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First Wave: Classical Marxism

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In the first wave of marketisation, during the nineteenth century, the focus is on the commodification of labour – first the separation of labour from means of subsistence so that it can be bought and sold in a labour market, and then strategies by capital to reduce the cost of labour power through deskilling, employing multiple members of the family and creating a reserve army of labour. This led to struggles that emanated from production, from factories – struggles for labour rights such as limitation of the length of the working day, protection against unemployment, the right to organise into trade unions, the extension of the vote, the development of cooperatives and the development of political parties. The countermovement is of a local character, building toward national working-class organisation to secure state enforcement of labour rights.

To this corresponds the classical Marxism of Marx and Engels and of the golden years of German social democracy, the Marxism of Kautsky, Luxemburg and Eduard Bernstein. It is based on the idea that capitalism is a system of exploitation that is inevitably doomed because the relations of production will finally and definitively fetter the forces of production. Competition among capitalists leads to the accumulation of wealth at one pole of society and its immiseration at the other pole, which in turn gives rise to, on the one side, the deepening crises of overproduction and the recurrent destruction of the means of production and on the other side, the simultaneous intensification of class struggle. What classical Marxism shares is the view that capitalism is doomed by its own laws to destroy itself, thereby giving way to socialism.

The debate between Luxemburg (1970) and Kautsky (1971) (see also Goode 1983) is about precisely when the final crisis will occur, when the forces of production will finally be fettered or whether, as in the view of Bernstein (1961), there is no final crisis because capitalism will evolve into socialism. Despite differing views, they all shared the belief that the rise of socialism was guaranteed because capitalism was doomed. As a result socialism remained largely unexamined. It was presumed to develop on the basis of the self-destruction of the capitalist mode of production through the concentration of capital and the collectivisation of labour. In this view socialism is an economic utopia and the negation of capitalism. Classical Marxism depended on laws of history – the succession of modes of production, the dynamics of capitalism that sows the seeds of its own destruction and history as the history of class struggle – that will inevitably lead capitalism toward socialism.

Classical Marxism suffered from three fatal flaws. First, its theory of class struggle was wrong – class struggle does not necessarily lead to its intensification but rather, through the concessions it wins, the working class becomes organised within the framework of capitalism. Second, its theory of the state was undeveloped – the state is organised to defend capitalism against capitalists as well as workers. The state recognises and enforces the material interests of workers, in a limited but crucial way, through trade unions and parties, but it also regulates relations among capitalists so that competition does not destroy capitalism. Third, and finally, its theory of socialist transition hardly existed – except in the case of Bernstein who saw it as an evolutionary process based on the inevitable expansion of electoral democracy – thereby confusing the end of competitive capitalism with the end of all capitalism, missing the way the state could contain the ravages of the market and the deepening of class struggle by creating an organised capitalism. Classical Marxists saw the signs of organised capitalism but they mistook it for socialism. In fact, organised capitalism laid the foundations for the second wave of Marxism.

Marxisms in the 21st Century

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