What Vulgar Economists Do

"The vulgar economist does practically no more than translate the singular concepts of the capitalists, who are in the thrall of competition, into a seemingly more theoretical and generalized language". -Karl Marx, Capital (Vol. III), p.817

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Hegel and Marx on Freedom

"For Hegel freedom consists in being in a certain reflective and deliberative relation to oneself, which itself is possible, so it is argued, only if one is also already in a certain (ultimately institutional, norm-governed) relations to others, if one is a participant in certain practices... Put most simply, for an action to count as mine, it must make a certain kind of sense to the agent, and that means it must fit in intelligibly within a whole complex of practices and institutions within which doing this now could have coherent meaning... On his view, all of the standard conditions of action (e.g. "doing it voluntarily, uncoerced") could be fulfilled, yet we would not want to say that the action is truly "mine" such that I could fully or truly stand behind it, own up to it, and claim ownership of it... Hegel denies that we can separate the moral-psychological, individual dimension of freedom from social relations of dependence and independence said to be equally constitutive of freedom..." Robert Pippin, Hegel's Practical Philosophy, p.4-7

There is much about this that is very attractive as a conception of freedom. Hegel rejects the impoverished "negative" liberal conception of freedom that claims that we are free to the extent that we, as isolated individuals, are not "interfered" with by external coercion. Whereas this anemic view of freedom begins from the idea that persons are asocial atoms unto themselves, Hegel's conception of freedom proceeds from the fact that we are not isolated individual atoms: the institutions, traditions, practices, norms and social relations which surround us are partly constitutive of us. To be free is, therefore, not to be cut off from these constitutive features of human life. To be free is to stand in the right kind of relation with respect to oneself and others. It is to be able to affirm the basic institutions of social life; it is to be able to see oneself and be at home in such institutions.

But, of course, life under modern capitalism is such that we cannot rationally be at home in our society. We cannot see ourselves in the basic institutions of society (e.g. the market, private ownership of the means of production, etc.), since they lord over us as something alien to us, something not under our control. As I noted in a previous post:

"Consider the well-worn idea that you 'can't buck the market'. We have become so used to things as 'market forces'...that you are just as likely to come to grief as if you ignored natural forces -gravity, magnetism and so on.... you'd better do what the market says or else you will be in trouble. But what is the market? Simply the accumulated effects of innumerable human decisions about production and consumption. It is, thus, our own product, from which it follows that, once more, we come to be dominated by our own product."

Think of the terms in which the present financial crisis is described. People in the media talk about the economy as though it were a natural disaster, completely beyond our control, laying waste to human lives in its wake. But the market is no force of nature; it is something that human beings constructed. And what we've built up, we can tear down. "The market is like a monster we have accidentally created, but which now comes to rule our lives". Capitalism is, thus, in Marx's words, "the complete domination of dead matter over men". We cannot affirm the basic institutions of capitalist societies as our own since they dominate us. They are not the products of deliberative, collectively exercised reason, as are the expressions of a democratic process. The basic institutions of capitalism are the products of a system whose basic function is to generate profit for the ruling class. The result is that work, daily life, leisure, the majority of cultural production, etc. all tend to be structured around this unsavory, inhuman end of profit accumulation. This condition of not being able to affirm and recognize our social condition as our own is what Hegel called alienation. Freedom, then, is a kind of "non-alienation", an achievement in which alienation is overcome by way of a socially-grounded self-determination.

Moving from Hegel to Marx, it's worth saying a bit more about why contemporary capitalism is both alienating and unfree. By any measure, capitalism has succeeded in developing the forces of production (e.g. technology, productive instruments and techniques, instrumentally useful technical knowledge, etc.) to a very high degree. But rather than putting this powerful productive capacity in the service of meeting human needs, developing human talents and capabilities, creating the conditions for flourishing, etc... instead, almost all human potential is subjected to, and dominated by, the need to increase profit. Growth for the sake of growth, accumulation for the sake of accumulation, profit for the sake of profit. These are the unsavory priorities that shape social life under capitalism.

Whereas a free society would be one in which the productive forces were put in the service of human interests... ours is one in which human interests are subordinated to the expansion of the productive forces for the sake of expansion. Whereas a rational society would be one in which capital was subordinated to human ends, ours is a society in which human ends are subordinated to the dictates of capital. Whereas capitalism makes us feel as though we're the playthings of larger economic and social forces beyond our control... a socialist society would be one in which we could take control over our own lives by democractizing the basic structure of society. We can only call a society our own when we are able to say of the basic goals of that society that they are the products of our collective deliberations.

