Marx's Economics and the Transition from Capitalism to Communism

This chapter offers an overview and interpretation of Marx’s economics and his account of why capitalism should eventually yield to socialism. Topics covered include: the background of Marx’s labor theory of value in Smith and especially Ricardo; the failure of the labor theory of value as an account of production prices; the irrelevance of the labor theory of value to Marx’s most important claims about capitalism (e.g., the pursuit of more money [profit] as the raison d’etre of all capitalists [agreeing with Milton Friedman, among others]; the unparalleled power of capitalism to produce technological development; the constant displacement of human labor by technology, etc.); “exploitation” as a technical, rather than moral notion; the “fetishism” of commodities; the failure of the “falling rate of profit” account of the demise of the capitalism; the plausibility of the mass immiseration and underconsumption model of capitalist crises; the preconditions of revolution (massive productive power, mass immiseration), which have never obtained and still do not obtain; the role of self-interest in revolution and the irrelevance of moral philosophy or appeals to altruism; and Marx’s conception of “freedom” as work freed from the necessity of laboring in order to survive (“wage slavery”). We argue that socialism (i.e., the use of massive productive power to meet human needs and free people from “wage slavery”) is not, contrary to Marx’s teleological rhetoric, inevitable, and that the choice between “socialism or barbarism” (as Luxemburg framed it) could go either way