MARX AND LENIN ON CAPITALSIM

2.3 Political Science II

Submitted by

Shreya Raulo

Unique ID

SF0118050

Batch of 2023

Faculty-in-Charge

Dr. Mayengbam Nandkishwor Singh

National Law University, Assam

3rd May, 2019

 TABLE OF CONTENTS

1. INTRODUCTION
1.1 SCOPE AND OBJECTIVES
1.2 RESEARCH PROBLEMS
1.3 RESEARCH METHODOLOGY
1.4 LITERATURE REVIEW
2. RATIONALE BEHIND MARX’S IDEAS ON CAPITALISM
3. RATIONALE BEHIND LENIN’S IDEAS ON CAPITALISM
4. CORRELATION OF MARX AND LENIN AS MARXIST-LENINIST THOUGHT
5. CONCLUSION
6. BIBLIOGRAPHY
 1. INTRODUCTION

Rosa Luxemburg, referring to the Russian Marxists, stated: “It is interesting to observe that
Russian Marxists are developing more strongly into ideological champions of capitalism.1” Her
prophecy has been verified by the events that followed. When in power, Marxist-Leninists in
historical and pragmatic terms, have proven the veracity of Luxemburg’s statement. It is equally
applicable to non-Russian Marxists, such as Euro-Communists and Social Democrats who,
without scruples, are also openly assuming the role of champions of capitalism. Naturally some
Marxist scholars will question and even object to the truth of the foregoing statements, despite
the fact that “Russian society, like Eastern European societies, China etc. is an asymmetrical and
antagonistically divided society – or, in traditional terms, a ‘class socie2y’2.” These objections
are based on the ahistoricity of the historical method of social analysis. Used as a tool to dissect
bourgeois reality and thus prove its bankruptcy, it is denied the same status in relation to
MarxistLeninist historical reality, which, in socialist terms, is the greatest ideological fraud
perpetrated in the 20th century. On the other hand, it may be justly argued, that the socialist
scholars, bearers of the classless order, have a vested interest as a new class in obscuring and
manipulating issues, in falsifying history, suppressing evidence and deceiving for their own
benefit.

To err is human, but when this is combined with the van-guard role, the spirit of elitism and the
urge to dominate, it becomes a conspiracy of scholars, conscious or unconscious, to minimize the
evils of Marxist-Leninist bureaucratic capitalism and to present it as an attractive alternative to
western style capitalism. Whatever the case, Marxism-Leninism is a capitalist orientated
movement. “The enslavement of the workers at the workplace is not merely an important or
secondary ‘defect’ of the system, nor merely a deplorable and inhuman trait. Both, on the most
concrete as well as on the philosophical level, it denounces alienation as the essence of the
Russian regime. Strictly in terms of the labour process, the Russian working class is just as
subject to a ‘wage’ relation as any other working class. The workers have control of neither the
means not the product of their labor, nor of their own activity as workers. The ‘sell’ their time,
their vital forces and their life to the bureaucracy, which disposes of them according to its

1
Georg Lucacs, History of Class Consciousness, Ashbury, London, 1971. P.26
2
Conrelius Castoriadis, The Social Regime in Russia, in Telos 38, 1978-79, Washington University, St Lois. U.S.A.
p.32
interests. The constant effort of the bureaucracy is time decreasing its remunerations – and this
by the same methods used in the West.3” This is true of the Soviet Union as well as China and
other communist countries.

1.1 SCOPE AND OBJECTIVES

The scope of the project is limited towards a critical understanding of the various thematic
and political factors at play in determining Marx’s and Lenin’s revolutionary ideas on the
facet of capitalism and how they’ve come to assume such significance even in the world of
modern literati as well as the modern sphere of international poltics.

