Friday, February 20, 2015

How the Rich Become Richer (2015)

From the February 2015 issue of the Socialist Standard

On most accounts Bill Gates is the richest person in the world but, according to Bloomberg Markets, it is a rather less well-known individual who saw the biggest increase in his wealth in 2014. This was Jack Ma, founder and Chief Executive Officer of Alibaba, a Chinese e-commerce business. His fortune is just short of $26bn, up over $22bn in a year. You might wonder how anyone could earn that much in just twelve months through their own labour, but of course Ma did not make this money through his own abilities; he cannot even write computer programs.

In September, Alibaba Group Holding sold shares to outsiders for the first time in its initial public offering (IPO) on the New York Stock Exchange, raising a record $25bn. Ma owns a good chunk of the shares, and it was this that led to his fabulous increase in wealth, making him the richest person in China. The company is attractive to other members of the mega-rich super-elite too, and Alisher Usmanov, the richest man in Russia, has a substantial stake in it. Usmanov (who also owns a large part of Arsenal Football Club) is pretty secretive about his financial affairs and does not disclose how many shares he owns, but he has apparently sold his stake in Facebook in order to invest in technology companies, especially in India and China.

Now, Alibaba Group Holding is not quite the same as Alibaba in China. Ma and another executive, Simon Xie, own most of the Chinese assets, and Alibaba Group Holding is a Cayman Islands shell which has contractual rights to the profits of the Chinese company. It is what is called a variable interest entity structure (VIE), a way to get around restrictions in China on foreign investment in certain industries ( There are arguments as to whether such arrangements are strictly legal under Chinese law, and anyone buying at the IPO is taking a fair amount of risk. Yahoo, which owns around a fifth of Alibaba's shares, complained previously that the VIE was a way of moving assets to put them under Ma's control.

So what does Alibaba actually do? It is a striking example of the extent of globalisation, since its customers are not just in China, and in a sense it combines the functions of eBay, Amazon and PayPal, as it incorporates a number of businesses that do slightly different things. is a platform for businesses to sell to the public, while is for business-to-business sales (described on its website as ‘the leading platform for global wholesale trade’). There are financial subsidiaries that deal with lending and other financial services, and a telecom company too. The company has also bought a sizeable chunk of other firms, including the Chinese equivalents of Twitter and YouTube, and the Guangzhou Evergrande Football Club.

It has even managed to market its own version of Black Friday, known as Singles Day, on 11 November. On this day in 2014 it sold well over $9bn worth of discounted goods to online shoppers in China and abroad (an increase of over a half compared to 2013). It has copyrighted the term ‘Double 11’, though many think this is unlikely to become a major shopping day in Europe as it coincides with Armistice Day. But who can really be sure that commercial considerations will not outweigh commemoration of the war dead?  

Alibaba has around 26,000 employees at its ‘campus’ in Hangzhou. But in addition China has a number of ‘Taobao Villages’ ( being the customer-to-customer part of Alibaba). People in these have set up online shops to buy and sell almost anything via Taobao. This is related to the fact that, outside the big cities, most people in China live a very long way from a major retail centre and so are less able to shop in person. Many such online shops now have a split between owners and employees too, so are not purely for sales between individuals.

In a recent letter to his workers, Ma wrote of ‘unparalleled ruthlessness and pressure ahead’ (Beijing Review  9 October). No doubt the ruthlessness will be his and the pressure will be on those who labour to produce his profits. 
Paul Bennett

Uniformity & Convenience (1972)

Book Review from the August 1972 issue of the Socialist Standard

Technological Eating, by Magnus Pyke (John Murray £2.50)

Ever since capitalism became, towards the end of the nineteenth century, the dominant world economic system it has fashioned the world in its own image. Local traditions and culture have, in the main, been unable to withstand the onslaught of the money/commodity system. Backed by technological. economic and military superiority the developed nations of Europe and North America have imposed their values and traditions upon 'primitive' communities. Mass production methods needing standardisation and uniformity of product and production method have led to a depressing uniformity of world working class lifestyles. Scientific technology has de-tribalised society. Coca-Cola culture has triumphed.

