Tuesday, March 26, 2013

Michael Schuman: Marx’s Revenge -- How Class Struggle Is Shaping the World

Marx’s Revenge: How Class Struggle Is Shaping the World
By Michael Schuman

Karl Marx was supposed to be dead and buried. With the collapse of the Soviet Union and China’s Great Leap Forward into capitalism, communism faded into the quaint backdrop of James Bond movies or the deviant mantra of Kim Jong Un. The class conflict that Marx believed determined the course of history seemed to melt away in a prosperous era of free trade and free enterprise. The far-reaching power of globalization, linking the most remote corners of the planet in lucrative bonds of finance, outsourcing and “borderless” manufacturing, offered everybody from Silicon Valley tech gurus to Chinese farm girls ample opportunities to get rich. Asia in the latter decades of the 20th century witnessed perhaps the most remarkable record of poverty alleviation in human history — all thanks to the very capitalist tools of trade, entrepreneurship and foreign investment. Capitalism appeared to be fulfilling its promise — to uplift everyone to new heights of wealth and welfare.

Or so we thought. With the global economy in a protracted crisis, and workers around the world burdened by joblessness, debt and stagnant incomes, Marx’s biting critique of capitalism — that the system is inherently unjust and self-destructive — cannot be so easily dismissed. Marx theorized that the capitalist system would inevitably impoverish the masses as the world’s wealth became concentrated in the hands of a greedy few, causing economic crises and heightened conflict between the rich and working classes. “Accumulation of wealth at one pole is at the same time accumulation of misery, agony of toil, slavery, ignorance, brutality, mental degradation, at the opposite pole,” Marx wrote.

A growing dossier of evidence suggests that he may have been right. It is sadly all too easy to find statistics that show the rich are getting richer while the middle class and poor are not. A September study from the Economic Policy Institute (EPI) in Washington noted that the median annual earnings of a full-time, male worker in the U.S. in 2011, at $48,202, were smaller than in 1973. Between 1983 and 2010, 74% of the gains in wealth in the U.S. went to the richest 5%, while the bottom 60% suffered a decline, the EPI calculated. No wonder some have given the 19th century German philosopher a second look. In China, the Marxist country that turned its back on Marx, Yu Rongjun was inspired by world events to pen a musical based on Marx’s classic Das Kapital. “You can find reality matches what is described in the book,” says the playwright.

That’s not to say Marx was entirely correct. His “dictatorship of the proletariat” didn’t quite work out as planned. But the consequence of this widening inequality is just what Marx had predicted: class struggle is back. Workers of the world are growing angrier and demanding their fair share of the global economy. From the floor of the U.S. Congress to the streets of Athens to the assembly lines of southern China, political and economic events are being shaped by escalating tensions between capital and labor to a degree unseen since the communist revolutions of the 20th century. How this struggle plays out will influence the direction of global economic policy, the future of the welfare state, political stability in China, and who governs from Washington to Rome. What would Marx say today? “Some variation of: ‘I told you so,’” says Richard Wolff, a Marxist economist at the New School in New York. “The income gap is producing a level of tension that I have not seen in my lifetime.”

Tensions between economic classes in the U.S. are clearly on the rise. Society has been perceived as split between the “99%” (the regular folk, struggling to get by) and the “1%” (the connected and privileged superrich getting richer every day). In a Pew Research Center poll released last year, two-thirds of the respondents believed the U.S. suffered from “strong” or “very strong” conflict between rich and poor, a significant 19-percentage-point increase from 2009, ranking it as the No. 1 division in society.

The heightened conflict has dominated American politics. The partisan battle over how to fix the nation’s budget deficit has been, to a great degree, a class struggle. Whenever President Barack Obama talks of raising taxes on the wealthiest Americans to close the budget gap, conservatives scream he is launching a “class war” against the affluent. Yet the Republicans are engaged in some class struggle of their own. The GOP’s plan for fiscal health effectively hoists the burden of adjustment onto the middle and poorer economic classes through cuts to social services. Obama based a big part of his re-election campaign on characterizing the Republicans as insensitive to the working classes. GOP nominee Mitt Romney, the President charged, had only a “one-point plan” for the U.S. economy — “to make sure that folks at the top play by a different set of rules.”

Amid the rhetoric, though, there are signs that this new American classism has shifted the debate over the nation’s economic policy. Trickle-down economics, which insists that the success of the 1% will benefit the 99%, has come under heavy scrutiny. David Madland, a director at the Center for American Progress, a Washington-based think tank, believes that the 2012 presidential campaign has brought about a renewed focus on rebuilding the middle class, and a search for a different economic agenda to achieve that goal. “The whole way of thinking about the economy is being turned on its head,” he says. “I sense a fundamental shift taking place.”

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