Russian Imperialism (1948)

From the April 1948 issue of the Socialist Standard

If, in 1918, the words and deeds of the Bolsheviks inside Russia stirred the imaginations of workers everywhere, so also did their abrupt reversal of foreign policy. They preached “no annexations, no indemnities," called on all workers to repudiate the aggressive policies of their governments, and demanded the ending of the war. They published the sordid treaties in which the Allied Governments had secretly agreed to dismember Turkey and divide up the rest of the spoils of war. They renounced Czarist Russia's century-old aim of controlling the Dardanelles, and voluntarily gave up the Russian “spheres of interest” in China and Persia extorted by force from governments too weak to resist. They proclaimed the right of "self-determination" and allowed Finns, Poles, Estonians, Latvians and Lithuanians to secede and become independent states. They denounced the annexations of territory and demands for reparations imposed on the defeated countries under the Versailles Treaty, and vigorously attacked the whole idea of backward peoples being exploited as colonies and protectorates by the imperialist powers. They preached internationalism, opposed militarism, and encouraged their followers in all countries to seek the reduction or abolition of armies, navies and air forces.

All of that was 30 years ago. Now Russia stands forth as a great imperialist power, armed to the teeth, trying to overtake America in atom bomb production, glorifying nationalism and militarism, and entering into the competitive struggle with the same plundering aim as the other imperialist powers.

How far Soviet Russia has departed from the earlier anti-imperialist proclamations of the Bolshevik party can be seen by comparing its present actions and attitude in foreign affairs with the views of Lenin in his work “Imperialism, the Highest Stage of Capitalism," written in 1916. (See Selected Works of Lenin, Vol. 5, Lawrence & Wishart, London, 1936.) Lenin condemned the imperialism of all the powers, but because of the Russian censorship he had to illustrate his case by avoiding reference to Russia and mentioning only Japan. Writing a year later in the 1917 Preface Lenin explained this:—"I was forced to quote as an example—Japan! The careful reader will easily substitute Russia for Japan, and Finland, Poland, Courland, the Ukraine, Khiva, Bokhara, Esthonia and other regions peopled by non-great Russians, for Korea." (1917 Preface, Collected Works, Vol. 5, p. 6.) He instanced Japanese imperialism in Korea. Now by an ironical turn of events Northern Korea is occupied, not by the Chinese from whom Japan annexed it, but by Russian troops (while Americans hold the southern half). Now also Russia has a base on Finnish territory; has annexed about a third of Poland (while Poland has compensated itself by taking territory formerly in Germany); and has incorporated the Ukraine as a Republic in the Soviet Union. Esthonia has been annexed—the vote endorsing this being taken with Russian troops in occupation; likewise Courland, part of what, between the wars, was independent Latvia. Khiva and Bokhara, conquered by Czarist Russia and reduced to vassal states in 1873 are now republics in the Soviet Union.

Lenin's statement that "the war of 1914-18 was imperialistic (that is, an annexationist, predatory, plunderous war) on the part of both sides; it was a war for the division of the world, for the partition and repartition of colonies, ‘spheres of influence' of finance—capita), etc." (1920 Preface) can as truly be applied to World War II, Russia again being one of the predatory powers, but this time with greater success than then fell to the lot of the Czarist regime. Examples in great number could be quoted showing the many regions in which the Russian expansionist drive is operating, by methods reminiscent of Russia's Czarist past and of British, Japanese and German imperialisms in their heyday.

At the Yalta Conference in 1945 and again in August, 1946 (see Daily Telegraph, August 13th, 1946, and Daily Worker, August 14th, 1946), the Russian Government revived the old Czarist demand to have a base on Turkish territory from which to control the Dardanelles. This had been preceded some months earlier by a campaign in the Russian Press for the annexation of large areas of Northern Turkey. Part of this territory had been ceded by Russia to Turkey in 1921 after a plebiscite had been taken. No one can reasonably quarrel with the Communist argument (Daily Worker, January 12th, 1946) that the vote was a farce because taken whilst Turkish troops were in occupation, but exactly the same can be said of Russia's annexation of the three Baltic Republics in 1940.

As has been mentioned it was the Bolsheviks who exposed the secret treaties of the first world war. In the second world war it was the Russian Government which had its imperialist claims embodied in a secret agreement signed by America and Britain at the Yalta Conference in 1945. As a condition of entering the war against Japan Russia was to be allowed annexations and spheres of influence at the expense not only of Japan but also of China, Russia’s ally! Under the agreement, which was made without the knowledge of the Chinese Government and was not published until a year later, Russia not only received the strategically important Kurile Islands and Southern Sakhalin, rich in timber, minerals and oil, but also received recognition of Manchuria as a Russian sphere of influence though it was Chinese territory until annexed by Japan in 1931.

The agreement was subsequently published by the British Government (Command Paper 6735, 1946). The relevant clauses read as follows: —

1. The status quo in Outer Mongolia—the Mongolian People’s Republic—shall be preserved.

2. The former rights of Russia violated by the treacherous attack of Japan in 1904 shall be restored —namely,

   (a) The southern part of Sakhalin as well as all the islands adjacent to it shall he returned to the Soviet Union.

   (b) The commercial port of Dairen shall be internationalised, the pre-eminent interests of the Soviet Union in this port be safeguarded, and the lease of Port Arthur as a naval base of the Soviet Union restored.

   (c) The Chinese Eastern railway and the South Manchurian railway, which provide an outlet to Dairen, shall be jointly operated by the establishment of a joint Soviet-Chinese company, it being understood that the pre-eminent interests of the Soviet Union shall be safeguarded and that China shall retain full sovereignty in Manchuria.

3. The Kuriles shall be handed over to the Soviet Union.

Clause 1, referring to Outer Mongolia, meant that the Government of China would be expected to confirm recognition of the independence of this formerly Chinese territory. The required recognition was given in January, 1946. Outer Mongolia, nominally independent, is now in close military and economic dependence on Russia.

The Kuriles and Sakhalin had been objects of the rival Japanese and Russian imperialists since 1875, Russia being forced to leave the former and the southern half of the latter after her defeat by Japan in 1904-5.

The granting of the Russian claim to Port Arthur is described as a “restoration"—so it was, but not to the original owners. After the Chino-Japanese war, 1894-5. Japan annexed it from China but was expelled by Russia, France and Germany on the plea that the occupation threatened the independence of Peking; in spite of which China was then forced to lease it to Russia. Dairen likewise was, under pressure, leased by China to Japan in 1915.

Members of the Chinese Government were quick to protest against the Yalta secret agreement as being “contrary to the Atlantic Charter." (Times, February 25th. 1946). and the following news, item indicates that some of the Chinese are still not prepared to accept it: —

“The Chinese People’s Political Council yesterday adopted a resolution urging the Chinese Government to demand the return to China of Port Arthur and Dairen, which have been occupied by Soviet forces since the collapse of Japan.’’ (Sunday Despatch, March 14th, 1948.)

