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March 20, 2008

Evaluating Karl Marx as Political Activist: Morning Coffee for Holy Thursday


Good morning. I am Brad DeLong. And this is my morning coffee--my morning coffee for Holy Thursday.

Yesterday I said that I divided up--that we divide up--Karl Marx into three: Marx the economist, Marx the political activist, and Marx the moralist prophet, and that I might talk about Marx the activist and Marx the prophet some other time. And Holy Thursday appears to be a good time.

Marx the political activist. Marx the political activist had five reasons that he thought it necessary and possible to work to overthrow the current system. First, he believed that because capital is not a complement to but a substitute for labor, and so technological progress and capital accumulation that raise average labor productivity also lower the working-class wage. Hence the market system could not and in the end would be seen to be unable to deliver the good society we all deserve, and so it must and will be overthrown. This seems to me to be simply wrong.

Second, Marx believed that businessmen continually extend the domain of captalism, and competition from poor workers in newly-incorporated peripheral regions puts a lid on the wages of labor. Hence inequality grows in the core, which should and in the end must trigger revolution. This seems to me to be largely wrong as well: it is very possible for the international economy, if properly managed, to balance up and not balance down as far as the level of real wages is concerned.

Third, Marx believed that previous systems of hierarchy and domination maintained control by hypnotizing the poor into believing that the rich in some sense "deserved" their high seats in the temple of civilization. Capitalism, Marx thought, unveils all--replaces masked exploitation by naked exploitation--and without its ideological legitimation, unequal class society cannot survive. This also seems to me to be completely wrong on its own terms--see Antonio Gramsci, passim, also Fox News.

Four, Marx believed that even though the ruling class could appease the working class by sharing the fruits of economic growth, they would not. They were trapped by their own ideological legitimation--they really do believe that it is in some sense "unjust" for a factor of production to earn more than its marginal product. Hence social democracy would inevitably collapse before an ideologically-based right-wing assault, income inequality would rise, and the system would be overthrown. The Wall Street Journal editorial page works day and night 365 days a year to make Marx's prediction come true. But I think they will fail.

Fifth, Marx believed that factory work--lots of people living in cities living alongside each other working alongside each other--would lead people to develop a sense of their common interest and of class solidarity, hence they would be able to organize, and revolt, and establish a free and just society in a way that they could not back in the old days when the peasants of this village were suspicious of the peasants of the next village. Here I think Marx mistook a passing phase for an enduring trend: active working-class consciousness as a primary source of loyalty and political allegiance was never that strong; nation and ethnos seem to trump class much more often than not.

There is very little in Marx the political activist that is worth paying attention to--in fact, I would say that there is less than nothing once you recognize that his own polemical habits and his failure to prophesy what would happen after the Revolution created the cracks that turned Marx's world-religion into one of the greatest evils humans have ever managed to create.

I'm Brad DeLong, and this is my morning coffee.

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It's interesting to contrast your remarks on Marx with Niall Ferguson's freshman history class at Harvad this semester. In contrast to your second point on inequality he said Marx got increasing inequality correct but this was compensated for by the spectacular rise in absolute wealth of the working class in the late nineteenth century.

In connection with your fourth point he emphasized that increasing democracy (suffrage) led to progressive taxation and thus the provision to the working class of public goods such as education and public health thus indirectly and unwillingly the rich did end up helping the poor

With respect to your fifth point he emphasized that Marx said the working class would become homogenous but they did not. Skilled workers were segregated in their own unions and were careful to differentiate themselves from the poor

There are some interesting points of contact such as the Industrial Revolution and Marx in the two courses although they are very different courses with very different audiences. Maybe some of the freshmen members of his class will be your graduate students in a few years. If they imbibe a fraction of Ferguson's ferocious work habits they will do well.

Two comments:

1) I do not believe that Marx ever really directly addressed the idea of social democracy. In most of his writings wages were set at subsistence level and that was that, and, of course, there had been little effort at anything like social democratic or welfare state policies by the time he died. It was really after he died that it became very clear in Western Europe that wages were rising with rising output, and the revisionist movement within the German Social Democratic Party, as well as similar strands in other parties in other countries, appeared. I note that the the Labor Party in Britain did not get a member into Parliament before a decade after Marx died, and it was not until the first decade of the 20th century that the first socialist got a ministerial position in a European government, Millerand as Labor Minister in France around 1906. Indeed, in Germany, it was at the turn of the century that Bernstein first openly articulated the revisionist vision that would become modern social democracy.

