Thursday, July 9, 2020

A Trotskyist Oddity (2020)

Book Review from the July 2020 issue of the Socialist Standard

I Want To Believe: Posadism, UFOs and apocalypse communism by A.M. Gittlitz. Pluto Press, 

The Argentinian Trotskyist J. Posadas is mostly known among left trainspotter circles for his belief in UFOs and advocacy of nuclear war. This book reveals a different story. Rather than a crankish outlier, he is revealed as pretty much a typical guru of a Trotskyist sect, with policies and positions typical of mainstream Trotskyism.

Born Homero Cristalli, in 1912 in Buenos Aires, he was the child of Italian immigrant shoemakers, who were themselves involved in left-wing politics. He grew up malnourished, and became an entertainer, and (briefly) a professional footballer. Football would be an enduring feature of his life, and his cadres at conferences would be required to have a match, leading in one instance to the French police being called to their supposedly secret meeting place because neighbours heard the shouting.

He became involved in the radical Buenos Aires milieu, and came to the notice of a group of Trotskyists after a short poem calling for unity with the Spanish government (during the civil war) he wrote was published in a left newspaper. The group, the International Communist League (LCI) had been typified as ‘coffee-bar wankers’ (the author, incorrectly, attributes this to Trotsky himself), and were seeking to break out of their intellectual ghetto and connect with the working class.

Cristalli proved to be an enthusiastic and energetic organiser, and made successful work with the shoemakers union. His working class authenticity made up for his limited theoretical grasp of Trotskyist positions. J. Posadas was a collective name of the group’s leadership, and Cristalli began to join in writing Posadas’s editorials. Eventually, he would possess the name entirely (the ‘J.’ was never defined).

Although Trotsky is venerated in many parts for his theoretical subtlety, in reality, his plans amounted to ‘go back to your constituencies and prepare for civil war’. His orientation was to try and form the command/control of a military force that could win that civil war, hence his and his followers focus on leadership. In practice this usually meant small groups trying to orientate towards and piggyback on bigger movements. In Argentina, this meant the strongman Juan Peron, who successfully co-opted the workers movement for his own ends.

Cristalli became a full time revolutionary, depending on the income his faction could bring in from its membership in the Fourth International, and he came to prominence in the internecine manoeuvring of the factions in the international, and became a supporter of Michel Pablo, who ostensibly led the International after Trotsky’s murder. This position, along with his energy and charisma, led him to being among the pre-eminent Trotskyists in Latin America, eventually with groups in Cuba, Brazil and Ecuador.

When the Second World War failed to bring about the revolutionary wave Trotsky predicted, the Fourth International’s leadership veered between trying to enter mass communist parties or supporting anti-colonial guerrilla movements. Cristalli visited Cuba after the revolution there and ended up being singled out as a leader of the Fourth International by Castro as he denounced and suppressed Cuban Trotskyists.

It was the Cuban missile crisis that developed Cristalli’s position on nuclear weapons. He was, though, not alone in wanting a nuclear confrontation with America: Che Guevara and Castro both wanted the conflagration. Cristalli’s position was that the imperialist states would not surrender to socialism without using their nuclear weapons, such a confrontation was inevitable; but that with the greater population of the communist world, only communism could emerge from the aftermath. This was simply a logical continuation of the basic position of Trotskyism to a world with nuclear weapons.

His other famous position, on extra-terrestrials being communists, was in fact not his position. Gittliz reveals that his notorious essay, ‘Flying saucers, the process of matter and energy, science, the revolutionary and working-class struggle and the socialist future of mankind’, was in fact written to close down debate from an enthusiast for UFOs in his party. In some senses his argument ‘We must appeal to the beings on other planets, when they come here, to intervene and collaborate with Earth’s inhabitants in suppressing poverty. We must make this call to them’ is simply a continuation of the notion of appealing to powerful figures to try and make changes.

