Unemployed Workers on the Continent. (1933)

From the September 1933 issue of the Socialist Standard

The apologists of capitalism in this country often aver that the workers here are better off than in other countries. A correspondent of The Times has recently been making a tour of France and Italy investigating the conditions of the workless there. In Italy most of the 1,200,000 unemployed belong to the Fascist party on account of the rations given to their unemployed members, and the correspondent remarks: “You will realise that the unemployed single men probably get more in actual relief than our own unemployed." In France, the official figures show that more than half the unemployment is in Paris and the surrounding Department of the Seine. “In Paris, the unemployed single man gets from 10 to 12 francs minimum a day as dole, and if he is living in lodgings, the keeper of his house gets another four francs a day for his room. Multiplied by seven days each week, this makes, even with the exchange, an allowance considerably above our own." But apart from such slight differences, capitalism is everywhere the same. It weeps at the large number of idle workers whom it cannot employ at a profit, while it grudgingly doles out the barest necessities of existence.

R. M.

Notes by the Way: What Mussolini did for Italy (1935)

The Notes by the Way Column from the October 1935 issue of the Socialist Standard

What Mussolini did for Italy

 

Here is a brief description of the lofty principles on which the Fascist Government has trained its boys and young men, under the guise of “education."

There minds have been saturated with bellicose sentiments. The word Fatherland has lost for them its meaning, apparently obsolete, of love for the native land and its inhabitants, and has come to signify a proud and pugnacious attitude to the foreigner. While they were still boys the rifle and the machine-gun were put into their hands. All their Sundays were spent in military exercises. In their elementary school they were taught from a State text-book in which the martial virtues were exalted as the best virtues of a citizen. Indeed, later on they were taught that the citizen in Italy is from 6 to 60 a soldier, and that Italy, in the words of the chief of Fascism, must be a “military, militaristic, and warlike nation." (Times, September 5th.)

* * *

 

Capitalist Crisis and Capitalist War

 

Sir George Paish, in a letter to the Press, recently drew attention to an aspect of the Abyssinian conflict which has received little notice, that is the similarity between the condition of Italy now and in 1896, when also war was waged on Abyssinia.

"At that time the world was suffering from a severe economic and financial crisis, and the distress of Italy caused her statesmen to seek relief in a policy of conquest. The world to-day is suffering from a crisis more severe than 40 years ago, and Italy is in even greater distress than she was then. In consequence, Italy desires a colony to give her a market for her products, to which her people can emigrate, and from which she can obtain food, raw material, and gold .... economic and financial distress is the real cause of the difficulty.” (Times, August 31st.)

Here we have from a world-famed economist, who hopes and believes that capitalism can and should be saved, a fairly frank admission that capitalism is at the root of modern wars.

* * *

 

The Rate of Increase of Output in Industry

 

The rash speculations of Douglasites and others about a supposed vast and rapid increase of output in industry, due to the introduction of improved machinery and processes, have received additional refutation in a survey of output in the Economic Journal (September, 1935), by Ely Devons, of the Economic Research Section, Victoria University of Manchester. Basing his survey on the census of production and other material, he finds that the increase of output per head of the workers in all manufacturing industry in this country increased by at least 14 per cent. in the six years from 1924 to 1930. He thinks the actual figure will be somewhat larger than 14 per cent. for reasons given in the article. Making a reasonable allowance for this, it will be seen that the increase per annum is rather less than 3 per cent.

Taking the smaller range of industries which are covered by the Board of Trade’s index of production he finds that the increase of output per head of the workers actually in work was 20 per cent., or a little more, in the nine years 1924—1933. This gain is well below 3 per cent. a year.

These estimates agree with others given in the Socialist Standard from time to time.

* * *

 

The Output in Mining and Iron and Steel

 

A writer in Forward (August 24th), who shares the misconception that productivity increases at a “tremendous” rate, gives figures relating to coal-mining, an industry in which a great deal of machinery has been introduced. He claims that after allowing for the big reduction in the total output of coal, for the decrease in the number of miners, and for the greater amount of short time, output per head has increased by 30.4 per cent. in the ten years 1923—1933. Even if this were the whole story the increase each year would still be less than 3 per cent. of the previous year's output. Actually, however, it leaves out of account any additional labour used up in the manufacture and maintenance, etc., of the machines, also the fact that, the output per head in 1923 represented a big decrease, as compared with 1913 (from 260 tons a year to 229 tons).

 

On the other hand, miners’ hours of work are shorter than before the War.

 

If these modifications are allowed for it will be seen that miners’ output per head now as compared with that in 1913 has increased at the outside by not much more than 2 per cent. a year. The rate of increase in recent years may have been somewhat larger, but much of this has merely made up for the previous decline in output due, among other causes, to the fact that coal becomes more difficult to get at as the mines become more worked out.

 

An estimate of the increase of productivity in engineering, shipbuilding and iron and steel, based on the index of output published by the Royal Economic Society, and on the number of workers actually at work in these trades, shows that output per head between 1924 and 1930 increased by about 3 per cent. a year.

 

* * *

 

Major Douglas puts his Cards on the Table

There is certainly one thing for which Major Douglas deserves praise, that is for his very definite statement of his attitude towards the Alberta Social Credit Government. He might, had he wished, have expressed vague and qualified approval without committing himself to anything definite. Instead, in an article in the Sunday Express, he stated in plain language exactly what he believes the Alberta experiment will produce. As we know that the application of the Douglas theories will fail to achieve the results Major Douglas anticipates, it is a suitable occasion to place on record what he wrote in the Sunday Express on September 1st, 1935. The following passages are extracted from the article in question:

Mr. Aberhart, the new Prime Minister, is a man of magnetic personality and a magnificent orator. In the heat of the election he went rather beyond any proposals that I have made, but it is entirely false to say that I am in disagreement with him, I admire him greatly (Italics ours.)

He promised during the election to pay every Albertan five pounds a month. I hope and believe that once his plans are in full operation that figure will be substantially increased.

If the credit of a rich province is made fully available to its people without artificial restrictions of any kind, there will be no poverty. Everyone will have enough to eat, a decent home, opportunities for recreation and adequate leisure.

That, I believe, will happen in Alberta if the new Government sticks to its policy. It will probably take fifteen months before the plan is in full operation, and that fifteen months will be a period of great difficulty and bitter strife. The vested interests of the bankers and financiers will not relinquish their monopoly without a hard struggle.

In 15 months from now, I believe that Alberta will be a blessed land. Unemployment will no longer be a menace to its citizens. No wheat will rot in its elevators. Fine new roads will enable tourists to appreciate its magnificent scenery and bring further wealth to its people.

It will become one of the show places of the world.

 

* * *

 

Capitalism and Superior Brains

 

Ousted from one position after another, defenders of capitalism finally fell back on the “superior brains." The capitalist, we are told, provides all the brain-power, the ideas, the organising skill and directive ability. His was the creative genius, without which the wage and salary earners would be floundering about in muddle and chaos.

The creative geniuses of capitalism finally produced the world war and the world crisis and, in passing, they turned whole counties of Great Britain into distressed areas, where idle men and idle mills rotted together. And what about the "superior brains" meanwhile? Having produced the chaotic conditions, are they setting to work to produce a remedy? By no means. Instead, the Chairman of the Whitehead Iron & Steel Co., Ltd., of Newport, Monmouth, is offering a prize of £1,000, with additional prizes of £200 for practical suggestions for “permanently and substantially reducing existing distress in South Wales and Monmouthshire (Daily Telegraph, August 31st).

You send your answers to the Industrial Development Council of South Wales. We know the answer, but we fear nobody will receive a prize for sending it in.

 

* * *

 

"200 Companies Own Half U.S."

 

Under the above heading the Star (August 3rd) publishes a report from Reuter's Agency, stating that, according to the American Bar Association, about 200 Corporations, managed by approximately 1,000 directors, own one-half of the wealth of the United States. These 200 corporations do not include banks.

