Social revolution in Japan
Under the above heading The Times told us recently of changes in Japan brought about by the war. But if the reader expects to learn that the wealth producers, the Japanese workers, have taken over, he will be disappointed though he should not be surprised. What in fact the article deals with primarily is the rise of new propertied group and families in place of the old.
The richest man in Japan has an income of 440m. yen (£440,000) a year. He is Mr. Konosuke Matsusha, chairman of the Matsusha Electric Industrial Company. His declared income is nearly twice as large as that of anyone else in the country. According to figures based on tax returns for 1962. the 20 richest men in Japan have incomes ranging from £121,000 to £440,000. All but one are industrialists. Some of the names in the list are almost unknown to the general public and the famous pre-war names—Iwasaki (founders of the Mitsubishi combine), Okura, Mitsui and Sumito Mo—do not appear anywhere.
Of course, there has been no social revolution for the other Japanese, those whose names are always unknown. The latest figures published by the International Labour Office show average earnings in Japanese manufacturing industries, ’’including family allowances and end-of-year bonuses,” as 22,834 Yen, or about £22 16s. 8d. a month.
Bigger and Fewer Breweries
Official figures published in the April issue of Economic Trends showed how far take-overs have gone in industry as a whole. In eight years, 1954-1961, £1,600 million was spent on take-over bids, but of this total nearly half came from the 98 companies each with assets of £25 million or more, though they represent only a tiny proportion of the 2,600 companies whose shares are quoted on the Stock Exchanges of this century. Altogether 3,400 companies were taken over (most of them not quoted on the stock exchange).
One industry in which amalgamation has gone far, but with more to come, is the brewing industry.
In place of a multiplicity of breweries many of them small and local, a writer in the Financial Times (May 25) writes of the industry now being dominated by six major groups.
What the boards aimed to achieve by take-overs was to consolidate brewing and distribution in large regions and thus achieve big economies and larger profits. Local breweries are being closed down and a considerable number of the local ”milds, bitters and light ales” are disappearing, ”no longer worth producing in small quantities.” Standardisation of a smaller number of nationally advertised brews is the order of the day for capitalism in brewing. It is ironic to recall the old argument against Socialism that it would deprive us of the variety of choice that capitalism gave us. Maybe the local varieties were no better (or worse) than the TV advertised popular brands, but that is not what drinkers were told before the change took place.
Common Market under a Cloud
When the drive for British entry into the Common Market was in full and hopeful flood the line taken by its advocates was to say that all was well inside the Six and British industry must be in to share in the benefits.
It was equally to be expected that immediately entry was blackballed by De Gaulle, they should nearly all have a change of heart and say that it really did not matter after all.
Now a few months have passed and some of the earlier arguments have begun to look rather thin. In place of the supposed absence of labour disputes we have seen massive strikes in France and Germany. French farming interests which were partly responsible for the objection to British entry have now brought the French and German governments into conflict, and both of them into conflict with American farmers over the entry of their exports into Europe.
The bloom has gone off the German industrial and stock exchange boom, because of falling profit margins and stronger pressure for wage increases.
At the same time, helped by some industrial recovery and rising profits, many British capitalists and politicians are thinking that they can do better out of Europe, and British exports into the Common Market have increased, as also exports to Russia.
The fact is that both before and after, the arguments were based on wrong or too limited assumptions. The European Common Market carries no more guarantee of permanent rapid expansion than any other large or small region of capitalism, and no more able to escape wage disputes and fluctuating profit margins.
And what happens to one industry inside or outside the Market is not necessarily the experience of other industries. . While motor car exports to Europe have been rising, and the Ready Mix Concrete Company claims record sales on the Continent, one firm, Wilmot Breedon, producers of motors, aircraft engines and domestic appliances, reports that the profits made in Britain were overshadowed by the heavy losses of its French subsidiary.
So for the moment the Common Market is rather out of favour.
What Mr. Profumo did to the Stock Exchange.
One of the emptiest dreams of the capitalists is to imagine to themselves how happy they could all be if only they could go on making, profits without the constant interruption of “politics." One of a cloudless sky politics keeps blowing up. On Monday, June 10th according to the Evening Standard, the London Stock Exchange had its biggest slump since Cuba—not this time the work of one of the K’s, but of Mr. Profumo. “Dealers, nervous about the eventual outcome of the Profumo affair, marked share prices down all round."
The same issue of the Evening Standard had an article asking whether Mr. Profumo, out of politics, can hope to find an outlet for his talents in business. The argument raises diverting side issues:
A man in public office has to have a high moral character and appear totally incorruptible. . . In business, however, standards are not always that high . . . But the business world doesn’t think much of a liar, especially if he gets found out
The writer of the article, the City Editor of the Standard, asks: “If he came knocking at your door would you give him a job ? ” But there is no urgency about it:
The ex-Minister of War comes from a rich family. The Profumos have for many years controlled the £34,000,000 Provident Life Association of London.Most of the shares are held by trusts in which Mr. Profumo has an important role. In 1961 the trusts sold some £1,000,000 worth of shares for cash in a public issue. But they still own around two-thirds of the company’s Ordinary share capital, Worth some £3,700,000 at current market prices.Mr. Profumo, of course, is only one of the beneficiaries. But he must draw quite a useful income from the investment.Last year Provident Life paid out £120,000 in Ordinary dividends, of which the trusts must have received a considerable share.
Edgar Hardcastle
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