Karl Marx: Conditions Necessary for the Existence of Capitalism

Many of Marx's observations and discoveries are quite meaningful, highly relevant, and quite applicable for explaining specific features and strengths and weaknesses of a capitalist market economy. Marx wrote his analyses during the nineteenth century when capitalism was near full development and the industrial revolution war already started. According to Marx, there were at least three conditions necessary for capitalism to exist and also a few major aspects that accompanied capitalism's development.

First, capitalism was the only economic form where the majority of the products were produced as commodities (note that although this concept was briefly discussed in the last section, a more detailed version will be presented here). A commodity was a useful object or thing that was produced, not for immediate consumption by the producer, but for the specific purpose of exchange with other consumers using a medium of exchange such as money. As the majority of products were produced to make commodities in this manner, satisfaction of needs was no longer important nor the aim of the capitalist. Production now took on the sole objective to produce items for the purpose of exchange and for the subsequent acquisition of profit.

One of the main concerns Marx had of capitalism was that it tended to undermine the various aspects of human development by essentially encouraging people to adopt priorities and values that were perhaps incongruent with the same. Rather than focus of human well being and development, capitalism tended to position the act of accumulation of profit as its top priority. As products became commodities and were valued in terms of money instead of their qualitative aspects, products were practically now given power to dictate how people were going to relate with one another. Relations between people now became very material, and people were treated as things. Conversely, relations between things took on a somewhat social and life-like character, and things were given a sort of controlling power over human life and their daily affairs. In other words, things became what Marx called a "fetish" for man. With a capitalist mindset, then, a work of art it was now valued merely on potential monetary worth rather than receiving appraises and admiration for artistic and creative qualities.

Second, capitalism was an economic form where both a worker and his product were pulled away, freed, or as Marx put it, "alienated" from personal creative and, in most cases, intrinsically meaningful work. For this necessary condition of capitalism to occur, property relations or rights had to first change. In other words, capitalism could not exist unless ownership of the means of production (e.g. raw materials, tools, machines, factories, buildings, etceteras) was taken away from private or individual producers (i.e. common citizens or workers) and given to only a few hands (i.e. capitalists). As this was done, the common worker or laborer was not only freed from owning means of production, but he also became free and was also compelled, for the sheer sake of survival, to sell his labor capacity to one who did own means of production, i.e. to a capitalist.

There are a couple of adverse consequences associated with realization of this second condition. For one, Marx suggested that when a worker no longer retains proprietorship of the products of his labor, he became alienated from both himself and from his product because he no longer had choice of the product's outcome. With capitalism, products were solely produced for the capitalist, and only the capitalist decided what was to be done with the product. In other words, not only did the worker become alienated from himself and the work of his own hands, but now he and his labor capacity virtually became commodities as well.

The capitalist form of economic system has clearly shown that if there was not some existing mechanism that distributed ownership of property in a manner conducive to some sort of relative equality, then inequality inevitably resulted. As pointed out by Marx, since the onset of capitalism, capitalists (i.e. owners of the means of production) have claimed it a right to have sole ownership of the products and any surplus (including profits) created from employing what they claim as their means of production and their wage-laborers. Inequality therefore happened, at least in part, because a capitalistic society was conditioned to accept it as a norm for means of production to be individually instead of communally owned and to grant owners a right to not have to share production surplus with others. What Marx envisioned and dreamed of for a future society was one that was comprised of "associated producers" where the means of production would be held in common and the produce shared equally by all of the producers. With this latter type of property arrangement, a situation of relative equality could eventually arise.

There are many that believe that Marx advocated abolition of ownership of all private property. Unfortunately, this is a mistake. When Marx discussed private property, he did not mean property meant for individual ownership and personal consumption; he was only talking about the means of production such as the land, tools, machines, and buildings, etceteras, that were used in production.

