the globalised world according to marx

The Age, 12 July, 1999


In the 1850s, Karl Marx believed that the spread of capitalism, or what today we would call globalisation, was transforming human society from a collection of separate nation-states to a world capitalist society where the principal form of conflict would be between classes rather than nations. According to Marx, the conflictual properties of capitalism could not be contained. A political revolution led by the working classes would overthrow the capitalist order and usher in a world socialist society free from the alienation, exploitation and estrangement produced by capitalist structures.

Needless to say, the pattern of historical change anticipated by Marx 150 years ago has been thwarted by the persistence of the nation-state system, its propensity for violence, and the grip that nationalism maintains upon our political identities. Marx's reputation has also been tarnished, perhaps unfairly, by the appalling interpretation and application of his ideas in a number of failed communist states.

So what, if anything of value, does Marx have to say about the current impact of globalisation upon advanced industrial societies such as Australia?

Marx was the first theorist to correctly identify capitalism as the principal driving force behind increasing levels of international interdependence, a process that he believed was both transforming human society and uniting the species. With remarkable prescience Marx argued that the very essence of capitalism is to "strive to tear down every barrier to intercourse", to "conquer the whole earth for its market" and to overcome the tyranny of distance by reducing "to a minimum the time spent in motion from one place to another".

Resistance to the expansion of capitalism was, according to Marx, futile. National economic planning would become impossible as barriers to trade and investment collapsed. In a famous extract from The Communist Manifesto, Marx and Engels describe how globalisation prizes open national economies and how global markets determine the pattern of economic development across the planet: "The bourgeoisie has through its exploitation of the world market given a cosmopolitan character to production and consumption in every country. ... All old established national industries have been destroyed or are daily being destroyed. They are dislodged by new industries, whose introduction becomes a life and death question for all civilised nations. ... In place of the old local and national seclusion and self-sufficiency, we have intercourse in every direction, universal inter-dependence of nations".

Globalisation, according to Marx, was a progressive, if transient phase in human history. The universalising processes inherent in capitalism promised to bring not only unprecedented levels of human freedom, but also an end to insularity and xenophobia. According to Marx and Engels, under globalisation "national one-sidedness and narrow-mindedness become more and more impossible. ... The bourgeoisie, by the rapid improvement of all instruments of production, by the immensely facilitated means of communication, draws all, even the most barbarian nations, into civilization. The cheap prices of its commodities are the heavy artillery with which it batters down all Chinese walls, with which it forces the barbarians' intensely obstinate hatred of foreigners to capitulate. It compels all nations, on pain of extinction, to adopt the bourgeois mode of production;... In one word, it creates a world after its own image".

However, unlike liberals who regard the collapse of national economic sovereignty as a positive development, Marx highlighted the darkside of interdependency, in particular the social consequences of exposure to the rigours of market life. In the 1840s, Marx was already observing a backlash against globalisation. People had "become more and more enslaved under a power alien to them (a pressure which they have conceived of as a dirty trick on the part of the so-called universal spirit, etc,), a power which has become more and more enormous and, in the last instance, turns out to be the world market".

Remarkably, Marx also anticipated the de-regulation of the world's capital markets in the 1970s and was convinced that the rapid and unrestricted flow of money across territorial boundaries would disrupt many societies and exacerbate class tensions within them. In 1848 he asked, "what is free trade under the present conditions of society? It is freedom of capital. When you have overthrown the few national barriers which still restrict the progress of capital, you will merely have given it complete freedom of action. ... All the destructive phenomena which unlimited competition gives rise to within one country, are reproduced in more gigantic proportions on the world market. It breaks up old nationalities and pushes the antagonism of the proletariat and the bourgeoisie to the extreme point".

Economist David Hale recently claimed that opposition to free trade in the US is "heavily influenced by perceptions that voters themselves now view trade issues in terms of a domestic class struggle, not as promoting exports and global integration". Marx wouldn't have been surprised. Although he was describing a world already being transformed by capitalism in the middle of last century, Marx's observations about the power of markets, class tensions and the emergence of a universal capitalist society resonate even more loudly today.