It should be obvious why so much of Hegel's conception of freedom appealed to Marx. To be sure, Hegel did not properly understand what the institutions and basic structure of modernity are like. Moreover, whereas Hegel claimed that modern capitalism was a product of a rational historical process, Marx was unrelenting in showing this to be false. History, Marx argued, is not the gradual unfolding of reason, culminating in modern capitalism. History is a political struggle among different groups, framed by the way in which the social surplus is produced. Capitalism, therefore, is not the rational overcoming of alienation, but merely another form of alienation, another class society like those that preceded it. The difference, however, is that capitalism, for the first time, creates the conditions for a free society in a way that previous societies did not. Whereas a free, egalitarian society may not have been possible in the Bronze Age, capitalist societies have made possible such a high degree of productivity that we can satisfy all basic human needs without working ourselves to death doing it. For the first time in human history, the high level of development of the productive forces under capitalism make possible a society free from alienation, class domination and objectively necessary poverty and suffering.

Freedom would not be to walk through a supermarket perusing 20 different brands of toilet cleaner without "external interference"... freedom would be to see in basic social institutions the mark of human, democratic reason. It would be to see oneself, as a member of a modern democratic society, in the basic structure of society and, thus, to be able to reflectively endorse and affirm that society. Such is not possible when the iron law of profit dictates what is to receive investment and what is to wither on the vine. It is not possible to reflectively endorse and affirm what is imposed upon us in the interests of inhuman ends. That is to say, it is not possible to be fully free in a society in which the commanding heights of the economy is governed by the demands of profit and controlled by a small class of capitalists.

In light of the above we can make sense of Alasdair MacIntyre's claim that "...at least one philosophy course, and, more adequately two, should be required of every undergraduate. Of course an education of this kind would require a major shift in our resources and priorities, and, if successful, it would produce in our students habits of mind which would unfit them for the contemporary world. But to unfit our students for the contemporary world ought in any case to be one of our educational aims." To "unfit" students for the modern age, as I'm reading it, means to get them to think critically, i.e. to become aware of alienation (to see clearly the sense in which we cannot truly be at home, and hence free, in modern capitalism). A good education would not be one that subordinated all curricula to the capricious demands of the labor market. A good education would be one which produced in us "habits of mind which would unfit them for the contemporary world" in such a way that they would come to demand that the world itself change. Rather than pandering to the world as it is, good education would challenge us to think seriously about how to change it for the better and truly make it our own.

It should be obvious, but it's nonetheless worth saying, that bureaucratic central planning is equally condemned by this view of freedom. The mechanistic distortions of Stalinism are anathema to freedom. If the basic institutions of society are under the control of a bureaucratic nomenklatura, this is hardly better than capitalism. In such a case we would still feel that we were subject to forces beyond our control, forces which were emphatically not the products of collective, democratic deliberation. For if the state, rather than private capitalists, dominates production there is still the question: but who controls the state? Thus, it should be obvious that taking this Hegelian-Marxist view of freedom leaves only one route to overcoming alienation and class domination: the most radical form of democracy. Only when we're all able to interact with each other as equal co-legislators are we fully free. As long as social relations of domination exist, freedom is not possible. Thus, freedom and equality are not antagonistic others, but mutually constitutive aspects of the same goal.

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It's the system, stupid

Dominant ideologies teach us that "personal responsibility" and individual efforts are all that shape our social and political world. All Great things, we're taught, were forged out of nothingness by Great individuals (who, it turns out, are almost always men). Accordingly, we learn American History as though it were, in the first instance, the outcome of the actions of individual Presidents. We're encouraged to admire fabulously wealthy "self-made men" at the same time that we're taught to blame only ourselves for all our hardships. These ideologies, Fredric Jameson points out, "all find their functional utility in the repression of the social and historical, and in the perpetuation of some timeless and ahistorical view of human life and social relations".

This ludicrous view is even given a "scientific" veneer in the fantasy world constructed by neoclassical economics, where we are told that the money individuals receive in market societies attaches to nothing but their marginal productive contributions. These ideas are part of the conceptual legitimation of the society we live in, and, thus, it is unsurprising that they should be ubiquitous and "obvious" to many.

Accordingly, when radicals, and Marxists in particular, criticize the capitalist class it is often assumed that the criticism is merely a moralistic condemnation of individual capitalists. For example, when those on the Left criticize, say, the dominance of multinational corporations, this criticism is often heard as an attack on "evil corporate leaders". But the Marxist complaint has never been that the individual capitalists are evil or merely in need of moral scrutiny.

The Marxist complaint isn't that the ruling class is evil. In the first instance, of course, the Marxist complaint against the ruling class consists in hostility to the fact that they are a ruling class. The Marxist complaint, therefore, is not concerned to moralistically attacking capitalists as "bad persons", it is a complaint that targets certain unequal social relations. And what grounds and structures social relations, of course, is not for any individual to decide willy nilly: human beings "make their own history, but not in conditions of their own choosing", that is, "in the social production of their life, men [sic] enter into definite relations that are indispensable and independent of their will, relations of production which correspond to a definite stage of the development of their material productive forces" (see the Eighteenth Brumaire and the 1859 Preface respectively).

Thus, the complaint isn't that we have a ruling class that is too greedy, too mean to their workers, too insensitive to human need. The complaint is that we have a ruling class at all.