“A small number of corporations exercise a dominant influence over price control and trade practices, and virtually control the production and distribution of the country,"  a report by the Association states.

Edgar Hardcastle

The Socialist Forum: Parliament and the Bankers. (1932)

Letter to the Editors from the June 1932 issue of the Socialist Standard

A Belfast reader asks the following questions : —

(1) Do the bankers or Parliament rule, and is Parliament a tool of the former?

Do the bankers dictate the economic, financial and, for the most part, the political programme Parliament must carry out?

(2) Did the bankers engineer the “crisis” during the autumn of 1931 and compel England to abandon the gold standard and also order a general election to take place?

(3) Could you point out some of Capitalism’s contradictions ?

Reply

(1) The Government is dependent for its existence on having the support of a majority in the House of Commons. The M.P.’s are elected by the voters, the great majority of whom are workers. The bankers, like any other section of the population, can only get their interests protected if they can get Parliament to approve.

The property rights and profits of the bankers are protected by law, just as are the property rights and profits of other sections of the capitalist class. Sometimes Governments lean towards one section of the capitalists (e.g., the bankers) and sometimes towards other sections (e.g., industrial capitalists). This they do either because of some urgent problem requiring treatment for the safety of the capitalist system, or in response to pressure from the M.P.’s and the political parties. The last Conservative Government by its rating reforms helped some industrial capitalists at the expense of other capitalists. The present Government has introduced tariffs with the same object. The return to the gold standard in 1925 was of benefit to bankers and to other sections of the capitalists.

That the bankers are able to secure protection by law and by the Government, is due to the fact that the electors approve. At the last election the “National” parties proclaimed that they were protecting the banks against supposed danger which would threaten if the Labour Party gained office. This did not prevent the majority of the workers from voting for the “National” candidates.

The bankers and other sections of the capitalists, of course, do not state openly that they are seeking protection for their own particular interests. They argue that what they seek is in the interest of the nation as a whole, and especially of the workers. While the workers lack knowledge of Socialism they will continue to accept this plea and vote into power people and parties favourable to the retention of capitalism in general and more favourable to the particular interests of bankers at one time and industrial capitalists, etc., at another.

Our correspondent should notice what happened at the recent by-election in St. Marylebone. There were two rival Conservative candidates in the field. One of them, Sir Basil Blackett, is a director of the Bank of England and had the backing of most of the Conservative leaders and the party machine. Yet he was beaten by the opposing Conservative candidate who had the backing of the rank and file of the local Conservative Party. The electors decided the issue.

(2) With regard to the question as to whether the bankers engineered the “crisis” of last autumn, we can only say that it is for those who hold that view to bring forward evidence in support. On the face of it the suggestion appears improbable, since the abandonment of the gold standard is hardly likely to have been sought by the bankers who favoured the return to gold in 1925. Our correspondent is referred to the articles published in several issues of THE SOCIALIST STANDARD from September onwards, dealing with various aspects of the “crisis.”

(3) The following are some of the contradictions of capitalism.

The existence of great wealth and great poverty side by side.

The existence of unemployment among workers needing the products of industry and willing to produce them, while at the same time the raw materials are lying unused and the factories idle.

Compulsory idleness among unemployed and enforced overwork among the employed workers.

The utilisation of labour-saving machinery not for the benefit of the users of them, but for the benefit of the capitalists, often accompanied by still greater strain on the workers.

The glorification of the leisured class and the simultaneous denunciation of idleness among the workers.

The prohibition of theft by Governments which use armed forces for wholesale robbery from other nations.

Ed. Comm.

The Socialist Forum: Some Questions About Gold. (1932)

Letter to the Editors from the April 1932 issue of the Socialist Standard

Elvaston Place, S.W.

Editor of the Socialist Standard.

Sir,

In October, you wrote: “The illusion that lack of gold has anything to do with the main problems is easily dispelled.” Is trade depression not a main problem ? No doubt a large part of the world’s economic difficulties are due to the lack of any plan in laissez-faire production and to the inequitable distribution of purchasing power resulting from private exploitation of the sources of wealth. But the best chance of modifying these conditions lies in the trades unions’ membership being increased, and the number of their members varies inversely with the percentage unemployed.

If the supply of gold is inadequate for the alleged requirements of the central banks and their clients, then primary prices will be forced down ; such a fall in prices involves reduction in the demand for manufactures, and inadequate profit or prospective losses deter the entrepreneur class from operations which increase employment and wages. There is almost complete short-term correspondence between the relation of primary prices to costs and the numbers unemployed, while with the upward trend of prices from 1896 to 1915 there was only two-thirds the unemployment of the preceding twenty years when the trend of prices was downward. Thorp & Mitchell’s Business Annals shows seven times as many years of prosperity per year of depression for the upward periods, 1849-73 and 1896-1920 as for that from 1873 to 1896. Your reference to the “very great increase in the supply of gold from 1890 to 1914″ shows that you do not appreciate the meaning of the term, “relative gold supply,” i.e., the actual supply relative to an increasing demand. This rose but slowly from the year 1896, allowing for an average increase in prices of about 2 per cent. a year from the disastrously low level of 1894-98. Both employment and the standard of living, however, were much higher at the end of the period than at the beginning. In 1926, real wages in the United States, according to Professor P. H. Douglas, were one-quarter higher than in 1890-99, while for Great Britain the New Survey of London gives a figure one-third higher than in 1890.

With regard to the second part of the article, “The Gold Standard and the Crisis,” I should like to say that (1) a practical policy must adapt itself to changing conditions. At the beginning of 1931, Mr. Keynes—who was mainly responsible for the Macmillan Report—considered that Great Britain would be in a much stronger position for leading the world out of the depression if sterling remained tied to gold. In the summer he no longer held that view. (2) Mr. Norman’s opinion as to the efficacy of Bank Rate is of no importance. Under the circumstances, a 9 per cent. rate would have been ineffective, but would probably have caused a panic. It might have been better if we had abandoned gold without first borrowing and then being pushed off, but to contend that the Bank should have maintained payments in gold, come what might, is to imagine that gold parity is an end in itself. The essential—as opposed to the ostensible—reason for high money rates is a sharp rise in the level of prices. And prices were falling heavily.

Geoffrey Biddulph.

Reply

Mr. Biddulph’s remarks are only distantly related to the articles which he seeks to criticise. Further they reveal a complete lack of understanding of the Socialist view of the depression. Our contention is that the present crisis is merely a fresh manifestation of an ever-recurring phenomenon of capitalism. As such it does not create any new problem for the workers, whose political object should be the substitution of capitalist society by Socialism. Consequently the workers, as a class, have nothing to gain from any of the various measures—from tariffs and wheat quotas to currency reform—put forward to rescue capitalism from the mire in which its own inherent defects have landed it. By whatever means the depression is ended, capitalism, as a system, will remain intact. In other words the propertyless condition of the workers, the ending of which is, in our view, their sole concern, will persist. Reforms designed to make that condition less oppressive have no attractions for us. When we discussed the present trade depression it was with two objects in mind. In the first place we wished to show how the fundamental cause of this crisis—as of its predecessors—was the fact that goods are produced by wage-labour for profit and not for use. Secondly, we sought to refute certain of the explanations of the crisis that have been advanced, and to expose the incompetence in high places that it has revealed. As we carefully pointed out, we are not concerned to take sides on the question of gold versus managed standard; we merely gave an account of the events thai led up to the abandonment of the gold standard by this country.

Having made clear our position let us turn to Mr. Biddulph. Although he does not specifically say so, it would appear that his view is :—

(1) That the depression is attributable to a fall in the general price-level, itself the consequence of the fact that the rate of increase of the world’s gold has been less than the rate of increase in “the alleged requirements of Central Banks and their clients” for gold.

(2) That a rise in general prices is required to end the depression.

