Capitalism in Crisis – a socialist solution

This is a review of the pamphlet “Capitalist Crisis – ‘Alternative Strategy’ or Socialist Plan” by Andrew Glyn, which has been recently republished with a new introduction.

Many people have looked to the left for answers to the crises of capitalism, since the downfall of financial markets across the globe from 2008 and the stagnation of the economy. Austerity is not some blip that can be transcended but is here to stay – driven by the internal contradictions of the capitalist system itself.

Andrew Glyn was writing in 1979, before the doctrine of neoliberalism held sway, and at a high point of industrial struggle which had won gains for working people. At the time, 13.5 million people in Britain were members of trade unions. The Tories, under Edward Heath, had been defeated by the miners’ strike of 1974; there was still a strong manufacturing base in the UK, and while there was a right-wing Labour government under James Callaghan, the left had a strong presence in Labour and the trade unions – cause for optimism, you might think going into the 1980s.

In 1979, there were 1 1/2 million people unemployed, a figure that seems laughably low nowadays, where millions are on zero-hour contracts, work part-time, have to work two or three different jobs to make ends meet, or are unable to find work. However, Glyn points out that if a determined socialist government were to initiate full employment, this would create enough wealth to increase minimum earnings, initiate a programme of council house building, provide an increase in pensions and better fund schools and hospitals.  An unemployment rate of 10%, he estimated, involved underproduction of 20%. Nowadays, the gap between what could be attainable and the conditions people are living under, has grown. The eight richest men in the world now own as much wealth as the bottom three and a half billion. Inequality has risen inexorably since 1979, due to deliberate policies of smashing the strength of the trade unions, with the defeat of the miners’ and the printers’ unions, the down-grading and de-skilling of jobs and casualisation of employment.

So why are we in such a mess? Unemployment provides capitalism with a “reserve army” of labour, which it can use to keep wages low, keep people hungry for job opportunities and enables more profits to be made at the expense of the working class. The pamphlet discusses the fall in the rate of profits, which has led big business to demand that the Callaghan government implement what was called, quite laughably, “The Social Contract”. A contract implies that we have some say in what was going on. In reality, Labour capitulated to the demands of big business for increased profitability, in return for cuts to living standards and cuts to public services. In this, we can see the beginnings of the policy of neoliberalism, which decimated communities, tore down industries and built a ramshackle service economy in its place, which meant a few city spivs became extremely wealthy, while the vast majority of people suffered. This was a vendetta carried out by the Tories against the trade unions.

In place of austerity, the Communist Party and Tribune put forward an “alternative strategy”. This was based on the idea of import controls, price controls, bringing banks under public ownership, defence cuts and increased investment in public services. The pamphlet does not argue that these measures would not be welcomed by the working class or that they should not be fought for, rather it questions how these reforms are to be brought about without huge pressure being brought to bear by capitalism, and how such pressure is to be resisted.

Leon Trotsky put forward a different sort of programme, which sought to win reforms for workers, but kept in mind that ultimately, global socialism is necessary in order for such gains to be consolidated. We have seen since the Labour victory of 1945, that the welfare state, the NHS, the nationalisation of the railways, public transport and the utilities, have all been destroyed by the ideology of the so-called ‘free’ market. Socialism needs to be tied to concrete demands and to be linked to the aspirations of ordinary people. However, it is utopian, as Glyn argues, that reforms can be won and held through capitalist democracy.

We have seen the pressure been brought to bear on left wing governments in the past. The pamphlet mentions the military coup against Salvador Allende in Chile, which toppled a hugely popular and democratically elected leader. More recently we have seen the vitriolic attacks against Jeremy Corbyn by the right-wing press, and the capitulation of the Syriza government in Greece to the demands of the Troika. It is naive to think that any left-wing government would be handed largesse from the pockets of the bosses, to revitalise the economy.

The measures put forward in the alternative strategy amount to a Keynesian approach to economics, an attempt to kick-start capitalism back into life, increasing wages and putting money into public services. The CBI, recognising the effects of neoliberalism on the world’s poor, fears revolts, strikes and uprisings, and has encouraged governments to do just this. However, no government is in the process of implementing such a programme, as austerity has become so embedded in the economy that any such measures would reduce profits in the short-term. The only answer to this contradiction is to move to a planned, socialist economy, to take profit out of the equation completely.

The final part of Glyn’s pamphlet explains what a genuinely socialist plan of production would look like. The largest companies and the banking system should be taken into public ownership and controlled democratically, from below. Production could be based on people’s needs and the needs of the planet, rather than funnelled into short-term profiteering. The only people who would lose out would be the rich businessmen, who are fleecing the rest of us.

The wastage inherent in capitalism and the pointless duplication of new models to capture more of a market share, and the constant drive for endless consumption would be eliminated. Full employment would mean a shorter working week, and people would be more involved in their jobs, gradually eliminating the need for micro-management, drudgery and sanctions that are a feature of capitalism.

However, such gains cannot be won without a revolution, to change the nature of society completely and for good. Such a revolution would need to be carried out initially in one country, and be the impetus for working people across the world to rise up. As Glyn puts it, “simply winning the argument and securing a Parliamentary majority for a socialist programme” is simply not going to cut it with the rapacious system of globalised capitalism.

This is not to say that gains cannot be won under the present system, or that socialists should abstain from standing in elections. We need to engage with people, put forward a coherent programme based on their expectations and to explain that we need to take control back for ourselves as a class, in order to change society. The alternative is continued austerity, environmental destruction, economic wastage, high unemployment and a shocking waste of potential for the whole of the human race.

 

 

 

 

 

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