MAILSTROM

All that glitters - The yellow brick road

2012-02-01T06:39:00.003Z

All That Glitters

According to various sources total mined gold mined from known history to the end of 2009 amounted to approximately 165,000 tonnes. In 2008 jewellery accounted for 52 percent of the world’s gold; central bank holdings and investments accounted for 34 percent; and industrial gold, 12 percent. The remaining 2 percent was unaccounted for. The price of gold is expressed in dollars but, nowadays but rather than a change in the price of gold leading to a change in the value of the dollar, it’s the other way round. One of the reasons for the recent rise in the price of gold is the current weakness of the dollar. Another is, of course the threat of future economic insecurity and gold, as a product of labour, is still a store of value which, if the fears are realised, is better to be left holding than mere pieces of paper.

From 1850 to 1914 the general price level was stable; there were moderate fluctuations but the prices in 1914 was much the same as it had been 64 years earlier (Between 1850 and 1914 average wage rates went up by nearly 90 per cent, more than keeping up with the steadily rising productivity in industry - but no inflation.) Governments before 1914 knew how to stabilise prices, how to raise them and how to lower them. They knew that the key to the situation is the amount of currency (notes and coins) in circulation. If this is kept in line with the needs of the growth of production, population, etc. prices will be stabilised. If currency is arbitrarily increased prices will go up. If arbitrarily reduced, prices will go down. Before 1914 stability was maintained through the gold standard which closely controlled the issue of currency.

Before the present era of managed currencies, money took the form of some commodity having its own value as a product of labour having its own value in which the values of all other commodities were expressed such as gold and silver which were made into coins by governments (who also issued metallic and paper substitute for it which were exchangeable on demand for the real thing). The function of the money-commodity, gold, is to facilitate the equation of different commodities.For instance, it may require 10 hours of labour time to produce 1oz. of gold, 5 hours for a shirt and 2 hours for a bottle of beer. In this case, the value of a shirt will be equivalent to l/2oz.of gold and the value of a bottle of beer would be equal to 1/5oz. So 1oz.of gold would be equal to two shirts or five bottles of beer, and this is the relationthrough which these commodities will be exchanged, as measured by their value expressed in gold.

Under this gold standard the amount of money in circulation was more or less self-adjusting in accordance with the requirements of the economy for payments. This system was suspended during the First World War and finally ended with the Second. This meant that from then on governments have had to decide how much money the economy requires. Not always an easy task. This government-created, “fiat” money is issued by state-controlled central banks and could be described as being created, if you want to use the term, “from thin air” by them, in effect by governments. In most countries it is introduced into the economy by the central bank buying government bonds from commercial banks of which “quantitative easing” is one form. At the end of WW2 a new system for settling international payments was established based on the dollar. The exchange rate between other currencies and the dollar (and so between the other currencies) was fixed, but, since the dollar was defined as 1/35 oz of gold, gold still played an indirect role as the money-commodity as a standard of price. During the early 1970s this changed dramatically when loss of confidence over escalating costs of the Vietnam War became evident with many countries selling off their dollar reserves in favour of gold. By 1968, the United States's external obligations vastly exceeded the value of its diminishing gold stock. Unable to withstand this pressure the US came off the Gold Standard in 1971 and allowed the fixed exchange rate system that was pegged to the dollar to collapse and abandoned its commitment to pay $35 for an ounce of gold. After that, all currencies floated and, though central banks still retained gold reserves for a while, gold became an ordinary commodity, another precious metal alongside silver and platinum, whose price fluctuations have no effect, either way, on the general price level.

Ron Paul wants to go back to a gold-based currency. The right-"libertarian" types like to return to the gold standard because the idea is to have control of the money supply independent of the state. But the financial industry will itself create money, and in ways that can lead to dangerous crashes. Paul has a correct understanding of what causes inflation and his solution would work to stop it, if that what was wanted. ( Nor has he been a lone maverick voice. Even in 1974 Rees-Mogg of the Times was urging a return to the gold standard). Some politicians and economists are now urging a return to the nineteenth century gold standard in order to get rid of inflation. The amount of notes and coins in circulation in Britain has increased from around 450 million in 1938 to over 19,000 million in 1996, much more than would have been needed because of increases in production and trade. Workers will still of course be faced with the wide range of difficulties the failed policy of "more money" was supposed to help cure in the first place.

It only needs to add that getting rid of inflation is not the answer. Capitalism without inflation, as in the nineteenth century, no more solves working class problems than does capitalism with inflation. Since the U.S. dropped the gold standard in 1971, the price of gold has risen tenfold. But consumer prices have risen only two and a half times (In recent years Paul’s view has been modified to peg currency value to a market basket mixture of commodities in place of simply gold). If the U.S. had instituted a full gold standard in 1971, the result would have been the worst deflation since the Great Depression. Deflation isn't necessarily a good thing for workers. Falling commodity prices mean that employers are under pressure to cut wages, which they did in previous deflationary years. It was wage-cutting that provoked the Great Rebellion, the railway strike, of 1877. Recessions/depressions tend to reduce worker bargaining power. Wages shrank by a quarter in the 1870s and in some industrial states like Pennsylvania by 50 percent.

Many radicals 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 and restricted the money supply. Of course in that era credit in general was extremely scarce. for example, until after World War II, it was hard to get houe mortgages in the U.S. Typically you could only get a mortgage for a short period like 7 years and there'd be a balloon payment at the end. Consumer credit only really developed in the '20s.
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. This is relevant to the issue of the money supply because expansion of credit expands the money supply and so in reality there is no particular reason to tie money to gold.

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 (greenbacks) and they wanted to be able to redeem the debt in dollars worth more than what they provided. By tying the dollar to gold, this would cause deflation, thus raising the value of their dollar-denominated debt. The effects on households dependent on natural resource production, i.e.,farmers, miners and lumbermen, were often more severe. Prices of their products fell by 30 percent to more than 50 percent. And such households still constituted well over half of the population. As in any deflation, anyone who took out a mortgage, including those for farms, mines and sawmills, before or during the decline was punished severely. So the agrarian protests of the era had a basis in real human hardship.

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. 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.

Ron 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 similar banking crises as today. The National Bureau of Economic Research lists 12 recessions totaling 312 months out of the 588 months from 1865 through 1914. Moreover, it was a period of frequent financial crises. There were at least seven national banking panics, with some banks failing and many others suspending withdrawals and payments of checks for some period. Capitalism goes through its boom/slump cycle whatever the basis of the currency. No monetary reform can change that. Socialists have no nostalgia for the Gold Standard. While this may have both advantages and disadvantages to the capitalists as an international trading system revolutionary socialists are only interested in the abolition of all the defining characteristics of the capitalist economy (wages, capital, prices, money, etc) including the paraphernalia of international trade. The answer is not to revert to some earlier stage of capitalism - to go back to the gold standard - but in establishing socialism.

A general who ruled Brazil in the 1970s once said "The economy is doing well, but the people are doing badly." That is a pretty good description of capitalism.

The Yellow Brick Road

"Have you heard of the wonderful wizard, The wonderful Wizard of Oz, And he is a wonderful wizard, If ever a wizard there was"

While many today consider gold an instrument of financial and personal freedom, Frank Baum, author of 'The Wonderful Wizard of Oz' painted it as a villain - the tool of oppression. Baum published the book in 1900, just after the US emerged from a period of deflation and depression. Prices had fallen by about 22% over the previous 16 years, causing huge debt. Farmers were among those badly affected, and the Populist political party was set up to represent their interests and those of industrial labourers. The US was then operating on the gold standard - a monetary system which valued the dollar according to the quantity of gold. A key plank in the Populist Party platform was a demand for "free silver" - that is, the "free and unlimited coinage of silver and gold" at a fixed ratio of sixteen to one. Populists and other free-silver proponents advocated unlimited coinage of the white metal in order to inflate the money supply, This would have increased the US money supply, raised price levels and reduced farmers' debt burdens thus making it easer for cash-strapped farmers and small businessmen to borrow money and pay off debts. Baum's allegory is a critique of the Populist rationale. The Land of Oz, is a microcosm of America and Oz is short for ounce, the measure for gold and silver. Emerald City, its center and seat of government, represents Washington, D.C. The journey to Emerald City corresponds to the Populists effort to acquire power in Washington. The yellow brick road is the gold standard. The brainless Scarecrow represents the midwestern farmers. The Tin Man represents the nation's workers, in particular the industrial workers. The Wicked Witch of the West and the Wicked Witch of the East represent financial-industrial interests and their gold-standard political allies (NY banker J.P.Morgan and JD Rockefeller), the Emerald City of Oz (green-back money is also a delusion). The Wizard is simply a manipulative politician who appears to the people in one form, but works behind the scenes to achieve his true ends through deceit, and even Dorothy’s silver slippers (changed to ruby slippers for more effect in the color movie version) is a symbol of the belief that adding silver coin to gold coin would provide much needed money to a depression-strapped, 1890s America). Oz is full of monetary reform symbolism.

But it also included some utopian hopes.

In the sequel to the Wizard of Oz 'The Road to Oz' Baum has the Tinwoodman explain:
“It must have cost a lot of money,” remarked the shaggy man.
“Money! Money in Oz!” cried the Tin Woodman. “What a queer idea! Did you suppose we are so vulgar as to use money here?”
“Why not?” asked the shaggy man.
“If we used money to buy things with, instead of love and kindness and the desire to please one another, then we should be no better than the rest of the world,” declared the Tin Woodman. “Fortunately money is not known in the Land of Oz at all. We have no rich, and no poor; for what one wishes the others all try to give him, in order to make him happy, and no one in all Oz cares to have more than he can use...
...[later]"Don't they work at all?" asked the shaggy man.
"To be sure they work," replied the Tin Woodman; "this fair city could not be built or cared for without labor, nor could the fruit and vegetables and other food be provided for the inhabitants to eat. But no one works more than half his time, and the people of Oz enjoy their labors as much as they do their play." ”

The next book in the series , The Emerald City of Oz, Baum goes into more detail (inconsistencies notwithstanding) on the money-less economics:
"There were no poor people in the Land of Oz, because there was no such things as money, and all the property of every sort belonged to the Ruler. The people were her children, and she cared for them. Each person was given freely by his neighbors whatever he required for his use, which is as much as anyone may reasonably desire. Some tilled the land and raised great crops of grain, which was divided equally among the entire population, so that all had enough. There were many tailors and dressmakers and shoemakers and the like, that made things that any who desired them might wear. Likewise there were jewellers who made ornaments for the person, which pleased and beautified the people, and these ornaments also were free to those who asked for them. Each man and woman, no matter what he or she produced for the good of the community, was supplied by the neighbors with food and clothing and a house and furniture and ornaments and games. If by chance the supply ever ran short, more was taken from the great storehouses of the Ruler, which were afterward filled up again when there was more of any article than the people needed. Every one worked half the time and played half the time, and the people enjoyed the work as much as they did the play, because it is good to be occupied and to have something to do. There were no cruel overseers set to watch them, and no one to rebuke them or to find fault with them. So each one was proud to do all he could for his friends and neighbors, and was glad when they would accept the things he produced."

A wizard idea!!!

some propaganda

2012-01-31T02:29:00.000Z

Capitalism requires consent. This consent doesn't have to take the form of active support - apathetic or even despairing acquiescence will do. It's the task of supporters of capitalism to sell the system to the mass of people. The mass media are there to tell us what we should think and do. If capitalism solely relied on the support of capitalists to keep it going it wouldn't last too long . It is kept going by the ideas and behaviour of workers. Most of the population passively and sometimes actively participate in their own exploitation. Socialists living in capitalism are, of course exploited but strongly object to being so - and we do all we can to explain to others the nature of this exploitation and the way to end it.

Whenever a story breaks, or significant events are occurring, the media produces “community leaders”, and “representatives” of consumers, or “interest groups” the media claims to function as a forum, representing the views and analysis of “the people”, to represent the divergent views on a particular topic. This claim, however, is undermined by the fact that the media self-selects these “representatives”, and by the fact that more often than not, these representatives are not even vaguely appointed by the people they claim to represent. Given, though, that these “representatives” only exist by and through the virtual world of the media, and only exist through the recognition of power and not through the active involvement of those they claim to represent, they can only present an abstraction of the views they claim to put forward; akin to the abstract “people” of radical bourgeois politics. From the Open University unit, "Science, Technology and Everyday Life, 1870-1950":
"The so-called 'mass media' serve to generate consent in their audiences by representing the real world in ways which confer legitimacy on the social order in which they subsist...Communication is not only about who is talking to whom, and how; it is also about who is not talking to whom and why."

There are today no mainstream media outlets that are not pro-capitalist, is pretty much indisputable. This means that, today, newspapers and news programmes (those read and watched by the working class) are not what they appear and claim to be. Their role is not to enlighten and inform, but to mould public opinion so that it reflects the interests of the capitalist class and the state. "News" is propaganda, not genuine journalism. If you want to know the truth, you cannot rely on the media. We have that on good authority – in fact, on the authority of the more honest newspapers. (The more honest papers are those that are read mainly by capitalists who need reliable information about the world in order to make investment decisions, as opposed to those that are read mainly by workers.)

The media generate a kind of false community, dominated by corporate values and corporate images of the world. To join your fellow humans in this community, all you have to do is surrender your real feelings and values to agree with whatever it is that the media say that other people think. No matter how a person feels about the reality presented by the media, he can still be made to feel that "nobody feels this way but me".

In selecting who can speak, the media exercises power similar to that of the medieval monarch determining who gets to sit in their parliament. Indeed, the modern mass media presents itself as a forum for the people, as the place for representation and for determining legitimacy a third house of parliament, the Fourth Estate. All manner of hangers-on maintain a stranglehold on the state apparatus, while the mass media provides a means of identifying and recognising certain interest groups within society, and constructing the playing field on which political battles are fought out. The media, though, always lies within the hands of the ruling elites, and so ensures that representation remains within the bounds of holding the existing social relations together.

The media are businesses whose job is not just to make profits, but to mould public opinion. But it is intolerable for business in general if any one dictator should come to wield decisive influence. The example of Murdoch’s Fox network in America has “distorted” public opinion so much as to give credence to “right-wing populism” – which threatens to put state power in the hands of ideology rather than true business interests. From a socialist's view, it was equally intolerable that Murdoch should so influence public opinion as to build support for wars, from the Falklands to Afghanistan, and opposition to the class struggle, from the 1980s miners’ strike to the more recent state-workers pensions strikes. In capitalism, propaganda is not carried out by central state institutions but by exclusion from mass media which is monopolised by the owning class:
"Our system differs strikingly from say, Soviet Union, where the propaganda system literally is controlled by the state . . . Our system works much differently and much more effectively. It's a privatised system of propaganda, including the media, the journals of opinion and in general including the broad opinion of the intelligentsia, the educated part of the population" - Chomsky

"The modern mass media is not, as some...like to remark, controlled by corporations; it is corporations. Businesses do not control the car industry; the car industry is big business. Likewise, the media is made up of large corporations, all in the business of maximising profits . . . This immediately suggests that, at the very least, media corporations might have a tendency to be sympathetic to the status quo, to other corporations, and to the profit-maximising motive of the corporate system . . ." David Edwards. Far from some Orwellian vision of state control ITN, the Guardian, and pals are voluntarily "on message" because this is in the long-term interest of their product.

The newspapers and journals we read don't need screaming headlines urging us to choose capitalism—their "news", features and advertising unite in assuming a capitalist world. The TV programmes, films and videos we watch and the radio programmes we listen to are similarly slanted. We are sometimes entertained by sagas from pre-capitalist times, but never stimulated by scenes depicting a possible socialist future. The books we read, the movies we watch are overwhelmingly non-political, which means they carry the covert message: "Don't even think about changing the system - better still, don't even think there is a system." Our imagination is not invited to venture no further than the bounds of private property society.

The camouflaging of class rule by the media generates endless hypocrisy, and hypocrisy is not one of the more appealing character traits. But, as poet Matthew Arnold remarked, “hypocrisy is the tribute that vice pays to virtue.” The prevalence of hypocrisy is a sign that it is no longer possible openly to justify certain evils. Tabloids and ruthless reporters pre-date Murdoch’s era by many decades. In Citizen Kane, Orson Welles plays the role of newspaper owner Charles Foster Kane, who he models on the real-life tycoon William Randolph Hearst. In the movie we see the obscene amount of wealth and power concentrated in the hands of Kane and how he uses his network of newspapers to influence public opinion and politics. In the first part of the twentieth century the American writer and journalist Upton Sinclair drew attention to the corrosive influence of advertising that led newspapers to adapt content to suit powerful sponsors and encourage editorial self-censorship. Sinclair’s book The Brass Check (1919) was a scathing attack on a monopolistic press, in which he said that commercial journalism had become “a class institution serving the rich and spurning the poor,” with the task of “hoodwinking of the public and the plunder of labour”.

Take away Murdoch and another shark swims into his place; topple his empire, and another tycoon rises up. It is foolish to call for a reformed journalism but leave in place the profit motive that drives tabloid excesses. The truth is that the main job of the mass media is not to report the facts to a concerned, democratic citizenry, but to make profits. The working class generally has little interest in state policy decisions because they feel that they have no real say over it anyway. And they feel that not because they’re stupid but because it’s true.

How the plutocrats took power

2012-01-30T09:26:00.004Z

For many like Ron Paul, a belief in the abstract and nebulous "libertarianism" is closely linked to the myths surrounding the origin of the Constitution and the ideals of the Founding Fathers of America. But far from being a revolutionary event that encouraged a genuine development of democratic values, the War of Independence was a strictly conservative affair. The colonial rebellion was not the work of enraged peasants but of landed "country gentlemen". It is clear that the real beneficiaries of the break with Britain were the landowners and wealthy traders who were able to expand their own wealth without interference. Although Paine’s call to arms, based on abstractions and ideals, appealed to the ordinary person, all the material benefits went to the wealthy.

"The Founding Fathers did lead the war for independence from Britain. But they did not do it for the equal right of all to life, liberty, and equality. Their intention was to set up a new government that would protect the property of slave owners, land speculators, merchants, and bondholders." Howard Zinn

Despite pretensions of being “enlightened” – sweeping aside monarchy, aristocracy and the established church – the new republic was never designed to be anything other than an oligarchic state. The political institutions and Constitution constructed an array of checks and balances motivated by paranoia, suspicion of central government power that laid the foundation for laissez faire economics.

The desire to protect and then extend private property rights led to a type of liberty intended to allow the pursuit of individual aims and wealth unconstrained by government interference. To those who took up the reins of power, government was to be judged not by its ability to promote prosperity but by its capacity to leave people alone to pursue private ends. The principle that personal opportunity should be maximised reflected the Puritanism and the Protestant work-ethic that saw the acquisition of money as the just result of hard work and the Lord’s blessing.

The Founding Fathers substituted the abstract principles that “all men are created equal” and that power is derived from “the will of the people”. They adopted a definition of “the people” which excluded women, non-landowners and slaves. Those architects of the Declaration of Independence – the land and property owners – were quick to build a system of government based on the division of power that would guard against the “excesses of democracy”. The richer property owners were afraid that, as they were not themselves in the majority, the less well-off would vote to take away their property and arrangements (restricted franchise and/or indirect election) were made to keep power out of the hands of the majority. The president was an elected monarch [see http://www.historytoday.com/frank-prochaska/american-monarchy]

By having two different houses of Congress, a Senate and a House of Representatives, places an obvious obstacle to simple majority rule. There are 435 Representatives and 100 Senators. 51 Senators can block the majority rule. Moreover, Senators are elected for six years instead of the two for which Representatives are elected. The electoral college to elect the president operates intentionally in opposition to majority rule in this same way. In a system of electing the President by mere simple majority, a candidate or party could win by appealing to 51% of the voters. The electoral college serves as a partial safeguard against those who might be able to find and win over a majority. The national popular vote is not the basis for electing a President or Vice President. Since 1944 Gallup Polls have found a majority of Americans have continually expressed support for an official amendment of the U.S. Constitution that would allow for direct election of the president.

Ron Paul like the present White House incumbent and the other aspiring candidates remain indifferent to the concept of majority democracy. He and others are complicit in the camoflage of plutocracy by creating the form and appearance of popular government with only a minimum of substance.

Among the people there grew the feeling that the revolution against the British had been fought for nothing.

Whisky Rebellion.

"Small farmers also protested that Hamilton's excise effectively gave unfair tax breaks to large distillers...Small distillers believed Hamilton deliberately designed the tax to ruin them and promote big business" - Sound familiar?
16,000 armed militiamen that crushed the rebels were led in person by two principal Founding Fathers, President George Washington and Treasury Secretary Alexander Hamilton, the author of both the central bank and the whiskey tax legislation.(After the tax drove small producers out of competition, Washington went into the whiskey-distilling business, becoming by the time of his death the largest whiskey-entrepreneur in Virginia, if not the nation.)

Shays Rebellion

"Daniel Shays was a poor farmhand from Massachusetts when the Revolution broke out joined the Continental Army ... In 1780, he resigned from the army unpaid and went home to find himself in court for the nonpayment of debts. He soon found that he was not alone in being unable to pay his debts, and began organizing for debt relief...Other Central Massachusetts towns also played prominent roles in the rebellion including Shrewsbury, which supported a staging area for a large march of 400 individuals on the Worcester courthouse in 1786 in an attempt to block the foreclosure of mortgages" Sound familiar?

Shays’ Rebellion was put down by a smaller mercenary army, paid for by well-to-do citizens who feared a wholesale attack on property rights.

"... the uprising was the climax of a series of events of the 1780s that convinced a powerful group of Americans that the national government needed to be stronger so that it could create uniform economic policies and protect property owners from infringements on their rights by local majorities...These ideas stemmed from the fear that a private liberty, such as the secure enjoyment of property rights, could be threatened by public liberty - unrestrained power in the hands of the people. James Madison addressed this concept by stating that "Liberty may be endangered by the abuses of liberty as well as the abuses of power."

By 1700, three-fourths of the acreage in New York belonged to fewer than a dozen persons. In the interior of Virginia, seven individuals owned over 1.7 million acres. By 1760, fewer than five hundred men in five colonial cities controlled most of the commerce, shipping, banking, mining, and manufacturing on the eastern seaboard. In Colonial America, the rich were getting richer and the poor were getting much poorer. In those same years, the poor--those who owned no property--represented 14% in 1687 and 29% in 1770. In 1687 in Boston, the top 1% owned about 25% of the wealth. By 1770, the top 1% owned 44%. The Founding Fathers were the 1% and the constitution was to protect their self-interest and to stop the 99% gaining any benefit from the American revolution. George Washington was worth more than half a billion in today's dollars. For full figures of individual Founding Father wealth see http://www.rethinkingschools.org/static/publication/roc2/sla2roc2.pdf

Samuel Adams:
"The Utopian schemes of leveling, and a community of goods, are as visionary and impractical, as those which vest all property in the Crown, are arbitrary, despotic, and in our government unconstitutional."

