Karl Marx’s alternative to capitalism part 6

china1larg.workers.giThe continued growth in the productive powers of society can only mean the increased productive power of human labour, exercised through increasing use of the implements of labour and the organisation and application of scientific knowledge.  This in turn can only manifest itself in the growth of the working class that exercises this power, wields the implements of labour and develops and applies advances in scientific knowledge.

The result has been the increasing creation of the material conditions that can provide the foundations for a more equitable and socially just society.  The most important of these is the growth of the global working class.

From 1980 to 2010 the world’s labour force grew by 1.2 billion, to approximately 2.9 billion, with almost 90 per cent of the growth occurring in what has been called developing countries, including 500 million in China and India.  In the process 620 million people have been lifted out of poverty, as defined by the World Bank at $1.25 per day (at 2005 purchasing power parity).  Global non-farm employment rose from 54 per cent of all jobs in 1980 to 70 per cent in 2010.

From 1990 to 2010 China’s productivity was estimated to have grown by an average of 9.8 per cent per year, about one fifth as a result of the move from countryside to the city.   Wages grew as a result, and the ‘Financial Times’ has recently reported that the scope for this mass migration to continue had now ended.  (All figures from McKinsey)

In what are called the advanced economies 165 million new non-farm jobs were created and a large number of these taken by women joining the workforce.  Over this period the number of women in the labour force rose by 77 million accounting for the majority, 61 per cent, of the net new additions of 122 million.

Average skill levels of the workforce have also risen with the number of college graduates in the world labour force doubling in the economically advanced countries and growing by two and a half times in developing countries.  Around 700 million high school graduates joined the world’s labour force, increasing the proportion of those with secondary education to 48 per cent in 2010 from 39 per cent in 1980.

The assumption that only the ‘advanced’ countries have educated workers with the knowledge and skills necessary for innovation and more advanced production is now untrue.  In 1970 approximately 30 per cent of university enrolments were in the United States but by 2006 this was only around 12 per cent. The share of the world’s Ph.D.’s accounted for by the US has fallen from around 50 per cent in the early 1970s to 18 per cent in 2004.  By 2005 South Korea was sending a larger proportion of its young people to university than the US. And, for example, only 10 per cent of Italy’s working age population had a college degree in 2010, lower than in Malaysia, Thailand and the Philippines.  Countries such as Indonesia, Brazil, Peru and Poland more than doubled their university enrolments in the 1980s and 1990s. (Quoted from ‘The new global labour market’)

The McKinsey report quoted above states that in the advanced countries the share of national income going to labour rose during the 1950s and 1960s, peaking in 1975, but has fallen ever since and is now below its 1950 level.  The wages of less skilled workers have stagnated or fallen in all but a handful of advanced countries while the incomes of those in the top 10 per cent have risen.  Capitalists complain that they cannot get the necessary skilled workers and unemployment among those with only secondary education is nearly twice as high as among those with college degrees.  In the advanced countries unemployment among the least skilled is two to four times higher than the most highly skilled.

As illustration of the insanity of capitalism’s failure to develop in any sort of rational manner, an article in the ‘Irish Times’ earlier this year notes that the Irish State has the dubious distinction of having the most overeducated workforce in Europe with around a third overqualified for the jobs that they do, just in front of Cyprus, Spain and Greece.  It reports one young woman with a degree and a Diploma in primary school teaching who made 80 job applications last year and didn’t get one interview.  As the duration of unemployment grows the skills previously acquired atrophy and the social labour expended on their acquisition is wasted.

So some educated workers can’t get a job commensurate with their education while capitalists complain they can’t get skilled workers.  A further twist is added when you consider the well paid jobs that some workers get have relatively little to do with their accumulated knowledge.

I recall reading some time ago an article in a British newspaper that noted that the knowledge and skills of those with science qualifications is socially wasted in jobs within the media industry, in companies like Google or Facebook, doing jobs that involved not much more than high-tech advertising and selling.  I know of one young woman who has a PhD. in science, in which she studied the transfer of drugs through the body for those with cystic fibrosis but who could only get a decent wage by requalifying as an accountant.

When production is profit driven, without any conscious societal mechanisms to determine social priorities, such waste appears in statistics as remarkable progress.  What isn’t measured is the potential contribution that millions of working people could make but can’t because of the lack of opportunities and subordination and lack of democracy in the workplace that stifles their ambition and creative powers.

Despite all this however it has to be understood that capitalism continues to develop, and the productive power of humanity continues to grow massively.  The need for skilled workers grows even if the system often wastes much of the knowledge and skills created.