Second, while one can discount the strength of the working class movement, Marx was in a broad sense correct that the capital-labor conflict would be the largest and most defining political divide in most industrialized nations for probably a good century, most of the 20th century anyway. If one looks at most western European, or the US, or other high income English-speaking countries, or Japan, one finds that in most countries the two most powerful political parties (when these countries had democratic systems) were probably most clearly divided by one being the party of the capitalists and the other of the labor unions and workers. This remains true even now in most of these countries, even as labor unions weaken and other issues and interests and groups come to increasingly dominate discourse. This is not to deny that sometimes capitalist groups have been able to use racism or nationalism to divide workers (the US being a prime example), or that when war hit big time, such as in 1914, the workers of each nation rallied more to their respective to their nations than did they follow Marx's appeal to unite with each other across national boundaries.

So Marx's negative record on politics cancels out his positive record on economics. But until I see which way his record on morality goes, I guess I'll have to remain in limbo not knowing whether Marx's overall record will be a positive or negative one...

it is very possible for the international economy, if properly managed, to balance up and not balance down as far as the level of real wages is concerned.

Yes, I think that would be an admirable goal and one you should work towards.

Brads argument doesn't make any more sense to me than to blame the evils of Christians on the historical Jesus. What Marx did and said must be understood in the context it was said - what happened afterwards with his ideas is not really relevant when judging the man.

Class identity is much weaker than the bonds of language, religion, or family. Seldom do class considerations override the others.

However, a long-term trend in modern globalist capitalism is the gradual diminution of those other bonds, in the areas longest enjoying advanced capitalism.

If the world over time becomes more and more integrated into a global capitalist milieux--in other words if capitalism fully matures--class identities will become more prominent by default.

Nobody would ever really want to embrace a proletarian identity and team up with other proles. It's not a desirable thing to do.

But there may well come a time when there's just no other real identity left for many people.

Marx was basically right on 1 and 2. The only countervailing force was political action, starting with the Chartists in England. Even you recognize this or you wouldn't need to say things like "properly managed". What is proper management? Why shouldn't the manager grab the lion's share and leave nothing, or a bare survivable minimum, for everybody else. (Look it up, the "lion's share" is all).

If I remember correctly, workers only started getting some of the fruits of the Industrial Revolution when the king, a medieval figure, intervened and threatened to pack the House of Lords. In the states, it took violence, more violence, and The Great Depression. The impact of rising productivity on living conditions is a result of politics, not science.

I don't quite get it. I keep reading reasons three and four over and finding them to be opposites:

Third... [in] previous systems... the poor... believ[ed] that the
rich in some sense "deserved" their high seats in the temple of
civilization. Capitalism, Marx thought, unveils all...

Four [the ruling class] were trapped by their own
ideological legitimation--they really do believe that it is in
some sense "unjust" for a factor of production to earn more than
its marginal product.

The only way I can read those two excerpts and not find them to be in contradiction is if I assume the poor are more smarter than the rich. The poor no longer think the rich "deserve" their seats because they see how things really work. The rich on the other hand, now think the poor do deserve what they get and it would be morally wrong to do anything about it even if the rich might be richer on the margin if they did. Is that what Marx is saying?

Talking about Marxism, I wonder what the eminent Professor thinks about the recent turmoil in Communist China.

Certainly the ability to shut down news from any section of a country, declare in effect martial law, and do away with domestic opponents through state violence gives a country certain economic advantages that a lonesome democracy like our own just can't match.

For someone so attuned to Chinese sensitives when it comes to exporting our jobs to them, this silence on the latest events seems strange.

"his failure to prophesy what would happen after the Revolution created the cracks that turned Marx's world-religion into one of the greatest evils humans have ever managed to create."

But this is partly the fault of respectable economists, no, that they were largely unable to paint a coherent, plausible picture somewhere in between laissez-faire and marxism to inspire the activists and revolutionaries of the time? I mean, there were a *lot* of socialist cranks in the 19th century, not just Marx. They were there because there was a need for them, because the conventional economists of the time were so obtuse and unsatisfactory.

