Leaders : Are they really necessary? (1967)

From the March 1967 issue of the Socialist Standard

This, as the newspapers never tire of telling us, is the age of progress and enlightenment; which means, among other things, that every little girl and every little boy in the schools is taught that to worship idols is evil. Of course, this applies to only one sort of idol. Those same little girls and boys are also taught, in those same schools, that to worship leaders is virtuous.

The leadership principle is one of the pillars of property society. The vast majority of people are convinced that the world is so full of complex and dangerous problems that only a few can be expected to have the knowledge, the ability and the courage to deal with them.

This select few are the leaders. There is even something called a “born” leader, although when we consider the properties leaders are supposed to have it is reasonable to wonder whether they can be said to be born like the rest of us.

For the most part, the working class accept it all. The nearest they come to criticising is to complain about the quality of the leadership they suffer, and to pine for stronger or weaker, or abler, or some other type of leadership. Just see how enthusiastically they react whenever a great man drives through the streets. Study their smiles, a mixture of joy and amazement, when he proves that he is human by getting out of his car and coming across to clasp hands with them.

No shadow of doubt can be seen on those happy faces. None of them is asking what a leader is supposed to be, to do, to be worth. So let us, the minority who do not accept the leadership principle, ask the questions.

A leader, first of all, is supposed to be someone who does things which are good for us. His intentions are supposed to be of the best and under his wise and humane guidance we should flourish into prosperity and happiness. But it is at once obvious that, to put it at its mildest, this is not always so. To take the plainest of recent examples, whatever intentions lay behind Hitler’s rages, or Stalin’s level eyes, they were not inspired by the greatest good of the greatest number.

Of course when it was convenient for them, the allied leaders made great play on the evil results of the Hitler and Stalin tyrannies. This propaganda was acceptable to those workers who console themselves with the notion that all evil leaders are foreign. It ignores the fact that, at the same time as the British leaders were condemning the Nazis’ savagery, they were themselves indulging in delicate operations like arguing about which of them had correctly calculated the number of houses the RAF could destroy in their attacks on German cities.

Now the whole point is that if it is possible for a leader to be a murderous tyrant, if a leader can act against human interests, the case for having a leader is severely damaged. If leadership is a sort of lucky dip, with a good chance of coming out with a Hitler, then there is a strong argument for not sticking our hand into the bran tub.

Whether a leader is “good” or “bad”, one quality he should have is to know more than his followers. Some leaders, of course, assert that this is all done by intuition. There is no argument in favour of leaders unless they know better than anyone else. How do our leaders match up to this?

Harold Wilson is a leader who, if anyone, should know almost everything about economics. If anyone can control capitalism’s ups and downs it should be one-time economics don Wilson. Yet ever since he came to power he has been bleating about the uncontrollable, unpredictable surprises which capitalism keeps giving him. The ship, Wilson told us last July, had been suddenly blown off course which was an admission of his impotence to control events. Is there any point in having leaders, if they have to make such confessions?

We can get an idea of how much at sea Wilson the leader is, in what should be his specialist subject, by what he said in the House of Commons on February 7 last:

  Mr. Heath: What is to be the rate of growth this year? Mr. Wilson replied that he would not like to forecast that, any more than any other Prime Minister has done. (Daily Telegraph, 8.2.67.)

Here is Wilson admitting that he cannot say what the rate of economic growth, a matter which he is tirelessly telling us is one of his government’s first concerns, is going to be. In other words, that no matter what sort of a leader we have capitalism is unpredictable, that it can blow up sudden storms or settle into unexpected calms. Leaders can amass all the facts possible, they can adopt what pretence they like. When it comes down to it they have to admit that events are beyond their control.

This is what provokes what are sometimes called leaders’ “mistakes” but which might have other descriptions. Indeed, history is littered with examples of politicians’ broken promises, misguided calculations, discredited forecasts.

Consider, for example, one of our present leaders' favourite brainchilds—the Selective Employment Tax. This tax was carefully worked out by the economic experts—those men who have all the knowledge humbler people cannot hope to absorb—to have certain effects. One of these was clearly to rake in some of the profits from a sector of industry—the service trades—which had escaped heavy taxation. And as a result of this, it was expected that the service trades would unload a lot of their employees, who would find their way into manufacturing industry.

