The ‘base-superstructure’ metaphor has caused much controversy in Marxist circles. Some argue that Marx means by this that ‘the economy’ determines other spheres of life. Specifically, this usually means productive technology. These authors say argue in favor of technological determinism: technology determines social relations. Others argue that the base cannot be defined so narrowly and that it makes no sense to speak of some actions that are ‘economic’ and others that are ‘legal’ or ‘religious’ or whatever. They argue against technological determinism and instead suggest that the base is really all human activity, and that the superstructure is how society appears to consciousness. These two interpretations (i.e. technological determinism and non-deterministic readings) are held by the scientific and humanist Marxists, respectively, as discussed by Gouldner.
Capitalism is really ‘socialism for the rich’; profits are privatized, but costs and toil are ‘socialized’. According to Marx, more and more people become members of the proletariat class. Serfs in feudalism are dispossessed: they are kicked off of their land. They now have to work in the factories, or starve! Small businesses are also swallowed by giant firms, putting them out of business. Think Wal-Mart.
Quote from Sowell (1985: 54)
Arbitrage occurs whenever someone takes advantage of prices differences (e.g. across geographical areas or in a market where information on prices isn’t universally or equally accessible), and buys a product for a low price and then re-sells that same product for a higher price. In most models, this sort of trading is assumed out of existence, i.e. prices for the same goods are assumed constant.
Note: ‘living labor’ is in contrast to ‘dead labor’, labor from the past embodied in machines. For Marx, all new value is created solely by living labor, whereas machines merely transmit their existing values to the end product.
Absolute surplus value (i.e. making workers work longer) was important during the early days of capitalism. This mode of exploitation does not change the production process itself. Relative surplus value (i.e. increasing productivity) corresponds to mature capitalism; entails the mechanization of production.
Marxism<br />Shorter and Revised<br />Use this and glossary as a Study Guide<br />
Karl Marx and Conflict Theory<br /><ul><li>Father of modern socialism, communism, and conflict theory.
Marxism is a Western intellectual tradition spanning 150 years, consisting of 3 components:</li></ul> A political doctrine<br />A philosophy (or anti-philosophy) of History<br />and an analysis of the functioning of the economy<br />1818-1883<br />
Materialist Theory of History<br />Question: What is more important than what people in a society think and believe? <br />Answer: What they do and make!All people everywhere have to produce their means of ‘subsistence’ (livelihood).<br />Production is primary: it is a necessary precondition for everything else. You must be fed before you can philosophize!<br />
Materialist Theory of History<br />How stuff is produced is what matters most. This is the ‘base’ of society. Marx calls the rules, customs, laws, and beliefs determining how the wealth should be distributed, the superstructure.<br />“Economic base” (from book, pg 73): “Economic relations determine social relations, and social institutional practices (i.e. superstructure).” [see note below!]<br />
Materialist Theory of History<br />Every society produces a surplus, and has different rules for determining how this surplus wealth is distributed. <br />Marx says that people’s way of producing a surplus influences (or ‘determines’) their ideas about how to distribute the surplus<br />
Marx’s Historical Materialism <br />Human beings form ideas under the influence of circumstances. Such ideas then compel them to change circumstances. There is free will, but history is not determined by these freely willed intentions. The point of theory is to predict results, not intentions. <br />Marx does see a logic(= pattern) underlying historical changes, but these patterns cannot be consciously understood by individual actors without theory!<br />
Materialist Theory of History<br />As productive technology changes, so too do people’s relationships to each other.<br />After the Industrial Revolution, we get totally new class relations! Serfs and lords are replaced with wage-laborers (the proletariat) and their bosses (the bourgeoisie).<br />Industrial Europe<br />Feudal Europe<br />
What is capitalism?<br />For Marx, Capitalism is a social order characterized by two conditions:<br /> Things (‘commodities’) are produced for salein order to make a profit. <br />“For Sale” and not for immediate use or consumption. <br />“For profit” and not according to custom, need, tradition, or to maintain a fixed standard of living. <br />M-C-M’: The Circuit of Capital<br />
What is capitalism?<br />Production is based on wage-labor, i.e. people who, in order to survive, must sell their capacity to work in exchange for a salary or wage. These workers do not <br />own the machines that they use (‘the means of production’), <br />own the wealth that they produce, <br />nor do they acquire the profits made from the sale of that which they produce!<br />
Capitalism as a Conflict of Interests<br />Capitalism arises with industrialization, when production itself becomes “socialized”, requiring large numbers of people, operating machinery. <br />Control of what is produced, however, is privatized, or centralized in the hands of the few , for private gain.<br />A conflict of interest develops between workers (the proletarians) and the owners (the bourgeoisie) of the machines or ‘means of production’<br />
Exploitation in capitalism<br /><ul><li>For Marx, capitalism is inherently exploitative. There is a conflict of interest because workers produce the wealth, but receive in wages only a fraction of the wealth (or ‘value’) they produce. This is exploitation.
