Marx On Globalisation

Posted on March 27, 2008


For the past two decades “globalisation” has become the buzzword. In recent history hardly any other process has dominated the spectrum of social science as globalisation. From political scientists to economists, from right wingers to the ultra leftist, from academics to corporate managers everyone has been analysing and trying to understand this phenomenon unfolding before us all. Like the Russian roulette the unfolding globalisation has in itself all the tragicomic events causing a global Domino ripple hitherto unheard and unseen.

In this entire drama what is intriguing is the fact the as more and more world enters into the so-called “global age”, the analysis and ‘prophesies’ of Marx increasingly seems to be coming true.

At the dissolution of Soviet Union and the fall of the Berlin Wall, Francis Fukuyama proclaimed the “end of ideology” and capitalism’s indisputable victory and consigning Marxism to dust bin of history. Hardly did he imagine that less than a decade and half the very same bourgeoisies economist and intelligentsia would be forced to read and re-read the works of a person, termed the ‘Satan’ more than 150 years after his death. A person whom they have refuted ad infinitum and terming his views as anachronistic.

It must have been quite difficult for the international speculator George Soros – the revered new age financial guru –by the mainstream media and the bourgeoisie world over to write:

Global Capitalism “is coming apart at the seams”

John Micklethwait and Adrian Wooldridge of the fiercely pro market The Economist in their book A Future Perfect: The Challenges and hidden Promise of Globalisation:

“As a prophet of socialism Marx may be kaput; but as a prophet of the ‘Universal interdependence of nation’ as he called globalisation, he can still seem startling relevant ….his description of globalisation remains as sharp today as it was 150 years ago”

So it becomes pertinent to understand how Marx investigated and analysed the process of ‘globalisation’. Though he never used the term ‘globalisation’ per say of capital yet the underlying meaning is clearly discernable in the Marxian term ‘world market’ and ‘foreign trade’. Both of them, being liberally used in the extant text of Marx (and of course also Engels). For Marx ‘capitalism’ represented a specific mode of production characterised by the separation of producer (i.e. the workers) from the means of production, based on wage, labour and capital.
….labour is the workers own life activity, the manifestation of his own life. And this life activity he sells to another person in order to secure the necessary means of subsistence.
(Karl Marx, Wage Labour and Capital, Pg 153, Selected Works Vol. 1, Progress Publisher, Moscow 1977, USSR)

The commodification of labour, says Marx is specific characteristic of Capitalism:
“Labour power was not always commodity.”

The Capitalist Mode of Production (C.M.P)

“….replaces and put an end to all feudal, patriarchal, idyllic relations”  (Karl Marx and Fredric Engels; Communist Manifesto (CM), SW 1, Pg 111).

Unlike earlier mode of production, the Capitalist Mode of Production takes the form of commodity. Labour subsumes under capital, and every occupation become a “paid wage labour” (Marx and Engels, Communist Manifesto, Pg 111) to the bourgeoisie.

Here it is important to understand how the Capitalist Mode of Production differs from all the other historic modes of production that it succeeded.

Where as in all the pre-Capitalist Mode of Production, the society was driven by need, CMP replaced it with exchange. To elaborate, a product in the pre Capitalist society was in demand for its value of utilization (or need) by the consumers, it is diametrically different case in the capitalist society.

In CMP products take form of commodity.

A commodity is an exchangeable product used to satisfy human need. Every commodity has an associated value associated to it. This value can further be sub categorized into use-value and Exchange value (or simply value). The utility the thing makes constitutes its use-value. Wher as the exchange value (or simply value) is proportion in which a certain number of use-values of one kind can be exchanged for certain number use values of other kinds. A common feature of all commodities is that they are “product of labour”. Each particular commodity represents only a certain share of “socially necessary ‘labour time’. The magnitude of value is determined by the amount of socially necessary labour for the production of a given commodity.

“Whenever by an exchange, we equate as value our different products by that very act, we also equate as human labour, the different kind of labour expended upon them. We are not aware of this nevertheless we do it.”

