About Socialism (1989)

From the January 1989 issue of the Socialist Standard

1. What is the Socialist Party of Great Britain?

It is a political party, separate from all others, Left, Right or Centre. It stands for the sole aim of establishing a world social system based upon human need instead of private or state profit. The Object and Declaration of Principles printed in this introductory leaflet were adopted by the Socialist Party in 1904 and have been maintained without compromise since then. In other countries there are companion parties sharing the same object and principles, and they too remain independent from all other political parties.

2. What is capitalism?

Capitalism is the social system which now exists in all countries of the world. Under this system, the means of production and distribution (land, factories, offices, transport, media, etc.) are monopolised by a minority, the capitalist class. All wealth is produced by us, the majority working class, who sell our mental and physical energies to the capitalists in return for a price called a wage or salary. The object of wealth production is to create goods and services which can be sold on the market at a profit. Not only do the capitalists live off the profits they obtain from exploiting the working class, but, as a class, they go on accumulating wealth extracted from each generation of workers.

3. Can capitalism be reformed in our interests?

No: as long as capitalism exists, profits will come before needs. Some reforms are welcomed by some workers, but no reform can abolish the fundamental contradiction between profit and need which is built into the present system. No matter whether promises to make capitalism run in the interests of the workers are made sincerely or by opportunist politicians they are bound to fail, for such a promise is like offering to run the slaughter house in the interests of the cattle.

4. Is nationalisation an alternative to capitalism?

No: nationalised industries simply mean that workers are exploited by the state, acting on behalf of the capitalists of one country, rather than by an individual capitalist or company. The workers in nationalised Austin Rover are no less the servants of profit than workers in privately-owned Ford. The mines no more belong to "the public" or the miners now than they did before 1947 when they were nationalized. Nationalization is state capitalism.

5. Are there any “socialist countries”?

No: the so-called socialist countries are systems of state capitalism. In Russia and its empire, in China, Cuba, Albania, Yugoslavia and the other countries which call themselves socialist, social power is monopolized by privileged Party bureaucrats. The features of capitalism, as outlined above, are all present. An examination of international commerce shows that the bogus socialist states are part of the world capitalist market and cannot detach themselves from the requirements of profit.

6. What Is the meaning of socialism?

Socialism does not yet exist. When it is established it must be on a worldwide basis, as an alternative to the outdated system of world capitalism. In a socialist society there will be common ownership and democratic control of the earth by its inhabitants. No minority class will be in a position to dictate to the majority that production must be geared to profit. There will be no owners: everything will belong to everyone. Production will be solely for use, not for sale. The only questions society will need to ask about wealth production will be: what do people require, and can the needs be met? These questions will be answered on the basis of the resources available to meet such needs. Then, unlike now, modern technology and communications will be able to be used to their fullest extent. The basic socialist principle will be that people give according to their abilities and take according to their self-defined needs. Work will be on the basis of voluntary co-operation: the coercion of wage and salary work will be abolished. There will be no buying or selling and money will not be necessary, in a society of common ownership and free access. For the first time ever the people of the world will have common possession of the planet earth.

7. How will socialism solve the problems of society?

Capitalism, with its constant drive to serve profit before need, throws up an endless stream of problems. Most workers in Britain feel insecure about their future; almost one in four families with children living below the official government poverty line; many old people live in dangerously cold conditions each winter and thousands die; millions of our fellow men and women are dying of starvation — tens of thousands of them each day. A society based on production for use will end those problems because the priority of socialist society will be the fullest possible satisfaction of needs. At the moment food is destroyed and farmers are subsidised not to produce more: yet many millions are malnourished. At the moment hospital queues are growing longer and people are dying of curable illnesses; yet it is not "economically viable" to provide decent health treatment for all. In a socialist society nothing short of the best will be good enough for any human being.

8. What about human nature?

Human behaviour is not fixed, but determined by the kind of society people are conditioned to live in. The capitalist jungle produces vicious, competitive ways of thinking and acting. But we humans are able to adapt our behaviour and there is no reason why our rational desire for comfort and human welfare should not allow us to co-operate. Even under capitalism people often obtain pleasure from doing a good turn for others; few people enjoy participating in the "civilised" warfare of the daily rat-race. Think how much better it would be if society was based on co-operation.

9. Are socialists democrats?

Yes: the Socialist Party has no leaders. It is a democratic organisation controlled by its members. It understands that Socialism can only be established by a conscious majority of workers — that workers must liberate themselves and will not be liberated by leaders or parties. Socialism will not be brought about by a dedicated minority "smashing the state", as some left-wingers would have it. Nor do the activities of paid, professional politicians have anything to do with Socialism — the experience of seven Labour governments has shown this. Once a majority of the working class understand and want Socialism, they will take the necessary step to organise consciously for the democratic conquest of political power. There will be no Socialism without a socialist majority.

10. What is the next step?

Many workers know that there is something wrong and want to change society. Some join reform groups in the hope that capitalism can be patched up, but such efforts are futile because you cannot run a system of class exploitation in the interests of the exploited majority. People who fear a nuclear war may join CND. but as long as nation states exist, economic rivalry means that the world will never be safe from the threat of war. There are countless dedicated campaigns and good causes which many sincere people are caught up in, but there is only one solution to the problems of capitalism and that is to get rid of it, and establish Socialism. Before we can do that we need socialists; winning workers to that cause requires knowledge, principles and an enthusiasm for change. These qualities can be developed by anyone — and are essential for anyone who is serious about changing society. Capitalism in the 1980s is still a system of waste, deprivation and frightening insecurity. You owe it to yourself to find out about the one movement which stands for the alternative.

If you have read this set of principles and agree with some or all of them, contact the Socialist Party with your questions and ideas about what you can do to help speed the progress towards Socialism.

Running Commentary: Base metal (1989)

The Running Commentary column from the January 1989 issue of the Socialist Standard

Base metal

Margaret Thatcher, not to mention her advisers. have worked hard at promoting her image as the Iron Lady of Europe. This means depicting her, not just as determined and strong but also as fair and consistent. For a woman of her mettle, there is a Right side of a question and a Wrong side and the twain shall never be allowed to meet.

[The] obstruction of the Queens proposed visit to Russia? Leaving aside the possibility that her objection was inspired by fear of being upstaged, even by the head of the royal family — so base a motive must be beneath the dignity of an Iron Lady — we are left with the argument that no British monarch should be allowed to visit a totalitarian country like Russia. It was also rumoured that Thatcher thought it improper for a British sovereign to so recognise a regime whose forerunners had done in the Romanovs.

There might be a shred of justification for this stance were it consistent. But no government — including this one — has ever refused contact with a foreign power because of an abhorrent record on human treatment. Anyone who has doubts about this need only look at the recent example of Turkey. This member state of the supposedly democracy-defending alliance of NATO is governed by a brutal dictatorship which is notorious for imprisoning and torturing people whose only offence is to voice opposition to it. Yet Thatcher's voice was not raised against the recent visit here of the Turkish President Evren and she is an avowed admirer of the Turkish Prime Minister Turgut Ozai: the term she has used to describe herself is an Ozalite.

The issue of whether the queen goes to Moscow — which in any case has now been wiped off the agenda by the Armenian earthquake — is not concerned with human interests. Capitalism has a history of international conflict but no states have ever gone to war because one was a democracy and the other a dictatorship. All states deal with each other over economic, political and strategic advantage, which leads to all manner of disputes and alliances. the common feature of which is a ruthless cynicism. Human welfare does not enter into it, unless it can be used to make propaganda points against the other side.

So let not the Iron Lady deceive us. with her audacious claim to be concerned with fundamental human rights and freedoms. Nor with her claim to be any different from, or better than, the other politicians for their common role is to dabble in the brutal mess of capitalism.

Beyond Ken

Strange events in Brent East, where discontent rumbles about local MP Ken Livingstone, who was better known in his hey day as Red Ken of County Hall. During that time, when he was leader of the GLC. Livingstone showed himself to be a tough and clever political operator and to have some flair as a self-publicist. At any rate he rode out some pretty scurrilous attentions from the gutter press and ended his time at County Hall as something of a local hero, the champion of local democracy against the depredations of the Tory government.

