The Emerging World Scene (1946)

From the November 1946 issue of the Socialist Standard

There is no doubt that things are on the move. Incessant activity on the part of politicians leads one to speculate as to what is pending. The Nuremberg Trial is now a thing of the past, the U.N. is proposing to take a breathing spell, the Conservative Party holds a conference, the U.S. takes decisive action in Europe; in short, what we see in our master’s press leads to the belief that the decks are being cleared for action : the capitalist class have, in the main, decided upon what they are going to do.

The American Presidential election takes place in two years’ time, and all those aspiring to office in the United States act, and speak, under the spell of that important fact. Eisenhower, who recently spoke at Edinburgh, Byrnes, the representative at the U.N., Wallace, the former U.S. Secretary of Commerce, and many others are thinking when they speak not so much of the subject in hand as of the American election of 1948.

Eisenhower said in his speech of October 3rd : “World neighbourliness must be achieved or else, we shall, in a twinkling, travel a backward route over mankind’s long and laborious progress from his ancient caves to the present.”—(Daily Telegraph, 4/10/46.)

Mr. Byrnes says that if other Powers will agree to the 40-year Treaty proposed by him, this treaty will bind “not merely the present American administration, but its successors.”

Commenting on this, the Daily Telegraph of October 4th says : —

“Of the four Powers consulted upon this proposal, Britain, France and the United States are favourable, and it, is only from Russia that a refusal has so far come. This refusal is no doubt partly based upon those divergencies of view between the wartime Allies to which Mr. Byrnes made discreet reference. The prospect of a democratic Germany as seen by the State Department and by the Kremlin is strikingly different. Yet it is difficult not to surmise that Marshal Stalin’s objection to the Four-Power Treaty is mainly based on the fear, not that the United States will disinterest herself from Europe, but on the contrary, that the Treaty would serve to maintain her influence there. Mr. Byrnes’s reference to the Yalta declaration and the continued American interest in the Balkans indicates that this influence will, none the less, persist.”

Mr. Byrnes has a good election cry for 1948 : his rival, Mr. Wallace, who recently was rapped over the knuckles by President Truman and, as a consequence, lost his job, is losing out in the race; the policy of isolationism is no longer in favour in capitalist circles. 

Mr. Baruch, United States representative on the Atomic Control Commission, has vigorously attacked Wallace, and stated that the latter was totally ignorant of the facts underlying atomic control. Wallace is now trimming his sails, and states, in excuse for his attack on Mr. Byrnes’ policy in regard to Russia, “that he had obviously not been fully posted as to the facts.” The deadlock over atomic control, according to Wallace, results from absence of mutual trust between U.S. and Russia. He faces both ways, like all politicians placed in similar circumstances, by concluding that “the United States is in a better position to assume leadership which will lead,” but he has no plan except that of stopping the manufacture of atomic bombs.

If we read between the lines the general conclusion arrived at is that a peace treaty is going to be patched up. Russia is compelled to accept the U.N. decision on Trieste, and her policy regarding the Danubian Waterway has been opposed so strenuously by Britain, France and the United States that she is compelled temporarily to give way to them.

There is little likelihood of a long or permanent peace; however, the nations will, in all probability, prepare for what, under capitalism, is inevitable with what speed they may. Britain is evidently not going to be caught napping. Look at this: —

£12,000,000 FOB ROCKET TESTS.

AUSTRALIAN PLANT.

“The British and Australian Governments may be involved in an expenditure of between £12,000,000 and £14,000,000 in the construction of rocket-bomb workshops and testing ranges in Australia. The annual maintenance cost is expected to be about £3,000,000.

It is understood the Australian Government has received advice from Britain setting out proposals for research and development and for testing grounds in the centre of Australia. These are based on the recommendations of a mission of experts and scientists which visited Australia early this year”.—(Daily Telegraph, 4/10/46.)

It is against the above background we must judge the speeches of Sir Stafford Cripps at the Empire Trade Conference on October 3rd.

The Tories have recently laid stress on Imperial Preference; the following is Stafford Cripps’ reply.—

“It was an obvious and sensible course for us to pursue to endeavour to extend and consolidate our inter-Commonwealth trade.

