| The Philosophy and Politics of Freedom Raya Dunayevskaya, The Power of Negativity: Selected Writings on the Dialectic in Hegel and Marx, edited by Peter Hudis and Kevin B. Anderson (Lanham, Maryland: Lexington Books, 2002), 386 pages, $100.00 cloth; $24.95 paper. August H. Nimtz, Jr., Marx and Engels: Their Contribution to the Democratic Breakthrough (Albany, New York: State University of New York Press, 2000), 377 pages, $71.50 cloth; $24.95 paper. John Rees, The Algebra of Revolution: The Dialectic and the Classical Marxist Tradition (London and New York: Routledge, 1998), 314 pages, $85.00 cloth; $26.95 paper. In these terrible times, to believe in the possibility of helping to make the world a better place, and to commit ones life to that, makes one a revolutionary. Over the years, some of us have been inclined to embrace Karl Marx because he was on our side—the side of labor, of the oppressed, of the working-class majority—and provided invaluable intellectual tools for understanding and changing reality. Others, in this dangerous time of intensifying capitalist “globalization,” are also reaching out to what Marx has to offer. With his comrade Frederick Engels he produced enough material to fill the numerous volumes of their Collected Works of which the final volume is due in 2003. A number of helpful books are now appearing that contribute to the collective process of understanding and utilizing this legacy for changing the world. Those who can offer some of the most fruitful insights will be those who, following the example of Marx and Engels, have committed themselves politically in their own lives. Which brings us to the works under review. A Philosophy of Freedom Raya Dunayevskaya’s three major books—Marxism and Freedom; Philosophy and Revolution; and Rosa Luxemburg, Women’s Liberation, and Marx’s Philosophy of Revolution—have now been capped by a splendid fourth volume, The Power of Negativity: Selected Writings on the Dialectic in Hegel and Marx, lovingly and carefully edited by two capable followers. This will be a rich and challenging resource for anyone who cares about any of the topics enumerated in the titles of these works. John Rees extends the study of the Marxist philosophical approach in The Algebra of Revolution: The Dialectic and the Classical Marxist Tradition, providing an admirably clear, stimulating, and well-documented discussion of Marx and Engels, Rosa Luxemburg, Vladimir Ilyich Lenin, Leon Trotsky, Antonio Gramsci, and Georg Lukacs, not to mention Eduard Bernstein, Karl Kautsky, George Plekhanov, Antonio Labriola, and others. August Nimtz, Jr.’s Marx and Engels: Their Contribution to the Democratic Breakthrough is itself an academic breakthrough. He defines the book’s themes as arguing that Marx and Engels “were the leading protagonists in the democratic movement in the nineteenth century,” that “they were first and foremost political activists, and not simply ‘thinkers,’” and that their practical political experience was central to shaping their theories. Dunayevskaya was politically engaged from the 1920s as a teenager in the early Communist movement until she died in 1987, after leading her own Marxist-Humanist group for more than three decades. Rees, a younger leader of Britain’s Socialist Workers Party, is the capable editor of the group’s theoretical organ, International Socialist Journal. An association with the very different Socialist Workers Party of the United States is suggested in the footnotes of Nimtz’s volume; an African-American scholar who has previously published Islam and Politics in East Africa, he is the only one of the three who is an academic—a professor of political science at the University of Minnesota—but the insights in his book indicate a familiarity with on-the-ground politics consistent with the experience of Marx and Engels. One might insist that the political groups mentioned here are mutually incompatible. But the strengths of each book transcend the boundaries of small groups. With a handful of others (including Herbert Marcuse, with whom she corresponded), Dunayevskaya was a pioneer in tracing connections between Marx and German philosopher G. W. F. Hegel (1770–1831). Powerfully influenced by what E. J. Hobsbawm has termed the dual revolution—the tidal waves of democratic and industrial revolutions that gathered force in the late eighteenth century—Hegel developed a way of comprehending reality, a method of analysis, hailed by the Russian revolutionary Alexander Herzen as “the algebra of revolution.” Known as dialectics, this philosophical orientation profoundly affected Karl Marx and Frederick Engels, and was developed as an essential component of the revolutionary Marxist tradition. It has often been shrugged off—with a grimace or a laugh—as impossibly dense. Dunayevskaya will have none of that. Terming Marx’s Economic and Philosophical Manuscripts of 1844 (which she was the first to publish in English) as “founding a new continent of thought and of revolution,” she insists that the young Marx “articulates the great merit of Hegel in discovering the ‘negation of the negation,’ and the great demerit of Hegel in enveloping it in such mysticism by dealing with it as various stages of consciousness, rather than as men and women thinking.” Her meaning emerges in such Hegelian-Marxist passages as these: What [French philosopher Maurice Merleau-Ponty] is trying to do here is to sum up Marx’s conception of the dialectic as TOTALITY....The human factor is the decisive factor and if that is so it is the total human being, not any single portion of him. And because this is so, and because all history is the history of the class struggles for freedom, Hegel’s “Absolute Idea” was in actuality TOTAL FREEDOM. That is how Hegel and Marx met, so to speak, and why Hegel’s abstract ideas are in actuality the reflections of this historic movement... To some extent, the limitations of the three books are offset by the strengths of each. That is, they disagree with each other. Nimtz tells us that Marx and Engels carried out an “irreparable break...with philosophy in general and German philosophy in particular,” and were especially intent on “clearing away the Hegelian cobwebs” of their student days. Such assertions become untenable in the face of Dunayevskaya’s impressive labors, not to mention Rees’s survey. Of course, the focus of each book is different. Nimtz restricts himself to Marx and Engels, but for Dunayevskaya this is one person too many—she creates a wall to protect Hegel and Marx from what she dismisses as “post-Marx Marxists, beginning with Engels.” Rees doesn’t accept this, insisting that a fundamental methodological continuity places Marx with Engels, Luxemburg, Lenin, Lukacs, Trotsky, and Gramsci all within the same revolutionary camp. Rees complains that Dunayevskaya and her one-time co-thinker C. L. R. James “map the categories of Hegel’s philosophy directly onto the history of capitalism in an unmediated and abstract manner.” And, in fact, there is a remarkably abstract quality to Dunayevskaya’s discussion of practical politics, including questions of strategy, tactics, and organization. And it is precisely here that Nimtz’s strengths come through. Revolutionary Practice Nimtz honors Hal Draper’s “insufficiently heralded work on Marx and Engels.” Draper’s four fat volumes, Karl Marx’s Theory of Revolution (Monthly Review Press) plus his three-volume Marx-Engels glossary, register, and chronicle, as well as Richard N. Hunt’s two-volume Political Ideas of Marx and Engels, broke much of the ground that Nimtz covers. But here, in a single volume of 300 clearly written and well-documented pages, we get not only a survey of much previous scholarship but, more important, a survey of the writings (including the correspondence) and the political activities of the two revolutionaries. An initial chapter on the context and beginnings of Marx’s and Engels’ revolutionary partnership is followed by three chapters on their involvement with the Communist League and the revolutionary upsurge of 1848–1849. Next comes a fine chapter comparing the thought and political activity of Marx with that of liberalism’s intellectual hero Alexis de Tocqueville. Another chapter shows that the long “lull” in the class struggle, stretching from 1850 to 1861 was one in which Marx and Engels remained engaged in practical and organizational work—which formed an important prelude to their involvement in the International Working Men’s Association (the First International of 1864–1876), to which Nimtz devotes three more chapters. The final chapter focuses on Engels’ political work in the years between Marx’s death and his own. One could use this as a guidebook for the fifty-volume Collected Works, and also as a political biography worth setting beside David Riazanov’s classic Karl Marx and Friedrich Engels. More than this, it offers a challenge for those drawn to the spirit of Marx’s famous eleventh thesis on Feuerbach—that the point for revolutionaries is not simply to understand the world but to change it. Nimtz is not content merely to reproduce the ideas of his two subjects. He interacts with them and offers interesting ideas and interpretations. There is a refreshing rejection of Lenin-bashing as he emphasizes an elemental and multifaceted continuity between Marx, Engels, and the Russian revolutionary. He also points out that the young Engels was inspired by the Seminole Indians’ resistance to “White European encroachment” in 1830s Florida, commenting that both Engels and Marx were confident in “the ability of the oppressed to overcome their oppression.” There is also the importance of the peasantry and the centrality of the worker-peasant alliance that he is able to trace in the thought of Marx and Engels. More than this, the relationship between capitalism and democracy, according to Nimtz, is illuminated by the fact that “the ‘self-organization of the working class’ in the second half of the nineteenth century was responsible for the democratic breakthrough, that is, the institution of ‘universal suffrage,’ and the acquisition of civil liberties.” In this he cites the important 1992 study Capitalist Development and Democracy by Dietrich Rueschmeyer, Evelyne Stephens, and John Stephens (though equally relevant is Geoff Eley’s just-published Forging Democracy: The History of the Left in Europe, 1850–2000). Essential in the thrust of working-class democracy, Nimtz documents, were the intellectual and practical-political labors of Marx and Engels in the Communist League, in the 1848 upsurge, during the quiescent interlude that followed, and then in the years of the First International and the Paris Commune. The serious-minded political work (not just theorizing) of Marx and Engels for twenty years before the First International’s founding in 1864, we are shown, was essential in enabling them to play a central role in its development. And Nimtz is especially good in conveying a sense of the crucial importance of the First International in the larger political developments of the 1860s and 1870s, and particularly in the development of the labor movements of Europe and North America. Yet the book also provides some less positive surprises. There is an odd and recurring fuzziness around the basic Marxist concept of class. The term working class is defined as “employed manual labor outside of agriculture.” This dramatically narrows what one finds in the Communist Manifesto and Capital: the working class consists of those making their living through the sale of their ability to labor. Nimtz also uses the term “middle class” quite loosely—sometimes seemingly to imply that it is similar to “petty bourgeois” or perhaps to “non-manual” employees. In the Europe of Marx and Engels, however, the term referred to the bourgeoisie, the capitalist class (the upper class being the landowning aristocracy). Even worse is his bungling of the concept dictatorship of the proletariat, which (Draper and others have shown) Marx and Engels saw as political rule by the working class. Nimtz disagrees, insisting that a workers state cannot coexist with a capitalist economy. Nimtz uncharacteristically criticizes Engels for asserting that Paris Commune of 1871 (which