Monday, December 26, 2011

St Paul

People are attracted to Ron Paul as a candidate who is against war, for drug legalization, hands off the internet, etc. and then they swallow the pill and think they hold the key to 'righting' the economy with his gold standard ideas. Why are so many leftists offering sympathy to Ron Paul , a free-market capitalist, right-wing pseudo-libertarian? The ONLY things they have in common is some degree of anti-government sentiment and an anti-war position. Opposition to the state might sound pretty good, but the Libertarian anti-state position is based on a blind faith in the free market. They argue that the benevolent forces of the market economy are curbed by the centralised power of the state, which results in a curtailment of individual liberty. Libertarianism states that it shall be legal for anyone to do anything he wants, provided only that he not initiate (or threaten) violence against the person or legitimately owned property of another. That is, in the free society, one has the right to manufacture, buy or sell any good or service at any mutually agreeable terms. Thus, there would be no victimless crime prohibitions, price controls, government regulation of the economy. If libertarians are serious about liberty, and truly want to live under a state-less system where peace then they must end capitalism, whose invisible hand has been slapping all of us around and pushing us to slay each other.

Today in the United States, Ron Paul seeks to abolish what little services the state still provides for its poor, hungry, and dispossessed. These services were paid for in sweat and blood by activists who aimed to alleviate the stress and misery of poverty for the American working class. Although against reformism we cannot deny the reality that certain reforms such as an eight-hour work-day or welfare assistance help those who cannot endure the nature of our survival-of-the-fittest capitalist state. Social and welfare services which have been forced upon the elite and conceded to the working class during the New Deal and the Great Society, amongst other epochs cannot be written off as unimportant. Militant labour fought for concessions. Poor people now have social programs. Ron Paul's visions are nothing more than the resurrected dreams of robber barons past. He may be against state authority, but it is inconsistent to oppose tyranny in the public sphere of government and leave it unaddressed in the private sphere of work. It is to simply trade one slavemaster for another.

The logic goes something like this: Free-market capitalism on its own would naturally lead to a world of personal freedom and economic prosperity, but this is thwarted by the power of the state, an organism that grows robustly at times of war. Hence, war must be opposed not only because of its own obvious evils, but as a way to drive back the power of the state which is standing in the way of a better life. For Libertarians capitalism is an inherently peaceful system. They ridicule the idea that there is a connection between the nature of capitalism and the wars that constantly break out under it. In the Libertarian’s mind, capitalism is—or should be—a world made up of enterprising capitalists, minding their own business(es) and interacting peacefully, without any need for the state to intervene in these affairs or for wars to be waged overseas. Here we are basically dealing with the viewpoint of the individual capitalist, particularly the small-scale one, who experiences the state as an unpleasant institution that appropriates his hard-earned wealth through taxation, sometimes to pay for wars that bring him no direct benefit. Remove this alien force, he reasons, and life would immediately be much rosier. The “liberty” that Libertarians wax so philosophical about is the freedom of this economic actor to chase after his profit in peace. Ron Paul feels that capitalism can somehow behave more rationally than it does. This Libertarian view of the benevolent nature of a market economy is a selective one. Their focus is on exchange, as a mutually beneficial act. This is a real “win-win” situation, where I give you my widget and get your gadget in return. The reality is quite the opposite. What is left out, however, are some of the strikingly war-like aspects of a capitalist economy, starting first and foremost with the cut-throat competition that goes on in the pursuit of profit. Nor do they dwell on the class divisions inherent to such a system and the conflict that that results. Never minding the fact that profits are squeezed out of workers, thus depriving them of their own personal liberty!

The state and the wars it wages may seem a complete waste of taxpayer money to the individual capitalist (and to the Libertarian who translates his blinkered viewpoint into a grand philosophy), but things look a bit different if we consider the capitalist class as a whole. Like any ruling class throughout history, the minority capitalist class needs the state, as an apparatus of coercion, to maintain its grip on power. And in addition to this age-old function of the state, a capitalist state is also necessary as a means of coordinating the diverse interests of individual capitalists in order to represent their collective interests as capitalists. The example of banking alone shows how deregulation may benefit a tiny stratum of capitalists at the expense of their bourgeois brethren who have to purchase exorbitant or shoddy products. Given this twin-necessity for the state—as policeman and mediating judge—the more far-sighted or financially more comfortable capitalists view the taxes directed to the state apparatus as money well spent. Libertarians, in short, loathe the state without understanding why it must exist and play certain roles under their cherished capitalist system.

And the same shallowness characterizes their view of war, which is fervently opposed without an understanding of its root causes. Tensions between nations are always present over shifts in political allegiances between countries that may benefit some better than others. Global politics is a macrocosm of the local economy, with each company vying to get as much of the business as it can, such as trade, material resources and opportunities for future economic growth. Capitalism, as already noted, generates its own war-like behaviour at home, where capitalists will go to any lengths to vanquish the enemy (i.e. competitors). We may find this behaviour deplorable from the standpoint of human decency, but it does have its own necessity. And there is a similar capitalist logic at play when nation-states jostle and throttle each other for access to markets and resources, despite such behaviour being the height of idiocy from the perspective of humanity as a whole.

Noam Chomsky has said of Ron Paul "He is proposing a form of ultra-nationalism, in which we are concerned solely with our preserving our own wealth and extraordinary advantages..."

Ron Paul wants to abolish "The Fed", the Federal Reserve, America's central bank, a critic of “fractional reserve banking” , as well as an advocate of a return to a gold-backed currency. If Paul had his way, the Fed would no longer manage the issue of the currency. This would pass to the Treasury Department which would only be allowed to issue paper money if it had the equivalent value of gold in Fort Knox. This would be a further absurd waste of resources as much more gold would have to be mined – just to store in places like Fort Knox. Paul thinks that a return to a gold-based currency would eliminate crises such as in the 1930s and today. This is an illusion. There was a gold-based currency up until WWI, yet crises occurred regularly, including a Great Depression in the 1880s and a hundred years ago the same sort of banking crises as today. Capitalism goes through its boom/slump cycle whatever the currency. No monetary reform can change that.

Money originated as a commodity, i.e. something produced by labour that had its own value, which evolved to be the commodity that could be exchanged for any other commodity in amounts equal to the value of the other commodity. Various things have served as the money-commodity, but in the end gold (and silver) was almost universally adopted. Being rare (i.e. requiring more labour to find and extract from nature, so concentrating much value in a small amount), and it was divisible and so easily coined as well as long lasting. As capitalism developed it was found that gold itself did not have to circulate, but that paper notes could substitute for it as long as those accepting or holding it could be sure that they could always change them for gold. Up until WWI in most countries the currency was gold coins and paper notes convertible into gold. The Great Depression of the 1930s led to the major capitalist countries abandoning this convertibility. Since then the currency nearly everywhere has been inconvertible paper notes. With an inconvertible paper currency, the amount of money is no longer fixed automatically by the level of economic transactions, nor is there any limit to the amount of paper currency that can be issued. It is this that Paul objects to because, if the central bank issues more paper money than the amount of gold that would otherwise be needed, then the result will be a depreciation of the currency; the paper money will come to represent a smaller amount of gold with the result that prices generally will rise.

The gold standard was put into effect in the U.S. after the American Civil War. The gold standard in the U.S. was implemented due to demands from Wall Street financiers. they had financed the Union Army based on paper money. They wanted to be able to redeem the debt in dollars worth more than what they provided by tying the dollar to gold, and this would cause deflation, thus raising the value of their dollar-denominated debt. But the effect of this was to restrict growth in the money supply which was to drive down farm commodity prices, impoverishing farmers and driving a huge number of people off the land. That was because, as productivity in agriculture and industry in the U.S. grew in the late 19th century and early 20th century, growth in the money supply didn't follow suit. This led to a constant deflationary tendency. as farmers could get less and less per unit of output, they were unable to pay their debts.

In that era credit in general was extremely scarce. for example, until after World War II, it was hard to get house mortgages in the U.S. Typically you could only get a mortgage for a short period. Consumer credit only really developed in the '20s. This is relevant to the issue of the money supply because expansion of credit expands the money supply. Individualist Anarchists in the US in the 19th century spent a lot of time attacking the gold standard as it allowed the banks to charge extremely high interest as it restricted the money supply. Of course, in practice, banks used lots of techniques to increase the supply to make more profits, of course, but it was a key means of restricting working class access to capital -- which was essential to proletarianise a mostly artisan/peasant (i.e., pre-capitalist) society.

Nor was the deflationary effect necessarily a good thing for workers in the late 19th century. Falling commodity prices meant that employers also were under pressure to cut wages, which they did. It was wage-cutting that provoked the Great Rebellion, the railway strike, of 1877. Recessions/depressions tend to reduce worker bargaining power, and the late 19th century was subject to continual recessionary tendencies, with a big depression in the 1870s and again in the 1890s.

In reality there is no particular reason to tie money to gold. The right-libertarian types such as Ron Paul like gold because the idea is to have control of the money supply independent of the state. Paul cannot be called a currency crank as he has a correct understanding of what causes inflation and his solution would work to stop it, if that what was wanted, even if it would be unnecessary, pointless and a waste of resources.

Ron Paul is not our friend. He is not our ally. He is not fighting for us. If our goal is the eradication of capitalism, then supporting Ron Paul is just completely delusional.

