Marx'sAndWeber's Views on Capitalism
Name: Gil Petersil
Teacher: George Turski
Course #: "Wealth and Power Realities"
Date: Monday, May 12, 1998
Marx's and Weber's
Views on Capitalism
During the nineteenth century, Karl Marx and Max Weber were two of the most influential sociologist. Both their views on the rise of capitalism have many similarities and differences. They believe that capitalism is relatively new to the modern world. Their views differ on the rise of capitalism. Regardless of Marx and Weber's differences, both theorists agree that capitalism is a system of highly impersonal relations.
Karl Marx was born on May 5, 1818 to the father of a Jewish lawyer. Marx had seen history as consisting of both the dialectic and materialism. He called this "Dialectic Materialism." History, in the view of Marx, was a dialectic materialism that evolved through time.
Marx's dialectic was not based on the conflict of ideas, but rather on the dialectic of classes. This conflict results in a society's new mode of production. Each period of history consists of a mode of production. Throughout history, these modes changed through the dialectic. The dialectic would lead to a new mode of production, and a new era in history. Marx states that these modes of production are primitive communism, slave society, feudalism, mercantilism, capitalism, and then socialism and communism.
In studying the rise of capitalism one is concerned with the periods of primitive communism, slave society, feudalism and mercantilism, and how they led to the rise of capitalism in western society. "In society, the mode is production is dichotomous to the means of production". (Rosdolsky, 1977). If there is a slave society there must be slave owners as well as slaves. Capitalism consists of those who own the means of production and those who are the means of production, but to understand how society reached this level one must look at the progression of society starting from primitive communism.
In primitive society, the mode of production is communal. This is because in primitive society there is no privately owned property. This is a society whose means of production is based on hunting and gathering. What is not consumed in the hunting becomes surplus and must be stored. This is where Marx found instability in this society. Those who have control over the surplus have the power. Herein lays the concept of the chief. The chief or leader is the one who has the power over the surplus. There are different chiefs for each of the communes. These communes are then in competition for who will gain the greatest surplus.
The different communes are in competition with each other. The communes come to the realization that it would pay off to conquer the competing communes to gain their surplus. By conquering the opposing communes, they would take over the people of the communes as well. It would be much easier for the victors to have the conquered do the hunting and gathering.
In a sense, they would be using these people as slaves. This is where one sees the first distinction between classes. The society has moved from a primitive communist society to the first slave society.
Slaves have now become the means of production in this society. By creating a slave society, we have created classes. It is in the classes that Marx talks about the dialectic. The arguments between the classes will eventually lead to a new mode of production and therefore a new society. Many of the slaves were not only used as a means of production, but also in defense of the surplus.
The slaves also become used as a military power. Slave society had internal instability. This is evident in the case of Rome. Rome was a slave society whose downfall was due to the class dialectic between the slaves and the slave owners. Slaves would eventually revolt against their slave owners. This would lead to the end of slave labor as a means of production.
The end of slave society would lead to either an Asiatic or a feudal mode of production. In the Asiatic mode of production the slaves were given some rights and used as military power. The distinct difference was that slaves of the Asiatic mode were not to be bought or sold. The other mode of production was feudal. Feudal society is the most important since, it will directly lead to the rise of capitalism. We see in the feudal society the rise of a stratified class system. The king was the ruler of the land and the ranks of those below him depended upon the military titles given by the king.
The lords owned the masses of land. The serfs on the land did Work in order to survive. Any surplus was given to the lord. This was the payment to the lords for using their land. The difference between the serfs and slaves was that serfs were not owned by the landlord. The one aspect of serfdom that remained different from slavery, was that the serfs children were required to work the same land their parents did. Serfs were a valuable asset to the land because they produced necessary goods as well as the surplus needed to pay the landlords. Serfs were also valuable in the sense that they could be used in military battle. Many times serfs were promised something in return for taking part in the battle.
Between feudalism and capitalism came the rise of mercantilism. This from of society was not based on the means of production. Rather, it was dependent on merchant trade as a means of acquiring goods. This society was a small step in the rise of capitalism.
