Friday, September 4, 2020

Inflation and the price of oil (1979)

From the September 1979 issue of the Socialist Standard

The recent increases in oil prices announced by OPEC, the cartel formed by some producer countries, are once again providing Western governments with an excuse for not honouring their oft-repeated promise to keep down the general level of prices. As after the Arab-Israeli War of 1973, we are hearing the refrain again, that inflation is caused by the rise in the price of oil.

Obviously we hold no brief for the OPEC cartel, but the fact remains that inflation is not caused, or even aggravated, by rising oil prices. Inflation, as the word’s etymology suggests (inflate = blow up), means, correctly understood, an over-issue or blowing-up of an inconvertible (into a fixed amount of gold, that is) currency. In fact, in the nineteenth century the phrase was often given in full as currency inflation, inflation of the currency.

The inevitable result of over-issuing, or inflating, an inconvertible currency, is a rise in the general price level. All prices rise in the same proportion because, as has often been explained in these columns, issuing more of an inconvertible currency than the economy requires for its transactions is tantamount to reducing its gold content. (All currencies, including inconvertible ones, are in economic reality related to gold, whether or not this relationship is legally recognised in some regulation or Act of Parliament.) If an inconvertible currency is defined as, say, one ounce of gold, and twice as much of it is issued as is required by the economy, then its definition will in economic practice change to being half an ounce of gold. All prices — expressed in units of the currency — will tend to double. This is purely a monetary phenomenon and, since governments have a monopoly in currency issue, one for which governments alone have ultimate responsibility.

Unfortunately, the word inflation has come to be used more and more loosely over the years so that it is now almost a synonym for simply ‘rising prices’. This usage is wrong. Inflation is not rising prices. On the contrary, a rise in the general price level is the result of inflation. The easiest way to grasp this is to remember that the word is short for ‘inflation of the currency’.

Oil Prices
The recent rise in the price of oil is merely a rise in the price of a particular commodity and not a rise in the general price level, which is unaffected by this change. All that has changed is the price of oil relative to other commodities. Those who have been buying oil now have to pay more and, if they want to continue buying the same amount, will have to cut back on their other purchases. No extra purchasing power — no inflation — is created; there is simply a re-direction of the previously existing purchasing power. This re-direction may be a painful process, since it means that demand for some non-oil products is going to fall, with inevitable bankruptcies and sackings in firms which will no longer be profitable enough. But whatever the result, it can’t be inflation, since that depends on the government. (Of course, if governments respond to the recent increase in the price of oil by printing more money to allow non-oil spending to continue at the old level, then the result will be a rise in the general price level, what is popularly called inflation. But the cause will not be the rise in oil prices but the government decision to print more money.)

The economic laws governing the incomes of those involved in oil production are similar to those governing incomes in agriculture as analysed by the classical political economists in the last century. According to their theory of differential rent, the price of an agricultural product like wheat is determined by its cost of production (plus average rate of profit) on the least fertile farmland in use. All wheat, even that produced on more fertile land, sells at this price. This means that tenant farmers of more fertile land make extra profits, which they have to pay over to the landlord as ground rent. The landowners are thus enabled to draw an income without having to invest any capital, let alone having to do any work, purely and simply because they monopolise a portion of the globe’s surface. The oil sheiks and, in other OPEC countries, the State which owns the land under which there is oil, are in the same position. Their royalties are a pure monopoly income paid them for nothing. (A qualification is necessary here: to the extent that they don’t spend all this windfall income in riotous living — and some of them try hard to — and invest a part in oil production, then a part of their income becomes profit, a return on the capital they have invested, and not differential rent. A part of their income, though, is always such rent.)

Since the cost of production of oil is cheapest in the Saudi Arabia area, the sheiks who monopolise the land there get the biggest free income, differential rent, royalty, monopoly profit, call it what you will, quite literally for doing nothing. This explains, incidentally, why Sheik Yamani can afford to be in favour of more ‘moderate’ price increases than some of his fellow price-fixers. All they have to do is to lounge about in their palaces waiting for the money to roll in — just like the landed aristocracy of Britain until the opening up of much more fertile wheat lands in North and South America during the nineteenth century deprived them of this privilege.

Absolute Ground Rent
Marx, in Volume III of Capital, identified another element in the income of landowners over and above differential rent, what he called ‘absolute ground rent'. This was the ransom the landlord class was able to extract from the rest of society — essentially, a diversion of surplus value from the capitalist class to the landlord class — by exploiting its position as the monopoliser of a limited natural resource, land. Such absolute rent can only exist where the landowners are well organised, where in fact they form a compact and relatively small group, as did the aristocracy in Britain in the nineteenth century. Today’s oil royalty owners are in a basically similar position. A relatively small group, the members of OPEC, has been exploiting its monopoly position to extract absolute ground rent from the industrial capitalist world. This is different from differential rent — which will come their way anyway, whether the OPEC cartel exists or not, simply as a result of the normal workings of the capitalist economy — and depends entirely on the balance of forces between the two sides.

As the world’s oil resources are used up, so the cost of producing oil — and hence its value and price — tends to rise in any event, since less productive wells and fields now have to be exploited. As the cost of production of oil rises, so, of course, the differential rent of the oil monopolists falls, an additional reason, no doubt, why the rulers of the OPEC countries are seeking to recuperate the loss of this part of their purely parasitic income by trying to increase the other clement in it, absolute ground rent.

This quarrel between the OPEC rulers and the capitalists of the industrialised world is not one that concerns the world’s workers. For, as our analysis has shown, it is essentially a conflict over the division of the spoils of the exploitation of the working class. When we describe the OPEC rulers as ‘parasites’ it should be clear that they are parasites on the world’s industrial capitalists. Since these latter are also parasites they’re the ones who directly exploit wage-labour for surplus value — the oil sheiks and other OPEC rulers are really parasites on parasites.

What happens to the surplus value the working class produce after it has been extracted from them by the industrial capitalists during the process of production whether or not these latter are forced to share some of the loot with some other group, and how much — does not affect the workers. But it vitally concerns the capitalist class. Which is why they have launched the current press campaign — with its racialist undertones and including the myth that rising oil prices cause inflation — directed against OPEC.

If the rent, absolute and differential, of the oil sheiks were reduced to zero, the working class wouldn’t gain a penny. But the capitalist class would, just as they did following the abolition of the Corn Laws in Britain after 1848 which enabled them to pocket a part of the surplus value which they had previously been constrained to disgorge to the landlord class as rent.
Adam Buick

Words, words, words . . . (1979)

From the September 1979 issue of the Socialist Standard
The following article is reprinted from the September 1954 issue of the Socialist Standard.
"I am told that people say I bawl. Well, I allow it, I do bawl and I will bawl." So said a famous tub-thumper of two hundred years ago, and in various tones, for various causes, they—we—have been bawling ever since.

Rhetoric under the sky is the oldest, most powerful form of persuasion. It was done in the agora, the market place that was the centre of social and political life in a Greek city. Petronius heckled an orator in Nero's Rome—"by a set of dribbling witticisms you found you could make audiences titter"—on his way to the bawdyhouse. In mediæval England John Ball stood on hillsides demanding freedom and justice for the poor. In Shakespeare's day news, scandal and sedition were put into ballads and sung in the markets, and old Saint Paul's was "the market of young lecturers, whom you may cheapen here at all rates and sizes"; Mark Antony—and his audience—had their prototypes. Through the centuries that followed, in the squares and open spaces they cried salvation and the rights of man—the revivalists, the Chartists and the rest.