Monday, December 19, 2011

Re-defining the rat race

Rats display human-like empathy and will unselfishly go to the aid of a distressed fellow rodent, research has shown. Rats opened a door to free trapped cage-mates. No reward was needed. There was no other reason to take this action, except to terminate the distress of the trapped rats. Rats still prioritised their cage-mates when offered the option of ''freeing'' chocolate chips. They could been lured away by the distraction and have eaten the entire chocolate stash if they wanted to, and they did not.

http://www.telegraph.co.uk/science/science-news/8943567/Rats-display-human-like-empathy-and-will-help-rodents-in-distress.html

In 1925 the French anthropologist Marcel Mauss in “The Gift,” argued that contrary to the textbook account of primitive man merrily trading beaver pelts for wampum, no society was ever based on barter. The dominant practice for thousands of years was instead voluntary gift-giving, which created a binding sense of obligation between potentially hostile groups. To give a gift was not an act based on calculation, but on the refusal to calculate. In the societies Mauss studied most closely — the Maori of New Zealand, the Haida of the Pacific Northwest — people rejected the principles of economic self-interest in favor of arrangements where everyone was perpetually indebted to someone else.

David Graeber argues those once-prevalent relationships based on an incalculable sense of duty deteriorated as buying and selling became the basis of society and as money, previously a marker of favors owed, became valuable in its own right. Graeber’s point is that we ended up enslaving ourselves by thinking of ourselves as fully autonomous. As anyone who works a 9-to-5 job knows, the “right” to sell one’s labor hardly feels like privilege. Graeber thinks it’s a mistake when unions ask for higher wages when they should go back to picketing for fewer working hours.

http://www.nytimes.com/2011/12/11/books/review/anarchist-anthropology.html?pagewanted=2&_r=1&nl=books&emc=booksupdateemb3

Monday, December 12, 2011

Trust in God?

Religious believers distrust atheists more than members of other religious groups, gays and feminists, according to a new study by University of B.C. researchers. The only group the study's participants distrusted as much as atheists was rapists.

"People are willing to hire an atheist for a job that is perceived as low-trust, for instance as a waitress," said Will Gervais, lead author of the study. "But when hiring for a high-trust job like daycare worker, they were like, nope, not going to hire an atheist for that job." The antipathy does not seem to run both ways, though. Atheists are indifferent to religious belief when it comes to deciding who is trustworthy. "Atheists don't necessarily favour other atheists over Christians or anyone else," he said. "They seem to think that religion is not an important signal for who you can trust."

And in the Bible we read:-

" Samaria shall become desolate; for she hath rebelled against her God: they shall fall by the sword: their infants shall be dashed in pieces, and their women with child shall be ripped up. Now therefore kill every male among the little ones, and kill every woman that hath known man by lying with him. But all the women children, that have not known a man by lying with him, keep alive for yourselves. Now go and smite Amalek, and utterly destroy all that they have, and spare them not; but slay both man and woman, infant and suckling"


God exacting his revenge on pregnant women and infants. Hebrew soldiers killing all the non-virgin women and raping the others.

And who should we trust, the believer or unbeliever?

Wednesday, December 07, 2011

reforms change little

Eugene Debs once said, “Its better to ask for what you want and not get it, than ask for what you don’t want and get it.” If you really want socialism, join the World Socialist Movement. Ask for what you do want.

After over a century of reform activity, and the sincere efforts of a multitude of reformers, the world is in a greater mess than ever it was. We socialists are often accused of being opposed to reforms, social legislation designed to ameliorate some intolerable situation. Not so. We of the World Socialist Movement are not opposed to reforms per se, any more than we advocate them. The really vital reforms of capitalism were won a long time ago, for instance, the vote that gave the working class the opportunity to take its fate into its own hands.The position of a revolutionary is to reject reformism - the advocacy of reforms - which is not the same thing as opposing reforms themselves. Reformism is the promotion of reforms and it is this that we revolutionaries should not be engaged in. Trying to mend capitalism is incompatible with trying to end capitalism. For ourselves, radicalisation entails the conscious propagandisation of the communist alternative under each and every circumstance thrown up by capitalism. It an interactive process between thought and practice driven by a clear and unambigous conception of what we are to replace capitalism with. Nothing less will do. Unless we know what to replace capitalism with, capitalism will not be replaced. We will be stuck with it. It is literally a case of one or the other

We make a very clear distinction between reformist struggle and other forms of struggle. We are 100 % behind militant industrial struggle. fully support militant struggle by workers as a class and as individuals in the economic domain to resist the downward pressures of capital. In fact, in our view, the trade union movement has largely compromised and weakened itself by blurring this distinction as for example in the UK where many unions are affiliated to the capitalist Labour Party. Trade unions should stick to the economic domain where they work much better as militant organisations of the working class. Reformist struggles are qualitatively different in kind to industrial struggle since they are of a political nature and seek to impact on the way capitalism is administered in terms of policies. What those who are essentially advocating is reformism in the belief that it entails some kind of progressive dynamic which will lead us somewhere closer to achieving a socialist society. In fact all the historical evdience shows that your progressive changes lead to the abandonment of revolutionary socialism and the co-option of erstwhile revolutionary socialists into capitalism In any case it is nonsense to suggest that revolutionary socialism means "standing outside of the political process". This a terribly mechanical not to say narrow minded, concept of what the political process actually is.

Nor can we automatically assume that crises help to radicalise workers. In fact, there is strong empirical evidence to the contrary some, recent studies show that a crisis tends to make some workers more fearful of the future, more conservative and more conformist even though it might well radicalise others. One must never forget the lessons of pre-war Germany and the depression which helped to fuel the growth of the Nazi movement. Revolutions are not simply the result of social crises and class struggle, they are mediated by consciousness. The ideas themselves don't stand alone but are drawn from the class struggle and in turn recipriocally influence the struggle. Its a two way interactive process not a one way street. As far as a communist revolution is concerned while we may not know what shape the working class is in when it happens we do know that a significant majority must understand and want communism in order for a communist revolution to happen. Communism absolutely neccessitates conscious majority support and therefore a revolutiuon which does not have this conscious majority support will not be a communist revolution becuase the outcome will not be communism. The revolution is effected by the communist minded working class seizing power and declaring capitalism null and void. This is fully consistent, with the point about the seizure of political power by the proletariat being the precondition for the "historical process of revolutionary change". But in order for the proletariat to seize power and effect a revolutionary change it has to be substantially communist-minded in the first place. This is absolutely essential and is integral to the Marxian perspective. Engels points this out in the introduction to Marx's Class struggles in France "Where it is a question of a complete transformation of the social organization, the masses themselves must also be in it, must themselves already have grasped what is at stake, what they are going in for [with body and soul]."

Of course, socialist consciousness comes through struggle not just propagandising. This is not an either/or situation. It is actually mutually reinforcing. The struggle gives rise to the ideas and the ideas in turn help to clarify and strengthen the stuggle. Part of my argument against reformism is that it actually weakens the position of workers. It doesnt radicalise them at all. It ties them politically to capitalism via capitalist political parties that aim to garner support through the advocacy of reforms. This is what workers need to reject. They will actually become much more militant in my view if they completely rejected the refromist illusion that capitalism can be moulded to accommodate their interests and if they came to regonise that the interests of workers are diametrically opposed to the capitalists. This is what revolutionaries should be doing - saying how it actually is not trying to dishonestly socially engineer workers into coming over to them by dangling reforms in front of them which they know full well are not going to modify the position of the exploited class. In the end if you do not break with the logic of capital completely and in ideological terms, if you do not explicitly advocate a genuine alternative to capitalism, there is no way on earth that you will ever create an alternative to capitalism. You will remain forever stuck in the reformist treadmill going nowhere. Although the ultimate aim of the radical fighting for a reform may be the self emancipation of the working class, it will never ever come to self emancipation of the working class precisely because fighting for reforms is a trap fromn which you will never ever escape unless you stop fighting for reforms and raise your sights higher. Capitalism cannot be reformed in the interests of workjers so fighting for reforms in the interests of the workers is fordoomed. It is simply a treadmill which will never lead on to anything else. "Radicalisation" is the result of an interaction between material struggles - workers organising on the industrial and social terrain - and communist ideas. Above all it involves the explicit and conscious embrace of the communist goal - a non market non statist alternative to capitalism. This is what truly constitutes radical in the sense of a root change.

There is no real evidence that it does lead to a communist outlook. Many radicals ultimately end up in in the ghetto of worthy liberal causes which only serve to fragment working class solidarity in plethora of separate struggles each demanding attention at the expense of others . Or they become disillusoned old cynics in later life and join the establishment. We dont say socialists need to stand on the sidelines and tell workers to drop their illusions and follow us. Firstly we reject the whole principle of vanguardism and leadership. Secondly we dont say we should stand on the sidelines. No revolutionary ever is on the sidelines anyway. This is a meaningless way of looking at this anyway. We are all involved in the class struggle whether we like or not or whether we are aware oif it or not. As workers we will join with our fellow workers in a union to fight the bosses in the indistrial field. We are simply members of the working class who has come to communist conclusions. We dont exist in some sense outside of the working class telling the working class what to do. This is an elitist leninist perspective which we abjure. As communist workers we will therefore put across communist ideas - about communism, about rejecting nationalism, racism and sexisim and so on and so forth. Speading ideas is essential. Everybody without exception believes their ideas are the right ones - otherwise they would not hold or expression them. Its got nothing to do with "leadership". Its what human beings do - talk, discuss , argue. If it is elitist in and of itself to express an idea then what you are trying to say is that we really should not express ideas at all . We should keep mum about our political vierws. That is quite absurd. If everyone followed that adviice there would be discussion about anything. People do develops their ideas as a result of hearing other ideas. This is not "idealist". Materialism does not deny the role of ideas, what it denies is the "independent" role of ideas, that social developments are completely explicable in terms of the impact of ideas alone. This is false but nevertheless it is quite true that all social developments involve an exchange of ideas between historical actors and could not happen without that.

