State Socialism and The Communist Manifesto

Karl Marx’s alternative to capitalism part 46

In the Communist Manifesto Marx states that ‘the first step in the workers’ revolution is the elevation of the proletariat to the ruling class, the winning of democracy.  The proletariat will use its political rule to wrest bit by bit all capital from the bourgeoisie, to centralise all instruments of production in the hands of the state, i.e., of the proletariat organised as ruling class . . . ‘

There then follows a set of demands that ‘will naturally be different depending on the different countries.  For the most advanced countries, however the following can be put into effect fairly generally.’  There is then a list of ten demands of which the most relevant for our purposes are –

‘5 Centralisation of credit in the hands of the state through a national bank with state capital and an exclusive monopoly.’

‘6. Centralisation of the whole transportation system in the hands of the state.’

‘7. Increase in national factories and instruments of production, reclamation and improvement of land in accordance with a common plan.’

These demands would appear to entail the introduction of socialism through actions of the state – albeit with the vital condition that this is a state in the hands of the workers – with state control of industry etc. under a centralised plan as the objective.  This is in obvious contrast to Marx and Engels antipathy to (capitalist) state ownership and control as noted in previous posts; their opposition to a putative necessary role for the state in sponsoring workers cooperatives; and the prominent role they give to cooperatives in the development of the working class, its movement, and its heralding of a new socialist society.

To anticipate the argument to be presented: the Manifesto was written quickly, in particular circumstances, and, more importantly, at an early part of Marx and Engels’ political careers, including before their experience of the Paris Commune.  However, none of this explains, or rather explains away, these passages since much of what is written in the Manifesto Marx and Engels defended for the rest of their lives.

If we take the opening lines quoted above: ‘the first step in the workers’ revolution is the elevation of the proletariat to the ruling class, the winning of democracy’, it must be said that while control of the state is required to secure the rule of any ruling class, such control does not make a class the rulers of society.  Only in relation to the means of production can a class be constituted as the ruling class.  Even were the working class to ‘win democracy’ it would not yet be a ruling class unless this democracy included its ownership and control of society’s productive powers.

Of course, Marx goes on to say that ‘the proletariat will use its political rule to wrest bit by bit all capital from the bourgeoisie, to centralise all instruments of production in the hands of the state’ but again, the state is a separate body of men and women and cannot be considered to be synonymous with the working class.  So, if the state has its hands on the means of production it means the working class does not, and this is true even if the workers state is democratic.  As noted before, state title to the productive resources of society would only be consistent with effective workers’ ownership if it performed the negative function of preventing alienation of particular factories etc from the collective ownership of society and their appropriation as private capital.

Immediately after the ten demands, Marx states that ‘when, in the course of development, class distinctions have disappeared and all production is concentrated in the hands of the associated individuals, the public power loses its political character.’

As Marx then says, ‘political power in its proper sense is the organised power of one class for the oppression of another.’  For the ‘public power to lose its political character’ the state would therefore have to cease to exist, but how does production leave its hands and come into the hands of the ‘associated individuals’?

The state, as instrument of ‘oppression’ is unsuitable for control of production and certainly for its exercise by the working class, and it is only by the working class becoming the ruling class can the state ‘wither away’, as it was later put by Lenin.  The working class can therefore only be a ruling class through its role in production and can sustain and defend its position, at least initially, only by having a state of its own.

The socialist scholar, Hal Draper, states that the term ‘winning the battle of democracy’ (in one translation of the Manifesto) was cryptic and reflected Marx’s lack of certainty over whether this meant the victory of the democratic bloc existing in much of Europe at the time, that did not seek to go beyond capitalism or bourgeois rule, or outright proletarian rule as might be thought given the context.

The first edition of the Manifesto was in German and at this time only a bourgeois revolution was immediately anticipated in Germany – “the Communists turn their attention chiefly to Germany, because that country is on the eve of a bourgeois revolution . . .”  The ten demands can be better understood as the programme of a radical bourgeois revolution that the working class would support in light of its own weakness and inability at that time to achieve its own class rule.  This incapacity did not however mean that the working class was ever to cease for a minute to organise to defend and advance its own particular interests. 

In the later 1872 German preface to the Manifesto Marx makes the following points:

‘However much that state of things may have altered during the last twenty-five years, the general principles laid down in the Manifesto are, on the whole, as correct today as ever. Here and there, some detail might be improved. The practical application of the principles will depend, as the Manifesto itself states, everywhere and at all times, on the historical conditions for the time being existing, and, for that reason, no special stress is laid on the revolutionary measures proposed at the end of Section II [the ten demands].’

‘That passage would, in many respects, be very differently worded today. In view of the gigantic strides of Modern Industry since 1848, and of the accompanying improved and extended organisation of the working class, in view of the practical experience gained, first in the February Revolution, and then, still more, in the Paris Commune, where the proletariat for the first time held political power for two whole months, this programme has in some details been antiquated. One thing especially was proved by the Commune, viz., that “the working class cannot simply lay hold of the ready-made state machinery, and wield it for its own purposes.”’

The Manifesto speaks of the proletariat using its political rule to wrest bit by bit all capital from the bourgeoisie, to centralise all instruments of production in the hands of the state, i.e., of the proletariat organised as ruling class . . .’  It goes on to say that this involves ‘measures which seem economically inadequate and untenable but which in the course of operation drive beyond their own limits, and are unavoidable as a means of transforming the whole mode of production.’

These might seem to have some correspondence to Trotsky’s approach laid out in the Transitional Programme, but here they relate to measures to be implemented following the already achieved ‘political supremacy’ of the working class and not the programme that precedes it.  In this context it should also be said that a ‘transitional’ approach that substitutes demands for expropriation by the (capitalist) state in place of workers’ expropriation is a very different approach and involves a different transition.

Draper notes that:

‘the Manifesto was one of the few writings in which Marx spoke in terms of state ownership of the means of production.  He usually left open the question of the forms of social ownership, which might include workers’ associations and cooperatives.  The emphasis in the Manifesto reflected the emphasis in the movement for which it was written at the time.  State ownership (by a workers’ state) was, to be sure, one form of social ownership for Marx.’

Draper also endorses the view that the demands were not specifically those of Marx or Engels but already existing and agreed demands of the Communist League, for whom the Manifesto was written.  He also notes the extent that some other specific demands did not represent Marx’s own views, (in The Adventures of the Communist Manifesto).

These demands accord with other programmatic statements such as The Demands of the Communist Party in Germany, which were set out as the programme to be adopted in what was understood to be a radical democratic revolution, but not yet a working class and socialist one.  In the Manifesto Marx employs the argument about their transitional nature in order to cover this (rather wide) gap, but their realisation would not achieve socialism even if it would strengthen the existing position of the working class and its future struggle. 

Marx states in the Manifesto that when the proletariat ‘has become the ruling class by revolution, and as such has destroyed, by force, the old conditions of production, it destroys, necessarily, with these conditions of production, the conditions of existence of all class antagonism, of classes generally, and thus it destroys, also, its own supremacy as a class.’

Like Engels in Anti-Duhring, the prospectus is of the state dying following working class revolution and the means of production becoming the property of the associated producers, i.e. the working class.  Since no capitalist class would now exist, and no other class could have ownership of the means of production, all class distinctions are removed and the division of society into classes disappears.

In this process many questions arise as to sequence, timing and agency and the telescoped summary in the Manifesto can only be properly considered with due regard to the development of Marx’s views at that time.  It is possible to quote Marx and Engels in favour of state ownership but not possible to make this consistent with other major statements of view; with the consistency of their overall perspective and programme, or their foundational beliefs.

Two years after the publication of the Manifesto Marx, when he still had hopes for an approaching revolution, hoped that the communists could “make the revolution permanent until . . . at least the decisive forces of production are concentrated in the hands of the workers.” (Address of the Central Committee to the Communist League)

Back to part 45

State support for the workers?


Karl Marx’s alternative to capitalism part 45

The first premise to the rules of the First International, written by Marx in 1864 as the first clause, was that ‘the emancipation of the working classes must be conquered by the working classes themselves . . .’

In 1882 Engels in London wrote to the German socialist August Bebel:

‘The development of the proletariat proceeds everywhere amidst internal struggles and France, which is now forming a workers’ party for the first time, is no exception. We in Germany have got beyond the first phase of the internal struggle, other phases still lie before us. Unity is quite a good thing so long as it is possible, but there are things which stand higher than unity. And when, like Marx and myself, one has fought harder all one’s life long against the alleged Socialists than against anyone else (for we only regarded the bourgeoisie as a class and hardly ever involved ourselves in conflicts with individual bourgeois), one cannot greatly grieve that the inevitable struggle has broken out.’

One such famous internal struggle was against the draft programme of the United Workers’ Party of Germany. The Critique of the Gotha Programme is a document based on a letter by Marx written in early May 1875 to the Social Democratic Workers’ Party of Germany (SDAP), with whom he and Engels were in close association. 

