Some Marxist Ideas Made Easy

The Ruling Class

The words “ruling class” conjure a group of older, rich, typically white, men sitting in overstuffed chairs in their private club discussing and deciding the future of US domestic and foreign policies. Better yet, images of an annual gathering in a private wooded area spring to mind, with the same wealthy codgers prancing around bonfires and indulging their fantasies before retiring to cigars and cognac and deliberation. To augment these representations, film directors like Jean Renoir (The Rules of the Game), Luis Bunuel (The Discreet Charm of the Bourgeoisie), and Peter Medak (The Ruling Class) have sought to provide vivid, often comical narrative flesh to the manners and fashions of those who are said to decide our fate---the ruling class.

But this is not what Marxists mean by “ruling class.” They do not deny that wealth and power come together from time to time, both socially and to do business, but Marxists would be hard pressed to name all the names and locate the seats of power.

For Marxists, the idea of the ruling class is the answer to an enigma: How does a relatively small segment of the population impose its will over everyone else? How could a tiny minority advance its interests ahead of the interests of the majority? And how could that minority do it not once, not occasionally, but systematically?

By asking these questions, we open the door to envisioning an alternative arrangement, an arrangement that would place the will and interests of the majority first. But first we must provide an answer.

Behind the words “ruling class,” Marxists find the secret of elite rule in a complex system of social relations and processes that compel, control, confuse, or secure consent, while frustrating any attempt to rebel. Ingenious mechanisms-- electoral pageantry, entertainments, competitions, contrived identities, insatiable consumption, and a host of other distractions-- deflect the majority from the question of who should rule. And should some get the bold idea of rejecting this machinery of consent, there are instruments of repression: the police and the judiciary.

These systems of contrived consent and coercion are posed as elements and guardians of “civil society,” when, in fact, they protect the interests of a minority of the super rich and protect them, their minions, and servants from any challenges from the many. Money and its influence fuel these mechanisms; from elections to movies, from lifestyles to consumption, the hand of an unseen class shapes the direction.

Like an electron, the ruling class is studied from its traces. While we cannot see or touch electrons, we know they exist from their relationship and influence upon other particles and processes. That is, their footprint is evidence for their existence. Similarly, the ruling class footprint is all over the social, political, and economic world.

History teaches that nothing beneficial to the great majority comes without a struggle. Why would this be? Who stands in the way of the majority will?

The answer should be apparent: the class that rules by virtue of its accumulated wealth and the power that it buys.

Bourgeois Democracy

“Bourgeois democracy” and “capitalist democracy” are terms that pose the fundamental question of “democracy for whom?” The terms remind us that the belief that there is some kind of pure democracy, a democracy that affords everyone an equal voice in decisions is only attainable when all the advantages of wealth and power are removed from decision-making processes.

Thus, in capitalist society-- what Marx meant by “bourgeois society”-- the wealthy are able to multiply the influence of their sole votes in the democratic process by “buying” elections. They use their ownership of the media, their influence over legislation, their command over political parties, and their vetting of candidates to ensure democracy for the few. The mechanisms for capturing electoral power are, of course, money and ownership.

Despite boastful claims of delivering democracy, the electoral systems of Europe and the US present outcomes that consistently favor the wealthy and their wealth-producing corporations. And when something resembling the popular will arises, it is quickly smothered with an outpouring of media demagoguery and the enticement to compromise. The rare electoral ascent of popular rule invariably faces naked, unabashed repression by the wealthy through their organs of coercion. One only has to review the fascist takeovers and military coups of the twentieth century to understand the limits of bourgeois democracy.

The deception of bourgeois democracy is not that the rules are not fair; in principle, anyone could be elected to an office. Rather, the deception is that everyone has the same possibility of winning an election. Trusted candidates supported by great corporations have an infinitely greater chance of winning against a candidate armed only with integrity and a commitment to social justice. 

And throughout the capitalist world, corporations support only candidates who are loyal to the bourgeois system. Today, the labor movement alone could marshal resources that even remotely challenge a corporate-sponsored campaign; sadly, most of the labor leadership is content to cast those resources before the corporate candidate who is less offensive to working people. And corporate candidates have the incentive to only marginally appear closer to representing the working class.

It is irresponsibly cynical to believe that nothing good can be accomplished within a regime of bourgeois democracy; and it is delusional to believe that fundamental change can be accomplished with bourgeois democracy intact. Reforms-- important reforms-- are possible with a bourgeois democratic government. But fundamental change in the balance of forces between the rich and the rest of us is impossible without fighting to replace it with working class democracy. 

Moreover, the transitional period between bourgeois democracy and proletarian or working class democracy is inherently unstable. Only one class can rule until classes are finally abolished.

