Who benefits from lower ‘Third World’ wages? (2021)

From the March 2021 issue of the Socialist Standard

We conclude our series refuting the view that workers in the developed capitalist parts of the world exploit workers living in the ‘Third World’.

Third Worldist ‘anti-imperialism’ basically contends that the interests of workers in the Global North are objectively aligned with the capitalists there in seeking to perpetuate the ‘super-exploitation’ of the Global South. Allegedly, this super-exploitation has the effect of raising these workers above the status of an exploited class by enabling them, via a process of ‘unequal exchange’, to receive the full value of their labour contribution.

As Jason Hickel explains:

‘It was the Egyptian economist Samir Amin – a well-known critic of neo-colonialism – who first articulated this argument in the 1970s. He noticed that that if we look at the labour that goes into producing goods for trade between the south and north, we see that workers in the south are paid much less than their northern counterparts – even when adjusted for productivity or units of output per hour. This means that when the north buys goods from the south, they pay far less than those goods would otherwise be worth. In other words, the north effectively siphons uncompensated value out of the south’ (Guardian, 18 May 2017).

While this explanation might seem superficially plausible, there is an intrinsic problem (as we saw last month) with trying to quantify the magnitude of this global transfer of value – let alone quantify the extent to which workers, as opposed to capitalists, in the north allegedly benefit from this transfer – due to value being based on the elusive notion of ‘abstract labour’. Hence the use of price as a surrogate measure. But while the sum of all values must equate with the sum of all prices, for any given commodity, value and price must necessarily diverge under conditions of disequilibrium resulting from the continual adjustment of supply and demand to each other.

Take the commodity, labour power – the skills the worker sells to the capitalist. Its price is the wage that worker receives. However, this transaction is conditional upon the capitalist expecting to make a profit by employing the worker. A business is not a charity. It is not concerned with the well-being of its workforce as such. Competition between businesses pushes such sentiments aside and imposes on all the overriding need to secure a profit.

Without profit the business risks being bankrupted. This is as true in the Global North as in the Global South and it is surely significant that the overwhelming bulk of capital – even foreign direct investment – originating in the North is invested there and not in the South. That wouldn’t happen without the prospect of profit.

Profit is the money form of the economic surplus the worker produces in exchange for a wage. She produces more value than she receives in her wage. Hence she is ‘exploited’. It doesn’t matter whether she is ‘well paid’ or not. Whether she can ‘purchase the product of ten hours of another worker’s labour through one hour of her own’ as Zac Cope puts it, is simply not relevant (Divided World Divided Class: Global Political Economy and the Stratification of Labour Under Capitalism, 2012, p.173) Her means of purchasing that product – her wage – is conditional upon her producing a surplus for her employer in the first instance and, thus, being exploited.

Wage levels and the rate of exploitation

What determines the ‘rate of exploitation’ cannot simply be inferred from the level of wages paid to workers; it must take into account, also, their productivity. Paradoxically, higher paid workers can be subject to a higher rate of exploitation if the ratio of the surplus they produce compared to the size of their wage packet is higher than in the case of a low-paid worker. However, this can change if you reduce the wages of the low-paid worker thereby increasing his rate of exploitation.

Commentators, like John Smith, argue that depressing wages below their value in the Global South – super-exploitation – is now the primary mechanism under capitalism for increasing the rate of exploitation (Imperialism in the Twenty-First Century, 2016). Capital is highly mobile today while labour, hemmed in by national borders, is relatively immobile. This obstructs the equalisation of international wage rates (but not the equalisation of profit rates whereby surplus value is siphoned out of the Global South). Multinational corporations can play one poor country off against another in their quest for lower production costs while a corrupt ‘comprador bourgeoisie’ running these countries assists in this race to the bottom by imposing political repression and banning trade unions.

This argument has merit but, still, we cannot overlook differential rates of productivity. According to Hickel:

‘Southern workers are probably at least as productive since these days many of them work in foreign-owned factories (think of Apple’s iPad factories with highly efficient technology and rigid Taylorist rules, designed to extract as much as possible from every movement).’

Clearly, this is just cherry-picking. The vast majority of Southern workers don’t work in foreign-owned factories. Some do and, doubtless, productivity in these cases matches Western levels. But you have to look at the situation across the country as a whole to get a more realistic picture.

Even in an emerging industrial powerhouse like India, the formal sector accounts for only 10 percent of the workforce, the rest working in the informal sector. Globally ‘a staggering 2 billion workers are in informal employment, accounting for three in five (61 per cent) of the world’s workforce’ (ILO, World Employment Social Outlook: Trends 2019).

These are overwhelmingly concentrated in the Global South. Given the paucity of formal sector jobs and the lack of unemployment benefits, workers here often have little option but to eke out a living in the low-paid informal sector. This is characterised by rampant ‘underemployment’ and relatively inefficient small-scale ‘involutionary’ forms of activity.

There is some truth in Hickel’s claim that ‘wages are not somehow naturally low in the south – they have been made low by design. Wages are an effect of power’. But his explanation is incomplete. The bargaining power of those workers is, in turn, undermined by the depressing effect on wages caused by mass unemployment and, even more, underemployment, which is much more pronounced in the South.

The much larger ‘industrial reserve army’ also helps to explain the persistence of generally more labour-intensive forms of production there and, by extension, the significantly lower per capita productivity. According to the ILO there is a strong correlation between output per worker and international variations in wage rates (bit.ly/2OhfIK2).

Indeed, Marx himself maintained that ‘The more productive one country is relative to another in the world market, the higher will be its wages as compared with the other’ (Theories of Surplus Value, Ch. 8). Key to this is raising the ‘organic composition of capital’ via mechanisation thereby bringing about a fall in the rate of profit.

