1950s >> 1955 >> no-615-november-1955

The Observer newspaper has been running a series of articles on the future of the Labour ‘Party, in which various writers have diagnosed that Party’s troubles and offered remedies. Some of the articles have gone beyond the problems of organising and of attracting voters, to deal with wider topics such as the meaning of the Labour Party’s “Socialism” and the requirements of the world today. One of these, “A Time for Hard Thinking” (Observer, 9/10/55), was contributed by Mr. Anthony Crosland, who sat in Parliament as Labour M.P. for five years for the South Gloucestershire constituency, and was defeated in the Test division of Southampton at the general election in May of this year. Mr. Crosland is described as an economist and former university lecturer. He is a member of the executive of the Fabian Society.

Let it be said at once that if Mr. Crosland’s article is not impressive it is certainly staggering. It is staggering that one who has the opportunities possessed by Mr. Crosland of studying the world he lives in should be able to see so little and deceive himself so much.

The core of his argument is that such wonderful progress has been made in this country that the old working class economic problems are with us no more and Socialism should therefore be defined afresh “in terms of a set of social and ethical aspirations.”

Mr. Crosland maintains that “the long-run problems of concern to Socialists are no longer mainly economic.” This is because:—“British Capitalism has been transformed almost out of recognition. … I, personally, think it rather absurd to go on calling this economy ‘Capitalism.’ . . .”

It was right and proper, he says, to be concerned in the past with the economic problems of unemployment, instability, and physical poverty, but not any more.

“But to-day, the economic system has been reformed, and no longer poses these traditional problems. Even with a Conservative Government we shall probably maintain full employment (if not inflation) for as far ahead as we can see, and we now have a rate of economic growth which, although not fast enough to satisfy some austere perfectionists, is certainly fast enough to eliminate poverty and sustain a rapid rise in working-class earnings. Despite the tiresome problem of the foreign balance, our present economy is capable of distributing material benefits on a scale which would have staggered Socialists only a generation ago.”

As already mentioned, the really interesting thing about this sketch of a Capitalism reformed out of recognition is that it is false in almost every particular.

It reads like one of the dreams indulged in by the earliest members of the Labour Party about what they thought would take place.

Almost the only factor among these he mentions, that gives seeming support to his case, is the unusually long period of very low unemployment.

Nobody questions that the replacement of the destruction caused by the last war has played a part in this but Mr. Crosland, like many others, thinks that “full employment” can now be maintained by Government policy. As it would take us too far afield to deal here with the economic fallacies inherent in this belief in permanent full-employment it must suffice at present to remind Mr. Crosland that every boom in Capitalism’s history has produced its prophets of no more slumps; not to mention the Labour Government that went into office in 1929 convinced that it could prevent slumps but which was submerged by the most prolonged depression for 50 years.

One of Mr. Crosland’s points is that the old Capitalist “instability” has disappeared. If he means in this country alone (this is not clear) he would be making the elementary error of supposing that British exports could go on booming in face of an outside world in the throes of a crisis; but whether he does mean this or not, there is no evidence anywhere that Capitalism has got rid of instability. Has Mr. Crosland forgotten the sharp recession in U.S.A. in 1954, the quite acute textile slump in Britain and elsewhere in 1952, and the recent announcement in Australia and New Zealand that imports of British cars and other goods, are being cut? And did Mr. Crosland notice the “stable” way the Stock Exchange behaved when President Eisenhower’s illness was reported? A Daily Mail New York representative cabled:

“The biggest stock market break since the great crash of 1929 hit Wall Street to-day—a direct reaction to President Eisenhowers illness. . .
“Many shares dived by $15 The flood of selling orders raised the trading to 7,720,000 shares, the highest in 22 years. Total loss reached nearly £4,000 million.”—(Daily Mail, 27/9/55.)

The Daily Herald of the same date reported “gloom in share markets in this country partly due to the same cause. Alastair Forbes, a regular contributor of the Conservative Sunday Despatch had a pointed comment on this:—

“. . . What can one say of capitalism as a system when the news that President Eisenhower has had a heart attack causes a panic selling wave on the stock market ? . . . Even the explanation that the selling panic would never have taken place if the intelligent members of the New York Exchange, who are all Jews, had not been away for Yom Kippur, is scarcely enough to rehabilitate the system in the eyes of the watcher through the Iron Curtain.”—(Sunday Dispatch, 2/10/55.)

But the chief interest attaches to Mr. Crosland’s belief that “physical poverty” is no more, and that “material benefits” are distributed now by Capitalism in Britain on a scale that would have staggered Socialists a generation ago. We are compelled to ask where Mr. Crosland, the economist, got this information.

