International Socialists

The vocabulary of socialism can seem to those not familiar with it almost incomprehensible, but this is not because the ideas themselves are difficult to understand. Rather, it is because they are so dangerous to the current order that they are not taught or explained in the mainstream like other aspects of our intellectual world. The classical Marxist tradition offers a comprehensive explanation of a complex and dynamic system - capitalism - and therefore must itself offer complex and dynamic explanations. These ideas can be explained quite easily because they impact directly on our lives - they "ring true." And these terms and descriptions are not only of academic interest: the point of understanding the world, as Marx put it, is to change it. In the first of a regular series, "Ideas we need to understand the world and fight for change," Dougal McNeill looks at three ideas we can use to change the world - alienation, exploitation and crisis.

 

 

Alienation

You don't have to be a Marxist to notice that most people don't like Mondays. Work, "that toad" which dominates and defines modern existence, is almost universally deplored and disliked. We wait for the weekend and dream of retirement while spending most of our lives doing things we don't like, for people we don't like, at a place we don't like. Despair, depression, general boredom and absurdity seem to characterise the fabric of all aspects of modern life - not just those of the workforce - and a sense of foreignness, of strangeness and disconnection from others is one which is not foreign to all too many people. Karl Marx recognised that this state came to a large degree from the way our lives were ordered - how work and labour, and thus the main part of our existence, were organised.

 

For Marx, alienation began with how labour was organised. He saw economic alienation inherent in how capitalism organised itself, with a boss employing someone by paying them in exchange for a set amount of their time. This exchange produces a very practical alienation, that of the producer from what they produce, which becomes - along with its destination - an irrelevancy. Thus a cafe worker can spend all day making coffees and go home in the evening to a house without even a plunger. "Work" and its end products are disconnected from one another. Similarly, when the employer pays a wage another form of alienation is taking place. This very work, the end product of which is no longer our own, becomes itself quite foreign. The ownership of our own labour passes to the person paying for it.

 

This situation leads to other implications. Divorced from the rest of our lives and no longer connected to the thing it is producing or the person who produces it, work becomes something imposed by others, a dull chore which cannot satisfy our own needs but serves instead only those needs of the activity itself. Workers become cogs in a big machine - depersonalised and dehumanised. Working a checkout, serving at McDonalds, telemarketing, or any of the other tasks which dominate society confirms this sense in most people.

 

Work dominates our lives, and so the way it is arranged and organised tends to end up being mirrored by the other aspects of our lives. Being subjected to the sort of machine like routine of a working day which is focused around selling your time to another does not produce an alienation that begins and ends in this timeframe. Rather, this same sense begins to affect all aspects of life just as the situation which creates it orders all these aspects. Selling labour stifles human freedom and creativity to the tyranny of the timesheet. The final aspect of Marx's analysis is this self alienation - by becoming distanced from the results and processes of our labour we at the same time become distanced from our own potential and our own opportunities for expression and development. As Milan Kangrga put it, "To be alienated from history as human praxis and a human product."

 

Surviving under capitalism involves abandoning what  makes us fully human. Everyone must work to live, yet the way we work involves abandoning that very sense of power which makes us feel fully alive. This is an idea echoed in the "Happy Hours" across the country. Happy indeed for the release from spirit numbing dissatisfaction into relaxation and the frustration numbing drug of alcohol. The drug abuse, depression and  suicide statistics which are all so alarmingly high in New Zealand are a devastating indictment of the capitalist system.

 

When Marx wrote about alienation from oneself he was not, as some humanists stupidly suggest, suggesting some sort of mystical "human nature." "Alienation" is not meant to be an impossible to understand term. Rather, it is the recognition of how structures of capitalism create the potential for human creativity and capacities for freedom while at the same time making them unachievable and impossible.

Marx did not analyse alienation just to depress us all. Evidence of  it exists merely in the observation of our own lives, after all. What Marx recognised was that denying this reality by retreats into sentimentality or blind optimism would just make it worse. By looking at the root causes of a society as alienated as our own - the way capitalism organises labour - we can focus on the enemies of our own satisfaction and creativity. We can use this knowledge as a tool to fight for change. To understand why these states are the case, however, we must turn now to exploitation and crisis.

 

 

Exploitation

The liberal theorist would have us believe that discussions of alienation like the one above are misguided and foolish. After all, hasn't humanity been divided from itself since the beginning of time? And this nonsense about "the organisation of labour," scoffs our liberal friend, isn't this just a mean spirited way of describing something quite fair - the exchange of  one thing for another? The worker gets a fair wage in exchange for a fair day's work. Nothing can be fairer than that, right?

