Unemployment – profits first! (1972)

From the November 1972 issue of the Socialist Standard

The first thing to note about unemployment is that it is a working class problem. A problem which only afflicts those who normally function as wage workers or employees.

The permanent non-producing existence of the capitalist class is not regarded as unemployment. They are a class which either privately, or through the State, function as an exploiting class. Their dominance over the means of production gives them a privileged position as wealth controllers, they have access to surplus value, and since as a class they are employers they never suffer from unemployment.

For unemployment to arise and be regarded as a dire social problem, a class must exist in society whose condition of life is mean and degrading. To be able to sell their working abilities for wages, to find an employer who will harness them like beasts of burden to his machinery of production, so that their lives may be spent producing wealth they do not own, is far preferable to being unused in a state of forced idleness.

Further, this alienated and dehumanised mode of existence must be their only means of gaining a livelihood. Such a class must depend on its income from wages or salaries, must have no property that would relieve them of the need to toil—no means of living save through prostituting their physical and mental energies on the labour market as employees.

Such a class exists all over the world. They are the working class.

Ideally they should be so conditioned to their slave position in life as to aspire only to demanding “the right to work”. To deny the slave his toil and his pittance is the last straw, the final insult. Capitalism for all its ills and woes can be tolerated with the occasional groan so long as there is work. Deny him his humanity. Deny him his personality. Deny him his freedom. This he can accept. But to deny him work is to affront him. He will produce all the wonders of modern science and technology. He will fashion and erect the most lavish hotels and luxury mansions, design and produce the most expensive jewellery and beautiful yachts, fine clothing and costly furs, wonderful ocean liners and a vast variety of delicate foods, and he will be content to live in squalid slums, wear inferior clothing, and eat adulterated food while “bargaining” only over the price at which he sells himself.

He will make do with the sham, the shoddy and the make-believe, so long as he is permitted to work. Work itself comes to equate with employment. And employment comes to equate with life.

This is the background against which unemployment must be understood. If unemployment means hardship, misery and deprivation, it is because poverty and insecurity are always with the worker.

Work is vital to the class of employees, not because they are docile, but because they depend upon wages to live. Their behaviour is determined by their position in the private property relationships of capitalism. They accept this position from want of an understanding of any alternative.

With this in mind, let us look at the current situation.

Shaking Out

Just a year ago the Sunday Times Business News published a report from Nicholas Faith. Unemployment was then 929,000 and it was thought “the gloom is not a temporary one”. It was pointed out that the present decline started in the mid-1960s, under the Labour government. The present government hoped for another upward turn, but it was feared that the investments boom of the 1960s was not sufficient to produce a big enough growth rate, i.e. more than 3 per cent, to take up the slack. The report blamed decades of neglect of capital stock for the low productivity rise, not (be it noted) the laziness of the workers. Capitalism is a system full of contradictions. Not least of its absurdities is the fact that those who run this system are forever screaming about insufficient growth rate, while at the same time nearly a million workers (in Britain alone) are thrown on the scrap heap and industrial resources grossly underused. All this while millions live in slums and many more millions in other countries starve.

In September 1971 Coventry had over 4 per cent unemployed; the figure still stood at 4.4 per cent in July 1972. For forty years Coventry was a boom town, with unemployment below the national average. The average for Great Britain in July was 3.6 per cent. The actual figure for the whole of Britain (early September 1972) was 930,123. Over a thousand more than a year ago, and the highest August figure for 33 years.

In Faith’s report the great “shake out” of 1966/67 is referred to. It is stated that the whole geography of post-war unemployment altered from that period and that “the whole of England outside the South East is now, by historic standards, a depressed area”. The Labour government was of course in power when the “shake out” began. It was in fact Wilson as Prime Minister who coined the phrase “shake out” in arguing that 400,000 was an “acceptable level” of unemployment.

The nationalised industries have been among the worst casualties. It will be recalled that the Labour Party sold nationalisation to the working class as a cure for various social problems, among them profiteering and unemployment.

Now, those mines and rail services which are unprofitable are ruthlessly closed. The process of “shaking out” many tens of thousands of miners and railway workers was at full tilt during Wilson’s Labour government. In Durham for example, miners have been redundant for ten years or more and “retired” whilst still unemployed, and therefore no longer figure in the unemployment statistics.

The changing pattern seems to indicate, according to the Sunday Times, a long-term change in the actual number employed, with unskilled workers over 40 years of age remaining virtually unemployable until they retire. There are 120,000 in this category.

Hopes Deferred

The National Institute for Economic and Social Research was said to be vaguely looking to 1973 and entry into the Common Market, for an investment boom. How vaguely might be seen from the fact that all the major European countries have unemployment problems of their own, with figures up on last year. They too could do with an “investment boom”. Unemployment is also up in the United States over last year, standing at 4,697,000 in April 1972, an increase of 203,000. Russia discreetly refrains from publishing any figures.

Those workers who trusted capitalism and thought they had secure jobs for life, among them the Upper Clyde shipworkers, those at Rolls Royce and in the mining and railway industries, not to mention the docks and many others, have been sadly disillusioned. Capitalism defies all attempts to control it. The Keyensian disciples of the Labour and Tory parties have had to stand powerlessly aside while the tidal wave of depression rises. All they are able to do is advocate more of the same futile policies and hope for the best.

Ramsey MacDonald in 1929/31 had his “economic blizzard”. Attlee did not plan the half-million unemployed of 1947. Wilson was “blown off course” with unemployment averaging over 600,000 during his last year of power.

The so called extreme “left” can demand nothing better than more work, better leadership, reforms and nationalisation. All the same old fallacies they were trotting out forty years ago. The Trotskyists and the “Communist” Party have helped spread the lie that the Labour Party is better for the workers than the Tories, and fostered the illusion that State capitalism can solve unemployment and other working-class problems.

Unemployment has always been a feature of capitalism. An industrial reserve army is the capitalists’ ultimate weapon against wage demands.

When wages reach a level where machinery becomes a better investment, the composition of capital will tend to favour the machine over the worker. Also, intensified world competition for markets produces the same result, namely relatively fewer workers to increasing technology. No major capitalist country can afford to lag too far behind the techniques employed by the fastest. This is the significance of what the Sunday Times calls “decades of neglect” of capital stock.

That’s What it’s All About

Capitalism inevitably creates situations where it chokes on its own surplus products, simply because of its market economy. Expanding industry means that ever wider markets must be found as profitable outlets for the sale of goods. As the whole world is drawn more and more into the orbit of capitalism, so the number of rivals grows and a stage is reached where it is no longer profitable to maintain production of goods which cannot be sold. The costly plant of modern industry demands the mass market. When markets begin to contract or fall to rivals, then unemployment starts to reappear.

The Daily Telegraph (1 October 1971) put it in a nutshell:

“Industry does not function, as some seem to think, to provide jobs. It functions to make profits. And if profits are unduly low as they have been now for at least five years the inevitable result is low investment. New finance becomes hard to get, adaptation and renewal slow down and the decline of jobs in the old industries remains unmatched by a growth of jobs in new industries. No priority, therefore, should rank higher than the restoration of British industry to a proper level of profitability.”

Capitalism can have no higher priority than profits.

The recurring cycle of boom and depression, at ever higher levels of technology, demonstrates more than anything the total inability of capitalism to harness its productive resources to the satisfaction of human needs. It further proves the complete obsolescence of the market economy.

What is really redundant, in terms of social welfare and human happiness, is the private and state ownership of the means of production.

