Labour Withdraw (1985)

Party News from the July 1985 issue of the Socialist Standard

Guildford Branch apologises to members and supporters who were denied the opportunity to hear a debate with the Labour Party is Farnborough on 26 June. The Farnborough & Cove Branch of the Labour Party had agreed in principle to a debate with us, but this decision was later overruled by their Branch Executive Committee who explained that ". . . the Labour Party shares no common ground with the SPGB, and no useful outcome would result".

It is certainly true that the Labour Party has absolutely nothing in common with the SPGB but the idea that no useful outcome would result illustrates just how arrogant and unprincipled these apologists for capitalism are. The title of the proposed debate — "What is socialism and how can it be achieved?" — was probably the real reason why the Labour Party backed down; they do not know what socialism is, and they certainly do not know how it can be achieved.

Is there life after Thatcher? (1984)

From the July 1984 issue of the Socialist Standard

Ungrateful dole queues and Social Security claimants did not celebrate the news that Margaret Thatcher intends to be Prime Minister after the next general election. Will they really have to endure the sculpture of her hair and the nag of her voice for so long? Will she rule over their misery for ever? Or, if she ever does leave the scene, will there be very much left for her successor to take over?

With her huge parliamentary majority, Thatcher can afford to ignore such reservations. Under her leadership, she claims, something called Britain has found something called a new confidence and purpose and all sorts of desirable things arc going up—industrial output: the number of people in work: "personal income”; profits. These are obviously examples of manipulating statistics, viewing movements from a base figure which is convenient so that changes always seem to be as you want them. The allegedly upward movement in employment, for instance, has clearly not happened since Thatcher came to power although it may be possible to make it seem that something like it has occurred in very recent times. So the three million who have not been part of the increase in employment, those who are in work but subject to the downward pressure on wages which has followed large scale unemployment. and those who battle to survive on the meagre state allowances, will not be impressed by the figures. Neither will those who find it increasingly difficult to get prompt medical treatment or access to social services or who are aware that civil liberties are under a growing threat . . . Of course we are accustomed to Prime Ministers telling us that their period of office is one of progress into an enduring prosperity but beneath this specious rhetoric an odious reality festers.

There was rather more gratitude and celebration among the Tory grassroots, although it must be said that political awareness does not flourish in that particular piece of undergrowth. Thatcher is, after all, an unexpectedly effective vote-winner and her blatantly populist appeal to the more regressive impulses among the working class pleases the constituency workers who lick all those envelopes and trudge all those streets. The Prime Minister’s loyal parliamentary lieutenants also made the predictable noises of ecstatic expectation, perhaps spurred on by the unusually large number of cx-Cabinet ministers now lolling on the back benches as a result of disagreeing with the female fuhrer.

In another part of the Conservative Party feelings were not unmixed. Those who see themselves as prospective occupants of Number Ten may become restless and rebellious if Thatcher hangs on so long that they miss their chance; like many of her predecessors, she has neglected to bring on any likely successor, as was the case with Eden and Churchill. Thatcher has also developed a knack of absenting herself when these aspirants are in trouble, as she did when Leon Brittan was wrestling with the siege at the Libyan Embassy. From the unlikely origins of a provincial grocer’s daughter, Thatcher has learned much about the dirty game of politics.

Much of the dismay which greeted Thatcher’s declaration was caused by her name being linked with unemployment, cuts in services, pit closures, attacks on the National Health Service and so on. People who think like that regard the present plight of British capitalism and the wretched poverty of millions of workers here as the results of a deliberate, unnecessary Tory policy, largely the personal inspiration of Thatcher herself. This too is a grass roots opinion and it is just as ill-informed and unhelpful as the ecstacy in the Tory constituencies.

The first thing to be said on this score is that Thatcher’s actions arc by no means unprecedented. In her anniversary statement, when she looked back on five years of Tory rule and forward to centuries more of it, she gave this warning to all workers who might think of struggling to protect their living standards against the government’s attacks: "A lot remains to be done . . . and every bit of industrial disruption just adds to the mountain we have to climb". Nearly twenty years ago, on 26 October 1964, Harold Wilson was saying the same sort of thing, in one of his regular hectoring appearances on TV: "The old fashioned restrictive practices have no place. We must get rid of monopoly practices, overmanning the job, costly demarcation arguments, and a temptation to indulge in wildcat strikes". Wilson was talking about an ".  . . extremely serious economic situation which the country is facing", and just as he was a precedent for Thatcher so there were precedents for him. In the twenties many staple industries, on which much of the fortunes of British capitalism rested, were in decline. Coal, iron and steel, shipbuilding and textiles were particularly hard hit by the rise of foreign competition and as they were in many cases concentrated in a few centres their decline caused severe hardship and depression also to be concentrated. Just as they are nowadays, areas like the Rhondda and the Tyne became wastelands of despair, relieved by occasional flashes of rebellion. It seemed then, as it is thought by some people now, that large segments of industry in Britain were being destroyed never to revive—and there was a popular tendency to blame this on the deliberate policy of a particularly callous government. The similarly popular remedy was to change the party in government to one which promised to be less callous—like one including Philip Snowden, Jimmy Thomas, Ramsay Macdonald . . .

