The following piece, written by the late Pieter Lawrence, is the tenth chapter of his 2006 work, 'Practical Socialism - Its Principles and Methods'.
Chapter 10
Advantages of Production Solely For Use
Change in the Social Form of Labour
It is important to refer to production in socialism as being “solely” for use. This is for the obvious reason that in all societies, be they bread, bricks or bombs, things are produced for a use of one kind or another. But in the market system, commodities are also produced for sale. Goods for sale have a twin identity in that they exist in both an economic and useful form. The same is true of the labour that produces them. In employment, the wide range of different skills have one thing in common, they have economic value. Labour as a commodity is bought and sold on the labour markets. In the production, distribution and consumption of commodities the ability of consumers to use goods depends upon their ability to first pay for them. This is because the primary motive of capitalist production is profit and the accumulation of capital. In socialism this profit motive would not exist with the result that goods would be produced “solely for use.”
Capitalist production begins with investment of capital in labour, factories, plant, machinery and materials: goods are then worked up and sold on to the place of final assembly. Of all the values involved in commodity production the value of labour has the unique ability to create values over and above its own value. This is the source of surplus value from which profit is derived and which is realised through sales. The realisation of surplus value through sales allows for capital to be accumulated. This accumulation of capital is then available for re-circulation after further investment in production. As a consequence the use of labour remains locked into a circular economic system.
In a socialist society the present two fold character of labour, that is, its combined useful and economic form will be dissolved. In capitalism, labour, in its economic form is activated by a prospect of sales/profits: in a socialist system, only labour in its useful form would be activated solely by needs. This requires that the present economic relationship of capital and wage labour be replaced by a direct relationship of cooperation between the producers themselves.
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Communities in socialism, having democratically decided their needs both in terms of quantity and quality, within the limits of practicality, would be free organise production in line with their decisions. Labour will find its freedom outside the present enclosed, circular system of exchange. All the advantages of production solely for use will flow from this liberation of labour. In Socialism, resources of labour and materials will at last be freely applied in whatever ways the community may decide.
Greater Use of Production Methods
In any society there are absolute limits to production. However, the limitations on production in a capitalist system are not generally caused by lack of labour or material resources, nor by any practical problems of production. Limitations on production are mainly due to economic not practical causes. The use of labour is a means to an economic end and is not therefore simply a source of wealth production. Capitalism is not a rational system for the production, distribution and use of goods, it is primarily a system for making profit and accumulating capital and both these depend ultimately on market capacity for sales. It is market capacity that determines the distribution of goods and this determines the structure of production. It also places economic limits on the selection and use of production methods. Without these crippling constraints communities in socialism would be free to make much greater use of production methods.
We have already established that with the redundancy of useless occupations, the availability of the once unemployed, the social inclusion of the culturally deprived and the bringing to well-being of millions of undernourished and demoralised people, Socialism would be able to at least double the numbers of people available for the production of useful wealth. As well as this, what are the prospects for increasing the productivity of labour and making greater use of production methods.
The rate of productivity is easily exaggerated. For example, a company may invest in technology which displaces some of its workers. If this results in half the number of workers in that work place it might be assumed that productivity has been increased by 100%. In fact, the capital values of the new technology represent the labour of workers in other sectors of industry and in allowing for this the figure of 100% has to be reduced.
For example, there are far fewer workers employed in British agriculture today compared with 100 years ago but outputs have increased. But increases in the productivity of agricultural labour cannot be calculated from a simple comparison between the numbers of workers employed on farms and output. Agriculture has become capital intensive and as well as machinery, inputs such as fertilizers, pesticides, etc., have increased. This has resulted in changes in the structure of the work force whereby labour in the manufacturing and chemical sectors has been brought into agriculture. When these factors are taken into account, the real gains in productivity are far lower than is apparent. What we can say is that there are some factors which limit productivity in Capitalism which would not be present in a socialist system.