 

Wrong. Exploitation, far from being the exception employers and reformist union bureaucrats would have you believe, is an essential part of capitalism. Marx recognised this, and began his exploration of it through an analysis of "commodity," for under capitalism capital - things or cash - and labour power are both "commodities," things made for exchange.

 

Commodities can be nuclear arsenals or deodorant sticks, rubber kiwis or Mazda cars, any number of a variety of things. What all commodities share in common is that they can all (through money) be exchanged for one another. This is possible only because commodities have the common property of having been produced by a definite amount of human labour time. The value of a particular commodity is determined by the amount of labour time a society has to spend on producing it. This is what Marx calls the "socially necessary labour time," and can be illustrated by comparing price tags in a "$2 Shop" and those of a luxury gift shop.

 

With this in mind, apply this idea of value to labour power itself. The value of labour is also determined by the amount of labour time needed to produce it - that is, what it takes to feed, clothe, house, educate and reproduce the worker. A worker's wages pay for these costs of "producing" their ability to work.

But labour power is different from all other commodities. It is creative. It produces more value than it takes to maintain itself. If it was not true that human labour produced more than it consumed there would have been no development in our productive forces; in other words, there would have been no history. But this "surplus" value goes to the employer and not the employee who made it.

 

So if a worker is paid $350 by their employer for, say, 40 hours of work, (enough to support them for the week) he or she will produce $350 of goods in, say, only 20 hours. The remaining 20 hours go straight to the capitalist's profit as a form of unpaid labour. This is the hidden secret of capitalist exploitation. Beneath the apparent "fair" exchange, it is the source of all profit. For in those extra 20 hours - the figure will of course vary with the circumstances - the worker will produce another $350 worth of goods for the capitalist. This is what Marx called "surplus value." It is the capitalist's profit.

 

As this example has shown, exploitation is central to the wage labour system. In a class society such as our own, where a tiny group control the whole society's means of producing goods and services, exploitation and alienation are necessities. This applies just as much to the "new" service industries. An increase in productivity at Village Rialto is the same as one at Watties. The only difference is in the appearance of cans and customers - the relation between worker and boss remains identical.

 

Marx's theory of surplus value does more than prove that capitalism is based on exploitation. It also reveals the irreconcilable conflict of interests that lies at the heart of the system and divides us into classes. Driven by competition, capitalists seek always to extend the unpaid labour time - the profit - they can extract from their workers. When the mainstream media tells you business growth and increases in profitability are good for all of us they mean the "us" which is that tiny minority of capitalists. Driven by human need, workers seek to reduce the amount of unpaid time squeezed out of them. So, on one side speed ups, productivity deals, wage cuts, individual contracts; on the other side wage demands, strikes and the whole history of the trade union struggle.

 

The only solution to the conflict is for workers to go beyond struggle over the role of exploitation, and abolish it by seizing the means of production and ending the sale of labour power. "We created it - let's take it over," Patti Smith once sang, and the statement echoes in workers' struggles. We have nothing to gain from a company's success or growth. Instead of buying New Right nonsense about "teams" and joining together for "common interests" we need to recognise these for what they are - the theft of our labour. We make the value in those things we work with, whether through service or more traditional production lines. They are ours for the taking.

 

 

Crisis

Our liberal companion will probably have been spluttering indignantly throughout this call to revolution. After all, calling for a revolution is profaning those gods of Stability and Progress the liberal establishment would have us all prostrate ourselves before. But even the quickest glance at political or economic history reveals the fact - obvious enough to anyone other than the economist High Priests of Rogernomics - that capitalism is based around chaos, crisis and instability. Any plan for human liberation which attempts to work within a capitalist framework will eventually come up against this insurmountable obstacle.

 

Capitalism is a system of recurring economic crises. Throughout the 1980s and  90s we lived through one. To the rulers of our society and their apologists - journalists, politicians, economists and the rest - the explanations for crises vary from the likely criminals of solo mothers and greedy unions all the way through to those convenient scapegoats of evil, the wharfies (bad), teachers (worse) and Asian immigrants (even worse).

 

What is clear is that in all of capitalism's crises the working class, the vast majority of society, suffers the most. Unemployment remained high throughout the last decade, and mass unemployment on a scale previously inconceivable is now accepted even in times of recovery. The advent of casualised and part time work combined with disguised unemployment makes the problem far greater than the statistics reveal.

The Marxist explanation of unemployment starts from the fact that capitalist production is production for profit. Where the classical conception of exchange went from commodity to money to commodity, under capitalism the reverse of this is the case. Money purchases a commodity - the combination of capital and labour - for the purpose of making more money. Within this formula lies the origin of all crisis - where once an undesired commodity would simply remained unproduced, under capitalism it exists for its money value.