Radicals talk of the need to have the ear and confidence of the working class. They want to say to workers "yeah, great carry on with your reformist struggles. We're with you all the all way" even though in their heart of hearts they know that this is a recipe for failure. This is not honest and dishonesty does not pay in the end. It is far better to say what you really think and feel to be the case however unpopular or out of touch it might might make you seem at the time. Workers wilkl not thank you for trying to lead them up the garden path and you will certainly not gain their confidence as a result. You stand to lose their confidence completely and this is in fact the story of the Left in general. It has marginalised itself precisely becuase of its opportunistic relationship with the working class.

Some on the Left have a kind of festishised view of "action" that there is something latent or inherent in the acts one carries out that somehow drives one forward into becoming a communist. This is wrong. Strikes, protests demonstartions and all these sorts of activities dont carry any necessary communist implications whatsoever. It is the interaction of ideas and actions which is what is needed. This is the point Im trying to make about radicalisation. If you ignore the importance of ideas and the necessity for a clear and explicit alternative to capitalism you will never ever pose a serious threat to capitalism. Never. Reformist struggle does not necessarily imply a passive working class. This is the point. Workers can be actively engaged in reformist struggles to get governements to introduce measures that they perceive to be in their economic interests. But in the end they actually help to weaken not strenthgthen the working class by tying it ideologically to capitalism, fostering the illusion that capitalism can be run in the interests of workers and entrenching their dependence on capitalist governments to do it for them.

Tuesday, December 06, 2011

political integrity

One of the more over-looked elements of the Sheridan farce is the question of political party democracy. Secret minutes of EC meetings . Star Chamber interrogations.

The SPGB minutes of EC meetings are posted on our website for all to see. EC meetings themselves open to the public.

THAT IS our commitment to party democracy .
THAT IS one of our methods for maintaining membership control of our party .
THAT IS the lesson of the Tommy Sheridan court case .

Monday, December 05, 2011

food facts

At present, the total quantity of food that is produced globally is good enough to meet the daily needs of 11.5 billion people. If every individual were to get his daily food requirement as per the WHO norms, there would be abundant food supplies. In terms of calories, against the average per capita requirement of 2,300, what is available is a little more than 4,500 calories.

An average American consumes about 125 kg of meat, including 46 kg of poultry meat. While the Indians are still lagging behind, the Chinese are fast catching up with the American lifestyle. The Chinese consume about 70 kg of meat on average each year, inclusive of 8.7 kg of poultry meat. The Indian average is around 3.5 kg of meat, much of it (2.1 kg) coming from poultry. If you put all this together, the Chinese are the biggest meat eaters, and for obvious reasons - devouring close to 100 million tonnes every year. America is not far behind, consuming about 35 million tonnes of meat in a year. Six times more grain is required to provide the proteins that are consumed by the meat-eaters. Americans throw away as much as 30 percent of their food.

The 1996 World Food Summit, political leaders pledged to pull out half the world's hungry (at that time the figure was somewhere around 840 million) by the years 2015. In other words, by 2010, the world should have removed at least 300 million people from the hunger list. Instead it has added another 85 million to raise the hunger tally to 925 million. Considering FAO's projections of the number of people succumbing to hunger and malnutrition at around 24,000 a day, it is estimated that by the year 2015, the 20 years time limit that World Food Summit had decided to work on to pull out half the hungry, 172 million people would die of hunger.

http://devinder-sharma.blogspot.com/2011/11/world-produces-enough-food-for-year.html

Saturday, December 03, 2011

working hours

The fight to discipline peasants into proletarians is indeed interesting. One of capitalism's myths is that it has reduced human toil yet Bushmen work two-and-a-half days per week and on average the working day was less than five hours.

In the Middle Ages hours of work was tied to the seasons and the number of holidays and fairs were many. Work was intermittent - called to a halt for breakfast, lunch, the customary afternoon nap, and dinner with also mid-morning and mid-afternoon refreshment breaks. The medieval workday was probably not more than eight hours. Days off in medieval England took up probably about one-third of the year. And the English were apparently working harder than their neighbors. In France they were guaranteed fifty-two Sundays, ninety rest days, and thirty-eight holidays. In Spain holidays totalled five months per year.

13th century - Adult male peasant, U.K.: 1620 hours
Calculated from Gregory Clark's estimate of 150 days per family, assumes 12 hours per day, 135 days per year for adult male ("Impatience, Poverty, and Open Field Agriculture", mimeo, 1986)


14th century - Casual laborer, U.K.: 1440 hours
Calculated from Nora Ritchie's estimate of 120 days per year. Assumes 12-hour day. ("Labour conditions in Essex in the reign of Richard II", in E.M. Carus-Wilson, ed., Essays in Economic History, vol. II, London: Edward Arnold, 1962).

Middle ages - English worker: 2309 hours
Juliet Schor's estime of average medieval laborer working two-thirds of the year at 9.5 hours per day

1400-1600 - Farmer-miner, adult male, U.K.: 1980 hours
Calculated from Ian Blanchard's estimate of 180 days per year. Assumes 11-hour day ("Labour productivity and work psychology in the English mining industry, 1400-1600", Economic History Review 31, 23 (1978).

But for capitalism , there was a financial incentive to maximize the return on expensive machinery by having long hours, twelve to sixteen hours per day, six to seven days per week were practiced. Cottage handicraft workers learned to fear and hate factory work and its pace of work and degree of discipline. Clocks, not daylight or weather established work patterns. Workers often attempted to observed "Holy Monday" to lengthen the weekend

1840 - Average worker, U.K.: 3105-3588 hours
Based on 69-hour week; hours from W.S. Woytinsky, "Hours of labor," in Encyclopedia of the Social Sciences, vol. III (New York: Macmillan, 1935). Low estimate assumes 45 week year, high one assumes 52 week year

1850 - Average worker, U.S.: 3150-3650 hours
Based on 70-hour week; hours from Joseph Zeisel, "The workweek in American industry, 1850-1956", Monthly Labor Review 81, 23-29 (1958). Low estimate assumes 45 week year, high one assumes 52 week year

Workers have simply recovered what they had four or five centuries ago and but who are now under threat once again of losing.

1987 - Average worker, U.S.: 1949 hours
From The Overworked American: The Unexpected Decline of Leisure, by Juliet B. Schor, Table 2.4

1988 - Manufacturing workers, U.K.: 1856 hours
Calculated from Bureau of Labor Statistics data, Office of Productivity and Technology

From ://groups.csail.mit.edu/mac/users/rauch/worktime/hours_workweek.html

Thursday, December 01, 2011

magic

Magicians do not claim to be practising magic in the literal sense. They see themselves as entertainers who hood-wink the public by what they call “tricks”. It is the self-styled “psychics” who are the problem who claim to be exercising special powers and who take advantage of the bereaved to make a show of pretending to contact the spirits of the dead.

Many, perhaps a majority, believe that there is life after death. Although a number of churches discourage the view, some draw the conclusion that it is therefore possible for the living to contact the dead and vice versa. This is the basis of spiritualism and its "mediums" between the living and the dead. Spiritualists have evolved an elaborate theory to explain how this is possible but most adepts are no more interested in this than the average church-goer is in theology. It's the simple, popular belief that it is possible to contact the dead that attracts them. Science is based upon knowledge and knowledge only. Observation, experiment, classification, generalisation, are its methods. Since there is no scientific evidence of life after death, it's reasonable to assume that mediums cannot be contacting the dead. So what are they doing? Some will be out-and-out frauds who are deceiving vulnerable and gullible people as a way of obtaining the money we must all obtain, one way or another, to survive under capitalism.

Socialists see humans as an animal species that has succeeded in adapting the natural world to meet its needs. We view with wonder and astonishment its magnificent accomplishments in the fields of agriculture and technology . We place our faith not in supernatural forces, but in the intelligence and knowledge of the working class. Socialist understanding is based not simply on a materialist approach to history but also on a materialist approach to the universe, and also to life – this is the only one all of us are going to get, so let's make the most of it.

Wednesday, November 30, 2011

BEYOND THE CUTBACKS.

Your wage or salary is the sum of money necessary to reproduce your ability to work.

Your pension is nothing else than wages or salaries deferred until you retire. Concerns over the effect of increasing life expectancy – sometimes described as a "burden" – are only smoke screens. We need to be clear – lowering pension levels and raising the retirement age are in effect real pay cuts.

Pensions are a transfer payment from the profits of the capitalist class – which ultimately come from what workers as a whole produce. That there is at present a "problem" once more proves that the market economy is incapable of going beyond the limits of the wages system. It cannot adequately provide for the needs of the class that produces and distributes all the wealth in the first place.

Advances gained from the increased productivity of our labour – including an increased life span – are being clawed back by capital to its advantage, pushing the burden from the capitalists onto the workers.

