What achievements? - we are asked. Our opponents would say these do not amount to much. How many MPs do we have? How many members? So what is this talk of achievements if not merely whistling in the dark to keep our spirits up? The best answer is for us to take a look at the party's historical record. After all, principles, however logical, are no use unless they hold up and are valid when applied to changing circumstances. An early Greek materialist philosopher used the analogy of a river: although each moment you look at it you see constant changes, yet still it is the same river. That in the last hundred years there have been significant changes in capitalism is undeniable. But we would argue that it is equally true that the basis of the capitalist system, the exploitation of the working class through the wages system, remains essentially unchanged. If so, it follows that the party's Principles are as valid now as they were a hundred years ago. First, by setting out as the Party's sole OBJECT the establishment of Socialism/Communism, and stating clearly what this meant, the Party founders rejected any programmes of 'immediate demands' or 'palliatives'. That meant a break with the parties of the Second International, such as in Britain the Social Democratic Federation and the Independent Labour Party. All those parties, while claiming to be Socialist (or Social Democrat) parties, in fact put forward a variety of reform proposals to woo the voters. Rejection of reformism was, and is, central to The SPGB position. To take this line took courage: it was a leap into the unknown. This was the only party in Britain that stood for Socialism and only for Socialism. It still is. The DECLARATION OF PRINCIPLES makes the case for Socialism as being in the interest of the working class, i.e. on the basis of the class struggle - the "antagonism of interests" between the parasitic capitalist class and the working class "by whose labour alone all wealth is produced". This conflict of "interests" can only be ended by "working class emancipation" and the "establishment of common ownership of the means of production and distribution with democratic control by and in the interest of the whole community". In the last 100 years, generations of workers have joined The SPGB, recognising how as members of the working class they are exploited under the wages system. Class-consciousness is the basis of The SPGB case for Socialism, just as it is of the political organisation needed to establish Socialism. A class-conscious working class is an essential pre-condition for Socialism. The clarity of the Party's theoretical argument meant that, after the Bolshevik Revolution, The SPGB opposed the claim that Socialism was established in Russia, where a system was being established that, later, even Lenin described as "state capitalism". Soon after the Russian Revolution (October 1917), The SPGB argued that whatever was being achieved in Russia simply could not be Socialism: was peasant Russia, with its small, urban proletariat, its economy in ruins, its cities' populations starving, ready and able to establish Socialism? Unless a mental revolution such as the world has never seen before has taken place, or an economic change has occurred immensely more rapidly than history has ever recorded, the answer is "No!"... There is no ground whatever for supposing that they [the peasants] are ready or willing to accept social ownership of the land, along with the other means of production. SOCIALIST STANDARD, August 1918, reprinted in 1948 pamphlet, RUSSIA SINCE 1917. Likewise when the Labour Party put forward a policy for nationalisation, calling it Socialism, The SPGB opposed that as just another scheme for trying to solve the problems of capitalism: The thing [nationalisation] is a transparent fraud. Making nationalisation pay means making it pay the millions that the Government is handing out to the former owners. The exploiters >are still living on the backs of the workers, with the difference that the Labour Party, as the Government, undertakes official responsibility for maintaining the exploitation (1945 article, quoted in our 1997 pamphlet, NEW LABOUR - A PARTY OF CAPITALISM). Another mistaken Labour policy, which was also claimed to be Socialist, was the so-called Welfare State - the NHS and National Insurance. The SPGB analysis of any state 'welfare' policies was rooted in our understanding of exploitation through the wages system. When the wartime government increased the amount of the worker's weekly national health and pensions insurance deduction by one penny, the Party argued that this made no real difference: National Insurance The Wonderful World of Pensions for AllRelatively,
the position is the same as before - the worker has a bob or two stopped
out of his wages, the old age pensioner can still manage to escape
the workhouse by sponging on his poor relatives or, if there are none,
he can in most cases get a supplementary allowance from the public
assistance committee, and the employers think they have done a nice
little bit of business by making the worker bees save up for their
old age, so saving the expense of keeping them in institutions. We
hate to disillusion our capitalist masters, but would it make so much
difference if the whole vast governmental apparatus of deductions,
accounting and stamping were scrapped and the "pension"
paid out of general taxation? Actually, it would make but little difference,
for the worker's wages always tend to equal the cost of living - after
