Karl Marx (Part 1)

The theory of economics throughout the ages

Karl Marx (1818-1883)
The name Karl Marx instantly brings to mind different ideas. We all associate him with communism, so he's something of a misunderstood figure in the U.S. Many people instantly disagree with any Marxist idea, often without even knowing why. The truth is: Marx was a brilliant economist, and even if you disagree with his political or economic ideas, it's still a good thing to understand them. Marx had a great impact on the events of the twentieth century, and will continue to have a lasting impact on world thought.
One more note: don't associate Marx with the Soviet Union! Marx was a German, not a Russian, and was completely separate from the events in Russia (which occurred after he died). The Soviet Union was formed by people who believed Marx's ideas but, for the most part, used them to achieve their own personal goals. As an experiment in communism, of course, the (former) Soviet Union was a dismal failure.
We'll concentrate on Marx's economic ideas, not his political ones, here, although at times the two will overlap.
Marx was probably one of the most widely read men in history; he read practically every economic work of any importance ever published up to his time. He was influenced by the ideas of the French Revolution, the Industrial Revolution, and the revolutionary philosophical ideas in Germany (as put forth by Hegel and others).

Germany had been largely unimportant in Europe since the Thirty Year's War left it devastated in 1648. The Holy Roman Empire, which was basically modern Germany and Austria, lost power. In the 1800s, Prussia, an area in the northern part of Germany, began to gain power, and eventually defeated even the mighty France, the dominant nation in Europe since the reign of Louis XIV, despite all of its iternal turmoils. The nation of Germany was just emerging into the limelight during the time of Marx.
Let's try to explain Marx's ideas simply, without resorting to obscure economic terms:
Marx was interested in history, and why events unfolded as they did. Based on the philosophy of Hegel, which he combined with the idea of "matter over mind," or materialism, he concluded that economic forces are what drives historical events, and that this economic "base" is the foundation for all of society (the "superstructure"). This history-as-a-skyscraper model led to his idea that it is "stuff" that leads to consciousness and thought, that all our ideas and actions are determined by our interactions with other people in order to obtain goods. The material conditions formed by the "base" lead to economic classes. Some people are going to have more "stuff" than others, and so in the end some people are unhappy. Eventually we end up with a landholding class (like in medieval Europe, the feudal lords who owned everything and determined who could work there land), and this landholding class would eventually lose its power to businessmen, just the way towns eventually took over from medieval Europe. Now, as towns get more power, there will be more factories, and there will have to be people to work in the factories. The more commercial the economy, the bigger the working class, or proletariat. These working-class people have to put up with bad conditions, and, with the commercial class (the bourgeoisie) fighting to get more of the market and make money, the proletarians can take over. In 1848 Marx thought this was about to happen, with a series of revolutions in Europe, but it didn't. The bourgeois remained firmly in place, and the working-class remained in much the same political condition.
This has been a greatly oversimplified account of Marx's ideas, but it gets the point across.