The Socialist Party was founded when open-air meetings had never been more copious, when the sects and parties vied with one another in the streets for the attention of the working class. Different conditions engender different approaches. There was more rhetoric in those days—to the modern mind more "ham" perhaps, but it was necessary. The slick, confidence-making political speech belonged to the wireless-telegraph future. Aspiring speakers, practising declamation, tried "The Charge of the Light Brigade", "Men of England" and "The Bells" on one another.

Politically conscious people were more theory-conscious that they are to-day. Marx and Engels were not long dead, Kautsky, Luxemburg and Plechanov in their prime; Bernstein's revisionism and the Fabian Essays were argued fiercely. Socialist speakers had to know their theory and know it well. Many of them learned by heart what were considered key passages of important works: sections of The Communist Manifesto, the statement of historical materialism from The Critique of Political Economy, pages of Capital, of Darwin, Spencer and No Compromise, and bits of Shakespeare too. It was a fine thing to support the analysis of capitalism with
" . . . You take my life
When you do take the means whereby I live."
If the politicos were more learned, the others made up for it. A speaker too vigorous in attacking the prejudices of a prejudiced audience was asking to be thrown in a horse-trough, and not uncommonly he was. Robert Tressell describes the reception of a "Clarion" van by the ragged-trousered philanthropists of Hastings:
  "The man on the platform was still trying to make himself heard, but without success. The strangers who had come with the van and the little group of local socialists, who had forced their way close to the platform in front of the would-be speaker, only increased the din by their shouts of appealing to the crowd to 'give the man a fair chance.' This little bodyguard closed round the van as it began to move slowly downhill, but it was completely outnumbered . . . 'We'll give the swines Socialism!' shouted Crass, who was literally foaming at the mouth." 
On most platforms, feeling carried the day. The Liberals and Tories could raise cheers with reference to the Empire and the Flag; the worst accusation against a policy was "it will ruin the country". Emotion was not altogether disfavoured by Socialists. Words like "traitor" carried a great deal; labour leaders were invariably called "Labour bleeders" or "fakirs", and there was even a Party song called "The World for the Workers".

The platform manner changed after the first war, at the same time as urban growth and road traffic began to eliminate meeting-places. The radio and the pictures arrived, and speakers had to compete with them. Some of the smaller parties were swallowed by the Labour and Communist Parties, so that theoretical argument gave place to "practical policies" and calls for "action now." In the thirties a new sort of political meeting appeared, with the speaker surrounded by microphones and no questions allowed. The rhetorical tradition of Parliament, too, suffered a blow when Labour came to power with Cabinet Ministers who were without oral grace; Gladstone, Balfour and their contemporaries could often be taken down verbatim to read as excellent prose.

Today audiences are more tolerant (and more knowledgeable too) and speakers, on the whole, more urbane and more discursive. Perhaps there are more wisecracks and fewer long quotations, because our age prefers the former as a condiment to learning. One tradition which the Party has always maintained is that of giving the platform to opposition. Other parties don't do it; the Socialist Party, which has everything to gain and nothing to fear from open discussion, never refuses, and many a truculent opponent has deflated himself trying to present a case against Socialism under the Socialist Party's own auspices.

The industriousness of Party speakers has always been remarkable. Before the first war, two dozen of them held something like a hundred and thirty open-air meetings a month in London alone. The numbers were similar in 1939, and today the meetings still are a vital part of the Party's propaganda. Debates, too: Liberals, Labour, Tories, Communists, pacifists, fascists, parsons, anarchists—all of them have had their petty panaceas atomized by Socialist speakers. Several debates were published as pamphlets, and they are remarkable examples of the Party's case in action.

Fifty years' speaking for Socialism—fifty years of writing for it, as well. The Socialist Standard is unique. It has never known a paid journalist; its writers and editors have been bricklayers, clerks, housewives, busmen—all sorts and conditions of working people in their spare time. The first page of the first issue said:
  "In the Socialist Party of Great Britain we are all members of the working class, and cannot hope that our articles will always be finely phrased, but we shall endeavour to lay before you on every occasion a sane and sound pronouncement on all matters affecting the welfare of the working class. What we lack in refinement of style we shall make good by the depth of our sincerity and by the truth of our principles."
The Standard was too hard-hitting to have such refinement, and there was little room for fine phrases in Fitzgerald's relentless logic or the rumbustious onslaughts of Jacomb. Euphemism was scorned, and the contributors said just what they meant. When the Manchester Guardian slighted the Party, a Standard headline called it the "Liberal skunk press"; Lloyd George was a liar. Asquith an assassin, and their confreres hypocrites, frauds and political prostitutes. It seems that surprising that the Party was sued for libel only once.

The style of the Standard then, as now, owed to two principal sources: the sociological textbooks of the time, and popular journalism. From the latter it drew a peculiar Joe Miller waggishness that was part of the stock-in-trade of successful newspaper columnists, easier to exemplify than describe. Thus, the Editorial Committee apologizing for a writer who had not made himself clear to a correspondent: "He developed what he calls his style by studying a burr-walnut piano case in foggy weather". A debate with a suffragette was irresistible, and its report was resplendent with quips about "ye gallant knight Anderson" and "the poor girl". Perhaps the acme of this sort of wit was with a highly dramatic poem which had the refrain:
"Go! reckon your dead by your forges red,
  And in factories where we spin;
If blood be the price of your cursed wealth,
  By Christ! we have paid in full".
The poem was called "Gawd Struth We Have."

The writers on economics, socialist theory and political issues put forth their subject-matter lucidly and without frills or ambiguities; style which came naturally through close acquaintance with Engels, Kautsky, Plechanov and the other classical exponents of Marxism. The popularization of academic and technical subjects influenced later writers, and is still doing so—"science for the citizen" has made its mark. Just as on the platform, the people addressed are more widely informed and less concerned with theoretical questions. That does not mean, however, that the modern writer—or speaker—may neglect theory; it means that he must apply it more widely in a world with wider horizons.

And so it goes on; the business of persuading people to think straight, because that is what the Socialist wants. Words are our weapons. Words, words, words . . .
Robert Barltrop

The Holy Pancake (1979)

From the September 1979 issue of the Socialist Standard

Competition is stiff in the icon stakes. Apart from the Turin Shroud, there is the Holy Pancake. This Beatific Flapjack surpasses your ordinary common or garden Eucharist in which the Blessed Trinity (all one of them) appear in the form of a biscuit, for imprinted on the dough of this specimen are the facial features of The Carpenter himself. It arrived in the frying pan of a devout Catholic woman in the United States, and has not putrified in months. The Miraculous Chapati is said to have healing properties: her husband, who had a drink problem, has not touched a drop since he saw The Countenance!

Letters: Women Workers (1979)

Letters to the Editors from the September 1979 issue of the Socialist Standard

Women Workers

Following discussions with a member of the SPGB, I perceive a contradiction in the Party’s approach to the struggle to bring socialism.