In capitalism, the work place, especially in industry and manufacture, is a scene of rival interests which may be sometimes quiescent but is often a battle ground. As part of the wage labour/capital relationship working people are not in direct cooperation with each other, they work within a relationship of economic exchange of wages for labour time. Inherent in this exchange is the determination of employers to extract as much output from workers as possible. On the other side of the division working people strive to gain as much payment whilst limiting output. This often breaks out into open industrial strife with, over time, countless millions of work days lost through strike action. This is a further feature of waste that subtracts from the overall productivity of labour.
Conflicting interests can also result in a range of subtly organised restrictive practices with workers limiting their output to implicitly agreed productive norms. This can sometimes involve a subterfuge of wasted time. A worker new to an established work situation learns from the existing practice what the appropriate intensity of labour should be and is soon able to conform. So, from the workers there is a tendency to reduce work effort whilst from the employers side there is a constant pressure to increase it. Automated machinery may be designed to prevent workers deciding their pace of work. The relative strengths of each side may be altered by movements in the trade cycle. In times of high unemployment the position of workers is weakened.
From time to time companies are compelled to set up new production methods or introduce labour saving machinery. This causes some workers to lose their jobs. Having invested in a production process a company would prefer things to stay as they are at least until they have used up their costs of machinery, plant etc., in the production of new values which have been realised through sales as profits. If, in the inter-play of competition, a similar company producing for a similar market sets up a more efficient process whereby they can be cheaper but just as profitable the first enterprise is faced with the choice of either reducing their prices in line and making less profit, or writing off their existing investments and investing in a different process.
A new process might involve a higher initial investment in new machinery, and whilst there may be gains in terms of a reduced work force, the ¬workers may not be willing to go; this raises the prospect of dislocation through more industrial strife. In the long run there may be little that workers can do to keep their jobs, nevertheless, these conflicts intensify the atmosphere of worker disaffection and cynicism which pervades the work process. This practice of wage labour is in sharp contrast to the spirit in which people could cooperate with each other in a work place where the work is in their direct interests, is under their control and unrelated to any economic time factor.
Company decisions on investment programmes are made against projections of market sales which are inherently unpredictable. Inevitably, market capacity fluctuates with the trade cycle. In times of deep recession, not just labour but transport, plant and machinery fall idle in every sector of production. In many cases the capital values of machinery are written off through bankruptcy. Idle or written off machinery represents labour congealed in useful capacity that has not been used. These are further examples of waste which subtract from the overall productiveness of labour in a market system.
Whatever figure is given for increased productivity of labour it is one that is reduced by economic limitations on the community’s powers of production. These are mainly the inability of the capitalist system to freely adapt and apply productive technique, the limits of market capacity and the limits of capital investment. Other dislocating effects may be strike action or other forms of worker resistance to any re-organisation of production and the adoption of new methods.
Productive Technique
For most of history working methods have depended on the use of hand tools. The industrial revolution introduced machinery and new means of energy. In the late nineteenth century this led to conveyor belt systems and eventually to automation and robots. Machinery works up the component parts of goods: conveyor belt systems provide for hand assembly as a repetitive process: automated systems can both work up component parts and assemble, but are dedicated to specialised operations: robot systems are a further development of automation. Standardised, electronically controlled robots can be adapted to a range of different automated processes.
There are generally three ways of increasing production: 1 - increas¬ing the intensity of production: 2 – increasing the time of output: 3 - reorganising the work process with labour saving methods. A socialist system would be free to set up manufacturing processes which could combine these ways of increasing production simultaneously.
With a community working in cooperation and with a direct relationship of work activity to needs, people in socialism could set up automated methods of manufacture that could produce goods whilst minimising labour. The use of programmable robots adapted to different operations means that these could also be produced in quantity. This suggests the technical possibility that automated systems of manufacture which would be flexible in use could themselves be produced where extra means of production are required. These automated systems, using programmable robots would provide for high volume, quality production, around the clock.
Thus, intensity of production plus optimum production times, adding up to high productivity would be realised through these methods. When these technical factors are taken together with the increased numbers of people who will become available for useful production, the range of skills included in these numbers; when it is considered that the setting up of these systems will be free from industrial strife and the constraints of capital investment; that their intensity and duration of use will be free from the limits of market capacities, and when it is further considered that such means of production could be set up in a most economical way and without duplication, it can be seen that a socialist system could combine enormously increased powers of production.
