Editorial: Socialism no accident (1982)

Editorial from the August 1982 issue of the Socialist Standard

The readers of the Sun may not have been aware of it, but when their man in the Falklands sent in his reports, couched as they were in glorious yobspeak (“Up Yours, Galtieri”), he was making his small contribution to bolstering a seriously misguided concept of history.

It is an established, popular notion that wars spring from the personal idiosyncrasies and failings of political leaders. In some cases, those leaders are supposed to be insatiably belligerent — like Galtieri. In other cases, they are described as bloodthirsty and genocidal — like Hitler or Menachem Begin. According to this theory, if there had been no Galtieri and no junta, there would have been no war over the Falklands. More peaceable leaders would never have tried to take by force that which was not theirs by “right”. On this theory, the Falklands war was something of an historical accident.

At home, we have seen this notion at work also in the case of the rail strikes by ASLEF and the NUR. These strikes, we were told, were the work of a minority of unreasonable, restless militants. Without them, the railways would operate smoothly, as workers and management co-operated to the benefit of everyone. By these standards, the rail strikes were also accidental.

Then there is the example of Margaret Thatcher, who is the butt of much anger as a stubborn, prejudiced and callous adherent to policies which. she insists, will be good for us even if they kill us in the process. Three million unemployed, and the intensifying pressure on workers’ living standards, are attributed to the historical misfortunes of Thatcher’s obduracy. Without her, we hear, there would be less unemployment — or even none at all — and easier, fuller lives for everyone.

But while it is true that people have a crucial influence on the course of history, and while there are important historical factors which might loosely be described as “accidents”, the fact is that history is basically not to be understood in such terms. The process of social development from the most primitive of societies to the present day has only one valid interpretation and that is as a continuous, predictable, evolution along a discernible course. On that concept, we not only understand what has happened in the past; we can foresee with some confidence what is likely to happen in the future.

The Falklands crisis did not spring solely from the determined belligerence of a handful of South American militarists. Latterly the Islands have assumed an increasing importance in the overall strategy of Argentinian capitalism, complicated by the possible presence of rich oil fields and the fact that historically the Falklands issue has been cynically used to stifle the realities of wage slavery in Argentina under a blanket of patriotism. The British ruling class, far from losing sleep over the “paramount” wishes of the Falklanders, have for decades been negotiating to pass the Islands over to Argentinian rule. This policy was no accident; it fitted in with the reality of Britain’s place in the conflicts of world capitalism.

The rail strikes cannot be explained in romantic terms, of militants against the true interests of the railwaymen. Workers on the railways, like those in other industries, were resisting a downward pressure on their wages and working conditions. Perhaps their effort was badly timed; when there is high unemployment strikes can have little muscle behind them. Perhaps the abrupt climb-down by the NUR was their acknowledgement that the time was not propitious. But in historical terms it was another incident in the continuing class struggle of capitalism and it will not be the last of its kind, as one side or the other takes advantage of the current conditions of the labour market.

The policies of the Thatcher government are not basically different from those of Callaghan, Wilson, Heath, Macmillan . . . Every government has to contest with the working class; that is part of their function as the administrative arm of the capitalist class. In most cases, governments in post-war Britain have been weakened in their efforts by the strength the workers have drawn from relatively high employment and demand for labour power. This meant that attempts to keep wages in check — pay pauses, wage freezes, social contracts, whatever name they went under — were easily undermined and, sooner or later, modified or abandoned. As Thatcher came to power, the slump in world capitalism had reached such depths as to enable a government to impose policies which until then had had scant chance of success. Thatcher, then, is no accident; she personifies an especially repressive, exploitative phase in capitalist history.

The importance of understanding that capitalism does not progress through a series of accidents is in the fact that the next stage in human history — socialist society — will evolve from the contradictions of the present and will not therefore be accidental. Indeed, the very conditions for that change have been, and are being, historically laid down.

Capitalism has provided the human race with the possibility of producing an abundance of wealth. It has developed the means of production, distribution and communication to the point at which a society in which the human race can live in material security is immediately available to them.

Capitalism has refined the class structure so that there are now only two classes in society. It follows from this that the revolution to bring about the next stage in social evolution must be the work of one of those classes, with the object of emancipating that class.

It is the working class who historically fit that bill; they are the revolutionary class under capitalism. They are the class who are to be emancipated, the class who produce the wealth of capitalism but have no effective ownership. To fulfil their historical, revolutionary role the working class must understand capitalism, and the need to abolish it. They must also be aware of the effectiveness of replacing capitalism with a society of common ownership and free access. Capitalism itself, in the everyday experience of its inability to meet the needs of its people — its wars, famine, repression, disease — provides the motivation towards such an understanding. Historically, capitalism works towards its own demise.