Ironically, Cope himself contends that ‘the capitalist system has been able to maintain itself in recent decades’ only because, among other things, ‘industrialisation of large parts of the Third World have ensured the entry of millions of (super-)exploited workers into the global workforce. This has undoubtedly raised the rate of profit by reducing the rate of growth of the organic composition of capital’ (ibid p.201). So he is effectively conceding that production there is more labour-intensive and we can assume this means less productive in per capita terms.

There is a further point to consider. As we saw earlier, part of Cope’s argument rests on the claim that most Northern workers are ‘unproductive’ in the sense that they do not produce, but are financed out of, surplus value. But what of the Global South? While some workers in the small formal sector could be classed as unproductive – for example state employees – in the much larger informal sector the predominant form of labour – 70 percent in sub-Saharan Africa – is ‘self-employment and unpaid family work’. Strictly speaking, this does not constitute productive labour either since it does not involve what Marx called the ‘exchange of capital for labour’ which is a precondition for such labour being considered ‘productive’.

However, to reiterate – being ‘unproductive’ does not mean not being exploited. ‘Being exploited’ does not depend on you being directly involved in producing surplus value but rather on your functional contribution to a wider system of surplus extraction.

Furthermore, even if 80 percent of the world’s productive labour is ‘performed in the Third World by workers earning less than 10% of the wages of First World workers’, as Cope claims, one should bear in mind that at least 80 percent of the world’s population lives in the Third World anyway.

As for workers there earning less than 10 percent of the wages of First World workers we need to relate this to international differences in price levels. In this regard, the position of Third Worldists comes across as muddled.

On the one hand, we find Cope suggesting that workers in the Global North benefit from the ultra-cheap prices for goods produced by super-exploited workers in the Global South; on the other we are told by him that ‘as soon as these goods enter into imperialist-country markets, their prices are multiplied several fold, sometimes by as much as 1,000%’(p. 159). This is because the capitalists there can ‘afford’ to pay their workers higher wages to buy these goods which presumably means they are making a profit by employing them.

Who benefits from lower import prices?

Wages, being the price of labour power, will tend to adjust to changes in the prices of other commodities. Cheapening the price of imports into the North by intensifying the exploitation of Southern workers will not materially benefit workers in the North. Actually, if anything, it has induced capitalists to outsource production to the South and close down factories in the North at the expense of northern workers.

Like water finding its own level wages will ultimately tend to gravitate towards the value of labour power. Marx’s observations on the early nineteenth-century struggle to repeal the Corn Laws which restricted food imports to boost domestic prices are pertinent here:

‘The English workers have very well understood the significance of the struggle between the landlords and the industrial capitalists. They know very well that the price of bread was to be reduced in order to reduce wages, and that industrial profit would rise by as much as rent fell’ (bit.ly/2LvHt0p).

While it is undeniable that there are marked differences in wage rates between the North and South there are some suggestions that the gap may be closing. A report in the Economist noted that while wage growth in the advanced countries has been slight or stagnant: ‘The crucial change that has taken place over the past decade or so is that wages in low-cost countries have soared’ (19 January 2013). Ironically this has encouraged a limited ‘reshoring’ of manufacturing back to the US where wage stagnation has made US manufacturing slightly more competitive.

Of course, we are still quite a long way off from the ‘equalisation of international wage rates’ but current developments seem to be tending in that direction. In Asia, for example, wages have been growing annually nearly ten times faster than in the world’s richest nations (Nikkei Asian Review, 28 November 2018).

Moreover, if you apply ‘purchasing power parity’ exchange rates to reflect the varying costs of buying an identical basket of goods in different countries, the gap between rich and poor countries narrows considerably. Cope himself notes that ‘according to calculations based on data compiled by the Union Bank of Switzerland, OECD wages have an average 3.4 times more purchasing power than non-OECD wages’ (p.163).

This is far less than the cited ratio of 1:11. This difference can be adequately explained in terms of factors already discussed such as differential productivity rates. But compared to the difference in purchasing power between capitalists and workers everywhere in the world, it is pretty negligible.

It is this fundamental class division that the proponents of Third Worldist ‘anti-imperialism’ wilfully obscure in their pointless pursuit of a reactionary nationalist agenda in an age of global capitalism.

Robin Cox

Rear View: Dirty (2021)

The Rear View Column from the February 2021 issue of the Socialist Standard

Dirty

Writing of manual scavenging – ‘the age-old unfortunate practice of cleaning, carrying, and disposing human excreta from dry latrines or sewers into the disposal sites’ – in India (countercurrents.org, 24 December), Ashish Joshi notes that ‘. . . despite prohibitive legislations in place, a government survey from 2019, carried out across 170 districts, found that over 54,000 people actively engage in the practice. In 2019 alone, 110 people died while cleaning septic tanks and sewers. For a job that has been outlawed for years, the manual practice continues without providing even the essential safety equipment that must be provided to the people engaging in this dangerous job. It is regrettable for a country that has been to Mars and back that we still have not eradicated this sordid practice from our societal fabric’. Eclipsing the Mars mission in terms of speed and potential is the development of vaccines against a pandemic that daily kills 10,000 people. Mainstream media, however, largely ignores the 25,000 who die every day from unnecessary starvation, the 3,000 children who die every day from preventable malaria, and the 10,000 people who die every day because they are denied healthcare. Neglected tropical diseases are common in 149 countries, and affect more than 1.4 billion people (including over 500 million children). Their eradication is possible but not profitable.