did not have time to eliminate capitalism) was an example of the dictatorship of the proletariat (workers’ rule). “Engels may well have overstated the case of the Commune to score points,” Nimtz insists, adding “it seems reasonable to conclude” that Marx would have preferred to view the Paris Commune as “the dictatorship of the people’s alliance, that is, an alliance of the proletariat and its allies....” One can only assume that Nimtz would also reject the standard interpretation offered by Lenin in 1919: “‘Soviet power’ is the second historical step, or stage, in the development of the proletarian dictatorship. The first step was the Paris Commune. The brilliant analysis of its nature and the significance given by Marx in his The Civil War in France showed that the Commune has created a new type of state, a proletarian state.” Contrary to Nimtz’s convolutions, it would seem that Lenin and Engels were accurately representing the views of Marx that, quite simply, a workers’ state must first comes to power in order to initiate the process of eliminating capitalism. Fortunately, such theoretical tangles do not intrude into most of this study. Somewhat more intrusive is the way Nimtz discusses the organizational question—he makes reference to the “the Marx-Engels team” and “the Marx party” so frequently, and in such varied contexts, that confusion is inevitable—especially since “the Marx-Engels team” appears to be simply another way of saying “Marx and Engels,” and what is meant by party is more often than not referring “to a political tendency and not an organized current” (and can include sometimes just Marx and Engels, sometimes those who agree with the basic ideas of the Manifesto, sometimes old friends from the stormy days of 1848, sometimes those who agree with Marx and Engels inside the First International). But as Marx’s biographer Franz Mehring put it, “their supporters, as Marx himself admitted, did not represent a party.” Nimtz prefers a different way of putting it—that, more often than not, “the party was still not convinced that circumstances required an organized formation.” The point that Nimtz is making here, however, seems entirely valid. Marx’s detractors and even some of his partisans generally miss a key aspect of what he was doing. To the extent that they look at his practical political activity at all—especially his conflicts with others inside the labor and socialist movements—they tend to see a tactless, impatient, and argumentative ego, somehow lining up and manipulating various pals, more often than not hurling polemics and mobilizing cliques that were “full of sound and fury, signifying nothing.” What Nimtz is able to highlight is a much more consistent, coherent, principled mode of operation on the part of a numerically fluctuating current of co-thinkers. It has political meaning. There is a correspondence between analysis, strategy, and tactics. What Marx and Engels and their various comrades hoped to accomplish was related to how they functioned—even without an organization—and they were able to have a profound impact in the broader organizations and movements of which they were part. All of this contributed to the later crystallization of socialist workers parties in a number of countries. More work needs to be done to understand all of this more clearly, but Nimtz is pointing us in the right direction. The Dialectics of Struggle In The Algebra of Revolution, John Rees highlights the philosopher Hegel’s immense intellectual labors, which combined a deep commitment to human freedom with a profoundly historical sensibility embracing the notion that reality unfolds and moves forward through the interaction of contradictory tendencies. Each of these tendencies contain elements of “truth” that can only be understood adequately as part of a complex, multifaceted, always-evolving totality. Hegel developed concepts and categories to help comprehend the almost impossibly complex, dynamic, contradictory reality in which all of us are enmeshed. Rees, like Dunayevskaya before him, demonstrates that this dialectical outlook and method were absorbed into the very being of Marx, to be transformed by him but never abandoned. All too many in the Marxist tradition have shrugged off or quietly set aside or (worse) dogmatized this approach, resulting in a deterministic Marxism: history and economics become the powerful “objective factors” which inevitably move forward, regardless of what people think and try to do (which are the secondary and subordinate “subjective factors”). Such seemingly hardheaded, “scientific” fatalism has all-too-often passed for profound Marxist wisdom. This can cause working-class militants to passively wait for revolutionary inevitabilities, which, as the history of the twentieth century demonstrates, never materialize. In contrast, Marx and Engels saw objective and subjective factors as an interacting unity of opposites, with the working class itself (thanks to the role in the labor process and the quality of human consciousness) combining the subjective and objective. “Once this notion, the unity of subject and object, has vanished...the working class is no longer seen as the identical subject-object of history,” Rees argues. “That is, it is no longer seen as a class whose struggle transforms it from being an exploited class lacking in socialist consciousness and unable to control the society that it produces into a class capable of consciously fighting to banish exploitation and able to run society according it its own needs.” What Hegel taught was what Marx and Engels intensified—human freedom is possible and necessary, what people do and fail to do makes a difference, the working-class majority can become conscious of its situation and determine its own future. This activist outlook, as the work of Nimtz has so effectively shown, is central to the actual lives and political efforts of Marx and Engels. Rees goes on to show us that it is precisely this dialectical-activist element that is built into the mass strike conceptions of Rosa Luxemburg, the theory of permanent revolution of Leon Trotsky, and the understanding of the party/mass struggle dialectic of Lenin, which was further elaborated by the Hegelian Leninists, Antonio Gramsci and Georg Lukacs, through their own intense revolutionary experience in Italy and Hungary. The longest chapter in this volume is that dealing with Lukacs, a splendid exploration consistent with Lukacs’ recently discovered and published masterpiece of 1926 (for which Rees has written a fine introduction), Tailism and the Dialectic. Rees’s book helps to demystify something about which much complicated (and also simplistic) nonsense has been propagated. While making a passing reference to “the characteristic Hegelian triad of thesis, antithesis, and synthesis,” he is scornful of the idea that the Hegelian dialectic can be reduced to this “eternal trichotomy,” approvingly quoting Plekhanov that “it does not at all play in Hegel’s work the part which is attributed to it by people who have not the least idea of the philosophy of that thinker.” Rees is more inclined to accept, as “useful reminders of forms in which dialectical contradictions sometimes work themselves out,” the three “laws” identified by Engels: unity of opposites; transformation of quantity into quality; and negation of the negation. The unity of opposites involves the dynamic linkage between interpenetrating yet contradictory elements—for example, the relationship between workers and capitalists as essential components of the capitalist system. The transformation of quantity into quality involves the process by which gradual “numerical” alternations can result in qualitative change—water turning from a liquid into a solid or gas depending on the rise or fall of the temperature, or an escalating number of workers and workplaces being involved in a strike changing a situation from an economic dispute to a politically-charged general strike to a social revolution. The negation of the negation involves the development of some aspect of reality in which its original state is overcome or transcended (negation), but rather than being simply obliterated, the elements of the original aspect of reality are preserved (negation of the negation) in the process of transformation. For example, a liberal’s fundamental belief in human rights and freedom of expression might be preserved in his or her later rejection of liberalism for socialism. However, Rees emphasizes, these three “laws” are “not the only way that dialectical development can take place,” and by no means do they constitute some “supra-historical master key.” He clearly prefers a different way of explaining the dialectical method, emphasizing “three principles: totality, change, and contradiction. Taken separately these principles do not constitute a dialectical approach. Only when they are taken together do they become dialectical.” He adds that “the parts and the whole are not reducible to each other. The parts and the whole mutually condition, or mediate, each other.” Rees emphasizes that Marx’s materialist conception of history is grounded in this analytical approach: “Society is taken to be in a process of constant change. Such change involves the totality of relations—economic, political, ideological, and cultural—of which the society is composed. This process of total change is a result of internal contradictions, manifested as class antagonism, which reconstitute society anew by both transforming and renewing the forces that first gave rise to the initial contradiction.” At the same time, Rees explains, the dialectical method in Marx’s hands does not consist of “a progression of self-generating categories,” but instead that he continually refined and revised his dialectical analysis through “constant empirical verification,” understanding that “real contradictions are...more diverse and complex, and change more rapidly, than the concepts that express them, even when these are dialectical concepts especially designed to capture complexity and change. Constant empirical work is therefore essential to renew both the concrete analyses and the dialectical concepts that are generalized from these analyses.” Lenin described this as Marx’s method in Capital: “Testing by facts or by practice...is to be found in each step of the analysis.” Rees concludes his study with the obvious but essential notion that the Marxist dialectic revolves around “an appreciation of the revolutionary potential of the working class,” and that any effort to renew Marxist philosophy is actually inseparable from the task of overcoming late-twentieth-century defeats of the working class through rebuilding the working-class movement. He adds that “a revolutionary organization remains the indispensable tool for overcoming the unevenness in working-class consciousness, maximizing the effectiveness of working-class struggle, recalling the lessons of past victories and defeats, and educating and leading workers in struggle.” We are faced with the urgent question, however, of how these truths can be understood and applied in the unique historical circumstances at the dawn of our new century. Any mechanistic effort to superimpose “orthodox” formulas from earlier historical contexts onto the new and fluid realities would be a violation of the dialectical method Rees so ably discusses in this fine book. A simplistic effort to proclaim a revolutionary working class party, even if done in the name of revolutionary dialectics, is guaranteed to be fruitless. Such things must evolve organically from the actual class struggles of the real world in which we live. The question is: how can that process be advanced by thoughtful activists? Armed with the theoretical tools surveyed in different but challenging ways in these books by John Rees, August Nimtz, and Raya Dunayevskaya—each designed for those committed to developing revolutionary analyses and strategies—activists of today and tomorrow, one can hope, will be better able to understand the world in order to change it. |
Mu
Sunday, January 2, 2011
Understanding the world in order to change it
Those who stubbornly maintain that they have no philosophy are mistaken. Nature abhors a vacuum.
