Russia: Land of High Profits. (1930)

Book Review from the September 1930 issue of the Socialist Standard

“The Soviet Union Year-Book, 1930.” Publishers: George Allen & Unwin, Ltd. 7s. 6d.

The Soviet Union Year-Book, compiled and edited by A. A. Santalov and Louis Segal, Ph.D., M.A., is published “to provide business and public men with a reliable information on the economic and political life of the U.S.S.R.” It contains in its 670 pages accurate and detailed information from official sources on all the chief aspects of Russian economic and political life. For business men seeking trade connections, and for those who wish to combat the double campaign of misrepresentation which is carried on by the ignorant and prejudiced in the ranks of capitalist parties on the one hand and the ranks of the communist party on the other it is an indispensable work of reference.

It is not possible here to describe fully the range which is covered. It must suffice to indicate some of the facts and figures which will be useful to the Socialist student of Soviet affairs.

Production and foreign trade.

Much space is devoted to the growth of trade and production. Agricultural production in 1928-29 was 4 per cent. above that in 1913, and in 1932-33 it is planned to reach 59 per cent. above the 1913 level (page 92). Industrial production in 1928-29 was 73 per cent. above 1913 level, and in 1931-32 will reach 166 per cent. above that level (page 94).

Exports in 1928-29 were valued at 877 million roubles, as compared with 1,520 million in 1913. Imports in 1928-29 were valued at 836 million roubles, as compared with 1,374 million in 1913 (page 289). It is planned to increase exports to over 2,000 million roubles in 1932-33, and imports to over 1,705 million. In 1909-13 agricultural exports represented 70 per cent. of the total exports, and industrial exports 30 per cent. In 1932-33 the proportions will be equal, if the plan matures (page 291).

High Rates of interest and profit.

The Concession Companies make staggering profits out of the exploitation of the Russian workers. In 1926-27 the average profit was 81 per cent. on the capital invested by them.

In 1927-28 it was 96 per cent. (see page 208). What a harsh reality after the dreams of the visionaries for whom Russia was to serve as a model to the Western world. One of the Bolshevik slogans of 1917 was “Down with the foreign bondholders.” They were duly “downed” and the National Debts repudiated. The Soviet Government has just repeated its willingness to resume part of the old National Debt obligations, but in the meantime the foreign bondholders have given place to “home” bondholders – a distinction without a difference from the stand point of the Russian workers.

A rapidly increasing percentage of the total revenue of the Government is raised by means of additions to the new National Debt. In 1927-28 the percentage was 0.5; in 1928-29 it was 8.6 per cent., and in 1929-30 it will be 11.5 per cent. (page 397).

On October 1st, 1925, the new National Debt stood at 367 million roubles (£36 million). On October 1st, 1929, it was 2,595 million roubles (£259 million) (see page 398). It is at the present moment nearly 3,000 million (£300 million), and it is planned to increase it to £500 or £600 million in the next year or two.

The amount raised by means of loans during the one year 1929-30 reached the total of 1,335 million roubles (page 391). In the same year the Government spent 450 million roubles on payments to the new investing class who have invested their money in Russian industry through the Russian Central Government. Interest rates are very high; up to 12 per cent.

Other avenues of investment for Russia’s propertied class are the co-operatives. Hundreds of millions of roubles are invested in that way (see pages 226 and 621).

All these forms of investment, in the National Debt, in the co-operatives, and in the trading concerns, etc., are forms of exploitation of the Russian workers They, like the workers everywhere, carry on their backs a class of property owners, receiving incomes from property ownership.

The very high rate of interest which rules in Russia owing to slowness with which foreign investors enter the Russian money markets, may serve to explain why the Russian Government, or certain influential groups behind it, continues without any tangible result to finance Communist parties abroad. Investors inside Russia would naturally not want the interest rates to fall from 10 per cent. or 12 per cent. to 4 per cent. or 5 per cent., and an obvious method of preventing this would be to play upon the fears of foreign Governments and investors, and thus save themselves from unwelcome competitors.

Excess profits tax.

As in this country, the income tax in Russia is a graduated one, there being five categories. In each of them provision is made for different rates of tax on ranges of income from under 1,000 roubles a year up to 24,000 roubles and over (page 402).

The fifth grade applies to those whose incomes are derived from “ownership of industrial and trading enterprises, from money investments, dividends on shares, etc.” (page 402), also incomes from “rent” (page 401).

Then, in addition to the income tax, there is an excess profits tax for those companies whose yearly profits exceed a standard which is described as the “normal profits” (page 405).

It is this economic organisation, possessing all the usual features of exploitation (rent, interest, and profit, a working class, and a property owning class, a stock exchange, etc.), which the Communist parties describe as “Socialism”!

Wages and unemployment. 

The average money wages in 1928-29 was 892 roubles (£89, or about 34s. 6d. a week(page 453).

The worker’s output is increasing at a greater rate than his wages. Under the five-year plan the “productivity of labour in the end of the five-year period will be doubled and real wages are to show an increase of 70 per cent.” (p. 97)

(Information about the inequalities of wages and salaries was given on The Socialist Standard for December, 1929)

The number of unemployed in 1924-25 was 848,000; in 1926-27, 1,353,000; and on January 1st 1930, 1,310,000 (page 454).

The amount paid out in unemployment insurance in 1928-29 was 111,500,000 roubles. This works at about 80 to 90 roubles a year for each unemployed person (on the basis of 1,300,000 unemployed). This, in English coinage, is about £8 10s. a year, or 3s. 3d. a week. The trade unions also pay unemployment benefit to their members from 3 to 18 roubles a month, say from 1s. 6d. to 9s. a week. Although the unemployed are exempt from the obligation to pay rent, or charges for lighting, water and transport, it would seem that they do not have a very pleasant time. Is this what our communists have in mind when they ask the Government here to give the unemployed “full maintenance”?

Inheritance.

As in other capitalist countries inheritance of property is recognised in Russia. “Soviet law recognises the right of inheritance, irrespective of the amount involved” (page 498).

As in this country, it is subject to an inheritance tax (page 405). The tax rises from 5 per cent. on the first 2,000 roubles (£200) up to 90 per cent. on that part between 200,000 and 500,000 roubles (£20,000 to £50,000).

The Communist Party. 

The membership of the Communist Party on July 1st, 1922, was 1,554,012 which represented 184 in every 10,000 of the adult population, or 1 in 54 (page 565).

The number of new members enrolled in 5½ years from 1924 to June, 1929, was 1,408,742. The number expelled in the same period were 128,460.

On July 1st, 1929, the party was composed as follows: – workers, 724,115; peasants, 200,452; employees, etc., 629,327. Women form 13.5 per cent. of the whole membership (page 566).

Education.

In December, 1926 (the last available figures) illiterates had been reduced considerably, but still represented 433 per 1,000 of the whole population (page 462)

The expenditure on education by the Central Government is under 3 per cent. of its total expenditure (page 462).

It is less than the amount spent on army and navy (page 389).

Hopes and facts.

In the first section of the “Constitution of the U.S.S.R.,” passed in 1923, Russia is depicted in the following rosy terms: –

“Here – in the camp of Socialism –are mutual confidence and peace, national freedom and equality, and dwelling together in peace and brotherly collaboration of peoples” (see page 1).

The facts given in this Year-Book sufficiently illustrates how illusory the communist dreams have been. Like many pious hopes embodied in the official documents and constitutions of the rest of the capitalist world these phrases have no relation whatever to the actual facts. Russian capitalism, although administered by the Communist Party dictatorship, reproduces almost down to the last detail the paraphernalia of the capitalist world as we know it here.

The lesson of it is the one we have tried to drive home for so many years, that it is not possible for a minority to impose socialism upon a majority who are hostile or indifferent; nor is it possible to remedy backward economic development by means of fine-sounding but ineffective decrees, issued by dictators.

Edgar Hardcastle

The Great Lie. (1930)

Book Review from the September 1930 issue of the Socialist Standard

Falsehood in War-time, Containing an Assortment of Lies Circulated Throughout the Nations During the Great War by Arthur Ponsonby (Allen & Unwin.)

