Monday, May 3, 2021

Letter: The Capital Levy. (1923)

Letter to the Editors from the October 1923 issue of the Socialist Standard

To the Editor of the Socialist Standard.


In your issue of August last you express your opposition to the Capital Levy and to my line of reasoning in defence of it. With your permission I propose to answer your criticism, and will be as brief as I can.

To begin with, let us see how far we are in accord. Firstly, I agree that “a small class does own the bulk of the means of producing wealth in this and other capitalist countries.” In my book on “The Capital Levy” I have demonstrated this (for Britain) by overwhelming figures.

Secondly, I agree that this small capitalist class in the main controls to-day the political machine. Thirdly, I agree that capitalists pay wages not because they are philanthropists, but because they are compelled by economic forces. Finally, I agree that the system of capitalism has many inherent evils and that there is no way out except by Socialism.

I do not agree with you however either (1) that under capitalism the workers as a whole have no “surplus over their minimum needs,” or (2) that under Socialism the burden of the National Debt will be automatically lifted.

With regard to (1), you yourself in another part of your article recognise that wages must be “broadly regarded” as based for “different section of workers under different climatic conditions, and with different social standards and different lines of historical development on their standard of living.” This is surely a much more elastic view than is implied by the words “minimum needs.” But, even so, I cannot admit your case. What I will admit is that standard of living and weekly wages are intimately connected. Take two men—a skilled mechanic earning £4 and a labourer earning £2 10s. The family of the former have a standard of living at the £4 rate, while that of the latter live at the £2 10s. rate. I suggest it is much nearer the truth to say that the standard of living depends on the wages, than that the wages depend on the standard of living.

If you ask me, “On what then do wages depend?” I will answer in your own words, “on the economic forces,” and these economic forces include such complex questions as the amount of unemployment, the state of trade, foreign competition, world prices, and so on.

Of course, this distinction between us is vital, for if once it is recognised (as I hold) that wages depend on something other than an automatically-assessed standard of living, then the worker is vitally interested in the lightening of the load of taxation, and stands to gain by a Capital Levy, which will enable taxes on tea, coffee, cocoa, sugar, etc., to be taken off, and that on tobacco reduced. If, on the other hand, you are right, it would make no difference to the workers if the income tax, super tax, death duties, etc., were done away with, and all the revenue were collected from beer, tobacco, tea and the food of the workers. I would remind you that the apologists for the old French Aristocracy took this view in the middle of the eighteenth century and that the revolution followed.

Turning now to the other principal difference between us, I submit that even under Socialism there will be many important problems to be solved. I would remind you that Socialism does not imply the equal subdivision of all wealth, nor the collective ownership of all wealth. But unless Socialists are prepared to tackle the grave evil of maldistribution they will seriously disappoint their supporters. The first step in this direction is to get rid of the National Debt by placing it on the holders of the existing wealth of the country ; and I submit that this step if not already taken during the establishment of Socialism would certainly have to be taken immediately afterwards.

I should exceed the space you can afford me if I were to attempt to answer all the minor points you have raised, but as these two major differences go to the root of the whole matter they will probably suffice.

Yours, etc.,

I must first point out that I did not say that the workers have “no surplus over their minimum needs,” although, as a matter of fact, few of them indeed are able to accumulate any property worth mentioning. What I did was to take two alternatives—”the workers either receive a surplus … or they do not “—and to try to show that, whichever be correct, taxation could not affect them as a class. It was not necessary to say which is correct, and I did not do so, as without further explanation of “minimum needs” such an assertion would be misleading.

The assertion I did make was that referred to by Mr. Pethick Lawrence as “a more elastic view,” and I hoped when I wrote it that I had make it quite clear that the workers’ standard of living is not in my opinion “an automatically-assessed standard of living,” but is “elastic.” It is the resultant of a number of factors which change continuously, and moreover which include the workers’ political knowledge, assertiveness, and mental independence.

I need not labour this further or deal with Mr. Lawrence’s discussion of the relation of wages and the standard ol living, because I think he has not gone to the root of our disagreement. I will therefore restate my view.

