WEBVTT NOTE Marx and the Organization of Labor Under Socialism 1 00:00:00.000 --> 00:00:10.000 The topic and the paper that I have chosen today, namely the organization of labor under socialism and what Marx and Engels had to say about it. 2 00:00:10.000 --> 00:00:23.000 Two reasons. The first is that Marx and Engels were not only critics of capitalism, but they were also proponents of socialism. 3 00:00:23.000 --> 00:00:46.000 and we must be alive too, we must be critical of, we must be evaluating not only the vast bulk of their work, which was criticism of capitalism, but we must as well be criticizing and looking at what they had to say about the socialist society that they foresaw. 4 00:00:46.000 --> 00:00:50.000 What about the account of socialism that they give us? 5 00:00:50.000 --> 00:01:06.000 So, since Marxian Socialism says that it will bring the emancipation of the working class, let's look at what Marx is offering to the working class, to the industrial proletariat. 6 00:01:06.000 --> 00:01:12.000 What exactly are they supposed to get out of it, especially in the workplace? 7 00:01:12.000 --> 00:01:20.000 And what criticisms can we offer about socialism in the workplace as they present it? 8 00:01:20.000 --> 00:01:27.000 Now, this topic brings together a number of areas that have interested me for a long time. 9 00:01:27.000 --> 00:01:35.000 I've written in the past about division of labor and the thought of Plato and Rousseau. 10 00:01:35.000 --> 00:01:43.000 I've been interested in organizational matters with regard to various theoretical figures in Marxist movement. 11 00:01:43.000 --> 00:01:48.000 I've also, in the past, delivered talks on Marxism. 12 00:01:48.000 --> 00:01:57.000 And about a decade ago, I gave several summer seminars on the topic of Marx and Marxism. 13 00:01:57.000 --> 00:02:13.000 And in the course of it, I received comments from colleagues and discovered that there are differences or it emphasized to me that there are differences in how people look at what socialism would be like in the workplace. 14 00:02:13.000 --> 00:02:31.500 Some people see Marx as foreseeing, as portraying a liberated, undisciplined, unstructured workplace, indeed an almost bucolic, rustic utopia of some sort. 15 00:02:31.500 --> 00:02:42.500 They tend to emphasize Marx's remarks in his early work, The German Ideology, where he speaks about doing one thing today and another tomorrow. 16 00:02:42.500 --> 00:02:48.540 where he speaks in a single day of hunting in the morning, fishing in the afternoon, 17 00:02:48.540 --> 00:02:55.140 raising cattle in the evening, and engaging in literary criticism after dinner 18 00:02:55.140 --> 00:02:59.260 without at any time becoming, in a professional sense, 19 00:02:59.260 --> 00:03:05.660 some sort of hunter by profession or fisherman by profession or literary critic or so forth. 20 00:03:05.660 --> 00:03:11.740 And these scholars who think along these lines stress also remarks of Marx and Engels 21 00:03:11.740 --> 00:03:23.500 about freely associated producers, free associations of producers being what the situation would be in the workplace. 22 00:03:23.500 --> 00:03:30.700 Now, on the other hand, there were other scholars and I, at the time I was giving these seminars, 23 00:03:30.700 --> 00:03:36.700 I counted myself among them and these point to passages in these scholars have a different emphasis 24 00:03:36.700 --> 00:03:43.540 and point to passages in the Communist Manifesto, where Marx talks about labor armies 25 00:03:43.540 --> 00:03:48.860 and giving a sense of military discipline and structure in the workplace. 26 00:03:48.860 --> 00:03:58.620 These scholars would also point to and emphasize Engels' remarks in polemics that he had with a communistic anarchist at the time, 27 00:03:58.620 --> 00:04:08.700 where Engels talks about the discipline of factory life, the discipline of work with large-scale machinery and so forth. 28 00:04:08.700 --> 00:04:19.500 So this is a highly unliberated, a highly structured locale that Marx and Engels portray in these passages. 29 00:04:19.500 --> 00:04:25.760 And Lenin, I think, is following Marx when in Lenin's famous work, The State and Revolution, 30 00:04:25.760 --> 00:04:31.520 Lenin says, we want a socialist revolution with human nature as it is now. 31 00:04:31.520 --> 00:04:40.320 Human nature that cannot dispense with subordination, with control, with managers. 32 00:04:40.320 --> 00:04:49.720 This Lenin here is talking about the marks of discipline, the marks of authority. 33 00:04:49.720 --> 00:04:59.800 Now, we have to ask ourselves in the light of these two contrasting portraits of what Marx might foresee in the workplace of socialism. 34 00:04:59.800 --> 00:05:05.160 Do we have one set of scholars who is just completely right and the other wrong? 35 00:05:05.160 --> 00:05:13.160 Were Marx and Engels confused, baffled, inconsistent themselves? 36 00:05:13.160 --> 00:05:15.500 What exactly is going on here? 37 00:05:15.500 --> 00:05:19.380 And this is the topic I have set to explore in the paper. 38 00:05:20.800 --> 00:05:24.940 I think we need to set in our own minds clearly 39 00:05:24.940 --> 00:05:27.720 at the outset what socialism is 40 00:05:27.720 --> 00:05:29.780 when Marx and Engels are talking about it. 41 00:05:32.000 --> 00:05:34.200 And I'm going to sketch that for you briefly. 42 00:05:36.120 --> 00:05:41.120 It is clearly the end of production or exchange 43 00:05:41.120 --> 00:05:47.440 for exchange that is production for sale or barter in the marketplace. 44 00:05:47.440 --> 00:05:56.160 There's to be no exchange whatsoever of this commercial sort between individuals or firms at all. 45 00:05:56.160 --> 00:06:01.520 There is to be no money whatsoever, no medium of exchange either. 46 00:06:01.520 --> 00:06:08.120 There is to be no private property and assets, no private property and resources. 