In this short, very readable, book Professor Pyke argues that the areas in which technological developments have had the greatest impact on our everyday lives have been those relating to food—what we eat and how and when we eat it. This aspect of social experience and behaviour has been and will continue to be influenced by evolutions in food technology. "Food plays a central part in social life and the rapid progress of food technology in exercising a more profound influence on the social scene than has so far been recognised". The book develops this theme showing how in a modern industrial society different parts of the world grow more and more alike.

Having destroyed the tribal communist societies of West Africa in the search for raw materials, in this case palm oil which through the process of hydrogenation could be used for making margarine, capitalism replaced it with the plantation system introducing money values and drawing the local inhabitants into the world economy. Financial empires were built up out of what had formerly been jungle. Refrigeration techniques enabled the United Fruit Company to exploit tropical plants such as the banana on a massive scale "not primarily for the benefit of the citizens of the area but for entirely separate social groups, United States businessmen".

In the metropolitan countries the same technology, put to the same purpose, brought about the retail revolution which converted the shopkeeper craftsman into a wage worker in a supermarket. This new method of shopping is more impersonal, less of an occasion for social contact and discussion—more like a factory in fact. The author looks forward to the possible eventual superseding of the supermarket by the "Cash and Carry" depot possibly delivering food for the winter to the family deep freezer. The less well off members of society presumably having to rely on the few remaining small "corner shops".

New products appear on supermarket shelves at the rate of one a week. The successful ones being those which most satisfactorily fulfill an already existing need. Thus breakfast cereals such as cornflakes, developed by Seventh Day Adventists as a "morally neutral" food, transformed breakfast from being a major meal of the day into one which each member of a family can partake individually in their own time.

The whole range of "convenience foods" which can be prepared quickly and with a minimum of fuss, frees a large section of the population (mainly women) to do other things. In the money dominated society of buying and selling this tends to be going out to work to get the money to buy the refrigerators or deep freezers in which to store the frozen convenience foods. This tendency is likely to grow. The changing needs of capital will make mincemeat of old, trusted and respected institutions such as the family.

In perhaps the most provocative chapter in the book—entitled "The Disappearance of Mealtimes"—the author argues that the shared family meal is under great pressure. Already large numbers of children eat the main meal of the day in school dining rooms as their parents eat theirs in office or factory canteens. As parents are forced by social and economic pressures to go out to work, and as food technology increasingly makes it possible for children to eat without having to go home then the fabric of social relationships is bound to change.
In a society such as our own in which primary importance is attached to economic cost and money value, there is likely to be a further advance in food technology bringing with it further influences on social organisation.
Whether this is a good thing or not is a moot point, but what is clear is that, as in the past, if it proves to be profitable we will have it whether we like it or not.
Technology in general and food technology in particular are inextricably intermingled with the philosophy of money value, which permeates western society. While the quality of life may be improved by the ample provision of sophisticated, prepacked foods and the avoidance of drudgery . . . there is also a social price to be paid. The emotional impact of a row of vending machines from which the diverse articles can only be obtained by the introduction of the appropriate coin must be different from that received in the course of a family meal . . . Within an industrial society such as our own, the powerful and persuasive influence of economics—the subject in which human desires are provided with a single index number, their price—is particularly apparent when we come to consider manufactured foods.
Baked beans anyone?
Gwynn Thomas

Politics for a change — here comes the Socialist Party

From the Socialism or Your Money Back blog

It has been decided that the Socialism Or Your Money Back blog will give more prominence to the participation of the Socialist Party (GB) in the upcoming general election in May so in the run-up to it, we will be reducing the number of blog posts upon other topics. 

Around the world, people are clamouring to be heard. They want a voice. People are searching for a way to transform an economic system that benefits the few over the many. They are searching for fairness, opportunity, justice and real change. We must re-envision and renew the workers’ movement. Our world changes - we too must change. But episodes of activism and moments of struggle are not the same as movements. Our challenge is to build anew the socialist movement by constructing a new aim for collective action, the creation of a purpose and object. People seek a movement that promises progress. They want change. We see every day working people coming together and speaking out and pushing forward with determination and dedication for a better future. Millions of people have begun to draw political conclusions about the nature of the capitalist system and the need for an alternative. The alternative is socialism. Anger and disgust is not enough. If opposition to the pro-capitalist parties is to be built, then the working class must build it.