"[The Framers of the Constitution]... had no wish to usher in democracy in the United States. They were not making war upon the principle of aristocracy and they had no more intention than had the Tories of destroying the tradition of upper-class leadership in the colonies. Although they hoped to turn the Tories out of office, they did not propose to open these lush pastures to the common herd. They did believe, however, that the common people, if properly bridled and reined, might be made allies in the work of freeing the colonies from British rule and that they - the gentry - might reap the benefits without interference. They expected, in other words, to achieve a 'safe and sane' revolution of gentlemen, by gentlemen, and for gentlemen." John C. Miller Origins of the American Revolution.

Most of the population consisted of poor freeholders, tenants, and indentured hands (the latter trapped in servitude for many years). A typical farm family might have a large plot of land but little else, surviving in a one-room house or log cabin, no barns, sheds, draft animals, or machinery. The farmer and his family pulled the plow. Small farmers were burdened by heavy rents, ruinous taxes, and low incomes. To survive, they frequently had to borrow money at high interest rates. To meet their debts, they mortgaged their future crops and went still deeper into debt, caught in that cycle of rural indebtedness which today is still the common fate of agrarian peoples in this and other countries. It tended to cause a community-oriented culture to arise on farms or in towns. Their concept of independence was associated with inter-dependence and cooperation--all for the common good. Women worked with men, families traded labor and animals. In this culture of mutual concern and mutual obligation, working class people took care of one another. They shared common values and interests, completely different from the values of a market-driven approach to life. The wealthy class--shopkeepers, lawyers, bankers, speculators, commercial farmers--had adopted a completely opposite way of life: every person for himself. The capitalist world view of the wealthy class saw the community as a system of exchange between producers and consumers, the moneyed and workers. The holy of holies for the merchant class was the market. According to the view of the merchant class, the state is to be controlled by elites or "better people" who decide what is best for the "common people." Government's role is to protect private ownership. The state's only role is to assure that the impersonal market system runs smoothly. This requires that the government use violent force when it becomes necessary to protect personal property and the rights of capitalists over workers.

Alexander Hamilton at the Constitutional Convention said, “All communities divide themselves into the few and the many. The first are the rich and well born, the other the mass of the people. … The people are turbulent and changing; they seldom judge or determine right. Give therefore to the first class a distinct, permanent share in the government.”

Those who argue that the Founding Fathers were motivated by high-minded ideals ignore the fact that it was they themselves who repeatedly stated their intention to create a government strong enough to protect the "haves" from the "have-nots". They gave voice to the crassest class prejudices and at no time deny the fact that their concern was to thwart popular control and resist all tendencies toward class "levelling". Their "checks and balances" were chiefly concerned with restraining peoples' power and maintaining their own.

To talk of elitist power today as something new and forget its roots and actually praise the oppressers as spokesmen for liberty and treat their imposed laws under the constitution as admrable achievments is to forget actual real history and fall victim to propaganda and ruling class ideology.

send in the troops

2012-01-29T04:17:00.001Z

Further to previous post, Mailstrom reads

"Hundreds of soldiers from 3rd battalion The Parachute Regiment spent last week learning how to contain and arrest "rioters" in a series of exercises mirroring last summers violence. Defence sources have confirmed that if violence were to return to British cities, especially during the Olympic Games, the Paras would be "ideally placed" to provide "short-term" support to police forces"

"As well as 3 Para, the Army has another unit known as the "Public Order Battalion", also trained to deal with rioting, bringing the total number of troops to around 1500."

Crowd control - Derry, 30 January 1972

War crimes by 3rd Para in Falklands
http://www.independent.co.uk/news/falklands-war-crimes-claim-mod-investigates-allegations-that-paras-shot-argentine-prisoners-1540755.html

What is Democracy?

2012-01-28T08:15:00.003Z

Democracy is one of those carelessly uttered words (like freedom, peace, love, justice.) Democracy is a word that is mis-used, over-used, ill-defined and has been hijacked by governments and elites to deliberately misinterpret their actions and so deceive the electorate. The word "democracy" originates from the Greek and means ‘power of the people’. In the "largest democracy in the world", India, how do the majority of the population on $2 or less a day consider they are being represented? Electorates worldwide haven't had the true experience of involvement, of having had their voices heard, at any significant level to have resulted in a culture of expectation of inclusion in the various processes of so-called democracy. Decisions have long been made for people not by people, electorates distanced from their representatives, decisions made with no consultation process and "leaders" believing they have been selected to take the reins and make all decisions on behalf of the voters. The capitalist system may have nominally democratic institutions, but it relies upon working class compliance, passivity and lack of involvement in the process to carry out its worst and most illiberal functionings. There is the old nationalist lie that we are one country, one people, working together for a common interest. This ideology allows politicians to present us as if we have one common interest. Nationalism allows the politicians to limit democratic choice on the grounds that there is only one national interest. The “national interest” is in fact that the interest of the capitalist class of a country, not of its population. The government is implementing policies for which no one voted, or would vote for. No one voted to cut care services for the old and the disabled. No one voted to close hospital departments or to delay repairing schools or to close libraries and sports facilities or to reduce rubbish collection. People getting what they didn’t vote for also shows that capitalism is incompatible with democracy as an expression of “the people’s will”. This is not because there are no procedures in place for people to decide what they want, but because the way the capitalist economy works prevents some of these decisions being implemented. Capitalism is not geared to doing what people want and no amount of making the decision-making process more formally democratic can alter this. It is the continual boast of modern politicians that we live in a democratic state. When they say “we” they mean, of course, the ruling class. But the so-called democracy conferred on the working class is not a semblance even of the real thing.

When and where, if ever, was a population last asked how they would define democracy? We, the people, in countries large and small, are told that we have democracy. We are told this by leaders who say we should trust them, who keep information from us because that’s in our best interest, who deliberately lie to us, who can have us stopped and searched in the interest of national security, who have us watched night and day in our town centres, who listen in to telephones, tap into e-mails conversations, who have access to more and more of our personal information, bank details etc., who can put blocks on our access to the internet, who have centralised computer records to use as they choose, who can rein us in and let us out with special measures, who decide whether we can show dissent. And they call this democracy. The years of battering and enforced passivity has come to mean that for most of the working class the idea of them being in charge of affairs is inconceivable. The most damaging thing to the cause of true democracy is the repeated assurances that what we have nowadays is democracy and has created in many people's minds that democracy is not all that great. Our masters, of course, wouldn't want it any other way. "Democracy" as the kind of representative system we have today where, every once in a while, we give the politicians a blank cheque to do what they want, or can get away with is a charade. The party system will be eventually exposed as a fraud, consciously practised by the ruling class in their own interest and future generations wil marvel that a working class, sunk in poverty and anarchy, could forget, even for a moment, their own wretchedness, while they voted this way or that on questions that concerned their masters alone.

“It’s a truism, but one that needs to be constantly stressed, that capitalism and democracy are ultimately quite incompatible.” explained Noam Chomsky. A system so stacked in favour of a few over many can’t be seen as just. How has this crumbling edifice called democracy managed to stand for so long? “Nothing’s perfect,” people say. No, but how long do you wait before you pull a rotten tooth? Chomsky comments elsewhere that "Propaganda is as necessary to bourgeois democracy as repression is to the totalitarian state." The purpose of both to keep control.

Many people imagine that a state run on the lines of the American republic is a democratic state, that the institutions of such a State are democratic institutions, that the spirit of such a state is the democratic spirit, and that the philosophy of such a State – the “Rights of Man” is the democratic philosophy. Many people would argue that Britain (and the USA ) is a democracy and that we all benefit from living in a democratic society. By this they would probably mean the regular holding of elections to parliament and local councils, the freedom to organise political parties, a press which is not beholden to the government, and the rule of law. If people object to the policies of the government or a particular MP, they can vote them out of office. If they oppose a specific action by a local council, they can set up a protest group and hold demonstrations, without the fear of being carted off to prison just for voicing their views. We are told that we live in a "democracy" in which we are free to choose what kind of society we live in. But the most important of all political decisions – what the community produces – is never subjected to any kind of democratic process. Instead the city brokers merely decide which commodities will deliver the greatest or most reliable profits. In other words these decisions are made by a tiny elite minority in the interests of an even smaller minority. In capitalist society the only ‘choice’ voters have is who will decide how taxes are distributed to create and maintain the state infrastructure – armies, police, road, rail, law, health and social security system and, of course, the education system. Even this choice is only ‘given’ to the people once every five years between two political parties with no important differences in ideology. And this is political democracy?

Socialists have no illusions about the democratic credentials of the politicians of the Left, the Right or the Centre. What the capitalist class, and the political parties that serve that class, call democracy is a contrived form of consensus in which the political parties conspire to ensure that the maximum number of people accept a system of law which guarantees a minority class in society the legal right to own and control the means of life of the great majority. To achieve and maintain that system of Law – and the Order that ensures the right of that minority to exploit and impoverish the majority – capitalism must have political control of the state machine. A vital part of the process that maintains the illusion of democratic choice is the power to confine political knowledge – and, thus, political options – to those parties whose policies are firmly rooted in an acceptance of capitalism.

For power to be lodged in the hands of the people does not mean merely that they are to have the widest possible franchise and equal voting power. It implies that the people are to have complete control of all social institutions, the ordering of all social activities, the domination of the whole social life. Such a condition of affairs presupposes at the very outset the ownership by the people of all the means of life, all the social products. There can be no other foundation for democracy than this common ownership of all the means of life, for where these fall into private possession social distinctions at once spring up, the owners become dominators. Real democracy - a social democracy - involves far more. The problem is that under a capitalist system there is a built-in lack of democracy, which cannot be overturned or compensated for by holding elections or permitting protest groups.

It is true that capitalism needs a minimum of democracy since it's the least worst form of government for the system. The alternatives of dictatorship or rule by experts carry the danger that those who control the state might develop sticky fingers and help themselves to too large a share of profits. Better, for the capitalists, to have alternating governments dependent on their ability to retain some degree of popular support. This means that democracy under capitalism is reduced to people voting for competing groups of professional politicians, to giving the thumbs-up or the thumbs-down to the governing or opposition party (or parties). Political analysts call this the "elite theory of democracy" since under it all that the people get to choose is which elite should exercise government power. This contrasts with the original theory of democracy which envisages popular participation in the running of affairs and which political analysts call "participatory democracy". This is the sort of democracy socialists favour but we know it's never going to exist under capitalism. The most we will get under capitalism is the right to vote, under more-or-less fair conditions, for who shall control political power—a minimalist form of democracy but not to be dismissed for that since it at least provides a mechanism whereby a socialist majority could vote in socialist delegates instead of capitalist politicians. The vote they were compelled to give, though they made a virtue out of necessity and said they gave it because they loved the principles of democracy. But no matter how they got them, the workers have far more votes than their masters. With the knowledge of their slave-position and the courage to organise, these votes can be used as the means to their emancipation. The capitalist class cannot abjure what they have established. The vote was given to secure their own domination; if they discard it they lose control and have no sanction to govern. By constitutional methods the workers can win their freedom; they have no need to go outside the constitution until they finally destroy it. So the party system together with the franchise – established because they promised stability – pave the way for working-class victory.

For socialists the rule of government can never be democratic. Though it may include some incidental functions arising from the needs of people the main work of the state is the running of class-divided society; a system of economic exploitation. In the main governments work for a privileged section of society. They make the laws which protect the property rights of a minority who own and control natural resources and industry. These are the means of life on which we all depend but most of us have no say in how they are used. Behind Parliament or Congress, governments operate in secret. They are part of the division of the world into rival capitalist states. With the back-up of their armed forces they pursue national capitalist interests. Though the politicians who run it may be elected, the state is the opposite of democracy. Multinational corporations with massive economic power make the decisions on what should be produced for the markets for sale at a profit. Through corporate authority they decide how goods should be produced and the conditions in which work is done. In fact, though, there is a sense in which the government does not run the system at all - rather, the capitalist system runs the government, by limiting the actions that can be taken. The capitalists and their governments can propose what they like, but it is the capitalist economy that disposes. Raising of interest rates, increased unemployment, devaluation - these may not be what governments want to do, but may well be what they are forced to do because capitalism leaves them no choice. Again, this is the opposite of democracy. This does not mean that socialists equate dictatorship and bourgeois democracy. Within the latter we are free to organise politically and to develop our support to the extent where we can eventually overcome the embargoes and impediments that capitalism’s restricted democratic forms impose on us, whereas in the former any Socialist work is necessarily clandestine and can invoke severe penalties. What we can equate is the hypocrisy of bourgeois politicians, who rightly condemn those capitalist dictatorships where political freedom is denied and yet are willing participants and vociferous defenders of a form of capitalism wherein financial impediments exist that make a mockery of real democracy.

The socialist sympathises with aspirations to political democracy. World socialists applaud those workers around the world who fight at massive risk to themselves for basic civil liberties and trade union rights, for the freedom to hold meetings and participate in free elections. The fight for a measure of democracy world-wide is an essential part of the struggle for world socialism. After all, if workers are not able to fight for something as basic as the vote, they are unlikely to be able to work for the transformation of society from one based on production for profit to one based on production for human need. It is true that the vote, together with other hard-won rights such as the rights of assembly, political organisation and free expression, are most important. But can the act of electing a government result in a democratic society? A genuine, participatory democracy is part of the solution but is not the solution on its own. As socialists, we do not regard political democracy in itself as sufficient to emancipate humanity. But we do recognise that it provides by far the best conditions for the development of the socialist movement. That is why we wish those well to all those struggling for political democracy throughout the world. The concessions and the elbow room that have been won in capitalist democracy are important and of value to working people. Rights to organise politically, express dissension and combine in trade unions, for example, are valuable not only as a defence against capitalism, but from a socialist viewpoint are a platform from which socialist understanding can spread, while the right to vote the means by which socialism will be possibly achieved.
Rosa Luxemburg wrote that democracy is indispensable to the working-class “because it creates the political forms which will serve the proletariat as fulcrums in its task of transforming bourgeois society” But democracy in itself cannot solve a single problem of the working class. Democracy for the working class can only be consolidated and extended to the extent that the working class adopts a socialist standpoint. To renounce socialism so that democracy may be defended, means ultimately the renunciation of both socialism and democracy.

At the same time we must recognise that genuine democracy is more than these freedoms and the right to vote. While "one person one vote" is an essential ingredient of democratic society, democracy implies much more than the simple right to choose between representative of political parties every five years. The Chartist movement, in the 19th century, saw that gaining the right to vote was meaningless unless it could be used to effect "change". But today exercising our democratic right to vote for a conventional political party does not effect change. It amounts to little more than making a selection between rival representatives of power and class interest. If we cannot have democracy under the present social system, at least we may have men and women imbued with the democratic spirit. Indeed, every Socialist must be so imbued. In the light of this spirit he has faith in the capacity of the whole people to control the social system as a democracy. The realisation that genuine democracy cannot exist in capitalist society does not alter the fact that the freedoms already secured by struggle can be turned against our masters. The right to vote, for instance, can become a powerful instrument to end our servitude and to achieve genuine democracy and freedom. Working people with an understanding of socialism can utilise their vote to signify that the overwhelming majority demand change and to bring about social revolution.

At first sight, this suggestion of literally everyone taking part in social decisions may seem as unrealistic. Surely, it is said, these matters have to be left to the experts, and surely modern populations are far too large for active participation by everyone? Political theorists and political philosophers. They think the point so obvious that they state them far more often than actually arguing for them. Yet they are not obvious. In view of the demonstrated failure of legions of experts and government advisers to solve any of the major problems of civilisation, the less said about expertise the better. How can millions of people all have a say in running society?

Marx’s theory of socialist revolution is grounded on the fundamental principle that “the emancipation of the working class must be the work of the working class itself”. Marx held to this view throughout his entire forty years of socialist political activity, and it distinguished his theory of social change from that of both those who appealed to the princes, governments and industrialists to change the world for the benefit of the working class (such as Robert Owen or Saint Simon) and of those who relied on the determined action of some enlightened minority of professional revolutionaries to liberate the working class (such as Blanqui and Weitling). Marx's conception of what a fully democratic system would be like seems to had been influenced by events in France. Here's how he described the Paris Commune of 1871 which he held up as an example of how the working class should exercise political power once they had won control of it:
"The Commune was formed of the municipal councillors, chosen by universal suffrage in the various wards of the town, responsible and revocable at short terms. The majority of its members were naturally working men, or acknowledged representatives of the working class. The Commune was to be a working, not a parliamentary body, executive and legislative at the same time..In a rough sketch of national organization, which the Commune had no time to develop, it states clearly that the Commune was to be the political form of even the smallest country hamlet, and that in the rural districts the standing army was to be replaced by a national militia, with an extremely short term of service. The rural communities of every district were to administer their common affairs by an assembly of delegates in the central town, and these district assemblies were again to send deputies to the National Delegation in Paris, each delegate to be at any time revocable and bound by the mandat imperatif (formal instructions) of his constituents."

The democratic organisation of all people as citizens of the world would need to operate through different scales of social co-operation. Locally, in town or country, we would be involved with our parish or neighbourhood. Even now, there are many thousands of men and women throughout the country who work voluntarily on parish and district councils and in town neighbourhoods for the benefit of their communities. But these efforts would be greatly enhanced by the freedoms of a society run entirely through voluntary co-operation. Such local organisation would be in the context of regional co-operation which could operate by adapting the structures of present national governments. Whilst some departments such as Inland Revenue and the Treasury, essential to the capitalist state, would be abolished, others like Agriculture and the Environment could be adapted to the needs of socialist society and could be part of regional councils and would assist in the work of implementing the decisions of regional populations. With the abolition of the market system, communities in socialism will not only be able to make free and democratic decisions about what needs to be done they will also be free to use their resources to achieve those aims. Communities will be free to decide democratically how best to use those resources. Small units could be run by regular meetings of all the workers. In the cases of large organisations these could be run by elected committees accountable to the people working in them. In this way, democratic practice would apply not just to the important policy decisions that would steer the main direction of development, it would extend to the day-to-day activities of the work place.

These days developments are now taking place which relegate phones and TVs to the museums along with the stone-age ax. Even the feeblest imagination should be able to grasp the implication for democracy. This potential boon to humankind has itself called forth instruments which could, in a different framework, be of untold benefit. Such information and communications technology gives the opportunity for the population to keep themselves better informed and to take a more active role in decisions than at any time since the small city-states of ancient Greece. Information must flow freely, so all can have an opportunity of reaching a decision, of judging the performance of delegates and appointees, of deciding to challenge the actions of one body in a higher authority; and in real democracy, the higher authorities are those bodies which contain more members of the community concerned. Everyday life must be the signalling system that lets people know what their fellows want, the way of co-ordinating votes and decisions. A society of common ownership would have no need of constricting decision-making. Democracy would be an everyday process. When we own all the wealth in common we will have structures to ensure that we retain control of all decision-making levels where we feel we have need to involve ourselves and intervene. The more people can exercise a say in those actions, the more democratic the process becomes. Our aim of a democratic society is a practical possibility.

Democracy needs no boastful big leaders with egos to polish, no self-important experts and specialists linked to large corporations. Democracy needs no rallying cries of flag-waving nationalism. Democracy, in essence, is simple and easily understood. Democracy speaks the whole truth, reveals all the evidence, enables informed discussion and decisions and requires inclusion for all in dialogue. Crucial to the question of democracy is not just the ability to make decisions about what to do but also the powers of action to carry out those decisions. Politically for socialists it is the heartbeat of every activity.

There is a view of some of our critics that envisages only a minority-led revolution, with an active minority leading a mass of merely discontented but not socialist-minded workers. Even if such a revolution were to succeed it would not, and could not, lead to socialism . They are not thinking, as we are, in terms of a majoritarian revolution, one involving the active and democratic participation of a majority of the population. Even if such a revolution were to succeed it would not, and could not, lead to socialism. For socialists in the WSM, democracy is not an optional extra or simply a means to an end. It is part of our end. Unless a majority of industrial and white collar workers want socialism and organise themselves without leaders to get it then socialism is impossible. On the other hand, if they do want it, nothing can stop them getting it, not even a hypothetical abolition of political democracy by a recalcitrant capitalist government. No government can continue to govern in the face of active opposition from those they govern. Faced with the hostility of a majority of workers (including, of course, workers in the civil and armed forces, as well as workers in productive and distributive occupations), the capitalist minority would be unable, in the long run, to enforce its commands and the workers would be able to dislocate production and transport. Even if a pro-capitalist minority somewhere were to try to prevent a change of political control via the ballot box, the socialist majority will still be able to impose its will by other means, such as street demonstrations and strikes. But we doubt that it will come to that.

Democracy is not just a set of rules or a parliament; it is a process, a process that must be fought for. The struggle for democracy is the struggle for socialism.It is the struggle for an idea, a belief that we can run our own lives, that we have a right to a say in how society is run, for a belief that the responsibility for democracy lies not upon the politicians or their bureaucrats, but upon ourselves. We want democracy to extend to all spheres of social life. For us that’s what socialism is – the common ownership and democratic control of the means of life by the whole community. But genuine democracy will not be achieved by relying on economists or other supposed experts to design it.

William Morris wrote about democracy in a passage he explains the mechanism of democracy :
“Said I ‘So you settle these differences, great and small, by the will of the majority, I suppose?’
‘Certainly,’ said he; ‘How else could we settle them? You see in matters which are merely personal which do not affect the welfare of the community – how a man shall dress, what he shall eat and drink, what he shall write and read, and so forth – there can be no difference of opinion, and everybody does as he pleases. But when the matter is of interest to the whole community, and the doing or not doing something affects everybody, the majority must have their way . . . in a society of men who are free and equal – the apparent majority is the real majority, and the others, as I have hinted before, know too well to obstruct from mere pigheadedness; especially as they have had plenty of opportunity of putting forward their side of the question.’ ”

Socialism and democracy are complementary; more than complementary – indivisible. In the sense that a democratic society can only result from free, conscious choice, it is a by-product of freedom. But in both a social and a political context freedom can only exist as a by-product of democracy. Whichever way round it is will not matter, when it is thriving in that community yet to be established, where though it still rains, we still quarrel and new problems confront us every day – we have learned to accept that, just occasionally, we may be wrong but rejoice in the fact that tomorrow we retain the incontrovertible right to be wrong again. Democracy can not be left to mature on its own like a good wine but needs to breathe out of the bottle, kept fresh by continual practice. Socialism will involve people making decisions about their own lives and those of families, friends and neighbours. This will not just be the trappings of democracy but the real thing - people deciding about and running their own lives, within a system of equality and fellowship.

The World Socialist Movement does not intend playing into the hands of the global ruling class and their political mouth-pieces. We don't intend making it easy for them to treat world socialism as an "undemocratic" threat. Where it is available to workers we take the viewpoint that capitalist democracy can and should be used. But not in order to chase the ever diminishing returns of reforming capitalism. Instead we see democracy as a critically important instrument available to class-conscious workers for making a genuine social revolution. And in the process of making a revolution the really interesting work can start of course: that of reinventing a democracy fit for society on a orld-wide human scale. A democracy that is free from patronage, power games and the profit motive.

protect the games

2012-01-28T02:22:00.001Z

Home Secretary Theresa May said disruption from [occupy] protests was one of the biggest threats to the Olympics which begin in July and wants London 2012 organisers (LOCOG) to use "all available" powers to remove equipment and encampments, rapidly backed up by police.

