Philanthrocapitalism IV: The Messianic Rich (2018)

From the August 2018 issue of the Socialist Standard

Part Three

The concluding article of our series on ‘philanthrocapitalism’

No such thing as a free gift

A significant motive driving philanthrocapitalism has to do with the tax incentives involved in charitable contributions. In most countries in the world, taxes constitute the primary source of government revenue (government borrowing, mainly through the bond market, is another important source). Paying less tax may be good for the businesses concerned but it obviously impacts on government revenue and, hence, the state’s capacity to finance reforms such as social welfare programmes. That in turn has consequences for private charity and the scale of the task it faces.

Some philanthrocapitalists appear to have grasped this point well enough. An example of this is the Boston-based project, Responsible Wealth – a ‘network of business leaders, investors, and inheritors in the richest 5%’ of the US population. It lists amongst its supporters Warren Buffet and Bill Gates Snr and is an offshoot of the aforementioned ‘United for a Fair Economy’ which it describes as ‘an organization that supports workers to organize and advocate for policies that make our economy more fair and equitable’ (www.responsiblewealth.org).

Amongst other things, it calls for higher taxes on the very rich and an increased level of public investment. However, the bizarre spectacle of billionaires taking up apparently left-wing causes might not be all that it seems. There is undoubtedly an element of self-interest involved, based on a recognition that the way things are panning out might not be good for the long-term stability and prosperity of capitalism itself. Though a system of cut-throat competition tends to foster ‘short-termism’, that does not rule out the possibility of sections of the capitalist ruling class rising above their circumstances to take a longer-term perspective.

Given that the state, famously described by Marx as the ‘executive committee of the ruling class’ has more leeway than capitalist corporations in what it is able to do within the context of market constraints, it is not surprising that such a longer-term perspective has tended to be associated with, and organised around, a more statist-oriented prescriptive approach. An example of this would be the kind of thinking that led to the setting up of the modern welfare state.

Germany under its distinctly non-left-wing chancellor, Bismarck, in the late 19th and early 20th centuries, was the first country to truly implement this idea of a welfare state. As Germany began to overtake Great Britain as an industrial power around this time, sections of the British capitalist class, alarmed by this development, began to take a serious interest in Germany’s state welfare programme. They began to see a connection between this and Germany’s growing industrial strength. Years later, in 1943, the millionaire Tory industrialist, Samuel Courtauld, articulated such thinking when he strongly endorsed the Beveridge Report’s proposal to set up a welfare state in Britain too on the grounds that ‘Social security of this nature will be about the most profitable long-term investment the country could make. It will not undermine the morale of the nations’ workers: it will ultimately lead to higher efficiency among them and a lowering of production costs’ (Manchester Guardian, 19 February 1943).

However, there is always that current of short-term thinking, generated by market competition, against which this longer-term perspective has to do constant battle. Economic boom conditions can, to some extent, shore up the latter perspective, by making state welfare programmes more affordable and, also, by empowering workers in their bid to increase the social wage. But when boom turns to bust as it did in the 1970s, ushering in an era of neoliberal austerity, philanthrocapitalism was then able to play a more prominent role, filling the vacuum created by the retreat of the welfare state. Philanthrocapitalism came to be increasingly identified as the bearer and nurturer of this longer-term perspective which the neoliberal state appeared to have abandoned in its bid to cut costs and restore national ‘competitiveness’. Hence the title of Bishop and Green’s book, Philanthrocapitalism: How the Rich can Save the World, referred to earlier. The thinking behind this was that enormous fortunes of the super-rich to some extent cushioned them from the short-term exigencies of cut-throat competition, giving them the freedom to spend their money on whatever they chose

The economics of philanthrocapitalism    

Though philanthrocapitalists may profess to adopt a long-term perspective of wanting to ‘save the world’, their actions all too often belie the image they are intent upon projecting. Take the case of taxes. While some philanthrocapitalists such as those involved in ‘United for a Fair Economy’ seem intent upon advocating higher taxes for people like themselves, this does not apparently prevent them trying to run their own businesses in a manner deliberately designed to avoid paying taxes as far as possible, knowing full well the fiscal impact of this on a state’s budget and on the state’s ability to fund social welfare programmes.

This incongruity might seem puzzling but it is quite predictable in terms of game theory. Our ‘selfless’ philanthrocapitalists are quite willing to pay more taxes providing everyone else – meaning their market rivals – does as well. Until then, they will strenuously seek to avoid paying taxes as far as possible just like their ‘selfish’ counterparts in the capitalist class (who they will also try to emotionally blackmail through such stratagems as the ‘Giving Pledge’ to ensure the costs of philanthropy are shared more evenly). After all, taxation is ultimately a burden on the capitalist class, not the working class, and the squabble over that burden essentially boils down to a conflict of interests and perspectives between different groups of capitalists over how a capitalist economy ought to be administered.

Tax avoidance, unlike tax evasion, is of course perfectly legal under current legislation. The higher the taxes the stronger the incentive to avoid them, since taxation eats into profit margins and impairs the ability of businesses to compete on an increasingly globalised market. The significance of this to philanthrocapitalism lies in the fact that charitable donations are one of the ways in which the payment of taxes can be avoided.

In America, perhaps contrary to impressions, corporate taxes have been historically amongst the highest in the world (although Trump’s recent tax reform bill will cut these to a level just below the global average as well as reducing some personal taxes). Large US-based transnational corporations are particularly adept at tax avoidance, engaging in such sharp practices as transfer pricing and intra-corporate loans, and being able to employ expensive legal terms to ensure everything appears hunky dory and above board. Huge sums of money are offshored into tax havens or reinvested in other foreign operations. As Farok Contractor notes: ‘The accumulated, but unrepatriated, profits of American multinationals’ foreign subsidiaries—which have legally escaped US taxation—are estimated between $2.1 and $3 trillion’ (Rutgers Business Review, Vol. 1, No. 1, pp. 27–43).

As stated, making charitable donations is just another form of tax avoidance. Indeed, some of the most notable philanthrocapitalists are associated with businesses with a notorious record of tax avoidance. One example is Bill Gates. According to a report by The Independent: ‘Microsoft has reportedly avoided up to £100m a year in UK corporation tax by routing its sales through Ireland’ (19 June 2016). Over £8bn of revenues from computers and software bought by customers in the UK has been diverted to Ireland since 2011, under an arrangement agreed with HM Revenue & Customs.

Another example is Mark Zuckerberg. His corporation, Facebook, has been severely criticised for its tax avoidance stratagems and, like Microsoft, has resorted to funnelling profits through Ireland. In 2014, Facebook paid only a paltry £4,327 in corporation tax on an annual profit of £1.9bn (though the company has more recently agreed to pay several millions in taxes).

The case of Zuckerberg and Gates epitomises a trend in philanthrocapitalism. Instead of philanthrocapitalists giving directly to charities, they are increasingly setting up foundations of their own as a vehicle through which they can exercise ‘social entrepreneurship’, funnelling money to causes of their choosing. Some like Buffet seem to be the exception to this trend. In his case, his charitable donations have mainly gone to the Gates Foundation, the largest of its kind in the world, thereby amplifying its already enormous power and reach.

Indeed, the Gates Foundation is said to contribute about 10 percent of the total budget of the World Health Organisation which, critics claim, gives it undue influence on policy making. In a special report, the ‘Global Justice Now’ campaign group comment on the nefarious workings of the Foundation: ‘We argue that this is far from a neutral charitable strategy but instead an ideological commitment to promote neo-liberal economic policies and corporate globalisation. Big business is directly benefiting, in particular in the fields of agriculture and health, as a result of the foundation’s activities, despite evidence to show that business solutions are not the most effective’ (LINK.).

