Duncan Hallas

Duncan Hallas
The Meaning of Marxism

(1971)
1
The Meaning of Marxism Duncan Hallas Halaman 2
First published as a series in Socialist Worker, November 1970-February 1971.

Published as a pamphlet in March 1971 by Pluto Press on behalf of the
International Socialists.
Revised edition published in June 1975 by the International Socialists.
The IS also published a Study Guide for The Meaning of Marxism in 1972; the
individual chapters are linked to the relevant parts of this Study Guide.
Transcribed & marked up by Einde OCallaghan for REDS Die Roten.
Introduction
The chapters of this pamphlet first appeared as weekly

articles in Socialist Worker. They are intended as an
introduction to some of the leading ideas of Marxism. Of
course the theory is mixed up with history. This has to be so
because Marxism doesnt exist outside time and space but
is, as Engels said, not a dogma but a guide to action.
As far as possible I have let Marx speak for himself but I

have not encumbered this little text with footnotes and
references to quotations. Instead I have added a short list of
pamphlets and books for further reading. For the 1975
edition some of the figures, for wage levels for instance,
have been brought up to date.
Duncan Hallas
Table of Content
1. Why we need a theory

2. The battle for markets
3. The workers vital role
4. Who produces the wealth
5. The systems driving force
6. What causes the crisis
7. The march of the giants
8. The white mans burden
9. Modern capitalism
10. Arms: key to postwar recovery
11. The end of postwar stability
12. Ideas: how the ruling class keeps its grip
13. Greedy workers
14. Public interest: dust in workers eyes
15. European revolution defeated
16. The rise of Stalins dictatorship
17. Stalins zig-zags
18. The only way forward: an international strategy
Reading list
l. Why we need a theory

History, said the late Henry Ford, is bunk. A lot of
people agree with him. After all, what does it matter to
anyone today whether Alfred burned the cakes or James
Watt got the idea of the steam engine by watching a kettle
boil over? These stories are probably fairy tales, like a lot of
other things taught in schools. But whether they are true or
not makes not a pennyworth of difference to any of the
problems we have to live with.
Leave aside fairy tale history and look at some of the

questions serious historians have tried to answer. For
example, why and how did Britain become the first
industrialized country? Or what made it possible for the
Russian Communist Party to take power?
Interesting problems for students but do the answers

really make any difference to us? What is done is done and
cant be altered. Karl Marx argued that the past does matter
because you cant understand what exists today unless you
have some idea of how things came to be the way they are.
More important still, if working people are conscious of
what is happening, and that means knowing something of
what has happened, they can decisively affect the outcome.
The employing class and its politicians and intellectuals

have some sort of picture of the world, of how it changes, of
what is possible for them, of history in short. They make
their decisions, in part at least, in the light of that
knowledge. We need our own picture, our own knowledge,
our own theory. Marxism is, among other things, a theory of
history for working people. But why a theory of history.
Cant the facts speak for themselves?
Actually facts never speak for themselves. As a well-

known modern historian put it the facts speak only when
the historian calls on them. It is he who decides which facts
to give the floor and in what order ... The historian is
necessarily selective. The belief in a hard core of historical
facts existing objectively and independently of the
interpretation of the historian is a preposterous fallacy ...
There are countless millions of facts. Which facts are
important depends on what kind of theory you have and this
in turn depends on what you are interested in, on what you
are trying to do.
Marx was interested, first and foremost, in social

change. His materialist conception of history is essentially
a guide to the present in the light of the past. Its basic ideas
are simple though their application and development is
often complex. The history of all hitherto existing society,
he wrote, is the history of class struggles. Freeman and
slave, patrician and plebian, baron and serf, guildmaster
and journeyman, in one word, oppressor and oppressed,
standing constantly in opposition to each other, carried on
an uninterrupted warfare, now open, now concealed; a
warfare which always ended either in a revolutionary
transformation of the whole of society or in the common
ruin of the contending classes ...
Modern capitalist society, springing from the wreck of

feudal society, has not abolished class antagonisms. It has
only substituted new classes, new conditions of oppression,
new forms of warfare, for the old. Classes rather than great
men are the important thing. Of course classes are made up
of individual people and some individuals are much more
important than others. But bad King John or good
George Washington are, from a Marxist point of view, more
important for the class interests they. represented than for
their personal virtues or vices.
That immediately brings up another point. If the

struggle between classes is the real motor of history then
good and bad are relative terms. What is good for one
class may be bad for another. The great French revolution at
the end of the 18th century was a good thing from the point
of view of the middle classes who were the people who got
most out of it. It was a very bad thing for the aristocracy
who lost their privileges, lands and, in some cases, their
heads.
There can, in fact, be no impartial history. Everyone is

part of some society and of some class in that society. The
historian who claims to be impartial is a fraud. Either he is
deceiving himself or his readers. Does this mean that any
view of the world is as good as any other? The point is that
ideas about society are always connected, sometimes
directly but more usually indirectly, with some class interest
or other.
But why should we believe that our interests, say, are

ethically better than those of the capitalist class? Part of the
answer, in Marxs words, is that the working class
movement is the conscious movement of the immense
majority in the interest of the immense majority.
There is a still more basic reason. The kind of society

that exists in a particular place at a particular time depends
on the way that men are able to earn their living.
Stone axes and wooden spears go with a tribal society

based on hunting and without class divisions. Every
subsequent technical advance the wooden plough, water-
driven machinery, the steam engine has
had social consequences. Assume particular stages of
development in production, commerce and consumption,
wrote Marx, and you will have a corresponding
organization of the family, of orders or of classes, in a word,

a corresponding civil society ... particular political
conditions.
All forms of society before capitalism had this in

common. The technical level, or, to put it another way, the
productivity of labor, was too low to allow everyone a decent
standard of life. The existence of oppressed and exploiting
classes was unavoidable. Capitalism has changed all that.
The development of techniques of production under
capitalism has been so great as to make possible, for the first
time in human history, a society free from a desperate
struggle for bare existence. It has made it possible but at the
same time has built barriers to prevent it coming about.
In fighting to overthrow capitalism we know that we are

not fighting merely for our own interests or even for the
interests of the great majority. We are fighting for the only
way forward for the whole human race.
2. The Battle for Markets

Capitalism is the most revolutionary social system that has
ever existed. Change, continuous and ever more rapid
change, is built into its structure. The capitalist class
cannot exist, wrote Karl Marx, without constantly
revolutionizing the instruments of production, and thereby
the relations of production, and with them the whole
relations of society.
Two hundred years ago, the English peasants and the

majority of working people were then peasants lived and
worked in ways not too different from those of their Saxon
ancestors.
Of course there had been many changes. If Wat Tyler

and the other leaders of the great peasants revolt of 1381
had been resurrected in 1750 they would have seen many
things that would have astonished them. Yet they would
have had no difficulty in understanding the way of life of the
mass of the people.
The peasants still worked iii the open fields with the
same tools and the same methods that had been used from
time immemorial. They still went hungry and cold every
winter and celebrated the coming of spring with an
enthusiasm unimaginable to us today.
The big houses, the magnificent homes of the gentry

and the higher clergy, with their hordes of servants, still
dominated the land as they had done for a thousand years.
In 1750 Britain stood on the eve of the greatest change

in human life since the invention of agriculture. Industrial
capitalism, after centuries of gradual advance, was about to
make its great leap forward. And the change was not to be a
once and for all affair. Once the process got under way it
was to transform the world and to go on transforming it.
First of all capitalism created a world market. Long-distance
trade can be traced back to the stone age but its effects on
most societies were marginal.
With capitalist production they became central. The

first breakthrough to industrialization in Britain could not
have taken place without what a conservative historian
politely called the appropriation of extra-European
resources and labor. War, looting and slavery played an
important part in this process of primitive accumulation
the initial gathering together of resources to turn into
capital but trade, unequal and semi-monopolistic trade,
was the central feature.
The economic historian E.J. Hobsbawm has

summarized this development. Behind our Industrial
Revolution there lies this concentration on the colonial and
underdeveloped markets overseas, the successful battle to
deny them to anyone else. We defeated them in the East: in
1766 we already outsold even the Dutch in the China trade.
We defeated them in the West: by the early 1780s more than
half of all slaves exported from Africa made profits for
British slavers. And we did so for the benefit of British
goods ... Our industrial economy grew out of our commerce,
and especially our commerce with the underdeveloped
world.
The political basis for the series of wars of aggression

that made possible the birth of British capitalism had been
laid earlier. The English revolution of the 17th century had
created a political system and a ruling class that could, at
the same time, ruthlessly oppress the people of Britain and
fight other ruling classes for world supremacy. But the
effects of the first phase of British imperialisms were quite
different from those of previous conquerors.
Genghis Khan and his kind had created great empires

but little social change. The British expansion of the 18th
and 19th centuries was quite different. It was the bearer of
revolutionary social change.
In some countries the outcome of earlier class struggles

made it possible for capitalist classes to gain control and to
imitate and improve on the British model. France, Belgium,
Germany, after more or less violent political changes,
became developed capitalist countries. So, after a civil war,
did the USA and later on, Japan.
Other countries, where the previous struggles had left

potential or actual capitalist classes too weak to seize power,
became colonial or semi-colonial areas. But they, too, were

transformed out of all recognition. Their social systems did
not stand still. They were thrown back. Their economies
became more impoverished more underdeveloped than
they had been in pre-capitalist times.
The West industrialized, they were de-industrialized.

In 1810 nearly 40 per cent of the people of India lived in
towns in which hand production of textiles and metal goods
was carried on. By 1900 only just over 10 per cent lived in
towns and this in spite of the rapid growth of some big
cities.
Once established the world market dominated, and

continues today to dominate, economic life everywhere.
Purely national solutions to economic and social problems
are out of date. The basis of internationalism is the fact that
decisions taken in Frankfurt, New York or Osaka affect
vitally what happens in Birmingham and vice-versa.
The second revolutionary effect of capitalism was an

unprecedented increase in the productivity of labor. Over a
century ago Marx could write the capitalist class during its
rule of scarce 100 years had created more massive and more
colossal productive forces than have all preceding
generations put together.
Since that time the growth in the productivity of labor

and in techniques of production that has been produced by
capitalist competition has made the productive forces of
Marxs day look tiny. Of course increasing output under
capitalism will not solve our problems. In fact it can, in
some circumstances make them worse.
The point remains that the material basis for a world

society based on free co-operation has been created by
capitalism. If the present productive equipment, without
allowing for any increase, was rationally organized to

produce for need and not for profit, it would be possible to
abolish. poverty everywhere in the world.
The third revolutionary consequence of capitalism has

been the creation of the human basis of socialism, the
modern working class. The central theme of Marxs thought
is that this class is unique in history both for what it is and
for what it can become.
3. The Workers Vital Role

A development of the productive forces is the absolute
practical premise of communism because without it want is
generalized, and that means that all the old crap must revive
again. By all the old crap Marx meant classes, inequality,
class struggles and war.
On a world scale this problem has been solved. The

material basis for socialism exists but as a result of the
course of capitalist development it is very unevenly
distributed. For example, in the USA output per man-hour,
averaged for all sectors of the economy, rose from 37 units
in 1870 to 100 units in. 1913 (taken as base line), to 208
units in 1938 and to nearly 400 units in 1963.
On the. other hand in most of the under-developed

countries overall productivity remains very low. It has been
kept low by the competitive power of the developed
capitalist countries and by the transfer of resources from the
underdeveloped to the developed by imperialism.
A Chinese economist published a book in 1950 giving

these figures. In the USA there was an average of about
600 times more industrial capital per head (of the
population) than in China, or more than 900 times if
manufacturing capital alone were considered. Even making

every allowance for industrial development since 1950 it is
clear that the basis for a classless society in in isolated China
does not exist.
The same argument applies to the rest of the Third