(3) That rising prices are desirable from the point of view of the workers.

The second and third points can be taken together. Even if it is conceded that the depression could be ended by a currency policy that would raise world prices, would the basic conditions of the workers be altered? For one thing would unemployment be eliminated? The most that Mr. Biddulph can claim for a period of rising prices is that unemployment (on the experience of 1896-1915) might be reduced to two-thirds of what it is at present. It is just because Capitalism cannot provide a full life for all, even given the most favourable business conditions, that we are Socialists. Unemployment is a symptom of a defective economic organisation and the defects it indicates remain when unemployment is relatively low as when it is relatively high. This is what reformers and those who talk of “years of prosperity” overlook when they urge their reforms and the taking of steps to restore “prosperity.”

So far as Mr. Biddulph’s first contention is concerned, that is open to two criticisms. Firstly, if it is correct, then Capitalism stands condemned on account of the incompetence of capitalists, for from his use of the word “alleged” in the phrase “alleged requirements of the Central Banks and their clients” for gold it is clear that these requirements were in his view capable of being reduced. In other words, the relative shortage of gold, which he believes to be at the root of the trouble, need not have manifested itself if the world’s leading bankers had possessed but an elementary knowledge of correct currency principles. This is to say that the crisis occurred because of the inability of those in charge ot the financial machine to run it properly. A system of production under which there is such scopes for incompetence to produce evil must stand condemned.

But in our view the crisis cannot be traced to monetary causes. Prices did not fall because of the decline in the relative gold supply but because, as periodically does and must happen under capitalism, goods were produced beyond the capacity of the market to absorb them.

The facts do not support the contrary view advanced by Mr. Biddulph.

The period from 1925 to 1929 was, for the world as a whole, one of increasing economic activity. Even here the national income was rising, and U.S.A. enjoyed the greatest boom in its history. The increase in the supply of gold during that period must have been sufficient to carry the increased volume of business, since economic expansion in fact occurred. In the face of this Mr. Biddulph’s theory requires that the rate of increase in the gold supply after 1929 was less than during the preceding 4 years. Unfortunately for the theory, however, the figures show exactly the opposite. According to the estimates of Mr. Kitchin (see “The Times,” February 18th, 1932), in the years from 1925 to 1928 the world’s gold production increased, as compared with the preceding year, by nil, 1.8 per cent., .04 per cent, and 1.3 per cent, respectively and in 1929 was 1.1 per cent, less than in 1928. On the other hand, in 1930 output rose by 3.5 per cent, above the 1929 level and in 1931 was even 4.4 per cent, more than in 1930.

But apart altogether from the question whether the relative supply of gold was or was not sufficient to maintain the 1929 price level, Mr. Biddulph has no justification for stating, without further evidence, that the crisis resulted from a fall in general prices. The price level was falling continuously up to 1929, yet the slump did not start until that year and indeed, as already stated, the period from 1925 to 1929 was one of economic expansion. This last fact destroys the whole of Mr. Biddulph’s case and completely disproves his implied assertion that periods of falling prices are periods of dwindling trade, reduced employment and declining “prosperity.” In this connection it is worth looking at some figures. Between 1924 and 1929 wholesale prices fell about 20 per cent. During the same period the Board of Trade index of industrial production rose about 14 per cent., and the numbers of insured workers in employment rose by nearly 9 per cent., although admittedly the percentage unemployed rose from 10.7 per cent, to 11.1 per cent.

Of those, such as Mr. Biddulph, who relate trade activity to rising prices, Mr. D. H. Robertson, the well-known economist, has well written that they speak “with the voice of the inflationist entrepreneur of all ages, claiming that the scales must always be weighed in (their) favour if (they) are to do (their) job properly” (The International Gold Problem, 1931, page 146).

So much for Mr. Biddulph’s main argument. The other points in his letter must, because of the lack of space, be dealt with only briefly.

(1) He implies that the standard of living rises with rising prices and vice versa. Sauerbeck’s index for 1873 was 111 and for 1896 was 61, a fall of about 45 per cent. Would Mr. Biddulph contend that the standard of living was lower in 1896 than in 1873?

(2) So far as the last paragraph of his letter is concerned, we regret that we cannot, without evidence, accept Mr. Biddulph’s view of the efficacy of the Bank Rate as being of greater value than the view of Mr. Montagu Norman.

(3) As we do not enjoy the personal confidence of Mr. Keynes we are interested to be informed of his changes of opinion by Mr. Biddulph. We had, however, thought that Mr. Keynes had been opposed to the gold standard for some years. As long ago as 1925, Mr. Keynes was opposing a return to the gold standard, and advocating a “managed” currency. (See “Nation,” March, 1925.) The “Nation” (supposed to echo the opinions of Mr. Keynes) were attacking the gold standard early in 1931.

4) Finally, we would assure Mr. Biddulph that we fully appreciate the meaning ol the term “relative gold supply.” In fact, we understood the phrase to have been introduced into economic discussion by Prof, Cassel, and that among economists it had the meaning given to it by him. For Mr. Biddulph’s guidance we quote from “Fundamental Thoughts in Economics,” where Prof. Cassel writes : “I have introduced the conception of a relative gold supply, which is for any given year the actual gold supply divided by the normal gold supply.” Mr. Biddulph might compare this definition with that given in his letter above.

B. S.

An American looks at Capitalism and the British Labour Party (1939)

From the January 1939 issue of the Socialist Standard

A reader (I. R., Roxbury, Massachusetts) writes drawing attention to a book recently published in the United States called “Is Capitalism Doomed?” It is by Lawrence Dennis, a former member of the United States diplomatic service and of the well-known Wall Street firm of E. & W. Seligman. Our correspondent says that, in spite of the intellectual bankruptcy of Seligman’s solutions, the book is as intelligent a defence of capitalism as is possible. “Its great merit, however, is that he attempts to portray as objectively and as accurately as his class interests will permit him a picture of modern capitalism as distinct from the capitalism of yesterday.”

Dennis argues that, “in its old age, senile capitalism must be nurtured by the State . . . with an even diet of two per cent. gruel. Capitalism has run down for want of new worlds to conquer. . . . The State must supply the capitalist machine with markets which it is at present powerless to create for itself.”

He regards heavy taxation as a necessity, the important thing to him being the safeguarding of capitalism, even if this means cutting into the largest fortunes. He states (with approval) that “capitalism and nationalism are individualistic, competitive and non-co-operative, and therefore international co-operation is a misleading idea.” Consequently he regards plans for disarmament and international pacts as foredoomed to failure.

On page 300, Dennis complains that British Labour has been swayed for higher wages instead of for Socialism, and continues: —

“Socialism means work for everybody, even if it be creating things that capitalists do not approve of. The British Labour Party lacked the power to apply Socialism. English capitalism might have been saved from its present plight had the British Labour Party taken a few drastic measures against British capital just after the War.”

This last opinion is interesting, coming as it does from a man whose sole interest is to save capitalism from destruction.

Blogger's Note:

There's a strong chance that 'I. R.' of Roxbury, Massachusetts was Isaac Rab. It's worth checking out the wiki page for Lawrence Dennis. To say he was an interesting 'character' is to put it mildly.

50 Years Ago: The King and the Slums (1986)

The 50 Years Ago column from the December 1986 issue of the Socialist Standard

The publicity given to the decline in unemployment and to increasing prosperity (measured in the capitalist mind chiefly by Stock Exchange prices) is somewhat offset by the conditions in the depressed areas, at the moment in the spot-light.

