The British Road to Socialism (1989)

To understand the situation in Britain it is first necessary to place it in the context of the world situation today which, whatever the complexities, is at the most basic level characterised by the transition from capitalism to the higher system of socialism. The source of Britain's problems lies in the fact that it remains a key part of the world capitalist system and is therefore prone to its protracted crisis.

Crisis is intrinsic to capitalism because it is characterised by fundamentally irreconcilable contradictions. The most basic contradiction is between the social character of production and the private ownership of the means of production. The majority of factories, banks, transport systems and other productive forces are owned by a tiny minority of the population, the capitalist class, while the great majority, those who work by hand or by brain, own little but their labour power, their capacity to work. The wealth they produce by their work is greatly in excess of the wages or salaries they are paid, and is the source of the profits of the capitalists.

The drive for maximum profit causes the capitalists to do two contradictory things. On the one hand to expand production, and on the other to reduce the proportion of the wealth produced going into wages and salaries, and therefore the ability of the people to buy all the goods being produced.

It is this exploitation of the working class by the capitalist class, this fact that capitalism's motive force is not production for the needs of society but for the maximum profit of employers and bankers, which explains why capitalism tends to expand its productive potential beyond the ability of the market to absorb all that could be produced. It explains why capitalist production has never developed smoothly, but cyclically, through a series of booms and slumps.

Attempts to perpetuate capitalism's existence in the face of these recurrent crises by adopting new forms of exploitation or new methods of regulation and control have meant that capitalism exhibits different features at different phases of its development, although its basic nature always remains the same.

For example, the cyclical crises in the 19th century led to the bankruptcy of large numbers of smaller firms, and the growth in size of those who managed to survive. That eventually forced the first major transition, from free-trade capitalism, in which the competition of small firms was the major feature, to the system of imperialism, typified by the domination of the economy by a handful of powerful monopolies straddling industry and finance. Another key feature of the imperialist stage of capitalist development was the export of capital, with a view, initially, to exploiting the countries of what we call today the Third World for their raw materials. For the most part, these countries were annexed as colonies, which served as a protected market as well as a source of cheap raw materials.

The development of imperialism intensified the problems underlying capitalism's crisis. It culminated in the bloodbath of the First World War, as the capitalist powers attempted to redivide the world and expand their respective spheres of domination. And it was this same conflict of interest between the major capitalist powers that was involved in the run-up to the Second World War, although by then there was another and ultimately central feature, namely, the attempt on the part of the most reactionary and fascist elements in the imperialist world to destroy the Soviet Union and wipe out the gains of socialism established for the first time in history by the Russian Revolution of 1917.

The conclusion of the Second World War, which saw the complete defeat of the fascist axis centred on Germany and Japan, and the establishment of socialism in a number of countries, opened up new prospects, and offered renewed hope and optimism, to millions of exploited and oppressed people the world over. And in the advanced capitalist countries, this was also the decisive factor that helped the working class to achieve significant advances in wages, job prospects and in living standards generally.

The emergence of a world socialist system, the beginnings of the collapse of the old form of colonialism, and in the advanced capitalist countries the increased power and militancy of the working class which adamantly refused to see a return to the conditions of the 1930's, were the major reasons dictating the necessity for capitalism to carry forward vigorously the further development of state-monopoly capitalism.

Through the integration of the political power of the state with the economic power of the monopolies, the major imperialist countries attempted to contain the major contradictions inherent in their own system, and to modify the more extreme forms of exploitation and oppression. In the initial post-war period, the direct intervention of the state at every level of the capitalist economy seemed to yield dividends. As compared to earlier phases of capitalist development, the period of the 1950's and 1960's witnessed a sustained expansion in all the key indicators of economic performance: growth of output, productivity, employment levels and profit-rates. While cyclical crises did not disappear, their range and depth were restricted and their negative consequences for output and employment in particular were dampened.

The situation began to change radically by the end of the 1960's and early 1970's, when the exceptional conditions of the post-war years which had allowed for sustained, if interrupted, growth came to an end. The opportunities offered by post-war reconstruction had been exhausted, and the relative ease with which profits could be generated by extensive exploitation of the Third World countries, or by the interpenetration of the markets of the capitalist countries, could not continue as before. One effect of this was that by the 1960's, US imperialism, which had suffered no war damage at home, and had enjoyed undisputed hegemony in the early post-war period, came under increasing challenge both from Japanese imperialism and the major West European imperialist countries grouped together in the Common Market.

