Cooking the Books: Lord Desai’s retort (2025)

The Cooking the Books column from the September 2025 issue of the Socialist Standard

The Times’s obituary (4 August) of the economist Lord Desai who died at the end of July recounted the following anecdote:

' “Marx wasn’t against home ownership. In fact he owned his own house,” Desai insisted when challenged about his own two properties. What Marx was against, he added, was using property to exploit workers. “Marx had no objection to the ownership of consumer durables”.’

The person who challenged him was being silly as nobody can seriously think that the ‘common ownership’ and ‘abolition of private property’ that socialists such as Marx advocated meant the common ownership of personal possessions. As Desai pointed out, Marx was objecting to the ownership and use of productive resources to exploit workers by the owners appropriating as theirs a portion of what workers produced.

As the Communist Manifesto put it:

‘The distinguishing feature of Communism is not the abolition of property generally, but the abolition of bourgeois property. (…) Communism deprives no man of the power to appropriate the products of society; all that it does is to deprive him of the power to subjugate the labour of others by means of such appropriations’.

As a lecturer and author of a number of books on Marxian economics (even if he didn’t really agree with them), Desai could also have referred his challenger to the passage at the end of the penultimate chapter of volume I of Capital:

‘The capitalist mode of appropriation, the result of the capitalist mode of production, produces capitalist private property. This is the first negation of individual private property, as founded on the labour of the proprietor. But capitalist production begets, with the inexorability of a law of Nature, its own negation. It is the negation of negation. This does not re-establish private property for the producer, but gives him individual property based on the acquisition of the capitalist era: ie, on cooperation and the possession in common of the land and of the means of production’.

In other words, socialism (or communism, the same thing) means that everybody would be able to ‘appropriate products of society’ as their ‘individual property’ to use or consume. Everybody would be able to take from or make use of what society had produced, according to their individual needs.

Actually, ‘property’ is probably not the best word here. Individual ‘possession’ would be better. ‘Property’ is a legal as well as a sociological concept and it can be doubted that a socialist society would need a formal system of regulation to protect what one person had taken from society for their use from being taken by somebody else. After all, why would somebody want to take someone else’s food or clothes or mobile phone or whatever, when they could simply go and get it from a distribution centre or order over the internet? It is also possible to imagine that people wouldn’t need to possess a whole range of consumer durables but could borrow them when needed from a local tool library.

Housing raises a different question, if only because people normally want to use the same living place for decades. Today, a house or flat, for those who own or who are buying one, is not simply a personal possession that they use but also a financial asset. Obviously that aspect, and so the sort of individual legal ownership we know today, would not exist in socialism. Everybody would be guaranteed an exclusive place to live in for as long as needed but we can imagine it being more like ‘usufruct’ as the agreed exclusive ‘right to use and benefit from a property’ without owning it.

Letters: Karl Marx and Russia (2003)

Letters to the Editors from the April 2003 issue of the Socialist Standard

Karl Marx and Russia

Dear Editors,

I would like to discuss the issue of “the necessity for capitalism to have been achieved for socialism to occur” (“Desai on Marx”, Socialist Standard, November 2002).

Desai suggests that Russian Communism was wrong to use the principles of Marx being as Russia was a backward country. Then he goes on to suggest that Russian Communism developed a capitalist economic model as it developed the Russian economy and industries. What could be wrong about the development of a backward country under socialist principles? What would socialism look like if it only ever occurred in capitalist countries?

Desai appears to suggest that only an economically wealthy country, developed through capitalism can support a socialist system. Does he mean to say that socialism, should it succeed, should stagnate and decay as it devours the capitalist system of economics of its predecessors. A progressive, organised socialist party should enable economic growth to sustain socialism within one country but also to develop new industry and technology under its guiding principles. How is it possible to totally eradicate capitalist consciousness when socialism is developed that relies heavily on its economic principles for stability?

Socialist policies should inform the new methods of economics and seek to build a set of new socialist methods of production, in short a socialist economy based on Marx. This is not merely a question of graduated taxes, but a fairer system with a socialist aim, and cultural and aesthetic values that reflect the working class and encapsulates socialism.

Marx states that socialism should occur out of a capitalist economy because he thought that the working class were the intrinsic factor in a communist revolution; and the working class were common to developed countries under capitalism.

