By Sean Callaghan

The Revenge of Marx?

On March 25th, Time magazine published an article detailing a resurgent interest in Marxism.  The title: “Marx’s Revenge: How Class Struggle is Shaping the World.”  The basic argument: that the current widening divide between rich and poor since the financial crisis of 2008 has become so apparent in so many countries that Marx’s critique of capitalism might be regaining traction.  Okay.  Not the kind of argument I thought I’d find in a  magazine like Time, but it wasn’t without precedent.  The Guardian posted a similar article in July 2012 entitled, “Why Marxism is on the Rise Again.”  While a comparison of the two would be fascinating, what I find more fascinating is the way the Time‘s article shows us the limit of thinking radical change a la Marx within the current narration of economic crisis.

This limit is most apparent when Michael Schuman, the author of the Time article, quotes French philosopher Jacques Ranciere – arguably one of the most important philosophers still working in the continental tradition today and author of such influential works as Disagreements, The Philosopher and his Poor, Reading Capital, and the Ignorant Schoolmaster.  The passage reads as follows:

“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.””

This passage troubles me in its complete downplay of Ranciere’s radical sensibilities.  The key point for many Marxist philosophers of the past several decades has been a limit of the imagination Ranciere seems to point to in his quote.  The argument goes that despite all the inequalities produced by capitalism we see materializing before our very eyes, we simply cannot think an economic alternative and so are left only with reformist projects to “fix systems so they become more viable.”  The issue isn’t that we should just give in to this limit.  Rather, the call by some Marxists, notably American cultural critic Fredric Jameson, has been to do the impossible: think these alternatives to a capitalist world despite our limits.  Put differently, Jameson noted famously that it has become easier to think the end of the world than think the end of capital, while Slavoj Zizek has shown us proof of this with the proliferation of Apocalypse films that have flooded our theatres over the last decade or so.  The point being, might it not be wiser to think the end of capital as antidote to the end of the world?

Read in this light, Ranciere’s comment is a harsh critique of the protestors and their inability to think through fundamental change.  As we read the article, though, this is not at all apparent.  Rather, Ranciere’s comment is made ambivalent at best.  Either he is bemoaning our current inability to think an alternative to capitalism (Protestors aren’t aiming to replace capitalism, but merely to reform it), or he is promoting a reformist policy whereby those of us engaged in critiques of capital only want to make it better (Protestors aren’t aiming to replace capitalism, but merely to reform it).  Schuman leaves this ambiguity undetermined when he goes on in the next paragraph to state, “despite such calls [for reform], current economic policy continues to fuel class tensions.”  That is, he plays off a tension between protestors who only want to make capitalism better and those politicians and financiers who still refuse to acknowledge the rise of class divisions. By placing these in binary relation, he squeezes out thought on a third alternative: that what we need to resolve our current dilemma is a radical rethinking of our political and economic systems.

The thing is neither Marx, Ranciere nor anyone who has studied Das Kapital with any level of rigor could ever abide by a reformist policy towards capitalism.  The fundamental argument in Das Kapital is that capitalism produces misery as the necessary consequence of its proper functioning.  Ranciere knows this and has argued rigorously for thinking the fundamental “disagreement” that is produced by capitalism between classes.  Schuman himself understands this, and states as much when he writes that Marx’s biting critique of capitalism is one that characterizes  “the system [as] inherently unjust and self-destructive.” So why does he squeeze out this third notion of a necessary radical transformation?

By the end of the article it is made clear: a Marxist revolution is precisely the thing he does not want.  It is the “scary possibility” that we face if we do not put our books in order and get global capitalism working again. The proletariat will rise up, Marx will have his “revenge” if the corruption on Wall Street and the partisanship in Washington are not overcome.  Of course he cannot show us the fundamental nature of Marx’s critique – that it is not actually about class struggle, but rather class struggle is the expression of a fundamental structural or logical kink in the capitalist system – because this would undermine his fundamentally reformist position.

What this article should illustrate to us is a strange trend in populist thought to appropriate formerly revolutionary narratives to promote reformist attitudes towards capitalism.  Further than this, I would argue that the very narration of the latest financial crisis itself is party to this reformation movement.

The 2008 Financial Crisis was not a Capitalist Crisis

Our problem today in thinking a critique of capital is a strange one.  It is no longer the old problem of ideology in which most people refuse to acknowledge there is something wrong with capitalism.  Schuman’s article is testament that people are turning to thinkers like Marx precisely because the flaws in our economic system have become glaringly obvious.  The problem now is that these flaws – expressed in the class divisions, in politicians colluding with big business, in the steady stream of corporate scandals – all work to obfuscate our understanding of the inherent problems with capital.  The financial crisis itself seems to be one more extension of this process of obfuscation.  Or I should say the current narration of the crisis distracts us from the problems inherent to a capitalist system.

