William Hinton – China’s great reversal

William Hinton was born in Chicago in 1919. He first visited China in 1937 and then in 1945 returned as a staff member with the US Office of War Information. During an eight year period, he also worked as an English teacher at a university in Shanxi and as a tractor-technician for the United Nations. He and his wife lived mostly in the village of Long Bow.

His best known book, Fanshen, documents in detail, from an on-the-ground perspective, the revolutionary process, especially land reform, in the area, based on his experiences of it. As a Marxist, he opposed the ‘capitalist roaders’ in China’s Communist Party and in 1990 wrote his critique, The Great Reversal, which is available below on-line in full. He died in the US in 2004.

From the Preface:

“June 4, 1989, stands as a stark watershed in China’s modern history. The slaughter of unarmed civilians by units of the Peoples Liberation Army as they blasted their way to Tiananmen Square illuminated the “reform” era as nothing else could. It lit up, like a bolt of cosmic lightning, the reactionary essence of China’s current leading group.

“This essence was known to many in China and to some abroad long before the lightning struck in June 1989, but most members of the Western media and academic world were too mesmerized by China’s reform rhetoric and market progress to apprehend the reality of the events unfolding before their eyes. Since privatization matched their prejudices and a consumption boom confirmed its validity, they preferred not to look too closely at the underlying currents of economic dislocation, infrastructural decay, environmental degradation, social disintegration, cultural malaise, and rising class antagonisms that threatened to unravel the fabric of Chinese society.

“Mao Zedong was far more astute. More than twenty years ago during the Cultural Revolution, he exposed Deng Xiaoping, Yang Shangkun, and most of their “hard line” colleagues as capitalist roaders. He accurately predicted that if such persons ever came to power they would transform the Communist Party into a revisionist party and finally into a fascist party and then the whole of China would change color.

“The surprising thing is not how accurate Mao’s prediction turned out to be, but rather how quickly it materialized in history.

William Hinton, 1990

The Contents are:

Preface

Introduction: China’s Rural Reforms

A Small Town in China: Long Bow 1978

A Trip to Fengyang Country, 1983

Reform in Stride, Rural Change 1984

The Situation in the Grasslands, 1985

Reform Unravels: Rural Change 1986

Bypassed by Reform: Agricultural Mechanization 1986

Dazhai Revisited: 1987

Mao’s Rural Policies Revisited

Why not the Capitalist Road?

Tiananmen Massacre 1989

The book is available here.

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Review of the major “radical” trends and their attitudes: Part 4 (final part) of ‘Outline on technology and progress’ – a Marxist view (Written by Albert Langer in October 1979)

“Quite politically conservative people like businessmen or revisionist party bureaucrats can contribute to social progress by developing the productive forces, but only revolutionaries can tackle the central issue of overturning the obsolete social relations”.

* * * *

17. Let us now review the major “radical” trends and their attitudes to these issues.

18. The ideology of the “soft technology” trend is well expressed in the journal Resurgence whose Editor Satish Kumar has summarised its aims thus: “The breaking down of our over-large and over-centralised political and economic structure into smaller autonomous units in order that institutions should become responsive to the needs and desires of everybody and that everyone should thus feel involvement with and responsibility for the conduct of affairs.” (“Time Running Out? Best of Resurgence”, Prism Press 1976)

The belief that smaller autonomous units guarantee responsiveness to the needs and desires of everybody is somewhat quaint in view of the history of feudalism. Nevertheless, in one form or another, this whole approach is still extremely popular in “left” circles. It seems that Marxism never did defeat anarchism after all.

Although many adherents of this trend are very nice, gentle people who would probably find themselves on the right side of the barricades if it came to that (even if only as stretcher bearers), the ideological content of this trend is undiluted reaction against modern society.

The best known exponent of this trend is E.F. (“Small is Beautiful”) Schumacher, whose social views are not radically different from B.A. Santamaria’s and are based on the same papal encyclicals (ibid p103). But Resurgence points out Schumacher should be paired with Professor Leopold Kohr in a “Kohrmacher”, like the “Chesterbelloc” of the last generation’ (an interesting comparison with another pair of religious medievalists)(ibid p1).

To show just how openly reactionary this trend can be, without the admiring disciples even noticing, we need not consider the promotion of Zionist kibbutzes as a model for the new society (p108). Let us just take an article by Professor Kohr on “The Economics of Progress” (p18).

Kohr starts with a conversation between two college professors discussing how to wash their shirts, and also “plumbing, floor polishing and cooking, glorying in the fact that progress had so simplified matters that all these things could now be done by themselves”.

But one of them sighs and declares:

…fifty years ago we would have had maids. Instead of having to wash, plumb, and cook like unspecialised pioneers, we might have been better engineers and economists. Moreover, our shirts would have looked pressed, and our meals have tasted better. And instead of discussing housework at a party of scholars, we might have discussed our subjects.

According to Kohr:

“The experience of the two professors is shared by an increasing number of people. On one hand, we witness the gigantic pace of progress and continuously rising output figures. But on the other hand, we have the strange feeling that, instead of getting ahead in life, we have to give up every year something we could afford when, according to living standard experts, we must have had less”.

To support this conclusion, Kohr notes that:

“When I was a student in the early 30’s, I drove a racy sports car”. (During the Great Depression). Now as a University Professor he rides a bus.

“And the income classes above me have fared still worse… Mr Dupont had to abandon his palatial residence.. Now it is a museum…Where are the people who have become richer as a result of Mr Dupont having become poorer? On the contrary, most seem to be carried along the same road: downhill… Those who previously drank wine with their meals now drank water, and those who had maids now have none.”

“As to maids, it is frequently said that their disappearance is precisely a sign not of decline but of rising standards. For maids of former days are now housewives or businesswomen. Quite. But why should maids have aspired to these higher levels except in the hope of having maids themselves?…

“And workers seem to have fared only outwardly better. True, they have record incomes and record quantities of goods to spend them on. But if all is taken into account, can they really be said to be better off than workers of earlier times? They can write and read. But what is their main literature? They can send their children to college. But what has college education become under the levelling impact of intellectual mass production made necessary by the unprecedented numbers of those now able to afford it?…With so many other workers going to school, higher education, already intellectually sterile, seems without added material benefit, having become the competitive minimum requirement for almost any job.”

(Exactly the same point is made by Braverman, but dressed up as “Marxism”)

“As a result, what has actually risen under the impact of the enormously increased production of our time is not so much the standard of living as the level of subsistence. We swim in more water, but we are still in it up to our necks, In addition, along with the rising water level, many who previously enjoyed the luxury of the dry shore, are now up to their necks in water too”.

(Braverman makes a similar point to this too).

“…the problem is…no longer how to foster growth, but how to stop it..”

The above is not a distortion of Professor Kohr’s views, but an accurate picture of the introduction to an article that goes on with the usual theme of the need for smaller, more decentralised communities.

It is perfectly clear what section of society this “aristocratic socialism” speaks for – that part of the financial aristocracy being ruined as the proletarianisation of society proceeds (just as the old feudal socialism spoke for the declining feudal aristocracy).

To his credit, Professor Kohr does not attempt to conceal this in the slightest. But why are his views, or those of “Kohrmacher” nevertheless perfectly respectable in “left” circles?

Since a critique of Braverman’s romanticism necessarily includes a critique of this even more reactionary opposition to modern society, I will leave the matter there.

19. A second major trend, which may be called “Luddite” has closer connections with genuinely working class and socialist movements, and is in part a theoretical reflection of the ideas naturally arising in the course of trade union struggles to safeguard the rights of workers affected by automation.

This trend is not opposed to modern technology in itself, and emphasises the benefits that could flow from it in a socialist society. But it has a negative attitude towards the introduction of new technology within capitalist society, seeing this as a means of doing workers out of jobs and strengthening capitalist control.

The question “For Whom?” is repeated continuously and with enormous self-satisfaction as though it throws some penetrating light on the issues at stake, although in fact it obscures the question “What are the social implications?”. Since the answer to “For Whom?” in capitalist society is naturally “For them” (the capitalists), it is rare to find people who ask this question actually in favour of any new technology being introduced now.

20. Typical of this genre is a pamphlet called “Computers vs Journalists who wins?” (40 cents from Box 175, P.O. 367 Collins St Melbourne 3000)

Under the subhead “Problems, Problems, Problems…” we read:

“Sub editors are particularly affected, as the new technology not only means removal of some existing skills, but makes it more difficult to perform many traditional ones. ‘Casting off’, or determining the length of a story, can be done automatically by computer, making redundant a skill acquired over a long period by subs…The skill in writing a headline, which “fits” will be greatly de-valued because the computer can reject those which “bounce” before they are set in type.

Some subs will welcome the job of casting off, or headline counts being made easier, but by transferring the skills involved from men and women to a computer the human component involved in the highly-skilled task of good sub-editing is weakened”.

The appeal here is unmistakably conservative. One can imagine similar warnings about moveable type being addressed to monks in defence of their highly skilled craft copying manuscripts (which was indeed completely destroyed by the new technology).

It has not even occurred to the writer that it might be an advance for a machine to do routine counting operations while the human sub-editor concentrates on the content of the material sub edited. Obviously one should fight for people whose skills have been made obsolete by new technology to be re-trained, re-employed and not to suffer in the slightest. But this preference for human labour when something can be done as well by machine is really quite different, and quite reactionary. It means using people like machines.

