Tuesday, April 2, 2024

Cooking the Books: What would ‘good’ capitalism be? (2024)

The Cooking The Books column from the April 2024 issue of the Socialist Standard

‘Pet care rip-off is a case of bad capitalism’ ran the headline of Emma Duncan’s column in the Times (15 March), subtitled ‘Profiteering by vet chains and children’s homes will only bolster appeal of socialism to the young’. Let’s hope so.

Earlier that week the Competition and Markets Authority (CMA) had announced that it had identified ‘multiple concerns’ about what it called ‘the vets market’, including that pet owners were being overcharged and that the concentration of the firms operating in the sector put them in a position to do this.
‘In 2013, around 10% of vet practices belonged to large groups, but that share is now almost 60%, and many of the large groups have expressed an intention to continue expanding their business through acquisition of independently owned practices. To illustrate this another way, since 2013 1,500 of the 5,000 vet practices in the UK have been acquired by the 6 large corporate groups (CVS, IVC, Linnaeus, Medivet, Pets at Home and VetPartners)’ (tinyurl.com/5y4x2xf4 ).
This is a manifestation of the trend that Marx identified under capitalism towards the ‘centralisation of capitals’ — the ‘concentration of capitals already formed, destruction of their individual independence, expropriation of capitalist by capitalist, transformation of many small into few large capitals’ (Capital Vol 1, Ch 25, section 3). In the particular case of the market for pet care this has been facilitated not only by the greater amount of capital needed to invest in advanced equipment but also because of the prospect, as noted by Duncan, of making a bigger profit.
‘The rise in insurance has made pet owners largely indifferent to the prices that vets charge. Private equity firms — companies that buy up businesses they reckon could be more profitable — spotted this, and poured money into buying up individual practices.’
The same sort of situation, she notes, has arisen in the children’s home sector where ‘the CMA has calculated the average profit margin in the sector to be 19.4 per cent — “materially higher than we would expect”.’

Echoing Tory Prime Minister Ted Heath in 1973 who described some shady business practice as ‘the unacceptable face of capitalism’, Duncan sees this as ‘bad capitalism’. But is it? Is it not rather capitalism functioning as it is supposed to, with money-capital, such as that gathered by private equity firms, seeking out the most profitable investment outlet and then going for it?

It is all very well for a supporter of capitalism like Duncan to argue that the market ‘works properly only if toughly regulated’, but this is saying that it doesn’t work, in fact can’t work, properly. William Morris once pointed out that laws against adulteration wouldn’t be necessary if there wasn’t an economic incentive for firms to adulterate. Similarly, there wouldn’t need to be regulations to prevent rip-offs by capitalist firms if there wasn’t the incentive to do this.

If she wishes to win over the ‘53 per cent of 18 to 34-year old Britons’ who she cites as regarding ‘socialism as the ideal economic system’ (alright, most won’t know what socialism is but they will know that it’s not capitalism) she will have to come up with a better argument than she advances here.

‘Good capitalism’, apparently, is an economic system that requires (tough) government intervention to try to mitigate the effect of its basic economic imperative to seek and make profits. The ‘acceptable face’ of capitalism would be profit-seeking in accordance with Marquess of Queensberry type rules, rules that wouldn’t be necessary unless there was a tendency not to respect them. Socialists have a better solution. Produce directly to meet people’s needs, not for the market or profit, and there wouldn’t be any need for such rules.

Next Step for Humanity (2024)

Pamphlet Review from the April 2024 issue of the 
Socialist Standard

Socialism for Young Folks (and everyone else). By Jamshid R. Davis. Omnia Sunt Communia Press. 2023. 57pp.

The Socialist Standard recently reviewed a booklet about anarchism aimed specifically at young people. The review was largely favourable and ended by suggesting that the Socialist Party might itself consider producing a similar publication about socialism ‘presenting in simple terms what is actually a very simple idea – organising the earth’s resources collectively and democratically on the basis of needs not profit’. We now discover that Jamshid Davishas actually got there first with a publication (Socialism for Young Folks) that comes extremely close to our own critique of current society and our proposals for changing it.

At the very start, he defines socialism as ‘an economic system where the means of production (how goods are made) and distribution (how goods get into the hands of those who need them) are socially owned in common’, and where ‘distribution is not through markets but by free access’. Having established what socialism is, he then proceeds to explain (and denounce) what it is not. It is not nationalisation or state ownership or control, since that is simply state capitalism, where ‘government managers take the place of the regular capitalist bosses’ and ‘wage labour, markets, and money still exist and there is no free access to needed goods or services’. An adamant ‘no’, therefore, to, the dictatorships in places like China, Cuba, Vietnam and North Korea. Nor do so-called ‘national liberation struggles’ have anything to do with socialism, since they ‘never were anti-capitalist in the first place’ and ‘socialism is by its very nature a world system’.

