Second episode of the Econ Playground Podcast with a long time pal of the site – John Halcovich. We discuss Medieval entrepreneurship and the Catholic Church.
This is an essay I wrote for my Karl Marx class this semester. Expect more along these lines.
The Projections of Classical Political Economy & Marx’ Solution in Alienation
The Karl Marx that inhabits the mind of many today is a gung-ho advocate for the working class, revolution, and a communist paradise. What else would one assume of the man who wrote a book called “THE COMMUNIST MANIFESTO”? While this image is not wholly wrong it confuses what made Marx unique among the socialists of his day. Marx had a disdain for those whom he called the “utopian socialists”; those who were enamoured by the paradise that communism, socialism, and other utopian ideals theoretically promised them. Marx’ project was of a very different flavor. He was not concerned with the reorganization of capitalist society to fit the needs of the less fortunate, a plan that could have aligned with the utopian dreams, but to overhaul the system completely and show its inherent flaws.
His focus was on showing the instabilities in the current system, and doing very little to speculate about what was to come in the future. His obvious adversaries would be the figureheads of economic analysis in favor of the current system at the time, those who we today call the classical economists. Their economic thought was built on certain categories, ideas, and presuppositions that were sourced from their individual assumptions about the world around them. These assumptions included the necessity of private property, the separation of the categories land, labor, and capital, and subsequently wages, profit, and ground rent. Marx’ critique was to show that these relationships which they held to be self-evident were in fact quite weak, and were an attempt to justify the economic chaos of capitalism. What Marx did was reanalyze the same world from a different, more real starting point, the relationship of the human to his world; in economic terms, the laborer to his product. Marx resulting analysis of capitalism from this perspective is what becomes the theory of alienation.
In this paper, I will describe how Marx analyzed these particular ideas in the Economic and Philosophic Manuscripts of 1844, and how he re-grounded his economic analysis of capitalism on the relationships between labor and objects that result in alienation. I will conclude with some criticisms and alternative approaches from other economists contemporary to and after Marx.
- The Foundations of Classical Political Economy
Often considered the godfather of modern economic thought, Adam Smith theorized in An Inquiry into the Nature and Causes of the Wealth of Nations (1776) what it was that made some nations wealthier than others. He offers a number of explanations, most notably that men are more productive when they divide their labor among one another. From him developed theories of other influential economists like David Ricardo, Frederic Bastiat, and John Stuart Mill.
In the Economic and Philosophical Manuscripts of 1844, Marx outlines certain presuppositions that these thinkers took for granted and attempts to explain their existence while simultaneously destroying their necessity. Taking from the tradition of the Young Hegelians and Ludwig Feuerbach, Marx believed that man projected his ideas onto the world and did not indifferently receive the “truth” through senses or rationality. Feuerbach analyzed how man projected religious ideas onto the heavens, while Marx analyzed how the economists projected private property and other economic categories onto the world around them. “Let us not be like the political economist who, when he wishes to explain something, puts himself in an imaginary original state of affairs. … Similarly, the theologian explains the origin of evil through the fall, i.e. he presupposes as an historical fact what he should be explaining.” (McLellan 86) Political economists would assume a state of nature that presupposed those categories that their theories were built upon, the individual, his rights, and thus his property.
The position that Marx notes the classic economists start from is private property. The relationship of owner to owned is primary. It is from this relationship that they derive the concepts of the different economic goods to be owned. The major categories of economic goods were Labor, Capital, and Land, however Marx notes that there is absolutely no reason to separate these categories. The economists only feel the need to separate these as they have accepted these categories from their experience in their specific economy. “Political Economy starts with the fact of private property, it does not explain it to us…. Political Economy does not afford us any explanation of the reason for the separation of labor, and capital, capital and land.” (McLellan 85) From private property, the only force that drives the economic agent in capitalism is greed and the competition that results from said greed.