 The UFOs simply became a distinguishing feature by which other Trotskyists could deride him and distinguish themselves from his organisation.

The secrecy of Cristalli’s organisation was essential in the face of real repression (some of the cadres were arrested and murdered by repressive regimes in Latin America). This, coupled with stern sexual moralism (including seeing homosexuality as degenerate) led to Cristalli controlling the sex lives of his cadres, separating married couples to work in different areas. He abandoned ‘democratic centralism’ in favour of his personal rule of the organisation, or ‘monolithism’.

It comes as no surprise to discover that he was caught receiving oral sex from a young female recruit. He responded in a fashion we are becoming accustomed to from the US president, of accusing all of his colleagues of being sexually promiscuous. He expelled them all, and then fathered a child with the recruit. As Gittlitz notes, this situation is not unique, and other Trotskyist sects had similar stories (Gerry Healy and the WRP springs to mind).

The book ends with an essay on the birth of the Posadas meme as a generation of young leftists rehabilitate the Ufological legend for the slogan ‘Fully automated space communism’, used ironically but still indicating a search for hope in a time of fallen ideas. Gittlitz points out that for a short period, references to Posadas outranked Trotsky himself in Google searches thanks to the memes.
Pik Smeet

Covid-19 and the Money Mine (2020)

From the July 2020 issue of the Socialist Standard

Capitalism has not directly caused the covid-19 pandemic. This coronavirus is by no means the first, and will not be the last, species-jumping outbreak. Nor could socialism guarantee to prevent something like this happening as it is a natural process. However, its rapid spread to ill-prepared recipient societies is most certainly exacerbated by capitalism.

Capitalism has become global while retaining national structures. It is this contradiction that allowed the virus to wreak the havoc it has. The competition engendered by those national structures restricts coordinated international action to temper the worst effects of the disease.

Presently, there is some supra-national cooperation into antiviral and vaccine research, no doubt spurred on by inhibited profit-making caused by national lockdowns. But, stable doors and bolted horses come to mind.

Of the 18 major pharmaceutical companies, 15 had withdrawn from research and development in vaccines, antivirals and antibiotics. There just wasn’t sufficient profit to be generated, unlike from addictive painkillers, tranquilizers and impotence drugs.

Similarly, ventilators and PPE equipment could have been manufactured and held in storage. That a pandemic of some sort was more than likely, and its effects devastating was shown by the Cygnus flu simulation exercise in 2016, and a similar exercise in Scotland in 2018, but the logic of capitalism dictated that no preparations were made.

Why go to the expense of manufacturing, purchasing and storing equipment for something that may not occur? A question and logic that does not seem to apply to the insurance business. Health services, such as the NHS, had endured over a decade of restricted funding that would have made buying preparatory materials beyond their means. And governments wedded to austerity most certainly wouldn’t provide the funds.

Here is the crux. Capitalism has been in a financial crisis of sorts for over a decade. It seems the international debt, which had increased from $84 trillion in 2000 to $173 trillion in 2008, now stands around $250 trillion. A debt more likely to rise than ever to be paid off.

This is the context in which national governments operate. They must protect capitalism, as they did by intervening during the financial crisis of 2008 to prevent banks becoming insolvent. It is imperative that interest rates are kept as low as possible so as not to exacerbate debt levels.

Central banks, through quantitative easing, supply ‘new money’ and indulge in purchasing debt. The major beneficiaries of this policy are the largest national capitalist concerns because, being already relatively rich, means they are safer havens for that ‘new money’ and cheap credit. Those teetering on the brink of bankruptcy, countries as well as companies, can go to the wall.

Meanwhile, the working class, through whose labour power all value is created, face increasing impoverishment. New and increasing debt causes governments to pursue austerity. Those who advocate using government spending to satisfy the needs of the majority and so increase consumption run up against the danger of provoking inflation driving interest rates up.