Harry Baldwin

50 Years Ago: Immigrants and unemployment (1988)

The 50 Years Ago column from the September 1988 issue of the Socialist Standard

We are asked if we want foreign workers to take jobs away from British workers, and on the surface it looks like a reasonable point of view. Actually it is baseless. It is true that if an Italian waiter comes to London he may get a job in preference to a British waiter, just as hundreds of thousands of British workers have in the past managed to get jobs in America and many other foreign countries. But unemployment in the mass is not caused by the size of the population and does not increase because the population is increased, whether by births or by immigration. Capitalism everywhere normally has its unemployed, no matter what the population figures may be. If unemployment disappeared, then the workers would be able to demand more wages, and this would reduce profits to the vanishing point. Unemployment is, therefore, a capitalist necessity. The capitalist himself deliberately creates it by installing labour-displacing machinery in the effort to keep costs down and profits up.

[From the editorial "Should aliens be allowed in?" Socialist Standard, September 1938.]

Editorial: On the move . . . (1985)

Editorial from the September 1985 issue of the Socialist Standard

 

. . . for socialism

 

The governments recently introduced board and lodgings rules (see Socialist Standard, June) which forced thousands of young people to move around the country every few weeks or risk having their benefit cut, have been declared illegal in the High Court and the DHSS will be compelled to pay arrears to those whose benefit was reduced.

But it should be noted that it is not on humanitarian grounds that this decision has been made. On the contrary, it was the method by which the regulations were introduced that has been declared unlawful. According to the decision, Norman Fowler had no powers under present legislation to designate board and lodging areas within Britain or lay down time limits for those staying in them.

Mr Justice Mann, hearing the case, made this quite plain when he said:

In my judgement a decision to the effect that able-bodied and independent young people who live on supplementary benefit in lodgings should move from one area to another in search of employment, after a stay judged appropriate for the quest in the first area, does not come within any distance of being outrageous (quoted in The Times. 1 August. 1985).

Maybe he should have taken a look at the annual report of the Manpower Services Commission published at the end of July, which shows that for those aged 18--24 (the age-group affected by the regulation) the unemployment rate is 24 per cent. Of the 1,166.000 unemployed in this age group, 29 per cent have been unemployed for more than a year.

Unemployment is unlikely to affect those present at the American Bar Association's recent London jamboree, where two lawyers gave a paper in which they described the way high unemployment has curbed industrial action and led to lower wage settlements. Unconcerned about the plight of the unemployed themselves, they expressed fear that high unemployment might lead to problems in the future if the apparently docile and compliant work force was in fact saving up their grievances.

The authors have good reason to be worried. But let’s hope that workers do not continue passively to accept the sufferings that capitalism daily serves up, and recognise that strikes for higher pay are not enough. It would be nice to give the American Bar Association something to really worry about — like socialism.

The Rainy Day. (1909)

From the October 1909 issue of the Socialist Standard

The world’s arena has been somewhat crowded latterly, and he must he a singularly moribund individual who has allowed the series of recent world-happenings to drop through his cerebral filter without observing that we are on the eve of stupendous changes. Putting aside the North Pole incident, and even the question of the abolition or retention of the Censor, we think it vastly more important to consider that Japan has jumped out of feudalism into modern capitalism, and that almost within the memory of still young men. Japan hits now quite a number of well equipped, up-to-date cotton mills, with which, she is not only supplying her home demand, but is exporting to China. She is thus a new and dangerous competitor in the international race for markets. Turkey now shows signs of throwing off the sloth of ages and of joining in the scramble. Persia, too, and Egypt, are profiting by the example of their contigious neighbours and are responding to the stimulus of imported civilisation. The tremendous expansive powers of the means of production are, to the intelligent student at least, well known, and it would seem only a question of a very short time, before the countries named pass through the stages of the importation of machinery and staple products to being self-supporting, and at last to that where a surplus is produced and exportation begins. This stage once reached, and possessing a proletariat who can rub along comfortably on twopence or threepence a day, it is easy to see where the trouble will commence. Capital, that remarkably shy bird which is always “going abroad,” will have to either consider the advisability of an inter-planetary trip, or throw up the sponge. The latter process an awakened and intelligent proletariat can materially assist, and our steadily increasing membership tends to show that we are getting this.

Whilst, however, these portentous happenings are being enacted abroad, some no less interesting incidents are occupying the stage at home, in this our own, our native land. The comparatively puny event, the Budget, has been recently dealt with in our columns. Its chief purpose has been to give the Labour Party another opportunity of exhibiting their identity with the enemy, and of justifying the name that Engels applied to their particular hotch-potch of ideas, demands, etc. He called it Flunkeyism.

But to get on, what we would particularly point out is that the period of bad trade, which has been with us now for several years, has apparently developed a deep and abiding affection for us, and in spite of the newspaper predictions of “better next year,” it is still the common experience to find hundreds of applicants for one poorly remunerated job ; still one reads regularly, almost daily, of some poor devil’s suicide through want of employment. And in view of the facts first stated we feel almost justified in assuming that capitalism, at least in Great Britain, has reached that point where good and bad times cease to alternate and we get all depression, or but slight and short returns to “prosperity.” With the home market almost at a standstill owing to the inability of the worker to purchase back more than a mere fraction of his products ; with foreign markets becoming ever more restricted ; with an enormous army of unemployed always on hand and close on a million people classed as paupers: with all these meaning facts confronting them it is very evident that the “masters of the bread” are feeling far from comfortable. The “good time coming” has failed to materialise, so something must be done to quieten working-class unrest and if possible to offer a counter-attraction to the steadily increasing agitation of the wicked Socialist.

Result (1) the Budget, (2) Insurance against Unemployment. The former, as we have observed, has been dealt with in our columns already. It is of the latter we now wish to speak.

Mr. Winston Churchill, in an interview which the Daily Mail (16.8.09) claims to have had with him, was considerate enough to explain the proposed scheme to the interviewer, and in doing so exposed, not only the cloven hoof, but the goat-like haunches, the horned head and leering grin of capitalism’s patron saint, the Father of Lies. The main features of the scheme are these : It will be (1) compulsory ; (2) contributory ; (3) divided up into different sections for different trades.

"Compulsion was necessary. Voluntary schemes fail for the reason that most of those who join them are men likely to be most often unemployed."

See the beautiful and touching solicitude of our rulers for the comfort and well-being of the worker. Only those likely to benefit joined under a voluntary system. What is wanted is a membership composed of men who will only want to pay in and never draw out.

“Contributions from men and employers were also necessary. To begin with, the country could not afford to do without them ; and moreover, the idea is to increase the stability of our institutions by giving the mass of industrial workers a direct interest in maintaining them. With a ‘stake in the country’ in the form of insurance against evil days these workers will pay no attention to the vague promises of revolutionary Socialism.”

Thus Mr. Churchill. The position of the S.P.G.B. regarding palliatives is, or should be, well known, and we think the above a striking confirmation of our attitude. Social reform is the antidote to Socialism. Palliatives are the sops thrown out to keep the workers busy while the capitalists make their position more secure, and serve much the same purpose as the impedimenta thrown out by a man in a sleigh pursued by wolves.

The details of the scheme are also extremely interesting. The amount of subscription is not yet definitely fixed, but will probably be 2½d. per week from the worker, 2½d. a week from the employer, and the same from the State. Every worker is to have a card upon which stamps to the value of his own and his employer’s contribution must be stuck each week. The employer is to affix the stamp, deducting the worker’s 2½d. from his wages. The employer may to save time and trouble, send all his cards to the local labour exchange with a cheque for the amount due, and the cards will be stamped without any further trouble to him.

The labour exchanges and the insurance plan will work closely together. When a worker loses his job he is to report himself to the exchange, which immediately tries to find him work. For a week he receives nothing. It is assumed that he will have saved enough to last him a week, and in the meantime the exchange endeavours to find him a job in order to save the fund.