The conservatism involved is made quite explicit when the pamphlet quotes approvingly from an agreement between the Swedish Unions of Journalists and Graphic Workers, recommending similar agreements between Australian unions:

“GF and SJF agree that the introduction of the new technology shall not affect the traditional basic principles of a division of labour among the categories of employees concerned. Thus, mechanical production tasks fall to the lot of graphic workers, while journalistic tasks are the domain of the staff members. Special importance must be attached to the workload of the staff, which must not be increased in such a manner that creative journalistic work is made to suffer. Nor may the tasks of graphic workers be made to include functions embracing journalistic work of a creative or decision-making nature”.

This desire to preserve “the traditional principles of a division of labour” against a new technology that tends to break down those divisions can only be called reactionary. Why shouldn’t journalists set their own copy? Why shouldn’t printers’ jobs include work of a creative or decision making nature?

The other side of this coin is attempts to prove that a new technology is deepening the division of labour and therefore should be opposed, when in fact like most new technology the actual effect is to break down that division.

Word processing is a classic example. No serious person could argue that a typewriter with editing and correcting features is in itself worse for humanity than one without these features (although some people have tried). Yet from all the “left” literature on the subject, one would think that the main social impact of word processing under capitalism would be to reduce the status of typist/secretaries to the level of the typing pool, and reinforce the division between “executive” and “clerical” Labor.

Naturally some reactionaries will try to take advantage of any change in work methods to make things worse for the workers by introducing typing pools and what have you. Although it is easier to maintain word counts and so forth with a word processor, there is nothing inherent in the technology that would make it easier for bosses to impose typing pools and other worse conditions on the workers, and in fact they have not been successful in doing so.

While word processors are still new and expensive, there is some tendency to try and achieve maximum utilisation of the machine and so attempt tighter control over the Labor using it (especially since such intensification of labour is feasible in the present economic climate of increasing unemployment). But the inherent trend of the technology is in the opposite direction (as will become clear, when word processing keyboards and VDUs become cheaper than electric typewriters and replace them on a one for one basis – with a separate printer shared between several typists).

The actual impact of word processing has been and will be to reduce the total requirement for typing Labor, especially by eliminating the repetitive typing of similar documents with minor variations (“personalized” form letters with different addresses, revised drafts etc). These are precisely the applications where typing pools have been common, and they are being eliminated, so typing pools must be declining.

The jobs previously done by “secretaries” are now being done by smaller numbers of “administrative assistants” on the one hand, and word processors on the other. This elimination of the Executive’s personal secretary/body slave is a clear-cut upgrading in job status (except for the Executive’s some of whom are complaining) and a break down in the division of Labor. As has already happened with printers and journalists, the next logical step is for all “word originators”, whether “Executives” or not, to do their own typing, since no special manual dexterity is required with the new machines and the difference in wage levels does not “justify” specialisation. These trends will be accelerated, with similar impacts on the Labor presently required for fileing and other clerical work, as communication between word processors on different desks, and direct access to mass data storage is developed. Even for purely “typist” Labor in typing pools, the use of a machine with editing and correcting facilities is a clear upgrade in job function.

People who are afraid to confront bosses with the simple demand that there be no intensification of Labor under cover of the new technology will rationalise this fear by pretending that the new technology, rather than the bosses, are the source of the pressure for Labor intensification. But most workers know how to fight such pressures and have been successful in doing so (although the degree of Success or failure always ultimately depends on the state of the Labor market and the ease of transferring between jobs, hence on the overall economic climate, rather than on the militancy of struggle in individual workplaces).

This awareness that one’s fate is bound up with that of all other workers develops in the proletariat and helps develop its consciousness as a class for itself. It seems to be sadly lacking in many “left” writers about the “Labor process” who picture the class struggle as unfolding in particular workplaces rather than on a national scale, and seem to be under the illusion that workers are tied to their particular employers for life.

21. Leaving aside the overall struggle for a new society, even within capitalism, the natural reaction of socialist toward new Labor saving technology should be to demand its speedy introduction and a share of the benefits. Thus the earlier replacement of handicrafts by machine industry prompted agitation for a shorter working day in the factories, and so should the latest stage in automation promote agitation for a shorter working day.

Instead we have the modern Luddites repeating the mistake of the earlier Luddites who tried to prevent the new machinery replacing handicraft Labor in the.first place. An attempt as futile as it is reactionary.

22. This term “Luddite” is not used here simply as a form of abuse. It is admitted by representatives of this trend themselves, despite the whole history of scientific socialism since the Industrial Revolution. Here is Chris Harmon of the UK Socialist Workers Party in a pamphlet titled “Is a machine after your job? New Technology and the Struggle for Socialism”. (p21)

“… the Luddites were a group of workers suffering from miserably low wages and facing a destruction of their jobs by new working methods. Their attempts to fight back by destroying machines may not have been successful (although they did succeed in holding down a bigger army than the Duke of Wellington had in the same years to fight his war against the French in Spain).

“But the result of their failure was not something good. It was grinding desperate poverty for hundreds of thousands of people, enduring for a whole generation…

“…Our response has to start from the same suspicion of the way the new technology is being used that motivates those who simply say “No”. We are on the same side as the Luddites, not against them .”

The “microprocessor revolution” promises (not “threatens”) to have as big an impact on the labor process as the development of automatic machinery in the earlier industrial revolution. Just as the dexterity of human fingers was for most purposes replaced by machinery, so now some higher functions of control and supervision will also be replaced (although not yet much in the way of actually creative intellectual processes). It is truly amazing that instead of the further development of Marxism, which based itself on a theoretical comprehension of the social consequences of the age of machinery, we should see a revival of earlier and cruder varieties of socialism that have long been discredited in favour of Marxism, by the history of modern society.

Once again, since a critique of Braverman’s romanticism necessarily embraces a critique of modern Luddism, I will leave the matter there. But I should stress that this “theoretical” difference does put me on the opposite side to modern Luddites on strictly practical questions. When they are agitating against the introduction of word processors, I would be agitating for workers to demand their immediate introduction and refuse to operate obsolete typewriters that haven’t got all mod cons.

23. Before turning to Braverman and romanticism, it may be worth pointing out the important differences between the Liberal and Social Democratic defence of modern technology and economic growth on the one hand, and the Marxist view on the other, since so far we have been mainly talking about the similarities.

Both the similarities and differences are made clear in an article on “Technology and the Left” in the CPGB organ Marxism Today of May 1979. Here Ian Benson, a British Labor Party and trade union activist, makes much the same criticisms of “romanticism” and the CPGB’s line (similar to the CPA’s), as would be made by Liberals on the one hand and Marxists on the other.

24. After quoting Lenin’s analysis of the socialisation of Labor, Benson argues:

“From this perspective the simple classification of technology into exploitative and non-exploitative is seen to contribute little either to the raising of the cultural level of mankind or the solution of the political problems of establishing democratic control over the means of production.

The defence of particular skills amounts to an attempt to freeze the existing division of Labor, and defers the satisfaction of material and cultural needs by the rest of the population which would be met by automation. The principled opposition to centralisation on the grounds of the alleged greater democracy of decentralised production, is both contrary to the need for further integration of the world economy as a prerequisite for the breakdown of skill, class and national barriers, and offers nothing to solving the problem of establishing democratic control over the economy as a whole.

A socialist technology policy with these ends must be based on an analysis of the constraints on the development of science as a productive force, “preparing the ground for the dissolution of human alienation”.

This whole approach is so foreign to the romantic outlook that dominates most “left” thinking that people replying cannot even grasp what is being said. Consider this from a reply titled “What Type of Technology do we want” by Dave Elliott in the same issue of Marxism Today:

“…Benson believes that science and technology somehow develop independently from other forces in society. They are “neutral” resources of knowledge and techniques which can be applied either to the benefit of society generally (under socialism) or for the benefit of a few (under capitalism).”

Manifestly Benson does not believe that at all.

He quite clearly treats technology as a positive force which pushes society forward and helps transform it from capitalism to socialism. This is a view common to Social Democrats and Marxists. But it is so unthinkable to romantics that the worst accusation they can fling at the pro-technology camp is that we view technology as merely neutral, which we do not!

I have seen numerous articles loftily criticising the “old fashioned”, “economic determinist” and “simplistic” view that technology is neutral and that a socialist society could simply take over the previous technology and apply it to more humane ends. This “neutral” view is often attributed to Engels, Lenin and Stalin although Marx and Mao are often claimed to have been more sympathetic to the romantic school. But I have hardly seen any material directly confronting the “unthinkable” explicitly pro-technology view which was in fact articulated loud and clear by Marx as well as the rest.

What this “criticism” proves is simply that the critics are quite ignorant of the views of their opponents, let alone being in a position to advance on those views from a more comprehensive understanding.

It is rather like accusing atheists of the Protestant heresy because we will not pray to the virgin Mary, when in fact the problem is even more serious!

26. The differences between the Marxist and Social Democratic approaches to the social implications of modern technology are made clear when Ian Benson proceeds “Towards a Socialist Technology Policy”: “It should call for the removal of all barriers to the full development of science and technology in the interests of society, through a programme of radical institutional, scientific and political reforms.”

