Hurrah for capitalism! (1965)

Book Review from the March 1965 issue of the Socialist Standard

An Introduction to Economics by J. C. Powicke and P. H. May, (Arnold.)

At school we were all taught a spurious brand of history, but formal instruction in economics has only recently appeared in school curricula. It is thought convenient that the average worker should take a pride in the history of Britain and the British Empire, but a knowledge of economics is considered unnecessary for most of us. The workers should leave this subject to the experts who will be sure to inform them when it is imperative that they refrain from wage claims, accept a lower standard of living, take up arms and so on. However, having a naive distrust of such experts, I recently attempted to correct this deficiency in my education by reading An Introduction to Economics.

The authors are economics teachers at Chichester High School and their book is intended primarily for secondary school-children taking their “O" level in this subject. The tone of the first few pages is certainly encouraging:

 In economics we must always be scrupulously careful about method. We must begin by collecting all the relevant facts that are obtainable, analyse them carefully and then, and only then, try to draw our conclusions. We may not like our conclusions, they may be very uncomfortable ones, but if our study has been correct they will provide the only sure guide to the working of our economic organism.

Certainly we would not quarrel with this but, unfortunately, these brave words soon evaporate and the rest of the book is composed of the most shoddy analysis and glib conclusions that would not give any capitalist a moment’s indigestion.

The broad picture sketched of present day society is one of rosy affluence where the entire community benefits from its co-ordinated efforts. Although it is stated that the two factors of production are Labour and Capital, it is never explained that this capital is controlled by a minority who have no need themselves to work, whereas the vast majority of the population is faced with no alternative but to sell its labouring power as wage labour. Constant stress is placed on the tenet that capital is at the service of the whole community, who control it jointly. Despite the fact that most of the children who read this book will be members of the proletariat, unjustified use of the first person plural invariably accompanies the mention of capital.

For example:

    Whenever any goods are produced we can choose two ways of using them—we can use them either to satisfy our wants directly or else we an put them on one side for future use. . . . In fact, there is often a considerable difference between the sort of goods which we consume and those we set aside. A great deal of the latter type consists of such things as industrial buildings and machinery. In other words some of the product is designed to add to our stock of capital, and some is designed for consumption, (our italics)

Now and again, however, a glimmer of truth—which might induce an intelligent youngster to question some of the authors' other assertions—can be discerned. Thus, in a section dealing with the decline in competition, they write that “the growth of large-scale production leads to the concentration of an increasing amount of the community’s capital in the hands of relatively few firms.” Clearly such a statement as this cannot easily be reconciled with the suggestion that we are involved in the manipulation and organisation of our capital.

". . .  the criterion of economic efficiency must be the degree to which wants are satisfied out of the use of the available resources of a community.” Because, under capitalism, production is geared to profit and not to the satisfaction of people’s wants, the immediate reaction to this sentence is to conclude that it implies a criticism of capitalist society. But the poverty of these professional economists’ thought is well illustrated by their later amplification of this point “Economic efficiency can be defined as the ability to use the available labour and capital to give the most complete satisfaction of wants . . . ” Thus they demonstrate that all their ideas are hemmed in by the strait-jacket of bourgeois economics; they cannot stretch their imagination beyond the narrow horizon of capitalism. Clearly it never occurs to them that the anarchy of capitalist production breeds inefficiency and that to talk of efficiency in the context of capitalism is to contradict oneself.

It is interesting to note that no reference to Marx is made anywhere in this work although even Malthus is considered worthy of a fleeting comment. Some of the writers' profundities seem to have been devised deliberately to promote misunderstanding. For example, in chapter 9 they maintain that “our income is the value of our product.” If our income represented the value of our product, how could profit possibly be accounted for? They have conveniently overlooked the fact that surplus value, created by the wage-worker, is acquired by the capitalist because he purchases the former's labouring power.

In the final chapter a summary of the present situation is made:

   There are no inherent weaknesses in the British economy . . . responsibility for the success or failure in solving Britain’s economic problem rests squarely on the shoulders of Parliament. In this instance. Parliament’s first job must be to instruct the community in the nature of the problem and its remedies.

They are incorrect on virtually every point they make. Britain’s economy, like that of the rest of the capitalist world, is riddled with inherent contradictions which no amount of palliative treatment can cure. Only one solution is possible—the establishment of socialism by the working class. This task must be carried out by the proletariat itself; they cannot expect the parliament of the capitalist class to achieve it for them.

But the final comment must be left to the authors themselves. Having outlined the difficulties which they consider Britain is facing, they ask “If Britain’s economic problem can be explained in this way why has it proved so intractable?” Why indeed?

John Crump