Do We Need Philosophy?
Role of Religion
The Division of Labour
Materialism and Idealism
Do We Need Philosophy?
Before we start, you may be tempted to ask, "Well, what of it?" Is it really necessary for us to bother about complicated questions of science and philosophy? To such a question, two replies are possible. If what is meant is: do we need to know about such things in order to go about our daily life, then the answer is evidently no. But if we wish to gain a rational understanding of the world in which we live, and the fundamental processes at work in nature, society and our own way of thinking, then matters appear in quite a different light.
Strangely enough, everyone has a "philosophy." A philosophy is a way of looking at the world. We all believe we know how to distinguish right from wrong, good from bad. These are, however, very complicated issues which have occupied the attention of the greatest minds in history. When confronted with the terrible fact of the existence of events like the fratricidal war in the former Yugoslavia, the re-emergence of mass unemployment, the slaughter in Rwanda, many people will confess that they do not comprehend such things, and will frequently resort to vague references to "human nature." But what is this mysterious human nature which is seen as the source of all our ills and is alleged to be eternally unchangeable? This is a profoundly philosophical question, to which not many would venture a reply, unless they were of a religious cast of mind, in which case they would say that God, in His wisdom, made us like that. Why anyone should worship a Being that played such tricks on His creations is another matter.
Those who stubbornly maintain that they have no philosophy are mistaken. Nature abhors a vacuum. People who lack a coherently worked-out philosophical standpoint will inevitably reflect the ideas and prejudices of the society and the milieu in which they live. That means, in the given context, that their heads will be full of the ideas they imbibe from the newspapers, television, pulpit and schoolroom, which faithfully reflect the interests and morality of existing society.
Most people usually succeed in muddling through life, until some great upheaval compels them to re-consider the kind of ideas and values they grew up with. The crisis of society forces them to question many things they took for granted. At such times, ideas which seemed remote suddenly become strikingly relevant. Anyone who wishes to understand life, not as a meaningless series of accidents or an unthinking routine, must occupy themselves with philosophy, that is, with thought at a higher level than the immediate problems of everyday existence. Only by this means do we raise ourselves to a height where we begin to fulfil our potential as conscious human beings, willing and able to take control of our own destinies.
It is generally understood that anything worth while in life requires some effort. The study of philosophy, by its very nature, involves certain difficulties, because it deals with matters far removed from the world of ordinary experience. Even the terminology used presents difficulties because words are used in a way that does not necessarily correspond to the common usage. But the same is true for any specialised subject, from psychoanalysis to engineering.
The second obstacle is more serious. In the last century, when Marx and Engels first published their writings on dialectical materialism, they could assume that many of their readers had at least a working knowledge of classical philosophy, including Hegel. Nowadays it is not possible to make such an assumption. Philosophy no longer occupies the place it had before, since the role of speculation about the nature of the universe and life has long since been occupied by the sciences. The possession of powerful radio telescopes and spacecraft renders guesses about the nature and extent of our solar system unnecessary. Even the mysteries of the human soul are being gradually laid bare by the progress of neurobiology and psychology.
The situation is far less satisfactory in the realm of the social sciences, mainly because the desire for accurate knowledge often decreases to the degree that science impinges on the powerful material interests which govern the lives of people. The great advances made by Marx and Engels in the sphere of social and historical analysis and economics fall outside the scope of the present work. Suffice it to point out that, despite the sustained and frequently malicious attacks to which they were subjected from the beginning, the theories of Marxism in the social sphere have been the decisive factor in the development of modern social sciences. As for their vitality, this is testified to by the fact that the attacks not only continue, but tend to increase in intensity as time goes by.
In past ages, the development of science, which has always been closely linked to that of the productive forces, had not reached a sufficiently high level to permit men and women to understand the world in which they lived. In the absence of scientific knowledge, or the material means of obtaining it, they were compelled to rely upon the one instrument they possessed that could help them to make sense of the world, and thus gain power over it—the human mind. The struggle to understand the world was closely identified with humankind’s struggle to tear itself away from a merely animal level of existence, to gain mastery over the blind forces of nature, and to become free in the real, not legalistic, sense of the word. This struggle is a red thread running through the whole of human history.
"Man is quite insane. He wouldn’t know how to create a maggot, and he creates Gods by the dozen." (Montaigne.)
"All mythology overcomes and dominates and shapes the force of nature in the imagination and by the imagination; it therefore vanishes with the advent of real mastery over them." (Marx)
Animals have no religion, and in the past it was said that this constituted the main difference between humans and "brutes." But that is just another way of saying that only humans possess consciousness in the full sense of the word. In recent years, there has been a reaction against the idea of Man as a special and unique Creation. This is undoubtedly correct, in the sense that humans developed from animals, and, in many important respects, remain animals. Not only do we share many of the bodily functions with other animals, but the genetic difference between humans and chimpanzees is less than two percent. That is a crushing answer to the nonsense of the Creationists.
Recent research with bonobo chimpanzees has proven beyond doubt that the primates closest to humans are capable of a level of mental activity similar in some respects to that of a human child. That is striking proof of the kinship between humans and the highest primates, but here the analogy begins to break down. Despite all the efforts of experimenters, captive bonobos have not been able to speak or fashion a stone tool remotely similar to the simplest implements created by early hominids. The two percent genetic difference between humans and chimpanzees marks the qualitative leap from the animal to the human. This was accomplished, not by a Creator, but by the development of the brain through manual labour.
The skill to make even the simplest stone tools involves a very high level of mental ability and abstract thought. The ability to select the right sort of stone and reject others; the choice of the correct angle to strike a blow, and the use of precisely the right amount of force—these are highly complicated intellectual actions. They imply a degree of planning and foresight not found in even the most advanced primates. However, the use and manufacture of stone tools was not the result of conscious planning, but was something forced upon man’s remote ancestors by necessity. It was not consciousness that created humanity, but the necessary conditions of human existence which led to an enlarged brain, speech and culture, including religion.
The need to understand the world was closely linked to the need to survive. Those early hominids who discovered the use of stone scrapers in butchering dead animals with thick hides obtained a considerable advantage over those who were denied access to this rich supply of fats and proteins. Those who perfected their stone implements and worked out where to find the best materials stood a better chance of survival than those who did not. With the development of technique came the expansion of the mind, and the need to explain the phenomena of nature which governed their lives. Over millions of years, through trial and error, our ancestors began to establish certain relations between things. They began to make abstractions, that is, to generalise from experience and practice.
For centuries, the central question of philosophy has been the relation of thinking to being. Most people live their lives quite happily without even considering this problem. They think and act, talk and work, with not the slightest difficulty. Moreover, it would not occur to them to regard as incompatible the two most basic human activities, which are in practice inseparably linked. Even the most elementary action, if we exclude simple biologically determined reactions, demands some thought. To a degree, this is true not only of humans but also of animals, such as a cat lying in wait for a mouse. In man, however, the kind of thought and planning has a qualitatively higher character than any of the mental activities of even the most advanced of the apes.
This fact is inseparably linked to the capacity for abstract thought, which enables humans to go far beyond the immediate situation given to us by our senses. We can envisage situations, not just in the past (animals also have memory, as a dog which cowers at the sight of a stick) but also the future. We can anticipate complex situations, plan and thereby determine the outcome, and to some extent determine our own destinies. Although we do not normally think about it, this represents a colossal conquest which sets humankind apart from the rest of nature. "What is distinctive of human reasoning," says Professor Gordon Childe, "is that it can go immensely farther from the actual present situation than any other animal’s reasoning ever seems to get it." (6) From this capacity springs all the manifold creations of civilisation, culture, art, music, literature, science, philosophy, religion. We also take for granted that all this does not drop from the skies, but is the product of millions of years of development.
The Greek philosopher Anaxagoras (500-428 B.C.), in a brilliant deduction, said that man’s mental development depended upon the freeing of the hands. In his important article, The Part Played by Labour in the Transition from Ape to Man, Engels showed the exact way in which this transition was achieved. He proved that the upright stance, freeing of the hands for labour, the form of the hands, with the opposition of the thumb to the fingers, which allowed for clutching, were the physiological preconditions for tool making, which, in turn, was the main stimulus to the development of the brain. Speech itself, which is inseparable from thought, arose out of the demands of social production, the need to realise complicated functions by means of co-operation. These theories of Engels have been strikingly confirmed by the most recent discoveries of palaeontology, which show that hominid apes appeared in Africa far earlier than previously thought, and that they had brains no bigger than those of a modern chimpanzee. That is to say, the development of the brain came after the production of tools, and as a result of it. Thus, it is not true that "In the beginning was the Word," but as the German poet Goethe proclaimed—"In the beginning was the Deed."
The ability to engage in abstract thought is inseparable from language. The celebrated prehistorian Gordon Childe observes: "Reasoning, and all that we call thinking, including the chimpanzee’s, must involve mental operations with what psychologists call images. A visual image, a mental picture of, say, a banana, is always liable to be a picture of a particular banana in a particular setting. A word on the contrary is, as explained, more general and abstract, having eliminated just those accidental features that give individuality to any real banana. Mental images of words (pictures of the sound or of the muscular movements entailed in uttering it) form very convenient counters for thinking with. Thinking with their aid necessarily possesses just that quality of abstractness and generality that animal thinking seems to lack. Men can think, as well as talk, about the class of objects called ‘bananas’; the chimpanzee never gets further than ‘that banana in that tube.’ In this way the social instrument termed language has contributed to what is grandiloquently described as ‘man’s emancipation from bondage to the concrete.’" (7)
Early humans, after a long period of time, formed the general idea of, say, a plant or an animal. This arose out of the concrete observation of many particular plants and animals. But when we arrive at the general concept "plant," we no longer see before us this or that flower or bush, but that which is common to all of them. We grasp the essence of a plant, its innermost being. Compared with this, the peculiar features of individual plants seem secondary and unstable. What is permanent and universal is contained in the general conception. We can never actually see a plant as such, as opposed to particular flowers and bushes. It is an abstraction of the mind. Yet it is a deeper and truer expression of what is essential to the plant’s nature when stripped of all secondary features.