When the exchange hears of work likely to suit the unemployed worker he must either take it or explain to a committee of masters and men why he objects. If they consider his objection unsatisfactory he is bound to accept the job or lose his out-of-work allowance. If neither the man nor the exchange can find work, than after seven days he begins to receive the tremendous sum of eight shillings or less per week, which may go on for fifteen weeks, or more if the benefits are slightly less. If still out of work after twenty weeks he drops out of benefit, and when next he finds employment must start all over again. The second time he has to subscribe longer before he becomes entitled to claim on the funds. The original period of probation will most probably be eight months. The second will be longer and the third longer still. This will have the effect of clearing the fund of those who are habitually unemployed for long spells. The frequently out-of-work must seek relief of the distress committee : they are outside the limits of the labour exchange and insurance system, which is in no sense charitable. “It is a purely economic and mathematical business arrangement for preventing waste.”

The unemployed problem is a necessary consequence of and an indispensable adjunct to the capitalist method of wealth making. The introduction of machinery and improved methods into industry, renders an increasing number of workers superfluous. These form what Engels calls “the reserve army of labour,” a weapon for crushing the wages of those in work down to mere subsistence level, and also a store from which drafts may be drawn to meet the fluctuations in trade. But the capitalist is faced with another difficulty. The worker’s wage is crushed so near the bare subsistence level that he is unable to put anything away to tide over a spell of unemployment of even short duration. The consequence is that when the capitalist next takes him down off the shelf, he is devitalized, spiritless and out of condition generally, hence not so energetic, not so productive, as the capitalist wants. The proposed scheme of insurance will just provide a few niggardly, shillings to keep the landlord off for a week or two, and with the two or three shillings he has cheated himself out of during the probation period (eight months at least) it is hoped he will keep himself physically fit until the capitalist has need of his services again.

What a hollow sham ! What a mockery ! !

“Many of the greatest employers of labour have warmly welcomed the idea. Sir Charles McLaren, for instance, believes it will add materially to the wealth of the nation.”

Workers, beware when the enemy warmly welcomes anything affecting your relations with him ! You may be fairly sure that it is not for your benefit. When you have a dispute with him as to what constitutes a “fair” portion of your product to hand you back as wages, notice how he “warmly welcomes” the troops who go down to blow your brains out. Notice how he “warmly welcomes” the establishment of conciliation boards when a mere glance at statistics show an ever greater proportion of disputes settled, through them, in favour of the masters. Workers, how long are you going to chase the Will-o’-the-wisps the master class is never tired of contriving for your greater befoolment ? All the budgets, tariff reforms, insurance and other capitalist schemes won’t alter the fact that you have to seek the permission of the owners of the means of life, to work, as a means to live. Nothing save Socialism, the ownership by the people of those means, will change the conditions that make you hirelings, slaves, lackeys; who receive only a fragment of the wealth you alone produce, when you are fortunate enough to be graciously allowed to produce it—for someone else

If you are convinced that in Socialism alone is to be found your only escape, do not wait for someone else to join, but come in and help to build up a solid party. We are often asked how are we going to bring this better state about. Believe us, no select half-dozen are going to do it, but you, and I, and all of us, combined as a class, can do that, and anything else humanly possible that we wish.—when you join. Come in.

Wilfred.

Blogger's Note:

When 'Wilfred' writes: ". .  . The comparatively puny event, the Budget, has been recently dealt with in our columns . . . ",  he's possibly referring to the following editorials from earlier Socialist Standards:

• Jun 1909: Raising the Wind.
• July 1909: A Capitalist Budget.
• Sep 1909: Liberalism’s Last Ditch. 

Capital’s reserve army (1965)

From the October 1965 issue of the Socialist Standard

The capitalist system requires for its proper functioning a reserve army of unemployed workers which it can draw on in times of expansion and cast aside in times of contraction. This remains as true today as when Marx first drew attention to it a hundred years ago. At that time every country had within its borders such an industrial reserve army composed of its own subjects. In Britain today with unemployment since the war at comparatively low levels some people have drawn the conclusion that Capitalism has reformed itself so as to abolish large-scale unemployment. However, Capitalism is an international system, political boundaries don’t matter to it. Industries in all the countries of the world are linked by means of the world market. Looked at from this point of view Capitalism has by no means abolished large-scale unemployment.

International Capitalism may have put to work nearly all the native workers in Britain, France and West Germany, but as Capitalism expands so does its demand for workers. If these can’t be found within a country they must be drawn from outside. This is precisely what has happened. The capitalists of North West Europe have drawn on the reserve of workers in such places as Spain, Italy, Greece, Yugoslavia and Turkey as well as from North Africa, Malta and Cyprus. Britain, France and Holland can also draw on their former colonial territories in the West Indies and in Asia. In these areas which are, as it were, on the outskirts of Capitalism unemployment is very high. But it has been noticed that workers don’t leave just because of high unemployment and low wages. They leave and return in accordance with the needs of Capitalism in the more developed parts of the world. They form a true industrial reserve army. The myth has been created in the post-war years that the boom-slump cycle inherent in the capitalist system has been overcome. This is just not true as any worker in the motor industry could tell you. The indices of industrial production, trade and unemployment still show fluctuations. True, the effects of these fluctuations haven’t been so widespread as in the past, but that’s another matter (connected, in fact, with the growth of non-industrial employment). The point is that such fluctuations do still take place. And migration from the “labour reserves” takes place in accordance with them.

In the quarterly magazine Race, for July, 1965, Ceri Peach has an article, West Indian Migration to Britain: The Economic Factors. The article shows how it is not population density or low economic development in the West Indies that causes migration but rather the demand for workers in Britain. There is a “close relationship” between the demand for labour in the U.K. and West Indian immigration.” Using the totals of unfilled vacancies for adult workers as an index of demand for labour, we get (p. 34):

 Year Labour Demand Index Arrivals from West Indies

1956 934,111 26,441

1957 725,571 22,473

1958 535,186 16,511

1959 653,120 20,397

1960 848,542 45,706

This Table shows that “the number of West Indian arrivals rose and fell in accordance with the demand for labour.” The same goes for people returning. More go back when demand is slack than at other times. “Both in the movement into Britain and in the outward movement to the Caribbean, West Indian migrants have been largely governed by conditions in this country.” The 1962 Commonwealth Immigration Act upset the pattern by causing a rush to beat the ban in a time of slack demand. But now economic factors are beginning to take over again even under the system where migrants have to get a voucher first. The demand and use of these vouchers also fluctuates with conditions in Britain.

There is of course the danger that the existence of large-scale unemployment in places like Jamaica might give rise there to extremist movements which might succeed in overthrowing a friendly government. But this does not necessarily lead to the loss of the labour reserves. Algerians still go to work in France and elsewhere; even the Yugoslav Government encourages emigration to West Germany. And the flow of refugees is not without its use, economic as well as political. Indeed for many years Capitalism in West Germany lived on refugees from the East.

This August the Labour Government announced tougher restrictions on immigration, mainly for political reasons such as the fear of social unrest and the loss of the racialist vote. That this was done for political reasons is obvious since immigration would begin to fall off anyway when the expected slump in industrial production and employment materialises. However, this manoeuvre could easily backfire. What happens when Capitalism begins to expand again? There will be a demand for more workers who can only come from the traditional reserves. Whichever party is in power, and it may well be the Labour Party, will be faced with an awkward political decision. To prevent their entry and thus slow down the expansion or to let them in and face the charge of “bringing in the blacks.” Such are the problems of administering Capitalism!

We see then that Capitalism’s reserve army of unemployed is still as real as ever. Those who argue on the basis of employment conditions in Britain that Capitalism has abolished unemployment fail to realise that Capitalism is a world-wide economic system. Their argument is as invalid as would have been that of someone who in the 1930’s used the employment statistics for the South East to prove that Capitalism had solved the unemployment problem. The plain fact of the matter is that Capitalism, as an international system, has not and cannot.