There can be no doubt that the ‘civilising mission’ of capitalism, which the last few of these posts have been about, continues.  Of course it does not develop evenly and does not develop without antagonism or contradiction and in the next posts I will look some more at the limited and contradictory character of this development.

However if capitalism were simply as system in crisis we could not explain why it still exists.  If it were not still revolutionising the means of production and developing the productivity of labour it would no longer be the capitalism analysed by Marx and we would have to find some other approach to understanding it.

Most important of all, as I have said before: if capitalism created only oppressed, exploited and alienated human beings where could the alternative come from?

Back to Part 5

Karl Marx’s alternative to capitalism part 5: capitalism’s achievements

classroom-19th-century-1140x684One comment on an earlier post on the blog relating to the situation in Greece included the following: “So I think the task at hand is not to solve Greece’s economic crisis, this will certainly take years. Rather it is to add some political organisation and direction on to the instinct to fight. I believe that you are thinking too far ahead, overly concerned with what socialism should be in the future, and not really catching the fire of the present.”

Leaving aside whether this was true of this particular post on Greece or even of other posts; a point I have made is that the Marxist movement is too concerned with attempting to “catch the fire of the present”.  This has usually meant jumping on whatever bandwagon it thinks might propel it along in some opportunist direction.  This is informed by the view that socialism will arrive through a capitalist crisis that precipitates political revolution that will destroy the existing state and then introduce the new society.  All of which it will lead through “catching the fire” in some sort of eschatological conflagration.

Missing is the development of the alternative, evolving within capitalism in advance of any crisis, that creates and develops workers’ power in the present and most of all creates the conditions that means workers actually seek a socialist alternative long before any crisis.  Missing is the building of a working class movement that fights for an alternative society now, sees such a new society as its answer to its problems and does not limit itself to the necessarily defensive struggles against capitalist attacks.

This understanding of the working class movement, as embodying the future alternative within itself, is now more or less completely lost but would have been the foundation of workers’ socialist consciousness during most of the first century of the movement’s existence.  So, the building of mass workers’ parties, trade unions, friendly societies, educational organisations and cooperatives were all seen to be the visible rise of the more or less inevitable final victory of socialism.

No such confidence now pervades the socialist movement and part of this impoverished outlook is the perspective of fighting for and relying on the state to deliver the goods.  This and/or the view that some future, but always more or less near, political crisis will quickly precipitate a struggle and a consciousness adequate for a successful political revolution.   A view that forgets that socialist revolution is distinguished by it being primarily a social one and the Marxist view that social being determines consciousness: that is the development of consciousness is based on the development of capitalism, including what workers do over many decades to develop their own power and organisation within it. There is no exception in such a view for small groups propagandising for revolution, crisis or no crisis.

The patient building of workers organisations, such as cooperatives, is viewed by some as simply reform of capitalism when in fact no successful revolution will be possible without them.  Opposition to what has been termed the stages theory of revolution, that every workers struggle is inevitably limited to certain non-socialist goals, is confused with rejection of the truth that the working class will go through stages of development and that earlier stages that do not immediately threaten the system are also just as necessary because they are expressions of the workers own activity and power.

That this has been more or less forgotten is both a product and producer of the decline of the socialist movement.

That is why I started to write a series of posts on Marx’s alternative to capitalism, because without such an alternative there will be no, well to state the obvious – alternative!  It’s why this series is now continued.

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In the last post on Marx’s alternative I said I would look at the evidence that the development of capitalism continues to provide the grounds for socialism as an alternative.  By this I mean the contradictory nature of capitalism is still creating on an increasing scale its gravediggers, the working class, and that even “with all the miseries it imposes upon them, the present system simultaneously engenders the material conditions and the social forms necessary for an economical reconstruction of society.” Marx.

A look at the long term development of capitalism illustrates what Marx called its civilising mission, a product not just of the growing requirements of capitalist production for an educated and relatively healthy workforce but of the needs of the capitalist state itself that provides most of this education.  By 1985 mass education was compulsory in 80 per cent of the countries of the world and over 90 per cent of the world’s children spent some time enrolled in school.

Estimates for the year 1900 put participation rates in primary education at under 40 per cent in most parts of the world outside North America, northwest Europe and English speaking areas of the Pacific, where it was over 70 per cent.  By the beginning of the twenty-first century every part of the world had achieved the minimum of the most industrialised countries at the start of the 20th century and most had exceeded it.

The picture of course is far from universally rosy and a 2007 UNESCO report estimated that in 2004 781 million adults did not have minimum literacy skills and close to 77 million children of school age were not enrolled in school.  Nevertheless the twentieth century was the first in human history in which the majority of the world’s population learned to read and write.