Benson then outlines a program of reforms to promote “re-skilling,”Democratic Control”, “Social Ownership”, “Development of Science” and “Socially Useful Production” – all with the aim of “liberation of science”.

What this omits is precisely the Marxist concept that the main “institutional” barrier to the full development of science and technology in the interest of society, is the capitalist mode of production based on commodities and wage labour itself. This has been obsolete since the age of electricity (never mind micro-electronics) and needs to be swept away by revolution (not reform).

Social Democrats share with Marxists the fundamental concept that the development of the productive forces, modern technology and economic growth, is the positive dynamic factor which pushes forward the transformation of social relationships. But they stand this conclusion on its head by calling for reforms to push forward new technology and economic growth (which are dynamic and pushing forward spontaneously anyway), instead of concentrating on the obsolete social relations which are the passive factor that has been left behind and is acting as a brake on further progress. In fact in an era such as this, where the social relations are obsolete, it is precisely by social revolution that the productive forces can be unleashed for further and more rapid development (and in the act of social revolution, the relations of production temporarily assume the role of the most active dynamic factor).

Although the terms “productive forces” and “relations of production” have been turned into an almost meaningless cliche, once grasped, the concept is almost tautologous in its simplicity.

27. Economic growth, and especially technical progress, is essentially cumulative. New developments, even if quite useless, or only capable of being used in a harmful way, always add to the range of possibilities open and never shut off possibilities that were open before. We still spend most of our waking hours “Making a living” and our social relationships are formed in the course of doing so. It is hardly surprising that the continous opening up of new ways of making a living should continuously leave behind and render obsolete the old social relationships founded on the basis of obsolete ways of making a living.

28. The whole point about the productive forces being the active dynamic factor, is that they have an in-built tendency to develop spontaneously, which the relations between people do not.

Whenever an enterprise improves its production technique, or an individual worker improves his or her lot (eg. by obtaining a more responsible position), there is a development of the productive forces. But it is not automatically accompanied by any corresponding change in social relations. Under capitalism such developments are proceeding spontaneously all the time, indeed they are a necessary condition for the expansion of markets and the possibility of re-investing surplus value in the expanded reproduction.

29. The social relations of production can get left behind as the productive forces develop, so that today for example, we still have essentially capitalist relations between people, based on commodity exchange and wage labour, which were appropriate to the petty production of the middle ages but are no longer compatible with large scale machine industry (let alone being compatible with the latest developments).

30. Just as the institutions of slavery and serfdom once held back the further development of the productive forces and had to give way against the slave and surf revolts, so the institution of wage labour is now holding things back and giving rise to revolts. Eg. apart from the obvious contradictions between capitalism and economic growth expressed in business crises, there is the day to day stifling of the enormous creative energies of the workers themselves, which could be unleashed in a system where they had an interest as masters of production, instead of a direct interest in sabotaging it and “conserving” their jobs. Then scientific and technical innovation would not only be unhindered by mass unemployment and crises, but would be the conscious activity of the majority instead of the province of “management control”.

31. It follows from this analysis that the critical task facing society is to smash the obsolete social relations as the only way to liberate the productive forces or “liberate science” as Benson puts it.

32. Quite politically conservative people like businessmen or revisionist party bureaucrats can contribute to social progress by developing the productive forces, but only revolutionaries can tackle the central issue of overturning the obsolete social relations.

33. Therefore in every society in transition from capitalism to communism, whether a capitalist society like Australia or post-Mao China, with the bourgeoisie in power, or a socialist society like Mao’s China, the central political issues are often expressed in terms of whether to focus on developing the productive forces or on transforming the relations of production

34. The representatives of the old capitalist relations, the bourgeoisie, the conservatives, whether they be “businessmen” or “party officials” share much the same rhetoric in calling for “hard work” to “make more cake” and in dismissing the workers struggle to transform social relations as an interference in that process. It is interesting to note how Ian Benson appeals to both the Czechoslovak Communist Party Program of Dubcek’s time, and the “four modernisations” stuff coming out of China today, in support of his views. The only difference between Social Democrats and Liberals in this regard is that Social Democrats place greater stress on making necessary concessions to the workers: “share the cake more equally and don’t waste it”.

35. In opposition to the Malcolm Fraser’s and Hua Kuo-feng’s, the representatives of the new communist relations of production the proletariat, the radicals, raise the question of “all power to the cooks”. This (after a certain amount of cake-mix spoiling due to confusion among the cooks), is the only way to really transform cake production.

36. Unfortunately the Marxist analysis of forces and relations of production can only be grasped by the majority in communist society where the majority of humanity are consciously engaged in changing themselves. If it was the dominant view, even among the “left”, and did not have to continuously fend off assaults from reaction, Luddism, romanticism and Social Democracy, then we would have already have had the revolution.

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Technocratic priesthood, Centralisation, Unemployment : Part 3 of ‘Outline on technology and progress’ – a Marxist view (Written by Albert Langer in October 1979)

“… in its most absurd form, we even get complaints about the large scale and “centralisation” of the means of production themselves, and not of their ownership. Thus in arguments about nuclear power, we are told to beware of oppression by the controllers of big, centralised power stations. Apparently the theory is that if all power comes from a central source we have less control over our destiny than if we have smaller, local power stations. Taken to an extreme, some people are mad keen on windmills, solar panels, methane generators etc and hope to combine these with vegetable plots, mud brick construction and what have you to create a life style in which one can escape the clutches of capitalism as completely as possible by avoiding all buying and selling and isolating oneself from the market economy. While I have no objection to other people tinkering with such things if they really want to, personally I prefer being able to obtain electric power at the flick of a switch and without tinkering with anything. This does not “alienate” me in the slightest and I am quite sure most people feel exactly the same way”.

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14. f) Technocratic Priesthood

The very term “priesthood” evokes images of barbaric societies in which the mass of the population were ignorant of natural phenomena and paid homage to a minority elite who were sufficiently literate to be able to pass on knowledge about the seasons, tides and other matters essential to production as well as culture.

To believe that such a priesthood rules society today, requires considerable imagination. It is perfectly obvious that power in our society is held by capitalists and stems from their wealth and not from any monopoly of technical knowledge. In the more backward capitalist countries like the Soviet Union and China, one might confuse the ruling Party bourgeoisie with a priesthood because of superficial resemblances in forms of organisation and alleged service to a “Marxist-Leninist” religion. This may have something to do with the survival of more backward semi-feudal relationships. But there is clearly nothing “technocratic” about it and the interrelationship between wealth and power and the role of managers and bureaucrats is quite similar to more advanced Western capitalist countries.

Scientists and engineers are employed by the ruling class and work for wages like the rest of us. They too have no monopoly on technical information, which is widely diffused among the literate population and can be readily acquired in libraries and even newsagents. The mythology about a “technocratic priesthood” is most widespread among liberal arts graduates who have gone through school and university doing only “humanities” courses and have thus been denied the basic technical education which is acquired by most school and University students in our society.

There is no excuse for this one-sidedness however, since any literate person can pick up the fundamentals of modern technology by just browsing through the “How and Why” type of children’s’ encyclopaedias readily available in every newsagent.

Nuclear power is held up most often as an industry where the dangers of a “technocratic priesthood” are greatest. In fact it is the most publicly regulated industry with the least initiative in the hands of technocrats. The whole technology down to blueprints and detailed engineering reports is completely in the public domain and there is no mystery about it whatever.

The average worker today has far more grasp of basic industrial technology, and is given a far more “theoretical” education than in earlier times. If some liberal arts graduates feel left behind and overawed by modern technology, they would do better to learn something about it than to continue writing speculative nonsense about a “technocratic priesthood”.

15. g) Centralisation

Socialists have always welcomed the centralisation of capital as a progressive development paving the way for Communism. In everyday practical terms, most people understand that the big multi-nationals have more “enlightened” management, produce better products and pay better wages than the smaller “sweatshops”, that supermarkets are a better place to do one’s shopping, that family farms are on the way out and so forth.

But many “radicals” actually stake their hopes on retarding monopolisation, propping up the small businessmen, shopkeepers and farmers against the multi-nationals and so on.

Fundamentally the complaints about “centralisation” reflect an awareness that wealth and power in our society is concentrated in the hands of a very tiny elite, but with a conservative reaction to try to turn the clock back, instead of pushing forward to socialism and communism.

But in its most absurd form, we even get complaints about the large scale and “centralisation” of the means of production themselves, and not of their ownership. Thus in arguments about nuclear power, we are told to beware of oppression by the controllers of big, centralised power stations. Apparently the theory is that if all power comes from a central source we have less control over our destiny than if we have smaller, local power stations. Taken to an extreme, some people are mad keen on windmills, solar panels, methane generators etc and hope to combine these with vegetable plots, mud brick construction and what have you to create a life style in which one can escape the clutches of capitalism as completely as possible by avoiding all buying and selling and isolating oneself from the market economy.

While I have no objection to other people tinkering with such things if they really want to, personally I prefer being able to obtain electric power at the flick of a switch and without tinkering with anything. This does not “alienate” me in the slightest and I am quite sure most people feel exactly the same way. We have simply never felt oppressed by power stations (except by the bills which are of course much lower than they would be with less centralisation).