Adam Buick

50 Years Ago: An implement for digging (2026)

The 50 Years Ago column from the April 2026 issue of the Socialist Standard 

Have you noticed the way today’s politicians are afraid to call a spade a spade and instead resort to every kind of euphemism to disguise the reality of whatever they happen to be talking about? So we have ‘social security’—the Poor Law or National Assistance by any other name—a cynical term indeed. Ask anyone who’s ever had to claim and they’ll tell you there’s little that’s social and nothing that’s secure about it. Perhaps you’ve experienced yourself the interminable form-filling and prying by clerks for a pittance that won’t feed a dog, let alone keep it warm.

We have the ‘Department of Employment’. I wonder what the one and a half million on the dole would say about that, the Industrial Reserve Army as Marx put it?

What other contenders are there? How about ‘an expanding economy’? An expression that looks a little sick in these days. How about ‘the underprivileged’: politicianese for the poor and the deprived—members of the working class in other words. But let us not forget ‘the affluent society’ (it’s been a good year for grinding the faces of the workers); ‘we have got to pay our way in the world’ (we’re going to turn the rack a few more notches); ‘nobody owes us a living’ (your tomorrow, the promised land is just over the next hill); and, to end a short selection, ‘welfare state’ (80,000 will die this year from hypothermia).

Politicians are the mouthpieces and the lackeys of the capitalist system which needs to dupe the mass of the people in order to maintain itself in power. The contrast between the humbug of political pronouncements and the struggle for survival of the working class worldwide cries out for a solution. That solution can be achieved—Socialism, which will finally make politicians redundant when it replaces capitalism across the globe.

Workers of the world unite—you have nothing to lose but your leaders.

[From the article, 'An Implement For Digging' by A. L., Socialist Standard, April 1976]

The Proletariat (The Working Class). By Karl Kautsky (1907)

From the November 1907 issue of the Socialist Standard

Link to Part 2.

Specially translated for The Socialist Party of Great Britain and approved by the Author.

5. The Industrial Reserve Army.

The introduction of the labour of women and children into industry is, as we have seen, one of the most powerful means for forcing down wages.

But at times other means have an equally powerful effect: the importation of workers from localities backward in economic development, where the population have but few wants, but possess labour-power that has not yet fallen under the ban of industrial enterprise. The development of large industrial enterprise, especially of machinery, not only makes it possible to use unskilled in place of skilled workers, but also affords the opportunity of obtaining them cheaply and quickly. Development of the methods of transit proceeds hand in hand with the development of production ; transit on a large scale develops side by side with production on a large scale, transit not only of commodities but of persons. Steamships and railways, these highly praised bearers of culture, not only carry rifles, whisky, and syphilis to the Barbarians, but they also bring the Barbarians to us and with them their barbarism. The migration of agricultural labourers into the towns is assisted by this development; and from ever greater distances swarm the persevering masses, who have but few needs and little power of resistance. Slavs, Swedes, and Italians go to Germany and drag down wages; Germans, Belgians, and Italians go to France; Slavs, Germans, Italians, Irishmen and Swedes to England and the United States; Chinamen to America and Australia, and perhaps in the not too distant future they will to Europe. On German ships Chinamen and Negroes are already taking the places of white workers.

These foreign workers are, partly, expropriated small peasants and petty bourgeois, who have been ruined and driven from hearth and home by the capitalist mode of production. Gazing at the numberless crowds of imigrants we may well ask the question whether it is Socialism that thus makes them homeless and is responsible for men and women leaving their native land.

By expropriating small peasants and petty bourgeois, by importing crowds of workers from distant countries, by the development of woman- and child-labour, by shortening the term of apprenticeship (which becomes merely a period of initiation) the capitalist mode of production effects an enormous increase in the number of workers at its disposal. Hand in hand with this increase proceeds the ever growing productivity of human labour in consequence of the uninterrupted progress in technical improvements and inventions. And not alone this, but capitalist exploitation increases also the power of utilising the labour-power of the individual to the utmost degree, partly through extending the hours of labour, but also by speeding up the workers, especially in those cases where the organisation of the workers or legislation prevents the former course being pursued.

And at the same time machinery has the effect of reducing the amount of manual labour required. Every machine displaces labour ; if that were not so there would be nothing gained in having the machine. In every industry the change from manual labour to production by machinery causes the greatest suffering among the manual workers affected, who, whether they be handicraftsmen or factory workers, become redundant, and are turned into the street. It was this effect of the machine which the workers felt first of all. The numerous instances of revolt in the first decades of the nineteenth century showed the great suffering and despair which were caused by the introduction of machinery. The introduction of machinery, and every subsequent improvement thereof, is always detrimental to the interests of certain sections of the workers : sometimes, of course, other sections may benefit—as, for instance, those employed in the engineering trade. But this knowledge will hardly be a consolation to the displaced workers faced with starvation.

The effect of the introduction of every new machine is that as much as before is produced with fewer workers, or more than before with the same number of workers. If, therefore, the number of workers employed in one country is not to diminish, in consequence of the growing development of machinery, then the market must be extended in the same proportion in which the productivity of labour increases. As, however, economic development causes at the same time the quantity of labour performed by the worker to grow and the available labour-power to increase rapidly—and much more rapidly than the population—it is necessary, if unemployment is to be avoided, that the market be extended much more rapidly than in a ratio that would merely keep pace with the growing productivity of the workers owing to the introduction of machinery.

Such a rapid expansion of the market has scarcely ever taken place under the domination of capitalist industry on a large scale, certainly never for any considerable period in a large field of capitalist industry. Hence, unemployment is a permanent feature of capitalist industry on a large scale, the one being inseparable from the other. Even at brisk periods, when the market experiences important extension and trade is flourishing, industry has not room for all the unemployed. In periods of slackness, when trade is dull, their number grows immensely. They, together with the workers of the superfluous petty undertakings, form a whole army—the Industrial Reserve Army, as Marx called it—an army of labourers always at the disposal of capital, from which the latter is always able to draw its reserves as soon as the industrial struggle shows signs of becoming animated.

The reserve army is invaluable to the capitalist. It serves him as an important weapon to keep in check the army of the employed and to make them more submissive. Since the overwork of some causes the unemployment of others, the unemployment of these latter becomes the means for sustaining and intensifying the overwork of the former. And yet in face of this fact it is asserted that we are living in the best of all possible worlds!

While the expansion of the industrial reserve army fluctuates with the fluctuations of commercial life, its general tendency is to move in an upward direction; for the technical revolution proceeds ever more rapidly, extending continually to wider spheres, but the expansion of the market on tbe contrary becomes ever more limited. We shall have occasion to refer to this point again in another connection. It suffices here to have drawn attention to it.

But what does unemployment mean ? It not only means want and misery for its victims, not only intensified slavery and exploitation for those in employment, but it means also insecurity of existence for the entire working class.

Whatever the fate of those exploited under former systems of exploitation may have been, they were certain of one thing—security of livelihood. The sustenance of the slave or the serf was assured at least so long as the existence of his master was secure. Only the ruin of his master could deprive him of his security of livelihood.

The misery or want that under any former mode of production was at times experienced by the population was not the consequence of production, but a disturbance of production through bad harvests, cattle plague, floods, invasion by hostile armies, etc.

The existence of the exploiter is not bound up with that of the exploited. The worker and his wife and children can at any moment be turned into the street, with starvation staring them in the face, without causing the slightest change in the position of the exploiter who has fattened on him.

And the misery of unemployment is to-day rarely the consequence of disturbances in production through external, overpowering influences, it is now in fact the natural consequence of production itself. Disturbances in production under present conditions often increase the opportunities for work instead of lessening them: one need only call to mind the consequences of the war in 1870 to the economic life of Germany and France during the immediately succeeding years.