Rotten

‘There must be something rotten in the very core of a social system which increases its wealth without diminishing its misery . . .’ This comment is as valid today, quite possibly more so, than when it first appeared as part of the introductory sentence to an article penned by Marx in the New York Daily Tribune of 16 September 1859. He observed that the ‘Irish famine of 1846 killed more than 1,000,000 people, but it killed poor devils only. To the wealth of the country it did not the slightest damage’ (Capital, Vol. 1, p.658). Fast forward 175 years and we learn that despite the misery of millions, the ‘net worth of US billionaires has soared by $1 trillion to total of $4 trillion since pandemic began’ (americansfortaxfairness.org, 9 December 2020). ‘Their pandemic profits are so immense that America’s billionaires could pay for a major Covid relief bill and still not lose a dime of their pre-virus riches. Their wealth growth is so great that they alone could provide a $3,000 stimulus payment to every man, woman and child in the country, and still be richer than they were nine months ago.’ The journalist A R MacLeod tweeted (21 December): ‘The word “missile” appears 19 times in the COVID Relief Bill. “Aircraft” appears 208 times. “Munition” 46 times. “weapon” 46 times. “Healthcare” = 24. “doctor”/”nurse” = 5. “masks” = 0.’ And asked: ‘Who and what exactly is this bill really for?’ Indeed.

System

Comparing Boris Johnson’s ‘incompetence’ with that of WWI General Haig, Patrick Cockburn (counterpunch.org, 22 December) writes: ‘The estimate for excess deaths in Britain caused by government failings during the first and second waves of the epidemic now total about 50,000 people, adding together the estimates from Sir David King and the Sunday Times report, a number that will inevitably increase in the coming months.’ Johnson’s failings are really those of capitalism at work and are found worldwide. Mexico’s excess deaths passed 250,000 in December, and ‘Overall, a lower survival from COVID-19 was evident in the poorest population groups. Therefore, combating extreme poverty deserves to be a central prophylactic strategy’ (mdlinx.com, 24 December 2020). Mexico is just one of many countries where our class has a worse survival rate because of poverty. Band-aids, whether plasters or pop stars, offer no solution. Neither do platitudes from Oxfam: ‘No one should be blocked from getting a life-saving vaccine because of the country they live in or the amount of money in their pocket. But unless something changes dramatically, billions of people around the world will not receive a safe and effective vaccine for COVID-19 for years to come’ (medicalnewstoday.com, 18 December). Dr. Rosa Luxemburg offered us a prescription in 1918: ‘During the four years of the imperialist slaughter of peoples streams and rivers of blood have flowed. Now we must cherish every drop of this precious juice as in a crystal glass. The most sweeping revolutionary action and the most profound humanity—that is the true spirit of socialism. A whole world is to be changed. But every tear that is shed, when it could have been staunched, accuses us’.

System change 

Professor Riccardo Petrella in an article titled Health for all? (wsimag.com, 21 December 2020) writes: ‘The fight against impoverishment remains a policy of aid, of charity, not a fight to eradicate the structural factors that cause impoverishment; the countries that signed the Treaty of Paris undertook to allocate 100 billion a year from 2020 to the fight against climate disaster. Well, none of the powerful dare to say where the 100 billion is; we know, however, by whom and where the trillion and 800 billion were spent in 2019 on armaments, 25 percent of which would be enough to cover all the above-mentioned financial needs. Finally, we know that military spending will not decrease in 2020.’ John Boyd Orr, former director of the Food and Agriculture Organisation, was candid in stating: ‘a world of peace and friendship, a world with the plenty which modern science had made possible was a great ideal. But those in power had no patience with such an ideal. They said it was not practical politics’ (Daily Herald, 29 July 1948). A post-capitalist world of peace and plenty has long been possible. Let us make it so.

Unequal exchange: who benefits? (2021)

From the February 2021 issue of the Socialist Standard

We continue our examination of theories which claim the workers in the advanced capitalist countries share in the exploitation of those in ‘The Third World’.

In Imperialism: The Highest Stage of Capitalism (1916) Lenin suggested that some workers in the advanced countries, comprising a ‘labour aristocracy’, were bribed out of the ‘enormous superprofits’ made in the ‘colonies and semi-colonies’. While this claim is questionable at many levels he did at least acknowledge such superprofits were ‘obtained over and above the profits which capitalists squeeze out of the workers of their ‘own’ country’, meaning workers there continued to be exploited in the Marxian sense.

Not so in the case of modern ‘Third Worldist’ exponents of the Labour Aristocracy thesis, like Zac Cope. Cope surpasses even Lenin in putting his own spin on this Leninist version of bourgeois trickle-down economics. In his view, workers in the advanced countries generally are not exploited at all:

‘It is commonly supposed by socialists that if a person earns a wage she must, ipso facto, be exploited. However, if one worker is able to purchase the product of ten hours of another worker’s labour through one hour of her own, then that worker is benefiting materially from the exploitation of the other worker. In other words, where the labour content of the worker’s consumption is in excess of the amount of labour (value) she supplies, she partakes in the exploitation of her fellow worker’ (Divided World Divided Class: Global Political Economy and the Stratification of Labour Under Capitalism, 2012, p.173).

If this worker is not exploited then presumably Cope will agree that her capitalist employer is not making a profit by employing her. Which raises the question: why is she being employed?

According to Cope, producing surplus value is ‘increasingly the sole preserve of superexploited Third World labour’ (p.176). In short, almost all workers in the Global North are ‘unproductive’ meaning they are financed out of, rather than produce, surplus value.