The fact that the Yalta Agreement contained the face-saving clause about China retaining “ full sovereignty in iManchuria” deceived nobody, least of all the Chinese Government, and the following shamefaced comment was made by the London Observer (February 17th, 1946); —

“The surrender at Yalta of China’s rights in Manchuria to Russia as the price of the latter’s entry into the war on Japan was no matter for pride, whatever the gain in speeding victory . . . . the fact remains that China’s rights in a region more important to her than any disappeared. Dr. T. V. Soong obtained some modifications of the Yalta terms in the subsequent Russo-Chinese Treaty. But since then Russia has stripped Manchurian factories of machinery and still fails to withdraw her troops. Urgent diplomatic pressure in Moscow is our immediate due to China.’’

On coming to power in 1917 the Bolsheviks relinquished all the Czarist claims and rights to spheres of influence and oil concessions in Northern Iran (then known as Persia). In 1946, with Russian troops in occupation, the Iran Government was forced to agree to the re-imposition of much the same Russian privileges. The form taken by this new Bolshevik imperialism was the setting up of a joint Russian-Iran company to exploit the oilfields for 50 years, the important point being, however, that majority control would be in Russian hands for 25 years. For the next 25 years the control would nominally be equal but not until the expiry of 50 years would the Iran Government have the right to buy out the Russian half of the shares. The text of the clause relating to the first period reads: “In the course of the first 25 years of the activity of the company 49 per cent. of the shares will belong to the Iranian side, and 51 per cent. to the Soviet side . . . " (Published in “Soviet Weekly,’’ September 18th, 1947.) When Russian troops left (after complaint had been made to the United Nations) the Iran Government, backed by the American and British interests, which have their own oil concessions in other parts of Iran, repudiated the agreement with Russia. Doubtless Russia’s claim will be revived when the Russian Government considers the moment opportune.

Another example of Russian imperialism was the treaty imposed on Finland which ceded to Russia the province of Petsamo and leased “territory and waters for the establishment of a Soviet naval base in the area of Porkkala-Udd.” (News Chronicle, July 23rd, 1946.) In March, 1948, further demands were being made.

During the lifetime of the League of Nations the Russian Government never failed to point out that the so-called League of Nation's mandates were only another name for the old avowed annexations of colonial territory. When the United Nations replaced the League, and the Italian colonies came up for disposal, the Russian Government promptly made a proposal “for international control of two parts of Libya, with a Russian administrator in Tripolitania and a British or U.S. one in Cyrenaica." (Daily Worker, April 30th, 1946.) The claim was, however, not favoured by the other powers and was withdrawn.

Forgetting the early Bolshevik arguments against the stupidities and dangers of reparations, the Russian Government pressed its claim for 10,000 million dollars as reparations from Germany.

Another aspect of Russian imperialism has been the setting up of subservient governments in the countries on Russia’s borders in Eastern Europe. This was defended by Premier Stalin in a statement to the Moscow “Pravda’’ in 1946 (reproduced in the Manchester Guardian, March 14th, 1946). Speaking of the East European countries through which Germany had attacked Russia he said: “Is it to be wondered that the Soviet Union, in its desire to safeguard itself in future, is making an effort to secure in these countries governments loyal to the Soviet Union? How can one, unless one is mad, qualify these steps and aspirations of the Soviet Union as expansionist tendencies in our State? ”

It may seem a plausible argument, but it is precisely the one used by every expanding Empire as an excuse for “protecting its frontiers”; as for example by British imperialism in India and Egypt, by Japan, mid by Czarist Russia itself.

A last illustration of Russian imperialism strikingly shows the gulf that separates the outlook of the present regime from its own early proclamations. In January, 1948, the American Government published German documents, captured in 1945, which purported to disclose the secret agreements between Russia and Germany after the Pact of 1939 was signed by the two Governments. According to the Daily Herald (January 22nd, 1948) these secret agreements “ divided Eastern Europe into spheres of influence, gave the Baltic Republics to Russia and provided for the partition of Poland . . . Russia's claim to naval and military bases on the Dardanelles as part of the ‘carve up ’ . is recorded."

In 1918 in a somewhat similar situation the Bolshevik Government was able to make the most devastating of all answers, it answered the secret treaties of the Czar’s Government by renouncing them. It showed the sincerity of its protestations against imperialism by giving up all claims and by evacuating all territories seized against the wishes of the inhabitants. The Bolshevik regime was held in high esteem by workers in all countries because it could show clean hands to contrast with the loot-laden talons of all the governments powerful enough to enforce their claim to spoils.

Not so in 1948! Now the Russian protests against the imperialism of other governments have a hollow ring because the Russian Government is itself gorged with loot. Instead it had to combat the secret documents published in U.S.A. by producing a parallel volume purporting to expose the secret negotiations between the British and German Governments in 1939. “These negotiations were designed to secure a broad political agreement with Hitler, Including the division of spheres of influence throughout the world. Germany was to be given the predominant influence in South-East Europe.” (Daily Worker, February 16th, 1948.)

Unable to show by deeds that their hands are clean the Bolsheviks have perforce to fall back on the cynical plea—for that is what it means—that they are no worse than the other brigands of predatory capitalism.

And that will be the verdict of history on the melancholy decline from the idealist principles of 1918 to the sordid practice of thirty years after. 

Edgar Hardcastle

Work, You Workers, Work (1948)

From the April 1948 issue of the Socialist Standard

Bonus systems, payment by results, co-partnerships, piece work, profit sharing, all these and other schemes we have known. Each and every one has the same objective—to get a little more effort out of the workers, to encourage them to expend their utmost on the job.

Of the co-partnership and profit sharing schemes we hear little these days. Some years ago they were quite popular propositions. Probably one of the largest and most widely publicised of these schemes was the one introduced by Lever Bros, at Port Sunlight. The idea was to share a portion of the profits produced in the industry amongst the workers. This should give them an interest in the business and encourage them to serve it more zealously.

The American journal “Fortune,” which, by any stretch of the imagination, cannot be considered a working class magazine, in its December, 1947, issue, deals with this Lever profit sharing scheme and its failure. On page 204:

“But he (W. H. Lever) seemed obsessed with sharing profits. He concluded that profit sharing was fine provided it resulted in better production . . .” 

and on page 207:

“The idea of direct profit sharing continued to obsess him even after Port Sunlight was built, and he decided to make qualified employees 'co-partners' with whom he shared some of the amount available for ordinary (common) dividends. For a while his scheme worked. The dividends, however, amounted to so little per capita that their effect on production and efficiency over a long time was debatable, and the practice was discontinued after Lever died.”

For the employer it was a matter of an additional investment. The workers were induced to consider that they had an identity of interest with him. The greater the increase in profits resulting from their better production and increased efficiency, the greater would be their dividend—and the dividend of the employers. Unless the amount of increased profit to the employer was greater than the amount he paid out in dividends to his employees, then it was a bad investment for him. Also to be taken into account, of course, was the fact that the “identity of interest” idea is a fine deterrent to strikes and is a means of persuading workers to soft pedal their wage demands. Labour disputes and high wages would tend to affect profits and the co-partner would fear that he might not get a good ”divi.” In practise, the amount received by the worker was so infinitesimal, that the scheme failed in its object At least, the Lever one did.

As we have said, not much is heard of these profit sharing schemes these days and in the collapse of the Lever scheme we see the reason. But a new method has arisen to encourage the workers to foster this idea of an identity of interest with their exploiters. A cheaper method, too. It does not even require that the employer shall disgorge the small amount of wealth that the profit sharing proposition necessitated.