But we can sharpen this further still. When Marx criticizes the actions of the ruling class, it isn't because he thinks they made incompetent or insufficiently moral decisions. It's because he thinks that the basic structure of capitalism makes it rational for those in certain institutional roles, such as the role (class) of capitalist owner, to tend to act in certain ways. Hence, in order to be a capitalist at all, given the way that economic structure of capitalist societies is set up, you have to be able to compete against other capitalists, reinvest profits in further growth, etc. In order to be a capitalist, you have to do certain things whether you like it or not, given the pressures of market competition and the way that investment is structured. To be sure, as an individual you are free to diverge from the structural pressures of the system, but only so much. The reactionary slogan that "you can't buck the market" has a slice of truth to it (the reactionary part of it being that it suggests that we can't get rid of the market itself). An excessively "friendly" capitalist might easily be pushed out of business by more ruthless and exploitative competitors.

As political theorist Alan Ryan describes it:

"Marx supposes that under capitalism, there are two sorts of oppression at work, rather than one. Capitalists oppress workers, driving them as hard as they can to extract maximum surplus value from them. But this is not because capitalists are individually brutal; they themselves are driven by their capital. The irrationality of a capitalist economy in which production is dictated by the accidents of market interaction is read by Marx as the blind tyranny of capital over its human subjects. The fact that capital is in any case only dead labor leads Marx to tremendous rhetorical flights in which he describes capital as a vampire, renewing its life-in-death by sucking the blood of living laborers...what humanity has done is create Frankenstein's monster; so far from the world submitting to human control, it has been set in motion as a blind force tyrannizing over all of us... Capital dominates all of us and turns all of us into its purposes."

Or, as I described in a recent post on alienation:

Think of the terms in which the present financial crisis is described. People in the media talk about the economy as though it were a natural disaster, completely beyond our control, laying waste to human lives in its wake. But the market is no force of nature; it is something that human beings constructed. And what we've built up, we can tear down. "The market is like a monster we have accidentally created, but which now comes to rule our lives". Capitalism, in Marx's words, is "the complete domination of dead matter over men".

Capitalism is, thus, like a car that humanity built, which we continue to fill with fuel but which we have no capacity to control or steer. Adding the threat of global warming to this metaphor would be to say that our out-of-control vehicle is steadily heading towards a steep cliff.

I should add one more thing to stave off a misunderstanding. It's not that I think that individual members of the ruling class should be exempt from moral critique qua persons. On the contrary, I think many of them are reprehensible in many respects. But we shouldn't confuse such moral criticism from the political critique we need in order to properly place their behavior in its institutional context. Suppose some individual capitalist was won over by such moralizing critique and then sold off their productive assets to become a revolutionary. This is all well and good, but the way the system is set up it is certain that someone else will fill this person's "empty seat" at the ruling class table in no time. The Marxist argument is that we need to get rid of these seats and this table itself, not just the particular individuals who happen to sit there at any one time.

I also hardly mean to suggest that because we're all dominated by capital, we're all somehow in the same predicament. We're not; capitalism is a class society and the ruling class dominates and exploits the majority of us for their benefit. But we won't get very far if we think that capitalism is a highly coordinated, planned system that is ruled by a small, highly organized and conscious class whose intentional actions shape the system all the way down. This is not a left-wing critique, but a conspiracy theory that draws on the individualist ideology I impugned above. This kind of line suggests that the ruling class deliberately drove the world economy into the dumps, since whatever happens would have to be intended by the all-powerful rulers.

But this isn't Marxist in the least; the most interesting part of the Marxist critique of capitalism is that we get a dialectical interpretation of the relationship between structure and agency, between system and individual, such that neither is wholly reducible to the other. The actions of the ruling class do matter and need to be critiqued, but always in the context of the pressures of capitalist system which shape and structure their motivations and actions. In the case of the recent economic meltdown, for example, this analysis allows us to see how capitalism makes certain actions appear locally rational for individual capitalists, but collectively irrational even for the entire capitalist class writ large! It is an chaotic system that structurally requires myopic individual (or firm-level) profit accumulation.

Marx says on many occasions things to the effect that "human beings make their own history, but...". As Alasdair MacIntyre puts it, the goal of socialists is to remove that "but...".

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David Harvey video on Marx's Method

Here.

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Geuss on Reflexive Political Thinking

"I and every knowledgeable person I knew thought we were able to see very clearly before the fact that the invasion of Iraq was a recipe for human and political disaster and a potentially self-destructive policy for the UK to pursue, so why wasn't Blair able to see this? However, even to ask the question in this way means one has not come very far. The tradition of philosophy that descends from Hegel to the early Frankfurt School holds that philosophical thinking, including philosophically informed thinking, must be reflexive. Whatever questions I might put about claims my interlocutor makes, I must also put the very same questions to myself with exactly the same or even greater rigor. In the heat of the moment it is very tempting to look for one's opponent's failure of imagination, that is, for a diagnosis of Blair's problem, but to do this is only one half the story. Equally important, and perhaps more important for me and those who thought as I did, was to reflect on what problem I had that prevented me from being able easily to imagine that a politician could see projects like the invasion as merely one among other possible, unobjectionable options for action, rather than as nothing but a clear disaster waiting to happen."