all, you must feed the beast to get the work out of him - so that
deductions from wages tend to be counterbalanced by increases in wages,
and in any case, it is the capitalist class themselves who fork out
the bulk of the taxation. As for the Beveridge Report and proposals for Family Allowances, later followed by Child Benefits, Child Credits and various complicated, means-tested, schemes to supplement low wages, the Party was unimpressed: The
great problem stays even if every dot and comma of the report is put
into operation. That problem is the outstanding social problem of
the age - the poverty of the working-class, and not just the additional
burdens borne in times of unemployment, old age and sickness, burdens
which incidentally Beveridge does little to lift. The poverty of the
working-class is due to the private ownership by the capitalists of
the means of production and distribution. Socialism alone can end
that poverty.... Such arguments remain valid now, decades later. Problems of working class life under capitalism are impossible to reform. Generations of reformers have tried unsuccessfully to square the circle, to find ways to support the unemployed, the sick, the disabled, the old, and other 'redundant' members of the working class, to have capitalism without the consequences of capitalism. THE POOR LAW REPORT (1834) declared as the key principle that "[the pauper's] situation on the whole shall not be made really or apparently so eligible as the situation of the labourer of the lowest class". The SPGB arguments on this subject are ones that echo Marx: Pauperism
is the hospital of the active labour-army and the dead weight of the
industrial reserve-army ... along with the surplus population, pauperism
forms a condition of capitalist production and of the capitalist development
of wealth. It enters into the faux frais of capitalist production;
but capital knows how to throw these, for the most part, from its
own shoulders on to those of the working-class and the lower middle-class.
Again and again, the class struggle was and is at the heart of the question. Since the class struggle is worldwide, as is the capitalist system, it follows that working class emancipation will mean the emancipation of all mankind "without distinction of race or sex". When war came in 1914, the party stated its internationalist position uncompromisingly, consistently and courageously. The war was fought over capitalist interests such as markets and trade routes, not over working class interests. The first wartime editorial emphasised the class war: The question for the working class, then, is not that of British or German victory, since either event will leave them wage-slaves living upon wages. Under German rule those wages cannot be reduced much lower than under British, for every British working man knows that the masters who are shouting so loudly for us to go and die in defence of our shackles and their shekels, have left no stone unturned to force wages to the lowest possible limits. The question, then, before the workers, is the abolition of the whole social system of which war and unemployment are integral parts, and the establishment of society upon the basis of common ownership of the means of production - the establishment, that is, of Socialism. SOCIALIST STANDARD, September 1914 The First World War put a stop to the Party's outdoor meetings, and many Party members disappeared - some conscripted, some jailed, others sacked or arrested, or both. To avoid conscription, some members went abroad and became active in Socialist propaganda in America, Canada, Australia, etc. In 1916 the authorities banned the Socialist Standard from being sent abroad (its contents "might be used by the enemy powers for their propaganda"!) and in 1917 the police raided the party's Head Office. In shameful contrast, the parties of the Second International, in all European countries, abandoned working-class internationalism. In Britain, while most Labour, ILP and SDP politicians supported the war, only The SPGB maintained, as a matter of policy and principle, throughout the war, the principle of international working-class solidarity. After the war, The SPGB MANIFESTO was republished with a new PREFACE, placing these parties' shameful betrayal on record: As
was to be expected, this mighty event proved a searching test for
all those who claimed to hold Socialist principles. At the very outset
[of war] the so-called International crumpled up, thus justifying
our long-standing criticism. In all the belligerent countries the
pseudo-Socialists, whom we had all along denounced as mere capitalist
cats paws, ranged themselves beside their respective war-lords, voting
war-credits, and acting as decoys to lure men of the working class
into the shambles. Everywhere organisations which had followed the
opportunist policy, trying to build themselves up on compromise and
political trading while claiming to be founded on Socialist principles,
found themselves caught in the toils when the test time came, and
the appeal was made to those passions and emotions that only Socialist
knowledge can destroy... THE
SOCIALIST PARTY OF GREAT BRITAIN was the only organisation in this
country that maintained the Socialist attitude on the war. Since
our inception as a party we have proclaimed the unity of interest
of the workers the world over, and the antagonism of interest between
the workers of the world and the master class thereof. The principles
which we had proclaimed and acted upon in "peace" were