How philanthrocapitalism goes about financing various causes, gives us more clues as to its real nature and intent.

While attention is focussed on the huge sums of money involved in charitable giving, it is easy to overlook what all that money is spent on. Quite a significant chunk of it is spent, in the first instance, on administrative costs and fundraising (which is, of course, indispensable in a capitalist money-based economy). According to a report by the Daily Mail (12 Dec 2015), one in five of the biggest charities in the UK are ‘spending less than half their income on good work’ and, in a few cases, as little as 1 percent.

It is difficult to avoid the conclusion that many of these charities are little more than a lucrative gravy train for those employed in them. Indeed, the New York Times, (29 March, 2008) refers to a report on the fraudulent misuse of charitable money for personal gain in the United States. The authors of this report estimated that the overall costs of fraud came to a staggering $40 billion for 2006, or some 13 percent of the money given to charity in the US. In early 2007, another report by the Center on Philanthropy at Indiana University (partnered by Google) provided some revealing data on the subject of what charitable money is spent on. According to the report, less than one third of the money that the American public gave to non-profit organisations in 2005 was focused on the needs of the economically disadvantaged. Of the total of $250 billion donated that year, less than $78 billion explicitly targeted those in need.

While we tend to think of charity as essentially an endeavour seeking to ease the plight of precisely those in need, this can be quite misleading. Ginia Bellafante in the New York Times (Sept 8, 2012) notes that:

  ‘Nationally, 32 percent of the $298 billion given away last year went to religious institutions, 13 percent to cultural organizations and 12 percent to social services, according to a report issued annually by the American Association of Fundraising Counsel. But if giving were conducted with the greatest consideration paid to the most urgent needs of the society, then Yale, a private institution with a $19.2 billion endowment, would arguably never receive another 50 cents.’

According to a Wikipedia entry on the billionaire Koch brothers: ‘Charles’ and David’s foundations have provided millions of dollars to a variety of organizations, including libertarian and conservative think tanks. Areas of funding include think tanks, political advocacy, climate change scepticism, higher education scholarships, cancer research, arts, and science’ (LINK). That climate change deniers and the advocates of free markets should count as the recipients of philanthrocapitalist charity speaks volumes as to the supposed efficacy of such charity in addressing the needs of the poor. It is precisely the poor of the Global South, above all, who stand to lose most as a result of the very climate change which its deniers are unwittingly enabling.

However, it is arguably when charitable donations are funnelled into for-profit enterprises that the very term itself becomes most particularly questionable. As Matthew Reiz notes in his review of Linsey McGoey’s book, No Such Thing as a Free Gift: The Gates Foundation and the Price of Philanthropy (2015), there is a long-standing tradition of donating money to for–profit businesses in America and it has become more pronounced in recent years. McGoey’s book gives examples of this such as the Gates Foundation’s donations to Scholastic Inc, a large publisher of education material. Another recipient of the Foundation’s money was a project called M‑Pesa, for ‘which Vodafone and its subsidiaries built, in Kenya and then Tanzania, a system that allowed villagers access to mobile phone banking’ (LINK).

As an article in The Economist put it, one of the things revolutionising American philanthropy is the ‘blurring of the distinction between the profit and the non-profit sectors. In health care, and even in education, for-profit companies are increasingly doing things that used to be reserved for non-profits. And non-profits increasingly model themselves on profit-making businesses. Business schools put on courses for voluntary workers. Non-profits hire managers from the private sector, and pay them accordingly. Some non-profits even charge for their services or spin-off profit-making subsidiaries’ (28 May 1998).

Though the sums of money involved in charity donations are substantial – in America for example, by 2016, total giving to charitable organisations had risen to $390.05 billion, 72 percent of this coming from individuals compared with 15 percent by foundations and 5 percent by corporations and the rest by bequests – it is still small by comparison with state expenditures on welfare programmes. In America, if you include both federal and local government spending, the latter comes to about $1 trillion per year. Given that only a fraction of charitable giving in the US (which itself represents only 2.1 percent of GDP) is actually targeted on the needy this further underscores the utter absurdity of such brash claims about the super-rich wanting to ‘save the world’.

Philanthrocapitalism is not about saving the world. It is about saving capitalism through a face-saving attempt to justify what cannot be justified. It is about promoting the patronising belief that the poor depend upon the super-rich when the reality is the complete opposite.

Robin Cox

Exhibition Review: The Sea Is the Limit (2018)

Exhibition Review from the August 2018 issue of the Socialist Standard

With a title that refers to the saying ‘The sky’s the limit’, York Art Gallery is currently running an exhibition dealing with issues of migration, refugees and borders, on until early September. It contains works by a number of artists from various countries, using several types of installation.

The sea can be both a barrier to travel but also a means of escape, and the works on display refer to both these concepts. Nidhal Chamekh (who is from Tunisia) emphasises the barrier aspect with drawings of the refugee camp in Calais, including tents and other self-built shelters. Nick Elwood depicts those who live or lived in this camp, focussing on them as individuals rather than just as part of the influx of migrants that so scares some people. As a reminder of what some people are escaping from, Brian Maguire displays paintings of ruined buildings in Syria, which show graphically the devastation caused there by many years of fighting.

Brian Maguire - Apartments Aleppo 2016

Halil Altındere offers a novel idea of a ‘Journey to Mars’, using a virtual reality headset to show a possible sanctuary for refugees in space: demonstrating perhaps how unrealistic some of the demands of those who want to clamp down on migration are.

It is not a large exhibition but it is a thought-provoking one. In the library at Manchester Metropolitan University is another small but informative display, ‘Oceans Apart’, dealing with transatlantic travel between 1870 and 1940. The direct link to the York exhibition is that of emigrants, many from Ireland, who travelled in crowded conditions in ‘steerage’. At one time such migrants were welcomed as a way of populating the unworked fertile lands of the so-called US cotton states, but later it was claimed that many of them lived in unhealthy conditions in the big cities.

In contrast were the grand tours for the wealthy, on liners run by companies such as Cunard and P&O, advertised on colourful posters, a variety of which are displayed here. The ultra-rich passengers enjoyed suites with their own bathrooms, a far cry from the crowded conditions endured by most travellers.

Paul Bennett

Rear View: The Mainstream Media Matrix (2018)

The Rear View Column from the August 2018 issue of the Socialist Standard

The Mainstream Media Matrix

One of many examples is the BBC – Broadcasting Bourgeois Canards since 1922. Their advertisements want us to believe otherwise, to swallow the lies with little or no question. 'Take away the noise, the fury, the fighting voices, the distortions, cosmetics, the colour and the flashy effects, but most of all, you can take away the lies, the slander, the misrepresentations that seek to pull us apart, and then ... you can find out what is actually happening, and when you find that, then you will find BBC News[peak].'

Stop consuming their canards – take the red pill of socialist understanding instead.

'All that is solid melts into air, all that is holy is profaned, and man is at last compelled to face with sober senses, his real conditions of life, and his relations with his kind' 'He becomes an appendage of the machine, and it is only the most simple, most monotonous, and most easily acquired knack, that is required of him. Hence, the cost of production of a workman is restricted, almost entirely, to the means of subsistence that he requires for his maintenance, and for the propagation of his race' (The Communist Manifesto, 1848).

Campaign for real socialism

'Lookups for socialism spiked on June 27, 2018, following the Democratic primary victory for a congressional seat in New York City by Alexandria Ocasio-Cortez, defeating 10-term incumbent Rep. Joe Crowley' (merriam-webster.com, 27 June). 

