Wednesday, February 11, 2015

Half Marx: Flanders Flounders (2012)

From the November 2012 issue of the Socialist Standard

Whenever capitalism gets into an economic crisis there is a revival of interest in Marx, and not just amongst critics of capitalism. So it was to be expected that Marx’s ideas should be examined in BBC Economics Editor, Stephanie Flanders’ recent three-part programme for BBC2 and the Open University: ‘Masters of Money’.

She examine first the ideas of Keynes (who advocated government intervention to save capitalism), then the obscure and slightly batty Austrian School economist Friedrich August von Hayek (who wanted to free capitalism from all government interference, which not even his great admirer Thatcher dared to try). Marx’s turn came last, on 1 October.

Flanders got two things right. First, that Marx analysed capitalism as an economy that pitted two classes – profit-seeking capitalists and wage-dependent workers – against each other. Second, that Marx saw capitalism as an inherently unstable system under which economic crises and downturns were bound to occur from time to time.

But she got it wrong on two other, crucial points. First, her claim, repeated several times, that Marx had offered no alternative to capitalism. Second, she made Marx have an “underconsumptionist” (workers can’t buy back) theory of capitalist crises.

Marx’s alternative

It is true that Marx did not believe in drawing up recipes for the cookshops of the future, but he did describe the basis of the society he thought was going to replace capitalism: “an association of free men, working with the means of production held in common” (chapter 1 of Capital); “a co-operative society based on the common ownership of the means of production” (Critique of the Gotha Programme); “abolition of private property”, “the Communistic abolition of buying and selling”, “the conversion of the functions of the State into a mere superintendence of production” (Communist Manifesto); “abolition of the wages system” (Value, Price and Profit). In short, a classless, stateless, moneyless, wageless society based on the common ownership of the means of production.

It was probably inevitable that what happened in Russia and Eastern Europe would be seen as a failed attempt to replace capitalism, with disastrous results. So Flanders went to visit a former Stasi prison in East Berlin but, to be fair, she didn’t overdo this and at one point hinted that Marx might not have approved. Indeed he wouldn’t. He would surely have recognised this as a form of capitalism, based on the exploitation of wage-labour by a minority which controlled the state – state capitalism.

What Marx did not say

According to Flanders, Marx’s theory of crises was that they are caused when the total income of the workers falls too low so that they are unable to buy all the products that the capitalists want to sell to them. So capitalism is in a bind: capitalists seek to maximise profits and this can only be done at the expense of wages. But, if wages are reduced, so is the market for goods. On the other hand, if wages go up, the market does expand, but profits go down, reducing the capitalist’s incentive to invest in production.

The trouble is that this simplistic theory has been put forward by people who regard themselves as Marxists. They argue that the crisis of the 1970s was caused by workers pushing up wages and so squeezing profits and that this provoked a fightback by Reagan and Thatcher in the 1980s on behalf of the capitalists. This, in turn resulted in the workers’ share in national income falling. For a while workers’ consumption was kept going by their going into debt, but when their credit ran out, the crisis caused by a fall in total workers’ income broke out. This is the view put forward, for instance, in Richard Wolff’s widely viewed video When Capitalism Hits the Fan.

Flanders accepted this as Marx’s view. But it wasn’t. This theory is based on the fallacy that capitalism is a system geared to meeting consumption and that the market is made up of paying demand for consumer goods only. In fact, the market is also made up of paying demand for producer goods (machinery, raw materials, intermediate goods and energy) so what the workers can’t buy the capitalists can. It is this business reinvestment of profits in expanding production that is the driving force of the capitalist economy, and it is variations in this – not in workers’ consumption – that causes capitalism’s instability.

Capitalism is a system geared to capital accumulation which falters, as now, when the prospects for profit fall, resulting in capitalists choosing not to spend their share of national income. This inevitably happens sooner or later in a boom when capitalists in one key sector of the economy in their pursuit of profits overproduce in relation to the demand for their products and this has a knock-on effect on the rest of the economy, leading to a more general economic downturn.

