Prblems Facing the Labour Government. The Menace of Unemployment
The recently elected Labour Government is faced with the responsibility of clearing up the mess caused by war. This is an unenviable task for those who consider the only way it can be done is to restore capitalist “prosperity.”
The ruling class are apparently not seriously perturbed; they have been assured by their advisers that capitalist interests will be preserved. The Financial Times (July 28th) speaks to its readers as follows.
“The result of the election is not regarded tragically. … So long as the new Government does nothing to harm the national credit—and it is likely to be very circumspect in this respect—the holders of Government stock will have nothing to fear. This applies indeed to all well established holdings. It would be a mistake for their owners to allow themselves to be frightened into throwing them on the market, and fortunately there is no sign of anything of the kind happening. . . .
Apart from political and economic consequences of any move toward nationalization, the financial aspect would turn upon the eventual definition of the fair, but not excessive compensation of which Mr. Attlee has spoken.”
The emancipation of the working class is not anticipated by our masters: economic security even is now relegated to the limbo of forgotten things: “employment for all” has served its purpose, and is now being discarded as impracticable. Those who live by the exploitation of their fellows under Capitalism have but one object in view in regard to Labour and that is to keep theiv slaves in bondage. Professor Henry Clay recently delivered a lecture on War and Unemployment. He spoke as a Warden of Nuffeld College. He is an economist with practical experience inasmuch as he has been in an advisory capacity in close touch with the Bank of England during the recent expansive period. He was connected with certain key enterprises launched by the Bank while the war was on and his opinion is that the problem is how to survive in a world which threatens Britain? economic destruction.
The Statist (July 21st) discussing Professor Clay’s speech says.
“But the British economic and social problem cau be reduced to terms of the utmost simplicity with au appreciable increase of value. After enduring the storms and stresses and sacrifices of war for six years the British populace, economically untutored and still politically ignorant, has been led to suppose that by the magic of the Beveridge schemes or their pale twin the Government White Paper ou Employment Policy, there can be attained for all that mysterious something known as Social Security, and the maintenance of a high and stable level of employment. Some still believe that full employment can be assured. The task of the statesman is to fulfill it, to prevent a disillusioned and hurt; populace from overthrowing the social fabric.”
Professor Clay says : —
“If I am right, the unemployment problem with which the last war confronted the country had not been dealt with when the present war broke out, and the identical problem with which this war will confront the country will not be a transient condition which can be left to cure itself. Something more than the proposals of the White Paper in this matter—a continuation of controls to regulate prices and priorities and the erection of controls to direct the location of new enterprise— will be needed if the influence of war in aggravating unemployment is not to be important for a generation or two.”
The Statist goes on to say :
“Again reducing the complexity to a sublime simplicity, the thought behind the official and academic approaches to the employment problem is that if the total national expenditure—spending power exerted—is sufficient to employ the whole population at the current level of wages all will be well, and therefore when the natural and almost instinctive flow of private spending begins to weaken all that; the State has to do to save the situation is to inaugurate or stimulate a flow of public expenditure. This blithe thought Professor Clay combats. ‘Mere expansion of Government expenditure,’ he says, ‘can prevent unemployment only by inflation : the impact of the additional income created will force up prices where there is a shortage and maintain them where there is a redundancy.'”
The Statist comments again :
“In short the problem is not one of merely maintaining purchasing power at a ‘sufficiency.’ It is one primarily of redressing economic maladjustments caused or augmented by the war, or indeed by other abnormalities or developments in human life—redressing them in such a way that their fulfilments can be brought into a proper coincidence, and redundances distributed or absorbed or liquidated in some tolerable way.”
“‘The Government will be possessed of large stocks of goods with a commercial use. One industrialist of my acquaintance has argued that, since they were created for war purposes, these stocks should not survive the War, but be dumped into the Atlantic, otherwise by competing with current production for limited markets they will prevent industry from recovering its peace time balance. The remedy is too heroic for any conceivable Treasury, but it brings out a problem : more than a quarter of the machine tool makers in this country were forced into bankruptcy after the last war by the competition of war surplus supplies.”
“Markets disrupted, interrupted, diverted : production disrupted interrupted and diverted : labour diverted and rendered less fluid than it used to be : skill in making and marketing lost: transit diminished: financial technique warped or perverted—these are the causes of potential British unemployment, rather than the simple mathematical disequilibrium of the power to spend or the will to spend. Until these causes are cured the tendency of the nation may be, thinks Professor Clay, to slip unconsciously into a policy of perpetuating the war economy.”
It is a danger which he sees vividly.
“The Problems which will present themselves if war controls are lifted will offer so terrifying an aspect that a totalitarian direction of the whole economy of the country may have less terrors. I hope we shall rot drift into that solution.”
To «how how helpless the ruling class are at the present moment I have quoted extensively from the Statist. The readers of the STANDARD must bear in mind these quotations are from Capitalist sources and show how helpless is the outlook for capitalist and how hopeless a Labour Government is that thinks it can run the system better than our masters.
The Statist concludes :
“There then is the statesmen’s problem—not to be led by bureaucratic and donnish mind into assuming that mere manipulation with State spending can effect the benefits which the populace has been promised, nor to relieve the fears of a frightened community by offering the tyrannical protection of a totalitarian system, but to find a means of enabling enterprise to restore its markets, restore fluidity to labour, and adjust diverted production and war surpluses in such a way that new production suffers the minimum of delay in catering for peace demands in the minimum of obstruction in disposing of its products.”
“In dealing with so complex a problem as the restoration and increase of a high level of stable employment, there is much danger in generalisations, which are unfortunately what constitutes the electoral stock in trade of statesmen and politicians. If the bureaucratic fetish of a mathematical adjustment of spending powers is inadequate to a problem involving manifold human factors, so also is the hustings panacea of a 50 per cent. rise in exports. The British trading community—from producer through to finance negotiator and retailer does not live by exports alone essential though they are. Neither does exporting industry as a whole offer scope for so gigantic an increase.
Mr. O. M. Clark, Chairman of J. and P. Coates, at the recent annual meeting said quite frankly. ‘Prominent politicians and others at various times have stressed the importance of increased exports after the war and a figure of 50 per cent. increase has at times been mentioned. If this is included merely as a tragic figure, little need be said about it, but if anybody seriously believes that the volume of goods to be exported from this country would within a reasonable period be raised by 50 per cent., without the introduction of an entirely new technique of selling, I fear he is doomed to disappointment. In our own case, of J. and P. Coates, in spite of certain advantages which the Company enjoys, could succeed in increasing the export volume permanently by anything like 25 per cent. after the War I should consider it had accomplished a remarkable performance.'”
“So indeed would many other directors of large scale companies with efficient past selling records facing spoilt or invaded export markets. Britain it is clear to everyone outside a bureau or a sanctum of a confirmed Bloomsbury planner cannot survive the post-war struggle for trade, much less provide all the promised social betterments to her people merely by tinkering with the streams of private and public expenditure or by shouting for a 50 per cent. increase in exports. She has to discover much more drastic and realistic methods of stimulating trade and employment than those.”
The events now about to transpire will prove to the hilt the truth of the Socialist Party’s position.
What can the Labour Party or any Party do to improve matters when compelled to operate within the framework of Capitalism? The system is played out. It cannot go until the workers realise it is their job to abolish it. The great task is to make the workers realise this, and what they are called upon to do. In other words Socialists are wanted to establish Socialism.
LESTOR