We still speak familiarly of the War, as though it were something that only occurred the other day. It is curious to reflect that our boys of sixteen were babies in arms, and our young men now coming of age were toddling infants when red ruin was let loose on an unsuspecting world. Each year it is customary on the anniversary of the catastrophe, for the tawdry minds of Fleet Street to reassure a doubtful world that the slaughter was not in vain. Its hideous futility and long-drawn-out horror, are concealed in flatulent phrases about our National Honour, our concern for International Rights, the Sacredness of our Pledged Word, our Regard for the Rights of Small Nations, and other eyewash. Should there be any who still allow these illusions to drift about their consciousness, they might do much worse than spend half-a-crown on Mr. Ponsonby’s “Falsehood in Wartime.” August 4th this year again fell on Bank Holiday, exactly as it did sixteen years ago, and it seemed fitting to celebrate the anniversary by reading how our Christian rulers lied the people into massacre, lied them through it, and lied them back to peace and unemployment again. As Mr. Ponsonby says : “There must have been more deliberate lying in the world from 1914 to 1918 than in any other period of the world’s history.”

Those who were too young for the shambles last time, would do well to examine the bait that caught their fathers and their elder brothers. The collection is not exhaustive. It is only an exposure of a few samples, and is intended as a warning. The nation was assured that it was not committed to France in any way. It was a lie. “All preparations, down to the last detail, had been made, as shown by the prompt, secret and well-organised despatch of the Expeditionary Force.” The German invasion of Belgium was given as the cause of Great Britain’s entry into the war. It was a lie. Mr. Ponsonby gives the evidence. Germany, of course, we know was solely responsible for the war ! Mr. Asquith said so : “One Power, and one Power only, and that Power is Germany.” Lloyd George referred to it as the “most dangerous conspiracy ever plotted against the liberty of nations. …” (August 4th, 1917.) Three years later the Welsh Wizard realized “that no one at the head of affairs quite meant war at that stage (August 1st, 1914) . . , and a discussion, I have no doubt, would have averted it.” Four years of the bloodiest horror the human race has experienced, “and a discussion, I have no doubt, would have averted it.” What a thought for Bank Holiday. If the twenty million dead could only read that.

And then there was the notorious lie of the passage of hordes of Russian troops through Great Britain, en route for France. In less than a month the atrocity stories commenced. There was the nurse whose breast had been mutilated, the Belgian baby whose hands had been hacked off, the Canadian who was crucified, the tale of the prisoner whose tongue had been torn out, the tattooed man, and so on. All lies, utter downright lies. Everyone remembers the German corpse factory yarn. Who believes it now? And so we go on. Lists of atrocities that never happened, photographs that were faked, official documents that were doctored ; lies by the cubic ton, lies by the square mile, lies by the great gross, and all to secure the killing of men and the starving of women and children. The British established a truth manipulating factory at Crewe House, under the appropriate leadership of Lord Northcliffe, founder of the “Daily Mail.” He’d had some experience.

Mr. Ponsonby is candid. He says in his introduction : “This is no plea that lies should not be used in war-time, but a demonstration of how lies must be used in war-time. If the truth were told from the outset, there would be no reason, and no will to war.”

He calls attention to the new and far more efficient instrument of propaganda which has appeared since the last war—the Government control of broadcasting. He concludes : “None of the heroes prepared for suffering and sacrifice, none of the common herd ready for service and obedience, will be inclined to listen to the call of their country once they discover the polluted sources from whence that call proceeds and recognise the monstrous finger of falsehood which beckons them to the battlefield.”

We agree. We were saying that ten years before the war. It is important to realise, however, that the pollution is not confined to war-time.

W. T. Hopley

Notes by the Way: Are the Labour voters Socialists? (1930)

The Notes by the Way Column from the September 1930 issue of the Socialist Standard

Are the Labour voters Socialists? 

Dr. A. Salter, Labour M.P., stated in an article in the Daily Herald (May 2nd), that not 10 per cent. of the electors are Socialist. He said :—

“Labour candidates polled only 36 per cent. of the total votes at the last election, and of that 36 per cent. how many were those of convinced Socialists? I wish I could believe that 10 per cent. of the people of this country desire the establishment of a Socialist Commonwealth !”

Dr. Salter correctly concludes that in face of this the Government has no mandate to introduce Socialism. But in that case, why are they in office, and why is Dr. Salter in Parliament?

* * *

A Labour paradise.

Bermondsey has long had a Labour majority on the Council. The uselessenss of the Labour Party’s policy of reforming capitalism is well illustrated by the following facts about Bermondsey, submitted in evidence to the Licensing Commission by Dr. Salter, M.P. :—

“One in seven of its residents is in receipt of Poor Law Relief. The population is homogeneous in the sense that there are no social strata as in most townships. The middle classes have long since removed from the district, and, owing to obvious residential disadvantages, a steady efflux has been going on for years of all those who could afford to remove to a more open and more desirable neightbourhood. Clerks and artizans have gone, and to-day the people left are almost wholly belonging to the unskilled and casual waterside labour classes. The middle class element is represented only by a small handful of clergy and doctors. There is no resident solicitor or barrister, no civil engineer, architect, or accountant. Most of the non-conformist ministers live outside the borough, and there is no cab-rank or bookshop.”

“Wages are very low, and the average figure for regularly employed adult male workers is well under £3 a week. At the end of 1928 and beginning of 1929 I made an investigation into the wages of 860 successive male panel patients, seen by me with regard to wage rates. I found that the average wage of those in regular employment amounted to £2 16s. 4d. per week.”

“Parts of the borough are very densely covered with a network of small, closely-packed streets and alleyways, while in other districts there are acres of high block dwellings of five or six stories, where the density of the population amounts to between 400 and 500 per acre.”

* * *

Railwaymen's leaders win a "victory" in the Irish Free State.

The officials of the National Union of Railwaymen have won a great “victory,” having obtained recognition from the Irish Omnibus Co. As is usual in such cases what the members have gained is not obvious.

The Great Southern Railway recently bought out the road transport companies which were robbing them of their best paying traffic. They promptly celebrated that move by attacking the wages and conditions of the workers in their road transport concern, the Irish Omnibus Company. The men struck work in April and succeeded eventually in getting the railwaymen to come to their assistance.

The N.U.R. officials had resisted a strike movement among their Irish Free State railway members, but were compelled to recognise the railway strike after it had begun. They then threatened a general strike for Tuesday, July 22nd.

A meeting took place—in secret—between the two companies and the N.U.R. leaders. It was followed by Mr. Cramp’s announcement of a great victory. The terms were that the railway strike was called off, all railway strikers were reinstated, and the N.U.R. was granted official recognition by the Irish Omnibus Co. No guarantee was given for the immediate or ultimate re-instatement of all the ‘bus company strikers, and nothing is said about the wage and other questions which led to the ‘bus strike in the first instance.

As we have often pointed out, the only saieguard against this kind of thing is that the workers on strike should keep the negotiations under their own control, and not entrust them to leaders to conduct in secret with power to accept whatever terms they think fit.

It need hardly be added that the Irish Free State Government, the Government for which misguided Irish workers fought helped the employers just as the British Government used to do before the Irish Free State became “free.”

* * *

St. Thomas the Martyr!

What the Labour Government has done for the Unemployed

Mr. J. H. Thomas, addressing the Conference of the National Union of Railwaymen, in July, 1929, said :

“I have been entrusted with the responsibility of seeing how far within the limits of our Parliamentary traditions and our resources of the State—and accepting the present order of society—how far it is possible to mobilise, organise, institute, and get going useful works for those now unemployed.” (“Daily Herald,” 6th July.— Italics ours.)

Three months later Mr. Thomas had done nothing, but had gained more confidence. In a speech at the Labour Party Conference at Brighton, on Tuesday, October 1st, he told the delegates :—

“I am confident that when February comes our figures will be better than the figures of the late Government.” (“Daily Herald,” 2nd October.)

When February came the figures had gone not down but up—by hundreds of thousands, which drew from his defender, Mr. John S. Clarke, M.P. (who used to worship De Leon, then Lenin, then MacDonald), the explanation that Thomas really knew all the time that unemployment would not fall, he knew that the

“world depression . . . was bound to increase before it showed signs of lifting ; that there was and is no permanent cure for unemployment under a system of private control.” (“Forward,” 31st May, 1930.)