In the era of mercantilism, people began to make a living by trade of goods. Those who made their living by trade were the merchants. Some merchants would invoke a promissory notice if they did not have the product they wanted to trade. This notice was a piece of paper that later promised a product to the customer. In Switzerland the people began to print a general promissory notice called "thalers." This gave rise to the notion of the dollar and hence the rise of the cash nexus. (Marx, Engles, 1978).
Merchants began to exchange cash without the lords knowing. In the meantime, feudal wars broke out between the landowners in Europe. Landowners were taking over other landowners and acquiring more serfs. This would eventually threaten the power of the king. In order to suppress the threat of the landowners, the king would unify the serfs as an army of his own.
Concurrently, the cash nexus worked its way into the rest of society. The king wanted a part of this cash. As a means to acquire the cash, the king would impose taxes on the people. With this cash nexus, many peasants were able to own land by purchasing it. The landowners were beginning to be a threat to the king. To help stop the power of the landowners the king allied with the merchants to suppress the landowners. Landowners would then charge tolls for the merchants to cross their land. This is an example of another class conflict that is between the aristocrats and the merchants.
In the late nineteenth century, wool trade had become a big money maker. Yeomen were experienced sheepherders who benefited from the wool trade. The English merchants, who had allied themselves with the king, wanted to profit from the wool trade. In order to do this, the merchants had the landowners removed from the land and replaced with the yeomen. The merchants could then use the wool in their trades. This would then lead to the beginning of the enclosure movement.
The king, with the use of his army, would force the landowners off the land. He would then hand the land over to the yeomen to herd sheep. Since this enclosure movement was forcing people off the land, there was a rise in the number of vagabonds. (Marx & Engles, 1978). These vagabonds constituted a source of human labor, which the merchants could use in wool production. The merchants would then bring in the vagabonds to work the weaving machine for a wage. Labor has now become a commodity to the merchants, and the formation of a new mode of production has risen. This new mode of production gave rise to the capitalist society. There is a new class distinction between the laborer or lower class, and those who owned the means of production or the capitalist. (Marx & Engles, 1978).
In the formation of the capitalist society, there are two prerequisites for the rise of capitalism. First, a certain individuals have enough money in his possession. In the feudal society, the accumulation of funds was in the hands of the merchant traders as they took over the land. The second prerequisite is that there has to be a large amount of free labor. Feudal society also met this requirement in the large amount of vagabonds. These people were thrown off their land and had no work.
Skilled labor was broken down into simpler tasks such that any individual could accomplish the tasks. Thus, skilled labor was devalued and unskilled labor came to the fore. The workers workday consisted of twelve hours during which they received an hourly wage.
A six-hour workday may be enough to cover the cost of the labor but no surplus money is made. The next six hours of labor is surplus money. In Marx's view, the capitalist makes his money by the surplus of workers. Therefore, from the standpoint of the capitalist, there are two types of capital. Constant capital, which is the necessary capital made to cover the costs of machinery, tools, labor and raw materials. The second is variable capital, which is dependent on the production of the labors.
By expanding the variable capital, the capitalist can gain more surplus value. One of these ways is by expanding the workday. According to Marx, any labor time over what is needed for constant capital is considered surplus. If it takes only six hours a day for constant capital, then all hours after that would be capital that the capitalist makes for free. This surplus capital may be free for the capitalist, but it causes a contradiction.
For the capitalist the best way to sell a commodity is by having the lowest prices. The only way to have the lowest prices is by keeping the cost of production down. The only cost of production that the capitalist has control over is the cost of labor. Therefore, in order to lower prices the capitalist must lower the wages of the workers. This causes a contradiction because the laborers are also the consumers. If the laborers do not have the wages to buy a product then the company can not sell a product. This means that there is an overproduction and an under consumption of goods. When this occurs, the capitalist must lay off the laborer because he is not making the necessary constant capital.
