What classless society? (2005)

The Cooking the Books column from the April 2005 issue of the Socialist Standard

At one time, a long time ago now, when the Labour Party still retained some sort of vague commitment to being opposed to the workings of capitalism it used to say that it favoured the redistribution of wealth from the rich to the poor. They were going (they said) to establish a more equal society by taxing the rich and using the money to provide better public services for the rest of us.

Actually, in the last century there was a long-term trend towards a less uneven distribution  of wealth ownership. But this did not result from any deliberate policy on the part of governments (the wealthy soon found ways of minimising or avoiding taxes on their existing wealth and on their accumulation of more wealth), but rather from a majority of people coming to own more consumer goods, etc. resulting in the total amount of wealth owned by the non-rich sections of society rising faster than the total amount owned by the wealthy.

The rich still got richer – and, in absolute terms, each one of them got more than each of the rest of us – but, proportionately, together they got less than the rest of us as a group. There was no redistribution from them to us; which would have gone against the logic of capitalism involving as it does the accumulation of more and more capital in the hands of a capitalist class.

In the 1990s this long-term trend (which continued even under Thatcher) was reversed. Since 1991 the rich have been getting richer faster than the rest of us – despite a Labour government. In December the Office for National Statistics published the figures for the latest available year, 2002. Two sets of figures are published, one for all marketable wealth and the other for ““marketable wealth less value of dwellings”. Since capitalism is based on the concentration of the ownership of the means of wealth-production  in the hands of a tiny minority, and since houses are not means of production, it is the second set of figures that are the more relevant (even if they still include other items of wealth such as cars and hi-fi equipment that are also not means of production),

These figures (published on the ONS website at  http://www.statistics.gov.uk/cci/nugget_print.asp?ID=2  show how things have changed since 1996, as the situation inherited by the present Labour government when it came into office:

                                     1996  1999 2000 2001 2002

Top 1% owned               26      34     33     34     35

Top 5%                           49      59     59     58     62

Bottom 95%                    51      41     41     42     38

Bottom 50%                      6       3        2       2       2

As can be seen, whereas in 1996 the top 5 percent owned as much as the bottom 95 per cent - or one out of every 19 persons owned as much as the other 19 (of whom half owned virtually nothing) taken together - by 2002 the top 5 percent owned nearly 40 percent than the rest of us.

Who says that we’re living in a classless society? Who says that the capitalist class have died out? Who says that the Labour Party can deliver a more equal society or is even trying to?

Einstein and Socialism (2005)

From the April 2005 issue of the Socialist Standard

This year sees a double anniversary for Albert Einstein: fifty years this month since his death, and one hundred since the publication of his first seminal papers on quantum theory and relativity. No doubt there will be fulsome, and well-deserved, tributes to one of the great names of twentieth-century science. But it is likely that there will be little if any reference to Einstein’s political views, especially his opposition to capitalism, including his acceptance of the labour theory of value.

In 1949, Einstein published an article ‘Why Socialism?’ in the first issue of the American left-wing journal Monthly Review. It is available on the web at various places. e.g. here.  In it he argued that class society is an instance of ‘the predatory phase’ of human development (in Thorstein Veblen’s phrase). Yet humans depend on society to provide food, clothing, a home and so on. We have a fixed and unalterable biological constitution, but during our lives we acquire a ‘cultural constitution’ which is subject to change. Anthropological research shows that people’s social behaviour differs greatly, so our biological make-up does not determine the way we live.

But small groups of humans cannot be self-sufficient: ‘mankind constitutes even now a planetary community of production and consumption.’ This dependence on society, however, is seen as a threat to our existence rather than as a positive asset. This is largely due to ‘the economic anarchy of capitalist society’. All those who do not share in the ownership of the means of production, Einstein calls workers. Workers’ wages are determined not by the value of what they produce but by their minimum needs. As private capital becomes more and more concentrated, it achieves a power that even democratic politics cannot check.

Under capitalism, he continues, production is for profit, not use. Unemployment exists almost always, and workers are in fear of losing their jobs. Unlimited competition results in an enormous waste of labour. The worst evil of capitalism, he says, is the ‘crippling of individuals’, as education inculcates competitive notions.

Having given a pretty decent sketch of how capitalism works and of what’s wrong with it, Einstein goes on to advocate a planned economy which guarantees a livelihood to everyone and adjusts production to the needs of the community. But a planned economy, he recognises, is not socialism, as it may involve ‘the complete enslavement of the individual’ (so perhaps he had Russian-style state capitalism in mind?). And after a few misguided remarks about so-called problems of socialism (how to limit the power of the bureaucracy? etc), Einstein closes his contribution. It’s a shame that he is so inconclusive, but his article is still well worth reading, even if you can’t get through it at the speed of light.