Listen-in at Trade Union branch meetings, Trades Council meetings and other places where workers gather to talk about their wages and conditions. You will hear some one get on his feet and trot out this kind of thing: “ Now that it is 'OUR' industry, we must moderate our demands. We must work to get it on its feet. We must increase our production and efficiency. We are all share-holders now, we must work to make the industry pay. We must not ask for too much . . .” And so on, ad infinitum, ad nauseam.

That is how it is put over today. Old man Lever allotted a portion of his dividends to get the utmost out of his workers. Today we find working class supporters and defenders of the Labour Party (they are all on the defensive now) falling over themselves to give of their damnedest without even the meagre dividend that Port Sunlight workers collected as an inducement.

If nationalised industry were engaged in producing goods or services for use, this point of view would be understandable. Then, better production and increased efficiency would result in more goods and better services for the workers themselves. But nationalised industry, as with all forms of capitalist industry, is engaged in the production of goods and services for sale with a view to a profit being made in the process. This fact is not disguised, not even by the advocates of nationalisation. The workers produce a quantity of wealth in excess of the amount they receive in the form of wages, salaries, etc. This surplus goes into State coffers and forms the fund out of which is shared the dividends to the investors in Government bonds.

True, an increase in production and efficiency in State industries does not mean an increase in the amount paid out as interests to bondholders. Neither does it mean an increase in wages. It may possibly result in an increase in the salary of the chairman of the “Board” or the “Executive," or in a fine, fat, five-figure pension to these "high” officials when they retire. It may also, by increasing the amount flowing into the State coffers, be a means of defraying national expenditure, and so help to alleviate the burden of taxation borne by the exploiting class. We know that finally it will result in an excess of commodities over and above the amount that the markets can absorb. Then we shall get from the Labour Party the same nauseating idea trotted out in slightly different words. “Sorry, fellows—an economic blizzard—tighten your belts and pull 'YOUR’ industry through.” Probably the blame will be put on to the Russians or maybe, the “Yanks,” It will be difficult for them to apportion the blame to the bankers as has been done in the past. It would sound rather puerile to tell us that it was “OUR” nationalised Bank of England that is holding up credit, or doing something or other to cause a financial and economic crisis. Anyway, it will be the workers who will be cajoled to make sacrifices to help "THEIR" industry through the difficult times. The rate of interest to the investor is guaranteed. He will not be worried. It is no longer his headache. He is the holder of “gilt edged.”

There are all sorts of things in store for the working class whilst Capitalism remains. There are no end to the reasons why they should work harder, more efficiently and be patient. Another war will make it necessary for the workers to make sacrifices to pull "THEIR” country through. After a war or after a trade depression there will be the need to produce more to recapture the foreign markets. It will always be possible to concoct some excuse for cracking the whip.

It is interesting to watch how this increased efficiency idea works out. For example, London’s nationalised transport. An agreement has recently been signed by the London Transport Executive and the Transport and General Workers Union adjusting the rates of pay of drivers and conductors of buses, coaches and trolley buses. At the same time, these contracting parties have agreed upon a letter to the effect that they will jointly recommend to the Minister of Transport that the existing rule shall be relaxed to enable eight standing passengers to be carried, instead of five as at present. This, so the letter says, is with the object of increasing the efficiency of the service to the public.

London Transport’s new 70-seat, eight feet wide trolley bus is now in operation in areas on the west Side of London. The Surrey Comet, reporting on the inaugural run of the first of these new vehicles, says (21/2/48):

"The extra width of six inches on the new buses is taken up by having the gangways four inches wider with an additional inch on each seat This should give greater comfort to the standing passenger . . .”

So better production and increased efficiency in this nationalised industry will mean that, (1) Drivers will drive bigger buses; (2) Conductors will pack in a few more passengers; (3) Passenger will be able to enjoy the increased standing comfort, or should we say more passengers will be able to enjoy the decreased discomfort, and (4) last, but by no means least, all passengers will pay their fares, thus increasing the takings per bus when the additional standing passengers are carried.

There is no advantage here that would make it advisable for the workers to moderate their demands for increased wages or better working conditions. We suggest to all workers that they should regard the State in the same way as they should regard any other employer, as an opponent who is out to get as much energy from his employees for the price that he pays, as is possible. The workers, in turn, should endeavour to get the highest price (wage) and best conditions of sale for the energy that they sell, as they possibly can. All increased efficiency should be directed to this end, and to the struggle to abolish the system of Capitalist exploitation.

To paraphrase Prime Minister Attlee :

"This year, let us all put into our struggle that spirit that will make our class free.”

W. Waters

More Funds Needed (1948)

From the April 1948 issue of the Socialist Standard

Shortage of funds is placing us in a difficulty. We have published two new pamphlets and there are more to come. Our immediate difficulty concerns the "Socialist Standard.” At present Head Office receipts are not sufficient to cover the cost of the "S.S.” We are unable to put this right by printing more copies because the paper allocation limits the number we are allowed to print. We are therefore left with only two courses of action: either to reduce the size of the "S.S.” or increase its price. We do not want to be forced to take either of these steps, but the only way this can be avoided is by an increase in the donations to the publication fund. We are not asking for any favours. The "Socialist Standard” is the only journal that genuinely represents the interests of the working class in this country, and it is therefore the duty of workers, both to themselves and to their class, to see that it is as large as the paper quota will permit and as cheap as possible. When the paper situation is easier we will add—and as widely distribute as possible.

All the money that can be spared could not be-used in a better way than making the Socialist message as adequate and as widely distributed as it can be.

We therefore urge our sympathisers to send us donations periodically and as large as they can make them to enable us to keep the "Socialist Standard” at its present size and price. If they also bring our pamphlets to the notice of their friends it will help us to recoup the cost of production of the pamphlets already printed and enable us to publish fresh ones.

We are a working-class party and therefore shortage of funds is an evil we will always have with us. It is different with our wealthy masters. The Conservative Party recently boasted that they had raised a million pounds in six months: if we could raise a thousand pounds in that time our difficulties, would vanish. They represent the present with its oppression, its laborious days, its pinching and contriving and the shadow of fresh wars; we represent the future with its promise of security, comfort and peace upon earth at last. Our work is worth all the funds the workers can supply us with.

The emancipation of the working class must be the work of the working class itself; funds are a part of the means necessary to accomplish this emancipation and they also must be provided by the working class itself.

Send us what you can as soon as you can. We are on the move; help us to keep going at the same pace.

Blogger's Note:

The two new pamphlets mentioned in the appeal were The Racial Problem: A Socialist Analysis and The Communist Manifesto and the Last 100 Years. Later in 1948 the pamphlet, Russia Since 1917, was published.

Notes by the Way: The Progress of Mr. Middleton Murry (1948)

The Notes by the Way Column from the April 1948 issue of the Socialist Standard

The Progress of Mr. Middleton Murry

Mr. Middleton Murry, who at one time claimed to be a Marxist, though his understanding of it was obviously limited, and who was in the I.L.P. before throwing himself whole-heartedly into Pacifism, has moved forward (or backward). The following is an extract from a review by Mr. Charles Davy of Murry’s “The Free Society” (Observer, March 7th, 1948):—

Many people dislike Mr. Murry’s way of displaying his inner struggles by hastening into print whenever he loses or finds a faith, and certainly this has happened rather often. But it is fair to add that his struggles are about live issues, and one reason why he embarrasses readers is that he stirs up their own doubts and conflicts.

