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I am surprised most socialists - particularly Marxist socilalists whether they be from China or the US do not recognize the key point of Marx's prediction that Capital would continue to Centralize and Accumulate over time. |
Marx predicted this over a century ago, and his prediction was based on the mechanism of how Constant Capital (machinery and technology) displaces Variable Capital (living labor. ) That is, as technology and machinery make the economy more efficient - the worker becomes increasingly expendable and relatively less valuable.
To take a concrete example, let us say we make a machine that can do exactly what a doctor can do for 40,000 dollars a year. That means, to remain competitive in a free market economy, a doctor has to work for at most 40,000 dollars per year. The value of the doctor in US dollars has decreased by almost 140,000 per year. And as the technology improves, his value will drop even faster.
Now people will argue "but you need workers to make and maintain the machines!" but the problem with this is it does not make economic sense. If I was a company, and a machine replaced 2 workers, but required 5 workers to maintain it, why would I use that machine? Even if demand increased, why wouldn't I just hire 2 more workers, instead of buying the machine AND paying 5 more workers to maintain it? (this is assuming similar wages of course, you can alter the variables so that the 5 workers are cheaper than 2 very highly paid workers, but ultimately that is quibbling as we are talking about labor-power and not just the number of workers. ) Likewise, if it takes 5 workers to make every machine unit, and it only replaces 2 workers, why use it if the cost of production (which includes labor) transfers to the machine?
In other words - to be useful for a company, the machine has to save the company money. Having more labor go into a machine than the machine replaces will almost never save the company money. There could be a few exceptions, such as a liquidation sale, but those do not hold in the long run. It is like gravity, sometimes things might go up for longer periods of time, but ultimately everything falls back to the Earth, or in general, that is what happens to all objects.
To take some extreme, but real examples, we can see what happened to horses and oxen as machines wholly replaced almost all of their practical functions. If we consider how robotics can effect the economy, it is easy to imagine all human labor becoming 100% expendable, especially if we start putting AI in the equation.
Adam Smith was, for the most part thus right - if we allow a free market, the wealth will spread given everyone has an equal amount of labor power, more or less, at their disposal. He was writing before the Industrial Revolution, and given his premise he was right - it was unlikely a blacksmith would ever produce a hundred or thousand times more than another, or a farmer, produce 1000 times more crops, without paid workers or slaves (and Smith saw slavery as inefficient, which in many ways it was. ) However Industry and modern technology changes all this, with a factory, it is possible for the owner to produce 1000 times or more what a bunch of small shops could produce, and he could hire workers, for what a small workshop could, for pennies on the dollar.
I don't understand why Marxists do not emphasize this point enough. Many of their arguments sound utopian and distracted - Socialism is moral, socialism is just, socialism is fair, socialism is a nicer system.
Maybe it is, and maybe it isn't. But that's not what makes Marxism a scientific theory. Science is a matter of facts and hypothesis testing based on practices such as experimentation and peer review, and principles like parsimony and falsification. The main hypothesis that distinguishes Marxism from other utopian Socialist idea is the Centralization Hypothesis. Without that, the whole system falls apart.