But, according to the Guardian’s Labour Correspondent (13/1/67), the opposite has happened:

  Full time employment in the service industries has increased. . . . Employers have tended either to employ part timers for less than eight hours a week and thereby avoid the tax or to seek better value for money . . . by hiring more full time workers.

Perhaps one day soon SET will be written off, as other favourite schemes have been, as a simple mistake. But we should remember that leaders ean err in other fields. Edward Heath, for example, has for a long time been under fire within the Conservative Party because some Tories think he is constantly making mistakes in leadership. It is fair to ask if leaders are worthwhile if, apart from anything else, we are liable to get one who does not even know how to lead.

Heath, of course, is likely to stay loyal to the Tories, who have a reputation which many a Labour man might envy for keeping up appearances in public whatever is going on behind the scenes. It is not taking things too far to say that the Labour Party, such has been their history, have developed a veritable neurosis about treacherous leaders.

Ramsay MacDonald is long dead but his ghost still walks. Since he double-crossed his party, every other Labour leader has been closely watched for signs of his doing the same thing. Nervously, Labour M.P.s are always on the lookout for symptoms among their leaders of MacDonald's vanity, his contempt for his followers, his taste for high society. Many a Labour leader since 1931 has been compared to the arch traitor.

But no M.P. has ever wondered whether, if it is possible for a leader to damage his party by being a traitor to it, it is worthwhile having them. None has ever asked himself if he would sleep the easier for knowing that he was no longer in the hands of someone who might turn over to the other side. (And how MacDonald damaged the Labour Party by his defection!) The Labour Party prefers to keep its leaders, to watch and worry and, when the betrayal comes, to wail.

The case against leadership in principle, then, is formidable. Leaders can be ruthless and inhumane; they can be as ignorant as anyone else; they can make massive mistakes; and they can betray what their followers have always thought of as their principles.

So why keep them? The simple answer (although this may seem presumptuous) is that the existence of leaders reflects the ignorance, the apathy, or the delusions, of the people who follow them. Since we have mentioned MacDonald we may as well take him to prove the point.

For a long time MacDonald has been the Labour Party's Satan but at one time he was its God—and the faithful are not expected to criticise the Almighty. Even before MacDonald formed the National government, he had denied all his party had ever stood for; what was the attitude to this, among the Labour Party at the time? This is how Michael Foot, in his biography of Aneurin Bevan, describes it:

   . . . the authority of 'the Big Five’ remained to the end unshaken, almost undented. A few in minor offices, the Attlees and the Daltons, might utter their doubts behind cuffed hands, but at the party meetings they played loyally in the team and pledged their support to the irreplaceable captain.

Now these people who were either being duped, or were allowing themselves to be duped, by MacDonald, were all themselves Labour leaders. They were all experienced—some of them hardened—politicians. Yet until MacDonald himself walked out on them they supported him. This is a perfect example of a leader living off the political ignorance of his followers.

One aspect of this, ignorance is the confusion over the meaning of leadership. Many people think that anyone who has a special knowledge and who applies it to the rest of us— like a doctor—is in that fact a leader. We don't know enough to treat ourselves, runs the argument, so we have to rely on the doctor to do it for us. That makes the doctor a leader which proves that we cannot exist without leaders.

Yet there are limits beyond which a doctor's special knowledge cannot be applied, because our knowledge makes us question him. If, for example, we went to our doctor with a poison toe and he started preparations to lance our finger we would probably get in touch with a couple of his colleagues to have him certified. (Perhaps it is no coincidence that Harold Wilson once said his favourite image of himself was as the people's family doctor.)

For some reason, the working class do not apply these same standards of judgement to politicians. A doctor who sometimes murdered his patients, who confessed to a lack of medical knowledge, who kept performing the wrong operation and who ended up working for the undertaker would soon get what he deserved. Yet political leaders who carry on in the same way remain on their pedestals, in their offices.

All that is needed to end this is some basic knowledge. Not very much; only the equivalent of knowing that the doctor is treating us for the wrong complaint; only enough to tell us that the society we live in now does not work in our interests and that to get rid of its evils we must fundamentally change it.

With that knowledge, workers are impervious to the promises, the deceptions, the mistakes and the treachery of leaders. They have no need of leaders to tell them what to do; they have the essential equipment to build the new society where people count.

