Stop this business! (1953)

From the November 1953 issue of the Socialist Standard

A visitor from another world, or a really long-term Rip Van Winkle, knowing little of the complexities of Capitalism, might imagine that the problem of satisfying the needs of mankind is now as good as solved. Modern methods of production would appear to have made possible, if not a superabundance, then at least enough of the material things that most people would accept as a reasonable standard of living.

But, of course, our visitor would be mistaken. It is not enough to produce or to be able to produce toothbrushes and shoes and houses to ensure that those who need such things do get them. No, a socially useless, dehumanising, wasteful, cruel, unpredictable, man-made institution called a (world) market effectively stands in the way. Despite the fact that people are in need, for instance of shoes, if the supply is greater than the demand to buy, then some shoes will be sentenced to economic death—they might as well not have been produced at all.

In recent years the tendency has been towards a “buyers’ market,” as it always is after the devastation wrought by a major war has been patched up. The export drives are in full swing. In fact rival nations are taking so many swings at each other over who is to capture which markets that the result is a melée of no mean proportions.

One of the tricks used to cajole overseas buyers into placing their orders with British capitalists is the employment of hospitality. There is really no other word to use than “employment,” though it does sound strange when used in connection with something a£ apparently unbusinesslike as hospitality. This year the sellers of British goods are having to roll out their largest-ever red-white-and-blue carpet to keep pace with the hospitality offered by foreign rivals. They must entertain and throw parties on a lavish scale in order to get round buyers. The Daily Mirror (20.6.53) describes the general atmosphere of these parties:

“It’s exactly like entertaining a rich aunt . . . But like rich aunts these affairs are so often trying. Even when you’re not talking business, both you and your guest know perfectly well that the only reason you're together is that you want to get at his money."

Operating on a less ambitious scale, the commercial traveller is to be found peddling his employer’s goods from door to door. He, too, must preserve a friendly attitude towards his potential customer—not that he wouldn’t like their relationship to be a sincerely friendly one, but the nature of the business virtually precludes that. He must never argue and must never admit to the slightest blemish in his firm's product— his job is, in fact that of a professional prevaricator.

Each separate business deal is like an armistice in a perpetual war. Buyer and seller come together to agree on certain terms. Then they part to continue the struggle to gain advantage in the next deal. The trait of aggressiveness is prominent in those who aspire to get to the top of the ladder. Yet aggressiveness is condemned in such common remarks as "Don't push other people around,'' and those who behave in this way are usually hated by their colleagues. The individual is thus divided against himself, as the society of which he is part is divided against itself.

"Don't be selfish” is another common injunction, yet its opposite is also advocated: keep your own advantage in mind, and in so doing you will also be acting for the greatest advantage of all others. The idea that egotism is the basis of general welfare is one of the basic principles of competitive society, whose antagonisms of interest reach up and down to every aspect of life.

The ability to “put across” one's personality in competition with many others is the key to success in the business world. Erich Fromm gives a good account of this in “Man For Himself ”:

"If it were enough for the purpose of making a living to rely on what one knows and can do, one’s self-esteem would be in proportion to one’s capacities . . . but since success depends largely on how one sells one's personality, one experiences oneself as a commodity or rather simultaneously as the setter and the commodity to be sold. A person is not concerned with his life and happiness, but with becoming saleable."

One of the outstanding features of private property society is the fact that activities which are means to ends have usurped the position of ends, while the ends themselves have been lost sight of. People work in order to make money in order to enjoy the fruits of their labour. Without the money there are no fruits— yet in getting the money there is little time left in which to taste the fruits, which seem to have turned sour anyway.

Examples of the business approach to social affairs are found in the ideas of all the advocates of Capitalism and, despite their superficial differences, they form a united front in opposing the ideas of Socialism. Thus the Free Enterprise Campaigners will criticize countries in which  a few men at the top decide how everyone shall live,” yet their own alternative is nothing more colourful than to give you a chance “if you want to change jobs or start up on your own.” On the other hand, the T.U.C. will tell you (in their recently published report on Public Ownership, p5) that to leave industries in private hands means that decisions whether to invest, and what charges to make to consumers, may not conform to the public interest.

Socialism, by contrast, has nothing to do with changing your employer, or with who works out the best way of keeping you financially just alive. It is concerned with abolishing capitalism and with organising production and distribution solely and directly to meet people's needs. One of the most harmful effects of Capitalism upon men is that they become instruments for purposes outside themselves. They treat themselves and their fellows as commodities, with the result that they think they are as powerless to change society as the article on the shop counter is powerless to sell itself. They are not—as they will demonstrate when enough of them think as socialists do.

Stan Parker

50 Years Ago: A call to bolster capitalism (1995)

The 50 Years Ago column from the November 1995 issue of the Socialist Standard

Before the election Sir Stafford Cripps stated, for the Labour Party, "the comfort of the people is the A.1 priority." Now he intends to set up a triple alliance — Trade Unions Employers and Government. — who will plan to bring "British competitive industries to the highest pitch of efficiency."—Daily Herald, September 10th, 1945. For "comfort”? No, the priority is the export trade. In his speech outlining the plan Cripps suggested that it will be difficult for people to realise that by going short now "they are in fact making sure of better and far more stable standards for the future.” What a stale feeble doctrine.' We will paraphrase it, "Put up with your poverty a little longer and shortly. —The Kingdom of Heaven." Really, Sir Stafford ought to be ashamed of himself. Isn’t he able to do better than this? Of course, this ruse has been used very successfully for decades. In 1931 the National Government used it and they obtained 14,000,000 votes. A slight variation in Germany was known as “guns before butter.' How amazing that a famous Labour leader should formulate "markets before butter,” or, what amounts to the same thing.

[From the front page article, 'A call to bolster capitalism: Cripps appeals to the workers ', Socialist Standard, November 1945.]

Finance and Industry: What of the future (1963)

The Finance and Industry Column from the November 1963 issue of the Socialist Standard

What of the Future

After a period in the doldrums the motor industry is booming again. To judge solely by the British press one would imagine the boom was confined to these shores. In fact, the U.K. industry is doing no better than most of its competitors and in some cases is not doing as well. Production, for example, is up by 15 per cent. in Britain so far this year compared with 1962; this is higher than the increase in Germany (14 per cent.). but less than in France (17 per cent.) and in Italy (28 per cent.). Even the recently stagnant U.S. industry has managed to show a rise of about 12 per cent.

The export comparison is even less flattering. U.K. exports in the first six months of this year are up 6 per cent. over 1962; but for France the rise is 18 per cent. and for Germany 21 per cent. Italy, on the other hand, has shown virtually no rise in exports at all and has had to contend in addition with a tremendous increase in imports.

All the big national producers in fact are turning out cars faster than they have ever done before. Total U.S. production is reckoned at over 8 millions for the whole of this year whilst Germany will probably produce about 2½ millions, Britain and France 14 millions each, and Italy near enough a million. The automobile is fast becoming as crucial to the Western European economies as it has long been to the American. “When Detroit sneezes,” it has been said, “America catches a cold “; the same can now be said of Dagenham, Wolfsburg, Billiancourt, Turin.

The urge towards more production and bigger sales has become hectic. Every firm in every country strives to keep ahead of its rivals; every national group tries to beat its competitors. New model follows new model with bewildering rapidity; there is new styling; engines go from the back to the front, and from the front to the back; gimmickry of one kind or another has free rein. To keep sales buoyant, it is essential to put something new before the buyers. Once a model like the old Ford 8 or Austin 7, or the Volkswagen, or long Citroen, went on for 15 or 20 years; now it is the exception if a model lasts a third of that time.

Having overwhelmed the small car sector with a vast range of differing models, the car manufacturers of the world are now switching their attention to the medium bracket. British Ford has currently no less than 17 different types in its Consul/Corsair complex in an attempt to cater for every idiosyncrasy on the part of buyers: other firms, such as Renault, Simca, and Volkswagen, are only just coming into the field with perhaps one or two models, but are geared up nevertheless to turn them off the assembly lines at 500 a day.