Ground-to-air missiles will be deployed to protect the London Olympics. The MoD has offered 3,000 soldiers, and another 2,000 in reserve

Apart from 21,000 UK security , USA will be deploying a 1000 of their own men.

The security budget currently stands at £600 million but the overall spend could total more than £1.1billion.

The Madness of Two Worlds

2012-01-26T05:54:00.001Z

If you are poor:-

Leandro Andrade is serving a life sentence in California for stealing five videotapes from a K-Mart. He was convicted under the state's three strikes law, after convictions for petty theft, burglary, and possession of marijuana. Justice David Souter noted that Andrade "committed theft of trifling value...with no violent crimes against the person."

-Sisters Jamie and Gladys Scott received double life sentences in 1994 for an $11 armed robbery, the first criminal for either of them. They spent 17 years in jail.

As of 2003 in California there were 344 individuals serving sentences of 25 years or more for shoplifting as a third offense, in many cases after two non-violent offenses.

If you are the rich:-

The Savings and Loan fraud cost the nation between $300 billion and $500 billion, about 100 times more than the total cost of burglaries in 2010. The financial system bailout has already cost the country $3 trillion.

Goldman Sachs packaged bad debt, sold it under a different name, persuaded ratings services to label it AAA, and then bet against it by selling it short. Other firms accused of fraud and insider trading were Morgan Stanley, Bear Stearns, Bank of America, Countrywide Financial, and Wells Fargo.

New York Times reported in 2008 that the Justice Department had postponed the bribery or fraud prosecutions of over 50 corporations, choosing instead to enter into agreements involving fines and 'monitoring' periods.

"The financial system led us into the crisis and it will lead us out." -- Goldman Sachs chairman Lloyd Blankfein.
"Western-style private enterprise...will lead the world out of the mess it led the world into." -- Chicago Tribune.
"If capitalism is perceived to not be working in America...it's because the system isn't capitalist enough." -- Rachel Marsden

From here

conspiracy or science

2012-01-25T08:19:00.002Z

Some people foreswear the genuine wonder of scientific discovery and evidence-based knowledge in favour of fantasies, rumours and conspiracy theories conjured up by charlatans who from time immemorial have always preferred the tall story to the telling fact.Those who believe one conspiracy theory are more likely to believe others. The conspiratorial world-view is not helpful in promoting an understanding of modern society and is itself, in large part, a product of the times we live in. Are people wrong to distrust the scientific community, and therefore believe every maverick or eccentric with a theory that same community has loudly disowned? Generally yes, but when it is well known that science chases the money whereas the money never chases the science it doesn’t like, it is not hard to see how these conspiracy theories get started.

Major events cannot, in the popular mind, have trivial causes, because our world-view cannot allow it. Believing ourselves to be rational creatures in a supposedly ordered and rational universe, we shy away from the hideous tyranny of randomness, that force of Nature which defies our control and thus denies us our sense of meaning and ‘place’. Thus, JFK, who ninety percent of Americans believe could not possibly have been offed by one lone nut with a rifle and some personal issues but rather good eyesight. Princess Diana didn’t die because a driver got drunk, it was all a vast conspiracy involving the top echelons of power. Ditto John Lennon that the blame is again placed upon the "lone nutter" who had been receiving treatment for paranoid schizophrenia for his entire life since childhood but rather Chapman was being used as a "Manchuran Candidate" by Richard Nixon. Ditto 9/11, which clearly couldn’t have been simply the work of a few terrorists who got very, very lucky (but this is not to deny the possibility that Bush may have indeed connived at the attacks by refusing to act on intelligence warnings. But we await the evidence)

However, people don’t fall for conspiracy theories because of some sense of proportionality, but because they know , like the proverbial mushrooms, we are kept in the dark and fed on shit. Put any sentient, self-aware animal in an environment where they can’t trust their senses, and pretty soon they’ll stop functioning ‘rationally’. We do indeed live in strange times. Mass starvation when the world produces abundance. Wars constantly rage across the globe yet everyone says they want peace.

It is no wonder that people look for irrational explanations for seemingly irrational problems. Conspiracy theorists take the view that such a complex organism as modern world society must be controlled from the top – someone, somewhere must be pulling the strings. What is particularly unfortunate about conspiracy theories is not that they foster a view of the world as hopelessly in thrall to some shadowy elite with god-like power, because this is largely true and they are called the capitalist class. What it incorrectly encourages is the much more damaging idea that this elite is actually much cleverer than the rest of us. The central mistake of conspiracy theorists is the notion that anyone is really in control of anything. At the heart of Marxian economics is the concept the capitalist “anarchy of production” where commercial enterprises produce things with just only their own profit in mind oblivious to the needs of other firms or the limits for their particular market – all without an overall external controlling force. Competition is built-in to capitalism. Marx produced the evidence the economy being essentially beyond the control of politicians, bankers and economists. Yet we are presented ith myths of the inter-connectedness of some sections of the capitalists class (the Rothschilds and Rockefellers, perhaps) or the “mystical” power of the banks being able to create money out of thin air, that every event (even contradictory ones) is under political control to the last detail. Most conspiracy theories are really believed not by those who come into closest contact with the assumed conspirators but by those who are typically furthest away from them – the disenfranchised and dispossessed such as the US militiamen polishing their guns in the hills of Montana.

The feeling of helplessness in the face of uncontrollable forces sow the seeds for conspiracy theories to flourish. A socialist understands that we are in the grip of uncontrollable impersonal economic forces, the market, and knows that this grip can be broken only by establishing socialism but non-socialists seek an explanation in the mysterious hand of God, the Stars, Fate or Luck. Some non-socialists cannot accept the view that our lives are controlled by the impersonal forces of the market and find it easier to think that these forces are personal; in other words, they personalise the capitalism and you have some shadowy group – the financiers, the Jews or the Illuminati – controlling the world and manipulating events.

It is easier to grasp: that some group of people are deliberately causing these events rather than their being the result of impersonal forces acting as if they were forces of nature. In religion is called “anthropomorphism”, the attribution of human form to a natural force or thing – as, for instance, in the gods of Ancient Greece and Rome. On reflection, however, attributing economic and historical events to a conspiracy doesn't seem so simple or so reasonable. The conspiracy theory needs to explain how the conspiratorial group bring about these events and how they can keep their existence secret. To control the whole world – plot economic crises, wars and revolutions, let alone spreading AIDS and causing global warming – would require hundreds of thousands of operatives and some of these must be expected to spill the beans at some point. The fact that none ever have – and that therefore there is no verifiable or even unverifiable evidence that the conspiracy exists – is a powerful refutation of it.

David Aaronovitch argues that belief in conspiracy theories is harmful since it “distorts our view of history and therefore of the present” and can lead to disastrous decisions. He detects a pattern in which conspiracy theories are “formulated by the politically defeated and taken up by the socially defeated”. Conspiracies become an excuse to explain away a movement’s own inherent weaknesses or unpopularity by attributing blame to a ruthless enemy.

To be a truly effective liar, it is essential that you come to believe your own bullshit. Capitalism's continued existence does not require a conspiracy or a conspiracy theory. All it requires is the support, or more likely acquiescence, of the overwhelming majority in their own exploitation. Conspiracy theorists can’t offer an adequate explanation of what’s going on it the world. If we are going to change the world successfully we are going to need to understand it properly. And the only way we can do this is on the basis of verified evidence and logical thinking. This is what socialists try to do. Using this method, we can see no evidence of world events being organised by a conspiracy. In fact, we can see that the world is not organised at all. We can see everywhere the "anarchy" of capitalism. It is an impersonal mechanism not a conspiracy. And it is the cause of wars, revolutions and other conflicts in that these are by-products of capitalist competition, not the machinations of some secret conspiratorial group.

"Don't believe everything you read" but really, how was one to tell? Even supposing we read every word properly, how would we know whether it was right or not? Who are we to criticise? We need to be a scientist to criticise. Carl Sagan described it well: "Science is generated by and devoted to free enquiry: the idea that any hypothesis, no matter how strange, deserves to be considered on its merits. The suppression of uncomfortable ideas may be common in religion and politics, but it is not the path to knowledge." The "scientific" nature of the case for socialism is rooted in the real world of hard facts and reliable evidence, and so must people be if the world is to see any real progress.

The Ten Common Sense Rules
1. First of all, don't believe a complicated explanation if a simpler one will do.
2. Never believe anyone who will profit by lying.
3. Exceptions don't prove rules, despite the saying, they break them.( "prove" in this expression is related to the Italian "provare" which means "test" or "try out", which explains how this sensible maxim has acquired a modern, nonsensical meaning)
4. Even if the structure is logical, the basic assumptions may not be.
5. Beware of the sleight-of-hand known as special pleading, which is essentially a sales tactic
6. Don't be bamboozled or "blinded by science"
7. An idea is not a valid theory unless a way exists of disproving it (falsification).
8. A test result is not valid until and unless it can be recreated.
9. A theory which cannot predict anything is worthless.
10. The most obvious rule is that if the facts don't fit the theory, change the theory.

For a theory to be valid it should accord well with the facts, and offer one a way to disprove it. Thus religion and creationism are not valid scientific theories, whereas evolution and gravity are. If you think you can disprove all, or part, or a bit of the WSM case, go right ahead. We'll listen. If you find a flaw we'll have to change our ideas, and if, by the same token, we find a flaw in your thinking, you'll have to change yours. That is how the scientific method works. The world is as full of superstition and silly ideas as it was in the Middle Ages, but it is also now far richer in real knowledge. Whether the scientific method prevails in the future is open to question, for it has failed in the past to rescue societies from decline, and the ideology of capitalism is reinforced constantly by a battery of propaganda and mystification that are a perpetual obstacle to clear thinking. Socialists have every sympathy with scientists who find themselves under attack from unscientific prejudice and blatant opportunism, since this is not very dissimilar from our own experience.

cut the working week

2012-01-25T04:19:00.004Z

The workers' Mayday originated in the fight for the 40 hour week 5 day week and was finally achieved (more often honoured in the breach as in reality) in the US in 1938. Fifty years ago the American Federation of Labor called for a 30-hour work week (the U.S. Senate even passed a 30-hour law, though it was defeated in the House); in 1961 the head of the New York Central Labor Council urged unions to campaign for a 4-hour day. For decades the radical union the Industrial Workers of the World have had the demand for the 20 hour week - "4 hours work for 8 hours pay puts more workers on the job every day" but today the mainstream unions won't campaign even for a 35-hour week.

Now the New Economics Foundation have re-newed the call for a drastic cut in working hours. In a recent paper they argue for a 21-hour work week. The NEF says there is nothing natural or inevitable about what’s considered a "normal" 40-hour work week today. In its wake, many people are caught in a vicious cycle of work and consumption. They live to work, work to earn, and earn to consume things. Missing from that equation is an important fact that researchers have discovered about most material consumption in wealthy societies: so much of the pleasure and satisfaction we gain from buying is temporary, ephemeral, and mostly just relative to those around us (who strive to consume still more, in a self-perpetuating spiral). The NEF argues we need to achieve truly happy lives, we need to challenge social norms and reset the industrial clock ticking in our heads. It sees the 21-hour week as integral to this for two reasons: it will redistribute paid work, offering the hope of a more equal society (right now too many are overworked, or underemployed). At the same time, it would give us all time for the things we value but rarely have time to do well such as care for our family, travel, read or continue learning (as opposed to feeding consumerism).

To save the world by laying the foundations for a "steady-state" economy -- and to just make our personal lives better -- we will need to work less.

http://finance.yahoo.com/news/the-case-for-a-21-hour-work-week.html

What Did You Learn in School Today by Tom Paxton

2012-01-22T12:24:00.000Z

[Chorus]
What did you learn in school today

Dear little boy of mine

I learned that Washington never told a lie

I learned that soldiers seldom die
I learned that everybody is free

That's what the teacher said to me
And that's what I learned in school today

Today that's what I learned in school
[Chorus]
I learned that policemen are my friends

I learned that justice never ends

I learned that murderers die for their crimes
Even if we make a mistake sometimes
And that's what I learned in school today

Today that's what I learned in school
[Chorus]
I learned that war is not so bad
I learned of the great ones we had had

We fought in Germany and in France

And someday I might get my chance

And that's what I learned in school today

Today that's what I learned in school
[Chorus]
I leant our government must be strong

Its always right and never wrong

Our leaders are the finest men
We elect them again and again

And that's what I learned in school today

Today that's what I learned in school

Was it for democracy?

2012-01-22T09:51:00.001Z

Remember the Falklands/Malvinas war - the fight for democracy.

Before 1982, the biggest landowner, the Falkland Islands Company, owned by Coalite, ran seven farms accounting for 43 per cent of the total acreage.

Assembly member Mike Summers said: "It was feudal and colonialistic..."

Robert Rowlands remembers the days of the sheep-ocracy, when a small elite met in the colony club and "the rest of us owned nothing..."

http://www.independent.co.uk/news/world/americas/falklanders-we-are-the-luckiest-workingclass-people-on-earth-6292836.html

Great Men

2012-01-21T12:58:00.001Z

Is it a coincidence that so many of capitalism's Great Men - its leaders and captains of industry - are so utterly unworthy as human beings? It is surely unsurprising that capitalism's leaders should be such a disreputable crowd of scoundrels. After all, they are elected to run a system which thrives by robbing workers of the fruits of their labour and pursues competition by ruthless dishonesty, culminating in wars in which men, women and children are indiscriminately slaughtered upon the altar of profit. The system requires a certain brand of callousness at its nerve centre. To be elected, leaders need to tell complete lies with a straight face. Either that, or they must be clowns and puppets (Reagan or Bush) or masters of self-deception (Clinton or Obama).

The way they diminish and degrade their supporters is truly loathsome. Yet one of the saddest things about leaders is not how they behave but how their followers are forced to behave. The political follower is a miserable, pathetic specimen. These are people who will go the ends of the earth to defend the Great Man's reputation. The Obama-mania you so rightly say elsewhere preponderates in American politics.

Different views are held about the historical role of Great Men, ranging from the belief that history is made by Great Men, to the other extreme, that great men have no existence at all, that they are pure figureheads, and that they are largely fictitious personalities. One view says that great men make history, the other view says that they only personify movements and events, which develop quite independently of them.

Napoleon is quoted as having said “Mahommed’s case was like mine. I found all the elements to hand to found an empire. Europe was weary of anarchy, they wanted to make an end of it. If I had not come, probably somebody else would have done like me. I repeat, man is only a man, his power is nothing if circumstances and public sentiment do not favour him”

Engels said “That Napoleon, just that particular Corsican, should have been the military dictator whom the French Republic, exhausted by its own war, had rendered necessary, was an accident: but that if Napoleon had been lacking, another would have filled the place.”

The same could have been said of Cromwell and Abraham Lincoln. There is also the example of Lenin.

"Great Men" have had at times an influence in the working out and shaping of historical events. Many thinkers have acquired a greater insight into the workings of social and political events than their fellows and have passed this information on to help bring about a greater understanding of society and its development. This occurred with men such as Aristotle, Copernicus, Darwin, Marx and Einstein. All of them, however, could only work within the conditions and the limits of their particular time. In history, we are lead to believe that “Great Men” and ideas decide the course of events, where in reality, events, combined with their underlying conditions, establish the limitations and opportunities which determine in broad outline who shall be “Great Men” and which ideas will triumph.

Noam Chomsky, one of the world’s most important intellectual figures has been described as “common sense raised to genius”

Artists and musicians sometimes make extraordinary imaginative leaps, but genius did not just drop from the sky. Michelangelo may have had sudden inspiration about how to fulfil the commission in the Sistine Chapel, but as a youth he had served a three-year apprenticeship in the workshop of Domenico Ghirlandaio before turning to the study of the great masters of the past, including Greek and Roman sculptors. He had precursors and masters whose thoughts he pursued or revived.

Japan and Iran

2012-01-20T03:45:00.001Z

Ask most Americans why the United States got into World War II, and they will talk about Pearl Harbor. Ask him why the Japanese attacked Pearl Harbor and many Americans will struggle for an answer, perhaps suggesting that the Japanese people were aggressive militarists who wanted to take over the world. Ask if the United States provoked the Japanese, and they will probably say that the Americans did nothing: we were just minding our own business when those crazy Japanese, completely without justification, mounted a sneak attack , catching us totally by surprise at Pearl Harbour on December 7, 1941. Don’t bother to ask the typical American what U.S. economic warfare had to do with provoking the Japanese to mount their attack, because he won’t know.

Japan as an expanding industrial nation required access to raw materials and energy. In the Great Depression, as trade dried up and unemployment grew, an ultra-nationalist clique within the Japanese military sought to secure the markets and raw materials Japan so desperately wanted. For a time there were two competing strategies to capture oil, the Strike North route to acquire the USSR's and the Strike South route to capture the Dutch East Indies, one being mainly land-based and army dominated , the other mostlly naval. 1938 saw the defeat of an attempted Japanese invasion of the USSR , (which brought General Zhukov to prominence). Therefore Japanese diplomacy became centred upon the views of the naval commanders.

Japan relied heavily upon American oil and metals

In 1939 the United States terminated the 1911 commercial treaty with Japan. July 2, 1940, Roosevelt signed the Export Control Act, authorizing the President to license or prohibit the export of essential defense materials.” Under this authority, “ exports of aviation motor fuels and lubricants were restricted.The US the imposed a total ban on exports of iron and steel scrap, and finally, in July 1941, by a freezing of Japanese assets and a tightening of the licensing requirements that de facto ended all trade with Japan, including oil exports.
Foreign Minister Teijiro Toyoda had communicated to Ambassador Kichisaburo Nomura on July 31: “Commercial and economic relations between Japan and third countries, led by England and the United States, are gradually becoming so horribly strained that we cannot endure it much longer. Consequently, our Empire, to save its very life, must take measures to secure the raw materials of the South Seas."

"Within days of the freeze announcement, PM Konoe set about arranging a meeting with Pres. Rooseveldt in a last ditch attempt to restore trade relations and avoid war in the Pacific. While FDR initially welcomed Konoe's planned visit, his inner circle, as they had for decades, vied Japan as untrustworthy and vulnerable, and steadfastly opposed the idea of a Pacific summit...Hull, Hornbeck, Stimson and others also shared the view of senior military officials that a successful summit could have disastrous consequences for America's strategic position in Asia. A negotiated end to the war in China and the prompt withdrawal of Japanese forces would sine qua non of any agreement and this, military officials argued, America must avoid. In October 1941, Hayes Kroner, chief of the British Empire Section for the War Department General Staff, informed Army Chief of Staff George C. Marshall, as follows ' At this stage in the execution of our national strategic plan, cessation of hostilities in China...would be highly detrimental to our interests' ...By early November, Tojo and Togo overcame substantial cabinet opposition to continued negotiations and won approval for talks based on two proposal. In Prposal A. Tokyo pledged to immediately withdraw forces from Indochina, remove troops from all of China except Hainan Islans and the far north and respect the Open Door. Japan also agreed to notautomatically support Berlin in the event of a German-American war. Proposal B sought only a limited agreement in which Japan pledged to refrain from furtheroffensive operations in return for normalized trade relations and a US promise 'not to take such actions as may hinder efforts for peace by both Japan and China. http://books.google.co.th/books?id=1mZMjLghgzsC&pg=PA50&lpg=PA50&dq=japan+sanctions+second+world+war&source=bl&ots=NKsBNCUamO&sig=MU-T_l0M_Q95K5551A4DfNY5ikI&hl=en&sa=X&ei=i9cYT6XzOsOsrAejscXfDQ&redir_esc=y#v=onepage&q&f=false

Henry L. Stimson, who had been secretary of war confided to his diary after a meeting of the war cabinet on November 25, “The question was how we should maneuver them [the Japanese] into firing the first shot without allowing too much danger to ourselves.” After the attack, Stimson confessed that “my first feeling was of relief ... that a crisis had come in a way which would unite all our people.

There are in the above lessons to be learned in regard to Iranian sanctions. A cornered country will bite back and America will sacrifice peace for dominance.

Posts on Paul

2012-01-19T15:43:00.002Z

Ron Paul - The antebellum tentherist

"Ron Paul's little known bill, the We the People Act...clearly, is an attempt to block national redress of state tyranny. It makes it possible for individual states to create their own little theocracies, while it prevents anyone from taking this to an authority beyond those individual states. Obvious abuses come to mind and strike this reader as a return to pre-Civil War days, when "states rights" was an excuse to continue the practice of slavery. I find it an incredibly dangerous piece of legislation, and indicative of the mindset of Ron Paul. Indicative of the con game he's been playing as well. Champion of civil rights and civil liberties? Not if "states rights" trump them. "
http://www.dailykos.com/story/2011/12/30/1050145/-Ron-Paul:-States-Rights-before-Civil-Rights

Bruce Wolman blogs "...While Paul's anti-war stances and liberalism can attract adherents, if he were to become President those positions wouldn't necessarily have the consequences many supporters might think. Let's say Paul becomes President and does reduce US militarism, foreign interventionism, eliminate Federal drug laws, etc. His States Rights position would allow states to pick up the slack in all of these areas. From my reading of Paul, the Federal Government would stop supporting Israel, but he would have not hinder New York and California cutting their own deals with the Israelis if the states so chose...While US military aid would end, US defense corporations could sell their wares abroad without government control or intervention. While the Federal Government would restrict its own violations of civil liberties, the states would be able to run their own affairs and corporations would be without regulation or interference of their fundamental right to use their property and capital as they saw fit, including spending on political involvement. One of the reasons Christian extremists are attracted to Paul despite his libertarian positions is that they believe his states rights priority would allow them to regulate private behavior on the state level..."
http://mondoweiss.net/2011/12/more-responses-to-ron-pauls-surge.html

One comment of the above explains that under the constitution "No State shall enter into any Treaty, Alliance, or Confederation...enter into any Agreement or Compact with another State, or with a foreign Power, or engage in War, unless actually invaded" Trade such as arms though is something different.

As individul economies California has a similar GDP as France. Texas’ economy compares to that of Canada. Florida is comparable to South Korea. Illinois – Mexico New Jersey – Russia Ohio – Australia New York – Brazil Pennsylvania – Netherlands Georgia – Switzerland North Carolina – Sweden.

The bottom 10 states are Delaware – Romania Utah – Peru New Hampshire – Bangladesh Maine – Morocco Rhode Island – Vietnam South Dakota – Croatia Montana – Tunisia North Dakota – Ecuador – Belarus Vermont – Dominican Republic Wyoming – Uzbekistan

Historically, state governments were some of the biggest supporters of the vilest discrimination in the United States. Federal laws were necessary because racist state politicians and local police were murdering, harassing and oppressing people in a regular and systematic fashion based solely on their race.

Q: But you would decriminalize it [drug laws]?
Ron Paul: I would, at the federal level. I don’t have control over the states.

"So all of you who believe that Ron Paul would release the millions incarcerated for the victimless crime of using drugs should realize that he would only release those held in federal prisons. If you're locked up in the State Penitentiary, he sympathizes, but thinks that States have a perfect right to do it. The total federal prison population in 2010 was around 200,000 people while the state and local prison population was about 1.5 million. Paul says there's nothing he can do about the latter and wouldn't dream of telling those states what they should and shouldn't do. That's his principle, not freeing the victims of the drug war."