Idealists and utopians constantly imagine a smooth exchange of the reins of rule through the bourgeois democratic electoral process. They see the wealthy and powerful recognize defeat and pass the keys of governance on to the representatives of working people. History knows of no such event.

That doesn't mean that working class democracy can't be approached through the bourgeois democratic process. It only means that working people must be prepared to meet every challenge, every reaction mounted to workers' power. Invariably the foes of change will react-- that's why they're called “reactionaries.”

Games of chance, like the institutions of bourgeois democracy-- representative elections, formal legal systems, decentralization of power, etc-- are not inherently unfair. In theory, they give everyone a reasonable opportunity for success. That is their appeal. But in practice, the poker player with far greater stakes will inevitably win. Similarly, bourgeois democracy guarantees that those with the great bankrolls will dominate the game of politics unless they are forced to play a different game.

State-Monopoly Capitalism

“State-monopoly capitalism” is one of the least-well understood ideas of Marxism; yet it is one of the most important.

Marxists understand that for most of the last century capitalism has become more and more monopolized with a shrinking number of enterprises in all of the key industries. This process has resulted in fewer and fewer giant enterprises absorbing or dissolving smaller, less competitive rivals-- the process of merger and acquisition. Old industries like mining, steel, auto, and other manufacturing have grown more concentrated, as have newer technology-based industries like telecommunications and computers.

Some have mistakenly asserted that the Marxist theory of monopoly capital implies that only one or a few enterprises will dominate every industry in time. It does not.

It does predict that the process of greater and greater concentration of capital in the leading enterprises located within an industry will continually be a feature of capitalism. It also implies that the cost of entry-- the amount of capital needed to start up an enterprise-- will grow greater and more prohibitive over time in those industries that have achieved maturity. Thus, it is the process of concentration that is revealed by the theory and not the status of individual enterprises in the capitalist hierarchy. Marx's colleague Frederick Engels put this point well when he exposed the logic behind this process: “Competition is based on self-interest, and self-interest in turn breeds monopoly. In short, competition passes over into monopoly.” Engels affirms that competition will continue, further leading to even greater concentration.

But along with the concentration of capital, another process is at work: the continual merging of monopoly capital with the bourgeois state. The state will play a larger and larger role in the destiny of monopoly capital and, conversely, monopoly capital will obtain a greater and greater role in the operation and direction of the state.

This process-- the underlying expression of state-monopoly capitalism-- is exemplified every day and in every way. The bail-out of financial institutions while mortgagees are thrown under the bus illustrates well the “ownership” of the state by big capital and the disdain of the state for the people. The regulatory agencies of the state grease the operations of monopoly capital while paying little head to the people's interest. The coercive arms of the state function to protect and expand the corporate horizon abroad and protect property and bourgeois values at home. The state establishes secretive and undemocratic trade agreements and global institutions that protect and promote monopoly corporations from the restraints of regional and national interests. The doors of big capital and government swing both ways as their respective leaders change places.

The political Right rails against big government, laying every social and economic ill at government's doorstep. This is, of course, absurd, but not because government is a benign or neutral arbiter of the people’s interests, as liberals want to suggest. The idea that government “bureaucrats” possess some deep-seated evil intent to cause mischief on individuals, businesses, and the economy strains the last thread of credibility. They have no common interest to buttress such a conspiratorial view. The rightist anti-government position is simply the disguise for shilling for monopoly capital.

On the other hand, the liberal position that government stands as a neutral arbiter and guardian of the rights of man is an equal absurdity. Moreover, opinion polls of confidence in government institutions-- notably Congress-- show that the US population knows that it is absurd. The responses of “a great deal” and “quite a lot” of confidence in Congress together barely reach double digits in recent Gallup polls, a showing even below that of the banks.

Election reform, term limits, and the other panaceas will fail to break the solid weld of monopoly capital to the state; only the evisceration of monopoly capital will break that connection.

The Interplay of the Three Ideas

The three Marxist ideas discussed above share many features and interact profoundly with one another. Bourgeois democracy is an instrument of class rule in the era of capitalism, an instrument of the capitalist ruling class. In other eras, ruling classes sustained their rule with other mechanisms.

State-monopoly capitalism is the expression of the most recent, mature stage of capitalist development, a stage that brings with it the most corrupted, crisis-ridden expression of bourgeois democracy.

While the ruling class maintains a stranglehold on governance in this era, its democratic veneer is constantly eroded; more and more of the governed recognize bourgeois democracy as thinly disguised, but naked rule by the wealthy and powerful. At the same time, state-monopoly capitalism exhausts its means to avoid or moderate economic decline or stagnation.

The maturation of these political and economic contradictions generates a revolutionary crossroads, a moment when working people must choose between veritable slavery or taking the reins of power.