Ivan

Finance and Industry: Labour Hangs Itself (1967)

The Finance and Industry Column from the March 1967 issue of the Socialist Standard

Labour Hangs Itself

There was a time when the Labour Party used to promise that, if elected, they would use the power of the state to help the trade unions get higher wages. They used this one right up until 1945 but the wage freeze of 1948 reduced its effectiveness and they have not dared use it since. Indeed, many of the Labour leaders spent their years of opposition working out plans to control wages. Returned to power in 1964 they straightway tried their incomes policy which was soon exposed for what it was when it became a legal wage freeze last July.

Unlike some of Labour's other plans the wage freeze has worked. Since July wage rates have stayed the same, while prices have risen 1.5 per cent. So the working class became worse off, as the official Ministry of Labour figures show:

Further, between April and October the average weekly earnings of men in manufacturing (a figure, the misuse of which the Socialist Standard has often exposed) fell for the first time since 1945.

Labour speakers tried to create the impression that there was a price freeze too, arguing that in gratitude for this the working class ought to put up with the wage freeze. But this was just a lie to cover up their aim of cutting our standard of living. Aubrey Jones, boss of the Prices and Incomes Board, was a little more frank when he gave evidence to the Royal Commission on Trade Unions on October 4. As reported by the Financial Times (the official report is not out yet), he admitted

  What was annoying trade unionists and others responsible for wage claims was the apparent disparity between the freeze in pay while prices increased, mainly on account of the selective employment tax. The object of the tax was to cut back the country’s living standards because they were rising too fast. It was, therefore, the Government’s policy to some extent that prices should rise relative to wages, Mr. Jones said.

How otherwise could they cut our standard of living?

Earlier (on August 22 last) the Financial Times exposed the price freeze as a myth. “There is no price freeze", it declared and went on:

  It is quite true that the White Paper speaks of ‘a general standstill on prices and charges until the end of 1966’. But the qualifications —quite rightly introduced — are so many that most businesses will be able to find a good reason for putting up their charges. The biggest gateway is the reference to Government action ‘such as increased taxation’. On the very day of the squeeze announcement, indirect taxes, except on tobacco, were put up by 10 per cent by the use of the Regulator. The impact of the Selective Employment Tax is still to be felt . . . ‘Government action’, moreover, has not been confined to taxes. Higher interest rates will provide a potent excuse in many cases. There are other gateways, too: ‘market increases’ in imported material prices, changes in supply, and increased costs of components which cannot be absorbed.

Finally, the very resolution supporting the freeze, which the Labour Party Conference passed, mentioned “tax increases and import price rises" as exceptions.

So there’s no doubt about it. There was no price freeze; nor was one intended. But even if there had been, that would be no argument for the workers giving up the conscious and organised struggle for higher wages and salaries.

The Labour Dole

The wage freeze cannot have been too much of a shock to Labour supporters, since their party had tried one before. But take a look at the third column in our table—the number of unemployed. Surely after years of anti-unemployment propaganda a Labour government would never welcome and encourage the growth of unemployment? Surely this could not have been cynically used to cadge votes?

Whether the Labour leaders are sincere or not, it does not make much difference to the way they are forced to act. But we must speak out against the cynical exploitation of working class misery by vote-gathering politicians. And, with specific reference to unemployment, it is hard to acquit Wilson on this charge.

On March 26 last, a few days before the election, Wilson told a Labour Party meeting in Manchester (quoted in The Bad Package, a pamphlet put out by five technicians’ unions):

  The only method the Tories knew of fighting the crisis they brought on the country was deflation to unemployment and short-time working. These financial technocrats who dominate the Tory Party had no thought, no compassion, for the families driven to live on the Tory dole. Nor did they think of the large number of families whose standard of living fell because of the drop in their earnings caused by deliberate policies which could only lead, and did lead, to short-time working.

Note the skilful combination ’Tory dole". Yet, four months later Wilson was talking in the House of Commons of “a tolerable figure of unemployment" of “between 1½ and 2 per cent", that is, a little over 400,000. When Wilson spoke there were only some 264,000 on the dole. Thus, in effect, he was coolly declaring that he was prepared to see another 150,000 thrown out of work. But this is not all. When by October the numbers began to approach the “tolerable" level Minister of Labour Gunther rushed in to explain that Wilson regarded two per cent as the tolerable figure after so-called redeployment. In other words this was not the limit. Pressed in the House of Commons on October 27 to give “a categorical assurance that the Labour government will not stand for a level of 500,000 unemployed under any circumstances", Wilson refused. At the last count there were some 600,000 unemployed.