47 00:06:08.120 --> 00:06:16.640 And as a consequence, Marx believes there will be no business cycles, no depressions and recessions, no booms and busts. 48 00:06:16.640 --> 00:06:22.200 And as a consequence, he also thinks there will be no alienation. 49 00:06:22.200 --> 00:06:27.960 What alienation is, is a very complex subject that I don't really have the time to get into. 50 00:06:27.960 --> 00:06:32.880 It might come up in the panel or in questions and things like that. 51 00:06:32.880 --> 00:06:46.680 But to give you some sense of it, Marx sees the market itself as a kind of alien force that exists outside of human beings, external to them. 52 00:06:46.680 --> 00:06:51.600 They're not knowledgeable about its origins, its extent, the way it works. 53 00:06:51.600 --> 00:06:53.200 They can't control it. 54 00:06:53.200 --> 00:07:01.440 And somehow, through the next feature that I'm going to mention, they're going to bring it under control in socialism. 55 00:07:01.440 --> 00:07:05.360 and that is through central planning. 56 00:07:05.360 --> 00:07:13.320 Now, what this means is there's not going to be planning through a highly hampered market, 57 00:07:13.320 --> 00:07:17.400 such as you see in Russia or China, but planning in natural terms, 58 00:07:17.400 --> 00:07:22.600 planning without money or market information of any sort. 59 00:07:22.600 --> 00:07:26.360 Engel says, for example, that under socialism, 60 00:07:26.360 --> 00:07:33.200 Conscious organization on a planned basis will replace anarchy in social production. 61 00:07:33.200 --> 00:07:41.960 Likewise, Marx speaks of a society organized as a conscious and planned association. 62 00:07:41.960 --> 00:07:49.560 And Marx writes that the life process of society, which he says is based on the process of material production, 63 00:07:49.560 --> 00:07:51.800 does not tear off its mystic veil. 64 00:07:51.800 --> 00:07:55.400 That is to say, we can't really understand it. 65 00:07:55.400 --> 00:07:59.540 We cannot get at its real essence until, 66 00:07:59.540 --> 00:08:01.960 and we cannot end alienation as a consequence, 67 00:08:01.960 --> 00:08:06.320 until freely associated men do the producing 68 00:08:06.320 --> 00:08:09.840 and until these men regulate productive activities, 69 00:08:09.840 --> 00:08:13.120 quote, in accordance with a settled plan. 70 00:08:14.680 --> 00:08:17.360 Now, some of these phrases we should take apart 71 00:08:17.360 --> 00:08:18.200 and look at. 72 00:08:18.200 --> 00:08:43.200 Freely Associated Men, by freely we mean in Marx, not freedom in some classical liberal or libertarian sense, but rather as Paul Craig Roberts and Matthew Stevenson have correctly pointed out, freedom in control over external nature, 73 00:08:43.200 --> 00:09:02.040 freedom in control over ourselves in a sense of rational planning by the state going on, and freedom that's based on a kind of knowledge and understanding of social necessity and essentially social science sorts of knowledge. 74 00:09:02.040 --> 00:09:11.360 Freedom, thus, for Marx and Engels is a kind of mastery of one's fate over natural and social forces. 75 00:09:11.360 --> 00:09:16.360 Now associated means to an extent it's pointing to the fact 76 00:09:18.280 --> 00:09:22.260 that people are not independent autonomous agents out there, 77 00:09:22.260 --> 00:09:25.560 but are dependent and integrated 78 00:09:25.560 --> 00:09:27.840 in their interaction with one another. 79 00:09:27.840 --> 00:09:30.960 And this is true enough, but I'm going to mention 80 00:09:30.960 --> 00:09:34.760 as I go through this paper, how he sees this. 81 00:09:34.760 --> 00:09:36.560 And I'm going to point to some metaphors 82 00:09:36.560 --> 00:09:39.100 and models that Marx and Engels draw on, 83 00:09:39.100 --> 00:09:43.800 metaphors of the military, metaphors of producers cooperatives, 84 00:09:43.800 --> 00:09:47.860 metaphors of factory life or organization of firms. 85 00:09:52.740 --> 00:09:57.440 So that will give you some sense of what socialism is 86 00:09:57.440 --> 00:09:59.740 when Marx and Engels are talking about it. 87 00:10:01.120 --> 00:10:04.100 Now, why won't socialism work? 88 00:10:05.500 --> 00:10:08.140 I don't wanna go into this in great detail. 89 00:10:08.140 --> 00:10:11.940 Some of the other speakers are gonna be bringing up some of this. 90 00:10:11.940 --> 00:10:14.740 It's not the main thrust of my paper. 91 00:10:14.740 --> 00:10:18.980 And Lew Rockwell in his opening remarks 92 00:10:18.980 --> 00:10:23.460 gave you some summary of what Mises's critique was. 93 00:10:23.460 --> 00:10:25.860 And my critique, following as well 94 00:10:25.860 --> 00:10:28.580 along the lines of Mises and Hayek, 95 00:10:28.580 --> 00:10:31.260 concentrates on four areas 96 00:10:31.260 --> 00:10:34.660 that I'll just very briefly mention to you, 97 00:10:34.660 --> 00:10:36.500 why socialism won't work. 98 00:10:36.500 --> 00:10:40.580 First of all, because of the problem of property rights 99 00:10:40.580 --> 00:10:43.220 and the incentives that are not present 100 00:10:43.220 --> 00:10:45.740 or the disincentives that are there 101 00:10:45.740 --> 00:10:50.080 when property rights are gotten rid of 102 00:10:50.080 --> 00:10:53.180 or are so severely hampered and regulated 103 00:10:53.180 --> 00:10:57.180 as they are in practice in existing socialist societies. 104 00:10:57.180 --> 00:11:00.580 So socialist managers are gonna have the wrong incentives 105 00:11:00.580 --> 00:11:02.420 and they can't have the right incentives 106 00:11:02.420 --> 00:11:04.420 unless there are property rights there. 107 00:11:04.420 --> 00:11:09.420 the incentives to act so that resources are efficiently used. 108 00:11:10.420 --> 00:11:14.060 The second problem is the problem of complexity of information. 109 00:11:14.060 --> 00:11:17.140 They can't gather the information that they need to have 110 00:11:17.140 --> 00:11:18.980 in order to plan the economy. 