sufficient to guide us in war. The party's attitude to capitalism's wars has stayed the same: wars are not fought in the interest of the working class but over the business interests of the capitalist class. The real enemy of the worker is the capitalist on his doorstep. As for the 'national interest', The SPGB rejects nationalism just as we oppose any ideology that divides the working class. The same principle applies to every such ideology - religion, racism and nationalism. Political Class StruggleThe party's PRINCIPLES are rooted in arguments put forward first by Marx and Engels in the Communist Manifesto, and later by Marx in the key policy documents he drafted for the International Working Men's Organisation. First in the Communist Manifesto and later, repeatedly and emphatically in policy statements of the First International, Marx argued that to achieve working class emancipation required class-conscious political organisation and action - " every class struggle is a political struggle" (THE COMMUNIST MANIFESTO). In 1871, the London Conference of the International passed a resolution on political action, drafted by Marx, asserting: Considering,
that against this collective power of the propertied classes the working
class cannot act, as a class, except by constituting itself into a
political party, distinct from, and opposed to, all other parties
formed by the propertied classes... Later in 1880, Marx drafted a brief theoretical introduction for the French Workers Party (Parti Ouvrier), which is worth quoting here since this too is echoed in The SPGB's DECLARATION OF PRINCIPLES: Considering,
Throughout most of the 20th century, The SPGB was united in arguing its case on the basis of its founding principles. The "emancipation of all mankind, without distinction of race or sex" was well ahead of its time in 1904 and increasingly relevant in periods of racism, and when the Left later turned to the divisive politics of race and gender. The SPGB's insistence on the need for the Socialist Party to be one that is independent of and opposed to all other political parties - an insistence which was also part of Marx's thinking - this was attacked both by those on the left who urged the Party to join forces with those in the Labour Party who called themselves Socialists, and by the supporters of Leninist vanguardism. To all such parties, we pose a threat, small as we are. And so they attack us as 'sectarian'. Only in recent decades have we had to fight "the enemy within". Only in recent times have we found amongst the members of this party those who wanted to overthrow the DECLARATION OF PRINCIPLES. First, they objected to the so-called 'hostility' clause. They wanted The SPGB to express support for such deserving causes as, say, democratic reform movements, regardless of whether such movements were at all interested in establishing Socialism. Some argued that the Party should become part of a broad "anti-market, anti-state" alliance. Some said that to argue the case for Socialism on such old-fashioned, Marxist grounds as the class struggle would not appeal to the man or woman in the street. In a period when 'direct action' was back in fashion, a 1984 Conference resolution, with echoes of 19th century anarchism, declared that Socialism "will entail the immediate abolition ... of the State". This ran counter to the Party's DECLARATION OF PRINCIPLES. Those
of us who objected were sneered at as mere "D of P-ers",
and finally forced out of the party. Those who engineered these expulsions
had decided their Party should no longer be called The SPGB but instead confuse the workers by calling itself
'the Socialist Party' (a name which to most workers means either the
Labour Party or some Trotskyist splinter group). They were confident
that their Party would be able to grow rapidly, once freed from the
restraints imposed by adherence to The SPGB's unifying principles.
Meanwhile, the reconstituted The SPGB is arguing the case for Socialism on the basis of The SPGB's founding DECLARATION OF PRINCIPLES. This we have been doing for over a decade now, vigorously, consistently, and without compromise on the central questions: the class struggle and the need to organise as an independent political party, opposed to all other political parties and working only for Socialism. A hundred years on, and the case for Socialism remains. The SPGB as ever argues for Socialism and only for Socialism - the whole bakery, not just a larger slice of the loaf. The various historic milestones on the way, such as wars, the General Strike, economic crises and the supposed inevitable 'collapse' of capitalism, the Russian revolution and the later supposed 'collapse of communism', among others - these have been marked by many betrayals of the Socialist cause and working-class internationalism by parties claiming to be socialist but in fact riddled and rotten with reformist opportunism. They have also tested the ability of Socialists to apply our principles and our Marxist analysis to these developments in capitalism. Our historic record is one to be proud of. Only The SPGB has steered a true course, not deviating from our sole purpose - Socialism. That, we claim, is a proud achievement, something to celebrate and to honour. We assert that the founding members of this party built on sound foundations, and we salute them for their clear-sightedness, courage and dedication: we, who walk in their footsteps and who share their vision and their uncompromising principles.
