Below is a reflection paper for my History of Economic Thought Class. Enjoy.
I have often been wrong in this
class. Whether it is suggesting that wealth inequality has been decreasing, or
thinking Mills was like Reagan, it is obvious that I have a lot to learn about
economic thought. My readings on Marx do not make me feel any different. In
fact, in the first reading, “Marx on Economics,” there is a recurring theme
about how the majority of people are ignorant to the true doctrine of Marx.
Although I would like to consider myself a little more knowledgeable than the
average person, it is obvious that I am not the most knowledgeable economist,
nor anything close to it. So, I must approach these readings from the
perspective of ignorance. It will be difficult to ignore the years of
propaganda and lies I have learned about Marx, but I will do my best.
“Marx on Economics” did a very good
job pointing out several accomplishments and faults of Marx and Engels
writings. One of Marx accomplishments
was his theory of business cycles. Marx
and Engles were some of the first to notice that there were periods of
fluctuation of growth, upward and downward.
Although Marx never did extensively define his theory of business
cycles, the author mentions that most of what is contained in today’s theory of
business cycles can be found in parts of his writings.
Marx also seemed to offer
significant contributions to the theory of labor. Although inspired by Ricardo,
he didn’t accept Ricardo’s labor theory of value. So, he created his own. There
are several problems with Marx’s labor theory of value, and we now know it is
not the best way to measure value. The second reading, “Marxian Socialism,”
mentioned a major contradiction that it called the “Transformation Problem.”
Marx himself attempted to solve this problem in Volume 3 of Capital. The author
mentions there is great debate as to the level of success Marx was able to
achieve.
Marx denounced Say’s law. He called
it childish and boiled it down to meaning that if there is a sale, there must
be a purchase and therefor always a balance of sales and purchases. He pointed
out the obvious truth that if you add currency, suddenly there is no
requirement for someone to make a purchase just because they just made a sale. If Say’s law is true this would cause crisis.
One of the shortcomings of Marx’s
writings was his prediction of the future. Obviously, no one can predict the
future any prediction of the future has to be considered in that light.
However, many of the motivations of Marx rested on his predictions of the
future of capitalism. Marx saw a capitalist society that would continue to grow
into a few incredibly rich capitalists wielding unchecked amounts of power and
using it to enslaved a massive workforce. The author mentions how Marx could
not have foreseen things like growth of powerful workers unions, or the
animosity experience between competing industries in multiple nations (ie auto
industry). Even though I agree that the “increasing misery of the working
class” was a “fantastic miscalculation,” my cynical self will argue that Marx
was and is right.
It shouldn’t be surprising to those
aware of our current situation. Wealth inequality is at an all time high. Wages
have not been increasing lately and it seems that the workingman can barely get
by. Politicians are slaves to special interests and addicted to their own
power. The uber rich control them by addicting them to power and
contributions. They fear more the next
election than worry about what’s right. Has the state not become an “instrument
of force used by capitalists against workers?”
Corruption is rampant in our
government and private industries. Greed has driving Wall Street and big banks
to take bigger and bigger risks. Losses are covered up in offshore companies. Are
we not also slaves to the “man?” Do we not sell our freedom by the hour? Does
our consumer culture not enslave us in shackles of debt? It might have happened
a little differently than Marx predicted, but does this not sound like the
“future” of capitalism that Marx described?
Many people believe this, but I
don’t. I don’t believe capitalism is to blame for the degradation of society.
In fact it is the continued growth of government that tempts politicians with
increasing power. It is the call of the worker for more social planning that
increases the size of government. Yes, men like Bill Gates yield disgusting
amounts of power. However Bill himself would not be able to shape our
children’s curriculum to create an army of Microsoft customers if it wasn’t for
our socialized education system.
Many people want the masses to
believe this. For various reasons they want the lower classes to rise up and
revolt. But many of those same people are the cause of many of these problems. For
some reason I feel like I am digging myself a hole, but I like digging so I
will continue.
The biggest thing that I don’t
understand is the obsession with Marx in our current economic society. I have
listened while an economist went on and on about how horrible capitalism is.
The problem was that he used many Marxist and Socialist examples and called
them capitalism because they were or are found in our society today. Maybe I’m
wrong, but I don’t believe we live in a capitalist economy. We do to an extent,
but I think our current economy more closely represents imperialism. It’s a mix
of government collusion with private business similar to what we saw during
Great Britain’s period of colonization. I digress.
Marx has been discredited. His
labor theory of value was extremely flawed and neglected to recognize other
sources of value. His analysis of capital accumulation proved to be wrong and
failed to recognize other possible outcomes of capital accumulation. His theory
of exploitation of workers, highly dependent on his labor theory of value,
proved to be incorrect. Long periods of unemployment have been the exception in
capitalism more than the rule. His theory of class conflict failed to recognize
that the government could step in and make things better for exploited workers.
Even the idea of Marxist Utopia, not mentioned in either reading, has been
tried and failed. The incentives to take risks, provided to workers and
entrepreneurs by the capitalist system, have proven to be a very efficient way
to increase quality of life.
So why is capitalism so demonized?
Why is socialism and Marxism making a resurgence of popularity in our society?
Although I feel some form of Marxism is an inevitable equilibrium due to
proliferating ignorance in society, even some of the most well educated
economists in society are Marxist. I just don’t understand it. I assume, and
look forward to, my questions being answered in class. I started reading the
Communist Manifesto a while ago, and confess that I have been distracted by
other readings. However, I have been looking forward to the subject of Marx
from the beginning of the semester.
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