A Steel Prop for Labour (1978)

From the March 1978 issue of the Socialist Standard

At many a Labour Party meeting, among the querulous Trots, the sandalled thinkers, the ambitious suburban admen, and the ruminative trade unionists there are a few old men, flotsam from the party’s past. They wear broad red ties beneath Donegal tweed, sing the Red Flag with defensive fervour. Grown old in decades of canvassing, licking envelopes, collecting dues, they speak as the constituency’s self-appointed conscience; they can remember when Labour, although in apparently endless opposition, seemed to them to stand for a better society and to be concerned about what they described as political principles.

Their delusions linger, through the reality of the government opposing strikers, or persuading the workers to take cuts in their living standards, or embracing whatever political bandit they are currently doing a deal with, or performing their genuflecting duty to the royal family. The old timers may take consolation from a moody, complaining beer with the ward’s left winger but even that will leave them uneasy about their party’s policies in action.

Any last few hopes they may have nurtured that the Labour Party stood for Socialism, or even had any consistent principles, must have come near to suffocation when, a year ago, Callaghan and Steel concluded the Liberal/Labour pact. However the agreement was dressed up by both sides for their members, the simple fact is that a Labour government which, those old members might have hoped would be able to introduce Socialism, has made a deal with an avowedly capitalist party in order to stay in power. And power, for Labour, means more wage restraint, more cuts in medical and social services, more international nuclear politicking.

Decline

When the pact was sealed, last March, Labour was in an overall minority of nine in the House of Commons. From their point of view this was a grievous come down from the overall majority of three which they won in the general election in October 1974. They have declined even further during the past year and are now kept alive only by the Liberal Party’s acquiescence in the agreement.

The pact was made just in time to avert what would have been a killing defeat on a vote of confidence. Described as an “experiment”, it set up a joint consultative committee to keep an eye on the government’s policies and to inject bits of Liberal policy into them (there is talk of a so-called profit sharing scheme being among the government’s plans for later this year). At the time Steel argued that the pact would tame some of Labour’s wilder ideas, would help secure “agreements” on pay and price restraint and would avoid the election which none of them wanted. Since then the Liberals have been anything but restrained in the claims they have made about the effects of the agreement:

   Since last November the results of this tough and unpopular struggle are being seen in a rise in real wages and a relaxation of the spending cuts. That success was made possible only by the pact . . . Just four years ago the miners, in a confrontation, had thrown the country into a three-day week . . . Today, the miners have voted to dig more coal and to be paid by results. (Richard Wainwright MP at the Special Liberal Assembly, The Guardian 23/1/78)

It is constructive to compare this extravagance with Harold Wilson’s reaction to an earlier agitation in favour of a deal with the Liberals. In September 1965 the death of the Speaker effectively cut Labour’s majority to 1. There was plenty of advice to the government, in the press, that the only way it could survive was by arranging for reliable support from the Liberals. And this was how Wilson, in his memoirs (The Labour Government 1964-70) dismisses the matter:

  Only if there were a prior general understanding between Labour and the Liberals on broad principles could the Liberals undertake to keep Labour in office . . . But his [Jo Grimond’s] proposal would have meant . . . scrapping basic beliefs and philosophy as Socialists. I never considered accepting his proposal for one moment.

The idea of Wilson as a man with a belief in socialist philosophy, and prepared to relinquish power for it, is entertaining but for the moment it is enough to ask, now that Labour has done the deal Wilson refused to consider, what has happened to their “beliefs”. The Liberals have no doubts:

    . . . We have stopped Labour’s spendthrift and dangerous programme of nationalisation . . .  we have a government backed by a majority of public opinion. That is strong government. (David Steel, The Sun, 30.1.78)

If for a long time the idea of a Lib/Lab alliance was an obscene thought in the Labour Party, this is rooted in Labour’s experience. In the years just before the First World War, as Labour was emerging as a political force to be reckoned with, the then Liberal government made a number of proposals for an alliance, even offering Labour seats in the government. On one occasion the Labour leader MacDonald was approached with a little flattery by the Liberal Chief Whip, the Master of Elibank:

   “You are one of our best debaters. The opposition are really frightened of you . . . Will you not join the Cabinet?” (Ramsay MacDonald  by David Marquand)

(Macdonald who was supposed to be so frightening to the opposition, was later described by a colleague of Elibank’s, Winston Churchill, as a “boneless wonder” which must have been confusing for everyone).

Flexibility

At the time MacDonald refused the offer but a couple of years later, demonstrating the customary flexibility of mind, he became enthusiastic for a similar scheme. The outbreak of war in 1914 killed the idea and Labour could join the greater coalition for the defence of British capitalism, at the cost of a few million working class lives in Europe.

MacDonald emerged from the war unscathed and a few years later found himself Prime Minister of a Labour government which was going to bring in the revolution with the support of Liberals who were opposed to it. This period in office was one of Labour’s bad memories, which bred a generation of members distrustful of all alliances with the Liberals; only a year later it was a Liberal initiative in the Commons which brought MacDonald’s government down.