The SPGB will not barter its independence
for promises of reform ...For the party of the working class,
one course alone is open, and that involves unceasing hostility
to all parties, no matter what their plea, that lend their aid
to the administration of the existing social order and thus
contribute, consciously or otherwise, to its maintenance. Our
object is its overthrow. Propaganda, Politics and RevolutionHas Capitalism Triumphed?Never has the capitalist class felt so secure. Never has their wealth and privilege been so great. According to the Institute for Policy Studies, 497 billionaires now have a combined wealth of $1.54 trillion greater than that owned by half the world's population. The capitalist class basks in the sun while their tame academics spread the lie that capitalism has globally triumphed. LSE Professor, Patrick Minford proclaims in his book "MARKETS NOT STAKES - THE TRIUMPH OF CAPITALISM AND THE STAKEHOLDER FALLACY (1998) that the American eagle has spread its free market wings over the six continents of the world. Capitalist triumphalism is for Minford American triumphalism. "USA!: USA!: USA!" bellows the professor throughout the book's 257 pages. He has come a long way since his Maoist student days of the 1960's. The propaganda of 21st century capitalism is the propaganda of triumphalism. It is also the propaganda of a lie. The truth is altogether different. Socialism has not failed because Socialism has never existed. The Socialist revolution has still to take place. There has never been a test of a Socialist majority taking conscious and political action. Nowhere has there ever been common ownership and democratic control of the means of production and distribution by all of society. Adair Turner, Vice Chairman of Merrill Lynch Europe (total client assets: approximately US$1.4 trillion) and a director of a number of media and Internet companies, shares this triumphalism. He, too, propagates the lie that Socialism has been seen off by what he calls "the dynamism of the free market". Mr
Turner is not only a very wealthy capitalist in his own right but
he is also a visiting professor at the London School of Economics;
from 1995 to 1999 he was Director-General of the Confederation of
British Industry and before that a director of McKinsey and Company.
He is also the Chairman of the Low Pay Commission and Chairman of
the Pension Commission. Mr Turner is also a polemicist for the capitalist class. He propagates the interests of the capitalist class. He deeply believes in capitalism. And not without reason. As a capitalist he lives off the unearned income of profit. He lives off the exploitation of the working class who actually produce all the social wealth. The working class are the wealth creators, not the capitalist class. Turner has recently written a book in which he praises capitalism. As a side swipe at Marx he has called his book "JUST CAPITAL". The title is a play on words. Not only is Mr Turner implying that capitalism is "just, equitable and fair" to both the capitalist class and the working class. He is also implying that there is just Capital. All practical alternatives have been seen off. To slightly change a remark once made by the rock musician Frank Zappa, "there is more stupidity in economics than there is hydrogen in the universe". Hired Prize-FightersYou can imagine Mr Turner sitting each day on a mat in his plush London office somewhere in the City arms folded chanting out "there is no alternative". This is Mr Turner's political mantra. With all his faith in capitalism, Mr Turner can never see capitalism as it really is. He is no disinterested scientist but an apologist for the profit system of class exploitation. Capitalist economics long ago gave up being a science. It is now a set of ruling class ideas and beliefs. In
place of disinterested inquirers, there were hired prize-fighters;
in place of genuine scientific research, the bad conscience and the
evil intent of apologetic. JUST CAPITAL contains the usual puff from Turner's devotees. Will Hutton praises it to the hilt, so do Professor Ralf Dahrendorf and Jonathan Porritt. Workers should be wary of radicals from universities who wish to promote themselves as theoretical leaders. Hutton is your typical GUARDIAN contributor, a Utopian dreamer who thinks you can have capitalism without the effects of capitalism. And Professor Dahrendorf has spent an academic lifetime trying and failing to produce a bourgeois theory of class to match Marx's own scientific propositions about class, class interest and class struggle. We do not intend to spend more time on Mr Turner or his book than he deserves. It is pretty poor capitalist propaganda, bearing all the hallmarks of an apologetic, shallow economics tract. The book peddles the vulgar belief that you can have a crisis-free market economy with perfect information, ever-increasing choice for all, harmony of interests between capital and labour, and world peace through the operation of commodity production and exchange for profit. In the real world Marx showed that capitalism is anarchic and crisis-ridden with irresolvable contradictions. Class conflict is built into the very system itself as capitalist production for profit prevents the needs of the world's population from being met. In the real world, away from economic seminars, billions are unemployed. War and conflict is everywhere except in economic text books. Capitalism can only ever be unpleasant, exploitative, violent and destructive. Vietnam: from capitalism to capitalismHowever we will start with Mr Turner's belief that capitalism is everywhere triumphant. He states right at the beginning of the book:
In
November 2000 Bill Clinton visited Vietnam, the country which twenty-five
years earlier had expelled America's military might, and which had
