Karl Marx was supposed to be dead and buried. With the
collapse of the Soviet Union and China’s Great Leap Forward into capitalism,
communism faded into the quaint backdrop of James Bond movies or the deviant
mantra of Kim Jong Un. The class conflict that Marx believed determined the
course of history seemed to melt away in a prosperous era of free trade and
free enterprise. The far-reaching power of globalization, linking the most
remote corners of the planet in lucrative bonds of finance, outsourcing and “borderless”
manufacturing, offered everybody from Silicon Valley tech gurus to Chinese farm
girls ample opportunities to get rich. Asia in the latter decades of the
20th century witnessed perhaps the most remarkable record of poverty
alleviation in human history — all thanks to the very capitalist tools of
trade, entrepreneurship and foreign investment. Capitalism appeared to be
fulfilling its promise — to uplift everyone to new heights of wealth and
welfare.
Or so we thought. With the global economy in a protracted
crisis, and workers around the world burdened by joblessness, debt and stagnant
incomes, Marx’s biting critique of capitalism — that the system is
inherently unjust and self-destructive — cannot be so easily dismissed.
Marx theorized that the capitalist system would inevitably impoverish the
masses as the world’s wealth became concentrated in the hands of a greedy few,
causing economic crises and heightened conflict between the rich and working
classes. “Accumulation of wealth at one pole is at the same time accumulation
of misery, agony of toil, slavery, ignorance, brutality, mental degradation, at
the opposite pole,” Marx wrote.
A growing dossier of evidence suggests that he may have been
right. It is sadly all too easy to find statistics that show the rich are
getting richer while the middle class and poor are not. A September
study from the Economic Policy Institute (EPI) in
Washington noted that the median annual earnings of a full-time, male
worker in the U.S. in 2011, at $48,202, were smaller than in 1973. Between
1983 and 2010, 74% of the gains in wealth in the U.S. went to the richest 5%,
while the bottom 60% suffered a decline, the EPI
calculated. No wonder some have given the
19th century German philosopher a second look. In China, the Marxist
country that turned its back on Marx, Yu Rongjun was inspired by world events
to pen a musical based on Marx’s classic Das Kapital. “You can find
reality matches what is described in the book,” says the playwright.
That’s not to say Marx was entirely correct. His
“dictatorship of the proletariat” didn’t quite work out as planned. But
the consequence of this widening inequality is just what Marx had predicted:
class struggle is back. Workers of the world are growing angrier and demanding
their fair share of the global economy. From the floor of the U.S. Congress to
the streets of Athens to the assembly lines of southern China, political and
economic events are being shaped by escalating tensions between capital and
labor to a degree unseen since the communist revolutions of the
20th century. How this struggle plays out will influence the direction of
global economic policy, the future of the welfare state, political stability in
China, and who governs from Washington to Rome. What would Marx say today?
“Some variation of: ‘I told you so,’” says Richard Wolff, a Marxist economist
at the New School in New York. “The income gap is producing a level of tension
that I have not seen in my lifetime.”
Tensions between economic classes in the U.S. are clearly on
the rise. Society has been perceived as split between the “99%” (the regular
folk, struggling to get by) and the “1%” (the connected and privileged
superrich getting richer every day). In a
Pew Research Center poll released last year,
two-thirds of the respondents believed the U.S. suffered from “strong” or “very
strong” conflict between rich and poor, a significant 19-percentage-point
increase from 2009, ranking it as the No. 1 division in society.
The heightened conflict has dominated American politics. The
partisan battle over how to fix the nation’s budget deficit has been, to a
great degree, a class struggle. Whenever President Barack Obama talks of
raising taxes on the wealthiest Americans to close the budget gap, conservatives
scream he is launching a “class war” against the affluent. Yet the
Republicans are engaged in some class struggle of their own. The GOP’s plan for
fiscal health effectively hoists the burden of adjustment onto the middle and
poorer economic classes through cuts to social services. Obama based a big part
of his re-election campaign on characterizing the Republicans as insensitive to
the working classes. GOP nominee Mitt Romney, the President charged, had only a
“one-point plan” for the U.S. economy — “to make sure that folks at the
top play by a different set of rules.”
Amid the rhetoric, though, there are signs that this new
American classism has shifted the debate over the nation’s economic policy.
Trickle-down economics, which insists that the success of the 1% will benefit
the 99%, has come under heavy scrutiny. David Madland, a director at the
Center for American Progress, a Washington-based think tank, believes that the
2012 presidential campaign has brought about a renewed focus on rebuilding the
middle class, and a search for a different economic agenda to achieve that
goal. “The whole way of thinking about the economy is being turned on its
head,” he says. “I sense a fundamental shift taking place.”
The ferocity of the new class struggle is even more
pronounced in France. Last May, as the pain of the financial crisis and budget
cuts made the rich-poor divide starker to many ordinary citizens, they voted in
the Socialist Party’s François Hollande, who had once proclaimed: “I don’t like
the rich.” He has proved true to his word. Key to his victory was a campaign
pledge to extract more from the wealthy to maintain France’s welfare state. To
avoid the drastic spending cuts other policymakers in Europe have instituted to
close yawning budget deficits, Hollande planned to hike the income tax rate to
as high as 75%. Though that idea got shot down by the country’s Constitutional
Council, Hollande is scheming ways to introduce a similar measure. At the same
time, Hollande has tilted government back toward the common man. He reversed an
unpopular decision by his predecessor to increase France’s retirement age by
lowering it back down to the original 60 for some workers. Many in France want
Hollande to go even further. “Hollande’s tax proposal has to be the first
step in the government acknowledging capitalism in its current form has become
so unfair and dysfunctional it risks imploding without deep reform,” says
Charlotte Boulanger, a development official for NGOs.