The Critique, published after his death, was among Marx’s last major writings and is named after the proposed platform for the new united party to be created at the forthcoming congress, to take place in the town of Gotha. At the congress, the SDAP (“Eisenachers”, based in Eisenach) planned to unite with the General German Workers’ Association (ADAV), followers of the deceased Ferdinand Lassalle.

The Eisenachers sent the draft programme for the united party to Marx for comment. He found it negatively influenced by Lassalle, whom Marx regarded as an opportunist, and Marx’s response offers perhaps his last extended summary on programmatic strategy.

In a letter to Wilhelm Bracke, Marx states that “After the Unity Congress has been held, Engels and I will publish a short statement to the effect that our position is altogether remote from the said programme of principle and that we have nothing to do with it.’  Describing it as a ‘thoroughly objectionable programme that demoralises the Party’, he vowed not to ‘give [it] recognition, even by diplomatic silence.’ 

The document discusses numerous questions but it is particularly useful in presenting Marx’s views on strategy before working class conquest of political power, including the two questions at issue in our latest posts – on the cooperative movement and the role of the state.

It should be noted that Marx was not against socialist unity but did not support the abandonment of political principle in order to achieve it:

‘If, therefore, it was not possible — and the conditions of the item did not permit it — to go beyond the Eisenach programme, one should simply have concluded an agreement for action against the common enemy. But by drawing up a programme of principles (instead of postponing this until it has been prepared for by a considerable period of common activity) one sets up before the whole world landmarks by which it measures the level of the Party movement.’

Marx prefaced these remarks by saying that ‘every step of real movement is more important than a dozen programmes’, and he undoubtedly saw the cooperative movement as involving just such steps.  Following the experience of the Paris Commune just a few years before he had also learned lessons from the real movement of the working class in relation to the role of the state.

The offending paragraph of the proposed united German Party stated:

‘The German Workers’ party, in order to pave the way to the solution of the social question, demands the establishment of producers’ co-operative societies with state aid under the democratic control of the toiling people. The producers’ co-operative societies are to be called into being for industry and agriculture on such a scale that the socialist organization of the total labour will arise from them.”

Marx notes sarcastically that:

‘Instead of arising from the revolutionary process of transformation of society, the “socialist organisation of the total labour” “arises” from “state aid”; that the state gives to the producers’ co-operative societies and which the state, not the workers, “calls into being”. It is worthy of Lassalle’s imagination that with state loans one can build a new society just as well as a new railway!’

He goes on, quoting the programme’s own words:

‘Second, “democratic” means in German “Volksherrschaftlich” [by the rule of the people] But what does “control by the rule of the people of the toiling people” mean? And particularly in the case of a toiling people which, through these demands that it puts to the state, expresses its full consciousness that it neither rules nor is ripe for ruling! . . .  The chief offense does not lie in having inscribed this specific nostrum in the program, but in taking, in general, a retrograde step from the standpoint of a class movement to that of a sectarian movement.’

The socialist scholar Hal Draper has argued that ‘Marx’s objection to the “state aid” nostrum was not to “state aid” per se but to its place in the programme.’  What it had become in the hands of their ex-leader Lassalle was ‘a universal panacea’ and substitute for a rounded programme because the programme had no other socialist plank within it.  The state-aid plank was already in the existing Eisenachers’ programme but only as one of many measures.  On its own the demand was acceptable as part of a larger strategy as Engels argued:

‘that the universal panacea of state aid should be, if not entirely relinquished, at any rate recognised . . . as a subordinate transitional measure, one among and alongside of many other possible ones.’

But not as the strategy as a whole, which would make the working class dependent on state support: in effect with the same sort of result as today’s demands for widespread ‘public ownership’ and ‘nationalisation’; plus much of the approach to state redistribution of income. 

Draper turns the issue into an aspect of Marx’s support for reforms but not for reformism; a question of what place reforms have in the programme, and not of reforms being assigned a certain all-encompassing role as the be-all and end-all.  He also notes that holding up this single point in the programme is sectarian – holding aloft a particular demand that differentiates the Party from the working class movement.  An approach that does not seek to marry the understanding of socialists to the real struggles of the working class and its organisations.

Marx goes on to say in his Critique:

‘That the workers desire to establish the conditions for co-operative production on a social scale, and first of all on a national scale, in their own country, only means that they are working to revolutionize the present conditions of production, and it has nothing in common with the foundation of co-operative societies with state aid. But as far as the present co-operative societies are concerned, they are of value only insofar as they are the independent creations of the workers and not proteges either of the governments or of the bourgeois.’

So, it is not the case that the Party’s support for workers’ cooperatives could routinely and always supplement support with calls for state assistance, rather in the way that today nationalisation is often accompanied with the call for ‘workers’ control’; but that such state support can be acceptable and may not on its own invalidate the workers’ efforts.  However – ‘they are of value only insofar as they are the independent creations of the workers.’

This need for independence of the workers from the state is highlighted in the following section of the Gotha Critique, beginning by him quoting the programme that ‘according to [section] II, the German Workers’ the party strives for “the free state.” 

Marx says of this that:

‘Freedom consists in converting the state from an organ superimposed upon society into one completely subordinate to it; and today, too, the forms of state are more free or less free to the extent that they restrict the “freedom of the state.”

‘The German Workers’ party—at least if it adopts the program—shows that its socialist ideas are not even skin-deep; in that, instead of treating existing society (and this holds good for any future one) as the basis of the existing state (or of the future state in the case of future society), it treats the state rather as an independent entity that possesses its own intellectual, ethical, and libertarian bases.’

This reminds us of Engels’ remark in an earlier post that the state represents society and the conclusion we drew that ‘In each case the state represented those classes that owned and controlled the means of production (at least of the social surplus), so that the capitalist state defends the ownership of the means of production of the capitalist class.  The analogous role of the workers’ state is not to direct and manage its own ownership of the means of production but to defend the ownership by the working class of the means of production.’

For Marx ‘the whole programme, for all its democratic clang, is tainted through and through by the Lassallean sect’s servile belief in the state . . .’

The Critique of the Gotha Programme, published after his death, was among Marx’s last major writings but at the time German socialist Wilhelm Liebknecht, who supported the unity initiative, attempted to censor his criticism.  Only in 1891, after threats by Engels, was the Critique published.  Much of today’s Marxist movement gives every indication that this censorship was, in fact, successful.

Back to part 44

Forward to part 46

The role of the workers’ state

Karl Marx’s alternative to capitalism part 44

In the previous post we noted that state ownership appeared an inevitable progression of the capitalist mode of production and could be read as a tendency to complete its development, with ‘the partial recognition of the social character of the productive forces forced upon the capitalists themselves. Taking over of the great institutions for production and communication, first by joint-stock companies, later in by trusts, then by the State. (All quotations from Engels’ Socialism Utopian and Scientific)

Such an outcome would not be socialism as some political tendencies might suggest with their programmes for widespread nationalisation: ‘the transformation, either into joint-stock companies, or into state ownership, does not do away with the capitalistic nature of the productive forces.’ 

The state guarantees (including ownership in many cases) of the financial system after the financial crash in 2008 illustrated almost perfectly the growing role of the state in supporting the whole constitution of the existing mode of production.  The world-wide assumption of guarantees of employment and business survival during the Covid-19 pandemic has confirmed this.  It is unfortunate that rather than highlight this, much of the left has called for even greater state intervention, further sowing illusions in its potentially progressive role.

So, if Engels made it clear that capitalist state ownership is not socialism, a second question was nevertheless raised: is ownership by a workers’ state socialist even if ownership by the capitalist state is not?

Engels says: ‘Whilst the capitalist mode of production more and more completely transforms the great majority of the population into proletarians, it creates the power which, under penalty of its own destruction, is forced to accomplish this revolution. Whilst it forces on more and more of the transformation of the vast means of production, already socialized, into State property, it shows itself the way to accomplishing this revolution. The proletariat seizes political power and turns the means of production into State property.’

So, it would appear that the seizure of the means of production by the workers’ state constitutes the decisive opening of the road to socialism, and some form of state socialism may indeed be the genuine article. (Although the wording here is rather peculiar, for while capitalism more and more transforms the ‘vast means of production . . . into state property’ the proletariat through its revolution is to turn it ‘into state property’–to complete the transformation?)

Except Engels immediately goes on to say this:         

‘But, in doing this, it abolishes itself as proletariat, abolishes all class distinction and class antagonisms, abolishes also the State as State. Society, thus far, based upon class antagonisms, had need of the State. That is, of an organization of the particular class which was, pro tempore, the exploiting class, an organization for the purpose of preventing any interference from without with the existing conditions of production, and, therefore, especially, for the purpose of forcibly keeping the exploited classes in the condition of oppression corresponding with the given mode of production (slavery, serfdom, wage-labour).’

‘The State was the official representative of society as a whole; the gathering of it together into a visible embodiment. But, it was this only in so far as it was the State of that class which itself represented, for the time being, society as a whole: in ancient times, the State of slave-owning citizens; in the Middle Ages, the feudal lords; in our own times, the bourgeoisie.’

