Selfishness, Greed and Capitalism

The rich get richer and the poor get poorerclass. He becomes a pauper, and pauperism develops morerapidly than population and wealth’ (Marx and Engels2002: 227, 233). Some argue that Marx drew back from thistheory of ‘absolute immiseration’ in his later work. In herhistory of economics, The Grand Pursuit, Sylvia Nasar (2012:39) notes that a ‘surprising number of scholars deny thatMarx ever claimed that wages would decline over time orthat they were tethered to some biological minimum. Butthey are overlooking what Marx said in so many words onnumerous occasions.’ At the very least, it is clear that Marxexpected the proletariat’s living standards to decline andthat this would ultimately lead to revolution.The eagerness of some Marxists to reinterpret theirhero’s words almost certainly stems from the fact that theimmiseration theory has been soundly rebutted by history.Every capitalist country has seen a dramatic rise in realwages across every income group since Marx’s day and thisincrease has continued during the recent period of alleged‘neo-liberalism’. Office for National Statistics data show thatdisposable incomes in Britain rose every year between 1970and 2009 with the exception of the period 1973–77 and twosmall blips in 1980–81 and 2006–7 (Carrera and Beaumont2010:3). By 2009, GDP had more than doubled and householddisposable income was almost two-and-a-half times higherthan it had been in 1970 (in real terms). Figure 2 shows thatdisposable incomes (solid line) in this period rose slightlyfaster than GDP (dotted line).How was this income distributed? Figure 3 shows substantialreal-term increases for all five income quintilesbetween 1977 and 2011/12, with the incomes of the bottom67