John Stuart Mill is a social reformer of his time. He is also the son of his time and this influences his perception of reality. The time in which he lives and the place in which his life unfolds are the circumstances that make Stuart Mill think about man the way he does; They also explain the idea he has about the morality of the human being; The same situation exists around social progress and rights….
Introduction
The present investigation tries to outline from a broad perspective, many of the points of view, political, human, social and economic, of John Stuart Mill, who lived throughout three quarters of the 19th century in England and, of the great thinker politician Karl Marx. The research goes through a review of 19 texts, many of which are by the main authors.
objective
Conduct an exploration and compilation of literature on the economic thought of John Stuart Mill and Karl Marx.
Methodology
The applied methodology will be review and exploration of texts, to make a compilation of different authors (and themselves) around the economic thought of John Stuart Mill and Karl Marx. Where emphasis will be placed on the topics of; classical economic policy; taxes: income, inheritance and consumption; poor laws and welfare policies; profits and wealth distribution and; Justice; on the part of John Stuart Mill. And, in the thought of Karl Marx it will be pointed out about; theory of value, theory of surplus value and exploitation, process of concentration and centralization of capital, decreasing rate of profit, origin of the economic crisis.
Theoretical framework
There is high agreement that John Stuart Mill was one of the great, if not the most prominent thinkers of the Victorian era. His works cover not only the area of knowledge of economics, but he also contributed opinions and studies of great impact on doctrines as broad as logic, political and social philosophy, epistemology, ethics, religion or metaphysics. The theoretical framework of the middle of the investigation revolves around all the literature by John Stuart Mill and subsequent work on the original ideas.
In the same way, the second half of the theoretical framework will be dedicated to the postulates of Karl Marx, who thoroughly investigated the economic laws of the movement of capitalist society, having studied countless works of Political Economy, sources, official documents, etc. In 1857 he began to write an extensive work on Political Economy, the draft of which is known as Economic Manuscripts of 1857-1858. In that period he broadly formulated the basic theses of the theory of surplus value, the cornerstone of Marxist political economy. He thought that he would use these manuscripts when he wrote a fundamental economic work to which he proposed to title Critique of Political Economy And also on later works carried out on the original ideas.
John Stuart Thousand
John Stuart Mill (1806-1873) was a progressive and liberal, he tried to reconcile the English classical economy with the historical and socialist currents in vogue during the 19th century. Being a philosopher and economist from England (who even made a sporadic foray into politics) born in London. When he was very young, at the age of three, he already gave evidence of unusual intelligence. James Mill, his father, was in charge of strictly directing his son's education from his earliest childhood, so that by the age of eight he had already read in the original language several of the great Greek authors; Next, he learned Latin, logic, mathematics, physics, chemistry and at the age of thirteen he followed, directed by his father and in the peripatetic style, a course in political economy using Ricardo's Principles of Political Economy as a text. For (Escartin,John Stuart Mill) John Stuart Mill, progressive and liberal, tried to reconcile classical English economics with the historical and socialist currents in vogue during the 19th century.
Classic economic policy
We know that economists had already felt the need to define their field before A. Smith, but it was during this period, called the Classical School, that John Stuart Mill's definition of Political Economy offers, like most authors' classics, it is not very specific. It defines that it deals with the “Principles of the nature of wealth and the laws of its production and distribution, including, directly or remotely, the updating of all the causes for which the situation of humanity, or of any society of human beings, prospers or declines with respect to that universal goal of human desires ”(Mill, Principles of Political Economy, 1951).
The laws of social phenomena that derive from the combined operations of human beings for the production of wealth, to the extent that these phenomena are not modified by the pursuit of any other objective. Mill defends the deductive, abstract, a priori method of discovering the laws of economics along the lines of what Marshall would later coin as the ceteris paribus clause for neoclassical economics. Mill makes a defense of the theory, but warns of the risk of incorporating highly simplified theoretical models into economic policy that must be applied to the complex real world. He believes that economics is much more than can be encompassed by a purely deductive theory (Pelet, 2001)
The classics widely accepted the private property regime. Property and security were essential components of the incentive for economic growth. Only Bentham and JS Mill supported plans for property and inheritance reform. Only JS Mill showed genuine sympathy for socialism. At first, his position with respect to socialism was one of doubt about innovation, incentives, distribution, and the likely evolution of the population under a socialist system.