Elections are one of the best ways for socialists to get a public hearing and it raises the morale to discover that there are like-minded workers out there and fellow socialists. If we socialists don’t speak up for socialism in the electoral arena, who will? By fielding socialist candidates in elections, the Socialist Party educates the public about socialism and socialist solutions. We ask for workers’ votes for a new social system, not just a few reforms or a petty changes to the status quo.

Nevertheless, the Socialist Party is well aware that capitalist elections are rigged against us and we struggle to gain a hearing through the media. There is no contradiction between understanding the limits of a bourgeois democracy and at the same time fighting for access to it. The fact is that in every arena of the class struggle under capitalism workers fight an uphill battle. Corporate power is not called "the ruling class" for nothing. Even in the best of circumstances, when unionised workers simply seek a contract, they operate in a playing field where employers have the power to lock them out, hire scabs and threaten to shut the plant - a threat that they sometimes carry out.

 Some on the Left continue, with a variety of pretexts, to denigrate and disparage the electoral battle and to discourage active participation in it. They advance the strange argument that elections, involving public meetings and door-to-door canvassing and distribution of leaflets are not mass movements. To move the ball towards the goal you must be on the field. Everyone can take part and a myriad of skills are needed. At each stage your impact will depend on how hard and how well you play. But one thing is certain - you will have no influence if you sit out the game on the side-lines, preferring the bench of indifference. Certainly, the electoral system is not the only game in town for the working class. But it is where much of the attention of workers will be drawn this year. Those who do not directly participate are obliged to listen to the debates because it fills the airwaves and newspaper columns.

Some on the Left tell us, “You will not get elected,” and cynically accuse us of conspiring to take away votes from reformist candidates such as the Green Party. Make no mistake about it, we want to take away their votes. A socialist is not a supporter of any capitalist party whatever. The Green Party may desire a kinder, gentler capitalism but why would socialists feed the Green Party’s false hopes that capitalism can be fixed? We aim to persuade working people to struggle for socialism. We reach out to workers with a message of hope and with a mission of real struggle.

Different groups of capitalists have different priorities and political inclinations, and back parties that reflect this. One of the key functions of the state under capitalism is to mediate conflicts between different members and sectors of the ruling class. When times are good and profits are high, this is a relatively easy task because there is no need to take drastic steps in one direction or another. But this is a period of economic and political crisis. The ruling class is scattered, competing for influence over their widely divergent views about how to stabilise the system. This contest is played on the electoral field. The growing divides between different sectors of the ruling class opens up greater space for a socialist party to expose the countless weakness of the system.

The Socialist Party does not believe that the solution to the problems facing the working class will come from any reforms passed by parliament. We want a revolution; and, we work hard to make it happen. Our party knows that revolution is necessary. But the election will sorely disappoint anyone longing for real change. Those who want a better life, a better world or an end to war, will not get any of those things from the pro-capitalist reformist parties on parade. In the UK, two capitalist parties dominate political life inside the system. Candidates from the Tory and Labour parties bask in the glow of the media cameras. The contest, however, is really one between two parties of war and exploitation, two parties of extreme wealth. Other smaller parties such as UKIP  demagogically pay lip-service to “the interests of the ordinary people,” but they do not mean a word of it. All of the pro-capitalist parties, time and time again, pledged themselves to manage the affairs of the ruling class. Their campaign platforms may articulate the outlook of different wings of the ruling class, but at the end of the day they all have the same goal. All capitalist candidates share a single slogan — “profits not people”—that is, if they wanted to tell the naked truth. They aim to get elected not to serve “the people” as they claim, but to serve the miniscule capitalist class. Many of their candidates will be actual capitalists themselves.

The Socialist Party is not a party of professional politicians. Our candidates are different because they do not serve the interests of business and capital. Quite the contrary, they have spent their lives fighting against it. The Socialist Party provides a choice for voters. We wish to be a catalyst to raise working-class consciousness. We want to spread the idea of social revolution, of true change. We know that change is possible.

We, in the Socialist Party, take the ideas of socialism - the way forward for humanity- to the electorate. Socialists, to quote the Communist Manifesto, “disdain to conceal their aims.” The Socialist Party’s election campaign is to open a much-needed avenue for workers to wage political combat against the capitalist class and their corrupt accomplices.

