Karl Marx: My thoughts on his philosophy.

Where I explain the importance of "Accumulated knowledge" in Marx's concept of what constitutes the Productive Base of an economy.

Karl Marx: My thoughts on his philosophy.

What was the aim of Marx’s

Philosophy?

Karl Marx [1818-1883] was born in the Hegelian world [1770-1831], who with his Philosophy of Mind, based on Kant’s conception of Man as a rational agent with free will, and with his Theory of History, had profoundly reshaped philosophical thought in Europe.  Hegel’s theory of History, based on his theory of consciousness, traced the evolution of Human thought from the ancients to his time, with remarkably clarity and profundity.  In doing so, Hegel raised the status of History in philosophy to that of Divinity.  History stood deified. 

Roger Scruton writes of him:

“History had replaced eternity [History] as the key to our salvation, and a philosophy which accorded to history and the human, all those dignities which had previously been conferred on the timeless and the divine, recommended itself instinctively to the disorientated conscience of the German romantics.”  

The German intellectual world, tired of Christianity’s incredible myths, took to History, as they had taken theology earlier, as the thing that gives purpose and meaning to life.  Nietzsche, later on was to call this fascination for Hegel’s theory of history, as “concealed theology” because Hegel had made God out of the Man and his history.

Into this intellectual world, Marx began his intellectual journey as a devout young Hegelian, but soon, in steps, moved away from him, especially his metaphysics. Marx retained much of the ground which Hegel had established with his Theory of History but wanted to breakaway from the metaphysics in which it was grounded.  

Marx thought Hegel’s idea of consciousness needed a more grounded explanation.  Much of Marx’s earlier work is an effort to replace Hegel’s Philosophy of the Mind with something more “material.”

Karl Marx started out with two of his own ideas.

Firstly, Marx wanted to return labour to the centre of the philosophical world.  It was a space that common people, labour in Marx’s terminology, had lost out to the bourgeoisie.  Secondly, Marx wanted to forge a grand synthesis of the German philosophy of Human Nature - beginning with Kant’s concept of rational agent in Kant’s Critique of Practical reason, - with the common sense of Empiricist economics of Adam Smith and David Ricardo, to which he added his own Theory of History that somewhat paralleled Hegel’s, but was different from it.

The starting point from Kant’s rational agent perspective is very important. Marx was to argue that Man was alienated from his true self under Capitalism, represented by Kant’s rational agent with free will, and the aim of Communism, his philosophy, was to restore man from his alienation to his true self.

There is profound circularity here in as much as you start from, and end at, the same point but we shall see the reasons that Marx adduced for this circularity.

Marx’s metaphysical 

materialism:

Marx from the very beginning was clear in his mind about two things.  Firstly, that Man interacts with the world around him through his labour, and labour alone.  Marx gathered all the possible ways in which man interacts with nature, and others like him, under the metaphysical concept of labour.  Secondly, Marx went on to posit that Man transforms nature [including social relations with others like self] through his labour, and in turn is constituted by it.  Marx also believed Man’s labour to be a material thing, and not the spiritual consciousness that Hegel had used to construct his Philosophy of Mind.

Marx starts off with Hegel in his earliest work, Manuscripts of 1844, never published in his life time, to show how his concept of labour connects up with Hegel, as follows:

“the ‘outstanding achievement of Hegel’s Phenomenology is first, that Hegel grasps the self-creation of man as a process … and that he, therefore, grasps the nature of labour, and conceives of objective man (true, because real man) as the result of his own labour.”

—- Marx in his Manuscripts of 1944.

Marx wished to break away from the Hegelian construct of evolution of consciousness as a series of contradictions discovered by the self, in relation to others, which the self learns to transcend, thus ascending a ladder of consciousness, from a lower plane to a higher plane.  Marx wanted to show that there were more tangible material forces that drove the process. Consciousness was not something to be assumed, as in Hegel, but explained by a deeper analysis of what creates consciousness.

In his search for such a material explanation, early Marx turned to Ludwig Feuerbach [1804-1872], a Young Hegelian like Marx, whose theory of Man’s ”species-life” in his book, The Essence of Christianity, 1841, also called Gattungswesen, was to remain with Marx as an enduring concept.  

