Marx’s face featured on the cover of Time Magazine in Europe over the headline “What Would Marx Think?” “We’re All Socialists Now” proclaims the cover of Newsweek. Right-wing politicians and pundits warn of the coming of American socialism with Obama’s stimulus package. What is going on here?

Just 20 years ago, with the collapse of the Soviet Union the ideas of socialism and Marxism were dismissed as dead. Capitalism was seemingly triumphant worldwide as corporate politicians and media spokespersons proclaimed the world had reached the “end of history.”

Yet recently, socialism has re-entered the popular dialogue. In large part, this has come from the right wing, who have attempted to label any sort of government intervention into the economy or any move toward a welfare state as “socialist.”

Newsweek, for instance, implies that much of Europe is socialist, owing to the existence of a stronger welfare state and more government regulations than in the U.S. However, this is far from the truth. Recent months have seen mass protests and strikes by workers and youth all over Europe as their pro-corporate, capitalist governments attempt to make workers pay for the global economic crisis.

In reality, the measures being employed by governments throughout the world today, including nationalizing banks and implementing stimulus packages, are not socialist. They are Keynesian measures designed to save the capitalist system from a devastating economic crash like the 1930s and to avoid deep political and social upheavals that could threaten the rule of big business.

Searching for an Alternative
Yet there has also been the beginning of a re-emergence of genuine socialist and Marxist ideas. Sales of Marx’s works are skyrocketing, with Amazon reporting a 700% increase in sales of the Communist Manifesto since the banking collapse (Times (UK), 11/9/08).

This renewed interest comes as workers and youth search for explanations of and an alternative to the misery caused by the global recession. Illusions that capitalism can provide a decent future are fast being broken down.

As Time writes, “Nobody younger than 80 has experienced such a rapid decline in global confidence and economic activity. Markets have failed, and in so doing they have destroyed the conventional wisdom about how to run an efficient economy. It’s as if an intellectual fog has descended, and the global positioning system has broken down, leaving the world to grope its way out as best it can.”

According to former British Prime Minister Tony Blair, “Ask the experts what to do, and the most honest reply is ‘I don’t know.’” Even Alan Greenspan, the former head of the U.S. Federal Reserve, once commonly referred to as the “maestro,” admitted: “I still do not fully understand why [the crisis] happened.” Trapped by the logic of their for-profit system, they can find no answers.

As Marx put it in the Communist Manifesto, “Modern bourgeois society … [having] conjured up such gigantic means of production and of exchange, is like the sorcerer who is no longer able to control the powers of the nether world whom he has called up by his spells.”

The market system has clearly failed, and the capitalists have no one to blame but themselves. The corporate elites have had free rein over the entire past period, with the collapse of Stalinism, the retreat of the labor movement, and the neo-liberal offensive of deregulation, privatization, free trade, and corporate globalization.

Yet rather than ushering in an era of peace and prosperity, this has resulted in the biggest economic crash since the 1930s. The massive government interventions, including stimulus packages, bailouts, and nationalizations, are a clear admission the market is incapable of overcoming this crisis. If left to its own mechanisms – if there wasn’t enormous state intervention – we would already have seen another 1929-type crash.

Capitalism’s Contradictions
The article in Time quotes Archbishop Reinhard Marx (who recently wrote his own Das Kapital) writing a letter to his revolutionary namesake: “[Capitalism] lasted longer than you expected back in the 19th Century, but could it be that capitalism is just an episode of history that will end at some point because the system will collapse as a result of its internal contradictions?”

Marx explained how these internal contradictions, inherent to capitalism, lead to periodic crises. At root is the contradiction between the private ownership of capital – the banks, workplaces, factories, etc. – by a tiny mega-rich minority, and the socialized nature of production in which millions toil collectively to produce goods and services.

Rather than democratically planning how to most efficiently allocate and use the resources of society, under capitalism individual companies are locked in dog-eat-dog competition with each other to maximize profits and secure market share.

