All language subtitles for Masters.of.Money.S01E03.Karl.Marx.and.Marxian.Economics.1080p.AMZN.WEB-DL.DDP2.0.H.264-MRCS

Narrator: Dover.

The most dangerous man
in Europe

is about to arrive
on Britain's shores.

His preachings
are so incendiary,

he's been forced out
of his native country.

Only liberal Britain
will tolerate his presence

on her soil.

He heads to London,
to live in exile.

The year is 1849.

And the man is Karl Marx.

Incredibly, this most dangerous
of thinkers might offer the key

to understanding the mess
we're in today.

Most people know Marx
as the father of communism.

You might be surprised to hear

that most of what he wrote
was about capitalism.

And today, his ideas about that
are being taken seriously

right at the heart
of global business.

[indistinct clamouring]

- His analysis
was pretty on the button

and explains a lot,
I think,

about some of the things
that we see going on

around in our economy today.

Narrator: For Marx,
the best argument

against capitalism was that
it was inherently unfair.

His ideas on inequality

have more resonance than ever,
today.

- What Marx did do

is to install
this sense of urgency -

things cannot go on forever

the way they are.

Narrator: In this series,
we'll explore the lives

and revolutionary thinking

of three extraordinary men,

John Maynard Keynes,

Friedrich Hayek

and Karl Marx.

Their worlds were changing
as never before.

They saw
that the fate of nations

would hang
on the power of money.

And they had
radically different ideas

about how to control it.

Today, the stakes
could hardly be higher.

Of all the great thinkers
who analysed capitalism,

Marx had the most radical advice
of all.

Get rid of it.

Narrator: In 1989,

Karl Marx's reputation
lay in ruins.

For most of us,

the fall of the Berlin Wall

meant the end of Marx.

Millions rejected the horrors

of a violent and repressive
police state.

And because
the communist countries

claimed Marx
as their inspiration,

his ideas were cast aside,
as well.

Marx became associated
with communism.

Indelibly associated
with communism.

And indelibly associated
with communist regimes,

because these regimes
did their work

in the name of Marx.

So the association
was very, very powerful.

In fact,

it was they
who were claiming Marx

rather than Marx,
as it were, claiming them.

Narrator:
But in the last few years,

something strange has happened.

It's like
the global financial crisis

has brought Karl Marx
back from the dead.

Now, we still don't care
what he said about communism,

but people are going back to see
what he said about capitalism.

All its deep-seated flaws,

with a nagging doubt.

Is it all, now, coming true?

When times were good,

Marx was nowhere.

But now the Western economies
are in crisis,

he's attracting new interest,

right at the heart
of the economic establishment.

From a former IMF
chief economist...

- Marx is right
on a number of dimensions.

He certainly is right

that income inequality

can be a source
of tremendous tension.

Narrator: ..to the man who saw
the 2008 crisis coming...

- He understood
that there are situations

in which capitalism
and globalisation

can lead to economic crisis.

Narrator: ..and an economist
at one

of the world's leading banks.

- It's quite hard
to convince people

who live in Chelsea
or Chelmsford

that this is
of great relevance to them,

but, actually,
it's worth a bash.

Narrator: Marx's key insight

was that capitalism
was inherently unstable.

He said we'd lurch
from crisis to crisis,

and that society would become
increasingly unequal.

Marx divided the world
into bosses and workers.

For him, they would always
be at odds,

and that battle
was a recipe for crises.

To make profit, bosses squeeze
what they pay workers.

The crisis comes

when workers
then don't have enough money

to buy what bosses
are trying to sell them.

For decades after World War II,

all of that
looked completely wrong.

We'd had years of stable growth,

and workers were taking
a larger share of the pie.

But not anymore.

- Marx would explain this crisis
in terms of the fact

that ordinary people

haven't got enough money
to spend.

Why have they got enough money
to spend?

Because there's been
a big redistribution,

over the last few decades,

away from ordinary people

towards capital, towards wealth.

