Social Development. The Erfurt Program had faith-
fully reflected the classic Marxist belief that capitalist
society was moving towards an even greater polariza-
tion between the propertied and propertyless classes.
Capital was becoming concentrated in fewer and fewer
hands; the middle class was disappearing; the prole-
tariat, and its recruits from the impoverished middle
class, faced “misery, oppression, servitude, degradation
and exploitation.” The whole process was furthered by
periodic industrial crises, and would culminate in the
“collapse” of the capitalist system and a violent revo-
lution. Very soon after the Erfurt Congress, however,
academic economists such as F. G. Schulze-Gävernitz
and Julius Wolf began to observe that this prospect
was unlikely to be fulfilled. At first Bernstein tried to
refute their arguments, but a few years later found
himself forced to agree with much of what they said.
Was the Marxist view correct? “Well,” said Bernstein,
“yes and no” (Bernstein [1909], p. 41). The growth of
concentration and monopoly could be accepted “as a
tendency”—indeed many of Marx's theses, such as the
falling rate of profit, overproduction, and crises, etc.,
were empirically observable facts; but strong social
forces existed which falsified Marx's general picture
of society polarized into two bitterly embattled classes.
Bernstein pointed out, with a wealth of statistics from
Germany and England, that although large-sized en-
terprises were increasing in numbers faster than others,
the numbers of small and medium-sized enterprises
were not decreasing but increasing also. There was no
tendency for the middle class to disappear; indeed the
number of propertied persons was actually growing.
Similarly, when it came to the theory of crises and
collapse—the other main plank in Marx's prediction
of revolution—Bernstein agreed that crises were an
inherent feature of capitalism, but noted that they had
become rarer, shorter, and milder.
Moreover, as with the development of class rela-
tionships, Bernstein attributed this phenomenon to the
emergence in capitalism of certain counter-trends—the
growth of the world market, improvements in trans-
portation and communication, more flexible credit
systems, and the rise of cartels—which made it un-
likely, in his view, that “at least for a long time, general
commercial crises similar to the earlier ones” would
occur (ibid., p. 80).