To make profits, bosses pay their workers only a fraction of the value they produce. This leaves workers unable to buy back all the goods they have made, leading to crises rooted in overproduction (or overcapacity) and the anarchy of the capitalist “free” market.

These crises can only be solved on a capitalist basis by, as Marx wrote, the “enforced destruction of a mass of productive forces … the conquest of new markets, and by the more thorough exploitation of the old ones.” This is what lies behind the plant closings and layoffs globally.

There is also a fundamental contradiction between capitalism’s development of a world market and the constraints of the nation-state, which corporations rely on to defend their interests.

The globalized economy of recent years gives a glimpse, though in a distorted manner, of the enormous economic potential if the outmoded barrier of the nation-state was removed. Yet today the economic crisis has led to growing moves toward protectionism in many countries and an increasing competition to secure markets.

Under socialism, this contradiction would be overcome in favor of international socialist cooperation and planning, with the world’s resources used to raise the living standards of workers and the poor throughout the world rather than enriching the global financiers and CEOs.

Governments around the world are now scrambling to find measures to escape this crisis and avoid social upheavals. As German Chancellor Angela Merkel warned, if governments “are not in a position to show that we can create a social order for the world in which such crises do not take place, then we’ll face stronger questions as to whether this is really the right economic system.”

But no amount of tinkering with the capitalist system can prevent these crises from breaking out. How many times have we been told the 1930s can “never” happen again due to new laws and regulations? Yet we now face the deepest crisis since the 1930s.

End This Crisis-Ridden System
Mass working-class action is necessary to replace an outmoded, inefficient, and wasteful system, capitalism, with a democratic, socialist, planned economy.

By full involvement of working- and middle-class people through popular control and management of industry and society, we can begin the rational organization and planning of the resources of society for all and not, as is the case now, to satisfy the discredited handful of greedy bankers and capitalists.

To do this will require building a massive movement of workers and youth to challenge the system and fight for a socialist alternative. Already, we have seen mass demonstrations in many countries across the world, including a strike by 2 million French workers in January as well as a series of demonstrations in Iceland, the country hardest hit by the economic crisis so far, that brought down the government.

There has also been a huge radicalization in Greece and elsewhere, and in time revolutionary storms will result from this crisis.

However, there is no “final crisis of capitalism” unless the working class changes society. Big business will always seek a way out through attacks on the working class, and their system will recover unless power is taken out of their hands.

The working class will be forced to resist in order to defend its living standards and survive the crisis brought on by capitalism. These struggles, along with the conscious intervention by socialists and Marxists, will lead increasing numbers of workers and youth to explore the ideas of genuine Marxism (not the perversion found in the Stalinist states) and will find in them a real explanation of the systemic causes of the current crisis.

As Archbishop Marx writes to the revolutionary Karl Marx, “There’s a question that won’t leave me in peace: At the end of the 20th Century, when the capitalist West defeated the communist East in the battle between systems, were we too quick to dismiss you and your economic theories?” (Time, 2/4/09)

Marx, however, did not just make economic predictions about capitalism but drew bold, active, socialist conclusions about the need to fight for a revolutionary transformation of society. As Marx wrote, “The philosophers have only interpreted the world, in various ways. The point, however, is to change it.”


In Their Own Words

from the Communist Manifesto by Karl Marx and Frederick Engels

“The commercial crises… by their periodical return, put the existence of the entire bourgeois society on its trial, each time more threateningly. In these crises, a great part, not only of the existing products, but also of the previously created productive forces, is periodically destroyed. In these crises, there breaks out an epidemic that, in all earlier epochs, would have seemed an absurdity – the epidemic of over-production.”

“Constant revolutionizing of production, uninterrupted disturbance of all social conditions, everlasting uncertainty and agitation distinguish the bourgeois epoch from all earlier ones… All fixed, fast-frozen relations, with their train of ancient and venerable prejudices and opinions, are swept away, all new-formed ones become antiquated before they can ossify… The need of a constantly expanding market for its products chases the bourgeoisie over the whole surface of the globe.”

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