A Reply To Charlie On The State

This post is a reply to Charlie Mc Menamin’s comments on my post In And Against The State.

Charlie, I have to say that I thought the argument you presented – though you are far from being alone in presenting such an argument – is very, very odd. Rather than have to post several comments, to get around the annoying word limit for comments, I thought it would be easier to reply via a separate post.

You argue that the State is different from other Capitalist enterprises because it provides services – such as Healthcare, Education, Social Care – which,

“has offered real benefits to the mass of ordinary people for at least three or four generations”.

Now, I do not dispute that it has provided these things, nor do I dispute that these things have been of real benefit to workers, but my question is, how on Earth is this different to any other fraction of Capital???? Are you suggesting that workers have not had real benefits, for example, from the food provided by agricultural Capital? Have workers not benefited from the clothes provided by Textile Capital, or the shelter provided by Construction Capital??? Have these not been real benefits enjoyed by workers for far more than three or four generations?

In fact, have THESE Benefits of Capitalist production not been MORE significant than the goods and services provided by the State Capitalist? After all, millions of people have, and in parts of the world continue, to live for a long time without Education, Health or Social Care, but very few people, anywhere or at any time, live for very long without food, shelter, and clothing!

If we continue the comparison of goods and services provided by the State Capitalist with those provided by other fractions of Capital, things do not get better. A couple of years ago, I bought a new car. Having compared the alternatives, I settled on a particular make and model. I handed over my money, and got what I paid for. Had their been a problem, I have legal rights, which can be enforced, to obtain a remedy. In fact, rarely, is it necessary to resort to such measures, because competition between suppliers tends to ensure that they respond to any such complaints by remedying the problem quickly. In fact, 35 years ago when I worked for Royal Doulton, which at the time alongside Wedgwood, was an oligopolist supplier of china in the British market, I was responsible for dealing with customer complaints. It was company policy to simply replace anything sent back to us whether it was faulty or not.

How does this experience of obtaining goods and services from private Capital compare with the experience of obtaining goods and services from the State Monopoly Capitalist? We only have to ask the question to know the answer, or we could turn to your own latest blog post Thoughts On Spending 31 Hours In A&E With An 87 Year Old, which details your experience of the inefficiency, and inadequacy of the Health Care provided by the NHS, an experience shared regularly by millions of workers! If, that had been you buying a car, you would have told the dealer to stick it, and would have gone to some other dealer where your custom was more prized! Yet, in something more important than buying a car – our healthcare – we simply suck it up, and complain, because the provider is the State!!

And, as I set out in my blog, Cut & Run , for much of the twentieth century, millions of workers paid for a service – A State Pension – which the State never provided for them, because they died before they became entitled! If I pay the agreed price for a car, or any other commodity from a supplier, I do not expect there to be any question about whether the supplier will actually supply the goods or not! Yet, as you have stated yourself from your own experience of dealing with the State on behalf of voluntary organisations, there is no such guarantee that the State will provide what it has contracted to provide, and very little recourse when it does break such a contract. The current example, of pensions is a prime example. Having persuaded workers to part with large amounts of money over decades in return for the promise to provide a service – a State pension – the State reneges on that contract, because it believes that with workers living longer it might actually have had to fulfil its obligations under that contract. So, it unilaterally changes the terms of the service it provides, cutting the payments, and delaying the time at which it becomes payable!

Similarly, workers have contracted to get decent healthcare, and have handed over vast sums of money for it in return. But, what do they get back? Despite the good intentions and aspirations of the millions of workers involved in providing the service, 31 hour waits, often dirty facilities where patients stand a good chance of dying from MRSA, or C-Diff, and until recently, and, after 60 years of such huge payments by workers for this service, very, very old and inadequate buildings.

No, here too the provision by the collective Capitalist compares badly with the provision of goods and services by other fractions of Capital. I can think of very, very few occasions when workers have had to take to the streets to demand that private Capital actually provides the goods and services that workers have contracted to buy. Yet, such demonstrations such struggles “Against” the State are frequent and recurring, just to demand it provides what it is contracted to supply. If the collective State Capitalist is different to other fractions of Capital it is in this – where workers only struggle against private Capital as producers, against the State Capitalist workers have to struggle against it not just as workers within it, but as consumers of its services, just to get it to provide what they have paid for! To me that does not put the State Capitalist in a more favourable position when compared with private Capital.

