Letter: Big money (1976)

Letter to the Editors from the July 1976 issue of the Socialist Standard

Big money

Further to my letter about top brass salaries and the labour theory of value, here is a news item from the Daily Mail 3.3.76. Sir Richard Dobson’s salary from British Leyland is £22,500 per annum or £450 per week and he got an £80,000 golden handshake when he left British American Tobacco. The Prime Minister defended Sir Richard’s appointment, arguing that “a rather wise, elder statesman” was needed.

What wealth does their costly labour-power produce? Supply and demand is a lame excuse as there are dozens of understudies who can do their “jobs”.

In fact they are absentee directors as well and assistants don’t produce a pea but get good pay. Well, how are these huge “wages” fixed according to the socially-necessary-labour theory embodied in a managing director as with a dustman? plus a few cigars at £80,000 for recreation?

Look at the pages of closely printed money — capital going into billions — in the Financial Times, chasing investment, creating nothing, getting a fat living out of dishing out other people’s surplus-value cash. It’s incredible!

Harold Shaw

Gloucester

Reply:

We think you are confusing two issues. First, as we said in our reply (April SS), some capitalists have nominal occupations, most commonly as “directors”, for tax purposes. An example in The Sun, 26th April, is of Peter Parker, proud to be a “socialist” and a capitalist. The Sun states that he has “a Rolls- Royce, splendid homes, no end of directorships, and an income around £55,000.” Enormous incomes mentioned elsewhere in the April SS represented shareholdings — not wages.

On the other hand members of the working class are employed as executives. The production of surplus-value is easiest explained first in terms of those actually engaged in production, but it must be understood as a social process. Capitalism is a complex system which needs banking, salesmen, advertising and management etc. It is the working class as a whole which runs this system. Socialist society will not require people to occupy prestige and leadership positions, but these jobs are necessary to capitalism.

We think you should raise your sights beyond the fact that some workers receive amounts much in excess of the wages earned by the majority. Our opposition is to the capitalist system itself.

Editors.