The class nature of the capitalist society we live in and that dominates the world is then analysed succinctly and effectively (‘a class is a group of people united by their common interests within the economic order’; ‘those who own property or manage it have all the power within a society, while those who do not own property suffer, powerlessness, economic exploitation, and poverty’; ‘the working class is composed of folks who must sell their labour power to capitalists or to the state to be able to support themselves and their families’). The solution to such inequality, we are told, is the abolition of class society and ‘the construction of a classless society’. The historical perspective that then follows about the rise of capitalism as a social and economic order and in particular how it overcame feudalism is also interesting for the added dimension it gives to the situation the world’s workers find themselves in today and what they need to do to do to bring about change and create a new system of society. It points to how past systems of society have changed, even though, while they existed, they may have seemed permanent and everlasting. Attention is also paid to the variety of noxious effects of the capitalist system on all who live under it. This includes a short but penetrating analysis of the various kinds of alienation it visits on its subjects and the way it stymies creative potential, the inevitability of crises of overproduction known as recessions or slumps, and the system’s tendency to cause military conflict through the struggle for markets’ (‘the First and Second World Wars can best be seen as a struggle between the various capitalist blocs over the division of the world market’).

What we have here, therefore, is an analysis and prescriptions found relatively rarely among who label themselves socialist but who are in fact using the word to mean variations, proposed or otherwise, on how to run capitalism. Having said that, there are, nevertheless, certain aspects of this booklet’s thesis that we would find it difficult to agree with. These occur largely in the section entitled ‘The Road Yet Travelled’, where a fairly detailed recipe for bringing about socialism and then organising it is put forward. It would be established, it argues, by acts of workplace protest, local democratic self-organisation and, above all, by direct action, which is likely to involve violence, since, the author insists, the capitalist class will never willingly give up their wealth and their protectors, the state, will never allow the system to be overturned and a new one established democratically via elections. So the strategy advocated here rejects the kind of democratic political action via the ballot box that the Socialist Party sees as the most fertile route to the establishment of a democratic, moneyless, marketless society once the necessary spreading of consciousness of the need for this has been achieved. Without this particular form of direct action (ie, the ballot box), it is difficult to see how a socially conscious working class can take the power necessary to abolish capitalism and set about organising a genuine socialist society. Nor is it a given, as suggested here, that, once the overwhelming majority of class-conscious workers have indicated their desire to establish socialism, there will be armed resistance from the capitalist class and their governments. So there is a clear difference in ‘strategy’ here between the author’s view and that of the Socialist Party on the establishment of socialism, even if the desired result seems very much the same.

In addition to this, the author goes in for a fairly detailed blueprint for how the new non-market, free access society will be organised, stating firmly, in the tradition of ‘Council Communism’, that it will be based on ‘workers’ councils’. Again we would see this as no more than one hypothesis out of many other possible ones and would argue that, once a majority of workers opt for a society without money, buying and selling, and wage and salary work, they will formulate their own way of organising it. All we can say is that they will do this democratically, via voluntary cooperation and using the knowledge, resources and technologies available at the time.

Despite these differences of view, however, there can be no doubt about the value of this publication both for the ideas it puts forward and for the clarity with which they are stated. It is helpful, above all, in putting centre-stage the idea the Socialist Party itself has been propagating for 120 years – that of dispensing with capitalism and establishing a new society based on collective production for direct use. As the author himself puts it – and we could not agree more –, ‘a world community is now possible and is necessary for the further development of humanity’.
Howard Moss

50 Years Ago: Labour Government: The Worst of Illusions (2024)

The 50 Years Ago column from the April 2024 issue of the Socialist Standard

In The Observer on 3rd March, under the heading “Myths of the Election”, a Professor King proposed and praised the syllogism “I am working class, Labour is for the working class, therefore I am Labour”. The logic is fine; the premise is false. Certainly the Labour Party was built on the blind hope of working men and women that something better than the capitalist system offers could be obtained from the capitalist system. But for those who are not blind, it has done untold harm to the working class. First, by simply administering capitalism (whenever it gets the chance) determinedly to show it can do the same as the Tories. Second and more important, by its debasement of the word Socialism to a hucksters’ slogan — turning the true answer to working-class problems into a synonym for worthless reform and compromise.

The Labour Party is anti-working-class, but let the position be clearly understood. Intentions good or bad do not come into it: indeed, they are determined by capitalism. Some Labour politicians know what they are doing, others do not. Some begin with ideals, others with the desire for a parliamentary career. The forming factor, however, is that Labour sets out to be a governing party — that is, to take on running the capitalist system. Given that, all the failures and “regrettable necessities” follow. Because there is no way capitalism will run except its own way, and whoever tries to direct it is directed by it instead.