set out to build a communist society. He bought a message of reconciliation
but also a message of confidence in the capitalist model, urging
the Vietnamese to embrace the "force of nature" which
globalization and the market economy appear to represent. He was
well received and not surprisingly. For Vietnam is already integrating
into the global market economy , its exports competing in developed
country markets on the basis of low labour cost, its factories producing
goods for multinational firms, its domestic economy increasingly
organized on market principles. The Vietnamese ruling class did not need any lecture from Mr Clinton or Mr Turner about embracing capitalism. Vietnam had already embraced capitalism, first through a primitive and crude nationalisation programme, and now, increasingly, a capitalism found elsewhere in the world. The first primitive form, state capitalism, was supported by the capitalist Left in the 1960's and 1970's. Remember the likes of Tariq Ali, linking arms with other Trotskyists at London demonstrations, childishly shouting out "Ho- Ho- Ho Chi Min" . Where are the defenders of state capitalism now? Now another form of capitalism in Vietnam is supported by the fundamentalist free-market Right whose equally inane chant is "Free Trade". As regards the interests of the working class, both forms of capitalism are merely two sides of the same exploitative coin. Wherever there is wage labour, there is exploitation. Wherever the capital-labour relationship exists, there is the exercise of class power and class privilege. This is borne out by developments in Vietnam. What is the reality of capitalism in Vietnam? Here is the reality. First, the ASIA TIMES (June 2000) with an article stating that in Vietnam there are:
· Primitive conditions of employment - high levels of accidents
and deaths at work The CAMPAIGN FOR EDUCATION wrote, in their 2000 report, that in Vietnam:
· 12,675 children under 15 years are working in dangerous
and unhealthy conditions usually for multinational corporations. The ANTI LABOUR SWEAT SHOP LEAGUE (January 2004) stated that:
Any
organization put together by the workers will be immediately destroyed
at once. These people are basically slaves, they are scared into
staying, they are paid very, very low wages or nothing at all, and
are denied basic benefits and worker's rights
So there we have it, capitalist propaganda and the reality: the myth of the "best of all possible worlds" on the one hand, and the contrasting reality of profit, exploitation and human misery. Mr Turner is, of course, not interested in the repression of free trade unions, the low pay, exploitation, the use of child labour, the sweat shops, and political dictatorship. The last thing he would want to see is a genuine Socialist Party in Vietnam advocating the abolition of the wages system. He only sees potential markets and cheap labour to exploit. We
can also look at capitalism in Vietnam from a Marxist perspective.
Marx showed that sellers of commodities can never know whether they
will find a buyer in the market. If the time period is too great,
an economic crisis will occur with bankruptcy and unemployment the
consequence. This is the anarchy of capitalist production.
All contradictions of bourgeois production collectively come into
eruption in the general crises on the world market. At present there is an economic crisis in coffee production (INDEPENDENT 4 April 2004). The price of coffee has collapsed around the world. Ironically, during the early 1990's, Vietnam was encouraged by the World Bank to grow coffee. A huge increase in production of Vietnamese coffee took place. In the 1980's, Vietnam was 42nd ranked commodity producer in coffee on the world market (so much for the lie that Vietnam was Socialist/Communist). But by 2001, Vietnam produced about 15 million bags making it the second largest producer of coffee worldwide. Vietnam's coffee producers glutted the market. There are more sellers of coffee than buyers. The Vietnamese coffee farmers are now having to sell their coffee at only 60% of the cost of production and repay loans taken out in the misguided belief that there would be a market for their coffee. Anthony Wild, a commentator on coffee production recently wrote:
Vietnamese
coffee production, having boomed, is now falling rapidly as it is
realised that the promised riches are chimerical. The larger cost,
to the fragile highland environment, to its beleaguered wildlife,
to the displaced indigenes, and to the migrant lowlanders left stranded
without an income and deep in debt is incalculable. Living in the Real WorldWhose
analysis of capitalism is more penetrating, scientific and correct
- Marx's or Turner's? Turner believes that the capitalist market is
perfect. Marx showed it to be anarchic, unpredictable and destructive.
Who describes the real world, Turner or Marx? Did Turner anticipate
the current crisis in the coffee market with the resultant bankruptcy
and unemployment in Vietnam? Marx showed that capitalism passes from
one economic crisis to another. Marx had a scientific understanding
of and insight into capitalist production for profit and its laws
that has never been surpassed. Certainly not by such as Mr Turner. Then
there is the question of capital. Like all economists, Turner makes
the error of depicting capital as a "thing". Capital,
is in fact, a social relationship - a class relationship between workers,
capitalists and the means of production. A Negro is a Negro. He only becomes a slave in certain relations. A cotton-spinning jenny is a machine for spinning cotton. It becomes capital only in certain relations. Torn from these relationships it is no more capital than gold is money or sugar the price of sugar... Capital is a social relation of production. It is a bourgeois production relation, a production relation of bourgeois society.
