Voice From The Back: Profits And Oily Words (2006)

The Voice From The Back Column from the December 2006 issue of the Socialist Standard

Profits And Oily Words

You have seen advertisements by oil companies that express concern for the environment and claim they fight global warming. It is of course a fraud. “Britain’s leading scientists have challenged the US oil company Exxon-Mobil to stop funding groups that attempt to undermine the scientific consensus on climate change. In an unprecedented step, the Royal Society, Britain premier scientific academy, has written to the oil giant to demand that the company withdraws support for dozens of groups that have “misrepresented the science of climate change by outright denial of the evidence.” (Guardian, 20 September) Capitalists are only interested in profits, they don’t give a damn about your children or their children’s future. That is capitalism.

A Toxic Society

The World Health Organisation (WHO) estimate at least 90,000 people die every year of asbestos related diseases but that didn’t stop the manufacture of the obnoxious material. “Chrysotile asbestos, a known human carcinogen, will remain off a global “watch list” of toxic substances for at least two more years after countries led by Canada blocked consensus in United Nations talks on Friday. … Canada, whose French-speaking Quebec province is a major asbestos producer and exporter, led opposition to its addition to the list, according to environmentalists tracking the talks. Canadian officials say puting chrysotile asbestos on the list would be tantamount to banning international trade in it and threaten jobs.” (Yahoo! News, 13 October) 90,000 deaths a year is a mere inconvenience compared to a couple of bucks for the owning class who make their money from death and disease. That is why we are socialists, also some of us once worked in shipyards, where they used asbestos, and we have difficulty breathing.

Cut Price Killers

“BP, the British oil group, had a “check-book mentality” towards safety and was aware of maintenance backlogs and unsafe equipment at its Texas City refinery years before the fire there in 2005 in which 15 workers died, according to findings from US safety officials. .. Safety was compromised by a succession of budget cuts … The company implemented a 25 per cut on fixed costs between 1998 and 2000 which adversely affected maintenance expenditure at the refinery.” (Times, 31 October) In order to compete inside capitalism firms are constantly trying to cut overheads. In this case leading to the death and injury of many workers. That is how capitalism operates. Nasty aint it?

Gangster Talk

The recent electoral losses of the Republican Party in the USA have led to the Defence Secretary Donald Rumsfeld quitting his post. His political demise led to newspapers running articles on him. Here are a couple of his past statements that were quoted. “Death has a tendency to encourage a depressing view of war” and “You get a lot more with a kind word and a gun than you do with a kind word alone.” (Times, 9 November) It is significant that this last statement of Runsfeld was a quote from the gangster Al Capone. We can understand why a US Defence Secretary would have admired a murderous gangster chief, after all they both lived in a capitalist society based on violence.

Bull In A China Shop

The media mogul Rupert Murdoch has been making strenous efforts to break in to the Chinese market, but in 1993 he made a mess of it by stating, “Advances in the technology of telecommunications are an unambiguous threat to totalitarian regimes everywhere.” The Chinese took this threat seriously and imposed strict rules on satellite dishes thus depriving Murdoch’s Star TV of the huge Chinese's potential audience. “The following year Star removed BBC World Television from its Chinese service, in a move that was regarded by many as a sop to the Chinese government.” (Observer, 12 November) Last month Murdoch was in China trying to sweet talk his way in with government officials. When it comes to making money democratic views take a back seat with capitalists like Murdoch. What is suppression of political ideas, imprisonment, torture and death compared with more money to a billionaire? Very little it seems.

An American Myth

Supporters of the profit system often site the USA as a good example of how democratic capitalism really is. They give us the old homily about “log cabin to White House” although today it should probably be “trailer park to White House”. It is of course a complete fallacy as the following item about the recent mid-term election illustrates. “This election proved that it pays to spend big(ger). The average House winner burned through about $1 million on the stump – and the candidate who spent the most won in 93% of House races. The most expensive victory was, oddly, one of the Dems’ safe bets: New York Senator Hillary Clinton, who won a second term with 67% of the vote – and $35.9 million.” (Time, 20 November) Forget the myths, for a lot of Americans it is “trailer park to trailer park”.

Archetypal Fat Cats (2004)

Book Review from the September 2004 issue of the Socialist Standard

Bad Company: The Strange Cult of the CEO by Gideon Haigh. Aurum £6.99

They used to be called something like ‘general manager’, but nowadays the main term for the head of a big capitalist company is ‘chief executive officer’. While they are nominally salaried employees, their pay as archetypal fat cats is so high that they are in fact clearly members of the capitalist class.

It was the growth of limited liability from the early nineteenth century that gave rise to the modern capitalist corporation and hence to the CEO Firms were originally run by their founders (or their heirs), but the owners faced the debtors’ prison if they went bankrupt. So few would buy shares in a company unless they could be personally involved in supervising how it was run. Limited liability meant that shareholders were no longer personally liable for any misdeeds or bankruptcies, so owners could delegate day-to-day control to a salaried manager, with a board of directors overseeing the whole thing.

As the title of this short volume suggests, the CEO has become a kind of cult figure, with in many cases a celebrity status and a pay packet to match (averaging over $30 million a year in large US companies in 2002, for instance). Many CEOs work long hours, apparently, though of course a lot of this time is spent in luxury hotels and swanky restaurants, and they are seemingly surprised when their employees fail to share their taste for sixty-hour weeks. Their income is reinforced by the curious idea of a ‘guaranteed bonus’, and of a ‘golden parachute’, paid to them if they are sacked by the board of directors.

