Cooking the Books: Prisoners of the market (2026)

The Cooking the Books column from the October 2026 issue of the Socialist Standard

‘Mounting costs are damaging business investment and undermine the government’s attempts to raise living standards, the CBI has warned’, wrote the Times (9 September), reporting on a document prepared by the employers’ association for the Budget. The CBI’s chief executive, Rain Newton-Smith, argued that:

‘When firms are forced to absorb higher taxes, energy bills, and regulatory costs, the consequences are weaker investment, job losses and less scope to raise wages’.

Employers are always complaining of increased costs due to taxes and stricter regulation, but there is more than a grain of truth in their argument.

‘Absorb’ is a delicate way of saying that, as they can’t pass on the extra costs by raising their prices, their profits have to take a hit. So what Newton-Smith is really saying is: ‘when firms make lower profits due to higher taxes …’ Reduced profits could indeed lead to ‘weaker investment’ (but they could also mean lower dividends for shareholders). Insofar as they do, that does weaken investment. So there is less economic growth. Which, as Newton-Smith pointed out, would undermine the government’s strategy of relying on growth to bring it a bigger tax revenue and so allow it to improve people’s living standard by spending more on education, health, housing and the like.

Irrespective of whether on this occasion the employers are bluffing in order to extract concessions from the government, there is the question of the wider relationship between government and private employers.  The American political scientist, Charles Lindblom, wrote an article in 1982 called ‘The Market as Prison’ in which he argued that, in an economy in which production was in the hands of profit-seeking private enterprises, government decisions were tied to the success of these enterprises. Not only that. If the government didn’t respect this — if it didn’t allow enterprises to make the profits they expected — it would be automatically ‘punished’ by the operation of the market.

His argument went like this: If a government raises taxes too much or imposes too many regulations, companies cut back on investment. This leads to job losses and financial crises. Voters blame the government for this, not the business owners. The government loses the next election. The politicians responsible are punished.

As Lindblom remarked in an earlier book:

‘To understand the peculiar character of politics in market-oriented systems requires, however, no conspiracy theory of politics, no theory of common social origins uniting government and business officials, no crude allegation of a power elite established by clandestine forces. Business simply needs inducements, hence a privileged position in government and politics, if it is to do its job’ (Politics and Markets, p.175).

The market works, he suggested, like an invisible prison in that it limits how far governments can go with social reforms that threaten profits that are business’s ‘inducement’. Anything radical is ruled out. It makes politicians afraid to challenge the ‘privileged position’ of the private sector. They tone down their proposals so as not to scare the market.

A recent example is Burnham’s choice not to appoint Miliband as Chancellor because business perceived him as somehow anti-business. Other examples are Starmer and Reeves’s pre-election statements about Labour being ‘the party of business’ and Burnham’s that his ‘socialism’ is of the ‘business-friendly’ variety.

Politicians in office must help business in its pursuit of profits and certainly not do anything to hamper it. They must serve the interest of business owners.

Cooking the Books: The Labour Party Marxist? Pull the other one! (2020)

The Cooking the Books column from the January 2020 issue of the Socialist Standard

The Sun (5 December) denounced the prospect of ‘a Marxist-run coalition with Corbyn in No 10.’ This strange view that the Labour Party under Corbyn is Marxist had been repeated for months by Tory politicians. A headline in the Daily Express (30 March) proclaimed ‘Iain Duncan Smith issues warning over “Marxist threat” from Jeremy Corbyn premiership,’ while in July, in his bid to become Tory leader, Boris Johnson spoke of Corbyn as ‘the leader of a cabal of superannuated Marxists.’

This claim goes even further back, to Prime Minister’s Question Time in 2013, when according to a Daily Mail headline (9 October 2013) ‘Miliband wants to live in a ‘Marxist universe’, Cameron claims as leaders clash over Labour ‘gimmick’ to freeze energy bills’, while ‘Chancellor George Osborne claimed that the Labour leader had put forward the same argument that “Karl Marx made in Das Kapital”’. Cameron’s case was that Marxists want to control prices while world market prices are beyond the control of governments; which, ironically, is the Marxist view.

But what is a ‘Marxist’? Marx himself didn’t like the term and would have preferred his theories to have been called ‘communist theory.’ Nevertheless, after his death, ‘Marxism’ came to be the term used even by those who agreed with his views to describe the body of his theory: the materialist conception of history, with technology and class struggles as the driving forces; his analysis of the economic workings of capitalism as a system of uncontrollable capital accumulation in fits and starts; and his insistence on the need for the working class to win control of political power in order to establish a communist (or, the same thing, a socialist) society based on the common ownership of productive resources and production to directly meet people’s needs rather than for sale with a view to profit.

The Labour Party falls at the first hurdle. It does not stand for socialism as Marx did, even though at times it has claimed to be socialist. The first time it did this was in 1918. Before that, it saw itself as merely a trade union pressure group in parliament. But what it called socialism was nationalisation, or production for profit organised by state enterprises, the correct term for which is ‘state capitalism’.

The present Labour Party has abandoned even this, accepting that the commanding heights of the economy should be in the hands of profit-seeking private enterprises. It talks now of an ‘entrepreneurial state,’ which is just another form of state capitalism.

The Labour Party has never understood how the capitalist economy works. It has never accepted Marxian economics, preferring Keynes who taught that capitalism can be controlled by state intervention and made to work in everybody’s interest.