This is not to suggest that the aims of a socialist society would be concerned solely with the production of more and more consumer goods. On the contrary, we may anticipate that very different values will shape the quality of life in socialism. However, in its early days its great productive advantages would need to be applied to world problems. It is for this purpose that the liberation of labour resources would be important.
Wider Selection of Production Methods
Having emphasised that labour resources and productivity could be increased in socialism; it is also true that production methods would not necessarily depend on being the most labour efficient. Market pressure to minimise labour time in order to keep down costs and gain competitive edge could give way to other, more socially desirable reasons for deciding methods of production.
The concept of needs is not solely about material things. The quality of work itself is an important human need. Care of the environment and conservation are also important needs. After the exploitation of the earth by the ruthless economic forces of capitalism it is vital that we pay full attention to the care of our 'home in space'. Safety and animal welfare are also criteria which would influence the selection of production methods. All these criteria would be different in operation to the main reasons for selecting production methods in a capitalist system; these are methods which require least inputs of labour in relation to maximum outputs and cheapness.
At present, under the pressure of competition and exploit¬ation, manufacture is broken down into a few repetitive movements aimed at maximising output whilst regimenting the work force. Socialism would avoid this. The release of pollutants into the atmosphere may be part of the cheapest way of converting fossil fuels into electricity, but Socialism would not continue this. Socialism would not need to take the risks involved in the construction and use of fast breeder nuclear reactors. The cruelty of confining animals in the dark in cramped spaces may be part of the most 'efficient' method of converting cereal inputs into animal protein, but Socialism would not do it.
Communities in socialism would be free to select production methods that would be concerned with quality of life and would express values different to those which see consumption as life’s sole objective. It is true that socialist society will face a considerable task in raising the living standards of many people, but a sole emphasis on material 'abundance' can borrow too much from the values of ‘consumerism'. Socialism would need to exercise great care in the ways in which it could use its vastly increased powers of production.
Conservation Production
The change from capitalism to socialism will bring a change in productive relationships from wage working to cooperation. In turn this will bring a change in the relationship of society to nature. These go together. Capitalism is not sim¬ply based on the economic exploitation of labour; it exploits anything in nature it can get its hands on. This means that before society can control its impact on the natural world it must first have social control over its own actions. Before society can organise itself in harmony with natural systems, society must first be able to co-operate within itself.
As human beings we are, of course, a part of nature, but we tend also to view nature as something separate from ourselves in that it provides us with our means of life. We may see land, seas, forests, river valleys and deserts as beautiful, spectacular landscapes and we may also be aware that they contain useful resources such as coal, oil, natural gas, various metals such as iron ore, copper, tin and many other materials. In a capitalist system such natural wealth, like labour and useful goods, also exists in an economic form.
Land can be a useful resource for the produc¬tion of food but in the eyes of agribusiness, land is a capital asset to be used for profit. Timber, oil or mining companies do not view forests, oil reserves or iron ore deposits simply as useful features of the natural environment. Companies view them as things to be exploited for private money gain.
As capitalism has spread across the world to become the dominant world system, almost the entire planet has come to exist in an economic form in which labour works on natural resources for the profits of companies. We see this now in the growth of multi-national corporations. This exploitation of the natural world is driven by markets and the pursuit of profit in ways that cannot be democratically, or even rationally, controlled.
The consequences are well known but we seem powerless to stop them. Every year millions of tonnes of sulphur dioxide are released into the atmosphere; radioactivity is increased; land is saturated with industrial chemicals; forests are destroyed whilst deserts are created and seas are polluted. We live with a real danger that natural systems such as those of the biosphere are being damaged on a scale which threatens their self recovery. These are the vital systems on which human life depends.
Care of the environment is not primarily a technical problem. Our destructive use of the planet is caused by the motives, limitations and economic relationships of the capitalist system. By freeing labour from its economic exploitation by capital, socialism will also free the natural world from this same exploitation. With people cooperating to produce directly for needs a socialist system would be free to use methods which could ensure care of the environment. The fact that such methods might involve the use of more labour will not mat-ter. Socialism will have an abundance of labour and will not be constrained by the profit motive and competition to use the least amounts of labour in production. The aim would be to organise produc¬tion in ways which would minimise any negative affects on the environment.
