"Karl Marx Was Right"

good evening ladies and gentlemen and welcome to this intelligence squared debate on the motion Kal Marx was right capitalism post 2008 is falling apart under the weight of its own contradictions since the collapse of the Western banking system in 2007 to 2009 the advanced industrial economies have struggled to recover in spite of highly unorthodox measures huge monetary stimulus and yet the constraints of high public debt and anemic growth have proved as yet almost insurmountable is this an illustration of the inherent contradictions of capitalism the immiseration of the proletariat the rate of the profit the tendency of the rate of profit to fall or are we instead seeing some exceptional event brought about not by the contradictions of capitalism but by the failure of one particular segment of the economy the financial system and at the same time seeing the productive power of the market in other parts of the world notably China as you came into the hall you will have been asked your initial view after hearing the speeches from our distinguished panel you will be asked to vote on the motion in front of you you have a ticket with for or against when it comes to the votes you'll have a ballot box passed along the rows in front of you if you wish to vote for the motion you put the side of it with four in the box against but against in the box if you are undecided please put the whole voting card into the box the motion the proponents of the motion will speak first motion again Karl Marx was right capitalism post 2008 is falling apart under the weight of its own contradictions the speaker who's going to introduce that motion is Tristan hunt historian Labour MP and author of a biography of Friedrich Engels please welcome Tristram hunt Tristram your time startsnow Oliver thank you very much ladies and gentlemen in July 1851 friedrich engels the manchester cotton lord and co-author of the manifesto of the communist party wrote to his friend Karl Marx in London with some very promising news speculation railways is again reaching dazzling Heights since the first of January most shares have risen by 40% and the worst ones more than any this is promising clearly capitalism's then knew more was just around the corner the East India market was overstocked while the British cloth industry was being hit hard by a flood of cheap cotton inputs if the crash in the market coincides with such a gigantic crop things will be cheery indeed Peter ermine his business partner is already fouling his breeches at the very thought of it and the little tree frog is a pretty good barometer bankruptcies were picking up in London and Liverpool overproduction was glut in the market and Engels was adamant that the end of capitalism was nigh instead it wasn't to be exports urged wages rose standards of living improved and the mid Victorian boom ground inexplicably on in 1857 Angles optimism returned as the markets faltered the American crashes superheroes and not yet over by a long chalk now we have a chance the conditions for revolution were once again right with a capitalist mode of production and collapse the working class would surely rise to the occasion but two months into the crash the proletariat had still yet to realize its historic calling there are as yet few signs of revolution angles noted gloomily for the long period of prosperity has been fearfully demoralizing so you will appreciate friends that there is something of a prehistory to this evening's debate indeed my old friends Marx and Engels have been predicting the end of capitalism for over 150 years and now our opponents are suggesting that the immediate failure of such predictions invalidates our claim that Karl Marx is right and we would suggest quite the country to argue this in the wake of cash machines crashing in Cyprus over sixty billion pounds spent on bailing out British banks and the repercussions of the global financial crash still making their way through eviscerated social fabric of so many Western societies well I put it to you it is positively perverse as Terry Eagleton has written in the light of the continuing global financial crisis to claim that Marxism was finished was rather like claiming that firefighting was out of date because arsonists were growing more crafty and resourceful than ever I would like to suggest you that Marx has rarely seemed more relevant Marxist top researchers on 150-year tip was how the New York Times the New York Times marked 150th anniversary of the publication of the communist manifesto a text which more than any other as they put it recognized the unstoppable wealth creating power of capitalism predicted it would conquer the world and warned that this inevitable globalization of national economies and cultures would have divisive and painful consequences and the times was right ladies gentleman Karl Marx and Friedrich Engels were the first to chart the uncompromising unrelenting compulsively iconoclastic nature of capitalism it is pitilessly torn asunder the motley feudal ties that bound man to his natural superiors and is left remaining no other nexus between man and man their naked self interests then callous cash payments it has drowned the most heavenly ecstasy's of religious fervor of chivalrous enthusiasm of Philistine sentimentalism in the icy water of egotistical calculation and it was Marx who revealed how capitalism would crush languages cultures traditions even nations in its wake in one word it creates a world after its own image he wrote long before globalization became a byword for Americanized and marks was also clear about the social consequences the growing divisions between the lifestyles of the rich and the poor under unregulated capitalism what Benjamin Disraeli and Ed Miliband would call the two nations and in Britain we have seen this problem with the emergence of the so called squeeze middle and the diagnosis is right our current models of capitalism are not working the wealth generated by the growth prior to 2008 simply did not trickle down to ordinary people living standards began to stagnate from as early as 2003 and won't even return to that until well after 2015 and as for the growing extremes at the top and the bottom we'll just take a look at last week's fascinating great British class survey with its account of the precariat an update of Marx and Engels is proletariat and the elite as Professor Mike savage of the London School of Economics puts it it is striking that we've been able to discern a distinctive elite whose sheer economic advantage sets it apart from the other classes at the opposite extreme we have discerned the existence of a sizable group which is marked by the lack of any significant amount of economic cultural or social capital these are the two nations the recognition of the existence of this group along with the elite is a powerful reminder that our conventional approaches to class have hindered our recognition of these two extremes which occupy a distinctive place in British society who can tell us now that Karl Marx was wrong so let us get to the crux of the matter the 2008 crash and it's lingering aftermath revealed the failure of the theology of the uncontrolled global free market that is what we're arguing about that is what capitalism is about and all Marx and Engels is warning over the dangers of manat capitalism and concentrated finance have come to pass so why then no total collapse of capitalism because right around the world governments have been forced to bail out the so-called free market we've bailed out the banks we have subsidized industries we sorted out the insurance sector we've underpinned financial services we've kept the whole system afloat from car scrappage schemes to AIG to nationalizing Fannie and Freddie Mae it is the forces of collectivism which have saved capitalism the level of public support the extent of state involvement how we all in this room bear the heavy burden of H+ Lloyd's RBS and Northern Rock how we have taxpayers underwrite every major transaction now across the City of London how moral hazard has effectively been liquidated in the contemporary economy the very continuance of capitalism under current conditions is proof that Karl Marx was right capitalism has once again crumbled under the weight of its own internal contradictions and it is the state in America in Cyprus in China in India in the UK which is once again saved it the facade of normality is vindication of the crisis and why you can have no hesitation in supporting this motion tonight although I do fear that Marx and Engels rather than being delighted with the current turn of events are themselves probably feeling fearfully demoralized thank Thank You Tristram and our first speaker against the motion is George Magnus George is an economist commentator and author he has a long record as an economist in the financial services industry most recently as chief economist and senior economic advisor at UBS for 15 years till recently he now works as an independent consultant George your time starts now Thank You Oliver and good evening ladies and gentlemen in the wilds of North London where I live near Highgate Cemetery is a grave and a tombstone of the wily old political economist who's the subject of tonight's debate many of you may have been there to pay homage or simply to visit and reflect but the revival of interest in car marks since the financial crisis and the reason he's here in spirit this evening is because we're suffering as I'm sure you know an attack of deep economic pessimism you'll also know very well that our fixation with this pessimism and crisis and capitalism is not unique for example John Maynard Keynes wrote about this in 1930 in a tract called the economic consequences for our grandchildren in which he said it is common to hear people say that the epoch of enormous economic progress is over and that a decline in prosperity is more likely than an improvement in the decade ahead of us eerily familiar words but my view is that Keynes's dismissal of the pessimism of his own time has relevance today and I'd like to argue two points first that the whole point about the contradictions of capitalism is not specifically whether Marx is or Marx's analysis is relevant which personally I think in many ways it is but it's the outcome it's the synthesis and our capacity to basically nurture and establish coping mechanisms and the second point is that the main threats to our economic and social model today come actually from two sources that didn't even exist until quite recently and are neither the direct outcome of capitalism nor terminal so the first point on Marx's tombstone as you'll know if you've been there there's an inscription taken from the theses on Feuerbach which says the philosophers have only interpreted the world in various