Sunday, November 9, 2014

The need for socialism (2004)

From the April 2004 issue of the Socialist Standard

Marx states: “No social order ever perishes before all the productive forces for which there is room in it have developed; and new, higher relations of production never appear before the material conditions of their existence have matured in the womb of the old society itself” (Preface to A Critique of Political Economy).

It is difficult to show that this claim is correct, but that does not make it irrelevant. It provides us with a starting point to consider whether the material conditions for a socialist society exist today. It also suggests we look at whether capitalism has outlived its role as a progressive economic force in history. For if there is a solution to the problems we face today, certainly it is desirable to implement that solution. And if capitalism is not that solution, and has outlived its usefulness, then surely we are obliged, for our own sakes, to abandon the only economic system any of us has ever known. That is obviously a serious undertaking, and perhaps a frightening one, but one which has been successfully undertaken before, for example, to establish capitalism.

Does the current mode of production ─ capitalism ─ act as a fetter upon production? Are the material conditions which currently exist, sufficiently mature to support new, higher relations of production: socialism?

In 1992, Professor Vulimiri Ramalingaswami, Chair of the World Health Organization medical research committee, told the world that we have the ability to produce enough food for everyone. The ability and technology currently exists to feed, clothe, and house every human being on the planet. However, that ability and technology cannot be used to feed, clothe, and house billions of human beings. Even in supposedly wealthy countries such as Canada, about eight percent of the population had difficulty putting food on the table at least once in 1998-99, according to Statistics Canada. Yet Canada is a net exporter of food. And people freeze to death in the streets because they have no home. Yet Canada is a net exporter of lumber. Something is wrong with this picture: capitalism.

According to the World Health Organization, one child dies, and another is disabled, every twelve seconds, day and night, because they cannot afford vaccines costing about $10 (£5.25). The World Health Organization also tells us that in the United States, tuberculosis, an easily-cured disease of the poor, is increasing. Something is wrong with this picture: capitalism.

Although capitalism cannot provide necessary food and medication for our children, it  spends more than $350,000 (£184,000) every twelve seconds on arms (guns, bombs, jet fighters, aircraft carriers, landmines, etcetera). Socialists do not suggest that the arms budget should be used to feed and care for children and the rest of us. As desirable as such diversion may sound, we know that capitalism must spend that money to protect capitalists from other capitalists, and from the working class. Military spending under capitalism is not optional, it is an absolute necessity. Redirecting the money from war, to help the starving, the homeless, and the sick, is impossible. Something is wrong with this picture: capitalism.

The current material productive forces are in conflict with the relations of production. We should clarify these terms. “Material productive forces” refers to the things actually involved in production, such as workers, land, factories, mines, and transportation. The “relations of production” is somewhat more difficult to explain. It involves such things as whether production occurs, who owns the material productive forces, and who owns the results of production. Currently, the relationship between people and land, factories, mines, and transportation, divides people into two groups. One group owns those things. The other group must use its physical and mental labour to turn raw materials into finished products. Workers produce everything from food to education, from automobiles to hammers, from houses to hospitals, and from shopping malls to factories. We even produce the weapons used to kill each other in capital’s wars.

Those who own the means of production (basically the material productive forces excluding workers), control when, where, and how production takes place. If a factory owner decides to shut down a factory, the workers have no say in the matter. If the owners of an automobile manufacturing company decide to move their factories to Canada, or Mexico, or the United States, or Japan, or Taiwan, it is their choice. They own the means of production. If the owners of a food processing plant believe that they cannot sell their product for a profit, they have the right to shut down the plant. That right is theirs even if the processing plant produced all of the food in the world.

The products of the factories are owned by those who own the factories. The owners may have never been on the same continent as the factory, but they nonetheless own everything produced in the factory. Those who do the actual work have no legal right to the products they have produced. Those who own the means and the products of production, and who control production, are capitalists. The rest of us are the working class. With that understanding of material productive forces and relations of production, we can continue our examination.

We have developed our ability to produce to a level which easily enables us to meet everyone’s needs. But the relations of production-capitalism-disable us. Capitalism cannot accommodate that necessary production. By and large people do not go hungry because there is no food, but because they are, from the unalterable perspective of capitalism, unworthy: they cannot afford to eat. They cannot afford to eat because from capitalism’s perspective there is no reason to employ them and pay them. We have developed the material productive forces to such an extent that fewer and fewer workers can produce more and more of the things we need to live. But still, people cannot get the necessities of life.

Those of us who haven’t been hungry, who’ve always managed to scrape together enough money to purchase clothing and housing and medical care, may think that they are somehow excluded from these negative effects of capitalism. Don’t be so sure. Some of those people in Canada who had difficulty putting food on the table where members of what Statistics Canada euphemistically calls the “middle-class.” Canadian workers used to wonder why Japanese workers would not take all of their holidays. Now Canadian workers are doing the same thing, for the same reason. They are afraid for their jobs. More and more, workers are working an extra half-hour or an hour or more, before they leave work for the day, or they take work home. They are producing extra profit for the capitalists, but no extra pay for themselves. Even though fewer workers produce more, it isn’t enough for the capitalists.

For years we have been told that improvements in production should mean reduced working hours. Instead it means that many of us work longer hours for the same pay. Many others are not permitted to work because capital does not require their labour. This is more evidence that our productive ability has outstripped the ability of capitalism to accommodate our ability to produce.