Apart from the rivalry between individual firms inside their own countries, competition has spilled over national boundaries. To get a foothold in the French market, British Ford and B.M.C. are selling cars at prices that must be bringing them little if any profit. Renault and Simca are doing the same in the U.K. Since the removal of certain tariff restrictions by Italy, the market there has been invaded by cars from Britain, France, and Germany (Volkswagen alone has taken up 5 per cent, of the market). Germany itself will import about 160,000 cars this year, 12 per cent. of new licences.

But in spite of all this frenzied activity, many firms are worried. Although they are turning out cars in large numbers, the profits are not coming so easily. Competition is intense, and the outlay on new plant, factory extensions, and more and more research, is a heavy burden. Most of the new production has been in small cars and the profit on these is low. The firms with the vast capital resources to cope with this mass production will have the best chance of survival, the others will either be taken over or will amalgamate.

The chief threat will come from American capital; from Ford with its holdings in Britain and Germany, General Motors again in Britain and Germany, and Chrysler in France. Volkswagen is already said to be feeling the pinch from Ford and Opel (General Motors), and Rootes has long suffered the same uncomfortable position in this country. Rumours continue to flourish in Europe about amalgamations of various “family”‘ concerns to counteract American pressure —Fiat in Italy, Mercedes—Auto Union in Germany, Citroen and Peugeot in France. That they all have reason to be afraid is emphasised by a recent calculation made in a European trade paper: General Motors in the U.S. would apparently still have made a profit of almost £300 million if they had given away free the whole of the production from their Opel plant in Germany.

It will be interesting to see for how long the independent European car producers can continue to stand up to the might of the American colossi. In the meantime, they carry on the frenzied struggle to sell their cars with one eye fixed anxiously on their European rivals and the other looking apprehensively at the United States. No wonder they cannot see where they are going—perhaps its just as well for them.

It’s all as planned

When trade booms the politicians dispute with the business men about the responsibility, both claiming the credit. When trade slumps the business men blame the government and the government blames the greedy workers or the wicked foreigners. The truth is that neither business men nor Cabinet Ministers can have much certain knowledge of the future ups and downs of home and foreign trade, or do much to control it: but some are luckier than others.

One widely held belief of our age is that governments can manipulate trade expansion and therefore can know what the future will bring because they control it. Sometimes they appear to be right not because they made it happen but because it was going to happen anyway and in spite of their efforts. An example of this was recently commented on by Paul Bareau in the Daily Mail on September 9th. He recalled that earlier in the year the Chancellor of the Exchequer undertook to promote an improvement in trade by running a budgetary deficit. Trade did improve between April and September but without the deficit having happened.

“The Chancellor of the Exchequer, therefore, budgeted for a current deficit of £90 million, a capital deficit of £597 million, and an overall deficit of £687 million—or ten times the modest and mean figure for 1962-63.

So far, virtually nothing of this worthy intention has been translated into fact. In the first five months of this financial year the current deficit was £28 million larger than in the corresponding period last year, but the capital deficit was £3 million smaller, leaving an almost negligible £25 million change in the overall deficit.

The recovery which has taken place in the economy, therefore, owes virtually nothing to the stimulus that was to be applied through the Budget.”

Business men may say that this just shows the limitations of politicians and their theories. But a recent book on the American Ford Company (The Fate of the Edsel, by John Brooks) recalls a colossal blunder of that company. They went to great expense to give the public just the car they wanted. It was a flop and lost £100 million.

Stan Hampson & Edgar Hardcastle

Double-think on disarmament (1965)

From the September 1965 issue of the Socialist Standard

Most of the people who have read George Orwell’s gloomy novel Nineteen Eighty Four have probably assumed that it was a warning of things to come. Perhaps that is what Orwell intended. Yet he must have been aware that much of what he wrote was not prophecy; it was happening at the time, and it is happening still.

One outstanding feature of Big Brother’s dictatorship was the way in which words were distorted until they came to mean their opposite. The Ministry of Truth propagated lies. The three principles of Ingsoc were: War Is Peace; Freedom Is Slavery; Ignorance Is Strength. This is so blatant that there was no need for Orwell to be at all elaborate in attacking it. Yet the same sort of distortion happens today and nobody considers it worth debunking in a best selling novel.

Consider the word disarmament. The meaning is clear enough. It is a word in constant use by all sorts of governments to describe a distant ideal which, they say, they are aiming for and which they would attain if it were not for the obstacles being put in their way by other governments. Political leaders often announce, with the air of men revealing a fundamental secret, that was is needed is a disarmament conference, but nobody else is interested in attending one. Sometimes the nations actually get around the conference table and the reporters tell us they are talking about disarmament.

All of this convinces the sort of people who would be deceived by Big Brother that there is a chance of the rival states of capitalism discarding their armaments. But despite all the talk and the promises, and despite the frequent use of the word, no country ever gets to the point of actually disarming. Indeed, the very governments who claim to have an interest in the matter go for the most powerful weapons in the world, which is more or less the same as saying that War is Peace.

A recent example of this has been provided by the Labour Government who, as we all know, have not got a department actually called the Ministry of Truth. The programme on which the Labour Party fought the last election said:

“First and foremost will come our initiative in the field of disarmament. We are convinced that the time is opportune for a new break-through in the disarmament negotiations . . .

We shall appoint a Minister in the Foreign Office with special responsibility for disarmament . . .”

Now it is Mr. Wilson’s proud boast that his Government are keeping the promises they made last October and sure enough he did appoint a Minister of Disarmament. This man was one of Mr. Wilson’s little surprises—a journalist who, given a Life peerage, was tucked away into his corner at Whitehall and left, in the words of Labour’s manifesto, “. . . To stop the spread of nuclear weapons . . . achieve controlled reductions in manpower and arms . . . stop the private sale of arms . . .”—which nobody can say is an unambitious programme.

This, then, was Labour’s way of taking the initiative on disarmament. Unfortunately, it soon became clear that matters were not so simple. The new Government announced that, even after making several reductions, they were still going to spend more on armaments than ever before in peace time. A few months later they showed how anxious they were that other countries should follow this example; they appointed a “super salesman” to sell British-made arms abroad—and salesmen, of course, thrive on their customers’ increased expenditure.

In this, the Labour Government acted with the same speed as in the appointment of Lord Chalfont. It soon became known that the job had been accepted by Sir Donald Stokes, the managing director of Leyland’s, a firm already well entrenched in the weapons trade. There was no doubt that the Government were as solidly behind Sir Donald, in his efforts to persuade countries not to disarm, as they were supposed to be behind Lord Chalfont in his efforts to do the opposite. The super salesman was pleased to tell us:

“They are giving me a big staff, all the staff I need, and I have been promised assistance and co-operation from Government level downwards.”

Sir Donald did not speculate on what would happen if everywhere his staff went they were turned away by governments who had been under the misapprehension that the Labour Government wanted them to disarm. (There was, of course, no need for him to speculate on the opposite; everyone knows what happens when the weapons salesmen are busily successful.) Neither did he mention that Mr. Wilson, who often attacks trade union rules which keep two men doing a job which could be done by one, has gone one better than the unions by creating two jobs which in theory cancel each other out.

In fact, the Government’s mind is anything but confused. Disarmament is so remote a possibility that it can be ignored, or at best treated derisively. But for political reasons some sort of a gesture must be made. There is nothing original in Labour’s actions, other than the fact that they have appointed a Minister. And what is that worth? Lord Chalfont may not actually get to the bonfire, but he is no more than a dummy, a November guy dressed up to attract the voters’ pennies. The real world of capitalism, with its rival economies and its disputes, is more correctly represented by Sir Donald Stokes.