In brief, Feuerbach argued that only man finds himself, and his nature, through social interactions with others like self, and is therefore a socially constituted and determined being.  Thus, only Man among all creatures has species life.  And in as much as “social life” is real, and/or material, it is not a spiritual thing like Hegel’s consciousness, but something tangible and real in the objective world.  In doing so, Feuerbach invented a materialist version of Hegel’s Philosophy of Man, which Karl Marx took to readily.

Marx was to adopt the Feuerbach’s idea and posit his own version of the Hegelian theory of development of consciousness.  

Marx says self-consciousness emerges in three stages or moments:

In the first is the primitive man, dominated by nature, but immersed in his primitive species-life. In the second stage, Man begins to gain some mastery over nature, and treats it as an object for manipulation, and thereby becomes alienated from it.  Thirdly, having gained full mastery over nature, man no longer needs to pursue it as an object, and turns to self-realization or fulfillment of free creative activity.

Marx’s theory completely ignores the individual.  Man is a social being, constituted by his social activities alone.  That is also the essence of his being.  

Marx also parts with Hegel in construing these social interactions as rooted in an objective world, and therefore material, not spiritual.  In doing so, Marx also gives up the Hegelian grounding of his Philosophy in first person, personal perspective, or direct experience of Man, into the third person point of view of an observer.  In short, the grounding for future Marx’s theories lies not in the Kantian metaphysical world that Hegel had adopted, but in the empirical world, where Marx would have to adduce evidence to prove his theories.

We may note here that Marx completely abandons the idea of Man as rational agent, with full agency and freewill.  Instead Man is constituted by his species-life, and Man discovers himself through such life alone.  Marx explains how this happens through his concept of “labour.”

Marx was to construe “labour” as the sum total of Man’s social interactions with the world.  In that sense, Marx’s labour begins as a metaphysical rather than a material entity.  But Marx never made the distinction between metaphysical labour, and labour as we understand the term in everyday language, in his later work, leading to all sorts of conceptual confusion.  But be that as it may, Marx points out by definition, that all of Man’s interaction with the world is only through his labour and nothing else.  

In fact Marx holds that labour generates the language, customs, and institutions - including the economic institutions - through which Man’s self-consciousness is discovered and founded.  In a very deep sense, Marx sees Man as nothing but his labour, which in turn creates his world around him, and he turn becomes conscious of himself in relation to the world his labour creates.  Marx loved circularity.  Though usually not of the vicious kind that spins out of logical control.

Effectively, Marx replaced Hegelian consciousness with his concept of metaphysical labour.  Consciousness then became as something to be explained, rather than the founding ground of the individual.  Hegel was turned on his head.  But Marx’s friend Friedrich Engels, was to describe this inversion of the concepts as “Marx putting Hegel on his feet”  implying it was Hegel who had got it all wrong. More on that later.

Marx’s own early Theory of History:

Corresponding to the three “moments” of human consciousness, are three stages of history, each manifesting itself as a stage of Man’s stance towards the world. With the theory of history comes the notion that not only does labour constitute all the ways in which Man transforms his world, but it is through his labour that man defines his relation to the world.  Marx thus wants to give primacy to economic forces as the driving force of history rather than self-consciousness.

In Marx’s early theory of history, the natural man is the primitive man dominated by nature, living out his existence per nature’s dictates.  During the second stage, man learns to acquire some mastery over nature for his use.  He thus begins to acquire useful artifacts to ease his life, make tools etc., and the institution of private property develops. This separates man from nature as nature becomes an object for man.  But private property also separates man from man as private property is not communally shared.  Private property generates the institutions of exchange, modes of productions, or the economic system we know as Capitalism.

However, as Man’s mastery over nature is completed, and production of artifacts becomes plentiful, the need for private property turns obsolete/redundant. Thus with plentitude [generated by Capitalism] man no longer needs private property.  Man can now transcend private property, stop treating nature as something to be exploited, and end his alienation from others like self.  Man thus becomes free from want, and can go back to his species-life and fee creativity.