A previous Labour Party general secretary, Morgan Phillips, famously said that ‘the Labour Party owes more to Methodism than to Marxism’, which is true. Its philosophy, insofar as it has one, is do-goodism rather than Marx’s view ‘the emancipation of the working class has to be the work of the working class itself.’

One more intelligent Tory, Robert Halfon, newly re-elected MP for Harlow, warned them to ‘stop calling Corbyn a Marxist’ as ‘such terminology means very little to most ordinary folk’. It doesn’t, but there might be an upside to this – more people seeking to find out what it does mean.

Greasy Pole: Contrickery in Conference (2012)

The Greasy Pole Column from the November 2012 issue of the Socialist Standard

Locked, bolted and barred with every spoken syllable and gesture weighed and scrutinised, the annual conferences of the big political parties are not what they used to be. There was a time when the attending members, taking pride in themselves as delegates, could have hoped that their agenda items, after being amended, composited and generally sanitised, might have borne some relation to the professed policy of their party, or when events scheduled as debates might have aroused some passion or indignation about world famine or dictatorships or devastating war. It is not like that now: “Borderline tedium” was how one observer put it.

This year Conservative Party members might have travelled home from their conference in a glow of satisfaction, under the impression that their doubts about the government had been noticed. As when Cameron defiantly laid it down that no one should feel bad about having been to Eton: “I say yes I went to a great school and I want every child to have a great education. I’m not here to defend privilege. I’m here to spread it”. Except that privilege is nothing if not exclusive – as comprehensive pupils will realise if they ever have to play in their school’s version of the Eton Wall Game. As when the new Justice Minister, Christopher Grayling, thumped his tub to announce the replacement of Ken Clarke’s Rehabilitation Revolution by Rougher Retribution. As when Eric Pickles paraded his plans to obstruct the union activities of local authority workers on the grounds that this will make the unions stronger.

Clumsy Clegg

The LibDems no longer alert us about global warming or the dangers of eating non-organic food, which, to anyone interested in political matters, was only mildly irritating. Now they are preoccupied with their agonised wrestling to keep their place on the same side of the Commons as Cameron’s Tories while plugging the gaps left by those infamously dishonoured election pledges. Their method has been to placate the outraged voters while avoiding the question of why any of their future promises should be believed. This wretched come-down dominated their conference, not alleviated by Nick Clegg and his fumbling efforts to divert attention from their exposure: “There is a better, more meaningful future waiting for us. Not as a third party, but as one of the parties of government… Stop looking in the rear-view mirror as we journey from the party of opposition that we were, to the party of government we are becoming”.

False Images

But those images in Clegg’s rear-view mirror could not have inspired the LibDems as examples for the future. Such as: “I see generations of Liberals marching towards the sound of gunfire” – a phrase first offered by the charmingly mannered Old Etonian, Jo Grimond, their leader from November 1956 to January 1967. Under Grimond the Liberals were on the rise, for example, winning the safe Tory seat of Orpington in 1958 but then declined. In July 1976 David Steel took over, offering the party some hope with his livelier style, and for a while this seemed to bear fruit, but in March 1977 Steel stuffed them into an uncomfortable alliance with Callaghan’s Labour government, and when this failed to keep Labour in power in 1988 he managed the merger with the discredited Gang of Four’s SDP. However, there was persistent enmity between Steel and the SDP’s leader David Owen, a symptom of which was Steel agreeing to a joint policy document without having read it. This year a triumphant Clegg told the conference that Paddy Ashdown will head the party’s general election team – the same Paddy Ashdown whose failure to improve the party’s prospects came to an end with his resignation in 1999. None of these men in the rear-view mirror succeeded in raising the Liberals to the point when they could be seen as an alternative government for British capitalism. When Clegg proclaimed to the conference that the LibDems stand for “a fair, free and open society,” he was offering just another pledge, to be judged by the party’s dismal history of failure.

Vote for Disraeli?

When it was time for Ed Miliband to stand at the rostrum he knew – because almost the entire British media had blanketed him with the advice – that this was his make or break time. He slaved at learning his lines off by heart so that as he boarded the train to Birmingham he was as word perfect as any Old Vic veteran. Although an eavesdropping fellow passenger heard him spurting in frustration “What am I doing? Who knows what I’m doing? Where’s my fucking diary?” he came through to make a speech arousing the massive satisfaction of party members and the media – which can be explained only by reference to their impoverished standards of expectation. Plunging into typical politicians’ gobbledygook, Miliband referred (no less than 44 times) to the concept of One-Nation, with an implied salute to Benjamin Disraeli whose name is forever linked to the phrase – which was also used by Tony Blair in Labour’s election winning 1997 manifesto: “I want a Britain that is one nation, with shared values and purpose…”  At a time of recession, with the promise of even fiercer pressure on our living standards, the best Miliband and his party can do is urge us to have regard to the words of a Victorian politician (whose concern for the effects of the class divide and its resultant problems did not endure into what might be called history) and of a recent leader with the reputation of a blatant liar. Meanwhile in the real world, the British Medical Journal, supported by the Samaritans, reports that as unemployment increases so does the rate of suicide.

Vacant Posturing

The Tories went to their conference this year desperate to hear that George Osborne and his magicians at the Treasury will soon have dissolved the recession into history. In a characteristically empty speech David Cameron was able to feed their appetite. For the LibDems Nick Clegg could do little more than console them for the angry likelihood of approaching doom and his own banishment to bitter memory. Ed Miliband showed that he has finally grasped the need for any aspirant political leader to compose a speech consisting of headlines and vacant posturing. None of them could suggest that for human society there should be something other, better or more hopeful. The case for us doing it for ourselves, for changing the way we order the world so that it is to the betterment of humans, remained intact and unchallenged.