If socialism is to succeed, the party must win the support of the working class who desire to see an end to the current ideology of world capitalism.

In order to eradicate capitalism completely the Socialist Party must have a firm vision fixed in its mind, that by adhering to its principles, must revolutionise the consciousness of the people in areas of politics such as: economics, the environment, foreign policy and culture; in order to achieve power, not for a bureaucratic system (the fault of Russian Communism) but to achieve equality and fraternity among the working class.

G. Cubbage, 

Bolton, Lancs

Reply:

We define socialism as a society without private property, money, wages, nation states, where production is for use, not profit. In order for socialism to be successfully established, capitalism would need to develop industry to the point where a society of common ownership would be possible. Along with this, a modern working class would need to emerge that understands and desires socialism. It is clear that neither was the case in Russia in 1917. It was a predominantly agrarian country where the industrial working class were in a minority of the population.

It is true that Marx and Engels in the introduction of the 1882 Russian edition of the Communist Manifesto raised the possibility that Russia could, through an old system of common ownership of land maintained by the peasantry known as the Obshchina that existed in Russia at that time, could pass directly to socialism, without the necessity of developing the capitalist mode of production. However this could only be possible if the Russian revolution ignited a revolution in the West. This did not happen in 1917. Although working class uprisings did occur in the West, such as in Germany, they were more expressions of discontent arising from the First World War than a conscious desire to bring about socialism.

The Bolsheviks did not rise to power on a programme of genuine socialism, but to provide relief to a war-weary population and distribute land away from the large landowners to the peasantry. In fact, Lenin admitted that only state capitalism could be established in Russia at that time. As he wrote in The Chief Tasks of Our Times: “Reality says that State Capitalism would be a step forward for us; if we were able to bring about State Capitalism in a short time it would be a victory for us”. We also believe that the Leninist theories of the Bolshevik Party are prescriptions for state capitalism: the belief that socialism can only be brought about by a party of professional revolutionaries leading the working class and the establishment of a centralised state under the theory of so-called democratic centralism. We insist that the establishment of Socialism require the political actions of a socialist conscious working class without leaders.

Therefore, we agree with Lord Desai that only state capitalism could have emerged from the Russian Revolution. However, we part company with him when he insists that we need many more years of private capitalism to raise the level of society’s productive forces. We maintain that globally the size of society’s productive forces today would allow for the establishment of socialism.

Our definition of socialism above implies that it can only be established on a world-wide basis. Clearly a society where there is common ownership, money has been abolished and production is for human use cannot co-exist with countries where there is still private property, buying and selling and production for profit. Many of the measures that Marx and Engels outlined in the Communist Manifesto, including the call for graduated taxes, were based on the assumption that the working class would take power in Marx and Engels lifetimes. They would be necessary to develop the means of production to levels required for the establishment of socialism. However, since then, capitalism has done the job for us and there is no longer any need for these measures.

We can only agree with the last two paragraphs of your letter. If you study our object and declaration of principles, we hope that you agree that the Socialist Party fits the bill–Editors.

 

The urgent need for Socialism

Dear Editors,

Here we are, having finished the twentieth century which saw many advances in science and technology. Yet despite the potential to satisfy world-wide human need, there are still millions of people suffering from hunger and human misery. Unhappily our social organization has not changed in a way that would enable the human race to reap the full benefits of the useful advances—and abandon the harmful ones. Instead science and technology are commodities produced for sale and profit—they serve the needs of the market system. Presently the only access to the means of life is through money and for the majority this means employment of some kind. However, jobs only come when there is the prospect of profit. Also the standard by which men and women are judged is their material possessions. In every country a minority win out at the expense of the majority. Oh how apparent is the most urgent need for the Earth to belong to its entire people! Then, freed from the shackles which sale and profit places on human endeavour, there will be sufficient resources for everyone to have a satisfying way of life.

Justus Weijagye, 

Kabale, Uganda

 

Castle Breweries Kenya Limited

Dear Editors,

It was June last year when Castle Breweries Kenya Limited ceased its operations in the country. The company had been in operation in Kenya for only five years. A total of 1015 employees were affected by the closure. They, their children, families and relatives were left without any means of earning their daily what is famously called “bread”.