Mr. Thomas, it appears, was really a noble fellow, “suffering a distressing martyrdom without complaint,” and lying for the sake of you and me. Anyway, Mr. Thomas’ luck was out, and in due course he transferred his £5,000 a year martyrdom to another Cabinet ministership. Now the number of unemployed on the register is over 2,000,000, which is the highest figure since the national coal strike in 1921, and represents an increase of 900,000 during the period of the office of the Labour Government.

* * *

Dean Inge studies Socialism.

Not long ago, Dean Inge was presented with a copy of out pamphlet, “Socialism and Religion.” We see that he has been profiting by it. In the course of a lecture at the Wesleyan Methodist Conference at Leeds on July 18th, he spoke about Socialism and Religion and put very plainly the fundamental antagonism between them. He rejected the possibility of Christ having been a Socialist, and the claim that Socialism is based upon New Testament teaching. Speaking of Christ, he said :— (Manchester Guardian, July 19th).

“It is hardly necessary to say that even if He had wished to lay clown a scheme of Socialism, and such an idea never occurred to Him, the conditions of Palestine under Pontius Pilate and Herod would have put it out of the question. His travelling missionaries were to live on alms like begging friars, but this proves nothing. His own little band seems to have carried a bag with money in it, and to have bought food when they needed it. Christ was a prophet, not a legislator.

Some people reject Christianity because they do not understand it; others because they do understand it. To the latter class unquestionably belong the disciples of Karl Marx, for what excites their passionate hatred of Christianity is precisely that idealistic standard of values which cuts the ground from under the feet of their savage and vindictive materialism. If Christ is right, Marx is utterly wrong.”

Except that materialists are almost always less savage and vindictive than idealists, this is just what we point out in our pamphlet. We are, however, startled by Dean Inge’s association of Rousseau and Marx, and by his statement that had there been no Rousseau there would perhaps have been no Marx and no Socialist doctrine.

Dean Inge goes on to repeat a statement he has often made, and which, in spite of being challenged, he does not attempt to prove. That is his assertion that communist-administered capitalism in Russia is the result of applying Marxian theories. It is one of the privileges of being a Dean that statements which are sound sense and statements which are clotted nonsense are alike accepted without question by nine people out of ten. This is bad for the nine people, and has a most demoralising effect on Deans.

P. R.

Letter: The case for Spiritualism. (1930)

Letter to the Editors from the September 1930 issue of the Socialist Standard

Battersea, S.W.11.

To the Editor.

Dear Sir,

Being interested in political economy and a reader of long standing of the S.S., I am tempted to ascertain your views of the following :—

For many years past I have held no brief for any religion, but having heard a lot about spiritualism and also read your criticism on same, decided to test it myself.

I told nobody where I was going, and I went into a meeting a perfect stranger to all. To my surprise I was told of my dead aunt, her manners when alive, how she died, her age, and her name ; after which I was told I was suffering from a complaint which I had attended hospital for. The said complaint is very uncommon, and is not visible to anyone except when nude.

Sir, the above is only one of many experiences I have witnessed during my visits to these said places ; therefore I consider it calls for an explanation to many who, like myself, desire to know and seek the truth.

I must say that not one word or hint was given by me, in any manner at all to assist these people.

Sir, realizing the value of space in the S.S. relating to things of political importance, and, therefore, placing my inquiry second, I should like to have a reply through any channel you may desire.

I am, One in the struggle,

CURIOUS.

Reply:

Our correspondent’s experience and the conclusions he draws from it are common ones among those who have been attracted to Spiritualism. In order to test it let us put the problem in its simplest form.

This reader went to a spiritualist meeting and was told several things about himself which he and others already knew.

That in itself he would not regard as startling except for his belief that he was “a perfect stranger” to those present, and that the things he was told were not known to them.

Now may we ask our correspondent if he really has good ground to believe that nobody present knew anything whatever about him. We, of course, know no more than is told in the letter, but it will be readily agreed that it is by no means difficult for people whom we do not know by sight to have or to get information which in such circumstances may sound impressive.

The ability of certain persons to get hold of facts about him does not in any way whatever help to establish the belief in the existence of so-called “spirit forces.”

Editorial Committee.

Letter: Economic Questions. (1930)

Letter to the Editors from the September 1930 issue of the Socialist Standard

To the Editor of the Socialist Standard.

Is it, or is it not, correct to hold that Marx used the term “Capital” in the sense of “Money,” seeing that all commodities are only “Money” circulating in a different way?

That the “Price of Production” (of commodities) is not “determined” by the “quantity of labour embodied in them,” but is ultimately “determined” by monopoly“?

An adherent of the. S.P.G.B. informed me that a lecturer on economics at headquarters seriously discussed the question as to whether a “cart-horse” is “constant” or “variable” capital. If this is a fact (?) then I feel bound to remark that the lecturer must be considered a “doctrinaire,” and in no way propagating “Socialism in Our Time.”

I trust you will favour me with a reply, because it is important to clear up such current conceptions—or “misconceptions.”

I remain, Yours faithfully,

Robert Chapman,

Walworth.

Reply:

The replies to the points raised are given below.

(1) This matter is dealt with in “Capital,” Volume I, page 123 (Sonnenschein Edition), in the following’ passage :—

“As a matter of history, capital as opposed to landed property, invariably takes the form at first of money; it appears as moneyed wealth, as the capital of the merchant and of the usurer. But we have no need to refer to the origin of capital in order to discover that the first form of appearance of capital is money. We can see it daily under our very eyes. All new capital, to commence with, comes on the stage, that is, on the market, whether of commodities, labour, or money, even in our days, in the shape of money that by a definite process has to be transformed into capital.”

(2) The “Price of Production” is the cost price plus the average profit. This is, of course, affected if the manufacturer has to buy raw materials from sellers who have a monopoly, and on the other hand the manufacturer’s selling price will be affected if he has a monopoly. In other words, the theory of value in its simple form assumes competition. Monopoly (which in practice is, however, only an interference with competition, not a complete suspension of it) modifies the simple theory. Nevertheless, the labour theory of value is still the underlying explanation, even in a world where monopoly is strong.

It must not be forgotten that there are many forces at work tending to undermine monopoly. This subject is dealt with in “Capital,” Volume III, pages 186, 209 and 1003 (Kerr Edition).

(3) Your point here appears to be that a lecturer should keep to main issues, and not devote attention to minor academic points. Once granted, however, that it is worth while studying economics, the lecturer cannot avoid dealing with such points if raised by a student. To the student a clear view of such points may often be necessary in order that he may understand the general theory.

Editorial Committee.

Answer to correspondent. 

S. Gilbert. Your long letter referring to the article “Parliament or Soviet” rests upon a supposed quotation from the “Gotha Programme.” As, however, the article contains no such quotation, we fail to see what is the point of your letter.

Letter: The Pay of Civil Servants. (1930)

Letter to the Editors from the September 1930 issue of the Socialist Standard

A letter from a reader.

Forest Gate.

Dear Sir,

As a regular reader of the Socialist Standard I should like to take exception to the article appearing a month or two ago on “Nationalisation,” in which the low wages of various Governmental employees were quoted.

As a Socialist, I am aware of the defects of Nationalisation, but would like to point out that though some employees of the Government do very badly, some do very well.

Under the term Government I include the Local Councils of Boroughs, etc.

In the first instance we have policemen receiving, after 10 years’ service, £4 10s. wages, plus 15/6 rent aid, for a constable ; sergeants, inspectors, etc., get more; much more in the cases of the higher ranks.

Firemen, I believe, receive the same wages, less the rent aid, as it is termed.

Teachers in the Elementary Schools appear to do very well when compared with industrial workers.

Lady Teachers commence, I believe, with £3 per week, and get somewhere about £5 a week after a few years, as one instance.

School Attendance Officers as the school board man of our school days is known, start at about £4 16s., and rise to £5 5s.

Also we have Local Government Board Officers as the clerks employed by Municipal Councils term themselves, with others such as sanitary inspectors, etc., receiving in many cases anything from £4 10s. to £7 or £8 per week, coupled with three or four weeks’ holiday.

Most of the above have no more training than a skilled mechanic is required to have, and in many cases they have considerably less, but compare the wages and conditions and they are vastly different, as you already know.

I hope I am not taking up too much of your valuable space, but I am afraid I could not state my case in less words. 

In conclusion, I wish the S.P.G.B. and the Standard the best of luck in the future, and hope you will receive this letter in the spirit of helpful criticism that is intended by myself, as full facts are and must continue to be the essential feature of the S.S.