His tactics, however, are sparking a backlash from the
capitalist class. Mao Zedong might have insisted that
“political power grows out of the barrel of a gun,” but in a
world where das kapital is more and more mobile, the weapons of
class struggle have changed. Rather than paying out to Hollande, some of
France’s wealthy are moving out — taking badly needed jobs and investment
with them. Jean-Émile Rosenblum, founder of online retailer Pixmania.com, is
setting up both his life and new venture in the U.S., where he feels the
climate is far more hospitable for businessmen. “Increased class conflict is a
normal consequence of any economic crisis, but the political exploitation of
that has been demagogic and discriminatory,” Rosenblum says. “Rather than
relying on (entrepreneurs) to create the companies and jobs we need, France is
hounding them away.”
The rich-poor divide is perhaps most volatile in China.
Ironically, Obama and the newly installed President of Communist China, Xi
Jinping, face the same challenge. Intensifying class struggle is not just a
phenomenon of the slow-growth, debt-ridden industrialized world. Even in
rapidly expanding emerging markets, tension between rich and poor is becoming a
primary concern for policymakers. Contrary to what many disgruntled Americans
and Europeans believe, China has not been a workers’ paradise. The “iron rice
bowl” — the Mao-era practice of guaranteeing workers jobs for life
— faded with Maoism, and during the reform era, workers have had few
rights. Even though wage income in China’s cities is growing substantially, the
rich-poor gap is extremely wide. Another
Pew study revealed that nearly half of the Chinese
surveyed consider the rich-poor divide a very big problem, while 8 out of 10
agreed with the proposition that the “rich just get richer while the poor get
poorer” in China.
Resentment is reaching a boiling point in China’s factory
towns. “People from the outside see our lives as very bountiful, but the real
life in the factory is very different,” says factory worker Peng Ming in the
southern industrial enclave of Shenzhen. Facing long hours, rising costs,
indifferent managers and often late pay, workers are beginning to sound like
true proletariat. “The way the rich get money is through exploiting the
workers,” says Guan Guohau, another Shenzhen factory employee. “Communism is
what we are looking forward to.” Unless the government takes greater action to
improve their welfare, they say, the laborers will become more and more willing
to take action themselves. “Workers will organize more,” Peng predicts. “All the
workers should be united.”
That may already be happening. Tracking the level of labor
unrest in China is difficult, but experts believe it has been on the rise. A
new generation of factory workers — better informed than their parents,
thanks to the Internet — has become more outspoken in its demands for
better wages and working conditions. So far, the government’s response has been
mixed. Policymakers have raised minimum wages to boost incomes, toughened up
labor laws to give workers more protection, and in some cases, allowed them to
strike. But the government still discourages independent worker activism, often
with force. Such tactics have left China’s proletariat distrustful of their
proletarian dictatorship. “The government thinks more about the companies than
us,” says Guan. If Xi doesn’t reform the economy so the ordinary Chinese
benefit more from the nation’s growth, he runs the risk of fueling social
unrest.
Marx would have predicted just such an outcome. As the
proletariat woke to their common class interests, they’d overthrow the unjust
capitalist system and replace it with a new, socialist wonderland. Communists
“openly declare that their ends can be attained only by the forcible overthrow
of all existing social conditions,” Marx wrote. “The proletarians have nothing
to lose but their chains.” There are signs that the world’s laborers are
increasingly impatient with their feeble prospects. Tens of thousands have
taken to the streets of cities like Madrid and Athens, protesting stratospheric
unemployment and the austerity measures that are making matters even worse.
So far, though, Marx’s revolution has yet to materialize.
Workers may have common problems, but they aren’t banding together to resolve
them.
Union membership in the U.S., for example, has
continued to decline through the economic crisis, while the Occupy Wall Street
movement fizzled. Protesters, says Jacques Rancière, an expert in Marxism at
the University of Paris, aren’t aiming to replace capitalism, as Marx had
forecast, but merely to reform it. “We’re not seeing protesting classes call
for an overthrow or destruction of socioeconomic systems in place,” he
explains. “What class conflict is producing today are calls to fix systems so
they become more viable and sustainable for the long run by redistributing the
wealth created.”
Despite such calls, however, current economic policy
continues to fuel class tensions. In China, senior officials have paid lip
service to narrowing the income gap but in practice have dodged the reforms
(fighting corruption, liberalizing the finance sector) that could make that
happen. Debt-burdened governments in Europe have slashed welfare programs even
as joblessness has risen and growth sagged. In most cases, the solution chosen
to repair capitalism has been more capitalism. Policymakers in Rome, Madrid and
Athens are being pressured by bondholders to dismantle protection for workers
and further deregulate domestic markets. Owen Jones, the British author
of Chavs: The Demonization of the Working Class, calls this “a class
war from above.”
There are few to stand in the way. The emergence of a global
labor market has defanged unions throughout the developed world. The political
left, dragged rightward since the free-market onslaught of Margaret Thatcher
and Ronald Reagan, has not devised a credible alternative course. “Virtually
all progressive or leftist parties contributed at some point to the rise and
reach of financial markets, and rolling back of welfare systems in order to
prove they were capable of reform,” Rancière notes. “I’d say the prospects of
Labor or Socialists parties or governments anywhere significantly reconfiguring
— much less turning over — current economic systems to be pretty faint.”
That leaves open a scary possibility: that Marx not only
diagnosed capitalism’s flaws but also the outcome of those flaws. If
policymakers don’t discover new methods of ensuring fair economic opportunity,
the workers of the world may just unite. Marx may yet have his revenge.
— With reporting by Bruce Crumley / Paris; Chengcheng
Jiang / Beijing; Shan-shan Wang / Shenzhen