Ivan

Unions Should End the Link With Labour (2013)

From the August 2013 issue of the Socialist Standard

In a bid to stop the Tories and the media painting Labour as a ‘class-based anti-cuts party’ (which planet are they living on?) Ed Miliband has proposed to weaken the links between Labour and the unions. This has been long overdue, but from a trade union point of view.

Trade unions were originally set up by groups of workers to bargain collectively, as a single unit, with their employer over their wages and working conditions. Today, it is true, they have become bureaucratic organisations run by highly-paid full-timers but workers are still better off with them than without them. They do provide some protection against arbitrary acts by employers and they are able to push up wages in a boom and stop them falling too far in a slump. Everyone should join one. They are the only protection workers have under capitalism.

Trade union consciousness

Some early trade unionists realised that trade union action was not enough and that workers needed to take political action too, if only to press for legislation to protect them at work through health and safety laws or to provide them with some income when out of work, whether through not being able to find a job or through sickness, industrial injury or old age.

Lenin, writing about the same time, defined ‘trade union consciousness’ as ‘the conviction that it is necessary to combine in unions, fight the employers, and strive to compel the government to pass necessary labour legislation, etc’, adding ‘trade-unionism does not exclude ‘politics’ altogether, as some imagine.’ Despite his mistaken view that on their own workers were limited to reaching only this and not a socialist understanding, this is quite a good definition. Its expression in Britain was the Labour Party.

Following some adverse court judgements, the TUC decided in 1900 to sponsor trade union candidates for parliament at the general election of 1906. When some of these were elected they formed the Labour Party. Up until 1918 that was all the Labour Party was – a pressure group of union-sponsored MPs. It was overwhelmingly financed by a political levy which members of affiliated unions automatically paid with their dues unless they specifically ‘contracted out’.

In 1918 the Labour Party decided to transform itself into a full political party, but still linked to the unions, to rival the Tories and Liberals as a potential party of government. In other words, as a party prepared to take on the task of administering the capitalist state within the context of the capitalist production-for-profit economy.

We pointed out at the time that, since capitalism was a profit-making system that could work only in the interests of those who lived off profits, running its state would bring even a Labour government into conflict with the workers and their unions. Which it did. Every Labour government since the first in 1924 has governed against the interests of wage and salary workers, by in particular opposing strikes or imposing wage restraint (for the whole of the period of the much-vaunted 1945 Labour government strikes were illegal and workers were prosecuted for striking).

Despite this, the unions retained their links with Labour, their leaders taking the view that this was still the best way to get some concessions for their members. Most still do. Bob Crow and the RMT are the exception. They have concluded that the present Labour Party no longer serves this purpose and want to form another union-based ‘Labour’ party, a Labour Party Mark 2. They want to go back to 1900 and start all over again. But at least they have realised that the Labour Party can no longer be seen even as an expression of trade union consciousness. Len McCluskey of UNITE evidently has illusions about Labour still being this, though none about the need to set up a new Labour party. Nor have we. Why try to repeat a formula which has failed once and will fail again?

Political action needed

The view that workers should take political as well as union action is sound. Capitalism, the root cause of their problems, is upheld by the state which not only guarantees capitalist ownership and control of the means of production but is also used to actively oppose major strikes, such as the General Strike of 1926 and the Miners’ Strike of 1984-5 (and many others too). So, if capitalism is to be ended, the state must be taken out of the hands of the pro-capitalists. To do this workers will have to take political action; to in fact form their own independent political party, but a revolutionary socialist party not a reformist Labour party, not even Bob Crow’s Mark 2.

Our objection to the Labour Party is not that the workers don’t need a political party but that it is the wrong type of party. This is why we have always opposed it and why we have said that the unions should not support or finance it. Our members in unions affiliated to Labour refuse to pay the ‘political levy’ to it by ‘contracting out’ of it as every union member is legally entitled to. Here we find ourselves in agreement with Miliband’s proposal that, as long as the political levy exists, union members who want to support the Labour Party financially should have to ‘contract in’ to paying it rather than automatically paying it unless they ‘contract out’.

The present system amounts to a scam with hundreds of thousands of workers paying money to a party which doesn’t represent their interests and which they wouldn’t want to join anyway. Both UNITE and the GMB have estimated that, with contracting in, only 10 percent of their members currently paying it would choose to do so. In other words, 90 percent are being conned into financing the Labour Party.

We are not saying that unions should never support a political party. We can envisage a situation in the future, when a majority of their members have become socialists, where unions might support a mass revolutionary socialist party. But we are not there yet. What we are saying is that today, when most workers have reached only a ‘trade union consciousness’, unions should not support a particular pro-capitalist party.

Not doing so makes sense from a purely union point of view too. To be effective unions need to organise workers as employees faced with the same employer or set of employers irrespective of their political opinion as well as of their religion or origin. That’s irrelevant when it comes to pressurising or standing up to an employer. To be tied to a particular party alienates workers who support some other party or don’t support any party and so undermines the basic union principle of ‘Unity is Strength’.

Union members should seize the opportunity opened up by Miliband’s proposals to distance Labour from the unions by pressing their unions to break completely with the anti-working class, capitalist reform party that Labour is.

