Owners of capital will stimulate the working class to buy more and more of expensive goods, houses and technology, pushing them to take more and more expensive credits, until their debt becomes unbearable. The unpaid debt will lead to bankruptcy of banks, which will have to be nationalised, and the State will have to take the road which will eventually lead to communism.
Karl Marx, Das Kapital, 1867
It's been fifteen years since I read Das Kapital, and I'm not sure how much I retained even when I was young and hale. But it immediately set off my fake alarms. First, because it doesn't sound remotely like anything I remember Marx saying--his core thesis was that falling wages would immiserate the working class, not that they'd be done in by their overdrafts. Second, because I do remember Marx spending huge chunks of Das Kapital grousing about the inadequacy of the housing supply for the working class, in very tedious detail. (I now appreciate, as I didn't then, how valuable this is as a historic record. But it's quite something to wade through.) And third, because no one in 1870 imagined the working class having access to bank credit. Poor people might get some time from the landlord, or a few weeks at the butcher, or they might run arrears and pay on account, but they did not buy substantial goods on credit. The first mass extension of credit to people who did not own land was the boom in installment buying that came in the 1920s.
Also, at least as I recall it, socialism was supposed to come 'round through violent revolution of the starving proletariat, not bank nationalisation. But as I say, it has been a long time.
Also, the quote just doesn't feel right--it doesn't sound like Marx. I can't put my finger on why, exactly, especially since I've only read Marx in translation. I can say that it feels, like most of these hoaxes, a little too a propos, as if Marx were writing from the CNN green room.
And indeed, searching all three volumes for "houses" and "homes", which are a pretty straight one-to-one translation, yields nothing that sounds remotely like this.
Every time I see one of these things, I wonder. Who the hell makes them up? And why? What do you get from passing your mediocre musings off as the work of a long-dead revolutionary?
"Sometimes I sing and dance around the house in my underwear. Doesn't make me Madonna. Never will." ~ Joan Cusack, Working Girl
I've never read any Marx, but the use of the word "technolgy," which has an exact German cognate, rings false to me for anything from the 19th century. Doubly so the notion of the working class buying anything that might have such a fancy name. Brass cartridges for breach loaders were high technology at the time, but who would have called them that?
Marx was a revolutionary?
I thought he was an academic/economist/historian.
Also, the word "technology" in that paragraph strikes me a suspicious. What sort of technology are working class folks supposed to be buying in 1867? Unless Marx foresaw the Atlantic's article on the Technivorm coffee maker. $400 cup of coffee, ummmmm.
I think you'll find that that's not Karl Marx, that's Chief Seattle.
Furthermore, "more and more of expensive goods" is an awkward phrase that is unlikely to be used by a professional translator.
Agree that it doesn't sound like Marx, but does sound similar to what some 20th century Marxists (iirc maybe Baran and Sweezy and some of their predecessors) wrote about the "sales effort" absorbing that portion of the surplus value of labor members of privileged classes (other than owners of capital) had managed to snag. Actually, I found some of the early to mid comments on the sales effort fairly perspicacious interms of later marketing practices. I've always wanted to write a book called "Marxism and Marketing" tracing out the similarities.
I second the above suspicions of the word "technology" used to describe consumer goods. Also the word "stimulate" as used here strikes me as totally anachronistic. I'm doubt Marx spent much time critiquing Keynesian economic theory.
And in rereading my first sentence above, I recognize that it sounds as if it were very badly translated from a German original replete with those long German words that include multiple nouns and adjectives.
That was actually Zeppo Marx
Yes, but Marx would now wish he had said it!
The reference to workers buying houses is a little surreal for the period too.
The very idea that the state takes a road which leads to communism is already anathema to Marx; the role of the workers as consumers is already post-Marx. I'm actually shocked that it would take you more than 10 seconds to recognize this as a hoax.
It didn't; it took me more than ten seconds to make sure I was right.
Assuming the quote is not from Marx and was recently fabricated, one has to wonder why it caught Wall Streeters attention; for it's a lovely little morality play.