Furthermore, the car I bought is better in many ways from the new car I bought seven years earlier. There had to be no huge mobilisation of workers on the streets, no industrial action to force the car makers to bring about this improvement. Simple competition between them to win market share achieved that. Now, its true, that if we discount the MRSA and so on, the healthcare provided today, is better than the healthcare provided ten years ago. The difference is that the better car I buy today, is also cheaper in real terms than the car of ten years ago, whilst the better healthcare has only arisen because of a huge new demand for money from workers in taxes to finance it. And, in fact, as every Health Economist will admit, the outputs from the massive investment put in, fall way short of what should have been achieved. It is one reason that the Government was then forced to seek to raise those outputs by using Targets, and when that failed to look to privatisation.

Now, I am not saying that private Capital is better, or necessarily more efficient than State Capital, but what I am saying is that the mantra “Private Capital Bad, State Capital Good”, or “Market Bad, Planning Good”, are as useful for a Marxist, in objectively analysing the truth, as the mantra “Four Legs Good, Two Legs Bad”! The Left arrives at such a simplistic view, because for 100 years it has been drowning in a sea of statism, a dirigiste view of socialism, dominated by Lassaleanism and Fabianism.

In fact, as the US Marxist Hal Draper pointed out Marx had no such fetish for planning, and as I’ve shown in many posts certainly no fetish for state capitalist provision.

Draper comments,

““Instead of the revolutionary process of transformation of society,” wrote Marx, Lassalle sees socialism arising “from the ‘state aid’ that the state gives to the producers’ cooperative societies and which the state, not the worker, ‘calls into being.’” Marx derides this. “But as far as the present cooperative societies are concerned, they are of value only insofar as they are the independent creations of the workers and not proteges either of the government or of the bourgeoisie.” Here is a classic statement of the meaning of the word independent as the keystone of Socialism-from-Below versus state-socialism.

There is an instructive instance of what happens when an American-type academic anti-marxist runs into this aspect of Marx. Mayo’s Democracy and Marxism (later revised as Introduction to Marxist Theory) handily proves that Marxism is anti-democratic mainly by the simple expedient of defining Marxism as “the Moscow orthodoxy.” But at least he seems to have read Marx, and realized that nowhere, in acres of writing and a long life, did Marx evince concern about more power for the state but rather the reverse. Marx, it dawned on him, was not a “statist”:

“The popular criticism levelled against Marxism is that it tends to degenerate into a form of ‘statism.’ At first sight [i.e., reading] the criticism appears wide of the mark, for the virtue of Marx’s political theory ... is the entire absence from it of any glorification of the state.”

This discovery offers a notable challenge to Marx-critics, who of course know in advance that Marxism must glorify the state. Mayo solves the difficulty in two statements: (1) “the statism is implicit in the requirements of total planning ...” (2) Look at Russia. But Marx made no fetish of “total planning.” He has so often been denounced (by other Marx-critics) for failing to draw up a blueprint of socialism precisely because he reacted so violently against his predecessors’ utopian “plannism” or planning-from-above. “Plannism” is precisely the conception of socialism that Marxism wished to destroy. Socialism must involve planning, but “total planning” does not equal socialism just as any fool can be a professor but not every professor need be a fool.”
See: Draper – The Two Souls of Socialism .

The reality is, as all of Marx’s writing attests, particularly “The Critique of The Gotha Programme”, but also his comments about Co-operatives in Capital Vol. III, that for Marx far more significant than State ownership or planning was the question of Workers ownership of the means of production. In fact, as is clear from his comments in Capital such a conception implied an acceptance of the continuation of the market! This is important in dealing with your other question about can Co-ops deliver for consumers as well as their workers, and with the response to it from Jay. But, I will come to that later.

