British capital in Malaysia - Part 1 (1966)

From the October 1966 issue of the Socialist Standard

Up till a few months ago British and Indonesian soldiers were butchering each other in the jungles of North Borneo. With the ending of “confrontation” Tunku Abdul Rahman, Prime Minister of Malaysia, said that it was a “victory of the forces of good against the forces of evil”. But, when it is known that this relatively small area provides over one-third of the world’s natural rubber, is a leading producer of tin— and that nearby Brunei has the largest oilfield in the Commonwealth, it becomes clear that the war in Malaysia had very little to do with a struggle between “good” and “evil”. The prizes at stake were large enough for the British government, representing the general interest of British capital, to consider it worth spending £255 millions each year to maintain its armed forces in the country. 

The original cause of British intervention in Malaya was trade. For this reason the island of Penang was rented on perpetual lease in 1786, the island of Singapore was bought in 1819 and the decayed port of Malacca was obtained from the Dutch in 1824. From these bases British “protection” was extended—so that between 1874 and 1909 the nine Malay states were brought under control. The sultan of each state signed a treaty by which he agreed to accept a resident adviser and to follow the “advice” in all matters except those that concerned the Moslem religion and Malay custom.. This arrangement still persists in the oil state of Brunei; the Sultan remains the nominal ruler but it is the British government, through its High Commissioner, which is responsible for all external affairs and defence.

Malaya in the 1880's has been described as a museum piece of Asian feudalism, roughly similar to 12th century France or Germany. But with the rapid development of the tin and rubber industries this feudal backwater found itself hurled into the modern, capitalist world. The state of the country was suddenly determined by the prices of these two commodities and no longer by civil wars between rival claimants to the throne. By 1914 the value of foreign, chiefly British; capital in Malaya had already reached $.US 194,000,000. When the Second World War broke out this figure had been dwarfed and there was something like $.US 260,000,000 of British capital alone invested in the tin mines, rubber plantations, etc. In addition there was a further $.US 82,500,000 invested in government loans, which were often floated in London. French, Dutch, Chinese, Japanese and American capitalists had all staked their claims in the rush to exploit Malayan workers, but it was British imperialism which held the whip hand. In recent years there has been some reticence about revealing the total amount of British capital invested in Malaya but some idea of its enormity can be gauged from the fact that in 1961 remitted profits on direct, foreign investment from the Malayan Federation were $.M 321,000,000. In the same year a further $.M 137,000,000 flowed into the country as private, direct, long-term investment. It would be inaccurate to picture this as a one-way process. For example, the native capitalist class in Malaya—through its government—declared its official overseas assets to be $.M 825 millions at the end of 1960. These consisted mainly of British government securities, including local authority mortgages. A clear example that the exploitation of the world’s workers by the international capitalist class is a process that cuts across all national boundaries.

Although Malaya yields approximately one-third of the total world output of tin, it is interesting to note that only some two per cent of it is now produced by the traditional dulong washers. These are individual collectors who concentrate the ore by hand, using a pan in the beds of streams. There are upwards of a hundred mines owned by British capitalists and this represents about three-fifths of the total industry. Its contribution to the profits remitted out of Malaya, taking good years with bad, is a reasonably close rival to that of rubber.

The history of the tin industry is one of desperately trying to impose some sort of order on to the chaos of capitalist production. During the inter-war period an International Tin Committee was formed whose object was “the adjustment of production to consumption and the reduction of surplus stocks by the restriction of output”. This was set up largely as a result of the slump of 1930 when tin prices fell disastrously. The verdict of economists on this attempt at enforcing price stability is that “it was unable to prevent violent short-term fluctuations in the world price”. (L. A. Mills—University of Minnesota). After the Second World War it was confidently suggested that these “short-term fluctuations” could be ironed out by means of a world buffer stock of tin. This was the method adopted when international control of production was again established in the nineteen-fifties. Just how successful this has been is demonstrated by the table below.