World, that is to two-thirds of mankind. What does exist is
the possibility of an international socialism and this
requires the growth of an international revolutionary
movement.
Such a movement must be based on the industrial

working classes. This is not a question of dogma. It is
fundamental to the Marxist analysis of society and follows
from the actual life situation of the modern workers as
compared to that of all previous exploited classes.
While it is the case that the low level of the productivity

of labor was the basic reason for inequality and exploitation
in pre-capitalist societies there was also another reason. In
pre-industrialized societies the working people, whether
slaves, serfs or free peasants, normally worked in fairly
small groups isolated from similar groups widely scattered
over the countryside. This made it very difficult for them to
think in collective terms and still more difficult for them to
act as a class.
As Marx, writing of the French peasantry, noted:

Insofar as millions of families live under economic
conditions of existence that divide their mode of life ... from
that of other classes, and put them in hostile contrast to the
latter, they form a class. Insofar as there is merely a local
interconnection among these small peasants, and the
identity of their interests, begets no unity, no national
union, and no political organization, they do not form a
class. They are consequently incapable of enforcing their
class interests ... They cannot represent themselves, they

must be represented.
Slaves, serfs, peasants could and often did revolt, burn

the big houses and kill lords, priests and lawyers. What they
could not do, except for short periods in exceptional
circumstances, was to impose their rule, as a class, on
society. Either the old rulers regained control or others took
their place. For the cultivators had sooner or later to
disperse to their plots or starve. Professional rulers arose to
represent them.
It is the concentration of the modern working class into

large units in cities and the enormous development of
means of communication that makes possible trade union
and political organization. They make it possible for the
working class, the great majority, to impose its collective
will on society. There is no possible substitute. Socialism
means a society based on voluntary cooperation between
working people. It can neither be established in the absence
of modern working class nor imposed on one from above.
Marx took as his model of working class rule the Paris

Commune of 1871. His description of its working is still, in
essentials, the outline of a workers state, though the rise
of large scale industry has made workers councils based on
productive units more important than area organization.
The Commune was formed of municipal councilors chosen
by universal suffrage ... responsible and recallable at short
terms. The majority of its members were naturally working
men ... The Commune was to be a working, not a
parliamentary body, executive and legislative at the same
time ... the police was at once stripped of its political
attributes and turned into the responsible and at all times
recallable agent of the Commune.
So were the officials of all other branches of the

administration. From the members of the Commune
downwards, the public service had to be done at workmens
wages. The vested interests and allowances of the high
dignitaries disappeared along with the high dignitaries
themselves ...Like the rest of public servants, magistrates
and judges were to be elective, responsible and recallable ...
The first decree of the Commune was the abolition of the
standing army and the substitution for it of the armed
people.
Such a revolutionary and democratic regime, solidly

based on the working class, is the essential instrument for
the transition to socialism. To establish it, of course, the
capitalist state machine must be eliminated because
workers power is incompatible with any kind of
bureaucratic and repressive hierarchy.
4. Who Produces the Wealth?

George Bernard Shaw once said, I dont need a theory of
value to tell me that the poor are exploited. He thought that
Marxist economic theory was an unnecessary piece of
armchair theorizing. It is a common point of view and is
often connected with the idea that Marxist economics is very
complicated, boring and hard to understand. Actually the
key ideas are easy enough to grasp once you understand
what they are intended to be used for. Every theory has a
purpose.
Marxs purpose in analyzing capitalism was first to show

how working people were exploited and second to discover
what he called the economic law of motion of the system.
The first point becomes clear when you consider other

systems of exploitation. The serf of the middle ages worked
part of the time on his own plot of land and also worked
two, three or four days a week on his lords land. He was not
paid for this, so it was obvious that part of the fruits of his
labour went to the lord. He was exploited.
Now the modern worker is paid for all the hours he puts
in. He may be underpaid by current standards but he does
not, apparently, have to put in a certain amount of time each
week without pay. How can he be exploited in the scientific
sense of having to work for nothing for the benefit of an
exploiting class?
Marxs labor theory of value explains how. First of all

capitalism is a system of commodity production. This means
simply that goods are produced for sale. What then decides
the relative prices of, say, TV sets and motor cars? Clearly it
has something to do with the fact that it costs more to make
a motor car than to make a TV set. Why does it cost more?
Marxs answer is that, the value of a commodity is
determined by the quantity of socially-necessary labour-
time required for its production. To put it crudely, the car
costs more because more work has to be put in to make it.
This idea did not originate with Marx. As a modern

economist put it, the labor theory is one of the most
powerful truisms in classical economics ... and it apparently
would have been still current with refinements, to be sure
among orthodox economists if Marx and some of his
forerunners had not put it to such effective use as the
touchstone of working-class ideology.
Marx himself introduced a number of refinements. For

example, socially necessary labor time means man-hours
put in using the current techniques of production. It would
cost a lot more labor-time to make cars by the methods
prevailing in 1900 than by those of today. But such cars, if
produced today, would not have a correspondingly high

value. They would have to be sold at current prices.
Of course different producers at any one time are using

equipment that is a little more or a little less advanced than
the average. It is the overall average that is taken as the
standard. It is also the case that the cost of the materials
that go in to the making of the car is greater than the cost of
those that go in to the TV set. But these materials are also
commodities and their value is determined in the same way.
The value of the end product includes the value of all

those items that have gone into its production. It is
determined by the total number of man-hours needed, on
the average, for the whole process of producing the end
product and everything that went into it, including the
necessary transport.
What has all this to do with exploitation? The crux of

the matter is this: the capitalist gains revenue by selling
commodities at prices which, as a first approximation, are
assumed to be close to their values.
The worker does not, generally speaking, have material

commodities to sell. He does have something to sell though:
he has his ability to work, his labor power. Wages are the
price of labor power and since labor power is also a
commodity, bought and sold like any other, it has its value.
The value of labor power is determined by the value of the
necessaries required to produce, develop, maintain and
perpetuate the laborer ... Wages so determined are,
the wage minimum.
Marx was well aware that wages were not necessarily

held at bare subsistence level. Besides this mere physical
element (i.e., what is necessary to keep the worker and his.
family alive and able to reproduce, DH), the value of labor-
power is, in every country, determined by a traditional

standard of life. It is not mere physical life, but it is the
satisfaction of certain wants springing from the social
conditions in which people are placed and reared. In short
the actual level of real wages depends, in part, on the
outcome of the class struggle. There is a floor below which
they cannot fall for long bare subsistence but above this
they can be pushed steadily upwards.
However, Marx believed that there were mechanisms in

the system to check and throw back increases in real wages.
These will be examined later. Meanwhile, it is worth noting
that real wages in Britain have risen very greatly in the last
century but that relative wages the share of wages in the
total national income have remained constant, at around
42 per cent, since 1870.
The difference between the value of the commodities

produced and the value of the labor power used in their
production and with a high productivity of labor it is a
very big difference indeed is called surplus value.
The surplus value belongs to the owners of the means of

production. It is the source of their income.
To sum up: provided that commodities, including labor

power, sell at prices close to their values, then the owners of
the means of production will receive, after allowing for
payment of raw materials, semi-finished goods,
depreciation and wages, an income, surplus value, that
actually represents the unpaid labor of their workers.
This is the source of exploitation under capitalism and it

is the best paid workers who will be the most exploited
because they are the most productive. Having established
this, Marx went on to consider the effects of changes in the
productivity of labour and in the distribution of its product

on the working of the system.
5. The Systems Driving Force

Modern capitalist society with its relations of production,
lull of exchange and of property, a society which has
conjured up such gigantic means of production and
exchange, is like the sorcerer who is no longer able to
control the powers of the nether world whom he has called
up by his spells ... It is enough to mention the commercial
crises that by their periodic returns put the existence of the
entire capitalist society on its trial, each time more
threateningly. Or do they?
At times the capitalist system has looked very much like

Marxs picture. At other times, and notably in the last 25
years, it has looked very different. It follows that either
Marxs analysis of capitalism is wrong in some important
respects or, as will be argued here, that the system does in
fact have the tendency to increasingly severe crises but that
this tendency has been modified by the action of certain
other factors.
Marx believed that there were two basic reasons making

economic crises inevitable under capitalism. First a periodic
tendency to produce more goods than could be sold
overproduction second a tendency for the rate of profit
to decline.
Imagine a capitalist society in which there is no

accumulation of capital. Each year the same quantity and
value of goods is produced. The techniques of production do
not change because inventions are not put to use. All the
goods produced are sold at their values. Marx called this
system simple reproduction. The total incomes goes, in
the first instance, to the capitalists. They have to purchase,

from one another, raw materials to replace those used in
production and have to replace the wear and tear on
buildings and machinery (fixed capital). Then they have to
pay wages. All the rest of the income represents surplus
value. It is the property of the capitalists and provided that
they spend all of it on consumer goods there can never be
any question of overproduction.
Now imagine, still under simple reproduction, that

some of the capitalists do not spend all their income. This
will immediately precipitate a crisis of overproduction.
These capitalists, having sold goods, no longer make the full
equivalent purchases. The result is a slump in demand and a
and a fall in the rate of profit. Such a system never did or
could exist. Yet it illustrates one of the central problems of
capitalism. There is no overall plan of production and yet
somehow or other, there has to be an invisible hand which
directs production and consumption in such a way as to
preserve an exact balance.
With the simple reproduction scheme this is not too

difficult. But this scheme ignores the central driving force of
the capitalist system the accumulation of capital.
Accumulate, accumulate, wrote Marx, this is Moses and
the prophets. The capitalist, individual or corporate, has no
choice in the matter. Competition compels each firm to
attempt to expand by re-investing a major part of the
surplus value available to it.
Surplus value is converted into capital. Some of it is

used to pay additional wages (variable capital), much of it is
used to obtain additional machinery and buildings (fixed
capital). Also it will be necessary to buy extra raw materials
and pay for extra depreciation. Marx lumped together all
these expenditures except wages under the heading of
constant capital. Accumulation means a rapid growth of the

constant capital employed in production.
This has a number of consequences, one of which is

especially important. Capital accumulation must, other
things being equal, drive up the demand for labor power.
The effect of this is summarized by the economist, P.M.
Sweezy: Now when the demand for any commodity
increases, its price also increases: and this entails a
deviation of price from value. We know that in the case of an
ordinary commodity, say cotton cloth, this will set certain
forces in motion to bring the price back into conformity with
its value: cotton cloth manufacturers will make abnormally
high profits, capitalists from outside will be induced to enter
the industry, the supply of cotton cloth will be expanded,
price will fall until it is once again equal to value and profits
are normal.
Having stated the general principle in this way we are

at once impressed by a striking fact: labor power is no
ordinary commodity. There are no capitalists who can turn
to producing labor power in case its price goes up; in fact
there is no labor power industry at all in the sense that
there is a cotton cloth industry ... In capitalism generally,
the equilibrating mechanism of supply and demand is
lacking in the case of labor power. Unless some offsetting
factors can be found, real wages must rise rapidly as capital
accumulation proceeds, and, as they rise, surplus value will
be eroded until finally nothing is left of it.
Various offsetting factors have been important in

practice. Immigration of labor on a massive scale has
existed at most times in the history of capitalism. Millions
and tens of millions of working men and women have been
drawn from underdeveloped areas into the capitalist
heartlands.
But most important is the substitution of dead labor

for living labor, the raising of the productivity of labor by
the use of more and more fixed capital per man. This
increase in what Marx called the organic composition of
capital is forced on the capitalists by the need to offset the
rise in the demand for labor power in the course of
accumulation. It has another important result. The rate of
profit the ratio of surplus value to total capital (constant
plus variable capital) must tend to decline as more and
more constant capital is employed unless there is always a
more than proportionate rise in the productivity of labor.
6. What Causes the Crisis?