‘When, at last, it becomes the real representative of the whole of society, it renders itself unnecessary. As soon as there is no longer any social class to be held in subjection; as soon as class rule, and the individual struggle for existence based upon our present anarchy in production, with the collisions and excesses arising from these, are removed, nothing more remains to be repressed, and a special repressive force, a State, is no longer necessary. The first act by virtue of which the State really constitutes itself the representative of the whole of society — the taking possession of the means of production in the name of society — this is, at the same time, its last independent act as a State.’

‘State interference in social relations becomes, in one domain after another, superfluous, and then dies out of itself; the government of persons is replaced by the administration of things, and by the conduct of processes of production. The State is not “abolished”. It dies out.  This gives the measure of the value of the phrase: “a free State”, both as to its justifiable use at times by agitators, and as to its ultimate scientific inefficiency; and also of the demands of the so-called anarchists for the abolition of the State out of hand.’

How do we avoid the conclusion that what is being proposed is that upon the socialist political revolution the new workers’ state that has gained ownership and control of the means of production through that revolution begins to disappear?  Does this mean workers should struggle to enormously expand the power and scope of the state only in order for it to then more or less rapidly shrink and disappear?

To jump straight to a conclusion–the alternative is not to demand state ownership under capitalism, or to seek it under a workers’ state, but to struggle for workers’ ownership, that is for cooperative production by the working class and this ownership and control to encompass the whole economy.

It is the workers organised as producers that represents ‘society as a whole’, as required by Engels, and which can ‘openly and directly take possession’ of the productive forces and manage them, not any sort of state.  Even a democratic workers’ state is an organised body of repression separate from the working class; any other definition simply mistakes what a state is.  Whatever legal and administrative arrangements required to maintain the collective ownership of individual productive forces will either require a minimal role for the state or none at all, e.g. to prevent the alienation of particular productive forces owned by the class as a whole.

Capitalism has so developed the intellectual and social powers of the working class that it can direct the economy without capitalists; provided we do not stupidly restrict definition of the working class in such a way that it excludes its most educated layers, for example because they are normally significantly better off in terms of income than many other workers.

If we read Engels he speaks of ‘the State of that class which itself represented, for the time being, society as a whole: in ancient times, the State of slave-owning citizens; in the Middle Ages, the feudal lords; in our own times, the bourgeoisie.’

In each case the state represented those classes that owned and controlled the means of production (at least of the social surplus), so that the capitalist state defends the ownership of the means of production by the capitalist class.  The analogous role of the workers’ state is not to direct and manage its own ownership of the means of production but to defend the ownership by the working class of the means of production.

Only upon these grounds can the class nature of society be radically changed such that, as Engels argued, the working class abolishes itself and all classes and in so doing abolishes the state.  It makes no sense to believe that the state through its ownership of the forces of production will employ its political power to abolish itself, including its direction of society’s productive powers.

Socialism is not the granting of the productive powers of society to the working class by any sort of benevolent state.  In Engels terms, the workers’ state can more and more be the representative of society under socialism to the extent that it disappears, reflecting the disappearance of classes themselves.

The socialist political revolution is the capture of political power by the working class in order to defend, and to extend, its social gains as the rising class in society, with its own ownership and control of society’s productive powers central to this.  The struggle for workers’ cooperatives is the most direct way to make this a reality under capitalism, as both ideological and practical example of the power of the working class to create a new society.

Such a view is consistent with the other expressed views of Marx and Engels, including ‘seizing the means of production by society’, which we shall review in the next post.

Back to part 43

Forward to part 45

Socialism from the State

Karl Marx’s alternative to capitalism part 43

Most organisations declaring themselves to be Marxist offer little or no role to the development of worker cooperatives as part of their programme. In one sense this is surprising given the striking declarations of Marx on their importance.  In another way it is not so unexpected.

The road to socialism was much debated in the 19th century with a number of currents putting forward a leading role for the state, including in sponsoring cooperatives.  Since that time the state has grown enormously, including for reasons that Marx and Engels set out. Its  prominence has often been obvious in less developed capitalisms where its role in industrialisation has been more direct from the start of its development.

The misplaced role for the state now current among socialists (nationalisation, income redistribution, state welfare etc.) arises as a reflection in ideology of the massively increased economic and social power of the state within capitalism, and the weight of that ideology transmitted into Marxism through social democracy and Stalinism.  All these have been too powerful in their effect on weak Marxist currents.  When we appreciate the ideological influence of the Russian revolution, the dominance of the idea of socialism as an expression of state power is unsurprising.

For this reason, it is important in setting out Marx’s alternative to capitalism to address not only what he positively advocated but also what he fought against, and one of his recurring battles was against the idea of some of his contemporaries that socialism would issue from the state.  Against this he also had to address the views of anarchism, which argued that the state could quickly be abolished.

Given the hold that this ‘state socialism’ continues to have on a wide variety of socialist and generally ‘left’ opinion, it is therefore necessary to set out Marx and Engels’ views on the role of the state in the creation of socialism.  In doing so we will leave aside the actual experience of attempts to implement such a view in the 20th century and will come back to some aspects of these in future posts.

As we have seen, the development of the socialisation of production lays the grounds for collective ownership of the means of production by the working class.  This socialisation is expressed through the development of joint stock companies, workers cooperatives and state ownership, following the concentration and centralisation of capital.

Capitalism is therefore a transitional form to socialism but it is necessary to understand the forms of this transition and their unfolding.  It is therefore not the case that because state ownership is one of the most developed forms of capitalism, and therefore of transition, it is by this fact also an early form of socialism.

In ‘Socialism: Utopian and Scientific’ Frederick Engels sums up the historical evolution of capitalism – from medieval society to capitalism – and the contradictions that lead to proletarian revolution:

‘Partial recognition of the social character of the productive forces forced upon the capitalists themselves. Taking over of the great institutions for production and communication, first by joint-stock companies, later on by trusts, then by the State. The bourgeoisie demonstrated to be a superfluous class. All its social functions are now performed by salaried employees.‘

Proletarian Revolution — Solution of the contradictions. The proletariat seizes the public power, and by means of this transforms the socialised means of production, slipping from the hands of the bourgeoisie, into public property. By this act, the proletariat frees the means of production from the character of capital they have thus far borne, and gives their socialised character complete freedom to work itself out. Socialised production upon a predetermined plan becomes henceforth possible. The development of production makes the existence of different classes of society thenceforth an anachronism. In proportion as anarchy in social production vanishes, the political authority of the State dies out.’

This formulation leaves open the view that seizure of the mean of production by the state – once itself seized by the working class – removes them as forms of capital, becomes the form of socialisation under the rule of the working class, and initiates their employment as means of satisfying the needs of the vast majority of society.  The same proposition appears in Anti-Duhring, from which the short pamphlet is derived.

In an earlier section of  ‘Socialism: Utopian and Scientific’ Engels addresses the Marxist view of the state in the transition to socialism by noting the planning that is involved in the development of Trusts and monopoly:

‘. . . with trusts or without, the official representative of capitalist society — the state — will ultimately have to undertake the direction of production. [4] This necessity for conversion into State property is felt first in the great institutions for intercourse and communication — the post office, the telegraphs, the railways.’

In the footnote within this passage Engels states that:

‘4. I say “have to”. For only when the means of production and distribution have actually outgrown the form of management by joint- stock companies, and when, therefore, the taking them over by the State has become economically inevitable, only then — even if it is the State of today that effects this — is there an economic advance, the attainment of another step preliminary to the taking over of all productive forces by society itself.’

‘But of late, since Bismarck went in for State-ownership of industrial establishments, a kind of spurious Socialism has arisen, degenerating, now and again, into something of flunkyism, that without more ado declares all State-ownership, even of the Bismarkian sort, to be socialistic. Certainly, if the taking over by the State of the tobacco industry is socialistic, then Napoleon and Metternich must be numbered among the founders of Socialism.’

‘If the Belgian State, for quite ordinary political and financial reasons, itself constructed its chief railway lines; if Bismarck, not under any economic compulsion, took over for the State the chief Prussian lines, simply to be the better able to have them in hand in case of war, to bring up the railway employees as voting cattle for the Government, and especially to create for himself a new source of income independent of parliamentary votes — this was, in no sense, a socialistic measure, directly or indirectly, consciously or unconsciously. Otherwise, the Royal Maritime Company, the Royal porcelain manufacture, and even the regimental tailor of the army would also be socialistic institutions, or even, as was seriously proposed by a sly dog in Frederick William III’s reign, the taking over by the State of the brothels.’

This footnote makes clear that Engels did not regard ownership by the capitalist state, often now euphemistically called public ownership, to be any sort of socialism.  As he goes on to say in the main body of the text:

‘But, the transformation — either into joint-stock companies and trusts, or into State-ownership — does not do away with the capitalistic nature of the productive forces. In the joint-stock companies and trusts, this is obvious. And the modern State, again, is only the organization that bourgeois society takes on in order to support the external conditions of the capitalist mode of production against the encroachments as well of the workers as of individual capitalists.’

