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Perhaps these are not unimportant questions, which give a direction in advance to the reader who thinks for himself. In any case they are an indication of what will become a serious problem in later parts of this work, or rather will serve as a way to a philosophy which can really be carried through "without prejudice," a philosophy with the most radical grounding in its setting of problems, in its method, and in work which is systematically accomplished. It is also of interest that the Lockean scepticism in respect to the rational ideal of science, and its limitation of the scope of the new sciences (which are supposed to retain their validity), leads to a new sort of agnosticism. It is not that the possibility of science is completely denied, as in ancient scepticism, although again unknowable things-in-themselves are assumed. But our human science depends exclusively on our representations and concept-formations; by means of these we may, of course, make inferences extending to what is transcendent; but in principle we cannot obtain actual representations of the things-in-themselves, representations which adequately express the proper essence of these things. We have adequate representations and knowledge only of what is in our own soul. § 23. Berkeley. David Hume's psychology as fictionalistic theory of knowledge: the "bankruptcy" of philosophy and science. LOCKE'S NAÏVETÉS and inconsistencies lead to a rapid further development of his empiricism, which pushes toward a paradoxical idealism and finally ends in a consummated absurdity. The foundation continues to be sensationalism and what appears to be obvious, i.e., that the sole indubitable ground of all knowledge is self-experience and its realm of immanent data. Starting from here, Berkeley reduces the bodily things which appear in natural experience to the complexes of sense-data themselves through which they appear. No inference is thinkable, according to Berkeley, through which conclusions could be drawn from these sense-data about anything but other such data. It could only be inductive inference, i.e., inference growing out of the association of ideas. Matter existing in itself, a je ne sais quoi, according to Locke, is for Berkeley a philosophical invention. It is also significant that at the same time he dissolves the manner in which rational natural science builds concepts and transforms it into a sensationalistic critique of knowledge. In this direction, Hume goes on to the end. All categories of objectivity - the scientific ones through which an objective, extrapsychic world is thought in scientific life, and the prescientific ones through which it is thought in everyday life - are fictions. First come the mathematical concepts: number, magnitude, continuum, geometrical figure, etc. We would say that they are methodically necessary idealisations of what is given intuitively. For Hume, however, they are fictions; and the same is true, accordingly, of the whole of supposedly apodictic mathematics. The origin of these fictions can be explained perfectly well psychologically (i.e., in terms of immanent sensationalism), namely, through the immanent lawfulness of the associations and the relations between ideas. But even the categories of the prescientific world, of the straightforwardly intuited world - those of corporeity (i.e., the identity of persisting bodies supposedly found in immediate, experiencing intuition), as well as the supposedly experienced identity of the person - are nothing but fictions. We say, for example, "that" tree over there, and distinguish from it its changing manners of appearing. But immanently, psychically, there is nothing there but these "manners of appearing." These are complexes of data, and again and again other complexes of data - "bound together," regulated, to be sure, by association, which explains the illusion of experiencing something identical. The same is true of the person: an identical "I" is not a datum but a ceaselessly changing bundle of data. Identity is a psychological fiction. To the fictions of this sort also belongs causality, or necessary succession. Immanent experience exhibits only a post hoc. The propter hoc, the necessity of the succession, is a fictive misconstruction. Thus, in Hume's Treatise, the world in general, nature, the universe of identical bodies, the world of identical persons, and accordingly also objective science, which knows these in their objective truth, are transformed into fiction. To be consistent, we must say: reason, knowledge, including that of true values, of pure ideals of every sort, including the ethical - all this is fiction.

To be consistent, we must say: reason, knowledge, including that of true values, of pure ideals of every sort, including the ethical - all this is fiction. This is indeed, then, a bankruptcy of objective knowledge. Hume ends up, basically, in a solipsism. For how could inferences from data to other data ever reach beyond the immanent sphere? Of course, Hume did not ask the question, or at least did not say a word, about the status of the reason - Hume's - which established this theory as truth, which carried out these analyses of the soul and demonstrated these laws of association. How do rules of associative ordering "bind"? Even if we knew about them, would not that knowledge itself be another datum on the tablet? Like all scepticism, all irrationalism, the Humean sort cancels itself out. Astounding as Hume's genius is, it is the more regrettable that a correspondingly great philosophical ethos is not joined with it. This is evident in the fact that Hume takes care, throughout his whole presentation, blandly to disguise or interpret as harmless his absurd results, though he does paint a picture (in the final chapter of Volume I of the Treatise) of the immense embarrassment in which the consistent theoretical philosopher gets involved. Instead of taking up the struggle against absurdity, instead of unmasking those supposedly obvious views upon which this sensationalism, and psychologism in general, rests, in order to penetrate to a coherent self-understanding and a genuine theory of knowledge, he remains in the comfortable and very impressive role of academic scepticism. Through this attitude he has become the father of a still effective, unhealthy positivism which hedges before philosophical abysses, or covers them over on the surface, and comforts itself with the successes of the positive sciences and their psychologistic elucidation. § 24. The genuine philosophical motif hidden in the absurdity of Hume's scepticism: the shaking of objectivism. LET US STOP FOR A MOMENT. Why does Hume's Treatise (in comparison to which the Essay Concerning Human Understanding is badly watered down) represent such a great historical event? What happened there? The Cartesian radicalism of presuppositionlessness, with the goal of tracing genuine scientific knowledge back to the ultimate sources of validity and of grounding it absolutely upon them, required reflections directed toward the subject, required the regression to the knowing ego in his immanence. No matter how little one may have approved of Descartes's epistemological procedure, one could no longer escape the necessity of this requirement. But was it possible to improve upon Descartes's procedure? Was his goal, that of grounding absolutely the new philosophical rationalism, still attainable after the sceptical attacks? Speaking in favour of this from the start was the immense force of discoveries in mathematics and natural science that were proceeding at breakneck speed. And so all who themselves took part in these sciences through research or study were already certain that its truth, its method, bore the stamp of finality and exemplariness. And now empiricist scepticism brings to light what was already present in the Cartesian fundamental investigation but was not worked out, namely, that all knowledge of the world, the prescientific as well as the scientific, is an enormous enigma. It was easy to follow Descartes, when he went back to the apodictic ego, in interpreting the latter as soul, in taking the primal self-evidence to be the self-evidence of "inner perception." And what was more plausible than the way in which Locke illustrated the reality of the detached soul and the history running its course within it, its internal genesis, by means of the "white paper" and thus naturalised this reality? But now, could the "idealism" of Berkeley and Hume, and finally scepticism with all its absurdity, be avoided? What a paradox! Nothing could cripple the peculiar force of the rapidly growing and, in their own accomplishments, unassailable exact sciences or the belief in their truth. And yet, as soon as one took into account that they are the accomplishments of the consciousness of knowing subjects, their self-evidence and clarity were transformed into incomprehensible absurdity. No offence was taken if, in Descartes, immanent sensibility engendered pictures of the world; but in Berkeley this sensibility engendered the world of bodies itself; and in Hume the entire soul, with its "impressions" and "ideas," the forces belonging to it, conceived of by analogy to physical forces, its laws of association (as parallels to the law of gravity!), engendered the whole world, the world itself, not merely something like a picture - though, to be sure, this product was merely a fiction, a representation put together inwardly which was actually quite vague. And this is true of the world of the rational sciences as well as that of experientia vaga. Was there not, here, in spite of the absurdity which may have been due to particular aspects of the presuppositions, a hidden and unavoidable truth to be felt? Was this not the revelation of a completely new way of assessing the objectivity of the world and its whole ontic meaning and, correlatively, that of the objective sciences, a way which did not attack their own validity but did attack their philosophical or metaphysical claim, that of absolute truth?

Was this not the revelation of a completely new way of assessing the objectivity of the world and its whole ontic meaning and, correlatively, that of the objective sciences, a way which did not attack their own validity but did attack their philosophical or metaphysical claim, that of absolute truth? Now at last it was possible and necessary to become aware of the fact - which had remained completely unconsidered in these sciences - that the life of consciousness is a life of accomplishment: the accomplishment, right or wrong, of ontic meaning, even sensibly intuited meaning, and all the more of scientific meaning. Descartes had not pondered the fact that, just as the sensible world, that of everyday life, is the cogitatum of sensing cogitationes, so the scientific world is the cogitatum of scientific cogitationes; and he had not noticed the circle in which he was involved when he presupposed, in his proof of the existence of God, the possibility of inferences transcending the ego, when this possibility, after all, was supposed to be established only through this proof. The thought was quite remote from him that the whole world could itself be a cogitatum arising out of the universal synthesis of the variously flowing cogitationes and that, on a higher level, the rational accomplishment of the scientific cogitationes, built upon the former ones, could be constitutive of the scientific world. But was this thought not suggested, now, by Berkeley and Hume - under the presupposition that the absurdity of their empiricism lay only in a belief that was supposedly obvious, through which immanent reason had been driven out in advance? Through Berkeley's and Hume's revival and radicalisation of the Cartesian fundamental problem, "dogmatic" objectivism was, from the point of view of our critical presentation, shaken to the foundations. This is true not only of the mathematising objectivism, so inspiring to people of the time, which actually ascribed to the world itself a mathematical-rational in-itself (which we copy, so to speak, better and better in our more or less perfect theories); it was also true of the general objectivism which had been dominant for millennia. § 25. The "transcendental" motif in rationalism: Kant's conception of a transcendental philosophy. AS IS KNOWN, Hume has a particular place in history also because of the turn he brought about in the development of Kant's thinking. Kant himself says, in the much-quoted words, that Hume roused him from his dogmatic slumbers and gave his investigations in the field of speculative philosophy a different direction. Was it, then, the historical mission of Kant to experience the shaking of objectivism, of which I just spoke, and to undertake in his transcendental philosophy the solution of the task before which Hume drew back? The answer must be negative. It is a new sort of transcendental subjectivism which begins with Kant and changes into new forms in the systems of German idealism. Kant does not belong to the development which expands in a continuous line from Descartes through Locke, and he is not the successor of Hume. His interpretation of the Humean scepticism and the way in which he reacts against it are determined by his own provenance in the Wolffian school. The "revolution of the way of thinking" motivated by Hume's impulse is not directed against empiricism but against post-Cartesian rationalism's way of thinking, whose great consummator was Leibniz and which was given its systematic textbook-like presentation, its most effective and by far most convincing form, by Christian Wolff. First of all, what is the meaning of the "dogmatism," taken quite generally, that Kant uproots? Although the Meditations continued to have their effect on post-Cartesian philosophy, the passionate radicalism which drove them was not passed on to Descartes's successors. They were quite prepared to accept what Descartes only wished to establish, and found so hard to establish, by inquiring back into the ultimate source of all knowledge: namely, the absolute metaphysical validity of the objective sciences, or, taking these together, of philosophy as the one objective universal science; or, what comes to the same thing, the right of the knowing ego to let its rational constructs, in virtue of the self-evidences occurring in its mens, count as nature with a meaning transcending this ego. The new conception of the world of bodies, self-enclosed as nature, and the natural sciences related to them, the correlative conception of the self-enclosed souls and the task, related to them, of a new psychology with a rational method according to the mathematical model - all this had established itself. In every direction rational philosophy was under construction; of primary interest were discoveries, theories, the rigour of their inferences, and correspondingly the general problem of method and its perfection. Thus knowledge was very much discussed, and from a scientifically general point of view. This reflection on knowledge, however, was not transcendental reflection but rather a reflection on the praxis of knowledge and was thus similar to the reflection carried out by one who works in any other practical sphere of interest, the kind which is expressed in the general propositions of a technology. It is a matter of what we are accustomed to call logic, though in a traditional, very narrow, and limited sense. Thus we can say quite correctly (broadening the meaning): it is a matter of a logic as a theory of norms and a technology with the fullest universality, to the end of attaining a universal philosophy. The thematic direction was thus twofold: on the one hand, toward a systematic universe of "logical laws," the theoretical totality of the truths destined to function as norms for all judgments which shall be capable of being objectively true - and to this belongs, in addition to the old formal logic, also arithmetic, all of pure analytic mathematics, i.e., the mathesis universalis of Leibniz, and in general everything that is purely a priori. On the other hand, the thematic direction was toward general considerations about those who make judgments as those striving for objective truth: how they are to make normative use of those laws so that the self-evidence through which a judgment is certified as objectively true can appear, and similarly about the ways and temptations of failure, etc. Now clearly, in all the laws which are in the broader sense "logical," beginning with the principle of non-contradiction, metaphysical truth was contained eo ipso.

The systematically worked-out theory of these laws had, of itself, the meaning of a general ontology. What happened here scientifically was the work of pure reason operating exclusively with concepts innate in the knowing soul. That these concepts, that logical laws, that pure rational lawfulness in general contained metaphysical-objective truth was "obvious." Occasionally appeal was made to God as a guarantee, in remembrance of Descartes, with little concern for the fact that it was rational metaphysics which first had to establish God's existence. Over against the faculty of pure a priori thinking, that of pure reason, stood that of sensibility, the faculty of outer and inner experience. The subject, affected in outer experience from "outside," thereby becomes certain of affecting objects, but in order to know them in their truth he needs pure reason, i.e., the system of norms in which reason displays itself, as the 'logic" for all true knowledge of the objective world. Such is the typical rationalist conception. As for Kant, who had been influenced by empiricist psychology: Hume had made him sensitive to the fact that between the pure truths of reason and metaphysical objectivity there remained a gulf of incomprehensibility, namely, as to how precisely these truths of reason could really guarantee the knowledge of things. Even the model rationality of the mathematical natural sciences was transformed into an enigma. That it owed its rationality, which was in fact quite indubitable - that is, its method - to the normative a priori of pure logico-mathematical reason, and that the latter, in its disciplines, exhibited an unassailable pure rationality, remained unquestioned. Natural science is, to be sure, not purely rational insofar as it has need of outer experience, sensibility; but everything in it that is rational it owes to pure reason and its setting of norms; only through them can there be rationalised experience. As for sensibility, on the other hand, it had generally been assumed that it gives rise to the merely sensible data, precisely as a result of affection from the outside. And yet one acted as if the experiential world of the prescientific man - the world not yet logicised by mathematics - was the world pre-given by mere sensibility. Hume had shown that we naively read causality into this world and think that we grasp necessary succession in intuition. The same is true of everything that makes the body of the everyday surrounding world into an identical thing with identical properties, relations, etc. ( and Hume had in fact worked this out in detail in the Treatise, which was unknown to Kant). Data and complexes of data come and go, but the thing, presumed to be simply experienced sensibly, is not something sensible which persists through this alteration. The sensationalist thus declares it to be a fiction. He is substituting, we shall say, mere sense-data for perception, which after all places things (everyday things) before our eyes. In other words, he overlooks the fact that mere sensibility, related to mere data of sense, cannot account for objects of experience. Thus he overlooks the fact that these objects of experience point to a hidden mental accomplishment and to the problem of what kind of an accomplishment this can be. From the very start, after all, it must be a kind which enables the objects of prescientific experience, through logic, mathematics, mathematical natural science, to be knowable with objective validity, i.e., with a necessity which can be accepted by and is binding for everyone. But Kant says to himself: undoubtedly things appear, but only because the sense-data, already brought together in certain ways, in concealment, through a priori forms, are made logical in the course of their alteration - without any appeal to reason as manifested in logic and mathematics, without its being brought into normative function. Now is this quasi-logical function something that is psychologically accidental? If we think of it as absent, can a mathematics, a logic of nature, ever have the possibility of knowing objects through mere sense-data? These are, if I am not mistaken, the inwardly guiding thoughts of Kant. Kant now undertakes, in fact, to show, through a regressive procedure, that if common experience is really to be experience of objects of nature, objects which can really be knowable with objective truth, i.e., scientifically, in respect to their being and non-being, their being-such and being-otherwise, then the intuitively appearing world must already be a construct of the faculties of "pure intuition" and "pure reason," the same faculties that express themselves in explicit thinking in mathematics and logic. In other words, reason has a twofold way of functioning and showing itself. One way is its systematic self-exposition, self-revelation in free and pure mathematising, in the practice of the pure mathematical sciences. Here it presupposes the forming character of "pure intuition," which belongs to sensibility itself. The objective result of both faculties is pure mathematics as theory. The other way is that of reason constantly functioning in concealment, reason ceaselessly rationalising sense-data and always having them as already rationalised. Its objective result is the sensibly intuited world of objects - the empirical presupposition of all natural-scientific thinking, i.e., the thinking which, through manifest mathematical reason, consciously gives norms to the experience of the surrounding world. Like the intuited world of bodies, the whole world of natural science ( and with it the dualistic world which can be known scientifically ) is a subjective construct of our intellect, only the material of the sense-data arises from a transcendent affection by "things in themselves." The latter are in principle inaccessible to objective scientific knowledge.

Like the intuited world of bodies, the whole world of natural science ( and with it the dualistic world which can be known scientifically ) is a subjective construct of our intellect, only the material of the sense-data arises from a transcendent affection by "things in themselves." The latter are in principle inaccessible to objective scientific knowledge. For according to this theory, man's science, as an accomplishment bound by the interplay of the subjective faculties "sensibility" and "reason" (or, as Kant says here, "understanding"), cannot explain the origin, the "cause," of the factual manifolds of sense-data. The ultimate presuppositions of the possibility and actuality of objective knowledge cannot be objectively knowable. Whereas natural science had pretended to be a branch of philosophy, the ultimate science of what is, and had believed itself capable of knowing, through its rationality, what is in itself, beyond the subjectivity of the factualities of knowledge, for Kant, now, objective science, as an accomplishment remaining within subjectivity, is separated off from his philosophical theory. The latter, as a theory of the accomplishments necessarily carried out within subjectivity, and thus as a theory of the possibility and scope of objective knowledge, reveals the naivete of the supposed rational philosophy of nature-in-itself. We know how this critique is for Kant nevertheless the beginning of a philosophy in the old sense, for the universe of being, thus extending even to the rationally unknowable in-itself - how, under the titles "critique of practical reason" and "critique of judgment," he not only limits philosophical claims but also believes he is capable of opening ways toward the "scientifically" unknowable in-itself. Here we shall not go into this. What interests us now is - speaking in formal generality - that Kant, reacting against the data-positivism of Hume ( as he understands it) outlines a great, systematically constructed, and in a new way still scientific philosophy in which the Cartesian turn to conscious subjectivity works itself out in the form of a transcendental subjectivism. Irrespective of the truth of the Kantian philosophy, about which we need not pass judgment here, we must not pass over the fact that Hume, as he is understood by Kant, is not the real Hume. Kant speaks of the "Humean problem." What is the actual problem, the one which drives Hume himself? We find it when we transform Hume's sceptical theory, his total claim, back into his problem, extending it to those consequences which do not quite find their complete expression in the theory - although it is difficult to suppose that a genius with a spirit like Hume's did not see these consequences, which are not expressly drawn and not theoretically treated. If we proceed in this way, we find nothing less than this universal problem: How is the naive obviousness of the certainty of the world, the certainty in which we live - and, what is more, the certainty of the everyday world as well as that of the sophisticated theoretical constructions built upon this everyday world - to be made comprehensible? What is, in respect to sense and validity, the "objective world," objectively true being, and also the objective truth of science, once we have seen universally with Hume (and in respect to nature even with Berkeley) that "world" is a validity which has sprung up within subjectivity, indeed - speaking from my point of view, who am now philosophising - one which has sprung up within my subjectivity, with all the content it ever counts as having for me? The naivete of speaking about "objectivity" without ever considering subjectivity as experiencing, knowing, and actually concretely accomplishing, the naivete of the scientist of nature or of the world in general, who is blind to the fact that all the truths he attains as objective truths and the objective world itself as the substratum of his formulae (the everyday world of experience as well as the higher-level conceptual world of knowledge) are his own life-construct developed within himself - this naivete is naturally no longer possible as soon as life becomes the point of focus. And must this liberation not come to anyone who seriously immerses himself in the Treatise and, after unmasking Hume's naturalistic presuppositions, becomes conscious of the power of his motivation? But how is this most radical subjectivism, which subjectivises the world itself, comprehensible? The world-enigma in the deepest and most ultimate sense, the enigma of a world whose being is being through subjective accomplishment, and this with the self-evidence that another world cannot be at all conceivable - that, and nothing else, is Hume's problem. Kant, however, for whom, as can easily be seen, so many presuppositions are "obviously" valid, presuppositions which in the Humean sense are included within this world-enigma, never penetrated to the enigma itself. For his set of problems stands on the ground of the rationalism extending from Descartes through Leibniz to Wolff. In this way, through the problem of rational natural science which primarily guides and determines Kant's thinking, we seek to make understandable Kant's position, so difficult to interpret, in relation to his historical setting. What particularly interests us now - speaking first in formal generality - is the fact that in reaction to the Humean data-positivism, which in his fictionalism gives up philosophy as a science, a great and systematically constructed scientific philosophy appears for the first time since Descartes - a philosophy which must be called transcendental subjectivism. § 26. Preliminary discussion of the concept of the "transcendental" which guides us here. I SHOULD LIKE TO NOTE the following right away: the expression "transcendental philosophy" has been much used since Kant, even as a general title for universal philosophies whose concepts are oriented toward those of the Kantian type. I myself use the word "transcendental" in the broadest sense for the original motif, discussed in detail above, which through Descartes confers meaning upon all modern philosophies, the motif which, in all of them, seeks to come to itself, so to speak - seeks to attain the genuine and pure form of its task and its systematic development. It is the motif of inquiring back into the ultimate source of all the formations of knowledge, the motif of the knower's reflecting upon himself and his knowing life in which all the scientific structures that are valid for him occur purposefully, are stored up as acquisitions, and have become and continue to become freely available.

Working itself out radically, it is the motif of a universal philosophy which is grounded purely in this source and thus ultimately grounded. This source bears the title I-myself, with all of my actual and possible knowing life and, ultimately, my concrete life in general. The whole transcendental set of problems circles around the relation of this, my "I" - the "ego" - to what it is at first taken for granted to be - my soul - and, again, around the relation of this ego and my conscious life to the world of which I am conscious and whose true being I know through my own cognitive structures. Of course this most general concept of the "transcendental" cannot be supported by documents; it is not to be gained through the internal exposition and comparison of the individual systems. Rather, it is a concept acquired by pondering the coherent history of the entire philosophical modern period: the concept of its task which is demonstrable only in this way, lying within it as the driving force of its development, striving forward from vague dynamis towards its energeia. This is only a preliminary indication, which has already been prepared to a certain extent by our historical analysis up to this point; our subsequent presentations are to establish the justification for our kind of "teleological" approach to history and its methodical function for the definitive construction of a transcendental philosophy which satisfies its most proper meaning. This preliminary indication of a radical transcendental subjectivism will naturally seem strange and arouse scepticism. I welcome this, if this scepticism bespeaks, not the prior resolve of rejection, but rather a free withholding of any judgment. § 27. The philosophy of Kant and his followers seen from the perspective of our guiding concept of the "transcendental." The task of taking a critical position. RETURNING AGAIN TO KANT: his system can certainly be characterised, in the general sense defined, as one of "transcendental philosophy," although it is far from accomplishing a truly radical grounding of philosophy, the totality of all sciences. Kant never permitted himself to enter the vast depths of the Cartesian fundamental investigation, and his own set of problems never caused him to seek in these depths for ultimate groundings and decisions. Should I, in the following presentations, succeed - as I hope - in awakening the insight that a transcendental philosophy is the more genuine, and better fulfils its vocation as philosophy, the more radical it is and, finally, that it comes to its actual and true existence, to its actual and true beginning, only when the philosopher has penetrated to a clear understanding of himself as the subjectivity functioning as primal source, we should still have to recognise, on the other hand, that Kant's philosophy is on the way to this, that it is in accord with the formal, general sense of a transcendental philosophy in our definition. It is a philosophy which, in opposition to prescientific and scientific objectivism, goes back to knowing subjectivity as the primal locus of all objective formations of sense and ontic validities, undertakes to understand the existing world as a structure of sense and validity, and in this way seeks to set in motion an essentially new type of scientific attitude and a new type of philosophy. In fact, if we do not count the negativistic, sceptical philosophy of a Hume, the Kantian system is the first attempt, and one carried out with impressive scientific seriousness, at a truly universal transcendental philosophy meant to be a rigorous science in a sense of scientific rigour which has only now been discovered and which is the only genuine sense. Something similar holds, we can say in advance, for the great continuations and revisions of Kantian transcendentalism in the great systems of German Idealism. They all share the basic conviction that the objective sciences (no matter how much they, and particularly the exact sciences, may consider themselves, in virtue of their obvious theoretical and practical accomplishments, to be in possession of the only true method and to be treasure houses of ultimate truths) are not seriously sciences at all, not cognitions ultimately grounded, i.e., not ultimately, theoretically responsible for themselves - and that they are not, then, cognitions of what exists in ultimate truth. This can be accomplished according to German Idealism only by a transcendental-subjective method and, carried through as a system, transcendental philosophy. As was already the case with Kant, the opinion is not that the self-evidence of the positive-scientific method is an illusion and its accomplishment an illusory accomplishment but rather that this self-evidence is itself a problem; that the objective-scientific method rests upon a never questioned, deeply concealed subjective ground whose philosophical elucidation will for the first time reveal the true meaning of the accomplishments of positive science and, correlatively, the true ontic meaning of the objective world - precisely as a transcendental-subjective meaning. Now in order to be able to understand the position of Kant and of the systems of transcendental idealism proceeding from him, within modern philosophy's teleological unity of meaning, and thus to make progress in our own self-understanding, it is necessary to critically get closer to the style of Kant's scientific attitude and to clarify the lack of radicalism we are attacking in his philosophising. It is with good reason that we pause over Kant, a significant turning point in modern history. The critique to be directed against him will reflect back and elucidate all earlier philosophical history, namely, in respect to the general meaning of scientific discipline which all earlier philosophies strove to realize - as the only meaning which lay and could possibly lie within their spiritual horizon. Precisely in this way a more profound concept - the most important of all - of "objectivism" will come to the fore (more important than the one we were able to define earlier), and with it the genuinely radical meaning of the opposition between objectivism and transcendentalism. Yet, over and above this, the more concrete critical analyses of the conceptual structures of the Kantian turn, and the contrast between it and the Cartesian turn, will set in motion our own concurrent thinking in such a way as to place us, gradually and of its own accord, before the final turn and the final decisions. We ourselves shall be drawn into an inner transformation through which we shall come face to face with, to direct experience of, the long-felt but constantly concealed dimension of the "transcendental." The ground of experience, opened up in its infinity, will then become the fertile soil of a methodical working philosophy, with the self-evidence, furthermore, that all conceivable philosophical and scientific problems of the past are to be posed and decided by starting from this ground. Further Reading: Biography | Vygotsky | Existentialism | from Part III | Locke | Dilthey | Brentano | Hilbert | Heidegger | Schlick | Carnap Philosophy Archive @ marxists.org

MIA > Archive > Fritz Heckert Fritz Heckert The Election of Delegates to the German Metal Workers’ Conference (30 August 1923) From International Press Correspondence, Vol. 3 No. 58 [36], 30 August 1923, pp. 630–631. Transcribed & marked up by Einde O’Callaghan for the Marxists’ Internet Archive. Public Domain: Marxists Internet Archive (2022). You may freely copy, distribute, display and perform this work; as well as make derivative and commercial works. Please credit “Marxists Internet Archive” as your source. Up to the time of writing, the following results have been published of. the elections of the Metal Workers’ Union which took place on July 22 and 23, 239 delegates have been elected so far. Of these 116 belong to the opposition and 123 to the reformists. As the Union Conference will consist of a total of 400 delegates, this result is still only partial. But even this partial result already shows two things. Firstly, that the workers are beginning to take an ever growing interest in the conferences of their organizations. Never before has there been such extensive participation in the elections, either in the history of the metal workers’ organization or in that of the other trade union organizations of Germany. Almost everywhere there has been a 50% participation in the elections, and in many cases, even more than 50% of the members took part. At former elections to the Metal Workers’ Conference and to other trade union congresses only very small numbers of members could be induced to approach the ballot box. It was no rarity for only 5 to 10 per cent of the members to take part in the elections. At the election to the Trade Union Congress in the year 1919, a considerable number of the delegates were elected by the votes of onlv 2% and less of the members. The enormous participation of this year is due to the tremendous work of enlightenment which the communist fractious have performed of recent years. The German worker has thus been given a greater interest in the life of his organization, and even the Amsterdamers have found it necessary to occupy themselves somewhat energetically with the mobilization of the trade union members, in order to maintain their position. This rousing of the masses of members is regarded with extreme disfavor by the reformist trade union leaders. The workers now taking part in the active life of the meetings, and casting their votes against the reformist policy, are designated by the Amsterdamers as cranks, grumblers, fools, chatterboxes, etc. The reformists do not observe that they are lowering the whole trade union movement in the eves of the public by such railing against their members. And there is no doubt that the reformists would be delighted to witness this mass participation of the trade union members in the meetings, etc., if these masses would give unanimous assent to reformist methods. But in this respect the reformists have become unassuming. The fewer the members taking part in trade union activities, the better they are pleased. Indeed, a leading German trade union organ informed its readers, in the spring of this year, that the extremely poor attendance at the trade union meetings convened by the reform st officialdom was “no sign of mistrust of reformism on the part of the members, but a manifestation of confidence. The absent members show by their absence that they possess full confidence in the reformist leaders.” Secondly, the results of the elections to the Metal Workers’ Union Conference show an enormous increase in the opposition votes, cast for the communist lists. Although the reformists have not everywhere met with such annihilating defeat as in Berlin (here the opposition list received 54,000 votes, while the reformists, though controlling the whole union apparatus, only managed to obtain 22,000) and in Westphalia, the advance made by the opposition is none the less so mighty that every reformist must give it his serious consideration. Even though the number of opposition mandates will probably fall short of half the total of 400 mandates composing the Union Conference, it is even now almost certain that the majority of all the votes cast will fall to the opposition. In any case this is very largely true of the results already reported. How can we explain this? The ruling union officialdom has contrived to introduce a geometry of electorates and such methods of arranging the candidates, that the bosses of the union gain the majorities, even when the overwhelming majority of their members’ votes is registered against them. The candidates are generally nominated at delegate meetings; these delegates have the right to set up two lists, a majority and a minority list. The minority list must unite at least 10% of the votes of the delegates present at the meeting. On the face of it, this seems an extremely democratic arrangement, but as soon as we observe the constitution of the delegate meetings, we see that it is a most ingenious artifice for killing off the opposition from the very beginning. Let us take an example in the administrative headquarters at Dortmund, in Westphalia. The delegate meeting was elected in the spring of 1923 by a number of district meetings, as a matter of fact after a list election. (The Executive of the German Metal Workers’ Union has rejected proportional representation on principle.) At this election it turned out that the communists united in their lists 40% of the votes cast everywhere, but nowhere 50%. The whole of the mandates to the delegate meeting therefore fell to the social democrats.

The whole of the mandates to the delegate meeting therefore fell to the social democrats. Thus when the candidates were being nominated at the delegate meeting, no communist list could be submitted. The result was that the four delegates to be elected for Dortmund were nominated and elected by the United Social Democratic Party of Germany only, while a communist list, had one existed, would have received the overwhelming majority of votes, as was the case in the other Rhenish-Westphalian towns. Another example of electorate geometry. The Union constitution enacts that there shall be one delegate to every 4,000 members. Several administrative head quarters can be amalgamated to form one electoral district. In order to ensure a favorable result for the reformists, the administrations of Altenburg with 3,223 members, Jena with 3,225, and Schmalkaden with 3,533, were combined in Thuringia into one electoral district entitled to 3 delegates. The reformists speculated on the fact that Altenburg is a stronghold oi reformism, and was likely to yield such a surplus of rrformist votes that the victory over Jena and Schmalkaden would be assured, whereas, had each administration elected its own delegate, Jena and Schmalkaden would have fallen to the opposition And a third example will show how still other means may be employed to manufacture favorable results for reformism. In Pforzheim 6 delegates have to be elected. The reformist local administration called the meeting at which the candidates were to be nominated, but not till the day before, and without stating the business of the meeting. (This is against the constitution, but the constitution is only valid for the reformists when it can be used against the communists.) The reformists set the whole of their official machinery to work before this meeting, settled the candidates, and took the members completely by surprise by suddenly placing the nomination of candidates to the Union Conference on the agenda. This manoeuvre enabled them to prevent an opposition list from being submitted. But however cunning the artifices with which reformism strives to save its position, in the German Metal Workers’ Union as everywhere else, the election results show that these methods will not work for ever, and that these artifices, this ignoring of all democracy in the organization, will end in such tremendous defeats as that of Berlin. The reformists feel that their position is threatened, and therefore they are doing their utmost to hide their defeat, or to cover it by savage agitation against the opposition. They declare quite openly that they would not submit to an opposition majority, and are adopting means for stemming the advance of the opposition. They refuse to grasp the fact that the results of the elections are a condemnation of their polity, and continue their efforts to suppress the opinions of others – even at the risk of destroying the organization – by setting up a ruthless bureaucratic dictatorship. To those who have eyes to see, the results, of the elections in the metal workers’ organization show that no artifice and no dictatorship on the part of reformist trade union officialdom can hinder the advance and the victory of the revolutionary idea. Top of the page Last updated on 28 April 2023

MIA > Archive > Fritz Heckert Fritz Heckert The Labor Movement The German Trade Unions from Nürnberg to Leipzig (1 September 1922) From International Press Correspondence, Vol. 2 No. 75, 1 September 1922, pp. 561–563. Transcribed & marked up by Einde O’Callaghan for the Marxists’ Internet Archive. Public Domain: Marxists Internet Archive (2020). You may freely copy, distribute, display and perform this work; as well as make derivative and commercial works. Please credit “Marxists Internet Archive” as your source. I. From Nürnberg to Halle If we stop to survey the period of the German trade union movement between the two trade-union congresses at Nürnberg in 1919 and at Leipzig in 1922. we note a development that is of great importance to the trade union movement throughout the world. In the early summer of 1919, the German Revolution had again shaken both the whole state organism and the economic structure of the country. Large sections of German labor were of the opinion that by immediate direct action they could shift both the economic and political balance of power. And especially the battles carried on under the direct supervision of the shop stewards, without the workers referring the matter to the union officials, gave rise to the opinion that the tendencies working for revolutionary activity of the German trade unions (instead of the reformist attitude) would soon gain the upper hand. The social-patriotic, reformist attitude of the trade union officialdom and the complete abandonment of the principles of class struggle during the war and the first months of the revolution, had combined to create a sharp, rapidly growing opposition. Nearly two fifths of all delegates to the Nürnberg trade-union congress were radical elements believing that they had the backing of the majority of organized labor and that only by employing devious tricks could the bureaucracy secure for itself a nominal majority. The central problem, labor industrial truce or class struggle, was already more or less clearly formulated, in Nürnberg. Many workers had been sorely disappointed by the truce policy during the war, and by its peace edition, – the policy of collaboration. They were determined that labor’s organized forces, the trade-unions, be employed for creating guarantees safeguarding labor against any renewal of the economic and political dictatorship of the bourgeoisie. The trade-unions had assumed formidable proportions; they comprised then 5,400,000 workers, and were adding tens of thousands every week to their membership. This rapidly growing mass of organized workers brought two tendencies into the trade union movement. First, that of making the shop steward committees into militant organs of the workers, and secondly, that of reshaping, the craft unions into industrial unions, which were considered better weapons in the tremendous economic struggles. Even if the revolutionary wing of the trade union movement did not carry the day at the Nürnberg Congress, there was reason to hope that the final victory would only be a matter of months. The majority of the 191 opposition delegates belonged politically to the Independent Social Democratic Party (USP); only 7 were members of the Communist Party. The USP was at that time developing towards the left, a strong mass party counting its adherents chiefly among the industrial proletariat. The following year witnessed the increase of the total trade union membership to 7,890,000. But the revolutionary spirit did not keep pace with this growth. And although the general trade union opposition gained another victory at the metal workers’ congress (in the summer of that year, when the oppostion led by the USP. gained the majority and thus the union) there was no gainsaying the fact that the reactionary attitude of the trade-union bureaucracy was not effected by the penetration into it of the opposition. Rather the opposite took place. A part of the metal workers’ opposition, which under the slogan, Against Collaboration and for the Class Struggle had carried on the fight for the union, fell down on its slogan and at the shop-stewards’ congress, in October, we saw the Independent metal workers’ leader, Dissmann, fight the resolute opposition side by side with that hardened reformist, Legien. Prior to that congress, the whole opposition had considered the shop steward committees as independent factors and cooperators in the economic struggles of the workers, but the congress itself sealed the fate of the Committees and subordinated them to the trade union bureaucracy as its auxiliary organs. The split within the opposition and the march of the opposition bureaucracy towards the Right and into the Legien camp, coincided with the split of the USP and the fusion of its left wing with the Communist Party. II. The Victory of the Trade Union Bureaucracy. Its Achievements The split of the opposition resulted for the time being, in a strengthening of the reformist ADGB. (General German Trade Union Federation) bureaucracy, and in a weakening of the revolutionary struggle in the trade unions. The opposition had to regain its bearings and to reconsider its aims and tasks; it recognized the urgency of close unity everywhere, and fully grasped the fact that a long-drawn and embittered struggle for the sympathies of the membership would have to precede any attempt at compelling the reformist bureaucracy to retire from their position. The opposition nuclei forming everywhere in the trade unions soon became the target of the trade union leaders, who launched a savage campaign against the opposition groups, the chief weapon being the expulsion of the opposition leaders from the trade unions. The reformist bureaucracy fully believed that by this policy of persecution and expulsion they could stamp out the opposition and thus render their own position impregnable. Brutal measures were employed especially by the officials of the builders’, railwaymen’s and agricultural workers’ unions.

Brutal measures were employed especially by the officials of the builders’, railwaymen’s and agricultural workers’ unions. The latter did not even desist from disrupting the organization in large districts, as long as the opposition was crushed thereby. The situation which the trade-union bureaucracy was landed into by its policy of collaboration, compels it to fight the opposition. No matter what it does or thinks, its foremost aim is to avoid serious conflicts with the bourgeoisie. Out of such considerations it accepted the terms of the Versailles Treaty and pledged itself to exert all its energy for their fulfilment. And just as it submitted to the bourgeoisie in matters of foreign policy, it abandoned at home all the demands of the workers, whenever it became apparent that the bourgeoisie was seriously determined to fight. Germany’s economic collapse and the subsequent political convulsions, often gave the bureaucracy opportunity to parade as labor’s leader. The first of these was the Kapp-Putsch. When the working class had crushed the rebellious military camarilla, ana was getting ready to grasp the fruits of victory, the ADGB concluded with the government and the counter-revolution the widely known Bielefeld Agreement, pledging itself to use all its forces to break off the victorious struggle of labor. The latter was told that the ADGB guaranteed the fulfillment of the 8 points of the agreement which would provide a real protection for the workers. After the workers were once disarmed, however, the ADGB never dreamt of redeeming its promises to labor. The same tactics were employed by the ADGB in the struggle carried on by the unemployed to secure their existence in spring 1921. In order to prevent a serious movement, the ADGB formulated ten demands, not one of which was ever complied with. In the autumn of the same year, the mark had sunk to such depths as to endanger seriously the standard of living of the German worker. Again the ADGB entered the political arena with a new series of ten demands coupled with the declaration that unless these demands were complied with, both labor and the economic household would be ruined completely. The first of these demands was the confiscation of 25 per cent of all gold values. The working class, which put its trust into the ADGB, was again sorely disappointed, for nothing whatever was done to enforce those demands. But the policy of collaboration with the bourgeoisie, which the ADGB refused to abandon, and which had compelled it to sabotage the Bielefeld Agreement, the unemployment demands and the demand for the confiscation of 25 per cent of all gold values, was also at the bottom of its cynical betrayal of the railway officials in the Spring of 1922, and its union with all those who openly advocated the use of armed force against the railwaymen whom unbearable economic pressure had forced to strike. The betrayal of the struggling workers was so base and so enraged the workers, that their spirit of solidarity urged them to side with the strikers and they rebelled against the ADGB. The ADGB’s policy of cooperation roused great indignation in the ranks of organized labor. This indignation is unfortunately being expressed by the workers turning their backs on trade unions. The number of organized workers has decreased considerably, during 1921, and the tendency to leave the trade unions is still prevalent. The reason for this, as advanced by the ADGB, was that hundreds of thousands of newly organized members being slow to grasp the advantages of trade unions, had left dissatisfied, while others had been repelled by the inciting activities of the Communists. A third reason given for the decrease is the bad economic situation. To all of which we have the following reply. Firstly unemployment is practically negligible in Germany today; there is even less of it than before the war; such periods have always been noted as favorable for organization. Secondly, wherever and whenever Communist work was successful in the trade unions, there was the least decrease of membership to be noted. Thirdly, the decrease of membership is proportionate to the increase of the aggressiveness of the bourgeoisie, the partner of the trade union bureaucracy. This is made quite clear by the market decrease after the assassination of Rathenau, when the trade union bureaucracy, by steering into shallow waters the struggle against the reaction, which the workers had taken up with so much energy, became a party to the resurrection of reaction. In all other economic and social questions, the reformist trade union leaders have also failed miserably. In order to preserve cooperation, they yielded to the employers in the matter of the workers’ rights and social institutions, and were even in part ready to sacrifice the eight-hour day. The shop steward committees have been shorn of their power to a greater extent than even the employers had intended to. III. The Leipzig Trade Union Congress and Our Prospects At the trade union congress in Leipzig, the ADGB had to account for its policy, and German organized labor has drawn the conclusions. Wherever the opposition secured a footing it routed the reformist collaborators. Even if only 90 of the 700 delegates at the congress belonged to the Communist opposition, there can be no doubt that these 90 had the backing of 35 to 40 per cent of German organized labor. Only by various manipulations did the bureaucracy succeed in securing a big majority. But although the opposition at Nürnberg had reason to hope that victory would be theirs, and the old bureaucracy had to prepare for the worst, the latter was nevertheless better able to defend itself and to maintain its position in Nürnberg than in Leipzig, where the managing committee of the ADGB, in spite of its SPD majority, was defeated on all points. Only in mere routine matters could the bureaucracy count on the support of the majority; in the voting on the questions of collaboration, industrial unions, and other important matters, the majority was either against the ADGB or it was so composed as to render the continuation of the old policy impossible. During the last three years, Germany’s economic situation has been growing from bad to worse, and even the most backward workers are beginning to understand that collaboration, leads to abject misery, and that other ways and means must be found to safeguard labor’s existence.

Prompted by these and similar considerations, the organized workers are massing on the left, confiding more and more in the Communist leaders and refusing to tolerate any longer the persecution of Communists. The ADGB has learned nothing whatever since Nürnberg. In the days of labor’s direst privation it was still aiding the bourgeoisie, and no outbursts of indignation on the part of the membership could move it to abandon that policy. Having sacrificed its demands after the Rathenau murder, it now steps forth and declares boldly; our principal task is to oppose the Communists. This, in a period of capitalist aggression, at a time when the sudden rise of prices, when reaction rears its head once more! The next few months will convince the ADGB that the workers have other matters to look after: to organize themselves against the bourgeoisie and all those in league with it. The campaign against the Communist opposition will end with the defeat of the trade union bureaucracy. That is the balance of Leipzig! Top of the page Last updated on 9 August 2021

MIA > Archive > Fritz Heckert Fritz Heckert The Class Struggle The General Strike in Germany, its Development, its Effect and its Lessons (6 September 1923) From International Press Correspondence, Vol. 3 No. 59 [37], 6 September 1923, pp. 649–651. Transcribed & marked up by Einde O’Callaghan for the Marxists’ Internet Archive. Public Domain: Marxists Internet Archive (2023). You may freely copy, distribute, display and perform this work; as well as make derivative and commercial works. Please credit “Marxists Internet Archive” as your source. On the anniversary of the founding of the German Republic, 12,000 shop stewards representing the workers of Greater Berlin assembled m Berlin, and resolved to enter upon a general strike, and to call upon the workers in town and country to participate in it. The strike was called for three days; its demands included political and economic aims. Now the strike has terminated without all the demands having been realized, the bourgeoisie and social democracy haste to exclaim; “The general strike action has completely collapsed, the workers have been lured to rum by the communists, but the collapse of the general strike has at least had the beneficial effect that the Communist Party is completely done for and the workers have been cured of all ideas of communist putsches.” At the same moment, when all bourgeois and social democratic newspapers are writing in this fashion, the minister of police. Severing, issues a Ukase declaring the National Committee of the Factory Councils and all its subcommittees to be dissolved. Words and deeds are here completely at variance. If the workers have completely rejected communism, if the Communist Party is absolutely dead – then whence the necessity of an exceptional law against a committee of shop stewards which has entirely lost all influence owing to the outcome of the movement? The bourgeois papers and the social democrats are forced into such contradictions. They must keep up their own courage and that of their readers. If we desire to form a correct estimate of the last general strike, we must accord it a somewhat more thorough attention than the social democratic and bourgeois newspapers care to give it. The Vossische Zeitung writes: “The communists enjoyed an incredible boom last week (before the general strike), but they have lost the entire game by their foolishness. If they had waited, the ripe fruit would have fallen into their mouths. They have lost everything by their stupid general strike.” The social democratic Vorwärts expounds at great length that such a general strike was destined to fall from the beginning, as the trade union leaders had not organized and led it. No general strike has any prospect of success miles properly prepared, and less its demands have been thoroughly examined as to their expediency by the competent authorities. We need not be offended when the Vossische Zeitung and all the other press duennas write such foolish nonsense about the labor movement. But we have a right to expect more from a social democratic paper. As early as 1900, when the problem of the mass strike was pushed into the foreground by the first Russian revolution, our murdered comrade, Rosa Luxemburg, overwhelmed the trade union leaders and party bureaucrats with biting irony and ridicule, because they condemned the mass strike as not fitting into their famous strike formula. She showed that the mass strike is based on other conditions and other laws than the ordinary wages strikes, and that a mass strike, when formulating its aims, will not hold to conditions devised in the conference rooms of trade union bureaucrats. Mass strikes do not fall from the sky. They have to be made by the workers. But before the working masses grasp the intuitive for a mass strike movement, a number of prerequisites are necessary. Were these prerequisites given in this last strike movement? To this question we can reply in the affirmative. The working class of Germany is living under the most wretched conditions imaginable. The bankrupt bourgeoisie plunges the working class into daily increasing misery and poverty. This unbearable misery forces the workers into continuous economic struggles. But the results of these economic struggles are always annulled again by the policy of tire ruling class, The Cuno government was a government which had proved itself entirely incapable of saving German economics, and with them the German working class, from falling over the precipice. The workers knew from experience that so long as this government held the reins there was no hope of emerging from their misery. But experience has also taught them something else in the course of the last few months, i.e., that the social democratic party and the trade union leaders have been tolerating or even supporting this bankrupt bourgeois policy. Thus the working class not only lost its confidence in Cuno’s government, but became very distrustful of the trade union leaders. During the last few weeks the workers have entered into a number of strikes. The net result of these strikes has been that wages had a lower purchasing power at the end of the strike period than at the beginning, that the government ruthlessly employed its forces for the suppression of all strikes, and that the social democratic bureaucracy sabotaged or even combatted the strikes. The working class, owing to these experiences. felt itself thrown on its own resources. When the Cuno government was compelled to convene parliament in order to create for itself a basis for its further rule, the workers in all cities and villages of Germany felt: This government cannot be tolerated any longer.