ways the point however is to change it which is precisely what our antecedents have done by developing coping mechanisms like institutions of the rule of law limited liability companies trades union mutual societies insurance welfare and technological discoveries that drive productivity income and jobs finding those coping mechanisms is an endless task and we need to make more progress on at least three of them the first is that we can't obviously keep shifting income from the owners of labor to the owners of capital without experiencing income inequality impoverishment of workers relatively if not absolutely excess capacity and unemployment the stronger investment that we had in the 1990s and the 2000s has of course given way to a bust real wages have been stagnant or declining in this country the median real wage has fallen by about 9% since 2009 back to levels last seen in 2003 and the labor compensation share of national income has fallen profit share has risen by about five to ten percentage points in most rich countries the second point is that finance or second contradiction if you what is that finance has been an enabler of innovation and growth but as articulated plently by the economists Hyman Minsky thirty years ago it's also an in dead in dodging a source of systemic instability I'm sure this doesn't need to go into any further explanation here except to say that as the raconteur and economist and diplomat JK Galbraith once quipped about recurring bouts of speculation and euphoria from Rome onwards every generation basically suffers from a Bravo T of financial memory and every generation makes the specious association between the ownership of money and the possession of intelligence bankers pay and the wider issue of management ryu narrating remuneration of course are rarely out of the headlines and an obvious grappling iron for capitalism's critics but the problem is that rent gouging or rent seeking as it's more politely known is the result of eminently fixable market and corporate governance flaws we could for example break up the banks as the Vickers Commission has urged we could ban or restrict the use of stock options and other tools that tie remuneration to short-term stock market performance there's nothing specifically systemic about not being able to fix these problems if we really want the third point I've just quickly mentioned is the need to cope better with globalization capitalism's propensity to globalize has generally been a force for the good I'd submit but the blowback in the form of the growing economic significance of China and other major emerging markets is a big problem integrating in their own ways Western capitalism's best practices from markets to modernity and from meritocracy to the rule of law these countries are no longer just consumers of Western capitalism's goods and services and in some respects clones but also very powerful competitors and rivals big big contradiction issues without a doubt but my point is that even if our existing political leaders suffer from up from myopia and something that I like to call deficit attention disorder thank you the capitalist the capitalist model has been and remains adaptable now the two points I mentioned earlier which are relatively recent are 21st century aging and technology which actually have in some respects the flimsiest flimsiest of links to capitalism and our questionably though big issues for example in the first case weak fertility and rising life expectancy are driving a unique and relentless rise in the age structure of our societies never seen before and it's challenging us to redefine the social rights and obligations of citizens versus the state it's a very complex issue to get over particularly at a time like this and the thing about technology in automation is that they are also displacing white-collar including skilled jobs from retail to radiology and from clerical to even legal positions and I think this explains partly the predominance of low-income part-time jobs in countries that Eaton have raised employment since 2009 modern technology is equally an issue for emerging countries for example in China the Taiwanese company Foxconn who has you know manufacture for Apple Sony and lots of others in China has started to substitute robots for workers their plan is to substitute 1 million by 2015 automation and robots are generating very strong demand for labor at the top of the occupational structure and the bottom leaving as my opponent Tristram said before those with average levels of human capital and skill in the middle very vulnerable and dragging income inequality higher we don't really know how we're going to solve this problem in the long run but capitalism still has very persuasive credentials let me give you two little anecdotes first Henry Ford and a prominent labor leader supposedly once teased each other about factory robots not being able to pay union dues or buy motor cars Henry just simply retorted though that he was going to pay his workers twice the going rate which he did which underscores a process in capitalism that runs from productivity to higher wages and lower prices rising demand and jobs and so on there's also a story about Milton Friedman visiting a Chinese construct project and asking his host why workers were using so many shovels and so few machines told that this was a job creation project Friedman said in that case why don't you give them spoons the point of course is that capital including human capital makes people more productive and societies better off and my hunch is that in time the revolution going on in advanced manufacturing in energy sector and new technology will deliver significant benefits so in conclusion mr. chairman our opponents may argue that capitalism itself is the systemic problem behind our pessimism and that markets don't work that a radical redrawing of the boundaries between the state and the private sector is necessary personally I don't think anyone thinks that Lace a fair is the answer but we should be careful what we wish for the influential Chinese magazine Kushina warned the country's leaders recently that the heavy stand of the heavy hand of the state was stifling competition distorting resource allocation and encouraging corruption and red seeking and social fragmentation China's leaders have the courage and will to implement difficult reforms in the next five to ten years Chinese capitalism will move our way if they don't we shall see ladies and gentlemen finally our predicament I would submit is not the sound of capitalists and falling apart but a painful period of adjustment from one economic and technological period to another thank thank you George our second speaker for the motion is Robin Blackburn Robin is leaving furlough at the University of Essex he's a former editor of the new left review where he's written on the collapse of Soviet Communism and the credit crunch of 2008 Robin your time starts now thank you yes Marx was right if you study our motion you'll see that where we aren't arguing he was right about everything simply about the contradictions of capitalism what did Marx mean by contradictions let's look at some examples Marx urged that capitalism by generating wealth that one pole and poverty at another destroyed its own momentum those who are badly paid or unemployed couldn't be good customers in recent decades growing inequality undermined accumulation but the financial wizards had a fix wall street in the city having failed to nourish their own domestic economies instead came up with a brilliant idea of becoming loan sharks lending to the poor at high interest rates and then bundling these debts into supposedly failsafe financial products but extravagant inequalities eventually took their toll US subprime borrowers the poor devoted defaulted in droves while tens of millions of underpaid Chinese workers couldn't buy much from the West or anyone else these hard facts punctured the Delirium of investors pulled the rug from underneath the big banks and brought on the global downturn but here's the good news working people in China have protested at miserable pay recent worker militancy in China has raised wages which had be good for global recovery if only the other governments were doing the heavy lifting to boost global demand but there's no sign of concerted measures of debt forgiveness public investment to reignite growth this leads us to another contradiction namely even as the different parts of the capitalist world become more interdependent they each resort to begun my neighbor policies the IMF and World Bank should boost lending to producers but instead they tolerate competitive austerity and urge all countries to strive for an export surplus as if this wasn't a mathematical impossibility it would be more rational to lend money to the man in the moon and then let him purchase any unsold inventory that might sound ridiculous but scarcely less so than the world of QE or quantitative easing now practiced by the world's most powerful central banks QE sounds a little queasy a coded reference to financial bowel movements but it's nearly really no more than printing money and then putting it the way of banking folk next item in the repertoire of desperate expedience is helicopter cash as the financial explained times explained last Friday this involves I kid you not simply sharing the population with great wads of notes as if dropped from helicopters but somehow the giveaways all land on the financial districts if the financial authorities had the courage of their convictions they instead pay out fifty thousand pounds to every citizen with the proviso that they must pay down debt or spend the money this would really get the economy moving but we all know it won't happen it's too sensible so here's another perversity of capitalism it's official custodians resort to give away as far bigger and far less justified than the welfare states they demonize official bailouts represent socialism for bankers welfare for billionaires down on their luck I should reiterate once again didn't get everything right the workers haven't revolted in the way he thought likely he didn't anticipate global warming or the world wide web or reality TV and he was probably wrong about the declining rate of profit but he did wrestle with the madcap logic of what he called fictitious capital there'll be some here tonight who've heard enough nice things about Margaret Thatcher in the last 24 hours to last them a lifetime forgive me therefore for pointing out that wild Karl Marx and Margaret Thatcher differed about almost everything they agreed on the importance of capitalism many founders of economics and social science analyzed the dynamic of industrial society or commercial Society or modernity Marx coined this concept of a capitalist mode of