Paul Bennett

The other Adam Smith (2005)

The Cooking the Books Column from the April 2005 issue of the Socialist Standard

Gordon Brown grew up in the Scottish seaside town of Kirkcaldy where his father was a minister in one of the local kirks. Adam Smith was born there in 1723, though his father was a customs official. In February, at Brown’s invitation, Alan Greenspan, chairman of the US Federal Reserve Board, visited Kirkcaldy to deliver a lecture on Adam Smith.

Smith’s Wealth of Nations was, said Greenspan, “one of the great achievements in human intellectual history”. Smith’s view that capitalists should be allowed by governments to pursue profits unhindered since, “led by an invisible hand”, this resulted in the “public good” being promoted had, he argued, became “the sole remaining effective paradigm for economic organisation” (Times, 7 February).

That’s the side of Smith that is promoted by free-marketeers such as the Adam Smith Institute. But that’s only one side of his theories. Do the free-marketeers – does Greenspan – know that the Wealth of Nations opens with a declaration that useful things are produced by labour: “The annual labour of every nation is the fund which originally supplies it with all the necessaries and conveniences of life which it annually consumes”? Or that Smith went on to expound a labour theory of value: “Labour is the real measure of the exchangeable value of all commodities” (Book I, chapter V)?

Smith even went so far as to identify profits as deriving from the value added by workers in the process of production:

“As soon as stock has accumulated in the hands of particular persons, some of them will naturally employ it in setting to work industrious people, whom they will supply with materials and subsistence, in order to make a profit by the sale of their work, or by what their labour adds to the value of the materials . . . The value which the workmen add to the materials . . . resolves itself . . . into two parts, of which one pays their wages, the other the profits of their employer upon the whole stock of materials and wages which he advanced” (Book I, chapter VI).

Smith’s labour theory of value was refined by David Ricardo and used by early critics of capitalism to argue that the capitalists were exploiters who robbed the workers of a part of the product of their labour. Marx took over and further developed this labour theory of value as the basis for his analysis of capitalism which saw the capitalists’ pursuit of profit as seeking to extract a maximum of unpaid labour from the working class.

The “public good” which Smith argued was promoted by letting capitalists pursue profits was an increase in the total amount of wealth in existence. Marx didn’t deny this, but argued that under capitalism this increase was inevitably unevenly divided: more went to capitalists as accumulated capital than to the actual wealth-producers as increased wages (if that). What Smith’s “invisible hand” did, if you like, was to build-up in this way the material basis for a socialist society of common ownership and democratic control. Which is the “sole effective paradigm” for ensuring that the productive forces built up under capitalism can be used for the benefit of all.

What Socialism Means (2005)

From the April 2005 issue of the Socialist Standard

Although the word socialism is itself more or less modern, its meaning can be said to go back to early religious sects of the ancient world and was taken up by religious dissidents in mediaeval times. Words attributed to John Ball during the Peasants' Revolt of 1381 capture its meaning very well:

"My friends, things cannot go well in England, nor ever, until everything shall be held in common, when there shall be neither vassal nor lord and all distinctions levelled, when lords shall be no more masters than ourselves."

But it was not until the 19th Century that the concept of socialism (or communism) was developed by utopian socialists and then more systematically by Marx and Engels. Since the early 19th Century socialism has meant an alternative, classless society which can be set out under three main headings as follows:-

1. Common Ownership.
2. Democratic Control.
3. Production solely for use.

These features of socialist society would be dependent on each other and could only operate together as basic parts of an integrated social system. In combination, these define a way of organising society that in every important aspect of production, distribution, decision making and social administration, is clearly distinguished from the operation of capitalist society.

1. Common ownership means that the entire structure of production and all natural resources be held in common by all people. This means that every person will stand in equal relationship with every other person with respect to the means of producing the things we need to live, that is, mines, industrial plants, manufacturing units, all land and farms, and all means of transport and distribution. This also means the common ownership of all natural resources. Perhaps "common ownership" is partly a misnomer because what is meant is that means of production and resources would not be owned by anyone. In place of the property relationships of owners and non-owners, means of production will simply be available to the whole community to be used and developed solely for the needs of all people.

2. Democratic control means that social policy would be decided by communities. In place of rule by governments, public decisions would be made by people themselves. One great advantage of democratic practice in socialism would be not only the organisation of decision making but also the freedom to carry out those decisions. This freedom of action would arise from direct control of community affairs following the enactment of common ownership and removal of the economic constraints of the capitalist system. Without powers of action decision-making is meaningless.

3. Production solely for use means just what it says. People in socialism would be free to co-operate voluntarily with each other in producing goods directly for the needs of the community. This would be useful labour co-operating to produce useful goods solely for consumption. Production solely for use would replace production for sale at a profit. Things produced for sale under the capitalist system are of course intended to supply a need of one kind or another but as commodities they are produced primarily with a view to money gain and the increase of money capital. As a general rule the market system is a system of 'no profit no production'. In socialism this profit motive would be entirely removed. In a moneyless socialist society the factors of production would operate only in a useful form and not as economic categories with a price. Labour would not be wage labour serving the interests of an employer but would be free labour. People at work would be creating only useful things and not economic values from which profit is derived.

