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Red Theory: The revolutionary significance of Marx’s critique of capitalism

By J. Sykes |
July 10, 2022
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Thanks to Marxism, we know that ideological superstructure of society arises from and supports the material, economic base of society. What we think is shaped primarily by our practical activity in production, class struggle and scientific experiment. Furthermore, Marx was fundamentally a revolutionary organizer, interested in helping the working class to understand and overthrow its exploitation. This is why Marx devoted the bulk of his theoretical work to an analysis of political economy.

Marx’s historical materialism explains how any given mode of production arises historically, based on dialectical and material processes. His critique of political economy examines the inner workings of capitalism itself. It explains where capital comes from and how exploitation functions, as well as why this exploitation is fundamental to what capitalism is. It also explains how the contradictions inherent in capitalism lead to crisis and social revolution.

In this article and the following articles, we are going to look more closely at Marx’s critique of capitalist political economy. But first, we need to understand what political economy is. The Soviet Political Economy textbook from 1954 gives us a good definition. It says, “political economy is the science of the development of the social productive, i.e., economic, relations between men.” If we want to frame it in the terms of historical materialism, we might say that Marx’s critique of political economy is the study of the capitalist mode of production, especially capitalist relations of production. In this way it is very different from academic, bourgeois economics, which seeks instead to justify and manage capitalist profit.

Marxist-Leninist political-economic theory explains the stages of capitalism’s development, the law of value, the role of commodity production, surplus value as the secret of capitalist exploitation, and how inevitable overproduction leads to crisis as a feature of capitalism itself. It also explains how monopoly capitalism developed from early competitive capitalism, and how this inevitably leads to national oppression and imperialist war.

Bourgeois economists likewise insist that capitalist relations of production are “natural,” in a metaphysical sense. That is, they are unchanging and fixed. Not only the way things are, but the way things should be. This is how bourgeois political economy before Marx obscured the true nature of capitalism. In The Poverty of Philosophy, Marx writes, “When the economists say that present-day relations – the relations of bourgeois production – are natural, they imply that these are the relations in which wealth is created and productive forces developed in conformity with the laws of nature. These relations, therefore, are themselves natural laws independent of the influence of time. They are eternal laws that must always govern society.” But Marx shows that this is not the case. Capitalism occupies a point in history. It arises from what came before it and it has an end that will necessarily arise from the contradictions within it.

In his critique of political economy, Marx shows how capitalism has developed, how the capitalists generate profit at the expense of the working class, and how the contradictions inherent in this process lead to capitalist crisis.

For Marx, the key to understanding capitalist relations of production is understanding surplus value. This is the trick that capitalists play on the workers, and it is the source of their profit. Lenin explains it like this: “The worker spends one part of the day covering the cost of maintaining himself and his family (wages), while the other part of the day he works without remuneration, creating for the capitalist surplus value, the source of profit, the source of the wealth of the capitalist class.”

We’ll get into surplus value in detail later. But this is a crucial point to understand what Marx was getting at. All value comes from the labor that the workers perform. The capitalist contributes nothing. The only reason they are able to profit from the process is because of an unequal power relationship masked as an equal exchange. The capitalist dictates the terms of employment, because the worker must sell their labor to survive.

Meanwhile, the capitalists are driven by competition amongst themselves to keep their profits high and costs low, meaning they must keep wages down while pushing production levels higher and higher. Those capitalists who fail to do this sufficiently will be swallowed up by those who are ruthless enough to succeed. The formation of capitalist monopolies only pushes this to further extremes. This means that there is a contradiction between capitalist and worker that is fundamentally antagonistic. The capitalist profits at the workers’ expense, and for the workers to get any more than a subsistence level wage, they must organize and fight for it.

Next, we’ll look at this historical emergence of capitalism out of mercantilism and the role of what Marx called “primitive accumulation” in jump-starting the capitalist mode of production. Then, in the articles that follow we will carefully break capitalism down, point by point. We will examine what commodities are, and why Marx thought they were fundamental to understanding the way capitalism functions. We’ll look at value in all of its different forms, and we’ll examine how it is determined. Then we will break down surplus value and overproduction, before getting into the nuts and bolts of monopoly capitalism, or imperialism.