The Party acknowledges and encourages the struggle of all workers to win higher standards of work and life, although the ultimate goal of workers must be the abolition of wage labour. Many things stand in their way. For women workers, in particular, enforced childbearing has been the single greatest barrier in their fight for better employment, better education and leisure. Why then has the Standard been silent on the struggle of women to achieve this particular revolution in the quality of their life and work to win free contraception and abortion on demand?

Your lack of interest in this workers’ movement (as confirmed by a three-year avoidance of this or any other issue important specifically to women in the Standard) suggests that you either deny or do not understand its centrality. If either is the case, then the SPGB must lose credibility with women workers who fight to build socialism in their own lives.

But perhaps I have been misled by your spokesperson.
Verna Smith
London WC1

You rightly point out that the Socialist Standard has not dealt with free contraception or abortion on demand (except for a general article on the women’s movement in the November 1978 issue) for the past three years, but it is something which will be analysed in a forthcoming issue. Regrettable though this absence (not avoidance) is, we claim that the basic message of our journal — the abolition of the wages system — is the ‘central issue’ for all workers.

Our aim is free access to all that society produces; socialism will obviously make available means of contraception and abortion. But we do not support campaigns to ‘demand’ these. To do so would attract support from non-socialists people interested in reforming capitalism rather than abolishing it. In any case what you must ask yourself is whether these are realisable aims under capitalism. Suppose these services are provided — a possibility, since it would be in capitalism’s long term economic interest despite the initial costs. Do you think they would be any more adequate than the other inadequate ‘free’ health services which allow people to die waiting for them? Or do you think they would remain immutable rights at times, such as now, when the inevitable crises of capitalism force governments, of whatever name, to introduce cuts in ‘social’ or ‘health’ services?

Since capitalism operates only on the basis of providing goods and services according to cost/profit considerations, surely it is capitalism which is the ‘single greatest barrier’ to women workers — as well as to men. The removal of this barrier should be the immediate goal of all of us.

Inflation and Crises

In the article ‘Brave New Tory World?’ (Socialist Standard, July) your writer mentions that governments can control inflation. Can you explain how they do this and how inflation relates to the crises and depressions mentioned which governments cannot control?
P. J. Simmons
Hayling Island, Hants.

Governments cause inflation by putting into circulation an excess amount of currency (notes and coin). This was prevented in nineteenth century Britain by the gold standard, which linked Bank of England notes to gold. By law, the notes were convertible on demand at a fixed rate (£1 represented about a quarter of an ounce of gold). At a given level of production a certain amount of gold-linked currency is needed; if it is replaced by inconvertible paper currency of a large amount, prices rise accordingly. Wherever and whenever such excess issue has taken place inflation has resulted; wherever and whenever governments have restricted the issue of currency, prices have stabilised or fallen. A rise in the general price level is not synonymous with, but the result of, inflation.

Crises and depressions, on the other hand, are endemic to the capitalist mode of production and unrelated to monetary factors; they are the consequence of conditions in the field of production and marketing, or basically, of the class ownership of the means of production and of production for sale and profit. While every company is planning to sell its products in the world market, so are similar companies and governments in every country. They do not know the size of potential world demand for all their products, and they know still less about the total supply there will be when these unrelated plans for expanded production are completed. They hope for a profitable share of the market, but they cannot know. They all gamble on the future. And every now and then the gamble produces chaotic conditions that disorganise all markets and slow down all production.

Governments have thought, mistakenly, that printing more money (inflation) could reduce unemployment and avoid slumps . .. but that’s another question.

World View

I was interested in the reprint of parts of Un monde sans argent: le communism (July 1979).

It is possible, as you suggest, that the authors may have developed their ideas independently of the SPGB. Capitalism, to say the least, tends to give rise to its opposite, and there have been small groups of ‘socialists’ advocating a free, stateless, moneyless world in France and some other European countries for decades.

Nevertheless, tiny as the SPGB is, I know of French workers familiar with it. Indeed, a friend of mine who lives in Paris has in her library a copy of Philoren’s Money must go, and for over two years she lived and worked in a hospital only a stone’s throw from Clapham High Street!

If the group — if it still exists — envisages a non-parliamentary establishment of socialism, they may in the end be correct; all I am prepared to say is that it can only come about on a world scale by a majority who have a fairly good idea of what it will involve and, most important, desire such a society. Speed the day!
Peter E. Newell 

A Rocky Horror Show for the Left (2020)

Book Review from the September 2020 issue of the Socialist Standard

Mapping the English Left Through Film by Ian Parker (Folrose. 2020.)

Older readers may remember an amusing pamphlet from the 1980s called As Soon as This Pub Closes . . . which was a wry (and largely accurate) commentary about the main groups on the British far left. This short book from Trotskyist Ian Parker attempts to do a similar thing, but with the twist that the various groups and parties are deconstructed in relation to a film that is claimed encapsulates their methods and objectives.

In fairness it’s a neat idea, but it’s difficult not to come to the conclusion that it might have been better done by someone else – someone who can a) write well and b) who has rather fewer axes to grind. It is subtitled ‘25 uneasy pieces’ and this is a more rounded and accurate description than perhaps the author intended. The sloppy production hasn’t helped matters either.

There seems to be a sneaking admiration for the Trotskyist-Feminists of Revolutionary Socialism in the 21st Century (RS21) but all others get short shrift, including naturally enough, ourselves in the SPGB, ideologically ‘mapped’ through the film Lars and the Real Girl (2007). The discussion of the SPGB seems largely to have been adapted from points made from our entry in Wikipedia, and claims we have a particular vision of socialism that we cling to like a doll.

It also claims we have a ‘dwindling membership’. It’s difficult to see where this comes from (perhaps it’s just wishful thinking) but nevertheless the 25 chapters are said to be ordered in sequence according to the author’s personal perceptions of the organisational size and influence of the parties and groups concerned. This sort of approach is always asking for trouble. Indeed, it’s not clear why on that basis Socialist Appeal appear several chapters before the Socialist Party of England and Wales (SPEW), as the latter – effectively the parent organisation – is obviously several times the size and prominence of the former, whatever else we might think of them.

The SPGB is once again derided as the ‘Small Party of Good Boys’ (yes, the book is that funny) and, while you’d never know from this text, is actually larger than all the left-of-Labour groups listed aside from the SWP, SPEW and CPB. So the fact we appear in the ‘running order’ behind the likes of Workers Power, the RCG and the somewhat mysterious Plan C probably says rather more about the author than it does about us. In particular, the obsession Trotskyists everywhere seem to have with leadership cults, would-be leaders and manipulators of the masses.

Talking of which, it is also telling that while the small band of relentless media whores from Spiked achieve prominence (presumably because of their regular appearances on the Sky Newspaper reviews defending whatever contrarian ideas are in vogue this week) there is no mention anywhere of the recent significant interest in Fully Automated Luxury Communism. But then again FALC is without doubt nearer to the SPGB’s view of socialism than anything else presented here, and that would be to open up a veritable Pandora’s Box (1929) for the latter-day followers of old Leon.

Crime and Capital (2020)

From the September 2020 issue of the Socialist Standard

Private enterprise pays
At the beginning of July, it was loudly trumpeted in the media that hundreds of people had been arrested in operations across Europe. It was a directed strike at organised crime groups, enabled by French police compromising the communication servers of a company called Enchrochat, which offered secure encrypted communications. Believing themselves safe from police surveillance the criminal entrepreneurs using its services were caught planning drugs deals, kidnappings and murders.