Mill is embedded in the realm of liberal thinkers; and with the principle mentioned above, he is defending a freedom of a negative type, that is, one that supposes the absence of obstacles in action. His idea of freedom is negative freedom that includes the elimination of paternalism, which postulates intervention in the freedom of the individual seeking the best for him. (Mill, Essays on Politics and Society, Part I, 1977).
Taxes: income, inheritance and consumption
The thought of this author on taxes is based on the principle of Contributory Capacity and leads to the principles of equality, proportionality and minimization of sacrifice and progressive taxation, arguing that the principle of profit implies a regressive tax, meaning that the principle of equal taxation equates to equal sacrifice.
Making a classification between the various taxes that he divides into direct taxes, those that fall on income and indirect taxes or consumption taxes. The income tax that falls on the landlord, the profit tax that falls on the capitalists, the wage tax that reduces the standard of living of the working class or falls on the profits by charging the capitalist with an indirect tax. For Mill, the most relevant taxes for the economy are: taxes on merchandise since they raise their price and reduce the quality of life of the worker; taxes on the foreign sector and taxes on fiscal systems, that is, on contracts, mainly those of purchase and sale; on communications, postal services, newspapers;on the operations of the courts; and local taxes destined to finance public spending such as lighting, cleaning, etc. (Sources, 2015).
With regard to large fortunes acquired by donation or inheritance, the power to bequeath is one of those property privileges that it is convenient to regulate for reasons of public utility; and I have already suggested as a possible means of restricting the accumulation of great fortunes in the hands of those who have not earned them by their efforts, to limit the amount that any person can acquire by gift, bequest or inheritance. Apart from this, and Bentham's proposition that intestate collateral inheritance cease, and that property expires in favor of the State, I believe that inheritances and bequests that exceed a certain amount should be taxed: and that the income obtained from them must be as high as possible without causing evasion, by donation inter vivos or by concealment of property,in a way that would be impossible to contain properly. The principle of graduation (as it is called), that is, of taxing with a higher percentage the greater the sum, although its application to taxes in general would be, in my opinion, reprehensible, it seems to me at the same time fair and convenient applied to inheritance and legacy rights (Mill, Principles of Political Economy, 1951).
Poor laws and welfare policies
Laws are for John Stuart Mill a tool whose usefulness lies in their ability to shape life in society and relationships with one another, while helping to dissuade any individual from harming another. Ultimately, what is involved is that through these laws the rights of each individual are respected and the tension between the individual and society is properly conducted.
In the time of Mill, a period was reached in which progress, even political progress, was coming to a halt, due to the low moral and intellectual status of all classes, and of the rich as well as the poor. The only thing I hope for permanent good is great improvements in education. Since then, he thought that the way to improve, in the long run, the quality of life of individuals, is through education. Only education will remove the individual and societies from the steady state in which the progress of science and technology maintains it, which involves other fields such as economics. Mill himself warns on various occasions in his works about the moral effects of progress and is an opponent of those who defend this thesis of the struggle to advance. (Sources, 2015).
“The well-being and good behavior of the working classes must henceforth rest on very different bases. The poor have dropped their walkers and can no longer be governed or treated as if they were children. Her destiny must henceforth depend on her own qualities. Modern nations will have to learn the lesson that the welfare of a people is to be achieved through justice and freedom of the
citizens, rights… now, when even in relation to their situation they are less and less subordinate and their spirits less and less satisfied with the degree of dependence that still remains, it is the virtues of independence that they most need. From now on, the advice, the exhortations, the norms of conduct that are proposed to them, have to be offered to them as equals and they accept them with open eyes. ”This sentence summarizes that welfare policies for the poor are based on lay the foundations to suggest self-development.