Dudley Barker, in the Evening Standard (November 16th, 1936), quotes an instance of a typical town in the coal-mining and steel area in South Wales which has 60.6 per cent. of its industrial insurable population unemployed. He instances a case, again typical, of a miner who, when employed, is 6s. a week better off than when unemployed. Similar examples could be given of towns in the coal and steel districts in Durham, Northumberland and Scotland. They have been referred to and described by nearly all the capitalist newspapers. The results of the chronic depression in these industries are appalling. Wide areas are derelict, bearing all the aspects of intense poverty, drabness and malnutrition. The Daily Herald (November 6th, 1936) reported a case of a shipbuilding worker who had not worked at his trade for 16 years. Innumerable cases have been reported of men in their twenties and some nearing their thirties who have never worked. Edward VIII, after his recent visit to the depressed areas in South Wales, said, “Something will be done.” The extent to which ”something will be done,” we prophesy, will not touch the fringe of the problem.

[From an article by H. Waite, Socialist Standard December 1936.]

50 Years Ago: Major Douglas and Unemployment (1986)

The 50 Years Ago column from the November 1986 issue of the Socialist Standard

Nothing shows up so clearly the failure of Major Douglas and his followers to understand the nature of capitalism as their inability to explain the ups and downs of production and trade. A case in point is their forecast of constantly increasing unemployment.

In its issue of January 25th. 1934. the Douglas journal, New English Weekly, wrote:

As technology develops, there will be a growing mass of unemployed — 20 per cent. 30 per cent. 40 per cent or more — who are deprived of all demand-power, except such as we allow them by way of the dole.

Now let us contrast that prophecy of unemployment increasing for 20 per cent to 30 per cent, 40 per cent and more, with the actual happenings, as shown in the Ministry of Labour returns as to the percentages of insured workers unemployed. 

January, 1933 23 per cent.

January, 1934 18.6 per cent.

January, 1935 17.7 per cent.

January, 1936 16.3 per cent.

June, 1936 13.1 percent.

September. 1936 12.4 per cent.

In due course capitalism will experience another crash and then the Douglasites. silent as to their past failure, will rush into print, repeating their fallacious theories and prophecies.

[From an article "Douglasites Floored by Facts'", Socialist Standard, November 1936.]

Have pity on them (1947)

From the November 1947 issue of the Socialist Standard

At times the many-sided interplay of World Affairs presents a confused and complex character that does not permit of ready and facile interpretation. To admit that often we are only wise after the event is not necessarily a confession of a lack of one’s powers of perception or a deficiency in native intelligence.

It may also be that in this process of becoming wise after the event there are some who take longer than most. It may even be that there are others who never become wise about events at all.

Which brings us to Mr. Clynes’ article, “When Crisis comes to the Cabinet.” (News of the World, l4/9//47.) Mr. Clynes also sketches there what, for him, were apparently the essential features of the 1931 economic crisis. That crisis happened sixteen years ago, a fair period you will agree for cogitation and reflection on what it was all about. After reading Mr. Clynes’ article we can only conclude that sixteen years has not been long enough for him to have become really wise after the event.

Mr. Clynes, who was Home Secretary in the 1929-31 Labour Government, says that during crises he has been behind “closed doors.” He means 10, Downing Street, of course. With such qualifications he offers the newspaper’s readers “a picture of what happens.”

Perhaps the ”negative” of the picture has remained in “the dark-room” of Mr. Clynes’ memory too long. For, to use a slightly technical term, the picture is sadly lacking in definition and detail. Instead of a clear-cut impression of the real political significance of the events produced by and associated with, the 1931 crisis there is merely a confused blur of disconnected incidents and trivial political minutiae. Thus we get a presentation of “day by day Cabinet meetings, of men with white strained faces, going painfully over one scheme after another to meet a frightening situation.” Of strained nerves and tempers. The sudden bitter enmity of life-long friends. A broken-hearted and bewildered Cabinet deserted by their leader, Ramsey MacDonald, and so on. Touching, no doubt, but scarcely enlightening as a piece of political history.

Neither does any word issue from the lips of the chief characters in the picture to indicate in the slightest what the real nature of the Cabinet Crisis was. Indeed, so far as the understanding of events being gathered from what at the time was said, its significance apparently is to be found in what was not said. For Mr. Clynes’ tells us that not only was MacDonald reticent to the Cabinet concerning a visit to him in the early crisis days by the private secretary of King-George V, but, moreover, he refused to disclose to them what had passed between the King and himself at a Buckingham Palace interview. One could comment that MacDonald’s preference for a silent part in “the picture ” was indeed a rare choice for perhaps the most garrulous politician of the age.

In spite of the apparently crucial importance which Mr. Clynes rather obscurely attaches to MacDonald’s silence in the matter of the crisis, we could assure him—if that were needed—that whatever passed between King and Premier in the crisis talk would not have materially affected the nature of the 1931 economic crisis or the main trend of events which resulted from it.

The fact that MacDonald refused to spill the beans on what was said is open to the more charitable suggestion that so far as any concrete proposals about the handling of the crisis was concerned he had no beans to spill. It may even be that he didn’t discuss the crisis with the King at all. After all it is Secret History and our guess might be as good as anybody’s in the matter.

Mr. Clynes does, however, inform us that MacDonald and the Cabinet had agreed on matters which it seemed were regarded as unalterable; although about the question of what these matters were, Mr. Clynes himself is highly reticent. Albeit MacDonald altered the unalterable by the simple device of continuing his Premiership with the aid of the Tories instead of that of the Labour Party.

Mr. Clynes, anxious perhaps to cushion any criticism of his party’s failure to effectively deal with the problems of Capitalism in so far as they affect the workers’ interests, assures us that Ministers are fallible human beings. We, of course, have never said anything to the contrary. To which he further adds a somewhat tearful, spare a kind thought for the poor politician plea, by exhorting us “in our own worry and uncertainty to have Pity on them.”

It would seem that only at Election Times does the cloak of Papal infallibility fall upon the shoulders of political spokesmen. Only then, with much fingering of their political rosaries, do they proclaim with almost divine assurance to the electorate that “They are the Way, the Truth and the Light.” Only then does isome leader take on the role of a political Moses whose mission it is to lead the workers into “The Promised Land.”

It is only when political parties have become the Government of the country that they discover they are liable to be the prey of the mysterious and malignant economic visitations popularly known as “Blizzards,” “Catastrophes” and “Disasters” and for whose coming they assume no responsibility or claim any real control. It is these things which it seems set to nought their good intentions and bring to dust their political programmes and promises. In this manner do “our statesmen” translate the economic contradictions of Capitalism into librettos for the eternal political theme of the struggle between the Forces of Good and The Powers of Darkness.

Mr. Clynes tells us that Ministers “are, perhaps, family men each with domestic worries and as deeply involved as the rest of us in the common disaster which threatens our common citizenship.” No doubt this touching spectacle of the domestic worries of Ministers, such as paying the rent, meeting the milk bill or the uncertainty of the next meal, getting all mixed up with the affairs of State, is a sombre reminder of the price that has to be paid for “Democracy.” Whether the Fascist Dictatorship can be explained by the fact that Hitler was a bachelor up to the last few days of life and presumably had no family responsibilities, might engage the attention of those “psychological gentry” who are always trying to explain social and economic events by processes which have nothing to do with them. Nevertheless both Goebbels and Goering were family men and for that matter, so was Mussolini.

Doubtless, the raising of families by our Ministers is a worthy and human concession to the democratic notions of our age, but what precisely its connection is with the objective cause of the economic crises of Capitalism, Mr. Clynes fails to explain.

Mr. Clynes then tells us that “as the result of an half-an hour’s angry disagreement we were going out into the desert deprived of four-figure salaries, secure positions, the confidence of bewildered supporters and indeed of any political future for which we had painfully given our working lives.” This, indeed, must have been the supreme moment “When Crisis comes to the Cabinet.” In view of all this it will not perhaps come as a surprise when he informs us that among the varying emotions experienced by some of his colleagues, avarice was one of them.

And if the gentle reader impatiently asks what has all this to do with the political and economic events of the 1931 period, we can only say that it is Mr. Clynes’ article on the crisis and not ours.