Narrator: And for Marx,
there's no turning back.

Capitalism would produce
bigger and bigger crises

and then, it would collapse.

- Marx had
a very simple formulation

about crises,

which is
that they are manifestations

of the fundamental flaws,

or contradictions,
as he called them,

of capitalism.

How would Marx have suggested
solving the crisis

is, of course,
by abolishing capitalism.

Narrator:
To understand the Marxist view

of the mess we're in,

we first have to see
the world today

as Marx might have seen it.

Capitalism's
most implacable critic was born

in the picture-postcard town
of Trier,

in what is now
Southwest Germany.

- Marx comes across
as a young man,

as this, sort of, energetic,

fiery, hairy figure.

He was known as 'The Wild Boar'
or 'The Maw',

which sort of points to
his sort of Levantine complex.

He was full of ideas,
he was full of debate.

He liked big drinking sessions

and then
deep philosophical debate

about the nature of Christ
and German Romanticism

and politics.

Narrator: As he studied,
Marx came to believe

the world was sharply divided

into those who own
the means of production,

the capitalists,

and those who owned nothing,
the workers.

The conflict
between these two groups,

for Marx,
shapes how society works.

- The foundations
of Marx's thinking

was materialism.

That when you cut away religion,

ideology, politics,
at its root

were the material relations
between man.

The need for food,

the need to have a roof
over your head,

this is what ultimately drives
so much of human interaction.

- What was unique in Marx,

he didn't see economy
just as a special sphere.

He saw economy
as the structuring principle

of the entire social totality.

And, so that what happens
in economy,

the way it structures
our ideologies and so on,

this, again,
is another lesson today.

Maybe even more pertinent

than in the time of,
times of Marx.

Narrator: We might see
a complex modern economy,

which all of us have a stake in,

but Marxists would say

the same old rules still apply.

For them, the divided society
Marx saw

is still, broadly, here today.

They see workers
still slaving away.

And capitalists,

or bourgeoisie,

still exploiting them,

always striving
to make more profit.

In Marx's world,

any capitalist that doesn't seek
maximum profit

is soon replaced
by one who does.

So, the system follows
a completely predictable course,

he would say,
to its own destruction.

It's not an idea
that many people accept.

- He was completely wrong.

Including the idea

that capitalism
was merely a phase,

and contained within it

the seeds
of its own destruction.

That's not the case.

Well, everything
is bound to collapse

if you wait long enough.

I mean, the Earth's going to,
you know,

be sucked into the sun, someday.
[chuckles]

And, of course,
what we're really talking about

when we talk about capitalism,

is individual liberty
and property rights.

Could those come to an end?

Well, they have in places.
It's possible,

but I'm not seeing
any signs of it.

Narrator: You'd be forgiven
for thinking

the total collapse
of capitalism

sounds a little implausible.

How could seeking profit

be so disastrous,

when it's done
such amazing things?

Just look at how we eat,
under capitalism.

We get fresh fruit flown in
from all over the world.

We can choose from 700 types
of breakfast cereal.

We have enough of it,

and it's all safe to eat.

This incredible plenty,

and the technology
it depends on,

didn't come from the state.

It's what happens

when you let capitalists
compete for profit.

They didn't do it
for our benefit,

they did it
because it made them rich.

So, at first glance,
Marx's idea

that capitalism's search
for profit

would be its downfall,
sounds absurd.

- Profit may often sound venal,
it may often sound wrong,

but it is
what pushes progress ahead.

Profit is actually what
drives the world forward.

And that's what Marx
could never quite handle.

The profit motive is essential.

I mean, after all,
what is the profit motive

if it's just a way of achieving

a better society,

by people wanting to better
their own individual lot?

In terms of economics,

Marxism is not
very much used today,

and that's because he was wrong
on several of the fundamentals.

And if you erect a building
on cracked foundations,

the building, itself,
is cracked.