I shall return to this point again as I discuss Marx’s later theory of history and the material forces that drove it.  But do note what the Marxist, keen on their revolution, and lust to seize power, have been hiding from us.  

Communism naturally follows Man’s mastery over nature, which enables him to produce goods and services that he needs effortlessly, and in such plentitude, as to render the institution of private property meaningless and redundant.  You do not get mastery over nature, and plentitude, by banning private property now.  It is instead the surest recipe for disaster as experience shows.  The need for private property recedes after plentitude itself makes it redundant.  Communism in turn follows such plentitude but does not create it.

I have not figured out why this crucial aspect of Marx’s philosophy has escaped the attention it deserves in literature.  We shall see more on this in Marx’s dialectical materialism where he jettisoned all metaphysical concepts of labour and history to propose a purely empirical theory of both; that he thought proved his point.

In trying to marry empiricist economics with his theory of history, Marx hit on a profound flaw in the liberal empiricist economics of Adam Smith, that has been ignored by liberal philosophers as well as modern economists, but has profound consequences.

Briefly. private property in liberal theory begins with John Locke’s [1632-1704] idea as Man mixing his labour with nature, thereby acquiring a “natural” right to the fruit of his labour, which then becomes his private property.

He may then exchange or trade this private property for other stuff that he needs, in privately negotiated deals, as between free principals, in pursuit of his own advantage [profit].  Adam Smith and other liberal economists, thereafter tracked the exchange value of this property through it contractual value, paying scant attention to the original “natural” right that arose from mixing Man’s of labour with nature.

Adam Smith showed, that to the extent property was traded by free exchange between free men, the process not only preserved justice, but also benefited society as a whole.  Therefore there was no need to go back to  how the private property began, & the natural right to fruits of labor in which it was founded.

In all of these exchanges, spanning centuries, not decades, the nature of man, doesn’t change.  Essentially, under Adam Smith’s implicit assumptions, the 18th Century man’s nature, and that of the 21st century man, is the same.  If it were not, the change in his nature itself would affect the price at which something was traded, and the demand for property itself would be a variable.  Liberal theory has no Philosophy of Human Nature to explain such fundamental questions.  It is rather focused on movement in price and prefers to explain it all by excluding change in nature of man itself as a variable. 

If this argument sounds too abstract, think of it this way.  When man’s mastery over nature creates a plentitude of goods & services, such that there is no need for private property, the demand of property itself vanishes.  Now the quest for property is what drives all of our economic impulses.  It is at the centre of our economic motivation.  If that centre vanishes, what would drive economic behavior instead of quest for property?  Liberal theory has no answers.

For Marx however, as for Hegel, albeit in a different metaphysical way, Man is not a constant unchanging construct, but is a historical being, continuously evolving in tune with how he contributes his labour to nature, and what he receives from it in turn. In short, Man evolves, his nature changes, and what he demands from the world, and what he is able to offer for it in turn, are not the same though time.  

For liberal economists however, Man is a given constant by nature, and not a product of history, that is continuously evolving.  As we saw earlier, this gaping hole in the liberal theory comes from a lack of a suitable Philosophy of Human Nature to back up assumptions made regarding the nature of man inherent in liberal thinking.  The whole of Marxist thought meanwhile depends on Man being a product of history.

Given that the evolving nature of man is evident from our own epistemology, the liberals need to fill the vacuum in their idea of history, and what it means for Human nature.  This is one the deep reasons why Marxist thought - especially its theory of history, - comes across as so much more profound than liberal theory.  Modern economists should note that all their constant “preference curves” and the like, are so much bunk, absent a proper philosophy of human nature that explains those unchanging “preferences.”

But before I go on to Marx’s dialectical materialism, we need to take a detour through his theory of “alienated labour” in order to understand why he jettisoned his early metaphysics, and embraced a purely empirical approach to his thought & theories. As I warned, some repetition of ground is inevitable in discussing Marx changing philosophy, but each time he shifts ground, there are subtle changes in the way he engages with his philosophy, and these shifts are important to understand his thought.

Marx’s theory of Alienated Labour:

Marx’s theory of alienated labour has its genesis in De Brosses’ theory of fetishes, that he [Brosses] propounded in his book [Du cult des adieux fetches, 1760].  Immanuel Kant picked up the theory from De Brosses and gave it philosophical content in his Philosophy of religion.