When the Cuno government was compelled to convene parliament in order to create for itself a basis for its further rule, the workers in all cities and villages of Germany felt: This government cannot be tolerated any longer. It must go! A workers’ deputation expressed this feeling of the masses by the sentence: “It is no longer possible to pace any confidence in this government. If another government comes, there is at least a hope that it will be better than Cuno’s government.” There was no need for the workers to hold any great consultations before formulating their demands: Wages with a constant value – but first of all the overthrow of Cuno’s government. Resolutions and motions to this effect were passed at thousands of meetings. When the Reichstag met, hundreds of workers’ deputations came and demanded of the leading organizations that they should fight energetically for the aims formulated by the masses. But social democracy, and the General German Trade Unions Federation, would not for a moment entertain the idea of a joint struggle of the workers for the realization of the workers’ demands. By Friday, August 10, the head organizations had still not decided to accede to the will of the masses. The proposal made by the Communists, that the General German Trade Union Federation should place itself at the head of the now unpreventable mass movement, and should fight with the masses for the realization of their demands, was scornfully rejected. On Saturday August 11, at 1 o’clock p.m., there was still a three-quarters majority in the social democratic Reichstag fraction for the retention of the Cuno government. The higher bureaucracy still believed that it was possible to hold the workers back from lighting. But when a “wild” plenary factory council meeting, attended by 12,000 shop stewards, resolved on the general strike; when the tramway workers ceased work and the electrical workers at Golpa turned off the current, then the social democrats saw that they could no longer maintain the Cuno government. The mass storm broke the resistance of the social democratic leaders, and swept away Cuno’s government. The bourgeoisie found itself obliged to make great material concessions to the workers in many places. Thus the mass strike brought about the realization of many of the demands made, even before its effects were fully felt. And how was its leadership, its organizatory and technical executive? On Friday, August 10, the trade unions declined to put themselves at the head of the inevitable movement. And yet it was perfectly plain to the trade union bureaucrats that their standing aside could not stem the movement. Their sole consolation was that neither had the communists sufficient power to lead the movement and bring it to a good end. We were told: “The masses are already beyond your control. By next Wednesday the whole movement will be a heap of debris, and we trade union leaders will once more be called upon to help the workers out of the unhappy situation into when you communists have led them.” The plenary factory council meeting had therefore no choice but itself to form a central strike leadership for the purpose of securing the united and uniform advance of the movement. Trade union bureaucracy and social democracy immediately called upon the workers to ignore the instructions issued by the strike central, and to remain at work. Despite this, the strike leaders were able to keep perfected control of the lighting masses. All provocat ons on the part of the bourgeoisie, the police, and the trade union and social democratic bureaucracy, were successfully warded off. In order to undermine the general strike, and to disunite the fighting masses, every available means were employed by the government, the bourgeoisie, and the social democrats, the committees of the national trade union of railwaymen, and of the German railwaymen’s union, declared to the ministers Stresemann and Hilferding that the minister for traffic for the whole German Republic, the notorious General Gröner, must not be permitted to enter the cabinet, or they would not be able to hold the workers back from striking. Under this pressure the new ministers made this concession, followed by further concessions with respect to higher wages. The workers on the overhead railways and tramways were granted large additions to their wages for coping with the rising prices, in order to induce them to desert the ranks. This manoeuvre met with considerable success. The printers, who were also on strike were granted enormous payments per hour; by this they were bought off and the bourgeoisie and the government were enabled to publish their press and poison public opinion. In this strike the electricians did not prove so powerful a factor as has been the case in former movements. This is due to the fact that a number of large power stations connected their systems with one another, while there was no unified down tools policy in this whole network of electric works, for coordination among the electrical workers was extremely deficient. These were circumstances very prejudicial to the strike. To this must be added that the provincial districts were insufficiently prepared for participation in a general strike. The appeal issued by the Berlin factory councils did not reach the ears of the workers throughout Germany until Monday, so that the provinces could not join the movement until Monday afternoon or Tuesday morning. This deprived the strike movement of the impetus of a simultaneous beginning And a third factor calculated to interfere with the coherence and progress of the movement was the fact that the main political demand – overthrow of Cuno’s government had already been realized on Saturday evening, 36 hours before the provinces received the summons to take part in the general strike. The strike leaders devoted every attention to all these difficulties and defects iu the movement. At a fresh plenary factory council meeting, attended by 13,000 shop stewards, they advised that the strike be broken off on Tuesday evening, the term fixed from the beginning of the strike. In making this proposition, the strike leaders felt that the growing united front of the workers must not be destroyed; that it would be unwise to let one section of the workers continue in the struggle whilst others had returned to work. The strike leaders were anxious to avoid the possibility of the section of the proletariat which had resumed work being played off against the section which continued the fight. Fresh schisms among the workers were to be prevented by every possible means. Trade union bureaucracy and social democracy should be given no opportunity of keeping up their pretence of being the saviours of the proletariat.

It was important to gain time, to gather force, to prepare for future struggles, to enlighten those workers who took no part in the strike, to fill up the gaps in the united front, and to learn the real lessons taught by the errors and shortcomings of the movement. The 13,000 shop stewards assembled, showed complete understanding of the position of the strike leaders. With hearts filled with anger at the despicable behaviour of the leaders of the trade union organizations, and at the fresh treacheries of the social democratic leaders, the shop stewards decided that the fight be discontinued all round. Very few votes were cast against this proposition of the strike central. The meeting listened in perfect silence to the many speeches on the deficiencies in the movement, and the resolve matured in every heart to carry on the work with the utmost energy, to utilize the lessons taught by the movement in the interests of the proletariat, and thus to step forward into fresh battles with greater unity and strength than ever before. The leaders of a great struggle have never before received such a mighty and unanimous vote of confidence as that accorded to the improvised strike leadership of the general strike by the plenary meeting of the Berlin factory councils. There have been many cases in which the trade union bureaucracy and social democracy have practised shameful treachery, and in these cases there have always been thousands and thousands of trade union members who nave thrown aside their trade union books and given up their membership; but this is not the case this time. The fighting workers have recognized that they must keep their trade unions united, and that it is their duty to rid themselves as rapidly as possible of the treacherous functionaries. Those social democrats and trade union bureaucrats who are calculating on being able to resume their rôle as saviours of the proletariat are doomed to disappointment. The masses are filled with an unexampled hate of bureaucracy. And when the social democratic newspaper scribes assert that the communists will be called to account by the masses for the “senseless putsch”, their words are flatly contradicted by the events in the trade unions and factories. This general strike has enormously increased the feeling of self-reliance among the workers. The Communist Party has won many tens of thousands of members. The masses recognize the Communist Party as the sole leader of the revolutionary proletariat, and the prohibition of the activity of the national committee of factory councils by the social democrat Severing, is the proof that the social democrats have lost all confidence in being able to regain the masses. The general strike has brought us the coalition between the social democracy and the bourgeoisie: the alliance of bankrupt bourgeoisie with bankrupt reformism. These two partners can only work together for their common ruin. For a certain time they can rule with the aid of martial law, and at the points of Fascist and national army bayonets. The next general strike of the workers will make a clean sweep of these methods of governing a working people, and will shatter to pieces the throne of the coalition confraternity. We share the opinion of the social democratic Chemnitzer Volksstimme, that: “the coalition signifies for social democracy and reformism the last move before checkmate”. Meanwhile we leave it to the bourgeoisie and to the social democrats to continue to philosophize over the “breakdown” of the Communist Party and the general strike. The German working class will march forwards and act. Top of the page Last updated on 28 April 2023

MIA > Archive > Fritz Heckert Fritz Heckert The Labor Movement The Lessons of the Last Miners’ Strike (15 March 1923) From International Press Correspondence, Vol. 3 No. 26, 15 March 1923, p. 206. Transcribed & marked up by Einde O’Callaghan for the Marxists’ Internet Archive. Public Domain: Marxists Internet Archive (2021). You may freely copy, distribute, display and perform this work; as well as make derivative and commercial works. Please credit “Marxists Internet Archive” as your source. The strike of the French miners which ended on February 21 raises the question of how far the struggles of the miners have any possibility of success when conducted on national lines. All great strike movements among the miners during the last few years have in the main failed. Either the strike collapsed as a result of betrayal on the part of the reformist leaders, or it has been defeated by the forces at the disposal of the capitalist state. The workers have only in a very few cases attained a partial success. And only then when the circumstances were particularly favorable, This latter was the case in the American miners’ strike, and in the strike of the French miners. But all other fights have been lost, and were bound to be lost under the circumstance in which they took place. Two currents are struggling against one another in the trade union movement: the one in favor of working unity with the bourgeoisie, and the other opposed to this – the revolutionary current. Nearly all the miners’ unions are in the hands of leaders who support working unity. These leaders are of the opinion that the class interests of the proletariat should be subordinated to the general interests of the state, that is, to the needs of the capitalist state. Since the revolution, every strike undertaken by the German miners has been systematically wrecked by the trade union bureaucracy, and this trade union bureaucracy has invariably explained to the workers that state necessity demanded the abandonment of the strike. This was the case in Czechoslovakia, and in Poland. We can still clearly remember the utterance of J.H. Thomas, the chairman of the Amsterdam Trade Union International and leader of the English railwaymen’s union: it was thanks to the command issued by him to break off the last miners’ strike in England that the fall of the English governing power was prevented. The Frenchman Bartuel was one of the most zealous advocates of the dictates of the Spa agreement, which forces the German miners not only to toil for the German capitalist, but to permit himself to be robbed at the same time for the benefit of French imperialists. The revolutionary section of the workers however, is of the opinion that every endeavor must be directed to defend the interests of the workers as a class. The interests of the workers unlike the interests of the bourgeoisie, do not clash on any national frontier. The workers of all countries have one common interest, the bourgeoisies have opposing interests. When revolutionary workers stand for a ruthless struggle for the defence of workers’ interests, they, at the same time, stand for the international action of the proletariat against capitalism and its attendant dangers. The coal agreement made at Spa threw great numbers of English miners out of work, and rendered the French and Belgian miners incapable of delending their wages and working conditions with any prospect of success. The low wages of the German miners are to blame for the low wages and misery of the miners in all other countries. The reformist miners leaders know this very well, it can scarcely be assumed that they are too stupid to see it. But their relations with their national bourgeoisie are much closer than their relations with the international proletariat, and with the collective interests of the working class. This is again plainly illustrated by the miners’ strike in France. In the first place the French capitalists had created adverse conditions for obtaining coal supplies, in both areas, by the occupation of the Ruhr. Germany is cut off from the Ruhr coal. Transport to France is prevented by the counter-action of the German railwaymen, who have stopped work on the railroads of the occupied territory. For the first time for many years the French miners had the opportunity of utilizing the embarrassment of the French capitalists for the purpose of gaining better wages and working conditions. The revolutionary miners utilized the situation, but the reformist leaders demanded blackleg service from their followers. They could not permit a wage strike of the miners to hinder the imperialist adventure of the French capitalists. Thus Bartuel and his friends have deprived the French workers of the success of their wage struggle, and have sided with Poincaré. The case was exactly the same in Czecho-Slovakia. The miners, long suffering from capitalist attacks, during the last few weeks, attempted to fight for better wages. But as Czechoslovakia has friendly relations with France, the reformist leaders of the Czecho-Slovakian miners thought fit to oppose the fight of the Czech miners. In England the miners’ leaders also seized the opportunity of rendering their ruling class a service. The struggle in the Ruhr area and the strike of the French miners gave the English colliery owners the chance of doing good business. Now they were able to sell coal to the Germans and French. This favorable state of their market was utilized by the English bourgeoisie, who doubled the price of coal.

This favorable state of their market was utilized by the English bourgeoisie, who doubled the price of coal. The English colliery owners triumphantly announced that, thanks to this stale of affairs, the number of English unemployed had sunk by 125,000. The English reformist leaders share the joys of their bourgeoisie so fully, that Mr Hodges replied to the demand made by the revolutionary miners of various countries, for the organization of a joint action against Poincaré’s imperialist policy, with the answer that the situation was not suitable for starting such a movement. And indeed, why should the chairman of the miners’ international trouble about proletarian measures for international fighting, so long as the English bourgeoisie is doing good business, and few crumbs from its full table fail to its lackeys. In England the rise in the the price of coal is accompanied by a rise in food prices, and it will not be long before the English miners will have to fight to have their wages adjusted to the higher prices. If Poincaré is victorious in the Ruhr, enormous quantities of cheap German coal will speedily appear on the French market, and it will be impossible for the French miners to defend their working conditions against the capitalists. Should the Ruhr conflict end with the victory of Poincaré, the Czech miners will also be forced into a precarious position. Should the German bourgeoisie come to an understanding with the French in the Ruhr, it will not be long before the English miners will be again, out of work. The German bourgeoisie utilizes the Ruhr conflict to lengthen the working hours of the German miners. When once these worsened working conditions have been introduced, then it is a matter of indifference whether Poincaré or Cuno is the victor, for the bad working conditions imposed on the German miners will have a decisive influence on the working conditions of the miners in other parts of the world. Instead of the miners of Europe mutually supporting each other by joint action for the defence of their class interests, and thus striking a severe blow at their class enemy, they have, under their reformist leaders, done precisely the contrary. The most favorable moment for joint action is again missed. The hand outstretched by the revolutionary worker for the formation of a united front is scornfully rejected. Hodges refuses any alliance, that is, with the working class, but not with the English bourgeoisie. Bartuel, who organized the blackleg action of the reformists in France, has not only thereby helped French mining capital out of a critical situation, he has at the same time weakened the labor organizations, and rendered hundreds and thousands of workers incapable of fighting. But the behaviour of the German reformists during this period has been the most idiotic of all. They are desirous that the English and French labor leaders, especially the miners’ leaders, help them to ward off the attack of French imperialism. At the same time they are in such a state of senseless rage against workers holding communist views, that they attack the fighting communists in the most despicable manner and do not desire the victory of the revolutionary miners of France, but the victory of the reformist Bartuel, the ally of Poincaré. Is it to be wondered, under such circumstances, that the workers are reduced to impotency and the Stinnes of every country triumph? The French miners’ strike has once more demonstrated the complete bankruptcy of reformism. The cowardly and bourgeois-coalition attitude of the reformist leaders can serve nobody but the capitalists, nobody but the national bourgeoisie of each country. The breakdown of economics, and of the labor movement, is bound to become continually worse under such circumstances, unless the revolutionary workers succeed in completely overthrowing the whole wretched reformist policy. The mining strike in France has opened the eyes of many thousands of pit slaves. They have recognized the dangers of reformism, and are turning to the revolutionary trade union organizations of the C.G.T.U. The example set by the French combatants has had a stimulating effect upon the Belgian miners. The resistance of the Belgian coal miners against their employers is growing; these miners are no longer listening to the hoarse shouting of the Belgian reformists, who maintain that the unrest among the Belgian miners is solely the result of communist agitation. The revolutionary miners must utilize the unrest obtaining among the miners of every country. They must show their fellow-miners that only by joint action can they hope for success, that they must no longer permit themselves to be exploited by their reformist leaders for the benefit of their national bourgeoisie, but they must all stand together in one common front for the ruthless defence of their class interests. Fresh conflicts are arising all round; it must be our work to prepare ourselves thoroughly for the fight, that it may end in a victory over the capitalists and reformists. Top of the page Last updated on 2 September 2022

MIA > Library > Zetkin > Heckert > Newbold > Radek Zetkin et al. Open Letter To the London and Vienna Internationals and the Amsterdam Trade Union International (16 January 1923) Source: International Press Correspondence, Vol. 3 No. 8, 19 January 1923, p. 62. Transcription & HTML Markup: Einde O’Callaghan for the Marxists’ Internet Archive. Public Domain: Marxists’ Internet Archive (2021). You may freely copy, distribute, display and perform this work; as well as make derivative and commercial works. Please credit “Marxists Internet Archive” as your source. On the 13th of this month the Executive of the Communist International had addressed the question to you, as to what you intend to do in order to carry out the decision of the Hague Conference regarding the organization of a general strike in case of a war. The Executive of the Communist International has empowered the undersigned, together with Marcel Cachin, to enter into negotiations with you on the question of a common fight against the danger of war. Owing to the persecutions to which the Communist Party of France is subjected because of its struggle against the occupation of the Ruhr, and owing to his impending arrest, Comrade Marcel Cachin is unable to participate in these negotiations. The undersigned are awaiting your reply to form a joint Committee of Action with you, capable of taking up lhe struggle against the threatening war. At the Hague, the Russian Trade Union delegation proposed that an international protest strike be called for the 2nd of January. This would have demonstrated to the international bourgeoisie the determination of the proletariat to wage war against the dangers of fresh wars. At the Hague, the Russian trade union delegation predicted that January would surely see the occupation of the Ruhr. Our warnings at the Hague fell on deaf ears. Those present at the conference were satisfied with platonic protests, in the belief that bourgeois diplomacy would find some way out. But as we have seen these last four years, capitalist diplomacy has completely failed to create the simplest conditions for the peaceful development of the world. The occupation of the Ruhr threatens the world wit ha new and unprecedented wholesale slaughter. The French plan aims not only at compelling the German capitalists to pay over money, but also to force them to admit French interests to the exploitation of these properties and thereby to add great numbers of cheap workers to the low paid labor army already at the disposal of Entente Imperialism. But this plan was based on the assumption that the French occupation authorities would be able to supervise the Ruhr Valley, to keep industry going and, by distributing or retaining the coal, to force the German industry into submission. But with the removal of the German Coal Syndicate from Essen to Hamburg, the French plan suffered shipwreck. The French occupation authorities are helpless, and find it impossible to keep the Ruhr industry alive. Every succeeding day makes it more difficult for them to pay out the miners' wages. For this reason it is almost certain that they will reach out beyond the boundaries of the Ruhr Valley in order to tighten their pressure upon the German people. Already we near of war preparations in Poland. France will set her vassals against Germany. But apart from all this every moment is liable to bring a collision between the French troops and the Ruhr population, In which case the nationalistic spirit in Germany may reach its explosive point. Should It happen that the French military elements will take advantage of Poincaré’s difficulties in order to drive him on towards the Rhine-Secession-Policy, – the policy of dismembering Germany, – it may also well be that the chauvinistic elements in Germany will precipitate a war, in order to profit by the nationalistic craze for the purpose of seizing power by means of a counter-revolution. Already The governments on either bank of the Rhine do not know what the morrow may bring. On the 31st of January the situation will become more acute, for on that day Germany will not be in a position to pay the sums demanded of her. The possibility then arises that the separate action of the French government may turn into a general inter-Allied action. In that case the German people may be faced with the only alternative: Complete subjugation and enslavement, – or War. The Hague conference has decided that the proletariat would fight the danger of war with all means at its disposal, and that in case of imminent danger a general strike would be called. The danger of war is here. Only the blind can fail to see it It is not only a question of war between France and Germany alone. Such a war would set the whole East and South East of Europe ablaze. The capture of Memel by Lithuania and the events on the Roumanian-Hungarian frontier demonstrate clearly the acuteness of the present situation, in which all forces tend to render every central European conflict, the starting point for a fresh European catastrophe. We doubt not but that the leaders of the Amsterdam Trade Union International, as well as those of the Vienna and London Internationals see the situation in the same light as we do. We therefore call upon you to lend reality to the solemn declarations which you have made at the Hague only a month ago, and to take the preparatory measures for the undelayed organization of the mass strike, we call upon you to meet us without delay, in order to decide upon this necessary steps to be taken. The parties of the Communist International and the working masses behind the Red Labor Union International will do their duty, as our French comrades have sufficiently demonstrated. We propose the 31st of January as the day when the international protest mass-strike is to begin. The duration of the strike must be decided upon by the joint conference of the three political and the two trade union Internationals. We propose that this conference be held on the 21st of January in Berlin. Should you prefer another place, we have no objection whatever. We only ask you to act immediately, so that the undersigned may have ample opportunity to obtain the necessary visas. Berlin, January 16, 1923 For the Communist International Clara Zetkin, Walton Newbold, Karl Radek For the Red International of Labor Unions Heckert P.S. The other delegates, Comrades Dudilieux, Hais and Watkins, could not be reached until now. Top of the page Last updated on 11 August 2021

MIA > Archive > Fritz Heckert Fritz Heckert The Labor Movement The Party and the Trade Unions in Germany (10 October 1922) From International Press Correspondence, Vol. 2 No. 87, 10 October 1922, pp. 658–659. Transcribed & marked up by Einde O’Callaghan for the Marxists’ Internet Archive. Public Domain: Marxists Internet Archive (2021). You may freely copy, distribute, display and perform this work; as well as make derivative and commercial works. Please credit “Marxists Internet Archive” as your source. The beginnings of the German trade union movement – The practice of the former Social Democratic Party – The subordination of the Party to the trade union bureaucracy – Its consequences: 1914 – Confusion of ideas after the Revolution – The Communist tactics * In Germany, more than in every other country, the question of the relationship between the workers’ party and the trade union has at all times played an important role. We may justly say that the trade union movement in Germany owes its life to the Social Democracy. Founded by Socialist workers, its development always remained bound up with that of Socialism. The anti-Socialist law of 1878 ruined at the same time both the party and the trade unions. After their abrogation, the trade unions turned reformist and their leaders hoped to divert them from the influence of the Social Democratic Party. The political neutrality of the trade unions was affirmed, as well as the necessity for giving them an independent central direction. Perceiving a hidden motive in the plan, formulated by Karl Legien, of creating a “general council of the German trade unions” whose rights would be equal to those of the party, William Liebknecht sharply attacked the project at the Congress of the Social Democratic Party in Cologne, 1893. Accusing the trade union leaders of the intention to turn the masses away from the class struggle and to lead them to reformism, he declared that the independence of the unions would only be a concession to the bourgeoisie, accustomed as they were to regard labor organizations as subversive, and that all opportunism of this sort was only in adaptation to the bourgeois state. The majority of the Socialist workers under the influence of labor leaders all belonging to the Democratic Party, found the fears of William Liebknecht exaggerated. No one wished to believe that it would be possible ever to separate the party from the unions. The Congress of the Social Democrats decided that all members of the Party ought to belong to the trade unions while the trade union Congress enjoined its members to affiliate with the Party. The trade unions were regarded as recruiting fields of the Party. When the revisionist movement arose about 1900, it hoped to gain support in the labor organizations. When, in 1903, Theodor Boemelburg, president of the bricklayers’ union pronounced that celebrated sentence at the Congress of Cologne, “The trade unions and the Party are but one and the same”, it was already then no more than a hollow phrase. The trade union leaders made use of the General Council of Trade Unions to extend their influence over the party and to attempt to dominate it. The Social Democratic Congress of Mannheim (1906) decided that the Central Committee ought to come to an understanding with the trade unions before any mass movement. In that way the General Council of Trade Unions became a new central executive organ of the working class. Certainly, in signing the pact of Mannheim, it assumed the same obligation on its part; but this cost it nothing, as it was resolutely hostile to all mass actions. Boemelburg declared, “The general strike is a general madness!” and unanimous applause drowned his voice. When the imperialist war broke out, the victory of the trade union bureaucracy over the Central Committee of the party was an accomplished fact. On the 4th of August 1914, the trade union leaders flatly declared that they would compel the leaders of the party to vote the war credits and to realize the fatal union with the bourgeoisie. The party capitulated unconditionally. The dictatorship of the Council of Trade Unions over the Social Democratic Party was so little concealed that when during the summer of 1915 a feeble opposition manifested itself in the party, the labor bureaucracy uttered the following threats: “We must support with all our power the majority of the Central Committee of the party and urge it on to the path we deem good. And even if the opposition should seize power, we would not be able to remain neutral, and would be obliged to create a new party.” Fritz Ebert then received the warm congratulations of Leipart, the president of the General Council of Trade Unions, for having energetically emphasized the will of the Central Committee of the party to continue at all cost the policy of August 1914. The Social Democratic Party of Germany was preparing to follow the path of denials, betrayals and counter-revolution, under the impulsion of the bureaucratic trade unions, up to the eve of the November Revolution, up to August 8th, 1918. Since before the war a small group of militant revolutionaries, under the leadership of Rosa Luxemburg, had been battling to lead the trade unions back to the class struggle. But its efforts met with little success. Though gagged during the war, it was yet they who recommenced serious propaganda for revolutionary action in the trade unions. We have not forgotten that at the significant Congress of the Independent Social Democratic Party at Gotha, during Easter 1917, Hugo Haase exclaimed: “The trade unions are the most resistant ramparts of reaction. Without them the war would have been ended long ago!” But at no time did the leaders of the Independent Party cause a breach in these ramparts. Since the war, during the Revolution, and up to the present, the labor leaders and the Social Democrats have persisted on the path they had traced before the war, and their constant collaboration with the bourgeoisie has been but the logical consequence of this spirit. During the Proletarian Revolution, nationalism, reformism, and the deeds of the trade union bureaucracy during the war and the revolution, produced such disgust in the end, that the workers came to the most divergent conclusions as to the relationship between the party and the trade unions.

Some thought that so much treason had been possible only because there existed two parallel organizations (party and trade unions) and that it was necessary to create a united political and economic organization. Others believed the cause of the social-patriotic deviations to be found in the form of the trade union organizations. They advocated the establishment of unions on a federal basis, which would assure the broadest autonomy to every organization and locality. Still others urged the most complete political neutrality of the unions. The confusion was increased by the direct action of the working masses, organized in factory and workshop councils at the beginning of the revolution. From these direct actions the militants drew the conclusion that the epoch of trade unions had been ended and that it was necessary to replace them by factory councils. To arrive at real revolutionary lucidity, the German proletariat had to undergo a long series of failures and defeats in its struggle against the capitalists and the State, in its efforts designed to establish new unions, in its attempts to put new trade union doctrines into practice. In the course of these experiences, the number of workers grew who recognized that trade unions are necessary organizations, that they have certain definite primary tasks to fulfill during the revolution and the period of transition from Capitalism to Socialism. On this basis it was possible to agree upon action. Since 1920, sincere revolutionists have been convinced that the trade unions could tackle their tasks only on condition of definitely breaking with their former policy of collaboration of classes. This collaboration, in fact, subordinated the vital interests of the proletariat to the conservation of capitalism; sacrificed the eight-hour day, wages, the production of labor. If the workers wish to maintain or improve their conditions of living they must defend themselves against capitalism; and the least resistance today has revolutionary consequences. In order successfully to oppose its class-enemy, the proletariat as a whole ought to stand up against it; whence the need for a united front, the first condition for proletarian action against capitalism. To this condition we can add another: the international concentration of the active proletarian forces. These conditions are well founded, and it is they that divide the proletariat into two opposing camps: one of the revolutionary class struggle, and the other of cooperation with the bourgeoisie. The more the revolutionary influence extended into the unions, the more energetically reacted the trade union bureaucracy. To combat the latter, to defend itself, to enlighten the working class upon the dangers of cooperation with the bourgeoisie, the revolutionary workers organized in the Communist Party created fractions or “cells” in the unions. These new groups undertake systematically to win the unions for revolutionary action. They interest themselves in all the aspects of the workers’ life and aim for united action of all the proletarian elements. The Communist workers of Germany have also commended the decisions of the Second Congress of the Communist International on the functions of trade unions. The Central Committee of the German Communist Party has established a Trade Union Council which gives a single direction to all the Communist nuclei in factory, shop, or union, and organizes national and local groupings, we are benefiting today from the practical experience of 18 months of assiduous labor. In our struggle to conquer the unions we sustained grave losses. Thousands of good militants have been expelled from the unions by the reformist bureaucracy. The General Council of Trade Unions has just proclaimed that the principal task of the unions consists actually in fighting the Communist cells. Despite everything, however, we have succeeded in binding ourselves more and more strongly to the working masses. The elections of the factory committees, of local trade union committees, of representatives to the congress constantly attest to the growth of our influence. In 1921 the Communist who was a member of a “cell” was very simply expelled from the trade union organization. This year the Congress of German trade unions has recognized the Communist “cells”, not legally to be sure, but actually. The bureaucracy had to yield before facts. We are only in the beginning of our work, but we cannot doubt of success. We shall lead the trade unions back to the class struggle. Better yet! – Our revolutionary activity in the trade union movement strengthens it. if after so much deception the German trade unions still remain the organizations of the masses they are, it is in a large measure thanks to us. It is our activity which has restored confidence to the workers. The extension of the revolutionary movement among the trade unions cannot but proceed together with the extension of Communist influence over the masses. The unions are again becoming the recruiting field of the revolutionary political organization of the proletariat. And we are seeing the day approach when the party and the trade unions will constitute anew but a single revolutionary force directed against the capitalist system. Top of the page Last updated on 2 January 2021

MIA > Archive > Fritz Heckert F. Heckert Discussion The Tasks off the Communists in the Trade Union Movement (December 1922) From International Press Correspondence, Vol. 2 No. 116, 22 December 1922, pp. 965–966. Transcribed & marked up by Einde O’Callaghan for the Marxists’ Internet Archive. Public Domain: Marxists Internet Archive (2021). You may freely copy, distribute, display and perform this work; as well as make derivative and commercial works. Please credit “Marxists Internet Archive” as your source. Comrades, Comrade Lozovsky told us this morning we must adopt a clear, unequivocal policy on the trade union question; he warned us especially against precipitate policy and advised us to reject any tactics which might lead to a split in the trade unions. He stated this very clearly. He said: If we had accepted the slogan of splitting the trade unions, or in anyway acquiesced in it, it would have meant destruction for the whole Communist movement. I also believe that we communists would have been guilty of the greatest error if we had propagated the splitting of the trade unions, or made any concessions to those elements that want to bring about such a split. I hope that this Congress will express clearly that every splitting tendency must be fought ruthlessly. It is absolutely necessary to show to the working class that we are for unity of the trade unions, if we are to carry on any serious propaganda for the United Front. We would make ourselves ridiculous before, yea, despised by the whole working class if we were to fight for the United Front and sympathise at the same time with the splitters. However, in many countries, the trade unions have already been split, not only just now by the Amsterdamers, but because parallel organizations existed in those trades before and during the war. At the last Congress we had put before our comrades that it was their task to work in those dual organizations for union. Our communist comrades have not done all they could in this line. In fact, in all countries where the trade unions are split, the communists, instead of fighting for one common goal, have often opposed one another. I would therefore like to say this: every communist who does not support other communists, who are active in some other organizations, helps the reformists and those who want to break up the trade union movement. It is therefore our first duty as communists to eliminate all our little differences and to work together for a common goal. I absolutely admire our Italian comrades who have brought it about in their organization that their members understand that they must be active even in Fascist organizations, that even there we must create our cells. The policy of cell formation has been much attacked even after the Third World Congress. In the German Party, for instance, there was quite a conflict on this point. There was a whole group of comrades who declared that cells were bad, and there developed among those comrades a liquidating tendency which purposed to destroy the whole trade union work of the Comintern and the whole international communist trade union movement. We have opposed these elements. This tendency was the cause of the Friesland crisis. We have expelled those people from our organizations and conducted a decisive fight to realise the unity of all revolutionary comrades. Naturally there have been unnecessary conflicts in this struggle; many a communist did not speak or act wisely enough: But it does not suffice to deal with the opposition to so-called revolutionary unions in our Party with a few words, as Comrade Lozovsky did when he declared that Comrade Masloff had acted very foolishly and written an idiotic article against the communists, and that Comrade Heckert and Brandler saved the situation. Comrades, I will not agree to have this order of the Salvation of the Unions pinned on my breast; I will not accept to characterise Masloff’s action as criminal and damnable without first saying that the unionists are partly responsible lor it. We must divide the blame between both sides, if we wish to be just. The fault of the Party is that it did not realise that this policy would make for conflicts if we did not carry on sufficient preparatory work in the unions. We relied upon it that the Communists in the union would to the work. What happened was that our Unionist friends fought against the formation of factions and our Party comrades let the thing drag without any work. That is why it came to such conflicts with the union. Luckily, we were able to reach an agreement at the union Congress at the beginning of October and to create a basis for harmonious cooperation in the future. But many other Communist Parties have followed this bad example of not forming cells within the Unions. I would like to mention especially two parties that have been guilty of this omission. First the French Party which in spite of its promises of last year to become active in the C.G.T.U., to build cells within that Federation, did nothing till the events came to a. point when the split was accomplished and the French Trade Union movement became a perfect muddle. At its Congress in Marseilles, the French Party had the opportunity of gaining the leadership of the revolutionary movement in France if it had followed the advice which had been given it, namely, to create a program which would unite all revolutionary forces. The French Party did not do this; nothing was said at the Congress as to what the Communists should do in the Trade Unions; Comrade Magoux who has since been expelled is not a little responsible for the crisis in the French Party. This should be a lesson to us for the future. When a Party takes a stand on all questions before the working class, it will be possible to create closer connections between the leaders of the Unions and the Party as a result of which such people as Monmousseau and Monatte will become members of our Party, our Party will become a real proletarian organization and no one who does not base the policy of the Party on the proletariat will get the leadership. The old dissentions must be put an end to. The Comintern must use all its influence on the leaders of the Party and the C.G.T.U. to co-operate in the interests of the working class of France. A word on Czecho-Slovakia. We found the same tendencies in the Czecho-Slovakian Party.

We found the same tendencies in the Czecho-Slovakian Party. It was primarily the Trade Union leaders in the Party who opposed the formation of cells. Many comrades said quite openly: Why cells? That only leads to trouble; it suffices when the leaders of the Trade Unions are Communists. But it must have become apparent to our Czechoslovakian comrades that tins did not suffice. Had they formed strong cells in the Unions a year ago, Tayerle would not hold today such a position as he does. I believe that our bad experience in Germany, and the example of France and Czecho-Slovakia, will teach us in the future to pay more attention to the resolutions of previous Congresses. A few words more on the German situation. We will not say that all our attempts to win the Trade Unions were good attempts. Comrade Lozowsky said this morning that tens of thousands of member; are leaving the agricultural organizations without the Party taking any action. There are other causes for this, however, than those Comrade Lozovsky advanced. It is true that the German movement of the agricultural workers has lost hundreds of thousands of members. But the reason is that these organizations are led by a bureaucracy which does nothing but make “Socialist" politics, and the interests of the workers are subordinate to the interests of the social-democratic politicians. Since no one interested himself in the agricultural workers, these workers rebelled. Unorganized before the war, the agricultural workers in Germany had an organization of 800,000 workers after the revolution. At the highest period of its existence, the “Deutsche Landarbeiterverband” numbered 27,000 members; during the war this number fell to 3,000. This post-war organization was therefore something quite new, and the bureaucracy of the Federation made use of the organization to further its own interest. We had already attempted to approach the agricultural workers in 1919. We formed a so-called Communist agricultural union. This was a complete failure. If the revolution had proceeded further, had we been able to do something in the interest of the agricultural workers, it would have been a different story. Since this was not the case, the Social Democrats kept the control of the agricultural workers organization in their own hands. In the following years, hundreds of thousands left the organization. Our comrades were faced with the problem: should they reunite these working masses into a new organization led by Communists, but which would not be capable of fighting, or should we not be afraid that the Amsterdamers would use this as a new excuse for an offensive against the Communists, and would say, here you have another proof that the Communists are trying to split the Labor Unions. Had we attempted to form a new organization at the time when we were not masters of the situation, the task would simply have been too great for us. I will not deny that we might have been more active in some questions. But our lack of strength on the one side, and the tremendous apparatus of the Amsterdamers on the other, makes it hard for us to undertake any action: there have been many cases when we have prevented a foolish action on the part of some impatient comrade only with difficulty. At a time when class differences have become so great, when our problems are so difficult, it is inadvisable to undertake any action tor which the working class is unprepared. To gain influence over the working class we must possess a well organized apparatus, and not only that, but also the confidence of the large masses of the working class in our communist policy. I believe that I can say in the name of the Party that we will be letter prepared lor a fight in the next month because our Party is gaining the confidence of ever larger masses of the proletariat. The Party can undertake greater actions now, because it has the broad masses which sympathise with it, and possesses an apparatus capable of leading a movement. But we can offer no panacea. I wish to underline what Comrade Lozovsky said this morning, for every country we need a Trade Union programme which corresponds with the peculiar conditions of that country; we must state our task clearly so that the masses will understand us. We also need a different policy for every industrial group, often for every union, and if Comrade Carr allows, I will take two more minutes to explain this. In Germany, for instance, we can organize the building trades for action. When we control a whole section, we can defeat the employers who are not yet strongly entrenched, not yet organized all over the country; the situation is quite different among the railroad workers. There are over a million workers among the railroad employers. But we are opposed by all the powers of the State. It has created laws to suppress the workers. We could tell the Building Trade workers: Break off with Päplow; we will build our own organization and fight the employers for better conditions. If we attempt the same with the railways, we will surely be defeated because we shall be opposed by the whole power of the State. The State can defeat us and throw all the revolution elements at once out of employment. In this way, we lost almost 2,000 of our best comrades last year. And just as we require different tactics for the building workers than for the railroad workers, so we require different methods for the other organizations. Among the metal workers, for instance, we have progressed so far, that the Dissmanites do not dare any longer to expel us as a body, because we posses almost half the membership and the opposition would be too great. Among the agricultural workers, we do not know the policy of the Amsterdamers. It seems as if we should proceed with the formation of a new organization, because we cannot tolerate that the gulf be widened. In closing my speech, allow me to make the following recommendations: First, that all Communist Parties must proceed to the creation of cells and carry out the decisions of the Second and Third World Congresses; second, to create a program of action for every group of industry which will permit us conduct our struggle as the circumstances require; third, to forbid our comrades, in the various revolutionary organizations or in dual Trade Union organizations, to fight each other and thereby afford great joy to our enemies.

third, to forbid our comrades, in the various revolutionary organizations or in dual Trade Union organizations, to fight each other and thereby afford great joy to our enemies. Top of the page Last updated on 2 January 2021

MIA > Archive > Fritz Heckert Fritz Heckert The Labor Movement The Union Congress at Essen (7 October 1922) From International Press Correspondence, Vol. 2 No. 89, 17 October 1922, pp. 673–674. Transcribed & marked up by Einde O’Callaghan for the Marxists’ Internet Archive. Public Domain: Marxists Internet Archive (2020). You may freely copy, distribute, display and perform this work; as well as make derivative and commercial works. Please credit “Marxists Internet Archive” as your source. The Union of Hand and Brain Workers of Germany convened its 2nd congress at Essen from the 1st to 5th October, in order to consider the work accomplished in the past year and to define its attitude to the tasks which as a revolutionary workers’ movement are to be fulfilled by it in the coming months. The congress was an exceedingly instructive one, for it showed that the workers of this organization have learnt much since their first congress in Halle in the year 1921, and that they are minded to draw the necessary conclusions from these lessons. At the first congress of the R.I.L.U. the representatives of the unions now united in the Union of Hand and Brain Workers adopted a position which was sharply in opposition to the principles and the tactics of the R.I.L.U. The first congress of the R.I.L.U. was thus compelled to submit some questions to the members of the Union at their congress in Halle to which clear, unequivocal replies were demanded. The Union had to decide whether it would work on the basis of the decisions reached at the first world congress of the R.I.L.U. in Moscow in order thereby to become affiliated to the R.I.L.U., or to reject the principles and decisions of the first world congress and place itself outside this world union of the revolutionary proletariat. The Halle congress disavowed the attitude of the Union’s delegates at the Moscow congress and declared in favor of affiliation to the R.I.L.U. The resolution however, in which this declaration was embodied did not signify unconditional acceptance of the conditions, but was in its content a concession to the syndicalist and federalist tendencies prevalent in the union. The ambiguous character of the resolution rendered it possible for a number of members of the Union, in the course of the following months to undertake to correct the decisions of the first world congress and to aver again and again that the principles and tactics of the R.I.L.U. did not correspond to the experiences and necessities of the class struggle; that a correction of the decisions of the first world congress in the direction of the opinions represented by the Union delegates at this congress, must be undertaken at the 2nd world congress, otherwise the union would have no interest in membership of the R.I.L.U. This attitude of a number of comrades in the Union led to continuous differences with the comrades of the German trade union opposition, and instead of dose cooperation-between the Union and the latter there were often lively disputes injurious to their common aims. The second congress of the Union at Essen, therefore had to test whether the majority of the members would call for a re-examination of the decisions reached in Halle, or whether, from the experiences won in practical struggle, they had drawn the knowledge to set aside the deficiencies of the organization, and to make out of the union a trade union, which, standing entirely on the basis of the R.I.L.U., shall strive firmly and steadfastly side by side with the trade union opposition for the common objective. The congress has made this thing clear and it can be joyfully recorded that the result of the congress means an essential step forward compared with the previous conditions in the Union. The chief differences still alive in the Union were: 1. The attitude towards the individual struggles of trade unions. 2. The question whether the union shall be a universal organization embracing workers of all categories and conducting not only the economic, but also the political struggle. 3. In what relation the Union shall stand to the reformist unions and their actions. 4. The question of the structure of the organization, the nature of the contributions and of the fighting fund of the Union. 5. The relation of the Union to the opposition within the old trade unions. In order that these questions should not be passed over, the Executive Committee of the R.I.L.U. wrote a letter to the congress of the Union of Hand and Brain Workers, in which it dealt exhaustively with these disputed questions and required from the congress that it should plainly and clearly define its attitude upon these points. Many an old unionist disliked the idea that it should so formulate its opinions that they could be taken as a dear avowal either for or against the principles of the R.I.L.U. The spirit, however, which dominated the overwhelming majority of the congress delegates, was, under all circumstances, to create clarity and under no circumstances to break connections with the R.I.L.U. They desired nothing more eagerly than the consolidation of the organization and the setting up of good relations for united activity with the trade union opposition. It was therefore easy to submit all problems to the congress and to formulate dear answers to these questions. The representative of the Communist Party, whose remarks were followed with the greatest attention, was therefore able to expound io the congress what deficiencies were to be noted in the tactics of the Union and in the structure of the organization, in what way these were to be removed, the Union itself rendered more fit for the struggle, and friendly and comradely relations established with the trade union opposition. On the first item of the agenda an attitude was adopted towards the trade union situation and to the tasks of the union in the revolutionary movement of the proletariat Upon these questions it was unanimously agreed that every attempt to separate the political from the economic struggle of the worker means a weakening of the working class and is counter revolutionary; that the proletariat must strive to concentrate its fight against the well-organized bourgeoisie, and that only the concentrated class power of the proletariat is capable of overcoming the bourgeoisie.

From this standpoint the Union declared that political neutrality is not permissible for a revolutionary worker, that the union should therefore support every revolutionary action and shall take active put in the struggle for the realization of all demands in the interests of the workers. The Union declared that its immediate and most pressing tasks were: the building up and extension of its organization, based upon workshop organizations according to the branch of industry and economic area; increased struggle against indifference; the publication of clearly written revolutionary trade union literature; the formation of a strong fighting fund; support of the revolutionary opposition in the Amsterdam unions; struggle against the policy of cooperation with the employers; increasing of real wages; defence of the eight hour day; extension of the rights of the workshop councils; struggle against high prices, and for the control of production, etc. Another resolution determined the relationship between the party and the union, and a sharp distinction was made against the syndicalist and anarchist elements. This resolution declares: that the proletarian class struggle has an international character and that international action can only be carried out provided there is international discipline, Autonomy of individual organizations or countries within an International means the bankruptcy of every workers’ movement; this is proved by the yellow Amsterdam international. In a revolutionary trade union organization the struggle must be conducted without regard to the interests of the capitalists. It can only be carried out successfully in connection with the revolutionary political organization of the proletariat The conquest of political power, i.e., the dictatorship of the proletariat, is the prerequisite for the final victory of the proletariat in the fight for its emancipation from economic slavery. The Union recognized that the Communist Party points out the aim in this struggle and that it must take the lead in the whole struggle for the achievement of this aim. It therefore becomes necessary to establish close contact between the revolutionary trade unions and the Communist Party. The Union expressly declares it to be its duty as a member of the Red international of Labor Unions, 1. to subordinate itself to international discipline, 2. to carry out the congress decisions of the R.I.L.U. and 3. to proceed unitedly in all actions with the revolutionary organizations as well as with the Communist Party. In order to render possible and to facilitate this common action, the union proposes the formation of Revolutionary Workers’ Committees of all revolutionary proletarian organizations throughout the country. The purpose of these revolutionary committees shall be to take a stand on all economic and political questions which interest the proletariat, and to establish close contact between these organizations. An attempt is made in the newly drawn-up statute to create an organizatory basis corresponding to the decisions of the congress relating to principles and tactics which will facilitate the fulfilment of the tasks laid down. In future the Union will organize the workers affiliated to it into industrial groups according to the principle of one industry, one union. The industrial groups retain the right of independent management, conducting of wage struggles, conclusion of collective agreements and establishing of international connections. In order to simplify the managing apparatus, a unified system of contributions will be introduced for industrial groups. In order to conduct struggles unitedly and energetically a central fighting fund will be created. It must be noted that the overwhelming majority of the congress recognized that the future tasks of the organization can only be fulfilled provided the members make greater financial sacrifices. The minimum weekly contribution was therefore fixed at the amount of half an hours wages. At the conclusion of the congress, the chairman summarized the results of the congress and said among other things: “We recognize the decisions of the R.I.L.U. upon the tactics of revolutionizing the trade unions as binding for us. We shall offer the most determined struggle against all reformist and anarcho-syndicalist tendencies. We will support the revolutionary opposition in the reformist trade unions in their hard struggle with all our power, and shall establish fraternal relationships with them.” All the decisions of the congress were essentially influenced by the intensive work of the representative of the Red International of Labor Unious which was gratefully welcomed by the delegates. Through its assistance in clearing up many questions of the proletarian class struggle and by its assistance in the improvement of the management of the organization the Red International of Labor Unions has shown itself as an organization adequate for the international revolutionary tasks. In six days of strenuous labor an enormous amount of work was accomplished and it can be recorded with joy that the delegates present at the congress fulfilled the duties entrusted to them with close attention and admirable devotion. This cannot be said of most of the trade union conferences which have taken place this year in Germany. The results of the congress are a great advance compared with the results of the congress at Halle. The experience of the 12 months which separate the two congresses have shown to the Union that many old views must, in the interest of the revolutionary movement, be thrown overboard, and that it is necessary to root out relentlessly all failings in the organisation. The congress at Essen has rendered the Union capable of carrying out the greater tasks of the coming months. Top of the page Last updated on 2 January 2021

MIA > Archive > Fritz Heckert Fritz Heckert Communist Recruiting Week The Aims of Recruiting Week (1 November 1921) From International Press Correspondence, Vol. I No. 4, 1 November 1921, pp. 33–34. Transcribed & marked up by Einde O’Callaghan for the Marxists’ Internet Archive. Public Domain: Marxists Internet Archive (2019). You may freely copy, distribute, display and perform this work; as well as make derivative and commercial works. Please credit “Marxists Internet Archive” as your source. With the motto “Go to the Masses’, the Communist International summons all its members to agitate during the week of November 3rd–10th among the great masses of the urban and rural proletariat, as yet unresponsive to Communism, and to rouse them to the struggle for freedom. The Communist International is undertaking for the first time a general mobilization throughout the world, wherever proletarians are groaning under the heel of the oppressor. The workers are becoming more and more disillusioned concerning the “glorious times promised to them in the large capitalist countries in return for their participation in the World-War adventure. The policy of the capitalist class has resulted in an overwhelming wave of unemployment, a staggering rise in the cost of living and an imperilling of the worker’s existence. If the workers try to resist, if they try to organize in self-defense, if they attempt to use the strike as a weapon, if they gather in demonstrations, the bestial bourgeoisie uses every means to strike them down, and calls this assassination “Protection of Rights’ and “Establishment of Order”. Influential labour-leaders have not only supported these measures of the bourgeoisie, but in many countries they alone have made them possible. During our Recruiting Week we must demonstrate to the workers that the continuation of capitalism, which they have tolerated until now, can only result in the ruin of the working class and of the economic life of the world. Our Recruiting Week, therefore, cannot he likened to the Recruiting Weeks of the Social Democratic Parties, which are only organized to win party-members or readers for their organs. We will also do everything possible to gain new members for the Communist partis and to increase the number of subscribers to the Communist periodicals. A party organization strong in members and a widely-spread communist press are necessary for the victory of the proletariat. The increasing of the membership cannot create, however, what the Recruiting Week should bring about. The composition of the Communist Party must be altogether different in quality from that of the Socialist Parties. The Communist Parties are parties of action, their members must at all hours be ready to make the greatest sacrifice for the cause of the proletariat ... We can say therefore, that our Recruiting Week depends especially on the spiritual contact of the Party with the large proletarian masses and also on the convincing of the workers remaining outside of the Party that the Communist International is their true leader. Keeping in mind the principal aim of Communism, our propagandists must come in close contact with the masses, and in connection with the daily struggles and needs of the workers show them the way leading out of capitalist slavery into freedom. The struggle for the final aim of Communism is only organized during the general struggle against life’s daily troubles. The spiritually backward proletarian is unable to realize that the struggle to free himself from these troubles leads to the overthrow of capitalism and the setting up of lhe dictatorship of the proletariat. To the ordinary workers reared in the oppressive capitalist system and lacking political opinions, the Communist aim seems so enormous that he cannot grasp it. and considers it unattainable and therefore utopian. The worker will learn to fight implacably for the Communist aim only when he realizes that, in the struggle for his existence, minor reforms cannot free him, and that he must give a larger form to the struggle for the freeing of the workers, and must use more effective means. The purpose of the Communist Party is to lead the workers in these unavoidable struggles in such a way that they will more easily find their way and suffer less defeat. In the Recruiting Week when we speak at meetings, when we peak with our colleagues, when we go from house to agitate, when we write in the periodicals, we will tell our suffering and oppressed class comrades what to do to succeed in the struggle against the doubles and needs of every day. This is not difficult. In the last few weeks the world economic crisis has become more acute in all countries, and has brought untold suffering to the working class. The world economic crisis appears under various aspects in different countries. In one country it has been an increase of unemployment, in another the tremendous rise in the cost of living, or both. The capitalist are trying to throw the burden of this world crisis on the working men. It is easy to make this clear to the workers. When capitalist production does not bring sufficient profit, the capitalist uses every means to guard himself against loss. He throws the workers pitilessly out into the street. He raises the cost of living. He beats down salaries, and for this purpose he creates lock outs, mobilizes strike-breakers and organizes White-Guard bands whom he permits to murder working men and to destroy workers’ enterprises in order to intimidate the workers. The capitalist seeks to increase the hours of work or the efficiency of labor, in case wages remain the same. Protection for the workers is made impossible. The most indispensable articles are raised in price, the production of goods which do not bring big profits is stopped. We see this best in the failure to relieve the shortage in dwellings. Housing accommodations for the lower classes are neglected. Hospitals and nurseries are closed. Invalids, pensioners, and cripples are abandoned. Through the most subtle systems of taxation a considerable part of the workman’s income is stolen. In order to carry this out more easily the capitalist buys the periodicals, the newspapers, controls literary production and employs thousands of agitators to influence the workers in a manner favourable to his own interests.

