Myths about capitalism (1981)

From the March 1981 issue of the Socialist Standard

MYTH 1

That in all societies wealth must take the form of commodities.

It is argued that all goods and services must be produced for sale, as if the different values of various goods and services are inherent. Need-fulfilling wealth is seen in a fetishised way, as if its expression in terms of exchange value is a manifestation of its natural essence. In fact, value is a social relationship between people. wealth only takes the form of commodities when the system of production and distribution is based upon the class ownership and control of productive machinery. Buying and selling is only possible when there is privately possessed wealth to be exchanged. In a socialist society, where there will be common ownership and democratic control of the means and instruments of wealth production and distribution, goods and services will be the property of the whole community, and it is obvious that the community will not be able to sell back to itself that which it already owns. So, in socialism there will be use value (the production of wealth to provide for human needs), but no more exchange value (the sale of commodities with a view to profit).

MYTH 2

That the capitalists' profit is made in the market place.

It is a popular fallacy that workers are paid a price for their labour power which is equivalent to the value of what they produce. Then, the capitalist takes the commodity to the market place (any retail or wholesale outlet) and sells it at a price which is above what it had cost him to produce the commodity. According to this explanation of how profits arise, profit is the difference between the cost of production and the market price. Now, it is true that under special circumstances capitalists do sell their commodities for prices which are considerably above their value, but the Marxist case is that, on average, commodities sell at around their value. So how is the profit made? The profit is taken from the surplus labour of the workers at the point of production, the workers are paid less than the value of what they produce. Profit arises, therefore, from the exploitation of the working class, although it can only be realised when commodities are sold. So, the capitalist can still make a profit by selling his wares at their value.

MYTH 3

That prices reflect demand.

Prices reflect market demand—the money available to back up a need, but not real demand, or human needs. Supply and demand do affect price (which is the monetary expression of value), but do not determine it. A homeless family may demand that society give them a house, but in terms of capitalist economics, if their need cannot be backed up with money ('effective demand') they will remain homeless. Under capitalism, if you are rich you can afford to fulfill needs that you never knew you had; if you are poor you are limited in your access to the necessities of life.

MYTH 4

That capitalism causes problems because the capitalists want it to.

The operation of the capitalist economy overrides the wills of individuals within it. However wicked or altruistic, intelligent or stupid the capitalists may be, they must exploit their employees of they will not get their profit and will have to join the working class. Governments may have fine ideas—or nasty ideas—about how the economy should be run, but the capitalist economy will obey its own laws, not their. Workers can be as militant and radical as they wish, but unless they abolish the system they must be its slaves. Capitalists and workers may dance round the May Pole with each other every night after work, but still the class war will not cease, for the material interests of the two classes must always be antagonistic.

MYTH 5

That in a socialist society profits will be for the benefit of all.

This is the standard justification for the economies of the state capitalist countries, such as the Russian Empire, China, Albania, Cuba. It is based on the pernicious lie that the interests of the state bureaucracies who control the productive machinery in these countries are the same as the toilers who must work for wages. Profits can only result from the exploitation of the majority by the minority. When production is for use there will be no value, price or profit.

Steve Coleman

Doctor Smith operates (1993)

Editorial from the March 1993 issue of the Socialist Standard

As Leaders go John Smith is something of a novelty. He did not campaign for the leadership as the darling of the left and then outrage his supporters by revealing himself as a man of the right.

His appeal was of a different kind. He studiously avoided any ideological commitment apart from vague phrases about a juster and more caring society. His promise was to be a shrewd and prudent managing director for British Capitalism plc. The implication was clear. This is a man you can trust. He will look after you like your family doctor. After the hysterical abrasive raving of Neil Kinnock some Labour supporters might have found relief in John Smith's more comforting message.

It was all of a piece, that Smith's election to the Labour leadership should be so blatantly and determinedly stage-managed. There was in fact no contest worth the name. It was a fix-up. Punch-drunk though they were over their fourth consecutive election defeat, some Labour Party members still had enough energy to have doubts about Smith's leadership and about how he got the job.

So it should have surprised nobody, when Smith declared that nothing would be exempt from his desire to revise Labour's policies. What Labour used to regard as its principles no longer exist. Everything they say and do must conform to two standards of judgement: Os it in the interest of British capitalism? Does it win or lose votes?

If this means disregarding everything the party has stood for, so be it. If it means an open admission that Labour is the Tory Party with a different emblem and different coloured rosettes, that is a price worth paying. If it means losing a few voters who believed however half-heartedly that Labour stood for a different social system—well, what party aiming at power over British capitalism needs such thorns in its electoral side anyway?