But he has not found life so agreeable in Parliament. It has been reported that he is an outcast there; he himself has said that anyone who enjoys being in Parliament probably needs psychiatric care — which could not have endeared himself to those who are addicted to their status as Hon. Members.

None of this need have gone against Livingstone in his constituency but recently he has put some scathing views on record about the local council, which is about the most famous in the country for the chaos created by its wild-left administration. Brent councillors have worked on the principle that the capitalist system they stand for, and which they persuaded the voters to vote for, does not exist when it suits their purpose. The result has been historic in its embarrassment and confusion. A veteran of local government, Livingstone has not approved; he has compared the Brent Labour Party to Kampuchea under Pol Pot. along with a few other unkind remarks.

So now there is talk in the constituency about de-selecting Red Ken. There is a delicious irony in this, for the left wing in the Labour Party pushed through the constitutional reform of de-selection on the assumption that it would only ever be used to unseat right wingers. That was what happened in Brent East, where Livingstone was appointed candidate after a long and bitter struggle to turf out the old-established sitting MP, Reg Freeson.

De-selection was hailed as a great step forward to a more democratic, more ' socialist'' Labour Party. In reality it was often used as a steam roller to ensure the unquestioning acceptance of one point of view. Livingstone's offence has been to go against this, to act as if he had some independent thoughts. If he pays for this by the loss of his seat, perhaps he will learn something about the futility of single-issue, fragmentary reformism as well as about the cynicism of his party.

Percentage game

"£14 million for Sainsbury chief" said the Observer headline on 6 November. The item told us that 23 UK company directors received in excess of £1 million each last year in salary and dividends. Against David Sainsbury's £14.846,816. Tiny Rowlands only managed £8,095,754 and the last five only managed £1 million, excluding dividends. 1,451 directors had to make do with salaries of just over £100,000.

Three years ago no-one was paid over £1 million and only 338 received in excess of £100,000. How well invested therefore was the cool £4.5 million contributed by major companies to Tory election funds (Observer, 4 December). After all, of those directors in the above list, the £102,000 contributed by Hanson is less than one tenth of Lord Hanson's salary last year of £1,263,000!

Much was made at the time of Thatcher's decision not to take the last increase MPs awarded themselves. However it is less well-known that, while the cost of running her private office has risen from £4.4 million in 1986 to £5.4 million (an increase of ten per cent per annum), the part-time cook who has worked there for seven years is paid the princely sum of £69 a week — that is, £3,588 a year or just about enough to cover the cost of one of the new sets of drapes Thatcher has just had made for her windows. Expressed in the percentages of which Mr. Lawson is so fond, the cook is earning 0.15 per cent of what her employer spends spends on running her office.

Under the headline "Pay; alarm bells ring — wage explosion fear as inflation rises" (Daily Express. 19 November), we are told of Government fears following another rise in the rate of inflation. Last year average wages rose 9.25 per cent, as firms gave their employees a small slice of the increased profits obtained through their efforts. We should all be used to the Chancellor's attempts to "cook" figures (the latest suggestion is to remove mortgage repayments from the Cost of Living Index) but now the Treasury has gone one further. “If the wage rises awarded to workers were taken out of the equation, instead of a rise to 6.25 per cent in inflation in October, the figure would have fallen from 5.2 per cent in September to 5.1 per cent", we are told in that same article. Obviously. therefore, if we take all figures out of the equation a healthy zero would be achieved!

In more serious vein, socialists do not expect anything other than "double speak" from the owners and controllers of wealth production, who threaten us with dire consequences if we ask for even a small part of increased profits, while justifying the ever larger remuneration they allocate themselves as "essential incentives".

Merthyr Vale

One of the latest collieries in South Wales under the threat of British Coal's axe is Merthyr Vale. If it is closed over 500 miners will lose their jobs, adding to those who have been made redundant at the 19 pits which have been shut down since the 1984 strike to save them. Only nine pits now remain of what was once a vital and dominant industry.

If Merthyr Vale closes it will be especially poignant. It was once known as Aberfan-Merthyr: the first part of the name was lopped off after the disaster in the autumn of 1966, when a spoil tip on a mountainside above Aberfan was loosened by torrential rain and came sliding down onto the village, to kill over a hundred people, many of them children in the village school.

It was clear then — as the subsequent official enquiry confirmed — that this was no accident in the sense of it being unpredictable or out of anyone's control. The spoil from the colliery had been dumped up above the village because — as it was the case in many other mines in the area — that was the cheapest way of getting rid of it. (In County Durham it was emptied into the sea, turning the water and the beach black.) The overriding concern for cheap production fostered a complacency which contributed towards the events that morning, for the great mass of dust and slag had not been properly checked for stability. When the rains came there was some alarm about the heap's condition but still nothing was done and as a result the people of Aberfan experienced indescribably terrible deaths.

At the time there was a natural outcry against those whose complacency was seen to have been a factor in the disaster. Among those outraged voices, it was not unknown for miners to put a different point of view. A colliery, they argued, meant jobs; without it the village would decline into the direst poverty. If the price of the jobs — the price of keeping the pit open — was that lives had to be imperilled, which in the case of Aberfan meant building an unstable hill of slag on top of a mountain, then so be it. After all, the coal industry was no stranger to massive tragedies. Better a paid wage slave than one out of work; better the gentler poverty of employment than the destitution of the dole queue.

Well the employers — the Coal Board — have shown what they think of that stoically self-sacrificing attitude. Merthyr Vale will close if it is adjudged to be unprofitable to keep it open, just as it was once thought to be unprofitable to dispose of the pit’s spoil in some way other than dumping it high above the people of the village.

The profit motive which spawns and drives production in this society exploits millions of people, which means that while it impoverishes them it makes them grateful for their poverty. In many cases it murders them, while persuading them that there is no other way to live, or to relate to each other and in the end to die.

Balance sheets exist to show whether a profit or a loss is being made and how big it is. They are not there to settle debts of suffering. The Coal Board, like any other employer who knows their business of exploiting people for profit, works on the same calculating basis as those tragically compliant miners who would accept death as an unavoidable part of their wage slavery.

The fate of Merthyr Vale illustrates what little account are human lives and welfare in this profit-orientated system. Is it too much to hope, that the workers there will remember Aberfan for what it has to teach them about capitalism, to help them better understand its tragedies and the full humiliation of the part they condemn themselves to play in them?

"They said it in 1988" (1989)

From the January 1989 issue of the Socialist Standard

JANUARY

• The pawnbroker of today provides a social service. People come to us when they get into trouble with their credit cards. (Phil Murphy, managing director of a Manchester pawnbrokers.)
• I cannot sleep at nights worrying about the cutbacks and the effect they could have on our son. (Mother of a baby waiting for a heart operation.)
• You may have the staff and the beds but you still need money to treat patients. (Mike Harley, Health Service Management Centre.)
• I'm in this job to care for people, not juggle figures and come up with an immaculate balance sheet ... When you get a note in your Christmas pay packet congratulating staff for being part of the only health authority in the country to stay within budget, you know things are seriously wrong. (Sister Audrey Harris, Ealing Hospital.)
• Anybody who enjoys being in the House of Commons probably needs psychiatric care. (Ken Livingstone, MP for Brent East.)

FEBRUARY

• The army is the army so there will be no problem with trade unions. (General Yazov, Russian army, on possible military redundancies after the INF Treaty.)
• Let's have a proper constructive policy, which as far as were concerned means taking land out of production. (Tony Pexton, National Farmers' Union cereal spokesman.)
• I hate all of them. I think they are the phoniest two-bit bastards. (Bill Carrick, Democrat Richard Gephardt’s election aide, on the other Democratic primary candidates )
• Someone tells them they should break Arabs' bones and then some orthopaedist says they musn’t. What's going on here, for God's sake? (Father of an Israeli paratrooper who was shown on TV beating two bound Palestinians.)

MARCH

• There is so much more to life than business schemes and striving for profit. (Tim Mulligan, Hampshire coroner, at a businessman's inquest.)
• Bush has a charmed life in politics; he's gone a long way without doing very much. (Republican Senator Robert Dole.)
• We see little that is hopeful. A continual rise in poverty, homelessness and reported child abuse has become a feature of Britain in the 1980s. We believe that there is worse to come. (Michael Newman, Chief Executive, National Children's Homes.)
• Money is for those who can make it. And those who can't make it must not be allowed to get in the way of its being made. (Bishop of Durham.)