The end of capitalism

Flanders also talked of Marx arguing that economic crises would get worse and worse and would eventually lead to, as she put it, “the total collapse of capitalism”. It is true that in the Communist Manifesto, a political manifesto rather than a work of economics and written before Marx undertook his detailed study of capitalism, he did refer to “more extensive and more destructive crises” but never expressed the view nor expected that capitalism would collapse of its own accord through its inherent economic contradictions. He saw capitalism coming to an end, but through the political action of those he called its “gravediggers”, the exploited working class. In other words, capitalism had to be done to death. It still needs to be.
Adam Buick

The Sweet Life (1961)

Film Review from the January 1961 issue of the Socialist Standard

La Dolce Vita, the Italian film now showing at the Columbia and the Curzon, is worth attention. The action is centred in Rome over seven days and nights (a sly dig at the story of creation?). The opening sequence sets the scene for the bitter, searing and uncompromising revelation of our diseased society. A helicopter is carrying an effigy of Christ low over Rome followed by another occupied by a newspaper reporter and photographer. Subsequently we learn that these two are attached to a scandal-mongering tabloid but we surmise that in the meanwhile that this is a stunt and that the occasion is one of the not infrequent religious holidays. Suddenly we see St. Peter's Square below. Thousands are gathered receiving benediction from the Pope. We are left in no doubt of the relationship of the events—two stunts both concerned only with a cynical exploitation of ignorance, fear and uncertainty.

That evening we see the same reporter in one of the more exclusive night-clubs of Rome smelling out sensation and scandal and noting the useless itineraries of the notables of "society". Eventually he finds himself alone in the company of a rich young heiress who takes him to her palace (the term is used literally) in her fabulous car. There they encounter two prostitutes. The rich young lady, sensing a common bond with one of these (for as we are made well aware, they are two opposite sides of the same coin) offers to take her home. The contrast between the affluence of the rich and the dismal quarters of the prostitute is driven home cruelly. The more so since the rich young thing, weary no doubt of the boredom of her parasitical existence decides to fornicate with the young man in the prostitutes' own bed, suffusing herself, as she imagines with the sensuous pleasures of promiscuity. Of the coarseness, the soliciting, the squalor, the pimps, the degradation, she knows—or wants to know—nothing.

Another episode is in an altogether different vein. A little boy and girl claim to have had a vision outside their home and to have spoken to "Our Lady". The credulity and hysteria which follow lay bare the blind belief and ignorance which go with religion. We see the maimed and crippled gather for succour. Others come out of curiosity, anxious not to miss any possible "modern" miracles. All this is exploited shamelessly by the methods of modern mass communication. The pent-up frenzy and the latent violence that is its accompaniment bursts forth at the end into the immolation and despoilment by the crowd of the tree where the vision is said to have appeared. Symbolic this of the brutality and violence underlying blind faith and belief so characteristic of our time.

Another episode takes us into the palace of a rich aristocrat where a party is taking place. The utter depravity and stupidity of these people are hammered home in scene after scene. Lechery, promiscuity, avidity, inanity are all ruthlessly exposed. We are never allowed for an instant to forget that these people are possessed of enormous wealth and resources. The great disparities of wealth ownership so characteristic of capitalist society are made clear for all to see. These people are portrayed for what they are—useless, parasitic, diseased.

The final orgiastic episode may be said to crown this unsparing condemnation of hypocritical capitalist morality with one code for the poor and one for the rich.
Max Judd 

Irish eyes (1982)

Book Review from the July 1982 issue of the Socialist Standard

Frank Faces of the Dead by Richard Montague, New Horizon

This short novel (190 pages) set around a street riot in Belfast which later develops into a bloody battle between the two IRAs (official and provisional) and the British army is essential reading for an understanding of the situation in Northern Ireland.

Written by a socialist, it succeeds well in introducing the socialist argument (through one of the characters, Nora Quinn, a nurse in a Belfast hospital) without turning the novel into a political tract. But even without this the basic story, bringing out the utter futility of violence, is itself an illustration of the socialist case.

Here, for instance, is how the "hero", Johnny Cairns of the Official IRA, recalls one of Nora's arguments, in the course of the battle:
Freedom . . . freedom . . . FREEDOM!
Before man can be anything, Johnny, Catholic, Protestant, English, Irish, black or white, freeman or slave, he must be LIVING—not dead!! In order to live he needs food, clothing, shelter, Johnny, and in order to live in freedom, he needs free and equal access to these things. Will your Luger create the conditions of abundance for freedom, Johnny? Is your gun the great revelation? The precursor of universal knowledge? Have you revolutionised the gun? Changed its historic role of enslaver to that of emancipator? Is it to be the voice of the people with the alchemistic power to make freedom, the fruit of knowledge, grow on the barren boughs of ignorance and acceptance?
And how Nora explains the historical background to a young recruit to the Provisional IRA:
Dermot, I don't want to go back into history; suffice it to say that the propertied class in Ireland, at the turn of the century, the established capitalists in the North and their fledgling class-brethren in the South, were politically divided. In the South, they wanted control over their own political affairs in order to legislate conditions in which they could nourish their developing capitalist economy—they needed to restrict competition with tariff walls and import quotas.In the North, on the other hand, capitalism was well established, developed against the British home market. So the Northern capitalists needed to maintain the link with Britain to sell their wares and the Southern capitalists needed protection from British capitalism.
The workers, North and South, because they mistakenly associated their interests with the fortunes of their masters, were lined up behind the capitalists in their respective areas. The Southern capitalists rallied the people there behind them by appeals to patriotism and the notion that if they had their own government they would be free. The Northern gentlemen achieved their end by exploiting historical fictions and blatantly promoting religious bigotry.
There's more too on the futility of leadership and the need for socialist knowledge, on the state capitalist nature of Russia and nationalisation.
Adam Buick


Richard Montague's dedication in the book.