‘The modern state, no matter what its form, is essentially a capitalist machine — the state of the capitalists, the ideal personification of the total national capital. The more it proceeds to the taking over of productive forces, the more does it actually become the national capitalist, the more citizens does it exploit. The workers remain wage-workers — proletarians. The capitalist relation is not done away with. It is, rather, brought to a head. But, brought to a head, it topples over. State-ownership of the productive forces is not the solution of the conflict, but concealed within it are the technical conditions that form the elements of that solution.’

He goes on to say that ‘This solution can only consist in the practical recognition of the social nature of the modern forces of production, and therefore in the harmonising with the socialised character of the means of production. And this can only come about by society openly and directly taking possession of the productive forces which have outgrown all control, except that of society as a whole.’

This ‘open and direct’ taking into possession cannot be by the state since this is a separate machine apart from the class.  Engels follows up the above remarks by stating that the productive forces that ‘work in spite of us, in opposition to us, so long they master us . . .  when once their nature is understood, they can, in the hands of the producers working together, be transformed from master demons into willing servants.’

The tendency for the state to more and more take over production is therefore posited as the dynamic development of capitalism and not of society ruled by the working class.  The state is not the true representative of society, a point made very early in Marx’s political development, and is as Engels says: ‘essentially a capitalist machine, the state of the capitalists, the ideal personification of the total national capital.’

So, if capitalist state ownership does not mean socialism, what does it mean for ‘society openly and directly taking possession of the productive forces’, a phrase repeated by Engels a number of times.  How is to be done and once done does ownership by the new workers’ state mean socialism?

Back to part 42

Forward to part 44

Karl Marx’s alternative to capitalism part 30 – base and superstructure 3

In the last post I noted the view that change in the material base of society, its forces and relations of production, cannot be viewed as a result simply of superstructural change, i.e. a change in the nature of the state.

There is an additional reason why this is the case.  This is because the state is not simply a superstructural phenomenon.

At first sight this might seem to invalidate the first criticism – that the state cannot be the agent of changing the material base of the forces and relations of production because it is purely a superstructural phenomenon.

The state is central to constituting and reproducing capitalism both in its economic role of direct state production and also in the many roles that involve supporting private capital accumulation. It is for example, vital to the reproduction of labour power through the provision of health, education and social services in addition to direct involvement in industries typically carried out by private capital, such as energy.

More generally it is also necessary for the reproduction of the legal framework within which capitalism operates – property law, contract law and the employment of an apparatus that enforces these through courts, police, regulatory bodies and inspectors etc.

The state encompasses economic and social tasks as well as the tasks of defending the existing relations of production through its laws, courts, judiciary, executive and legislative bodies, police and armed organisations.  Marxists propose the destruction of these but not the services the state otherwise provides such as health, education and social services.

But are these to continue to operate in the same way after a genuine socialist revolution, with only the purely political aspects of the state democratised?  The traditional Marxist view is that these political aspects – parliament, local government, quangos etc. are not to be democratised but replaced – by workers councils or other workers’ delegate or representative structures.  So what about direct state industry and services?

Marx’s answer would be to ask why these should be provided by the state at all?

As I have argued before, state ownership is not socialism and many of the tasks currently carried out by the state today would not be carried out by the state in a society arising from working class emancipation.  The provision of education, health and social services would not be carried out by the state but by the workers involved in delivering these services alongside those in receipt of them.

So not only is state ownership not a model of socialism within capitalism today; state ownership would not be a model of socialism so tomorrow.  It would not constitute socialism – the direct rule of the working class.  In such a worker-governed society these services would not be under the direction of the state’s bureaucracy and its executive.

By definition the state is a body standing separate and above society, at least partially insulated from its demands and requirements. None of these services should be in such a position, legally or organisationally.  They are part of the structure of society, of its forces and relations of production, as much a part of society’s productive powers as any other, consisting of production and services that should be provided by and for the working class itself.

It is only the incapacity of capitalism to socialise them through anything other than state direction, or then damage them through outsourcing aspects to private capital, that leads many to believe that only the state can represent society as a whole and provide such services on behalf of all within it.

Marx’s analysis was that the state does not represent society as a whole.  In fact, its role in suppressing subordinate classes can be seen in how it provides all of its services, from health, education and welfare to policing and application of the law.

It is consciousness of the necessity for these services to be carried out by the workers themselves directly that requires the material development of workers’ cooperatives that anticipate and point the way forward to workers replacing the current relations of production, including state owned production.

The power of the state cannot be the means of changing the material base, the relations of production, because it is not the objective of this transformation to increase state power.  In other words, the state cannot change the relations of capitalist production to one upon which socialism can be constructed because state ownership itself is not socialism and workers direct management and control cannot be carried out through a separate body but only directly by workers themselves. That is the experience of the Soviet Union and all other experiences of state-led ‘socialism’, and in any case was Marx’s vision of socialism.

The view that smashing the repressive arms of the capitalist state while maintaining its control of the services it provides is therefore mistaken.  The view that it can leads to two further mistakes.

One is the emphasis often put on the new cooperative economy being a centrally planned one.  The second is the underestimation of the complexity of modern capitalism, what is involved in its operation and therefore required of any alternative.

Marx has been criticised many times for not leaving a blueprint of the new society and how it would work.  If he had thought that a state would be the basis of introducing and constituting a new socialist society, or its transitional proletarian dictatorship, then this would be a valid criticism.  But he didn’t, so it isn’t.

He did not envisage a state planning all production and did not consider this to be the foundation of human emancipation.  This is clear from his earliest writings, which makes identification of Marxism with state control wrong from the start.

For him the new workers’ society was not an ideal and therefore static state (in any sense of that word) but a movement which starts from workers’ cooperative production, with a state body to defend that production, and the increasing role of cooperation in allowing humanity to control its own material circumstances and thereby its own development.

This involves planning in the sense that conscious decision making takes the place of exploitation and alienation, with alienation arising from commodity production in which the success of commodities determines the lives of those who created them.

The role the market plays in this is one that will more and more come under such conscious direction, but on its own such markets do not constitute the continuation of capitalism, nor does their increased marginalisation necessarily constitute socialism.

The emphasis on smashing the state and its replacement as the vehicle for determining the new society, including its planned economy, also leads to a chronic underestimation of the complexity of modern capitalism and the idea that it can be controlled by a central mechanism.

This was true in Russia in 1917, including Lenin’s expectations, and is even more true now.  In fact, the complexity of society is one very important reason why those that construct and reproduce it, the working class, its highest paid members as well as its lowest – including what is often considered the middle class – are required directly and consciously to ensure that its reproduction provides for the welfare of the majority of its people rather than the gross and excessive consumption of a tiny elite.

Marx’s view of the state should be well known but the influence of the massive growth of the capitalist state on socialist thought (a real example of the power of the material base to determine the consciousness even of its enemies!) has been lost on many of his followers.

In his ‘Critique of the Gotha Programme” Marx said that:

“First of all, according to II, the German Workers’ party strives for “the free state”. Free state — what is this?”

“It is by no means the aim of the workers, who have got rid of the narrow mentality of humble subjects, to set the state free. In the German Empire, the “state” is almost as “free” as in Russia. Freedom consists in converting the state from an organ superimposed upon society into one completely subordinate to it; and today, too, the forms of state are more free or less free to the extent that they restrict the “freedom of the state”. “

“The German Workers’ party — at least if it adopts the program — shows that its socialist ideas are not even skin-deep; in that, instead of treating existing society (and this holds good for any future one) as the basis of the existing state (or of the future state in the case of future society), it treats the state rather as an independent entity that possesses its own intellectual, ethical, and libertarian bases.”

Back to part 29

Ireland – the Apple Republic part 2

apple-taxWhen a left wing TD called the decision of the Irish Government to appeal the decision that gives it €13+ billion “economic treason” against the Irish public he contributed nothing to clarifying for Irish workers the role of the state, which is precisely to defend big business against that part of the Irish public made up of workers, their families and small businesses, who mostly have little choice but to pay the state’s taxes.

Much better would be a socialist campaign to rally trade union branches, community groups, tenant associations, consumer groups and campaigns etc. to put together their own proposals as to how exactly the €13 billion should be spent.  The purpose would be to demonstrate that the needs of workers should come before those of multinationals and before the reputation and interests of the state and its ‘national interest’.  A campaign that sought to unite with the workers of other countries swindled out of tax receipts by Apple would go a long way to demonstrating that this is not about a race to the bottom that pits workers of one nationality against all others.

This would also allow working people to show, not least to themselves, that they can plan effectively how to spend the money, not just for their own benefit but in the interest of all working people. Its purpose would be to begin to instil a view within them that they should take control of society themselves rather than relying on the state to do the big things for them.

On this count the view expressed by another left wing TD was much closer to the mark.  Speaking in the Dáil Paul Murphy said: “Governments in capitalist societies are but committees of the rich to manage the affairs of the capitalist class. It is as simple as that …. All of the establishment parties represent the rich and the 1 per cent. We need to be rid of this committee of the rich, and we do not need it replaced with a reconfigured committee of the rich.”

