Economic Tendencies. (1927)

From the July 1927 issue of the Socialist Standard

 . . . and still the Socialist utters his mumbo jumbo about the imminent coming of the Socialist state; as a fact the whole tendency of our times is in the direction of the multiplicity of small capitalists, every one of whom is a bulwark against Socialism. This increasing growth in the wealth of the wage-earning classes which gathers impetus before our eyes is the whole justification of the principles of Capitalism. (Business Organisation, April.)

If Capitalism is justified on the basis of the above piffle, then its defenders must indeed be running short of subtle and plausible excuses for the existence of working-class poverty: Socialists are not concerned with the “coming” of any state, but with its “going.” With the establishment of classless society (Socialism), institutions such as the State, Government, etc., could serve no purpose : Without a subject class to govern and repress, the object of their existence to-day, their function would be ended. Regarding the growth of “small” Capitalists, one would have thought that in face of the growth of combines, trusts and amalgamations within the last generation, the fact of the concentration of Capital would have a commonplace admission. If the tendency is toward an increase of Capitalists, why is it that every trade paper devotes columns to the reports of bankruptcies in their particular trade? If the smaller fry are unable to stand the competitive pace of to-day, the process is obviously a “coming down,” and not a “going up” one. These business wiseacres have so much justification for capitalist principles that in the same issue of their journal they furnish us with the evidence that gives the lie direct to their previous statement.

Proof:—

  "Personal ownership has given way to the Limited Liability Company, and to-day this is rapidly becoming the large combine or group of companies. . . . the employer is now identified with an association, and these associations are also combined into large federations"—Ibid. 

Imagine the chance that the budding capitalist would have arriving on the scene to compete with the combine or the group of companies. Yet this is the sort of argument that justifies this “rosy” outlook. The present state of affairs is becoming fatal to the small investor. With the stagnation due to want of markets, his investment brings small return in a safe concern, whilst it is well-known what easy prey such investors make for the bogus or apparently promising financial adventure. Karl Marx demonstrated in a way what to-day reads like prophecy —how the battle of competition between the Capitalists is fought out on the basis of cheapening commodities. This is done by increasing the productivity of labour through up-to-date machinery, large scale production and so on. In competition, therefore, the largest capitals beat the smaller. Our opponents, in their weak attempt to meet the Socialist case, pay tribute to the analysis Marx made, and by which he showed the broadening and the deepening of the gulf between the Capitalists and the Workers. It is this gulf that intensifies the antagonism between the two classes as non-producers and owners, and producers but non-owners of wealth respectively.