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MARX V. MAINSTREAM
Anyone curious about monopoly business practices will learn a lot from the operations of the economics profession, where the chances of finding a heterodox economist, to say nothing of a self-identified Marxist, are close to zero. The mainstream has established a de facto monopoly of its corner of the knowledge market, one that extends across the length and breath of institutional life in the US, from the halls of academe to research institutes, think tanks, the business world, corporate media, non-governmental organizations and the public sector.
What do these monopolists have to say about the economic system that controls our lives? If you were a college freshman required to take Econ 101, what would you be likely to hear on the subject of capitalism?
In search of an answer, I clicked on the website of the International Monetary Fund, the tough-love enforcer of fiscal austerity and structural adjustment across most of the planet today. The IMF is a go-to source for official wisdom on the dismal science by virtue of its status as a financial cornerstone of the global economy, described in glowing terms by the World Economic Forum as "the world's financial firefighter." The Forum is speaking for the global elites who converge on Davos every year, projecting confidence and competence but, in truth, terrified at the thought that the financial system in which they are deeply invested could go up in flames at any time. The IMF's job is to keep borrowers in line, lenders in the black and the Davos crowd in high spirits.
I ordinarily try to steer clear of the IMF and the World Economic Forum for the same reason that I avoid SWAT teams, bill collectors and the IRS. But I decided to make an exception in this case because I wanted to eavesdrop on what the masters of the universe are saying about capitalism.
I came across an essay titled, "What Is Capitalism?" Bingo!
The authors of this piece provide a convenient list of what they call the six "pillars of capitalism": private property, self-interest, open competition, the market mechanism, individual freedom and small government.
The first four of these items would make the cut in most definitions of capitalism, Marxist and mainstream alike.
But the last two are debatable, to put it mildly. "Individual freedom" has a particularly discordant ring. In the mainstream view, it basically boils down to the freedom of a capitalist to invest his money and run his business as he sees fit and the freedom of a worker to spend her paycheck or max out her credit card on whatever she wants. This is a pretty stingy conception of freedom when you take a moment to reflect on the billions of people worldwide who have neither money to invest, businesses to run, paychecks to spend, nor credit cards to max out.
And what about "small government"? The last three centuries of world history provide ample evidence, in my opinion, that capitalists and the economic system that underwrites their power are perfectly happy with big government, indeed the bigger the better, as long as it serves their interests.
The acid test of any theory or concept is how well it explains the subject under investigation. So, it seems fair to ask how well the IMF's six pillars explain the world in which we live, a world that both mainstream economists and Marxists readily agree is dominated by capitalism. For example, how well do the pillars stand up under the weight of the following developments on the global stage:
(1) the ever-expanding global working class which keeps consumer markets in the US and Europe filled to overflowing, despite earning low to subsistence-level wages under exceedingly difficult working conditions;
(2) the unprecedented pace of worldwide urbanization as rural populations pour into the favelas and shanty towns of Latin America and Africa, the booming megalopolises of East and South Asia, and the aging capitals of the Global North whose basic infrastructures are nearing their expiration date;
(3) the militarization of national borders in the historic heartland of capitalism as desperate populations seek better jobs, new lives and relief from the ravages of climate catastrophe and IMF-imposed fiscal austerity;
(4) the deepening legitimacy crisis of neoliberal governing regimes in the advanced capitalist world, as expressed in a pervasive sense of alienation from established political parties and practices which have been in place since the end of the Second World War;
(5) the surge of ethno-religious-national hatreds as increasingly marginalized populations circle the wagons in a desperate effort to protect themselves against the zero-sum game of capitalist globalization and super-power rivalries;
(6) the constant threat of future economic crisis and social havoc, similar to what was experienced during the financial meltdown of 2007-2008 and the COVID-19 recession, both of which created fertile soil for the rise of all manner of right-wing demagoguery and revanchist politics;
(7) the continued upward trajectory of greenhouse gas emissions which poses an immanent threat to planetary life and is fueled by the growth imperative or what Marx would characterize as capitalism's logic of "accumulation for accumulation's sake."
The mainstream would say that the trouble spots I have flagged, while regrettable, have little if anything to do with capitalism. Far from being the cause of the cascading calamities engulfing the planet capitalism gives us the best chance of solving them, provided that we put in place the proper set of economic incentives enabling the invisible hand of the market to do what it does best, namely allocate scarce resources efficiently and for the betterment of all.
That the perilous state of the world might have something to do with the internal contradictions and crisis tendencies of capitalism is dismissed out of hand by the mainstream. Whatever problems exist are external, not internal, to the economic system under which we live.
This is an ideological blind spot. In the last tab, I defined ideology as "the appropriation of values and norms in order to buttress social power." Is the IMF appropriating the positive values and norms that attach to the terms "individual freedom" and "limited government" in order to buttress the social power of capitalist class interests, particularly those that have taken up lodging in the financial sector, where the IMF has a penthouse suite with breathtaking views of the global economic order?
Yes, I believe it is.
Ideology can take a variety of forms, according to the balance of class forces on the ground. It can celebrate the dominant power arrangements as the best for all concerned, divert attention from them through tried-and-true techniques of misdirection or simply pretend they don't exist.
The IMF definition checks off all three boxes, but it's the last one that really jumps out. In making the case that capitalism is the nursery of individual freedom and small government, the mainstream must tiptoe around what Marx calls "the hidden abode of production" aka the capitalist workplace.
It's easy to understand why. The moment wage workers step inside the capitalist workplace, they leave any semblance of freedom behind. Whatever freedom they might enjoy as consumers in the marketplace does not carry over into the workplace. True, workers are always looking for ways to exercise their freedom at the point of production through individual and collective acts of resistance. But in doing so, they invariably run up against the written and unwritten rules of the capitalist workplace, rules that, when push comes to shove, will be strictly enforced by the repressive apparatus of the state, from judges with their injunctions down to cops and soldiers with their guns.
So much for individual freedom and small government.
In his sustained critique of bourgeois political economy, Marx points out that the problem with definitions of the IMF variety is that they dwell on surface appearances and external forms, which are then posited as universal and timeless characteristics of what humanity is or at least ought to be. Such approaches easily slide into a kind of essentialism in which the roots of capitalism are traced to something called human nature or what Adam Smith characterized as our species-specific "propensity to truck, barter, and exchange."
Naturalizing capitalism is precisely what unifies the bourgeois political economy of Marx's day and the mainstream economics of our own.
Mistaking surface appearances for the real thing can be dangerous, as anyone who has spent time at the beach knows. We might not be able to see the riptide from our comfortable spot under the umbrella, but it's terrifying reality will become instantly clear the moment we decide to take a nice cool dip.
To the best of my knowledge, no one has ever likened Marx to a lifeguard. But perhaps the analogy is not as far-fetched as it sounds. Suspended between heaven and earth in his lifeguard tower that gives him a bird's-eye view of the crowded beach, Marx has raised the red hazard flag. If we heed his warning and look beneath the placid surface of capitalism to its turbulent depths, what we will see is not the IMF's self-equilibrating mode of exchange but Marx's contradiction-ridden mode of production.