The creation of a desire for, and mechanisms to achieve, an alternative to a “reconfigured committee of the rich” is precisely the objective of this proposal for working class activity.  Only by workers increasingly taking control over their lives now can we conceive an alternative that is real, compared to reliance on a state that always has your best interests as far away from its mind as possible.  The motto of socialists in this regard should be the famous quip of the British actor David Niven who, when speaking of Errol Flynn, once said “you always knew precisely where you stood with him because he always let you down.”[i]

A wider claim in relation to the Apple judgement and reaction to it is that such sharp practices are part and parcel of a policy of neoliberalism which is past its use by date.  The exhaustion of this policy has been expressed in the crisis of financialisation in 2008 and the failure of Eurozone austerity policies and similar policies in Britain, where their effects have not been quite so damning only to the extent that the Tories have failed to follow through fully on their austerity rhetoric.  In this view we will see a return to a class compromise that was supposedly the cornerstone of Keynesian policies practiced among the most developed countries after the Second World War.  Among these will be fair taxation of capital and the rich.

Against this it might be pointed out that the Apple ruling did not uphold any principle that taxes should be levied where real economic activity takes place and that in fact it was justified through an objection to state intervention, on the grounds of unfair state aid.

In 1997, even during the neoliberal era, EU Finance Ministers set up a Code of Conduct Group on business taxation that was charged with examining unfair tax practices and in succeeding years it abolished nearly 100 tax incentives across the EU.  Today it is the OECD which is supposed to be spearheading cooperation between governments on tax avoidance and evasion but this body has been a consistent supporter of neoliberalism.

In so far as there has been a trend in corporate taxation it has been a lowering of rates:

“Corporate tax is falling, both as a share of GDP and in the global tax take. . .  Within the last 20 years, corporate tax rates have fallen from around 45% to less than 30% on average in OECD countries. And lately, with increased mobility of multinational corporations, tax competition has intensified. Thus from 2000 to 2005, 24 out of the 30 OECD countries lowered their corporate tax rates while no member economy raised its rates.”

Closing or restricting some ‘loopholes’ is perfectly consistent with lowering rates because the loopholes become less and less relevant.  Reliance on the state to produce ‘fair’ taxation is like relying on Errol Flynn.  The Apple case, precisely because of its scale, is instructive in this and other respects.

The Left has pointed out the sheer scale of the windfall that the Irish Government is potentially spurning, pointing out its hypocrisy in demanding that the Irish people must do what the EU wants when it comes to austerity, bailing out the banks, ensuring no bond-holder is left behind and their demand that water charges simply must be paid.  When it comes to standing up for the Irish people no demand from the EU is too big but when it comes to standing up for the wealthiest multinationals no claim is too disreputable, no sacrifice too large and no neck so shiny and hard.

Commentators have pointed out that €13 billion would make up the budget for the health service for a year or it could take a significant chunk off the national debt of €200 billion.  It could pay the equivalent of a few years of the unpopular Universal Social Charge or it could mean a cash donation to everyone in the state of around €2,800 each, so that a household of four would get over €11,000.  A tidy sum for everyone in the State, or a significant boost to public services.

What it isn’t, despite its unprecedented size, is fundamental or transformative.  While it is a godsend of an example of taxing the rich, which much of the Left repeatedly presents as the answer to austerity and an exemplar of socialism, the Apple example shows that it is not.  Or not if one thinks of socialism as a fundamental change to society and a transformative change in working people’s lives.

What it is, is confirmation of the point made by Karl Marx many years ago, about the limits of distributing existing income or wealth, as opposed to changing the fundamentals of the ownership of productive resources that creates and recreates, again and again, this income and wealth.

“Any distribution whatever of the means of consumption is only a consequence of the distribution of the conditions of production themselves. The latter distribution, however, is a feature of the mode of production itself.

The capitalist mode of production, for example, rests on the fact that the material conditions of production are in the hands of nonworkers in the form of property in capital and land, while the masses are only owners of the personal condition of production, of labor power. If the elements of production are so distributed, then the present-day distribution of the means of consumption results automatically. If the material conditions of production are the co-operative property of the workers themselves, then there likewise results a distribution of the means of consumption different from the present one.

Vulgar socialism (and from it in turn a section of the democrats) has taken over from the bourgeois economists the consideration and treatment of distribution as independent of the mode of production and hence the presentation of socialism as turning principally on distribution. After the real relation has long been made clear, why retrogress again?”

This is the argument that goes to the root of the nonsense peddled by Michael Noonan that taxing Apple would mean “eating the seed potatoes” or Micheál Martin that “This model supports hundreds of thousands of jobs and pays for teachers, nurses and pensions in every part of our country.  What’s more, it has done so for decades.`’

Such is the significance of any battle over Apple’s taxes.  Reliance on multinational capital and all the crap that goes with it or a cooperative economy owned and controlled by workers not just in Ireland but everywhere.

[i] Of course the parallel isn’t exact – Niven and Flynn were “pals” while the working class and the capitalist state are enemies.  It is appropriate however that the above remark was made of an immature personal relationship that has no correspondence to the political stance workers must take against the state; even if failure to take such a stance reflects an undeveloped and therefore immature failure by some Irish socialists.

Back to part 1

Ireland – the Apple Republic part 1

apple_tax_european_union_sept022016The decision of the European Commission to require the Irish State to collect €13 billion in unpaid taxes, plus a potential €6 billion in interest, from US technology company Apple made headlines across the world.  Special tax arrangements, which appear not to have applied the State’s already low 12.5% corporate tax rate, led to an effective tax rate on Apple of 0.05% in 2011 and 0.005% in 2014.  Two tax rulings in 1991 and 2007 allowed an Irish company to book Apple sales across Europe, the Middle East, Africa and India in Ireland and attribute profit on these sales to a “head office” which was stateless, had no offices, had no employees and existed only on paper.

The Irish State has decided to appeal the ruling, as has Apple itself.  Apparently preventing the State from abjectly prostrating itself in front of Apple is an assault by the European Commission on the sovereignty of a small nation.  It supposedly calls into question Irish tax policy while the Government frantically claims that the ruling affects the arrangements of no other multinational.

The appeal is to protect Ireland’s reputation although being dragged kicking and screaming to apply your own laws without discrimination, while defending cheating other countries of tax revenue, is apparently good for it.  The appeal is to prove that the Irish State is not a tax haven although a tax rate of 0.005% would appear to be a decent definition of one and defending it would appear to be open acknowledgement of it.  The Irish Government seeks to defend its prerogative to set an (in)famous corporate tax rate of 12.5% but does so by defending a 0.005% rate.

€13 billion is a big number and is the biggest judgement in the history of EU competition law – the cumulative total of all EU cases involving repayment of illegal state subsidies over the past 15 years is less than €11 billion – and it has been imposed on Apple, the world’s biggest company by market capitalisation.

One explanation given for all this is that the Irish state is dominated by imperialism and plays its natural role as an obsequious supplicant to multinational capital.  This is ok as far as it goes but it doesn’t go far enough, either in explaining or in providing the grounds for an alternative.  If we start with the latter – an anti-imperialist struggle in Ireland to make the natural resources of Ireland the property of the Irish people isn’t a solution.

For a start, the main natural resource of Ireland is its people.  In fact the growth of technology, and companies like Apple, demonstrates that it is the knowledge and skills of workers which is the key to the most dynamic sectors of the economy.  So it is harnessing the power of workers that is the key to economic development in Ireland as elsewhere, not minerals under the earth or the factory building which house the most modern production.  The machines that power this production are obsolete within years; simple ownership of them does not guarantee the future unless workers not only own them but have the knowledge and capacity to continue to revolutionise their development.

Secondly an utterly subordinate role for Irish capitalism does not explain how it allowed itself to become the vehicle for depriving other European countries of tax revenue, which the EU ruling now gives the latter an avenue to pursue.  The ruling signals that although other EU states may not have liked the Irish State’s low corporate taxation regime, it was not such a problem if it remained relatively marginal.  After all, they’re all engaged in tax competition in one form or another as one facet of inter-state and inter-company rivalry.

The problem for the Irish is that they prostrate themselves disproportionately to the US, who don’t so much mind the role of Ireland as a tax haven since it is US tax rules which permit Ireland’s role of in tax avoidance and also still allows the US to take a cut if and when the profits are eventually repatriated, perhaps as a result of some tax amnesty.

The Irish State has thus put itself in the middle of a bigger competition between EU and US capital and however much it might be “closer to Boston than Berlin” and wallow in its generations of emigrant’s ties to the old sod, the Irish State is part of the EU.  Its facilitation of US companies through an effective tax haven can only be permitted so much success before the bureaucracy of the EU proto-state decided that it had gone too far.  The Irish are therefore not just functioning as a subordinate client to imperialism but play a particular role in inter-imperialist rivalry.

And it would be wrong to characterise this role as something anomalous to the normal functioning of capitalism.  Apple had over $215 billion in cash and assets sitting outside the US as of June this year, sitting there avoiding US taxation.  It has been estimated that this is only part of $1.4 trillion sitting offshore of the US, all avoiding tax and perhaps waiting for an amnesty and a nice big deal.