History can be left to condition itself; the work of human beings is to make their history, albeit with many “accidents . . . surprises . . . mistakes. . . ." On those terms, the human race is moving to the historical step of establishing the first social order based on the interests of the majority.

Unemployment in the 30s and the 80s (1982)

From the August 1982 issue of the Socialist Standard

Every one of the political parties in this country (except the SPGB) claims that it has a policy which, if the government applied it. would reduce capitalism's unemployment to a very low level and keep it there. It was the late Hugh Gaitskell, leader of the Labour Party, who wrote in 1959:

The great ideal of jobs for all first became a peacetime reality under the 1945 Labour government . . . The first objective of the Labour Government will be to restore full employment and preserve full employment. 

They had to wait five years, until October 1964, to see a Labour government in office again. At first it had some luck, in a small decline of unemployment in 1965. Emboldened by this. John (now Lord) Diamond, who was Chief Secretary to the Treasury, explained to the House of Commons on 1 March 1966 how this fall had been the result of government policy, and “that is how we propose to continue doing it". Then the government's luck ran out. Instead of unemployment remaining at 371,000, as instructed by Diamond, it jumped in 12 months to 631,000. and when the Labour government left office in June 1970 the Tories were able to show that unemployment was 200,000 higher when it took office.

But the Heath government which followed was equally unlucky. They, too, were pledged to “full employment" but saw the total rise from 582,000 in June 1970 to nearly a million in 1971 and 1972. Then came the Labour government of 1974-79, during which unemployment more than doubled, followed by the Thatcher government under which it has more than doubled again. All four governments from 1964 to the present time have been sailing on a rising tide of unemployment and there was nothing any of them could do about it except wait for it to subside in capitalism's own time.

However, though the governments cannot do anything about the amount of unemployment, the party politicians can indulge in an old game of challenging the official figures. This needs two teams, the opposition and the government, though anyone can join in. An accepted rule of the game is that the opposition, whether Tory or Labour, is on the attack, and the government, whether Tory or Labour, is on the defensive. Points are scored by the opposition when it can plausibly argue that the real number of unemployed is higher than the official figures; and by the government when it can counter the charge or claim that unemployment is really a blessing in disguise.

There was a splendid match in the winter of 1971. It was then that the official figure nearly reached a million and the Heath government had to meet the charge that the proper figure was higher. But how much higher? The Financial Times (11 December 1971) suggested that it was perhaps 1,250,000! The Observer (23 January 1972) quoted an estimate of 1,500,000. but in a later issue (23 February 1972) thought it might be 2,000,000. Not to be outdone Harold Wilson (Financial Times, 8 April 1972) put it at "nearly 3.000,000", and Peter Jay (The Times. 9 March) reckoned that it was "over 3 million”. An official estimate was that there might perhaps be 400,000 out of work who were not on the register, which would have given a total of 1,367,000.

Basically the official figures of unemployed on the register were, and are, disputed on the ground that a lot of unemployed workers do not trouble to register — including, in recent years, some redundant workers who do not seek work while they are spending their redundancy pay. The official figures are arrived at in the monthly count of the number of people available for, and genuinely seeking, work. The more extravagant estimates of a higher figure include guesses at the number of people, particularly married women, who are not seeking work but might perhaps do so if they could see that vacant jobs were available at sufficiently attractive rates of pay.

Faced with these embarrassing estimates of much higher unemployment the government at the time thought up some counter arguments to show that real unemployment was actually less that the official figures. They said that the large number of people they described as "unemployable” ought to be taken out, as should those registered unemployed who were only in the process of changing jobs, with a gap of a few weeks in between. And what about the people improperly included in the register who were secretly doing jobs on the side?

The most ingenious government defence came from John Eden, Minister for Industry, who said that the large number of unemployed on the register "reflect in part the redeployment that is under way"; meaning that it arose out of the government's policy of moving workers from contracting industries into expanding ones. "We can now look forward to what could be our greatest period of sustained growth in decades" (Financial Times 11 December 1971). The Thatcher government has had to fall back on the argument that the unemployed largely owe their condition to having pressed for too-high wages, and that it will take a long time for Tory policy to get things right.

In the politician's game about the unemployment figures points are scored by the opposition if they can claim that unemployment has reached a record level. For months on end. during the Labour government of 1974-79. the Tory opposition was able to do this, as unemployment climbed by over a million, from 629,000 to 1,636,000 in 1977. The form of the attack was that the figures were “a post-war record". Latterly, Labour Party politicians have been saying that the present figure of 3 million is “the highest ever recorded". The intention is to convey that unemployment now is greater than it was in the 1930s which it certainly is not.