Zoltan Zigedy

zoltanzigedy@gmail.com

Stockman’s Rant

On the rare occasion, an article appears in the mainstream press that takes a deeper, more thoughtful view of human affairs, a document that gives a hint or glimpse of an unspoken truth beyond the pablum that occupies media puppets. Such an occasion was the publishing of The New York Times opinion piece entitled “State Wrecked: The Corruption of Capitalism in America” (3-31-2013) and authored by former Reaganite budget director, David Stockman.

Now Stockman is a renegade from corporate Republicanism; he actually believes in the ancient principles put forward by Adam Smith and other classical capitalist thinkers. While corporate Republicans cozy up to their party’s ugly, fascistic outliers, they always, in the end, make their bed with the rich and powerful. Stockman, on the other hand, actually embraces the mythical virtues of small business ownership and town hall democracy. In classical Marxist terms, he represents the ideology of the petite-bourgeoisie.

In the swamp occupied by Democratic and Republican politicos—the breeding ground for conventional politics—such views are unwelcome. Principled politics from the right or the left are alien equally to the snakes and the rats that prey on the cognitively weak and unwary.

Stockman is in a panic because he sees beyond the stock market euphoria and Pollyanna commentaries that have induced the mass delusions of the last several months. And what he sees angers him.

Stockman constructs an indictment, a list of charges against the current US economy: growth of output is woefully inadequate, jobs are both indecently scarce and low paying, the incomes and the net worth of “ordinary” citizens are dropping while poverty is on the rise. To anyone with a grip on reality, these are not signs of real economic recovery or systemic success. He notes that “we’ve had eight decades of increasingly frenetic fiscal and monetary policy activism intended to counter the cyclical bumps and grinds of the free market and its purported tendency to underproduce jobs and economic output. The toll has been heavy.” And yet imagine the toll if no remedial action had been taken! Surely, this unintended critique of eighty years of state-monopoly governance counts as a devastating charge against modern capitalism. If the era of state-monopoly capitalism can do no better than produce the sad state outlined by Stockman, it is decidedly a failure.

Stockman dares speak the truth so discomforting to liberals and social democrats: [World War II] “did far more to end the Depression than the New Deal did,” though he misleadingly praises the Eisenhower years for its “sound money and fiscal rectitude.” Perhaps he is too young to remember the massive increases in military spending, the ambitious interstate highway system, and the enormous growth of public spending brought on by the Cold War and the Sputnik panic. In any case, the dose of war socialism and the “frenetic… activism” of state-monopoly capitalism kept the capitalist ship afloat, though with fewer and fewer rewards for the majority of US citizens.

Stockman correctly sees that the remedies pursued by US state-monopoly capitalism directed more and more of the lubricant of public funds towards the financial sector over the last decades: the Greenspan “put,” the Long-Term Capital Management bailout, extended ultra-low interest rates, TARP, Fed purchases of bank junk, the support of federal bond prices, and support for equity markets. He calls this, not incorrectly, “Keynesianism—for the wealthy.”

And this is a salient point. It is commonplace to express the differences between Democratic and Republican policy makers since the Reagan era as pro- and anti-Keynesianism. But this is wrong. Ironically, it was only during the Clinton administration that growth of government spending was at all curtailed and today fiscal and monetary expansion remains a ready tool of the ruling class well after Reagan's departure. Certainly Keynesian pump priming has taken new and evolving forms over decades: direct job creation, military spending, massive space programs, infrastructure projects, public-private partnerships, repair of financial institutions, and stimulation of financial demand. While one or the other may be the favored priming tool of rulers at any given time, the similarities of the forms are far more important to recognize than their differences. State intervention in markets continues to be at the core of contemporary state-monopoly capitalism. Stockman sees this; others don't.

In Stockman's account, the enabler of pump priming in all of its forms has been debt. Borrowing or printing money is the means to continue the regimen of “frenetic fiscal and monetary policy activism.” But, in his view, this regimen is running out of steam. “The future is bleak.” And the “Fed has incited a global currency war (Japan just signed up, the Brazilians and Chinese are angry, and the German dominated euro zone is crumbling) that will soon overwhelm it...”

A bleak picture indeed, but one entrenched in reality.

So if modern capitalism-- in its state-monopoly form-- is a disaster, does that mean that Stockman advocates socialism?

Definitely not. Instead he holds out for a nostalgic return to the gold standard. Avoiding what he calls “end-state metastasis,” “would necessitate a sweeping divorce of the state and the market economy [the wholesale rejection of state-monopoly capitalism! ZZ]. It would require a renunciation of crony capitalism and its first cousin: Keynesian economics in all its forms. The state would have to get out of the business of imperial hubris, economic uplift and social insurance and shift its focus to managing and financing an effective, affordable, means-tested safety net.”

