Where’s the money going to come from? (1994)

From the August 1994 issue of the Socialist Standard

Anyone who watches the political programmes at Sunday lunchtime will he familiar with the question "Where’s the money going to come from?" On 1 May, for instance, Brian Walden pressed Labour MP Ann Taylor on this question as a rejoinder to her suggestion of increased nursery provision. And Robin Cook, who insisted on the European Social Chapter (On The Record, 29 May), was similarly rebuked by the money question. Labour MPs of course have no real response they can hold against this shibboleth of received wisdom; they believe in the basic precepts which necessitate the asking of the question.

It seems obvious to socialists that an analysis of the nature of money is required here. It can't be simply assumed that money is a type of innocuous representation of actual wealth. On the contrary it must be asked if its overall arithmetical form imposes certain ideological categories and casts its own ethical (or unethical) shadow over our existence.

Nowadays the analysis of money has disappeared, in Orwellian fashion, from economic discourse. But critiques of money extend back over 2000 years. One of the best discussions of money, and one that greatly influenced Marx, is still that of the Ancient Greek philosopher Aristotle.

Aristotle

Aristotle attributed two natures to money, that of a means and that of an end. This distinction reflects an ethical critique of the effects of money and how it is used. Some uses of money were acceptable and even laudable, argued Aristotle, as when money is used simply as a convenient means of getting useful things. But other uses, he said, were unacceptable or perverted, as where the exchange of goods was simply a mask for the accumulation of money or spurious wealth. So trading directed towards the use of goods with money merely as a common medium of transaction was seen as good, and trading directed at the exchange of commodities for profit, with commodities used merely as a means of securing this profit, was seen as bad. The distinction corresponds closely, but problematically as we shall see, to the one between use value and exchange value.

Aristotle used the example of the Delphian knife to illustrate the perverting effect of money. The Delphian knife was a tool that was made to be exchanged for money rather than to be used to perform a task. It could be used as a knife, a file, and a hammer, but in none of these functions was it very adequate, its only advantage was that it was cheaper in money than the three separate tools together. Hence a compromise is made between the tool-like properties of the knife and its exchange properties, and insofar as it was made to serve the latter function, it is not really a tool, except, as it were, a tool for making money rather than things.

Even philosophy itself is compromised by its association with exchange value. According to Aristotle, the Sophists let themselves be tainted by the profit motive, for the Sophist "is one who makes money from an apparent but unreal wisdom". The medical profession too becomes confused when its ends are mixed between money-getting and health. Contemporary examples inevitably spring to mind: "health" businesses selling liposculpture, far from providing perfect information on the effects of the operation, as the market sophistry maintains, on the contrary deliberately deceive patients about the risks involved, in order to secure the sale. And it could be argued that in every consumer product, a compromise must be made when the purposes involved in its creation are divided between exchange and use value; between the requirements of the seller and those of the customer.

Aristotle’s distinctions of exchange and use, means and ends, ethics and purely economic factors apply to the modern orthodoxy. The relatively trivial question "Where’s the money going to come from?" becomes the penetrating question "What is money?" The latter question challenges the received categories of exchange relations and demands an investigation into the barbaric practices out of which exchange arose. It is a question that asks is money realistic — or atavistic?

It is clear that ideas as much as facts are central to the workings of money. For example, the principle that whatever projects are envisaged must come out of existing funds. Fiscal spending, so it is said, represents a real practical limit which it is impossible to surpass. Behind this is the idea of a finite cache of wealth, a fund or a larder, in which things have been stored, and out of which things can be withdrawn at a later date. Is this really a practical matter, as no doubt Brian Walden would believe, or is it the promulgation of an ideological programme?

Admittedly the roots of this "larderism" lie deep in the facts of prehistory, when the store of food for the winter exemplified the model of a limited physical source determined by the real quantity and the real fertility of the land. This model still provides a basic formula for the operation of banks and nations, the only difference being that food has been replaced by an abstract symbolism of money, taking the form of bank reserves or national currency reserves representing all forms of production, not just agricultural.

This larderism has a powerful hold on the level of folk economics. On this level, the constraints of fixed budgets emerge in populist style as slogans such as "you can't just print money", "there is no bottomless pit", "you can't have your cake and eat it", "you don’t get ought for nought", "money isn’t made in heaven it's earned here on Earth", "there's no such thing as a free lunch", etc. Ah, the stuff tabloids are made of. And on the academic level, the principle seems to be simply elevated by nobler terms of expression rather than critically evaluated. Lord Robbins urged us to accept economics as the eternal problem of matching infinite wants against finite resources; the fundamentals of Mercantilism insist that "no man profiteth but by another's loss". All these aphorisms, ranging from crudity to casuistry, suggest a store of goods gained by toil in the summer as protection from the oncoming winter.

