2020s >> 2021 >> no-1404-august-2021

Cooking the Books 2

Divvying up?

In an article in New Left Review 128 (March-April 2021), Kenta Tsuda imagines a computer that calculates the world’s wealth and then allocates an equal amount to every man, woman and child on Earth. Credit Suisse’s research institute estimated total global wealth in 2019 to have been $360 trillion. Sharing this out equally amongst the world’s population of 7.8 billion gives everybody $46,000 (or £33,000) worth of wealth.

He wasn’t advocating this himself. There are others who do advocate redistributing wealth so that it is more evenly divided than at present. Normally they don’t advocate that everybody should have the same amount but that the present highly unequal distribution of wealth and income should be drastically reduced.

Some – and some of them – think that this is what socialists want. But we don’t and never have. Friedrich Sorge, a close associate of Marx who was in regular correspondence with him, wrote in a pamphlet Socialism and the Worker that was first published in 1876:

‘Concerning the division of money, I must relate an anecdote invented to ridicule people who are represented to have such intentions. One day in 1848, as the story goes, Baron Rothschild took a walk on the Common of Frankfort-on-the-Main. Two labourers met him and accosted him thus: “Baron, you are a rich man; we want to divide with you.” Baron Rothschild, not the least puzzled, took out his purse good-humouredly and answered: “Certainly! We can do that business on the spot. The account is easily made. I own 40 millions of florins; there are 40 millions of Germans. Consequently each German has to receive one florin; here is your share;” and giving one florin to each of the labourers, who looked at their money quite confused, he walked off smiling’ (www.marxists.org/archive/sorge/1876/socialism-worker.htm).

What socialists want is not to divide up existing wealth but for it to become commonly owned by society as a whole. Dividing it up doesn’t make sense. Most wealth is not houses, cars and the other things people consume to live. It is the wealth that is used to produce more wealth (‘the means of production’) in the form of farms, factories, warehouses, shops, roads, railways, communications systems, and the like. These can only be operated cooperatively and are interlinked as a world-wide network of productive units (most items, even consumer goods, incorporate the work of people from different parts of the world).

In this sense the production and distribution of wealth is already ‘socialised’. What is not is the ownership of them and of what they are used to produce. That is in the hands of a tiny minority. Socialists want to bring ownership into line with the reality of production by making the means of production the common property of all society, so that they can be used for the benefit of all instead of as at present to make profits for the few.

Some of the wealth of the super-rich isn’t really wealth, for instance most of that attributed to the major owners of the tech giants – Bezos, Bill Gates, Mark Zuckerberg and the others. This is commonly measured by the stock market value of the shares they own in their company. But shares are not actually existing wealth; they are claims on future wealth (and so which does not yet exist), with their price based on the future income they are expected to bring. There is nothing physical that corresponds to them. Their value is different from that of the real things (buildings, machinery, IT systems) that companies own. When their price goes up no new wealth is created any more than wealth is destroyed when their price goes down. There is nothing there to be divided up. Or to be commonly owned.

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