There should be no doubt that these basic features that define socialism clearly distinguished it from the capitalist system. Common ownership of means of production would be in direct opposition to private, corporate or state ownership; democratic control would be fundamentally different from rule by governments; production for needs would be in direct opposition to production for sale at a profit. These contrasting features of the two systems cannot be operated together; they are mutually exclusive. The mistaken idea that they can be operated together has been a major cause of political confusion about what socialism means.

Production solely for needs
What is meant by needs should not be understood as mere personal consumption. It should not suggest a rampant consumerist culture. Production for needs would include a wide range of considerations such as the need to protect and conserve the environment. In defining socialism we should emphasise that it will provide for one vital need in a way that is impossible under the capitalist system. This is the need of peoples throughout the world to bring the organisation of their community affairs under their own democratic control and to develop them in the interests of the whole community.

It was with the emergence of the capitalist system that society lost its direct control of its productive resources. In previous societies, accepting that they were ruled by privileged classes in their own interests, it was often the case that production was at near maximum capacity given the technology and resources available and this determined what could be distributed. In times of good harvests the whole community could benefit in some shape or form. But with the development of the capitalist system this was eroded as what is produced depends crucially on what can be sold. This means that distribution through sale in the markets determines production and this is always less than what could be produced.

Market capacity is inherently unpredictable. If too many goods are produced for a market and they remain unsold, a crisis and recession may occur with reduced production, increased unemployment, bankruptcies, and large scale writing-off of capital values. Despite the many attempts that have been made, no theory of economic management has ever been able to predict or control the anarchic conditions of the market system. This is rule by market forces which serve minority interests and which generate the insecurities, crises and conflicts that shape the way we live. The fact that we have great powers of production that cannot be organised and fully used for the benefit of all people has devastating consequences and is at the root of most social problems.

In this way, the capitalist system places the production of goods and services, on which the quality of all our lives depends, outside the direct control of society. Contrary to this, a socialist system would bring the entire organisation of production and distribution under democratic social control.

Social class
A further basic distinction between the two systems is that whereas the capitalist system is inherently class ridden, in socialism, social relationships of common ownership and equality will end class divisions. Much discussion of class centres on various sociological differences between groups which may be useful for some purposes. However, sociological differences can tell us little when seeking to explain how production is organised.

Some evidence may suggest, superficially, that we live in a society of greater equality. For example, we can accept that not so long ago "toffs" were people who played golf and went on motoring holidays, touring the Continent. Now, many people from all walks of life do these things. This shows that these pursuits have become relatively cheaper and that some working people are now able to enjoy them, but this in no way alters the economic relationships of production. It does not alter the economic, class relationship between capital and labour which dominates the way we live. At the point of production, the workers and their employers who may be sharing a golf course in their leisure time remain in a relationship of conflicting economic interests which, whilst it continues, must always condemn our society to the class divisions of strife and to the many ugly comparisons that we see of poverty amidst luxury. Class is a social relationship that invades and has a corrupting influence on every part of our lives.

An economic definition of class based on the categories of capital and labour in a system of commodity production is basic to our explanation of how we produce and distribute wealth and the economic motives that are involved. Social class defined as economic relationships is a key to how the operation of the market puts profit before needs and places constraints on all our activities. Our lives and the quality of our society depend upon our relationships of production and on the services we can provide. An analysis using economic/class categories tells us who gets what from the pool of wealth that is made available and how a privileged class has accumulated great wealth and property; it therefore explains the great social differences that we see about us.

In addition, we find that increasingly, giant global corporations own and control the world production of goods and services together with the natural resources of the planet. The sole object is to amass greater concentrations of capital and to increase their economic and political powers.

We live in a society of deep class divisions with a conflict of economic interests between those who work the productive system and those who own it. This economic conflict can only be reconciled by the relationships of equality and cooperation that would integrate the community in socialism.

Whilst it is right to feel outrage at the great class divisions that exist socialists do not come to this question in a negative spirit of class hostility. The aim is to end it. Class conflict has gone on for too long; there has been too much strife and we have to heal the wounds of history through entirely democratic means.

Class society is both morally and materially indefensible. It need not linger on and on as part of an outdated system. An ethical society would be one in which all people would live their lives, free from the disadvantages of under privilege and class injustice. To live in a classless society would be in the interests of all its members. Freedom for every person to develop their skills and talents on equal terms could benefit everyone. Equality has the potential to enrich all our lives and would be a basis for a true community of shared interests.