The apologists for capital would have us believe that Karl Marx was wrong about (almost?) everything he said and wrote. But it is clear that “the material productive forces of society come in conflict with the existing relations of production.” Marx was right.

Most workers do not believe that capitalism itself is the problem. The media, which is a propaganda outlet owned and controlled by capitalists, encourages us to blame anything but capitalism. Most of us do not see through the propaganda, but most of us complain of capitalism’s effects. We attempt to subvert its actions for our own good, and we direct our dissatisfaction in a million directions. We grumble and complain about our lot in life. We busy ourselves with hobbies so that we don’t have time to think about our problems, or solve them. We try to change the laws; we see beauty in things which are not; and we philosophize that humanity is incapable of solving the problems of production. We invent religions which denigrate our humanity, and which offer a solution in the mythical, never-never land of the future. And sometimes we change religions, hoping for better.

We are encouraged to do all of these things because it blinds us to the source of our problems. But even with all the diversions, there are strikes and riots in the streets. As Marx wrote, all of these things are how we “fight it out.” Even the riots are used by capitalism. People are so frustrated by capitalism’s obvious failure that they lash out blindly with riots and terrorism. Rioting workers and terrorist workers make it easy to justify further repression of dissent. The rioters and terrorists are easy to attack, because they really have no solution, only rage.

Workers have good reason to be angry. Workers have no good reason to destroy useful things produced by other workers, or to hurt other workers. But in desperate anger, can one be surprised that some occasionally do? However, rage and desperation rarely clarify the facts. To solve the problems we need to understand why society does not work for us. We need to understand the structure of society, and the real enemy. Workers are boxing with shadows, and paying for the “privilege.”

Socialists are accused of ignoring the obvious improvements capitalism has wrought since it defeated feudalism. Our accusers are wrong. Socialists have clearly stated that capitalism was a necessary stage in human development. At its outset capitalism was progressive: it freed the burgeoning productive forces from the restraints of feudalism, and forced workers to produce wealth which would have been unimaginable before capitalism. Capitalism has evolved from an agent for development of the productive forces, into a roadblock. It is time to remove the roadblock.

The material conditions for new, higher relations of production have been carried in the womb of capitalism for too long. It is time for a birthing. It is time to release our ability to produce and to solve our problems, by providing the appropriate relations of production: socialism.
Steve Szalai

More on Profits (2014)

The Cooking the Books Column from the November 2014 issue of the Socialist Standard

Chris Dillow’s article on ‘Robot Dangers’ raises other issues about profits. Noting that ‘profits don’t come merely from being able to produce goods cheaply’ but that ‘you have to sell these goods’, he asks:
‘And if millions of people are out of work, who will you sell to? In theory, therefore, robots aren’t good for profits and might be disastrous for them.’
This is the old one about mechanisation causing continually rising unemployment. It hasn’t happened in practice, though it could theoretically. It doesn’t happen if capital accumulation continues and the extra demand for labour it entrains rises faster than the displacement of labour by machines. This is what has happened in the past. So, Dillow’s investors needn’t worry too much on that score.

After noting that technology has been eliminating many routine white-collar jobs in recent years, Dillow continues:
‘… this process has not been accompanied by rising aggregate profits. Office for National Statistics data show that returns on capital have fallen since the late 1990s. this is not merely because of the recession; profit rates were lower in 2007 than in 1997. In this sense, the IT boom has lowered profit rates.’
It is true that profits rates do tend to fall at the end of a boom but Dillow’s conclusion here seems rather daring, especially as aggregate profits are not the same as profit rates and can go up even if rates go down.

Adam Smith, David Ricardo, Marx and even Keynes discerned a tendency for the rate of profit to fall in the long run, even though they offered different reasons.

Marx’s explanation was linked to increasing mechanisation. He argued that as profit came only from that part of capital invested in productive wage-labour and that as mechanization meant that the part of capital invested in buildings, machines and materials grew faster, there would be a long-run tendency for the rate of return on total capital to fall.

Perhaps surprisingly (or perhaps not, as he mentions that he has read Marxian economist Andrew Kliman), Dillow takes Marx’s view:
‘According to the standard work on historic economic data (Mitchell’s British Historical Statistics), the UK’s capital stock rose by a factor of almost 11 between 1850 and 1938 whereas profits rose by a factor of less than seven. Ninety years of massive technical progress – the Bessemer process, electrification, combustion engines, telegraph, radios and so on – saw profits fall.’ (He means the rate of profit).
He apologises to his investor readers for seeming ‘a little dystopian’, but they needn’t worry too much about this since robotisation reducing the rate of profit to zero is only a theoretical limit and in any event would be years and years away. Well before that, they will have something more urgent to worry about – a growing socialist movement aiming to end the profit system altogether.

Dillow ends by posing a very pertinent question:
‘What’s at stake here is a matter of utmost importance: how can we ensure that technical progress benefits everyone rather than just a minority, while encouraging that progress?’
Easy. Make the means for producing wealth the common property of everyone instead of just a minority. Since people would then no longer depend on wages to live but would have free access to what they needed, robotisation wouldn’t deprive anyone of a living but would just reduce the work load all round.