Weapons, just like all other wealth produced under capitalism, are commodities. The need or fancy which, in their own unique way, they satisfy, spring from the wars which capitalism inevitably produces. The companies which make armaments hope to make profits from them. Sometimes they fail; sometimes—like Ferranti’s and the Bloodhound—they succeed.

The arms market, like those for other commodities, is often affected by government policies. The Western Powers have a strict embargo on exports to China; the Labour Government have prevented sales to South Africa. The armaments companies naturally do not like this interference and sometimes, as a recent biography of Bazil Zaharoff made clear, they manage to sell their wares to enemy countries in defiance of their governments’ wishes.

In other cases, governments actively help their armaments firms to produce and to sell their goods. Up to now British firms have been left largely to their own resources in the export markets. They had to wait for the export-driving Labour Government to give them the extra push to go out and prove to the world that British weapons knock down, blow up, sink, bomb or simply kill, better than any others. The reason for this support is that the Government feel the British industry is being deprived of its slice of a very rich cake.

The entire arms export market between now and 1967 may be worth £1,500 million, a lot of it in Europe. The American industry is already bidding strongly, with their own super-salesman and a big and energetic staff. One of their current projects is to persuade NATO to take American weapons as their standard equipment, which would be a bitter blow to the British weapon makers. This high pressure selling has provoked Mr. Wilson to complain, and to organise his own bunch of salesmen to operate at a similarly high pressure under Sir Donald Stokes. This is probably very welcome to the armaments firms over here—as Robert Heller commented in The Observer: “. . . it’s not often you get the free services of somebody else’s super-salesman.” But it can be reconciled with Labour’s professed interest in disarmament only by the same mental processes as justify the Big Brother slogan of Freedom Is Slavery.

The Government may well argue that they are not the only hypocrites. Every state pays lip service to disarmament, even while they are arming to the teeth. The French Government celebrated this year’s Bastille Day with a display of nuclear weapons and other military delicacies which have absolutely no connection with Liberty, Equality or Fraternity. The Soviet Government recently took the initiative in recalling the Geneva Disarmament Conference, but before anyone starts to cheer this as an example of the Kremlin’s interest in disarmament they should remember that the Russians share the responsibility for the same conference breaking down last September. It is apparent that other motives lie behind the reopening of the talks.

Nuclear weapons are not simple. Contrary to popular belief, they cannot be made and fired by a solitary madman out of a science fiction paper-back. They are the products of a developed industry, backed by considerable technical knowledge. At one time, only the most advanced countries could hope to have nuclear weapons, but now the situation has changed. At the moment five countries have the Bomb and, according to Lord Chalfont, there are about a dozen others with the knowledge to make it; within the next 15 years the number of nuclear powers may more than double.

This is one of the current problems of the big power blocs; they call it the “proliferation” (Orwell would have been proud of that word) of nuclear weapons. Neither the United States nor the Soviet Union wants to see the present military power balance disturbed by the rise of other nuclear powers. China is only one of those which could become a dominant menace by the development, and perhaps the use, of a fashionably powerful nuclear weapon. The West German Government, while protesting its own intention not to make the Bomb, it trying to use this act of self-denial to add weight to its campaign for the reunification of Germany. How far is Bonn prepared to go in this explosive dispute? The Russian and American ruling classes clearly have a common interest in trying to control these threats; if the Bomb has to be used, they want to see that is is with their consent.

What the Geneva Conference is actually doing in talking about a treaty to prevent non-nuclear powers becoming nuclear, is trying to control and reverse a process which the nuclear powers themselves began when they first made their Bomb. Russia and Britain did not regard “proliferation” as a problem as long as they were among the non-nuclear powers; they were working hard to spread atomic weapons in their direction. But as soon as they mastered the Bomb they became interested in restricting the number of nuclear powers. Their claim to be interested in disarmament is worth no more than the title of Ministry of Peace, given by Orwell to the department which waged perpetual warfare.

If disarmament conferences are complicated affairs this is but a symptom of the tangled interests and the involved disputes which are capitalism. The conference cannot succeed because capitalism is always at war. One of the latest to testify to this is Lord Watkinson, who used to be a Conservative Minister and who is now the chairman of the British National Council’s committee for exports to the United States. This is what he said on July 13th last:

“The situation facing Britain at present can he summed up as “export or bust” . . . The Government must he convinced that, whereas war is a possible occurrence, the trading battle goes on the whole time.”

It is impossible to imagine the sort of world which Lord Watkinson described laying down its arms. The perpetual trading battles of capitalism breed its wars, and so make armaments necessary. The capitalist powers talk about disarmament but this is only another example of words being distorted to accommodate a blatant hypocrisy. The fact of the matter is that while the politicians talk and make their promises the arms pile up and become more powerful. 

It is not yet 1984, but the people who support this system—the people who make the weapons and who use them and who make all the other wealth of capitalism—are as deluded as Orwell’s party members. It is not an overstatement to say that capitalism survives by virtue of the working classes conviction that War is Peace, that their Slavery is really Freedom, and that the whole murderous Ignorance of it all is Strength.

Ivan

Notes by the Way: The Contradictions of Nationalism (1955)

The Notes by the Way Column from the October 1955 issue of the Socialist Standard

The Contradictions of Nationalism

While Capitalism lasts so will its class and international economic struggles, many of them taking on a racial, religious or nationalist appearance whenever this suits the needs of some interested group. Socialists do not support these manifestations of prejudice. But the supporters of Nationalist Movements make use of two plausible arguments. One is that it is a good thing to have a National Capitalist Group in power in preference to Capitalist rule by foreigners because the former are more progressive, and the other is that by winning national independence you get rid of preoccupation with Nationalism and thus make it easier to get down to Socialism.

There is nothing in either argument. In comparatively recent times Egypt, India, Burma, the Middle East Arab States, Hungary, Poland and South Africa, have emerged from greater or less degree of foreign rule and their absence of progress in any sense that matters, is matched by their extreme preoccupation with nonsensical Nationalism.

It has been noticed by many newspaper correspondents in India that there has been in recent years, not a decline, but a growth of Nationalism and now Indians are complaining of growing intolerance towards themselves shown in the countries of South East Asia. Mr. S. K. Patil, one of the chiefs of the Indian Congress Party, has returned from a tour of Burma, Siam, Malaya, and Singapore, “where, he said, dangerous and poisonous Nationalism, if allowed to develop, would result in intolerance for Indians and other foreigners.”—(Times, 17/9/55.)

Nationalism inevitably has its ridiculous side because in the world as it is today the dreams and pretensions of the Nationalists (all of them, including the British, Russian and American) so frequently will not fit into the facts of Capitalism.

The Irish Nationalists may dream as much as they like about ancient myths and glories but the Irish Government is now inviting German Capitalism to come into Ireland to develop the textile industry (Financial Times 13/9/55) so that it can sell more in the British market; though at the same time it is “banning the import of cheap shirts from the Far East in order to protect the jobs of Irish textile workers" (Daily Express 20/9/55.) Doubtless some of the Irish Nationalists would like to live in a really Irish Ireland but in the real world they can’t get the Irish to speak their own language and they need foreign markets and foreign capital, and by a curious arrangement the British Post Office publication “Post Offices in the United Kingdom” contains not only the Post Offices in Britain, but also those in the Irish Republic. With so many Irish workers working in this country the Irish Government doubtless finds it convenient to have easy means provided for Irish emigrants in Britain to send correspondence and remittances to their relatives.

#    #    #    #

The Trade Battle across the Iron Curtain

A year or two ago there were two propaganda drives going on, one to expand British exports to U.S.A. and Canada and the other to popularise the idea that Russia could offer an attractive market for British exports.

