[WS:] And this was a MAJOR blunder, a demonstrably false prediction that normally would falsify a scientific theory. But then, as JK Galbraith aptly observed, Marx could not have foreseen the development of the corporation and Keynesianism, which were a real game changers that undermined the entire classical economic theory (not just Marxism).
I also feel that you downplay the role of social factors, especially the dramatic changes in social structure during the 20th century, on the dynamics of labor organizing. These were not just incidental changes due to growing affluence - these were a major overhaul - much of it planned and intended as social control (many feminists got it right) - of social structure.
Re:> In any case, the attachment to religion is not a new phenomenon, and does little to explain the relative passivity of the mainly secular modern working class.
[WS:] You got to be kidding. Organized religion was one of the MAJOR factors that affected labor organizing in the 20th century in Europe. Or to be more precise, one of the major factor that either spit the working class into factions (e.g. the Netherlands) or to undermine socialist effort to organize labor (following the encyclical Rerum Novarum http://en.wikipedia.org/wiki/Rerum_Novarum which was explicitly designed for this purpose). The role of the Roman Catholic Church in undermining labor militancy and labor organizing is second only to that of fascists, with whom btw the Catholic Church often collaborated.
Religion has typically played the role of the fifth column in labor organizing but that role and its effectiveness varied considerably. There is a good reason why reformers and revolutionaries of various stripes went after organized religion with vengeance - they understood its reactionary potential quite well. Even after it was seriously crippled, e.g. in Soviet bloc countries, organized religion, especially the Catholic Church, was still a nontrivial factor in fomenting anti-communist sentiments.
Wojtek