(Marx, Capital, Vol. 1, Ch. 1, Section 4, Progress Publishers, Moscow, USSR)
Further for a commodity the exchange value constitutes the quantitative value and the use value represents the quantitative aspect of value. In determining the price of a commodity the use value constitutes the substratum of the price of a commodity.

The value of a commodity consists in the fact that its owner relinquishes its own use value and pockets its exchange value.
(Engels, Housing Question III, SW Vol.2)

The pre capitalist social formation were characterised by use-value in CMP it is the exchange value which dominates, hence the Surplus Value (SV), that though present in all class divided society assumes a much greater significance. Whereas the surplus value can originate outside the sphere of production in pre Capitalist Mode of Production, where it represents essentially a transfer value (so-called primitive accumulation of capital) and is circumscribed by the approximate fixed cycle if needs. But under CMP where capital controls and dominates the sphere of production, it assumes significance, as it represents a constant increase in value.

The Capitalist Mode of Production thus is characterised by lust of production, that drives it into a maddening rage, termed by Marx as ‘enrichment mania’

“The enrichment mania itself is impossible without money, the common form in which all commodities are transformed as exchange values. All other accumulation and passion for accumulation appear as naturally given, limited, on the one hand by needs, and, on the other hand, conditioned by the limited nature if the product.” (Marx, contribution to the Critique of political Economy)

Thus it is only under CMP that exchange value replaces the need value.

“….it is the exchange value and not use value which is the determining end-in-itself of the movement”. (Marx, Capital Vol.1, Progress Publishers, Moscow, USSR)

Further Marx writes “The bourgeoisie cannot exist without constantly revolutionizing the instrument of production and thereby the relation of production and with them the whole relation of society”. (KM, CM, Pg 111)

While investigating the process of production, Marx analysed in detail he Theory of Surplus Value — which he described as his most important contribution to the progress of economic analysis. (Marx, Letter to Engels, 24 August 1867)

The production of surplus value was widely used by Marx during his course of analysis of Capitalist Mode of Production one finds its repeated use in Marx’s extant text. The limitation of space prohibits us from going in detail of discussing about surplus Value which in itself constitutes separate topic of discussion.

As if commenting on the current trend of imperialism and the multinationals to homoginise the word order, Marx wrote:

“….the bourgeoisie has through it exploitation if the world market given a cosmopolitan character to production and consumption character to production and consumption in every country. To the great chagrin of reactionists, it has drawn from under the feet of industry the national ground on which it stood. All old established national industries have been destroyed or are daily being destroyed. They are dislodged by new industries whose introduction became a life and death question for all civilized nations, by industries that no longer work up indigenous raw material, but raw material drawn from the remotest zone; industries whose products are consumed not only at home but in every quarter of the globe. In place of the old wants, satisfied by the production of the country, we find new wants, requiring for their satisfaction the products of distant lands and climes….

The bourgeoisie, by the rapid improvement of all instruments of production, by the immensely facilitated means of communication, draws all, even the most barbarian nations into civilization.” (Marx and Engels, CM, Pg.112)

“Capital” writes Marx, “also is a social relation of production. It is a bourgeoisie production relation, a production relation of bourgeoisie society.” He further writes “Capital consists not only of means of subsistence, instruments of labour and raw material or only of material products; it consists just as much exchange values, all the products of which it consists are commodities. Capital is therefore, not only a sum of material product; it is a sum of commodities, of exchange values, of social magnitude.”
(Marx, Wage, Labour and Capital, SW Vol. 1, Pg 160)

In CMP there exists “the epidemic of over production..” capitalist production in no way produces at an arbitrary level. On the contrary the mot it develops the more it is compelled to produce on a scale which has nothing to do with immediate demands, but which depends on the continuous enlargement of the world market. (The bourgeois i.e. capital cannot stop this spiral growth of “production for production’s sake as an end in itself” (Marx, ibid)

The modern bourgeoisie society, says Marx, with its relations of production of exchange a n of production and of exchange, is like sorcerer, who is no longer able to control the power of the nether world whom he has called up by his spell (KM, CM, 113)

The bourgeoisie society has to sustain this growth not only sustain they have to augment it for their own survival. “the essential condition for the existence and for the sway of the bourgeoisie class, is the formation and augmentation of capital…” (KM, CM 119)

Let us recall that the hallmark of a Capitalist Mode of Production is the appropriation of Surplus Value. In all other previous modes of production, it was the use value and not exchange value which governed the production, but in CMP the use value is replaced by exchange value, hence unlike the pre Capitalist Mode of Production, the Surplus Value hence generated cannot be circumscribed.