The objectives of the researcher are three fold:

 To understand the rationale behind Marx’s school of thought;

 To critically evaluate the importance of Lenin’s political construct;
 To appreciate the socio-political additions made by Marx and Lenin to the
international scenario.
1.2 RESEARCH PROBLEMS
 What makes Marx’s ideas realistic in a political narrative?
 How are Marx and Lenin distinctively different from utilitarian or capitalist ideas?
 What are both’s specialties in a changing world of political dynamism?
1.3 RESEARCH METHODOLOGY

The doctrinal method of study has been adopted. The researcher has subscribed to a set of
primary sources in the form of books and journals. Plus, a number of websites, blogs,
newspaper articles and other secondary sources have been referred to.
1.4 LITERATURE REVIEW
 Georg Lucacs, History of Class Consciousness, Ashbury, London, 1971. P.26-
The usage of class struggle is significant. As it is believed, the author tries to
define class with oppression and as a result, he reaches a well-prepared, easy to
read narrative for his readers. Details in descriptions may be considered as a result

3
Rapporto Veridico, Censor, Milano, Italy, 1975. P. 51
 of this major word class usage; however the author does not avoid using minor
ones such as socialism and bourgeoisie bias alike. Both simple and complex
words and historical allusions are used in this story. There is some evidence to
conclude that he is a master of his own craft in realpolitik.

2. THE RATIONALE BEHIND MARX’S IDEA ON CAPITALISM

The main conclusion of Marx’s theory of surplus-value is of course that surplus-value is
produced by the surplus, unpaid, labor of workers. In other words, wage-laborers in capitalism
are exploited, just like serfs in feudalism and slaves in slavery – they all perform surplus labor
gratis for the owners of the means of production. Divided, atomized, alienated and unable to
communicate with each other, people are easily manipulated and governed. The old adage of the
Roman ruling class “divide and rule”, summarizes the function of hierarchy. Cleverly used by
the bourgeoisie, it has been perfected as a weapon by the Marxist-Leninist society based on sado-
masochistic relationships which are necessary prerequisites for political, economic and personal
enslavements. What is unique about capitalism is that this exploitation is less obvious, because of
the initial exchange between capitalists and wage laborers (the purchase and sale of labor-
power), which appears as an exchange of equivalents. However, Marx’s theory shows that this
exchange on the market is only the first phase in the relation between capitalists and wage-
laborers; the second phase is the “hidden abode” of production, in which workers produce more
value than they are paid, and therefore are exploited. Thus Marx’s theory of surplus-value serves
to uncover the reality of exploitation beneath the appearance of equal exchange4.
As the researcher, I think this theory of surplus-value and exploitation is a large part of the “heart
and soul” of Marx’s theory and critique of capitalism. Marx’s theory of surplus-value destroys
the prevailing ideology (supported by neoclassical economics) that capitalism is “fair and just”,
i.e. that all the market exchanges in capitalism – including most importantly the exchange
between capitalists and workers – are the exchange of equivalent values, in which each party
receives a value equivalent to what they contribute to the exchange.
In particular, workers receive in wages a value equivalent to their contribution to the value of
the output. Marx’s theory provides a devastating critique of this powerful, pervasive ideology.

4
Karl Marx and Frederick Engels, Manifesto of the Communist Party, London 1948, p. 61
To lose all this (or to deemphasize it because of a supposed connection between this theory of
surplus-value and market socialism would be a big mistake5.
In addition, most of other important conclusions of Marx’s theory are derived in one way or
another from his basic theory of surplus-value. These important conclusions include: inherent
conflicts between capitalists and workers over the length of the working day and over the
intensity of the workers’ labor, inherent technological change, rising rate of surplus-value and
increasing composition of capital, falling rate of profit, and recurring crises. All these important
conclusions follow from Marx’s theory of surplus-value, according to which surplus value
depends on surplus labor.
The question of the state was then acquiring particular importance both in theory and in practical
politics. The imperialist war had immensely accelerated and intensified the process of
transformation of monopoly capitalism into state monopoly capitalism6. The monstrous
oppression of the working people by the state, which was merging more and more with the all
powerful capitalist associations, was becoming increasingly monstrous. The advanced countries
we mean their hinterland were becoming military convict prisons for the workers. Such a
horrendous socio-political deadlock made Marx come up with the central thematic idea of
“surplus value”. The Russian working class under Lenin's leadership, applying the inviolable
Marxist tool of "concrete analysis of concrete conditions", converted the possibility of Marx’s
ideas of surplus value into an epoch-making reality.
Marx’s theory still provides a determinant quantative theory of price, in which prices are
determined by values (i.e. by quantities of abstract labor). Values are determined independently
of prices (by the socially necessary labor-time in production) and then determine prices. There is
a causal relation in Marx’s theory running from values to prices, even though values and prices
are not independent and dependent variables in the usual sense of the terms. (It should be noted
that the prices that are explained in Capital by Marx’s labor theory of value are long-run,
average, center-of-gravity prices, not actual market prices in any given period7. In other words,
Marx’s labor theory of value assumes supply is equal to demand and no realization problems, in
order to analyze capitalism “in its pure state”.)
5
Sitaram Yechury, “How Marx Changed Surplus to Superb?”, 15(4) The Marxist, 2000
6
Cornelius Castoriadis, Op. Cit.