True, most workers involved in manufacturing now reside in the Global South. However, productive labour is not limited to producing physical goods – a point Marx made in criticising Adam Smith’s overly ‘physicalist’ approach to the labour theory of value. Many services have been commodified under capitalism and the workers providing them must be considered productive of new value too.

More importantly, Cope departs radically from Marx in assuming that just because a worker is unproductive they cannot be deemed to be exploited. While unproductive labour may not in itself produce surplus value it is still nevertheless absolutely indispensable to the extraction of surplus value. A commodity’s value is only realised insofar as it can be sold but the labour involved in selling it is technically unproductive as it adds no new value.

Referring to clerks employed by a merchant capitalist, Marx observes:

‘The unpaid labour of these clerks, while it does not create surplus-value, enables him to appropriate surplus-value, which, in effect, amounts to the same thing with respect to his capital. It is, therefore, a source of profit for him. Otherwise commerce could never be conducted on a large scale, capitalistically’ (Capital Volume 3, Ch.17).

Saying unproductive workers are not part of the exploited working class is like saying the battalion signallers back in the army’s HQ do not belong to the army because they don’t do any actual fighting.

Unequal exchange

Let us now consider the claim that workers in the rich countries allegedly partake in the exploitation of workers in poor countries via a global ‘transfer of value’. This is said to involve various mechanisms – some hidden, some explicit.

These include, ‘transfer pricing’ or ‘trade misinvoicing’ practised within transnational corporations as a means of tax evasion; income flows in the form of repatriated profits, interest on loans, and property rents; ‘seigniorage’ and the profits made from circulating banknotes abroad and, finally, profits made from the buying and selling of financial assets abroad.

However, none of these examples in themselves seem to hold any obvious benefits for the workers in the rich countries. They all seem to work exclusively to the advantage of the capitalist owners of the businesses concerned. As Marx noted with reference to the repatriated profits made from foreign trade: ‘The favoured country recovers more labour in exchange for less labour, although this difference, this excess is pocketed, as in any exchange between labour and capital, by a certain class’ (Capital, Volume 3, Ch. 14).

But what about the mechanism alluded to by Cope – namely, ‘unequal exchange’?

This concept was developed by Arghiri Emmanuel, whose major work, Unequal Exchange: A Study of the Imperialism of Trade was published in 1972. Emmanuel saw unequal exchange as being embedded in various processes that were subjected to a tendency for profit rates to equalise under competitive capitalism.

To briefly explain. Just as the prices of particular commodities do not necessarily coincide with their values, so the profits a particular business makes do not necessarily coincide with the surplus value generated by its workforce. According to Marx, it is only at the economy-wide level (these days the global economy) that ‘the sum of all profits in all spheres of production must equal the sum of the surplus values, and the sum of the prices of production of the total social product equal to the sum of its value’ (Capital Volume 3, Ch. 12).

Since living labour is the sole source of profit – the money form of surplus value – a business with a high ‘organic composition of capital’ (‘capital intensive’) will tend to have a lower rate of profit than one using labour-intensive technology. Indeed, the falling rate of profit accompanying industrialisation of the advanced countries is often cited as a reason, historically, for the imperialist expansion of those countries into parts of the world where an abundant supply of cheap labour was said to make for higher profits to offset the falling profit rate at home.

However, under competitive capitalism these different profit rates will tend to equalise through the interactions of supply and demand for the goods in question. In so doing, commodities produced in labour-intensive industries (or parts of the world) would sell at prices below their values while, for capital-intensive industries, the opposite would be true. In terms of international trade this translates into a redistribution of surplus value from the Global South to the Global North.

This is one example of ‘unequal exchange’ but Emmanuel’s argument goes further: even if the ‘organic composition of capital’ was identical across the world, there could still be a transfer of surplus value from the Global South to the Global North. Why?

The reason lies with the sharp differences in wage rates between them which get to be reflected in the prices of goods exchanged in international trade. High-priced goods from the North are exchanged for low-priced goods from the South (whose capitalists then try to compensate for this by further cutting wages – super-exploitation). In this way some of the surplus value generated in the South is redistributed to the North, depriving the former of the ‘means of accumulation and growth’.

In a world in which capital is mobile but labour is mostly not – think of ‘Fortress Europe’ – the normal competitive process by which wages, the price of labour power, tend to gravitate towards value is effectively blocked by national borders which means other contingent factors can become more prominent in determining wage rates.

Sharing out surplus value

‘Surplus value’ is the key signifier of exploitation under capitalism. The rate of exploitation – s/v or the ratio of the surplus product to the overall wages bill – can be stepped up in several ways: (1) increasing ‘absolute surplus value’ by lengthening the working day; (2) increasing ‘relative surplus value’ by raising productivity (for instance through mechanisation) and (3) by pushing wages more or less permanently below the value of labour power – ‘super-exploitation’.

Marx did not rule out (3) but saw it as being less significant, historically than (1) and (2) in the genesis of capitalism.

While all three modes of increased surplus value extraction can operate concurrently, for modern proponents of the labour aristocracy thesis, super-exploitation (of the Global South) is easily the most dominant mode. However, even if this was the case, it does not follow that super-exploitation is confined to the Global South only; it is arguably to be found in the Global North too, notably in the guise of the low-wage ‘gig economy’.

Moreover, it is one thing to argue that super-exploitation in the Global South aids the redistribution of surplus value to the Global North; it is quite another to argue that workers in the latter benefit from this redistribution and not just the capitalists who in Marx’s words ‘pocket the difference’ arising from unequal exchange.

From a Marxian standpoint (which Cope professes to espouse), exploitation can be inferred from the fact that the working class as a whole produces more value than it receives in the form of wages and salaries. However, value itself is based on the concept of ‘abstract labour’, not concrete labour, and this distinction is absolutely crucial.