The reasons for Marxs belief that periodic and increasingly
severe economic crises are inevitable under capitalism can
now be considered. The driving force of the system can be
summed up as a compulsion to accumulate capital.
Competition between capitalist concerns forces each

firm to attempt to expand its share of production by
converting surplus value into capital. This process of capital
accumulation tends to increase the demand for labor and so
to push up wages. To minimize wage costs more
sophisticated and expensive capital equipment is introduced
with the aim of increasing the productivity of each worker
and hence the amount of surplus value extracted. An
unwanted consequence of this increase in the amount of
fixed capital per worker or rise in the organic composition
of capital is a downward pressure on the rate of profit.
The immediate cause of slumps is not this long-term

tendency but short run fluctuations in the rate of profit. Of
course every actual slump has particular causes of its own
but certain general causes are always present.
In the course of a boom the demand for labor rises,

output increases and so does capital accumulation and
hence the demand for additional machinery and equipment.
Unemployment falls and as it shrinks so does the most
important check on rising wages. Earnings are pushed up
and so the rate of profit tends to be diminished. But as
soon as this diminution touches the point at which the
surplus value that nourishes capital is no longer supplied in
normal quantity, a reaction sets in: a smaller part of revenue
is capitalized, accumulation lags, and the movement of rise
in wages receives a check. (Marx).
The result is a recession, which is first felt in the heavy

industries making capital goods Department I as Marx
calls them. The loss of earnings of workers in this
department due to lay-offs, reduced overtime and so on
causes a fall in demand for the commodities that working
people buy and so spreads the recession to the sector of
industry making these goods. Marx calls this sector
Department II. The effect is cumulative and the
depression worsens. Whether or not wage rates are cut- and
typically they are actual earnings and hence demand falls
progressively.
Unemployment rises until the wage gains of the boom

have been cancelled out and the rate of profit starts to rise
again. A new boom is then in the making. This is a very
much simplified picture which leaves out a number of
features of importance, notably price fluctuations in the
boom-slump cycle. Nevertheless it represents the essence of
Marxs crisis theory. Before comparing it with the actual
history of capitalist development, three points have to be
considered.
The first is that though the crisis appears as a crisis of

overproduction, of falling demand, it is not demand as
such that is deficient. It is purchasing power. As Marx

wrote: The final cause of all real crises always remains the
poverty and restricted consumption of the masses as
compared to the tendency of capitalist production to
develop the productive forces in such a way that only the
absolute power of consumption of the entire society would
be their limit.
This fact is the basis of various reformist schemes that

seek, in one way or another, to prevent or alleviate slumps
by giving away purchasing power to workers. The
possibilities and limitations of these will be examined later.
The second point is why crises should tend to get worse

This is where the long term tendency for the rate of profit to
decline is important. To the extent that it is realized, it
lowers the profits ceiling, and so the space between that
ceiling and the floor created by working class resistance.
Thus, in the absence of offsetting factors, crises should
become ever more frequent and more severe. This is the
basic reason why Marx believed that wages could not
increase indefinitely in a capitalist society.
Finally there is the fact that there is a sector of

production, called by Marx Department III, that makes
neither wage goods for sale to workers nor capital goods
for accumulation. It includes both luxury goods for sale to
the rich and, more important, various goods for the state
which are, strictly speaking, not commodities in Marxs
sense at all, since they are not produced for a market.
This sector is relatively unaffected by the factors making

for boom and slump in Departments I and II. Its size is of
great importance in modifying the boom-slump cycle. How
does the theory measure up to reality? The liberal economist
Lord Beveridge concluded: Fluctuations of industrial
activity in Britain in periods of an average length not very

different from those of the modern trade cycle can be traced
over the whole time for which data of construction
industries are available, i.e. from 1785.
The average length of the cycle, on Beveridge figures, is

around 10 years. Clearly the boom-slump cycle is built into
capitalism. When the severity of the crisis is considered this
picture is modified. There was a general but uneven
tendency for crises to become more severe until the 1880s.
Thereafter slumps became milder until after the first world
war. The slumps of 1921, 1929 and 1938 were much more
severe than those of the 19th century, though that of 1938
was interrupted by the second world war.
Finally, since 1945 there have been a number of mild

recessions, none of which deserve the name of slump. These
facts have to be explained before it is possible to reach a
reasoned conclusion on the claim that the post-war
economic expansion proves that capitalism has been
drastically modified and is now slump free.
Three main features of the system that have not yet

been examined have a bearing of the issue. They are the
growth of monopoly and state monopoly capitalism, the
export of capital and the expansion of Department III
production.
Two of these have had, at various times, a medium run

stabilising influence on capitalist economies. None of them
can permanently stave off the systems inherent tendency to
crisis.
7. The March of the Giants

Robert Owen, in his earlier years, was a typical big capitalist
of the first half of the 19th century. He was a self-made man,
son of a small shopkeeper. Starting as a shop assistant he
became manager in a Manchester cotton spinning mill, then
a partner in the business and then, after only seven years,
owner of the largest spinning mill in the world, New Lanark.
The New Lanark Company was first a partnership and then
a one man business. Big as it was it produced only a small
fraction of the total output of cotton yarn. Owen had no
control over the prices he paid for yaw materials and
machinery, nor over the prices he could charge for his
products.
Impersonal market forces ensured that prices kept close

to values. No one capitalist could seriously affect them.
Competition ruled supreme and capitalists like Owen
obeyed the dictates of the invisible hand or went
bankrupt. This world of tens of thousands of competing
enterprises was the world of the economic theorists of all
schools, classical, Marxian and neo-classical. In fact the very
idea of an economic law depends on the assumption that
capitalists as well as workers are compelled to act in certain
ways by forces over which they have no control.
The United States Steel Corporation is a typical

capitalist of today. It is not a self-made man. It is not a man
at all but a vast complex organization. The men who control
its policies are wealthy but they do not own more than a tiny
fraction of the enterprise they control. The vast majority of
the owners the stockholders have about as much
influence on company policy as you or I.
Nor are actual controllers of US Steel in the same

position as Owen in respect to price policy. J.K. Galbraith
summarizes the situation as follows: The executives of the

US Steel Corporation, the longtime price leaders in the steel
industry, do have authority to raise and lower the prices
they charge for their own steel. When they exercise that
power the rest of the industry normally follows. The same
executives make decisions on where to build new plants and
how much plant to build, what to pay in dividends and,
subject to a periodic trial of strength with the union, what
wages to pay. They have latitude on all these matters; they
are not the automatons of market forces ... As with steel so
with the great core of American industry. And European
industry too.
A comparatively small number of giant firms, many of

them multi-national, dominate production and these giant
firms do more than simply respond to the market. They can,
and do, seriously influence it.
Now Marx, unlike the orthodox economists foresaw the

inevitability of competitive capitalism developing into
international monopoly capitalism. One capitalist always
kills many, he wrote. Hand in hand with this
centralization, or this expropriation of many capitalists by
few, develops ... the entanglement of all people in the net of
the world market and the international character of the
capitalist regime.
The fact remains that Marxs economic analysis assumes

effective competition between capitalists. Take that away
and the whole structure collapses. This point was first made
by the German Social-Democrat revisionist Edward
Bernstein. Bernstein drew attention to the simultaneous
growth of giant firms and cartels and the increasingly mild
character of the depressions in the late 19th and early 20th
centuries.
He looked forward to the growth of an increasingly

organized capitalism on a world scale which by planning
and control of markets could eliminate the systems
instability. He also pointed to the increasingly close
connections between the big firms and the state. The night
watchman state of the mid-19th century was giving way to
a state that was heavily involved in supporting and
regulatory activities in the economy, a development
particularly marked in his native Germany.
The same facts were noted by Lenin. This

transformation of competition into monopoly, he wrote in
1916, is one of the most important phenomena of modern
capitalist economy ... For Europe, the time when the new
capitalism definitely superseded the old can be established
with fair precision: it was the beginning of the 20th
century. A year later he was writing of the process of
transformation of monopoly capitalism into state monopoly
capitalism, of the state becoming merged more and more
with the all powerful capitalist combines.
Lenin drew the opposite conclusion from Bernstein.

Monopoly and state monopoly capitalism, he argued, are
not more but less stable than competitive capitalism.
Economic crisis and wars which Bernstein thought
organized capitalism would abolish will become more
frequent and severe. There is no doubt that the history of
the first half of the 20th century proved Bernstein wrong
and Lenin right. Whatever else it did, the growth of
monopoly did not ultimately stabilize the system. The
reason is clear. In Lenins words monopoly, which has
grown out of free competition, does not abolish the latter.
Though the giant firm is no longer a puppet of the market it
is engaged in a constant struggle with other giant firms to
amass more and more surplus value to expand its capital.
The penalty for failure is no longer bankruptcy big

firms rarely go bankrupt it is takeover. The controllers of
the big combines have great power but not the power to opt
out of this struggle. Competition is reproduced on a higher
level and because of this Marxs analysis is still relevant.
Why then did the growth of monopoly coincide with a
lessening of slumps? Lenins explanation, the export of
capital, has now to be examined.
8. The White Mans Burden