As prime minister, Theresa May declared there was no magic money tree. The pandemic, though, seems to have opened up a money mine, and deep mining there is taking place. Just as capitalism didn’t create covid-19, so covid-19 didn’t create the capitalist crisis, but it has made it a whole lot worse.

The measures governments have been forced to take to prevent economic and social collapse means the money miners are going to be digging deep for some time to come. The aim must be to restore production as quickly as possible by easing the lockdown and directing spending towards increasing profitability.

Capitalism demands the primary defence of national capital at the expense of the working class. If capital sees only declining, or vanishing, profitability production will be limited or it will cease. The ruthless logic is that the most effective fiscal policy is to supply money to the wealthy, no matter how loudly reformists bleat.

Every time capitalism stands on the ledge, it takes huge infusions of money to entice back inside, money raised at the expense of the satisfaction of human need. Health and social care, pensions, rising standards of living, the whole social wage is regarded as a drain on profitability, to be restricted and reduced.

Response from workers
How does the working class respond? During the pandemic largely magnificently. Many have literally given their lives to bring medical care to those afflicted with the virus. The penny-pinching lack of PPE has had dire consequences. To see the prime minister, and others of the complicit cabinet, standing behind a lectern declaring, ‘Defend the NHS’ has stretched irony beyond satire. It seems such a defence doesn’t entail trying to keep them alive.

Unlike the volunteer workforce that toiled to supply what the government has not, face masks, scrubs and scrubs bags, vital for health and care workers. The tired canard set against socialism is that people are selfish, greedy even and certainly won’t work without the lash of the money whip. Except, in large numbers, they have.

Capitalism provides precious few opportunities for demonstrations of social solidarity, but covid-19 has. The dedication of health and care workers, way beyond their contractual obligations, has been inspiring. As have the efforts of shop workers, delivery drivers et al. While government has fallen disastrously short of fulfilling its responsibilities, people, without requiring direction or material incentives, have stepped forward.

Workers now need to assess what best serves their futures. Brief applause on a Thursday evening was a sign of social solidarity, but also served as a shield that government wielded to fend off scrutiny. How long will ministerial lauding of the NHS last once austerity resumes its principle role?

The treatment of teachers serves as an example. They were praised for remaining at their posts for vulnerable children and to free up essential workers (what percentage of the workforce is deemed non-essential one wonders?), risking their own health in the process. Now they are being portrayed as a self-interested impediment to opening the schools again. Nurses, take note.

There is much talk of how, as lockdown is rescinded, there will be a new normal. A green future perhaps. A benign state, having demonstrated its willingness to intervene economically and socially, may play a positive, ‘socialist-ish’ role to some. Labour and Conservative parties will vie to portray themselves in this guise, the Greens will perhaps promote schemes such as the basic social income. Then capitalist reality will impose itself.

The phrase ‘logic of capitalism’ has been used above. However, there is also capitalist cognitive dissonance. A government that will gamble on leaving the EU without any trade agreements as if nothing has actually changed since the pointless referendum of 2016 seemingly fixed things for all time.

Schemes such as basic income may have an appeal, but it can only be paid for ultimately by drawing money from the total value created for capitalism. Wages, taxes and profit all originate from this source: higher wages, lower profit. Add in the basic income, along with the cost of its administration, and profits must be affected.

Of course, value is created by the working class, so, by whatever means, they are only receiving in part what is actually theirs. Except capitalism does not exist to return to its workers the value they create, only that part they need to live, and work. Right-wing politicians know and accept this, left wing ones either pretend they don’t know this, or delude themselves (and, unfortunately at the present, most of the working class) that it can be otherwise without fundamentally changing society.

Covid-19 has caused a pause for reflection. Politicians have been found wanting, but ultimately the responsibility for their failures rests with all who keep voting for them. The bottom of the money mine is being scraped at the moment, and the ore brought to the surface turns out to be pyrites.

