First, we should study capitalism in the context of our era

Even at the beginning of capitalism, when it was full of vigour Karl Marx and Frederick Engels predicted that capitalism was not permanent. Lenin also discovered capitalism’s weakness when the first signs of its corruption and cracks were exposed. He foresaw the possible “labour pains” for a new society and concluded that capitalism had developed as far as it would go while the dawn of socialism became to light. His prediction was correct. The world has changed.

However, capitalism in the early 21st century has seen new phenomena which are different from what has gone before. Capitalism proves to have a certain vitality. Its current inner contradictions are not so drastic as to lead to a revolution.

Confronting this situation, some compared it to the prediction of the Marxist and Leninist viewpoint. They maintained that the prediction of the sunset of capitalism was too premature and the explanation of its disappearance was wrong. Others regarded current changes in socialism and capitalism as a sudden inspiration of history.

In fact, all manifestations of modern capitalism can be interpreted if we take into account historical experience and current affairs. Capitalism still exists. It is not difficult to understand. Capitalism has existed for nearly 450 years. That is not a long time compared with feudalism and slavery societies, so it would be groundless to hope for the quick disappearance of capitalism.

It should be noted that we do not fully evaluate the flexibility of the capitalist economic structure and capitalist business people. Modern capitalism has gone far in the process of social globalisation and economic unity. The regulation of economic processes by private capital adheres to regulations by the capitalist state through various laws, and administrative, economic and social tools. A special super-nation which can regulate capitalism’s political and economic contradictions has been established and, although it is not complete, it has helped solve some problems of capitalism.

That is why we should consider both aspects when evaluating modern capitalism. On the one hand, capitalism’s disabilities and contradictions still exist. But on the other hand, its capacity to develop, improve, and adapt itself to the new situation is obvious.

Second, regulation of capitalism

First of all, we should agree with the regulation of its form and range. It is impossible to confirm that currently, capitalism’s ruling range is narrowed. After World War 2, the old colonial system collapsed due to international political and economic changes, particularly because many colonial and dependant countries won political independence.

However, imperialist countries realised a neo-colonialist policy. Outwardly, they recognised the political independence of their former colonies but, in fact, they used all their tricks to indirectly control them economically and politically. Capitalist countries used tricks such as exporting goods and capital and providing aid and loans to penetrate developing countries. In reality, the range of capitalism has widened, particularly after the changes in the former Soviet Union and eastern European countries. Of course, the current control and domination of capitalism is quite different from the past.

Worthy of note is that the regulation to prolong the existence of capitalism, particularly economic regulation, is the intervention of the capitalist state in socio-economic processes to facilitate the development of production forces and the adaptation of production relations. This regulation springs from the capitalist system itself. Capitalism must try to partly solve contradictions between production and production relations and their consequences inside society.

Meanwhile, we should also understand that capitalism must regulate itself for external reasons such as changes in international conditions, the emergence and development of socialism, and the collapse of the colonial system.

Regulation of capitalism is closely connected to the current scientific and technological revolution. The bourgeoisie and their government must solve key economic issues to make their products more competitive; improve production efficiency; reorganise the huge state-run sector to expand its competitive environment; reduce social costs (even essential costs); and encourage capitalist principles to operate effectively.

These changes show the world capitalism’s trend to adapt the new situation.

Third, major contradictions in capitalism

An important contribution of Marx was that he clearly pointed out major contradictions in capitalism, including the contradiction between capitalist private possession and the highly socialized production force. It is correct that there are critical contradictions in a capitalist economy and serious antagonism in its society, but up to now, we have not been able to affirm that these critical contradictions are regular or on the increase. Certain changes have been seen in aspects of both the above mentioned major contradictions.

Changes in the form of ownership: The development of private ownership from the time of free competition has been replaced by a considerable planned economic mechanism. We should acknowledge modern capitalism as a reality in which the production force has developed and the traditional forms of production relations have mingled with the state monopoly as a result of the socialization of the production process. This is the complicated unity between regulation and the market.

The capitalist ownership of production means has changed considerably in the process of economic globalization. Production relations in capitalist countries have been socialised, so, to a certain extent, capitalism has further adapted to the development of the production force. Currently, the contradiction between the socialist characteristics of production and capitalist private ownership still exists and is sometimes acute, but the contradiction is no longer as clear-cut as in the past. In modern capitalism, the bourgeois state owns and distributes 30% - 60% of the national income. This is not simply private ownership, but to some extent, it has a socialist nature.

However, we should know that, although capitalism has won certain success in regulating its economics, this success is only temporary. The inherent contradictions in capitalism remain unchanged as was confirmed by the recent global financial crisis.

Changes in working people: Different from those in the past, most workers in developed capitalist countries are paid according to the value of their labour. This is because the bourgeoisie can use part of its super profit to bribe them and because the well-organised workers’ movement has become a strong force against the bourgeoisie. In order to increase production, capitalism must boost consumer demands among people. This has led to considerable changes in the ranks of the working classes in developed capitalist countries. Poverty remains but is not common among hired workers, therefore, the working classes do not directly feel the oppression of the capitalist regime.

Visually, modern capitalism wears a new cloak which partly covers its innate disabilities. However, it remains capitalism with a social nature full of injustice and contradictions. It should be affirmed that current changes inside capitalism and its temporary success in the readjustment process create factors and prerequisites for a future society which will deny capitalism. This is the law of social development.