To mark the 200th anniversary of the birth of Karl Marx, Tom Coyle and James Oldham debate his legacy.
Here, Tom Coyle argues that Marx has been proven wrong.
Karl Marx was a man of his time.
Unfortunately, his theories haven’t stood the test of time
Saturday 5th May marked the 200th birthday of the socialist economist and philosopher Karl Marx, who famously wrote The Communist Manifesto (recently published as a graphic novel). To mark his 200th birthday I am going to look back at some of the economic theory he produced and highlight the shortcomings of his ideas.
The Labour theory of value was one of the cornerstones of Marxian economics and it states that the value of products isn’t determined on how much pleasure the owner gets out of the product but by the the average time it takes to produce a good. Marx believed that capitalists who owned the means of production were able to extract “surplus value” from the workers and so were exploiting the workers as they weren’t paying them for the value they created. However in modern life you can throw out the labor theory of value because, in the post-industrial era there is less and less actual labour happening. The real source of value now comes from intellect and thought instead of manual labour. Thought and reasoning is what gives something value now when buying an iphone for example; the value isn’t from the production line but from the engineers who designed it.
Marx also created what he called scientific socialism which was an attempt at combining his economic theory with his philosophical ideas. It essentially claimed that in a free market economy eventually the competition would become so fierce that there would only be a few monopolies remaining, ultimately exploiting the workers and consumers through lower wages and higher prices. He then went on to say how this would cause mass unemployment and eventually lead to the overthrow of the capitalists and the entire system. However, as we have seen over the last 150 years, this has not been the case, and, in fact, wages have risen without the loss of profits (in spite of what Marx predicted).
Marx thought that the only way to run a fair society given technological advances and the existence of capitalists was to overthrow the capitalists and implement a socialist society. Today we know that socialism, however ideal it sounds in theory, doesn’t work in practice and leads to systemic poverty for the masses and gives rise to dictatorship.
I think this shows how Marx was a man of his time and that his theories haven’t stood the test of time.
James Oldham responds that it is still too early to say Karl Marx was wrong
Here, Tom Coyle argues that Marx has been proven wrong.
Karl Marx was a man of his time.
Unfortunately, his theories haven’t stood the test of time
The Labour theory of value was one of the cornerstones of Marxian economics and it states that the value of products isn’t determined on how much pleasure the owner gets out of the product but by the the average time it takes to produce a good. Marx believed that capitalists who owned the means of production were able to extract “surplus value” from the workers and so were exploiting the workers as they weren’t paying them for the value they created. However in modern life you can throw out the labor theory of value because, in the post-industrial era there is less and less actual labour happening. The real source of value now comes from intellect and thought instead of manual labour. Thought and reasoning is what gives something value now when buying an iphone for example; the value isn’t from the production line but from the engineers who designed it.
Marx also created what he called scientific socialism which was an attempt at combining his economic theory with his philosophical ideas. It essentially claimed that in a free market economy eventually the competition would become so fierce that there would only be a few monopolies remaining, ultimately exploiting the workers and consumers through lower wages and higher prices. He then went on to say how this would cause mass unemployment and eventually lead to the overthrow of the capitalists and the entire system. However, as we have seen over the last 150 years, this has not been the case, and, in fact, wages have risen without the loss of profits (in spite of what Marx predicted).
Marx thought that the only way to run a fair society given technological advances and the existence of capitalists was to overthrow the capitalists and implement a socialist society. Today we know that socialism, however ideal it sounds in theory, doesn’t work in practice and leads to systemic poverty for the masses and gives rise to dictatorship.
I think this shows how Marx was a man of his time and that his theories haven’t stood the test of time.
James Oldham responds that it is still too early to say Karl Marx was wrong
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