A social-democratic party, like Labour in Britain, the Democrats in the US, the SPD in Germany, and so on, is a reflection of the reality of the capitalism that has existed since the latter part of the 19th century, when the small individual privately owned capitals, analysed by Marx in Capital, that characterised its early development, were replaced by the large socialised capitals that emerged in the form of the joint stock company, corporation, trust, and the co-operative, whose emergence Marx also analysed in Capital.
As Marx put it,
“The capitalist stock companies, as much as the co-operative factories, should be considered as transitional forms from the capitalist mode of production to the associated one, with the only distinction that the antagonism is resolved negatively in the one and positively in the other.” (ibid, p 440)
“This is the abolition of the capitalist mode of production within the capitalist mode of production itself, and hence a self-dissolving contradiction, which prima facie represents a mere phase of transition to a new form of production. It manifests itself as such a contradiction in its effects. It establishes a monopoly in certain spheres and thereby requires state interference. It reproduces a new financial aristocracy, a new variety of parasites in the shape of promoters, speculators and simply nominal directors; a whole system of swindling and cheating by means of corporation promotion, stock issuance, and stock speculation. It is private production without the control of private property.”
(Chapter 27, p 438)
As Marx describes here, this process meant that along with the abolition of capitalist private property, and the dominance of this socialised capital, went the end of the role of the role of the private capitalist themselves in production. That role, of the "functioning capitalist", directing the production process, was instead taken on by professional managers, who were increasingly drawn from an educated working-class, and correspondingly paid only wages for doing so.
The capitalists themselves became merely providers of loanable money-capital, in the shape of shares, or bonds, living purely from the interest they obtained in the shape of dividends and coupon payments. They formed this new "financial aristocracy", and on the back of the dynamic of this rent seeking financial aristocracy, which differs as markedly from the interests of the large-scale productive-capital as did the interests of the old financial and landed aristocracy, from that of the earlier industrial capitalists, arises all of those new financial swindles, financial speculation and financial crises that have been witnessed with repeated stock, bond and property bubbles, and the crashes that follow them.
But, also, on the basis of this division of interest, arises the real social support of the two major bourgeois ideologies, and the parties derived from them - conservative and social democratic. The former represents the interests of the rent seeking financial and landed aristocracy, along with those of the remnants of the earlier small capitals, whilst the latter represents the interests of socialised productive-capital. The former is necessarily backward looking, attempting to hold back the inevitable development of the economic and social process represented by the accumulation of socialised productive-capital, whilst maintaining the wealth, power and revenues of the unproductive, rent seekers. The latter is necessarily forward looking, anticipating its own demise, as a self-dissolving contradiction, as Marx put it.
Engels described this process.
“The Reform Bill of 1831 had been the victory of the whole capitalist class over the landed aristocracy. The repeal of the Corn Laws was the victory of the manufacturing capitalist not only over the landed aristocracy, but over those sections of capitalists, too, whose interests were more or less bound up with the landed interest - bankers, stockjobbers, fundholders, etc. Free Trade meant the readjustment of the whole home and foreign, commercial and financial policy of England in accordance with the interests of the manufacturing capitalists — the class which now [These words belong apparently not to Bright but to his adherents. See The Quarterly Review, Vol. 71, No. 141, p. 273.-Ed.] represented the nation...
Both these circumstances had turned the English working class, politically, into the tail of the ‘great Liberal Party’, the party led by the manufacturers. This advantage, once gained, had to be perpetuated. And the manufacturing capitalists, from the Chartist opposition, not to Free Trade, but to the transformation of Free Trade into the one vital national question, had learnt, and were learning more and more, that the middle class can never obtain full social and political power over the nation except by the help of the working class. Thus a gradual change came over the relations between both classes.”
(Engels The Condition Of The Working Class In England)
Both these circumstances had turned the English working class, politically, into the tail of the ‘great Liberal Party’, the party led by the manufacturers. This advantage, once gained, had to be perpetuated. And the manufacturing capitalists, from the Chartist opposition, not to Free Trade, but to the transformation of Free Trade into the one vital national question, had learnt, and were learning more and more, that the middle class can never obtain full social and political power over the nation except by the help of the working class. Thus a gradual change came over the relations between both classes.”