The point is that the severity of unemployment has to take into account not only the number of unemployed but also the total number of workers to which it is related. For example, 2 million unemployed out of 10 million workers would be twice as severe as 2 million unemployed out of 20 million workers. Firstly, in 1932, the total number of wage and salary earners was perhaps about 19 million compared with the present 24 million. Secondly, fewer than 13 million of the 19 million were covered by the Unemployment Insurance Scheme and the official figure of unemployment in 1932 (over 2,900,000) took into account only those of the unemployed who were insured. If unemployment was as severe among the other 6 million workers as among the 13 million who were insured, the number of unemployed would have been shown as well over 4 million. Among the workers who were not insured were agricultural workers and non-manual workers generally.

Writing about unemployment in 1936, when it had fallen far below its peak of 1931-2, G.D.H.Cole dealt with the point:

There are, as we write, roughly 1.600.000 of them in Great Britain in the insured trades alone, there are really a good many more altogether; for there are also 110,000 uninsured workers on the register of the Employment Exchanges and an unknown number more who are neither insured nor registered. (The Condition of Britain, p. 219.)

Cole mentioned that at that time there were nearly 250,000 unemployed coal miners.

In 1932, when there were over 2.900,000 unemployed insured workers, on the register, it is the fact that 23 percent of the insured workers were out of work which gives a more accurate picture of the severity of unemployment generally, among both insured and uninsured workers. Unemployment was therefore very more severe in 1931-32 than it is in 1982. when it is 12.8 percent. The same is true of the United States where unemployment in 1933 was over 25 percent, compared with about 10 percent at present. Needless to say the “numbers” game was in full swing in the 1930s and with even more scope for guessing, since nobody knew how many of the millions of uninsured workers were out of a job.

As unemployment under the Labour government had risen from 1,164,000 (9.6 per cent) in June 1929 to 2.813.000 (21.9 percent) in August 1931 when they went out of office, they got a little satisfaction from seeing it go on rising under the National government which followed. Among the points made in the Labour Year Book 1932 was that a seeming 60,000 drop of unemployed among women late in 1931 was due to “changes in the conditions for the receipt of unemployment benefit, by which the claims of a large number of married women were disallowed”.

Of course the Thatcher government’s much-heralded recovery has not yet produced results, and unemployment might yet rise to the levels of the 1930s.

Edgar Hardcastle

Political Notes: Social Democrats so what (1982)

The Political Notes Column from the August 1982 issue of the Socialist Standard

Social Democrats so what

Who cares about the leadership of the Social Democrats?

Well Roy Jenkins cares. No banqueting table ever received so delighted a slaver from him as when, declared the winner of the leadership contest, he contemplated the new brilliance of his once-glimmering hopes of becoming Prime Minister. “Our aim is to . . . make a major breakthrough to government". he asserted. David Owen cares. Second in the two-man race, he did not actually say "I want an important job in any future SDP government". What he did gulp out of his chagrin was: "Roy Jenkins is a friend of mine and we will work very much together". The SDP membership cares. Nearly 76 per cent of them cast their votes in the election for the man who, they hope, will head the next government over British capitalism.

But should anyone care about the outcome of this supreme non-event? A little more than 47,000 members of the SDP expressed a preference for one or other of two politicians who are inseparably associated with one of the most dismal failures in recent history. Jenkins’ time as Chancellor of the Exchequer was marked by a savage assault on working class living standards and by a succession of economic crises, all of which were clearly beyond his control. Owen was Foreign Secretary through an average period of international tension and conflict (including early rumblings of the Falklands war). If he had any ability or knowledge of how to eliminate these problems, he successfully concealed it.

Politicians have to base their appeal on a veiled assurance that there is some sort of magic trick of competence, learning or skill which can be applied to make capitalism run in the interests of its peoples. So far, even the slickest of them have not been able to perform the promised miracle. It is depressing, if unsurprising, that there are 65,000 workers in the SDP who are naive enough to believe that a tedious rehash of the discredited tricks of the other parties of capitalism can have any effect on the system's ailments.

An authentic desire to break the political mould would lead to the discarding of all the parties who stand for capitalism. To the detriment of the human race, few workers care about that at present.

Polish capitalism

For several months now, Poland has been under martial law, and very little information has been forthcoming about developments there. But there are still thousands of trade unionists imprisoned for their activities. Solidarity is still operating underground. There have been several demonstrations against the regime which the armed thugs of the state have brutally put down with water-cannon and truncheons.

But why is independent trade-union activity and the wage rises it might gain such a horrible threat in the eyes of Jaruzelski and the other representatives of capital and profit in Poland? On July 7, Polish leaders met their Western bank creditors in Vienna to negotiate the further rescheduling of debts. The Polish rulers are still over 27 billion dollars in debt, having borrowed large amounts to finance the boom of the 'seventies.