But unsurprisingly the same dictionary defines socialism as 'a way of organizing a society in which major industries are owned and controlled by the government rather than by individual people and companies,' and democratic socialism [there is no other kind!] 'is a form of government in which state regulation (without state ownership) would ensure economic growth and a fair distribution of income.' Socialism, as originally used by the followers of Robert Owen, appeared for the first time in their Co-operative Magazine of November 1827 and later made famous by Marx, will be a system of society where production takes place directly for human needs, where money, governments and states do not exist. This is still the only sensible way of understanding socialism, and not the Alice in Wonderland world where words mean whatever anyone says they mean. Ocasio-Cortez is better defined as a social democrat, a term associated with the German politician Eduard Bernstein. He rejected socialism's revolutionary and materialist foundations and advanced the position that it should be grounded in ethical and moral arguments and achieved through gradual legislative reform.   

Not so strange bedfellows 

“There’s no way around it, Socialism and Communism are kissing cousins. The only difference is when this concrete strategy begins to fail, that’s when somebody grabs a gun and Socialism goes to Communism. Socialism really is just diet-Communism,” said Glenn. “Putting ‘democratic’ before Socialist … makes it seem, I dunno, a little less Stalin and more Bernie Sanders” (theblaze.com, 29 June). The spectre haunting the likes of Glenn Beck is not that of socialism or communism but state-capitalism. He and Ocasio-Cortez are clueless. During one of her interviews she at 'first tried to argue there was a significant difference between her beliefs and socialism.' Indeed, but finding herself in a hole she started digging: '. . .  there's a huge difference between socialism and Democratic socialism . . . Democratic socialism, and really what that boils down to me, is the basic belief that I believe that in a moral and wealthy America and a moral and modern America, no person should be too poor to live in this country' (freebeacon.com, 29 June).

Defenders of the status quo

Main stream media, Beck and Ocasio-Cotez support the status quo. They are opposed to the revolutionary nature of socialism (or communism – Engels & Marx used both terms interchangeably). Here the 170-year old Communist Manifesto again remains relevant.

'There are, besides, eternal truths, such as Freedom, Justice, etc, that are common to all states of society. But Communism abolishes eternal truths, it abolishes all religion, and all morality, instead of constituting them on a new basis; it therefore acts in contradiction to all past historical experience. ' 'The Communist revolution is the most radical rupture with traditional property relations; no wonder that its development involves the most radical rupture with traditional ideas.' 'Let the ruling classes tremble at a Communistic revolution. The proletarians have nothing to lose but their chains. They have a world to win. Working men of all countries unite!'

The Trump Circus: Don in Trumpton (2018)

From the August 2018 issue of the Socialist Standard

And he went Trumpety, Trumpety, Trumpety, Trumpety, Trumpety, Trumpety, Trump! Trump! Trump!  The ever predicable Trump was in inimitable trumpeting form during his – almost, but not quite – state visit to the UK.  After a little warm-up trumpeting at the NATO conference in Brussels, demanding European countries increase military spending to 4 percent of GDP - none of that wishy washy 2 percent target of his predecessors – he was in trumpeting hyper-drive by the time Air Force One touched down on British soil, announcing: Theresa you’re fired!  ‘I told her how to negotiate Brexit but she just wouldn’t listen!’  Boris you’re hired!  ‘I think he would make a great prime minister!’  Sadiq Khan you’re fired!  ‘I think he has done a terrible job as London Mayor.’

 Trump came over to the Old Country determined to demonstrate that he was the Supreme Leader and hardly any of our feckless politicians put up a fight.  His torrent of trumpeting generated the usual theatrical outrage amongst commentators and pundits.  But why all the fuss?  Trump was merely affirming the Special Relationship, whereby the UK is America’s poodle, but in more brazen fashion than former US presidents.


The highlights of the buffoonery
 Trump’s trip amounted to a golfing weekend at his beloved luxury resort in Scotland, preceded by the berating of all and sundry in line with his idiosyncratic style of diplomacy: shoot first and ask questions afterwards.

 On arrival Trump flew over London to the sanctuary of the US embassy fortress in Regent’s Park, the helicopter rotors drowning out the chants of protestors on the ground and the giant baby blimp grimacing at him through the porthole window; an organiser of the London demonstration excitedly proclaiming: ‘It’s going to swamp his Twitter feed!’  Revolutionary foment no less, but only of the virtual kind.

 Then on to the reception at Blenheim Palace (but not a Royal Palace of course) with hosts Theresa and investment banker hubby kept waiting ignominiously in the courtyard, looking like a couple of schoolchildren nervously anticipating the arrival of the headmaster to give them a good spanking.  Then on to Sandhurst the following morning to see the US and UK’s Finest in action; to Chequers in the afternoon for what was described as ‘bilateral talks’ – i.e. Trump gives Theresa May another good talking to – followed by a press conference, an opportunity for even more trumpeting; then afternoon tea with the Queen.  Then to Scotland and down to the serious business of golfing, replete with a cordon of 700 Scottish Bobbies to contain a group of 50 placard waving protesters, including an impromptu fly past by a Greenpeace paraglider with banner streaming below displaying the incendiary message: ‘Trump, well below par.’ Early to bed on Sunday evening ready for yet more trumpeting with President Putin on Monday.  And that was that!

 After all the shilly-shallying around – would he, wouldn’t he, should he, shouldn’t he – it was all over in a flash; the millions of words of print and thousands of broadcast hours consigned to the wrappings of a fish and chip supper.  But not before the mainstream media had dutifully spewed their superlatives to bolster the anachronistic spectacle of pomp and pageantry that sought to flatter The Man Who Would Be King; although, given the narcissist that he is, Trump will not forget the snub of the less than Regal welcome.

 Notwithstanding the insipid character of this un-Regal occasion the mainstream media was at its obsequious best in the main, trying to whip the punters into a frenzy of adulation.  This included on the BBC, where the woman commentator was almost orgasmic:  ‘We now have the pictures of The Beast coming up the hill.  Look at that!  The Beast roaring over the horizon!  If you want a projection of power around the world there are few better ways than…’  It wasn’t clear until the end that she was referring to the armour-plated limousine rather than its occupant.

 Amid all the hyperbolic superlatives thrown around like confetti no one seems to have stopped to consider whether this mock aristocratic spectacle is any longer appropriate fodder for the public in the twenty first century.  But what do the media care about such niceties.  They are too busy using Trump as a cash cow, whilst berating him for his buffoonery; salivating like Pavlovian dogs awaiting the next early morning Tweet so that they can splash it around as click bait.  One certain legacy for Trump is that he will have received the most media coverage of any person in history.  Like the wicked witch in the pantomime he might get the most boos, but he also gets the most reviews.  Whilst the media chew over every Trump morsel the man himself is deliriously happy, astride his monopoly board of world proportions, rattling the dice and taunting his opponents that he always throws a double six, with the dice suitably weighted of course.

 His latest wheeze to fix the game is the flatulently named: Fair And Reciprocal Tariff Act (ordinarily referred to by its acronym, the FART Act) which if passed (no pun intended) by Congress will give Trump dictatorial powers to vary any US tariff on any country at will; thus effectively tearing up WTO rules.  The other players in this giant monopoly game could be forgiven for throwing in the towel.  Trump is a man who knows how to play hard ball.  He cut his teeth in the days when he was building Trump Tower in New York, doing deals with the Mafia to secure the huge amount of concrete he needed to erect his phallic symbol.  But those who describe Trump as an imperialist or a Fascist bestow upon him too much of an accolade.  He doesn’t have the intellectual acumen or ideological inclination to be either.  He is just a simple businessman - with all the pejorative connotations that the word entails - and a second rate one at that; albeit one that has some big toys to play with nowadays.