As can be seen, after 1958 there was a run-away increase in prices and once again the professional economists were forced to admit that capitalism reduces the most carefully-laid plans to a shambles. Thus, the Economist ruefully made the point:

The tin agreement, which is based on the manipulation of a buffer stock, and was intended to cope mainly with price declines, has been faced with unmanageable rises. The buffer stock manager has had no tin to sell since October, 1963. But, despite the long list of unsuccessful agreements, primary producers go on trying to find the ideal formula. What else can they do?  (10th July, 1965)

Any socialist could supply the answer: nothing at all, within the framework of capitalism. Only the ordered production of a socialist society provides a solution. The economists, yearning for an “ideal formula”, resemble nothing so much as the alchemists who searched in vain for the Philosopher’s Stone. (Incidentally, it has since proved just as hopeless to deal with price declines. Since January of this year, tin has fallen nearly £180 a ton on the London Metal Exchange).

John Crump

(To be concluded)

The Truth about Camborne. (1905)

From the July 1905 issue of the Socialist Standard

Much interest was manifested last month concerning the electoral activities of the Social-Democratic Federation, when it was publicly asserted, on oath, that the candidature of Cllr. Jack Jones, S.D.F., for the Mining Division of Cornwall, was being financed by “Tory gold.”

The allegation was made at a public meeting held at the Public Hall, Camborne, on Saturday, June 3rd, when Mr. James Lightwood read documents, which he and his wife had sworn to. The following are the essential extracts :

“I, James Lightwood, solemnly and sincerely declare as follows :—

“For several years past I was superintendent of a number of model dwellings situate in Seaward Street, East Finsbury, which Mr. Richards, K.C., represents in Parliament as a Conservative. I became very friendly with Mr. Richards, and on more than one occasion have I discussed with him and his friends the political aspect of the Housing question.

“I had an interview with Mr. Richards some days prior to the 23rd of January, 1904, at my house. He told me he had a friend who was coming up from Redruth. He said ‘He is a fine fellow, you will like him very much.’ As he was going he said to my wife,’ Mrs. Lightwood, how would you like to see your husband an M.P. ? ‘She replied ‘He is happier as he is.’

“On the 23rd of January, 1904, I received from, Mr. Richards a postcard in the following words :—

“Dear Mr. Lightwood,—I shall call on you on Saturday between 5 and 5.15 with a friend from Redruth, and if you are free I hope you will wait in for me or write when you will be free Saturday or Sunday after 6.

H. C. Richards.”

“On the evening of the same day I received the postcard, Mr. Richards called as appointed. He brought with him a gentleman whom he then introduced to me as the gentleman from Redruth. This gentleman was Mr. Cheux, the Unionist Agent for the Mining Division of Cornwall. On this introduction Mr. Richards left, as he said he had to be off to the House. Mr. Cheux said that he had been deputed by a wealthy gentleman in Cornwall, who was a great sympathiser with the Socialist movement, to find a man who would, stand as a candidate for the Mining Division. He said he wanted me to be the candidate, as Mr. Richards had spoken very highly of my qualifications. I declined to consider the matter. He pressed me as he said I was a Cornishman, a native of the Mining Division, and that I had worked in the mines as a boy (all of which was true). I told him that even if my qualifications were sufficient, I could not go down into the constituency without a local mandate. I suggested his applying to the Labour party for a man, but he demurred. I then suggested his applying to the Social Democratic Federation.

“On Thursday, January 28th, 1904, Mr. Lee, Secretary of the Social Democratic Federation, called on me. I knew Mr. Lee slightly. Mr. Lee said a gentleman from Redruth had asked him (Lee) to meet him at my house, and that they were anxious for me to become the candidate, and that a rich friend of the Redruth gentleman would find the money. Mr. Cheux did not, however, turn up while Mr. Lee was with me, .but a few minutes after Mr. Lee had gone he called. He apologised for being late and hurried off to catch Mr. Lee at the office of the Social Democratic Federation. On Feb. 5th, 1904, I received a letter from Mr. H. W. Lee; this letter was written on the ordinary note paper of the Social Democratic Federation, and was in words as follows :—

“Mr. J. Lightwood,

           4, Bartholomew Buildings, E.C.

