Early days of globalisation (2006)

Book Review from the December 2006 issue of the Socialist Standard

The Corporation that Changed the World: How the East India Company Shaped the Modern Multinational by Nick Robins (Pluto Press)

I often gauge how much I have enjoyed a book by the amount of highlighting and marginal notes I make in pencil. This book, like many on my shelves, will horrify those who prize pristine, unmarked first editions.

On 31 December 1600 a precursor of the modern transnational corporation came into existence. Its pioneering techniques in the field of trade and commerce, and downright murder and corruption, preceded by centuries the noxious business practices that we associate with today’s all-powerful corporations, many of whom have a higher turn over than small countries.

This book presents as a meticulous account of perhaps the most powerful corporation that ever lived, tracing how it came into existence, how it operated, its inner structure, the role of its own armies in its rise to supremacy, its part in the Bengal Famine when 10 million died as a result of the Company’s market manipulation, its militaristic role in the Opium Wars, its part in the Indian Mutiny and the Boston Tea Party and how, for the last twenty years of its existence, it ruled India as an agent of the British Empire. When it comes to downright exploitation, corruption, slaughter and sheer negligence and indifference to the suffering of others, perhaps no company that ever existed comes near the East India Company in its ruthless pursuit of profit, whilst refashioning the world commercial order in the interests of privilege and power for hundreds of years to come.

In its time the company had many critics, most notably Edmund Burke, “the real champion of India’s identity”, Adam Smith and Karl Marx. Burke fought long and hard to impeach the Company’s Governor General Warren Hastings for the devastation wrought on India in its endless search for profit.

Commencing his opening speech at Westminster Hall in February 1788, Burke said:

“I impeach him in the name of the people of India, whose laws, rights and liberties, he has subverted, whose properties he has destroyed, whose country he has laid waste and desolate . . . I impeach him in the name of human nature itself, which he has cruelly outraged, injured and oppressed, in both sexes, in very age, rank, situation and conditions of life.”

Despite Burke’s opening four day tirade against Hastings – one of the longest opening speeches in history – during which women were carried out fainting, at which the Speaker was “rendered speechless” and at which spectators were willing to pay ú50 for a seat, despite an ensuing trial that lasted from February 1787 to April 1795, Hastings was acquitted.

Considering the Company’s operations for the New York Daily Tribune in the summer of 1853, Marx noted five characteristics: 

“ . . . a permanent financial deficit, a regular over-supply of wars, and no supply at all of public works, an abominable system of taxation, and a no less abominable system, of justice and law..”

Satirising the Company’s administrative system, he commented how there existed “no government by which so much is written and so little done.” Marx furthermore viewed the company as a tool of British capitalism plc in India, observing how “the aristocracy wanted to conquer it, the moneyocracy wanted to plunder it and the millocracy to undersell it”.

The Second Opium War was, in Marx’s view, attributable to the Company’s operations in the East and its insistence that it had the right to swamp China with drugs in the name of profit, regardless of the addiction-induced misery its trade created or how the Chinese authorities felt. He wrote:

“While openly preaching free trade in poison, it secretly defends the monopoly of its manufacture. Whenever we look closely into the nature of British free trade, monopoly is pretty generally found to, lie at the bottom of its ’freedom’”.

In eight carefully researched chapters, Robins traces the Company’s operations from its inception as a trader in spices to its role in running the Indian sub-continent on behalf of the British crown, withholding, one imagines, very little regardless how gruesome, and there indeed are some stomach-churning passages.

In the final chapter, his analysis masterly done, Robins, contemplating the state of corporate play today, reflects how the Company’s legacy reveals the importance of taking on the mega-corporations who presently rampage across the planet unhindered, and this, for socialists, is the book’s one failing.

Robins’ remedy for curbing corporate power is simple:

“First of all, its market power and political influence must be limited . . Next, stringent rules are needed to ensure that management and investors do not use the corporation as a tool for their short-term interests . . And, finally, clear and forcible systems of justice have to be in place to hold the corporation to account for damage to society and the environment.”

Thus, a brilliant attack on unchecked power in the pursuit of profit is marred by the simple request that the capitalist class behaves and shows a little more respect when carrying out its obscene business, and that the executive arm of capitalism – government – hurries to the rescue of society and the natural environment. Smiley-faced capitalism is, for Robins, the only remedy. Warren Hastings laughs in his grave.