Whatever the Liberals may have hoped to gain from this, they must have been disappointed; in the subsequent election they lost 118 seats and with only 40 MPs they began their long, slow death pangs which linger to this day. In the 1929 election, with the interest roused by their plan We Can Conquer Unemployment which offered public works schemes as a method of reducing unemployment to “normal proportions” (what, might have been asked, is “normal”?) they claimed to be experiencing an Indian summer but when the votes were counted they had scraped up only another 19 MPs. For the first time the Labour Party were the strongest party in the Commons although they again relied upon Liberal votes to keep them in office.

Back in Number Ten, MacDonald was brisk not to say contemptuous. It was, he said, up to the Liberals and the Tories whether there was another election during the next two years. Meanwhile, he would stand “no monkeying”. (He was obviously out of touch with some of his parliamentary colleagues). In fact neither of the other parties relished the prospect of another election so soon — the Liberals in particular feared to sustain more damage — and the Conservative leader Baldwin spoke for them all when he soothed MacDonald with assurances of “fair play”.

Discussions

With Labour safe for a while the Liberals opened discussions about the details of how they would keep them in office. Lloyd George wanted a formal pact. MacDonald offered them a series of joint conferences and access to information—an offer he made in spite of his opinion of Lloyd George as “. . . the most consummate cheat and wirepuller of all time”.

As the crisis of capitalism deepened the exchanges continued, with differing arrangements—talks between MacDonald and Lloyd George (who feared that “. . . unless we can do something to save the situation, the whole lot of us—Liberals and Labour alike—will be swept away by a great Protectionist wave”), hints about a pact between the two parties, a joint consultative committee in regular session.

Like so many other schemes, it was all ended in the Great Crash and MacDonald, in a notable widening of his ambitions, headed the National government which lived until the 1935 election. Another bad experience for Labour, it at least provided them with the excuses which helped them win outright power over British capitalism in 1945.

For winning—getting into power—is what capitalist politics are all about. All the parties which compete for our votes—as distinct from promoting a wider understanding of society—are hoping for some measure of control over the affairs of British capitalism, whether it be the outright power in the grasp of the Labour Party or the indirect influence which, in some circumstances, can be exerted by minorities like the Liberals.

Unity of Principle

When it suits them—and particularly at election time—they pretend to operate under deeply held, inviolable principles over which they are passionately divided from the lot with the rosettes of a different colour. But it takes only the normalities of capitalism—the political problems of a minority government, the pressures of an economic crisis, the emergencies of a war with a rival capitalist power—for their basic unity of principle to assert itself in some sort of alliance or coalition.

This is what Steel and Callaghan have really been talking about, when they have used phrases like “stable government” and “national interests”. The society they stand for has all the stability of anarchy and the interests are those of a privileged minority. If coalition in some form or another has figured so prominently in the politics of capitalism it is a measure of the endurance of the system’s crises and of the politicians’ impotence in the face of it all.

Ivan

Capitalism's Scapegoats (1978)

From the April 1978 issue of the Socialist Standard

In order to keep the workers acquiescing in the system of lunacy that is capitalism, its supporters continually have to invent scapegoats and to point to them as the cause of the hardship experienced by the working class.

During the last four years capitalism has so very predictably been going through yet another period of slump. All the Keynsians, Labourites, Conservatives and other supporters of capitalism who believed and, indeed today mostly still believe, that capitalism can be made to work in the interests of all by the government pumping more money into the economy, have been proved utterly wrong.

Defenders of Capitalism

Naturally no defenders of capitalism such as Enoch Powell, Margaret Thatcher and Iain Sproat MP are going to tell the workers the real reason for this current recession, even if they did know it themselves. So, by means of a well conducted campaign in the media, every so often scapegoats are offered as causes of social problems and the misery of the working class. Students, trade unionists, muggers, immigrants and the unemployed. One by one these groups are singled out by the hack journalists and blamed for the present social malaise.

At the moment immigrants and the unemployed are the groups which are most subject to attack. The supporters of capitalism, regardless of whatever political party they adhere to, ask us to believe that this country is becoming overcrowded with immigrants and that they are aggravating unemployment. The reality is something quite different. Far from increasing, the actual population of Britain is declining due to the falling birth rate and more people are leaving the country than coming into it. Perhaps those who believe that immigration is in some way connected with high levels of unemployment, bad housing and poor social services, would care to explain why all these conditions existed in the 1930s and yet there were hardly any coloured people and very few immigrants as a whole living in Britain. If immigrants really do provide the real cause of unemployment, why is it that in the areas worst affected by high levels of unemployment, such as Northern Ireland, Clydeside and Tyneside, the immigrant population is negligible?