A commodity’s value is the ‘socially necessary labour time’ that goes into producing it, from start to finish, which is only revealed in a very approximate sort of way through market prices. It is an industry-wide – meaning global – average. Thus, attempting to isolate one section of the working class (the Global North) from another (the Global South) in order to calculate their relative contributions to the production of value – even if this was feasible – is methodologically suspect since what is then being measured is no longer, strictly speaking, ‘value’. Value is a social construct that only acquires resonance from the standpoint of the economy as a whole.

The point is that you cannot empirically measure a commodity’s ‘value’. It can only be theoretically inferred or guessed at. It is a constantly fluctuating potentiality that can change even after a commodity has been produced precisely because it is a notional average. So focusing exclusively on the labour contributions of workers in the South vis-à-vis the North strips it of that quality of being a notional average.

According to the labour theory of value it is not so much individual capitalists that exploit their own workforce but rather the capitalist class as a whole that exploits the working class as whole. This is because production today is a completely interconnected and globalised process. The fruits of this collective exploitation – surplus value – are, so to speak, pooled and redistributed to different capitals in proportion to their magnitudes as an average rate of profit.

Cope notes:

‘Firstly, of necessity, this essay utilizes statistical data that measure the results of transactions in marketplaces, not value-generation in production processes. GDP, or value-added, figures are obtained by subtracting the cost price of a firm, nation or region’s inputs from the proceeds of the sale of its outputs. This equation of value with price ensures that the process of production itself, and the surplus value arising from it, is rendered invisible and value appears to be generated largely through the circulation of money’ (p.157-8).

But the ‘equation of value with price’ is precisely what Marx himself ruled out, arguing that ‘The possibility, therefore, of quantitative incongruity between price and magnitude of value, or the deviation of the former from the latter, is inherent in the price-form itself’ (Capital volume 1, Ch. 3). It is only in their totality that values and prices equate.

Ironically, the very kind of statistical data Cope is forced to rely upon – ‘of necessity’ – refutes his claim that workers in the Global North constitute a non-exploited class. Thus, according to the Bureau of Labor Statistics, US factory workers in 2012 produced on average $73.45 per hour in output whilst the average hourly wage was only $23.32 (bit.ly/3hW62iX).

So approximately two thirds of the added value these workers contributed, they did not receive payment for. Indeed, since the 1970s, while productivity of American workers generally has grown by 69.3 per cent, wages have grown by only 11.6 percent (bit.ly/2LyJAzY).

Very clearly, then, not only are these workers exploited but the rate at which they are exploited has been steadily increasing.

Next month we conclude our series refuting the view that workers in ‘Global North’ share in the exploitation of those in the ‘Global South’.

Robin Cox

Letter: Turkish nationalists? (2021)

Letter to the Editors from the February 2021 issue of the Socialist Standard

Dear Editors,

I have to say that I am absolutely shocked to have come across a piece that subtly spouts Turkish ultra-nationalism in the magazine. I have always thought highly about this magazine but cannot comprehend how the piece ‘Candle in the Wind’ made it to the January edition? Really, how did that happen?

The author, of whom I have no prior knowledge, calls the founding father of the Turkish nation-state republic Ataturk a ‘democrat’, while Ataturk is held responsible for ethnic cleansing by millions of Kurds and other non-Turks in Turkey!

The history he has tried to ‘shed light on’ from a candle, and through which he makes his subtle dark propaganda is also inaccurate. There is no mention of brainwashing of the peasantry to the state’s imposed notions of ‘one nation, one flag and one language’, which led to massacres, we are talking massacre of civilian Kurds, Alevis and others. It was also the preparation of the new generation for massacres at the orders of the military generals in charge of a state, which outright denied the existence of tens of millions of other ethnic and religious communities in the country.

The author shamelessly declares that ‘the dream of Ataturk, Ismail Hakki Tonguc, Mahmut Nakal and many others of a secular education, based on the foundations of inquiry, science and rationality that is free and democratic …’ Any socialist with a slightest understanding of modern Turkey’s treatment of its workers and peasantry, and the tens of millions of non-Turks, would vomit after reading such lines of subjective propaganda beating the drums of Turkish republican nationalism, which seem to come from a Kemalist fascist apologist rather than ignorance.

Also, what the hell is with the Turkish flag printed with this piece in the magazine, why the hell is that there when the first line clearly states Turkey, Turkish, and Ataturk the father of the nation. And don’t sell me any insight into journalistic techniques of illustration which rejects displaying of flags even by its basic liberal standards.

The piece written under the guise of ‘enlightenment’ is an insult added to the injury of millions of non-Turkish workers and peasants, those whose memories of childhood haunts them to this day for they were forced to stand in line at school yards each day to shout out Ataturk’s slogan: ‘Happy is he who says I am a Turk’. That motto is to this day imposed at schools on Kurdish children across the country whose right to education in their mother tongue is suppressed with the Turkish state’s barrels of guns, drones and other weaponry.

I really did not expect this garbage, I am still shocked. Still can’t believe that the Trojan horse of racist Turkish ultra-nationalism has reached this party too. Unbelievable! I hope to see a report in the magazine to make it clear that the party does not share the view that Ataturk and other butchers in his circle were Turkish ‘democrats’ as the author of that piece had declared.

Aram Chya

The Writer Replies:

Reading this ‘critique’ of my article both surprised and shocked me. That anyone could find the story of an attempt to raise a population out of ignorance with a secular, rational, science-based education to be so contentious and nationalistic is puzzling. Being cast as a ‘subtle, dark propagandist’ for Turkish nationalism is lost on me, I’m afraid.

