Rear View: It’s not rocket science (2021)

The Rear View Column from the September 2021 issue of the Socialist Standard

It’s not rocket science

Following his trip to the edge of space, billionaire Branson asked us to ‘Imagine a world where people of all ages, all backgrounds from anywhere, of any gender, or any ethnicity, have equal access to space’ (free-media.info, 18 July). Indeed. Iain M Banks’s Culture series is a highly recommended imagining of such a post-capitalist/scarcity society. But to get there, we need to abolish capitalism on Earth. We could make a start by understanding where one-time Democratic Party Ohio State Senator, Assistant Professor Nina Turner, errs. She recently criticised billionaire Bezos who, following his first rocket trip, said ‘I also want to thank every Amazon employee and every Amazon customer because you guys paid for all of this.’ But the ‘Blessed By God! Wife, Mother, Sister, Host of Hello Somebody Podcast, Ohio State Senator, Professor’ @ninaturner (20 July) disagrees: ‘Correction: employees didn’t pay for this — their wages were stolen to pay for a billionaire’s space vacation. Jeff Bezos can thank his workers by treating them with dignity and paying them fair wages….and he can thank us all by paying his damn taxes.’ Oh no, not again – a call for ‘fair’ wages and taxation! There is nothing fair about wage slavery. We work, they take and do their best to avoid paying taxes which serve to maintain this system of legalised robbery. On 25 July Turner tweeted to remind us that the Federal minimum wage of $7.25 has remained unchanged since 2009. An earlier re-tweet proclaims, correctly, another world is possible. She, unlike Marx, fails to join the dots. He wanted us to understand that, with all the miseries it imposes upon us, the present system simultaneously engenders the material conditions and the social forms necessary for an economical reconstruction of society. Instead of the conservative motto: ‘A fair day’s wage for a fair day’s work’ we ought to inscribe on our banner the revolutionary watchword: ‘Abolition of the wages system’.

A Professor of the dismal science

‘If the Socialist Party of Great Britain is an authority on such things, it is official: in light of recent anti-communist protests and civil unrest, Cuba has been demoted to “Not Real Socialism” and reclassified, along with the USSR and other failed socialist experiments, as “actually state capitalism”’ (independent.org, 20 July). The author of this ahistorical drivel is Art Carden, an Associate Professor of Economics at Samford University. For the record, in the December 1906 edition of the Socialist Standard we stated: ‘We are not concerned with State capitalism. We are concerned with Socialism. Socialism is the negation of capitalism. Consequently State capitalism cannot be the ideal of any Socialist. Ergo those who preach State capitalism or collective exploitation are not Socialists.’ Further, we said Russia had state capitalism in 1920 and similarly Cuba in 1968. Ironically, the island’s present dictator made a speech recently (liberationnews.org, 11 July) that was surprisingly succinct and free from mention of communism or socialism! This did not deter the loony left, eg. workers.org, from proclaining ‘U.S. HANDS OFF CUBA! END THE BLOCKADE! DEFEND SOCIALIST CUBA!’ or the rabid right from declaring ‘Cuba is a tragic case, but it is not our problem…. Except for China and North Korea, after the fall of the Soviet Union communist regimes have all ultimately collapsed ‘(vdare.com, 19 July). Even the moribund middle contributed: e.g. ‘Biden Says Communism Is A ‘Universally Failed System,’ And Socialism Is No ‘Useful Substitute’” (dailycaller.com, 15 July).

Doctor in need of a second opinion

Another professor, Jody Rawles, M.D., writes: ‘Homelesssness is complex… Anybody claiming to have a plan to fix this problem with only one remedy is like a mechanic claiming to be able to overhaul your engine with only one tool — it won’t work’ (yahoo.com, 20 July). Yes, homelessness is a complex issue. For every homeless person there is a raft of interrelated reasons why they may be in that situation. Some are simple: loss of housing through relationship breakdowns, inability to pay for housing, drink, drugs, mental health issues, abuse and domestic violence. For some, all they really need is a house or flat. For others, more complex social help is required from specialists perhaps in drink and drug rehabilitation, or social workers to support individuals through crises. The US-based professor of psychiatry and human behaviour recognizes that individual human needs can be complex as well as unique, but he is clearly igmorant that we are existing in a sick social system which responds only to market rather than human needs. Consider, there are on any given night over 500,000 homeless in the US alongside over 17 million vacant homes. The Ending Homelessness Act of 2019 which provides additional funding for, and otherwise addresses, assistance to homeless individuals and families will fail. There is in fact a housing shortage for those most in need. Nearly 150 years ago Frederick Engels wrote: ‘This shortage is not something peculiar to the present; it is not even one of the sufferings peculiar to the modern proletariat in contradistinction to all earlier oppressed classes. On the contrary, all oppressed classes in all periods suffered more or less uniformly from it.’ Engels saw that there was no possibility of a rational approach to housing within capitalism. ‘As long as the capitalist mode of production continues to exist, it is folly to hope for an isolated solution of the housing question or of any other social question affecting the fate of the workers. The solution lies in the abolition of the capitalist mode of production and the appropriation of all the means of life and labour by the working class itself’ (The Housing Question, 1872).