production he saw capital accumulation as the juggernaut of the age a 19th century thinker Marx saw rampant capitalism leading to a world of pervasive and unstable commodification this was a world in which everything must be for sale and have its price a world in which everyone has to become a two-leg profit and loss center and everyone is urged to take on debt to buy exotic insurance products and to do their duty as insatiable consumers on Saturdays Radio 4's radio for money box someone explained that enterprising banks have persuaded customers to insure against automobile theft even when they don't actually own a car marx held that the world of capital was anarchic that it had no regulatory center notwithstanding the IMF and World Bank this is still true when it comes to bailouts the international organizations only have the resources that rich countries allow them to have they don't have a fiscal base of their own the uncovered world of international money is constantly prone to speculation and crisis because crisis is its only way of wiping slates clean and starting afresh and money is sovereign because the world's great powers allow themselves to be pushed around by Bermuda and the Cayman Islands or perhaps something else is going on maybe it's some other organizations who are pushing us all around the United States with its boundless faith in capitalism is also the country why in October 2008 the Treasury secretary opted to take out huge tanks stakes in the big banks the US administration also nationalized to global Titans General Motors and AIG though they didn't go nearly far enough these measures worth for a time quite effective indeed in a contradiction Marx would have pounced on the more successful types of capitalism borrow great doses of state intervention coordination and public entrepreneurship it's the laggards and dunces who parrot the witless slogan that governments can't pick winners in Taiwan with its hugely successful science parks or Brazil with its world-beating agricultural exports they laugh at such idiocy and then think of Communist China with its state banks doing more to resuscitate global demand than have Western governments the international markets prop up our propped up by China's Politburo there's a palpable contradiction of capitalism this time one that cuts both ways I agree here in Britain successive governments have no faith in the British people despite their outstanding record of innovation instead of endowing a string of public regional funds with the resources to get small and medium business investing again they channel the cash to zombie banks whose only pathetic thought is to join their horns D leverage and reduce exposure having lost a bundle betting on moonshine they now refuse to invest in real research centers Mark's wanted to go beyond capitalism but he didn't reject modernity in fact the word contradiction is borrowed from Hegel's dialectical philosophy and as applied to capitalism implied that there could be virtue in the market mechanism so long as it's rescued from the greed of capitalists and the blinkered dogma of neoliberalism's high priests thank Thank You Robin our second speaker against the motion is Madison Perry Manson is president and founder of the Adam Smith Institute the free market think-tank that's in your time starts now okay well like many public figures who leave a legacy either in their writings or their deeds Karl Marx was sometimes right and sometimes wrong everyone is boring Edward Heath I'm going to concentrate on some of the things Marx was wrong about because they're relevant to the motion and also it's actually more fun he was wrong to predict that history would take us to the inevitable triumph of the proletariat and then stop history shows no signs of doing either Marx is also wrong to suggest that this could happen first in the most advanced economies as they reach the final stage of capitalism in fact such revolutions as took place came in less developed countries less developed economies such as Russia and China it has not happened in the advanced economies and this could be because Marx was wrong about something else he predicted that capitalism would drive down wages to survival level before its final day knew more but in fact as economies became more advanced both wages and living standards rose to levels not even dreamt of in Marx's day and this seems to have lowered somewhat the pressure for revolutionary violence and change Marx was also wrong about something very much more fundamental he was wrong about change and I don't just mean he was wrong about the changes that would come about more fundamentally he was wrong about how change takes place he took the Hegelian model of change now to the philosopher Hegel change comes about in staccato triangles a state of affairs nurtures its opposite and from the violent clash between them a new state of affairs emerges thesis antithesis synthesis violence at the very core of it and hence Marx's commitment to revolution the folly is that Marx was a contemporary of Darwin he'd read Darwin's Origin of Species he actually admired Darwin's account of the origins of human kind he failed however to spot the significance of Darwin's theory of change and to incorporate it into his own program Darwin advanced a gradual mechanism of change in which small differences gradually come to dominate over time it is evolutionary not revolutionary and it's a much more accurate description of how change usually happens in human societies much more accurate than was Hegel's account indeed Darwin was right and Hegel was wrong this of course means that Marx was also wrong wrong about change and wrong about how capitalism would develop the point is that capitalism changes and evolves it has been through many transformations the capitalism that Marx thought would collapse under its own contradictions is not the capitalism of today the one that the motion refers to in the material world organisms evolve they respond to crises and they change a similar thing happens with our social practices they evolve and adapt to new circumstances capitalism has faced many crises each time it has evolved and changed each time a new form of capitalism has emerged to solve the problems its predecessor faced this is how human beings progress we solve our problems by adapting our practices yes capitalism certainly faced a crisis in 2008 but is still with us and as yet on collapsed its evolving and responding to the changes that are needed and as before when the dust of crisis has settled it will be a new version of capitalism that goes on to generate more wealth and to expand the opportunities open to humankind the new version of capitalism that emerges will have to be won somehow manages to keep it arm's length the politicians wanting to fix its outcomes for political advantage greedy bankers can only take reckless if politicians make it cheap for them to do so by turning on the taps of credit and money politicians like booms and bubbles because they help them to win elections and therefore office and so capitalism must now find procedures to limit their ability to do this those whose greed is for power are no less deadly than those whose greed is for gain and both need rules to circumscribe their scope for action I wish to make a further point that capitalism will survive because it is the only valid way we found that works in practice to create wealth and all of the opportunities that come in its wake Marx was wrong about another important thing he subscribed to the Labour theory of value he believed that the value of the thing arises from the labor put into producing it hence surplus value exploitation charging people more than the cost labor cost of producing it exploiting the workers wrong value is based on demand if no one wants a thing then no matter how much labor went into producing it it is literally valueless it has to be demand based we all value things differently and that is the only reason trade takes place we trade because we heat you value we put a greater value on the thing that the other person has than what we're offering in exchange and when we trade we both gain something more valuable than we had it's a win-win situation and it creates wealth we produce in order to trash and create wealth and we invest in order to produce that is in essence what capitalism is and it works it certainly works better than anything else that's been tried and it works more humanely than anything else that's been tried yes capitalism grows more complicated and more ambitious as it evolved but its principle to remain capitalism will survive its current crisis it will be tweaked and modified but it will not collapse because nothing has ever been found that can replace it all do what it does or bring the advantage in the benefits it brings it has brought more to human achievement than any other institution devised by humankind it created wealth and on unprecedented scale its enabled us to conquer disease to conquer poverty malnutrition starvation disease it's enabled us to fund arts cultural activity education social services capitalism is the most benign thing people I've ever done and that is why this motion cumbersome ambitious as it is is also misconceived and why I urge everyone to vote against it Thank You Matson our third and last speaker for the motion that Karl Marx was right capitalism post 2008 is falling apart under the weight of its own contradictions is Frank for a day Frank is professor of sociology at the University of Kent his forthcoming book is entitled moral Crusades in an age of mistrust the Jimmy Savile scandal Frank your time starts now good evening comrades and and those of you that still believe that the earth is flat as well I think that if you look at Karl Marx and you look at his writings on a wide variety of subjects you'll find that he had a very simple interpretation of capitalism a very compelling one and he basically said that on paper in theory capitalism is a wonderful idea it's a really brilliant idea free trade free markets individualism individual self development sounds really brilliant said in theory capsules was wonderful idea the only trouble is is that doesn't work in practice that's the only problem it doesn't really work in practice and one of the things that we find with capitalism especially as it becomes more and more mature is there's almost a a desperate attempt to recast capitalism in a way that is almost a caricature of itself very often when you hear stories of that Capitals say about their system you almost imagine that they've been reading Harry Potter and they're just dying to write yet a lot of volume but this time you know sort of with a a capitalist happy ending and the stories that you read in the newspapers are really very interesting I don't know if you picked up