The capitalist class encourages us to see their interests and problems as ours. As a result we find our lives opened up to the chaos and uncontrollable insanity of the market. The market system cannot provide any security for us in the long run, which is why we need to turn the current struggle over wages, salaries, and pensions into a politically organised movement for a society based upon the direct satisfaction of human needs.

It is encouraging to see the fight back. The gains made by wage and salary workers on pay, pensions and other related issues have not, after all, been granted by benevolent governments or employers – they had to be fought for. If those gains are to be defended, democratic and unified action by workers is necessary. If governments and employers win on pensions and wages they will try it again with something else.

Nevertheless, important as activity of this sort is today it still does not get to the crux of the question.

The Socialist Party urges all workers to consider their position. Workers have to strike because they are slaves to the capitalist class who buy our lives by the week or by the month. So, besides making the greatest possible use of trade unions, we ask for recognition that even at their best such action cannot bring permanent security or end
poverty. No strike can stop a government determined to have its way. In the end the logic of capitalism will always win out.

While trade union activity, including strike action, is necessary as long as capitalism lasts it can't work miracles. There can be no lasting solution to the problems the market economy creates within the market system itself. Austerity and insecurity, in a world of potential plenty, is always the lot of the working class. In addition to trade
union action socialist political action is needed on the basis of a clear understanding and awareness of our class interests.

Unions cannot make revolutions – only the working class themselves can do that, through clear, democratic, determined political action.

Our interests are opposed at every point to those of the capitalist class. Our cause can only be the cause of revolution for the abolishing of classes based on a real understanding of our position as workers. Without that understanding, militancy can mean little.

The Socialist Party does not ask for blind support. We do not put ourselves forward as potential leaders. What we seek is understanding. Over the past century we have seen movements rise and fall, we have heard slogans fade into distant echoes, we have encountered scores of "solutions" loudly acclaimed only to be discarded.

The single, simple fact we urge working people to recognise is that capitalism generates problems it is incapable of solving. Workers are so busy taking care of the business of capitalists, we don't have the time and the resources to take care of ourselves. The remedy – the only remedy – is to consciously end the property system that divides and oppresses us.

Sunday, November 27, 2011

S-C-A-ISM minus O-I-L

No one is disputing that in any consideration of existing social problems, the question of energy supply is of prime importance.

But the vital question is about the reasons why the existing world capitalist system cannot take up the technical possibilities which now exist for the setting up of a safe and adequate world energy system. This question also takes us out of the sphere of applied science and technology and inevitably into the sphere of world economics and politics. From a practical point of view, society has available a wide range of technical options and there are large reserves of skill, labour and materials, yet at the same time we suffer from a chronic inability to take these up in a free and consciously regulated manner. In the field of energy supply, as in every other field, such resources, skills and production methods which are taken up will be determined by the economic imperatives of the market system or consistent with the existing national economic or military strategies. Socialism would not be bound by the economics of market competition to use methods which embodied the least amounts of labour in their production. Global energy policy is not being driven by concerns about the environment. It’s about ownership and control of key resources, who has them, and who’s got the weaponry to seize them.

There is no single alternative to oil, so a suite of alternatives will have to be employed. The main problem with renewables is that the oil-addicted capitalist economy has starved them of funds, because set-up costs are prohibitive and returns long-term. This is true of geothermal heating systems, wind and tidal systems, ocean thermal electricity, biowaste to oil reconversion plants, solar technology. Capitalism is not, of course,really interested in saving energy. Energy companies could offer customer discounts to those who were frugal, but in fact that's not the way to make money. Thermal Conversion Process can take any type of carbon waste including animal remains, car tyres, old computers and human sewage and within half an hour turn it into useful fertilizer minerals, carbon charcoal and oil. What’s the catch? Lack of profit. Paul Horsnell, Head of Energy Research at investment bank Barclays Capital: “To transport and process all the waste, pay the energy costs, provide for the capital costs and still make a profit does look difficult at first sight. By comparison, fossil fuel oil is actually pretty cheap.”
Under capitalism renewable sources will only be adopted on a wide scale when the price becomes right.

We live in a social system predicated on endless expansion and it is the blind, unplanned drive to accumulate is the hallmark of capitalist production – the profit motive – that has created the environmental problem, not individuals. There can be no such thing as sustainable or environmentally friendly capitalism. It is completely impossible under capitalism for humanity to use the earth's resources for the benefit of all people, and it is equally impossible for it to deploy the accumulated knowledge, the skills and the techniques of production which now exist in a direct relationship with human needs on a basis of world-wide co-operation.

If capitalism uses up the obtainable oil in its customary spendthrift way, then socialism is going to have to employ solutions, both in means of supply and modes of consumption.

What is, for a socialist, strange is nobody ever suggests that we just take drop in energy consumption and live with it. How can we continue to live the life of the motorway-commuter without petrol? Oh no, we can't possibly give that up, we'll have to use hydrogen or electric cars. How do we continue to have all our cities' department stores lit up every night so people can window-shop at 4 am? Dread the thought that consumers should have their nocturnal browsing habits constrained.

Humanity may have no choice but to adapt to a low energy way of life. Yet studies abound that demonstrate that traditional intensive farming methods can out-perform industrial agricultural methods. People may desire this change but the economic framework of capitalism won’t allow it.

Fusion power is the Holy Grail but that infinite energy would be uncomfortable to capitalist markets. It could never be allowed to get out. If fusion ever came about , we can be sure about one thing - our electricity bills won't go down. New technology tends to deliver wealth upwards, to the rich who own and control it, not downwards to the rest of us.


Friday, November 25, 2011

divide and rule

Religion is not simply a jumble of confused ideas. It is a powerful weapon in the hands of the capitalist class. It divides us and blinds us to the class action that is required to overcome the menace of capitalism. Religion is the ideological expression of a long-gone world and its ancient social conditions, a world of superstition, slavery and little education. Far from providing an answer to today’s problems, it tells us to put our faith in the supernatural hopes of a past age. Instead of uniting us as a class we are to become meek and mild, and to submit to the whims of an ancient god. From the dawn of civilisation religion has been a weapon of political domination. The working class though not as yet hostile to religion, are nevertheless becoming increasingly indifferent to it. Religion is dying but not yet dead. None of us is born Christian or Muslim or anything else. We’re born with no knowledge or beliefs in any god. In fact we’re all born into a state of atheism. Wherever the accident of birth sees each child born, each individual is born totally dependent and without language or religion. A child develops speaking the language of its home. A child raised in a religion-free zone will not acquire religious knowledge. For this to occur it would need to be exposed habitually to ideas, concepts and beliefs by those around it. How many people make a conscious choice of religion and how many simply continue with what they were born into as part of their traditional culture, religious or not?

Belief in religion – any religion – hampers the ability to think objectively, particularly about social and political issues. The disappearance of all religious beliefs should be seen as an essential part of our struggle for socialism and not just as a fringe irrelevance. It isn’t simply a question of religion being false, or brutal or divisive; it is a weapon of the ruling class, a bulwark in the way of the emancipation of the working class, a hurdle to be overcome in the progress to socialism nor could it be overcome while the conditions that nourished it continued to exist. Thus, the socialist sees religion as an integral part of the class struggle.

Despite occasional public pronouncements that the West had no quarrel with mainstream Islam, there is no doubt whatever that, with help from the media and repeated insinuations from various officials, the widespread impression has been created that opposition to, hatred of and terrorism against the West is essentially “a Muslim thing” and that the Islamic faith itself carries the seeds of violence and terrorism. Thus we see that a difference in religion has offered the opportunity for capitalism to denigrate as scapegoats the Islamic world: and to drive a wedge of suspicion and distrust between western workers and their eastern counterparts – a good present-day example of the old imperial dodge of “divide and rule”.

Saturday, November 12, 2011

Banking yet again

Surely, the current banking crisis has exploded the myth about banks being able to create credit, i.e. money to lend out at interest, by a mere stroke of the pen but apparently not. Financial crises always spark interest in critics of the system. They see the problems of capitalism—like its vulnerability to crises—as primarily financial in origin. The whole point of production under capitalism is not the satisfaction of needs, but the accumulation of money. In other words, it’s impossible to separate the economic world into a good productive side and a bad financial side; the two are inseparable. The monetary surpluses generated in production—the profits of capitalist businesses—accumulate over time and demand some sort of outlet: bank deposits, bonds, stocks, whatever. It’s going to be that way until we replace capitalism with something radically different. What we need to ask is why people today tend to blame banks rather than capitalism as a whole.

No bank can lend more than it has, either as deposits or what it has itself borrowed. The idea that money is created through fractional reserve banking is more of a metaphor. Let's take a simple case.

I start a bank with a 10% fractional reserve. Alice deposits $1000 with my bank. I can then lend $900 to Bob, who wants to start a small business and pays the $900 to Charlie for equipment. Charlie deposits this money in my bank. I can now lend $810 to Debbie ...

Let's stop it there and see who has what. Alice "has" $1000 (which she doesn't), which is "in" my bank (though most of it isn't). Charlie has $900, which is also "in" my bank. And Debbie is holding $810 of actual money. (You might ask: what about the $190 reserve in my bank? But we've already counted that once, it belongs to Alice and Charlie.) So it looks almost as though I've turned Alice's original $1000 into $2710 just by moving it about and signing things. In that sense, whoopee, I've "created" money.

But note that there's still the same amount of actual cash. Debbie has $810 of it and I have $190 of it.