Dear Comrade,

Shortly after I reached the office after seeing you last Thursday the gentleman came up. From what he said he seemed inclined towards you yourself running for the Camborne Division. Have you seen him since, and has he said anything more to you about your coming forward ? Because if you thought of doing anything in that direction, we should be perfectly willing, I am sure, to leave it at that.

To-day another gentleman has been up. He says he comes from the one who saw me last Thursday. I gave him the decision of the Committee, which was to the effect that before we could actually decide that someone from the S.D.F. should go down to Camborne, and prepare the way, so to speak; that is to say, it would not be the best tactics, to put a candidate down upon the Division unless some preparations had been made beforehand. To this proposal he readily agreed, and stated that he had been authorised to place something of the same suggestion before us. He says he will come in and see me again before next Tuesday, when the matter again comes forward for consideration.

I thought I would let you know how the matter stands at present, and I think I will call and see you on Saturday morning at about 11, if that will be convenient for you.

Yours fraternally,

H. W. Lee.”

“A few days after the receipt of this letter Mr. Lee again called, accompanied by Mr. Green, the Treasurer of the Social Democratic Federation, and Mr. Cheux, and a fourth gentleman. They were with me over an hour ; my wife gave them tea. They all urged me to accept the position of Socialist candidate, and Mr. Lee explained that my candidature would be endorsed by the Social Democratic Federation, and Mr. Cheux urged that his Socialist friend would pay the Federation all the expenses incurred, and that the Federation would remunerate rne for my trouble. I persisted in my refusal, although they continued to urge me for a long time, but when they found I was obstinate they left, and I understood the Social Democratic Federation would find another person to undertake the job.

“I have in my possession a number of letters in addition to those to which I have referred in this my Declaration. Some from Mr. Richards, some from Mr. Lee, some from Mr. Cheux, and some from Mr. Hamilton. As these letters relate to a matter at present the subject of litigation, I am informed I should not be justified in setting them out here.

James Lightwood.

“Declared this 29th day of May, 1905. Before me,

“F. E. B. Crawley,

“A Commissioner for Oaths.”

The Executive of the S.D.F. have issued an official pronouncement, and state that:—

“It is not true that the secretary of the Social Democratic Federation, Mr. H. W. Lee, approached Mr. Lightwood about the running of a Socialist candidate at Camborne. It was Mr. Lightwood who first called at the offices of the Social Democratic Federation. It is not true that our secretary arranged to meet the “gentleman from Redruth” at Mr. Lightwood’s office. It was Mr. Lightwood who arranged the meeting, stating the time when our secretary was to call. Mr. H. W. Lee consented to call, after consulting the Organisation Committee, who agreed that he should go with a ‘watching brief’ and report afterwards. It is not true that when Mr. J. F. Green, our treasurer, and the secretary called subsequently at Mr. Lightwood’s office they found Mr. Cheux there. Mr. Cheux, they assure us, is absolutely unknown to them, and his name has never been mentioned in connection with any proposed Socialist candidature in the Mining Division. It is not true that at the interview in question Mr. Lightwood was pressed to become the candidate, or that the Social Democratic Federation offered to pay his expenses.

“Mr. Lightwood, when in London, though not a member we believe of the Independent Labour Party, and certainly not of the Social Democratic Federation, was, nevertheless, known to members of both bodies in Clerkenwell and Finsbury as a sympathiser with the Socialist movement. We were the more disposed, therefore, to consider a proposal of the character mentioned coming from him than we might have been from an entire stranger. Moreover, we were anxious to take advantage of any bona-fide offer, as for some years past members of the Social Democratic Federation who knew the Mining Division have declared that it could be won in time by a Social Democratic candidate. The Social Democratic Federation would do nothing in the way of putting forward a Social-Democratic candidate at Camborne until propaganda work had been carried on and literature distributed in order to make our principles known among the people, and until enquiries conducted by the secretary and treasurer convinced them that the offer to assist financially in running a Socialist candidate in Camborne came from a sympathetic private, arid not a political party source.