Best wishes from

“SOCIALIST.”

Reply:

Our correspondent misses the point of the article he criticises. The contention made in that article was that there is “little difference from the workers’ point of view, between State capitalism and private capitalism, whether under a Conservative or a Labour Government.”

To say, as our correspondent does, that an elementary teacher is paid more than an industrial worker, has nothing whatever to do with the question discussed. He must compare like with like; for example, compare the pay of industrial workers in the Government service with the pay of industrial workers outside. If he does he will find that our contention is correct.

But the whole question is easily settled by the statements of Civil Service authorities themselves. The Civil Service Industrial Court which fixes the pay of civil servants has laid it down when dealing with lower grade civil servants that

“the broad principle which should be followed in determining the rates of wages of Post Office servants, is that of the maintenance of a fair relativity as between their wages and those in outside industries as a whole.”

The Industrial Court takes into account the civil servant pension rights and any other benefits he may receive, and fixes his cash wage accordingly.

But whereas the Civil Service bases the pay of lower grades on the rates of pay in comparable occupations outside, the higher grades in the Civil Service are definitely paid less than the rates of pay in comparable occupations outside. This has long been a complaint of the grades concerned. In evidence given at the Royal Commission on the Civil Service (now sitting), Sir Evelyn Murray, Secretary of the Post Office, was asked if the Post Office pay as much in their higher grades as is paid outside, and replied :—

“I do not think that is a principle that the Government have ever accepted as regards the higher grades of the service.” (See Minutes of Evidence. Question 4618.)

—Editorial Committee

Points for Propagandists. (1930)

From the September 1930 issue of the Socialist Standard

Over-production and want.

The followers of Malthus and the Secularists who still talk of over-population are completely refuted by the universal facts of modern industry. The command of man over nature in producing a food supply has increased so rapidly that there is a widespread demand to limit production.

Agriculture lagged behind industry so long in increased production that whilst industrial products declined in price, the products of agriculture tended to rise. The application of machinery to farming and the adoption of large scale methods on the land has now reached such a pitch and so lowered prices that the agriculturist is crying out. Prominent owners express their joy that the crop in South America is poor this year. Such is the pass to which production for sale and profit has brought us.

The Sunday Express (June 29th) tells us that 2 million acres of wheat and maize land will go out of cultivation next season and that Brazilians are burning coffee because they cannot sell. The meat combines of S. America have been practising restriction of production, we are told by the same paper. They also inform us that in spite of “real efforts” to restrict the production of petroleum in U.S.A. it increased there by 14 million metric tons. The total world increase this year, compared to last, is 23 million metric tons. The Shell Oil Co., however, is not in bankruptcy, but was able to report a profit balance of 6 million pounds and pay 25% dividend this year.

Economic development proceeds alongside the efforts to limit production, as the recent advances in the oil refineries show. The News of the World (June 29th) reports that a new process for doubling the yield of motor spirit from crude oil by the use of hydrogen is being developed. The German Chemical Trust and the Standard Oil Co., and the Royal Dutch Co. jointly control the process, in order to control output and extract all possible profits by gently but firmly killing that noble spirit of competition which used to be praised as “the life of trade.”

The increase of productive power along with the vast increase of wealth which cannot find a market has led the author of “The Case for Capitalism”—Mr. Hartley Withers, to make the following confession :

“This spectacle of universal plenty along with universal distress, is very far from creditable to the alleged enlightenment and civilisation which we are now supposed to enjoy. People who have worked for us have worked so well that they cannot make a living, and yet we are none of us getting nearly as much benefit as we should out of the consequent cheapness of things (“Sunday Dispatch,” 6th June).

Let society own the tools and produce for use !

* * *

Is Socialism a religion? 

“There is a conventional assumption that Socialism is opposed to religion. The assumption comes from orthodox camps on both sides. With all the being born of 40 years of active Socialist life I would like to shake it as a terrier proverbially shakes a rat.”

The angry author of these words is Mrs. Bruce Glasier, in the I.L.P. paper, the New Leader (June 13th). She shows the “harmony” between Socialism and Religion by robbing Religion of its accepted meaning, and defining it as “the spirit of the whole.” Karl Marx and Lenin are both religious types, according to her.

She does not attempt to show that Socialism is in accord with religion, as commonly and correctly understood. She leaves completely alone the conflict between the materialist basis of Socialism and the superstitions and supernatural character of religion. The community spirit is common alike to religion and Socialism, Mrs. Glasier informs us.

Socialism, however, is the object of a militant movement recognising the class struggle in modern society. The Socialist realises also that religion as we know it, is an instrument of the ruling class to divert attention from the real world and the real work to be done.

This I.L.P. pioneer has a conception of religion as confused as her idea of Socialism—”the economics of the Lord’s Prayer.” Why not the Sociology of Baptism ?

* * *

Children's Allowances and the I.L.P.

The I.L.P. state on the front page of the New Leader (June 27th) that employers will not be able to deduct children’s allowances from wages, as they will be paid like pensions through the Post Office. Such childish simplicity and evasion may suit these reformers. It is not necessary for the employers to inquire if their workers are getting children’s allowances, but the general receipt of such payments will act as a basis for compiling the average family cost of living. In a fiercely competitive labour market there will be little difficulty in employers making the workers accept the revised wages. Lord MacMillan, in making his report on woollen wage reductions, pointed out that social services such as pensions, insurance, etc., should be taken into consideration in fixing present-day-wages. It has been a regular policy for years to engage pensioned men who can live on less wages.

Children’s allowance experience in Australia give the lie to the I.L.P.

In another issue (July 11th) the New Leader tells us that during strikes the children’s allowances will assist the workers to win, as the children will no longer go hungry on account of the strike. Such is simple faith. During recent strikes it has been noted how difficult it has been for the strikers to get poor law relief for the children. During the General Strike (1926) the Press stated that plans were being made to attack the bank accounts of the Trade Unions to prevent strike pay being issued. And if children’s allowances were passed by a capitalist government they would control its administration and these allowances could be suspended when it suited the governing body if the interests of the employers were at stake.

It is not surprising that such a body of misleaders as the I.L.P. should have their discussions of party policy in private as they announce to take place at their Summer School at Welwyn (New Leader, July 11th). More secret diplomacy !

* * *

How government ownership works.

The One Big Union of Canada has sent a representative to the Privy Council here to appeal against the decision of the Government-owned railway of Canada—The Canadian National. This national railway has adopted a policy pushed by the American Federation of Labor, known as the B. & O. Plan, called so because it was first initiated by the Baltimore and Ohio Railroad in the U.S.A. It has led to the promotion of many safe and servile company unions there.

The masters needed a scheme to kill any militant union activity and also to increase output while silencing workers’ complaints. The B. & O. Plan is a brand of efficiency systems which pretends to make for profit sharing and fosters “co-operation” between master and man. A pliable tool was found in the American Federation of Labor Unions, which was given special privileges to enlist membership and to smooth the path for the adoption of the masters’ plans. The One Big Union complain that the American Union has been given sole recognition, with the result that either dismissal or joining the American Federation has been forced on the men.

Speeding-up and spying on each other, which is the common feature of co-partnership systems, has become the rule. The O.B.U. complain that J. H. Thomas is at the head of the “forceful” union they are fighting. They are applying to the Privy Council for the right of assembly and freedom to join a union of their choice.

So much for Government ownership or nationalisation, the aim of Labour Parties. The One Big Union has to face the fact that business, nationally or privately owned, is carried on for profit, and concentration of industry collectively in investors’ hands—called national ownership—simply provides a more, powerful force against the workers.

The municipalising or nationalising ideas of many of the workers in Canadian Unions has been given a nasty blow, which should make them sec the need for political action for Socialism.

Adolph Kohn

SPGB Sunday Evening Meetings. (1930)

 Party News from the September 1930 issue of the Socialist Standard

A Socialist Searchlight: No More Class War (1930)

From the September 1930 issue of the Socialist Standard

No More Class War

“During the last twenty-five years, he said, thousands of rich people had come to see that the host thing they could do in life was to share in the great task of improving conditions of the community. 

The time, he believed, was not far distant when rich and poor would co-operate in serving the community.”

No, it was not Mr. Churchill who said that, but Mr. George Lansbury, at Rotherham (“Daily Herald,” July 21st).