APRIL

• Although we know atomic weapons will never disappear, it is clear that their development is being intensified against all political claims of disarmament. (Liz Baker, CND veteran on the 1988 Aldermaston march.)
• When the market's very active I have a migraine the whole time — I get through a bottle of aspirin a week. (Mardi Haynes, Eurobond dealer.)
• I know that she has done things like washing up and Hoovering carpets, and she did them very well, but I know that she's very happy being a princess. (Earl Spencer, on his daughter Princess of Wales.)
• I was brought up poor. I never thought it would go on for ever, on to my children and now maybe their children's children. (Shop assistant Claire Hurst.)
• Don't shop when hungry — you may be tempted to buy more than you need. (DHSS advice to claimants.)
• It was a cold-blooded financial decision. (Lionel Read, London Regional Transport's counsel, explaining the lack of fire precautions to the King's Cross fire enquiry.)

MAY

• I vote Conservative no matter what. (Angela Corbett, student nurse.)
• I'd vote National Front if they were here. I like Mrs. Thatcher. She's strong. (Gary Silk, chef.)
• I recommend investment in the quality of life because that is what is really going to matter in the future. (Prince Charles, to the Anglo-American business conference.)
• I do not think I have ever been ruthless. (Margaret Thatcher.)
• My husband takes second place to the Sun but he says he still loves me. (Letter in the Sun from Doreen Steward.)
• Companies are increasingly seeing that controlling crime is good business. More tranquil communities create a better environment in which business can flourish. (Steven Norris, chairman Crime Concern.)

JUNE

• We at LRT can't possibly be considered to be trying to wriggle out of the blame for the tragedy. (Keith Bright, then chairman of LRT, to the King's Cross fire enquiry.)
• You're very hard put to find, even in Albania, an economy that does not rely on the market. (Bryan Gould, Labour industry spokesman.)
• The Soviet people must remember Stalinism as the Jewish people remember the Holocaust (Yuri Skubko, member of a group setting up a memorial to Stalin’s Russian victims.)
• You live for Friday and Saturday night. If you don't get a good time, you get mad; you’ve got to take it out on somebody. (Football hooligan.)

JULY

• Medicine is a fiercely competitive place now. (Malcolm Grosvenor, Trafford Health Authority.)
• Derek Hatton in a show called Scruples. It's enough to make you laugh. (Actor Brian McDermott on Hatton getting an Equity card for a TV show.)
• I have great admiration for Mr. Gorbachev. (Margaret Thatcher.)
• Money does make life a damn sight more comfortable. (Millionaire George Wiliams.)
• On the doorstep I mention David Owen's name three times in the first minute and a half. (John Martin, SDP candidate, Kensington by-election.)
• We live in a society that reveres profit. The effects on health of economic policies are ignored. (Judy Sagrove, Guardian Health Editor.)
• I'm right wing and an absolute royalist and I don't like the way things are going. (Buster Edwards, Great Train Robber.)
• Frankly, I mean, my sort of humour I can use as a kind of phoney elder statesman. (Denis Healey.)
• I am not motivated by amounts of money. (Multi-millionaire Peter de Savary.)
• For reasons which I do not understand, the memory of Mrs. Thatcher seems more indelibly printed on the patients with dementia than most other facts over the last 15 years. (Psychiatrist — Social Work Today).)
• It's easier to be law-abiding when you are wealthy than when you are struggling for your existence. (Peter Imbert, Chief of the Metropolitan police.)

AUGUST

• I really sobbed my heart out when the SDP was broken up. (David Owen.)
• Politics is no longer on my agenda. (Harvey Proctor, ex-Tory MP for Billericay.)
• She really is a woman just like my mum. (Cliff Richard on Margaret Thatcher.)
• Any minister in her Cabinet must respect her judgement... She wins elections. (Kenneth Baker on Margaret Thatcher.)
• My father is a tolerant person. (Rhonda, daughter of Ian Paisley.)

SEPTEMBER

• The Sultan of Brunei is an attractive as well as an absolute monarch. He dislikes being described as the world's richest man. (Susan Crosland.)
• They run if the money is right, rather than to meet one another. (Anne Packer, 1964 Olympic gold medallist, on the participants in the Seoul Olympics.)
• People need to be educated, not trained to work. (Kinglsey Amis.)
• I liked the man. There was nothing he didn't know about birds. (Lord Home on Neville Chamberlain.)
• The things I believe in are fundamental human rights. (Margaret Thatcher.)
• Being a black quarter-back nowadays is almost like being president of Nicaragua. (Don McPherson, quarterback, Philadelphia Eagles.)
• Being the leader of the Labour Party is the worst job in Britain. (Labour MP John Prescott.)
• We first voted for equal pay in 1885 and we have not delivered the goods yet. (Ken Gill, at the TUC.)
• Whatever happens in the world, Hanson wins. (Sean O'Connor, account director. Hanson Trust's advertising agency.)

OCTOBER

• The vote is a clear sign that Labour wants to stick to its traditional unilateralist defence policy. (Ron Todd on Labour's conference vote for unilateralism.)
• These votes were not conclusive. The policy review continues. (Neil Kinnock, on the same vote.)
• For the first time in my life, and the first time I think in world history, I can now see a chance of ending war forever. (Denis Healey.)
• I don't mind looking very glamourous, but I don’t want to be trivialised. (Edwina Currie.)
• I often think television has done so much good for people that I hope they have television in heaven. (Roger Ailes, media consultant to George Bush.)
• Mrs. Reagan is never greedy. She only takes what she can use. (David Hayes, American dress designer.)
• The leadership of the Party writes about individual freedom before collective fellowship and talks about issuing shares. It's difficult. (Martin Corrick, chairman Eastleigh Labour party.)
• Overcrowding is well past safety point now. In the rush hour you can't even get the driver's cab door open to sort out a problem. (Brian Hall, London Tube driver.)
• What we are saying is that Avebury Manor is as much yours as it is mine, although we will charge you to come in. (Kenneth King, who bought the Jacobean Avebury Manor for £1 million.)

NOVEMBER

• We are living in a capitalist society where you are supposed to make money and that is what I am doing. (Sunil Kumar, owner of a bed-and breakfast hostel for the homeless.)
• There is no evidence that rich old people die from hypothermia. (Dr. Eric Midwinter, director of the Centre for Policy on Ageing.)
• I'm merely saying that a lot of people find it difficult to believe your most sincere assurances. (Robin Day, to Nigel Lawson.)
• There is no reason you should feel guilty because you have parents who have money. (Marchioness of Worcester.)
• It is clear on the evidence of Sir Keith that his board did have proper regard to efficiency and economy: it is equally clear that they did not impose the same criteria when it came to safety of operation. (Fennell Report on the King's Cross fire.)
• I'm not a greedy person. (Multi-millionaire Peter de Savary.)

DECEMBER

• We're turning people away if they have slept rough before — they can sleep rough again. (Department of Social Security.)
• Sex discrimination is not only unfair but harms the economy. (Norman Fowler. Employment Secretary.)
• He's the only wally I ever went out with. I feel so ashamed of it now, he's such a yob. (Model Fiona Wright, on Derek Hatton.)
• I am not sure that doing something for money makes it any more moral. (The Duke of Edinburgh.)

Still chasing the tanner (1989)

From the January 1989 issue of the Socialist Standard

In 1989 workers' backs are to the wall. Who will be the next for the chop in the ongoing economic terrorism known as rationalising the economy? Union bureacrats in posh offices are thinking up new cliches to put in their tired old speeches to those who pay their salaries To be sure without unions workers would be exploited even more — they are our best defence against the class who buy our labour power and milk us for profit. But all the militant rhetoric in the world will not disguise the fact that unions can only do what the capitalist system will let us get away with. And in 1989 the bosses will be getting away with murder.