The development of higher level education has been just as dramatic.  In 1900 roughly half a million were enrolled in higher education institutions across the world.  By 2000 the number had grown two-hundredfold to 100 million people.  Growth in higher education has not slowed but accelerated in the latter part of the twentieth century; particularly after about 1960, with enrolment rates climbing rapidly, especially of women.  This growth has created what amounts to a global higher education system with “the same subjects . . . taught with the same perspectives leading to very similar degrees . .” (The Worldwide Expansion of Higher Education in the Twentieth Century)

If we look at population and health we can see the capacity of the productive system to support a growing population and improved health.  “Since 1800, global population size has already increased by a factor of six and by 2010 will have risen by a factor of ten. . . . The length of life, which has already more than doubled, will have tripled . . In 1800, women spent about 70 percent of their adult years bearing and rearing young children, but that fraction has decreased in many parts of the world to only about 14 percent, due to lower fertility and longer life.” (The Demographic transition: Three centuries of Fundamental Change)

Global life expectancy (years at birth) in 1700 was 27, still 27 in 1800, 30 by 1900 47 by 1950 and 65 by 2000, while population was 0.68 billion, 0.98, 1.65, 2.52 and 6.07 billion in the same years.  This decline in mortality began about 1800 in northwest Europe, and in many lower income countries at the beginning of the twentieth century, accelerating after the Second World War.

“The first stage of mortality decline is due to reductions in contagious and infectious diseases that are spread by air or water. Starting with the development of the smallpox vaccine in the late eighteenth century, preventive medicine played a role in mortality decline in Europe. However, public health measures played an important role from the late nineteenth century, and some quarantine measures may have been effective in earlier centuries. Improved personal hygiene also helped as income rose and as the germ theory of disease became more widely known and accepted. Another major factor in the early phases of growing life expectancy is improvements in nutrition. Famine mortality was reduced by improvements in storage and transportation that permitted integration of regional and international food markets . . .”

“In recent decades, the continuing reduction in mortality is due to reductions in chronic and degenerative diseases, notably heart disease and cancer (Riley, 2001). In the later part of the century, publicly organized and funded biomedical research has played an increasingly important part, and the human genome project and stem cell research promise future gains.”

“Many low-income populations did not begin the mortality transition until some time in the twentieth century. However, they then made gains in life expectancy quite rapidly by historical standards. In India, life expectancy rose from around 24 years in 1920 to 62 years today, a gain of .48 years per calendar year over 80 years. In China, life expectancy rose from 41 in 1950–1955 to 70 in 1995–1999, a gain of .65 years per year over 45 years.” (The Demographic transition: Three centuries of Fundamental Change)

Again however the gains in life expectancy are not uniform and the productive advances of capitalism, some of which are reflected in public health and medical advances, are subordinated to the accumulation of profit.  This is most clearly seen in the two significant exceptions noted in the article quoted above – the stagnation in mortality gains and increased mortality from HIV/AIDS in sub-Saharan Africa and the decline in life expectancy in Eastern Europe and the former Soviet Union arising from their transition to capitalism.  The article quotes the UN in 2002 noting that male life expectancy in the Russian Federation was 60, similar to that of India.

Back to Part 4

Forward to Part 6

Teaching entrepreneurship to children

entrepreneurdownloadWhen a front page article in ‘The Irish Times’ reported that the Irish Business and  Employers Confederation (IBEC) is calling for entrepreneurship to be taught in schools my first reaction was  a sort of harrumph – brainwashing kids.  Then I thought that maybe it wasn’t such a bad idea after all.

The content of the subject would have to be wide enough to cover the full range of knowledge and skills necessary to teach children how to make money.  And let’s be clear, that’s what the objective of entrepreneurship is.  Nobody starts a business to make less money than they currently are making and losing money is a quick way to not being an entrepreneur at all.  So I think we are on safe ground saying that making money is pretty fundamental to the subject.

Secondly, it would be necessary to explain something obvious to adults but not to children.  I read recently, I can’t remember where, that it is only by the age of twelve that children can reason logically and handle abstract concepts.  This means that when it is explained to them that entrepreneurship means making money, this does not mean it is part of the art class and doesn’t actually mean getting pieces of paper from teacher and marking it.

Later in the course syllabus it will unfortunately be necessary to row back on this a little, if not actually quite a lot, by explaining that money can actually be made by pieces of paper, that is by other pieces of paper that are already money.  This will be called investment and will be a difficult concept for the younger child to grasp.

