The spectre of Marx haunts the debate

Contributors to the debate about capitalism increasingly find themselves obliged to consult Marx, the primary authority on the system, and to try and refute his arguments for its replacement.

The deepening global economic crisis is driving the discussion. Every attempt to resolve it just makes matters worse. Every new set of figures negates the idea that the problems are temporary.

As the Telegraph’s Jeremy Warner has it today: ‘Normally, the economy will bounce back quite quickly from a cyclical contraction, fast rendering the anti-capitalist backlash redundant. But this time, there is no such recovery.”

He points out that more than three years since the recession started, Britain’s economic output is still below the level it reached in 2007. Prospects for growth do not appear on the radar.

Meanwhile, a redistribution of wealth is going on apace – from the poor to the rich. “There is no hardship for those seen to have caused the slump. Bankers and company bosses are paying themselves even more than they were during the boom; the wealth divide continues to widen.”

Warner, assistant editor and leading business commentator, uses his article to bash Ed Miliband (bit of an easy target) for failing to come to terms with changed conditions and declining to accept New Labour’s role in the build-up of debt that has overwhelmed the economy.

But he has to admit: “Rightly or wrongly, capitalism is seen to have failed. To counter rising forms of populism, it must find ways of recreating and reinvigorating itself.” Unfortunately for Warner, the patient’s vital life signs are heading in the opposite direction.

Enter Emanuel Derman, a former managing director at Goldman Sachs, and one of the leading proponents of the financial engineering that propelled the credit boom to its catastrophic collapse. He opens his new book (Models Behaving Badly: Why Confusing illusion with reality can lead to disaster, on Wall Street and in Life) with a famous quote from Marx and Engels his co-thinker and factory owner: “All that is solid melts into air, all that is holy is profaned, and man is at last compelled to face, with sober senses, his real conditions of life, and his relations with his kind.”

Ultimately, however, like many other commentators, he thinks there is life in the old dog of capitalism yet if only the financial system abandoned its reliance on mathematical models. Ah, if the answer were so simple!

To his credit, Derman acknowledges the relevance of Marx while author and academic John Kay, visiting professor at the London School of Economics, tells the readers of the Financial Times that capitalism actually no longer exists (which is news to those under its heel). “The political and economic environment in which Marx wrote was a brief interlude in economic history.”

Kay argues that the nature of share ownership is so diffuse compared with the individual capitalist of 19th century England that “people do not know who owns their work tools because the answer does not matter” while “control over the means of production and exchange matters a great deal to the organisation of business and the power structures of society”. Kay suggests that we abandon the term capitalism and refer to the “market economy” instead.

But far from being a refutation, Kay’s analysis reinforces the method that Marx and Engels developed and used in their work, which revealed not just the inner, contradictory logic that drives the system to its alternating periods of credit-enhanced growth and catastrophic collapse, but the necessity of its continually changing its form.

Most importantly of all, Marx and Engels’ dialectical method showed the temporary, historical nature of the system and how it created the conditions for the socialisation of production. With due respect to Warner, capitalism has not just “seen to have failed”. It has failed in practice and it urgently needs replacing.

Gerry Gold
Economics editor

Scientists made scapegoats for climate change

Reading the blast of outraged hot air in the media about a flawed figure relating to Himalayan glaciers found in a 2007 summary report of the Intergovernmental Panel on Climate Change (IPCC), people might be starting to feel a little uneasy about the science of global warming.

So just to get back to reality, the World Glacier Monitoring Service, which has been measuring 90 glaciers in mountain ranges across the world continuously since the 1980s, has just published figures for 2007/08. These were compiled from satellite images and in-situ measurements of glaciers across the globe.

They found that “the average mass balance of the glaciers with available long-term observation series around the world continues to decrease” and that “the new data continues the global trend in strong ice loss over the past few decades”.

These, plus hundreds of other findings allowed the IPCC to recognise the flawed figure but at the same time restate: “Widespread mass losses from glaciers and reductions in snow cover over recent decades are projected to accelerate throughout the 21st century, reducing water availability, hydropower potential, and changing seasonality of flows in regions supplied by melt water from major mountain ranges (e.g. Hindu-Kush, Himalaya, Andes), where more than one-sixth of the world population currently lives.”

Yet the backlash against science and scientists continues. Yesterday the Information Commissioner accused the University of East Anglia of “crimes” under the Freedom of Information Act, piling more pressure on scientists embroiled in the leaked emails teacup tempest. And a couple of weeks ago scientists (and meteorologists) were forced to explain that a few days of heavy snow does not “disprove” the reality of global warming.