The first has received a jolt lately since some big contracts in U.S.A. have been awarded, not to the lowest tender, coming from British firms, but to American firms quoting higher. And, according to the Daily Express (1/9/55) British exports to Canada are not looking too good;

Trade men in America say that Western Germany is making an all out drive to rob Britain of her place as the world’s second largest exporter of engineering goods—next to the U.S.

Main “ battleground" is likely to be in Canada—where already British sales of engineering goods are losing ground to the Germans.

And it appears that Russian competition is a factor in certain lines. The Daily Express of the same date reported the following:—

Dumping of matches in Britain by Russia and other Iron Curtain countries has forced the giant Bryant and May match combine to close one of its plants.

The “Brymay” boss, Sir Anthony Elkins, says this morning that the Red competition is “severe."

That is a masterly under-statement. For imports of Russian matches have leaped from 72,000 gross boxes in 1953 to a current rate of 774,000 gross boxes.

For the statistically minded that is 111,456,000 boxes of matches a year.

#    #    #    #

Religion and Morals

A favourite side argument of religionists has always been that if there were no religion moral standards would decline. While they readily admit, and indeed make a point of asserting, that the real basis of religion is “faith” not behaviour they nevertheless find it convenient to buttress the case for religion by maintaining that the two are linked and that one falls with the other.

Now some American churchmen have had to allow that events in U.S.A. do not support the argument. They say that while religion is booming “ morality seems to be on the decline.”

The following appeared in the Observer (London, September 18, 1955):—

A record increase in Church membership in the United States is reported in figures to be released this week by the National Council of Churches of the United States. It shows a total of more than 97 million, an increase of over 2,500,000 during 1954.

There are 57 million Protestants, 32 million Roman Catholics, 5,500,000 Jews and two million Eastern Orthodox Church members. Among Protestant Churches the Baptists, with 18,500,000, have the greatest number of adherents. The Methodists are second with nearly 12 million.

Whether the present “religious boom" in the United States is deeply seated in religious conviction is doubted by Dr. Eugene Carson Blake, this year's president of the National Council of Churches. In a comment on the figures Dr. Blake says: “ Morality seems to be on the decline at the moment when there appears to be a religious boom. Preachers in this industrial age are finding modern man's anxiety for his job is just as acute as primitive man’s for a good harvest"

#    #    #    #

Dividends and Wages; and those who get them

As a propaganda move against wage claims, Sir John Braithwaite, Chairman of the Stock Exchange, recently issued a statement on the relative increase of dividends and wages since 1947. His statement, published in the Manchester Guardian (29 August, 1955) contained the following:—

The total of wages and salaries for the year ending December 31, 1954, was £9,265 millions, as against a total of £1,122 millions for interest and dividends on securities quoted on the Stock Exchange, or over eight times as great.

Wages and salaries have advanced since 1947 by 69.2 per cent. (£3,790 millions) against an increase of 32.1 per cent. (£273 millions) in interest and dividends (of winch ordinary dividends constitute 39.6 per cent). That is to say that the rise in wages and salaries is more than double the rise in interest and dividends by percentage, and nearly 14 times as much by volume.

Socialists of course are not believers in the Labour Party notion that Capitalism would be all right provided the Capitalists received rather less and the workers rather more. And one or two of the more objective defenders of Capitalism have pointed out that on the basis of the Tory argument for the free play of economic forces there is no sanctity about the division that existed in 1947 or any other year—each side gets what it can when it can.

There is, however, a useful corrective to apply to the figures. It is simply this: While “wages and salaries” cover something over 20 million workers, not to mention their still larger number of dependents, the number of shareholders is relatively a very small body. Mr. Harold Wincott, writing in the Unilever Journal “Progress” (Spring 1955, page 161) had this to say:—

“In this country, it has been estimated that out of a population of 50,000,000, only some 1,250,000 to 1,500,000 people are shareholders. Even in the more capitalistic United States, a recent inquiry by the Brookings Institution produced an estimate that shareholders numbered only some 6,500,000 out of a population of 160,000,000.

Of course, included in these apparently exclusive bands of investors are a relative handful of institutions—insurance companies, pension funds, investment trusts, and so on—investing vast sums of money on behalf of a great multitude of indirect investors. But the policy holder and the contributor to a pension fund do not generally speaking regard themselves as being identified with the course of stock market prices. Theirs is a very remote and indirect link. With only three persons in every 100 in this country and four in each 100 in the United States holding shares in their own right, it is not surprising if the events in the world’s stock exchanges are normally things apart from the man in the street."

#    #    #    #

Muddle about Socialism

The Manchester Guardian (17/9/55) had a leading article deploring the confusion and ill-feeling that arise because not many of us “recognise the kind of society in which we are living.”

“American Conservatives are angry if told that their economy, far from being based on the free play of market forces, is almost as Socialist as the British system. The Russian Communists are infuriated if told that their Stakhonovite arrangements, with high wages for exceptional workers and coercion for the ordinary men, are less Socialist than much of the "British system."

The reader will have read enough of the article to see that the Manchester Guardian is doing nothing to remove the confusion. Its conclusion, a masterpiece of muddle, is that “in short our system is neither Capitalist nor Socialist, but a mixture.”

In another Journal (Tribune, 16 September, 1955), a Labour M.P., Mr. Ian Mikardo, adds his contribution. Writing under the heading “Don’t Tell Me this is Socialism,” he makes the discovery that the French system of having the nationalised gas industry and the nationalised electricity industry using jointly the same non-competitive showroom is Socialism, but the English system of having them in competition and using rival showrooms is not. 

Whoever it was that told Mr. Mikardo that either of them has anything whatever to do with Socialism, it cannot have been a Socialist And one wonders what Mr. Mikardo was telling his readers in the past when he supported the Electricity and Gas Nationalisation Acts.

According to his odd test a nationalised industry is “Socialism” if it has a monopoly. Well the Post Office has a monopoly in most of its services but Mr. Attlee long ago described it as “the outstanding example of collective Capitalism” (New Statesman, 7/11/31).

This is the first piece of light so far, and with its help we can put Mr. Mikardo, the Guardian the Americans and the Russians on the right road—that is if they want to be on the right road.

It all boils down to private Capitalism and State Capitalism and indeed on this basis and this alone America, Britain, Russia and all other countries are a mixture— but without any Socialism.

#    #    #    #

When will the Boom End ?

The economist, Mr. Roy Harrod, set out to answer this question in the Financial Times (10 September, 55). He thinks that “recession” will come in the autumn of 1956 or somewhat earlier. His reasons are that the wave of expansion of factories and equipment that began about October, 1954, will be more or less completed in two years that it was excessive in amount; and that it may be found that it cannot be fully operated. He writes:—

“In 1956, we shall be faced with the problems of recession. This might merely take the form of a welcome decline of orders to engineering industry. But it might also be found—which would be more serious—that during this period of expansion we had created, in some lines at least, excessive capacity in relation to markets or to manpower available to operate it Matters would be still worse if some recession in our export markets began to manifest itself at about the same time."

It will be noticed that though he starts off very firmly about the demonstrable feet that the 1954 spate of new orders for factories, etc., will be running out in 1956, and less firmly anticipates a recession then, he becomes quite non committal about the other factors and indeed is not sure that he knows whether there will be factories without factory workers or factories with workers, but without markets.

He remembers no doubt the many other attempts by economists, including the advisers of the Labour Governments and the present Government, to forecast from one year to another what is going to happen.

The Editorial of the Financial Times, commenting on Mr. Harrod’s article, is rather more definite than he is. The Editorial says:—

“He makes what is no doubt a sound case for the view that the investment boom is the major cause of current balance of payment difficulties, and then goes on to suggest that this may lead in turn to an excess of supply in the autumn of next year. The risk is a real one, but not perhaps a very serious one. In the past it has proved the characteristic of long-term periods of rising prices, such as the 1850's and 1860’s, to have major booms and minor recessions. In fact, the United States has absorbed three minor recessions since the war, and we have already absorbed one."

