Marxist Economic Theory

Heaven knows I'm no economist, but the history of countries that proported to support Marxist political and economic theory is pretty dismal - as in none have been stable for any reasonable period of time. Based upon that alone, I have to conclude that Marxism is really wrong-headed. Here's an essay that supports that position from more pwersonal experience with Marxist theory that I will ever have.

Marx Is dead
And I don't feel so good myself.

by Sarah A. Hoyt at http://www.classicalvalues.com/archives/2011/02/marx_is_dead.html#more

When I was in highschool in the seventies (well, it couldn't be helped. It's not like I chose my date of birth. But in my defense, I delayed coming of age till 1980) in Portugal, I studied Marxism and Marxist theory in four classes a year: off the top of my head, the line up I remember is History; Economics; Portuguese; Sociology. (And if you ask why I was taking Sociology in Highschool, it's because the Portuguese system has no electives. They tell you what you're going to study. And Sociology gave them one more chance to teach Marx.)

Of course, we used "Marxist Techniques" in other courses too - anthropology; literary analysis. I seem - vaguely - to remember we used Marxist analysis in biology but I hope to all that's good and holy that I'm wrong about that. (It was a long time ago.) It would be roughly the equivalent of using the rhythm method in literary production. Or perhaps grammatical analysis in music. I mean, you can bend anything in any way, but it makes no sense.

I read somewhere, written by a more literate person - I believe an economist - that the weakest point of the Marxist theories was that Marx, as an economist, was such a bizarre failure he never understood the role of resellers.

This sounds, at gut level, true, since in Portugal, when it much resembled the mythical happy land of Brutopia, also back in the seventies, there was a virtual propaganda war against marker-uppers.

This makes perfect sense, if what you have are classroom Marxists looking at the economy and completely unable to see reality through the fog of what they were taught.

This would only make sense for an academic who has lived in the city his whole life and is NOT aware of where his veggies come from. If you think your pasta grows on trees, you probably can imagine sauntering down to the local park and picking a bushel full. At worst, if you know it has to be made in a factory, you figure you should get it at factory price. Of course.

But the people who transport it have to make money too. Even if the transport is across town to your grocery store. And the people who sell it have to make money too. Unless you buy your pasta at the little corner store of pasta-only, in which case you might as well go to the factory, the supermarket offers you the convenience of shopping for a lot of things under one roof.

Having grown up in a village, where there were general stores, but no supermarkets, at certain times of year one did have to go five or six places to get: meat; fruit; veggies; bread. And if that sounds quaint and wonderful, I'll point out a shopping trip could - and often did - consume all of my mother's morning for half a dozen items. Also, most of those shops were already "resellers" who were marking up the product - meat would come from several sources, so the butcher could sell you beef or lamb or pork or even (hey, this is Europe) horse. Fruit came from the various farms in the region. Ditto veggies.

Now imagine you had to do this for everything you wanted to buy. EVERYTHING. Books? Go to the author. Each author. Even with ebooks, that would get maddening. Pens, go to the factory. Resellers earn their markup. (And never mind most of them are investing in the stuff to resell and taking a huge risk. At the very minimum, even Walmart has to pay for the building and rent, and employees and then make it pay.)

But you really, really, really cannot study Marx for any length of time without seeing other holes. For instance, take his entire view of power relationships in society. It is clear these are modeled on Academic Relationships, which is why - poor bunny - he got the whole thing upside down and sideways. Marx didn't understand the concept of "mutual benefit." Look, I'm very aware of "mutual benefit." As bad as the publishing world is - and it is, mostly because it is by and large run by people who (often without being aware of it) view the world through a Marxist prism, and therefore think they are supposed to be exploiting others (because it's what everyone in a position of power would do.) - my working for my publishers is always mutually beneficial. (Sometimes more than others, in a direction or another.) Yeah, they get most of the money from a book publication. But, hey, I get money up front, which in many ways allows me to sit here on my behind writing the book instead of having a real job.