Under the domination of petty enterprise the income of the worker producing on his own account grew larger the more industrious he proved to be. Laziness ruined him and caused his unemployment. To-day the longer the workers work the more unemployment increases. The worker causes his unemployment by his own work. Like many another maxim from the world of petty enterprise, the one that the worker’s good fortune depends upon his being industrious has been changed to its opposite by the large capitalist enterprise. And another maxim still mouthed to-day by many a Philistine, presumably for the benefit of the worker, has become an untruth, namely, that anyone willing to work can find work.

Just as little as a small property is a sure protection against want and misery, so is possession of labour-power. While the ghost of bankruptcy is continually hovering over the peasant owner and the handicraftsman, the ghost of unemployment haunts the wage-worker all his life. This continual insecurity is, of all the evils of the present mode of production, the most tormenting, and also the most atrocious, the evil that stirs up the feeling of the worker unspeakably and scatters completely to the winds all his conservative notions. This eternal insecurity of his own position undermines his belief in the security of the existing state of things and extinguishes his interest in its retention. And he who continually dreads the existing state of things finally loses all fear for new conditions.

The capitalist mode of production brings in its train overwork, unemployment, and dissolution of the family for the working-class, and it has at the same time the effect of forcing proletarian conditions upon further sections of Society, thus visibly making these conditions the general conditions of the great mass of the population.

Blogger's Note:

It was the German SPGBer, Hans Neumann, who translated Kautsky's writings from the German into English for the Socialist Standard.

Cooking the Books: Progress and pauperism (2023)

The Cooking the Books column from the December 2023 issue of the Socialist Standard

Elon Musk supports capitalism. Well, is the Pope a Catholic? In a tweet on 23 October he recommended a new book called The Capitalist Manifesto. ‘This book’, he tweeted, ‘is an excellent explanation of why capitalism is not just successful, but morally right’. We are not concerned here with the contents of the book, by Johan Norbert, subtitled ‘Why the Global Free Market Will Save the World’ — another time perhaps — but with a passage in the press release the publishers put out:

‘Marx and Engels were right when they observed in The Communist Manifesto that free markets had in a short time created greater prosperity and more technological innovation than all previous generations combined.’

Marx and Engels certainly made the second point, almost textually, writing:

‘The bourgeoisie, during its rule of scarce one hundred years, has created more massive and more colossal productive forces than have all preceding generations together’.

But there is nothing in the Communist Manifesto about capitalism creating ‘greater prosperity.’ On the contrary. If anything, Marx and Engels went too far in the opposite direction, ending the same section:

‘The modern labourer (…) instead of rising with the process of industry, sinks deeper and deeper below the conditions of existence of his own class. He becomes a pauper, and pauperism develops more rapidly than population and wealth’.

The complete pauperisation of the working class did not happen in the long run — at the time Marx and Engels didn’t think that capitalism was going to have a long run — but a growth in workers maintained by the Poor Law was an immediate effect of the Industrial Revolution and an accurate observation of the situation in 1848.

In exile in England in the early 1850s, Marx and Engels came to realise that they had been mistaken in believing that a working-class communist revolution had been likely in 1848. Marx settled down to studying how capitalism worked, the result being the publication of the first volume of Capital in 1867.

Nobody who has read Capital, particularly the historical parts, could claim that Marx ‘observed that free markets had … created greater prosperity’. Marx described in detail, on the basis of official government publications, the terrible working and living conditions of workers in a whole series of industries. In section 4 of chapter 25 on ‘Different Forms of the relative surplus population’, he returned to the question of ‘pauperism’.

He now no longer argued that as capitalism progressed all workers would tend to be reduced to below subsistence level, to paupers. However, he still expected that some sections of the working class would be, ‘that part of the working class which has forfeited its condition of existence (the sale of labour power), and vegetates upon public alms’; whose labour power was unsaleable because they were old, sick, disabled or industrially injured, but also because during the slump phase of the business cycle there was no demand for it.

Since capitalism needed a reserve army of labour and ‘pauperism is the hospital of the active labour-army and the dead weight of the industrial reserve army’, it ‘forms a condition of capitalist production, and of the capitalist development of wealth’.

Marx has been proved right about this. Ever since his day a section of the working class — at least 1 in 10 — has had to ‘vegetate on public alms’ (until 1948 the Poor Law, later National Assistance, then Social Security, now Universal Credit) — and will as long as capitalism lasts. Technological innovations under capitalism may have solved the problem of how to produce enough wealth for everyone but as a system it is constitutionally incapable of distributing it so that everyone’s needs are even adequately met.

The labour army wants YOU! (2023)

From the September 2023 issue of the Socialist Standard

An 1890 poem by Rudyard Kipling, Tommy, (from the slang for a soldier, Tommy Atkins), tells of the contempt held toward the working class member of the Army by the civilian population. Until that is, they were required to go off and fight some war on behalf of British capitalism. It’s reasonable to assume that economic circumstances drove a lot of Tommies into the armed forces.

Herbert Kitchener was the Secretary of State for War during the 1914-1918 one (he drowned in 1916). Initially, the armed forces were able to swell their numbers with volunteers, but as time passed and large numbers of young working-class men were being led like lambs to the slaughter on the battlefields of France and beyond it was necessary to introduce conscription in 1916. Probably Kitchener is most well known for the recruiting poster in which he stares out whilst pointing at the viewer: Kitchener Wants You!

The present Conservative Member of Parliament for Chingford and Woodford Green appears to fancy himself as another Kitchener. Iain Duncan Smith’s not exhorting the working class via a poster. He’s aiming at the industrial reserve army of labour, more specifically, those who through disabilities and sickness of various kinds are physically unable to be waged/salaried wage slaves. Smith used an Op-ed in The Sun headlined, ‘We must get thousands of people on long term sickness back into work for the sake of the economy – here’s how’.

Data from the Department of Work and Pensions analysed by the Centre for Social Justice suggests there are some 1.6 million more claimants since 2020, costing the state around £13 billion more in welfare benefits. Reducing this number by getting more people back into work will help the government find the room it needs to invest in public services and reduce the tax burden (tinyurl.com/3etumu43). What Smith wants is to lessen the tax burden for capitalists.

Smith’s predecessor in that constituency, also a Conservative, was a minister in Margaret Thatcher’s government. Norman Tebbit was, in a similar vein, fond of bashing the unemployed. Tebbit said the unemployed should get on their bikes and go look for work and get a job as his father had in the thirties.

Writing in Liverpool’s favourite tabloid, and in a very similar vein, Piers Morgan targeted ‘work-shy wastrels’: ‘Official UK unemployment numbers are at a near-record low of just under 4%. Yet staggeringly, a quarter of the people of working age – that’s over 10 million – don’t currently have a paid job. That includes students and carers, but it also includes vast numbers of people claiming to be sick and disabled and living off government handouts, or who’ve just taken early retirement. Add the enormous number of people on some form of benefits – estimated at over 5 million, many of whom are clearly gaming the easy life system – and Britain’s become a nation of shamefully unhealthy, entitled, couch potatoes. No wonder a recent poll had the UK being No1 in the world for having citizens who would most want to quit their jobs and do nothing if money was no issue.’

Note the ‘gaming’ and its inference that they are perpetuating a fraud of some kind. Has Morgan ever tried living off unemployment pay, or a basic state pension?

‘How the hell has it come to this? We’ve always been a country of ambitious and industrious grafters who’ve taken pride in putting a shift in’ (tinyurl.com/bdwdxsfu). Ha, the delusions of the well-heeled!

And there’s more! In a Bloomberg podcast, on 19 May, with Guy Hands, the billionaire chairman of a large private equity company, said, ‘I look at the UK and see that, in 2030, Poland will be wealthier than we are. In 2040, we will be the poor man in Europe’.

