Did Karl Marx Predict the Financial Collapse of 2008?

RECENTLY I received an email from a friend containing only the following quote:

“Owners of capital will stimulate working class to buy more and more of expensive goods, houses and technology, pushing them to take more and more expensive credits, until their debt becomes unbearable. The unpaid debt will lead to bankruptcy of banks, which will have to be nationalized, and the State will have to take the road which will eventually lead to communism.

Karl Marx, 1867″

The relevant implication of this quote is that Karl Marx predicted the financial difficulties of 2008, and that these problems are a precursor to the fall of capitalism. I asked my friend about the email, and he said that it had been forwarded many times before he received it by people he felt were intelligent and reliable.

I was somewhat skeptical that Marx could have made such an accurate prediction 150 years in advance, especially considering that loans for the working class must be rather different today from what they were when he lived. But why does it matter whether this quote is true or false? Well, to begin with, some people will inevitably take it seriously, and it may distort their view of Communism, Capitalism, Marx, and the recent financial difficulties, in addition to perpetuating fear about the economic problems (which will only make them last longer). The belief that Marx really predicted these troubles so long ago will lend him a certain infallibility that he likely does not deserve. Furthermore, if the quote is indeed false then it provides an excellent example of how information of questionable validity spreads on the internet, and of how many people are willing to accept very remarkable claims without much show of skepticism.

Some google searching led me to a few blogs and message boards mentioning the quote, some of them containing skeptical comments. Apparently a handful of the emails going around attributed the quote to Marx’s Das Kapital, but one person claimed to have searched through the text of this work without finding it. Others commented on  the use of the word “technology”, claiming that it was out of place for Marx’s era. This claim seemed plausible, but on further research it became clear that Marx discussed technology and technological advancement with some frequency, and in a manner not wholly different than it is sometimes discussed today.

Finally I discovered one blog that attributed the origin of the alleged Marx quote to the satirical news site NewsMutiny with the memorable slogan “Satire for the wise. News for the dumb.” The NewsMutiny article which contained the quote was a fanciful one about American adults being forced to go back to pre-school in order to relearn skills like sharing that they forgot living in capitalist society. This fictitious tale is supposed to transpire after capitalism in America is replaced by Communism due to the financial problems of 2008. The article contains the following quote, which it attributes to Marx:

“The owners of capital will stimulate the need of the working class to take expensive, collateral loans to buy their condos, houses and technological products; and, at the end, these unpaid debts will result in the nationalization of the banks upon their bankrupcy, and so the state will be on the pathway to communism…”

Note the differences between this quote and the one above that I received via email, including the spelling of the word “bankruptcy” and the replacement of the word “technology” with the word “technological”. While it is certainly believable that the NewsMutiny writer invented the quote simply to serve the purposes of the article, there is no reason to be sure this is the case. It is possible that the author of the article also received it in an email and then simply incorporated the quote into the article (or even that the article was inspired by the quote that was being emailed around) .

UPDATE: I contacted the creator of the NewsMutiny article, who sent me the following message regarding the quote:

“I didn’t invent it. I got one of those emails myself, but I also know it has been published and attributed to Marx by a number of newspapers around the world over the past few months, so if its not Marx, the greater blame belongs on their shoulders, them being actual news sources vs. my homegrown satire site.”

I absolutely agree that we should not require or expect a satirical news site to verify the accuracy of quotations. I do, however, place blame on ordinary newspapers that spread misinformation due to a lack of careful fact checking.

The fact that I was not able to find a single person who could name the text or manuscript or letter where the supposed Marx quote originated indicates that the whole thing is likely a hoax or joke. Nonetheless, in an attempt to completely settle this question, I went on to the Marx & Engels Internet Archive and conducting thirteen queries (listed at the bottom of this article) on the Marx/Engels Collected Works, which is, according to the website, “the most complete publication of the works of Marx/Engels in English ever undertaken.” While Marx did an enormous amount of writing in his lifetime, and while not all of the archive is searchable, it appears that my searches covered the vast majority, if not all, of what are considered to be Marx’s most important works, including some of his letters and many of his economic manuscripts. The reason I felt that conducting so many searches was necessary is because Marx’s works are translated into English, and hence we should expect exact word usage to vary from translation to translation. Furthermore, since various versions of this quote exist, it is not clear which of them (if any) is the original.

