(A review of 'Das Capital' by Karl Marx
Review first written on July 12, 2019)
To judge a book by the way it affected the world is a mistake, though a tempting mistake. If we are to do so, almost all religious books will get a one-star rating because of the violent actions of followers of the respective religion. I don't wish to be so cruel as to judge Marx, his 'Das Kapital' or socialism, on the basis of human rights violations in communist Russia and China.
..... But even if we are to give in to this temptation, we will find that Marx has a mostly positive impact. Before him, the world was driven by a blind capitalist force which burns down everything to profits - mostly based on the exploitation of workers who (often mere children) worked more than 16 hours at times. Some laws for the benefit of workers were already being made by the time Marx wrote the book, but I think it is mostly thanks to Marx that overexploitation of workers is no longer taken for granted in the west.
Socialism can't be any more blamed for the suffering of people in communist countries (blame stays for communism, the political system) just as democracies cannot be blamed for their poor and homeless (blame lies with badly created capitalism, the economic system). Dr. B. R. Ambendkar, the father of constitution of India, said that political equality (the aim of democracy) can't be of much value without social and economic equality (the aim of socialism). Just as the solution to all problems of democracy is more democracy, the solution to all problems of socialism is more socialism. Unfortunately, the two systems seem to resist each other. Socialism seems to prefer communism or dictatorship while democracy leans toward capitalist or mixed economic systems.
Anyway, to get back to the book, Marx does an amazing job of bringing out the ways in which the workers are getting violated when he goes to real-life examples. But his theory itself seemed to be as absurd as that of capitalist economist he argues against. At the end of the day, a capitalist does take risks, does bring assets together, does bear the loss if such loss were to come; and deserves what goes by name of profit.
The problem is not profits, the problem lies in two things. First, how the profits are made. By exploitation of workers. Where profits can only be made by undertaking workers, such business have no right to exist. This trashes the argument of those who are against the minimum wages because it would reduce the profitability of businesses. Where businesses are too big to die, it means the government (and indirect taxpayer who mostly workers) is paying for inefficiency of Management who will get big cheques for their badly done jobs. If capitalism means survival of fittest, those managers should lose their jobs first.
Another cruel way in which profits are made is by way of heavy discrimination in salaries of upper and lower levels of workers. The CEOs of big companies might give a better quality of work than average ground level worker but the difference between the two qualities doesn't excuse the difference in reimbursement (the two can often stand in a ration of 100:1). Now I know I know a capitalist would say that salaries are decided by laws of demand and supply. the But then the supply of highly qualified managers far more exceed the need for them (a handful needed in any organization) than ground-level level workers can exceed their demand. To create an artificial scarcity of supply you could make education expensive. But even though education keeps getting expensive, the supply of workers top-level jobs still vastly outnumber the demand for them. A highly paid manager has good reason to exploit workers under him to make profits for his bosses or he risks losing his job and the big package.
Last cruel way profits or high incomes are made is holding onto ridiculously big assets. In Middle-East, it is oil the wells; in the USA it is technology giants like Whatsapp, Facebook, and Google. One important difference is that later have at least use their minds to create something truly valuable rather just get lucky. They might just seem to deserve all the money but, beyond some limits, we no more own products of our own genius than ones we inherit from fathers. A genius like money we inherited from poor looks are the gifts of accident of luck. The government in name of people will take away the old treasures that might be found in your backyard after paying you a percentage. I don't see why products of intelligence shouldn't go the same way.
The second thing that I'd wrong with capitalism is laws of inheritance. It is not always about survival of fittest but just as much as survival of children and grandchildren of fittest. You can call capitalism a race but a race is equal only if we start at some point. A country truly dedicated to capitalism would not let too much of wealth get inherited by the children. Capitalist countries suffer from income gaps because they aren't being capitalist enough. The best version of capitalism (at least as Adam Smith, another misunderstood soul sees it) would have best of socialism embedded inside it. The government of a truly capitalist country would take actions against corporations that resist workers (peaceful) movements.
Anyway returning back to book, I don't agree with Marx's ideas that capitalist doesn't add value to goods. But I do agree though that profits, rents, interests beyond a certain limit (beyond what might be needed to maintain the assets they are connected to) are an unproductive transfer of money from poor to rich rather than actually earned incomes.
I do have an argument of my own to make. You might fix sums to be paid to different stakeholders (workers, capitalists, entrepreneurs, landlords, government, )from revenue of the business and you will have a surplus left in the end. Now according to capitalism, this surplus belongs to an entrepreneur who has taken the risk in running operations and so a fixed sum is not big enough payment for him. But these days, you can shrug that argument off, and say he got insurance at a fixed premium to ward off the risk. And even if he didn't, the argument still holds - if an insurance company can undertake risk for fixed sum why not let an entrepreneur or capitalist do the same?
However, the problem is who gets the surplus? Who ensures that the system runs smoothly? Because that party would have too much power not to abuse it. In capitalism, it lies with filthy rich capitalists while in socialism it is taken over by the government, and though the last do so in name of workers, the workers who are the bulk of population do not gain much in either case.