Marx lists a number of things that the economist haven’t been able to explain as of yet with their theories as they are based on private property. “…new contradictions have arisen it its doctrines, of example, between that of monopoly and that of competition, freedom of craft and corporations, division of landed property and large estates. For competition, free trade, and the division of landed property were only seen as fortuitous circumstance created by will and force, not developed and comprehended as necessary, inevitable, and natural results of monopoly, corporations, and landed property.” (McLellan 86) How can monopoly exist in a world grounded on competition? How can there be free trade when corporations exist? Is the feudal system really overturned when capitalist estates are just as large? Marx attempts to solve these problems by basing economic analysis not on the relationship of owner and property, but on the relationship between human and product. This is a relationship that is in fact necessary to every human society, unlike the arbitrary projections that the political economists made onto the world.
- Marx’ Answer in Alienation
Marx begins his regrounding in the Economic and Philosophical Manuscripts of 1844 with the statement, “We start with a contemporary fact of political economy: The worker becomes poorer the richer is his production, the more it increases in power and scope. The worker becomes a commodity that is all the cheaper the more commodities he creates. The depreciation of the human world progresses in direct proportion to the increase in value of the world of things. Labor does not only produce commodities; it produces itself and the laborer as a commodity and that to the the extent to which it produces commodities in general.” (McLellan 86) This is the beginning of the concept of alienation, and it is from this necessary relationship that Marx analyzes capitalism.
He elaborates on four aspects of alienation:
- The laborer in the capitalist mode of production, alienates his product from himself when they are owned now by the capitalist through the imagined system of private property. This creates a world of things and traded commodities opposed to the human world. Just like in religion a creation of man is subsuming the products of man. “It is just the same in religion, The more man puts into God, the less he retains in himself.” (McLellan 87)
- The laborer must make the labor itself a commodity and he now stands opposed to himself. Labor is forced upon him, and it is no longer his home. He is slave to the whims of his economic conditions. His only solace is “leisure time”, that time that he is not producing any good. He consoles himself with his animal functions; eating, drinking, procreating etc.
- The third aspect is derived from the other two. Man is now alienated from his species-being. When nature is alienated from man, and then man alienated from himself, labor is now only a tool to serve his individual interests. The only reason for life and labor is to further extend one’s own life. Labor extends life, but it does not produce authentic human life. Human labor no longer retains the purpose of living in the species, but in putting the individual interests ahead of species interests, denying an important part of the human essence.
- As man is alienated from his species, he is now also alienated from other men. Man relates not to other real members of his species, but to them as other commodities vying for a position in the labor market. “…the relationship of man to himself first becomes objective and real to him through his relationship to other men. So if he relates to the product of his labour, his objectified labour, as to an object that is alien, hostile, powerful, and independent of him, this relationship implies that another man is the alien, hostile, powerful, and independent master of this object.” (McLellan 92)
The relationship between worker and product can explain the apparent contradictions in political economy by collapsing the categories into a single necessary one, the human category. Private property can now explain itself. What private property in fact is, is the consequence of the now created world of things. It is man’s attempt to explain and justify his own alienation. “But it is evident from the analysis of this concept that, although private property appears to be the ground and reason for externalized labour, it is rather a consequence of it , just as the gods are originally, not the cause but the effect of the aberration of the human mind…” (McLellan 93). The theoretical positions of private property and labor are now flipped.
The concept of wages and prices are now subsumed as well. They become one with the mechanism of private property, they are a system used to explain and justify the exchange and patterns of the world of things; the world of commodities that are created by alienation. “..wages and private property are identical: for wages, in which the product, the object of the labour, remunerates the labour itself, are just a necessary consequence of the alienation of labor.” (McLellan 93) It is also worth noting that this is why Marx refused the idea that raising wages or redistributing products would solve the issues of capitalism. The problem was that the world of things was siphoning life out of the human world through the processes of alienation. Any reorganization of that world would do no good to close the gap. This is what he often saw in other socialists such as Proudhon.
The only solution to alienation was then to destroy the concepts that kept it alive. The abolition of private property was the only means of truly liberating the workers and thus humanity. Marx’ had offered a bedrock for analysis of capitalist economy that made no unnecessary assumptions in the style of the political economists. Marx had no need to explain how socialism would work. All that he needed to show was that capitalism inherently contained a flaw that alienated humans from their products, themselves, their species, and each other. What happened after class consciousness was obtained and private property was abolished was not an issue to him yet.
- Alternate Criticisms
Marxian critique itself is hotly debated, but what is rarely brought into question is the necessity to critique those presuppositions the classical economists held that seem so arbitrary in hindsight. The following are other approaches that critique both the classical economists and Marx’ fashion of critique itself.