There has, of course been a very great rise in the price of everything including the price the worker gets for the sale of his physical and mental energies, but we cannot suppose Mr. Crosland has not allowed for this. What, then, is there to show for the 30 years since—say 1925?

The figures published by the London and Cambridge Economic Service show a rise of average wage rates between 1925 and 1955 of 163 per cent.; that is to say wage rates now are about 2 2/3 what they were in 1925. The L.C.E.S. also show a rise of 116 per cent. in the cost of living. Coupling these two figures we can say that average wage rates are now 23 per cent, more than they were 30 years ago. Is a small increase of something averaging well under 1 per cent, a year a phenomenon to be staggered by? Is it this that, for Mr. Crosland, has revolutionised society and abolished Capitalism?

Let us remind Mr. Crosland, too, that this very modest rise has not been a “benefit” distributed by Capitalism or by Governments, but something for which the workers have had to struggle through strikes, the number of which is now steadily increasing. This we need hardly say is the old unregenerate Capitalism with its class struggle! It should not be forgotten, too, that the workers had to fight to maintain their wage rates under and against the Labour Government, and for the four years between the starting of the new wage index and cost of living index, in June, 1947, and the end of the Labour Government the workers fought a losing battle, for the cost of living rose by 29 per cent, and wage rates by only 22 per cent.

It is true that workers’ earnings have risen by a larger amount than have wage rates. This is because they are working more overtime, more piece-work and other-systems of pay related to output, more night work and shift work. Are these, too, regarded by Mr. Crosland as evidences of progress away from Capitalism?

He thinks “physical poverty” has .gone. May we ask Mr. Crosland what state of living it is that the unemployed, the sick and the aged enjoy on their small allowances, not to mention the several million men and women whose wage rates are on the £6—£7 level or less. Mr. Crosland is not the only person to cherish silly notions about how the treatment of the above groups has been revolutionised, but when allowance is made for the fact that the cost of living is now only just a little short of 2½ times what it was in 1938 the thing will appear in proper perspective. Just to take one item, the unemployment benefit of a single man was 17/- in 1938, it is now 40/-. Truly a staggering advance except for the fact that the purchasing power of 40/- now is slightly less than that of 17/- in 1938!

And what does Mr. Crosland make of the slum position? He thinks that Capitalism has gone but certainly its slums have not. Mr. F. Collin Brown, chief housing and planning inspector to the Ministry of Housing and Local Government, told a conference of Sanitary Inspectors at Scarborough on 13 September last that “he estimated that about one million houses in this country were beyond repair. . . . More than three million houses in Great Britain were over 80 years old, and two million-odd over a century old.”–(Times, 14/9/55.).

Another thing, and this [is] vital to the whole question of Capitalism and Socialism, is not even mentioned by Mr. Crosland, that is, the enduring vast inequality of ownership, the 10 per cent. who own 90 per cent. of the accumulated wealth. This is the basis of Capitalism, the ownership of the means of production and distribution by the propertied class. It has not been abolished, it has not been tackled. Nothing whatever has been done about it, nor could it be, except through the abolition of Capitalism and establishment of Socialism.

Mr. Crosland does not deal with this issue and until he does so he has not even begun to present an argument to support his fantastic proposition about the disappearance of Capitalism. Something he does do makes his case even flimsier. He ascribes to Karl Marx the responsibility for having originally turned attention to the economic problems of Capitalism. This, Mr. Crosland approves of, though now he thinks it has become out-of-date with the passing of Capitalism, but he also holds Marx largely responsible that “Socialism came to be (falsely) defined in terms of nationalisation.”

That Socialism was falsely defined in terms of nationalisation we readily admit but not by Marx; this was the work of the Labour Party.

But above all it is false because it obscures the essential feature of the Marxist case, that Capitalism rests on class ownership.

The early Fabians appreciated this and the importance of dealing with it. The later ones, Mr. Crosland among them, faced with the Labour Party’s 50 years of running way from the problem, can only offer now the bland suggestion that ownership doesn’t matter after all and Capitalism has disappeared anyway.

One other thing Mr. Crosland failed to notice in his fascination for his argument for forgetting economic problems. He perceived, logically, that if his premises are correct the “ economists ” can be dispensed with for their job is done; but he did not notice that if Capitalism and its evils have passed away, and full employment is safe with the Conservatives, will workers any longer trouble to vote for the Labour Party or for Mr. Crosland?