Nevertheless Mr. Clynes does make some attempt to more realistically portray how the crisis came to Britain. For instance we are informed that foreign countries’ confidence in Great Britain was shaken—a not altogether unknown phenomenon in this country’s history. As a result of this lack of confidence “shipload after shipload of gold was loaded at the docks and passed overseas.” “At every bank queues of people tried to draw out silver and notes. Business almost stopped.” Again, £10,000,000 in gold was withdrawn and the Bank of England was by an emergency Act relieved of the necessity to pay out gold on demand. To remove any possible misapprehension these shiploads, of gold were not the nest-eggs of the working class becoming an article of export. Neither were the bank queues those of workers trying to draw out their “savings” as a preliminary to departing to sunny climes. The “going off the Gold Standard” in this country was of no vital concern to the workers because they had never been on it. Indeed the only standard the working class have ever been on in the present system is, a “Copper” one and that will remain their money evaluation as a class, whatever financial arrangements the capitalist class come to in times of crisis.

For Mr. Clynes, however, the cessation of the normal functions of The Bank of England indicated that “Britain shivered on the verge of catastrophe”.

To cap it all that other great working class institution, The Stock Exchange, closed down temporarily. However, those other working class institutions, the Labour Exchange and the Public Assistance Committee, were very much open and marked by a continuous and feverish activity.

“Then,” says Mr. Clynes, continuing his crisis theme, “for no apparent reason confidence returned.” “At mid-day Treasury officials felt a degree of terror. By the afternoon speculators were buying instead of selling . . . the tide had turned … a great crisis was weathered.” Such a description of the nature of the crisis strongly suggests a marked affinity with that vague and unaccountable phenomenon called an Act of God.

At a less sensational level we could offer the somewhat more accountable explanation, that the year 1931 was witnessing one of those familiar trade cycles which Capitalism is periodically subject to. Also the fact of going off the Gold Standard was merely an effect—not a cause of the crisis. Capitalists all over the world, faced with glutted markets and unsaleable stocks, were not only anxious to cut their commitments but were demanding gold as the means of payment in any transaction that occurred. Other Capitalists and their financial institutions were busily trying to call in loans, in view of the slump. Faced then, with the catastrophic decline of international trade it was inevit able that the creditors of British Capitalism should seek bullion as the only means for liquidating debts incurred. Thus a heavy drain on the Bank of England’s gold reserves was an automatic consequence of the conditions brought about by general and chronic “overproduction.”

To explain a capitalist crisis of “overproduction” in terms of financial panics and stringency is like attempting to explain Delirium Tremens by the patient’s shudders and shivers. Although Mr. Clynes tells us “that the crisis in money was passed” a few incidental features of the crisis, like nearly 3,000,000 unemployed, economy cuts, falling wages, distressed and devastated areas and the general intensification of poverty, remained for some years. Such crisis events, however, are not the best kind of reminiscences to keep for one’s political old age. Neither perhaps do they constitute the best form of Sunday afternoon reading for the working-class readers of the News of the World.

We have, of course, on other occasions dealt with some of Mr. Clynes economic fallacies, as far back as 1919 and as recently as the June Socialist Standard of this year. Undoubtedly Mr. Clynes’ consistent propaganda in “more production” campaigns has revealed him as an untiring advocate of harder work for other people.

But Capitalism is a profit-motive economy and it is profit anticipation which not only determines how wealth is produced but in the final analysis how much is to be produced. Thus with every increase in wealth-producing efficiency a greater quantity of goods are enabled to be thrown on to the market. Workers’ wages constituting but a fraction of the wealth they produce, it is insufficient to absorb the ever greater amount of the goods turned out by them. In the case of the Capitalists their effective ability to consume the products of labour is fixed by the limits of their personal and physical capacities. Hence a greater portion of their “surpluses” tend to go into greater investments of those industries which turn out productive goods,. The contradiction between the expanding forces of production and the limited class income distribution inherent in Capitalism is thus intensified. It is this which finally leads to glutted markets. Effective demand ceases, or to put it another way, a condition is reached where no purchasers can be found. Profit anticipation then declines or disappears. Production is, then curtailed; plants close down; workers are dismissed and all the familiar conditions of a slump make their appearance.

Thus Mr. Clynes’ sovereign remedies—greater productive output on the part of the worker—for dealing with unemployment and low wages, provide the very means for bringing about in a shorter time those very conditions which he seeks to obviate.

It would appear that Mr. Clynes has been so busy during his life, assisting or seeking to assist in the administration of Capitalism that he has never had time to acquaint himself with a few simple facts about the system he has, helped to run. Thus do “Practical Politics” keep our statesmen, so far as the understanding of this present system is concerned, in a perpetual economic “Egyptian Darkness.”

Should we then include Mr. Clynes among those politicians he asks us “to have pity on?”

Ted Wilmott

The Shorter Working Week in Australia: What it means to the workers (1933)

From the October 1933 issue of the Socialist Standard

At the present time, throughout the world, there is much talk about the shorter working week. Mussolini has made some suggestions to the League of Nations .on the question; President Roosevelt has intimated that he intends taking steps to reduce the working week in the United States; the Australian Trade Union Congress carried resolutions calling upon workers to organise to bring about a reduction in hours so that unemployment might be decreased. Recently the workers in Queensland applied to the State authorities for a forty-hour week.

In addition to the above the Communists have been agitating for a thirty-hour week of five days. In a pamphlet issued by the Communist Party of Australia, in 1931, entitled “The Communist way out of the Crisis," we find the following: —

By introducing the seven-hour day and the five-day week, and by raising the purchasing power of the masses, we will abolish unemployment. (Page 6.)

The shallowness of the Communist Party's economics is revealed here; even the Trades Union Congress did not propose to abolish unemployment with its thirty-hour week.

Less Hours—More Wealth

The history of capitalism shows that the introduction of a shorter working week does not mean the absorption of more workers to keep up the output. When the factory system began there were few regulations governing the length of time a worker could be kept on the job. Sixteen and eighteen hours per day in English factories was a common occurrence; workers were worked even longer, and such conditions exist in many workshops in Japan to-day.

In England the twelve-hour day became general and, subsequently, by legislative enactment, the ten-hour day was introduced. In Australia, for many years, there has been a legally-fixed eight-hour working day, and it is a proud boast of many old-timers that they participated in the fight for eight hours’ work, eight hours’ recreation, and eight hours’ rest. In some individual workshops such as Lever Bros., Port Sunlight, there is a six-hour working day.

Recently, in Sydney, New South Wales, the Industrial Commission inquired into the question of the working week. The Government desired to restore the forty-eight instead of the existing forty-four-hour week. The President of the Trade Union Secretaries’ Association presented the following remarkable facts at the inquiry:—

“The productive capacity of the industries of this State was greater than those in Victoria before the introduction of the 44-hour week in New South Wales, and was greater since the introduction of the shorter working week; also that for a given amount of goods the percentage outlay on wages in New South Wales was less than in Victoria (48-hour week) and the margin available for profit and interest was greater in New South Wales than in Victoria prior to and during the operation of the 44-hour week.

“A table of statistics from official sources showed that the percentage of wages to value of output in 1930-31 was 21.7 in New South Wales, and 22.86 in Victoria. The average value of production per employee was: 

"The average production in New South Wales had been considerably higher in this period, which included the depression year, than in Victoria. In the years 1926-7 to 1929-80, when the 44-hour Act was enforced in New South Wales, the production per employee rose by £21 in New South Wales and by £3 in Victoria—SEVEN TIMES GREATER.

"These figures demonstrated that a reduction in standard hours not only maintained but improved the productive capacity of employees”

(Labour Daily, 17/3/33.) 

Yet, in the same issue of the Labour Daily, Alderman J. S. Garden, of Sydney City Council, Secretary of the Trades Hall Council, prominent member of the Australian Labour Party, and one of Mr Lang’s foremost boosters, while speaking on unemployment, stated: —

“ . . .  the people who were advocating 'complete socialism or nothing’ were talking absolute nonsense. . . . The basis on which the forthcoming campaign is to be waged will be a thirty-hour working week, restoration of wage cuts, etc. . .