Socialism - a human-centred way of life
Having set out what socialism means, and having set out features that distinguish it clearly from capitalism, these can be summarised as one all important difference. Whereas the capitalist system works for sectional economic ends that are alien to the interests of the whole community, a socialist system would be wholly dedicated to the interests of all people. There would also be a difference of complexity and simplicity. Whereas, working within the complex economic limitations of the market system, our endeavours are frustrated and often blocked by the barriers of costs, in a socialist society, communities would be free to set up their goals and then organise their resources of labour, materials and technology to achieve them in a straightforward way. People in socialism would need only to work with the material factors of production and not any economic factors.

Given the control of human affairs that a socialist system would bring, people in socialism would be able to take charge of their destiny. What is undeniable is that we are a species with great talents. In science, technology, in art, crafts and design we can call upon a wide range of great skills. The point now is to release these for the benefit of humanity.

Pieter Lawrence

What Socialism Means (2005)

From the April 2005 issue of the Socialist Standard

Although the word socialism is itself more or less modern, its meaning can be said to go back to early religious sects of the ancient world and was taken up by religious dissidents in mediaeval times. Words attributed to John Ball during the Peasants' Revolt of 1381 capture its meaning very well:

"My friends, things cannot go well in England, nor ever, until everything shall be held in common, when there shall be neither vassal nor lord and all distinctions levelled, when lords shall be no more masters than ourselves."

But it was not until the 19th Century that the concept of socialism (or communism) was developed by utopian socialists and then more systematically by Marx and Engels. Since the early 19th Century socialism has meant an alternative, classless society which can be set out under three main headings as follows:-

1. Common Ownership.
2. Democratic Control.
3. Production solely for use.

These features of socialist society would be dependent on each other and could only operate together as basic parts of an integrated social system. In combination, these define a way of organising society that in every important aspect of production, distribution, decision making and social administration, is clearly distinguished from the operation of capitalist society.

1. Common ownership means that the entire structure of production and all natural resources be held in common by all people. This means that every person will stand in equal relationship with every other person with respect to the means of producing the things we need to live, that is, mines, industrial plants, manufacturing units, all land and farms, and all means of transport and distribution. This also means the common ownership of all natural resources. Perhaps "common ownership" is partly a misnomer because what is meant is that means of production and resources would not be owned by anyone. In place of the property relationships of owners and non-owners, means of production will simply be available to the whole community to be used and developed solely for the needs of all people.

2. Democratic control means that social policy would be decided by communities. In place of rule by governments, public decisions would be made by people themselves. One great advantage of democratic practice in socialism would be not only the organisation of decision making but also the freedom to carry out those decisions. This freedom of action would arise from direct control of community affairs following the enactment of common ownership and removal of the economic constraints of the capitalist system. Without powers of action decision-making is meaningless.

3. Production solely for use means just what it says. People in socialism would be free to co-operate voluntarily with each other in producing goods directly for the needs of the community. This would be useful labour co-operating to produce useful goods solely for consumption. Production solely for use would replace production for sale at a profit. Things produced for sale under the capitalist system are of course intended to supply a need of one kind or another but as commodities they are produced primarily with a view to money gain and the increase of money capital. As a general rule the market system is a system of 'no profit no production'. In socialism this profit motive would be entirely removed. In a moneyless socialist society the factors of production would operate only in a useful form and not as economic categories with a price. Labour would not be wage labour serving the interests of an employer but would be free labour. People at work would be creating only useful things and not economic values from which profit is derived.

There should be no doubt that these basic features that define socialism clearly distinguished it from the capitalist system. Common ownership of means of production would be in direct opposition to private, corporate or state ownership; democratic control would be fundamentally different from rule by governments; production for needs would be in direct opposition to production for sale at a profit. These contrasting features of the two systems cannot be operated together; they are mutually exclusive. The mistaken idea that they can be operated together has been a major cause of political confusion about what socialism means.

Production solely for needs
What is meant by needs should not be understood as mere personal consumption. It should not suggest a rampant consumerist culture. Production for needs would include a wide range of considerations such as the need to protect and conserve the environment. In defining socialism we should emphasise that it will provide for one vital need in a way that is impossible under the capitalist system. This is the need of peoples throughout the world to bring the organisation of their community affairs under their own democratic control and to develop them in the interests of the whole community.

It was with the emergence of the capitalist system that society lost its direct control of its productive resources. In previous societies, accepting that they were ruled by privileged classes in their own interests, it was often the case that production was at near maximum capacity given the technology and resources available and this determined what could be distributed. In times of good harvests the whole community could benefit in some shape or form. But with the development of the capitalist system this was eroded as what is produced depends crucially on what can be sold. This means that distribution through sale in the markets determines production and this is always less than what could be produced.

