1960s >> 1962 >> no-693-may-1962

DR. Beeching’s role with regard to the railways is clearly going to be a double one. First and foremost, he will be the Government’s “hatchet man,” with pretty wide powers to cut away the lines that are not making money and get rid of wasteful services. His second job will be that of official can-carrier for all the criticisms and complaints that will come as a result of all his pruning activities. His £24,000 a year salary will, of course, help him to bear the burden of such unpopularity.

The railways are going to look a lot different after he has finished with them. Many lines are going to go, many services will be cut down, and many heads are certain to roll. Dr. Beeching has already said that he thinks there are too many people on the payroll who have been only “playing at trains.” A lot of people who thought themselves outside the ranks of the working class are soon to realise that they depend very much on an employer for a living even though the contents of their pay packet are called a salary instead of a wage.

One group who will not be affected by the cutting-down operations will be the lucky owners of the government stock which was handed over to them when the railways were nationalised in 1947. This amounted to the tidy sum of £1000 million and was probably the easiest bit of lolly ever exchanged for such a dubious set of assets, with the possible exception of the equally large sum given for the worked-out coal mines when they were also nationalised. If they brought no benefits of consequence to the workers, the Labour Government certainly did well by the former owners of the railways and the coal mines.

These bondholders have been drawing their £ million a year regularly for the past 15 years and will continue to do so—without the need to spare a thought for the running of the business, nor the slightest worry over whether their dividend might be cut, nor even the remotest chance of their having to put back some of their profits into the firm should things get tight. They’re in clover.

All this by the grace and favour of the Labour Party who never seem to have given the matter a thought when they were weeping such crocodile tears a little while ago over the misfortunes of the workers having to pay higher fares for the privilege of going to work. Or perhaps they did think about it and conveniently kept their thoughts to themselves.

Travel without Fares?
The railways’ troubles have brought forth all kinds of suggested remedies. The most interesting has certainly been the one that all travel should be “free,” payment for the service as a whole coming out of central taxation.

The idea has not been taken up, of course, but it is quite possible that it will be adopted eventually on a smaller scale — perhaps by some municipal authorities. Certainly it was not dismissed out of hand. In fact, the most surprising aspect of the whole business was the way in which the suggestion was discussed quite seriously. There was none of the usual reactions that we Socialists expect when we talk about the possibilities of everything being produced for use. Nobody objected that the whole of the population would spend all their time riding round on trains and buses because they were free, which is the usual kind of reply we expect when we talk about Socialism.

No, the general feeling appeared to be only that it was too drastic a change to be adopted on a national basis. We suspect it is not the last we have heard about “free” transport under capitalism.

Pause becomes Restraint
The pay pause has officially ended, lithe Government has its way it will be followed by “pay restraint,” which should it be successful will mean that wages and salaries will not rise by more than about 2½ per cent. during the coming year.

In spite of all the ballyhoo, however, it seems that 1961 hardly saw a pay “pause”—wages in fact are reckoned to have risen overall by something like 7½ per cent. The Government, nevertheless, takes this as an improvement over 1960 when wages went up by something much higher, and as a boost to British capitalism over European competition particularly from Germany.
But the workers in many industries are already queuing up for increased wages and are hardly disposed to accept a maximum of 2½ per cent. It remains to be seen whether the Government will stick to its policy and fight the unions if it comes to it, or whether it will again give way and take refuge in the easier method of inflation. It is significant that the latest figures of the purchasing power of the pound show that whilst in 1960/61 it was worth 16s. 2d. compared with 1951/52, it had dropped to 15s. 8d. in 1961/62.

If you work this out it means a fall of about 3 per cent, in a year. Put this, for example, against the 2½ per cent rise in overall wages the Government expects next year and you see how the trick is worked. The apparent increase in wages is nullified by the fall in the value of the money in which they are paid.

The German Miracle
Economic developments in Germany have been giving the newspapers plenty of copy. Papers that have been regaling us for so long with talk about the so-called German “miracle” are now pointing out that after all the Germans are not “twelve feet tall.” One thing you can always rely on in the popular press is the way they can switch from one extreme of nonsense to the other—-and without the slightest hint of shame or embarrassment either.

In fact, all that has been happening is that, as in every country when things begin to get sticky, the German workers are being treated to a basin-full of the usual dire warnings about the disasters that will follow if they do not go easy on wage demands. It is something the British workers should know all about—after all, they have been getting it for the past seventeen years.

After having had it easy for some time German capitalism is now beginning to find the going harder. They are not alone in this—it is happening to capitalism the world over. Goods are not so easy to sell nor profits so easy to make. As always, the first reaction of the capitalist class is to tighten the screw on wages.

The German capitalists are trying to do just this and the speeches of their representatives such as Erhard are part of the process. Regardless of their differences when it comes to profit-making, the capitalist class of every country are the same when it comes to dealing with their workers. They use the same soft soap and go through the same old tricks.

Vacuum Cleaners go International
Recent moves by Hoovers reflect the changing face of capitalism. More and more are firms spreading outside national boundaries and becoming international not only in name but in their entire operations.

Once upon a time firms expanding into other countries treated each of their subsidiaries piecemeal. The British offshoot would confine itself to the British market and Britain’s traditional markets, the German offshoot would do the same, and so on.

All this is changing. Now international firms are thinking internationally. At Hoovers, for example, the main holding company is to be transferred to Switzerland and all activities directed centrally from there. Production and exports will be switched as required to the country or countries most suited to the circumstances at any particular time. It appears likely, for example, that the proposed new factory in France is aimed specifically at the Common Market and that the British side of the firm may be trimmed to fit this new situation.

In the same way, it is likely that the new small car being planned by Fords will be the concern not only of the United States, but of Britain and Germany as well. Production will be switched to any or all of these countries according to which shows the most prospects of profit. The policy will not be confined to the car as a whole, but will involve the components as well.
This development is showing itself in other industries and other firms and is all part of the “growing ever bigger” process of capitalism. It is likely to become more and more important in the future.
S. H.