Kallie Horton

POLS 420-801

Marx and The Nature of Capitalism

Karl Marx is widely known for his interpretation and analysis of the nature of

capitalism. By examining commodities, their dualistic value and fetishism, alienation of

labor, labor theory, and capital, Marx explains the defining features of capitalism and

exploitation. How this exploitation is built into the capitalist economic system, according

to Marx, will ultimately lead to the dismantling of capitalism itself and to a more socialist

followed by a more communist economic society. This theory, though widely debated,

can be recognized in our own economic climate today.

Marx was greatly influenced by Hegal, Adam Smith, and David Ricardo, this can

be seen in his beliefs and political theories. Though he does not agree with them

completely, Marx has his own ideas when it comes to society, economics, politics, and

philosophy. Marx believed “that history is evolving through a series of predictable and

unavoidable conflicts” (sparknotes). This becomes relevant when looking at Marx’s

revolutionary sequence where he predicts that there will be a chain of events that

begins with an economic crisis, followed by the immiseration of the proletariat,

revolutionary class consciousness, democratic seizure of state power, dictatorship of

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the proletariat, withering away of the state, and ultimately to communism. Marx also

believed that society as he knew it was far from being fully evolved, by looking at not

only his own authoritarian government but also by looking at “the social divisions and

civil unrest that was caused by industrialization and the increasing wealth gap”

(sparknotes). Marx believed that socialism was too naively idealistic, rather he set out to

develop his own theory grounded in economics and philosophy, by combining a

hegelian philosophical view of historical evolution as well as an interest in capitalism

built from economic theorists Smith and Ricardo.

Marx explains a commodity as an object that satisfies human needs and wants.

He also believed commodities to be the fundamental units of capitalism, which evolved

to become a form of economy that is based on the accumulation of these objects.

Commodities are endowed with a dualistic value, the first being its use-value. The

use-value of a commodity is the value that is intrinsic to it, it represents how useful the

object is in what it was made to do. The second value is placed onto objects, this is the

exchange-value. The exchange-value refers to the relative value of a commodity in

relation to another. The exchange-value can also be referred to by a commodity's

monetary value, since exchange situations have evolved to trading objects for money.

Marx concluded that the universal measure of value, expressed as monetary

value, corresponds to the time and labor that was put into making each commodity.

From this idea Marx built upon Richardo’s labor theory of value. According to Marx,

commodities have a social dimension based not on their intrinsic value but instead

based on the societal division of labor in production and system of economic

interdependence. Marx explained a phenomenon he called commodity fetishmism, this

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refers to inanimate objects being given the power to have an effect on human attitudes

and behaviors. Marx then looks more into labor processes where he explains the

alienation of labor that begins to separate workers from the finished products when the

labor is divided among tens or hundreds of workers to a single product in order to speed

up production. This evolved system and speed of production served to fuel the fetishism

of commodities and drive capitalism.

Marx explains capitalism as being founded on the principle of private ownership,

where the owners rely and depend upon wage labor to create a surplus of profits.

According to Marx, capitalists do not see money as the vessel through which they

exchange the commodities they produce for the commodities they need; rather they see

money itself as something to be sought after for its own sake. From this idea Marx

describes the process of the capitalist taking money and using it to produce

commodities, then selling it for more money, thus showing that the capitalist’s primary

interest is the accumulation of capital and increasing profits rather than the commodities

themselves. The only way to increase their profits depends on the workers who sell their

labor to the owner, the workers are then the commodity that the capitalist buys in order

to make a profit. According to Marx, the only way for the capitalist to accumulate more

capital is by creating a surplus value. Since the commodities value equals its labor time,

this extra value can only come from the workers. In other words, the capitalists force

workers to work longer hours in order to create this surplus value. The workers are then

paid the minimum wage possible, which usually is not enough if just barely enough to

survive off of, while all of the extra goes to the capitalist. This is what Marx explains as

the essence of exploitation. Marx argues that this mechanism of exploitation is

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fundamental to the capitalist economic system. While at the same time this mechanism

fuels and drives capitalism it is also the source of social antagonism that Marx argues

will eventually lead to the dismantling of capitalism itself. This is also clear in Marx’s

revolutionary sequence.

This exploitative relationship still exists in our capitalist economic society today

between owners and workers. It is clear to see when looking at billion dollar companies,

such as Amazon, whose owners hold the majority of the capital of the company while

the workers are paid next to nothing, working in extreme conditions for an unlivable

wage. This economic system serves only the interests of the capitalist who aim to pay

their workers as little as possible so that they can keep all of the profits. Marx argues

that this will ultimately lead to a rise in class struggle that will eventually overthrow

capitalism. Where it will then be replaced with a mode of production based on the

collective ownership of the means of production that he called, communism.

Although we have not yet seen this prediction come into fruition, society today is

slowly leading towards a more socialst means of wealth distribution. Perhaps, ever so

slowly, we will see a more equal and just distribution of wealth among workers and

owners alike.

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 Bibliography

● Marx, K., & Simon, L. H. (1994). Selected writings. Indianapolis: Hackett.

● SparkNotes. (n.d.). Retrieved May 13, 2021, from

https://www.sparknotes.com/philosophy/marx/section3/page/2/