I scrutinized every result from these searches, but found nothing that resembled either of the alleged Marx quotes above. While we cannot completely rule out the possibility that Marx said or wrote something similar to these quotations (which perhaps remains documented only in some obscure text), there is little reason to believe that the quote is legitimate. We know that people often make things up to further a political agenda, or even just for their own amusement. Given the information now available, I would place the probability at well less than 10% that the quote is genuine, and the ball is certainly in the court of the believers to prove that Marx really said or wrote it.

This case illustrates how difficult it can be to disprove certain kinds of claims. For example, to prove with certainty that there are no black swans it would be necessary to check every single swan that exists. And as it turns out (as Nassim Taleb points out in one of his books on finance) black swans do exist in Australia. Likewise, to prove with certainty that Karl Marx did not make a particular statement, I would have to start by checking every single written document of his that has survived. And even then, I could not be absolutely sure that I had checked them all, or that he had not written the comment in a document that was destroyed, or that he had not spoken the statement in an unrecorded speech. The only sensible solution in cases such as this one is to place the burden of proof on those making the remarkable claims, and to remain skeptical until verifiable evidence is provided. Obviously few people have the time to check every swan in the world, or to sift through every single one of Marx’s writings. But fortunately for you, there are the nuts like me.

The search queries I conducted at the Marx & Engels Internet Archive were:

“condos” OR “condo” OR “condominium”

“pathway” OR “pathways”

“nationalization” OR “nationalisation”

“technological” AND “loans”

“result in the nationalization of the banks”

“nationalization of the banks”

“nationalization of banks”

“collateral loans”

“capital will stimulate”

“more of expensive goods”

“more expensive goods”

“eventually lead to communism”

“technology” AND “houses”

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12 Responses to Did Karl Marx Predict the Financial Collapse of 2008?

  1. Sorry it took some time to publish your comment on my blog, it got jammed in the spam filter because of the included link. Anyway, nice research, it’s good to see someone who isn’t afraid to dig a bit deeper through something presented as true. Cheers!

  2. Adam Treanor says:

    Excellent read, thank you for clarifying this quote.

  3. nicosa54 says:

    thank you for thiis interesting ticket, if only peopple understand what you say 🙂 it s nice to vvisit this interesting blog 🙂

  4. Can you get rid of the irritating band down the page. It makes what you have to say dificult to read!

  5. clockbackward says:

    Thanks for the feedback. It appears there was a problem with the way the page rendered under certain browsers. I believe it is now fixed.

  6. RaiulBaztepo says:

    Very Interesting post! Thank you for such interesting resource!
    PS: Sorry for my bad english, I’v just started to learn this language 😉
    See you!
    Your, Raiul Baztepo

  7. PiterKokoniz says:

    Hi !!! 😉
    I am Piter Kokoniz. oOnly want to tell, that I like your blog very much!
    And want to ask you: what was the reasson for you to start this blog?
    Sorry for my bad english:)
    Thank you:)

  8. Earnefurf says:

    hm.. informative )

  9. Ingrid says:

    When I first read this quote I was quite taken aback as I believed it and found it amazing. Now, months later, I wanted to take a further look and fortunately I stumbled against your blog and I feel almot ashamed for having been so naive. You have taught me a lesson. Thank you

  10. loopmob says:

    Thanks a lot man

  11. Kiran Baddi says:

    Very Well researched! Though, I am a Marxist or a follower of Marx, I like your blog. The underlying theme – Everything that you find in Internet is not authentic and true, is one that impressed.. Keep up the Good work

  12. Cem Onur says:

    This is so interesting. Just like you, back in March 11, 2009, I received that email, and did the exact same thing 🙂 Came up with the exact same result. Kudos.

    Here is my take on the issue

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