(Labour Daily, 17/3/33.) 

The knowledge that the “forthcoming campaign” will be based upon the advocacy of a shorter working week will bring little consolation to the workless after they glance through the statistics set out above.

These statistics reflect the result of the application of more up-to-date machinery to the productive process. The employers invariably find ways and means of adjusting their plant and methods when such concessions are forced from them. When we point this out we are not to be taken as being against the introduction of a shorter working week; we merely stress its ineffectiveness as a solution for unemployment.

As long as the means of production are owned and controlled by the capitalist class, that class will reap the benefits of the increased application of machinery. They own the products and decide how they will be distributed.

The lesson to be learned is that if the workers, as a class, are to gain from improvements in the means of production, they must organise on a class basis for the conquest of political power to bring about the common ownership of the means of wealth production. This is the aim of the Socialist Party. What about falling into line with us, fellow-workers?

W. J. Clarke,

Socialist Party of Australia, Melbourne.

Jarrow: the truth that was murdered (1986)

From the October 1986 issue of the Socialist Standard

Jarrow is a trigger word for the British labour movement, detonating emotions, prejudices and false reputations; for half a century it has given nourishment to the misconceptions of Labour politicians. Fifty years ago this month the Jarrow march (it called itself a crusade) set out to bring a petition to parliament from the stricken Tyneside town. It was, to be sure, a moving episode in working class history. now to be celebrated by another march which will climax with the presentation of another petition, worded just as it was in 1936. Most of those taking part will no doubt be sure that they are doing something significant about unemployment and poverty. The crucial question will evade them: why must it happen again, fifty years later?

Labour's propaganda victory of the 1940s was largely based on their asserting that prewar poverty and unemployment was the result of the policies of a heartless Tory government. In support of this, free use was made of photographs of events like the Jarrow march, with nostalgic references to the town's Labour MP, Ellen Wilkinson. In this way the Labour Party succeeded in identifying itself with the march and with the idea that, had they been in power at the time, there would have been no reason for it to happen. In fact the march was not a Labour Party demonstration; it was a protest on behalf of the whole town, the petition was carried jointly by the Conservative and Labour agents and at the time a truce was observed in the local elections. Even more: far from supporting the march the Labour Party and the TUC condemned it. At the Labour conference which took place while the march was on the road the NEC representative made a scathing attack on Ellen Wilkinson. The TUC advised all trades councils to ignore the march. Of course not all of them took this advice but when they did hospitality was often provided to the marchers by the local Conservative Party, or the Territorial Army, or businessmen.

Jarrow's established reputation for militancy comes from its mistaken association with the marches of the National Unemployed Workers' Movement, which happened regularly in the 1930s and which were larger, more demanding and often riotous. Jarrow was anything but riotous; it would be more accurate to describe it as a company town. As it developed during the second half of the 19th century its central industry — in effect its only one — was C. M. Palmer's shipyard, which took advantage of the change from wooden to iron ships to develop a screw-driven collier. Palmer's financial policies have been described, in retrospect, as "exuberant'. which implies that they were recklessly optimistic but at the time they could have had few critics. By 1860 the company was dominant among the iron ship builders of the Tyne. It had grown into a huge, integrated business with its own ironstone mines, its own port, its own coal mines and steel furnaces. Palmer's workforce included a large proportion of highly skilled men such as boilermakers and ship wrights. the kind who are sometimes referred to as an ''aristocracy of labour". Until 1921 Jarrow was, by working class standards, one of the better-off towns, where wages were relatively high. Its people were confident that things would stay that way.

This was reflected in the way Jarrow voted. Until the turn of the century it was a Liberal stronghold. Before 1907 the Unionists would not even contest the seat and one Labour MP grumbled that "There was never a more hopeless constituency for a Labour candidate to attack than Jarrow in the nineties. Sir Charles Mark Palmer, the sitting member, was the most popular man in the north of England". The secretary of the Jarrow march described the place as "more a Tory town than it is a Labour town". After Palmer's death in 1907 the Labour Party won the seat but it then changed between Labour and Liberal until 1929, when a Conservative won there, inflicting on Labour their second worst result in the North-East. When Ellen Wilkinson won the seat in 1935 the Tory vote was as high as 47 per cent. Wilkinson had been a member of the Communist Party, changing to Labour when the Labour Party made it impossible to be a member of both parties. She accumulated the familiar reputation for fearless militancy but — and this again is a familiar story — her career peaked when she became Minister of Education in the 1945 Labour government, which was continually at odds with the Communist Party over its policies both at home and abroad.

In many ways Jarrow represented the economic changes which were forced on British capitalism during the first half of the 20th century. By the 1930s it was accepted by all but the hardest of die-hards that British capitalism had lost for good many of the export markets which it had once dominated and on which so much of its wealth and power rested. As heavy industry and mining, located mainly in the North, went into decline capital was switched to lighter, consumer-orientated industries in the Midlands and South. Jarrow's dependence on Palmer's made it particularly vulnerable in any such movement; the First World War demand for shipping postponed the inevitable but by 1921 the brief post-war boom was at an end and shipbuilding was badly hit. In December that year 36 per cent of the industry's workforce were unemployed, by the following August in Jarrow 43 per cent were out of work. Palmer's were unable to take advantage of the partial recovery which followed and Jarrow might be said to have led the way into the slump of 1929. In July 1932 Palmer 's launched its last ship and in 1933 the yard was closed. By 1934 there were 67.8 per cent of the town's insured workers unemployed, by 1935 it was 72.9 per cent and by 1936 it had reached 80 per cent.

J. B. Priestley, in his English Journey, described Jarrow as he saw it in 1933: "Wherever we went there were men hanging about, not scores of them but hundreds and thousands of them". The town had long suffered a high incidence of tuberculosis — the result of bad housing, malnourishment and topography — in spite of its relative prosperity. In the 1930s the rate of TB rose to double the national average. In 1934, when the infant mortality rate was 47 for each thousand live births in the Home Counties, in Jarrow it was 114. So alarmed was the Board of Education at the malnutrition among Jarrow's schoolchildren that they sent a request to the council to increase free school meals.

Little wonder that Jarrow should feel, in its desperate plight, that an especially harsh discrimination was being applied to it. If, as the title of the famous book has it, it was The Town That Was Murdered who., or what, did the killing? During the recessions of the 1920s and the 1930s some industries attempted to defend themselves by forming cartels with the object of restricting (they called it "co-ordinating" or "rationalising") production and marketing, in the hope that this would enable part of the industry to survive in profitability. Much the same thing happens now in. for example, the oil industry. The steel industry organised the British Iron and Steel Federation, which set itself to oppose any efforts by non-members to open up production. It was opposition from the BISF which caused the abandonment of a plan for an integrated steel plant in Jarrow — the event which sparked off the march.

The shipbuilders' cartel was National Shipbuilders Security Ltd. set up in 1930 with most of the industry and the big banks as shareholders. The NSS was financed through a levy on its members and its object was to buy up shipyards and then "sterilise” them. By 1934, in this way, it had finished off 137 berths, or two-fifths of the British industry. with a production capacity over a million tons. Among them was Palmer s yard at Jarrow, which went into receivership in 1933 and was sold — delivered up to — the NSS in 1934.

With their dreams and their confidence in tatters, it was tempting for desperate, starving workers to think of Jarrow as being murdered. cut off in its prime, by a small group of greedy capitalists supported by a pitiless government. This is a common enough reaction to unemployment; it goes with the theory that capitalism's problems — its disorder, its crises, its inadequacies — are abnormal and could be avoided by running the system differently. Jarrow, it was said, was the victim of a monstrous crime and crime is. or should be. abnormal.