“The one important point on which the whole of Mr. Lightwood’s statement centres is that the offer to assist financially the expenses of a Socialist candidate in the Mining Division came from, or was prompted by Mr. Reginald Cheux, acting as the election agent for Mr. Strauss, the Unionist candidate. That, if true, would undoubtedly suggest that the Unionist candidate believed that the presence of a Socialist candidate would be to his political advantage for which he was willing to pay. The Social Democratic Federation has always been willing to accept help from any quarter so long as no conditions are attached and no restrictions placed upon our speeches, and actions, providing always that the help comes from a private and sympathetic source, but not from a political party, centrally or locally, with a view to using Socialist work, organisation and influence for its own particular ends. We have been, and are still, convinced that the help for the Socialist candidature in the Mining Division is from a private and sympathetic source, and we see no reason, until Mr. Cheux’s connection with that assistance is established, to alter our opinion.”

Mr. R. F. Cheux has sent a communication to the Press in which he refers to Mr. Lightwood’s story as “preposterous” and “manifestly absurd ” but makes no denial of the statements excepting the following :—

“At present I need do no more than refer the public to the categorical denials of the officers of the Social Democratic Federation which have appeared in the columns of to-day’s Press, and to state that at the time of the select ‘tea party’ which Mr. Lightwood says took place at his house, and at which I was alleged to be present, I was as a matter of fact in Cornwall ”

The name of Mr. A. E. Fletcher having been mentioned in connection with the matter, that gentleman made the following statement to a representative of Reynold’s Newspaper:—

“My position is this. I was asked by the secretary of the S.D.F. if I would go down to Camborne as the Labour candidate, as they considered I was the one man who was acceptable to the miners of this division. A friend of the Socialist movement, who wished his name not to be mentioned, was prepared to pay the whole of the cost if a Labour candidate, acceptable to the miners, was adopted. He also said that the present Liberal candidate was a member of the Rosebery faction, who had offered to retire if a Labour candidate were adopted. I said, if these conditions were carried out, I would go and address a meeting, and that I had no ambition to go into Parliament, but my ambition was to further the Socialist cause; but if I were accepted as a Labour candidate I would stand. But I was not aware that Mr. Dunn’s promise to retire if a suitable Labour candidate was found was made two years ago, and I went down to Camborne. They listened to me, but the meeting was packed with Mr. Dunn’s men. They heckled me, and asked if Mr. Dunn’s promise was to be considered perpetual. I replied no, it could not be forever; but he was a Jingo and a member of the Rosebery faction, supported the Boer War, and so on. But his chief supporter said, ‘If you had been first in the field we should have adopted you.’ Finding I had been misinformed as to Mr. Dunn’s promise, and not being satisfied where the money was coming from, I retired. I am convinced that Mr. Lee, the secretary of the S.D.F., believed that the money was coming from a sympathetic source, and had no idea that it was to be supplied by the Tory party. In fact, he told me it was not coming from any political source.”

Mr. Lightwood’s promised further revelations will be awaited with interest, and in the meantime let us ask :—

1. Why Mr. and Mrs. Lightwood should render themselves liable to a criminal prosecution for perjury if they have sworn to lies ?
2. Whether Mr. H. W. Lee’s statement can be believed in view of the fact that at the Annual Conference of the S.D.F. At Shoreditch in 1903, he admitted that he had lied to the delegates at the previous Conference, and declared his intention of doing so again if he considered it necessary in the interests of the S.D.F. Is the present an occasion when it is necessary to lie “in the interests of the S.D.F.”?