- Carl Menger and Subjective Valuation.
Marx was certainly not the only one to realize that classical political economy had presupposed its categories. Carl Menger, an Austrian economist, similarly noticed that the economic categories which the classicals had devised were wholly arbitrary. He was also concerned that they could not explain the effect that the buyers in a market had on the price and organization of production. Their theory of price determination rested on the costs of production to the seller, and the theory that the value of a good derived from the labor time necessary to produce it. This theory of value was also taken up by Marx. Price determination was calculated by analyzing the nature of the production costs of goods in broad categories which they had arbitrarily designed. The nature of the goods was what determined the actions of the economic actors. In Marx’ terms, the human world was a slave to the world of things.
Carl Menger made a similar move to Marx when he re grounded economics on the human, but instead of the relationship between laborer and product he grounded it on human action. “Man is himself the beginning and the end of every economy.” (Salerno) He developed a perspective later known as subjective valuation, in which each action by humans was a result of one attempting to satisfy their own perceived need. The economic categories that the classics needed to explain their theories were no longer necessary. Private Property, wages, and prices are not explained by the nature of economic goods in the world of things, but on the terms of each individual’s subjective valuation. Marx would respond to Menger by revealing that his system never in fact overcame the process of alienation. Marx believes that alienation is inherent to the capitalist mode of production. When Menger says that humans act to satisfy their subjective needs and wants he shows precisely what Marx meant by alienation from species-being.
- Ludwig von Mises and the Socialist Calculation Debate
Ludwig von Mises was a student of Carl Menger and participated in a series of debates with socialists now known as the socialist calculation debate. Mises conceded the Marxian idea that if private property were abolished, humans would be able to put species or collective interests in front of individual interests. Marxism, by being primarily a critique of capitalism, avoided criticism of any specific form of socialism as it made no central claims as to what a post-private property world would look like. Mises thinks this an unsafe outlook to base a social movement on. “There is a danger, however, in examining socialism only indirectly through a study of capitalism: Potential problems of socialist organization are apt to be ignored.” (Lavoie 29)
Mises problem with Marxism is in the role that he saw property rights and prices played in the economy. They functioned in Menger and Mises’ systems as guides that told economic actors more about the economic conditions that were outside the bounds of their knowledge. No one economic actor could contain the total economic knowledge needed to make decisions, and prices through private property and exchange reflected this knowledge to them indirectly. If man is to live as a species-being it necessitates the organization of a central plan and a realized economic order without prices or private property. Therefore, Marxian socialism would need to overcome Mises’ knowledge problem. “…if, as Mises calculation argument contends, there is a fundamental flaw in Marx’s socialism, this error must also be reflected somewhere in the Marxian analysis of capitalism.” (Lavoie 30)
Marx realized that the classical economists were projecting their own explanations and justifications for the society that they lived onto the world around them. He was able to explain their reasons for creating these ideals through the theory of alienation. Private property, wages, and commodities can all be understood as a coping mechanism with the process of alienation. Private property alienates the laborer from his product, and then out of necessity private property is designed to make this relationship appear necessary. Marx was not the only one who argued against the classical economists shortcomings, but his particular theory was one of the first and most systematic attempts to rigorously critique classical political economy in order to overcome it.
- Works Cited
- Marx, Karl, Selected Writings, 2nd edition, D. McLellan (ed), Oxford University Press, 2000
- Salerno, Joseph T. Biography of Carl Menger: The Founder of the Austrian School (1840-1921). Mises Institute, 18 Aug. 2014, mises.org/library/biography-carl-menger-founder-austrian-school-1840-1921.
- Lavoie, Don. “Chapter 2: Marx’s Socialism.” Rivalry and Central Planning: the Socialist Calculation Debate Reconsidered, Mercatus Center, 2015, pp. 28–48.
Hayek, by far my favorite economist, gets overlooked by a vast majority of those engaging in political discourse or those studying economics. Too often he is dismissed as a “free market shill”, a “greedy capitalist”, or another form of right wing pundit. For certain figures I admire, this very well may be true, but Hayek is profoundly different.