On the contrary the CMP the value of surplus Value assumes far greater importance and becomes the dominant theme. The capital can only generate more Surplus Value if it keeps itself in the circuitous motion. Marx’s brilliant and much famed formula (M-C….P….C’ -M’) elucidates this motion. This circuitous motion can only sustain itself if the external trade develops and reaches to the ‘world market’. The external trade transforms the ‘market’ into ‘new market’. this develops the true nature of value of the surplus product. This world market changes the character of money that money now develops into world money while the abstract labour metamorphosis into social labour.

The edifice of CMP rests on the development of labour as social labour. The entire transformation can only happen on the basis of external trade and the enlargement of the world
As capital tends to create surplus value continuously, it creates complimentary poles of exchange, thus propagate CMP across the globe.

The world market is therefore the pre-supposition as well as result of the capitalist production.
(Marx, Theorien Uber den Mehrwert, vol 3 (1861-1863), Berlin)

Each limit from point of capital is an obstruction that has to be surmounted, even at the cost of the destruction of productive force.
“Capital tends to submit each moment of production itself to exchange, to substitute its own mode of production for modes of production (appearing earlier) which it finds too much rooted in nature. (Marx, Grundrisse der kritik der political economy)

Thus capital tends to root out all other modes of production, that it comes to view as obstructionist in its incessant growth, hence it goes on a spree of destruction of all vestiges of the earlier society.

They (feudal mode of production) had to be burst as under, they were burst asunder
(Communist Manifesto, SW1)

Then capital goes on to homoginise the world in its own image. “it compels all nations, on pain of extinction, to adopt the bourgeoisie mode of production; it compels them to introduce what it calls civilization into their midst i.e. to become bourgeois itself. In one word it creates a world after its own image (KM, CM, 112)

All determination is negative, and all negation is determination wrote Karl Marx in the first manuscript of Capital

Capital in its own course of temporal spatial development, strewn with plunder, enslavement, dispersion of masses perpetrated at a scale unknown to human beings sows its own seed of negation.

The class it creates for its own development exacerbates its own nemesis. The proletariats stands directly confronting it and halting its death march to crate a new society. One hand the bourgeois society carries within its own womb seed of its own destruction; on the pother it creates the material foundation of a new society.

The CMP is credited for the development of productive forces, which it has carried forward more than any previous mode of production.

“Only such a movement on a world scale makes possible the replacement of local individuals whose horizon is world –historic (Marx, German Ideology)

Marx Economist or Revolutionary

With all analysis of Marxism a central point that one should never forget is that Marx above all was an internationalist and a revolutionary. The academia and generally the resurgent Marxist academia of the first world while discussing the Marxian theory of capitalism; overemphasizes on the “economist” Marx, while forgetting the real Marx—the internationalist revolutionary Marx.
Amidst their economic jargon and mathematical equations, somewhere the soul of Marx is completely neglected. The works of Marx and Engels above all their analysis and interpretation carries within itself the ultimate goal for which they were penned. The class anger, the historical program of awakening the working class from their slumber is today what is missing from the scores of papers produced every year from the numerous universities and research institutions. Economic Marxism cannot be isolated from its overall superset of political economy. Marxism is not another subset of Economics enumerating statistics and devoid of any human emotions. It is a methodology of analysing the ills that is plaguing the present society and how to end this impasse.

