Everyman a Capitalist (1959)

Editorial from the June 1959 issue of the Socialist Standard

Classifying objects by their essential similarities and differences is a necessary step to thought and action.. Every trade unionist does this when he organises with others who live by receiving wages, against employers who live on profits. The Socialist does it when he differentiates the system of society known as Capitalism from a basically different system of society he calls Socialism.

But the words that enable us to think clearly can also be used to cause confusion by linking up unlike objects which happen to have unessential similarities. Outside of politics the absurdity of this is easily recognised. Nobody thinks himself justified in describing an ice-cream as a small iceberg, a stickleback in a mill pond as a small whale, or a pigmy as a tiny giant. But in politics this kind of thing is going on all the time and most people do not readily see that it is fallacious.

We are led to consider this by the current campaign of the Tory and Labour parties “to make everyone a Capitalist."

A Board instead of a Boss 

Not that the two are agreed on how they propose to do this. The Labour Party came to it through a series of debasements of the ideas some of its founders had half a century ago. Appalled by the spectacle of arrogant wealth and abject poverty existing side by side, they thought that if the government appropriated the land, factories, railways, etc., we could have a nation of people all employed by the State and living in comfort and on a more or less equal standard of living. Apart from that drastic act they proposed that the other features of life in Britain would go on as before: buying and selling, importing and exporting, holding colonies, taxation, saving and spending, etc. They soon decided on grounds of practical politics that confiscation was impossible, but they continued for a long time to proclaim their intention of nationalising the land and the major industries. Six years of Nationalisation by the post-war Labour Government practically killed it. The voters clearly did not much like what they saw. It was all very well a dozen years ago to tell unions and railwaymen that they, along with the rest of the workers, had joined the Capitalists by becoming, through the government, the owners of the mines and railways, but talk of this kind would get a cool reception today from the miners and railwaymen who are being sacked because of redundancy. They do not feel that they are any better placed than the redundant cotton workers; being sacked by a Board instead of by a boss is no less painful.

So the old sweeping Nationalisation is off, and when the Tories accused the Labour Party of intending to nationalise 600 big firms, instead of saying “Yes, of course,” as they would have done in their early days, Mr. Morgan Phillips, Secretary of the Party, issued an angry denial. “We do not intend—and we have never stated in any official document—that it was our intention to nationalise the large firms.” (Daily Herald, April 30th, 1959.)

The new Labour Party plan is for the government to buy shares in large companies and in general not to take them over.

The Labour Party still maintains that it is Socialism they aim at. They called the original scheme Socialism, and they call the new scheme Socialism. They were wrong then and wrong now. Government control or ownership of whole industries or of shares in companies is Capitalism not Socialism. The Observer, (May 3rd, 1959) is quite right when it says of the Tory plan and the Labour plan: “What is significant is that both parties nowadays rely equally on the process of Capitalist growth.”

All to be Capitalists!

The Tory plan, sponsored by a Conservative Party Committee in a booklet “Everyman a Capitalist," is similar in that it proposes the buying of company ordinary shares, but it differs in that the shares are to be bought by individual workers. They will, however, not buy them direct but through investment trusts, which will buy shares in a number of companies and then sell industrial investment certificates to individuals.

The ideas behind both plans are much the same. They are put in the form that it is a good thing to have more people “owning a stake in industry,” and that these new small owners will share in the growth of capital and profits of the companies.

There are several things wrong with the reasoning. Ten years of low unemployment on the one hand and rising prices and profits on the other, have not altered the fact that depression with its heavy unemployment and falling profits and bankruptcies are just as “normal” to Capitalism as are its booms. Workers who buy shares expecting only rises may find themselves owning depressed or worthless shares. It is always the big speculators, “the men in the know,” who have the best chance of selling in time. 

Secondly, the relatively small sums owned by individual workers do not cease to be only trifling amounts in comparison with the wealth of the Capitalist class by being put into company shares instead of being deposited in a Savings Bank. Even if the prices of shares and profits of companies went on rising the relative position would be the same, because the wealth of the rich would be growing at the same time. All the changes of the past 50 years have not altered the basic relationship that about a tenth of the population own about nine-tenths of the accumulated wealth.

Small Millionaires

Thirdly, and more important still, the relationship between the Capitalist, who lives by the wealth produced for him by the working class, and the working class who produce that wealth, but receive only a part of it in the form of wages, is not altered at all. The worker who has a few hundred pounds saved does not cease to be dependent on wages because he receives interest or dividend of a few shillings a week from his investment. And, to come back to where we started, the possession of a few hundred pounds does not change a worker into a Capitalist. A Capitalist is a man whose wealth is large enough to enable him to live on the “property income” he receives from it, an income derived from the exploitation of the working class. The worker with £300 is no more a "small Capitalist ” than he is a "small millionaire."

Why are the Tories fostering this idea? Clearly it is with the purpose, not of making us all into Capitalists— which is as impossible as having a social system in which all the population, including the slaves, are slave-owners —but with the intention of deceiving the workers into believing that they have an interest in preserving Capitalism.

The Institute of Directors have issued a booklet called "Mind Your Own Business" warning companies against the dangers of Nationalisation. It is a very good description of what workers ought to be doing, provided that they recognise that their employers’ business belongs to them, not to the workers they employ, and that the two schemes, Tory and Labour, for promoting what a city editor calls "popular Capitalism” (Manchester Guardian, 4th May. 1959) are both of them useless and dangerous to the working class.