1920s >> 1929 >> no-294-february-1929

The Economic League On Capital

In our January issue I dealt sympathetically with “Some Socialist Fallacies Exploded”—a leaflet issued by that gifted but much misunderstood body, the Economic League, and it was shown how successfully they had blown sky-high the first “fallacy” they had dealt with. Here follows the second “Socialist” fallacy on their list for combustion :—

Fallacy No. 2.The interests of Capital and Labour are essentially antagonistic. Therefore, class warfare is necessary and inevitable.

Not bad for a translation by such busy people! If you would prefer the original, however, it reads as follows:—

  That society as at present constituted is based upon the ownership of the means of living (i.e., land, factories, railways, etc.) by the capitalist or master class, and the consequent enslavement of the working class by whose labour alone wealth is produced.
That in society, therefore, there is an antagonism of interests, manifesting itself as a class struggle, between those who possess but do not produce, and those who produce but do not possess.

Now you will hardly credit it, but these wild Socialists actually believe that this eccentric notion has historical justification to support it! Indeed, Engels, for example, in the preface to the “Communist Manifesto,” has the impudence to assert:—

That in every historical epoch, the prevailing mode of economic production and exchange, and the social organisation necessarily following from it, form the basis upon which is built up, and from which alone can be explained, the political and intellectual history of that epoch; that consequently the whole history of mankind (since the dissolution of primitive tribal society, holding land in common ownership) has been a history of class struggles, contests between exploiting and exploited, ruling and oppressed classes: that the history of these class struggles forms a series of evolution in which, nowadays, a stage has been reached where the exploited and oppressed class— proletariat—cannot attain its emancipation from the sway of the exploiting and ruling class—the bourgeoise—without, at the same time, and once and for all, emancipating society at large from all exploitation, oppression, class-distinctions and class struggles.

Class struggles, indeed ! But the leaflet has different stuff from this to offer:—

This is another of the principles in the Socialist Manifesto. It is based on apparent ignorance of the facts that operative labour itself is actually a form of capital, and that the so-called class war or conflict between Labour and Capital is really nothing but a suicidal sort of contest between two members of the same family. In evidence of the fact that labour is a form of capital, we have only to ask ourselves. What was man’s original capital before he had any tools or plant to work with? The answer undoubtedly is that it was his innate capacity to invent and create, or, in other words, his labour, mental and physical; and so we arrive at the fundamental economic truth that operative labour is capital in its truest and most original sense, and that the interests of the two are, therefore, naturally and necessarily identical.

Could clarity be more pellucid? After sorting this out I arrive at the following conclusions: (1) Labour is a form of Capital, therefore presumably Capital has other forms; (2) “Man’s original Capital” was labour, and therefore this and the other forms of Capital not here specified must have been derived from Labour; and (3) because Labour is a form of Capital, and Capital is a form of Labour, therefore the interests of Capital, of which Labour is a form, are “naturally and necessarily identical” with the interests of Labour, which is a form of Capital. Do you get that? (“Yes,” he lied glibly.)

One need not be an inmate of Banstead to believe that Capital and Labour are one as the law stands at present, but I admit a slight difficulty in comprehending how they can both be the same and yet, oh so different ! However, perhaps the next passage may enlighten us :—

  Mr. Dane tells us that “a workman’s character, skill and experience,” which constitute his labour, are “as truly capital” as the tools and plant and machinery with which he works; and that fact teaches us another fundamental truth, that it is Labour which employs Capital, and not the other way about, as so many seem to think. The worker in a factory employs not only his own capital, but that of the owner of the factory as well, without, be it noted, any of the latter’s financial risk. He is entirely dependent on both, and it is suicidal folly on his part to quarrel with his bread and butter, or, in other words, to wage war on what, after all, is his sole and only means of existence. It is perfectly true that one form of capital may refuse to employ the other, if, on the one hand, the financial risk is considered too great, or if, on the other hand, the remuneration is considered insufficient; but these differences of opinion are surely matters for amicable negotiation rather than for conflict. In any case, the fact remains that both forms of capital are absolutely dependent on each other.

For the first time, I now realise that “a workman’s character, skill and experience constitute his labour,” though obviously he has sometimes to take these attributes to bed with him ! (In this case perhaps the “labour” is done by proxy or correspondence.) One should always be careful, however, not to be vulgar, like Karl Marx, and include such qualities with physical and mental energy in what he calls labour-power. This is simply not done in the best economic circles. But I must agree that this unperformed labour of the worker is “as truly Capital as the tools and plant and machinery with which he works.” We must take the word of such recondite “economists” as the Economic League that machinery, plant and tools are Capital. Even before their installation in the factory, even when the factory is “closed down,” and most decidedly when they are thrown out of the factory on to a dust heap—they are still “Capital.” I can almost understand this, but I confess to a wee difficulty in being able to comprehend (1) just when the machine, etc., becomes Capital, and (2) exactly what thickness of cobwebs or rust on a disused or unworked machine is necessary to accumulate before the machine ceases to be Capital—is it twelve inches or only six? You see, these Socialists have no respect at all for economic truths, and they guffaw rudely when people say that machinery, plant and tools are in themselves Capital. That Karl Marx of theirs can be very trying on this subject:—

Capital consists of raw materials, instruments of labour, and all kinds of means of life which are used to produce new raw materials, new instruments, and new means of life. All these component parts of capital are created by labour, products of labour, stored-up labour. Stored-up labour which serves as a means of new production is capital.
So say the economists.
What is a negro-slave? A man of the black race. The one definition is worthy of the other.
A negro is a negro. He only becomes a slave under certain conditions. A cotton-spinning machine is a machine for spinning cotton. Only under certain conditions does it become capital. Torn from those conditions it is no more capital than gold itself is money, or sugar the price of sugar. (Wage-Labour and Capital.)