He opines, ‘the UK should not have left the EU, as the country needs rule of law and consistency, but not a single politician is talking about going back.’ He lamented that ‘Brexit has essentially thrown the country back 50 years, to the 1970s, a decade that is widely remembered as a time of crisis, with skyrocketing inflation, high unemployment, strikes and power cuts.’

‘Since the UK left the European Union, it has been competing on the world stage, but the country’s current laws are not suitable for the new environment.’

Now that the UK is out of the EU, the British government could take a radical approach and change some of its laws, Hands said, citing the country’s ‘extraordinarily complex’ labour laws that are a ‘nightmare’ compared to other European countries.

Nightmare labour laws! Perhaps capitalists would prefer a throwback to nineteenth century industrial relations?

We, the majority, would prefer socialism.

Dave Coggan

Sting in the Tail: Timex (1) (1993)

The Sting in the Tail column from the August 1993 issue of the Socialist Standard

Timex (1)

Another expert on capitalist enterprise has bitten the dust. He is Timex president Peter Hall. He resigned his post in June although in May he was telling The Herald that “he wasn't a quitter and he would see the dispute through to a resolution".

At that time he was full of confidence about the future of the Timex factory in Dundee:

Timex has been in Dundee for 50 years and we will he here for at least another 50 years, despite the fact that some people seem not to want us here.

Five weeks after that confident forecast he had resigned and the company announced that the factory would close in December. Just another example of the complete unpredictability of the capitalist system and the “experts'" lack of understanding it.

Timex (2)

When Timex’s owner Fred Olsen told the striking Timex workers that they should “reflect calmly” before rejecting the reduced wages and conditions they had been offered, Willie Leslie, the deputy shop stewards’ convenor, replied angrily:

How dare a man described as one of the richest multi-millionaires in the world tell workers who earned £125 a week that they need to tighten their belts to make sure . . . that the profits continue to roll into the Olsen empire. (Guardian. 5 June).

His anger was a natural reaction but does he think Timex is in business to provide jobs for workers? Its aim must be to maximize profits but the Dundee factory is a loss-maker, and as Peter Hall put it bluntly “we have to turn this place round".

Faced with the resolve of the strikers, Timex will now close the Dundee factory. Is this another defeat for the working class? Maybe, but if this dispute serves as a warning to other employers that there is a limit to what workers will endure then the struggle of the Timex strikers will not have been in vain.

Tinkerbenn

Tony Benn has in the past shown that he has grasped at least some of the Marxist analysis of capitalism.

You would never suspect this from his ridiculously idealistic waffle in the Guardian on 29 June. Writing in anger about the American missile attack on Baghdad he correctly describes this as:

a return to Victorian imperialism with its gun-boat diplomacy, carrying out punitive raids whenever the imperial power wishes to demonstrate its strength and assert its authority in defence of its economic interests in oil and the wealth of the Third World.

And his solution? He tells us “what we need is a real New World Order". No, not the abolition of the social system which produces all this hut merely “a reformed United Nations"! Its domination by the “rich nations" is to he swept away and “replaced by policies that are in accord with the Charter of the UN”.

Benn, like all reformers, really believes that with a bit of tinkering capitalism can exist without the warts which are such a fundamental part of it.

That reserve army

Will Hutton, economic editor of the Guardian, wrote on 22 June:

In the middle of the 20th century Keynesian economics came to the rescue of capitalism and dispelled the Marxist claim that to work it required a reserve army of the mass unemployed.

Marx certainly held that capitalism needed what he called an “industrial reserve army" and explained why in Capital (Volume 1, chapter 25). This army was needed to provide labour for new industries without disrupting old industries which also required it and, of course, to keep down the wages of those in work.

Hutton now cites the growth of unemployment in the EC which is expected to rise to 17 million in 1994 as evidence that Keynes's rescue “has proved only temporary" and concludes:

Thus the current spectre haunting Europe is that Marx has finally been proven right—if wrong on the solution.

Marx’s “solution" to unemployment was nothing less than the establishment of socialism and obviously Hutton doesn't agree with that.

Some celebration

Did you know that the United Nations is celebrating its first International Year for the World's Indigenous People?

Trouble is no-one told the Brazilian gold and tin “wildcat" miners. The Yanomami, an ancient Amazon tribal people, are being wiped out by the “progress" of capitalism's development.

In this column we reported in February 1990 that the Yanomami, who have lived in the area for 40,000 years, had been reduced to 20,000. We now learn (Observer, 20 June) this number is down to 7,500:

In some villages there are no surviving old people and no children under two. Gold miners have shot children out of trees calling them “monkeys”, they have raped women and bombed villages, where they want to mine.

Thus does capitalisms market system “improve" the world. Only the mining companies are celebrating such progress.

Europe’s industrial reserve army (1998)

From the February 1998 issue of the Socialist Standard

Last November the leaders of the 15 member countries of the European Union met in Luxemburg for a summit on unemployment. At the last count there were about 18 million registered unemployed in the Common Market or 11 percent of the active population.

As was to be expected nothing spectacular was decided. Led by fellow conservatives Kohl and Blair, they limited themselves to endorsing measures aimed at helping the economy recover of its own accord. The buzzwords were “flexibility” (making it easier to sack workers), “competitiveness” (not placing any extra cost burdens on employers such as shorter hours with no proportionate loss of pay) and “employability” (sending people on training courses). Not only this but a public works programme, which even pre-Keynesian governments used to resort to in times of slump, was ruled out.

Marx called the unemployed “the reserve army of labour”, as a pool of workers which employers can draw on in periods of rapid growth and send back to in times of slump and stagnation. Changes in the size of this reserve army—the level of unemployment—depend on a number of factors. The growth of the working population obviously, but also on the rate at which jobs are destroyed by the rise in productivity (resulting in the same amount being produced with less workers).

So, for unemployment to fall, the economy must grow not just faster than the growth of the working population but faster than the rise in productivity as well. As Marx put it in a talk given to German workers in 1847, ironically enough in Brussels, “the most favourable situation for the working class” under capitalism is “the most rapid possible growth of capital” in the sense that “the more rapidly the worker increases the wealth of others, the richer will be the crumbs that fall to him, the greater the number of workers that can be employed and called into existence, the more can the mass of slaves dependent on capital be increased” (Wage Labour and Capital).

This basic fact of capitalism is recognised in a discussion paper “Long-term growth potential in the EU and its relation with employment and unemployment” produced by the European Commission’s Directorate-General for Economic Affairs. According to this, the working population in the EU countries is more or less static while productivity is growing at 2 percent a year. The rate of growth since 1990, however, has only been 1.4 percent, clearly not enough to reduce the current level of unemployment.

Defining full employment as 3 percent of the working population, the paper calculates that to get unemployment down to this level from its current 11 percent within ten years would require a sustained rate of growth of between 3 and 3.5 percent in each of the coming ten years.

That this could in theory happen is not the question (such rates have been achieved in the past). The question is: how likely is it to happen in practice? The European Commission itself clearly didn’t think it likely as the paper was not presented to the summit and remains a mere departmental discussion document. And the paper itself is not very confident either as its ideas are presented as a mere possible “scenario”.

It does not even offer any reason as to why the rate of growth should suddenly and spontaneously more than double from its current 1.4 percent to the required 3-3.5 percent. It merely mentions in passing increased exports (to where?) and expresses the hope that the currency stability, which it expects the Euro to bring, will give employers the confidence to invest more than up to now.

This is all pretty flimsy. Both the logic and the history of capitalism, which is a system driven by the accumulation of capital out of profits, show that the rate of accumulation only increases as a result of a sustained period of technological innovation (such as the application of the internal combustion engine to transport or the electrification of industry) which requires the stock of capital equipment to be renewed. It has never been consumption-led.

Increased consumption has always been a consequence, never the cause, of a sustained period of economic growth. So it is no good pointing, as reformists do, to the vast unmet need for better schools, hospitals and housing and for more food and clothing for the between 10 and 15 percent of the population living on or below the poverty line. That is not relevant since capitalism as an economic system is not geared to satisfying consumption but to accumulating capital, in the form of more and more productive plant, machinery and equipment.