Even now, with an undergrad econ education I have very little idea how to answer the question, Why are rich countries/regions/people rich and poor countries/regions/people poor? Nor the question of what policies poor countries/regions/people should adopt.

I was reading a bit about Peter Cooper today, and came across this interesting passage:

http://www.ringwoodmanor.com/peo/ch/pc/pc.htm

"The death of Peter Cooper had plunged me into a peculiar strain of thought. Here was a man whose grand purpose in life was the elevation of the working classes, and to the realization of this object he devoted his time and money with what results is known to the world. On the other hand there is Wm. H. Vanderbilt, a man who devotes his hours by day and many of his hours by night to the accumulation of wealth. As I reviewed the characters of these men the contras they presented impressed me most forcibly. It would be hard in the whole category of human experience to find men differing in all important essentials more widely. One was a philanthropist, the other is a miser. One was benefactor, the other a stumbling block. One did well; the other is constantly doing harm. One helped his fellow-man – the other is injuring him. The death of Peter Cooper causes sorrow, even tears. The death of Vanderbilt would hardly cause a sigh of regret. And yet, of the two, Vanderbilt was and is the most powerful. . .Vanderbilt is the embodiment of the elements of monopoly. He uses his vast possessions for the oppression of the very men whose labor placed it in his coffers. In his person they have an admirable illustration of the effects of the monopolistic evil, an evil against which they should be strongly arrayed. Monopoly means the sacrifice of the rights of the many for the privileges of the few, the enrichment of the few at the sacrifice of the many. . ."

The reason conventional economics could not catch on with the activists of the time, I think, is that it could not paint a picture of an economic system where the malevolent economic power of someone like Vanderbilt could be naturally, systematically limited and kept under check. The man didn't have to be destroyed and sent to forced-labor camps, but he did need to face some sort of disincentive to carry on as he was doing.

of course it was a bitter irony that the activists then got duped into fighting for centralised state socialism, which has even fewer checks, and more opportunities, for the exercise of malevolent power. . .

I think Brad makes a mistake in evaluating Marx the political activist on the basis of his writings, very little of which were published during his time and even less of which was read.

Victorian England was very much fearful of a French style revolution. They saw themselves as the Roman Empire reborn, which is why they built neo-classical buildings and why I had to learn Latin at school. Fear that the slaves might revolt was very much part of that system of thought as well.

So then you have Marx come along and as far as the establishment is concerned he is saying, 'a revolution is coming and its a good thing too'. They don't believe him when he claims that the revolution is inevitable but they do think that one is quite possible unless something is done.

Marx was a German living in England. The English establishment was more than willing to believe that the continent was likely to be seized by revolution. They were predisposed to believe that Marx's predictions were correct with respect to Germany and France, come to that he was not so far wrong. But Britain was different, at least as far as they were concerned.

I don't think that the British social reformers would have had the same impact without the sneaking suspicion that Marx might just possibly be right.

Now, I am as anti-marxist a leftist as you'll find, but it seems to me that dispensing of the man's activism in the way you do is exceptionally broken. After all, the measure of an activist is not his theory, but the effect he has. Marx affected world politics, oft for the worse, occasionally for the better, for a over a century.

How many other activists can claim the same?

Revise and resubmit.

Marx looks pretty good these days. In China inflation is several points higher than GDP growth and far above nominal increases in rural income. In the United The culprit in both places seems to be unequal class representation in the political system that creates economic policies.

If you want to separate "economic analysis" from "institutional analysis" then you can dismiss Marxism as meaningless. But this is terribly naive. And unless you can explain why Bear Sterns was permitted to get "too big to fail" without resorting to some sort of class analysis.

This doesn't imply that we have a world revolution ahead, but it makes it silly to reject his framework for analysing class conflict because you think he is descriptively false in his depiction of reality.

? Second, Marx believed that businessmen continually extend the domain of captalism, and competition from poor workers in newly-incorporated peripheral regions puts a lid on the wages of labor. Hence inequality grows in the core, which should and in the end must trigger revolution. This seems to me to be largely wrong as well: it is very possible for the international economy, if properly managed, to balance up and not balance down as far as the level of real wages is concerned.

Excuse me? How can it be wrong? Its exactly what offshoring does today.