It has the ring of prophesy:
Because it describes what's happened to the middle class, it seems to predict the current situation. This lends credence to the rest of rest of the quote:
This leads me to assume the Streeters the manufactured quote because it absolves them for direct blame for their culpability (inadequate capital to cover the amount of risk in the paper they were selling) of the current economic crisis, and predicts their salvation in the form of "socialist" help from the government.
It's just grownup version of "not me."
Google tells me this was legion on Serbian sites in December.
The only way it could sound phonier would be if it specifically mentioned the Wii.
I'm sure we ALL sing and dance around the house in our underwear (or at least those of us with no awkward housemates). But if you ever to that on your Wii Fit, definitely post it to YouTube, that viral girl can use the competition!
"It's been fifteen years since I read Das Kapital"
You are a better person than I for being able to wade through that drivel.
This isn't the slightest bit surprising. Think of how many bogus Jefferson, Hitler, and Stalin quotes are floating around the net. Jefferson when support is needed, the others to tar enemies. Not being the cynical type, I suspect most of them are the result of faulty memories instead of outright prevarication. But it's hard to imagine this one falls in that category.
Closer to home we have "It's just a goddamn piece of paper", which is supposed to have been said about the constitution by Bush, Cheney, or Rumsfeld (depending on the source). There's no evidence any of the three actually said it, though.
But my all-time favorite falsely attributed quotes are this one, which predates the internet, and this one (the first), which you see every-damn-where.
Thanks for that great Joan Cusak line!
And here I thought it was a traditional African proverb.
"FDR's line about nothing to fear but fear itself, for example, was lifted from Thoreau, without attribution." I attribute that to the Derb.
Wow, a Working Girl reference. Nice! Remember though, despite Joan Cusak's character's caution, Melanie Griffith's spunky Staten Islander character does fulfill her dreams of breaking into mergers & acquisitions.
Look, remember how many people passed on that passage about "the drums of war" under the impression that it was Shakespeare, because after all Barbra Streisand said so? Everyone wants more math and science education, but I'm not not at all sure that's our most significant deficit. An awful lot of Americans haven't acquired the sort of basic feel for language or for history that exposes these things as such obvious bull-pucky.
There are 10 things about this that ring false.
But what immediately set off my BS detector was the notion that Marx could ever say anything in one concise paragraph. Really...
See, even Marx though it was a short slippery slope from stimulous to communism.
Everyone wants more math and science education
...for others. Getting educated in math and hard sciences and tech involves a lot of hard work, unlike some fields I could mention. You know, those that attach importance to correct quote attribution.
dotdotdotMax, you're a moron. First, because you clearly don't know a thing about Megan's educational background, which is not in journalism and which undoubtedly includes quite a bit of math, and second because you apparently think that people whose academic backgrounds are in math and the hard sciences don't care about attributing a quote correctly.
Now, go change your handle and hope to live it down.
...Max...,
Dude, my own undergraduate degree was in mechanical engineering (at UC/Berkeley, which has a pretty decent reputation in that area). I'm not underplaying math and science education. I'm saying only that without some reading skills and some sense of history, we're flying blind.
And Charlie (Colorado) is right: Good scientists do not make stuff up and put it in other people's mouths, and are very irritated if others do so.
I'm not sure what the context is for that quote being passed around The Street. It is supposed to be cautionary I suppose. If so it is amazingly stupid.
The ownership of banks is not communism, it's socialism. Now one could posit that the government owned bank would set forth on a strategy of loaning money the poor and unworthy or apportion loans to silly liberal causes etc. etc. etc. and that this would distort the market. Setting aside the fact that the great Wall Street banks and financial corporations distorted the market and went bankrupt on their own and thank you very much but there is another point to make. That would be that there is more than one kind of socialism. Recall National Socialism. In it's more pure Italian form.
This is the operative model so far.
I note that you refer to Marx's magnum opus as Das Kapital. After an earlier career phase when I regularly read and abstracted Marxist social science journals, I came to automatically mistrust anyone who did that. My experience was that serious leftists who had read that book called it Capital, the English translation of the title, whereas right wingers characteristically called it by the German title, perhaps to mark it as foreign and unassimilable. Now, it's evident from what you actually say that you really have read the book in question (which is more than I can claim), but that stylistic quirk hung me up for a moment, so I wanted to remark on it.