-R. Geuss, Politics and the Imagination

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Work. Why I Hate It.

From Marx's Early Writings:

With the advent of barter [the labourer's] labour became in part a source of income. Its purpose and existence have become different. As value, exchange value, equivalent, the product is no longer produced on account of its direct personal connection with the producer. The more production is diversified, i.e. the more needs become diversified and the more the activity of the producer becomes one-sided, the more completely work falls into the category of wage-labour until, finally, no other meaning is left to it. It thus becomes wholly accidental and unimportant whether the relationship between producer and product is governed by immediate enjoyment and personal needs and whether the activity, the act of working, involves the fulfilment of his personality, the realization of his natural talents and spiritual goals.

Wage-labour consists of the following elements: (1) the estrangement of labour from its subject, the labourer, and its arbitrariness from his point of view; (2) the estrangement of labour from its object, its arbitrariness vis-a-vis the object; (3) the determination of the labourer by social needs alien to him and which act upon him with compulsive force. He must submit to this force from egoistic need, from necessity; for him the needs of society mean only the satisfaction of his personal wants while for society he is only the slave that satisfies its needs; (4) the labourer regards the maintenance of his individual existence as the aim of his activity; his actual labours serve only as a means to this end. He thus activates his life to acquire the means of life.

I really hate work. I know this cycle all too well, and I felt it before I ever read a paragraph of Marx. Labor is our means to life, and so, labor becomes our life. Of course, being aware of this type of estrangement and alienation makes it all the more hard to bear, I think. Why is it, with this critical perspective of work, I can't make myself do any less work or try to think about it any less in my day to day? Why do I still feel guilty when I don't work? Why can't we shape a life or identity apart form work, once we know it has the power to overtake us? And why does society insist on praising for my annoying "work ethic," as if there were some moral triumph in wage-labor.

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Marx on Money -- and Love

A most cynical, and yet hopeful post-Valentine's Day excerpt:

That which I am unable to do as a man, and of which therefore all my individual essential powers are incapable, I am able to do by means of money. Money thus turns each of these powers into something which in itself it is not — turns it, that is, into its contrary.

If I long for a particular dish or want to take the mail-coach because I am not strong enough to go by foot, money fetches me the dish and the mail-coach: that is, it converts my wishes from something in the realm of imagination, translates them from their meditated, imagined or desired existence into their sensuous, actual existence — from imagination to life, from imagined being into real being. In effecting this mediation, [money] is the truly creative power.

No doubt the demand also exists for him who has no money, but his demand is a mere thing of the imagination without effect or existence for me, for a third party, for the [others], and which therefore remains even for me unreal and objectless. The difference between effective demand based on money and ineffective demand based on my need, my passion, my wish, etc., is the difference between being and thinking, between the idea which merely exists within me and the idea which exists as a real object outside of me.

If I have no money for travel, I have no need — that is, no real and realisable need — to travel. If I have the vocation for study but no money for it, I have no vocation for study — that is, no effective, no true vocation. On the other hand, if I have really no vocation for study but have the will and the money for it, I have an effective vocation for it. Money as the external, universal medium and faculty (not springing from man as man or from human society as society) for turning an image into reality and reality into a mere image, transforms the real essential powers of man and nature into what are merely abstract notions and therefore imperfections and tormenting chimeras, just as it transforms real imperfections and chimeras — essential powers which are really impotent, which exist only in the imagination of the individual — into real essential powers and faculties. In the light of this characteristic alone, money is thus the general distorting of individualities which turns them into their opposite and confers contradictory attributes upon their attributes.

Money, then, appears as this distorting power both against the individual and against the bonds of society, etc., which claim to be entities in themselves. It transforms fidelity into infidelity, love into hate, hate into love, virtue into vice, vice into virtue, servant into master, master into servant, idiocy into intelligence, and intelligence into idiocy.

Since money, as the existing and active concept of value, confounds and confuses all things, it is the general confounding and confusing of all things — the world upside-down — the confounding and confusing of all natural and human qualities.

He who can buy bravery is brave, though he be a coward. As money is not exchanged for any one specific quality, for any one specific thing, or for any particular human essential power, but for the entire objective world of man and nature, from the standpoint of its possessor it therefore serves to exchange every quality for every other, even contradictory, quality and object: it is the fraternisation of impossibilities. It makes contradictions embrace.

Assume man to be man and his relationship to the world to be a human one: then you can exchange love only for love, trust for trust, etc. If you want to enjoy art, you must be an artistically cultivated person; if you want to exercise influence over other people, you must be a person with a stimulating and encouraging effect on other people. Every one of your relations to man and to nature must be a specific expression, corresponding to the object of your will, of your real individual life. If you love without evoking love in return — that is, if your loving as loving does not produce reciprocal love; if through a living expression of yourself as a loving person you do not make yourself a beloved one, then your love is impotent — a misfortune.