It is very interesting to note that those who have attempted to defend capitalism as a just economic system have commonly pointed to the democratic aspects of the actual exchange process. However, from his analysis of property relations, Marx uncovered a very contradictory point that suggested that this democratic and voluntary aspect of capitalism occurred only in the "sphere of circulation" in capitalism. According to Marx, in the capitalist sphere of production, this so-called equality of exchange was no longer really there. Rather than produce for their own selves or for society, with capitalism, workers produced strictly for the capitalist and his own personal gains. Once again, this inequality in the production process existed due to the property relations that gave the owners of the means of production absolute control and proprietorship over the produce.

According to Marx, the third condition necessary for capitalism was that a .capitalist must acquire sufficient or at least a minimum amount of capital to get the production process going. Here, capital, of course, includes both material and human forms. Interestingly, history has shown that, even with abundant amounts of material capital present, without a huge supply of so-called wage-laborers or freed workers that have labor capacities to sell, capitalism would not develop. Capitalism relied heavily upon individual workers who depended on the system for their daily subsistence and who must therefore sell their capacities to those who owned means of production in order to provide for themselves and families. Fortunately for capitalism, several historical events during capitalism's development resulted in providing necessary human capital. Marx observed that over several decades, the majority of independent farmers, domestic producers, and various craftsmen from the feudal society were eventually expropriated from their land, separated from their means of production, and practically thrown into the new capitalist system.

With regard to material capital, Marx dedicated a substantial amount of his writings to explain the effects of the increasing employment of machines and subsequent industrialization of the economy. In capitalism, competition and the incessant quest for the accumulation of profit drove participants to discover improved ways to increase productivity for the purpose of cheapening products or making more goods in less time. On one hand, Marx recognized this particular aspect of capitalism as a strength and benefit for a society because he saw how it could potentially provide more material wealth for everybody and improve the overall quality of life. Marx firmly believed that this particular strength of capitalism was very important and highly essential for the purpose of preparing material conditions needed for a future higher order society that would eventually replace capitalism.

On the other hand, Marx pointed out that due to the competitive nature of capitalism and its aim for profit, new technology was not being utilized to lighten the load and burdens of the laborer and to reduce the length of his working day. In fact, as soon as the economic system became industrialized and more machines were employed, conditions for the worker including women and children became worse. Hence, work became increasingly hectic, complex, and intense, many opportunities for self-determination faded, and the quality of life for most people actually declined.

A fourth major aspect (not necessarily a required condition) accompanying the development of capitalism that Marx observed was the social organization of labor and its associated dehumanizing effects. For example, several chapters of Capital Volume I discussed quite extensively the development of cooperation, division of labor, and the social interconnectedness of industrial operations and markets. For Marx, the development of division of labor was not necessarily a bad thing, but he did express considerable concern when divisions of labor practices were carried out to an extreme. On one hand, division of labor benefited society by increasing productivity, improving efficiency, and by allowing more goods to be produced. On the other hand, Marx worried about the dehumanizing effects that accompanied developments of the division of labor, particularly when an individual was required to perform single, repetitive tasks that robbed a worker of social intercourse, physical health, and intellectual development. Avoidance of this problem suggested that in an ideal society all routine or repetitive operations or tasks would be, as much as possible, automated so that the majority of work content is as intellectually stimulating, creative, and intrinsically meaningful as desired by each person.
A fifth aspect, but again, not necessarily a necessary condition for capitalism, was the establishment and preservation of what Marx called a "relative surplus population" or reserve pool of the unemployed. For capitalism, to have a certain amount of unemployed workers was good and very important so that there was always fresh labor available to draw upon as new productions were put into operation. More importantly, a certain amount of an unemployed force was good for the capitalist because it compelled a worker to work harder and longer. It also acted, as much as possible, as a tool to help keep wages down.

As implied here by Marx, one of the main weaknesses of capitalism was that there does not exist a built in mechanism guaranteeing a displaced worker immediate placement into another job and an uninterrupted source of income or means for providing for one's livelihood. Nevertheless, for capitalism this is acceptable because, with capitalism, certain minimum amount of unemployed laborers must always be available in order to provide some sort of stability to the system. An ideal system would probably eliminate such problems and attempt to minimize the unnecessary insecurities and inconveniences brought upon people when they are displaced from jobs.