TU Politics, Marx and the Labour Party (1974)

Book Review from the May 1974 issue of the Socialist Standard

“Labour: The Unions and the Party” by Bill Simpson. (George Allen & Unwin. £4.50. 250 pages.)

This is an interesting book but not for the conclusions it reaches, which are much as to be expected from a trade-union general secretary on the National Executive of the Labour Party. Its interest comes from the fact that the author, in his attempt to justify the Labour Party, finds it necessary to do so by proving that Marx is out-of-date, that capitalism today is not as Marx expected it to be, and that the Labour Party, guided by Bernstein, Burnham, Keynes and others, now knows how to control and direct capitalism in the way it should go.

As background material he examines the events leading up to the formation of the Labour Party, discusses some of the controversies of the time, and sketches its history, including the General Strike and the attempts to control inflation by wages and incomes policies. In answer to the questions he poses he concludes that trade unions should go in for politics and not “direct action”, and should affiliate to the Labour Party.

The book is full of references to Marx and to Marxists inside and outside the Labour Party; to socialist society; socialist principle, revolution and revolutionaries, and so on: but none of this is to be taken literally. His ideas of Marx are hazy like those of the people he calls “Marxists”. His “revolutionaries” are not revolutionary (people who want some modification of capitalism are not revolutionaries because they use direct action or violence) and his “socialism” has no relation to what Marx and Socialists mean by the term. He does not mention the Socialist Party of Great Britain or answer our case. For him socialism means the current Labour Party concept of private and State capitalism (nationalization) and the Keynesian techniques of “managing the economy”.

The few quotations from Marx in the book include a complete misunderstanding of the traditionally misused statement by Marx that “Force is the midwife of every social system pregnant with a new one”. Mr. Simpson uses it as heading of a chapter (Chapter 7) which deals with the syndicalist-“direct action” ferment of the years before 1914, thus making it appear that Marx was advocating the use of force against the State power. The point Marx was making was the direct opposite; he was showing the way in which force is at the disposal of those who are in control of “the power of the State, the concentrated and organised power of society”. (See Capital Vol. I, Chapter XXXI, “The Genesis of the Industrial Capitalist”.)

Marx noted the forms taken by this force, from “brute force” used by colonial powers in their colonies to “the national debt, the modern mode of taxation and the protective system” which were used by the capitalists through their control of State power “to hasten, hothouse fashion, the transformation of the feudal mode of production into the capitalist mode, and to shorten the transition. Force is the midwife of every old society pregnant with a new one”.

Mr. Simpson’s idea of revolution and revolutionaries is illustrated by his belief that the strikes in the period up to 1914 meant that revolution was imminent:

What would have happened if the war had not started is difficult to forecast. This much can be said: if there was a time when revolutionary change was near in Britain it was surely then. (Page 69)

So the workers who had voted for capitalism in the election of 1910, and did so again in 1918, and for five years in between had been fighting to defend British capitalism at the behest of (among others) the union leaders who had been organizing the strikes, were bent on revolution — but when their leaders waved a flag at them they decided to call the whole thing off!

The argument as Mr. Simpson presents it is that while Marx “explained clearly how the capitalist system worked in a technical sense” (p. 131) he failed to forecast correctly the forces that would be operating later in an advanced capitalist society. He was wrong, says Mr. Simpson, about the concentration of capital, wrong about the workers becoming poorer, and did not foresee how it would be possible for a Labour government using Keynesian techniques to keep unemployment down to a very low level and avoid crises, so that since the nineteen-thirties all we have had according to Mr. Simpson is “a few uncomfortable lurches” (p.125).

If Mr. Simpson had understood Marx's clear exposition of what happens when a government steadily depreciates the currency, he would see that it is precisely the Keynesian techniques that have been largely responsible for the price level now being six times what it was in 1938. As it is, he has no idea what inflation is all about.

On unemployment he disregards the continuous powerful upsurge since the nineteen-fifties, to its peak in 1972. Registered unemployment then went over the million mark but his leader, Harold Wilson, contended that the real number of people out of work (registered and unregistered) “was nearer three million” (speech at Liverpool, Financial Times 10th April 72). And is Mr. Simpson still sure that the present crisis is just a “lurch”? The Labour Party Election Manifesto in February 1974 used very different language: “the most serious political and economic crisis since 1945”, and “economic perils of a new dimension; we face a crowning test of our democracy”.