I think this post would read better if the second quote were attributed to Das Kapital as well.
http://www.etymonline.com/index.php?term=technology
1859
Looks like it was just coming into use at that time, but had a distinct industrial meaning. Workers would have been using it in the factories but certainly not purchasing it.
That quote is total BS.
William Stoddard: You took the words right out of my mouth. I did my Ph.D. on Marx, and though the subject was not his economics but his theory of history, I did read the entire first volume of Capital. I have seldom, if ever, found any serious English-language scholar, or English-language translation, that referred to the work as Das Kapital -- it's always been Capital. Like you, I suspect the reason right-wingers and the news media call it "Das Kapital" is to make it sound foreign -- and even sinister.
Capital is a work of intellectual brilliance, whatever its flaws may be. And there is surely something to be said for an economist who, elsewhere, in explaining what he means by the difference between productive and unproductive labour, can write:
"Milton, for example, who did Paradise Lost, was an unproductive worker. In contrast to this, the writer who delivers hackwork for his publisher is a productive worker. Milton produced Paradise Lost in the way that a silkworm produces silk, as the expression of his own nature. Later on he sold the product for £5 and to that extent became a dealer in a commodity. But the Leipzig literary proletarian who produces books, e.g. compendia on political economy, at the instructions of his publisher is roughly speaking a productive worker, insofar as his production is subsumed under capital and only takes place for the purpose of the latter’s valorisation. A singer who sings like a bird is an unproductive worker. If she sells her singing for money, she is to that extent a wage labourer or a commodity dealer. But the same singer, when engaged by an entrepreneur who has her sing in order to make money, is a productive worker, for she directly produces capital. A schoolmaster who educates others is not a productive worker. But a schoolmaster who is engaged as a wage labourer in an institution along with others, in order through his labour to valorise the money of the entrepreneur of the knowledge-mongering institution, is a productive worker."
"In Africa, it takes a village to raise a child."
"In the US, one daycare worker raises 30 children, leaving the rest of the parents to get rich."
"In Soviet Russia, children raise you!"
Let us not downplay the importance of nutritional scientists.
"My experience was that serious leftists who had read that book called it Capital, the English translation of the title, whereas right wingers characteristically called it by the German title, perhaps to mark it as foreign and unassimilable."
Serious leftists spend a lot of time thinking about Marx, whereas the rest of us don't. To most English-speakers, Capital sounds vague (I've taught courses titled 'Capital Markets' and 'Venture Capital'; if I taught one titled 'Capital', it would make no reference to Marx except for a few brief side-examples of the tragic flaws in his thinking). People call Marx's work Das Kapital because then everyone, and not just serious leftists, knows exactly which work is being mentioned. It's not an insult, it's simply a more effective reference.
Your comment is like saying that people who know you call you Will (or Bill, or whatever) whereas strangers call you Mr. Stoddard, and that therefore those strangers must be plotting together and trying to imply something specific about you, personally, by not using the term used by your close acquaintances.
One true anecdote about Capital is that the Czarist censors let it pass, because it was considered too arcane to be subversive.
Following on from Ann's 9:05 comment, how many people do you know who have read "My Struggle"?
/godwin
I actually wondered which term to use, but decided, as Ann notes, that if I did, no one would understand what the hell I was talking about except people who've read a fair amount of Marx. Don't ask me why Manifest der Kommunistischen Partei gets translated, and Das Kapital doesn't, but the common parlance is the most useful shorthand.
Normal people in the US don't refer to the work as Capital. It may an "in" thing for scholars to refer to it that way, but it seems odd to assign an ulterior motive to people for discussing a book by the title they learned in high school.
Megan:
I really don't think that reasoning is plausible. Your first mention of the work was the attribution of a quotation to "Karl Marx, Das Kapital, 1867." Since that was presumably quoted from some other source elsewhere on the Internet, it was of course appropriate to keep "Das Kapital" as the title, following your source word for word. But if, after that, you said "It's been fifteen years since I read Capital," only a thoroughgoing dolt would fail to get that you were referring to Marx's book. So I think it was an unnecessary concern.