The capitalist strives to demoralize and to destroy the workers’ organizations, especially the labor unions. With a subtle system of swindle and lies capitalism tries to eliminate these organizations from the struggle against it. When it does not succeed in this, it tries to destroy them by means of force. Labor leaders are bought by the capitalist, an army of spies is suborned among the working class. Through special favours to single working men or groups of workers it is sought to split up the working masses. Those who are working are incited against the unemployed and vice versa. All these things can serve well in teaching the workmen. The majority of our class comrades do not understand the relation between these things. They live through the troubles of their time, helpless; they feel as if they are astray in a primeval forest. Their perception is often warped by the organizations on whose protection they depend. This does not necessarily happen because of the malice of the leaders of these organizations. It takes place naturally because most of the unions do not grasp the situation or because they are frightened by the enormity of the task. Our agitators must bear this situation in mind. They must therefore not try to blame all these faults of the labor organizations on the criminal leadership of these organizations. The faith of the working men in the justice of communism will not be strengthened through an continual nagging of the workers about their troubles and their bad leadership, but rather through our armor-plated argument, through our good advice, through the intelligent proposals we suggest to them to help them in their need, in our readiness to fight at the head of the workers even in the most insignificant struggles against daily suffering. The Recruiting Week must also give us a better conception of the psychology of the workers. We must learn the ways they react to the troubles which press upon them. We must be able to judge the value of their arguments against our doctrines and our tactics. We must learn to find the cardinal point in the working man’s soul, and in his understanding, in order to raise him from his lethargy and to turn him from an unfeeling follower or even an enemy into an active, energetic element in the proletarian class struggle. The results of our Recruiting Week need not show themselves in an immediate increase in the party membership or of subscribers of our periodicals. They must show themselves in the spirit which animates the workers in their struggles, and their reaction toward the Communist watch-words and to the directing of the struggle by our party. If there are no such results that will prove that our Party has not worked well. Will that show the deficiency of the Party itself and not the backwardness of the masses? The Recruiting Week will be the acid test of the ability of our organization, after a unified campaign, on an national and international scale, to interest the workmen in Communism and to mobilize them for the class struggle. The deficiencies in the organization which will be noted during the Recruiting Week or when the results are measured, must be removed. Every member of the Party has not only the opportunity but also the duty to show during Recruiting Week that he has fully earned the title of Communist. Everyone must help according to his ability, and everyone can help in the great work. In the Recruiting Week not only our own Party but the members of other workers’ parties can see whether we differ from the others only in revolutionary phrases or in purposeful work. Whoever impairs the success of Recruiting Week through idleness or bad propaganda harms this work not only immediately but permanently, because a failure of Recruiting Week will be a triumph to our opponents and will make our approach to the masses more difficult in the future. The aim of our Recruiting Week is limited; We must try not only to attain this goal but to surpass it. Every man to his post. Top of the page Last updated on 9 January 2019

Socialism in Africa Biography : Julius Kambarage Nyerere Transcribed by: Ayanda Madyibi. One of Africa’s most respected figures, Julius Nyerere (1922 — 1999) was a politician of principle and intelligence. Known as Mwalimu or teacher he had a vision of education that was rich with possibility Julius Kambarage Nyerere was born on April 13, 1922 in Butiama, on the eastern shore of lake Victoria in north west Tanganyika. His father was the chief of the small Zanaki tribe. He was 12 before he started school (he had to walk 26 miles to Musoma to do so). Later, he transferred for his secondary education to the Tabora Government Secondary School. His intelligence was quickly recognized by the Roman Catholic fathers who taught him. He went on, with their help, to train as a teacher at Makerere University in Kampala (Uganda). On gaining his Certificate, he taught for three years and then went on a government scholarship to study history and political economy for his Master of Arts at the University of Edinburgh (he was the first Tanzanian to study at a British university and only the second to gain a university degree outside Africa. In Edinburgh, partly through his encounter with Fabian thinking, Nyerere began to develop his particular vision of connecting socialism with African communal living. On his return to Tanganyika, Nyerere was forced by the colonial authorities to make a choice between his political activities and his teaching. He was reported as saying that he was a schoolmaster by choice and a politician by accident. Working to bring a number of different nationalist factions into one grouping he achieved this in 1954 with the formation of TANU (the Tanganyika African National Union). He became President of the Union (a post he held until 1977), entered the Legislative Council in 1958 and became chief minister in 1960. A year later Tanganyika was granted internal self-government and Nyerere became premier. Full independence came in December 1961 and he was elected President in 1962. Nyerere’s integrity, ability as a political orator and organizer, and readiness to work with different groupings was a significant factor in independence being achieved without bloodshed. In this he was helped by the co-operative attitude of the last British governor — Sir Richard Turnbull. In 1964, following a coup in Zanzibar (and an attempted coup in Tanganyika itself) Nyerere negotiated with the new leaders in Zanzibar and agreed to absorb them into the union government. The result was the creation of the Republic of Tanzania. Ujamma, socialism and self reliance As President, Nyerere had to steer a difficult course. By the late 1960s Tanzania was one of the world’s poorest countries. Like many others it was suffering from a severe foreign debt burden, a decrease in foreign aid, and a fall in the price of commodities. His solution, the collectivization of agriculture, villigization (see Ujamma below) and large-scale nationalization was a unique blend of socialism and communal life. The vision was set out in the Arusha Declaration of 1967 (reprinted in Nyerere 1968): "The objective of socialism in the United Republic of Tanzania is to build a society in which all members have equal rights and equal opportunities; in which all can live in peace with their neighbours without suffering or imposing injustice, being exploited, or exploiting; and in which all have a gradually increasing basic level of material welfare before any individual lives in luxury." (Nyerere 1968: 340) The focus, given the nature of Tanzanian society, was on rural development. People were encouraged (sometimes forced) to live and work on a co-operative basis in organized villages or ujamaa (meaning ‘familyhood’ in Kishwahili). The idea was to extend traditional values and responsibilities around kinship to Tanzania as a whole. Within the Declaration there was a commitment to raising basic living standards (and an opposition to conspicuous consumption and large private wealth). The socialism he believed in was ‘people-centred’. Humanness in its fullest sense rather than wealth creation must come first. Societies become better places through the development of people rather than the gearing up of production. This was a matter that Nyerere took to be important both in political and private terms. Unlike many other politicians, he did not amass a large fortune through exploiting his position. The policy met with significant political resistance (especially when people were forced into rural communes) and little economic success. Nearly 10 million peasants were moved and many were effectively forced to give up their land. The idea of collective farming was less than attractive to many peasants. A large number found themselves worse off. Productivity went down. However, the focus on human development and self-reliance did bring some success in other areas notably in health, education and in political identity. Liberation struggles A committed pan-Africanist, Nyerere provided a home for a number of African liberation movements including the African National Congress (ANC) and the Pan African Congress (PAC) of South Africa, Frelimo when seeking to overthrow Portuguese rule in Mozambique, Zanla (and Robert Mugabe) in their struggle to unseat the white regime in Southern Rhodesia (now Zimbabwe). He also opposed the brutal regime of Idi Amin in Uganda. Following a border invasion by Amin in 1978, a 20,000-strong Tanzanian army along with rebel groups, invaded Uganda. It took the capital, Kampala, in 1979, restoring Uganda’s first President, Milton Obote, to power. The battle against Amin was expensive and placed a strain on government finances. There was considerable criticism within Tanzania that he had both overlooked domestic issues and had not paid proper attention to internal human rights abuses. Tanzania was a one party state — and while there was a strong democratic element in organization and a concern for consensus, this did not stop Nyerere using the Preventive Detention Act to imprison opponents. In part this may have been justified by the need to contain divisiveness, but there does appear to have been a disjuncture between his commitment to human rights on the world stage, and his actions at home. Retirement In 1985 Nyerere gave up the Presidency but remained as chair of the Party - Chama Cha Mapinduzi (CCM). He gradually withdrew from active politics, retiring to his farm in Butiama. In 1990 he relinquished his chairmanship of CCM but remained active on the world stage as Chair of the Intergovernmental South Centre. One of his last high profile actions was as the chief mediator in the Burundi conflict (in 1996). He died in a London hospital of leukaemia on October 14, 1999. Books and Articles by Julius Nyerere: Good Governance for Africa (1998) Marxism in Africa

5 February 1967 The Arusha Declaration Written: for Tanganyika African National Union by Julius Nyerere, 1967; Transcribed by: Ayanda Madyibi. The Declaration was discussed and then published in Swahili. This revised English Translation clarifies ambiguities which existed in the translation originally issued. The Arusha Declaration and TANU’s Policy on Socialism and Self-Reliance PART ONE The TANU Creed The policy of TANU is to build a socialist state. The principles of socialism are laid down in the TANU Constitution and they are as follows: WHEREAS TANU believes: (a) That all human beings are equal; (b) That every individual has a right to dignity and respect; (c) That every citizen is an integral part of the nation and has the right to take an equal part in Government at local, regional and national level; (d) That every citizen has the right to freedom of expression, of movement, of religious belief and of association within the context of the law; (e) That every individual has the right to receive from society protection of his life and of property held according to law; (f) That every individual has the right to receive a just return for his labour; (g) That all citizens together possess all the natural resources of the country in trust for their descendants; (h) That in order to ensure economic justice the state must have effective control over the principal means of production; and (i) That it is the responsibility of the state to intervene actively in the economic life of the nation so as to ensure the well-being of all citizens, and so as to prevent the exploitation of one person by another or one group by another, and so as to prevent the accumulation of wealth to an extent which is inconsistent with the existence of a classless society. NOW, THEREFORE, the principal aims and objects of TANU shall be as follows: (a) To consolidate and maintain the independence of this country and the freedom of its people; (b) To safeguard the inherent dignity of the individual in accordance with the Universal Declaration of Human Rights; (c) To ensure that this country shall be governed by a democratic socialist government of the people; (d) To co-operate with all political parties in Africa engaged in the liberation of all Africa; (e) To see that the Government mobilizes all the resources of this country towards the elimination of poverty, ignorance and disease; (f) To see that the Government actively assists in the formation and maintenance of co-operative organizations; (g) to see that wherever possible the Government itself directly participates in the economic development of this country; (h) To see that the Government gives equal opportunity to all men and women irrespective of race, religion or status; (i) To see that the Government eradicates all types of exploitation, intimidation, discrimination, bribery and corruption; (j) To see that the Government exercises effective control over the principal means of production and pursues policies which facilitate the way to collective ownership of the resources of this country; (k) To see that the Government co-operates with other states in Africa in bringing about African unity; (l) To see that Government works tirelessly towards world peace and security through the United Nations Organization. PART TWO The Policy of Socialism (a) Absence of Exploitation A truly. socialist state is one in which all people are workers and in which neither capitalism nor feudalism exists. It does not have two classes of people, a lower class composed of people who work for their living, and an upper class of people who live on the work of others. In a really socialist country no person exploits another; everyone who is physically able to work does so; every worker obtains a just return for the labour he performs; and the incomes derived from different types of work are not grossly divergent. In a socialist country, the only people who live on the work of others, and who have the right to be dependent upon their fellows, are small children, people who are too old to support themselves, the crippled, and those whom the state at any one time cannot provide with an opportunity to work for their living. Tanzania is a nation of peasants but is not yet a socialist society. It still contains elements of feudalism and capitalism--with their temptations. These feudalistic and capitalistic features of our society could spread and entrench themselves. (b) The Major Means of Production and Exchange are under the Control of the Peasants and Workers. To Build and maintain socialism it is essential that all the major means of production and exchange in the nation are controlled and owned by the peasants through the machinery of their Government and their co-operatives. Further, it is essential that the ruling Party should be a Party of peasants and workers. The major means of production and exchange are such things as: land; forests; minerals;water; oil and electricity; news media; communications; banks, insurance, import ;and export trade, wholesale trade ; iron and steel, machine tool, arms, motor-car, cement, fertilizer, and textile industries; and any big factory on which a large section of the people depend for their living, or which provides essential components of other industries; large plantations, and especially those which provide raw materials essential to important industries. Some of the instruments of production and exchange which have been listed here are already owned or controlled by the people’s Government of Tanzania. (c) The Existence of Democracy A state is not socialist simply because its means of production and exchange are controlled or owned by the government, either wholly or in large part. If a country to be socialist, it is essential that its government is chosen and led by the peasants and workers themsclvcs. If the minority governments of Rhodesia or South Africa controlled or owned the entire economies of these respective countries, the result would be a strengthening of oppression, not the building of socialism. True socialism cannot exist without democracy also existing in the society. (d) Socialism is a Belief Socialism is a way of life, and a socialist society cannot simply come into existence. A socialist society can only be built by those who believe in, and who themselves practice, the principles of socialism.

A socialist society can only be built by those who believe in, and who themselves practice, the principles of socialism. A committed member of TANU will be a socialist, and his fellow socialist – that is, his fellow believers in this political and economic system – are all those in Africa or elsewhere in the world who fight for the rights of peasants and workers. The first duty of a TANU member, and especially of a TANU leader, is to accept these socialist principles, and to live his own life in accordance with them. In particular, a genuine TANU leader will not live off the sweat of another man, nor commit any feudalistic or capitalistic actions. The successful implementation of .socialist objectives depends very much up the leaders, because socialism is a belief in a particular system of living, and it is difficult for leaders to promote its growth if they do not themselves accept it. PART THREE The Policy of Self-Reliance We are at War TANU is involved in a war against poverty and oppression in our country; the struggle is aimed at moving the people of Tanzania (and the people of Africa as a whole) from a state of poverty to a State of prosperity. We have been oppressed a great deal, we have been exploited a great deal and we have been disregarded a great deal. It is our weakness that has led to our being oppressed, exploited and disregarded. Now we want a revolution – a revolution which brings an end to our weakness, so that we are never again exploited, oppressed, or humiliated. A Poor Man does not use Money as a Weapon But it is obvious that in the past we have chosen the wrong weapon for our struggle, because we chose money as our weapon. We are trying to overcome our economic weakness by using the weapons or the economically strong – weapons which in fact we do not possess. By our thoughts, words and actions it appears as if we have come to the conclusion that without money we cannot bring about the revolution we are aiming at. It is as if we have said, ‘Money is the basis of development. Without money there can be no development.’ That is what we believe at present. TANU leaders, and Government leaders and officials, all put great emphasis and dependence on money. The people’s leaders, and the people themselves, in TANU, NUTA, Parliament, UWT, the co-operatives, TAPA, and in other national institutions think, hope and pray for MONEY. It is as if we had all agreed to speak with one voice, saying, ‘If we get money we shall develop, without money we cannot develop. In brief, our Five-Year Development Plan aims at more food, more education, and better health; but the weapon we have put emphasis upon is money. It is as if we said, ‘In the next five years we want to have more food, more education, and better health, and in order to achieve these things we shall spend �250,000,000’. We think and speak as if the most important thing to depend upon is MONEY and anything else we intend to use in our struggle is of minor importance. When a member of Parliament says that there is a shortage of water in his constituency ; and he asks the Government how it intends to deal with the problem, he expects the Government to reply that it is planning to remove the shortage of water in his constituency – with MONEY. When another Member of Parliament asks what the Government is doing about the shortage of roads, schools or hospitals in his constituency, he also expects the Government to tell him that it has specific plans to build roads, schools and hospitals in his constituency – with MONEY. When a NUTA official asks the Government about its plans to deal with the low wages and poor housing of the workers, he expects the Government to inform him that the minimum wage will be increased and that better houses will be provided for the workers – WITH MONEY. When a TAPA official asks the Government what plans it has to give assistance to the many TAPA schools which do not get Government aid, he expects the Government to state that it is ready the following morning to give the required assistance – WITH MONEY. When an official of the co-operative movement mentions any problem facing the farmer, he expects to hear that the Government will solve the farmer’s problems – WITH MONEY in short, for every problem facing our nation, the solution that is in everybody’s mind is MONEY. Each year, each Ministry of Government makes its estimates of expenditure, i.e. the amount of money it will require in the coming year to meet recurrent and development expenses. Only one Minister and his Ministry make estimates of revenue. This is the Minister for Finance. Every Ministry puts forward very good development plans. When the Ministry presents its estimates, it believes that the money is there for the asking but that the Minister for Finance are being obstructive. And regularly each year the Minister of Finance has to tell his fellow Ministers that there is no money. And each year the Ministers complain about the Ministry of Finance when it trims down their estimates. Similarly, when Members of Parliament and other leaders demand that the Government should carry out a certain development, they believe that there is a lot of money to spend on such projects, but that the Government is the stumbling block. Yet such belief on the part of Ministries, Members of Parliament and other leaders does not alter the stark truth, which is that Government has no money. When it is said that Government has no money, what does this mean? It means that the people of Tanzania have insufficient money The people pay taxes out of the very little wealth they have; it is from these taxes that the Government meets its recurrent and development expenditure. When we call on the Government to spend more money on development projects, we are asking the Government to use more money. and if the Government does not have any more, the only way it can do this is to increase its revenue through extra taxation. If one calls on the Government to spend more, one is in effect calling on the Government to increase taxes. Calling on the Government to spend more without raising taxes is like demanding that the Government should perform miracles; it is equivalent to asking for more milk from a cow while insisting that the cow should not be milked again. But our refusal to admit the calling on the Government to spend more is the same as calling on the Government to raise taxes shows that we fully realize the difficulties of increasing taxes.

We realize that the cow has no more milk – that is, that the people find it difficult to pay more taxes. We know that the cow would like to have more milk herself, so that her calves could drink it, or that she would like more milk which could be sold to provide more comfort for herself or her calves. But knowing all the things which could be done with more milk does not alter the fact that the cow has no more milk! WHAT OF EXTERNAL AID? One method we use to try and avoid a recognition of the need to increase taxes if we want to have more money for development, is to think in terms of getting the extra money from outside Tanzania. Such external finance falls into three main categories. (a) Gifts: This means that another government gives our Government a sum of money as a free gift for a particular development scheme. Sometimes it may be that an institution in another country gives our Government, or an institution in our country, financial help for development programmes. (b) Loans: The greater portion of financial help we expect to get from outside is not in the form of gifts or charity, but in the form of loans. A foreign government or a foreign institution, such as a bank, lends our Government money for the purposes of development. Such a loan has repayment conditions attached to it, covering such factors as the time period for which it is available and the rate of interest. (c) Private Investment: The third category of financial help is also greater than the first. This takes the form of investment in our country by individuals or companies from outside. The important condition which such private investors have in mind is that the enterprise into which they put their money should bring them profit and that our Government should permit them to repatriate these profits. They also prefer to invest in a country whose policies they agree with and which will safeguard their economic interests. These three are the main categories of external finance. And there is in Tanzania a fantastic amount of talk about getting money from outside. Our Government, and different groups of our leaders, never stop thinking about methods of getting finance from abroad. And if we get some money or even if we just get a promise of it, our newspapers, our radio, and our leaders, all advertise the fact in order that every person shall know that salvation is coming, or is on the way. If we receive a girt we announce it, if we receive a loan we announce it, if we get a new factory we announce it – and always loudly. In the same way, when we get a promise of a gift, a loan, or a new industry, we make an announcement of the promise. Even when we have merely started discussions with a foreign government or institution for a gift, a loan, or a new industry, we make an announcement – even though we do not know the outcome of the discussions. Why do we do all this? Because we want people to know that we have started discussions which will bring prosperity. DO NOT LET US DEPEND UPON MONEY FOR DEVELOPMENT It is stupid to rely on money as the major instrument of development when we know only too well that our country is poor. It is equally stupid, indeed it is even more stupid, for us to imagine that we shall rid ourselves of our poverty through foreign financial assistance rather than our own financial resources. It is stupid for two reasons. Firstly, we shall not get the money. It is true that there are countries which can, and which would like to, help us. But there is no country in the world which is prepared to give us gifts or loans, or establish industries, to the extent that we would be able to achieve all our development targets. There are many needy countries in the world. And even if all the prosperous nations were willing to help the needy countries, the assistance would still not suffice. But in any case the prosperous nations have not accepted a responsibility to fight world poverty. Even within their own borders poverty still exists, and the rich individuals do not willingly give money to the government to help their poor fellow citizens. It is only through taxation, which people have to pay whether they want to or not, that money can be extracted from the rich in order to help the masses. Even then there would not be enough money. However heavily we taxed the citizens of Tanzania and the aliens living here, the resulting revenue would not be enough to meet the costs of the development we want. And there is no World Government which can tax the prosperous nations in order to help the poor nations; nor if one did exist could it raise enough revenue to do all that is needed in the world. But in fact, such a World Government does not exist. Such money as the rich nations offer to the poor nations is given voluntarily, either through their own goodness, or for their own benefit. All this means that it is impossible for Tanzania to obtain from overseas enough money to develop our economy. GIFTS AND LOANS WILL ENDANGER OUR INDEPENDENCE Secondly, even if it were possible for us to get enough money for our needs from external sources, is this what we really want? Independence means self-reliance. Independence cannot be real if a nation depends upon gifts and loans from another for Its development. Even if there was a nation, or nations, prepared to give us all the money we need for our development, it would be improper for us to accept such assistance without asking ourselves how this would effect our independence and our very survival as a nation. Gifts which increase, or act as a catalyst, to our own efforts are valuable. Gifts which could have the effect of weakening or distorting our own efforts should not be accepted until we have asked ourselves a number of questions. The same applies to loans. It is true that loans are better than ‘free’ gifts. A loan is intended to increase our efforts or make those fruitful. One condition of a loan is that you show how you are going to repay it. This means you have to show that you intend to use the loan profitably and will therefore be able to repay it. But even loans have their limitations. You have to give consideration to the ability to repay. When we borrow money from other countries it is the Tanzanian who pays it back. And as we have already stated, Tanzania’s are poor people.

And as we have already stated, Tanzania’s are poor people. To burden the people with big loans, the repayment of which will be beyond their means, is not to help them but to make them suffer. It is even worse when the loans they are asked to repay have not benefited the majority of the people but have only benefited a small minority. How about the enterprises of foreign investors ? It is true we need these enterprises. We have even passed an Act of Parliament protecting foreign investments in this country. Our aim is to make foreign investors feel that Tanzania is a good place in which to invest because investments would be safe and profitable, and the profits can be taken out of the country without difficulty. We expect to get money through this method. But we cannot get enough. And even if we were able to convince foreign investors and foreign firms to undertake all the projects and programmes of economic development that we need, is that what we actually want to happen ? Had we been able to attract investors from America and Europe to come and start all the industries and all the projects of economic development that we need in this country, could we do so without questioning ourselves? Could we agree to leave the economy of our country in the hands of foreigners who would take the profits back to their countries? Or supposing they did not insist upon taking their profits away, but decided to reinvest them in Tanzania; could we really accept this situation without asking ourselves what disadvantages our nation would suffer? Would this allow the socialism we have said it is our objective to build ? How can we depend upon gifts, loans, and investments from foreign countries and foreign companies without endangering our independence? The English people have a proverb which says, ‘He who pays the piper calls the tune’. How can we depend upon foreign governments and companies for the major part of our development without giving to those governments and countries a great part of our freedom to act as we please ? The truth is that we cannot. Let us repeat. We made a mistake in choosing money – something we do not have – to be the big instrument of our development. We are making a mistake to think that we shall get the money from other countries; first, because in fact we shall not be able to get sufficient money for our economic development; and secondly, because even if we could get all that we need, such dependence upon others would endanger our independence and our ability to choose our own political policies. WE HAVE PUT TOO MUCH EMPHASIS ON INDUSTRIES Because of our emphasis on money, we have made another big mistake. We have put too much emphasis on industries. Just as we have said , ‘Without money there can be no development’, we also seem to say, ‘Industries arc the basis of development, without industries there is no development’. This is true The day when we have lots of money we shall be able to say we are a developed country. We shall be able to say, When we began our development plans we did not have enough money and this situation made it difficult for us to develop as fast as we wanted. Today we are developed and we have enough money. That is to say, our money has been brought by development. Similarly, the day we become industrialized we shall be able to say we are developed. Development would have us to have industries. The mistake we are making is to think that development begins with industries. It is a mistake because we do not have the means to establish many modern industries in our country. We do not have either the necessary finances or the technical know-how. It is not enough to say that we shall borrow the finances and the technicians from other countries to come and start the industries. The answer to this is the same one we gave earlier, that we cannot get enough money and borrow enough technicians to start all the industries we need. And even if we could get the necessary assistance, dependence on it could interfere with our policy on socialism. The policy of inviting a chain of capitalists to come and establish industries in our country might succeed in giving us all the industries we need but it would also succeed in preventing the establishment of socialism unless we believe that without first building capitalism, we cannot build socialism. LET US PRAY AND HEED TO THE PEASANT Our emphasis on money and industries has made us concentrate on urban development. We recognize that we do not have enough money to bring the kind of development to each village which would benefit everybody. We also know that we cannot establish an industry in each village and through this means erect a rise in the real incomes of the people. For these reasons we spend most of our money in the urban areas and our industries are established in the towns. Yet the greater part of this money that we spend in the towns comes from loans. Whether it is use it to build schools, hospitals, houses or factories, etc., it still has to be repaid. But it is obvious that it cannot be repaid just out of money obtained from urban and industrial development. To repay the loans we have to use foreign currency which is obtained from the sale of our exports. But we do not now sell our industrial products in foreign markets, and indeed it is likely to be a long time before our industries produce for export. The main aim of our new industries is ‘import substitution’ – that is, to produce things which up to now we have had to import from foreign countries. It is therefore obvious that the foreign currency we shall use to pay back the loans used in the development Or the urban areas will not come from the towns or the industries. Where, then, shall we get it from? We shall get it from the villages and from agriculture. What does this mean? It means that the people who benefit directly from development which is brought about by borrowed money are not the ones who will repay the loans. The largest proportion of the loans will be spent in, or for, the urban areas, but the largest proportion of the repayment will be made through the efforts of the farmers. This fact should always be borne in mind, for there are various forms of exploitation.

This fact should always be borne in mind, for there are various forms of exploitation. We must not forget that people who live in towns can possibly become the exploiters of those who live in the rural areas. All our big hospitals are in towns and they benefit only a small section of the people of Tanzania. Yet if we had built them with loans from outside Tanzania, it is the overseas sale of the peasants’ produce which provides the foreign exchanges for repayment. Those who do not get the benefit of the hospital thus carry the major responsibility for paying for them. Tarmac roads, too, are mostly found in towns and are of especial value to the motor-car owners. Yet if we have built those roads with loans, it is again the farmer who produces the goods which will pay for them. What is more, the foreign exchange with which the car was bought also came from the sale of the farmers’ produce. Again, electric lights, water pipes, hotels and other aspects of modern development are mostly found in towns. Most of them have been built with loans, and most of them do not benefit the farmer directly, although they will be paid for by the foreign exchange earned by the sale of his produce. We should always bear this in mind. Although when we talk of exploitation we usually think of capitalists, we should not forget that there are many fish in the sea. They eat each other. The large ones eat the small ones, and small ones eat those who are even smaller. There are two possible ways of dividing the people in our country. We can put the capitalists and feudalists on one side, and the farmers and workers on the other. But we can also divide the people into urban dwellers on one side and those who live in the rural areas on the other. If we are not careful we might get to the position where the real exploitation in Tanzania is that of the town dwellers exploiting the peasants. THE PEOPLE AND AGRICULTURE The development of a country is brought about by people, not by money. Money, and the wealth it represents, is the result and not the basis of development. The four prerequisites of development are different; they are (i) People; (ii) Land; (iii) Good Policies; (iv) Good Leadership. Our country has more than ten million people1 and is are; is more than 362,000 square miles. AGRICULTURE IS THE BASIS OF DEVELOPMENT A great part of Tanzania’s land is fertile and gets sufficient rain. Our country can produce various crops for home consumption and for export. We can produce food crops (which can be exported if we produce in large quantities) such as maize, rice, wheat, beans, groundnuts, etc. And we can produce such cash crops as sisal, cotton, coffee, tobacco, pyrethrum, tea, etc. Our land is also good for grazing cattle, goats, sheep, and for raising chickens, etc.; we can get plenty of fish from our rivers, lakes, and from the sea. All of our farmers are in areas which can produce two or three or even more of the food and cash crops enumerated above, and each farmer could increase his production so as to get more food or more money. And because the main aim of development is to get more food, and more money for our other needs our purpose must be to increase production of these agricultural crops. This is in fact the only road through which we can develop our country – in other words, only by increasing our production of these things can we get more food and more money for every Tanzanian. THE CONDITIONS OF DEVELOPMENT (a) Hard Work Everybody wants development; but not everybody understands and accepts the basic requirements for development. The biggest requirement is hard work. Let us go to the villages and talk to our people and see whether or not it is possible for them to work harder. In towns, for example, wage-earners normally work for seven and a half or eight hours a day, and for six or six and a half days a week. This is about 45 hours a week for the whole year, except for two or three weeks leave. In other words, a wage-earner works for 45 hours a week for 48 or 50 weeks of the year. In or a country like ours these are really quite short working hours. In other countries, even those which are more developed than we are, people work for more than 45 hours a week. It is not normal for a young country to start with such a short working week. The normal thing is to begin with long working hours and decrease them as the country becomes more and more prosperous. By starting with such short working hours and asking for even shorter hours, we are in fact imitating the more developed countries. And we shall regret this imitation. Nevertheless, wage earners do work for 45 hours per week and their annual vacation does not exceed four weeks. It would be appropriate to ask our farmers, especially the men, how many hours a week and how many weeks a year they work. Many do not even work for half as many hours as the wage-earner does. The truth is that in the villages the women work very hard. At times they work for 12 or 14 hours a day. They even work on Sundays and public holidays. Women who live in the villages work harder than anybody else in Tanzania. But the men who live in villages (and some of the women in towns) are on leave for half of their lire.

But the men who live in villages (and some of the women in towns) are on leave for half of their lire. The energies of the millions of men in the villages and thousands of women in the towns which are at present wasted in gossip, dancing and drinking, are a great treasure which could contribute more towards the development of our country than anything we could get from rich nations. We would be doing something very beneficial to our country if we went to the villages and told our people that they hold this treasure and that it is up to them to use it for their own benefit and the benefit of our whole nation . (b) Intelligence The second condition of development is the use of intelligence. Unintelligent hard work would not bring the same good results as the two combined. Using a big hoe instead of a small one; using a plow pulled by oxen instead of an ordinary hoe; the use of fertilizers; the use of insecticides; knowing the right crop for a particular season or soil; choosing good seeds for planting; knowing the right time for planting, weeding, etc.; all these things show the use of knowledge and intelligence. And all of them combine with hard work to produce more and better results. The money and time we spend on passing this knowledge to the peasants are better spent and bring more benefits to our country than the money and great amount of time we spend on other things which we call development. These facts are well known to all of us. The parts of our Five-Year Development Plan which are on target, or where the target has been exceeded, are those parts which depend solely upon the people’s own hard work. The production of cotton, coffee, cashew nuts, tobacco and pyrethrum has increased enormously for the past three years. But these are things which are produced by hard work and the good leadership of the people, not by the use of great amounts of money. Furthermore the people, through their own hard work and with a little help and leadership, have finished many development projects in the villages. They have built schools, dispensaries, community centers, and roads; they have dug wells, water channels, animal dips, small dams, and completed various other development projects. Had they waited for money, they would not now have the use of these things. HARD WORK IS THE ROOT OF DEVELOPMENT Some Plan projects which depend on money are going on well, but there are many which have stopped and others which might never be fulfilled because of lack of money. Yet still we talk about money and our search for money increases and takes nearly all our energies. We should not lessen our efforts to get the money we really need, but it would be more appropriate for us to spend time in the villages showing the people how to bring about development through their own efforts rather than going on so many long and expensive journeys abroad in search of development money. This is the real way to bring development to everybody in the country. None of this means that from now on we will not need money or that we will not start industries or embark upon development projects which require money. Furthermore, we are not saying that we will not accept, or even that we shall not look for, money from other countries for our development. This is not what we are saying. We will continue to use money; and each year we will use more money for the various development projects than we uscd the previous year because this will be one of the signs of our development. What we are saying, however, is that from now on we shall know what is the foundation and what is the fruit of development. Between money and people it is obvious that the people and their hard work are the foundation of development, and money is one of the fruits of that hard work. From now on we shall stand upright and walk forward on our feet rather than look at this problem upside down. industries will come and money will come but their foundation is the people and their hard work, especially in AGRICULTURE. This is the meaning of self-reliance. Our emphasis should therefore be on: (a) The Land and Agriculture (b) The People (c) The Policy of Socialism and Self-Reliance, and (d) Good Leadership. (a) The Land Because the economy of Tanzania depends and will continue to depend on agriculture and animal husbandry, Tanzanians can live well without depending on help from outside if they use their land properly. Land is the basis of human life and all Tanzanians should use it as a valuable investment for future development. Because the land belongs to the nation, the Government has to see to it that it is being used for the benefit of the whole nation and not for the benefit of one individual or just a few people. It is the responsibility of TANU to see that the country produces enough food and enough cash crops for export. It is the responsibility of the Government and the co-operative societies to see to it that our people get the necessary tools, training and leadership in modern methods of agriculture. (b) The People In order properly to implement the policy of self-reliance, the people have to be taught the meaning of self-reliance and its practice. They must become self-sufficient in food, serviceable clothes and good housing. In our country work should be something to be proud of, and laziness, drunkenness and idleness should be things to be ashamed of. And for the defense of our nation, it is necessary for us to be on guard against internal stooges who could be used by external enemies who aim to destroy us. The people should always be ready to defend their nation when they are called upon to do so. (c) Good Policies The principles of our policy of self-reliance go hand in hand with our policy of socialism. In order to prevent exploitation it is necessary for everybody to work and to live on his own labour. And in order to distribute the national wealth rairly, it is necessary for everybody to work to the maximum of his ability. Nobody should go and stay for a long time with his relative, doing no work, because in doing so he will be exploiting his relative. Likewise, nobody should be allowed to loiter in towns or villages without doing work which would enable him to be self-reliant without exploiting his relatives. TANU believes that everybody who loves his nation has a duty to serve it by co-operating with his fellows in building the country for the benefit of all the people of Tanzania. In order to maintain our independence and our pcople’s freedom we ought to be self-reliant in every possible way and avoid depending upon other countries for assistance.

If every individual is self-reliant ten-house cell will be self-reliant; if all the cells are self-reliant the whole ward will be self-reliant; and if the wards are self-reliant the District will be self-reliant. If the Districts arc self-reliant, then the Region is self-reliant, and if the Regions are self-reliant, then the whole nation is self-reliant and this our aim. (d) Good Leadership TANU recognizes the urgency and importance of good leadership. But we have not yet produced systematic training for our leaders; it is necessary that TANU Headquarters should now prepare a programme of training for all leaders – from the national level to the ten-house cell level – so that every one of them understands our political and economic policies. Leaders must set a good example to the rest of the people in their lives and in all their activities. PART FOUR TANU Membership Since the Party was founded we have put great emphasis on getting as many members as possible. This was the right policy during the independence struggle. But now the National Executive feels that the time has come when we should put more emphasis on the beliefs of our Party and its policies of socialism. That part of the TANU Constitution which relates to the admission of a member should be adhered to, and if it is discovered that a man does not appear to accept the faith, the objects, and the rules and regulations of the Party, then he should not be accepted as a member. In particular, it should not be forgotten that TANU is a party of peasants and workers. PART FIVE The Arusha Resolution Therefore, the National Executive Committee, meeting in the Community Centre at Arusha from 26.1.67 to 29.1.67 resolves: (a) The Leadership 1. Every TANU and Government leader must be either a peasant or a worker, and should in no way be associated with the practices or capitalism or feudalism. 2. No TANU or Government leader should hold shares in any company. 3. No TAN U or Government leader should hold directorships in any privately owned enterprise. 4. No TANU or Government leader should receive two or more salaries. 5. No TANU or Government leader should own houses which he rents to others. 6. For the purposes of this Resolution the term ‘leader’ should comprise the following: Members of the TANU National Executive Committee; Ministers; Members of Parliament; senior officials of organizations affiliated to TANU; senior officers of par-statal organizations; all those appointed or elected under any clause of the TANU Constitution; councilors; and civil servants in the high and middle cadres. (In this context ‘leader’ means a man, or a man and his wife; a woman, or a woman and her husband.) (b) The Government and other Institutions 1. Congratulates the Government for the steps it has taken so far in the implementation of the policy of socialism 2. Calls upon the Government to take further steps in the implementation of our policy of socialism as described in Part Two of this document without waiting for a Commission on Socialism. 3. Calls upon the Government to put emphasis, when preparing its development plans, on the ability of this country to implement the plans rather than depending on foreign loans and grants as has been done in the current Five-Year Development Plan. The National Executive Committee also resolves that the Plan should be amended so as to make it fit in with the policy of self-reliance. 4. Calls upon the Government to take action designed to ensure that the incomes of workers in the private sector are not very different from the incomes of workers in the public sector. 5. Calls upon the Government to put great emphasis on actions which will raise the standard of living of the peasants, and the rural community. 6. Calls upon NUTA, the co-operatives, TAPA, UWT, TYL, and other Government institutions to take steps to implement the policy of socialism and self-reliance. (c) Membership Members should get thorough teaching on Party ideology so that they may understand it, and they should always be reminded of the importance of living up to its principles. Nyerere Archive

Marxism in Africa Good Governance for Africa By Julius Nyerere 13 October 1998 Written: by Julius Nyerere, 1998; Transcribed by: Ayanda Madyibi. Governance in Africa, says the Chairman of the South Commission, must be improved for the continent's countries and people to build real freedom and real development. However, his definition of good governance is different from the one used by the rich countries in meting out aid to poor nations. A few years ago, I attended a meeting of the Global Coalition for Africa (GCA) in Harare, Zimbabwe. It was chaired by the former President of Botswana, Masire, and attended by a substantial number of African Heads of State. From outside Africa, it was attended by the two Co-Chairmen of the GCA, Robert MacNamara from the United States and Ian Pronk from the Netherlands, and a large number of officials from the donor community. At a certain point in the course of the discussion, the question of good governance in Africa came up. But it came up as a condition of giving aid to African countries. The manner of the discussion and the fact that this was an exchange between African Heads of State and officials from rich countries made me livid with anger. Notion of the 'Deserving Poor' It reminded me of the social history of Great Britain before the advent of the welfare state. The extremes of individual or family poverty within that country were dealt with through the philanthropy of rich persons to whom such human misery was unbearable. But their charity was given only to those they regarded as the 'deserving poor'. This, in practice, meant that it was given only to those people regarded by the philanthropist as having demonstrated an acceptance of the social and economic status quo - and for as long as they did so. As the world's powerful nations have not (as yet) accepted the principle of international welfare, they apply the same 'deserving poor' notion to the reality of poverty outside their own countries. 'Aid' and non-commercial credit are regarded not as springing from the principles of human rights or international solidarity, regardless of national borders, but as charity extended as a matter of altruism by richer governments to the less developed and very poor nations. However, the quantity of this 'official' charity being increasingly inadequate to meet the most obvious needs, one of the criteria for a nation being classified as among the world's 'deserving pooor' came to be having 'good governance' as defined by the donor community. And in practice that phrase meant and means those countries having multi-party systems of democracy, economies based on the principle of private ownership and of international free trade and a good record of human rights: again as defined by the industrialised market economy countries of the North. It was in this kind of context that we in Africa first heard about 'good governance'; and this was the manner in which it was brought up at the Harare meeting to which I have referred. It was this aid-related discussion of good governance, a matter between aid givers and aid seekers, and the arrogant and patronising manner in which it was raised by the aid givers, that discredited the whole subject in the eyes of many of us in Africa and other parts of the South. For used in this manner, good governance sounded like a tool for neo-colonialism. We have therefore tended to despise the concept even as, out of necessity, we try to qualify under it. I am very far from being alone in rejecting neo-colonialism regardless of the methods adopted to bring it about or to enforce it or to define it! Yet we cannot avoid the fact that a lot of our problems in Africa arise from bad governance. I believe that we need to improve governance everywhere in Africa in order to enable our people to build real freedom and real development for themselves and their countries. And I allowed myself to be persuaded to be a 'convenor' of this Conference on Governance in Africa because I believe that it provides an opportunity for us to understand more about our past political and economic policy mistakes and see how we can improve the management of our affairs as we grope towards the 21st century. Government vs Governance Governments bear the final responsibility for the state of the nation - its internal and external peace, and the well-being of its people. It is the distinction between the words 'governance' and 'government' which draws attention to the reality that, despite its enforcement agencies, government (in the sense of the executive authority) is not the sole determinant of whether those responsibilities are fulfilled. For there are always other forces within a country which, in practice, can help or hinder the effectiveness of a government, and which it therefore ignores at its peril. Government is an instrument of State. Today there is a call, emanating from the North, for the weakening of the State. In my view, Africa should ignore this call. Our States are so weak and anaemic already that it would almost amount to a crime to weaken them further. We have a duty to strengthen the African States in almost every aspect you can think of; one of the objectives of improving the governance of our countries is to strengthen the African State and thus enable it to serve the people of Africa better. One result of weakening the State can be observed in Somalia. There are many potential Somalias in Africa if we heed the Northern call to weaken the State. In any case, dieting and other slimming exercises are appropriate for the opulent who over-eat, but very inappropriate for the emaciated and starving! Incidentally, the world has changed indeed! The withering of the State used to be the ultimate objective of good Marxists. Today the weakening of the State is the immediate objective of free-marketeers! In advocating a strong State, I am not advocating an overburdened State, nor a State with a bloated bureaucracy. To advocate for a strong State is to advocate for a State which, among other things, has power to act on behalf of the people in accordance with their wishes. And in a market economy, with its law of the jungle, we need a State that has the capacity to intervene on behalf of the weak. No State is really strong unless its government has the full consent of at least the majority of its people;

and it is difficult to envisage how that consent can be obtained outside democracy. So a call for a strong State is not a call for dictatorship either. Indeed all dictatorships are basically weak; because the means they apply in governance make them inherently unstable. The key to a government's effectiveness and its ability to lead the nation lies in a combination of three elements. First its closeness to its people, and its responsiveness to their needs and demands; in other words, democracy. Secondly, its ability to coordinate and bring into a democratic balance the many functional and often competing sectional institutions which groups of people have created to serve their particular interests. And thirdly, the efficiency of the institutions (official and unofficial) by means of which its decisions are made known and implemented throughout the country. Ingredients for Democracy It goes without saying that all of the institutions must be rooted in and appropriate to the society to which they are applied. The machinery through which a government stays close to the people and the people close to their government will differ according to the history, the demographic distribution, the traditional culture (or cultures), and the prevailing international political and economic environment in which it has to operate. For 'democracy' means much more than voting on the basis of adult suffrage every few years; it means (among other things) attitudes of toleration, and willingness to cooperate with others on terms of equality. An essential ingredient in democracy is that it is based on the equality of all the people within a nation's boundary, and that all the laws of the land apply to all adults without exception. The nation's constitution must provide methods by which the people can, without recourse to violence, control the government which emerges in accordance with it and even specify the means for its own amendment. In shorthand, the constitution itself must be based on the principles of the rule of law. It is inevitably the government which is responsible for upholding the role of law within the State. This, together with the making of laws, is one of the most important of its responsibilities to the people. But the government itself is subject to the constitution. All heads of state swear to honour and protect the constitution. this is as it should be; for the constitution is the supreme law of the land. We cannot respect ordinary laws of the State if we do not respect the constitution under which they were promulgated. A scrupulous respect for the constitution is the basis of the principle of the rule of law. This is an area where we need to be very careful. Presidents, prime ministers, and sometimes all members of a government, seek to amend a constitution in their own favour even when they come to office through, and because of, the provisions of a constitution which they have sworn to honour. Too often, for example, we have seen presidents seek to lengthen the number of terms they serve, despite the limit laid down in the constitution. This practice is wrong. It cheapens the constitution of the country concerned. If and when experience shows that the restriction laid down in the constitution is too restrictive and needs to be changed (which in my view should be very very rare), the change should not lengthen the term of the current office-holder, who is bound in honour to observe the restriction under which he or she was elected in the first place. And in any case, and more importantly, the first president to be elected under a restricted term of office must never change the constitution to lengthen that term. If he or she does it, it is difficult to see how subsequent presidents can honour the new restriction. Furthermore, if the provision of a limited term of office irks one president or prime minister, another provision of the constitution could irk another president or prime minister. We might then expect the constitution of the country to be changed after every general election. This is a point which in my view needs great emphasis. No Respect for the Consitution leads to No Basis for the Rule of Law. About the nature of government machinery - vitally important as that is to the maintenance (or establishment) of peace, justice, and the people's well-being - I need say little. A number of the previously circulated papers provide an excellent basis for serious consideration of this topic and its manifold implications for good governance. I would, however, like to emphasise one or two related points. Costs of Democracy All the institutions and processes of democracy and democratic administration cost a great deal of money to establish, to maintain, and to operate. That applies equally to official and spontaneous unofficial institutions - and to cooperation among them. Further, to be effective all such structures rely heavily upon the existence of a politically conscious civil society, which is active, organised and alert. Such a civil society will have a good understanding about the existence and functions of the different institutions, and about both their powers and the constitutional limits to their power. Dictators generally prefer an ignorant and passive or malleable population. It is easier to manipulate such a population and parade the result as Peoples' Participation. Yet Africa is at present poverty-stricken. I am the first to admit that a country does not have to be rich in order to be democratic. But a minimum amount of resources is needed in order to meet some minimum requirements of good governance. In Africa today, even the high echelons of the civil service receive salaries inadequate to keep a family for a month, and the minimum wage is derisory;