From a period of relative boom and expansion, state-monopoly capitalism entered a period of deepening crisis, conflict and dislocation. The dislocation was manifested in a decline in every important economic indicator that prior to 1970 had registered expansion. Growth and productivity experienced a slow-down, unemployment rose sharply and markets suffered a world-wide contraction. Profits everywhere were cut back. Attempts by the rival monopoly groups, assisted by their respective national governments employing traditional economic policies, to shore up their profit base in conditions of world-wide contraction only made matters worse.

The early 1970's were characterised by sharpened competition in trade and capital exports, by wide interest rate fluctuations and exchange rate upheavals, and by a massive disruption in the world financial system and spiralling inflation. The reverses on the economic front were accompanied by a number of significant political and military defeats for imperialism, the most notable of which was the defeat of US imperialism in Vietnam.

As in previous critical stages of its history, the aggravation of the general crisis of the world capitalist system in the early to mid 1970's served to bring to the fore some new features in its development, as the major monopoly capitalist groups, again helped by their respective capitalist states, sought new ways of removing the constraints on profits imposed by the crisis. For capitalism shows great resilience in its ability to survive crises. It must never be assumed that it will collapse of its own accord and be unable to reverse the gains of the working class made by its struggles.

Features of State-Monopoly Capitalism Today

One important example of recent developments is the way the leading monopolies have, especially since the early 1970's, sought to increase in both scale and content the internationalisation of their production in the effort to boost profits in conditions of extreme upheaval in the world capitalist economy. The result has been a rapid expansion in the size of transnational corporations to the point where they now account for over 30% of total capitalist world output, and over 60% of capitalist world trade. The concentration of wealth within the confines of the leading corporations such as Exxon, General Motors and IBM has reached such proportions that they are today bigger, in terms of value of output, than many capitalist countries including those of the size of Belgium, Austria, or Norway. Behind many of these transnationals stands the power of the big banks and insurance companies, as corporate shareholders and providers of credit. In their drive for maximum profit, these major financial institutions play a guiding role in the accumulation of capital, and in the determination of policy on investment, mergers and disposal of assets.

Although the scale and character of the activities of these transnational corporations may testify to their individual strength, it is important to reiterate that as far as the development of the general capitalist system is concerned, they testify to its weakness and decline. In fact, the rapid expansion of the transnational corporations, so far from helping to reverse capitalism's decline, is on the contrary helping to promote it. This is because, in most countries, the transnationals are rapidly breaking up the established links between productive enterprises, research centres and other sectors of the economy, so that they no longer form interconnected pans of a national economy, but instead become constituent components of the global structures of the different transnationals. What this means is that the increasing internationalism of the world capitalist economy is not proceeding on the basis of balanced, proportional relations between different countries, each specialising in different sectors, but on the basis of interdependent links, straddling national boundaries, between the subsidiaries of the privately owned corporations. The resultant lop-sided development of the various national economies not only has serious consequences for the employment prospects and living standards of their working populations. It also undermines the possibilities, assuming the intention was there, for adopting an integral national economic policy that could reverse the situation. The very existence of transnational corporations, therefore, creates obstacles which democratic governments would have to overcome in implementing the policies on which they were elected.

A second important problem in the current stage of imperialism's development is the effect of the sharply expanded pace of technological advance, particularly in the high-technology intensive areas such as microelectronics, biotechnology and information technology. The application of this new technology produces significant structural and organisational changes in mass production and in control and management procedures.

As with the rapid expansion of the transnational corporations themselves, the current technological revolution was given great impetus by the collapse of the post-war growth period and the onset of a relatively deep and prolonged recession in the world capitalist economy in the early 1970's. Faced with a severe squeeze on profits, and the prospect of fiercer and more ruthless competition, all companies are under pressure to rationalise production, and to cut costs by cutting their labour force. The new technology has offered the transnationals an unparalleled opportunity to do this.