What led to the closure of the company is perhaps illustrative of how capitalism works. Castle Breweries had only one competitor—Kenya Breweries Limited. The South African company thus found it easy going at first but not so during the subsequent years.

Barley, an important ingredient in the manufacture of bee, is grown by a clique of farmers who are contracted by Kenya Breweries for their beer. Most of these farmers are either relatives or associates of senior officials of Kenya Breweries Limited. And thus any other person, or brewer for that matter, had to buy the barley at a higher cost. The only alternative is to import the barley. And this is what Castle Breweries used to do.

Since in its inception in Kenya, their idea or main motive was for profit making, Castle Breweries found it uneconomical to brew and sell its beer at the same price as the competitor, so the company vigorously campaigned for a tax waiver from the authorities.

Kenya Breweries, who had enjoyed monopoly for more than 70 years, found their existence being threatened and thus had to bribe the then President, Daniel Arap Moi. There was to be no tax waiver and in fact in his budget speech, the then Finance Minister Chris Obure increased the taxes on beer from 25 percent to 30 percent.

And thus Kenya Castle Breweries closed its brewing factory at Thika in June 2002 and went ahead at the same time to open others in the USA. The whole thing is Castle Breweries Limited had no intention of remaining in Kenya as long as there were no profits to be made. The welfare of the company’s 1015 employees was far from the concern of Castle’s ‘Bosses’.

The world will continue to witness cases of such nature as long as the so-called investors have only one goal when they are establishing their investments—profits. They go to any lengths to maximise profits and leave the conditions of those making the profits to be the same—Judas wages and salaries and slavery conditions of work.

We, the workers of the world, need to understand that no matter how much money you are paid, you’ll not be able to make ends meet because the wages or salaries are never commensurate to the profits made by the company, organisation or group you are working for. We need to know that the amount of time spent working for profits could be utilised elsewhere working for the welfare of the whole society. Our unity is vital and the capitalist way of doing things will end once we organise and work for the good of all. This will entail us going for political power and make it easy for capitalism to be replaced. Let’s unite to establish the system that caters for the needs of all the members of the society—Socialism.

Patrick W. Ndege,

Nairobi, Kenya

These Foolish Things: One World (1996)

The Scavenger column from the February 1996 issue of the Socialist Standard

One World 
  

“. . . A Brave New World is being created out there. Not, as one hoped, by one world idealists or UN diplomacy, but by the global corporations for the simplest of all reasons—profits. The state can either play along with them or have delusions of grandeur. The cost of delusions will be severe and will, be paid not by politicians but by the citizens.” Meghnad Desai, Professor of Economics, London School of Economics. Letter in the Guardian, 24 October 1995


Mine!

Over 100 million landmines have been laid in 64 countries. They are still being laid. Eight million old ones still lie buried. Five hundred people are being killed and injured by them every week. But mines are a very profitable product, so the likelihood of production and sales being halted in capitalism is rather small.


Top Gun
  

 “No amount of impassioned argument by lawyers and no predictions of the tragic human costs of possible conflicts can obscure the fact that international law simply does not prohibit per se the use of nuclear weapons.” Conrad Harper, legal adviser to the US State Department, said. The US held nuclear arms for self-defence and deterrence, he said. Reuters.


Up

Serious accidents in the mining industry are up by more than 28 percent, according to the first official figures since privatisation . . .  [At Thoresby] one worker died and seven were given hospital treatment after a huge outburst of oil and gas 1,000 feet underground. Guardian. 2 November 1995.


Down
  

 “I am one of the miners involved in the tragedy at Thoresby Colliery on October 12. Just 48 hours before the underground accident that killed Andrew Fielding, we were visited at the face by members of the management team and the safety engineer. We reported that the fumes gave us headaches, dizziness, nausea and some of our men were vomiting. The fumes were getting stronger each shift. The management’s attitude was that we would have to persevere. They told us: ‘The fumes are like dog shit—you might not like the smell, but it won’t hurt you.’ We were actually sent a bottle Olbas Oil to put into carbon masks to disguise the smell and 100 paracetamol tablets for our headaches . . . “ Peter Davies, letter in the Guardian, 2 November 1995.