Most - even those we wouldn't think - employer/employee relationships are also mutually beneficial. Yes, even in the sweat shops that have now moved to remote third world countries. Look, something you have to be aware of is that your history of the industrial revolution was by and large written by Marxists, or by the sort of academic culture that spawned Marx. And we're seeing the same thing play out now.

You see American liberals wring their hands over the exploitation of child workers, or scream about workers who sleep in their factories and have no days off.

Are there horrible things that happen at that level of industrialization? Oh, deary me, yes. Again remember I come from a country that likes to tell itself it's NOT third world. Out of a class of twelve girls in elementary school, four of us went on to the prep-school (fifth and sixth grade) which allowed us to enter highschool (seventh through twelfth.) The rest? Well, Portugal was one of the first countries in Europe to ban child labor. HOWEVER if your child was mentally retarded (educable mentally retarded, actually) the prohibition was waived so that they could "learn a trade." So, those other ten girls all got doctors (Hello Wisconsin!) to certify they were mentally retarded, so they could work in the textile mills. At the age of ten. Weekends, but no vacation. At least they had fairly clean places to work, and weren't beaten, let alone made to work with machines that might take their hands off - though industrial accidents still happen - and had a forty hour work week. However, if you have a ten year old, imagine him cooped up from nine to five, inside a room, unable to run or play, and having to be answerable to a boss.

And that's under "soft conditions." Of course a lot of the industrial revolution was awful. BUT there are two things they don't tell you.

First, it was MUCH better than the conditions they were living under. How do I know that? Oh, easy. One, because people aren't stupid. No, really, honestly. People are not stupid when it comes to self-interest and survival. And it wasn't all "dispossessed peasants" who joined in the industrial revolution. That was Marx's addled view. People came of their own free will. Because life in the factories was better. The pay, miserable by our standards, was better. Because a family, in aggregate, with everyone working, could have a better life. In Portugal, villages have emptied. I understand the same things are happening in China and India and places now undergoing the process.

The idea that life is better in the villages is the day-dreaming of academics who vacation in villages. Not of the people voting for industrialization with their feet and hands.

Second, there was a population explosion and average life span grew longer.

So, even in those conditions, which were, by our lights, horrible, the employees got a benefit from the employers. As for the employers... Well, my dears, the fact is life was not as good as we have it for anyone. Yeah, some "robber barons" made it spectacularly. But most people with money were one financial disaster away from being at the same level as their workers. There are plenty of stories of riches to rags from that time. So, they took a risk in starting the factory. Just like their workers endured the conditions. And both benefitted to an extent they were comfortable with.

Marx saw only exploitation.

Part of this was because of Marx's understanding of value, which is the pinnacle, or perhaps the foundation on which ALL his misunderstandings rest. It is also the most widely, insinuatingly pervasive of the Marxist concepts in our society.

To Marx value was raw material plus work. The means of producing that work (machinery, etc) were just sort of there. And he made no allowance for invention. (Which is why though Marxist revolutions often recruit intellectuals they're the sort of intellectuals who never had an original idea in their life.) Of course in our day and age, invention and original thought are at least as important as machinery in creating product. Also, the raw material fallacy means all the countries who have nothing else to sell feel "exploited" because we're taking their "value" away. Imbuing raw material itself with value means that it's sort of like stealing national treasure. This has given rise to an entire colonialist-exploitation-theory of history which has held more people in misery in developing countries than the most brazen robber baron could manage. And no one, NOT ONE seems to realize that their raw materials mean absolutely nothing if not used. If someone doesn't have an idea to use it. If the finished product is not good for something. In other words, if you're not producing something that someone else finds useful. (I.e. enough to pay for.) If the relationship isn't MUTUALLY beneficial.

I don't have time to go into all the crazy things that idea has caused, because the work=value thing fascinates me even more.

This is an idea SO loony only an exceedingly well educated person could believe it. We've all heard of the famous "if I take a month to polish a dog turd, can I charge by the hour of my labor?" And to that you'll say "But it's only a dog turd. Dog turds have no market value."