With the onset of world recession in the 'eighties, they are finding it impossible to repay these debts, both because of the lack of resources internally and the decreased purchases in the West of Polish exports — the preferred method of repayment.

As the Financial Times put it: “Even if Polish productivity accelerated sharply, the world recession would prevent the West from buying as much as the generals in Warsaw would like” (26 January 1982). Previous rescheduling has meant that two billion dollars of capital, plus interest, are due to be repaid this year.

The Polish rulers say they can do neither, and although some of the Western governments have made hypocritically pious noises about the martial law regime, the bankers themselves are generally anxious to see their Polish counterparts do anything they can to screw more wealth out of the Polish workers, for the repayment at least of the interest. They complain that their capital has been invested without purpose since they have not seen a profit.

All of these developments prove beyond the slightest doubt that state-capitalist countries like Poland and Russia are giant corporations, which fit quite consistently into the overall framework of world capitalism, with its exploitation of wage labour by capital to accumulate profit.

Anyone for democracy?

Even for the House of Commons — where they are not unwaveringly in touch with reality — it was a remarkable day when David Owen got up to voice his concern for the welfare of the trade unions. Was this the man who was Foreign Secretary in the government which ruled during the infamous winter of discontent?

Worse was to come. Owen’s unoriginal opinion that the collapse of the NUR strike proved the need for an extension of democratic procedures in the unions was applauded by Margaret Thatcher. Was this the Prime Minister presiding over the present ruthless assault on the unions?

Thatcher foresaw the introduction of new laws to force the unions to hold secret ballots before calling a strike. It is popularly viewed that such laws would drastically reduce the number and incidence of strikes. The theory is that stolid, responsible trade unionists who want only to be left in peace to surrender up the maximum of surplus value to their employers are being harassed and misled into strikes they oppose by militant trade union leaders. Just let the silent majority have its voice, runs the theory, and there will be very, very few strikes.

It is not so long ago that the opposite theory was popular with the likes of Owen and Thatcher. In those days the union leadership (men like Arthur Deakin and Tom Williamson) were respected as bulwarks resisting the pressure for strikes from the union membership. The result was often that the pressure boiled over into "unofficial” strikes — which meant that the members were in favour of them but the leadership would not organise them. The House of Commons then did not hear calls from vain politicians for the majority of trade unionists to have its way. Instead, it heard thanks and praise for the undemocratic, resisting leaders.

In any case, Thatcher and Owen got it wrong. There is no evidence that ballots would reduce strikes; it is very possible that a strike called after a ballot would be that much stronger and determined and therefore difficult for the employers to break. Above it all is the fact that industrial disputes arise directly, unavoidably, from the class struggle. There is no doubt which side Owen and Thatcher are on. A more democratic, more powerful trade union movement will be built in spite of their opposition.

Letter From Europe: Mitterrand clamps down (1982)

The Letter From Europe Column from the August 1982 issue of the Socialist Standard

It had to happen sooner or later. The attempt by Mitterrand's PS/PC government to revive the economy and reduce unemployment in France by giving people more money to spend—increasing “popular consumption" as it was called—just couldn't last. Since capitalism is a system which cannot be controlled or manipulated by governments and since most of the money to finance the social reforms in question came straight off the printing press, what happened was inevitable: the general price level in France rose, and at a rate faster than in other countries, leading to a fall-off in exports and a record balance of payments deficit which in turn made a devaluation of the franc inevitable. The effect on employment, on the other hand, was minimal: sales of consumer goods picked up for a while but the number of unemployed continued to grow, by nearly 16 per cent since Mitterrand came to power, passing the 2 million mark in October.

Exactly a year ago the Socialist Standard, analysing the economic policy of the then brand new PS/PC government, wrote:

It will fail completely and within a year or so they will be faced with growing working class discontent over persisting unemployment and rising prices which they will not be able to satisfy, since the continuing crisis will force them to recognise that under capitalism priority must be given to profits and profit-making rather than to social reforms and popular consumption. The crunch will then come and they will be forced, like all governments of capitalism sooner or later, to take openly anti-working class measures. 

As a matter of fact the crunch has come sooner rather than later, less than a year after the PS/PC government took office at the end of June 1981. On 12 June this year the French franc was devalued within the European Monetary System, for the second time in less than 9 months in fact, since Mitterrand had already been forced to devalue last October too. The October devaluation had been accompanied by rather timid price controls and mere appeals for some wage moderation. This time it was different. The government has adopted the following measures:

• a legally-imposed wage freeze lasting till the end of October, the only exception being the rise in the minimum wage due on 1 July; a legally-imposed price freeze also until the end of October but with some important exceptions such as oil, gas, electricity and imported goods;
• an increase in contributions to the health service accompanied by a cut in some benefits;
• a similar operation of increased contributions for less benefits regarding the unemployment insurance scheme.