Our prospective candidates for ten constituencies are as follows:
Bill Martin - Islington North; Danny Lambert - Vauxhall (London); Brian Johnson - Swansea West (Wales); Steve Colborn - Easington (North East England); Kevin Parkin - Oxford East; Mike Foster - Oxford West and Abingdon; Robert Cox – Canterbury; Andy Thomas - Folkestone and Hythe (Kent); Howard Pilott - Brighton Pavilion; Jacqueline Shodeke - Brighton Kemptown.

Green Party embraces the market (1992)

From the June 1992 issue of the Socialist Standard

When the Green Party finally gave into media pressure and decided to have leaders one of the two they appointed was Dr Richard Lawson. He stood as their candidate in the general election in Weston-Super-Mare where he got 1262 votes.

Last year he wrote an article in the magazine Greening the Planet entitled "Notes towards a Green Theory of Money" in which he tried to argue that "given the right political guidance, money, although a tyrannical master can be a useful servant in the cause of greening the planet". This is to ignore the role that money plays within the capitalist economic system where everything is valued in money terms and where the aim of producing things is to make more money.

Capitalism is based on the ownership of productive resources by a tiny minority of the population. Under it goods and services are produced, not directly to meet human needs but for sale on a market with a view to profit. This unleashes economic forces—"market forces", "the power of money", as they have been called—which come to confront those who take economic decisions as if they were coercive laws, forcing them to to give priority to profit-making both over satisfying needs and over achieving a sustainable relationship with the rest of nature, as well as to accumulate most of these profits as more and more capital. The capital accumulation is of course the "blind economic growth" that Greens see as overloading nature's ability to adjust to human productive activity.

Socialists draw the conclusion that if the environment is to be safeguarded then capitalism must go, to be replaced by a system where productive resources are owned in common under the democratic control of all the people. This must mean the complete disappearance of the market and money. Production for sale and profit gives way to production for use and need. Buying and selling are replaced by giving and taking; people give to society directly in the form of work and take from society directly in the form of useful goods and services to satisfy their needs.

This is not how Dr Lawson see things. In his article the joint leader of the Green Party outlined what he called "a green philosophy of the market" which teaches that the market and money can be controlled by the government and made to function in accordance with economic principles:
We seek not a free market, nor a social market (whatever that may be), and certainly not a command economy but a guided market, the guidance coming from rational consideration of the interaction of economics and ecology, and realised through creative taxation and regulation. Creative taxation weighs heavily on elements that are econegative and gives tax breaks to elements that are ecopositive.
Given the amply recorded failure of all other attempts to use taxes to change the way the market system works—notably the Labour Party's long since abandoned attempt to redistribute income and wealth in favour of the workers—this illustrates an incredible poverty of thought. But it does confirm what we have always said about the Green Party: its policy is the reformist, and ultimately futile, one of trying to work within the present system to "green the planet". It won't work and it can't work.

The only way to green the planet is to first make it the common heritage of all of us. Then we will be freed from the tyranny of market forces and money and in a position to consciously regulate our relationship with the rest of nature in an ecologically acceptable way.
Adam Buick

Marxist Iconoclast (1994)

Book Review from the December 1994 issue of the Socialist Standard

Survival of the Weakest by Ken R. Smith, The John Ball Press (ISBN 871240 06 9 PP336). £14.95

"Love, Science and Social Change" says the legend under the title. If these are the three points on Smith's triangle then it encompasses a wide area of knowledge. The book is a virtual political and social encyclopaedia of the twentieth century but, if is proves a point, the author is willing to sweep back to the pre-history of capitalism - especially to demonstrate his favourite theme, that Marx was in error in arguing that capitalism was an essential precondition of Socialism.

Smith lets friend and foe speak for themselves and adds his own bit. A names index of some nine double column pages leave out few of the great, and lesser, thinkers of today and yesterday. Thatcher is given a small voice but the academics who lent intellectual muscle to her assault on capitalism's mean handouts are well represented. Their ideas are expanded upon and repudiated, sometimes by events, sometimes by their own later wisdom.