By the standards under which capitalism must operate, what happened to Jarrow was perfectly normal and reasonable. This society does not produce wealth to meet people's needs, or employ them so that they can be healthy and happy. Its wealth is produced for sale on the market, intended to yield a profit to the minority who possess the means of production and distribution, including things like steel works, mines, shipyards and ships. Workers are employed, that is to say their labour power is bought by the capitalists, in order to turn out that wealth. But it is impossible to predict how the market will behave, to control it. to guarantee that it will always absorb what has been produced. That is why every so often there is a "surplus" of some sorts of goods, however much people may need them. When sales are high, in a boom, "exuberant" investment policies are praised as divine wisdom; in a recession they are condemned as blindly irresponsible. So it was with Palmer's; had things turned differently the company would have been a favourite among the economic experts and the apologists for capitalism as a masterpiece of financial and industrial genius.

Jarrow was badly hit in the slumps of the 1920s and 1930s but it was not alone for the entire shipbuilding industry was in decline. In 1920 British yards turned out over 2 million tons but by 1933 this had fallen to 133.000 tons. In 1932 the industry had nearly 60 per cent unemployment; that was the year when, according to the Home Office, two unemployed men committed suicide every day. There was a similar story in towns which had depended on other branches of heavy industry; Dowlais. Brynmawr and Motherwell, for example, all had unemployment at about 75 per cent in 1934.

Some of this must have been in the minds of the Jarrow marchers, as they assembled for their trek to London. This was one of the smaller of the many protest marches of that time — 200 selected men compared to the thousands who would take part in the demonstrations organised by the NUWM. It did not demand better benefits or more humane treatment for the unemployed; its object was to persuade the government to direct investment into the town. The marchers were generally regarded benignly by the police (Special Branch kept close observation on all demonstrations by the unemployed for no matter how desperate working class poverty may be it could be permitted to arouse only the best-mannered of protests), the press and the government — in contrast to the NUWM marches which were battered with relentless sneers and criticism and, by the police, with unprovoked assaults.

As the Jarrow men made their way to London The Times congratulated them on their stoicism and sympathetically reported their blistered feet and their fatigue. They enthusiastically cheered King Edward VIII. who happened to be passing by in The Mall. The Home Office agreed that, as ". . . the marchers show every sign of being orderly, it would be a good way of encouraging them and placating them" to allow them to be entertained in the Houses of Parliament. Taking tea with the MPs was hardly the way to bring down capitalism, or even to change its course. Even more, friendly Members took them on a boat trip down the Thames, which caused them to be absent from the climax of the march — the presentation of their petition. They also missed the government's response, which was bluntly translated for them by a Jarrow councillor: "It means you have drawn a blank". The next day the Jarrow men caught the train back home, to the end "well disciplined . . . conduct was exemplary" in the words of the police report.

Apart from putting the town's name and that of its MP — into the history books and the laying out of one small public park, there was nothing to show for the Jarrow march. Its objectives were restricted and short term but even at that they were beyond its reach. No government can change the nature of capitalism or divert it from its natural course and that was why they had to refuse to do anything to revive industry in Jarrow. They even stopped the marchers' unemployment pay, on the grounds that they were not available for work for the period of the march (there was, of course, no work in Jarrow for them to be available for. but never mind). Capitalism continued on its troubled way; while Jarrow agonised the excessively rich Tory MP Henry Channon set out in his diary some of the difficulties his class were experiencing in early 1937:

[I] had a large dinner party . dinner was magnificent. Lady Granard could hardly walk for jewels.

And later that

I find a new, unexpected joy at the age of nearly forty, in accumulating money and watching it grow.

Those appallingly smug words illuminate the real social and political issue, in the 1930s and now — the class division of society based on the private ownership of the means of life. As Channon wrote, one per cent of the population owned 56 per cent of the wealth in private hands. The situation is very little different today. The social system which exploits and impoverishes the majority, which forced the men of Jarrow to that moving, fruitless crusade, remains in being. Now. after another post-war boom, we are in another recession which again has affected the shipyards of the Tyne. Unemployment in the area is at 25.6 per cent. This is what brings the people of Jarrow to London once more, to set down their protest at the effects of capitalism but giving no thought to abolishing the system. That the famous march must happen again, fifty years on. is no cause for celebration for it demonstrates how futile it was in 1936 — and how futile today.

Ivan

50 Years Ago: Labour Government in Australia (1982)

The 50 Years Ago column from the October 1982 issue of the Socialist Standard

Using “the preservation of Arbitration” and the protection of the living standard as a catch-cry, the Scullin Labour crowd were successful in gaining the confidence of the workers. They began grappling with the problems. It is here we get an insight into the real nature of the “Labour” Party. Under the slogan of “Build up Australian Industries,” benefits were gratuitously bestowed upon the Australian manufacturers, and the workers were callously disregarded.

The tariffs were revised, and more than 150 items were adjusted in the interests of the sections of the capitalist class represented by the “Labour” Party.

. . . But the services did not end here. During the last year of its regime the “Premier’s Plan” was introduced. Under this plan, on the plea of reducing government expense, the wages of public servants were ruthlessly reduced. Pensions of ex-soldiers and old people were chopped by 12½ per cent., and the maternity allowance was cut down similarly. The wages of all workers governed by Arbitration Court Awards were reduced by 10 per cent.

[From an article The Australian Labour Leaders by W. J. Clarke, Socialist Party of Australia, Socialist Standard, October 1932.]

Unemployment in the 30s and the 80s (1982)

From the August 1982 issue of the Socialist Standard

Every one of the political parties in this country (except the SPGB) claims that it has a policy which, if the government applied it. would reduce capitalism's unemployment to a very low level and keep it there. It was the late Hugh Gaitskell, leader of the Labour Party, who wrote in 1959:

The great ideal of jobs for all first became a peacetime reality under the 1945 Labour government . . . The first objective of the Labour Government will be to restore full employment and preserve full employment. 

They had to wait five years, until October 1964, to see a Labour government in office again. At first it had some luck, in a small decline of unemployment in 1965. Emboldened by this. John (now Lord) Diamond, who was Chief Secretary to the Treasury, explained to the House of Commons on 1 March 1966 how this fall had been the result of government policy, and “that is how we propose to continue doing it". Then the government's luck ran out. Instead of unemployment remaining at 371,000, as instructed by Diamond, it jumped in 12 months to 631,000. and when the Labour government left office in June 1970 the Tories were able to show that unemployment was 200,000 higher when it took office.

But the Heath government which followed was equally unlucky. They, too, were pledged to “full employment" but saw the total rise from 582,000 in June 1970 to nearly a million in 1971 and 1972. Then came the Labour government of 1974-79, during which unemployment more than doubled, followed by the Thatcher government under which it has more than doubled again. All four governments from 1964 to the present time have been sailing on a rising tide of unemployment and there was nothing any of them could do about it except wait for it to subside in capitalism's own time.

However, though the governments cannot do anything about the amount of unemployment, the party politicians can indulge in an old game of challenging the official figures. This needs two teams, the opposition and the government, though anyone can join in. An accepted rule of the game is that the opposition, whether Tory or Labour, is on the attack, and the government, whether Tory or Labour, is on the defensive. Points are scored by the opposition when it can plausibly argue that the real number of unemployed is higher than the official figures; and by the government when it can counter the charge or claim that unemployment is really a blessing in disguise.

There was a splendid match in the winter of 1971. It was then that the official figure nearly reached a million and the Heath government had to meet the charge that the proper figure was higher. But how much higher? The Financial Times (11 December 1971) suggested that it was perhaps 1,250,000! The Observer (23 January 1972) quoted an estimate of 1,500,000. but in a later issue (23 February 1972) thought it might be 2,000,000. Not to be outdone Harold Wilson (Financial Times, 8 April 1972) put it at "nearly 3.000,000", and Peter Jay (The Times. 9 March) reckoned that it was "over 3 million”. An official estimate was that there might perhaps be 400,000 out of work who were not on the register, which would have given a total of 1,367,000.