For Indians, this theory by Kant is profoundly important in understanding Indian philosophy - both Vedic, as well as Jain and Buddhist, schools of thought.  I shall return to this point in a future essay but pay attention.

Kant [1724 -1804], taking off from De Brosses [1704 - 1777] sought to distinguish between genuine religious thought, which seeks to rationally understand God, his own self, and the relation between them, from spurious religiosity or fetiches, where man projects his subjective fears, myths, and conceptions, onto nature, and gives nature, including inanimate things, attributes much like he himself possesses. In short there is difference between a rational attempt to understand the world, and blind awe of nature through superstition and occult.

Attributing his own subjective characteristics to nature is a fetish that obscures the true nature of the world, and creates another barrier between man and nature that he must transcend.  

“Fetishism obscures the subject’s relation to the world, absorbing his human life into the vain worship of objects, and cutting him off from the true understanding of himself, as an autonomous being in intrinsic

relation to others of his kind, and to a transcendent God. Fetishism does not make the transcendent personhood of God immanent in the world. It endows the world with a false aura of immanence, painting phenomena

in the subjective colors of a finite will. It therefore creates an impassable barrier between the self and God.”

In short fetishism is faux religiosity stemming from inadequate understanding of nature. It is a consequence man ignoring his own inherent quest for rationality.  And it involves endowing things in nature with man’s own attributes, characteristics, and motivations.

Hegel was to take this idea of fetish from Kant and explain alienation, or Entfremdung, in a more general way. 

When man separates himself from nature, and being dominated by nature, is forced to concede less than perfection to himself, while conferring super natural powers on the dominant nature.  When nature is treated as God - the perfect being - Man senses his own inadequacy giving rise to alienation from the perfect. 

“Hegel argued that the religious spirit is a spirit which, because it sees itself detached from and

in opposition to the sphere of perfection, is a spirit in self-alienation, essentially unhappy in the consciousness that it is not what it is naturally destined to be. It is not perfect. (It is ‘fallen’, as the Christian doctrine puts it.) 

This applies not only to the Kantian fetishism but also to any religion, in so far as religion reflects man’s sense of his own imperfection, of his absolute

solitude in the world of creation, and of his dependence on a being that lies beyond the sphere of objective knowledge.”

Marx’s old inspiration for the concept of “species-life”, Ludwig Feuerbach took this idea from Hegel further to say all religiosity was spurious since it alienated man from himself.  Men project out of themselves, and make into properties of a divine being, the perfections which are really theirs. In removing his own perfections and giving them onto a transcendent world, man makes his own perfection unobtainable.  Hence he becomes estranged and is alienated from his species-life where perfection is possible.

If that appears rather abstract, consider the following argument.

Why would man buy religion if he did not think of himself as “fallen” and therefore in need of redemption?  

So the first job of the priesthood of any religion is to show you that you are “fallen” and in need its services to escape perdition or worse.  In Christianity, you are fallen because you are born in sin, committed by your distant but extremely lustful ancestors, in the Garden of Eden.  For that simple sin, now growing at a compounded rate of interest, you owe your soul and life to the Church and its priesthood.  

Other religions have similar devices built into them.  This alienates man from his true nature.  Basically this is the broad idea that Marx borrows from the theory of fetishes.

Once you accept that you are not what you should be, you are in alienation from that which is perfect.  The perfect is God, but you as the imperfect being cannot be with God.  This alienation or estrangement can only be eliminated by your perfection of your own being for which you must follow due process that your religion, whatever it is, prescribes.  

But who created the perfect being that you wanna be?  The priesthood and religion hum & haw on this point but the real answer, is you yourself created this idea of perfection and the perfect being.  It doesn’t exist beyond yourself.  But ritual, dogma, the hermeneutics of scriptures, and priestly greed - all combine to blind you from seeing the truth that the perfection you seek in and through God in yourself was your own creation in the first place.  In a very true sense, you are the God you wanna be part of.  This inability to recognize the reality is fetish.