? Four, Marx believed that even though the ruling class could appease the working class by sharing the fruits of economic growth, they would not. They were trapped by their own ideological legitimation--they really do believe that it is in some sense "unjust" for a factor of production to earn more than its marginal product. Hence social democracy would inevitably collapse before an ideologically-based right-wing assault, income inequality would rise, and the system would be overthrown. The Wall Street Journal editorial page works day and night 365 days a year to make Marx's prediction come true. But I think they will fail.

They may fail in the long run - the same one in which we are all dead. For now in US its exactly how debate is carried. You are mixing your wish with reality again.

> Fifth, Marx believed that factory work--lots of people living in cities living alongside each other working alongside each other--would lead people to develop a sense of their common interest and of class solidarity, hence they would be able to organize, and revolt, and establish a free and just society in a way that they could not back in the old days when the peasants of this village were suspicious of the peasants of the next village. Here I think Marx mistook a passing phase for an enduring trend: active working-class consciousness as a primary source of loyalty and political allegiance was never that strong; nation and ethnos seem to trump class much more often than not.

Wrong again. Class solidarity of the buyers of labor is not even hidden - almost every job application has questions "Who was your manager - name/title? How can we contact him/her? Do we have your permission to do so?". And you can be absolutely sure that if your former manager is contacted and refers to you as layabout or troublemaker, nobody would offer you a job. Class solidarity of sellers of labor is broken quite deliberately - Taft-Hartley is just one example.

In general, you criticize Marx the political activist but you have very little understanding of the problems of the working man or woman in the world outside. Connect with reality.

You know, Barkley Rossler touched on this some, but...

One would be *really* wise to incorporate Critical Race Theory when thinking about Marx as applied to the US...

At the end of the day, one needs to build a model for creating consensus for inequality (and stability), in order to truly answer the points that Professor Delong brings up.

I'm interested to see respondents taking issue with Brad's objection to Marx on point (2). All he said was that it's not necessarily true -- in contrast to Lenin, who regarded it as completely wrong. In judging Marx as a political activist, it's appropriate to consider the judgments of successful political activists among his followers; not only Lenin but also Mao and others were of the opinion that in a world dominated by finance capitalism, the periphery was ripest for revolution.

It seems to me you are confusing what might might be called messianic Marxism with what Marx himself believed, and more moderate socialism influenced by Marx. I am puzzled as to the whole matter. If one does not think of Marx as a great prophet, but instead as a historical theorist--and, remember, he never held himself out as religious figure and indeed very much resented the idea, there are useful and valid ideas to be found in his work. And a great many errors as well, but of who is this not true?

Marx was a rationalist child of the enlightenment. You distort him--and your own thinking--by describing him in the terms that anti-Marxist christians, who regard him as a heretic (and often have a strong anti-Semitic strain as well), use. When Marx talked about "revolution", he wrote of a transformation of society comparable to the transformation which industrialism brought. In this, and how he imagined matters would fall out, he seems to have been too hopeful; it has proven much harder to unite the workers of the world than he imagined and the idea of a tyranny of the majority was foreign to him. He also failed to recognize the power of a messianic vision in times of privation, and how the dynamics of quasi-religious behavior would overrule reason in such times. Marx was, above all, a rationalist philosopher, and the power of messianic belief seems to have been lost on him.

In Marx's terms, the instruments of production, when owned by the working class, were not "capital" (he says as much, in similar words); if one uses the modern economic definition of capital in reading Marx, one misreads Marx. While industrial productive property (to use a clumsy, but neutral circumlocution) may in itself be neutral, it's very clear that business owners work very hard to replace employees with industrial property. So Marx might have said--wrote things very similar to--the idea that productive property could be a complement to labor. He also felt that capitalists would object very much to this, and he seems to have been correct in this. I am puzzled as to your problem--and indeed your reading--here.

"Marx believed that businessmen continually extend the domain of captalism, and competition from poor workers in newly-incorporated peripheral regions puts a lid on the wages of labor. Hence inequality grows in the core, which should and in the end must trigger revolution." This seems to me a fair description of the the motivation of a great many US voters these days. Do you not agree? You object, "It is very possible for the international economy, if properly managed, to balance up and not balance down as far as the level of real wages is concerned." This sounds remarkably like a false hope to me, and one based on the good will of people who we know have bad will. Isn't that at the root of the current financial disaster in the USA? The big money does not want "proper" management; the big money just wants to rule, and then gets angry--at the people whose lives it controls!--when it turns out that economics itself limits its power. Greed, and self-discipline and self-knowledge, are great enemies.