It has been estimated that about half of all lending and deposits originate in Offshore Financial Centres(OFCs), about half of which are also tax havens.  The Irish State comes in 9th on the list in terms of size of tax haven, behind the Cayman Islands, which is the largest, and Switzerland and the Netherlands, which are 7th and 8th respectively.  These OFCs account for receipt of about 30% of the world’s foreign direct investment and themselves originate a similar amount.

While the tax rulings in 1991 and 2007 were based on Apple’s proposals to the Irish State, there is nothing anomalous about this either.  The British ‘Guardian’ newspaper reported last Thursday that  “the government has effectively privatised tax policymaking and enforcement . . . a working group consisting entirely of representatives from GlaxoSmithKline, Rolls-Royce, Eisai pharmaceuticals, Syngenta, Shell, Dyson, Arm, KPMG, Vectura and AND Technology Research drafted what eventually became known as the Patent Box legislation. They secured a special tax concession worth over £1bn a year for large corporations.”

The EC ruling on Apple has been described as “a watershed” and liberal Irish commentators have argued that it’s a wake-up call – that the Irish State’s success, based on attracting multinationals through tax breaks, is not a strategy that will stand the test of time.  The Irish State and its apologists claim that their tax policy is actually an industrial policy, which should be regarded as a purely national issue, but if this were so then we would expect the Cayman Islands, the Bahamas and Jersey to be thriving centres of industrial production.  Their brass plate companies and those in Ireland shown how ridiculous this rebranding exercise really is.

Some states benefit from tax competition and some suffer losses.  The EU bureaucracy attempts to set rules that do not allow discrimination against European companies as if the European Union was one capitalist state, which it isn’t (yet).  The state aid case against the Irish State is not therefore a bolt from the blue.  Since 2000 there have been 400 state aid cases and 225 cases involving tax advantages across the EU.  The Irish State, as a fully paid up member of the EU, has approved European Commission investigation of the tax arrangements of fellow EU states.

In October last year the EC concluded that Luxembourg and the Netherlands had granted tax advantages to Fiat and Starbucks respectively and in January concluded the same in relation to Belgium’s treatment of at least 35 multinationals, mainly from the EU, amounting to €700 million that should be collected.  The EC is currently investigating Luxembourg and its relations with Amazon and McDonald’s.

Capitalist states therefore both cheat and enforce laws against cheating.  They both protect big business and tax it in order to pay for itself.  Mostly however they tax small businesses and workers to provide the services and infrastructure that allow society to operate and function, one that functions and operates according to the laws of capitalist accumulation.

Forward to part 2

Remembering the Rising part 3 – Who’s afraid of 1916?

easter 1There is a view of the world and its history that what matters most is not what it is or what it has been but how it is perceived and understood; first having recognised that the two are not the same.  There is a different view that the world may be misconceived and misunderstood but its true reality matters more and ‘will out’.  The misconceptions are themselves part of the real world and are themselves a reflection of it and often contain a grain or more of truth, while still being wrong.

We can thus learn and appreciate the Easter Rising in 1916 by looking at how it is variously understood.

In the January 15 copy of ‘The Irish News’ the Sinn Fein leader Martin McGuinness states:

“The Rising wasn’t simply a rebellion against British rule.  It was an insurrection against injustice, oppression and inequality.  It was a social as well as a political and national revolution.”

We have seen in the previous post that the Proclamation did not rail against imperial oppression and injustice but condemned British rule as illegitimate.  Its claims for equality were limited and were made in relation to the particular context of foreign fostered religious division.  The Proclamation does indeed talk of welfare and freedom and of the common good but it is the nation’s welfare and national freedom that is extoled and the common good is for the people to sacrifice themselves for. And even if these clear meanings are ignored there is no statement as to how any different sort of freedom, welfare or the common good can be defined and its promise made good.

The Proclamation is a nationalist declaration and did not and could not explain how it could deliver any promises that its readers may mistakenly or otherwise have read into it.  A century of national liberation struggles across the world against British and other colonial powers, often inspired by the Easter Rising, have failed to demonstrate how the most radical understandings of such promises, such as those stated by McGuinness,  can be made good by any sort of nationalism.

But perhaps McGuinness is claiming that the words of the Proclamation do not matter, it is the reality of the Rising that is important, although I doubt he would make such a claim.  So perhaps he is saying that there is more to the Rising than the Proclamation that the Proclamation did not announce.

So the Rising was indeed a political revolution and a national one in so far as its aims were concerned although, by deliberate design, not national in scope – there was to be no Rising in Ulster.   However it was not a social revolution; it certainly didn’t pretend to be a socialist revolution.  We know what one of them might look like because we saw one the year after in 1917. And it wasn’t a social revolution of the land question.  If anyone deserves credit for the revolution in the transfer of land ownership from largely alien landlords to native tenant farmers it is the British who must stand first in line.  It must be said that in this they were helped by the massive loss caused by the famine for which they should also stand first in line, and were subject to agrarian agitation to force them.

So even in three very short sentences that are easily passed over as received wisdom the understanding of Martin McGuinness is inaccurate, just as 100 years ago the British and many others were wrong to see the Easter Rising as a Sinn Fein rebellion.  Sinn Fein had nothing to do with it and the party was led by a man who was not in favour of a Republic.

Does it matter that McGuinness’s understanding is so wrong?  Such misconceptions have been legion. The embers of the Rising were still warm before it was widely condemned as a ‘German plot’, all the better to damn it as a disloyal stab in the back in the middle of a real war.  The fiftieth anniversary celebrations have been blamed by Unionists for sparking ‘the Troubles’ in Northern Ireland, absolving the demands of Ian Paisley that the Tricolour be removed from the Falls Road for the trouble that erupted there in 1966, and later unionist attempts to attack demonstrations for civil rights for the eruption of violence in 1968 and 1969.

So yes, getting history wrong does matter because it will not explain why the Troubles broke out in the North of Ireland and it doesn’t explain why the 1916 Rising failed to achieve a truly national revolution never mind a social revolution.  If we dispense with incorrect explanations of the world and its history we are much better placed to seek better ones and in doing so better able to understand what is happening today.

For many what has happened during the centenary celebrations today is an “Irish capitalist class .  . overcome with embarrassment and revulsion, forced to commemorate something they despise”, according to one left wing leaflet handed out at a meeting in Belfast a few weeks ago.

For another left wing author “the notion that Enda Kenny owes his position as Taoiseach to republican guerrillas who stormed the GPO is, to put it mildly, deeply unsettling.  The political elite is therefore  approaching the centenary commemorations of the rising with profoundly ambivalent feelings and not a little trepidation”.

Two other authors have written a short book, ‘Who’s afraid of the Easter Rising? 1919 – 2016’.  They note the opposition to the Rising from those who think Ireland could have won its independence without the violence unleashed in 1916 and who therefore condemn it for the example it set to later generations of violent republicans.  They also characterise the attitude of the Irish Government to the commemoration of the Rising as one of “bad faith.  They talk in doublespeak  and clichés. Their energy is not directed at genuinely exploring or celebrating the legacy of the Rising but rather in controlling it.” In this desire for control however they are hardly alone.

“This political class is embarrassed by 1916 but most are afraid to say so publically, hence they practice the politics of ambiguity and dishonest historical revisionism as a way of avoiding the truth and real debate.”

But if the Irish establishment has been variously “uncomfortable”, embarrassed”, “afraid” and “nervous” they hid it well during the commemoration and scored a significant success, all the more significant depending on how much they were exposed to the emotions attributed to them by some left wing authors.

Far from ambiguity they presented a coherent narrative – we commemorate those gallant men and women who gave us our freedom today, a freedom expressed by the existence and independence of the Irish State which put its back bone on display through the military parade of its armed forces.  This is the State to which we owe loyalty and we celebrate the foundational act of that state – the Easter 1916 Rising. No one among the broadest ranks of Irish nationalism seeks to attack the institutions of this State, not even ‘dissident’ republicanism centred the North.

Easter 3

The celebrations were therefore a celebration not only of the Rising but of the legitimacy of the State and its institutions.  The highlighting of descendants of the 1916 rebels and later revolutionary heroes in the parade of today’s Armed Forces on Easter Sunday and the reading out of the Proclamation by an officer of the Irish Army was a coherent message that there is only one legitimate Óglaigh na hÉireann.  Loyalty to the state is mandated by the sacrifice of the men and women of 1916 whose creation it is.

And is this not at least partly true?  And if it is not by any means the whole story are we not then into more ambiguous territory and far from a simple story of misappropriation of a risen people by an elite?  Or, recalling our first post on remembering 1916; were Cosgrave, Collins and de Valera etc. not part of this risen people or, recalling the second post, did the Proclamation not address itself to national freedom and not any wider set of promises?

