If Marxism is So Subversive, Why Does the Ruling Class Allow It?

 Justin Aukema

7 December 2022

Figure: Former EU President Jean-Claude Juncker and others applaud the unveiling of a Marx statue in his home town of Trier in 2018. Image kindly shared under CC license. 

Introduction

This essay focuses on a simple question: “is Marxism threatening to the ruling class?” Now, many people and probably most Marxists will answer that “yes” of course it is. After all, without the analytical tools of Marxism we wouldn’t even be clear about who the ruling class is in the first place, or how and why they rule. Similarly, it is self-evident that Marxism represents the best and most thorough critique of capitalism, and that even any basic understanding of capitalist economy must start with Marx.

But consider the question from the opposite perspective. Marx’s work has been around for 150 years. The ruling class has had more than ample time to familiarize itself with its basic arguments. And, let’s be honest, no one understands capitalism better than capitalists themselves. This is no mere fluke. It’s built into the capitalist system. Just like the means of production and capital, knowledge is concentrated at the top, in the hands of the capitalist class. Academics do the ruling class an injustice to think that only they know how capitalism, or other social relations for that matter, work.

On top of that, Marx’s work is immensely popular with much of the working and middle class. The Communist Manifesto is the fourth-best-selling book of all time. Now, bourgeois professionals nevertheless like to assure themselves that their academic training gives them special insight into Marx’s work, work which is clearly indecipherable for average plebes. Based on this assumption, every year numerous books are published attempting “new” or “easy” explanations of Marx’s writings. Ironically many of these secondary studies are usually only read in academic circles anyway. But even assuming that the working class, especially the vanguard of the working class (i.e. the most exploited workers in the most essential industries), had the time (they don’t) and the faculties (they do) to understand Marx, simple historical materialism tells us that this wouldn’t really matter anyway. Their proximity to the means of production inherently positions them to best understand the mechanisms of exploitation.

So, if Marx is so wildly popular and widely read, then why isn’t everyone rioting in the streets? And if it’s so subversive, then why does the ruling class allow it? Now, at this point a slight digression is already in order. As one may point out, Marxism is not allowed in certain areas still today and/or it has been banned in the past. Thus how can I say that it is allowed? Doesn’t this prove Marxism’s subversive credentials, the reader may protest. Alas, I do not have a definitive answer to this. But I do have a tentative hypothesis. Marxism is essentially a theory of the material relations of production. It privileges workers engaged in productive labor of commodities. Now, in societies with a low organic composition of capital, high rates of surplus value and profit, and high value added Marx’s work may be seen as more subversive by authorities. This is because again it highlights the power of productive workers. But in advanced capitalist societies, or in societies with low value added via a global division of labor or political hegemony (or both), more workers will be engaged in unproductive labor and thus their opposition is already inherently less threatening to the global capitalist class. Is it not for this reason that we freely read Marx today?

The true popularity of Marx

My argument is this: the ruling class no longer finds Marxism threatening because the central theses of Marx’s thought have already been implicitly accepted among not only the ruling class but general society at large. And as for the ruling class, many of them cynically exploit Marx’s work and findings to their advantage. Once something becomes obvious, once it becomes accepted knowledge, it may no longer act as a critique of its subject but rather paradoxically becomes its justification. Moreover, we must at least give the ruling class some credit. After all, if one understands notions such as the organic composition of capital, the falling rate of profit, and so on and so forth, then, from a capitalist perspective, why would one not employ them for their benefit? There is no rule in Marxism which says Marx’s critique can only be used by exploited workers.

So, again, the ruling class, perhaps not individual capitalists but the capitalist class in an aggregate sense, has already absorbed the key tenets of Marxism. Well then what are these key tenets? Many young Marxists today are still trying to figure these out. Of course, there are many additional observations by Marx that are still being uncovered or explored, or ongoing debates about some of his thought. But the fact remains that his key findings are basically agreed upon. Relating to capitalism, there are three main ones to highlight. Each of these corresponds exactly to the three volumes of Capital but also overlap with other works such as Theories of Surplus Value.