What a difference a century makes. Back in 1889 the workers were on the move. For the first time unskilled unions were being formed, organised by working men and women with a growing political consciousness of their class position. The New Unionism, as it was called, was a major development in the thinking and activity of British workers

The gas workers showed the way to do it. Back in 1872 the gas stokers — unskilled workers who had not been welcome in the old skilled, craft unions — formed the Amalgamated Gasmen's Association. When union members were sacked and scabs brought in to do their work at lower rates in plants at Beckton, Stepney, Bow, Hackney, Bermondsey and Fulham, 2,000 workers came out on strike. More scabs were brought down from Yorkshire and Lancashire to fill their jobs. Five of the Beckton stokers, alleged by the bosses to be the strike organisers. were arrested and sent for trial at the Old Bailey for breach of the Masters and Servants Act and the Criminal Law Amendment Act. They were sentenced to a year s hard labour. In 1884 and 1885 two further attempts to unionise were crushed by the parasites who owned the gas plants but never produced any gas, save for that emitted in defence of the great "freedoms'' of the profit system.

On 31 March 1889 the gas workers held a mass meeting in Canning Town to organise a union. Will Thorne, a member of the Social Democratic Federation and an employee of the Gas, Light and Coke Company at Beckton, addressed the meeting At the end eight hundred men voted to form a union. Two weeks later the union's membership stood at 3,000: its motto was “Love, Union and Fidelity". These workers did not know much about the class war, except that they were poor and the bosses were rich and the bosses were rich because the workers were poor. Thorne himself, an unskilled labourer with a wife and five kids, was taught to read and write by Karl Marx's daughter, Eleanor, who threw her full support behind the striking gas workers.

Under capitalism you don't always win even if you fight hard. The system is weighted in favour of the capitalists, and it takes a lot of hard struggle for workers to win battles in the class war. But the gas workers understood what the "new realists" of the modern trade union movement have yet to learn: if you don't fight hard you won't win. The gas workers fought for eight-hour shifts and double rates on Sundays. Within a month the bosses were on their knees. The strike was won. Unprecedentedly, these unskilled workers had shown the capitalists the power of labour united.

That was in the spring a hundred years ago. By the summer an even greater strike of unskilled workers took place, the only strike of the last century which, in Ben Tillett's words, "has the dignity of capital letters": The Great Dock Strike. On 14 August unskilled labourers in ten London docks formed the Dock, Wharf, Riverside and Labourers' Union of Great Britain, Ireland and the Netherlands. They started with 800 members and went on to recruit 150,000. Their demand was 6d. an hour (less than 3p. in modern money). It became known as the fight for the dockers' tanner. 30,000 workers marched through the streets. Not for them the "new realism" of sitting in smoke-filled rooms doing deals with the bosses. They went out and took their message to their fellow workers, not just in speeches, but in song. To the tune of "Tramp, Tramp, Tramp, the Boys are Marching", the dockers sang

Strike boys, strike for better wages!

Strike boys, strike for better pay!

Go on fighting at the docks.

Stick it out like fighting cocks

Go on fighting till the bosses they give way!

Not a chorus to be heard that often around the table of the General Council of the 1980s' TUC. In Hyde Park on 1 September, 100,000 workers gathered to listen to speeches, many from socialists, in support of the striking dockers. There was no Norman Willis there to counsel caution; no Kinnock to condemn the dockers for getting the working class a bad name.

A significant feature of the Great Dock Strike was the solidarity shown within the working class. Workers seemed to feel, politically limited as their knowledge was, that an injury to one was an injury to all. So the money flooded in. Throughout London street collectors asked workers to contribute their pennies. The loafers in the gentlemen's clubs gave not a farthing, but the wage slaves collected a magnificent £11,732. The other trade unions sent donations amounting to £4,234. But solidarity was expressed not only by British workers. 1889, after all was the year of the formation of the Second International. Useless as that body subsequently proved to be, back in 1889 it rallied support from workers in France, Belgium, Germany and the USA, who managed to send over £100 to the strike fund. But most inspiring of all was the effort of the Australian trade unions who, quite unexpectedly, managed to send over £30,000 to the dockers. The capitalists may have been divided into competing national gangs, but the workers showed that they were not. No struggle under capitalism can be won by a movement which is broke, but the dockers did not stand alone and the strike ended with the employers conceding enough for the union to return to work as victors in the battle. (In fact, the dockers' tanner was not won, although 5d. an hour was granted. Other demands were met and, perhaps above all, the capitalists knew just how mighty a force the workers they exploited could be).

There is nothing like victory to give workers confidence. Without doubt, the Great Dock Strike showed what could be achieved by united class action. As Engels observed at the time.

That these poor famished broken down creatures who bodily fight amongst each other for admission to work, should organise for resistance, turn out 40-50,000 strong, draw after them into the strike all and every trade of the East End in any way concerned with shipping, hold out above a week, and terrify the wealthy and powerful dock companies that is a revival I am proud to have lived to see.

Socialists like Engels were not alone in seeing the dockers' struggle as an awakening of our class. On 24 September 1889 these lines from a working-class poet were published in the East End News:

O, this is the turn of the night and the tide.

And the sea's coming in, and the sunrise spreads wide.

Who said that these men were too weak to unite?

Who said that wrong should always triumph o'er right?

Who said that the devil should always hold sway?

What matters who said it. They're answered today! 

Who said that we slept, and would never awake?

To see how those suffer who live for our sake 

Such lives that we mean soon that no man shall live?

Are we waking, oh brothers, we cheer you and give 

Our gold, our good word. Now that this fight is won 

The whole world is with you. Take heart and press on.

For the past century the workers have been pressing on. And the capitalists have been pushing back. With their police scab-herders and their anti-union laws and their puppet Judges and their parties of Left and Right who seek to run the wages system, our class enemies have pushed and pushed. The tragedy is that in 1989 workers are still chasing the tanner — still fighting, when we can muster the confidence to fight, for the crumbs from the cake we ourselves bake. We should learn from the events of the last hundred years that it is not enough perpetually to be chasing the tanner. It is the wages system itself which is our enemy; only its abolition will mark the true victory of the working class.

Steve Coleman

Whose hand turns the key (1989)

From the January 1989 issue of the Socialist Standard

Unforeseen and unintended, the Thatcher government has made a significant contribution to the great Lexicon of left-wing swear words. Already including such terms as armchair socialist, reactionary and fascist — which have long been handy substitutes for reasoned argument — the Lexicon has now been enriched with the word “privatisation”. In this sense privatisation means more than just the substitution of private for state control of an industry. Contemptuously, it means the snatching-back of commonly owned concerns which have been operating to everyone's benefit and presenting them single-mindedly for personal profit instead of to satisfy communal needs. (The late Earl Stockton, in one of his last speeches, won the headlines by referring to this as "selling off the family silver" but he was always too much of a gentleman to use swear words of whatever sort.)

But, as the Tories never tire of telling us. we now live under a radical, fearlessly reforming government. Nothing is safe from their appetite to privatise. After British Telecom, British Gas and the like they are now asking why private investment should not also take over concerns where state control is set hard in tradition, apparently everlasting. ‘Now they're going to privatise the bloody prisons" was how one left-wing supporter of the Labour Party put it, as the morose and bitter climax of his diatribe against the Thatcher government and all its deeds.

He was referring to a recent Home Office Green Paper — Private sector involvement in the Remand System — which has floated the idea of privately built and operated remand prisons and he was not alone in his shocked opposition. Frances Crook, Director of the Howard League, has protested:

Prisons are a public trust. It is extraordinary that this zany notion is being taken seriously.

David Wilson, a prison governor, told the annual conference of the Prison Goverrnors' Association that

It is immoral that the market place should be extended to the area of public responsibility.

And the National Association of Probation Officers agreed:

It is morally wrong for firms and individuals to make money out of imprisonment.

There was no such moral outrage when other industries were privatised, so it is fair to ask why the reaction should be so different when it comes to the prison system. It is because they are part of the state coercive machinery, because the deprivation of a human being's liberty is so sensitive a matter that it cannot be left to a private industry? If so, it must be asked how this matter has been dealt with by the state prisons and with what effect on the conditions of the people whose liberty had been taken from them.

