Based strictly on his and Engels' Manifesto, Marx was spot-on about capitalism.
The beginning of The Communist Manifesto discusses the expansion of the bourgeoisie as an insatiable outward thrust. More than once in that volume, Marx (and Freidrich Engels) accurately predict the phenomena of globalization and hits upon more than one of the problems it presents.
"The need of a constantly expanding market for its products chases the bourgeoisie over the whole surface of the globe."
"The bourgoisie has through its exploitation of the world market given a cosmopolitan character to production and consumption in every country ... in place of the old local and national seclusion and self-sufficiency, we have intercourse in every direction, universal inter-dependence of nations."
"The bourgeoisie, by the rapid improvement of all instruments of production, by the immensely facilitated means of communication, draws all nations, even the most barbarian, into civilization ... it compels all nations, on pain of extinction, to adopt the bourgeois mode of production; it compels them to introduce what it calls civilization into their midst ..."
"Just as it (the bourgeoisie) has made the country dependent on the towns, so it has made barbarian and semi-barbarian countries dependent on the civilized ones, nations of peasonts on nations of bourgeois, the East on the West."
Disregard for a moment the backhanded racism inherent in some of those passages - I am referring to the use of "barbarian" to describe Chinese culture, among others - and consider what Marx and Engels prophecize in those passages, all taken from Part I of the Manifesto:
- The need for bourgeois (capitalist) society to constantly discover new markets. Just as in Marx's day, the United States has battled since the 1970s (and continues to battle) to maintain a strong presence in Asian markets. Including, ironically enough, a Communist-turning-Capitalist China.
- Free and open world trade, including the corporate migration offshore for their manufacturing needs. Marx also remarks upon the "universal inter-dependence of nations," which smells strongly of the economic concept of specialization - basically, narrowing the range of products produced in any given region, then relying on increased exports to pay for the requisite increased imports.
- Global Americanization. How ubiquitous is Coca-Cola in any city in the world? Nike? McDonald's? Marx predicts that capitalism "compels them to introduce what it calls 'civilization' into their midst ..." The similarities between what Marx foresees and the flood of American products abroad are striking.
Given that the phenomenon he predicts - globalization - has only recently re-emerged as an issue since he identifies it in the 1800s, I think it is far too early to pass judgement on the veracity of Marx's predictions about the fall of Capitalism; his observations of Capitalism in his day were certainly astute. Almost 150 years after the first printing of the Communist Manifesto, I see some unsettlingly accurate predictions in that work, and I see many things which were true during the 19th century, immediately preceding the Industrial Revolution, are still true today. Some of the things he describes as deplorable in the rise of capitalism - I assume that globalization as he describes it refers primarily to the Open Door Policy in China and similar foreign policies - are evocative to me, standing here at the start of the 21st Century, as the world continues to struggle with capitalism.
Thus rather than be wrong ... the beginning of Marx and Engel's Manifesto has only recently been reinforced as dead right. It could be possible that they have accurately predicted the rise of the proletariat, and it just hasn't happened yet. Although I personally doubt the possibility of such widespread revolution, I see areas in which Marx is now correct. It could be that the depressions of the 1920s were not the necessary catalyst for Marx's social change, or perhaps that capitalism was not yet global enough. That, however, is outside the scope of my argument - I am not an economist. I merely wanted to identify how correct Marx and Engels have been so far.
Forgive me if I elect to reserve judgement on the rest of his predictions for now.
Noung offers helpful historical background: ... Marx was also describing contemporaneous circumstances. The world on the eve of the First World War is often considered to be as globalised as it is today, and only Europe's thirty-year catastrophe derailed this process. Other parts of this are borrowed from earlier economists, i.e. Adam Smith and the 'universal inter-dependence of nations'. Marx was, to my mind, more a skillful analyst of capitalism than a far-sighted prophet.
Europe's "thirty-year catastrophe" as a delay, rather than a proof of Marx's error, seems a more fitting evaluation to me.
True: Marx was not some far-sighted visionary. However, one is presented with a multitude of evidence supporting his status as not only an astute observer of capitalism in his time, but a man posessed of foresight enough to identify the trend and pattern of capitalism in so precise a manner that his statements backed, I presume, with evidence such as the handling of the East India Tea Company and European/American foreign policy towards China and Japan in the 1800s are still true today. Bear in mind these same statements are being made now only after the much less subtle evidence we have in the 21st century: Coke signs everywhere from Timbuktu to Tibet, factories spread from China to Mexico, cable television invading homes in Nepal. Not only did he identify economic trends within capitalism, but social ones as well - the necessity for "bourgeois" culture to impose itself upon every other culture it encounters is a phenomenon which I am inclined to credit Marx for predicting rather than Adam Smith or any other great thinker of periods previous, although it is true that Marx did borrow from many people between Aristotle and our buddy Adam, including his contemporary Hegel.
Thanks to Noung and also Catchpole for their comments.