Your introduction to differentiating between capitalism and leftism

BEIRUT - History News Editor

In order to understand leftist thought, one ought to understand its so to speak ancestor, capitalism. The latter can be summed up through highlighting the theory of Adam Smith, the first and foremost 18th century economist who put capitalism in words.

According to Smith, the market runs itself through supply and demand. When demand is higher than supply, prices increase. When the case is opposite, prices decrease. Smith recommended that there should be no rules and regulations for trade. This open and liberal theory made its followers adopt a trade or business style that has no ethics. Therefore, they coined mottos to express their trade policies such as “The Sky is the Limit.”

The lawless market necessarily created injustices. People with capital invested their money to double their capital. Less fortunate people without considerable cash sums had to settle for taking up any craft that would make them survive. The end result was a few capitalists piling colossal fortunes while the majority of the world population unable to feed themselves.

This market injustice made 19th century thinkers such as England-based German Jew Karl Marx and his friend Frederic Engels draw the guidelines for a more humane economic system. Marx noticed that capitalists piled surpluses while workers were poor. He thought that by evenly redistributing the surplus (including the abolishment of private property), everyone’s living standard would improve. Talking in a simplistic fashion, Marx said that people could produce whatever they please and receive in return whatever they need (to rephrase the initial simplistic Marxist phrase).

Marx yet committed another blunder when he ignored the principle which stated that division of labor was necessary for efficiency. Marx said that he would be able one day to work as a fisherman, another day as a hunter and so on.

Marx was also influenced by 19th century scientist Charles Darwin, the founder of Darwinism which suggested that the evolution of the different species on earth was coupled with the survival of the fittest. When describing Marx as a Darwinist, analysts mean to say that Marx believed that his ideology, Socialism, was the fittest socio-economic system for the human race. While all other systems were doomed to self-destruction, socialism would ultimately survive and prevail.

The unprecedented contribution of Marx, however, was his international perspective of class struggle. Unlike the dominant thought at the time that two empires would battle each other for “the honor and the dignity of their respective nations,” Marx suggested that sovereignty and national feelings (Lebanese nationalism, American nationalism, pan-Arabism, Syrian nationalism that all came later) where only advanced by those who monopolized the capital. That is, Marx believed that imperial (this word comes from the word Empire and an Empire’s expansion is imperialism) wars served the interest of capital owners disguised in national feelings.

Marx stressed the importance of scrapping all kinds of discrimination creating a new kind of affiliation, that of socio-economic interests. The international rhetoric was certainly a break through. Yet Marx failed, however, to promote tolerance among classes for he believed that one class, the class of barely defined workers, should take over other classes and rule. Mrax created a new faction, workers, instead of talking on behalf of all humans. Please note that not all of Marx work was saved.

Marx’s followers were not willing to wait until socialism achieves itself. Workers in Western Europe (mainly France, England and Germany) started organizing themselves into craft guilds and trade unions (syndicates are a later form of worker organizations and imply that a union has been authorized by the state or simply syndicated).

The powerful workers union in Western Europe started threatening the interests of their masters who started in turn giving concessions and privileges to workers. These privileges included health care, education, pension for unemployment (much later), retirement pensions and social security for workers and their dependents. As a result, the gap between classes was narrowed down and this system came to be called a Social Democracy or Sociodemocracy. Workers were not willing to go further as far as abolishing classes since they believed justice in the system was working. They did not want either to abolish private property.

The secret behind this system which worked in Europe for almost a century and is still working in Britain, Germany, Australia and Canada and Scandanavian countries among other states, was the system of progressive taxes. This system by itself reinsured distribution of wealth by imposing high tax which could reach 90 percent on the income of the wealthy and using this tax money to subsidize for the social welfare system that they offered for those who were in need. But these sociodemocratic countries with their commanded economies had to change their course. They believed that the state was not “a successful businessperson” so they embarked on privatization. France privatized car manufacturing of Citroen and Sweden sold Volvo factories.

While keeping the social welfare system, sociodemocracies abandoned state ownership of major production since capital flew form such countries, which imposed high taxes on capital, to more liberal markets such as the US. In terms of invention and increasing production, while the US invested enormous sums to increase its production at lower costs, sociodemocratic countries could not use similar amounts of money to catch up since they had to cater for social welfare.

Therefore, the US and its injustice invented cheaper production means while sociodemocratic countries had to sit back and see cheaper American (or Japanese) production taking over their markets. This made most sociodemocratic countries abandon their platform and adopt rightist policies such as privatization of state facilities. Some such as Britain are currently, incorrectly, abandoning welfare programs.

But making capitalism “kindler and gentler” as in Western Europe was not picked up by Russian leaders such as Vladimir Lenin. Funded by the German Emperor who wanted to topple the Russian tsar who was allied with France and Germany in WWI, Lenin started his revolution with a coup d etat.

For all those who don’t know about the Russian Revolution: In February 1917, a revolution by the “republicans” toppled tsar Nicholas II, killed him and established a republican rule. In October (according to Russian calendar which is actually November on our calendar) of that year, Lenin sponsored a coup d’etat and ruled the country until 1924. During his 7-year rule, he propagated communism (in its classical sense as Munir described it). There were no signs of democracy under Lenin, however. He spent time consolidating his power by fighting advocates of the republic (known as the Whites). He groomed someone who became his close associate, Joseph Stalin, history’s worst dictator.

Communism started with Lenin and spread to several countries that all became dictatorships such as China’s Mao Tzedong, Cambodia’s Pol Pot, Cuba’s Fidel Castro (despite his good health and education sectors) and many others.

This is only a short description of how Marx affected the economic policies of countries.