Ah, you'd be wrong, my fine, feathered friend. There are industries that use those. But let's suppose for the sake of the argument this is your pet pooch's poop that you just throw away normally. No value. But if I devote a month to polishing it... Let's say I get paid at $7 an hour. That's cheap, as I normally make more than that, but let's suppose I ONLY make that. So...

Seven times eight times twenty, I should be able to charge $560 (update: my older son pointed out I gave you an even better discount, as my mind recoiled from the true value of my labor in polishing the dog turd, which should be: $1120) for my polished dog turd. And cheap at the price, mind, since I'm not charging the residual value of the raw materials and I'm giving you a discount on my labor. Come on! What are you waiting for?

This also discounts things such as human knowledge. Humans get better at tasks they do most often. This is the idea behind training. So, let's suppose what we're making is clay cups. I will undoubtedly take longer to make a clay cup than a master craftsman. I also - hey, I know myself - will end up with a lumpy product full of thumb marks. But I took longer. Therefore it's worth more, right? (Suddenly I understand how certain artsy shops charge for things.)

Now you're laughing and telling me no one believes that. Ah, but you're wrong. First of all people believed that - absolutely believed that, until they were in the place where they set production quotas and all the shoes available for sale were size twenty six and for the left foot.

People STILL believe that. Before people ever read a book of mine, if they find out how much I write, they will inform me that I'm doing hack work. BEFORE reading me. (Yes, I've had people turn around and apologize AFTER reading me.) Or - and this is my favorite - that I don't care about what I do. It never seems to occur to them that before I got to the point I am (Yes, I CAN comfortably write four books in a year, thank you so much) I wrote for fifteen years without being paid a cent, practicing and learning my craft, so that now craft can support me where the sheer "inspiration" fails. As for caring ... No matter how fast I work, novels are HARD. Heck, short stories are hard. I don't think I could physically finish a book I didn't care about. The ones that for whatever reason I feel marginally attached to are an epic battle as is.

Many authors wrote books in a week or less (Rex Stout comes to mind.) A lot of beginners write books that take them ten years and TRUST me, you wouldn't want to read them. (I have done my time in slush piles.) So, why would this idea persist? Ah... good old Marx.

Good old Marx is also responsible for that most insane of ideas, the minimum wage. Dictating a minimum wage people have to be paid is the same as saying that labor has an intrinsic, minimal value. And before you scream I'm cruel or heartless, what the heck do feelings have to do with economics? Economics is the science of value. Value is what someone is willing to pay for something. NOT "but they need this to survive." THAT is an idea that work in itself has a value.

If that were true, we could hire an army of unemployed workers to polish dog turds for the international market. We'd be rich, rich I tell you!

And for the gentleman in the back with the sign calling me a corporate running dog - I'm not proposing to let unskilled people starve (though neither should we keep them so comfortable that they never learn a craft. If someone had paid me a living wage to write that awful first... or second... or third... novel, I'd have had no reason to improve.) THAT is a completely separate mechanism. That falls under charity or, if I can't dissuade you, some sort of government looting-and-redistributing program. (What do you mean it's not looting? They take taxes on the threat of force. ALWAYS. That's looting.) It's a stupid option, but, in moderation, our society can support it. In fact, if we keep it moderate, we would be rich enough to support a lot of it. And it wouldn't distort markets or prevent people from acquiring skills. Yes, even retail involves skill.

The point is the only possible justification for minimum wage IS the Marxist theory of value. The only possible justification for asking rich people to "give back" - which presumes they stole something to begin with - "to the community" is the Marxist theory of value. For that matter, the reason our schools treat truly smart kids (not what they call "gifted" which often just means "shuts up and does as told well." ) as pariahs - because it takes them less effort and less time to accomplish what others take forever to do - is the Marxist theory of value.

Brothers and sisters, I bring you news of great joy: Marx is dead. Let's ensure his theories die also and do not rise again.