However, the abstractions of early humans were far from having a scientific character. They were tentative explorations, like the impressions of a child—guesses and hypotheses, sometimes incorrect, but always bold and imaginative. To our remote ancestors, the sun was a great being that sometimes warmed them, and sometimes burnt them. The earth was a sleeping giant. Fire was a fierce animal that bit them when they touched it. Early humans experienced thunder and lightning. This must have frightened them, as it still frightens animals and people today. But, unlike animals, humans looked for a general explanation of the phenomenon. Given the lack of any scientific knowledge, the explanation was invariably a supernatural one—some god, hitting an anvil with his hammer. To our eyes, such explanations seem merely amusing, like the naïve explanations of children. Nevertheless, at this period they were extremely important hypotheses—an attempt to find a rational cause for the phenomenon, in which men distinguished between the immediate experience, and saw something entirely separate from it.
The most characteristic form of early religion is animism—the notion that everything, animate or inanimate, has a spirit. We see the same kind of reaction in a child when it smacks a table against which it has banged its head. In the same way, early humans, and certain tribes today, will ask the spirit of a tree to forgive them before cutting it down. Animism belongs to a period when humankind has not yet fully separated itself from the animal world and nature in general. The closeness of humans to the world of animals is attested to by the freshness and beauty of cave-art, where horses, deer and bison are depicted with a naturalness which can no longer be captured by the modern artist. It is the childhood of the human race, which has gone beyond recall. We can only imagine the psychology of these distant ancestors of ours. But by combining the discoveries of palaeontology with anthropology, it is possible to reconstruct, at least in outline, the world from which we have emerged.
In his classic anthropological study of the origins of magic and religion, Sir James Frazer writes:
"A savage hardly conceives the distinction commonly drawn by more advanced peoples between the natural and the supernatural. To him the world is to a great extent worked by supernatural agents, that is, by personal beings acting on impulses and motives like his own, liable like him to be moved by appeals to their pity, their hope, and their fears. In a world so conceived he sees no limit to this power of influencing the course of nature to his own advantage. Prayers, promises, or threats may secure him fine weather and an abundant crop from the gods; and if a god should happen, as he sometimes believes, to become incarnate in his own person, then he need appeal to no higher being; he, the savage, possesses in himself all the powers necessary to further his own well-being and that of his fellow-men." (8)
The notion that the soul exists separate and apart from the body comes down from the most remote period of savagery. The basis of it is quite clear. When we are asleep, the soul appears to leave the body and roam about in dreams. By extension, the similarity between death and sleep ("death’s second self," Shakespeare called it) suggested the idea that the soul could continue to exist after death. Early humans thus concluded that there is something inside them that is separate from their bodies. This is the soul, which commands the body, and can do all kinds of incredible things, even when the body is asleep. They also noticed how words of wisdom issued from the mouths of old people, and concluded that, whereas the body perishes, the soul lives on. To people used to the idea of migration, death was seen as the migration of the soul, which needed food and implements for the journey.
At first these spirits had no fixed abode. They merely wandered about, usually making trouble, which obliged the living to go to extraordinary lengths to appease them. Here we have the origin of religious ceremonies. Eventually, the idea arose that the assistance of these spirits could be enlisted by means of prayer. At this stage, religion (magic), art and science were not differentiated. Lacking the means to gain real power over their environment, early humans attempted to obtain their ends by means of magical intercourse with nature, and thus subject it to their will. The attitude of early humans to their spirit-gods and fetishes was quite practical. Prayers were intended to get results. A man would make an image with his own hands, and prostrate himself before it. But if the desired result was not forthcoming, he would curse it and beat it, in order to extract by violence what he failed to do by entreaty. In this strange world of dreams and ghosts, this world of religion, the primitive mind saw every happening as the work of unseen spirits. Every bush and stream was a living creature, friendly or hostile. Every chance event, every dream, pain or sensation, was caused by a spirit. Religious explanations filled the gap left by lack of knowledge of the laws of nature. Even death was not seen as a natural occurrence, but a result of some offence caused to the gods.
For the great majority of the existence of the human race, the minds of men and women have been full of this kind of thing. And not only in what people like to regard as primitive societies. The same kind of superstitious beliefs continue to exist in slightly different guises today. Beneath the thin veneer of civilisation lurk primitive irrational tendencies and ideas which have their roots in a remote past which has been half-forgotten, but is not yet overcome. Nor will they be finally rooted out of human consciousness until men and women establish firm control over their conditions of existence.
Frazer points out that the division between manual and mental labour in primitive society is invariably linked to the formation of a caste of priests, shamans or magicians:
"Social progress, as we know, consists mainly in a successive differentiation of functions, or, in simpler language, a division of labour. The work which in primitive society is done by all alike and by all equally ill, or nearly so, is gradually distributed among different classes of workers and executed more and more perfectly; and so far as the products, material or immaterial, of his specialised labour are shared by all, the whole community benefits by the increasing specialisation. Now magicians or medicine-men appear to constitute the oldest artificial or professional class in the evolution of society. For sorcerers are found in every savage tribe known to us; and among the lowest savages, such as the Australian aborigines, they are the only professional class that exists." (9)
The dualism which separates soul from body, mind from matter, thinking from doing, received a powerful impulse from the development of the division of labour at a given stage of social evolution. The separation between mental and manual labour is a phenomenon which coincides with the division of society into classes. It marked a great advance in human development. For the first time, a minority of society was freed from the necessity to work to obtain the essentials of existence. The possession of that most precious commodity, leisure, meant that men could devote their lives to the study of the stars. As the German materialist philosopher Ludwig Feuerbach explains, real theoretical science begins with cosmology:
"The animal is sensible only of the beam which immediately affects life; while man perceives the ray, to him physically indifferent, of the remotest star. Man alone has purely intellectual, disinterested joys and passions; the eye of man alone keeps theoretic festivals. The eye which looks into the starry heavens, which gazes at that light, alike useless and harmless, having nothing in common with the earth and its necessities—this eye sees in that light its own nature, its own origin. The eye is heavenly in its nature. Hence man elevates himself above the earth only with the eye; hence theory begins with the contemplation of the heavens. The first philosophers were astronomers." (10)
Although at this early stage this was still mixed up with religion, and the requirements and interests of a priest caste, it also signified the birth of human civilisation. This was already understood by Aristotle, who wrote:
"These theoretical arts, moreover, were evolved in places where men had plenty of free time: mathematics, for example, originated in Egypt, where a priestly caste enjoyed the necessary leisure." (11)
Knowledge is a source of power. In any society in which art, science and government is the monopoly of a few, that minority will use and abuse its power in its own interests. The annual flooding of the Nile was a matter of life and death to the people of Egypt, whose crops depended on it. The ability of the priests in Egypt to predict, on the basis of astronomical observations, when the Nile would flood its banks must have greatly increased their prestige and power over society. The art of writing, a most powerful invention, was the jealously guarded secret of the priest-caste. As Ilya Prigogine and Isabelle Stengers comment:
"Sumer discovered writing; the Sumerian priests speculated that the future might be written in some hidden way in the events taking place around us in the present. They even systematised this belief, mixing magical and rational elements." (12)
The further development of the division of labour gave rise to an unbridgeable gulf between the intellectual elite and the majority of humankind, condemned to labour with their hands. The intellectual, whether Babylonian priest or modern theoretical physicist, knows only one kind of labour, mental labour. Over the course of millennia, the superiority of the latter over "crude" manual labour becomes deeply ingrained and acquires the force of a prejudice. Language, words and thoughts become endowed with mystical powers. Culture becomes the monopoly of a privileged elite, which jealously guards its secrets, and uses and abuses its position in its own interests.
In ancient times, the intellectual aristocracy made no attempt to conceal its contempt for physical labour. The following extract from an Egyptian text known as The Satire on the Trades, written about 2000 B.C. is supposed to consist of a father’s exhortation to his son, whom he is sending to the Writing School to train as a scribe:
"I have seen how the belaboured man is belaboured—thou shouldst set thy heart in pursuit of writing. And I have observed how one may be rescued from his duties [sic!]—behold, there is nothing which surpasses writing…
"I have seen the metalworker at his work at the mouth of his furnace. His fingers were somewhat like crocodiles; he stank more than fish-roe…
"The small building contractor carries mud…He is dirtier than vines or pigs from treading under his mud. His clothes are stiff with clay…
"The arrow-maker, he is very miserable as he goes out into the desert [to get flint points]. Greater is that which he gives to his donkey than its work thereafter [is worth]…
"The laundry man launders on the [river] bank, a neighbour of the crocodile…
"Behold, there is no profession free of a boss—except for the scribe: he is the boss…
"Behold, there is no scribe who lacks food from the property of the House of the King—life, prosperity, health!…His father and his mother praise god, he being set upon the way of the living. Behold these things—I [have set them] before thee and thy children’s children." (13)
The same attitude was prevalent among the Greeks:
"What are called the mechanical arts," says Xenophon, "carry a social stigma and are rightly dishonoured in our cities, for these arts damage the bodies of those who work in them or who act as overseers, by compelling them to a sedentary life and to an indoor life, and, in some cases, to spend the whole day by the fire. This physical degeneration results also in deterioration of the soul. Furthermore, the workers at these trades simply have not got the time to perform the offices of friendship or citizenship. Consequently they are looked upon as bad friends and bad patriots, and in some cities, especially the warlike ones, it is not legal for a citizen to ply a mechanical trade." (14)
The radical divorce between mental and manual labour deepens the illusion that ideas, thoughts and words have an independent existence. This misconception lies at the heart of all religion and philosophical idealism.
