Monday, August 15, 2016

Profit before need—again (1992)

Editorial from the January 1992 issue of the Socialist Standard

Half of bedsit tenants live in unhealthy, unsafe homes, according to a report from the Audit Commission last September. At least 300,000 people in England are homeless, most in squalid bed-and-breakfast accommodation, but thousands live rough in such places as Cardboard City under Waterloo Bridge in London. Nearly 2.9 million homes are in poor condition, according to the last major survey in 1986. including 900,000 statutorily unfit. 460,000 lacking one or more amenities, and 2.4 million in poor repair.

Clearly, for millions of people their basic need for decent housing is not being met. There is an urgent need for existing houses to be improved and for new homes to be built. So why isn't this done? Why are the housing needs of so many neglected in this way?

One possible explanation would be that there is a shortage of skilled building workers to carry out the repairs and build the new houses. That this is not the explanation can be seen from the announcement last August by the Building Employers Federation that 150,000 building workers had lost their jobs since the middle of 1990 and that a further 100,000 would by the middle of 1992. So we are talking of there soon being a quarter-of-a-million unemployed building workers, not counting those who were already without work in 1990.

Perhaps there is a shortage of building materials? But this can't be the explanation either since "producers currently have almost 1.4 billion bricks stacked up in their warehouses—higher than in 1982, the nadir of the last recession, or in the mid-1970s, when the property market collapsed. That is enough to build 170,000 more houses" (Independent, 25 November 1991).

So what is the explanation? Simply that those who suffer from bad housing and those who have no home can't afford to pay for decent accommodation. A report in 1990 from the Audit Office on the homeless was quite explicit on this: “The link with poverty is underlined. The report says the average net income of homeless households in 1988 was under £100 a week, compared with an average income for all households in 1986 of £192 a week" (Daily Telegraph, 22 August 1990). The 1986 survey of housing conditions was equally clear: “78 per cent of homes lacking basic amenities had annual incomes of less than £6000 a year. The same was true for 69 per cent of households in unfit housing and 55 per cent of those in houses in poor repair" (Daily Telegraph, 12 September 1991).

What this means is clear. The resources—the materials and the skilled workers—to solve the problem exist but, under the profit-driven market economy, the incentive to do this is lacking. The capitalist economy only responds to paying demand, not real demand. Some group, such as the badly housed and the homeless, may have a need for something, even something as basic as decent housing, but unless they can afford to pay for this it will be neglected. The profit system only allows production to take place where there is a prospect of a profit being made. If this prospect is absent, then production will not take place. People's needs will go unmet.

This is why we have the obscene situation of hundreds of thousands of unemployed building workers and huge stockpiles of building materials along side millions of people living in bad housing conditions. It is further proof, not that any is really needed, that the profit system does not serve human needs.

The profit-driven market economy is not the end of history and pinnacle of civilization towards which humanity has been travelling since we came down from the trees, as some of its more lyrical defenders used to claim in the 1980s. It is a squalid system that is incapable of meeting even people’s basic needs in an adequate way. That is why it must go, and be replaced by a system of common ownership and democratic control of productive resources. This is the only social arrangement that will allow productive resources to be used for their proper purpose: to satisfy the needs of the members of society.

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