In Africa today, even the high echelons of the civil service receive salaries inadequate to keep a family for a month, and the minimum wage is derisory; and all salaries (especially of teachers and health workers) are frequently delayed. Nor have the people in general been the beneficiaries at any time of a well-organised education system directed at enlarging public understanding of and active participation in modern democratic institutions and processes. Poverty is an enemy of good governance, for persistent poverty is a destabiliser, especially if such poverty is shared in a grossly unequal manner, or is widely regarded as being unfairly distributed as the few who are relatively rich indulge in conspicuous consumption. Known or suspected corruption among the political leaders often makes the problem worse - and corruption throughout the society more difficult to overcome. Good wages or salaries will not stop bad people from being corrupt; but miserable wages and salaries are not conducive to rectitude. Political instability, real or imagined, can be a source, and is often used as an excuse, for bad governance. Corruption But to say this is very different from saying that because Africa is poor, Africans do not deserve good governance. This continent is not distinguished for its good governance of the peoples of Africa. But without good governance, we cannot eradicate poverty; for no corrupt government is interested in the eradication of poverty; on the contrary, and as we have seen in many parts of Africa and elsewhere, widespread corruption in high places breed poverty. Nor in saying this am I asking readers to accept the widespread belief that Africa has more corrupt, tyrannical, and power-hungry elites, than have other continents either now or historically. While avoiding the living and naming only a few of the dead, it is surely easy to see, in the past 75 years alone, our Mobutus, Iddi Amins, Bokassas, and military juntas, of Europe and elsewhere. In all European countries where the term of office is not limited by the constitution, my fellow politicians there pride themselves on how long or how short they remain in power. The trouble is that our Amins and Bokassas and Mobutus are Africans; but the Francos, Hitlers and Mussolinis are Spanish, Germans or Italians; and Africa played no role in putting them in power. Rather than conduct a post-mortem, we should try to help Africa and African countries to move forward from where we are now by addressing the central issue of building and strengthening the institutional framework of our continent and its countries. In doing so, to face the realities of Africa - all of them. Those internal, where our theoretically sovereign nations find their freedom to act is obstructed by the depth of our poverty and technological backwardness. And those realities external to us and beyond our control, in relation to which we are like a collection of pygmies in a world where giants stalk, and from where modern and constantly changing technology floods outwards over the world like an irresistible tide. The Ignored Truth Most countries of Africa are now once again 'coping' with the worst of their economic problems, and some are making well-based progress towards better living conditions for their people. We hear little about such difficult triumphs over adversity in the context of such things as international recessions and violent changes in primary commodity prices. Most of our countries are now living in a state of internal peace, and a peace which is deepening; we do not hear such peace unless it is broken. Despite the artificial and often unclear national borders of Africa, our States have very largely avoided violent conflict among themselves. Despite the histories of other continents, that accomplishment is ignored - even within Africa. And although this important success has been achieved largely through the work of the Organisation of African Unity (which African States themselves established), the media and the international community generally refer to the OAU with derision - if at all. Our children's expectation of life, and all that those statistics imply, has greatly improved - except where countries became the direct or indirect surrogates in Cold War conflicts, or were for other special reasons among the countries involved in prolonged civil strife. Africa does now have a core of highly educated and internationally recognised experts in different fields. Given the number of technicallyand professionally educated Africans in our countries at independence, and the paucity of secondary or tertiary educational institutions at that time, the number of high-calibre experts in Africa is now much larger than could reasonably have been expected after this lapse of time. Perhaps we are misusing them, but they are there now. At independence, some of our countries had no trained people at all. Finally, good or bad, the first generation of our leaders is fast being replaced by the second or even the third; most of these are better-educated, relatively free from the mental hang-overs of colonialism, and have had the opportunity to learn from the mistakes and the successes of their predecessors. With the help of work done at different fora, I am confident that African States, individually and in cooperation with one another, can step by step and in an ordered fashion, move towards Good Governance. The OAU exists and assists in the maintenance or restoration of peace and cooperation within Africa, even if it too is severely weakened in action and capacity by its lack of resources. Some sub-regional organisations are making limited but useful contributions to stability, peace and economic progress in their respective areas. The machinery of government and of unofficial institutions within African States can facilitate or hinder movement towards greater intra-African cooperation. And in addition, the all-African institutions, as well as those working on a sub-regional basis, may well be able to benefit by it - provided the actors bear in mind the prospective importance of the role these intra-African institutions can play in strengthening us all. - Third World Network Features Marxism in Africa | Julius Nyerere

Pietro Secchia 1944 Our War First published: Il Combattente, January 1944, no. 5; Source: I Communisti e l’insurrezione, 1943-45, Editori Riuniti, Roma, 1973; Translated: by Mitchell Abidor; CopyLeft: Creative Commons (Attribute & ShareAlike) marxists.org 2007. The fascist traitors, having put themselves at the service of the Germans, are emitting loud squeals for their sudden losses under the blows of the patriots. They speak of cowardly assassins, or horrible misdeeds, etc. What are the fascist hierarchs thinking? That they could betray the fatherland with impunity, place themselves openly in the service of the enemy without running any risk, without paying the price for their ignominious treason? Perhaps they thought they could make war against the Italians without their blood being spilled? What do all these wailings mean, these cries of indignation and fear on the part of the fascist hierarchs? Don’t they know that you go to war with two proverbial sacks, one for taking and one for giving? The Italian people have declared war on Germany, and never has a war been more just or more sacred. The Italian government, the only legally existing government, interpreting the aspirations and e will of the entire Italian people, gave a legal dressing to this popular declaration of war. From that moment it was the pressing duty of every Italian to fight with all his might and with all his means to chase the Germans from our soil. However, at that moment hordes of degenerate Italians, calling themselves republican-fascists, betraying as they have always betrayed the interests of the fatherland, aligned themselves with the Germans and are carrying out, at their service, the fight against the Italians, against the fatherland. There has never been a more infamous betrayal, a betrayal that so cries to heaven for revenge; one which has kindled the most violent reaction on the part of the healthy portion of the Italian people which, despite all they suffered from the fascist regime, was so generous after July 24 as to spare the lives of all the fascist hierarchs. At the time there was no vengeance, no reprisals, no killings. But after Italy’s declaration of war on Germany, from the moment this horde of traitors placed themselves at the service of the Germans, any consideration became a crime, any toleration a betrayal. From that moment the Italian patriots justly considered and treated as traitors to the fatherland the fascists in service to the Germans. War is war. If you don’t want to be killed don’t go to war. He who doesn’t want to die by lead shouldn’t betray the fatherland. But these traitors still dare to accuse the patriots of cruelty and cowardice. The entire Italian people know the infamous crimes perpetrated for twenty years by the fascists, know how their German bosses conducted themselves in conquered nations. We are in open war, declared against Nazism and fascism, but the Nazi and fascist canaille doesn’t treat the patriots and partisans like soldiers, like combatants, but make them suffer unheard of tortures and sufferings. And then they have the shamelessness to cry out and get indignant, to try to move public opinion when the hierarchs responsible for so many infamies fall to the lead of a few popular avengers. They fall fulminating, but they fall the way one does in war, without torture, without being the object of cruelty and suffering. Till now the partisans and the patriots have carried out the war like loyal and strong combatants, without abandoning themselves to the baseness and cruelty that only the fascist hyenas are capable of. But these people should know that if they continue to fail to treat the partisans and patriots as combatants, if they continue to arrest as hostages the family members of those who refuse to serve the Germans, if they continue to massacre innocent citizens in reprisal, well then, the patriots will know how to respond in the same way, to render blow for blow. The patriots, too, have fascist and German prisoners. The patriots, too, could begin to arrest family members of Messrs. Hierarchs and Messrs. Industrialists who collaborate with the Germans. Attention, Messrs Hierarchs and Messrs. Industrialists: don’t complain if your crimes and misdeeds were to fall upon your heads and those of your loved ones. Don’t cry out abut cowardice: you will have willed it. Pietro Secchia Archive

Pietro Secchia 1948 Italian People in New Phase of Struggle Written: By Pietro Secchia, 1948; Source: For a Lasting Peace, for a People's Democracy! Vol. 2, no. 12; June 15, 1948; Transcribed: David Adams, March 2022. The result of the April general election did not demoralise the mass of the working people of Italy. If anything, the May strikes and discontent, which involved hundreds of thousands of workers and peasants, demonstrated the strength and fighting spirit of the forward elements of the Italian people. The election struggle was but a phase, a very important phase, it is true, in the life of the working people. And those who had calculated on burying the Communist Party, the Popular Democratic front and eight million Italians under the piles of voting papers, appear ludicrous indeed. The press of the Italian plutocracy and of American imperialism were somewhat rash in proclaiming victory. The battle which the Popular Front withstood during the election campaign, is being fought out in the form of the democratic struggle and actions of the people. In this struggle for its vital demands and wider political and social aims, the working class is displaying its growing strength. The experience of the struggle during the recent weeks and months is making it increasingly clear to millions of working people that recovery cannot be brought about merely by parliamentary action and by struggles of an economic character. The election campaign helped shatter certain illusions about quick and easy victories without struggle and casualties—illusions of which the Party had warned Communists and all the democratic forces. The draconic repressions and blackmail which the Government and ruling classes applied to achieve their victory revealed to the broad masses of Italy the true colours of bourgeois pseudo- democracy. It has been said that in the course of a conversation with his colleagues, the Minister of Police, Scelba, made this valuable admission: “A ruling party which decides to hold an election and then proves incapable of winning, is not a party but a gathering of fools”. In this “Christian” fashion Scelba admitted the colossal fraud practiced according to the American prescription. But constitutional and pacifist illusions have suffered yet another blow. The police and military are being used in the growing struggle between labour and capital. With the intention of cashing in on their election “victory” the big industrialists and landowners, supported by the Government, have launched an offensive against the working people. This offensive aims to abolish or, at any rate, drastically to curtail the gains won by the people since July 1943, to isolate the working class, break working-class unity and split the trade unions; it aims to secure additional profits at the expense of the people and to force them to bear the brunt of foreign imperialism. The recent strikes showed how vigorously the working people are combating the offensive of reaction and how they are preparing for the battle ahead. Growth of the Strike Movement As enumeration of the more important strikes and actions that have taken place since polling day, April 18, reveals on the one hand, the tense nature of the struggle and the militant spirit of the workers. April 25—Notwithstanding the attempt of the Government to prohibit all celebrations on the anniversary of the national liberation, partisans and the people held big demonstrations. In Milan, squads of police armoured cars and tanks failed to disperse the demonstrators. Twenty workers were wounded by the police. April 30—Discontent and lockouts at the Falc works in Milan. May 1—For the first time since the overthrow of fascism. May Day was a day of celebration and struggle and nation-wide stoppage of work. Monster demonstrations were held throughout the country against the Government’s policy and in support of trade union unity. May 9, 10—Demonstrations in Naples and Genoa, Questions in the Senate, The General Confederation of Labour and the Popular Front insist on the right of asylum for 35 Greek patriots who had arrived from the Argentine and whom Scelba wanted to hand over to Tsaldaris. May 10—General strike in Turin in protest against police raids on local Communist Party organisations. The beginning of the big agricultural labourers’ strike in the Rome province, which lasted several days and ended in complete victory. May 11—Strike of 50,000 agricultural labourers in Mantua Province. May 12—Strike spreads to the Rovigo, Udine and Modena provinces embracing 120,000 agricultural labourers who struck work because of the violation of agreements by landowners and Government, and who insisted on new collective agreements. May 16—2,000 workers in the Upper Flumendosa Basin (Sardinia) go on strike. Strike continued for more than a fortnight. May 17—Gas workers win their demands. Strike of municipal employees in Taranto. May 19—University students in Palermo protest against increased fees and occupy the university premises. May 20—Workers of the SIMA works in Iesi (Ancona) occupy premises to prevent dismantling equipment. May 21—After a 16-day strike the agricultural labourers of Polesini win complete victory after smashing combined front of the landlords. Thousands of spinners in Cremona province go on strike, demanding observance of labour agreement and payment of deferred earnings. Many mills occupied by women operatives. After several days, strike ends in complete victory. May 22—General protest strike declared in the provinces of Venezia, Padua and Rovigo in reply to the police murder of a strikers in Trecenta. Agricultural labourers’ strike in Pisa province. General strike of agricultural labourers in Bologna. Strike lasts 15 days. May 23—Students strike at Bari.

May 23—Students strike at Bari. May 24—Big demonstration in Milan in solidarity with the people of Greece. General strike in Modena province against police violation of democratic liberties. May 25—General strike of auto-transport workers to win their demands and recognition of their factory committees. May 26—Strike of 25,000 agricultural labourers in Cremona. May 27—Discontent among 60,000 tobacco workers in Salento (Apulia). The factory committees decide to continue the struggle until complete victory. May 28—Agricultural labourers in Milan area join the general strike which has been in progress for several days already in the Mantua, Bologna, Reggio Emilia, and Cremona provinces and in different parts of Venezia. Total of 300,000 peasants on strike. On the same day general protest strike is declared in Cosenza province against police persecution and in defence of democratic liberties. Workers declare a strike in the Ducati plant in Bazzano (Bologna). May 29—General strike in Placenza. May 30—Strike of marker gardeners and horticulturists in the Naples province. May 31—Monster demonstration of building workers, unemployed and homeless in Bologna. Strikes of iron and steel workers in Naples, electrical workers in the province of Reggio Calabria and agricultural workers in the province of Cagliari. The miners of Aragona (Sicily) occupy the pits in Enna and remain underground for four days with little food or water. June 1—Mineworkers’ strike in Carbonia (Sardinia). June 2—Big demonstrations in all cities celebrate the anniversary of the Republic. The demonstrations take the form of protests against the Government’s violation of the Republican Constitution. Sharecroppers in Pesaro province demand more favourable distribution of the harvest. June 3—Mineworkers declare a general strike in protest against the closing down of industry miners in Valdarno, Ragusa, Foggia, Aragona (Sicily). Shipbuilding workers in Palermo who a month ago seized shipyards declare a general strike in support of the iron and steel workers. June 4—General strike in Bologna province in protest against the arrest of four trade union officials and against police persecution. The above list refers only to the principal actions of Italy since election day, April 18. While these actions were, in the main, of an economic character, they are important politically, from the point of view of character, scale and duration, and because in the present situation, they take on an altogether new aspect. Against the Marshall Plan Special note should be made of the action taken by the Palermo shipbuilding workers. When the owners of the shipyard decided to get rid of 78 workers, the other shipyard men protested. The management of the shipyard walked out and the workers took over and continued to run the yard. The significance of this incident goes beyond the framework of ordinary class solidarity. Behind these events in the Palermo shipyard stood the Marshall Plan, threatening Italy’s industry and the lives of her people. In his message to Congress on December 20, last year, on the Marshall Plan legislation, Truman said that United States interests would be safeguarded better if commercial shipping built during the war was leased or sold to Marshall countries. Due to the steel shortage, the sale or leasing of these ships would be related to the cutting of shipbuilding programmes in the participating countries. This explains why the Palermo shipyard was closed down. The same thing applies to the unrest among mineworkers, the first to feel the effects of the Marshall Plan. In Terni, Grosseto and Sicily, they took action against the mines being closed. Like the Palermo shipyard men, the mine-workers are fighting not only for bread and work, but also to save Italy’s baste industry and for the country’s economic and political independence. Once again they show that the interests of the working class are identical with the interests of the nation as a whole. The students’ strikes are a new and important factor. Undoubtedly they indicate a democratic and progressive awakening of Italian students. The students are beginning to protest at the clerical attacks against education and culture and see for themselves that the Popular Democratic Front is capable of breaking this reactionary onslaught. New Character of the Struggle The open interference by the government and the armed forces on the side of the big industrialists and landowners are changing the situation. The struggle of the working class is taking on a new and sharper character. All over the country the police are violating the people’s rights. The fierce attacks on strikers, the atrocities of the carabinieri, the arrests of strikers and trade union leaders are becoming the order of the day. Carabinieri and police continually open fire on demonstrators. Today the police are doing the same job that the fascist mobs did in 1921-22. In rural districts the and carabinieri are acting as strike-breakers. In the south, police are actually besieging towns and are conducting hundreds of unauthorised searches and arrests. The police state which has been created by de Gasperi, supported by, Saragat’s “third force”, is turning the Italian Republic—which, according to the Constitution, should be “based on labour”—into a clerical republic based on machine- guns and Scelba’s police clubs. Because of the interference of the Government and the armed forces, each strike becomes a pitched battle and each demonstration a street fight. This year there is the danger that even the fields may become battlefields. However, the big capitalists, landowners and the gentlemen of the Government are making a mistake if they think they can smash the working class organisations with machine-guns. Violence is encountering the vigorous resistance of the masses.

Violence is encountering the vigorous resistance of the masses. Every attack on the workers’ liberties, on their right to strike and to organise, every violation of democratic liberties, will only sharpen the struggle; economic strikes will develop into political strikes, into the struggle for freedom and democracy. The task of the Communists is to strengthen and consolidate the Popular Democratic Front which should become even more strongly the leading force in the broad mass movement. For this it is necessary to maintain unity of action with the Socialist Party, the basis on which the Popular Democratic Front can, be strengthened and extended. We must prevent the vanguard forces of the working class from becoming isolated. The struggle for radical reforms, for freedom, peace and independence can be successful only if the broad masses of the people, and not just the vanguard, take part in this struggle. The strikes must not be restricted to isolated actions, not even to mass actions of a defensive and economic character. The task of the Communist Party, of the trade unions and of the Popular Democratic Front is to coordinate and lead these actions, and to combine the struggle for day to day demands with the struggle for structural and social reforms, to develop economic strikes into political ones. Our task is to guide the struggle throughout the country, advance correct economic and political aims, take into account the new character of the struggle, so that the solidarity and alliance of the vanguard with the working people is strengthened and ever broader sections of the population are brought into the struggle. There must be no concessions to illusions, to the hopes of any “miracle” and to revolutionary phrase-mongering; no concessions to those who advocate that “the worse things get, the better it will be for us”, but a resolute struggle against the opportunist influences of Social-Democracy. The entire party must be mobilised to strengthen the unity and improve the work of the trade unions! Today not only the day to day interests of the workers, agricultural labourers and peasants but also freedom, peace and the future of the Italian people are menaced. The working people of Italy, rallied around the Popular Democratic Front, will be able to remove this threat and win a better future for themselves. In this struggle for progress and democracy the Communists will remain in the forefront. Secchia Archive

Pietro Secchia 1973 The Masses Join in the Struggle Source: Il partito communista e la guerra di Liberazione. Feltrinelli, Milan, 1975; Translated: by Mitchell Abidor; CopyLeft: Creative Commons (Attribute & ShareAlike) marxists.org 2008. On November 15 1943, in all of the metallurgical factories of Turin the first general strike under the German occupation occurred. There then followed others in Genoa, in Milan and many other locales during the winter and until the end of the war of independence, until the April insurrection. The Italian Resistance, unlike that of other countries, was characterized by the combining of the working masses with the military action of the partisans. The one supported and was presupposed by the development of the other. The class struggle was a key propelling element that gave impulse to the development of the fight for national liberation. In every era the national struggle has had a class character, and in every historical period there were determined men, determined social classes that represented the interests of the nation. There were men and political groups, also within the CLN (Committee for National Liberation) who had doubts about the possibility of successfully conducting the fight for national liberation if, at the same time, the parties of the workers favored and gave impulse to the developing of the class struggle, to the organization of strikes and to agitation in factories and fields. On the contrary, we Communists thought it was possible to give a just start and give a powerful impulse to the fight for national liberation only if at the same time there the defense of immediate, economic and social interests, as well as the more general ones of the working classes were brought to the forefront. We never contented ourselves with or underestimated the class struggle, (which in any case would have been impossible); this was expressed not only in the actions against the German occupier, but against the big Nazi-fascist collaborationist industrialists. This was the political line, the constant goal of the leadership of the PCI in upper Italy, profoundly persuaded as we were that the interests of the working class were not in contrast with those of the nation. All of the political strikes organized during the Resistance had economic demands as their point of departure and foundation. These were directed against the Nazi-fascists and the big collaborationist industrialists. The struggle for bread, for wages, against exploitation, in defense of dignity became at the same time national struggles for the chasing out of the German invader and the defeat of fascism. The workers were stimulated to action by the very conditions of their existence, but in its turn the thrust of the class struggle every day impelled and carried along an ever larger number of men to participate in the fight for liberation. Economic demands were placed to the forefront either to “cover” as far as possible the strikers from German-fascist reaction, or because they touched all strata of the workers, from those who were in the vanguard to those who were most backwards, less evolved and who weren’t interested in politics but wanted to defend their own right to live. But it would be a mistake to say that since economic demands were at the base of the agitation and propaganda for the strikes, the workers were led to act mainly because they were moved by economic interests. Most workers knew full well the risks they were running striking and sabotaging production. German and fascist terrorism made their weight felt and exerted their influence, even if in different amounts, throughout the period of the war of liberation. Wages, piece work, working hours, a greater amount of food and fuel were important things, but not to the point to drive the most advanced part of the workers to jeopardize their lives, to risk deportation in order to obtain an increase in their salary of a few liras or a slightly larger ration of awful olive oil. If they did this it was because they were moved not only by economic necessity but by idealist, social and national motives, by profound sentiments of hatred of fascism, of love of liberty and the conquest of independence; in many cases it was the aspiration for socialism, economic, political and idealist motives intermingled and were melded into one sole thrust in the same way that many streams debouch into one great river. The fact that the working class managed to exercise its leading function in the struggle for national liberation, taking as its starting point the defense of its interests and aspirations, demonstrates the way the national struggle was something profoundly real, inseparable from the very conditions of the workers’ existence. In defending its own positions and affirming itself, the working class, at the head of the laboring masses, affirmed the interests of the people and the entire nation. This gave the Italian Resistance not only a mighty verve, but a progressive imprint that characterized it and distinguished it in a more marked way than that of other countries. In Italy the Resistance was antifascist, and more than elsewhere fought against those groups of big capital that gave birth to fascism, supported its policies, and led the country to wars of aggression and catastrophe. And more than elsewhere the Resistance had a class character: there was at one and the same time a national and a social struggle both because of its content and because the working class was the main leading force. And it was from the working class, from the parties and men who represented it, that there came the most advanced watchwords, proposals, the most correct indications and solutions, those which best corresponded to the interests of the whole people and the nation. During the Resistance as well the laboring classes fought against the groups of finance capital, against big capital, fought to conquer liberty for all citizens, for the workers, the peasants, for the oppressed classes; fought to give birth to a new political and social regime that would realize profound structural reforms and a true, effective, new democracy. They fought to extirpate the roots of fascism, to liquidate the most iniquitous privileges of capital and large landowners. They were the representatives of the working class and laborers who, within the CLN, proposed and supported those programmatic demands that expressed profound popular aspirations; aspirations and objectives that, to be sure, didn’t correspond to the will and the designs of all the movements that more or less directly participated in the Resistance.

aspirations and objectives that, to be sure, didn’t correspond to the will and the designs of all the movements that more or less directly participated in the Resistance. Aspirations for a profound, radical economic and social renewal for which the workers, the most advanced sectors of the peasantry, of laborers, of progressive intellectuals fought that , to be sure, didn’t constitute the whole of Italian reality. Other classes, other parties acted in this situation within and outside the Resistance, and fought with varying and contrasting objectives for liberation solely through the work of the Anglo-Americans, aiming at the restoration of capitalism, the return to a regime of conservative democracy. From which came the discord in unity, and the continuous struggle within the CLN to have determined solutions and carry the movement as far forward as possible. Initially the CLN was indifferent to the strike front, failing to assume a position of active solidarity and support; such an attitude corresponded to a different conception of the action to be carried out in order to reinforce the Resistance and the war of liberation. The CLNAI indeed voted an order for a day of solidarity with the powerful movement pf the workers of Turin of November to December 1943, but did nothing to give concrete assistance to the movement itself and its development. The representatives of some of the parties within the CLN maintained that the strikes touched on and hurt certain interests, weakened national unity and alienated from the CLN certain capitalist forces which at that moment were disposed to assist the war of national liberation. Decisively rejecting these arguments, and maintaining that instead of braking we had the obligation to encourage the organization of the strikes , up to the general political strike in all of German-occupied Italy, up to an insurrectional strike. We openly criticized the position of certain members of the CLN: for us unity was not a holy arc, an altar before which the interests of the working class and laborers must be sacrificed. The CLN, if it really wanted to be the leading center of the war for national liberation had to be able not only to be in solidarity with, but had to also organize, assist, support, and strengthen to the highest degree the fight of the working class; had to be able to extend this struggle and other strata of the population participate in it...It was necessary that the CLN become a true combat organization, a truly leading organization of the war of national liberation. Without denying that here and there were strikes that were relatively spontaneous, the majority of the strikes and agitation were organized. Initially the Germans allowed the internal commissions to continue to exist; in this way they attempted to keep in their hands the means to control and put a brake on the working masses. The directive was given to all Communists and workers to hinder the internal commissions, to refuse to participate in them and not to participate in their elections. It was obvious that the Germans and the fascists, recognizing the internal commissions, held the workers participating in them responsible for all that occurred in the factories, the production rhythm, for the workers’ protests, for sabotage. The internal commissions were obliged to be true “collaborationist” organisms with the bosses and the Nazi-fascists. We proposed to the workers to instead name in every factory a secret agitation committee of a unitary character. The task of every agitation committee was to see to the needs and demands of the workers, to organize agitation, to lead strikes, and to strengthen the struggle against the collaborationist industrialists and the Germans and fascists. In the face of this just position, here and there we found opportunist attitudes which, under the mask of intransigent and extremist positions, claimed that the internal commissions should continue to exist because “’they represented a conquest of the working class.” We decisively rejected such positions; these were conquests which at a given moment had a progressive and revolutionary character, but susceptible in a different situation to being transformed into instruments of collaboration with the class enemy. In their overwhelming majority the workers understood the directive of the PCI. After just a few days the internal commissions, despite the enticements and threats of the Germans and fascists, resigned. In the main factories there arose secret agitation committees, unitary organisms which at that moment took as their principal task the organization of strikes and agitation against the German invaders and the fascist traitors. Our directive said that it was expected of Communists to promote the formation of these committees of clandestine agitation and to be their animators, to have them supported by all the workers so they be up to their tasks, which went from immediate, daily demands to the supreme political duty: the preparation of armed action for the driving out of the Germans, for the radical elimination of fascism. The strikes moved quickly, growing day by day until they reached the general strike in Upper Italy of March 8, 1944 and the days of national insurrection of April 18-25, 1945 ... We repeat: the strikes were not, except for a few exceptions, “spontaneous.” On the contrary, a great amount of energy was invested in organizing them. The fantasist picture put forth by those who didn’t know the period or participate in the struggle that it was the working class and the masses who from the base called for the continuous struggle at the front against a Communist leadership that intervened to brake, limit, and derail the struggle, does not correspond to reality. It is precisely the contrary that is true, which is obvious and natural. For us it was relatively easy to elaborate political and organizational directives for the preparation of strikes, attacked by the armed partisan groups of the GAP, for the development of the great mass struggle and larger scale partisan battles. Much more arduous and difficult were the tasks to which these directives applied, translated into action. The workers, and in the first place our comrades, who in the cities and the factories had to apply our directives, knew full well that every strike, even when it was victorious, was followed by arrests, deportations, and executions; they knew they would have to pay, and pay dearly. In this mass struggle, as in the conduct of the partisan guerrilla war, we certainly made mistakes; there were weaknesses, hesitations even among the most advanced parties in the democratic ranks who had always to confront opposing forces, even within the CLN, and with a complex, harsh and difficult reality.

But we never found ourselves following the masses, we never committed the error of being a brake; we only took into account the difficulties the working masses would encounter in applying each of our directives for a bolder, broader and more advanced action. To be sure, we didn’t close our eyes to objections, to observations coming from the base; we weren’t indifferent to the cost, to losses. All of which led us to elaborate directives for actions that corresponded to their possibility of being realized, and not castles in the air. The impression shouldn’t be given that they were elaborated by incompetents or visionaries. The directives were always an incentive to do more, to move ever forward. Pietro Secchia Archive

Pietro Secchia 1973 The Politico-Military Preparations Source: Cronistoria del 25 aprile 1945. Feltrinelli, Milan, 1973; Translated: by Mitchell Abidor; CopyLeft: Creative Commons (Attribute & ShareAlike) marxists.org 2019. June 4, 1944 the Allies entered Rome, the first European capital liberated. June 6 they landed successfully in Normandy, the largest amphibious military action that had ever taken place. “The history of war has never known its like in its proportions, the vastness of conception and its magisterial execution.” (Winston Churchill) The Anglo-Americans had employed 11,000 fighter planes, 4,000 warships and thousands of smaller vessels, sent 20,000 parachutists behind enemy lines; during the 24 hours they landed 250,000 men and air-transported three divisions onto the French coast. The Second Front was finally a reality. June 23, in accordance with the Teheran Agreements, the Red Army began its sweeping offensive, smashing the German front in Finland and breaking through the center at Vitebsk and Gomel. Thirty German divisions were cut off in the Baltic countries. In July the press of events became precipitous. While the Anglo-American armies cleaned out Cherbourg on June 26 and liberated Caen July 9 and headed rapidly towards Paris, the Soviet army shattered Von Model’s lines, liberated Minsk July 5, Vilna the 13th and Grodno the 17th, bursting through to the western the borders of East Prussia. On July 20 the attempt on Hitler’s life laid bare to the world the end of another myth. The unity of the German leading groups and the tightness of the internal front were collapsing under the overwhelming weight of the defeat. A plot organized and led by a group of generals from headquarters, in attempting to physically liquidate the dictator, had sought to save what could still be saved. The hour so long awaited by the oppressed and martyred peoples of Europe, the hour of the concentric general offensive, from the east, the west, the north and the south, had arrived. A tremor of general revolt ran through the European resistance: the final battle had begun. From the very beginning of the partisan war the objective of national insurrection was present in the thoughts and the actions of the Italian anti-Fascist parties; and in particular the insurrection was the object of serious and constant preparation on the part of the Communist Party, the Action Party, and the Socialist Party. But the development of events imposed the necessity to accelerate its organization. All the anti-Fascist parties and movements were in agreement on the principle of the insurrection (this was the objective that the CLNAI as a whole put forth). But as the hour to set it in motion approached it was inevitable that the divergences among them would appear concerning what they considered indispensable to the success of the war of liberation but which that they nevertheless feared as a great danger; divergences that manifested themselves in the various commitments that the parties in the CLN made for preparing and organizing it. The insurrection, though it had a largely national and patriotic character, was no longer a purely military operation, but was above all a powerful fight of the popular masses, and for this very reason was a revolutionary movement: the conservative classes could not but be frightened. In the first months of the partisan struggle the Communists had already openly and clearly posed the problem of the national insurrection: “The political strike, the national insurrection cannot simply be simple watchwords for purposes of agitation: they must already be concrete tasks of organization and preparation. We must continue, expand, and make general the armed struggle for national liberation that has already begun; the partisan struggle in the first place but also the mass resistance to Fascist and Nazi orders as well as the protest movement of the masses against their oppressors and exploiters. Through this struggle the framework and the organisms of the insurrection will be created, training the masses for the final attack and the victorious insurrection.” (L'Unit�, Dec 24, 1943, Northern edition) This would be matured through the development of multifaceted partisan actions, workers struggles in the factories, and peasant movements in the countryside. With these concepts as our starting point, from the very first months of the partisan war we had precise directions for the creation of Agitation Committees in the factories and the objectives that the general political strike could pose. “In the insurrectional strike we must occupy the factories, not to barricade ourselves inside, but to make fortresses of them, points of support for armed insurrectional actions to be conducted outside against the enemy’s strongholds and his vital points.” (L'Unit�, Dec 24, 1943, Northern edition) Orders were given to the railway workers that on a given day it would be their duty to take over the most important railway centers by force; to stop enemy transport; and to put themselves at the disposition of the insurrectionary centers, in the same way that it would be the duty of the postal and telegraph workers to occupy the telegraph and telephone centers and the radio stations.

and to put themselves at the disposition of the insurrectionary centers, in the same way that it would be the duty of the postal and telegraph workers to occupy the telegraph and telephone centers and the radio stations. It was a question of tasks that were serious and indispensable for the preparation of a victorious national insurrection which could not be improvised at the last minute; it was necessary to make prior arrangements for their realization. Insisting on these arguments from the first months of the partisan struggle was politically and militarily correct, but didn’t fail to also provoke some erroneous interpretations which had to be clarified in order to avoid grave consequences for the victorious development of the struggle. Especially in the course of the general strike of March 1944 there came to light an opinion quite widespread among the working masses and the population of the industrial centers, that is, that the strike had an insurrectional character and that the moment had come to finish off the Germans and the Fascists. In the popular quarters in particular the rumors were rampant that thousands of partisans had come down from the mountains and had occupied the city. The objective situation itself had created certain illusions and led to the circulating of the most sensational rumors (the workers understood full well that the essential problem wasn’t that of the improving of economic conditions, but rather that of driving out the Germans.. They understood that there could be no real solution to the problem of living conditions if we didn’t have done with the Nazi-Fascists), but in part there were also some defects in our press and the erroneous interpretation of some watchwords, for example the one that said , “Prepare for the national insurrection.” Having insisted on this in articles and directives on this theme, while at the same time preparing the general protest and political strike of March 1944, contributed to creating a certain confusion. “Prepare for the national insurrection” was here and there interpreted as an immediate watchword. After the March general strike they continued to hammer away at the need to “prepare the national insurrection in every detail” but at the same time stressed that they weren’t joking about insurrection (we wanted a victorious insurrection and not an adventure), that this could only be unleashed when the force of the Italian people would be ready to strike and bring down the enemy: “therefore the moment and the hour of the national insurrection will be chosen by the Italian people and not by the enemy.” The beginning of the battle for Europe announced that it was time to prepare the insurrection, not only on the political but also on the military plane. June 28, 1944 the General Command of the Corpo Volontari della liberta sent directive no. 5 to all the regional commands, having as its objective “the examination of the objectives” of the insurrection in the cities, the situation of effectives, and the elaboration of plans for insurrection and the systematic acts of sabotage. Such directives consisted in a series of instructions concerning the tasks that every partisan commando had the duty to propose in order to accurately know the topography of the city and the surrounding territory (factories, barracks, rail lines, seats of the enemy command, etc), the strength of the enemy and that of the patriots, their effective efficiency, and for the intensification of attacks and acts of sabotage against the enemy. Every peripheral command was assigned the task of elaborating a concrete insurrectional plan within the scope of its area of competency, which was to reflect the immediate objectives and actions for the systematic development of military action, up to and including the driving out of the enemy and the occupation of the zone by the patriotic formations. For their part the leaders of the Action Party insisted that; “It is very true, and will become ever more obvious, that our people, along with the other oppressed peoples, are leading an untiring insurrectionary struggle against those who have profited from this war, against those who enslaved them, against Nazism and Fascism. We are on the road to the anti-Hitlerite national insurrection of the European continent. And this is the problem: don’t allow the struggle to be derailed or falsified. Don’t allow the fruits of our victorious rescue to escape us.” (L'Italia Libera, no. 9,July 10, 1944) Even after the liberation of Rome and the opening of the Second Front there were those who thought, the Liberals and the Christian Democrats among them, that there was nothing else to do but to carry on with our every day routine. Their representatives within the CVL approved the directives, but in the underground press of their parties “insurrection” was never spoken of; the word was strictly avoided, and this wasn’t accidental. In issue no. 5 of Risorgimento Liberale of May 1944, on the eve of the liberation of Rome, while the partisan struggle raged in all the valleys, there was not one single word inciting to armed struggle, and in an article entitled “Look ahead” they limited themselves to saying, “ Today this alone must we urge our readers: Don’t be discouraged. Don’t believe the pessimists and the spreaders of doubt. Continue to put up with things and you will see that the future will be peaceful. We will again take up our trade.” Democrazia Cristiana, in issue no 2 as well as in the following issues, published in bold letters an article with the title: “What should the Christian Democrats do? In this hour of waiting every good Christian Democrat, convinced of the rightness of the cause, should not remain inert, but should carry out with prudent courage an active propaganda for our ideas, should make known our program, should distribute our leaflets and Democrazia.” Some called to continue to put up with things and to already look forward to the “taking up of trade,” others spoke of “this hour of waiting.” It was certainly not with the spirit of prudent courage that the insurrection could be prepared. The Communist party responded to all of them with open criticism, inviting them to greater combativeness and to put in practice the decisions that had been taken in common in the CLN. “It isn’t enough to decide, to accept, to approve. It is necessary to execute; it is necessary to honor one’s own signature.

It’s not enough to pronounce against a wait and see attitude and to allow the partisan formations that you say you direct and control to not show any sign of life through concrete actions against the German and the Fascists. We are above all speaking to our Liberal friends, our Christian Democratic friends. It’s not enough to say that one is against every form of pacification, of non-belligerency with the enemy and then allow that negotiations in this sense be begun with the Germans and the Fascists. It’s not enough to say that you are for the general strike, to sign to this effect – as the Socialist Party has done – a common appeal with our party and then allow organizations to refuse to march, as occurred in Florence and Padua. And it’s even worse to allow the Turin organization to issue during the strike, on its own initiative, a tract that ordered the return to work without party measures being taken” (La Nostra Lotta, March 5-6, 1944) These parties, though, were very busy preparing names and lists of the men who, when the liberation occurred, would be appointed to head prefectures, communes, and public administration. Instead of working to prepare the insurrection, they were intent on preparing the plan for afterwards, having in view putting the old structures of the state back in place; not, to be sure, democratic, but pre-Fascist. It never occurred to the authors of these plans that the organized and triumphant national insurrection would create on its own its own organs of power and order, and that these organs had to be the Committees of National Liberation. “The new order that will issue from the insurrection,” we wrote, “if it wants to be vital and not betray popular aspirations, can only be democratic in the widest meaning of the term, can only base itself on the same organs that have today already marshaled the national masses and lead them in the struggle, and which will tomorrow lead them to the insurrection and to victory. These organs are the Committees of National Liberation and the formations that belong to it; factory agitation committees, peasant committees, village committees, partisan formations. Preparing plans for after the insurrection, based on prefects, police supervisors, and mayors, along with carabinieri and policemen formed by twenty years of Fascism, means preparing the stifling of the insurrection itself in the more or less short term. Behind these plans are hiding the same anti-popular and reactionary forces who we have already found behind the attempts to stifle the partisan struggle and the protest struggles of the workers.” (La Nostra Lotta, March 5-6, 1944) With this as the starting point, obviously the varying viewpoints of the forces united within the CLN against the common enemy were divided by class interests that led them to act in different ways. Organizing the insurrection and the post-insurrectionary period by the truly democratic forces had the very precise meaning of reinforcing and strengthening all the organs that led the struggle against the Germans and the Fascists, transforming them into ever larger mass organisms, and converted the Committees of National Liberation the future organs of government. Pietro Secchia Archive

Pietro Secchia 1958 Women Partisans Source: Il Monterosa � sceso a Milano. G. Einaudi Editore, Turin, 1958; Translated: by Mitchell Abidor; CopyLeft: Creative Commons (Attribute & ShareAlike) marxists.org 2009. As the war of liberation draws to its victorious conclusion, our chronicle would be incomplete if we were to remain silent about the functions carried out by a brigade that didn’t fight, but which nevertheless participated in all the combats, that was ever-present, worked everywhere without firing noisy shots, but whose action was even so as effective and necessary as that of the more perfected arms: we’re talking about the nursing, courier, and intelligence women partisans. The Resistance, however great might have been the courage of the men, would not have been possible without women: their functions were less flashy, but no less essential. There is no comparison between the participation of women in the fight for the Risorgimento and that for national liberation. It was then a matter, except for the insurrectional days in the cities and the popular revolts, of a few chosen ones, of shining examples, but not of mass phenomena. “A fundamental characteristic of the women in the Resistance, which was one of the most vital elements of the war of liberation, is precisely its collective, almost anonymous character; its having as protagonist not some exceptional beings, but the wide masses, belonging to the most varied strata of the population; its being born, not from the will of a few, but from the spontaneous initiative of the many.” [1] The first partisan couriers and spies were women. Initially they brought, along with assistance in the form of food and clothing, news from home and information on enemy movements. Quite quickly this spontaneous work became organized, and every detachment created its own couriers, which specialized in shuttling between the city centers and the command of the partisan units. The couriers constituted an important gear in the complex machinery of the partisan army. Without the secure liaison carried out by the couriers, directives would have remained a dead letter; assistance, orders, and information would not have arrived in the various zones. Their work was delicate, difficult, and almost always dangerous. Even when they didn’t cross the lines during combat under enemy fire, they had to pass through the steep slopes of mountains, in pouring rain with dangerous, cumbersome material, covering hundreds of kilometers on bicycle or truck, often on foot, in the rain and the fury of the wind. Crushed in trains, squeezed against the disconnected axis of a cattle car, the couriers passed long hours, often forced to pass a night in a station or in an open field, facing the dangers of bombardments or a German ambush. They often had to precede the fascists who were climbing behind them in order to warn our people in time, and many times they were involved in the subsequent roundup. After the combats, the retreating partisans were not always able to take those seriously wounded with them. If there were too wounded to hide, the couriers remained to watch them, to give them the necessary treatment, to seek medical help, to organize their recovery in a clinic. It often happened that after the battle the courier remained at her post in the occupied country in order to learn the enemy movements and to get the information to the partisan command. During the transfer marches they were in the vanguard: when the partisan unit arrived near a town the courier was the first to enter in order to find out if there were enemy forces and how many there were, and if it was possible for the partisan column to continue on. During the overnight and rest halts the couriers went about the town in search of food, of medicines, and of whatever else was needed. Indefatigable, constantly in motion day and night in order to establish a liaison, to seek information, to deliver an order, to transmit a directive; often in the tiny envelope that the courier hid in her breast was the salvation, the life or the death of hundreds of men. Many couriers fell in combat or in the course of their dangerous missions. Among others there was: Giuseppina Canna at Premosello August 29, 1944, Erminia Casinghino at Varallo April 24, 1945, Ermelinda Cerruti at Feriolo di Baveno November 19, 1944, Alda Genolle at Cavaglio d’Agnona April 4, 1945, Rosanna Re at Orio Mosso October 4, 1944, Ceonice Tommasetti at Fondotoce June 20, 1944, Fiorina Gottico at Varalla Pombia april 26, 1945, Veronica Ottone at Gravellona Toce November 1, 1944, Maria Mariotti May 16, 1944 at Novara, Anna Rossetti February 22, 1945, Maria Luisa Minardi, Maria Ubezio. The Valsesian and Ossolan formations had as their main collaborators and couriers: Teresa Mondini, attach� in the liaison service, the sisters Dina, Lina and Tersilia Mambrini of Borgosesia, the sisters Maria and Wanda Manfredi of Valduggia, the sisters Wanda and Emiluccia Cann of Borgosesia, the sisters Vitto, Jucci, and Rosetta Caula of Varallo Sesia (nurses as well as fighters); the sisters Caterina, Angela, and Maria Zanotti of Valduggia, Angelo Zenotti’s mamma, and that of Giacomino Barbaglia; Stellina Vecchio of the general command of the Garibaldi Brigades; the schoolteacher of Rimasco Biancaneve di Boleto, Mariuccia of Varallo Pombia, Bianca of Montrigione, Fina Rizzio and her daughter Maria of Praveri, Maria Rioloio of Lebbia, Mariuccia of Cellio and Liliana Fantini of Borgomasero, Maria Teresa of Maggiora, the daughters Rasario and mamma Comoli of Raschetto, Lina of Varallo Sessio and many others.

[2] Particularly precious were the labors of Mariola and Marcella Balconi, indefatigable and courageous sanitary inspectors of the general command of the Garibaldi Brigades. The Garibaldian Command in the Belliese was essentially served by the labor of Lilliana Rosetti for liaison between the zone and regional commands; of Bianca Diodati, Vinca berti, Anna Cinanni and Alba Ferrari for liaison with the general command of the Garibaldi Brigades which had its seat in Milan; of Nella Zaninetti, Aurora Rossetti, Giovanna Vanucci, Terseina Comini, Rita Gallo, Nara Bertotti, Luisa Giacchini, Ughetta Bozzalla, Mercedes Fall, Bruna Giva, Marai lastella, Eva Anselmetti, Bettina Zanotti, Ortensia Nicol�, Maddalena Curtis, Amata Casale, Silvia Berbero, Scintilla Robbioli, Marai Teresa Curnic, Alba Bischetto, for the various units of the Fifth and Twelfth Divisions, Lina Antonietti ensured the liaison with the National Liberation Committee and the civilian authorities. We must also remember Catarina Negro, the old “aunt” of the partisans, who despite her advanced age spared nothing in order to in every way assist the patriots who found in her welcoming home rest, liaison, and deliveries. Alba Spina and Ergenite Gili, among the mist active and daring, first worked with the Biellesa partisan formations, and later passed over to the regional military command. It’s impossible to cite and recall all of their names. We needed the assistance of hundreds and hundreds of them, their initiative, their care and their courage. Medals were given to partisans and fighters, and to intriguers as well; but little or nothing was given to the women of the Resistance. But all those who know them will forever carry in their hearts the memory of what they were; to the couriers, to the nurses, to all the female partisans goes the imperishable affection of the Garibaldini. 1. A. Marchesini Gobetti, Donne piemontesi nella lotta di liberazione, Torino. 2. I ask for pardon from the many brave and deserving ones whose names I’ve forgotten. Pietro Secchia Archive

Pietro Secchia 1948 The Vatican—Bulwark of Imperialism Written: By Pietro Secchia, 1948; Source: For a Lasting Peace, for a People's Democracy! Vol. 2, no. 4; February 15, 1948; Transcribed: David Adams, March 2022. In all capitalist countries the Vatican and the upper ranks of the clergy invariably sided with the conservative and reactionary ruling classes, with the big industrialists, landlords and bankers. The church leaders were always closely associated with fascism in the countries where the terrorist dictatorship of fascism held sway and fully supported and abetted its policy. The Vatican supported Mussolini in Italy, Hitler in Germany, Dolfuss and Schuschnigg in Austria; it supported the fascist aggression against the Spanish people and to this day actively supports Franco’s terrorist regime. From the very birth of the fascist movement in Italy and throughout the twenty years of its domination the Vatican preached obedience to fascism. The Pope hailed Mussolini as “the man, sent by Providence,” gave his blessing to the adventures and criminal aggression of fascism against other nations. It was only when the military defeat of fascism became an obvious and inevitable fact that the Vatican made shift to change its policy, sought to forget its recent past, started looking around for new points of support and depicted itself as a champion of democracy. The double-dealing policy pursued by the top circles of finance capital during the Nazi occupation found apt disciples among the princes of the Church. Until the very last minute the Vatican tried to save fascism from defeat, and upon meeting with failure it did everything possible to secure a compromise peace. After the overthrow of fascism in Italy the Vatican set in motion all levers, material and ecclesiastical, in an endeavour to save the monarchy. Today the entire activities of the Vatican are directed against the popular democratic forces, towards bolstering up the power of the oligarchy of Italy’s industrialists and landlords, towards the realisation of the predatory plans of American imperialism. The Vatican is bitterly hostile to the countries of the new democracy and lends every support to any campaign and provocation against the USSR. What is the explanation for the Vatican’s traditional anti- democratic and reactionary policy? It would be wrong to ascribe it to purely ideological, religious and clerical reasons. The present-day Vatican is, above all, a big financial power. The Pope and the princes are closely linked with the leading capitalist circles throughout the world. Their ties with finance capital, with the banks and the great capitalist powers are so obvious that they cannot be concealed. Nor does the Vatican make any pretence at concealment. “Italia”, the weekly journal of the “Catholic Action” organisation, commenting on the expose of the Church tie-up with industrial and finance companies, contained in Comrade Togliatti’s report to the Sixth Congress of the Italian Communist Party, said: “We fail to understand how the possession of economic wealth can be taken to mean a conjugal union with capitalism? In society, where private property is juridically recognised it is the duty or a juridical body like the Church to possess property in order to realise its aims. The Church and its organisations have concrete problems which are linked with their outer life and which call for a solution ..." This is a frank confession by the hierarchy that the Vatican today represents a powerful financial force. Nor is it surprising therefore that this force is actively collaborating in the reactionary policy of big capital and, in particular, in carrying out the expansionist and aggressive policy of American imperialism. The Vatican is a huge International financial trust. It is well- nigh impossible to assess the exact extent of its investments, especially abroad, since both its real estate and stockholding are in the names of trusted individuals. But Italian economists and financial institutions have collated considerable, although far from complete, data on this question. And the journal, “Herald of Economic Policy”, organ of the Institute of Social Problems, recently published some of the data. In France the “French-Italian Bank for South America,” which prior to the war had a capital of 50 million francs, is the property of the Vatican The bank’s board of directors is in Paris. It has branches in Holland and is one of the bulwarks of fascism in the Argentine. The director of the ”French ,Italian Bank” is the general governor, or more correctly speaking, the minister of finance of the Vatican-Baron Bernardino Nogara who, in his day represented Mussolini in Berlin at the discussions on the Dawes Plan. The Vatican holds 70 per cent of the capital in the Societe Textiles du Nord and a large part of the capital in the Banca Galicienne Manant, not to mention one-third of the shares in the Worms Bank, the leaders of which collaborated with the Germans. It is estimated that the Vatican has a capital of 200 million pre-war francs in the various joint-stock companies in France. In Spain the Church which gives whole-hearted support to fascism, is itself, the biggest feudal-capitalist undertaking. The Jesuits possess vast real estate, especially in Barcelona, Madrid, Santandero and Seville. In Portugal they control the Lisbon Banco Ultramarino which, in its turn, controls concessions and plantations in the Portuguese colonies of Mozambique and Angola. The Vatican’s biggest investments are in America, and especially in the United States. In Buenos Aires the Vatican holds shares the tramway, electric power, gas and water supply companies is a shareholder in the “Mihanovich” steamship company, which has the monopoly of shipping on the River Plate.