The huge majority, collectively the working class in all its wide variety of roles and manifestations, has the intellectual and creative resources at its disposal to transform the world. There will be future pandemics, but with democratically owned production to satisfy need not profit, a moneyless society to which people freely contribute their talents and abilities, such eventualities may be prepared for and attenuate.

Socialism cannot abolish disease, but it can mitigate its effects without having to be concerned about profits and share prices. Then, and only then, will we all be in it together.
Stood at the kerb of capital,
Striving not to be misled,
Do not look to the left or right,
Keep your vision straight ahead.
Dave Alton

Empire, Free Trade and Brexit (2020)

From the July 2020 issue of the Socialist Standard

The people in the driving seat of the Brexit project love to talk about free trade, looking back to the glory days when free trade was the ideology Britain spread to the world through its empire. This doctrine was so important that the Grun’s The Timetables of History lists the British penetration into South American markets as one of its significant events in that chronology. Freed from the restrictive barriers of the EU and its protectionist ideology, so the doctrine goes, Britain will be able to spearhead its way into genuine free trade around the world, and a new golden age of prosperity will begin.

This ideology is based upon purposeful forgetting built upon purposeful forgetting. The core of the British Empire was most certainly not free trade. As William Dalrymple, in his book The Anarchy, notes, the East India Company – the core of Empire building in India – included waging war in its founding charter. Force, more than free trade, characterised the rule of the British in India. India, in its turn, was the foundation upon which the Empire was built. As per David Graber’s observation in his Debt: The First 5,000 Years, the origin of capitalism is an alliance of interests between the merchant and martial classes.

Dalrymple notes, the East India Company was a private company, and its rule in India was the rule of the bottom line. It was the corporate take-over of a subcontinent. Marx, in Volume 1 of Capital observes:
  ‘English East India Company, as is well known, obtained, besides the political rule in India, the exclusive monopoly of the tea-trade, as well as of the Chinese trade in general, and of the transport of goods to and from Europe. But the coasting trade of India and between the islands, as well as the internal trade of India, were the monopoly of the higher employees of the company. The monopolies of salt, opium, betel and other commodities, were inexhaustible mines of wealth. The employees themselves fixed the price and plundered at will the unhappy Hindus. The Governor-General took part in this private traffic. His favourites received contracts under conditions whereby they, cleverer than the alchemists, made gold out of nothing’.
In turn this was the basis for the primary accumulation of wealth that allowed sufficient capital to be freed up to be invested in industrial production. This is the process that the Marxist geographer and theorist David Harvey refers to as ‘accumulation through expropriation’ the emphasis is not on market exchange, but the direct forceful seizure of wealth.

This was the situation through the period of the rule of the East India Company, and after through the direct rule of the British government. Eric Hobsbawm in his Industry and Empire tells us that the doctrine of free trade never applied to India, and the planned extraction of rents and taxes formed a massive basis of the transfer of wealth from India to the British ruling elite throughout the nineteenth and into the twentieth centuries.

Included in that rent money was the opium trade, which the British peddled to their subject Indian population (in part as a form of control) and forcibly exported to China (leading eventually to wars in which Britain sought to use violence to continue selling those drugs to China). No wonder that late nineteenth and twentieth century pulp fiction was filled with the fear of the opium being forced back onto the British public.

Direct extraction was not the only role India played. According to Hobsbawm, India came to be an important market for British cotton textiles. The industrial revolution helped Britain to smash the advanced Bengali cotton industry, but British rule also helped, and the laws of commerce and trade it imposed to give itself the advantage. As Shashi Tharoor in his book Inglorious Empire notes, this also happened to India’s merchant shipping and ship building industries. Perhaps the Brexiteers are haunted by this historical spectre, and the fear that being entangled in Europe might mean that the trick might well be reciprocated upon them one day (they are fond enough of appropriating the language of decolonisation and ‘independence’ for their cause of tearing away from the EU trade club).

