Views on Capitalism

Karl Marx’s Perspective on Capitalism

Marx’s critique examines capitalism’s alienation and exploitation. He says the constant pursuit of surplus value and capital accumulation separates workers from their products and labour. Marx said, “An accumulation is not the result of the capitalist mode of production, but its starting point.” This reinforces the idea of capitalistic production, which relies on surplus value to accumulate capital and exploit workers.

Marx’s argument forecasts capitalism’s doom due to its contradictions and inherent constraints. Marx claims that unequal productivity and natural conditions lower profit rates, making capitalist accumulation difficult (Marco, 2023). He also shows how competition requires higher capital investments, restricting smaller capitals from specific industries and revealing the weaknesses in the capitalist structure. He advocates a society with socialized production and communal ownership. Marx proposed a society where the means of production are mostly owned, increasing collaboration and eliminating capitalist exploitation.

John Maynard Keynes’ Views on Capitalism

John Maynard Keynes, an influential economist, advocated for government intervention in managing economic fluctuations inside capitalism. He accepted that during times of economic distress, government intervention was imperative. Keynes emphasized this by stating, “It is not the ownership of the instruments of production which the state needs to assume.” This mirrored his stance on the importance of the state’s role in regulating the general economic output and remunerating those associated with production. He contended that stimulating demand during periods of economic downturn was essential, as evidenced by his assertion that “government policies — spending, distribution of income, reduction of taxation — will continue to be effective.”

Keynes proposed that the government should focus on regulating employment through demand management policies, especially government spending, to ensure full employment. His emphasis on demand stimulation as a catalyst for increased production was evident in his thought that “any redistribution of income downwards to people who consume most of it and any expansion of government spending will stimulate production and reduce unemployment.” Keynes advocated for an active role for the government in macroeconomic management, emphasizing the provision of social services, regulation of markets, and manipulation of government spending, taxation, and money supply to achieve economic stability (Muthusamy, 2023). He believed in the dual program of “full employment and equality,” where government policies directed toward managing demand and providing social services constituted the foundation for a stable capitalist system.

Comparative Analysis of the Three Thinkers’ Views on Capitalism

Karl Marx, and John Maynard Keynes had contrasting but comparable views on capitalism. Marx highlighted capitalism’s problems that led to its downfall. Marx recognized capitalism’s dynamic essence but with different interpretations. Keynes advised, “It is not the ownership of the instruments of production which the state needs to assume.” Schumpeter’s emphasis on innovation as the source of economic development contrasted with Keynes’ focus on government intervention and control of economic volatility.

Marx believed that capitalism’s underlying contradictions made it unsustainable and unadaptable, “Hence, Marx held, capitalist democracy is ‘only the political form of revolution of bourgeois society and not its conservative form of life.'” They argued that capitalism’s intrinsic dynamism and invention may explain its longevity, saying, “it must be advancing, and if advancing, it is doing so because its resistance to change is progressively diminishing.” Keynes again suggested government action to stabilize capitalism’s economic oscillations, “by stimulating demand past the level of potential output, the government will stimulate investment and economic growth.” Marx focuses on internal contradictions, and Keynes on government intervention to support capitalism. Keynes’s focus on government involvement stabilized capitalism but may have limited structural change (Herr, 2022). Each approach sheds light on capitalism’s dynamics, but it may need help to address its intricacies and long-term sustainability fully.

Argument

Based on the thinkers’ comprehensive evaluations, I agree that capitalism is dynamic and innovative. Marx and Keynes were accurate about capitalism’s difficulties and government meddling, but Schumpeter’s approach fits modern economies’ evolving nature. Schumpeter’s ‘creative destruction’ characterizes capitalism as innovation and entrepreneurship-driven. He said, “The opening up of new markets and the organizational development… incessantly revolutionize the economic structure from within.” Capitalism’s continual innovation matches my conviction in its flexibility (Clift & McDaniel, 2021).

Capitalism’s intrinsic inventiveness and adaptability may help it overcome internal contradictions, contrary to Marx’s prediction. Marx criticized capitalism for its exploitation and inconsistencies, which led to its demise. I disagree with Marx by highlighting capitalism’s ability to adapt and overcome obstacles through technology and entrepreneurship. The rise of new markets, technical advances, and entrepreneurial spirit demonstrate capitalism’s ability to adapt and survive. Statistics on economic growth and technological advancements in capitalist societies support the system’s dynamic nature. I agree with Schumpeter’s thoughts on innovation and dynamism and support capitalism’s adaptability.

Conclusion

Karl Marx, and John Maynard Keynes had diverse views on capitalism. Marx’s flaws and potential demise, and Keynes’s government intervention to stabilize the economy. Their views reveal capitalism’s adaptability, inconsistencies, and external impacts on economic stability. I reaffirm my claim that Schumpeter’s capitalism, driven by innovation and flexibility, can sustain social growth. Capitalism’s ability to develop and evolve mitigates its contradictions and improves its adaptability, contrary to Marx’s forecasts of its collapse and Keynes’s reliance on government intervention. Understanding capitalism’s complexity and its effects on civilizations globally requires considering and analyzing diverse perspectives like those of these renowned philosophers.

References

Clift, B., & McDaniel, S. (2021). Capitalist convergence? European (Dis?) Integration and the post-crash restructuring of French and European capitalisms. New Political Economy, 26(1), 1–19. https://doi.org/10.1080/13563467.2019.1680963

Herr, H. (2022). Transformation of capitalism to enforce ecologically sustainable GDP growth: lessons from Keynes and Schumpeter. European Journal of Economics and Economic Policies: Intervention, 19(1), 159–173. https://doi.org/10.4337/ejeep.2022.01.11

Marco, G. D. (2023). Marx’s general rate of profit: How turnover time, accumulation and rate of surplus value affect the formation of production prices. Capital & Class, 03098168231179975. https://doi.org/10.1177/03098168231179975

Muthusamy, S. K. (2023). Economic Growth, Inefficient Markets, and Economic Inequality. Inefficient Markets, and Economic Inequality (March 24, 2023). Available at SSRN http://dx.doi.org/10.2139/ssrn.4398568