The enterprises engaged in drug production on an industrial scale. Police uncovered ‘19 meth labs, 1,200kg of meth and 10 tons of cocaine’ (LINK). This industrialism is complemented by the horrifying fact that Dutch police found a shipping container that had been converted into a soundproofed torture chamber, complete with a chair to strap victims into.

Enchrochat charged £1,500 for a 6 month contract with its dedicated handsets, and it’s believed that 10,000 people in the UK availed themselves of its possibilities, out of 60,000 worldwide (LINK). The law enforcement agencies consider that this was a bespoke service for criminal enterprises, used by middle tiers and upwards of organised criminals. So this set of police raids, which have netted 800 arrests (so far) has also revealed the extent of organised crime.

Although those numbers sound large on their own, what they reveal is how small the organised criminal underworld really is, and how efficient their business is for so small a number to cause so much pain and mayhem. Just as with most other enterprises, modern industrial technology has increased the productivity of those whose output is crime.

The raids in the UK amounted to over 700 arrests, netting £54 million in cash. This is, though, not the full value of these businesses.

These are early days, and the state agencies have a vested interest in saying everyone who used these machines was a criminal (as opposed to legitimate business people with a need for privacy). What these events show, though, is the professionalisation of crime. Indeed, the root cause of crime is free enterprise, and entrepreneurs would be foolish not to make the best use of available technology to spread their businesses. They co-operate across borders with business partners (the press called them ‘gangs’) in other countries.

Like any other business, they need to co-ordinate their activities, and although this co-ordination remains hidden most of the time, this communication was used in this case to smash their organisations. They also need secrecy, lest their competitors take their markets from them (their competitors including capitalist businesses that are ‘legitimate’ and use the law to make their money rather than breaking it). Like the criminals, the police advanced their use of technology. As Joseph Cox (also at Vice) explained, there was:
‘…malware on the Encrochat device itself, meaning that it could potentially read the messages written and stored on the device before they were encrypted and sent over the internet’ (LINK).
Enchrochat themselves boasted that nothing was stored on their servers, and that their phones had an easy wipe feature. The malware prevented wiping and stored passwords.

The loss of Enchrochat has temporarily broken the bond of trust needed to engage in this type of business, but new encryption services are coming forward, and the criminal enterprises will learn and return to their pursuit of wealth and profit without restraint at the first opportunity. After all, isn’t that what capitalist ideologues tell us all to do: fill your boots?

Pandering to the wealthy
Similarly, a criminal enterprise broken apart by state action is Jeffrey Epstein and his associates. His ‘little black book’ of contacts has been released and while, it should be stressed, there is no reason to think any of the names listed in it are connected with his sex crimes, it is an interesting insight into the connectedness of the rich and powerful (LINK). Just as criminal gangs organise in international networks, so too do supposedly legitimate businesses.

Jeffrey Epstein famously committed suicide in prison (under murky circumstances that led many to claim he was ‘suicided’). He was convicted of sex trafficking, as his Wikipedia article relates:
‘Epstein pleaded guilty and was convicted in 2008 by a Florida state court of procuring an underage girl for prostitution and of soliciting a prostitute. He served almost 13 months in custody, but with extensive work release. He was convicted of only these two crimes as part of a controversial plea deal; federal officials had identified 36 girls, some as young as 14 years old, whom Epstein had allegedly sexually abused’.
His initially lenient sentence after the plea deal was attributed by many to his having influential friends.

He was a wealthy financier from a modest background. He gained wealth in the ‘80s as a Wall Street trader. Steven Hoffenberg, who served 20 years in federal prison, claims Epstein was a co-conspirator in his fraud, and yet he was not charged. He moved in to managing the investments of the truly wealthy.

 He used his wealth to pander to other wealthy and powerful men. It is interesting to see who was willing to be a recipient of his largess, flying on his private jet – rather tastelessly nicknamed ‘the Lolita Express’ (apparently because of the number of teenage girls it flew to his private island). The list of those who flew on the jet included Bill Clinton, Donald Trump and Andrew, Duke of York. Epstein’s contact list included Prime Ministers like Tony Blair (of course, this just means he knew their contact details, not that they had been in contact).

At his death, he possessed $112 million in investments, $56 million in cash and was worth an estimated total of $577 million, including his Caribbean private islands. As a fund manager he made his wealth looking after billions of dollars of other people’s money. To that end, his luxurious lifestyle was part of his means of impressing clients and potential investment partners.

That lifestyle included using his wealth to obtain and sexually abuse young women and girls. While still alive he settled a string of lawsuits with pay-offs. There are allegations he provided girls to his contacts (LINK). More will come out, doubtless, in the upcoming trials of his associates.

Like the Enchrochat criminals, wealth and respectability came to him from the proceeds of criminality. Like the, state intervention shows how the powerful and wealthy organise and connect to each other. The wealth stolen from our labour funds these lavish lifestyles. For the truly wealthy, the law becomes optional, and it took particularly egregious behaviour from Epstein to even get a slap on the wrist.

The connection between his world and the Dutch torturers is wealth and ego turning into impunity: wealth, secrecy and power go hand in hand which in turn enables criminality. Billionaires do not need a lift on a friend’s jet, but they like the flattery and affirmation.
Pik Smeet

Population growth: women choose (2020)

From the September 2020 issue of the Socialist Standard

For centuries, women have been denied the opportunities for personal advancement in the name of religion and tradition. Religious and cultural institutions where patriarchal attitudes were legitimised have had a deep effect on the role and status of women. Yet it is now women who are the key drivers in defusing what was once popularly called the ‘population bomb’. Everything has changed so much that choosing to have no children, or just give birth to one child, is for women just as convenient as choosing to bear two or three.

Globally, the fertility rate – the average number of children a woman gives birth to — is falling below the replacement level and this means nearly every country could have shrinking populations by the end of the century, based on the expectation that women will have fewer children. This does not mean the number of people living in these countries is falling, at least not immediately, as the size of a population is a mix of the fertility rate, death rate and migration. It can be a generation before changes in fertility rate take hold. Although fertility rates continue to fall the world population will continue to rise because the fall in fertility rates takes a while to show up, a phenomenon known as population momentum.

Falling fertility rates go hand-in-hand with better education and more career openings for women and the access to contraception and abortion. When more infants survive, fertility goes down and population growth draws to an end.

The more secure and prosperous people become, the lower will be their family sizes.

According to Wolfgang Lutz, of the Vienna University of Economics and Business, one reason for the fertility decline is women’s education:
‘The brain is the most important reproductive organ,’ he explains. Once a woman receives enough information and autonomy to make an informed and self-directed choice about when to have children and how many to have, she immediately has fewer of them and has them later.
Paid to reproduce
Some countries are so concerned about their shrinking populations and fear of the alternative – a policy of immigration – has led nationalist and xenophobic leaders to introduce policies that could only be described as a return back to an earlier time when women were viewed as baby-producing machines. Across Europe, governments have introduced benefits aimed at stimulating population growth, implementing baby bonuses for each new child and promoting ‘traditional family values’.