"Just because you break up state power into fifty entities instead of one, it doesn't make their infringements on liberty ok, does it? On a philosophical and ideological level, libertarians should be clear that infringements of people's rights should never be subject to the whims of the state --- whether it's Hawaii or the United States of America. So why doesn't Ron Paul say this? He defends states' rights to infringe on individual liberty as being under the Constitution but what he's really defending are the Articles of Confederation. This isn't libertarianism. It's "tentherism" disguised as libertarianism.

http://digbysblog.blogspot.com/2011/12/imposing-political-correctness.html

i have previously claimed Ron Paul is a propertarian and not a libertarian but this us the first time i have come across an alternative description of him - a tentherist, a constitutional theory that early twentieth century justices wielded to protect monopolies and strip workers of their right to organize

http://www.alternet.org/teaparty/148593/tentherism:_the_bizarre_ideology_behind_tea_partiers%27_plans_to_kill_social_security_and_child_labor_laws

He can also be described as a throw-back.

"Libertarians who believe that "statism" is ok if comes from state of California but not the US government are not only living in the early 19th century, they are basically saying that their only real beef is if the government abridging individual freedom is the federal government. Tyranny on a smaller scale isn't their concern. And that isn't liberal or libertarian. It's just plain old antebellum era American politics -- which is what Ron Paul truly believes when you see his positions on issue after issue. The antebellum south is where his philosophy really comes from --- and where it leads"
http://digbysblog.blogspot.com/2011/12/antebellum-libertarianism.html

Historically, state governments were some of the biggest supporters of the vilest discrimination in the United States.
"Paul's Christian Reconstructionist friends, seek the destruction of the federal government for the opportunity to implement "God's law" on earth. Ron Paul seeks to shrink the federal government to minimal size not because it intrudes in the lives of individuals, but because it stands in the way of allowing the states and localities to enact laws as they see fit -- even laws that govern people's behavior in their bedrooms."
http://digbysblog.blogspot.com/2011/12/devolution-for-some-of-people.html

"WALLACE: You talk a lot about the Constitution. You say Social Security, Medicare, Medicaid are all unconstitutional.
PAUL: Technically, they are.…
WALLACE: Congressman, it’s not just a liberal view. It was the decision of the Supreme Court in 1937 when they said that Social Security was constitutional under Article I, Section 8 of the Constitution.
PAUL: And the Constitution and the courts said slavery was legal to, and we had to reverse that.
That's interesting because Paul's philosophy really says that the constitution doesn't have the authority to declare slavery illegal..."
http://digbysblog.blogspot.com/2012/01/third-partys-charm-ron-pauls-nod-to.html

Many do not endorse all of Ron Paul's views and policies, yet by not saying anything critical of those and preferring to simply ignore them, becoming complicit in a cover-up.

Obama/Paul - Repeating mistakes

The fact that our class enemies fall out amongst themselves over what they consider the better policy in their overall interest does not mean we support them. Genuine libertarian communists are vehemently anti-capitalist, but we do not support the Establishment, or Leninists and Trotskyists, nor the fascist so-called anti-capitalists. We do not employ the same arguments as other Republicans or the pro-Obama parties, nor the MSM against Ron Paul.

A vote for Ron Paul is vote for capitalism and the illusion that capitalism can change its spots. Capitalism is in the end an ideology; everything it does, all of its workings, all of it is a human product, constructed in the minds of humans, and obeyed because it presents itself as the natural law, as the real world, and the realm of the possible. Money itself is the example par excellence of ideology at work; it is a sign, an idea, used to cover up the contradictions in property society. Money presents itself as the natural and only way of dealing with property relations, and as a socially neutral object, and not as a way of controlling poverty and inequality in favour of a small minority, which it really is. To fail to reveal the ideology, to de-mystify and explain it, means to remain within it.

Many “anti-capitalist” personalities have indeed in the past urged people to support one of the two main capitalist parties, the Democrats, on the grounds that they are a “lesser evil” compared with the Republicans. Now they insist the lesser evil is to vote for is Ron Paul. The socialist response is straightforward. If you want to get somewhere, aim for that destination directly, rather than going on detours and trusting that you will eventually, by however roundabout a route, arrive at where you want to be.

I do not deny that in some ways or in some situations it may be better to have Ron Paul rather than Obama in the White House. After all, isn’t it worthwhile just to reduce, even if not eliminate, the probability of an attack on Iran? In that case, helping them into office does ward off a greater evil. But only in the short term. For once in office, Paul would come under irresistible pressure from his capitalist masters to break his “populist” promises, to disappoint, disillusion and betray the people who placed their trust and hope in him. Some capitalist politicians are totally subservient to the oil, gas, and coal corporations and recklessly oblivious to the looming danger. In their hands we are doomed. Other capitalist politicians are a little less subservient, show a limited awareness of the situation, and try to do something to mitigate it. Something, but much less than is absolutely essential. In their hands we are still doomed. Hoping that Ron Pauo will behave differently is a utopian – expectation. Any politician who tries to run capitalism gets his hands grubby, as a matter of course, in what is a very dirty business.

The main difference between them is Paul admits to being a swine, Obama lies about it!!

It is good that so many of Obama’s followers are disillusioned. It seems, though, that many of those who describe themselves as disillusioned are accusing Obama of breaking his promises, rather than blaming themselves for falling prey to a naïve illusion. The idea that Obama has broken his promises can only seem valid to those who – against all the evidence he himself provided – fashioned an image of him as the country’s progressive saviour

Obama made no secret during his election campaign of his “moderate” political outlook. A central theme of his campaign, in fact, was the need for bi-partisanism to counter the trend towards politics becoming too “ideological”. Those who now criticize Obama for being yet another spineless Democrat were not paying adequate attention to the statements he made during the campaign. Obama made no secret of his deeply-held principle of never sticking to any principle. He has never claimed to be anything but a “pragmatist”, which is a nicer way of saying “opportunist”. Obama has not budged from his belief that the solutions to the problems plaguing the United States can be found lying in the middle of the political road, so to speak, just waiting to be picked up. This is the belief he wrote about back in 2006, and his policies in office have been based on it.

There was, of course, that promise Obama made about bringing about some sort of change. Things have changed – just not for the better. He left many Bush Administration policies intact; and even his healthcare reform that leaves the parasitic insurance companies in place and even presents them with opportunities for expansion.

“I believe in the free market, competition, and entrepreneurship, and think no small number of government programs don’t work as advertised…I think America has more often been a force for good than for ill in the world; I carry few illusions about our enemies, and revere the courage and competence of our military…"

Yet how can Obama be blamed for all those false expectations? The signs that Obama was more of a wolf in sheep’s clothing were there.

His views on foreign policy, for example, an area where the views of the “anti-war” candidate Obama were thought to differ sharply from the hawkish approach of Hillary Clinton (now his Secretary of State!), not to mention the belligerent policies of Bush and McCain. Obama made it perfectly clear in The Audacity of Hope that he would deploy US troops when necessary, because “like it or not, if we want to make American more secure, we are going to have to help make the world more secure”. Rather than rejecting Bush’s absurd and counter-productive “war on terrorism”, Obama wrote that “the challenge will involve putting boots on the ground in ungoverned hostile regions where terrorists thrive”. And lest the reader imagine that such military force would only be used in retaliation, Obama claims that “we have the right to take unilateral military action to eliminate an imminent threat to our security”. It is something of a mystery how Obama managed to convince so many that he was a foreign policy “dove” while at the same time publishing such views.

Few of his thoughts are in harmony with the views of his leftwing supporters, who worked so hard to get him elected. People went from the naïve view that Bush is the root of all evil to the equally simplistic idea that Obama could uproot that evil. And now we have a sense of disillusionment due to the persistence of deep-rooted problems despite the election of Obama. Yet the idea that Obama has betrayed us is based on the initial illusion that he could rescue us from problems that are deeply rooted in capitalism itself. This notion, in turn, is no different from the superficial idea that those problems arose from Bush’s stupidity or mendacity. It is pointless to transform Obama from a saviour into a new scapegoat.

The Socialist Standard wrote at the time of his election:
"If Obama apologists think President Obama will put a halt to the blood letting they are going to be sorely disappointed. Make no mistake; whilst the left are fond of castigating Republicans as the masters of war, the truth is that historically the Democrats have started far more wars than the GOP. More recently, under the last Democrat to hold office, President Clinton, one million Iraqis are said to have died under US enforced sanctions, 500, 000 of them children. Sorties over Iraq were flown every single day Clinton was in power. Yugoslavia was mercilessly bombed and a much needed pharmaceutical plant in Sudan was bombed on the pretext that it was manufacturing Chemical weapons, and villages in Afghanistan were flattened because Bin-Laden was presumed to be living there. And who could forget the US invasion of Somalia, with troops storming the beaches live on prime time TV!...Not only is Obama incapable of ushering in significant change, bar a few miserly reforms, but neither is there anyone he can bring to his administration capable of bringing the change that was so promised in his election campaign for no other reason that changers do not get confirmed by the Senate. There exist quite influential interest groups – the AIPAC, the military security complex, Wall Street etc to hinder the advancement of such undesirables The hope many have in Obama to implement policies that will benefit the class that matters is misplaced. His political rawness means he will be manipulated by more experienced advisers, little different from the neo-cons, maybe even key figures from the Bush administration, and pressured by a corporate elite who funded his victory to execute policies that fit in with their own agenda.

The outcome of US elections carries one truth: namely that whichever candidate becomes president, he has but one remit once in office – to further the interests of the US corporate elite.It’s just not a feasible option for any newly elected president to entertain any idea other than guaranteeing a safe playing field for the domestic profit machine and doing what’s needed to try to ensure the US maintains its global hegemonic status "

Now it is Paul who is providing illusion that one single politician can transform a rotten social system.

Big Pharma - Big Profits

2012-01-17T03:31:00.001Z

Tamiflu maker accused of secrecy over trial data. Scientists are set to raise serious questions about the effectiveness of Tamiflu, its side-effects and the opaque way drugs get approved for widespread use on the NHS.

Cochrane, a non-profit group dedicated to analyzing medical evidence, brings together the combined results of the world's best medical research studies, and are recognised as the gold standard in evidence-based health care. But during their two-year study into Tamiflu, researchers claimed they were hampered in their efforts to fully appraise the drug by the refusal of its manufacturer, Roche, to hand over all the raw data used to support their claims.

Professor Sir Iain Chalmers, a founder of the Cochrane Collaboration, told The Bureau of Investigative Journalism: "We have invested millions of pounds on stockpiling Tamiflu on the basis of a paper that presented the results of 12 trials, only two of which have been published. The investigation... shows Roche refused to provide data to evaluate these trials. Investigators got some data through the European Medicines Agency, but this doesn't answer all of the questions they have." He added: "It is a disgrace that Roche have not provided this data."

Tom Jefferson, the lead author of the study, said he was very concerned about the unwillingness of Roche to provide all the raw data. It is understood the European Medicines Agency that approved Tamiflu also only saw a proportion of the drugs trial results. The US Food and Drug Administration is thought not to have reviewed the largest ever trial of Tamiflu when considering it for approval.

http://www.independent.co.uk/life-style/health-and-families/health-news/tamiflu-maker-accused-of-secrecy-over-trial-data-6290699.html

SELLING CANCER

2012-01-14T06:56:00.001Z

Diego Ballesteros Pino, the director of oncology at the Baja California Health Authority explains that "When a person gets a cancer diagnosis they are so hungry for life. It is human nature to not hear what the oncologists are saying and this gets even stronger when the oncologist has to tell the patient there are no longer treatments that are available for him, that they can no longer guarantee survival and that's when they start looking for hope." And that, he said, is where the alternative therapy clinics step in. "...they are definitely predatory. They're only out to make money. I see many people that come after being cheated out of their money with more advanced stages of cancer. They missed the opportunity to have the conventional medicine. Our first duty is to try to convince them to stop doing the alternative medicine and that is one of the hardest things. And some of them do get better, some of them we are able to save. Some we cannot."

Frank Cousineau, president of the Cancer Control Society believes in the efficacy of alternative cancer therapies. He says people do not need statistics, they need love. "They don't come seeking peer reviewed studies, they come for hope, because hope has been destroyed in the conventional oncology community. Too many oncologists, with a very almost cold hearted demeanor, will tell a patient that nothing can be done for them."

Professor Ian Smith at the UK's Royal Marsden Hospital. He says that while he has never seen a patient cured by alternative therapies, he accepts that the medical profession still has a lot to learn about supporting terminally ill patients who have reached the end of the road as far as conventional medicine is concerned. "It's an important criticism of us I think. We are getting it right now, much more of the sense that we have to support people all the way through and hopefully that's a way we can combat this pressure on patients to go and sell their house and sell everything and have some valueless treatment."

Some of the Tijuana clinics are offering nothing but false hope. There is little or no evidence to support their claims that their strange therapies actually work and there is plenty of evidence that vulnerable people have parted with large sums of money for no reason. ($21,000 for a two week course, a hotel down the road at your own expense and there would be the extras for treatment on return to London.). At the Hospital Santa Monica that was used to be run by an American called Kurt Donsbach a FBI investigation revealed that over an 18 month period he made $32.5m from selling treatments. Donsbach was jailed for a year after pleading guilty in a San Diego court to 13 felony charges including: impersonating a doctor, spiking his internet 'natural' supplements with dangerous and banned pharmaceuticals and falsely telling an undercover FBI agent he had a 60 per cent success rate for treating terminal cancer patients.

Gina Darvas, the San Diego deputy district attorney, collected over 400,000 pages of evidence against him. She says: "Throughout the prosecution he remained fairly defiant and again tried to promote himself as a victim of overzealous prosecution, that the medical establishment was out to silence him for alternative medical opinions .... He said, I have a 60 per cent success rate in getting you another five years of life, and it's only going to cost you $23,000 cash up front and that’s a very powerful and persuasive incentive to someone who has maybe six months to live. It’s preying on the most vulnerable victim that could possibly be found in my view. To run a con on somebody in that situation is a terrible thing to do."

http://www.aljazeera.com/programmes/peopleandpower/2012/01/2012111152415164558.html

free the net

2012-01-14T04:48:00.000Z

A British student can be extradited to the United States for running a website linking to sites carrying pirated TV shows and films, a court has ruled. Richard O'Dwyer, a 23-year-old student at Sheffield Hallam University, looked downward as district judge Quentin Purdy ruled that there were no valid reasons why he could not be sent to New York state for trial. US customs agents are seeking his prosecution over a website O'Dwyer set up when he was 19 called TVShack, and ran until his arrest last year. This provided links to other sites hosting pirated versions of TV shows and film. O'Dwyer's lawyers said the site was little different from a search engine like Google and was thus most likely not illegal under UK law.

His mother, Julia, wept "If they can come for Richard they can come for anyone."

The US Immigration and Customs Enforcement agency's assistant deputy director told the Guardian that they would now actively pursue websites similar to TVShack even if their only connection to the US was a website address ending in .com or .net. Such suffixes are routed through Verisign, an internet infrastructure company based in Virginia, which the agency believes is sufficient to seek a US prosecution.

http://www.guardian.co.uk/law/2012/jan/13/tvshack-student-founder-extradition

The Human Zoo

2012-01-08T03:02:00.002Z

The Jarawa tribe is 403-strong. Its members are trusting, innocent and hugely vulnerable to exploitation, living in a jungle reserve on South Andaman, islands in the Bay of Bengal belonging to India. Anthropologists think the Jarawa are descendants of some of the first humans to move out of Africa. Theirs is a simple life. Men hunt pigs and turtles with bows and arrows; women gather fruit and honey. They have no gods and when people die they are left under a tree until only the skeleton remains. Then the tribe tie the bones to their bodies to bring luck during the hunt. It was only in 1998 that they started to venture out of the jungle in any numbers. Like many previously uncontacted tribes, the Jarawa are vulnerable to unfamiliar diseases. They started succumbing to measles and mumps and even malaria, to which they previously appeared to have some sort of immunity. Some have also adopted the vices of the outsiders: tobacco, alcohol and betel nuts.

"Dance," the policeman instructed. The girls in front of him, naked from the waist up, obeyed. A tourist's camera panned round to another young woman, also naked and awkwardly holding a bag of grain in front of her. "Dance for me," the policeman commanded. The role of the police is to protect tribespeople from unwelcome and intrusive outsiders. But on this occasion the officer had accepted a £200 bribe to get the girls to perform. "I gave you food," he reminded them. Tourists threw bananas and biscuits to the tribespeople at the roadside, as they would to animals in a safari park.

In 2007 the government established a buffer zone around the reserve, hoping to protect the tribe from further interaction with the outside world, in particular a luxury resort being constructed on the very edge of the reserve by the Barefoot India tour company. The company hired lawyers to fight the zone and the case is currently with India's supreme court. In an attempt to reduce contact, the authorities have cut the number of tourist convoys to eight a day.

Those responsible for the tribe's welfare think the only solution is to keep them apart from outsiders for as long as possible. "Forced coexistence would be total genocide for them," says Dr Anstice Justin, head of the Anthropological Survey of India in Port Blair.

"The Jarawa could easily be decimated or reduced to a state of dependency, as has happened to so many other tribes worldwide," says spokeswoman for Survival International Sophie Grig. Survival argues that closing the road would at least allow the tribe to decide whether it has contact.

everyone wants to avoid is the Jarawa going the way of the Great Andamanese, who once lived around Port Blair. From 10,000 in the late 18th century, their numbers have now fallen to about 50 and the tribe is drifting out of history. "They lost the will to live," says Denis Giles, editor of the islands' Andaman Chronicle newspaper. "The government gave them all facilities, it gave them jobs, but they started drinking and begging. They lost their self-respect and their language and their culture. It is easy for politicians to say integrate, but it is not simple to put it into practice."

Giles added it was principally the young Jarawa who had come out of the jungle, fascinated by outsiders and what they have to offer. As they grow older, they lose interest, realising that the outside world is not for them.

http://www.guardian.co.uk/world/2012/jan/07/andaman-islands-tribe-tourism-threat

Ron Paul - the Propertarian

2012-01-06T09:08:00.002Z

How easy it is to fall into the same trap as we often criticise the MSM for ie accepting their re-definition of words.

Check out the history of the political meaning of "Libertarian"

http://anarchism.pageabode.com/afaq/150-years-of-libertarian

Ron Paul is NOT a libertarian, no matter how often he or others make the claim. To be clear and to use the correct terminology Ron Paul is a propertarian

Right-"libertarians" are not interested in eliminating capitalist private property nor the authority, oppression and exploitation which goes with it. They make an idol of private property and claim to defend "absolute" and "unrestricted" property rights. In particular, taxation and theft are among the greatest evils possible as they involve coercion against "justly held" property. They call for an end to the state, not because they are concerned about the restrictions of liberty experienced by workers and tenants but because they wish capitalists and landlords not to be bothered by legal restrictions on what they can and cannot do on their property.

Chomsky argues that right-wing "libertarianism" has "no objection to tyranny as long as it is private tyranny." , "if you have unbridled capitalism, you will have all kinds of authority: you will have extreme authority."
Again Noam Chomsky put it: "Anarcho-capitalism, in my opinion, is a doctrinal system which, if ever implemented, would lead to forms of tyranny and oppression that have few counterparts in human history. There isn't the slightest possibility that its (in my view, horrendous) ideas would be implemented, because they would quickly destroy any society that made this colossal error. The idea of 'free contract' between the potentate and his starving subject is a sick joke, perhaps worth some moments in an academic seminar exploring the consequences of (in my view, absurd) ideas, but nowhere else."
Chomsky explains "Consider, for example, the [right-'libertarian'] 'entitlement theory of justice' . . . according to this theory, a person has a right to whatever he has acquired by means that are just. If, by luck or labour or ingenuity, a person acquires such and such, then he is entitled to keep it and dispose of it as he wills, and a just society will not infringe on this right. One can easily determine where such a principle might lead. It is entirely possible that by legitimate means -- say, luck supplemented by contractual arrangements 'freely undertaken' under pressure of need -- one person might gain control of the necessities of life. Others are then free to sell themselves to this person as slaves, if he is willing to accept them. Otherwise, they are free to perish. Without extra question-begging conditions, the society is just.The argument has all the merits of a proof that 2 + 2 = 5 "

Paul's support for "free market" capitalism ignores the impact of wealth and power on the nature and outcome of individual decisions within the market. This can be seen in the argument of Paul's influence Ayn Rand - "Freedom, in a political context, means freedom from government coercion. It does not mean freedom from the landlord, or freedom from the employer, or freedom from the laws of nature which do not provide men with automatic prosperity. It means freedom from the coercive power of the state -- and nothing else!".

Right-"libertarians" ignore the vast number of authoritarian social relationships that exist in capitalist society. The right-"libertarian," then, far from being a defender of freedom, is in fact a defender of certain forms of authority. To defend the "freedom" of property owners is to defend authority and privilege.

Right-"libertarianism" is unconcerned about any form of equality except "equality of rights". This blinds them to the realities of life; in particular, the impact of economic and social power on individuals within society and the social relationships of domination they create. Individuals may be "equal" before the law and in rights, but they may not be free due to the influence of social inequality, the relationships it creates and how it affects the law and the ability of the oppressed to use it. Without social equality, individual freedom is so restricted that it becomes a mockery (essentially limiting freedom of the majority to choosing which master will govern them rather than being free).

In Ron Paul's "libertarian" world there would be no National Insurance, no Social Security, no National Health Service nothing corresponding to the Poor Laws; there would be no public safety-nets at all. It would be a rigorously competitive society: work, beg or die.

Emma Goldman's rightly attacked that "rugged individualism" expoused by Paul "which is only a masked attempt to repress and defeat the individual and his individuality. So-called Individualism is the social and economic laissez-faire: the exploitation of the masses by classes by means of trickery, spiritual debasement and systematic indoctrination of the servile spirit . . . That corrupt and perverse 'individualism' is the strait-jacket of individuality . . . This 'rugged individualism' has inevitably resulted in the greatest modern slavery, the crassest class distinctions . . . 'Rugged individualism' has meant all the 'individualism' for the masters, while the people are regimented into a slave caste to serve a handful of self-seeking 'supermen' . . .and in whose name political tyranny and social oppression are defended and held up as virtues while every aspiration and attempt of man to gain freedom and social opportunity to live is denounced as . . . evil in the name of that same individualism."

Common ground? The socialist opposition to wage labour was shared by the pro-slavery advocates in the Confederacy. The latter opposed wage labour as being worse than its chattel form because, it was argued, the owner had an incentive to look after his property during both good and bad times while the wage worker was left to starve during the latter. This argument does not place them in the socialist camp any more than socialist opposition to wage labour made them supporters of slavery. As such, right-"libertarian" opposition to the state should not be confused with anarchist and real-libertarian opposition. The former opposes it because it restricts capitalist power, profits and property while the latter opposes it because it is a bulwark of all three. Therefore it is no coincidence that Ron Paul try to limit the definition of "libertarian" purely to opposition to the state or government.

As Anatole France said which reflects Ron Paul's philosophy "The law, in its majestic equality, forbids the rich as well as the poor to sleep under bridges, to beg in the streets, and to steal bread."

