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Marxism is the name for a set of political and economic ideas. The base of these ideas comes from the works of Karl Marx and Friedrich Engels. They have had a lot of influence in many countries. Very often, both authors are named, as it is difficult to say which of the two wrote what piece of the theory.
Marxism influenced other political views, such as Social Democracy and Reformist Socialism (both believe that the ideas that Marx and Engels portrayed can be achieved through what Marx called 'Bourgeois Democracy.')
Many Marxists say that modern "Communism" is not Communism at all. That nations such as USSR, The People's Republic of China, Cuba, and Vietnam are different forms of Capitalism, often with heavily "nationalized" industries. One of the biggest proponents of these ideas in Marxist thought was Tony Cliff, who wrote that states like the U.S.S.R and Communist China (before 1980) were "State-Capitalist." Not all Communists, Socialists or Marxists agree on this question, but many hardened Marxists generally agree that Socialism is workers' democratic control over economic decisions and social justice, while production is based on what people need, and that Socialism will wither away into Communism when Capitalism is defeated. With that idea in mind, Marxists have a tendency to discredit most of the listed regimes.
Modern Communism claims to be based on Marxist ideas, but many Marxists disagree about whether Communist countries have understood Marxism correctly.
The working class and the capitalist class
Marxism says that people in the world are organized into different groups or classes based on their relationship to how things are made. Most people are called "workers" because they work in factories or offices or farms for money. They belong to the "working class" (or "proletariat"). Another group, who are not as big as the working class are "capitalists", because they own the factories, land and buildings that the workers have to work in and also own all of the tools the workers have to use. Marx calls Capitalists the "Ruling Class" because they live off of the work of all the workers. He also says that the Capitalists own the government, army and courts. In Marxist views, Capital is the "means of production" and money which the Capitalist can invest in different places of business so that they can "profit" or gain more Capital.
Most workers work for companies owned by Capitalists or "Petit-bourgeois" (small business owners). The capitalist pays a wage to the worker in exchange for the worker's time. The capitalist has bought a period of time from the worker which the worker must then use to labor for the Capitalist, which according to marxist economic thinking is the only thing that can create value in a commodity, and then exploits the time of the worker as much as they can. The capitalist amasses capital by paying the worker less wealth than they make for the Capitalist. Marx says that commodities (pieces of merchandise) have a twofold nature. On the one hand, they are "use-value". Use-value means they are useful, that is, they have the capacity of satisfying a human need. On the other hand, they are "exchange-value", because someone could trade a quantity of them for a determined quantity of another commodity. For example: if a nail is traded for 2 bootlaces, the exchange value of a single nail is 2 bootlaces. Finally, "Labor Value" or Value, is determined by the amount of labor needed to create a product. Value is created by adding work to something. A product's value is determined by the average work needed to create the product for the market. Value can be described as the amount of labor time used to create a commodity.
As an example: Peter and Bob and Carl are all shoe makers. It takes Peter half a day to make 20 shoes, and it takes Bob half a day to make 20 shoes and it takes Carl half a day to make 20 shoes. The average labor-time to make the shoes is half a day, and that means each shoe contains half a day's labor value.
Peter, Bob and Carl now work for James. James owns a shoe factory that can make 60 shoes in half a day. Between Peter, Bob and Carl, 60 shoes are made. Peter, Bob and Carl are paid only as much as they need to live at socially accepted standards. Peter, Bob and Carl each get 20 dollars a day in wages, however James sells the shoes for 2 dollars each. $120 is made and James pays the workers (Peter, Bob and Carl) their wages. The remaining wealth is called "Profit" or "Surplus Value." In other words, Peter, Bob and Carl earn enough to provide for themselves within half of their working day. The rest of the day they are creating profit for their boss, James, which is called Surplus Value.
It is this Surplus Value, or Profit, which Marxism thinks as an exploitation of labor. This exploitation allows the smaller class (Capitalists) to live without laboring, while the bigger class (Workers) have to work for the Capitalists to survive.