One other point made by Mr. Harrod is of interest in yiew of the current argument by employers and politicians that economic difficulties are due to wage increases and “buying sprees.” Mr. Harrod maintains that the excessive expansion of factories (encouraged by the Government when they ought, according to him to have been discouraging it) is the predominant disturbing factor.

“Other factors making towards inflation—wage increases of 7½ per cent.; consumption increase of five per cent—are trivial by comparison."

Edgar Hardcastle

So They Say: Protests too much (1977)

The So They Say Column from the December 1977 issue of the Socialist Standard

Protests too much

An article in The Spectator of 12th November entitled “The irrelevance of class” which attempts to justify its title by showing how various important men have risen from what are discreetly referred to as “humble births”, reminds us that the class war still prompts professional hacks (and quacks) to issue it, at regular intervals with a formal death certificate. The entire irrelevance of class structure within society led the writer of the article to over 50 column-inches to make his point and if The Spectator is prepared to pay for and publish this sort of thing, we have high hopes for our own submission entitled “The irrelevance of air—hot and cold.”

The inconvenient obstacle to the claim however is one of fact. Obstacles of this nature may or may not impress Spectator’s writers who are prepared to spend a good deal of time apparently in dealing with what they consider “irrelevances”, but it cannot seriously be denied that capitalist society is divided, on the one hand into those who own and control the means of life and on the other, into those who must work for a member of the owning class in order to live. If this class division were non-existent, or irrelevant, we could only express surprise at the great deal of verbiage mustered to assure us of the claim.

Not cricket

Although the owning class as a whole have class interests in common, namely the retention of private- property society and they will unite on issues which may threaten this, each member also has individual interests in the day-to-day business of increasing their particular share of the social wealth, and this process obliges them to enter into battles among themselves. Whereas the working class, the non-owners, represent a class enemy to be held off by a variety of means, other members of the capitalist class are rivals and as such require direct attention.

Fresh diplomatic protests have been tendered by the Government over breaches in agreements by Japanese (Motor) manufacturers to hold down sales in Britain.

(Daily Telegraph, 10th November 77)

The British motor manufacturers claim that the Japanese are carrying out an “invasion” of the British markets contrary to an undertaking given by the Japanese to restrain sales to the UK. It all sounds very reasonable—an arrangement between friends. The Japanese motor men have argued before that it had all been a misunderstanding and they may well do so again. The fact that the British government now argues the case on behalf of its own national manufacturers shows that they are not deceived. Both parties are aware that “undertakings” are weak restraints on the pressures of capitalist expansion.

Making the point, in the same newspaper, was the Chairman of the Welsh council of the CBI who advises his members that British manufacturers can satisfactorily meet Japanese competition by putting in “the same intensity of effort as the Japanese”, by which he means a greater degree of exploitation of the British working class. This gentleman was speaking from experience. He is the chairman of a machine-tool company.

Last year I put one Japanese firm out of business and two other Japanese firms have given up their markets to me.

(Daily Telegraph, 10th November 77)

It seems probable that the aforementioned Japanese firms may be petitioning him soon to give an “undertaking” for restraint.

Plenty of problems

The Japanese Prime Minister has become increasingly concerned at the economic problems he faces as the yen rises against other currencies and the exporters are finding it more difficult to compete successfully in overseas markets. He now refers to exports as a “negligible factor in expanding economic growth in future.” The new strategy he revealed is to be the stimulation of home demand by increasing public spending, which we seem to have heard somewhere before.

Mr. Fukuda neatly put his finger on one of the major difficulties facing the Japanese, who are by no means alone in the matter, and shows that capitalism, despite the efforts of so-called planning, simply continues to produce problems and contradictions. The profit motive governs production.

The important thing is to create demand in the midst of the problems of overcapacity and unemployment.

(The Times, 11th November 77)

Capitalist ideologies

The Chinese are said to have approached the British government with a view to ordering Harrier jump-jets. Apparently the so-called socialists are faced with a build up of forces on their border with the other so-called socialists, the Russians. The fact that the British government also refers to itself as “socialist” no doubt lends justification to the approach and completes the picture of this happy socialist band who act so differently from the capitalist governments. To an un-trained eye it would appear to be a straightforward business arrangement.

However Britain is a member of a NATO organization called Cocom whose function is to prevent the sale of weapons and plant for producing them, to “communist” countries. America is also a member and it might be thought that they would, as they are entitled, veto consideration of the order. Surely the Americans would not permit any hole-in-the-wall arrangement between all these “socialists". It appears however that the Americans have an un-trained eye in the matter. They have their reasons too.

The fact that there is a company to company agreement between Hawker Siddeley and Macdonald Douglas to manufacture the Harrier under licence in no way interferes with the sale of the Harrier by Britain to other states, I was authoritatively informed yesterday. A non-British member of Cocom’s coordinating committee told me a few days ago that the United States rarely raised any objection to the export of strategic materials to a Communist country if it was produced or manufactured in America.

(Daily Telegraph, 9th November 77)

Voice From The Back: Free (?) Trade (2000)

The Voice From The Back Column from the January 2000 issue of the Socialist Standard

Free (?) Trade 

The embattled head of the World Trade Organisation, Mike Moore, is pledging to use next week’s global trade talks in Seattle to open up the rich markets of the west to poor countries in an attempt to defuse the biggest demonstration in America since the Vietnam war. With the FBI fearful that the arrival of up to 150,000 protesters against the start of a new round of trade liberalisation talks may result in widespread disruption and violence, Mr Moore said in an interview with the Guardian that he was seeking to put right the “great injustices” of the world’s trading system . . . However, attempts by trade diplomats to produce an agreed text in advance have foundered and the WTO has come under attack from non-governmental organisations for being undemocratic, indifferent to the environment and dominated by multinational companies. Guardian, 25 November.

The death trade 

Britain last year continued to sell weapons to countries with poor human rights records despite the government’s pledge to bring an “ethical dimension” to foreign policy, the annual report on arms sales published yesterday shows. The government approved export licences for a wide range of military equipment to Indonesia, Turkey, China, Bahrain, and Algeria, as well as Saudi Arabia, Britain’s main arms customer. The report shows nearly £2bn worth of weapons were exported by Britain last year, including 38 armoured combat vehicles to Indonesia, 18 Tornado aircraft, 100 air-to-ground missiles to Saudi Arabia, and over 400 air-launched missiles to the United Arab Emirates. Guardian, 4 November.

Saving lives or profits 

The Boeing Corp. failed to disclose key findings from a 1980 report about fuel-tank problems in its jumbo jets that could have assisted federal safety investigators probing the crash off Long Island in 1996 . . . Sen. Charles Grassley (R-Iowa), chairman of the subcommittee that oversees airline-disaster probes, told the Post that Flight 800’s crash could have been prevented had Boeing disclosed the report earlier. In 1990, a fuel-tank explosion on a different model jet, a Philippines Airline 737, killed eight people. New York Post, 29 October.

Couldn’t care less 

Old people are dying after operations because of hospital staff shortages and poor training, according to an independent investigation. Delays and dangerous negligence lay at the heart of a “poor” standard of care for the elderly after surgery, the enquiry concluded. Times, 18 November.

Define “professional”, please 

Headhunters are “unprofessional, unethical, money-mad, short-term chancers who would shaft anyone for a quick buck”. It’s official. A headhunter says so. The recruitment industry has been shaken by an e-mail sent by one of its oldest members to staff at a number of rivals in an attempt to poach them. Yes, really. Is there no honour among thieves? Claiming to be “the truth about recruitment agencies”, the message included the above description and suggested that, since they are treated so badly, staff owe their employers no loyalty and might as well switch sides. It came from a director of Lorien, a quoted company specialising in IT staff, and found its way to Computer Weekly.