"It's been fifteen years since I read Capital," only a thoroughgoing dolt would fail to get that you were referring to Marx's book.
I have friends who graduated from the USMA, but they don't call people "dolts" if they are more accustomed to the geographical appellation for that particular school.
Sometimes, it is unnecessary to demonstrate that you are an insider with superior knowledge to everyone else. Certainly it is always unnecessary to criticize others when then fail to flaunt their insiderness.
Megan writes: "Don't ask me why Manifest der Kommunistischen Partei gets translated, and Das Kapital doesn't...."
The title "Manifesto of the Communist Party", or "The Communist Manifesto", is easy to understand. It's about communism, and once we know it's about communism, we know it's evil. (Right message.) "Capital" means it's about capitalism, and capitalism is good, so even if the book is a difficult read, it's not necessarily evil. (Wrong message!)
Writers like Megan, who are worried that readers may not pick up right away on what the title "Capital" refers to, can solve that problem by referring to it the first time around as "Marx's Capital". (Italics also help, and I'd use them here if I knew how to.)
*** I've just previewed my comment and discovered that while I was writing it, William H. Stoddard has read my mind again. Weird.
"It's about communism, and once we know it's about communism, we know it's evil. (Right message.)"
Communism isn't evil. It's just such a bad system that its implementation leads to evil and to suffering, whereas capitalism, if it's well regulated, leads to wealth creation and choices.
Given all that we've learned about communism in practice, one could certainly argue that anyone that tries to implement it is evil, although again they may simply be stupid.
Perhaps Marx had some great insights on politics and history, but he was pretty pathetic in his understanding of economics, having entirely failed to comprehend the importance of both incentives and markets.
Just out of curiosity, William H Stoddard and mijnheer, if you hear somebody refer to "gypsy cabs" in NYC, do you interrupt them to ask if they mean "Romany cabs"?
Marx recognized that capitalism was the greatest system ever for promoting technological development and creating wealth ("what earlier century had even a presentiment that such productive forces slumbered in the lap of social labour?"). Not only that, he and Engels said, but capitalism had united and civilized the world. The system, unlike earlier modes of production (and unlike state socialism, its rival form of industrialism) is intrinsically self-expanding, driven by competition and the search for profit, which makes a hothouse for technological innovation.
By the 1870s Marx and Engels had abandoned the idea that violent revolution was necessary. The U.S. was among the countries named by Marx as having political institutions that would permit the working class to come to power peacefully.
Marx's downfall was that he didn't understand the lure of the Internet, which deprives potential revolutionaries of any time to organize the proletarians, who are in any case more interested in shopping at the mall and watching American Idol.
This "Capital" vs. "Das Kapital" bit boggles my mind. Why should a writer take special effort to avoid using the most common way of referring to something?
I've never claimed to be a "serious leftist", but this is perhaps the first time in almost 50 years of life I have heard the book called "Capital". "Das Kapital" is completely unambiguous.
I don't think the fact that the first 10 years of my life were spent as a German speaker would cause me to miss the "foreign and unassimilable" quality of the title we, too, learned in high school, by a teacher who also made us read Fidel Castro, Kafka, and Ursula Leguin.
Jens:
"Why should a writer take special effort to avoid using the most common way of referring to something?"
To condescend, rather than communicate.
I've been told for decades that it is the duty of a speaker to speak to the specific audience at all times. I'm not sure if this doesn't apply outside the sciences, or if there is something else in play.
I heard that fake Marx quote on Mad Money while at the gym last night and laughed.
I'm trying to avoid making the joke "'serious leftist' is an oxymoron" but apparently I just failed.
"Writers like Megan, who are worried that readers may not pick up right away on what the title "Capital" refers to..."
I didn't detect any anxiety in Megan's message. All the pedantry and paranoia is ccoming from those who object to the use of the term Das Kapital.
Why am I getting involved in this debate? Somebody shoot me.
That anyone in 2009 wasting their time on Marx -who died in 1870 - is absurd.
Other than starting a political philosophy that's brought death and and misery to hundreds of millions of people - his books are out-of-date and of little value. His books should be relegated to the dustbin or used for obscure academic study.