Illustration by George Meddemmen.

Anyone who thought, and who now thinks, like that simply does not understand capitalism and its cycle of economic activity. The depression of the twenties was followed by a measure of recovery before the Great Crash and the intense misery of the thirties. The war saw another recovery and for some years a condition in which full employment was itself a problem to the capitalist class because of the strength it gave to the workers’ bargaining. A succession of governments, Labour as well as Conservative, grappled with the problem of holding wages back at a time when the pressure was for them to rise. They called their attempts at restriction by many names—a pay pause, stages one. two. three . . . : the social contract, and so on. They all amounted to the same thing: a government trying to do its job of running capitalism in the interest of the ruling class and against the interests of the working class.

The post-war boom, so long-lived, was beginning to falter just as the minority Labour government of 1974/9 came to office. After a brief honeymoon with their election manifesto, during which they bought off the miners’ strike which had given such anguish to Ted Heath, Labour got down to the affairs of the British capitalist class—which meant assaulting the workers' living standards. As the recession deepened Labour deserted the very Keynesian policies which, they had once so confidently argued, were the positive remedy to any slump:

   It was Denis Healey, not Geoffrey Howe, who first put monetarism on the agenda of British politics, and abandoned a Keynesian strategy. It was Healey, not Howe, who put prices and profits before public spending and jobs (Stuart Holland MP, Guardian 16 June 1980).

Keynesianism was not alone as a cherished principle to be rejected by that government. A party with its roots in the trade unions, and so to be expected to look favourably on union activities to improve workers' conditions, they fought the unions to the last day of their office. When that courageous and useful bunch of workers, the firemen, were forced into strike action in an effort to improve their meagre pay, it was the Labour government which contemptuously broke the strike with the use of blacklegging troops. When the hospital workers, another group of socially useful people, struggled for better pay and conditions, Labour ministers urged that blacklegging should be a normal, accepted practice:

    I assert very clearly that everyone has the right to work and everyone has the right to cross a picket line. It is not a sacred object and I hope they will do so (James Callaghan. House of Commons, 23 January 1979).

Of course the Labour government claimed that all of this—holding wages down, breaking strikes, cutting services—was all done to improve our lives although they could never satisfactorily explain just how this was to come about. It was all, they said, something to do with fighting inflation, by which they meant rising prices and the inexorable alternative was high unemployment, once described by Denis Healey as ". . . by far the biggest single cause of avoidable human misery and suffering’’ (House of Commons. 20 April 1972). At the time the Tories were in power so it was safe for Healey to anguish about human suffering but when his time as Chancellor ended unemployment had doubled, extending this avoidable misery to twice as many people as under the Tories. Healey had celebrated his accession to the Chancellorship with a threat to squeeze the rich until the pips squeaked but in the event the rich did rather less squeaking under Labour than under the Tories. During the Heath government the proportion of wealth owned by the top 1 per cent fell from 30 per cent to 22.5 per cent; under Labour it climbed, to 23.5 per cent in 1975, 24.9 per cent in 1976 and so on.

The reasonable conclusion from all this, comparing one period of capitalism to another, and government by one party to that of another, is that there is nothing of significance to choose between them. Capitalism in the early thirties under MacDonald is little different from capitalism in the early eighties under Thatcher. Anyone who thinks that things here are so bad that they should escape abroad must think again, for there is little to choose between capitalism in one country before another. In France, for example, the Mitterrand government, which was greeted by delirious left-wingers as the start of a socialist revolution, is now carrying out policies which are to all intents and purposes identical with those of the Giscard d’Estaing administration which it succeeded. Finance Minister Jacques Delors recently spelled out what Mitterrand "socialism" means: 

   The road to economic salvation can only follow a model which puts the accent on a drastic drop in inflation, maintenance of the buying power of our currency, and the ferocious search for competitiveness.