7
Enrique Dussel , “The Four Drafts of Capital: Towards a New Interpretation of the Dialectical Thought of Marx.
Rethinking Marxism”, 15 Journal of Dialectics and Politics(2001)
 3. RATIONALE BEHIND LENIN’S IDEAS ON CAPITALISM
As per Lenin, The concentration of capital and of production in the hands of fewer and fewer
firms follows inevitably from the social conditions of capitalist production, among which the
most general are (a) the social division of labour from which springs the differentiation of the
various branches of production, and (b) private ownership of the means of production. Given
these things and competition exists in its germinal form. Given the further development of (a)
commodity production and (b) the appearance on the market of labour-power as a commodity,
and the conditions exist for the development of competition into its capitalist form. Capitalist
production bursts the bounds which constrained competition and made it an essential and a
universal condition of production. Competition imposed upon each capitalist owner of means of
production the need to cheapen the production of commodities. In other words, it made it
imperative for each capitalist firm to produce on a higher scale, i.e., with larger masses of better
organised and more thoroughly exploited workers equipped with more mechanised instruments
of production. In short, capitalism both extended and intensified competition, and with it the
elimination of the less well-equipped producers. The logical end of this elimination could be
none other than one solitary ultimate victor. Concretely, however, certain difficulties must be
overcome before this end can be attained. The field of direct competition is divided into different
branches of production and a number of different centres (local and national markets which only
in their aggregation constitute a world market). Thus before a lone survivor could be reached on
a world scale, lone survivors must first have been evolved in each of these branches of
production and in each of these centres. But the evolution of an absolute monopoly in any one
branch of production (steel production, say) on a world scale cuts across and conflicts with the
evolution of a monopolist control of any local or national market, or economy. Thus the
tendency towards monopoly, the more sure and certain it becomes, cannot realise itself in a
smooth, linear fashion but must proceed dialectically, i.e., by the creation and progressive
surmounting of a whole series of violent antagonisms. Moreover, since the rate of development,
owing to physical, historical and political conditions, as well as economic ones, cannot help but
vary from time to time, from industry to industry, and from country to country, the force and
complexity of these antagonisms and their dialectical consequences cannot help but be multiplied
beyond all reckoning.
Hence, although the tendency towards monopoly must be recognised as an absolute law of
capitalist production, it by no means gives grounds for the utopian reformist-socialist dream of a
peaceful transition, through a regular process of “inevitable gradualness”, from capitalist
competition to a world monopoly (or a number of national monopolies) which could be
peacefully “taken over” by the state “on behalf of the people”. If the process is viewed not in its
abstract unity, but in its concrete and multiform totality, it will be seen that the tendency toward
monopoly is one that can only realise itself approximately, and never absolutely, since in its
concrete forms each detail tendency engenders a resistance to itself which can only be
transcended by engendering resistance on a higher plane, and so on, progressively, until a crisis
either of war or of social revolution (or of both) is precipitated8.
In other words, while the tendency towards monopoly does in fact involve the negation of
competition within a number of spheres of production and exchange of commodities, it produces
at the same time over the whole field of capitalist economy, and still more over the whole field
of bourgeois society, an intensification of competitive antagonisms, so that the (approximate)
attainment of monopoly, instead of eliminating competition (and antagonism) from society, on
the contrary, raises them progressively to a higher and more destructive scale. This is seen most
clearly when it is borne in mind that competition is of many kinds9. There is, for example, the
general competition between those who buy and those who sell, as well as the competition of the
sellers and buyers among themselves. The elimination of competition among the sellers, instead
of eliminating competition among the buyers, only intensifies these latter forms of competition.
The tendency towards monopoly is concretized into a system with the emergence of a new
category of capital, that of finance capital. This again gives an example of the transformation of
quantity into quality. As a capitalist industrial enterprise (in steel production, for example) rises
to a position of monopolistic dominance in its specific industry it finds itself, as trade fluctuates,
at one time possessed of more money capital (realised profits) than it needs for the expansion of
its business and, at another, faced with emergency needs for fresh money-capital. In the one
phase it invests its surplus in bank capital; in the other it gives a share in its capital to the bank in
exchange for a loan.