 In short, Stockman advocates going back to a conjured idyllic time before state-monopoly capitalism, a time imagined by the petite-bourgeoisie as one of healthy competition, entrepreneurship, and opportunity. For him, the golden age of capitalism would be the pre-depression era of small town USA, family farms, vibrant and expansive industry and foreign policy isolationism. Of course any pretense of continuity or viability of that era was dashed by the Great Depression. In fact, the policies decried by Stockman (and associated by Marxists with state-monopoly capitalism) served as a temporary backstop to the further contraction of the capitalist system produced by that fantastic era.

Stockman may wish for a return to an earlier time just as others may wish to time travel back to the court of Louis XIV, but it isn’t going to happen. Capitalism, like any organism, has its own life span, its own history. Saved from a critical illness, capitalism passed from its laissez faire period to a period of intensifying state intervention and management. Today, that phase of capitalism’s development—state-monopoly capitalism-- is also threatened with a critical illness. I would not be so bold as to predict capitalism’s imminent death, but certainly it will not be revived by reliving its past as Stockman fantasizes.

At a time when liberals and conservatives argue pathetically over the right mix of austerity and stimulus, Stockman is a welcome mainstream herald of the profound crisis pummeling global capitalism. His anxiety and anger reflect a deeper understanding of the contradictions of the moment. His rant, spiked with sarcasm and vitriol, stands in stark relief against the smugness of the lap dog punditry.

Krugman Strides into the Ring

 The Stockman screed generated a storm of opposition. Liberals and the fuzzy, mushy left were particularly affronted. Unlike Stockman, they would like to only turn the clock back to the early seventies, another supposedly “idyllic” time when business unionism was generating satisfactory contracts, the “Great Society” programs were blooming, and war in Vietnam was winding down (at least for US combatants). The fruits of the civil rights struggles and urban uprisings were realized in the creation of programs, bureaucracies, and other buffering agents against domestic insurgency. Jobs servicing the Great Society generated a stratum of social liberals who matured into the base of a social democratic left inside and outside of the Democratic Party. For them, the world turned evil and foreboding with the Reagan “revolution,” a movement they characterize as neo-liberalism.

In the dust-up with Stockman, Paul Krugman, columnist for The New York Times, assumed the role of savior and protector of their interests and perspective. Krugman, the darling of the “respectable” left, attacked Stockman for his audacious critique of the track record of state intervention in the capitalist economy. Anyone who follows Krugman knows that his response to the crisis is a simple solution: spend more public funds and spend freely until growth perks up. The soft left finds this an agreeable solution because it promises to save capitalism (and forestall socialism!) while creating a potential material basis for pet welfare programs. It is simply the fantasy of another New Deal. And never mind that Krugman doesn’t share the fantasy!

Apparently, the Stockman-Krugman battle merited a major media appearance before the Sunday morning gasbags, the big stage for what our media passes off as intellectual fare. While I lacked the stomach to watch the sparring between the two, refereed by the likes of Huffington, van Sustern, and Will, I would commend an entertaining account of the match by Mike Whitney in Counterpunch (Krugman vs. Stockman, April 11, 2013).

The merit of Stockman’s account is that he is righteously indignant with an economic system that has failed the great majority of people and inflicted great pain and uncertainty. He goes beyond the dominant rhetoric of “we are all in this together” and “we are all at fault” to find systemic rot in capitalism. He correctly places the blame for this at the doorstep of state-monopoly capitalism, the stage of capitalism evolved to rescue the system from the accumulated contradictions of laissez faire capitalism, contradictions brought to light by the Great Depression. But he cannot go where logic would take him. He cannot entertain options that would transcend capitalism. Thus, he is resigned to a pathetic nostalgia for a bygone era where the contradictions of capitalism did not appear in such sharp focus. While he stretches the bounds of mainstream thinking, he can not see beyond markets and private ownership; he cannot see socialism.

Krugman and most of the US left are thoroughly conventional in their thinking—they offer a more “enlightened” management of the economic system and a cheerful capitalism with a human face. They would be hard pressed to point to a period when capitalism bore a human face, however. Nonetheless, they are undaunted before a rising tide of interest in the socialist option. They are resolute in their fear and rejection of real socialism.

Pressured by five years of relentless economic crisis and increasing signs of favor towards socialism, especially with the young, our feckless left offers a cold plate of empty slogans of localism, anti-consumerism, platitudinous “participatory” democracy, cooperatives, and a vacuous “new” economy. As if these are answers to the $17 trillion dollar US multinational, monopoly capital behemoth. In truth, these are simply evasions and dissemblance. 

If Stockman is right and capitalism is “state-wrecked,” then its time to leave the wreckage and turn to socialism. 

Zoltan Zigedy

zoltanzigedy@gmail.com