Karl Marx Was All for Free Trade

♠ Posted by Emmanuel in , at 5/23/2008 12:32:00 AM
It never ceases to amaze me that posts on the topic of Karl Marx [1, 2, 3] remain among the most popular ones here since I am hardly an authoritative commentator on Marxist thought. Nevertheless, coming from the school of "give them what they want," I will give Herr Marx the pride of place in this post. Cool Papa Marx rides again. For ideological reasons, Marxist thought plays a larger role in British public discourse and academia than in the States. You must remember that Marx is buried in London, and that a BBC poll in 1999 found he was the most influential thinker of the millennium ahead of Einstein, Newton, and Darwin. Would such a survey have returned similar results in the US of A? I think not.

Speaking of British academia, I am currently reading Capitalism Unleashed: Finance Globalization and Welfare by the late, maybe even great Oxford Marxist economist Andrew Glyn. While most of its content is boilerplate socialism with a few references to modern events thrown in, I came across an absolute stunner of a quote on p. 77 where Marx extols free trade. However, there is a supremely sardonic twist to Marx's idea: Free trade, by extending the contradictions of capitalism to all the ends of the Earth, will only hasten capitalism's demise. (See this earlier post for a Cliff's Notes version of the contradictions of capitalism if you are unfamiliar with the basic idea.) A problem with this line of thought, of course, is that few of us are as convinced as Marx about the internal contradictions of capitalism will bring about its demise. It keeps rolling along.

Of course, a coarse analysis would instead point to the demise of the Iron Curtain as a demonstration of the failure of socialism. Still, those who argue that Lenin's iteration of socialism that soon became a prominent feature of the international political economy was not as Marx intended. The "vanguard of the proletariat," Lenin's bastardized version of Marxist leadership, can in retrospect be seen as reformulating the bourgeoisie with class privileges intact under the rubric of socialism. Nowhere is this more evident than in China's variant, replete with inequality surpassing that in many (nominally) capitalist countries and Party elites. In other words, the failure of Soviet-style communism is not the failure of Marxism as the former was not representative of the latter as described by its principal author. Indeed, the more left-leaning can make an argument that the current time is ripe for making the contradictions of capitalism even more apparent than before.

It is debatable, though, whether the never-ending bliss of paradise (where the grass is green and the girls are pretty) promised by Marx after the overthrow of capitalism's shackles would be any better than what we have now. And, invoking that presumes the tipping point for fomenting the oft-predicted workingman's revolution would soon be upon us. Or, is "The Man" too big and too strong?

Anyway, on to the Marx passage in question. The essay below comes from The Northern Star, a publication of the British Chartist Movement to which Karl Marx was sympathetic to. It is Marx's undelivered speech to a gathering of those endorsing the idea of free trade--The Free Trade Congress in Brussels--in 1847. It is illuminating that today's three main IPE points of view as noted in this blog's FAQs are all in there in full guise--mercantilism (List), liberalism (Smith and Ricardo), and Marxism care of the eponymous author. That modern political-economic debate still mirrors the well-formed thoughts of Marx on the differences among these POV is illuminating, as is his conviction that, yes, the demise of capitalism is nigh. Marx being Marx, he's rather long-winded talking about Protection, Free Trade, and the Working Classes, but the last paragraph below best summarizes why Marx believed that, yes, free trade was a splendid idea. Does revolution await?

There are two sects of protectionists. The first sect, represented in Germany by Dr. List, who never intended to protect manual labour, on the contrary, they demanded protective duties in order to crush manual labour by machinery, to supersede patriarchal manufacture by modern manufacture. They always intended to prepare the reign of the monied classes (the bourgeoisie), and more particularly that of the large manufacturing capitalists. They openly proclaimed the ruin of petty manufacturers, of small tradesmen, and small farmers, as an event to be regretted, indeed, but quite inevitable, at the same time. The second school of protectionists, required not only protection, but absolute prohibition. They proposed to protect manual labour against the invasion of machinery, as well as against foreign competition. They proposed to protect by high duties, not only home manufactures, but also home agriculture, and the production of raw materials at home. And where did this school arrive at? At the prohibition, not only of the importation of foreign manufactured produce, but of the progress of the home manufacture itself. Thus the whole protective system inevitably got upon the horns of this dilemma. Either it protected the progress of home manufactures, and then it sacrificed manual labour, or it protected manual labour, and then it sacrificed home manufactures.