It was not god who created man after his own image, but, on the contrary, men and women who created gods in their own image and likeness. Ludwig Feuerbach said that if birds had a religion, their God would have wings. "Religion is a dream, in which our own conceptions and emotions appear to us as separate existences, beings out of ourselves. The religious mind does not distinguish between subjective and objective—it has no doubts; it has the faculty, not of discerning other things than itself, but of seeing its own conceptions out of itself as distinct beings." (15) This was already understood by men like Xenophanes of Colophon (565-c.470 B.C.), who wrote "Homer and Hesiod have ascribed to the gods every deed that is shameful and dishonourable among men: stealing and adultery and deceiving each other…The Ethiopians make their gods black and snub-nosed, and the Thracians theirs grey-eyed and red-haired…If animals could paint and make things, like men, horses and oxen too would fashion the gods in their own image." (16)
The Creation myths which exist in almost all religions invariably take their images from real life, for example, the image of the potter who gives form to formless clay. In the opinion of Gordon Childe, the story of the Creation in the first book of Genesis reflects the fact that, in Mesopotamia the land was indeed separated from the waters "in the Beginning," but not by divine intervention:
"The land on which the great cities of Babylonia were to rise had literally to be created; the prehistoric forerunner of the biblical Erech was built on a sort of platform of reeds, laid criss-cross upon the alluvial mud. The Hebrew book of Genesis has familiarised us with much older traditions of the pristine condition of Sumer—a ‘chaos’ in which the boundaries between water and dry land were still fluid. An essential incident in ‘The Creation’ is the separation of these elements. Yet it was no god, but the proto-Sumerian themselves who created the land; they dug channels to water the fields and drain the marsh; they built dykes and mounded platforms to protect men and cattle from the waters and raise them above the flood; they made the first clearings in the reed brakes and explored the channels between them. The tenacity with which the memory of this struggle persisted in tradition is some measure of the exertion imposed upon the ancient Sumerians. Their reward was an assured supply of nourishing dates, a bounteous harvest from the fields they had drained, and permanent pastures for flocks and herds." (17)
Man’s earliest attempts to explain the world and his place in it were mixed up with mythology. The Babylonians believed that the god Marduk created Order out of Chaos, separating the land from the water, heaven from earth. The biblical Creation myth was taken from the Babylonians by the Jews, and later passed into the culture of Christianity. The true history of scientific thought commences when men and women learn to dispense with mythology, and attempt to obtain a rational understanding of nature, without the intervention of the gods. From that moment, the real struggle for the emancipation of humanity from material and spiritual bondage begins.
The advent of philosophy represents a genuine revolution in human thought. Like so much of modern civilisation, we owe it to the ancient Greeks. Although important advances were also made by the Indians and Chinese, and later the Arabs, it was the Greeks who developed philosophy and science to its highest point prior to the Renaissance. The history of Greek thought in the four hundred year period, from the middle of the 7th century B.C., constitutes one of the most imposing pages in the annals of human history.
The whole history of philosophy from the Greeks down to the present day consist of a struggle between two diametrically opposed schools of thought—materialism and idealism. Here we come across a perfect example of how the terms used in philosophy differ fundamentally from everyday language.
When we refer to someone as an "idealist" we normally have in mind a person of high ideals and spotless morality. A materialist, on the contrary, is viewed as an unprincipled so-and-so, a money-grubbing, self-centred individual with gross appetites for food and other things—in short, a thoroughly undesirable character.
This has nothing whatever to do with philosophical materialism and idealism. In a philosophical sense, idealism sets out from the view that the world is only a reflection of ideas, mind, spirit, or more correctly the Idea, which existed before the physical world. The crude material things we know through our senses are, according to this school, only imperfect copies of this perfect Idea. The most consistent proponent of this philosophy in Antiquity was Plato. However, he did not invent idealism, which existed earlier.
The Pythagoreans believed that the essence of all things was Number (a view apparently shared by some modern mathematicians). The Pythagoreans displayed a contempt towards the material world in general and the human body in particular which they saw as a prison where the soul was trapped. This is strikingly reminiscent of the outlook of mediaeval monks. Indeed, it is probable that the Church took many of its ideas from the Pythagoreans, Platonists and Neo-Platonists. This is not surprising. All religions necessarily set out from an idealist view of the world. The difference is that religion appeals to the emotions, and claims to provide a mystical, intuitive understanding of the world ("Revelation"), while most idealist philosophers try to present logical arguments for their theories.
At bottom, however, the roots of all forms of idealism are religious and mystical. The disdain for the "crude material world" and the elevation of the "Ideal" flow directly from the phenomena we have just considered in relation to religion. It is no accident that Platonist idealism developed in Athens when the system of slavery was at its height. Manual labour at that time was seen, in a very literal sense, as a mark of slavery. The only labour worthy of respect was intellectual labour. Essentially, philosophical idealism is a product of the extreme division between mental and manual labour which has existed from the dawn of written history down to the present day.
The history of Western philosophy, however, begins not with idealism but with materialism. This asserts precisely the opposite: that the material world, known to us and explored by science, is real; that the only real world is the material one; that thoughts, ideas and sensations are the product of matter organised in a certain way (a nervous system and a brain); that thought cannot derive its categories from itself, but only from the objective world which makes itself known to us through our senses.
The earliest Greek philosophers were known as "hylozoists" (from the Greek, meaning "those who believe that matter is alive"). Here we have a long line of heroes who pioneered the development of thought. The Greeks discovered that the world was round, long before Columbus. They explained that humans had evolved from fishes long before Darwin. They made extraordinary discoveries in mathematics, especially geometry, which were not greatly improved upon for one and a half millennia. They invented mechanics and even built a steam engine. What was startlingly new about this way of looking at the world was that it was not religious. In complete contrast to the Egyptians and Babylonians, from whom they had learnt a lot, the Greek thinkers did not resort to gods and goddesses to explain natural phenomena. For the first time, men and women sought to explain the workings of nature purely in terms of nature. This was one of the greatest turning-points in the entire history of human thought. True science starts here.
Aristotle, the greatest of the Ancient philosophers, can be considered a materialist, although he was not so consistent as the early hylozoists. He made a series of important scientific discoveries which laid the basis for the great achievements of the Alexandrine period of Greek science.
The Middle Ages which followed the collapse of Antiquity were a desert in which scientific thought languished for centuries. Not accidentally, this was a period dominated by the Church. Idealism was the only philosophy permitted, either as a caricature of Plato or an even worse distortion of Aristotle.
Science re-emerged triumphantly in the period of the Renaissance. It was forced to wage a fierce battle against the influence of religion (not only Catholic, but also Protestant, by the way). Many martyrs paid the price of scientific freedom with their lives. Giordano Bruno was burnt at the stake. Galileo was twice put on trial by the Inquisition, and forced to renounce his views under threat of torture.
The predominant philosophical trend of the Renaissance was materialism. In England, this took the form of empiricism, the school of thought that states that all knowledge is derived from the senses. The pioneers of this school were Francis Bacon (1561-1626), Thomas Hobbes (1588-1679) and John Locke (1632-1704). The materialist school passed from England to France where it acquired a revolutionary content. In the hands of Diderot, Rousseau, Holbach and Helvetius, philosophy became an instrument for criticising all existing society. These great thinkers prepared the way for the revolutionary overthrow of the feudal monarchy in 1789-93.
The new philosophical views stimulated the development of science, encouraging experiment and observation. The 18th century saw a great advance in science, especially mechanics. But this fact had a negative as well as a positive side. The old materialism of the 18th century was narrow and rigid, reflecting the limited development of science itself. Newton expressed the limitations of empiricism with his celebrated phrase "I make no hypotheses." This one-sided mechanical outlook ultimately proved fatal to the old materialism. Paradoxically, the great advances in philosophy after 1700 were made by idealist philosophers.
Under the impact of the French revolution, the German idealist Immanuel Kant (1724-1804) subjected all previous philosophy to a thorough criticism. Kant made important discoveries not only in philosophy and logic but in science. His nebular hypothesis of the origins of the solar system (later given a mathematical basis by Laplace) is now generally accepted as correct. In the field of philosophy, Kant’s masterpiece The Critique of Pure Reason was the first work to analyse the forms of logic which had remained virtually unchanged since they were first developed by Aristotle. Kant showed the contradictions implicit in many of the most fundamental propositions of philosophy. However, he failed to resolve these contradictions ("Antinomies"), and finally drew the conclusion that real knowledge of the world was impossible. While we can know appearances, we can never know how things are "in themselves."
This idea was not new. It is a theme which has recurred many times in philosophy, and is generally identified with what we call subjective idealism. This was put forward before Kant by the Irish bishop and philosopher George Berkeley and the last of the classical English empiricists, David Hume. The basic argument can be summed up as follows: "I interpret the world through my senses. Therefore, all that I know to exist are my sense-impressions. Can I, for example, assert that this apple exists? No. All I can say is that I see it, I feel it, I smell it, I taste it. Therefore, I cannot really say that the material world exists at all." The logic of subjective idealism is that, if I close my eyes, the world ceases to exist. Ultimately, it leads to solipsism (from the Latin "solo ipsus"—"I alone"), the idea that only I exist.
These ideas may seem nonsensical to us, but they have proved strangely persistent. In one way or another, the prejudices of subjective idealism have penetrated not only philosophy but also science for a great part of the 20th century. We shall deal more specifically with this trend later on.
The greatest breakthrough came in the first decades of the 19th century with George Wilhelm Friedrich Hegel (1770-1831). Hegel was a German idealist, a man of towering intellect, who effectively summed up in his writings the whole history of philosophy.