New, more highly automated equipment increases the productivity of the operator, and means that the same output can be produced by fewer workers. Corporations across the world are using microelectronic devices as a tool for massive rationalisation across the whole economy, leaving not a factory or office unaffected. The overall result has been a large increase in unemployment, because unlike previous periods of rapid technological innovation, there is no expanding economy to cushion the blow and reabsorb workers in new growth areas. And of course, in addition to shedding labour and cutting costs, the new technology has resulted in drastic reorganisation and restructuring of existing work processes, giving management the chance to alter the traditional demarcation litres that workers have built up to defend their conditions.

Potentially the new technology based on microelectronics could improve the position of working people, doing away with dreary and tedious tasks and allowing them to work for only a few hours a week without reduction in income. It could mean that enough goods are produced to give everyone in the world a better standard of living. However this is not happening because the transnational corporations and the capitalist governments who develop and control the new technology are not interested in the quality of working people's lives, only in increasing profits.

A third major feature of current developments is the radical change in the methods of state regulation of the economy practised in the major capitalist countries since the Second World War. The world capitalist crisis of the early 1970's served finally to expose the deficiencies of the traditional Keynesian methods of regulation. Attempts to reverse the downturn by measures confined solely to stimulation of private demand only aggravated the deficit in the balance of payments and fuelled inflation.

The new regulatory methods favoured by the most reactionary circles in imperialism switched emphasis away from management of aggregate demand towards promoting structural change in the production base of the capitalist economy. The major policies prominent in the new 'monetarist' strategies, promoted by the Reagan and Thatcher governments in particular, include strict monetary controls and high interest rates accompanied by massive cuts in spending on the social services, extensive tax cuts on monopoly profits and incomes, the lifting of controls on capital flows and exchange rates, and the privatisation of former industries and assets.

The declared aim of these and other similar policies apparently aimed at the general 'deregulation' of the economy, is to strengthen competitive pressures in the economy in order to encourage initiative, innovation and new investment. This rhetoric taken at face value may give the impression that the state is disengaging from the economy, and that state-monopoly capitalism is a thing of the past. The reality however is very different.

The much trumpeted process of 'deregulation' means that the capitalist states are in effect easing or removing the constraints on the ability of the monopoly corporations to exploit working people. This so-called 'deregulation' on one level is accompanied by very much tighter forms of regulation on another, as capitalist states promote policies aimed at directly cutting the wages and living standards of working people, and implement a wide range of more coercive measures designed to undermine organised working class resistance to monopoly exploitation. The anti-union laws and attacks on democratic rights in Britain are important examples of the increased trend towards a more authoritarian and repressive style of government in all the major imperialist countries.

The changes in state regulation procedures, therefore, do not signify the dissolution of state-monopoly capitalism, so much as a further, more defensive and therefore more aggressive phase in its development in response to the sharpening internal contradictions of the imperialist system.

The major result of the above mentioned and other important changes in state-monopoly capitalism since the mid-1970's has been a massive redistribution of wealth and resources from the working people towards the capitalist class, accompanied by a massive concentration of wealth within the monopoly capitalist sector itself. Although it may be the case that some individual groups of working people may continue to benefit from the changes underway, there can be no doubt that in the leading imperialist countries these changes have brought increased hardship and insecurity, as real wages continue to be driven down, job prospects worsen, and social services are cut back. There has also been a qualitative decline in general living standards as educational and cultural standards deteriorate, as health and safety standards are increasingly relaxed in the interests of quick profits, and as the care and protection of the environment is increasingly subordinated to the interests of the capitalist market.

Neo-colonialism

The assault on the living standards and democratic rights of the working class in the capitalist countries is only one counterpart to the enormous wealth and power increasingly concentrated in the hands of the monopoly capitalist sector of the major imperialist countries. The other counterpart is the poverty, starvation, illiteracy and destitution of billions of people in the Third World.

Some of the former colonies have managed to achieve a certain degree of economic advance and expansion since winning national independence. But for most of them the picture is one of continuing economic backwardness and underdevelopment. Although the direct form of colonialism characteristic of the early stages of imperialism has been smashed, it has been replaced by new forms of neo-colonial domination. For example, with the achievement of independence by Third World countries, imperialism today is forced to resort to various alternative methods of political control and coercion. The imposition of dictatorships and support for reactionary or puppet regimes: the presence of military bases and threats of armed intervention: widespread ideological and diplomatic pressures are all frequently used. But the principal features of the system of neocolonialism are the economic forms of subordination and exploitation of Third World countries, which today are much more diverse and involve a more complex interplay of production and financial ties of bondage.

