The Economy Of Analysis - Part 11

What is noticeable is that nearly all of the Left's analysis of the crisis is based not on Marxism, but on Lassalleanism.

It is based on the same kinds of ideas that he and his followers put forward about the “Iron Law of Wages”, and the immiseration of the working-class, that were adopted and clung to, to the point of absurdity, by the Stalinists. As Mandel points out in “Marxist Economic Theory”, Stalinist economists were performing all sorts of intellectual acrobatics during the 1950's and 60's, to try to show that, while it was obvious to anyone with a pair of eyes, workers living standards in the West were rising sharply, western workers were really being immiserated, and it was all a trick, an illusion!

In fact, as again Mandel points out, Rosdolsky, had trawled all of Marx's writings, and out of several thousand references to wages, could find just one that could in any way, be interpreted as arguing for such immiseration. The statements by Marx, arguing against it, and against the Iron Law of Wages, however, are not at all hard to find. But, not only is the analysis based on Lassalleanism, but the solutions put forward, where solutions are put forward at all, are also based on Lassalleanism, and Fabianism, rather than Marxism.

Socialist Worker have an article, which provides no explanation of the crisis beyond “we live in a rogue system”. That may be a catchy statement, but it is meaningless. They talk about the strikes on 30th November being a means of standing up to market mayhem, but, of course, they will do no such thing.

Marxists, will support the strikes, for the same reason that Marx argued for supporting such struggles, in order to be with the workers, but they offer no actual solution to the crisis, and present no alternative to it. The success of the strikes, at best, would mean a temporary, different, balance between Capital and Labour within the existing market system. SW say none of the plans of Governments are able to “restore the system to health”, but the success of the strikes, would mean it being made less healthy in its own terms.

So they cannot be a solution to that crisis in the way they suggest. Meanwhile, as they say, we have the power to bring that system down – though its not clear that such is at all likely under current conditions – but they offer workers nothing here and now that would make the system “healthier”, or any alternative to the system after it has been brought down.

The Socialist Party provide a version of the Lassallean, “Iron Law of Wages”, and Stalinist immiseration theory that only makes them look stupid. It clearly is not true, if you look at China, India, and many more parts of Asia, Latin America, and Africa, either that “Capitalism is a bankrupt system", or that "billions of people around the world face growing poverty.”

On the contrary, in all these places, Capitalism is demonstrating that it is still vibrant, still revolutionising the methods of production, and has in the words of the “Communist Manifesto”, rescued millions from the “idiocy of rural life”. The developing economies are creating 20 million new jobs each year!! Trying to deny this, and to argue that Capitalism has to drive down wages, or is only able to pay bear subsistence wages, is not only ridiculous, but is contrary to Marx's analysis. In the Critique of the Gotha Programme, Marx spells out what is wrong with this kind of analysis.

“that, consequently, the system of wage labor is a system of slavery, and indeed of a slavery which becomes more severe in proportion as the social productive forces of labor develop, whether the worker receives better or worse payment. And after this understanding has gained more and more ground in our party, some return to Lassalle's dogma although they must have known that Lassalle did not know what wages were, but, following in the wake of the bourgeois economists, took the appearance for the essence of the matter.

It is as if, among slaves who have at last got behind the secret of slavery and broken out in rebellion, a slave still in thrall to obsolete notions were to inscribe on the program of the rebellion: Slavery must be abolished because the feeding of slaves in the system of slavery cannot exceed a certain low maximum!”

In other words, whilst Marx had demonstrated in many places such as in the “Grundrisse” that Capitalism raises workers real wages, “The Civilising Mission”, as he describes it there, it is able to do so, precisely because of the continuing ability of Capitalism to revolutionise production, to extract Relative Surplus Value, as a result, which enabled both profits, and real wages to rise.

So, the idea behind the “Iron Law”, which is essentially Malthusian, is false. But, this does not at all invalidate the argument for Socialism, because our argument, in that respect, is not that Capitalism necessarily immiserates the workers, but that, however well paid they are, however affluent they are, it is bought at the expense of their increasing slavery, at the expense of only achieving this affluence, by agreeing to work an increasing proportion of each day, for free!!!

The SP solution to this is not that put forward by Marx – a change in ownership of the means of production, through the creation of worker owned Co-ops as a prelude to a social revolution – but is the Lassallean/Fabian policy of redistributive socialism through taxing the rich, which Marx specifically said could not work, and also, by strengthening the role of the Capitalist State, also undermined the position of workers and the development of their own “self-government”. In the CGP, Marx says,

“I have dealt more at length with the "undiminished" proceeds of labor, on the one hand, and with "equal right" and "fair distribution", on the other, in order to show what a crime it is to attempt, on the one hand, to force on our Party again, as dogmas, ideas which in a certain period had some meaning but have now become obsolete verbal rubbish, while again perverting, on the other, the realistic outlook, which it cost so much effort to instill into the Party but which has now taken root in it, by means of ideological nonsense about right and other trash so common among the democrats and French socialists.

Quite apart from the analysis so far given, it was in general a mistake to make a fuss about so-called distribution and put the principal stress on it.

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?”

Yet, much of the Left today focusses precisely upon this “ideological nonsense” and “trash”, and does put a principal stress on making a “fuss” about distribution – whether to be effected through Economistic wages struggles, or reformist dreams of redistribution via the tax system – rather than as Marx and Engels argued, showing not only how Capitalism provides the basis for reconstructing society, and how that, through the establishment of Co-operative production, is the only real means of effecting a different distribution. As Marx, also points out in the CGP,

“Taxes are the economic basis of the government machinery and of nothing else. In the state of the future, existing in Switzerland, this demand has been pretty well fulfilled. Income tax presupposes various sources of income of the various social classes, and hence capitalist society. It is, therefore, nothing remarkable that the Liverpool financial reformers — bourgeois headed by Gladstone's brother — are putting forward the same demand as the program.”

And, in the Programme Marx wrote for the First International, he sets out why he was opposed to high rates of taxation.

“(a) No modification of the form of taxation can produce any important change in the relations of labour and capital.

(b) Nevertheless, having to choose between two systems of taxation, we recommend the total abolition of indirect taxes, and the general substitution of direct taxes. [In Marx's rough manuscript, French and German texts are: "because direct taxes are cheaper to collect and do not interfere with production".]

Because indirect taxes enhance the prices of commodities, the tradesmen adding to those prices not only the amount of the indirect taxes, but the interest and profit upon the capital advanced in their payment.

Because indirect taxes conceal from an individual what he is paying to the state, whereas a direct tax is undisguised, unsophisticated, and not to be misunderstood by the meanest capacity. Direct taxation prompts therefore every individual to control the governing powers while indirect taxation destroys all tendency to self-government.”

It is clear from these programmatic and analytical writings of Marx, just how far he was from the Left of today, which has abandoned him for the ideas of Lassalle and the Fabians. Tomorrow, I will continue to look at how far the response of the Left diverges from Marxism.

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