All said, if you’re into the study of corporate power gone mad, read this.

John Bissett

The Party System. And why the workers received the franchise. (1914)

From the June 1914 issue of the Socialist Standard

The Necessity for the Party System.

“In every historical epoch the prevailing mode of economic production and exchange, and the social organisation necessarily following from it, form the basis upon which is built up, and from which alone can be explained, the political and intellectual history of that epoch.”

The frequency with which working-class questions are brought before Parliament to-day goes far to prove this scientific truth, so far as its political application is concerned. Industrial questions and disputes occupy an increasing amount of Parliamentary time. Working-class problems as they affect the capitalist, become more insistent and call for more attention from their representatives on the executive body. How to deal with the growing “unrest” is fast becoming the chief problem before Parliament, and mere party questions sink into insignificance beside it.

The inability of politicians to work up issues that will obscure the line of cleavage between the two classes in society, becomes more apparent daily.

Without friction the party system must necessarily be a failure. For although every party question ends in a compromise, both sides carry on the sham fight as though complete victory were of vital importance to them. The working class have to be deluded into the belief that the fight is real, and that they are concerned in it. A compromise effected, a new Act or Budget passed, without being first staged, without the “exciting scenes, noisy incidents and protracted debates”, would be an opportunity lost of deluding the workers. Without friction and agitation the workers cannot be divided to ensure their united support for capitalism – but one of the many inherent contradictions of capitalist society.

“Politics”, says Edward Jenks, “is the business of government”. In other words, politics is the art of keeping a slave class in subjection.

This business of government is really more of an art than most people imagine. The most arbitrary rulers of the Middle Ages could not rule exactly as they chose. Slaves, no matter how docile, hold fast to ideas and customs which their rulers are, in the main, compelled to recognise

Increasing Difficulties of the Capitalist Class.

When a system advances toward its disintegration, the forces encountered by the ruling class demand greater cunning, resource, and courage to cope with them – just the qualities they have allowed to decay while revelling in fancied security. The revolution of the capitalist class in England and France against the monarchy and nobility found the latter muddled and weak – the result of generations of vice and debauchery.

In like manner, the capitalist class to-day cannot supply the brains to carry on the business of government. They have to breed or encourage professional politicians from the class beneath them. The days of their “directing ability” passed with the manufacturing period. The introduction of power-driven machinery, and the growth of limited companies stripped them of their last economic function, and left them without the necessity to struggle. That they are forced to requisition fresh blood from outside their class to fight against the awakening working class proclaims the rapid progress of their senile decay.

The ruling class of our day is a parasitic organism devouring the substance produced by the working class. It is an organism within an organism, and is compelled to adapt itself to its surroundings. It rules, and yet is governed by its environment, and restricted by the limitations of the system it imposes, and the principles it is compelled to adopt.

Compelled to Confer the Franchise.

How the capitalist class were compelled to confer the franchise, and must continually extend it, is shown by the position in Russia during the past few years, where the constitutional question is not even yet fought out. There is no pretence of giving the workers the vote because it is their right, or because it will benefit them. It is given merely because it means an improved form of government. M. Shingareff in the Budget debate said: “Our Government is strangely opposing itself to the all-powerful spirit of the times. It has no organic union with the country, and with its own hands is digging an abyss between the population and the administration”.

Stability is the object to be attained, and the capitalists of Russia look with envy on the English form of government because it possesses that quality in a greater degree than their own government by oligarchy.

Those Ministers and politicians here who realise the value of the party system, speak their minds when it is in any way threatened. When, in 1910, a Liberal finance bill was in danger of mutilation by the House of Lords, Mr. Lloyd George told the opposition they were not playing the game, and that “If the party system were destroyed, the class line must become the line of demarcation”.

Again, in 1909 he said: “Is it not a real advantage to the country that there should be two great parties, each capable in turn of providing responsible administration for the service of the Crown? How much better our system of government, as worked upon this balance, than in those countries where there is a permanent governing class, with all those interests of wealth and privilege massed around them, keeping the rest of their fellow-countrymen in sullen subjection by force of arms”.

Tweedledum and Tweedledee.

Lord Haldane, at the Royal Academy Banquet, referred to the growing education of the working class and the danger of allowing affairs to drift: the crisis could be forestalled by broadening the basis of the Constitution so as to give it stability.