It is not that the Irish establishment finds nothing in the history of the Rising that it finds objectionable.  Who does not?  But among the emotions listed above there has also been indifference in the past, in commemorating the Rising and, for example, in maintaining and giving access to the historical records upon which its story can more truthfully be told.  In 1971 Garrett Fitzgerald stated that “this country will look very odd indeed in international eyes if Britain continues to release information about Irish matters before we do – as has already happened.  We will have to stop being afraid of our own history.”  His view reversed the previous Fianna Fail view of the late 1960s that access to state papers could result in “injury . . . to national unity and harmony.”  Taoiseach Jack Lynch said that even if the British opened papers the Irish Government would not because it “might well stir domestic controversies that best lie buried.”

In any case attempts to emulate the rebellious attitude of 1916 will not depend on seeking to emulate the Volunteers of 1916 but will come from the nature of the oppression and exploitation faced today and more importantly by the goals and strategies that channel this rebelliousness.  This is what makes the release of historical state papers possible – the historical controversies they relate to are relevant but  will not of themselves stir struggle today and are not amenable to a simple repetition of rebellion – what for, by whom, with what objectives and for what alternative?

We are called upon to commemorate those who fought in 1916 and to remember the Proclamation of the Republic they fought for, but on what grounds are we called upon to remember?  Who is asking us to commemorate and do we celebrate the same thing if we do?  Does this now matter, for will there now be any future anniversary with such resonance?

Easter 2

Back to part 2

Forward to part 4

How left does a Left Government have to be?

AAAdownloadThe weakness of the left’s strategy is revealed in the proposals upon which they would proclaim their difference from Sinn Fein and their preference not to seek a common platform.  If we look at the Anti-austerity Alliance (AAA) proposals for the 2016 budget we can see this illustrated in a number of ways. The gap in the strategy of the Left, evidenced in the AAA proposals, therefore also raises the question of how left the policies of a Left government have to be.

But first there is the reluctance of the AAA to accept that there is an economic recovery and one that many have benefited from, if only to the extent that the cuts appear to have relented.  Of course, that the rich do best is a permanent result in capitalism.  The issue here is not that the rich do best but the view that “for us, for working class people, for the majority of young people, unemployed people, pensioners and small farmers – there is no recovery.”  (AAA)

But this isn’t true.  Unemployment has fallen, and not just as a result of emigration, and wages are beginning to rise again while taxes are no longer increasing as before.  These things matter to people and go some way to explaining why there will be no left Government elected in 2016.

Stating otherwise allows the opponents of socialism to claim that socialism is politics for the poorest only.  It sits comfortably in right-wing rhetoric that socialists are only interested in those at the very bottom of society as opposed to better off or better placed workers.  It makes poverty the issue rather than the class inequalities and class divide in society.  It does not make one more of a socialist, or revolutionary, to deny that capitalism can improve the living standards of workers in particular ways, within particular limits and with regular crises that threaten the lifestyle that workers have slowly tried to create for themselves.

Worst of all, it fits with the view that socialism is created not out of the strength of the working class – that it has employment, that this employment is often skilled, that society is dependent on this skilled labour, that the working class is increasingly educated, and that it is not on desperation and oppression that socialism will be built but on hope, expectation and confidence of the working class in its potential power.

Above all, the unity of workers is based on shared interests regardless of more or less temporary differences in status and income.  The income inequalities within the working class are barriers to its political unity while the reformist emphasis on redistribution ignores what all workers share regardless of levels of income.

Poverty, unemployment and marginalisation are most important from a political point of view because they present barriers to a common class identity and unity.   Denying what little improvement there is robs whatever else is said by socialists of some credibility and it is not necessary to deny the growth of capitalism in order to argue for its greater failure and the need for an alternative.

When we move to the programme of the AAA the gap in the perspective of the left becomes apparent.  In proposals to repudiate the debt the case of Syriza’s attempt to renegotiate the Greek debt is recalled.  While it is proposed that “a left government in Ireland would demand a negotiated write-down of debt to a sustainable level” it is acknowledged that “if as the Greek experience indicates seems likely, it did not have success at the negotiating table, it (a left government) would then turn to the option of repudiation.”

The proposals state that this would involve an audit of the debt and that “it is reasonable to estimate that such a debt audit repudiation would result in a reduction of the total debt to at most 50% of GDP.”  The issues this proposal throw up – of opposition by the EU and of private capitalist measures that would be taken in retaliation, in other words of everything that makes this option a challenge, is unexplained.  The unwillingness to state how this would be successfully implemented and the opposition to it defeated hides an inability to explain how it could be carried out.

No amount of rhetoric will hide the failure to explain what needs to be done to implement the policy.  In a previous post I have looked at the lessons that the Greek experience might teach us, which elicited some discussion, but none of the potential lessons touched upon there are presented in the proposals of the Anti-Austerity Alliance.   Unfortunately problems are not overcome by ignoring them.

A second area in which purely reformist perspectives are evident is in the proposals for ‘Public Investment, Jobs and Decent Work’.  Here it is argued that “the state should not only be willing to employ people in public services, but rather should also invest and create jobs in “wealth creating’ sectors of the economy – construction, communications, natural resources.”

This proposal cannot be confused with the demand for employment presented in the Transitional Programme written by Leon Trotsky, which was written to “deal with the present catastrophic period” and which was not a perspective for long term development of the (capitalist) economy.  It was required in order to protect the working class “under the menace of its own disintegration.”  Its purpose was not primarily to protect living standards or to provide a long-term solution to the ravages of unemployment but was necessary because “the proletariat cannot permit the transformation of an increasing section of the workers into chronically unemployed paupers, living off the slops of a crumbling society. . . Trade unions and other mass organizations should bind the workers and the unemployed together in the solidarity of mutual responsibility.”  Its purpose was plainly mainly a political one, to put the workers in a better position to take over society, not to confuse such measures with socialism itself.

The proposal is mistaken not only on the grounds of principle, that it proposes, and expects, that the capitalist state  could “provide the investment necessary for the creation of a an economically and environmentally sustainable recovery”, in other words a more efficient and effective capitalism, but that its proposals are concentrated on development of infrastructure that private capitalism has been so bad at providing almost everywhere and on which it has often relied on the capitalist state to provide.  In other words state investment in infrastructure is complementary to private capitalism not a competitor to it, even if state ownership in itself could be so considered, which it can’t.

The specific proposals for investment make this clear, mostly directed to traditional state sectors – a public works programme based on the water and sewerage industries, healthcare and education; childcare and development of wind energy.  All are complementary to existing private capitalist accumulation and are supportive of it.  Even development of the wind industry is already well established and already has state companies at its core – ESB and EirGrid.

The most dynamic industries situated in Ireland are in the ICT and chemicals sectors (including pharmaceuticals).  Encouraging the setting up of workers cooperatives in these would signal a real appreciation of the possibility of a workers’ owned cooperative sector of the economy growing in competition with the private capitalist sector, laying the basis of a future economy totally based on cooperative principles.   But there is no evidence that this has been considered at all.

Finally, the AAA proposes not to raise the corporation tax rate but simply asks that the headline rate of 12.5 per cent becomes the effective rate.  It is obviously aware of the timidity of its approach despite saying that: “by maintaining a regime of low effective corporation tax to entice foreign multinational companies, Irish society pays a heavy price by depriving our wrecked public services of the funds they require to provide decent living conditions for all.”

Given its view of the paramount need to redistribute income from the richest corporations to workers it makes little sense to propose that these corporations incur a tax rate of 12.5 per cent while the lowest income tax rate for workers is 20 per cent (excluding the universal social charge).  The reluctance to even make them equal arises from the knowledge that such a rate would not be considered credible.  The AAA is unable to rebut the claims of establishment society that low corporate taxation is essential for the State’s economic sustainability:

“If it is truly the case – as claimed by the entire political establishment (as well as Sinn Féin, who support not only maintaining corporation tax at its current levels but extending that rate into the North) – that the slightest rise in effective corporation tax, to say fund the expansion our healthcare system and end the scandal of homelessness, would lead to a flight of companies out of Ireland then that is an indictment of their system, not a mark of economic irresponsibility on the part of the Anti-Austerity Alliance.”

So despite stating that “it is not simply a matter of tweaking with elements of the system here and there”; that a “rupture is needed”; “rules must be broken” and “a fundamental transformation of our society  . . needed”, it becomes clear that this rupture lacks foundation, except as a generalised declaration of the existence already of “the wealth and resources . . to deal with all the ongoing problems of the crisis”.

The calls for a “move to a socialist economy, with public ownership of the key sources of wealth, under democratic control of working people, and planned in the interests of the majority”, like the AAA “indictment of their system”, becomes a moral condemnation separated from a programme to achieve the goals desired.

If the AAA cannot have the confidence that multinational capital will not up-sticks and leave upon increased corporate taxes, never mind actively seek to sabotage a left Government’s plans, then what confidence can workers have?  More importantly – what will give workers this confidence to take steps to tax the rich, tax the corporations and slash corporate welfare?  The AAA itself admits that: “as was unfortunately demonstrated in Greece, the wealthy are unreconciled as a class of people to any encroachment on their privilege. . . . the rich . . . will attempt to do whatever it takes to avoid paying for the crisis in their system.”