Narrator: When you think of how,
fundamentally,

the profit motive has shaped
and enriched our world,

it's no wonder
Marx fell out of favour.

But we shouldn't dismiss Dr Marx
quite yet.

It's true, he talked quite a lot

about class exploitation,

misery, chaos.

But he didn't think capitalism
was all bad.

Far from it.

This cocktail bar
in London's Soho

hides a revolutionary past.

It used to be The Red Lion Pub,

site of a clandestine meeting
of communists in 1847

that would echo down the ages.

It was at that meeting
that they commissioned

Karl Marx and his sidekick,
Friedrich Engels,

to write one
of the most incendiary pamphlets

of all time,

'The Communist Manifesto'.

It goes through
a number of drafts.

Engels is the key drafter
on the texts,

but then Marx takes it away,

and in a sort of, you know,

massive essay crisis style,

just sits down
and writes the thing.

And that's the beauty of it.

Because it might have been
organised by a committee,

but it's written by one man.

And that energy, that brio,
that passion

which is in the manifesto,
comes from the fact

it has a single author
in the final stages,

which is Marx.

Narrator: You may know it
for its revolutionary calls

for a new age.

What might surprise you
is that it also contains

very perceptive and admiring
writing about capitalism.

I think what's surprising
of a lot of Marx's writing

is that you find,
in amongst the communism,

a lot of good analysis
of capitalism.

And, actually,
you also find within it

quite a lot of praise
for capitalism.

Marx's attitude
towards capitalism

is basically ambiguous.

At the same time,
he was honest here, Marx.

Ultra-fascinated.

He was fully aware that this

is the most productive,
dynamic system

in the history of humanity,
and so on.

He praises it
for its huge force,

for, as far as he can see it,
for progress.

For tossing aside the traditions
and the customs of the old world

and making way for a new one.

And I think
it's quite interesting

the more intelligent
modern Marxists

feel much the same way.

Narrator: The truth is,
Marx did understand

that the drive for profit

would achieve incredible things.

It's been the first to show

what man's activity
can bring about.

It has accomplished wonders
far surpassing

Egyptian pyramids,

Roman aqueducts

and Gothic cathedrals.

- He did really get
the kind of global aspect.

He got the idea that

people were suddenly being able
to get things

from all the way
around the world,

in a completely new way,
and the impact of that.

Narrator: The need
of a constantly expanding market

for its products

chases the bourgeoisie

over the entire surface
of the globe.

It must nestle everywhere,

settle everywhere,

establish connections
everywhere.

It creates a world
after its own image.

But you know,
there's got to be a downside

for the bourgeoisie.

Modern bourgeois society
is like the sorcerer,

who is no longer able to control
the powers of the netherworld,

whom he has called up
by his spells.

What the bourgeoisie
therefore produces, above all,

is its own gravediggers.

Its fall,

and the victory
of the proletariat,

are equally inevitable.

How can Marx think
capitalism is so brilliant,

and, also, so doomed?

Well, the answer lies
in how it treats the workers.

To understand
Marx's analysis of crises,

we have to first understand

the capitalism that he knew.

19th century capitalists

might have built wonders
surpassing Egyptian pyramids,

but they also
forced their workers

to endure
terrible conditions and pay.

- It is difficult
to overstate the horror

of industrialisation in Europe.

In 1829,

Liverpool, for example,

the life expectancy at birth
was about 28 years.

And that was the lowest age
since the Black Death.

So, the impact
of the Industrial Revolution

on life chances,
on life expectancy,

in the great cities of Europe,

in Hamburg, in Berlin,

in Manchester, in Liverpool,
in Birmingham, in London,

was absolutely terrifying.

This was a revolutionary epoch
of change,

which, for the working classes,

which, for the proletariat,
in the 1820s and 1830s,

had devastating consequences
for their standards of living.

Marx is certainly revered
amongst historians

as the pre-eminent analyst
of mid-19th-century capitalism.