Third World countries still remain on the periphery of imperialism, as suppliers of raw material and cheap labour, as markets for finished goods, and as a vital source of monopoly profits. It is true that a growing proportion of the foreign investment in Third World countries, which previously was located primarily in the agrarian or raw material extractive sectors of their economies, is today located in their emergent industrial sectors. But investment by transnational corporations tends to be of a low-grade type, designed for example, to relocate subsidiaries abroad which heavily pollute the environment, or those which require labour-intensive techniques with low-skill and low-technology content.

The debt problem today is both a vivid expression of imperialism's subjugation of Third World countries, and a powerful lever for promoting it. Third World debt has grown to astronomical proportions. In Latin America, which accounts for over 40% of the total debts the average ratio of debt to the value of national output is about 50%, while for some individual countries it is even higher. Foreign exchange earnings from exports, urgently needed to pay for imports vital to domestic economic development, are instead used to repay the interest charges on debt. In fact, the extortion of debt tribute has become the principal visible means of plundering the wealth of the Third World countries, as interest repayments exceed the repatriation of profits generated in the subsidiaries owned by the transnational corporations.

But aside from its use as a device for extracting vast sums from the developing countries, debt tribute is also used by imperialism as a powerful weapon with which to threaten and undermine national governments, and bend them to the will of the transnational corporations. For example, the stringent conditions attached to loans given by the International Monetary Fund and other institutions include forcing the governments of debtor countries to cut back on economic and social expansion programmes, to devalue their currencies, and to denationalise important sections of their economy and hand them over to foreign private corporations.

Socialism

The national liberation struggle in countries aiming to achieve genuine independence from neo-colonial domination, and the working class fight against monopoly exploitation in the capitalist countries, represent vital aSpects of the anti-imperialist struggle today. But the third vital aspect of this struggle is the construction of an entirely new social system, free from exploitation, in the Soviet Union and the other socialist countries.

The Russian revolution of 1917 established the first socialist state in the world. Today, socialism embraces more than a third of the world's population. The loss of imperialism's world hegemony. and the continued contraction of its sphere of influence, is one of the principal factors which account for its deepening general crisis. Inevitably, imperialism has resorted to all manner of means in order to undermine socialism. The Soviet Union in particular suffered enormous loss of life and material damage in the war of intervention by the combined imperialist powers and once again in the Second World War. And today imperialism continues to exert every effort to roll back socialism. But despite the obstacles and the hardship, the world socialist system continues to exert an important, and sometimes decisive, influence on world affairs, as, for example, in the struggle for peace and disarmament.

Under socialism, the replacement of private with social ownership of the major means of production has laid the basis for genuine equality of opportunity and freedom of initiative for all people, and has provided the potential for substantial material and social gains. In particular, these include the guarantee of employment and housing, the right to free education and health care and access to a range of other social and cultural services and benefits. At the same time the achievements of socialist countries have put them in a position not only to help their own pe0ple but also, at considerable cost to their own domestic development, to provide substantial economic and other forms of assistance to the developing nations, helping them in their aim to break free from imperialist domination.

Of course there have been difficulties in the development of socialism, and there are problems and shortcomings today. But these problems do not mean, as the capitalist media claim, that socialism has failed. Placed in historical perspective some of them are understandable. The Soviet Union, was, after all, the first to chart unnavigated waters in the face of fierce opposition from the imperialist powers. Under these circumstances, the construction of socialism was bound to be difficult, and in such a process mistakes can never be totally excluded. This is not to say, however, that when they occur they are either inevitable or excusable. In fact, the mistakes made, and the crimes to which they led, had serious consequences for the whole socialist movement everywhere. However, the Communist Parties of the socialist countries have had the courage and the honesty to face these harsh realities, to uncover their causes and take steps seeking to overcome them. This contrasts sharply with the hypocrisy and lies with which imperialism, throughout its history, has sought to conceal or justify its massacres and brutal repression of the world's people.