"But that trade alone cannot fully meet any of our needs, and it would defeat our object of full employment and prosperity for our own people if we were to concentrate on Commonwealth trade alone and neglect those wider fields of world trade which we must cultivate.”

You are plainly told the Empire is not enough for British Capitalism; the Government must go hunting elsewhere for markets. The system compels expansion; the world is the limit; the clash between nations cannot be avoided. Socialism is the only means of saving mankind from destruction, and, unfortunately, Socialism is not yet fully understood by those who are called upon by history to establish it.

The Conservative Conference was held by men who observe the signs of the times, and are getting ready to deal with a situation they think will arise in the not far distant future.

The Labour Party is designated as the Socialist Party, but one statement made by Mr. Eden will be very interesting to the readers of the Socialist Standard.

“There is one principle underlying our approach to all these problems, a principle on which we stand in fundamental opposition to Socialism. The objective of Socialism is State ownership of all the means of production, distribution and exchange. Our objective is a nation-wide, property-owning democracy. (Cheers.)

These objectives are fundamentally opposed. Whereas the Socialist purpose is the concentration of ownership in the hands of the State, ours is the distribution of ownership over the widest practicable number of individuals. (Cheers.) Both parties believe in a form of capitalism, but whereas our opponents believe in State capitalism, we believe in the widest measure of individual capitalism.”—(Daily Telegraph, 4/10/46.)

Eden knows, and clearly shows, that the difference between the Labour Party and the Conservative Party is a difference in degree and not in kind.

The propaganda of the l.L.P. and kindred organisations have confounded Socialism with State Capitalism.

Mr. Eden is slated for the Premiership and the odds are in his favour.

Division in the Labour Party is probable, and the Communists may hasten it along. “For or against the Soviet Union” may arise as an issue out of the present political situation. The Cabinet will be up against it if they are forced to decide between Russia and the United States. The “Labour Progressives”, supported by Communists, will go wholeheartedly for Russia if such an issue develops, so will many of their followers in the Unions, and the question, is what will happen to the Labour Government in these circumstances?

Anthony Eden is the most likely man for the Premiership in the Coalition Government which it is anticipated would then spring into being as a matter of course.

The above is how the prophets have worked it out; they may be right, but, as Shaw says, “You never can tell.”

Meanwhile the wage slave plods his weary way. his meagre rations barely sufficient to enable him to carry on.

So Capitalism staggers along through the stages that precede its dissolution. It must live its life, but the end is drawing nearer every day.

Wherever you go nowadays you find working men not only discussing the political situation, but analysing it ably and well.

The war has not succeeded in blowing out the light within the brains of the members of our class; it has accelerated the growth of class consciousness, and increased the knowledge of the system that is its cause.

In the chain gang of wage slavery this knowledge is being passed from man to man and from woman to woman. The substance of Socialism is being absorbed by ever-increasing numbers.

The effects of this may be clearly revealed in the intelligence displayed by the workers in the strenuous conflicts that lie ahead.

The inherent antagonism between the exploited and their exploiters cannot be suppressed; it will become world wide; wherever Capitalism goes Socialist ideas cannot be prevented from appearing and playing their historic part.

The Capitalist class are bent on rejuvenating a system that is now senile. They cannot give it a new lease of life.

The working class will soon be forced to try and discover ways and means of ending it. We are with them because we are of them. There is no doubt as to the result. Society must establish Socialism or perish. The expropriation of the expropriators is the only way out.

Charles Lestor

Roosevelt's "New Deal" (1934)

From the June 1934 issue of the Socialist Standard

The whole world has been watching with interest the progress and results of President Roosevelt’s “New Deal,” more correctly described as American capitalism’s strenuous effort to rescue itself from the morass of depression.

After three years of deepening crisis, falling prices and wages, increasing bankruptcies, and unemployment that reached the unheard of total of from 15 to 17 millions, the country was seething with political unrest. The Hoover regime, which had attempted to conjure the depression away by wish-magic and optimism, but had otherwise done practically nothing to alleviate the economic dislocation, was overwhelmed in the democratic landslide of the 1932 elections. Roosevelt and his party swept the country with their attacks on the “criminal inactivity” of the Republicans, and with lavish promises of a New Deal that would bring back “ Prosperity.”

