Letter: "True' Socialism from France (1980)

Letter to the Editors from the August 1980 issue of the Socialist Standard

"True' Socialism from France

To the Editors

I read with pleasure that the Socialist Standard had discovered our untiring efforts to show how socialism could be created and live. But I think it is good that all readers learn that ALB’s article, published in February, contains some serious mistakes or misunderstandings.

“Consumption vouchers” and, far more, “labour vouchers” are inapt words to describe the social income, as they contain an idea of scarcity. They have been used in war conditions, when you were given vouchers to get only 100g of bread a day; but they are not appropriate to Jacques Duboin’s consumption money, which has to be proportional to an abundant production. As there is no better word than the capitalist word of “money”, we keep this notion for other reasons: it shows that your income gives you the complete choice of what you think you need. The dealers have to keep accounts to allow the consumers to decide whether production has to be increased or not. (Do not forget that without profit there is no more advertising and ail its consequent misleading choices.) The necessity of keeping pseudo-prices, at least at the beginning, results not only from the desire to avoid wastage (a danger that will decrease as the sense of individual responsibility increases) but also from the fact that the consumer must be informed about the remaining difficulty to achieve what he wishes — about the raw material this production requires, its effect on the environment and the pollution it involves. No good choice may be made unless you have the most complete information and price is a good and rapid means to supply it. The most important thing you must emphasize about consumption money is that it cannot carry an interest, cannot be hoarded or loaned, and that it loses its value when it has been used once. This pseudo-money, then, has nothing to do with capitalist money in that it puts an end to that awful law which tells that “money goes to money”, widening the gap between rich and poor. This is the absolute condition without which socialism cannot live. He who calls himself a socialist and does not realise this necessity is a dreamer (remember Allende).

Free access to goods as well as worldwide socialism are our final aims, but we claim that a period of adaptation is necessary during which people’s mentalities will progress more and more rapidly as they will be free from the “prices-wages-profits” economy. Do not forget that J.Duboin was a convinced world citizen, as I and many of his followers. But if we could convince our neighbours and set up the true socialism in France, why not try? Is it not the best way to convince the others and achieve world-wide socialism?

ALB blames my father (he uses the word “mistake”) for exaggerating the impact of mechanisation and automation on employment under capitalism. This impact, nevertheless, appears easily when you look at the official data: in any western country and for several decades it has appeared obvious that production increases while employment decreases. This is the reason why he stated that income must become independent of labour. And production can now be realised with fewer and fewer workers. Evidence of this is given by the drift of labour from the first to the second sector, then from the second to the third, while the production of each sector has kept increasing. Productivity in the third sector is about to be boosted in the coming years as a result of computerization. It must overall be kept in mind that official statistics will take into account all useless, nay harmful jobs that the capitalist consumption society has created.

The most surprising criticism published by the Socialist Standard is that Duboin made a mistake in “accepting the myth that banks can create credit”. It is no longer possible, for socialists, to ignore a fact of so important consequences. May one forget where the power is? If there were some naive readers who had to be convinced, let the answer come from the House of Commons, that had appointed a committee to report on this affair; this gave Mr.McKenna. Chairman of the Midland Bank, the opportunity to declare: “Banks create deposits, but I am afraid that the man in the street should not be happy to learn that banks create and destroy money, yet this is the truth”. Let now the Governor of the National Bank of Canada state during an official inquiry: “It is the very office of banks to make money, exactly as steelmills make steel”. Colin Clark, an Australian economist and financial adviser to the Queensland government wrote: “In business circles, one could still find people trying to deny that banks create or destroy credits; I doubt however that those people could find one single genuine economist to share in this strange point of view”. If all this were not sufficient, just have a look at the Encyclopedia Brittanica (1954 edition volume III, p50) where you will read that: “Banks do not lend their money, nor their customers money: they create credits as deposits on which their customers may draw checks”. Do not forget that J. Duboin had been a junior Minister, in charge of the French Treasury; this gave him the opportunity to measure the power of banks. From this knowledge he could predict how dangerous this power would be if socialism ignored or tolerated it. World-wide Socialists cannot afford to make such a mistake.