Hayek’s break from other libertarians is in that he doesn’t rest his argument on a particular case for natural rights to homesteaded property, or on the efficient allocation of resources that come from markets. Hayek’s argument rests on first the infallibility of government to centralize economic or social knowledge, and second in the ability of liberty to open up previously unopened paths that manifest themselves in spontaneous order.
If that seemed complicated don’t worry! Because there is a book for you! The Essential Hayek by George Mason Economist Donald Boudreaux. In less than 80 succinct pages you will understand basic concepts that underlie Hayek’s work. To me what was most interesting was the point that people believe they can apply small scale planning structures like the family to the nation. An idea that might seem intuitive to some, but is woefully misguided.
I recommend for absolutely everyone.
8.5 out of 10
“But nobody can be a great economist who is only an economist – and I am even tempted to add that the economist who is only an economist is likely to become a nuisance if not a positive danger.”
I can’t seem to get enough of the writing style of Deirdre McCloskey. I’m not sure if it’s the comfortable sarcastic tone of her prose or the fact that I’m able to relate as an economist. And by sheer luck, I was able to obtain a signed copy of How to be Human (Though an Economist). The signature is addressed to Cynthia, so I hope Cynthia whoever you enjoyed the book enough to sell your signed copy (apparently the exchange value was greater than the use value).
This book is a collection of essays written mostly for various journals and newspapers. They are grouped into 15 sections, each being a rule for economists to follow in order to achieve humanity. Well not precisely. They are more of a much-needed ethics handbook for economists. A Hippocratic Oath for economists if you will.
Some essays focus on the life and attitude of a particular economist to follow among whom are Armen Alchian, Friedrich Hayek, and James Buchanan. Others cover particular issues McCloskey sees in the attitude of modern day academic economists. Some are as simple as how to properly run a seminar.
The central piece of advice, running through all the chapters, is to avoid an attitude of sneering at other disciplines as “less scientific” or “inefficient”, and in fact trying to incorporate these ideas into our own discipline may be useful. McCloskey’s critique of economics as a whole is that we have left our roots as primarily storytellers about the way that people act in the world and try to gain a sense of intellectual security in mathematical equations. She often goes back to Adam Smith to remind us of his oft-neglected other book The Theory of Moral Sentiments. After all, he thought of himself first as a moral philosopher who accidentally sprung to life the discipline of economics on the side.
I recommend this book mostly for those who are in the economics world themselves. Those from outside our sphere will enjoy some of the stories and can still take much of the advice, but some examples may not be as directly applicable. One complaint stems from the fact that these are a collection of essays not written with the intention to bind together so a lot of the ideas overlap and it can feel quite redundant at times. However, what is repeated is so important that it really can’t hurt that much.
8.5 out of 10.
Edit: I didn’t know the definition of pedantic.
It’s undeniable that Bertrand Russell has had an intense influence on a very large portion of Western thought since his heyday. In some ways, he is the quintessential dogmatic academic. His ideas about logic, ethics, and philosophy at large have lasted as the vast library of analytic philosophy over the last century. He and his colleagues constructed a system via logical positivism that seemed at the time to close many of the gaps in philosophy. Russell himself calls it the answer to all the inconsistencies in Kant in closing the gap between a priori knowledge and a posteriori knowledge. From this perspective, he is able to look back at the entire Western canon of philosophy and make judgments about each and every philosophical position.
The book is written not with an emphasis on who Russell thinks was right, but on who was influential. Three chapters are written on Locke though his inconsistencies are persistently pointed out. It is split into three books. The first on Ancient Philosophy, the second on Catholic Philosophy (which he more or less equates with the Dark Ages), and the third on Modern Philosophy up to and including himself (that is concluding with himself).
A majority of the book feels not as if Russell wanted to provide his readers with a wealth of historical information, but as a stage upon which he makes fun of and pokes at everyone else’s ideas. This attitude seems to be justified by his occasional assertion that everyone else isn’t scientific enough and they are religiously holding on to ancient dogmas which he is lucky to be enlightened enough to let go of. He describes other philosophies as inferior to his own in that they are not on an “indifferent quest for truth”. His attitude is reminiscent of (and likely informed) popular contemporary intellectuals like Bill Nye, Sam Harris, or Neil DeGrasse Tyson. It seems as if he does a disservice in writing the book by interjecting every few pages to include his own opinions, and gets especially worse by the end of the book. Especially his chapters on Hegel, Nietzsche, Marx, and the pragmatists he shows great dislike and contempt for their philosophies (not to mention that he wholly emits existentialists like Kierkegaard and Heidegger). I can’t help but think that his vitriol is leftover from arguments he had in graduate school.