In his new book the issue concerns democracy, Communism and war. He declares himself no longer a Pacifist, for he now believes that the “free society” will not survive unless, an international Atomic Authority is set up, and Russia must be somehow compelled, if necessary by war—the "one just war”—to accept this and come in. Otherwise an ordinary war between Russia and the free societies is sooner or later inevitable.

The Russian Workers' Standard of Living

Comparisons of the workers’ standards of living in different countries are difficult to make, particularly when, as now, the prices of some articles are controlled while other prices (in the black market or the Russian "free market”) are very high indeed. It is therefore interesting to observe that Mr. K. Zilliacus, M.P., who is certainly not prejudiced against the Russian regime, shares the view of a Times correspondent that the Russian standard is lower than that in the West. In a letter to "Forward” (March 13th, 1948) he refers to the Times article and says:—

The article goes on to point out that the Soviet leaders are fully aware that they have not yet succeeded in raising standards of living of the Soviet population to a level comparable with that of the West; that the achievements of the Soviet Union cannot be made the basis for any really European-wide "revolutionary offensive” ; and that neither a war nor an economic depression would be of advantage to the Soviet Union—on the contrary.

Having spent most of my life in studying Soviet conditions, first as Intelligence Officer with the British Military Mission in Siberia for the two years, of intervention in Russia and then as a member of the Information Section of the League of Nations Secretariat for nineteen years, charged with keeping in touch with Soviet conditions and developments, I say the Times is right.

Lord Wavell on Political Education

"The ideal is that the people shall have reached such a standard of education that it will he useless and unprofitable to lie to them at elections. We have still a long way to go to reach this ideal.”

("The Triangle of Forces in Civil Leadership.” By Field-Marshal Earl Wavell.)

 

Mr. Herbert Morrison on the New War for Democracy

In a speech at Birmingham on March 13th Mr. Herbert Morrison announced the opening of a further struggle for democracy, this time against the Russian Government and its followers: —

"Jan Masaryk’s name will live in history as the inspiration of a new resistance movement against the enslavers. Do not doubt that this movement will in time sweep across Europe.”

"I hope that as resistance develops, with the same resources and initiative and sacrifice as in the war against Hitler, a new resistance will rise against tyranny, whatever the colour of its shirt may be.”

"On top of all our economic troubles we find ourselves back in the same sort of nightmare of aggression we thought we had banished by disposing of Hitler.” (Observer, March 14th, 1948.)

It is all very well for Mr. Morrison just to make a passing reference to what he mistakenly thought would be the result of the second world war, but as he was so utterly wrong he surely ought to re-examine the notions that led him to his error. After World War I (which he opposed) he declared he would never in any circumstances support war and rejected the idea that democracy could be safeguarded by war. Has the thought never crossed his mind that perhaps he was nearer the truth then than he has been since?

He was certainly on sounder lines in his speech when he went on to say that "if we can, here in Britain, demonstrate a working model of a healthy democracy based on a healthy economic, social, and political system, the overwhelming majority of mankind will do their utmost to imitate us,” but what hope has he of achieving that result while retaining capitalism? The Labour Government will never succeed in making capitalism healthy for the workers.

Knock, Knock

In the same speech Mr. Morrison gave some advice to the workers. "The modern worker is, or should be, a responsible partner in industry and he should be knocking at the manager’s door with ideas and suggestions It is management’s job to manage and to manage better every day. But every worker as his own responsibility for pushing up production.”

The workers have already been knocking at the door, but they get only a negative reply. They want the wage increases the Labour Party led them to expect under Labour Government; but the management and Mr. Morrison say no. They say that wages must be stabilized at their present level unless there is some special reason for an increase in certain industries. Workers receiving wages far too low to enable them to live decently (like the boiler stokers, liftmen and others employed in the Houses of Parliament who had to strike to get increases in their pay which is 97/- or 91/-) are apt to be cynical when they observe the standard of living the rich shareholders, enjoy, not to mention the fat salaries paid to members of the new nationalisation boards. In the House of Commons on February 17th the Prime Minister gave a list of these. Among the receivers of £8,500, £5,000, £3,500, etc., salaries are numbers of ex-trade union officials. The issue of Hansard for that day is well worth studying. Labour Party supporters must find it hard to square with the past propaganda of their Party against inequality, and with the Government’s frenzied statements about the crisis and the need to avoid increasing personal incomes.

Nationalised Industries and Profit Making

In the Daily Mail (February 18th, 1948) Sir Eustace Missenden, the new £7,000 a year chairman of The Railway Executive, had a word to say about the running of the railways under nationalisation: —

“We intend to show that we are not going to take money out of the taxpayers' pockets. We intend to run at a profit."

It should be remembered that in order to pay their way the State railways have to make a surplus of £30 million a year to pay the 3 per cent. on the £1,000 million of Transport Stock paid to the bought-out railway stockholders.

In the same issue of the Daily Mail (February 18th, 1948) was a report that the National Coal Board was closing down the Maindy Colliery because

“it would be failing in its duty if it did not close the colliery. In December there was a loss of £1 4s. 8d. a ton."

Communist Election Tactics

After losing their deposit at Wigan, where they ran against the Labour Party candidate, the Communists hurried down to North Croydon to tell the workers they should vote for the Labour candidate. The News Chronicle (March 9th, 1948) reported the following:— 

The funniest incident so far in the North Croydon by-election was the visit of Mr. Gallacher, one of the two Communist M.P.s, in order to give a back-handed blessing to the Labour cause and instruct the local Communists (if there are any) to vote for Mr. Harold Nicolson, whom he nevertheless described with characteristic politeness as "a sap."

For political ineptitude combined with political hypocrisy this would be hard to beat. No wonder the Labour agent told Mr. Gallacher to get off the bus. Nothing could do Nioolson greater harm than the crude attentions on the spot of a few vocal Communists and “cryptos.”

It recalls their antics during the war when they supported Tory candidates, as at Lancaster in October, 1941.

“War makes strange bedfellows. A Communist deputation visited the Conservative campaign headquarters in Lancaster this afternoon and offered to work for the return of Mr. MacLean, the National Government candidate." (Daily Telegraph, October 14th, 1941.)

On that occassion they opposed the I.L.P. candidate, Mr. Fenner Brockway.

It must give the Communists great satisfaction to know that their Tory candidate, now Brigadier F. H. R. MacLean, still holds the seat!

Nationalisation in Bulgaria

While the Communist Party of Great Britain has on some occasions demanded nationalisation without compensation, Communist controlled Bulgaria, under a recent nationalisation decree, affecting all industry, is providing for some compensation. According to the Times (January 26th, 1948) "compensation is to be paid in interest-bearing State bonds, the rate of compensation diminishing as the value of the assets taken over rises."

The Roast Beef of Old England

For a long time the bulk of meat eaten in Britain has been imported. Now a new development has taken place, for the Argentine Government has entered the business of distribution here.

According to the Evening Standard (February 10th, 1948) the majority of shares of the Smithfield and Argentine Meat Co. were recently bought by the Government-controlled Buenos Aires firm, C.A.P. (Corporation Argentina de Productores de Came).