This First Commissioner of Works, and Christian Evangelist, visited Russia a few years ago, and in his book, “What I Saw in Russia,” grew lyrical over “the achievements of Russia,” compared with the miserable efforts of Capitalism at home.

Although the rich have been helping’ the poor so much here, there are faint rumours that for many years past the employers have been busy reducing wages and smashing strikes. The kind-hearted employers who are going to co-operate with the poor, are still very active in keeping a system going which produces poverty for the worker and profits for the idler. What better evidence do you want than Lans-bury’s speech, to prove how the Labour Party serve Capitalism? Don’t struggle, but love each other. Lansbury used to say at the Mission that only the love of Christ could save us, but now the rich have taken on Christ’s work. That is what has made Bow and Bromley such a paradise.

* * *

The Bankers’ Friends

Labour in office shows how it practices continuity in capitalist policy “The Times” complimented “Labour” on effecting’ such a close relation between finance and industry when they got the Banks to agree to rationalize the factories. The Bankers, with Labour’s approval, formed the National Industrial Development Co., Ltd. Montagu Norman, of the Bank of England ; Sir Guy Granet, Railway Director, and of Higginson & Co., World Financiers; Baron Schroeder, famous in the Ruhr Steel Combines, and of Schroeder’s, the New York Bankers; Peacock, of Baring Brothers; and Wagg, the Finance Merchant—these became the directors of the new concern to buy up and rationalize the profitable industries. Once Labour screamed about the Bankers’ power ! That was only when out of office. Now they have earned the affection of “finance” by encouraging Bankers’ control over production more than ever.

While “Labour” cried out that their schemes were being shelved because local bodies were sabotaging them, they appointed a Public Loans Board to advise what loans should be made to local authorities. They appointed the same board of Bankers the Conservatives had selected five years before. Then a few backbenchers objected to Lord Hunsdon being on it, because he said the miners should be starved into surrender in 1926. The Labour Government have drawn fulsome praise from the poisonous Newspaper Press by squashing their own members and getting Lord Hunsdon reappointed with Liberal and Tory support in Parliament.

Yet there are still workers who tell us that Labour is opposed to the Capitalists ! Let them learn from such practices as the above how well the Labour servants obey their masters. When the workers become Socialist, and control the Parliaments for Socialism the Labour politicians will be able to seek solace with their friends, the Bankers, and they can take the Mace with them to where people want entertainment, instead of a sane social system.

* * *

The Confessions of a Clyde "Red.

    “The only time in my life that I have allied myself with the enemies of the workers has been since I came to the House of Commons, and that is by the order of the Labour Government. Almost every time I go into the Division Lobby I join such tried and trusted friends of the Labour Party as Lloyd George, his daughter, Sir Herbert Samuel, etc. They are keeping the Labour Party in office on condition that the workers and the Labour Party programme are deserted.”

Thus writes the Labour M.P. for Shettleston (“Forward,” August 2nd). He was, however, the official Labour candidate, and stood for the official Labour Party Programme. He was attacked during the election by another Labourite, Mr. C. Diamond, who has been on three occasions official Labour candidate, and who stated that he has supported the Labour Party because it is not committed to Socialism.

The Party that the Member for Shettleston—McGovern—stands for, is not out for the working class. Read his own words: –

 “There is no danger of chasing away the Liberal votes, as they have all joined us at Westminster. The Labour Cabinet coddle them too much to drive them away, and are more concerned about them than about the working class.”

He became the official Labour Candidate—because it’s the best way to get elected. “Getting in” —that’s the game, even if it means going into the Lobby to vote against the programme he ran on.

The little conflict between the “wings” has now been settled at a joint meeting of the Labour Party and I.L.P., and the following terms were agreed upon: –

1. That the I.L.P. accepts the Labour Party Annual Conference as the supreme authority of the organised political movement of the workers.
2. That the I.L.P. wishes to remain in affiliation with the Labour Party. (Forward, Aug. 2.)

So, now Lloyd George, the I.L.P., and the Labour Party may continue their united front—in the same Lobby.

C.

Blogger's Note:

The Confessions of A Clyde 'Red' had previously appeared on the blog as a separate piece. I'm guessing I cherry picked it at the time 'cos it was about John McGovern and because of the location of his parliamentary constituency.

Voice From The Back: South of the Border (2008)

The Voice From The Back Column from the August 2008 issue of the Socialist Standard

South of the Border

From old Frank Sinatra songs to Hollywood movies about Rio beaches, with beautiful young men and women the image is projected about the wonders of Brazil. The reality is less gorgeous. “A study by the government’s Institute for Applied Economic Research showed that the richest 10 percent of Brazilians hold 75.4 percent of the wealth. Thanks to a regressive tax system, they only lose 22.7 percent of their incomes to tax, compared with 32.8 percent for the poorest 10 percent of Brazilians. In Rio, only a handful of slums out of more than 600 in the city are in line for improvements under the federal program, leaving many feeling left out.” (Yahoo News, 8 July)

An Ill Divided Society

We often hear of the plight of workers in various parts of the world who try to survive on less than $1 a day but it is hardly of any consequence to most of the following group of rich parasites. “The combined wealth of the globe’s millionaires grew to nearly $41 trillion last year, an increase of 9 percent from a year before, Merrill Lynch & Co. and consulting firm Capgemini Group said Tuesday. That means their average wealth was more than $4 million, the highest it’s ever been. Home values were not included in asset totals.” (Yahoo News, 24 June)

Learning About Capitalism

Every child that is born has to be taught about the crazy system of ownership and poverty that is capitalism in order to survive in this dog eat dog society, but even supporters of this system with its insatiable greed for profits would surely draw the line at the following piece of “shrewd” business strategy. ” Thousands of children as young as 11 have been sent debit cards by Lloyds TSB without their parents’ consent. One 15-year-old reportedly used the card to buy cheap cigarettes, Viagra and fake adult identification on the internet.” (Times, 5 July)

The Mad House of Capitalism

He is reputed to be the richest man in the world so the recent downturn on the world’s stock exchanges has led to speculation that Warren Buffett may be ready to plunge into an increasingly bearish market. “During the great bear market of 1974, Warren Buffett was asked by a rather staid fellow how he felt. “Like an over-sexed guy in a whorehouse”, he replied. “Now is the time to invest and get rich.” (Observer, 6 July) Whether he in fact invests or not the richest man in the world, said to be worth $35 billion, certainly has a rich use of the vernacular. As Bob Dylan once sang “Money doesn’t talk – It swears!”

How Capitalism Operates

We are constantly amazed at the current ignorance about how capitalism operates. Chancellors that claim they can get rid of slumps and booms, prime ministers who believe that a series of reforms will solve social problems, but this piece of nonsense takes a bit of beating. “Adam Sampson, chief executive of Shelter, said: ‘Mortgage lenders have made billions from first time home buyers and Shelter believes it’s now the turn of those lenders to help them.’” (Metro, 10 July) What Mr Sampson does not seem to realise is that capitalists makes their fortunes from rent, interest and profit not from some benign urge to “help” borrowers! Perhaps it’s “now the turn” of Mr Sampson to learn a little bit about the basics of capitalist society.

Patriotism Goes Mega

Away back on the 7th April 1775 when Samuel Johnson wrote “Patriotism is the last refuge of a scoundrel”, he couldn’t have imagined how much modern capitalism would use patriotism to enslave the working class. “On the field before the All-Star Game, Major League Baseball plans to assemble the largest gathering of Hall of Fame players in baseball history. And as fans salute their heroes, the former players will join the crowd in saluting the American flag — one that is roughly 75 feet by 150 feet, as long as a 15-story building is tall, spread horizontally over the Yankee Stadium turf. That is a relatively small flag by big-event standards in American sports these days. But it will signal the latest can’t-miss blend of sports and patriotism, a combination increasingly presenting itself through gigantic American flags, unfurled by dozens or hundreds of people in an attempt to elicit a sense of awe and nationalism in the surrounding crowd.” (New York Times, 4 July)

Material World: Campaigners for humanitarian intervention: “useful idiots” of militarism (2008)

The Material World column from the August 2008 issue of the Socialist Standard

There is nothing new in governments claiming to be motivated by humanitarian concerns when they go to war. To take a couple of old examples: tsarist Russia supposedly fought the Ottoman Empire in order to rescue Armenians from massacre by the Turks, while British intervention following the German invasion of Belgium in 1914 was justified by lurid drawings of “Huns” skewering babies on their bayonets (www.spartacus.schoolnet.co.uk/FWWatrocities.htm). The enemy atrocities might be real, as in the first example, or imaginary, as in the second, but in both cases the claim of humanitarian motivation was fraudulent. Governments decided for or against war on the basis of (sometimes erroneous) calculations of economic and strategic interest.

