1) Marx claimed that the collapse of capitalism was inevitable. Has the recent history of Europe demonstrated that the truth really was that the collapse of communism was inevitable?
When one first thinks of communism, he/she thinks of oppression, corruption, and domination by the government. People sometimes claimed these unfavorable characteristics caused the downfall of the Soviet Union. However, little do they know that the main factor to the failure of the Soviet Union stems from the very idea of equality, which was brought up by Karl Marx. Throughout history, many aristocrats and land owners controlled the majority of the land and wealth in various countries, leaving the majority of the citizens poor. In most cases, a system in which a minority controlled the majority of wealth and power resulted in failures as poor citizens revolted and overthrew the minority in power.Karl Marx's ideology of Communism
Knowing the history before his time, Marx viewed a system in which the workers were exploited by a small group of wealthy capitalists as destined to fail. He stated that capitalism, which enriched the owners of capital at the expense of workers, was not sustainable in the long term. He argued that private ownership created economic inequality due to an unfair and inefficientdistribution of wealthand power. This made the rich get richer, and the poor get poorer. Moreover, he claimed that capitalism was only democratic for the elite and wealthy classes since freedom of expression for workers was limited by the fear of dismissal. He also argued that capitalism tended to create monopoly or oligopoly, states in which one or a few companies dominate the market. Lastly, he stated that capitalism created market instability as individuals pursue self interest at the expense of society as a whole. The unplanned and explosive growth of capitalism would not be stable in the long run as there would be periods of overproduction and stagnation. In Chapter 13 ofCapital Volume 3, Marx was convinced that the rate of profit must fall as competition in commodity and labor would lead to an increase in capital, which in turn will result in a falling rate of profit. This ultimately would lead to public dissatisfaction. Therefore, Marx believed that the collapse of capitalism was inevitable. However, through the recent history of Europe, we find the reverse to be the truth. Like what Will Roger said, "Communism is like Prohibition - It's a good idea but it won't work" (Will Rogers, 1927). We have discovered how equal labor rights and payment, one of the fundamental building blocks of communism, lead to economic inefficiency, starvation, political upheaval, migration, and eventually collapse.Incentives and Productivity
With capitalism growth dependent on private corporation and interests, an individual's success and prosperity is determined by his/her hard work and contribution. One of the characteristic of capitalism is that everyone has the right to pursue profit. However, with communism, the state controls the productivity and success of the country, and aims to bring equal prosperity to the whole population regardless of how hard each individual works or of what their merits may be. However, the problem is that not everyone is born with the same mindset. Some people are born with the ambition to succeed. They want to attain more things in life than they are given and are willing to work hard to reach their goals. On the other hand, some people are fine with living with an average life, in which everyone is treated equally. Communism hinders motivated individuals because it takes away their rewards and their incentives to succeed. On the other hand, it helps out the unmotivated people who are unproductive in the society. Because of the communist system, an individual lacks the incentive to work hard because there is no difference in pay. Due to a lack of incentives, there wasn't an urge for technological innovation in the communist states. The lack of incentives to work hard and innovate made the Soviet Union fall behind the western nations in terms of productivity.
However, in the 1920s, communism caused the Soviet Union to achieve rapid industrialization and modernization, but this growth came at a high cost. Stalin allowed some private enterprises to build factories in the Soviet Union and learned these private enterprises' techniques. He confiscated many stockpiles of grains from poor farmers to export them abroad and used them to finance industrial expansion, which starved millions of people to death. In order to achieve modern industrialization and economic growth, he forced many people to work as slaves to build machinery with sometimes no pay. After WWII, this method of economic growth by repression wasn't sustainable as the Soviet Union acquired more countries such as Poland and Czechoslovakia. It was harder for the Soviet Union to control and repress more people who weren't supportive of communism in these countries. Moreover, unlike in the 1920s, the Soviet Union excluded new technologies made by western nations to enter into the Soviet's market, thereby isolating itself from technological advancement. As a result, the productivity in the communist states was much lower than the productivity in other non-communist countries, which ultimately affected their economies. This table below shows the decrease in productivity for the Soviet Union. The industry value added by per Soviet worker had declined from 1928-1985.Low Productivity