"Capitalism, Marx thought, unveils all--replaces masked exploitation by naked exploitation--and without its ideological legitimation, unequal class society cannot survive." Well, yes, but you are one of the ideological legitimizers. I do think, though, that consumerism and "economicism" is a poor substitute for the older legitimization of the Church and State and, indeed, we are seeing a return to the older ideas. Again, here Marx seemed to have been too much of a believer in the power of reason. Is your primary objection to Marx that he hoped for too much understanding from people?

"Marx believed that factory work--lots of people living in cities living alongside each other working alongside each other--would lead people to develop a sense of their common interest and of class solidarity, hence they would be able to organize, and revolt, and establish a free and just society in a way that they could not back in the old days when the peasants of this village were suspicious of the peasants of the next village." See "failure of the Second International during World War I", passim. On the other hand, now there is the net. To some extent, it seems to me economic analysis based on the emergence of industrial production is becoming invalid; that post-industrial production is rushing on us, and that promises to be very different. Dominated, in fact, by what are now called "network externalities". It does now seem that industrial capitalism is itself a phase of history and, if all is not swept away in ecological disater or political or religious reaction!--and what will follow on is going to be much more based on cooperation than industrial capitalism. Perhaps here Marx was again too optimistic, in that he hoped for a change that would take generations in his lifetime.

I do not understand your motivation in writing this. There is much to dislike in messianic Marxism, but you are not going to reason anyone out of it, especially since you show signs of not having properly read their St. Marx. If you want to people to abandon that view, you must offer an alternative, and be prepared to wait; surely you know this from your readings in history. Yet if you read Marx as only St. Marx, you are in error, for that is not how Marx wrote. That reading also cuts you off from a major intellectual source of social democracy, and closes you to a whole range of thought. In the end, it seems to me you write about Marx as though he were a heretic. That seems to me a not at all useful thing to do, and I wish you'd stop and rethink.

Marx was a rationalist who admired the United States and the Prussian and Piedmontese armies. Both considered very progressive at the time he wrote because the powers of the aristocracies in both were somewhat limited.

I think the best criticism of (popular) Marxism is to be found in Turgenev's Fathers and Sons. Even though the people he is crticizing were really "proto"-Marxists -- but they morphed into Bolsheviks without a hitch.

Actually, I don't understand Brad Delong's preoccupation with Marxism at all -- but then I'm not an economist.


Re: They saw themselves as the Roman Empire reborn, which is why they built neo-classical buildings and why I had to learn Latin at school.

What neo-classical buildings? Victorian architecture is mostly notable for its neo-Gothic style. The neo-Classical stuff came earlier, during the Revolutionary and Napoleonic era. As for Latin, that was a requisite subject of study for any educated person in Western Europe going all the way back to the fall of Rome itself.

Re: They may fail in the long run - the same one in which we are all dead. For now in US its exactly how debate is carried.

The standard of living of the American working class is vastly higher than what Marx would have predicted (even if gifted with omniscience about technological innovations). Note that the Wall Street Journal’s crusade to end the minimum wage, privatize Social Security etc,. has gone absolutely no where. Sure, we have been unable to extend the social safety net much in the last 40 years, but the other side has not been unable to eliminate it either.

Re: And you can be absolutely sure that if your former manager is contacted and refers to you as layabout or troublemaker, nobody would offer you a job.

But being fearful of lawsuits he will not do so, but will answer in polite generalities which is why most employers do not bother to contact previous employers except to verify the basic objective facts of employment dates and wage levels. Only if there’s a public record (a conviction for theft for example) will a previous employer be willing to offer a negative review of a past employee.

I think that Marx made subtle errors and a cardinal one, and Brad focuses on the subtle.

As far as the five points are concerned, they are not of "yes/no" variety, but of gradation.

1. Does capital substitute for labor? Of course, it does. However, without capital and increased productivity, the employer could not increase wages even if they were so inclined, so the equilibrium clearly changes when the wage increase is impossible for the employers to when it is undesired.