The standard of living is not measured simply by the amount of money wages received. It consists of the amount of real wealth, food, clothing’ and shelter, etc., finally consumed by the working class. The relation this amount bears to the whole product of the labour of the workers depends at any given time on the interaction of the “economic forces.” The capitalists, who are the legal owners of the whole, give to the workers just as much as they are compelled to give. Now, unless the Capital Levy disturbs this equilibrium of forces in the workers’ favour, their standard of living will not be improved. Or, as I put it in my article, “Would the capitalists, if there were no taxation at all, give the workers a larger share of the wealth produced, and if so, why?” This basic question has not been answered.

To say that some workers or all workers receive £4 and have to return £1 as taxes, only means that at the given moment £3, and not £4, is the money value of the standard of living produced by the existing forces. If that were not so, the workers would be able to demand and to get an increase of, say, £1 per week. Their ability to make such demands is limited always by the control the capitalists have over the key position, the political machinery.

Of course, Socialist Society will have its own problems to solve, but the National Debt will not be one of them. We are some of those rare people who, in spite of calling themselves Socialists, actually desire Socialism. Under Socialism—that is, a “system of society based upon the common ownership and democratic control of the means and instruments for producing and distributing wealth”—there will be no room for individuals to live by their ownership of some of society’s resources. We do not aim at the “equal” (or unequal) “subdivision” of anything; nor would we be so foolish as to advocate the “collective ownership of all wealth.” Wealth, as distinct from the means of producing wealth, does not permit of being collectively owned.

In view of Mr. Pethick Lawrence’s subsequent remarks, I must dissent from his opinion that he and I are agreed that, “there is no way out except by Socialism.” To me his “way out” seems to be merely a way cut into the wilderness. The Capital Levy is not Socialism ; it does not lead to Socialism ; and it still remains to be shown how its introduction would in any way better the position of the working class within the capitalist system.
Edgar Hardcastle.

[Mr. Lawrence can, if he wishes, have space to explain further his position and to deal with the points raised in the reply.]

Fiction and Fact. (1923)

From the October 1923 issue of the Socialist Standard 

“If labour were going to establish their position in this country there must be no class of society which they could not touch. The time would come when labour would not be content to live under the old conditions. They needed more colour, more art, and romance and beauty, more pageantry and processions and music and dance to make themselves a power in the land.”
J. Ramsay MacDonald, in an address to a Labour gathering at Neath, Briton Ferry and Port Talbot.  Daily News. 7/5/23.

How these flunkeys of capitalism delight in clouding the class struggle. Here is another one on the same stunt:
 “The Labour Party is no longer a class party. It includes aristocrats and democrats, manufacturers and professional men among its representatives. Mr. H. G. Wells’ arrival among us is significant and valuable.”
Mr. John Hodge, Labour M.P., writing in the Star. 27/2/23.

“Whoever has come to a full consciousness of the nature of Capitalist Society and the foundation of modern Socialism knows also that a Socialist movement that leaves the basis of the class struggle may be anything else, but it is not Socialism.”

“No compromise—no political trading.”

Quotes. (1923)

From the October 1923 issue of the Socialist Standard 
Might is Right. 
  “Between equal rights force decides. Hence it is that in the history of capitalist production, the determination of what is a working day presents itself as the result of a struggle, a struggle between collective capital, i.e., the class of capitalists, and collective labour, i.e., the working class.”
Karl Marx.

  “The rich will not move without ‘capital’ ; a goad—I have and hold—you shall hunger and covet—until you are strong enough to force my hand.”


A rebuke for those who cannot think.

  “Science gives us the conscious domination over things and unconditional security in handling them.”
Joseph Dietzgen.


The Freedom of the Press!
  “Journalists are the tools and vassals of rich men behind the scenes. We are the jumping jacks. They pull the strings and we dance. Our talents, our possibilities, our lives, are the property of other men.”
Jerome K. Jerome. (The New Witness. 9/2/23.) 