The other problem Marx saw with capitalism is that it "alienates" the workers from their jobs. The work becomes highly impersonal. In feudal times, the laborer was able to see what the final product looked like, and was able to sell it for themselves. Under capitalism, the laborer is not able to do this. They are forced to produce product for someone else. The laborers feel alienated from their jobs, and do not take pride in the work they have done. This will then lead to the laborer not producing quality products. The laborer is not dependent on the quality of the goods to sell the product because they are paid an hourly wage. This will lead to an unmotivated worker and low quality products.
The dialectic between the laboring class and the capitalist will then lead to a new creation. According to Marx, this new creation will be Socialism. In socialism, there is no private property and the government owns the means of production. Marx hypothesized that socialism would lead communism, which would be a classless society.
Max Weber was a German anti-socialist born in 1864. Weber was opposed to Marx and believed that his theory was an oversimplification of history. Weber thought Marx's view of history was too focused on economics. Weber felt that scientific, historical, and philosophical analysis of a period could never provide by itself the proof necessary for final answers to questions, including those of politics.
Weber had thought that researchers must distinguish the difference between what exists and what ought to be. (Kileullen, "Max Weber: On Capitalism")
Weber thought there was a link between capitalism and the Protestant work ethic. Specifically Weber looked at Calvinism. Calvinism was a simple way of life in which you were to do good for others. The way into heaven was to do the greatest good for the greatest number of people. Weber feels that this belief is eventually implemented into society. Work was done not for one's own personal gain, but for the sake of god.
Weber had found that in areas where Calvinism was the highest is where capitalism rose first. Weber had based this theory on research that he had done. The rise in capitalism was where the Protestant ethic was the highest, and no other religion resulted in the rise of capitalism. All other religions do not stress work as a means to get into heaven. If we take the Muslim faith, we see that dying for ones religion is considered as a means to get into heaven. The Protestant ethic is the only faith where wealth reinvested is a means to get into heaven.
In comparison to Marx, there are some similarities in this theory. Marx had believed that a certain portion of the wealth will be needed to reinvest, but it was reinvested into more capital. For example, a portion of money made selling hardware would be reinvested in more hardware. The difference between the two is that Weber feels that capital is reinvested for the good of others, and Marx feels that it is reinvested so one may acquire more surpluses.
Weber not only saw capitalism as a system of reinvestment, but as a highly effective yet remote system. With the rise of capitalism, Weber was concerned about how highly impersonal the system had become. Weber called this system bureaucracy. This system depended on people who were appointed to a position. Weber saw that this system even existed in a democratic society. This system was impersonal but it was efficient. It was a highly organized way of doing work. Marx had also agreed that bureaucracy was a part of capitalism, but he had seen it as an inefficient circle.
Where Weber saw bureaucracy as a necessary evil, Marx saw it as an endless circle. In the words of Marx, bureaucracy took state objectives and transformed them into the objectives of the department. The department would then transform those objectives back to the state. According to Marx, this form of shifting the responsibility is an endless circle that can not be escaped. (Rosdolsky, 1977)
For Weber the power of a capitalistic society comes from the bureaucracy. This bureaucratic power is legitimized by the use of rational-legal authority. This authority is a set of impersonal rules that regulates an anonymous individual. In the feudal society, it was not the group who had power, but the person who had economic wealth. It is traditional authority, which legitimizes this power. This authority is based on tradition and trust. In feudal society, it was the tradition to listen to the power of the king and his subjects put all their trust into the king.
This type of authority, that of the king, was not as impersonal as the rational-legal authority. If a king needs to borrow something from his subjects, the king is able to get it. If the United States government asked to borrow one's car, one would not give it to them, because one does not personally know and trust the United States government.