8
V.I. Lenin, Imperialism, The Highest Stage of Capitalism, Pekin, 1970. P. 10
9
Fred Mosheley, Lenin’s Economic Theory: True or False? A Central Idea, 30(1) Valperaiso Social Journal, P. 132
Monopoly capitalism, the Leninist will argue, “has grown out of colonial policy.10” Yet,
paradoxically as it may sound, state socialism has grown out of colonial policy. In the first place,
the party is the colonizer of the workers – the colonies; in the second the biggest state absorbs
and economically exploits the small ones, e.g. Russia and its Satellites. The order is colonial too:
the summit, the center, the bureaucracy are essential structural features to which the subalterns
are workers, peasants and provinces, The socialist monopoly can be represented as an octopus
whose head is in Moscow, or for that matter in Peking, while its tentacles are in the factories, in
the fields, in the provinces, in the small states sapping the energy of the workers and peoples and
suffocating any attempts at self-determination, self-assertion and independence. This makes the
Marxist-Leninist State the zenith of monopoly capitalism, because the unity of economic
exploitation and political enslavement is achieved. The words Lenin uttered against monopoly
capitalism: “striving for domination instead of striving for liberty11”, are a proper description of
socialist capitalism. Once monopoly capitalism and the state merge into state monopoly
capitalism, capitalism becomes more virulent, aggressive and expansionary and reaches the final
stage, imperialism, which is “the exploitation of small nations but a handful of the richest and
most powerful nations.12” What an ironical indictment of Lenin is the state Lenin has created.
Now, if Marxist-Leninist Statist monopoly capitalism is a perfection over its bourgeois
counterpart then, it follows, Leninist imperialism is a rather more perfect and atrocious form of
oppression and exploitation. It is not accidental that the multi-nationals find it profitable to pump
millions of dollars into socialist economic system to ensure its blood circulation. State socialist
economies are reliable and pay secure dividends.
main aspect of Lenin‟s third point, about the export of capital becoming much more important
has certainly been borne out as correct over the past century. In 1897 the U.S. had only $700
million total investment abroad; by 1914 (just before World War I) this had jumped to $5
billion—a growth of more than 600% in less than 17 years. This continued to expand rapidly
(except during the Great Depression) to $54.4 billion in 1950, and $166.9 billion in 1970. By
1990 U.S. direct investment abroad had reached $629 billion. 17 And by the end of 2003 the
U.S. “direct investment position” abroad reached $1,788,911,000,000.00—that‟s more than 1.7

10
Ahmed Bin Taheri, “Refurbishing the Proof of Lenin’s Construct: A Meta Political Analysis”, 12(2) PMIMER
Journal(2007)
11
Paul Baran & Paul M. Sweezy, “Monopoly Capital”, NY: Monthly Review Press, 1996
12
U.S. News & World Report, Dec. 14, 1998, pp. 26-27
trillion dollars!18 Moreover, in the one year of 2004 this U.S. direct foreign investment
increased by a further $248 billion, bringing the total to nearly $2 trillion!13

