A Critique of the analysis of Karl Marx within the BBC’s ‘Masters of Money’ Series

July 9, 2013 12:00 am Published by Leave your thoughts

I have just re-watched Stephanie Flanders’ (Economics Editor at the BBC) documentary series, ‘Masters of Money‘, which was aired last year, with much interest. The series consisted of three episodes on the most influential economists of the modern era: John Maynard Keynes, Friedrich Hayek and Karl Marx. Although Marx’s works preceded those of both Keynes and Hayek, the programme that was devoted to him was shown last, probably because whereas Keynes argued that capitalism needed to be managed and Hayek argued that the state should not interfere with capitalism, Marx argued that it needed to be dispensed with [1] .

The programme pertaining to Marx, which is the subject of this article, featured segments of interviews with a number of different people from public life, including Tariq Ali, David Harvey, Peter Hitchens, Tristram Hunt, Mervyn King, Lord Lawson, George Magnus, Madsen Pirie, Joseph Stiglitz and Slavoj Zizek. Flanders began the documentary by saying that she thought that Marx was ”a surprisingly good place to start for an explanation” of the recent financial crisis [2] . However, it was clear by the end of the programme that she and some contributors to the programme were sceptical about the Marxian explanation of the recent financial crisis. In addition, she stated that she did not think that Marx’s idea of an alternative to capitalism was plausible [3] . I intend to critique the statements made by Flanders and her contributors, concerning Marx’s ideas to show that the Marxian explanation of the origins of financial crises is correct and that the notion of an alternative to capitalism is not implausible. I have split the article into three sections: the first will pertain to the analysis of Marxian economics within the programme, the second will pertain to the comments within the programme concerning the viability of an alternative to capitalism and the third (which will conclude this article) will consist of a critique of Flanders’ remarks towards the end of the programme concerning whether capitalism works for everyone [4] .

Marxian Economics

As Flanders alluded to within the programme [5] , Marx believed that capitalism was an ”inherently unstable system built upon antagonisms that can only be resolved through changes which [will] eventually undermine it” [6] . Flanders recognised that Marx believed that it was the capitalists search for profit which ultimately paved the way for the downfall of the capitalist system [7] . She stated that the quandary for capitalists is that if they pay workers too much they will go out of business (as their competitors will not be so generous), but if they pay workers too little, they will not have enough money to buy the commodities that the capitalists are producing [8] .

Flanders noted that real earnings are flat and have been falling in the UK for at least 10 years and in the US since the 1970’s [9] (as David Harvey has stated ”for the first time in US history, working people have failed to share in any of the gains from rising productivity” [10] ). The Fordist-Keynesian regime that was in place after the Second World War broke down in the 1970’s [11] and union power has dwindled (in the 1980’s Reagan, Thatcher and others used state power to crush labour [12] ). The enervation of unions enabled employers to squeeze pay and hence ensure profits [13] . Flanders asserted that the problem of low wages was circumvented by consumer credit [14] . As Stiglitz said within the programme, it enabled people whose income was declining to spend as though it were still increasing [15] . In this context of cheap credit, mortgages in the US began to lend to riskier clients who were ultimately not able to pay, causing the sub-prime mortgage crisis triggering a global recession. As Magnus has averred:

Before 2008, the income disparity was obscured by factors such as easy credit, which allowed poor households to enjoy a more affluent lifestyle. Now the problem is coming home to roost” [16] .

I note that other factors have often been blamed for the crisis. Slavoj Zizek has stated that it is the central task of the ruling ideology to blame ”the meltdown on secondary and contingent deviations” such as lax legal regulations and corruption rather than the global capitalist system itself [17] . In my view, Marx was right about the intrinsic volatility of the capitalist system and it is this which we must analyse to understand the recent financial crisis. It is in the interests of the bourgeoisie to try to make it seem otherwise.

I believe that the account of Marxian economics given within the programme was overly narrow and simplistic, although I recognise that Flanders only had one hour in which to describe it. It is a shame that David Harvey was not featured on the programme more extensively (the two clips of interviews with him that were shown within the programme were of an extremely short duration). His excellent book ‘The Enigma of Capital‘, draws on the work of Marx, and reveals that crisis formation within capitalism is due to the limits and barriers of capital ”any one of which can slow down the flow of capital causing a crisis” [18] . Such limits include natural limits (such as scarcities within nature) [19] , disproportionalities within capital reinvestment [20] and labour scarcity [21] . Harvey believes that the recent financial crisis started because wage repression engendered a lack of effective demand which was ”papered over by a credit fuelled consumerism of excess in one part of the world and a too rapid expansion in new product lines in another” [22] . I believe that if Flanders had considered more comprehensively the limits and barriers to capital identified by Harvey, she and her viewers could have been left in no doubt about the volatile nature of capitalism and hence the veracity of Marxian economics.