Victor Orban of Hungary is heavily investing in such things as cash loans to young married couples. Each time a child is born, payments are deferred. If the couple have three children within the requisite time frame, the loan is completely written off, otherwise they have to pay it back. Government IVF clinics will offer free treatment for all women who want them (just as long as they are under 40 and not lesbians). In Poland, the ruling Law and Justice Party introduced the 500+ policy in 2016, under which mothers received 500 złoty (£99) per child per month from the second child onwards, later expanded to include all children. Russia launched a one-off payment of £5,800 to families with two or more children, with Putin explaining that ‘Russia’s fate and its historic prospects depend on how many of us there are, it depends on how many children are born in Russian families.’

Sweden is one country that used a package of policies including childcare, flexible working conditions and generous maternity and paternity leave packages to reverse its population decline. But the increase to the fertility rate was marginal – just 0.2 children per woman.

As Wolfgang Lutz points out, ‘Once a woman is socialised to have an education and a career, she is socialised to have a smaller family. There’s no going back.’

Fertility rates
Just as the Catholic Church’s anti-contraceptive dogma was blamed for rises in population only to be punctured by women defying their priests, the argument switched to the Muslims, with its emphasis on strict traditional hierarchal gender roles, and it would be they who would go against the trend of smaller families. But then fertility rates in majority-Muslim countries such as Iran, Bangladesh and Indonesia fell, as well.

Now the blame for over-population has shifted to sub-Saharan Africa, suggesting that African high fertility rates with four or more births per woman will not buck the trend and cause over-population. But even here, there are signs of change in a growing number of countries.

Countries such as Nigeria which are struggling to make progress to provide education and employment opportunities and provide quality healthcare should be seen as the last hold-outs against the global triumph of small families.

International agencies found that over 20 percent of women in this region of Africa want to avoid a pregnancy but have their needs unmet by any family planning outreach. It results in almost 20 million — or 38 percent — of the region’s pregnancies each year being unintended. The World Health Organization estimates that globally 270 million women who want contraceptives have no access to them.

Practices such as early marriage, which is associated with an early start to child bearing, are common. In sub-Saharan Africa, approximately 38 percent of women are married by the age of 18. In Niger, three-quarters of girls marry by the age of 18. Child marriage denies girls an education which leads to a lack of ability to find work in later life and so handicaps girls’ decision-making power and their right to choose.

The gap between desired and actual family size suggests that women are not fully able to realise their reproductive rights. But choice can become a reality everywhere, including the African continent. In the past, women in Botswana would have seven children on average. Now they have fewer than three. It was accomplished by enabling women to control their fertility and reducing child mortality rates – moves that almost inevitably lead to them having fewer babies. When more girls attend school, a country’s adolescent fertility rates dip, more women wait until adulthood to have children and are armed with much more sophisticated knowledge-tools to make better decisions for their health and future offspring.

It took the UK 95 years to drop from a fertility rate of six children per woman to three, but it took Botswana only 24 years, Bangladesh 20 and Iran only ten years.

Blaming our environmental problems on population pressures is all too common among eco-activists and it has resulted in a sordid history of top-down population control programmes violating women’s reproductive rights with such measures as uninformed sterilisations. All women should have full access to contraception and safe abortion as part of overall health services. Family planning, however, is not the answer to our environmental problems. Babies and yet-to-be-born babies are not responsible for today’s environmental problems. Reducing population numbers will not stop climate change, nor rising sea-levels. Many environmentalists will cite the fallacious carrying capacity in their argument that we have too many people on the planet but the over-emphasis on individual consumption distracts from industrial and military consumption. Capitalism is the reason for ever-increasing resource depletion, CO2 emissions, waste and pollution. It should be held accountable, not the innocent victims of global warming.

More people bring more ingenuity, more talent and more innovation into the world. Every human born is not just an extra mouth to feed but also another pair of helping hands and an additional thoughtful brain. Yet we are being told by environmentalists that it means less for each of us. We get informed that we will need to radically reduce humanity’s carbon footprint on the environment by reducing our numbers, as well as changes to our lifestyles and that until the world’s population stops growing there will be an urgent need to squeeze people’s consumption.

Does pushing population growth down actually put the environment on a more sustainable path? And if so, what measures would the policy makers have to apply to actually bring about such a change?

The answer to environmentalists attracted to the over-populationist argument is that the birth-control campaigns are, in the end, just one more patriarchal attempt to control women’s reproduction, and that improving child survival rates, giving girls access to education, and empowering women to control their own reproduction (and that means allowing women themselves to make their decisions) are what will sustainably and non-coercively lower birth rates. Family planning and reducing family sizes, however, is not the answer to our environmental problems.

Environmentalist focus on population is mistaken and can lead to equally misguided action. Over-population is a thinly veiled misogynist racist myth that is accepted by both right-wingers and progressives alike. People who claim to be against genocide and eugenics push this myth with no sense of the irony. Those accepting the over-population argument obscure the more immediate causes of suffering under capitalism. Because of its short-termism, its unrelenting drive for profits, and international conflict, capitalism expresses a tendency toward planetary crisis, regardless of the total number of humans living on earth. The amount of waste and pollution under capitalism is enormous with its preponderance of the production and distribution of useless products, the wasted labour and the creation of mounting piles of garbage as a result of planned obsolescence and single-use products.

The concentration on so-called over-population confuses symptoms with causes, validating apologists for the system and perpetuating Malthusian anti-poor arguments. The central concept in the ideological armoury of capitalism is the idea that there isn’t enough to go around. Hence, we are confronted with the idea that there isn’t enough food, aren’t enough jobs, not enough housing, or we haven’t enough classrooms or hospital beds because there is a certain fixed amount of all these things. People who claim that population growth is the issue are shifting the blame from the rich to the poor.

Those who believe reducing the population to be an answer to global warming say very little about which policies would spare the planet many more billions of people, particularly when the existing trend is already towards smaller family sizes. We should forget all about prioritising population control and instead help each and every woman bear a child in good health whenever she chooses to have a baby. It might sound counter-intuitive for stabilising and lowering the population but giving women control over their lives and of their own bodies controls population growth. We need no more misanthropic pronouncements about too many people or that humanity has somehow exceeded the planet’s carrying capacity or that humanity is a parasitic species on the Planet Earth’s ecology.

Giving women control of both their lives and their bodies is what will control population growth. The best family planning and contraceptive is the empowerment of women.

‘I’ve Got Nothing. I Ain’t Got No-one. But I’ve Got The Shops’ (2020)

The Proper Gander column from the September 2020 issue of the Socialist Standard

The High Street was already on the financial skids before the pandemic, which has sped up the shift to online shopping. And these days, going to the shops has the added considerations of facemasks, social distancing, arrows on the floor and sanitisers by the doors, making it more of an ordeal than before. Despite all this, slick, brightly-lit shopping malls are still there to tempt those looking for either retail therapy or a five-finger discount. The latter were the focus of Channel 5’s recent Shoplifters: At War With The Law. This fly-on-the-wall documentary series follows the security guards and their quarries at two interchangeable shopping centres: West Orchards in Coventry and Weston Favell in Northampton. It was filmed pre-Covid 19, so since the cameras left, the guards are presumably on the hunt for people not wearing masks as well as people not paying.