Adam Buick

Cooking the Books: Good capitalism, bad capitalism? (2011)

The Cooking the Books Column from the July 2011 issue of the Socialist Standard

“There is good and bad capitalism,” wrote Will Hutton in a recent article for the left-of-centre think-tank, the Policy Network

He argued that

“The left has to understand what capitalism properly managed can deliver: and then to demonstrate that the paradox is that only the left can provide the political tension that biases capitalism towards the good. While the right is the indiscriminate friend of all capitalism, the left’s mission is to hold capitalism’s feet to the Enlightenment fire – and thus make it work best to meet the ambitions and needs of ordinary people.”

This – apart from the philosophical stuff about the Enlightenment (the 18th century intellectual ferment that provided the theory for the American and French bourgeois revolutions) – is what the reformists of the old Labour Party always stood for in practice, despite their talk of socialism (in most cases, actually state capitalism). They believed that it was possible, through legislation and government intervention, to humanise capitalism, to smooth off its rough edges. Only that was not how they (or those of them interested in more than just getting into office and taking on the day-to-day running of capitalism) expressed it. They talked in terms of these measures being stepping stones to something beyond capitalism rather than creating a “good capitalism”.

What Hutton is doing is bringing the theory into line with the practice. As far as Ed Miliband is concerned, he’s preaching to the converted as the Labour leader is already on record as saying he wants “a capitalism that works for people and not the other way around” (Observer, 29 August).

“Bad capitalism”, according to Hutton, is “a universe of bloated incumbents, politically fixed markets, productive entrepreneurs forced to the sidelines and too little public investment. It cares little for the condition and risks of the people.” And good capitalism? It, says Hutton, has

“two key properties – a system of business ownership in which the returns to owners and managers is proportional to the risk being undertaken rather than winners taking all, along with politically and socially constructed institutions that help mitigate risk, thus allowing more to be taken.”

This is how capitalism according to its theorists is ideally supposed to function. But even if it did function in this way, there would still be minority class ownership, production for profit, and the division of society into rich and poor. In fact, for Hutton, there are also good capitalists and bad capitalists:

“Social democrats should properly distinguish between the deserving and undeserving rich.”

He then added, curiously:

“They should also be prepared to distinguish between the deserving and undeserving worker – and the deserving and undeserving poor. Marx made this point to the French socialists in his critique of the ‘Gotha Programme’.”

Hutton may know about the Enlightenment but he clearly doesn’t know about Marx. The fact that Gotha is in Germany should have been a hint that Marx was addressing German rather than French socialists. And there’s nothing in what Marx wrote there about deserving and undeserving workers. Hutton has presumably misinterpreted the labour-time voucher scheme Marx mentioned.

What Hutton fails to understand is that capitalism is based on the exploitation of wage-labour for surplus value and is governed by the imperative drive to accumulate more and more capital out of this. Which is why it can never be made to work “to meet the ambitions and needs of ordinary people” and why it can only work as a profit-making system in the interests of those who live off profits.

There is no such thing as a good capitalism.

Greasy Pole: Fables And Fabians (2015)

The Greasy Pole Column from the March 2015 issue of the Socialist Standard

Not much longer now. One of the priorities of the Coalition government was to legislate to introduce fixed term five year parliaments so that the next election would be in May this year. At the time the discussion was about the need for some stability in government to ensure that any presented remedies for the recession would be able to run their course until the country emerged into blissful prosperity. There were of course other reasons – for example to discourage any prospective dissident Lib Dems from causing trouble when their seat on the Front Bench, with its treasured place at the upper reaches of the Greasy Pole and the right to pontificate on the chaotic futility of the efforts to control the vagaries of British capitalism, no longer depended on a particular government being in power.

Miliband

It has not turned out to be like that and the prospects now are for a ‘balanced’ House of Commons where political leaders are under pressure to reveal their present plans to establish a benignly humane society for us to flourish in. Capitalism continues on its vandalistic way while we are subjected to a series of insidious evasions by the party leaders. Ed Miliband, becoming more desperate each day to ward off those in his party who are haplessly impressed by the images recorded by sneak photo sleuths which expose his problems with eating a sandwich or dropping a coin or two to a street beggar, has been spouting the usual style of re-assurances on issues such as British capitalism's financial crisis, immigration and the like. Labour's back room strategists have worked hard to establish the delusion that these matters should be of serious concern to the voters. Which means that Miliband must pose as a leader who has the power and talent to deal with them.

National Health

And then, of similar anxiety, there is the National Health Service which is daily revealed as inadequate for anyone who is unable to afford treatment in some lavishly costly clinic. Miliband has seen the reports of problems in Accident and Emergency departments and on the wards and in GP surgeries. So he has promised that a Labour government will flood the service with doctors and nurses and GPs all of which, he says, will be driven by '...care, compassion and co-operation, not competition, fragmentation and privatisation'. Such alliteration may disguise the fact that a former Labour government began restricting the NHS on the grounds that it was being misused by hordes of hypochondriac cheats. On similarly shaky ground is David Cameron who has been promoting the false notion that the level of tax should be of concern to those who depend for their living on selling their labour power for a wage. There is, he assures us, an '...economic, moral and practical case' for lower taxes which a Tory government will be sure to apply, because '...it is people's money not government's money and we should leave them with as much to spend as we can rather than frittering it away on wasteful government projects'. But, like Miliband, Cameron is ignoring a vital reality; his government has worked devotedly to hold down 'peoples' money' as wages and to dis-empower any organisation such as a trade union which resists that policy.

