Notes by the Way
It Puzzles us, too
The following is from Mr. A. J. Cummings’ column in the News Chronicle (10/5/49):
“Here is a new American view of the Socialist and Tory doctrines in Britain which should delight our Communists.
“Morgan Phillips, the Labour Party’s able secretary, was asked to write a 5,000 words piece on the Labour Government’s record for the 1949 edition of the American ‘Information Please’ Almanac ; and R. A. Butler was asked to write 5,000 words on the Tory Party’s policy.
“These two masterpieces were duly received by John Kieran, the Almanac editor.
” ‘Soon afterwards,’ Phillips tells me, ‘I was much amused to get a letter from Kieran saying he thought it would be difficult for Americans to distinguish between the Socialist and Tory policies ; so he asked us to do another 500 words replying to each other.’
“It will be instructive to discover how far the additional 1,000 words bring enlightenment to American readers.”
The New State Loan in Russia
The Russian Embassy in London announces in Soviet News (5/5/49) that the Russian government is raising a new loan amounting to 20,000 million roubles. In the same issue information is given about previous loans. It is stated that 50,000 million roubles were raised before the war, 76,000 million “during the years of the Great Patriotic war,” and 77,000 million since the war.
It is not possible from these figures to say what is the total of bonds outstanding at present, because much has been paid off, and also the value of many government bonds was cut by about three-quarters when the new currency was issued in 1947.
As, however, the interest or lottery prizes total four per cent, of the capital value, and as it is stated that the bondholders will receive as income from their bonds more than 2,500 million roubles in 1949 the total of bonds outstanding must be about 62,500 million roubles.
There is no official exchange rate for representing this in English currency, but if we take the exchange rate used by the Times (11/9/49) of about twenty-two roubles to the £1, it is equivalent to £2,840 millions.
An interesting piece of information given in the Soviet News a year ago (4/5/48) was that about one-third of the total investment of capital is covered by loans.
The number of bondholders is said to run into “tens of millions.” Bonds are issued in values ranging from 25 roubles (£1), up to 500 roubles (about £20). Investors can subscribe for any amount they wish.
On the new loan the whole of the interest is paid out in the form of lottery prizes so that two-thirds of the bondholders, those who fail to draw the lucky numbers, receive no interest but receive their capital back some time between 1954 and 1969 (unless another currency change is introduced before then). Those who draw the lucky numbers may receive prizes ranging up to 50,000 roubles on a 100-rouble bond.
The Privileged Few
Apart from the great inequality of incomes and the chance of winning big prizes in the bond-lotteries a small minority stand the chance of gaming large sums as “Stalin prizes” for distinguishing themselves in some way approved by the government Lysenko received a first prize for his work in biology and Latyshev “for research in atomic fission.” (Times, 11/4/49.) The first prize is 200,000 roubles and what this represents may be seen by comparing it with the average worker’s wages which Alexander Werth, former Moscow correspondent of the Manchester Guardian, gave as about 1.000 roubles a month in Moscow. (Manchester Guardian, 17/7/48.)
The following is from an article headed “Socialism in Practice: Property in the U.S.S.R.”, which appeared in the Soviet News (8/4/48.)
“Soviet writers, artists, scientists, composers and other professional people receive large incomes from their work, besides the high salaries many of them are paid in the State or other public institutions in which they are employed.
“It is no rare thing in the Soviet Union nowadays for an Academician and a Stakhanovite worker, a writer and a technician, a surgeon and an office worker, to have a fine country house, in addition to a comfortable home in town. Soviet citizens may draw considerable incomes from State Loan bonds, in the form of interest or in the form of winnings. There is no control or accounting whatever of the amount of property owned by individual citizens. And that the amount may be quite high is shown by the fact, for example, that during the war many industrial workers, farmers and professional people contributed tens of thousands of roubles each year to the country’s defence fund. One collective farmer, Ferapont Golovatz, purchased with his own money two aircraft, which were presented to the Soviet Army’s air forces.” (Soviet News, published by the Soviet Embassy in London, 8/4/48.)
In passing it is curious to note that though many of the “fellow-travellers” and “innocents abroad” who make the tour to Russia have commented on the acute housing shortage we have never seen one of them protest against the lucky few having two fine houses while the majority are living in overcrowded apartments.
The Disappointed Railwaymen
The railway workers whose application for a 12s. 6d, a week wage increase was rejected by the Arbitration Tribunal in March have been learning a few things they did not know about nationalisation and Labour government.
The first shock—though why it should have surprised anyone is a mystery—was experienced by Mr. J. B. Figgins, general secretary of the National Union of Railwaymen. He found to his astonishment that the controllers of the nationalised railways used some of the same arguments against the wage claim as were used by the Boards of the Railway companies before nationalisation. If he had looked at the Post Office he would have seen that the Post Office and Treasury officials always have used the same arguments against postal workers.
The second shock was of a similar kind. In the negotiations between the railway workers and the Railway Executive the case for the latter is now being presented by Mr. Walter P. Allen who, as the Daily Express points out, was until two years ago “one of the most forceful negotiators for the locomotive engineers and firemen. Now he is responsible for labour relations on the railroads.” (Daily Express, 7/5/49.)
Mr. Allen has soon slipped into the traditional phraseology of the employers, for he promised that the Railway Executive would give “serious consideration” to the men’s claim.