Inequality Kills (2022)

From the March 2022 issue of the Socialist Standard

January 2022 saw the release of Oxfam’s report, provocatively entitled Inequality Kills. Produced to ‘inform public debate on development and humanitarian policy issues’, the report focused on three broad areas: 1) The unprecedented rise in billionaire wealth during Covid-19, 2) Economic Violence (the impact of inequalities in health, gender-based violence, climate change and hunger) and 3) Solutions (importance of social movements, and policies around pre-distribution and re-distribution).

Although likely using inflammatory language for dramatic effect, Inequality Kills is comprehensive and includes multiple, detailed and scientifically researched sources of information. Sixty pages and 321 footnotes are accompanied by a summary and a note on methodology describing how the organisation came to their conclusions and how they decided upon what to highlight and what questions should be asked.

Their message is that we are making an unequal world even more unequal and that the pandemic has pushed us into a yet more grave position regarding environmental damage, a decrease in women’s rights, an increase in gender inequalities and more barriers for ‘racialised groups’.

The forewords feature comment from Jayati Ghosh, a development economist and Professor of Economics at the University of Massachusetts at Amherst, USA, but possibly more strikingly, Abigail Disney, a member of the multinational entertainment and media conglomerate family, who is described as a documentary filmmaker [and] activist and lets us know that ‘The answer to these complicated problems is ironically simple: taxes’ and ‘There is more than enough money to solve most of the world’s problems. It’s just being held in the hands of millionaires and billionaires who aren’t paying their fair share.’

As mentioned in the report, Abigail Disney is a member of the ‘Patriotic Millionaires’, an organisation that ‘focus[ses] on three “first” principles: a highly progressive tax system, a liveable minimum wage, and equal political representation for all citizens’ (p 5). Do Oxfam consider that both this organisation and the idea of philanthropy are useful to their position?

In Inequality Kills, a number of statistics are shown in bold, eye-catching infographics, such as the below.

The authors take a stab at the contemporary issue of the single person or business space-race and Jeff Bezos and his somewhat phallic rocket in particular, in a section entitled ‘The Billionaire Variant’ linking the pandemic to the rise in wealth of the richest on the planet.

‘In July 2021, the world’s richest man launched himself and his friends into space in his luxury rocket while millions were dying needlessly below him because they could not access vaccines or afford food. Jeff Bezos’ own iconic Marie Antoinette “let them eat cake” moment will forever be more accurately quoted: “I want to thank every Amazon employee and customer because you guys paid for all of this.” The increase in Bezos’ fortune alone during the pandemic could pay for everyone on earth to be safely vaccinated’ (pp 9-10).

There is scant mention, however, of how or why this situation came to be. How was it possible for a commercial trader, reminiscent of nineteenth century Britain, to increase his wealth in this way? What is the root cause of the problem? Does it take much discussion after reading the report or do we already know the answer? If we know the answer, what are the friends and associates of the wealthy capitalists going to do about it? By design, there are more questions than answers, but how helpful is this methodology?

The report is around 15,000 words long and the word ‘capitalism’ only appears twice, with one of these referring to ‘shareholder capitalism’; the other appearing in a section entitled ‘Economic Violence’:

‘That people in poverty, women and girls, and racialized groups are so often disproportionately killed or harmed, more than those who are rich and privileged, is not an accidental error in today’s dominant form of capitalism, but a core part of it’ (p.12).

The report does not explain what today’s dominant form of capitalism is, so how are we to discuss how to improve or solve it?

A cursory search of various social media platforms show that the report is only mentioned by groups linked to Oxfam itself, with a focus on the amount of billionaires compared to poorer people from an Indian perspective, and by ‘green’ groups and relatively small-reach left-leaning individuals and ‘think tanks’. Features can be found in The Morning Star and Socialist Worker.