The lack of competency and productivity in the labor market ultimately contributed to the failing of communist states' economies. The long term success of a nation's economy is determined by its productivity. The state run organizations couldn't compete with the foreign privately owned companies. For instance, in the automobile industry, the cars made by the Soviet Union were low quality, unreliable, and obsolete compared to the cars made by the American private car manufacturers such as Ford and GM. The government simply didn't have the capability and the specialties to run every operation efficiently. These factory workers built cars because they were told to do so by the government. There was a poor division of labor and an inefficient use of resource. Workers didn't innovate their cars because they knew that the government would purchase these cars no matter how they were made. As a result, the communist states' economies didn't grow as fast as the non-communist states and the people weren't getting richer. Back in 1930s, most countries in Europe had the same GDP per Capita. From 1938-1990, the GDP per capita in the Soviet States grew about 70-180%. On the other hand, the GDP per capita in other Western European Countries and the United States grew about 1000%-1450%. The standard of income and the purchasing power in the communist states had fallen relative to the capitalist nations.The Cold War and Collapse of Oil
In addition to the low productivity, the economy was also worsened by the Cold War and the sudden price drop in oil. In the Cold War, the Soviet government squandered an astronomical amount on war projects and governmental buildings in its competition with capitalist countries at the expense of its country's basic infrastructure such as public roads. The citizens of the Soviet Union wanted regular consumer goods such as leather boots or television sets instead of high tech weaponry and nuclear missiles. Eventually the Soviet Union was lagging behind the United States in terms of launching its intercontinental missiles. The US's missiles could reach the Soviet Union, but the Soviet's missiles couldn't reach the USA. In order to reach the USA by missiles, the Soviet Union set up a nuclear intermediate-range missile base in Cuba, which would provide a hindrance to a potential U.S. attack against the Soviet Union. Although the Cuban Missile Crisis was avoided, this crisis had caused the USA to increase spending on its space program. In the end, due to its poor economy, the Soviet Union had lacked the capital to compete with the US's Star Wars program, which made the Soviet's weapons obsolete. The arm race the Soviet Union had competed with NATO bankrupted its entire economy. Furthermore, in September 13, 1985, Sheikh Ahmed Zaki Yamani, the minister of oil of Saudi Arabia, stopped protecting the price of oil and increased its oil production. Consequently, this reduced the price of oil and devastated the Soviet's economy as it was dependent on oil for most of its revenue. The cost of the Cold War and the collapse of oil prices were additional blows to the already weakened Soviet economy.Food Crisis
The failures in the Soviet economy ultimately resulted in the shortage of food. Under Communism, starvation from food shortages caused more deaths than other forms of violence or oppression. Food shortages became a problem, and the crime rate began to skyrocket. The Soviet Union got most of their food from imports. Because of the weakened economy, food imports were reduced by $20 billion, the amount the Soviet Union had lost when oil prices collapsed. But in real terms, this option meant the introduction of a food quota at rates similar to those used in World War II. Due to the severe shortage of food, the war time system of distribution such as food stamps, which limited the amount of food each individual could receive, was reintroduced in the end of the 1980s. Instead reforming its communist system, the Soviet Union began to borrow money from abroad while its international credit rating was still strong. By doing so, it was able to purchase food for its citizens. Compared to 1985, the Soviet Union decreased its gold reserve from 2000 to 200 tons and increased it debt from 0 to 120 billion dollars. Furthermore, the state deficit increased from 0 to over 100 billion in rubles. In the end, the Soviet Union was largely in debt and couldn't provide its citizens with an adequate food supply.The instability of the communist system
The poor and starving public revolted against Communism and disrupted the political stability of the communist system. People didn't want to live in a poor nation that oppressed human rights. Under communism, all opposition parties were banned so there was no freedom of choice. Freedom to speak and publish was suppressed by communism.Internal Pressure
The Soviet Union was under internal pressure as people in the Soviet Union and Eastern Europe were discontent about how the system was run. In addition to food riots, there had always been political riots about free rights, higher wages and independence. With the influence from the Western Countries about the positive aspects of Democracy, many citizens in the communist states rebelled against the communist regime as it didn't give them the freedom to choose and speak. They were unsatisfied with how their countries were run by the communist party.