Market capacity is inherently unpredictable. If too many goods are produced for a market and they remain unsold, a crisis and recession may occur with reduced production, increased unemployment, bankruptcies, and large scale writing-off of capital values. Despite the many attempts that have been made, no theory of economic management has ever been able to predict or control the anarchic conditions of the market system. This is rule by market forces which serve minority interests and which generate the insecurities, crises and conflicts that shape the way we live. The fact that we have great powers of production that cannot be organised and fully used for the benefit of all people has devastating consequences and is at the root of most social problems.

In this way, the capitalist system places the production of goods and services, on which the quality of all our lives depends, outside the direct control of society. Contrary to this, a socialist system would bring the entire organisation of production and distribution under democratic social control.

Social class
A further basic distinction between the two systems is that whereas the capitalist system is inherently class ridden, in socialism, social relationships of common ownership and equality will end class divisions. Much discussion of class centres on various sociological differences between groups which may be useful for some purposes. However, sociological differences can tell us little when seeking to explain how production is organised.

Some evidence may suggest, superficially, that we live in a society of greater equality. For example, we can accept that not so long ago "toffs" were people who played golf and went on motoring holidays, touring the Continent. Now, many people from all walks of life do these things. This shows that these pursuits have become relatively cheaper and that some working people are now able to enjoy them, but this in no way alters the economic relationships of production. It does not alter the economic, class relationship between capital and labour which dominates the way we live. At the point of production, the workers and their employers who may be sharing a golf course in their leisure time remain in a relationship of conflicting economic interests which, whilst it continues, must always condemn our society to the class divisions of strife and to the many ugly comparisons that we see of poverty amidst luxury. Class is a social relationship that invades and has a corrupting influence on every part of our lives.

An economic definition of class based on the categories of capital and labour in a system of commodity production is basic to our explanation of how we produce and distribute wealth and the economic motives that are involved. Social class defined as economic relationships is a key to how the operation of the market puts profit before needs and places constraints on all our activities. Our lives and the quality of our society depend upon our relationships of production and on the services we can provide. An analysis using economic/class categories tells us who gets what from the pool of wealth that is made available and how a privileged class has accumulated great wealth and property; it therefore explains the great social differences that we see about us.

In addition, we find that increasingly, giant global corporations own and control the world production of goods and services together with the natural resources of the planet. The sole object is to amass greater concentrations of capital and to increase their economic and political powers.

We live in a society of deep class divisions with a conflict of economic interests between those who work the productive system and those who own it. This economic conflict can only be reconciled by the relationships of equality and cooperation that would integrate the community in socialism.

Whilst it is right to feel outrage at the great class divisions that exist socialists do not come to this question in a negative spirit of class hostility. The aim is to end it. Class conflict has gone on for too long; there has been too much strife and we have to heal the wounds of history through entirely democratic means.

Class society is both morally and materially indefensible. It need not linger on and on as part of an outdated system. An ethical society would be one in which all people would live their lives, free from the disadvantages of under privilege and class injustice. To live in a classless society would be in the interests of all its members. Freedom for every person to develop their skills and talents on equal terms could benefit everyone. Equality has the potential to enrich all our lives and would be a basis for a true community of shared interests.

Socialism - a human-centred way of life
Having set out what socialism means, and having set out features that distinguish it clearly from capitalism, these can be summarised as one all important difference. Whereas the capitalist system works for sectional economic ends that are alien to the interests of the whole community, a socialist system would be wholly dedicated to the interests of all people. There would also be a difference of complexity and simplicity. Whereas, working within the complex economic limitations of the market system, our endeavours are frustrated and often blocked by the barriers of costs, in a socialist society, communities would be free to set up their goals and then organise their resources of labour, materials and technology to achieve them in a straightforward way. People in socialism would need only to work with the material factors of production and not any economic factors.

Given the control of human affairs that a socialist system would bring, people in socialism would be able to take charge of their destiny. What is undeniable is that we are a species with great talents. In science, technology, in art, crafts and design we can call upon a wide range of great skills. The point now is to release these for the benefit of humanity.

Pieter Lawrence

The Rise and Fall of the NHS (2005)

From the April 2005 issue of the Socialist Standard

The National Health Service is trumpeted as the finest achievement of the Labour Party throughout its entire history. For years Labour supporters when tackled on the non-socialist and pro-capitalist nature of the Labour Party would reply with the one riposte, 'Ah, but what about the NHS?' Regarded by many Labour supporters as a socialist measure and holding out a promise of solving one of the most distressing problems of being a worker, being looked after when you were ill, it is hardly surprising that it was seen as a huge step forward in working class emancipation. One reform out of the multitude of reforms put into practice by a reformist party has survived — has it worked?

What did the NHS claim to do at its inception? Its chief architect Aneurin Bevan was very sure of his aims: it was to be an institution which would take care of all the medical needs of the working class for evermore and, hold your breath, without charge. However expensive the treatment might be medical attention could be obtained for all. For free! But it left a question hanging in the air, why was it only the working class who needed this ambitious solution? There was no problem for the capitalist class, who didn't need a health service. They could obtain all that was available from existing medical services by paying for it.