It now does not take much searching to find that even the ‘centre-left’ of mainstream politics has woken up to the idea that capitalism is in itself and is the instigator of, damage by design. Foreign Affairs Magazine, published by the US Council on Foreign Relations, was founded essentially as a ‘sister’ of Chatham House in Britain and has close links to the Democratic Party. They state that their ‘goal is to start a conversation about the need for Americans to better understand the world’. Their 2013 article, Capitalism and Inequality, What the Right and the Left Get Wrong describes the problem at hand: ‘Inequality is an inevitable product of capitalist activity, and expanding equality of opportunity only increases it.’

The authors would also have done well to closely read Bambra, Lynch and Smith’s The Unequal Pandemic, published in January 2021, which describes how pandemic-based and other outstanding ‘inequalities are a political choice: with governments effectively choosing who lives and who dies.’ Oxfam’s report may not be able to change this ever-pervasive fact, even if it was their original aim.

So who is the report for really? Are the people that need to discuss the issues raised, going to act on them? Perhaps the most pertinent quote in the report comes from Greta Thunberg, made at the latest pre-COP26 Youth Summit:

‘The climate crisis is of course only a symptom of a much larger crisis. A crisis based on the idea that some people are worth more than others (…]) It is very naïve to believe that we can solve this crisis without confronting the roots of it’ (p.34).

TJ

Cooking the Books: Unfair Shares (2022)

The Cooking the Books Column from the February 2022 issue of the Socialist Standard

‘The world’s 10 richest people added $402 billion to their fortunes in 2021’, CNBC reported on 30 December. ‘They were led by Tesla CEO Elon Musk, who this year became the world’s richest man and briefly saw his net worth top $300 billion. He added $121 billion to his net worth in 2021 — just shy of the $140 billion he added in 2020’ (tinyurl.com/2p9fctc5).

This way of putting it is misleading, though not as bad as saying that these multibillionaires ‘earned’ it. Musk did nothing to add to his ‘net worth’. It just got added as the market price of the shares he owns in Tesla and other companies happened to increase by the end of 2021 compared to what it had been at the beginning. The increase doesn’t necessarily even represent any increase in real wealth as it does not correspond to an increase in anything useful made from materials that originally came from nature.

The Independent (13 October), carried an article, ‘How much does Jeff Bezos make per minute?’ It distinguished between his income and his ‘net worth’ and calculated his total income as $1,691,840 a year, or $3.20 a minute. This is the money Bezos, then the richest man in the world, had in 2020 to spend on his personal luxuries such as a space trip or to invest. The increase in his net worth, however, was calculated as $75 billion, or $142,667 a minute, over 44 times as much (tinyurl.com/a3caa726). Musk’s income in 2020, at $595 million, was rather more but still only a fraction of the $140 billion his net worth increased by that year.

As an individual’s net worth is calculated by multiplying the number of shares they hold by their current market price, what we are talking about here is an increase in the price of the shares these multibillionaires own. A share is principally a claim on the future profits on the capital invested by the business concerned, or, as Marx put it, ‘merely a title of ownership to a corresponding portion of the surplus value realised by it.’

The market price of a share is the income as profit that it is expected to bring, converted into a capital sum. This is brought about by the play of supply and demand on the stock exchange, with demand influenced by possible future profits and so includes a large element of speculation. Marx called the capital sum resulting from converting future profits in this way ‘fictitious capital’, fictitious in the sense that it did not simply represent actual capital invested in exploiting wage-labour for surplus value. It principally represented claims on future wealth; in other words, on wealth that does not exist as yet:

‘Even when the promissory note — the security — does not represent a purely fictitious capital, as it does in the case of state debts, the capital-value of such paper is nevertheless wholly illusory’ (Capital, Vol. 3, ch. 29).

What is ‘illusory’ is not the legal title to a future income stream from surplus value nor its worth, but that the market price of shares represents real wealth in addition to the net value of the capital in the enterprise; even more illusory is the idea that an increase in the market price of these legal titles represents an increase in wealth.

If all stocks, shares and bonds were to disappear the amount of wealth in the world, that is, wealth that can be consumed or used to produce more wealth, would be quite unchanged. Which is what will happen in socialism where the commonly owned means and instruments of production will be used to directly satisfy people’s needs rather than as today to yield a profit.