Delors’ austerity programme, according to the Guardian (4 May 1984) is being compared to those of Thatcher, Reagan and the former right wing Premier Raymond Barre. By the same token it could also be compared to those of Healey and of Labour Chancellors of the past—Cripps, Snowden, Gaitskcll.

None of this is coincidental. This present recession affects capitalism worldwide and politicians all over the world are trying to deal with it in the same futile, anti-working class way as their predecessors in office did. There have been slumps before and there will be again, for they are endemic to capitalism. The preferred remedies remain basically unchanged through time and space despite the fact that at no time and nowhere have they been effective. The only thing which changes is the political personalities who promote these remedies, and the succession of impoverished workers who obstinately support what the politicians represent in the face of the massive evidence that this is all a waste of effort.

The simple, clear conclusion to be drawn from this is that we must look for something more fundamental and enduring than the characters of politicians and their panicky responses if we are to understand capitalism and why it works as it does. A social system rooted in class ownership of the means of life is essentially anarchic; it cannot be controlled by economists or politicians; it must produce conflict and impoverishment for the mass of the people. That was what happened before Thatcher ever came squawking into her Grantham babyhood and it will be happening after she is gone to her grave.

So yes, there will be life after Thatcher—the life of capitalism. When she leaves office some other politicians will go through the same impotent deceptions and will be the object of a similar ill-informed adulation.

Ivan

Editorial: Williamsburg conference (1983)

Editorial from the July 1983 issue of the Socialist Standard

At the end of May a conference to solve world economic problems was held at Williamsburg, Virginia, attended by representatives of four European countries, America, Canada and Japan. It was one of a regular series of such conferences, the next to be in Britain in 1984.

Verdicts on the conference ranged from the self-congratulatory official statement — “Our discussions give us new confidence for recovery" — to the Financial Times — “Two Cheers for Williamsburg" to “Playacting" (Liberal/SDP Alliance) and “Fiasco", "Catastrophe for the whole world" (Labour Party). Margaret Thatcher claimed that the conference decisions were an endorsement of the policy of her own government.

In the agreed statement of aims the conference declared itself in favour of reducing inflation, interest rates, unemployment, government spending and budget deficits; encouraging investment and aid to poorer countries; stabilising foreign exchange rates; getting rid of trade barriers, conserving energy and developing alternatives to oil.

The Times (31 May) reported that in the private discussions the European leaders, especially Mitterrand, were highly critical of America for its current budget deficit of £125 billion which, they said, is the cause of high interest rates in America and prevents interest rates from falling in other countries. Mitterrand. before the conference met, had been pressing for a world monetary conference like that at Bretton Woods at the end of the last war, which set up the International Monetary Fund and the World Bank. He did not get his way but the conference did agree to consider a high level international monetary conference at some unspecified time in the future.

The International Monetary Fund and the World Bank have a particular relevance to the present situation because it was the declared aim of those institutions to expand international trade, keep unemployment down, increase production, raise living standards, encourage investment and make exchange rates stable — all problems which the Williamsburg conference found itself once again considering nearly forty years after Bretton Woods. And Bretton Woods was not the first. Some twenty years earlier, after the first world war, a series of international monetary conferences took place also dealing with inflation, unemployment, falling production, trade barriers and unstable foreign exchange rates. There was a link between those conferences and Bretton Woods, in that the economist J.M. Keynes played a part in both.

And earlier still, in the 19th century, a number of inter-government conferences took place to deal with monetary problems, including the stabilising of exchange rates by setting up the gold standard in most of the industrialised countries. This did not prevent the Great Depression in the last quarter of the century, during which the British government set up a series of committees of enquiry to try to discover why the depression and heavy unemployment had happened and how they could be avoided in future.

Capitalist economists have always taken the view that stable exchange rates arc desirable in the general capitalist interest. A British company importing from abroad wants to know that the American dollars or German marks it pays will cost a known and unchanging number of pounds. The British company exporting to foreign countries likewise wants to know that it will receive a known and unchanging number of pounds. But, as in all such questions, there are sectional conflicts of interest. While not wanting constantly changing exchange rates. British exporters have an interest in the pound being fixed at a low rate against foreign currencies because, for a given number of dollars or marks for which their exports are sold, they receive a larger number of pounds. Conversely, British importers have an interest in the pound being fixed at a high rate because these imports will cost them fewer pounds.