It is difficult to even imagine how centralisation of power stations could be used as an instrument of oppression. Is it suggested that in a crisis the embattled bourgeoisie might take refuge in the power station and threaten to turn it off if we didn’t return to wage slavery? On the contrary, they seem concerned to ensure that “essential services” are not disrupted during major strikes. In any case the electricity grid that links power stations in every industrialised country is about as “decentralised” as one could ask.

It is hard to imagine a more direct reversal of traditional socialist attitudes towards the implications of large scale industry. The point is not to refute this wooly thinking about “centralisation” but to ask what process of mental atrophy could produce such patent nonsense, repeated so often with such authority?

The only answer I can see is that the extinction of Marxism by revisionism during the period of capitalist re-stabilisation has been so complete that most “radicals” have never even heard of Marxist views and have had to re-discover for themselves all the pre-Marxian socialist theories. (This certainly seems to have been the case with the “New Left” that grew up in the middle sixties, even when Marxist phrases were used.)

16. h) Unemployment

It is a well known proposition of Marxism that as capitalism develops with an increasing organic composition of capital, the size of the industrial reserve army increases and this is particularly manifested in mass unemployment during crises.

The obvious conclusion is that capitalism should be abolished so that people are not “employed by” capital but instead “employ” means of production to satisfy their own requirements.

Instead we have extraordinary proposals from “radicals” to freeze technological development, or at least control and retard it, so as to “safeguard jobs”. The whole trend of most “left” analysis of technology and unemployment involves an acceptance of capitalist irrationality as permanent, and a willingness to restrict the growth in productive forces and therefore living standards so as to adapt them to this irrational economic system (without mass unemployment).

Surely the most elementary socialist consciousness would involve welcoming Labor saving technology and demanding its speediest and widest adoption. If the social and economic system can’t cope then that’s its problem! It is very strange to see “socialists” arguing that since capitalism can’t cope with new technology without unemployment, we should keep the capitalism, but do without the technology. Yet that is exactly what is implied when people complain about Labor saving technology. They are even prepared to put up with having to work longer hours to produce fewer goods, just as long as they can keep their precious capitalism!

Ricardian economics long ago accepted that the introduction of new technology can be against the real immediate interests of workers who lose their jobs because of it. But its a long way from there to adopting a program that tries to inhibit new technology. In fact it has always been when technological change is most rapid that the scope for expanded capital accumulation is greatest and new jobs are created soaking up the reserve army and raising wages. Stagnation simply means a larger and larger reserve army.

Actually most remarks about technology are prefaced by a reference to “the current economic climate”. This reflects awareness that technological change and the accompanying destruction and creation of jobs is a permanent factor of capitalism, both when there is “full employment” and when there is mass unemployment.

Obviously the fact that mass unemployment suddenly started to develop throughout the Western world a few years ago cannot be attributed to any equally sudden change in technology and must be attributed to the particular stage in the capitalist business cycle that was reached then. So why do people persist in blaming a process of technological change that has been going on all the time?

It can only be because they don’t want to face up to the implications of capitalism as the source of our problems. Its easier to fight “the machines” than “the bosses”, or at any rate it’s more respectable to do so.

Final installment next time… Reviewing the major “radical” trends and their attitudes…

‘Outline on technology and progress’ – a Marxist view* (Written by Albert Langer in October 1979) Part One: Introduction – Marxism, eco-catastrophe and environmental degradation

The major trends among Western “radicals” on issues concerning technology and progress can be summarised as follows:

a) Outright opposition to modern technology and nostalgia for the past, summed up in the slogan “Small is Beautiful”.

b) Acceptance of modern technology if society was socialist, but Luddite hostility towards it in capitalist society, summed up in the slogan “For Whom”.

c) Acceptance of modern technology in present day capitalist society but a rejection of the social relations that have developed together with it and a romantic “nostalgia for an age that has not yet come into being”, where the dignity of craft skills will prevail.

* * * *

The following outline for an article is unfinished, incomplete, out of sequence and lopsided in emphasis. A major section or companion article on Braverman’s “Labor and Monopoly Capital” has not been prepared yet.

1. Objections to the trend of modern technology and economic growth may be summarised under the following headings:

a) Eco-catastrophe

b) Environmental degradation

c) Limits on Growth

d) Third World Dependency

e) Wasteful Consumption

f) Technocratic Priesthood

g) Centralisation

h) Unemployment

i) Commercialisation and rat race

j) Degradation and Deskilling of Labor

2. These themes are all part of the very fabric of “left wing” and “radical” thinking in Western countries. Reference to them, often in a glib and trendy way, has become a trade mark to distinguish “them” (“the establishment”) from “us” (“the radicals”). Rejection of these themes is generally considered heretical and a sign of impending desertion to the other side.

3. Nevertheless, Third World revolutionaries actually engaged in armed struggle against imperialism, the classic founders of scientific socialism and the leadership of socialist countries have never stressed these themes in the same way. This paper will challenge the widespread assumption that emphasis on these themes reflects a more “advanced” conception than other “simplistic” views, and will show that a polemic against opinions that are now most fashionable among the “left” was a central feature of the development of scientific socialism (by which I mean “orthodox” Marxism, or Marxism-Leninism).

4. This paper has nothing new or startling to say but will simply try to raise the banner of a position of whose existence most “radicals” seem quite unaware, without undertaking a comprehensive defence of that position. Since in surveying the literature I couldn’t find a single article advocating the position I hold, and which I understand to have always been the “orthodox” Marxist view on these questions, I felt obliged to write one myself. Any assistance from readers who can point me to relevant material would be most appreciated.

5. The major trends among Western “radicals” on issues concerning technology and progress can be summarised as follows:

a) Outright opposition to modern technology and nostalgia for the past, summed up in the slogan “Small is Beautiful”.

b) Acceptance of modern technology if society was socialist, but Luddite hostility towards it in capitalist society, summed up in the slogan “For Whom”.

c) Acceptance of modern technology in present day capitalist society but a rejection of the social relations that have developed together with it and a romantic “nostalgia for an age that has not yet come into being”, where the dignity of craft skills will prevail.

The dominant view is of course an eclectic mixture of all three, sometimes even combined with views taken from the pro-technology, pro-growth camp.

6. In the camp which rejects the main objections to economic growth and modern technology listed above, and which criticises the reactionary, Luddite and romantic assaults on modern society, the dominant trend is straight forward bourgeois complacency or Liberalism, which explains the unpopularity of pro-technology, pro-growth views among the “left”.

Closely allied to Liberalism, and subordinate to it, is a Social Democratic trend which dresses up much the same analysis of society with a few Marxist phrases about promoting the revolutionisation of society by developing the productive forces. This has more support than Liberalism within the “left” because it is more critical of modern society and therefore closer to the anti-technology, anti-growth camp on issues unrelated to technology and economic growth.

The dominant ideology in such allegedly “socialist” countries as the Soviet Union, post-Mao China, and Albania, reflects a mixture of Liberal and Social Democratic attitudes and therefore adds to the unpopularity of pro-technology, pro-growth views within the “left”.

7. But also in the pro-technology, pro-growth camp, is a quite different position, which I would call the “orthodox” Marxist, Marxist-Leninist, or scientific socialist view. This fundamentally agrees with the Liberal and Social Democratic trends in opposing reaction, Luddism and romanticism (as Lenin agreed with Struve and the “legal Marxists” in fighting Narodnism in Russia). But it fundamentally breaks with these trends in its analysis of the revolutionary implications of modern technology and economic growth. While joining with the anti-technology, anti-growth camp in rejecting modern society, this rejection is positive in contrasting the present with the future and not negative in trying to retard the further development of modern capitalist society.

The views of this trend will be found in various works by Marx, Engels, Lenin, Stalin and Mao Zedong, many of which are explicit polemics against romanticism etc.

8. Let’s review the various anti-technology, anti-growth themes one by one. The first eight, which tend to attack modern technology and economic growth as things in themselves, will be dealt with rather quickly. The last two, concerning Commercialisation and the Rat Race, and the Degradation and Deskilling of Labor raise more serious issues about capitalist social relations, and will be dealt with more fully when analysing romanticism and commenting on Harry Braverman’s “Labor and Monopoly Capital”.

9. a) Eco-catastrophe

Various scenarios for the catastrophic destruction of humanity if present trends continue have been put forward by the more extremist opponents of modern technology and economic growth. These range from the “population explosion” to the long term effects of heat pollution, carbon dioxide or the break up of the ozone layer. Although in one sense a “lunatic fringe”, these ideas do have some real influence within the “left” and people often fall back on them (without necessarily knowing any of the details) when otherwise stuck for arguments.

Detailed refutation of the various theories is not appropriate here. But it’s worth noting that some people actually want their disaster theories to be true because they want there to be some barrier to the further development of industrialisation. Feelings of “doom” are widespread because the present social system is in fact doomed, but instead of correctly identifying exactly what is doomed, people tend to transfer their feeling to anything convenient. Catastrophe theories are not being put forward by scientists who believe in technical progress and economic growth and are worried because they have come across some phenomena that might threaten this. These theories are put forward by people (whether scientists or not), who already want there to be a barrier and go out looking for it.

