Adam Smith, a Scotsman, and Karl Marx, a German, are probably the two best known political economists in the Conceptual West. They lived a few decades apart and each had profound impact on how countries and people ran their economies and politics. They both had something to say about mercantilism which Smith, in his book, Wealth of Nations, castigated as being wasteful rather than being wealth creating. To Marx, mercantilism simply prepared the way for exploitative capitalism to replace feudalism by way of the merchant class. In his pamphlet, Communist Manifesto and later The Capital, Marx called for the proletariats in the most advanced industrial states to overthrow capitalism and establish communism. It did not happen. Instead, there was a revolution in backward Russia in 1917 that established a ‘communist’ state. The Russian example was imitated in China whose communist party grabbed power in 1949. While Russian communism collapsed at the end of the Cold War, China grew so much that it rivals the United States in economic performance.
Neither Smith nor Marx is doing well as an ideological pace setter. Smith’s free market belief disappeared under the weight of growing nativism and tariffs in both Britain and the United States, the acknowledged leaders of the capitalist system. The record in the United States is one of extreme gyrations between the politics of high and low tariffs. At present, it is on the high tariff swing with US President Donald Trump expressing his admiration for another high tariff US president, William McKinley. Trump has little interest in Smith’s prescription on how to create national wealth or Andrew Jackson’s desire to spread ‘democracy’. Instead, Trump is in the camp of such neo-mercantilists as Peter Thiel and his idea of diluting democracy and concentrating wealth and power in the hands of a few techno-authoritarians. Thus, the world’s leading capitalist country, has seemingly ditched Smith and capitalism.
Marx is also in trouble where he used to be popular, as in Russia and China. Russia was to communism what capitalism was to the United States. Given that Marxian communism never actually took place anywhere, the retreat from Marxism and its communist derivative is vivid. In Russia, it was Vladimir Lenin who made it so by violating the Marxian prescription for communist revolutions to happen only in the most advanced capitalist states. Blaming ‘imperialism’ for the failure to have revolutions in industrialised countries, Lenin imposed a ‘dictatorship of the proletariats’ on the Russians, from his commanding heights. Upon Lenin’s death in 1924, Joseph Stalin mounted rapid industrialisation in order to create many proletariats after which he became dictator of the proletariats. The end of the Cold War ended Russian communist romanticism and even the adoration of Marx. Subsequently, Russia’s leading ideologue, Alexander Dugin, whose beard resembles that of Marx, wrote that ‘the German Jew Karl Marx built a theory of Communism … on an inverted materialist version of Hegelianism.’
With Russia out, ‘communism’ remained in China but the communism that remained was far from what Marx had envisioned. Instead, China talks of ‘Socialism with Chinese Characteristics’ which was a euphemism for embracing capitalism similar to Kenya’s 1965 Sessional Paper Number 10 on ‘African Socialism’ which had nothing to do with either Socialism or African. China evolved ‘hybrid’ capitalism and ‘hybrid’ communism to guide its political economy in which its politics remained communist but its economy was allowed to be capitalistic. The architect of this hybrid was reformist Deng Xiaoping who in 1989 at Tiananmen Square made the distinction between economics which could follow Smith and politics as the preserve of the Communist Party of China. The same logic is evident in Xi Jinping’s way of running China.
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Both Smith and Marx still have relevance. Their importance, however, has declined because their staunch followers have ditched them. Followers have instead adopted ‘hybrid’ systems, of both Smith and Marx.
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Adam Smith, a Scotsman, and Karl Marx, a German, are probably the two best known political economists in the Conceptual West. They lived a few decades apart and each had profound impact on how countries and people ran their economies and politics. They both had something to say about mercantilism which Smith, in his book, Wealth of Nations, castigated as being wasteful rather than being wealth creating. To Marx, mercantilism simply prepared the way for exploitative capitalism to replace feudalism by way of the merchant class. In his pamphlet, Communist Manifesto and later The Capital, Marx called for the proletariats in the most advanced industrial states to overthrow capitalism and establish communism. It did not happen. Instead, there was a revolution in backward Russia in 1917 that established a ‘communist’ state. The Russian example was imitated in China whose communist party grabbed power in 1949. While Russian communism collapsed at the end of the Cold War, China grew so much that it rivals the United States in economic performance.
Neither Smith nor Marx is doing well as an ideological pace setter. Smith’s free market belief disappeared under the weight of growing nativism and tariffs in both Britain and the United States, the acknowledged leaders of the capitalist system. The record in the United States is one of extreme gyrations between the politics of high and low tariffs. At present, it is on the high tariff swing with US President Donald Trump expressing his admiration for another high tariff US president, William McKinley. Trump has little interest in Smith’s prescription on how to create national wealth or Andrew Jackson’s desire to spread ‘democracy’. Instead, Trump is in the camp of such neo-mercantilists as Peter Thiel and his idea of diluting democracy and concentrating wealth and power in the hands of a few techno-authoritarians. Thus, the world’s leading capitalist country, has seemingly ditched Smith and capitalism.
Marx is also in trouble where he used to be popular, as in Russia and China. Russia was to communism what capitalism was to the United States. Given that Marxian communism never actually took place anywhere, the retreat from Marxism and its communist derivative is vivid. In Russia, it was Vladimir Lenin who made it so by violating the Marxian prescription for communist revolutions to happen only in the most advanced capitalist states. Blaming ‘imperialism’ for the failure to have revolutions in industrialised countries, Lenin imposed a ‘dictatorship of the proletariats’ on the Russians, from his commanding heights. Upon Lenin’s death in 1924, Joseph Stalin mounted rapid industrialisation in order to create many proletariats after which he became dictator of the proletariats. The end of the Cold War ended Russian communist romanticism and even the adoration of Marx. Subsequently, Russia’s leading ideologue, Alexander Dugin, whose beard resembles that of Marx, wrote that ‘the German Jew Karl Marx built a theory of Communism … on an inverted materialist version of Hegelianism.’
With Russia out, ‘communism’ remained in China but the communism that remained was far from what Marx had envisioned. Instead, China talks of ‘Socialism with Chinese Characteristics’ which was a euphemism for embracing capitalism similar to Kenya’s 1965 Sessional Paper Number 10 on ‘African Socialism’ which had nothing to do with either Socialism or African. China evolved ‘hybrid’ capitalism and ‘hybrid’ communism to guide its political economy in which its politics remained communist but its economy was allowed to be capitalistic. The architect of this hybrid was reformist Deng Xiaoping who in 1989 at Tiananmen Square made the distinction between economics which could follow Smith and politics as the preserve of the Communist Party of China. The same logic is evident in Xi Jinping’s way of running China.
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Both Smith and Marx still have relevance. Their importance, however, has declined because their staunch followers have ditched them. Followers have instead adopted ‘hybrid’ systems, of both Smith and Marx.
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channel
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By Macharia Munene