According to the programme’s voiceover, last year, there were 400,000 shoplifting incidents reported nationwide, with the number of those that go undetected estimated to be 20 times higher. Of course, we don’t see any of these, and the shopping centres understandably want the programme to emphasise the chances of getting nabbed. Regardless of this, the show has plenty of tips for would-be pilferers, such as going with a group of friends to distract the guards while items are slipped into pockets elsewhere. And higher-end goods with electronic tags attached can be dealt with by snipping them off with pliers or hiding them in a bag lined with foil so they don’t set off the door alarms.

Watching out for all this are hundreds of HD CCTV cameras, whose footage is relayed back to each shopping centre’s control room. When the guard on duty there sees someone acting shiftily or gets a tip-off from one of the shops, they can radio down to their colleagues to find their target. It’s all quite sad to watch this game of cat-and-mouse, although a couple of the guards get a kick out of their work. ‘I always catch my prey,’ boasts one, ‘that’s why I do my job. I love it’. The guards can only apprehend someone once they’ve left a store, although they cynically assume ‘anybody that’s in the shop is a shoplifter until they go to the till’. Those who are caught are led to a bleak holding room to be questioned and have their bags searched. The police will be called if the person has ‘gone equipped’ with a foil-lined bag or pliers, or if what they have stolen is valued at over £200. If the goods are worth less than this the police won’t usually be involved and instead, a year-long ban from the shopping centre is issued. If the accused says they have no ID, they’re asked to bring up their social media profile instead. Their name, address and date of birth are taken, as is a mug shot for the database. If they are seen to return to the centre, they will be trespassing and the police will be called. The guards have had plenty of practice with the procedure: the West Orchards team ‘take down’ up to ten shoplifters a day, as they put it.

The programme-makers blur out the faces of the people caught, which also has the effect of emphasising how dehumanising the need to shoplift is, and the rituals around it. Some of the people featured have been recruited by gangs, and probably have very little choice in the matter. They tend to be from Eastern Europe, not able to claim benefits and without much chance of securing better paid work, which makes them vulnerable to exploitation from organised gangs. Most of the value of any successfully shoplifted goods is likely to go to the gangmasters, with those who take the risks receiving little back; a more extreme version of mainstream employment. These gangs tend to move between areas once they become too well-known in one place. Nearly three quarters of shoplifting in West Orchards is carried out by a small group of local repeat visitors. Many of these are homeless, with or without a benefit claim, either stealing to get enough food or to fund a drug habit. One man speaks to the camera crew after he’s thrown out for the umpteenth time: ‘I’ve got nothing. I ain’t got no-one. But … I’ve got the shops.’ The guards tend to treat those who are pushed into shoplifting by poverty with some sensitivity, as long as they don’t get lairy.

But Shoplifters: At War With The Law doesn’t want us to feel too sympathetic towards people who steal. Its voiceover makes the point that shoplifting ‘takes more than £2 million out of tills every day’, and that to make up for these losses shops have been ‘ramping up prices for millions of honest shoppers’. It’s easy to claim that theft raises prices, but this falsely implies that retailers would lower prices below the market rate if people stopped stealing, which of course no retailer would ever do, so it just scapegoats people who shoplift and provides an alibi for inflated prices. The costs of security measures and stolen items do impact on the profitability of goods to some extent, so the chain store owners will be keen to clamp down on shoplifting. But a few pinched bottles of perfume or boxes of chocolates are nothing compared to the billions of pounds creamed off by owners and shareholders.
Mike Foster

A is for Alpha (2020)

From the September 2020 issue of the Socialist Standard

The UK news media always has a bun fight over the annual August A-level results, but this year’s turned into a bigger furore than usual. With schools closed due to Covid the exams had to be replaced by estimated grades based on the students’ but also the schools’ track records, in order to replicate the year-on-year average. Objections rapidly mounted that this ‘locked in’ existing biases which excluded talented outliers and underprivileged schools that had previously been making fast progress. When Scotland decided to rely on teacher assessments instead, predicted grades shot up well beyond what would normally be expected. Because of this well-meaning but blatant teacher bias, England refused to follow suit, prompting an even bigger row (BBC Online, 14 August –

It was an intriguing conundrum for the statisticians. There was no way to estimate grades that could be judged ‘fair’, because no algorithm could account for all biases and assumptions. But who says exam systems are fair anyway?

While disappointed students loudly complained about how they were ‘let down by the system’, and leftist opportunists immediately started screaming about ‘justice for students’, nothing was heard from the probably equal number of students who found themselves with better grades by not sitting the exam than they would have got if they’d sat it.

What everybody overlooked in the furore was that, of all the ways to assess what somebody knows about a subject, a competitive exam is probably the worst and the cruellest. Exams aren’t a test of knowledge, they’re a test of nerves.

Some students are ok with the exam regime. They’re the Alphas, just like in Huxley’s Brave New World, cool, collected, well-adjusted, organised, and able to cope with competitive stress. They’re most likely supported at home by motivated and well-off parents too. The exam system works for them just fine. In fact, it’s designed for them.

But it doesn’t work for those who dread exams like the dentist, the ones who don’t get the emotional support, the private tuition, the helicopter parenting, the ones who come from poor backgrounds and grow up thinking that education’s wasted on them, that they’re just silly, stupid girls or boys and that they’ll never amount to anything. Their main obstacle in any exam is fear of the exam itself. It doesn’t matter what they know or how smart they are because they fall to pieces whenever they open an exam paper.

But that’s also a victory for capitalism, because what keeps the system fit and trim is a working class who won’t fight back because they’ve been labelled as losers and so they spend their entire lives blaming themselves for not measuring up.

Capitalist education isn’t really education, it’s a factory system for workers that has no regard for their hopes or passions as it shunts them along its inhuman conveyor belt into its inhuman mincing machine. This year, at least, some of them might have got a free pass because the belt broke.
Paddy Shannon

The Referendum – Where We Stand (1997)

From the September 1997 issue of the Socialist Standard

A Parliament for Scotland? An Assembly for Wales? Unable to agree among themselves and afraid to go ahead without popular support–last time they put this to a referendum their proposals were thrown out–our rulers have decided to ask us our opinion on the matter.

We should be flattered, but don’t be fooled. These proposals are part of a smokescreen to disguise the fact that the Labour Party cannot deliver, and no longer wants to deliver, social reforms aimed at shifting wealth and power from the privileged few to working people.

Labour has always accepted the profit system. They used to believe they could humanise it by social reform legislation. Not any longer. Bitter experience has taught them that where reforms and profits come into conflict, it is reforms that have to give way. The last Labour government under Callaghan ended up applying this and Blair had promised to do the same even before he became Prime Minister.

The Labour Party fully accepts now that priority has to be given to profits and no longer promises more spending on social reforms. But, to distinguish itself from the Tories, Labour still wants to retain a reforming image. But how? By finding reforms which don’t come into conflict with profits. Constitutional reforms fill the bill perfectly. They don’t interfere with profit-making. They don’t cost more money. And they give rise to an illusion of change.

It is in this light that the Labour government’s proposals for a Scottish Parliament and a Welsh Assembly should be seen, along with their proposals for turning the House of Lords into a huge non-elected quango and for elected mayors and other such gimmicks. But it’s all completely irrelevant as far as ordinary people are concerned.

Constitutional reform is of no benefit or relevance to us. It leaves our lives and the problems the profit system causes completely unchanged. Exploitation through the wages system continues. Unemployment continues. A crumbling health service, a chaotic transport system, a polluted environment, failing schools, rising crime and drug addiction and the general breakdown of society all continue. As far as solving these problems is concerned, constitutional reform is just a useless irrelevancy.