India was permitted some exports: human beings were exported to labour in different parts of the empire, such as building the railways in Africa, and later serving as implanted populations to play off against other communities such as in the West Indies. It also helped to export force, since India was compelled to pay the upkeep of the massive army that ensured British control, and allowed them to send forces from the Indian army overseas: particularly in World War One where India sent over a million men out to France, the Middle East and to garrison the Suez Canal, allowing Britain to check the rise of its rival Germany.

India was a far from backward or underdeveloped land when the British arrived, although it was wracked by factional wars which weakened it politically and which the East India Company exploited to gain the upper hand. The looting by the British contributed to substantial underdevelopment that it has taken a long time since independence to begin to address. Of course, pointing such things out is seen as anti-British by the forgetting machine that wants to block out the real memories of empire.

It is unlikely that this link between force and Britain’s position in the world has escaped the minds of the more serious members of the government. After all, Theresa May tried to focus on security co-operation as a bargaining chip in her dealings with the EU, a sign that people at the heart of government were aware of this. Britain remains a significant military power, but it is unlikely to be able to repeat the conquest of the world by military means, at best it will only be able to exploit its position in worldwide organisations and as an ally of the United States to try and draw off a share of profits and exported ill-gotten gains of despots the world. From the pirate island of empire to being a well-armed tax haven is not an inconceivable trajectory.

The most significant take away is that free trade has never been the reality of Britain’s rise to power in the world, and as its formerly colonial possessions assert their strengths on the world market, short of resorting to insane warfare, British capital can only look forward to a subordinate position in the world league tables. Those other capitalists will have learned the lesson of Britain’s former success, and will use all their might to bend the rules to their advantage. Trade is inextricably tied up with the state and power.
Pik Smeet

Luxury Legoland (2020)

The Proper Gander Column from the July 2020 issue of the Socialist Standard

Monaco is a strange country, a haven for the super-rich on the Côte D’Azur, where the excesses of modern capitalism mix with old hangovers from feudalism. Filmed one year BC (Before Covid-19), Inside Monaco: Playground Of The Rich (BBC2) showed us inside its casinos, government offices and black-tie events. This particular playground costs a fortune to play in – keeping out the riff-raff – and its swings and roundabouts are all gold-plated.

Being not much bigger than Hyde Park in London, Monaco is the world’s second smallest state, after the Vatican City, and the most densely populated. It’s a constitutional monarchy headed by Prince Albert II, who can see more than half the country he rules from his office window. Albert’s ancestors captured the area disguised as monks nearly 800 years ago, and he’s still defended by soldiers (the ‘Carabiniers’) today. The affable prince has allowed the cameras to follow him on his tightly-choreographed official duties and time off, joking that ‘spontaneity has to be scheduled’. We also meet others who live and work in the pocket-sized principality, such as those who clean and organise hotel rooms which cost tens of thousands of Euros a night to stay in, and staff in air traffic control and the harbour who manage the influx of wealthy visitors’ yachts and helicopters. The streets and buildings of Monaco are sleek and pristine, but soulless, like, as someone points out, a ‘luxury legoland’.

Monaco’s demographics are different to those of other countries. Monégasques, or inhabitants with citizenship, are in the minority at just over a fifth of the population, which mostly comprises European ex-pats. There are strict rules around non-natives gaining citizenship, which is granted personally by Prince Albert for those who have lived there for ten years and satisfy other criteria. Citizenship confers benefits such as subsidised rents and priority for employment over foreign nationals. Non-citizens can only last there if they’re sickeningly wealthy. So, another difference between Monaco’s population and that of other places is that as many as a third of its inhabitants are millionaires, often identifiable by their self-satisfied, surgically-enhanced smiles. Proof that wealth is strongly linked to health is shown by the country having the world’s highest life expectancy, at around 90 years. This means that many of its inhabitants are elderly, leading to efforts to court younger super-rich people. These include the social media stars invited to Monaco’s Influencer Awards, whose president is Princess Camilla of Bourbon-Two Sicilies. At the gong-giving ceremony, one ‘influencer’ is asked ‘what are you doing here?’ and quips back ‘looking fabulous’; another is wearing a t-shirt saying ‘make money not friends’.