111 00:11:18.980 --> 00:11:20.700 They can't grasp that information 112 00:11:20.700 --> 00:11:23.120 even if they could get a lot of it together 113 00:11:23.120 --> 00:11:24.860 and they can't use it effectively 114 00:11:24.860 --> 00:11:27.620 in the way that a capitalist entrepreneur 115 00:11:27.620 --> 00:11:28.960 might be able to do so. 116 00:11:29.880 --> 00:11:32.820 Then there's some problems of knowledge itself. 117 00:11:32.820 --> 00:11:36.620 The kind of knowledge that's needed to make an economy run, 118 00:11:36.620 --> 00:11:38.700 often lies in the hands of people 119 00:11:38.700 --> 00:11:40.460 who are operating in the market. 120 00:11:40.460 --> 00:11:43.860 They develop a kind of lay of the land knowledge 121 00:11:43.860 --> 00:11:47.660 that can't be present to a central planner. 122 00:11:47.660 --> 00:11:49.300 And lastly, there's a problem 123 00:11:49.300 --> 00:11:51.940 that you might term the totalitarian problem. 124 00:11:51.940 --> 00:11:55.740 Namely, if you put a lot of power in the hands of people 125 00:11:55.740 --> 00:11:58.300 and tell them they can tell everybody in the society 126 00:11:58.300 --> 00:11:59.960 what to do with their lives, 127 00:11:59.960 --> 00:12:14.960 They tend to run away with that power and you can't really check it if they're going to really have the job, the function, the charge of running the economy. 128 00:12:14.960 --> 00:12:18.960 And so you're setting yourself up for a tyranny, a despotism. 129 00:12:18.960 --> 00:12:28.960 And that is the essential core criticism that has to be made of the socialist utopia that Marx and Engels suggest. 130 00:12:28.960 --> 00:12:38.880 So the result is, the sum of all this, is that Marx's proposal, namely a moneyless 131 00:12:38.880 --> 00:12:47.000 planned economy, is impossible, as Mises shows, and the countries that call 132 00:12:47.000 --> 00:12:51.360 themselves socialists today, the really existing socialist societies as they're 133 00:12:51.360 --> 00:12:57.040 called, are ultra interventionist economies, that is to say they're kind 134 00:12:57.040 --> 00:12:59.120 of Super-Fascism. 135 00:12:59.120 --> 00:13:02.640 They have a hopelessly hampered market. 136 00:13:02.640 --> 00:13:05.260 They still have money of some sort, 137 00:13:05.260 --> 00:13:07.440 even though Marx promised that that would go. 138 00:13:07.440 --> 00:13:10.280 They still have labor markets of a sort. 139 00:13:10.280 --> 00:13:12.920 They very much reliant on private plots 140 00:13:12.920 --> 00:13:15.800 and agriculture to support them with food. 141 00:13:15.800 --> 00:13:20.800 They require black markets, both in manufacturing and farming. 142 00:13:21.120 --> 00:13:24.180 And they need the international prices 143 00:13:24.180 --> 00:13:25.920 of the capitalist market 144 00:13:25.920 --> 00:13:28.600 in order to even figure out what's going on 145 00:13:28.600 --> 00:13:32.720 and what relative values are of any sort. 146 00:13:32.720 --> 00:13:37.720 So that's socialism and what's wrong with it in a nutshell. 147 00:13:39.320 --> 00:13:42.440 I'm gonna outline for you now what I'm gonna talk about 148 00:13:42.440 --> 00:13:45.420 in terms of the organization of labor itself. 149 00:13:46.520 --> 00:13:49.880 I think to see what Marx and Engels foresaw 150 00:13:49.880 --> 00:13:53.760 for working men and women under socialism, 151 00:13:53.760 --> 00:13:55.320 we have to look at several matters. 152 00:13:55.320 --> 00:14:00.720 We have to look at authority and discipline in the workplace. 153 00:14:01.800 --> 00:14:06.120 We have to look secondly at the division of labor. 154 00:14:06.120 --> 00:14:10.320 What is Marx proposed to do about the division of labor, 155 00:14:10.320 --> 00:14:12.960 a subject that he offers many criticisms 156 00:14:12.960 --> 00:14:16.980 that vary across the course of his intellectual career. 157 00:14:16.980 --> 00:14:19.920 We have to look at the payment for work. 158 00:14:19.920 --> 00:14:24.280 Thirdly, the compensation that people have, 159 00:14:24.280 --> 00:14:26.280 and the income that they will have. 160 00:14:26.280 --> 00:14:29.780 Fourthly, I think we need to look at labor mobility. 161 00:14:29.780 --> 00:14:33.880 Can people choose their occupation? 162 00:14:33.880 --> 00:14:38.560 Can they move from one work setting to another and so forth? 163 00:14:38.560 --> 00:14:40.200 I think in the case of Marx and Engels, 164 00:14:40.200 --> 00:14:42.760 we have to look at an additional matter 165 00:14:42.760 --> 00:14:44.980 that's related in different ways 166 00:14:44.980 --> 00:14:47.360 to all of these things I've listed so far, 167 00:14:47.360 --> 00:14:50.160 namely the setting in the countryside, 168 00:14:50.160 --> 00:14:54.280 the setting in the city, changes that Marx proposes in this, 169 00:14:54.280 --> 00:14:57.560 what criticisms do we have of them and so forth. 170 00:14:57.560 --> 00:15:00.920 And then I will briefly look at these models that I mentioned, 171 00:15:00.920 --> 00:15:05.480 namely producers cooperatives, factories, firms 172 00:15:05.480 --> 00:15:08.840 and the military for what his view is 173 00:15:08.840 --> 00:15:12.880 of the associated life that people would experience 174 00:15:12.880 --> 00:15:13.960 in the workplace. 175 00:15:13.960 --> 00:15:39.960 Okay, now I'm going to argue that Marx does not really see a liberated 1960s unstructured life for the worker in the workplace under Socialism. 176 00:15:39.960 --> 00:15:55.960 He says it's going to be necessary under socialism to regulate labor time, how it's used, where it's allocated, and that means the people whose labor time we're talking about here. 177 00:15:55.960 --> 00:16:01.960 He's going to have to distribute, he says, labor time among various production groups. 178 00:16:01.960 --> 00:16:08.600 Groups. That means distribute people, send people, assign people where they're going to be going. 