When Mr. Simpson claims that the continued existence of large numbers of small businesses and retail shops shows that Marx was wrong about concentration, he not only ignores the flood of amalgamations and takeovers that are common knowledge but also leaves out of account that in every crisis (as at present) the small firms become more vulnerable. At all times their independence and that of small retail shops is more nominal than real.

He quotes the higher standard of living of workers as disproof of Marx. He says (p.120) that according to Marx “the mass of the people would become so poor (“the pauperization of the masses as he called it”) that the system would collapse and there would be a revolutionary change in society”. What Marx actually wrote was: “in proportion as capital accumulates, the lot of the labourer, be his payment high or low, must grow worse”. It was social position, not falling real wages, that Marx referred to. His co-worker Frederick Engels saw the matter in proper perspective. When in 1892 he observed that British workers “are undoubtedly better off than before 1848” and that the condition of those in trade unions “has remarkedly improved”, he did not think this was a denial of the general view held by Marx himself. (The Condition of the Working Class in England, Frederick Engels, 1973 edn. pages 34 & 35.) But Mr. Simpson may be just finding out that in the present “lurch”, notwithstanding a Labour government, many workers are going to see their real wages falling.

Marx never supposed that capitalism would disappear of its own accord simply because of its internal contradictions and the workers’ poverty; it would need to be abolished and replaced by Socialism through the conscious organized action of the working class gaining control of State power.

Throughout his book Mr. Simpson treats the theoretical conflict between Marx and his Labour Party critics as if it is merely about different ways of achieving Labour-Party “managed capitalism”. He nowhere faces up to the fact that for Marx Socialism meant a fundamentally different social system, involving for example production solely for use, and the abolition of buying and selling and the wages system. This ought to have been considered by him because some of the people active in forming the Labour Party, including Keir Hardie, Shaw, and Sidney Webb, had broadly accepted it and presumably believed that it would be achieved by the Labour Party. It is strange that a trade-unionist who claims to know Marx does not even mention Marx’s plea to the unions to aim for the abolition of the wages system instead of seeking “a fair day’s wage for a fair day’s work”, which is what the unions and the Labour Party continue to offer them.

What, in effect, Mr. Simpson and his Party are saying is that capitalism is now different because it is “controlled” and therefore Socialism in the real sense is not necessary even if possible. So the justification of the Labour Party falls back on the arguments of those among its founders who, like David Shackleton, said in 1906: leave Socialism alone and get on with “something practical”. This basically is Mr. Simpson’s position though he is not entirely happy with it, for he notes (p.51) some of the “social evils seventy years ago yet which are still far from resolved”. Unemployment is one he names.

Another was housing, and not even the most satisfied Labourite can believe that the problem has been solved. It was not a Labour leader in 1906 who said “the number of homeless is increasing week by week and waiting lists are growing” but Labour’s new Chancellor of the Exchequer. Dennis Healey, in his Budget speech on 26th March 1974.

One of the sillier beliefs of the Keynesian Labourites was that their control of capitalism gives them control of interest rates, which they could reduce at will. As it happens, in the year of the formation of the Labour Party an organization calling itself “The Workers’ National Housing Association” was jubilant because they had been promised government financial aid for housebuilding of £4¼ million at interest of 3¼%. Current interest rates arc about four times as much, but when on 14th March this year the Labour Government was asked what they were going to do to stabilize interest rates their spokesman in the House of Commons, the Paymaster General, replied:

Interest rates will in the future, as in the past, have to be responsive to changes in domestic and external conditions.

Marx explained this a hundred years ago.

For Mr. Simpson all the efforts of Labour governments to improve capitalism are “socialist” and he tells with evident pride that John Wheatley, Housing Minister in the 1924 Labour government, “put through an excellent Housing Act”. Socialist? Not at all, said Wheatley himself:

The proposals which I am submitting are real capitalism — an attempt to patch up, in the interests of humanity, a capitalist ordered society.

(Hansard, 3rd June 1924)

This is what the Labour Party has been doing for years, patching up capitalism. Workers, inside and outside trade unions, should certainly take an interest in politics — but for Socialism, not for Labour Party capitalism.

Edgar Hardcastle