Ignorant distortions

The unemployed, particularly those in receipt of Supplementary Benefit, are frequently abused and declared the cause of many social problems. Few people will forget the vicious campaign of ignorant distortions directed by Iain Sproat MP and his supporters against the unemployed. Many of those out of work are slandered by being called lazy and unwilling to look for work. As any worker should know, employment as such is usually a miserable prospect anyway. But apart from that, the fact is that over the past few years reports have repeatedly shown that for every ten people registered as unemployed, only one job vacancy has been reported to the Department of Employment. Of course, those who believe that unemployment is largely due to laziness and unwillingness to work, never bother to explain to us why in the 1950s and early 60s relatively few people were “lazy” (unemployed), while in the 1930s and today many more have suddenly become so.

The reality is that social problems, such as unemployment, high densities of population in large cities, homelessness, and bad social services, are not caused by immigrants to this country or by any supposed reluctance of the unemployed to find work. When people complain about these social problems they are really protesting about the inevitable consequences of the capitalist system. Under capitalism profits for the owners of industry and the increased wealth of a small minority of the population are of prime importance. Social questions and the human need of the immense majority are pushed into the background time and time again, as is the case today. Cuts are made in education, medical services and transport, etc., and workers are thrown onto the dole queue. All of this is part of a vain attempt to solve capitalism’s insoluble problems.

The urgent need of the day is for workers to realise that all of these social problems are caused by capitalism and that the present system cannot be made to run in their interests, whether the Labour, Liberal or Conservative parties are in power.

Vincent Otter

The Poverty Trap (1978)

TV Review from the May 1978 issue of the Socialist Standard

One thing that is not lacking under capitalism is public exposure and debate of the inescapable poverty that is the lot of the majority. This debate has been taken up by the television industry and the viewers are treated to no-holds-barred confrontations in which not only politicians take part but also those directly involved, landlord and tenant, employer and employee and so on. The general point of view is that things are grim now and the best that can be hoped for is that they do not get worse.

This point came over well in Are We Really Going To Be Rich? (April 4) the Yorkshire Television Production on ITV on the subject of North Sea Oil. Representatives of a mass of conflicting interests made up the studio audience and as if the talents of Jimmy Reid, Sir John Methven, Sir Keith Joseph, Lord Ballogh and all were not enough, no expense was spared to bring in the images of Tony Benn from London and participants from America including top of the pops economist Milton Friedman. Chairman David Frost saw to it that all (except Socialist) opinions were voiced. These ranged from the oil rig hand who wanted “full blooded socialism” (really milk and water state capitalism) to the capitalist who was well satisfied with his stake in North Sea Oil. Or Jimmy Reid who wanted the operators to be directed to buy British equipment, providing it was competitive and the American executive who complained of delays in the deliveries of it.

When it came to the question of what should be done with revenue the government were expecting to get from North Sea Oil, there was general agreement that it should be used to revive ‘British’ industry and reduce unemployment. The Tories wanted to do it by tax cuts and the Labourites by government ‘enterprise’. All seemed to agree that the most they expected was some form or other of capitalism with the wage labour and capital relation left intact. That is, all except Milton Friedman who showed what it takes to be a Nobel Prize winner. He proposed to make lump sum payments to turn us all into capitalists, as these assets belonged to the people, not the government. Apart from the fact that £5,000 as capital could not bring in enough income to enable even the stingiest person to live, capitalism needs workers to produce wealth. This modest handout would not change things, the majority would remain propertyless in the means of production; they are workers, not capitalists. Indeed it is the needs of capital to find a profit that dictated the form the debate took, with workers seeking work and capitalists (private and state) seeking profitable investments.

Any worker having the illusion that there are good times ahead, from an oil bonanza would have done well to learn the lessons of the BBC2 Horizon programme The New Breadline shown on Good Friday. There are, it was claimed, 7 million people living on or below the official poverty line, which has not changed substantially since that established by Seebohm Rowntree in 1899 based on a diet below that of the workhouse, and slightly amended in the 1930s. Also shown were the results — children sent to school without breakfast from Wednesday each week as the money has run out; children reduced to being dressed only in jumble sale clothing. Social isolation is another result, they cannot afford the fares to visit friends and relations; cannot afford their own drink, never mind the round that is mandatory among mates in a pub.

Among these 7 million are old age pensioners. People who, after a lifetime’s work, have insufficient income from pensions and savings to live above the official poverty line. Grinding poverty, with inadequate food, heating and so on is still the future most workers face in the evening of their lives. Then there are the unemployed, victims of the slump in world trade. For many it is their first taste of idleness after years of steady work. Many disabled people, and single parent families, are among the official poor. Even some workers with regular jobs earn wages below the poverty line. What is obvious is that the 7 million official poor belong to that section of society who have to work for wages in order to live; the working class. Most workers are but a couple of wage packets away from the situation of the official poor.