Deficient Democrats

Naturally, Labour wraps its irrelevant, constitutional reforms up in democratic rhetoric. Elected assemblies in Edinburgh and Cardiff, we are told, would be an extension of democracy, bringing power nearer to the people, so how can Socialists not be in favour of this?

Yes, Socialists are in favour of democracy, and socialism will be a fully democratic society, but full democracy is not possible under capitalism. Supporters of capitalism who talk about “democracy” always mean only political democracy since economic democracy–where people would democratically run the places where they work–is out of the question under capitalism, based as it is on these workplaces being owned and controlled by and for the benefit of a privileged minority.

You can have the most democratic constitution imaginable but this won’t make any difference to the fact that profits have to come before meeting needs under capitalism. The people’s will to have their needs met properly is frustrated all the time by the operation of the economic laws of the capitalist system which no political structure, however democratic, can control.

It is not imperfections in the political decision-making process that’s the problem but the profit system and its economic laws. And the answer is not democratic reform of capitalism’s political structure but the replacement of capitalism by socialism.

As a society based on common instead of class ownership of the means of production, socialism will fulfil the first condition for a genuine democracy. Because it will be a classless society without a privileged wealthy class everyone can have a genuinely equal say in the way things are run. Some will not be more equal than others, as they are under capitalism, because they own more wealth. Socialism will be a society where the laws of profit no longer operate since common ownership and democratic control will allow people to produce to meet their needs instead of for the profit of a few as today.

The argument about elected Scottish and Welsh assemblies bringing power nearer to the people might have something in it if, even within the limited context of mere political democracy, the proposed assemblies were going to have some real powers.
But they are not.

All their money is to come from the central government, and the only “power” they will have will be to rearrange slightly how the limited amount of funds they will be given is to be spent. In other words, they will have no more power than existing borough and county councils.

They will be part of the administrative arm of central government and their members will be no more than elected civil servants spending central government money. All that would happen would be the introduction of another layer of elected bureaucrats. Another trough for the professional politicians to get their snouts into perhaps, but ofno significance to ordinary people.

If our rulers want to reform the machinery of capitalist government in this way, that’s up to them. But spare us the pretence that it’s some great extension of democracy.

Nasty Nationalists

Also urging a “yes” vote are the Nationalists of the SNP and Plaid Cymru. They see the sham parliament with token powers that is on offer as a step towards their goal of an independent parliament with full powers to impose taxes and make laws.

This argument for voting “yes” cuts no ice with Socialists either. We are not nationalists–in fact we are implacably opposed to nationalism in whatever form it rears its ugly head–and we see the establishment of an independent Scotland or Wales as yet another irrelevant, constitutional reform. One of the last things the world needs at the moment is more states, with their own armed forces and divisive nationalist ideologies.

Nationalism is based on the illusion that all people who live in a particular geographical area have a common interest, against people in other areas. Hence the supposed need for a separate state and a separate government to defend this separate interest.

This flies in the face of the facts. All over the world, in all geographical areas, the population is divided into two basic classes, those who own the productive resources and those who don’t and have to work for those who do, and whose interests are antagonistic.

The non-owning class have a common interest, not with the owning class who live in the same area, but with people like themselves wherever they live. The interests of workers who live in Scotland and Wales are not opposed to the interests of those who live in England–or France or Germany or Russia or Japan or anywhere else in the world.

Nationalists like the SNP and Plaid Cymru who preach the opposite are spreading a divisive poison amongst people who Socialists say should unite to establish a frontierless world community, based on the world’s resources becoming the common heritage of all humanity, as the only framework within which the social problems which workers wherever they live face today. This is why Socialists and Nationalists are implacably opposed to each other.

We are working in opposite directions. Us to unite workers. Them to divide them. So, insofar as the proposed assemblies in Scotland and Wales are a sop to nationalism–as to a certain extent they are–that would be more a reason for voting “no” than for voting “yes”.

Useless Unionists

So, what about voting “no”? It’s tempting. After all, Socialists don’t want constitutional reform (we want socialism) and a “no” vote would be a repudiation of the divisive doctrines of the narrow-minded Scots and Welsh Nats. But in the end the point at issue–a mere constitutional reform which will leave profit-making, exploitation, unemployment and all the other social problems quite untouched–is so irrelevant that it is not worth taking sides.

In addition, those leading the campaign for a “no” vote–various business people and the Tory rump–are conservatives in both senses of the term. They want to leave things as they are. They don’t want to change anything. We don’t see any point in diverting our energies to changing the constitution but we certainly want things to change. We want people to change the economic and social basis of society and establish socialism in place of capitalism. So we’ve nothing in common with them.

They fear that the proposed change will be the first step on a slippery slope leading to the break-up of the United Kingdom. Maybe, though this is not the opinion of Labour and the Liberals who are also Unionists. The leading “no” campaigners, too, are nationalists. Not of course Scottish or Welsh Nationalists, but British Nationalists, since that is what the Unionists are, spreading the poison that it is all the people in the British Isles who have a common interest against people everywhere else. But Socialists are just as much opposed to British Nationalism as we are to Scottish or Welsh or any other nationalism.

Just because we are not prepared to back the efforts of Scottish and Welsh Nationalists to break away from the United Kingdom–and vigorously oppose their efforts to split the trade union movement–does not mean that we are Unionists. We don’t support the Union. We just put up with it while we get on with our work of convincing people to reject world capitalism in favour of world socialism.

Vote for Socialism

So we shan’t be voting “yes” or “no”. We shall, however, be voting. We’ll be going to the polling station and, since they are not giving us this option on the voting paper, we’ll be writing the word “SOCIALISM” or “SOSIALAETH” across it.

If you want socialism, we urge you to do the same, as a way of registering your support for world socialism and your rejection both of separatist Welsh and Scottish nationalism and of unionist British nationalism.

This article is also available in leaflet form. Readers in Scotland and Wales wanting copies to distribute should write to: 52 Clapham High St, London SW4 7UN.

The Myth of Maastricht (1997)

From the September 1997 issue of the Socialist Standard

Pity the poor inhabitants of Maastricht. Six years ago no one outside of Holland and the neighbouring areas in Belgium and Germany had heard of the name of their town. Now, throughout Europe, it is a by-word for austerity, budget cuts and social regression.

It all goes back to February 1992 and the choice by the Dutch government, whose turn it then was to hold the presidency of the European Council of Ministers, to have Maastricht as the site for the final round of negotiations and the signing of a treaty to further integrate the economies of the Common Market countries. These countries aimed to move from a single European market without customs and other barriers to trade to an “Economic and Monetary Union” (EMU) in which there would be a single European currency to be controlled by a single European central bank.

Despite the various rather less sordid economic names it has gone under—and the Treaty of Maastricht changed the official name from European Community to European Union—the Common Market has always been essentially that: a project to bring about one unified barrier-free market in Europe. In other words, a purely capitalist project of no concern to ordinary people. That was why, in the referendum in 1975 on whether Britain should stay in or pull out of the Common Market, Socialists wrote “Socialism” across the ballot paper rather than voting either “yes” or “no”. That remains our policy for any future referendum on the subject.