1. Only labor produces new value, or more value than its own worth (i.e. the amount initially paid for it). This surplus value is the only thing that augments the overall amount of total social capital and thus its extraction becomes the key aim and motivator of capitalism and capitalist growth (Capital Vol. I)
2. Surplus value is reinvested into successive production cycles leading to growth and expansion. Only “productive” labor leads to new value creation and only “productive” capital leads to capital expansion and accumulation. Financial or unproductive capital exist simultaneously (not parasitically) to productive capital. It acts as a promise on the creation of future productive value and thus can indirectly (but not by itself) lead to an increase in total social value (by promoting new/more production) (Capital Vol. II)
3. As capital accumulates it augments the organic composition of capital, meaning that the ratio of constant capital relative to variable capital grows. This leads to capitalist crises however because only labor power (variable capital) and not machines (constant capital) can create new value. A crisis of overproduction occurs when too many commodities are produced that are unable to be sold; the surplus value contained therein cannot be realized. (Capital Vol. III, Theories)

These are the three basic points. Whether or not one individually understands them all or how they fit together is irrelevant because on a larger social scale they have already been confirmed. Although the ruling class publicly denies the labor theory of value, they privately acknowledge it through affirmations of productive capital (e.g. GDP) and the recognition that financial capital or profits themselves cannot create new value. This last point is obvious through the periodic collapse of the stock market and credit bubbles etc.

Regarding point II, the ruling class and bourgeois economists already basically affirm the organic composition of capital through various control mechanisms. These are usually enacted by the State acting in cooperation with business. For example, so-called administrative guidance is used to ensure maximum profits. Governments help businesses predict future national and global demand by setting targets for capacity expansion (buying new machines or hiring more workers etc.). Businesses then expand or retract based on this. The government can also incentivize growth by promising to absorb some of the risks in the case of financial crises. This was seen all throughout the postwar high-growth period and continues to the present day in the form of tariffs, subsidies, and financial bailouts for protected or important industries.

This connects to point III since it is generally, albeit only privately, acknowledged that it is the tendency of the rate of profit to fall as the organic composition of capital grows. As capitalism becomes more developed, therefore, there is a need for the capitalist economy and ruling class to place limits and ceilings on how much development can be achieved. From a historical materialist perspective, this is obvious because it relates to the internal conflict between productive forces and productive relations. Think about all the studies released that talk about “saving” capitalism from its imminent destruction. They recognize the threat. But instead of just waiting for its inevitability like many academic Marxists, they instead take concrete policy actions to mitigate its demise.

I have written elsewhere that, of course, bourgeois policy making is like a game of whack-a-mole. Getting rid of one problem simply leads to the appearance of more new problems. But for the ruling class, even this is more acceptable than the alternative which is the collapse of the capitalist system itself. This is why they are willing to make compromises with labor in the first place as well as to sustain workers through State welfare programs. Marx’s observation of the key contradiction of capitalism, that capitalism harms the very basis for its wealth (workers’ labor power) must by default be begrudgingly acknowledged for the system to work in the first place.

For this reason I would argue that what is often cast as Marx’s most difficult concept to grasp, the falling rate of profit, is actually the easiest and most obvious, especially for the ruling class. They know better than most that decades of attacks on labor have reduced workers’ ability to buy goods (i.e. effective demand) thus making more and more of their production redundant. For them, therefore, degrowth is not a radical challenge but rather an urgent imperative that they are more than happy to embrace. This is because, as others have also explained, it is still possible to reap high rates of profit through increased exploitation for example even in the absence of overall economic growth. The capitalist class also understands that financial growth without a productive basis is not the same thing as real growth. But no one has yet found a way to reconcile the fact that reduced purchasing power necessitates increased consumer credit and so the problem of the growth of fictitious capital remains.

What about Marxist radicalism?

Now of course, you may object, but what about the inherent radicalism of Marxism? After all, isn’t it supposed to be a theory of the working class rising against the capitalist system itself? What better weapon, then, to use against our oppressors, right? Well, yes and no. There are two reasons. First, reading Marx alone doesn’t instantly defer political power ipso facto. This must still be achieved through actual organizing and struggle in the real world. However, the major problem here is, as I have written elsewhere, that all of us are increasingly encouraged to consume representations of action-power (i.e. what I have called elsewhere “the Revolution Industry”) rather than engage in actual action itself. All that we have is the signifier, mediated through multiple layers of digitized and highly structured, corporate controlled devices, while the signified itself fades further into abstraction. This is made worse by the fact that the power of labor has been successively on the decline for the past forty years as a result of the shift to more “flexible” modes of accumulation and the increasing difficulty-need to create new value described above.