this story a couple of weeks ago which would have really amused Karl Marx was very small story was really about the fact that our government in its wisdom has decided to privatize search-and-rescue operations basically we now have a free market in search and rescue it means that for example if you stranded on Mountain you know sort of in in Scotland then you got a choice of which company which company is going to come and rescue you which basically in practice means that on the one hand year one company that's fronted by Prince Harry you know you can have that brand as the guy that kind of does the business or alternatively maybe Prince Andrew will front the other organization that will do this and what you find is that competition and the free market is increasingly recast in this very silly you know sort of kind of play-acting form where everybody knows the dirty secret which is that you know when it comes to reality everything has been sewn up sort of behind the scenes and basically privatization in these circumstances is really not so much about the market but about a state handout to a particular company it is really the welfare state for the capitalists it's their kind of dependency culture that they often sort of kind of go on about Marxist theory of crisis is based on a simple idea it's by the way it's a theory of crisis that he actually shared with a lot of people who weren't even Marxist who were often friends of capitalism and if you read David Ricardo if you read some of the writings of system only the SIS Mundi if you read even some what I Joseph Schumpeter in the twentieth century they all understood that capitalism has got on any here in tendency towards this integration and towards collapse that the proposition is very simple capitalism has a tendency to destroy the very foundation on which it's built if you look at the way that capitalism develops it cannot tolerate a genuine free market capitalism destroys the values the traditions the religions on which it was founded capitalism cannot live with communities the communities that gave rise in Scotland the Scottish political economy are inconsistent with what goes on before and then therefore virtually everything virtually everything that gave rise to capitalism it's very foundation gradually gets unravel old to the process of accumulation and therefore what we find is that with the passing of time capitalism cannot continue to accumulate on its own basis it reaches its limits you see what Marx was really objecting to wasn't inequality and that's the way it's often interpreted wasn't a fact that some people were poor or some people were rich basically his argument was very simple was that capitalism cannot systematically deliver the goods cannot since this Matthew provide the living conditions that we need for a civilized society it's also another point Marx points out to the destructive consequences that are contained within capitals and the tendencies towards this integration towards collapse it makes the point that as capitalism becomes more and more mature it loses vitality it can no longer simply rely on individual capitalists to compete and raise productivity and increase production it makes the point that as the falling as profit rates fall increasingly capitalism destroys its own defenses and is forced to look for new institutional solutions to keep on going it's what George called the coping mechanisms continually looks for different coping mechanisms to go on and what he argues is at a certain point this is the decisive inside the sociological insight that Marx provides at a certain point capitalism is forced to seek refuge in institutions and in customs that actually contradicts its very nature and that's what we saw with the search and rescue operation it actually is forced to find refuge in institutions that have got nothing to do with the inner workings of capitalism it emerges by the end of the 19th century we find that free competition gives way to monopolies an organized form of competition because you simply cannot tolerate real people genuinely competing so you've got this big massive kind of monopolies that carve up the market you have a situation where it's not the labor party it's not the left it's not the Socialists it's the capitalist themselves that go back the state to intervene and state intervention becomes the way of life of modern capitalism in fact the capitalist class is so addicted the state intervention that it simply cannot do it at it I don't know if you realize but even in Britain today we got this so-called neoliberal government when neoliberalism comes from all that I know is that in Britain in British society the state accounts for something like almost half of GDP anything between 45 to 47 percent of GDP is actually a sort of carried out through state expenditure and if you find even in neoliberal United States the state is a very active role in propping of capitalism in all the key areas all the important domains so we have live credit I mean Robin talked eloquently about quantitative easing you know where is the free market there you basically got these guys sitting around in the Bank of England and say how much how much should we give to these people how big a handout does capitalism need today you know let's ease their life and you kind of you know sort of circulate all this money where's the company where the free market where is the basic logic of classical capitalism in this and in a sense what we find is that capitalism under these circumstances can only continue by destroying its very foundation at a certain point you cannot simply increase state intervention I mean Cameron is right if the state increased expenditure we have a massive disaster it's reaches limits you cannot just simply you know sort of throw more money at the problem at a certain point you have what some of our Joseph Schumpeter was a friend of capitalism called disgust created destructive creation and it was this destructive creation that allows capitalism to periodically survive my argument is is that rather than you sympathize term of destructive creation we all get on the strand that of creative destruction we have to understand that the key challenge that faces us in the 21st century is not to sort of look and pretend that there is no problem understand how we manage the destruction that our societies are experiencing and will continue to experience there's no doubt that the capitalist system will need to restructure itself in a very fundamental way and the only way that they can do that is if it arose the existing institutional framework within which it's based so the question becomes do we manage that destruction in a way that doesn't benefit the mass of society but only a small section of it or do we have a grown up discussion a serious grown-up discussion which genuinely attempts to manage that destructive way in a sense they will have a progressive outcome thank you thank you Frank our third and last speaker against the motion is Judith Shapiro Judith is a former revolutionary Marxist she was previously part of the team headed by Jeffrey Sachs advising the Russian Ministry of Finance in Moscow in 93 94 she's currently a tutor in economics at the London School of Economics Judith your time starts now thank you I have three basic propositions to put you against the motion first of all capitalism is not collapsing let's have a reality check if we simply look around the hall at this packed auditorium of the vibrant middle classes who are engaged in the Royal Geographical Society which in Marx's day was an elite dinner club and now has 10,000 fellows who belong to that middle class and if we think about the fact that there are grave threats to our welfare but that this is very different both from the 1930s if you are of my age you have parents who told you over and over about that it is both very different from that and very different from a system that I did see collapsing the Soviet Union which did fall apart of its own contradictions some people may try to explain that that was capitalism but some people will try to explain anything so the the point is that instead of the system collapsing of its own contradictions it is as the speakers who said they were for the motion have said it is finding ways which are not strictly free-market to keep itself going and the notion of capitalism as a model which can only be a market is a model in our minds it is not a reality capitalism as a word is our model of modern society the second point is as I've said that it is indeed a grave crisis this is not just another crisis it is not like the oil shocks it is not like the dot-com bubble it is not like the 1997 Asian crisis this is a more or less epochal crisis in the sense that we have to resolve it in a very serious way in which we change the way that modern society works and what we're doing right now is arguing about who is going to pay for the debt that has been run up or in complicated terms deleveraging and what I want to put to you as the most single important point I would like you to take away tonight is that whatever is decided in the technicalities and some of my students have written in a little blue booklet that you have most of you about these technicalities however we do it what we have to do is start reversing the inverse burden law as I see it forming in which the people most responsible for the crisis are bearing the least burden and those least responsible because they're not being exploited in the marxist sense they're outside the system they are paying the most and that is really looking at what can happen with that it's a very fairly simple story of what happened when we had that sort of debt as a result both of the 30s and of World War two that we had moderate and mild inflation and we had other means that go by the slightly frightening term financial repression which is a term many of you may not know but trust me you will and it will no longer seem a technical term particularly if you figured out what credit default swaps are and how they differ from other sorts of initials you've had to learn so and the euro is a separate question that I leave aside here because it was not economics in command but politics that gave the mistaken decision to have a single currency for an area that can't hold it and how you unscramble that omelette is a separate question about which I think there are intelligence squared debate the third proposition the final one is that there is nothing whatsoever in Marxist economics that helps you to understand it some of the finest writing on the financial crisis I know is Robbins in new left review starting in fact in 2006 with a wonderful article well before it was happening but I have noticed I have not calculated it statistically but we could put a student to work at this that