How our masters yearn for stability as their “cheap and nasty” system evolves! But the sands are shifting beneath their feet – the Rock of Ages is not only cleft, but barren.

Party politics are like the murky fluid ejected by certain denizens of the deep – they only conceal for a time. When capitalist interests are threatened by the workers both parties reveal themselves as one class.

That one man should have formulated the principles for both sides in the Parliamentary game is significant, and strengthens the conviction that it is but a game – mutually arranged – after all.

Edmund Burke, says Trevelyan, quoting from Moore’s Life of Sheridan, “has left behind him two separate and distinct armouries of opinion, from which both Whig and Tory may furnish themselves with weapons, the most splendid, if not the most highly tempered, that ever genius and eloquence have condescended to bequeath to party”.

His genius was needed. Capitalist domination was scarcely established before it was in difficulties; Burke, according to Lecky, was its saviour. In vol. III, History of the Eighteenth Century, he says: “It was necessary, in the face of the mass of discontent which was smouldering in the nation, and the growing corruption and inefficiency of Parliament, that each party should have a distinct line of policy. As time went on, these lines, as we shall see, became clearer, and the writings of Burke probably contributed more than any other single influence to define them.”

An Old Fraud with a New Face.

It is the continual boast of modern politicians that we live in a democratic State. When they say “we” they mean, of course, the ruling class. They see to it that neither King, lords, nor demagogues filch their “democratic” rights. But the so-called democracy conferred on the working class is not a semblance even of the real thing. Two thousand years ago Athens boasted in similar fashion of the democratic State, and the chief principle of the Athenians was that while there existed one man in the community who suffered in justice through the operation of the State laws, the others should not rest until his wrongs had been righted. An injury to one held possibilities of injury to all. But beneath this free and high-principled class was another class, chattel-slaves to them, who had no rights but what were willed to them by their owners.

This same description applies to the working class of to-day. They are driven into the workshops of the capitalist by hunger. They must sell their labour-power for what it costs them to live. When the capitalist has no market for the products of their labour they are driven out again – to starve. The over-crowded labour market is the spur to increased activity inside the workshops; greater concentration and efficiency are called for by the masters and easily obtained. Competition and unemployment haunt the modern worker like a nightmare, and every year bring him more helplessly under the control of the capitalist, who dictates all the hum-drum details that go to make up the wage slave’s wretched existence.

Liberal or Tory – what a choice for those who are robbed by both alike and left poor under either! This, they say, is democracy! It is the limit in impudence; the last word in bare-faced hypocrisy. “Millions of workers are stripped of everything but the bare necessities of life”, says Winston Churchill; of what use is a vote to these, when they can only give it back to those who gave it them – the capitalists?

The vote they were compelled to give, though they made a virtue out of necessity and said they gave it because they loved the principles of democracy. But no matter how they got them, the workers have far more votes than their masters. With the knowledge of their slave-position and the courage to organise, these votes can be used as the means to their emancipation. The capitalist class cannot abjure what they have established. The vote was given to secure their own domination; if they discard it they lose control and have no sanction to govern.

By constitutional methods the workers can win their freedom; they have no need to go outside the Constitution until they finally destroy it. So the party system together with the franchise – established because they promised stability – pave the way for working-class victory.

Real democracy will come with Socialism; when the game of party bluff has been played for the last time to unresponsive workers – when the latter are busy with their own interests, determined to enjoy the full results of their labour. The party system will be exposed as a fraud, consciously practised by the ruling class in their own interest. Its records will go down to posterity as curiosities, and future generations may read them and marvel that a working class, sunk in poverty and anarchy, could forget, even for a moment, their own wretchedness, while they voted this way or that on questions that concerned their masters alone.

F. Foan

Blogger's Note:

The quote at the top of the article is from Engels' introduction to the 1888 English edition of the Communist Manifesto.

Democracy and Delegates (2019)

From the April 2019 issue of the Socialist Standard

When eight MPs resigned from the Labour Party to form a new political group, the so-called ‘Independent Group’, the call naturally went up for them to resign and contest a by-election under their new political colours. Equally naturally (since they all expected to lose any by-election) they refused. They were supported in this by most of the media on ‘constitutional’ grounds – that MPs are not the delegates of those who voted for them. As the Times (22 February) put it in an editorial entitled ‘Democracy and Conscience’:

  In a deliberative democracy, the role of elected representatives is not to implement instructions. Rather, they owe it to their constituents to act on, as Edmund Burke put it to the electors of Bristol in 1774, their unbiased opinion, mature judgement and enlightened conscience.