They do not understand Marx’s proposition that “the only barrier to capital is capital itself” and they look for some external obstacle to the further development of capitalism, lying outside capitalist society itself.

There is even a kind of “eco-fascism” with ideas and solutions remarkably similar to those of fascists in the 1930s, particularly in regard to population control.

10. b) Environmental degradation.

This theme is also taken up by people who want there to be some external barrier to the further development of capitalism. It is really only relevant to the technology and growth debate insofar as some catastrophe is predicted. Insofar as one is talking about incidental environmental degradation, the classic answer given by Liberals cannot be refuted:

“It is easier to modernise plant and equipment (e.g. to incorporate pollution control mechanisms) and to engineer structural readjustments to the changing pattern of economic activity in a growth context than otherwise. More fundamentally, economic growth implies that the stock of resources (including technology) which the community has at its disposal is continually expanding… Nowadays we have the opportunity that comes with growth to opt for a more pleasing environment. If that opportunity occurs in an expanding economy, opting for it need not involve an absolute reduction in presently enjoyed standards in other respects. In short, ‘growth’ entails a positive contribution to pollution control in a way which a ‘stationary state’ cannot…

…If pollution control standards are set to high that the costs of control clearly exceed the resulting benefits, resources will be wastefully diverted from other purposes – including perhaps other forms of environmental improvement. Moreover, it is already apparent – with the technology of pollution control only beginning to develop – that even modest expenditure can have large effects in reducing pollution.

In summary the damage from environmental pollution in a large and growing economy with effective pollution control standards certainly need be no greater and in practice is likely to be far less than the damage in a small and slower growing economy operating in the same area without effective pollution control measures. The quality of the environment can be improved much more – and more quickly – by measures to counter pollution than by steps to contain economic growth. It is doubtful in any case whether action of the latter kind will be deliberately attempted, and if it were, and the improvement in living standards were slowed down as a result, the resistance to applying resources to control pollution would be so much the greater.” (Treasury Economic Paper No 2 “Economic Growth: Is it worth having?” June 1973, AGPS Canberra, p19 and p21)

Even leaving aside the difference between capitalist and socialist attitudes to the environment, it is clear that industrialisation has markedly improved the environment compared with pre-industrial societies. Not only was the life of the “noble savage” something “nasty, brutish and short” but even in feudal times the environment can be summarised in this jingle:

In days of old, when knights were bold,

and lavatories weren’t invented;

People laid their loads, beside the roads,

and went away contented.

Even the aristocrats, let alone the “solid yeomen” of pre-industrial society literally stank – and not only in the towns where the streets were used as sewers. Forests were denuded and dustbowls and deserts created, before modern agriculture began to reverse this process.

Over the last decade in particular (as a result of pressure from people concerned about the environment) we have seen a clear and definite improvement in environmental protection. The increasing concern with pollution controls today precisely reflects the fact that as industrialisation proceeds, higher standards not only become necessary but also possible and are demanded.

(* ‘A Marxist view’ does not appear in the title of the original 1979 article but I think it is important to state from the outset that that is what it represents – C21styork )

To be continued… next instalment, Part 2 – Limits to growth, Third World Dependency and Consumerism…

Solutions: Part 6 of ‘Unemployment and Revolution’ by Albert Langer, 1981

Part 6: Solutions

Considers various “solutions” from the labour movements, in the light of the earlier analysis, and rejects them all, but cheerfully, in view of the next instalment, part 7.

– “Giving Fraser the Razor”

– Blowing Up the Balloon

– Fine Tuning

– Political Facts

– Shorter Hours and Higher Pay

– Expanding the Public Sector

– Workers’ Co-operatives

– Labor to Power with Socialist Policies?

– Economic Consequences of Statism

– Protectionism

– “Militant Struggle”

– Revolutionary Optimism

6. SOLUTIONS

The collection of previous instalments on the nature of unemployment is important because it suggests what could and what could not be solutions to the problem.

It follows from the above analysis that the unemployed form an essential “reserve army of labour” as necessary to ensure a continuous supply as the existence of stockpiles of commodities in the warehouses or unused production capacity in the plants. The size of this reserve army does not depend primarily on government policy, but on the objective state of the economy and the phase of the business cycle that it is in.

Australia is part of an interlocked world capitalist market where capital flows freely according to the rate of profit, and where movements in interest rates, prices, wages, and unemployment therefore take place in parallel among all the advanced western capitalist countries together. It would obviously be nonsense to blame the overall state of the Australian economy on the particular policies of any government here, since the same situation exists throughout the western world.

The conservatives are right to say Australia has to adapt to changes in the world economy or the situation will get worse. They are also partly right to say that to stimulate investment and reduce unemployment profits must be improved at the expense of real wages and living standards. But they are wrong to pretend that there will be much improvement without a major economic crisis.

Unemployment has grown because overproduction and insufficient expansion of markets has reduced profit margins and therefore reduced investment. Any “solution”must therefore involve expanding markets to increase profitability. That is the crucial fact which emerges from studying the causes of unemployment.

A lot of people in the labour movement do not like admitting this and instead come up with all kinds of fancy arguments suggesting that capitalism is really a wonderful system capable of continuously improving living standards and providing jobs for all – if only the government would follow correct economic policies.

Those arguments are very mysterious and technical, involving “multipliers”, “accelerators” and various tricks with mirrors. But you only have to look around at the real world to see they are bullshit. For what possible reason would the capitalists be ignoring this wonderful advice on how to keep their system going, if it could really work?

The conservatives are openly admitting that capitalism is a rotten system which needs to grind people down in order to keep going. They are admitting that full employment and rising living standards are not permanently compatible with the capitalist system, which has its own requirements contradictory to social needs. They are actually admitting that production for profit is the cause of our problems.

On that point every socialist, revolutionary or not, must surely agree with the conservatives. Only the wettest “liberals” could join the Labor Party in insisting that there is really nothing wrong with the capitalist system itself – the problem is that wrong economic policies are being followed.

Socialists will not disagree with conservatives about the existence of statistical facts, like the decreased share of profits in the GNP, “real wage overhang” and so on. We will not join the Labor Party in arguing that it can all be fixed by magic tricks with mirrors.

Where we do disagree with conservatives is about whether capitalism is such a wonderful system that we should put up with unemployment and reduced living standards just in order to keep it going a bit longer.

Where revolutionary communists will disagree with other “socialists” is whether capitalism is just getting worse in a gradual way that would make it possible to introduce socialism peacefully, or whether it is heading for major upheavals which make a violent break between the old system and the new, both necessary and possible.

Now let us consider some of the various “solutions” that have been proposed for unemployment according to the simple criteria – “will this proposal increase profitability”. If it will not, then we know from the analysis above, that it will not work.

Giving Fraser the Razor

Attempting to blame each other for the state of the economy happens to be one of the daily preoccupations of Government and Opposition politicians, and unfortunately the left generally goes along with this charade.

Conventional wisdom has it that government job creation schemes, more stimulation of the economy through deficit spending, and various specific adjustments in economic policy could improve the situation. Only Fraser’s “razor gang” mentality prevents these solutions being adopted.

In Britain the state of the economy is being blamed on the Thatcher Government, by business as well as labour. But tightfisted “monetarist” governments have come to power in Australia, Britain and the USA as a result of the previous failure of their opponents to improve the state of the economy. They may conceivably make things worse. But their predecessors have not done too brilliantly either. It will be interesting to see what happens in France. Does anybody on the left seriously imagine that France will now escape the economic difficulties embracing the rest of the capitalist world, because it has a more ‘progressive’ government?

At the first Australian Political Economy Movement conference in Sydney, there were a number of papers purporting to explain unemployment and economic crisis as an inherent feature of capitalism. None of them even suggested that the personal malevolence of Malcolm Fraser was a cause of the problem – let alone the cause.

Nevertheless, the conference plenary session adopted a resolution loudly denouncing the Fraser Government for causing our economic difficulties with its wrong policies!

If that is the response of people at a political economy conference, it is not surprising that the left generally completely capitulates to Labor Party views about the economy. The general feeling is that somehow or other, it must be Malcolm Fraser’s fault, even though unemployment actually grew much more rapidly under Whitlam than it has under Fraser.

Even people who know better tend to go along with this because there does not seem to be much else to do. Demonstrations and agitation have to have a target, and Malcolm Fraser, with his callous attitudes, makes a good one.

If we cannot blame government policy, what can we do? It is in the Labor Party’s interest to pretend that Fraser’s policies are the cause of unemployment. But the only way Labor could do better than Fraser at reducing unemployment would be if they know how to make industry more profitable. There is no evidence that they do, and no reason to doubt that Fraser is doing as much to increase profitability as he possibly can.

Certainly we should give Fraser the razor, along with Bill Hayden, Bob Hawke and the rest. It will improve public morale no end. But it will not bring down unemployment. Only improved profitability and expanded markets can do that.

Blowing Up the Balloon

The main thrust of objections to the Fraser Government’s economic policies seems to be that they could do more to stimulate the economy by increases in government spending. They are accused of wilfully refusing to do so because of dogmatic adherence to “monetarist” theories, and general hostility towards the working class.