In general, although there is much intertwining of interests in the propertied class the Republican Party stands for big business and the financial interests. The Democrats are the party of the smaller business men and the mass of the farmers. The most voluble, agitated and organised of all those adversely affected by the depression were precisely these latter groups. Millions of small property owners were hopelessly in debt, their savings gone or tied up in closed banks. The farmers’ earnings and standard of life had been declining for years before the crisis which but intensified their problems. Amongst the workers cut after cut in wages, plus mass unemployment and the constant threat of it, had generated a great volume of discontent. This was, however, largely unorganised and inarticulate, notwithstanding sporadic outbursts. All these elements looked to Roosevelt as to a messiah. Emotional tension at the time of the elections was intense and enthusiasm for the victorious “hero” almost universal, even amongst many of the rank and file Republicans.

Immediately after its inauguration in March, 1933, the new Government was granted extraordinary emergency powers by the overwhelmingly Democratic Congress. Then came the passing, almost without criticism, of a series of drastic laws drawn up by Roosevelt and his group of economic advisers which set up a whole battery of new administrative bodies for a concerted attack upon the problems of ”recovery” and “relief.” Of these bodies the Agricultural Adjustment Administration and the National Industrial Recovery Administration (the N.R.A.) are the most important. As we are chiefly concerned with the interests of the industrial workers, it is the N.R.A., and particularly its labour provisions, that we shall mainly consider.

The N.R.A. came into existence in June, 1933. First it established a General or “Blanket” Code of Fair Competition, which all employers were asked to sign and adhere to. A national propaganda campaign, using all means of ballyhoo, mobilised the vast pro-Roosevelt sentiment behind the scheme. By August 1st over 700,000 employers had signed and received the badge of the Blue Eagle. Compulsion was threatened if persuasion failed—a piece of bluff characteristic of many aspects of the New Deal.

The Blanket Code established a maximum working week of from thirty-five to forty hours, minimum wages varying from twelve dollars to fifteen dollars per week, and made certain classes of child labour illegal. Section 7a of the code guaranteed workers the right of collective bargaining through representatives of their own choosing. The N.R.A. further called upon each industry to draw up a code adapted to its own special needs, each code to be in harmony with the Blanket Code and approved in its details by the N.R.A. The following condensed account of the Steel Industries Code is given as a sample:—

  “The Steel Code . . . provided for a trial period of ninety days. At the end of this period the steel companies declared it workable . . . It provided for a forty-hour week of labour averaged over three months, with a maximum for each employee of not more than forty-eight hours in a 6-day week. The right of collective bargaining was conceded. Representatives of the N.R.A. were empowered to inspect the records of the Iron and Steel Institute to obtain full 'information concerning production, shipment, sales and unfilled orders, hours of labour, rates of pay and other conditions of employment,’ in order to stabilise production.” (The World Almanac, 1934.)

To date, over 400 codes have been put into force and it is estimated that about 20 millions of workers or 90 per cent. of those eligible come within their regulations.

A primary feature of the whole “recovery” programme has been the efforts to artificially stimulate a general rise in prices by credit and currency schemes, and by limiting price-cutting and controlling production through the codes. Because the crisis was accompanied by falling prices it has been assumed by almost all capitalists that if only prices could be pushed up “prosperity” would be here again. Yet it is evident that unless rising prices result from a growing demand for goods, the effect must be to curtail sales. This fact is recognised by the recovery administration. Roosevelt and his economist advisers have, for perhaps the first time in the history of capitalist politics, insisted on the need for greater purchasing power amongst the masses if "prosperity" is to be regained and maintained. This attitude is partly, no doubt, a political manoeuvre to attract working class support. It is certainly emphatic enough, and none of the New Dealers have more clearly expressed it than H. A. Wallace, the present Secretary of Agriculture. In his pamphlet, "America Must Choose" reprinted in part in the New York Times, February 25th, 1934, he says:—

   "There can be little doubt that the trouble traces, in whole or in part, to a maldistribution of income. That doctrine is implicit in our New Deal, which seems to me to rest on irresistible logic. We are trying to build up consumption per capita at home as a substitute for new consumers abroad. Our new method involves a planned redistribution of the national income, in contrast with the unplanned redistribution that takes place regularly, usually unhappily, in every major economic crisis the civilised world over. ...
  "Our New Deal seeks to promote consumption more soundly. It directs purchasing power to those in need by wage advances and alleviations of debt. It lessens the need to force exports. It looks toward balancing production with consumption at home."