179 00:16:08.600 --> 00:16:19.520 It says within the workshop, the iron law of proportionality is going to subject different 180 00:16:19.520 --> 00:16:27.600 numbers of work people to different functions. So we're talking about here the impact of planning 181 00:16:27.600 --> 00:16:32.400 and a Planned Economy itself on the lives of working men and women. 182 00:16:34.440 --> 00:16:39.240 And Engels, I think, went most explicitly into this. 183 00:16:39.240 --> 00:16:42.740 If people want a discussion of some sort, 184 00:16:42.740 --> 00:16:45.480 we can talk about whether there is perhaps a difference 185 00:16:45.480 --> 00:16:47.520 between Marx and Engels on this issue. 186 00:16:47.520 --> 00:16:48.760 I don't think there is. 187 00:16:49.880 --> 00:16:53.760 Engels in his polemics with various communist anarchists 188 00:16:53.760 --> 00:17:11.760 asks them, how are they going to propose to run a ship, to run a factory, to run a railroad, without having some sort of deciding will, without having some sort of single management? 189 00:17:11.760 --> 00:17:15.760 He says these communist anarchists do not tell us their answer. 190 00:17:15.760 --> 00:17:27.760 And in a longer polemic, he proposes a hypothetical. He asks us to imagine, he asks us to bring up in our own minds the following. 191 00:17:27.760 --> 00:17:37.760 Suppose that the socialist revolution has been successful. Suppose that the capitalists have been dispossessed. 192 00:17:37.760 --> 00:17:46.760 Can you have organization without authority? 193 00:17:46.760 --> 00:17:53.760 Can you have, given that the work of modern industry is complex, 194 00:17:53.760 --> 00:17:56.760 given that it involves organized life, 195 00:17:56.760 --> 00:18:03.760 can you have organization and complexity of this sort without authority? 196 00:18:03.760 --> 00:18:32.760 Now, I just, as an aside, mentioned that as Misesians, we can say in a sense, yes, to the extent that the market is a kind of organization that doesn't have this sort of authority in its process and in the sense that prices bring about a kind of organization without authority in the sense that Marx and Engels are talking about. 197 00:18:32.760 --> 00:18:35.720 but to continue with their hypothetical. 198 00:18:37.680 --> 00:18:40.760 Engels takes the case of a cotton mill. 199 00:18:40.760 --> 00:18:44.440 He says the machinery of the cotton mill has requirements. 200 00:18:44.440 --> 00:18:48.720 People have to be there to oil it, to turn it on and so forth. 201 00:18:48.720 --> 00:18:52.040 Decisions have to be made if things are breaking down 202 00:18:52.040 --> 00:18:56.280 or as to whether certain cloth is coming out 203 00:18:56.280 --> 00:18:59.480 at the quality that people want and so forth. 204 00:18:59.480 --> 00:19:02.160 Workers have to show up at various times 205 00:19:02.160 --> 00:19:03.840 in order to operate the machinery, 206 00:19:03.840 --> 00:19:05.440 enough of them have to show up 207 00:19:05.440 --> 00:19:07.520 in order that there'd be a compliment of work 208 00:19:07.520 --> 00:19:09.900 that will make it operate properly. 209 00:19:09.900 --> 00:19:14.900 Engel says that one may write on the gates of the factory, 210 00:19:17.040 --> 00:19:21.620 abandon all autonomy, ye who enter here. 211 00:19:23.080 --> 00:19:28.080 For say, a rewriting of a famous Latin tag. 212 00:19:28.080 --> 00:19:57.080 but I think we can see that Engels is not offering the emancipated worker of socialism a free and easy liberated lifestyle in the factory and he goes on in discussing other examples such as railroads and ships on the high seas to state why he thinks that authority is necessary. 213 00:19:57.080 --> 00:20:27.080 The Theory of Money and Credit The Theory of Money and Credit 214 00:20:27.080 --> 00:20:57.080 And I think in many respects, if I may switch to another ideological movement, anyone who has experienced within the classical liberal or libertarian movement, persons who are anti-organization per se, who are decentralized in principle, who are devoted to autonomy above all else, sort of European greens, 215 00:20:57.080 --> 00:21:07.080 Green political movement transformed into America, know how exasperating this mentality that Engels is talking about can be. 216 00:21:07.080 --> 00:21:12.080 And some of you in the audience have had this experience or know about such people. 217 00:21:12.080 --> 00:21:24.080 And we could perhaps sympathize with Engels when he writes in exasperation that these autonomists must be fools or traitors. 218 00:21:24.080 --> 00:21:29.080 But I think we must stop short of embracing angles for important reasons. 219 00:21:29.080 --> 00:21:38.080 He has sociological insights, but I don't think that they should be embraced without some important caveats. 220 00:21:38.080 --> 00:21:48.080 He's framing his analysis in terms of authority, in terms of the sovereign will of managers, and in terms of subordination. 221 00:21:48.080 --> 00:22:18.080 And this strain in Marxian thinking was highly influential and in the time during the early Soviet experience when there was a debate over one-man management, Lenin is so moved and draws on this strain in Marx's thought so extensively that he begins praising political dictatorships and for their positive of the past, 222 00:22:18.080 --> 00:22:43.080 and the political dictatorships of the past for their positive contribution to human welfare and human well-being and I think we can see that that strain in Marxian thought has led to a certain comfort on the part of Marxian socialists with political dictatorships in socialist societies that operate in the name of Marx. 223 00:22:43.080 --> 00:22:54.080 Classical liberals, in contrast, do not embrace and deplore despotism. 224 00:22:54.080 --> 00:23:00.080 Classical liberals can discuss these same questions, these same cases that Engels brings up, 225 00:23:00.080 --> 00:23:09.080 such as cotton mills, ships on the high seas, railroads, in terms of concepts of property rights, 226 00:23:09.080 --> 00:23:15.080 In terms of contractual arrangements with clients, customers, employees, and so forth. 