As our aims seem really to be much the same, I would sincerely be happy if this could help to achieve our common purpose. As I have endeavoured to continue, chiefly through the publication of his newspaper, my father’s fight since his death (which occurred not in 1973 but in March 1976 at nearly 98), I do wish there will be the best mutual understanding between writers and readers of the Socialist Standard and those of La Grande Releve. 

Marie-Louise Duboin

Le Vesinet, France

Reply:

M-L Duboin’s letter unintentionally confirms the point we were trying to make in the article she criticises: that, in the movement inspired by the ideas of her father, mixed up with the correct insight that the “prices-wages-profits” system must be abolished are all sorts of confused views, often bordering on currency crankism.

1. She objects to us saying that what her father called “consumption money” would better have been called “consumption vouchers”. She feels that this latter term suggests too much the ration cards of the war and immediate postwar period. Not necessarily. Even the “labour-time vouchers” Marx mentioned would have been “proportional to an abundant production” and would have allowed the individual a free choice of the various goods available for personal consumption. But this is not the real point. Under both the system mentioned by Marx and that proposed by Duboin, individual consumption would still be rationed, being restricted by the number of vouchers a person had. Our point is that today, given the tremendous development of the means of production since Marx’s time, society could, on the basis of common ownership and democratic control, apply the long-standing socialist principle “from each according to his ability, to each according to his needs”; in other words, institute free access to goods and services according to individual need.

2. M-L Duboin argues against the immediate introduction of free access on the ground that people are not yet ready for it. “A period of adaption is necessary”, she claims, “during which people’s mentalities will progress”. What exactly does she mean here? Can this be the old objection that, if goods were free, people would grab more than they needed so that shortages would soon re-appear? If so, it is a peculiar objection from someone claiming to stand for a society of abundance. We don’t think this problem would arise because, if people can be assured (as they will be able to be) that the stores will always be adequately stocked with what they need, then there is no point in grabbing or hoarding. To do so would be to behave in a quite abnormal way. Grabbing is a product of scarcity and insecurity, not of abundance. In any event, socialism is not something that will be introduced from above for a population which will not know what to expect; it is something that will have been introduced by a majority which wants it and understands its implications. A “sense of individual responsibility” will thus already have developed before socialism is established.

3. We don’t really see the relevance of the reference to Allende. Perhaps M-L Duboin is trying to say that his fate is a warning as to what awaits anyone who tries to introduce “socialism” while retaining the present monetary system. But Allende was not a socialist, nor was he trying to introduce socialism. He was a reformist trying to extend State capitalism in Chile. His experience is thus irrelevant as far as the establishment of socialism is concerned, though of course we agree that socialism cannot be established without abolishing money.

4. Socialism cannot be established just in France or just in Britain or in any one country alone for the simple reason that capitalism, the system socialism will replace, is already a world system. The developed means of production which make possible a society of abundance only exist on a world scale and as an integrated world-wide network. A society of abundance in one country is therefore just not possible.

5. We did not say that the trend referred to by Jacques Duboin for machines to replace living labour does not exist, but only that he tended to exaggerate it. When he says, for instance, in his Economie distributive de l'abondance that “hundreds of examples could be given of a machine replacing 10, 50, 100 and often more workers” (3rd edition, 1946, p.16), this is misleading. If you just look, as Duboin is doing here, at the labour displaced at the last stage of the production of a particular commodity by the introduction of a new machine, then you get a one-sided picture. For the labour displaced at this stage will have only been made possible by the extra labour employed in earlier stages to design, construct, install and maintain the new machine. There is of course an overall displacement of living labour but of the order of a few percent and not of the fantastic figures sometimes found in Duboinist literature (and, to be quite frank, sometimes too in our own!). A further reason why overall productivity only increases at a relatively slow rate is that a new invention is never applied in one fell swoop in all the workplaces producing a particular commodity, but only slowly as competition gradually forces all the producers to adopt it. We hasten to add that we fully accept that in socialism, where the profit and labour-cost considerations that apply under capitalism will no longer exist, mechanisation and automation will really come into their own as means, not only of producing abundance, but of eliminating dull, boring, repetitive and dirty jobs.

