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In honor of Karl Marx’s two-hundredth birthday, it is worth reexamining one of his fundamental assumptions, that power cannot be sundered from capital. We now know this to be false.
The idea that the two always go together reflects what I call the “ideology of capitalism”: that the “free market” functions best when left to itself, and incumbent wealth and power—originating as they do in that market—ought not to be challenged in the political realm. In Marx’s time, this ideology held down the rising threat of the left and kept the capitalist system intact and on the ascent.
The ideology of capitalism can be discredited while stopping short of the violence that would inevitably follow from overthrowing capitalism itself.
The disjunction between power and ownership of capital was something Marx never observed in his lifetime, but we now know that incumbent wealth and power can be overthrown, subverted, democratized, and tamed. The ideology of capitalism can be discredited while stopping short of the violence that would inevitably follow from overthrowing capitalism itself—an overthrow that, in the end, would likely make things worse for the powerless.
We have done it before, after all. Popular opinion once massed behind a program of progressive income and wealth taxation; public provision of health, education, and infrastructure; social insurance and labor protections, including the right of workers to bargain collectively; a macroeconomic policy aimed at full employment; regulatory restructuring of corporate power in favor of a wide set of stakeholders; and limits on the mobility of capital relative to the inherent immobility of labor, which, comprised of human beings, subsists on social relationships.
A strand of left historiography interpreted the New Deal, which made all of these things into federal policy, as a grand sell-out, in which radical activism was taken off the table in exchange for the embrace by capitalists (and their allies in government) of a moderate and mild critique and the bureaucratizing of its influence. Having gained a foothold in the establishment, liberals unleashed turned the powers of the state against the left as a way of proving their loyalty to the capitalist establishment.
In this story, which is popular among many of today’s Marx admirers, the liberals’ about-face ultimately sowed the seeds of their own destruction. Liberals did the dirty work of systematically eliminating the threat that forced capitalism to the table, but they still left capitalism intact, all but eliminating the left from any position of influence and power in U.S. public life. After a mere few decades of Supreme Court rulings, regressive tax cuts, and the convenient over-interpretation of the fall of the Berlin Wall as the “end of history,” the New Deal ended up rolled up and dumped in an alley.
It was not the Red Scare and the fecklessness of the establishment that undermined the New Deal, but rather its irreconcilability with white supremacy.
This liberal-sellout story is compelling, but it misses the real story, which is both more horrible, and also, in a way, more hopeful. It was not the Red Scare and the fecklessness of the establishment that undermined the New Deal, but rather its irreconcilability with white supremacy. The New Deal was an exercise in democracy. And while the political compromise that set it up systematically excluded people of color from its protections and privileges, its essentially egalitarian character, and the egalitarianism inherent in the political coalition that was its only hope of sustenance, brought about the reckoning with the Jim Crow system and with the equally systematic de facto segregation in the North.
Civil rights was a movement to integrate the social democracy created by the New Deal. But instead of allowing that to happen, we burned that social democracy to the ground. The organs of reaction took advantage of the opportunity to divide a movement for mass democracy by presenting universalist claims as zero-sum. Thus they reconquered the territory they lost during the middle third of the twentieth century, systematically eliminating the state’s capacity to act as a countervailing force to private power. With the help of a liberal establishment which interpreted any power attained by those who did not look like them as a grave threat, and so developed an arcane set of justifications for insulating the true organs of policy from democratic influence, conservatism could claw its way back.
Recent commentators and amateur historians have taken this retrenchment to reflect the hopeless ineluctability of race in U.S. history, but it can be interpreted otherwise: as a manual for how to pry power out of the hands of capitalism’s ideologues. They know that their privilege depends on never facing the threat of multiracial, multiethnic, inclusive egalitarian democracy head-on. So much of their behavior is self-evidently burning the seed corn that remains, making off with the unsold family furniture, and leaving the rest of us with their unpaid debts while their loot accumulates in overseas tax havens and on the untouchable balance sheets of multinational corporations.
On Marx’s two-hundredth birthday, capitalism’s ideology is again enthroned, but that regime looks shakier than it has in a while.
Meanwhile threats of deportation, police violence, economic precarity, and environmental catastrophe loom, and the circle of who counts as a person with a claim to common resources continues to contract. The evident failure of the political and economic system that elites preside over to fulfill even the narrow functions they ascribe to it is a forcing action.
These are the fissures to be exploited against the ruling class. The ideology of capitalism is discredited once again, and that disgust with the existing ruling order can bring together a powerful, liberating—possibly irresistible—opposition. On Marx’s two-hundredth birthday, capitalism’s ideology is again enthroned, but that regime looks shakier than it has in a while.
Marx never got to see what capitalism looked like shorn of its ideology, and it is unlikely he would have believed it was possible. But today’s striking public-school teachers, Black Lives Matter activists, ICE abolitionists, and teenage gun restrictionists point the way to a world where citizens and workers can say no to established wealth and entrenched political power and refuse to be dominated by it.
Marshall Steinbaum is Assistant Professor of Economics at the University of Utah, Senior Fellow in Higher Education Finance at the Jain Family Institute, and a former research economist at the Roosevelt Institute. He earned a Ph.D. in economics from the University of Chicago in 2014.
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