Fabian Opinion

Emerging from the background, the Fabian Society recently offered a paper – In It Together – designed to provide some constructive advice to the Labour leadership: 'A Labour government is going to need all the help it can get to achieve its social mission and so needs business as an ally, not an enemy. Rather than seeing markets as needing regulation to prevent them being socially destructive, the left needs a greater focus on how they can be helped to create social good . . . What matters most is for Labour to engage business in a dialogue and then 'co-produce' a set of solutions that can achieve its vision of a more responsible capitalism . . . (but) Simply put, business doesn't trust Labour.’ This argument, apart from anything else, does not fit in with the behaviour of the last Labour government under Tony Blair (who has since shown us how advantageous a 'dialogue' with 'business' can be) and its attacks on our standards of survival as a discipline favoured by ex-ministers like Alan Milburn – now approved by the Fabians as one of the 'New Labour ultras'. In opposition to this, the Guardian on 5 February listed some of the more powerful chiefs in industry who support the return of a Labour government. Like Lord Allen of Global Radio; Graham Cole of the helicopter firm Agusta Westland; Lord Noon the 'leafy meal' millionaire; Martin Littler of Inclusive Technology.

Socialist Candidates

The Fabian Society was formed in January 1884, named after the Roman general Fabius Maximus – 'The Delayer'. It has been associated with a variety of objectives, from its earliest pamphlet which urged '. . .you must wait, as Fabius did most patiently . . . but when the time comes you must strike hard' to the present when its stated aims are rather less military: 'To promote greater equality of power, wealth and opportunities, the value of collective action and public service.' Its reformist objectives have included a national minimum wage, health service and education system, a welfare state. Among its members have been Ramsay MacDonald, Harold Wilson, Tony Benn – and er – Tony Blair who saw Fabians as '...often born relatively wealthy but who were indignant about inequality...They were like the Georges Duhamel character who says “I love humanity; it's just human beings I can't stand”'.

During the coming weeks we shall be subjected to a barrage of propaganda from the parties contesting the general election. We shall hear promises which will never be kept. Excuses for those given in the past which are now forgotten. Already there has been a contribution to this from the Fabian Society – an organisation claiming to be above such campaigning. We will have witnessed it all before, and been angry and frustrated before. The vital exception to this will be the ten candidates of the Socialist Party who will make no promises or attempts to re-write history. Their campaign will be on the single issue of the need to replace the inhuman system of capitalism with a world of freedom.

Ivan

Cooking the Books: Labour is All Capitalist Now (2014)

The Cooking the Books column from the March 2014 issue of the Socialist Standard

In his column in the (London) Times (24 January) former Blair speech-writer Philip Collins recounted how he had met a ‘nameless plutocrat’ in Davos this year who had told him that Labour, despite its protestations to the contrary, was anti-business and that Miliband was indulging in ‘intellectual Marxism’. How ungrateful and how weird is the idea some people have of Marxism.

Collins commented:

‘Mr Miliband does think Marx is a better prophet of capitalism than those who cannot see beyond their own profits. Quite right too. Business people believe in competition just so long as they are benefiting from it. They soon realise competition means somebody else might take their winnings. Echoing Adam Smith on the conspiracies that businessmen practised against the public, Marx pointed out capitalism’s inexorable tendency towards monopoly. Competition, in other words, producers its own grave-diggers.’

This is alright, except that Marx didn’t see all industries as necessarily ending up as a monopoly. He wrote rather of the concentration of production in bigger and bigger productive units and of the centralisation of the control of these by a ‘constantly diminishing number of magnates of capital’ (Capital, volume 1, chapter 32 on ‘The Historical Tendency of Capitalist Accumulation). For him, this was an expression of the fact that production had already become ‘socialised’, operated by co-operative labour of the working class as a whole. He envisaged that eventually the working class would organise to bring ownership and control into line with productive reality and ‘expropriate the expropriators,’ ushering in a socialist society based on the common ownership of land and industry with production directly for use not profit. This hasn’t happened but ‘intellectual Marxism’ still has to see this as being the future for humanity.

Labour’s answer to monopoly is not this (of course). It’s more competition. Miliband’s ambition, according to Collins, is to ‘reform capitalism’. Or, as shadow business Chuka Umunna told the Financial Times (16 January):

‘We are all capitalists now. The question is, what sort of capitalism do we want? We embrace free markets but we want competitive and free markets and more responsible capitalism.’

This is the opposite of what socialists want. Labour wants to mend capitalism; we want to end it.

Labour is not anti-capitalist or anti-business at all. Most ‘nameless plutocrats’ and ‘magnates of capital’ will know this perfectly well, but this hasn’t prevented them, and their supporters in the Tory party (the party of the rich, as most people recognise), raising a howl of protest at a rather innocuous Labour promise to restore the 50 percent rate of tax on that part of anyone’s income over £150,000 a year.

There is nothing anti-business about this as it is a tax on personal income whereas the aim of capitalist production is to extract and accumulate profits as more capital. It is not to provide a privileged income for capitalists, though of course it does do this. The ‘entrepreneurs’ (as capitalists prefer to call themselves these days) who London Evening Standard columnist Richard Godwin said he had met were behaving more capitalistically:

‘When they started their businesses, they had neither the means nor the inclination to withdraw a six-figure salary for themselves. They preferred to reinvest’ (29 January).

But the plutocrats and magnates are people and they like their privileged income and the lifestyle it enables them to enjoy. In complaining about an increase in their income tax they are not being pro-business. They are being pro-themselves. As Godwin put it, ‘That’s not entrepreneurship – it’s self-interest.’