As the story goes, Bill Clinton helped push forward the repeal of the Glass-Steagall Act in 1999, an act which was put in place to ensure a strict division between commercial banking and investment banking.  The idea behind the repeal was that this would mobilize whole new levels of growth by affording banks access to the combined mass of money that was sitting idle in commercial bank accounts.  This, combined with the deleveraging of bank debt, allowed investment trading to reach whole new levels of growth.  Then came the subprime mortgage debacle.  The repeal of Glass-Steagall meant investment banks could access an untouched resource: home mortgages.  No one quite knew how to make money off these until some smart trader realized you could bundle up the mortgages with the artful use of mystic derivative powers and then trade them on the market.  Unfortunately, at this same time banks began to issue mortgages to people who really couldn’t afford them by enticing them with the promise of low interest rates.  What many didn’t realize was that the low interest rate they were quoted on their mortgage was only temporary.  When the time limit on their contract came up the bank would refinance at a higher rate that the homeowner couldn’t afford, putting their mortgage underwater, and forcing a foreclosure.   Meanwhile, these “toxic” mortgages were bundled up and traded on a massive scale thanks to a devious shell game amongst the credit rating agencies that ensured the bundles were given a triple A rating.  When more and more people started to default on their mortgages, the market started to freeze up because some of the biggest trading agencies and investment banks had placed huge bets on these bundles.  Crash ensued.

What does this narrative of the crisis tell us?  We shouldn’t have repealed Glass-Steagall.  Banks should have had better regulations in place.  The state should have intervened (but of course Tea-partiers would argue it was the US governments interference with the mortgage market through institutions like Fannie Mae and Freddie Mac that caused the crash; but then who listens to the Tea-party anymore?!).  If only we had better controls in place to govern the market and trading, none of this would have happened.  We just let a bunch of corrupt investment bankers get a hold of the market, and now the rest of us are paying for it through austerity measures.

If this is the narration of the financial crisis of 2008 then we have to accept that this was not a crisis in the capitalist system.  This crisis according to this narration was caused by a few aberrant traders who took advantage of a hole in the system and tried to exploit their advantage to make a bunch of money, then got out before their house of cards fell apart.  Yes, we are all paying for it in the way a real capitalist crisis would shift the burden of the crisis to the middle and lower classes.  Yes, companies sloughed off a mass of workers in much the same way a capitalist crisis attempts to right the clash of rising wages and interest rates with a falling rate of profit by creating a massive surplus labor population to drive down wages.  But the cause was not – according to this narration of the crisis – a matter of the contradictions inherent to capital.  This crisis was a bump in the road.

I’m not saying that I actually believe the crisis of 2008 had nothing to do with capitalism and everything to do with cronyism and corruption.  I’m saying if we abide to the above narration then we are left with two alternatives: either we agree that 2008 was an aberration of capitalism and so was not a capitalist crisis (but possibly a moral or political one), or that this narration itself is an obfuscation of its real roots.

This is where, despite my reservations with various brands of Marxism that have emerged over the last 100+ years, I would still agree with Marx in his diagnosis as to the fundamental contradiction that sits at the heart of the production of capital.  It still holds for us today.  After all, capital is still around.  Lest we forget that all the inequalities of capital were still very much prevalent when capitalism was working at its best before the crisis – wage labor was being shipped out overseas creating a global proletariat, and wars were being fought over the appropriation of resources.  Entire nations were being decimated all in the name of freeing up markets.

To think this differently, let’s say we resolve all the problems we are faced with today.  The EU pulls its nations out of debt, the US economy surges as unemployment rates drop.  What then?  We are still left with the problem of capital growth at the expense of imminent ecological collapse.  We are still left with a system that privileges individual antagonism over social cooperation.  We are still left with a class of owners that is antagonistic to paying fair wages to its workers.  We are still left with all the problems of capital, but they will have been further obscured by the elation of a temporary reprieve.

Don’t get me wrong.  I would really like to believe that capitalism can be fixed.  I want to believe that all it takes is a little tweak of some magic wand, and all the problems of our current economic system will disappear.  But it hasn’t happened in hundreds of years. This fact reminds me of an episode of the Simpsons in which Homer keeps putting his hand on a hot burner and screaming in pain.  Over and over again he repeats his idiocy.   We laugh because his refusal to learn is absurd.  No one would be that stupid.  And yet here we are.  Again.  Our adherence to reformist ideals in relation to capital mimics the Homer problem.  Except we think we’re smarter because we get someone else to put our hand on the burner, or maybe we put a paper bag on our hand to soften the burn.  At what point do we say to ourselves, “hey, maybe the burner itself is the problem”?  When do we acknowledge that capitalism can’t be fixed so we can put the past behind us, put our reformisms to rest, and begin doing the impossible: thinking radically new ways of organizing our economy, our politics, our very shared existence?

If not now, when?

Sean Callaghan earned his Ph.D. in Modern Japanese History and Literature from the University of Toronto. He is a published playwright and is currently working on a YA novel.