And what does a CEO do in return for this generous remuneration? It’s clear that they do not in any real sense run the company, since big corporations are far too complicated to be managed by individuals. Rather, they concern themselves with the company as a business, often having little detailed idea about what it actually produces, and give orders that others have to implement. The impression gained from Haigh’s book is that if the share price keeps rising, irrespective of any medium- or long-term benefits to the company, then shareholders and directors are happy. Reducing costs by cutting staff is a favourite, and none too sophisticated, approach.

With golden parachute in pocket, a number of CEOs go into politics - President Bush’s cabinet, for instance, is full of them, from Dick Cheney to Donald Rumsfeld. As Haigh quips, “the Bush administration is more a CEOcracy than a theocracy.” The extent of this cosying-up is fairly new, but governments do not have to be full of ex-businessmen in order to serve capitalist interests.

Haigh makes the useful point that, while workers are urged to keep wage demands in check so that they can compete with other workers (especially those in other countries), CEOs instead always want to be paid more so as to be in line with their counterparts overseas — the idea of ‘internationally competitive’ has different meanings for bosses than for workers. While he is well aware of the absurdities of CEO pay, he has some odd ideas about the way capitalism works. For instance, he claims that “Companies do not exist to make profits; they make profits in order to exist” He seems to think this is an important correction to a common myth, but in whichever version it just means that companies are motivated by profit-making. Nevertheless, his book does give a useful picture of what CEOs do and don’t do, and of why we have no need of them and their fellow-exploiters.

Paul Bennett

Voice From The Back: Pawn move (2003)

The Voice From The Back column from the April 2003 issue of the Socialist Standard

Pawn move

We are constantly being told what a wonderful society modern capitalism is and how it has solved the problems of poverty that used to occur in the “bad old days”. So what have me to make of the following information in the Business Section of the Times (18 February)? “With many banks suffering from rising bad debts and margin pressures, pawnbrokers have emerged as one of the few sectors of the finance industry expected to see strong growth in 2003. Experts yesterday predicted that Britain's pawnbroking industry would expand as much as 15 per cent this year to achieve record turnover of more than £85 million, almost triple the amount seen five years ago . . .The business is not helped, it says, by its perception as a “Dickensian institution” and the existence of annual interest rates of more than 100 percent.” Despite two Labour governments it seems that some of us have still got to go down to the pawn. We know how you feel. Sometimes we get skint.

Crawling to work

When Chelsea Clinton, daughter of the ex-president, was offered a job at McKinsey management consultants, starting at £40,000 a year, The Guardian ran a feature on this long established firm. It revealed some of the slavish attitudes that capitalism engenders. “Among things that McKinsey stands for is consistency of presentation. Until the early 1960s, that meant all McKinsey men were expected to wear hats because their chief executive clients did so. When one executive realised that fashion had changed and turned up for work bare-headed one day, colleagues reacted warily. “Should we all give up our hats?” asked one. “I'd wait six weeks,” a partner replied. “It may be a trap.” The Guardian (21 February) It is easy to sneer our critics may say. We reply how many arses would you lick for 40 grand a year?

There be dragons

“A panel of Church of Scotland ministers and psychiatrists has been formed to revisit the controversial area of exorcism for the first time in 15 years. It follows concerns the Church is not doing enough for people some believe have been possessed by devils.” The Herald (4 March) In their leaflet “Dealing With Darkness” the church claims that signs of this demonic possession can be “revulsion from Christian ideas”. It seems more likely to us that this revulsion could spring from christianity's awful record of torture, sexual suppression, misery and mumbo-jumbo like exorcism.

Another Great Man speaks

As if to prove that the US President isn't the only one of the US capitalist's representatives to speak in a less than lucid fashion. Donald Rumsfield, the US Secretary of Defence has come up with a couple of gems to rival his boss. When asked why such heavy bombs were being used in Afghanistan he uttered this profundity. “They are being used on frontline al-Qaeda and Taleban troops to try and kill them.” And when asked about Bin Laden, “We do know of a certain knowledge that Bin Laden is in Afghanistan. Or in another country. Or dead.” The Times (13 March) Bombs being used to kill people? Bin Laden is either alive or dead? Its good to know that such sages are in charge, isn't it?

T-shirts of mass destruction

That war hysteria breeds irrational behaviour is surely proven by the case of Stephen Downs, who was arrested and charged with trespassing at a New York mall. His crime? He was wearing a T-shirt that said Peace on Earth and Give Peace a Chance. “I was confronted by two security guards and ordered to either take off the T-shirt or leave the mall”, said Stephen Downs. Newsweek(17 March) What such guardians of New York malls will make of our comrades in Canada who have been distributing for some years T-shirts proclaiming “Abolish the wages system” is left to your imagination.

A fishy tale

Members of the world socialist movement base their ideas on science. So of course we were extremely interested in the way-out happenings that recently occurred in New York .”According to two fish-cutters at the New Square Fish Market, the carp was about to be slaughtered and made into gefilte for Sabbath dinner when it suddenly began shouting apocalyptic warnings in Hebrew.” The Observer (16 March) “Many of the 7,000 Skver sect of hasidim in New Square, 30 miles north of Manhattan, believe God has revealed himself in fish form.” Next time you buy fish and chips listen to the God instead of eating the cod. What a load of nonsense. All religious ideas are.