In Buenos Aires the Vatican holds shares the tramway, electric power, gas and water supply companies is a shareholder in the “Mihanovich” steamship company, which has the monopoly of shipping on the River Plate. It controls the Spanish-American Bank, with headquarters in Madrid and branches in the Argentine, Brazil and Bolivia. In Bolivia the Vatican owns tin mines, which are exploited by the Guggenheim Trust of New York. (This financial operation was engineered in 1938 by Myron Taylor, at present Truman’s representative to the Vatican.) In Brazil the Jesuits control the main rubber and textile enterprises as well as several weaving and flour mills. In the United States the Vatican has shares or big capital investments in Sinclair Oil, Anaconda Cooper and in a number of other ore mining industries. In the US its interests are mainly represented by the Morgan Bank. Of the religious orders connected with the Vatican, the Jesuits possess vast estates and considerable joint stock capital. From their stronghold in Switzerland, the Jesuits exercise control over the world’s largest electrical enterprises and over the bank of the electrical industry. It has been estimated that the total Vatican joint stock capital in different countries amounts to 3,000 million pre-war lira or the equivalent of 300,000 million post-war lira. But these figures are incomplete. While it is difficult to give an exact estimate of’ the capital investments and the financial connections of the Vatican abroad, its share and that of other church bodies in the general joint-stock capital in Italy has been estimated precisely enough. This is manifested in two forms: a.) control (possession of majority of shares), and b.) participation without control. At the present time the Vatican controls 30 Italian joint-stock companies with a nominal capital of 300 million pre-war lira. These companies include among others the biggest credit companies. By means of its capital investments the Vatican has a finger, in practically every Italian industry, particularly in the electrical, chemical, “metallurgical, textile” and food industries and also in transport. land and insurance societies. Vatican holdings in the second group of enterprises are estimated at more than 250 million pre-war lira. To a considerable extent the economic life of Italy is controlled by the Vatican through some 40 Catholic banks and a hundred “popular banks”, whose total deposits on December 31, 1946 exceeded 400,000 million lira, or considerably more than half of the total national savings. Moreover, as is the case abroad, the Vatican and religious bodies dispose of vast estates in Italy. The value of immovable property in Italy is estimated at 380,000 million lira. The financial might of the Vatican and its links with the world’s biggest companies is proof positive of its connections with the capitalist world. These concrete worldly interests explain the stubborn resistance of the Catholic church to reforms and to any transformation of present-day capitalist society. They are also the real motive of the struggle waged by the Vatican against democracy and against the advance of the popular forces. The Vatican masks its struggle against democracy with the slogan of anti-Communism and the “struggle for peace”. But no amount of camouflage can conceal the real aim of this struggle, the desire to smash the democratic forces, defeat the popular movement, facilitate the return to power of the reactionary, fascist regimes, accelerate the establishment in Europe of a bloc of American satellites, who would be willing toots for provocations against the Soviet Union and the new democracies. Commenting on the danger of a new world war the “France Catholique” magazine stated: “To avoid this conflict it is necessary, above all, to transform Europe into an economic unit and to bring it into an international economic organisation.” The Vatican and the entire church hierarchy gave wholehearted support to the “Marshall Plan” and to similar US imperialist schemes for enslaving Europe and provoking war. Ordinary Catholics do not, and cannot, support this policy of the princes of the Catholic church who are hand in glove with big capital and the ruling clique of American imperialists. Exploited and oppressed by capitalism, the Catholic workers, who bore the brunt of sacrifices and hardships of war, and who were active fighters for freedom and national independence, are conscious of the need to unite with all working people in the united front of peace and democracy. Today, more than ever before, they are conscious that they must struggle for liberation from capitalist bondage and exploitation. They know that the only way they can prevent a return of the fascist past, is by fighting for the new socialist society. Secchia Archive

Pietro Secchia 1944 The Garibaldini Pass to the Offensive First published: La Nostra Lotta, June 1944; Source: I Communisti e l’insurrezione, 1943-45, Editori Riuniti, Roma, 1973; Translated: by Mitchell Abidor; CopyLeft: Creative Commons (Attribute & ShareAlike) marxists.org 2007. The Garibaldini were the Italian partisans affiliated with the Italian Communist Party. The liberation of Rome and the Allied landing in France signal the beginning of the decisive phase of the war. The hour of the end for Nazi-fascism has sounded. To the great offensives of the Soviet and Allied armies must correspond the daring and impetuous offensive of the Italian people. It is highly probable that in the coming weeks other regions of Italy will be the object of military operations of great importance. It is necessary that every Communist be at the head of the struggle. It is necessary that every Communist be ready to cope with the developments of the situation . It is necessary that the Communist organizations know how to resolve – even is they are temporarily cut off from the party center – the problems that the rapid development of such a situation pose and will pose. One sole objective must guide us: passing to the offensive in order to prepare within the struggle the conditions for the national popular insurrection. This means that we want and must develop and activate as much as possible the partisan front; that we must organize large scale systematic sabotage of production, the interrupting of lines of communication, the distribution of the means of transport, of arms deposits, of supplies and fuels for the enemy. This means that agitation, demonstrations, strikes against hunger and deportations must be multiplied and follow one on another in a growing and ever-stronger wave, must uninterruptedly explode, must assume an ever more violent and mass character, must unite in a great general movement so as to lead to the popular insurrection. What counts now is action. It’s not a matter of writing and distributing tracts, of hoisting flags, of holding meetings and making propaganda. Agitation is useful and necessary insofar as it serves to mobilize the Italian people for the insurrection; agitation is useful insofar as it serves to bring ever larger masses to the fight for the liberation of our country and for victory. What counts today is action. It is absolutely necessary that every comrade realize that the essential task today of every Communist and patriot is that of, using all means, attacking the Germans; to attack him from the rear, to break up the railroad lines, to destroy machinery, to sidetrack the trains that transport German troops and material, to delay their arrival. Today the essential task of Communists and patriots is that of impeding the transport of the Nazi-fascist enemy’s troops and arms, of destroying his paths of communication, to blow up his depots. It’s a matter of systematically, at an increasing rhythm, the sabotaging of the enemy’s production. Blow upon blow must rain down from everywhere on the nazi-fascist enemy, to make life impossible for him in our country. These, today, are our tasks if we want to hasten the hour of the liberation of our fatherland, the hour of victory. These are the tasks to be discussed and resolved these days in our cells if we Communists truly want to be at the head of the Italian people in struggle. No, we can’t limit ourselves to applauding and demonstrating for the liberation of Rome, to rejoice at the opening of the second front. The moment has not yet come for demonstrations of jubilation: now is the hour of struggle, the hour of action. We must facilitate, with all our force, with all our means the military actions of the Allies who have come to liberate our territory from the invader. It is our duty, our task to do all we can to see to it that the Allies succeed. These today are the tasks of the Communists, of patriots, and they are truly new tasks. These new tasks, which don’t allow for delay, can only be confronted with a combatant’s spirit, with revolutionary enthusiasm. It is necessary that all comrades, those at the base as well as in positions of responsibility, break with the traditional, bureaucratic, routinier work of every day. It is necessary that all of us feel that there is something new in the world, that the decisive hour has come. The liberation of Rome and the realization of the second front must also signify a turn in our work, must also mean for us the deployment of all our energy. We can’t continue in the humdrum of daily activity, of daily meetings, of the usual weekly cell meetings, of union discussions, of the distribution of newspapers, of the collecting of quotas, of chatting with comrades at work, of eight hours at the factory every day from Monday to Saturday, one week after the other, as if there was nothing new under the sun. No, working in this spirit means working with a wait-and-see spirit, even if you’re against waiting-and -seeing; means doing nothing differently today from what was done yesterday; means ‘waiting’ for the Allies to arrive and liberate us; means abandoning oneself to spontaneity, waiting for things to happen on their own. Today the duty of every Communist and patriot is to abandon the factory, the office, the fields; to take up the gun against the German invader. Today it is the duty of Communists and Italians to plan and organize the interruption of the railway and communication lines of the enemy, to impede, hinder, delay its transport of arms and troops. Today it is the duty of every Communist and every Italian to organize and carry out in the factories, the construction sites and the offices the sabotage of production for the enemy. Every day, every hour, in every factory, in every village, in every neighborhood of the city, in every path of communication something must be done that damages the Nazi-fascist enemy.

Every day, every hour, in every factory, in every village, in every neighborhood of the city, in every path of communication something must be done that damages the Nazi-fascist enemy. Today it is the duty of every Communist to work with the sprit that animates the revolutionary combatant, who completely gives his all, without limits, for the reaching of this objective. Above familiar concerns, above work issues, above personal demands, today the duty is to the fight for victory, the fight to destroy Nazi-fascism as quickly as possible. Not everyone can leave for the front, but the entire national territory should be considered one great front. Every Communist must feel the necessity of the task that he has to perform; whatever task the party has assigned him he should consider it necessary to contribute to defeating the enemy. We must work with the same enthusiasm, with the same spirit of sacrifice, with the same contempt for danger, with complete dedication, deploying all our energy, as if we were at the front. If there are comrades who sleep eight hours a day, they’re sleeping too much; if there are comrades who work punctually and hard eight hours a day behind their machines, who work and produce well for war production, these comrades are not Communists, they aren’t fulfilling their duties; if there are comrades who today find too much time to rest and amuse themselves, these are not soldiers, they aren’t combatants. Those comrades who work in a way as if today were yesterday are not combatants; who pass their lives as if they were in time of “peace,” and not on the eve of the national popular insurrection; who pass their lives at the workshop, the evening with the family, chatting in cafes with friends and then to bed with the wife. Today the supreme duty of a Communist, of an Italian is that of being a combatant at the front and behind the lines, in front of and behind the enemy, in the mountains and in the cities, in the trenches and in the factories. It is absolutely necessary that every day at day’s end every comrade be able to see that he has worked another eight hours to earn his daily bread and enrich his exploiters, but can also say: “ Today I did something to destroy Nazi-fascism, to conquer liberty. Today I dealt a blow to my mortal enemy.” And so work hard, with enthusiasm, feverishly, without bureaucratic delays. Above all have present the tasks which we must today confront. In the current situation it is the task of our organisms to reduce bureaucracy, paperwork, archives, collections of documents to a minimum. Become accustomed to working quickly and resolving problems promptly and not get lost in long discussions. This is not the moment for great discussions, meetings, congresses. Arriving hurriedly at the right moment with a tract, an appeal, a directive, also written rapidly, is better than arriving late with a carefully styled document. Derailing a train of German men and material tonight is worth more than passing the night making up grand projects, fantastic plans to be realized in who knows what future. In particular the most qualified comrades must seek to be ready in the same way as is a combatant before the attack. They must seek to relieve themselves of all ties that are a weight and an obstacle to their action. They must organize their work in such a way as not to be tied to their technical and organizational posts. The must be in a position to be able to leave their cities from one moment to another, to go from one locality to another where their work is necessary; they must be in a position to be able to pass from political work to military work, from agitational and propaganda work to that of commanding a detachment or vice versa, according to the circumstances. It is only by working with a truly practical and revolutionary spirit, only with the dedication of all our forces, of all our physical and moral energies, that we will be able to acquit our tasks of today, that we can maintain the offensive, that we can lead the national insurrection. Pietro Secchia Archive

Vance Archive | Trotskyist Writers Index | ETOL Main Page Frank Demby You Had Better Read This It Tells You How the War Is Going to Affect Your Pocketbook! (December 1941) From Labor Action, Vol. 5 No. 51, 22 December 1941, pp. 1 & 4. Transcribed & marked up by Einde O’Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL). If you own an airplane factory or some other factory producing materials needed for the prosecution of war, you may make a lot of money. If you own a lot of stocks and bonds, you may also make a lot of money. If you own some choice real estate, you may find it going up in value. In short, if you are a capitalist you may find that war CAN be profitable to some. But you must be a big capitalist. The small capitalists – the little business men and farmers – probably are going to be wiped out. Since, however, the vast majority of the population of these United States are workers, people who work for a living, let us examine, on the basis of past experience, what has been happening in other countries and what seems most likely to happen here: how your pocketbook will be affected by the entry of America into World War II. * Guns, Not Butter “Guns – not butter.” This is the slogan that Hitler used to launch his so-called four-year plan in 1936. This was, in reality, his declaration of war to the world – a declaration that German imperialism was dissatisfied with its secondary position and was going to demand its “real place in the sun.” For the German workers, who already had had their trade unions smashed, their democratic rights violated, their leaders slaughtered and tortured in the concentration camps, there now began a period of unimaginable slavery. Hours of work were lengthened to at least 10 hours a day, and in many armament industries to 14 hours a day. Wages remained stationary while prices began to creep up – not very much because the totalitarian government controlled them, but still enough in the case of essential products, like potatoes, to hurt. Then came the taxes and the “voluntary” contributions. On top of these came the ration cards, which meant one egg a week, when you were lucky, a half pound of meat and similar starvation rations. To make matters worse, most of the commodities that could be obtained were more and more of the “ersatz” variety – miserable substitutes that didn’t even take away the pangs of hunger or protect the body or the home against cold winters. Labor Conscripted Malnutrition, disease, poverty became the daily lot of the German worker. Finally, the insatiable war machine demanded not only cannon fodder in various parts of Europe and Africa, but it demanded workers. Even Hitler, powerful as he is, cannot ignore the fact that without workers nothing can be produced – not even armaments. So the German workers were conscripted to work in any part of the country. And not only the German workers, but a recent estimate shows that at least 2,000,000 foreign workers, French, Spanish, Italian, etc., have been conscripted to work in German war factories. Forced labor is slavery, as the German workers and the workers of the countries conquered by Germany have discovered. But war is still profitable for some. While the German workers have been starving, they have been watching the big bosses, the Nazi bureaucrats, government officials and leading manufacturers still getting fat on rich foods while the workers have been living in homes calculated to give pneumonia even to the strongest, they have had to watch their leaders living in palaces and thriving in relative opulence. Pretty much the same story has been true in England. There the workers not only had to shiver in the subways during the air raids while the big bosses retired to well constructed bomb shelters that took on the appearance of night clubs, but they also had to suffer the indignity of working and slaving and starving while the rich lived off the fat of the land. Our returning travelers from England, the congressmen and college professors, love to expatiate on the new spirit of “equality” in England, of how everybody is made equal by the ration card and huge taxes, but they always forget to mention or slide over in silence the scandalous fact that if you have a large pocketbook, you can still get all the good things in life. For there still flourishes the “black market,” the illegal paradise of the speculator and profiteer, where, for a price, you can buy as many chickens as you want. Very Low Living Standards It has been estimated – and these are very, very conservative estimates – that the standard of living of the average German worker today is well below what it was in 1932 at the worst point of the depression. In England, it has been estimated that the standard of living of the average British worker has declined by one-third since the outbreak of the war. The chances are it is nearer one-half. This is the picture of every country at war. It is as true of Japan, or Russia as it is of Germany and England. Will it also be true of the United States? Judging by what has happened under the defense program and by what the new Victory program calls for, there can be no doubt that the answer is “yes.” That is, as long as the industrialists and bankers are allowed to run the war, it is bound to be the same in this country as in every other country. The masses will suffer – a few will profit. After all, if everybody suffered from war, what sense would there be in having war? It is the fact that some profit and others hope to profit that makes war possible. Assuming, then, that the dollar-a-year men remain in charge of our war effort, that the brass hats keep making their incredibly stupid mistakes, let’s see how the picture shapes up. First of all, this is going to be a long war. That we have already been warned about. Plans are now under way to build up an army of 7,500,000 men. It may easily reach 10,000,000 before the war is over.

Fifty per cent of our production will go to the war. It may easily be 60 or 70 per cent before the war is over. All men between the ages of 18 and 64 are to be registered. This may easily be extended to include women. Shortages have already appeared in such key raw materials as rubber, tin, gasoline, etc. These will be rationed. It may be and will be extended to others. Prices in the vital wholesale markets have gone up more than 60 per cent since the beginning of the war. They will go up further. Cost of Living Jumps Here, Too! The cost of living has gone up, according to government estimates, 11 per cent since the outbreak of the war. It will go up much, much further. There is an acute shortage of labor, particularly semi-skilled and skilled labor for the war industries. Other countries have drafted labor. The probability is that along with the outlawing of strikes there will come the conscription of labor in the U.S. – in spite of the fact that conscripting labor to work for the gain of a private employer is outlawed by the 13th amendment to the Constitution as slavery. Goods are being standardized. This will continue and be extended to everything – that is, to everything except war materials. People are being urged to buy defense bonds and stamps. Soon they will be forced to buy them, as is already happening in some cases, “in the best interests of the workers,” simply deducting a certain sum from each worker’s pay check to go for this or some other type of forced savings. Substitutes are being introduced. This will be extended. This picture is hot that of an alarmist. It is a very sober picture based on historical fact. The picture could be extended almost indefinitely to cover every last detail. The broad outlines are quite clear for anyone with eyes to see. But while the workers and masses are suffering a steadily declining standard of living, the same picture of the rich profiting by the war as exists in other countries will be duplicated here, only more so. Profits have gone up tremendously. They will still go up. Top of page Vance Archive | Trotskyist Writers Index | ETOL Main Page Last updated: 26.2.2013

Vance Archive | Trotskyist Writers Index | ETOL Main Page T.N. Vance The Economic Outlook for 1954 The Administration’s Anti-Recession Program (March 1954) From The New International, Vol. XX No. 1, January–February 1954, pp. 8–10. Transcribed by Ted Crawford. Marked up by Einde O’Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL). The economic outlook for 1954 has now become the dominant question, governing all political forecasts. While it is still eight months to the Congressional elections in November, there can be little doubt that the Republican politicians are worried lest an unfavorable economic outlook accentuate the normal loss of Congressional seats that the party in power must usually expect a non-presidential election year. The result could easily be that the Democrats will capture a solid majority in both Houses of Congress. Certainly, if unemployment in November exceeds present levels – barring an all-out hot war – the Republicans will suffer a resounding defeat. Just what the present (March) level of unemployment is – the month Eisenhower stated would be decisive in determining whether the Government would intervene in the economy – is impossible to say. The January figure exceeded 3,000,000. The February figure should have been released on March 1st. Publication has been postponed until March 15th. Why? Ostensibly to permit checking of the new sample used to estimate the amount of unemployment. It might also be that the February figure shows unemployment to have risen sharply. Politically, it may be more convenient to announce a February unemployment figure of 4,000,000 or thereabouts at the end of March, while (the administration most hope) advance indications show a decline in unemployment for March. The Economic Report of the President to Congress, dated January 28, 1954, concludes its evaluation of the current economic outlook by stating: “Our economy today is highly prosperous, and enjoys great basic strength. The minor readjustment underway since mid-1953 is likely soon to come to a close, especially if the recommendations of the Administration are adopted.” (Italics mine – T.N.V.) Actually, the “minor readjustment” is a full-fledged recession, already amounting to a decline of approximately 10 per cent since it began in the second quarter of 1953. The overwhelming majority of economists attending the annual meetings of the American Economics Association and the American Statistical Association at the end of December is clearly of the opinion that “The United States economy already is in a downturn. It faces the prospect of an ‘orthodox recession’ in 1954 with total output down $10,000,000,000 to $18,000,000,000 from 1953’s extraordinarily high levels.” (The New York Times, Dec. 29, 1953.) While the American economists do not share the opinion of Colin Clark, leading Australian economist, that the economy is heading for a severe depression, they do appear to expect the decline to last throughout 1954. In other words, the professional economists will be surprised if the “re-adjustment” ends “soon.” As a matter of record, the Joint Committee on the Economic Report (officially established by Congress to appraise the President’s Economic Report, and composed of a majority of Republicans) is quoted in the New York Times of February 27, 1951 as “not fully satisfied with the Government’s anti-recession program, and (it) finds the administration’s farm program particularly unsatisfactory.” Just what is the administration’s “anti-recession” program? It was supposed to have been stated explicitly and at length in the President’s State of the Union Message, the Budget, and the Economic Report. By and large, the Eisenhower anti-recession program consists of three parts denial that a recession exists and one part piously wishing that it would go away – if it does exist. These three major policy documents can be searched from beginning to end, and any anti-recession program will he found conspicuous by its absence. There is discernible an anti-New Deal philosophy, typically expressed by the following paragraph from the Budget Message: “This budget marks the beginning of a movement to shift to State and local government and to private enterprise Federal activities which can be more appropriately and more efficiently carried on in that way. The lending activities of the Reconstruction Finance Corporation; the services provided by the inland Waterways Corporation; certain agricultural activities; and some aspects of our health, education, and welfare programs are examples of this type of action.” Nevertheless, there is an administration program. Officially, it can be summarised as providing tax incentives and other necessary stimuli to capital investment. Unofficially, it might he called Turning the Country Back to the Indians (read: Monopoly Capital) or How To Loot the Public Treasury in Three Easy Lessons. Whether it be reducing the taxes on dividends, or more rapid depreciation allowances, or other fiscal policy, the philosophy stems from the theory that what is good for big business (General Motors and its allies) is good for the country. Much of the theoretical foundation for the administration’s program apparently originates with Arthur F. Burns, Chairman of the Council of Economic Advisers, who is interviewed in the New York Times of Feb. 22, 1951 by Joseph A. Loftus on the occasion of the publication of a collection of Burns’ essays. The heart of the Burns philosophy is revealed by the following exchange: In an essay written in 1948, he made this observation about Government policy in the depression of the Nineteen Thirties: “On the whole, consumer spending responded much better to the Governmental measures than private investment.” How, then, could he justify an Administration tax policy now that puts emphasis on incentive to private investment rather than on consumer spending?

The circumstances were quite different then, he explained. The present tax program would have made no sense whatever in the early days of that depression. Business confidence was shattered. Now it is different. Stock prices are up, commodity prices are not down. Investment expenditures are being pretty well maintained. Business confidence is running high. There is a good chance of stimulating investment further. As the question is being stated – “do you want to stimulate consumption or production?” – Dr. Burns continued, the “underconsumptionists” would win. But, he said, that does not state the issue correctly. As the facts are now, he said, if you cut a consumer’s tax $1, he may spend from zero to $1, no more. If you cut business taxes $1, business may spend as much as $50. A new environment for business spending is created. If business confidence is high, why is there need to stimulate it? There has been a decline, he said, adding that no responsible thinker can say positively it will be self-limiting. It could become a spiraling contraction. (Italics mine – T.N.V.) Just what good it would do to stimulate capital expansion, when the source of the present recession is the crisis in agricultural production and in certain consumer durables, especially automobiles, is not explained by Dr. Burns, for he has yet to ask himself (publicly) what is the cause of the present decline? And yet, according to Loftus, in the above-quoted article: “This is some of the thinking of the man who probably does more to shape the economic policies of the Administration than any other individual except the President.” Whether it is a better understanding of economics, or a keener political sense that is responsible, the Democrats have dramatically focused attention on the Administration’s pro-Big Business orientation by the proposal of Senator George that income tax exemption credit for dependents be increased from the present $600 to $800 and then, next year, to $1,000. Such a proposal, of course, would benefit the mass of the population and would serve to stimulate consumption. Although the administration has officially come out against the George proposal, Congressional Republicans are uneasy about entering an election campaign with unemployment at the four or five million mark, and with the Democrats pushing tax relief for the masses while the Republicans are committed to tax relief for finance capital. That is why the Joint Committee on the Economic Report, mentioned above, is quoted as saying: “Tax relief for the middle and lower income brackets, to bolster consumer demand, might be desirable sooner than President Eisenhower has indicated.” And further: “Better preparations for a public works program are necessary; there should be a public works administrator, responsible directly to the President, and substantial credit should be available to local communities for such projects.” (Italics mine – T.N.V.) Shades of WPA and PWA! The Loftus interview with Burns concludes by quoting from one of Burns’ essays: “Subtle understanding of economic change comes from a knowledge of history and large affairs, not from statistics or their processing alone – to which our disturbed age has turned so eagerly in its quest for certainty.” To which we say “Amen!” Such understanding, however, cannot be found in Burns or in the Eisenhower administration. T.N. Vance March 7, 1951 Top of page Vance Archive | Trotskyist Writers Index | ETOL Main Page Last updated: 26 April 2019

Vance Archive | Trotskyist Writers Index | ETOL Main Page Frank Demby Arming for Boss War (November 1940) From Labor Action, Vol. 4 No. 32, 18 November 1940, p. 3. Transcribed & marked up by Einde O’Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL). Who Pays? “We have just begun to rearm. There must be a higher debt limit and new taxes.” So said Secretary of Treasury, Mr. Morgenthau, two days after Roosevelt was re-elected for a third term. Conservative estimates indicate that the government will spend at least 20 billion dollars during the next year and a half. This is a lot of money, no matter how one looks at it. It amounts to about 30% of the of the current national income. We know how Germany is financing the war – by increasing the working day to 12 and 14 hours, speeding up labor, higher taxes that fall most heavily on the masses of the people, by looting the occupied territories through a system of scientific stealing – in two words, by a system of forced labor. A totalitarian regime is well equipped for this method. The institution of an extremely rigid type of capitalist slavery is the fundamental reason why fascism came to power. The Lesson of England How is the war financed in England, a democratic capitalist country? Does England, which claims to be fighting a war for democracy, finance the war in a more democratic way possible, by having those most able to pay for themselves cost of the war (about 36 million dollars daily)? Are the standards of living of the English masses maintained? the answer is very definitely, no! The London Economist’s index of British prices on Nov. 5, 1940 was about 42% higher than at the outbreak of the war. In spite of higher taxes, the British capitalist is finding the war very profitable, aside from those whose plants have been destroyed by bombings – and these will probably be reimbursed by the government. Conservative bourgeois sources indicate that the average standard of living of the British worker (aside from those rendered homeless by bombings) has declined about one-third since the outbreak of the war. In both England and Germany, the masses are bearing the burden of World War II, thus destroying a lot of the fake pretexts given for the war. Must we expect the same sort of thing in this country? The opinion of London financial circles is very interesting, in view of the experience the British have had with this problem. “It is felt,” says a dispatch to the New York Times, dated Nov. 10, “that the New Deal policies will be pushed into the background by more urgent requirements of rearmament and even larger United States backing for the British war effort. It is remarked by commentators in the financial press that the urgency of the production drive entails on Mr. Roosevelt the necessity of treating big business more gently than hitherto.” Workers Will Pay Comment on this is really superfluous. The British capitalists need not fear for their American brethren. Roosevelt does not need their advice. He has already taken the necessary steps to make sure that the American workers pay for the cost of rearmament. When the “defense” program was first projected earlier this year, Roosevelt indicated very clearly how he was going to handle the problem of paying for the cost of the program by broadening the base of the income tax, so that those in the lower income brackets, who have hitherto been exempt, will now pay an income tax. The rates have been stepped up so that the workers and lower middle classes will pay proportionately much more than previously. Special “national defense” taxes were levied on amusements, movies, gasoline, liquor and tobacco, which, of course, fall most heavily on the masses. Government employees will pay both a state and federal income tax. Now that the election is over, the program is unfolded in all its reactionary splendor. Most of the money, it seems, is to be raised by increasing the national debt limit to $60,000,000,000 (it is now 45 billions). This, as Wall Street correctly interpreted, is a measure with inflationary tendencies. “I have no fear of inflation now that President Roosevelt is back,” says the eminent Secretary of Treasury, but just why Roosevelt should be any better able to prevent rising prices than Churchill, he does not indicate. Without the introduction of prices, which mean a lower standard of living for the masses, are inevitable. The Tax Swindle It is also indicated that a small portion of the money will be raised by new taxes. I have already indicated in a previous article, that the excess profits tax is a swindle and will raise very little. What new taxes are meant? The only one indicated is a proposal to tax government bonds, which are now tax exempt. This explains why the banks and big corporations have been getting rid of their government bonds during the past few months. Some money will undoubtedly be raised by this method, but we can expect that it will be chiefly through another Liberty Loan campaign, which means that the lower middle classes and higher-paid workers will bear the brunt of the patriotic salesmanship pressure. Other taxes, since present measures are obviously inadequate to cover the cost of the program, will most likely be forthcoming. Our experiences to date, however, indicate that it is “we, the little people,” who will pay for them. Since the squeeze on the government’s finances will become tighter and tighter, no matter how much the normal revenue from taxation is increased due to a higher national income, we can expect also that very shortly Roosevelt will begin to listen to Senator Byrd and others who propose that “we should at once economize on non-essential peacetime spending.” By “non-essential” spending, these people, of course, mean WPA, slum-clearance and the like.

Since the squeeze on the government’s finances will become tighter and tighter, no matter how much the normal revenue from taxation is increased due to a higher national income, we can expect also that very shortly Roosevelt will begin to listen to Senator Byrd and others who propose that “we should at once economize on non-essential peacetime spending.” By “non-essential” spending, these people, of course, mean WPA, slum-clearance and the like. As long as Roosevelt refuses to make those who can afford to pay for the “defense” program, it’s a cinch that the workers and broad masses will bear the brunt of the rearmament program. And why, indeed, should it be any different here than in England or Germany? Who Profits? “The profits of twenty-eight steel companies for the first nine months of 1940 were $169,919,408, compared with $54,606,254 in the same period in 1939, despite the fact that tax appropriations for the current year were virtually double those in the comparable period. The increase amounts to 211% for the nine months.” The above quotation, from an article in the financial section of the New York Times on Nov. 10, gives the answer to our question. It merely gives actual figures for a generally-observed situation. Business is booming. Production levels will probably exceed 1929 levels for 1940. Profits will be very close to 1929 profits. It is estimated that profits for all industry will reach the total of 10 billion dollars in 1940. (Why not just take all of this – if rearming is what the bosses want!) America has definitely entered upon an armaments boom, which will be much, much greater during 1941 than even during 1940. The only difference between the present boom and the 1929 boom, aside from the fact that an armaments boom is never very sound or lasting, is that most of the big profits are made by even fewer of the big corporations. In the case of the steel profits cited above, for example, 12 steel leaders made net profits of $157,341,000 during the first nine months of 1940. The other 16 steel companies made only 12½ millions – enough to keep the wolf away from the door, but chicken feed compared to the money made by U.S. Steel, Bethlehem, Republic, Weir’s National Steel, and the other big steel corporations. Prosperity for Rich The same story is true in auto, rubber, oil and the other mass production industries. Prosperity has arrived for America’s 60 families and their friends. Chemical, aviation, shipbuilding and munitions factories are working 24 hours a day. Orders are piled up for a year or two in advance. And most of this increase in production is being accomplished with relatively little increase in the number of workers hired. The investments in plant and equipment are so large that most of these industries will pay hardly and excess profits tax. Anti-trust laws and prosecutions against big business monopolies are being suspended in the interests of “national defense.” Labor’s Opportunity Here it would seem, lies the big opportunity for America’s trade unions, especially the CIO, which has most of the unions in the mass production industries, to demand substantial wage increases. Industry cannot justifiably raise the argument that it cannot “afford” higher wages and better working conditions. The figures show otherwise. Moreover, in spite of the organization drives of the CIO, these industries are still largely unorganized. Those that are organized, however, are making just as big profits as those that are unorganized. Just compare U.S. Steel, which is organized, with Bethlehem and Little Steel which are unorganized. Or, General Motors with Ford. Or, the independent oil companies with Standard Oil. This is labor’s big opportunity. Failure to take advantage of it, however, will mean not only the death of certain unions, but it will mean that big business with its reactionary social program, will be more firmly in the saddle than ever. Wartime prosperity has, in the past, usually been accompanied by increased labor organization and the growth of the trade union movement. But that was in the period of expanding capitalism. The present period, in spite of the war-time boom, is a period of declining capitalism. The bosses will fight even more desperately, therefore, against any attempts at organization by labor. The union movement, under pressure from the unorganized workers and the rank and file of labor, in general, will be compelled in the interests of self-preservation to widen and strengthen its efforts at organization. It will run smack up against the cry, “If you strike, you are interfering with national defense.” And this, at a time when big capital is writing its own ticket as to the terms on which it will cooperate with the rearmament program. The battle to organize the mass production industries, especially the key “defense” industries like aviation, chemicals, munitions and ship-building, will, through its outcome, determine in large part the future of this country. If the unions fail to measure up to the responsibility that is theirs, even such labor standards and unions as exist now will be destroyed. If, on the other hand, the unions succeed in defending and advancing the basic economic rights of labor, then we will have taken a long step forward in the struggle to maintain our elementary rights, and, ultimately, to advance towards a socialist society. Top of page Vance Archive | Trotskyist Writers Index | ETOL Main Page Last updated: 28.10.2012

Vance Archive | Trotskyist Writers Index | ETOL Main Page Kenneth MacKenzie & T.N. Vance An Exchange on Nationalisation A Discussion of Government Ownership of War Industries (March 1952) From The New International, Vol. XVIII No. 2, March–April 1952, pp. 108–111. Transcribed by Ted Crawford. Marked up by Einde O’Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL). To the Editor: Your publication continues to be one of the few things I read that consistently makes sense. It is only because I like you that I would venture a little disagreement. T.N. Vance ends his brilliant series on the was economy with what seems to me too great an emphasis on the proposal – “Nationalize the War Industries.” He says this must now be the chief slogan of socialists, and gives it special place among the other transitional slogans as corresponding to the needs of the workers and the times. But how does it actually fit in with our other demands and our philosophy? The paid thinkers of the rich like to equate socialism with any build-up in the authority of the state. But we have learned to our sorrow that the equation is false. The most nationalized state in existence is the least social, the least beneficial to man. There exists no economic law to guarantee that as economic power is taken from individual companies or combines of companies and put in the hands of a government, it thereby is any easier for the working class to control and apply to pro-human ends. Many workers who now find it easier to deal with private employers would consider it is calamity for the government to operate all big industry. If carried into effect, nationalization, unlike the other transitional demands, might not stimulate worker power as opposed to owner power. The sliding scale, though distorted by the employers, has raised a great issue and exposed the administration’s wage-price fakery. With the “books” once opened, things would never again be quite the same. Worker’s control, worker’s defense, these things build the confidence of the class and instruct and educate workers to take further responsibilities. But putting all economic power in Washington, even under an administration of labor leaders, still leaves open the possibility of transition from a capitalist to a bureaucrat state. And compensation to former owners may eat up the economic benefits. So it seems to me that we should support nationalization if in time of crisis the American working class desires to take this road as have the English, Germans, etc., but not make it an unqualified fundamental issue at any and all times. Sincerely yours, Kenneth MacKenzie Top of page Reply by Vance Kenneth MacKenzie is, of course, absolutely correct when he observes that nationalization in and of itself is not necessarily progressive – and may well be reactionary in its impact on society. The lessons of Stalinism – not to mention other examples of nationalization – are too clear on this basic lesson of modern history. Nevertheless, nationalization of war industries is the correct political slogan for socialists today. It is not put forward in the abstract, but could only become meaningful through mobilization of powerful class and social forces. It is not to be contrasted with Workers Control of Production; on the contrary, the latter supplements the former. It was not possible at the conclusion of my last article on the Permanent War Economy to expand on the development and interrelationship of tactical political slogans. Nor was it necessary. The essential thought was contained in one sentence: “Neither nationalization of war industries nor a capital levy are thinkable as realistic political slogans without the development of an independent labor party.” In the political context of USA 1952, nationalization of war industries is the only economic slogan that corresponds to the objective needs of the political-social situation. The stretch-out in the “Defense Program” has dramatically revealed the weaknesses of the Permanent War Economy under capitalism. A process of atrophy, revealing an organic disease of the body economic, has set in. The ratio of war outlays to total production required to sustain the economy at full employment and high production levels is constantly under pressure of having to be increased. Immediately after World War II a 10 per cent ratio of war outlays sufficed to offset the natural tendencies of capitalism toward depression and crisis. After Korea, with its consequent acceleration in the accumulation of capital, a 15 per cent ratio of war outlays barely achieved a precarious equilibrium. Today it may well be that a 20 per cent ratio of war outlays (direct and indirect) to total output is needed to prevent a serious undermining of the economy. On the economic front, war contracts become more and more desirable to the bourgeoisie. Production of the means of destruction. is now at least as important as production of the means of production in the capitalist process of production and accumulation of surplus values. And on the political front, the preparations for war against Stalinism dominate the international and American political scenes. Virtually every issue that arises is immediately related to the irrepressible conflict between Stalinist and American imperialisms, if indeed it does not arise out of this conflict. One cannot imagine Eisenhower, Taft, Stevenson, Truman, or any spokesman for the Republican and Democratic parties favoring the nationalization of war industries. That would immediately generate fratricidal strife within the bourgeoisie. Nor, for that matter, can one readily picture Murray, Green or any other trade union defender of capitalism advocating taking the profit out of war through the nationalization of war industries. That would immediately lead to a split between organized labor and the capitalist political machines. The. trade union leaders would consider such action only if the ranks of organized labor make it unmistakably clear that they are for it. An entire process of class struggle and education is therefore necessary before any but the most militant workers support the nationalization of war industries. In this struggle socialists must be in the forefront, for here in one, easily comprehensible slogan the evils and illnesses of capitalism are immediately laid bare. If the Permanent War Economy is to become our way of life indefinitely, as the leaders of the bourgeoisie openly state, then what is more logical than making the war industries serve the “interests” of all by making them the property of all? We do not have to belabor the advantages of the slogan, “nationalization of war industries” properly utilized. Moreover, we may well be on the threshold of the long-heralded regroupment of American political forces. It is impossible indefinitely to maintain an archaic political set-up that no longer serves the needs of the ruling class and has long since lost any meaning for the mass of the population. The timid leaders of labor may well be immobilized by the shifting political forces. They may even be unaware that structural alterations are taking place in the body politic. But when they are, so to speak, “hit on the head” – as they must be in the course of the next few years – then they may awaken to the fact that the American political trend must either be in the direction of Bonapartism or independent labor political action. In such an objective situation (not “at any and all times”), the struggle to nationalize the war industries can play an important role in the political awakening of the American working class. Socialists ought not to wait for the working class spontaneously to “desire to take this road (of nationalization of war industries).” They should and can lead the workers in a rapid and vast re-educational process. That is the real significance of putting forward the slogan “nationalization of war industries” to-day. T.N. Vance Top of page Vance Archive | Trotskyist Writers Index | ETOL Main Page Last updated: 15 December 2018

Vance Archive | Trotskyist Writers Index | ETOL Main Page T.N. Vance The Permanent War Economy (1951) From New International, Vol. XVII Nos. 1–6, 1951. Transcribed & marked up by Einde O’Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL). Part I – Its Basic Characteristics Part II – Declining Standards of Living Part III – Increasing State Intervention Part IV – Military-Economic Imperialism Part V – Some Significant Trends Part VI – Taxation and Class Struggle Top of page Vance Archive | Trotskyist Writers Index | ETOL Main Page Last updated: 16 August 2019

Vance Archive | Trotskyist Writers Index | ETOL Main Page Frank Demby And the Price of Food Will Go Up! (August 1941) From Labor Action, Vol. 5 No. 33, 18 August 1941, pp. 2 & 3. Transcribed & marked up by Einde O’Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL). The first witness to testify before the House Banking and Currency Committee concerning the Price Control Bill was Leon Henderson, administrator of the Office of Price Administration and Civilian Supply. When Mr. Henderson got to the question of agricultural prices, he was questioned about the reason for the bill containing the provision that the ceiling on farm prices be 110 per cent of parity instead of the Administration’s long-sought goal of 100 per cent of parity. While Mr. Henderson hesitated and looked toward Chairman Steagall, who took credit for this change in a press interview. Representative Ford of California interrupted: “I answer – votes.” Never was a truer word spoken by a congressman. All the legislation in regard to the economic controls to be established under the war economy has been subject to an old-fashioned log-rolling process. But the provision for 110 per cent of parity on farm prices represents one of the greatest triumphs the congressional farm bloc has ever scored in long years of pressure politics and, by the same token, a tremendous blow at the standard of living of the vast majority of the working population of this country. The Background To understand what is involved, we must first briefly consider the meaning of “parity” and the situation of the farm population, particularly as affected by World War II. Parity, according to the dictionary, means equality. The word first came into prominence during the 1920s when farm lobbyists and farmers’ organizations, especially the Farm Bureau, an organization representing the more well-to-do commercial farmers, used it to describe their goal for farm recovery. The farmers of the United States, for a series of historical reasons, had entered into an era of permanent depression following World War I. The Armistice of 1918 left them with terrific surpluses on hand, particularly in the staple crops, wheat and cotton. The colonial areas of the world – Canada, Argentina, Australia, Brazil, India, Egypt – had greatly increased their production of these commodities under the stimulus of war-time demand. Cheaper production in these new territories and imperialist trade rivalries meant the steady loss of foreign markets for the American farmer. While more clothing, bread and other necessities which are made from farm products could easily be used by the American population, this is not possible under capitalism to any great extent. For capitalism means an economy of scarcity and insufficient purchasing power in the hands of the vast majority who produce the wealth of this country – the workers. Consequently, the prices of farm products began to decline. Meanwhile, the prices of industrial products (the things the farmer must buy) either remained high or went higher. As a result, the purchasing power of the farmer’s dollar went down steadily. The farmers wanted more purchasing power; that is, they wanted higher prices for farm commodities in relation to the prices of industrial products which they had to buy. They said they wanted equality between farm prices and industrial prices. Hence, the slogan of “parity.” But – and here is the vital question – what period should be selected as an example of parity, of the proper relationship between farm and industrial prices? The farm organizations examined the government’s statistics and selected the period from 1909–1914 as “normal” for the relationship between farm and industrial prices. “Normal” or “Abnormal”? What is meant by “normal” is always, of course, a difficult question to answer. The fact of the matter is, however, as any examination of price statistics will show, that the period from 1909–1914 represents the highest possible parity base which could be selected in the 20th century. It is distinctly an abnormal period, if by “normal” we mean what is most usual or typical. The period from 1909–1914 represents an extremely prosperous period for farmers. This applies, to be sure, only to the capitalist farmers; but the whole discussion of parity prices is only concerned with the relatively well-to-do capitalist farmers, representing at the most some 35 per cent of the farm population who produce 89 per cent of the total value of all farm crops which are marketed. The majority of the farmers who live in real poverty and distress, the tenant farmers, share-croppers and agricultural laborers, are certainly not the concern of the congressional farm bloc, for parity cannot help them. Only a fundamental change in the economic system and a redistribution of the land can improve the status of these truly forgotten people of America. The first attempts to achieve parity under Coolidge and Hoover were miserable failures. They are important only as confirmation of the necessity for government intervention in solving the problems created by a declining capitalist order. The onset of the great depression of 1929 only made matters worse tor the farmers. In 1933 came the New Deal, promising all things to all men.

In 1933 came the New Deal, promising all things to all men. Recognizing the strategic situation of the farm bloc in Congress and the great voting strength of the farm states, the New Deal political strategists promised parity to the farmers. Their first effort, the Agricultural Adjustment Act of 1933, was a colossal blunder and a crime against humanity. They tried to raise the prices of farm products by ordering the farmers to plow under every third row of cotton and wheat – at a time when millions were going ragged for want of clothing and starving for want of food. The slight increase in farm prices which followed was largely due to the subsequent droughts. The only important result of this first New Deal attempt to solve the farm problem was to strengthen the farm bloc in Congress. The farm bloc was now in the position of being able to blackmail the Roosevelt Administration on any important measure that it wanted to pass. Time after time, the farm bloc, in return for votes supporting the general Roosevelt program, received important concessions in the form of desired subsidies to the CAPITALIST farmers. It has been horse trading on a grand scale. World War II The failure of the Roosevelt farm program was emphasized by the election of 1936, which showed the farm belt clearly swinging away from the Democratic Party back to its traditional Republican allegiance. This called for heroic measures, and finally resulted in the passage of the AAA of 1938, which incorporates the goal of parity into existing legislation. Nobody quite knew how this goal was to be achieved, but the act, sometimes referred to as the Omnibus Act, contained every possible scheme that capitalist politicians could think of. It was rapidly being demonstrated a failure, in spite of the addition of the Food Stamp Plan, when, in September 1939, World War II broke out. The immediate effect of World War II on the farmers was the reverse of World War I. In World War I, when Europe turned its fields into human slaughter houses, the Allies bought huge quantities of farm products in the U.S. This time, however, the newly developed colonial areas of the world could more than supply the needs of England and France. Moreover, the Allies, particularly the English, found it necessary to conserve their cash for the purchase of American munitions and planes. England actually reduced its normal purchases of cotton and tobacco from the U.S. As a consequence, the government warehouses have accumulated huge surpluses of the staple crops. The situation has been farther aggravated by the so-called “Hemisphere Defense Policy.” In the long run, this means that American imperialism will import agricultural raw materials from Latin America (products like wheat, cotton, meat, hides and copper, which, far the most part, compete directly with the American farmer) in return for its exports of capital and industrial commodities. The pressure from the farm states to relieve the situation grew tremendously. Every step of the Roosevelt war program, in order to pass Congress, has had to be accompanied by concessions to the farm bloc. Meanwhile, the expenditure of billions of dollars for war by the government has had an inflationary effect on all prices, particularly farm prices. Mr. Henderson, in his testimony, stated the following percentage relationship of farm prices to parity as of July 15: rice 102, cottonseed 120, butter fat 112, milk equivalent 102, chickens 111, eggs 100, hogs 106, beef cattle 127, veal calves 114, lamb 117, Maryland tobacco 188, wool 149, corn 81, wheat 73, oats 62, and cotton 87. THE WHOLESALE COMMODITY INDEX OF THE BUREAU OF LABOR STATISTICS SHOWS THAT FOOD PRICES ARE RISING EVEN FASTER THAN THE GENERAL LEVEL OF PRICES – WHOLESALE FOOD PRICES HAVING RISEN ABOUT 60 PER CENT SINCE THE OUTBREAK OF WORLD WAR II. Price Control Bill Under the terms of the Price Control Bill, as introduced in the House of Representatives, agricultural prices will have a ceiling 110 per cent of parity – that is, 10 per cent more than the farm propagandists ever dared to demand. From the figures quoted by Mr. Henderson, it will mean a tremendous increase in the price of most of the important food and clothing items in the worker’s budget. Moreover, those prices which are above parity as of July 29 will have this higher level maintained as an alternative price ceiling. The price of meats, for example, will remain at the present extremely high levels. On the average, therefore, the workers are confronted with a bill whose avowed purpose is to prevent higher prices and inflation, but which will guarantee a 20 PER CENT INCREASE IN PRICES. Moreover, it is only the wealthy farmers and big middlemen who will benefit from this handout at the expense of the workers and the poor farmers. All of which only serves to emphasize once again the extreme injustices of the capitalist economic system, particularly in wartime, and the absolute necessity for workers’ control of price-fixing. Top of page Vance Archive | Trotskyist Writers Index | ETOL Main Page Last updated: 13.1.2013

Vance Archive | Trotskyist Writers Index | ETOL Main Page T.N. Vance After Korea – What? An Economic Interpretation of US Perspectives (November 1950) T.N. Vance, After Korea – What?, New International, November-December 1950, pp.323-333. Transcribed by Ted Crawford. Marked up by Einde O’Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL). While the outcome of the Korean war remains obscure at this writing, immediate outbreak of World War III is most unlikely. Even if the major antagonists find it impossible to reach a mutually satisfactory compromise, they are unprepared for global combat. The motives that prompted Stalinist imperialism to launch the attack against South Korea on June 25, as well as the motives that led American imperialism promptly to intervene, are well known and require no further analysis here. Nor need we be particularly concerned with the resolution of the many complex political, social and economic problems arising from the liquidation of the Korean war, as these have no real strategic significance in the titanic struggle now being waged between bureaucratic collectivism (Stalinist imperialism) and capitalism (American imperialism) for control of the entire world. It is worth noting, in passing, that the political vacuum which existed in Korea and which was in a sense responsible for the war will remain. For the war has graphically revealed that an independent political force in Korea can never be powerful enough to achieve sovereignty. A Third Camp is not and cannot exist on any consequential scale in that unfortunate Land of the Morning Calm. Like other border areas incapable of independent existence, Korea is faced with the unhappy choice of a regime propped up by American bayonets or one controlled by the Stalinist secret police. What is important, however, for the world as a whole and for the orientation of the independent socialist movement in particular, is the perspectives that flow for the rival imperialisms once hostilities cease in Korea: Is the world to become two armed camps, waiting fearfully for the inexorable outbreak of World War III, or is some type of peace possible? Can the strategic aims of Stalinist and American imperialisms be modified in any significant degree? In a word, will the environment in which the class struggle operates differ in any noteworthy features from that which existed prior to the Korean war? And, if so, what will the consequences be and how can any such new trends be expected to manifest themselves? These are obviously crucial questions for the independent socialist movement and we shall seek to answer them in this and later articles. The spectacle of grown men mouthing meaningless words about peace is one with which we have become all too familiar in recent years. It has become even less edifying, if that is possible, as a result of the “peace” programs set forth by Acheson and Vishinsky amid the nauseating maneuvers of the rival imperialist blocs within the United Nations. Acheson has made it plain that the only program Washington has is to arm to the hilt. Then, when parity of armed forces is achieved, “we can negotiate with the Russians.” And this is called a policy, expressed by a “responsible statesman” occupying the lofty position of Secretary of State! To such a policy even a Vishinsky can reply with telling effect (The New York Times, October 14): “Authoritative American spokesmen say that it is only force that can impress the Soviet Union, and that when the United States is so strong as to make the Soviet Union shake in its shoes then, and only then, will it be possible to reach some understanding. What a profound and crude mistake! ... This is the policy of the diktat, the policy of pressure and imposition, the policy of demands and half-demands, repeatedly presented, pressed, bolstered and backed up by force, a proliferation of military measures, and circles of naval, land and air bases ...” In the course of the same speech, Stalin’s Foreign Minister indicated the equally bankrupt “peace” policy of Stalinist imperialism. After complaining that “The policy (of American imperialism) has been changed ... from the wartime period of cooperation ... to the post-war ... tough policy,” Vishinsky asks, “Why do you not get back to that situation (of wartime cooperation)? If you do, things might change.