From the Economic and Philosophical Manuscripts of 1844

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Why Marx's conception of class still matters (continued)

In my previous post I roughly sketched what Marx's conception of class consisted of, keying in on the fact that it primarily has to do with the relationship of a group to the means of production. Now, I want to look at some examples of how this understanding helps us make sense of our current state.

To the extent that our society is still capitalist (based on wage labor, private ownership of the means of production, etc.), there is still a fundamental rift between workers and capitalists. Michael Zweig, in an article for Monthly Review, summarizes nicely one way to think about what the capitalist class looks like today:

The capitalist class are the corporate elite, senior executives, and directors of large corporations, whose job it is to give strategic direction to the company, who interact with government agencies and other corporate executives while leaving the day-to-day operation of their company to intermediate levels of management and the workforce. In this they are different from small business owners, who tend to work beside their relatively few employees and manage them directly. Capitalists make up roughly 2% of the population.

Zweig defines the working class as:

...those people with relatively little power at work -white collar bank tellers, call-center workers, and cashiers; blue-collar machinists, construction workers, and assembly-line workers; pink-collar secretaries, nurses, and home-health-care workers -skilled and unskilled, women and men of all races, nationalities, and sexual preferences. The working class are those with little personal control over the pace or content of their work and without supervisory control over the work lives of others. There are nearly 90 million working-class people in the US labor force today, thus the US has a substantial working-class majority (more than 62%).

Finally, Zweig understands middle class in the following way:

professionals, small-business owners, and managerial and supervisory employees. They are best understood not as the middle of an income distribution, but as living in the middle of the two polar classes in capitalist society. Their experiences have some aspects shared with the working-class, and some associated with the corporate elite. Small business owners share with capitalists an interest in private property in business assets, defeated unions, and weak labor regulations. But they share with workers in the work itself, great vulnerability to the capitalist market and to governmental power, and difficulty acquiring adequate health insurance and retirement security.

...Professionals are also caught in the middle of the cross fire...professionals closely intertwined with the working-class: community college teachers, lawyers in public defender offices or with small general practices, doctors in working-class neighborhoods, public school teachers...their economic standing have deteriorated along with the class they serve. But if we look at those whose lives are more fully involved in serving the capitalist class -corporate lawyers, financial service professionals, Big-Four CPAs, and doctors beyond the reach of HMO/insurance oversight -these professionals have risen with the class they serve.

Class, understood in this way, is an important critical tool because it scrutinizes the fundamental economic organization of society, rather than merely taking it for granted. It's not that we should not care about income disparities (and wealth polarization... which is far worse than income), but rather, that we must ask how such disparities arise. Moreover, income disparity cannot be the only metric. If we are concerned to understand fundamental political categories like emancipation, freedom, autonomy, power… we need to engage the fundamental structure/organization of the economic and social order.

This is what Marx was getting at, in the German Ideology when he said, “any distribution whatever of the means of consumption [i.e. income, material wealth] is only a consequence of the distribution of the conditions of production themselves. The latter distribution, however, is a feature of the mode of production itself.”

In other words, Marxists and radicals criticize left-liberals for only focusing on issues of distribution, or rather, only on re-distribution. That is, left-liberals focus on how best to re-distribute resources/incomes more justly given that the default allocation of the market is unjust. But, this leaves the question of the distribution came about entirely untouched… the liberals have nothing to say about production, social/economic relations as such, class power. Thus, liberals have no qualms with capitalism as such (to the contrary, they are supporters of it), but feel that justice requires ameliorating some of its ‘flaws’ (as though capitalism were a system set up to do anything other than create inequalities).

Alienation (estrangement) in the early Marx is a bit more difficult to make a short summary of, owing basically to its roots in Hegel. I think we can leave it aside here, because it’s not really central to the analysis of class in contemporary capitalist societies.

The current economic crisis is an excellent example of class power. There is a lot of legitimate resentment for the financial elite that has mismanaged huge institutions on which society currently depends (for better or worse... i would say for worse) a great deal. Even some nihilistic Leftists are taking the idiotic “Ron Paul” position on the bailout, claiming that these bankers “have made their bed, and now they should have to sleep in it”. But this crude position ignores the actual reality of how our society is organized.

As terrible a setup as it is, in our society capitalists (not democratic institutions) are put in charge of major economic institutions that determine the well-being of crucial sectors of the economy that aren't ostensibly related to the ‘financial industry’ proper. Worker’s jobs, pensions, savings, loans, mortgages, municipal budgets and college endowments are all tied to the health of the financial sector. Like it or not, this is an inescapable fact of our economy. Workers have no say in how these 'big' economic decisions get made, no way to demand that such decisions consider their interests.... yet they are totally vulnerable to the ramifications of these decisions in ways that capitalists are not (worst case scenario, corporate elites leave their powerful post with golden-parachutes). The answer can't be simply to 'punish' those who ran these institutions into the ground by letting these crucial institutions take everyone down with them.