But Marx argues that Man’s fetish is not so much with religion as with private property. Marx was never able to establish this connection between fetish and property directly.  

Nevertheless, you can follow his thinking by noting that attachment to property was first criticized by Aristotle in his critique of mercantile life.  The idea was also picked up by Christianity, which for a long time held that attachment to worldly goods alienated man from God. The idea gained a new lease of life as usury replaced slavery in medieval times, forcing the Church to denounce the evil.  So Marx’s idea of property as a fetish has some basis in history.  But the philosophical argument to establish man’s alienation is caused by a private property fetish is lacking.

Marx sought to establish his point by an alternative approach, first introduced by Kant, that man, as a rational agent, must never use other agents like self as means to an end, but only ends in themselves.  Hegel took this ethic further in his mater-slave dialectic and its transcendence through equality.  

Marx argued, man invests property with characteristics that are ends in themselves, rather than a means to an end.  As such he endows property, especially when it acquires an exchange value,  with a “soul” or life of its own.  This happens when property is pursued purely for accumulation in order to use it control others in future.  Secondly, property gives man the right to future labour of fellow men who can then be bought and sold like other property.  Thus the Kantian moral imperative is violated and man becomes an object for man.

Marx then went on to examine the value of a property in terms of its use and exchange value.  Fetishism develops as property develops from use-value, which is related to its usefulness to human needs, to exchange value, in which the commodity begins to acquire a life of its own.  When exchange value dominates, as in the case of money, property is completely transformed into a fetish and that is the essence of private property under Capitalism.  It gives one control over future labour not even born.  This allows labour to be bought & sold like a commodity in return for property.  Thus, at least some men become “slaves to commodities”, either as users or as those used.

Marx wrote:

“Money is the universal, self-constituted value of all things. Hence it has robbed the whole world, the human world as well as nature, of its proper value. Money is the alienated essence of man’s labour and life, and this alien essence dominates him as he worships it (‘On the Jewish Question’).”

That’s Marx on why his theory of labour, and theory of history, which  together lead to a bleak existence for man in moral/spiritual terms, and also cause exploitation of man by man.

Marx replaced all this moralizing & metaphysical argumentation in his later work with a very empirical theory of dialectical materialism.  I have however, examined his metaphysics here in order to understand why Marx did what he did, and the motivation behind it.

Be prepared for some - not much - repetition as we reformulate all this in terms of dialectical materialism later in this essay.

But two points to note.  Firstly, you can’t overthrow Capitalism by a revolution of the French type that overthrew aristocracy.  The fall of Capitalism happens by itself through a problem of plentitude, brought about by man’s mastery over nature.  Yes, you can fight exploitation of man by man in many ways, but Capitalism doesn’t fail because of it.

Second, Marx never established his case for property fetish, as I have, by giving property control over future labour.  I have used the argument here to lend greater clarity to Marx’s idea that property does cause fetish.  One can never be sure if that is what Marx meant.

Last point, as noted earlier, Marx jettisoned all this metaphysical theory of labour and the theory of history in his Das Capital, preferring to completely base his later theories as scientific or empirical propositions, that stand or fall on the basis of their own truth.  So what I have said so far is essential to understanding of Marx, but not the operative part of his theories.

Mind, a large number of Marxists, the so called Frankfurt School, have spent years and decades trying to anchor Marx’s metaphysics in Hegel as a sound school of philosophy, without much success.  Some of their arguments are as fantastic as Shekhar Gupta’s thesis on Modi’s astute politics.  They, like the erudite editor ji, forget why politics is necessary in the first place, as an ethical system, to allocate resources and resolve contentious issues.

Later Marx and his theory of dialectic materialism:

Having dealt with most of Marx’s philosophy through his metaphysical theories of labour and history, an examination of dialectic materialism, and its new associated theory of history. is straight forward in comparison.  

I examine it briefly to see how Marx’s thought evolved, and why he failed to catch his own errors even after jettisoning the earlier faulty metaphysics in his later years.

In later work, Marx attempted to separate his theory of human nature from his theory of history and ground both as materialist propositions that would be proved by empirical observation like any other social theory, taking them away from any philosophical moorings to a first person, personal experience.  