However, in the context of the time and given the pro capitalist inclinations of the Labour Party it was a bold, even visionary solution to the poor state of health of the mass of the working class after a long period of economic depression followed by six years of war. A situation, that had already been a serious cause of concern for government before the war. (Though in some respects the wartime diet plus the fact that unemployment had virtually ended for the duration had improved health standards). The NHS plan struck an immediate chord with the mass of the working class who saw in it a promise for massive changes for the better in the post-war period. Carried away by the prospect of free teeth and glasses for all, the NHS helped to allay the grim years of rationing and shortages and helped to secure a second term for the Labour Government.

Bevan is usually given sole credit for the NHS, but the real picture is slightly different. Like its companion, the Beveridge scheme for social security, it was implemented by the Labour Party but had the support of other parties, who generally recognised that some form of welfare was badly needed. So the NHS did not spring from nothing, as with the big bang theory of the Universe.

There had been health provision for the working class before the war that was free of charge, but it had been very haphazard, with some areas over supplied and others very badly neglected. Also it relied upon charity. It was not there by right and most people saw a big difference. Bevan promoted a scheme that would abolish the stigma and unpredictability of charity and was comprehensive and open to all. And he had to fight for it, even against opposition within his own party, and from the British Medical Association, who saw a threat to their own power within a government run scheme. But once the scheme had been publicised there was no going back.

Yet those were minor obstacles compared to a force that neither Bevan nor the Labour Party has ever properly understood, the forces of capitalist economics.

Money problems

The NHS had to be paid for, and the money had to come from the capitalist class. Ever since its inception the history of the NHS has been a story of trying to provide adequate funding. Every government has looked for ways to find the money and cut the costs, and every government has failed. The original set-up has been modified, tinkered with or altered repeatedly, all, we are told in the interests of efficiency. And every government produces a fresh plan with a fanfare of trumpets that promises to solve all problems. Bevan initiated a reform that would prove to be one of the biggest headaches of all time for his own party or for any party trying to run capitalism, including Margaret Thatcher, who thought she had the magic formula to solve all problems, privatisation, but ended up by spending as much as anyone.

In truth there are many factors within capitalism which augur badly for the NHS. Although the trend for well-established capitalist countries is to gravitate from a production economy to a service economy, this can have problems. Manufactured goods, once they are into full mass production generally go down in price, notwithstanding inflation because they embody less labour.

But not all wealth can be mass-produced. Many jobs that require intensive labour-power cannot be made more productive by technology. But wages paid have to come into line with those of production workers where fewer workers still produce as much or more. This is why it is so expensive to have such things as electrical or building work done. Nursing comes into this category: you can't replace a nurse by a machine (although they do their best). So, if there are going to be enough nurses to run a health service the total cost of nursing care has to go up. In addition to which, nurses have to be trained to manage the increasing technical demands of modern health care.

The government try to overcome this problem by the well-used tactic of recruiting from countries with lower wages, such as the West Indies, South Africa and Poland. Another tried and tested solution favoured by employers is that of up-grading, i.e. allowing some tasks to be undertaken by those not previously regarded as having the necessary skills; for example, encouraging nurses to undertake minor surgery, thus relieving some pressure on doctors.

But this is minor, compared to the increasing costs of drug treatment, which have risen to astronomical proportions since the NHS was founded. When Bevan dreamed up his panacea for the working class of Britain, which was going to be the envy of the world, the practice of medicine was not as advanced as it is today. Drug treatment, as we know it today, apart from the heavy reliance on aspirin and the wartime use of penicillin, was unknown. Modern medical science was more or less born during the Second World War and it has made giant strides since, especially with regard to costs. Developing a modern medical drug can cost millions of pounds. And, as every reader of any newspaper must have noticed, new, 'wonder drugs' are launched with astonishing frequency, generally leading newspaper articles somewhere asking indignantly, "Why cannot this life saving drug be made available to anyone who needs it?" The pressures on the NHS are relentless, all of them making for increasing costs.

Population trends are swelling the numbers of old in relation to the young, and as we all know older people tend to have more illnesses, and their illnesses are more likely to take the form of expensive operations such as hip replacements. All these items are creating big problems for the NHS. and resulting in intensive press coverage, most of it highly critical, especially when it comes to waiting lists. It must be pointed out that this does not just apply to the NHS. Other capitalist institutions, paid for out of taxation levied upon the wealthy, are being cut, notably the armed forces, the police force and the fire service. And private (more or less) firms, which cannot apply technology to reduce costs (read, manpower), like the post office, are cutting the numbers of branches. So, what does the future hold for the NHS and its equivalents in other capitalist countries?