The Standard adds;—

“Since the Smithfield and Argentine organisation in this country will carry on trading in Argentine meat as before, we shall have the piquant spectacle of the Argentines drawing profits from trading in Britain— from distributing your rations, in fact."

Edgar Hardcastle

Editorial: Foreign Loans and Investments (1948)

Editorial from the April 1948 issue of the Socialist Standard 

The Communist Party's present propaganda line is that, through borrowing heavily from U.S.A., Britain is becoming a dependency of that country ; but when Russia lends to Poland for armaments and transfers “gold from her reserves to aid vital Polish economic needs" (News Chronicle, May 28th, 1946), or when Russia holds fifty per cent. of the capital of the Bank of Outer Mongolia ("Statesman’s Year Book,” 1946, p. 798), the Communists do not draw the same conclusion.

Actually the relationship of borrower and lender is not so simple and in some respects it is the lender whose freedom of action is thereby most affected as was shown between the wars when U.S.A. and Britain started the never-ending process of lending to Germany. In order to prevent the first loan being a dead loss succeeding loans have to be made. The following is a report of a speech by Mr. Lewis Douglas, U.S. Ambassador to Britain: —

"Defending the £1,100 million American loan to Britain in 1946, Mr. Douglas said that it not only upheld Britain’s standard of living, but saved the United States from 'very great and adverse effects.' If the loan had not been granted, Britain’s curtailed expenditure would have had direct effect upon America’s economy." (Manchester Guardian, January 12th, 1948.)

Naturally, American farmers, tobacco growers and film exporters do not want their British market closed or curtailed.

Lenin in his "Imperialism" (1916) quotes with apparent agreement a statement made about Britain’s development into a lending country to the effect that “ The creditor is more permanently attached to the debtor than the seller is to the buyer.” (Lenin, Selected Works, Lawrence & Wishart Edition, p. 93.)

British capitalism is now of course in the position of owing abroad far more than the greatly reduced investments abroad.

Another interesting aspect of this is the Communist argument that the workers in a country with foreign investments share, along with their masters, in the proceeds of the exploitation of the foreign workers. In the agreement forced on the Government of Iran for the grant of oil concessions to Russia (an agreement which the Iranian Government repudiated when Russian troops left), a clause provided that Russia should own a controlling interest in the joint company, i.e., 51 per cent. of the shares, should provide capital in the form of equipment and the wages of specialists and workers, and should share in the profits—"The profits made by the company will be divided in accordance with the ratio of the shares of each side.” "Soviet News," published by the Russian Embassy, September 13th. 1947.) According to the Communist argument the Russian workers would then have been participating in the exploitation of the Iranian workers.

White Papers and Black Records (1948)

From the April 1948 issue of the Socialist Standard

The White Paper on the threatened crisis should set Trade Unionists thinking hard.

Cutting out all frills, two main points emerge —Wage Pegging and Speeding Up.

As to the first point: “When it comes to a race between rising prices and personal incomes, prices will always win in the long run, so that conditions become progressively worse for the holders of all personal incomes, but particularly for Wage Earners.” (Daily Herald, February 5th, 1948.) Government apologists go so far as to use the ugly words “starvation" and “wide-spread unemployment.”

Here is a clear admission that a “Labour” Government administering its modified State Capitalism can no more prevent the evils arising for the worker than could Liberalism or Toryism.

Do you remember the ”beloved” Ramsay MacDonald? Unfortunately, the worker has such a short memory. Just to jog memories: ‘‘It is recorded on the authority of Lord Snowden that the Socialist Cabinet in 1931 unanimously approved heavier wage and salary reductions than the National Government afterwards imposed. Mr. Morrison was a member of that Cabinet." (Evening Standard, November 8th, 1935.)

The Daily Herald (February 5th, 1948) belatedly expresses in muddled terms what Marx wrote incisively 100 years ago, “Old ideas of relative value of occupations must be put aside,” adding inconsequentially, “the labourer is worthy of his hire.” This is what Marx wrote:—

‘‘Where the physique of the working class has deteriorated, the lower forms of labour, which demand great expenditure of muscle, are in general considered as skilled, compared with much more delicate forms of labour; the latter sink down to the level of unskilled labour.” (“Capital,” p. 179.)

The Daily Herald, wagging a warning finger at the pampered postman and the naughty factory lass, says with solemn air, “The relation which different personal incomes bear to one another must no longer be determined by historical development of the past.” Here a comparatively insignificant factor is raised to a position of first importance. We leave it to the psychologist to decide whether this piffle proffered to the worker arises from sheer ignorance or in more or less sub-conscious obedience to the interests; of its paymasters, or a loathsome mixture of both. The Fabian gang in the Government could at least have saved the Herald from its "economists.” Perhaps the Herald's editor, Percy Cudlipp, will find occasion to explain further on a ‘‘Brains Trust ” ; better still, the columns of the ‘‘Socialist Standard” are open to him.

The Catechism some of us were taught in our early youth solemnly counselled us to be content with that state of life into which it shall please God to call us. Substitute ‘‘Capitalist Class” for ‘‘God” and you have the true intent of wage-pegging. Sir Stafford Cripps’ fervent belief in Christianity the perfect cure for all crises is quite consistent with his mixture of frantic appeals and threats to the worker to “produce” more and ever more; Attlee and Morrison, the other two Persons of an Unholy Trinity, must find it difficult to hide their sardonic smiles.

As to the second main point of the White Paper: Speeding up is a very ancient device for the squeezing till the pips squeak of the slave, chattel or wage variety. A claim is put out that a benevolent government, oozing concern at every pore for the worker, is forced to propose measures which it believes will be of a temporary nature. Much the same sort of plea was put forward after the first World War; humbugs of the Lloyd George variety are replaced on the political stage by an astuter crowd of actors, smart Alecs who have raised the art of political thimble-rigging to the high degree demanded by a rather more politically alert working class that was so easily taken in formerly.

It is worth noting that a Party coloured with crypto-Communists has learnt something from Soviet Russia in the direction of speeding up in the mining industry. Stakhanovism is being quietly but firmly-infiltrated; the more than platonic flirtation of the Government and the Trade Unions with Miss Piece Work should open the eyes of disinterested Unionists and spur rank-and-file to action.

“Go to it” was the perfect expression of the super-driving Government foreman. How long do you propose letting these highly paid tools of plutocracy, who have climbed on your back to power, alternatively wheedle and bully you, greeting you as "heroes" when you cannon-fodder for them, and yelping the ancient insult, "Ye are idle; ye are idle," when you humbly ask for straw to make bricks for the stately homes of England? While your wife is looking old before her time engaged in a hopeless struggle to make ends meet in a “home" which lacks the most elementary essentials of comfort, let alone common decency.

The Socialist Party of Great Britain has always recognised the importance of Trade Unionism as a factor in the working-class struggle, but is only too conscious of its limitations as a weapon of emancipation. Its "bargaining" function is useful if only for keeping alive a determination not to be driven to mere serfdom. To delegates on the floor of the next T.U.C. Conference, we offer a few points for their earnest consideration: -

First of all, read this: "Mr. J. A. Hall, president of the Yorkshire Mineworkers' Association, told strikers at Hemsworth that they had stabbed him in the back, and said that Mr. Bevin was their best friend in the Cabinet. The Porter Award, with its £5 a week minimum, was the finest piece of mining legislation ever produced. Among the miners was a greedy section who were never satisfied." (News Chronicle, April 10th, 1944.) This is typical talk of the "Leaders" who will be ecstatically cheered when they deign to beam upon you from the platform, snugly ensconced behind a beautiful barbed-wire of Standing Orders.