What Smith is doing is but the latest episode in Labour's drive to become a natural party of government whose only principle is to get into power. At times they have justified this on the grounds that they will run capitalism more efficiently and more humanely than the Tories. Smith has made it clear that even that excuse can no longer be used.

So what about all those people who want to contribute to the establishment of a new and better society and who have worked and voted for the Labour Party in the belief that this would bring it nearer? Many of them must be in despair, bitter and angry at what they see as the betrayal of their party.

But it need not be all loss. A society of common ownership, democratic control and production for need not profit remains worths struggling for. To do this people need to organise politically—not in the Labour Party. Labour has never been a socialist organisation and now more than ever is unworthy of anything other than working class hostility and contempt.

What is needed is a party that stands for socialism and which sticks to its socialist principles. We consider our record over the years shows us to be such a party. If you want socialism your place is in the Socialist Party.

Guru on the spot (1984)

From the May 1984 issue of the Socialist Standard

Roger Scruton arrived early to debate with the SPGB in Guildford. The debate wasn't due to start till 8pm, so one of the members suggested I take him to the pub across the road for a drink.

He ordered Irish Whisky and we started to talk. I was interested to see the human side of a man I only knew from difficult-to-read books on politics and philosophy, a highly reactionary weekly column in the Times and highbrow discussion programmes on radio and television. I'd read in the press that he was arrogant, conceited and intolerant. I found him modest and likeable and the more we chatted the less accurate the press descriptions seemed to be. I asked what had made him accept our challenge to debate and he said that he thought that opinionated people like himself should be called on to defend their opinions in public.

He hadn't made any detailed preparation for the debate and asked me if I'd tell him about the Socialist Party and what my arguments were going to be. I did, and he admitted that it wasn't what he'd expected. He said he'd make a few notes to speak from and did this while I went to the bar for more drinks. As we walked back to the hall he said he thought he'd got the message about the Socialist Party, but wouldn't a fully democratic socialist society be an impractical proposition because of the time and effort involved in people voting democratically on absolutely everything? I told him that everyone wouldn't have to vote on everything but only on those things that directly concerned them.

The swirling rain made me think we wouldn't have much of an audience. And when we entered the hall, there were about fifty—fewer people than could have been expected for a meeting with a "celebrity".

Scruton was introduced by the chairman as a leading conservative philosopher and editor of the Salisbury Review. He was answering no to the question: "Is Socialism Compatible With Freedom?" He opened with a joke—a funny one. He said he understood that the Socialist Party no more supported the countries that called themselves "socialist" than those which are openly capitalist, and this reminded him of an old, East European joke: "Under capitalism man exploits man; under socialism it's quite the other way round".

On the subject of freedom he started off on a tack that he said would probably seem unusual. He talked about love. He said that love between two people placed limitations on their freedom but that nobody would say that this was a bad thing because they were limitations that had been freely chosen and desired. In the same way, he went on, capitalist society limited people's freedom in some areas but this was with their consent. They consented to it because they realised that these limitations—those involved in wage labour—were necessary in order to be able to enjoy the other freedoms and choices that capitalism gave them. Capitalism he claimed, with its markets, wage labour and money system, gave the maximum freedom available, and gave far more of it than previous societies such as feudalism.

He spoke fluently along these lines from the sparse notes he'd made in the pub, showed an accurate knowledge of Marxist ideas, and ended by stating that if socialists thought a different kind of society could be more free that the present one, then the onus was on them to describe and define it. But the "facts of human nature", he insisted, were on his side and all attempts so far to put socialism into effect had, far from increasing people's freedom, ended up restricting it.

This last point, I felt, was one below the belt as Scruton had earlier recognised and accepted the Socialist Party's description of countries like Russia, China and Cuba as not socialist but state capitalist. I began, therefore, by pointing out that Scruton couldn't reasonably damn the idea of socialism because of what had happened under state capitalism and because the state capitalist rulers happened to call their regimes socialist. I pointed to the openly repressive features of such regimes—one-party rule, political prisoners, press censorship, state-run trade unions—and agreed that by comparison countries like Britain, the USA, Germany and Japan appeared to enjoy considerable freedom. But, despite appearances, they did restrict personal freedom in an absolutely fundamental way—in operating the system of employment.

This meant that most people were bound for most of their lives to a set place of residence, set living conditions and a set job—whether they liked it or not. The job they did was not necessarily one they found pleasant or satisfying but one they needed to do to have money to live. The employment system was shared by countries on both sides of the Iron Curtain. So in both East and West people were denied freedom by needing to work for wages or salaries and therefore by not having control over what they did with their own lives.