We must make a crucial distinction between these institutions, and the class who runs them. The relevant ‘fuck you’, in this scenario, isn’t the one in which we flip off the institutions as well as the capitalists who own and control them… the only just 'punishment' would be to seize bank assets as well as these institutions under democratic authority, given that so much of society is forced into dependence on them.

Understanding the crisis in this light reveals a great deal of class power in this economic arrangement. Those who work for wages and have no say in the major financial decisions (made unilaterally in the speculative interests of capitalists), but they are also those who are hit the hardest when the capitalist's gamble doesn't pay off. And what's worse, the fact that capitalists own and control these crucial institutions translates to political power which they can use to pressure government into bailing them out of the mess they've made, leaving the vast majority of society out of the picture. The only sense in which the working majority is invoked in the deliberations among elites about 'solutions', is when the viability of these financial behemoths is endangered enough to threaten negative ramifications far beyond Wall Street.

So here are two instances of massive class power:

1. Capitalists, who own and control these financial titans, have power that derives from the leverage that comes along with controlling an institution on which the fate of society in large measure depends.

2. The State, light-years from being an institution that represents the majority of working people, is already predisposed to side against workers in favor of Capital.

It’s true, the old caricature of a top-hat wearing capitalist factory-owner beating down a bunch of soot-covered production-line workers is not the image we have of most working Americans today (although this situation is still hardly passé for a very real number of factory workers in the US, and far more in the Third World). It’s also hard to see how machinists and bank tellers have much in common, when we think of consumption habits, style and ideology. But taking a broader view of society makes it clear how disempowered both are.

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Why Marx's conception of class still matters

It is certainly true that the class structure of capitalist societies has changed a great deal since the 1840s (when Marx was writing his early works, such as the bit quoted by Arvilla which comes from his 1844 Economic and Philosophical Manuscripts). There is also no doubt, any meaningful Marxist analysis of capitalism as it exists today, would look a great deal different than the critique offered by Marx in the 19^th century.

Nonetheless, Marx’s definition of class is no less relevant today than it was in the 19^th century.

As Gwen notes in the bit Arvilla quotes, there is a marked difference in the Marxist understanding of class, and the way the term is used in North America. Let me try to critically distinguish them. In most American discourse, class is roughly equivalent (if not reducible to) the amount of money one earns in terms of income. Class, on this view, also has to do with the attendant consumer preferences, cultural convictions and styles that often accompany the amount of money one has. In its most crude formulation, this conception of class boils down to the ‘gap between rich and poor’.

In contrast, the notion of class that Marx developed was not at all reducible to earnings. Marx defined class in terms of one’s relationship to the means of production. While class in this sense is correlated with wealth/income, it is not reducible to it. One simple contrast between the crude American conception and the Marxist conception, is that for Marx, class is to be understood in terms of power (rather than income). It has to do with the distribution power in economic relationships relative to the way that production is organized. (Note, this is also how many radical thinkers [I'm thinking Judith Butler, for instance] understand gender: not in terms of essential characteristics, but as a power relationship).

Capitalism, is a form of social production dominated by wage labor, that is, the use of labor-power sold by those controlling no significant means of production.

In the Communist Manifesto, Marx gives the most rough and ready summary of his definition of the two most opposed classes in capitalist society, proletariat and bourgeoisie. There, the proletariat is defined as “those who live only so long as they find work, and who find work only so long as their labor increases capital.” The bourgeoisie, in turn, is defined as “a group whose income derives from the sale of commodities produced with the purchase of labor-power”. Labor-power is the capacity to do work. Notice, in the labor market, this is the only thing the wage-laborer has to offer in seeking to earn a living.

Another way to understand this is the following. Capitalists are the purchasers of labor-power, the working-class (the proletariat) are those who sell themselves to capitalists by the hour in order to earn a wage from their capacity to labor, to produce for the capitalist.

These two classes are of particular interest to Marx, because they are relatively new; features of industrial capitalism and not previous societies. Before industrial capitalism came into its own, there were still middle-classes (i.e. professionals, such as doctors, lawyers, etc.) and petty-bourgeois (those who own means of production, but on a small scale, where they usually end up doing a lot of the work themselves… think newspaper-stand or convenience-shop owners). Most professionals have “bourgeois” lifestyles, but this is only in rough terms of their levels of consumption. The interests of professionals (the middle class), despite their consuming habits, are often threatened by capitalist/corporate control of government institutions. Were they to stand up and demand something contrary to the desires of capitalists, they would be little better off (though, obviously still in a better position) than workers in trying to exact concessions and compromises from the ruling class. The middle classes and petty-bourgeoisie are better off than workers, but they aren’t therefore in a position of power in terms of their relation to the means of production. They aren’t in charge of the big cogs on which the economy runs, they aren’t able to move enormous amounts of capital at the drop of a hat, the yaren’t entrusted (as capitalists are) with providing employment or ruling the major productive and financial institutions in society. They are in a better position than workers because of their affluence, but let us not forget their position relative to way that production is organized in capitalism.