227 00:23:15.080 --> 00:23:26.080 Without terming everything in terms of political power relations as it seems Marx and Engels must do. 228 00:23:26.080 --> 00:23:35.080 Instead, classical liberals can talk in terms of human rights and contractual rights, 229 00:23:35.080 --> 00:24:05.080 So what happens in the workplace in a liberal society, in contrast to a socialist society, is constrained by property rights, by contractual arrangements, it's also constrained, of course, by serving the market, the fact that contractual arrangements are tested in and are serving the market, 230 00:24:05.080 --> 00:24:07.880 Clients, Customers and Employees. 231 00:24:09.040 --> 00:24:13.000 The manager cannot simply reorganize 232 00:24:13.000 --> 00:24:18.000 some workplace whimsically because of his authority 233 00:24:19.600 --> 00:24:22.200 to return to the concept that Marx and Engels 234 00:24:22.200 --> 00:24:24.120 are emphasizing here. 235 00:24:24.120 --> 00:24:26.360 If a manager in a liberal society, 236 00:24:26.360 --> 00:24:29.780 a capitalistic commercial society does so, 237 00:24:29.780 --> 00:24:32.580 that manager will end up having the firm go bankrupt. 238 00:24:35.080 --> 00:24:47.080 Now, Marx says that we have fundamentally two forms of social coordination, the market and planning. 239 00:24:47.080 --> 00:25:01.080 He says in the Grundrisse, if you rob money of its social power, you must give that power to persons to exercise over other persons. 240 00:25:01.080 --> 00:25:14.580 And I think in this passage, we really get a deep insight and a recognition that Marx himself realized that the choice is, as economist Gregory Grossman put it, 241 00:25:14.580 --> 00:25:24.080 between gold and the sword as what will run, as what will drive the economy and the society. 242 00:25:24.080 --> 00:25:38.720 Now Marx is going to argue that both gold, that is money, that is capitalism, that is the market, both gold and the sword, that is planning, that is the arm proletariat and so forth, 243 00:25:38.720 --> 00:25:54.720 That both of these are coercive according to Marx, but that the economy of gold is anarchic and that the sword, that the command economy is orderly, rational and productive. 244 00:25:54.720 --> 00:26:06.720 The Misesians, such as ourselves, are going to say, and I believe correctly, that the economy of gold is voluntary, that the sword is coercive, 245 00:26:06.720 --> 00:26:22.720 that the life of the sword is chaotic and disorderly and that gold can bring about order, rationality, peace and production. 246 00:26:22.720 --> 00:26:27.720 Now let me turn to the first of my topics, the division of labor. 247 00:26:27.720 --> 00:26:44.720 Now, I think that Marx here is misunderstood because people dwell too much on the very, very eloquent, powerful, so-called humanistic Marxist passages of his early days. 248 00:26:44.720 --> 00:26:52.720 And do not dwell enough on the subtle, reflective, mature Marx of capital. 249 00:26:52.720 --> 00:27:09.720 Now, I am not one who likes to make a radical split, a radical difference between the younger and older Marx, but I think as well with any writer who writes for a long time, 250 00:27:09.720 --> 00:27:17.720 who meditates on subjects such as this for a long time, you can see a definite evolution in Marx's thought. 251 00:27:17.720 --> 00:27:26.720 By the time he comes to his mature conclusions in Das Kapital, he distinguishes between three things. 252 00:27:26.720 --> 00:27:37.720 The social division of labor, in other words the occupations and jobs that need to be done and carried out in the economy and society. 253 00:27:37.720 --> 00:27:45.720 And the division of labor within the workplace. How exactly is the assembly line set up? 254 00:27:45.720 --> 00:28:00.720 where, you know, what is the secretary's job, what is the foreman's job, what is the person who turns the wrench that tightens the bolt, whatever, this sort of thing. 255 00:28:00.720 --> 00:28:07.020 So the division of labor in the workplace, he radically separates off, and he says these are different in kind. 256 00:28:07.020 --> 00:28:34.620 Now, this is in contrast to market economists, who I would say, since Adam Smith, would view the entire division of labor as of one piece, perhaps different in degree, but not different in kind, that the division of labor one sees in the factory or on the farm is a smaller scale version of the way labor gets divided throughout society. 257 00:28:34.620 --> 00:28:44.780 And the last thing that Marx is distinguishing is the mode of production that is capitalistic or socialistic on which the society operates. 258 00:28:44.780 --> 00:28:50.260 He would differentiate from the social division of labor itself. 259 00:28:50.260 --> 00:28:58.860 So the difference we see in the mature Marx is that the younger Marx conflated, brought together all these things. 260 00:28:58.860 --> 00:29:11.860 Socialism and the abolition of the division of labor, he grouped that together, together with abolition of private property, together with ending of alienation, together with a plan, no money and so forth. 261 00:29:11.860 --> 00:29:17.660 All of that almost became one thing or different facets of one thing. 262 00:29:17.660 --> 00:29:28.460 By the time he is a mature thinker, he has broken these out, made them more separate analytic concepts for him. 263 00:29:28.460 --> 00:29:44.460 In Das Kapital, in Capital, Marx contends that a social division of labor is a feature of all sorts of societies and indicates that he expects that it would as well be a feature of a socialist society. 264 00:29:44.460 --> 00:29:56.460 But the division of labor in the workplace that is found in capitalist factories, he says, is solely a feature of capitalist societies. 