Profits and the distribution of wealth
(Mill, Principles of Political Economy, 1951) exposes, in the style of Senior, a theory of abstinence, according to which people, in order to induce them to save, must be remunerated for their sacrifice since abstaining from present consumption is obtained capital. As he says (ibid., P. 360): "the capitalist's profits are properly, according to Mr. Senior's fortunate expression, the remuneration of abstinence." It also included in the benefits the disbursements for insurance payments for the risk assumed when carrying out the production, and the payments to the management personnel for the skill in managing the company and the time and effort devoted to it. Gross profit consists of three parts that pay for abstinence, risk, and effort. Each of them receives the name of interest, insurance and management salaries. In (Mill,Essays on some disputed issues in Political Economy, 1997) the idea of
that profits can be increased, either by lowering wages or by reducing their cost of production, that is, the value of labor power or the value of the goods that workers consume. This striking idea is similar to Marx's discussion of absolute and relative surplus value.
Regarding the distribution of wealth, he notes that: “The laws and conditions of wealth production participate in the nature of physical truths. There is nothing optional or arbitrary about them. This does not happen with the distribution of wealth. This is a. a matter that exclusively concerns the human institution a. Once the elements are available, man, individually or jointly, can do whatever he wants with them ”(Mill, Principles of Political Economy, 1951). For Mill the concept of distributive justice was Lockean in its origins. Although this Lockean position inclined him toward the redistribution of goods and profits, it does not have a specific egalitarian nature.Mill openly acknowledges the Lockean lineage of his doctrine of property and distributive justice in his quasi-dogmatic claim on the foundation and limits of property rights (Gray, 1979)
Justice
"Justice is the name of certain classes of moral rules that refer to the essential conditions of human well-being more directly and are, therefore, more absolutely binding than any other type of rules that guide our lives.
As he says, his work (Mill, 1984) has been criticized as to whether or not the concept of justice has a place in utilitarian doctrine. For the author of El Utilitarismo, justice fits within his philosophical doctrine; and it also makes sense insofar as it leads to general happiness. In Utilitarianism, Mill tries to expose us to the double aspect between the idea of justice and the feeling of justice. The idea of justice supposes two premises. On the one hand, a rule of conduct that pursues is the achievement of the common good among all; and, on the other hand, a feeling that sanctions the rule, which is made explicit in the desire that those who break the rule be punished.
When speaking of "fair" and "unfair", these terms are used by the individual in general to label certain actions or behaviors of humanity. But these labels are related to the feeling that these terms provoke for the individual. The notion of justice implies a series of elements that Mill points out: law, right, impartiality, equality, convenience, loyalty. All this based on a series of considerations that Mill reviews without dwelling on them. All these elements affect the emotion of the individual; and this is the one that ends up qualifying an action as fair or unfair based on them. Thus,For Mill to justify in the universe of diverse situations what it is that makes us qualify something as "fair" or "unfair" is to accept that "essentially the moral feeling that is linked to the term in question" depends on that quid (Fuentes, 2015).
Karl Marx
"A non-objective being is a non-being… an unreal, non-sensible, purely thought entity, that is, purely imaginary, an entity of abstraction.
Karl Marx (1818-1883) is indivisible. This applies both to the unity of the theory that he developed together with Frederick Engels, scientific socialism, and to the importance of Marx and his work in every corner of our planet and in the life of humanity. It is true that Marx was a son of the German people, and his heirs on German soil are proud of it. But from the moment it was born, Marxism was - and still is - universal and international, and that in more ways than one. (Gemkow, 1975) says that it is universal because in creating their theory Marx and Engels drew on the latest discoveries in international science, especially classical German philosophy, classical English political economy, and French teachings on
the class struggle, socialism and communism; and because they critically elaborated the most advanced ideas that governed in all these areas. He is an investor because Marx and Engels studied throughout their lives, and generalized, the experiences of the international working class, the experience of the workers of each of the countries, and they did so with the utmost care.
Theory of value
The labor theory of value has a practical and regulatory value, but not theoretical because it is indeterminate and because it does not have general applications to the use of currency, so a monetary reformulation is proposed as an institution that remedies this discrepancy, allowing the integration of private works (heterogeneous, production) to social works (homogeneous, circulation), this phenomenon is what Marx considered as a "somersault of the merchandise", money-currency can then be postulated as logically prior to the law of value, therefore it can be said that it is a “heterodox” reformulation with a monetary base (Cataño, 2009).