Kemal Ataturk

The use of certain words, in this case ‘Turk’, Turkish’, ‘Ataturk’, etc are always going to trigger an angry, out-of-context response from some corner or other. It is, perhaps, to be expected on social media but here, amongst the thoughtful readers of the Socialist Standard, less so. The context of the Village Institutes is a brief period of approx. 10-12 years in the history of the Turkish Republic.

This is indeed a story of a ‘Candle In The Wind’ – a system of education so radical, so egalitarian, so anti-elitist that the nationalists, the religious conservatives and privileged elites, joined together to destroy this model and those visionaries behind it before it destroyed them. Many of the educationalist visionaries along with many students were persecuted, imprisoned, exiled or fled – their reputations and lives in tatters.

Three minor points: (1) the flag is something that the editorial team should address [The Turkish flag was indeed just an illustration with no intended political significance; as far as we are concerned, all national flags are just rags on the end of a pole – Editors]; (2) the article was not addressing the current state of education or politics in Turkey; (3) nowhere did the article claim that Ataturk was a democrat.

The Socialist Party of Great Britain does not need to make any apologist statement – its position on nationalism has been clearly stated and is freely available. Socialism is about people and how they collectively choose to manage their affairs and the resources of the planet. No nation states, no money – from each according to ability, to each according to need.

I respectfully ask our correspondent to reread the article, if necessary substitute other names or another country and try to see it for what it is. In a world filled with bigotry, racism, nationalism, war and suffering we need ‘candles’ and we need candleholders – people who embrace other people and cultures.

Alan Fenn

Rear View: Tarred with the same brush (2021)

The Rear View Column from the January 2021 issue of the Socialist Standard

Tarred with the same brush

In an essay titled ‘Karl Marx was a racist misogynist – do not discuss’ we are told: ‘When it comes to neo-Marxist inspired cancel culture, rationality and reason fly out of the window to be replaced by politically correct ideology and cant . . . This latest campaign to rid the British Library of what is condemned as structural racism and white supremacism is part of a larger strategy associated with the death of George Floyd… ‘ (conservativewoman.co.uk, 26 November). Socialists are always keen to debate — anything, anytime, anyplace, anywhere could be our motto! — but those identified as ‘neo-Marxists’ and, it has to be said, Conservatives less so. Marx opposed racism and always insisted that ‘the emancipation of the productive class is that of all human beings without distinction of sex and race’ (1880 Preamble drafted by Marx to the Programme of the Parti Ouvrier). There is no doubt that black and ethnic minority workers overall have it tougher when it comes to police brutality and lack of opportunities in employment, education and housing. However, it does not follow from this that racism should be treated as an issue that is separate from capitalism and its class divisions. All racists and some feminists divide workers from each other. Along with reformists, they delay the day when, in the words of Oscar Wilde, one of the famous writers castigated for having links to slavery, ‘Socialism, Communism, or whatever, one chooses to call it, by converting private property into public wealth, and substituting co-operation for competition, will restore society to its proper condition of a thoroughly healthy organism, and ensure the material well-being of each member of the community’ (The Soul of Man under Socialism, 1891).

‘It’s about bloody time!’

‘Scotland becomes the first country in the world to pass landmark legislation offering free period products to anyone who needs them’ (dailymail.co.uk, 24 November). This is undoubtedly a positive step, particularly for members of our class experiencing period poverty, yet Scotland is just one of 195 countries in the world and the pace of reform is very slow and uncertain. We are informed that ‘ …70% of women in India… say their family cannot afford to buy sanitary pads. In fact… only 2 to 3 percent of women in rural India are estimated to use sanitary napkins as per 2016 data. This results in women resorting to unhygienic practices during their menstrual cycle, such as filling up old socks with sand and tying them around waists to absorb menstrual blood, or taking up old pieces of cloth and using them to absorb blood. Such methods increase chances of infection and hinder the day-to-day task of a woman on her period’ (countercurrents.org 28 October). Affordability, culture, distribution, and paucity of clean water all complicate matters as does the safe, environmentally friendly disposal of used pads. The author fails to address the obvious alternative of medically approved methods of menstrual suppression, where the need for pads, etc., is reduced or eliminated. Such alternatives are not free and do not register on the reformist radar.

Two steps forward, two steps back

Marx wrote, in a letter to Ludwig Kugelmann, dated 12 December 1868: ‘Everyone who knows anything of history also knows that great social revolutions are impossible without the feminine ferment. Social progress may be measured precisely by the social position of the fair sex (plain ones included)’.

‘Covid has resulted in a 20 percent increase in domestic violence and surprisingly misogyny is not a hate crime’ (thenorthernecho, co.uk, 24 November).

‘There were 1,575 individual women and girls who had an attendance where FGM was identified in the period between July 2020 and September 2020’ (digital.nhs.uk, 26 November).

‘Multiple private UK clinics selling intrusive ‘virginity tests’ and offering ‘hymen-repair’ surgery’ (inews.co.uk, 27 November).

‘Trans-women in police custody already suffered sexual harassment and abuse. Then came Covid-19’ (theguardian.com, 17 November).

‘Female LAPD Officer Details Sexual Harassment, Toxic Work Environment in Lawsuit’ (nbclosangeles.com, 9 November).

‘One in five men in the UK don’t believe that gender inequality is still a reality in society today… ‘ (independent.co.uk, 10 November).