So what does all this Trumpery amount to?
Trump is a racist, a misogynist, a bigot, a sexual predator, a xenophobe, a homophobe, an Islamaphobe, a reprobate and, to cap it all, a birther to boot; with his incessant taunts about Obama’s pedigree.  As the Yanks say: ‘he might be a son of a bitch, but he’s our son of a bitch!’ and that makes all the difference.  Trump is the 45th president of the United States and the Commander-in-Chief of the most powerful nation on Earth, with a multi-trillion dollar arsenal of deadly weapons at his fingertips which he is prepared to lever into any deal to make an offer that can’t be refused.  Trump might yet achieve the ultimate legacy - if anyone is left to write it - as the president who, through nuclear Armageddon and/or climate meltdown, had the most profound impact on the world of any that came before him.  No, Trump should not be written off as an irrelevance.

 Putting these apocalyptic possibilities aside Trump is relevant in other ways too.  In the early days of the presidential campaign the capitalist elite – the bankers, the military industrial complex and other ne’er-do-wells – realised the dangers of a Trump presidency.  Like the drunken slob at a wedding they knew that he could embarrass them by exposing their game; especially when they had wallowed in the luxury of the smooth operating front man, Obama, for the previous eight years; a consummate performer capable of delivering the most bitter pills of capitalism with a sugar coating.  On the other hand Trump, not being one for decorum, will say and do anything to make a fast buck, as will any good capitalist.  But Trump does it with a megaphone.  It is this raw meat characteristic of Trump that has the capacity to inflict damage on the capitalist brand.  

 But as all good entrepreneurs know every problem can be turned into an opportunity.  Ironically, whilst Trump has been busy scapegoating everything in sight to explain away the ills of United States society, the liberal media, egged on by their corporate paymasters, have been moulding Trump into their very own scapegoat by branding him as the ‘unacceptable face of capitalism’ and thus subtlety inculcating the corollary: that there is an ‘acceptable face of capitalism.’  As with all marketing ploys it matters not that it is a fabricated concept, so long as it sells well.  And it seems to be selling like hot cakes, as indicated by the burgeoning movement of anti-Trumpeteers.  Under cover of this flak the ruling class hope to buy time to select, or manufacture, another snake oil salesman like Obama to re-launch the brand.  

 This is not to say that the demonstrators are wrong to protest against Trump.  For some it might be cathartic.  But they should not succumb to the fiction that Trump is the product of some evil gene.  Some of the more discerning commentators are beginning to eschew this genetic interpretation in favour of a more nuanced position.  Owen Jones, of Guardian columnist notoriety and an organiser of the London anti-Trump protests, is the latest to pick up this new baton, imploring us to: ‘don’t just protest against Trump, but protest against Trumpism’, which he loosely characterises as neo-liberal globalisation.  But it’s not Trump or Trumpism, or neo-liberal anything.  The problem is capitalism, pure and simple.  Alternative explanations only lead people down blind allies and encourage them to take their eye off the ball.

 Whether or not the establishment succeed in giving capitalism a temporary facelift its pernicious features are hardwired into the system and its apocalyptic course is set.  Capitalism is incapable of taking into account the need to preserve and nurture the essential live-sustaining elements of our society.  Its destructive force on humanity has been well documented over the years: the enslavement of people in a system of production where the wealth produced by the workers is creamed off by a decadent elite, thus perpetuating an antagonistic mode of existence which impoverishes the human spirit by chaining it to this perverse economic machine.  But it is only in recent years that the full cataclysmic implications have been understood.  Capitalism fetishises money by knowing the price of everything and the value of nothing.  The obliteration of the rainforest, the acidification of the oceans, the pollution of the air, the annihilation of species, the contamination of the soil and all the other destruction unleashed upon the natural environment are euphemistically referred to as ‘external costs;’ that is they don’t appear in the profit and loss account and so, as far as the capitalist is concerned, they are of a no consequence.  The abolition of capitalism is no longer merely socially desirable, it is an ecological necessity.  

 Despite this the death cult of capitalism continues unabated, like a raging bull, oblivious to the destruction it leaves in its wake.  The corporate capture of the faux democracies of the world ensures that our elected representatives shamefully step aside and allow the bull to stampede unhindered.  Like a demented rodeo cowboy Trump is astride The Beast, digging his spurs into its belly and urging it to go ever faster.  And the modern day Roosevelts – the Bernie Sanders and Jeremy Corbyns – who promise to step into the path of the bull to slow it down or deflect its course will find that they are quickly trampled underfoot.


Is Trump good for socialism?
Trump should not be dismissed as a parody, or a caricature, or an aberration.  He is the real McCoy.  He is the manifestation of raw unadulterated capitalism.  But Trump is only a carrier of the disease, he is not the disease itself.  He is the child of the system, not the parent and, in this sense, Trump is a victim like everyone else.  But it is not Trump or Trumpism, or any other contrived representation of our current malaise that ought to be the focus, it is the system of capitalism itself.

 Trump helps the cause of socialism by ripping away the sticking plaster to expose capitalism in all its raw festering septic state.  The capitalist elite is busy trying to put the sticking plaster back.  The task for those who advocate socialism is to dig away at the wound to ensure it remains open and exposed.  This should be made easier by the ever accelerating concentration of wealth amongst a tiny degenerate elite and the relative impoverishment of everyone else.  As Marx argued, unfettered capitalism is potentially a revolutionary force.

 But Trump’s usefulness, in exposing the raw meat of capitalism, is only one side of the coin.  The other side is the opportunity he presents to promote socialism as a positive alternative and to ensure that it comes about before the social and ecological tipping point is reached and before people’s conception of life becomes so muted by the oppressive weight of capitalism that, like the caged hamster on the wheel, they can conceive of nothing else.

 As a species we have the intelligence and the imagination to create a better society, if only we had the will to do so.  Throughout history we have demonstrated our incredible resourcefulness and creativity and, in recent times, capitalism has been a significant driver of such progress, but always at an unacceptable cost to society and, we now know, with catastrophic consequences for the planet itself.

 The alternative cannot be found under such fatuous labels as ‘liberal’ ‘progressive,’ or ‘radical.’  Nor is it going to come about by bandying around lazy slogans such as: ‘real change’, ‘real democracy,’ ‘change we can believe in’ or jingoistic calls to ‘make our country great again!’  Systemic failure requires systemic change and that change is socialism: a class-less, moneyless, borderless, state-less, society where private property is abolished in favour of being held in common for the benefit of all; where power is widely diffused to facilitate participative democracy; where work is an integral and enriching part of life, rather than a necessary chore to sustain it and where everyone can choose the way in which they contribute to the community: from each according to ability, to each according to need.  Under socialism war becomes impossible because there are no nations to wage it and no private property to fight over.  Without nation states and borders the so called ‘migrant problem’ evaporates.  Without money there are no markets, no debt, no poverty, no financial hardship and none of the huge wasteful financial state and corporate apparatus through which the money system is controlled.  Every person has the opportunity to become what they have the potential to be, rather than what the capitalist machine tells them that they are.  This is the positive socialist message which the Trump era can facilitate.  Trump bashing should be a side-show for therapeutic and recreational purposes only.  It should not be the main event.

 What of Trump and the rest of the capitalist class after the socialist transformation?  They will be liberated from their chains like everyone else; free to take up more wholesome pursuits like painting and basket weaving and probably much happier and content for it.  Trump might decide to learn to play the guitar and become a folk singer; in which case he could be welcomed back in his rehabilitated form.  Until then it would be preferable if he stays away.

