Editorial: A Monopolist Scheme for Control

Since the advocates of “nationalisation” of industry switched over to preaching State supervision of private monopolies on the lines of the London Passenger Transport Board there has been a noticeable increase of friendliness in the relationship between leading trade union officials and Labour leaders on the one side and what are called “progressively minded” captains of industry on the other. The progressive mindedness means nothing more than that the individuals in question have an interest in replacing the existing small and medium-sized concerns by large-scale monopolies or semi-monopolies. That they are in favour of change at all is sufficient to bring the Labour Party to view them as potential allies on the road to office, and that party obligingly popularises the terms “Public ownership” “public utility corporation,” and “socialisation” as a cover under which those large-scale capitalists who are out to devour their smaller and weaker brethren, can operate. The Labour Party and the trade unions are thus to throw their weight on the side of the workers’ most powerful enemies, or are to remain neutral while these enemies consolidate their position.

The lines on which the bigger capitalists are thinking has already been disclosed by the merger of London transport and the schemes propounded in various quarters for amalgamating the iron and steel industry, the mines, the electricity concerns, and so on. A detailed scheme applicable to a whole series of industries is contained in the Industrial Reorganisation (Enabling Bill), presented in the House of Lords last autumn by Lord Melchett (price 4d., from H.M. Stationery Office).

Some interest attaches to the promoter of the Bill. He is the son of the late Lord Melchett, formerly Sir Alfred Mond, the Liberal who went over to the Conservatives at about the time that the Conservatives’ Derating Act bestowed very substantial rating reliefs on Imperial Chemical Industries, the firm of which he was head. The present Lord Melchett is director of I.C.I. and of other chemical, coal, and finance companies, and of Barclays Bank. Although a Conservative, he holds what are regarded as unorthodox views on currency and banking, and like his father, has been heard to denounce the rapacity of the money-lending capitalists. Because of this he is much admired in certain Labour and currency crank circles where the sectional antagonisms of the various groups of capitalists are thought to be of concern to the workers who are exploited indiscriminately by all capitalists. One can guess that Lord Melchett would show the same lofty disregard of the party line as did his father, and he may some day be seen graciously allowing the Labour Party enthusiasts for remodelling capitalism to pull chestnuts out of the fire for him.

The object of the bill “is to provide for the self-government of industries by enabling the majority of producers in an industry, notwithstanding the opposition of a small minority, to introduce and cause to be enforced schemes for the reorganisation of the whole or part of that industry with the general object of promoting greater efficiency, eliminating wasteful competition, and of facilitating the production, manufacture, and supply of the products of that industry.”

Now what could be more reasonable, innocent sounding, and democratic than that? Who would not want to see mining, chemicals, textiles, tobacco, foodstuffs, etc., etc., made more efficient in the interest of all?

But not so fast. The voting is to be “democratic,” the “majority” is to decide the issue (subject to inquiry, supervision, and possible veto by Government and Parliament), but the majority is not to be a majority of the population or of those engaged in the industry. It is only to be a majority of persons who have “an ownership interest,” in other words, the capitalists alone, although they are only a small minority in relation to the workers they employ. Thus this democratic self-regulation of industry is just the same as the so-called democratic control of industry preached by Sir Oswald Mosley and the Fascists generally . The workers are to get a look-in not in proportion to their numbers, but simply as a trade union having a “special interest” in the industry, and thus entitled merely to express opinions. Lord Melchett, like Sir Oswald Mosley, is determined that the workers shall not decide. Capitalism, reorganised, is to be preserved intact.

Moreover—and this is where the bill exposes the particular aim of the big capitalist—the “ownership interest” of any person or persons putting forward a scheme of reorganisation to the Board of Trade must be a “substantial one having regard to the ownership of all other persons having an ownership interest in the industry.” Thus weight is to be given in the question of promoting a scheme, not to the number of capitalists, but to the size of their capital. Eventually, after any scheme has been published and discussed, a poll of all persons having an ownership interest shall take place, and if 75 per cent. of the recorded votes are in favour the scheme shall go forward for Parliamentary approval notwithstanding the objections of the minority. The use of this to crush the smaller fry in any industry is obvious, and that no doubt is why Lord Melchett’s bill was drafted. Those of his admirers who think that his criticisms of the banks arise from a disinterested desire to see the small man helped to keep his head above water by means of easier credit facilities are invited to study the bill, and note what its effects would be if it or a similar measure is eventually adopted by a Government and becomes law.

Anyone who is interested in the way large-scale industry is developing will find much useful material in a study of Imperial Chemical Industries, published in the Economist (January 19th, 1935). This £77 million combine made £7,664,000 profit in 1933.

What this means is perhaps best conveyed by relating it to the number of workers employed. According to figures published a few years ago, the number was then about 60,000, and on this basis the profit represents about £128 per head of the workers employed. (The number has, possibly, increased somewhat in the meantime.)

I.C.I. is interested in chemicals, explosives, fertilisers and many other trades, “as diversified as sporting cartridges and soda crystals, motor components and motor fuel, and property It has connections by shareholdings or agreements with powerful concerns in Germany, U. S. A., Canada, S. Africa, and elsewhere. It has a “footing in many countries (from China, literally, to Peru).”

In view of the popularity so-called planned economy is attaining in the eyes of members of the Labour Party, we read with interest the opinion expressed by the Economist that: