About 70 students squeezed into a lecture room at Varndean Sixth Form College, Brighton, last Thursday to hear Ray Jones, chair of the South-east District New Communist Party. This was part of a series of lectures organised by Roy Cullen of the Politics Department covering a broad range of viewpoints. The following is what Ray had to say.
WHEN PEOPLE hear I’m a communist they often say, “Oh, communism is a great idea but it will never work.” The implication is that capitalism may not be a good idea but at least it’s practical.
The reply that usually springs to mind is whether the starving in the slums of South America, India or Africa find it so practical — or for that matter the homeless on the streets of Brighton.
But after the recent financial events around the world surely we should be asking, does it really work at all!
The writing is on the wall for all those who have eyes to see. Banks have been going under or have been bailed out by governments with loans of billions of dollars. The British government has stepped in with £500 billion and the term semi nationalisation has been used, yet still it goes on. Will we see another crash like the one in 1929?
Or will it be even worse and capitalism descend into chaos?
When the final crisis will come is impossible to predict but it will come in spite of states intervening in ways that make capitalist purists’ eyes water! These methods smack too strongly of socialism for them — their god is still the Market.But capitalist governments know that they have no other choice. Its either that or be swept away in a flood of either revolution or barbarism.
This not socialism of course but merely the capitalist state propping up its system. That is the role of the state.
They will of course try to make working people pay for this problem through taxes and loss of services and we will have to resist that.
But this intervention may have progressive aspects in so far as it helps working people in this crisis (if it does); in so far as it begins to lay the foundation of a different economic system of state ownership and in so far as it suggests to the workers that perhaps private ownership is not as essential as we have been led to believe!
After all if capitalism is so efficient and so necessary why is it that when a major war or crisis breaks out every thing fundamental to the economy is nationalised?!
It would be vastly ironic if George W Bush went down in history as the president who laid the basis of socialism in the USA!
But why do capitalist crises happen?
To try to answer this it is necessary to look at the roots and nature of capitalism.
With the industrial revolution, capitalists found that they could employ people in factories producing goods to be sold on the market and at the end of the process they were left with huge amounts of money.
Where did this surplus, this profit, come from?
There are still economists today who find this a mysterious, mystical process but Karl Marx had an answer in the 19th century.
Value is added to the materials by the labour of the workers. The goods could be sold over and above all the costs of producing them because of the work, the labour power, expended on them.
Workers only spend part of their time producing enough goods to make, when sold, enough money for their own wages. The rest of the time they are in fact producing profit for the owners.
Because the owners, the capitalists, controls the process, the means of production, they are in the position of being able to cream off the profit produced by the workers for themselves.
They ensure that wages are less then the extra value put into the goods and they pocket the difference.
You often hear of manufacturers “adding value” to their goods by making them more complex. They are adding more labour time to the product which adds value and means they can put up the price.
A T-shirt with a design on is worth more, all other things being equal, than a plain one. What is different? The extra work gone into it (plus some extra costs but these tend to be small).
If the capitalist passed on this value where it is due, the workers, the capitalists would be no better off — so they try not to!
But there are limits to this exploitation of workers. The work force has to be able to maintain itself — they wouldn’t want workers dying of starvation on the job would they? That would be messy and inconvenient!
But beyond that there are limits set by the social conditions of the time: such as the demand for labour on the labour market — because workers’ labour becomes a commodity too.
But limits are also set by the strength of the workers themselves – because workers are not like pieces of cloth or sewing machines.
They are capable of understanding the situation and they are forced into collective defence of their living standards in unions and eventually for their broader rights in political parties.
And so you have the essential and continual conflict within capitalism between bosses and workers over the value added by labour power.
Surprisingly perhaps an increase in machinery and technology by itself actually decreases the profit of the capitalist because there is less labour power needed and less labour power means less value and less surplus value — that is profit.
To escape this problem the capitalist must increase the scale of the whole production process so the number of workers is increased.
Although each individual worker produces less profit there is over-all more profit produced, which helps in the short term. But then the next improvement in technology, spurred on by competition, sets the process in motion again and so on in a vicious circle.
Or the capitalists can try to decrease the workers’ share to maintain or increase their own. The profit must come from somewhere, if not from their workers at home then from workers overseas, where wages are lower.
Many British companies have shifted manufacturing abroad to areas of cheap labour — even services such as call centres have been moved.
Wars are fought to establish influence over areas of the world and enable capitalists, joined together in national states, to control resources. Iraq of course is a good example — although the US is having a lot more trouble getting the oil than it expected!
Wars also destroy commodities, weapons as well as everything else, and therefore help counteract over production — which is the bane of capitalism.
Capitalism struggles to produce more profit and in the process more goods are produced. Prices fall because less value is going into the goods and because of competition between the capitalists and the tendency to flood the market.
But wages also fall because there are fewer jobs on the labour market and competition for jobs increases. Also there is deskilling on a large scale and therefore lower wages. So the workers, the majority of the population, still cannot afford to buy the goods.
So the system goes into a nosedive, as in the 1930’s, until enough goods are destroyed in war or wasted or a new technology comes along and helps them squeeze more profit from the workers.
Millions die therefore, in war or famine, in the service of capitalism.
These problems are not brought into the system by militant workers or communists but are part of it. Part of the nature of capitalism.
It’s true that this time the crisis seems to have started in the US housing sector with mortgages being given to people who could never afford to repay them to — such an extent that the whole banking system started to go into melt down.
Banks stopped lending to each other because no one was sure who was in serious trouble and then the anarchy of the stock market came into play. And when banks cease to lend to each other this limits their ability to lend to others.
Capitalism needs the credit system to oil its wheels — but it can’t stop its abuses and out and out swindles that escalate as the crash approaches.
So businesses stagnate and eventually go under without credit. People are unemployed and cannot pay their debts or buy goods and so the whole thing snowballs.
But the US economy never really recovered from the stock market crash of 2002 when the so-called internet bubble burst.
Even the stimulus of $2 trillion in military spending over five years did not significantly increase employment and now the jobless numbers are rising swiftly in a low wage economy.
We can see the low wage economy being built in Britain with so many young people doomed to the fast food industry.
The system cannot go on forever. This may not be final apocalyptic crisis but if we do not do something about it, if we do not guide its death throws into a revolution that produces a collective, planned, rational society that is not based on exploitation, eventually the end result will be melt down and barbarism.
That is why we need a party that understands this and acts accordingly. We in the New Communist Party are trying to build that party.
This party must fight for the good of the working class as a whole — not just a section of it.
It must work to unite the class around demands that advance and benefit all workers because only a united working class can ultimately win against a capitalist class which, history has shown, will fight desperately to keep what it has.
And it must fight both for short term and long term aims. Both for immediate reforms such as:
• for better wages and conditions,
• better education,
• better health services,
• better housing,
• a better environment,
• against war,
• against authoritarianism and injustice and for more democracy (that is more say for the workers),
• against racism, sexism and homophobia, which can divide the workers.
And for revolutionary objectives at home and support for socialism in other countries such as north Korea, China, Cuba, and Vietnam.
Short term victories are possible. They are good in themselves and act as schools of struggle, but in the longer term a revolution, the overthrowing of capitalism, is necessary to right the wrongs in our society.