Tim Hart

Brexit: will it all be a fuss about nothing? (2018)

From the August 2018 issue of the Socialist Standard

‘Iain Duncan Smith: Cabinet’s Brexit proposal is a betrayal of 17.5 million voters who wanted to take back control of their own laws, borders, money and regulations’, was the heading of his article in the Mail Online on 8 July. That’s only his opinion. Actually, 17,410,742 voted ‘Leave’ to the question on the ballot paper ‘Should the United Kingdom remain a member of the European Union or leave the European Union?’ while 16,141,241 vote ‘Remain’. Strictly speaking, then, what there was a majority for, was for the UK to withdraw from the Treaty under which it joined the EU and so from the EU’s decision-making institutions (Commission, Parliament, Court of Justice, etc).

Iain Duncan Smith may have voted Leave because he wanted the British capitalist state to take back formal control of UK ‘laws, borders, money and regulations’. Many others may well have done so too, but others will have voted to withdraw merely from the political side of the EU project. As the Tory MEP, and prominent Leave campaigner, Daniel Hannan noted, one argument used to attract Leave voters was that things had changed since they had voted in the 1975 referendum to confirm staying in: ‘I voted to stay in the common market. No one ever mentioned a political union’ (Spectator, 28 April). It will only have taken 634,751 (half the difference between the Leave and Remain votes plus 1) to have been convinced to vote Leave on this ground and Iain Duncan Smith’s claim that a majority voted for what he wants falls.

Hannan himself is pretty relaxed about just withdrawing from the EU’s political institutions as long as the UK has some scope to do its own trade deals, writing on a Tory discussion forum:

‘A 52-48 outcome pointed to some sort of association that stopped short of membership. Britain would keep most of the economic aspects of the EU while losing most of the political ones . . .  We’d end up very broadly, in an EFTA-type arrangement à la Suisse’ (Conservativehome, 10 May).

We can leave these two high-profile Leavers to slug it out. The Tory party can split over the issue for all we need to care.

People will have voted Leave for all sorts of reasons – to kick out the Poles, to do down the government, because they believed the promises that they’d be better off, to protest against their personal economic plight. Who knows? In the end it doesn’t matter why, since the outcome will depend on jostling between different sections of the capitalist class.

Most of them were in favour of Remain. A minority, mainly financiers who didn’t want their dealings to be regulated by the EU (and who largely financed the Leave campaign), favoured Leave. Perhaps unexpectedly, they won. Ever since, the majority section, and the politicians who represent them, have campaigned and lobbied to limit the damage to their interests. The plan agreed at Chequers on 6 July goes a long way to catering for their interests. It is more or less what Hannan envisaged as a compromise between the two sections of the capitalist class, even if Jacob Rees-Mogg, the cartoon toff – Lord Snooty in the Beano – doesn’t like it. But then, he’s a financier with interests in Hong Kong.

A customised union

A ‘customs union’ is an arrangement between capitalist states under which there is tariff-free trade between them. A ‘single market’ takes this a step further by also removing non-tariff barriers to free trade such as differing technical, safety and environmental standards. This means that trade within the area can be ‘frictionless’ as there is no need for border checks to see if the goods conform to these standards since they are the same in all the participating states. Another way of defining a ‘single market’ would be that it is a customs union with a ‘common rulebook’.

At Chequers the government agreed that the UK should in effect stay in the EU single market for goods (if not services). It is what the manufacturing section of the capitalist class, as represented by the CBI, wanted, even if it won’t be as good for them as now since they won’t have a say, via the government, in drawing up future additions or amendments to the common rulebook.

Trump had a point when he blurted out that this could sink a US-UK trade deal in goods. There would be no point. As he said, the US would deal with the EU as what was agreed with them would apply to the UK as part of the single market:

  ‘If they do a deal like that, we would be dealing with the European Union instead of dealing with the UK, so it will probably kill the deal’ (Sun, 13 July).

He’s not all that badly briefed. The government replied that he hadn’t read the small print, and it is true that the Chequers proposal does come up with a novel way for the UK to be able to do trade deals with non-EU countries, if any are interested. Normally, a customs union (which is what a single market implies) involves a common external tariff against imports into the area. The government is proposing that this should only apply to goods intended for parts of the single market other than the UK. So, as now, the UK would collect the common tariff on these goods entering the UK (and pass the money on to the EU), but not on goods from outside the EU intended for the UK market only.

In theory this might work, but it wouldn’t make a trade deal only with the UK that attractive since the EU market is much larger. Conceivably the US might agree to a deal that would allow chlorinated chickens and GM foods to be imported into the UK but there would have to be some way of preventing these getting into the rest of the single market by, for instance, being smuggled across the Irish land border.

It might work if the EU agrees to go along with it. The EU might if they can get guarantees against smuggling but they can be expected to insist on the Court of Justice having a decisive say in any disputes. And there will have to be a deal rowing back on the free movement of people (incidentally, one of the few benefits of the EU for ordinary people) towards the free movement for employment that was part of the original Treaty.

Services (which are mainly financial) are to be excluded from the common rulebook. This should please those financiers who funded the Leave campaign – they won’t be subjected to EU regulation. On the other hand, less shady financiers won’t be happy as they will be excluded from some trading with the EU. To get round this they will have to move a part of their business from London to Frankfurt or Paris or Dublin but no doubt they will be able to live with this. And maybe they will bargain US access to providing services to the NHS for more access to Wall Street.

One thing that won’t happen is the UK crashing out of the EU with no deal. That would provoke an instant economic crisis that would have global consequences, as well as likely to re-ignite the Irish Republican armed struggle in Northern Ireland. It’s in nobody’s interest. Even those who feign to believe that ‘no deal is better than a bad deal’ don’t really believe this. It’s only bluster to try to strengthen the UK’s negotiating hand.

So, in the end, it looks as if it’s all going to turn out to be a fuss about nothing. Britain will stay in the single market and business will continue as usual. Maybe many of those who voted Leave will feel betrayed but they would also come to feel betrayed, if the hard Brexiteers had their way, when these cynical ambitious politicians failed to deliver on their promises of a better life. They wouldn’t be able to deliver because, no more than a change of government, can a change of trading arrangements make capitalism work in the interest of wage and salary workers and their dependants.

Adam Buick

Competition: a race to where? (2018)

The Wood for the Trees Column from the August 2018 issue of the Socialist Standard

At the time of writing the English Summer is, for once, not merely an oxymoron; it has enabled a multiplicity of sporting delights. Tennis at Wimbledon, cricket at Lord’s, motor racing at Silverstone and (not dependent on English weather) world cup football from Russia. Whilst listening to the England v. Panama football match I overheard the commentators debate something which, unusually, is of interest not just to soccer enthusiasts but to those intrigued by the politics of competition. During the committing of one of the game’s innumerable fouls a commentator wearily concluded that the Panamanian team and its supporters could only interpret any such event through biased eyes; his colleague, however, objected to this stating that he believed most of the fouls were obvious infractions of the rules that anyone with any honesty could see.

In these cynical times it was refreshing, although somewhat naïve, to hear someone articulating the possibility of a level of objectivity overcoming sectarian bias. He may well have been unaware of the political implications of this insofar as it undermines the ‘my country, right or wrong’ ethos of nationalism/patriotism. We might go further and say that competition itself necessarily excludes any kind of objective fairness. If this is the case then it exempts capitalism from any moral or rational concern for justice because it depends on competition from top to bottom. Can there ever exist something we can call ‘fair competition’?

Competition between nation states, corporations, scientific researchers, academics, artists, politicians and even between individuals is endemic to capitalism. We are told that competition breeds excellence when in reality those who proclaim this will do everything in their power to circumvent the rules to get an advantage over their competitors. So what are ‘the rules of the game’?