But first it has to be conceded that the history of privately run prisons is not a happy one. When the death penalty applied to something over 200 offences, there was no need for prisons apart from small, temporary holding places. These were to be found in all manner of buildings, from cellars to gatehouses. Nominally they were in the charge of the local magistrates but they passed their responsibility to private contractors. The basis of the contractors' profit was the fees they were allowed to charge the prisoners. There was an admission fee and another on discharge; a fee for putting someone in irons and then for taking the irons off again. Food was not doled out but sold to the prisoners and the gaolers added to their income by running brothels and drinking dens inside the prisons. Like any Thatcherite minister, they kept a firm hand on the costs of running their enterprise, even if cutting back on their overheads meant diseases such as typhus ran riot. With the ending of transportation the first state prisons began to be built and during the nineteenth century there was a glut of prison building, much of the results of which are still in use today. Some of the worst aspects of the design of those prisons was a reaction to what had gone on so scandalously in the old local, private lock-ups. The chaos of freely mixing inmates with their boozing and whoring and rackets, was replaced with solitary confinement and the exhausting, unproductive degradations of the crank and the treadmill. This was called progress, a reform which would work wonders for the prisoners' morals.

The showpiece of this theory was at Pentonville, where prisoners were not only forbidden to talk but even to face other people. Apart from their punishment, the only activity allowed them was to meditate on their crimes and to try to purge their guilt by embracing Christianity. Not surprisingly, the result was not to reform the prisoners but to unhinge them mentally. The present regime at Pentonville is not at all like that now but it has some notoriety among prisoners as a crowded, depressing, verminous place and is by no means an example of how to run a prison. In fact it would be very difficult for anyone — apart perhaps from the Home Secretary and his minions — to defend the British prison system while there is no lack of experienced and knowledgeable critics. Last August the chairman of the Prison Reform Trust said

The prison system in this country has become a national disgrace. It totters from crisis to crisis, endemically overcrowded and subject to the increasing likelihood of violent disorder or industrial unrest.

The 1986 Report of the Chief Inspector of Prisons noted that “The overall quality of life for many prisoners deteriorated in 1986" anct went on to elaborate:

The physical conditions in which many prisoners had to live continued, to border on the intolerable. For remand prisoners m particular, whose number increased sharply during the year, conditions were particularly poor.

A great many inmates of local prisons spend 23 hours a day locked in their cells without running water and with a chamber pot as their only readily available means of sanitation. There are 48 prisons which have no access to sanitation at night. It sounds like — and is — an urgent problem but it is not reflected in the Home Office plans, which expect only a partial remedy by the year 1999. when there should still be 26 prisons without the basic amenity of night sanitation. Inmates in many of the local prisons are restricted to one bath or shower and change of clothing a week. It is not surprising that in one of them the Chief Inspector found that sanitation was "by far the worst feature of the prison". In another, the kitchen was in such a “deplorable state" that "acceptable standards of safety and hygiene could no longer be maintained". And in another prison the reception unit was such that it was impossible to operate it as the secure, humane decent and confidential place that it should be

Of course prisoners don't have to accept these conditions. There is, quite plainly laid down in the Prison Rules, a method by which they can complain and get their grievances put to rights. They can see the prison governor about it, or the Board of Visitors; they can get their MP to put the complaint to the Home Secretary; they can send a petition to the Home Office direct. But one of the first thing a prisoner learns, as the gate clangs shut behind them, is that these rights often exist in theory only. A review of the procedure for dealing with prisoners' complaints by a former Chief Inspector of Prisons, published in March 1988. pointed out that although the procedure for ventilating and dealing with grievances should be fair, effective and widely known, in reality "... the procedures currently in use in England and Wales do not satisfy these criteria, and that changes in the system are required ". The principles of so-called natural justice, which the Divisional Court stated in 1979 should be the basis of prison disciplinary hearings, are usually ignored — which is not surprising when the power to investigate prisoners' complaints is restricted to the governor and the Home Secretary, who are the prison system incarnate.

In almost all cases, prisons are neurotically sealed off against the outside world, with their own rules of contact and survival and anyone expecting to be protected by the elusive concepts of justice will be in for a rude enlightenment. The same can be said for anyone who expects to receive proper medical treatment, for in many cases this will consist of swigging aspirin water prescribed by a prison officer who has undergone the sketchiest of medical instruction or the most cursory and careless "examination" by a doctor. The repressions and frustrations of prison life, which itself discourages any therapeutic release of feelings, are responsible for a lot of suicides among prisoners (not to mention some distortion in the personal lives of the prison officers). About the most notorious place for suicides is Risley Remand Centre, in Lancashire, which has won for itself the unenviable name of Grisly Risley. According to the Home Office, between 1980 and 1986 an average of 19 prisoners a year killed themselves — or, to be more accurate, were adjudged by an inquest to have done so. During that period the prison population averaged just over 44.000, which gives a suicide rate of over 43 for each 100,000 compared to a figure of 7.63 for the population at large.

For the prisoner trying to survive among all this the last, fail-safe, mechanism is the Home Secretary, who is supposed to be able to step in and ensure that prisons are run in a humane and efficient way and that what the law describes as prisoners' rights are respected. But this again is something which has little existence in reality for if an MP puts a complaint to the Home Office the reply which eventually emerges usually consists of little more than a recital of the all too well known facts of the person's offences. sentence and so on. Whatever procedural abuses there have been, however sluggishly a complaint has been processed. no matter how blatant the official obstruction. the Home Office can be relied on to act as the most obdurate of stonewalls, in place principally to protect the prison system and certainly not to criticise it nor to make it more open and accessible.

This is a sorry catalogue of human misery and it is doubtful if any of the opponents of privatisation would find anything in it to approve. Indeed many of them are deeply committed to exposing and denouncing the present set-up. Could it be, then, that their hostile response to the proposals to introduce an element of private investment into the prisons is yet another knee-jerk reaction? The government's proposals at present seem to be limited to the remand section, with no plans to privatise eerie, high-security places like Albany. As the Green Paper pointed out. there has been something of a trial run of private prisons in this country for some 20 years, under Labour governments as well as under the Tories, at the Harmondsworth Detention Centre, where people arrested under the immigration laws are held and which is contracted out to a private security firm. In all those 20 years Harmondsworth has known no problems comparable to those of Risley or Holloway or Wandsworth. The tenders which private companies will put together in their bid for a slice of the penal cake stipulate the provision of single cell accommodation, each with its own internal sanitation. The government will pay for each prisoner held but guidelines will be designed to prevent extra profit being made by overcrowding the private prisons in the same way as routinely happens with the state ones. There would be an in-built sanction against any breach of the specified standards in the termination of the contract, which would in any case have a limited term. Finally, if the inmates in a private prison had the kinds of problems which they are all too familiar with now, it could hardly be more difficult to complain to some managing director than it is now to get at the Home Secretary. It might also be that MPs will be more vigilant, more penetrative and questioning about private prisons than they are now allowed to be about the Prison Department at the Home Office.

Perhaps the opponents of privatisation are worried about the size and the origins of the companies who are bidding for the contracts. The most prominent of these is Contract Prisons, made up of property developers Rosehaugh in partnership with Racal Chubb (who already supply those prison locks which rattle and slam all day long) and a firm called Pricor which was early on the scene of running private prisons in Tennessee. Big rivals to Contract Prisons are the combines made up of the building contractors Mowlem and McAlpine linked with the American Corrections' Corporation (in which Kentucky Fried Chicken have a stake — perhaps a foretaste of a change in prison diets) and another which links the construction firm Tarmac with the private security company Group 4 and the Midland, whose claim to be the listening bank would be fully tested if it came to hearing prisoners' complaints. 

Naturally, these companies are interested in making profit and will go into the prison business only if there is a clear prospect of this happening. Although the present, state-run system does not operate in exactly that way it is wrong to assume that therefore it is disconnected with the matters of capital investment, the production of profit and class monopoly of the means of life. Prisons are part of a large, powerful and costly system which exists to discipline us into an acceptance of class society, its property rights and all they mean in terms of privilege for one class and deprivation for the other. That this is an all-pervading social reality can be seen from the fact that the overwhelming majority of offences — the acts which can land us behind bars — are against property and that many of those which involve violence against people have as their object the theft of property. In 1987 of the 3,892,200 offences recorded by the police only 166,200 were of violence against the person; 32,600 were of robbery in which there may have been violence; while 3,674,100 were against property pure and simple. To combat this assault on their superior social position the capitalist class pay out a lot in taxes to maintain a police force, a judiciary and a penal system. This is by way of an investment the dividend of which, they hope, will be paid indirectly through a more stable, manageable, profitable society of class privilege and exploitation. The argument that direct and open private investment in building and running prisons is immoral because they are institutions of human punishment and confinement is very much a last resort. Such investments are part and parcel of capitalism's economy. Worker exploitation is itself a form of slavery. of confinement and stress. Capitalism sinks huge resources into armaments; to protect profits it will stockpile food or deter production of it while millions are starving to death. It pollutes and destroys the essentials of our environment, if profitable production demands it. It justifes all manner of assaults on our conditions and our lives in the sacred name of economy — of cheap production and bigger profits. What sort of hypocrisy is it which accepts the social system responsible for all this yet strains at the gnat of private prisons?

