The Origins of Capitalism: A Longer View - Report Example

18th September The development of modern economics, sociology and journalism, have been instigated by various philosophers from the developed and developing countries. One of the notable philosophers who have significantly contributed in the three fields is Karl Marx. Being a German philosopher, Karl Marx established Marxism theory which argues that societies develop through the interaction of classes. Contrary to the utopian sociologists who supported small scale socialistic communities, Marx advocated for large scale change in the in the economy in order to experience real change. This paper seeks to analyze Karl Marx view of capitalism and the major criticism of the system by Karl Marx and other individuals. Capitalism refers to the economic system that is open to new firms and ideas thus resulting to more innovation. One of the major aspects that led to the support of the capitalism by Marx is that it leads to economic efficiency due to the fact that the principles of capitalists are widely adopted at the international and national levels. As a result of free entry of new firms in the capitalism system, the level of investment rises leading to more job opportunities and improved economic position of households. In this regard, Marx just like Engels, his fellow philosopher was on the opinion that capitalism should be emulated by government and business communities since it improved the living standards of individuals by initiating technological, scientific and economic developments. In his analyzes of capitalism, Karl Marx covered two main elements that include Proletariat and Bourgeoisie. The section below candidly indicates the relationship between the two elements according to Karl Marx. Capitalist class structures Proletariat and Bourgeoisie are the two primary social classes that make up capitalists society. According to Karl Marx, Bourgeoisie are the owners of the factors of production that includes land, machinery, raw materials, factories as well as business organisations that are used to produces commodities demanded by members of the society. On the other hand, Proletariat works to earn wages and they own little or no property. Similarly, Marx depicts that due to the polarisations of the classes within a society, members of the intermediate classes would be converted into either Proletariat or the Bourgeoisie. Nevertheless, Marx argued that as a result of economic growth and the establishment of stock companies, the level of employment would improve leading to more jobs thus resulting to emergence of middle class. The major area that Marx covered in his theory of capitalism is the relationship that exists between Proletariat and Bourgeoisie. He indicated that the two classes are dependent on each other. For example, Bourgeoisie depends on Proletariat during the production of goods and services since the latter do not own property and they have to work to earn wages. In this way, Bourgeoisie derives profits from their firms. On the other hand, Proletariat relies on Bourgeoisie who provides them with employment opportunities from where they generate their income. Even though the two classes have strong positive relationship, the aspects of conflict and exploitation are evident. For instance, the Proletariat who are the providers of labor in the firms owned by Bourgeoisie, are exposed to poor working conditions that includes low salaries, working for long hours that exposes them to poor health as well as poor housing. In their efforts to increase profits, property owners exploit the workers by paying them low salaries that is not equivalent to the value of the goods and services produced in the factories. The theory of capitalism as depicted by Karl Marx, stipulates that the decision of which goods and services to produce largely depends on the desire to maximize profits rather than the need to meet human wants. In the same way, it is the capitalists who set the prices of their goods meaning that the workers have no other alternatives but to accept the prices charged on the goods and services provided by the capitalists. Another imperative aspect of capitalism is that workers have no significant control during the production process. The production process that is under close scrutiny of the factory owner’s, entails series of tasks that are viewed by the workers as boring thus limiting their opportunity to be creative. Criticism of capitalism system Despite the view by Karl Marx that capitalists principles leads to economic efficiency, innovation and elimination of traditions that are conservative, his criticism of the theory cannot be overlooked. Marx argues that capitalism lead to injustice and exploitation. Based on the fact that the aim of the property owners is to maximize profits and reduce the cost of production, workers experience unpaid surplus labor. Furthermore, the system exposes children to labor, long working hours as depicted earlier and basically poor health and working conditions for the proletarians. In the same way, Weber depicts capitalism as a system that instigates injustice in the capitalist society based on its failure to offer development opportunities to the poor and ineffective use of economic resources. It is worth to note that it is due to these injustices that revolutionary movement were experiences in countries such as Cuba, Russia and China among other nations. Karl Marx also argues that capitalism system is irrational. This implies that as the firm owners compete with each other with the aim of increasing profits and putting at bay their rivals in the industry, the crises of overproduction emerges. Despite the increased production, the poor members of the society are not able to acquire basic needs since the capitalists are not willing to reduce their prices. Another vital criticism of the capitalism as depicted by Marx and Engels is that its social and economic problems are caused by private ownership. Additionally, the two philosophers believed that all the earnings generated by firms should benefits both the owners and the workers since all of them works on their own ability implying that they are equal. In this regard, the development of classes leads to jealousy and social tensions that generates more social problems. In this regard, Marx advocated for rebellion and uprising by the Proletariats in order to save themselves from the exploitation by the Bourgeoisie. On his part, Immanuel Wallerstein renowned world-systems analyst argues that capitalism has led to increased real wages and taxes as well as high costs of raw material thus increasing the prices of goods and services. He argues that capitalist world economy is currently at its final crisis that may lead to more economic inequalities in the next fifty years. As mentioned earlier, Marx and Engels were on the opinion that capitalism should be allowed to develop. However, Marx views capitalism as the major cause of alienation within a society. For example, capitalists consider their workers as sources of labor rather than individuals with human characteristics. He also argues that workers view their colleagues as competitors for the few employment opportunities available instead of seeing them as corroborators. As a result, this system leads to vices of hatred and jealousy among members of the society. Conclusion Based on the above discussion, the system of capitalism as depicted by Karl Marx, leads to emergence of new firms and innovation due to its nature to allow new ideas despite the fact that it advocates for private ownership of property. However, as capitalists aim at maximizing their profits and offset their competitors in the industry, there is emergence of social classes namely the Proletariat and Bourgeoisie. Bourgeoisie are the property owners who controls all the production processes while the Proletariat are the source of labor. It is on the basis of poor working condition, job insecurity, low salaries, alienation and injustice of capitalism system that Karl Marx and Engels among other philosophers are opposed to this system despite their earlier support. Works Cited Bacher, Christian. Capitalism, Ethics and the Paradoxon of Self-exploitation. London: Sage, 2007.Print. Obrinsky, Mark. Profit Theory and Capitalism. New York: University of Pennsylvania Press, 1983. Print. Robbins, Richard. Global problems and the culture of capitalism. Boston: Allyn & Bacon, 2007. Print. Wood, Ellen. The Origins of Capitalism: A Longer View London: Verso, 2002.Print. Read More