The aim of this move was to give substance to his claim in the German Ideology that “consciousness does not determine life, but life determines consciousness.” 

In doing so Marx made little use of his theory of fetishes so elaborately crafted for his early work, although the concept survives as “commodity fetish” in the Capital to explain attachment to property.  

Instead Marx posits that Man is a victim of “false consciousness” where false consciousness is something where Man makes universal errors of judgement rather than than any one particular error.  To prove false consciousness, Marx cites exploitation of labour, where man uses another’s labour to acquire capital.  This evidence of exploitation itself causes false consciousness because, no rational agent with full agency and free will would do such a thing. [The Kantian imperative.]

Marx moved to the new formulation after he replaced Hegelian theory of History that runs in parallel with his three moments of consciousness and argued that it is material forces, that cause consciousness to develop.  Marx then argued that the fundamental things that develop, so as to bring movement of History, are not features of consciousness at all but material forces.  The development of consciousness is to be explained by material reality, and does not explain it.

This is the basis of the famous quote by Friedrich Engels, [noted by Ludwig Feuerbach in The End of Classical German Philosophy] that Marx’s theory of History “sets Hegel on his feet.”  Actually it turned Hegel on his head but we will let it be.  

It was “material force” that would cause Capitalism to collapse through over-production, enabling Man to replace it with a more Humane social and economic arrangement.

What were the Materialist forces?

Marx proposed that the base of all human institutions is that upon which the forms of consciousness are built, and in terms of which institutions, and the consciousness that derives from them, are to be explained.

“The base, Marx held, consists of two parts: first, a system of economic relations, and secondly, certain active productive forces.  The existence of any particular system of economic relations is explained in terms of the level of development of productive forces.  These productive forces in turn consist of labour power and accumulated knowledge. As man’s mastery over nature increases, the productive forces will inevitably develop. At each level of development, a particular economic relation will be more suited to contain and facilitate their operation.”

The stuff in bold is my emphasis on a quote by Roger Scruton that explains why Marxists get Marx so wrong.  I have touched on it before and will revert to it later.  Roger Scruton doesn’t use my argument though.

“Upon the system of economic relations rises the superstructure of legal and political institutions.  These serve to consolidate and protect the economic base, and are therefore explicable in their sustaining and protective function.  Finally, the political institutions generate their own peculiar ideology. This is the system of beliefs, perceptions, values, and prejudices, which together consolidate the entire structure, and serve both to conceal the changeability, and to dignify the actuality, of each particular arrangement.”

So that’s the base and the superstructure of Marx materialist forces that drive both consciousness and history.  Why the separation into base and superstructure?  As Marx explains later, it is the superstructure that is overthrown under communism, leaving the base intact to continue with its productive work but under a new superstructure that is more humane.  Marx never got around to explaining how the new utopia would actually work.  Just that the one under capitalism would go to end exploitation of man by man or labour.

Marx posits there are roughly five economic arrangements under the superstructure of his materialist forces.  They are primitive communism, slavery, feudalism, capitalism and communism.  The last is distinguished by the fact that, under communism, the necessity for a legal, political and ideological superstructure vanishes, together with all its apparatus and the “false consciousness” which surrounds it.  

More important is what causes the superstructure to become unnecessary, and here we have the key to that Marxists are loathe to admit to.

Consider what is at the heart of Marx’s productive forces.  It is firstly labour, and secondly accumulated knowledge, or what we might call technology & knowhow.  Labour available on a per capita basis is fixed.  It by itself cannot contribute to growth over a given level, never mind Marx theory of exploitation.  There are only so many hours in a workday.  So what does grow, and grows “inevitably” as Marx himself notes, is accumulated knowledge or man’s mastery over nature.  [This is an observed fact.  Man’s store of knowledge has grown while working hours per per person have fallen.]  So this implies that the non-linear or exponential growth in output necessary to create the plentitude of goods and services necessary to cause Capitalism to collapse through overproduction can only come from accumulated knowledge.   

Exploitation of man by man ends,  not when communists comrades take charge of the productive forces, and start rationing out goods and services.  They only produces misery when they do that.  Instead the exploitative structure becomes redundant because, man’s mastery over nature, through accumulated knowledge, obviates the need for such exploitation.  Marxists turned Marx on his head by trying to bring about a communist revolution before we have achieved the required mastery over nature.