Actually this argument amounts to dogmatic adherence to Keynesian theories that have long been discredited by the course of events. All the governments of the western world have been stimulating their economies by increases in government spending, and it simply is not working any more. Keynesian economic policies now amount to little more than attempting to prolong the “boom” phase of the capitalist business cycle by deliberately encouraging the overextension of credit to finance overproduction and overinvestment.

Credit expansion has deferred the crisis, and intensified the most prolonged boom in history. But only at the expense of deepening the structural imbalances that the crisis is needed to resolve, and therefore making the crisis far more intractable when it does come. There comes a point when it just does not work any more. If it still worked, they would still be doing it.

When asked what would happen in the long run, Keynes replied that in the long run, we are all dead. Glib claims that more deficit financing to stimulate the economy are the answer, are simply an assertion of faith, flying in the face of all recent experience. The conservative Ford Administration in the USA ran a breathtaking $60 billion deficit, and it has not done any more than postpone the problems.

Attempting to stimulate the economy by more government spending has been compared to trying to stop a balloon collapsing by blowing into it harder. At a certain point when a balloon is being inflated, the fabric tears and air starts rushing out the hole. You can keep the balloon’s shape for a little while by blowing harder, but the air keeps rushing out and the hole gets larger. Eventually the balloon has to collapse and the only thing to do is to let it go and patch the hole before re-inflating it again – if the hole has not got too big to patch while you were uselessly blowing air through it.

If government spending is paid for by taxation, then it is just a transfer of resources from one sector of the economy to another, with no necessary increase in employment, although the projects may be well worthwhile for other reasons. If the money is borrowed on the open market, then it drives up interest rates and diverts funds from other investments. If it is effectively “borrowed” from the Reserve Bank, then credit inflation can be the only result. The trick can not be done by mirrors.

“New Deal” policies did help speed up recovery from the last depression. But mainly by helping to keep prices up in those industries where they had collapsed more than necessary due to insufficient monopoly concentration. The “New Deal” stopped dumping, put a final end to “laissez-faire” and thoroughly established the system of state monopoly capitalism. But today nearly all industry is pretty well monopolised. Even the farmers have strong cartels, and with rampant inflation, dumping can hardly be an immediate problem.

Really it has been a remarkable performance since the last depression. Despite predictions of capitalist stagnation since the end of the fifteenth century, and with a social system straight out of the sixteenth century, the bourgeoisie has managed to sustain economic growth for another fifty years at a pretty fair pace.

While pathetic by future standards, the rate of economic growth has been sufficient for conservatives and reactionaries (including most of the “left”) to actually complain and want to slow it down. What more can state capitalist policies be expected to achieve? Permanent survival of capitalism?

Fine Tuning

When people say that government policy is responsible for unemployment being more than it should be, they usually argue that there should be a certain increase or decrease in interest rates, the exchange rate, taxes, deficits or what have you.

Perhaps there should be. Who knows and who cares? The argument always revolve around the fact that any effect in one direction is counteracted by other effects in the opposite direction.

Quite clearly there is some underlying movement in the economy itself that makes the adjustments in government policy necessary. People argue about whether interest rates should be marginally increased or decreased, but they have gone up from 2.1% on two year government securities in 1950 to 10.8% in 1974 on their own volition and for objective reasons. Nobody seriously suggests that any government policy could successfully halve today’s interest rates, let alone restore them to their 1950 levels.

Adroit handling or misguided policies could make a good situation better, or a bad situation worse, or vice versa. But in a market economy it is the market, not government policy, that determines the overall situation. And we are talking about a world market, completely outside the control of any group of governments, let alone the Australian Government.

A government that raises interest rates when it should be lowering them, or vice versa, can certainly make things worse. The same goes for other economic variables that government policy can influence.

But the best a government can do is get its economic policy absolutely right, all the time. In that case they will avoid precipitating any crisis before it is unavoidable, which is not quite the same thing as having “control”. No amount of “fine tuning” can determine the overall direction that the world economy is moving. Nor can it change the fact that interest rates and other variables must be adjusted in accordance with that movement and not against it.

“Fine tuning” has been likened to trying to straighten a piece of string by pushing it. The sort of “controls” available to governments are just not capable of determining economic developments. If you want to straighten a string you need to be able to pull both ends, not just push. If you want to control unemployment, you have to have complete central planning of investment and employment and indeed, production and consumption generally. The economy needs a new engine and new steering, not just “fine tuning”.

There is a branch of mathematics called “control theory” which investigates what observations one needs to be able to make, and what variables one needs to have control of, to determine the future path of a complex dynamic system.

Economists have a “simpler” procedure which consists of counting the number of “variables” and “policy instruments” and hoping they are equal. To predict the future course of the economy they do a lot of plotting straight lines through two points.

The fact is that even very simple dynamic systems are extremely difficult to observe and predict, let alone “control”. It is sheer stupidity to imagine that anything so complex as a modern market economy can be effectively controlled by anything so simple as government monetary and financial policies superimposed on market price movements.

A system like this is bound to have oscillatory movements and catastrophes. It is like trying to damp out ripples in a pond by making counter ripples. You will get pretty interference patterns, but nothing very stable.

Before you can control any dynamic system you have to at least be able to predict what the effect of any changes you make will be. If anyone knew how to predict that, for the world market, they would not be wasting their time giving economic advice to governments. Literally billions of dollars could be made by speculation on the commodity and financial futures markets if anyone knew how to predict what the world market would do next, let alone control it. The funds you could accumulate from speculation would give you far more control over subsequent market movements than any amount of government policy.

There seems to be no obvious reason why anybody on the left should want to enter into the argument about whose policies for fine tuning the economy would work better. But if we are to do so, there seems no compelling reason to enter on the Labor Party side of that debate.

There is good evidence that the conservative parties are better at that kind of thing than the Labor Party is, because they have more idea of what it is all about. At least they understand that the name of the game is “profits” and are therefore trying to make the capitalist economy work the only way it can. Labor Governments do end up adapting themselves to economic reality, and working as hard as they can to boost business profits. But it does not seem to come naturally, and we have to put up with an awful lot of hypocritical mumbo-jumbo about the workers’ interests, before they get on with it.

Labor Party supporters make persistent efforts to prove that the other party’s economic policies are stupidly wrong. This proves only one thing. It proves that these people, even if allegedly “Marxist”, have a very deep faith that capitalism can be made to work much better, and that their party is the one to do it.

Political Facts

Most voters understand how capitalism works, better than the Labor Party does, and they are aware that conservative parties know more about economic management than reformist parties do. That is one major reason so many workers vote for the party that frankly upholds the interests of their bosses. If people did not accept the basic idea of having bosses, they would be working for a revolution, not voting Labor.

Labor supporters seem to have a mental block about it, but Fraser is Prime Minister because he won by a landslide, not because John Kerr put him there.

People voted for Fraser because the economy deteriorated much more sharply under Whitlam than it did under McMahon. One statistic tells the story.

Unemployment rose by more than 100 for every day Fraser was in office, according to Bill Hayden speaking at the last Federal elections. It did, but unemployment rose by 150 for every day Labor was in office.

Another fact confirms that part of the reason for this sharp deterioration was Labor’s policies and not just objective conditions. The fact that Labor has abandoned nearly all the economic policies advocated by Whitlam and adopted those advocated by Fraser.

Bill Hayden fought the last election on policies to cut taxes and put money back in people’s pockets, reduce government spending, impose wage restraint and so on – exactly the policies that Fraser won with. It is hardly surprising that most voters preferred to let Fraser implement those policies himself, even though he obviously has not been doing much good with them either.

In government, Labor even had a policy of discouraging foreign investment – in a completely open economy largely dominated by foreign capital. When that policy actually started to work, and foreign capital dried up, Labor supporters complained about a conspiratorial “strike by capital” that was aimed at bringing down their Government. How contradictory and inane can one get?

That is a good illustration of how bad government handling can make a bad situation worse. But Labor supporters are well aware than even if the Whitlam Government had handled economic policy perfectly, instead of stuffing it up, unemployment would still have grown dramatically because of the general state of the world economy. Why should we not admit the same about Fraser?

Public opinion turned against the Labor Party because of the mess it was making, and also the mess it was not making but was blamed for anyway. The media mobilisation of that public opinion was carried out by the same newspapers that brought Labor to power in 1972 with viciously personal attacks on McMahon, and “It’s Time” as the front page headline. In 1972 McMahon was blamed for unemployment too. It was not his fault, was it?

To gain control of the Senate, which he had never tried to abolish, Whitlam resorted to open bribery of an opposition member, Senator Vince Gair, in the tradition of banana republics and dictatorships everywhere. When the Parliamentary opposition tried for force the Labor Government to elections by cutting off supply, that Government tried to rule without the consent of Parliament or the people.

Rather than face a democratic election, Whitlam was even prepared to ask the Queen of England to intervene in Australian politics; to sack an Australian constitutional official appointed by Whitlam himself, and allow Whitlam to rule by decree.

If a conservative government had done any of those things, Labor supporters would rightly have been outraged. But Labor supporters prefer to forget about the economic incompetence that cost them their chance in government. They prefer to distract attention from their undemocratic manoeuvres by a loud-mouthed phony republicanism – as though Kerr had caused the constitutional crisis by insisting on elections, rather than Whitlam by refusing to hold them.