calling yourselves a Marxist or not a Marxist gave you no particular advantage in foreseeing it Robin did not see I'm sure he would agree the depth of it in fact Nouriel Roubini who is definitely not a Marxist did not because he's brilliant not because of his analysis he may be both of them may be correct but because he lived in lives in New York City and likes to have parties where bankers came and he found out to his fright what was happening there is another book I recommend by someone who's never done that sort of partying but he or he has but in other people's money a Nick Dunbar who was a physicist and who's written a very wonderful very easily readable book if you can't stand books that don't have much economic analysis and have no graphs and no equations these make me edgy but they may make you happy it's called The Devil's derivatives each to his taste and the point is that as Robin himself said I think it was Robin the falling rate of profit is probably wrong Frank Feraud he basically made fun of all Marxism and Tristram hunt as a member of the Labour Party and an MP really doesn't want to get up and say that he believes Marxism is right he is having a very good debating style which he can do well and enjoying himself as I hope you are too but none of these people are Marxist none of them believe that none of them believe that capitalism is collapsing and to vote that way just to scare the idiots who are not doing policy right is a mistake that's why Nouriel Roubini first said Marx was right he was fed up the way that I don't know about you but I felt when I saw what was happening about Cyprus we nearly had a second Lehman Brothers and everybody was doing their own thing and all over the map and it was terrifying but then they did actually get some cold water dashed on them and they did the right thing they may not and that is why we need education we need to know what we're doing so that we ourselves can take more of a role because another thing apart from the growth of the middle classes so that you have not been ground down but the reverse and all over the world this is happening including in China that it is the the educated middle classes in Shanghai and in a city where they did not want a a poisonous cancer Factory this is what I think is the forward march in China and it will be also in Russia it will be the educated middle classes there and that is what we should not feel sorry about Tristram hunt I was disappointed to see his article in the FT yesterday I hope it was just a mood piece because I'm sure he was asked because he is the finest chronicler of the middle classes so I have had a joke before in january/february that I have five opponents you know that I don't agree with Madison for example on laissez-faire but actually there are five people six people counting me on this panel who have argued to you to support this to oppose this motion and that's what I'm asking you to do to see the sense behind the rhetoric and the good jokes and to choose both common sense and reality so that we can go forward and we can find a solution where the burdens are as little as possible it will be unpleasant but it will not be hell if we do it right thank you very much Thank You Judith ladies and gentlemen you've heard six lucid expositions we're now going to move on to questions I'd invite you to give questions or contributions as briefly in succinct way as you can but before we do that I have the results of the initial poll the question you were asked as you came into the Hall to remind you the motion in front of you is Karl Marx was right capitalism post 2008 is falling apart under the weight of its own contradictions the result so far is very evenly balanced for the motion there are two hundred and three votes against the motion there are two hundred and fourteen and don't knows number 197 so it's roughly a third a third a third and there is everything to play for will now turn will now turn to questions and the first question is from me I'm going to ask very briefly if you would ladies and gentlemen ladies and gentlemen if you would each take a question from me first the proposes of the motion gentlemen George referred to finance as an endogenous source of systemic instability and he added that with an audience like this he didn't need to elucidate the concept is he not running that your analysis of the inherent contradictions of capitalism is geared specifically to something that is outside the system it's the the failures of of Finance capital any of you perhaps you'd like to respond to that well I think on the contrary I think that what happens in the financial domain is a reflection of the fundamental contradiction that takes place within the process of production I think that the key that the most significant development over the last 40 or 50 years has not been the securitization of economic life I think that's bad enough it's been the inability of capitalism to maintain rising productivity rises in innovation it's its inner tendency toward stagnation in the production process which is the central core of the capitalist system that's at issue the financial system merely reflects that because the problems of production are displaced in through the credit mechanism in a financial system and I think that it was only finance that we have a problem but precisely because the productivity Rises has been pretty stagnant to the 1960s I think all of you would agree on that and that needs to be explained how can a vibrant system fail to maintain the momentum that it achieved in the past okay sir please welcome I want to pitch in just quickly that I think really finance is too important to valuable to be left in private ownership and run on commercial lines so really the essential point is of course we can avoid this collapse that's going on but the way to do it would be to socialize finance and to have not just one of course but a variety a considerable variety of publicly owned responsible accountable institutions funds and financial institutions ok the the opponents of the motion Robin referred in his speech to the madcap logic of fictitious capital are you not making too big an exception in your exposition of the resilience of capitalism if you leave that out any of you the point is that that Marx had the strange fictitious capital but it's not at the center of his analysis unfortunately those people who have not read Marx cannot today understand who's right about what Marx meant if you want to try to do it I have written some notes on where you can look me it gave me a headache Sunday to go back to that stuff because Marx did not finish what he was writing on the falling rate of profit Robin could even say Marx was right because Marx didn't published chapter 13 of volume 3 angles did it took him 11 years going over Marx's notes to make sense of it and it should have been like what we do in conferences it should have had on the front this is a preliminary draft please do not read without do not cite without the author's consent PS authors residents Highgate Cemetery so but angles didn't do that he felt his debt to Marx to finish it and it is not coherent it does not hang together and it is not science as I understand it because science as I understand it has testable hypotheses and it is instead ideology it may be good so that that's my view on fictitious capital was one idea that you can pluck and then you can talk about it but it's not at the center the productivity is but productivity is I love the idea of people being able to put on the Internet of what Trotsky said mankind's productive forces stagnate and then send it out posted to the web have it on their iPad and say we haven't had any growth capitalism is stagnating I've read it myself today online and I put it up on my blog George quickly and then Tristram quickly we go to go to the audience well ok then quickly so I think that if you look around the world and you know historical development I mean our technological achievements there I mean there is a problem with productivity it's quite you know it's quite cyclical but I mean they're the standards of living that we as we have achieved and that other people all over the world aspire to I mean are real and they are brought about as a consequence of investment and of you know the development of coping mechanism finance is a problem and you know I mean my understanding of Marx you know that there isn't a huge amount of financing Marx but he was quite you know critical of what he called the subordination of industrial capital to finance capital it's basically what the contemporary economic debate is about you know banks doing all sorts of stupid things with derivatives and there should be only to SMEs and so on so forth as nobody would disagree with that and I think unfortunately it is a problem as I indicated before that Galbraith you know quite correctly quipped which is that every generation does it we all think we're cleverer than our parents and our grandparents we always make the same mistakes but we carry on and that's life Tristram Judith is right to take us back to to the language of Marx and what Marx assumed that he was himself writing about and when Marx wrote about capitalism he wrote about the kind of capitalism which angles was working in in Manchester in the 1850s and 1860s and this was red in tooth and claw lace a fair Nightwatchman state free-market capitalism that is the capitalism which is under discussion this evening what we have this evening and what we have at the moment in terms of our currency could not economic models would from Marx and Engels as perspective be a form of collectivism as Frank said when you've got the state operating at forty five forty seven percent of GDP this is not the kind of pure capitalism which Marx was critiquing so in Marx's own terms in Marx's own language the nature of capitalism the contradictory forces inherent in free-market capitalism on his own terms is the issue we should focus on this evil thank you Tristan questions or contributions from the floor I'll take three at once first the lady in the middle there then the gentleman there and there's a question right at the back we could if the ushers could take the microphones there but madam first I have a question for the speakers and speaking for the motion and so you say that capitalism is falling apart and but you haven't really responded to and Madison's argument that capitalism is the best system that we've got so what would you see as the alternative to capitalism I should have asked you to say your name first and if there is any Victoria Victoria's question any of you well I think that there is no doubt about the fact that capitalism is disintegrating and there's no doubt about the fact that Marx's analysis of this trend is absolutely correct but Marx had two theories he had