Marx’s revenge

I’ve always thought the communists made a big mistake, especially the Soviets. Well, they made a bunch of mistakes in retrospect, not the least of which included the transfer of power. That was never worked out very well, paving the way for allegories like Animal Farm and real-world tyrants like Stalin. But another mistake — purely from an experiemtnal history view mind you — was the exclusion of religion. Suppose, instead of becoming the global face of a perverse form of atheism, Lenin and Marx had embraced those elements of religion that supported their ideology in the same way fundamentalists here and elsewhere have done for capitalism? Suppose, instead a state sponsored link had been established and heavily hyped between the Sermon on the Mount or analogous words found in the Koran, uniting the teachings of Jesus and Mohammed, bearing on the benefits of socialism as seen by down trodden peasants, promising social justice and economic equality for all? It might have been a very different cold war, leading to a very different outcome.

We’ll never know … or will we?

Time Mag Online — The class conflict that Marx believed determined the course of history seemed to melt away in a prosperous era of free trade and free enterprise. … Capitalism appeared to be fulfilling its promise — to uplift everyone to new heights of wealth and welfare.

Or so we thought. With the global economy in a protracted crisis, and workers around the world burdened by joblessness, debt and stagnant incomes, Marx’s biting critique of capitalism — that the system is inherently unjust and self-destructive — cannot be so easily dismissed. Marx theorized that the capitalist system would inevitably impoverish the masses as the world’s wealth became concentrated in the hands of a greedy few … A growing dossier of evidence suggests that he may have been right. It is sadly all too easy to find statistics that show the rich are getting richer. A September study from the Economic Policy Institute (EPI) in Washington noted [...] Between 1983 and 2010, 74% of the gains in wealth in the U.S. went to the richest 5%, while the bottom 60% suffered a decline, the EPI calculated. No wonder some have given the 19th century German philosopher a second look.

For my mother and father’s generation, having grown up in a depression and then winning World War II, there was a time lasting decades where hard work was richly rewarded. My father went to school on the GI Bill, he became a mechanical engineer and joined a growing company in the 1950s that had recently added International to its older name of Business Machines, to become Big Blue aka IBM.

These opportunities themselves were not equally distributed, women didn’t do nearly as well and minorities were systematically excluded in many ways and places. But for millions of rank and file workers, the opportunity was there, they took it, the spoils of corporate conquest were more equitably shared: on an inflation adjusted basis my dad made over 150K in 1972 as a mid level engineer. Even more revealing, my step mother made almost 100K on the same adjusted basis as a tenured secretary. They are both loyal to IBM to this day and I don’t blame them, by the time I was born we had become solidly entrenched in the middle class and, looking back, my childhood was one of suburban privilege as a result. Sharing the prosperity is the path to building a dedicated, permanent workforce in any company, a practice which lasted for decades and paid enormous dividends.

But along came Ronald Reagan and Gordon Gecko, greed became good, real wages began falling, white collar employees were squeezed, hourly workers were decimated as the great outsourcing of US jobs to third world companies began in earnest, benefits began to flow, more and more, to a tiny sliver of pampered CEOs, the billionaire class was created and large estate grew and passed on, the class and loyal acolytes which now sucks the workforce dry under the guise of “share holder value”.

(On shareholders, as a former portfolio manager for a large Wall Street firm I can tell you, shareholders are diverse, far more so that your manager understands if s/he pitches you that tired justification. Some have a conscience, others owuld be happy to chain ten year-olds to workstations if they can get away with it, and there’s everything in between. But one thing shareholders universally dislike are executives making zillion dollar bonuses while the company falters, and especially as the stock lingers or falls. How odd that we never hear about shareholders when the corporate jet is acquired and equipped with golden parachutes during a time of flat to down earnings …)

Those kinds of middle class salaries are for the most part, long gone, a fair day’s wage for a fair day’s work is no more for the vast majority of America’s overworked underpaid workforce. Tax payer resources are expertly driven to the coffers of the worlds’ most profitable corporations, social safety programs are dismantled, regulations relaxed or eliminated, and the end result of this economic shift is now plain to see. The middle class is collapsing, after we signed a trillion dollar loan to bail out the executives that brought it on. In these times, our rickety corrupt rotten system is one more collapse away from a great depression or economic chaos.

The last global collapse in 1929 produced a severe backlash ultimately culminating in the USSR and Nazi Germany. Maybe Marx will have his revenge after all. If so we can only hope the outcome of any future collapse and backlash won’t lead us down the dark path my father and mother lived through, because this time a big all out global war won’t leave much of a workforce, nay much of a civilization, behind to rebuild in a single generation.