(Engels The Condition Of The Working Class In England)
Social democratic parties only have a raison d'etre if they fulfil this function for capital, i.e. to represent the interests of the forward looking, socialised, productive-capital and its accumulation, as opposed to the backward looking, conservative interests of the rent seeking, unproductive sections of society. But, they can also only perform this role, if as Engels says above, they are able to maintain the support of the workers, by simultaneously meeting their immediate needs. It is why social-democracy, at its most rational, is naturally bureaucratic and technocratic, because it is based upon the emergence of such professional managers, as the rational agents of that socialised productive-capital, whether those managers are employed in enterprises, in the state, or indeed in the social-democratic organisations of the workers themselves, their trades unions, political parties and so on.
The failure of social-democracy in the 1970's, was not due to being too left-wing, but of failing itself to be sufficiently consistent representatives of that socialised capital. When it came to the crunch, and the need to resolve the contradictions that existed, by pushing forward the interests of the socialised productive-capital, at the expense of the unproductive financial and landed oligarchies, the leading social-democratic politicians baulked. They bent the knee in deference to the old established political power, of the landed and financial aristocracy, whose continued influence is demonstrated most clearly in Britain, via the continuance of the old feudal institutions such as the House of Lords, and the Monarchy, and all the trappings of the governmental power attached to it.
The closest representation of the interests of this big, socialised capital in the 1970's was provided not by Thatcher, who represented rather the interests of those reactionary classes, and class fractions, or even by Wilson, Callaghan, Healey and others, but by the Labour Lefts, like Benn, and codified in the Alternative Economic Strategy, which carried forward the kind of managerialist, technocratic ideas that Wilson had initially advocated in the 1960's, when social democracy was growing confidently on the basis of the growth of that socialised productive-capital, in the Summer phase of the post-war, long wave boom. Similar ideas were pushed forward successfully in Germany. Where things such as Works Councils, Worker Directors and so on, able to limit the damaging role of the representatives of shareholders on company boards, were written into law.
The main draw back of the AES, and the Bennite Left, for this large socialised productive-capital, was not that it advocated these rational social-democratic structures and strategies, but that it did so, whilst undermining them, to an even greater extent, by a conservative, nationalist ideology reflected in the support for Import Controls, exit from the EEC and so on, all of which were detrimental for the further accumulation of large scale productive-capital.
Had the social-democratic left not been hampered by the continued influence of conservative, nationalist ideas, at that time, things might have turned out considerably differently. Instead of the damage that was done by eighteen years of conservative policies that destroyed huge swathes of productive-capital, solely in order to boost the fictitious wealth of that financial and landed aristocracy, in the form of stock market and property market bubbles, whose inevitable bursting itself causes further economic chaos, Britain could, along with Germany, have promoted a rational development of social-democracy, and the accumulation of productive-capital, whose purpose it is, and whose interests it represents.
Britain, could have implemented the Bullock Report, which would have introduced the same kind of industrial democracy that existed in Germany, that is a necessary, though not sufficient, requirement to prevent the kind of unjustified control of productive-capital exercised by shareowners that leads to the misuse of company funds for speculation and so on, which undermines the accumulation of capital, and various forms of stock manipulation.
When social-democratic parties failed to even carry out consistently the policies required in the interests of socialised capital, they thereby failed in their historic function, as the political representatives of that capital, and in the process opened the door to the pursuance of the interests of those classes and class fractions, whose interests are inimical to the further development of capital.
When the Tories, their media, and the Blair-rights talk about "pro-business" policies, they do not really mean pro-business, in terms of the actual businesses themselves, i.e. the factories, machines, and other means of production contained within them, along with the workers "by hand and by brain", who comprise the workers and managers in those businesses, who actually produce all of the products that society requires, and thereby create all of the social wealth. What they actually mean is the unproductive money lenders, the shareholders and their representatives who sit on the company boards, and hold the controlling positions of CEO, Chairman and so on, above the actual professional managers.