So there is every reason to remain sceptical and to doubt that in ten year’s time unemployment will be down to 3 percent. Those who claim otherwise are either wishful thinkers or illusion-mongers.

Adam Buick

The Great Radio Drive (1948)

From the July 1948 issue of the Socialist Standard

When an employer buys labour power the right to direct it goes with the sale. He has the last word in fixing the price, and he, or his overseers, supervise delivery of the commodity. Why, then, are the workers being subjected to a never-ending spate of propaganda for more production?

In normal times the supply of labour exceeds the demand; and the worker is always being squeezed by the overseers for that last ounce of energy. But since the war, times have not been normal. The nation’s factory gates have not been besieged by a million or two unemployed. Hence the drive for increased production along different lines.

The drive has consisted largely of appeals and straight talks over the air for individual effort. Leaflets, posters and pamphlets have been printed and distributed in millions. Few countries in the world have ever seen such a colossal effort to persuade people to work, and work harder.

The radio was used to its limit to the point of utter boredom. Economists—of the make capitalism work type—were brought to the microphone several times a week. Ministers’ appeals were reported in the news, and several hours of radio time were monopolised daily to put over the dreary propaganda of a government that had obtained power by making promises they were unable to implement.

It was obvious from the start that the main purpose was to exert pressure on the workers to increase production per man-hour. Some of the speakers emphasised the need for improved machinery and methods. In one series of broadcasts, “Management and Men,” stress was laid on the need for closer contact between managers and the lower grades. Production committees were advocated, and meetings arranged of all grades, where the firm’s plans could be explained, and their difficulties freely discussed, presumably, among other things, the need to keep costs, especially wages, low.

Sir George Schuster, who wound up the series, wanted managers, foremen and men to work as a team, as they did during the war. He entirely deprecated the notion that there were two sides in industry.

The idea of taking the workers into their confidence and seeking their co-operation is sure to meet with some response. Many would regard the move with suspicion. Others might look on it as an opportunity to ingratiate themselves with the boss. Such motives are quite common under the system. On that point read what Dr. John Murphy was reported as saying in the Sunday Express (6/6/48). His full title, by the way, is Dr. John Murphy, Emeritus Professor of Comparative Religion, Manchester University. He writes on gambling, but what he says explains the reason for much that seems incomprehensible in the relations of wage-workers. He says:

  “Gambling is the natural blossoming, true to type, of a competitive and acquisitive system of society, in which the poorer classes are struggling with each other for the means of life, and the richer are competing with each other for security and greater and greater wealth.”

Sir George may deprecate, but he cannot deny that there are two sides in industry. Otherwise to speak of capitalists and workers, as we all do, would be nonsense. Consciously, or unconsciously, he leaves out the capitalist and calls for team work between managers, foremen and men. Managers and foremen are just as much wage-workers as men. To call them salaried is no more than an appeal to vanity. What they sell to the capitalist is their ability to direct and stimulate the actual producers. Their place in the team is one of authority. They represent the owner. Their responsibility is over the production of surplus value; the reservoir of profits.

Sir George’s advice to managers, foremen and men to team up is, therefore, given on behalf of the capitalists. Managers, foremen and men are all subject to pressure from someone above them. All are liable to the sack for circumstances over which they often have no control. The capitalist has the last word in fixing their wages or salaries, and he dictates the terms.

The capitalist is no respecter of persons when buying labour-power. He naturally expects the brain worker to be more costly than the manual worker, but he takes advantage of either when the market is in his favour. The Daily Graphic (1/10/47) said: “The scientific mind, trained largely at private expense, through years at university, is today worth little more than the muscle of a stoker or the tongue of a shop- steward.” They instanced dock labourers, trawler men, garment cutters, miners, factory hands and truck drivers earning up to £15 per week; and compared them with doctors, dentists, physicists, metallurgists, chemists, designers and other technicians who, they say, "enter the labour market at five or six pounds per week after an education costing between £1,500 and £3,000.”

For those who aspire to these good jobs, so-called, the low salary is not the only snag. A paragraph in the Sunday Pictorial (6/6/48) throws some light on other business methods.

  "High premiums demanded from prospective employees are worrying the Ministry of Labour. Guarantees up to £500 are being asked from ex-officers directed to promising jobs through the Labour Exchange."

It does not follow that employers who ask for such guarantees are indulging in sharp practice. It may only be a form of barrier to protect themselves from an influx of ex-officers the government is unable to place. Ministers have been lavish in their promises, or prophecies, of the good jobs waiting for capable men of all ranks.

One speaker on the Third Programme (7/6/48) describing himself as a social statistician, argued that the pay of the black-coated workers had remained almost stationary since 1938. Taxation had hit them harder than either capitalists or manual workers, and they were almost helpless in voicing their resentment. It was they, he said, who constituted the floating vote for which Tory and Labour competed at elections. If that is true it is added proof of John Murphy's indictment of the capitalist system, and, what is perhaps still worse for the workers the readiness to vote sectionally for alleged sectional benefits as against working-class interests as a whole.

In one radio discussion (3/6/48) on the relative efficiency of British and American business methods the American speaker wound up by saying: “You point the finger at the worker all the time, but it is the management that is at fault." He charged British industry with an excessive number of directors with high salaries. Of their reluctance to instal up-to-date machinery, and their emphasis on increased production per man hour, instead of increasing the number of men on the job, with greater inducement in the shape of higher wages,

This question of increased number of workers as against increased production per man-hour is, to say the least, distasteful to big business. They object to paying four men to do the work of three, or even twenty to do the work of nineteen. If it were only a question of man-power to satisfy the needs of the people, and not one of profits, there are enough workers available in the field of commerce and finance, together with the armed forces, munition workers and a host of others engaged in tasks that add nothing to production, without mentioning the idlers who take the lion's share. There is enough man-power serving the capitalists which, if utilised in actual production would reduce by half the working time necessary for each.

Production comes first. Before men could trade, someone had to produce. All the vast machinery of exchange has been built up on production. Yet the object of production, the satisfaction of human need, takes second place in modern society. Today, the emphasis is on production per man-hour because, with the payment of less wages per unit of production, greater profits are available to each national group of capitalists to utilise in the international scramble for power.

In the past, trade has encouraged production, and the producers have responded to new demands. The two things have given us the enormous possibilities of the fuller life, that for the workers, is always just round the comer. The obstacle to that fuller life is big business—capitalism. Trade and commerce no longer contribute towards the well-being of the producers. It hampers and stops production directly profits are threatened. It has become a hard shell of class interests and privilege that constrict the social organism and prevent its emergence into that fuller life that its past struggles have made possible.

The Labour Party, pledged to make capitalism work and pave the way for socialism at the same time, have forgotten the second in face of the obstacles that have frustrated their efforts in pursuit of the first. Without a huge unemployed army they cannot drive, they can only stimulate by persuasion and utter warnings of either increased austerity or widespread unemployment. Two Labour governments have failed to make capitalism work. In 1930 because of the depression; in 1948 because there is no depression, and, therefore, no unemployed millions exercising pressure on those at work.

The Economist in May, 1947, had stated bluntly that the system could not be made to work efficiently unless there was five or six per cent, of unemployment. The Labour Party had promised full employment. The demand for labour, under the exceptional circumstances created by the war, favoured the workers if they chose to push their claims for higher wages and better conditions. They had to be side-tracked. Hence their appeals for loyalty to the Labour movement, their attempt to freeze wages, and their promise of profits-limitations they were afraid to enforce.