4.CORRELATION OF MARX AND LENIN’S IDEAS

Since each mode of production corresponds to definite social relations within the fram work of
capitalism. Marxist-Leninists distinguish various stages of capitalist development. Some of them
are laissez-faire capitalism, monopoly capitalism and imperialism. The latter according to Lenin,
“is the eve of Social Revolution of the proletariat,” and definitely proves “the truth of the
teaching of Karl Marx in concentration.” It proves the truth of the concentration of power and
capital in the socialist State but it does not prove the advent of socialism and the classless
society. On the contrary, the concentration of capital and the centralization of power in the hands
of the Marxist-Leninists State proves the greatest victory of monopoly capitalism; a prelude to
socialist imperialism. But socialist imperialism is not a step nearer to socialism and classless
society. “Thus what they retain of Marx is only the metaphysical and deterministic account of
history: there is supposed to be a predetermined stage in history of mankind, socialism, as the
necessary sequel to capitalism. But socialism is not a necessary stage of history, It is the
historical project of a new institution of society whose content is direct self-government,
collective management and direction by all humans of all aspects of their social life, and explicit
self-institution of society.14” Economic concentration and centralization of power lead to a heavy
bureaucratizations of life and a rigid hierarchically structured society. Hierarchy is the matrix of
the authoritarian social order. It divides people into categories: masters and slaves, order-giving
and order-obeying, husbands and wives, parents and children, intellectuals and workers,
apparatchiks and citizens etc. Divided, atomized, alienated and unable to communicate with each
other, people are easily manipulated and governed. The old adage of the Roman ruling class
“divide and rule”, summarizes the function of hierarchy. Cleverly used by the bourgeoisie, it has
been perfected as a weapon by the Marxist-Leninist society based on sado-masochistic
relationships which are necessary prerequisites for political, economic and personal
enslavements.

13
James K. Jackson, “U.S. Direct Investment Abroad: Trends and Current Issues”, Congressional Research Service
Report for Congress(2005)
14
Samir Amin, “Imperialism and Globalization”,53(2) San Jose Monthly Review, P. 6(2001)
Being rigid hierarchy, Marxist-Leninist society is definitely a class society: “Deprived of
political, civil and union rights, forced into ‘unions’ that are mere appendages of the State, the
Party, and the K.G.B, subject to a regime of internal passports and work papers under permanent
police control and surveillance in the workplace and outside it: constantly harassed by
omnipresent official propaganda, the Russian working class is subjected to totalitarian
oppression and control, mental and physical expropriation that very clearly outdoes fascist and
Nazi models and has not been surpassed anywhere expect Maoist China.15” Thus, Marxist-
Leninist society is but an extension of the bourgeoisie into irs infra-red form. This bourgeoisie,
despite the fact that it does not own the means of production, rips off the surplus value. It is in its
interest to preserve, by all means, the capitalist mode of production and to save capitalism. This
is true not only within socialist countries but in western capitalism too. In the uprising in France
as well as in Czechoslovakia who “favored and produced the return to normality in the factories
and in the streets? Well, in both cases the communists: in Paris thanks to the unions, in Prague
thanks to the Red Army.” In Italy, in the Hot Autumn of 1969-70, when capitalism was seriously
challenged by the workers, the communist party stood up for the State and the status quo.
Marxist-Leninism is the state’s stage of monopoly capitalism. Monopoly capitalism, the Leninist
will argue, “has grown out of colonial policy.” Yet, paradoxically as it may sound, state
socialism has grown out of colonial policy. In the first place, the party is the colonizer of the
workers – the colonies; in the second the biggest state absorbs and economically exploits the
small ones, e.g. Russia and its Satellites. The order is colonial too: the summit, the center, the
bureaucracy are essential structural features to which the subalterns are workers, peasants and
provinces, The socialist monopoly can be represented as an octopus whose head is in Moscow,
or for that matter in Peking, while its tentacles are in the factories, in the fields, in the provinces,
in the small states sapping the energy of the workers and peoples and suffocating any attempts at
self-determination, self-assertion and independence. This makes the Marxist-Leninist State the
zenith of monopoly capitalism, because the unity of economic exploitation and political
enslavement is achieved. The words Lenin uttered against monopoly capitalism: “striving for
domination instead of striving for liberty”, are a proper description of socialist capitalism. Once
monopoly capitalism and the state merge into state monopoly capitalism, capitalism becomes
more virulent, aggressive and expansionary and reaches the final stage, imperialism, which is