An Alternative to Capitalism?

At the start of the programme, Flanders stated that she was a student in 1989 when the communist regimes in Eastern Europe began to collapse [23] . She opined that such regimes had not produced either freedom or prosperity and that as Marx had been the inspiration for such regimes, his reputation ”lay in ruins” [24] . I believe that Flanders has erred in this regard as the fall of the state socialist [25] regimes in Eastern Europe does not, in my view, impact on Marx’s analysis of capitalism and his prediction of a future communist society. Marx’s friend and collaborator, Frederick Engels, wrote that

”…the communist revolution will not merely be a national phenomenon but must take place simultaneously in all civilized countries – that is to say, at least in England, America, France, and Germany” [26] .

Thus the state socialist regimes were not what Marx envisaged, rather he saw communism as arising from advanced capitalism. As Terry Eagleton has highlighted ”if you attempt to build socialism in wretched economic conditions [as was the case in Eastern Europe] you are very likely to end up with some species of Stalinism” [27] . Marx ”had hoped that Russia might act as a sort of detonator” [28] and spark proletarian revolutions elsewhere, but this did not occur. Flanders remarked later within the programme that there had been no revolutions in rich developed nations, which is where Marx believed that they would occur [29] . I believe that, on reflection, she would concede that the fall of the state socialist regimes does not hinder Marx’s reputation.

Flanders seemed bemused that Marx had little to say about the future communist system that he predicted would follow capitalism. She said that it was ”telling” that Marx was unable to describe a convincing alternative to capitalism [30] . Within his contribution to the programme, Tariq Ali speculated that Marx may have written a lot more about what socialism would have been like if he had lived longer [31] . Slavoj Zizek stated that he believed that it was not up to Marx to provide us with a ”blueprint”, rather he ”opened up the field” and that ”it is up to us” to construct an alternative [32] . I agree with Zizek, as communism implies that communities collectively make decisions rather than religiously following the pronouncements of one person. If Marx had given an overly prescriptive description of a communist society, this would have been contrary to the very communitarian values that he espoused.

Within his input to the documentary, Peter Hitchens poured scorn on the notion of an alternative to capitalism, saying that it was akin to saying that there could be ”an alternative to weather” [33] . Similarly, Lord Lawson stated that he thought that Marx was completely wrong in considering capitalism as ”merely a phase” [34] . This is belied by Marx’s historical (or dialectical) materialism, which Flanders briefly alluded to within the programme, and which Peter’s brother, the late Christopher Hitchens, subscribed to. In showing that different epochs of human society have been determined by different modes of production, Marx revealed that ”nothing is eternal and unchangeable” [35] . Peter Hitchens averred that it was wrong to consider capitalism as a system, rather he believes that it is a ”fact of life” [36] . I am sure that the same was said of feudalism during the Middle Ages.

Hitchens also stated that, in his view, Marxists, in seeking to transcend capitalism, were trying to alter human nature [37] . His Burkean conservative dispositions were patent when he said that the problem with utopia is that it ”can only be approached across a sea of blood and you never arrive” [38] . I believe that humans are naturally less individualistic than Hitchens’ comments imply. In addition, I reject Hitchens’ imputation of Marx being utopian, as unlike some of his predecessors (utopian socialists such as Robert Owen, Charles Fourier and Claude Henri Saint Simon) Marx’s views are derived from a ”feasible extrapolation from the present” rather than ”idle speculation” [39] . Marx understood that class struggle is fundamental to human history [40] and that in the current epoch, the battle is between the bourgeoisie and the proletariat. He believed that due to the unstable nature of capitalism, it would veer from crisis to crisis. Once ”capitalism has definitively failed, working people will have no reason not to” institute communism [41] . The transition from capitalism to communism could be a peaceful one, and I hope that it is, though, as Eagleton has highlighted, states responses to protests rarely are, while the small propertied class is unlikely to give up its privileges without a fight [42] .

Slavoj Zizek stated, within the programme, that the only real utopia is to think that things can go on indefinitely the way they are now [43] . The problem is that the left were unable to provide an alternative in the wake of the global downturn [44] . Lord Lawson opined that he was surprised that there had been no rush to Marx after the recent economic problems [45] , though there has been a well documented surge in people reading his books [46] . It is difficult to predict how long the capitalist epoch will last. Marx was fully cognizant of the adaptability of capitalism and hence the accusation that he got it wrong because capitalism has not yet been replaced by communism is, I believe, a non-sequitur. Capitalism has had a tremendous impact on the world being, together with new technology, the catalyst for increased globalisation, which could in turn sow the seeds for the end of capitalism. As Fredric Jameson has asserted:

”That a new international proletariat (taking forms we cannot yet imagine) will re-emerge from this convulsive upheaval it needs no prophet to predict: we ourselves are still in the trough, however, and no one can say how long we still stay there” [47] .