No-one before Marx,
or possibly since,

had really,
has really been able

to get into that system

of mid-19th-century
Western-European capitalism,

based on a, kind of,

urban manufacturing set
of relationships.

Whether that's relevant today
is a very interesting question.

Narrator: The horrors
of Victorian working conditions

clearly shaped Marx's economics.

In his time,
minimum pay for proles

meant maximum profits
for bosses.

And any bosses
who did choose to pay more

usually went bust.

Subsistence wages
will always be paid

in the Marxian system.

So, now, subsistence wages,
of course,

is a little bit
of a flexible object, right?

What we think of
as the subsistence wage now

might not be the same
as Marx thought it was

in the mid-19th century.

But still,
there's no obvious way

that wages will arrive
above a subsistence level.

He thought there'd always be
downward pressure on wages,

and that wages would come down
to the minimum

that enabled bare survival.

They couldn't go lower
than that,

otherwise the workers would die.

But he thought
they'd be depressed

down to that minimum.

The reality, of course,
has been the opposite.

It has been
a continual advancement

in wages - year in, year out,
decade in, decade out.

Narrator: Marx was wrong.

He thought
it would all get so bad,

the workers
would overthrow the system.

Yet, even as he was writing,

reformers were beginning
to get rid

of the worst
employment practises.

Capitalism got kinder,
not nastier.

But the idea
that the competing interests

of bosses and workers
would cause crises,

well, that does seem relevant
today.

Marx wrote
that the ultimate cause

of all real crises

always remained the poverty

and restricted consumption
of the masses.

Put simply,
if workers aren't paid enough,

they don't have enough money
to spend in shops,

and the economy
doesn't stay afloat.

Some believe this idea

is very useful
in understanding the crisis

we're living through today.

Let's take a look
at the last 40 years of history

through the prism
of Marx's theories,

to show how they might explain
the mess we're in.

An imaginary 'Marxist
Broadcasting Corporation'

would see it all
as a good old 1970s-style

class struggle.

The fight is over wages.

Capitalists want to pay less,
the workers want to get more.

Man: [over megaphone]
All those in favour,

please show!

Narrator: In the '70s,
powerful trade unions

battled to keep wages high.

But then, we come to the '80s.

Fightback time
for the capitalists.

There she is, look,
can't you see her now? Look.

Narrator: Marx would have seen

Margaret Thatcher
and Ronald Reagan

as acting purely
in the interests

of the capitalist bosses.

It was their governments
that helped business,

by getting rid of the obstacles

that made it hard to cut wages.

- The vilest intimidation
we have seen

should never have happened.

It is the work of extremists.

It is the enemy within.

..and if they do not report
for work within 48 hours,

they have forfeited their jobs
and will be terminated.

Narrator: So, for the 'Marxist
Broadcasting Corporation',

the capitalists won
in the 1980s,

and they kept on winning.

The guaranteed high wages
and job security

that workers had enjoyed
until the '70s had gone.

And downward pressure on wages
started to lay the seeds

of the crisis we see today.

It's an appealingly
simple story,

but how much truth is there
in it?

Well, we know the Marxist view
of history

is right about one thing,

at least in Britain and America.

Earnings at the very top
have soared

in the last few years,

and everyone else
has been squeezed.

In Britain,
real earnings have been flat

or falling
for the best part of ten years,

since before the crisis.

In America,

that's been happening
since the 1970s.

- In the United States,

a full-time male worker,

median income has stagnated

for a third of a century.

No increase.

Household income today

is the same as it was

15 years ago.

All the increase to the income
has gone to the top.

The share of income

in the United States,

that was going to the top 1%
of the households,

20 years ago,

was around 12%.

Today, that share
is closer to 23%.

Narrator: Things haven't gone
that far in the UK,

but inequality's certainly
creeping up the agenda.

But rather than see it
as a deliberate strategy

on the part
of greedy capitalists,

we have to recognise
there are bigger forces at work.