Unemployment is inevitable under capitalism and governments, despite Keynes, have very little control over it. Perhaps Labour’s failure to tame capitalism will lead people to see the futility of Labourism. Already many trade unionists are discussing breaking with the Labour Party and, for the first time for many years, there are resolutions down for their conferences calling for just this.

Tory Sense

In a recent speech to a branch of the National Union of Bank Employees Enoch Powell told them, according to the Financial Times of 13 January, that “unions were harmful not only to the community but also to their members: there was a net loss resulting from their existence”. A year ago, in an address to some Young Conservatives, another Tory MP, Nicholas Ridley, declared:

  I think we have got to look at the situation if there were no trade unions after the war. And if there weren't I believe wages today would be higher. The net effect of trade unions is that probably they tend to keep wages down, although their members don't know it. (Marylebone Mercury, 3.12.65.)

That unions keep wages down is surely something they ought to tell the Labour government; it opens new possibilities for their incomes policy after the period of severe restraint!

Seriously, though, this is an old one. Trade unions, the argument goes, keep wages down by' restricting production; if there were no unions with their restrictive practices production would go quicker and we would all be better off. The answer is simple: workers must combine in order to get the best price for their ability to work. Without any unions, without any organised means of resisting the ever-present pressure of employers to reduce their “labour costs”, workers would be at the mercy of their employers and soon reduced to a sorry state. Besides production does not go up in a steady line under capitalism, restrictions or no. It goes up and down and with it go employment and wage levels. At times, unions can push up wages at the expense of profits. This has tended to happen since the war. Which is what the Tories are really worried about.

Adam Buick

GLC Elections: 13 April 1967 (1967)

Party News from the March 1967 issue of the Socialist Standard

The Monopoly of Wealth (1967)

From the March 1967 issue of the Socialist Standard

The basis of present-day society is the class monopoly of the means of living, that is, the land, factories, railways and so on. Accumulated wealth is monopolised by a privileged minority. The rest, separated from the means and instruments of labour, are forced to work for those who own them. This inequality, poverty and slavery is capitalism.

In Britain the capitalist class own the means of production through having paper titles such as bonds or shares which are backed by the law and enforced by the state. So that from these titles an estimate of the concentration of wealth ownership can be made. One of the results of the 19th century struggle between the industrial and landed property-owners was Estate Duty, a tax levied on the wealth of those who died. The figures of the collections from this tax are published every year in the report of the Board of Inland Revenue. The various figures in this report, together with mortality rates from the Registrar General, have provided the basic data for all the estimates of the concentration of wealth that have been made over the years.

It so happens that one of the first of such estimates was made at the time the Socialist Party of Gt. Britain was founded. For 1905 Sir Leo Chiozza Money came to this conclusion in his Riches and Poverty:

  About one-seventieth of the population owns more than one-half of the accumulated wealth, public and private, of the United Kingdom.

Money's calculations were no doubt crude by modern statistical standards. Yet every study since has shown a similar inequality, despite the reign of two governments committed to redistribution in favour of the poor—the Liberal of 1906 and the Labour of 1945.

Take a few of the recent estimates: On 8 April 1962 the Economic Editor of the Observer spoke of “this fantastically unequal distribution of wealth”:

   Judging by the latest Inland Revenue estate duty figures, fewer than 200,000 people (about ½ per cent of the adult population) own a quarter of total personal wealth, worth over £50,000 million. Nearly half of this total personal wealth is held by the top 2 per cent owning more than £20,000 each.

On 15 January 1966 the Economist, using amended investment income figures from the Inland Revenue report, estimated that in 1959-60, fifty-five per cent of personal wealth was owned by 2 per cent of taxpayers, while 88 per cent owned on average just over £100.

On 13 January 1967 the Financial Times wrote of figures showing that in 1960 the top 1 per cent owned 42 per cent of personal wealth (the top five 75 per cent and the top ten 83 per cent), that although there might be some exaggeration “it still remains true that the bulk of the population own very little personal property”.

