Muammar Gaddafi

The Solution of the Economic Problem: Socialism

THE ECONOMIC BASIS OF THE
THIRD UNIVERSAL THEORY

Important historical developments contributing to the solution of the problem of work and wages - the relationship between producers and owners, workers and employers - have occurred in recent history. These developments include the determination of fixed working hours, overtime pay, leaves, minimal wages, profit sharing, the participation of workers in administration, the banning of arbitrary dismissal, social security, the right to strike, and other provisions contained in labour codes of almost all contemporary legislation. Of no less significance are changes in the realm of ownership, such as the enactment of laws transferring private ownership to the state, and also those limiting income. Despite these not inconsiderable developments in the history of economics, the problem still fundamentally exists, even though it has been made less severe than in past centuries through improvements, refinements and developments that have brought many benefits to the workers.

However, the economic problem still persists unsolved in the world. Attempts aimed at ownership have failed to solve the problems of producers. They are still wage-earners, despite the state ownership which may vary from the extreme right to the extreme left to the centre of the political spectrum.

Attempts to improve wages were equally significant to those that were aimed at the transferral of ownership. In the wake of the Industrial Revolution, benefits from wage negotiations secured for workers certain privileges that were guaranteed by legislation and protected by trade unions, thus improving the lot of the workers. As time passed, workers, technicians, and administrators have acquired certain rights which were previously unattainable. However, in reality, the economic problem still exists.

Attempts that were aimed at wages were contrived and reformative, and have failed to provide a solution. They were more of a charity than a recognition of the rights of the workers. Why do workers receive wages? Because they carry out a production process for the benefit of others who hire them to produce a certain product. In this case, they do not consume what they produce; rather, they are compelled to concede their product for wages. Hence, the sound rule: those who produce consume. Wage-earners, however improved their wages may be, are a type of slave.

Wage-earners are but slaves to the masters who hire them. They are temporary slaves, and their slavery lasts as long as they work for wages from employers, be they individuals or the state. The workers' relationship to the owner or the productive establishment, and to their own interests, is similar under all prevailing conditions in the world today, regardless of whether ownership is right or left. Even publicly-owned establishments give workers wages as well as other social benefits, similar to the charity endowed by the rich owners of economic establishments upon those who work for them.

Unlike the privately-owned establishment where income benefits the owner, the claim that the income from the public-owned establishment benefits all of the society, including the workers, is true only if we take into consideration the general welfare of the society and not the private well-being of the workers. Further, we would have to assume that the political authority controlling ownership is that of all the people, practised through the Popular Conferences and People's Committees, and not the authority of one class, one party, several parties, one sect, tribe, family, individual, or any form of representative authority. Failing this, what is received directly by the workers with respect to their own interests, in the form of wages, percentage of profits or social benefits, is the same as that received by workers in a private corporation. In both instances, the producers are wage-earners, despite the difference in ownership. Thus, this change in ownership has not solved the problem of the producer's right to benefit directly from what he produces, and not through the society nor through wages. The proof thereof is the fact that producers are still wage-earners despite the change in this state of ownership.

The ultimate solution lies in abolishing the wage-system, emancipating people from its bondage and reverting to the natural laws which defined relationships before the emergence of classes, forms of governments and man-made laws. These natural rules are the only measures that ought to govern human relations.

These natural rules have produced natural socialism based on equality among the components of economic production, and have maintained public consumption almost equal to natural production among individuals. The exploitation of man by man and the possession by some individuals of more of the general wealth than their needs required is a manifest departure from the natural rule and the beginning of distortion and corruption in the life of the human community. It heralds the start of the exploitative society.

If we analyse the factors of economic production from ancient times to the present, we always find that they essentially consist of certain basic production components, i.e., raw materials, means of production, and a producer. The natural rule of equality requires that each of these components receives a share of this production. Because production cannot be achieved without the essential role of each of these components, it has to be equally divided amongst them. The preponderance of one of them contravenes the natural rule of equality and becomes an encroachment upon the others' rights. Thus, each must be awarded an equal share, regardless of the number of components in the process of production. If the components are two, each receives half of the production; if three, then one-third.