The project itself goes back to the immediate post-war period when the capitalists of France, Germany, Italy and the Benelux countries realised that they would be handicapped if they tried to compete with America on their own and decided on the long-term goal of merging their economies into a single European economy.

This has been a long, slow process which has been going on for over 45 years now. First, the coal and steel industries were made subject to common rules. Then this was extended to all other industries and, at France’s insistence, to agriculture. A common external tariff was erected, then all internal customs and tariffs between the member states were abolished, then non-tariff barriers to trade (different technical and other standards which had to be harmonised) were tackled.

To the leaders of Europe at least one barrier to a fully integrated common market still remained: currency fluctuations. These distort trade by the effect they have on prices. If a country’s currency is devaluing this makes its exports cheaper and so gives its exporting capitalists a competitive advantage over those from other countries. As this advantage does not arise from employing more efficient productive methods it is seen as unfair by the other member states.

Ignominious exit
The Common Market has tried to get round this problem with various schemes to fix limits to the extent to which member state’s currencies are allowed to fluctuate in relation to each other. This hasn’t worked all that well, as shown by the devaluations over the years of the French franc, the Italian lira, the Spanish peseta and the British pound (which ignominiously left the European Exchange Rate Mechanism one famous Wednesday in September 1992).

The Treaty of Maastricht adopted the ambitious aim of establishing a single European currency as the solution to this problem. The first step is due to be taken on 1 January 1999 when the exchange rates between the currencies of those Common Market states which join will be fixed, in theory for ever. For instance, the French franc would from then on always exchange for, say 3.4 Deutschmarks. If this works, then “franc” and “mark” will in effect be different names in different countries of what is essentially, from an economic point of view, already the same currency. The plan is that in 2002 these different names should be dropped and the same name “euro” be adopted everywhere.

But it is not as simple as that. Devaluation is a downward adjustment of the external value of a state’s currency reflecting a deteriorating relative economic performance or the fact that its currency’s internal value has declined faster than that of other states due to its government pursuing a more inflationary monetary policy. So at least one condition for lasting fixed exchange rates is that each state should pursue the same monetary policy. As governments generally inflate their currencies to pay for their spending including on the National Debt, the Maastricht Treaty placed restrictions on the level of both government spending and government borrowing.

These are the famous “Maastricht criteria” which all governments hoping to be in the first wave of countries adopting the Single European Currency are striving to meet. Those who blame the resulting austerity on the Common Market overlook the fact that at the moment world competitive pressures are forcing governments everywhere, not just Common Market governments, to cut back on government spending and impose austerity.

It is global capitalism that is to blame not the Treaty of Maastricht as such. Maastricht only comes into it because it was when and where the member states of the Common Market decided to coordinate and harmonise the austerity measures that capitalism currently dictates should be taken.

It is an illusion to imagine that, if there had been no Maastricht Treaty, there would be no austerity measures, or that Britain or France or Sweden or wherever could avoid them by withdrawing from the Common Market. Maastricht is merely one way of applying capitalist austerity, not its cause. Austerity is capitalism’s current order of the day and no country can escape from it.

That’s why you don’t find Socialists standing on the White Cliffs of Dover alongside British ‘Euro sceptics’ such as Tony Benn, John Tyndall, Arthur Scargill, Lord McAlpine and the others waving Union Jacks and chanting “Maastricht, Out, Out, Out”. We are fair to the people of the Dutch town and place the blame for austerity where it really lies: on global capitalism.

Socialists are not among those sad individuals who feel their identity threatened by the disappearance of the pound. What does it matter what name a capitalist state’s currency goes under? If anything, while capitalism lasts a single European currency (if ever it comes) would bring a slight advantage to workers as, when we go abroad to work or on holiday, we would no longer have to pay a tribute to the money-changers as we do today. But Socialists don’t want capitalism to last. We want it and all its currencies to go.
Adam Buick

End Wages (1997)

Pamphlet Review from the September 1997 issue of the Socialist Standard

Bread & Roses. 20 pages; £1. From: 75 Humberstone Gate, Leicester LE1 4WB.

This is the first issue of a new regular publication by the British section of the IWW, the Industrial Workers of the World.

The ideal trade-union, from a socialist point of view, would be one that recognised the irreconcilable conflict of interest between workers and employers, that had no leaders but was organised democratically and controlled by its members, that sought to organise all workers irrespective of nationality, colour, religious or political views, first by industry then into One Big Union, and which struggled not just for higher wages but also for the abolition of the wages system.

The trouble is that this cannot become a full reality till large numbers of workers are socialists. In other words, you can’t have a union organised on entirely socialist principles without a socialist membership. This was recognised in the big discussion on “the trade union question” that took place in the Socialist Party in Britain shortly after we were founded in 1904. The idea of forming a separate socialist union, as the SLP in America advocated and tried to organise, was rejected in favour of working within the existing unions and trying to get them to act on as sound lines as the consciousness of their membership permitted.

The logic behind this position was that, to be effective, a union has to organise as many workers as possible employed by the same employer or in the same industry, but a socialist union would not have many more members than there were members of a socialist party. In a non-revolutionary situation most union members would inevitably not be socialists but would not need to be. A union can be effective even without a socialist membership if it adheres to some at least of the features of the ideal socialist union outlined above, and will be the more effective the more of those principles it applies. This is why Socialist Party members in the existing unions have always insisted on recognition of the class struggle, democratic control by the membership and no affiliation to the Labour Party.

The one successful attempt in the English-speaking world to organise a union on the above lines was the IWW, founded in Chicago in 1905. Successful in the sense that it did manage to function as a union extracting concessions from employers for a period of ten or so years until it was crushed by the American State for trying to exploit the labour shortage caused by the First World War to push up wages.

To tell the truth, Socialists have always had a bit of a soft spot for the IWW. How could we not for a union whose constitution declared: “The working class and the employing class have nothing in common . . . Between these two classes a struggle must go on until the workers of the world organise as a class, take possession of the means of production and abolish the wages system”?

However in 1907 the IWW came to be controlled by doctrinaire anarcho-syndicalists who not only (rightly) rejected attempts by various political parties to take over the union (both the reformist SPA and the DeLeonist SLP had designs on it) but also rejected the need for workers to win control of political power in order to be in a position to abolish the wages system. This latter was obviously a position we could not accept and we said so in debates with IWW propagandists in Britain where the IWW was never a proper union but only a propaganda group for the ideas of the North American IWW.

What had happened was that the IWW had been taken over by what amounted to a political group, which tried to impose its views as those of the organisation as a whole. This was in fact contrary to the IWW’s declared principles which meant that it should have been neutral on the issue of whether or what sort of political action workers should take to end the wages system.

The IWW did manage to survive the US state’s clampdown on it in WWI but more as a propagandist group than a union dealing with employers. It still survives and, though it does have negotiating rights in a few leftwing bookshops and vegetarian restaurants in America, is still essentially a propagandist group. That’s not a criticism (we’re one too) but it means that in practice the IWW now acts as a ginger group within the existing union movement, campaigning for the same sort of things (class struggle, democracy, no links with Labour) as our members have always done. That’s not a criticism either; in fact some members of the Socialist Party are active in the IWW just as we are in other unions and groups within them.

Bread & Roses reads quite well, not unlike this journal; perhaps because half the articles have been written by Socialists.
Adam Buick