Unfortunately the AAA comes nowhere near explaining just what “whatever it takes” means, or whatever it takes would mean for the working class to defeat this capitalist resistance.  A radical left Government that truly sought to introduce a socialist society could not do whatever it takes, and this wouldn’t be mainly because of the opposition of capitalism, but because socialism can only be the creation of the working class itself, not a left government sitting atop a capitalist state.  If multinational capital struck against a radical Irish state this state is not capable of taking over the production vacated even if it were able to sell internationally what it produced.

This demonstrates in a very practical way how reformist notions of a state-led transformation of capitalism into socialism cannot work.  Only working people themselves can take over production and organise it on a cooperative basis.  Only workers can implement a radical restructuring and development of a cooperative economy and only they can replace, if necessary, the production vacated by fleeing multinationals.  That no significant section of Irish workers sees this as a possibility, as a mission, is why they buy into the fear that to challenge multinational capital too hard would only invite a retaliation they would be unable to cope with.

All this is why the creation of workers’ cooperatives is so necessary – in order to establish in the minds of workers the realisation that they can own and control production themselves; that they can create their own firms, provide their own jobs, develop their own products and markets, and impose their own discipline in the workplace.  On such a basis the failure of capitalist production will more and more witness a successful rival that, as the cooperative sector grows, would provide a potential alternative to it, one based on more than simple propaganda or agitation.

This alternative would involve the realisation of workers that their future lies not in sacrifices for the capitalist system but the development of their own cooperative sector to cover the whole of production.  In this rival sector of working class power all firms would be under the ownership and control of their workforce, all jobs their creation and all products those that workers see a genuine need for.  Within this sector of the economy their own discipline would determine the relations of power which would more and more come into conflict with the relations of power across the rest of society.  Such an exercise of power would see them shed illusions in the neutral role of the state and would see them stop looking to the state as the solution to all their problems – a state that they can never control and that can never reflect their interests or will.

Unfortunately the AAA like many others present the state very differently, as all its proposals demonstrate.  I will not dwell here on whether its devotion to the capitalist state as the vehicle for socialist transformation is a result of electoralism, which posits a left government at the top of the state as the key task, or whether worship of the transformative power of the state makes pursuit of a left Government the only rational objective.  But even the AAA sometimes can’t help expose the contradictions in its whole approach, as when it states that: “the contrast between the state’s efforts to publicise its corporate welfare schemes and its miserly approach to social welfare claimants could not be starker, or more revealing of the capitalist interests the state exists to serve.”

So if the state exists to serve capitalist interests why would it tax a resistant capitalist class, provide jobs for workers and strengthen their bargaining power; attack corporate welfare; countenance the replacement of private capitalist investment for its own and agree to a programme that clams will lead to socialism?

Perhaps some defence of the AAA proposals is possible by recalling its statement that “the purpose of the Anti-Austerity Alliance budget statement is to give an illustration of how things could be organised differently – how the wealth exists to provide decent living standards for all.” Except that what it holds up is more than an illustration but is proposed as an important step on the road to a socialist society.  Of course socialists should not oppose the measure proposed by the Anti-Austerity Alliance but only because their implementation, even partially, would make taking the right steps on the right road to working class power easier.

One purpose of the examination of the AAA proposals has been to demonstrate that the conception of change held by the left is not so very different from that of Sinn Fein; one based on state led economic development directed by a left Government with popular support.  In the next post I will look at further proposals to separate the left from the Sinn Fein by People before Profit and what approaches the Socialist Party and the Socialist Workers Party have for dealing with the situation after the election when there will not be the left Government they seek.

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The gap in the strategy of a Left Government

ireland IT map-480x360In the first part of this post on a left Government I stated that I did not believe that it was going to happen in the coming elections and also that this left a strategic gap in the perspectives of the left.  The fixation on electoral intervention and its potential success are therefore misplaced.    I have argued many times before in this blog that the reformist politics of the Left is inadequate to the objectives it professes to advance.

The focus on achieving a left government as the key to fighting austerity, and implementing policies that would mean a fairer capitalism, are misguided and bound for ultimate disappointment.  To put the argument at a very summary level: they fail to target the foundations of the capitalist system and avoid what is the root of the working class alternative.  The foundation of capitalism is the ownership of the means of producing everything we consume and rely upon for a remotely civilised existence by a separate class of capitalists and the resulting necessity of the working class to sell their labour power in order to earn the money to live. Workers do not own the product of their labour because it belongs to those who also own the means of production.

This is ABC for Marxists but unfortunately it is not carried forward to argue that the means of production should belong to the workers and thus support for measures that lead to this workers’ ownership of production, such as the formation of workers’ cooperatives.  Instead the Left argues for increased state ownership and argues that democratic control of the state and/or workers’ control under state ownership makes their programme different from the frequently employed policy of capitalist nationalisation.  I have argued differently here and here.  I have also addressed some arguments against workers’ cooperatives that are often advanced by the left here and here.

The Left’s alibi is that a revolution will accomplish the necessary transfer of property ownership, although this ignores a lesson of the Russian revolution that state ownership of property is not the same as workers’ ownership.  It also leaves the idea of a revolutionary approach, not as something that can grow today (before culminating in a transfer of power through creation of a new workers’ state after the capitalist one has been destroyed) but as something for the future, between now and which all sorts of very non-revolutionary methods are acceptable, if sometimes not actually desirable.

Because such non-revolutionary approaches are not in themselves fundamentally different from more or less radical alternatives that seek to reform capitalism a problem arises in distinguishing the proposals of the left parties from those of parties that do not seek to break from capitalism, such as left liberals or in Ireland – Sinn Fein.  As I have argued, this also leaves a strategic gap in perspectives aimed at fundamental transformation of society.

Again to summarise: without adequate preparation and prior strengthening of the working class through building strong trade unions, parties and workers’ cooperatives the fundamental break from the  diktats of capitalism becomes much harder and workers themselves,  as witnessed recently in Greece for example, are unwilling to consider a revolutionary leap.

Strengthening of the state, through state ownership and growing its power by increased taxation and spending does not increase the power of the working class but often leads to increased working class dependency on it.  Such dependency is something that should be argued against, not encouraged either directly or indirectly.  Workers doing it for themselves should be the maxim, not least because state initiatives proposed by the left are almost always national ones that are at best nationalist solutions.  It’s why nationalisation is nation-alisation.

Capitalist state ownership is not socialism and democratising the state does not make it socialist.

On practical grounds the reform of capitalism is easier to consider and to implement when the particular capitalist state is both strong economically and has greater political and social capacity to mobilise and organise wider society.  The relatively weak fundamentals of the native Irish economy reproduced also in the machinery of the Irish state, reflected in its endemic corruption and lack of developmental capacity, make the reformist development of a strong reforming state and dynamic economy less credible and more difficult to achieve.

This was the fundamental problem facing Syriza in Greece when it sought to confront the demands of the European Union led by Germany.  There was no strong Greek capitalism that it could rely upon both to increase the costs to the EU of any measures it might take against Greece or strong economic base on which to venture an alternative international economic strategy outside the EU.   This weakness of Greek capitalism is reflected in Greek consciousness through support for the Euro even while this was portrayed by many as the source of its disaster.

images (12)Similarly in Ireland the weakness of Irish capitalism is reflected in Irish workers acceptance of sycophantic policies towards the richest global corporations while suffering austerity themselves.  It is why the ability of the Irish State to set a low corporation tax and defend this policy against other countries’ opposition is held up as the peak of Irish sovereignty and is by and large accepted as such.

The latter view is in turn reflected in the policies of the left, which proposes not to raise the corporation tax rate but simply ask that the headline rate becomes the effective rate.  The existing rate of 12.5% thus lies below the rate of corporation tax that Thatcher found acceptable in Britain – when she resigned it was well over 30 per cent.  Such modesty must have an explanation.

This is only one aspect of the various proposals of the Left to increase state intervention which, of necessity, take into account the capacity of the capitalist economy to deliver.  We will see this again and again in the next post.

Finally, the necessity for international working class action to achieve socialism is clear when it is appreciated that a radicalised Irish state, even if it was not socialist, would be in a very weak position set against the ranks of the British State, its historic oppressors, occupiers of part of its territory; the European Union and its control of the currency; and the US, not least through its multinationals.  It is well known that the US, in the person of its treasury secretary Timothy Geithner, vetoed haircuts to senior bondholders of the insolvent Irish banks, which would have hugely reduced the burden on Irish workers.

It hardly needs saying that in a socialist society international economic links with the rest of the world will increase and so dependency on the outside world will also increase.  A hostile capitalist world would not see a radical Irish state survive in its radical state very long.

The left’s approach leaves a strategic gap which even the existence of a left Government does not fill because it is not a answer to these problems.  The gap is further evident in the separation (or lack of it) of the left’s proposals from that of non-anti-capitalist forces such as Sinn Fein.  As I have said, fundamentally the difference in proposals between the Left and Sinn Fein is one of degree and not fundamental.  This does not make the differences unimportant but it is not the difference between socialism and ‘progressive’ capitalism.

to be continued

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