Paying for the NHS
I had understood that the SPGB argued that taxes are ultimately paid by the capitalist class out of surplus-value and that net wages received by workers represent the value of their labour-power (assuming that commodities exchange at their value). However in the August Socialist Standard we are told (Leigh Burr-Parti) that with the coming of the National Health Service workers should expect that in the long run their wages would adjust by being lower than if there were no NHS. This implies that the NHS (and the rest of the welfare state) is “financed” by the workers out of wages, i.e. that it is paid for out of variable capital not out of surplus-value.
Of course all value is produced by the working class and in this sense the working class “pays” for the welfare state. But this is not just a theoretical issue. If the welfare state is financed out of surplus value then presumably it is in workers’ interests to increase welfare provisions, as this would represent a clear increase in their material wellbeing, i.e. in addition to receiving the value of their labour-power they would also manage to get back some of the surplus-value appropriated by the capitalist class. However, if as Leigh Burr-Parti suggests it is financed out of variable capital the working class as a whole is no better off whether health, education etc. is provided by the state or through the market.
This of course is not to deny that whichever way one looks at it the real issue facing workers is the establishment of Socialism where there will be no exploitation of one class by another, and not that of trying to patch up capitalism via the welfare state.
(Ms.) V. M. Brown
London NW6
Reply:
As you say, taxation is a burden on the capitalist class not the working class; and wages are what is received, not a hypothetical gross payment. Though the amounts put down as insurance contributions are not received by workers these amounts are, over-all, returned to them as benefits. Their nature therefore is a portion of wages held back as a special fund. If this regulated reduction were not made, workers’ subsistence would have to include their purchase of medical services and the other needs covered by benefits.
But see how this would work out. Three workers A, B and C receive a total of £6 a week in benefits over a period. A and B are both married; A has children, B has none; and C is unmarried. Obviously A’s are the biggest needs. Conjecturally his share of the £6 may be £4, B’s share £1.50, and C’s 50p. If these needs had to be met by additions to wages instead of a planned deduction, the strength of the wage demand would be A’s requirements: that is, another £4 a week for all three. Instead, all three are dealt with at £2 each week. It may appear that A gains, at least, but of course each is in the others’ position at other times. However, at any given time only a minority of workers are in the full “breadwinner” position on which wages are based, and the contributions scheme is therefore greatly advantageous to the capitalist class.
We may add that this is not an interpretation of our own but was part of the argument of the Beveridge national insurance scheme when it was put forward in 1942. The same can be said of welfare benefits as a whole—income supplements, family allowances, rent rebates etc.: that they select recipients and avoid giving more wages to workers generally. A statement about the effectiveness of the scheme was made by the former Labour minister R. H. S. Crossman in the Daily Mirror on 15th November 1955:
The fact is that since 1945 the British trade unionists could have enjoyed a far higher wage packet . . . Instead of doing so, however, they exercised extreme wage restraint. This they justified by pointing out to the worker the benefits he enjoyed under the Welfare State—food prices kept artificially low by food subsidies; rents kept artificially low by housing subsidies; rent restriction, and. in addition, the Health Service.
You suggest that workers could increase their share of the social product by demanding and getting more benefits. If these come from the insurance fund, the result would only be an increase in “contributions”. If they were medical and educational services provided out of general taxation, it would mean an increase in government expenditure which has other consequences; and the demand would then commit workers who made it to supporting the party which promised the biggest slice of cake—a familiar position.
Editors.
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