Many thanks to Anarchist FAQ
http://infoshop.org/page/AnAnarchistFAQ

St Paul

2011-12-26T07:13:00.003Z

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.

Merry Marxmas

2011-12-25T03:41:00.002Z

Re-defining the rat race

2011-12-19T03:53:00.002Z

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

Trust in God?

2011-12-12T05:05:00.001Z

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?

reforms change little

2011-12-07T05:26:00.000Z

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.

political integrity

2011-12-06T06:51:00.000Z

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 .

food facts

2011-12-05T08:13:00.002Z

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

working hours

2011-12-03T05:37:00.001Z

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

magic

2011-12-01T05:15:00.001Z

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.

BEYOND THE CUTBACKS.

2011-11-30T01:08:00.000Z

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.

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

2011-11-27T05:33:00.001Z

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.

divide and rule

2011-11-25T06:26:00.001Z

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”.

Banking yet again

2011-11-12T23:38:00.003Z

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

2011-11-12T22:55:00.000Z

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.

Talking Capitalism is not talking !

2011-11-11T01:24:00.000Z

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

Selling the Revolution

2011-11-08T15:04:00.004Z

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."

The recession's recovery

2011-11-03T05:51:00.002Z

"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.

One Life

2011-10-31T05:53:00.000Z

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

2011-10-31T05:49:00.001Z

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

.

Meet the 1%

2011-10-23T01:43:00.000+01:00

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)

But we arer the same the world over

2011-10-21T05:03:00.000+01:00

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.

THE SAME THE WORLD OVER

2011-10-18T06:45:00.001+01:00

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.

Stealing your pension

2011-10-12T04:36:00.002+01:00

A former Boots finance chief has accused the firm of risking the future returns of its 20,000 pensioners by trying to change the way their plans are paid. Alliance Boots has written to members of its retirement scheme offering a "pension increase exchange". Under the proposal pensioners can choose to give up future inflation-linked increases on pensions earned before 1997 in exchange for a one-off boost to pensions.

But the independent pension consultant John Ralfe, the former head of corporate finance at Boots, said yesterday: "The exchange is not neutral for pensioners – the company is giving only 60 per cent of the value of expected increases and keeping 40 per cent for itself. Even those pensioners who live to the average age will be worse off and those living longer than average will be much worse off." He said the firm's pensioners were being asked to make an extremely difficult decision and claimed Alliance Boots "leaves itself open to misselling claims from pensioners and elderly widows who find themselves living too long".

from here

Smoking is radio-active

2011-10-12T04:08:00.004+01:00

Cigarettes contained a radioactive substance called polonium-210. Tobacco companies have known this for over 40 years. The companies studied the polonium throughout the 1960s, knew that it caused "cancerous growths" in the lungs of smokers, and even calculated how much radiation a regular smoker would ingest over 20 years. Then, they kept that data secret. Researchers have replicated the original calculations that tobacco company scientists described in documents and found that the levels of radiation in cigarettes would account for up to 138 deaths for every 1,000 smokers over a period of 25 years.

Polonium-210 is a radioactive material that emits hazardous particles called alpha particles. Polonium's radioactive particles don't simply vanish when cigarette smoke blows away.

Dr. John Spangler, a professor of family medicine at the Wake Forest Baptist Medical Center in North Carolina, said when smokers inhale, the radioactive particles damage the tissue on the surface of the lungs, creating "hot spots" of damage. When combined with other cancer-causing chemicals in tobacco, Spangler said the damage from radiation is potent.

"The two together greatly increase your risk of lung cancer," Spangler said. "So tobacco smoke is even more dangerous than you thought before." Spangler said smokers may not realize how long this radiation can linger in their homes. "Some of these radiation particles hang around for decades and decades," Spangler said. "You're emitting radiation when you smoke, and your family, your dog, your cat are all inhaling that radiation. How many smokers want to expose their child to radiation?"

In 1980, scientists discovered that a process called "acid washing" removes up to 99 percent of polonium-210 from tobacco. The documents reviewed by UCLA scientists reveal that tobacco companies knew of this technique, but declined to use it to remove the radioactive material from their products. Officially, tobacco companies said acid washing would cost too much and might have a negative impact on tobacco farmers and on the environment. But the documents revealed another reason why the industry avoided acid washing for tobacco leaves: the process would alter the nicotine in the plants and make it less able to deliver the "instant nicotine rush" smokers craved.

The death industry remains immune from the law

From here

The Scapegoats

2011-10-10T05:51:00.001+01:00

In several eastern European countries there is a war against the Roma. There are marches against them. Self-proclaimed vigilantes bully and threaten them. Walls are built around the sections of town where they live. Their houses are set on fire. They are forced out of their homes and sometimes brutally murdered. Almost everywhere, the authorities have stood aside.

The Roma are easy scapegoats. They're at the bottom of society, have no lobby and are poorly-organized politically. There is societal racism against them, and it is legitimized by a majority of the ruling elite. In 1993, after three Roma in the Romanian village of Hadareni were lynched with the involvement of the police, the government, in its official explanation, expressed understanding for the "anger of the villagers." And in February 2009, when right-wing extremists in the Hungarian village of Tatárszentgyörgy set the house of a Roma family on fire and shot the father and his young son as they fled from the flames, no member of the Hungarian government called on people to unite to stop the violence.

The lack of prospects for the Roma in eastern Europe has prompted tens of thousands of them, primarily from Romania and Bulgaria, to head west. Roma refugees have come to Italy, Spain, France, England, and recently also to Germany's large cities. In the western European countries they work for a couple of euros an hour doing cleaning, construction, or they beg. Some steal. For many, it is more than they could have ever imagined in their home countries.

From here

the land grab

2011-10-07T00:06:00.000+01:00

Farmland investments may return an average of 8 percent to 12 percent annually as global food demand increases, said the largest U.S. pension manager for teachers and academic researchers with $469 billion of assets. The pension manager buys land and leases it back to farmers, The company has $2.5 billion invested in farmland and owns about 600,000 hectares (1.48 million acres) mostly in the U.S., Brazil and Australia. Returns in the past few years have been at the high end of the 8 percent to 12 percent range.

Farmland values in one of the most-productive regions in the U.S. Midwest soared 17 percent in the second quarter as higher grain prices made real estate more attractive

Shrinking land and water supply in countries including China and India, will limit their capacity to boost food production, creating import demand. That’s going to be met by the major exporting regions in North and South America, Australia, and parts of Central and Eastern Europe.

http://www.businessweek.com/news/2011-10-06/farmland-seen-returning-up-to-12-by-u-s-pensions-manager.html

Economic Democracy or dictatorship in another guise

2011-10-05T11:22:00.002+01:00

Once again on my net travels i came across this idea.

David Schweikart, After Capitalism, a review of his book here

An outline of the economic model by him here

Very briefly
"worker self-managed market socialism...has three basic features: 1) each productive enterprise is managed democratically by its workers; 2) the day-to-day economy is a market economy: raw materials and consumer goods are bought and sold at prices determined by the forces of supply and demand; 3) new investment is socially controlled: the investment fund is generated by taxation and dispensed according to a democratic, market-conforming plan."
More details at the link

Applying a Marxian approach and see that all the fundamental categories that define capitalism - generalised wage labor, commodity production (means of production were bought and sold between enterprises as well as final goods), money , profits, capital accumulation, class monopoly of the mean of production etc etc - were also to be found in the Economic Democracy. A democratised version of capitalism is what is required. Well actually that would still make it a class-based exploitative capitalist society in which the prusit of profit was paramount - only a nicer, more cuddly, version of capitalism That is that makes it capitalist and not socialist Once more we see an attempt at squaring the circle, making capitalism work in the interest of the community by "improving" on Yugoslavian-type workers councils and Mondragon-type co-operatives and introducing banking reform to finance it all. Within this model wage labour would still function and it follows that so too would capital. Capital accumulation out of surplus value would be the overriding imperative of his system. He wants to humanise capitalism and the wage labour-capital relation. A utopia. Capitalism needs inequality to function properly on its own terms. Egalitarian capitalism is a contradiction in terms.
He may think he is talking about a socialised economy, but the reality is that he is mimicking a capitalist economy involving workers self-exploitation and their competition against eachother.

And when they fail , pray tell us the difference between this "If a firm is unable to generate even the minimum per-capita income, then it must declare bankruptcy. Movable capital will be sold off to pay creditors. Any excess is returned to the investment fund, while fixed capital reverts to the community both processes mediated by the affiliated bank. Workers must seek employment elsewhere." and what happens these days. It doesn't matter essentially who pockets the profit enterprises make in your system which enterprises, it would be "held accountable" and would compete in the market in pursuit of profit.

Work-places won't be owned by the workers nor will it be controlled by the public, the power resting in the banks. The "public" will no more "own" than the workers "control" since they are still slaves to the market.

At the end of the day what we have is just another class-based society parading as one in which the means of production are purportedly publically-owned but actually owned by the state-apparatus and from which with a wave of a magic wand has expelled all those disagreeable little things about capitalism like class struggle, exploitation and so on. Schweikart's fallacy is that he believes the words "economic democracy" have a magical power; that saying it's so, makes it so. But there has to be a content, a material basis, for worker-managed socialism, that is to say there must be the reproduction of a social relation that does away with the organisation of labour as a class activity specific to workers.

Labour power IS a commodity by virtue of being exchanged for a wage. It remains a system of alienated labour which Marxists identify with capitalism. In fact it isn't socialism if the working-class exists at all.

There are many cases where workers take over, or start up, businesses themselves. This was described Marx in Capital Vol 111 where he referred to the role of worker co-operatives.

"The co-operative factories of the labourers themselves represent within the old form the first sprouts of the new, although they naturally reproduce, and must reproduce, everywhere in their actual organisation all the shortcomings of the prevailing system. But the antithesis between capital and labour is overcome within them, if at first only by way of making the associated labourers into their own capitalist, i.e., by enabling them to use the means of production for the employment of their own labour."

There is a tendency for worker co-ops to resemble more and more over time the conventional capitalist business model and the case of Mondragon - the largest worker co-op conglomerate in the world - would seem to bear this out. Over time, as it has grown, it has departed more and more from its original egalitarian principles and Mondragon has been noted for employing heavy hand tactics against its own workforce.

What about those who cannot work? The very young , the very old, the sick and the disabled? Are they not going to get anything? If they are going to get something where is this going to come from except out of the revenue generated by the wealth producers in the form of a taxation levy?.

The point is that we should not make a fetish out of worker ownership of industry. While it operates within the framework of a system of commodity production it will suffer from the very real shortcomings that capitalism inevitably imposes. It is only through the struggles of workers coupled with the spread of socialist consciousness and the idea of a socialist alternative to capitalism that this embodies that we can ever hope to transcend capitalism through the self abolition of our class and hence the elimination of class society itself.

More could be said about Schweikart's market socialism and its flawed conclusions but perhaps for another day

Marx or Keynes

2011-10-04T12:34:00.003+01:00

Keynesianism can mean a lot of things to lots of people, but the central idea is pretty easy to characterise – markets are good, but they need taming by government. Keynes' theory was massively interpreted, reinterpreted, and misinterpreted, over the years. Some within the more left-wing "post-Keynesian" tradition. Keynesian economics, as opposed to free market capitalism, maintains that the state can and should intervene in the economy in order to stop economic crises from occurring. After 1945. Keynesianism became the ideology of overall political management of the economy (e.g. "fine tuning").

Every capitalist crisis, no matter what its imputed causes, manifests itself in a declining accumulation of capital. The share of social production earmarked for expansion is considerably reduced or even fully eliminated, curtailing total social production in the process. Seen from the restricted view of the market, however, this process appears as overproduction of goods or insufficient demand. The depression that resulted was a deflationary process which affected both prices and production, but which at the same time brought about substantial changes in the economic structure and prepared the way for a new economic boom. The depression became an instrument for overcoming economic crisis, and although not deliberately encouraged, it was passively allowed to run its course. Inflation, the creation of money by the state, impairs the price mechanism. As capital grew it created obstacles to its own further expansion. Its periodic crises became more and more oppressive and persisted long enough to create a real danger that the deflationary process would lead to social upheaval rather than to a new boom. To prevent this from happening, state economic interventions were in order in the great crisis that followed the 1929 crash; their theoretical justification came later.
This interventionist policy sought to achieve by inflationary means what seemed no longer attainable by deflationary methods. Keynes assumed that the interest rate was dependent on the quantity of money in circulation. An increase in the money supply would decrease the interest rate and spur new investments, which in turn would increase employment and raise prices and profits. Since the state had the power to create more money, it was a matter of government decision whether the way to economic recovery would be through lower interest rates. However, the profitability of capital had already fallen so far that even a reduction in interest rates would not be sufficient stimulus new investments. It would therefore be necessary to make up for the defective private demand by creating more public demand. However, since an increase in public spending by way of taxation would cut even more into the profits of the private sector, it would have to be financed through state deficits. The technique, of course, was not to print more money, which would depreciate the currency, but merely to expand state credit which would absorb idle private capital and finance the increased public demand. This added demand would, it was expected, stimulate the economy as a whole sufficiently to bring it out of the depression and into a boom, which in turn would enlarge the state's tax revenue to such a degree that it would be able to pay off its depression incurred debts in a new period of prosperity. The co-ordinated employment of monetary and fiscal policies would not only counteract the deflationary trend of the crisis, they would in addition initiate a new period of upswing, which although containing inflationary tendencies, need not degenerate into a real inflation as long as unused money and real capital were still available. The specter of inflation would loom only if anew disproportionality arose between the means of payment and commodity production. But this was a real possibility only when full employment was reached, and then it could be combated by state-initiated deflationary policies. In short, it was imagined that a theory and practical policy had finally been found which would place the economic cycle under conscious state control.
Even under the best conditions, a steadily rising inflation rate leads eventually to economic stagnation. Inflation must then be halted at the point where it begins to have a negative effect on the economy. Just as governments add steam to inflation by their monetary and fiscal policies, contrary measures can slow its course. However, it is not within the power of governments to bring inflation totally to heel, since price inflation will continue despite deflationary government measures. This being the case, depression is aggravated in two directions: on the one hand, because of a stepped up general economic decline, and on the other, because of the multiplying social conflicts generated by the inflationary distribution of income. Depression, like an upswing, sets limits to inflation. But any limit can be overstepped if one is willing to accept or is unable to avoid the attendant social risks; the hyper-inflations of the past are ample testimony to this. But the risk is far greater when inflation is worldwide than when it is isolated within individual countries, as has been the case in the past. The bourgeoisie therefore tries to check it, but it can only do so by accepting lower profits, reducing public spending, and allowing depression to deepen. As the hopes that the depression will have a deflationary effect fade, they are replaced by prospects of a new boom contrived by inflationary means. Where all this will lead cannot be forecast with certainty, but at least one thing is sure: the present crisis, with its peculiar deflationary inflation, will keep the world in a perpetual state of unrest that could easily lead to catastrophe.

The mainstream economics that emerged post-war, sometimes called the "neo-classical synthesis", was a more conventional marriage of core elements of the old "neoclassical theory" with Keynesian insights. For as far as economics goes, Keynes' co-worker, Joan Robinson coined the phrase "Bastard Keynesianism" to describe the vulgarisation of his economics and its stripping of all aspects which were incompatible with the assumptions of neo-classical economics. Thus the key notion of uncertainty was eliminated and his analysis of the labour market reduced to the position he explicitly rejected, namely that unemployment was caused by price rigidities. This process was aided by the fact that Keynes retained significant parts of the neo-classical position in his analysis and argued that the role of the state was limited to creating the overall conditions necessary to allow the neo-classical system to come "into its own again" and allow capitalism "to realise the full potentialities of production." [Keynes, The General Theory] Keynesianism was a tool for saving capitalism and avoid socialism. Save capitalism by reforming it. Keynesian economics is not trying to democratise the economy. Keynesian economics is more about regulation, public sector spending and so on, its not about democratic control, or worker control. It works within the framework of how to keep growth going, it leaves class systems in place and supports them. Keynesianism is not socialist, not even close, its just responsible capitalism. It isn't calling for abolishment of social classes but rather things like more progressive taxation, universal healthcare, spending on infrastructure projects etc.

In terms of policy rather than theory, the "Keynesian consensus" typically involved a number of common elements. First, markets are volatile and sticky so they need hands-on regulation. Second, when private investment fails the government can step in via fiscal (i.e., tax and spending) policy, and if necessary with big spending programmes like the European welfare states. Third, at the international level, capital flows are stabilised with a global financial architecture: the Bretton Woods system which fixed currency exchange rates until 1971; and institutions like the World Bank and IMF.

Keynes's demand management (or pump priming money) aims to overcome crisis by increasing the rate of exploitation. If it was implement correctly, it would lead to the lowering of the working class's living standard. Keynes wrote:

“Thus it is fortunate that the workers, though unconsciously, are instinctively more reasonable economists than the classical school, inasmuch as they resist reductions of money-wages, which are seldom or never of an all-round character, even though the existing real equivalent of these wages exceeds the marginal disutility of the existing employment; whereas they do not resist reductions of real wages, which are associated with increases in aggregate employment and leave relative money-wages unchanged, unless the reduction proceeds so far as to threaten a reduction of the real wage below the marginal disutility of the existing volume of employment. Every trade union will put up some resistance to a cut in money-wages, however small. But since no trade union would dream of striking on every occasion of a rise in the cost of living, they do not raise the obstacle to any increase in aggregate employment which is attributed to them by the classical school.” [ The General Theory]

Unlike neo-classical economist who prefer to cut nominal wage (or using deflation). Keynes preferred to cut the worker's living standard by cutting real wage using inflation so there would be fewer obstacles posed by unions to capitalist's profit restoration project. Inflation is therefore a means of attacking real wages. It can also be a concession to the working class since it tends to keep inefficient businesses functioning (every wage-slave with a grain of class consciousness knows that these are the best ones to work for!) Inflation tends to undermine debts (by reducing the value of repayments) and so favours industry relative to finance capital

Thus left-wing Keynesians who later founded the Post-Keynesian school of economics recognised that capitalists "could recoup themselves for rising costs by raising prices." Joan Robinson

The "Bastard Keynesianism" of the post-war period (for all its limitations) did seem to have some impact on capitalism. There is what is often called the "Golden Age of Capitalism," the boom years of (approximately) 1945 to 1975. This post-war boom presents compelling evidence that Keynesianism can effect the business cycle for the better by reducing its tendency to develop into a full depression. By intervening in the economy, the state would reduce uncertainty for capitalists by maintaining overall demand which will, in turn, ensure conditions where they will invest their money rather than holding onto it (what Keynes termed "liquidity-preference" and a situation we now call “credit-crunch”). In other words, to create conditions where capitalists will desire to invest and ensure the willingness on the part of capitalists to act as capitalists. This period of social Keynesianism after the war was marked by reduced inequality, increased rights for working class people, less unemployment, a welfare state you could actually use and so on. Compared to present-day capitalism, it had much going for it.

So instead of attempting the usual class war (which may have had revolutionary results), sections of the capitalist class thought a new approach was required. This involved using the state to manipulate demand in order to increase the funds available for capital. By means of demand bolstered by state borrowing and investment, aggregate demand could be increased and the slump ended. In effect, the state acts to encourage capitalists to act like capitalists by creating an environment when they think it is wise to invest again. As Paul Mattick points out, the "additional production made possible by deficit financing does appear as additional demand, but as demand unaccompanied by a corresponding increase in total profits. . . [this] functions immediately as an increase in demand that stimulates the economy as a whole and can become the point for a new prosperity" if objective conditions allow it. [ Crisis and Crisis Theory]

Keynesian capitalism is still capitalism and so is still based upon oppression and exploitation. It was, in fact, a more refined form of capitalism, within which the state intervention was used to protect capitalism from itself while trying to ensure that working class struggle against it was directed, via productivity deals, into keeping the system going. For the population at large, the general idea was that the welfare state (especially in Europe) was a way for society to get a grip on capitalism by putting some humanity into it. In a confused way, the welfare state was promoted as an attempt to create a society in which the economy existed for people, not people for the economy. So there is no denying that for a considerable time, capitalism has been able to prevent the rise of depressions which so plagued the pre-war world and that this was accomplished by government interventions. This is because Keynesianism can serve to initiate a new prosperity and postpone crisis by state intervention to bolster demand and encourage profit investment. This can mitigate the conditions of crisis, since one of its short-term effects is that it offers private capital a wider range of action and an improved basis for its own efforts to escape the shortage of profits for accumulation. In addition, Keynesianism can fund Research and Development in new technologies and working methods (such as automation) which can increase profits, guarantee markets for goods as well as transferring wealth from the working class to capital via indirect taxation and inflation. In the long run, however, Keynesian "management of the economy by means of monetary and credit policies and by means of state-induced production must eventually find its end in the contradictions of the accumulation process." [Mattick] This is because it cannot stop the tendency to (relative) over-investment, disproportionalities and profits squeeze In fact, due to its maintenance of full employment it increases the possibility of a crisis arising due to increased workers' power at the point of production. So, state intervention can, in the short term, postpone crises by stimulating production, however, these interventions do not actually set aside the underlying causes of economic and social crisis.

We frequently hear the distinction that Keynesian economics is of the Left, and the Austrian/Chicago school of the Right. Workers should not get involved in, or be distracted by, inter-capitalist squabbles but should keep their eye on the ball - to defend their own interests in the most militant fashion possible whether against the state or some private corporation. Beyond that they should be looking to get rid of capitalism in all its guises including state-capitalism, or mixed-economy. is any merit at all in workers supporting nationalisation as against privatisation. I say no because for workers to do so is a to be coopted into supporting one form of capitalism vis-a-vis another. Workers should follow a policy of strict abstentionism or neutrality on the question of economic policy which in the end is a capitalist issue not a working class issue. They should militantly pursue their class interests whether in the private sector or the state sector and not seek to ally themselves with sections of the capitalist class in wanting to expand the latter or minimise the former.

Through Keynesianism the state has become stronger and more centralised. Chomsky could state that "prisons also offer a Keynesian stimulus to the economy, both to the construction business and white collar employment; the fastest growing profession is reported to be security personnel." [ Year 501]

The pattern of a particular crisis is influenced by the concrete circumstances of the time so no crisis is merely a repetition of those which have preceded it. While there are elements common to all crises we cannot say in advance how these elements will interact in a specific situation or what is the relative strength of other factors associated with it. Consequently to understand a crisis, we can only be wise after the event.

We can say that all crises are intimately connected with two fundamental features of the system, viz., " anarchy of production " and " disproportional industrial development." These two features are again intimately bound up with each other. By anarchy of production we do not infer economic chaos, on the contrary capitalism is a system ruled by laws and compulsions of its own. What is meant is that capitalism is not a system consciously regulated by social aims. Capitalists do not meet beforehand to harmonise production in accordance with social ends. Capitalism being profit motivated production, capitalists invest in industry for no other motive and without regard for and little knowledge of other investments being carried out at the same time. Because the different branches of industry are atomistically controlled or to state it alternatively because "anarchy of production," prevails in capitalism, decisions for capital investment are carried out by Capitalists without knowledge or regard for investment decisions being made at the same time by other capitalists elsewhere. But capitalist production is social production and the different branches of industry form an interlocking whole. It can be seen then that the different yet integrated industrial spheres, governed as they are by autonomous decisions being made simultaneously, there exists in the system an inherent bias towards uneven development between the various branches of industry. When this disproportionality reaches a certain level the possibility of a crisis emerges. Thus the phase of the business cycle associated with accelerating investment, rising wages, rising employment and increasing profits, will come to an end and be replaced by the antithetical phase of reduced investment, falling employment and declining wages and profits. Capitalism may be described as a system of unstable equilibrium.

