John Lanchester on Marx

Over the last few years, related to Whoops, his book on the economic crisis, John Lanchester has written in the London Review of Books some extremely interesting stuff on the economic crisis (we’ve discussed him here, here, and here). I’ve just come across a podcast and article by him from the LRB. The podcast is an hour long lecture, and I haven’t listened to it all, but the article seems to be the essence of the lecture, although there are some differences (a greater attack on the way modern economics works in the podcast for example).

The article is called Marx at 193, and is essentially about what Marx’s analysis of capitalism might or might not tell us about the world today. Lanchester condemns the failure of economists to seriously pursue the possibility of an alternative to capitalism in a post-Soviet world that has seen “the near terminal meltdown of the global economic system in 2008”, before going on to argue that

The financial system in its current condition poses an existential threat to Western democracy far exceeding any terrorist threat. No democracy has ever been destabilised by terrorism, but if the cashpoints stopped giving out money, it would be an event on a scale that would put the currently constituted democratic states at risk of collapse. And yet governments act as if there is very little they can do about it. They have the legal power to conscript us and send us to war, but they can’t address any fundamentals of the economic order. So it looks very much as if Marx’s omission of the word ‘capitalism’, because he foresaw no alternative within the existing social order, was an instance of his crystal ball functioning with particularly high resolution.

He offers a discussion of Marx’s views of what money is and where value comes from, before offering some discussion of how the theory of surplus value applies to the world of digital products.

When you start looking for this mechanism at work in the contemporary world you see it everywhere, often in the form of surplus value being created by you, the customer or client of a company. Online check-in and bag drop at airports, for example. Online check-in is a process which should genuinely increase the efficiency of the airport experience, thereby costing you less time: time you can spend doing other things, some of them economically useful to you. But what the airlines do is employ so few people to supervise the bag drop-off that there’s no time-saving at all for the customer. When you look, you see that because airlines have to employ more people to supervise the non-online-checked-in customers – otherwise the planes wouldn’t leave on time – the non-checked-in queues move far more quickly. They’re transferring their inefficiency to the customer, but what they’re also doing is transferring the labour to you and accumulating the surplus value themselves. It happens over and over again. Every time you deal with a phone menu or interactive voicemail service, you’re donating your surplus value to the people you’re dealing with. Marx’s model is constantly asking us to see the labour encoded in the things and transactions all around us.

Lanchester addresses the question of conditions for the proletariat in the developing world, using the example of the world’s richest company, Apple. He also says (a dodgy assumption we might think) that in the western world, the majority of the population is now bourgeois, dependent on the proletariat in the developing world.

Its bestselling products are made at factories owned by the Chinese company Foxconn. (Foxconn makes the Amazon Kindle, the Microsoft Xbox, the Sony PS3, and hundreds of other products with other companies’ names on the front – it’s not much of an exaggeration to say that it makes every electronic device in the world.) The company’s starting pay is $2 an hour, the workers live in dormitories of six or eight beds for which they are charged rent of $16 a month, their factory in Chengdu, where the iPad is made, runs 24 hours a day, employs 120,000 people – think about that, a factory the size of Exeter – and isn’t even Foxconn’s biggest plant: that’s in Shenzhen and employs 230,000 people, who work 12 hours a day, six days a week. The company’s answer to a recent scandal about suicide rates was to point out that the suicide rate among Foxconn employees is actually lower than the Chinese average, and that it turns away thousands of applicants for jobs every day, and both of those facts are true. That’s what’s really shocking. These conditions are equal to or better than most of the equivalent manufacturing jobs in China, where most of the world’s goods are made, and that life is widely seen among Chinese workers as preferable to the remaining alternatives of rural life.

He argues that this is close to the vision of the exploitation of the proletariat presented by Marx. Having praised Marx as a critic of capitalism, he moves on to critique Marx. He starts with class, arguing that Marx’s organised and conscious proletariat does not exist. He also states that what the Chinese call Mass Group Incidents (protests or riots by large numbers of unhappy people) have nothing to do with class, something which again we might wonder about. Lanchester argues that Marx, like everybody else, could not foresee the many different forms capitalism has taken in different countries. He argues that a single analysis for such a variety of forms may not work. He develops the argument that capitalists respond to pressures and do things against their own interests for reasons such as ethical demands in the west producing pay rises in China, or even philanthropy, that go against the profit motive. This is part of a broader argument about us having more complex and contradictory economic activity, e.g. as workers or as pensioners or potential pensioners, that Marx did not foresee.

Lanchester essentially argues that the reforms that have been instituted since Marx’s day and the developments in things like life expectancy disprove significant aspects of Marx’s analysis, regarding immiseration for example (there are of course questions over whether Lanchester has understood what Marx meant by immiseration). Marx also missed, he argues, that the massive productive capacity of capitalism he saw so clearly would reach a point where the entire system of capitalism itself became unsustainable. He gives the example of water usage – there simply isn’t enough fresh water in the world for everyone to use it at the level people do in the US.

His conclusion runs along the following lines

So the question is whether capitalism can evolve new forms, in the way it has so far managed to do, and come up with property and market-based mechanisms which deflect the seemingly inevitable crisis that will ensue, or whether we need some entirely different social and economic order. The irony is that this order might in many respects be like the one Marx imagined, even if he saw a different route to getting there.

An interesting article from Lanchester, then, as always. It raises some of the problems those of us on the Marx-inspired left face, even when dealing with sympathetic people. Class consciousness and class struggle are seen essentially as old hat, and the fact that they don’t exist today in the way Marx expected (or it could be argued we saw in the C20th) means that they won’t exist in the future. This, I think, is what Lanchester was talking about at the start of the article where he explained that he is an empiricist but Marx wasn’t. He doesn’t say There Is No Alternative, but you get the feeling that even though he talks of the need for one, he doesn’t know where to start setting about trying to create one, and is rather hoping than some form of eco-collectivism will emerge. There seems to be a lot of pessimism of the intellect going on. The article certainly belongs, it seems to me, to the school of thought that Marx got a lot right about capitalism, but not much right about what to do about it.

He argues too that the welfare state may well have caused Marx to rethink his entire model. Along with his argument about all the different forms of capitalisms in different countries, we can see that the article perhaps looks for points where it can disagree with Marx without considering possible counter-arguments – the underlying sameness of the varieties of capitalism (at least in the eyes of capitalists) for example, or a consideration of what role class conflict played in the creation of the welfare state, or its defence. In the pages of the LRB years ago, Perry Anderson talked about zones of resistance to the neo-liberal model, picking out Latin America in particular. Lanchester seems not to have thought outside the west and China and Singapore; which is surprising, given the prominence of the BRIC concept in the broader media.

Interesting stuff, reminding us how many assumptions based on current experience, TINA and the end of history that we have to combat if we are to make a Marx-inspired message for social change, as opposed to a Marx-inspired critique of capitalism) practical in the eyes of huge swathes of the population.