The Minister of Finance, Jacques Delors, has already announced that austerity will not finish at the end of October but will continue. in the form of a restrictive “incomes policy", at least until the end of 1983; in other words, for at least 18 months in all.

Delors has also made no attempt to disguise the fact that the living standards of workers will have fallen by the end of October. He has publicly admitted that, while wages will be completely frozen, prices will rise by at least 2.8 per cent during this period. This will happen not only because prices are much harder to control than wages, but also because a number of exceptions to the so-called "prices freeze” are being allowed, particularly oil products (petrol, heating oil. paraffin) and imported goods. Since one effect of the devaluation will precisely be to increase the prices of imported goods, it is evident how large a loophole this latter will be.

So the government has now done a complete U-turn. The aim is now not to increase popular consumption but to reduce it! The Prime Minister, Pierre Mauroy, had already forewarned, even before the devaluation. that wages were soon going to come under direct attack from the government when he told a PS meeting on 21 May: 

Excessive nominal increases in incomes and wages maintain inflation and deprive our economy of the means to create jobs. The government has decided to act and we will shortly have occasion to talk about this again (Republicain Lorrain, 22 May).

It is clear from this that the government accepts the old. mistaken theory that it is wage increases that cause inflation. In fact, wages only increase in a period of inflation because inflation—an overissue of an inconvertible currency—inevitably leads to a rise in the general price level; wages, the price of labour power, merely rise in line with all other prices. Wage and salary earners are the victims not the cause of inflation.

The government's hope is that its austerity package will bring price rises—currently running at an annual rate of 14 per cent— down to an average of 10 per cent over the 12 months of 1982. This means of course that for the remaining months of the year the rate will have to fall well below 10 per cent. But unless they limit the amount of inconvertible paper money in circulation to what the level of economic activity requires—and there is no evidence whatsoever that this is their intention—then the pressure for prices to go on rising will continue.

If the currency is being overissued, then freezing wages and prices can’t stop prices rising. Certainly this can work for a limited period, just as a dam can stop a river flowing . . . for a limited period. Thus it is possible that the government could achieve a short term success but in the long run they will fail. Eventually, and sooner rather than later, the dam will burst and prices—including wages—will resume their upward trend. Delors is in fact very worried about what is going to happen after the legal wage and price freeze is over and this is why he is hoping to persuade the unions to moderate their wage demands over a longer period.

The union leaders, or some of them, may be prepared to go along with this. French union leaders are also politically involved and may well be prepared to betray their members’ interests to help a government they support just as British union leaders have done when Labour has been in power.

Indeed, just like Labour governments in Britain, the PS/PC government in France hopes to exploit its links with the unions to keep wages down and is publicly boasting that it will be better able to get the unions to co-operate in this than the opposition parties. And it is true that when the previous "right wing’’ government decided in September 1976 to block prices for 3 months it didn't dare block wages as well, as the present "left wing" government has done, limiting itself simply to asking employers not to offer excessive wage increases. But even this brought trade unionists out on to the streets proclaiming "No to Austerity". History shows that allegedly "socialist” governments in all countries are better able to impose austerity on workers than openly capitalist ones. (A case could even be made out for saying that this is their role within capitalism.) What is happening in France today is a further confirmation of this rule.

Two further points must however be made. First, in a period of high unemployment real wages (what wages can buy) will tend to be under pressure anyway for purely economic reasons, irrespective of government policy or of whether the union leaders betray their members or not. Second, if inflation of the currency continues, then nominal money wages will go on rising, once again irrespective of what governments and union leaders may or may not do. But government action to try, in the one case, to reinforce downward pressures on real wages and, in the other, to try to counter the upward pressures on nominal wages clearly reveals that all governments are forced to run capitalism in the only way it can be — against the interests of the wage and salary earning majority. A sustained policy of increasing “popular consumption” under capitalism must sooner or later restrict popular consumption to protect profits.

Actually, as we pointed out in the article last August, Delors did not have such a simplistic solution to the economic crisis as the PCF, the CGT trade union and some of his PC colleagues — that economic activity could he revived by giving people more money to spend. He realised that the French economy was part of the world economy and that a revival in France could not be sustained without a revival in the world capitalist economy. But he too was naive in believing, without any reasonable grounds for doing so, that this world revival would occur within a year and that therefore the French government could safely "reflate” its economy (print more money to finance government spending) in anticipation. In June last year he declared that "the reflation measures already taken by the government . . . are a limited anticipation of the recovery of the world economy which the experts foresee for the end of this year or the beginning of next (The Times, 24 June 1981).