If you do, things might change. I am profoundly convinced that things would change. To this thinly disguised offer of a deal; American imperialism has repeatedly given its answer: “The Soviet Government cannot be trusted to keep its word.” Mutual recriminations about who changed which policy first only serve to conceal the basic dilemma, which explains why neither Stalinist nor American imperialism can “trust the other.” The wartime alliance between Anglo-American and Stalinist imperialisms was brought about solely due to the superior threat posed by an aggressive German imperialism under Hitler. In the absence of any such threat, it is impossible for the imperialist expressions of capitalism and bureaucratic collectivism to arrive at any lasting agreement that would permit a peaceful solution of the world’s problems. The conflict between bureaucratic collectivism and capitalism is irrepressible. No matter what pious statements about peaceful coexistence of the two systems are issued by Moscow and Washington, they cannot disguise the fundamental antagonisms that make inevitable a clash for world supremacy. We are long accustomed to the periodic quotations from Stalin, as the occasion demands, about the “peaceful intentions of the USSR,” and (buttressed by falsified quotations from Lenin) the “possibility of peace between socialism and capitalism.” Now we are treated to a similar disingenuous spectacle by the State Department, over which the same Acheson presides. A popular pamphlet entitled Our Foreign Policy has recently been issued. According to The New York Times of September 30, the volume constitutes a bitter indictment of Soviet policy, but it also sets out to disprove the “view that the East-West split is one between communism and capitalism.” In other words, The State Department also set out to correct what it regarded as an incorrect impression of the present tension of the world. It is not a question of differing economic systems, said the booklet, but of the threat of a new imperialist power. “The deepening division between the Soviet-dominated bloc and the free world is not, as some people wrongly think, a conflict between capitalism and communism”, it said. “Among the nations of the free world, in fact, you will find some that are not capitalist at all, but have freely chosen a socialist system. “The conflict is really between a power-hungry government that is bent on spreading its power by force, terror and every other means and the community of free nations which refuses to be conquered or dominated, or to stand by and see its members swallowed up.” (Italics mine – T.N.V.) Thus, the State Department, like Vishinsky, would have us believe that all that is involved is a question of methods. That is to say, if Stalinism would relinquish its tactics of force, subversion and violence then we could have a peaceful world. It is axiomatic that methods flow from the socio-economic structure of a given state, but even if Stalinism employed “democratic” methods acceptable to Washington, American imperialism would still refuse “to stand by and see its members swallowed up.” Moreover, by this time it should be ABC, even to the State Department, that what really makes “the threat of a new imperialist power” is the existence of a new ruling class exploiting society in a new manner; namely, the social system known as bureaucratic collectivism. To be sure, this system is the antithesis of socialism and was actually brought to power by a counter-revolution that destroyed the workers state established by the Bolshevik Revolution. Nevertheless, it is the irreconcilable antagonisms between two economic systems that have given rise to the “East-West conflict” and which threaten to lead us to World War III within the next decade. Both Moscow and Washington, at bottom, know this, although from time to time each has politically expedient reasons for issuing propaganda, designed to convey a different impression. And each has its own reasons for preparing in its own way for the inevitable showdown. Stalinist imperialism, to which bureaucratic collectivism has given rise, is a system of slavery and peonage based on nationalized property. It is essentially an “import” imperialism whose aggressive policy is based on the economic necessity of acquiring constantly new sources of labor power; both skilled and slave, and of adding to its stock of producer and consumers goods, and which can feel safe politically only when it has integrated the major centers of world population and production into the system of bureaucratic collectivism. The Stalinist empire, as the same booklet of the State Department points out, has already enhanced its domain since the end of World War II by some 7,500,000 square miles of territory and by some 500,000,000 more people. American imperialism, on the other hand is by far the most powerful imperialism to which finance capitalism has given birth. It is an “export” imperialism, inexorably driven by the most rapid accumulation of capital in the history of capitalism to export capital in all its forms in ever-increasing quantities. It is easy-going and bloated but it cannot be indifferent to the huge bites that Stalinism has taken out of the world market. It must first contain Stalinist imperialism and then destroy it. In retrospect it is clear to American imperialism that it made many mistakes during the war, although the menace of German and Japanese imperialisms was immediate and real, while the danger of Stalinist imperialism was remote and at best imperfectly understood. To some extent these “mistakes” were unavoidable, for history rarely permits capitalism to function in terms of the long-run interests of the international bourgeoisie. What disturbs Washington, however, is the postwar mistake of permitting Stalin such an overwhelming head-start in the armaments race, for the curve of munitions production requires years before it generates real momentum.

What disturbs Washington, however, is the postwar mistake of permitting Stalin such an overwhelming head-start in the armaments race, for the curve of munitions production requires years before it generates real momentum. Indeed, it was not until 1944, despite the destruction wrought by Allied bombing, that American war production exceeded that of Nazi Germany. This lesson is well known in Washington and amounts for the unanimity that greeted the launching of the “national defense” program. In this connection, the series of articles in The New York Times by its Moscow correspondent, Harrison E. Salisbury, is most interesting. Having just returned from a vacation in the United States, Salisbury has found Stalinland to be one of peace and growing prosperity. “The atmosphere of Moscow, and of the part of Russia that I crossed in traveling here from Poland,” he says, “is not one of war nor of preparation for war.” He concludes his dispatch of October 13 by stating: “What is interesting about the Soviet situation is that as of today, so far as research can determine, there has been no substantial changeover of the economy from its predominantly peacetime aspect to one of preparation for, or anticipation of, war.” We do not wish to impugn Mr. Salisbury’s research abilities, or even the facilities made available to him in conducting his research, but the timing of the articles invites the suspicion that they were inspired by more than reportorial zeal and the conclusion is demonstrably false. The facts have nothing to do with atmosphere, which may well be as reported, but if Moscow today has a “predominantly peacetime aspect” it can only be because the normal face of Stalinism is one of a Permanent War Economy. The maintenance of 300 divisions, even it all are not at full wartime strength, the arming of the satellites, the military-technological development of strategic roads, canals, railroads, airports and other means of communication and transportation within the satellite countries, the expansion of the Soviet Navy, especially the submarine fleet, the feverish development of uranium mines, etc., etc., are an indisputable evidence of a war economy. Since statistics are a “class science” in Stalinland, we cannot say what the precise percentage of the national product spent for war purposes is, but at a guess we would place it in the neighborhood of 25 per cent. Since during the last war only about 50 per cent of the national product was devoted by the Soviet Government to direct war outlays, such a reduction coupled with the fruits of imperialist acquisition and increasing production could well result in some improvement in civilian standards of living. The important point is that for Stalinism the shift from “peace” to “war” is only quantitative, not qualitative, and can be accomplished without upsetting normal routines, either politically or economically. Moreover, while the ultimate aim of Stalinist imperialist strategy is conquest of the entire world, the immediate aims are clearly more limited. Time, the Kremlin feels, is on its side. It must complete the process of integrating the economics of existing satellites into its own. It needs another five-year plan or perhaps two, to increase its production and military potential to the desired level of overwhelming superiority, not to mention atomic equality. It must overthrow Tito and eliminate Titoism, in which objective it may have been mightily aided by the recent drought in Yugoslavia that, at last report, has destroyed some 4,000,000 tons of foodstuffs. Then must come the closing of the pincers on India and, choicest morsel of all, acquisition of all of Germany. The air of confidence and tranquillity with which Stalinist spokesmen face the future is therefore much more than a mere propaganda “trick,” a so-called “peace offensive” to lull the decadent democracies into lowering their armed guard so that they will be an easy prey for a sudden onslaught. Stalin would welcome a deal with American imperialism, provided that it did not materially weaken his chances of obtaining control of the entire vast Eurasian heartland, for this is the realistic strategic objective of Stalinist imperialism in the next decade. The Stalinist ruling class has everything to gain by postponing the final battle with American imperialism, or so it reasons. Two aspects of current American imperialist policy are most noteworthy. Internally, there is minimal unanimity within the American bourgeoisie regarding the fundamentals of imperialist strategy. The Truman policy of containment of Stalinist imperialism, which is the essential meaning of all major steps in foreign policy in recent years, may be criticized as to the manner in which it has been carried out but it is rare indeed that anyone seeks to change the objective or, the major strategy adopted to achieve this basic purpose. This is reflected in domestic politics by the extreme weakness of the isolationist fringe, an obvious but nonetheless significant difference from the post-World War I situation. It is apparent that all major tendencies within American imperialism are clearly aware that it would be fatal to permit Stalinist imperialism to control all of Europe and Asia, from the Atlantic to the Pacific and Indian oceans, for if Stalinist imperialism controlled three-fourths of the world’s population an insoluble political problem is presented even if in the long run a military victory under such adverse conditions may still be possible. Externally, despite the establishment of the so-called Stettin-Trieste line and the attempts to establish a comparable demarcation line in Asia, American imperialism has clearly been on the defensive. It is Stalinist imperialism that selects the area and methods of struggle and American imperialism that replies with a thoroughly improvised policy. Because these tactical methods are either generally unsuccessful or incapable of achieving any lasting victory, which is more or less inevitable in view of American imperialism’s inability to solve any conflict on other than military terms, there is dissatisfaction with and criticism of specific tactics. This tactical opposition has combined with mounting economic pressures to establish the policy of containing Stalinist imperialism through the mobilization of superior armed force. From parity, which will be impossible to measure, to superiority of armed forces, which may not be easy to achieve, to World War III, which may be difficult to win, is the road on which American imperialism has definitely embarked.

From parity, which will be impossible to measure, to superiority of armed forces, which may not be easy to achieve, to World War III, which may be difficult to win, is the road on which American imperialism has definitely embarked. Korea exploded the fallacy that American imperialism could contain Stalinist imperialism through speeches and a business-as-usual (i.e., a defensive) policy. For a brief flurry it almost gave rise to its diametric opposite, the policy of the direct offensive which meant seeking immediately a purely military victory over Stalinist imperialism. This, in essence, is the position of the advocates of a “preventive” war and all variations thereof. We do not for one moment exclude the possibility that American imperialism can defeat Stalinist imperialism in an all-out war, featured especially by use of the atomic bomb, but such a military victory would be politically disastrous. It is most unlikely, moreover, that the struggle would be short or easy. On the contrary, all available evidence points to a protracted war between two fairly evenly matched antagonists. The consequent economic destruction and totalitarianization of American political life, without even considering the impact on the rest of the world, would make any military victor; absolutely worthless. Such a policy then can be only a last resort, to be embraced only if there is no other hope for survival of the American capitalist class. Faced with the failure of the previous “defensive” policy and the impossibility of adopting an overwhelmingly “aggressive” policy, the American bourgeoisie has finally reached a policy that in political terms can best be described as “Neither Peace nor War”. And is literally true that they do not want peace and cannot afford war with Stalinism! To be sure, American imperialism cannot mobilize the support of the international proletariat, as Trotsky hoped to do when he advanced the identical slogan on the occasion of the Brest Litovsk discussions, but it can hope to mobilise what is left of the international bourgeoisie. The policy of “Neither Peace Nor War” will gain time, unless of course Stalinist imperialism reacts by casting the die for immediate war. This is most unlikely for reasons cited earlier. Naturally, if war does take place within the next few years, then the present breathing spell will have been utilized to overcome the Stalinist headstart in armaments production, or at least to reduce the present disparity, thereby enhancing the prospects of American imperialism for military victory. Above all, allies will be sought and armed in all areas of the world not under the control of Stalinist imperialism. This is, of course, the real meaning of the Atlantic Pact and related policies. The process of reducing British, French and other Western European imperialisms to the position of satellites dependent upon military and economic aid from the United States is a complicated one and takes time. It takes even more time to revive and harness the military power of defeated German and Japanese imperialisms. American imperialism would also like to have the time to conquer the markets of the disintegrating British Empire and to solve a series of other economic problems arising out of the pressure of the most rapid accumulation of capital in the history of the world. This ambivalent policy is not without its dangers, but there is no alternative for American imperialism. It even contains the hope that the death of Stalin may precipitate a struggle for succession that will greatly weaken or even destroy Stalinist imperialism. Mr Hoffman of ECA fame is fond of speculating on such a turn of events, and it is said that this is one of the reasons he opposed the militarization of the Marshall Plan which presumably led to his resignation. No better illustration of the significance of the new policy can be found than in what has happened to the Marshall Plan. Although in the interests of American imperialism, and part of the policy of Stalinist containment, it did nevertheless eschew military policies and it had make some progress toward improving standards of living in Western Europe and achieving a more rational and integrated economy. Now all this has been abandoned under the impact of the mobilization program. As The New York Times correspondent, Michael L. Hoffman, expresses it in his dispatch published on October 13 “Time and again in the past few weeks this correspondent has heard. European economic officials of various nationalities say with an actual or figurative shrug of the shoulders that as the United States seemed to have lost interest in everything except rearmament each country had better start looking out after itself in economic matters.” (My italics – T.N.V.) In fact, the article was headlined “Europe’s economy edges to autarchy.” The political reception that the new American policy has received in Europe and Asia, especially Asia, is anything but favorable. But it is its economic causes and effects that are the key to the shape of the world after the end of the Korean war. The immediate origin of the economic pressures that have pushed American imperialism into its new course, which is without historical precedent for a democratic capitalist nation, lies in the phenomenal expansion of the productive forces during World War II and the virtual maintenance of this level of production during the last five years.

The immediate origin of the economic pressures that have pushed American imperialism into its new course, which is without historical precedent for a democratic capitalist nation, lies in the phenomenal expansion of the productive forces during World War II and the virtual maintenance of this level of production during the last five years. This development has not only been contrary to the expectations of the bourgeoisie but also, let us admit, unexpected by most Marxists. Here our analysis will be helped by making reference to some statistical measures, even if they are considered as but crude approximations. We start with the fact that production increased about 12 per cent a year during World War II, from 1939 to 1945. In other words, total output was some 72 per cent higher when the war ended than when it began. This can be seen by examining the figures for national income and national product of the Department of Commerce as published in the Survey of Current Business (the latest revisions are contained in the issue of July 1950). WARTIME GROWTH OF OUTPUT (Millions of Dollars) 1939 1945 % Increase Current Dollars % Increase Constant Dollars* National Income $72,532 $182,621 152% 84% Net National Product $83,238 $202,800 144% 78% Gross National Product $91,339 $215,210 136% 72% * Calculated by deflating the 1945 current dollar figures by the rise in the BLS wholesale price index, which rose from 77.1 in 1939 to 106.3 In 1945 – a rise of 37.2 per cent yielding a deflator of 27.1 per cent. National income and product figures are, of course, estimates, but they are the only dollar figures that attempt to portray the productive performance of the economy. Without entering into current controversies among the national income specialists, and, granting that important conceptual and statistical problems are involved, we are concerned only with basic trends which are not altered even if the margin of error in the figures is sizable. Fundamentally, gross national product is larger than net national product by the inclusion of capital depreciation and depletion. That is, the net value of current production ought not to include the consumption of capital as this is already reflected in the final prices of commodities on the market. Net national product is larger than national income chiefly due to the inclusion of indirect business taxes and liabilities, i.e., sales and excise taxes, etc., thus affecting the evaluation of government services. We have based our conclusion about the Wartime growth of output on gross national product because, while the BLS wholesale price index is the best single indicator of price changes throughout the economy, it undoubtedly understates to some extent the degree of wartime inflation. A sounder procedure would have been to deflate separately each component of gross national product, but the work involved would not be justified by appreciably greater accuracy in the results. And for our purposes it is of relatively minor importance whether real output increased by 60 per cent, 70 per cent or 80 per cent during the war. As a matter of fact, the federal reserve index of industrial production, which is based on physical volume, tends to confirm our analysis. This index, by for the most comprehensive of all industrial production indexes, rose from 109 in 1939 to 203 in 1945, a rise of 86 per cent. The Federal Reserve index, however, definitely overstates as a measure of total output in wartime because of weight assigned to war industries in its composition. We are therefore content to rest with the figure of 72 per cent as the wartime increase in total output. How was this huge increase in production achieved? Initial impetus, of course, was provided by the availability of significant quantities of idle resources, including over nine million unemployed. There then occurred a surprising increase in the total employed labor force which, including both the civilian and armed force sectors, rose from over 45 million in 1939 to about 64 million in 1915, a rise of roughly 40 per cent. Even without the armed forces of almost 12 million, the employed civilian labor force still rose by about seven million workers, who worked for longer hours and whose productivity was increased by a huge expansion in productive capacity largely as a result of the enormous government expenditures for plant and equipment. In other words, the wartime expansion in real output was made possible essentially by an increase in capital accumulation and in the supply of labor power, in roughly equal proportions. Had the wartime increase in the total labor force largely evaporated with the cessation of hostilities and had the wartime increase in capital been totally unsuited for peacetime use or, to the extent that it was unadaptable, had it not been substantially replenished by new, peacetime accumulations of capital, the level of activity of the economy would have reverted to prewar output, with consequent depressing effects. This did not occur, contrary to many expectations, because government expenditures were maintained at high levels, partly for war purposes, and American imperialism decided to support the recovery of the economics of Western Europe as part of the policy of containment of Stalinist imperialism and as a means of increasing the market for products of American capitalism. The entire process, of course, was nourished by the backlog accumulated backlog of consumer demands in the domestic market which, in turn, were supported by the tremendous level of private savings. The same procedure that was used to calculate the wartime increase in output shows that postwar output is currently almost the levels achieved at the end of the war. It is true that our calculations yield an 18 per cent decline in real output in last five years, but the decline in the last four years is only 5 per cent. In other words, more than two-thirds the relatively small decline that has occurred took place in 1946, in the first postwar year before the menace of Stalinist imperialism became apparent to the leaders of the American bourgeoisie. Perhaps a planned reconversion would have averted the decline of 1946 best it must be remembered that the dominant elements within American capitalism at that time were bating all their plans and policies on a return to the status quo ante bellum.

It must be emphasized that the achievement of these extremely high levels of production occurred prior to the outbreak of the Korean war. For example, the Federal Reserve index was at 201 in July 1950 compared with 203 in 1945. Since then it has risen sharply, but at that level it is 14 per cent above 1949 and 5 per cent above 1948, the previous postwar peak. The labor force data show that the war-time peaks have been equaled. For June 1950 the employed civilian labor force was estimated (September 1950 issue of Monthly Labor Review) at 61,482,000. When the derived armed forces figure of 1,311,000 is added to this figure, the total employed labor force becomes 62,793,000 or close to the 64 minion figure reached in war time. There is, of course, the vast difference that the wartime figure included 12 million in the armed forces whereas the current pre-Korean armed forces figure is only slightly over 1,300,000. In other words, more than 9 million have been added to the employed civilian labor force since the end of World War II. These figures help to explain why Washington is so concerned about manpower shortages as the mobilization program unfolds, but they also reveal, in spite of the shorter work week, a goodly portion of the reason why postwar output has been maintained at almost wartime levels. The other part of the postwar story of high level production and employment is to be found in the extremely rapid rate of private capital accumulation, the figures for which are even more pregnant with meaning for the future than the manpower data. The tabulation, based on the Department of Commerce data, graphically reveals the picture: POST WAR CAPITAL ACCUMULATION (billions of Dollars) Gross Private Domestic Investment Net Foreign Investment Total Private Gross Capital Formation 1946 28.7 4.6 33.3 1947 30.2 8.9 39.1 1948 42.1 1.9 45.0 1949 33.0 0.4 33.4 1950 est.* 46.0 –2.0 44.0 POSTWAR TOTAL 181.0 13.8 194.8 *Based on estimates for first and second quarters of 1950 as contained in August 1950 Survey of Current Business. Thus, in the five postwar years American capitalists have accumulated on gross basis about 195 billion dollars, or an average of 39 billion dollars annually. This represents about 16 per cent of the postwar annual gross national product, a truly staggering percentage, especially when we remember that this growth in capital accumulation occurred with the economy already operating at peak levels due to the war. If we wish to measure the net addition to private capital formation (i.e., the net additions to plant, equipment, construction, and business inventories, or constant capital as Marx would have put it), we have to subtract the postwar consumption of capital from gross private domestic investment. This is a field in which the experts always disagree as it involves depreciation, treatment of business reserves and accounting practices. It is clear that the maximum it can be, using the Department of Commerce figures, is the difference between what is termed “net national product” and “gross national product,” or about $83 billion. This would mean an average postwar annual capital consumption of over $16 billion, which appears to be excessive, and is accounted for not only by the rapid amortisation that was permitted of wartime plants but by the inclusion of “statistical discrepancies” and other uncertain quantities in the figures. It is noteworthy, however, that even on a net basis without any adjustment the annual rate of capital investment in the postwar period is 10 per cent, a rate that has not taken place in peacetime since the 1920’s. With proper adjustments, the percentage of net capital formation to net national product would appear to be about 12 per cent annually, which even exceeds the period 1919-1923, the five years following World War I. All current reports testify to this accumulation of capital, the material base for American imperialism. For example, a report of the Securities and Exchange Commission for the second quarter of 1956, which is summarized in The New York Times of October 12, states “that the net working capital of United States corporations reached $73,800,000,000 at the end of June.” No wonder, then, that a National Association of Manufacturers analysis of the postwar financing of business, the findings of which are summarized in The New York Times of October 16, is able to state: “Retained earnings were an important source of new capital,” although this admission is then qualified, “but this resulted from a relatively low level of dividends rather than from high profits.” We would not expect the NAM ever to admit that business is making “high profits,” but without passing judgment on current arguments between management and stockholders as to the proper distribution of profits, the fact of the matter is that American business has never accumulated such profits as it has in the postwar period. It is precisely the record accumulation of capital that makes so interesting the figures for the “net foreign investment” component of national product. Net foreign investment represents the net changes in claims against foreign countries and is affected principally by the net private balance of foreign trade and the net flow of long-term capital abroad. Thus, in the words of the August 1950 Survey of Current Business, “The negative balance of net foreign investment – arising from the substantial excess of Government grants over the current export surplus – remained for the second quarter of the year at approximately $2 billion, at an annual rate.” While perhaps too much significance should not be attributed to the absolute figures, the trend – rapidly accelerating after the end of the war through 1947 and rapidly reversing itself from 1943 to the present – portrays the entire tragedy of modern capitalism in the constriction of the market and a paucity of opportunities for profitable foreign investment of surplus capital.

The most recent figures on the net outflow of private long-term capital show the pathetically low levels to which American imperialism has sunk (from the September 1950 issue of the Survey of Current Business): NET OUTFLOW OF PRIVATE LONG-TERM CAPITAL (Millions of Dollars) III Quarter 1949 192 IV Quarter 1949 147 I Quarter 1950 227 II Quarter 1950 76 TOTAL 642 In other words, a mere 14 million dollars represents the total net export of capital by American imperialism during the past year. For the same period, the net outflow of Government long-term capital amounted to $162 million, or 25 per cent of the private total. Even on a gross basis, discounting the total inflow of capital into America from abroad, the private total for the past year is only $1,434,000,000. With capital accumulation proceeding at the all-time record rates described above, it is clear that the point where the American economy would be choked by surplus capital was rapidly being approached. The Point Four program, in particular, has been designed to establish a climate favorable to the investment of American capital abroad, but Truman has turned out to be just as fortunate as Roosevelt in the matter of having an aggressive foreign imperialism turn up at just the right time to make all sections of the American bourgeoisie unite in supporting an expanding program. War outlays will more than substitute for the inadequacies of the Point Four program. They will relieve a number of economic and political pressures, although in turn creating others. Just how high they will go remains to be seen, but Secretary of the Navy Matthews is reported in The New York Times of October 13 as saying, “The cost of operating the national military establishment alone next year might exceed this year’s entire national budget: That would be more $42,000,000,000.” There will, of course, be differences of opinion within the ruling class as to the degree of preparation that is required. And it makes quite a difference to many industries and many sections of the capitalist class whether, say, 10 per cent or 25 per cent of the national product is devoted to direct war outlays. An interesting statement of the perspective involved was made recently by Francis Adams Truslow, president of the New York Curb Exchange, as reported in The New York Times of September 23: “This war, or time of preparation, is not a specific all-out effort, but is perhaps almost a new way of living which we must endure indefinitely.” (My italics – T.N.V.) It should not escape our attention that this “new way of living” will operate on a world scale and that it is only another name for what we have called the Permanent War Economy. Its nature and impact are of the greatest importance, but will require a separate article or articles to analyze in any meaningful form. T.N. Vance Top of page Vance Archive | Trotskyist Writers Index | ETOL Main Page Last updated: 11.8.2008

Vance Archive | Trotskyist Writers Index | ETOL Main Page Frank Demby Stalin Orders Labor Peonage The Second of a Series of Articles on Russia (January 1941) From Labor Action, Vol. 5 No. 4, 27 January 1941, p. 4. Transcribed & marked up by Einde O’Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL). On May 28, June 26 and July 10, 1940, Stalin’s Council of Peoples’ Commissars of the USSR and the Central Committee of the Communist Party issued three decrees which subject the workers of Russia to a vicious slavery. These decrees represent the first fruits for the Russian workers of Stalin’s debacle in Finland, and the alliance with Hitler fascism. The First Decree The first of these decrees, that of foremen in most of the heavy indirect equivalent in every sense of a superintendent in a capitalist factory. He is to be considered the leader in that portion of the shop over which he has jurisdiction. He has full power in regard to the work assigned to him and bears complete responsibility for the carrying out of this work. The workers will now receive their orders through the foreman exclusively. The foreman now has the power to hire and fire all workmen, with the approval of the head of the department in question. The foreman is given the power to punish workers guilty of interfering with labor discipline. He pays out the wages of the workers. The foreman controls production and changes in production. He is expected to see to it that his workers are properly placed, given the proper tools, and properly instructed so as to produce the maximum amount possible. Since the foreman is now to occupy such an important position in Russia, he is to be chosen from among engineers, technicians, or highly qualified workmen. As a reward for administering Stalin’s whip over the workers, the wages of foremen were raised, starting June 1, so as to be higher than the average wage of qualified workmen. This means, at the very least, a doubling of wages for foremen. Already functioning foremen, without the necessary technical education, as well as newly appointed foremen, must pass a test given by the Committee of Attestations. In the usual propaganda blast which accompanied this decree, it is indicated that those previously in positions of management were distinguished by a lack of culture and general ignorance. “Proletarian origin” will no longer be a major qualification, or indeed a recommendation, for holding a managerial position, in the Union of Soviet Socialist Republics. Now the heads of departments and factory directors, as well as the practical workers without formal education, will respond to this decree remains to be seen, but there are already signs of discord and protest. The Second Decree The second decree, that of June 26, is the most drastic of all. To make it more palatable, it was issued at the initiative of the Central Council of Trade Unions of the USSR. A very important part of the decree is that which institutes a general wage cut amongst all workers of more than 15 percent. This is done not by directly cutting the amount of rubles which one Russian worker gets, but by lengthening the working day. Work is now organized on the basis of a seven day week, instead of a six day week. Hours of work per working day are lengthened from seven to eight hours, in all cases where the working day was formerly seven hours. This covers the overwhelming majority of workers. Those previously working six hours must now work seven hours, while employees of institutions and persons reaching the age of 16 who had previously worked six hours must now work eight hours. In all cases, of course, while the hours of work are increased, the wage remains the same. More important, however, than the wage cut in the decree of June 26 is the remainder of the decree which establishes complete industrial peonage. Workers are now absolutely forbidden to leave their jobs without authorization, or to move from one job to another. Permission for leaving or changing jobs can be granted only by the special authorization of a factory director. If a worker violates this provision, he can be sentenced by the People’s Court to a prison term of from two to four months. If the violation is called an illegal absence, the previous penalty for illegal absence – compulsory dismissal from the job – is supplanted by the new penalty: compulsory labor at the place of employment for a term of six months at a 25 percent wage reduction. And, typical of all Soviet decrees, factory directors who do not properly enforce these provisions will themselves be hold responsible. The lengthening of the work day is justified by references to the dangerous international situation and the threat of war. But it is nowhere indicated that this lengthening of the work day is to be temporary. The binding of workers to the factory, coming on top of the previous introduction of the internal passport system, is aimed at reducing the labor turnover in Soviet industry. The average Russian worker changes his job at least once a year. This is merely a reflection of the terrible living conditions obtaining in most Russian towns and factories. In addition, many of those workers guilty of “illegal absence” were Communist Party members absent on meetings of one kind or another. Consequently, the plenary session of the Central Committee of the Communist Party held in July, 1940, in order to enforce the decree of June 28 amongst Communist Party workers, decreed that there were to be no meetings or conferences of any kind during the working hours of the factory! Nothing, absolutely nothing, is to, interfere with the worker’s performance on his job. The Third Decree The third decree, that of July 10, has to do with output of poor quality and bad performance on the job.

The Third Decree The third decree, that of July 10, has to do with output of poor quality and bad performance on the job. Such cases are to be considered wreckage, and therefore a crime against the State. Factory directors and engineers will be held responsible and are subject to prison sentences of from five to eight years in case established standards are not lived up to in, any respect whatsoever. Closely related to these decrees are two others, one of which establishes the penalty for “petty theft” (regardless of the amount) or “acts of hooliganism” at one year in jail; the other specifically applies the industrial peonage decrees to the factory directors, and other managerial officials. No one employed in a factory in any capacity is now permitted to leave that factory, without the consent of Stalin, or one of his hirelings. Life in Stalin’s “paradise” will be something like the following for the average person: He attends school until the age of 14 (our equivalent of free secondary education, and free higher education has been abolished by a more recent decree); from the age of 14 to 18 he will be drafted for compulsory vocational training in mechanical lines which will serve the war machine; at the age of 18 he enters upon five years compulsory military training; at the age of 23, unless he enters permanent service in the armed forces, he will be assigned to work in any occupation in any location that pleases the dictate of the Kremlin. All this, of course, is in direct violation of Stalin’s own constitution of 1936. When assigned to some factory or establishment, regardless of his own inclination or family ties, the Soviet slave is now bound to the establishment for the rest of his working days. If, of course, the masters in the Kremlin wish to change his place of servitude, they may do so without consulting the worker himself. The result is, therefore, that the Russian worker today does not even have the same rights that the Russian serf had. The serf, at least, while treated as a thing, whose function was simply to produce enough for his lord and master to live on, was bound to the soil and could not be moved about at the whim of his master. The immediate reason for these decrees of industrial peonage is to be found in the visible breakdown of the Russian system of economic planning. The only way that Stalin knows to increase production is to command slave labor to produce or else. Whether these decrees will increase production or not, remains to be seen. If they do not, it will only hasten the day when Hitler decides to take over the direction of Soviet economy himself. If they do bring results, which is most unlikely, they can only serve to increase the thickness of the chains which bind the Russian worker in servitude today. In my next article in this series, I shall try to show the extent of the breakdown in Soviet economic planning and the reasons for this breakdown, for it must never be forgotten that the fundamental reasons for Stalin’s present policy are to be found in the internal weaknesses of Stalin’s regime. Top of page Vance Archive | Trotskyist Writers Index | ETOL Main Page Last updated: 21.11.2012

Vance Archive | Trotskyist Writers Index | ETOL Main Page Frank Demby Economic Notes (22 September 1941) From Labor Action, Vol. 5 No. 38, 22 September 1941, p. 2. Transcribed & marked up by Einde O’Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL). The Senate of the United States has outdone the House of Representatives in the race to see which branch of the “people’s” representatives can place the heavier tax burden on the masses. It’s all in a good cause – financing the “war for democracy”’ – so don’t mind if your tax bill is increased from three to seven times next year. The Senate voted to lower exemptions on the income tax from $800 to $750 for single persons and from $2,000 a year to $1,500 a year for married persons. This means that about 6,000,000 more persons – 23,000,000 in all – will have to file an income tax in 1942 if this bill becomes law. It also means higher rates for those earning from $2,000 to $10,000. Altogether, over $300,000,000 will be raised by this device. To show their seriousness in making the poor pay for the bosses’ war, the Senate lowered the excess profits tax almost $70,000,000. It then more than made up for this by raising the ante on excise and miscellaneous taxes some $85,000,000. This was done chiefly by raising the admission tax for amusements from 10 to 15 per cent, doubling the tax on local telephone bills (10 per cent instead of 5), imposing a 10 per cent tax on electric light bulbs, and a new tax on gas and oil appliances was included. The Senate has topped the House by more than $450,000,000 – of which almost 100 per cent falls on those who work for a living. Whether this will satisfy the National Association of Manufacturers, who agitated for a national sales tax and a payroll tax, remains to be seen. It will certainly not meet with favor among the workers. A loud roar of protest from the trade unions can still make Congress retreat a few steps! * Meanwhile profits continue to soar for the big companies under the impetus of huge war orders. The following figures show quite clearly to all except the Congress of the United States that taxes on profits and corporations can still be increased SUBSTANTIALLY without denting profits very much (figures are for the first half of each fiscal year): Profits Before Tax Provisions Net Profit Industry 1941 1940 Pct. Inc. 1941 1940 Pct. Inc. Tire and Rubber (5 companies) $50,675,509 $15,042,028 231 $20.501,250 $10,476;480 96 Railroad Equipment (10 companies) 20,323,000 9,203,000 120 11,594,000 7,490,011 55 Automotive Equipment (13 companies) 41,638,000 17,249,000 142 11,433,000 13,095,000 44 And this is only a small sample of what goes on every day. The patriotism of the rich thrives on this sort of diet. But what about the rest of us? * The first measures so far taken to prevent inflation remain a farce. Where they amount to anything, they are, as we predicted, further blows at the standard of living of the masses. The 7 p.m. curfew for the purpose of rationing gasoline has not only not reduced the consumption of gas, but available estimates show on increase in the sales of gas stations during the past few weeks. Meanwhile, Henderson’s order setting a price ceiling of 18.9 cents a gallon in the New York area has been honored more in the breach than by observance. This has brought a threat from “Little Flower” LaGuardia to have the mayors of various cities revoke the licenses of those dealers who are raising their prices. The only thing that will prevent a first-rate tempest from blowing up over this first example of what a war economy means is the sudden “discovery” that there are thousands of railroad oil tankers lying idle. The railroads and oil companies, were just having a private feud. The let-the-public-be-damned attitude of big business is due for a small curb in this instance. * On September 1, the new curbs on installment buying – aimed at restricting the purchases of durable consumers’ goods by the low income groups – went into effect. The Federal Reserve Board limited the maximum time for payments to 18 months and increased the down payments substantially in many cases. Sellers of these items report a brisk business; in some cases better than ever. Since the overwhelming majority of the $10,000,000,000 installment business is carried on among the workers and lower middle class, a serious restriction of this form of credit would mean a sharp decline in the standard of living of the masses. At present, the curbs on credit remain a joke – but watch out for the future! * On the organization front the President shuffled his “defense” agencies a bit. A super seven-man board, formally known as the Supply Priorities and Allocations Board, has been set up, charged with the responsibility of supervising the OPM and the other war bureaus. The SPAB is headed by Vice-President Wallace. The other members are: Secretary of War Stimson, Secretary of the Navy Knox, William S.

Knudsen and Sidney Hillman of the OPM, Price Administrator Henderson (who relinquishes his control of civilian supply) and Dollar-a-Year-Man Donald Nelson, who will be the executive director. Thus does Roosevelt hope to remove the conflicts that have been going on in Washington and satisfy the critics of the production program. That this will not do the trick was indicated by the blast from Barney Baruch, chairman of the War Industries Board in World War I, who continues to insist on the necessity for a one-man head. Meanwhile, another Wall Street speculator crashed the Washington dollar-a-year racket with the appointment of Floyd B. Odlum as director of the new Division of Contract Distribution. This replaces the Defense Contract Service and is supposed to see to it that small business gets sub-contracts on the huge war orders that the big corporations are getting and can’t fill. Fat chance! Small business is doomed and the war economy will hasten the process. After all, why should organizations controlled by big business order themselves to split their profits with a lot of little competitors? Monopoly capitalism doesn’t work that way. Not only can’t it create a decent peace economy; it can’t even establish an efficient war economy! * Two developments along Wall Street are worth noting. We are very happy to report that Wendell L. Willkie, the man who made the supreme sacrifice of resigning from the presidency of Commonwealth & Southern to crusade against the dictatorial aims of the New Deal third term, is not doing so badly for himself. After becoming senior partner in the lucrative law firm of Willkie, Owen, Otis & Bailey, this junior partner of the unincorporated firm of Roosevelt & Willkie was elected a director of the Federal Insurance Co. on June 4. Now he is being proposed for a second directorship – this time in the very important firm controlled by the Lehman brothers, known as the Lehman Corp. We are confident that the October 15 meeting of the stockholders of the Lehman Corp. will elect Mr. Willkie a director. Just another example of how it pays to be a public-spirited citizen, provided, of course, you know the right people! Who says this isn’t the land of opportunity? The other interesting development in Wall Street is further evidence of the tremendous opportunities that await the eager and patient youngster of today. The American Telephone & Telegraph Co., a Morgan subsidiary, which has conducted all its financing for the past 30 years through the House of Morgan, has announced that its forthcoming issue of $94,500,000 worth of debentures is to be subject to competitive bidding. Here’s a chance for you to make a million dollars in commission. All you have to do is to submit the lowest bid for handling these bonds. The lowest bidder must get the issue. Then all you have to do is to sell them. The bonds are absolutely gilt-edged. There should be no trouble at all. So far, however, there are only two syndicates in the field; one, a group of 28 powerful investment bankers, headed by Morgan Stanley & Co., Inc. (Mr. Morgan’s son-in-law is head man in this outfit); the other, one of the largest syndicates every assembled, comprising about 175 investment houses, headed by Halsey, Stuart & Co., Inc., and the Mellon Securities Corp. We are about $94,499,999 short of the required amount, else we would submit a bid. Maybe our readers can help us out. Kidding aside, though, this is important because it shows that all attempts to maintain competition must remain solely between the big capitalists. And it can’t be otherwise, considering the kind of economic system we live under. One more proof of the necessity for socialism! Top of page Vance Archive | Trotskyist Writers Index | ETOL Main Page Last updated: 27.1.2013

Vance Archive | Trotskyist Writers Index | ETOL Main Page Frank Demby America’s War Economy (September 1941) From The New International, Vol. VII No. 8 (Whole No. 57), September 1941, pp. 200–4. Transcribed & marked up by Einde O’Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL). AFTER MORE THAN two years of the Second World War, and after more than one year of the “Defense” Program, the single outstanding fact which emerges in any study of the economic situation in the United States is that America has entered upon a period of war economy. Already, approximately 25 per cent of the national income is being spent for purposes of armament. This amount will steadily increase until, before long, the major proportion of American resources, both human and material, will be devoted to the production of means of destruction. The American public is still almost blissfully unaware of what this will mean in terms of the daily routine of normal life. Rising prices, increased taxes, shortages of consumers goods, fast-increasing government controls – all, however, point to the inescapable fact that the “honeymoon” period is over. From now on, as the war economy develops further, the mass of the people will become well aware of what a war economy means. The standard of living will go down. The routine of normal life will be seriously interrupted due to the increasing dislocations produced by the insatiable appetite of the war machine. The atmosphere of crisis will become chronic, for war is but an expression of far-reaching social crisis. The developing war economy brings in its train a series of important questions – political, social and economic in nature. I am particularly concerned, in this article, with some of the economic questions raised by the entrance of the United States into a period of war economy. Two basic questions immediately arise: Who pays for the war economy and how do they pay? Who profits from the war economy and how do they profit? These questions, in turn, give rise to a third basic summary question: What will be the effect of the war economy, in its short-term and long-run aspects, on the future development of American economy? Early this year, in one of his fireside chats, the President warned the people that they would have to expect sacrifices. While the full implications of these sacrifices remain to be unfolded, the broad outlines, as well as some of the details, are already quite clear. The 1940 and 1941 revenue bills, for example, unmistakably reveal the intention of the government to make the working masses bear the brunt of the burden of financing the imperialist war effort of the United States. The Tax Bill At this writing, the final form of the 1941 revenue bill has not yet been established. The bill is “in conference,” as a result of several very important changes made by the Senate in the House version. However, it appears that the more drastic Senate version will more nearly approximate the final form of the Bill than that of the House. This will mean a sharp increase in the income tax on the lower income brackets, for the Senate has lowered the exemption for married persons from $2,000 (until 1940 it was $2,500) to $1,500, and for single individuals from $800 (until 1940 it was $1,000) to $750. By this measure 5,000,000 persons who never previously filed a federal income tax will now have to do so. Due to exemptions, it is expected that only about half this number will actually have to pay an income tax in 1942. Altogether, more than 20,000,000 people will now pay an income tax. This does not appear to be very drastic when it is recalled that about 60,000,000 people in the United States receive some form of income. But it must be remembered that the income tax was originally hailed as a progressive form of taxation because it was presumably based on ability to pay. An income tax which broadens the base as the current bill proposes, begins to violate the “principle” of ability to pay. It definitely imposes severe hardships on those who can least afford to pay. Consider, for example, the case of an unmarried worker making $20 a week ($1,000 a year) – and there are many in this category. Before 1940 he did not pay any income tax. Under the 1940 act, he paid an income tax of $4.00. Under the Senate proposal for the 1941 act, this worker, who has great difficulty maintaining a bare subsistence level, will have to pay an income tax of $21 – more than one week’s pay and an increase of 425 per cent in his income tax. A married worker with no dependents earning $2,000 a year previously paid no income tax. Now he will have to pay an income tax of $42. Remember that this is only the income tax. The TNEC has estimated that approximately 25 per cent of the income of those in the lowest income brackets is already taxed indirectly through various forms of excise taxes. The indirect tax burden is also be to increased – by more than one billion dollars. This will add tremendously to the tax load borne by the working class and the middle classes. Virtually the same percentage of income received will be paid by the worker and the millionaire, when all forms of taxation are considered!

Virtually the same percentage of income received will be paid by the worker and the millionaire, when all forms of taxation are considered! Who Will Really Pay I do not have the space to analyze the various types of excise taxes proposed. Moreover, this field of taxation is much more subject to change than the income tax before the President affixes his signature. One example will suffice, however, to show the colossal injustice involved. Both the Senate and House have passed a provision calling for a $5 a year “Use” tax on owners of motor vehicles and boats. It is expected that more than $160,000,000 will be raised through this entirely new tax. This is one of the most vicious examples imaginable of a violation of the ability to pay principle in taxation. Firstly, in many cases, automobiles have assumed the proportions of a necessity to their owners. Why include boats (which category presumably covers yachts as well as motorboats) in the same provision with automobiles? Secondly, of the approximately 30,000,000 automobiles subject to this tax, there can be no doubt that the owners of the majority of these cars will find it difficult to pay this tax, whereas a $5.00 tax on the owner of a Packard or Cadillac will hardly put a dent in the owner’s pocketbook. The same is true for virtually every type of excise or miscellaneous tax proposed. The workers and the middle classes – those who work for a living – will finance the imperialist war. They are the ones who will make the real sacrifices under the war economy. In contrast, take the case of a man with an income of $1,000,000 a year, having two dependents. His tax is raised from $717,056.40 to $735,972.40 – an increase of almost $19,000, but it still leaves him more than a quarter of a million dollars on which to struggle along! The excise and miscellaneous taxes hardly figure in the tax burden of the wealthy at all. Nor does this take into account the well known fact that one of the biggest frauds in the present tax structure is the ability of the wealthy to dodge a considerable proportion of their tax burden through the many clever devices that their expensive lawyers have worked out. It was undoubtedly in response to pressure designed to eliminate one of the favorite tax-dodging methods of the rich – making property “gifts” to their spouses – that prompted the House Ways and Means Committee to propose the highly controversial joint returns. This would have compelled all married couples to file a single joint income tax return. The real burden of this device, too, would have fallen, as I pointed out in Labor Action, on the middle income groups and the upper strata of the working class. This is not the way to prevent tax-dodging by the wealthy. Higher estate and gift taxes would be a much more stringent proposal. Profits Insured by Congress If there still be any doubt that this tax bill is class legislation in favor of the bourgeoisie, a brief glance at the corporation income and excess profits taxes should dispel any lingering illusions. The present corporation income tax rate is 24 per cent of net profits. Slight increases in the surtax rate on corporations have been proposed – 5 per cent on the first $25,000 of net income and 6 per cent thereafter by the House, and 6 and 7 per cent respectively by the Senate. The Senate more than made up for its slight increase in the corporation surtax rate by eliminating the special 10 per cent tax on corporations not earning enough profits to come under the excess profits tax schedule passed by the House. If taxation is to be based on ability to pay, what is obviously required here is a corporation income tax with progressively higher rates, corresponding to the personal income tax. Why should a Corporation like General Motors, with a net income around $200,000,000 a year, pay the same rate of income tax as a small corporation with a net income of $200,000 or less? And if the argument is made that the large corporation does pay a higher rate of tax because of the excess profits tax provisions, the answer is that fundamentally this is not the case since the excess profits tax remains a pure swindle. The proposed increase of 10 per cent in the excess profits tax schedule (making the tax run from 35 per cent to 60 per cent) is no more than a drop in the bucket, as a glance at current corporate earnings will show. Due to the maintenance of alternate methods of computing the excess profits tax by either the average earnings method or the capital investment method, most of the large corporations have been able to keep their excess profits down to very modest sums. Consequently, they pay a very small excess profits tax. Moreover, the new provision allowing a credit of 125 per cent for all new capital investment will actually lower the excess profits tax in some cases. An excess profits tax of anything less than 100 per cent, and without all the “liberalizing” amendments that have been introduced, cannot be considered a genuine excess profits tax. The tax burdens outlined above represent only the beginning, severe though they are. As the war economy develops, taxes will continue to increase. Their pattern, however, is established, so long as the capitalist government remains in control of the situation. The motto in Washington is: Soak the poor; Go easy on the rich. What Big Business Demands The real program of the bourgeoisie is always that presented by the National Association of Manufacturers. In the field of taxation, the NAM has stated its reactionary program in unambiguous terms. Its representative, Livingston W. Houston, chairman of the finance committee of the NAM, testified last month before the Senate Finance Committee in favor of a general sales tax, as well as approving the broadening of the income tax base. The NAM, as well as other organizations representing industry and finance, have already indicated that their basic tax program for next year will not only include a general sales tax (the most reactionary type of tax possible) but also a payroll tax.