265 00:29:56.460 --> 00:30:03.000 I think Marx would have to be disappointed to learn that such a division of labor, of course, 266 00:30:03.000 --> 00:30:09.000 persists in the really existing socialist societies of our own present day. 267 00:30:09.000 --> 00:30:21.000 But getting back to what he dreamed, he believes that it is capitalistic production that makes for detailed work 268 00:30:21.000 --> 00:30:33.000 This is the sort of thing that Charlie Chaplin humorously Charlie Chaplin, of course, being a communist, humorously attacks in modern times the movie. 269 00:30:33.000 --> 00:30:50.000 So it is this detailed work of capitalist society that degrades and injures the worker physically and intellectually, according to Marx. 270 00:30:50.000 --> 00:30:58.840 Now there's going to be a difference as well in what the societal division of labor is under socialism as opposed to what it's been under capitalism. 271 00:30:58.840 --> 00:31:04.600 One is the consequence of the anarchy of the market, the anarchy of production under the market. 272 00:31:04.600 --> 00:31:14.000 Under socialism, the planners will be deciding what the occupations are, what the tasks are, what the jobs are that have to be accomplished. 273 00:31:14.000 --> 00:31:42.920 And as some have argued, particularly Roberts and Stevenson, two men I mentioned earlier, perhaps Marx and the Marxians plan to escape the effects of detailed work on the workforce by deliberately planning things so that workers rotate through various jobs or have jobs that have a variety of experience to them. 274 00:31:42.920 --> 00:32:12.920 I think there's something to this claim, this account that Roberts and Stevenson give, because indeed Marx speaks himself of how important change in activity is in pleasing the animal spirits of man, how this has been destroyed, this change in activity has been destroyed by the detailed work that capitalism mandates, he believes, and how socialism will bring back this change, this variety. 275 00:32:12.920 --> 00:32:37.920 Okay, let's talk about payment for work. In Volume 1 of Capital, Marx says that how distribution, how distribution of wealth, how distribution of income takes place under socialism is going to vary according to the level of economic development that a society has attained. 276 00:32:37.920 --> 00:32:50.920 He offers suggestion, namely labor vouchers in the period when full complete socialism, full complete communism has not yet been attained. 277 00:32:50.920 --> 00:33:00.920 There are going to be labor time vouchers that are going to allow people to collect according to the labor time that they have put in. 278 00:33:00.920 --> 00:33:09.280 in. And this of course, this labor planning itself will be centrally planned by the central 279 00:33:09.280 --> 00:33:15.800 planners who are going to apportion labor time in order to make sure that various proportionalities 280 00:33:15.800 --> 00:33:20.960 are there. This is mostly mumbo jumbo since we think it cannot be done and I think we've 281 00:33:20.960 --> 00:33:27.640 seen in the various attempts, especially the so-called war communist period in the early 282 00:33:27.640 --> 00:33:34.740 History of the Soviet Union to try it. 283 00:33:34.740 --> 00:33:39.960 When they do reach the final higher, more abundant phase of communism, they're going 284 00:33:39.960 --> 00:33:49.280 to give people access to consumer goods according to what I think is a rather problematical 285 00:33:49.280 --> 00:33:56.640 standard people's needs, but that is not the situation that he proclaims in the early 286 00:33:56.640 --> 00:34:03.800 Period of Socialism. It's not money. These labor vouchers will not circulate. And I think 287 00:34:03.800 --> 00:34:10.120 we know from Mises' own criticism that without money, this proposal of Marx's will simply 288 00:34:10.120 --> 00:34:14.800 be a catastrophe. And we know from the history of the Soviet Union, when they attempted a 289 00:34:14.800 --> 00:34:20.840 moneyless catastrophe economy, they had famine, they had a complete lack of industrial goods, 290 00:34:20.840 --> 00:34:38.840 and they had to revert in the new economic period in 1921 to a partial reintroduction of hampered prices, of a hampered use of money, of a hampered market, but no longer what Marx proclaimed what socialism would bring. 291 00:34:38.840 --> 00:34:42.840 Let me talk about labor mobility. 292 00:34:42.840 --> 00:34:54.840 Now, I think we have to understand here we're talking about occupational choice, moving from one job to another and so forth. 293 00:34:54.840 --> 00:35:04.840 The view of Marx and his followers in the golden age of Marxism, so-called, that followed immediately after his death, 294 00:35:04.840 --> 00:35:17.840 was that genuine full-fledged freedom of labor, freedom of occupational choice had vanished with the disappearance of craftsmen and independent farmers. 295 00:35:17.840 --> 00:35:26.840 Independent farmers haven't yet disappeared. To some extent, craftsmen are coming back, but that's just sort of an empirical aside. 296 00:35:26.840 --> 00:35:38.840 Full freedom of labor, according to these Marxists, is incompatible with organized, cooperative, productive endeavors, like industrial factories, large-scale farms, and so forth. 297 00:35:38.840 --> 00:35:44.840 Carl Kautsky, who was the literary executor of Marx and Engels, writes, 298 00:35:44.840 --> 00:35:53.840 It is true that in one respect the working man does enjoy freedom under the capitalist system. 299 00:35:53.840 --> 00:36:01.840 If the work does not suit him, this is under capitalism, the work does not suit him in one factory, he is free to seek work in another. 300 00:36:01.840 --> 00:36:10.840 He can change his employer. In a socialist community where all the means of production are in a single hand, there is but one employer. 301 00:36:10.840 --> 00:36:20.840 To change is impossible. In this respect, the wage earner today has a certain freedom in comparison with the worker in a socialist society. 