ALB
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By coincidence, looking for something for the 50 Years Ago column for the December Socialist Standard, there was an article (a reply to a letter) in December 1972 about a similar situation in the past when workers were faced with a huge increase in their cost of living that they could not pay — in this case sky rocketing rents during WW1.
Here what happened:
“On the question of what happened in Glasgow in 1915 having “nothing to do with house building having ceased”, we quote from Housing Finance and Development by A. J. Merrett and Allen Sykes (Longmans, 1965). In the opening chapter they say:
“House building virtually ceased with the advent of war and rents began to rise, particularly in munitions-producing areas. This provoked an outcry such that in 1915 the government passed the first rent restriction Act — the Increase of Rent and Mortgage Interest (War Restrictions) Act, 1915. It froze the rents of all unfurnished tenancies (approximately 85 per cent of the total) below certain limits at the August 1914 level, and landlords were virtually forbidden to evict protected tenants save for obvious defaults such as non-payment of rent.”
This passage also makes clear that Braddock’s assertion in his second paragraph is untrue. It is correct only in the technical sense that — of course — tenants could not be forced to pay rent raised above the level permitted by their wages, i.e. to produce money they had not got. The alternative to the 1915 Act would have been for the government to let wages go up to meet increasing rents; instead, the Act restrained wage demands by keeping rents low — and provided also that workers, in Glasgow or anywhere else, were forced to pay them. Braddock appears not to realize that this “blow against landlords”, as he called it in his previous letter, was struck not by the workers but by the government in the wider interests of capitalism.“ (emphasis added).
The parallel with today is that, if nothing was done, workers would have been forced to cut back on food and thus would affect their working efficiency. To maintain this, employers would have to pay them higher wages.
There will be an element of this in the government lowering the cap on energy price rises — this will reduce the pressure on employers to pay higher wages. And it is by no means a blow against either the utility companies (their profit margins are maintained) or the energy producing companies (with no windfall tax they lose nothing).
This of course is not new but was announced by the previous Chancellor in May and will already have been paid to nearly all of those eligible.
It was partly financed by a windfall tax on the profits of some energy companies. In other words, it was partly paid for by that section of the capitalist class, as opposed to being borne by the capitalist class as a whole out of general taxation or borrowing.
https://amp.theguardian.com/politics/2022/may/26/sunak-announces-windfall-tax-energy-firms
Who should pay for further support measures was a big issue in the Tory leadership race with Truss making it clear that it should not be by the energy companies. It will be interesting — and perhaps revealing — to see, when the expenses for the campaign are published, exactly who financed hers.
Yes, Varouflakis makes a valid point. As there is only one electricity grid and only one gas grid (and we could add, only one railway network) creating a market to supply gas and electricity on which different private enterprise compete doesn’t make sense even from a capitalist point of view. That of course is why they were nationalised in the first place and run as a single state-capitalist concern (electricity by a Tory government in 1925).
Apart from that, there are some ideas in what he says that Don’t Pay might find useful in their quest for a “fair price for power”.
The Greens as war-mongerers. We knew they weren’t against capitalism but personally I didn’t expect they would go this far;
But there you are. Maybe they want the tanks to be powered by renewal energy.
Ps can’t we move the marginal (to this thread) dealing with TrueStalinist to a new thread of its own.
The proposal to change the British (or any other, for that matter) capitalist state from a constitutional monarchy to a republic is a complete irrelevance. In fact it must be near the top of the list of irrelevant reforms. Unlike Scotland breaking away (with or without the same king) which it also irrelevant, it wouldn’t even temporarily disrupt people’s life. It wouldn’t make the slightest difference to that whatsoever.
If republicans want a radical, revolutionary change, they should go for socialism where, of course, there won’t be a monarch if that’s their main concern.
Apologies. I mistakenly assumed that you were an activist in Don’t Pay and went along with their view that the permanent solution is “a fair price for power”. I can now see that, in rejecting the idea of a permanent solution under capitalism, you are ahead of them.
I am not so sure, though, that, in arguing that socialism is a pipe dream and reformism is the only game in town, you are ahead of them on this.
The wording on their website suggests that they are against the profit system and so may well want to replace by some other system. It is true that the emphasis is on opposing “profiteering” rather than against profit-making but that might just be populist talk to gain the support of those just against the high cost of their gas and electricity.
They might have made a better case if they had said “don’t pay but don’t have any illusions about a ‘fair’ price; the only permanent solution is the end of the profit system and its replacement by a system of production directly for use based on the common ownership and democratic control of society’s productive resources.”