Socialism would have no difficulty in adopting a practice which is impossible under capitalism. This would be the practice of "conservation production". In a socialist system we could protect the balance of natural systems and would also con¬serve natural materials. The profit motive involves a plundering of natural re¬sources against a background of market pressure to constantly renew capac¬ity for sales. Cheap, shoddy articles and "throw-away" goods involve a mas¬sive loss of materials. Design for "built in obsolescence" is deliberately aimed at a short time of use. The rotting hulks of million of cars and other consump¬tion goods are the ugly evidence of massive waste. No sane society would burn millions of tonnes of oil and coal in power stations without considering the alternative technology which already exists to produce electricity.
Socialism could avoid the loss and destruction of resources. Production facilities could be designed and produced in a way which would be conserve materials. Such design could aim at a minimum of wearing parts, which, with simple maintenance, could be easily replaced. The parts not subject to wear could be made from durable materials, and if for some reason equipment or goods became redundant, these would be available for other uses. The materials lost from wear¬ing parts would be a small fraction of the total materials in use. This practice of conservation production would mean that once materials became socially available after extraction and processing, they would be permanently avail¬able for use in one form or another. A useful analogy is with gold. A small amount may be lost through accident, but because it is a precious metal most of the gold that has ever been mined throughout history still exists. For this reason it is said that gold mined by the early Egyptians is still in use.
Conservation production would mean the bringing into use of means of pro¬duction of all kinds, permanent installation and structures, durable consumer goods, all designed and produced to last for a long time and, even when redundant, capable of being re-cycled for other uses. In this way, materials would be available as a lasting resource.
The World as One Productive Unit
Whilst we, as humanity, remain divided by rival capitalist states, it is be impossible to organise our use of the world in careful and sensitive ways that would be in the mutual interests of all people. Instead, we have economic exploitation, waste, war and destruction. Although we mostly think of the market system in terms of private corporations or state enterprises, it is also true that each nation is a “national business.” A national economy must do its budgeting and keep its accounts as an autonomous trading nation. Governments must maintain national security. This is the protection and enforcement of national interests both within the state and between states. Externally, national security involves diplomacy, negotiated agreements and the formation of alliances which in turn can be backed up by networks of spies and where necessary the threat or use of armed force. The strategic aim is the ability to trade at the best advantage.
As caretakers of national economic strategy, governments aim to promote national advantage whilst reducing vulnerability. For example, energy supply is of vital concern to all governments but the world distribution of energy sources, oil, gas, coal etc., is uneven between nations. One reason why the Middle East has been an ongoing theatre of war for many years is that it holds the world’s biggest reserves of oil. In the past, with the Suez Canal, it was also a vital trade route.
At the time of writing the war in Iraq is over its oil resources. In the past Britain was the strongest power involved in Middle East conflicts, a position now held by America with Britain a junior partner. During the build up to the invasion of Iraq, countries such as France and Germany opposed the actions of Britain and America but not for any moral reasons. The Governments of France and Germany foresaw a situation where America and to a lesser extent Britain, would enjoy the great advantage of control over the world’s second largest oil reserves.
The solution is to replace corporate or state ownership for money gain with common ownership by all people. Instead of nation states all people could be part of a world held in common. This would bring the great advantage of being able to organise the world as one productive unit. Being united around a common interest people in socialism could organise and develop their productive activity in relation to the natural advantages of the earth in whatever appropriate geographical location and with a use of production methods which safeguard the world environment.
Without national barriers it would be possible to use large scale production in appropriate areas to make available world stocks of materials for manufacture, basic foods such as cereals and world energy supply. From this basis of world production, smaller scale diversified production could be carried on throughout regional and local communities in line with local work preferences and local needs.
In these circumstances instead of rival nations fighting over oil reserves, as mentioned, the production of energy could be co-ordinated by a specialised world agency working as part of the United Nations Organisation. The long term objective could be to achieve sufficient world energy supplies from ecologically benign sources. The possibility of a world organised as one productive unit adds to the wide range of advantages that people in socialism would enjoy.