Applying this natural rule to both ancient and modern situations, we arrive at the following. At the stage of manual production, the process of production resulted from raw material and a producer. Later, new means of production were added to the process. Animals, utilized as power units, constitute a good example. Gradually, machines replaced animals, types and amounts of raw materials evolved from the simple and inexpensive to the valuable and complex. Likewise, the unskilled workers became skilled workers and engineers; their former huge numbers dwindling to a few specialized technicians.

Despite the fact that components have qualitatively and quantitatively changed, their essential role in production has remained basically unaltered. For example, iron ore, a component of both past and present production, was manufactured primitively by iron smiths into knives, axes, spears, etc. The same iron ore is now manufactured by engineers and technicians by means of smelting furnaces into all kinds of machines, engines and vehicles. The animal - horse, mule, camel, or the like - which was a component of production, has been replaced by factories and huge machines. Production, based upon primitive tools, is now founded upon sophisticated technical instruments. Despite these tremendous changes, the components of natural production remain basically the same. This consistency inevitably necessitates returning to sound natural rules to solve the economic problems that are the result of all previous historical attempts to formulate solutions that ignore these rules.

All previous historical theories tackled the economic problem either from the angle of ownership of any of the components of production, or from that of wages for production. They failed to solve the real problem; the problem of production itself. Thus, the most important characteristic of economic order prevailing in the world today is a wage system that deprives the workers of any right to the products being produced, be it for the society or for a private establishment.

An industrial establishment is composed of material for production, machines and workers. Production is achieved by workers manufacturing materials and using machines. Thus, manufactured goods would not have been ready for use and consumption had they not gone through a production process requiring raw materials, factories, and workers. Clearly, without basic raw materials, the factory cannot operate and without the factory, raw materials will not be manufactured. Likewise, without producers, the factory comes to a halt. Thus, the three factors are equally essential to the process of production, and without them there can be no production. The absence of any one of these components cannot be replaced by the others. Therefore, the natural rule necessitates each component receiving an equal share of the benefits of production. It is not only the factory that is important, but those who consume its production as well.

The same is applicable to agricultural production processes resulting from only two components: man and land. The product must be divided equally into two shares congruent with the number of production components. Furthermore, if any additional mode, mechanical or otherwise is utilized in the process, production must be equally divided into three shares: the land, the farmer, and the means of production. Consequently, a socialist system emerges under which all production processes are governed by this natural rule.

The producers are the workers; they are called producers because the terms "worker," "labourer," and "toiler" have become invalid. The traditional definition is revised because workers are undergoing qualitative and quantitative changes. The working class is declining proportionately to the advancement of science and technology.

Tasks once performed by a number of workers are now being carried out by a single machine. Operating a machine requires fewer workers; this has brought about a quantitative change in the labour force, while the replacement of physical force by technical skill has resulted in a qualitative change in the labour force.

The labour force has become a component of the production process. As a result of technical advancement, multitudes of unskilled toilers have been transformed into limited numbers of technicians, engineers and scientists. Consequently, trade unions will subsequently disappear and be replaced by syndicates of engineers and technicians. Scientific advancement is an irreversible gain for humankind. Thanks to this process, illiteracy will be eliminated and unskilled workers will become a temporary phenomenon destined to gradual disappearance. However, even in this new environment, persons will always remain the basic component in the production process.

NEED

The freedom of a human being is lacking if his or her needs are controlled by others, for need may lead to the enslavement of one person by another. Furthermore, exploitation is caused by need. Need is an intrinsic problem and conflict is initiated by the control of one's needs by another.