 Like all forms of competition there is a continual attempt to impose rules that will benefit all those involved by creating a ‘level playing field’. The capitalist class invests heavily in legal frameworks for trade, financial institutions, property ownership and employment but the overriding need to be competitive and thus commercially successful creates a continual tension that often leads to corruption, trade wars, monopolies and militarism; a dangerous contradiction exists between the recognition by the bourgeoisie of themselves as a class with their shared political interests and their need to compete with each other to survive in the cutthroat business environment. The media is full of stories of corporate greed and corruption that focuses on the immoral and illegal acts of individuals (scapegoats) as if, somehow, it is always ‘human nature’ that is to blame rather than the structure of corporate and political institutions. Dialectically we can say that when the quantity of these cases of corruption become so numerous and continual they then become a quality of capitalism itself. 

 Some may object to this cultural understanding of competition by pointing to ‘nature’ and its inherent struggle for survival. It is a favourite manoeuvre of reactionary ideology to attempt to incorporate Darwin’s theory of evolution in its bastardised form of ‘the survival of the fittest’ to justify economic competition. Any such recourse will however serve to prove the opposite of such an assertion because we are a social species and our success is due primarily to our cooperative abilities. Males may compete for the right to procreate in nature but in a human cultural context we know that the ‘successful’ members of our society are far from being the ‘fittest’ either physically or intellectually – just look at the ‘rich list’. Inherited wealth and status are still the predominant elements of ‘success’ within a capitalist context, that or the dumb luck of winning the lottery. Again those who seek to defend capitalism might point to the sporting elite who have had no advantage other than that of a talent honed by competition. Here we return to how we began with a consideration of the relationship between sport, politics and money. 

 Ever since the invention of private property we have had wars over its retention and extension between ruling elites. From ancient civilisations we have evidence of the origin of sports being an arena for practising the arts of war. The original Olympic Games provided an opportunity for both competition between Greek city states and a celebration of a shared culture or ‘Greekness’. The individual athletes would be pampered and admired by their ruling classes because they were representatives of the power of the respective states. The modern Olympiad was also motivated by ideas of the world as a community. Inevitably, like everything left in the hands of capitalism, it has become a celebration of the tribalism of nation states combined with the marketing of consumer goods.

 Today’s elite soccer players are commodities who are occasionally called upon to masquerade as symbols of national pride in contrast (although a good international performance will enhance their value) to their normal existence as money making machines for the football industry. With all of these pressures it is not surprising that any rules are a remote secondary consideration compared with winning.  Once the phrase ‘it’s not cricket’ could be used as a universal condemnation of any rule bending but now even this bastion of gentlemanly behavior has been witness to the sordid phenomenon known as the ‘professional foul’.

 Rules of behaviour (not the logically innate structural and procedural rules) in all areas of human activity are only necessary when pressures exist that create confrontation and potential violence. Competition is one such pressure and that is one of the reasons that socialists believe it should be confined to sports. If identity is dependent on feelings of superiority rather than community we have a recipe for the distress and violence we see around us in capitalism. Another reason is that all of that egotistical infantile energy is so wasteful and counterproductive. If you can imagine a world where competition is confined to the entertainment of sports where its child-like qualities can be embraced with humorous indulgence then you are a long way towards becoming a socialist.

Wez.

Proper Gander: Counter Culture (2018)

The Proper Gander column from the August 2018 issue of the Socialist Standard

 A shop marks the end of the long journey which a pair of socks or a tin of beans has taken to reach us. And the last of the innumerable workers who contributed to getting it to us is often the ‘shopgirl’. Shops and their staff, therefore, have a crucial place in the economy, on the front line of consumerism, as highlighted by the BBC’s Shopgirls: The True Story of Life Behind The Counter.

 This documentary series focuses on how the role of the shopgirl has changed over the decades, and the wider trends behind this. Presenter Pamela Cox, professor of sociology at the University of Essex, tells the story in an engaging, cheery way, linking up personal accounts with the bigger picture.

 Shop work was for men only until the mid nineteenth century, and at least one woman (dubbed a ‘romantic freak’ in the press) twice disguised herself as a bloke to get a job in a shop. The ever-increasing number of mines and factories which were springing up led to an ever-increasing number of stores to sell their products in. This meant more people were needed for the labour market, so the proportion of women employees grew. The widespread assumption that women were more suited to domestic duties put them at a disadvantage when competing for jobs, meaning they ended up in low-status roles, especially in shops. Many shop staff ‘lived in’, meaning their job came with accommodation: usually bleak, strictly-run dormitories. By providing accommodation, employers could both keep and control their staff. Working hours were long, pay was low, and there was constant pressure to perform. ‘The more obsequious and helpful the assistants were, the better you did [as a business]’. Many of their tasks were monotonous and useless, such as winding and unwinding ribbons to give the impression of busyness. Lengthy days without being able to sit down were called ‘the standing evil’, one of many damaging effects on shopgirls’ health detailed in the 1884 report Death And Disease Behind The Counter. Despite the government knowing about the harm which shop work caused, little changed for decades.

 One group aiming to improve conditions was the Co-Operative Women’s Guild, which was founded in 1883 and only closed in 2016. It was set up to provide mutual support, not only for work-related issues, but also with education and welfare. However, many workers were reluctant to organise together, not least because joining a union could lead to getting the sack. Margaret Bondfield was a prominent member of the National Amalgamated Union of Shop Assistants, Warehousemen, and Clerks who campaigned for union membership and also wrote a series of articles exposing the shop worker’s lot. In her later career, she sided fully with the establishment, becoming the first female cabinet minister when she was appointed Minister of Labour in 1929. 

 By the end of the nineteenth century, the rising number of women employed in shops had reached nearly a quarter of a million. In 1909, a branch of Selfridges opened in London, its stylish brand imported from America, along with working practices uncommon in Britain. Selfridges’ shopgirls didn’t live in and were trained to be more confident and less deferential. Grand shops with showy window displays were a visible sign of the growth of commercialism during the twentieth century. Perhaps it was because of this that Suffragettes targeted shops by lobbing bricks through their windows.

During both world wars, men were conscripted and more women joined the labour market to replace them, often taking roles still not considered ‘women’s work’, which in the retail sector meant managerial positions. And when each war ended, men returned to their old jobs and many women returned to the home. 

 By the early ‘50s, three quarters of a million women worked in retail. The way shops were run continued to follow trends which began in America, such as personality-sapping training in ‘customer service’ and the self-service store. The idea that customers would have to go to all the trouble of choosing things from a shelf, dropping them into a basket and actually carrying them to the counter took a while to catch on in Britain. Before self-service, the customer would go to the counter and the shopgirl would encourage them to buy whatever, measure out how much they wanted, and then wrap it up. The packaging on the goods lining the shelves did the same job, starting the shift towards the shopgirl role meaning shelf-stacking and sitting bored behind a till.

 Not so for a shopgirl in a with-it fashion boutique in the ‘60s, though. They were hired to look fab and hang out with the customers, with any hard selling being seriously uncool. But the groovy image of the boutique didn’t convince everyone. In the early ‘70s, feminist magazine Spare Rib published a report on how shopgirls in boutiques were exploited, and the Angry Brigade bombed a branch of Biba, accompanied by a statement that criticised its staff for their uniformity. But it was changing shopping habits which had a greater impact on the boutique’s decline, as they were squeezed out by the growth of department stores and clothing chains. And into the ‘80s, Thatcherite policies like deregulation of planning and employment laws encouraged the shift towards supermarkets and out-of-town malls. 

 The programme crowbars in a mention of Margaret Thatcher’s early years living above a shop in Grantham, which Cox ridiculously claims taught her ‘that the power lay with the customer. She believed in the “right to buy” in the broadest sense, that the customer should have what they wanted when they wanted it’. It’s doubtful that Thatcher had such a naïve view of capitalism, although she probably wanted us plebs to believe it.