Abolish the social relationship between capital and labour, abolish
the wages system, and human labour-power ceases to be a commodity,
ceases to be variable capital. The same applies to raw resources and
other means of production. The means of production are only "constant
capital" under capitalism. Abolish capitalism and establish
socialism, and the means of production will be owned in common. Turner's
propaganda is wrong in another important respect. Russia and China
have always traded on the world market. They have always been part
of world capitalism. State capitalist countries have not been immune
from capitalism's laws and contradictions. The labour theory of value holds good wherever wage labour is exploited in the productive process. And it is a misnomer to refer to China and Russia as "Communist". You can label a bottle of whitewash "milk". But when you come to drink it, the content still tastes of whitewash. This applies as much to Vietnamese capitalism masquerading as "Communism" as it does to books published with the "Triumph of Capitalism" printed on their cover.
The
Legacy of War An
estimated 5,700 tons, or 12 million gallons of Agent Orange
were sprayed on South Vietnam during the war, destroying as
much as 14 per cent of the forest cover and 50% of the mangrove
swamp that had previously been a valuable source of lumber.
Over 4.5 million acres of vegetation were wiped out, with devastating
results for the wildlife and the ecology, let alone any unfortunate
Vietnamese who found themselves in the flight path of the sprayers.
Inevitably farms and smallholdings were also sprayed, causing
widespread poverty and starvation. It was 10 years before crops
could again be grown on affected land.. The health costs are
still not fully understood, but about 400,000 deaths and serious
cases of illness, and a further 500,000 birth defects in Vietnam
have been attributed to the agent. Some inventors chase the dream of a perpetual motion machine. Others seek a formula for predicting the ups and downs of stock markets and foreign exchange markets. Contrary to the simple belief of the Adam Smith school of economics, "as the effectiveness of one trader's actions depends on what all the others do, rationality is an unreliable guide". So devising a successful prediction model means simply picking up on "patterns in past price movements and [using] them to predict the future". Easier said than done - given that these markets are often afflicted by "mass panics, waves of euphoria, and other collective movements" (NEW SCIENTIST, 10 April 2004). Remember the hedge fund, LTCM, based on a mathematical model supposed to ensure profits? An utter disaster. Punters would have been better sticking to the horses or the Lottery! His Master's VoiceSocialists are often asked why we spend so much time on the question of inflation. We would spend less time on this particularly dull subject were it not for politicians, economists and journalists blaming workers for inflation. A recent example of the fallacious assertion that workers cause inflation can be seen in the smug and witless column by Anthony Hilton (EVENING STANDARD, 8.07.02). He tried to draw a parallel with the 1970's when public sector unions were on strike, there was rising inflation, and there was a trade depression with high unemployment. In his column, "Public sector pay and the spectre of stagflation", Hilton based his case on statistics from the investment bank Schroeder Salomon Smith Barney, whose understanding of inflation was equal to Hilton's own economic illiteracy. Hilton claimed that 'inflation' was evident in the private sector, concluding that "Historically, wage rises in the public sector filter out into the private sector and lead to a parallel surge of inflation there". They do no such thing. Inflation is not caused by workers struggling for higher wage rises. Even some economists admit this. In his article "WAGES, INFLATION AND RESERVE BANK MYTHS, the economist Gerard Jackson stated that "there is absolutely no support in history for the view that inflation can ever be the function of wage growth" (BROOKES NEWS, 23 April 2003). Inflation is caused by governments, year after year, printing and putting into circulation hundreds of millions of pounds of excess paper money. Other
things being equal, wherever and whenever currency has been issued
in excess, the price level has risen, and wherever and whenever currency
has been restricted, prices have stabilised or fallen. In the period
1920-22, the printing presses of the German central bank were busy
day and night pouring out notes, and prices were rocketing upwards.