Poverty is therefore not restricted to those who are officially classified as such, it is the condition that workers in general are familiar with. Not mentioned in the programme were the people who not only never need go near a social security office, but never need worry about getting a job. The rich are not irrelevant to the question of poverty. The existence of one is the condition of the existence of the other. The wealth going to the rich of this world comes from the work of the poor. The rich own the means of production, the poor do not. The poor produce more than is required to maintain them as workers and this surplus keeps the rich. Be they old, lame, part of a single parent family, the rich need no supplementary benefits, least of all need they seek employment. The answer to David Frost’s question “Are we really going to be rich?’’ is obvious. There will be rich and poor as long as capitalism lasts.

Joe Carter

Make No Mistake About It (1978)

From the June 1978 issue of the Socialist Standard

John Smith is a painter, Bill Brown is a clerk, and so on; five upright young men. Those weren’t the names nor, one supposes, were the ones on the poster the real ones. What have they got in common? Yes, we know they are all members of the working class, but the poster wasn’t put up by the SPGB. They are, in fact, all in the Territorial Army. However, unlike the usual recruitment advertising, these young men were not shown “learning a useful trade”, seeing the world, or doing anything which would ensure rapid promotion on their return to civilian life. This poster makes no bones regarding what joining the Army is all about (perhaps that is why it was so quickly withdrawn!). Facing the viewer directly, each one carries a submachine-gun.

The correspondence columns of the Daily Telegraph of 20th April were headed “Land of Equal Opportunity”. The first three letters dealt with one of to-day’s “in” subjects — women’s right to be exploited at the same level as their male fellow workers. The last letter, from Lord Monson, ridicules (wittily and quite justifiably) the Equal Opportunities Commission’s injunction to parents to check their children’s books for “sex-assumption rôles”. So far so good. However, in his penultimate paragraph he refers to “the stomach-churning revelation that female recruits to the fighting branches of the United States armed services were being taught to shriek the words ‘kill, kill; hate, hate; murder, murder; mutilate, during bayonet practice”.

We too are appalled. Unlike Lord Monson however, who seems to see nothing wrong in men being taught to shriek ‘stomach-churning’ obscenities during bayonet practice, we protest at the fact that workers are not just taught that it is right to kill each other, but to the accompaniment of chants of hate. MAKE NO MISTAKE ABOUT IT whatever the advertisements (usually) say about the wonders of a career in the Armed Forces, they are about KILLING; workers killing each other at the behest, and in the interests of, their real enemies — the capitalist class.

Eva Goodman

The Guardian solves unemployment (1978)

From the July 1978 issue of the Socialist Standard

Nothing is inevitable about unemployment. It is man-made and man can abolish it.

The above quotation is contained in a box attached to an article in the Guardian (May 19) and is thus the distilled wisdom of perhaps the most distinguished columnist of perhaps the most distinguished paper in the English-speaking world and I dare say a good case could be made out that he is the most distinguished columnist in the entire universe. Unfortunately, without even looking too critically at the statement above, one’s immediate reaction must be—with such geniuses, who needs fools?

We can all, of course, agree immediately that unemployment is man-made. We are well aware that it was not given by God because it was laid down that Mr God (or maybe in these days we should say Mrs God or Ms God) chased out Adam and Eve from the Garden of Eden because of some monkey business with fig leaves and there and then laid upon the human race the injunction to work. ‘By the sweat of thy brow shalt thou eat bread’. No question of unemployment there. It is one of the cardinal points in socialist propaganda that the capitalist system of society, which now obtains all over the world, produces a variety of social evils, prominent among which is unemployment. And as it is obviously true that man makes his own society, it follows that he also makes the evil of unemployment. And can therefore unmake it. Nevertheless Peter Jenkins is talking ignorant nonsense. For what he is saying, throughout this article, is that we have only to put our thinking caps on and, within the context of capitalism, we can simply eliminate the curse of unemployment.

The conceit of this man is truly alarming. It does not even seem to occur to him that unemployment has been a recurrent feature of the world we live in for nigh on two centuries. So what this conceited hack seems to be saying is that, whereas all the other conceited hacks (not to speak of conceited statesmen, academics and similar natural-born leaders of the human race) have lived and died through numerous periods of unemployment, some of which, for example in the 1870s and the 1930s, were far worse than the level being experienced today, yet none of them found the magic cure to unmake this man-made scourge. But he, Peter Jenkins, can provide the cure that has eluded all these other mighty intellects who have wrestled with the problem in all the industrialised nations of the earth.

No doubt the answer came to him in his bath like Archimedes of old. The only difference is that when the latter called out ‘Eureka!’ — I have it — he really did have it and his answer to that particular problem is accepted right up to this day. Somehow one fears that Jenkins’ name will not go down to history in this way. His notion that you can find a cure for unemployment, while still retaining the system which gives rise to it, is no better than looking for the philosopher’s stone.