With the world shared between all people an early priority would be to remove the differences that at present exist throughout the various regions. In practical terms this would require a concentration of world activity in favour of those regions where poor facilities for local production, storage, transport, irrigation, energy supply, communications, buildings and services such as medical care, etc., would need to be improved. This would call upon the efforts of people in the more developed regions.
It might be asked, “Why should someone in a more developed community in Britain, America or France, work without money incentive, to provide equipment and machinery for people in less developed regions?” The candid answer is – self interest! This is not to deny the abundant evidence there is that we can gain satisfaction and pleasure from helping people in need but the added reason why we all have an interest in cooperating with others is that the benefits are mutual. Up to a point, the more people producing and the greater range of skills that are used, increases not only productivity of labour but also the range of products that can be produced. Stranded on a desert island, on our own, we would be reduced to surviving on the barest necessities. Since stone age times, our increased powers of production have depended on our diversity of skills.
In the wheat belt of South West Australia a farmer might be supplying cereals for distribution throughout the world. It is likely that the eventual consumers of this wheat will never know the identity of the person who helped produce it. This does not matter. The farmer would do his job in the knowledge that in distant locations others were working to supply not just the whole range of foods he enjoys but also the refrigerator, television, computer, hi fi system, etc., that make his life style possible. In socialism our participation in a world wide division of labour would involve us in much more than technical factors of production, it would include us in the work of a true world community.
Strategy for Development
For some years there has been growing concern over the impact of human activity on the world environment. This is felt in the scientific community where, for example, the evidence for global warming is gathering strength. Concern is also expressed by ecology groups and the parties that make up the green movement. There has been pressure to reduce carbon emissions but across the world, these pollutants have increased. The various international conferences at Rio, Kyoto and The Hague have failed to make progress and in some cases have broken down in acrimony and disagreement.
To repeat an important point, any idea that problems of pollution are technical problems is wrong. Although The Hague Conference of 2000 was attended by hundreds of technical experts, the main arguments about what can or cannot be done were about money and costs. The arguments were about the strategies of the participating states in defence of their economic interests. This was reported in The Economist (Nov 18 2000) “… the big oil producing countries are, in a flight of fancy, demanding compensation for the harm they will suffer from lost oil sales; they are trying to block the Kyoto process as a conspiracy to damage their economies.”
The Kyoto accord of 1997 was, on the face of it, an agreement amongst the developed nations to cut the release of greenhouse gases by 5% below 1990 levels by 2008/12. Since then most countries have increased their pollutants and in America these have soared. The parties to the Kyoto accord also, “… agreed that cutting emissions might be so expensive that the treaty should allow countries innovative, flexible approaches to reduce compliance costs.” It was language such as “innovative, flexible approaches,” that was described as evasive, and even a “con trick.” It was the difficulties arising from the economics of the problem that made the Kyoto, Rio and The Hague conferences incompetent to deal with it.
The Green Movement blames reckless governments and the rapaciousness of multi national corporations for world pollution. Whilst there is truth in what they say to concentrate on this argument is to evade the more basic cause. Built into the market system is an irresistible pressure to constantly renew its capacity for sales. Any significant increase in energy costs could risk disturbing the fragile balance of costs, sales, profits and employment. This could pitch an economy into recession with the further risk of deeper slump. For example, a similar conference on global pollution held in London in 1993 had broken down for exactly these reasons. Since the 1980’s the government in Britain had been under strong pressure from Scandinavian countries, which were afflicted by “acid rain”, to reduce carbon emissions from its power stations by 30%. One way to achieve this would have been to install flue gas desulphurisation equipment to coal burning power stations. The reduction of 30% sulphur emissions would have cost £1bn. In the 1980’s the British Government was struggling to get out of a deep recession in which there were at times over 4 million unemployed. It was not in a position to add £1bn to its energy costs. A “Green Government” would have faced the same difficulties. In refusing to sign up to the Kyoto Accord, President Bush said that his first priority was to “save American jobs.”