Not that the case against private prisons, even by the reformists' standards, has been made out for there is no conclusive evidence that they would lead to a worsening of prisoners' conditions. The debate between the two methods of running prisons is an irrelevance. If instead we adopt the more viable and logical standards of considering human interests, the debate becomes about a society which does not have the dominant ethos of locking away its human problems and then arguing about whose hand should turn the key.

Ivan

Political schizophrenia (1989)

From the January 1989 issue of the Socialist Standard

ON THE ONE HAND, all over the world people are deeply saddened by the magnitude of the Armenian disaster. 100,000 workers, many living in matchbox housing built on the cheap, were killed in what insurance companies call an "Act of God". (Sure must be a good god who puts on these murderous acts.) The thought of men. women and children, just like us and those we know, being killed instantly or left in the rubble of collapsed cities and towns makes us weep.

ON THE OTHER HAND, the same people who weep over 100,000 Armenian dead vote for a "defence" policy based on the principle that "our" security can be best achieved by threatening to bomb the Russian Empire (of which Armenia is a part) and kill hundreds of thousands of workers. The Armenians live and die under a state dictatorship; they do not vote for their foreign policy. But most British workers vote on the basis that it is quite reasonable to murder men, women and children and turn the towns and cities in which they live to dust.

ON THE ONE HAND, democracy means that a majority is allowed to have its way. We would not call an election democratic if 10 percent of electors voted for A and 50 percent voted for B — and A won.

ON THE OTHER HAND, Britain’s “freedom-loving" government has passed a Housing Act which calls a democratic election one in which the views of the minority can prevail. If a local council wants to sell off its council estates to private landlords, the new law states that a referendum must be taken of the tenants involved. Votes in favour of selling to a private landlord may be far fewer than those against, but those tenants not voting at all have their votes added to the "fors". so that a majority of "againsts" can be defeated by a minority of “fors" plus the abstentions. Torbay Council has already conducted a referendum on the basis of this new definition of democracy.

ON THE ONE HAND, the government is in favour of the deregulation of franchises for TV channels. They say that the public should be allowed to decide what they view. To the allegation that running TV on the same basis as the press will lead to TV barons producing tabloid trash, the government says that people are free to watch what they like.

ON THE OTHER HAND, the government has banned the advocates of certain ideas from being allowed on TV because viewers may be taken in by them. This act of censorship is defended by those who say that workers' minds should not be exposed to the defenders of illegal terrorism.

ON THE ONE HAND, prices are supposed to be an indication of what people need. All economics text books explain that without prices, high and low. to reflect demand for goods there could be no rational allocation of resources.

ON THE OTHER HAND, 15 million children starve to death annually in a world of food mountains. They cannot afford the price of food. In the eyes of the market they are invisible because they cannot pay the market price and give the food owners a profit. “Rational allocation" under the profit system equals mass starvation, while farmers are paid not to grow food.

ON THE ONE HAND, all decent people deplore child abuse, particularly of a sexual nature. The News of the World (6 December) — went into the horrific details of how twisted men indecently abused a young teenage girl.

ON THE OTHER HAND, the same issue of the newspaper displayed a virtually nude photograph of a thirteen-year-old girl who readers are told has exciting sexual fantasies. For whom was such a picture included, if not the very men who regard children as sexual objects?

ON THE ONE HAND, defenders of capitalism say that socialism could never work because human co-operation runs contrary to human nature. Despite the fact that whenever there is a social disaster floods of workers rush to help the victims, they say that humans are basically selfish and anti-social.

ON THE OTHER HAND, defenders of capitalism are constantly asking workers to act more co-operatively towards their bosses. They point out, quite rightly, that capitalism would not be able to make profits without workers agreeing to behave in a relatively selfless, co-operative, social spirit.

ON THE ONE HAND, psychiatrists define schizophrenia as an illness involving the perception of contradictory realities in the one mind.

ON THE OTHER HAND, the ideas which defend capitalism seem to fall into exactly that category. You can only defend the ideas of this crazy social system if you push all of your more reasoned, experience-based ideas to the back of your mind. Capitalism does not refer to such thinking as a psychiatric disorder which needs to be remedied; it sees such ideas as "common sense" and encourages workers to entertain such absurd contradictions in their minds.

SOCIALISTS

- offer sympathy to the victims of the Armenian catastrophe, but do not advocate a policy of killing even more Armenians at a later date.

- maintain that democracy means the majority having its way, always doing its best to make room for the wishes of the minority in any situation.

- favour TV output which will give viewers free access to all ideas and images they may choose to see. and oppose all bans on what we are allowed to see.

- reject the economics of capitalism, which assert that we need buying and selling and prices to determine what people need; priceless, free access to all goods and services for everyone is the only way to allocate goods efficiently.

- are sickened by the abuse of children, and by millionaires like Murdoch who make a profit by selling child porn in their so-called newspapers.

- repudiate the myth that humans are inherently anti-social and uncooperative, and state emphatically that human nature is no barrier to a sane, socialist society.

If you think the same way. then why not find out more about The Socialist Party with a view to joining us?

Steve Coleman

50 Years Ago: The Use of the Vote (1989)

The 50 Years Ago column from the January 1989 issue of the Socialist Standard

Whether votes are a power or not depends upon the type of men who cast them. If the voters are shiftless persons who only live by the favour of the rich, or wage-earners whose mentality is such that they regard the capitalists as "bread-givers", such workers will certainly not capture political power through the vote they cast. So far as they possess the vote at all. they will rather be inclined to sell the political power which it represents to the highest bidder.

The case is different with workers in a society which they sustain, and which would collapse without them. When the workers form a majority and are conscious of their importance to society, their voting for the Socialist Party signifies that they have recognised their strength and are determined to make use of it.

Kautsky's The Labour Revolution (Allen & Unwin. 1925. page 30).

[From the Socialist Standard, January 1939.]

Balancing the books (1989)

From the January 1989 issue of the Socialist Standard

President Reagan came under continuous criticism from Mrs. Thatcher and the heads of governments in several other countries because, for some years, the American Federal Government has been running a large budget deficit; that is to say it nas been spending more each year than its ordinary revenue from taxation and other sources, and making up the deficit by borrowing and thus adding to the national debt.

A second criticism levelled at Reagan was that America has a huge adverse trade balance, exports being insufficient to pay for imports, the deficit being met by loans from abroad. It is not intended to deal with this except to point to a difference between the two kinds of deficit. While it is possible for all governments in the world to run a budget surplus at the same time, it is not possible for all governments simultaneously to run a favourable trade balance. World imports and world exports are the same, one country's exports being another country's imports. The relative position of countries constantly alters: Japan now leads in respect of the size of its favourable balance: some twenty years ago it was the United States, with Japan showing a big trade deficit.

As regards criticism of the American budget deficit by the British and other governments. Tim Congdon in an article "Do these debts really matter?" (Times, November 1988) showed that many of the critics are not in a position to object, in view of the state of their own budgets. The American budget deficit in 1988 was an amount equal to 2.3 per cent of annual national income (Gross Domestic Product), which is less than the deficit in France (2.5 per cent), Germany (2.6 per cent), Canada (3.3 per cent) and Italy (10.2 per cent). The British government, too, has been running a budget deficit for many years, although the amount is less then the American 2.3 per cent of GDP and there is now a commitment to run a balanced budget or even a surplus in future.

The new President, George Bush, turns a deaf ear to the criticisms and intends, it appears, simply to wait in the hope that increased government revenue will wipe out the deficit by 1993, without any increase of taxes. The American House of Representatives' Budget Committee does not believe this and forecasts that the deficit will continue to increase and reach 50 billion dollars by that date (Times, 22 November).