MacDonald’s hypocrisy. (1923)

From the October 1923 issue of the Socialist Standard 

A minor storm hath arisen in one of the London districts in connection with certain past actions of one Ramsay MacDonald.

Some of our members in the district in question asserted in discussion that MacDonald had backed Sir John Brunner’s Bill to Amend the Education Acts and thereby increase child slavery.

A Mr. Easton took up the point and, apparently so staggered at the suggested duplicity of his “honourable Leader,” wrote MacDonald on the matter. Below is a copy of what appears to be the second letter Mr. Easton wrote MacDonald :

Mr. Ramsay MacDonald, M.P

Dear Comrade,

You will remember I wrote you a little while back re certain charges made against you by the Socialist Party of Great Britain. You suggested I should demand specific evidence. They have brought to our Branch of the I.L.P. a copy of the “Socialist Standard” for July, 1906, wherein is quoted an article of Frank Rose in the “Clarion” stating that you back Sir J. Brunner’s Bill to allow children to be worked by the capitalists. That is the charge, you would help the cause if you will give your reply. I think you were then General Secretary of the I.L.P., 1 am not quite sure.

I hope you will not think me impertinent in following up this matter.

All best wishes.
Your faithful comrade,
(Signed) Fred Easton. 
July 25th, 1923.

Readers will notice that the charge contained in the letter is, “that you backed Sir John Brunner’s Bill to allow children to be worked by the capitalist.” To this charge Macdonald replied as follows :

My Dear Easton,

Thank you very much for all the trouble you have taken. The statement that I backed a Bill of the nature described is nothing but a fabrication. I cannot remember the provisions of Bills I backed in 1906, but I know this perfectly well, and I think that I can ask you to accept my attitude on education and child labour as a proof of my statement, that whatever Bill I backed was to protect children from the capitalist and to give them a better chance of education.

From time to time, the section whom you are now fighting has misrepresented—sometimes on account of their ignorance, but not infrequently on account of their malice—things I have said and done, and I can assure you this is an instance of it.
Yours very sincerely,
(Signed) J. Ramsay MacDonald.
July 25th, 1923.
His reply to the charge, then, is, in the first place, “The statement that I backed a Bill of the nature described is a fabrication.”

Before the Brunner Bill was introduced into Parliament 12 and 13 were the earliest ages at which children might be partially exempted from attending day school.

In May, 1906, Sir John Brunner asked leave to introduce a Bill to amend the Education Acts. The description on the back of this Bill runs as follows :



To amend the Education Acts, 1870 to 1903. Presented by Sir John Brunner,
supported by
Sir William Anson, Mr. Burt, Mr. Butcher, Mr. Cameron Corbett, Mr. Crooks, Mr. Eve, Mr. Ramsay MacDonald, Mr. Masterman, Mr. George White, Mr. Whitley, and Mr. Yoxall.

Ordered by the House of Commons to be Printed 21st May, 1906.

Printed by Eyre and Spottiswoode, etc., etc. [Bill 220.]

On the cover (or first page) of this Bill it states :
  “This Bill provides that local authorities may fix thirteen as the minimum age for total exemption from attendance at a public elementary school if they frame bye-laws for the attendance of children so exempted at some recognised continuation school for at least three evenings a week until they attain the age of sixteen years. In the rural districts it is provided that the local authorities may fix twelve as the minimum age for total exemption in the case of boys who have definite and regular agricultural employment, and whose parents desire that they shall be so employed, on condition that they attend a continuation school for at least two evenings a week during the winter months until the age of sixteen.”
Page 1, Clause 1, contains the two para¬graphs covering the above two points.

It will be seen that, where formerly children were only partially exempted from day school attendance, i.e., half-timers, this Act gave them total exemption, thus allowing them to be worked, their whole day, in the mind and body destroying atmosphere of modern industry at an earlier age than formerly, and thereby increasing the amount of child slavery—the essence of the charge against MacDonald.