According to Marx (ib., P. 255), it is the sum of these three components:
Vt = c + v + p
Of these components c and v are the remuneration corresponding to the costs of production and the surplus value (p) originated by the work, which when seized by the employer constitutes the exploitation of the worker. This is possible due to the ownership of the means of production, the monopoly exercised over them and the special characteristics of the labor market, which the capitalist system itself is responsible for configuring.
According to the conclusions of (Lebeo, 2016), Marx's labor theory of value is a regulatory critical theoretical instrument of the social division of labor, taking up Hinkelammert and Mora, the importance of concrete work and the subject of needs is pointed out. Emphasis on the need to advance in theory, leaving the concept of equivalent in exchange, an idea that is supported by the numerical examples presented, however, although Hinkelammert and Mora take up the concrete work on abstract work, they abandon the idea of forms of value and its relationship with value, this is a limitation in the advance of the order in the social division of labor as they themselves propose. It has been argued that the theory of value worked with its relation to the form of value and hence to currency,it is indeterminate (ambiguous in the best of cases), and has been rethought in order to explain a system of prices and exchanges of products and money. It is surprising that the theory of value is subjective or objective, until recently it has not considered currency as a logical and theoretical principle, and rather, it has been considered as an external element, in which in the end it is integrated to validate the theory of value. (Benetti, 1990) In this sense, this study develops a proposal for progress in the vision of value and currency, to be able to explain how it is that the social validation of goods needs currency, or in other words, how specific jobs are turn into jobs socially.It is surprising that the theory of value is subjective or objective, until recently it has not considered currency as a logical and theoretical principle, and rather, it has been considered as an external element, in which in the end it is integrated to validate the theory of value. (Benetti, 1990) In this sense, this study develops a proposal for progress in the vision of value and currency, in order to explain how it is that the social validation of goods needs currency, or in other words, how specific jobs are turn into jobs socially.It is surprising that the theory of value is subjective or objective, until recently it has not considered currency as a logical and theoretical principle, and rather, it has been considered as an external element, in which in the end it is integrated to validate the theory of value. (Benetti, 1990) In this sense, this study develops a proposal for progress in the vision of value and currency, in order to explain how it is that the social validation of goods needs currency, or in other words, how specific jobs are turn into jobs socially.1990) In this sense, this study develops a proposal for progress in the vision of value and currency, in order to explain how it is that the social validation of goods needs currency, or in other words, how concrete jobs become jobs. socially.1990) In this sense, this study develops a proposal for progress in the vision of value and currency, in order to explain how it is that the social validation of goods needs currency, or in other words, how concrete jobs become jobs. socially.
Theory of capital gains and exploitation
(Marx, 1867), pp. 237-240) Marx distinguished between use value and exchange value; but he focused on the second which is the proportion by which the different use values are changed. The exchange value depends on the amount of human labor incorporated into the commodities in their production. Since there are different types of work, it is necessary to homogenize work by an abstract measure: "socially necessary work." Thus, specialized work would be multiplied by a coefficient, according to the type of specialty and the work of the same specialty, but more or less efficient it would be evaluated according to the deviation with respect to its mean.
(Dobb, 1973) defines other classifications, namely that of "human labor" and "labor force" (Human labor is the number of hours actually employed by the worker (that is, living labor) and, as He has said, it is the foundation of the exchange value of things. Labor power is the number of hours of work necessary to provide the energy consumed by the worker, equivalent to the nutrient matter that is needed to replace the energy used by the worker. human labor, which, in the capitalist system, is sold in the market giving rise to the salary set at the minimum subsistence level. This is so because in the capitalist system (which is in charge of maintaining a reserve army of labor) the Competition for a job reduces the price (in this case the salary),as if it were any other merchandise that is bought or sold, up to the minimum in which the production costs are recovered, if possible; These, in the case of the worker, are limited, "about a little more or less, to the minimum that he needs to live and to perpetuate his race" (Marx & Engels, The Communist Manifesto, 1848) The rate of exploitation, e, is defined by Marx (ib., p. 260) as the relationship between capital gain and variable capital:
E = p / v
This ratio is equivalent to the benefit per hour of paid work (or, in other words, to the benefit per man, since a given number of hours of work constitutes a man's salary per day).