In other words, they say that these things (machinery, etc.) are only Capital during the time wage-labour is employed to operate them. But most diabolically of all, they claim that under Socialism even more and better machinery, plant and tools will be in use than at present, but they will be socially owned and will produce wealth for use only.

I was glad to find from this last-quoted passage that the Economic League make it clear that when they state that the interests of Capital and Labour are identical they mean the interests of the owners of Capital and the owners of wage-labour (i. e., workers), for this helps me to grasp their meaning when they state that “it is Labour which employs Capital, and not the other way about, as so many seem to think.” If our capitalist wage-worker readers will bear this in mind, they should have little difficulty in recognising the aftcoming episode as an everyday experience of this simple fact:—

   Scene: Dejected looking Capitalist diffidently approaching the sanctum of his prospective employer—an obese, complacent, prosperous looking Wage-worker. Holding a cloth cap in his hand and looking down furtively at a big toe protruding from an aged boot, he musters up enough courage to tap upon the massive oak portal.

Voice of Wage-Worker from within: Come in!

Capitalist: Got a job, guv’nor? I bin sent by the Capiterlist Buroo. ’Ere’s me perticlers, sir!

Wage-Worker: H’m ! What can you do, my man?

Capitalist: I can own factories, plant and machinery, get you to work for me, pay you good money but not much of it, and keep all you produce for myself.

Wage-Worker : Good. Can you do anything else?

Capitalist: Well, you can’t expect me to do anything else, guv’nor, now, can you? I ain’t got much time to spend in this country, you know. I shall have to do the job from Cannes or Madeira, and perhaps sometimes from “Monty.”

Wage-Worker: Right, you’re engaged. I’ll ring for my manager to start you at once, but see that I’m allowed to make plenty of profit for you or you and I will fall out. You get me?

Our sapient leafleteer then reminds us that Capital is Labour’s bread and butter (no, not “marge” !) and it is silly for the worker to quarrel with his portion thereof. Well, as Capital and Labour are one, this dictum appears to apply equally to the Capitalist. This horrid spectacle of two slices of bread and butter engaging in a fratricidal struggle may be highly diverting to untutored minds, but I regard it as reprehensible in the extreme. Further, we are told the Capitalist is not only the “sole” but the “only” means of existence for the worker. (When he has finished the sole, apparently he cornea on to the “only” !) Even the most perverse Socialists do not deny this fact. Indeed, Marx himself says something similar:—

To say that the interests of capital and the interests of labour are identical means merely this: capital and wage labour are two sides of one and the same relation.
The one conditions the other, just as the usurer and the borrower mutually condition each other.
So long as the wage-worker remains a wageworker, his lot is dependent upon capital. That is what the alleged identity of interests between worker and capitalist amounts to.
If capital grows, the mass of wage-labour grows, the number of wage-workers increases. In a word, the dominion of capital extends over a greater number of individuals. (Wage-Labour and Capital.)

Of course, the qualification is quite unnecessary !

Next we are told that the one form of Capital may refuse to employ the other. As, for example, when all the workers in an industry have simultaneously conferred upon them the freedom to enjoy the jollities of the kerbstone, whilst “the other form of Capital” is enduring the anguish of “financial risk” and sunstroke at Madeira. Of course, the worker does not incur “financial risk.” When he asks for more wages—the suggestion is absurd ! The million-and-a-half unemployed workers ought to feel more sympathy than they appear to express for the sorry plight of their capitalist brothers, brought on by “financial risk.” The terrible ravages of the malady of “financial risk” may be only partially gauged by the perusal of the under-stated facts :—

About one-half of the entire income of the United Kingdom is enjoyed by about 12 per cent, of its population.
More than one-third of the entire income of the United Kingdom is enjoyed by about 3 per cent, of its population. (From Chiozza-Money’s “The Nation’s Wealth,” pp. 110-111.)
Let us take one of the main features of existing society—its division into two classes; a propertied class and a propertyless class. This is obviously the result of the ownership of the wealth of society by some of the people, to the exclusion of the others, for this alone produces a class of possessors and a class of non-possessors.
With regard to the ownership of property, Mr. Zorn has shown (Daily News, November 29th, 1919) that 10 per cent. of the population owns 99 per cent. of the wealth, while the remaining 1 per cent, is divided among nine-tenths of the people. And Professor Clay tells us that—

it is probably safe to say that over two-thirds of the national capital is held by less than 2 per cent, of the people.—Times, 24th March, ! 1925.

So the two-class nature of the present social scheme is directly traceable to that form of private property which excludes one class from ownership. (From Socialism, p. 28.)

I trust the recital of these facts will enlighten the reader as to the identity of interests between the wage-slaves and their masters, and that he will point out the selfishness of the workers in allowing their capitalist brothers to suffer in silence these agonies of “financial risk.”

I regret my space ration forbids me to do justice to the admirable way in which the Economic League view Capital and Labour in all its aspects and in all historical epochs. The primitive tools of the communistic tribesman, the implements of the handicraftsman, the merchant’s capital, the mediaeval usurer’s money capital, the giant machines, factories, etc., of to-day, the great financial corporations, labour under all conditions (of the communistic savage, the chattel slave, the feudal serf, the handicraftsman and the wage-worker)—all these are Capital in the eyes of the Economic League. Their argument seems, therefore, to be: As mines, mills, workshops, etc., are Capital, and as Socialists mean to abolish Capital, therefore there cannot be mines, mills, workshops, etc., under Socialism. Which, 1 think, is quite good, don’t you, reader?

There are still three more explosions of “fallacies” in the leaflet, so, all being well, there should be a real “Brock’s benefit” for our next issue.