What they really mean are those elements who simply leach off the real wealth created by the actual "business", the workers and managers who organise production and carry it out on a daily basis. When social-democrats failed to carry through their ideas consistently in the 1970's - not as socialists, but as the rational representatives of socialised productive-capital - they opened the door politically for the political representatives of those unproductive sections of society to step into it, and to create the economic, social and political conditions in which we find ourselves today. The Blair-rights, such as Adonis, do not reflect even the kind of social-democracy that an Attlee, Wilson, Callaghan or Healey represented. They represent merely the intrusion of conservative ideas, into the Labour Movement, and the Labour Party, that was made possible by that process.
The underlying material changes occurring within the global economy, held back due to the reactionary political influence of conservatism, which has hampered capital accumulation, are once again undermining the basis of conservatism itself. That is the basis of the crisis facing the EU, reflected in the confrontation over Greece and austerity, it is the basis of the rise of more rationally social-democratic parties such as Syriza, Podemos, and of Corbyn in the UK and Bernie Sanders in the US, amongst others. It is a battle between conservatism and social democracy being played out across the globe.
For example, Obama in a speech last week, effectively slammed the conservative policy of austerity being followed in Britain, and other parts of Europe, in the process of attacking the Republicans who want to introduce austerity in the US, and are threatening to once again bring the US government to a halt, in order to do so. The reason the US had continued to grow, far more strongly than others, Obama said, was because they had not followed the same policies of austerity that had been imposed in Europe.
If people like Adonis, return to their natural home in the Tory Party, that is actually beneficial for a social-democratic party like Labour, because it reduces the energy that has to be wasted confronting the reactionary ideology they represent, within the party itself. It means the party can more easily fulfil its function of truly representing the "pro-business" needs of the accumulation of real productive-capital, as opposed to the needs of promoting fictitious wealth in the shape of various asset price bubbles, upon which the economy has been based over the last 30 years.
When social-democratic parties failed to even carry out consistently the policies required in the interests of socialised capital, they thereby failed in their historic function, as the political representatives of that capital, and in the process opened the door to the pursuance of the interests of those classes and class fractions, whose interests are inimical to the further development of capital.
When the Tories, their media, and the Blair-rights talk about "pro-business" policies, they do not really mean pro-business, in terms of the actual businesses themselves, i.e. the factories, machines, and other means of production contained within them, along with the workers "by hand and by brain", who comprise the workers and managers in those businesses, who actually produce all of the products that society requires, and thereby create all of the social wealth. What they actually mean is the unproductive money lenders, the shareholders and their representatives who sit on the company boards, and hold the controlling positions of CEO, Chairman and so on, above the actual professional managers.
What they really mean are those elements who simply leach off the real wealth created by the actual "business", the workers and managers who organise production and carry it out on a daily basis. When social-democrats failed to carry through their ideas consistently in the 1970's - not as socialists, but as the rational representatives of socialised productive-capital - they opened the door politically for the political representatives of those unproductive sections of society to step into it, and to create the economic, social and political conditions in which we find ourselves today. The Blair-rights, such as Adonis, do not reflect even the kind of social-democracy that an Attlee, Wilson, Callaghan or Healey represented. They represent merely the intrusion of conservative ideas, into the Labour Movement, and the Labour Party, that was made possible by that process.
The underlying material changes occurring within the global economy, held back due to the reactionary political influence of conservatism, which has hampered capital accumulation, are once again undermining the basis of conservatism itself. That is the basis of the crisis facing the EU, reflected in the confrontation over Greece and austerity, it is the basis of the rise of more rationally social-democratic parties such as Syriza, Podemos, and of Corbyn in the UK and Bernie Sanders in the US, amongst others. It is a battle between conservatism and social democracy being played out across the globe.
For example, Obama in a speech last week, effectively slammed the conservative policy of austerity being followed in Britain, and other parts of Europe, in the process of attacking the Republicans who want to introduce austerity in the US, and are threatening to once again bring the US government to a halt, in order to do so. The reason the US had continued to grow, far more strongly than others, Obama said, was because they had not followed the same policies of austerity that had been imposed in Europe.
If people like Adonis, return to their natural home in the Tory Party, that is actually beneficial for a social-democratic party like Labour, because it reduces the energy that has to be wasted confronting the reactionary ideology they represent, within the party itself. It means the party can more easily fulfil its function of truly representing the "pro-business" needs of the accumulation of real productive-capital, as opposed to the needs of promoting fictitious wealth in the shape of various asset price bubbles, upon which the economy has been based over the last 30 years.
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