A member of our Party wrote to the editor: "I sincerely hope there will be a big increase of "greedy miners" who fail to see how they can live anywhere near the standard of life enjoyed by their 'leaders.' I find £6 a week pension barely adequate to run a modest cottage, and make due provision for a possible widow. As one Government (ex) employee to another performing crisis-saving work, I shake hands with the "greedy miner.' "

On October 1st, 1935, at the Brighton Labour Conference, Bevin set about George Lansbury, and properly debunked the Saint of Bow. (See “Guilty Men," p. 33, by Michael Foot; Gollancz.) Is it beyond hope (alas) that one single humble delegate will do something in the direction of debunking both Hall and the Miners' Best Friend?

If space permitted, the sorry history of Trade Union "leadership" told at adequate length, would surely convince the Floor that their sickening adulation of leaders, and patient bearing of whip-cracking needed severe revision.

Just a brief indication of the kind of weapons you forge against yourselves by giving your brains in pawn to the Halls, the Lawthers, the Bevins, the Horners.

G. N. Barnes was once secretary of the A.E.U. He was Minister of Pensions during the first World War. There were 100.000 men "many who ought never to have been taken into the army, and are now physical wrecks " (Daily News, 7/3/16). Pensions were asked (Tories like Hogge warmly assenting) for these hopelessly broken tools. Barnes replied, "They will not get it while I am in office." Comment is needless.

Have you older men forgotten Trade Union Leader Hodge, who, as Minister of Labour in that war, was one of Lloyd Georges' most efficient snarling dogs? We hope your Public Library has "Workman's Cottage to Windsor Castle." Read it—take the chance if you have a delicate stomach. Just one quotation: “In the summer of 1930, Mr. John Baker was entertaining a lady friend and myself to tea on the terrace, when Lady Astor came out of the House, in that vivacious way of hers which makes other women jealous, put her arm round my neck, and said, "It's real nice to see your face again. How are you?' She peered at me and asked 'Why doesn’t MacDonald make you a peer?' 'There he is. Lady Astor,' said I, pointing to MacDonald, 'ask him!' "

Well, to quote Sterne on another sad occasion, "Shall I go on . . . No."

Augustus Snellgrove

Harry Barber and the Fortunate Thieves (1948)

A Short Story from the April 1948 issue of the Socialist Standard

Once upon a time there was a poor man named Harry Barber. Now although he could afford only the barest necessities of life Harry Barber could not understand the reason for his poverty. Men who were considered wise had told him that if he worked hard he would eventually scale the ladder of success and leave his poverty behind him.

But Harry Barber had worked hard for many years. Many things had he produced in that time— shoddy articles for the poor, specimens of exquisite workmanship for the rich. Yet, work as he may, he found that the money he received was hardly enough to buy his needs.

And looking around him he found that millions of others were in the same position as himself. With no earthly possessions these people could only sustain themselves by working for richer folk in return for sums of money just sufficient to provide food, clothing and shelter for them and their families.

And seeing these things Harry Barber was sorely troubled. Why was it that the people who produced the good things of life were the very people who could not afford to buy these things, whilst others who did no useful work lived in comfort and idleness? Why was it that although the poor produced things of great value they remained in poverty? Was it because they often experienced times in which their masters did not employ them, and during these times there was no payment for services rendered?

"No," thought Harry, "it cannot be that, for even when I am working regularly I am still poor."

Unable to find an answer to his questions Harry Barber determined to study the framework of his day- to-day existence. He listened to the words of those whom the world acclaimed as wise and knowledgable men. He read the works of economists who claimed a knowledge of the causes of poverty.

But, alas, much that he read and heard would not stand up to examination. Many of the wiseacres, for instance, told him that the workers brought poverty upon themselves by gambling, drinking, and refusing to work to their fullest Capacity. The hard-working Harry who neither drank nor gambled knew that this was not so. But from somewhere in the welter of information he discovered something that could not be dismissed from his mind as unsound—a small but insistent voice which told him of two classes in society, a master class and a wage-slave class; that the master class, although a mere handful compared with the slaves, bought the labour power of the other class; that this labour power produced a value far greater than the value and price of the labour power itself; that the master class appropriated this excess value and thus maintained for themselves a steady flow of profits.

And to Harry Barber came a glimmer of enlightenment “Now I see," he mused. “I have to sell my energy to my masters because they own the factories and workshops, and although my energy may produce mountains of wealth all that I will receive is the price of that energy—a wage. No wonder I am poor. I am robbed all the time I am producing.”

#    #    #    #

You, readers, are the Harry Barbers of the world. If you have never before read the literature of the Socialist Party of Great Britain you are now getting your first introduction to Socialist principles. Continue to read our literature and listen to our speakers. In time you will increase your Socialist knowledge, and when sufficient numbers of you can truthfully call yourselves “Socialists” there will he in your hands the power to overthrow the present social system and establish an order of society wherein the means of production and distribution are commonly owned and used in the production of everybody's requirements. When you have established this system which we know as “Socialism” there will be no unfortunate Harry Barbers on the one hand, and fortunate thieves on the other. Then, and not till then, will you be able to live happily ever after.

F. W. Hawkins

SPGB Meetings (1948)

Party News from the April 1948 issue of the Socialist Standard

Editorial: The Rise of Hitler: A Warning to the Workers (1933)

Editorial from the April 1933 issue of the Socialist Standard

The rise of Hitler to power in Germany is an event which the workers of all countries should study with care. It is not an isolated phenomenon, but part of a world-wide overflowing of discontent. It is not a coincidence that the three years since the oncoming of the crisis late in 1929 have witnessed the abrupt and sometimes violent overthrow of governments in different parts of the capitalist world. “National” Governments in the United Kingdom and many of the British Dominions; the advent of De Valera in the Irish Free State; the colossal defeat of “Prosperity” Hoover in the USA; repeated cabinet crises in France; political revolutions and counter-revolutions in South America; the Republic in Spain; political crises in Scandinavia; expulsions of leaders and reversals of policy in Russia; no country has escaped the economic consequences of a capitalist world which is seriously out of joint.

Each country has witnessed the consequent political stresses and strains of new discontents, and new slogans, which had generally brought about new political groupings and new figure-heads. The universal insurgency expresses itself in different ways according to the traditions, experience and constitutions of the various countries. A century ago such economic crises brought to a head deep underlying social conflicts and produced the revolutions of  ’30 and ’48, with their violent overthrow of kings and absolutist constitutions. Nowadays the more advanced countries have developed systems which permit easier adjustment to new pressures, avoiding the disturbance and expenses of the appeal to violence. Countries which have not travelled so far along the road of capitalist democratic government still resort to the old method of the bomb, the rifle, and the machine gun, the mass demonstration, the barricade, and the organisation of insurrection in the armed forces.