The end of 1981 came, but there was no world recovery. The months of 1982 passed, still no world recovery. The "experts” began to creep back into their holes. Meanwhile, as a direct result of the government's spending financed by the printing press, the rate of inflation remained higher in France than in other countries. . . leading eventually to the devaluation of 12 June and the current austerity measures.

When Prime Minister Pierre Mauroy announced the devaluation he could only remark pathetically that his government had done what it could "but the international recovery was not at the rendez-vous”. It takes two to make a rendez-vous and the PS/ PC government has found out the hard way that governments are in no position to impose a rendez vous on the capitalist economy. Capitalism is a world system which operates according to its own economic laws, going through its regular boom-slump. boom-slump cycles, irrespective of what governments may or may not do. It is true however that, while governments can do nothing to bring about a recovery before it would normally occur, they can. as Marx pointed out. make things worse by mistaken monetary policies, as the present French government just seems to have done. Mauroy would have been better to have employed some other metaphor: "we took a risk and we lost" or "we took a leap in the dark and fell flat on our faces". Or even Harold Wilson's "we were blown off course”!

This utter failure of the PS/PC government in France is yet another confirmation of our contention that capitalism can never be made to work in the interests of the wage and salary earning majority. It is a profit-making system based on the exploitation of wage-labour and can only function as such, whatever the political colour the government may happen to have. Any party which takes on the responsibility for governing under capitalism is sooner or later forced, whether it originally intended to or not, to respect the economic logic of capitalism which decrees that profits must come before wages, that the consumption of the wage and salary earning class must be limited so as to allow profits to be made.

Mitterrand's failure is proof that reformism is a futile waste of time. Since the Labour Party’s economic policy resembles very closely that pursued by Mitterrand until 12 June, there's a lesson here for workers in Britain too.

Adam Buick (Luxemburg)

War fair (1982)

From the August 1982 issue of the Socialist Standard

One feature of the Falklands conflict which caused the jingoists to boil over with ill-directed wrath was the fact that some of the armaments used by the Argentine forces had been made in Britain or EEC "partner" countries. Some details are given in a recent New Statesman article by Duncan Campbell, under the extremely confused title of "No Lesson Learnt" (21 June 1981). Campbell tells us how

Ferranti workers in Edinburgh and Manchester made the Isis bombing sights with which the Argentine Skyhawks were fitted . . . Their French counterparts at Bourges made the Exocets. Sterling Armaments of Dagenham sold the Argentines some 100 submachine guns seven years ago, which turned up at Goose Green.

Later in the same article, we learn that Sterling Armaments and Ferranti were among the exhibitors at last month's British Army Equipment Exhibition, a bi-annual international arms sale held at Aldershot. Campbell writes:

In 1976. just three months after we had broken off diplomatic relations .  . . two Argentine generals came to Aldershot. In 1978 ten officers came. In 1980. after the restoration of diplomatic links, five generals visited Britain. The Ministry of Defence even paid their air fares . . . Every other military dictatorship from Turkey to the Americas got the same treatment.

Unexpectedly, no reformist cries for "control" appear in the text, although the title does hint at a belief in such "solutions". On a note of unusual realism. Campbell signs off by saying: "There is no sign from Britain or anywhere else in Europe that the Falklands war will have changed the world of arms dealing”.

Those who express patriotic anger at such revelations are probably unaware that history provides many examples of arms sales to the "enemy", and of those not directly involved in a conflict selling the machines of death to both sides. Even in the Middle Ages, mercenary soldiers took whichever side could offer them employment at the time. After the Industrial Revolution, however, the arms trade gathered pace.

Alfred Nobel, like many of the early giants of this business, was a complex character. Idealist, pacifist and admirer of Shelley (in whose style he enjoyed writing poetry), he was also a ruthless financier obsessed with the science of explosives. He is. of course, best known as the originator of the Nobel Peace Prize, a fitting testament to his contradictory nature: fewer people realise that he was one of the earliest to subscribe to the deterrent theory. At the Berne Peace Congress of 1892 he explained his viewpoint to Bertha von Suttner, Austrian aristocrat, authoress and pacifist, who had earlier applied to be his private secretary: “My factories may end war sooner than your Congress. The day when two army corps can destroy each other in one second, all civilised nations will recoil in horror from war” (The Arms Bazaar, Anthony Sampson). Nobel's nightmare vision of destructive power is now all but come to pass, but with no sign of the response for which he apparently hoped. However this philosophy provided an excellent justification for a man who had made his fortune out of the arms race. Sampson believes that Nobel was Bernard Shaw's model for the character of Andrew Undershaft in his play Major Barbara. Undershaft, however, explicitly rejects the deterrent theory when his son-in-law puts his point of view to him: "I am obliged to you for making the usual excuses for my trade, but I’m ashamed of it. I am not one of those men who keep their morals and their business in watertight compartments". There have been both types in the arms trade. Whether the capitalist provides his own justification or relies on others makes very little difference.