At some point in the future, an incurable crisis will occur within capitalism, despite the efforts of the bourgeoisie to solve it [48] . Such efforts will form the terrain upon which such an international proletariat will organise ”to demonstrate that the necessary and sufficient conditions for the accomplishment of certain historical tasks [i.e. the overthrow of capitalism] already exist” [49] . Unfortunately, although I believe that the terrain exists for forces to mobilise against capitalism, at the moment a cohesive international proletariat does not.

Can capitalism work for everyone?

At the end of the programme, Flanders suggested that if capitalism cannot work for everyone, it may not work at all [50] . I agree with Terry Eagleton who stated within his book ‘Why Marx is Right‘ that ”although capitalism has led to great material advancements it has yet to demonstrate that it is capable of satisfying human demands all round” [51] . Flanders seemed to suggest that capitalism should be given the benefit of the doubt and that if it is still here in one hundred years time, people will be speaking of Marx less [52] . My own view is that if capitalism is still with us in a hundred years, it will still be beset by crises for the reasons outlined above. As a consequence, Marxism will continue to be relevant. Rather than giving capitalism the benefit of the doubt, working people should think more critically about the sort of society that they want to live in and how to arrive at that society.

[1] Flanders, S. Masters of Money, BBC1, London, 1 October 2012.

[2] Ibid

[3] Ibid

[4] Ibid

[5] Ibid

[6] Giddens, A. (1971) Capitalism and Modern Social Theory: An Analysis of the writings of Marx, Durkheim and Max Weber. Cambridge: Cambridge University Press, p59.

[7] Flanders, S. Masters of Money, op cit., n.1

[8] Ibid

[9] Ibid

[10] Harvey, D. (2010) The Enigma of Capital. London: Profile Books Limited, p12.

[11] Harvey, D. (1992) The Condition of Postmodernity. Oxford: Basil Blackwell Limited, p165.

[12] Harvey, D. (2010) The Enigma of Capital, op cit., n.10 at p15.

[13] Flanders, S. Masters of Money, op cit., n.1

[14] Ibid

[15] Stiglitz, J. Masters of Money, BBC1, London, 1 October 2012.

[16] Magnus, G. (2011) ‘Give Karl Marx a Chance to Save the World Economy’. [On-line] Available: http://www.bloomberg.com/news/2011-08-29/give-marx-a-chance-to-save-the-world-economy-commentary-by-george-magnus.html [Accessed: 30 June 2013]

[17] Zizek, S. (2009) First as Tragedy, Then as Farce. London: Verso, p19.

[18] Harvey, D. (2010) The Enigma of Capital, op cit., n.10 at p117

[19] Ibid at p72

[20] Ibid

[21] Ibid at p60

[22] Ibid at p118

Flanders, S. Masters of Money, op
cit., n.1

[24] Ibid

Pannekoek, A. (2003) Workers’ Councils.
Edinburgh: AK Press, p31.

Engels, F. (1847) The Principles of
.  [On-line] Available:
[Accessed: 30 June 2013]

Eagleton, T. (2011) Why Marx Was Right.
London: Yale University Press, p55.

Hobsbawm, E. (2003) Age of Extremes: The
Short Twentieth Century, 1914-1991
. London: Abacus, p57.

Flanders, S. Masters of Money, op
cit., n.1


Ali, T. Masters of Money. BBC1,
London, 1 October 2012.

Zizek, S. Masters of Money. BBC1,
London, 1 October 2012.

Hitchens, P. Masters of Money. BBC1,
London, 1 October 2012.

Lawson, N. Masters of Money. BBC1,
London, 1 October 2012.

[35] Rappoport,
C. (1908) The society of to-morrow.

[On-line] Available:
[Accessed: 30 June 2013]

Hitchens, P. Masters of Money op cit.,



Eagleton, T. (2011) Why Marx Was Right,
op cit., n.27 at p102

Ibid at p34

Ibid at p47

Ibid at pp186-187

Zizek, S. Masters of Money, op cit.,

Zizek, S. (2009) First as Tragedy, Then
as Farce
, op cit., n.17 at p16

Lawson, N. Masters of Money, op cit.,

B.B.C. (2008) Marx popular amid credit crunch [On-line] Available:
[Accessed: 2 July 2013].

Jameson, F. (1992) Postmodernism: Or, the
Cultural Logic of Late Capitalism
. London: Verso, p417.

Gramsci, A. (1991) Selections from Prison
. Hoare, Q. and Nowell Smith, G. Trans. London: Lawrence and
Wishart, p178.


Flanders, S. Masters of Money, op
cit., n.1

Eagleton, T. (2011) Why Marx Was Right,
op cit., n.27 at p10

Flanders, S. Masters of Money, op
cit., n.1


Categorised in:

This post was written by David Benbow

Leave a Reply

Your email address will not be published. Required fields are marked *