a theory of collapse and he had a theory of change and his theory of change was that no system collapses by itself unless there is an alternative unless there are the social grouping prepared to offer a different world and I would argue that at the moment the big challenge that faces us is not to revel in the fact that capitalism is collapsing that we got these big problems that jutted outlined but to work out a way of how we can manage what is a very serious process of destruction that we're going to be faced with the next 10 15 years we haven't begun to see what this depression is really like and I think in the course of that we can begin to develop our alternatives I think the key thing is not to close our minds to the future we've got to stop living in the past I mean this is a discussion about 19th century thinkers but we really do need the 21st century equivalent or people who are future oriented and can begin to develop some kind of alternative sorry to questions once there's a gentleman here and a lady I think a lady right at the back please sit build already be really a question for all of you the I think there's almost unanimous agreement on the panel that there is systemic failures if not at the very least systemic problems and therefore the key question is how do you differentiate yourselves in terms of what is the agency that will address that systemic failure now Judith has told us that correct agency is to have cold water poured on you by an unelected bureaucracy in Brussels I was wondering what the other panelists thought the agency is and a question at the back carry Dingell from the education charity world writing citizen TV worldwide secret questions and firstly if do any of this if the speakers for or against the motion and do you believe in the idea of a cannon in which case and a new cannon for our times would you have marks on it and which of his writings might be on there and a second quick question today's and debates seem to be that happen in the public sphere seem to demonstrate and we've seen it here too that whether you consider yourself left or right or perhaps neither the state is the only solution state intervention or welfarism isn't there a better way to go taking up neither of those and what are your views on that okay I'll turn to the opponents of the motion first to that term that second contribution George what writings of Marx do you think should be on the Canon if any and any of you what is the what is the agency that you see as dealing with these remedying these problems well I the writings are very rich and there's some wonderful quotes but I would have to settle on the one that I put in my main presentation which is the bit about you know explaining the world and the point is to change it of course we've heard a lot of kind of political rhetoric and explanations about what has been what is what might be what should be what shouldn't be the point is what do we do about the situation which kind of addresses your question about the agency and your question as well about what would you do otherwise I mean there are clearly a lot of ways that in an emergency such as we're in at the moment where you know if the private sector actually can't do something because it's trying to behave in a certain way the government has to compensate so you know the insanity of what I've previously called this deficit tension disorder is the private sector is trying to say this design is what exactly should do because we actually run out too much debt and we you know were seduced into buying things that we shouldn't have been buying on tick and now we have to kind of change it so what kind of insanity is it for the government to try to save at the same time that the private sector is trying to save so I don't think this is a problem of capitalism I think this is a problem about political behavior and a lot of the things that I think we've heard from our opponents really are or is about but you know just chronic and asinine political behavior when we haven't even spoken about the eurozone yet but anyway and and that's really you know and that I don't think is a systemic problem so I think there are genuine things I mean I accept the point that you know that the the sort of 18th century capitalism is clearly you know a different ant beast from the kind of thing that we have today and the government does have a big role to play the state can facilitate change mutualization can also facilitate change too I mean we have a lot of proposals which are being looked at for example in the finance sector about how you can mutual eyes financial services and mutual and financial institutions for kind of limited purpose banking I mean not everybody's cup of tea but I think you know we could take these kinds of things quite seriously Roman Marx's writings on the Paris Commune certainly would deserve to be in that canon and they dispel the myth that he idolized the state and I really want to respond to the question which said is the only answer to the collapse the tendency to collapse of capitalism which is much graver in some parts of the world than others but it's a reality really globally is is there any way that that the state intervention that can be that is needed to stem that collapse is there any way in which that can be saved from bureaucrat ISM and a late ISM and all the other problems that two mighty states breed and I would argue that there's a an idea there in Marx that the state could be used to set up organizations social funds for example even cooperatives that just because they're set up by the state because they're publicly owned because they are accountable to some group that doesn't make them commercial it doesn't make them capitalist and so really what I was saying earlier it's it finances the source of dynamism of lism but it's failing us now so weary need to rejuvenate with a state that intervenes that sets up networks of regional funds that get people working again and I think that's desperately needed and certainly that should include small and medium business get them working too but the the financial level should be one of which democratic criteria should apply it doesn't mean the state should micro micromanage everything in fact the state should get out of a lot of things even that it does now but they shouldn't be dumb handed back to the failing capitalist model but rather to some new model based on public ownership and social cooperation Tristram he wants to come come in on this I just want to make a plea for angles rather Mark's angles are the condition of the working class in England is is a superb text and when I go and teach in schools at my constituency in stoke-on-trent I give them angles as account of going to Stoke in the early 1840s and seeing the skin peel off the fingers of children as they're dipping the Dalton and the Wedgwood we're into the chemicals which made such beautiful products in there in the Potteries and people are so skeptical about the role of a Health and Safety Executive after that I I would also just say that Robin is exactly right that Marx is great achievement was the historicize capitalism was to suggest that there are I there is that there is a history to it which obviously meant that there could be an end to it but there are other forms of wealth creation and when we look at the co-operative model the mutual model the Association is model even the family business model these are more interesting models of contemporaneous capitalism thanks Tristram other questions there's one right at the burka gentleman with glasses there is a gentleman right at the edge is there a lady with a question there one two three my question is sorry Mike Michael Seifert my question is based partly on what Robin said which is about Marty's writing about the Paris Commune because if you remember he said that men make their own history but they don't do so in conditions of their own choosing the weight of past generations weighs like an alt on the mind of the present generation and what he meant by that was that people can't just when they try to think they're trying to break free from the ideas that they've been heretic from previous generations they find themselves unable to do so and I'm unable to face it but my question based on that and based on Marx is historical breath which starts with primitive communism slavery just guess my question is do the parallel think that capitalism really is the highest form of social development for humankind ok second question there my name is eager I'm just independent person it's it's a question to to the members of the panel who are voting against the motion and I'd love to hear your views on the following do we even leave at least in this in Western Europe do we even leave in Western Europe under capitalism is it still capitalism can we call it capitalism with the welfare state NHS the state intervention and savings of banking systems out the industries etc etc where the state controls more than 50 percent in some countries like France probably 70% of GDP can we still call it capitalism that's my first question again we leave it at 1 because that well subsequently or now can we leave it at 1 please I do I do wish to be discourteous but there are other questions ok I have to explain the question right thanks very much third question there please thank you my name is Anne Cormac I'm red in tooth and claw capitalist but I have worked in my career in the private sector as well as the public sector my question to the panel is is it not social democracy that is rather failing us now in the sense that if you look back at the causes of the crash I would say it was actually the policies implemented by both Bill Clinton and also the previous prime minister in this country actually allowing people who were not capable of having the right assets to be able to support borrowing to go beyond what was feasible and realistic and sensible for them to borrow in those political moves lay the seeds of the financial crash that have actually happened and actually what we're seeing around the place is a is a broken social democratic model rather than broken capitalism thanks very much I'll turn to the opponents of the motion first whichever of you wants to deal with those three quite linked questions is capitalism the highest form of Social Development is it in Western Europe indeed still capitalism and is it not social democracy rather than capitalism that's failing Judith they are linked I think first of all what do I think personally I think my other panelists might disagree is capitalism the highest form I hope not but first of all we will need to be in a situation where basically we have abolished scarcity until we have that as Trotsky brilliantly put it in the revolution betrayed when you have shortages queues form then a policeman is called