To put the matter concretely, capitalists in a particular industry have overestimated the demands for their product and so produced more than the market can absorb at a remunerative price and if we take it that other industries have not similarly expanded, then it can be said that this particular industry has over-expanded relative to other industries, i.e. a disproportionality of industrial development has taken place. This relative over-expansion of industry will, however, generate cumulative effects. Not only will the industry affected cut investment and hence production but in doin'g so it reduces its demands for commodities, including labour-power, to those industries linked to it. They in turn will cut their orders to other concerns and so on. As a result a widespread decline in production will occur. If the initial over-expansion is big enough it may permeate the entire economy and precipitate a crisis. Large scale unemployment will appear, purchasing power suffer a sharp decline and surplus products will then begin to appear on the market as a matter of course. It can be seen then that over-production in one branch of industry brings elements of over-production in other branches of industry, and by rupturing the conditions of equilibrium, initiates relative over-production, which is indistinguishable from general over-production. All crises then are crises of relative over-production. An industry can only over-expand in relation to other industries although the effect which this produces is, as has been already stated, indistinquishable from general overproduction.

Crises, as Marx pointed out, do not arise through a lack of paying consumption of the mass of the population. They arise because disproportional development in one industrial sector leads to a curtailment of investment (and so production) which by upsetting the balance of the different industrial branches brings about a general slowing down of production. The lack of paying consumption is a consequence not a cause of crises. A crisis is made possible because of the antagonistic class distribution of income inherent in a system of antagonistic class relations of production. Capitalists cut back investment because there is an unsatisfactory income distribution for them, in that profit margins are too small and wage levels too high. They are not concerned with some abstract purchasing power but in the concrete fact that the purchasing power in the form of wages is too high for the existing volume of capital to earn a given return. There is still plenty of purchasing power in the pockets, holdings, banks, etc of the capitalists, but of course they do not choose to spend.

People should ask themselvs if they think state intervention -- Keynesianism -- disproves the Marxist contention of capitalism as intrinsically prone to crisis and crises are not just incidental interludes between periods of high trade activity but an essential corrective for the uninhibited self-expansion of capital. As Marx states it: "Periodically the conflict of antagonistic agencies seek vent in crises. The crises are always but momentary and forcible solutions of the existing contradictions, violent eruptions which restore the disturbed equilibrium for a while." [Capital]

Thanks to here

Everything free with the SPGB

2011-09-29T07:19:00.002+01:00

The Socialist Party of Great Britain is part of the World Socialist Movement ( more an aspiration rather than the reality, sadly) and founded in 1904, emerging from the 19th social democracy political parties.

When someone comes across the Socialist Party for the first time, a common reaction is to consider us as just another left-wing political organisation. The Left use similar terminology to us, talking of socialism, class struggle, exploitation, etc, and invoking Karl Marx. But digging a little deeper will show that our political position is very different from that of the left-wing. The Socialist Party is not on the Left. The left-wing like to act as though they are Moses, and lay down the commandments in stone for followers to obey. Left-wing propaganda offering leadership adds to the impression that the worker is an inferior being who is incapable of thinking, organising and acting and imbues further the master-and-servant mentality of the worker. As already stated all Left organisations start from the premise that workers are too stupid to understand or want socialism by their own volition. Therefore, revolutionary ideas have to be introduced from outside the working class by all-knowing "professional revolutionaries" who will lead workers to the promised land. We are not and never have been connected with the ideas of Lenin, Trotsky or Stalin. We have always been opponents of state-ownership and were one of the earliest proponents of the theory that the USSR was state-capitalist and not on any road towards socialism/communism (regarding the distinction between both words are to be found in Lenin and not Marx ).

The SPGB engage in the parliamentary process not to form a government but for the purpose of seizing control of the state for its abolishment. We insist on the necessity of majority understanding behind socialist delegates with a mandate for socialism, merely using the state and parliament for one revolutionary act, after which the Socialist Party has no further existence. The State is the centralised organised power of the capitalist class. In the interests of that class it performs a dual function – administers the property affairs of the various sections comprising the class, and takes whatever steps are considered necessary to keep the working class in order. It is the latter co-ercive function of the State that has concerned us here. It controls every department of the armed forces, all the way from the policemen’s clubs up to the colossal force of the atomic bomb. So long as the capitalist class is allowed to remain in control of the military, there would be no chance of dispossessing the capitalists, or abolishing their system. The primary move on the part of a revolutionary working class entails gaining control of the armed forces. The House of Commons, Reichstag, Congress or Dail, these so-called popular assemblies control the armed forces. Every bill presented, and every law passed, regarding every phase of military expenditure, reduction, or increase, has to go through the parliamentary channels. There is no possibility of the workers successfully engaging the capitalist class on the basis of brute force or violence. The tremendous and destructive nature of military weapons in society today preclude the possibility of successful competition. The owning class has a supreme and invincible weapon within its grasp: political power, – control of the army, navy, air and police forces.

We will need to organise politically, into a political party, a socialist party, a mass party that has yet to emerge, not a small educational and propagandist group such as the SPGB is at present. This future party will neutralise the state and its repressive forces but there is no question of forming a government and "taking office", It will proceed to take over the means of production for which the working class have also already organised themselves to do at their places of work. This done, the repressive state is disbanded and its remaining administrative and service features, reorganised on a democratic basis, are merged with the organisations which the majority will have formed (workers councils or city/town communes or whatever) to take over and run production, to form the democratic administrative structure of the stateless society of common ownership that socialism will be. By gaining control of the powers of state, the socialist majority are in a position to transfer the means of living from the parasites, who own them, to society, where they belong. This is the only function or need the working class has of the state/government. As soon as the revolution has accomplished this task, the state is replaced by the socialist administration of affairs. There is no government in a socialist society. “Capturing” Parliament is only a measure of acceptance of socialism and a coup de grace to capitalist rule. The real revolution in social relations will be made in our lives and by ourselves, not Parliament. What really matters is a conscious socialist majority outside parliament, ready and organised, to take over and run industry and society. Electing a socialist majority in parliament is essentially just a reflection of this. It is not parliament that establishes socialism, but the socialist working-class majority outside parliament and they do this, not by their votes, but by their active participating beyond this in the transformation of society.

One of the driving forces for the creation of the party was the view that democracy was integral to the establishment of socialism and thus a party with that object needs to be a reflection of the democratic principle. So although with a long history as a political party based on agreed goals, methods and organisational principles we still remain a small propagandist group. Mandating delegates, voting on resolutions and membership referendums are democratic practices for ensuring that the members of an organisation control that organisation – and as such key procedures in any organisation genuinely seeking socialism. Socialism can only be a fully democratic society in which everybody will have an equal say in the ways things are run. This means that it can only come about democratically, both in the sense of being the expressed will of the working class and in the sense of the working class being organised democratically – without leaders, but with mandated delegates – to achieve it. In rejecting these procedures what is being declared is that the working class should not organise itself democratically.

As a matter of political principle the Socialist Party holds no secret meetings, all its meetings including those of its executive committee being open to the public. This means that all its internal records (except, understandably, for the current membership names and addresses which remains confidential) are open to public consultation. In keeping with the tenet that working class emancipation necessarily excludes the role of political leadership, the SPGB is a leader-less political party where its executive committee is solely for housekeeping admin duties and cannot determine policy or even submit resolutions to conference (and all the EC minutes are available for public scrutiny with access on the web as proof of our commitment to openness and democracy). All conference decisions have to be ratified by a referendum of the whole membership. The General Secretary has no position of power or authority over any other member being a dogsbody. The SPGB has no hierarchy and all members are constitutionally equal. Despite some very charismatic writers and speakers in the past, no personality has held undue influence over the the SPGB. Under UK electoral law, a registered political party has to name its leader and to comply the SPGB simply drew a name out of a hat and it is doubtful if any member recollects who it was

We actually have a test before someone can become a member.The SPGB will not allow a person to join it until the applicant has convinced the branch applied to that she or he is a conscious socialist. Surely it must put some people off? Well, that may be, but it can't be helped. There would be no point in a socialist organisation giving full democratic rights to those who, in any significant way, disagreed with the socialist case. The outcome of that would be entirely predictable. This does not mean that the SPGB has set itself up as an intellectual elite into which only those well versed in Marxist scholarship may enter. The SPGB has good reason to ensure that only conscious socialists enter its ranks, for, once admitted, all members are equal and it would clearly not be in the interest of the Party to offer equality of power to those who are not able to demonstrate equality of basic socialist understanding. Once a member, s/he have the same rights as the oldest member to sit on any committee, vote, speak, and have access to all information. Thanks to the test all members are conscious socialists and there is genuine internal democracy, and of that we are fiercely proud. Consider what happens when people join other groups which don't have this test.The new applicant has to be approved as being "all right". The individual is therefore judged by the group according to a range of what might be called "credential indicators". Hard work (often, paper selling) and obedience by new members is the main criterion of trustworthiness in the organisation. In these hierarchical, "top-down" groups the leaders strive at all costs to remain as the leadership , and reward only those with proven commitment to the "party line" with preferential treatment, more responsibility and more say. New members who present the wrong indicators remain peripheral to the party structure, and finding themselves unable to influence decision-making at any level, eventually give up and leave, often embittered by the hard work they put in and the hollowness of the party's claims of equality and democracy.

We share in common with the Industrial Workers of the World the view that unions should not be used as a vehicle for political parties. The SPGB have always insisted that there will be a separation and that no political party should , or can successfully use , unions as an economic wing, until a time very much closer to the revolution when there are substantial and sufficient numbers of socialist conscious workers. And thats not in the foreseeable future. It is NOT the SPGB's task to lead the workers in struggle or to instruct its members on what to do in trade unions, tenants' associations or whatever, because we believe that workers are quite capable of making decisions for themselves and creating their own flexible means of resisting the encroachments of capitalism,depending on situations and circumstances. For the Leninist, , of course, as you pointed out in one article, all activity should be mediated by the Party (union activity, neighbourhood community struggles or whatever.)

While work-place democracy is unquesioningly a pre-requisite for socialist administration, it seems as you never took the issue to its logical end.The real democratic safeguard is when no-one can deprive another of the means for life - food clothing and shelter - through sectional ownership of them, regardless of how internally democratic their enterprise might be. This was the SPGB argument against syndicalism and industrial unionism and co-operatives. Since socialism is based on the social ownership (= ownership by society as a whole, common ownership) of the means of production, the trade union ownership proposed by the syndicalists (the mines for the miners, railways for the railmen) was not socialism at all but a modified form of sectional ownership. A society run by syndicates/ industrial unions would be a society which would perpetuate the occupational divisions which capitalism imposed on workers. Such a form of organisation would divide the workers on the basis of the industries in which they were engaged, with the inevitable consequence that the industrial interest must triumph over the social interest which socialism so fundamentally demands. In addition, the relations between the separate union-run industries, it has been argued, would have to be regulated either by some central administration, which would amount to a government and so give rise to a new ruling class or by some form of commercial exchange transaction (even if conducted in labour-time vouchers rather than money as many syndicalists proposed.) In other words, a syndicalist society would be a sort of capitalism run by the unions. Socialism aims not to establish "workers power" but the abolition of all classes including the working class. It is thus misleading to speak of socialism as workers ownership and control of production. In socialist society there would simply be people, free and equal men and women forming a classless community. So it would be more accurate to define socialism/communism in terms of the common ownership and democratic control of the means of production by and in the interest of the whole people. "Workers council" would have been a misnomer since socialism, being a classless society, involves the disappearance of the working class just as much as of the capitalist class. "Democratic councils" would have been a more appropriate term. A society where the means of production belong to everybody and run by democratic councils, that's socialism.

The threat of the bureaucracy assuming a new class in socialism cannot arise. Free access to goods and services denies to any group or individuals the political leverage with which to dominate others, a feature intrinsic to all private-property or class based systems through control and rationing of the means of life. The notion of status and hierarchy based upon the conspicuous consumption of wealth would be devoid of meaning because individuals would stand in equal relation to the means of production and have free access to the resultant goods and services.This will work to ensure that a socialist society is run on the basis of democratic consensus. This will work to ensure that a socialist society is run on the basis of democratic consensus. Decisions will be made at different levels of organisation: global, regional and local with the bulk of decision-making being made at the local level. A socialist economy would be free access to the common treasury with no monopoly of ownership, and not even the actual producers who in the past have called for ownership of their own product, as promoted by mutualism and syndicalism, can deprive individuals in society to the common ownership of the means of production and distribution. A socialist society will be one in which all people will be free to participate fully in the process of making and implementing policy. Whether decisions about constructing a new playground, the need to improve fish stocks in the North Sea, or if we should use nanobots to improve our lives, everyone everywhere will be able to voice their opinion and cast their vote. However, the practical ramifications of this democratic principle could be enormous. If people feel obliged to opine and vote on every matter of policy they would have little time to do anything else. The traditional image of huge crowds with their hands up in council meetings, or queues of people lining up to put a piece of paper in a box, is obviously becoming old-fashioned, even in capitalism. On the other hand, leaving the decision-making process to a system of elected executive groups or councils could be seen as going against the principle of fully participatory democracy. If socialism is going to maintain the practice of inclusive decision making which does not put big decisions in the hands of small groups but without generating a crisis of choice, then a solution is required, and it seems that capitalism may have produced one in the form of 'collaborative filtering' (CF) software. This technology is currently used on the internet where a crisis of choice already exists. Faced with a superabundance of products and services, CF helps consumers choose what to buy and navigate the huge numbers of options. It starts off by collecting data on an individual's preferences, extrapolates patterns from this and then produces recommendations based on that person's likes and dislikes.With suitable modification, this technology could be of use to socialism - not to help people decide what to consume, but which matters of policy to get involved in. A person's tastes, interests, skills, and academic achievements, rather than their shopping traits, could be put through the CF process and matched to appropriate areas of policy in the resulting list of recommendations. A farmer, for example, may be recommended to vote upon matters which affect him/her, and members of the local community, directly, or of which s/he is likely to have some knowledge, such as increasing yields of a particular crop, the use of GM technology, or the responsible use of land by ramblers. The technology would also put them in touch with other people of similar interests so that issues can be thrashed out more fully, and may even inform them that "People who voted on this issue also voted on…" The question is, would a person be free to ignore the recommendations and vote on matters s/he has little knowledge of, or indeed not vote at all? Technology cannot resolve issues of responsibility, but any system, computer software or not, which helps reduce the potential burden of decision making to manageable levels would. How could too much voting be bad for you.

The SPGB describes socialism as free access. Actually, socialists don’t want to “abolish” money. What we want is to see established a system of society where money would become redundant, as it would in a society based on the common ownership and democratic control of the means for producing wealth. People would cooperate to produce what was needed to live and enjoy life and then have free access to this. Socialism will have no need to abolish money. The need for money will have vanished with the abolition of capitalism. Although money will disappear in socialism this does not mean that there will no longer be any need to make choices, evaluations and calculations. Our argument is that these evaluations and calculations, including those conceding the non-monetary "cost" of objects in terms of the effort and materials used to produce them, will be done directly in kind, without any general unit of account or measurement, neither money nor labour-time. Wealth will be produced and distributed in its natural form of useful things, of objects that can serve to satisfy some human need or other. Not being produced for sale on a market, items of wealth will not acquire an exchange-value in addition to their use value. In socialism their value, in the normal non-economic sense of the word, will not be their selling price nor the time needed to produce them but their usefulness. It is for this that they will be appreciated, evaluated, wanted… and produced. So estimates of what is likely to be needed over a given period will be expressed as physical quantities of definite types and sorts of objects. Decisions apart from purely personal ones of preference will be made after weighing the real advantages and disadvantages and real costs of alternatives in particular circumstances. The belief that without money nothing can work is flawed. The truth is that production is carried out by people not money. Problems are solved by human beings, not money.

The SPGB website is at http://www.worldsocialism.org/spgb/
The WSM website is at http://www.worldsocialism.org/index.php

We conspire

2011-09-26T10:29:00.002+01:00

Conspiracy theories are not a new phenomenon – far from it but perhaps not to the extent that to-days conspiracy theories have recently proliferated and taken hold even amongst sophisticated and well-educated sections of the population, and the way in which virtually no major event or phenomenon can currently unfold without someone crying “conspiracy!” and finding a ready audience. We have entered an era of paranoid politics. Interest in real political ideas has declined and hand-in-hand with this has gone a suspicion of all those engaged in the political process. This distrust, which has been fuelled by very real revelations of wrong-doing in high places, has tainted the popular perception of not just the individuals involved but of the entire political process has been gripped by distrust. And distrust breeds paranoia. Most conspiracy theories are really believed not by those who come into closest contact with the "conspirators" but by the disenfranchised and dispossessed. The extreme fringes of capitalism's political spectrum, on the far left and the far right, whether they be anti-globalisation crusties or the US militiamen in the hills of Montana. David Aaronovitch detects a pattern in which conspiracy theories are “formulated by the politically defeated and taken up by the socially defeated”. Conspiracies become an excuse to explain away a movement’s own inherent weaknesses or unpopularity by attributing blame to a ruthless enemy. Aaronovitch argues that belief in conspiracy theories is harmful since it “distorts our view of history and therefore of the present”

Postmodernism, a loose body of thought, contends that interpretation is everything and truth is transitory , and that science and reason are merely particular interpretations of events, being “narratives” with no more claim to validity than any other. It is postmodernism and the parallel distrust of science and progress that has arisen in recent years that has opened the way for conspiracy theories to multiply – whether they have a basis in reality or not. At the same time – and without coincidence – various New Age and occultist ideas and practices have gained ground. Postmodernism, irrationality and conspiracy theories now unite to form a bizarre trinity that informs much popular interpretation of historical events and processes. It is no surprise that those most attracted to New Age and occultist theories are typically those who also give most credence to conspiracism as a systematic way of interpreting events. These are people who do not merely contend that conspiracies of some sort have taken place or have been uncovered (whether it be the JFK assassination or Roswell ) but whose entire worldview is a conspiratorial one.

The Nazis, whose worldview was one drenched in anti-semitism to the extent that they thought the world dominated by a cabal of Jewish bankers, were steeped in a mysticism and occultism that had been handed down to them by fellow initiates of secret societies like the Thule Society. In fact many have gone one step further than the Nazis in thinking that all major conspiracies, together with all secret societies, are intrinsically linked, being but different aspects of the same age-old conspiracy. The current favourite is the “Illuminati” who were, amongst many other things, allegedly behind the founding of the United States (or its Fed Reserve), the UN, the EU and any other supposedly “centralising”, “controlling” bodies. in this theory, the Bilderberg Group, the Trilateral Commission, the Freemasons etc are all slowly working towards the achievement of some kind of centralised, totalitarian New World Order. Mysticism and conspiracist ideas interlock and reinforce one another.

Conspiracy theorists gain plausibility by taking established fact and embellishing it, so that one can’t tell where truth ends and fiction begins. There are undoubtedly shadowy societies of the super-rich which are well-documented. The Skull and Bones in America includes many senators, four past presidents, while in Britain we have the Masonic Lodge. But of course, they can’t be very secret or we wouldn’t know about them.

Conspiracy theorists take the view that the modern world society must be controlled from the top – someone, somewhere must be pulling the strings. The conspiracy theorists interpret every event (even contradictory ones) as being evidence that everything is under some secret groups control. The stock-in-trade of the conspiracy writers is rumour, innuendo, guilt-by-association and half-knowledge passed off as fact and a re-iteration of the inter-connectedness of some sections of the capitalists class (the Rothschilds, for example). Yes, there is plentiful evidence that organisations like the Bilderberg group exist. Yes, there is evidence that their members are rich and powerful people with their own agendas and quite some influence. There's no doubt that such groupings do exist. For instance, George Monbiot discusses the European Round Table of Industrialists (ERT), an association of the bosses of forty-six of the biggest companies in Europe. They have long advocated the creation of a single market in Western Europe, and called for the improvement of transport links - including the building of the Channel Tunnel. The ERT does not control governments, but it certainly influences them. But no, there is no evidence that such organisations “rule the world” and manipulate countries and economies at will – and no-one has yet provided any such evidence.

The conspiratorial worldview is certainly not promoting an understanding of modern society. Those unfamiliar with the analysis of Marxian economics are yet to realise that at the heart of the capitalist economy is a genuine “anarchy of production”. Conspiracy theorists' assertions that a complex, technologically advanced society like capitalism cannot be at root “anarchic” in many of its operations, are misplaced. There are conspiracies all the time, little ones. Big ones tend to spring leaks however, and few are likely to believe in one that has lasted 250 years without being "outed". The capitalist class is not a conspiracy, not because it is open and, more or less, above board, but because it is not united, as the Illuminati presumably are. Because of the anarchic, competitive and contradictory nature of capitalism a conflict-free “New World Order” is practically impossible.

the Roma in the Czech republic

2011-09-26T06:19:00.003+01:00

Jindich Nestler wouldn't call himself a racist. "The good gypsies can stay," he says. "But most of them are lazy or criminals or even terrorists. They have to disappear."

Nestler is a 36-year-old official of the far-right "Workers' Party for Social Justice," or DSSS, by its Czech initials. DSSS is a successor party to the neo-Nazi group Dlnická Strana (DS), which was banned a year and a half ago by the highest Czech administrative court. One reason the court gave for the ban was that Dlnická Strana organized rallies that led to pogrom-like riots against the Roma.

Around 250,000 Roma live among 10 million Czechs. There are 300 slums around the country. Several can be found in big-city centers. Real-estate companies pay the Roma -- or offer to forgive their debts -- if they abandon potentially lucrative buildings in city centers and move to remote regions near the German border. The companies even bring them to specific abandoned houses, then charge high rents -- or even claim welfare subsidies directly from the state.

Some homeowners "exploit" the Roma, says Martin Šimáek, director of a state agency for social integration. Real-estate speculators charge them unprecedented, sky-high rents and excessive rates for water and power, he says. "This leads to unrest and creates problems for coexistence throughout the entire town," Šimáek told a Czech radio station.

http://www.spiegel.de/international/europe/0,1518,786495,00.html#ref=nlint

Labour Party conference

2011-09-25T23:32:00.001+01:00

“I’ll make capitalism work for the people..." promised Ed Miliband during his successful campaign to become Labour leader. Workers have heard this all before. The Labour Party has always tried to make capitalism work for the people. And every time that it has been in office, it has failed miserably to do so. The reason Labour – and indeed the Tories who also talk of a “people’s capitalism” – fail to make capitalism work for the people is that this is an impossible mission. Capitalism just cannot be made to work in the interest of all. It is a profit-making system that can only work as such, in the interest of those who live off profits.