HOUSING

Housing is an essential need for both the individual and the family and should not be owned by others. Living in another's house, whether paying rent or not, compromises freedom. Attempts made by various countries to solve the housing problem did not provide a definite solution because such attempts did not target the ultimate solution - the necessity that people own their dwellings - but rather offered the reduction, increase, or standardization of rent, whether it went to privately or publicly-owned enterprise. In a socialist society, no one, including society itself, has the right to control people's needs. No one has the right to acquire a house additional to his or her own dwelling and that of his or her heirs for the purpose of renting it because this additional house is, in fact, a need of someone else. Acquiring it for such a purpose is the beginning of controlling the needs of others, and "in need freedom is latent".

INCOME

Income is an imperative need for man. In a socialist society, it should not be in the form of wages from any source or charity from any one. In this society, there are no wage-earners, but only partners. One's income is a private matter and should either be managed privately to meet one's needs or be a share from a production process of which one is an essential component. It should not be a wage in return for production.

MEANS OF TRANSPORTATION

Transportation is also a necessity both to the individual and to the family. It should not be owned by others. In a socialist society, no person or authority has the right to own a means of transportation for the purpose of renting it, for this also means controlling the needs of others.

LAND

Land is the private property of none. Rather, everyone has the right to beneficially utilize it by working, farming or pasturing as long as he and his heirs live on it - to satisfy their needs, but without employing others with or without a wage. If lands were privately owned, only the living would have a share in it.

Land is permanent, while those who benefit from the land undergo, in the course of time, changes in profession, capabilities and existence.

The aspiration of the new socialist society is to create a society which is happy because it is free. This can only be achieved by satisfying, man's material and spiritual needs, and that, in turn, comes about through the liberation of these needs from the control of others. Satisfaction of these needs must be attained without exploiting or enslaving others; otherwise, the aspirations of the new socialist society are contradicted.

Thus, the citizen in this new society secures his material needs either through self-employment, or by being a partner in a collectively-owned establishment, or by rendering public service to society which, in return, provides for his material needs.

Economic activity in the new socialist society is a productive one aimed at the satisfaction of material needs. It is not an unproductive activity, nor one which seeks profit for surplus savings beyond the satisfaction of such needs. This, according to the new socialist basis, is unacceptable. The legitimate purpose for private economic activities is only to satisfy one's needs because the wealth of the world, as well as that of each individual society, is finite at each stage. No one has the right to undertake an economic activity whereby wealth exceeding the satisfaction of one's needs can be amassed. Such accumulations are, in fact, the deprived right of others. One only has the right to save from his own production and not by employing others, or to save at the expense of his or her own needs and not of others. If economic activity is allowed to extend beyond the satisfaction of needs, some will acquire more than required for their needs while others will be deprived. The savings which are in excess of one's needs are another person's share of the wealth of society. Allowing private economic activity to amass wealth beyond the satisfaction of one's needs and employing others to satisfy one's needs or beyond, or to secure savings, is the very essence of exploitation.

Work for wages, in addition to being enslavement as previously mentioned, is void of incentives because the producer is a wage-earner and not a partner. Self-employed persons are undoubtedly devoted to their work because from it they satisfy their material needs. Likewise, those who work in a collective establishment are also devoted to their work because they are partners in it and they satisfy their material needs from the production. Whoever works for a wage, on the other hand, has little incentive to work.

Work for wages has failed to solve the problem of motivation for increasing and developing production. Whether it is a service or goods production, work for wages is continuously deteriorating because it is performed by unmotivated wage-earners.

EXAMPLES OF WAGE-LABOUR: FOR THE SOCIETY, FOR PRIVATE ENTERPRISE, AND SELF-EMPLOYMENT:

First example:

(a) A worker produces ten apples for society. The society gives him one apple for his production and it fully satisfies his needs.

(b) A worker produces ten apples for society. The society gives him one apple for his production which does not satisfy his needs.

Second example:

A worker produces ten apples for another person and gets wages less than the price of one apple.

Third example:

A worker produces ten apples for himself.

The conclusion:

In the first example (a), because the worker's wages are limited to one unit which satisfies his needs, he has no incentive to increase his production. Thus, all the labour force that works for society is psychologically apathetic.

(b) The worker has no incentive even to produce because he cannot satisfy his needs from the wages. However, he continues working without any incentives because generally, like all members, he is forced to acquiesce to the working conditions of the society.