15
E. K. Hunt and Howard J. Sherman, Economics: An Introduction to Traditional and Radical Views, 4th ed. (1993)
“the exploitation of small nations but a handful of the richest and most powerful nations.16” What
an ironical indictment of Lenin is the state Lenin has created.
5.CONCLUSION
In the modern realpolitik, if Marxist-Leninist Statist monopoly capitalism is a perfection over its
bourgeois counterpart then, it follows, Leninist imperialism is a rather more perfect and atrocious
form of oppression and exploitation. It is not accidental that the multi-nationals find it profitable
to pump millions of dollars into socialist economic system to ensure its blood circulation. State
socialist economies are reliable and pay secure dividends. In conclusion, it may be stated that
Marxism-Leninism, far from being a revolutionary science, is a reaction against revolution and
especially against the Social Revolution, leveler of all class distinctions and privileges.
Monopoly capitalism, the Leninist will argue, “has grown out of colonial policy.13” Yet,
paradoxically as it may sound, state socialism has grown out of colonial policy. In the first place,
the party is the colonizer of the workers – the colonies; in the second the biggest state absorbs
and economically exploits the small ones, e.g. Russia and its Satellites. The order is colonial too:
the summit, the center, the bureaucracy are essential structural features to which the subalterns
are workers, peasants and provinces. If Marxist-Leninist Statist monopoly capitalism is a
perfection over its bourgeois counterpart then, it follows, Leninist imperialism is a rather more
perfect and atrocious form of oppression and exploitation. It is not accidental that the multi-
nationals find it profitable to pump millions of dollars into socialist economic system to ensure
its blood circulation. State socialist economies are reliable and pay secure dividends.
The success of Marxism lies in its ability to create illusions in the heads of its followers, which
affirm rather than refute its bourgeois essence as a movement. Marxism-Leninism does not make
the world safe for socialism but it definitely makes it safe for capitalism. Not only is Marxism-
Leninism a vehicle of capitalism, it is the savior of capitalism, it is capitalism par excellence. It
does not engender revolution, it sprinkles rose oil for smooth capitalist exploitation.

16
Ibid, P. 3
 6.BIBLIOGRAPHY

BOOKS

 E. K. Hunt and Howard J. Sherman, Economics: An Introduction to Traditional and

Radical Views, 4th ed. (1993)
 Georg Lucacs, History of Class Consciousness, London, 1971. P.26
 Rapporto Veridico, Censor, Milano, Italy, 1975. P. 51
 V.I. Lenin, Imperialism, The Highest Stage of Capitalism, Pekin, 1970. P. 10
 Karl Marx and Frederick Engels, Manifesto of the Communist Party, London 1948, p. 61

JOURNALS
 Conrelius Castoriadis, The Social Regime in Russia, in Telos 38, 1978-79, Washington
University, St Lois. U.S.A. p.32
 Fred Mosheley, Lenin’s Economic Theory: True or False? A Central Idea, 30(1)
Valperaiso Social Journal, P. 132
 James K. Jackson, “U.S. Direct Investment Abroad: Trends and Current Issues”,
Congressional Research Service Report for Congress(2005)
 Samir Amin, “Imperialism and Globalization”,53(2) San Jose Monthly Review, P.
6(2001)
 Ahmed Bin Taheri, “Refurbishing the Proof of Lenin’s Construct: A Meta Political
Analysis”, 12(2) PMIMER Journal(2007)
 Sitaram Yechury, “How Marx Changed Surplus to Superb?”, 15(4) The Marxist, 2000
 Enrique Dussel , “The Four Drafts of Capital: Towards a New Interpretation of the
Dialectical Thought of Marx. Rethinking Marxism”, 15 Journal of Dialectics and
Politics(2001)