A more scholarly study for 1945 appeared in the Bulletin of the Oxford University Institute of Statistics in February 1961. The authors, H. F. Lydall and D. J. Topping, noted that “Personal wealth is very unequally distributed in this country”. They wrote of one of their tables:

   In broad outline these figures suggest that total personal net capital in early 1954 was about £40,000 million. Of this nearly £31,000 million was owned by three million persons possessing over £2,000 each; and the remaining £9,000 million was owned by the other 32 million aged 20 and over. In the top capital group there are 20,000 persons with more than £100,000 each and an average holding of over £250,000; in the bottom group there are 16 million persons with less than £100 each and an average holding of less than £50.

And, of another table:

  These estimates suggest that in 1954 the top one per cent of British adults owned 43 per cent of total net capital and the top 10 per cent 79 per cent.

Comparing their figures with those for previous years, they wrote that “over the past twenty years there has been some reduction in the inequality of personal wealth in Britain”.

Not all who have studied the figures agree with this conclusion. For one of the disadvantages of using the death duty figures is that they miss those who manage to avoid paying them and, over the years, the wealthy have evolved quite sophisticated ways of doing this. J. R. S. Revell, in an address to the British Association in 1960 (discussed in the Socialist Standard of November 1960), mentioned a few: distribution within families and especially the discretionary trust:

   Under that form of property the trustees had the discretion to pay income to any of a specified class of persons and to distribute the capital when they thought fit. When the person who had been receiving the income died, the trustees merely nominated another person from the specified class, and there was no passing of capital which could attract death duties.

R. M. Titmuss, in his Income Distribution and Social Change (1962), studied the supposed trend towards equality of incomes and showed how the Inland Revenue figures were not a reliable guide. Titmuss explained in detail some of the dodges to avoid surtax and estate duty. While pointing out that there were no really accurate and reliable figures he suggested:

  There is more than a hint from a number of studies that income inequality has been increasing since 1949 whilst the ownership of wealth, which is far more highly concentrated in the United Kingdom than in the United States, has probably become still more unequal and, in terms of family ownership, possibly strikingly more unequal in recent years.

Whichever way you look at them, these figures bear out the validity of the first clause of our Declaration of Principles. What, then, do Socialists suggest? In the past we were accused of wanting equal sharing and to divide up amongst the poor the wealth of the rich. This, of course, was a lie. What we do advocate is the social ownership and democratic control of the already socially-operated means of living. Ironically, it is the open defenders of capitalism, the Tories and Liberals, who talk of a “property-owning” or a “share-owning” democracy. Which is as much an illusion as is the Labour promise to redistribute wealth more equally through taxes. All such attempts have failed, and will fail, because the very basis of capitalism — the system they accept —is the concentration of the ownership of the means of living in the hands of a few and the resulting poverty and degradation of the rest.

Adam Buick

50 Years Ago: Ideas of Class Supremacy (1967)

The 50 Years Ago column from the March 1967 issue of the Socialist Standard

While it is true that the ruling ideas in a society concerning matters of social significance are always of such a nature as will tend to keep stable the society and preserve it from internal and external disruption, and that they uphold the interests of the ruling class, it must not be imagined that they are deliberately manufactured with this end in view. They are largely the legacy of past social development, built upon and remodelled as the interests which dictated them changed.

The average member of a dominating class is firm in his belief that those ideas are true. His class environment, associations and traditions are all favourable to this result. Here we come up against that curious phenomenon which has confounded so many philosophers, social and historical students—the manner in which ideas and actions which really are based upon and in line with material class interests are draped in fantastic ideal coverings and are given a moral justification which is actually taken to be their root cause instead of merely the superficial trimming.

The man of the ruling class sees that the condition of things obtaining is good for him and good for his class.

He does not put this down to the impersonal cause of a condition of property relations growing from a historically developed method of living giving wealth and position, with all that they command, to his own class withholding them from the subjected. His natural egotism, supplemented by the class tradition, suggests rather a personal cause to be found in the attributes of his class, such as “blue” blood, military prowess, a “divine right* in medieval times and thrift, initiative and directive ability in the present capitalist era. This gives rise to a contempt for the “lower” class—a contempt expressed either openly or in the thin disguise of a paternal superiority.

From the Socialist Standard March 1917

Aspect: Money for Nothing (1967)

The Aspect column from the March 1967 issue of the Socialist Standard

In the Sunday Times on January 29th, Mr. George Schwartz used his column to put his views about high and low interest rates and about some of those who have theorised on the matter. He recalled the late Lord Dalton, Labour Government Chancellor of the Exchequer, who believed that it was a simple matter for a government to keep interest rates at a very low level, and an American Secretary of the Treasury who shared that view. The idea is not dead: “Even at this moment there is an assumption that the Finance Ministers of the leading countries have only to put their heads together to cheapen money all round. The higher economics refuses to regard the rate of interest as a simple function of the demand for and the supply of loanable funds . . .”.