Marx is interested primarily in the proletariat and the bourgeoisie because they are new developments, and what’s more, because their interests are fundamentally conflicting.

Why is this? Because the capitalist seeks only to do one thing: maximize their profits. Labor is only one of the costs of running their business, and if profits are to be made as high as possible, it is best purchased at the lowest cost. This is very intuitive: under market conditions, buyers (capitalists) want to buy cheap, and sellers (workers) always want to sell high.

But contrary to the assumptions of neo-classical economics, this market transaction is by no means a free and fair one. Many of these points are astutely noted by Marx in the 1844 manuscripts. For instance, the sellers (the working-class) are burdened with special inequalities:

-they are forced to sell their labor power to survive

-they cannot manipulate technology (as capitalists can) to reduce their need for steady employment

-capitalists are under no urgent pressure to employ workers, they don’t fear going hungry or losing a home.

In contrast, capitalists not only are free from these burdens, they have all sorts of benefits at their disposal:

-they have purchasing power that far exceeds what is required for individual consumption

-they have greater access to credit than workers

-they have reserves against future losses (in contrast, when tough times hit, the working class does not have such reserves, because they are forced to spend most of their meager earnings in order to subsist)

-they have funds at their disposal for research and development

-they have resources for underselling and advertising

Thus, the interests of these two classes are fundamentally opposed, but they are not therefore equally empowered (as we’ve seen). Capitalists, under pressure of competition, are compelled to reduce the cost of labor as much as possible, thus the tendency of capitalists production is to sink the average standard of wages. (notice, that since the rise of neoliberalism in the early 70s, real wages have not only stagnated, they’ve actually dropped from their 1968 high water mark). The trouble is, laborers are human beings, not reducible or exchangeable with other raw-materials and commodities which capitalists purchase in order to create products to sell for a profit. But capitalism is not a system fundamentally concerned with human development as such, it is a system fundamentally driven by callous accumulation of profits.

Marx, in his analysis of the capitalism of his day, by no means thought that there were only two classes in society; rather, he emphasized the two classes that he felt made capitalism distinctive, that were most fundamentally opposed. Against the views of the classical economists and early liberal political theorists, Marx saw that although the replacement of feudal class arrangements with liberal capitalism was an improvement, capitalist society was nonetheless still a class society (although of an altogether different sort) which made it fundamentally opposed to a free society.

Capitalism has changed, however, and therefore so must our conception of class. I can’t finish this post right now, but sometime soon I will try to finish this thought by looking at how much of the Marxist conception of class is still worthwhile, by looking at a few examples (such as the current crisis, for instance).

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Defining "working class"--why the Marxist definition seems so strange now

Gwen at High on Rebellion has a thoughtful post about her understanding of working-class as an economic state, as opposed to the traditional Marxist understanding, which suggests one is working-class defined by the worker's lack of ownership over the means of production. This Marxist notion seems a little irrelevant to Gwen:

One thing I find really interesting and sometimes really upsetting about Britain in general and the British Left in particular is that everyone but me and Tony Benn identifies as working-class. At the Marxism conference a few years ago, I attended a session discussing “non-productive labour”, which I interpreted to mean people working in call-centres and similar areas. Imagine my surprise then when university lecturers and senior civil servants start discussing the difficulties they face as non-productive labourers and members of the working-class generally.

(...)

I don’t think the traditional Marxist definition is very useful today, because it erases the genuine economic privilege held by a lot of people who don’t own the means of production. There is no comparison between lecturers and call-centre workers. Solidarity is not going to spontaneously appear between those two groups. Furthermore, it’s not clear that those two groups HAVE much in common. Is a middle-class lecturer going to vote to increase her taxes to provide cheap housing for a call centre worker? We know for a fact that a lot of them don’t.

The reason for the dissonance between my idea of class and the Marxist definition is a great example of this. Most radical leftist North Americans would use my notion of class. The cradle of parliamentary socialism in Canada is the Prairies - farmers who could only make ends meet if they all worked together started a political party. Socialised medicine in Canada basically started as towns pooling their resources to pay for a doctor who would then see anybody as required - because no one in town could afford a doctor by themselves. But by the Marxist definition of class, these farmers - who were up to their ears in debt, and there was a depression and a drought happening simultaneously - were petit bourgeoise, ‘cause they “owned” the farms and farming equipment (usually heavily mortgaged) and as such did not sell their labour but owned the means of production. The fact that they were dirt poor doesn’t seem to matter.