Jenkins says the answer is to modernise British industry so as to bring the productivity of British capitalism into line with its main competitors. It only needs a moment’s thought from an ordinary mortal to demonstrate that, as a cure for unemployment, this must be nonsense. If it were true that Britain’s competitors who have indulged in so much more investment in industry and have thereby procured a higher rate of productivity (or a higher rate of exploitation of their respective working classes) have solved the problem, then of course the suggestion that all we have to do is to copy them and, hey presto, the problem is solved would sound fine.

But the whole thing is a joke, of course, even though Jenkins is apparently blind to it. Everyone else knows that, even in the currently most successful country in the western world, namely Western Germany, which has a trade surplus running into billions of marks, unemployment is proportionally almost as high as in comparatively backward Britain. Similar considerations apply to all the other relatively successful countries such as France and the USA. Unemployment is rife in them all, yet they all have highly paid scribblers like Jenkins, they all know that unemployment is man-made and not a fact of nature (it is understood that unemployment was not a serious problem among the slaves of Egypt or the peasants of medieval Europe) and yet none of them have ever been able to solve the problem.

The simple fact which Jenkins doesn’t see, is that unemployment is a built-in feature of the anarchic system known as capitalism. So-called crises are a feature of this system and always have been. Slump follows boom follows slump. And a slump simply means that markets are glutted, that more goods have been produced than purchasers have money to buy and consequently there is no profit in producing a still greater surplus of goods. Production is curtailed and workers become unemployed.

It is as simple as that and yet it is, by definition, incurable. What is needed is a system of society in which markets cannot become glutted because there will not be markets. Goods will be simply produced for the direct use and enjoyment of human beings. If, because of the powers of technology, more food or clothes or houses are produced than the human race requires for its convenience and enjoyment, then society may decide to work shorter hours.

Unemployment of this nature, however, would obviously be a boon and not a curse. After all, nobody worries about the sorrows of the class which is permanently unemployed because it is in fact the employing class itself. They are perfectly happy in the Bahamas or Ascot. Nobody seeks to solve their problem of unemployment, because nobody thinks it is a problem. It is no doubt too much to hope that the Jenkinses of this world will ever realise that it is impossible to solve the problem of unemployment in isolation. What we need is the abolition of employment and the introduction of a new, man-made system in which there will be no employers and no employed. And consequently no unemployed. There is no other way.

L. E. Weidberg

'Socialist' China Questioned (1978)

From the August 1978 issue of the Socialist Standard

Our new pamphlet Questions of the Day is, we think, a good 50p worth.

But it does contain an error. On page 86 in the chapter on the Chinese Revolution, we quote from Mao's July 1949 statement On People’s Democratic Dictatorship.

. . . and we must unite with the national bourgeoisie in common struggle. Our present policy is to regulate capitalism not to destroy it.

Unfortunately, we omitted the word “present.” You may be excused for asking 'So what?’ However a blunder is a blunder. Besides, some members of a maoist sect were particularly annoyed and accused us of being liars and distorters.

The omission of the word “present” is important to the maoists. They believe that the policy of regulating capitalism no longer applies because China is now Socialist.

Let’s examine that claim. The People’s Republic inherited from the Nationalists a sizeable state-owned sector in industry, banking and transport. About one third of industrial output was produced by enterprises confiscated by the Nationalists as Japanese assets at the end of World War II. It gave Mao and the Chinese Communist Party a base for increasing state ownership.

At first, private enterprise was allowed to continue. After all hadn’t Mao urged the workers to “unite with the national bourgeoisie in common struggle”? (Whatever happened to the class struggle? You may well ask) This meant that those hundreds of thousands of capitalists got their reward for backing the winning side in the civil war.

Between 1952 and 1955, economic and ideological pressures coupled with financial inducements helped enlarge the state control at the expense of private ownership. Government policy was still to regulate capitalism, and the system was officially referred to as “state capitalism”.

Then in 1955 a large scale nationalisation drive was launched to convert the rest of the private enterprises in modern industry to joint public and private ownership.

By the following year 67.5 per cent of industrial enterprises excluding handicrafts was government owned. The remainder were joint public and private enterprises. (State Statistical Bureau. Ten Great Years, Peking 1960.) The Government apparatus was still busy regulating capitalism

But wait! Here’s Mao claiming to have established socialism. In his speech ‘On the Correct Handling of Contradictions Among the People.’ Feb. 1957. (Selected Works Peking 1977 vol. 5, p. 394) he says:

But our socialist system has only just been set up; it is not yet fully established or fully consolidated. In joint state-private industrial and commercial enterprises, captalists still get a fixed rate of interest on their capital, that is to say exploitation still exists.

And How. In these public-private enterprises, the capitalists, in return for relinquishing full ownership received 5 per cent annual interest on the value of their investment regardless of profit or loss. This remuneration was promised to private stockholders for a period of six years. It should therefore have come to a halt in 1962.

However in 1966, Dr. Barry Richman, a Canadian consultant in management and economic development, went to China on a two month tour. He visited eleven cities and in the course of his research project conducted interviews in some 38 industries with over 200 Chinese people including managers, Communist Party and Trade Union Officials, specialists, engineers and other workers.