Decline

As the longest running institution of its kind the NHS is probably the creakiest in Europe, but there is nothing special about British capitalism that makes it more likely than any other to undergo decline. Most European countries are already showing signs of strain in funding their welfare systems and what applies to the UK must inevitably follow with them.

The conclusion must be that to fulfil the professed aims of Bevan for a health service that would cover the needs of the working class was never more than a pipe dream. No government will dare to upset their masters to the extent necessary to maintain a decent health service. The most likely prognosis is that it will carry on much as now with an increasing bias towards private hospitals and treatment that is paid for at the point of consumption. In fact it never lived up to its hype from the beginning; within months charges were being introduced for dental and optical services. There is no such thing as an adequate health service within a capitalist system of society and there never can be. It seems the current trend is to go back to something similar to pre NHS. and have a two tier system where what you get will be what you pay for. The rise in private hospitals and health insurance is a potent symbol of this trend.

No doubt most workers will conclude that any deficiencies in the NHS can be put right by a change of government and that it lies within the power of the political process to achieve a viable health system. This is a fallacy. The money system we live under is inherently biased towards satisfying the demands of a minority ruling class who are only concerned with having a working class fit enough to go to work and fight their wars for them. Capitalism can never be run in the interests of the majority and in any case will always throw up new problems of ill health as it progresses. The rickets and tuberculosis of the Victorians are being replaced by more sophisticated illnesses such as heart failure, stress and obesity of a more modern age, not to mention AIDS.

In a socialist society where the capacity for wealth production, unhampered by the colossal waste endemic to this one, can be released to the full, human values will predominate and energy can be concentrated on the causes of disease and its prevention. Issues such as the need for pharmaceuticals to make billions of pounds in profit will not exist. The NHS has managed to carry on so far as a more or less viable service largely due to the dedication and hard work of its members but this cannot last forever.

Cyril Evans

What Socialism Means (2005)

From the April 2005 issue of the Socialist Standard

Although the word socialism is itself more or less modern, its meaning can be said to go back to early religious sects of the ancient world and was taken up by religious dissidents in mediaeval times. Words attributed to John Ball during the Peasants' Revolt of 1381 capture its meaning very well: "My friends, things cannot go well in England, nor ever, until everything shall be held in common, when there shall be neither vassal nor lord and all distinctions levelled, when lords shall be no more masters than ourselves."

But it was not until the 19th Century that the concept of socialism (or communism) was developed by utopian socialists and then more systematically by Marx and Engels. Since the early 19th Century socialism has meant an alternative, classless society which can be set out under three main headings as follows:-

1. Common Ownership

2. Democratic Control.

3. Production solely for use.

These features of socialist society would be dependent on each other and could only operate together as basic parts of an integrated social system. In combination, these define a way of organising society that in every important aspect of production, distribution, decision making and social administration, is clearly distinguished from the operation of capitalist society.

1. Common ownership means that the entire structure of production and all natural resources be held in common by all people. This means that every person will stand in equal relationship with every other person with respect to the means of producing the things we need to live, that is, mines, industrial plants, manufacturing units, all land and farms, and all means of transport and distribution. This also means the common ownership of all natural resources. Perhaps "common ownership" is partly a misnomer because what is meant is that means of production and resources would not be owned by anyone. In place of the property relationships of owners and non-owners, means of production will simply be available to the whole community to be used and developed solely for the needs of all people.

2. Democratic control means that social policy would be decided by communities. In place of rule by governments, public decisions would be made by people themselves. One great advantage of democratic practice in socialism would be not only the organisation of decision making but also the freedom to carry out those decisions. This freedom of action would arise from direct control of community affairs following the enactment of common ownership and removal of the economic constraints of the capitalist system. Without powers of action decision-making is meaningless.

3. Production solely for use means just what it says. People in socialism would be free to co-operate voluntarily with each other in producing goods directly for the needs of the community. This would be useful labour co-operating to produce useful goods solely for consumption. Production solely for use would replace production for sale at a profit. Things produced for sale under the capitalist system are of course intended to supply a need of one kind or another but as commodities they are produced primarily with a view to money gain and the increase of money capital. As a general rule the market system is a system of 'no profit no production'. In socialism this profit motive would be entirely removed. In a moneyless socialist society the factors of production would operate only in a useful form and not as economic categories with a price. Labour would not be wage labour serving the interests of an employer but would be free labour. People at work would be creating only useful things and not economic values from which profit is derived.

There should be no doubt that these basic features that define socialism clearly distinguished it from the capitalist system. Common ownership of means of production would be in direct opposition to private, corporate or state ownership; democratic control would be fundamentally different from rule by governments; production for needs would be in direct opposition to production for sale at a profit. These contrasting features of the two systems cannot be operated together; they are mutually exclusive. The mistaken idea that they can be operated together has been a major cause of political confusion about what socialism means.