In 1870 most of Africa was still ruled by Africans. By 1914
the continent had been almost completely carved up by the
European powers. Only the US puppet state of Liberia and
the precariously independent Kingdom of Ethiopia survived.
In Asia the remaining independent states were either
conquered like Burma or effectively partitioned into
spheres of influence by the great powers as in the case of
China. Such nominal independence as remained to states
like Iran or Turkey was due entirely to the conflicts between
their would be conquerors. So too with Oceania and South
America. The powers of Europe and North America ruled
almost the whole world. These were the peak years of
imperialism in ideology as well as in fact, the years of
Kiplings white mans burden, of Tafts manifest destiny,
of Rhodes I would annex the planets it I could.
They were also the years in which European and US

capitalism was undergoing profound structural changes.
Laissez-faire capitalism was giving way to monopoly
capitalism. In Germany by 1914 less than one-hundredth of
the total enterprises utilize more than three-fourths of the
steam and electric power ... small enterprises, representing
91 per cent of the total, utilize only 7 per cent of the steam
and electric power.
In the USA, John Moody in 1904 cited 318 trusts, most

of them formed after 1898, as evidence that control of
business and capital was rapidly concentrating into fewer
and fewer hands. Similarly, though in varying degrees, with
every capitalist society, Marxs prediction that one
capitalist always kills many was coming true with a
vengeance.
That these facts were connected with one another was

the essential argument of Lenins theory of imperialism.
Under modern capitalism, when monopolies prevail, the
export of capital has become the typical feature. In order to
safeguard the investments of their ruling classes the
governments of the imperialist powers were forced to
impose direct foreign rule over the backward countries.
Other factors driving them in the same direction were the
struggles for control of raw materials and for markets
protected against competitors. But monopoly and the export
of capital were the key features.
The evidence for Lenins case was impressive and at the

time it was written it undoubtedly had a large measure of
truth. Take the case of Britain. The pioneer investigator of
British imperialism, J.A. Hobson, showed that British
foreign and colonial investments increased from 1883 to
1893 at the rate of 74 per cent per annum. In 1899 the
profits on these investments totaled between 90 and 100
millions sterling; in 1909 they had risen to 140 millions
and in 1915 to about 200 millions, that is to about a
quarter of the income of the upper and middle classes, since
total incomes subject to tax were about 900 million.
The same tendency was, in varying degrees, present in

all the imperialist countries. The relative stability of late
Victorian and Edwardian capitalism rested upon this export
of capital. A way had been found of alleviating the inherent

instability of the system for a time and at a terrible price.
In purely economic terms the problem for the capitalist

class is that accumulation of capital, which is forced on each
capitalist concern by its competitors, drives up the demand
for labor power and hence its price wages. This in turn
eats into the surplus value and the resulting erosion of the
rate of profit checks accumulation and precipitates
recession. Unless, of course, the connection between
accumulation and the rising demand for labor power can be
broken. This is exactly what the export of capital to
backward areas helped to achieve from about 1880
onwards.
The Indian jute mill workers, the African miners, the

Chinese cotton spinners could be and were paid even less
than the historically determined price of their labor
power. With the disruption by capitalism of the traditional
precapitalist economies, a great mass of pauperized labor
was available in the colonial and semi-colonial world. Hence
the super-profits of imperialism. And if the natives are
restless, the whole force of the imperialist power is
available to prevent them obtaining even the most
elementary democratic rights.
No socialist agitator ever expressed the essence of

imperialist politics better than the US Major-General
Smedley D Butler: I spent 33 years and four months in
active service as a member of our countrys most agile
military force the Marine Corps ... And during that period
I spent most of my time as a high class muscle man for Big
Business, for Wall Street, and for the bankers. In short I was
a racketeer for capitalism ... Thus I helped to make Mexico
safe for American oil interests in 1914. I helped to make
Haiti and Cuba a decent place for the National City Bank
boys to collect revenues in ... I helped to purify Nicaragua

for the international banking house of Brown Brothers in
1909-12. I bought light to the Dominican Republic for
American sugar interests in 1916. I helped to make
Honduras right for the American fruit companies in 1903.
In China in 1927, I helped to see to it that Standard Oil went
its way unmolested.
The price of imperialism was paid by the super-

exploited workers and peasants of the colonial world. It was
also paid, contrary to Lenins view, by the workers of the
developed capitalist countries. Again, taking Britain as the
example, real wages rose irregularly but considerably until
the middle 1890s. From 1896 to 1900 they were fairly
steady. Thereafter they began to fall. Between 1899 and
1913 real wages actually declined, by about 10 per cent. The
export of capital was taking its toll.
A far greater price was required. In 1914 the rivalries

and conflicts of the great robber powers exploded into the
greatest organised slaughter the world had yet seen. Tens of
millions of working men fought for their masters. Millions
died. The high noon of capitalism was over, the century of
wars and revolution had begun.
9. Modern Capitalism
By 1968 the free worlds economy will be dominated by
some 300 large companies, responsible for most of the
industrial output ... It is possible that 200 out of the 300
mentioned ... will be American ... Already the rise in the
USA share of international companies is overwhelming.
Before the war foreign investments of companies engaged in
international business was 15,000 million dollars. Now it is
100,000 million dollars and is still rising. The total book
value of the foreign investments of USA companies in
overseas affiliates amounts to about 60 per cent of the

total. This is not an extract from an updated version of New
Data for Lenins Imperialism. It is quoted from a speech
made in Jerusalem in 1969 by Mr Peter Parker, Chairman of
Bookers, one of the household names of British colonial
enterprise.
Imperialism is still with us. It still blights the lives of the

majority of the worlds people. It is still responsible for
numerous dirty wars, of which Vietnam is only the biggest,
bloodiest and best known. From the Congo in 1960 to
Muscat and Oman in 1970, the imperialist powers still
intervene in the interests of the international profiteers. All
that has changed, at first sight, is the ideology. We have
progressed from the white mans burden to defense of the
free world.
And yet there have been real changes since Lenins day.
One of the key points in Lenins theory was the
overwhelming importance of the export of capital from the
developed capitalist countries to the third world.
Another was the corruption of the labor aristocracy in the
west by the crumbs from the superprofits of imperialism.
This, in Lenins view, was the real basis of the Labor and
Social Democratic leaderships abandonment of socialism
and the class struggle. Later theorists have carried this idea
further and argued that not just a labor aristocracy but the
entire working class of the developed countries have been
bought off by imperialism.
The developed countries succeeded in exporting their

internal problems and transferring the conflict between rich
and poor from the national to the international stage,
writes Kwame Nkrumah. When Africa becomes
economically free and politically united, the monopolists
will come face to face with the working class in their own
countries, and a new struggle will arise within which the

liquidation and collapse of imperialism will be complete.
In fact neither the export of capital nor the

superprofits of imperialism play the role they once did.
The export of capital from advanced to backward areas,
a major stabilizing influence on capitalism in the late 19th
and early 20th centuries, is now relatively unimportant.
Certainly it is far too small to account for the profound
modification of the boom-slump cycle that has been so
marked in the last 20 years.
In the case of Britain, the largest capital exporter in

1914, the significance of capital exports has declined
enormously: latterly they have been running at slightly over
2 per cent of gross national product compared with 8 per
cent in the period before World War I, they now absorb less
than 10 per cent of savings compared with some 50 per cent
before, and returns on foreign investments have been
running slightly over 2 per cent of national income
compared with 4 per cent in the 1880s, 7 per cent in 1907
and 10 per cent in 1914.
Between 1895 and 1913, 61 per cent of all new capital

issues were on overseas account, by 1938 they were down to
30 per cent and more recently accounted for no more than
20 per cent of the total. True the decline in British overseas
investment has gone hand in hand with an increase in that
of the USA. In 1914 the UK had 50 per cent of all foreign
investment arid the USA 6 per cent. In 1960 the proportions
were: UK, 24 per cent, USA, 59 per cent. In spite of this
the total flow of capital exports from Europe and the USA to
the third world is relatively small. In fact, if the oil
industry is excluded, it is arguable that there has been
no net capital export at all for long periods in the recent
past.
Nor is this picture much modified if aid is taken into

account. Such aid is estimated on the annual average to
have amounted to 6,000 million dollars between 1960 and
1962. But the sums taken out of the aided countries by
donors in a sample year 1961 are estimated at 5,000 million
dollars in profits. Export of capital plays a vital role in
modern capitalism but it is, overwhelmingly, export from
one developed country to another. Its economic significance
is thus entirely different.
It cannot be a major factor in permitting the growth of

capital accumulation whilst offsetting the rising demand for
labor power. It cannot account for the corruption, either of
labor aristocracies or of whole working classes by the
crumbs of superprofits. These parts of Lenins theory had
relevance in 1920. They have very little today.
The inherent instability of capitalism is not mainly

offset by capital exports today and has not been so offset
since World War I. The great slump of 1929-1932 is proof
enough of that. To understand the great expansion of
capitalist production since World War II it is necessary to
examine the expansion of that part of the total output which
consists neither of wage goods nor of capital goods.
10. Arms: Key to Postwar Recovery

On Thursday 24 October 1929, Black Thursday, the
American stock market collapsed. It was the signal for the
greatest economic crises in the history of capitalism so far.
After the great (Wall Street) crash came the great
depression. In 1933, the US gross national product (total
production of the economy) was nearly a third less than in
1929. Not until 1937 did the physical volume of production
recover to the levels of 1929, and then it promptly slipped
back again.
Until 1941 the dollar value of production remained below

1929. Between 1930 and 1940 only once, in 1937, did the
average number unemployed during the year drop below
eight million. In 1933 nearly 13 million were out of work, or
about one in every four of the labor force. In 1938 one
person in five was still out of work. In Britain, in Germany,
in every developed monopoly capitalist country the situation
was similar. Marxs prediction that capitalist crises would
become more and more severe seemed to have been proved
in practice. The revisionist and liberal arguments that
organized, i.e. monopoly, capitalism would eliminate
crises were shattered. The result could have been socialist
revolutions in the developed capitalist countries.
In fact, due mainly to the tragic degeneration of the

Communist Parties, at that time the only possible source of
revolutionary leadership, it was defeat and demoralization
for the working classes, fascism and finally another world
war. Most Marxists believed that, after that war, a post war
boom would be followed by an even bigger and more
terrible slump. It has not yet happened. Instead there has
been a tremendous expansion of capitalist production,
checked only by one or two mild recessions. True, this has
gone hand in hand with the continuing and perhaps growing
impoverishment of the Third World.
The fact remains that in the areas of working class

concentration, the advanced capitalist countries, the system
was stabilized. That this stabilization was temporary and is
now beginning to crumble away is the crux of Marxist
analysis of contemporary capitalism. To understand why we
have to grasp the real causes of the long boom.
Several supposed causes can be disposed of quickly. First,

the argument that the tremendous destruction of the Second
World War and the need to rebuild the productive forces are
mainly responsible. It seems incredible that anyone should

believe this in 1970 but some, apparently, still do. Now the
war has been over for 25 years. Actually there was a post-
war boom, due mainly to this cause, between 1945 and 1949.
Then a recession began, most clearly marked in the USA. It
was short-lived.
In 1950 the Korean war began and with it a new boom. And
it is the years since 1950 that have seen the really
sensational economic growth. The extent of the growth is
often underestimated. It was, in fact, unprecedented. The
system has never grown so fast for so long as since the war
twice as fast between 1950 and 1964 as between 1913 and,
and 1950 and nearly half as fast again as during the
generation before that.
A popular idea is that it is new inventions, technological.