A lot of it's down
to new technology.

Work previously done by hand

is now done by machines.

With fewer workers needed,

there are more competing
for every job,

meaning bosses
can pay them less.

But perhaps
the most significant factor

is globalisation.

With falling barriers to trade
around the world,

global business
has gained access

to a giant new pool
of cheaper labour.

- You have brought
into the market, now,

millions and millions
of new workers.

In China, in India,
in other parts of Asia,

in parts of South America,
Brazil, for instance.

So, that process has transformed

the capital labour ratio
on a global scale.

- Clearly,
competition from countries

around the world

has put pressure
on certain jobs,

typically jobs that can be done
at a distance.

So for example, an analyst,

can, as well, be sitting

in the Philippines
or in Mumbai,

to do the job that is done

at a much higher price
in New York.

Narrator: Many workers
in the rich countries

are now competing
with an industrial reserve army,

running into the billions.

- I think,
in emerging market economies,

there'd be an overwhelming vote

in favour of what has happened

because almost everyone

is better off than they were,
and would've been.

But that's less evident
in the industrialised world,

and many lower-paid people
have become even lower paid,

relative to those
who've prospered.

And that is a concern.

Narrator: It's an analysis
that rings true,

even for the leader
of the world's biggest economy.

[applause]

- Long before the recession,

jobs and manufacturing
began leaving our shores.

Technology made businesses
more efficient,

but also made some jobs
obsolete.

Folks at the top
saw their incomes rise

like never before.

But most hard-working Americans

struggled with costs
that were growing,

pay cheques that weren't,

and personal debt
that kept piling up.

Narrator: So, for Marx,

low wages
would be the root cause

of the crisis
we're living through today.

- Even leaving aside

the morality question
of whether it's fair

to have a highly unequal
distribution

of income and wealth,

even purely in terms
of economic efficiency,

having that redistribution
of income from labour capital,

from wages to profit,

there's a negative
economic effect.

Because it tends to reduce
aggregate demand,

because it reduces the income
of those who tend to spend more.

Narrator: Of course,
in the late 20th century,

that problem could be solved -
temporarily, of course.

Step forward, the credit card.

You had more inequality,

you had more concern
amongst the public,

and I think that put pressure
to do something.

Democracies work well
with pressure,

put pressure for the politicians
to do something

for the people
being left behind.

The right thing to do,
in my view,

would've been focus much more
on education,

on skill building.

What happened was
a more shorter-term solution,

which was, give them credit.

Narrator: With consumer credit,
people can carry on spending,

even if
they haven't got the money.

The economy stays afloat,

and the capitalists
still make their profit.

As we know, it went well beyond
credit cards.

What ultimately
brought the crisis to a head

was the billions borrowed
on mortgages.

People thought
the value of their house

would keep going up forever.

- Housing credit is beautiful.

Because if your house price
is increasing,

and you're borrowing

against the increasing value
of your house,

you don't feel you're borrowing
your way into debt.

Narrator: But, of course,
you are.

In America,
it happened on a massive scale.

There, as we know,

the capitalists
were getting richer and richer.

They couldn't spend
all of their extra money.

Driven, as ever,

by the desire
to make more profit,

they lent it out,
in riskier and riskier ways.

The name given to this lending

might well be familiar -

subprime.

- What we did is,
as the incomes of most Americans

were stagnating

or even declining, we said,

"Don't let it bother you.

"Keep spending
as if your income was going up."

And they did that very well.

I mean, who would oppose it?

The banks were making money,

the households
were getting their house,

the politicians
will have happy constituents.

I mean, there is nobody
who's going to be unhappy

in this process
until it collapses.

Subprime is the endgame,
if you like, of...

..the debt solution
to the lack of a market.

And it's the culmination
of trying to evade crises

which arise out of lack
of effective demand

in the market.

And then what you do
is you end up

creating a credit crisis,
instead.

So subprime is the end
of that process.