Patriots without countries (1982)

Editorial from the July 1982 issue of the Socialist Standard

Among the more disturbing and threatening features of the Falklands crisis has been the way in which it has been bolstered by a mass of patriotic nonsense. So intense has this been, that to stand out against it has been something of an act of courage—and this in a country whose government claimed to be fighting for human liberty. So receptive have British workers been to the nonsense that at one stage it might have been feared that they would swallow any deception provided it came from "their" side. It was reminiscent of the lurid deceptions about atrocities committed by German troops at the beginning of World War One—of babies tossed onto Prussian bayonets, of buckets-full of eyes torn from Belgian heads.

Patriotism is not supportable with fact and reason but by deception and prejudice. That is why it is so quickly inflates into mob frenzy, bullying and repression. In the case of the Falklands, workers were told that the British forces were sent out to protect the 1,800 Islanders. In the light of history of the ruthless, instant repression and murder of millions of people by the governments of capitalism, when it suited their interests to do so, this sudden concern for the fate of the Falklanders is a sick joke. It needs very little thought to dismiss it as a cruel deception which will cost many working class lives and much suffering.

The Falklands struggle is actually a dispute over the possession and exploitation of mineral resources, trading routes, the political pressures in states under severe economic stress and the wider, long term strategic aims of the Argentine ruling class, which present a threat to an established power. Whatever the outcome of this struggle the lives of the mass of people in Argentina and Britain will not change. In other words their interests are not involved; their suffering and their deaths are contributions to the fortunes of their respective ruling class. This goes too for the people of the Falklands. The war is not worth a moment's effort on the part of the working class, not the spilling of a single drop of their blood.

Workers have no interest in the Falklands because, in spite of the mouthings of politicians and media hacks, they have no country to fight for or to protect. Their "way of life" is the daily grind of exploitation, of producing surplus value to enrich their masters. Whatever Galtieri may say, Argentina is owned by its ruling class and not by the ordinary people who do all the work and some of whom have been sent to fight for the Falklands. However emotional Thatcher may wax, the fact is that Great Britain is owned by its capitalist class and not by the workers who, just as they run British capitalism, have manned the Task Force sent to recapture the Falklands.

All over the world, in every capitalist state, there are masses of people who depend for their living on the sale of their labour power. Internationally, these people have a common interest which is opposed to that of their ruling classes. The workers of Argentina have interests opposed to those of the class represented by Galtieri and the same goes in the case of the workers in Britain and the class represented by Thatcher and Foot.

This has been true for as long as there has been a society of two classes—for as long as capitalism has existed. In both world wars, for example, the workers who were fighting and killing each other were doing so in ignorance of their international common interests. Instead of firing at each other, they should have been extending the hand of fraternal greeting and unity.

For this to happen, it will first be necessary for the working class to come to an understanding of their social position under capitalism. They will need to understand that the roots of capitalism's problems lie in the nature of that society and that those problems can be ended only by the abolition of capitalism. That understanding will arm workers throughout the world with the consciousness to move society, through democratic political revolution, into a fundamentally different phase.

This phase is called socialism. The end of capitalism must lead to its replacement by a social system based on the communal ownership of the means of wealth production and distribution. This society will be without classes and therefore will have a unity of human interests. People everywhere will co-operate in the production of goods and services and everyone will have free access to that wealth.

The unity of socialism will unleash, for the first time in history, the full powers of the human race. In one way or another, private property society has been a brake on these powers and at no time has this been more apparent than under capitalism, which has dramatically developed productive powers and then either held back or tragically misused them. One ready example of this misuse has been the fiendishly clever weaponry in use in the South Atlantic.

Socialism will be established by an international people who have seen through the divisive cynicism of patriotism. They will opt for common ownership and free access because they will be conscious that private property society produced poverty, war, famine, disease and a host of other equally desperate social ills. They will want to free human resources and abilities to produce the abundance of wealth of which we are capable. Socialism will achieve all of this; in stark contrast to patriotism, it will be the highest stage of human social organisation.