Free market madness 

Free coal, the traditional perk for retired miners, may soon be shipped from China. The pensioners are being urged by the government to take the cheaper, subsidised Oriental fuel to cut the cost to the taxpayer. Financial Mail on Sunday, 28 November.

Not ethnic conflict—plunder 

The war in the Congo perpetuates a conflict that affects nearly every country in Africa; Congo, located in the centre of the continent, has borders with nine other countries . . . It is, in reality, one giant war against all of Africa, as a detailed analysis of any one of these wars readily shows. The real belligerents were not even at the peace talk in Lusaka: the British Commonwealth and allied French interests who, operating with complicity channels in the United States, are seeking to destroy the nation states of Africa in a domino chain of wars, and to ensure the full domination of Africa’s vast resources for themselves. The People Newspaper, Uganda, 4-18 August.

How helpful! 

“REMAIN WEALTHY. Money is fickle. And self-centred. It couldn’t care less about you and the people who depend on you. Protecting your wealth is up to you. For over 80 years we’ve helped manage the assets of some of America’s wealthiest families. Growing and protecting their money. Giving them the financial security to enjoy life to the fullest. Over the years our customers have come to expect the unprecedented level of attention and service we provide. We can do the same for you and your family. For more information, call or stop by our office at 520 Madison Avenue, 33rd floor. And find out how you can keep your money yours. WILMINGTON TRUST.” Stagebill, October.

Has British trade a future? (1926)

From the November 1926 issue of the Socialist Standard

A month or two back Chiozza Money wrote a series of articles for the “Daily Chronicle” on the “World Race for Trade.” On May 21st, he describes a visit paid to Sheffield where he inspected Cammell Laird’s works. He found that the efficiency of these works was equal to anything he had seen in America, and yet there is any amount of plant idle, in some instances the works were only working at half capacity.

In dealing with this question of idle plant, he makes the following observations :

It all comes to one word—Markets. There are the Dominions and India, but they are markets not reserved to us. Moreover, in 1926, the world is out of joint. We have to wait for better times. That those better times will come we may rest assured. The world must, sooner or later, need a much greater supply of iron and steel than it now calls for. The efficiency of Sheffield will not always go unrewarded. 

Now it is all very well to “rest assured,” but it is much better to know a little of the possibilities of the assurance being well-founded.

In a further article on June 7th, he says :

Foreign competition is increasing and will increase. The expanding markets for which we may legitimately hope will demand less of crudely manufactured and more of artistic productions. Intense and growing foreign competition will make it necessary for British exporters to increase their efforts, and for British manufacturers to adopt every good economic device.

He then goes on to urge that trade unions should welcome the adoption of the best-known machinery and improvements in methods of work. He tacks on to this the well-worn recommendation for a friendly co-operation in economic endeavour between employers and workers.

He makes three main points : (1) that a world-wide expansion in trade is coming shortly; (2) that if English manufacturers reduce their costs of production they will get a large share in it; (3) that an increase in trade makes it possible for the workers to claim a larger share of the product.

We will take a few quotations from different sources that have a general bearing on the questions raised.

As Chiozza Money has concerned himself very much with America, the following quotation from the “Christian Science Monitor” is very apt. We quote it at length, as the points raised are so interesting.

Absorption of surplus production presents one of the outstanding difficulties of the American manufacturer according to Alvin K. Dodd, of the Department of Domestic Distribution, Chamber of Commerce of the United States, speaking at the thirteenth annual convention of the Society of Industrial Engineers here [Philadelphia].

The former necessity of meeting the existing demand has been succeeded by the question of making a demand for the over-supply, he said. Growth in population, he continued, is only about 16 per cent. above that of 1913, and, if we accept 30 per cent. as the increase in facilities, for manufacture, a capacity exists seriously in excess of what might he called the normal demand on pre-war rate of production.

The result of this is seen, he declared, in exaggerated forms of competition, extraordinary displays in advertising, extraordinary costs, unusual growth in methods of distribution, and. finally, the latest expedient, instalment selling which is not appeased by anything less than the payment of next year’s income for this year’s product.

With the situation of America as stated above, unable to get rid of a large excess of production, and itching to find fresh outlets for her goods, the race for the satisfaction of the possible expanding market ingoing to be keen.

Let us take another quotation.

Walter T. Layton, Editor of the “Economist,” makes a contribution to the discussion in the “Manchester Guardian,” of April 20th last, from which we take the following extract :—

In these circumstances are we most likely to find the much-needed expansion of our foreign trade in the markets of Europe or of the Empire? It must be admitted that the prospect of attaining free trade within the Empire or of making it self-sufficient is not very promising. India, which is much the largest of the Imperial markets, is evidently determined to maintain some measure of protection against British manufactures. Canada, whatever may happen in the political field, is destined to come increasingly within the economic sphere of influence of the United States—a significant sign of which is the fact that Canadian enterprise is no longer financed mainly from London, but from New York. Even Australia is determined to foster her iron and steel, textile and other industries and to keep out British goods as fast as she can replace them at home. The ties of Empire are very real and lasting ones, but no one can look at the map of the world and truthfully say that the British Empire is a natural economic unit or that Great Britain. can find a complete outlet for her economic activities in the Empire.

According to the above, and the source should be authoritative, the Empire does not hold out much hope to the English manufacturer in the event of a general expansion of trade.

Let us go farther afield. Let us probe into the condition of the Eastern lands of mystery and hope, and see what prospects for the European manufacturer exist there.

Japan has learnt much from the West, and turned her knowledge to good account. The “Osaka Mainichi,” June 30th, 1926, has an article on Japan’s growth in prosperity from which we take the following information :—

In 1887, eighty-four per cent. of the foreign trade of Japan was handled by foreign merchants. Of the imports, eighty-five per cent. was handled by foreign firms. During 1894-5, the native firms commenced to increase in activity, and by 1900 they handled thirty-five per cent. of the exports and thirty-nine per cent, of the imports. The Russo-Japanese War of 1904-5 was a great impetus for an enormous expansion of the foreign trade of Japan, and the increasing influence of Japanese traders. But the Great War of 1914-18 was the real opportunity of the Japanese merchants.

Taking advantage of the world demand for silk and cotton piece goods, more than 10 Japanese firms went to the extent of establishing their branches in Wall Street and Madison Square, where almost prohibitively high rents were demanded, and conducted their business, paying high cable rates. The activities of the Japanese merchants then alarmed the Americans, who may be generally classified as amateurs in foreign trade.

The Japanese view of the American foreign traders is worth noting. “Amateurs” ! !

Of late years there has been an enormous development in trustification. The slowing down of European manufacture for foreign markets and for ordinary products in the home markets gave Japan her chance. There was an enormous expansion in Japanese manufacture and trade, and a wild scramble among the producers. Small firms grew rapidly and joined with large corporations.

The post-war panic and the following years of depression caught many of the Japanese corporations in the swirl. Some were driven into bankruptcy along with many private firms. Later, when things were on the mend again, the tremendous earthquake gave them a further set-back. Since the earthquake, things have steadily improved, and Japan is turning greedy eyes abroad for an outlet for her surplus population and surplus goods. At the present date the bulk of Japanese foreign trade is handled by native merchants. The trust companies have greatly developed, and are preparing a stronger attack upon the markets outside of Japan.

The Japanese have learnt other things, besides manufacturing and trading, from the West. They have learnt how to cover commercial aspirations with a halo of sanctity, as witness the following quotation from the Editorial in the paper mentioned above :

We repeat here that the object of overseas expansion of a nation is to open up the natural resources of the undeveloped lands, and to spread the civilisation in uncivilised regions. Any country which contravenes this common principles of humanity should at this opportunity realise the fundamental mistake of shutting the doors of the country to foreigners.

Japan’s neighbour, China, could say a lot on the first part of the quotation, while the last part is a knock at Russia, for “In Asia, there is a vast undeveloped territory of fertile soil in Russian Siberia” !

