Editorial: The Labour Party’s Thirty-One Years. (1931)

Editorial from the March 1931 issue of the Socialist Standard

Workers Worse Off

The Labour Party was formally constituted under its present title in February, 1906, after the General Election at which twenty-nine Labour M.P.’s were returned. Six years earlier the Labour Party’s predecessor, the Labour Representation Committee, was formed. The Independent Labour Party, which was largely instrumental in bringing about the later developments, was formed in 1893—nearly forty years ago.

All three bodies were based on the same general set of ideas. They rejected the possibility of winning over the workers to Socialism by the direct method of preaching clear-cut Socialist principles, and based their hopes on the policy of winning support by the indirect method of social reforms. They argued, not without some show of reason, that the workers were interested in day-to-day issues containing the promise of immediate advantage, and were not interested in the broad question of the organisation of society. Those who retorted that the job must be tackled of changing the workers’ outlook were pushed aside. They were told that practical work would prove far more effective than mere criticism of capitalism and preaching of Socialism. The Socialist Party of Great Britain was a voice crying in the wilderness. Our warning that capitalism would frustrate all the practical work as fast or faster than it could be achieved, and still leave Socialism unattained, was ignored or derided. Now that thirty-one years have passed and the Labour Party has twice been in office, it is opportune to look back and judge of the truth of our criticism. How have the facts treated the Labour Party’s theory?

Are the workers better off? Have they improved their position relatively to that of the capitalist class? Is life more leisurely for them and more secure? Have extremes of wealth and poverty been abolished? And, a last question, are we nearer to Socialism?

Speaking broadly, all of these questions must be answered in the negative. We have had reforms innumerable; Liberal reforms backed by the Labour Party; Tory reforms; and Labour reforms backed by Liberals. The political wheel has gone full circle. A Labour Party once subordinate to the Liberals has won to power, and now it is Mr. Lloyd George who must go each week to 10, Downing Street, for consultations on the joint Liberal-Labour policy.

But the enactment of reforms has been like pouring water into a leaky bucket, Nearly every additional expenditure by the Government on social reforms to remedy some pressing working-class evil has helped to lower the workers’ cost of living. What the workers have received in the shape of sick benefit, unemployed pay, etc., has been used by the employers as an excuse—admitted or unadmitted—for seeking to reduce wages. What has been gained at great effort in one direction has been wholly or partly taken away in another. As the Liberal economist, Professor Clay, admits in his book, “The Problem of Industrial Relations,” the increase in expenditure on social services has not been a clear addition to wages, but “has followed and to a large extent compensated for, the check to the rise in real wages . . . about the end of last century” (p. 249).

Up to about 1897 the purchasing power of the workers’ wages was rising. Since that date real wages have fallen. Against social services, therefore, must be set the decline in real wages and the increase in unemployment. Professor Clay admits that from 1895 to 1913 prices were rising more rapidly than wage rates, in spite of “a rapid increase in the country’s wealth” (ibid., p. 212).

Professor Pigou, writing in the Economic Journal for June, 1923, said : —

“The rate of real wages actually declined between the later ‘nineties and the outbreak of the Great War.”

The Labour Research Department (this is not a Labour Party organisation) made an attempt to compare real wages in the years from 1900 to 1928.

Their estimate was based on official figures, and allowed for unemployment and for changes in the cost of living. It showed that in 1928 the industrial workers were about 6 per cent. worse off than in 1900 and about 5 per cent. worse off than in 1914. (See L.R.D. Bulletin, January, 1929.)

The Labour Party’s own Research Department made a similar inquiry (see Labour Bulletin, June, 1929). They found that real wages, after allowing for changes in prices and in the amount of unemployment, were in 1928 practically the same as in 1914, but slightly less (1.6 per cent.) than in 1900. Since 1928, according to recent issues of the Labour Bulletin, real wages have fallen 3 per cent. or 4 per cent. They have continued to fall since the Labour Government came into office.

We do not claim for any of the estimates quoted above that they are more than approximate. The subject does not permit of absolute precision. They are sufficient, however, to indicate the trend of wages.

What we emphatically must say is that nothing has been achieved by the reform parties in the past thirty or forty years in any way commensurate with the vast expenditure of energy by two generations of enthusiastic supporters of the Labour Party. We do not believe that those who joined the Labour Party would have toiled for 31 years if they had realised then what small and uncertain results would come from their efforts. Would they have been so confident of the soundness of their policy if they could have foreseen that after all their labours the proportion of the national income received by the wage-earners would fall from 47.4 per cent. before the war to 45 per cent. to-day? That is the admission of the Daily Herald in its editorial on February 13th.

And none of the hardly won reforms are certain gains. A period of acute unemployment like the present, accompanied by wage reductions, may in a few months wipe out the savings of a lifetime and destroy the wage standards defended by years of effort. Then, in the midst of the hard struggle of the workers, Mr. Philip Snowden, Chancellor of the Exchequer, announces that we must all be prepared for sacrifices: “The sacrifice the workers might have to make would be a temporary suspension in schemes of social development.” (Report in Daily Herald, February 18th.)

The Labour Party believed in reforming capitalism, but finds when in power that those very capitalist evils which the reforms were to solve, themselves make further reforms impossible at the very time when the evils are greatest. What a fate for a thirty-years-old movement ! !

We prophesy that the Party which rose to power by exploiting the discontent arising from the effects of capitalism, and which undertook to deal with those effects, will be hoist with its own petard. Discontent made the Party. Sooner or later discontent will break it. Already Mosley and others have broken away.

The Socialist policy of tackling the cause of working class poverty, and abolishing the capitalist system of society, was unassailable in 1900 and is still the only way out for the working class.