It will be noticed :—

1. That although the S.D.F. now declare that they knew Mr. Lightwood only “as a sympathiser with the Socialist movement,” Mr. H. W. Lee wrote him the remarkable letter which Mr. Lightwood received on Feb. 5th, 1904. If that incriminating document is a forgery why has not the S.D.F. instituted proceedings against the forger ?
2. That although these negotiations with the mysterious unnamed gentlemen took place in Jan. and Feb., 1904, the members of the S.D.F., assembled in Annual Conferences at Easter, 1904 and Easter 1905, were told nothing of the circumstances. If the Executive of the S.D.F. cannot trust their own members, how can the members trust the Executive ?
3. That although the S.D.F deny that they know Mr. Cheux, they do not give the names of either of the gentlemen who interviewed them, and who were admittedly acting only as agents;
4. That the S.D.F. declare their willingness to accept help from any quarter, so long as no conditions are attached. But here there were conditions, viz., that the money should be used, not as the S.D.F. Executive thought best, but in making a three-cornered contest in a particular constituency,
5. That, with the exception of the last paragraph, Mr. Cheux’s letter is an evasion. Mr. Lightwood has sworn that he holds letters from Mr. Cheux ;
6. That the S.D.F. misled Mr. A. E. Fletcher concerning Mr. Dunn’s promise; 
7. That although the S.D.F. were convinced that the money came from a sympathetic private source, they could not satisfy Mr. Fletcher, who visited the constituency, on that point;
8. That the S.D.F. statement, which appeared in Justice, was preceded by an intimation that “another statement will be at once sent out to the branches.” In what respect will this differ from the public statement ?

Blogger's Note:

What is funny about reading about all this is that the former Conservative MP for Camborne mentioned, Arthur Strauss, and the future Liberal MP for Camborne, Albert Dunn, who was also mentioned in the piece, both ended up members of the Labour Party. Strauss stood as an independent Labour candidate at the 1918 'Khaki' General Election in Paddington North and Dunn stood as an official Labour candidate in St Ives at the 1918 and 1923 General Elections.  

The Iron Horse (1960)

From the April 1960 issue of the Socialist Standard

Transport and the Growth of Industry (4)

The railways of Britain are continually under review and observation. It may be modernisation, the closing down of branch lines, poor time-keeping, dirty trains, high fares, or vile concoctions conjured up in the dining cars. In a few years we in this country will see the end of steam traction, a change already effected in other countries. No more shall we or our children be thrilled by the fierce glow from the fire box, with pungent swirling smoke as an express thunders through a station at night. Ours is no sentimental journey, however, but a short trip into the history of this form of transport, now an accepted part of our daily lives.

During the 18th century, production of coal and minerals as well as manufactures rapidly increased. Ships sailed away to distant lands and returned with new and precious materials; new areas were being opened to trade and settlement. The peasants, driven from the land by enclosures and poverty, swarmed into the industrial towns. A new type was appearing in Europe and North America; men who had engineering and technical skill, architects, scientists and chemists. The birth and growing-space of our capitalist world gave rise to a spate of bridge building, tunnels, docks and port installations, lighthouses and large public buildings. All of these works were necessary to the industrial revolution of commodity production.

One most noticeable feature of this age was the change in transport. Stage coaches ran to time tables and canals criss-crossed Europe and the North Eastern States of America. The industrialists were faced with problems of which the foremost was to keep up the supply of raw materials to feed and maintain the constantly improving machines. Another factor was that the act of buying and selling was ceasing to be the leisurely affair of the country market. People engaged in business had to move around and visit other lands, and competition demanded speed and time-keeping.

Coal had been conveyed in trucks on rails for centuries, since it had been found that horses and men could haul heavier loads if the wheels ran on tracks. These early rails were made of wood, and they wore out fairly quickly. To overcome this, iron plates were laid over the wood (hence the term, platelayers). Another method was to lay the plates in troughs or ruts, the wheels fitting into the depression. The problem here was that the rut often became full of earth and coal. In 1788 William Jessop invented a flat rail with a flange, the basis of our modem permanent way.

First Public Railway

The first public railway ran from the Thames at Wandsworth to Croydon (Surrey Iron Railway, 1803). The rails were the older rut type, as there were not many flanged wheeled vehicles at that time in London. In 1805 a horse hauled 38¾  tons, a distance of six miles in I hour 41 minutes, on this railway. That overworked horse certainly showed the value of railways to our profit and cash-conscious forebears.

Steam was the motive power in the new factories and it slowly killed the older water wheel. Steam powered factories could be built away from streams, right in the towns, provided coal and coke was available. Cornwall was enjoying a tin and copper boom and such names as Newcomen and James Watt took the stage in steam development. During the 1770/80s Watt and Boulton's great beam pump engines enabled miners to burrow deeper and overcome the ever-present problem of water in the shafts. There were many others in numerous countries that played their part in the development of “Steam Heat." A most important study was made of the practical application of metal compounds, so essential to enable boilers to withstand increased pressure of steam.