6. Duboin thinks that her belief about the banks’ supposed power to “create deposits” must be regarded as proved because certain individuals she names have said so, notably the members of the MacMillan Committee 1931 (Committee on Finance and Industry). What she fails to realise is that, for every “authority” she quotes supporting her belief, there is another denying it.

Thus she quotes the Governor of the National Bank of Canada. But Mr. Jackson Dodds, the General Manager of the Bank of Montreal, retorted: “Now, banks are given well defined powers under the Bank Act, but the power to create something out of nothing is not one of them.” She quotes Colin Clark as saying that he knew of “no genuine economist” who denied it. Edwin Cannan, Emeritus Professor of Political Economy in the University of London provided an argued case against the belief. (An Economist’s Protest by Edwin Cannan, pages 256-266). As also did Professor Gregory, who was a member of the MacMillan Committee. Then there was Mr. Walter Leaf, Chairman of the Westminster Bank and President of the Institute of Bankers:

“The banks can lend no more than they can borrow—in fact not nearly so much. If anyone in the deposit banking system can be called a ‘creator of credit’ it is the depositor; for the banks are strictly limited in their lending operations by the amount which the depositor thinks fit to leave with them."

Duboin quotes in support of her belief Reginald McKenna, who was a member of the MacMillan Committee. When Major Douglas, founder of the Social Credit movement drew from that Committee’s report the quite logical conclusion that it meant that “new money has been created by a stroke of the pen”, McKenna wrote: “There is nothing to justify the claim by Major Douglas that I agree with his view on the creation of credit”.

What Duboin should do is to examine critically the astonishing case put by the MacMillan Report on para. 74. It was blatantly rigged. It worked out a series of ten successive loans to depositors, extending over a considerable period, but while it assumed the deposit of cash by a depositor, no depositor or borrower in their Alice in Wonderland bank ever withdrew cash. Duboin really should not go on believing that the fact that a committee is government appointed is a guarantee that it won’t utter nonsense. Incidentally, when members of the Committee were approached about para. 74, several of them disowned it.

M-L Duboin can rest assured. Socialism will neither “ignore” nor “tolerate” the banks. Together with the rest of the paraphernalia of buying and selling, they will quite simply not exist in Socialism. We combat mistaken ideas about mythical powers supposedly possessed by banks because they lead people to imagine that the solution to social problems lies in monetary reform rather than a change in the basis of society.

Editorial Committee

Letter From Europe: The French movement for abundance (1980)

The Letter From Europe column from the February 1980 issue of the Socialist Standard

In France, before and just after the last world war, a group known as the Mouvement Français pour I’Abondance (MFA) enjoyed some success, to such an extent that its theories are now referred to in most French dictionaries under the word abondance. The key figure in this movement, which still exists today though divided into a number of rival groups, was Jacques Duboin. Born in 1878 he had briefly been a junior Minister and a Radical Deputy in the 1920s. The slump which followed the 1929 Crash, however, set him thinking about economic and social matters and led him to elaborate a “theory of abundance”, first sketched in La Grande Releve des Hommes par la Machine in 1932, and to found a movement which after the war became the MFA.

According to Duboin, the 1930s slump represented the coming of abundance which capitalism, being based on the exchange of goods for profit, could not cope with since only goods which werc scarce had an exchange value and so were exchangeable. Abundance. Duboin taught, kills profits; which explained why capitalism had to try to suppress abundance in order to survive.

