The Swindle of Nationalisation

(Address at a meeting held by Swansea Branch)


The subject for to-night’s consideration has been selected by the Branch with some thought as one of the most important questions of the day, particularly in this area of the Coal and Steel industries.

For many years before the 1950 Labour Government, the idea was widely held that if the Government took over an industry, then progress would be made to some future ideal.

This was evidently the case with trade unionists, as resolutions passed at many Trade Union Congresses show. The notion was abroad that by removing the often objectionable or notorious exploiters and replacing them by Government officials or managers, some improvement in the workers’ position would result. This idea can only occur to those ignorant of the wages system; coal miners or steel smelters still work for wages, whether paid by the Government or private employers.

Wage-labour remains the basis of production. Wages are the price of labour power, which is the stuff a worker sells to an employer—his energy. This stuff has a value corresponding to the cost (in hours) of production. Who pays wages? Those who own wealth. Who receives wages? Those who must work to live. When are wages paid? ONLY when the sale of the work they buy results in profit. Therefore, nationalised industries, run on wages, have to show a profit, just like “private” capital.

The next point is this: if some receive wages, others must pay them. Who can pay wages? Those who own wealth. They can employ others. These employers are owners of wealth, so that wages must mean classes, rich and poor—workers and idlers, or, as the Principles of of the Socialist Party declare, society is divided into two classes, one class possessing—the other producing.

By being owners these people are also rulers, they conserve their ownership by consent and force, if necessary. That is, in a world based on private ownership and profit, the owners dominate the Government. They are the real power behind the State.

We are told that today we have a “Welfare State”; “welfare’’ or not, it remains a “State.” What is a State? No better definition has been given than Marx’s own: “ It is the executive committee of the capitalist class.” Please note that; the capitalist class as a whole.

The State is the machine of power which arose when conflicts between owners, or groups of owners, threatened the existence of organised society itself.

From the days of the ancient Greek City Republics and Imperial Rome, to Napoleonic France and Stalin’s Russia, this political machinery has been used to feather the nests of exploiters at the expense of the labourer. Sometimes it was a committee, sometimes a group, often a personal dictator, a Caesar, a Cromwell, a Bismarck, a Lenin, or a Hitler.

These “personal” States—whether of Persian kings of antiquity or rabble-rousers like Tito, are usually the most rabid and ruthless “Nationalisers” of all.

And the reason is obvious. The State exists to further the interests of the owners, not only by stopping one group of capitalists from reducing society to ashes, but also by providing services of value to capitalists’ businesses. Therefore, all those branches of industry which are of vital concern to most capitalists are the target of the Nationalises. Bismarck nationalised the German railways to get troops quickly to the French frontiers. Napoleon covered France with “Routes Nationals” to get armies on their way. Attlee nationalised coal mines to provide British capitalists with raw material. The Post Office, Docks, Electricity, Cables and Wireless occupy first places.

Some people claim that even if all this is true, it is still possible for the workers, fed up with private employers, to alter the position by Nationalisation in a democratic country. If the manager or director were replaced by trade union officials they think that these officials would then be subject to their control. This is nonsense.

The workers who wish to do this do not understand enough about the wages system. Workers cannot control wages—they can only abolish them.

Not understanding this, those workers vote for the Labour Party, which is committed to the maintenance of capitalism.

Nationalised concerns are expected to show a profit —they can only be capitalist. Whoever signs the order to close the pit is of little real consequence. What is important is the group the order is issued for—the capitalist; it is the same in Russian factories, or German railways, in Swiss electricity or the American postal service.

The nationalised industries must make profits for Bond holders instead of Shareholders.

Before the workers had undergone many years bitter experience of nationalisation, parties like the Labour Party (and also Lord Beaverbrook) made great play with some rubbish they called “public control of finance.” They included demands for the “Nationalisation” of the Bank of England in their election addresses and rashly promised to curb the wicked financiers. The actual nationalisation of the Bank of England has turned out to be as little momentous for the British worker as the question of which group of capitalists control the Suez Canal

Actually the Bank of England always has been controlled by Act of Parliament, and the investors who owned its capital. These investors had to satisfy the customers (the joint stock banks or Big Five). The Bank was always and still is the Government banker.

When today the Treasury raises (borrows) money by issuing Treasury bills, it must pay interest on the loans. When .an investor buys Government bonds he receives interest which can only come from profit made by exploiting the workers.

When the Labour Government “socialised” the Bank of England, they bought out (compensated) the owners whose stock paid 12 per cent., by declaring a guaranteed rate of 3 per cent. interest and paying £4 for a £1 share, so that the former owners still got their 12 per cent.

The payment of interest by nationalised concerns can only come from profit it must be capitalism.

The demand for nationalisation, therefore, is not a demand for Socialism at all; but strong Capitalism.

Under Socialism—a system of society based on common ownership, there will be NO wages, classes, money, armies or State, but freedom, equality,

What then, would the Socialist say when faced with the widespread growth of nationalised capitalism in all countries, spreading now to India and China.

This is the normal development of Capitalism, which concentrates in fewer hands. The biggest band is the State. Let is be so. We can no more stop it than stop uranium turning to lead. In Frederick Engels words:

“The modem State, no matter what its form, is essentially a capitalist machine, the State of the capitalists, the ideal personification of the total national capital. The more it proceeds to the taking over of the productive forces, the more does it actually become the national capitalist, the more citizens does it exploit. The workers remain wage-workers. The capitalist relation is not done away with. It is rather brought to a head. But brought to a head—it topples over.” (Socialism, Utopian and Scientific)

The solution is Socialism.

In the discussion which followed the question was raised as to whether, in spite of being still run by wage-labour, the South Wales coalfield had not improved working conditions under the Coal Board.

In answer to this, the chairman of the meeting cited the case of the pits at Gwaun-cae-Gurwen, where the whole population of the village had been threatened with destitution due to the Board’s decision to close the pit if output did not increase.

A special group of the strongest men had been picked and told that the decision depended on them. They went down, ignored safety precautions, went without meal times, slept in their pit clothes, and slogged away. They were then told “Not good enough” and given two more weeks by the Board. Finally the Board agreed to keep the pit open for a further trial period. It was questionable whether the South Wales miner had ever been reduced to such a position in the past, with miners’ officials egging them on and the local parson thanking God for the “miracle.”

The question of distribution without the payment of wages was raised, and the possibility of abuse of free consumption under Socialist.

A local resident from Loughor (Swansea) pointed out that fifty years ago there were no water mains there. When water pipes were laid, it was true that for a time people left taps running and took more water than they needed, but they “soon grew out of it.”

The meeting also dealt with some anarchist objections to political action.


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