 Today, retail workers are the largest group of private sector employees, almost two thirds are women and almost half work part time. Staff today cite pressure to perform, low pay and the stigma of being a shopgirl as problems, as others have in previous times. The efforts of unions, campaigners and reformists haven’t been able to create ideal conditions for shop staff. As the programme shows, wider forces such as the profitability of emerging ways of shopping, and wars, have done more to shape how shop work is carried out. And it’s still changing: now, the role of the shopgirl is being pushed out by the popularity of online shopping and the spread of those annoying self-checkouts.

Mike Foster

Angelica Balabanoff: To Bolshevism and back (2018)

Angelica Balabanoff

From the August 2018 issue of the Socialist Standard

 Anželika Isaakovna Balabanova was born in Černigov, now Černihiv in Ukraine in August, probably around 1868. Her family was wealthy and she had a privileged upbringing. Yet, she soon realised that she did not fit in that type of high-class society and broke with her family, moving to Brussels to attend the Université Nouvelle. There she met leading figures in and around the Second International, such as Élisée Reclus, Émile Vandervelde, and Georgi Plekhanov. 

 In Leipzig, where she moved for a short while, she met Rosa Luxemburg who became her role model for the years to come. Then she moved to Berlin where she attended economics lectures and met various high-level SPD members such as Clara Zetkin and August Bebel. She heard about an Italian professor of philosophy, Antonio Labriola, who was quite well known amongst SPD students; so she decided to move to Rome where she attended Labriola’s lectures and met PSI founders Filippo Turati, Claudio Treves, and Turati’s partner, fellow Jewish Ukrainian, Anna Kuliscioff.

Mussolini

She became a member of the PSI in 1900. The Party asked her to move to Lausanne to educate the Italian immigrants to socialism. Here she met Benito Mussolini. She describes her first encounter with him in her book Traitor: Benito Mussolini and his ‘Conquest' of power. He was destitute. He could not work because he was ‘ill’. ‘I’m good at nothing, not even to earn a piece of bread’, the future Duce told her. He was implicitly asking her help to translate a Kautsky pamphlet from German, in which he was a beginner, to earn some money. Out of pity he was invited here and there to give speeches at socialist conferences for a few francs. As we all know, he turned out to be an effective as well as a bombastic speaker. 

 In Switzerland she also founded Su Compagne (Come on Women Comrades) and she met the Menshevik leaders Martov and Axelrod. She joined in the League of Academic Marxists led by Chicherin, and she met Trotsky in Vienna in 1906. Balabanoff probably met Lenin for the first time in Berne. In 1907, she represented the Russian Academic Students at the 5th Congress of the Russian Social-Democratic Party in London. The same year she also participated in her first meeting of the Second International in Stuttgart. Here she mainly contributed as a translator, and met Karl Liebknecht.

 Together with Giacinto Serrati, future leader of the PSI, she helped Mussolini to leave Switzerland and find a good job in Trieste, a job that he was not able to keep for very long. She gave an interesting account of the day when Mussolini was elected as director of the local magazine Lotta di Classe (Class Struggle). The editor wanted to give up this position and offered it to Mussolini who he thought must be a good socialist considering his father’s politics (he had named his son after a Mexican revolutionary), and because he had no work commitments. The start of Mussolini‘s political fortune is often identified with the role he played at the 1912 Party Congress, when he proposed the motion to expel certain high-level reformists from the Party. Balabanoff tends to minimise his role. According to her, he was of course for their expulsion, but he was nominated to propose the motion to expel them only because he was pushed by the comrades of his region and because of the lack of other volunteers. 

 The victory of the intransigents in the leadership of the PSI pushed reformist Claudio Treves to resign from editing the party organ Avanti! Also in this case Mussolini was offered the job because of the lack of others without work and family commitments. When he was offered this post he was hesitant, and accepted only on condition that Balabanoff joined him. Balabanoff gives an account of Mussolini as being prone to corruption. She broke with him before his betrayal, because of his opportunistic and selfish behavior. Some believed that Balabanoff and Mussolini had a romantic relationship. This does not concern us, but what is sure is that Mussolini’s himself at the peak of his power admitted that without Balabanoff’s help he would have remained nobody. 

Zimmerwald

At the outbreak of WWI in July 1914 she was called urgently to Brussels for a special meeting of the International. She proposed mass strikes against the war, while Viktor Adler and Jules Guesde were against the idea; she was backed only by the Labourists Keir Hardie and John Bruce Glasier. In August she met Plekhanov in Geneva who hoped to see the Italian party push for Italy’s intervention on the British-French-Russian side. In Italy, by now on the verge of intervention, it was hard to be a foreigner. When the German SPD member Albert Südekum visited Italy to push the PSI to convince the masses to intervene on the German-Austrian side, she was attacked as pro-German, although she reminded the crowd that she had been expelled by Austria in 1909 and by Germany earlier in 1914.

 Balabanoff moved to Switzerland. In December 1914 she moved to Berne where she was instrumental in organising the conference of anti-war Social Democrats in Zimmerwald which took place in September 1915. She became a member of the executive bureau composed of the Swiss Social Democrat Grimm, the Italian Maximalist Lazzari and Rakovsky as secretary. The Zimmerwald manifesto, drafted by Trotsky, was the result of the clash of the moderates against Lenin’s Left fraction. The topics discussed at Zimmerwald were the peace action by the proletariat, the position with regards to the Second International, and the transformation of the war into a revolutionary civil war. The moderate view prevailed, thus Zimmerwald stood mainly for peace. It did not officially break with the Second International and did not propose to transform the war into a civil war

Bolshevik

Balabanoff lived in Zurich until the outbreak of the Russian revolution in February 1917. As did other revolutionaries, she left Switzerland to reach Russia on a special train, travelling with Martov, Axelrod and Lunacharsky. She became disillusioned with the February revolution and began to lean toward the Bolsheviks. In this period she saw Trotsky very often. She signed a resolution together with Trotsky, Kamenev and Riazanov for an outright boycott of the Russian Provisional Government. 

She travelled to Stockholm to organise the 3rd conference of the Zimmerwald movement, which took place in September 1917. By now the moderate block was poorly represented and Lenin’s left prevailed. After the 1917 October revolution Lenin asked her to stay in Stockholm to propagate from there news about Russia, providing her with plenty of money to do this. On two occasions the Anti-Bolshevik League tried to assassinate her. In the end she tried to return to Moscow in September 1918, because Lenin had been severely injured by Fanny Kaplan’s attempted assassination. But because of the fighting between White and Red armies at the Finnish border she had to go back to Stockholm. She eventually managed to enter Russia in October. She met Lenin who was still recovering in his country house. 

 She was soon on the go again. In Zurich she was accused of carrying 100 million francs to finance the revolution in Italy. She was expelled from Switzerland, while Italy asked for her extradition to put her in jail there. She, together with other Bolsheviks, was transported to Germany where the November 1918 Revolution was taking place. However, with the victory of the SPD, they were sent to Russia. While in Berlin she was the guest of Adolph Joffe, the Bolshevik ambassador in Germany. She met some members of the Independent Social Democratic Party to convince them to follow the Bolsheviks, with no success.

When the new International, the Comintern, was established Lenin nominated Zinoviev as President and Balabanoff as secretary. Lenin needed her for her international networking. But she found herself doing mere administrative work for the Comintern. She was sent to Ukraine as commissioner of foreign affairs, but in 1920 the Bolsheviks had to flee Ukraine and she returned to Moscow. She had quite some friction with Zinoviev who tried to get rid of her in many ways. 

 In June of that year a delegation from the PSI arrived in Moscow led by Serrati, now its leader. The 2nd Congress of the Comintern was taking place at the same time, at which Lenin laid down the conditions for parties to join; for the Italians this would mean expelling open reformists like Turati. Serrati was against this and Balabanoff leant towards his position. When Lenin asked her to write something against Serrati she refused, telling him ‘I agree more with him than with you’.

