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~ Archive for American Economic Fictions ~

Industrial Earthquakes


“Finally, in the same measure in which the capitalists are compelled, by the movement described above, to exploit the already existing gigantic means of production on an ever-increasing scale, and for this purpose to set in motion all the mainsprings of credit, in the same measure do they increase the industrial earthquakes, in the midst of which the commercial world can preserve itself only by sacrificing a portion of its wealth, its products, and even its forces of production, to the gods of the lower world – in short, the crises increase. They become more frequent and more violent, if for no other reason, than for this alone, that in the same measure in which the mass of products grows, and therefore the needs for extensive markets, in the same measure does the world market shrink ever more, and ever fewer markets remain to be exploited, since every previous crisis has subjected to the commerce of the world a hitherto unconquered or but superficially exploited market.

But capital not only lives upon labour. Like a master, at once distinguished and barbarous, it drags with it into its grave the corpses of its slaves, whole hecatombs of workers, who perish in the crises.” (Marx, Wage Labor and Capital)

In Wage Labor and Capital, Karl Marx examines, what he views as, the structural instability of capitalism: its reliance on ever-expanding exploitation. Marx presents capitalism as a teleology — marching along an inexorable path towards a singular end, a crisis. This treatise, written in 1847, comes before his signature work “Das Kapital,” however it can be viewed as an significant precursor. In it, history is presented as a deterministic path and though it appears Marx has yet to come to his vision of a proletarian revolution — that would be articulated nearly two decades later — Marx already believed that capitalism was heading toward a catastrophe.

The ending of Wage Labor and Capital does not present an optimistic vision for the future, but also perhaps gets closer to Marx’s actual understanding of capitalism at the time. He envisions capitalists caught in an indefatigable cycle of expansion, “compelled” to exploit the means of production and yet, by doing so, increasing the fragility of the system that made them wealthy, leading to its ultimate destruction. At this point in his life, Marx believes that “capital not only live[d] upon labour” but also would die upon it too. He saw no outcome for the workers other than “perish[ing] in the crisis.” When he discusses the death of labor, Marx breaks from the analytical tone that he has kept throughout the piece, where he asserts his beliefs methodically as if writing a proof. Now capitalism is wrought in fiery language and metaphor, as if it was a living being, a master both “distinguished and barbarous” who drags the “corpses of its slaves” down with it to oblivion.

But what is the crisis that Marx sees as inevitable? The metaphors he uses are loose, primal in a way. He casts the crisis in terms that suggest the raw force of nature — “industrial earthquakes.” These earthquakes presumably allude to the labor shocks that he thought would occur as industrialization made more and more workers obsolete. The tremors grow “more frequent and violent” as capitalism begins to eat its own tail. Furthermore, his metaphors suggests a biblical or even pagan aspect, when he writes that the “gods of the lower world” require a sacrifice of wealth, products, and even the means of production to be placated. And this infusion can’t suffice but will merely stave off the inevitable. Capitalism, for Marx, survives on a cycle of continuous and expanding exploitation. He writes that previous crises have “subjected to the commerce of the world a hitherto unconquered or but superficially exploited market.” When there are no more markets that remain unexploited the system implodes in a devastating way.

Marx views markets in an interesting manner. He suggests that as the mass of products grows, so to does the need for extensive markets. However, Marx sees the increasing mass of products as inversely correlated with the size of the world market. This seems relevant today, with the glut of products brought about by globalization. As more nations industrialize, and there are fewer undeveloped countries to exploit for labor, capitalism has nowhere to expand. When the American middle class can no longer take advantage of Chinese children, the system implodes. The cycle of exploitation must stop somewhere, but when it does, the outcome isn’t prosperity but rather collapse.


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