Production solely for needs
What is meant by needs should not be understood as mere personal consumption. It should not suggest a rampant consumerist culture. Production for needs would include a wide range of considerations such as the need to protect and conserve the environment. In defining socialism we should emphasise that it will provide for one vital need in a way that is impossible under the capitalist system. This is the need of peoples throughout the world to bring the organisation of their community affairs under their own democratic control and to develop them in the interests of the whole community.

It was with the emergence of the capitalist system that society lost its direct control of its productive resources. In previous societies, accepting that they were ruled by privileged classes in their own interests, it was often the case that production was at near maximum capacity given the technology and resources available and this determined what could be distributed. In times of good harvests the whole community could benefit in some shape or form. But with the development of the capitalist system this was eroded as what is produced depends crucially on what can be sold. This means that distribution through sale in the markets determines production and this is always less than what could be produced.

Market capacity is inherently unpredictable. If too many goods are produced for a market and they remain unsold, a crisis and recession may occur with reduced production, increased unemployment, bankruptcies, and large scale writing-off of capital values. Despite the many attempts that have been made, no theory of economic management has ever been able to predict or control the anarchic conditions of the market system. This is rule by market forces which serve minority interests and which generate the insecurities, crises and conflicts that shape the way we live. The fact that we have great powers of production that cannot be organised and fully used for the benefit of all people has devastating consequences and is at the root of most social problems.

In this way, the capitalist system places the production of goods and services, on which the quality of all our lives depends, outside the direct control of society. Contrary to this, a socialist system would bring the entire organisation of production and distribution under democratic social control.

Social class
A further basic distinction between the two systems is that whereas the capitalist system is inherently class ridden, in socialism, social relationships of common ownership and equality will end class divisions. Much discussion of class centres on various sociological differences between groups which may be useful for some purposes. However, sociological differences can tell us little when seeking to explain how production is organised.

Some evidence may suggest, superficially, that we live in a society of greater equality. For example, we can accept that not so long ago "toffs" were people who played golf and went on motoring holidays, touring the Continent. Now, many people from all walks of life do these things. This shows that these pursuits have become relatively cheaper and that some working people are now able to enjoy them, but this in no way alters the economic relationships of production. It does not alter the economic, class relationship between capital and labour which dominates the way we live. At the point of production, the workers and their employers who may be sharing a golf course in their leisure time remain in a relationship of conflicting economic interests which, whilst it continues, must always condemn our society to the class divisions of strife and to the many ugly comparisons that we see of poverty amidst luxury. Class is a social relationship that invades and has a corrupting influence on every part of our lives.

An economic definition of class based on the categories of capital and labour in a system of commodity production is basic to our explanation of how we produce and distribute wealth and the economic motives that are involved. Social class defined as economic relationships is a key to how the operation of the market puts profit before needs and places constraints on all our activities. Our lives and the quality of our society depend upon our relationships of production and on the services we can provide. An analysis using economic/class categories tells us who gets what from the pool of wealth that is made available and how a privileged class has accumulated great wealth and property; it therefore explains the great social differences that we see about us.

In addition, we find that increasingly, giant global corporations own and control the world production of goods and services together with the natural resources of the planet. The sole object is to amass greater concentrations of capital and to increase their economic and political powers.

We live in a society of deep class divisions with a conflict of economic interests between those who work the productive system and those who own it. This economic conflict can only be reconciled by the relationships of equality and cooperation that would integrate the community in socialism.
Whilst it is right to feel outrage at the great class divisions that exist socialists do not come to this question in a negative spirit of class hostility. The aim is to end it. Class conflict has gone on for too long; there has been too much strife and we have to heal the wounds of history through entirely democratic means.

Class society is both morally and materially indefensible. It need not linger on and on as part of an outdated system. An ethical society would be one in which all people would live their lives, free from the disadvantages of under privilege and class injustice. To live in a classless society would be in the interests of all its members. Freedom for every person to develop their skills and talents on equal terms could benefit everyone. Equality has the potential to enrich all our lives and would be a basis for a true community of shared interests.

Socialism a human-centred way of life
Having set out what socialism means, and having set out features that distinguish it clearly from capitalism, these can be summarised as one all important difference. Whereas the capitalist system works for sectional economic ends that are alien to the interests of the whole community, a socialist system would be wholly dedicated to the interests of all people. There would also be a difference of complexity and simplicity. Whereas, working within the complex economic limitations of the market system, our endeavours are frustrated and often blocked by the barriers of costs, in a socialist society, communities would be free to set up their goals and then organise their resources of labour, materials and technology to achieve them in a straightforward way. People in socialism would need only to work with the material factors of production and not any economic factors.

Given the control of human affairs that a socialist system would bring, people in socialism would be able to take charge of their destiny. What is undeniable is that we are a species with great talents. In science, technology, in art, crafts and design we can call upon a wide range of great skills. The point now is to release these for the benefit of humanity.

Pieter Lawrence