Out

The report of the United Nations High Commission for Refugees (UNHCR), 15 November 1995, states that the number of refugees in the world being looked after by the Commission is now 27 million, but that contributions to the fund for improving their conditions are decreasing . . .


Social cancer

Booming sales of cigarettes to developing countries including China, Russia and Brazil have helped BAT Industries, Britain’s seventh biggest company, to record pre-tax profits of £1.8 billion in the nine months to the end of September.

BAT, whose brands include Lucky Strike, Kool, Kent and State Express 555, said the figures, up 22 percent on the same period last year, reflected an exceptional performance from its tobacco division. Guardian, 9 November 1995.

The Scavenger

The Scavenger thanks readers for items sent in. Regrets some will have to be held over to next month.

Capitalism and globalization (2002)

Book Review from the November 2002 issue of the Socialist Standard

Marx's Revenge – The Resurgence of Capitalism and the Death of Statist Socialism by Meghnad Desai (Verso Books)

Ever since the collapse of the USSR and the so-called “communist” regimes in Eastern Europe, many column inches have been written and words spoken proclaiming the triumph of capitalism and the demise of socialism. Karl Marx, we are told, has been thoroughly discredited and his theories have been consigned to the dustbin of history. The “End of History” had arrived.

Meghnad Desai, Professor at the London School of Economics and a Labour Peer, however, argues in his latest book Marx's Revenge – The Resurgence of Capitalism and the Death of Statist Socialism (Verso, 358 pages) that, far from discrediting Marx, the events of the last twenty years would have vindicated him. Not only would Marx not have supported the Eastern European regimes, but he would have welcomed their downfall. According to Desai, Marx argued that socialism could only be successfully established when society's productive capacity had been fully developed under capitalism. This was certainly not the case in Russia at the time of the Bolshevik Revolution in 1917. Desai, however, maintains that capitalism is still far from having reached its potential. Although, he entertains the possibility of genuine Marxian Socialism, he relegates it to a distant future.

Desai begins his investigation at the end of the eighteenth century when feudal society was giving way to industrial capitalism. Adam Smith was developing his theories on the historical or “stadial” progress of society, in which Smith considered the newly emerging free market capitalist society as the highest stage. Hegel was propounding his theory of dialectic: the idea that human society would develop greater awareness over time through a process of struggle. This sets the historical context in which Desai discusses Marx's political and economic ideas. He examines Marx's economic theories as set out in Capital and finds that they do not suggest that capitalism will inevitably collapse. On the contrary, capitalism could continue indefinitely. Even the 'Law of the Tendency of the Rate of Profit to Fall' as described in the third volume of Capital only suggests a long-term tendency, with countervailing tendencies against it.

State capitalism

The period from the end of the eighteenth century until the First World War is described as the “first episode of modern globalization”. Here the development of capitalism in Western Europe and America is characterised by free trade and minimal state intervention. Classical economic theory was the prevailing philosophy. The First World War changed all this. The use of central planning by the German state in directing the economy towards the war effort, known at the time as “war socialism”, impressed many including Lenin and the Bolsheviks, who used it as a model for the new regime established in Russia in 1917. This, along with the establishment of the Bolshevik regime, set the scene for the next seventy-five years where the state would take a larger, and in some cases predominant, role in directing the national economy. Desai calls this the period of “deglobalization” or “capitalism in one country”.

Desai remarks that Russia, at the time of the revolution, was mainly an agrarian country where the industrial working class constituted a small part of the population. In these conditions, the Bolsheviks were forced to embark on a course of rapid industrialisation. The Bolsheviks and their supporters look to the earlier works of Marx and Engels, which optimistically predict an immediate revolution as justification for the Russian Revolution being a genuine workers' revolution. They overlook the later and more mature works of Marx that argue that capitalism must be fully developed before a socialist revolution can be successful. Thus Leninist ideas on capturing the state through the vanguard party and organising society on state capitalist lines became the orthodox interpretation of Marxism. Although Desai describes, at least in the early years, the Soviet Union as state capitalist, he also rather inconsistently refers to it as an example of “Socialism outside Capitalism”, the attempt to build a state controlled society, alongside the privately run capitalism of the Western countries.