Schwartz commented on the Bank Rate:

  It is fashionable to talk of the Bank Rate as an antiquated weapon, but the antiquated thinking is in the minds of the critics. Bank rate is not a weapon but an index. It registers the going level of interest rates which is determined by all the forces operating upon saving and borrowing.

Marx long ago described the factors which immediately determine the rate of interest in about the same words as those used by Schwartz. (Perhaps Schwartz had been looking up what Marx wrote?). “. . . the relation between the supply of loanable capital on the one side and the demand for it on the other, decide at any time the market level of interest". (Capital, Vol. 3, p. 430.)

Marx described how capitalist profit derives from the unpaid labour of the working class and how, if the capitalist is using borrowed funds, he has to pay away part of this profit in the form of interest, the amount depending on the prevailing interest rates:

  . . . we shall find that a low rate of interest generally corresponds to periods of prosperity, or of extra profit, a rise of interest to the transition between prosperity and its reverse, and a maximum of interest to up to a point of extreme usury to the period of crisis. . . . It may happen, however, that low interest is found in times of stagnation, and moderately rising interest in times of increasing activity. The rate of interest reaches its highest point during crises, when money must be borrowed in order to meet payments at any cost. (Capital, Vol. 3).

Particular interest rates vary according to the class of security, and the length of the time for which the money is borrowed, but the average rate of interest, like the average rate of profit, shows long periods of stability, apart from the ups and downs referred to above.

  The average rate of interest appears in every country for long epochs as a constant magnitude, because the general rate of profit—in spite of the continual variation of the particular rates of profit, in which a variation in one sphere is offset by an opposite variation in another sphere—varies only in long intervals. 

In our day there is continual argument between those economists who expect the average rate of interest to remain high for many years and those who expect it to fall.

It follows from the way in which interest rates are determined that, as Schwartz points out, a government cannot determine those rates simply by exhortation or by monetary manipulation but would have to control all the economic factors which combine to affect the supply and demand for loanable funds. Schwartz recalled the belief some people held in the years before the war that there was a tendency for interest rates to go on falling till they reached zero. It was at that time that the theories of Silvio Gesell had some vogue, in particular his scheme of “free money” which, he claimed would do away with interest payments.

But the will o' the wisp of very low or zero interest rates on loans was much older than Gesell, whose works were first translated into English in 1929— the year before his death. Gesell had been influenced by Proudhon, and Proudhon had been preceded by John Gray, who was writing in the first half of the nineteenth century.

Gesell proposed that money should be issued in a form which depreciated with every week from the date of issue, his suggestion being that each note should lose one-tenth of one per cent of its face value each week. This, he thought, would deter people from holding on to money, they would want to get rid of it quickly and this would keep the level of investment up and the rate of interest down and would also obviate depressions.

The basic economic fallacies of Proudhon and John Gray were examined by Marx in his Critique of Political Economy and Capital (Vol. 3, chapter XXI). Both Proudhon and Gray wanted capitalism, but not the features which inescapably belong to it. They wanted products to be bought and sold but not to conform to the economic laws of commodity production. Products were to have their price determined directly by a National Bank which would issue certificates related to the amount of labour it required to produce them. Those certificates were then to circulate as money: no-one would need to pay high interest rates for loans or indeed any interest at all.

Gesell’s particular scheme has not caught on although Keynes, who combined a low opinion of Marx with a high opinion of Gesell, expressed the view that “the future will learn more from the spirit of Gesell than that of Marx”, (General Theory of Employment).

But we have had quite a good test of the Gesell theory, even if not in the form he proposed.

For a quarter of a century money in this country has been more or less steadily depreciating but far from interest rates foiling to zero, Bank rate has recently been up to a peak 7 per cent and one of the government’s complaints at the present time is that manufacturers have been slowing down their rate of investment.

As befits followers of Keynes low interest rates have been an article of faith with the Labour Party. Their publication Twelve Wasted Years (1963) had scathing criticisms of the Tory government for failing to keep interest rates down.