progress that cause this economic expansion. The rate of
technological change is now greater than at any time in the
whole course of human history. So naturally growth is faster
and slumps virtually disappear. This argument misses the,
fundamental point that under capitalism production is not
for use but for profit. Capital is invested if there is a good
expectation of profit and not otherwise, no matter how
useful a new product might be to people. There was, after
all, no lack of useful inventions awaiting development in
1930. Television is a good example. As the scientist J.D.
Bernal pointed out, the development of television was slow
not because its principles were not grasped at an early date
(Campbell Swintons proposals on essentially the same lines
as are now used were made in 1911) and not because of the
technical difficulties ... It lagged essentially because the key
electrical firms ... were too intent on immediate profits to
indulge in expensive development. In fact the connection
between the boom and technological progress is the
opposite of that usually supposed. It is the existence of the
boom that makes it profitable to invest in new products

rather than the other way round.
Another popular misconception is that the state planning

and management that are a feature of every modern
capitalist economy are the explanation. This is, of course,
the reformist view. Now state intervention in the economy is
important, state expenditure is enormously important but
planning and management only work so long as they
go with the grain of the system. Look at the Labor
Governments famous National Plan. When the economic
climate changed it sank without a trace. There have been
many other examples of the same kind. Perhaps the most
important Was the American New Deal of the 1930s. This
was state intervention on a really massive scale. It had a
number of effects but one effect it did not have was the one
it was intended to achieve. It did not end the slump.
What did end the slump, in Europe as well as in the USA

was armament production. There can be absolutely no
doubt about this. John Strachey wrote in A Programme for
Progress: The seven years from 1930 to 1937 included
(1931-32) two of extreme depression and five of recovery.
But that recovery ended in the first half of 1937. In the
autumn of that year a new slump occurred. Unemployment
rose by three-quarters of a million in Britain. In America it
rose by four million in nine months. All the indices show
that the new slump was not merely as severe as, but much
more severe than, the great slump of 1929 ... The slump was
stopped in mid-career ... Nor was there the slightest doubt
... as to the cause of this unprecedented even t... It was the
direct consequence of the fact that the British government
was spending 700 million a year on armaments. And
similarly, a little later, in the USA.
It is state expenditure then, and not planning as such that

overcomes crisis. And, as will be shown, not just any
expenditure but, crucially, armament expenditure. The
importance of this Department III output is the key. It is
this that has sustained the long boom. The reasons why it
cannot go on doing so indefinitely can now be examined.
11. The End of Postwar Stability

In 1962 the united nations published a survey which showed
that about 43,000 million a year was being spent on arms.
This was nearly a tenth of the total world output of all goods
and services and was roughly equal to the value of all
exports from all countries.
Still more important arms expenditure corresponded to

about one half of gross capital formation throughout the
world (M. Kidron: Western Capitalism since the War,
Penguin). This huge expenditure is largely concentrated in
the capital goods industries Marxs Department I, the
very sector of the economy most sensitive to economic
fluctuations. A US government report issued in 1965
summarized the effect: The greatly enlarged public sector
since World War II, resulting from heavy defence
expenditures, has provided additional protection against
depressions, since this sector is not responsive to
contraction in the private sector and provides a sort of
buffer or balance wheel in the economy (my italics).
Writing during the great depression of the 1930s, the

economist Keynes ironically proposed a cure: If the
Treasury were to fill old bottles with banknotes, bury them
at suitable depths in disused coal mines which are then
filled up to the surface with town rubbish, and leave it to
private enterprise on the well-tried principles of laissez-faire
to dig the notes up again (the right to do so being obtained,
of course, by tendering for the leases of the note-bearing

territory), there need be no more unemployment and, with
the help of the repercussions, the real income of the
community, and its capital wealth also; would probably
become a good deal greater than it actually is.
This is what has actually happened. Military expenditure

corresponds exactly, from the economic point of view, to the
mining of buried banknotes. The permanent arms economy
is practically applied Keynesianism. But why military
expenditure? Keynes himself remarked: It would, indeed,
be more sensible to build houses and the like. What
prevents the replacement of the irrational and dangerous
production of armaments by socially useful expenditure?
Why not abolish poverty?
There are a number of reasons. The famous Report from

Iron Mountain emphasized one: As an economic substitute
for war it is inadequate because it would be far too cheap ...
the maximum programme that could be physically effected
... could approach the established level of military spending
only for a limited time in our opinion ... less than 10 years.
In this short period, at any rate, the major goals of the
programme would have been achieved. Its capital
investment phase would have been completed ... There is a
more fundamental difficulty. Production under capitalism is
production for profit by competing enterprises. If some are
more heavily burdened with social expenditure than
others, they will, other things being equal, be at a
competitive disadvantage.
The great advantage of arms spending from a capitalist

point of view is that equivalent spending is forced on
competitors. A rough equality of sacrifice is imposed by
the arms race itself. It was never more than a rough
equality. In the countries of western capitalism military
expenditure ... has ranged ... as a proportion of gross

domestic fixed capital formation from nearly 60 per cent in
the US to 12 per cent in Norway (Britain 42 per cent).
The real difference is rather less than the figures suggest

because the use of the dollar as the international currency
has enabled the US to maintain a near permanent balance of
payments deficit: that is to say the rest of the world has been
giving the US a near permanent subsidy. Still, the inequality
of the arms burden is a growing problem. Japanese
industry, for example, has expanded enormously during the
arms boom much more proportionately than US or British
industry because it enjoys the benefits of the boom
without having, to bear more than a small fraction of its
cost. This is one of the factors that is now undermining the
long stabilization.
Another is the increasingly capital-intensive nature of

military production. Tank production requires a lot of
capital plus a large amount of skilled and semi-skilled labor.
Inter-Continental Ballistic missile production requires an
enormous mass of capital plus a relatively small amount of
highly skilled labor. Hence the creeping rise in
unemployment that is occurring throughout the West. the
balance wheel is beginning to wobble.
Yet this rising unemployment goes hand in hand wit an

accelerating inflation. Some degree of inflation is inevitable
under monopoly capitalism in the absence of big slumps.
From the late 1940s to the late 1960s prices have been rising
everywhere in the West by an average of 2 per cent to 3 per
cent a year. A high demand for labor-power is bound to
drive up prices and wages and the increases are passed on
or more than passed on.
What is happening now is quite new. Prices are increasing at

an unprecedented rate at the same time as the demand for
labor-power is slowly declining. Part of the explanation is
the US Anti-Ballistic Missile Programme, the most
expensive arms programme in history, which is spreading
inflationary pressure throughout the system by creating a
huge demand for certain kinds of scarce resources without
making the corresponding demand for labor.
Another source of instability is the growth of huge

international firms which can and do shift vast resources
from one country to another. The tendency is to concentrate
capital accumulation in a rather small number of highly
developed areas giving a further upward twist to inflation,
while running down development elsewhere giving an
upward twist to unemployment. The development of an
uncontrolled credit system the Euro-currency market is
yet another force sapping the foundations of Western
capitalist stabilization.
History never repeats itself exactly. There will never be

another 1929. Yet the instability of the capitalist system i;
reasserting itself. The long stabilization is ending. [1*]
12. Ideas: How the Ruling Class

Keeps its Grip
A famous nineteenth century hymn, All things bright and
beautiful, which is still sung in schools contains the verse,
The rich man in his castle, the poor man at his gate, God
gave each his station and ordered his estate.
Not too many people believe in that kind of divine

providence nowadays, at any rate not in the industrialized
countries. And yet, in Britain in 1970, millions of working
people voted for the Conservative Party.
Nor was this a freak result. In a country with universal

suffrage, where 80 per cent of the working population
consists of manual and routine white collar workers (1961
census), the Conservatives have been in power for 34 years
out of the last 50. The Conservative Party exists to protect
and extend the interests of that 10 per cent of the population
that owns 80 per cent of all private property. How is it
possible for a such a party to win elections. The answer is
clear enough at one level. Millions of people do not
understand their own interests. They have a false picture of
the society they live in.
What has to be explained is why this is so. The puzzle of the

Tory working man is only a fraction of the problem. A larger
section of the working class more or less regularly votes
Labor and votes for a party that has proved, in practice, that
it too is committed to the preservation of the capitalist
system, to privilege and inequality. And though most people
might not put it in those terms, they understand well
enough that there is no fundamental difference between the
parties on this score.
This is not a new problem. Throughout history, societies

have been run in the interests of the rich and the mass has
been persuaded, in one way or another, to put up with this
state of affairs for most of the time. Persuaded is the
operative word. Riling classes have always. had soldiers and
policemen, or their equivalent, at their disposal. Without
them, that is without actual or potential violence, they could
not rule at all. But, except at times of great crisis, violence is
less important than persuasion.
For a class society to exist, both rulers and ruled have to

have fairly coherent world outlooks that justify the existing
set-up or make it seem the only possible sort of
arrangement. They have to have what Marx called
ideologies. An ideology is not just a wrong belief. It is a

whole system of ideas which takes into account a good
many facts but which shows the connection between those
facts in a false light. Marx described ideology as false
consciousness.
It is impossible for a privileged class to hold down the mass

of a population for long unless the various sections of that
population have a false consciousness. Moreover, the rulers
themselves need an ideology. Once they have lost their
belief in their own unique fitness to rule they become mere
gangsters like the Batista clique in Cuba and then they
are well on the way to destruction.
Until recently most ideologies have taken the form of

religions. The various kinds of Christianity are most familiar
to us and it is convenient to look at Christianity in order to
get an idea of the main features of ideology in general. First
of all the facts and their interconnection. According to
Genesis, God created man in his own image. Man and God
(in mens consciousness) were facts. The relationship
between them however is inverted. Man created God
in his own image and naturally the conception of the deity
changed as social conditions changed. In our Bibles he
progresses from Jahweh, the bloodthirsty tribal superchief
to Our Father, the omnipotent and benevolent ruler of
Heaven and Earth the idealized counterpart of the
omnipotent and not-so-benevolent Roman Emperor.
The Emperor is remote and unapproachable. It is his local

agents that have to be bribed or persuaded in matters of
everyday concern. And so the Christian God is soon
surrounded by a host of saints and martyrs who become the
actual objects of prayer and devotion.
The whole conception is wrong of course, but it is not simply

a fantasy. It corresponds, in a distorted way, to the real
world that the religious lived in. It is also, like every long-
lived ideology, a complicated and partly contradictory
system accommodating many different strands of thought.
Marx is often quoted as saying Religion is the opium of the
people. What he actually said is rather more complex.
Religion is the sigh of the oppressed creature, the heart of a
heartless world, the spirit of unspiritual conditions. It is the
opium of the people.
So we have, on the one hand, render unto Caesar the things

that are Caesars but, on the other hand lay not up for
yourselves treasures upon earth, where moth and rust doth
corrupt ... Ye cannot serve God and mammon.
We are told that my kingdom is not of this world and at

the same time And again, I say unto you, it is easier for a
camel to go through the eye of a needle, than for a rich man
to enter into the kingdom of God. The poor are urged to
submit to the tribulations of this world but are promised
Blessed be ye poor ample compensation in the world to
come.
It is easy today, in a scientific world, to underestimate the

power and resilience of religious ideology in the past. It
provided an explanation of the workings of the universe,
consolation for the masses of the people, justification for
their rulers, entertainment, codes of conduct and an
ultimate purpose in life. It has been slowly dying in the
industrialized centers for a century and a half but is still far
from extinct.
Secular ideologies have largely replaced religion as the

effective world view in industrialized areas, even amongst
many people with church affiliations. The most important of
these patriotism and democracy are promoted by the

mass media and the education system. Yet they are not
simply systems of ideas produced by ruling class
intellectuals for mass consumption. They create a real echo
in the consciousness of working people because they
incorporate some facts of everyday experience.
13. Greedy Workers

Mr Anthony Barber said recently that We cannot allow the
trade unions to hold the nation up to ransom. Just what is
this nation? Car workers, dustmen, miners, power
workers and postmen together with their families are
presumably part of it. As a matter of fact they, with their
fellow workers in other industries and trades and their
families, make up a big majority of the people living in
Britain. Are they holding themselves up to ransom?
Of course, Mr Barber, whose concern for the old, the sick

and the poor was reflected in his recent Budget, means to
give the impression that groups of greedy workers are
exploiting their strength to get exorbitant wages at the
expense of old-age pensioners, the chronically sick, widows,
orphans and other unfortunates.
The reality is very different. It was the Tory politician