In a broad way the cause and the effect are the same everywhere. Everywhere capitalist private ownership reigns. Everywhere the rulers must serve the interests of the capitalist class, but everywhere it is an over-riding condition of social life that rulers cannot ignore the active discontent of the mass of the population. The discontent, even the open rebellion, of individuals and minorities can be bludgeoned into acquiescence, but when great masses of the population are driven by intolerable conditions into organising for common action then the rulers must sooner or later provide a safety valve; placate the movement or find means of dividing it; turn it into new directions or harness it directly to the capitalist state. In no other way can capitalism maintain itself.

Long before the war the British ruling class learned how to incorporate radical politicians and labour leaders in the parties of capitalism. The German capitalists in 1918 jettisoned the Kaiser for a similar end. Fifty per cent of the German voters had registered their disillusionment and war-weariness by voting for the reform programme of the Social Democratic Party. German capitalism thereupon “digested” the SDP and watched it stabilise German capitalism in the troubled post-war years. The military and civil associates of the Imperial Kaiser humbled themselves to the “upstart” labour leaders because they had to have someone who could control the workers and keep them loyal to the fundamentals of capitalism. So for fourteen years the Social Democrats, either in coalitions or in “friendly opposition”, worked out their policy of bargaining for reforms as price of their support. The outcome was inevitable. They have shared the fate that has always overtaken “Labour” politicians and parties when they accept responsibility for the administration of capitalism. Discontent with the effects of capitalism cannot for ever be stifled by Labour promises of better times or apologetic assurances that things might be worse. The membership and influence of the German SDP declined year by year until it had shrunk to a third of its former size. Part of the loss was picked up by the Communist Party, but in the meantime a new group had arisen, led by Hitler. At the election on March 5th he received 17,266,000 votes (43.9 per cent) and his allies, the Nationalists, received 3,132,000 (8 per cent), giving him a clear majority. The Social Democrats received 7,176,000 (18.3 per cent) and the Communists 4,845,000 (12.1 percent).

In one important respect Hitler’s Nazis are just like the Social Democrats and the Communists; they are all parties of discontent. Hitler promises work for the workless; secure government jobs in the police, the Army or the Civil service for 100,000 of his members; higher prices for agricultural products to help the peasants; and protection for the small investor and little shopkeeper squeezed by the big stores and the banks.

Immediately on taking office Hitler imposed fresh taxes on the big departmental stores and chain stores with the professed object of helping the small shopkeepers. He promised also to find posts for out-of-work professional men (doctors, lawyers and others), and it is because a relatively large number of bankers, proprietors of big stores and the more successful professional men are Jews that the party has taken on a violently anti-Jewish character. Every Jewish doctor driven out of practice, every Jewish lawyer barred from the courts, every Jewish schoolmaster and civil servant dismissed, makes another vacancy for one of his members. He was supplied with funds by German heavy industry, by armament manufacturers both in Germany and in France, and by American and other business men and financiers who had investments in Germany for which they needed protection. With the help of these funds Hitler’s party has known how to rally all kinds of discontent into a great movement representing half the electorate of Germany. Therefore Hitler has had to be “digested” as fourteen years ago were the Social Democrats. The stately and imperious Hindenburg and the aristocratic Von Papen, representing the military caste and big landowner, have had to receive on terms of equality the Austrian house-painter Adolf Hitler. Dr Hugenberg and the Nationalist Party, representing big industrial capitalists, have had to enter into coalition with him. Hitler will now have to administer capitalism. He will have to curb the demands of his followers, disappoint them, and ultimately lose many of them to new political adventurers, whereupon the capitalists and landlords who now use him will scrap him and use his successor.

The great lesson to be learned from the decline of the Social Democrats is the sterility of the policy of reforms and of reform parties. The day on which a reform party reaches power is the day on which the evil effects of capitalism begin to sap and undermine the strength of the party, turning the members’ blind loyalty first into bewilderment and then into dissatisfaction, causing them to drift into new parties.

The depths of mental bankruptcy of the reformists are shown by the comment of the Fabian New Statesman (London, March 11th, 1933). After explaining that Hitler scored because he appealed, with banners and uniforms and parades, to the electorate’s love of glamour, the German correspondent of the New Statesman says that the Social Democrats should have done the same, and should have given more prominence to pageantry and less prominence to social reforms. In other words, the workers are to be enticed, not even by the old plan of “bread and circuses”, but by circuses without the bread! This is what forty years of Fabian reformism has brought to the working-class movement!

The second lesson is one which has been entirely missed by the Labour Press in Great Britain, that is the evidence given by the Hitler episode of the overwhelming importance of controlling the political machinery. Six months ago, although the largest party in Germany, Hitler was not in control of the German Parliament and the machinery of government. He was ridiculed and derided by the members of the Government, and insulted by President Hindenburg. His party officials were hauled into court on charges of treason, and thrown into prison. Others were forced to flee the country. His newspapers were suppressed, his offices were raided by the police, his troops were forbidden to parade or wear uniforms in the street. When they attempted defiance they were driven off just like the Communists.

Now, having become possessed of the political machine and confirmed in power by the electors, he is able to turn the tables on his former opponents. He has removed the Governments of all the States of Germany. Former Cabinet Ministers have been arrested, beaten and made to suffer many indignities. Newspapers have been suppressed and their offices raided – from Conservative Catholic newspapers at one end of the scale to Social Democratic and Communist newspapers at the other. The Communists, in spite of their 5,000,000 voters and their year-long boasting of their belief in “mass action” and military revolt, have been cowed into complete submission without offering any real resistance whatever. Events are proving to them what they refused to learn. The organised political majority which controls the political machinery of the modern State is in a position to dominate, and can enforce submission on minorities. There is no road to Socialism except through the control of the machinery of government by a politically organised majority of Socialists.

Notes on Industry (1933)

From the April 1933 issue of the Socialist Standard

Profits in the Depression

As is to be expected, the average rate of profit has fallen during the “ crisis ” years since 1929. A minority of firms have made little or no profit or have suffered a loss. Most firms have made profit, although not at the rate of the earlier period. Some firms have prospered exceedingly out of the general depression.

The following table shows the up and down movement of profits since 1909. It is compiled by the “Economist" and relates (as regards the more recent years) to about 2,000 typical companies. In each case the figures are based on profits and losses declared during the 12 months from January 1st to December 31st. The figure for 1932, 5.9 per cent, on ordinary shares, shows that the investors are still doing quite comfortably: —

             PROFITS AND DIVIDENDS

	Ratio	Average	Average
	of Profits	Dividend on	Dividend on
	to Pref. &	Preference	Ordinary
	Ord. Capital	Capital	Capital
	%	%	%
1909	7.4	4.3	6.3
1910	8.2	4.5	7.0
1911	9.9	4.9	8.5
1912	... 10.2	5.2	* 8.5
1913	... 11.7	5.1	10.2
1920	... 15.2	5.0	12.6
1921	... 10.3	5.2	10.2
1922	7.0	5.2	8V4
1923	9.8	5.3	9.3
1924	... 10.3	5.4	9.8
1925	... 10.9	5.5	10.3
1926	... 11.3	5.4	11.1
1927	... 10.5	5.3	10.8
1928	... 11.1	5.4	10.6
1929	... 10.5	5.5	10.5
1930	9.8	5.7	9.5
1931	7.2	5.2	7.2
1932	5.8	4.2	5.9

(“The Economist: Commercial History and Review of 1932,” February 18th, 1932.)