That remains true today. Never, however, has it been more important for governments to win public support for wars by claiming humanitarian motives. As in the past, some of the “facts” underlying the claims are fabricated. Thus, Tony Blair repeatedly claimed that 400,000 bodies had been found in Iraqi mass graves, although the number of corpses uncovered was only 5,000.

But again, the claims are false even when the facts are true. Often this is obvious because the atrocity occurred long before foreign governments expressed any outrage over it. Why bring the matter up just now? Britain and the US had no objection when Saddam used poison gas on Kurdish villages in 1988 because at that time he was their ally. The weeks preceding the dispatch of British troops to Afghanistan were marked by a media campaign against the oppression of women in that country, with even Cherie Blair roped in. The issue was then dropped as suddenly as it was raised.

A public movement for humanitarian intervention

What is new is the emergence, within the broader human rights movement, of a loosely organized network that campaigns for military intervention wherever that seems to be the only effective means of halting or preventing genocidal atrocities against some ethnic group. Currently, for example, there is an international campaign for intervention in Darfur (Sudan).

During my non-socialist period, I was involved for a while in one of the organizations that makes up this network: the Institute for the Study of Genocide (ISG). My research, publicized through the ISG, helped to bring the massacres of Bosnian Moslems by Serb militias to the attention of the US media and politicians – including, notably, Bill Clinton, who at that time was campaigning for president. Later Clinton did intervene militarily in Yugoslavia, though over Kosovo rather than Bosnia.

Unlike governments, anti-genocide activists like the ISG have quite genuine humanitarian motives. They recall how “the world sat by” and allowed the Armenian genocide and the Holocaust to proceed. (Though at war with Nazi Germany, the Allied command turned down pleas to bomb the railway lines leading to Auschwitz.) They are determined to establish humanitarian considerations as an integral part of policy making, so that “we” will not let such terrible things happen again.

Any decent person will sympathize with this line of thought. But there is a problem with it. Let us shift our focus from the moral imperative of effective action to the political forces capable of such action. Who is “the world”? Who is “we”? The only “we” capable of intervening is governments with their armed forces. But governments do not exist for humanitarian purposes. They are therefore loathe to intervene for humanitarian reasons, and it is close to impossible to compel them to do so.

Pros and cons

From the point of view of governments, the existence of a public movement for humanitarian intervention has both pros and cons. It is irritating and embarrassing to have to face down emotional public demands to intervene in places where no important “national interests” are at stake – in Rwanda, for instance, or Darfur. On the other hand, when you are inclined to intervene anyway for other, more “important” reasons it is extremely convenient to have a public movement pressing for intervention. That makes it much easier to drum up public support for war, and at the same time you can enhance your democratic credentials by “responding to public opinion.”

In the case of Yugoslavia, the demand to intervene effectively over Bosnia was resisted, but the campaign in which I participated prepared the ground for intervention over Kosovo. The evidence now available suggests that in Kosovo, in contrast to Bosnia, there was never any real danger of genocide (as opposed to the usual ethnic cleansing). In Kosovo, however, and again in contrast to Bosnia, significant interests were at stake, such as a major oil pipeline and metal-mining complex (see April 2008 Socialist Standard).

Illusory success

It may appear to campaigners for humanitarian intervention that they have a certain limited success. They “win some and lose some.” But if we look more deeply into the real interests involved we see that their success is largely illusory. It is by no means clear that their efforts have the net effect of reducing the amount of suffering in the world. In fact, by supporting and helping to legitimize brutal and devastating wars they may well increase the total of suffering.

The epithet “useful idiots” (or “useful fools”) was used to pillory Western pacifists who supposedly served the interests of the Soviet Union, though without intending to do so and for the best of all possible motives. Jean Bricmont borrows the expression for a different purpose, calling campaigners for humanitarian intervention the “useful idiots” of Western militarism and imperialism (Humanitarian Imperialism: Using Human Rights to Sell War, NY: Monthly Review Press, 2006). Again, this is not meant to cast any aspersions on their motives.

As socialists we would only question the stress on “Western.” In principle such people could equally well serve as useful idiots for non-Western (Russian, Chinese, Indian, etc.) militarism and imperialism, though in practice they are active mostly in Western countries.

Calls for humanitarian intervention only make sense in terms of a false conception of the nature and functions of government. They feed a delusion that obscures the reality of our capitalist world, thereby making it harder to overcome that reality.

Stefan

Who Pays for Health Care? (2008)

From the August 2008 issue of the Socialist Standard

This year is the 60th anniversary of the National Health Service. Workers like it, but capitalists don’t, at least not any more. Why?

That the NHS became old enough to claim its bus pass last month will be a source of pride to members of the Labour Party – something to hold in their hearts as the gloom gathers around their fading regency over Britain.  60 years of providing health care free at the point of use is something that socialists can acknowledge, albeit with qualification.  Likewise, the continued existence of such a service sticks in the craw of the purist ideologues of capital, and serves as a constant irritant to the rapacious demand of capitalism for profits.  That accounts for why the health service remains at the heart of the political battlefield.

For example, when the Daily Telegraph celebrated the fiftieth anniversary of the end of food rationing in 2004 they used it as an excuse to have a pop at the health service.  After all, if rationing – which they claimed was, in effect, a National Food Service, was not needed, then why have a National Health Service? (www.telegraph.co.uk/money/main.jhtml?xml=/money/2004/07/03/cmian03.xml). Socialists would, of course, argue the exact opposite – and that is what the Torygraph’s hacks were exactly afraid of, the threat of the good example.

So afraid, that they try to turn it into the bad example.  Following the most energetic proponents of capitalism, they maintain that state run services cannot be efficient.  This is a line that ultimately stems from the Austrian economist Ludwig Von Mises, who argued that without markets in capital (i.e. productive goods) rational resource allocation could not be made.  His latter-day followers would argue that the NHS can only function because it can approximate the prices of its goods from general society; but, that in that approximation it still cannot achieve due efficiency.

Others follow the other Austrian economist Freidrich Hayek in asserting that without entrepreneurship, the managers of a state bureaucracy lack incentive and drive, and thus do not serve the customers (i.e. patients) as well they might.  These folk would also argue that information does not flow freely within the NHS, and cannot effectively do so, for much the same reasons.  They point to manipulation of statistics and fiddling to meet central government targets as proof of this.

It has been traditional to use waiting lists as proof of that inefficiency, and Labour has spent the last ten years desperately trying to prove those waiting lists can be eliminated.  These, though, only exist because the NHS is a government bureaucracy that aims to treat everyone – were it a market led system, those lists would become invisible, as those who couldn’t afford to pay would cease to present themselves, and the dreaded rationing would occur unseen.  Indeed, that was the situation at the foundation of the NHS, where the war had seen the state discover just how unhealthy the population was when they were shanghaied into battle.

Another favoured trick has been to compare, say, the number of expensive scanners in the United States to those in the UK.  Although the US does have higher numbers, much of that is driven by different medical priorities, and, more importantly, different donor priorities.  As much medicine in the US relies on charity (itself a sign that markets cannot provide the service required) their funding is subject to potlatching – spectacular donation one-upmanship in which big, shiny projects will be privileged over more mundane treatments.

Of course, the NHS has had serious funding/allocation problems. In its early days demand was much higher than anticipated, and so consequently it cost more. (Link.) Since the 1980’s successive governments have tried to rectify its perceived shortcomings through creating pseudo-markets.  The problem is, however, for the die-hard agents of capital, pseudo markets will never be good enough.

This can be seen from the more recent propaganda.  Following a Office of National Statistics report in April this year the Telegraph proclaimed “NHS gets more money but productivity falls”. They alleged that “billions of pounds of extra investment in the health service has led to a 10 per cent drop in productivity,”  because:

“Although more patients are being treated on the NHS with more operations being carried out, more drugs being prescribed and the population enjoying better health, the rise has failed to match the increase in investment, a report from the Office of National Statistics shows.”