Marx however serves one useful purpose. Whenever anyone starts quoting him approvingly or spouts Marxist jargon I know I can tune them out immediately. He can be quite a time saver.
Actually it was written by Karl's stoopid son, George W. Marx
Apocryphal quotes are some of the most underappreciated, and most numerous, inaccuracies that get disseminated on the Internet.
The last time I had a good round of apocryphal quote-checking was while watching "Zeitgeist". It is really incredible the number of fake quotes that are passed around on Paulbot, conservative, and anti-Bush blogs and fora.
Sounds like him to me! (Groucho)
"The last time I had a good round of apocryphal quote-checking was while watching "Zeitgeist"."
wait you should say Time Spirit...so you wont be branded a right-winger that is out to defile the original work.
i have never read any of his works but am familiar with who he is and... Karl Marx, Capital, 1867 vs Karl Marx, Das Kapital, 1867 is no different to me. any preconceived notions were firmly established upon reading the authors name. whether the book is referenced in german or english would be an after thought. so i dont think the right wing propagandist are at work here.
incidentally i just received the quote via a "street" source and Das Kapital (or Capital) was not referenced.....i should note that at least 1 idiot near me immediately assumed the quote was real.
any way, Marx was wrong , and even he could not complete his book
I read the whole discussion thus far, and I resolve the controversy about the respective titles of Marx's works as follows:
In our U.S. English speaking culture, "The Communist Manifesto" is a unique phrase. "Das Kapital" is unique. "Capital" is not unique. Therefore we speak of "The Communist Manifesto" but "Das Kapital." No disrespect intended.
Heh, the whole point of Das Kapital is to claim that there is a monopoly on capital because the capitalistic class conspires to keep it that way, thus "forcing" the proletariat into wage-slavery.
Easy credit is a total contradiction of that thesis.
It was worth while to read you just for the intelligence that immiserate is an English word! As a professor of Latin, I know there is no "immisero, -are," "put into misery," and that immiserabilis means "unpitiable," so I googled, but you are right. Neat word. Neat article.
The bankers 'quote' is probably a garbled recollection of the following from Capital, Volume 1, though as you will see, it only comes close to supporting the meaning of the first sentence, their is nothing like the second about banks and bankruptcy in Volume 1.
"A larger part of their own surplus product, always increasing and continually transformed into additional capital, comes back to them in the shape of means of payment, so that they can extend the circle of their enjoyments; can make some additions to their consumption funds of clothes, furniture, &c., and can lay by a small reserve-funds of money. But just as little as better clothing, food, and treatment, and a larger peculium, do away with the exploitation of the slave, so little do they set aside that of the worker. A rise in the price of labour, as a consequence of accumulation of capital, only means in fact, that the length and weight of the golden chain the wage-worker has already forged for himself, allow of a relaxation of the tension of it." Chapter 25, p 579-580, Lawrence and Wishart edition.
Marx does write about the role of credit in driving speculation and fictitious capital leading to bankruptcies in Volume III, and he writes about all kinds of credit notes (including in one throwaway comment, personal credit, but from the context it seems clear that it is personal credit extended to capitalists, p 403). But his main example of credit's role in the business crisis of 1845-47 is dealing with credit notes given on cargos of cotton goods exported to the Far East, which turned out to be unsupported. (Interestingly the crisis was avoided by the suspension of the Banking Act limiting the amount of fiat money the Bank of England could print, Marx says, p 408)
The bogus Marx quote:
"Owners of capital will stimulate the working class to buy more and more of expensive goods, houses and technology, pushing them to take more and more expensive credits, until their debt becomes unbearable. The unpaid debt will lead to bankruptcy of banks, which will have to be nationalised, and the State will have to take the road which will eventually lead to communism. "
What? Karl Marx was a revolutionary? From what my Econ 101 professor said, I thought he was one of the apostles of Jesus Christ. You sure you got that right? :)
Google tells me this is the first reference to the invalid line, and the author cites /his/ source, Whitney Tilson:
http://www.bloggingstocks.com/2009/01/24/did-karl-marx-predict-the-bailout/print/
Ha ha, yes, the language is much too modern too. What kind of PSYOPS venture was that?!