Labor supporters adopt the classic conservative and reactionary argument, that an unpopular government should be given a guaranteed period in office so that voters can not throw it out before they find out what was really good for them after all.

After the Kerr business a lot of people suddenly realised what they ought to have known before. That Parliamentary forms do not mean very much and the conservative parties will use every dirty trick to stay in power. It ought to have also taught another lesson – that the Labor Party shares the same basic philosophy.

Neither party is so committed to Parliamentary government that it would fight against Parliament being replaced by military rule in the face of a genuinely revolutionary opposition.

It is sickening how people on the left pretend the economy is crook because of Fraser, when they know perfectly well it is an international problem. We should stop supporting Labor Party lies and start telling the truth about how the capitalist system really works.

Of course we need a target to fight. But if we do not know what that target is, then we had better take time off to find out, instead of just whingeing impotently about Fraser.

Shorter Hours and Higher Pay

Campaigns for a shorter working week and higher real wages have been put forward as a solution to unemployment. The argument is that higher wages will allow workers to buy more goods and so force employers to hire more workers. Likewise shorter hours will require more workers even to produce the same amount as now.

Of course we should fight for shorter hours and higher pay. That will become more difficult as unemployment increases. But it is still possible to win victories, even when there is mass unemployment, for reasons explained earlier. But the effect will be to reduce profits further, not increase them. So it cannot be a solution for unemployment.

In a communist society, any accidental “unemployment” could certainly be eliminated by reducing the amount of work done more rapidly than had been planned. Alternatively, people could work the same hours, but the extra workers could produce more goods so that everyone’s standard of living would rise. But that is because workers would not be “employed”. They would not be used by the owners of means of production to make a profit. They would be the “employers”, using the means of production to satisfy their own social needs.

In a capitalist society production is carried out for profit, not needs. General Motors can certainly be compelled, under some circumstances, to pay its workers more, or let them work shorter hours. But they are in the business of making money, not just making cars. If they can not make more money they are not going to hire more workers just so the workers can buy more cars.

There is no such thing as “overproduction” in the abstract. Whatever Friends of the Earth might say, it is not as though we have too many consumer goods or houses or schools or anything else. Nor have we too many means for producing them. Living standards are abysmally low is most of the world, and nothing to write to another planet about here in Australia. It is just that too much has been produced to be sold at a profit, and that is not a problem you can solve by reducing profits further.

Expanding the Public Sector

Calls to expand the public sector, are becoming more common, (especially from public sector unions!). This is partly just a reaction to government policies aimed at expanding the private sector at the expense of the public sector. But there is also some suggestion that in itself, expanding the public sector would create more jobs and reduce unemployment.

Government job creation schemes either have to be paid for by the rest of the economy, in which case they provide no net investment, or else they have to pay for themselves. In that case they have to sell their products on the market that is already suffering from overproduction and overinvestment. As far as employment is concerned, there is no difference in principle between expanding either the public or the private sector. The problem is that both are contracting, because they both face a lack of markets. Why should one be able to find markets when the other cannot?

In fact, of course, the public sector has expanded quite dramatically and will no doubt continue to do so. There are lots of things capitalist state enterprises can do better than capitalist private enterprises. But this has not prevented unemployment from growing and there is no reason to expect that it will. In Britain for example, some of the biggest layoffs have been in nationalised industries like British Leyland and the British Steel Corporation.

Whether a firm is publicly or privately owned, in a market economy its ability to provide jobs will still depend on its profitability and that will depend on selling its goods on the market. When there is overproduction it affects government owned enterprises exactly the same way as private ones.

It sounds plausible for Australian car workers to demand that the car industry be nationalised to safeguard their jobs. But how has that helped British car workers? What are railway workers supposed to do when their jobs are threatened? Demand that the railways be nationalised? In Britain some coal miners have actually been demanding that their industry be sold to private enterprise because the government is unable to invest funds in keeping their jobs.

Nationalisation is probably a good thing for all sorts of reasons, but reducing unemployment is not one of them. One need only look at Poland or Yugoslavia to realise that even economies completely dominated by the public sector, can have pretty much the same kinds of economic problems as the “mixed economies” of the west. The economic laws applicable to market economies apply whether the capitalise enterprises are owned by shareholders, bondholders, or the state.

Workers’ Co-operatives

There have been some instances of bankrupt firms being taken over by their workers to preserve their own jobs. The Clydeside shipyards, Lipp watch factory and Lucas Aerospace are well known examples. There is also a traditional “co-operative movement” associated with the labour movement, and a movement for workers control and/or “self-management’. Capitalists themselves are also trying to incorporate workers’ representatives in management functions, with extensive legislation for this purpose in West Germany and some other West European countries, and in Yugoslavia and China.

To some extent, workers’ co-ops can positively represent the new form of social production emerging within the old. Just as the emergence of huge transnational corporations and nationalised industries points towards the socialisation of industry, but more antagonistically.

If workers’ demonstrate that they can manage industry better than capitalists, that is certainly worth demonstrating, to pave the way for getting rid of capitalism in future. It may even save specific jobs in specific cases. But so, for that matter, could any other improvement in the management of an ailing firm.

Obviously improvements in the competitive position of a specific firm cannot reduce, but only displace, the unemployment resulting from overproduction in the economy as a whole. Other workers’ in the same industry will lose their jobs as a result of competition from the firm whose management has improved. This may encourage further takeovers, and be well worthwhile, but there is no need to pretend it will reduce unemployment.

Bankrupt industries may not be the best placed to attempt demonstrations of the superiority of workers’ management. If the prospects for a firm are so poor that its owners are prepared to let the workers’ have it, then they must be very poor indeed. The workers will quickly find themselves facing the same problems of finding a market for their products, that the previous management was unable to face.

The workers’ may do better, since they will show more initiative and will know how to increase productivity and so on. But they may also find themselves accepting worse conditions than they would put up with from their former bosses. (Many self-employed people do put up with longer hours etc – the compensation of not having bosses being well worth it). In the end they may find that they too are forced to carry out layoffs.

If we want practice at running industry ourselves, why not start by taking over some really profitable ones, instead of lame ducks? Presumably we cannot because the state power would be used to prevent us. So it comes back to a question of overthrowing the state. I

In itself a co-op need not be anything especially progressive. For example, the ultra-reactionary health funds in Australia are supposed to be owned by their contributors. So are some insurance companies and agricultural marketing organisations. Within a market economy a genuine workers’ co-op is certainly a more progressive form of organisation than the traditional structures, but it still only amounts to the workers collectively being “their own boss”. It does not abolish the status of workers as “employees” of “their” firm, who are “employed” (used, exploited) by it.

In Yugoslavia the entire economy consists of enterprises nominally under workers’ control, but exchanging products with each other, and allocating investments, through the market as in any other market economy. Yugoslavia has one of the highest unemployment rates in Europe, as well as a very high rate of economic emigration.

If all the firms in an entire capitalist economy went bankrupt and were taken over by their workers, to sell each other goods on the market, they would all remain bankrupt. When the working class does take over industry, it will do so collectively as a class, and abolish the market economy, not ” be their own bosses” within it.

To abolish unemployment, we need to abolish the market economy. Any measures that train workers in economic management are beneficial to that, but none can solve the problems of a market economy without actually abolishing it.

We should support workers who take over their bankrupt firms, just as we should support workers fighting for shorter hours or higher pay, or unemployed youths looting shops, but we need not pretend that any of these activities will reduce unemployment.

Labor to Power with Socialist Policies?

Perhaps a Labor Government with more radical policies could solve the problem? Instead of capitulating to business pressure, they could really hit hard with resources taxes, nationalisation, and a siege economy protected from overseas influence. By taking control of the commanding heights of the economy, they could force industry to provide employment whether it is profitable or not.

This sort of program has gained some support in the British Labor Party. Presumably it could become popular here too, although events in Britain may pre-empt that. The “left” program has won some support from traditional Labor Party activists, because of the obvious bankruptcy of previous policies. But it has also been imposed on the British Labor Party by fairly manipulative means, by people who know they cannot get as much support for their program by going to the working class directly, as they hope to get by working through the Labor Party. It is not a socialist approach, let alone a revolutionary one, because it is based on making social changes from above, without the support and against the wishes of the only people who can really change society – the masses themselves. If it could succeed, the result would be a more bureaucratic and less democratic society – a corporate state, not socialism.

There is an ideological convergence between the interest of the bureaucratic bourgeoisie in state owned industries, trade union bureaucrats, state employed intellectuals and so on, in promoting this “statism” as “socialism”. A more fascist face of a similar basic ideology can be seen in Eastern Europe and in the French Communist Party. The techniques of demagogy and manipulation also have a lot in common.

A feature of this approach, is an identification between “socialism” and “government controls”. The solution to practically any problem is supposed to be a government regulation compelling private industry to act more in accord with the public interest. That identification is promoted heavily by ideologists of the right, like Milton Friedman, who exploit resentments against “big government” and bureaucratic regulations”.

In fact government regulations are required in a market economy because of the inherent antagonism between the interests of each separate producer, to maximise their own profit, and the public interest in things like a better environment, safe working conditions, better products and so on. The regulations are effective by making it more profitable for firms to modify their behaviour in the public interest, than to go on ignoring the public interest. The same effect is achieved by various selective taxes, allowances and so on. Where regulations cannot overcome the limitations of production for the market, the bourgeois state itself will step in and provide a “public service” – such as roads, broadcasting, education and so on.