 Balabanoff reported another episode of Lenin’s despotism, at the 9th Congress of the Russian Communist Party in 1921. Alexandra Kollontai, a People's Commissar, had criticised the Party for allowing very little autonomy to workers’ organisations; this was enough for Lenin to destroy her publicly. At the beginning of 1921 the peasants rose up against requisitions; many were executed. Kronstadt rose up against Bolshevik rule, leading to the bloody suppression of the local Soviet. These were the last straws that made her decide to leave Russia. Yet she needed Lenin’s permit to do so. 

 While Balabanoff was waiting to leave Russia Clara Zetkin arrived there. Zetkin stayed with her. According to Balabanoff’s account Zetkin seemed quite sensitive to and quite liked the Bolsheviks’ adulations. Zetkin tried to convince Balabanoff to remain in Russia. Balabanoff refused to be a translator at the 3rd Congress of the Comintern in June 1921. In December 1921 she was eventually allowed to leave Russia. From this point on she was an open anti-Bolshevik, though she was officially expelled from the RCP only in 1924. 

Anti-Bolshevik

Lenin had asked her not to leave. She responded that she did not agree with the Bolsheviks’ despotic and demagogic methods. Years later when Trotsky was a refugee in Mexico she wrote to express her sympathy and she reminded him that the same methods of denigration used against him had been used by him against others. He answered: let’s not mention the past; those were different times; let’s not ruin our friendship.

 Balabanoff had seen the Bolsheviks from close quarters and was convinced that without Lenin there would have been no Stalin. She explained that Lenin’s regime and the apparatus he had created allowed creatures like Stalin to develop, with no inhibitions, no brakes; in fact, the climate created by the regime fertilised this and encouraged the immoral tendency of the future dictator.

 After leaving Russia, she stayed in Sweden and then she moved to Austria where Social Democrats like Otto Bauer were in power. Here she wrote for Arbeiter-Zeitung. In 1927 she moved to Paris, called there by the PSI in exile. She moved there, against her inclination, because the PSI lacked an old guard, Serrati having passed to the Communists shortly before his death; Lazzari had also died. At the Congress in January 1928 she was elected secretary of the Party and editor of Avanti! The party also decided to enter an anti-fascist coalition. She was against the United Front because of her anti-bolshevism and did not want to work with reformists or communists. Later, Trotsky wanted her to join his 4th International but she was not interested. 

 In November 1935 she obtained a visa to move to the US, where she got close to the rightwing Social Democrat, Gaetano Salvemini. In 1938 her autobiography My Life as a Rebel was published. In 1941 the Maximalist faction of the PSI ceased to exist and with it the legendary Avanti!

 In 1947 she returned to Italy. Balabanoff was used by Saragat to promote his Workers' Socialist Party of Italy (PSLI), a reformist party which was claiming at that time to continue the legacy of Turati’s 1892 PSI. She was in it because of her anti-bolshevism, but also because she believed that the PSLI was ideologically closer to the Italian reformists of the early 1900s. In 1955 she was invited to the Congress of the ‘Socialist International’ in Vienna where she was acclaimed as a living legend. She spent most of 1957 in Austria and Switzerland. She got close to Golda Meir and was pro-Israel. Finally, in 1960 she settled permanently in Rome. She died on 25 November 1965.

 Balabanoff was the archetype of the revolutionary maximalist Social Democrat. Her Marxism was rather idealistic and lived as a faith. She saw herself as a missionary. Her mission was to convert workers to Marxism. With this in mind, one can understand why she took to heart Mussolini’s case, helping this idle anarcho-syndicalist to become a respected socialist, how she gave in to Lenin’s Bolshevism to pursue the maximal revolutionary goal, and how, at the same time, she defended the integrity of the Second International by means of Zimmerwald. Later in life, she stood for early 20th century Marxist reformism. 

Balabanoff had the merit of exposing from first-hand experience Mussolini (Traitor), and above all Lenin and Bolshevism (Impressions of Lenin) in a period when it was not popular or even allowed. These two works are worth reading and why she is worth remembering.

Cesco

Material World: Co-operatives no way to socialism (2018)

The Material World Column from the August 2018 issue of the Socialist Standard

The International Cooperative Alliance was founded in London on 19 August 1895 by delegates from cooperatives in Argentina, Australia, Belgium, England, Denmark, France, Germany, Holland, India, Italy, Switzerland, Serbia, and the USA. Co-operatives Unleashed  is a recent report from the New Economics Foundation which calls for a co-operative development agency and a 'John Lewis law' compelling larger private companies to transfer a proportion of profits into a worker or a wider stakeholder-owned trust. In the report is a call for a 'profound transformation in business ownership'. 

Under this proposal:

   'All shareholder or larger privately-owned businesses would transfer a small amount of profit each year in the form of equity into a worker or wider stakeholder-owned trust. Once there, these shares would not be available for further sale. 'Partnership stakes carry with them democratic control rights over the management and direction of the business. In many respects, our proposal for an Inclusive Ownership Fund can be thought of as a John Lewis law.'

Our fellow-workers should, rather, face up to the reality that socialism is the only remedy for the poverty problem yet too many seek merely to ameliorate the misery of their lives under capitalism and one such palliative that continues to persist is cooperatives. Some have viewed the cooperative as an aim in itself, as a means of self-defence against management repression. Our job in the Socialist Party is not to tell fellow-workers the way to live, but to demonstrate that a genuine non-capitalist society is actually possible to achieve. 

 We do not see socialism coming about by 'socialistic' cooperatives gradually becoming more and more self-sufficient and eventually squeezing out the entire capitalist production-for-profit system. This argument goes right back to the origins of the workers' movement in the first part of the 19th century. 

 However, the our view is that political action for social change is the most effective way to achieve a co-operative commonwealth. We are not saying that people shouldn’t establish cooperatives if they want to, but that it’s not the way socialism is going to come.

We can imagine that, when socialists are in the millions rather than thousands and it is clear that socialism is imminent, people will be making plans and projects in anticipation of the coming of socialism, but we are not there yet. Cooperatives by themselves are insufficient to challenge the capitalist system. 

 So at the moment, we need to concentrate on spreading socialist ideas rather than promoting experiments in lifestyles.

While many cooperatives’ administrative structures are admirable, in the marketplace they become simply another kind of small enterprise operating in their own interests, competing with other enterprises and even with other cooperatives and which are obliged to conform to marketplace dictates, regardless of the intentions of their advocates and founders. 

 As long as capitalism exists, competition will always require the enterprises within it to look for lower costs, including the cost of labour. A cooperative must still buy its raw materials and other inputs and sell its products on the market, competing with every other producer of the same product, even if the members of cooperatives are nominally their own bosses. There cannot be socialism in one country, much less in a single business or a chain. Cooperatives cannot break the laws of capitalist production. The most important such law compels an enterprise, whoever owns or 'controls' it, to minimise costs in order to remain competitive. Society remains under the despotic direction of capital – even if it is the workers’ themselves rather than CEOs who serve as the new 'personifications of capital'.

 Although Marx mentioned workers’ cooperatives as possible harbingers of the new society, he cautioned that, as long as they exist within capitalism, the cooperatives 'naturally reproduce in all cases… all the defects of the existing system, and must reproduce them… the opposition between capital and labour is abolished here… only in the form that the workers in association become their own capitalist.' In other words, the workers end up exploiting themselves. When Marx turns to socialist society, he envisions a sweeping revolutionary transformation of the relations of production, from the very start. Although cooperation of some sort is a necessary part of production cooperatives by themselves are insufficient to challenge the capitalist system.

ALJO