In considering this aspect of the New Deal it is important to note that the schemes of the administration to raise wages have been timid in the extreme. Compare them with the bold experiments in banking control, crop reduction and business control through the codes. The fixing of minimum wage-rates affects only the lower-paid strata of workers, directly at all events. How higher-paid workers may be affected is well shown by A. Epstein, a writer on reform questions, in ah article, "Is it a New Deal?" (Current History, March, 1934): —

   "Under the new dispensation, many less efficient workers were completely cast out of industry. On the other hand, many of those who were formerly considered cheap and inefficient were discovered to be able to do almost as good work as that formerly done by employees who received more than the minimum wage in the codes.
  "Since the codes did not abolish the employer's right to hire and fire, he was able either to dismiss entirely his most expensive help or to rehire them later at wages more nearly approaching the minimum. The endless possibilities in such reductions were quite unexplored. Even now there is no way of estimating whether or not the meagre accruals in purchasing power of the lowest-paid wage-earners exceed the reductions in the wages of higher-paid employees. There is no conclusive evidence whatsoever that the N.R.A. . . . with its unwieldy mechanisms for enforcement, has actually resulted in increasing labour's total purchasing power. The contrary is more likely to be true."?

Unorganised white-collar workers are especially liable to be affected in the above manner. L. W. Zimmer, in charge of the employment bureau of New York University, reported last October that "The $20 to $22 job is now about a $15 job, because employers tend to keep their wages around the N.R.A. minimum." He added that the number found jobs was not appreciably above that of the same period of the preceding year. (N.Y. Telegram, October 11th, 1934.)

Despite the fact that one of the avowed objects of the N.R.A. is the abolition of "sweating," the minimum wage rates are only about one-half of the figure, $26.77, which in 1932 was declared by the Department of Labour to be a bare subsistence wage for a family of five. It is well known, moreover, that great numbers are receiving less than the minimum. Fear of unemployment and victimisation effectively prevents complaints to the local N.R.A. Similar evasions in hours of labour are widespread.

The actual increase in individual earnings where there has been a growing demand for workers owing to increasing business has been very small. The American Federation of Labour in its annual review of industry for 1933 reports average weekly wage rates in 16 industries as being $20.53 in November, 1932, $20.56 in November, 1933, and $20.83 at the end of January, 1934. Retail food prices, according to Bureau of Labour Statistics, had risen 20 per cent. between April, 1933, and February, 1934, whilst clothing and furnishings had risen 27 per cent. It is thus evident that the average worker’s standard of living and purchasing power was actually declining during the first seven months of the N.R.A.

The attempt to absorb any large proportion of the unemployed by the reduction of hours to 35-40 weekly is futile so long as business continues at a low ebb. So great had been the spread of short time prior to the New Deal, that the average hours worked in June, 1933, were: crude petroleum industry, 42.6 hours; iron and steel, 37.9 hours; soft coal, 28.5. (Monthly Labour Review, August, 1933.) The average over all manufacturing industries for the first five months of 1933 is estimated at 34.7 hours.

