Letters: Parties and Profits (1977)

Letters to the Editors from the June 1977 issue of the Socialist Standard

Parties and Profits

I subscribe to the Socialist Standard and, in the main, I find the contents of your articles to be both lucid and irrefragable. However, there are several points which, in my opinion, require elucidation.

Firstly, on more than one occasion, you have asserted that the Labour Party represents one section of the capitalist class whilst the Conservative Party represents another. Please identify these two sections of the capitalist class.

Secondly, in your answer to Robin Cox’s letter in your March 1977 edition you pointed out that although consumer expenditure increased by 80 per cent, between 1970 and 1975, the Index of Production rose by 0.6 in the same period. Could it not be that a part, at least, of the extra consumer expenditure was on imported goods not included in the Index of Production statistics, and that had British goods been competitive, there would have been an increase in the Index of Production?

Thirdly, as you adhere to Marx’s version of the Labour Theory of Value, can you explain how it is that retail organizations make profits if goods are sold at their value? Is it by exploiting their own employees?

P. S. Maloney

London N13

Reply

(The first part of this letter was dealt with in last month's Socialist Standard.)

It will be recalled that the original question was whether continued expansion of market demand will guarantee growth in production.

The reply quoted figures for Britain in the period 1970-75 showing that it had no such effect. It is the standard inflationist argument and never works. Capitalism goes through alternate phases of growth of production and stagnation.

It is correct that in the period 1970-75 there was a big increase of imports. They were paid for by loans from abroad. If British goods had been more competitive, imports would have been smaller and exports greater, with a corresponding fall of production in competing countries such as Germany and Japan. But Germany and Japan too were in a depression from 1974 onwards, and the solution for them also, on this reasoning, would have been to be more competitive. Thus overall it would not have prevented British production falling during the depression any more than it prevented production falling in countries where goods were more competitive.

On your last question, Marx distinguished between the “sphere of production” (which includes necessary transportation—Capital Vol. 2, p. 62) and the “sphere of circulation”. Surplus-value, of which profit is a part, is created in production not in circulation. In circulation it is realized, by sale. ‘Circulation, or the exchange of commodities, begets no value.’ (Capital Vol. 1, p. 182.)

Surplus-value is created in production by the unpaid labour of the workers, i.e. the labour in excess of that corresponding to the value of labour-power, wages. In circulation also (wholesaling and retailing) the workers give unpaid labour. (“The unpaid labour of his clerks, while it does not create any surplus-value, 3t least appropriates surplus-value for him, which amounts to the same thing, so far as results on his capital go. This unpaid labour is for him, therefore, a source of profit.”—Capital Vol. 3, p. 346.)

Capitalists in both spheres have the same interest in extending the unpaid labour of their employees. It does not, however, rest on commodities selling at value, which need not be the case. In first explaining the labour theory of value, Marx used examples assuming that commodities always sell at value, but he added that this simplification would be elaborated later. (Vol. 2, pages 244 & 335.)

The elaborated theory showed that in some cases commodities sell above value and in others below value, the price however being determined in accordance with the labour theory of value. (Vol. 3, p. 186). The developed theory Included Marx’s conception of the average rate of profit, i.e. that out of the total social surplus-value, the profit falling to each capitalist, whether in production or circulation, is proportionate (other things being equal) to the size of his capital. (Vol. 3, p. 187.)

All references are to the Kerr edition of Capital.

Editors.

Could Do Better?

How often one hears members of the SPGB accused of being "cranks” and "pedantic”. Is this perhaps because of their habit of frequenting the Establishment’s Sunday-morning soap-box at Speakers’ Corner? The only true Socialist Party in the Land strives to get its message across to tourists and passers-by . . . while the rest of the population is anaesthetized into yet another week of toil under Caesar whom only the SPGB has consistently attacked for seventy-three years.

If the majority of working people have never heard the socialist case why is the SPGB not doing all it should by, for example, exploiting the media and all the other available channels to put across the true case? I submit that this is one of the Party’s inherent weaknesses and, consequently, its methods of organizing and communication should be immediately re-examined.

The SPGB and its fellow parties must seriously ask themselves whether or not they are in civilization’s race to win through. They have not yet successfully put themselves forward as a viable and sane alternative not because of any misconceived concept but because, in their littleness, we cannot hear them!