Cooking the Books: Producers and Predators (2011)

The Cooking the Books column from the November 2011 issue of the Socialist Standard

Producers and Parasites was the title of a 1935 pamphlet by the Scottish-born American Marxist John Keracher. On the face of it Ed Miliband’s distinction in his Labour Party Conference speech between “producers” and “predators” seems more radical. After all, aren’t predators worse than parasites? But this is only on the face of it, as what Miliband meant by producers was quite different from what Keracher did. Nor were his “predators” the same as Keracher’s “parasites”.

Keracher was explaining Marx’s theory of surplus value which starts from the observation that wealth can only be produced by humans applying their mental and physical energies to materials that originally came from nature. Under capitalism these producers are exploited in that the difference between what they are paid as wages and salaries and the value of what they produce is appropriated by those who own and control the means of production. These capitalist employers and their hangers-on are “parasites”, argued Keracher, living off the unpaid labour of the “producers”.

Miliband’s distinction is not between wealth-producing workers and those who live off profit, interest and rent, but between two types of capitalist. It’s a distinction between Keracher’s parasites. According to Miliband, there are good capitalists who invest in providing goods and services and jobs (the “producers”) and those who are out to make a quick buck through asset-stripping and financial wheeling and dealing (“predators”).

There are two things wrong with this distinction. First, it accepts the capitalists’ impertinent view of themselves as wealth-producers (in Stock Exchange circles they even call mining companies “miners”); whereas all wealth is produced by those who work with their hands and brains, not those who invest for profit. Second, all capitalist firms are predatory in that their aim is to grow bigger by winning the battle of competition against their rivals and absorbing them through take-overs. That’s what all the big capitalist firms of today have done, including Rolls Royce, which Miliband cited as an example of a good capitalist.

For some reason, commentators interpreted Miliband’s speech as a turning to the left by the Labour Party. Certainly it was a piece of demagogy that went down well with his audience of councillors, would-be councillors and trade union bureaucrats. But in essence it was no different from Ted Heath’s 1973 denunciation when Tory PM of Tiny Rowland and Lonrho as “the unacceptable face of capitalism.”

Actually, the speech was an open recognition of what has always been the Labour Party’s practice – accepting capitalism and trying to smooth off the rough edges of capitalism, to humanise and moralise it. Cameron employed the same approach when, in opposition, he spoke of the Tories standing for “compassionate capitalism.” (It’s a different story now.)

It’s a pipe-dream of course. Capitalism is a system based on the exploitation of the real producers which can only work in the interest of the parasites, whether predatory or passive, who live off profits. It can never be made to work in the interests of the majority, as the experience of the present Coalition government and the immediately preceding Labour government is showing. In fact, as the experience of all governments everywhere has always shown.

Greasy Pole: Kinnock in the News Again (2013)

The Greasy Pole column from the November 2013 issue of the Socialist Standard

Anyone who suffers from a sense of being unvalued, or disregarded, might find some relief in the recent experience of Neil Kinnock. Or rather the Noble Baron Kinnock of Bedwellty, previously Member of Parliament, Leader of the Labour Party and of Her Majesty's Loyal Opposition, European Commissioner, Chairman of the British Council...and lifelong supporter of Cardiff City Football Club, recently promoted to the Premier Division and infamous for the aggressive, disruptive behaviour of its fans. In September he went to watch Cardiff play Fulham at Craven Cottage. Although a seasoned football follower like Kinnock should have known better, he chose to sit with his family among the Fulham supporters. In the twelfth minute Cardiff scored a goal which had Kinnock, in his own words, 'wildly ... expressing great joy, standing up...' Within a minute he got some attention from the stewards who 'advised' him to move his party to the Cardiff section of the crowd, where they were greeted '...with some warmth'.

The Sun

Shortly after the exposure of his antics at Craven Cottage Kinnock was in the news again, competing with Ed Miliband for sympathetic attention during the Daily Mail campaign about the Labour leader's father 'hating Britain'. He said he had similarly suffered, especially during the 1992 general election when the Sun had devoted its front page to the infamous headline 'If Kinnock wins today will the last person to leave Britain please turn out the lights' followed on the day after the election with the claim that 'It's the Sun Wot Won It'. He also had something to say about the Daily Mail editor, the gruesome Paul Dacre, who complained that Kinnock had avoided going to lunch with him when the only purpose in doing so would have been for Dacre to observe whether Kinnock held his knife and fork properly. This was all a part of Kinnock's assiduously constructed image of the humble son of a Welsh miner who won his way to a sparkling education and then to almost the very top in government. But it said nothing about his own readiness to attack opponents, particularly those in his own party, as abrasively as anything thought up in Fleet Street. One of Labour's leading lights during Kinnock's time, Denis Healey, praised his 'incandescent oratory', a possible example of which was his attack at Labour's 1985 conference on the Liverpool members for their 'far-fetched resolutions ... pickled into a rigid dogma, a code ...the grotesque chaos of a Labour council ...hiring taxis to scuttle round a city handing out redundancy notices to its own employees'.