The harbour facilities of Japan have been greatly improved lately, and the number of ports open to foreign trade increased up to forty-one, of which by far the most important are Yokohama, Kobe and Osaka.

The way the Japanese set about capturing foreign trade is German in its thoroughness. The following quotation will illustrate how they do it :—

The Foreign Office has decided to send Mr. Vakichiro Suma, one of the administrative officials belonging to the Office, to East Africa by either the Asama or the Yakumo of the Japanese Training Squadron, which is to cruise along the East African coast via Turkey, Malta, Marseilles, Barcelona, and Cape of Good Hope, for the first time.

Gilmac.

(To be concluded next month.)

The Gulf: one year later (1992)

From the January 1992 issue of the Socialist Standard

With the dust from Kuwait's burnt oil-wells barely settled, the race is on for UK companies to beat their rivals back into the Gulf, with rich pickings on offer from reconstructing Kuwait's war-ravaged economy and the return of local dictators to their old playgrounds. And just to show that the pursuit of profit knows no boundaries of race, religion or nation, British companies are again climbing into bed with the “bloodthirsty mullahs" in Iran, as they too seek to rebuild a country laid waste by Iraqi bombs and missiles— also supplied, of course, by US and British companies.

Last May, just three months after the Gulf War finished. US business announced the resumption of its offensive when Al-Ahlia-Gulf Line, bottler of Coca-Cola for the United Arab Emirates (UAE) and Oman, commissioned the first modern, high speed multi-packaging machine in the Middle East. According to company general manager Jim Hill, this followed “extensive tests over the past 12 months in the local Dubai market". So even as US bombs fell in neighbouring Kuwait and in Iraq, the sharp suits from Coke were planning their own offensive on the pockets and teeth of Middle Eastern youth.

British companies could not take this sort of thing lying down. The massive participation by Britain in the Gulf War—where it supplied the second largest Allied contingent—was undertaken not for protecting Kuwaiti sovereignty, nor out of particular concern for its oil. British troops were in the Gulf to stop the domino-like internal collapse of Saudi Arabia and the other four states of the Gulf Cooperation Council—Qatar, Bahrain, the UAE and Oman—which could easily have followed an Iraqi victory and a triumphalist Saddam calling on the people of the region to rise up against their corrupt and despotic rulers.

And why this touching concern? Because British trade with the Gulf states is currently worth well over £4 billion a year, according to figures compiled by the Department of Trade and Industry. Last year, as the Gulf crisis was unwinding. British, companies did some £2 billion worth of business with Saudi Arabia alone. So now the British government is anxious that its support for the local dictators during the war results in adequate rewards for the British companies it is there to represent.

The first post-war move came from the Birmingham Chamber of Industry and Commerce, which organised a tour with the DTI of 32 British companies to Saudi Arabia, which returned in triumph with over £3.25 million in confirmed orders. “This was the most successful mission in 25 years of overseas promotion work,” Birmingham Chamber of Commerce leader Mike Turner proudly announced. A vast amount of restocking was taking place in the parts of the kingdom most affected by the war, a process being exaggerated as Saudi businessmen pump supplies into Kuwait, said Mr Turner. Interestingly, he also reported that members of the Kuwaiti elite, unimpressed by the money making opportunities in their shell-shocked native land, were to be seen wandering neighbouring states transacting all sorts of business there. Mr Turner’s advice to recession-struck companies in the UK was to visit the region in person—"the rewards are there for companies taking the trouble”.

Business interests

The government was not slow in taking up his suggestion. Whatever accusations have been laid against the DTI for “inaction" during the domestic recession, the same cannot be said for the way it sprang forward as the champion of British business interests in the Middle East, loudly announcing a Britain in the Gulf 92 exhibition to be held in Dubai at the end of April.

Any interested readers—and particularly those about to lose their homes through mortgage or rent arrears—should apply by the end of this month at the latest to take advantage of the very generous level of support being offered by the DTI. “Eligible British companies will recieve a 50 percent subsidy on the cost of a standard, 15 square metre stand”, proclaims the DTI's promotional literature. "This will include company name, carpet, flower arrangements, furniture (1 table. 3 chairs) and stand cleaning"—the latter presumably undertaken at competitive rates by some of the tens of thousands of Palestinians or other "foreign” workers expelled by the Kuwaiti leadership since its return from a heroic exile. In addition, the DTI offers a "subvention” (not a subsidy, you understand) to cover one third of the not inconsiderable costs of up to two representatives per company.

"In the aftermath of the Gulf War, Anglo-Gulf relations have never been better", enthuses Britain in the Gulf 92 News. "The DTI attaches the highest importance to sustaining and enhancing the level of British trade with the six countries of the Gulf Cooperation Council”. And it is not only the DTI which is involved in pushing British business in the region. “The campaign began in December and includes reports and special programmes through the BBC Arabic Service and the Central Office of Information". So much for BBC's lofty claims to "independence”—“Nation Shall Sell Unto Nation" should perhaps be its motto in the Middle East.

The Gulf War victory by the US and its allies has ensured that Dubai remains a safe place for UK business: "The pro-business policies of the government arc reflected in the liberal regulatory environments which include no taxation on profits or incomes, nor foreign exchange controls”, says the DTI. The good citizens of Dubai earned the undying respect of the DTI by ignoring the crisis enveloping the region last year and buying 13 percent more from the UK, bringing total exports to the UAE as a whole to £R600 million in 1990.

International Conferences and Exhibitions Ltd, which is jointly arranging the Gulf 92 exhibition with the DTI, was the only exhibition organiser in Dubai to carry out its programme of events during the Gulf crisis. And the response of a grateful Dubai business class to having their skins saved by British tanks, was to endow British firms at the Opportunity in the Gulf exhibition—held in Dubai three months after the ending of hostilities—with a further £20 million worth of orders, with the same amount again anticipated for the near future.

Gulf elites

And business opportunities in the region now extend much further that the basic construction, power and transport contracts of yore, argues the DTI. The Gulf elite clearly feels secure enough to enjoy the better things in life again:

The high level of government expenditure is fuelling a boom in private sector investment, reflected in a spate of new high rise office developments, five star hotels, apartment blocks, sports clubs, shopping malls and luxury villas, all of which require a full range of luxury fittings.

It also generates the need for a whole lot more services essential to the well-being of redundant oil workers, refugees and displaced peoples throughout the region—things like "printing, advertising and financial expertise”.The children of the rich are also back to unrestrained consumption, it would seem, with consumer spending being "stimulated to record levels on items such as clothing, domestic appliances, cars, food and drink, jewellery, sports equipment and overseas travel”.

A list of companies so far enlisted for the DTI's Gulf 92 extravaganza tells its own story. Starlite Chandeliers, for example, is exhibiting a range of crystal chandeliers and light fittings, while Gainsborough Silver Collections will be displaying "a selection of pieces from its comprehensive range of silver plated tableware”. The list goes on to include limousine converters and Moores of London's "corporate jewellery in solid silver and gold plate", and so on.

Finally, what of the Iranian connection?

The carefully planned visitor promotion campaign for the Britain in the Gulf 92 exhibition will cover the six Gulf Cooperation Council states and also extend to Iran, a country with which Dubai has close trading ties.

Could this be the same country the British government sanctimoniously severed diplomatic ties with after its leader issued a death threat against Salman Rushdie which has still not been withdrawn? Yes indeed, and here is the reason:

In addition to the massive rebuilding programme planned for Kuwait, reconstruction schemes in neighbouring Iran, only 40 minutes flight from Dubai, are also arousing unprecedented interest on the part of UK exporters.

So if the government starts to backpedal on its stance against Iranian state terrorism—by banning demonstrations by Rushdie supporters, for example, which it actually did in November—you will know the reason why.