The driving force of capitalism is the accumulation of capital out of profits. When this slows down, as at present, there is a crisis. So, governments must not do anything that might discourage the making of profits to accumulate as capital; in fact, even if it wasn’t their original intention they have to end up doing all they can to encourage this. Inevitably, this brings them into conflict with the wage and salary working class whose labour is the source of profits, imposing wage restraint and/or austerity on them. All governments have to put profits before people because capitalism, the system within which they have to work, runs on them.

The Labour Party has failed, so let’s start a new one. That’s what some trade unionists and leftwingers are saying. But why? Surely one of the lessons of the 20th century has been that Labourism is a dead end. It can’t succeed. Not because its leaders are insincere or incompetent or corrupt or not resolute enough. It fails because it sets itself the impossible mission of trying to gradually reform capitalism into socialism. This can’t be done, as experience, not just theoretical understanding, has confirmed. The last thing that is needed today is a non-socialist, trade-union based “Labour” party. We have seen the past and it doesn’t work.

In February 1906, the fledgling Labour Representation Committee (LRC), under the leadership of James Keir Hardie renamed itself and the Labour Party came into being. The Labour Party consciously steered the social-democratic or socialist movement of the early twentieth century away from social revolution to a futile policy of ‘reformism’, maintaining unswerving support for the exploitation of working people, the wages system, commodity production and the private ownership of the means of producing wealth. It had relied on a cynical propagation of the pretence that state-run capitalism and reforms represented "stepping stones" to a socialist society and what emerged from those years of reformist efforts was not a slowly evolving socialism but a Labourism which increasingly judged itself by the success of the one thing it could do in government – manage capitalism; all reformist baggage what emerged from years of reformist efforts was not a slowly evolving socialism but a Labourism which increasingly judged itself by the success of the one thing it could do in government – manage capitalism; The myth of nationalisation as an answer to the problems of capitalism beng more or less dead and all reformist baggage being abandoned in the pursuit of Labour's desire to manage capitalism better than the other lot. The Labour Party engineered its own metamorphosis, re-branding policies and redefining its agenda. The commitment to nationalisation enshrined in the 1918 Party constitution was abolished and Trade Union influence over policy – always more mythical than real – was publicly abandoned. Its image, thus transformed, seemed revitalised and business, media and the electorate acclaimed the party that now called itself New Labour.

If there are with two other people and the first one of them is openly hostile, abuses you at every turn and is obviously working for interests diametrically opposed to your own, you would have to be crazy to consider them a friend. But if the other person keeps telling you that they are on your side, sympathises about how awful the first person is being, and says you should trust them instead – while all the while they are pursuing interests just as opposed to yours and will proceed to stab you in the back at the first opportunity – then who is your real friend? Neither of them is the answer, of course, though we can say that you are less likely to be deceived by the openly hostile one. The function performed by the Labour Party is always to appear as the benign friend to the workers in distinction to the “wicked” Tories. Hoping that the Labour Party will behave differently is an unrealistic – indeed utopian – expectation. Any party that tries to run capitalism gets its hands grubby, as a matter of course, in what is a very dirty business. Voters vote governments out because they appear incompetent, incapable of finding solutions to the daily problems that confronts wage and salary earners. But government can never solve these problems because their permanent solution lies only in the abolition of capitalism and the wages system. Economic laws that politicians are powerless to change and leave little room for manoeuvre determine what politicians do and how they must react. The policies propounded by Tory or Labour are similar because they are manifestations of the same political imperative – a continuation of capitalism – and are distinguishable only to the extent that they propose different organisation methods to administer the same economic system. In misguided expressions of defiance that flow from frustration and lack of understanding, voters repeatedly swap Labour governments for Tory, or Tory governments for Labour - as they have on eight separate occasions since the second world war – in the hope that it will somehow make a difference.They are always disappointed by the outcome. How often have disillusioned Labour supporters and voters cried “betrayal!”?Mandating a political party to administer capitalism means that workers surrender political power to their class enemy - a lesson that workers seem unable to grasp as the same mistake is slavishly repeated over and over again.

Now as the natural conclusion to reformism has completely overrun the Labour Party , they are a simple party of capitalist maintenance, with objectives of some form of new society being not just shunted into the background but completely out of existence. They are now more dedicated than ever to running with optimal efficiency the very system that creates poverty, misery, homelessness and war. As for those old Labourites who blame all on the mistakes of the past and present on certain leaders, this simply adds to the argument against leadership. In any case, the leader as a individual is irrelevant. Knocking one leader out of office and replacing them with another won’t change the system, and it’s the system that all attention should be focused on if we desire a radical change in the way we live.Trading one group of pro-capitalist apologists and careerist politicians for another can never be the answer. Changing society’s economic structure is the answer.

Chinese State-Capitalism

2011-09-23T05:51:00.000+01:00

90% of the 1,000 richest people tracked by the Hurun Report are either officials or members of the Chinese Communist Party.

The most important and lucrative sectors of the economy have been reserved for state-owned-enterprises (SOEs)...SOEs are run like private corporations, seeking to maximise profits. They made an estimated 1 trillion yuan ($150.83 billion) in net profits in 2010...In the first half of last year, the four state-held commercial banks alone raked in an average of 1.4 billion yuan ($211.16 million) a day....
http://www.asianews.it/news-en/Communist-Party-controls-wealth-and-big-state-owned-enterprises-20626.html

Almost all of China’s richest people have made their money in state-dominated sectors, such as property and construction, resources, other heavy industries and telecommunications. This could be through preferential access to the best land (often seized illegally from citizens) for property developers, privileged access to below market rates of capital, or special access to raising capital or equity in listed SOEs. In almost all cases, those benefiting are CCP officials or members...

...the 150 centrally managed SOEs owned two-thirds of all fixed assets in the country, while their revenues amount to about half of the revenues generated by all Chinese firms each year...over two-thirds of board members, and three quarters of senior executives of SOEs are either CCP officials or members...

...While SOEs have increased their revenues by 20 to 30% each year, mean household income has increased by a paltry 2 to 3%...

...One of the keys to the Party's power base is that it retains control of material, career and professional opportunities. This may be good news for the growing ranks of the mega-rich but not the majority of the Chinese people who can't get a foothold on the social ladder...
http://www.forbes.com/2011/09/14/china-rich-lists-opinions-contributors-john-lee.html

At the March National People’s Congress 70 of the 2,987 members had a combined wealth of 493.1 billion yuan ($75.1 billion). By comparison, the wealthiest 70 people in the 535-member U.S. House and Senate, who represent a country with about 10 times China’s per-capita income, had a maximum combined wealth of $4.8 billion.
Rupert Hoogewerf, the director of research for the Hurun Report, said there are likely more dollar-billionaires in the NPC. For every one among the 189 the company identified in all of China, mainly through company filings, he estimates there’s another whose wealth remains hidden from the public. For every yuan billionaire, he estimates they’ve missed two. “There will be individuals on the NPC that just haven’t come to the surface,” Hoogewerf said. “There’s a lot of hidden wealth in China.”

Li Zhaoxing, a former foreign minister and spokes person for the National Party Congress said “I have found around me many good citizens who have gotten rich through their own hard labor and intelligence.” - Just as often claimed by Fox TV's Bill Reilly !!!

23.5 percent of the 1,000 richest Chinese individuals' fortunes comes from the property industry, up from last year's 20.1 percent. The rentiers

Liang Wengen, chairman of China's heavy machinery giant Sany Group, has been named the wealthiest person in the Chinese mainland. His personal fortune totaled 70 billion yuan.

division of labour

2011-09-22T06:37:00.001+01:00

Doctors and nurses appear to work harmoniously together but the traditional role of the doctor as the dominant professional means nurses face both structural and professional inequalities. The nursing profession is denied opportunities to contribute to patient care and that hinders the development of equal and collaborative working relationships. Evidence suggests when nurses and doctors work as equal partners, patients have better health outcomes. If you pay a visit to your local doctor, there’s a good chance you’ll spend some time with a nurse.

Nurses in general practice provide specialist health services, education and advocacy. For patients with long-term health complaints, having a nurse involved in care can improve health outcomes and have increased patient participation in continuing care and encouraged lifestyle changes. The general practitioner has traditionally been the sole custodian of care but as the number of nurses in general practice increases, it’s likely that this traditional role will be challenged.

Nurses who enter the workforce today are prepared for clinical independence, critical thinking, and professionalism. No longer do they view themselves as doctors'“handmaidens”. Nor are nurses substitute doctors in general practice – they meet the needs of patients by approaching problems in a different way. They seek to understand how a person is experiencing both their health and their illness so the nurse acts as an advocate for the patient. Collaborative partnerships between nurses and doctors in general practice will result in comprehensive primary health care – the beneficiaries will be patients and the community.

A poor view on life

2011-09-22T06:05:00.003+01:00

The poor, we're taught to believe, will always be with us. A good many of the poor have jobs, but receive too little pay to lift their family up from poverty. One in six Americans lives in poverty, more than 46 million. Twenty-five million people are in need of full-time work; 49 million go without health insurance excluded from a health-care system that is twice as expensive, per capita, as those in other industrial nations, captured by the drug lobby and the insurance and private hospital industries.

Poverty is destructive. The poor are more likely to be sick, vulnerable from hunger, to lack prenatal and infant care and to contract diseases that go undiagnosed. But if being poor makes Americans sick, getting sick too often makes them poor. Serious illness is the leading cause of bankruptcy. Poverty destroys hope. A hungry child finds it hard to learn. A toothache drowns out a teacher's voice. As poverty rates increase, the number of dropouts rises. Poverty destroys neighborhoods. Foreclosed homes become drug dens. The desperate turn to crime. Exploiters - the payday lenders, the sub-prime peddlers - target the vulnerable. The poor are less likely to have access to transportation that might take them to a job. They are less likely to have access to affordable groceries. They are more likely to go to an under-funded school, from which the best teachers have fled. The working poor are more likely to be in debt, more likely to live paycheck to paycheck.

The Chairman of Merck was paid $17 million last year, a period during which his company laid off considerable employees. Bank of America's chairman was paid $10 million, and that’s being paid for in part by the laying off of 30,000 workers. The 400 richest Americans got 12% wealthier.

Lets change the world

adapted from here

some more party graphics

2011-09-21T16:47:00.010+01:00

A few quotes

2011-09-21T06:36:00.002+01:00

Buddha said: "Thousands of candles can be lit from a single candle, and the life of the candle will not be shortened. Happiness never decreases by being shared"

Chomsky said: "There are no magic answers, no miraculous methods to overcome the problems we face, just the familiar ones: honest search for understanding, education, organization, action that raises the cost of state violence for its perpetrators or that lays the basis for institutional change -- and the kind of commitment that will persist despite the temptations of disillusionment, despite many failures and only limited successes, inspired by the hope of a brighter future."

Einstein said: "The definition of insanity is doing the same thing over and over again and expecting different results."

co-opting co-ops

2011-09-18T06:30:00.002+01:00

In the minds of many workers the co-operative movement is regarded as being in some way linked up with socialism. The theorists of the original co-operative movement saw it as a movement that would eventually outcompete and replace ordinary capitalist businesses, leading to the coming of “the Co-operative Commonwealth” (which was an alternative name for socialism). They would constitute, as it were, little oases in the desert of capitalism. They anticipated that the movement would grown until finally the workers would have achieved their emancipation. Essentially society was to be transformed by means of experimental communities. Each community would own its own means and instruments of production and each member of a community would work to produce what had been agreed was needed and in return would be issued with a note certifying for how many hours he had worked; he could then use this note to obtain from the community's stock of consumer goods any product or products which had taken the same number of hours to produce. (G.D.H. Cole was another who wrote on what he called “Guild Socialism”. Although Cole’s blueprint did provide for close links between consumers and producers which could be interpreted as “production directly for use”, it still envisaged the continuation of finance, prices and incomes. And it was to come into being through the guilds eventually outcompeting capitalist industries in the marketplace)

We know what happened. This was because they had to compete with ordinary capitalist businesses on the same terms as them and so were subject to the same competitive pressures, to keep costs down and to to maximise the difference between sales revenue and costs (called “profits” in ordinary businesses, but “surplus” by the co-op). The co-operative movement was outcompeted and is now trying to survive on the margin as a niche for “ethical” consumers and savers, leaving the great bulk of production, distribution and banking in the hands of ordinary profit-seeking businesses. Co-operativism did not provide a real solution to the workers' situation. It was incapable of providing an answer in the interests of all workers. At no time did it question the capitalist production relationships - it questions only superficial features (monopolies, competition, etc.). The co-operative movement cannot solve the basic economic problems of the workers as a whole, or even of the co- operative societies' own members. Where it was a success it was merely the success of essentially capitalist undertakings.

Co-operatives can only ever involve a minority of workers, and the more they are integrated into the capitalist economy and its profit- seeking, the more their members will have to discipline and pressurise themselves in the way the old bosses did - what is known as "self-managed exploitation". The fact is that there is no way out for workers within the capitalist system. At most co-operatives can only make their situation a little less unbearable.

Owen believed that his co-operative commonwealth could begin to be introduced under capitalism and in the first half of the 1830s some of his followers established "labour bazaars" on a similar principle: workers brought the products of their labour to the bazaar and received in exchange a labour-note which entitled them to take from the bazaar any item or items which had taken the same time to produce, after taking into account the costs of the raw materials. These bazaars were failures but the idea of labour-time vouchers (or "labour-money") appeared in substantially similar forms in France with Proudhon and in Germany with Rodbertus and is one source of currency crank theories.

They were not money at all, but merely a method of sharing out consumer goods. As Marx said of the Owenites' plan for a co-operative commonwealth: Owen's "labour-money", for instance, is no more "money" than a ticket for the theatre. Owen presupposes directly associated labour, a form of production that is entirely inconsistent with the production of commodities. The certificate of labour is merely evidence of the part taken by the individual in the common labour, and of his right to a certain portion of the common produce destined for consumption. Engels says much the same in his comments in Anti-Duhring on Owen's labour-notes.

Writing in 1875 Marx had to concede that, in the early stages, consumption would have to be rationed and he suggested this be done by means of labour-time vouchers, but specifically said that these would no more be money than a theatre ticket was, but eventually all goods and services would be free for everybody to take according to need. Today, nearly a hundred years later, this stage could be reached very rapidly once socialism/communism had been established. In one of his criticisms of the Gotha Programme which was adopted by the German Social Democrats in 1875 when the followers of Lasalle united with the group with which Marx and Engels had been working. In the course of this criticism Marx made his well-known statement about labour-time vouchers in socialism ("not as it has developed on its own foundations, but ... just as it emerges from capitalist society"):
"The individual producer ... receives a certificate from society that he has furnished such and such an amount of labour (after deducting his labour for the common funds), and with this certificate he draws from the social stock of means of consumption as much as costs the same amount of labour. The same amount of labour which he has given to society in one form he receives back in another."

Supporters of state capitalism have used this passage to try to show that Marx thought that money could exist in socialism. This is so much nonsense since elsewhere Marx specifically stated that labour-time vouchers were not money:
"The producers may ... receive paper vouchers entitling them to withdraw from the social supplies of consumer goods a quantity corresponding to their labour-time. These vouchers are not money. They do not circulate."

Marx nowhere states that labour-time vouchers were the only method of distributing wealth in socialism; they were only one possible method. The actual method adopted would depend on the circumstances . Alternatives were suggested, as for instance by Edward Bellamy in his Looking Backwards written in 1887 who wanted everybody in socialism to be issued with a credit card entitling them to obtain an equal amount of consumer goods. In any event, later on in his criticism of the Gotha Programme Marx made it quite clear that if labour-time vouchers were used in Socialism this would be a temporary measure imposed by the comparatively low level of technology. In time, he saw, when the "springs of co-operative wealth flow more abundantly" Socialist society could abandon labour-time vouchers (or whatever) and go over to "from each according to his ability, to each according to his needs", that is, to free access to consumer goods.

In 1875 the then existing level of technology might well have meant that many consumer goods would unavoidably be available only in limited quantities for some years after the establishment of Socialism. But in the hundred years since, technical progress has made it possible for the springs of co-operative wealth to flow more abundantly than Marx could have foreseen so that free distribution-to each according to his needs-can be implemented almost immediately after Socialism has been established. Potential abundance has made the idea of labour-time vouchers quite outdated. For Marx there was no "must" about labour-time vouchers (and so more or less "equivalent exchange"); they were just one possible way of allocating consumer goods before free access could be introduced.

The 60/70s group Solidarity advocated a self-managed market economy blueprint published as Workers Councils and the Economics of A Self-Managed Society, a long article originally written in 1957 by Cornelius Castoriadis . This pamphlet painted a picture of factories and other workplaces being controlled by elected Workers Councils in the context of the continuation of the money-wages-profits system. Thus, in a given factory, the workers would elect a Council which would decide on the level of wages, the price of the product, the amount of profits to be re-invested, etc. This was Solidarity's conception of "socialism"; which would never work - either because if the working class had reached the degree of consciousness needed to establish it then they would establish real socialism instead or, if they hadn't, then it would degenerate into some kind of state capitalism. It was the completely impractical idea of direct workers' control of a capitalist economy. They put all the emphasis on "democratic control" or, as they put it, "self-management", and believed that this could be achieved without ending the money-wages-profits system which is the essence of capitalism. Socialism is not just concerned with emancipating workers as workers (i.e. wealth-producers) but as human beings (i.e. as men and women). Socialism aims not to establish "workers power" but the abolition of all classes including the working class. It is thus misleading to speak of socialism as workers ownership and control of production. In socialist society there would simply be people, free and equal men and women forming a classless community. So it would be more accurate to define socialism/communism in terms of the common ownership and democratic control of the means of production by and in the interest of the whole people. "Workers council" would have been a misnomer since socialism, being a classless society, involves the disappearance of the working class just as much as of the capitalist class. "Democratic councils" would have been a more appropriate term. A society where the means of production belong to everybody and run by democratic councils, that's socialism.

As long as capitalism lasts workers will have to find a source of money one way or another and so will always be in a dependent and precarious position. A number of lessons can be drawn from the recuperated enterprises movement in Argentina in. Firstly, that built into capitalism is a class struggle between those who own the means of wealth production and those who don't and who are therefore forced by economic necessity to sell their ability to work to those who do. This class struggle is not just over the price and conditions of sale of the commodity workers are selling. Ultimately, it's about control over the means of production. If, as happened in Argentina after the economic melt-down of December 2001, capitalists abandon their factories or, as happened in Russia in 1917, Spain in 1936, and Hungary in 1956, the capitalist state is temporarily incapable of protecting capitalist property, then the workers more or less spontaneously take over their workplaces and keep production going. Workers are not going to let themselves starve: if the means of production are there, and there's no state to stop them using them, they'll go ahead and use them, even if they have no revolutionary pretensions. However, as soon as the state has re-gained its strength again, then it is in a position to confront the workers and re-instate its authority and re-impose property ownership laws to the means of production only on its terms. Which leads to the second lesson: the importance of who controls the state. At the moment, in Argentina as elsewhere, this is in the hands of people favourable to the continuation of capitalism, itself a reflection of the fact that most workers too don't see any alternative to capitalism. The state, therefore, upholds legal private property rights. The importance of political power is in fact fully recognised by the recuperated enterprises movement. This is why they are calling for the law on property rights to be changed so as to recognise the property rights of the workers cooperatives which are running recuperated enterprises; which will only happen if they can get the elected law- makers to do so, either by pressuring them from outside or by electing ones favourable to a change in the law.

The end of capitalism can only come as a result of a consciously socialist political movement winning control of political power with a view to abolishing all capitalist property rights and ushering in the common ownership and democratic control of the means of production. The preconditions for ending capitalism are a majority socialist consciousness and workers democratically self-organised in a large-scale socialist party. Neither of which, unfortunately, existed in Argentina. Which is why the recuperated enterprises movement there has proved a dead-end and why the workers cooperatives it gave rise to are now forced to compromise and integrate themselves into capitalism to survive.

Until Tomorrow

2011-09-17T04:57:00.001+01:00

A 1961 sci-fi short story from the Socialist Party of Canada

"The destruction was so near complete that plant and animal life crept back over the earth slowly. The soil itself was to a great extent polluted by the fall-out. But that portion of humanity which escaped was truly fit, and brought with it memories, and a resolve never to repeat the fatal mistake of society divided against itself."

The speaker was Hubert Brodkin, venerable sage and keeper of the archives; the time, the year 1000 A.H. (after the holocaust); the place, Entrada Island, large western neighbor of a country once called Kanata. Professor Brodkin's listeners, several thousand in number, were gathered on the sea-shore and along the sandy estuaries of two great rivers; yet so near perfect was his voice transmitter that all could have heard had he spoken in a whisper. Behind them lay a lush land and all shared in common those things commonly used. There was plenty for all, with no rich, no poor, a fulfillment of the dreams of ancient dreamers called "Utopians," whose very names were forgotten.

"Warnings of the impending catastrophe," continued the professor, "were given about the year 1950, in what was then referred to as the 'Christian Era.' But the great mass of people were indifferent, and left all vital matters to those few who held them in complete subjection and who were spoken of as "experts." The particular economic and social period was described variously as 'Rugged Individualism,' 'Democracy,' and 'A Way of Life.' Five per cent of the population came into control of ninety-five per cent of the world's wealth, and so well did they command communication and silence opposition that the major portion of mankind was thought-controlled. It was a time of hand-clapping, of slogans, catch-words and phrases. Imitation came to be regarded as talent. Mouth-gurgling passed for music. From talking and thinking alike people began to look alike, to resemble in certain measure a famous dummy of the time called 'Mortimer Snerd.' And so tractable had they become that the dominant few, drunk with power and greediness could play with them as an angler plays with a hooked fish. This mass inertia tempted the world's dictators to lead it on into events so terrible that today's descriptions are dumb. People and records went down to destruction together, and what little I can tell you was passed on mainly by word of mouth from those few who survived to their descendants."

Here, onward, Professor Brodkin's style of speech became broken now and then by a slangy idiom echoing, so to speak, out of some forgotten time with which he alone seemed in tune:

"The circus began in this section of the earth after a number of sailing ships unloaded their razzle-dazzle biped freight. They struck a wild land inhabited by Primitives. Each ship's company consisted of a small number of Grabbers and a large quota of Goofs. The Grabbers were OK, they were wise cookies. The Goofs were everything else. Unlike Mother Hubbard, they were at once both poor and lacking in ambition. So long as they could eat, sleep, and breathe air in and out they were satisfied. The Grabbers sicked the Goofs onto the Primitives. The Goofs advanced in three columns. Some members of the first unit rode horses. Others bore guns, powder, and lead. Such gentry were described in a future time as 'Liberators.' Their combined attack appalled the Primitives who fought back as best they could with stone hatchets, bows and arrows. The front section of the second column carried a huge white cross on which the skeleton of a man was spread — this terrorized the Primitives. Now followed closely a group clad in long black coats, and carrying large books in their hands — these hypnotized the Primitives and softened 'em up for the third company. These sweet-scented gentlemen lugged kegs and jugs filled with a fiery fluid which sent the blood racing through the natives' veins, causing them to dance and whoop 'er up in wild fashion.

"Ground had now been broken for the Grabbers, who arrived plentifully supplied with mouse-traps, miscellaneous trinkets, and muskets made of cast-iron that later were to burst in the natives' faces. The Grabbers had an eye on four-footed animal skins in the possession of the Primitives. Spaniards called the procedure 'Negocio,' Englishmen dubbed it 'Business Incentive,' which term in after years was to ripen into 'Free Enterprise.'