In Britain in the same three-year period the Government had decided
to halt inflation, the note issue was restricted, and prices were
falling fast. The reason there was no inflation in Britain, in the century before 1914, was that through the operation of the gold standard the note issue was controlled. Beyond a fixed low limit the Bank of England could not issue additional notes without adding an equivalent amount of gold to the reserve in its vaults. Also the notes, by law, were freely convertible into a fixed amount of gold - one pound being fixed at about a quarter of an ounce of gold. Gold coins and Bank of England notes both circulated but, because of legally enforced convertibility, a Bank of England note was "as good as gold", and the combined circulation of notes and gold coins was proportionate to the total amount of gold in the reserves. Marx showed why, if the total amount of gold is replaced by inconvertible paper money, and if the amount of that paper money is then issued in excess, prices are pushed up accordingly: If
the quantity of paper money issued is, for instance, double what it
ought to be, then in actual fact one pound has become the money name
of about one-eighth of an ounce of gold instead of about one quarter
of an ounce
The values previously expressed by the price £1
will now be expressed by the price £2. Governments since 1938 have followed a policy of continually increasing the amount of currency in circulation, from under £500 million in 1938 to over £39,000 million in January 2004 (Bank of England: Monetary & Financial Statistics March 2004). In 1977 the note issue was £7,000 million, an increase at the time far beyond any increase that would have been necessary because of expansion of total production and trade. In 1976 and 1977, when the government claimed that its 'wages and incomes policy' would curb inflation, the flood of additional paper money went on without interruption. The
man, more than any other, who was responsible for abandoning the nineteenth-century
policy of controlling the amount of paper money was J M Keynes, who
declared that it was no longer necessary "to watch and control
the creation of currency". So for 40 years the major British political parties and the trade unions were misled by the Keynesian policy of inflation into believing that capitalism could be rid of unemployment and trade depressions. The simultaneous existence of both inflation and an economic depression in the late 1970's destroyed Keynesian economic credibility. 'Wage inflation' is an economic myth. When inflation increases through government policy, workers are compelled to struggle for higher wages otherwise their real incomes would fall as they did under the Callaghan government of the 1970's. What of those economists and journalists who peddle the lie that workers cause inflation? Most have been uncritically taught this economic nonsense when they were students and know no better. It is economic orthodoxy in text books. Marx's work on the subject is a closed book to them. We waited a year to look again at Mr Hilton's prediction. He was hopelessly wrong. The rate of inflation did not increase as he claimed it would. In fact inflation stayed about the same at under 2% (NATIONAL STATISTICS; Consumer Price Index, January 2002 to July 2003). His piece of journalism was aimed squarely at attacking the working class. That is what he is paid for. Journalists like Mr Hilton are bought men and women. Marx called them "prize-fighters". They produce and reproduce ruling class ideas for a living. The phrase intellectual prostitution comes to mind. Socialists are bought by no one. We stand on our own two feet and tell the truth. Capitalism, whether with inflation, a stable currency or deflation, can never be made to work in the interests of the working class. However, when capitalism goes wrong, as it invariably does, or when workers try to struggle for increases in pay, capitalist politicians will waste no time in either blaming workers or attempting to split the working class by pitting one group of workers against another. Of Greed and Need Alan
Greenspan: "An infectious greed seemed to grip much
of our business community"( testimony to the Senate
Banking Committee, 16 July 2002) The Clapham Party's Cover-UpIt is now over a year since the Clapham-based Socialist Party were officially informed that the World Socialist Party (India) had decided that they would recognise The SPGB and sever links with the Clapham Party. The WSP (I) made their decision after lengthy consideration at their Conference (21-23 February 2003) and notified the Clapham party shortly after. Months later, the WSP (I) were surprised to find their party's details were still listed in the Clapham party's journal, the Socialist Standard, and on Internet websites controlled by the Clapham party. In May 2003 they protested to the Clapham party: The Ninth Annual Conference (February 21 - 23, 2003) of the World Socialist Party (India) has severed the Party's companionship with the Socialist Party (Clapham) by withdrawing its misplaced recognition of them, while recognizing The SPGB, 71 Ashbourne Court, Woodside Park Road, London N12 8SB as the genuine The SPGB. Thus, the WSP (India) is no longer a Companion Party of the so-called World Socialist Movement. By now, therefore, its name should have been deleted from both the WSM listings in the Socialist Standard and the Website. But it is yet to be done. Well, it should not linger over [ this] any longer.