In the election campaign in 1964, Labour were promising lower interest rates generally, including the hope of very low rates on house mortgage loans. Events soon overtook them, as shown by the rise in the Bank rate to the same level as under the Tories and by mortgage rates at the end of 1966 more than double their promised three per cent. Like Gray, Proudhon, Gesell and Keynes, Labour are trying to have capitalism without its inherent consequences.

Edgar Hardcastle

A Degrading Relationship (1967)

From the March 1967 issue of the Socialist Standard

The man with a black brief case and an aura of the National Assistance Board stood in the doorway . . . “I am looking for a Mr. So & So”, he began, and added . . . ‘I am from the Ministry of Social Security”. . .

The new era of capitalistic '‘Social Justice” had arrived, grandiloquent title and all.

I directed him up the Edwardian staircase to a proletarian attic, and brusquely swinging his case of “social security” he mounted the stairs to dispense it. But behind the new title and the suave officials, it may be timely to enquire whether the old relationship that existed between the National Assistance Board and its applicants has been abolished along with the title?

What was that relationship anyway?

The following incidents, witnessed by the writer in 1965, may serve as an illustration . . .

A long queue of the destitute moved slowly over a wooden bench as their surnames were lustily echoed to the rafters by an NAB. official whose voice would have done justice to a court crier.

The dejected queue moves one by one before a tough looking receptionist who demands of each . . . “Name & Address” . . . which he busily scribbles down. Then . . . “Have you signed on for work”?. . . “Yes”. . . “Then come and see us again in three days”. . . “But I am destitute”. . . “Well, try and hang on for another day or so, we don't pay out any money here before the three days rule”. . . Crestfallen, the majority shuffle out and count the weary days that must elapse for each fresh applicant.

One, however, an immigrant from the Emerald Isle threatens to break all the NAB windows if he does not get immediate aid. Significantly, he is given preferential treatment. This is the set up of bullying and degradation that existed under the NAB. On one side, the power of. the capitalist state machine, on the other, worn out hulks of those who spend their lives on the wages treadmill until they finally reach a bench at the NAB.

Nor can it be said that relations were any better under a previous state department —the Unemployment Assistance k Board . . . that notorious UAB of the Hungry Thirties which incorporated the Household Means Test in its obnoxious administration and under which the present writer received 34/- weekly for himself, wife and two children after the Inquisition had been well and truly applied.

Thirty years later, the NAB scale of 76/- plus rent allowance for each person has to be viewed against the rise in the cost of living that has occurred in the interval. This makes it clear that the share of the destitute in the “affluent” society is, to say the least, nothing to write home about.

However, we are not here concerned with the degree of relief from destitution authorised by successive Governments, but with the degrading social relationship between the haves and have nots arising from the class division inherent in a profit based economy. This subjection of the vast majority by a small ruling class, and the indignities following from this state of affairs, is what Socialists the world over are dedicated to destroy. When property society is finished, that eternal plaint of capitalism . . . “Brother, can you spare a dime?”. . . will go down in history as the scene of disease which plagued humanity far too long.

G. R. Russell

Letter: Strategy (1967)

Letter to the Editors from the March 1967 issue of the Socialist Standard

Sir: In a letter to the Socialist Standard, published in December 1966, I called for an open-minded discussion of socialist aims and strategies, and also put forward a few suggestions concerning a clear-cut parliamentary strategy. In its reply the Editorial Committee denies that there is any common ground for discussion between the SPGB and other political organisations. These are all supporters of capitalism!

In my opinion this is a deplorable sectarian attitude. Instead of trying to monopolize socialism for itself the SPGB should recognize genuine socialist aims in the programmes of other organizations as well, even if they make use of different formulations. Suppose that Labour left wingers, communists, and anarchists all agree with SPGB-socialists that capitalist privileges should be abolished, and that some form of collective ownership and control of large companies and mass media must be established! Would not that provide a common ground for discussion of strategies, a discussion which might result in political cooperation, perhaps even in a political synthesis?

As to my suggestions for a socialist strategy they certainly cannot be dismissed as “trifling reforms of capitalism”. Confiscation of large fortunes, transfer of economic power to the employees, and abolition of large or unearned incomes would mean nothing less than a social revolution, an overthrow of the entire capitalist system as far as it is based on privileges,' exploitation, and authoritarianism. The utopian dream of abolishing money and production for the market, on the other hand, seems to be too extravagant to provide a realistic political platform for our generation. It has never been proved anyway that such a drastic step is a necessary condition for the attainment of social justice, freedom of opinion, cultural progress, and other humanistic values.