In the Soviet Union, the type of working class mobilisation produced by the revolution, combined with central planning led to rapid industrialisation and the defeat of the fascist invasion. But the growing resort to a bureaucratic and administrative-command system of management progressively stunted the growth of working class and socialist democracy, and seriously hampered the further development of socialism's potential, ultimately leading to economic stagnation. Similar developments occurred in other socialist countries. In some cases, there was an overdependence on loans from the West leading to severe economic disruption.

Currently, in the Soviet Union and a number of other socialist countries, the restructuring of the economy and society is proceeding in conditions of fuller socialist democracy and openness, and there is a determined effort to decentralise decision-making and to promote the initiative and genuine involvement of all working people. To facilitate this, and to reduce inefficiency, greater emphasis is being given in the economic sphere to socialist market mechanisms, cost-accounting, and self-financing. These changes have been accompanied by measures to introduce a greater degree of pluralism and democratic accountability in the political sphere. The process of change is very complex, involving some negative features and even set-backs, which cannot be fully analysed here. Naturally, imperialism has not given up hope of overturning socialism, and has been seeking to exploit the difficulties in order both to gain a foothold and to divide the socialist community and the international Communist movement.

Without underestimating the problems confronting them, we express our support for the working people in the socialist countries in their efforts to achieve the necessary restructuring that will allow socialism to realise its full potential.

The Fight for Peace and Progress

The general picture of the world situation today is one of intensifying contradictions, rapid change and constant realignments of old positions. But at the heart of it all is the fact that the balance of world power continues to tilt away from imperialism and towards the forces for progress and socialism. This is not to underestimate the strength and ability of imperialism to resist and temporarily slow down this process, nor to deny that on occasion, and in certain circumstances, it can regain the initiative. But, equally, it cannot be denied that the transition towards socialism on a world scale continues to be inexorable, with the degree of success ultimately dependent on the continuing unity between the working class in the capitalist countries, the developing countries fighting for national liberation, and the socialist countries.

The unity of the major anti-imperialist forces has already resulted in significant advances being made in many parts of the world. For example many victories have been scored by African people in Angola, Mozambique, Guinea-Bissau, Ethiopia and Zimbabwe. South Africa has been forced through international pressure to recognise Namibia's right to independence, while in South Africa itself the struggle against the apartheid system is being stepped up. In Latin America, Nicaragua has joined Cuba as a liberated zone, although it continues to face the threat of US intervention, while Grenada enjoyed a brief period of freedom from 1979 to 1983, before a US invasion brought liberation to an end. In the Middle East international pressure is building up to force Israel to withdraw from the occupied Arab territories and to recognise the right of the Palestinian peoples to establish their own independent state. In South-East Asia, Vietnam continues to be the primary advocate for socialist and progressive ideas.

Of the many varied responses and retaliatory measures adopted by the US and other imperialist powers to defeat the struggles for progress and national liberation, the most significant and the most dangerous is the escalation of the arms build-up and the continued stockpiling of nuclear weapons in particular. The Soviet peace proposals over the years, and especially since the promotion of glasnost and perestroika, have time and again demonstrated the Soviet Union's fundamental commitment to world peace and security, while imperialism's outright opposition to these proposals, or grudging and reluctant acceptance of them in part, has exposed its interests to be the major cause of the arms build-up.

The warnings issued by a few scientists when the atom bomb was invented have been increasingly justified by further research, culminating in the data about nuclear winter. It is now beyond dispute that a nuclear war would destroy civilisations and possibly all life on earth. The courageous recognition of this forms the basis of the development of Marxist theory referred to as the “new political thinking” in the Soviet Union. As this declares, nuclear war is no longer an option for settling international conflicts, since it is unwinnable, and both sides would be destroyed. The achievement of permanent world peace is therefore not only possible today but essential to the continuation of human life and history.

The US insistence on continuing with the Star Wars project, and on developing and deploying ever more sophisticated nuclear and conventional weapons, is aimed not only at achieving military superiority over the Soviet Union, but also at destabilising international relations generally, and maintaining an atmosphere of tension and hostility. Such an atmosphere is the essential backcloth for maintaining and expanding imperialism's world military presence in the form of bases, fleets, the Rapid Deployment Force etc. And this military presence in turn is seen as crucial to the protection of the vital economic interests of the transnational corporations abroad, particularly in the developing countries. At the same time maintaining international tension is also conducive to the arms export trade, another lucrative source of super-profits for the transnationals standing at the centre of the military-industrial complex in the major imperialist countries.

