Karl Marx (1818-1883) was a philosopher, author, social theorist, and economist. He is famous for his theories about capitalism, socialism, and communism. Marx, in conjunction with Friedrich Engels, published The Communist Manifesto in 1848; later in life, he wrote Das Kapital (the first volume was published in Berlin in 1867; the second and third volumes were published posthumously in 1885 and 1894, respectively), which discussed the labor theory of value.
Early Life and Education
Born in Trier, Prussia (now Germany), on May 5, 1818, Marx was the son of a successful Jewish lawyer who converted to Lutheranism before Marx's birth. Marx studied law in Bonn and Berlin, where he was introduced to the philosophy of G.W.F. Hegel. He became involved in radicalism at a young age through the Young Hegelians, a group of students who criticized the political and religious establishments of the day. Marx received his doctorate from the University of Jena in 1841. His radical beliefs prevented him from securing a teaching position, so instead, he took a job as a journalist and later became the editor of Rheinische Zeitung, a liberal newspaper in Cologne. After living in Prussia, Marx lived in France for some time, and that is where he met his lifelong friend Friedrich Engels. He was expelled from France and then lived briefly in Belgium before moving to London, where he spent the rest of his life with his wife. Marx died of bronchitis and pleurisy in London on March 14, 1883, and was buried at Highgate Cemetery in London. His original grave was nondescript, but in 1954, the Communist Party of Great Britain unveiled a large tombstone, including a bust of Marx and the inscription "Workers of all Lands Unite," an Anglicized interpretation of the famous phrase in The Communist Manifesto: "Proletarians of all countries, unite!"
Marx's Theories Marx was inspired by classical political economists such as Adam Smith and David Ricardo, while his own branch of economics, Marxian economics, is not favored among modern mainstream thought. Nevertheless, Marx's ideas have greatly impacted societies, most prominently in communist projects such as those in the USSR, China, and Cuba. Among modern thinkers, Marx is still very influential in the fields of sociology, political economy, and strands of heterodox economics.
Two major flaws in capitalism
In general, Marx claimed there are two major flaws inherent in capitalism that lead to the exploitation of workers by employers: - The chaotic nature of free market competition and - The extraction of surplus labor. Ultimately, Marx predicted that capitalism would eventually destroy itself as more people become relegated to working-class status, inequality rose, and competition would lead the rate of corporate profits to zero. This would lead, he surmised, to a revolution where production would be turned over to the working class as a whole.
Exploitation and Surplus Value
While many equate Karl Marx with socialism, his work on understanding capitalism as a social and economic system remains a valid critique in the modern era. In Das Kapital (Capital in English), Marx argues that society is composed of two main classes: Capitalists are the business owners who organize the process of production and who own the means of production such as factories, tools, and raw materials, and who are also entitled to any and all profits. The other, much larger class is composed of labor (which Marx termed the "proletariat"). Laborers do not own or have any claim to the means of production, the finished products they work on, or any of the profits generated from sales of those products. Instead, labor works only in return for a monetary wage. Marx argued that because of this uneven arrangement, capitalists exploit workers. This exploitation is the reason, according to Marx, that employers can generate profits: they extract a full day's worth of effort and production from workers but only pay them a smaller fraction of this value as wages. Marx termed this surplus value and argued that it was nefarious.
Labor Theory of Value
Like the other classical economists, Karl Marx believed in a labor theory of value (LTV) to explain relative differences in market prices. This theory stated that the value of a produced economic good can be measured objectively by the average number of labor hours required to produce it. In other words, if a table takes twice as long to make as a chair, then the table should be considered twice as valuable. Marx understood the labor theory better than his predecessors (even Adam Smith) and contemporaries and presented a devastating intellectual challenge to laissez-faire economists in Das Kapital: If goods and services tend to be sold at their true objective labor values as measured in labor hours, how do any capitalists enjoy profits? It must mean, Marx concluded, that capitalists were underpaying or overworking, thereby exploiting laborers to drive down the cost of production. While Marx's answer was eventually proved incorrect, and later economists adopted the subjective theory of value, his simple assertion was enough to show the weakness of the labor theory's logic and assumptions; Marx unintentionally helped fuel a revolution in economic thinking. Historical Materialism Another important theory developed by Marx is known as historical materialism. This theory posits that society at any given point in time is ordered by the type of technology used in production. Under industrial capitalism, society is so ordered, with capitalists organizing labor in factories or offices where they work for wages. Prior to capitalism, Marx suggested that feudalism existed as a specific set of social relations between lord and peasant classes related to the hand-powered or animal-powered means of production prevalent at the time.
What Is Marxism vs. Communism?
Marxism is a system of socioeconomic analysis, while communism is a form of economic production that extends to government or political movements. Marxism is a broad philosophy developed by Karl Marx in the second half of the 19th century that unifies social, political, and economic theory. It is mainly concerned with the battle between the working class and the ownership class and favors communism and socialism over capitalism.