Hegel showed that the only way to overcome the "Antinomies" of Kant was to accept that contradictions actually existed, not only in thought, but in the real world. As an objective idealist, Hegel had no time for the subjective idealist argument that the human mind cannot know the real world. The forms of thought must reflect the objective world as closely as possible. The process of knowledge consist of penetrating ever more deeply into this reality, proceeding from the abstract to the concrete, from the known to the unknown, from the particular to the universal.
The dialectical method of thinking had played a great role in Antiquity, particularly in the naïve but brilliant aphorisms of Heraclitus (c.500 B.C.), but also in Aristotle and others. It was abandoned in the Middle Ages, when the Church turned Aristotle’s formal logic into a lifeless and rigid dogma, and did not re-appear until Kant returned it to a place of honour. However, in Kant the dialectic did not receive an adequate development. It fell to Hegel to bring the science of dialectical thinking to its highest point of development.
Hegel’s greatness is shown by the fact that he alone was prepared to challenge the dominant philosophy of mechanism. The dialectical philosophy of Hegel deals with processes, not isolated events. It deals with things in their life, not their death, in their inter-relations, not isolated, one after the other. This is a startlingly modern and scientific way of looking at the world. Indeed, in many aspects Hegel was far in advance of his time. Yet, despite its many brilliant insights, Hegel’s philosophy was ultimately unsatisfactory. Its principal defect was precisely Hegel’s idealist standpoint, which prevented him from applying the dialectical method to the real world in a consistently scientific way. Instead of the material world we have the world of the Absolute Idea, where real things, processes and people are replaced by insubstantial shadows. In the words of Frederick Engels, the Hegelian dialectic was the most colossal miscarriage in the whole history of philosophy. Correct ideas are here seen standing on their head. In order to put dialectics on a sound foundation, it was necessary to turn Hegel upside down, to transform idealist dialectics into dialectical materialism. This was the great achievement of Karl Marx and Frederick Engels. Our study begins with a brief account of the basic laws of materialist dialectics worked out by them.
Garment workers show the way
New wave of struggle in Bangladesh
by By Mushtuq Husain, Dhaka, Bangladesh
Bangladesh is in the grip of a fresh round of protests by garment workers.
Mass demonstrations and confrontations with the police and factory bosses are taking place in the capital, Dhaka, the second largest city, Chittagong, and the northern Export Processing Zone in Nilphamari.
In July this year, following months of struggle, garment workers reluctantly agreed to an insignificant pay rise brokered by the government and the leaders of fake trade unions. The new wage rates would, they said, be introduced after four months.
But as the time came for the new agreement to be implemented many factory owners refused to comply, and, even where they did, they did so in a way that discriminated against experienced workers.
Sensing they could pull a trick, firms downgraded experienced staff before the increase was due. The result has been that many workers have seen only a nominal improvement in their pay – and recent sharp increases in food prices have offset even that limited gain – and bosses are still refusing to allow genuine trade unions to operate inside the factory.
Meanwhile, the garment sector has grown by a startling 38 percent this year.
The combination of these issues is contributing to rising anger and agony among the workers.
On Saturday 11 December garment workers in Savar, Rupganj and Gazipur (all of which neighbour Dhaka) began agitating for the proper implementation of the new wage structure.
They were joined the following day by workers in the port city of Chittagong. Anger grew as bosses at South Korean chain, YoungOne, withdrew an increased food price allowance, as well as refusing to pay the new wage rate.
As thousands of workers took to the streets and blocked roads, the newly established “industrial police” swung into action and fired on the protests. They killed 4 workers and injured at least 225 others.
The repression sparked volcanic eruption of protest not only in Chittagong, but also in Dhaka and the north-western Nilphamari Uttara Export Processing Zone.
Garment workers blocked the highway linking Dhaka and Hazrat Shah Jalal international airport. Their anger was so deep that several policemen had to swim across a canal beside the airport highway to save themselves from their wrath. A good number of police were injured, and many vehicles damaged in the clashes.
A ruling party MP was chased by the protesting workers in Chittagong.
But police are attempting to exact their revenge. They have since filed over 30,000 cases against workers and have arrested a leftist woman trade union leader. Several other union leaders are being hunted by the police.
In the wake of the protests, the government’s labour minister said he would review the “anomalies” in the new wage structure, but this was quickly contested by the factory owners’ association.
Meanwhile, the home minister branded agitating workers as “culprits and conspirators” and the prime minister warned workers not to associate with “destabilising agents”.
The grave situation inside the garment industry was illustrated on Tuesday 14 December when a fire broke out in Ha-Meem factory, and claimed 31 lives. The government and owners moved quickly to claim the disaster was the result of “sabotage”, rather than their scant disregard for health and safety regulations.
Ministers and factory owners would have liked to believe that they had quelled the workers’ anger with the deal they reached with fake union leaders in the summer. This latest outburst of protest shows that nothing could be further from the truth.
Panorama
The light and the dark
A review of Eric Hobsbawm, Age of Extremes, The Short Twentieth Century 1914-1991 (London, 1994)£20JOHN REES
The opening pages of Eric Hobsbawm's great panorama of the 20th century are devoted to a series of 12 quotations from famous intellectuals, each no more than a sentence or two long, in which they struggle to catch the essence of their century. These views fall into three broad categories--optimists, pessimists and the fashionably agnostic.
For a minority, it is, in spite of everything, a century of scientific or human progress. 'There have been revolutions for the better in this century', as Rita Levi Montalcini, the Italian Nobel prize winner, argues, citing the 'emergence of women after centuries of repression'.
The majority, however, incline to pessimism. In the case of novelist and concentration camp survivor Primo Levi such emotions are only too understandable. But even Isaiah Berlin and Spanish anthropologist Julio Caro Baroja, who both admit having suffered no personal hardship, find their age, respectively, 'the most terrible century in Western history' and a century of 'terrible events which humanity has lived through'. For writer William Golding it is 'the most violent century in human history'.
Fashionable agnosticism is perhaps under-represented by historian Franco Venturi. His remarks are composed of two sentences, the first of which seems to be a resignation note for his whole profession: 'Historians can't answer this question'. But, in the way of academics, his second sentence is a lifetime re-employment contract: 'For me the 20th century is only the ever-renewed effort to understand it.'
It is not the least of Eric Hobsbawm's virtues that he has stood out against this kind of postmodern defeatism. He is still committed to the idea that history can be understood, can be explained, and that there is a difference between the subjective prejudices of the writer and the real events which are being described.
A still greater virtue is that Hobsbawm does not give in to either the facile optimism or the understandable pessimism displayed by the comments he gathers together on the opening pages of the Age of Extremes. As the book's title suggests, Hobsbawm sees the contradictory nature of our world: unimaginable wealth piled high beside indescribable poverty, machinery capable of unheard of productivity standing beside unbelievably destructive weapons, the most inhumane and brutal oppression calling forth the most courageous and principled resistance. Perhaps Yehudi Menuhin comes closest to catching this mood when he describes the century as one which has 'destroyed all illusions and ideals' yet also 'raised the greatest hopes ever conceived by humanity'.
The structure of the Age of Extremes follows this pattern. It rightly sees the first half of the 20th century as the 'Age of Catastrophe'--the period of the First World War, the rise of Italian fascism, the demise of the Russian Revolution, the slump of the 1930s, the rise of Nazi Germany, the defeat of the Spanish Revolution, and the Second World War. The second part of the book, 'The Golden Age', traces the long post-war boom which accompanied the Cold War and decolonisation. Finally, 'The Landslide' charts the collapse of economic prosperity, the end of Stalinism (or socialism as Hobsbawm mistakenly calls it), the close of the Cold War and the re-emergence of economic crisis and political instability.
All this means that Hobsbawm has the broad measure of a century which threatened, even in its most prosperous years, mass destruction and which called forth, even in its blackest moments, forces which could secure a better world. This alone sets Hobsbawm apart from those theorists who assume that the history of the century, especially that of its closing years, self evidently shows the superiority of liberal democracy and free market capitalism--former US state department official Francis Fukuyama is probably the best known.1 It also mostly sets Hobsbawm apart from those determinists for whom the growth of the world's population and the progress of technology spell the doom of humanity, although Age of Extremes is not entirely above giving way to this kind of millennial gloom on occasions.2
Sometimes these strengths carry over into Hobsbawm's account of the turning points of 20th century history. He is generally good, for instance, on Lenin and the Russian Revolution.3 Hobsbawm stayed in the British Communist Party until it collapsed and so will have heard the McCarthyite view of the Bolsheviks all too frequently the first time round to be overly impressed now that it is being recycled in the wake of events in Eastern Europe. He is insistent that 'Contrary to the Cold War mythology, which saw Lenin essentially as an organiser of coups, the only real asset he and the Bolsheviks had was the ability to recognise what the masses wanted; to, as it were, lead by knowing how to follow'.4 More surprisingly, Hobsbawm gives due weight to the central perspective of the October Revolution:
Lenin's programme... gamble[d] on the conversion of the Russian Revolution into a world, or at least a European, revolution. Who--he said so often enough--could imagine that a victory for socialism 'can come about... except by the complete destruction of the Russian and European bourgeoisie'?5
Hobsbawm is similarly clear sighted about how the 'years of unbroken crisis and catastrophe, German conquest and penal peace, regional breakaways, counter-revolution, civil war, foreign armed intervention, hunger and economic collapse' undermined the revolution. The Bolsheviks, he rightly argues:
could have no strategy or perspective beyond choosing, day by day, between decisions needed for immediate survival and the ones which risked immediate disaster. Who could afford to consider the long term consequences for the revolution of decisions which had to be taken now, or else there would be an end to the revolution and no further consequences to consider?6
But once outside the narrow confines of the immediate revolutionary events Hobsbawm's political background begins to show its darker side. It was Stalin who formulated the theory of 'socialism in one country', denying the possibility of Russia relying on the potential of world revolution. Hobsbawm seems to supply retrospective justification for this view. So, although we are told that 'a wave of revolution swept across the globe in the two years after October, and the hopes of the embattled Bolsheviks did not seem unrealistic', the general impression given does not do justice to the depth of the world revolution or to how close it came to hitting its mark. The crucial German revolution is, for instance, described at one point as 'an illusion' since 'the bulk of German revolutionary soldiers, sailors and workers remained... moderate and law abiding'.7
Since Hobsbawm underestimates the intensity of the revolutionary upsurge, he is under no special obligation to explain its failure, which had a good deal to do with the Stalinisation of the Communist International. Nor does he have to present the rise of the Stalinist bureaucracy as anything other than the regrettable but unavoidable result of the pressure of events. This then establishes the continuity between the revolutionary era and the whole subsequent history of Stalinism--so that the chapter on world revolution generalises wildly and unconvincingly past the 1920s and on to Mao's China and the 'second great wave of world revolution, from 1944 to 1949', by which he appears to mean the invasion of Eastern Europe by the Russian army.8
Indeed, Hobsbawm even goes so far as to write of the post-war world that 'the net effect of 12 years of National Socialism was that large parts of Europe now lay at the mercy of the Bolsheviks'.9 Yet he knows that virtually the entire leadership of the Bolshevik Party and a great proportion of its rank and file of 1917 had vanished into Stalin's gulag during the 1930s. Certainly there was nothing of it remaining by 1945. Failure to acknowledge the reality and completeness of this counter-revolution necessarily distorts Hobsbawm's view of the century.