The results are in a bulky 968 page tome entitled Industrial Society in Communist China (1969). The chapter entitled Communist China’s Red Capitalists is most illuminating. It opens as follows:

   On my visit to Shanghai in May 1966 it was indeed disconcerting for me to be picked up by a native Chinese capitalist in a new Jaguar, taken to his large factory for a day of discussions, and later to his sumptious home where he still lives as a wealthy industrialist does in a capitalist nation. Mr. Wu Tsung-i, my Chinese Communist capitalist acquaintance not only lives like a capitalist but also looks like a capitalist and at times, still thinks and acts like a capitalist . . .

No wonder. His investment was assessed at $640,000 from which he was paid the equivalent in yuan of $32,000 per year. He also picked up a salary of 380 yuan per month. But Mr. Wu was small time.

Comrade Liu Tsing Kee was a real Chinese fat cat. A member of both the Shanghai Congress and the National People Congress, he received a whacking $400,000 annually from his five major cotton mills. His family assets were estimated at $16m and according to Richman he employed four servants in a palatial home which was stuffed with antiques.

Richman reckoned that there were about 300,000 capitalists in the People’s Republic. Ninety thousand of them, he said, were in Shanghai alone. And this was supposed to be Socialism.

As recently as 1972 Professor Ishwar C. Ojha of Boston University attended the funeral of the late minister of Foreign Affairs, Chen Yi. The professor told our companion journal The Western Socialist (No. 3 1972) that the national capitalists were represented by one of their number. In his opinion however, they were at that time somewhat subdued and not advertised as extensively as they had been in the past.

At the present time the Chinese ‘socialists’ are not very forthcoming about the status of the national capitalists. Perhaps they’re just too much of an embarrassment.

But regardless of their current standing one thing is obvious. The Chinese Communist Party equates socialism with nationalization. Mao himself said so in 1949.

   When the time comes to realize socialism, that is to nationalize private enterprise, we shall carry the work of educating and remoulding them (the national capitalists) a step further.

(On the People’s Democratic Dictatorship)

In the opinion of Professor Alexander Eckstein (China’s Economic Revolution, Cambridge Press 1977)

    . . .  a country embarking on the process of deliberate industrialization in the mid-twentieth century will necessarily develop a different industrial structure than a country that may have experienced its industrial revolution amidst laissez-faire conditions in the nineteenth century.

State ownership in China is nothing more than a move towards modernisation in an attempt to enable China to compete effectively with other nations in 20th century capitalism.

Apologists for the Chinese regime sometimes maintain that criticism is irrelevant because they are building an egalitarian society.

Professor Eckstein found little evidence of this when he visited China in 1972.

     “On the contrary,’ he writes on p. 281, “as one travels around China and meets peasants, workers, cadres, and high ranking government officials, status differences are clearly apparent in many subtle ways such as dress, bearing, deference by others, and many other privileges that surround power positions in all societies.”

He also points out that wages of top people can be as much as twenty times that of the lowest paid.

The Chinese Communist Party, being supposedly Marxist, would presumably be aware of Marx’s pronouncement on the possibility of egalitarianism within the wages system.

     Upon the basis of the wages system the value of labouring power is settled like that of every other commodity: and as different kinds of labouring power have different values, or require a different quantity of labour for their production, they must fetch different prices in the labour market. To clamour for equal or even equitable retribution on the basis of the wages system is the same as to clamour for freedom on the basis of the slavery system. (Wages Price and Profit)

Modern China has commodity production, buying and selling, wages and prices, money and markets—all the paraphernalia of capitalism.

Speaking about the modern state Engels pointed out:

   The more it proceeds to the taking over of the productive forces the more does it actually become the national capitalist, the more citizens does it exploit. The wages workers remain wages workers—proletarians. (Anti-Duhring)

Anyone who still doubts that China is capitalist has only to consider Chairman Hua’s newest master plan —the introduction of bonuses, work quotas and piece work (Guardian 28th April 1978)

As any British factory worker knows, piece work is an attempt to increase productivity and therefore profits. It causes a speed-up in work rate which can lead to tiredness and a relaxation in safety standards.

Marx’s view of piecework was straightforward. It was, he said “the form of wages most in harmony with the capitalist mode of production.” (Capital Vol. 1) 

After the great leaps and the five year plans the Chinese Communist Party’s policy is still to regulate capitalism—only conscious political action by a majority of the world’s working class can destroy it. 

Eddie Toal

PAMPHLET QUESTIONS OF THE DAY

CORRECTION

Our attention has been drawn to an error on Page 86 of this pamphlet. The word ‘present’ was inadvertently left out of the last sentence of the passage quoted from a speech by the late Chairman Mao. It should read ‘Our present policy is to regulate capitalism, not to destroy it’.

The same quotation was used in its correct form in the Socialist Standard October 1974.