Andrew Thomas

Proper Gander: Brexit And Exports (2021)

The Proper Gander Column from the August 2021 issue of the Socialist Standard 

The pandemic has understandably pushed Brexit out of the limelight recently. But an edition of BBC One’s Panorama reminded us that the issue drags on, and has impacted on how many businesses which export overseas run. Brexit: Six Months On follows several ‘UK businesses at the sharp end of Brexit’ and how they have managed through top-down changes to the market they have to operate within.

One common complaint is the burgeoning bureaucracy now involved in transporting commodities to Europe. For Loch Fyne Seafarms, a shellfish business in west Scotland, one delivery to a European Union country used to involve one delivery note, whereas now there are over 80 pages of tiresome forms which take hours to complete. ‘Paperwork, paperwork. It’s just madness. It’s so much a waste of paper, a waste of time, a waste to the environment, a waste to cost’ says managing director Jamie McMillan. One piece of required admin is a ‘transit declaration’, a messy procedure involving umpteen reference numbers from umpteen different databases. Another food exporter featured in the programme, Creative Nature, faced headaches from other Brexit-related regulations. A planned delivery to Malta got delayed for months while they argued that their vegan snack bars don’t need the same certification as animal products, and then while they added mandatory new labelling to all their Europe-bound stocks. An estimate from before Britain left the EU said that all this kind of knotty red tape would cost British-based businesses £7.5 billion a year. As well as costs taken up by the time taken to plough through additional admin, firms have also had to pay out for customs fees and health certificates when exporting to Europe. For Jamie McMillan these are equivalent to tariff costs which Boris Johnson boasted wouldn’t be part of his ‘jumbo’ Brexit deal. Small businesses are particularly vulnerable to financial pressures from increased costs (compounded by the pandemic), lacking the resources and capital which allow larger companies a little more security. In time, it’s likely that protocols will change so that costs are reduced, because costs eat into profits. Ultimately, Brexit means a shift in the markets so that some profits end up going to different capitalists than they otherwise would have. Along the way, the weakest businesses will go bust, wrecking the livelihoods of their staff, although the documentary doesn’t cover businesses cut off by ‘the sharp end of Brexit’.

The new complications and costs of exporting to EU countries have meant that many British companies have found that it’s easier and more lucrative to transport goods elsewhere, or they have needed to do this to survive. Loch Fyne Seafarms stopped exporting to Europe altogether and instead switched to places such as Singapore, Hong Kong and Taiwan. Similarly, Creative Nature decided to concentrate on the Middle East and American markets. It might sound counter-intuitive for it to be more worthwhile to export thousands of miles further, especially considering the additional pollution caused by moving shellfish or snack bars halfway round the world to places which could probably produce them anyway. But the market isn’t driven by what’s practical or sustainable, nor by genuine needs and wants, but by whatever’s more profitable.

Concert equipment transporters Stagetruck fell foul of new rules restricting how they can operate overseas. Lorries registered in the UK can no longer make more than two drop-offs in Europe, causing a problem because their business supports musicians on tour across multiple venues. To get round the change, Stagetruck built a new base in Holland for their lorries to be registered from, and then had to arrange Irish driving licences for their British drivers so they could travel around Europe. Lynas Foodservice, also featured in the documentary, is based in Northern Ireland, which is still part of the European Single Market and therefore subject to specific rules complicating how they deal with British companies. Its managing director Andrew Lynas says that nowadays it seems easier to attend a trade show in France than one in England. The convoluted way which these and other firms have had to manoeuvre around the system highlights its absurdity. The root of the problem here isn’t Brexit, but rather in nation states and the way that they divide up people. Legislation, policies and procedures formalise and normalise this, clogging up our lives and alienating us from others. Panorama: Brexit: Six Months On doesn’t reach this conclusion, of course, its analysis not looking deeply into capitalism’s workings, and certainly not beyond them.

The programme includes the views of a few economists, such as Julian Jessop of the Institute of Economic Affairs. An optimist about Brexit, he claims that shocks to the economy can have a positive impact if they make businesses think about doing things in a fresh way. In other words: treat ‘em mean to keep ‘em keen, which could be one of the guiding principles of capitalism itself. All that businesses can do is try to adapt to different circumstances, not having any say over what the legislators decide, nor, more fundamentally, any control over market forces. And this is the case whether or not Britain is part of Europe.

Mike Foster

More joy for miners. (1924)

From the August 1924 issue of the Socialist Standard

The Daily News “Trade Survey” is a column always worth reading. Take that of June 6, for instance. You will there discover that our coal export trade is, in a manner of speaking, going rapidly to pot. According to the returns, our coal exports for April were 24 per cent. less than last year’s monthly average and the worst for two years. What has happened? This :— 

  "Since the collapse of passive resistance in the Ruhr, France, Belgium, Italy and Luxembourg have been obtaining from Germany a large amount of the coal supplies they were previously compelled to obtain from Great Britain. Last year France and Luxembourg were able to extract from German sources only 420,000 tons a month on an average. In April of the present year the amount received was more than 1,300,000 tons.

  

  Continental countries outside Germany are winning coal from their own territories on an increasing scale. The mines of Northern France are back again practically to the pre-war rate of production ; Holland and Belgium are producing at more than the pre-war rate.”

This is good news indeed for the miner. Those who formed part of the late Miners’ Battalion will feel especially ecstatic. Those who are satisfied with Capitalism are about to experience another example of its manifold benefits to the working class in general and the miners in particular. We may as well complete the quotation :—

   “Those who take a pessimistic view point out that more distant markets, such as South Africa, India, and the Far East are drawing less on British and more on their native sources of supply; that the navies of the world were in pre-war times coal-driven, and are now oil-driven, while oil bunkers are becoming steadily more popular in the mercantile marine.”

Of course there is a moral. In fact, two. Perhaps you would like to hear the Daily News man’s first:—

  “The moral is that, as British coal has much less of a monopoly in various markets of the world than in pre-war days, every effort should be made to sell at a competitive price which, in turn, involves the adoption of the most efficient and economical means of production at home in, and the consent of the workers, if need be, to possible sacrifices as regards wages and hours of labour.“

“If need be?” “Need” will “be” all right, one may depend. You may or may not like that moral. This is the other : As the coal mines are owned by a small and useless group of people who only allow them to be used when a profit to themselves is assured, and who, further, take advantage of our propertyless condition to hire us for the price of subsistence; and as, further, the whole of industry is run upon the same basis, we will join with our fellow slaves in all occupations, and seizing the mines, the railways, the land and the factories, will become our own masters and abolish the rule of the few.

We hope you like the second moral better.

W. T. Hopley

50 Years Ago: Lancashire Textiles and Chinese Competition (1958)

The 50 Years Ago column from the February 1958 issue of the Socialist Standard

Lancashire Textiles and Chinese Competition, 1908

“Mr. Theodore C. Taylor, M.P., recently visited Japan and China, and, as a result of his investigations, he urges that if we (i.e., British capitalists) are to retain our hold upon the world’s markets, our aim must be better work and more work in the time, to correspond with the shorter hours we now work. As yet, he says, it is mainly in coarse counts that China and Japan compete with Lancashire, but he sees nothing to prevent their spinning finer counts as well.”

(From the Socialist Standard, Feb., 1908).

Lancashire Textiles and Chinese Competition, 1958

For the first time for 200 years Britain is buying more cotton textiles from foreign lands than Lancashire is exporting for sale overseas. So says Roger Malcolm Lee, chief of the mighty Lancashire Cotton Corporation, who tells shareholders that imports are now exceeding exports because of cheap cloth coming in from India, Hong Kong, Pakistan, and China.

“Latterly,” he says, “imports from China have attained alarming proportions.”

Sales of Chinese cloth are made at prices “unrelated to actual costs of production.” They are obviously made “at political prices” he says.

(From the Daily Express, 31 December, 1957.)