Disraeli who coined the phrase The Two Nations to
describe the rich and the rest of us. Todays Tories are less
candid but the two nations are still a fact. Around 10 per
cent of the population own about 80 per cent of all private
property. Some of the 10 per cent are only moderately well
off. The really rich dominate property ownership in Britain.
Professor J.E. Meade showed, in a book published in 1964,

that the richest 5 per cent of the population owned 75 per
cent of all personal wealth in 1960. If we take shareholding,
the most important source of unearned income, we find that

just over 1 per cent of the population owns 80 per cent of all
share capital and the great bulk of the remainder is owned
by another 9 per cent.
As with property ownership, so with income. Marxists

distinguish between personal property a suit of clothes, a
car which does not produce income and property in the
means of production (nowadays mostly in the form of
shares) which does. All wealth is produced by work. Shares
are a legal title to a portion of the wealth produced by others
by workers. The interests of the class that produces the
wealth, working people, and the class that controls the
surplus value, the capitalists, are directly opposed to each
other. If the workers collectively get a larger share, in real
terms, of what is produced then the capitalists, get less and
vice versa. It is as simple as that.
The national interest, then is a fake. There are

only class interests. The real interests of working people in
Britain are the same as those of working people in Germany,
Japan or the USA. The slogan Working people of all
countries unite expresses both the reality of common
interests and the necessity for workers to recognize and act
on those common interests to free themselves and the rest
of humanity.
Nationalism is an ideology, a false consciousness which

enables the ruling classes to control the people they exploit.
But like all influential ideologies it incorporates some facts.
National differences, in language, in history, in customs, are
a fact. So too are differences in the standard of living in
various countries. It is these indisputable facts that make it
possible for the head-fixing industries controlled by the
various ruling classes education, TV, radio, the press and
so on to play on the differences so that the bosses can

divide and rule.
Nevertheless socialists cannot regard all nationalisms as

equally reactionary. There is all the difference in the world
between the nationalism of a colonial or semi-colonial
country, whose workers are doubly exploited, and that of an
imperialist power like Britain. The right of every people to
self-determination has to be recognized. No nation, wrote
Marx, that oppresses another can itself be free. The poison
of imperialist ideas, of which racialism is the most extreme
form, helps to paralyze the workers of the imperialist
countries in their own struggles.
The peoples of the British Isles have genuine national

traditions: the traditions to go back no further than the
industrial revolution of the English and Scottish Jacobins,
of the Chartists, of the pioneers of free speech and trade
unionism, of the heroic fighters for Irish republicanism. The
struggle for democracy is central to our tradition. Every
single democratic right we enjoy today, free speech, the
right to organize, even the right to dissent from the state
religion, has been won by working men in the teeth of
violent opposition from the ruling class. Immense sacrifices
were necessary to achieve them and immense sacrifices will
be necessary to defend and extend them. There is no final
victory short of socialism. We do not have democracy in
Britain today though we do have vitally important
democratic rights.
At one time the fight for the right to vote was the central
issue and many thought it would, if won, destroy class rule
and exploitation. Bronterre OBrien, the Chartist leader,
believed: Universal suffrage means a complete mastery, by
all the people, over all the laws, and institutions in the
country ... General suffrage would place the magistracy and
parliament and consequently the disposal of the military

and police forces in the hands of the entire body of the
people. Universal suffrage was actually won in 1928. It has
real, if limited, value. It has not achieved what the Chartists
hoped for and the reason takes us to the heart of the
problem of ideology. The forms of democratic rule are quite
compatible with the reality of rule by a small governing
class, on one condition.
The condition is that the mass of the population have a false

view of the world and, in particular, that the working class
as a whole is not yet what Marx called a class for itself. In
other words it has not yet come to understand its objective
interests and looks at society through the spectacles of
ruling Class ideology, of national interest and the rest.
This state of affairs cannot be changed simply by education

and propaganda, necessary as these are. It can only be
changed by activity, by that actual struggle for immediate
aims which produces self-education. In Marxs words, The
coincidence of the changing of circumstances and of human
activity can be conceived and rationally understood only
as revolutionary practice.
14. The Public Interest: Dust in

Workers Eyes
The country cant afford it. It can be anything from free
milk for school children to decent pay for postmen. Now
the country is, strictly speaking, a geographical
expression. Of course people who talk like this do not really
mean a collection of islands in the North Sea cant afford
it. If pressed, they will probably admit that what they mean
is that the people living in these islands cant afford it. Put
in that way the statement is much less effective because it is
obvious that we are talking about how to share out available
income among these people. The trick is to give the

impression that there is something called the country
which is somehow different from the actual people who live
in it.
Words like the economy, sterling and the public

interest are used in the same way. The intention is to throw
dust in peoples eyes to prevent them thinking about the real
issues. It is often very effective. Words can be weapons and
if people can be made to think in terms of these big
abstractions it is very much easier to mislead them. Marx
called this type of thinking fetishism. A fetish, according
to the Oxford dictionary, is an inanimate object
worshipped by savages as having magical powers or as being
animated by a spirit. The natives of West Africa used to
make wooden models of fantastic animals which they
believed had real minds and powers of their own.
Illusions of this sort are by no means confined to primitive

people. They are an important part of capitalist ideology. To
pay homage to something called the strength of sterling is
no more and no less rational than to pay homage to
monkey-headed crocodile. Fetishism means assuming that
things have interests of their own and that society can be
seen mainly as a relationship between people and things
rather than between people and people. In the mist-
enveloped regions of the religious world ... the productions
of the human brain appear as independent beings endowed
with life, and entering into relations both with one another
and with the human race, wrote Marx. So it is in the world
of commodities with the products of mans hands. This I call
Fetishism ...
The strength of sterling is a good example of a modern

fetish. What actually does it mean? Ask an economist and
you will be told that if sterling is strong people will prefer to
hold it rather than, say, dollars. But what people and why?
Clearly not the mass of working people in this country. In
fact most shops and pubs will not accept dollars anyway, so
that whether sterling is weak or strong most of us have to
hold and use it regardless. The economist will probably
brush aside this objection as frivolous. The people he has
in mind, he will explain, are bankers, brokers and
international currency speculators.
Now they are not a very big group. Why do their preferences
matter so much? If our economist is very patient he will tell
us that if these bankers and speculators think that sterling is
not a sound currency they will convert their holdings into
dollars or Swiss francs and this will upset our balance of
payments. In short these people have great power. But it is
not power over pieces of paper or entries into bank ledgers.
It is power over other people specifically over working
people. The paper and the entries are only tokens of that
power.
Having got so far we are well on the way to asking why on

earth the working people of this or any other country should
tolerate a state of affairs in which a handful of speculators
can exercise such power. It is not a convenient question for
the rich, which is why the mass media conjure up fetishes
like the strength of sterling. Recently a daily newspaper
had on the same front page a headline, Sterling Has Never
Been Stronger and another saying Wage Claims Threaten
Economy!
An American political scientist described politics as being

about Who gets what, when and how. It is a good.
shorthand way of describing economics too. Every economic
problem is really about relations between people, people
who work and people who get a lot of the proceeds without
working. The job of the mass media, and of much of
education from infant school onwards, is to prevent

people from seeing this obvious fact. In the words of the
English revolutionary poet Shelley: Around your face a web
of lies is woven.
There are limits to the power of the mass media. It is quite

easy for them to persuade most of their audience that the
rulers of Bongoland are a vicious, anti-British lot, even if it
isnt true. Bongoland is far away. It is very hard for them to
persuade people to disregard facts within their own
experience. Successful propaganda public relations is
the term favored nowadays is based on some facts well
known to the audience. These are then fitted in the story
that the company or the government wishes to have
believed. Very large sums of money are spent on attitude
research for this reason.
Attitudes are not fixed and unalterable. People are heavily

influenced by the opinions of the group they work in. The
role of the militants is very important in developing
resistance to media manipulation. Incidentally this is why
women, taken as a whole are more conservative than men. A
much larger proportion of them are isolated from working
groups and so more vulnerable to the head-fixers. It has
nothing to do with sex as such.
Activity is the most important single factor in changing

consciousness. In changing the world men change
themselves. People are not passive instruments like radio
receivers. Their actions and their thinking are aspects of a
single process. Thought influences action but action also
influences thought. Fetishism and ideology can be overcome
by the combination of class activity and socialist ideas.
15. European Revolution Defeated

On 4 August 19114 the long predicted war between the
imperialist powers broke out. It was a war for colonies, for
spheres of influence, for markets, in short for profits. That
war shattered the international socialist movement. The
leaders of the big social democratic parties forgot about
Marxism and internationalism and capitulated to their
own governments.
Four years earlier, at the International Socialist Congress in

Copenhagen, they had reaffirmed a resolution which said
that it was the duty of socialists to prevent the outbreak of
war by all possible means but should war nevertheless
break out, their duty is to intervene to bring it promptly to
an end, arid with all their energies to use the political and
economic crisis created by the war to rouse the populace
from its slumbers, and to hasten the fall of capitalist
domination. Instead they entered coalition governments to
help the war effort.
In fact the betrayal was not as sudden as it seemed. For a

good many years the social democratic leaderships had
been adapting themselves to imperialism and parliamentary
politics. They continued to talk about the class war at May
Day rallies but their day-to-day political practice was purely
reformist. The possibility of peaceful, constitutional roads to
socialism seemed to open up. They led to the unprecedented
slaughter of 1914-18.
In every country the movement split between the renegades

and the internationalists and, as the war dragged on,
revolutionary opposition began to grow. It was in Russia
that the break came. In February 1917 mass strikes and
demonstrations by the workers of Petrograd overthrew the
Tsar. Eight months later a revolutionary working class party
was able to brush aside the pro-war Provisional

government and seize power.
The Russian revolution was the most important event in the

history of the workers movement. Everything that has
happened since has been influenced by it, often decisively.
No one can understand the world today without an
understanding of that revolution and its outcome.
Russia at the time of the revolution was a backward country,

a country with a weak industrial base and a relatively small
working class some five million workers out of a
population of 160 million in 1914. The material basis for
socialism a well developed industry and a high
productivity of labor did not then exist in Russia. Still less
did it exist after the years of war, civil war, blockade and
foreign intervention. The armies of 14 capitalist countries
including Britain fought alongside the western armed and
financed Tsarist generals to overthrow the revolution. They
were defeated. The revolution won but at a terrible cost.
The already weak industry of the country was practically

destroyed and the working class dispersed. By 1921 the
number of industrial workers in Russia had fallen to 1
million. Petrograd had lost 57.5 per cent of its total
population. The communist leaders had never supposed
that it was possible to build socialism in an isolated Russia.
Lenin said in 1918: The complete victory of socialism in one
country alone is inconceivable and demands the most active
co-operation of at least several advanced countries, which
do not include Russia. The Russian revolution was seen as
part of an international revolutionary movement that would
establish working-class rule in some, at least, of the
advanced countries.
There was such a movement. Revolutionary Soviet regimes

were actually established in Hungary, in Bavaria, in Finland
and in Latvia. The German Kaiser, the Austrian Emperor
were overthrown. Germany was the key centre. In
November 1918 the bodies of armed men, which as Engels
had pointed out are the essential core of a state machine,
began to turn on their masters. By 4 November
revolutionary feeling in Kiel was at fever heat, wrote the
historian of the German revolution. The High Command
and the officers of the navy surrendered, while some on the
battleship Koenig and other vessels were killed. The sailors
had become masters of the situation and the army units in
the area joined them.
In Kiel there was only one authority the Council of