The SPGB denounces the Trotskyists and WSL but is it not nevertheless a fact that these doctrinaire lefties hold greater sway because they organize at the level of industry and in other significant sections of society? Here they leave the SPGB behind and though SPGB itself claims consistency over these fashionable malcontents it draws no closer to achieving an influential voice.

Comrades, go out into the world of imperfections so that you may establish the numerical strength you so badly need and which will enable the socialist voice to be heard throughout the land. You should collect large sums of money for your innumerable activities; organize membership drives; charge weekly subscriptions; advertize SP literature and products more effectively as in the North American party magazine; hold international conferences; establish a current programme relevant to our immediate situation; exploit the media. All branches should daily strive to establish links with the working class and recruit from all spheres of society.

It is accepted that technology will create the right conditions for the social transformation. But while "we impose the form of the old on the content of the new the malady lingers on” (McLuhan). So why doesn’t the SPGB use the Open Door programme for example?

Jon Lieberman

Oxford

Reply:

Yours is the voice of an armchair philosopher if ever we heard one, asking why we have not provided Socialism yet. Among clauses in our Principles you do not mention are no. 5, which says “this emancipation must be the work of the working class itself” and no. 6, which says "the working class must organize consciously and politically”. Assuming that you are a member of the working class, what are you doing to help get Socialism?

Dividing your letter into two parts, the first lists things which in your opinion we need to do. In several instances we agree. Can you inform us how to achieve them as readily as you suggest? You ask why we do not use the Open Door TV programme. We have been on its waiting list, fobbed off, rebuffed and turned down ever since it began. You say "exploit the media”. We have an active, youthful committee and many individual members who try to get us on radio and TV and in the press continually. The BBC has made clear that it will not have us. How do you suggest we "exploit” them? "Collect large sums of money”—from whom, and by what means (and we do need money, as you say, for our "innumerable activities”)? "Advertize SP literature”—with large sums of money, we could. The attraction of the “Sunday-morning soapbox” at Hyde Park and other places for us is simple; it costs nothing.

The other part of your letter is the reference to membership drives, recruiting etc. A possible inference from this is that we should strive for numbers above all, and so accept members who do not fully understand the Socialist case. It is the argument put forward early in this century by Keir Hardie: that the Social Democratic Federation had made little progress by preaching Socialism, and the need was to recruit trade-unionists—regardless of their attitude to Socialism—and build a strong movement. His policy was given effect. The Labour Party he visualized grew, amassed funds, and became the government; and none of this did anything for Socialism.

We do not know what you mean by saying that the Trotskyists and similar groups "hold greater sway”. At any time such organizations may make greater noise than the SPGB, but their effectiveness is nil—which is why a very large number of them have come and gone during our seventy-three years. Similarly, the technological conditions for establishing Socialism, the capacity for a society of free access, have existed throughout the twentieth century. The task of the Socialist Party is to advocate it, and what governs the strength and variety of our efforts is how many of us there are. You may join without waiting for a membership drive.

Editors.

Industrialization

I should like to draw your attention to the problem of Socialism in the Third World. If an advanced industrial economy and consequently an industrial working class is essential for Socialism, world Socialism would appear impossible without world industrialization. However, even if this were possible it would cause untold damage to the environment. It would seem logical then for the Third World to avoid the capitalist stage of development and pursue an agrarian form of Socialism.

The problem existed in the 19th century between industrial Western Europe and feudalist Russia where the remnants of primitive communism remained. Alexander Herzen and other Russian populists argued that Russia could only achieve Socialism by using these remnants such as the mir or traditional peasant commune as the basis of social organization. Could this be applied to the peasant societies of the Third World today?

Ian Greenslade 

Southminster

Reply:

The idea that every part of the world must still endure the development of capitalism to be ready for Socialism is a mechanistic one which does not correspond to what takes place. When new nations come on the scene they are obliged not to re-enact other nations’ history but to aim at their present stage. The outstanding example in recent years is China, which from being a vast peasant country in 1949 progressed to exploding an atomic bomb in 1964 and has become a major industrial and commercial power.

It is true that at the time of the Communist take-over Mao told the Chinese they had to go through capitalism before “socialism” was attainable. However, the Communists had (and have) no intentions other than capitalist ones. In the preceding twenty years they had built up a large following among the peasants by preaching not socialism but nationalism. If the working class of the “advanced” areas of the world were ready to establish Socialism today, the remainder in relatively undeveloped countries would quickly become conscious of it and be able to go into world-wide common ownership without delay—to their immense benefit, of course.