Despite his lack of preparation Scruton had timed his contribution to exactly the agreed twenty minutes. Looking at my watch I realised that I'd have to rush if I didn't want to run over. The chairman had already started putting slips of paper in front of me. I breathlessly tried to take up Scruton's challenge to describe and define a freer society than capitalism. It was clear, I said, that enough resources now existed potentially to satisfy people's needs the world over if production of goods and services could take place directly for need and not for sale and profit. This was the basis of the "freer society: Scruton wanted defined. It would be a worldwide moneyless system of free access—"the supermarket without the bottleneck at the cash desk". And the shelves of the supermarket would be kept full by the voluntary co-operative work of people for whom work would not be compulsory toil for money but conscious, freely chosen activity to satisfy their own needs and those of society as a whole. In a society of common ownership and democratic control no one would be able to compel others to do work in conditions they found unacceptable. In this society people would value work, as they often value leisure today, for the creative or pleasurable activity it represents, not for the money it earns them. I sat down just as the chairman was about to make me.

The question time was interesting. Scruton, although he didn't say so, must have been surprised by the friendly atmosphere and the cordiality of the audience. Any visions he'd had of meeting wild lefties must have been completely dispelled as contributors from the floor addressed him without hostility and with a clear desire to exchange ideas. It was he who became heated when it was put to him that rather than compare the amount of freedom in capitalism to the amount in feudalism, he should be comparing capitalist freedom to the kind of freedom there could be in a future society—socialism—where modern technology could be maintained and used but in a quite different setting. Scruton, argued the questioner, had presented no solid theory of "human nature" to show that such a society was not possible. Scruton went a bit wild, said the debate had been forced on him and referred to my own description of what socialism would be like as "a lot of air". My reply to this was that he lacked imagination in not wanting to contemplate anything beyond the narrow confines of present reality.

He soon cooled down as more questions came from both socialists and non-socialists in the audience. One was about whether you could organise society without leaders. I said you could. Scruton said that "little points control" would always develop and that seeking power over others was fundamental to human nature. Another question was about how in a society of free access people would be able to distinguish between "need and greed". Scruton thought they would not. I argued that people were quite capable of responsibly determining their own needs of they didn't live in conditions of rationing and scarcity as they did in capitalism where they were rationed by their wage packet.

At the end we had five minutes each to sum up. Again I tried to say too much and had to rush. My thrust was that at one time in history people (Greeks and Romans) had used intellectually sophisticated arguments to assert that chattel slavery was inevitable and eternal. Aristotle had said that it was a fundamental feature of civilised life. Scruton, I went on, was using the same kind of arguments to defend a different kind of slavery, but slavery nonetheless—wage slavery. Historically wage slavery was no more inevitable or eternal than chattel slavery had been and when the majority of people wanted to get rid of it and bring in a non-slave society in which no man or woman was subordinate to any other, they would do so. Then we would have socialism.

Scruton would up by stating that he was the only one who'd taken account of history, for the whole of history gave evidence that people sought power over others. For socialism to be set up fundamental human desires would have to be abolished. He said that the discussion had, however, been a "most instructive" one. He denied there was any proof that the pursuit of profit on the part of the few was a limitation on the freedom of the many and concluded by stating that he had not, that evening, heard a formula for what everyone, himself included, would like to achieve but what was unachievable—freedom from necessity.

He told me he'd enjoyed the occasion and asked if I could try to get the library of the institution I'd told him I was a teacher in to subscribe to his Salisbury Review. "A serious journal:, he called it. I promised I'd have a go.

As we left the hall he was approached by an excited gentleman who'd been taking photographs during the meeting and who, as I read later in a cutting sent me from a Guildford paper, was a local Greek-Cypriot businessman complaining about a pro-Turkish article on Cyprus which Scruton had written in the Times.

Over in the pub Scruton eased himself away from Mr Demosthenous only to be taxed by a very hairy teenaged socialist on the subject of pre-capitalist societies—tribal ones—which had operated with far greater freedom than capitalism on a basis of common ownership and democratic participation. Didn't this show that human beings weren't naturally power-seeking or grasping? Scruton must have been a bit nonplussed by an articulate argument from what he thought was an unlikely source because he didn't put up much resistance.

As I left I asked him if he thought private property itself was fundamental to human nature. He said he did and that he'd argued the point "very rudely" in one of his books. I felt like saying that the point got argued very frequently and very rudely too by visitors at my local branch meetings but that, despite his learning and sophistication, his arguments for it had been no more convincing than theirs. All the evidence, I said to myself as he vanished out the door, was in the other direction. But then he had taken a Socialist Standard away with him and if he read it maybe he'd find some of that evidence there. Come to think of it, maybe I should have asked him to subscribe to the Standard? After all my library's now agreed to take the Salisbury Review.

Howard Moss