The Prudent Pro

Some companies have managed to do extraordinarily well. Woolworth’s paid 70 per cent. this year and held a dinner to celebrate it. Other companies in a comparable position have been more reticent. The Prudential Assurance Co., Ltd., have just declared a dividend of 37½ per cent, tax free on their “B” shares. The original shareholder paid 4s. for these shares, and can now sell at about 55s. The “A” shares are even more interesting. Starting with 40 per cent. tax free in 1919 the dividend rose steadily year by year until it reached 94⅙ per cent. in 1928 and 1929. Then came the slump and the dividend fell to 91⅓ per cent. in 1930 and 1931, and right down to 84¼ per cent. in 1932. But hard times cannot last for ever, and this year the shareholders were able to pick up again with 92 per cent. tax free plus a special bonus of 7⅙ per cent. These shares cost originally £l, and now stand at about £26. Another insurance company, the Pearl Assurance Co., Ltd., paid a modest 50 per cent. tax free for 1932.

The Daily Telegraph (January 6th, 1933) reported the Advertising Association Research and Publicity Department as authority for the statement that 80 firms which are prominent users of advertisement showed average profits exceeding 38 per cent. on their ordinary shares in 1932. This figure is, however, probably inflated by the inclusion of a few firms which paid a very high rate of profit.

Then Lewis’s, Ltd., of Liverpool, paid 275 per cent. on their deferred ordinary shares, the same as last year. Half-a-dozen newspapers which reported on Lewis's profits and on the Prudential's profits managed to convey that they had done well without disclosing actually what the rates of dividend are.

As the Pru. advertises extensively in the Press, including the “Labour” and “ Left-wing Labour” papers, the advertising revenue probably has what is known as a sweetening effect on the editors and their staffs. As a sub-editor on a well-known sensational weekly was heard to remark, “We are allowed to attack anyone and everyone—except our advertisers.”

The Ebb and Flow of Unemployment

Owing to the scrappy way in which newspapers treat social questions, it is not easy for the reader who has no other sources of information to get a full and clear view of what is going on even when the question is one which is always being written about, e.g., unemployment.

A very common misconception is that unemployment, owing to the displacement of workers by machines and to other factors, has been steadily growing since the end of the war. This view is particularly popular with those who hold that the present crisis is essentially different from pre-war crises, and that capitalism will never recover from it. Actually the changes in the numbers of unemployed have followed the same kind of course as in pre-war crises.

The years since 1918 can be divided into a number of well-defined periods.

In 1919 and 1920 there was some “demobilisation" unemployment, followed by a period in 1920, when unemployment was at a very low level, lower than in the years before the war.

Then, in 1921, came the sudden crisis which sent unemployment up to the 2½ million level.

During 1922 and 1923 unemployment declined to a level of about 10 per cent. or 11 per cent.

From 1923 to 1929 (apart from a short period in 1926 due to the General Strike) unemployment was not increasing, but remaining fairly stable at about 10 per cent. or 1,100,000. Actually, in July, 1929, there was less unemployment than in July, 1923, in spite of a very big increase in the total number of insured workers. In other words, there were many more workers in work than there were six years earlier.

The years 1923 to 1929, which newspapers at the time habitually referred to as years of “depression" were, in fact, years of expanding production and trade, and increasing profits; Then, late in 1929, began the “crisis," with unemployment soaring up to 2½ or 3 millions, and a percentage (23 per cent.) only reached before for a short period in 1921.

The present “crisis" will eventually give place to a new period of expansion, but the fact that there were never fewer than 1,100,000 unemployed in the “boom" year 1929, shows what may be expected by the workers when prosperity returns for the capitalists. At its best, capitalism in England holds out little prospect of reducing unemployment much below 1 in 10 of the workers. That will be “normal" unemployment.

The Displacement of Workers

Closely linked up with the question of unemployment is the displacement of workers either by labour-saving machinery and methods, or by the rise of new industries and the decline of old ones. That process goes on steadily, but it does not mean (as the “Technocrats" have thought) that the number of workers employed gets steadily smaller. This can be illustrated from the course of events in this country during the years 1923 to 1932, about which the Ministry of Labour has made a special inquiry. (See Labour Gazette, November and December, 1932.)

In the first place the total population of the United Kingdom increased by 1,800,000 during those nine years, and the number of insured workers, aged 16 to 64, increased by about 15 per cent., or 1,670,000; from 11,140,000 in 1923, to 12,810,000 in 1932.

The next thing to notice is that in July, 1929, the year of maximum production just before the crisis, the number of insured workers actually in work was more than 10 per cent. greater than it was six years earlier, and it had been increasing more or less steadily in the intervening years. So that, in spite of machinery and the decline of certain big industries, there were 11 men and women actually in work, in 1929, for every 10 who were working in 1923.

How can this be explained? Some facts and figures will make the position clear.

Between 1923 and 1932 a number of industries were declining or were installing labour-saving machinery, or both, and consequently the number of workers employed was being reduced. Nearly 300.000 men were pushed out of coal mining between 1923 and 1929, and another 300,000 by 1932.

The number of non-permanent workers on the railways decreased by 60,000 in nine years, and insured workers in Government employment decreased by 46,000. Including the miners, there were about 400,000 fewer workers actually at work in the declining industries in 1929 than in 1923, and a further decline of about 1,000,000 due to the crisis between 1929 and 1932.

But while these industries were reducing their number of workers, the expanding industries were taking on far more men up to 1929 than were being displaced elsewhere. While mining was shrinking, electrical generation and the manufacture of electrical machinery was rapidly growing. Artificial silk was replacing cotton. Motor transport was replacing railway transport. While the staffs of the Central Government were being reduced, the Local Authorities were taking on more men.

Dividing all industries and transport services into the declining group and the expanding group, we find that while the declining group got rid of about 400,000 workers between 1923 and 1929, the expanding group of industries and services increased the number of workers actually in their employment by 1,400,000—a net increase of 1,000,000 for insured trades as a whole.

Since 1929 the crisis has thrown another one million men out of employment in the declining trades, but the expanding group have still managed to increase, although only very slowly. As remarked above, for the whole group of insured trades, the number in work in 1932 and now is still about the same as in 1923, in spite of the heavy fall in employment since 1929, and, after making all due allowance for any increase since 1923 in the number of unemployed not on the register.

It is interesting to notice that while mining and many manufacturing trades have been badly hit, the distributive trades have increased enormously, from 1,100,000 workers in 1923, to 1,700,000 in 1932.

The National Income

Mr. Colin Clarke, M.A., has made estimates of the amount and distribution of the National Income in the years 1924—1931. ("The National Income." Pub. MacMillan, 1932. 8s. 6d.)

He shows (p. 72) that the National Income (including net income from Overseas) increased from £3,586 millions in 1924, to £4,006 millions in 1929, these being years of expanding production and trade.

He estimates that the wage earners receive about two-fifths of the total national income (39.9 per cent, in 1929).

On the assumption that the average family consists of, roughly, man, wife and two children, he estimates that the national income, if equally divided, would have been sufficient in 1929 to provide £349 per family, or £6 14s. per week. (P. 78.) If an amount were deducted to provide for the existing rate of new capital, and excluding income from overseas, the figure would be about £310 per family in 1929, or just under £6 a week.

Edgar Hardcastle