Second, the object of Marx’s critique has shifted significantly over the many years since Capital was written. In fact, Marx, Engels, Lenin and many others who pioneered the critique of capitalism and historical materialism knew well that constant analysis of the ways in which capitalism undermines its own social foundation is necessary. In other words, as productive forces develop, they inevitably provoke shifts in the relations of production (for example as partly objectively realized through political power, laws, etc.). This equates to shifting class relations as well, including who is a member of which class, and which industries/workers are most exploited/value-producing etc. Thus, in short, constant class analysis is needed. It is not enough to simply take Marx’s critique of capitalism in the 19th century and apply it to the 21st, because capitalism itself has undergone so many changes since that time. And, moreover, the strategies that worked then may/may not work now.

How to be threatening

Now that we have investigated some of the reasons why Marxism is often no longer threatening, we need to ask the final logical question: “what can we do to develop a truly threatening critique of capitalism?” This is a complicated question, and one which I won’t be able to fully answer here. But I will simply summarize some thoughts that come to mind.

First, of course, an accurate and comprehensive understanding of Marx’s initial critique of capitalism is necessary. Our understanding of Marx, in fact, must excel far beyond that of bourgeois planners. But this is also, as we have seen, not enough by itself. We need ongoing Marxist and even other critiques to do this. Often the tools of bourgeois economics and political-economy themselves will provide doors or the tools to open this critique. The complications and abstractions of highly advanced financial capitalism must not be entirely written off simply because they do not fit with our familiar, well-trodden Marxist models. Many times they illustrate Marx’s key findings (e.g. the falling rate of profit) etc. even better than old analytical models (e.g. Iv + Is = IIc).

Second, we need to understand the distinction between thought that is truly threatening and that which is only threatening in appearance. I have already discussed the problems of this here and in previous essays so I will not dwell on it in detail. Suffice to say that the ability of capitalism to cannibalize virtually all of its critiques, and to posit itself as the only logical or possible system, is formidable. We should thus be cautious of so-called anti-capitalist “solutions” because these can often lead to the whack-a-mole scenario described above or just ultimately reinforce capitalism itself.

But capitalist critique is not impossible. Thus the third point, which is that we must remember that change is possible just perhaps not in the ways that seem most obvious to us. Marx ends Capital Vol I, Chapter 10 with the powerful injunction to pass a law abolishing wage labor. This is of course predicated on the working class taking power. Unfortunately he doesn’t offer all the concrete steps to get there in that work. But in his broader theory this strategy is evident. This is to place hope in the working class. Now, this may seem too obvious. After all, the majority of the population is wage laborers of some kind. It is hard to speak, therefore, of a “unified will” of the working class let alone one that can be realized through political action. But what I am talking about is more profound than this. I am suggesting the working class itself as an organization in opposition to and/or an alternative to bourgeois politics altogether. The problem is thus presented not as which political party can best work in the interest of the working class (admittedly, though, most have given up altogether), but rather what actions can the working class take to get capital-bourgeois politics to listen to its demands? What institutions can they work though? What policies and traditions can-should they support? What is at stake is not just at the level of responding to political policies as formulated by the bourgeois, but rather involves the working class developing and expanding its own traditions and institutions in opposition to capital.

The fourth and last point is this. We must remember that a key feature of capitalism involves ceding not only the means of production but also knowledge of the means of production to the market and the private property of the bourgeoisie. Thus critically working toward the dismantling of capitalism necessarily and certainly involves restoring knowledge of the production process. And it also extends far beyond this to restore everything eventually that was lost to the market. This includes cultural traditions, beliefs, customs, and indeed even entire ways of interacting with those around us. This must be the case for any society in which human social interactions are not mediated by the value form (i.e. money + commodity fetishism).

Acknowledgements: Many thanks to Ryan Shaldjian Morrison for his very kind and expert edits on this draft.