To give the flavour of the MFA analysis we translate below some passages from their pamphlets:

   In this regime [capitalism] which rests on exchange, the means of production are private property. Their owners draw a profit from them by selling what is produced at the highest price competition permits. People who possess nothing sell their labour as dearly as competition permits, and get wages, salaries or fees which allow them to buy what they need to live.
   It is clear that such a regime cannot exist with abundance since this suppresses profit. In fact, only products and services which have some value can be sold. But only scarce products keep their value and sell at a profit. Abundant products have no value: they are given and taken; they are not sold . . . It is thus a truism to say that abundance does not exist: it will never exist in the capitalist regime since production is not motivated by the desire to satisfy consumption but by that of realising a profit. When this profit becomes impossible, production stops. It is then said that there is a crisis, even if many consumers lack the bare necessities (Duboin, Economic Distributive de l'Abondance, 1946).          The magnificent scientific achievements of the 20th century have made abundance appear in all the industrialised countries, upsetting their economies from top to bottom, since these can only function with a “scarcity" of products and services. This obviously requires explanation: At the present time money is almost as indispensable to existence as air to the lungs. But money doesn’t fall from heaven; it is production as a whole which distributes it in the form of wages and profits. The pursuit of money being thus at the centre of our concerns, we do not grow corn to have corn, but to have money; for if we don’t gain any money then we don’t sow any more corn. Similarly all other agricultural, commercial and industrial enterprises are only viable to the extent that they succeed in bringing into their tills more money than they pay out. When abundance appears, workers are sacked since there is no more work to give them. But they then don’t buy the products and these, remaining at the charge of the producers. make their profits disappear: he who can't buy ruins him who wants to sell! People then complain about “overproduction", for this is what everything that cannot be sold is called. But chronic overproduction, is that not abundance? So goods are not produced in abundance quite simply because they would not be able to be sold (Bombe “H” ou economie distributive, 1958).

The first paragraph of these extracts contains some serious mistakes; on some points the analysis as a whole comes very near to currency crank theories like Social Credit, and in many ways Duboin can be seen as a French equivalent of Major Douglas. His solution to the problem of distribution, however, was different and more interesting. The exchange economy, said Duboin, must be replaced by an economy in which wealth is no longer produced to be exchanged but is produced instead simply in order to be distributed to human beings to satisfy their needs. This new economic system he variously called l'economie distributive (the distribution economy), le socialisme de I'abondance and le socialisme distributif.

Under this system the means for producing wealth were to cease to be the private property of individuals and to become the common heritage of all the members of society; the wages system was to be replaced by a “social service” in which every able-bodied person would work for a certain period in order to help produce an abundance of wealth; finally, every member of society would be credited, from the cradle to the grave, with a “social income” in the form of a monnaie de consommation (consumption money) which would be equal for those in equal circumstances and which would enable them to draw what they needed from the common store of goods set aside for individual consumption.

We will once again quote from “abundancist" writers to show the extent of their opposition to exchange:

   It should not be necessary to think very deeply to understand that from the moment when production has become the property of society as a whole, the economic process can no longer be carried out by a series of exchanges (which imply individual or group property of the products exchanged) but only by allocation (or distribution) (Pour batir le socialisme. Perspectives Syndicalistes. 1969).
   Socialism . . .  still calls for “the socialisation of the means of production and exchange". For the means of production they are right. But as far as the means of exchange are concerned, they are behind the times and unconsciously play the game of the capitalism they are fighting against by accepting to present the problem in the same terms as it. The real objective to pursue is “the socialisation of the means of production and the replacing of the means of exchange by means of distribution".

(Gustave Rodrigues, Le Droit a la vie, 1936 edition, p.108.)

