Sunday, November 17, 2019

Finance and Industry: Dollar Safety (1966)

The Finance and Industry Column from the June 1966 issue of the Socialist Standard

Dollar Safety
If you believe all that is said by the propagandists about the cold war between America and Russia then in the words of James Baldwin they have all the baddies and we have Gary Cooper. But where there is a threat to the profits of the capitalist class the facade sometimes slips and they are prepared to use any tactic, however dirty, to safeguard their position.

Consider the case of Ralph Nader, an American lawyer, who published a few months ago a book entitled Unsafe At Any Speed. The book showed, according to reports in various English newspapers, that the accent on car production in America was on rapid obsolescence; safety factors were ignored because they tended to interfere with yearly restyling and production costs. Not unnaturally in a country where the motor car is concerned in the death of 50,000 and in the injury of 5,000,000 people each year, the book became an immediate best seller. So great was the reaction that both the Senate and the House of Representatives had sub-committees considering the subject.

The king of private enterprise firms, General Motors, made a bad start when it had to admit having Mr. Nader investigated by private detectives to see if he could be discredited in any way. On the matter in hand it admitted that it had recalled 1,500,000 cars in the past month to remedy defects, at a cost of £2,000,000. Ford and other manufacturers also declared that they had recalled defective cars.

Despite this Henry Ford II was claiming on April 15th that if critics who didn't know what they were talking about, such as Mr. Nader and the Government, would only leave the motor industry alone they would get on with the job. On April 26th his vice-president, John Bugas, was telling the House of Representatives that the whole industry now favoured “effective and forceful Government machinery for setting vehicles safety standards without delay.”

Whether the American motor industry can make cars more safe and more profitable remains to be seen. But according to Governor Romney, a former president of American Motor Corporation, it was the motor car industry that pulled America out of the depression, and according to Mr. Ford it is the mainstay of the present economy. Perhaps there are some who will argue that the death of 50,000 people per year is a fair price to pay in a society which places the pursuit of profit above everything else.

Who’s grabbing?
In earlier years the Labour Party has made May Day the occasion for massive propaganda drives proclaiming what it called the just demands of the working class. Now that it is the Government, and has been for eight of the past 21 years, the tenor has changed.

The Observer of 1st May, 1966, reports on Prime Minister Wilson's May Day message in which he said “We are still in grave danger of paying ourselves much more than we are truly earning.” Minister of Labour Gunter, who recently had his salary raised from £5,000 to £8,500 per year, said we are living in the “age of grab” and later:—
  We are working on an average only half an hour a week less than we were in 1938. This means that it is not the shorter working week we really want but more uneconomic overtime at enhanced rates. I am told that this uneconomic overtime is brought about because basic rates are too low.
It is at least refreshing to know that a Minister is being given correct information. Workers will, and must, try to raise the price at which they sell their labour power when the conditions are conducive to obtaining increases. Until, that is, they eventually realise the futility of it all and do away with the wages system.

Overtime will become the eight-lettered word of 1966. The Prices and Incomes Board have made “Overtime equals inefficiency” their slogan. And a new journal, Management Today, says overtime is necessary because basic rates are not adequate to buy the goods and services workers consider are their due. Although like many generalisations this tends to over-simplify, it is generally true. But it must be remembered that not all jobs offer the advantage of overtime.

But surely this was the position for 13 years with the Conservative Governments and the then Labour opposition was claiming that they would correct all this. The first excuse was that the majority was too small, and now that has been rectified we must wait for the next excuse. The favourite at the moment appears to be the old, one —the lazy and ungrateful working class.

There are still ways of making a quick quid if you have the means to play the game; witness the “bond washers.” Bond washing was a complicated manoeuvre played on the Stock Exchange where a person sold and repurchased shares in different guises, before and after the payment of a dividend, and recouped the income tax on the dividend. You could be as lazy as you like, and no overtime was required. Only lots of money. The Guardian estimated that you needed £500,000 to make a profit of £1,000 and the Sunday Times estimated that the transactions totalled £300,000,000 to produce a profit of £3,500,000.
Ray Guy

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