Economist Deirdre McCloskey calls Bertrand Russell a paragon of our current phase of modernism or a dogmatism that claims we have finally found the correct way of doing things. His chapter on Hume brings up many contentions to the foundation of his own reason, and he even mentions that many of Hume’s problems haven’t yet been solved. However, he conveniently forgets these when he reaches his own philosophy.
In spite, of my complaints, I think that the book is well worth reading by any interested in a general picture of Western Philosophy. Though be warned that what you are reading is nowhere near a consensus, no matter how it is presented.
Ultimately, I give it a 6.5 out of 10 with a big Bias sticker.
My father, being a casual video game player, will occasionally spectate my endeavors into virtual realms. Being interested in game design he will on occasion comment on my game, usually ridiculing it and very rarely praising it. One particular gripe that he has had with many games is in the respawn function in which your character can die and then continue the game. Compared to the arcade games that he would have played back in the 80s, the consequences of failure or death in a video game is no longer a simple and blunt GAME OVER. Players are just slapped on the wrist with a loading screen and then plopped back perhaps a few steps. Essentially, games with narratives are just models of plots in which the players provide some of the exogenous variables as I discussed in my article on Economics and Plot Vol 3. Various models of death have significant impacts of both artistic importance and in the construction of a solid game without plot holes.
To start we could categorize game death models into two categories. The first being permadeath, and the second being some sort of respawn. Permadeath would entail that once the game has decided that you have died, then the game ends and you must start over from the beginning. This would be similar to the arcade games of my father’s era. A respawn would not make the player begin the game again, but would bring the player back at some checkpoint or when they last saved. Most games today function this way. Perhaps because most games are in the home rather than a quarter a play. Respawns can be brought down to two additional categories as well. One being the in-game universe respawn and the other being the out of universe respawn. In-universe respawns give an explanation in the story of why the player can continue playing after death. Out of universe respawns merely let the player continue from a checkpoint or their last save. There are of course some games that fall in between these respawns and permadeath, so they are not all-encompassing. Some examples would be Super Mario Bros. and Contra where they have a respawn model until the player runs out of lives. The permadeath model is fairly self-explanatory and now mostly out of date so I will focus on the respawn model.
One of the most important features of any game is the separation of knowledge between the player and the character they are meant to represent. Both Skyrim and Diablo have respawn models. In Skyrim, the player respawns at the last save. In Diablo, the player respawns at the last town (checkpoint). If a player is in a Skyrim dungeon and dies, they will now replay the area on the path to their quest between the save and the location of death. Since the path will be the exact same that was just experienced, the player then has knowledge that the character does not lead them to make decisions that would disrupt the coherence of the plot, damaging both the player’s experience and the artistic integrity of the game. In Diablo (or my preferred clone, Path of Exile) each dungeon or area is randomly generated every time that the player goes through. If the player dies and re-enters the zone, the player and character have the same amount of information with roughly the same difficulty. If the player is meant to represent the choices of the character then their knowledge must match to allow the game to maintain a coherent series of events.
Subsequently, it becomes quite difficult for the game designer to construct a story that surrounds their death model. The Skyrim or “Last Save” model can be copied into most stories quite easily, but the Diablo model might be quite difficult. A game I have found to have a quite good integration of the death model and the lore is the MOBA SMITE. In Smite, you play as one of the gods of ancient mythology battling it out over various eternal battlegrounds. When you die, there is a penalty period depending on the strength of your character, and then you respawn at your team’s base. This makes total sense in the context of deities fighting with one another as they are presumed to be immortal. The epic saga Bioshock respawns the character in a nearby Vita-Chamber which were apparently reincarnation tools used by the crazed residents of Rapture. However, you still lose the bullets that you used before you died, so there really is no complete do-overs. The popular FPS Counterstrike also takes a hard line as opposed to its
counterpart Call of Duty in that a death is a death. There are no respawns until the next round. This has led to Counterstrike having a much more respected competitive community than COD, but that might have to do with the target demographic for both games.