The
Clapham Party's General Secretary replied (24 June 2003): Subject: Re: To delete WSP (INDIA) from the WSM listings: On the matter of your email below, you are correct - the contact details of your organisation will not appear in the next issue of the Socialist Standard (July 2003), and when the comrade who helps maintain the website is back from holiday at the end of this month I will contact him to request that your organisation's details are removed as an affiliate of the WSM. A misleading statement appeared, belatedly, in the Socialist Standard (October 2003): In
April a 15-page circular emanating from the E-mail address of the
World Socialist Party (India) was sent to various people including
ourselves. It contained various allegations against The SPGB and other parties of the World Socialist Movement,
all based on the conspiracy theory that with end of the post-war boom
in the early 1970s and the revolutionary possibilities this supposedly
opened up, pro-capitalist elements had been infiltrated into The SPGB
with the aim of diverting the working-class, particularly in the non-European
World, from learning about real socialism. But why did they wait from May to September to take the WSP(I)'s details from the listing in their journal? Their claim that they had not received a reply from the WSP(I) has to be set alongside the fact that many of their members flatly refused to enter into correspondence with the WSP(I), to answer the WSP(I)'s Critique, and, abusively, even demanded not to hear from them again. The brush-off is Clapham's usual way of dealing with those who refuse to support them. Clapham's practice goes counter to The SPGB's openness to debate. You cannot convince your opponents that you have a strong case by hiding your head in the sand and hoping they will fade away. That is the behaviour of those who know their case is weak. The Clapham party's other method is to try to discredit opponents by smear tactics, an old Leftwing ploy. They like to claim the moral high ground, asserting that they, and they alone, are truly democratic. In a recent statement, the WSP (India) commented: As
things stand, their so-called 'detailed and reasoned reply' had from
the start been well dealt with, and sufficiently evidenced, in the
CRITIQUE and subsequent replies to the many subterfuges from their
followers. Theirs were mere face saving operations to tactfully avoid
the WSP (India)'s exposure of their monstrous distortions, lies and
slanders ... And on 31 October 2003 Comrade John Thompson from Canada in his resignation letter confirmed: "The
SP and their baby, the WSM, [are] autocratically maintained and edited
by a small committee in the SP and allowing membership who do not
understand the socialist case
I am opposed to the WSM. There
is a racial promotion in the WSM as well. That is with the recent
introduction of a Socialist Standard sized publication called the
African Socialist. Socialism is a worldwide concept and depends on
workers of the world uniting in emancipation from wage slavery. Socialists
do not promote socialism by continental congress!" The Clapham people speak in many voices to hide folders of facts behind folders of fiction. And that's their unique 'conception of internal party democracy', no doubt! But what ex-insiders have gathered from the facts is that the WSM is the name of a small Clapham committee's opportunistic game. Who knows who concludes what, when and under what circumstances? And the so-called companion parties of the WSM are in no position to question why, but to hold those fictions high! And that's their 'sound democratic basis', maybe!" The Clapham party's attempt to conceal the facts was a shabby attempt to deny workers information. That the Clapham party clearly prefers to conceal such matters is a measure of how far the people who run that Party and the WSM have deviated from any principle of democratic organisation. Ironically, the Clapham party's belated admission that the WSP (India) had left the WSM fold actually represents a small step forward towards something like openness. Maybe they should be congratulated. After all, when did they get round to admitting to their own members and readers of the Socialist Standard the facts about the 1991 expulsions which led, predictably, to the establishment of the reconstituted The SPGB? Parliament or Direct Action?In this day and age the idea of Black Rod solemnly knocking on the door of the House of Commons so that the Queen can go in and read a speech that has been written for her by the government is a piece of nonsense that accords well with the rest of bourgeois tradition. What we see in parliament today is a mockery of democracy. The chamber of the House of Commons rarely has 10 per cent of its 659 members present. There are probably more MPs propping up the commons bar at any given time than there are present in the chamber. When the Prime Minister and the leader of the opposition are present and due to address the House, only then is it filled to capacity. The spectacle is one where the front-bench leaders do most of the speaking and the rest jeer and cheer, like a lot of unruly children. There are jibes and counter-jibes, and cheap point-scoring is the game of the day. Order papers are waved wildly but substance and reasoned argument, for the most part, are sadly lacking. The political confusion and leadership fetishism inside parliament reflect those same conditions existing in the world at large outside. In the absence of a Socialist working class electorate, parliament can only be used by reformist politicians to run capitalism. It must be remembered that this state of affairs exists because workers are deluded enough to vote for it. It is utterly absurd to believe that anything can be done about Socialism, inside or outside of parliament, without a majority of workers understanding and wanting it. To regard politics and parliament as uniquely corrupt is a mistake. All the fraud and lying, the extremes of riches and poverty, militarism and conflict, are the normality of capitalism. It is wrong to imagine the institutions of a system built on exploitation as capable of being other than a reflection of the rivalry and the promotion of capitalist class interests which characterise the system as a whole. The warped ideology of nationalism and religion wrapped up in monetary relations permeates the entire edifice of capitalism.
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