Marx profoundly wrote about the ‘interdependence of the nations’ as well as the ‘positive side of capital’ his admiration of CMP as a superior economic system can be seen from the following lines where though against the devastating effects of British imperialism in India, he appreciates the bourgeois as it [will] …

“….create the material basis of the new world—on the one hand the universal intercourse founded upon the mutual dependency of mankind, and the means of that intercourse…”
(Marx, Future Results of British Rule in India, SW 1 199)

He expressed his optimism that colonial power whatever may have the crimes of England (in case of India) she was the unconscious tool of history in bringing about that revolution. Thus for Marx the process of interdependence of nation would bring about not only benefits for the bourgeois but would hasten the social transformation of the pre Capitalist Mode of Production societies.
In 1847, addressing the workers, Marx termed big industries, the free trade and world market as the ‘positive side of capital’. Without capitalism there would have been no proletariat, neither could the material means for the worker’s emancipation and the foundation of a new society could be laid. He believed capitalism as an historically inevitable, a step along the path of humanities destiny.

Based on this theses Marx declared his unequivocal support for Free Trade. While giving lecture on the ‘Corn Law’ he proclaimed his full support for free trade:

Why Marx Justified Free Trade

Justifying his ‘vote for free trade’ Marx explained “The system of free trade is destructive. It dissolves the old nationality and drives towards extreme antagonism between the bourgeoisie and the proletariat. In a word the system of free trade hastens social revolution.”

On the whole the CMP to meet its pre destines fate, it has to become unbearable not only for the few but to the whole class of working people. Producing a masses of individuals deprived of means of living on one hand and at the other immense wealth confronting the deprived concentrated in hands of few; dominating their every aspect of life as an alien power. The world market then becomes the playground where this process finds its most brutal expression and the logical conclusion.

Contradiction is pre requisite for progress. The only way a mode of production paves way for the other more superior mode of production is by the historical development of their inherent contradiction. The capitalist system continuously seeks to overcome its inherent antagonism. But its crisis keeps recurring, and assumes the form of cycle.

In the opening chapter of ‘Capital’ Marx termed the inherent cyclical crisis as the character of Capitalism:

If the interval in time between the two complementary phase of the complete metamorphosis of a commodity become too great, if the split between the sale and purchase becomes too pronounced, the intimate connection between them, their oneness, asserts itself by producing — a crisis. The anti theses, use value and value (i.e. exchange value — P.); the contradictions that private labour is bound to manifest itself as direct social labour , that a particularised concrete kind of labour has to pass for abstract human labour; the contradiction between the personification of objects and the representation of persons by things; all these antitheses and contradictions, which are immanent in commodities, assert themselves, and develop their modes of motion; in metamorphosis of a commodity, these modes therefore imply the possibility, and no more than the possibility of crises. The conversion of this mere possibility and no more than the possibility crises. The conversion of this mere possibility into reality is the result of a long series of relations…..(Marx, Capital vol.-I)

In the Communist Manifesto Marx pellucidly explains the capitalist’s futile attempt to overcome the periodic crises.

“And how does the bourgeois get over these crises? On the one hand by enforced destruction of a mass of productive forces; on the other by conquest of new market, and by the more through exploitation of the old ones. That is to say, by paving the way for more extensive and more destructive crises and by diminishing the means whereby crises are prevented”.

“Capitalist production begets with the necessity of a natural process, its own negation. What is glaring in this periodic crises is the revolt of the bourgeoisie’s ‘grave diggers’ against their own ‘producers.’

Rising like phoenix arises the workers now not alone but as a class forming a movement that unlike all previous movement is “the self conscious movement independent movement of the immense majority.” Smashing along its triumphal march the present and all vestiges of past modes of production that hitherto were based on one class exploiting other; the proletariats march towards forming “Union of Free Individuals”, heralding the exploitation less “Associated Mode of Production.” Superior than all the other system and thus entering ushering an era of proletarian internationalism, the globalised society of the masses.

“History is Judge, its executioner—the proletariats”

Notes and Reference:

The works cited, apart from Capital, of Karl Marx, has been referenced from “Karl Marx and Frederick Engels Selected Works (in three volumes), Progress Publishers, Moscow”. The volume and page numbers cited are as they appeared in the Fourth printing 1977 of the selected works.

 This article was written in 2008 and published in Counter Currents