The shame of Age of Extremes is that the strengths of Hobsbawm's generally Marxist approach are so often cancelled by the legacy of his politics. The actual historical account therefore becomes an infuriating mix of interesting detail and description coupled to a failure to really explain the turning points of 20th century history.10
Nothing could better illustrate the bind in which Hobsbawm finds himself than his account of the Spanish Revolution of 1936. We are told that 'the Spanish people's reaction to the [Franco] coup was undoubtedly revolutionary' and that, in spite of this, 'the Spanish government and, more to the point, the communists who were increasingly influential in its affairs, insisted that social revolution was not their object, and, indeed, visibly did everything within their power to control and reverse it, to the horror of revolutionary enthusiasts'. He goes on, with commendable honesty, to admit that:
The interesting point is that this was not mere opportunism or, as the purists on the ultra Left thought, treason to the revolution. It reflected a deliberate shift from an insurrectionary to a gradualist.... even a parliamentary, way to power.11
This electoralist approach is then praised because it described 'with considerable accuracy the shape of politics in the anti-fascist war of 1939-45' and that 'the logic of anti-fascist war led towards the Left'.
The remarkable fact in all this is that we are never given any account of why, when confronted with such a successful policy, Franco triumphed. Neither are we told how it was that the poor old wrongheaded 'revolutionary purists' (in fact, figures as politically divergent as Trotsky and Independent Labour Party member George Orwell) were able to predict that the Communist Party's policy would lead to the fall of the Republican government and to the destruction of the CP itself.
In reality of course the CP's policy amounted to a policy of counter-revolution. It paralysed and disorganised working class resistance to Franco just when it most needed to be extended and defended. The CP attacked both physically and politically the leaders and organisations of the Spanish Revolution and used the authority they derived from the support given to the Republican forces by the USSR to ensure that the government bent to their will. Hobsbawm's sole gesture towards explaining the defeat of the Republican side is to point to its internal divisions. But the CP was responsible for helping to create these divisions and for resolving them at the expense of workers' control in the factories, the agrarian revolution and the existence of any organisation to the left of the CP. When the revolutionary momentum was halted, the right wing punished the error ruthlessly.12
And while the course of the Second World War certainly radicalised working people throughout Europe, it was the CP's new found parliamentarianism which prevented this from resulting in any far reaching social transformation. Crucially, for instance, it brought Italian workers four generations of right wing government and French workers the de Gaulle regime. In both cases the CP's strategy led to their own exclusion from real influence.13 Certainly the logic of war led to the left, but the logic of the CP's strategy led to defeat.
But Hobsbawm's residual attachment to the disappeared world of Moscow centred 'communism' carries an even greater disabling burden: his explanation of the rise and fall of the long post-war boom, necessarily entailing an account of the collapse of the Eastern bloc, never rises above the level of description. The fundamental role of arms spending in sustaining and then destroying the boom is never analysed because to do so would mean seeing the Eastern bloc as regimes whose military and economic competition with the West defined the nature of the post-war world economy.14 The way in which arms spending first boosted the world economy and then, since it was unequally born by the major powers, undermined the competitiveness of its biggest contributors and therefore its own effectiveness, is not fully grasped.
Even so, the insight and detail are often impressive--the chapter on 'Third World and Revolution', for instance, is strong on the class make up and aims of the leaders of the Third World revolutions of the 1950s to 1970s. The way in which the popular image of guerrilla struggles has obscured the contribution of working class actions to the process of decolonisation is well described. The fact that the leaders of these revolutions were young and middle class and the fact that they often harked back to an older, pre-1917 tradition of agrarian struggle is usefully recalled. The distance between their political programme--land reform plus modernisation plus national independence--and the original Marxist conception of revolution has been obscured by the Cold War desire to see every threat to American interests as emanating from Moscow. Hobsbawm redresses the balance. But still the significance of all this in the wider history of the Cold War is undermined by the weakness of the theoretical framework which cannot stand the weight of explanation demanded of it.
The same flaw reappears time and again. It is there in the cringe inducing praise for Gorbachev and the snide asides reserved almost exclusively for any political current to the left of the CP. Worst of all, Hobsbawn accepts that political defeat and technological change have undermined the power of the organised working class and so eroded both the possibility of revolution and the voting base of Labour and social democratic parties. This last claim is an extension of his original article, 'The Forward March of Labour Halted', published in the now defunct Marxism Today. It is a rather strange conclusion when, for instance, France has had a Socialist Party president, Spain a Socialist Party government and Sweden has had a social democrat government for nearly as long as the Tories have been in power in Britain--and when even here the Labour Party is now 40 points ahead of the Tories in opinion polls.
There are two other faults which, although minor, are worth noting. The first is that Hobsbawm has chosen to inject a personal tone into his narrative which is often irrelevant and nearly always irritating. Is it, for instance, the best way of illustrating the debilitating specialisation which has developed in academia in the 20th century to be told that Hobsbawm himself was at Cambridge at the same time as Crick and Watson were discovering the structure of DNA and that, 'though I even recall meeting Crick socially at the time, most of us were simply not aware that these extraordinary developments were being hatched within a few tens of yards of my college gates, in laboratories we passed regularly and pubs where we drank'?15 Hobsbawm, like Woody Allen's Leo Zelig, seems to pop up all over the century giving us his particular view of events. But memoir and history, particularly the kind of grand history that Hobsbawm specialises in, are not comfortable bedfellows.
A second, related, point is that the personal judgments which Hobsbawm makes often seem based on no more than the kind of ill tempered snobbiness which readers expect from letter writers to the Daily Telegraph. What does it mean for Hobsbawm to tell us that 'no one who has been asked by an intelligent American student whether the phrase "Second World War" meant that there had been a "First World War" is unaware that knowledge of even the basic facts of the century cannot be taken for granted'?16 Is this the reflex anti-Americanism so common among CP members during the Cold War, or a lament for declining standards in education, or a donnish joke? Take your pick--but any one of them diminishes a book like this.
Similarly, Hobsbawm tells us that for his generation history was 'part of the texture of our lives' (in a way which it is not for younger people) because 'streets and public places were still called after public men and events (the Wilson station in pre-war Prague, the Metro Stalingrad in Paris), when peace treaties were still signed and therefore had to be identified (Treaty of Versailles)...'17 Now, were Hobsbawm to take a short trip outside his Hampstead home he might come across Hackney's CLR James Library (named after the black nationalist and sometime Trotskyist), the Isle of Dogs' Jack Dash House (after the CP dockers' leader), the huge granite head of Nelson Mandela outside the Royal Festival Hall (and a number of streets and public buildings now bearing his name) or the carved head of black nationalist Marcus Garvey in the entrance hall of the Tottenham Leisure Centre. And a brief glimpse at the daily papers might reveal not only that treaties continue to be signed (for instance, SALT I, SALT II and START) but that they are also sometimes still named after places (the treaties of Rome and Maastricht spring to mind).
This bad humour is more than the product of a liverish disposition or old age. It is the mark of a historian who knows that the century is ending as badly as it began, confronting humanity with the choice described in the Communist Manifesto: 'either social revolution or the common ruin of the contending classes'.18 Such a stark choice is inevitably posed once we raise our eyes from the small events of everyday life and look back over a century which has seen more wars and revolutions, more social crises and catastrophes, than any previous 100 year period. For those Marxists of Hobsbawm's generation the decision for or against socialism was inevitably bound to the question of whether they were for or against Stalinism. Yet to be for Stalin was to be against genuine socialism and democracy in Russia and, eventually, as the Spanish Revolution demonstrated beyond question, everywhere else.
For a long time Hobsbawm's historical work could avoid meeting this fact head on. As he has often said, the tacit agreement between the CP and the CP historians' group was that they could be mostly free of party control so long as they avoided writing about the 20th century. Hobsbawm kept the bargain until the end, loyally elaborating the CP line where current politics were concerned but staying safely in the long 19th century when it came to historical writing. The death of the CP has released him from that bargain, but not from the attitude of mind which went with it. Age of Extremes is, consequently, a huge landscape painting of the century, but one painted by an artist who has lost his sense of perspective. And so, despite his initial denial of pessimism, Hobsbawm's world stands in shadow, repeating the dilemma with which it opened:
If humanity is to have a recognisable future, it cannot be by prolonging the past or the present. If we try to build the third millennium on that basis, we shall fail. And the price of failure, that is to say, the alternative to a changed society, is darkness.