workers, sailors and soldiers deputies ... From Kiel the
rebellion spread to Hamburg and on the night of 8
November it was learned in Berlin that it had triumphed,
with little or no resistance, in Hanover, Mageburg, Cologne,
Munich, Stuttgart, Frankfurt-am-Main, Brunswick,
Oldenburg, Wittenburg and other cities ... At eight oclock
on the morning of 9 November the general strike broke out
in Berlin itself. The Kaiser fled. The German workers,
through their councils of deputies, found themselves in
power.
The task now was to consolidate a revolutionary,

democratic, workers republic. This the right wing social
democrats, who controlled the largest block of delegates in
the workers councils, were determined to prevent at all
costs. They had become the junior partners of the German
ruling class during the war. They now showed their true
colours. They set out deliberately to save German
capitalism. Ebert, the future social democratic President of
the Weimar Republic even opposed the abolition of the
monarchy! Every ounce of influence the party could exert
was used to persuade the workers to accept a democratic

capitalist regime.
It could hardly have succeeded but for the confusion,

weakness and cowardice of the left wing independent
social democrats who had split from the party in 1916.
Though in a minority in the country as a whole, the
independents had three out of the six men in the Provisional
government and a decisive influence over the workers of
Berlin. The independents allowed themselves to be pulled
along by the right. They protested but they gave the right
wing the indispensable left cover that made it possible to
dismantle the workers power that actually existed and to set
up a parliamentary Republic.
Only the small Spartakus League defended the Soviets. They

were first isolated, then provoked into a premature armed
rising and finally crushed by a newly-created right wing
military force directed by the social democrat Noske. This
defeat isolated the Russian Soviet Republic. The long term
consequences of that isolation were tremendous.
16. The Rise of Stalins Dictatorship

The defeat of the German revolution early in 1919
emphasized the need for an effective revolutionary
international and a decisive break with the unreliable
independent and centrist leaders. The Communist
International held its founding conference in Moscow in
March 1919. Within three years it had gained the support of
mass Communist parties in Germany, France,
Czechoslovakia and some smaller European countries, on
the basis of an uncompromising internationalist and
revolutionary programme.
Unfortunately by that time the crisis had passed, European

capitalism had been temporarily stabilized and the Soviets
outside Russia destroyed. But the next crisis would, it was
hoped, find well-established revolutionary parties with a
strong working-class base. Yet the Communist International
was inevitably critically influenced by what happened in
Russia. And by 1921 the Russian Soviet regime was facing a
desperate situation. The long term outcome of that crisis
was to demoralize and ultimately destroy the International
and to paralyze the working-class movement for half a
century.
The end of the civil war left the Soviet government isolated
in a hostile world and isolated also from the mass of the
Russian people the peasants. So long as there was a real
danger that the Tsarist landowners might be restored, large
sections of the peasantry supported the Bolsheviks. Once
this danger had passed they became actively hostile to a
government that had been driven to rely on forced
requisitioning of grain to feed the cities. The entire system
rests on the discipline of the party, on organized famine in
the cities, on requisitions in the country, wrote the
communist Victor Serge. The rising of the sailors in
Kronstadt and, even more ominous, the strikes in support of
it showed that the regime Was losing working class support
too. It was becoming a dictatorship not of but over the
peasantry and the remnants of the working class.
Reactionaries argue that this was the inevitable

consequence of the original sin of revolution. Some people
on the left, who ought to know better, argue that it was due
to the ruthlessness of Lenin and the existence of a
disciplined party. This is rubbish. The essence of the matter
has been stated by Marx 60 years earlier. If the working
class destroy the political rule of the capitalist, that will only
be a temporary victory ... so long as ...the material
conditions are not yet created which make necessary the

abolition of the capitalist made of production.
On an all European scale these conditions had been created.

In Russia by itself they had not. This was well understood by
the founders of the Communist movement. Since there has
been so much misrepresentation of this basic truth, it is
necessary to emphasize it. Speaking at the third Congress of
the Communist International, Lenin stated: It was clear to
us that without the aid from the international world
revolution, a victory of the proletarian revolution is
impossible. Even prior to the revolution, as well as after it,
we thought that the revolution would occur either
immediately or at least very soon in other backward
countries and in the more highly developed capitalist
countries, otherwise we would perish. Notwithstanding this
conviction, we did our utmost to preserve the Soviet system,
under any circumstances and at all costs, because we know
we are working not only for ourselves, but also for the
international revolution.
In the event the renegade leaders of the social democratic

parties succeeded, in the critical year 1919, in sabotaging
what would otherwise have been successful revolutions in
several European countries. The Soviet regime the rule of
the working class through democratically controlled
workers councils- did indeed perish. But there was no
restoration of the Tsarist landlords and capitalists. Instead a
system still calling itself a Soviet Socialist Republic, but in
fact a totalitarian dictatorship, developed in Russia. It is not
possible here to trace the struggles that led to the rise of
Stalinism. A good short summary is given in the IS
pamphlet How the Revolution Was Lost by Chris Harman.
But the effect of this development on the Communist
International changed the whole course of events outside
Russia.
The parties of the Communist International contained the

cream of the working class. In their early years these parties
were far from being subservient to Moscow. In 1923 the
French and Polish parties had protested vigorously against
the attacks of the Russian bureaucracy the Stalin faction
on the Communist opposition in the USSR. But with the
receding of the revolutionary mood in Europe the parties
became more attached to the one surviving Soviet regime
and more dependent on it. Advice from Moscow became the
most important source of their political ideas.
Increasingly the Russian bureaucracy, which dominated the

executive of the International, began to interfere with the
internal life of the parties. Telegrams from the executive
became more frequent. A wit described the CP of the USA in
the mid-twenties as suspended by wires from Moscow.
The Stalinists used genuine political disputes within the
movement to promote leaders for whom the decision of
Moscow was final. Gradually the more independent leaders
and the more serious Marxists were eliminated.
The policies that Stalin and his colleagues pressed on the CI

were partly determined by the factional struggles inside the
Russian party until 1929 when Stalin became the supreme
boss and partly by the requirements of Russian foreign
policy.
In the middle-twenties semi-reformist tactics were adopted

and they led to a number of avoidable defeats. Most
spectacular was the defeat of the Chinese revolution of 1925-
27. Stalin urged the Chinese CP to unite with the
Kuomintang the party of Chinese capitalism. The
Kuomintang was to be pushed into power and the
Communists were to curb the violent risings of workers and
peasants in the interest of national unity. Chiang Kai-shek
was actually made an honorary member of the executive

of the International!
The results of this adventure were the smashing of the

Chinese revolution and the creation of a right-wing military
dictatorship under Comrade Chiang. Worse was to come.
The German party, the strongest in the International, and
with it the whole German working class movement, was to
be led to catastrophic defeat. The consequence was the
victory of fascism in Germany.
17. Stalins Zig-Zags

Marxism is not a theory that can exist cut off from the
workers movement. It is based on the unity of theory and
practice. There can only be a Marxist movement when there
is a significant body of working class militants conscious of
their real position in society and active in the class struggle.
This is why the fate of the Communist International is so

important. Virtually all the best elements in the movement
came into the CI. A whole layer of advanced workers,
especially in Europe, joined it. They were the living force
that carried the marxist tradition. The gradual conversion of
the CI from a revolutionary international into an instrument
of Russian foreign policy destroyed this layer and paralyzed
the revolutionary movement for decades. It is impossible to
follow the decline of the CI in detail. Three examples, each
from a different phase of the evolution, are enough to
illustrate it.
Germany 1930. The great depression was undermining

the parliamentary capitalist republic. Unemployment
reached six million. The Nazi Party was growing by leaps
and bounds. At. the election in 1930 Hitler got nearly 6
million votes.
They were the votes of the middle classes, the rural

population and some unorganized workers. The organized
workers held fast for the traditional workers parties. Six
million odd votes went to the social democrats and over 4
million to the communists. The growing menace of fascism
was obvious. So was the need for the working class
movement to unite and smash it. Unfortunately the
leadership of the International, by this time completely
subservient to Stalin, thought otherwise. Following his
victory over the remaining opposition in the Russian
Communist Party in 1928-29, Stalin swung the CI round to
a policy of insane ultra-leftism.
The centre-piece of this Third Period policy was the theory

of social fascism. The social democratic party and by
extension the unions it controlled were described as
fascist organizations. According to Stalin himself,
Fascism is the military organization of the bourgeoisie
which leans upon the social democracy for active support.
Then social democracy objectively speaking, is the moderate
wing of fascism. So there could be no question of using the
discontent of the social democratic rank and file to force the
party to join a united front against fascism. Nor was the
victory of Hitler itself to be feared. We are not afraid of the
fascist gentlemen, said the communist leader Remmele in
the Reichstag. They will shoot their bolt quicker than any
other government.
In 1932 Hitlers vote rose to nearly 14 million. Still the main

enemy for the CP was social democracy. In January 1933
Hitler became Chancellor of Germany. Even then the CP
clung to its absurd line. The talk about the German
Communists being defeated and politically dead, said the
official CI journal in April, is the gossip of philistines, of
idiotic and ignorant people. By this time most of the partys
activists were in concentration camps or in hiding! But
times were changing. The rulers of the Kremlin began to

understand that Hilters victory was in fact a decisive
turning point. The CI, accordingly, was swung over to the
far right. Alliances were sought not only with the social-
fascists of yesterday but with liberal and conservative anti-
fascist parties. The popular front was the order of the
day. Revolution was definitely out.
Spain 1936. A coalition of liberal, moderate conservative

social democratic and communist parties won a general
election. The army, supported by the extreme right,
revolted. On 17 June General Franco announced his mission
to save the nation. On 19 June working class risings, led
mainly by anarchists and left socialists, broke out in the
cities. In Barcelona, in Madrid, in many other towns, the
army was defeated and workers militias took control.
Within a week it was clear that there were only two real
forces in Spain, the troops loyal to Franco and the organized
workers.
In these circumstances the Spanish CP, following the line of

the CI, set out to create a coalition government with the
representatives of the liberal capitalists! The last thing
Moscow wanted in 1936 was a revolution that would upset
the governments of France and Britain. The French CPs
daily published this reassuring statement The CP of Spain
requests us to inform the public that the Spanish people are
not striving for the dictatorship of the proletariat but know
only one aim:
the defense of republican order while respecting property. Under

pressure from Russia, the Spanish republican government was
pushed further and further to the right. The left wing social
democrats were pushed out as being too radical. The anarchists
and independent left wingers were persecuted.
Stalin did not want a pro-Hitler Spain and so arms and

volunteers were sent to the republican government but on
conditions that strengthened the conservatives. Eventually
the loyal republican Colonel Casado last war minister of
the republic organized a coup, threw out the CP and
opened negotiations with Franco.
Moscow 1943. To please his US and British allies Stalin

formally disbanded the Communist International. The
carve-up of Europe between East and West was being
planned. Part of the deal was the assurance that the western
CPs would loyally support the re-establishment of capitalist
parliamentary regimes. They did. In many countries they
entered coalition governments of national unity. In
France, where the CP and Socialist Party together got more
than 50 per cent of the votes in 1945, the party insisted that
de Gaulle remain head of the government and that the
Gaullist conservatives enter the coalition! It was a far cry
from 1919.
The militants who followed the Communist parties were for

the most part sincere, devoted people. They were misled by
the myth of the Soviet Fatherland. Stalinism paralyzed the
Marxist movement for a long time. Hungary,
Czechoslovakia and Poland, and, in a different way,
Yugoslavia and China, have begun its break-up as a system
of ideology. Out of that break-up the movement will be
reborn.
18. The Only Way Forward: An