He “cannot remember the provision of Bills I backed in 1906.” Oh, perfidious politician ! Was it then of such small account as to be easily forgotten, this attempt to smother youthful bloom in factory hells? The brutalisation of childish minds; the maiming and dwarfing and mis–shaping of tiny limbs under the influence of the machine?

Not content with working children of such an early age, the whole day long they must needs complete the diabolical work by driving them to school in the evenings, instead of allowing them this small opportunity for the rest and amusement so essential to childhood. They take away the child’s opportunity of acquiring education during the normal time—the daytime—and seek to pump knowledge into him when he is too tired to think. And this is done in the interests of those who want cheap labour.

Imagine the harm suffered by a child leaving the suffocating atmosphere of a factory to work in the close atmosphere and artificial light of a schoolroom ; or leaving the backaching work of the fields to stoop over a desk and cramp little fingers striving to form letters ; or leaving the work of a long day of concentration upon work under a foreman or overseer to force the wandering thoughts to concentrate upon figures under the exacting rules of the schoolroom.

Was this action of MacDonald’s such as “to protect children from the Capitalist and to give them a better chance of education” ?

As to the “better chance of education,” the harm done to the general health and mental capacities of children in the towns where the half-time system nourishes has been frequently dwelt on. Educational experts have pointed out that the children come to school tired and sleepy and lose education during the most important time of their lives ; and of this MacDonald, as a one time teacher, must have been well aware.

To estimate more fully the depth of MacDonald’s treachery one should consult the Report of the Thirteenth Annual Conference of the I.L.P. (1905), page 55, and read clause 5 of their programme of “demands,” which demands—
“The raising of the age of child labour, with a view to its ultimate extinction.”
Compare this “demand” of the party of which he was secretary with the terms of Brunner’s Bill which he backed, and it will be easy to decide from whence comes the “fabrication.”

No wonder Macdonald said, at a Westbourne Park Fellowship meeting on March 12th last:
  “The work of the politician was one long experiment with truth.”—(“Daily News,” 12/3/23.).
If Mr. Easton wishes the evidence of his eyes to verify the statements quoted above, he can obtain it in two ways. Either obtain the Brunner Bill from the Government stationery office, or visit our Head Office and examine the document by arrangement with the General Secretary. The same remark applies to other “unbelievers.”

“Agriculture and the Guild System” (1923)

Pamphlet Review from the October 1923 issue of the Socialist Standard 

Agriculture and the Guild System.” By Montague Fordham. 24 pages, price 4d. I.L.P., 308, Grays Inn Road.

Mr. Fordham summarises his proposals in a paragraph, thus (p. 9) : —
  “… we have to secure Democratic Control of agriculture, the limitation of the rights of private owners over the land, the establishment of just prices and just pay, and the replacing of the dealers and other middlemen by co-operation. Then, we can get what we should have been aiming at all the time—farming for food, with a reasonable return, many well-paid workers on the land, and the economic basis for restoration of a jovial country life.”
He sees, however, that the bear has to be caught and killed before it can be skinned.
   “It is quite unwise to suppose that what is substantially an agricultural revolution can ever begin, whilst power remains in the hands of the landlords, large farmers, land agents, solicitors, bankers, dealers and middlemen.” (Page 10.)
He tells us also on page 10 that control cannot be obtained through the Trade Unions, but does not tell us how it is to be obtained. He skips this, and goes, straight on to tell us what the parish will do when control has passed “out of the hands of the landlords” into those of a “National Chamber of Agriculture . . . responsible to Parliament alone.” As the owning class control Parliament, we have in fact first to capture that seat of power— a detail Mr. Fordham apparently overlooks. It is by no means an unimportant detail, because the present ruling and owning class, will never willingly yield to any denial whatsoever of the rights of private property. They may be willing to listen to suggestions, for the better ordering of their economic system, and one section of the capitalist class may be not only interested but quite enthusiastic about a harmless-looking scheme which will in effect enable them to plunder some other section. It will be .noticed from Fordham’s statement quoted above that he is not proposing to destroy private ownership, only to “limit” it; and behind some interesting, but quite irrelevant, discussion of the economic machinery operative under the total different conditions of the Guilds in Mediaeval England, we find that Fordham’s suggestion is simply a form of indirect subsidy. He adduces arguments which he considers should weigh sufficiently with the financial and industrial capitalists to make them willing to maintain the agricultural industry, temporarily at least, out of their profits. Since the eighties of last century British agriculture has been badly hit by competition which arose when railways opened up the interiors of North and South America and, later, Russia, thus making it possible to ship foodstuffs to industrial Europe. The first two had virgin soil needing no fertilisers, and so vast as to permit extensive cultivation, and the wheat from all three was put on the home market at a price which forbade profitable arable farming except under very advantageous conditions. This was profitable for the manufacturers, for whom cheap food meant low wages. They had discovered this in 1846, when they repealed the Corn Laws. Incidentally, the ruin of agriculture and the depopulation of the countryside was also good for them, as it increased the supply of cheap labour in the towns.