It is, moreover, almost certain that with industrial recovery, machinery and speeding up will enable output at the code hours to equal or even surpass that reached with the longer hours of the pre-depression period. It is extremely significant that the makers of machinery are experiencing what is perhaps the sharpest pick-up shown in any industry. The New York Times (September 24th, 1933) reported that makers of machine tools did 400 per cent. more business in August than in the preceding March. This report further says: “The largest call for new equipment comes from textile mills, which are seeking high-speed machinery to replace the obsolete looms they find too expensive to operate under present high production costs. Producers of men’s and women’s garments are also investing freely in machinery capable of producing more goods in the limited working time allowed under the recovery codes. . . . Manufacturers of machinery attribute the present demand for labour-saving machinery to the desire of producers to keep up previous production schedules while remaining within the limits of the working hour provisions of the recovery programme.” Could anything show more clearly the tangle of contradictions in which the N.R.A. is involved, how its provisions are nullified even when obeyed to the letter, by the inescapable trends of capitalist “enterprise” ? It may be added that so great have been the advances in machinery and other means of production during the years of depression that students of the question agree in believing that with industry restored to its high 1929 level of output, 4,000,000 workers would remain unemployed. Only a further expansion of total production would reduce that figure.

Especially significant is the recent decision to close all of the 900 silk mills for one week on account of large unsold stocks. The textile code authorities have given this order, and violators are threatened with legal penalties. Hundreds of thousands of workers will be laid off.

During the first four months of the Roosevelt administration there was a swift improvement in business. This is generally attributed, in part at least, to the endeavour of manufacturers to lay up stocks before the rise in the costs of production which were expected to result from the Roosevelt policies. The New York Times index of business activity registered its lowest point, of 47.9, in March, 1933. (100 is the estimated “ normal,” but this, to-day, is arbitrary, and a return to it would still be under slump conditions.) The index rose rapidly, and momentarily touched 99 in mid-July, one month after N.R.A. was born. Then began a slow decline, reaching 72.5 in early November. Since then there has been a slow, wavering advance to 87.5 on May 5th. As there has been an improvement in business over most of the capitalist world in the past few months, it is doubtful, to say the least, to what extent the N.R.A. has been instrumental in assisting recovery in America.

There has been a moderate reduction in unemployment. The A.F. of L. report for May, 1934, states that unemployment was reduced from its peak of 13.6 millions in March, 1933, to 10.1 millions in October, but that between October, 1933, and March, 1934, 780-thousand had lost their jobs again. Statistics on unemployment in the U.S. are, however, notoriously incomplete and unreliable. The A.F. of L. figures do not take into account agricultural and certain other classes of workers. The estimate of the Alexandra Hamilton Institute, which does take these into account, places the high point of unemployment at 17 millions. The A.F. of L. estimates that the total wages paid per week increased by 23.7 per cent, between March, 1933, and March, 1934.

Let us now look at the way in which the trend to recovery is affecting the capitalists. In the aforementioned A.F. of L. report it is stated that "the first fifty-one companies to report for the first quarter of 1934 showed total profits of $18,740,000, compared with $6,332,000 in 1933. Dividends, the Federation said, were $15,000,000 higher in March. 1934, than in March, 1933.” (New York Times, May 6th, 1934.) This tendency is precisely what one would expect. It is inevitable that, with the upward trend of production, the increase in returns on capital will be more rapid than the increase in income to the workers. Just as the slump in production was due to conditions which forced down the rate of profit, so the expansion of production can only result from conditions which cause the rate of profit to rise. Profit is the sole motive to production under capitalism, N.R.A. or no N.R.A.

It is evident, therefore, that the principle upon which the labour policy of the New Deal is in theory based, that a greater proportion of the national purchasing power must go to the workers, is not materialising, and it is not likely to.

Next month we will consider the N.R.A. and Trade Unionism.

R. W. Housley

Workers’ Socialist Party (U.S.A.)

The Wallace Case (1948)

From the February 1948 issue of the Socialist Standard

The Presidential election in the United States is due this year. The difference between tiie Democratic and Republican policies is so small that the intrusion of Henry Wallace, as third candidate, seems to many as the only alternative for the workers of the United States.

Mr. Henry Wallace, one-time vice-president to the late President Roosevelt, claims to speak for the “freedom loving people “and against “the reactionaries in the Democratic and Republican Parties." His present pro-Russian leaning has ensured him the support of Moscow’s overseas agents, the Communist Party. The London Daily Worker greeted him in no uncertain terms when he announced that he would stand for President.

  “The basic significance of the Wallace decision is that the flag of a real democratic American policy has at last been raised in the United States in the form of a challenge to the Presidency.’’ (Daily Worker, 1/1/48.)