Desai also discusses what he calls “Socialism beyond Capitalism”, what Marx argued in theCommunist Manifesto would supersede capitalism after it outlived its usefulness. Desai describes this as “a self-conscious society, aware now that capitalism as a system of private property profiting from the social division of labour could not offer any further betterment, that would proceed to take control over the economy – society, mind you, not state.” In chapter 12, entitled “Can Socialism Work?”, Desai briefly discusses the theories of Otto Neurath on the feasibility of establishing a moneyless society. But these appear to apply to a centrally planned economy rather than a democratic socialist society. Desai also appears to not fully understand how a genuine socialist would be able to function, when he asks “how such a society would decide about saving and investment”.

Desai contends that the Great Depression in the 1930s undermined the general belief in the free operation of the markets, and Keynes' arguments that markets failed to perform efficiently and that state intervention was required for the smooth running of the economy gained ground. In the years after the Second World War, Keynesian economic theory clearly emerged as the dominant influence in the Western universities and on Western government policies, particularly in Britain and to a lesser extent the US. It heavily influenced the reformist policies of many Western Labour and Social Democratic parties, to which Desai refers as “Socialism within Capitalism”.

At the same time state capitalism expanded its influence with the coming to power in China of the “communists” in 1949 and the inclusion of most East European countries in the Soviet bloc. Many of the new countries that achieved independence from the former European colonial powers in the post-war years looked to the Soviet system as a model for economic development.

The 1970s saw something of an upheaval: the onset of a long-term economic crisis in leading Western countries, involving “stagflation”, where both inflation and unemployment rose together. Conventional Keynesian demand management policies were found wanting. The advocates of free market economics, such as the monetarists, who began the fightback in the universities in the 1960s, gained more credibility and the Keynesians were in retreat. In the late 70s and early 80s, the tide turned in favour of free market economics, with the coming to power of conservative leaders such as Reagan in America, Thatcher in Britain and Kohl in Germany.

Back to 1914

The USSR and Eastern Europe went into terminal economic decline, culminating in the fall of the Berlin wall in 1989. This marked the end of what Desai calls “the short twentieth century” and the beginning of the second period of globalisation, where restrictions in the movement of capital have been removed in the major industrial countries; free trade prevails; the former Soviet countries and many third world countries are integrated into the global capitalist order. The world has returned to where it left off in 1914.

The Leninist regimes in Eastern Europe have fallen. The reformism of the Western Labour and Social Democratic Parties is in retreat. However, Desai will not be joining us in working for world socialism. He declares that “there is no rival mode of production on the horizon as a viable alternative. Capitalism is the only game in town”. He claims that, far from collapsing, capitalism has been rejuvenated. He points to the latest developments in telecommunications and computer technology, and that many third world countries are modernising along capitalist lines. The world is not ready yet ready for real socialism (“Socialism beyond Capitalism”). Desai suggests that Marx would agree with him. He wonders if genuine socialism will ever be achieved.

The main problem with Desai's analysis is that he treats the state capitalist regimes in the USSR, China, Eastern Europe (“Socialism outside Capitalism”) and even the reformist policies of the Social Democratic parties (“Socialism within Capitalism”) as separate modes of production. It is true that the state capitalist regimes attempted to insulate themselves from the world economy in their earlier years. However the economies of these regimes were based on wage labour and production for profit and so were capitalist. The Western Labour and Social Democratic parties introduced policies to regulate capitalism not to replace it. Both were failed attempts to control capitalism. But as Desai well knows, and argues in this book, capitalism is resistant to any attempts to transform it into anything other than a system based on profit.

Looking at capitalism from a global point of view, it has already created the productive capacity world-wide, which would allow a world socialist society to produce abundance for the world's population. All further developments only aid the capacity of capitalist society to further enrich the capitalist minority, while their potential use in enhancing the well-being of the human race is restricted by the profit-seeking structures of capitalist society. What is now required is for the world working class to become class-consciousness and work to replace capitalism with socialism.

The Leninists may have appropriated Marx for the cause of state capitalism. But Desai wishes to appropriate him for free market capitalism. He seems to want to join with other academics and New Labour, in celebrating the triumph of free market capitalism, while at the same staying true to the left-wing idealism of his youth.

Oliver Bond