Friday, October 9, 2009

Attack the state not its workers!

Attack the state not its workers!

The call from the agents of the bourgeoisie for further cuts in the pay of public employees as a means of solving the economic crisis on the grounds that they receive better pensions, pay and working conditions than the private sector is not valid.
The state extracts exchange value from the economy in the form of revenue through taxation. As revenue it is not capital but simply exchange value. It constitutes an unproductive deduction of value from the economy if it does not directly contribute to the creation of value. Now some of the tax revenue deducted from the economy is advanced by the state as capital. The state turns some of its revenue into capital by investing it in industry. In this way it makes a direct contribution to the production of surplus value. The part advanced as capital forms part of capitalism's valorisation process. This means that state capital is essentially no different from private capital. On the whole private capital has as its function the maximisation of surplus value.The special role that the state plays does not preclude the existence of state-run commodity producing companies. State run companies are driven by the profit motive too. They seek to produce surplus value at the expense of the working class. They use the exchange value obtained from taxation as capital to produce and sell commodities. This involves the state in the purchase of labour power for use in the production process. Surplus value is generated through the exploitation of labour power. In this way there is no essential difference between workers employed by the state who function as productive workers and the workers employed by private capital. Much of the labour power hired by the Irish state has been used in the valorisation process: CIE workers, ESB workers etc.

Much of the 'state's revenue is used to fund the standing army, the police the bureaucracy, social expenditure etc. While not directly participating in value creation, revenue used in this way supports the capitalist system and thereby the valorisation process. Revenue largely collected in the form of taxation by the state is required to pay for services that ultimately serve the interests of the capitalist class. The maintenance of transport in one way or another, the management of water and sewage, the education of the working class etc. Many of these services are necessary to provide the infrastructure necessary if capital is to function --if it is to sustain and develop itself. Workers need to be available and goods need to be transported and distributed. Otherwise the market for commodities, instead of expanding, contracts and even collapses. Apart from its oppressive role capitalist society would collapse if the state did not provide services, including social services, on the scale apppropriate to its needs. One of the contradictions of capital, as a private social form, is its inability to spontaneously provide public community outside the economic process itself. Hence the need for the political state.

State revenue that fails to contribute to the sustenance of capitalism such as excessive remuneration to the tops of the bureaucracy and other excess constitutes mere waste. It serves no useful purpose neither economically, ideologically nor culturally. Revenue that funds waste constitutes a useless deduction from the value created by a capitalist economy. It tends to put valorisation under greater pressure in the effort to counteract the law of the tendency of the rate of profit to fall. It is in capitalism's ultimate interest to prevent the growth of waste. However it is not always easy to identify waste. Because of its contradictory nature capitalist social relations tend to produce waste --even inordinate amounts of it.

The public sector is very diverse in terms of pension, pay and conditions of work. To lump the public sector workers together on the basis that they all share these conditions is invalid. Public employees range from porters to electronic engineers, architects, departmental secretaries, judges and generals. As to be expected under capitalism the pay and conditions of work between these different categories of state employees is very different.

Neither can the private sector be reduced to one entity for the purpose of comparing pensions, pay and working conditions between the state and non state employees. The non-state sector is even more diverse. Private employees can be employed by different kinds of employers under diverse conditions. Some capitalist may be extremely large, other less large and then others very small.

To make a distinction between public sector employees and private sector employees in terms of job security, pay and conditions of work is not acceptable. It is not valid to conclude that state employees have better job security, pay and conditions of work than the latter. There are employees in the private sector with much better job security, pay and conditions of work than in the public sector --senior managers and professionals such as engineers and marketing people. Furthermore they are two qualitatively distinct spheres and cannot be validly compared with each other.

It is constantly been claimed across the bourgeois mass media that state employees have better pensions, pay and conditions of work. But this is an unsupported simplification. Within individual companies these conditions are diverse. Senior management are not employed on the same basis as other employees. Along with this some companies based in Ireland have beeen affected more adversely by the depression than others. Some, if not many, of these companies pay relatively higher wages and provide better conditions of work. This is because they are relatively very capital intensive. Many of their employees would have spent most if not all of their adult life working for such companies. These employees have better conditions than many public employees. Many of these differences are due to the power of the market. The law of value can determine how workers are treated by employers. Given the market conditions it can suit oligopolies to provide their workers with relatively better pay and conditions of work than are found elsewhere. The private sector is a diverse sector. It consists of diverse branches of production. Indeed as with public sector employees many private sector employees are non-productive workers too. It consists of strong and weak enterprises and big and small. Conditions concerning pensions, pay and conditions are correspondingly diverse. Many private employees have better pensions, pay and working conditions than many public employees. Just because many private employees have lost their jobs and suffered pay reductions does not mean that all private employees are suffering the same fate. Many parts of the private sector are still cushioned from the more acute effects of the economic crisis. Yet there is no campaign calling for further pay reductions against employees in these sectors. The populist campaign leveled against public sector employees is a campaign grounded in irrationalist reactionary ideology.