302 00:36:20.840 --> 00:36:30.840 Now, Cotsky dismisses this loss of freedom as merely the loss of the freedom to choose one's master. 303 00:36:30.840 --> 00:36:46.840 Bukharin, an important early Bolshevik leader who was executed by Stalin and has been rehabilitated recently, also follows Cotsky in this in dismissing this loss of freedom. 304 00:36:46.840 --> 00:36:58.840 He says, in fact, that compulsory labor service and state assignments of workers to jobs is indicative of the organizational success and stability of proletarian rule. 305 00:36:58.840 --> 00:37:10.840 Trotsky, I think, is the most eloquent in this regard in bringing out the effects of this control over employment on the lives of workers. 306 00:37:10.840 --> 00:37:19.840 Trotsky says, when we say to the Turner, that's kind of a job, Ivanov, which is Smith in Russian, just a common name, 307 00:37:19.840 --> 00:37:27.840 You are bound at once to work at the Sormovo factory. If you refuse, you will not receive your ration. 308 00:37:27.840 --> 00:37:33.840 You cannot go to another factory, for all factories are in the hands of the state. 309 00:37:33.840 --> 00:37:44.840 In other words, for the working man, under the socialism of the future and under the socialism of really existing socialist societies, 310 00:37:44.840 --> 00:37:50.840 It's obey or starve. That is what emancipation of the worker amounts to. 311 00:37:50.840 --> 00:38:03.840 Now what about town and country? Marx was one of the most anti-peasant thinkers in human history. 312 00:38:03.840 --> 00:38:10.840 He did not see peasants or small holdings as anyway fitting with the course of progress. 313 00:38:10.840 --> 00:38:15.240 They were standing a fort in the course of progress. 314 00:38:15.240 --> 00:38:19.540 He saw the development of society as overwhelming there. 315 00:38:19.540 --> 00:38:27.440 He believed that the march of capitalism itself was overcoming what he called the idiocy of rural life. 316 00:38:27.440 --> 00:38:34.040 A phrase that the Bolsheviks themselves were to make much use of 317 00:38:34.040 --> 00:38:43.040 as they themselves went after the peasants with sword and fire. 318 00:38:43.040 --> 00:38:51.040 Large-scale production, Marx and Engels believe, is now everywhere on history's agenda. 319 00:38:51.040 --> 00:39:00.040 And they believe wrongly that in their own time farm ownership was becoming increasingly concentrated. 320 00:39:00.040 --> 00:39:15.040 Marx in his Inaugural Address to the First International says that would the capitalist farmers please hurry up and gather all the lands into a few hands so that the agrarian question would be simplified for the socialist movement. 321 00:39:15.040 --> 00:39:26.040 August Bebel was to argue that small farmers were the most backward and therefore they should be the first to be expropriated. 322 00:39:26.040 --> 00:39:43.040 Indeed, in his The Woman and Socialism, Baebel argues that the social stratum of the small farmers are required by human progress to cease to exist. 323 00:39:43.040 --> 00:40:02.040 I think we can see that the liquidation of the kulaks as a class and Stalin's famine policy in the Ukraine in the 1930s are not exactly being called for directly here by these early Marxist theoreticians and politicians. 324 00:40:02.040 --> 00:40:18.040 But the ideological family resemblance between this Bolshevik mentality of famine and sword against the kulaks is implicit in the attitude that we see here in Bebel. 325 00:40:18.040 --> 00:40:22.040 The family resemblance is obvious. 326 00:40:22.040 --> 00:40:30.040 So in the communist manifesto, labor armies in the countryside, expropriation of the land of the farmers, 327 00:40:30.040 --> 00:40:47.040 Centrally Planned Agriculture, fusing of manufacturing and agricultural activities, and a planned mandatory abolition of differences through time, gradually over time, between the countryside and the town. 328 00:40:47.040 --> 00:40:52.040 And I am running out of time. 329 00:40:52.040 --> 00:40:58.040 A few words about some of these models, and then I will sum up. 330 00:40:58.040 --> 00:41:15.040 The cooperative model, producer's cooperatives, I don't think that the sense that some have that Marx favored some sort of enterprise level cooperatives being the most important unit in the economy is at all correct. 331 00:41:15.040 --> 00:41:27.040 Marx makes very clear that cooperatives, he's talking about a cooperative commonwealth, a completely nation level cooperative, which makes no sense. 332 00:41:27.040 --> 00:41:36.040 When you're talking about expanding the notion of a co-op to a national level, you're not talking about a voluntary economic unit anymore. 333 00:41:36.040 --> 00:41:40.040 You're talking about a planned state-like operation. 334 00:41:40.040 --> 00:41:56.040 He indeed says that this cooperative life has to be fostered and sustained by the state, and it's really a metaphor and something he plans to have brought under a common plan and so forth. 335 00:41:56.040 --> 00:42:19.040 It's one big giant cooperative and as a result all the problems that Mises brings out about planning, about economic calculation and so forth are going to come into place because there's not going to be a market for assets, for resources, there's going to be one big planning unit. 336 00:42:19.040 --> 00:42:27.040 So any sense of enterprise level cooperatives, you should be disabused of that as what Marx foresees for the workers. 337 00:42:27.040 --> 00:42:38.040 The factory or firm model. Now, Marx says that all of society, all of the economy should become like one giant factory. 338 00:42:38.040 --> 00:42:48.040 He foresees under socialism one commanding will, like that of the conductor of an orchestra, he says, guiding the economy. 339 00:42:48.040 --> 00:43:03.040 An economy that will consist not of fragmentary operations, but rather of the combined labor of a single workshop, extended to the national scale. 