There is always a need for more regulations, because the bourgeois state is unwilling to interfere with the private interests of various sections of the bourgeoisie as much as it should. So naturally, progressives often find themselves involved in campaigns for more government regulation to restrict some particular abuse or other. Likewise there is always a need for more “public services” because the bourgeois state is always reluctant to assume responsibility for an activity that might have been carried out by some particular section of the bourgeoisie. So we find ourselves involved in campaigns for more public services.

In these campaigns, the interests of sections of the bourgeoisie tied to state capitalism, often coincide with those of the working class. This is nothing new – a lot of social progress within capitalism has depended on one section or another of the ruling class breaking ranks from the others. But we should not delude ourselves that the bureaucrat bourgeoisie and their trade union hangers-on are in any way “socialist”.

The statist approach can never turn private production for profit into its opposite – social production for use. Regulations are symptoms of the basic antagonism persisting, while the elimination of unemployment and economic crisis requires a removal of that underlying antagonism. We need to abolish private production, not just provide more public services.

A socialist economy would actually require less regulations and controls than a market economy. Even the “public sector”, and as such enterprises became genuinely “public” they would cease to be separate enterprises having separate interests from the “public” at all. You do not make regulations governing your own conduct at home, so why should you do so at work?

The result of the “left” influence on the British Labor Party has of course already been a sizeable swing of Labor support to the new Social Democratic Party, even though the Labor Party has not yet fundamentally broken with its traditional “labourism”. This will presumably produce a Labor Party and trade union backlash against the “left” program that is alien to the traditional outlook of Labor Party supporters. Alternatively, the present two party structure in Britain may be replaced with a new one, leaving the “entrists” once again out in the cold, and the traditional Labor supporters once again bankrupt. You cannot change people’s political consciousness by stacking their party meetings, and most workers prefer their present bosses to the proposed new ones.

Economic Consequences of Statism

Let us leave aside the political aspect and look at the economic consequences of a statist program being implemented. Remember, we are not talking about a popular revolution in which the working class takes command of society and re-organises it. If that was the aim, the method would not be through the Labor Party. We are talking about policies to be implemented by a parliamentary government, with the existing state machine still in place, and with the working class still tied to its traditional organisations. Viewed in that light, we have an excellent recipe for a Chile style disaster.

Every measure proposed is designed to transfer economic power from private industry to a government hostile to private industry, without actually expropriating private property. The present owners and managers of industry are to be directed to carry out economic policies hostile to their own interests. But why on earth should they comply?

In themselves, the measure proposed as an “alternative economic strategy” could only reduce profitability and jam up the economy completely. Not capitulating to business pressure must mean reducing profits and therefore reducing private investment and job creation. “Controlling” foreign investment must mean less foreign investment and so less jobs.

Legal nationalisation would just mean saddling the government with a lot of businesses that were already in trouble, plus additional debts to pay off their owners. If capitalism survives the coming crisis it will certainly be with a great deal more nationalisation and state capitalism, but that would be part of the emergency re-structuring after the crisis, not a means of preventing it.

Perhaps the aim of crippling business profitability would not be legal nationalisation, but to force capitalists to hand over their enterprises to the government without compensation. A roundabout sort of expropriation. But if the aim is expropriation, this is a rather odd way to go about it. Expropriation means confiscating the property, worth thousands of millions of dollars, of the class that has up till now ruled society. That class has shown a definite tendency towards hysteria when its property rights are even mildly infringed upon, let alone denied entirely. What on earth is the point of leaving them in charge of industry while you are expropriating them? If they are not kept under lock and key, surely they should not actually be the people asked to implement government directives against their basic interests?

What else could they do except sabotage things in every possible way, and ensure the government is blamed for the economy being in a far worse state than it was before? In war, when one army defeats another, the first thing it does is confiscate the losing side’s weapons. It does not put them in charge of guarding the armories and performing sentry duty. The bourgeoisie’s weapons are its control over industry (not to mention its military weapons).

If our aim is to confiscate the property of the ruling class, then we need our own state and our own army to establish that state. Trying to do it through cabinet ministers in their state, surrounded by their officials and their armed forces, seems rather odd. It sounds like just a complicated way of getting those ministers killed, and anyone silly enough to be associated with them, killed also.

Fortunately, the chances of a Labor Party with “left” policies gaining office seem quite remote. So we need not worry too much.

Protectionism

Unlike other “solutions” proposed from the labour movement, increased tariff protection could have an immediate positive impact on employment in Australia. By restricting other countries from access to Australian markets, the opportunities for employment creating investment in Australia are necessarily widened, at the expense of course, of jobs in other countries.

It is amazing how “leftists” put forward the most blatantly chauvinistic proposals for displacing unemployment from Australian to Asian workers, with pious references to opposing their low wages, exploitation by fascist regimes etc.

Apart from elementary class solidarity, the catch with protectionism is of course, that it cuts both ways. It is to the selfish advantage of any country to restrict its markets. But when all countries do it the result is a loss of markets for all.

While world trade is expanding, there is an increasing “cake” and different countries have been able to agree on how to divide it up. As the crisis intensifies pressures for protectionism will become stronger even though everybody knows the result will damage everyone. So will the pressure for trade wars, and real wars.

Protectionism is inevitable as world trade spirals downwards, but we have no interest in promoting it.

“Militant Struggle”

In their newspapers some political groups urge “militant struggle” as the workers answer to the “employer’s offensive”. It is not entirely clear what this means, if it means anything. But presumably it must be intended to suggest that layoffs and the like are not the result of blind market forces, but are some kind of conscious conspiracy by the capitalist class in order to weaken the working class. By fighting back hard enough, workers can force employers to abandon their “offensive” and restore full employment.

This is obvious nonsense, nor worth discussing. But it does raise the question of how much can be achieved by resistance to layoffs and cutbacks. The answer is, of course, that “if you don’t fight, you lose”. People have to fight or they get ground down, and you can win specific improvements by fighting.

But you cannot change the overall working of the system by this sort of fight. Since we are going to be forced into all kinds of defensive struggles, often losing ones, it is pretty important to be developing an offensive strategy that can win as well. Otherwise it gets rather demoralising. We need to be able to say what could be done about the economic situation as well as just resisting its consequences.

Instead of that, trade unions tend to just resist and lose, in a fairly hopeless sort of way, or even turn the battle against other sections of workers. Often, trade union responses to unemployment ignore the fact the employed and unemployed workers are both part of the same labour force, with common class interests. Trade unions often emphasis protecting the jobs of people who already have them, and especially those who have had them longest – at the expense of school leaves, housewives, part-timers, casual workers and others who need jobs, and perhaps need them more desperately than those protected by “seniority”.

Like demarcation disputes, these trade union efforts can be very “militant” without any positive result. Trade unions are basically conservative organisations concerned with selling their members’ labour power at the best price they can get. We should aim to unite the employed and unemployed workers rather than just protecting the separate interests of employed workers from unemployed ones.

Militant struggles against redundancies, factory occupations and so on, can also suffer this problem to a certain extent. Even if they can actually save the particular job at stake, which is unusual, they can not reduce the size of the pool of unemployed and can only displace unemployment from one group of workers to others, often within the same industry, or even the same firm.

Employers may conceivably be forced to keep a particular factory open, although that is often just as hard as finding new jobs. But it is pretty difficult to change the fact that the total amount of labour required in an industry has declined. The question will be whether a particular factory gets closed down or other factories stop taking on school leavers to replace retirements. Either way, unemployment will grow, but it will affect different groups of workers directly.

The same applies to struggles against “the cuts”. The plain fact is that the government is forced to cut its expenditure because it just has not the resources to sustain it. There is no conspiracy. Nevertheless, what gets cut where, and how much of the brunt is suffered by who, will be influenced by class struggle. So it is worth fighting back. As long as the fight is not just suggesting that some other, more vulnerable section of the working class should cop the lot.

Just saying “cut defence” sounds like an easy way out. But the whole defence budget would not make all that much difference, and it avoids some hard questions about how to deal with Soviet aggression. In practice, if the budget cannot be increased, struggles against the cuts will, whatever people might say and want, just divert cuts from health to education, or education to welfare, or welfare to health.

If we want to not only oppose any cuts at all, but also demand improvements in welfare and public services, we need to have definite proposals about how this can be achieved. We should certainly support militant defensive struggles. But they cannot be put forward as a general answer to unemployment and economic decline.

Revolutionary Optimism

This whole paper so far may sounds rather pessimistic and deterministic. It seems unemployment is inevitable and there is nothing that can be done. But that is only true if your perspective for “something” is for some reform within the capitalist system. Things are grim for reformism, but not for revolution.

Recognising the inevitability of certain laws under capitalism is not deterministic. It implies that the way out is to abolish capitalism. Revolution is a voluntaristic act that must be carried out consciously. The next section, to be published later, (editor’s note: this refers to part 7) discusses revolution. It suggests how the economic situation could be resolved by revolution and suggests that revolution is a perfectly matter of fact “solution” that makes far more sense than the others that have been put forward.

(Next instalment: Revolution, drafted in 1982)