Part VIII: What Marx Got Wrong — Robert Paul Wolf

by
Mike Norman
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A number of readers have raised important questions that I need to address, but before turning my attention to that I have decided to finish my exposition. I am sure it is clear that I have vastly more to say than I am putting into this little multipart essay – I mean, I have published two books and a number of lengthy articles on the subject. My purpose here has been simply to highlight my claim that it is possible to bring the literary criticism and the mathematical economics together in a fruitful fashion.

I am fond of saying that Karl Marx was the greatest student of society who ever lived and I genuinely believe that, but I do not think he was a prophet or messenger from God. He was a student of society, which means that he looked at the world around them, studied it as deeply as he could, analyzed it as best he could, got a great many things – important things – right, and of course got a number of things wrong. Today, I want to talk about what he got wrong or more broadly what he failed to foresee, because understanding those failures or inadequacies can help us to understand a good deal about the world in which we live....

I agree with this, although I would add that Marx was deeply educated in almost everything that related to the subject in which he was interested. He read voraciously and, living in London, had the British Library at his disposal. This had a great impacted his work

It is highly doubtful that Marx considered himself to be an oracle any more than does any genuine scientist, since science is tentative on emergent data. Rather, he was consciously following a scientific approach as it was understood in his time. I use the terms "Marxist" and "Marxian" to distinguish between dogmatism and historicism in the approach to understanding Marx.

Moreover, Marx, unlike conventional economists, recognized that social science is historical, hence unlike natural science. He was attempting to explain the "nature" of capitalism as he saw it, and as it turns out he did not foresee the development of capitalism in the direction it took, especially toward finance capitalism (Marxian economist Michael Hudson). What I think he would say is that the development of capitalism would follow the same general rules (admitting of special cases as "exceptions") as long as the mode of production remained the essentially the same. 

Marx was fully conscious of the potential for the mode of production to change, and he expected it to tend in the direction of socialism owing the historical dynamic as he saw in from the historical, sociological and anthropological point of view, a far broader point of view than others had taken. This dynamic is driving the the dialectic of different forces conflicting and change is gradual. 

Feudalism did not just disappear overnight with the rise of capitalism and remnants of feudalism is are still active and incorporated into capitalism, e.g., as land rent. Characteristically, capitalism has absorbed this by treating land as capital, and now folding labor into capital also as "human capital" (see link below). 

Marx did not fail to notice this phenomenon, which he called "labor power." Capital purchases and uses labor power in the market just like any other commodity and extracts surplus value based on organizing labor power in production of commodities by commodities. Workers rent their labor power to capital as a commodity in the labor market.

Capitalism is a hungry beast difficult to satiate since it is based on accumulation, euphemistically termed "growth."As Michael Hudson has pointed out in this regard, capitalism has also integrated (neo-feudal) rent into capitalism with the rise of private debt and financialization, whereas the objective of classical economics and Marx as its culmination, was to eliminate rent as a remnant of feudalism.