Proportionate to the number of its inhabitants, Monaco has one of the largest police forces in the world, and they have a zero-tolerance attitude to any misdemeanour and also the right to question anyone at any time. There are strict rules and laws: Monégasques can’t use the country’s casinos and the paparazzi are banned. Even camper vans, uploading photos to social media and walking down the street barefoot are forbidden. But rather than all this stirring up concerns about living in a police state, it’s welcomed among inhabitants as it protects their wealth and privacy. If you can afford to walk along the High Street (not barefoot) wearing millions of Euros’ worth of jewellery, you want to be reassured that you won’t get either mugged or papped.

Monaco isn’t large enough to accommodate industry or agriculture, and so its economy is based on commerce, and especially gambling. In the mid-nineteenth Century, its state was in the financial doldrums until the opening of the Monte Carlo casino, which drew in punters and their money from France, where gambling was then illegal. Since then, Monaco has also hosted money-spinners like the Influencer Awards and, more traditionally, the Grand Prix car race. During this event, Prince Albert hosts a reception at the Royal Palace for 700 guests, who enjoy wine priced at thousands of Euros a bottle and dishes with ingredients including a truffle worth £35,000. There’s enough money flying around that the state doesn’t need to charge income tax, a move which has attracted more millionaires and billionaires to the principality.

Monaco hasn’t found a way of managing capitalism which could be replicated anywhere and everywhere. Despite its sovereignty and quirkiness, Monaco’s economy is tied in with that of the rest of the world, even more so than other countries’ are. Its wealth relies not on the spin of a Monte Carlo roulette wheel or spectacles like the Grand Prix and the Influencer Awards, but ultimately on countless people elsewhere, whose work produces the profits which eventually end up being bet on red or invested in a bespoke super-yacht. All countries are concentrations of capital, and Monaco is also a concentration of capitalists. The lack of common ground between their lifestyles and ours highlights the extent of the class divide.
Mike Foster

Cooking the Books: UBI – Useless Baseless Initiative (2020)

The Cooking the Books column from the July 2020 issue of the Socialist Standard

‘Coronavirus has united left and right on value of universal basic income’, was the headline of an article in the Times (2 June) by Philip Aldrick, its Economics Editor. This is the reform to capitalism under which the state would pay each of its citizens an unconditional minimum income.

The ‘right’ favour it to take the place of free and subsidised services provided to the poor; they want to give them instead the money to buy these services from private capitalists, The ‘left’ see it as a desirable social reform, some as a way to break the link between income and work. The Scottish First Minister, Nicola Sturgeon, has endorsed it, on behalf of the ‘centre’. Socialists are not keen on it at all.

On the face of it, giving people more money to spend seems a good idea. Who doesn’t want more money? But it won’t work, at least not as intended; for two reasons.

The first is that the payment from the state is never going to be much more than ‘basic’, something near the poverty line such as the level to which in Britain a person’s income is made up to under the Income Support scheme. This is in part because the capitalist state will want to keep the amount spent on UBI down, but also because, if the income was too high, it would undermine the economic coercion that is behind the wages system.

If people could live, even if rather sparsely, on the income there would be less pressure on them to go out and find an employer. Some advocates of the scheme say this would strengthen the low-paid workers’ bargaining position and see it as a reason why it should be introduced. But this is precisely why no capitalist government would introduce it at any level other than around the poverty line.

So, if introduced, it would only be as a tweak to the welfare or tax systems, with the basic income replacing other benefits, amounting to no more than a ‘redistribution of poverty’. The results of the Finnish experiment, on which reformists placed such hopes, showed that it did bring some benefit to the unemployed who received it in that they no longer had to submit to what even the Economics Editor of the Times called ‘intrusive and dehumanising’ means testing, nor trying to find a job that wasn’t there (capitalism needs a certain level of unemployment, so there are always going to be some unemployed), nor going on useless courses about how to fill in a CV. On the other hand, those receiving it didn’t show any extra inclination to seek out a job; which was why it is not going be adopted.