In the second example, the worker works basically to get wages and not to produce. Since his wages cannot satisfy his needs, the choices are either to look for another master to get a better price for his work, or be forced, as a matter of survival, to remain where he is.

In the third example, the self-employed alone is the one who produces eagerly and voluntarily.

In a socialist society, there is no possibility for private production to exceed the satisfaction of one's needs because satisfaction of needs at the expense or by means of others is not permitted. Moreover, socialist establishments operate only for the satisfaction of the needs of society. Accordingly, the third example demonstrates the sound basis of its economic production.

However, in all instances, even the bad ones production is associated with survival. The proof thereof is that, even though in capitalist societies production accumulates and expands in the hands of only a few owners who do not work but exploit the efforts of others, the toilers are still forced to produce in order to survive. However, THE GREEN BOOK not only solves the problem of material production but also prescribes a comprehensive solution for the problems facing human societies so that individuals may be totally liberated, materially and spiritually, in order to attain their happiness.

Other examples:

If we assume that the wealth of a society is ten units and its inhabitants are ten persons, then the share of each member is one-tenth of the total one unit per person. If some members of this society get more than one unit each, then a certain number from the society get nothing. Their share of the wealth of their society has been acquired by others. Hence, the presence of rich and poor in an exploitative society. Let us also suppose that five members of that particular society each own two units. In such a case, half of the society is deprived of their rights to the wealth of their society, for what should be theirs has been acquired by others.

If an individual of that society needs only one of the units of the wealth of the society to satisfy his needs, then those who possess more than one unit are, in fact, seizing the rights of other members of the society. Because the one unit is all that is required to satisfy the needs of an individual, the additional units are acquired for the purpose of savings. This can only be achieved at the expense of the needs of others; the acquisition of others' share in this wealth. This is the reason behind the existence of those who hoard and do not spend; those who save beyond the satisfaction of their needs; and the existence of those who beg and are deprived of their right to the wealth of the society and do not find enough to consume. Such is an act of plunder and theft, yet according to the unjust and exploitative rules governing such a society, it is legitimate and overt.

Any surplus beyond the satisfaction of needs should ultimately belong to all members of society. Individuals, however, have a right to effect savings from the share allocated to their own needs since it is the amassing of wealth beyond the satisfaction of one's needs that is an encroachment upon public wealth.

The industrious and skilful in a society have no right, as a result of this advantage, to take from the shares of others. They can use their talents to satisfy their own needs and save from those needs. Like any other member of the society, the aged and the mentally and physically disabled should have their fair share of the wealth of the society.

The wealth of a society may be likened to a supply establishment or a store providing a certain number of people with daily rations satisfying their needs. Each person has a right to save from such provisions what he wants, i.e., to consume or save whatever portions of his share he decides, utilizing his talents and skill for such purposes. However, those who use their talents to acquire excessively from the "supply establishment" are undoubtedly thieves. Therefore, those using their skill to acquire wealth exceeding the satisfaction of their needs are, in fact, infringing upon the public right, namely, the wealth of society which is like the store in the said example.

Disparity in the wealth of individuals in the new socialist society is not tolerated, save for those rendering certain services to the society for which they are accorded an amount congruent with their services. Individual shares only differ relative to the amount of production or public service rendered in excess.

Hence, human experiences through history have produced a new experiment in a unique attempt to culminate the struggle of persons to complete their freedom, to achieve happiness through satisfying their needs, to ward off exploitation by others, to put an end to tyranny, and to find a method to distribute the wealth of the society equitably, without exploiting others or compromising their needs. It is the theory of the fulfilment of needs for the emancipation of humanity.

The new socialist society is but a dialectical outcome of the unjust relationships prevailing in the world today. The new socialist society will introduce the natural solution - privately-owned property to satisfy one's needs without exploitation, and collective property in which the producers are partners replacing private enterprise, which is based on the production of others without recognizing their right to a just share of the product.

