Give Marx a Chance to Save the World Economy

expat_panama

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Policy makers struggling to understand the barrage of financial panics, protests and other ills afflicting the world would do well to study the works of a long-dead economist: Karl Marx. The sooner they recognize we’re facing a once-in-a-lifetime crisis of capitalism, the better equipped they will be to manage a way out of it.

The spirit of Marx, who is buried in a cemetery close to where I live in north London, has risen from the grave amid the financial crisis and subsequent economic slump. The wily philosopher’s analysis of capitalism had a lot of flaws, but today’s global economy bears some uncanny resemblances to the conditions he foresaw.

Consider, for example, Marx’s prediction of how the inherent conflict between capital and labor would manifest itself. As he wrote in “Das Kapital,” companies’ pursuit of profits and productivity would naturally lead them to need fewer and fewer workers, creating an “industrial reserve army” of the poor and unemployed: “Accumulation of wealth at one pole is, therefore, at the same time accumulation of misery.”

The process he describes is visible throughout the developed world, particularly in the U.S. Companies’ efforts to cut costs and avoid hiring have boosted U.S. corporate profits as a share of total economic output to the highest level in more than six decades, while the unemployment rate stands at 9.1 percent and real wages are stagnant.

U.S. income inequality, meanwhile, is by some measures close to its highest level since the 1920s. Before 2008, the income disparity was obscured by factors such as easy credit, which allowed poor households to enjoy a more affluent lifestyle. Now the problem is coming home to roost.
Over-Production Paradox

Marx also pointed out the paradox of over-production and under-consumption: The more people are relegated to poverty, the less they will be able to consume all the goods and services companies produce. When one company cuts costs to boost earnings, it’s smart, but when they all do, they undermine the income formation and effective demand on which they rely for revenues and profits.

This problem, too, is evident in today’s developed world. We have a substantial capacity to produce, but in the middle- and lower-income cohorts, we find widespread financial insecurity and low consumption rates. The result is visible in the U.S., where new housing construction and automobile sales remain about 75% and 30% below their 2006 peaks, respectively.

As Marx put it in Kapital: “The ultimate reason for all real crises always remains the poverty and restricted consumption of the masses.”

Excerpt; more at Give Marx a Chance to Save the World Economy: George Magnus - Bloomberg.

Most of us have known for years that Obama and his useful Democrats are Marxists with their rich vs. poor and zero-sum idiocy. When I first saw this article I kept thinking the writer was joking. Like, nobody admits he's a Marxist.

This guy admits it.
 

Sallow

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Funny this shit rears its head when even communist countries are adopting free market and capitalistic economies.

:lol:
 

Sunni Man

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The fall of the Berlin wall and the dismantling of the USSR unequivocably proved that Marxism was a failed philosophy with zero merit. :doubt:
 

Sallow

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The fall of the Berlin wall and the dismantling of the USSR unequivocably proved that Marxism was a failed philosophy with zero merit. :doubt:
And yet conservatives continue to bray on like sheep about it.

Marxism is as dead as human sacrifice.
 

editec

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Looking to find solutions to TODAYS ECONOMIES in the musings of MARX in Das Kapital make as little sense as looking for solutions to todays economics in Adam Smith's Wealth of Nations.

There is no single one-size-fits-all solutions to how to run an effective and vibrant economy.

History is at best a GUIDE, not an operating manual.

Per usual I will point out that CARS have brakes and accelerators, and their steeling wheel goes both left and right for some damned good reasons.
 
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expat_panama

expat_panama

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Looking to find solutions to TODAYS ECONOMIES in the musings of MARX in Das Kapital make as little sense as looking for solutions to todays economics in Adam Smith's Wealth of Nations....
--or perhaps looking at both does make sense.

The important thing here is understanding what things are and how they work. Many people on these threads believe that if some get rich others must become poor. They also believe the gov't must 'spread the wealth around'. We need to face the fact that these ideas are basic to Marxism and while they're shameful we must not be ashamed of and try to deny what our beliefs are.
 

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