International Strategy
For the creation on a mass scale of this communist
consciousness, as well as for the success of the cause itself, it
is necessary for men themselves to be changed on a large
scale, and this change can only occur in a practical
movement, in a revolution. Revolution is necessary not only
because the ruling class cannot be overthrown in any other
way, but also because only in a revolution can the c/ass
which overthrows it rid itself of the accumulated rubbish of
the past and become capable of reconstructing society.
Marx.
This is the essential reason why parliamentary roads to

socialism have always proved to be blind alleys. In a
capitalist society most of the power is in the hands of the big
business bosses. They cant be talked or tricked into giving it
up. It has to be taken from them. This can be done only by
working people organized and conscious of their position in
society and determined to free themselves, and the rest of
society, by taking power the power to decide about
everything that affects their lives into their own hands.
And they can only become capable of self-government in the
course of fighting for it. Participation in parliament may be
a useful tactic. It can never be a substitute for direct action.
We have had quite a lot of experience of parliamentary

roadism. Social democratic parties have been in office, at
one time or another, in most of the developed capitalist
countries except Japan and the USA. In Britain we have had
four Labor governments. The result is that the rich are
richer than ever and all the evils of capitalism intensified
competition, meaningless work, head-fixing and
manipulation of people, unemployment and increased
productivity going hand in hand, growing wealth, growing
waste, pollution and growing poverty are increasing evils.

Racialism is rampant. Women are still super-exploited in
April 1974 the average wage of women manual workers was
23.60 per week as compared to 41.90 for men.
We cannot afford or so the bosses and their tame mass

media tell us a decent health service, decent housing or a
decent educational service. In fact the greater the amount of
output the less, apparently, can be afforded for basic social
services. A trivial but significant example. From 1940 till
1969 free milk for all school pupils was the rule. Now, with a
vastly greater output than in 1940, it has to be cut out. First
by Harold Wilsons Labor government for secondary
children, then by Heaths Tories for junior children too.
So it is with all the social services. They are even trying to

abolish free admission to museums and galleries, something
even the Gradgrind capitalists of Victorian Britain managed
to afford! The truth is that we are going backwards in one
field after another. Nor can this be simply blamed on the
1970-74 Tory government. In every field, from the decline in
public housing to anti-trade union legislation, the 1964-70
Labor government led the way and the Tories have followed
in their footsteps.
It is no use blaming this on the betrayals of Wilson and co.

Of course they are traitors but this is not the problem. There
are rotten apples in every barrel. When practically the whole
social democratic barrel turns out to be rotten there are
deeper causes. Reformist policies could never at any time
lead to socialism. They could, while the arms boom was
flourishing, lead to some reforms. Not anymore. All the
modest gains of the last 30 years are now threatened and
they are threatened because the fundamental tendencies of
state monopoly capitalism are reasserting themselves. Any
government that tries to keep the system going and at the
same time introduce real reforms is doomed. Either it goes

out of office or the reforms are junked.
Of course reformism was always based on sectional, purely

national policies. They were never realistic but they are
less realistic today than ever. We dont live in an island
anymore. We live in a world in which the techniques and
resources to give everyone a decent life already exist and in
Which half the people are on the borderline of starvation. It
is a violent world in which the two super-powers, Russia
and America, have between them enough thermonuclear
weapons to wipe out the whole population a several times
over.
It is a militaristic world in which the military coup leading

to dictatorship is now the commonest way of changing a
government. It is a polluted world which national economic
and military competition threatens to make less and less
habitable. Capitalism is international. The giant firms have
investments throughout the world and owe no allegiances
except to themselves and the system that allows them to
plunder the worlds resources. There can be no real socialist
organization that is not based on an international and
therefore a revolutionary strategy. Ordinary people
everywhere want peace, security, freedom from drudgery,
human dignity, a decent life. Yet these things can only be
had by the organization of working people into a decisive
force on an international scale.
There are no short cuts. Years ago Marx wrote the

emancipation of the working class must be the act of the
working class itself. Today we can add that the whole future
of humanity depends on its success.
Reading List
On the Materialist Conception of History
Engels, Historical Materialism, Pluto Press. This little pamphlet of
twenty odd pages is about the development of ideas and their connection
with the class struggle. Not easy reading but worth the effort.
Engels, Socialism, Utopian and Scientific. Another short pamphlet,
actually an excerpt from the much longer Anti-Dhring. It contains the
classic statement of the elements of Marxism. Essential reading.
Marx and Engels, Communist Manifesto. The first and second sections
are the important ones.
Plekhanov, The Materialist Conception of History, The Role of the
Individual in History, Fundamental Problems of Marxism. All fairly
short but not particularly easy available in one volume by Lawrence &
Wishart.
Carr, What is History? Penguin. Near Marxist outline of problems of
interpretation. Well worth careful reading.
Some Useful Histories

Childe, What Happened in History, Penguin. From the stone age to the
Roman Empire. Good Marxist account.
Huberman, Mans Worldly Goods, Monthly Review. From the middle
ages to the twentieth century. Best popular economic history ever written.
Beware of Stalinist conclusion.. Very easy to read.
Kuczynski, The Rise of the Working Class, World University Library.
Liberal rather than Marxist but useful. Good illustrations.
Thompson, The Making of the English Working Class, Penguin. Massive
but readable. Excellent account of the early struggles.
Miliband, Parliamentary Socialism, Merlin Press. The lowdown on the
Labour Party.
Cole, The British Working Class Movement 1787-1947 (out of print but
available from most libraries). Dull but full. Least reliable for twentieth
century. Liberal tinted.
Marxian Economics
Marx, Value, Price and Profit. Very clear and simple. Argument assumes
effective competition.
Marx, Wage Labour and Capital. All about surplus value.
Sweezy, Theory of Capitalist Development, Monthly Review. There is no
satisfactory overall account of Marxian economics. This one is the best of
those available. Not for bedtime reading.
Mandel, An Introduction to Marxist Economic Theory, Pathfinder. Short,
useful and readable introduction. Probably the best thing to start with.
Kidron, Western Capitalism Since the War, Penguin. Essential. Up to date
description and analysis.
Socialism, the State and the Party

Marx, The Civil War in France. If you never read anything else by Marx
read this.
Lenin, State and Revolution. The perfect antidote to parliamentary
roadism.
Gramsci, The Modern Prince, International Publishers. Difficult but
rewarding discussion of class and party.
Trotsky, Cliff, Harman, Hallas, Party and Class, Pluto Press. Four
contributions on the problems of building a revolutionary party.
Russia and Stalinism

Trotsky, The Revolution Betrayed, Written in middle thirties.
Indispensable.
Cliff, Russia A Marxist Analysis, IS. Takes Trotsky as read, brings up to
date and modifies conclusions. Difficult but invaluable.
Trotsky, Fascism, Stalinism and the United Front 1930-1934, IS Special.
The rise of Hitler and the crucial role of the Communist International.
Morrow, Revolution and Counter-Revolution in Spain, New Park
Publications. How the Spanish revolution was strangled (1936-38).
Ideology
Harris, Beliefs in Society, Watts. An excellent survey. Not
too easy to read but repays effort.
Collections
The Essential Left, Allen and Unwin. Contains Communist Manifesto,
Value, Price and Profit, Socialism Utopian and Scientific and State and
Revolution. Good value.
Essential Writings of Karl Marx, Ed. Caute, Panther. Handy collection of
excerpts with unhelpful commentary.
Karl Marx, Ed. Rubel and Bottomore, Penguin. Another useful collection
of excerpts with anti-Marxist introduction.
General
World Crisis, Ed. Harris
and Palmer, Hutchinson. The method
applied. A revolutionary survey of the world today.
Footnote
1*. Since this was written there has been a short-lived inflationary boom
(1972-73) followed by the deepest recession since the war, both occurring
on a world scale. The growing instability of world capitalism is now
obvious even to orthodox opinion.

Duncan Hallas - The Meaning of Marxism

Загружено:

Сведения о документе

Авторское право

Доступные форматы

Поделиться этим документом

Поделиться или встроить документ

Параметры публикации

Этот документ был вам полезен?

Это неприемлемый материал?

Авторское право:

Доступные форматы

Duncan Hallas - The Meaning of Marxism

Загружено:

Авторское право:

Доступные форматы

The Meaning of Marxism

First published as a series in Socialist Worker, November 1970-February 1971.

The chapters of this pamphlet first appeared as weekly

As far as possible I have let Marx speak for himself but I

1. Why we need a theory

l. Why we need a theory

Leave aside fairy tale history and look at some of the

Interesting problems for students but do the answers

The employing class and its politicians and intellectuals

Actually facts never speak for themselves. As a well-

Marx was interested, first and foremost, in social

Modern capitalist society, springing from the wreck of

That immediately brings up another point. If the

There can, in fact, be no impartial history. Everyone is

But why should we believe that our interests, say, are

There is a still more basic reason. The kind of society

Stone axes and wooden spears go with a tribal society

organization of the family, of orders or of classes, in a word,

All forms of society before capitalism had this in

In fighting to overthrow capitalism we know that we are

2. The Battle for Markets

Two hundred years ago, the English peasants and the

Of course there had been many changes. If Wat Tyler

The big houses, the magnificent homes of the gentry

In 1750 Britain stood on the eve of the greatest change

With capitalist production they became central. The

The economic historian E.J. Hobsbawm has

The political basis for the series of wars of aggression

Genghis Khan and his kind had created great empires

In some countries the outcome of earlier class struggles

Other countries, where the previous struggles had left

became colonial or semi-colonial areas. But they, too, were

The West industrialized, they were de-industrialized.

Once established the world market dominated, and

The second revolutionary effect of capitalism was an

Since that time the growth in the productivity of labor

The point remains that the material basis for a world

allowing for any increase, was rationally organized to

The third revolutionary consequence of capitalism has

3. The Workers Vital Role

On a world scale this problem has been solved. The

On the. other hand in most of the under-developed

A Chinese economist published a book in 1950 giving

manufacturing capital alone were considered. Even making

The same argument applies to the rest of the Third

Such a movement must be based on the industrial

While it is the case that the low level of the productivity

As Marx, writing of the French peasantry, noted:

class interests ... They cannot represent themselves, they

Slaves, serfs, peasants could and often did revolt, burn

It is the concentration of the modern working class into

Marx took as his model of working class rule the Paris

So were the officials of all other branches of the

Such a revolutionary and democratic regime, solidly

4. Who Produces the Wealth?

Marxs purpose in analyzing capitalism was first to show

The first point becomes clear when you consider other

Marxs labor theory of value explains how. First of all

This idea did not originate with Marx. As a modern

Marx himself introduced a number of refinements. For

produced today, would not have a correspondingly high

Of course different producers at any one time are using

The value of the end product includes the value of all