Was Marx a Neoliberal?

F. Engels, by Akai Shizuku at DeviantArt.

I wanted to find something to say about the trillion-dollar trade deals between the US and China from the APEC meeting and between the Indian government and WTO, where the US has averted a longstanding crisis by backing down on its insistence that India stop its food security program, which subsidizes grain farmers to provide cheap wheat and rice to the—I think I heard 400 million on the radio—poor. But I'm as bad as everybody else when it comes to trade policy, and too much thinking about it makes my head hurt.

I did find something to share, though, by Friedrich Engels (vintage 1888) on Comrade Marx and his views on trade policy, which were decidedly on the liberal side in the 19th-century sense:

While recognizing that protection may still, under certain circumstances, for instance in the Germany of 1847, be of advantage to the manufacturing capitalists; while proving that that Free Trade was not the panacea for all the evils under which the working class suffered, and might even aggravate them; he pronounces, ultimately and on principle, in favor of Free Trade.

Mainly, of course, because the maximum development of capitalism will hasten the Revolution:

Only under Free Trade can the immense productive powers of steam, of electricity, of machinery, be full developed; and the quicker the pace of this development, the sooner and the more fully will be realized its inevitable results; society splits up into two classes, capitalists here, wage-laborers there; hereditary wealth on one side, hereditary poverty on the other; supply outstripping demand, the markets being unable to absorb the ever growing mass of the production of industry; an ever recurring cycle of prosperity, glut, crisis, panic, chronic depression, and gradual revival of trade, the harbinger not of permanent improvement but of renewed overproduction and crisis; in short, productive forces expanding to such a degree that they rebel, as against unbearable fetters, against the social institutions under which they are put in motion

(We now know thanks to Piketty and Saez that capitalist growth in and of itself can disrupt or inhibit the development of hereditary inequality and that it is during the slow periods that inequalities take root.)

But Engels makes merciless fun of countries like the United States maintaining a protectionist stance beyond the point where it is justified by the need to nurture a young industry:

Protection is at best an endless screw, and you never know when you have done with it. By protecting one industry, you directly or indirectly hurt all others, and have therefore to protect them too. By so doing you again damage the industry that you first protected, and have to compensate it; but this compensation reacts, as before, on all other trades, and entitles them to redress, and so on ad infinitum. America, in this respect, offers us a striking example of the best way to kill an important industry by protectionism. In 1856, the total imports and exports by sea of the United State amounted to $641,604,850. Of this amount, 75.2 per cent were carried in American, and only 24.8 per cent in foreign vessels.... 

The Civil War came on, and protection to American shipbuilding; and the latter plan was so successful that it has nearly completely driven the American flag from the high seas. In 1887, the total seagoing trade of the United States amounted to $1,408,502,979, but of this total only 13.8 per cent were carried in American, and 86.2 per cent in foreign bottoms.... they had sunk to $194,356,746. Forty years ago, the American flag was the most dangerous rival of the British flag, and bade fair to outstrip it on the ocean; now it is nowhere. Protection to shipbuilding has killed both shipping and shipbuilding.

And his remarks on Russia sound as if they were addressed to Vladimir Vladimirovich Putin:

It is hardly worthwhile to speak of Russia. There, the protective tariff -- the duties having to be paid in gold, instead of in the depreciated paper currency of the country -- serves above all things to supply the pauper government with the hard cash indispensable for transactions with foreign creditors. On the very day on which that tariff fulfills its protective mission by totally excluding foreign goods, on that day the Russian government is bankrupt. And yet that same government amuses its subjects by dangling before their eyes the prospect of making Russia, by means of this tariff, an entirely self-supplying country, requiring from the foreigner neither food, nor raw material, nor manufactured articles, nor works of art. The people who believe in this vision of a Russian Empire, secluded and isolated from the rest of the world, are on a level with the patriotic Prussian lieutenant who went into a shop and asked for a globe, not a terrestrial or a celestial one, but a globe of Prussia.