Capitalism ‘bad’, socialism ‘good’ (2021)

Frank Luntz with sadness in his eyes.

From the August 2021 issue of the Socialist Standard

At the beginning of July two openly pro-capitalist think tanks – the Tory-leaning Centre for Policy Studies (CPS) and the free-marketeer Institute for Economic Affairs (IEA) – published the results of polls they had carried out on people’s opinion of capitalism. Both indicated that many people don’t think much of it.

The one for the CPS was compiled by US pollster, Frank Luntz:

‘ …Dr Frank Luntz is testing public opinion in Britain to find an alternative to ‘capitalism’, after 170 years of use, because he fears it is becoming a bad word ( … ) Capitalism itself is already a “bad word” in the US and is fast becoming so in the UK too. “It’s one of the key things I am trying to figure out: Does this country need an alternative to the word capitalism? I think it does”’ (Sunday Telegraph, 19 June).

In the event, he didn’t come up with an alternative, merely noting that ‘voters are almost as fed up with business as with politicians – presenting a huge challenge for supporters of capitalism and enterprise’. Those polled were asked to choose from a list four ‘words and phrases they thought of first when thinking about British companies’. The two most chosen were ‘Profits before People’ (47 percent) and ‘They put shareholders first, not ordinary people’ (44 percent). It is not clear why Luntz felt that these factually correct and easily verifiable statements represent a challenge to supporters of capitalism. Normally, its supporters are prepared to defend both as the best way of organising the production and distribution of wealth.

While the CPS poll was concerned with people’s attitude to ‘capitalism’ the IEA one was more concerned with their attitude to ‘socialism’. A representative sample of those aged between 16 and 34 were presented with a number of statements and asked whether they agreed with them or not, without the option of ‘don’t know’. 67 percent said ‘they would like to live in a socialist economic system’ and 75 percent agreed that ‘socialism is a good idea, but it has failed in the past because it has been badly done’. 78 percent blamed ‘capitalism for Britain’s housing crisis’ and 75 percent agreed ‘that climate change is a specifically capitalist problem’.

What are we to make of these results? Opinion polls are worth what they are worth and as Tory Lord Finklestein pointed out in his comments on the CPS one, ‘You can’t just ask consumers, and indeed voters, what motivates them, and trust what you get back’ (Times, 7 July). Those questioned are only being asked to give a fleeting opinion that commits them to nothing. And the questions can be framed to get the answer the pollster wants.

In these two particular polls, ‘capitalism’ was not defined. The tacit assumption of those who drew up the questionnaires (though not necessarily of those who answered the questions) was that capitalism meant production for profit by private capitalist enterprises. Capitalism is certainly a system of production for profit – in fact, the ‘Profit System’ might be the alternative name for it that Luntz is looking for – but ‘private enterprise’ is only one form of this. Capitalism can also take the form of state enterprises producing for the market with a view to profit. In both cases, the profit arises from the unpaid, surplus labour of the wage workers who are employed, whether by a private or a state enterprise, to produce what is to be sold.

The IEA didn’t define ‘socialism’ either, but the question about socialism ‘having failed in the past’ indicates that they think it is what existed in Russia – or, their current favourite, Venezuela. The concept of state capitalism is ruled out, even though the author of its report, Kristian Niemietz, had referred, in a previous report, to this concept and specifically to us:

‘… There are exceptions to this, such as the Socialist Party of Great Britain. They are not, and as far as I know, never were, apologists of Soviet-style socialism, which they describe as ‘state capitalism’. They are among the few socialists who have at least some idea of what they mean by ‘real’ socialism. They use that term to describe a hypothetical system in which working-class people own and control the economy’s productive resources directly, not via the state; a system in which public ownership is not mediated through a government bureaucracy’ (iea.org.uk/has-real-socialism-never-been-tried/).

Once again, it cannot be assumed that those who answered the question meant the same as those who asked it. Had the question been ‘Would you like to live in an economic system where all industries are state-owned?’ the result would have been very different. On the other hand, had the question been ‘Would you like to live in a system where the means of production are commonly owned and democratically controlled and the principle of from each according to ability, to each according to need applied?’ the result could well have been the same. But this wouldn’t mean that those answering ‘yes’ thought that such a system was achievable, only that it was desirable.

In an 80-page booklet analysing the results, Left Turn Ahead? Surveying attitudes of young people towards capitalism and socialism, Niemietz was more realistic as to what this meant:

‘The rejection of capitalism may never have huge real-world consequences. “We should ditch capitalism, and try a socialist alternative” may well be the political equivalent of “One day, I will learn a foreign language, run a marathon, and write a novel”. It may be an idea that is popular as an abstract aspiration, but less so as a concrete action plan’ (p.17).

Unfortunately, this is fair comment.

However, there will be some significance that, amongst younger people today, capitalism has become a ‘bad word’:

‘Young people associate “socialism” predominantly with positive terms, such as “workers”, “public”, “equal” and “fair”. (…) Capitalism, meanwhile, is predominantly associated with terms such as “exploitative”, “unfair”, “the rich” and “corporations”’ (p.7)

That can’t be a bad thing.

Adam Buick

The Beef Chain: A useful investigation (2021)

From the August 2021 issue of the Socialist Standard

‘Cattle ranches are destroying the rainforest enabled by giant beef companies while their US, EU (and UK) international financiers made flawed assessments.’

Above is a statement on the destruction and deforestation of large parts of the Amazon, both legal and illegal, taken from a lengthy 2020 investigation by Global Witness entitled Banks, Beef and the Brazilian Amazon (tinyurl.com/4y3bmcd6). It covers all aspects along the supply chain from cattle ranchers, beef traders, international financiers, supermarkets, fast-food chains and the governments which regulate them.