The N.U.R. recently asked its members what they think of nationalisation after one year’s experience of it. The replies were published in the Railway Review (11/2/49). The replies showed that 88.7 per cent. of them had supported nationalisation before it happened ; but when they were asked whether after a year they found their job more encouraging these were the replies: only 9.7 per cent. found it more encouraging, 45.5 per cent. found it about the same, and no less than 44.8 per cent. stated that they found it “more frustrating.”
Be Ruthless
There is at least one of the controllers of nationalised undertakings who does not mind saying plainly what is the guiding principle behind State management. He is Sir Miles Thomas, deputy chairman of the British Overseas Airways Corporation. Speaking at the conference of the British Institute of Management he said:
“When shorn of all ideological dogma, the actual business of managing a State enterprise must follow the same hard and ruthless rules as any other.” (Manchester Guardian, 9/5/49.)
Great men and their influence on history
To many people, including some historians, history is to be explained in terms of the ideas and actions of outstanding “great men.” Where the “great man” is working in harmony with the development of the productive forces of his age and with the rise to power of a new social class it may seem to the superficial observer that it is he who is setting these forces in motion, but in our own time we have seen a man, the late Mahatma Gandhi, whose enormous personal popularity was based on ideas not in harmony with the development of industrial capitalism in India. The result is well brought out in the following passage written by S. K. Ratcliffe in a review of two books on Gandhi (Observer, 1/5/49.)
“In personal power no man has ever equalled Gandhi. The independence of India could not have come without the upsurge of the multitude that was his doing. And now we have a shattering irony and contradiction. The first Prime Minister of the Republic, the Mahatma’s closest political colleague, is inviting foreign capital and driving ahead towards an India of great-scale industry and power development, to embody the terrific opposite of Gandhi’s idea and purpose. His sign was the spinning-wheel; Nehru’s is the giant machine.”
It is, of course, not true as Mr. Ratcliffe implies that without Gandhi the Indian capitalist-nationalist movement would not have come to power. What is true is that his encouragement of that movement played a part, though not an indispensable one, but where his teachings were in conflict with industrialisation—as most of them were—they were absolutely ineffective; masses of people admired him and pay lip service to his ideas but proceed to build up capitalist India without the least regard to Gandhi.
Among other developments the Indian Government is rapidly building up the armed forces without which no Power can survive in the capitalist world, yet Gandhi was for years the exponent of pacifist non-resistance. When a public ceremony took place on the anniversary of his death prominent in the throng were the troops of the Indian State, paying tribute to the admired pacifist with arms in their hands.
Insurance Companies to be Nationalised?
When the Labour Party announced their intention of nationalising the Insurance companies after the next election the Daily Express gave some interesting information on the two insurance giants, the Prudential and the Pearl.
“BUT the Prudential and the Pearl, the two leading insurance companies, have £74 million Ordinary shares in hundreds of companies in every industry. There is hardly a major British company in which the Prudential is not a shareholder.
“The Prudential has a large block of shares and a vital say in Rootes Securities, which control the Hillman-Humber car group. It has a 10 per cent. interest in Marks and Spencer. In 1941 it held 20,000 shares in the Daily Mirror. It is believed to have holdings in Odhams Press.
“It once staked £150,000 in the Arsenal Football Club—and paid £250,000 for the village of Cockington, near Torquay. Its property investments, worth £40 million, range from small houses to office blocks like Thos. Cook’s headquarters in Berkeley Street.
“It owns the one-branch British Mutual Bank at Ludgate Circus. It has had shares in Earl’s Court Exhibition Hall; in Car Mart, the motor firm ; in Peter Robinson, the Oxford Street store. It has had an interest in Selfridges, too.
“It is in Gestetner, the office-equipment makers—and in Holman Brothers, the mining-equipment makers.
“Before the war the Prudential put more than a million in films and some of it went to build Denham Studios for Sir Alexander Korda.
“By bunching together the investments of many insurance companies the Socialists will effectively control scores of companies. (Daily Express, 13/4/49.)
The Labour Party Planners
Labourites attacked private capitalism for being planless and chaotic and optimistically believed that when they took over capitalism they would show how it can be planned into order. They would not listen when Socialists said it cannot be done, but now they are learning by experience. The following account of one of their efforts is from a report by the Comptroller and Auditor General and is reproduced from the Daily Telegraph (10/5/49):
“In the summer of 1946, at the instance of the Ministry of Fuel, a scheme was launched to convert 1,200 locomotives to oil firing with the object of saving a million tons of coal a year. Expenditure in 1946-47 reached £268,650, and in 1947-48 £1,335,309.
“In September, 1947, when 93 locomotives had been or were being converted, the Ministry of Transport was warned that the 840,000 tons of oil needed annually might not be available. Work on locomotives was suspended, but storage depots were completed.
“The British Transport Commission which took over the railways on January 1, 1948, told the Ministry that the additional cost of operating the 93 converted locomotives was £279,000 a year; for the full programme the extra cost would be more than £34 million a year.
“Disagreeing with the Ministry, the Commission maintained that extra expenditure on the scheme was not justified. In May, 1948, it was abandoned. The 93 oil burners are being reconverted to coal at a cost of £200 each.
“Expenditure estimated initially at £11,000 and afterwards at £10,000 a year is being incurred by the Ministry on care and maintenance of the storage depots. The Ministry in November, 1948, estimated its total expenditure at nearly £3 million.”
H.