From the July 2010 issue of the Socialist Standard
The aspirations of the majority of the world’s population are being frustrated by capitalism’s economic constraints.
In May 2010, the Coalition government in the UK announced cuts of £6.2 billion in an attempt to begin to reduce the budget deficit of £156 billion for 2009/2010. These cuts will very noticeably affect people’s lives. For example, it was reported that £780 million would be cut on transport, £836 million on communities and local government and £325 million on education. Devolved administrations in Scotland, Wales and Northern Ireland will have to cut back £704 million. Local authorities will be expected to reduce expenditure by £1.165 billion. Many more expenditure reductions were announced in the June emergency budget.
It is vital to realise that this economic crisis is just the latest in a series of slumps which are quite natural to the capitalist system. In the past, supporters of this system have quite mistakenly believed that politicians would be able to rid society of the detrimental effects of the trade cycle. Gordon Brown is particularly infamous for his claims to have “abolished boom and bust”. Past slumps have, of course included the Great Depression of the early 1930s, and recessions of the mid 1970s, the early 1980s and 1990s.
Reforms = Continuation of Capitalism
When confronted with the case for genuine socialism, many apologists for the capitalist monstrosity have maintained that through the introduction of reforms, political leaders would be able to establish a “fairer” and “better” society.
Let’s look at aspects of this reform movement. In 1942, the Social Insurance and Allied Services were created by Beveridge in order to aid those who were in need of help, and/or in poverty. The benefits were designed to aid the sick, unemployed, retired or widowed. When state welfare reforms were introduced after the Second World War, they did produce some improvement in working class living conditions in the UK, for example in the areas of education, housing, child employment, work conditions and social security. No doubt, one motive for these reforms was an attempt to distract workers attention way from more radical, left-wing ideas, which claimed to offer an alternative to capitalism. Such motives had been employed in Germany during the 1890s by Bismarck.
The benefits from reforms have, in reality done little more than to keep workers and their families in an efficient condition for employment. In economically developed countries, such as those in Europe and North America, whilst the worst excesses of poverty have been partially alleviated, most of the social problems of inequality, unemployment (or the threat of it), sub-standard housing etc., remain.
The reforms which are made in capitalist society, have to be reconciled with the profit-making needs of the system. These reforms will often be turned to the benefit of the capitalist class at the expense of any working class gain. This explains the limited nature of reformism as far as the workers (the majority of people) are concerned, and how many of the supposed benefits can be eroded. Take for example social security, housing and education.
Underlying the whole system of the provision of “benefit” to those unable, for various reasons, to take part in the employment process, is the suspicion, encouraged by the ruling class, that many of those in receipt of these benefits “may not deserve them”. The value of the benefits, such as Job Seekers’ Allowance, Income Support and state pensions frequently declines over periods of time, since the government insists that the previous levels “cannot be afforded”. Pressure is put upon claimants to “justify” their claims.
As regards social housing, council house building is a minute fraction of what it was 50 or 60 years ago and the cost of having a roof over one’s head has become much greater, causing through mortgages, huge levels of indebtedness.
In the sphere of education, tuition fees and student loans have put enormous pressure on the young who are seeking to increase their knowledge and skills, in most cases, in order to make themselves “more employable on the job market”. According to the online student magazine Push, in 2009 students faced an average debt of £5,000 for each year of study. Some students in London have debts of around £30,000 by the time they finished their courses. When these students do finish their studies, they will most likely have to find a place to live, on a more permanent basis. Hence, the need for majority to take out a mortgage and build up even more debt for themselves. How much of this was foreseen by the reformist proponents of large-scale higher education and home “ownership” under capitalism?
It’s the Working Class who make the sacrifices
Most economists and political commentators are saying that the UK’s budget deficit and indebtedness will usher in a period of significant austerity. This problem is a global one, as is the economic crisis. To take just one example, the problems of Greece have been well publicised. In order to receive loans from the Euro-zone countries and the International Monetary Fund, wage freezes, pension cuts and tax rises are being introduced.
David Cameron and other apologists for the status quo claim that the whole population will have to make “sacrifices”. What these defenders of capitalism utterly and deliberately fail to tell us is that the overwhelming burden of the sacrifice will have to be made by the working class. The rich will, for the most part, as usual keep their privileges and luxurious lifestyles. Perhaps, the average multi-millionaire or billionaire will only be able to “afford” two yachts in the Caribbean, instead of the more normal, three. Perhaps, some of the wealthy will have to delay refurbishment of their opulent gated homes, for a few months etc. The reality is that capitalism can never be made to work in any other way. It always works in the interests of the rich minority and against the interests of the majority of the population, no matter how many reforms are introduced.
The socialist answer to all this is firstly to point to the absurd contradictions which capitalism presents. We are being told that many reforms and much social expenditure cannot be afforded. Yet, huge sums of money are squandered on the destructiveness of the armed forces and on the wastefulness of financial services. The society in which we live, possesses immense wealth, on a global scale. Just think of the power of modern technology, compared with the technology of only 40 years ago. Just think of how greatly the processes of automation in industry have been developed in recent decades. Also, bear in mind the huge potential of the world’s labour force which could contribute towards expanding society’s wealth still further. However, under capitalism many of these productive resources are being and will be underused or abandoned since they cannot be “afforded” (in reality, it is not profitable to employ them). All the reforming of the capitalist monstrosity is not going to make any significant difference. The problem will still be there, unless…, unless people finally realise that there most certainly is an alternative to this austerity madness.
The Socialist Alternative
That alternative consists firstly of people becoming aware that conditions most certainly do not have to be as they are at present. The majority needs to come together and to realise that instead of a small, profiteering minority owning nearly all of the planet and its resources, we, as the overwhelming majority must take possession of those resources, manage and use them in the interests of the whole of humanity, with production of goods and services for human need and, not for profit making which benefits only a small minority.
In such a society where the resources of the world are owned and controlled by the people of the world, there will be absolutely no need for the money system and its inherent enormously wasteful financial apparatus. With the democratic introduction of common ownership, will come the abolition of money and all forms of exchange. In their place, each individual will be able to make their own voluntary contribution to the production of society’s wealth and in turn, will be able to draw from the common store, according to their own self-defined needs.
In such a world, notions of “indebtedness” and not “being able to afford” things in monetary terms, will be considered completely archaic and utterly out of place.
Through the pages of this journal and of other socialist literature, and by communicating with socialists, people can become aware of this alternative. So, the next time you hear a politician supporting policies of austerity and talking about there not being enough money to do something worthwhile, think of the socialist alternative where we will not need money in the first place. Instead, the world’s people will be empowered to contribute their knowledge and skills to the common good (that of society as a whole, including themselves, as individuals). In such a system, humanity will also have, at its disposal, technology designed and frequently refined to benefit all of the world’s people.
Vincent Otter