Nevertheless, it is impossible not to be appalled by the sheer charlatanism of the Labour Party, the mixture of cunning and stupidity which all its life has characterized it. (…)

There is a literary phrase: “the willing suspension of disbelief”. That seems to be the condition for supporting Labour. Granted, they could do no better if the utmost probity were their rule — the capitalist system is intractable. But, on the evidence, there must be a willing suspension of disgust too. This is the party no Socialist would join or vote for.

[From the article, Labour Government: the Worst of Illusions! by Robert Barltrop,  Socialist Standard, April 1974]

Action Replay: Kitted Out (2024)

The Action Replay column from the April 2024 issue of the Socialist Standard

Who will today’s game be between? Nike vs Adidas? Puma vs Umbro? Or maybe Castore will be potential giantkillers? All professional football teams have shirts and so on belonging to a particular brand, with the logo (the Nike swoosh, the three Adidas stripes, whatever) prominently displayed. Even official referees’ outfits in England are from Nike (farefereestore.thefa.com), but in Scotland they’re from Adidas.

And it’s all big business. Nike is the biggest sports company, with revenue of over $50m last year and over eighty thousand employees. It has been criticised for using sweatshops and child labour to make its products, and similar complaints have been made about Adidas, which has a minority share in Bayern Munich football club, and has revenue less than half that of Nike. Nike can count more Premier League teams as wearing their gear than Adidas, but in fact they have the same number as Umbro.

Both Nike and Adidas are long-established, but Castore, a British company, was only founded in 2015, and has just 500 workers. Yet it has been making progress, with three Premier League teams wearing its kit, together with Rangers in Glasgow, the England cricket team and the US national rugby team. They were involved in controversy towards the end of last year, with some of their shirts clinging to the wearers’ bodies when they became sweaty, which was particularly embarrassing for women players.

The kit manufacturers have contracts with the teams so as to ensure sales to supporters. Puma supply just one club, but that’s the champions, Manchester City, so their sales are pretty high. And, of course, it costs more to have a shirt with a particular player’s name and number on the back. Clubs also have at least one alternative kit in case of clashes, and change the details of their shirts every two or three years.

Nike and so on don’t just make sports gear, but also trainers, jackets, backpacks, etc. More specialist equipment, such as tennis and badminton rackets, is made by companies like Yonex, rather than Adidas et al: maybe there’s not enough profit in them, or perhaps it’s just that there’s free publicity for the company if you appear in public wearing and so advertising a flashy pair of trainers or a football shirt, but you won’t usually be carrying a badminton racket around with you.
Paul Bennett

Editorial: Tinkering will not fix things (2024)

Editorial from the April 2024 issue of the Socialist Standard

Change is needed, urgently. But we need to remember what we are dealing with. The profit system is worldwide. This means that the actions of all national governments are limited by the need for the system to yield profit. No matter what politicians promise, in or out of office, in the end they always have first to look to the needs of the capitalists, the privileged elite who own the means of living.

This doesn’t mean that funding cannot be found for cleaner air, education or subsidised childcare – provided this meets the needs of ‘the economy’. And that it is kept as cheap as possible to avoid scaring ‘the markets’. And any improvements that are achieved will always be threatened when the next slump or recession occurs, as it inevitably will.

Capitalism has solved the technical problem of producing enough to ensure a comfortable standard of living for everyone on the planet. It has brought the world’s population together to cooperate in a massive network of socialised production, by and large organised and operated by the excluded majority, us the workers. The disjoint between this and capitalism’s class basis and profit motive prevents the needs of the world population being properly met and leads to want, waste and war.

The revolutionary change that socialists propose is nothing more than a re-purposing of the global production system. In other words, stop cooperating on behalf of the capitalists and cooperate instead to meet human needs. This presupposes that the means of living are no longer monopolised by a few.

Of course, we’ll still have to mine, grow food, make machinery, and the like. After all, that is the human condition. But working just to meet needs means that we will be able to plan and produce rationally – making everything to the best of our technical ability, with as much regard for the rest of the natural world as is reasonably possible.

It means an end to any form of exchange – what we produce will be available for anyone to use/consume as they wish. This will mean that everything to do with buying and selling will be scrapped. And with no bosses, we’ll all be able to take as big a part as we wish in decision-making. The material conditions for socialist production already exist. Just one thing is missing – class consciousness. Class consciousness is the understanding that capitalism will always work against the economic interests of us as workers. It is the understanding that our class position ensures that we will, inevitably, never get much more than enough to keep ourselves in working order.

It follows from this we should not seek to reform, mend or tinker with capitalism to try to make it work in our interest. Rather should we organise to ditch the profit system once and for all and bring in socialism, the common ownership and democratic control of the means of living as the only basis on which things can be fixed.