"When the process of skinning the Primitives who had skinned the quadrupeds was well advanced and both were all but exterminated, the Grabbers divided the country amongst themselves, drove stakes and built fences around their allotments, then posted signs proclaiming this land is the private property of Grabber So-and-So and trespassers will be severely dealt with by virtue of 'Constituted Authority.' This latter sounded awesome to the Goofs, and since it was printed in large capitals they had not the temerity to question matters; especially when a number of the bigger Goofs were dressed in uniforms, armed, and sworn to obey the rules laid down by Constituted Authority.

"A 'Culture' period now followed in which the Goofs were taught to sing patriotic songs, and told how lucky they were to be living in Kanata. It was driven home to them how badly the Grabbers of other lands treated their Goofs.

"Then, when the landless, propertyless Goofs had no alternative, they made a deal with their overlords by which they (the Goofs) could live on the lands and do all the work, cut the timber, build the houses, grow the crops, raise cattle, build dams, factories, power plants; in brief, do everything necessary to keep the Grabbers in clover.

"The society developing out of this lopsided partnership became finally an insane mechanism in which the parts operated against the whole. Each family of Goofs desired the elimination of its neighbor. Each group hoped for the misfortune of other groups. Everywhere, individual interest took precedence over public good. The lawyer wanted litigations, particularly among the rich. The physician wanted sickness — he would be ruined if everybody died without disease. The military man wanted wars that would carry off half his comrades and secure him promotion; the undertaker wanted burials; farmers wanted famine to double, or treble the price of grain; the architect, carpenter and mason wanted conflagrations. It was truly each against all. The era was described by a noted philosopher, Bertram Dresser, as 'Graboofia.' Indeed it is to Dr. Dresser that we are indebted for much of the information handed down. And it all added up to a survival of the slickest.

"This charming result was affected by the Goofs surrendering to the Grabbers at the point of production their entire product, and receiving wages sufficient merely to restore the energy to work. Surplus values retained by the Grabbers had to be sold in order to provide them with profit, ease and luxury. Fully half the Goofs were now put to advertising and unloading the loot. But due to a world wide expansion of technology the Grabber gangs of most lands had surpluses to sell. Markets shrunk and rivalry between the great robber groups grew bitter. In the frantic search for trade they ferreted out all potential customers. It was at this point that propaganda ran rife and military build up sky-rocketed. It was a carnival of name-calling; when interests clashed the other fellow became a 'Red,' a 'Black,' a 'Blue,' or a 'Communist.' Each Grabber group would trot out some new weapon, expecting all opposition to collapse in fear; but instead, some one of them would come up with an even newer and better instrument of destruction. More than half the Goofs' labours were devoted to this end.

"From early youth Kanatan Goofs had been taught that one of their number could whip any six foreigners. Was not this well proven by that affair with the Primitives? True, the Goofs had stuck knives on the ends of their guns to avoid getting too close to the enemy with his short knife; but all's fair when glory is to be won!

"As to the Grabbers, they never intended to do any fighting, and had hideouts for themselves prepared in advance. And they planned all along to instruct their principal servants to prepare, in the name of Constituted Authority, documents ordering the Goofs to advance against their foreign counterparts whose own Grabbers had been designated as enemies. So powerful and so few in numbers had the world's Grabbers become, they could start and stop isolated wars at any time without those who fought knowing who was responsible. Surviving Goofs, returning victorious were rewarded with medals and cement monuments. and 'Remembrance' days. And they were a long time complacent. They believed the few in control of the earth were fearful of launching an all out chemical and germ war lest they themselves perish in the process.

"Step by step, many Goofs began to realize the sheer lunacy of Graboofia. They visualized a tomorrow, with a way of life where each against all had given way to a world of one for all and all for one. They realized they outnumbered the Grabbers 1000 to 1 and had the power to change the world, if they had the determination.

"But an effective job of head-fixing had been accomplished by the authorities through their control of the powerful means of spreading ideas; the schools, the church, the newspapers, the movies, the television. Those Goofs striving to change the world were pictured as enemies of individualism, free enterprise, liberty and democracy. Yet there were signs of rumbling and a growing awareness of a better tomorrow. Then somewhere, some one committed a 'hostile' act, and the terrible, indiscriminate destruction broke out. Unbelievable secret devices of death came out of concealment. Millions of men, women, and children were killed or maimed, blinded and rendered insane. A creeping death enveloped the entire earth. Almost everything wilted before it. Some of the people found refuge in caverns, others in sheltered nooks near sea-level. Communication, except the more primitive kinds and the printed word were lost as survivors slipped backward toward savagery. But the story of mankind before the holocaust (thanks to story-tellers like Dr. Dresser) was not lost completely, nor was the belief that some tomorrow would bring forth a fuller life."

As the professor's voice died away the Islanders rose slowly from the sands and headed homeward. The disappearing sun, seeming also content had painted the horizon a rosy red and bridged the sea-water with a streak of light which now retreated swiftly with the seconds, like the flashing smile of some departing guest — departed until tomorrow.

by ROY DEVORE

trials

2011-09-15T09:14:00.008+01:00

On the banks again

2011-09-13T06:04:00.001+01:00

There are three main divisions within capitalist society which share the surplus-value which is socially extracted from the working class; the industrialist, the landlord and the banker. These divisions historically reflect the application of the division of labour to the specialised investment of capital in any field of production and distribution, any process of circulation, of which banking is part. Banks produce nothing. They are really middlemen or custodians of idle capital which must be available as a hoard, as potential money capital waiting to be put to use. Their profit is made during the process of circulation. The difference between finance capital and industrial capital is that the owner of money capital who wishes to earn interest on that money throws it into circulation not as capital for himself, but so that others can use it; and consequently gains a profit by this service.

Contrary to popular belief, banks do not dominate the capitalist system (The two largest corporatrions in the world are WalMart, bigger than the Pakistan and Exxon bigger than the New Zealand economies). In the list of companies by revenue size the first financial business enterprise to appear is Fannie Mae at number number 16. This mistaken view is due to the fact that wealth is represented by enormous quantities of money. All wealth under capitalism expresses its value in the symbolic money form, but that form tends to conceal the fact that capital exists in the physical implements of the labour, factories, minerals, buildings, ships, etc. If for some reason, whether it be that the market is already overloaded and cannot absorb further commodities, or that over-production has already taken place, then production will be scaled down, curtailed, or in some cases halted entirely, and workers will be laid off. In these circumstances there will be little prospect of profit, and as experience has shown a number of capitalists, the smaller ones, go bankrupt All the machinations of the banks, either by advancing or retarding credit, whether charging low interest rates or not, cannot alter this. At the moment there is no shortage of cash available for investment. However, in a failing market there is little incentive to the industrial capitalist to commit himself to paying interest when the prospects of earning surplus-value on the borrowed money are extremely remote.

Speculation basically involves buying cheap and selling dear. When it comes to banking, what banks are doing is borrowing money cheap and lending dear, pocketing the difference as profit. Basically the same as any merchant who buys below value but above the cost-price of the producer of the commodity, and then sell above their own cost-price. There is nothing very specialk about banks; they are not wicked finance capitalists against whom the anger of workers should particularly be directed, just capitalists with their capital invested in a particular line of business, no more nor less reprehensible than the rest of the capitalist class.

Banks lend money and charge interest on it, but they don't create this money themselves but many have come to accept a myth that banks can create money "out of thin air." No, they can't. They can only lend out either what has been deposited with them or what they themselves have borrowed on the money market.

True, they don't have to hold all of this as cash, but only a very small proportion, as little as 3%. There's nothing dubious about this. It's what banks do - lend money that people and firms don't want to spend for the moment to those who do want to, and making their profit out of the difference between the rate of interest they pay depositors and what they charge borrowers. It is quite true that banks do not have to retain all the money deposited with them in the form of cash. If they did, they would never be able to make any profit, since it is only by re-lending, at a higher rate of interest, the money they have in effect borrowed from their depositors that they make profits. It does not mean that they can lend out many times any amount borrowed by or deposited with them as cash, raking in the interest. It means that they can only lend 97 per cent of this amount.

The money lent, obviously, is spent on something, the proceeds of which ultimately end up back in the banking system and are then available for lending all over again. This is not creating new money out of nothing. It is re-lending already existing money. If the money lent does not return to some bank when spent - and so become part of its assets - then no more loans can be made. So, banks cannot lend out more than they have.

Derivatives, collateral debt obligations and the rest are not relevant here as they are not bank loans or money. They are what Marx called "fictitious capital" - ie the conversion of a stream of interest into a notional capital sum which can be bought and sold. Packaging and selling these was an alternative to lending at interest that the banks found to turn a profit. According to Marx the securities themselves really have no value and represent nothing more than a legal claim to a portion of future surplus-value. So any sale of these assets (at any price) represents a transfer of value from buyer to seller, although assuming that there is no default on the asset it will serve to eventually increase the amount of value in the hands of the buyer. The owner of a financial asset records the asset in his books as if it had a value just like any other commodity. This turned out to be disastrous when it was discovered that the stream of interest was also in many cases fictitious.

If there is one lesson of the current financial crisis it is that banks can only lend out what they have borrowed either from depositors or from their own borrowing on the money markets. It was an over-reliance on the latter that largely led to the collapse of Northern Rock and the near collapse of so many other banks. If banks could really create vast quantities of credit at "a stroke of a pen" then none would ever go bust. Neither would they need to tap the money markets for funds.

The second and most important function of the banker is to provide money for industry, which is capital. This has a separate function from money as the medium of circulation. The function of capital is not merely the circulation of commodities but their production in the first instance. Therefore, money used as capital is withdrawn from circulation because the wealth which it represents has been locked up in the process of production. The credit system of advancing capital allows individuals to use capital which is not theirs, and has opened the door to all sorts of swindles and reckless speculation. Who would not gamble with other people's money?

Credit creationism is a myth first given respectability by the 1931 MacMillan Report on Finance & Industry, though a significant minority of economists, bankers and trade unionists on the MacMillan Committee rejected it, while others later got cold feet when the implications of what they had signed up to became evident. It didn't stop a version of it (later highly amended by Samuelson and others) entering into standard economics textbooks.

One of the origins of the banking system was the practice of depositing money for safe keeping with the goldsmiths and paying them for this service. The goldsmiths subsequently adopted the practice of paying interest to the depositor, and they re-lent the money at a higher rate of interest to a borrower. This was only an indirect way of the depositor himself lending his money at interest to the borrower. Whether the goldsmith acted as intermediary or whether the lending was done directly the general effect was the same, i.e., the owner of the money (representing a command over goods) was lending it to a borrower, who would thus, for a specified time, have at his disposal the means of buying goods. It was not an act of “creating” goods or values, but only of lending them, the banks being intermediaries between lenders and borrowers. Fundamentally, the same process underlies the modern banking and credit system. Many proponents of the credit creation myth repeat the goldsmiths allegory as proof of creating money "out of thin air" but as this more or less contemporary account makes clear there is nothing about the goldsmith banker being able (or even trying) to lend more than the 100,000 ounces of silver deposited with them, as often ascribed in the many web accounts.

It's from Richard Cantillon's "Essai sur la nature du Commerce en General" written in 1730. Here's what he wrote:

"If a hundred economical gentlemen or proprietors of land, who put by every year money from their savings to buy land on occasion, deposit each one 10,000 ounces of silver with a goldsmith or banker in London, to avoid the trouble of keeping this money in their houses and the thefts which might be made of it, they will take from them notes payable on demand. Often they will leave their money there a long time, and even when they have made some purchase they will give notice to the banker some time in advance to have their money ready when the formalities and legal documents are complete.
In these circumstances the banker will often be able to lend 90,000 ounces of the 100,000 he owes throughout the year and will only need to keep in hand 10,000 ounces to meet all the withdrawals. He has to do with wealthy and economical persons; as fast as one thousand ounces are demanded of him in one direction, a thousand are brought to him from another. It is enough as a rule for him to keep in hand the tenth part of his deposits.
There have been examples and experiences of this in London. Instead of the individuals in question keeping in hand all the year round the greatest part of 100,000 ounces the custom of depositing it with a banker causes 90,000 ounces of the 100,000 to be put into circulation. This is primarily the idea one can form of the utility of banks of this sort. The bankers or goldsmiths contribute to accelerate the circulation of money. They lend it out at interest at their own risk and peril, and yet they are or ought to be always ready to cash their notes when desired on demand. If an individual has 1000 ounces to pay to another he will give him in payment the banker's note for that amount. This other will perhaps not go and demand the money of the banker. He will keep the note and give it on occasion to a third person in payment, and this note may pass through several hands in large payments without any one going for a long time to demand the money from the banker. It will be only some one who has not complete confidence or has several small sums to pay who will demand the amount of it. In this first example the cash of a banker is only the tenth part of his trade."

Cantillon's full account of how the banks of his time operated can be found in Chapter VI

What is of significance for those who describe thmselves as socialists yet espouse the idea of credit creationism is that runs counter to one of the basic precepts of Marxian economics, namely that value arises in the sphere of production not circulation. If banks could create credit with the stroke of a pen, that would mean in effect they could create wealth, and consequently the Marxist Theory of Value would be shown to be wrong. However, as time passes the validity of the Labour Theory of Value, i.e. that wealth can only come into existence when men apply their energies to nature, is all too apparent. If credit creationism were true, the solution to society's problems would indeed be monetary reform, not socialism - exactly the sort of argument put forward by Major Douglas in the 1930s (see below) to the American libertarian anti-fed reserve conspiracy theorists of today.

The confusion about the role of banks in creating money arises partly because of a lack of clarity as to the nature of money. Money is anything that people are prepared to accept as money and which circulates freely. As youngsters we get to play with toy money. This works perfectly well within the confines of play because players accept it as money and it circulates freely between them. The Bank of England's official measure of the money supply employs a number of different definitions leading to a number of different totals. M0 comprised sterling notes and coin in circulation outside the Bank of England (including those held in banks’ and building societies’ tills), and banks’ operational deposits with the Bank of England. On the narrowest definition the new bank deposits that arise as a result of banks lending money to customers do not count as money. On broader definitions they do. Keynesians and the Monetarists include "bank deposits" as money and that this confuses the issue. Especially as even the term "bank deposits" includes two entirely different types. Most people will interpret the term "bank deposit" to mean money that someone has and that they deposit in the bank, ie in effect lend to it even if they are not paid any interest (but are granted free banking in lieu of this). But the Keynesians and the Monetarists also include as bank "deposits" loans made by banks which take the form in effect of a credit line on which the borrowers pay interest to the banks. So, they mean by "bank deposits" both money that is lent to the banks and money that is lent by them. This involves double counting as some of the money that the banks lend will come from the money that has been really deposited with them.

The continuous concentration of money capital into banks and the expansion of the credit system allows a great number of transactions to take place without the mediation of any money. This is due to what Marx calls the mutual settlement of accounts. If there is a series of exchanges based on credit such that Capitalist A owes £500 to Capitalist B, and Capitalist B owes £600 to Capitalist A, the only amount of money necessary to realize the £1100 of commodities is a £100 -- the £500 owed to each (£1000 in total) are simply canceled on the books and no money is necessary to intervene in the realization of this portion of the value of the commodity capital. The amount of actual money intervening in giant purchases is surely very small. The bulk of purchases take place against credit, where the mutual settlement of accounts is always possible. The move towards a "cashless society" , debit and credit cards, can be seen as increasing the velocity of circulation of the currency.

Ultimately money will only be acceptable and circulate freely if people using it have confidence in it. That is why, for so much of modern history, money has either contained precious metals or has been a token representing a call on precious metals. Today a country's currency depends not on how much precious metal backs it up, but on how productively powerful its economy is.

The one institution which appears to create credit is the State, operating through the Bank of England. This is an act of deliberate political policy. The Government, in a variety of ways, instructs the Bank of England to print an excess of paper currency, which the Government uses to finance its own schemes, and without having to introduce tax legislation to deal with particular cases. This inflation of the currency does not, nor cannot, add to existing wealth. What is really happening is that, far from creating credit, the Government is confiscating other people's. This has the same effect as a general increase in taxation. The constant dilution of the purchasing power of money by inflation raises prices and dislocates production and distribution. This is public fraud posing as public credit.

Socialists have no love for banks. A world without banks would be a wholly better place. However to blame the banks for creating our debt-ridden society is just too biblical, like a re-run of Christ expelling the money-changers from the temple. Even if the banks were state-owned, they would still have to lend. If they didn't there would be no point in them existing. Banks and interest are not the villain of the piece but capitalism and production for profit. We need to abolish money before we can get rid of banks. But to get rid of money we need an end to property. And you can't abolish property relations until you abolish capitalism.

Historically, we have the Douglas Scheme of the 30s which did cast the banks as the villain and variants of the belief frequently spring up.

The Social Credit movement was started by Major Douglas whose argument was that there was a ‘chronic shortage of purchasing power’ due to the issue of money being in the hands of banks that had a vested interest in keeping money in short supply so as to be able to command a higher rate of interest on the money they lent out. Although, according to Douglas, banks had the power to create credit with the stroke of a pen they generally chose not to do so; this power should therefore be taken from them and vested in some public body which would make this extra purchasing power, supposedly needed to ensure the full use of productive capacity, available to all in the form of ‘social credit’. Take this power out of the hands of the banks that they use for their own special benefit, and transfer it to the Government and with this power, it can issue certificates, based on the national wealth, entitling all citizens to a share of the goods so abundantly produced in this age of plenty. Thus, the working class will get a greater portion of the wealth it produces, and the petty bourgeois will get a greater portion too, but what is more, though this is not explicitly stated, the small businesses will escape the clutches of its arch enemy ... the financial institutions.

Marxian economics constitute a direct refutation of the illusions up on which Social Credit doctrines are premised. Not only did Marx demolish the "credit creation" theories but this was already a hoary fallacy when John Stuart Mill disproved what he described as this "confused notion" in a work written before 1847 and published' in 1872. The notion that an insufficiency of money was the cause of sluggish trade was criticized by Sir Dudley North in 1691 before the development of the modern credit system and this was quoted by Marx.

Among other things what this theory overlooked from its deficiency of purchasing power standpoint was that interest charged by banks to capitalist firms is not an additional amount that is added to prices and which therefore cannot be paid for out of current income (wages and profits) generated in production. It is instead a part of the surplus value which the industrial capitalist has to hand over to the banking capitalist for the loan of their money and so is already included in total purchasing power.

It is as we shall see, an inadequate conception of the function of money and its relationship to commodities that underline Social Credit proposals. Money was shown by Marx to be, like labor power itself, also a commodity. Gold, or any of the previous materials that assumed the money form, did so, first of all precisely because they are commodities, and hence depositaries of exchange values. One of these commodities by general usage and agreement becomes the money commodity. By virtue of having the attribute common to all other commodities, of being the embodiment of so much labor time, the money commodity thus becomes the general equivalent and measure of value of all the other commodities. Money emerged and acquired its function of medium of circulation as a product of the historical development of exchange. The primitive inter-tribal direct barter beginnings of exchange was only of an occasibnal and non commodity nature since in primitive society goods were not originally produced for exchange, or sale. But occasional barter between one tribe and another developed into a more sustained form and provided an impetus to the development of the private property institution. Goods became more and more produced for the purpose of exchange, rather than for the personal use of the owners. The beginnings of commodity production and exchange, the production of goods for sale, demanded the use of one commodity as the universal equivalent which would serve as the translator of the values of all the others. It will be seen then that exchange did not originate with money but that the converse is true; i.e. that money arose as a medium of circulation only as a result of the circulation of commodities. At this point let us allow Marx to speak. "Although therefore the movement of money is merely an expression of the circulation of commodities it seems as if conversely the circulation of commodities was only an outcome of the movement of money. On the other hand money only has the function of a medium of circulation because it is the objectivized value of commodities. Consequently, its movement as circulating medium, is in actual fact only the movement of commodities under changed forms." (Capital, vol. 1.) Purchasing power resides in the goods which when produced belong to the capitalists. Gold, which was the actual material medium of circulation in earlier times, was with the rise of banking superceded in that function by the development of tokens and of paper representatives, which were convertible into money. Today banknotes and other paper are no longer convertible into gold. Nevertheless gold remains the money commodity since it still functions as the measure of value and as world money.

The commercial credit which the capitalists engaged in reproduction extend to one another by means of the promises to pay, constituted by bills of exchange and other certificates of indebtedness, is the basis from which the modern credit system developed. Banks are the intermediary agencies which facilitate the exchange of goods between the various owners, whereby one set of ccmmodities is sold for another. They act as middlemen between buyers and sellers who are each both borrowers and lenders in turn, since every seIler must also be a buyer before he can seIl. The seIler on depositing the purchaser's check is in reality ordering the bank to collect the debt; to transfer this amount from his debtor's account to his own. When his own debt to another seller is due his check issued to this creditor is in essence an order on the bank to transfer the stipulated amount from his own account to that of the creditor's. "These mutual claims of indebtedness represented by bills of exchange or checks are balanced either by the same banker, who merely transcribes the claim from the account of one to another, or by different bankers squaring accounts with each other." Checks, being orders to pay money are therefore certificates of indebtedness. Banks are institutions for the transference of debts and purchasing power which arise from the sale of goods and services. The issuance of a check is the conversion of commodities into a form of credit money and if cashed, into another form of money, banknotes. Thus we see, contrary to Social Credit dogma that banks cannot create credit from nothing since it is the creation and sale of goods that create credit. Purchasing power derives from the ownership of goods and the consequent command of services and must therefore always be equal to the totality of goods on the market.The bank too occupies the dual position of being both debtor and creditor since it lends out at a higher interest rate the great part of the deposits it has borrowed at a lower rate. This is generally the source of its profits.

The total product of society (minus that portion necessary for the replacement of used up means of production) can be said to resolve itself into income of wages, profits and rent (including money rent) although value is not determined. by these elements of income. The A plus B theorem of Major Douglas, founder of Social Credit, is supposed to demonstrate that A payments for wages and dividends, plus B payments for raw materials, bank charges etc., comprise the cost of production, while only A gives rise to income. Therefore, says Douglas, B payments must Iead to a shortage of purchasing power. But this is fantastic nonsense, aside from regarding dividends as a cost as it can readily be seen that the cost of raw materials has already been included when dividends have been disbursed. Also considering category B it will be realized when viewing the process of production in series that the raw materials of one industry is the product of the previous producers and this product produced the distribution of wages and profits. By adding the cost of production twice and thus doubIing it Social Crediters have certainly merited the description of their propaganda as double talk and this is the twaddle that is passed off as economics. The total income of society can never equal its total product since a part of this product, which represents no profit, must be used to replace the constant capital consumed (means of production). But this does not mean that the result is a lack of purchasing power.

see here
http://www.worldsocialism.org/spgb/archive/socialcredit%281933%29.pdf
http://www.worldsocialism.org/canada/ws34.socred.htm
http://www.worldsocialism.org/canada/ws35.socred.alberta.htm
And its resurgence http://www.worldsocialism.org/articles/major_douglas_rides_again.php