But, this concept is vital. As Draper says,

“The Communist Manifesto which issued out of these discussions proclaimed that the first objective of the revolution was “to win the battle of democracy.” When, two years later and after the decline of the 1848 revolutions, the Communist League split, it was in conflict once again with the “crude communism” of putschism, which thought to substitute determined bands of revolutionaries for the real mass movement of an enlightened working class. Marx told them:

“The minority ... makes mere will the motive force of the revolution, instead of actual relations. Whereas we say to the workers: ‘You will have to go through fifteen or twenty or fifty years of civil wars and international wars, not only in order to change extant conditions, but also in order to change yourselves and to render yourselves fit for political dominion,’ you, on the other hand, say to the workers: ‘We must attain to power at once, or else we may just as well go to sleep.’”

“In order to change yourselves and to render yourselves fit for political dominion”: this is Marx’s program for the working-class movement, as against both those who say the workers can take power any Sunday, and those who say never. Thus Marxism came into being, in self-conscious struggle against the advocates of the Educational Dictatorship, the Savior-Dictators, the revolutionary elitists, the communist authoritarians, as well as the philanthropic do-gooders and bourgeois liberals. This was Marx’s Marxism, not the caricatured monstrosity which is painted up with that label by both the Establishment’s professoriat, who shudder at Marx’s uncompromising spirit of revolutionary opposition to the capitalist status quo, and also by the Stalinists and neo-Stalinists, who must conceal the fact that Marx cut his eyeteeth by making war on their type.”
(ibid)

Marx makes a further elaboration of this point in the Critique of the Gotha Programme, where he writes,

“From the remnants of a sense of shame, "state aid" has been put -- under the democratic control of the "toiling people".

In the first place, the majority of the "toiling people" in Germany consists of peasants, not proletarians.

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!”
Critique of The Gotha Programme.

Now, I know that you will argue that you are no longer a Marxist, and so quotes from or about Marx’s position cut no ice. But, I think that given the experience of more than 100 years of Social Democracy, and still more given the experience of Stalinism, these words do hold some cogency, and some importance. The idea that Socialism is about the SELF-emancipation of the class, the idea that human beings do not change overnight simply as a result of a change of property forms – which is my main criticism of Jay’s argument – are surely fundamental to how we go about transforming society!

And, the point is that Marx is also correct in demonstrating that precisely what is dynamic within Capitalism, what drives forward the development of the productive forces, what batters down all Chinese walls with low prices, and indeed, what forms the basis of Capitalism’s “Civilising Mission”, is precisely the market, and competition! Take away that driving force, without any fundamental change in Capitalism relations – and State Capitalism DOES NOT signifiy any such fundamental change – and what you are left with is a system not in transition to a higher form of society, but a system in decay. In fact, you are left with the kind of decadent capitalism that Lenin described mistakenly in “Imperialism”, a Capitalism in which Monopoly removes the progressive drive of competition, and in which the development of the productive forces is then retarded, relatively or absolutely.

Lenin was wrong, because the world he thought he saw of such complete Monopolistic domination did not exist. IN a world of global Capitalist competition it exists even less today. The ONLY area in which the kind of Monopoly power described by Lenin exists is in the arena of State Capitalist provision, and its no wonder that the kind of things that Lenin described in “Imperialism” can be seen most graphically in those areas.

And, of course, although the “Leninists”, and “Trotskyists” – by the way I do not consider myself even an unorthodox Trotskyist for many of the reasons outlined here, I consider myself a Marxist – do have a fetish for “plannism”, and place little relevance on workers ownership, the same ultimately was not true of Lenin, or indeed Trotsky. Its true that Lenin began the revolution by declaring that “State Ownership plus electrification equals Socialism”, but his experience of that State ownership not only led him to NEP, and his attempts to attract Western Capitalists to invest in Russia, but his experience of the growing power of the State bureaucracy, which necessarily arose on that State Ownership, not only led him to declare a War upon it, but led him to the conclusion that “Co-operatives equal Socialism”!

Trotsky had more of a fetish for Planning that Lenin, hence his position over the question of industrialisation, and his call for the militarisation of labour in Transport. But, Trotsky too recognised that the market cannot simply be abolished by administrative decree. He recognised that Socialism required workers to deal with the Market, to understand its operations, and thereby eventually to first control it, and then supercede it.

And this is the point. Marx’s whole view, with which I agree, implies not the immediate supercession of the market, but the negation of the market via its further development, and the further development of the productive forces, which Co-operative production brings about.