That is, although all of these manifest improvements were occurring, the Telegraph spun it as a decline in productivity which meant that “unless NHS productivity can be improved the principle of a health service funded out of general taxation may become unaffordable, experts warn.”(Link)  All this because the ratio of money spent to the outputs achieved declined (or rather, the outputs did not rise as fast as the increased expenditure)

The cold, cold logic of capital: if the returns aren’t good enough, if the money could be more profitably spent elsewhere, then it should be so.  The actual concrete outcomes become a secondary consideration behind the magnitude of the capital involved.  Another recent government report indicates how this might weigh on the capitalist mind.  The report, the annual “Value added scoreboard” (www.innovation.gov.uk/value_added/default.asp?page=76) looks at company accounts in the UK and across Europe to show which firms have added the most value to the economy.  It defines value added as: Value Added = Sales less Costs of bought-in goods and services:

“Value Added can be calculated from a company’s accounts by adding together operating profit, employee costs, depreciation and amortisation/impairment charges.”

That is, it does not measure value as a ratio of total capital invested, but as a fraction of year on year expenditure.  For the government and for capitalists, it’s a measure of how well firms are meeting peoples’ desires (apparently).  For socialists, this is a very good thing to measure, since, after all, this shows pretty accurately how much workers are exploited for – all that value added is our unpaid labour being realised – something like £646 billion in the top 800 companies.  Of that, £3.5 billion is accounted for by “health care equipment and services.”  Given that the NHS costs an annual £89.7 billion it’s clear that were its services to be made commercially available, then the headline value added figure for the UK would rise, and health care as a sector would leap up in terms of the national league tables.

Capital with its incessant drive – accumulate, accumulate – looks upon all that capital, all those potential profits, all that money pouring into the NHS and dreams of taking it for itself, of taking out its state rival and bringing the riches and all that potential surplus value into its own cold avaricious arms.  It would also mean not having to pay the dreaded taxes that the government snatches.

Although socialists recognise the benefits the NHS brings to workers who otherwise would not have access to healthcare, they are far from the ardent uncritical supporters that the membership of the Labour Party tend to be.  They see that although the NHS suggests possibilities for how a service free at the point of use and based on needs could be organised, fundamentally, it is not free from the market system and a long way from being the fount of joy Labour supporters proclaim it to be.

Although the NHS has to simulate markets internally (much as many big companies do) it actually exists within a market economy.  It competes to buy drugs, materials and even staff.  When the Telegraph bewails that much of the money poured into the NHS over the last ten years went into wages and salaries, it is commiserating over its own basic principle: that people should try to enrich themselves and get the most for their skills and abilities that they can.  NHS workers are compelled by the threat or prospect of poverty to play the market game as best they can.

Likewise, it must buy hospitals and premises from commercial builders and landowners.  It has to pay the form of rent known as a patent to the drugs manufacturers. And it has to have the payroll clerks, the accountants, the procurement officers, the lawyers and the whole array of staff specifically to manage all of this market activity, adding greatly to its cost.

Further, technical innovation comes with a market drive.  As the BBC points out in a special report for the anniversary, “all the new machines and robots that are becoming available for health care cost a fortune, can the NHS afford to keep up with innovation?” (news.bbc.co.uk/1/hi/health/7477627.stm). As with any other industry, capitalism is constantly revolutionising the process of healthcare.  More and better results can be achieved with more and better machinery – that is with ever greater capital investment.  Personal healthcare has always been relatively labour intensive, and it would be politically inconvenient to try and rationalise staff costs the way that an ordinary capitalist firm would – with wage cuts and redundancies.

This interweaving with the market system also nullifies some of the wilder claims that the NHS is a massive benefit to the working class – many capitalist states manage to exist without such a system.  Health costs are, for the most part, not optional, you either need treatment or you don’t (though the poor are long adept at putting up with ailments it’s too dear for them to pay to relieve).  By hook or by crook, if the employers want to have a workforce fit to perform their role, it’s going to have to pay for health care.  This can either be done through wages directly, or as a workplace benefit or through the state.  If provided as a state or private benefit, it simply has the effect of lessening the upwards pressure of wages by workers who need to pay for their and their loved one’s treatment.  If it was paid directly through wages, employers would have to risk paying those sums to workers who might never need health treatment: i.e. they’d be paying them (in the employers’ eyes) too much.

Let’s be clear, this is an automatic effect of the wages system. The proponents of the NHS are sincere (for the most part) in believing that it brings a massive benefit to society.  Certainly, it helps the Labour Party by being a threatened cherished item to rally their supporters around and with which to beat the Tories.  The wages system, though, which will only return to the workers the price the market will bear for sustaining their ability to work can snatch with one hand what the state gives with another.  Our health and well being only matters so far as it enables employers to use us for profit, as can be seen in those parts of the world where surplus population is left to rot.

The health service, also fails to address that other feature of the market system: inequality.  The figures are quite starkly clear.  For example, in the London Borough of Camden – home to some of the most deprived parts of the country – the difference in life expectancy can be a decade.  A man living in Belsize ward can expect to live to be 80.2 years old, while less than a mile away in Kilburn the life expectancy is 69.9 years.(www.camdenpct.nhs.uk/pages/go.asp?PageID=621).  Just a mile or two more away in Somers Town (the ward which includes Kings Cross station, and St. Pancras International – with the longest Champagne bar in the world) death rates are 35 percent higher than the national average.(Link.)

This is part of a worsening trend:

“During the period 1972-6, the gap in life expectancy between social classes I and V was 5.4 years for men and 4.8 years for women. By the time New Labour succeeded the Tories in government, these gaps had risen to 9.4 years and 6.3 years respectively.” (See tables 1 and 3 in: ‘Life expectancy by social class’, UK Government Statistics.  

 “Kill, kill, kill, killing the poor”, as the Dead Kennedy's sang.  It is clear that the effects of poverty, and the associated lifestyle are deleterious to health, and that simply having the services available of the NHS isn’t sufficient to stop the theft of years from the working and unemployed poor.

Pik Smeet

Simon the Sociobiologist (2008)

From the August 2008 issue of the Socialist Standard

Cooking the Books: Sinned against not sinners (2008)

The Cooking the Books column from the August 2008 issue of the Socialist Standard

“PAY RISES DON’T CAUSE INFLATION – AN INCONVENIENT TRUTH FOR DARLING” was the headline in the Daily Telegraph of a recent article by the unspeakable Simon Heffer (25 June) . He was criticising the increasingly strident calls by the Chancellor of the Exchequer for pay restraint so as not to fuel inflation. Heffer’s argument was that as rising prices have been caused by the government allowing too much money to get into circulation they can’t be stopped by holding back wages.

We have to admit that he is basically right. Insofar as rising prices in Britain are not due to other factors such as rising world oil and food prices (since rising prices and inflation are not the same), if the government overissues the currency, i.e. puts more into circulation than enough to make payments, pay taxes, settle debts, etc, then all prices will tend to rise. As wages are a price – the price of a person’s ability to work, or what Marx called their labour power – they too will rise. So to blame inflation on wage increases is wrong.

So, sometimes a nasty person can be right. Heffer reminds us that another obnoxious character, Enoch Powell, was saying this about inflation in the 1960s. He quotes something Powell said about the wage restraint policy of the Wilson Labour government. Powell was even clearer in a speech he made on 20 November 1970 about the similar policy of the Heath Tory government:

“Wage claims, wage awards, strikes, do not cause rising prices, inflation, for one simple but sufficient reason – they cannot. There never was a strike yet which caused inflation, and there never will be. The most powerful unions, or groups of unions, which was ever invented is powerless to cause prices generally to rise … in the matter of inflation, the unions and their members are sinned against, not sinning. In the matter of inflation, the unions and their members are as innocent as lambs, pure white as the driven snow”.

We couldn’t agree more and said so at the time. There is, however, a point of difference. Heffer (and Powell himself sometimes) suggests that it is government spending as such that causes inflation (Heffer is a mad marketeer who wants to reduce government spending and interference so as to let the market rip). But this is not necessarily the case. If it is financed by overissuing the currency, government spending will have this effect, but inflation is not due to the particular way the excess money is spent (in this case by the government to finance its spending) but to the fact that it has been issued in excess.