 

As one writer puts it, "The possibility of crisis arises from the fact that the commodity may fail to complete this metamorphosis: it may fail to be sold." It follows from this that under capitalism people are only employed when their employment, directly or indirectly, assists the making of profits. When it ceases to do so they cease to be employed.

 

The key to the overall level of unemployment at any time is therefore the average rate of profit across industry as a whole. When the average rate of profit is high, as it was in New Zealand in the "Golden Weather" post war boom, then capitalists are keen to expand their operations, to invest, to launch new projects and to take on new labour. When the average rate of profit is low, capitalists are reluctant to invest. Old industries become out of date and uncompetitive for the lack of new processes and are forced to close. New industries fail to take their place. Unemployment rises.

 

Each of these situations creates a certain momentum of its own. When new workers are taken on they have more money to spend. Demand for goods increases and production rises to meet this demand. Still more workers are employed to raise production, and so on. On the other hand, when unemployment rises workers who find themselves on the dole have less to spend. Demand for goods falls, production falls and more workers are made redundant. There is a slump.

 

This all leads us to an overwhelming question: What makes the rate of profit high or low in the first place? What decides whether the economy is to surge skywards in boom or slide towards recession. Two processes are at work, one cyclical and the other more long term. The cyclical process causes the system to alternate, more or less regularly, from boom to slump and back again. In the boom increased demand for labour enables workers to push up wages to the point where they begin to cut into profits. The rate of profit falls and the balloon of boom has been burst, sending it spiralling and spinning into slump. In a time of recession unemployment cuts the bargaining power of workers and wages fall until eventually the rate of profit is restored. The slump turns into boom and the whole process begins again, bruised and battered from the experience but still intact.

 

The second long term process is more fundamental. It is an "underlying tendency for the rate of profit to fall."

 

Because capitalism is competitive, each capitalist unit strives to produce as much as possible, to seize as large a share of the market as it can. But capitalism is also exploitative, and so never pays workers enough for them to buy up all the goods they themselves produce. As a result, and because of the inversion of the traditional commodity-money-commodity cycle mentioned above, the system is faced with the constant danger of overproduction, of producing more than can be sold. This problem cannot be solved by wage increases because these would cut into profit. Instead, capitalists must continually re-invest their profits by producing ever more ways of producing, ever more "means of production" - more machines, and still more machines for making more machines. This solution works for so long as capitalists invest, something they continue to do only so long as it continues to result in profits.

 

However, it should become obvious that this investment in production only serves to deepen the extent of the wider crisis, and adds to profit's long term tendency to fall. Profit itself derives only from the exploitation of labour power, from the living "machines" of workers and not from the accumulated or dormant labour resting in machines. Therefore, as capitalists buy more and more machinery the amount of living labour becomes a proportionately smaller part of their outlay. We have seen this process in our so called "Computer Age," where new technologies have allowed one worker to perform the tasks of many, and companies such as Telecom have sacked up to three quarters of their workers.

 

The result of this is that the rate of profit declines, despite the capitalists' attempts to counteract this by driving their workers to work harder and longer hours.

 

Once the rate of profit falls below a certain level, the incentive for capitalists to invest has gone and we have returned to another slump. Heightened unemployment, attacks on welfare, mass redundancies, and bankrupted firms are all examples of this.

 

Economic crisis in turn destroys a lot of capital by bankrupting weaker firms, thus making a higher rate of profit possible for the ones that survive. This explains why capitalism generally alternates between boom and slump. Sooner or later, however, the growth of a boom time ensures that the basic tendency for the rate of profit to fall reasserts itself. Each time this happens, as a result of capital's larger units and concentrated nature, the recession is worse and the recovery weaker. Capitalism finds it more and more difficult to use short, sharp crises to destroy sections of capital and to restore the rate of profit. Instead we have a somewhat less sharp collapse but one which drags on and on without any hope of real recovery.

 

The tendency of the rate of profit to decline is a fundamental and unsolvable contradiction of capitalism. Social democrats who point to the Scandinavian Shangri-las of Sweden and Norway as examples of how capitalism can evolve into stable egalitarianism muddle reality. A state can disguise and muffle crisis - abundant North Sea oil and decades of dipping into the United States' Marshall Aid slush fund see to this - but even they are part of the cycle whether as victims or international exploiters, as recent attacks on the Swedish welfare state show. Mass unemployment is the result of contradictions built into the very core of capitalism, of a system based on the search for profit. Only when production is for human need, not profit, will we be free of economic crises and the untold misery they cause.