Industry 4.0: The Digital German Ideology

How Karl Marx helps us to understand Germany’s new digital ideology

BY CHRISTOPHROSER, ALLABOUTLEAN.COM, CC BY-SA 4.0, VIA WIKIMEDIA COMMONSBy ChristophRoser, AllAboutLean.com, CC BY-SA 4.0, via Wikimedia Commons

What Is Industry 4.0?

In the past five years, there has been much talk in the world of digital media about “industry 4.0” and the “industrial Internet” as constituting the fourth industrial revolution. Especially in Germany, a vivid public debate has emerged about “Industrie 4.0” that has featured government strategies and investments, the formation of an industry interest group (Plattform Industrie 4.0), public debates, research projects, a multitude of publications, etc. German corporations involved in industry 4.0 include SAP, Siemens, Software AG, Wincor Nixdorf, Psipenta, Seeburger, CA, Bosch, Felten AG, KUKA, and Festo AG.

Industry 4.0 propagates the combination of the Internet of Things, big data, social media, cloud computing, sensors, Artificial Intelligence, robotics, and the application of the combination of these technologies to the production, distribution and use of physical goods. Cyber-physical systems are embedded computing systems: Chips are embedded into manufactured goods so that they can be networked and connected to the Internet. The networking of humans through social media and the generation of big data is extended to machines so that networks of communicating machines are created. In the most extreme case, industry 4.0 means that a good is fully automatically produced, delivered, used, repaired and recycled without human intervention through the networking of different technologies over the Internet.

The Fourth Industrial Revolution?

A study by the Fraunhofer Institue for Industrial Engineering claims that “the fourth industrial revolution will have revolutionary impacts on production in Germany”. Such claims are not just technological determinist (technology is seen as determining economic development) and ignore aspects of class struggle and political economic development, but also proclaim a revolution before it has taken place. The idea of a technological revolution comes in this version before actual technological and economic developments. Industry 4.0 is the attempt to talk a new technological paradigm ideologically into existence.

Industry 4.0 promises economic growth: The German Federal Ministry for Economic Affairs and Energy estimates that within a ten-year period there is a market potential of industry 4.0 technologies (Internet of Things, digital intelligence, robotics, cloud computing) in Germany of almost 45 trillion Euros. The figure is based on surveys. It neither takes into account investment and maintenance costs that reduce actual profits nor that industry representatives tend to use surveys as marketing tool and therefore tend to overestimate potential positive economic effects.

The Political Economy of Industry 4.0

Germany has a somewhat less financialised and significantly more manufacturing-based economy than the USA and the UK. Given that Germany and Europe simply cannot compete with the US Internet economy, German industry’s goal is to become the capitalist leader and innovator in respect to a different kind of digital technology that makes use of the country’s competitive advantage in the export-oriented manufacturing of cars, machinery, chemical and pharmaceutical products, electrical equipment, metals, plastics and rubber products. As part of the Lisbon Strategy, the EU tried to catch up and overtake the USA’s world leadership in the development of digital technologies until 2010. This strategy failed. Germany now takes a different approach and wants to digitise and network its manufacturing in order to compete with digital giants such as Google.

Since the start of the new world economic crisis in 2008, German capitalism’s general profit rate (the relationship of profits to investments in the total economy) has decreased from 27.4% in 2008 to 24.3% in 2016 (calculation based on data from OECD STAN). Whereas the profit rate in the information and communication sector tends to be well above the general profit rate, the German manufacturing sector’s profit rate tends to be well below the general profit rate. Given that in Germany the traditional ICT sector’s profit rate is high but its overall share of the economy low, it does not yield enough potential for the large-scale accumulation of capital. The German manufacturing sectors has a much larger absolute size than the ICT sector, but a low profit rate. Industry 4.0 is an expression of German capital interests’ strategic hope that the digital sector’s high profit rate can be transferred to the manufacturing sector and that thereby the general profit rate’s fall and squeeze can be overcome.

Given that total wage costs and labour intensity are relatively high in German manufacturing, there is a material interest that German capital tries to use industry 4.0-technologies for replacing human labour and reducing its role in the production process. Industry 4.0 is the newest attempt of class struggle from above in the realm of technology.

The New German Ideology

In 1845/46, Marx and Engels wrote The German Ideology, in which they criticised some of the main German philosophers of their time, such as Ludwig Feuerbach, Bruno Bauer and Max Stirner, for the neglect of capitalism. “It has not occurred to any one of these philosophers to inquire into the connection of German philosophy with German reality, the relation of their criticism to their own material surroundings”.

170 years later, we live in the time of digital capitalism that has created its own peculiar forms of ideology. Industry 4.0 is the new German ideology, the German digital ideology. It has not occurred to any of the consultants and ideologues of industry 4.0 to inquire into the connection of German ideas with German reality, the relation of their ideology to their own material surroundings. They propagate industry 4.0 as the new capitalist panacea, a digital version of God that is said to solve all economic (and other) problems. The actual contradictory class structure of capitalism and its diverging interests are thereby ignored.

Capitalism is the struggle between capital and humanity. In digital capitalism, capital aims to appropriate digital machines as instruments for political control, economic accumulation, and ideological manipulation. Social struggle in digital capitalism is one over the control and shaping of digital machines. Only if humanity appropriates fixed digital capital, can we be confident that digital technologies will become disentangled from fetishist and ideological forms (such as industry 4.0) and serve humanity as a whole.