Finland, under new (female) management

‘A year will soon have passed since Finland’s new coalition government headed by five women started work. It has dealt efficiently with the coronavirus pandemic, while drafting an ambitious Equality Programme – a programme that states, among other things, that everyone has the right to determine their own gender identity’ (bbc.com, 25 November). This is a reminder that women are just as capable of running society as men. Yet under capitalism, women have developed their potential for being every bit as destructive as men; they have become active participants in military carnage, fervent spouters of fake news and ‘alternative facts’ or superstitious nonsense and avid proponents of reactionary politics. In other words, the female of this species is becoming as brutalised as the male. Socialists know, however, without the support of a majority of women the establishment of a post-capitalist society is impossible. All wage slaves are members of the same class regardless of colour, gender and sexuality. We are a global class with identical class interests in all the 195 countries in the world. Marx’s son-in-law, Paul Lafargue, born in Cuba to French and Creole parents, provides this quotation: ‘The modern means of production can no longer be controlled except by society, and for that control to be established, they must first become social property; then only will they cease to engender social inequalities, to give wealth to the parasites and inflict miseries on the wage-working producers… ‘ (Social and Philosophical Studies, 1906).

Development to what? (2021)

From the January 2021 issue of the Socialist Standard

We resume our refutation of the view that workers in the advanced capitalist countries share in the exploitation of the people in the so-called ‘Third World’ by examining contemporary theories of this.

In the early post-war years large swathes of the world’s poor countries were decolonised. Seeking to complement their new-found political independence with a semblance of autonomous economic development, they soon found this was not so easily achieved.

The concept of ‘development’ has roots in nineteenth century thinking on the supposed civilising mission of the imperialist powers succinctly captured by Kipling’s patronising phrase: ‘white man’s burden’. Cynically, imperialism was justified as a means of uplifting native peoples everywhere — economically, spiritually and culturally — though, in reality, its impact was often the opposite.

The modern understanding of ‘development’ as a coordinated macro-economic strategy was first clearly associated with a ‘structuralist’ school of thought that emerged in Latin America in the 1930s centred on the Economic Commission for Latin America (ECLA). The structuralists argued against the Ricardian concept of ‘comparative advantage’ promoted by liberals who extolled the virtues of free trade and urged countries like Argentina to specialise in the export of agricultural products, capitalising on that country’s natural advantages.

The structuralists countered that there was a long term tendency for the price of agricultural products, to fall against imported manufactures because of the latter’s greater ‘elasticity of demand’. Meaning Argentina would be shortchanged in the long run due to a declining terms of trade if it focused only on producing beef and wheat for the European market. Therefore it made sense to adopt protective policies of ‘import substitution’ to stimulate the growth of local manufacturing.

Development economics

After the Second World War, however, such economic nationalist thinking found itself increasingly swimming against the tide. While import substitution continued to be implemented in many developing countries, by the late 1970s it was largely abandoned. Ironically, it was instrumental in encouraging transnational corporations (TNCs) to set up — in Trojan-horse fashion – production facilities within the countries concerned precisely as a way of getting round import controls — leaving such countries still essentially at the mercy of external economic players in the guise of these corporations.

Moreover, commencing with the General Agreement on Tariffs and Trade (1948) there was an increasingly concerted, international push to bring about a ‘substantial reduction of tariffs and other trade barriers and the elimination of preferences, on a reciprocal and mutually advantageous basis’. The belief was that free trade would not only mitigate the prospect of war but also promote economic growth. This tendency culminated in the emergence of neo-liberalism (rubber-stamped by the so called ‘Washington Consensus’ which replaced the post-war Bretton Woods framework) in the wake of the collapse of Keynesianism in the recession-hit 1970s.

Dependency Theory

In the early post-war years, ‘development economics’ had fallen under the spell of the ‘modernisation paradigm’. A leading protagonist, Walt Rostow, argued that development was a process driven by capital investment and that the developing countries, being short of capital, needed to open themselves up to investment from abroad. The Modernists were Keynesian interventionists and, unlike the liberals, accepted the need for developing countries to industrialise and diversify their economies. For them, ‘development’ basically meant passing through a linear sequence of economic stages, mirroring the economic history of the already developed countries (The Stages of Economic Growth: A Non-Communist Manifesto, 1960)

In the 1960s and 70s, however, the modernisation paradigm was increasingly challenged. What had appeared so seductively simple at the outset no longer seemed to fit the facts. In those early post-war years, growth among the developing countries had been comparatively vigorous — though, for the vast majority of citizens, the benefits failed to ‘trickle down’. Then, in the seventies, the oil crisis came along — and the mushrooming problem of Third World debt as many countries desperately resorted to IMF (and other) loans to plug the gap between export earnings and the rising costs of imports. With the onset of global recession, growth began to falter. In Africa alone at least 15 countries saw their economies shrink in real terms. The situation deteriorated further in the 1980s, dubbed the ‘Lost Decade’.

In this period a new development paradigm emerged — Dependency Theory. This built upon earlier structuralist thinking but also marked a new departure. As Dudley Seers notes: ‘The realization that import substitution created new, and possibly more dangerous forms of dependence converted the ECLA structuralists into dependency theorists’ Dependency Theory: A Critical Reassessment,  1981).

According to the ‘Dependistas’, drawing on Lenin’s ‘law of uneven development’, the problems faced by poor countries was not the result of their incomplete integration into the global capitalist economy as modernisation theory suggested. They were already fully integrated into this economy and those problems sprang, instead, from the form of integration to which they were subjected. They were not ‘undeveloped’ but systematically ‘underdeveloped’. This manifested itself in a net outflow of capital from them via such mechanisms as ‘unequal exchange’ — proof that it was not for any lack of capital that their development was impeded.