It was inevitable that some clever engineers would try to convert these stationery steam engines to a mobile form of power, to replace the horse and the sail. In America a steamboat ran for a short period, and in 1819 a ship using steam crossed the Atlantic, but the white wings of sail held their own for many years. In the Cornish mines a young man, “Captain Dick” Trevithick made a small working model, steam driven, which ran around his room. By 1801 he had made his first steam carriage, which ran along the lanes at Camborne. Man had made his first Iron Horse. These steam coaches later ran in conjunction with the stage coaches and, from the prints of the period, strange-looking cumbersome vehicles they were. Trevithick later tried his hand at building a steam locomotive for the Penydaren Iron Works in South Wales. Financed by Homfray, the Merthyr Ironmaster, the Cornishman built a one cylinder locomotive. On the trial day, February 21st, 1804, Trevithick wrote: “We carried 10 tons of iron, 5 wagons and 70 men.” Alas, the weighty machine was too much for the primitive tracks and the iron plates broke under the pounding.

Trevithick, with his versatile restlessness, moved on from one project to another; in London in 1808 he ran a train around a circular track at Torrington Square (prophetically near to where Euston Station was to be built in 1837). Steel, one of his co-workers, built another heavyweight failure for Wylam Colliery, Northumberland: not important in itself, but Steel was a friend of an obscure working man, George Stephenson. Between them the findings and failings of steam locomotives were discussed at great length. Others went on building failures —and improvements. Monsters were even conceived which, their inventors fondly thought, would prance along on legs like a cast-iron Arab charger.

One cannot discuss railways without acknowledging George Stephenson and his son Robert. The elder man was born in 1781 at Wylam in poor conditions; he worked on farms, but by the age of 14 was assistant fireman at Dewley Colliery, earning one shilling a day. By 1812 he was colliery engine wright on the pumps at Killingworth High Pit, repairing clocks and boots at night to supplement his poor wage. His son Robert went to school in Newcastle, and George, helped by the lad and a young friend, overcame his illiteracy and managed to study some works on engineering.

Stephenson, cut off from great wealthy architects like Telford and Rennie, had to spend his time discussing problems and theories on pay nights with his workmen friends. In those times there was an extreme shortage of mechanics, and engineers had great difficulty in getting their machines made in a reasonable time.

The man who brought Stephenson into the light was Nicholas Wood, a distinguished mining engineer. He noted Stephenson's keenness on machines and his interest in haulage and locomotive design. When Killingworth went in for steam traction to the coal docks on the Tyne, Stephenson secured the financial support of Lord Ravensworth, and built his first locomotive. From then on he and his son moved into prominence in the new world of railways, for not only were they engineers, but also had a broad mastery over architectural and surveying problems.

Stockton and Darlington

The best remembered work executed by the Stephensons was the 1825 Stockton and Darlington Railway which carried coal from the new pits near Bishop Auckland to the docks on the River Tees. Horse-drawn trucks were still the principal motive power on this line. The owners of the newly-built railways were still uncertain as to the value of the locomotives, and some leaned towards cable haulage. However, the Rainhill trials on the Liverpool and Manchester Railway in 1829 not only secured a victory for Stephenson with his Rocket, but showed that the technical infancy was past, and the Iron Horse had become a healthy adolescent.

The 1830/40s produced a crop of railway celebrities, such as Ericcson, Vignoles, Gooch and Locke. It was the Great Western, pushing out from Paddington to Bristol, that gave such a tremendous outlet for the versatile genius of Isambard Kingdom Brunel. The Hanwell viaduct in West London, built in 1837, remains untouched from Brunel's day, but the trains look down on a very different world, the world of  the internal combustion engine. Vast improvements in track laying took place, most noteworthy being the use of steel rails. Signalling evolved, as traffic increased, from the natural arm movement of the Railway Policeman, to the use of electricity and complex semaphores and coloured lights. In the 1840's the electric telegraph was being used lo a limited extent by the Great Western and Midland Railways. The foundation of modern control was laid by John Saxby's interlocking and block device in the 1850's.