Equally examined and explained is the fallacious reasoning of those Liberal, Maynard Keynes and Lord Beveridge, who formulated what was to become the basic political and economic agenda of the Left, Right and Centre in Britain and - especially in the case of Keynes - throughout the entire world of capitalism in the post-war years. Smith introduces their critics, their champions and then, with an iconoclastic sweep of history, consigns the Left's dream of a compassionate capitalism to the graveyard of failed hopes.

Unlike those pundits who, with the demise of state capitalism in eastern Europe, underwent an illusion of disillusionment, the author, with a pedigree originating in his earlier work, Free is Cheaper, clearly shows the irreconcilable conflict between Marxism and Leninism. Marx's vision of a socialist, or communist (for Marx used the terms interchangeably), world was essentially democratically centred, Lenin's elitism was quintessentially authoritarian and the consequence of this, welded to the economic reality of Russia in 1917, was to give the world a grotesque and brutal form of state capitalism masquerading as Socialism.

Smith is a socialist who, despite his peripheral disagreement with Marx, consistently emphasises that while the wages system and its concomitant, commodity production, continue to exist so will all the inherent problems of capitalism. One of those problems, currently and correctly, preoccupying most people is the continuing destruction of non-renewable resources and the general threat to the ecosphere. The contradiction of trying ti reverse this process within the context of a world economy based on the need for relentless growth is well documented.

Survival of the Weakest is a book you will be loath to lend. We see it as a well-thumbed, annotated, perhaps, dog-eared reference volume much prized by students and by those who want to know more about the world they live in.
Richard Montague

Democracy and the Class Struggle (1926)

From the July 1926 issue of the Socialist Standard

Ever since the Bolshevik's coup of 1917, the idea has been widely fostered by their would-be imitators that "democracy" is nothing but a bourgeois snare and a delusion. In the mouths of these so-called Communists, however, the term has meant nothing more than the sham article offered to the workers by the political parties which trade upon delusions.

Conservative, Liberal and "Labour" politicians have all paid lip-service to the popular will and have just as readily ignored it and resorted to the use of force whenever it has suited their purpose. The war of 1914-18 was a glaring example of the contempt which these leaders of the people entertain for their followers.

The Communists, however, while indulging in fiery denunciation of "sober," "respectable," "eminently practical," "legal," "Parliamentary," opportunism, have not offered, as an alternative, anything more satisfying than a crazy and erratic opportunism which exaggerates the importance of industrial action, and regards a street-fight as a revolution. They invite the workers to jump out of the frying-pan into the fire.

The Socialist Party insists upon the necessity for the education and organisation of the workers on the basis of the class struggle and this involves a constant loyalty to democratic methods. This necessity follows logically from its object, i.e., "Socialism."

The workers can only acquire possession in common of the means of life by conscious collective action, and they can only exercise control thereof when they are prepared to assert themselves as a class.

The Socialist Party, therefore, opposes, not only the orthodox capitalist parties (Liberal and Tory) but the so-called Right and Left Wings of the alleged "Labour" movement.

The "Right Wing" professes to be able to use the political machinery in the interests of the workers without first having laid the foundations of political triumph in a clear understanding of its objects and conditions.

Instead of imparting to the workers a sound knowledge of their position in capitalist society, it simply accepts the illusions already prevalent and plays up to them for the purpose of catching votes.

Thus the workers imagine themselves to be free citizens, payers of rates and taxes with an interest in the day-to-day administration of capitalist society; and the Labour politicians thereupon adopt programmes of reforms based upon the alleged necessity of "economy" or "wise expenditure." Their policy presupposes the continued existence of capitalism, and they can, therefore, be nothing more than the tools of capitalist interests, no matter what their motives or intentions may be.

The Left Wing trades upon the repeated disappointment of the workers with their official political leaders. Every act of treachery, every blunder into the enemy's hands is hailed by the Left as a reason for a change of leadership; yet, in practice, the leaders of the Left never fail to follow in the footsteps of those whom they displace. The industrial leader seizes the first opportunity to set his foot upon the loftier ladder of political ambition; the Left is thus continually melting into the Right.