The working class is constantly being bombarded with bourgeois propaganda. It is told that the state is living way beyond its means in its day-to-day spending. Therefore, it is concluded, that the state has to cutback on expenditure to keep the Irish economy solvent. The conclusion drawn is that by cutting back on pay as opposed to services the services can be maintained. Public workers are to
be forced to pay for the economic crisis. Many state and non state employees live within the same family or household. In many of these cases the non-state employees suffering income falls may indirectly adversely affect the state employees belonging to the same family or household. The reverse situation is also true. It is said that there is no choice but to make public workers pay for for the state deficit. But apologists for capitalism are not calling on the super-paid higly affluent public/private employees annually earning hundreds of thousands of Euros to pay for it. This tactic represents the thin end of the wedge. It constitutes part of a sustained attack on the working class as a whole. The target is the defeat of the entire working class. It is hoped that this approach will deal such a blow to the more organized section of the working class that it will lead to the implosion of the working class thereby rendering a general assault on the entire working class much easier to achieve.

The call from the agents of the bourgeoisie for further cuts in the pay of public employees as a means of solving the economic crisis on the grounds that they receive better pensions, pay and working conditions than the private sector is not valid. As I have indicated the private cannot be compared with the public because like is not being compared with like.The private sector consists of diverse enterprises: large and small capitalists; small retail outlets; non-capitalist farmers; sub-contractors; landlords; celebs; publicans; trade unions charities; political parties and artists. Many of the aforementioned are non-capitalist entrprises. Furthermore the heterogeneity of conditions of employment within the state sector makes such generalizations concerning pay determination invalid.

The world capitalist crisis that has hit Ireland is a result of the inherent limited nature of the capitalist mode of production. Capitalism of necessity produces crises. The only way to put an end to such crises is by eliminating capitalism and replacing it with a communist society. There are only two options facing the Irish working class. One is a solution to the crisis at the expense of the working class. The other is a social revolution at the expense of the capitalist class. Compromise is an impossibility. The workers have no choice but to choose one or the other. This choice will determine the character of the Irish economy for years into the future.

Paddy Hackett

Monday, October 5, 2009

Communism and the nationalisation of Irish banks

The nationalization of the banks of the economy of a country is basically a nationalist policy. Nationalism and the nationalization of the banks are one and the same. This is why the Eire Nua programme of Provisional Sinn Fein, if my memory serves me right, could happily call for the nationalization of the banks. It is not a revolutionary communist position.

Communists are internationalists and thereby support the socialization of the forces of production on a world basis. Consequently they don't support nationalist solutions to what are global problems. Nationalizing the banks is a policy that can be realised within the context of capitalism. It is not a communist policy. Bank nationalisation does not necessarily solve the problems of the working class. Banks may be nationalised and yet fail to meet the most basic and obvious needs of the working class. Nationalised banks can be just as ruthless and merciless in their relations with their working class clients as any private bank. There have been state companies that produce commodities yet fail miserably to show compassion towards the working class. This because, like all capitalist enterprises they are the subjects of the law of value.

Even with the nationalisation of the banking system the banks must still observe the laws of capitalism. Otherwise they go out of business. They cannot, simply because they are nationalised, transcend the law of value. Nationalised banking is sometimes the preferred policy of the bourgeoisie or at least sections of it. Even if nationalised banks are still involved with the money-form --with capital in the form of money. Likewise they they are subsumed under credit relations.The latter are inseparably based on the money relation.The money relation is based on the circulation of commodities and in particular the circulation of capital in the form of commodities. The circulation of commodity capital is in turn rooted in the valorisation process. This being so the banking system implies the capitalist reproduction process.

State banks under workers control is a paradox. Because of their very nature state banks can never be authentically under workers' control. It is like saying that capitalism can be under workers' control. If banks can be subjected to the democratic control of the working class then so too can capitalism. Then communism cannot be a historical necessity. Capital by its very nature precludes its subjection to the control of workers. Trotskyism, inspired by Trotsky's 1938 transitional programme, has made nationalisation under workers' control a important plank in its programme. The 1938 transitional programme attempts to go beyond the minimum/maximum programmatic framework. But the former is a flawed programme that merely reinforces confusion within the working class movement. There can be only be communist programmes. Communist programmes always make it clear that communism is the aim --not socialism. Communism necessarily entails a state-free classless society.

Communists can only logically promote communist social relations. Communists social relations by definition transcend the relations of capital: bank relations, money relations and of course value relations in general. Communist relations preclude the existence of banks and the exchange value they express. Communist relations constitute the antithesis to bank relations whether private or public. The former are directly visible relations while the later are relations of reification. Consequently commodities cannot exist under communism. Products cannot assume the form of commodities under communist relations. They are just products. Consequently money and banks are superfluous. Goods are produced and distributed according to the popular democratic decisions of the community.

Even some figures within Stalinism and Trotskyism are aware that any nationalisation of banks carried by the Irish government under current conditions is not nationalisation in the sense that Lenin and Trotsky would have meant. Some call it a phony nationalisation.Dan La Botz writing for Monthly Review says that

"Bank nationalizations in reality, however, have usually just been a stage in the boom-bust cycles of modern economies, a period when the state lends its strength to finance to see it through hard times, and once finance has recuperated, the state returns it to its private owners so they can continue to reap the benefits of wealth plus interest."

I shall end this piece with a quotation from Engels:

"But of late, since Bismarck went in for state ownership of industrial establishments, a kind of spurious socialism has arisen, degenerating now, and again, into something of flunkeyism, that without more ado declares all state ownership, even of the Bismarckian sort, to be socialistic. Certainly, if the taking over by the state of the tobacco industry is socialistic, then Napoleon and Metternich must be numbered among the founders of socialism."

Paddy Hackett