Marxism and Globalization

Marcus Niski

For Marxists…

• Globalization is the extension of the capitalist system across the whole world…

• The Capitalist system has not always existed and could cease to exist and be replaced by a better socialist system…

• Capitalism – according to Marxists – also has inherent structural flaws that will eventually lead to its inevitable downfall. These seeds are already sown by the very nature of what capital seeks and how its voracious mechanics operate…

The main actor in the process of globalization is not nation states but capital seeking ever new

ways of self expanding…

The capitalist system can only exist by constantly expanding… based on voracious consumption…

But it is prone to cyclical crisis…No better example of this can be found that that of

the current GFC

What is Capital?

• Capitalists produce goods for profits and these profits derive from the value produced by workers…

• Capitalist profits come from the exploitation of

the working class according to Marxist theory. This exploitation leads to class conflict… as labour is only capable of offering itself in exchange for a viable wage…

One side of capital

• Marxists believe the process of capital accumulation is a two edged process…

• It creates enormous wealth; it frees individuals from the shackles of traditional cultures...

The other side of Capital

• However, the capitalist system is also out of any conscious human control…

• Because of this all kinds of terrible consequences result – including war, hunger, environmental destruction and human alienation…

So, who was KARL MARX anyhow…

• Marx was an extremely influential writer whose profoundly important work Das Kapital lead to a body of theory that associated his name with the term Marxism

• Marxism ultimately became known as a distinct ideology that critique the nature of capitalism and all that it stood for - most particularly the relationships between enterprise, ownership, capital, wealth creation and wealth transfer…

Das Kapital (Capital): Marx’s Masterwork…

• Brilliantly historical analysis the nature of capital and the system we have come to know as Capitalism…

• Examined in minute details issues such as–• Money as a mode of exchange• The nature of ‘commodities• The transformation of money into capital• The nature of manufacturing and the industrial revolution• The regulation of the working day and the factor environment• The ‘alienation of labour (a famous example of Marx's

theories

Potential for Crisis…

For Marxists …• Capitalism is a mode of production which

contains the potential for crisis and breakdown. Capitalists face two kinds of problems.

• The first is how to ensure that the goods that are produced can be sold.

• There is always a threat of over-supply of commodities to markets

• If commodities cannot be sold capital is destroyed and cannot be reproduced

Potential for crisis

• The second is rising costs; for example the cost of labour power becomes a problem if workers struggle to increase wages because increases in workers wages reduce profits.

Capital creates its opposition

• Capitalism always faces crisis and for Marxists these crisis lead members of the working class to develop a collective identity and struggle to replace capitalism with a way of organizing production which is guided by human beings...

The Present Crisis Predicated by Capitalism: On The Pathology of Mass

Consumption…• Capitalism undoubtedly is totally dependant on consumption of

goods as the very pivotal basis of its existence…• As we are seeing in what is often termed ‘late capitalism a

number of structural crisis are emerging given the voracious nature of consumption in our society…

• These include:• Class divisions based on haves and have note who cannot consume

due to their minimal wage earning capacity• Fetishism of commodities to the point whereby the subsume human

relations themselves• A cultural that mesuares almost everything according to a persons

capacity to purchase• Individuals become mere marketing entities and are de-humanized

through the process of mass consumption• Social problems arising through d=family degradation and

breakdown…

Globalization not new

• In one sense, globalization is not new. A world market existed in the 19th century.

• Companies would produce goods in Europe or in America and later in Japan and sell them to the world.

• Ultimately, the labour race to the bottom in terms of cost lowering…

Colonisation and imperialism

• Colonization was part of nation states’ efforts to secure sites of raw material and markets for capitalist within the metropoles of capital...

• This was what might be called classical imperialism. In the colonies it led to the birth of independence movements…

• In the metropoles Lenin argued it led to a labour aristocracy.

Neo Colonialism

• By the 20th century not only were goods exported but so too was capital – or money and that used to set up companies all over the world. ...

• This did not involve conquest of land but simply investment by capital in nation states formally independent. Some call this neo-colonialism. ..

Global Production

• The second half of the 20th century saw the development of the multi-national corporation.

• Production is on a world scale (e.g. the world car, the computer, fox studios)

• Capitalist no longer need be connected to particular nation states.

• Nation states can be a barrier to the movement of capital; that is to the ability of capital to secure sites or raw material or to secure markets for commodities.

Free Trade Means Freedom for Capital

• Corporations scan the world for cheapest labour costs and set industries up wherever labour power is cheap and effective.

• Free trade really means – increasing the power of capital to obtain

reduced costs of production and – find the maximum number of buyers for

commodities.

Global institutions

• The World Bank, World Trade Organization and the International Monetary Fund serve to break down barriers to the expansion of global capital.

Casino Capitalism

• This refers to the incredible difference between the trade in goods and services and the trade in money. $1.5 trillion daily in foreign transactions

• 98% speculative eg buying and selling currency.

• Also means 2% financing trade in goods and services

• For Marxists the root cause of this is that capital is in oversupply – no markets to invest in.

Current global economic crisis

• For Marxist the current global economic crisis is due to the inability of capital to expand production and find new markets for commodities

• Instead of investment in new production capital has been diverted into financial speculation

• Capital has been destroyed and not available for productive reinvestment leading to crisis, unemployment and increased class conflict.

Socialism…

• For Marxists the solution to these crisis is the replacement of a global capitalist society by a global socialist society…

• State regulation within the capitalist system cannot adequately address the crisis that is inseparable from the capitalist system…

Essay Topics

• ‘Globalization of the capitalist economy is a liberating force for women in developing countries’. Do you agree?

Women and globalization

Marxists• Agree with liberals about the freeing of women

from the confines of the patriarchal family• But also see women as cheap labour power in

the firms set up to exploit them. • Women need to come together and develop a

new class-consciousness in the new workplaces and struggle to improve their situation.

Environment and Globalization

‘The globalization of the capitalist economy undermines collective responses to the environmental crisis’. Do you agree?

Environment and Globalization

For Marxists • Environmental destruction due to production being in

hands of individual companies; focus on short-term profit making – no matter what the environmental cost

• For global corporations environmental regulation an expensive cost. Globalization is a race to the environmental bottom

• Need for a different form of production consciously guided by human beings with the sustainability of the environment in mind.