Karl Marx

In contrast, Karl Marx in his Das Kapital reasoned that workers would be exploited by any capitalist, or factory owners, for the capitalist system provides an inherent advantage to the already rich and a disadvantage to the already poor segments of society. The rich would get richer and the poor would get poorer. Furthermore, the “capitalist” is always in a better position to negotiate a low wage for his workers, he argued. One of his notable and more contentious theories – the labor theory of value – claims that the value of a good or service is directly connected to the amount of labor required for its production. Interestingly, Karl Marx also had his own drastic, political ideas that were far away from those of Adam Smith’s.

Adam Smith
Marx posited that the two classes in a society – the bourgeoisie and the proletariat – will forever remain stuck in their respective classes because of the very nature of capitalism. The wealthy capital-owning bourgeoisie not only owns the factories but dominates the media, universities, government, bureaucracy, and, hence, their grip on an elevated social status is unchangeable. In contrast, the poor, working class, or the proletariat, lacks any effective means of having just recompense for their hard labor. The remedy for this trouble, in Karl Marx’s view, was for the proletariat to revolt and create a new social order where there would be no distinction between segments of society; there would be no classes as such. Collective ownership of all capital for production would ensure, Marx suggested, an equitable distribution of wealth.
While Adam Smith contended that the most ideal economic system is capitalism, Karl Marx thought otherwise. Adam Smith also opposed the idea of revolution to restore justice for the masses because he valued order and stability over relief from oppression. Marx strongly adhered to the idea that capitalism leads to greed and inequality. Inherent to the idea of competition is greed, opined Karl Marx,