Despite creditable origins, this economic picture is logically flawed by its attempt to project the properties of a primitive domestic situation upon the complexities of the modern macroeconomic world. Some systems do follow the model of a fixed fund of goods, but the patterns of complex interaction between humankind and the biological and physical world, are, or can be, either synergistic or mutually exclusive. In the case of synergy, the more you take out of them, the more you have left; in the case of exclusivity, activity in one area has no effect on activity in another. The universal form of money makes all activities mutually burdensome, and insists, for instance, that the growth in education must be paid for by cuts in health, or investment in transport must be paid for by defence. Thus a kind of universal parasitism is established. One must question the nature of a formula of mutual burden which happens to have the very useful effect, for the Establishment, of dividing factions of society as competitors for limited resources.

The concepts of synergy and mutually exclusivity seem to violate the plausible, but examples are easy to find. The human body is synergistic in that the more you expend its energy as in exercise, the more energy you have as in fitness. If the linear economic model was applied to the body, you would get fit by sitting still and eating, thereby accumulating capital as fat. Mutual independence is clearly a fact of the natural and human worlds; there is no logical or physical connection between distant objects and activities. A bee taking honey in Glasgow is not constrained by one doing the same in London, yet Strathclyde is constrained by public spending in the Home Counties. Why do we impede ourselves in this way? Well, the popular wisdom is that there is only one pot of honey (money), for which we vie for attention. We should learn something from the symbiotic ecology of insects.

Free lunch

An even more serious error of money symbolism concerns the frontier of possible growth. The pseudo-physical arithmetic limit on economic development seems to be rooted in the Physiocratic principle that all wealth comes from the Earth, or the similarly-arbitrary Mercantilist precept that all wealth comes from the trade, or for that matter from the Marxist view that value is added by labour. But not only are the Earth’s resources, in contradistinction to the money model, symbiotic; they are also supplemented, as is the human body, from an external source. The human body is an organism in the world and receives its energy through food, and the Earth is a planet in the solar system, that likewise receives, free of charge, an inexhaustible input of fuel from the star in the middle of the solar system: the sun.

The sun is the free lunch that orthodox economics can’t come to terms with. The money system operates on a closed world assumption, on the much-stated monetarist principle that money is made here on Earth, it doesn’t come down from the sky. In fact all the wealth-making processes on the Earth are driven by extraneous energy that does come down, as it happens, from the sky. If money fails to reflect this reality and its function becomes not to reflect actual resources but to impose an ideological limit on their development and distribution. And if those limits demand that the homeless cannot be housed and that the hungry cannot eat (because where’s the money going to come from?) then that ideology isn't innocuous but a necessarily ethical, and unethical, force.

So Aristotle’s point is proved: the effect of money does poison the transactions and distributions it enforces its rule over. But not just directly because of the profit motive or exchange, but indirectly because of the general nature of the abstract form of exchange which embodies false assumptions about the nature of the world: the assumption that the fiscal frontier is the final frontier.

But to make Aristotle’s analysis fully consistent we ought to abandon the means/ends distinction which had a confused relation to the use/exchange distinction, and say not that there are two types of money (use money and exchange money) but that money necessarily is exchange value, that exchange value is necessarily perverse, and that true usefulness is necessarily contrary to the abstract value which money imposes on the physical world.

If Aristotle had accepted this analysis it would have solved a number of problems for him. Instead of having a tension between the two natures of money, one related to use, and one related to exchange, he could have rejected exchange completely and have said that the evaluation of goods should be dependent solely on their quality as defined in use. In a socialist system it is indeed use value that is the criterion of true wealth, and the spurious abstraction which exchange relations arbitrarily, and harmfully, apply to useful things would be simply removed.

If the premise of inherent scarcity is abandoned, as it can be when the qualitative, generous and realistic physical frontier is substituted for the miserly quantitative economic frontier, then it is no longer necessary to measure all goods by one universal standard as a means of rationing them. Is money the measure of all these things or are humans? Let us say the latter and thus advocate, along with an Aristotle-made-consistent, the abolition of exchange and the abolition of money. And if money is abolished, the question, where is the money to come from, is obviously redundant.