The surplus value that (Marx, Capital, Volume I, 1867) designates, is the difference between the value of human labor incorporated in the production of a commodity and the value of the labor power paid for that same production. That is, it is the part of the value of human work that has not been remunerated to the worker.
The value of the product incorporates the value of the human work carried out throughout the working day; but the salary paid to the worker represents only the value of a part of that day, which allows the worker to survive. The difference between the two, which is appropriated by the employer, is the capital gain. For these reasons the capitalist system necessarily exploits the salaried worker.
Capital accumulation and centralization process
As noted (Marx, Contribution to the critique of political economy, 1859) the first natural form of wealth is the superfluity or surplus of products; It is the part of the products not immediately required as use value, or else the possession of products whose use value is beyond mere necessity. In examining the transition from the commodity to money, we saw that precisely that superfluity or surplus of products in an underdeveloped phase of production constitutes the sphere of exchange of commodities. Superfluous products become interchangeable products or commodities. The proper form of existence for this superfluous product is gold and silver, the first form in which wealth is fixed as abstract social wealth.Not only can goods be preserved in the form of gold or silver - that is, in the material of money - but gold and silver are also wealth in a form whose preservation is assured. (Escartin, Carlos Marx).
The organic composition of capital (coc), k, is a useful concept introduced by Marx (ibid., Pp. 331 and 771) to designate the relationship between constant capital and variable capital. So it is that:
k = c / v
(Lenin, 1914) In his work on Marx, he understands the historical trend of capitalist accumulation with the following famous words: «The expropriation of the direct producer is carried out with the most ruthless vandalism and under the spur of the most infamous passions, dirtier, meaner and more unbridled Private property, the fruit of one's own work, and based, so to speak, on the understanding of the individual and independent worker with his instruments and means of work, is displaced by capitalist private property, based on the exploitation of the labor force of others, although formally free.
Decreasing rate of profit
Marx believed that, with industrialization and the entrepreneur's predisposition to increase the organic composition of capital, the rate of profit would decrease, unless the rate of exploitation increased simultaneously and simultaneously. He analyzed the elements that influence this last rate, p and v, and deduced that its possible variations would not be so significant as to raise it appreciably; on the contrary, the tendency would be for the exploitation rate to fall. Therefore, he maintained the thesis of the decreasing trend of the rate of profit. (Escartin, Carlos Marx).
(Marx, Capital, Volume I, 1867) The higher productivity of labor translates into an increase in the relative surplus value, since, without changing the other circumstances, it reduces the number of hours of work necessary to obtain the value of the wage of the employee. It should be borne in mind that precisely the latter is what happens when the organic composition of capital increases, since, with the technological advances that it incorporates, a large increase in productivity per employee is originated and the employer can obtain the amount of the payment of wages with less hours of work of the worker. That is, by evaluating it in hours, paid work (v) decreases, and, therefore, for a given duration of the working day, unpaid work increases (or capital gain (p), which in this case is relative,because the other conditions of the worker and of production need not have changed). Consequently, the rate of exploitation increases appreciably for this double reason, and, thus, it would not necessarily be inevitable that the rate of profit had to decrease.
Marx did not want to value the theory implicit in the concepts of absolute surplus value and relative surplus value, and this personal assumption is due to the fact that from Marx's own theory it can be deduced that capitalism would survive far beyond the immediacy of its predicted collapse by Marx. (Marx, Capital, Volume I, 1867) And that is so because the capitalist system allows the increase in the rate of exploitation (through relative surplus value), the increase in the rate of profit (or at least, its maintenance indefinite) and the increase in the standard of living of workers.