The other objection to the scheme is that, as it would be paid to every citizen, whatever their situation and even if they were employed, it would be bound to have an effect on wages; it would strengthen the employers’ hand in bargaining over wages as the price of people’s working skills. Wages reflect the cost of reproducing these skills. So, if wage-workers are paid an amount by the state, the employer will not need to pay so much. This wouldn’t happen immediately but it would exert a pressure for money wages not to rise in line with the general price level. In the end, what the right hand gave the left hand would take away.

The only viable way to break the link between income and work is on the basis of the common ownership of productive resources; that will allow the principle of ‘from each according to their their ability, to each according to their needs’ to be implemented.

Sting in the Tail: Telling porkies (1993)

The Sting in the Tail column from the July 1993 issue of the Socialist Standard

Telling porkies

Clive Soley, the Labour MP for Hammersmith, has really got upset with the government—he believes they may be telling lies about the unemployment figures. Gosh, shock, horror!

In his local paper the Hammersmith Gazette (7 May), Mr Soley is quoted as saying:
  The Tories can't fiddle or fix the Census figures like they fiddle the unemployment figures. They used 27 statistical changes and all sorts of other schemes to get the unemployment figures down. The Census shows that you can't trust the Tories.
He was referring to a 13.5 percent higher figure revealed by the Census than admitted by government figures for Hammersmith. A defence of the government figures was made by officials in the same issue of the paper:
  Not so, the Department of Employment responded. It is simply an easily explained difference between people who are unemployed and people who think they are unemployed. “There is always going to he a difference", said a Government spokesman.
Well, that's alright then. There's a lot of people walking about Hammersmith—some of them are unemployed and some of them only think they are unemployed. Got it?

All right for some

Ever wondered how top executives get those fabulous pay rises we read about?

The Independent business section (2 May) provides “10 arguments commonly put before remuneration committees to justify large pay increases for the chief executive”.

What they all boil down to is contained in argument Number 10:
“You scratch my back, I'll scratch yours". Mr B, the chairman of the remuneration committee, is keen to be generous to the chief executive, Mr A, because he has something to gain. Mr B, after all, is the chief executive of a company whose remuneration committee includes Mr A . . . Mr B hopes that if he raises Mr As pay, Mr A will return the favour by raising his pay when the time comes.
Just imagine if the trade unions decided one another's pay claims in this way, and just imagine the howls this would produce from those same top executives.

It’s a carve-up

A consortium of two shipyards, one on Clydeside and the other in Barrow-in-Furness, has won a £170 million contract to build a naval helicopter assault ship.

They undercut Swan Hunter on Tyneside by more than £50 million. This is an amazing amount and there have been furious claims on Tyneside that the successful bid must have been made below cost and with the aim of driving a competitor out of business.

If Swan Hunter does close then the Clydeside and Barrow yards will have the British warship market all to themselves, and this, despite what they all say about “welcoming competition”, is what every company dreams about.

Trained Youth

One of the nuttier ideas about at present is that crime, especially amongst the young, is caused by indiscipline. Anyone who has that idea should read about an extremely well-disciplined group of young workers— the British army's pride and joy: the Paras.

In the Independent on Sunday (16 May) we learn about one young man in the Parachute Regiment:
  He had his moments, nevertheless, and describes hard-drinking, brawling evenings, interspersed with elaborate rituals involving the consumption of vomit, urine and excrement. Such evenings would usually end with heart-felt renditions of "Lorelei” (“Tomorrow Belongs to Me”), “The Eullschirmjager Song", and “When We March on England”.
So there you have it. Singing Nazi storm-trooper songs, these well-disciplined hooligans are better organised than ill-disciplined hooligans anyday.