The bureaucracy may exist because of its rational-legal authority, but for Marx it only exists as far as its relations to the state do. This is very similar to Weber's theory of patent action orientations. One of the aspects of Marx's theory that Weber criticized was that of the lack of patent action orientations in his theory. Marx based his theory on the dialectic of the proletariat. What Weber criticized was that Marx did not define the proletariat in respect to their relations to the rest of society. In essence, what Weber is saying is that one's actions with respect to others define who one is in society. For further explanation of this theory, let us take the example of the professor and the student. (Kileullen, "Max Weber: On Capitalism")
One is a student only as far as one's actions in relation with the professor, and the professor as far as the student is. These actions would include one going to class, taking notes, listening to the professor, writing papers and taking exams. These actions define one as a student and define Mr. X as a professor. Actions define who one is in society. For Weber this is where Marx failed to define who the proletariats are in relation to the others in society. Marx defines the proletariats in terms of their relation to the means of production, but not in their actions.
Marx was more concerned with the structure of society rather than the meaning. Marx had felt that this class structure is the one that gave power to the classes. This term of class is used differently between Marx and Weber. For Marx the rise of capitalism was the result of the dialectic between the two classes. Weber, on the other hand, felt that once feudalism had been abolished so was the class system. Class in the feudal era was determined by one's bloodline. If one were a serf then one's son or daughter would be born into the same class status. The same would hold true for any other social status. The next in line for the throne of the king is his first born son. With the rise of capitalism, this distinct line between classes vanished. Weber, rather, saw class in capitalist society mainly in terms of a monopoly.
Weber viewed a monopoly as those who had the power to bargain. Those who have a monopoly are less eager to exchange goods. One's class situation is defined by their situation in the exchange market. Class is therefore determined by ones ability to exchange on the market. The possibilities of classes consist of ability to exchange and the kind of capital to be exchanged. This leaves the possibility for more than one class rather than two.
Marx and Weber may disagree about the rise of classes in a capitalist society, but they do have their similarities. Marx felt that history was based on the conflict between classes and this conflict would cause the downfall of capitalism.
Weber does not agree that class conflict is what defines history, but he does state that "a class is not a community but a possible basis for societal or even communal action" (Rosdolsky, 1977).
People of a community or group may have individual interests, but they put those aside to work as a whole. When individuals act in a societal movement they may do different things, but they are acting in cooperation because in the end it will serve in their individual interests. Individuals act in cooperation with the group because it is the most rational way to serve their individual interests. This is very similar to Marx's view on a proletariat revolution in capitalist society.
Marx felt that the individuals in the lower class would come together and revolt against the capitalist. Marx, however, did not feel that the lower class would automatically come together because of their similar class. Rather, the people of the lower class will come together in a common interest. They all realize that in the capitalist society they will always be exploited by the capitalists. Therefore, the lower class comes together in a communal action for their individual interests. People take part in the revolution in an attempt to better their individual lives.
Marx and Weber are two sociologists who both wanted to explain the rise of capitalism in western society. Weber had argued that Marx was too narrow in his views. He felt that Marx was only concerned with the economics in the rise of capitalism. Weber, on the other hand, tried to look at the macro-sociological phenomenon in his explanation of capitalism. Weber had felt that there is just more than one explanation to the rise of capitalism.
Regardless of their differences, there are many similarities in their theories. The basic theme in both their theories is that capitalism rose from a personal society to a highly impersonal society. They both may have different reasons as to why capitalism rose, but they both agree as to what it became. Weber had felt that the impersonal system of capitalism was exemplified in the bureaucratic power. Marx saw the impersonal system in the alienation of the lower class workers.
The writings of Weber leave the door open for the possibility for revolution in a capitalist society, but he does not directly speak of a revolution. Marx, although, speaks directly of a revolution and the self-destruction of the capitalistic society. One of the factors in this revolution is the impersonal relation between the lower class and the capitalist. The impersonality of capitalism, exemplified in the failure of the lower class to feel meaningful in their work, fuels the movement for a revolution.
Weber was very concerned with this impersonal bureaucratic system and this was one of the reasons that he was compelled to study the rise of capitalism. He had seen the rise of the bureaucratic powers in western society, and Weber saw how society was becoming less and less personal. This is a problem in the capitalist society that both men had seen in the nineteenth century, and this problem still exists today. People have lost a sense of community and gained the sense of individuality. The loss of personal relationships can lead to many internal problems in a society and possibly a downfall.
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