In the sea

Kinnock was elected leader at the 1983 Labour conference in Brighton. To celebrate he went for a walk along the beach accompanied by his wife and a clutch of TV cameras. It turned out to be somewhat symbolic. This young, loud, fiery left winger walked too close to the encroaching tide, a sudden surge knocked him down onto the wet shingle, he quickly scrambled to his feet and turned to face the cameras laughing defiantly and waving a clenched fist to show how he would punch out anyone who denied that this was a new Labour Party. His mission was to purge the inconvenient ideas which some restless party members still regarded as essentially matters of principle. Like all that nonsense in Clause Four about the ownership of the means of production and exchange (which had to wait for abolition until Tony Blair); unilateral nuclear disarmament; local parties having too much say in making national policy; those pesky Militant people who had come into the party nursing tortuous intentions to radically change society. With the hand of the insidious Peter Mandelson on the tiller Labour navigated through two elections, in both of which they fooled themselves that they were on the verge of power (in the after-assessment of their 1992 election one of their perceived mistakes was the 'triumphalist' – taking too much for granted – style of their eve of poll campaign). In the end Kinnock's aggression against any ideas which he saw as voter-repellent was not effective. He retired from the scene with the unenviable record of being the longest-serving Leader of the Opposition to fail to make it to Prime Minister. It was not at all as he had envisaged it, that day he fell into the sea.

Peerage

But there were other, very lucrative, opportunities open to him – such as European Commissioner, which in 1976 he had described as 'a tariff club administered by an unelected commission and a bureaucracy with the principal objective of sustaining a capitalist market economy' but which, during his time in office between 1995 and 2004 (while he imposed savage cuts in staff wages and pensions) yielded him some £2.5 million in salary, expenses, pension and the like. Shortly after his term in Europe came to an end he announced that he had '...accepted the kind invitation to enter the House of Lords as a working peer for practical political reasons'. He was not deterred by his established reputation as a bitter opponent of the Upper House, for example in 1976: ' The House of Lords must go – not be reformed, not be replaced, not be re-born in some nominated, life after death patronage paradise, just closed down, abolished, finished'. In case he was misunderstood, in 1977 when the MPs walked to the Lords to hear the Queen's speech to open Parliament he stayed defiantly seated in the Commons alongside the Beast of Bolsover Denis Skinner.

Blair approval

Kinnock's story has been a bit like someone recovering from a serious illness; one after another the symptoms of all those fevered days as a troublesome, agonisingly ambitious left-winger died away to be replaced by convalescent signs of conformity. He strongly supported Michael Foot in his turn-about over the Falklands War, including the sinking of the Belgrano. And he backed the British attack on Iraq on the feeble excuse that the infamous liar Tony Blair had assured him that the Americans would safeguard the situation there after the war. Such political acrobatics were, of course, warmly approved by Blair, who noted in his book A Journey that as a result of Kinnock's leadership the Labour Party became 'broadened and ...more popular'. Nothing more needs to be said about Kinnock's relentlessly cynical betrayal of so much that he once proclaimed as promises to radically transform society to humanity's benefit. An overview of his time reveals his passionate support for Cardiff FC to be a lone example of consistency.

Ivan

Cooking the Books: Dirty Talk at the Tory Conference (2013)

From the November 2013 issue of the Socialist Standard

‘Profit is not a dirty word, says Cameron’, read the headline in the (London) Times (2 October), anticipating what he was going to tell the Tory conference that day:

‘It is businesses that get wages in people’s pockets, food on their tables, hope for their families and success for the country,’ he will say. ‘Profit, wealth creation, tax cuts, enterprise: these are not dirty elitist words.’

Some of this is true, but some is not. It is true that businesses do pay people wages but it can be doubted that they provide ‘hope for their families’. And ‘wealth creation’ is not a dirty word as long as it is understood that it is those who work for a wage who produce wealth not the business enterprises that employ them and only pay them as wages a part of what they produce.

As far as the workings of capitalism is concerned, Cameron’s point is valid. For capitalism, profit is not a dirty word as it’s what drives the system. It is an incentive to the profit-seeking businesses which control production under capitalism to produce, but only up to a point – the point at which it is no longer profitable to produce any more, even if some people’s needs have not been met. ‘No profit, no production’ is a basic economic law of capitalism.

The pursuit of profits distorts production by only responding to what people can pay for rather than what they need, so the richer you are the more and better you get while the needs of those who can’t pay are not met. ‘Can’t pay, can’t have’ is another basic economic law of capitalism.

The pursuit of profits also leads from time to time to overproduction (in relation to the market not needs) and the sort of economic downward that we are now in. No wonder supporters of capitalism have to work hard to try to convince people that profit is not a dirty work.

A couple of days earlier the Chancellor of the Exchequer, George Osborne, also had a go at criticising socialism, saying that for Ed Miliband (as if he was a socialist):

‘the global free market equates to a race to the bottom with the gains being shared among a smaller and smaller group of people. This is essentially the argument Karl Marx made in Das Kapital.’

Actually, Marx did say something like this, but in a speech he gave on Free Trade to a meeting of radical democrats in Brussels in 1848 rather than in Capital.

Osborne implies that, like what he accused Miliband of, Marx too wanted to try to protect people from the workings of the ‘global free market’. But he didn’t. He said he was in favour of free trade as he thought, somewhat over-optimistically, that this would speed the social revolution:

‘But, in general, the protective system of our day is conservative, while the free trade system is destructive. It breaks up old nationalities and pushes the antagonism of the proletariat and the bourgeoisie to the extreme point. In a word, the free trade system hastens the social revolution. It is in this revolutionary sense alone, gentlemen, that I vote in favour of free trade.’

Socialists still look forward to the social revolution Marx was anticipating which will replace the capitalist world market by a global socialism where, on the basis of the common ownership of the world’s resources, there would be production directly to meet people’s needs rather than for sale on a market with a view to profit.

