The founding father of communism and creator of the command economy

Early Life

Karl Marx was born in 1818 in the town of Trier in Germany to a Jewish family. However, the family were only Jewish by name, as they were fairly non-religious, even when converting to Christianity in Marx’s early childhood. His father was a lawyer earning a comfortable upper-middle-class income as well as owning multiple vineyards, so the family was quite wealthy. He was the third of nine children and was the eldest son after the death of his older brother Moritz in 1819, and was privately educated by his father until 1930 when he entered the German equivalent of a grammar school, which is a Gymnasium, called Trier High School.

Education

In 1835, at age 17 Marx would begin studying at the University of Bonn, where he read law. However, he wanted to study philosophy and literature but was dissuaded by his father who considered law a more practical course for his future career. Although his grades were good to begin with, they began deteriorating and so his father took it upon himself to force a transfer to the more academic University of Berlin to allow his son to improve. This worked and in 1836 Marx became serious about his studies, focusing on writing and learning while also taking an avid interest in philosophy, despite studying law. His doctoral thesis was very left-wing and as a result very controversial, especially with the conservative professors of Berlin University, so Marx instead submitted his thesis to the University of Jena, who awarded him his PhD in 1841.

Published Works

Marx’s two most influential works are Das Kapital (1867) and The Communist Manifesto (1848). Both of these books are complementary to the other – Das Kapital is a criticism of the capitalist society that Marx lived in and highlighted all the problems that caused pain and suffering in the lower classes, and how the upper classes behaved greedily to maximise profit at the cost of the workers. Marx was against business owners simply making money off the labour of the worker and considered their role unnecessary as a middleman, preferring the labourer to earn the true value of their work. To accompany this, The Communist Manifesto provides the solution in the form of communism, where the produce of the nation is distributed equally with everyone enjoying the fruits of their labour fairly, and everyone that wants a job will have one. Marx was an avid author and wrote many books, many co-written with his good friend and fellow academic Frederick Engels, who also helped with The Communist Manifesto.

How did Marx think economies should be run?

Marx’s theories can be interpreted through many different lenses –  philosophical and historical, and economic. He believed that society would inevitably divide itself into two classes in a capitalist system – the business owners and the workers. The workers would produce the material goods and conduct all the labour, while the owners would reap all the financial and social benefits. Marx’s analysis centred around the social cost of giving up the value and ownership of one’s own labour to the owners. He further explored what that would ultimately mean for society and the purpose of life for those working as the means of production in factories and other outfits. He would often explore and analyse what would drive the workers if they did not own their labour. Behavioural economics attempts to, among other things, determine whether the economic theory of profit maximisation and capitalist gains are overall indicative of what people do or want. In many ways, Marx argues against profit maximisation and the capitalist economic system and believes in many socialist ideas and principles that seek to return the benefits and fruits of labour to the individual.

In his opinion, the ideal scenario does not seek to maximise a behavioural economic system that promotes maximum profit and productivity but instead empowers the worker and returns control of their lives to them. He believed that capital allocation created the social-economic system in which we live our lives. Also, he proposed that allowing a massive distribution of capital that was skewered to one end of society could define how society is constructed. Society would end up with a negative social system and behaviours. Ultimately, Marx’s theories were just that – theories. Every attempt at applying it led to corruption, misallocation of resources and collapse of the nation that tried it, as Marx had designed the perfect system for the ideal species, which sadly humans failed to be – he was unable to account for the personal ambition and greed that plagues all humans, and so his ideas could never be used entirely. However, some of the values can and have been revolutionary in growing the economy, and so Marx was still a key economic figure in that sense.

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