In view of the present world crisis cooperation between the forces of the Left is a necessity. Perhaps this co-operation must also be extended so as to include objectives less than socialism, e.g. reduction of military expenditure and withdrawal of support for the US aggression in Vietnam. 

Sune Hjorth, 

Sundovall, Sweden

Reply: 

Let us get one thing clear straightaway. We stand for a system of society based on the common ownership and democratic control of the means and instruments for producing and distributing wealth by and in the interests of the whole community. Mr. Hjorth now tells us that this is a “Utopian dream” and “too extravagant” and a “drastic step”. By what right, then, does he presume that we can discuss “strategies” with him for an aim he doesn’t share? We can discuss his ideas, certainly, but there is no ground for discussing how to achieve a common aim since there is none.

Mr. Hjorth is taken in by words. True, Labour “leftwingers”, communists and anarchists all claim to stand for Socialism and all talk about common ownership and democratic control. He thinks that this is enough evidence for concluding that they and we have the same aim and that, therefore, whether there will be money or market-production in a socialist society is just a matter of opinion.

He could not be more confused. Money is not just a thing, not just a convenient means for circulating wealth. It disguises a relation between people; in fact, that between independent property owners. Its existence, therefore, implies that of property society too. When relations between people and there are no longer property exchanging wealth, but a classless community producing for use, then money and all the rest of the paraphernalia of buying and selling will become redundant. It won’t be “abolished”. It will disappear, along with wages, taxes, capital assets and investment as a necessary consequence of the assumption by society of the ownership and control of the means of living.

Mr. Hjorth still cherishes his list of reform measures. Some are trifling. Others would demand so high a degree of understanding and determination on the part of the working class that it would almost amount to socialist understanding. Which would make his reforms pointless as people would be demanding Socialism.

Editorial Committee

Cooking the Books: Vice’s homage to virtue (2005)

The Cooking The Books column from the March 2005 issue of the Socialist Standard

At their annual “World Economic Forum” jamboree in the Swiss ski resort of Davos in the last week of January, the world’s political and business leaders vied with each other to strike an “ethical” pose. It was, commented one newspaper, a case of ethics with everything.

There is even a magazine called the Ethical Corporation. At the time of the Tsunami its Asia-Pacific editor, James Rose, was active in the Australian press. “Put profits aside in the rebuilding” read the headline of one of his articles, “Shareholders should let companies assist in the post-tsunami reconstruction” (Australian, 4 January). “Companies must look beyond the bottom line” read another, “Corporate leaders see only profits as important. They must change” (Melbourne Age, 7 January).

Shareholders in construction companies would be only too willing to let them assist in the rebuilding. In fact, shares in them went up in anticipation of juicy reconstruction contracts. But this was not what Rose had in mind. Supply lines for aid, he wrote, “could be usefully shortened if corporations went in and did more of the work themselves, gratis, under the direction of the charity groups on the ground”, and:

  “What we need here is for corporations to throw off the cloak of self-interest. The best thing they could do is to approach the situation as it now stands as if it were a legitimate business opportunity, apart from one important factor: they will expect no financial or brand rewards”.

It’s a nice thought. The skills and the techniques are there, there are people in need, so why not bring the two together without any thought of profit? But it’s not going to happen, because that’s not the way capitalism works or could ever work.

Capitalism is a profit-making system and capitalist corporations have no choice but to put profits first. Not because the top executives are selfish or greedy or insensitive but because that’s the economic logic of the system. Corporate executives are merely what Marx once called “personifications of capital” and capitalism is an impersonal economic mechanism of the accumulation of capital out of profits which those in charge have to apply irrespective of their personal opinions or preferences.

Rose is aware of what he is up against as he wrote in the same issue of The Australian:

  “What is a corporation? On one level, it’s a pure money-making machine. There is solid opinion to say that’s all it can be. Even if a corporation wants to be a paragon of the New Age, it is constrained by the fiduciary obligations to its shareholders. It is legally constructed to focus on its and its owners’ self-interest”.

That opinion is indeed solid, very solid. Corporations don’t seek to maximise profits just because this is laid down by the law, as Rose suggests. The law merely reflects the underlying reality of capitalism. It’s not the law that needs changing – it never will  be on this point – but the whole profit system that needs dumping.