To those that dismiss Marx here, first have you actually read him? As some commenters mention, the popular ideas about his thoughts can be far from reality. Second, while I agree with many criticisms above of Marx, even the important fact that he is dead and un-able to evolve his thinking to new experiences, I find Marx no more wrong or worthy of criticism than practically any other historic, political, or economic thinker since him.
Yeah, we can see Marx had his flaws from our last 150 years of experience with our modern versions of capitalism, communism, facism, socialism, colonialism, imperialism, wars and genocide and with the 21st century economic cycles and various monetary poliices. I find some of Marx insights still apply and good chanllenges to current otrthodoxy and some of his insights to not pull forward, and some were wrong conclusions, even then.
But I am really missing who has come along and incorporated all that we know now and analyzed it thoroughly and formed a really good proposed solution of what is the best way to organize a city, a state, or the world to the sustainable benefit of all, including balancing all the contending desires of providing basic necessities, protecting environment, ensuring training/educations/opportunity for all, innovating, increasing productivity of farms, factories, markets, technology, avoiding the unproductive over-concentration of market power (monopolies/trusts), political power (non-responsive states) or wealth, providing political space and time for peope to freely associate and express themselves.... (I could go on).
I find "free" markets are idealized for the efficienices they produce for some producers and consumers (certainly a huge benefit) but not considered for the misery and asymmetries they create. I find capitalism of US, Europe, Japan, lauded for the wealth it creates for those countries compared to say the the countries of the era of Soviet Union and its sphere of influence, while ignoring the requisite mysery of the capitist colonies such as capitalist Haiti,almost all of Africa, souteast Asia. Modern academia on monetary policy seems just as limited.
I am new to studying economics, but I find in my current read of Western economic academia that they are really bad, bad, bad in their limited analysis and their predictions. They don't seem scientific or insightful. Current economic thought seems very corrupt or ignorant or both. I can get more understanding from a serious discussion with a smart friend or on the internet by people that are not constrained by economic orthodoxy than I can find by almost any current economist I read. For those that think Marx is so off base (not that I disagree with you), who is the right one? who is the one best summing up what is happening now and what should have been, what should be different.
OK, admittedly, this particular quote is not what Marx said in his own words. However, it does fit rather neatly into standard Marxist theories of crisis, due to the declining rate of profit of capital. Consider the following quote from Marx:
'Under all circumstances, a portion of the old capital would be compelled to lie fallow, to give up its capacity of capital and stop acting and producing value as such. The competitive struggle would decide what part would have to go into this fallow state. So long as everything goes well, competition effects a practical brotherhood of the capitalist class as we have seen in the case of the average rate of profit, so that each shares in the common loot in proportion to the magnitude of his share of investment. But as soon as it is no longer a question of sharing profits, but of sharing losses, everyone tries to reduce his own share to a minimum and load as much as possible upon the shoulders of some other competitor ... competition then transforms itself into a fight of hostile brothers. The antagonism of the interests of the individual capitalists and those of the capitalist class as a whole then makes itself felt as previously the identity of these interests impressed itself practically as competition' (Marx, Capital Volume III p248 (Translation Kerr ed. Volume III p.297)).
The quote, and a nice explanation of Marxist crisis theory, can be found here: http://www.marxists.org/subject/economy/authors/yaffed/1972/mtccs/mtccs3.htm#ref3b
The falling rate of profit from non-performing loans, in this case, leads to a seizure in the credit market between banks, which leads to companies no longer financing their operations, which leads to layoffs - in turn generating the social tension that leads to some form of crisis conflict and alters the mode of production. It may not alter it into communism, but it does need to reduce the concentration of capital, to re-inflate the rate of profit.
The point is that Marx did predict the general logic behind crises of this sort, and has been proved right again and again. Keynesian economics and counter-cyclical economic policies are really just a prescription for auto-adjusting the rate of profit by changing the concentration of capital via public works programs and tax cuts which progressively shift the concentration of capital downward.
you are all nerds…
Check Wiki Quotes. Marx DID use the word "technologie". Seems he didn't like it very much. But the disputed Marx quote is, frankly not "dense" enough for Marx. It's much too simple. Hoax, IMHO.