In 1953, the East Berlin Wall riot occurred and severely affected the stability of the Communist system. Over 40,000 workers protested on the street as their superiors planned to cut their wages. They claimed that their wages were already too low compared to the Western countries. This riot was eventually suppressed by the Soviet troops through physical force. In 1956, the Hungarians revolted against the Soviet Union. The Hungarians wanted free elections, the withdrawal of Soviet troops who persecuted anti-communists members, and theremoval of Hungary from the Warsaw pact. As a response, the communist party sent out the Red Army to flush out theresistance fighters. In the Hungarian revolt, an estimated 20,000 people were killed. The leaders of the communist parties sent out the Soviet Army to suppress the workers instead of compromising with them. In 1989, students and intellectuals protested at the Tiananmen Square in China to demand for economic change and democratic reforms. Over 100,000 students declared hunger strikes to express their dissatisfaction with the Communist Party of China. In the end, the Chinese government sent in its military to disband the protesters, which resulted in an estimated 300 deaths. The actual number of deaths is still unknown even to this day. The political stability in many communist countries appeared to deteriorate as upheavals were tearing these countries apart. The problem was that the communist government wasn't willing to negotiate with the protestors to reach a compromise, but was willing to use brutal force to suppress them. Many Western Analysts even speculate that civil wars might occur within the communist states.External Pressure
In addition to its internal pressure, the Soviet Union's political stability was also under external pressure by the US and other western European countries. Most western nations would consider the Soviet Union as the "Evil Empire", thereby giving it a bad image. Economically, many European countries became more integrated by the European Economic Community. They became more politically integrated by the Organization for Security and Cooperation in Europe, which promotes fundamental human rights and freedom. This caused a lot of citizens in the Warsaw Pact nations to envy their economic and political rights. Furthermore, there was an increasing political, economic, and military alliance among Western European Countries and the USA. Through the Marshall Plan, the USA helped alleviate trouble European countries by funding them with capital in order to impede the extension of the Soviet Union. Western European Countries and the USA also gave money to poor countries in Latin America and Southeast Asia to contain the spread of Communism. The North Atlantic Treaty Organization (NATO) was formed to counter the military power of the Soviet Union. In Vietnam and Korea, the NATO had taken military actions to stop the communist regime from taking over these two countries. Consequently, there were more countries that aligned themselves with the NATO than the Warsaw Pact. The collapse of Communism was inevitable as the vast majority of the populations in the communist states weren't supportive of its regime and many countries around the world refused to adopt the communist system.Migration
The political instability along with the dissatisfaction of the communist system had caused residents in the Soviet Union and Eastern European countries to migrate to Western Europe. There had never been a majority support for communism in a legitimate political basis. People didn't want to live in places where they were suppressed by the government. The citizens in the Eastern European countries along with the Soviet Union wanted to seek security, political freedom, and prosperity. They would climb over the Berlin Wall at the risk of getting shot just to reach Western Europe. There were many illegal immigrants who tried to escape from these countries into Western Europe or America to seek asylum. Although the communist party wanted to prevent the migration of people away from the communist states, it couldn't prevent everyone from leaving the states due to its limited border control. In 1956, nearly a quarter of a million people left the country during the brief time that the border in Hungary was opened. In August 23, 1989,Hungaryfirst removed its physical border defense with Austria. In September, more than 13,000 East German tourists in Hungary escaped to Austria and West Germany. This set off a chain of events. The Hungarians prevented many more East Germans from crossing the border and returned them to Budapest. In the end, because there were so many immigrants, German Democratic Republic was powerless to stop them from entering. Honecker, the East German leader, resigned under pressure as he wasn't able to stop the migration away from East Germany. Therefore, this shows the collapse of communism was inevitable as people in eastern European countries would do anything to escape from the communist regime.Reforms and Collapse of Karl Marx's ideology of Communism
By the end of the 1980s, the leaders of communist nations had to change their original political system to lean more towards capitalism in order to sustain its economy. The original communist system wasn't capable of supporting its own citizens economically. There were increasing calls for independence among the communist bloc countries that had never been truly supportive of the communist regime. This contributed to the fall of communism in Europe. In 1989, the collapse of the Berlin Wall was the first sign of the ending for communism. This broke the Iron Curtain that separated Eastern Europe and Western Europe for decades and reunited East Germany with West Germany. Many people of East Germany immediately moved to West Germany to escape from Communism. In 1989, Mikhail Gorbachev, the last General Secretary of the Communist Party of the Soviet Union, declared that the Soviet Union should pursue the road to democracy and dissolved the central committees. The Soviet Union was then broken up into many different states, thereby ending the Cold War. The immediate collapse of the Soviet Union symbolizes the further disintegration of the communist system. Countries that were previously governed by the Communist Party such as Russia, Estonia, and Hungary are no longer communist. China, one of the last communist countries, has undergone several reforms from the original communist regime proposed by Karl Marx. It now leans more towards capitalism as it doesn't want to suffer the same fate as the Soviet Union. Therefore, as we have seen in our recent historical events, Communism, not Capitalism, is inevitably going to fail. It has been built on coerce, terror and undemocratic methods and inherently conflicts with the basic incentives of human nature.
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