Darling may be cleverer than Heffer gives him credit for. The job of all governments is to preside over the operation of the profit system and to try to ensure that profits are protected and maximised. So they are always against pay increases, irrespective of whether or not prices are increasing. Darling may just be using the current spurt in prices as a pretext to reiterate what is a permanent policy of all governments.

The End of the Market (2008)

From the August 2008 issue of the Socialist Standard

Is there an alternative to the market and what is it?

‘The market’ may be taken as a generic term to include markets of all kinds: places (not necessarily physical) in which goods, services and people are bought and sold, offered for sale, rejected or bargained over. Markets imply a medium of exchange, usually money in some form, although barter is a form of exchange without money.

The market system is one way of regulating relations between producers and consumers and between owners of capital and labour. There are in fact three ways of regulating relations between producers and consumers: by the ‘free’ market, by the unfree or controlled market and by no market. These represent market capitalism, state-controlled or ‘command economy’ capitalism, and socialism respectively.

No society has been or is 100 percent free-market capitalist. Every human activity and item of wealth would have to be marketed to make it so. No society has been or is 100 percent state-controlled capitalism. Some private enterprise or free marketing was always allowed or even encouraged in so-called communist countries. The principle of ‘no market’ means simple giving and taking based on understanding, reasonableness and trust. It is present in some activities and some goods and services in all societies, in domestic and voluntary work, for example. But nowhere (except in small communities) have productive and social relations been dominated by the non-market principles of common ownership and free access. In other words, since the first form or property was introduced in ancient civilisations, some form of class society based on some form of possession and market transactions has always been dominant.

The history of the market would make a fascinating subject for research, but there is no space to go into it here. However, a few words about the relative strength of free-market capitalism and state capitalism during the 20th century may be useful.

State capitalism probably reached its high point with the establishment of the Soviet Union in 1917. Fraudulently using the labels of socialism and communism, the leaders of the Communist Party put as much economic activity as possible, including markets, under the control of the state. Eventually, the controlled, centrally organised, ‘command economy’ form of capitalism proved less efficient than the ‘mixed economy’ form, and now the former Soviet Union countries are as free-market capitalist as most other parts of the world.

In post-war Britain there was a similar reaction against free-market capitalism. Beveridge reorganised poverty in the welfare state. The original National Health Service enabled people to get glasses and false teeth free at the point of consumption. This was hailed as socialism, but again it was a fraud. The best that can be said of such measures is that they were the result of a feeling among supporters of capitalism that it could in some respects be better run by the state intervening on behalf of all capitalists rather than letting uncontrolled market forces produce too much inequality and discontent.

Today free-market capitalism is in the ascendancy around the world, despite all its crises. Not everything is privately owned and bought and sold in a market, but more and more industries and services are being privatised. As compared with a century, or even a decade, ago, what might be called the market for markets has grown enormously. To take just a few examples, labour markets for parliamentary lobbyists, spin doctors and corporate headhunters have developed. Bankruptcy specialists and leisure consultancies are flourishing. Sperm is marketed on the internet. In the information market, business skills video providers rub shoulders with computer dating agencies and weather forecasting bureaux. Genetic testing at a hefty price will tell customers who is the real father of their child. In Japan if your child is short of a grandparent you can go into the market and hire one.

Of course, market penetration, as it is called, is never complete. Much human activity is still outside the market. However, it is not too cynical to say that if a way could be found to bottle the air we breathe, such a market would be created. Domestic work, voluntary work, and serious leisure are largely, but not wholly, outside the market. We still have to buy household cleaning items, but we don’t usually charge for doing the washing up. About one in six people in Britain – more in America – give up some of their spare time to help others voluntarily (though some employees do paid work for voluntary organisations). Serious leisure – regularly getting together with others to pursue common interests for pleasure – is mostly a non-market activity (though some participants have to buy things from the market to pursue their serious leisure).

What are the good things and the bad things about the market system? The good things are said to centre around being able to exchange things, stimulate competition, and produce new goods and services. It is claimed that without a means of exchange, expressing the price at which goods and services are bought and sold, no one would be able to exchange what they had for something they needed. Obviously, within capitalism this is true: without a labour market (free or controlled) no one would be able to sell their labour power and ‘make a living’. But this is only because both capitalists and workers accept that labour is a commodity to be bought by the capitalist class or the state and sold by the worker. If, instead of being in the hands of a small minority, the means of wealth production were common property, then that ‘advantage’ of having a market would disappear. We wouldn’t need to sell our labour power to live, and it wouldn’t be possible for capitalists to buy it and live on the surplus value it creates.

A second supposed advantage of the market system is that it stimulates competition, especially if it is ‘free market’. This means that buyers shop around for what they want (or are persuaded to want) at the cheapest price, while sellers hold out for the highest price. This may sound a good idea if you are deciding which supermarket to shop at for the best bargain, but it’s not so good if you are competing to sell yourself on the labour market. You may get a slightly better wage or salary if you join a union, but there is no guarantee you won’t be ‘priced out of the market’, i.e., sacked and unable to compete successfully for another job.

A third stated advantage of the market system is that a market can be created for almost anything – in theory for everything. Is this such an advantage? As compared with feudalism and early capitalism, late capitalism offers those with money a myriad things to buy – unnecessary things, ludicrous things and sometimes harmful things. A fourth television set for the bathroom, a fashion haircut for the dog, a state-of-the-art security system or weapon to protect yourself against robbers. The worst obscenity is the indifference to real poverty and suffering that the market-mediated pursuit of trivia brings: people worry if they miss an episode of their favourite ‘soap’ while millions in the world starve.

Now for the bad things about the market system. I have already touched on some of these when questioning the good things. The labour market is unlike all other markets in two respects. The owners of labour power have to sell something that is capable of producing more than its own cost. And, by having to sell themselves rather than something they possess, they are at the mercy of the buyer, who can dictate, with the help of the state, not only the terms of the transaction but whether it takes place at all.

Competition is an essential feature of the market system. It rewards winners and penalises losers. Socialists may disagree about whether all competition will disappear in a socialist world (I would personally argue that playing games and sports where there are inconsequential winners and losers can develop skills and be good fun). But the kind of cut-throat competition engendered by capitalism cannot be justified. Making excuses for the excesses of the competitive market system is a kind of Nuremberg defence: ‘I was only carrying out orders given by my customers’. The invisible hand of the market can be a cruel hand, destroying and damaging its victim losers, while enabling its ‘top’ winners to live selfish, pointless and distorted lives.

The waste involved in the market system is tremendous. Think of all the useless and harmful jobs (often dignified by the title of profession or career) that are created. People working in banking, insurance and financial services produce nothing of real value, nothing that a society based on production for need and free access couldn’t happily do without. Commercial advertising uses up far more human and material resources than required to inform people of what is available. The worst example of waste is war and preparation for war. A mind-boggling $1,000,000,000,000 is spent each year on this around the world. Countless deaths and injuries have been caused by weapons used to defend and acquire markets and associated spheres of influence in which the workers of the world have no real interest.

To turn now to the marketless, moneyless world that will replace the capitalist market system. First, the absence of money, though it is certainly a feature of socialist society, is not a defining characteristic of that society. The absence of money is a negative idea. Money will not be needed as a means of earning a living or registering the ownership of capital (incidentally, money may well survive but only in inconsequential money games or historical re-enactments).

The positive definition of socialism is a society in which the means of wealth production and distribution will be commonly owned and democratically controlled in the interest of the whole community. It will only be possible when a majority of people (workers) understand, want and work for such a revolutionary change. They will work, not in a labour market, but to produce goods and services that they and their fellow human beings need.

Marx once said that he didn’t want to write recipes for future cookshops. We can agree with him that we shouldn’t try to draw up blueprints for the details of how to run a socialist world of the future. The people at the time will decide those details. But we ought to be interested in principles, in the ingredients to be used and the social relations to be entered into in future cookshops and other places.

A socialist world will only be possible by people behaving in pro-social ways. We do not ask for a fundamental change in human nature. None is needed. Even today, with the market system dominant and people encouraged to look after themselves first, most men and women behave pro-socially when they see someone in need of help. Market forces are forces alien to the best in human nature (human behaviour would be a better term). The building of the world socialist movement is a task for those not passively submitting to the discipline of the market but able and willing to help create something better for themselves and their fellow humans.

Stan Parker