The rate of profit (r) is the quotient between the surplus value and the totality of the capital consumed in production:
r = p / (c + v)
Origin of the economic crisis
The dialectical and dynamic conception of economic systems led Marx to study how many internal contradictions he found in capitalism. With the intention of exposing the failures of capitalism, he presented ideas that would later undergo theoretical developments, such as, for example, underconsumption, overproduction, short and medium cycles, fluctuations in investment and profits., as well as the ineptitude of an unplanned economic structure. Likewise, he analyzed the market crises caused by the decrease in the profit rate, which led to a stationary state (due to lack of stimulus to investment) and to a situation of chronic underconsumption (due to the impoverishment of the proletarian masses). However, although he mentioned the economic crises,He did nothing to devise a theory about the business cycle; All his effort was devoted to showing the crises of capitalism as a result of economic and social tensions with a view, not to correct them, but to highlight the causes that would cause the collapse of the capitalist system and its replacement by another.
(Escartin, Carlos Marx).
The constant substitution of capital for labor carried out by the capitalists was the cause of growing unemployment, of "poverty and restricted consumption of the masses," which was "always the ultimate cause of all real crises" (Spiegel, 1987) These crises would become more and more profound, until the proletarians, once aware of their condition, would unite and taking advantage of a particularly serious crisis would end up conquering power and destroying capitalism.
Final thoughts
John Stuart Mill is a social reformer of his time. He is also the son of his time and this influences his perception of reality. The time in which he lives and the place in which his life unfolds are the circumstances that make Stuart Mill think about man the way he does; They also explain the idea he has about the morality of the human being; The same situation exists around social progress and rights.
We can then realize the enormous influence that these thinkers had on paradigms and economic conceptions, even in the present time. As they have helped shape thought and life, since they not only focused on economic ideas, John Stuart Mill and Karl Marx, were social beings who tried to break down the class barriers, by helping and concentrating on the less favored.
Bibliography
Mill, JS (1984). Utilitarianism. Madrid: Editorial Alliance.
Fuentes, JR (2015). John Stuart Mill and Education as a Human Right: (1 ed.). Madrid: The Tailor of Books.
Mill, JS (1951). Principles of Political Economy. Mexico DF: Economic Culture Fund. Pelet, CR (Oct 2001). John Stuart Mill: the maturing stage of the classical school.
Social Actions and Research, 13, 87-104.
Mill, JS (1977). Essays on Politics and Society, Part I. Collected Works of John Stuart Mill, 13. Mill, JS (1997). Essays on some disputed questions in Political Economy. (CR
Braun, Ed.) Spain: Alianza Editorial.
Gray, JN (Apr-Jun 1979). JOHN STUART MILL: TRADITIONAL INTERPRETATIONS AND REVISIONISTS. Literature of Liberty, 2.
Escartin, E. (nd). John Stuart Mill. In E. Escartin, History of Economic Thought. Benetti, C. (1990). Currency and Theory of Value. Mexico: Economic Culture Fund. Cataño, JF (2009). Lessons from Marxist economics: markets, prices and money from a
heterodox approach. National University of Colombia, Bogotá.
Lebeo, AG (Jul-Dec 2016). Value, price and currency, a review based on «Capital»
of Carlos Marx. Economia y Sociedad, 35, 137-153.
Marx, K. (1867). The Capital, Volume I (In Spanish ed.). Madrid: Siglo Veintiuno Editores SA Marx, K. (1859). Contribution to the Critique of Political Economy. Progress.
Dobb, M. (1973). Theory of value and distribution since Adam Smith. Buenos Aires: Century
XXI Argentina Editores SA
Marx, K., & Engels, F. (1848). The Communist Manifesto. Madrid: Endymión Editions. Gemkow, H. (1975). Karl Marx: Complete Bigrafia. (F. Mazai, Trad.) Buenos Aires: Cartago. Escartin, E. (nd). Carlos Marx. In E. Escartin, HISTORY OF ECONOMIC THOUGHT. Lenin, V. (1914). Carlos Marx. Encyclopedic Dictionary of the Granat Society Hnos.
Spiegel, HW (1987). The development of economic thought. Barcelona: Omega Editions
SA
Download the original file