Protectionists of the first sect, those who conceived the progress of machinery, of division of labour, and of competition, to be irresistible, told the working classes, “At any rate if you are to be squeezed out, you had better be squeezed by your own countrymen, than by foreigners.” Will the working classes for ever bear with this? I think not. Those who produce all the wealth and comforts of the rich, will not be satisfied with that poor consolation. They will require more substantial comforts in exchange for substantial produce. But the protectionists say, “After all, we keep up the state of society as it is at present. We ensure to the working man, somehow or other, the employment he wants. We take care that he shall not be turned out of work in consequence of foreign competition.” So be it. Thus, in the best case, the protectionists avow that they are unable to arrive at anything better than the continuation of the status quo. Now the working classes want not the continuation of their actual condition, but a change for the better. A last refuge yet stands open to the protectionist. He will say that he is not at all adverse to social reform in the interior of a country, but that the first thing to ensure their success will be to shut out any derangement which might be caused by foreign competition. “My system,” he says, “is no system of social reform, but if we are to reform society, had we not better do so within our own country, before we talk about reforms in our relations with other countries?” Very specious, indeed, but under this plausible appearance, there is bid a very strange contradiction. The protectionist system, while it gives arms to the capital of a country against the capital of foreign countries, while it strengthens capital against foreigners, believes that this capital, thus armed, thus strengthened, will be weak, impotent, and feeble, when opposed to labour. Why, that would be appealing to the mercy of capital, as if capital, considered as such, could ever be merciful. Why, social reforms are never carried by the weakness of the strong, but always by the strength of the weak. But it is not at all necessary to insist on this point. From the moment the protectionists agree that social reforms do not necessarily follow from, and that they are not part and parcel of their system, but form quite a distinct question, from that moment they abandon the question, which we discuss.

We may, therefore, leave them in order to review the effects of Free Trade upon the condition of the working classes. The problem: What will be the influence of the perfect unfettering of trade upon the situation of the working classes, is very easy to be resolved. It is not even a problem. If there is anything clearly exposed in political economy, it is the fate attending the working classes under the reign of Free Trade. All those laws developed in the classical works on political economy, are strictly true under the supposition only, that trade be delivered from all fetters, that competition be perfectly free, not only within a single country, but upon the whole face of the earth. These laws, which A. Smith, Say, and Ricardo have developed, the laws under which wealth is produced and distributed — these laws grow more true, more exact, then cease to be mere abstractions, in the same measure in which Free Trade is carried out. And the master ‘of the science, when treating of any economical subject, tells us every moment that all their reasonings are founded upon the supposition that all fetters, yet existing, are to be removed from trade. They are quite right in following this method. For they make no arbitrary abstractions, they only remove from their reasoning a series of accidental circumstances. Thus it can justly be said, that the economists — Ricardo and others — know more about society as it will be, than about society as it is. They know more about the future than about the present.

If you wish to read in the book of the future, open Smith, Say, Ricardo. There you will find described, as clearly as possible, the condition which awaits the working man under the reign of perfect Free Trade. Take, for instance, the authority of Ricardo, authority than which there is no better. What is the natural normal price of the labour of, economically speaking, a working man? Ricardo replies, “Wages reduced to their minimum — their lowest level.” Labour is a commodity as well as any other commodity. Now the price of a commodity is determined by the time necessary to produce it. What then is necessary to produce the commodity of labour? Exactly that which is necessary to produce the sum of commodities indispensable to the sustenance and the repairing of the wear and tear of the labourer, to enable him to live and to propagate, somehow or other, his race. We are, however, not to believe that the working man will never be elevated above this lowest level, nor that he never will be depressed below it. No, according to this law, the working classes will be for a time more happy, they will have for a time more than the minimum, but this surplus will be the supplement only for what they will have less than the minimum at another time, the time of industrial stagnation. That is to say, that during a certain space of time, which is always periodical, in which trade passes through the circle of prosperity, overproduction, stagnation, crisis — that, taking the average of what the labourer received more, and what he received less, than the minimum, we shall find that on the whole he will have received neither more or less than the minimum; or, in other words, that the working class, as a class, will have conserved itself, after many miseries, many sufferings, and many corpses left upon the industrial battle field. But what matters, that? The class exists, and not only it exists, but it will have increased. This law, that the lowest level of wages is the natural price of the commodity of labour, will realise itself in the same measure with Ricardo’s supposition that Free Trade will become a reality.

We accept every thing that has been said of the advantages of Free Trade. The powers of production will increase, the tax imposed upon the country by protective duties will disappear, all commodities will be sold at a cheaper price. And what, again, says Ricardo? “That labour being equally a commodity, will equally sell at a cheaper price” — that you will have it for very little money indeed, just as you will have pepper and salt. And then, in the same way as all other laws of political economy will receive an increased force, a surplus of truth, by the realisation of Free Trade — in the same way the law of population, as exposed by Malthus, will under the reign of Free Trade develop itself in as fine dimensions as can possibly be desired. Thus you have to choose: Either you must disavow the whole of political economy as it exists at present, or you must allow that under the freedom of trade the whole severity of the laws of political economy will be applied to the working classes. Is that to say that we are against Free Trade? No, we are for Free Trade, because by Free Trade all economical laws, with their most astounding contradictions, will act upon a larger scale, upon a greater extent of territory, upon the territory of the whole earth; and because from the uniting of all these contradictions into a single group, where they stand face to face, will result the struggle which will itself eventuate in the emancipation of the proletarians.