Herein lies my answer to your question about Co-operatives, and the way consumer needs are met. Whilst, I agree in part with Jay’s argument that in these spheres, workers will act not just as producers, but will act as workers who are also consumers, this argument – despite the existence of the empirical evidence Jay alludes to – relies on an assumption that workers WILL act in accordance with the way we believe they SHOULD act, undr such conditions. That is it relies on a degree of voluntarism and Moralism that I do not think can be sustained from a Marxist perspective. After all, workers are the main consumers of the goods they produce now. Yet, the “Alienation of Labour”, leads to shoddy production, and the phenomenon of the Friday Afternoon car! Simply overcoming this alienation, creating the “New Man”, is not a simple matter of just changing property relations as I explained in my post The Alienation Of Labour.

In fact, the answer to your question is that my view of Co-operative production in the first instance is not at all reliant upon such voluntarism, does not rely on workers being immediately transformed. It relies precisely, on the discipline of the market, including the element of competition as well as co-operation between Co-operative enterprises. If you read my article about The Economics of Co-operation, you will see that I deal with these questions at some length. So, for example, there is the question about how to deal with workers taking a short term view, and simply draining the enterprise of investment funds through high wages.

Precisely, by giving workers a direct financial interest in the Co-operative, by the dividend they receive from its operations, creates the conditions under which its members seek to meet the needs of consumers, because in doing so like any other enterprise, the success in doing so raises profits and the earnings of Co-op members. But, you are right that other forms of Co-operative are required besides just the producer Co-op. In this regard the example of the “Co-op” itself is instructive.

As a consumer Co-operative, it is owned by consumers rather than producers. Whereas, producers in a producer Co-op are led, by the very nature of production, to participate on a daily basis in decision making, there is no such necessity for members of a consumer Co-op. What is worse, to become a member of the Co-op costs just £1. It is generally the case that if you give things away those that receive them place little value on what they receive. That is why people who have to fight for the right to vote tend to place a higher value on it than those who have inherited such a right, and take it for granted. Its why in long established democracies voters often fail to exercise that right, and take such scant regard to consideration of how they use it.

The same is true for members of the Co-op. Having paid just £1 for their share it is of little economic significance whether the company performs well or ill, because they have no real economic stake to lose or from which to gain. The “divi” becomes no different from the points earned from expenditure given by other supermarkets. The real solution here would be to turn the Co-op into a worker owned Co-op, in which these economic disciplines would then apply. It is through this process that the market is not abolished, but is negated. Starting from the discipline that the market and competition imposes, Co-operative production, and the growing Co-operation between Co-operative enterprises and forms gradually transforms social as well as productive relations, in so doing the workers within them are changed too.

To use Marx’s terminology above they “change (themselves) .. render (themselves) fit for political dominion”.Can we be sure that this transformation will be completed? No, only history can provide that answer.

As Marx said,

“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?”

I want to deal with one final point, which is the idea that Welfarism is something that has been imposed on the Capitalist State by class struggle. I think the facts speak loudly against this notion. The first elements of Welfarism were introduced by the Liberal Government at the beginning of the last century. The further development of it, and the concept of the NHS by the Liberal Beveridge. Moreover, its no coincidence that simialr welfarist polcies exist in every developed Capitalist economy, including in the US. Healthcare again provides a good example. In actual fact, if we want to look to examples of militant class struggle winning reforms from Capital, the example of the well organised sections of Labour in the US provide some of the more notable. Yet, the welfare provision in the US, such as Medicaid and Medicare are not the result of militant class struggle demanding them! On the contrary, what militant US workers demanded and obtained was not State Capitalist Healthcare of Pension provision, but good quality private healthcare funded by their employers. And, for all the broo ha ha, we should be under no illusion that the healthcare provided to the average US worker that does benefit from such company provided insurance is considerable better than that provided to the average UK worker by the NHS. It is inconceivable that the average UAW member would have to accept a 31 hour wait for treatment, for example.

That is why Obama is finding so much opposition amongst well organised workers, who do enjoy such good cover, and fear it being abolished in return for an inferior public service. The real demand for some form of socialised Healthcare in the US, in reality comes from those sections of big Capital, for whom these Company financed insurance schemes have become too costly. Which, of course, was the reason for such schemes being introduced in the UK and elsewhere in the first place.