The ‘world trading system’ was conceptualised as a hierarchical order in which the dominant core countries were able to impose their own needs on the dominated countries. Such needs dictated that the latter should remain suppliers of low-value raw materials for processing into high value finished goods within the industrialised core countries themselves, rather than rival producers of such goods, given the latter’s complete dominance over global value chains. In short, industrial development and economic diversification was effectively blocked in the capitalist periphery.

Thus, the linear ‘stages of growth’ model of modernisation was misconceived. It overlooked that the predicament developing countries found themselves was quite unlike the pristine state of affairs already developed countries encountered when they first began to develop since, back then, there were no already-developed economies around to obstruct and distort the development process.

For developing countries, trade liberalisation (which tended to be heavily biased in favour of developed countries) was not the only problem. There was also the growing dominance of the TNCs that not only controlled the great bulk of global trade but, as stated, were becoming increasingly active as producers inside these countries. Their immense economic clout and footloose nature in a world where capital could freely relocate to wherever costs where lowest, gave them considerable leverage in their dealings with poor countries. Finally, there was the ability of lending agencies like the IMF to impose ‘structural adjustment’ programmes on these countries — like privatisation and phasing out food subsidies — as a condition for receiving the loans they increasingly depended upon.

For some ‘Dependistas’ the solution lay in ‘delinking’ from the global economy and pursing a policy of national self-reliance. But in a world in which the global division of labour was becoming ever more diversified and complex, this was not really feasible.

Moreover, though it became fashionable for a while, Dependency theory seemed increasingly out of touch with changing realities. In particular, its core claim that industrial development of the poor countries would be ‘blocked’ was decisively refuted by the emergence of the ‘newly industrialising countries’ — particularly, the Asian Tiger economies (like South Korea and Taiwan) and, above all, China which has since become a major imperialist power to rival the US, with business interests right across the globe.

Additionally, there has been a massive shift in manufacturing away from the advanced countries to the Global South which now accounts for 83 percent of the world’s manufacturing workforce. Indeed, amongst many large western-based corporations there has been a significant movement towards ‘offshoring’ production and outsourcing it to local contractors based in the Global South — meaning such corporations are no longer involved in producing commodities as such, solely in marketing and ‘branding’ them.

Guilt-ridden liberals

Around the time the Dependency paradigm was gaining adherents — the 1970s — an alternative worldview centred on the concept of a ‘New International Economic Order’ (NIEO) began to be promoted. The impetus came from the non-aligned movement of developing countries. The basic idea was to bring about a more equitable global economy.

Hardly any of the proposals embodied in this concept were taken up as neo-liberalism strengthened its hold on practical policy-making everywhere. However, in ideological terms, the concept gained traction by implanting far greater awareness of the substantial inequalities in economic circumstances and living standards between rich and poor countries.

Along with this has arisen the idea that ordinary people in the ‘rich countries’ enjoy a standard of living so much higher than ordinary people in ‘poor’ countries precisely because they live in one part of the world that profits handsomely from the exploitation of the other. They are said, in effect, to share in the fruits of such exploitation and it is this that affords them a lifestyle incomparably more affluent and comfortable than their counterparts in the exploited poor countries.

Sadly, this frankly pernicious and tendentious idea is one that seems to seep into popular discourse with all the ease of a toxin into a watercourse. It is the meat and drink of hand-wringing liberals everywhere who fret guiltily about how appalling it is that ‘we in the West’ should enjoy the comforts of life produced by the sweatshop labour of the Global South.

Consider this comment by Jonathan Glennie and Nora Hassanaien in the Guardian newspaper, that most formidable bastion of liberal thinking, on the subject of ‘Dependency Theory’:

‘As with most Marxist-inspired tirades, it is not a complete analysis of Latin America’s history — it probably exaggerates the villainy of capital and heroism of peasants. But it presents a perspective on the truth that any serious development worker or academic should have intellectual access to. This is as relevant today as ever. It is critical that voters in the rich world learn that their wealth is related to a historic exploitation of other parts of the world, especially when they are eventually asked to readjust their living habits and conditions in order to better accommodate the just requirements of poorer countries’

(1 March, 2012).

At a time when many ‘voters in the rich world’ are finding it harder and harder to make ends meet, when governments are slashing social welfare programmes with the grim determination of a state-sponsored executioner with a quota of severed heads to fulfil, when more and more people seem to have been reduced to ignominious penury of food banks, charitable handouts and even a life on the streets, it must be comforting to learn that they can always depend upon that ‘historic exploitation of other parts of the world’ to sustain and materially uplift them.

Unfortunately, being ‘asked to readjust their living habits and conditions’, by which one assumes is meant having to accept a downward adjustment in their real income is no guarantee whatsoever that the ‘just requirements of poorer countries’ will be suitably accommodated.

On the contrary, the only beneficiaries of this sacrifice will likely be those who substantially own the means of production and profit from the employment of others who constitute the overwhelming majority of those ‘voters in the rich world’ to whom Glennie and Hassanaien appeal. There is no getting round this most fundamental antagonism in our existing capitalist society which mediates and conditions everything else that we find so obnoxious and objectionable about it.

In fact, grotesque inequalities are to be found in both the rich world and the poor world alike. Spatial-cum-national inequalities in this respect pale by comparison with class inequalities, something our liberal handwringers seem constantly prone to overlooking. In this, they are joined by Maoist-style ‘Third Worldists’ who cynically exploit the idiom of Marxist rhetoric to justify their abandonment of a class-based analysis of capitalism in favour of a nationalistic-based ‘anti-imperialism’.

In the final two parts of this series we will consider the claims of these Third Worldists and subject them to empirical and theoretical scrutiny.

Robin Cox