That’s clear, except that the term ‘deliberative democracy’ is tendentious as why can’t democratically-elected delegates deliberate?

Another opponent of ‘the delegate theory of representation,’ as he called it, was John Stuart Mill (in chapter 12 of his 1861 Representative Government, still taught in universities). He was against this because he thought that, with universal suffrage (to which he was opposed), it would mean ‘the exclusive rule of the operating classes’. He openly advocated ‘leaving an unfettered discretion to the representative’ as a way to prevent the working class imposing ‘class legislation’ in its interest.

So, the theory that elected representatives should have a free hand to vote as they chose, even if this choice was not what those who elected wanted, and that they cannot be removed if they went against their electors’ wishes, originated as an anti-democratic, anti-working-class constitutional practice.

The opposite view – that elected representatives should be subject to control by those who elected them – was the democratic view and, in the nineteenth century, was implemented in some cantons in Switzerland and some of the states of the USA, through provisions for electors to recall those they had elected. Recall votes still take place regularly in the US. The re-election of the US House of Representatives every two years is also a way of making elected representatives responsible to those who elected them (and why ‘annual parliaments’ was one of the Chartists’ six demands, the only one not to have been implemented). It means that electors there can change their representatives if they want after a relatively short period, whereas in Britain they can only do this every five years. Ironically then, had the eight Labour and three Tory defectors been members of the US House of Representatives they would not have been able to hang on for a further three years as they now are.

The Times, however, smeared the democratic position by associating it with Lenin:

  The alternative notion that officials are mere delegates does have a philosophical lineage. It is to be found in Lenin’s The State and Revolution. This revolutionary blueprint was a guarantee that Russia under the Bolsheviks would become a totalitarian state.

This is wrong on two counts. First, as just pointed out, this view goes back a long way before Lenin and, second, Lenin’s endorsement of it was not sincere or followed by any attempt to implement it.

Mill gave an example from the seventeenth and eighteenth centuries:

  In the Dutch United Provinces, the members of the States General were mere delegates; and to such a length was the doctrine carried, that when any important question arose which had not been provided for in their instructions, they had to refer back to their constituents, exactly as an ambassador does to the government from which he is accredited.

Another example is the arrangement proposed for France by the Paris Commune, a democratic popular uprising that took over Paris at the end of the Franco-Prussian War of 1870-1. As described by Marx:

  The rural communes of every district were to administer their common affairs by an assembly of delegates in the central town, and these district assemblies were again to send deputies to the National Delegation in Paris, each delegate to be at any time revocable and bound by the mandat impératif (formal instructions) of his constituents (The Civil War in France).

This is what anarchists advocate to this day. It was never implemented as the Paris Commune was ruthlessly suppressed in blood by the French government after less than two month’s existence. While it existed, as Marx noted with approval:

  The Commune was formed of the municipal councillors, chosen by universal suffrage in the various wards of the town, responsible and revocable at short terms.

Lenin, who considered himself a Marxist, had to pay lip-service to this and duly quoted in his The State and Revolution, written in July 1917, this endorsement by Marx of a body elected by universal suffrage whose members were subject to recall ‘at short terms’ as the model political form. But he later switched the emphasis from elected councillors to public servants and wrote of these being reduced to the role of ‘simply carrying out our instructions as responsible, revocable, modestly paid “foremen and bookkeepers”’. By ‘our’ he meant the working class, but represented not by elected delegates but by a vanguard party that had appointed itself to represent them. This was quite different from what the Paris Commune practised and what Marx envisaged; it was a blueprint for a one-party dictatorship where any public servant considered to be not carrying out the instructions of the leaders of the vanguard party could be instantly ‘revoked’, i.e., sacked. After the Bolsheviks seized power in November 1917 one of their first acts was to dissolve the Constituent Assembly that had been elected by universal suffrage and the ‘revocation’ (and worse, imprisonment and exile) of their opponents began. Lenin wasn’t any kind of democrat, let alone a supporter of delegate democracy.

Some form of delegate democracy has to be the basis of the administrative structure in socialism as this will necessarily be a democratic society. Those elected cannot be left ‘an unfettered discretion’ to decide according to ‘their unbiased [oh, yes?] opinion, mature judgement and enlightened conscience’ as proposed by the anti-democrats Burke and Mill. That would be a recipe for class rule, as it was intended to be.