More confusion

A visitor to the SWP May Day rally at Alexandra Palace told the Independent (4 May):
  Last year I came for the first time, and I was just overwhelmed: so many people in the same room with the same ideas to talk and argue with. Really exciting.
Come again? Here is a party which recruits on the basis of single issues— troops out of Ulster, the right to work, national independence struggles, any strike, etc. In fact everything except the abolition of the wages system and its replacement by production for use, so it is hard to imagine that there could be “many people” at any SWP function “with the same ideas".

Proof? Ask any ten SWPers for a definition of socialism and you'll get ten different answers—and each will be more ridiculous than the last.

Putting the boot in

It was inevitable that many employers would use the recession to attack workers' wages and conditions, “Lucky To Have A Job” (BBC1, 17 May) showed just how far some of them have gone. Many workers must accept longer hours and less pay or be sacked. There are Essex milkmen who have to work a 70-hour week for no extra pay; full-time workers who are forced to go part-time; part-time workers put on “zero hour” contracts, which mean they only get any work when it suits their employer: and more.

The milkmen's boss justified the 70-hour week by claiming “they choose to do it for the social contact they enjoy”, while the boss of some zero hour workers said they could now “develop their hobbies and pastimes”.

Watching the smirking cynicism of the employers' spokesmen was galling enough for socialists, but what was worse was the meekness and resignation with which the workers involved accepted their lot.

Banks and the Crisis (1993)

From the July 1993 issue of the Socialist Standard

If anything has underlined the capacity of the capitalist system for severe crisis bordering on disaster, it has been the recent report of the Bank of England admitting that in the last two years it had to launch a multi-million pound “lifeboat” fund to support financial institutions on the brink of bankruptcy. Although the Bank has refused to reveal exactly how much was spent on the operation, the Guardian (27 May) reported that “City bankers believe that more than £1 billion may have been used to bail out fewer than 10 institutions”.

The Bank first realized the true extent of the banking crisis in October 1990 and soon went on red alert. It eventually came to believe that over one in six UK financial institutions were at risk from the crisis. This was primarily because the economic slump and the collapse of BCCI provoked what has been described as a “flight into quality”, or towards the big five banks, at the expense of other institutions dependent on the so-called wholesale market where deposits come primarily from professional investors, many of whom were also involved in the slump-ravaged property sector.

The Bank’s report claims that its actions to avert a major banking crisis followed what it calls:
  substantial withdrawals of wholesale funding from smaller banking institutions arising out of a number of factors, including the pressure on banks in major overseas markets, notably America and Japan, the earlier closure of a number of other small British banks, followed by BCCI, and the reactions to those events by local authorities and other places of wholesale funds.
It is clear from the Bank’s report that a full 1970s-type banking crisis was a real prospect—and the report states that the Bank of England still has £115 million in provisions representing outstanding debts at risk.

Some of those banks bailed out by the Bank of England have since ceased trading. Some have effectively worked themselves out of a precarious position while others still depend on the facilities extended to them by the Bank.

Given the anarchy of the market system it is quite easy for a major financial catastrophe to occur under capitalism and shake the system to its roots. This has been amply demonstrated by the recent activities of the Bank of England, just as it was during the secondary banking crisis of the 1970s and, of course, during the major slump of the 1930s, which was exacerbated by the major banking crisis of 1932-3.

One thing is for sure—there can be no sustained economic recovery so long as corporate, personal and national debts are compounding at a rate faster than wealth production. Before the “green shoots” of recovery really start to grow there will have to be yet more bankruptcies, cheap takeovers and massive debt liquidation to ease the pressure on finance, investment and consumption. In truth, with debts in major capitalist states like Britain and the US at such unprecedented levels and with no really convincing signs of sustained economic recovery, the pressures on capitalism’s financial apparatus may be far from over.
Dave Perrin