Alfred Krupp was a less complicated person than Nobel. In 1866 he insisted, against the wishes of Bismarck, on exporting guns to Austria, which were very soon in use against Prussia in the Austro- Prussian War. Shortly afterwards, despite having just raised a loan from the King of Prussia. Krupp tried to export his guns to France and failed only because the complacency of the French generals stood in his way. At the turn of the century Sir Basil Zaharoff, in his role as master salesman for Vickers, had considerable success travelling between opposing Balkan states — Greece and Turkey — to escalate orders from both sides. In the First World War the Maxim gun, sold by Sir Hiram Maxim to Germans, Austrians and Italians, was the prototype for the guns which fired from all sides on the Western Front. In Russia, Krupp guns fired on German soldiers and the Belgian army had been stocked from the same source. At sea both sides fired shells with Krupp fuses, and after hostilities ceased Krupp’s successfully sued Vickers for payment of royalties on its shells.

All this nefarious traffic inevitably spawned pressure for control on arms sales and for nationalisation of the industry. Even staunch capitalist defenders of “free enterprise” did not wish to see organisations from within their own territory supplying arms to a potential enemy. Whatever the views of the individuals involved, the development of capitalism led inevitably to attempts by the state machine to interfere with the freedom of the private arms manufacturers to sell to whomsoever their immediate interests dictated. The League of Nations, as ineffective before World War One as the United Nations has been since 1945, passed resolutions such as that of December 1933: “That it is contrary to the public interest that the manufacture and sale of armaments should be for private profit”.

The United States Congress, following the report of the Nye Committee of investigation into the arms business, passed in August 1935 a Neutrality Bill which compelled the President, in the event of war between foreign countries, to apply an arms embargo. The hearings of the Nye Committee were freely quoted by the British Labour Party in support of its demands for nationalisation, yet the ineffectiveness of control “remedies” had already been revealed during the Manchurian crisis of 1931. In that year Japan invaded Manchuria, then part of China, in the face of condemnation from Britain and the League of Nations and a boom in British arms exports to both sides ensued. For a couple of weeks the British government imposed an arms embargo. Duff Cooper, then Financial Secretary to the War Office, described the situation thus: "In a fortnight we took off the embargo, but during those weeks we lost a great many orders. China and Japan did not get less munitions, but men in this country got less work, less food, less employment". Thus Duff Cooper, like Alfred Nobel, used an argument more common today than in his own time. The concern of the capitalist over loss of profit is. with varying degrees of hypocrisy and cynicism, masked as sympathy for the workers thrown onto the streets as a result of unemployment. More recently the Arab-Israeli conflict and the Middle East turmoil in general have provided further examples of duplicity. French pressure in 1969 forced Dassault, previously a generous supplier of Israel, to sell Mirage jets to Libya. Significantly the main reason was the need to ensure continuing supplies of oil.

Why does this destructive absurdity continue? The answer lies in the nature of the capitalist system itself. Unsold stocks of any commodity are a dangerous embarrassment to the owners of the means of wealth production. If the value embodied in these goods cannot be converted into cash, profits are lost and, in some cases, bankruptcy results. In the last resort this desperate pressure to sell in the face of cut-throat competition from rivals drives capitalist governments into war. This pressure of course applies in the final analysis as much to government controlled industries.

Under capitalism alliances between stales are often of a transitory nature. Japan was an ally of Britain and America in 1914-18, but fought against them in 1941-45. And despite the long-standing Falklands dispute, Argentina was not regarded as an enemy until the time of the invasion. Despite recent technological advances in the means of destruction, some comparatively old weapons are still effective, particularly in small scale wars. The Canberra bomber, the design of which started as early as 1945, helped India "liberate” Bangladesh in "Mrs. Gandhi’s War” in 1971. This aeroplane and the Lightning (1960) are much in evidence in South American air forces and are indeed not yet completely phased out of the RAF. The variability of capitalist alliances and the long life of some weapons obviously increase the danger of supplying a potential enemy with the means to hit you hard. Weapons bought with one purpose in mind can easily be put to another use. The guns from Sterling Armaments which turned up seven years later at Goose Green may well have been purchased for domestic rather than "anti-colonial” use. Campbell reports that "five were fitted with silencers, which reduce the performance of the bullets too much for conventional military use”. Probably they were intended for use against workers at home rather than abroad.

