A prolonged depression of business, after the panic of 1837, with falling wages and unemployment, was just then about to precipitate the Revolution of 1848 in France and Germany, and similar but less violent distress in America. It must be remembered that Karl Marx wrote bis Communist Manifesto at the end of the year 1847, following ten years of the lowest degradation reached by the working people of England and Europe since the time of the Napoleonic Wars. Marx inverted this and made high profits (including interest and rent) the cause of low wages, and low wages the cause of stagnation and unemployment, because the laborers were not able to purchase back from the capitalists the products which the increasing efficiency of industry enabled them to create. He looked upon the capitalists’ profits as the moving force of industry, and upon high wages as the cause of low profits, and therefore the cause of stagnation of business and unemployment. Ricardo’s theory did, in fact, leave the wage-earner in the position of a commodity or machine, from whose labor the capitalist derived his profits and interest. Ricardo had taken for granted the institution of private property, but Marx resolved property into exploitation of wageearners through the power of the State, which, it was believed, created the rights of property. What he did was to take the theories of Ricardo, the founder of materialistic capitalism, and convert them from a political struggle between British landlords and capitalists, over the tariff and the rent of land, into a class struggle between all owners of property and all wage-earners, over the ownership of the whole product of industry. KARL MARX, the founder of materialistic socialism, is recognized by economists as one of the three or four greatest minds who have contributed to the progress of economic science.
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