These very last sentences are a clarion call for change, but one issued more in the hope than the expectation that it will be answered. Hobsbawm's version of Marxism can see the contradiction at the heart of the century but has long since failed to explain how working people can resolve it.
Notes
- See his The End of History and the Last Man (Penguin, 1993).
- See, for instance, P Kennedy, Preparing for the 21st Century (London, 1993).
- Hobsbawm seems, in this respect at least, to have recovered his composure after the shock of the collapse of the Eastern European regimes. His initial reaction was to distance himself much more completely from the whole experience of the October revolution. See his 'Waking from History's Great Dream', Independent on Sunday, 4 February 1990, where the Russian Revolution is described as 'a freak result' of the age of catastrophe which might have been avoided if the Bolsheviks had heeded Menshevik warnings.
- E Hobsbawm, Age of Extremes (London, 1994), p61.
- Ibid, p63.
- Ibid, p64.
- Ibid, p68.
- Ibid, p75.
- Ibid, p175.
- Perry Anderson has made a similar point in his Guardian review: 'Hobsbawm stresses that the purpose of his book is to explain, not to describe events. But at three crucial turning points--the Great Depression, the onset of the post-war boom, and the slide into "stagflation"--he admits that real explanation lies beyond its scope, settling essentially for description.'
- E Hobsbawm, op cit, p162.
- It was only the Bolsheviks' insistence on deepening the revolution in the face of the attempted military coup headed by Kornilov in 1917 which prevented, as Trotsky put it, fascism being a Russian rather than an Italian word.
- See, for instance, the masterly Politics of War by Gabriel Kolko (second ed, New York, 1990).
- For an account of the arms economy see A Callinicos, J Rees, C Harman and M Haynes, Marxism and the New Imperialism (London, 1994); C Harman, Explaining the Crisis (London, 1987); M Kidron, Western Capitalism Since the War (London, 1968).
- E Hobsbawm, op cit, p527.
- Ibid, p3.
- Ibid, p4.
- This non-deterministic approach was central to Marx, quite contrary to Hobsbawm's claim that, for Marx, 'the class struggle between the bourgeoisie and the proletariat... could only have one outcome.' As footnote 17 above, p57.
Jobless non-recovery to continue
Most analysts predict U.S. economy will grow by 3-4 percent, but unemployment to stay high
By Kevin G. Hall
McClatchy Newspapers
Published on Saturday, Dec 25, 2010
WASHINGTON: The year 2011 should be a happy one for the U.S. economy, according to forecasts from mainstream economists, although their predictions over the past several years have been about as accurate as the local weatherman's.
Most economists predict growth in the range of 3 percent next year. The more optimistic ones see 4 percent.
That's a remarkably positive outlook compared to the past three years, but it's not enough to push unemployment down much.
''The story for growth I think is really quite simple. You come into this period with massive headwinds . . . so you're almost guaranteed a weak recovery,'' said Ethan Harris, head of developed markets economics in New York for Bank of America Merrill Lynch Global Research.
Harris projects a growth rate of around 3 percent next year despite Europe's debt crisis, new regulations on finance, high unemployment, the continuing hangover from the housing bust, and a host of other challenges.
His projection is right where 55 forecasters surveyed by the Wall Street Journal put it, and 3 percent isn't bad in normal times. But when it's coming out of a typical recession, the economy tends to grow at twice that rate. That underscores that this recession
was worse than normal, because it involved a collapsing financial sector.
The mild recovery means the jobless rate is likely to remain uncomfortably high next year. The U.S. economy added 1.2 million jobs from December 2009 to November 2010, but that's 300,000 fewer jobs than were lost in only the first two months of 2009. And 150,000 jobs are needed each month simply to absorb new entrants to the work force.
Still, Americans might begin to feel wealthier next year, if David Bianco is right. He's the chief U.S. stock analyst at Bank of America Merrill Lynch Global Research. He expects the benchmark S&P 500 Index to soar next year, powered by continuing record corporate profits.
''The corporate profit recovery during 2009 and 2010 has surprised everyone to the upside. It's been absolutely a V-shaped recovery,'' Bianco said.
Record corporate earnings aren't being driven entirely by the U.S. economy because 40 percent of the profits by companies in the S&P index are derived abroad, Bianco noted. ''The S&P is much more exposed to business spending, commodities demand and prices, exports and manufacturing activity. The U.S. economy is not the end-all, be-all for the S&P 500.''
The global economy is more robust than America's, pulled forward by big developing nations such as China, India and Brazil. It's likely to lift corporate profits and U.S. share prices in 2011. That will boost individual retirement accounts and 401(k) retirement plans of ordinary Americans, likely providing a psychological boost.
Preliminary retail numbers for December show that Americans are beginning to spend, a sign that they're feeling a bit more secure about their financial future.
But unemployment trends will dominate how Americans feel about their economy, and how they spend. The unemployment rate in November stood at 9.8 percent, and economists expect it to rise into double digits early next year as people who exited the labor force return to seek work in the reviving economy. Most forecasts see the jobless rate remaining above 9 percent all of next year.
A growing economy creates more jobs, yet many economists fear that a structural change might be afoot, with many jobs gone forever as companies have figured out how to do more with fewer workers.
''I think what's happening is we're having economic growth in the United States really generated through productivity gains, rather than employment gains,'' said John Silvia, the chief economist for Wells Fargo Securities in Charlotte, N.C.
Since the recession's official end in June 2009, he said, ''We've had the highest productivity gain of any economic recovery, and among the weakest in terms of employment gains. I think that's a change in the way we do business in the United States. . . . Unfortunately, I'm of the view that unemployment stays stuck at a higher level for a longer period of time.''
In a Dec. 15 report, the economic research division of Barclays Capital, part of Britain's giant Barclays bank, said that almost half of unemployed Americans have been jobless for more than six months.
''In our view, there are sound reasons to believe that the rise in unemployment will prove to be partly structural in nature and will not decline to pre-crisis levels as the cyclical recovery gathers momentum,'' the report said.
WASHINGTON: The year 2011 should be a happy one for the U.S. economy, according to forecasts from mainstream economists, although their predictions over the past several years have been about as accurate as the local weatherman's.
Most economists predict growth in the range of 3 percent next year. The more optimistic ones see 4 percent.
That's a remarkably positive outlook compared to the past three years, but it's not enough to push unemployment down much.
''The story for growth I think is really quite simple. You come into this period with massive headwinds . . . so you're almost guaranteed a weak recovery,'' said Ethan Harris, head of developed markets economics in New York for Bank of America Merrill Lynch Global Research.
Harris projects a growth rate of around 3 percent next year despite Europe's debt crisis, new regulations on finance, high unemployment, the continuing hangover from the housing bust, and a host of other challenges.
His projection is right where 55 forecasters surveyed by the Wall Street Journal put it, and 3 percent isn't bad in normal times. But when it's coming out of a typical recession, the economy tends to grow at twice that rate. That underscores that this recession
was worse than normal, because it involved a collapsing financial sector.
The mild recovery means the jobless rate is likely to remain uncomfortably high next year. The U.S. economy added 1.2 million jobs from December 2009 to November 2010, but that's 300,000 fewer jobs than were lost in only the first two months of 2009. And 150,000 jobs are needed each month simply to absorb new entrants to the work force.
Still, Americans might begin to feel wealthier next year, if David Bianco is right. He's the chief U.S. stock analyst at Bank of America Merrill Lynch Global Research. He expects the benchmark S&P 500 Index to soar next year, powered by continuing record corporate profits.
''The corporate profit recovery during 2009 and 2010 has surprised everyone to the upside. It's been absolutely a V-shaped recovery,'' Bianco said.
Record corporate earnings aren't being driven entirely by the U.S. economy because 40 percent of the profits by companies in the S&P index are derived abroad, Bianco noted. ''The S&P is much more exposed to business spending, commodities demand and prices, exports and manufacturing activity. The U.S. economy is not the end-all, be-all for the S&P 500.''
The global economy is more robust than America's, pulled forward by big developing nations such as China, India and Brazil. It's likely to lift corporate profits and U.S. share prices in 2011. That will boost individual retirement accounts and 401(k) retirement plans of ordinary Americans, likely providing a psychological boost.
Preliminary retail numbers for December show that Americans are beginning to spend, a sign that they're feeling a bit more secure about their financial future.
But unemployment trends will dominate how Americans feel about their economy, and how they spend. The unemployment rate in November stood at 9.8 percent, and economists expect it to rise into double digits early next year as people who exited the labor force return to seek work in the reviving economy. Most forecasts see the jobless rate remaining above 9 percent all of next year.
A growing economy creates more jobs, yet many economists fear that a structural change might be afoot, with many jobs gone forever as companies have figured out how to do more with fewer workers.
''I think what's happening is we're having economic growth in the United States really generated through productivity gains, rather than employment gains,'' said John Silvia, the chief economist for Wells Fargo Securities in Charlotte, N.C.
Since the recession's official end in June 2009, he said, ''We've had the highest productivity gain of any economic recovery, and among the weakest in terms of employment gains. I think that's a change in the way we do business in the United States. . . . Unfortunately, I'm of the view that unemployment stays stuck at a higher level for a longer period of time.''
In a Dec. 15 report, the economic research division of Barclays Capital, part of Britain's giant Barclays bank, said that almost half of unemployed Americans have been jobless for more than six months.
''In our view, there are sound reasons to believe that the rise in unemployment will prove to be partly structural in nature and will not decline to pre-crisis levels as the cyclical recovery gathers momentum,'' the report said.