“Untold damage to the environment” results not from industry as such but from production for profit. Try reading Engels's prescient statements on this in Anti-Duhring (pages 324-5, Lawrence & Wishart edn.). He says: The present poisoning of air, water and land can only be put an end to by the fusion of town and country; and only this fusion will change the situation of the masses now languishing in the towns . . .” And:

  Large-scale industry, which has taught us to convert the movement of molecules, which is more or less universally realisable, into the movement of masses for technical purposes, has thereby to a considerable extent freed production from the restrictions of place . . . It is the capitalist mode of production which concentrates it mainly in the towns and changes factory villages into factory towns.

Engels approved the idea, put forward by Fourier and Owen, of social groups of between 1,600 and 3,000 people—good-sized villages. The closest thing to a town would be four or five of these situated near one another. Every person would work in both agriculture and industry, and young people would be given all-round training so as to incorporate “the greatest possible variety of occupation for each individual”. However, these are precisely the questions—the arrangement of life and labour, and the organization of industry—which a Socialist community would debate and decide for itself.

Editors.

Educating the Educator

On page 6 of your pamphlet Socialist Principles Explained you state: "The founders owed much to the unsurpassed analysis of capitalism provided by Karl Marx." It should be noted that Marx not only owed a great deal to the Socialists of his day, but to those who departed this earth long before him. For Marx’s works are “saturated” with their influence, and in view of that it would be hardly fair to look upon his contribution to Socialist thought as anything but “contributory ’.

Unfortunately, there are always people who are confused into giving those who have made an art of refashioning or re-modelling old theories the designation of originator. Nowhere in history has there been any man who has, by himself, originated or invented anything of any significance without “borrowing” ideas from other men. In that respect Marx’s analysis of capitalism must be regarded to be the combined effort of many men.

To take any other view is tantamount to saying that the inventor of the wrist watch was also responsible for inventing the wheel, lever, spring, buckly, and even time itself!

J. W. Pitt

Worthing

Reply:

Of course Karl Marx learned from others. His writings on economics are full of references to Ricardo, Adam Smith and other investigators And according to his own historical materialist approach, which we accept, people’s ideas are formed by the conditions under which they live, and these conditions include the influence of others.

On the other hand, we doubt your claim that these others, for Marx, included Socialists. Whom did you have in mind? Who, in the 19th century or earlier, advocated a system of society based upon the common ownership of the means for producing and distributing wealth? Who was putting forward the view that only a consciously socialist working class could bring such a society into being? The Utopians drew up blueprints for new organizations of society, but their co-operative settlements were based only upon equal distribution of wealth, not upon common ownership. Others around in the 19th century—e.g. Louis Blanc and Blanqui—some of whom might have been called Socialists, certainly were not so by the second criterion; and, anyway, were more likely to have been influenced by Marx than vice versa.

Editors.

Hemlock and After

I have just read the Western Socialist entitled “Reflections on Religion". To what extent do you feel that the Socialist Party of Great Britain has played a part in declining interest in the Christian way of life in this country over the past twenty years? I would be grateful for your opinion.

Nicholas Fox

Edgware

Reply:

As you will understand from having read the Western Socialist, our opposition to religion is part of the Socialist analysis of the existing order of society. We condemn religious institutions for their rôle in upholding property and exploitation; and we reject religious thought as an obstacle to understanding.

For many years before the last war the SPGB published a pamphlet called Socialism and Religion. It is not produced now because of the “declining interest” you refer to. In general, the decline is due to capitalism itself which in the past saw superstition as an ally but now has to educate people for a complex material world. Numbers of people turn away from religious beliefs which palpably stand against their material well-being—i.e. they do not accept that poverty and meekness are blessed states: and see the number of Roman Catholics who are no longer behind their church’s teachings on birth control and abortion.

Certainly propaganda and argument have played a part, notably in times when to state anti-religious views aroused hostility. However, our position is different from groups like Freethinkers. We attach importance to the rejection of religion—when it is linked with acquiring Socialist consciousness. If it is not. there may be no marked improvement. Religion was the opium of the people, but capitalism offers other narcotics to the unaware.

Editors.

R. O’Neil (London NW1): Your letter reiterating the same point has new been written many times, the only variation being the signature.