Being a relative newbie to Marxist theory myself, I'll admit I have trouble making sense of the resonance of talking about working class (as defined by means of production). It's not that we can't still divide people up based on their relationship to the means of production, it just seems a little pointless. Sure, in the industrial revolution there really were two major classes that mattered: those that owned the means of production, and those who lived tedious lives by producing capital for those who owned the means of production. The tragedy of being the proletariat isn't just about the living conditions the proletariat faces by not owning the means of production, but it's about a metaphysical problem created by this relationship to capital. The argument, as far as I can recall (and I may be doing it a great injustice here) is that the tragedy of not owning the means of production isn't just poverty in the sense we know it, but because it leads to objectification and estrangement: (From Marx's Economic and Philosophical Manuscripts)

Labour not only produces commodities; it also produces itself and the workers as a commodity and it does so in the same proportion in which it produces commodities in general.

This fact simply means that the object that labour produces, its product, stands opposed to it as something alien, as a power independent of the producer. The product of labour is labour embodied and made material in an object, it is the objectification of labour. The realization of labour is its objectification. In the sphere of political economy, this realization of labour appears as a loss of reality for the worker, objectification as loss of and bondage to the object, and appropriation as estrangement, as alienation.

So much does the realization of labour appear as loss of reality that the worker loses his reality to the point of dying of starvation. So much does objectification appear as loss of the object that the worker is robbed of the objects he needs most not only for life but also for work. Work itself becomes an object which he can only obtain through an enormous effort and with spasmodic interruptions. So much does the appropriation of the object appear as estrangement that the more objects the worker produces the fewer can he possess and the more he falls under the domination of his product, of capital.

All these consequences are contained in this characteristic, that the worker is related to the product of labour as to an alien object. For it is clear that, according to this premise, the more the worker exerts himself in his work, the more powerful the alien, objective world becomes which he brings into being over against himself, the poorer he and his inner world become, and the less they belong to him. It is the same in religion. The more man puts into God, the less he retains within himself. The worker places his life in the object; but now it no longer belongs to him, but to the object. The greater his activity, therefore, the fewer objects the worker possesses. What the product of his labour is, he is not. Therefore, the greater this product, the less is he himself. The externalisation of the worker in his product means not only that his labour becomes an object, an external existence, but that it exists outside him, independently of him and alien to him, and begins to confront him as an autonomous power; that the life which he has bestowed on the object confronts him as hostile and alien.

Let us now take a closer look at objectification, at the production of the worker, and the estrangement, the loss of the object, of his product, that this entails.

The workers can create nothing without nature, without the sensuous external world. It is the material in which his labour realizes itself, in which it is active and from which, and by means of which, it produces.

But just as nature provides labour with the means of life, in the sense of labour cannot live without objects on which to exercise itself, so also it provides the means of life in the narrower sense, namely the means of physical subsistence of the worker.

The more the worker appropriates the external world, sensuous nature, through his labour, the more he deprives himself of the means of life in two respects: firstly, the sensuous external world becomes less and less an object belonging to his labour, a means of life of his labour; and, secondly, it becomes less and less a means of life in the immediate sense, a means for the physical subsistence of the worker.

Now personally, I'm never particularly compelled by arguments like this. And I'll admit, I can't really defend why it is that I wouldn't be moved by this argument, when I certainly can't reject the logical rigor or make a good argument for why this wouldn't happen to a laborer and wouldn't be a problem. It could and it might be. This was a good argument at the time, because the poor people were the same as those who had no access to the means of production and the wealthy or bourgeois people were the people who owned the means of production. So not only were those without the means of production suffering from material deprivation, but they were also suffering alienation and estrangement as a result, which made these spiritual problems more to compound the horror of the material problems for laborers. It was an industrial economy so the lines were much more clearly drawn.

But nowadays, as Gwen points out herself, dairy farmer friends of mine or my friends who own a glass cutting firm, yet barely scrape by, control the means of production, whereas, the accountants in my office make a quarter million dollars a year, have a lot of leisure time, take their families on vacation, are by Marx's definition, proletariats, because they don't own the fiber optic network we operate on.

This isn't to say the problems of estrangement and alienation aren't still a problem for even these accountants, because they have an estranged relationship to the product (in this case, as us the case in our late-capitalist economy, a service) their labor provides. And this isn't to say that having these relationships to the means of production, even if the laborer makes a comfortable income, isn't worth a revolution simply because of the estrangement and alienation. But when it comes to a scenario like Gwen mentions where she's listening to academics talk about what it's like to be "working class," I too have to wonder if this reliance on Marx's definition isn't an attempt to throw a pity party for privileged people and isn't more than a little offensive in light of the very real and very starkly different material conditions academics have as opposed to, say, my roommate who has worked as a fruit sorter for 5 years and just got a raise to $12/hour...

Something about it strikes me as sort of...well...who cares all that much about estrangement and objectification when there is such stark material inequality. In the case, as it is now, when Marx's classes don't line up with level of access to resources, I have to question the use of Marx's definition any more.

But, I have to wonder if Gwen and I haven't misunderstood something about the use of these terms and Marx's definition and how it would apply today...

I'm hoping T or some other friendly Marxist passerby can shed some light on this for us.

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