Proper Gander: Home Truths (2017)

The Proper Gander column from the August 2017 issue of the Socialist Standard

Over 11 million people in Britain live in rented accommodation, mostly owned by private landlords, as opposed to Registered Social Landlords (councils and housing associations). The two kinds of landlord differ in the way their organisations are structured. RSLs don’t have shareholders to swallow up profits, so any surplus from rents collected is supposed to be re-invested into maintaining properties and building more social housing. The rents which RSLs charge are shaped by government, with the aim that they are more affordable to people on lower incomes. Private landlords are individuals who own the properties they rent, so they can choose the amount they charge and wait for the profits to land directly into their bank accounts. The terms of a tenancy agreement may or may not differ much between the private sector and social housing, depending on how closely the landlord sticks to the law and accepted practice. Consequently, renting from the private sector often involves even less security and shoddier properties than with RSLs. While many private landlords live in luxury bespoke villas, their tenants struggle to afford cramped flats with damp walls. How would these landlords react to having to live in the conditions that their tenants endure?

We find out in The Week The Landlords Moved In (BBC1), another one of those ‘switching lifestyle’ reality TV programmes, the offspring of Wife Swap and Undercover Boss. Each episode follows two landlords who move in to one of their own properties for a week and manage on the same income as their tenants, who temporarily move to other accommodation.

The participating landlords include a father and son who own properties worth £7million in London and the commuter belt which bring them £15,000 a month profit. Another has 80 properties which draw in £30-£40,000 rent each month. Two young entrepreneurs boast that they earn £750 an hour, and talk of people and property as ‘investment vehicles’. All the landlords are open about being in the property business to rake in the dosh, with ‘buy low, rent high’ and ‘let it and forget it’ as business models. One cannily realises that for him, the housing crisis is an opportunity. With lots of people looking for fewer properties, private landlords can pick which new tenants can pay the highest rents, boosting their profits.

The properties they rent out include a two bedroom flat on the London / Essex border for £950 a month, £575 for a room and communal kitchen in Milton Keynes, and £450 a month for a two bedroom flat in County Durham. Mould is often thrown in at no extra cost, and many flats have unique features such as peeling paint on bathroom tiles and electric meters shared with the neighbour. Fixtures and fittings may not be fixed and fitted. Some of the tenants lack the confidence to report repairs or problems, worried about being evicted if they are seen to be awkward. Many live in fear of having to move out if the rents increase beyond their means. They have often learnt to manage without things like adequate money, heating, storage space and working appliances, things which the landlords take for granted. So, when the landlords move into their own substandard rented accommodation, it comes as a shock. Living on less than £100 disposable income for the week is another eye-opener for those used to ten times that much.

Living as tenants gives the landlords some much-needed empathy. One tearfully (and belatedly) comes to understand that he’s responsible for someone else’s living conditions. Another realises that he should be looking at the properties not through their ‘functionality’ but as homes for people. After the week is over, many of the tenants return to renovated and redecorated rooms and assurances that the properties will be maintained better in future. The landlords’ previous reluctance to re-invest much of their profits back into maintenance shows how the profit motive leads to greed and a poor quality service.

The Week The Landlords Moved In illustrates the alienation that the housing system engineers between people. Landlords are distanced from their tenants not only through their differing legal rights to the property, but also through the differences in their wealth. Their relationship is financial and bureaucratic, rather than co-operative and on an equal basis. We’ve learnt to accept as normal the notion of someone else owning and having control over where we live. And of course it is a normal, integral part of the system. But consequently, our homes don’t often have the security and comfort that they should provide. Paying a mortgage to buy our home doesn’t necessarily give where we live more stability, either, as then we’re financially tied to a bank instead of a landlord. And this option isn’t realistic for anyone unable to pull together the thousands of pounds needed for a deposit and solicitor’s fees. Capitalism turns where we live into a commodity, which shapes the way we relate to our homes. For the millions of people surviving on a low income, lacking the money (and the right) to make improvements, home doesn’t always feel like home. For the landlords, houses are likely to be seen just as sources of income, at least until a TV programme makes them think twice.

Mike Foster

The Questions They Ask . . . (1978)

From the September 1978 issue of the Socialist Standard

"Mr. Speaker: What is the difference between capitalist economics and socialist economics?”

Speaker: (Thinks! What a smashing question!)

Answer: - The difference is the Labour Theory of Value. This law of capitalism, discovered by Marx, explains the operation of capitalist production and the exploitation of the worker.