to keep order he never fails to help himself first so and I I think that I ignored the problem when I chose to leap into Marxism I knew already as a PhD in economics who really believed in it also that scarce he was not going to be abolished easily and with the new things we have seen that Frank Ferrari thinks haven't happened the productivity gains we have so many more things we want all over the world and we are not of course we could want less I am happy I no longer want plastic bags and I'm perfectly willing to have a cloth bag I carry around and doesn't have to have a label now but the point is that we can want somewhat less and maybe that's one of the things we will get out of this long period of deleveraging that we will learn to live with less and with more leisure which we didn't learn to do and we will have there are some positive sides to it but it will be not in our lifetimes and I don't think in your children's lifetimes not even the youngest people in the room but someday I hope that many things will be again as Trotsky said like a well-mannered boardinghouse but I personally as somebody who tends at a well-known boarding house to take the eggs I like first I have to be careful and think yes first there have to be enough eggs for everybody and that's the I don't want my answer to the other is do we even live under capitalism that is a definitional question and I don't think that it is relevant unless you are a Marxist I want to know if I want to know if it's good or not first then we can work out what it is and again social democracy no I think social democracy has to decide what it's doing that one of the problems was that what I call social democracy and when I came to next decided instead to buy into the bubble and the boom and it needs to find its way back and I hope that people like Tristram will be part of that because they went from the right of me to the left of me to the right of me in a whizz and many of you others may have felt that I think there is a role for government in the banks for example I don't think I'll stop okay thanks to Frank yes I think that you can blame social democracy for many many bad things but not for causing the problems because the interesting thing is that no matter what the government is whether it's a Reagan led government or a Christian Democratic led government in Germany or a social democratic government in France or in England we see a similar pattern of relying more and more on the credit mechanism with see a situation where on the Reagan and Thatcher you had the securitization of the credit system on the Reagan in the earlier period you have actually an increase in state expenditure for a certain Imperial time but still expenditure not necessarily for welfare payments but for armaments and for other areas so I think it's important to realize that there is no government in the Western capitalist world that didn't buy into this policy whose consequences we're not paying for I haven't sort of come across any of that in the 70s and the 80s and the early 90s I think that the really important thing for us to remember here is that the state can be used for all kinds of reasons at the moment we have the wrong balance state ought to be providing resources for productive investments like the way that labor did for the Channel Tunnel in the 70s or the way the defense have done with high-speed trains instead of doing that we're spending state expenditure on transfer payments in a way that has got no productive operative what kind of consequences and I think we do need to have a very serious discussion of the balance between private capital and the state but at the moment all the political parties are all avoiding George so we just want to endorse you know pretty much everything that Judith so I'm not going to repeat it if it was eloquently put the as aniconic sorry it's a bit nerdy right but it's kind of what I do but the standard text now about what do we know about financial crises and why do they happen and how do they behave and how do you get over them is now a book by two American economists by called Raghavan Reinhard it's called eight centuries of financial crises hey sorry yeah eight centuries of financial crises this time it's different ie never is different and I think you know Frank's point which is that it didn't really matter what side of political system it was whether it was social democracy whether it was free market whether it was you know whatever it was I mean everybody suffered from the same problem and the problem is well the problem is just deregulation in my opinion but actually the the idea about that you could free up those animal spirits in finance and expect human behavior to control itself I mean it's a human problem and it's something that is you know it's a serial human problem that goes back to the days of Rome and even before it's not a uniquely capitalistic problem is exaggerated by capitalism because of the nature of it but I think that the idea that you I mean as I said before there are lots of interesting ideas about you know whether it's you know mutual societies or cooperatives but you know handing kind of having state backs the Chinese banks were mentioned before the Chinese banks are insolvent so you know and the only way that they stay in business is because of because they get continuously bankrolled by the state that's not the answer either okay quickly Robin I think it is absolutely the answer I think one of the marvelous things about the crisis is we suddenly realize money which used to be that great thing that there was such a huge lack of that actually governments can just country it into existence and can endow other institutions with it so instead of you them using it to endow commercial banks I would rather think the network of social funds that would be a much more creative way to use it and I think it sort of provides some of the answer to the question can we do better I think if we look at the world there's too much misery far too much and I think it'd be wrong for Judith to imply that we can sort of live with that and imagine the market will spontaneously solve it the market hasn't solved it so I think we got to tackle it deliberately I'm just back from Brazil and Ecuador and I can say those countries have seen inequality sharply reduced in the last ten years because there are radical social democratic governments that haven't given up the ghost as sadly most European Social Democrats have done and I've taken really stern steps to spread economic initiative to show that there is such a thing as public entrepreneurialism that can tackle problems and get the economy moving thanks Robin we're going to move now to closing statements from each of the speakers while they are giving their closing statements the ushers will come round with ballot boxes to remind you you have a card with for or against printed on it if you are in favor of the motion please put the part of the card in a ting for in the ballot box if you are against but against if you're undecided put the whole card into the ballot box to remind you ladies and gentlemen of the motion is Karl Marx was right capitalism post 2008 is falling apart under the weight of its own contradictions while you are voting if you could be silent please while the speakers deliver their closing remarks in reverse order of having spoken so our first speaker against the motion will be doing it from the from the platform our first speaker will be Judith Shapiro just a couple of minutes summing up your case Judith please right well let me concentrate on a misunderstanding which can only be deliberate that two people have said that I think it's all going to happen spontaneously but I've made it very clear that in fact the people like you and me have to do something about it now in fact the agency which we will probably have to work is what Marx called bourgeois democracy that means political parties usually but they don't have to be the existing political parties I have slowly and reluctantly come to the conclusion that there is no other way out of the euro than to unwind it so I think the new party being formed in Germany to argue for that is probably right and I think that the French system needs such a party also because it came before its time and it has been a disaster and it threatens all of us including us offshore islands so I think that's very important when I ask you to vote against the motion it doesn't mean nothing is to be done it's the opposite it's because something is to be done and we have to do it now on the question of the state and the market which are definitely differences that as I understand it divide us on each side of the panel not between the two each country and each time has a different relationship the question is also which state and which market East Asian states have been able to do what my friends in Eastern Europe knew would be a disaster it may be that the Brazilian state is doing it well I have not been there and I am very suspicious always of reports from faraway places I heard it about the great Chilean pensions but I never bought it when they privatized them but I would like to know more about it because some states can there was enormous inequality in Latin America to be reduced it was low hanging reducing inequality in Western Europe is going to be more difficult and then the United States so I think it's very important in asking you to vote against the motion that you understand that we are talking not about accepting the status quo but rather seeing our side as having more to say about what is to be done and the other side of taking the view that it's also terrible and maybe even as a Tristram's first quote from angle said oh goody and then was disappointed that it was not getting so terrible now I know none of those speakers including Tristram have that point of view they don't want it to get worse but the point is there are things to be done and we have to decide what unlike Frank ferati I'm not willing to wait 15 years while we work out an alternative I'm not going to buy into a movement again which tells me that we'll think it up after we take power and so therefore what we need to do is to take the first steps decide what are good policies decide what which state can do it and do it well I know we don't need the housing bubble that George Osborne is planning for us but if he really goes ahead I personally think that you and me should buy some property in the autumn to sell it in two years when we have the crash just before the crash I'm usually bad at that so but the point is in asking you for your votes what I am asking you to do my other panelists may feel differently I am asking you to say that the present situation is not a good one but it is the best we have and we need to play the hand we have been dealt and let us