Narrator: And we all know
how it ended.

In retrospect,
it seems obvious,

lending to people
who couldn't afford it

wasn't a lasting solution
to anything.

It led to a housing bubble,
which burst,

threatening some of the world's
biggest banks.

And thanks
to our integrated world,

what started
in the United States spread

and infected the entire system,

causing a global recession.

Capital, when it's faced
with a problem,

usually seeks to move it around.

It moves it from one sector
to another,

or from one geographical region
from another.

Any part of the world
that's in economic difficulties

will seek to unload
those difficulties

on another part of the world.

What will also happen is that,

if there's a problem
in the banking system,

they will seek to move it
into the state system,

and if it's a problem
in the state system,

they'll try and move it

onto the taxation
and austerity of the people

to extract the wealth

from a population.

Narrator:
It's an extraordinary tale.

And a lot of people would say
it's completely wrong.

Marxism doesn't actually work,

but it keeps coming back,

'cause it makes
for a good story.

I don't think low wages
played any role at all

in causing the crisis.

The crisis was caused

by governments and central banks
flooding the market

with cheap credit
and cheap money,

because politicians
don't like the downturn

in an economy
that throws people out of work.

I think it may have,
to some degree,

increased the level
of indebtedness

that people went into
the crisis with,

which I think intensifies
how deep the crisis became.

But it wasn't
the underlying cause,

it was a contextual factor,
which made it a bit worse.

Narrator:
But the idea that low wages

may have contributed
to the crisis is gaining ground,

in some surprising places.

- It was on this trading floor.

It was probably the weekend
before Lehman's went bust

and it's, normally,
a little bit noisy.

But at the time,
you could hear a pin drop.

It was that deathly quiet.

And I could almost feel,
you know,

that the global system
was frozen.

And it was quite
a scary thought.

It took me back
to a lot of the things

that I used to read about
and study

when I was much younger,

the days when
I actually read Marx for fun.

It was a comment
that I posted up on a newswire,

and it was one of the most
commented-upon pieces

for quite a few weeks.

But there are a lot of people

who were quite opposed
to the idea

that anything
that was socialistic or Marxist

you know, could be a tool

considered serious
in the mainstream.

A lot of this hate mail,
I have to say,

came from the United States

and I was accused of being,
you know, an Obama clone.

So there was a lot
of negative reaction

from, I think,
people that probably,

predictably, you know,

had already tied
their own ideological colours

to the mast.

Narrator: But the people
who do find value in Marx

aren't necessarily
going to follow him all the way.

- I don't think
anybody seriously believes

that, you know,
this is all about,

the, you know,

dawn of the dictatorship
of the proletariat,

or anything like this.

I think Marx helps
in framing the problem,

but I think the solutions
have to be different,

given the different environment
we are in.

Narrator:
Except, Marx would insist

the trap is inescapable.

Capitalists must seek profit
above all else,

or they'll go out of business.

So why would they ever choose

to give workers
a bigger share of the pie?

- What Marx would say is that

we have to look for ways
out of this crisis

which look beyond
the restoration

of capitalist-class power.

And I think this is a time

when we actually need
to start thinking

about the revolutionary solution
again.

Narrator: But who exactly
is revolting against whom?

Marx divided the world neatly
into workers and capitalists,

but today, his stark distinction
is incredibly blurred.

Bosses work for themselves,
and workers own shares.

In our modern world,

enough of us do have a stake
in the system,

whether mobile phones
or pension plans,

to stave off talk
of armed revolt.

I think capitalism survives
because, at its core, it works.

It pushes progress.
It pushes people forward,

it appeals to a basic thing
in people's lives,

which is to try and get ahead,

to try and improve things
for their children.

The fact that more people
win from it than lose from it

is the thing
which keeps on pushing it ahead.

Narrator:
But what about the people

capitalism's failing?

What does Marx have to say
to them?

Incredibly, for all
his criticism of capitalism,

he offers us next to no idea

of what a fairer alternative
might look like.