This friendship of the Communist Party however, may lose for Wallace the support of the rival radical faction—the Americans for Democratic Action (led by Eleanor Roosevelt). As the Observer (4/1/48) put it: “Mr. Wallace has forfeited the support of all true progressives and intelligent conservatives in the United States.’’ Already the Political Action Committee of the trade union federation, the C.I.O., has refused to endorse his candidature. As the C.I.O. in an election only supports what it considers the “friends of labour ” it is apparent that Henry Wallace, even in their eyes, does not compare too favourably with their rival candidates. This does not come as a surprise to the Socialist movement. Socialists have seen before these radical rockets careering through the sky, who, despite their electioneering speeches, prove in power to behave like the rest of the capitalist politicians. Mr. Wallace —out of power—speaks of the sinister activities of reactionaries who support the Marshall Plan, though he conveniently does not mention his own editorial commenting very favourably on the nomination of General Marshall for Secretary of State. 

As an old New Dealer he stands for private capitalism with a certain amount of State intervention which he calls “economic democracy.” But occasionally Henry lets the cat slip out of the bag. In an interview he was asked by Mr. Dwight Macdonald (editor of Politics): “What do you mean by ‘economic democracy’? ” Mr. Wallace answered: “I’ve written a lot about that. But one thing I mean is a mixed economy—as much corporative, small business, cooperative and government ownership as will produce the goods. I wouldn't allow strikes in government-owned industries; we’ve got to find some better way.” (Politics, March-April, 1947.) These are indeed fine words for a man who, in the opinion of the Daily Worker “represents the democratic aspirations of millions,” but the Communist Party always have had their private definition of “ democracy.”

So we can see that Mr. Wallace certainly does not stand for Socialism and the interests of the working class. When, during the thirties, he was Secretary for Agriculture he showed himself to be the friend of the large farmers. Incidentally, both Mr. Wallace’s father and grandfather were large-scale farmers. When the economic crisis broke out in the United States in 1929 agriculture was hit even worse than industry. Even during the “prosperous” twenties agriculture was worse off than industry. The farmer had to sell his commodities at low prices and buy manufactured commodities at high prices. Therefore when Mr. Wallace became Secretary for Agriculture his aim was to raise agricultural prices. In the words of Mr. George Peek, the first administrator of the Agriculture Adjustment Administration, “the sole aim and object of this Act is to raise prices.” The Act which Mr. Peek was referring to was the Farm Relief Act (12/5/33). This Act was in two parts. The first part set up the A.A.A. This gave substantial payment to farmers on condition that they destroyed and restricted their production of all the basic farm crops and products in accordance with the proposals of the Department of Agriculture. The second part of the Act was the Farm Credit Administration which allowed farmers loans at low interest to pay off their existing mortgages. As can be seen this Act by Mr. Wallace and the New Dealers had no benefits for the working class or the thirteen million people in tenant farm families or the three million in sharecropping families. The Act only helped the owners of land. In fact it brought about a greater concentration of ownership and reduced many of the tenant farmers to mere wage-labourers.

Therefore it is apparent that whatever may be the result of the presidential election in the United States the working class will be in the same predicament— wage labourers. The workers of the United States and the rest of the world will not arrive in Easy Street by giving their allegiance to politicians of the calibre of Mr. Henry Wallace. What the workers must do in every country of the world is to form Socialist Parties whose only object is the common ownership and democratic control of the means of producing and distributing wealth. The only party in the United States worthy of working class support is the Workers’ Socialist Party (companion party of the S.P.G.B.).

Those supporters of Wallace who call themselves Communists should recall the words of Marx in the Address of the Central Council to the Communist League:

   “But they themselves will have to do the most for their final victory by becoming enlightened as to their class interests, by taking up their own independent party position as soon as possible and by not allowing themselves for a single moment to be led astray from the independent organisations of the party of the proletariat by the hypocritical phrases of the democratic petty bourgeois.” (Karl Marx, “ Selected Works,” Vol. 2. Published by Lawrence & Wishart. P.168.)

G. Clark