In demonising oil companies, other multinational corporations and reckless governments the Green movement appears not to appreciate the depth of the problem. This is also indicated by its insistence that market economies should level out into a “zero growth” mode. It is possible that zero growth may be a desirable aim but to suggest that it could be achieved by a market economy ignores its basic drive to constantly renew its market capacity for sales. However, a state of zero growth would be possible in a socialist society.
This is not to predict the future, nor to anticipate any policy decisions that would be made in socialism. The point is to simply set out what would be practical and possible, given all the advantages that a system of cooperation and production directly for needs would be able to work with. What we can envisage is a strategy of development aimed at zero growth that could be achieved in possibly three stages.
1 Emergency action to stop people dying of malnutrition and disease. This could be an initial period of growth beginning from a position of scarcity and focussed on food production, health services and relief of desperate conditions of poverty.
2 Having achieved this first objective, using the methods of conservation production, communities in socialism could create durable production facilities and public utilities that would be available for use for a long time. Even with the removal of waste and the adaptation of the sectors of industry and manufacture at present used for arms production it is likely that new means of production would have to be set up. Probably the biggest task would be to create the means of producing the materials for housing and the services and infrastructures to go with it. A further priority would be to increase agricultural machinery and all means of increasing food production. These projects would include agriculture, housing, a safe world energy system, and infrastructures such as irrigation schemes, sewage and drainage, clean water, roads, bridges, transport, com¬munications systems, leisure facilities, etc.
3 The achievement of stage 2 would call for a high peak of initial activity but when sufficient means of production, together with a safe world energy system and infrastructures are in place they would be available for use for a long time and would not need to be constantly produced. With maintenance, well built houses and such structures as bridges will last for hundreds of years. This means that after they have been brought into use total production could fall.
A state of zero growth would be a position where communities need only concern themselves with the day to day production of goods for consumption, particularly those such as food which have a limited shelf life. Also necessary would be the running of services and maintenance. In socialism the achievement of zero growth would mean stable levels of production for stable levels of consumption using production facilities which would be in use for long periods.
This outline of a possible way forward to a state of zero growth assumes that people would be content with a constant level of sufficient consumption; that production facilities would not be subject to constant innovation, and that population numbers would not go on increasing.
The projects necessary to get to a state of zero growth would call for both world cooperation and world organisation, particularly in the supply of information, planning and decision-mak-ing. It follows that when accomplished, not only would production levels fall but the need for information, planning and decision-making would also be reduced. This anticipates that centres of organisation at the world and regional levels, could give way to more locally organised production for the work of providing for daily needs, the running of services and maintenance.
What is possible here is a self-regulating society with work activity in balance with daily needs and in balance with the environment. What this could mean is that providing for the necessities of daily life would be more under local con¬trol involving less allocations of social labour. This could create vigorous communities with wide scope for individual development and diversity of expression.
Past discussions about the methods of production that Socialism would use have centred on simple and somewhat unrealistic preferences for either high technology or hand craft methods. In fact, a socialist system could combine a diversity of methods. Where necessary and appropriate, high technology methods involving labour diffused throughout world production could be combined with more simple local production. This could include the use of local hand craft methods for making clothes, furniture and the supply of local food for local consumption where this might be a chosen life style
Would a sensible society, conscious of its need to limit productive activity and keep it in balance with care of the environment, really want to continually develop new production facilities? How much of the innovation that goes on represents real gain, and how much of it is part of changes in fashion to do with consumerist values and attempts by corporations and their advertisers to increase sales? We can surely assume that people in socialism would not go on and on with the increased production of goods and services for the sake of it. This would be a self-imposed treadmill. Would a socialist system really want to follow the example of capitalism where life’s objectives are focussed on the acquisition and consumption of material things? It will of course be important that needs are satisfied but the concept of needs will no longer be based on the idea that increased happiness comes with increased consumption and possessions. Such an illusion, expressing the consumerist values of a market system could give way to a responsible, self determined appraisal of needs which would reflect the enjoyment of more meaningful community relationships.
Pieter Lawrence
Link to Chapter 11.
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