As Marx entered his final years,

he seemed quite content
with the way things were.

He'd been poor
for a lot of his life,

but by 1856, he had enough money
to move to London's suburbs.

The young firebrand

now looked like
part of the establishment.

- He would spend his day
walking around Hampstead Heath.

He would spend his day
in correspondence.

He would spend his day,
you know, reading 'The Times'.

He would worry
about personal finances,

he would worry
about his daughters

and the expense
of their piano lessons.

I mean, he lived
a remarkably bourgeois life,

in many ways.

Narrator: Marx didn't want
to rush revolution.

To understand why,

we need to understand
his analysis of world history.

He saw the great sweep
of humanity's endeavours,

from the caveman

to the slave societies
of Greece and Rome,

to the feudalism
of kings and castles.

All of which was replaced,
in turn,

by our own capitalist system

of bosses and workers.

- Heave, ho!
[whip crack]

Narrator: Incredibly unfair,

but also, incredibly productive.

Marx said only when we'd got
everything we could

out of capitalism,

could we afford
to have a revolution.

In his words,

"The knell of capitalist
private property sounds.

"The expropriators
are expropriated."

All to be replaced by...

..more or less, nothing.

Irritatingly,

there's next to no alternative
laid out.

- Marx, basically,

was not the one
who simply gave us a blueprint,

you know, five stages
after capitalism, communism,

here you have
the basic guidelines,

what to do and so on. No, no!

It's up to us.
He just opened up the field.

- Is there an alternative
to capitalism?

I've no idea.

Well, I suppose there could be
all kinds of alternatives,

dead-silence, starvation...

..or the end of the world
or anything.

But I simply have no idea
if there is an alternative.

It doesn't occur to me.

It doesn't seem, to me,
to be of importance.

It's like saying, is there
an alternative to weather?

I think he would have written
a lot more,

had he lived ten years more,

on what a socialist republic
would look like.

And, who knows?

But that might have saved
the world a lot of bother.

[Soviet Russia anthem plays]

Narrator: Without his blueprint,
we all know what happened next.

There weren't any revolutions

in the rich,
developed countries,

as Marx predicted.

Instead, it happened in one
of the world's poorest nations.

Soviet Russia
may have left Marx far behind,

but it was an attempt
to try something else.

And many have drawn lessons
from its failure.

- The truth is, at the moment,

there are different forms
of capitalism.

Some have
slightly more social democracy,

some are closer
to laissez-faire,

and there's a continuum
between them.

But on the big argument,
about whether you really want

to have a communist system
or a capitalist one,

that is pretty much won
everywhere, I think.

There are more humane versions
of capitalism,

or more barbaric forms
of capitalism.

But I don't think
there's a systemic alternative

to capitalism.

Will there ever be?
Yes, I would think so.

I mean, you know,
nothing is forever.

Absolutely nothing.

And capitalism is not forever.

Narrator: But anyone looking
for a fairer alternative

knows they can't ever repeat

what happened east
of the Berlin Wall.

Dictatorship,
political oppression,

and millions of ruined lives.

From 1945 till 1989,

this was the main remand centre
for political prisoners

in communist East Germany.

Today, it's been turned
into a memorial.

It's possible
that places like this

explain why even capitalism's
toughest critics today

seldom talk seriously
about replacing it.

- You can see,
with all of this protest

in Europe, Greece
and so on...

I was in Spain, in Greece,

asking, always,
the same question.

OK, what do you want?

Apart from
some purely moralistic answers,

I didn't get any good,
concrete proposals.

You know, answers like,
"Oh, money should serve people,

"not people serving money."

My god, Hitler and everyone

would have agreed with this,
I'm sure.

You would've thought,

that with this implosion
of the banking system

at the heart of the capitalism
in the United States,

versus the United Kingdom
and so on,

there would be a huge rush

to Marxism
and extreme socialism.