In conclusion, video games, like any other narrative art form, is to some degree subject to economic law. The player-character dichotomy can likely be further studied and the split is almost reminiscent of the classic problem of mind-body interaction that plagued the modern philosophers. However, in this case, it becomes a problem that the mind knows more than the body ever experienced, and can reincarnate itself after the body has already died. Spooky. The death problem and other player-character problems hopefully will inspire game designers in the future to get ever more creative with their stories and break new ground in the art form of the future.
Photo Credit: https://i.ytimg.com/vi/votpmwC25Ek/hqdefault.jpg
This is a short video that I did for my AP Euro class last year. Again thanks to Mr. McCauley. It’s on the topic of mercantilism and particularly the policies and ideology of Jean-Baptiste Colbert. This is the first upload to theeconplayground youtube channel so be sure to subscribe to that as well.
The following is a rough outline of a philosophical theory that I’ve constructed. It follows a pragmatist vein that I’ve been reading into after getting into t
he work of University of Toronto professor Jordan Peterson. Also a bit of Wittgenstein influence in there. The italicized sections are my father’s comments. Anyone with additional insights on either of our
comments is highly encouraged to comment below.
I.The fundamentally undeniable is the existence of reality
(Descartes: I think, therefore I am.)
II. The second undeniable is that reality does not and likely cannot match our perceptions and thoughts perfectly. (more the reverse, our perceptions are limited, we cannot comprehend reality perfectly. The ideal is to understand reality, not for reality to conform to our concept of it.)
III. Reality can never be known but truths can be known.
IV. A truth is a reference for guiding action in reality.
A. They are typically manifested in thoughts which are constructed with words, but can be manifested in artistic representations.
B. For example time is a truth that we behave by, but can’t prove that it is a part of reality as the only clue we have to it’s existence is in our memories and predictions.
V. A truth is judged based on its claims about reality when put into practice.
A. In other words when you live by correct truths you will never trip.
B. Truths are correct if they are useful.
C. If you were to behave as if time is not a part of reality you could achieve nothing, but if you believed in time you could use it towards goals.
In summary, a truth can be classified as useful or not useful
Can something that isn’t true be useful? A “Convenient fiction”, like property rights.
VI. One particularly useful way of organizing truth is the module.
A. A module groups truths together as either describing a codified section of reality or as a pathway to a certain goal.
1. The module that we call economics is a grouping of truths about the section of reality that we call action and choice relative to scarcity.
2. The module of parenting is a grouping of truths that relate to the goal of raising children.
B.Something can be modularly true, but not have a particular guide to action.
1. This is the use of the correspondence theory of truth.
Something is true if it corresponds to the module properly. This is very useful in the temporal, spatial, and physical modules.
What do you mean modularly true. True only within the module, but not outside?
The something is usually called an “assertion” or a “statement”. My hat is black.
VII. We construct modules of truths to guide us to a position from which we need take no more action.
A. This can be called the position of eternal peace and is the goal and meaning of our existence as we understand it.
B. The position of eternal peace does not mean motionless and can exist in the module of time as a vector of some sort. (See Wittgenstein’s quote in the quote page on the sidebar)
But for many, taking action is worth it in itself. Eternal peace is dull and boring.
VIII. The ultimate module is one which claims to group all truths of reality.
A. Traditionally the ultimate module was the religious module.
B. Also the philosophy module.
C. When the module of physics took over as the ultimate module the “Death of God” occurred.
D. It did not work as truth because it could not guide action towards eternal peace as it is constructed for. Science alone does not explain the world enough, yet.
It took a while, most physicists saw themselves as exploring God’s creation.
Bertrand Russell thought: all reality can be written down as mathematical formulas
Goedel proved: it can never be written down completely, there are always statements that cannot be judged true or false.
IX. What I call for is a reconstruction and revival of the religious module as the ultimate module.
That’s pretty strong. You may want to hold off on calling for something. May want to flesh this theory out a bit first. Get feedback.
Last night I was a guest on the Wizardly Wisdom podcast with Kenn Williamson from libertariannerds.com . This is the first time that my voice has appeared on this website so enjoy!