Marxism says that Factories, tools and work places cannot create new value on their own. Similar to how a blueberry bush has no value on its own. That value can only be created with the use of labor. For example, someone spends a day picking blueberries. Those blueberries are now able to be traded or eaten because of the invested labor time to pick them.
Marxist thinking claims that Capitalists and Workers are in a constant state of struggle, which they call "Materialist Dialectic." Marxism says that in order for Capitalists to generate profit quickly, and to maximise their rate of profit, they have to exploit the workers as much as possible, and lower their wages as much as possible. Workers, on the other hand, have to struggle to keep their wages up, to keep the "rate of exploitation" low, so that they can live more peaceful lives. This is what Marxism calls "Class Struggle" where Workers and their Bosses fight against each other to gain for themselves.
Marxists think that all of written human history has been divided by economic classes. They think that the progression of history has been pushed forward by class struggle. Marxism says that it is from this struggle that Capitalism was born and that it is from this struggle that Communism (or Socialism) will be born. For example: Feudal Society (a society controlled by feudal Lords and Nobles) rested its Ruling Class on the labor of peasants (farmers). But, as peasants demanded more and more for themselves small shopkeepers and tradespeople began to appear. Many of these people appeared in Guilds as well, and eventually began to employ workers to independently accumulate wealth. It was this historical progression that created Capitalists/Capitalism.
In the same way, Marxism says that Capitalism will give way to Communism, as the struggle of the workers becomes more and more revolutionary.
The core of Marxist thinking is called Materialism. Materialism is a philosophical view that says that communities develop from the "ground up": that the "higher" qualities of culture (Art, Manners, Customs, Religions, etc.) are actually founded on the "lower" or simpler qualities of life (abundance of resources like food and shelter, who has money and what they have to do to get it, who is allowed to work and who is forced to work).
Changes in the higher qualities of culture (sometimes called the "Superstructure") are often linked to changes in the lower qualities of life (sometimes called the "Base"). One example is that in the Medieval period, "honor" or duty to one's superiors was seen as very important; today, in Western countries, ambition or being someone who works hard for their own goals is seen as more important—this is because in the Medieval period, people worked their entire lives under lords who depended on them not only for work but for war; today, people work on a more individual basis, and our society operates by letting some people move up from being poor to rich (though this is still very hard). In this case, what is seen as good depends on how the rulers get value out of their workers.
Marxism recognizes that in earlier time periods, we lived first under rulers who owned everything, then we lived under lords who owned land with workers who lived on them, and that we currently live under governments that allow many people to own property (though still organized in a way that robs many people of their labor and rights). Eventually, Marxists believe that we will move to a society where everyone owns everything in common—this will be known as Socialism.
In other words, human progression has been based on genetic evolution and social evolution, that human society has always been based on the economic forces that human beings can control. For Marxism, this means that the "mode of production" dictates the form each society will take. It is this idea that brings Marxists to believe that the current capacity to produce means human beings can move beyond the conflicts of Class society.
Dialectical materialism is the idea that the history of humans is the history of conflict between classes. Different classes with different interests argue or fight each other. Social change is the result.
Many Marxists believe that there will always be revolts and, with the right conditions, revolutions. In these revolutions, the workers will fight the capitalists and will (eventually) win. During this process, they will set up a Socialist "workers' state" (a form of government that is the workers' themselves organised as the rulers of society) that will serve as a temporary state (the state, Marxists believe, is an organisation of one class to suppress another class, the Socialist state is created to suppress the Capitalist Class or what they call the exploiting class) until all capitalist-countries have been defeated and all classes have been abolished. Marxists believe that if the working class makes itself the ruling class and destroys the objective basis for class society (private property, or what Marx called "Bourgeois Property," relations) there will be a "classless society" - a society where no social groups are in conflict and there is no government anymore, and the state will be dismantled, organically, and it will be a borderless world with world-wide communes and worker-organisation of production based on needs instead of profits.