The attitude of governments and economists to budget deficits has undergone a big change since last century both in the United States and Britain, partly because of the different view taken of borrowing. In the nineteenth century and the first half of the present century workers were strongly urged never to get into debt. It is all different today. The workers are under ceaseless pressure to “borrow now, pay later”. This changed attitude has helped to weaken the earlier attachment to the idea that normally Government budgets should be balanced and recourse to borrowing exceptional, as during war or for some large, longer-term government expenditure like expanding the navy.

In recent years, before Reagan's presidency, the tradition of a balanced budget had been re-established in the United States but it was certainly not observed by President Roosevelt during the depression of the 1930s. His government ran a huge deficit from 1933 to 1939 and continued to do so during the war. The Roosevelt “New Deal” signalled the conversion of most economists to the doctrines of J.M. Keynes, involving as it did a new look at budget deficits.

Before Keynes the usual reaction of governments to the onset of a depression was to meet the fall of tax revenue due to reduced incomes from profits and wages by cutting government expenditure and increasing the rates of tax — the aim being to maintain a balance between government revenue and expenditure without borrowing. The Keynesian remedy in a depression was the reverse — cut taxes, increase government expenditure by borrowing and run a big budget deficit.

Under Reagan's presidency unemployment has fallen below 6 per cent, the lowest for 14 years, and there are more workers in work than ever before in American history. As might be expected the Keynesians claim that this is proof that if the government spends more by borrowing and runs a budget deficit this will create more jobs and maintain full employment. It is wrong in theory and is not supported by experience. If a government spends more, whether it gets the additional money by taxation or by borrowing from investors, the inevitable consequence is that the taxpayer and investor spend correspondingly less. The true picture is that capitalism goes through a continuing cycle of depression, expansion, overproduction and depression irrespective of the budget or other policies of different governments. The abnormally low unemployment under the Attlee Labour Government 1945-1951 could not have been due to a Keynesian budget deficit policy because the government was running a budget surplus.

The best example of the irrelevance of Keynesian doctrine is to compare the Roosevelt “New Deal” with the way the British government dealt with the depression in the same years. Roosevelt's policy was Keynesian. The British government's policy was the reverse, that of cutting government expenditure and increasing taxation to aim at a balanced budget. In spite of opposite financial policies unemployment took much the same course in both countries. In the United States it rose from 8.9 per cent in 1930 to a peak of 25 per cent in 1933, and in 1938 — five years after Roosevelt became President — was still 19 per cent. In Britain it reached a peak of 22 per cent in 1932, and in 1938 was still 13.5 per cent.

The Labour Party's view of budget deficits is particularly interesting. They are committed to a big increase of government expenditure and a budget deficit in the belief that it will wipe out unemployment. Yet the last Labour Government, 1974-79, ran a big deficit and saw unemployment go up from about 600,000 to 1,300,000. Labour Party policy, laid down in a Report to 1944 conference had this to say: “If trade is bad or even showing signs of turning bad, then is the time for a budget deficit". In 1976 the Callaghan Labour Government threw the Keynesian doctrine overboard because he said it would cause inflation:

Continued inflation in the UK would lead to further hardship and unemployment. Therefore the Government rejected the panacea of pumping more funds into the consumers' hands so that the internal economy could be expanded (Times, November 1976).

What caused this repudiation was that two different Keynesian policies presented the government with an inescapable dilemma. One Keynesian doctrine is that the cure for inflation is to run a large budget surplus (see Harold Wilson's Remedies for Inflation, 1957. page 11). The other is that the cure for unemployment is a large budget deficit. But under the Labour Government between 1974 and 1976 unemployment and prices were both shooting up rapidly and there is no way in which the budget can be in surplus and deficit at the same time.

While governments have no control over unemployment — it takes its own course — they do have control over the general price level and can stabilise prices if they so decide, as in the nineteenth century up to 1914; or reduce them as in 1920 —1925: or push them up as Labour and Tory governments have chosen to do in the last half century. Why they have chosen to do this (or have slipped into it out of total ignorance of the monetary theories known to governments in the nineteenth century and in 1920-1925) is something of a mystery.

Reverting to the criticism made by other governments about the American budget deficit, the Times (8 November) says that their specific accusation is that it is "the prime cause of continuing international financial instability". We have news for them. As Marx showed, capitalism is an inherently unstable economic system and there is nothing governments can do to make it stable.

Edgar Hardcastle

Stock Market shake-out (1989)

From the January 1989 issue of the Socialist Standard

They said it would never happen again. Never again would there be mass unemployment. Never again would there be a stock market crash. Capitalism had overcome its contradictions and prosperity would be permanent. Marx was wrong and Keynes was right. This was the message put over by the economic gurus of capitalism in the 1950s and 60s.

This illusion began to shatter in the early 70s when falling profit levels led to closures. redundancies and rising unemployment in all the major industrial countries of the world. Soon the number out of work in these countries reached mass proportions. Ten, eleven, twelve, thirteen per cent of the workforce rather than the two or three per cent that economists claimed would be the norm under post-war capitalism.

Despite this industrial slump the boom on the stock market continued after a slight falter. But sooner or later this boom too had to come to an end, since capitalism can't change the fact that the source of wealth remains the actual production of physical goods and services and not financial juggling. No wealth is created on the stock exchange or on any other financial market. All that happens on these markets is that existing wealth changes hands. The same is true of all financial institutions — banks, insurance companies, building societies, pension funds and so on — they are all involved in mere money-changing, not wealth creation.

The basic economic role of financial markets under capitalism is to channel finance to productive industry, although these markets can also develop a life of their own divorced from the reality of production. The stock exchange is a market on which the stocks and shares of capitalist firms are traded. Normally the price of a firm's share reflects its profit-making record and prospects but, as on all markets, day-to-day prices are determined by supply and demand. If the demand for shares keeps on rising then so will share prices. This is precisely what happens in a stock market boom. Share prices keep rising, not because the profit prospects of the firms whose shares are traded are improving but simply because the monetary demand for shares goes on increasing

Under these circumstances people can make money simply by using a telephone, buying shares on credit in the morning and paying for them in the afternoon after selling them at a higher price. (This is all the Yuppies used to do.) But share prices can't go on rising for ever. Sooner or later the bubble must burst. As it did on the Stock Exchanges of the world at the end of October 1987 Reality reasserted itself and the stock market boom came to an end.

Because the Great Slump of the 1930s was preceded by the Great Stock Market Crash of 1929. many wondered whether the Crash of 87 was not going to herald some Great Slump of the 1990s. Labour MP Ken Livingstone, for instance, immediately went on record with a prophecy: "It's not just a slump that has happened on the stock market: it will be the worst recession that has happened since the Second World War and it will change all political relationships and all economic and military relationships" (Guardian, 26 October 1987).

The trouble with a prediction of this sort is that it ignores a fundamental difference between the crash in 1987 and that of 1929. The 1929 crash occurred in a period of capitalist prosperity, the source of the demand that fuelled the stock market boom being the increased profits made in productive industry. 1987's crash , on the other hand, occurred in the middle of a slump, the source of the extra demand for shares being the cash capitalist firms had available because they were not investing in productive industry. In other words, the 1987 crash does not need to herald a slump since it occurred in the middle of one.

In any event slumps are not caused by financial crashes even if, historically, they have often been preceded by one. They occur as a result of developments in what even capitalist economists have taken to calling “the real economy", that is to say, the world of the actual production of wealth. Under capitalism wealth is not produced for use but for sale at a profit. Profit is in fact the motivating force of the capitalist economy. All firms seek it and all their activities are subordinated to this end.

A slump is by definition a time when firms have cut back their investment in production, but they will have done this because investment in production on the previously-existing scale has ceased to be profitable. Profit prospects fall when a market has become glutted through overproduction (in relation to market demand not real needs, we hasten to add), as inevitably happens from time to time under capitalism since the competitive struggle for profits between rival firms leads to over-confidence and the production between them of more than the market for their goods can absorb, at least at a price that yields a profit.

If this overproduction has occurred only in some minor sector of the economy then the cut-back will be largely confined to that sector. But if it occurs in some key sector, such as steel, shipbuilding or car manufacturing. then this will have a knock-on effect on the whole economy as its suppliers, and their suppliers, and so on, are forced too to cut back on production and lay off workers. The result is a slump, be it a really major one as in the 1930s and 1880s or less severe one like that we have been in since the mid-1970s.