This is inevitable, for the simple reason that the policy of "industrial action," as such, is as barren of benefit to the workers as that of parliamentary reform. The existing Trade Unions are quite incapable of effectively meeting the continual encroachments of modern capitalism upon the workers' standard of life. Nothing less than a complete change of outlook and re-organisation of the working class can convert a chaotic retreat into an orderly advance.

This, however, implies Socialist education; and the leaders of the Left are as loath as those of the Right to undertake this slow and arduous task. It is easier to make showy promises, to tickle the ears of the workers with flattery, and to occupy their attention with personalities rather than with principles.

The Socialist, however, knows and proclaims that conditions and not leaders give rise to movements. So long as the workers see no further than the effects of capitalism and aspire no higher than to battle with those effects, just so long will they trust in leaders to guide them. The underlying causes of poverty, however, become more obvious as time goes on. Increasing numbers of workers are beginning to realise that the ownership of the means of life is the central factor in their common problems, and the leaders of to-day have a less easy task than their predecessors had to arrest the onward march of working-class knowledge. That is the principal reason for the palpable divisions among those leaders, and the constant danger of internal break-up which is characteristic of the "Labour Movement."

The industrial and political organisation of the workers does not arise from an idea fallen from the clouds. The Trades Unions originated in the first early struggles of the factory-hands to prevent themselves being reduced to a level from which they could never hope to rise. They were the instinctive defence against capitalist aggression; but these working-class pioneers were early forced to see that they were obliged to take into account a greater power than the individual capitalist. At every turn they were met by the actions of the Government, the agent of the master-class as a whole. For years they were engaged in a bitter struggle to secure their unions from legal extinction. Hence they saw the necessity for political power, and supported the Chartist Movement, which aimed at the obliteration of class-distinctions in the political field.

The original connection between democracy and the class struggle is thus plain. Just as bureaucracy in all its forms exists only to preserve capitalist interests, so democracy is the logical political expression of working-class interests.

This is in no way altered by the fact that the franchise was conceded by the master-class to serve their own ends. The concession merely indicates that at the present stage of industrial development power lies, in the last resort, at the disposal of the workers. So long as the workers lack the necessary organisation, the masters will utilise their support; but from the workers' point of view, the franchise has only one meaning. It is the instrument of emancipation. As such, the most enlightened of the Chartists regarded it, and the Socialist merely preserves the lessons of experience, keeping in line with the historical development of the working-class.

The pioneers, who penned the "Communist Manifesto," took the same view. "The bourgeoisie itself . . . furnishes the proletariat with weapons for fighting the bourgeoisie" (page 14). "All the previous historical movements were movements of minorities, or in the interests of minorities. The proletarian movement is the self-conscious, independent movement of the immense majority in the interest of the majority" (page 15). 

"The first step in the revolution by the working-class is to raise the proletariat to the position of ruling class, to win the battle of democracy." "The proletariat will use its political supremacy to centralise all instruments of production in the hands of the State, i.e., of the working-class organised as the ruling class" (page 21).

Similarly, Marx, in "Value, Price and Profit," refers to the fact that "This very necessity for general political action affords proof that in its merely economic action capital is the stronger side" (page 50), while Engels again, in "Socialism; Utopian and Scientific," advances the proposition that "The proletariat seizes the public power, and by means of this transforms the socialised means of production into public property." To thoroughly comprehend the historical conditions and, thus, the very nature of this act, to impart to the now oppressed proletarian class a full knowledge of the conditions and of the meaning of the momentous act it is called upon to accomplish, this is the task of the theoretical expression of the proletarian movement, scientific Socialism" (pages 86-87).

To this task we of the Socialist Party have set our hands. Others may attempt to lead the half-awakening mass back into the camp of the enemy, or to lure them, unprepared, to the shambles. The Socialist Party avoids both the Scylla of the vote-catching reformer on the one hand, and the Charybdis of the minority movement fanatic on the other hand.

We seek to instil into the minds of the members of our class the facts that they are slaves needing emancipation, and that they may achieve it when they will by using the powers lying to their hands. Thus, for us, democracy is not something which resides all ready in a bourgeois Parliament. On  the contrary, it can spring into life only with the conscious self-assertion of the working-class majority having for its object the emancipation of all mankind through the abolition of the private ownership of the means of life.
Eric Boden