Furthermore, let's look at my balance sheet. I am holding $190. Bob owes me $900. Debbie owes me $810. I have assets of $1900.

But on the other hand, I owe Alice $1000 and I owe Charlie $900. I have liabilities of $1900.

Unless I charge interest, which I will, I'm not up on the deal. (Some argue that the only way that interest can be paid is by issuing more new loans. Presumably businesses borrow from banks to invest and expand. Higher profits from those expanded activities should more than cover the interest.)

Let's do one more sum. Alice has assets of $1000. Charlie has assets of $900. Debbie has assets of $810. I have assets of $1900. Total assets in the system: $4610. Whereas on the other side of the balance sheet, I have liabilities of $1900, Bob has liabilities of $900, and Debbie has liabilities of $810. Total liabilities in the system: $3610. Total assets minus total liabilities = $1000, which is what Alice started off with. So I'm only "creating" money by creating debt at the same time. Debt being, as it were, negative money.

Now, if this all still sounds suspicious to you, do the same math where Alice has $1000, she lends $900 directly to Bob who pays Charlie, Charlie lends $810 directly to Debbie, and everyone keeps their money under their mattresses.

The "creation" of money works out the same. Alice has $100 under her mattress and an IOU worth $900. Charlie has $90 under his mattress and an IOU worth $810. And Debbie has $810 in cash. Which makes $2710 --- again. It's the existence of lending and borrowing that "creates" the money: my bank has no special power to do so. What my bank did was to arrange the loans and act as a rather more secure substitute for the mattress. There's nothing particularly unreasonable (or profitable) about a bank doing this rather than people doing it for themselves.
Let's continue my story about Alice and Bob and the rest of the gang.

Suppose Alice, Charlie, and Debbie all decide to use their money to buy derivatives from Edward. Alice and Bob both write him checks, and Debbie pays cash.

And now between them they own $2710 worth of derivatives, even though the system of transactions is based on only $1000 of actual cash. And at this point I, the banker, still have net assets of $0 and hold only $190 in actual cash.

(Moreover, when Edward pays the checks he got from Alice and Bob and the cash he got from Debbie into his account at my bank, then I'll have $1000 in cash and liabilities (to Edward) of $2710, and can start looking around for someone who wants to borrow $729 ... quite possibly to buy some more derivatives.)

The money still isn't coming out of nowhere, it's coming from the obligation of people who borrow money to pay it back. And again, the bank as such is not "creating" the money, it's the fact that people are lending and borrowing that does that. The bank is just the middleman. What is never emphasised is that money is used and re-used and re-used again to create new and more deposits. One of the key features of capitalism is that money circulates. The banking system has not created any money out of nothing. It is still dependent on individual banks only being able to lend out what has been deposited with them or what they themselves have borrowed. The same coins and notes can be used for many different transactions including more than one bank deposit. These will have been generated by the mainly productive activities in which the series of loans can be assumed, in the real world. The banking system has created more “money” only if you regard “bank deposits” as money. If you don’t, all that has been shown is that currency has circulated in that the whole process depends on the initial deposit or injection of cash being recycled as further deposits by depositors (as opposed to by banks creating a credit line). So, neither an individual bank nor the whole banking system can lend more than has been deposited with it. All this assumes an expanding economy, since where is the money to repay the loans and the interest on them to come from without being assured of which the banks would not lend the money in the first place? So the banking system does not create money to lend out of thin air but can only lend out money deposited with it and then only when economic conditions permit it.

In 1931 the MacMillan Committee Report into Finance and Industry was written in large part by John Maynard Keynes and gave credence to the myth but you may be interested to know that a significant minority of the Committee at the time opposed the view promoted by Keynes and several of those who went along with it did not understand or realise the implications of what they had signed up to. Keynes in The General Theory of Employment, Interest and Money (1936) effectively abandoned the view he had promoted on the MacMillan Committee just a few years previously. What the simplistic model used in the Report had assumed was that banks kept a certain 'cash ratio' back for customers to access as a proportion of whatever is deposited with the bank (10 percent was assumed at the time though these days this would be far less). They then assumed that the whole of a new deposit by a customer could be held in cash to underpin the creation of credit nine times its value (i.e. operating with a 10 percent cash reserve an initial $1,000 deposit would enable the creation of $9,000 worth of credit). It also then assumed that this cash was never called upon in practice. In other words, for the model to hold, they correctly assumed that banks kept cash in reserve for customer use, but then assumed that nobody ever withdrew any of it. Samuelson and others reject the approach used by the MacMillan Committee in favour of a multi-bank model. However, this model does not demonstrate anything more than that currency circulates around the banking system and can be used more than once in the process of customers' creating bank deposits - as opposed to banks somehow creating multiples of credit from these deposits.

Everybody accepts that hard cash - currency - is money. The first point to be clear on is the definition of "money". Up to WW2 there was more or less agreement that money was "currency" (notes and coins). Since then "bank loans" have been regarded as money. This is okay as long as the same definition is kept to throughout the analysis. But it should be noted that, even today, conventional economics has felt the need to distinguish between M0 (mostly currency) and M1 (which is M0 + bank loans) (M2, M3 and M4 are M1 plus various other types of loan). people say "banks create money" this is true (by definition) if money is defined as M1. But it wouldn't mean that banks create all money, as M0 is created by governments and/or central banks. Having said this, it is true that only 3% of M1 is currency and 97% bank loans. The case against regarding both bank loans and currency as money is that they come into being and behave differently. Currency circulates. Bank loans don't. In fact, although M0 is only only about 3% of M1 it can be used to make payments, etc (including bank deposits and bank loans) of many times its face value.

Some might be prepared to include cash deposited in banks as well. Others though widen the definition to just deposits by people of the money they already possess but any account for which the holder has a cheque card (transactional accounts hence no or little interest or in fact a users fee imposed), i.e. including credit lines granted to those who banks have lent money to “debt money”. “Money creation” is now about “bank deposit” creation"! Fractional reserve banking leads to the creation of more “money” in the sense of more bank deposits for banks have learned that when cash has been deposited with them they only need to keep a part (a “fraction”) of it as cash as a “reserve” to deal with likely cash withdrawals; the rest they can lend out.

If $10,000 is deposited in the banking system, initially say in one bank, that bank can make loans (create credit line bank deposits) of $9000. When it is spent this $9000 will be re-deposited in other banks which can then lend out 90 percent of this, or $8100; which in turn will be re-deposited in banks, allowing a further $7290 to be lent out, and so on, until in the end and over the period, a total of $90,000 new loans will have been made. This shows how the Fed can practise “fractional reserve banking” to control the amount of “money” (currency plus bank deposits) in the economy. The Fed, through its trading desk at the Federal Reserve Bank of New York, buys $10,000 of Treasury bills from a dealer in US government securities. In today’s world of computerized financial transactions, the Fed pays for the securities with an ‘electronic’ cheque drawn on itself. The Fed has added $10,000 of securities to its assets, which it has paid for, in effect, by creating a liability on itself in the form of bank reserve balances.The bank from which the Treasury bills were purchased now has reserves above the 10 percent limit and so can turn the $10,000 into loans, which starts the process described above rolling, leading to an extra $90,000 bank lending. The one bank that can create money out of thin air and that is the government-owned or controlled central bank. It does so by mere decision, by creating more "fiat" ("let it be") money and introduces it into circulation by using it to buy government bonds off commercial banks ("quantitative easing" is a variety of this)

Banks don’t just borrow from individual depositors, or “retail”. They also borrow “wholesale” from the money market. It is in fact the difficulties they have experienced here with the inter-bank lending that has revealed that they cannot create credit out of nothing. Banks are reluctant to lend on the money market for fear that the borrowing bank might turn out to be insolvent. Which meant that one source of money for the banks to re-lend to their customers had shrunk. So, deprived of this source of money, the banks had less to lend out themselves. Which, of course, wouldn’t have been a problem if they really did have the power to create money to lend out of nothing.

The on-going banking crisis problems arose because they wished to lend out more than had been deposited with them and to do this they had to borrow 'short' on the money markets to finance their long-term loans and mortgages. The game was up - and no-one could just tell them to go away and create some more multiples of credit from their deposits! There is no easy way out of this crisis for banks by attracting some more extra deposits and then creating vast multiples of credit from them to magically cover their losses.

It seems to be rather that because money so dominates people's lives and that they associate money with banks that people's resentment at their money problems is aimed at banks. Of course no banking or monetary reform is going to stop money dominating people's lives.

"I think that people have learned that money is not made in banks. It is made by real people working hard at real jobs. Actually, deep down we knew that all along. We just have to learn it again." Asbjorn Jonsson, an Icelandic fisherman, in a week when Iceland was effectively a bankrupt state. Its banks owed the world an astonishing £35billion - 12 times the size of Iceland’s gross domestic product and £116,000 for every man, woman and child.

Remembering

Some ten million lives were lost in World War One. Among these countless casualties is a small group of about three hundred and fifty who are not remembered when the dignitaries lay their wreaths because they didn't die a "heroic" death at the hands of the enemy. They were shot by their own comrades because these unfortunate few had to be made examples of what happens to those who refuse to obey suicidal orders. They knew fear and possessed a sense of self-preservation. The army has a special term for people who respond rationally to this entirely natural emotion: they are known as "cowards".