The stock market crash on top of the mass unemployment that returned in the 1970s, finally disposed of the myth cultivated by defenders of capitalism in the exceptionally long boom that followed the Second World War.

Editorial: A grim New Year (1963)

Editorial from the January 1963 issue of the Socialist Standard

It is with us again, this condition they have repeatedly assured us was gone for good. Unemployment at the end of 1962 was pressing stubbornly upwards and was expected to top the 600,000 mark with the turn of the year. Once again we are seeing a lengthening of the dole queues. Some sections of workers have been affected more than others, such as those in manufacturing and construction. There has, for some time, also been widespread unemployment amongst teenage school leavers.

In case we should be particularly startled by its reappearance in Britain, we should not forget that other countries have suffered more or less continuously for the past few years. The U.S.A., for example, has had around five million jobless for some time and in Canada some ten per cent of the labour force have been affected, Western Germany, Italy, Austria, Belgium and others—the list is hefty and depressing. Northern Ireland has had persistently high unemployment for a long time, despite the millions spent by her Government on industrial works and attempts to attract foreign capital.

Signs of strain, then, are appearing all over the capitalist world, and as far as British Capitalists at least are concerned, they have lost any confidence they may have had in an everlasting boom. There was a time not so long ago when they would have hoarded labour during comparatively minor trade setbacks, in the expectation of an early improvement. Those were the days when they were still scared of losing their skilled workers in conditions of almost chronic labour shortage. But how times have changed. “Surplus” workers are being sloughed off as profit margins shrink and the struggle to sell reaches cut-throat proportions.

A grim picture indeed! We have always been more than a little sceptical about stories of working class post-war prosperity. It has taken the present recession to tear away the flimsy facade and show once again just how insecure workers’ lives really are.

In its cynical efforts to make political capital out of workers’ misery, the Labour Party blames the Government bungling for the onset of the crisis, and thus reveals its own abysmal ignorance of the world in which we live. The Gaitskell set still urge Macmillian to “plan for expansion” under conditions of tightening markets and falling profits. They conveniently forget that it is precisely the previous plans for expansion which have gone awry. The present plight of the steel industry, for example, should illustrate this very well.

No, Macmillan and his crew are floundering in a sea of Capitalist chaos just as any other Government would have done. They know that the unemployment problem may cost them votes and they would like to solve it if they could. But it baffles them because it has its origin in the very system which they are administering. Capitalism is unplannable and inhuman. It is based on the private ownership of the means of life and the production of goods for sale and profit, and workers will be employed only so long as it is profitable for capitalists to do so.

We are seeing again the intensifying of human hardship side-by-side with surpluses of goods which the market cannot absorb. Which should just serve to remind us that Capitalism is still a system of bitter contradictions which no government can iron out. They will disappear only when capitalism itself is abolished and Socialism takes its place.

News in Review: CND's "new" plan (1963)

The News in Review column from the January 1963 issue of the Socialist Standard

CND’s '‘new” plan

Once upon a time there was an organisation, which stood for nuclear disarmament. A lot of people joined it and not all of them were beatniks or angrys out for a punch up with the cops. They did a lot of work and made a lot of fuss with their demonstrations in Trafalgar Square.

Some of this organisation’s members said that they were Socialists, but they thought that Socialism should wait because the first priority was to have capitalism get rid of its nuclear weapons.

When the Russians let off a whopping great bomb they went to the Soviet Embassy and said that they would not leave until they had an assurance that no more bombs would be tested. When it was time for the Embassy to close the police came and carried them out into the street.

They went on thinking that they could get capitalism to scrap its nuclear bombs.

Then the Cuba crisis came and everybody, including the organisation, got the wind up. A lot of people began to doubt the theory that the two disputing blocs of capitalism could keep the peace in a state of mutual terror, and they said so. They were a bit slow in this—Socialism had been pointing it out ever since the deterrent theory was born, which was a long time before the nuclear bomb came along.

So the CND dropped their own bomb. There is, they have decided, a new order of priorities. The first one is to get the support of as many of the deterrent-theory doubters as they can. They have guessed that this is unlikely to happen unless they modify their old policy.

The first urgency now, according to CND, is to limit nuclear weapons to Russia and America. Perhaps they have not noticed that these are the very two countries which are the most likely to use such weapons, because they are the countries who are currently disputing on a world-wide scale.

But the important point is that CND has gone the way of so many other organisations whose members said that they wanted Socialism, but thought that the revolution should wait until they had got some sort of reformed capitalism first.

All of them started out with a bold, dramatic policy which stirred up some support. Then the need to attract more members persuaded them to modify their policy and to keep it more in line with the requirements of capitalism.

Perhaps one day CND will end up like some of the others—a staid, responsible pillar of capitalist society, nuclear weapons and all.

This need be no fairy story. And there is no happy ending.

Supersonic Airliner

Among clouds of misgiving, with hardly a cheer raised for it, the project for an Anglo-French supersonic airliner —to be called the Concorde—has got off the ground.

The economics of the thing are dicy. The £150 million aircraft is the biggest—in size and money—aviation venture ever to have been launched in Europe.

The British and French governments hope that the Concorde, flying at around 1,500 miles an hour, will capture the market for big, fast, long range airliners which will be open when the last of the present type of jets are played out, in about seven years’ time.

But right now the American aircraft industry is examining the prospects for a Mach 3 airliner. If this project comes to reality the Anglo-French giant will probably be out of date a few years after its first flight and a lot of expensive aircraft will be up for sale at knock down prices.

This was the fate of the Britannias and the Comets, both of which have been beaten out of the market by the big American jets. BOAC, once bitten, is distinctly shy of the supersonic project. They will not buy it, they say, unless they are assured that ". . . the Anglo-French supersonic aircraft will be economically operable and competitive for a period equal to that currently used in accounting practice.”

But if there are uncertainties that the Concorde will make money, nobody doubts its ability to make a lot of noise. People who have been driven to distraction by the scream of the jets now have to look forward to supersonic booms rippling regularly over the country. (The more powerful American aeroplanes will probably be worse for noise than the Concorde.)

The government, of course, knows of this, but have shrugged the problem off. The damage from the booms, says Minister of Aviation Julian Amery, will be "negligible”—a sweet word, the meaning of which is gradually changing as politicians use it consistently to assure us that something which they know is harmful is actually almost good for us.

The British airlines, and the British aircraft industry, cannot afford to be left out of the scramble for speed and more speed, which for some of them is the only hope of making any profit. So they are committed to something which even by capitalism’s standards is unlikely to be a success.

By human standards the thing is a complete write-off. It makes us wonder what inhuman, stupid, pointless venture capitalism will think up next.

Unemployment

While Mr. Maudling talked, the unemployed figure went up and the number of vacant jobs went down, so that on a graph a great gap yawned between the two lines.

There were all manner of indications that this increase in unemployment is more serious than any other recent bout of it.

The total for November was the worst for that month since 1940. The number of wholly unemployed increased from mid-October to mid-November at over twice the normal seasonal rate. The Northern region had the highest percentage of unemployed since the Ministry of Labour began keeping regional figures, in 1949.

And all this was happening after the reductions in Bank Rate, after the easing of credit restrictions, after the cuts in purchase tax and the other government measures which, the City Editors so often tell us, cannot fail to stimulate the economy.

Yet the economy remains stubbornly unstimulated. Gloomed The Guardian on November 23rd last: ". . . business is no more confident now of good times ahead than it has been all summer . . . the New Year unemployment could reach a new post-war high. . .”

Now anyone with a moderately long memory will recall that the great, post-war security schemes were supposed to have taken the sting out of unemployment.

The fact is, though, that in one way the out of work are worse off now than they were before the war. A single man can now get £2 17s. 6d. from the dole which is about nineteen per cent. of his average earnings when he is in work. In 1924 the dole was 32 per cent, of average earnings: since then this percentage has steadily decreased.

The present day percentage of nineteen compares to 90 per cent. in Germany. 70 per cent. in Holland and 60 per cent. in Switzerland.

There is a simple way of summing this up. The promises which were made for capitalism during the last war—that life would be freer and more secure when the shooting had stopped—have been exposed.

It is still possible, even likely, that masses of workers in this country can be unemployed. Slumps are still around every corner. All the promises which are made for capitalism are empty lies.