Economic nonsense (1971)

Book Review from the June 1971 issue of the Socialist Standard

What Economics is About, by Michael Barratt Brown. Weidenfeld and Nicolson. Paperback. £1.

Michael Barratt Brown has written a textbook on economics mainly for the trade unionists he teaches in the Extramural Department of Sheffield University. Brown is a frequent contributor to Tribune and claims that his book “can be distinguished from most economic textbooks by its inclusion of Marx’s economics in the main stream of economic thought”. If it is to be judged on this basis, the book fails since Brown has no understanding even of so elementary a concept in Marxian economics as the distinction between use-value and exchange-value. But to be fair he only follows the Russian and East European economists (and especially the exiled Czech Ota Sik) who have twisted Marx’s Labour Theory of Value into a theory of pricing for “socialist" (read “state capitalist”) society.

Brown believes that production for the market is compatible with Socialism, an idea Marx rejected as absurd. Socialist production would be solely for use. In other words, products of labour would not be commodities with an exchange-value or price. They would simply be use-values, useful things produced by human beings to satisfy their wants.

Apart from this false claim to be partly Marxist, Brown’s book is not a bad introduction to the sort of economics that is taught today. It has a good criticism of the usual assumption that under capitalism the consumer is king:

   What then is left of the economist’s model of the market economy under conditions of large-scale modern industry? Wants are not apparently given but created by those who supply them; incomes are distributed as much according to inheritance as according to performance, and wealth and poverty tend steadily to polarize; free competition is replaced by monopolistic positions at home and cartels abroad; prices are fixed rather than emerging from the free play of market forces; profit results from monopoly as much as efficiency; capital is concentrated in giant international companies which themselves determine the allocation of the world’s resources; labour follows the concentrations of capital as best it can. In this crude and summary picture precious little is left of the market as the reconciler of consumers’ needs and producers’ power.

It also has some useful facts and figures. In 1966 the value of property vested in the State was £34,000m, but the National Debt was £31,000m. which means that most State property is mortgaged to private capitalists. Again, “not much more than 5 per cent of the adult population own capital from which they can derive a current income” (“the richest 5 per cent of the population owned in 1960 about 75 per cent of the total personal wealth and drew 92 per cent of all property income”), and about 10 per cent of adults in Britain own all property

Another 45 per cent own some capital which consists usually of a house and some small savings for the future in an insurance policy or a savings bank. The standard of living for most people therefore is based on their weekly or monthly wage or salary.

Adam Buick