The value that workers produce over and above what they receive in wages is known as SURPLUS VALUE. </li></ul>Equality is only a mask,<br />or appearance<br />
Inexorable Collapse of Capitalism<br />The development of modern industry … cuts from under its feet the very foundation on which the bourgeoisie produces and appropriates products. What the bourgeoisie therefore produces, above all, are its own gravediggers. Its fall and the victory of the proletariat are equally inevitable” (CM)<br />Why?<br />
Inexorable Collapse of Capitalism<br />Capitalists compete for faster growth and larger market share. Each capitalist tries to expand by increasing output and reducing costs. Hiring more workers causes wages to rise! <br />Because wages are an expense, and inversely related to profits, capitalists try to keep wages as low as possible. They also introduce labor-saving machinery to increase output and reduce costs of wages, creating more unemployed (reserve army of labor).<br />
Inexorable Collapse of Capitalism<br />Consequences:<br />Crisis of Over-production (aka Under-Consumption)<br />Profit motive causes wages to fall too low and unemployment to rise, so that the people don’t have enough money to buy the stuff they produced! <br />Falling rate of profit<br />According to Marx, profit (surplus value) ultimately derives from living labor, not machines. This means that mechanization of labor replaces profitable production with non-profitable production processes.<br />
Inexorable Collapse of Capitalism<br />Businesses have no choice: they must grow or die.<br />Each collapse is worse than the previous… <br />Falling Profits, <br />Under-Consumption, <br />Unemployment<br />
Inexorable Collapse of Capitalism<br />Predictions:<br />Concentration of Capital (Monopolization) as big firms bankrupt or buyout small businesses and each other<br />Declining profits <br />According to labor theory of value, profits derive ultimately from living labor, not machines<br />Under-consumption (aka Over-Production): <br />Workers cannot afford to buy the stuff they make.<br />Increased unemployment due to mechanization<br />Cyclical recessions/depressions<br />
Fetishism of Commodities<br />Fetish: an object (as a small stone carving of an animal) believed to have magical power to protect or aid its owner; broadly: a material object regarded with superstitious or extravagant trust or reverence <br />Marx extends the critique of religious fetishism to the fetishism of commodities and economic relations. He argues that we tend to ‘reify’ (i.e. treat as a thing outside of us) our own relationships. Capitalism then ‘takes on a life of its own.’<br />
Alienation (traditional interpretation)<br />Alienation = separation<br />Separation of yourself from:<br />the product of your labor<br />Other People (‘anomie’ for Durkheim)<br />Yourself<br />Nature<br />Origins of this condition are material, in how we produce things. <br />
Alienation as Collective Fetish<br />Collective self-domination. <br /><ul><li>Alienation for Marx basically means that “society” dominates the individuals that produce it. It is similar to the idea of Frankensteinor opening Pandora's box.
Marx thinks that capitalism creates new historical possibilities for realizing human freedom, but capitalism does not actualize these possibilities. </li></li></ul><li>‘Opium of the People’<br />‘[Religion] is the opium of the people’- Karl Marx<br />Quote in Context:<br />Religious suffering is, at one and the same time, the expression of real suffering and a protest against real suffering. Religion is the sigh of the oppressed creature, the heart of a heartless world, and the soul of soulless conditions. It is the opium of the people.The abolition of religion as the illusory happiness of the people is the demand for their real happiness. To call on them to give up their illusions about their condition is to call on them to give up a condition that requires illusions. <br /> - Marx, Critique of Hegel’s Philosophy of Right. Introduction (1843)<br />
‘Opium of the People’<br />“Opium of the people” does not only mean that religion is only a justification for suffering in this life for glory in the next.<br />Opium was the medicine of choice in the 19th century, prior to the invention of aspirin, tylenlol, and ibuprofen, and it was effective. <br />Marx argues that religion is the best ‘cure’ available for alienation in an alienated society. The only truly effective cure would be to abolish alienation and create a society where people have some rational control over the social forces they are producing.<br />
Ideology and ‘False Consciousness’<br />Ideology = (from book, pg. 73): “ideas in everyday circulation; determined by the ruling class such that they make our current social existence seem normal and desirable.” <br /> When particular interests of the few are understood falsely to promote the general interest (or common good), Marx calls this false consciousness. Workers who possess ‘false consciousness’ act against their own best interests.<br />
Marx’s Two Theories of Ideology<br />Ruling ideas are imposed on lower classes<br />Explains persistence of capitalism<br />‘economic structure of society, the ‘real foundation’, determines a legal and political superstructure’; and ‘the ruling class are in every epoch the ruling ideas...’<br />Each class has its own ideology<br />Explains how revolution will become possible<br />‘Social being determines consciousness’<br />Interpreted as: ‘social class’ determines consciousness; therefore each class should have its own ideology, and system of beliefs!<br />
Profit and Exploitation<br />From where does profit as a whole arise?<br />Buying low and selling high? <br />In the aggregate, total value remains the same. Whatever one person gains by selling high, another loses by buying high! These gains and losses balance out.<br />
Profit and Exploitation<br />The source of profit as a whole in capitalism is the creation of surplus-value by living labor.<br />Profit arises from the difference between the time required to reproduce the livelihood of workers, and the time workers actually spend at work. This “extra time” is what capitalists pocket.<br />Pocketing Time<br />
Surplus Value Definitions<br />A surplus arises when the value of a worker’s labor-power is less than the value that labor produces during production. This difference is called surplus-value, and it is also the time spent working in excess of the amount of work required to reproduce one’s livelihood. Surplus-value is thus surplus-labor time and is the primary source of profit in capitalist society, according to Marx. <br />
Two modes of exploitation<br />Absolute surplus value = lengthen the working day without a corresponding increase in labor compensation (i.e. Work Longer)<br />Relativesurplus value = decrease the necessary labor time needed to reproduce labor-power. This is accomplished by cheapening the value of labor-power by increasing productivity. (i.e. Increase productivity)<br />1. Lengthen Working Day<br />Necessary labor-time<br />Lengthen<br />Surplus time<br />2. Increase Productivity<br />Shortern<br />Necessary labor-time<br />Surplus time<br />