hope that we will play it well thank you very much thanks Judy for the motion your summing up comments Frank the reason why I find Marx so compelling in so many ways is because of all the 19th century thinkers and possibly 20th century ones as well he was the one that was able to give the most systematic expression of the values of the Enlightenment I think that when it comes to the basic values of freedom and progress Marx put forward a very robust future-oriented view of possibilities he didn't just talk about how bad things were he was much more interested in pointing the way forward to how great they could be and his criticism of capitalism wasn't that it was just a bad system that it wasn't somehow working or right or or that it was to sort of exploitative his real criticism was that capitalism couldn't deliver the goods actually held back progress and the argument that really motivated Marx in the argument that he really developed the one that the one that is I think very relevant for us was a very simple one and it had to do with history as Kristin was saying Marx his stories as capitalism but what he also did was to show that history is not something that is out there history isn't something that just happens beyond our bags unlike many other defenders of capitalism who see history as something that happens to us somehow as Judy said we have this hand that's given to us and we got to deal with it he actually believed that history was made by human beings we don't have to be the objects of history we don't have to be the objects of history we could transform the world around so we can be the makers the subjects of history and it's his theory of human subjectivity which was the other side of his theory of capitalism that we really need to think about in the 21st century not because we need to merely repeat what he had said there's no point in merely finding refuge in the past but because we too need to begin to develop an outlook that sees ourselves as the makers of our circumstances rather merely the passive warriors that we are and I think in 21st century Britain when passivity is so deeply institutionalized when we really fail to take risks to begin to take matters in our own hands we're continually asking somebody else to do stuff for us where we really have become disempowered and become so perilous that all that we can imagine is that the state is the only institution that could sort things out under those circumstances rereading marks especially for those of you the younger generation will pay some very rich dividends summarizing against the motion Madsen Peary I don't think I don't think capitalism is the highest product of human social activity but I do think it is a cooperative human social activity if I were to put a book into the Canon I'm very reluctant to do that because once books are in the Canon people do have a habit of slaughtering large numbers of their fellow men and women in the name of those books I would however think this is unlikely to happen with Adam Smith's Theory of Moral Sentiments in that book he said that the most salient human characteristic is our ability to empathize with our fellow men and women to think as they think see the world from their point of view share their joys and sorrows and at the heart of capitalism is cooperation Marx thought it was exploitative and aggressive but it isn't it arises from human nature from that empathy we have with others when we trade we cooperate the very first act of trade is human beings cooperating it's not someone you know aggressively seeking only their own personal gain when someone invests they put aside the spending power they could be enjoying and instead they forego present consumption and put that money to use by someone who wants to create goods and services that other people will enjoy and use that money to advantage to provide betterment for other people I think capitalism will survive because inherently it goes with the grain of human nature summarizing his case a big button summarizing his case for the motion is Robin Blackburn yeah I think Madsen would find it interesting to dip into Das Kapital because Marx plays great tribute to cooperation in the capitalist mode of production and he says really it's private property that's getting in the way of realization of even higher levels and more effective levels of of cooperation in the Communist Manifesto he famously pays tribute to capitalism and it's the fact that it's unleashed enormous productive powers I would put the manifesto on my list for a cannon but I would say that while it has great epoch-making ideas it also has tiny little ideas that are quite interesting - like one of them he has a ten-point action program at the back one of them is to have a progressive income tax funnily enough in the world of 1848 when it first appeared there was no country that had a progressive income tax so that was an interesting idea that's been taken up quite widely I just would like to mention in that regard I was introduced by the president correa in Ecuador to the chief of his tax collection unit who as it happened is a Ecuadorian man called Carlos Marx and the thing that Carlos Marx told me is that he'd had the revolutionary idea for Ecuador not of raising taxes he said he thought that they were just about at the right level but of actually getting people to pay their taxes and he'd actually managed to double the country's tax revenue by this novel procedure so I would just conclude I I think we've got to learn to innovate in Social Affairs as well as in technology and that one of the innovations would be public entrepreneurship of seeing things that there's a crying need for something to be done about and democratically deciding to commit resources to that and then let the people involved get on with it without further meddling occasional accounting but not micromanagement and concluding his case against the motion George Magnus strangely I wasn't mentioned this but Robin just kind of spurred me to think about something that there is I think fair game because we've heard a little bit of discussion this evening about a lot of discussion about finance and about money and about QE and all that malarkey and we have this kind of idea that we have to produce all this QE actually the money doesn't go anywhere except inside the banking system so you know the problem about it is that we have this fixation that we can only use quantitative easing and use this tool to stimulate what we think will stimulate private spending and private lending and actually clearly it's not working because private sector wants to say it's going through that kind of a phase why we have this obsession that we can't use the same tool to basically take debt effectively straight off the government without increasing public debt and actually putting 50 billion pounds into the banks to capitalize them and get them to lend again which is kind of what we want or why we can't use you know a certain amount of money to basically achieve what the coming governor of the Bank of England Mark Carney is called as escape velocity which is you know builds some stuff you know get put people to work and then you know the private sector will take care of itself I think these things will you know could happen very easily but I want to kind of conclude really by just pointing out you know what again one of my gurus John Maynard Keynes basically identified as the central economic problem which was to combine economic efficiency social justice and individual liberty and I think that's been an evolving problem over the last 200 years or so and will be for the next 150 200 years and we are going to make mistakes from time to time as we have done in their 2000s to catastrophic effect we know and but you know I'm pretty sure we'll sort it out and you know there are as I try to allude coping mechanisms which will nurture and create to help us do this but it will take time and it's a very painful period thanks George and for his final comments in favor of the motion Tristram hunt well lady general you have all voted now and I want to pay tribute to those of you who are on the right side of history we've made the right decision tonight to the others we've given you a hint of a reading list it's a very good biography of angles available if you want to pursue that further I would also tell you that socialism is fun don't be worried embrace it one of angles is main concerns when he was living in Manchester in the 1850s was how to get the ingredients for lobster salad he got them in the end listen if you were part of a collective loss of 20 billion pounds on a collective rice farm you would probably begin to have some questions about the viability of Maoist socialism you are currently part in the UK of a 20 billion collective loss on our shareholder driven laissez-faire capitalist banking structure that is the loss you're facing at the moment so for those of you who said things aren't working out quite as well as we hoped for those of you who voted to say that Karl Marx might have a point you are on the right side of the analysis because what we want ultimately to end up with is is a more sensible system of wealth creation which is where this discussion have been heading at the end we want more producers and less predators we want more cooperatives and we want less collateral debt obligations and what we want to do to go back to George's musings around a high Gate Park and always remember that Karl Marx is buried in the shadow of a mental asylum is to stop the interpretation and to try to start to change the world thank you thanks very much Tristram and the final act of the evening Falls to me to read out the results of the vote to remind you the motion for the last time Karl Marx was right capitalism post 2008 is falling apart under the weight of its own contradictions before the debate those in favor of the motion numbered 203 those against were 214 and don't knows were 197 many of those don't knows have now made up their minds and the result at the end of the debate for the motion 217 against the motion 316 and don't knows 37 so my thanks to intelligence squared for hosting the debate and to the speakers thank you very much traitors in general

Channel: Intelligence Squared

Views: 867,600

Rating: 4.1974354 out of 5

Keywords: Intelligence Squared, Debate, great oratory, Intelligence Squared debate, speech, top debates, best debates, most interesting debates, educational debates, intelligence2, intelligencesquared, is debate, iq2, iq2 debate, iq squared, Communism, Communist Manifesto, Das Kapital, Capitalism, Tristram Hunt, George Magnus, Madsen Pirie, Judith Shapiro, Oliver Kamm, Robin Blackburn, Frank Furedi, etabedxramlrak, debate, talk, event

Id: QUaVeixiVLc

Length: 103min 27sec (6207 seconds)

Published: Thu Apr 25 2013