It’s how profits are divided amongst the capitalist class that’s not our problem.
Of course the rise in the cost of the gas and electricity is a problem for us as it reduces our standard of living.
You still haven’t said what your “permanent” solution to this problem is beyond a vague reference to a “fair price for power”.
Hope you are not suggesting that we should take sides in the capitalist dispute over who should pay for the subsidised price from 1 October.
The headline is a nice publicity for Centrica but it seems to be a policy of spreading the windfall profits over a number of years rather than reaping them all this year. As the article says:
“However, the Resolution Foundation has warned that the policy risked “delaying but locking in” windfall gains. There are concerns that the government negotiating team, led by the former head of the vaccines taskforce, Madelaine McTernan, is in a weak position as it will need to convince generators to forgo high short-term prices.“
But of course this is a problem for the capitalist class not us.
Thanks. I saw that too but it was written before the exact details were announced and the government was still toying with the idea of allowing the utility companies to increase bills for the next 20 years to enable them to repay loans to them. At least that it what I take “we are the ones who will pay for it for years to come” to be a reference to. Surely they can’t be referring to the extra interest on the National Debt that the Taxpayers Alliance is going on about, can they?
There are also signs of delusions of grandeur:
“The threat of 180,000 of us pledging to strike has already forced the government to act.”
Certainly, to try to allay working class discontent and avoid the threat of widespread social unrest will have been a factor in the government’s decision, but for Don’t Pay to claim the whole credit for this for their marginal campaign is a cheek.
There was a general understanding even amongst supporters of capitalism that something had to be done, as it had been in other European countries. In fact, if it hadn’t been for the distraction of the Tory leadership race, would no doubt have been done earlier. It was just a question of what the details were going to be.
As YMS pointed out on another thread, there is a dispute amongst the capitalist class as to how it was to be paid for — by the capitalist class as a whole through the National Debt or by the big gas producers by a tax on their profits.
In the event, the government decided to let the gas producers keep their windfall profits. Though they are making a pathetic attempt to get others who have benefitted (companies supplying electricity from other sources than burning gas) by politely asking them to forgo windfall profits:
But as the article says the generators are “likely to seek very attractive terms to compensate them for forgoing high prices now” and are in a strong bargaining position to get this.
He knows about us and our position as 3 years ago three of us had a discussion with him in a pub after a meeting at which he spoke.
Wednesday 6 November: Marx, Ecology and the Climate Emergency
There can’t be any objection to Wolff putting his case in simple, clear terms without going into the deeper theory behind it every time. After all, that is what we do when stating our case.
It’s the theory behind what he advocates that is mistaken. As pointed out in post #231446 above, in a book he co-authored in 2002 he states that exploitation takes place at enterprise level and concludes that, therefore, the way to end it is through worker ownership at enterprise level.
His mistake is in assuming that exploitation takes place at enterprise level, that workers are exploited only by their immediate employer. In one sense, of course, it does since that is where surplus value is extracted but, as Marx explains in the first part of volume 3 of Capital, due to the averaging of the rate of profit the whole capitalist class exploits the whole working class. The conclusion to be drawn from this is that exploitation can only be ended at society-wide level by making productive resources the common ownership of society as a whole.
Wolff’s theoretical mistake leads him to see a economy based on workers cooperatives producing for sale as the way-out. It isn’t and it wouldn’t be socialism either. It is something we need to expose and oppose as a non-solution.
That reminds me. Whatever happened to the pamphlet on workers coops that Alan drafted a couple of years ago?
This event can be seen as symbolic. It marks the end of an illusion and will be the last time the rest of the world takes an interest in the death of a British monarch.
From now on appearance and reality will coincide. The rest of the world will openly recognise Britain as the second-class power it has long been — since in fact a few years into the last monarch’s reign, in 1956, the US told Britain to call off its invasion of Egypt and occupation of the Suez Canal. Britain will be treated as just another Scandinavian monarchy where the change of monarch is of no particular significance. Who is the king of Denmark? Canute? Hamlet?
Imperialist posturing by British politicians, with their talk of “Global Britain” and the like, may take somewhat longer to die out.
We also dealt with this argument a few months ago:
As the graph in that Guardian article shows, the price cap will go up from £1971 in S22 to £2500 in Q4 22. Note also it is nearly double what it was last winter.
This, I suppose, is a measure of the pain the government considers acceptable to inflict on workers to support Ukraine in its war with Russia.
Will Don’t Pay still be advising consumers not to pay the increase? Or do they consider it an acceptable concession?