340 00:43:03.040 --> 00:43:10.040 Marx believed erroneously that somehow we could abstract from the situation of a firm within the market 341 00:43:10.040 --> 00:43:21.040 and carry factory-style planning and management that are indeed dictated by the circumstances on the market out into the entire economy and society. 342 00:43:21.040 --> 00:43:32.040 And this is what the famous phrase, the administration of things that Marx talks about refers to. 343 00:43:32.040 --> 00:43:53.040 I think here I need to mention that this model of the firm or the factory is where Marx takes his notion that he can solve the problem that he sees of degradation of the laborer's life in detail work. 344 00:43:53.040 --> 00:43:58.000 or he can solve it because he looks at a factory or firm 345 00:43:58.000 --> 00:44:02.100 where a manager can move people from one job to another 346 00:44:02.100 --> 00:44:04.680 or say, well, you spent part of the day doing this, 347 00:44:04.680 --> 00:44:06.240 now go do that. 348 00:44:06.240 --> 00:44:08.240 And since he sees the whole society 349 00:44:08.240 --> 00:44:10.360 and the whole economy in this way, 350 00:44:10.360 --> 00:44:14.560 he thinks that he can in this manner introduce job rotation 351 00:44:14.560 --> 00:44:17.000 and variation into the lives of workers. 352 00:44:17.000 --> 00:44:40.000 To some extent, I think we have to realize where this project of job rotation is going to take the Marxists. 353 00:44:40.000 --> 00:44:49.000 They're going to be moving people mandatorily from the shop floor into administration and back and forth. 354 00:44:49.000 --> 00:44:58.000 I think there are going to be serious problems with that in terms of talents that are there in the workforce and so forth, 355 00:44:58.000 --> 00:45:04.000 whether this will work over a long-term basis, whether the iron law of oligarchy will come in 356 00:45:04.000 --> 00:45:10.400 and block such shifting back and forth from administration into subordination. 357 00:45:10.400 --> 00:45:19.700 He wants to require scientists and artists to engage in mandatory physical labor. 358 00:45:19.700 --> 00:45:28.100 He wants, if necessary, to compel each worker in society to perform undesirable dirty work in turn. 359 00:45:28.100 --> 00:45:42.100 Some of these suggestions, this last one is actually Mabel, not Marx, but it's in keeping with the spirit of Marx's desire to bring together manual and mental labor. 360 00:45:42.100 --> 00:45:58.100 I think here we can see the roots of the malice program of re-education of sending white collar workers, uppity urbanites, out to the countryside for rectification. 361 00:45:58.100 --> 00:46:28.100 And lastly in connection with this factory or firm model, I want to mention a sort of a humorous note and that is that the example that Lenin finds most appropriate in suggesting what kind of factory or firm he has in mind moving to the national scale when the armed proletariat takes control of the economy is he says the whole national economy needs to be run along the lines of 362 00:46:28.100 --> 00:46:31.100 of the Post Office. 363 00:46:31.100 --> 00:46:38.100 So there is humor if you know where to look for it in this material. 364 00:46:38.100 --> 00:46:49.100 I can't really go much into the military model, but I mentioned earlier that labor armies is something that Marx feels comfortable in talking about. 365 00:46:49.100 --> 00:47:00.100 Lenin is calling throughout the very early days of Bolshevism for universal labor conscription or general labor conscription. 366 00:47:00.100 --> 00:47:12.100 Trotsky indeed makes very plain that he sees it necessary to bring military discipline and structure and organization into such universal military conscription. 367 00:47:12.100 --> 00:47:38.100 Lenin, Trotsky, Bukharin, all see the grain appropriation via expropriation that they used during this period, the early period of Soviet history to get farm goods from the countryside into the city or from the countryside into the army. 368 00:47:38.100 --> 00:47:49.600 They see this continuing. They see this is an extension of military methods. They see this as staying on during peacetime and so forth. 369 00:47:49.600 --> 00:47:59.600 So there is very much an authoritarian military model built into the notion of association and organization of labor and the workplace. 370 00:47:59.600 --> 00:48:10.600 Let me just sum up by saying what the conclusion is that I have about life in the workplace for the worker under socialism. 371 00:48:10.600 --> 00:48:23.600 In authority, we keep the dictates of large machinery, we keep the manager as boss, although there's some hints at some sort of very vague hints by Marx, 372 00:48:23.600 --> 00:48:29.600 some sort of democratic oversight, which I think would be bound to be unsatisfactory. 373 00:48:29.600 --> 00:48:37.600 There's going to be central planning and no money, Marx says, and Marx says this is rational. 374 00:48:37.600 --> 00:48:42.600 Mises makes powerful, powerful arguments that it's impossible. 375 00:48:42.600 --> 00:48:48.600 The result, then, we see is military state capitalism, a kind of super fascism. 376 00:48:48.600 --> 00:49:10.600 The division of labor, it's going to remain, except for mandatory physical labor, plan, amalgamation of countryside and city, imposed scrambling of intellectual and manual work and so forth. 377 00:49:10.600 --> 00:49:20.600 Labor Mobility, there's going to be less of it, and there's going to be a complete loss of freedom to vote with one's feet from one job to another. 378 00:49:20.600 --> 00:49:26.600 I think the conclusion that we have to draw here is pretty bleak, even in Marx's own terms. 379 00:49:26.600 --> 00:49:30.600 Marx says he's bringing emancipation of the working class. 380 00:49:30.600 --> 00:49:45.600 and the Working Class. I say, Misesium say, he's bringing empowerment of the political bureaucratic class and insertment of the working class. Thank you very much.