Basically the official figures of unemployed on the register were, and are, disputed on the ground that a lot of unemployed workers do not trouble to register — including, in recent years, some redundant workers who do not seek work while they are spending their redundancy pay. The official figures are arrived at in the monthly count of the number of people available for, and genuinely seeking, work. The more extravagant estimates of a higher figure include guesses at the number of people, particularly married women, who are not seeking work but might perhaps do so if they could see that vacant jobs were available at sufficiently attractive rates of pay.

Faced with these embarrassing estimates of much higher unemployment the government at the time thought up some counter arguments to show that real unemployment was actually less that the official figures. They said that the large number of people they described as "unemployable” ought to be taken out, as should those registered unemployed who were only in the process of changing jobs, with a gap of a few weeks in between. And what about the people improperly included in the register who were secretly doing jobs on the side?

The most ingenious government defence came from John Eden, Minister for Industry, who said that the large number of unemployed on the register "reflect in part the redeployment that is under way"; meaning that it arose out of the government's policy of moving workers from contracting industries into expanding ones. "We can now look forward to what could be our greatest period of sustained growth in decades" (Financial Times 11 December 1971). The Thatcher government has had to fall back on the argument that the unemployed largely owe their condition to having pressed for too-high wages, and that it will take a long time for Tory policy to get things right.

In the politician's game about the unemployment figures points are scored by the opposition if they can claim that unemployment has reached a record level. For months on end. during the Labour government of 1974-79. the Tory opposition was able to do this, as unemployment climbed by over a million, from 629,000 to 1,636,000 in 1977. The form of the attack was that the figures were “a post-war record". Latterly, Labour Party politicians have been saying that the present figure of 3 million is “the highest ever recorded". The intention is to convey that unemployment now is greater than it was in the 1930s which it certainly is not.

The point is that the severity of unemployment has to take into account not only the number of unemployed but also the total number of workers to which it is related. For example, 2 million unemployed out of 10 million workers would be twice as severe as 2 million unemployed out of 20 million workers. Firstly, in 1932, the total number of wage and salary earners was perhaps about 19 million compared with the present 24 million. Secondly, fewer than 13 million of the 19 million were covered by the Unemployment Insurance Scheme and the official figure of unemployment in 1932 (over 2,900,000) took into account only those of the unemployed who were insured. If unemployment was as severe among the other 6 million workers as among the 13 million who were insured, the number of unemployed would have been shown as well over 4 million. Among the workers who were not insured were agricultural workers and non-manual workers generally.

Writing about unemployment in 1936, when it had fallen far below its peak of 1931-2, G.D.H.Cole dealt with the point:

There are, as we write, roughly 1.600.000 of them in Great Britain in the insured trades alone, there are really a good many more altogether; for there are also 110,000 uninsured workers on the register of the Employment Exchanges and an unknown number more who are neither insured nor registered. (The Condition of Britain, p. 219.)

Cole mentioned that at that time there were nearly 250,000 unemployed coal miners.

In 1932, when there were over 2.900,000 unemployed insured workers, on the register, it is the fact that 23 percent of the insured workers were out of work which gives a more accurate picture of the severity of unemployment generally, among both insured and uninsured workers. Unemployment was therefore very more severe in 1931-32 than it is in 1982. when it is 12.8 percent. The same is true of the United States where unemployment in 1933 was over 25 percent, compared with about 10 percent at present. Needless to say the “numbers” game was in full swing in the 1930s and with even more scope for guessing, since nobody knew how many of the millions of uninsured workers were out of a job.

As unemployment under the Labour government had risen from 1,164,000 (9.6 per cent) in June 1929 to 2.813.000 (21.9 percent) in August 1931 when they went out of office, they got a little satisfaction from seeing it go on rising under the National government which followed. Among the points made in the Labour Year Book 1932 was that a seeming 60,000 drop of unemployed among women late in 1931 was due to “changes in the conditions for the receipt of unemployment benefit, by which the claims of a large number of married women were disallowed”.

Of course the Thatcher government’s much-heralded recovery has not yet produced results, and unemployment might yet rise to the levels of the 1930s.

Edgar Hardcastle

So They Say: They Pretend Malnutrition, too (1974)

The So They Say Column from the March 1974 issue of the Socialist Standard

They Pretend Malnutrition, too

A new addition to saloon-bar political mythology has arrived. It joins the Man Who Gets Twice as Much on Social Security as he does Working, the Black Man Who Buys Kit-E-Kat for his Sandwiches (yes, my grocer told me), the Eight Workmen Who Came and Lolled About Smoking When All I Wanted was a Screw Tightened on my Cooker, and so on.

This happy arrival is the Family Only Pretending to be Homeless. Its career was launched in the London Evening News on 18th January:

A housing chief has announced a clampdown on the “phoney homeless”. Some families are suspected of faking evictions to gain council homes. Only couples with children, facing complete family breakdown, are now likely to get official help in Hertfordshire.

Presumably you must spend a minimum of three nights on the pavement and get down to six stones per adult member of family; otherwise you’re only pretending. A family with a room to itself that wants a whole council house are sheer Epicureans, and we don’t stand for them in Hertfordshire. Take it from me, councillor, my nephew’s milkman knows this lot

No, it's Different Now

One trouble with the working class is its memory. How can you expect to get on and please the government if you forget the right things, like standing up for the Queen, and remember the wrong ones, like unemployment and politicians’ promises?

Thus, the masses have watching TV films about the war in which the Germans are shown as the hateful enemy. In the last week of January Die Welt published an article by its London correspondent Christian Ferber protesting about this. Sure enough, he was supported. A Reverend, among others, wrote to The Guardian suggesting “restoring the balance” with some programmes about good Germans in the war, specially POWS who “were permitted to visit churches and other organizations”,

People must really arrange their memories better. Saying they had to hate the Germans for six years is no excuse. If villains are shown today they should be Russians. But in the war weren’t they glorious allies or something? There you go again.

Please Spare a Copper . . .

Readers of the financial pages cannot fail to notice that profits and dividends show little sign of wilting because of the crisis. Some companies are doing well out of it. A typical example was shown in The Guardian's business section on 6th February. Under the heading blessing in disguise the buoyant position of Central Wagon, the steel stockholding and hydraulic equipment group, was described:

The company’s sales in January this year are 50 per cent up on the monthly average for the previous year . . . When the 1973 results are announced, the profit is more likely to be around the £900,000 mark—well beyond the company forecast of about £670,000 . . . Central Wagon is confident that it will produce still higher profit in 1974 —even after allowing for the miners’ strike.

But when times are bad, are they not bad for the owning class too? Were there not tales in the nineteen-thirties’ depression of ruined rich men queueing to throw themselves from high buildings? Untrue. Britain in the Nineteen Thirties by N. Branson and M. Heinemann (1972) says:

True, profits fell in the slump years (by 30 per cent at the lowest point, in 1932), but since a higher proportion of profits was paid out in dividends, shareholders’ incomes fell much less than this, while income from rent and fixed interest stocks remained more stable in spite of the fall in prices.

. . . Figures in the British Association’s Britain in Recovery, based on Colin Clark’s estimates, suggest a fall of 9-11 per cent in consumption expenditure of those with incomes over £250, from 1929 to 1933—which was almost certainly less than the fall in prices.

. . . for the Clerical Hat

Reach for your handkerchiefs. The Guardian of 8th February told the harrowing story of Britain’s underpaid vicars.

The [Church] commissioners, in a report to the General Synod, the parliament of the Church of England, say the average pay of the 9,000 vicars last November was about £35 a week. In addition, they are provided with a house free of rent and rates, but many have to meet the expenses of doing their job, which can be as high as £4 to £5 a week.

How sad for the clergy to have to put up with the austerity they urge on others. The world is too materialistic.