The gold standard was a method of stabilising the exchange rates between all countries on the gold standard, as each of the national currencies was legally fixed at an unchanging weight of gold. (The British pound at about a quarter of an ounce of gold.) In the years 1900 to 1914, for example, the exchange rates between the pound, the dollar and the German mark (all being gold standard currencies), were completely stable, showing only minute fluctuations. The gold standard also brought comparative stability of prices because all the gold standard currencies were tied to gold. It did not prevent changes of prices due to other factors, such as the rise of prices in booms and fall of prices in depressions. The gold standard ruled out anything like the multiplication of average prices by about eighteen that has occurred in Britain since 1938.

It is here that we see the outstanding difference between the Bretton Woods agreements after World War Two on the one hand and the gold standard agreements of the 19th century and the international monetary conferences after World War One. Capitalism's major problem, as the Bretton Woods conference saw it, was not inflation and prices but unemployment and depression. It was the beginning of “The Age of Keynes" who had shown them, as they thought, how they could for ever get rid of both, and maintain a state of permanent boom and low unemployment.

For many years events seemed to support their trust in the Keynesian doctrine, though in fact low post-war unemployment happened for other reasons. Then came the day of reckoning, the present world depression, in which it is not a question of having to deal with inflation or deal with unemployment, but having to deal with both together.

Robert Skidclsky, Professor of International Studies at Warwick University, told their sad story in The Times (4 June):

  In the last ten years things have gone terribly wrong. The talisman has failed: economics — and economics — are in a mess. There is scarcely a government of a major country in the world which would now call itself Keynesian. The charge against Keynes is that in putting out one fire, unemployment, he started another one, inflation, which in the opinion of many economists was bound to bring back unemployment too.

Those economists have one thing wrong. It is not inflation which brings about unemployment and depression, or deflation, or the gold standard, or Keynesian doctrine or anti-Keynesian doctrine, but capitalism itself. That is the way capitalism operates, with the cycle of alternate periods of expansion and boom and periods of depression and heavy unemployment.

There was one set of economic doctrines not present at any of the international conferences of the past hundred years — that of Karl Marx. Indeed it was specifically claimed by the Keynesians that Keynes had destroyed Marxian economics for ever. This has led some economists to wonder, now that the Keynesian doctrine has failed them, if perhaps they can find in Marx the real way to maintain capitalism in permanent boom. They won’t find it. Marx’s conclusion was that capitalism can only operate in accordance with its own structure and economic laws and that the way out is to abolish capitalism and establish socialism.

Capitalism and hunger (1982)

From the July 1982 issue of the Socialist Standard

One of the commonest platitudes to trip glibly off the tongues of politicians is “the interests of the community”. No politician would say that people do not matter; rather, they claim that work, administration, services and facilities should serve the well-being of all of society’s members. But, in reality, this is not the case. There is a wide difference between what we expect of society and the real way it works.

Production is crucial to everyday living. It should provide for our food, housing, clothing, our enjoyment of leisure, and our care of the aged, the sick and the young. We should manage this with dignity and security. These are the things that society should be organised to provide for.

So how does capitalism measure up to this expectation of life; the reasonable view for example that food should be produced directly for people to eat? We find that this is not what happens. When a farmer or some “agribusiness” makes a decision to organise food production, feeding people is just about the last thing they have in mind. What they firstly have in mind is making a profit and accumulating capital.

Although the operations of some capitalist farming enterprises are ruthlessly exploitative, farmers in general are not particular social villains. In a capitalist world they do not have much choice. If farmers were to invest in food production against the judgement that they will make a profit, they would be committing economic suicide. The object of the farmer is to accumulate capital, not to waste it. That is why the farmer goes in for food production, why he invests in land, fertilisers, seeds, farm machinery, and above all why he invests in farm labour power.

But still the naive might think that the production of food for profit enables need to be satisfied, and that without the profit motive we would all starve. But the reality is that the need for food, under capitalism, is only satisfied when it constitutes a market. The facts are that people starve because they cannot afford food, and it is a result of their poverty position in the social relationships of production that they cannot do so.

Reality is not what it is commonly assumed to be. Capitalist production uses human wants for making profit. Human wants are satisfied on the prior condition that this is profitable, within the system of producing food as commodities for sale on the markets. The organisation War On Want has reported: “In the Bangladesh famine in 1974 there was three months’ supply of grain stored away, yet people were dying right outside the stores. They could not afford to buy what was there".