The arms build-up, fuelled by imperialism's interests, poses a major threat to the survival of humanity, not only because it endangers world peace, but because of the enormous waste that is involved. At a time when resources are desperately needed to combat famine, poverty, homelessness, unemployment, environmental degradation, and a hundred other acute economic and social problems both in the developing countries and in the advanced capitalist countries, vast resources continue to be poured into the research, development and production of new weapons of mass destruction. This represents a criminal diversion of resources unprecedented in the history of humanity.

For all these reasons it is now imperative that all progressive forces in the world today unite their efforts in the struggle for peace and disarmament. Without question the Soviet peace initiatives in the current period offer the best chance for this struggle to be successful. Its bold peace campaign, which has included unilateral halts in nuclear testing and unilateral cuts in weapons and troop deployment, is aimed at securing a nuclear free world by the year 2000.

However, it must be reiterated that the success of the peace campaign will depend not only on the actions and good will of the Soviet people, but on the extent to which other progressive governments in the world can bring pressure to bear on imperialist governments and force them to respond to Soviet initiatives. And in this the people of Britain have a crucial contribution to make.

The Struggle for Environmental and Ecological Security

Success in the campaign for peace and disarmament would release enormous resources for the conquest of poverty, hunger and disease, and for protecting the world's ecology. By opening up a new system of international relations it would make possible co-operation between all states, irrespective of their social system, to deal with the problem of global environmental protection. For this is essentially an international problem, one where the interdependence within the modern world is most apparent.

Today, the stability of the life-support system on our planet is under threat, though the urgent need to tackle the problem is not yet appreciated. The threat arises from a complex of factors, the most important of which are the greenhouse effect, ozone depletion, acid rain, deforestation, desertification, and chemical, agricultural and sewage pollution of the air, of rivers, lakes and the sea. Disposal of toxic wastes from the chemical industry is a serious problem, as is the disposal of radioactive waste, including that left in nuclear plants at the end of their useful life. Pressure on the environment is further aggravated by the explosive growth in population.

An environmentally safe system of energy production does not yet exist. One is urgently needed, since the present system of energy production is a major factor in the changes emerging in the environment. These could become catastrophic as indicated by the greenhouse effect. In dealing with this, greater emphasis will have to be placed on energy conservation, and on the development of renewable resources and nuclear fusion, less reliance on fossil fuels. Cheap public transport will cut down the use of cars and the production of carbon dioxide from the combustion of petrol. The burning of coal will remain a major source of energy for the foreseeable future. It should be British, not imported coal. Fluidised-bed combustion and adequate scrubbing of waste gasses must be introduced to cut down the emission of gasses producing acid rain. But, because of the environmental hazards from nuclear power based on fission, particularly from the disposal of nuclear waste and the problems of decommissioning, existing nuclear plants should be phased out.

We must move towards an overall system of production in which waste products are either eliminated or reduced to an absolute minimum. The atmosphere, the oceans, and the land can no longer be treated as a dust-bin. Waste must either be recycled or used as the starting point for other processes. If this is not possible in a particular process of production, it may be that that process will have to be abandoned or replaced by an alternative process which does not produce unusable waste. And at all times, the effects of human activity on the environment will have to be carefully monitored, and research carried out to deal with problems as they arise. This applies to agriculture as much as to industry.

The change to the sort of closed system of waste-free production to which we have referred is incompatible with the continued existence of an unplanned capitalist economy dominated by the transnationals and the drive for maximum profit. It makes the case for socialism as a system of society where there are no inbuilt obstacles to environmental protection. Private capitalist profit is just such an in-built obstacle. It means that the short-term objective of profit takes precedence over the long-term consequences for the environment. In fact, imperialism's world-wide rush for profit and power has ravaged the environment of the Third World over the last century, and laid the basis for many of today's problems.

It follows that measures to protect the environment must feature prominently in any programme for advance to socialism. But even under socialism, as experience in the socialist countries shows, environmental protection will demand constant vigilance, public awareness and democratic involvement. These are themselves important consequences to be anticipated from the full development of perestroika and glasnost.

To protect the environment calls for the widest possible development of democracy, openness, and accountability. This is a struggle for today. But it is also part of the total struggle for socialism in Britain and the world.