But during the present century this supply of cheap food from abroad has shown signs of decreasing. Railway freights in U.S.A. have steadily risen, virgin soils are being exhausted, and intensive cultivation has had to be substituted, while the growing industrial populations of these countries are coming to need all their home supplies. Russia has left the market, and, curiously enough, in that country now we have just the reverse of the policy Mr. Fordham suggests. The Bolsheviks are driven to subsidise their bankrupt industries out of agriculture. Whether they can succeed in such a policy will depend on their maintaining their control of the Government. They are at least realists, but Mr. Fordham thinks he can carry out his scheme without capturing political power.

In view of the changing agricultural situation, the British industrial capitalists have had to consider of recent years whether it would not be worth their while artificially to stimulate agricultural production by subsidies, in fact of the declining quantity and threatened rising price of foreign wheat. The problem was temporarily brought to a head during the war, when a bonus was given for the growing of wheat and oats, coupled with a statutory minimum wage for agricultural labourers. The whole of this machinery was scrapped in October, 192l. Mr. Fordham does not want the re-introduction of the Corn Production Act, but he wants prices to be “stabilised” and “a just price to be based on cost of production.” This, he thinks, would also cut out the middleman who at present gets the bulk of the retail prices of farm produce, and lead to the formation of Distributive Cooperative Societies.

Fordham admits that the limitation of imports would be necessary, which means that prices would, in spite of his statements to the contrary, be raised above world prices to benefit agriculturists. In short, through all the fog of Mr. Fordham’s reasoning we see that the essence of his case is that the industrial and financial capitalists are to be asked to dip their hands in their pockets to guarantee to farmers the average rate of profit on their capital.

The necessary adjunct of capitalist private ownership, the wage system, is to remain, but wages of labourers are to be secured at an “adequate” level by the price-fixing authority.

The introduction of this scheme will depend, while the capitalists remain in power, on their view as to whether the economic, political, and military gains to them justify the expenditure. Mr, Fordham should therefore offer his advice to the proper quarter.

As Mr. Fordham says (page 6), various things will happen, “If the British Government will give facilities,” etc., etc. There is just one thing for which the British Government will not give “facilities” ; that is Socialism. It yet remains to be shown by Mr. Fordham how a slave class can improve its position except at the expense of its masters, or how propertyless workers can emancipate themselves except by appropriating for the use of society the private property of the present owners.

If the workers capture political power for the purpose of introducing Socialism, they can, in abolishing capitalism, also sweep away the minor evils and problems of organisation which worry Mr. Fordham.

I notice with amusement that he receives most flattering notices from G. K. Chesterton and A. J. Penty. Chesterton once remarked of Penty that he was one of the two or three really original minds of our day. I wondered then who was the third. It now only remains for Mr. Fordham to say something really nice about Chesterton.

Personally, I wish all of them would find some little hell of their own on which to inflict their precious schemes for the Feudalisation of society. The workers would do far better to learn something about capitalism as it really is to-day, than to be misled by the fantastic pictures of Mediaeval Europe drawn by these three romantic humbugs.
Edgar Hardcastle