Trench warfare essentially involved periodically massing thousands of men and then sending them like lemmings towards the enemy lines, resulting in catastrophic casualties, often for a gain of just mere yards of ground, if any. Given that such behaviour, except to the seriously mentally unbalanced or the suicidal, naturally appeared to be utter lunacy, the politicians had to provide some incentive to persuade the potentially sceptical recruits to act like madmen. The principal methods of course were propaganda and flattery. Conscripts were told that it was their duty and privilege to rid the world of the despicable Hun and then having preserved democracy and fair play, and saved Good Old England for all its decent, God-fearing citizens, the troops would then be welcomed home as heroes and be forever intoxicated by the eternal gratitude of their countrymen. Not surprisingly, the top brass in the army realised that this would fool the thoughtful few. And if only a few sceptics concluded that they were being duped, they might well persuade many others to lay down their arms and engage in some No-Mans-Land fraternalisation with the foe and play some friendly football. Therefore, an extra "incentive" was required. Either go over the top and face almost probable death, or refuse and face certain death.

It's difficult to imagine what must have gone through the minds of those conscripts as they huddled in their cold, damp, dirty trenches, waiting for the order to ascend into no-man's-land with only a tin hat and a rifle for protection against a phalanx of machine guns and mortars. It was a different world then, not only in the way wars were fought, but also in the way minds were moulded. It would seem likely that anyone who wishes to avoid almost certain death is in an absolutely sound state of mind but the naive and innocent victims of the firing squads of eighty years ago had the misfortune to be born into a very different stage of capitalism's destructive development, when daily casualties could wipe out entire regiments. The soldiers of the Great War were unfortunate to live in an era when courage, however you defined it, equalled death.

There were claims that the executions of soldiers was a class issue. James Crozier was found guilty of deserting his post and was shot. Two weeks earlier, 2nd Lieutenant Annandale was found guilty of the same but was not sentenced to death due to "technicalities". In the duration of the war, fifteen officers, sentenced to death, received a royal pardon. In the summer of 1916, all officers of the rank of captain and above were given an order that all cases of cowardice should be punished by death and that a medical excuse should not be tolerated. However, this was not the case if officers were found to be suffering from neurasthenia.

Private Thomas Highgate was the first to suffer such military justice. Unable to bear the carnage of 7,800 British troops at the Battle of Mons, he had fled and hidden in a barn. He was undefended at his trial because all his comrades from the Royal West Kents had been killed, injured or captured. Just 35 days into the war, Private Highgate was executed at the age of 17.

16-year-old Herbert Burden, who had lied that he was two years older so he could join the Northumberland Fusiliers. Ten months later, he was court-martialled for fleeing after seeing his friends massacred at the battlefield of Bellwarde Ridge. He faced the firing squad still officially too young to be in his regiment.

The French are thought to have killed about 600 (probably an under-estimate). The Germans, whose troops outnumbered the British by two to one, shot 48 of their own men, and the Belgians 13. In 2001, 23 executed Canadians were executed , and five troops killed by New Zealand's military command. No Australian soldier was executed because the Death Penalty in the Armed Forces was abolished with the 1903 Defence Act, following the execution ( by a British Court Martial ) of "Breaker" Morant and Hancock and the public outcry.

Cathryn Corns, co-author of Blindfold and Alone, which examines 306 courts martial "The number of rogues outnumbered those with mitigating circumstances by about six to one," she said.

The death sentence for desertion in the British forces was abolished in 1929.

Today, Britain has a professional volunteer army, and technical improvements in weaponry mean that modern warfare is a much more scientific affair. Remote-controlled unmanned drones have turned much combat into computer game style
slaughter. Now there are no poorly trained conscripts, and no need for battalions of troops to go "over the top", and so there is no need for summary executions to enforce discipline. To some, war is heroic yet one thing that can be said for definite about wars: they are never fought in the interest of those who die in them.

Friday, November 11, 2011

Talking Capitalism is not talking !

Just before Ecclestone rushed off to fly in his private jet to the F1 grand prix in Abu Dhabi, Bernie Ecclestone was giving evidence in modern Germany's biggest corruption trial. It gave an illuminating insight into one of the richest men in world sport. He was testifying against Gerhard Gribkowsky, a former executive at the state-owned BayernLB bank, who is accused of accepting Ecclestone's $44m (£27.5m) in return for smoothing over the 2005 sale of the bank's $839m stake in F1 to CVC, the private equity group. Ecclestone claims that he paid up only because he was "shaken down" by the German, who, according to Ecclestone, was going to give HM Revenue and Customs "false" information about his financial affairs which could leave him with a tax bill "in excess of £2bn".

Ecclestone's insists that Bambino, the multibillion-pound offshore trust set up in Slavika's name containing the bulk of his assets, is not in fact controlled by him. "I don't control the trust, but if the Revenue had investigated, the burden of proof would have been on me to prove I wasn't," he said. Ecclestone said that Slavika and Bambino's trustees decided to contribute to the "shakedown" payment of their own accord, rather than because he ordered them to do so. He and his ex-wife, Croatian model Slavika, 53, never discussed business or financial affairs. This matters because Ecclestone says he had been advised that the trust's balance would be subject to a 40% tax claim from Revenue and Customs if they believe he has anything to do with it: an allegation Ecclestone has said he thought Gribkowsky was going to make.

He didn't ever discuss a figure with Gribkowsky, he testified – a claim received with incredulity by the judge. "You're seriously saying you were going to transfer all that money without telling him so that he only discovered it when he went to the cash machine and checked his balance?" he asked.

Yes, insisted Ecclestone. "[Gribkowsky] wasn't the sort of person to say 'pay me this or I'll do that' and I'm not the sort of person who says 'I'll pay you this if you don't do that,'" he said.

'let's think about it.' Which in English is a very clear no. People don't always understand that."

http://www.guardian.co.uk/sport/2011/nov/09/bernie-ecclestone-germany-trial-witness
http://www.guardian.co.uk/sport/2011/nov/10/bernie-ecclestone-denies-wedding-bill

Tuesday, November 08, 2011

Selling the Revolution

Entrepreneurs are seeking to profit from the demonstrations with T-shirts and other merchandise. T-shirts began to appear days after the first protest on 17 September, a march through lower Manhattan. Now T-shirts, coffee mugs and other merchandise are being offered on the campsites that have sprung up in cities across the US. The US patent and trademark office has received a spate of applications.

Ray Agrinzone, a clothing designer, who launched a website, said: "There's nothing wrong with turning a profit."


Thursday, November 03, 2011

The recession's recovery

"Permanent crises do not exist" Marx wrote

He meant that the slump itself would create the conditions for capital accumulation to resume. For Marx the accumulation of capital, which is the engine of economic growth, proceeded in fits and starts, a series of cycles of moderate activity, boom, crisis, slump, recovery, moderate activity, boom, crisis, etc. Booms eventually created the conditions for the next following slump while slumps created those for recovery.

“This fall in the purely nominal capital,” Marx explained “State bonds, shares etc....amounts only to the transfer of wealth from one hand to another and will, on the whole, act favourably upon reproduction, since the parvenus into whose hands these stocks or shares fall cheaply, are mostly more enterprising than their former owners.”

The financial world has been gripped by the recession. Yet one cabal of investors, bankers and lawyers found plenty to toast at London’s opulent Claridge’s hotel last month. One fund manager enthused “There’s a tidal wave of opportunities coming now.”

A German minister once called them “locusts”. Other choice descriptions are “corporate raiders”, “predators”, “vultures” and “asset strippers”. Socialists apply some of these descriptions to all capitalists, but what have these particular kind of capitalists done to earn such epithets even from non-socialists?

This is the sector which seeks to take advantage of stressed and dislocated financial markets. It typically comprises hedge funds or private equity firms that acquire at a discount fundamentally sound or defaulted loans, bonds or entire portfolios of debt from banks and other investors under duress, and attempt to squeeze out a profit. Alternatively, they may try to seize control of struggling companies by buying their loans and bonds, and converting this debt into equity ownership – a strategy known as “loan to own”.

European companies have to repay more than $4,000bn of loans and bonds in the next four years, according to credit rating agency Standard & Poor’s – a formidable sum at a time when the continent faces unprecedented pressure. Most are expected to manage to repay or roll over these debts, but some are expected to founder and could be taken over by distressed debt investors. Europe’s banks, normally a ready source of funding for many of these companies, are themselves struggling. Banks in France, the UK, Ireland, Germany and Spain have unveiled plans to slash a total of €775bn ($1,065bn) of assets, according to data collected by Bloomberg. Leon Black of Apollo Global Management, a leading investor in distressed debt, recently estimated this sum could increase to €1,500bn in coming years. It will provide investors with opportunities to cherry-pick assets, financiers say. Many are eyeing Ireland, where loans and property worth a nominal €72bn have been taken over by the National Asset Management Agency, a state-run “bad bank”, and will gradually be sold off.

Most investment banks are rebuilding or beefing up distressed debt desks, expecting the sector to provide a rich vein of lucrative business in the coming years. “We’re just in the first innings,” says the European head of a major US firm. “We have already bought quite a bit already, and the market is going to be huge over the next few years.”

From capitalism’s point of view, they are not doing anything wrong. In fact, they are only doing what comes naturally to capitalists: trying to make the biggest profit they can. The parvenus are buying up failed and failing business at bargain prices. As well as laughing all the way to the bank they can justify their unpopular activity as performing a necessary function in capitalism’s business cycle. As indeed they are.