The mention of commodities is important in understanding the object of present society. Every form of society produces useful wealth, but only capitalism produces overwhelmingly commodities. It does so against the background of productive relationships which only operate under capitalism: the exploitation of wage labour by capital. As with capitalism in general, the commodity is a very anti-social thing. Its production tells us more about human denial than human fulfilment.

Under capitalism, as with all forms of society, what is required for food production is the useful labour of food producers. Labour power also functions as a commodity. It is bought and sold at its price, which are wages, on the labour market. The farmer also has to buy machinery, seeds and fertilisers and these are produced by exploiting wage labour in other parts of the total productive process.

The object of the food producing enterprise is to realise profit and the accumulation of capital, so it is looking for values which are extra to the values of the initial investment. The source of these extra values lies in the wage labour part of the investment, because labour power is different to other commodities. Labour power ft the one thing that capital invests in which, when put to use, has the ability to create values over and above its own value. The influence of the markets sets limits to food production which are far below the potential which would be possible were food produced directly for human need.

There are few so-called “developed” countries which do not have government policies intended to restrict the production of food. The balance of restricted production with market capacity is not easy to control. Food which is surplus, not to human need but to market capacity, is stockpiled in wine lakes, butter mountains and so on. Fruit and vegetables are often destroyed so that the market price might be protected.

In America, thousands of tons of grain are stockpiled. The American government has made various attempts to restrict food production. One example was the “soil bank”, where farmers were compensated for taking land out of production. It failed, partly because farmers cultivated their remaining land more intensively and this resulted in higher food production. Thus the farmers were doubly compensated, firstly for taking acreage out of production and secondly by receiving subsidies for the extra food produced. In recent years in Australia, a region which has an enormous potential for food production, the Victorian State Government has paid farmers 10 dollars a head to kill cattle and bury them in lime pits, as part of a price support scheme.

Another aspect of restricted food production is that many of the world’s millions of unemployed are farm workers. This only makes sense in terms of the obscene logic of capitalist economics, and brings us back to the real priorities of world capitalism. A farm worker, as with any other worker, is taken out of production when there is no immediate prospect of exploiting his labour power for profit.

We cannot pretend that the object of present society is concern for human welfare. The production and distribution of food is organised as a world business. Its possibilities, but more importantly its limitations, are given within the framework of profit and loss accounts. The human misery which results is not relevant to those accounts.

The human cost of restricted food production and distribution is well known. Understanding of this misery is obscured by the dominant economic interests. Most estimates are that two-thirds of the world’s population do not get enough to eat in sufficient balance to sustain good health. This includes millions in the so-called “developed” countries who are living below the poverty line. The problem was dramatised in the report of UNICEF for 1981 as follows: “Every day this year (1981) 40,000 children died. Usually they were the youngest and weakest of the Third World’s 100,000,000 children who are always hungry”.

Clearly then we need a society which is concerned with the interests of all its members. The alternative to capitalism is a new set of productive relationships—socialism. The alternative to the present world where resources are monopolised by a privileged minority is a world which is held in common and at the free disposal of all humanity. The alternative to commodity production for the market is the production of useful wealth directly for human need.

The transfer of the world into the hands of all humanity and its conscious democratic control for the human interest is the political act of socialism. This transformation of productive relationships will remove the economic limitations of capitalist production and enable us to deal in a practical way with social problems.

The Food and Agricultural Organisation has put together over recent years an extensive description of the problem of hunger, though their analysis of its causes is weak. (They are, after all, funded by world capitalism.) Nevertheless they have collected data on the distribution of hunger, malnutrition and its related diseases, existing food sources and their use, potential food sources, efficiencies of systems of food production, the uses of mechanisation, fertilisers, transport and their relationship to productivity.

The FAO has also studied such aspects of the problem as crop location and scales of production, hybridisation of new plant varieties and their suitability in different conditions, and also food production in relation to conservation of resources and the environment. This knowledge entirely disproves the prejudiced view that hunger is caused by lack of resources or technique.

It must be stressed that while the scale of the problem of hunger requires productive efficiency, production for use need not confine its farming methods to those which have been profitable in the competitive, commodity-producing system of capitalism. It will have wide latitude in its choice of methods which will be decided by necessity and practicality. (Practicality being availability of technique, labour, resources, as well as considerations of suitability such as safety.)

In 1980, world capitalism afforded 20,000 million pounds worth of arms sales, and at the same time carried over 20 million unemployed in Europe and America alone. This represented only a fraction of total wasted labour under capitalism. The socialist policy is that world social production be adapted on the basis of common ownership and production for use so that these wasted resources are used for the benefit of the world’s people.

Pieter Lawrence