The Communist Manifesto, By Karl Marx

Karl Marx, who wrote the Communist Manifesto in 1848, sees capitalism as inherently flawed. According to him, it is simply a stage in a long history of evolving forms of economics and relations between people. He sees it as just the current form, following feudalism, and, eventually, leading to socialism. While he does believe capitalism will eventually stagnate and fail, Marx believes that a revolution is needed in order to completely get rid of capitalism. He does not share the belief that legal social reforms will be sufficient to correct its internal flaws. In his view, capitalism is too focused on profit, which requires exploitation of workers. In order to understand his theories, it is important to know that Marx sees classes as

being comprised mainly of two sides, one as an oppressor (Bourgeoisie), and the other as the oppressed (Proletariat). The capitalists, are using their resources, resources such as capital, machinery, mines, and factories, to exploit the Proletariat, otherwise known as the working-class. And the Bourgeoisie will not voluntarily give up all of their power and wealth, this must be taken away from them, and it will only be taken away successfully through a violent revolution.
There are a number of differences between capitalism, for which Smith argued, and communism, for which Marx argued. One key difference is the ownership of the means of production. In a capitalist society, the means of production are owned by private owners. In communism, however, the means of production are owned by the state. Profits are equally shared in communism, whereas profits in a capitalist society belong to the private owner only.
Adam Smith, who published his famous book in 1776, however, sees capitalism as a way to dramatically increase efficiency and growth in an economy. Smith, in An Inquiry Into the Nature and Causes of the Wealth of Nations, believes that by utilizing ideas such as the division of labor, countries can exponentially improve their production. He states that division of labor has resulted in “universal opulence which extends itself to the lowest ranks of the people.”
Smith notes, in Of the Wages of Labour, that the masters of workmen “can combine much more easily; and the law, besides, authorizes, or at least does not prohibit their combinations, while it prohibits those of the workmen (28).” He goes on to say that there are no laws against “combining to lower the price of work; but many against combining to raise it (28).” He says that it is rarely heard of for masters to combine to agree to not raise wages. The reason for this, Smith argues, is that it is because it is always happening, and it is always happening in secrecy. This is exactly what Marx fears. Almost all of the power is in the hands of the masters, of the owners of the means of production, and there is very little power in the hands of the proletariat. There are no laws against the combination of masters to lower wages, but there are laws against the combination of the people who work for the masters to combine to demand fairer wages. This is the opposite of how Marx would have it; the power to change wages should be in the hands of those who are working, not those who are exploiting. Also, masters are always combining because they all know that to raise the wages would make them unpopular amongst their peers.
Low wages is something that Marx discussed in the Communist Manifesto, stating that the proletariat is a “class of laborers who live only so long as they can find work, and who find work only so long as their labor increases capital.” Marx is saying that these people can only survive by working, but they can only work if it increases the profits of their prospective masters. Businesses want to minimize costs and maximize profits. Therefore, they will only employ as many people as is absolutely necessary to keep the profits rolling in, and they will pay these employees as low of a wage as is acceptable. Workers, generally having few other options, are forced to accept these low wages, sometimes even if the wage is not enough to sustain their families. Adam Smith offers up no solution to the problem of low wages or poverty. His failure to do so is notable, since it is a problem that plagues contemporary society, a society where pure capitalism is rare, as most major countries use some sort of capitalism-socialism hybrid. Yet there is still a significant number of people worldwide that struggle to sustain themselves.
One of Smith’s main ideas is that of division of labor.

According to him, growth is rooted in the increasing division of labor. Smith gives three main reasons as to why this is. His first reason is that by dividing labor amongst various workers, it creates a specialization in knowledge of a particular task. Next, dividing labor saves the workers time by focusing on one task and not having to move from one to another, which will usually mean having to use different tools. The worker is, therefore, able to make the most of his time, which increases productivity. Lastly, by spending more time on one task, the workers are more likely to innovate in the methods used in performing the task, which makes it easier to perform the task and save more

time.
Marx does not directly discuss the division of labor but he does discuss the value of what the workers create and how the capitalists use this value. One of the fundamental themes of Marxism is that in order for the capitalists to profit they have to exploit their workers. When a capitalist’s workers create something, they create something of value. So when the capitalist sells that item for more than the amount of value that went into making it, the capitalist is taking some of the value that the worker created. This is part of the major flaws inherent in capitalism, the workers put in work and do not share in the profits, unlike their capitalist masters.
Though there are a number of points that Marx and Smith disagree on regarding capitalism, there a few main differences.

Possibly most importantly, Smith believes that capitalism is the key to growth and efficiency, while Marx sees capitalism as merely a stage in history that will ultimately fail and lead to socialism. Marx believes, however, that in order to rid the world of capitalism, there needs to be a revolution. He believes that major social change is not possible without revolution, and he also believes that legal reforms are not enough to correct the flaws inherent in capitalism. Marx views capitalism as creating two main classes, the Bourgeoisie (what he calls the oppressors), and the Proletariat (what he calls the oppressed). Smith, however, sees capitalism as a way to increase everybody’s wealth and productivity. One key idea in capitalism is that businesses want to maximize profits and minimize costs, often at the expense of the workers. This means that the businesses will only employ as many people as is necessary to keep profits up and they will pay these workers as little as possible. Smith fails to offer up a solution to this problem of low wages, while a fundamental theme of Marxism is that capitalists are taking part of the value that was created by the workers when they sell it for more than it cost to make it. One can easily see that the splitting up of the profits amongst the master and the workers would be the solution, and that is part of the

basis of communism, the sharing of profits.