Volumes of propaganda will be forthcoming during the next year in an attempt to show that the only way to prevent inflation and to preserve the credit of the United States is to tax more heavily the 75 per cent of income earners who get less than $5,000 a year. The surest way to tax this overwhelming majority of the population, in a manner which will make it “almost unnoticeable” to them, is through the sales tax and the payroll tax. So the propaganda will run. It will not mention, however, the really vital point – by levying a sales tax and/or a payroll tax the big bourgeoisie will be utilizing the emergency represented by the developing war economy to accelerate the process of wiping out the middle classes and to saddle the working class with a yoke which will make it impossible for them to breathe. The answer to the question, Who pays for the war?, gives us already a pretty good picture of what a capitalist war economy looks like. It is hardly one which is designed to appeal to the broad, popular masses, whose support is so essential for the carrying out of the imperialist war program. But, as long as the masses are willing to delude themselves with the utterly false notion that Roosevelt can somehow or other stop fascism, the masses will make these sacrifices, even though with much grumbling. If the masses can stomach the tax program, it does not at all mean that the remainder of the war economy picture appeals to them. The dislocations caused by the war economy are already becoming quite irritating. At the moment, though, these irritations are mere pin-pricks. What is really getting the goat of the masses, particularly the factory workers, is the absolutely fabulous profits which the big corporations are making – profits which are rolling in despite every attempt to conceal them and at a time when the workers are beginning to feel the pinch of a rising cost of living brought about by steadily rising prices. These huge profits cause an instinctive reaction on the part of workers. They violate their innate sense of fair play. “Why should the big bosses make millions while we sweat and slave for long hours and through an intensive speed-up, while we march and drill until we are utterly worn out in the conscript army, and while our wives are having an increasingly more difficult time making ends meet on account of prices going up practically every day?” These are becoming the daily thoughts of the workers. They are behind almost every strike that takes place. The workers feel that if the actions of the bosses represent good patriotism, they might as well get their “cut” of this temporary prosperity. Who knows how long this war boom will last? These sentiments are not the product of our imagination or wishful thinking. They are repeatedly testified to by eminent representatives of the bourgeoisie. The admittedly low morale of the army and the general apathy of the civilian population to the war are eloquent, if silent, confirmation of the deep-seated existence of this sentiment. The New Prosperity A war economy without huge profits, however, is simply something that is absolutely inconceivable to the rulers of America. Take these huge profits away and 99.9 per cent of their enthusiasm for war disappears. Reports of corporate earnings that appear daily in the financial sections of the newspapers make it appear that the good old days of 1928 and 1929 are here again. Led by the aircraft industry and munitions manufacturers, and closely followed by chemicals, steel, auto, rubber, petroleum, mining and construction, the boom in profits extends all the way through the consumers’ goods lines, like food, textiles and department stores, to that most bankrupt of all capitalist industries, the railroads. Even the public utilities show substantial increases in profits. Industry as a whole is expected in 1941 at least to equal the fantastic profits of 1929. In any cases, they will undoubtedly be exceeded. To assume from this that the situation is fundamentally similar to the “Golden Age” of the late 1920s would be to make a fatal error. There are significant differences. This profit boom is occurring in a war economy. This means that the principal market for the products of industry is the government. Without “national defense” orders, which have already passed the huge total of $50,000,000,000, industry, particularly heavy industry, would collapse instantaneously. Along with this increasing dependence of industry on government goes a steady invasion of government by industry. The dollar-a-year men have overrun Washington like a swarm of locusts. Many of the leading and most capable representatives of big business have resigned from their official posts in their respective corporations to assume key posts in the OPM and other Washington bureaus. By sheer coincidence, since most of the dollar-a-year men come from the large and well established corporations, their corporations have received the lion’s share of government contracts. In other words, the market, which becomes increasingly the government, becomes increasingly monopolized by a handful of super-giants. Big Business Gains The tendency toward concentration of industry and profits which appears as a part of the normal development of capitalism in the epoch of imperialism – a process which clearly set in here in the United States during World War I – is thus reinforced and accentuated as the American war economy develops during World War II. Almost any industry becomes a good example of this tendency. Naturally, the war industries are the best examples. Let us take, for example, the chemical industry. A review of twenty-two leading corporations indicates a combined net profit of $41,091,152 after income and excess profits taxes in the second quarter of the current year, against $36,396,307 correspondingly in 1940; net profit for the first quarter was $39,458,325, against $40,262,327 in 1940. (New York Times, September 14) The second quarter of 1941 thus represents the highest profit ever made by the chemical industry in any year. For in the first six months of 1941, twenty-seven companies showed a combined profit of $88,180,705.

For in the first six months of 1941, twenty-seven companies showed a combined profit of $88,180,705. This compares with $78,997,654 in the first half of 1940 and 172,500,859 in the second half of 1940. Eleven large companies (this excludes the income that duPont receives from General Motors dividends) earned $43,755,445 in the first half of 1941, as against a net profit of $45,075,800 in the first half of 1940. However, when duPont’s dividends from General Motors are included, the figures become $61,255,445 and $62,575,800 respectively. Whether duPont’s General Motors dividends are included or not (and General Motors, of course, is one of the six corporations that has received more than 50 per cent of all “defense” orders), the fact is inescapable that a small portion of the number of firms in the field receives the bulk of the orders and the bulk of the profits. If figures were available for the really big chemical concerns, like duPont, Allied Chemical and Dow Chemical, the concentration of profits would be much more startling. As a matter of fact, the profits of the giant corporations are even greater than these figures indicate, for I have presented the official figures for net profits, without considering the earnings before provision is made for taxes. The following table (again of eleven leading chemical companies, excluding General Motors’ dividends to duPont) represents a typical picture: First half 1941 1940 Earnings before taxes $112,909,619 $64,673,449 Federal taxes* 69,154,174 19,597,649 * Income and excess profits taxes and contingency reserves against future tax increases. Earnings before taxes are thus 74 per cent higher in the first half of 1941 as compared with the first half of 1940. Many industries will show an even higher percentage increase in gross profits. The aircraft industry, for example, is well over 100 per cent. It is true that taxes have increased, but not nearly as much as appears from the figures presented. The joker, of course, is in the phrase, contingency reserves. Just what these are or how much they amount to is never revealed in statements of this kind. Corporation directors always explain to their stockholders that putting aside of such huge amounts for taxes on the ground that they don’t know just what kind of a tax bill Congress will pass and they have to be prepared, as good managers, for any emergency that may arise. Moreover, they usually add, we live in a period of uncertain times. Sound and conservative business practice dictates to us the necessity of storing up surpluses for the “rainy days” that may lie ahead. This may be sound business practice – if not on the grounds indicated by corporation directors – at least from the point of view of concealing fabulous profits. It might be added that profits statements never make any mention of huge salaries and bonuses paid to officers and directors. The tendency, however, is for these to increase and this becomes another effective method of concealing huge profits. Government and Business The profits picture is not complete without at least mentioning that the dependence of profits on government contracts brings with it a feature that can hardly be disagreeable to the corporations. Government contracts are always so worded, either through a cost-plus provision or some other device, that the huge profits of the big corporations are guaranteed by the government. There is no risk attached, except the risk that the war may end. The defenders of free private enterprise and “private initiative” may find the trend toward increasing government intervention in industry rather alarming – as indeed it is from some points of view – but they always conveniently forget to mention the one factor which endears state monopoly capitalism to the hearts of big business: profits are guaranteed and competition eliminated by the government. The elimination of competition is essential for a smoothly functioning war economy. In a period such as this, anti-trust laws, which were always a joke, become an absolute farce. A by-product of this process is the rapid development of the tendency to eliminate the small business man. Not all the “defense clinics” or the appointment of Floyd B. Odlum of the huge investment trust, Atlas Corporation, to the task of increasing subcontracts, can conceal the fact that small business men are having increasing difficulty in getting the necessary raw materials. The operation of priorities necessarily means that the big corporations get bigger and the small ones are wiped out. To remain in business today, a manufacturer increasingly finds it necessary to have a private wire to Washington. But this the small business man cannot do, except in rare cases. The big manufacturer, however, has no difficulty at all in getting a hearing in Washington. He is already represented there by the dollar-a-year men. Already, hundreds of small businesses have been forced to the wall. In the next six months, the figure will run into thousands. Even many large corporations are forced to close, at least temporarily, as the transition from a peace economy to a war economy is made. Government experts predict an increase of two million unemployed from this source alone during the next year. In short, a war economy, while it may solve temporarily some of the problems of a dying capitalist order, only accentuates the basic contradictions inherent in capitalism. Lack of space alone prevents a detailed examination of all the economic effects of the developing war economy. Organizationally, the structure of capitalism is being changed in the direction of a far more complete development of state monopoly capitalism. The rapid rise in prices, the astronomical proportions of the government debt, the beginnings of rationing, the introduction of credit controls, the huge expansion of credit through increasing bank loans (accompanied by a decline in excess reserves), the rise of money in circulation to an all-time high – these are some of the indicators of the approaching storm.

Inflationary Dangers Face to face with the threat of an uncontrolled inflation of gigantic proportions, the bourgeoisie stumbles around in its efforts to prevent it like a drunken man on a tightrope. Voluntary measures cannot bring a halt to rising prices. Bootlegging and quality depreciation continue apace. Tax anticipation notes and voluntary savings are a mere soporific. The American bourgeoisie must make up its mind in the course of the next few months to institute rigid price control and forced savings or the inflation will be beyond control. The American ruling class, this means, is squarely confronted with the dilemma: inflation or totalitarianism. There is no escape from this dilemma under capitalism. It is merely a question of time, and the time becomes increasingly short when the American bourgeoisie will be fairly stuck on one of the horns of this historical dilemma. And the worst of it is, from the capitalist point of view, that a pronounced trend in either direction will produce a revolutionary crisis. At present we are confronted with a war economy running, at best, at 0 per cent efficiency. Production still lags way behind the demands of the war situation. Red tape and bureaucracy clog the wheels far more than is necessary under capitalism. The American war economy will become more effective. Of that there can be little doubt, although it may well require actual participation in a shooting war to bring this change about. By 1943–44, perhaps a bit sooner, the dénouément should be reached. And if, by some miracle, American capitalism weathers World War II without any fundamental changes having taken place, it will find that organizing the economy of the western hemisphere and of the entire world is a far more difficult task than that of organizing the domestic economy of the United States. The thought of the transition to a peace-time economy makes the bourgeoisie shudder. And well they may, for a disillusioned and undefeated working class will hardly put up with the only solution the bourgeoisie can offer – a permanent war economy. The war economy cannot be made permanent without the establishment of an American fascism. And this requires far more than defeating Hitler. It means crushing the American workers. Society has come to an absolute impasse, even in the richest and most highly developed of all capitalist countries, the United States. The fetters which bind the forces of production and condemn the overwhelming majority of the population to steadily increasing misery must be cast off. The only road that can avoid chaos and barbarism is the road that Marx outlined as the historic mission of the proletarian – the socialist emancipation of society. Much will undoubtedly happen before the issue is finally joined, but the decade of the 1940s will be decisive in determining whether mankind will march forward toward socialism or continue its relapse into barbarism. Top of page Vance Archive | Trotskyist Writers Index | ETOL Main Page Last updated: 25 October 2014

Vance Archive | Trotskyist Writers Index | ETOL Main Page Walter J. Oakes Toward a Permanent War Economy? (February 1944) Walter J. Oakes, Toward a Permanent War Economy?, Politics, February 1944. Transcribed by Ernest Haberkern (Center for Socialist History, Berkeley, California). Marked up by Einde O’Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL). As this article goes to press, the Wall Street Journal of Jan. 6 carries a lead story which strikingly confirms one of Mr. Oakes’ main points: the scope of the planning now going on for World War III. The Journal’s Washington correspondent writes: The State Department is now considering a big post-armistice stockpile scheme. Under this proposal, which has now reached Secretary Condell Hull, the Government would accumulate a hoard of strategic materials, mostly from imports, over a period of some five years after the war. Goods like crude rubber and industrial diamonds would be stored above ground in warehouses; commodities such as tin and petroleum would be amassed below ground in vaults, mines and subterranean reservoirs. Such a program, say its advocates, would provide a hedge against any future national ‘emergency’ (presumably, the next war). In addition, it would provide a balance for the large-scale American export program that is in prospect for world reconstruction, offering a way for debtor nations to repay public loans advanced by this country. The Journal also reports that Vice-Chairman Batt of the War Production Board, speaking the same day in Chicago, urged adoption of a similar plan. Indicating the idea has had “more than casual official consideration”, Batt suggested it as “a novel means of approaching a balance in our foreign trade picture”. This last argument shows the intimate connection that is coming to exist between war-making and economic stability. The riddle of how the impoverished, relatively backward rest of the world is going to pay for American exports of goods and capital, is neatly solved by importing vast quantities of raw materials and “sterilizing” them, much as the gold at Fort Knox is sterilized, by burying them in stockpiles withdrawn from the market. War and the prospect of war offer the means for performing this useful economic trick. In war modern capitalism has, as this article shows, an economic stabilizer better than pyramids, cathedrals and WPA rolled into one. – Ed. Politics, 1944. AS World War II enters its climactic stage, it becomes increasingly clear that this is not the “War To End All Wars.” Already there have been many warnings of the “possibility of another war.” A growing cynicism is abroad concerning the prospects of durable peace. World War III is not only a distinct possibility, it is inevitable as long as the world’s social structure remains one of capitalist imperialism. As Dorothy Thompson puts it in her column of December 6, 1943, “All grand alliances (referring to the Roosevelt-Stalin-Churchill meeting), have existed only as long as it was necessary to win a war, or protect themselves against the aggressions of other powers. Once all enemies are defeated, the only potential enemies left are members of the grand alliance themselves.” In more scientific terms – the contradictions which led to this war have not been eliminated: if anything, they have been intensified. More revealing than any theoretical analysis concerning its inevitability are the obvious preparations that are now being made for World War III. One may dismiss the psychological preparations, designed to condition the population to accept the inevitability of the next war, as too intangible to evaluate. One may shrug aside the political preparations, which are clearly inherent in the power politics now being played by the leaders of the United Nations, on the ground that this is realpolitik in a materialistic world. But it is impossible to overlook the unanimity with which the business community approves the maintenance of a large standing army, universal military service and an air force second to none as preconditions of America’s “security” in the post-war world. Disarmament, the utopian pipedream of Geneva, is to be abandoned as a slogan after this war – except for the conquered enemy. Important as are the above more or less obvious types of preparation, currently concealed economic preparations are decisive. In the United States, this question is intimately bound up with the problems of reconversion. Much more is at stake than the question of what to do with the huge government-owned war plants (estimated at $20 billion by the end of the war). A plan for reconversion, no matter how loose and flexible, must be guided by some Indication of the type of post-war world that is desired. If war within the life of the next generation is a probability, then it must be planned for on the basis of the lessons learned from this war. American imperialism, for example, has no intention of entering another war without adequate stockpiles of all critical and strategic military materials. And so we have Senate Bill 1582 (introduced early in December 1943 by Senator Scrugham of Nevada) whose stated purpose is: “To assure an adequate supply of strategic and critical minerals for any future emergency by holding intact in the post-war period all stock piles surviving the present war owned by Government agencies and by necessary augmentation thereof primarily from domestic sources.” The “future emergency” is subsequently defined as “a total war of three years’ duration, or of any equivalent emergency.” In the case of copper, an article in the National Industrial Conference Board’s Economic Record (November 1943) reveals what would be involved. “As current usage of copper probably is at least 1.5 million tons annually, a supply for a three-year war, as proposed in the Scrugham bill, might require 4.5 million tons. This amount is nearly equal to the entire domestic output of new copper in the Thirties, or four years’ output at the peak mining rate of 1.07 million tons in 1942.” While the Scrugham bill leaves the question of cost open, it is estimated that the copper program alone would cost well above $1 billion.

Clearly, economic preparations for World War III are beyond the stage of informal discussion. The big question which all discussions of post-war economy try to answer is, of course: How to achieve full employment? The sad experiences following the last war, culminating in the world-wide depression of the 1930s, give the problem an understandable urgency. Public interest in the question is certainly more widespread than ever before. What better tribute to American advertising genius, or what more fitting commentary on the political and economic naivete of the American people, could there be than the $50,000 contest now being held by the Pabst Brewing Company, in commemoration of its 100th birthday, for the best plans to achieve full post-war employment? There is an urgent political necessity for capitalism to achieve the abolition of unemployment. It is motivated by the inevitable slack in private investment in order to maintain the savings-investment equilibrium. Assuming, therefore, that my major thesis is correct and that government balancing operations in the future will consist largely of socially sanctioned war outlays, the question arises: how will the future laws of capitalist accumulation differ from the past? The Future Laws of Capitalist Accumulation In the past, the dynamics of capital accumulation have caused a polarization of classes. (On the one hand, concentration of wealth in fewer and fewer monopoly capitalists; on the other, a steady increase in the size of the working class, both factory and non-factory, relative to other classes). The war, far from interrupting, has accentuated both these trends – in general, at the expense of the middle classes. Although this law will still hold true in the epoch of Permanent War Economy, the increased State military outlays 1 as compared with prewar State expenditures) will have the effect of slowing up the rate of class polarization. This is due not so much to the different economic nature of these expenditures as to their political character. Their purpose, it must be remembered, is to stabilize the economy; i.e., by State intervention to freeze class relations and simultaneously the existing class structure. That is why the post-war size of the labor force and the national income will be considerably below that achieved during the war. Otherwise, the magnitude of post-war war outlays would be at a level so high as virtually to guarantee widespread political opposition on the part of the capitalist class. The major revision that will have to be made in the Marxian analysis of capitalist accumulation is in the famous law, that an increase in capital means an increase in the industrial reserve army. If the Permanent War Economy succeeds in stabilizing the economy at a high level, unemployment will be eliminated, but only through employment in lines that are economically unproductive. Thus capitalist accumulation, instead of bringing about an increase in unemployment, will have as its major consequence a decline in the standard of living. The decline in the standard of living will be similar in nature to that which is just beginning to take place in wartime. For example, until about the middle of 1942 it was possible for the developing American war economy to support a substantial increase in military production at the same time that a small, but significant, rise occurred in average civilian standards of living. This was due, for the most part, to the fact that in 1939 there was considerable underemployment of both men and resources. Once more or less full employment was attained, however, further increases in military production could only be achieved at the expense of the civilian sector of the economy. Most civilians have not yet felt the full impact of this development because of the accumulation of huge inventories of consumers’ goods in the hands of both merchants and consumers. As these inventories are depleted and as consumers’ durable goods wear out, the standard of living begins to decline noticeably. If the war continues throughout 1944, with no significant over-all cutbacks in military programs, the decline is apt to become precipitate. The Permanent War Economy will operate much the same way. At first, of course, there may be a rise in the average standard of living if the levels of national income reached, are reasonably close to those now maintained and if, simultaneously, there is a sharp reduction in total miiltary out lays (inclusive of expenditures for “relief and rehabilitation”). Within a relatively short periGd, however, assuming that the economy is stabilized at the desired level with a minimum of unproductive governmental expenditures, the maintenance of economic equilibrium will require a steadily rising curve of military outlays. The decline in the average standard of living of the workers, at first relative, will then become absolute – particularly on a world scale as all na. tions adapt their internal economies to conform with the requirements of the new order based on an international Permanent War Economy. Naturally, the decline will not be a descending straight line; it will have its ups and downs, but the long-term trend will definitely be downward. Three major assumptions are implicit in the above analysis. First, any significant increases in real national income or total product beyond the reconversion equilibrium level are excluded, due to the capitalist nature of production. This ties in with the reasons why continued accumulation of capital is necessary and why these additional increments of capitalist accumulation require more or less corresponding (socially acceptable) economically unproductive State expenditures. Second, while a portion of the State’s consumption of accumulated unpaid labor may take the form of public works, for reasons previously stated only a minor portion of such public works will be capable of raising the standard of living; and these will decline in importance as direct war outlays increase. Third, the possible effects of alternative fiscal policies (financing through difference:methods of taxation and borrowing ) to support the Permanent War Economy are excluded as not affecting the basic anlysis; although certain methods may markedly accelerate the inflationary process, while others may permit American entry into World War III without having experienced a violent inflation. Capitalist society is forever seeking a “stable and safe” equilibrium – one which eliminates unemployment or, at least, reduces it to negligible proportions (“stable”); and one which is generally acceptable or, at least, politically workable (“safe”).

and one which is generally acceptable or, at least, politically workable (“safe”). This is, of course, hardly a new problem. Instability has been a dominant characteristic of capitalism particularly since technological advances in industry have become marked, a matter of some fifty to one hundred years. It is only in recent years, however, especially since the Bolshevik Revolution plainly demonstrated that capitalism is a mortal society and can be succeeded by a different set of socio-economic institutions, that the problem has taken on a new urgency. Theoretical analysis indicates, and the observations of capitalists confirm, that capitalism would have great difficulty in surviving a depression comparable in severity to the recent one. This must be avoided at all costs, say the more enlightened members of the bourgeoisie, even if far-reaching structural changes are called for. True, this type of motivation has led to fascism and can easily do :so again. It is assumed, however, that the ruling class prefers to stave off the advent of fascism as long as possible, and that there is sufficient evidence to indicate that what I have termed “a Permanent War Economy” is coming to be a much more powerful stimulus than the increasingly-repeated question: “If we can employ everyone in wartime, why can’t we do as much in peacetime?” The fact is that the capitalist system cannot stand the strain of another siege of unemployment comparable. to 1930-1940. It does not require a far-seeing statesman to picture the revolutionary dynamite inherent in a situation where 10-12 million people are unemployed. And this is a conservative estimate of the size of post-war unemployment, if the traditional methods, such as those used after the last war, are followed this time. The traditonial methods (consisting essentially of trying to restore the status quo ante bellum as rapidly as possible) will not be followed. Whether Roosevelt presides over the transition period or not, too much water has flowed under the bridge to permit an uncontrolled post-war inflation followed by a resounding and catastrophic depression. This much, at least, the better minds amongst the capitalists see. The State will have to intervene. It is a question of how much and in what form. Here we encounter a problem in semantics. State intervention, as I shall show below, must take the form of maintaining a Permanent War Economy. What is a “war economy”? In an extreme sense, involving the reduction of civilian standards of living to the bedrock minimum in order to permit the maximum expansion of war output, we have not, of course, a war economy today. Russia, since the consolidation of Stalin’s dictatorship, and Germany, since the consolidation of Hitler’s dictatorship, both in “peace” and in the period of military hostilities, have experienced this type of war economy. They are the only countries in modern times to have experienced a “genuine” war economy, with the possible exception of Japan. A war economy, as I use the term, is not determined by the expenditure of a given percentage of a nation’s resources and productive energies for military purposes. This determines only the kind of war economy – good, bad, or indifferent from the point of view of efficiency in war-making. The question of amount, however, is obviously relevant. At all times, there are some expenditures for war or “national defense.” How much must the government spend for, such purposes before we can say a war economy exists? In general terms, the problem can be answered as follows: a war economy exists whenever the government’s expenditures for war (or “national defense”) become a legitimate and significant end-purpose of economic activity. The degree of war expenditures required before such activities become significant obviously varies with the size and composition of the national income and the stock of accumulated capital. Nevertheless, the problem is capable of theoretical analysis and statistical measurement. Until the present period, in America at least, only one legitimate end-purpose of economic activity has been recognized (in theory) ; namely, the satisfaction of human wants or, less euphemistically, the production and distribution of consumers’ goods and services. In wartime, of course, the legitimacy of war expenditures is never questioned, except by those few who question the progressiveness of the aims of the war. We are now being prepared, however, to recognize as a legitimate economic activity peacetime expenditures for war of a sizable nature. Hereinis lies the real importance of the psychological preparations now under way for World War III. The state will have to spend for war purposes as much as is required to maintain a “stable and safe” equilibrium. As a result, unemployment will be a thing of the past. Barring the immediate outbreak of World War III – i.e., within five years of the end of World War II – the size of post-war war outlays is not significantly influenced by the potential utility of such expenditures for war-making. The decisive consideration is the level of employment that it is desired to maintain. Based on preliminary estimates of national income and capital accumulation in the interim period between World War II and World War III, the United States will achieve a Permanent War Economy through annual war expenditures of from $10-20 billion. Thus, the inner functioning of American capitalism will have been significantly altered, with profound consequences for all classes of society. Why these “balancing” expenditures on the part of government must take the form of war outlays rather than public works requires a brief excursion into the past history of unpaid (surplus) labor. The Problem of Unpaid Labor The root of all economic difficulties in a class society lies in the fact that the ruling class appropriates (in accordance with the particular laws of motion of the given society) a portion of the labor expended by the working class or classes in the form of unpaid labor. The expropriation of this surplus labor presents its own set of problems; generally, however, they do not become crucial for the ruling class until the point is reached where it is necessary to pile up accumulations of unpaid labor.

generally, however, they do not become crucial for the ruling class until the point is reached where it is necessary to pile up accumulations of unpaid labor. When these accumulations in turn beget new accumulations, then the stage of “primitive accumulation” (designed to build up the physical stock of the country for immediate consumption’ rose purposes) ceases and the stability of the society is threatened. The ruling class is impaled on the horns of a most deep serious dilemma: to allow these growing and mature accumulations to enter into economic circulation means to undermine the very foundations of existing society (in modern terms, depression); to reduce or eliminate these expanding accumulations of unpaid labor requires the ruling class or sections of it to commit hara-kiri (in modern terms, the capitalist must cease being a capitalist or enter into bankruptcy). The latter solution is like asking capitalists to accept a 3 per cent rate of profit, because if they make 6 or 10 per cent they upset the applecart and destroy the economic equilibrium. This is too perturbing a prospect; consequently, society as a whole must suffer the fate of economic disequilibrium unless the ruling class can bring its State to intervene in such a manner as to resolve this basic dilemma. Since a class society can support on a relatively stabled it basis a certain amount of accumulated unpaid labor, the problem becomes one of immobilizing the excess. State intervention is required precisely because no individual member of the ruling class will voluntarily give up the opportunity to accumulate further wealth. The State, therefore, acts in the interests of all the members of the ruling class; the disposition of the excess accumulated unpaid labor is socially acceptable, and generally unnoticed by individual members of the ruling class. Such, for example, was the role performed by pyramid-building in Ancient Egypt, the classic example of a stable economy based on the institution of chattel slavery. In feudal society, based on the accumulation of unpaid labor through the institution of serfdom, an analogous role was performed by the building of elaborate monasteries and shrines. These lavish medieval churches were far more than centers of worship and learning, or even than examples of conspicuous expenditure on the part of the ruling classes; they were an outlet for the unpaid labor of feudal society – an outlet which permitted a deadening economic equilibrium for centuries. Capitalist society, of course, has had its own pyramids. These ostentatious expenditures, however, have failed to keep pace with the accumulation of capital. In recent times, the best examples have been the public works program of the New Deal and the road building program of Nazi Germany. Both have been accomplished through what is termed “deficit financing.” That is, the state has borrowed capital (accumulated surplus labor for which there is no opportunity for profitable private investment) and consumed it by employing a portion of the unemployed millions, thus achieving a rough but temporarily workable equilibrium. While the Roosevelt and Hitler prewar “recovery” programs had much in common, there is an important difference. The latter was clearly a military program; all state expenditures were calculated with a direct military use in view. As such, they did not, for the most part, conflict with the direct interests of the capitalist class of Germany who wished to reserve for private capital all opportunities for profitable investment. In the United States, only a minor portion of the WPA and PWA programs possessed potential military usefulness. Consequently, as such expenditures increased, the opposition of the capitalist class rose (this was basically an economic development, although the psychological impetus afforded by recovery from the depths of depression undoubtedly aided the process). The more money the state spent, the more these expenditures circumscribed and limited the opportunity for profitable private investment. The New Deal was dead before the war; the war merely resuscitated its political expression and was, in reality, an historical necessity. War expenditures accomplish the same purpose as public works, but in a manner that is decidedly more effective and more acceptable (from the capitalist point of view). In this, capitalism is again borrowing from the techniques employed by the more static class societies of slavery and projects were officially counted among the unemployed. Today, however, not only are those engaged in producing the instruments of war considered to be gainfully employed; even those in the armed forces are classified as part of the employed labor force. It is only necessary to perpetuate into the post-war period this type of bookkeeping which classifies soldiers and munitions workers as “employed,” and then war (“national defense”) outlays become a legitimate end-purpose of economic activity; a Permanent War Economy is established and socially sanctioned; capitalist society is safely maintained – until the next war. Capital Accumulation and State Intervention Perhaps the most distinctive feature of capitalist society – in comparison with earlier class societies, and at the same time that which indicates its superiority over these earlier forms – is the rapidity with which wealth is accumulated. Alternating periods of rising and falling business activity have resulted and have come to be accepted as an inevitable and peculiarly capitalist feature of the accumulation of capital. This was, at least, the situation prior to World War II. To understand the basic laws of motion of capitalist society required the application of the fundamental Marxian concepts of the increasingly high organic composition of capital and the falling average rate of profit. With these tools Marx predicted, and one could analyze, the results of capitalist accumulation. The Marxian general law of capitalist accumulation may, for convenience, be expressed as two laws; namely, the inevitable tendencies toward the polarization of classes and the increase in unemployment. Today, however, this analysis no longer holds good without certain modifications. The new element in the situation is clearly the fact that the entire present period (in the United States, beginning with the advent of the Roosevelt Administration) is one of increasing State intervention.

The new element in the situation is clearly the fact that the entire present period (in the United States, beginning with the advent of the Roosevelt Administration) is one of increasing State intervention. New forces are set in motion and new laws or trends are discernible. The war both obscures and highlights these basic changes in the functioning of capitalism. The role of the State is obviously increased, but the conduct of the war gives rise to the illusion that this is a temporary affair. But the government cannot spend upwards of $300 billion on war expenditures, acquiring ownership of huge quantities of facilities, raw materials and fabricated goods, without having a profound and lasting effect on the body economic. How to dispose of an anticipated $75 billion of government assets at the end of the war is one of the more perplexing questions troubling the best minds among the bourgeoisie today. If the Republicans are victorious in the 1944 elections, it is conceivable that they might try to restore the status quo ante bellum. Reversing an economic trend, however, is far more difficult than reversing a political trend. Destroying or immobilizing $75 billion of government assets is qualitatively a different proposition than the situation which existed at the end of World War I. It would be impossible to do this, and at the same time to maintain employment at a high level and to carry through the international plans of American imperialism. Any such Republican experiment will necessarily be short-lived. As for the Roosevelt Administration – it seems to be “sold” on the Keynesian proposition that public investment must take up the inevitable slack in private investment in order to maintain the savings-investment equilibrium. Assuming, therefore, that my major thesis is correct and that government balancing operations in the future will consist largely of socially sanctioned war outlays, the question arises: how will the future laws of capitalist accumulation differ from the past? The Future Laws of Capitalist Accumulation In the past, the dynamics of capital accumulation have caused a polarization of classes. (On the one hand, concentration of wealth in fewer and fewer monopoly capitalists; on the other, a steady increase in the size of the working class, both factory and non-factory, relative to other classes). The war, far from interrupting, has accentuated both these trends – in general, at the expense of the middle classes. Although this law will still hold true in the epoch of Permanent War Economy, the increased State military outlays i as compared with prewar State expenditures) will have the effect of slowing up the rate of class polarization. This is due not so much to the different economic nature of these expenditures as to their political character. Their purpose, it must be remembered, is to stabilize the economy; i.e., by State intervention to freeze class relations and simultaneously the existing class structure. That is why the post-war size of the labor force and the national income will be considerably below that achieved during the war. Otherwise, the magnitude of post-war war outlays would be at a level so high as virtually to guarantee widespread political opposition on the part of the capitalist class. The major revision that will have to be made in the Marxian analysis of capitalist accumulation is in the famous law that an increase in capital means an increase in the industrial reserve army. If the Permanent War Economy succeeds in stabilizing the economy at a high level, unemployment will be eliminated, but only through employment in lines that are economically unproductive. Thus capitalist accumulation, instead of bringing about an increase in unemployment, will have as its major consequence a decline in the standard of living. The decline in the standard of living will be similar in nature to that which is just beginning to take place in wartime. For example, until about the middle of 1942 it was possible for the developing American war economy to support a substantial increase in military production at the same time that a small, but significant, rise occurred in average civilian standards of living. This was due, for the most part, to the fact that in 1939 there was considerable underemployment of both men and resources. Once more or less full employment was attained, however, further increases in military production could only be achieved at the expense of the civilian sector of the economy. Most civilians have not yet felt the full impact of this development because of the accumulation of huge inventories of consumers’ goods in the hands of both merchants and consumers. As these inventories are depleted and as consumers’ durable goods wear out, the standard of living begins to decline noticeably. If the war continues throughout 1944, with no significant over-all cutbacks in military programs, the decline is apt to become precipitate. The Permanent War Economy will operate much the same way. At first, of course, there may be a rise in the average standard of living if the levels of national income reached are reasonably close to those now maintained and if, simultaneously, there is a sharp reduction in total miiltary outlays (inclusive of expenditures for “relief and rehabilitation”). Within a relatively short peric,d, however, assuming that the economy is stabilized at the desired level with a minimum of unproductive governmental expenditures, the maintenance of economic equilibrium will require a steadily rising curve of military outlays. The decline in the average standard of living of the workers, at first relative, will then ] become absolute – particularly on a world scale as all nations adapt their internal economies to conform with the I requirements of the new order based on an international Permanent War Economy. Naturally, the decline will not i be a descending straight line; it will have its ups and downs, but the long-term trend will definitely be downward. Three major assumptions are implicit in the above analysis. First, any significant increases in real national income or total product beyond the reconversion equilibrium level are excluded, due to the capitalist nature of production. This ties in with the reasons why continued accumulation of capital is necessary and why these additional increments of capitalist accumulation require more or less corresponding (socially acceptable) economically unproductive State expenditures. Second, while a portion of the US State’s consumption of accumulated unpaid labor may take the form of public works, for reasons previously stated only a minor portion of such public works will be capable of raising the standard of living: and these will decline in importance as direct war outlays increase.

Third, the possible effects of alternative fiscal policies (financing through difference methods of taxation and borrowing) to support the Permanent War Economy are excluded as not affecting the basic anlysis; although certain methods may markedly accelerate the inflationary process, while others may permit American entry into World War III without having experienced a violent inflation. Capitalist society is forever seeking a “stable and safe” equilibrium – one which eliminates unemployment or, at least, reduces it to negligible proportions (“stable”) ; and one which is generally acceptable or, at least, politically workable (“safe”). This is, of course, hardly a new problem. Instability has been a dominant characteristic of capitalism particularly since technological advances in industry have become marked, a matter of some fifty to one hundred years. It is only in recent years, however, especially since the Bolshevik Revolution plainly demonstrated that capitalism is a mortal society and can be succeeded by a different set of socio-economic institutions, that the problem has taken on a new urgency. Theoretical analysis indicates, and the observations of capitalists confirm, that capitalism would have great difficulty in surviving a depression comparable in severity to the recent one. This must be avoided at all costs, say the more enlightened members of the bourgeoisie, even if far-reaching structural changes are called for. True, this type of motivation has led to fascism and can easily do again. It is assumed, however, that the ruling class preftts to stave off the advent of fascism as long as possible, and that there is sufficient evidence to indicate that what I have termed “a Permanent War Economy” is coming to be regarded as a feasible, even if temporary, alternative to fascism. The P.W.E in Action – A Look Ahead How will the Permanent War Economy operate? Can it achieve the “stable and safe” equilibrium? It is possible to chart the major outlines of the functioning of the Permanent War Economy. The assumptions underlying this projection are listed below in outline form without any attempt at justification. They are grouped under three broad headings, as follows: MILITARY The European phase of World War II will end late in 1944. The Asiatic phase of World War II will end late in 1945. While some demobilization will take place with the defeat of Germany, the major transition will occur in fiscal 1946. World War III will occur in 1960. INTERNATIONAL Conduct of world affairs in the interim period between World Wars II and III will be in the hands of the United States, Great Britain, and Russia, with American imperialism the dominant partner. No successful proletarian revolution will take place. Stalinism will successfully maintain itself in power in Russia. A form of international “grossraumwirtschaft” will govern economic relations among the major economic regions of the world. There will be a limited restoration of international trade based on direct and open State intervention. DOMESTIC ECONOMY (all dollar figures in 1943 prices) The national income will vary within the limits of $120-150 billion, averaging around $135 billion. There will be a gross national product of $140-180 billion, with an average of about $160 billion. The dangerous margin of excess capital accumulations (over and above private capital formation) will run between $20–25 billion. Private capital formation will reach about $10 billion in 1947, declining to approximately $5 billion in 1952 and thereafter levelling off at this rate. Government war outlays will average about $15 billion, with probable limits of $10–20 billion the trend will be toward the upper limit as World War III approaches. The national debt in 1946 will be close to $250 billion, increasing thereafter at an annual rate of $5–10 billion. The employed labor force will be stabilized at about 50 million persons additions; due to the growth of population of working age are ignored, as it is unlikely that they will be substantial enough to alter the picture. While it is probable that productivity of labor will increase, this factor is omitted from consideration as being too difficult to estimate and, in any case, unlikely to affect the basic analysis. There will be a steady, but somewhat falling rate of interest. The propensity to consume will remain fairly constant. The rate of profit will be sustained at a level comparable to the best prewar years, its tendency to decline being offset by increasing State intervention and a relatively minor increase in the rate of surplus value. On the basis of these assumptions, the table below of the movement of capital accumulation, government war outlays, the average standard of living and average real wages of the working class ander the Permanent War Economy follows logically. 1947 is chosen as the base year, for this is assumed to be the first “normal” post-war year. 1946 is considered as a year of transition. The concepts are presented in index ambers in order to show bask trends under the Permanent War Economy. Thus, according to the chart, the critical period will be 1934–1936. It Is at this time that the inherent contradictions of capitalism will begin to threaten seriously the newly-found economic stability, pushing society rapidly in the direction of World War Minor divergences will not materially affect the validity of the assumptions. This is particularly true of assumptions 1–9 and 17–20, which are really political and economic generalizations. For example, the analysis still holds true even World War III should take place in 1965 or 1970, rather than, as predicted, in 1960.

For example, the analysis still holds true even World War III should take place in 1965 or 1970, rather than, as predicted, in 1960. Assumptions 10–16 are of a an entirely different character. Here, substantial differences in magnitude might render the forecasts useless. But 12, 13, 14 and 16 require explanation. The others conform rather closely to most predictions now being made. The figure stated in assumption 12, taken together with that stated in assumption 13, is only slightly above the estimate made by Professor Alvin Hansen (one of the outstanding authorities in this country on the theoretical aspects of investment policy) of $20–25 billion as the amount necessary to be invested in the post-war period. The level indicated have would be $30 billion, hardly a significant difference. Assumption 13 provides for private capital formation is perfectly consistent wih the hest prewar years starting with the history of capitalism since it entered the phase of permanent crisis. Assumption 14 will appear very high to those who view the post-war situation in the same manner as the prewar situation. An interesting confirmation of the estimate made here appears in the October 1943 issue of the National Industrial Conference Board’s Economic Record in an article entitled Postwar Budget Prospects: 1945–1948: While all the figures for future years are necessarily speculative, they are particularly so for national defense expanditures in the post-war period. Armed forces numberimg 1 million lee would constitute a smaller number than are assionsed in some quarters. If the size of the armed services should be nearer to 2 million, expenditures of about $7 billion would seem to be more nearly the level of our peacetime defense expenditures than the $4 billion shown for l948. The natureand the extent of equipment that would be used by our armed forces in the post-war era could account for variations in expenditures of several billion dollars a year. (My italics – W.J.O.) A total military establishment of 2 million appears to be conservative in the light of plans for occupation and policing forces, plus conscription of the youth. Equipment and supplies for this size military force should easily reach $10 billion. Stockpiling and other military outlays, direct and indirect, appear to be quite capable of raising the total to $20 billion, the upper limit in the assumption. The average of current estimates regarding the probable size of the post-war labor force is about 55 million persons. Assumption 16, therefore, is considerably below prevailing estimates; for if the difference of 5 million were to constitute unemployment in any genuine sense of the term, it is obvious that the Permanent War Economy would not be, fulfilling its main function. 50 million is a more realistic figure than 55. It is higher than all prewar records, although it is some 13 million below the current peak o about 63 million (which includes those in the armed forces) The translation of those in the armed forces into active members of the labor force, is subject to shrinkage which depending on battle casualties and related factors, should run between 1 and 2 millions. Net retirements, due to the excess of over-age people leaving jobs as compared with new entrants, should be close to 3 million. The balance of 8 million represents women who are temporary war worker and are expected to leave the employed labor force once the war is over. This figure includes current child labor and is therefore not much higher than generally accepted “guess-timates.” The assumptions upon which the operations of the Permanent War Economy are predicated thus appear to be realistic. Among the many problems which will remainare two outstanding and closely related ones: can class relations be frozen, and can disastrous inflation be prevented. Each requires a separate article, to be adequately discussed. The first, as I have indicated, is directly related to the pre cess of capitalist accumulation in the post-war period. It depends not only on many political factors but on severa economic ones, the most important of which is clearly the question of inflation. It is not my belief that the Permanent War Economy wit provide an enduring solution for capitalism. But it can work for the period under consideration; and there is like wise no reason why appropriate fiscal policies (from the point of view of the capitalists, which means anti-working class in essence) will not be successful in preventing out right inflation. The national debt, astronomical as it mar seem, presents no serious problem. Assuming an annual interest burden of $7 billion, a very generous estimate, this will easily be covered out of current tax receipts. It is the type, as well as the amount, of taxes to be levied that will constitute one of the major areas of political and class conflict. The question is made still more acute by the fact that inflation appears to offer the bourgeoisie an easy way out to unload the cost of the war onto the backs of the working masses of the population. A policy of this kind however, cannot be drifted into; it must be adopted consciously. If the die is now, or soon to be, cast in favor of deliberate and uncontrolled inflation, this can only mean that the decisive section of the ruling class is determined to establish fascism as soon as possible. I see no evidence at present, to warrant this belief although, of course, there are many similarities between fascism and the Permanent War Economy. The danger of inflation is not diminished by a Permanent War Economy; on the contrary, it is steadily increased. But it seems more probable that the inflation-fascism sequence is a contender for a prime place on the agenda after World War III than in the post-World War II period. Labor’s Responsibility It is not likely that the above analysis, necessarily presented in sketchy, outline form, will meet with any enthusiastic reception. For one thing, it runs counter to all currently organized and clearly defined bodies of political thought.

For one thing, it runs counter to all currently organized and clearly defined bodies of political thought. Orthodox Marxists (Trotskyists) have convinced themselves that only a successful proletarian revolution can end this war; otherwise fascism will rule the post-war world. New Dealers want to restore “free competition” and make capitalism humane; the only practical note amidst their absurdities is the attempt to win a fourth term for Roosevelt. Social Democrats are still for socialism in theory and capitalism in practice. In fact, all capitalist (and Stalinist) political thought will deny the possibility of a Permanent War Economy, although they will support measures leading toward its establishment. Moreover, the imagination, courage and capacity of the human mind to project itself forward in an hour of deep social crisis and deal with reality instead of illusion has not been a very noticeable characteristic of the human species. Nevertheless, this war, which has already destroyed so many cherished illusions, will destroy many more before it is consigned to the history texts. The drift of events is toward a Permanent War Economy. What better solution has capitalism to offer? And what likelihood of an anti-capitalist solution is there at present? What may now seem fantastic to many will, as the present war draws to a close, appear to be obvious as the evidence piles up. Upon the shoulders of the labor movement rests the real responsibility for preventing World War III. This universally-approved objective can never be achieved by the Roosevelts, Churchills, Stalins, or Chiang Kai-Sheks of this or the next decade. For the labor movement, especially its socialist-minded sector, to stand a chance to prevent the atomization of society as a result of repeated wars requires much closer and more realistic study of what is actually happening in the world today than has yet been evidenced. The basic strategic aim of socialism as the only rational alternative to capitalism needs no revision except that of modernization. It is in the field of tactics that substantial revisions are needed. A declining standard of living under a Permanent War Economy cannot be successfully fought by a labor movement whose most powerful organizations are trade unions, no matter how powerful these may be. The important battle areas will be abstruse (to the masses) economic questions, such as the size and composition of the Federal budget, taxation and fiscal policy, investment alternatives, and the like, rather than wages, profits and working conditions for specific industries or factories. These latter will still be important, to be sure, but they will largely be determined by the decisions affecting the former. This points to the necessity not only of widespread mass economic education, but of the vital need for an independent political Party of labor. Only a labor party, independent of capitalist political machines, and based upon trade unionists, is capable of coping with the problems of living under a permanent war economy. Top of page Vance Archive | Trotskyist Writers Index | ETOL Main Page Last updated: 16 August 2019

Vance Archive | Trotskyist Writers Index | ETOL Main Page T.N. Vance An Amalgam of Marx and Keynes John Strachey’s View of Contemporary Capitalism (August 1957) T.N.Vance, An Amalgam of Marx and Keynes, The New International, Vol. XXIII No. 3, Summer 1957, pp. :170–179. Transcribed by Ted Crawford. Marked up by Einde O’Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL). If capitalism (i.e. advanced capitalism such as Britain and America) can through the exercise of non-economic democratic political pressures be reformed or so controlled in its operations that progressively the average standard of living is raised, the capacity of the productive forces increased, and some type of peace maintained, then what is the need for any type of socialist movement? This question insistently intrudes itself after a reading of John Strachey’s Contemporary Capitalism [1], despite the fact that at the end of his Acknowledgments, the author states: “Contemporary Capitalism is the first volume of a projected series of studies on the principles of democratic socialism.” In fact, so many projected studies are indicated in the course of this one volume, that one must wish Strachey an exceptionally long life in order that he may set forth in writing his magnum opus. For, despite numerous disagreements that this writer has with many ideas expressed by Strachey, he is discussing questions of fundamental importance in a serious manner. Moreover, Strachey is aware that capitalism through a process of mutation, as he calls it, has changed fundamentally. In addition, while rejecting many of Marx’s principles, others are accepted. There are far too few analyses of contemporary society from the standpoint of democratic socialism to ignore Strachey because his economics are based on a curious amalgam of Marx and Keynes or because his politics appear to be acceptable to Bevan. Contemporary capitalism, according to Strachey, has succeeded in raising the average standard of living’ because of trade union and leftist (democratic) pressures. Now, however, with the stage of oligopoly having been reached, there is a conflict between capitalism and democracy. “Capitalism in its latest stage, when it is progressively outgrowing the forms of ownership which were once appropriate to it, threatens to turn upon what was once its own political counterpart, namely, democracy.” (p. 344) It is the fact that capitalism through ever-increasing centralization constantly undermines the foundations of democracy that necessitates the struggle for socialism, according to Strachey It is his belief that only democratic socialists are the true fighters for democracy. The struggle for socialism is in reality the struggle for democracy. And, despite Strachey’s failure to distinguish clearly between democracy and democratic rights and between bourgeois and socialist democracy, it must be admitted that there is much truth in this dichotomy If all classes in modern society before capitalist and Stalinist, were prepare to accept indefinitely the absence of democratic rights, then it is theoretically conceivable that a precarious international equilibrium could be maintained indefinitely. The apposition between capitalism and democracy is, in reality, the basic constructive theme of Strachey’s work. Among many quotable sentences of author’s thesis is the following “Thus the continuance of effective democracy depends upon the protection of big capital’s control of the media of expression becoming absolute. And upon the continuance of effective democracy in two or three key societies of the world everything else will be found to depend.” It is interesting to note Paul Homan’s evaluation of Strachey in a article in the June 1957 issue of The American Economic Review, Socialist Thought in Great Britain: Strachey has now taken time out for reflective thought; his book is a restatement of his philosophical position and a misinterpretation of the process of social change. The title is somewhat misleading, because the book contains very little on the institutional characteristics of contemporary – economic organization – in fact, hardly more than a stereotype of oligopoly. What he does, essentially, is to set up two abstract creatures, capitalism and democracy, put them in the prize ring and let them fight it out, while he cheers in the corner of democracy. Capitalism is a sort of brutal monstrosity – the apotheosis of every inhumane, anti-social pursuit of private self-interest. Democracy is the champion of all generous-hearted efforts to attain general well-being and communal interest. The complete victory of democracy, would usher in socialism. The professor’s sarcasm is not well taken for Strachey does have an analysis of the laws of motion of contemporary capitalism. Even if one disagrees with Strachey, which this reviewer does in certain fundamental respects that will be set forth below, the fact of the matter is that Strachey in thinking about important problems, which is more than most professors of economics permit themselves to do these days. Strachey is also to be commended for realizing the importance of theory. He knows that capitalism has altered in certain of its basic characteristics in certain aspects of its functioning. He is not content with superficial description of these structural alterations, important though they may be. He wants to know “why.” He wants to be able to predict. In short, he seeks a theory of the latest stage of capitalism that will serve as a guide to action. Again, the fact that Strachey has exchanged his prewar Stalinist theories for his current amalgamation of Marx and Keynes, is hardly justification for rejecting him out of hand. In fact, how immeasurably superior is Strachey’s crude analysis of contemporary capitalism to the apologetics of bourgeois professors!