Railways were a social product: Victorian capitalist society needed them, and railways needed this same capitalist expansion for their very existence and development. They were and are part of the arteries of our society. From Great Britain the technical knowledge soon spread over Europe and N. America, and the improvements in engines, rolling stock, tracks and signalling became universal, interchanging and adapting to suit requirements.

The early engineers had to face hostility from older entrenched groups. They also suffered from a lack of surveying instruments, and poor ordnance maps. The mass illiteracy of the times often delayed the use of improved signalling methods, a problem felt by all the early industrialists. The greatest evil has been the insatiable thirst for profit. Sound ideas have been modified or rejected in order to keep within a profitable margin or even solvency. As a result of this, hundreds of lives have been lost in dreadful accidents (although the casualties are small compared to our current road toll).

Towns were able to expand, as it was no longer necessary for employer or worker to live near the office or workshop. The steam train with its modern offspring—Underground Subway, Metro or Suburban, brings thousands each day into the centre of the cities, under tinned- sardine conditions.

George Stephenson once said: “The time is coming when it will be cheaper for a working man to travel on a railway than to walk on foot." We could hardly expect him to have looked forward to the day when transport would be regarded as necessary to the function of society, to be organised without the necessity for making a profit or hankering after subsidies. That will be the day when the men and women who work the railways will not have lo argue before tribunals for their livelihoods Railways, railwaymen—all the resources of society - will be devoted to the betterment of the whole of society.

Jack Law

Tin pot madness (1985)

From the December 1985 issue of the Socialist Standard

Defenders of the market system claim that the cost/price factors, through which it operates. enable modern production to be organised in a rational manner, that without the market modern production would break down and could not carry on in a practical way. Experience shows that it is precisely the operation of the market which constrains and dislocates modern production. It is only by first abolishing the market system that the useful structure of modern production could become free to be run in a practical way, directly for human needs.

This fact has been demonstrated yet again by chaos in the world tin market leading to a suspension of trading on the London Metal Exchange on October 24 and dislocation in the world distribution of tin. This was certainly not because the social need for tin was over-supplied. Obviously this metal is an important component of equipment and a wide range of finished goods which are needed throughout the world. But needs are not a "rational" concern which determines the operation of the tin market. In fact, the trading crisis centred on a very different question. Far from the market being a practical mechanism allowing for the distribution of tin, trading on the London Metal Exchange broke down because profit-making was thrown into chaos.

Central to the crisis was the work of the International Tin Council, which is fraudulently described as a “producers' and consumers' group". None of the actual producers of tin the miners of Malaysia, Indonesia, Thailand, Brazil, Bolivia, Australia and, among others, 2,000 tin miners in Cornwall - have got anything to do with the Council. Nor have the consumers of tin the wider community, for whose consumer needs tin should be directly produced.

The International Tin Council represents a very different set of interests. These are the owners and traders of tin who buy and sell this commodity with the sole object of profiting from it. It is a world price pact agency whose aim has been to maintain the price of tin on the world market. It has been financed by various governments and from loans, with a view to intervening in world trading with the object of regulating the world price above the recent floor price of £8,500 a tonne.

In trading conditions of over-supply in relation to market capacity, with a corresponding tendency of the price to fall below the floor price, the International Tin Council intervenes as a buyer with a view to increasing the price. It then controls reserve stocks which, theoretically, it is able to market when the price is restored. In addition to this, and by agreement, the Council is able to set export quotas aimed at cutting back on production as an added means of relieving downward pressure on the world price. For example, against the needs of people, production from Indonesia declined from 33,322 tonnes in 1981 to 22.500 tonnes in 1984.