Adam Buick

One person, one vote (1981)

From the December 1981 issue of the Socialist Standard

Down the centuries upholders of privilege have recognised and feared the power of the masses to overthrow the rulers of society; but it took a poet to flip the coin of fear and turn it into a joke:

If you make a revolution, make it for fun,
don't make it in ghastly seriousness,
don't do it in deadly earnest . . .
do it just to spit in their eye.
(D. H. Lawrence, A Sane Revolution.)

Fear, irony and humour characterise the responses of many who contemplate for long the oddity that rulers are few and the ruled are many. Plato thought about it a lot:

The third group is the mass of the people, who earn their own living, take little interest in politics, and aren't very well off. They are the largest class in a democracy, and once assembled are supreme.
(Plato, The Republic, p.385, Penguin, 1975)

His ironic response was to spin out an analogy between society and a bee-hive. He wanted all drones cleared out of the hive and replaced by three brainwashed classes of people, presided over by a philosopher-king, who alone stung everyone into submission with a venomous dialectic.

The fearful response to popular power sometimes contains a magical incantation, as when Edmund Burke tried to ward off the evil influence of the French Revolution from his English readers:

We fear God; we look up with awe to kings; with affection to parliaments; with duty to magistrates; with reverence to priests; and with respect to nobility.
(Revolutions 1775-1830. (ed) M. Williams, Penguin, 1971, pp. 108-9.)

It is indeed a heathenish thing for the masses to rise up and bite the hand that whips them!

Goodbye To All That

Fear is creeping into Margaret Thatcher's voice now; with unemployment rising to three million and bankruptcies soaring, and yet insists she's doing us good. Presumably she'll get booted out at the next election and replaced by an earnest Labourite, or a smarmy Liberal-Social Democrat, who'll play at ruling capitalism for a further five years.

What potential for revolution remains among the workers now that parliamentary democracy has made the barricade and the guillotine decadent, even absurd, as a way of removing and chastising Thatcher?

One person, one vote: the implication of this democratic slogan is that there is a revolutionary use for the cube of black-japanned metal — the ballot box. It would not have amused Lawrence, would have puzzled Plato and infuriated Burke; but is something Thatcher and the working class could come to terms with. The ballot can dictate the shape of society. Provided Thatcher displays only the usual amount of incompetence over the next two years, then not the fulminations of Foot, not the hysteria of left-wingers and not the self-starvation of all terrorists will remove her from office. Yet sometime in 1984 she will meekly accept the probable dictate of the ballot box and cease to rule with her usual bad grace. Capitalism could be deposed throughout the world in just the same way; after all, how could an "ism" fight back?

Individuals are the bearers or agents of ideologies. When you vote, you put a cross against the name of someone and the sum total of ideologies borne by the successful names yields the style of society around you — give or take a nuclear hiccup or two. Putting a cross on a ballot for revolution would be much the same — give or take a capitalist or two. What about a world-wide referendum, where the ballot paper reads "capitalism or socialism: place a cross against your choice"?

Hello New World

But the simplest revolutionary use of the ballot box would be to nominate and vote for individuals as bearers of the ideology of the masses — the working class. Theirs is a beautifully simple ideology, well-fitted for revolution. It goes something like this:

Politicians never do the workers any good.
If you want something done, do it yourself.
Labour is the source of wealth and only a fool says otherwise.
You'll never change the world until you get the vast majority to agree.

The political programme to fit this goes as follows:

One person, one vote;
therefore the last thing we need are politicians and leaders;
therefore if anything is to be done to the world all must do their bit;
therefore away with all that nonsense about banks,
advertising and invisible earnings creating wealth — it's brain and brawn that will do it all;
therefore you can stick your United Nations, your summit meetings, your social security plans and all the rest;
we've got to talk it out like we do down the pub — then pick our team.

Strange that a colossal social system like capitalism can be toppled by something as ordinary as the process used by a darts club to choose team members; by the method an angling club uses to select venues for a season; by the way the local women's institute decides who'll make the sausage rolls, make the cakes and cut the sandwiches for the next whist drive. Yet all socialism requires is that workers put their heads together and decide about society, stick their men and women in the parliaments of the world and stick their fingers up at all those who said it couldn't be done.

B. K. McNeeney