What shape will the recovery turn out to have. The optimists are hoping that it will be V-shaped (i.e. a fairly rapid return to pre-recession levels). Others see it as being more like a tick (i.e. a slower recovery). The pessimists see it like a W (i.e. a double dip, a initial small recovery followed by second fall).

The only solution to the problems of a depression is the depression itself. If capitalism is to return to profitability, unprofitable concerns must be closed, workers laid off, wages suppressed, and capital devalued. This restores profitability and lays the basis for a new round of capitalist prosperity.Unprofitable firms must be eliminated, their capital destroyed or devalued, and real wages must fall, so as to restore the rate of profit. That means more company failures and more unemployment. In short, more misery. This tells us nothing about how long this might take. Could the present slump really last for a decade or more? The truth is we don’t know and can’t know. The future course of capitalism is largely unpredictable.Economic forecasting is no more reliable than an astrological horoscope. All we can say with certainty is that it is an irrational system.

A number of quite distinct and separate things need to happen before a slump can run its course. Firstly, capital has to be wiped out if excess productive capacity is to be tackled with devalued capital being bought cheaply by those enterprises in the best position to survive the slump. Secondly, de-stocking needs to take place, with overproduced commodities bought up cheaply or written off entirely. Investment will not resume if overproduction still exists. Thirdly, after this has occurred there needs to be an increase in the rate of industrial profit helped both by real wage cuts and falling interest rates (which tail off naturally as the demand for more money capital eases off in the slump). This will help renew investment and increase accumulation. Also, if recovery is to be sustained, a large proportion of the debt built up during the boom years will need to be liquidated, if it is not to act as a drag on future accumulation. Through these mechanisms a slump helps build the conditions for future growth, ridding capitalism of inefficient units of production. When these processes have run their course, accumulation and growth can begin once more with capitalism again creating a boom situation, which will be inevitably followed by a crisis and slump. This has been the history of capitalism ever since it first developed. Far from being an aberration, this cycle of misery is the natural cycle of capitalism.

Workers cannot be indifferent to a crisis, no matter how much we are disgusted by the predictable pendulum swing between “boom” and “bust” , because our lives can be directly influenced by today’s financial turbulence. But at the same time, we have no interest whatsoever in thinking up ways to put capitalism “back on track” or make it “healthy” again. Even when the system is in tip-top shape it works directly counter to the interests of workers. The crisis will not miraculously or mechanically turn every worker into a socialist, as some hope, but it does at least create a situation where socialists may find workers more willing to consider an alternative to capitalism. It is up to us, as socialists, to present that alternative in a convincing way based on our understanding of the essential nature and limitations of the capitalist system.

Monday, October 31, 2011

One Life

Approximately 3% of the US population say they have had a near-death experience, according to a Gallup poll. Near-death experiences are reported across cultures and can be found in literature dating back to ancient Greece.

Near-death experiences are simply "manifestations of normal brain functions gone awry" and that many common near-death experiences could be caused by the brain's attempt to make sense of unusual sensations and perceptions occurring during a traumatic event, researchers explain. Dr Caroline Watt, said: "Our brains are very good at fooling us...The scientific evidence suggests that all aspects of the near-death experience have a biological basis."

There is a condition called "Cotard" - or "walking corpse" syndrome, where a person believes they are dead. It has been seen following trauma and during the advanced stages of typhoid and multiple sclerosis. Out-of-body experiences, where people feel they are floating above themselves, are also commonly reported. But Swiss researchers found such experiences could be artificially induced by stimulating the right temporoparietal junction in the brain that plays a role in perception and awareness. The "tunnel of light" sensation reported by those who believe they are having a near-death experience can also be artificially induced. Pilots flying at G-force can sometimes experience "hypertensive syncope" which causes tunnel-like peripheral or even central visual loss for up to eight seconds. And a US study suggested the light at the end of the tunnel can be explained by poor blood and oxygen supply to the eye. The feelings of bliss and euphoria, meanwhile, can be recreated with drugs such as ketamine and amphetamine. The paper also suggests the action of noradrenaline, a hormone released by the mid-brain, can evoke positive emotions, hallucinations and other features of the near-death experience.

"Taken together, the scientific experience suggests that all aspects of near-death experience have a neuro-physiological or psychological basis."

http://www.bbc.co.uk/news/health-15494379

The Wealth Gap Grows

Pay for the directors of the UK's top businesses rose 50% over the past year Incomes Data Services (IDS) said. The average pay for a director of a FTSE 100 company to just short of £2.7m.

Brendan Barber, the TUC's general secretary, said: "Top directors have used tough business conditions to impose real wage cuts, which have hit people's living standards and the wider economy, but have shown no such restraint with their own pay."

"When you think the average pay is going up 1% or 2%, it's not even meeting price rises. These pay packages have become so complex that executives don't even understand it themselves." Deborah Hargreaves, chair of the High Pay Commission, told BBC.

At a time when company share prices and profits have fallen, what explains such extravagant rewards? Pay is set by remuneration committees, who are supposedly bound to guard the shareholder interest. But in practice the committees are dominated by a closed circle of former managers, who can ignore shareholder votes. Deborah Hargreavesnoted on the Today programme: "remuneration committees on companies are often made up of other executives from other companies with an interest in keeping pay high."

According to the IDS, Mick Davis who heads Xstrata was the highest paid executive in the FTSE 100. The mining giant extracts metals, exports coal and harvests wood in locations from Chile to Australia. Davis was paid £18,426,105.

Bart Becht retired as the chief executive of Reckitt Benckiser in April after 16 years at the company. With a total pay packet of £17,879,000, he was the second highest paid executive on the list.

ICAP boss Michael Spencer made £13,419,619 according to IDS.

In fourth place was the former Tesco boss Terry Leahy, who was paid £12,038,303. He retired in March.

Tom Albanese has been at the helm of the mining group Rio Tinto for four years. According to IDS, he was paid £11,623,162, ranking him fifth highest paid executive in Britain's top 100 companies.
http://news.sky.com/home/business/article/16098319

.

Sunday, October 23, 2011

Meet the 1%

Among the top one percent category are the following:

Warren Buffett...................USD 39 billion (Berkshire Hathaway)
Charles Koch.....................USD 25 billion (Koch Industries Inc)
George Soros.....................USD 22 billion (Soros Fund Management)
Sheldon Adelson................USD 21.5 billion (Las Vegas Sands Corp)
Michael Bloomberg.............USD 19.5 billion (Bloomberg L.P)
John Paulson......................USD 15.5 billion (Paulson & Co)
Carl Icahn............................USD 13 billion (Viacom)
Anne Cox Chambers.................USD 12 billion (Cox Enterprises)
Ronald Perelman.......................USD 12 billion (MacAndrews & Forces Holdings Inc)
Abigail Johnson.....................USD 11.7 billion (Fidelity Investments)

Friday, October 21, 2011

But we arer the same the world over

It is all too easy to blame immigrants for causing problems such as unemployment, bad housing or crime. Whether it is Eastern Europeans or Asians, a finger can always be pointed at ‘them’ for making things worse for ‘us’. It is often objected that immigrants come in order to claim benefits and live off the backs of ‘locals'. But there is no reason to think this is true in the vast majority of cases since benefits are low, and most migrants are not entitled to them anyway plus the migration journey can be expensive and arduous, sometimes fatal, with many dying suffocating in containers. Many 'natives' cannot contain their indignation that immigrants should try to come here at all and talk about immigration undermining 'indigenous' culture is so much hogwash. A nation is not something natural but an artificial idea that has been constructed over the centuries, based on accidents of geography and history. From fish and chips to curry and pizza, food in Britain is a mixture just as much as the inhabitants of these islands are. Without the constant propaganda against "foreigners", where would "nationalist" feeling come from? Such feelings are not inborn. Small children are not hostile to other children with different-coloured skin, any more than they are to those with different-coloured hair, or different-coloured shoes. Why should they be? Those travelling long distances through fear or desperation are people no different to ourselves.

Migrants are rarely well off in the country they move to, forming an underclass with little if any security of employment or housing. Immigrants often receive low paying work in the service industry ( the 3-D jobs, dirty dangerous and difficult), once they enter the developed capitalist system and they can never afford the education to gain higher paying jobs. As a result they stay in the service industry their entire lives, being some of the most lowly-paid members of the working class of wage and salary earners.The immigrants who now try to settle in Britain come at the bottom of the social scale, taking the worst houses, accepting the worst conditions. Likely to be of more importance is the perception (rightly or wrongly) that Britain is a fair and open society and the desire to be with family and friends already in the UK. Such primary reasons stem largely from the foreign policy of the UK government, in presenting itself as a bastion of the free world whilst simultaneously exerting links over far-flung lands. It is taught in school that capitalist countries are mosaic countries, small units of various cultures existing within a larger schema or government. This view is marketed so that potential immigrants will not have to leave their customs behind and still be able to reap the so-called rewards of capitalist society. Yet only those who assimilate into the capitalist system are able to experience the "freedoms" it promises, often at the cost to their own culture.

While it is true that the decision to economically migrate is not taken solely on labour market factors, and the nature of the political regime and the historic links may well have a strong determining role, nevertheless the demand for labour to be attracted to concentrated areas is a structural feature of capitalism. Since its inception, capitalism has drawn workers into highly concentrated areas of development in order to satisfy its labour needs. All those people seeking migration are simply obeying the imperative that they must try to find a place to work; and no amount of government restrictions will change that fact. Hence, migrants with even a smattering of English, and a desire to work for a bearable living standard or to pay off debts to people-traffickers, choose countries like Britain.