2. Did businessmen continually extend the domain of capitalism? The other day Brad argued that the industrial revolution in fact did happen... Did the possibility of moving the production or the labor influence wages? Of course. Still, for some reasons wages are not completely leveled between the areas, so Marx was both right and wrong.

3. Can capitalists "hypnotize" the masses as effectively as feudal lords? Clearly, Marx did not foresee theologians working in AEI in close contact with clergy of many denominations etc. Even so, a huge mistake. Feudal lords at occasion had to resort to naked power to much larger extend then capitalists; I do not recall any stories of capitalists impaling rebelling workers by hundreds.

4/5. Would capitalists successfully appease workers with higher wages and benefits? Would workers organize effectively? I think that here there is a tension with what will happen and what should happen. Philosophy as practical activity should enlighten the workers and make them hard to appease, so 4/5 could be viewed as postulates rather then prophesies of what would happen anyway.

So each of these points can be debated. Where Marx made a cardinal mistake was the issue of control in the society. To wit, someone has to do it. However you cut it, someone will be on top and this will be the elite. They can be warlords, clan chieftains, capitalists, or "Party leadership", or whatever, but just saying that proletariat should rule does not make it possible. So, we can create mechanisms for the proletariat to influence the ruling elite, but if we tweak them to make it impossible for other groups, like capitalists, to influence the elite too, the same tweak makes the elite impervious to the proletariat as well.

Libertarians for that matter suffer from the same contradiction. If you declare a certain kind of political outcomes totally unacceptable, you are on a slippery slope to a dictatorship of an unaccountable elite. In other words, if you do not tolerate some shit happening, it may be all shit. Kind of political Heisenberg principle, or, as Marx should put it, a dialectic contradiction.

A thought: standard of living of American workers during the time of Marx. My meager data comes from the landscape of central PA. It seems that there were two types of dwellings: manors of owners of iron works that exist till today, on the scale of larger McMansions although build to last (well, they do last!), and tiny huts of farmers, lumberjacks, colyers and mill workers, of which only foundations are preserved. These foundations, which are rather plentiful, indicate huge contrasts in the level of living.

Of course, there was also a lot of small farms. So it seems that the class divide was very sharp. One can ask: what workers got from such unequal division of "surplus value". Building and running small iron mills with the network of associated enterprises required the level of centralization and division of labor that a single family, or even 50, would be unable to achieve, plus a lot of specialized expertize. I imagine that even relatively simple activity like chopping wood and bringing it to the place where the charcoal was made was not that simple; you needed a careful surveying to build a networks of roads that would allow to bring the wood downhill from various slopes among very uneven terrain. Today one can see the stone substrate of those roads.

At some point all these iron mills, colyer works etc. were abandoned because iron was made in much larger mills and with anthracite coke rather than charcoal. Quite possible groups of workers could easily buy the abandoned forests and mills, except that at that moment the technological changes made them utterly uncompetitive.

It is hard to see what kind of decision/control mechanism could adequately replace the "manor owners". Workers were sometimes exploited too harshly, at least in their opinion, and some were resorting to what we would call today terrorism. "Molly McGuires" were sometimes killing or intimidating abusive owners and managers, and subsequently hiding in the hills, where National Guard would be looking for them, usually in vain. But it is hard to see how they could replace them.

Much later we got big companies which were run more by internal bureaucracies then by day-to-day attention of the owners, so one could imagine a change at the top of the structure from very rich owners or stock companies to "dictature of proletariat". But besides the problems like "how to prevent the new elite from being evil", the problem how to select among different possible kinds of economic activity was never resolved.

Imagine a group of central planners brainstorming and arriving at the following decision: now we will provide the working class of towns and villages with video games.

Not that it could not happen at all. After all, pin-ball machines were produced, although I strongly suspect that the idea was copied from the West. But to invent the concept? Or accept such an invention developed in the laboratories of the Ministry of Electronic and Electronic Machinery, Consumer Goods Division?

What somehow fallen outside the scope of class analysis is how to decide what people need? To given a small example, central planners in Communist Poland decided, after much thought, that lemons are needed throughout the year, and oranges only during the period that in different system would be called "Christmass Season". Pineapples, on the other hand, are worthless and never needed. Or another example, someone had to decide if manicure sets and nail clippers were produced and supplied, and the result varied.

Marx got only one thing right, that one he got very right: Religion is the opium of the People.

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