KOREA COLUMN 27
Capitalism first began to emerge, within feudalism, in Europe and elsewhere, as long ago as the fourteenth century. Through a long series of struggles, revolutions and wars capitalism established itself as the dominant mode of production in Europe by the beginning of the 19th century. It was at this point that Karl Marx became the first person to produce a comprehensive analysis of capitalism’s structure and laws of development. It is useful to compare capitalism today with capitalism in Marx’s time to see what has changed and what remains the same.
The most immediately obvious change is in capitalism’s scale of operation. In the 1840s, when Marx began his analysis, capitalism may have been dominant in Europe but in its developed industrial form it was still more or less confined to a small corner of the north-west – Britain, The Netherlands, Belgium, parts of France and Germany. Today it is truly global.
Capitalism, by means of trade and, indeed, its armed forces, long ago ‘reached’ and affected virtually everywhere but now there is probably no country on the planet where the majority of goods are not produced on a capitalist basis. In 1848 Britain, the so-called ‘workshop of the world’, was by a long way the leading economic power, with France its nearest rival. By the end of the 19th century Germany had displaced France and the USA was advancing swiftly. By the end of the First World War the United States had clearly overtaken not only Britain but all of Europe. By the end of the Second World War US dominance was even more entrenched, with the state capitalist USSR its only serious challenger.
Today the USA remains economically, and, of course, militarily, dominant but, despite its victory in the cold war, its economic lead over the rest of the world is much diminished. In the fifties and sixties ‘economic miracles’ in Germany and Japan put America under pressure and now there is the emerging challenge from China, with India also making huge progress. In addition there are numerous significant and independent centres of capital accumulation, such as South Korea and Brazil, dotted round the world. Capitalism has thus ‘filled up’ the world more completely and is more poly-centred than ever before.
Along with this geographical spread has gone a huge increase in the size and range of capitalism’s major corporations – the Exxon Mobiles and Wal-Marts, the Toyotas and Samsungs – in other words in the concentration of capital, and in the intensity of global economic integration. It is not simply that the international transportation and sale of raw materials and manufactured goods has grown immensely but that the actual manufacture of individual commodities has become an international process.
The growth of the system has been anything but smooth, passing through severe international crises such as the Great Depression of the thirties and the international recessions of the seventies and eighties, and numerous national or regional upsets, nevertheless overall it has been massive.
The economic role of the state has also generally increased substantially, but again the process has been extremely uneven. Since the onset of neo-liberalism in the seventies and the ‘collapse of communism’ in 1989-91 the role of the state has clearly declined compared to the days of Hitler, Stalin, Roosevelt and Keynes, but not nearly as much as neo-liberal ideologues expected or wanted.
Another major change has been the rise in the average standard of living of the masses, first in the advanced industrial countries of the so-called West, and second in a significant number of newly industrialising countries. Cross-cultural statistics on living standards are tricky and unreliable, but figures on life expectancy give the broad picture. In 1850 in the US life expectancy for the average white male was 38 years, and for white women, 40 years. By 2001 that had risen to 75 years for men and 80 years for women. In countries such as Canada, Sweden, France and Australia it is similar but even higher, while in Mexico, Brazil, Poland and even China it is now over 70.
Viewed superficially and one-sidedly these changes could be seen as a success story for capitalism. However, what has remained unchanged is even more basic than what has changed. First, the fundamental social relations of production are the same. The main forces of production are still owned and controlled by tiny minorities who produce in competition with one another, on the basis of the exploitation of those who live by the sale of their labour power The immediate producers remain alienated from their labour and the products of their labour – they produce a world not under their or, ultimately, anyone’s control. Society is divided into antagonistic classes – bourgeoisie and proletariat – whose interests are diametrically opposed. Second, the fundamental dynamic of the system also remains unchanged; it is the same in China today as it was in Britain in the Industrial Revolution, namely the drive to accumulate capital i.e. to pursue profit before human need.
Precisely because of this underlying continuity all the changes in capitalism described above have their dark or negative side.
The rise in living standards, though real, has been massively uneven – using again the measure of life expectancy we find, for example, Angola on 37, Mozambique on 40 and South Africa on 42.5 – and accompanied by rising inequality, both within nations and between them. In the US in 1980 the pay of company Chief Executives was 42 times that of a production worker; by 2000 it was 525 times greater! In 1998 the United Nations Development Program reported that the world's 225 richest people now have a combined wealth of $1 trillion which is equal to the combined annual income of the world's 2.5 billion poorest people and the wealth of the three richest individuals now exceeds the total GDP of the 48 poorest countries.
The economic growth experienced by capitalism has been paralleled by a growth in its destructive tendencies. In terms of wars and mass slaughter the 20th century was, by a huge distance, the most costly in history and today the capacity to eliminate human life is greater than ever. The emergence of the US as sole super power (and the potential threat to its position from China) has made it more not less inclined to use and threaten military force. To this must be added the devastating threat capitalism poses to the environment, and thus the future of humanity, through climate change.
But by far the most important consequence of the apparent international ‘triumph’ of capitalism has been, precisely as Marx foresaw, the production, in greater numbers with greater geographical spread.(from South Korea to South America), concentrated in ever growing giant cities (from Kolkata to Cairo), of its own gravedigger – the international working class.
July 23 2007