It is of course sincerely to be hoped that sometime later these children come across an entirely different subject called Marxism, which will explain to them that in fact real wealth is a result of work and that (paper) money is only a symbol or token of this wealth.  At this stage it will also be explained that investing is not actually hard work and that therefore the real wealth received from investments (such as stocks, shares, bonds etc) is not actually produced by simply buying and selling these pieces of paper.  It is a result of someone else who doesn’t own these pieces of paper working hard to make the things that make up real wealth – like houses, cars, clothes and nice food, including sweets.  This can be easily demonstrated by role play in which the children sell pieces of paper in class and note the additional wealth that has been created or not created at the end of the exercise.

It will also be explained that although they will have learned that the interest that is received from their investment is a reward for their abstaining from consumption, i.e. doing nothing, they do not actually have to abstain from consuming and that a lot of capitalists, sorry entrepreneurs, actually consume quite a lot more than the rest of us, sorry, I mean more than them.

Similarly they will have been taught that doing nothing is not what investors do but is what poor people do and on no account can those who live on their investment income be accused of doing nothing.  Quite the contrary – they invest.  Marxism will then teach them that this is bollocks, which will probably have to wait until mild sweary words are deemed to be an appropriate teaching aid.

If the subject goes beyond pure entrepreneurship and includes modules on applied entrepreneurship the children will have to learn how to apply the theory of creating money and a business to a real world situation.  Earlier summary presentations about the marginal utility function of consumption will have to give way to appreciation that perfect information on the part of consumers may well be a necessary feature of perfectly competitive markets but that the last thing that real entrepreneurs want is a perfectly competitive market.

Teaching this to children will have its obvious difficulties and their heads will seriously spin when forced to accept that this is because, if there is a perfectly competitive market, there is actually no profit – so what’s the f*****g point they might ask?  They will find that they have created a business that only makes money for investors who have lent them the money and do nothing, or whatever.

If the brightest pupils demonstrate that they are able to retain these conflicting ideas in their heads they should nevertheless be discouraged from retaining any memory of their earlier lesson on free markets, which is that it’s probably not worth their while starting a business with their wizard new idea in the first place because the efficient market hypothesis implies it’s probably already been done.  And yes, that’s even if you think you’ve invented a time travel machine.

You can see how such abstract concepts might be difficult for the average child to grasp but it has been demonstrated that having been grasped it is incredibly difficult to shift these ideas, even among the brightest children who have advanced to be really good at maths.  These children might go on to be economists although this is difficult to encourage, being similar to telling a child that they can’t be a footballer but can aspire to write for the back page of ‘The Independent’ or, god forbid, the ‘Daily Record’ in Scotland.

Applied entrepreneurship, however involves not just theory, as we have said, but the rough and tumble of the real world of business.  Specifically for IBEC this means Irish business.  Being a real entrepreneur therefore means hard choices.  Do you want to be a small entrepreneur, in which case you might end up feeling that you are exploiting yourself?  Or do you want to be a BIG entrepreneur and be famous.

In the latter case knowing a bank manager will be indispensible in getting access to funding so playing golf might be of great assistance here.  Similarly, access to lucrative contracts and access to some newly created incentive scheme (you need these to incentivise making money because this doesn’t happen by itself) will be greatly assisted by knowing a politician.  If you don’t know one the child should be encouraged to get a brown bag and practice giving it to their local councillor.

Newspapers love small people acting like adults without really be aware of what they’re doing.  Very small children will no doubt forget the experience but this will be invaluable training and education for future life as forgetting what you’ve done and claiming not to know what it was you’ve just done are  a feature of applied entrepreneurship in Ireland, especially in dealings with politicians and appearing at tribunals of inquiry.

Applied entrepreneurship also often requires not paying taxes but for goodness sake don’t let the child worry about how their teacher is going to get paid or the next generation of entrepreneurs educated.

So, having thoroughly reconsidered the idea of teaching entrepreneurship I think is has some very positive implications:

  • The teaching of neo-classical economics would have to be discontinued in order for one of the subjects not fall into total disrepute.
  • Teaching children that they should aspire to own the means of production and not just work for them might spur the quite logical question why workers shouldn’t own their own firms by creating workers’ cooperatives.
  • In the spirit of social partnership the role of trade union representation should also be taught and in order to gain access to the syllabus as a subject in its own right will have to include identification of workers separate interests and the various means to represent and promote them (that is: simply agreeing with the employer would invalidate it as a separate subject of study)

The next related lesson will involve moving on to a post on A level economics and why that man Jeremy Corbyn could really do with having studied it.