Norman Armstrong

Letter: Fragmented and Inchoate Project (1995)

Letter to the Editors from the August 1995 issue of the Socialist Standard

Fragmented and Inchoate Project

Dear Editors,

One of the greatest obstacles for me in accepting the kind of socialism advocated by the Socialist Party was its attitudes towards partial ameliorative reforms, which I found illogical, believing that any improvement in immediate conditions should be promoted vigorously and urgently. Why not fight for better workers’ rights, a better health service, transport, a right to work, freedom of association, a right to welfare, strong charitable institutions? All these seem like good causes worth defending.

However, I am changing my mind. I am beginning to see not only that the fight for partial reforms represents a fragmented and inchoate project in which the various claims to resources are actually made to clash with each other, but that the struggle for “rights” and "freedoms” as we perceive them in a capitalist society is distorted by the language of the market economy, it is invested with what Marx called the ideological superstructure— a set of ideas charged with the function of protecting the existing organism, by leading people astray into misguided, or even damaging, avenues of protest.

So it is, that, in an atomised and isolated way, individuals support various charities, pressure groups and unions. The historical precursors to these groups are what Marx called the Utopian socialists, a group of unconnected thinkers spanning the 18th and 19th centuries who railed against the emerging barbarism and inhumanity of international capitalism. These philosophers and economists, mostly either English or French, were a great influence on Marx himself. The difference is that Marx’s analysis of capitalism is on a deeper level than any of his predecessors; for his aim was not, for instance, to accept the "right” of the displaced labourer to the benefits of humane parish support, but more profoundly to reject the premise that human labour must turn to the capitalist for favours of charity, when the employer deems him surplus to the requirements of profit. Marx argued that "rights" and “freedoms" were determined by the material forces of production, and for him the point was not to assent to these forces—but to change them.

It seems to me that Marx was exactly right The way capitalist epigones appropriated the terms "freedom" and right, only admits of social justice within a narrow circle permitted by market forces. Marx’s scientific socialism amounts to a critique of the idea that social justice ensues from the proper disbursement to labour for the pain of labour; for Marx rejects the idea of the equation between labour and pain, and on the contrary shows that the expressive exertion of brain and muscle is at the centre of human beings’ existence. By absorbing the assumption that man has by nature an aversion to the exercise of his faculties, the Utopians conceded an axiomatic assumption of the capitalist system they strove to revise, and they were therefore limited to a kind of partial, extenuated reformism which was doomed to be ineffective. These palliative reforms are the basis of the fragmentary struggles we see today in the field of social justice.

In short, the Utopians (Hodgskin, Thompson, Gray and Bray) sought decent wages for workers, that is, a fair rate of exchange for the value by which the labourer enhanced the product. Marx’s analysis is far more profound; for him, the evil does not lie so much in the poor rate of exchange of labour, but in the very nature of exchange, which converts man as an active social and productive being into an instrument of profit by means of which man is not kept industrious and happy, but on the contrary unwillingly unproductive and unfulfilled.

Norman Armstrong, 

Glasgow

The Nature of Work Under Socialism (1994)

From the May 1994 issue of the Socialist Standard

To some Mrs Thatcher was the anti-Christ, and there is some justice in this reprobation. But above all she was the arch anti-philosopher, the ultimate philistine, the unthinker, the stagnant pool of accumulated prejudice, a museum of reactionary forces. Yet the chord was struck, and the nation chimed to the note, as indeed the world even now still resonates from the impact of the seismic disturbance that swept through its economy, forcing all before it, and of which Thatcherism was a parochial part, neither particularly significant nor powerful in itself. But of true significance was the historical trend towards the fundamentalism of market theology, and the concomitant trend away from the values of human interaction and rational assessment and evaluation.

Socialist Thought
The re-evaluation of the present system of relations between people we may call socialist thought. Socialism asserts that the world changes in the sense that the currently-prevailing concept of human nature is not after all the absolute truth, but merely an historically contingent consequence of the equally contingent political and economic systems for the production and distribution of "goods".

Perhaps the most crucial component in all the socialist credo of alternatives is the radically utopian concept of work. All work in socialism will be voluntary. Voluntarism is to be extended not only to the choice of occupation but the the duration, intensity and all aspects of the organization of work. It is a curious fact that the greatest advocates of "freedom of choice" consider it the greatest affront to suggest that the producers of goods should have any choice in the matter of their own occupation.

Despite the oft-deployed transparent sophistry' calculated to show that Venezuelan gold miners and production-line workers in Eccles have freely entered into an open partnership with their employer, it is plain enough that starvation in the one case and insidious coercion in the other (e.g. the cheerful "back to work programme", the scheme for officially persecuting the unemployed) have been the most persuasive clauses in the arguments of employers.