That hasn't really happened.

It is quite surprising,
and I'm very pleased.

Narrator: But if memories
of this place do fade,

could there ever be
an alternative to capitalism?

Or should what happened here
be a lesson for all time?

- I think, if you remove
the free market,

you're removing
people's ability, freely,

to trade with each other.

To acquire the things they want,

and sacrifice for them,
the things that they value less.

You're removing people's ability

to enrich and improve
their lives.

It is a perfectly natural part
of the human condition.

Adam Smith said, the effort
of every person

to improve their condition.

You know,
he thought it was so basic.

If you deny people
the opportunity to do that,

then you'll have to build
some kind of compulsion into it.

You have to make people
behave in a way

in which they would not
spontaneously behave.

- If someone wants to seek
an alternative to capitalism,

then they're saying,
by seeking that alternative,

that capitalism is a system,

rather then a fact of life.

And they're saying that,
for instance,

that human nature
can be altered.

Fundamentally,
they're revealing themselves

as utopian.

And the problem with utopia

is that it can only ever
be approached

across a sea of blood,

and you never arrive.

- This is my big mantra,

when we leftists
are accused of utopians.

Maybe, but the only real utopia

is to think that,
with some cosmetic changes,

things can go on, indefinitely,
the way they are now.

[crowd sings
'The Internationale']

♪ Arise ye starvelings
from your slumbers ♪

♪ Arise ye criminals of want

♪ For reason in revolt
now thunders ♪

♪ And at last ends the age...

Narrator: Marx died in 1883.

In a speech at his grave,

his long-time friend
and collaborator,

Friedrich Engels, declared,

"His name and work will endure
through the ages."

[singing of 'The Internationale'
continues]

Narrator:
For most of the 20th century,

his name did endure,

though usually
for all the wrong reasons.

Still, there are plenty
of people today

who still believe
we should strive

for an alternative
to capitalism.

- Marx did bring together

concrete economic analysis,

with a certain
emancipatory hope.

The message,
it's still a beautiful one -

maybe you ordinary people
have a chance.

I'm not a great eulogiser,
actually,

of anyone,
to tell you the truth.

But if one were to write
a tribute to him,

one would go back,

to Marx's favourite character
in Greek mythology,

Prometheus,
who gave the earthlings fire.

And that is what Marx
gave citizens

all over the globe.

The fire necessary

to transform their lives,
forever.

[singing of 'The Internationale'
continues]

Narrator: But what value
does Marx have

for those less inclined
to revolution?

Fundamentally, Marx reminds us,

if capitalism doesn't work
for everyone,

it might not work at all.

- There is no doubt

that there have been
significant changes

in inequality

and in the distribution
of income,

which make you pause
about the benefits

of the developments of output
and prosperity that we've seen.

And I don't think you can afford
to believe

that the benefits
of a market economy

in bringing prosperity
will be there,

unless there is
a collective commitment

to keep the system going.

And that does require people
to believe

that everyone will benefit
in the end.

I think some of the ugliness
of capitalism

that he saw in the 19th century

seems to be reappearing
in the 20th and 21st.

In a way, we have to keep
our perspective on this.

Health conditions
are much better,

living standards are starting
from a higher level,

but it is still the case

that things aren't the way
they ought to be,

and they're not moving
in the way they should be.

We have to find a way
of creating jobs

which are broad-based,

which pay reasonable amounts.

But at the same time, you know,

without sort of going against
the basic laws of competition.

Narrator: Marx was right
to see capitalism

as inherently unstable,

and often unfair.

Keynes and Hayek saw that, too,

but Marx was the first.

And, unlike them,
he didn't think

we should find a way
to live with it.

He said capitalism
would bounce back

from crises and reinvent itself.

But, in the end,
a compelling alternative

would appear,
and capitalism would collapse.

For all that rings true,
now, in Marx,

on that, he seems to have been
dead wrong.

Captioned by Ai-Media
ai-media.tv