No ruling class is ever completely unanimous. Capitalism creates conflicts within each ruling class; no two capitalists have interests which are exactly the same. The question of immigration causes disputes within the British ruling class. Some want to establish the principle that when a particular industry or trade is short of workers, its owners have the right to bring in workers from any other country, and thus help to counteract the danger of having to raise wages and salaries. Some other members of the capitalist class feel it would be a mistake to let in too many workers from other countries. Some members of the capitalist class take advantage of any "foreign" immigration to whip up nationalist feeling, using the perception among workers (who have the votes) that there is some threat to themselves from competitors from overseas. Those who are in possession of little are easily frightened by the threat of some other coming to take it away. The appearance of jobs going to these “foreigners” whilst their “own” go without work reinforces the illusion that migration causes unemployment. World socialists have argued that racism is usually fuelled and ignited by poverty and fear, and therefore cannot be removed until the cause is.

So while many of those seeking to enter the UK might be well-qualified machine operators, engineers, builders, doctors etc (as they are), if the capitalist economy is going through yet another of its inevitable cyclical crises, there'll be no employers or money to pay for these much-needed workers. Such economic crises make migrants unwanted. They put politicians under maximum pressure to keep them out to minimise state expenditure, spending which reduces the nation's profitability the bigger it gets, and is especially disliked when making profits is then as difficult as it gets. Increased racism and nationalism also become more likely as high unemployment and poverty produce considerable social suffering, provoking the pained to find and lash out at those they think responsible, and politicians in need of scapegoats, chauvinistic bigots and money-mad tabloids all eager to point some out.

The problems we face are not caused by workers from other parts of the world migrating to this part, but by the capitalist system of class ownership and production for profit instead of the common ownership and production geared to satisfying people's needs which will be the case in socialism. The socialist response is simply to point out that poverty and social disruption are caused by capitalism, a social system which requires the vast majority of the population to rely on selling their labour power to survive. With or without immigration there will be unemployment, homelessness, crime. What an extraordinary notion it is that so many members of the human race should be forced to remain on that small section of the earth's surface in which they happened to be born. Who gave the world's rulers the right to tell us which bit of land we should live on? How much longer are we willing to sit around and let a tiny minority divide us? Socialists understand that the thing which makes workers leave behind their communities, and go to a place where their language is not spoken, is the wages system itself, which swats humans around the globe like a kitten playing with its toys. This underlies the need for us to recognise our identical position with regards to the wages system, and work together, as workers across the world, across boundaries, to create a commonly owned planet where all can live in security.What socialists envisage is that when the resources of the Earth have become the common heritage of all the human race then the world would no longer be divided into separate states, and people would be free to travel anyway in the world without needing a passport or visa and whether to live or to work or simply for pleasure.

Unique amongst all political parties, left or right, the Socialist Party has no national axe to grind. We side with no particular state or government. We have no time for border controls. The world over, workers must do what they can individually and collectively to survive and resist capitalism. In many parts of the world that means escaping political tyranny or economic poverty. Workers should try and resist taking sides. We must not blame another worker for our poverty.

Tuesday, October 18, 2011

THE SAME THE WORLD OVER

Stats (excluding the US) from the past few years, i have come across.

The economic elite have at least $46 trillion in wealth. The majority of this wealth is held within the upper one-tenth of one percent of the population.

Across the world 10.9million people have $42.7 trillion between them in their bank accounts.

Just a one trillion dollar pile of $100 bills would be 20 times the height of Mt. Everest.One trillion is equal to 1000 billion, or $1,000,000,000,000. To put it in perspective, last year the entire cost of feeding all 40 million Americans on food stamps was $65 billion. If you make $50,000 a year, and don’t spend a single penny of it, it will take you 20,000 years to save a billion dollars.

According to data from the Boston Consulting Group, millionaire households represent just 0.9 percent of the global population, but control some 39 percent of the planet's wealth

According the 2010 Global Wealth Report There were 11.2 million millionaire households in the world at the end of 2009 (a “millionaire household” is a household with $1 million or more in assets under management. Those assets don’t include real-estate, private businesses or luxury goods. It does include cash deposits, money-market funds, listed securities held directly or indirectly through management investments, and onshore and offshore assets.)

83% of the world’s households own only 13% of the wealth. The top 0.5% of households (those with $5 million or more) owned 21%, or $23 trillion, of the world’s wealth.

In 1998 ,the United Nations produced a report that the world's 225 richest people now have a combined wealth of $1 trillion. That's equal to the combined annual income of the world's 2.5 billion poorests people.The wealth of the three most well-to-do individuals now exceeds the combined GDP of the 48 least developed countries.

UK - The Office of National Statistics Social Trends report shows that the top 1% of the population control 23% of the country's cash, property and assets. The richest tenth of the country have total average wealth of £3,954,900 That the poorest tenth of the country had a net wealth below zero between 2006 and 2008, with MINUS £500 to their names after debts were subtracted from their physical and pension wealth. Dorling says the government's latest figures show that in the capital the top 10% of society had on average a wealth of £933,563 compared to the meagre £3,420 of the poorest 10% – a wealth multiple of 273. Another Government commissioned report, showed Britain's wealthiest 10% of the population were almost 100 times richer than the poorest 10%. The economics editor of The Telegraph quotes a report from consultants AT Kearney that the richest 1% in the UK hold some 70% of the country’s wealth. Kevin Cahill's book Who Owns Britain sets out the figures pretty starkly: The UK is 60m acres in extent, and two-thirds of it is owned by 0.36% of the population, or 158,000 families. A staggering 24m families live on the 3m acres of the nation's "urban plot". The average Briton living in a privately owned property has to exist on 340 square yards. The 24 million dwellings, 11% owned by private landlords and 65% privately owned. 10.9 million carry a mortgage of some kind.

Canada - 61 individuals own about 6% of all personal net worth in Canada (which totalled some $2.8 trillion in 2010). In contrast, the bottom 50% of Canadians owns about 3% of all personal net worth. Those 61 individuals therefore own twice as much wealth, as the bottom 17 million Canadians.

Australia
- the wealthiest 20 per cent own 61 per cent of the country's wealth, while the poorest 20 per cent own 1 per cent

New Zealand - 10 wealthiest New Zealanders have total assets of $21.7 billion, the equivalent of 37.5 per cent of the total value of all NZX-listed companies at the end of June.
The 50 wealthiest individuals in both countries in New Zealand has total assets equivalent to 61.3 per cent of the NZX's total value. The top 10 in the NZ Rich List have total assets equal to 11.0 per cent of GDP.

India - The number of Indians who have financial assets of over $1 million, excluding main residences, is 127,000. Population of India 1.2 billion. The wealthiest 100 Indians are collectively worth $276 billion.

Pakistan - The richest 40,000 people in the country have combined income equal to that of the poorest 18 million people. The super rich — the 18,000 who make up 0.001 per cent of the population — earn 180 times as much as the poorest 18 million. Or, to put it in another way, the super rich earn in just two days what it takes the poor to earn in one year.

China - the richest 10 per cent of Chinese controlled 45 per cent of the wealth, while the poorest 10 per cent has just 1.4 per cent.

Singapore - The number of millionaires in Singapore has climbed to its highest level yet at 99,000 last year, according to the report from 82,000 in 2009. Together, Singapore millionaires held about $453 billion worth of financial assets last year, an average of about $4.6 million per millionaire here. About a third of their assets went to property, a third to equities, and another third to cash, fixed income and other financial instruments.(The report defined high net worth individuals as those having investable assets of $1 million or more, excluding primary residence, collectibles, consumables and consumer durables.

Israel
- The richest 20% of Israelis made 40.6% of total household income last year, while the poorest 20% earned only 6.3% of the total.

Chile - Four families in Chile concentrate 47% of the assets of companies quoting in the Santiago Stock exchange. Andronico Luksic; Anacleto Angelini; Eduardo Matte and Sebastián Piñera, whom together made up 9.16% of Chile’s GDP in 2004 and 12.49% of GDP in 2008.

Brazil - The richest 10 percent of the population own 50.6 percent of the country's wealth, while the poorest 10 percent possess only 0.8 percent of the wealth.

France - 133,000 full time employees in the private sector - the so-called very high wage earners - earned more than 215,600 euros a year. One per cent of the population earned more than 500,000 euros a month .The poorest ten per cent earned less than 10,010 euros a year

Africa
- In Africa there exists an elite of about 100,000 Africans who possess a collective net worth of 60% of the continent's gross domestic product in 2008.

South Africa - According to the Naledi Research Paper on the Living Wage, presented to the Cosatu central committee last month, the top 10% of earners receive about 94 times more than the bottom 10%. The poorest 10% share R1.1bn between them while the richest 10% share R381bn, 51% of the total. 40,000 white commercial farmers own 224 million acres of agricultural land.

Swaziland - The royal family consumes about 5 per cent of the annual budget. The king has an estimated personal fortune of US$200 million. The Swazi monarchy is estimated to be wealthier than the country as a whole.

Botswana - Dr Kenneth Dipholo of the Ministry of Finance and Development Planning has said that the richest 10 percent of the population controls 42 percent of the total national income. The poorest of 50 percent of the population share 17.4 percent of national wealth.