The Labour Theory of Value states that the value of commodities is fixed by the amount of labour they contain. But not any old labour. “Socially necessary” labour, the labour required by society to produce an article. The determination of Value by the labour in an article was well known to the famous classical economists before Marx: William Petty, David Ricardo, Adam Smith and Ben Franklin the American; whom Marx quotes approvingly in Volume I of Capital (page 59, Kerr edition). "The value of all things . . . is most justly measured by labour"

The difficulty they found themselves in was this

1. Value is determined by labour.
2. What then determines the value of the labour?

They then went round in circles until Karl Marx cut the Gordian Knot by proving that Labour Power, as a commodity, is also subject to the Labour Theory of Value—that is, the amount of labour to produce and maintain a Labourer. Since those days capitalist "economics” have become a joke; starting with Marshall’s absurd "Marginal Utility” and finishing with J. M. Keynes’ disastrous inflation theories. Meantime the colleges teem with pompous wise-acres solemnly expatiating on "status” and "honours”, "power and conflict”, “blue-collar and white-collar workers” “the reward hierarchy” and associated trivialities.

Once you reject the Labour Theory of Value, you become an apologist—for capitalism.

The Labour Theory of Value also explains why, after 50 years of reformist legislation, Labour Parties have had no effect whatever. While they are trying to tart up capitalism with a few spraying jobs, an endless stream of profits pours into the laps of the capitalists, behind their backs.

A clear grasp of the Labour Theory of Value is a MUST for a scientific Socialist.

It is Socialist Economics!

Next question.

Horatio.

The Power of the Vote (1978)

From the October 1978 issue of the Socialist Standard

The gaining of the vote by the working class in Britain, has provided a tool for its emancipation. In the past workers were destined to the political life of their masters’ choice; today, the vote gives us the power to determine our own destiny.

Historically, it is difficult to determine quite how the vote was won. Some historians see the working class franchise as being granted by class conscious radicals solely for their own interests; almost as if the working class was a political pawn in the plan of the ruling class. Other historians recognise the immense working class desire to influence the decisions of government, discernible from before the Chartist movement. Both views of the rise of political democracy contain more than a grain of the truth. What cannot be denied is that, having gained the vote, the working class has not significantly exerted its strength to bring about any change in its own favour. The ideological power which the capitalist class hold over the working class is such that, despite a change in the franchise from landowning minority at the beginning of the last century to full adult franchise today, there has been no corresponding alteration of the social system from one benefiting a parasitic minority to one benefiting all people. That the working class has not used the power of the vote is certainly contrary to the expectation of many of its early opponents, who believed that giving the right to affect political decisions to non-property owners would instantly lead to social revolution.

The worst fears of the opponents of the extension of the franchise did not occur; the parties of capitalism have successfully won working class support, election after election, by offering reforms in return for votes. The electorate, which overwhelmingly comprises workers whose political interests would best be served by the establishment of Socialism, have jumped from Labour to Tory and back again in a futile effort to use their votes to obtain the most they can out of capitalism. The choice of a party to vote for is seldom based upon rational judgement; this is even recognised as a necessary characteristic of electoral behaviour in a major survey of voting habits:

     There is nothing inherently wrong in the fact that electors associate the parties with images and not with politics . . .  if party support was entirely rational and solely based on policies representative government would become unworkable. The parties would never be able to count on some loyal support in cases of blunders and difficulties; nor would they ever be able to rally their supporters and thereby educate public opinion . . . voting is clearly partly an emotional affair. It is based on prejudices as well as on rational assessment . . .

(Jean Blondel, Voters, Parties and Leaders)

Blondel’s view is that most people vote for a party, not because its policies stand for their interest, but because parties set out to project images to draw voters into a mythical conception of that party solving problems. Workers vote Labour because “it’s the Party of the welfare state” or “the Workers’ Party”, or vote Tory because it is the thing to do if you have a mortgage.

One might conclude from all this that the vote is of no use to the working class. On the contrary, the vote is rather like the razor blade; you can use it to cut your throat or to have a shave. So far the workers have used the vote to register their consent to the present system. Each time an election comes around, seventy-five to eighty per cent of the electorate vote, mainly for the Labour or Conservative parties. About twenty per cent of the electorate regularly abstain from voting, although it is impossible to tell how many do so positively (as a conscious refusal to vote for the parties standing) and how many are negative abstainers (those who do not care). Even among those who do not vote many are confused or cynical. Many Labour voters may decide themselves that they want to see a social change in the interest of the working class, many Tory voters are looking for a party that will defend them from the omnipotence of the State, many Liberals are simply not voting for the others.

When the next election comes workers will once again be faced with the dilemma between voting for politicians to lead them into five more years of capitalism or not voting at all. But there is a third possibility, which is not voting for useless leaders, but considering the idea of Socialism and then voting for it. The Socialist Party of Great Britain exists to provide an alternative to those who wish to lead the working class. A vote for Socialism in the General Election is a vote in your own confidence to determine your future. If there is a Socialist Candidate in your constituency he will be conspicuous by not grovelling for your vote, but only asking you to vote Socialist if you understand and want Socialism. If there is not a Socialist Candidate but you want to cast your vote for Socialism, then write “Socialism” across your ballot paper. In every election it is power that is at stake; are you going to give a blank cheque to the parties of the profit system or will you use your vote in your own class interest?

The weapon of the vote is yours; you have only to use it.

Steve Coleman