Who owns and controls the store of Man’s accumulated knowledge?  How does it grow?  As I have argued, this is the beast, [& not the Sanghi Bhist,] that actually drives history and consciousness in Marx’s thought; not so much the “exploitation” that Marx focussed on.

Secondly, and we shall go into Marx’s theory of value created by labour next, do note what Marx attributes to labor.  In his arguments, all value is created by labour alone.  In a very fundamental sense, you might say this is true because accumulated knowledge is also created by labour.  But in reality this notion is false.  The labour that creates the store of knowledge is actually saved labour from any direct productive processes, and specifically directed at researching new techniques, or making new tools.  Saved labour differs from direct labour in that it is already capital or property, a thing Marx abhors.  And it is also the most productive part of materialist forces responsible for non-linear growth that causes Capitalism to collapse eventually through a surfeit of goods and services.  

For Marx then to argue that only labour [or direct labour] creates value is a false notion.  Accumulated knowledge creates more value. Marx mentions accumulated knowledge, correctly attributes much value to it in enhancing productive forces, but assumes this happens for free.  Worse, he ignores the store of knowledge completely thereafter in his theorizing. 

Furthermore, the accumulation of such knowledge goes on all the time over centuries of Man’s history.  No existing labour owns this store of knowledge, nor may its value be attributed to the body of men and women who now constitute labour.  And there will inevitably be inventors and entrepreneurs who added to this store and demand property rights over them.  How should the economic claims of accumulated knowledge to be adjusted against what is currently available as labour?  Marx provides no answers.  Fact is he didn’t even recognize the contradiction that he himself created for the second time in reformulating his theory of history as a materialist force.

Now let us look at Marx’s labour theory of Value that he borrowed from David Ricardo [1772-1823] and adopted for his own purposes.

As we saw in Marx’s earlier formulation of his theories, then based in metaphysics, Commodities have both a use value and an exchange value.  Use value is easily explained in relation to the actual use the commodity is put to.  What explains exchange value and how does that make it possible for somebody to accumulate exchange value through the operation of the market?

David Ricardo in his labour theory of value, posits that the exchange value of any commodity is simply the number of socially necessary hours of labour needed to produce it.  [Liberal theory thinks use value is already in the exchange value as part of it and hence need not be separately tracked.] The more labour required, the higher the exchange value.  Marx latched on to this explanation by Ricardo to reformulate his theory of exploitation of labour under capitalism.  

“The accumulation of exchange value as surplus is then explained in terms of extortion of labour from the laborer, by exchanging his means of subsistence for hours of labour in excess of those needed to produce those means.”  

Marx thus makes the case that the existence of any & all surplus value must necessarily be explained in terms of labour used but not paid for. [Exploitation of labour, and hence a violation of the Kantian moral imperative, and therefore the key reason to overthrow Capitalism, in order to restore man to his rational self, free of the property fetish.]

Marx assumption is without basis under free market conditions and fully true only under slavery.  Hegel would argue even against such an assumption under slavery.  But nevertheless, Marx assumes such exploitation of labour as the basis of his new theory of human nature that triggers history to overthrow Capitalism.

Marx’s assumption that only labour produces any value flies in the face of his own assertion that accumulated knowledge is a key part of his productive forces.  Nor does Marx give much thought to how to value the store of accumulated knowledge that actually and visibly drives history in our everyday experience.

There are other deep philosophical issues that arise with respect to store of accumulated knowledge and Capital itself [assuming Capital itself is nothing but saved labour] when you bring the time dimension into the matrix of productive forces and try to balance inter-generational equity. 

This is true not only of Marx’s ideas but also those of the liberal theories.  There is this notion of unearned gains when wealth passes from one entrepreneur to his progeny.  Or windfall profits to certain types of property holders when technology changes, completely revising the valuation matrix in society.  

On the negative side, changes in store of accumulated knowledge render whole industries obsolete making large number of workers redundant. Material forces not only create value but also destroy value, and if one looks at history, value destroyed as redundant far exceeds the value currently in use.