The government in its efforts to ginger up the workers was supported by all the big leaders in the Labour and trade union camps. They issued a monthly news sheet called "Target" which the Daily Herald (2/6/48) described as follows:

  “ 'Target,' which is backed by the T.U.C. and the F.B.I., as well as by the government, expounds in concentrated form today's supreme truth—that everything depends on production; that production depends on individual effort; and that individual effort can be greatly stimulated if every worker is given full and regular information about his task." 

Even before this the T.U.C. had already been busy in the drive. The Daily Herald (31/5/48) reported on a leaflet they had issued, in which they asked the question, “ How far do you walk after you get to work?” They discovered that quite a lot of time was wasted in fetching and carrying, which might have been to their credit if the savings had gone to wages instead of profits.

Labour M.Ps. and trade union leaders have vied with each other to get press notices about their participation in the F.B.I. and T.U.C. drive. One of the most naive was reported in the Daily Herald (10/6/48), Mr. Jack Jones:

  “Asking workers not to think of extra production as benefiting the profits of the ‘boss,' Sir . Stafford Cripps will look after that."

To the average worker the propaganda of the Labour Party has, no doubt, been confusing in the past. Today we see the Labour Party in power, and in combination with the Federation of British Industries and the Trade Union Congress engaged in the biggest drive that has ever been organised against the industrial workers of this country. Surely this is sufficient to give every serious-minded worker cause to reflect on the possibility of dispensing with all kinds of leaders and studying the cause of his incessant toil and poverty in the light of Socialist knowledge.

F. Foan

"We Must Produce Cheaper". (1918)

From the November 1918 issue of the Socialist Standard

The New "Patriotic" Stunt.

To-day, the subject of greatest interest and importance to our masters, next to the successful prosecution of the war, is how to increase production—how to reach the maximum of wealth output with the smallest possible expenditure in wages.

Much has been done during the war, by dilution and the abolition of privileges, toward this end, but the capitalist looks forward to the piping times of peace, when the supply of labour-power will exceed the demand, for a fuller realisation of his avaricious dreams.

The question as to how it will affect the workers does not concern him ; first, because he is a capitalist and therefore only interested in profits, and secondly because he keeps an army of unscrupulous journalists whose business it is to persuade the workers that whatever is beneficial to the class that own the means of wealth production, must be beneficial to society as a whole, and therefore to the working class.

To prove, however, that an increase in production, side by side with a reduced wages bill, will improve conditions for the working class, would seem an impossible task; nevertheless, the economic quack, relying on the workers' ignorance of economics, proceeds to demonstrate it. One writer who advocates shorter hours of labour as a means to increased production says that after the war—

"We shall need the greatest possible output and the most economical production, consistent with health, to enable us to get the most trade and re-establish our position and profitably employ all our people."

Other writers lay even greater stress on the last suggestion, claiming that industry is run by the capitalists as much to give employment as to obtain profits. Hence we find an economic quack measuring a capitalist's usefulness to society by the number of "hands" he employs.

It is perfectly true that the capitalists of every concern have a keen desire to employ more and more workers, but there is a proviso—markets must be assured in order that the surplus-value produced by the additional workers can be realised in profits on the same scale. For that reason only, and only in that sense, is the capitalist interested in giving employment to the workers (ignoring, of course, for the moment, his inborn antipathy to work himself). He employs the workers when by doing so he obtains profits. In the past, when new machines and methods have enabled him to increase output while at the same time reducing the number of his workers, he has never objected on the score that unemployment would be intensified. Neither has he hesitated to advertise extensively among the nations of the earth for workers with which to flood the labour market, long before the wage-slaves who were "his own countrymen" were absorbed. In short, the record of the capitalist class speaks for itself. Ever since the days when our peasant forefathers were driven off the land in order that they might be available for the forerunners of the modern capitalists in the towns, up to the present day, it has been one of the chief concerns of our masters to have a substantial margin of unemployed, and for two reasons. First, to keep down wages, and second, to be called upon in case of a sudden expansion in trade.

There is another side to the question, however. The capitalists of every land want "the greatest possible output, the most economical production, and the most trade." They know that the world market is limited, that within a certain period, say one year, the world's population can only absorb a limited amount of wealth, and that goods or wealth produced beyond this amount will be left on the owners' hands. The same applies to those goods whose owners, for some reason, fail to place them on the market at the prices ruling there. Hence the need for the most economical production, in other words, for the maximum of labour-power in exchange for a minimum wage. "Consistent with health" is capitalist irony, because the workers' health is never studied except for the purpose of increasing their productive power.

The other side peeps out in the sentence "to enable us to get the most trade." The workers of each country must submit to 'the most economical production" in order to assure to their masters "the most trade." Thus they enter into a new form of warfare against the workers of other countries in the interests of their masters. And when the capitalists of one nation succeed in obtaining the "most trade," and their workers demand higher wages, because the masters can afford to pay them, these same masters reward them with the sack, and entice the workers of other lands to fill their jobs. Where, then, do the workers of the world come in, whether they win for their masters markets or wars?

The capitalist group of every nation will point to their own prosperity as evidence that employment is good, when they deem it necessary to gloss over the unemployed army—that instrument of coercion against their workers. They boast that there is no sentiment in business, and an unemployed army is necessary to their business. In the past they have—except in a few rare instances, chiefly occupational—always been blessed with a solid margin; the future is full of promise for them, and we can rely on them to make the most of their opportunities in order to coerce the workers into the economic war.

Already in the mad race for markets we are told that—

"The old slack methods have given way to something approaching American hustle. Supervision is more strict, rest times have been reduced, furnaces are bigger and hotter, machines run faster, tools and appliances are heavier and need more strength and nerve for their manipulation, shops are more noisy and crowded, dusty and hot, materials are harder to work, labour is more fatiguing and hazardous."

But, like everything parasitic, the capitalist is insatiable. The concerns in which his capital is invested must either beat their competitors in the race for cheaper production or go under. And concerns do go under almost daily, their share of the market being taken up by their competitors, while the workers they have employed swell the unemployed army until they can be "profitably employed" by other capitalists.

Capitalist governments have for years made promises to deal with unemployment—they have even made pretence of doing something—but the evil has grown. One government gave us Labour Exchange—to find jobs for the unemployed, they said —but all these institutions did was to save the capitalist time and money in his search for the workers he needed. The latest suggestion is that hours of labour should be reduced, but those who advance it claim that a reduction in hours would result in greater production. Coming from those who plead that the workers should be more fully employed, this suggestion is a curiosity in logic.

But the richest contribution to the whole discussion has been made by the "Committee on Adult Education." They say:

"Industry exists for man, and not man for industry. The world seems to have been carried on in the opposite principle, and it will be no easy task to alter it."

Rich in irony is this utterance when we get behind the camouflage of assumed innocence, for the committee know that industry is run for their class, that they, as a class, own the nature-given material of the earth, that the dispossessed workers of the world, owning nothing but their energy, are forced by hunger to sell even that as a commodity. They know that the factory with its raw material and machinery absorbs the commodity labour-power, and out of the union comes surplus-value to be realised in profits. To them the working-class is god-given—a class to work for them while they luxuriate in idleness.

Industry will only exist for man when man controls industry, To-day the workers cannot control industry because the means of wealth-production are owned by the capitalist class, and their ownership is defended, through their Parliament, by armed forces.

Until the working-class control industry, industry will exist for the capitalist class, as it exists to-day. And the working-class can only control industry when they own the means of wealth-production. Ownership of the means of wealth-production is the basis of capitalist domination; their ownership, however, is maintained politically, and until their political power is broken, or acquired by the working-class, the latter cannot take possession of the means of wealth-production. Before industry—or production and distribution—can exist for man, therefore, the working-class must organise as a Socialist Party; second, secure control of the political machine; third, take possession of the means of wealth-production; and fourth, establish society on a Socialist basis by arranging for the democratic control of production and distribution by the whole of the people.

F. Foan