No defence
For the most part capitalists do not even attempt this defence: the worker must do what is necessary for the market and for profits, and the individual choice must subserve this higher need. In this world, the luxury of choosing a life of fulfilling vocational work is the reserve of the lucky few; it is not the normal condition.

How has it come about that the most essential part of existence, that of what a human person is to do with their life by means of work, has been refused admission to those things that are left to choice? In a nutshell the received wisdom states:

1. work must be done to furnish need.
2. work is hated by all, therefore,
3. work must be obtained by compulsion.

Concerning premise (2), the history of work has indeed been a succession of misery, drudgery and oppression.

Hell of toil

It may indeed be historically true that in certain stages of human development, it was absolutely necessary that the great majority of humans had to be cast into a hell of unremitting toil. But for socialists, work is not inherently unpleasant. On the contrary, the "hardship" of labour, or the production of goods, is no longer even to be sharply separated from their consumption, or the "reward" of labour, since both are necessary for the harmony of the human being. The mastication of food, the exertion of muscle and brain, are not only equally important for life, but equally desirable for any balanced person.

Work may have hitherto been extracted by a species of social contract whose terms are ones of coerced servility, where "the elevation of the few is founded on the degradation of the many" (T.H. Green 1881). But these terms are not characteristics of work itself, only of the contemporary capitalist arrangement and are insisted upon in order to ensure the pliancy of the workforce. Consequently, the socialist rejects the punitive attitude towards work, for in socialism work is to be made pleasant. And if work is pleasant, then the main objection to it being made voluntary is removed.

Curse of work?

Yet nearly everybody seems to agree that work is a curse rather than a gift, but they confuse the nature of work with the nature of capitalism. The capitalist conception of work is founded on a philosophy of human nature, according to which a human is a "rational" creature whose greed and idleness direct them respectively to consume as much, and do as little, as possible. The absurdity of this position is obvious (try to consume without doing, or try doing without consuming), but despite its falsity it is a powerful image, sustained from above by sinecured intellectuals, and from below by a credulous proletariat. The first are sustained in their belief by a mixture of fear and vested interest, the second by inarticulation and institutionalized stupidity. However in fairness, intellectuals have never been merely the paid propagandists of mill owners, rather along with the owners of the means of production they shared an interest in perpetuating the financial institutions that supported them, and a trepidation concerning the permanent threat of revolt. The comfortable bourgeoisie seems to have long felt disturbed by the possibility of herdish multitudes rising up and wresting their comforts from them, a fear no doubt exacerbated by the feeling that the "working classes" were essentially alien, devoid of refinement or the potential for moderation.

Grovelling animals
These Morlocks, the "other" species, were just a kind of animal "with sensual desire and grovelling thought; foul of body and course of soul" (Ruskin, Ad Valorem 79).

Among nineteenth-century thinkers who were human enough to be moved by the condition of the working people, yet not so moved to overcome their prejudices towards them, were Charles Dickens and John Stuart Mill. Dickens, the author of Hard Times, effectively quarrels with the characters Bounderby and Gradgrind for reducing workers to economic and material factors of production, but would he allow those workers the helm of society? The unrestrained multitudes that run amok in A Tale of Two Cities reveal the beast Dickens believed to lurk in the common man. Animals deserve an understanding protector rather than emancipation. J.S. Mill had a similar attitude. Mill’s own life of arduous creative work did not soften him to the view that a fulfilling active life was for the lower orders:

"It is a common error of socialists to overlook the natural indolence of mankind; their tendency to be passive, to be the slaves of habit, to persist indefinitely in a course once chosen . . . they . . . will not exert themselves to improve, and letting their faculties rust, will lose even the energy required to preserve them from deterioration." (Principles of Political Economy, 1848)

Mill was not stupid, but intelligence is a weaker force than prejudice.

Brilliant stupidity

The history of thought is littered with examples of brilliant men thinking stupid things. Another great philosopher who was twisted by bigotry was David Hume:

". . . the poor labour more, and really live better, than in years of great plenty, when they indulge themselves in idleness and riot". (Political Discourses, 1752)

A lesser figure, Arthur Young, preached the orthodoxy as follows:

"Everyone but an idiot knows, that the lower classes must be kept poor, or they will never be industrious." (A Farmer's Tour Through the East of England, 1771)

The most remarkable thing about these insights into the forces governing the behaviour of the toiling classes is how easily the authors exempt themselves from their operation.