So Marx’s simplistic but critical assumption that all value comes from labour is deeply flawed and misleading.  The reality should give more weight to store of accumulated knowledge and once you recognize that, the entire Marxist theory of base + superstructure driving history, and constituting consciousness, becomes inconsistent needing complete revision.

The Chinese experience after Deng:

The Chinese experience in using the apparatus and institutions of Capitalism to expand its productive potential and GDP amply bears out my two points about accumulated knowledge and its role in expanding an economy’s output, and the fact that a premature communist revolution is unnecessary to cause a collapse of Capitalism going by Marx’s own materialistic theories of history.

China has been able to harness many features of Capitalist system without these institutions clashing with their Marxist ideology.  Why?

Marx was categorical in preserving the “base” of a society or economy even after Capitalism is made redundant due to plentitude.  In his view only the “superstructure” comprising the political institutions, legal codes and ideology that serve to protect Capitalism and its inherent exploitation of labour, need to be dismantled.  

The productive forces, comprising labour, accumulated knowledge and the minutiae of economic relations between them [such as market?] Will be preserved even under communism.  This is precisely what China is doing.  Preserving and expanding the base of productive forces exactly as if it were a Capitalist society but using the “superstructure” of communism - the political institutions and legal codes - to govern the polity.

It is not something what Marx envisaged but it comes closer to his ideas than the system followed by Lenin, Stalin & Mao, who used the revolution to overthrow the superstructure, but ruined the base as well, with horrible state ownership of all parts of the base, killing private enterprise.  I am not sure Marx would have approved such destruction of the base - labour and accumulated knowledge - that in fact makes communism possible - even if only as a dream.

As I said before, communism becomes possible as system only after Capitalism has already established man’s mastery over nature, such that the institution of private property itself becomes redundant due to plentitude and resultant level of prosperity.  Communism under a true reading of Marx is for the very rich, mature societies; not for the poor.  Premature communism only brings misery in its wake by its inability to expand the base of the economy and that of its productive forces.

For those wanting to adopt this argument for “blood and claw” capitalism, I have bad news.  Private monopolies are worse than public monopolies and most ruinous of value.

So what did Marx achieve?

Later Marx had three strands of thought running concurrently: his conception of the nature of man as product of history, the movement of history itself, and the structure of economic value created by Man’s labour.  All three strands together seek to explain what causes man’s consciousness.  But all three are also independent of each other and can stand or fall on their own.

The thing that causes consciousness, according to Marx is “material” as it transforms nature, and it is “social” in as much as it exists in relations between men.  Add to this Marx’s proposition that the only way man interacts with the world is through his labour, and you have Marx placing “labour”, or people, at the centre of all Philosophy, something no one had done before. Labour is the human essence, the driving force of history, upon which it superstructure of political & legal institutions feed.  

However, this pole position in philosophy comes at huge price, the price of losing the individual to the general concept that Marx calls Labour.  No where in the Marxian thought, the human exists as an individual because he is limited to interacting with his world only through labour.

Whether he is alienated in chasing his property fetish, and thus becomes a slave to the superstructure, or he is restored to himself under communism, he is only his labour, nothing else.  Even when the fetters of Capitalism fall away after Capitalism has eliminated need for property, Man will be restored to full creativity but only as undifferentiated labour.

The moment he tries to assert his individuality, the struggle for domination of one sort or the other begins again, and politics of another sort starts a struggle for domination.  May be this time it not about private property since that is now redundant.  But politics and history will begin again as another Glass Bead Game because the “Will to Power” is eternal, as Nietzsche would say.

Marx did that, made labour central to philosophy, but his thesis was so flawed that the only use it was put to was to serve tyranny as a manual for seizing power that Marx would never have advocated.  The tyrants could not wait for the base to provide the goods & services necessary to terminate private property.  And in terminating private property prematurely, they also terminated whatever prosperity that existed.  

Only the Chinese were smart enough to realize in time, but not before butchering 6 million of their own, that Marx wanted the base to create prosperity in plenty before ushering in communism as the utopia most suitable to the new prosperity that had already eliminated need.  Not before.