The numbers are staggering, whether those of cattle on ranches, size of forest cleared or the increased speed of the devastation in recent years. The investigation finished at the end of 2020 when there were approximately 390,000 beef ranches in Brazil, 40 percent of them in the Amazon. About 70 percent of cleared land in the Amazon is populated by cattle, and there are more cows than people in the country. Starting with ranches the chain continues with the beef dealers, including three Brazilian giants, which mostly control the slaughterhouses and sell on the beef. These three beef companies slaughtered more than 18 million cattle in 2017, equivalent to 40 percent of Amazon beef. These same multi-billion-dollar beef companies sell 64 percent of the total Brazilian beef exports to the EU, US and China. Next in the chain come the intermediaries who finance all aspects. These are the banks and big finance companies: the World Bank, Blackrock, ING, Barclays, Morgan Stanley, Santander, Deutsche Bank, BHP Paris, HSBC. Nearing the end of the chain retailers and fast-food outlets include Walmart, Carrefour, Nestle, Burger King, Sainsburys, Subway and McDonalds.

Beef production in Brazil is the number one cause of deforestation emissions across Latin America. According to the World Resources Institute more than 20 million hectares of Brazil’s Amazon primary tropical forest were lost between 2002-2018. Year on year forest fires driven by deforestation increasingly devastate more of the Amazon, all for the sake of profit while the planet shows all the signs of being out of control. In the years 2005-2013, before Bolsonaro became president, state interventions helped to bring about a 70 percent drop in Amazon deforestation. Bolsonaro, as president, has attacked safeguards and agencies protecting the Amazon and the situation has now become critical. Ranches fall into one of several categories depending on the age of the cattle. First are the ranches for breeding, from which the animals are moved on to rearing ranches and then to fattening ranches. When the time comes for slaughter they are moved once again, this time to the traders’ slaughterhouse facilities.

All traders are obliged to have no-deforestation pledges and to monitor the supply chain of beef to check both non-compliance with forest destruction laws and human rights abuses. Whilst the numbers are staggering a few of the examples mentioned here give some idea of the scale of this whole beef production topic. One of the three biggest beef traders briefly mentioned above, Marfrig, describes itself as the world’s second largest beef producer with a work force of over 30,000 employees. Gross profit in 2019 – over $1 billion. Marfrig claims to have met the Greenpeace agreement regarding protection of the Amazon rainforest and no illegal deforestation nor any human rights abuses for the previous five years. Another of the ‘big three’, JBS, had audits carried out by the DNV-GL company on behalf of Greenpeace and the Pará state prosecutor. The auditor’s Code of Conduct states that it must avoid ‘any combination of roles and services that could be perceived as representing a threat to the impartiality and independence of its services. We do not classify, certify or verify our own work.’ Their audits for the Greenpeace agreement claimed that JBS’s cattle purchases were 99.99 percent compliant (2016) – but its audits for the Pará prosecutor’s agreement the same year showed almost 20 percent of JBS’s purchases were not compliant.

Similar improper situations occurred with banks claiming to be compliant with laws and agreements relating to illegal deforestation. Such examples as a leaked document seen by Global Witness from HSBC to the JBS company heavily criticising them for giving no clear information or statement regarding the sources of cattle and for having ‘no vision, action plan, timeline, technology or solution.’ Then, in the same document, HSBC recommends that investors buy shares in JBS. Other examples reveal complicity in human rights abuses of workers and those forced from their land by threats and even murder. Some perpetrators have received heavy fines or prison terms, but most escape punishment.

The top ten countries importing from the three biggest beef suppliers include China 34.4 percent, EU 10.9 percent, Russia 6.65 percent, US 3.51 percent and UK 2.89 percent. The major retailers listed earlier tend to sign up to various treaties such as threatening to boycott produce if further land grabbing or deforestation continues but when contacted by Global Research with questions on progress or results there is often no reply.

If we look at the position of consumers, those at the end of the chain, in this case buyers of beef from Brazil and particularly from the Amazon, this report suggests that most will only have information from those they are buying from, that is supermarkets and fast-food chains. They will know where the beef was sourced but will be unaware of the various steps in the chain. If they were aware of, for instance, the global banks and their investors, plus the multinational beef traders funded by these banks, perhaps they would have second thoughts about their purchases. Over years many consumers have become aware of the harm done in other countries by the pension fund they are personally linked to and have protested to stop it. Many indigenous people in regions of the Amazon have been forced from their traditional lands, have been threatened and even killed for protesting, and continue to suffer threats and violence while trying to protect the forests which are their home.

Regarding the final section of the report which is related to what should be done, as is to be expected it is very detailed but also filled with unreal expectations of capitalism. All is tied up with law, the responsibility of traders, auditors, banks, financial actors, importers, supermarkets, federal environmental prosecutors and the Brazilian government. Having said this the PDF is well worth reading for the sheer amount of detail it offers on any and all of these important aspects, facts and figures, plus some mention of the loss of and risk to the many varied and endangered life forms, a topic from which too many are distant or ill informed. Diagrams and photographs give some added understanding of the enormity of the problem.

This global system of capitalism which thrusts separate countries into constant competition with other nations and forces many smaller states into positions of subservience to the more powerful is absolutely the opposite of what is urgently required if the planet is to remain a safe place for all life. Surely no one can be ignorant of the fact that we are one world and that all areas affect and are affected by others, whether as the result of mining for fossil fuels on land or in the sea, from emissions of global trade practices or, as we have here, massive destruction of the lungs of the world in order to raise more beef for sale on the world market.

Janet Surman