Cooking the Books: Ed’s Dad (2011)

The Cooking the Books column from the February 2011 issue of the Socialist Standard

“My Dad,” Labour Leader Ed Miliband told BBC Radio 5, “would have considered himself a socialist too, but he would have said we need to have public ownership of everything.” ((London) Times, 27 November).

It’s true, his dad, Ralph Miliband, was a left-winger who identified “socialism” with full-scale nationalisation, or state capitalism – as we pointed out in a review of his book The State in Capitalist Society in the August 1969 Socialist Standard:

“This is a confusing book in which Miliband sets out to prove what he takes to be the Marxist theory of the state. Although he does define his terms he uses words like ‘capitalism’ and ‘class’ in a non-Marxist way. Capitalism, he holds, is based on private enterprise, private profit and private accumulation. This raises suspicions, which are confirmed, that he has an odd view of Socialism too. Russia, he says, is ‘collectivist’, ‘non-capitalist’ and, in an unguarded moment, even ‘socialist’. The concept of state capitalism is clearly unintelligible to him and is nowhere discussed, not even in relation to nationalisation in the West.”

Nationalisation is not socialism as it is only a change of owner and employer, leaving workers still having to sell their labour power for a wage or salary and still exploited for surplus value. In the West the former owners were paid compensation and so continued to receive a property income but as interest on government bonds rather than as dividends. In Russia the beneficiaries were those who dictatorially controlled the state and awarded themselves a privileged income as bloated salaries, prizes, country houses and other benefits in kind.

Ralph Miliband’s best known book is probably his 1961 critical history of the Labour Party from a leftwing Labour point of view, Parliamentary Socialism. In the concluding chapter, entitled “The Sickness of Labourism” he observed:

“By the late fifties, the Labour leaders, obsessed as they were with the thought of electoral success, had come to be more convinced even than were their predecessors that the essential condition for that success was to present the Labour Party as a moderate and respectable party, free from class bias, ‘national’ in outlook, and whose zeal for reform would always be tempered by its eager endorsement of the maxim that Rome was not built in a day – or even in a century. Never indeed had Labour leaders been so haunted by a composite image of the potential Labour voter as quintessentially petit-bourgeois, and therefore liable to be frightened off by a radical alternative to Conservatism.”

Plus ça change. There was nothing new about New Labour, except that Blair succeeded where Gaitskell failed in getting rid of Clause 4, which committed Labour on paper to full-scale state capitalism.

He went on to quote from the study of the 1959 General Election by David Butler and R. Rose their view that the Labour Party “as in all recent elections …played down any claim to stand, as a socialist party, for a radically different form of society …it asked the voters to say that it could administer the mixed economy welfare state better than the Conservatives”.

Which is precisely what Ed Miliband is on record as promising to try to do. As he told the Observer (29 August): “I’ll make capitalism work for the people”. Oh no, he won’t – because that’s not possible, not even if he followed his dad’s line and nationalised everything. State capitalism can’t be made to work for the people either.

Cooking the Books: Capitalism and the Labour Party (2010)

The Cooking the Books column from the October 2010 issue of the Socialist Standard

“I’ll make capitalism work for the people,” promised Ed Miliband in his bid to become Labour leader (Observer, 29 August). He explained:

“Britain’s big question of the next decade is whether we head towards an increasingly US-style capitalism – more unequal, more brutish, more unjust – or whether we can build a different model – a capitalism that works for people and not the other way round.”

Apparently, “in 2008, a consensus existed that we should understand the lessons of the financial crisis, not just about regulation, but about the kind of capitalism we needed to build”.

We’ve heard this before. The Labour Party has always tried to make capitalism work for the people but, every time that it has been in office, it has failed miserably. What is new is that previously Labour leaders never admitted that this was what they were trying to do. They said they were trying to gradually reform capitalism out of existence, not building a new kind of capitalism.

Still, an open recognition of what they are trying to do can only help clarify things. It is, however, indicative of how far Labour has changed that Ed Miliband was the candidate supported by the Left in the party. Even they have bought into the idea that there is no alternative to capitalism, only a choice about what sort of capitalism, and dropped the anti-capitalist rhetoric.

Ed’s brother David, the candidate supported by the Right declared that his Labour hero was Anthony Crosland (New Statesman, 30 August). He was the Fabian Society Labourite who argued that capitalism no longer existed. Which might explain why David Miliband, and Blair and Brown before him, refuse to use the c-word.

The reason Labour – and indeed the Tories who also talk of a “people’s capitalism” – fail to make capitalism work for the people is that this is an impossible mission. Capitalism just cannot be made to work in the interest of all. It is a profit-making system that can only work as such, in the interest of those who live off profits and to the detriment of those who live off wages and salaries or, in the absence of these, on state hand-outs.

The driving force of capitalism is the accumulation of capital out of profits. When this slows down, as at present, there is a crisis. So, governments must not do anything that might discourage the making of profits to accumulate as capital; in fact, even if it wasn’t their original intention (as perhaps, giving them the benefit of the doubt, it wasn’t with some Labour governments), they have to end up doing all they can to encourage this.

Inevitably, this brings them into conflict with the wage and salary working class whose labour is the source of profits, imposing wage restraint and/or austerity on them. This is not because the government’s members are nasty or incompetent or corrupt, but because this is how they are forced to act by virtue of being the government in the context of capitalism. They fail because they can’t act in any other way.

Instead of Labour gradually changing capitalism into something else, the experience of running capitalism changed the Labour Party – to the extent that today you are labelled a left-winger if you just mention the word “capitalism”, even to support it.