There is however yet another reason why, even with government control of arms production, sales opportunities abroad cannot be lightly spurned, even if embarrassment is risked in the process. The capitalist class has the problem of how to maintain in peacetime the capacity to produce armaments in an emergency. To convert too many factories to other products such as kidney machines would clearly put this capability at risk. In February 1935, Bernard Baruch, adviser to Franklin Roosevelt, spelled out his government’s policy with brutal frankness:

The only expedient yet used is for the governments of industrial countries at least not to discourage (and I fear almost universally to encourage) the manufacture of lethal weapons for exportation to belligerent countries actively preparing for war. but which have an insufficient munitions industry or none at all. Without specific evidence 1 still conjecture that the Nye investigation will disclose that our Government has not operated on a different policy. To put it bluntly, this is a method of providing a laboratory to test killing implements and a nucleus for a wartime munitions industry by maintaining an export market for instruments of death. Of course, it is absolutely indefensible and we could not be put in a position of excusing it.

This really says it all.

E. C. Edge

Running Commentary: Profit interfering (1982)

The Running Commentary column from the August 1982 issue of the Socialist Standard

Profit interfering

Sanofi, the pharmaceuticals division of the French Elf Aquitaine oil group, is suspending production of Interferon, the experimental drug used in cancer treatment. The reason they have given for this decision is that sales levels have been disappointing and there has been a steady build-up of stocks. Even the usefulness of trying to develop a treatment or even a cure for cancer cannot escape the law of all production under capitalism — that without the prospect of profit, production must cease.

Last year, the Imperial Cancer Research Fund collected about one million pounds in charity for further research into Interferon. In the same year, the governments of the world spent about the same amount every two minutes on the production of armaments.

Scientists investigating Interferon in different countries have not combined their research data, because the separate corporations who sponsor them each hope to monopolise the enormous profits which might become available if the formula were perfected.

Sales of food, electricity and many other goods and services have been "disappointing” lately, resulting in widespread cutbacks in production. In none of these cases is there a lack of demand, of real need. Last year, thirty million people starved to death. What is lacking is “effective” market demand, that is, needs backed up by money. As usual, the world profit system is failing to meet human needs.

Gay power

The gays of Britain should beware. They are about to be hounded and harassed with an intensity which will make the attention they receive from Chief Constable Anderton of Greater Manchester seem aloof and apathetic.

As W. H. Smith agree to a wholesale distribution of Gay News, an apparently startling — although actually obvious—fact emerges. Gay workers are more than a deviant, oppressed, discriminated-against minority. They are also a market. The new publisher of Gay News has been specific about this. Consulting a recent detailed survey (see what we mean about being hounded?) he puts “. . . the spending power of gay men and women conservatively at about £5,000 million. It's a virtually untapped market”.

Among the first to try to exploit this is a give-away newspaper, Capital Gay. which goes out through gay pubs, clubs and the like. In common with other free papers — which are usually local in their scope — Capital Gay is little more than advertisements garnished with a few news items. Of course, some gays may object to being treated as a separate market, with special appeals to their sexual preferences. They may prefer to be lumped in with all the other workers who trawl their depressed way through the sub-standard goods in their local supermarkets. But being a lucrative market may do more for gays than any amount of protest and propaganda. In a society which produces all its wealth as commodities, the market has the power to overwhelm the most maniacal police chief or other self-appointed guardian of public morals.

Perhaps this will be called progress. Anyone with an awareness of the structure of capitalist society, and of what this does to human beings, will know that discrimination against gays is another aspect of class-based humiliation. Sexual freedom, like all other freedoms, can be secure only in a social order based on common interests.

Asbestos awards

When considerations of human well-being, even of life and death, come directly into conflict with the needs of capital to accumulate profit, the latter generally wins. There are countless examples to demonstrate this. When such conflicts occur, the companies involved are curiously adept at evading the implications.

Two hundred and fifty insulation workers in Illinois are reported by doctors to have died or become seriously ill after working with brown asbestos, amosite, supplied by North American Asbestos. An American court found against the British parent company, Cape Industries, for having knowingly supplied an extremely dangerous substance without warning, and fined them for £32 million damages.

Cape will not pay this money, since the award is not enforceable in Britain, where they face many other such charges, having been named in 900 cases. In the American case, however, they took more elaborate precautions than ever to avoid having to pay money out of the profits made from those workers' deaths.

Cape’s parent company. Charter Consolidated, is the London associate of the Anglo-American Corporation of. South Africa, with mining interests in America. In January 1978, after paying out one million dollars in an asbestos case in Texas, Cape liquidated its North American Asbestos Corporation, which had also supplied the amosite used by the workers who died in Illinois.

But Cape continued to own shares in the Liechtenstein-based Associated Mineral Corporation, which supplied asbestos to Continental Products, who operated from the same Chicago address which had been used by the North American Asbestos Corporation. (Guardian, 6 July 1982; World in Action, Granada TV, 5 July 1982.)