Belfast Telegraph

Dr Esmond Birnie: What can Karl Marx teach us 200 years on from his birth?

Economy Watch

By Dr Esmond Birnie, NI economic policy centre

About 30 years ago, I was studying the productivity of factories in Northern Ireland and Germany. In a factory in Northern Ireland, the manager told me he liked to employ husbands and wives together because that gave him much more scope to control their work effort - that attitude would not have been out of place amongst some of the examples Karl Marx used in his enormous book, Capital.

A later research visit was to a cigarette factory in Dresden, Germany. The manager there showed us the files kept on the workers by the Stasi police during the Communist period.

He also bemoaned how during that time, workers had been moved back and forth between that factory and one making cameras. There was little regard for efficiency or product quality.

Two hundred years on from his birth in the German city of Trier, interest in Karl Marx is reviving.

Given the enormous amount he wrote, summing up his life's work in 800 words may seem arrogant or risky.

However, let us ask what is still valid about Marx and what should be put into, to use Trotsky's phrase, "the dustbin of history"?

"Good" Marx

Economics, as some of us have learnt it or taught it, can be quite a narrow subject area where certain things are assumed as a given, such as the distribution of power or wealth in a society. Marx had a grand sweep.

Leaving to one side the question of whether he achieved his ambition, Marx wanted to explain the whole of human history and areas as diverse as politics, family, art and religion.

He correctly identified some of the emerging trends within mid-nineteenth century capitalism: growth of big and monopoly businesses and the advance of technology.

He thought it was inevitable that employers would seek to squeeze ever more output or "surplus value" from their staff.

When you find the pace of your working day is ever more hectic, there may be a reason for that!

If you feel reluctant to go into work, it could just be a Monday morning feeling or there could be shades of what Marx termed "alienation" - what you make or the service you provide is in some critical sense out of your control and so the work you do is not really part of you.

"Bad" Marx

Marx was certainly an economic prophet, but many of his predictions proved wrong. Over the last 150 years, capitalism has been continuously modified.

There are still tremendous contrasts between what happens in different countries. The Swedish economy is very different from the German one, which contrasts to the American and Japanese etc.

Crucially, capitalism is still with us and when measured in material terms, the living standards of most people are much higher than they were when Marx wrote.

The economic historian, Angus Maddison, estimated that income per head in the UK economy rose nine-fold comparing 1998 with 1820 and in the Southern Irish economy, the increase was 20-fold.

Marxists after Marx have tried to explain why the inevitable collapse of capitalism has not yet happened. According to them, capitalism was propped up by the nineteenth century European empires or even by the Cold War. So the old Soviet Union actually did western capitalism a favour by forcing the latter to spend so much money on armaments.

That spending had the unintended consequence of keeping the show on the road for a few more decades. I don't find these theories convincing.

Although Marx himself recognised the growing importance of technology, he failed to question how far it was technology itself as opposed to the profit motive which dehumanised working conditions. Perhaps it is the modern assembly production line and the highly-pressurised office space which is the key issue and not whether the business happens to be under private or state ownership.

It was Marx's predecessor, Adam Smith, who had pointed out that modern production techniques which divided the process into finely defined tasks could be highly efficient, but could also demoralise the worker.

Like many of us, Marx was far better at saying what he was against rather than saying what he was for.

He wrote little about what the communist system which would replace capitalism would actually look like. He rather naively assumed that human nature was fundamentally co-operative and so a society based on "from each according to his abilities and to each according to his needs" could actually work.

Unrealistic assumptions stored up problems for the future.

Also, there was his own track record in terms of the extreme hatred and intolerance: "When our time comes, we shall not make excuses for our terror."

Marx cannot be held wholly responsible for everything that Lenin, Stalin, Mao and Pol Pot did, but there is some connection.

  • In next week's Economy Watch, we hear from Paul MacFlynn of the Nevin Economic Research Institute (Neri)

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