Climate change deniers virtually write as if the scientists themselves are working towards global warming – that global warming is being created out of the science itself. In capitalist society there are two common perspectives on how nature works. One is “teleological”, that is the religious or quasi-religious view that nature is working towards a specific outcome. Or there is the metaphysical, or post-modern view which would argue that there is no purpose or grand narrative in nature – stuff just happens.

There is a very different perspective – a dialectical perspective, which does not artificially separate “cause” and “effect”, but views them as interacting and contradictory opposites. Karl Marx, a key proponent of the dialectical approach, was a big fan of Charles Darwin’s Origin of Species not only because it clarified much about the development of humans in nature, but also because Darwin had dealt teleology in science “a mortal blow”.

About dialectics Marx wrote that it “includes in its comprehension an affirmative recognition of the existing state of things, at the same time also, the recognition of the negation of that state, of its inevitable breaking up.” It is this unavoidable breaking up of the present state of things that the climate change deniers and their corporate and political sponsors cannot countenance, even if it is heralded by a disintegration of the polar ice cap.

The dialectical method, beloved of eminent scientists such as Stephen Jay Gould and Richard Lewontin, can be of huge assistance to climate scientists in grasping the complex interaction between their work on the crisis of global warming, and the crises of economy and politics which are not parallel, but intimately interacting processes taking place in nature.

There is an actual political conflict going on here and scientists are increasingly finding it impossible to stand aloof from it. And of course it is a life and death struggle for all of us, as the reactionary backlash against action to reduce emissions gathers pace in the United States and elsewhere.

Penny Cole
Environment editor

In praise of Charles Darwin

The imminent 200th anniversary of the birth of Charles Darwin, whose theory of evolution at a stroke revolutionised the way we see nature and our place in it, is not simply a moment for the celebration of scientific investigation. It also provides an opportunity to show how historical change takes place, both in nature and society.

Darwin’s great contribution was to analyse evidence he collected over a 20-year period about the abundant variety and difference in birds, flora and fauna and mammals. He collected fossils which showed that the earth was extremely old. This is the basis of his famous theory of the evolution of species, which he published in November 1859.

While he couldn’t provide all the proof at the time, the strength of his evidence was adequate to show that the creation of life on earth was not down to the invisible hand of God but that nature as a whole evolved in a self-related, self-moving fashion. This process of natural selection over millions of years of geological time led to new, more complex species as well as the disappearance of those that couldn’t adapt to the environment around them.

Darwin's ideas on the inheritance of traits was verified independently by Gregor Mendel's work on pea plants in far-away Moravia in the 1860s, although his work did not become well known until the 20th century. For the record, Darwin did not coin or use the phrase the "survival of the fittest" - the reactionary sociologist Herbert Spencer did.

Since Darwin’s time, further scientific developments have verified his theory of evolution. Carbon dating, based on the work of Marie Curie, can now reveal the precise age of fossils while the appearance of similar species on different continents is explained by geologists who can show that the earth was once a single big land mass, while the discovery of DNA in the early 1950s enables us to understand the transmission of inherited characteristics in humans as well as in other animals and parts of nature. Discoveries since Darwin in palaeontology reveal that Cambrian "explosion" - the seemingly sudden appearance of complex animals around 530 million years ago, was an example of "punctuated evolution" and not proof of creationism.

There were, of course, not one but two great revolutions in thinking in the mid-19th century. Karl Marx and Frederick Engels published their Communist Manifesto in 1847. This for the first time set out the evolution of society as a product of the class struggle. They showed how the contradictions within the system of production over time became untenable and gave way through revolution to another system, dominated by a new class. From this, they drew the conclusion that the working class, if it followed Communist leadership, was in a position put an end to capitalism.

Marx was impressed by Darwin’s theory because it indicated to him that society and the natural world underwent movement and change in broadly similar ways, although they were not and could not be identical. In 1873, Marx send an inscribed copy of the second edition of Capital to Darwin, who replied: “I thank you for the honour which you have done me by sending me your great work on Capital; & I heartily wish that I was more worthy to receive it, by understanding more of the deep and important subject of political Economy. Though our studies have been so different, I believe that we both earnestly desire the extension of Knowledge, & that this is in the long run sure to add to the happiness of Mankind.”

Darwin’s work is above all a refutation of scepticism about the possibility of knowledge. Marx’s contribution, in a similarly scientific way, shows the processes of change in society and the periodic interruption of apparently linear evolution through crisis, shock and revolution. We owe these great thinkers plenty at a moment in world history where an evolutionary leap is required.

Paul Feldman
AWTW communications editor