[OPE] "The Return of Karl Marx" _The New Yorker_ (abstract)

From: Gerald Levy <jerry_levy@verizon.net>
Date: Sat Nov 14 2009 - 21:11:22 EST

by John Cassidy
October 20, 1997
John Cassidy, The Next Thinker, "THE RETURN OF KARL MARX," The New Yorker,
October 20, 1997, p. 248

Karl ABSTRACT: THE NEXT THINKER about Karl Marx's influence as an
economist... Writer was talking with a college friend who now worked at a
big Wall Street investment bank... To my surprise, he brought up Karl Marx.
"The longer I spend on Wall Street, the more convinced I am that Marx was
right," he said. I assumed he was joking. "There is a Nobel Prize waiting
for the economist who resurrects Marx and puts it all together in a coherent
model," he continued, quite seriously. "I am absolutely convinced that
Marx's approach is the best way to look at capitalism." I didn't hide my
astonishment. We had both studied economics during the early eighties at
Oxford, where most of our teachers agreed with Keynes that Marx's economic
theories were "complicated hocus-pocus" and Communism was "an insult to our
intelligence." The prevailing attitude among bright students of our
generation was that Marx's arguments were fit only for polytechnic lecturers
and aspiring Labour Party politicians... More than fifty years ago, Edmund
Wilson noted that much of Marx's prose "hypnotizes the reader with its
paradoxes and eventually puts him to sleep." The passing decades have not
made the going any easier. Marx was ludicrously prolix... The writer
gradually began to understand what his friend meant. In many ways, Marx's
legacy has been obscured by the failure of Communism, which wasn't his
primary interest. In fact, he had little to say about how a socialist
society should operate, and what he did write, about the withering away of
the state and so on, wasn't very helpful--something Lenin and his comrades
quickly discovered after seizing power... When Marx wasn't driving the
reader to distraction, he wrote riveting passages about globalization,
inequality, political corruption, monopolization, technical progress, the
decline of high culture, and the enervating nature of modern
existence--issues that economists are now confronting anew... Marx was born
in 1818, and died in 1883... Marx wasn't a crude reductionist, but he did
believe that the way in which society organized production ultimately shaped
people's attitudes and beliefs. Capitalism, for example, made human beings
subjugate themselves to base avarice... "Globalization" is the buzzword of
the late twentieth century, on the lips of everybody from Jiang Zemin to
Tony Blair, but Marx predicted most of its ramifications a hundred and fifty
years ago... Globalization is set to become the biggest political issue of
the next century... In one way, Marx's efforts were a failure. His
mathematical model of the economy, which depended on the idea that labor is
the source of all value, was riven with internal inconsistencies and is
rarely studied these days.... One important lesson Marx taught is that
capitalism tends toward monopoly--an observation that was far from obvious
in his day--giving rise to a need for strong regulation.... Likewise
endogenous-growth theory models are undoubtedly Marxist in spirit, since
their main aim is to demonstrate how technical progress emerges from the
competitive process, and not from Heaven, as in the neoclassical model.
Describes Marx's "theory of immiseration" which says that profits would
increase faster than wages, so that workers would become poorer relative to
capitalists over time, and this is what happened during the last two
decades. Inflation-adjusted wages are still below their 1973 levels, but
profits have soared. ... A key question for the future, the answer to which
will determine the fate of the soaring slock market and much else, is
whether capital can hold on to its recent gains. Writer visits Highgate
Cemetery, where he visited Marx's grave... Perhaps me most enduring element
of Marx's work is his discussion of where power lies in a capitalist
society. This is a subject that economists, with their fixation on consumer
choice, have neglected for decades, but recently a few of them have returned
to Marx's idea that the circumstances in which people are forced to make
choices are often just as important as the choices... Marx, of course,
delighted in declaring that politicians merely carry water for their
corporate paymasters... The sight of a President granting shady businessmen
access to the White House in return for campaign contributions would have
shocked him not at all. Despite his errors, he was a man for whom our
economic system held few surprises. His books will be worth reading as long
as capitalism endures.

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