Whoever possesses the house in which you dwell, the vehicle in which you ride or the income on which you live, possesses your freedom, or part of it. Freedom is indivisible. For people to be happy, they must be free, and to be free, they must possess the possibility of satisfying their own needs. Whoever possesses the means of fulfilling your needs controls or exploits you, and may enslave you despite any legislation to the contrary.

The material needs of people that are basic and personal start with food, housing, clothing and transport and must be regarded as private and sacred and their satisfaction should not depend on hire.

To satisfy these material needs through rent, gives the original owner the right to interfere in your personal life and to control your imperative needs, even if the original owner be the society in general. The original owner can usurp your freedom and take away your happiness. The interference of the original owner may include repossessing your clothes, even leaving you naked on the street. Likewise, the owner of your means of transportation may leave you stranded on the sidewalk, and the owner of your house may make you homeless.

People's imperative needs cannot be regulated by legal or administrative procedures. They must be fundamentally implanted into the society in accordance with natural rules.

The aim of the socialist society is the happiness of the human being, which cannot be attained except by the establishment of one's material, and spiritual freedom. The achievement of freedom depends on the private and sacred attainment of man's needs. One's needs should not be under the domination of others and should not be subject to plunder by any source in society, otherwise one will live in insecurity. Deprivation of the means of fulfilment compromises freedom because, in attempting to satisfy basic needs, one would be subject to the interference of outside forces in one's basic interests.

The transformation of existing societies of wage-earners into those of partners is inevitable as a dialectical outcome of the contradictory economic theories prevailing in the world today. It is also a dialectical outcome of the unjust relationship based on the wage system. None of these issues have been resolved to date.

The antagonistic force of the trade unions in the capitalist world is capable of replacing capitalistic wage societies by a society of partnerships. The possibility of a socialist revolution starts by producers taking over their share of the production. Consequently, the aims of the producers' strikes will change from demanding increases in wages to controlling their share in production. Guided by THE GREEN BOOK , this will sooner or later take place. The final step is for the new socialist society to reach a stage in which profit and money disappear. Society will become fully productive; the material needs of society will be met. In this final stage, profit will disappear, as will the need for money.

The recognition of profit is an acknowledgment of exploitation, for profit has no limit. Attempts so far to limit profit by various means have been reformative, not radical, intending to prohibit exploitation of man by man. The final solution lies in eradicating profit, but because profit is the dynamic force behind the economic process, eliminating profit is not a matter of decree but, rather, an outcome of the evolving socialist process. This solution can be attained when the material satisfaction of the needs of society and its members is achieved. Work to increase profit will itself lead to its final eradication.

DOMESTIC SERVANTS

Domestic servants, paid or unpaid, are a type of slave. Indeed, they are the slaves of the modern age.

Since the new socialist society is based on partnership and not on a wage system, natural socialist rules do not apply to domestic servants because they render services rather than production. Services have no tangible material product and cannot be divided into shares according to the natural socialist rule.

Domestic servants have no alternative but to work for wages, or even be unpaid in the worst of situations. As wage-earners are a type of slave and their slavery exists as long as they work for wages, domestic servants, whose position is lower than that of wage-earners in economic establishments and corporations, have an even greater need to be emancipated from the society of wage-labour and the society of slaves.

Domestic servants is a phenomenon that comes next to slavery.

The Third Universal Theory heralds emancipation from the fetters of injustice, despotism, exploitation, and economic and political hegemony, for the purpose of establishing a society of all the people where all are free and share equally in authority, wealth and arms. Freedom will then triumph definitively and universally.

THE GREEN BOOK thus defines the path of liberation to masses of wage-earners and domestic servants in order that human beings may achieve freedom. The struggle to liberate domestic servants from their status of slavery and to transform them into partners, where their material production can be divided into its necessary basic components, is an inevitable process. Households should be serviced by their habitants. Essential household services should not be performed by domestic servants, paid or unpaid, but by employees who can be promoted in rendering their services and can enjoy social and material benefits as any other public employee would.

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