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Marx: The Economist's Economist

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Tags World HistoryAustrian Economics OverviewOther Schools of Thought

With the general election campaigns heating up in the UK, the two major parties are playing a game of duelling manifestos. The Conservatives are upholding a classic interventionist line of fixing energy prices and increasing the national living wage, but Labour has brought to the table a unique potpourri of disastrous ideas. Among other things, they propose to renationalize the British railways and the Post Office, and scrap university tuition fees. More tragically, in their desire to appear intellectually-minded, they’ve also associated themselves with great thinkers — their choice is Karl Marx, whom Jeremy Corbyn, the Labour Party leader, praised as “a great economist” alongside Smith and Ricardo.

His remark was met with a mixture of ridicule and indifference by the public and the press. Tabloids, searching for sensationalism, discussed in passing the crimes of communism. But the more respectable press, such as the Economist, offered a defense of Marx as a thinker and prophet of modern times.

The column in question made use of every possible Marxist fallacy still alive today, such as the class struggle, the exploitation of workers by the capitalists, and the immiseration of the poor under a capitalist system. Their examples were muddled too, in good Marxist fashion: to explain why capitalism is unfair, they pointed to the salaries and influence of retired politicians such as Tony Blair and George Osbourne. And, perhaps unsurprisingly, they blamed the economic crisis solely on unregulated financial markets.1 The Economist’s concluding advice was that, even in 2017, Marx still has a thing or two to teach us about capitalism. This runs against the advice they gave no more than five months ago to abandon the “myth of Marx,” arguing that Marx was out of step with the theoretical developments of 19th century economics, and that his writings were dense and nonsensical.

More importantly, the Economist fails to see that reasonable statements Marx might have made were borrowed from classical economics. His original thinking, on the other hand, amounted to nothing more than equivocal statements, half-baked arguments, and crude claims unsupported by any empirical facts. According to Mises (2001, 79), since Marx’s death,

we continue to await [the class struggle’s] scientific definition and delineation. No less vague are the concepts of class interests, class condition, and class war, and the ideas on the relationship between conditions, class interests, and class ideology.

Over the last century and a half, pretty much every word Marx wrote has been discredited (examples can be found here, here and here), and the tragedy of Marxism in practice thoroughly documented (here, here, and here). But these days, such critiques are met with much more scorn than any nonsense Marx ever said. As are many serious objections brought against the Conservative and Labour Party manifestos. It is disheartening to witness not only how such bad ideas never fully die, but how they come back with a vengeance at perhaps the most vulnerable times in human history.

Combating them, therefore, has become a task for the bold and the perseverant. Mises (2000, 49) explained the importance of this continued fight as follows:

It is a thankless job indeed to express such radical and "subversive" opinions […] But it is not the duty of an economist to be fashionable and popular; he has to be right. Those timid souls who fear challenging spurious doctrines and superstitions because they have the support of influential circles will never improve conditions.

  • 1. For an analysis of the effects of government policies on financial markets, and their role in the financial crisis, see Guido Hűlsmann (2013 and 2014).
Note: The views expressed on Mises.org are not necessarily those of the Mises Institute.
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