This “distribution economy” described by Duboin in fact had more in common with the utopia described in Edward Bellamy’s Looking Backward (1888) than with Douglas’ Social Credit. But his proposal for “consumption money” attracted support from the same sort of people as in other countries supported Social Credit. There is however a difference. Major Douglas envisaged giving everybody a “social dividend” within capitalism; Duboin, on the other hand, assumes the abolition of exchange so that “consumption money" is a misnomer, especially as Duboin made it clear that this so-called “money” could only be used once and so would not circulate. Strictly speaking then, it would not be “money”at all but something similar to the “labour-time vouchers” which Marx once envisaged as possibly necessary in a very early stage of socialism. In fact “consumption voucher" would be a better term for what Duboin had in mind.

Any system of vouchers — and this applies to the labour-time vouchers mentioned by Marx as well implies as a counterpart that the goods for distribution have pseudo-prices. Under the labour-time voucher system these pseudo-prices were to be related to the time spent in producing particular goods. Under Duboin’s system they were to depend on how scarce a particular good was, holding out the prospect that, as abundance came more and more to be realised, goods would become “cheaper" and “cheaper", (able to be acquired by smaller and smaller numbers of vouchers) and eventually free. Indeed Duboin proposed that some services such as heating, lighting, transport, telephones and health treatment should be free from the start. Thus, as with Marx, so for Duboin the end to be achieved was the full application of the principle “from each according to their ability, to each according to their needs”—free access to goods and services according to what the individual person judges he or she needs.

If Marx, writing in 1875, may have had a case for saying that unrestricted free access to goods and services could not have been introduced immediately had socialism been then established, the same cannot be said of Duboin and his followers in the 1930s and certainly not today (Duboin died in 1973, at the age of 95). In fact there is something odd about a group calling itself “the movement for abundance" yet not proposing full free access as something that could be realised very rapidly. As we have pointed out in our comments on labour-time vouchers (see, for instance, Socialist Standard, April 1971), the fantastic development of the means of production in the twentieth century has made any system of rationing, however generous the rations, quite obsolete. This applies to labour-time vouchers as well as Duboin’s “consumption money’’. A consistent “abundancist” today can only be in favour of free access, of goods being freely available for people to take according to need from the abundance which is technologically possible now but which will only becoming socially possible once capitalism has been replaced by socialism.

The MFA is open to criticism on other grounds too. Duboin was an underconsumptionist who greatly exaggerated the impact of mechanisation and automation on employment under capitalism. He just looked at the labour displaced in the final stage of the production process while neglecting the extra labour required at earlier stages to invent and build the new machines. Certainly, the former is greater than the latter — otherwise the new machinery would not be introduced — but as a matter of observed fact productivity in manufacturing industry increases on average at the comparatively slow rate of 2 or 3 per cent a year, and certainly not at the fantastic rates sometimes implied by Duboin. But Duboin was not original in making this mistake, nor in making another in accepting the myth that banks can “create credit" whereas in fact they can do no more than lend what has been deposited with them.

The MFA also argues, sometimes quite vehemently, that its “distribution economy” could be established in just one country, preferably France. The arguments it uses to defend this view show that it has not fully understood what socialism is even if it has understood the need to abolish what it calls “the prices-wages-profits system". As the productive apparatus capable of producing an abundance of wealth is world-wide, it is clear that abundance can only be realised on a world scale and that socialism, the society that will permit its realisation, can only be world-wide too. Indeed at times the picture the MFA paints of what it calls socialism more resembles state capitalism. At one time in fact (when Russia was more popular than it is now) the MFA used to describe Russia as "scarcity socialism", though most French “abundancists" would not. Most French “abundancists" would now agree that the Russian system is a form of state capitalism.

What is interesting in all this is that, virtually unknown to us in the English- speaking world, a group of people in France came to the conclusion that the solution to todays social problems necessarily involves abolishing the exchange economy and the wages-prices-profits system, even if this insight was mixed up with all sorts of confused and incorrect ideas. It once again confirms that the spread of socialist ideas does not depend entirely on our own meagre propaganda effort.

Adam Buick (Luxemburg)