Selfless devotion

"Human nature" is for others, not for the sons of the aristocracy who toil at art or criticism or at philosophical tracts on human nature, not for the aspiring middle-classes who devote themselves selflessly to public service or career. No, only the incontinent masses seem to be subject to the universal laws of the human species.

Yet the socialist, perhaps surprisingly also has allies amongst these comfortable intellectual classes. Strangest of them is John Ruskin (1819-1900), ("I am a Socialist of the most stem sort — but 1 am also a Tory of the sternest sort"). Ruskin, cloistered academic and critic, nevertheless had the intellect to challenge the received concept of human nature and labour.

That concept of the guzzler, the idler is the target of Ruskin's biting satire:

"It is proposed to better the condition of the labourer by giving him higher wages. He will either drag people down to the same point of misery at which you found him, or drink his wages away. He will, I know it. Who gave him this will? Suppose it were your own son of whom you spoke, declaring to me that you dared not take him into your firm, nor even give him his just labourer’s wages, because if you did he would die of drunkenness, and leave half a score of children to the parish. ’Who gave your son these dispositions — I should enquire. Has he had them by inheritance or by education?’ By one or the other they must come; anti as in him; so also in the poor. Either these poor are of a race essentially different from ours . . .  or else. . . we make them as continent and sober as ourselves — wise and dispassionate as we are " (Ad Valorem 79)

The notion of the shirking, propagating, drinking, working classes survives down to the present.

The Child Support Agency is clearly a descendant of the fear of feckless scroungers leaving "half a score of children to the parish". For "parish" read "income support" and nothing has changed.

The idea that better wages for workers will not ensue in a riot of drunkenness and fornication receives most surprising support from that guru of laissez-faire economics, Adam Smith (1723-90):

"A plentiful subsistence increases the bodily strength of the labourer, and the comfortable hope of bettering his condition, and of ending his days in ease and plenty, animates him to exert his strength to the utmost. Where wages are high, accordingly we shall find the workmen more active, diligent and expeditious, than where they are low. " (Wealth of Nations, 1776)

This is not a description of an inherently lethargic creature. The tendency of humans to remain endlessly motionless has been greatly exaggerated. A life-time of meaningless slavery and overwork indeed gives an appealing aspect to the possibility of its permanent remission. But we look at life from a distorted position, one of battered submission and a routine of pointless drudgery.

The point of socialism is to remove the malignant influence of capitalism which poisons our attitude to production and alienates us from its purposes.

Satisfaction

The essential purpose of work is not to make profits, and consequently the act of labour is not essentially vile. Labour may indeed be a devil while encased in Mammonism, but freed from that prison, the purpose of work is revealed in a truer light, and is two-fold: firstly to provide the goods of life, whether food, tables, transport, health, books, music or knowledge; and secondly to provide satisfaction in the process of producing these goods.

No work which does not satisfy both these requirements will be considered necessary in socialism. The act of producing goods (as opposed to profits or "bads") is precisely what ensures this satisfaction. This being so, coercion, punishment or persuasion is not necessary for the securing of those human activities essential for the products of civilization. It is not beyond human wit to devise a system to combine our need to work, our need to be valued, our need for regard and for self-regard, with those things which need to be done. It is not beyond our wit to combine our freedom, i.e. our voluntarism, with our needs.

The paradigm shift required to understand the transition from capitalist work to socialist work may however be beyond many a great philosopher. Unfortunately many elderly philosophers suffer from a severe ease of hardening of the categories, and would rather stick to fox hunting than consider a novel idea. In many ways children are better philosophers than their long-robed superiors, since they have not yet become set in their ways.

Higher understanding

One small boy in particular, albeit a fictional one, demonstrates a higher understanding of people’s relation to work than a flock of Oxford dons:

"Tom said to himself that it was not such a hollow world after all. He had discovered a great law of human action, without knowing it, namely, that, in order to make a man or a boy covet a thing, it is only necessary to make the thing difficult to attain. If he had been a great and wise philosopher, like the writer of this book, he would now have comprehended that work consists of whatever a body is obliged to do, and play consists of whatever a body is not obliged to do. And this would help him to understand why constructing artificial flowers, or performing on a tread-mill, is work, whilst rolling nine pins or climbing Mont-Blanc is only amusement. There are wealthy gentlemen in England who drive four-horse passenger coaches twenty or thirty miles on a daily line, in the summer, because the privilege costs them considerable money; but if they were offered wages for the service that would turn it into work, then they would resign." (Mark Twain: The Adventures of Tom Sawyer).

Norman Armstrong