In fact, how immeasurably superior is Strachey’s crude analysis of contemporary capitalism to the apologetics of bourgeois professors! Strachey’s beginning is most encouraging, for he realizes that the wholesale modifications of the market that have occurred in recent years have led capitalism into a new stage. As he says, “The first and decisive reason why an economy of large and few units exhibits new characteristics is because at a certain point in the increase of their size and decrease of their number, the managers of the remaining units begin to be able to affect prices instead of being exclusively affected by them. It is impossible to exaggerate the importance of this transformation.” (p. 22, italics mine – T.N.V.) While he uses different terms, Strachey is aware of the development of state monopoly capitalism and the era of administered prices that it has ushered in, and to a certain extent of its consequences. For example (p. 31): “Accordingly, the State has come, in the advanced industrial nations, to feel that it must, and can, control such basic things as the pattern of the distribution of income between social classes and individual citizens, instead of leaving that pattern to the consequences of the play of the market.” To examine each and every argument presented by Strachey, both those with which we concur as well as those with which we disagree, as well as to indicate significant areas of omission, would require a book rather than a review article. Suffice it to say that we believe Strachey to be fundamentally correct in his emphasis on the importance of prices now being administered in large measure, rather than determined competitively in the market. The “essence of the mutation,” as the author describes it, is (p. 39): “the ability of the producers in some, but not in all, of the spheres of production to affect prices, instead of merely being affected by them ... Thus the ability to influence prices will inevitably sap the automatic, self-regulating character of the economy. It will consequently provoke and require more and more State intervention, and will lead to an intensified struggle for the now all-important levers of economic power which will be in the hands of the State ... Thus the characteristics of the latest stage of capitalism both make possible a much higher degree of social control and at the same time make such control imperative.” his is insight and understanding of a high order. Strachey devotes an important section of his book to value theory in economics. While he accepts Marx’s analysis of the centralization of capital, accepting as he does the term “oligopoly” from modern bourgeois economists, he rejects the labor theory of value as faulty and the theory of ever-increasing misery as Marx’s cardinal error. Strachey notes that from Ricardo on increasing disparities occurred between the price and value of many commodities. He feels that the labor theory of value has neglected to take into account the role of capital in the determination of prices. He states (p. 67): “In other words, in real life not only man-hours of socially necessary labor but also a reward of some sort for capital entered into the determination of the points round which prices fluctuated.” (Italic in original) Why Strachey is under the mistaken notion that Marx ignored the role of constant capital in the determination of the price of production and henceforth of market price is a complete mystery, since he merely makes the assertion, whereas Marx devoted large part of Volume III of Capital to an explanation of these interrelationships in connection with capitalist production as a whole. The skeptics are referred merely to Chapter of Volume III, although Kautsky will serve as a good introduction. Consider just the following two paragraphs from the first chapter on Cost, Price and and Profit (Capital, Kerr edition, Volume III, pp. 38–39) However, the cost of this commodity to the capitalist, and the actual cost of this commodity, are two vastly different amounts. That portion of the value of the commodity which consists of surplus value does not cost the capitalist anything for the reason that it costs the laborer unpaid labor. But on the basis of capitalist production, the laborer plays the role of an ingredient of productive capital as soon as he has been incorporated in the process of production. Under these circumstances the capitalist poses as the actual producer of the commodity. For this reason the cost price of a commodity to the capitalist producer necessarily appears to him as the added cost of the commodity. If we designate the cost-price by k, we can transcribe the formula C=c+v+s into the formula C=k+s, that is to say, the value of the commodity is equal to the cost plus the surplus-value. In this way the classification of the various values making good the values the capital consumed in the production of the commodity under the term one price expresses, on the one hand, the specific character of capitalist production. The capitalist cost of the commodity is measured by the expenditure of capital, while the actual cost of the commodity is measured by the expenditure of labor. The capitalist cost-price of the commodity, then, is a quantity different from its Value, or its actual cost-price. It is smaller than the value of the commodity. For since C=k+s, it is evident that k=C−s. On the other hand, the cost-price of a commodity is by no means a mere heading in capitalist bookkeeping. The actual existence of this portion of value continually exerts its practical influence in the actual production of the commodity, because it must be ever re-converted from its commodity-form, by way of the process of circulation, into the form of productive capital, so the cost-price of the commodity must always buy anew the elements of production consumed in its creation. (Italics in last sentence only mine. – T.N.V.) How could the originator of the theory of the increasing organic composition of capital ignore the role of capital in the determination of price? Strachey ought to acquire his economics first-hand rather than through the courtesy of Joan Robinson. Implicitly, Strachey has fallen into the common bourgeois fallacy of “productivity of capital” as distinct from “productivity of labor.” And, if he thinks he can explain the origin of profit without recourse to the labor theory value, the bourgeoisie have been trying unsuccessfully for a hundred years to develop a theory that would both explain the origin of and justify profit, and at the same time correspond to reality.

Implicitly, Strachey has fallen into the common bourgeois fallacy of “productivity of capital” as distinct from “productivity of labor.” And, if he thinks he can explain the origin of profit without recourse to the labor theory value, the bourgeoisie have been trying unsuccessfully for a hundred years to develop a theory that would both explain the origin of and justify profit, and at the same time correspond to reality. It might be added that the absence of a theory of profit creates numerous difficulties for Strachey, of which he seems to be totally unaware. He does understand that the accumulation of capital is the mainspring of capitalism (cf. Chapter 10), but why capital is accumulated or the laws governing its accumulation he doesn’t know because Mrs. Joan Robinson, his mentor, does not know. It is sufficient to quote the following from p. 247): “What in the world, then, determines the level of investment? Mrs. Joan Robinson, in a striking passage (from her The Accumulation of Capital), declares simply that we do not know! She writes: ‘... as to what governs the level at which it’ (investment) ‘gets itself established we know very little ...’” Mrs. Robinson is here feeling the need of some kind of summa, transcending, although including, economics and laying the basis of an inclusive science of human society, a summa at which Marxism is at present the sole attempt. She is confronted with the fact that her analysis has led her to conclude that the true prime mover of a capitalist economy – the decision to invest – is determined by causes which are largely outside the scope of economic analysis. The absence of a theory, even a much-abused Marxist theory, leads to all kinds of difficulties. Above all, if the government, through fear of the electorate or whatever motivation one wants, decides that slumps must be avoided at all costs, and that consequently the decisions to invest (i.e. the determination of the rate and mass of capital accumulation) cannot be left in the hands of profit-seeking private capitalists, and if further this can be achieved under bourgeois democracy or under a “labor” government, then why is there a need for socialism? Intuitively, Strachey feels that he must reject the labor theory of value, not because he (Strachey) does not understand it, but because he wishes to attribute to Marx an “iron law” or subsistence theory of wages as an out-growth of the labor theory of value, and hence a failure to allow for increasing productivity of labor and consequently to deny the possibility and the actuality of increasing the national product and the average standard of living. The original sin of the labor theory of value thus becomes the source of the disastrous theory of ever-increasing misery. Strachey puts it this way (p. 70): “Reckoning in terms of man-hours of socially necessary labor, the total national product is a given figure: all that can really be considered is its division between the social classes.” (Italics in original). Why this should be so when the amount of socially necessary labor required to produce the means of sustenance of labor or for labor to reproduce itself, i.e. the value of labor-power, is clearly dependent on the general historical and specific geographic environment, is not explained by Strachey. He merely asserts it. It is as if he never bothered to read Marx, for just reading the first few hundred pages of Volume I of Capital would have destroyed his entire fallacious attack on Marx’s development of the labor theory of value and surplus value. Let Marx speak for himself (Volume I, pp. 189–190): The value of labor-power is determined, as in the case of every other commodity, by the labor-time necessary for the production, and consequently also the reproduction, of this special article. So far as it has value, it represents no more than a definite quantity of the average labor of society incorporated in it. Labor-power exists only as a capacity, or power of the living individual. Its production consequently presupposes his existence. Given the individual, the production of labor-power consists in his reproduction of himself or his maintenance. For his maintenance he requires a given quantity of the means of subsistence ... the value of labor-power is the value of the means of subsistence necessary for the maintenance of the laborer ... His means of subsistence must therefore be sufficient to maintain him in his normal state as a laboring individual. His natural wants, such as food, clothing, fuel, and housing, vary according to the climatic and other physical conditions of his country. On the other hand, the number and extent of his so-called necessary wants, as also the modes of satisfying them, are themselves the product of historical development, and depend therefore to a great extent on the degree of civilization of a country, more particularly on the conditions under which, and consequently the habits and degree of comfort which, the class of free laborers has been formed. In contradistinction therefore to the case of other commodities, there enters into the determination of the value of labor-power a historical and moral element. (Italics mine – T.N.V.) In other words, since, by way of illustration, England is more civilized than, let us say, South Africa, and Strachey is accustomed to a greater degree of comfort than the South African miner, presumably the value Strachey’s means of subsistence (or of the British miner) exceeds that of the South African. And the value of the means of subsistence required for Mr.

And the value of the means of subsistence required for Mr. John Strachey today, or the British miner today, clearly is far greater than the value of the means of subsistence required for, say, Mr. Lytton Strachey some decades ago or that of a British miner a generation or more ago. Marx was certainly guilty of many mistakes. He certainly didn’t foresee that capitalism would survive decades beyond the point where it clearly outlived its social usefulness. He also could not have been expected to have foreseen the Bolshevik revolution and the Stalinist counter-revolution. But surely before his basic thoughts are twisted and distorted, he has the right to assume that his critics (friendly they may be in the case of Strachey) will at least have made an effort to read and understand his works! Strachey, however, is not concerned with what Marx wrote. He has a point to make: “Therefore a subsistence theory of wages has always been, explicitly for Ricardo, explicitly for Marx, an essential part of labor theory of value. But wages have not remained at subsistence. Therefore one vitally important commodity namely, labor power, has not even tended to sell at its value. This formidable fact has driven a great hole, not only in the labor theory of but also in the associated Ricardian-Marxian diagram of what the distribution of the national product will be among the classes. It is the fact of rising real wages which has above all done the damage to the whole schema.” (Italics mine – T.N.V.) It would be pretty difficult to crowd more errors into one short paragraph than Strachey does in the above. To be sure, the very next two sentences read (p. 71): “Nevertheless we shall find that it has by no means destroyed its importance as an elucidation of would happen unless tireless and drastic steps were taken to prevent. That, I repeat, is one of the reasons why it is still indispensable to master the labor theory of value.” (sic) It is a pity that Strachey has not followed his own advice, for one thing he cannot be accused of is having mastered the labor theory of value. In passing, it should be obvious Strachey’s attributing to Marx on an “iron law” of wages requires him also to ignore the fact that Marx developed the theory of the class struggle. To summarize Marx’s central message, as does Strachey (p.102): “This is the statement that wages will in all capitalist societies tend towards what is for that time and phase a subsistence level” – which implies the influence of historical forces upon the determination of wages – and to deny the influence of the class struggle upon the level of wages, is to perpetrate an absurdity. To be sure, the forces of the class struggle cannot drive wages up to the point where for any length of time the profits of the capitalist class disappear without at the same time destroying capitalism. To assert that Marx ignored the possibility that the productivity of labor could alter or increase is enough to make Marx turn over in his grave. Marx even devotes an entire chapter of Volume I of Capital to Changes of Magnitude in the Price of Labor-Power and in Surplus-Value (Chapter XVII), wherein he considers as the three decisive forces in determining these changes: “(1) the length of the working day, or the extensive magnitude of labor; (2) the normal intensity of labor, its intensive magnitude, whereby a given quantity of labor is expended in a given time; (3) the productiveness of labor, whereby the same quantum of labor yields, in a given time, a greater or less quantum of product, dependent on the degree of development in the conditions of production.” (p. 569). While Strachey pays homage to Marx for being the first to throw light on the business cycle, with his theory of crisis, Marx’s basic achievement was to analyze the conditions that led to, and to predict, the centralization of capital. His basic error was to assert the labor theory of value as a law rather than as a tendency. And the thing which destroys Marxism as a valid social theory is that from this labor theory of value, instead of merely asserting a tendency toward a polarization of classes, Marx predicted “ever-increasing misery” for the mass of the population. And it was this “ever-increasing misery” that would lead the masses to the revolutionary overthrow of capitalism. Since, according to Strachey, in the advanced capitalist nations, the average standard of living has increased, there is no ever-increasing misery and, consequently, Marxism is outmoded as a scientific basis for socialism. There is, says Strachey, to be perfectly fair to Marx, atendency under capitalism for the entire increase in production to accrue to the benefit of the capitalist class, “But this tendency has been overruled, in the advanced capitalist societies, but not elsewhere, by essentially non-economic forces, the existence of which Marx overlooked.” (Strachey’s emphasis, p. 129.) What Marx meant by the increasing pauperization of labor (a thought which cannot be found in Capital, but only in The Communist Manifesto and certain propagandistic works) is not quite as simple as Strachey thinks. The evidence would seem to indicate that Marx based this prediction on his basic law of capital accumulation; namely, that an increase in capital accumulation leads to an increase in the industrial reserve army (unemployment). That this tendency still exists, even under the Permanent War Economy, we have shown in our original series of articles on the Permanent War Economy (cf. The New International, Vol. XVII). Nevertheless, as we have already demonstrated, the development of the Permanent War Economy stage of capitalism has altered Marx’s fundamental law of capitalist accumulation. To this extent, the doctrine of ever-increasing misery is in need of revision.

To this extent, the doctrine of ever-increasing misery is in need of revision. Marx, so far as we can determine, never stated that the standards of living of the employed working class would deteriorate. He expected that the weight of the lazarus-layers of the working class (the unemployed) would carry down the average standard of living of the entire working class. Only in this sense is it proper to speak of ever-increasing misery. And until the last decade, or until the development of the Permanent War Economy, it looked, as Strachey tacitly admits, that Marx was more or less correct. If, however, we are to admit that the average standard living of the employed working class is higher today than, let us say, it was two, three or four decades ago, we might try to include in this total evaluation, for surely it is part of total misery, the casualties of wartime, both in war and peace, and the psychological impact on want satisfactions on a world that lives under the constant threat of total annihilation. Moreover, as Strachey stresses, the major egalitarian trends that are truly significant occurred mainly during World War II. As we stated at the outset, if capitalism can progressively raise average standards of living, and at the same time maintain a relatively peaceful international equilibrium, then it is still a viable historical system. We then need neither Marx nor Strachey but it is suggested that before everyone joins the capitalist band-wagon, we wait another decade, or even less to see if capitalism has really solved the problems of economic and political stability and progress. The real significance of Strachey’s present volume is that he recognises that we have entered a new stage of capitalism, that capitalism no longer is self-regulating, that it is (and must in order to survive) be controlled. He gives Keynes great credit for recognizing that capitalism was no longer self-regulating. What he fails to see is that Keynes was the great bourgeois’ economist of the depression. His views on state intervention were acceptable only so long as the Great Depression prevailed. Once World War II and the ensuing Permanent War Economy developed, Keynes went into considerable decline, especially within American governmental circles. It is interesting to note that Merchant’s View column in The New York Times of August 11, 1957 poses the question: “Can the national economy be controlled? It would appear that Government officials are experimenting with this problem in ways, perhaps, that appear to be baffling to the average business man.” Apparently, even The New York Times is not aware of the fact that the economy has been controlled for the past decade and more. The nature of the controls, their success and their impact on capitalism are necessarily subject of a future article. Suffice it to say, that we are of the opinion that under the Permanent War Economy, the capitalist state must control the economy. How long-lasting and successful this type of state intervention will be is a separate question. The permanent peace-and-prosperity school ought to wait a few years before they declare the present precarious equilibrium to be permanent. After all, capitalist planning is not the same thing as socialist planning. Moreover, the capitalist world is in a curious dilemma with respect to the Stalinist sector of the world. Capitalism needs Stalinism to help maintain the existing international equilibrium and to provide a socially acceptable raison d’etre for the huge war outlays that alone provide the current decisive underpinnings of the entire economic system. Yet, the maintenance of Stalinism can lead to its strengthening, and the further whittling-away of the capitalist market, not to mention the ever-present danger that Stalinist political-military maneuvers will be successful and that, consequence, the physical dimensions of the capitalist world will be reduced still further. Strachey would like to believe that a marriage of Keynesianism and social democracy can solve the problems of the world. In any event, he rejects any concept of the Permanent War Economy. He states (p. 295 et sequitur): There is another and less palatable reason why it would be a great mistake to dismiss the Keynesian techniques as illusory. As we noted, those Marxians [Stalinists?] who are unable any longer to deny that capitalism in the nineteen-fifties is behaving very differently from what it did in the nineteen-thirties, explain that this is simply due to vast expenditures upon armaments ... The case of these – mainly communist – critics is, briefly, as follows: “No doubt it is true that if a capitalist government supplements the activities of its profit-seeking entrepreneurs by itself spending or investing sufficiently massive sums, it can sustain the economy at a level of full employment. But a capitalist government will be intensely unwilling to do this for peaceful purposes ... Such (military) government expenditure fits into the generally aggressive policies of capitalist governments of the latest stage. It is this kind of government expenditure and this kind alone which the capitalist governments have undertaken on a scale sufficient to be economically significant since 1945.” ... Such an explanation is a crude caricature of the complex realities of the contemporary situation ... The American economy had, it is true, suffered a very shallow depression in 1948–49 ... But the figures show incontrovertibly (they will be given in a later part of this study) that this depression was over and the progress of full employment had been resumed before the outbreak of the Korean war and long before the American rearmament program began. It is a pity that Strachey does not submit his figures on the American situation in the current volume, for the future of capitalism depends on the United States, not on Britain. This provides us with an opportunity, without any elaborate explanation, to present our latest figures on the relationship of war outlays to total output in the United States during the past ten years of the Permanent War Economy.

This provides us with an opportunity, without any elaborate explanation, to present our latest figures on the relationship of war outlays to total output in the United States during the past ten years of the Permanent War Economy. Direct and Indirect War Outlays, 1947–1956 and Their Relationship to Total Output (Dollar Figures in Billions) Net National Product WAR OUTLAYS Ratio of War Outlays to Total Production; Col. (4) as % of Col. (1) Direct Indirect Total Year (1) (2) (3) (4) (5) 1947 218.1 12.3 13.1 25.4 11.6 1948 240.8 11.6 12.9 24.5 10.2 1949 238.9 13.6 13.7 27.3 11.4 1950 264.6 14.3 11.7 26.0 9.8 1951 304.8 33.9 9.3 43.2 14.2 1952 321.6 46.4 8.0 54.4 16.9 1953 336.7 49.3 7.2 56.5 16.8 1954 331.9 41.2 6.9 48.1 14.5 1955 359.5 39.1 7.6 46.7 13.0 1956 378.4 40.4 7.6 48.0 12.7 Source: July 1957 Survey of Current Business for net national product and direct war outlays. Indirect war outlays calculated as explained in Part I of The Permanent War Economy (Jan.–Feb. 1951 issue of The New International and the March–April 1953 issue of The New International, pp. 94–95. While many of our prior actuals are herewith revised, the only important change is for the year 1947 where our present figures are considerably lower and the ratio of war outlays to total production is revised downwards from the previous 13.7% to the present 11.6%. It will be seen that in the year 1950, in the middle of which the Korean war broke out, the ratio declined below 10% to 9.8%. It should be remembered that at that point official unemployment statistics in the United States reached a total of 4,700,000. It was only the rapid increase in the ratio of war outlays to total production that prevented a serious unemployment situation from having far-reaching political effects; and, of course, it was the sharp rise in the war outlays ratio to a peak of almost 17% in 1952 and 1953 that reduced the level of unemployment to politically tolerable and relatively minor levels. The gradual reduction and leveling off in war outlays in the post-Korean period has brought about a decline in the ratio of war outlays to total production. Attrition begins to set in. The big bourgeoisie demand a halt to inflation, or rather they use the concern of the working classes to prevent inflation as a device for getting the government to raise interest rates to place a squeeze on small and medium-size business. The “battle the budget” has all kinds of political motivations and overtones, but it is already clear that to the extent the government succeeds in halting inflation, the ratio of war outlays will continue to inch downward and unemployment will continue to creep upwards. That the government is not entirely unaware of the economic implications of reductions in military outlays is graphically revealed by Marc Childs in his widely syndicated column of August 20, 1957, wherein he comments on “Jobs and Defense by stating, in part: “The aviation industry is beginning to feel the effects of cutbacks in competing missile programs and in military aircraft production. The resulting unemployment when it is put together with pockets of joblessness, has raised the fear in the administration that the rising spiral of prices may eventually and sooner rather than later – bring deflation. As a result, Sherman Adams, the assistant to the President, instructed Clarence Randall, White House adviser on trade and economic affairs, to review every government cutback that might adversely affect a plant having more than 5,000 employees. Randall is confident the economy can absorb this unemployment and continue at the present high level, but there are others not so optimistic”. (Italics mine – T.N.V.) We belong in the latter group, Strachey presumably would side with the optimists. In any case, it should already be clear (and, if not, it will become increasingly so) that contemporary capitalism, while a new stage (the Permanent War Economy), has achieved only the most precarious of equilibria, both domestically and internationally. The continual production of ever-increasing amounts of the means of consumption depends not only on constantly increasing production of the means of production, but on maintenance of the high level of production of the means of destruction. The impossibility of continuing to expand in all three departments of production will lead to a deteriorating economic situation and in the relatively near future to the beginnings of a first-rate political crisis. T.N. Vance August 1957 Footnotes 1. Contemporary Capitalism by John Strachey, 1956, published by Random House, Inc., 374 pp., $5.00. Top of page Vance Archive | Trotskyist Writers Index | ETOL Main Page Last updated: 15 January 2020

Vance Archive | Trotskyist Writers Index | ETOL Main Page Frank Demby Suppose They Limit Profits to 6%, What Does It Mean? (October 1941) From Labor Action, Vol. 5 No. 40, 6 October 1941, p. 3. Transcribed & marked up by Einde O’Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL). In response to the-growing dissatisfaction with the tremendous amount of profiteering that is taking place under the “defense” program, Secretary of the Treasury Henry Morgenthau, Jr., precipitated one of the bitterest economic controversies ever touched off by the Roosevelt Administration when he proposed that the .government take all profits over 6 per cent of the capital invested. The eminent Secretary was testifying in favor of price control as the only alternative to inflation. The bombshell was let loose in response to a question from a reporter about controlling the present rise in prices. Immediately a storm arose on Capitol Hill and in the boss press about the “radical” Morgenthau trying to “carry out the New Deal program for the establishment of socialism” and “the destruction of private initiative.” Both the proposal and the response are extremely interesting and deserve the careful attention of the workers. Morgenthau was very careful to dress his proposal up as an additional measure to prevent inflation. He did not dare to mention the super-colossal profiteering going on now in all branches of industry and business. But there is no doubt that the chief motivation for the 6 per cent profit limitation is the widespread feeling that there is something slightly unethical, to say the least, when the big corporations are raking in the dough so fast that they can’t count it. It strikes the masses of the population as something: less than 100 per cent patriotism when the bosses are making from 100 to 400 per cent profit in many cases – during a period officially proclaimed as a “national emergency.” This is bad for the morale of the people. It leaves the workers and the soldiers feeling very disgruntled. The common man begins to feel that he is holding the bag, so to speak, while the bosses empty it – which is as good a description of the present situation as any. Such a situation breeds strikes and unrest. Worst of all, it sharpens class antagonisms. The best way, from the point of view of the bosses, is to PRETEND to impose sacrifices on the bosses. We’re From Missouri We welcome the idea of a 100 per cent excess profits tax. This is an essential first step in the direction of elementary social justice. Yet I hope that our readers will forgive us if we introduce a slightly skeptical note. In the first place, “we’re from Missouri.” We don’t believe the bosses will tolerate a 6 per cent limit on their profits – even on paper. Already, it is indicated that the government will have to “compromise” if it wants to get any bill passed which limits profits. The nature of such a “compromise” measure is not hard to guess. It will still permit the bosses to coin fabulous profits. A meaningless gesture to appease the outraged sentiment of the workers is all that can be expected from a boss government, dominated by “dollar-a-year” men. If the bosses refused to produce during the first period of the “defense” program until the Vinson-Trammell Act, limiting profits on naval order to 8 per cent, was repealed; if they virtually went on a “sit-down” strike until they got a fake excess profits bill passed, coupled with a very liberal amortization clause that allows them to write off the cost of new plants in five years instead of the customary 20 years – there doesn’t seem to be any reason for believing that the big capitalists will sit idly by and watch the government reduce their profits to a “starvation” minimum. But, since the age of miracles has not yet passed and this war is a very serious business, let us suppose that the government gets a 6 per cent profit limitation bill passed. This brings us to the second reason for our skepticism. Profits can be concealed, with or without the connivance of the Treasury’s tax experts, so that what appears to be a 6 per cent profit away well turn out to be 60 or 100 per cent or more. The International Federation of Trade Unions, for example, reports that even in Germany, with a 6 per cent limit on profits, supposedly enforced by a powerful and ruthless government, the big capitalists are able to conceal fantastic profits under the legal 6 per cent clause. One of the favorite tricks is to “water the stock.” In this favorite dodge of the big bosses, the Americans don’t have anything to learn from the Germans. The aircraft companies, among many others, are excellent examples of this technique. Let us say that a corporation has raised $10,000,000 through issuing common stock. Six per cent on this capital invested would mean that the most that could be paid out in dividends is $600,000. Now let us suppose this stock is “watered.” That is, more stock is issued than the corporation is worth. What happens? Just this – if, for example, twice the amount of stock is issued (and it only requires a “vote” of the stockholders to authorize such a maneuver), then the corporation presumably has a capital of $20,000,000. Six per cent on this amount would mean double the profit, or $1,200,000. There is practically no limit to the extent to which this profit-concealing device can be used. And if they get tired of using this method of concealing profits, there are many others that the bosses can use and are using every day. One of the favorites is to pay out huge salaries and bonuses to the officers (for their hard work in concealing profits, of course). Such items become part of the costs of manufacturing, according to capitalist bookkeeping methods. They are, is reality, profits. What Shall We Do? There are many other methods that the bosses use to conceal their profits. Corporation lawyers are paid fancy salaries for precisely this reason and we are sure that with the incentive for concealing profits increased by a profit-limitation bill, the corporation lawyers will work overtime to find new methods to conceal profits. As long as the bosses control the economic set-up, any profit-limitation can only be a paper one. If the government is serious in its desire to control and limit profits, then let the workers examine the books of the bosses. Only the workers know the real situation in their own factories. Only the workers can make sure that the profits of the bosses are really limited. The workers, however, will never get this right from the bosses or from the boss government. They must fight for it, make it one of their demands on the picket line. This, and only this, is the way to limit profits. Top of page Vance Archive | Trotskyist Writers Index | ETOL Main Page Last updated: 28 February 2020

Vance Archive | Trotskyist Writers Index | ETOL Main Page T.N. Vance Features of U.S. Imperialism (May 1941) From The New International, Vol. 7 No. 4, May 1941, pp. 73–76. Written by T.N Vance under the name “Frank Demby” Transcribed & marked up by Damon Maxwell for the Encyclopaedia of Trotskyism On-Line (ETOL). Proofread by Einde O’Callaghan (December 2012). EVER SINCE THE UNITED STATES became a creditor nation in 1917, the specific weight of American imperialism in world affairs has steadily grown. The maturation of American capitalism during the decade of the 1920’s brought about significant structural developments within its anatomy. These developments have greatly influenced the growth of American imperialism and its influence on the course of world history. Nowhere is this more strikingly illustrated than in the present situation, which clearly centers around the war. It is with the hope of throwing some light on this key problem that this examination of the internal structure of the American bourgeoisie and its foreign investments is undertaken. The fact that the capitalist class in a particular country is far from homogeneous is certainly not a new discovery. It goes back at least as far as Marx and was clearly understood and amplified by Lenin in his study of modern finance capitalist imperialism. Nevertheless, there has been a tendency within the Marxian movement (and, it goes without saying, amongst the bourgeois economists and historians) to minimize and even to overlook the importance of the various groupings within the bourgeoisie (determined essentially by the form and location of their capital accumulations – such as finance, banking, industrial, commercial and agricultural) and to treat the various national bourgeoisies as more or less homogeneous wholes. In this fashion, half-truths are paraded as the last word in realistic analysis. The democratic bourgeoisies are interested in preserving their empires. The fascist bourgeoisies are interested in acquiring these empires. Everything becomes very simple – indeed, too simple. For, in spite of all the nationalistic propaganda that they and their agents have spewed forth, the modern (twentieth century) bourgeoisie is the most internationally-minded class that history has yet produced. It is necessary to begin first with a brief presentation of economic data concerning American foreign investments, for these exports of surplus capital are most important in establishing the framework within which American imperialism must operate during the coming period. “Prior to the present century American investments abroad were comparatively small. An estimate by Nathaniel T. Bacon placed American investments abroad in 1900 at $500,000,000 ... Charles F. Speare placed American investments abroad in 1909 at $2,020,000,000 and John B. Osborne estimated them at $1,902,500,000 for 1912.” (Moody’s 1940 Manual of Investments). Thus, even before World War I, American capitalism was casting about for a more profitable outlet for its surplus capital accumulations. The war of 1914–1918 greatly accelerated the process. In the decade from 1912–1922, American foreign investments increased 300 per cent. Moreover, in the course of this phenomenal increase, a profound change took place in the structure of American imperialism – a change which was a direct result of the war. From a debtor nation ever since its origin, the United States became in 1917 a creditor nation. Growth of American Investments During the period of the First World War most of the financial interests of American imperialism, consisting of financial loans, trade and investments, were in Europe, and most of these were in England. But in the course of the subsequent two decades, many changes have taken place in the foreign investment position of American capital. While different sources give different estimates of the amounts invested abroad, the most official figures available are those of the Department of Commerce. These show a steady rise until 1931, as follows (these figures are based on conditions existing on January 1 of the given year): Year Amount 1922 $8,020,000,000 1923 8,877,000,000 1924 9,135,000,000 1925 10,004,000,000 1926 10,876,000,000 1927 11,684,000,000 1928 12,656,000,000 1929 13,973,000,000 1930 14,764,000,000 1931 15,170,000,000 This decade, in other words, represents the heyday of American imperialism. Foreign investments increased almost 100 per cent and reached the huge absolute figure of more than 15 billion dollars (some estimates place it as high as 18 billions). Interest payments and dividends on these investments annually ran to more than a billion dollars, a substantial item in the international balance of payments. The American octopus had extended its tentacles over virtually the entire globe. In so doing, it had produced some important qualitative changes. Investments in Europe remained more or less the same.

Investments in Europe remained more or less the same. The big increase occurred in the Western Hemisphere. A survey made by Fortune in July 1931 gives the following figures for the year 1929-1930: Location Amount Europe $5,000,000,000 Western Hemisphere $9,350,000,000 (Latin America – $5,500,000,000) (Canada – $3,850,000,000) Far East $1,300,000,000 (Asia – $900,000,000) (Australia – $400,000,000) Africa $100,000,000 Total $15,750,000,000 Note well that investments in Latin America now exceeded those in Europe. Important as this change is, its full significance only becomes apparent during the decline of about $4,000,000,000 that took place in American foreign investments during the decade of the 1930’s. From the beginning of 1931, the decline is steady, most of it being recorded in the first six years of this decade. The Department of Commerce (July 1940) records a total foreign investment of American capital at the end of 1939 of $11,365,000,000. If one compares the proportionate amounts invested in different geographical areas in 1929 and in 1939, then the changes are quite striking: Area Percentage of total investment 1929 Percentage of total investment 1939 (Amount 1939) Europe 31 20 ($2,278,000,000) Western Hemisphere 59 70 ($7,915,000,000) Far East and Africa 10 10 ($1,172,000,000) The fact which emerges as predominant is that 70 per cent of America’s foreign investments are in the Western Hemisphere, as World War II confronts American imperialism with even more decisive questions than did World War I. Moreover, the decline in the absolute amount of capital invested in Europe (which is more than 50 per cent during the last decade) has undoubtedly been accelerated during the past year as the Nazis have attempted to put their grossraumwirtschaft into operation in Europe. Banking Capital Asserts Itself In the case of World War I, American investments were largely in Europe. In the case of World War II, American investments are overwhelmingly in the Western Hemisphere. World War I saw America emerge as the dominant imperialist power of the world; almost, but not quite, “master of the world,” as Mr. Thomas W. Lament of the House of Morgan had hoped. During the decade of the 1920’s, American imperialism put Europe on rations and extended its sway through-out the world, especially in the Western Hemisphere. The decade of the 1930’s saw American imperialism enter into the period of decline that has characterized world capitalism as a whole since 1914, and many readjustments were forced upon it both internally and externally. Not the least of these was the necessity of relinquishing the attempt to reduce Europe to the status of a colonial dependency of the United States. The Western Hemisphere was found to be a more profitable and safer field for exploitation than Europe. Here, in reality, lies the origin of Roosevelt’s “Good Neighbor” policy and the imperative necessity for the Act of Havana. The position of American imperialism vis-à-vis World War II is clearly not quite the same as was its relation to World War I. American capitalism entered the highest stage of its development – the imperialist stage – during the last years of the nineteenth century. Two events, among many, signalled the emergence of the brash youth from its precocious adolescence into the estate of manhood amongst the capitalist nations of the world. They were the Spanish-American War and the formation of the gigantic billion dollar monopoly, the United States Steel Corporation in 1901. The first event served notice on all competitors that American imperialism could not be ignored in any distribution or redistribution of the world’s markets, colonies or spheres of influence. The second event served to emphasize and to punctuate the importance of the first. When the canny Scot, Andrew Carnegie, sold his industrial properties to the successful banker, J.P. Morgan, the process of merging banking capital with industrial capital came to a climax and then continued on a grand scale. American imperialism throughout the twentieth century is thus characterized by the domination of finance capital. The fusion of banking capital with industrial capital to form finance capital does not disclose the same story in each case. On the contrary, two major trends can be noted in the United States. The more classic case is that of banking capital, through its role as promoter, invading the field of industry. Occasionally by outright purchase, but more often by various forms of intimidation and pressure, it secured control of various industries. The outstanding example of this method is, of course, the Morgan interests. The National Resources Committee in its study of The Structure of American Economy (1939) estimates that there are eight large interest groups. Of these, what is called the Morgan-First National group is by far the largest. Corporations directly controlled by this group possess assets of more than $30,000,000,000. The other major method by which finance capital evolves is best exemplified by the Rockefeller interest group. Capital is originally accumulated in the field of industry or mining (in this case, oil). It expands until the pressure of accumulated surplus reserves and the struggle for survival and domination force it to acquire control of banking capital. In 1930, for example, the Rockefellers bought into the Chase National Bank and, through the help of the Banking Act of 1933, established Mr.

Rockefeller’s son-in-law, Winthrop W. Aldrich, as chairman of the Board of Directors. The Board of Directors was pruned and reorganized with the object of forcing the Morgan men out. Today, the Chase National Bank, with total assets of three and one-half billion dollars, is the largest bank in the world and is clearly a Rockefeller-controlled institution. The total assets of the 50 largest banks in the country plus the 200 largest non-financial corporations are approximately $100,000,000,000, or almost one-half of the total national wealth. The eight finance capital groups, Morgan-First National, Rockefeller, Kuhn-Loeb, Mellon, Chicago, DuPont, Cleveland, and Boston, control 62 per cent of the assets of this list of the principal 250 corporations. In a very measurable sense, therefore, finance capital controls the United States. The Morgan-Rockefeller Groups Within these eight major interest groups, the two most important, especially from the point of view of their ability to influence domestic and foreign policy, are the Morgan and Rockefeller groups. The other six groups generally occupy a position subordinate to the two main groups. Moreover, the Morgan and Rockefeller groups were the first to appear on the historical scene as important molders of policy. To a large extent the history of the United States during the first part of its finance imperialist phase (1890–1917) is a history of the conflicts between these two groups. Following World War I, however, during the phenomenal expansion of American imperialism in the 1920’s, many changes took place within the anatomy of American imperialism. These left their mark on the Morgan and Rockefeller groups. The fairly sharply defined Morgan and Rockefeller groups have given way, as a result of a maze of interlocking directorates formed under relentless pressure by the requirements of monopolistic competition, to loose, informal groupings of “friendly enemies.” Both the Morgan and Rockefeller families have declined tremendously in importance. The dominant figures in both groups are chiefly successful business men who have demonstrated by their ability and success their right to positions of leadership within the American bourgeoisie. Changes are made as often as circumstances require within this leadership. That which gives these groups continuity is their more or less respectively similar interests plus the perpetuation of the Morgan name in close association with one group and the Rockefeller name with the other. The original antagonisms between the Morgan group and the Rockefeller group, based on the conflict between finance capital and industrial capital, have not been completely obliterated. They still remain latent and, on occasion, burst into the open. Both groups, today, are full-fledged finance capital groups. But, because of the nature of their origins, their investments are not identical. The Rockefeller group, wherever a conflict arises between industrial capital and finance capital, is inclined towards the industrial capital position. The Morgan group, however, even though its industrial interests are larger than its banking interests, is both in origin and outlook a banking group. Hence, whenever a conflict arises between industrial capital and finance capital, as more genuine finance capitalists, the Morgans incline towards the banker’s point of view. Labor policy, price policy, the New Deal and domestic politics, as well as foreign policy, have, on occasion, served as battlegrounds between the two groups. The Rockefellers and their allies have been much firmer in their insistence on an open shop policy than the Morgans. They have pursued a much more rigid, inflexible price policy than the latter. They have been openly anti-New Deal, whereas the Morgans have varied in their attitude, at times being quite friendly to the Roosevelt Administration. The Rockefellers have concentrated more and more on the Republican Party, while the Morgans have continued their interest in both political machines. Finally, the original appeasement sentiment in this country (after the outbreak of the war) was pretty much concentrated in the Rockefeller group. If one considers solely American direct investments abroad (this type of capital investment is the more stable and, other things being equal, will more likely influence policy than portfolio or short-term investments), the reason for the cleavage on foreign policy between the two major groups within the American capitalist class that ran from the outbreak of World War II until almost the date of the 1940 election appears to be quite clear. At the end of 1936 (whatever shifts have taken place since are relatively minor and can only serve to reinforce the general picture which I am presenting), 72 per cent of American direct investments were in the Western Hemisphere, 18 per cent were in Europe, and the remaining 10 per cent were largely in the Far East. Manufacturing, public utilities and transportation investments are chiefly Morgan. Petroleum, mining and smelting are chiefly Rockefeller. An analysis of the location of these different types of investments reveals that the bulk of the investments in Europe are Morgan-controlled; the bulk of the investments in the Far East are Rockefeller-controlled. Both groups have very important in-vestments in the Western Hemisphere. From what I have said above, the following conclusions seem to be indicated: The most successful policy that American imperialism can pursue is one that will secure the maximum agreement within the American bourgeoisie. So far as foreign investments are concerned, this means that the cornerstone of American policy must be the protection of the 70 per cent of American investments in the Western Hemisphere. For it is here that all groups of American imperialists have important interests. The alliance with Canada, the Act of Havana, the creation of the Pan-American Bank, the granting of a $500,000,000 capital to the Export-Import Bank for loans to Latin America, the military plans for Hemisphere “Defense,” these are virtually the only items in American foreign policy today that have the unanimous approval of all sections of the American bourgeoisie. While all American imperialists are interested in the Western Hemisphere, some are not particularly interested in Europe or the fate of England.

While all American imperialists are interested in the Western Hemisphere, some are not particularly interested in Europe or the fate of England. Others are. The House of Morgan, for example, is vitally interested in defending England. More is involved here than the simple fact that the Morgans have considerable investments in England. England (the City of London) has been the world center of international trade, the focal point from which finance capital throughout the world operates. If England goes under, not only do the Morgans lose considerably in wealth, power and prestige, but world finance imperialism will be considerably shaken. If it lies within the power of Morgan and those financial interests allied with him, history will repeat itself. America will enter World War II for the same laudable purpose as last time – to protect American trade with and investments in England. Some American imperialists are more worried about the threat offered by Japanese imperialism than that offered by German imperialism. They are not only the ones who have the chief stake in the Far East, but who, above all, see in the Far East a great potential sphere of interest. This vast market, embracing almost one-half of the world’s population, possesses unlimited opportunities for capital investment, securing raw materials, and for trade. It is in the Far East that the destiny of American imperialism lies, in their opinion. These difference within the ranks of American imperialists, plus the course of the war to date, have forced the Roosevelt Administration to operate on the basis of the least common denominator between the two major groupings of American imperialists – Hemisphere “Defense.” The immediate purpose of an army of 4,000,000 American conscripts is likely to be as an army of occupation throughout the strategic points of the Western Hemisphere. The aim of American imperialism in this war must be complete mastery of the world. Or, in the words of Wendell Willkie, a Morgan man if there ever was one in American politics: “After this war, the capital of the world will either be in Berlin or in Washington.” But there are still some differences of opinion within the bourgeoisie on how this program of world domination is to be accomplished. The War and Group Unity The continued resistance of England, which gives currency to the forecasts of a type of Napoleonic war, has strengthened the Morgan hand. Their task now is to involve the United States in the war in a military manner as quickly as feasible. To do this, they must, if possible, cement their agreements with the Rockefellers. The government, therefore, must increasingly represent, for the bourgeoisie, a regime of national unity. Roosevelt has already taken the first steps in this direction. His appointments of Stimson and Knox, two Republicans, to the key cabinet positions of War and Navy, were more than a clever election maneuver. It was the first step in the direction of a government of national unity. The personnel of the National “Defense” setup is steadily broadened out to embrace all sections of finance capital. Aside from Stettinius, with his Morgan link, and Knudsen, with his Morgan-DuPont link, one of the most significant of recent appointees has been that of Nelson Rockefeller to the position of Coordinator of Cultural Relations with Latin America. In general, the crisis of capitalism requires more and more constant intervention on the part of the capitalist state in the affairs of business. This is what Lenin called the domestic counterpart of modern finance imperialism – the development of state monopoly capitalism. An additional reason for the hastening of this process is that an immediate solution, in view of the war situation, for these internecine conflicts within the bourgeoisie is required – and only the capitalist state can solve them. Along with this growing unification of the capitalist class within the capitalist state will come the hammering out of a clearly defined policy of action for American imperialism, both in regard to domestic affairs and foreign policy. Its out-lines have already been clearly indicated by Roosevelt during the past year. Price policy is to be dictated by the capitalist state in the interests of the entire capitalist class – witness the establishment of a price ceiling in steel. Prices are no longer to be subject to the vagaries of the market, as influenced by the necessities of fratricidal warfare amongst the capitalists. Profits will not be ignored. Far from it. They will now be guaranteed by the capitalist state at a higher level than the capitalists could hope to maintain by themselves in “normal” times. Along with and as a result of this tendency small business will be completely wiped out. The American industrial structure will be streamlined along the lines of 100 per cent monopoly. Since time does not permit, those industrialists who insist on the patriotic necessity of crushing labor in order to improve the war effort, will be forced by the capitalist state to acquiesce in Roosevelt’s policy of an alliance with labor, modeled after the British setup – witness the establishment of the National Defense Mediation Board and the manner of settling the Bethlehem, Ford and Harvester strikes. Foreign policy is now well formulated – witness the passage of the Lease-Lend Bill and other more recent steps and the enthusiastic approval given to these measures by the outstanding spokesmen for both the Morgan and Rockefeller groups. German imperialism is the main threat and must be defeated at all costs. This will take care of Japan and, incidentally, in the process of “helping” England, British imperialism will become subservient to the greater interests of American imperialism. The tendency which was exhibited by industrial capital in France towards appeasement and towards conserving its direct investments by avoiding the defense of Paris cannot be expected here. Finance capital is too cosmopolitan, too broad in its outlook to take such a narrow view of its interests.

Finance capital is too cosmopolitan, too broad in its outlook to take such a narrow view of its interests. The paucity of investments in the Far East and Africa, as well as Europe, dictates to American imperialism a policy of attempting to achieve world domination. This policy is reinforced by the tremendous pressure being exerted by untold billions of surplus capital lying idle within the country, and by the constantly growing pressure of an expanding armaments economy – which more and more exhibits a tendency to become permanent. We will not enter a foreign war, says President Roosevelt, “except in case of attack.” But American imperialist interests have already been attacked by Germany and Japan. They will be more so in the near future. How soon, then, will it be before there is another Lusitania incident, before Roosevelt and the rest of the capitalist propagandists have the pretext or invent the pretext of “attack” by a foreign power and America is launched in actual military participation in World War II? FRANK DEMBY Top of page Vance Archive | Trotskyist Writers Index | ETOL Main Page Last updated: 25 October 2014

Vance Archive | Trotskyist Writers Index | ETOL Main Page Frank L. Demby Chautemps’ Rule Shaky Prices Rise (September 1937) From Socialist Appeal, Vol. 1 No. 6, 18 September, pp. 1 & 3. Transcribed & marked up by Einde O’Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL). In the economic sphere the French Peoples Front has above all tried to emulate Roosevelt’s New Deal. Given, however, the far weaker financial structure of France, all the contradictions of a declining capitalism are accentuated and little has been done, as compared with the United States, in the way of granting concessions to the working class. Moreover, such concessions as the workers have obtained – the 40-hour week, two weeks vacation with pay, etc. – are obviously the result of the direct class-struggle action of the workers; for, where the workers have not been well organized, the Matignon agreements (which settled the strikes of June, 1936) have been violated with impunity by the bosses. It was under the Blum government that compulsory arbitration was made the law of the land, that the first devaluation was decreed, that the “pause” in social reforms was proclaimed. Thus, already under a so-called “Socialist” government, the French bourgeoisie – badly frightened during June of last year – had been able to reorganize itself and start a smashing offensive which leaves the workers in many cases worse off than before the Matignon agreement, and which has as its objective the wiping out of all the gains made by the workers and the corruption and eventual dissolution of all their organizations. With the virtual abolition of trade union life due to the omnipotence of the CGT bureaucracy (chiefly Stalinist-controlled now) the workers have found it almost impossible to fight against the employers. But, as the rising cost of living pinches them more and moire, they react. This explains the number of recent strikes in a country where strikes are now illegal. The accumulated discontent of the workers is, indeed, ready to explode. Even the petty functionaries in the trade unions, as their standard of living declines, are ready for strike action. Naturally,, the official “Communist”, “Socialist” and CGT press speaks of “other methods besides strike action”, “we must respect the law”, “order”, “dignity”, but the anti-working class nature of every arbitration decision leaves the worker with very little confidence in such methods. In addition, the criminal policy of the leadership in most of the recent strikes is sinking deeply into the consciousness of the workers. One example will suffice: In the recent hotel, restaurant and cafe strike in Paris, where the spirit of the workers was excellent, not only did the trade union bureaucracy refuse to provide the strike any sort of national solidarity in the way of funds, etc., not only did the bureaucrats negotiate a shameful contract at the very height of the strike (providing for “the re-employment of not more than 10 per cent of the strike leaders”!), but. L’Humanité and Le Populaire (official organs of the C.P. and S.P.) also proclaimed it as a victory, thus adding insult to injury. Since the workers weren’t very convinced of it, the CP sent Thorez to speak to them and to assure them that they had won a tremendous victory, and it must be all right because the C.P. is in favor of the settlement! Capitalists Profit Big industry is showing an increase in profits of about 10 per cent and more over last year, and there is a duel between the Peoples Front press and the reactionary press as to whether Blum or Chautemps should receive the credit for increasing the profits of the capitalists! The explanation of the recovery (which is no more than a temporary stabilization of the crisis, as is readily seen from any sort of careful examination of French economy), however is not hard to find. None other than Vincent Auriol, the “Socialist” Minister of Finance in the Blum cabinet, gives away the entire game when, in. his speech at the Marseilles Congress of the SP (Le Populaire, July 12, 1937), he says: “Yesterday’s war, the preparation of national defense – the broken-down arms, the new arms – absorbs 72 per cent of the budget.” (My italics). What more sinister comment could there be on the nature of capitalist profits! What surer indication can there be of the imminence and catastrophic character of the next depression! The entire economic fabric depends for its very life on war preparations. The bourgeoisie refused to give decree powers to Blum. That Bonapartist weapon must be entrusted to one of their very own – and so, Blum was succeeded by, Chautemps, some parliamentary juggling took place. Bonnet emerged as the miracle man of the financial world. Another devaluation was put through, again lowering the standard of living of the French masses. Every effort is being made to repatriate French capital and attract foreign capital. Blum’s “pause” is not only extended, but 10 billions of francs are pared off the existing reforms in an effort to balance the budget. In little more than two months, the first Bonapartist Peoples Front government has shown the workers and masses very clearly what is in store for them. Prices Soar Prices are moving up with such astonishing rapidity that hardly one price sign is reliable. If one goes to buy cigarettes and leaves 2 fr., for that is what is marked on the box (of 10), “Pardon, monsieur, it is 2.25 fr. now.” Prices are rising so rapidly that it is almost impossible to estimate the extent of the rise. But it is clear that the whole burden of the rationalization of economy and the preparation for imperialist war is being placed on the workers. Recently, the price of metro (subway) tickets was raised 25 per cent, bus tickets 33 per cent. It is estimated that these price increases, together with increase in taxes and tariffs, which cover every conceivable commodity and service, will result in a 50 per cent rise in the cost of living for the French worker during the coming year. This increase in the price of necessities, in the basic cost of living, will find a very cold reception amongst the workers. That is why almost every political tendency, from extreme right to extreme left, is agreed that this fall and early winter will be very critical and is almost certain to witness another strike wave and the fall of the Chautemps cabinet. (In succeeding articles Comrade Demby, who has just returned from France, will deal with the political forces in the French crisis) Top of page Vance Archive | Trotskyist Writers Index | ETOL Main Page Last updated: 23 November 2014