During the early period of the 29 years of the price pact, regulation of the world price was never easy, even when four national capitalist groups - Malaysia, Indonesia. Thailand and Bolivia between them controlled 80 per cent of the world's supply. Also during this early period, sales at a profit were buoyant. But since that time world capitalism has entered the current depression and together with this other large scale sellers of tin, such as Brazil, have entered the world market outside the price pact. As a result, control of world marketing by the International Tin Council has fallen to 60 per cent of current production. This has brought pressure on the members of the price pact to cheat. So there has been a growth of smuggled tin and the movement of illegal tin. Far from the operation of this market being "rational'' - or. as its defenders believe. “the most practical system" the convolutions of its insanities have now resulted in something known as "illegal tin".

Substantially, the dealings on the London Metal Exchange involve the buying and selling of exchange contracts which do not necessarily result in the transfer of the ownership of the metal itself. The absurdities of this marketing saga were highlighted early this year when the stock manager of the International Tin Council insisted that, instead of the mere buying and selling of exchange contracts, which involved selling forward one day and then buying back cheaper the next, the actual tin involved should be physically delivered in line with the sales. This caused even more chaos in the market and so had to be abandoned.

The temptations for the capitalist controlling the supply to go on marketing tin, with the International Tin Council buying to keep the world price above £8,500 a tonne, have proved impossible to resist. In October the stock manager of the Council controlled reserves of 62,000 tonnes, enough to supply current world capitalist use for 5 months. Against an accumulation of 62,000 tonnes which the Council did not know what to do with, bankruptcy of their own funds, debts estimated at £340 million on outside loans with bankers in panic, trading was suspended.

It is important to note that behind this marketing chaos there is in fact a useful structure of world tin production which could be operated directly for human needs. The raw material is mined in various world locations by workers who have all the necessary skills. This raw material is transported to regional centres of industry where it is processed and refined into tin. It might then be processed with other metals as various alloys. These materials are then transported to centres of manufacture where they are prepared as the component parts of machinery, equipment or finished items of consumption goods. With further assembly the finished goods are distributed to the various localities.

This connected network of productive activities through which tin ore becomes finished goods depends on the skills and energies of the workers involved. The network operates as a result of required quantities of the worked-on materials and component parts being communicated throughout the various stages of production and distribution. As this useful structure of production already exists, the future society of socialism would not require an entirely new or different one. What is required is the removal of the present capitalist features which are now imposed on this useful structure. so that its useful features would be free to operate through co-operation directly for human needs.

Thus in socialism, with a system of production solely for use, needs would arise expressed as definite quantities of required goods among the whole community. These would be registered and communicated to regional centres of manufacture. As a result, regional manufacturing units would know the amounts of required production. This would be passed on throughout the entire network of production eventually to the mining and processing of such raw materials as tin. This would be a direct and practical response of social productive activity based on co-operation in line with social needs. But it can only be free to take place once the market system is abolished, which requires that the entire means of production and distribution must be converted into common ownership by the whole community.

Under capitalism the structure of tin production, based on the world mining of the raw material, regional processing and manufacture and assembly of finished products then local distribution, is inevitably loaded with waste. Competing enterprises repeat means of production and the constraints of the market result in these not being used to full capacity. At present the Tin Council alone retains a stockpile of 62,000 tonnes which has no immediate profitable use. Goods manufactured in Japan are sent to America and Europe and vice versa. This anarchic system of distribution results in the same articles criss-crossing each other on the world's trade routes. Moreover, tin production has been reduced as a result of the present depression. Tin miners have become unemployed.

Without the market, this useful structure of production could be operated more productively in direct line with human needs. This could avoid all the present wasteful features. Whereas "oversupply" of the material in relation to the capacity of the market for sales at a profit involves a denial of human needs, in socialism the position of oversupply would not be reached until human needs had been met.

It might well be asked - could the work of the present International Tin Council be adapted for use in socialism? Obviously its present function in the world market would be immediately redundant. Nevertheless, some of its useful features could be taken up. For example, it provides useful information on world tin production, its many uses and the world distribution and availability of the raw material reserves. Perhaps such an organisation could have a useful monitoring role in socialism, providing information which might help with decisions about the use of this material against others for different purposes.

What is certain is that behind the madness of the market, there is a useful structure of production and administrative machinery, which could provide ready-made organisation for the operation of production solely for use.

Pieter Lawrence