Socialism is the system of society in which production is for use; that is, the production of all the means of existence, including all the necessities and comforts of life carried out by the community for its own use collectively and individually. Production to-day is purely in the interest and for the profit of the class which owns the instruments of production — by which we mean the land, the mines, the factories and machinery, transport, machinery. Socialism would substitute common ownership of these things and this would also involve the abolition of classes altogether.
The word class is used in many ways. For instance, we the the upper, lower and the middle classes. But this does not alter the fact that society is separated into two main divisions or classes, one part, for all practical purposes, possesses all the material means of production, and another section which has no effective ownership in, or control over, these things. The question as to which of these two divisions a man belongs to may easily be determined by whether he or she possesses or does not possess effective control over the labour of others through the possession or the control of the means of production.
The terms CAPITAL, CAPITALIST, and CAPITALISM, as generally used, imply considerable concentrations of the means of production in the hands of one person or a comparatively small number of persons, and the payment of wages for the labour employed in the use of these means of production, in such wise that the total product remains the property of the possessors of the capital used. Thus capital and capitalism imply the existence of a whole series of social conditions in which the users of the tools, the means of production, have no ownership or control over the tools which they use. The terms of the bargain between capitalists and non-capitalists are, therefore, the following: We are the proprietors of the whole produce of our property, our tools, and we agree to pay a small proportion out of this product to you, the actual producers.
Profit is not made on the market, but in the workshop, in the mine and the factory. Profit is derived from the surplus value which is wrung from the unpaid labour of the workers. Surplus-value is the difference between the cost of labour-power to the capitalist and the amount of labour-power he is able to extract from his work-force. Labour-power is the capacity for labour inherent in the workman, and it is this capacity or quality which the capitalist buys in the labour market as a commodity. We are assuming a modern capitalist society in which there are no slaves, and the workmen are free. Consequently the capitalist does not buy the workman, neither does he buy labour; that is to say, labour actually expended or in operation. What he buys, when he engages a workman for a given time, is the power to labour contained in the body of the labourer.
The labourer and the capitalist meet on the market, the one as seller the other as buyer, in the same way as do the buyers and sellers of other commodities. The exchange-value of labour-power is precisely the same as that of any other commodity, determined by the amount of socially necessary human labour expended in its production; in other words, and in the language usually employed by economists, the return to labour — WAGES — is determined by the cost of subsistence of the labourer. For it is by this subsistence that the labour- power is continually reproduced. The capitalist buys labour-power at its cost of production in labour, but the amount of labour which the workman expends, that is to say, the capacity for labour, or the labour-power, which the capitalist buys, and which the workman incorporates in the commodities he produces, is a very much greater quantity than is expended in the production of that labour-power, and it is this difference, a difference which the capitalist gets for nothing, which constitutes surplus-value.
The capitalist obtains this surplus-value owing to his monopoly of the means of production, which enables him to extend the working day, beyond the hours necessary to produce the subsistence of the labourer; by the employment of machinery, by which the labour of the workman is made more effective; and by the organisation of labour, which has the effect of intensifying the expenditure of labour. The labourer cannot, as a rule, command more than the actual exchange-value of his commodity, that is to say, his cost of subsistence, in return for his labour-although his wages, like the prices of all commodities, sometimes rise above this and sometimes fall below — because, although apparently free, he is really not free. He must sell his labour-power in order to live; he has no other commodity to dispose of, and, having no ownership in or control over the means of production, he cannot employ himself. Consequently, he has to find a purchaser for his commodity and must accept the terms that purchaser will offer — subject only to two conditions, his own cost of subsistence and the fluctuations of the market. The variations or modifications in its operation no more destroy its validity as a general economic law, than the fact that no bodies ever proceed in a direct line, owing to disturbances due to friction, disproves the first law of motion, or the law of gravitation. Machinery itself is the product of labour, and is used for the purpose of exploiting labour; but of itself it creates no value. The sum total of the value of a commodity represents the sum total of the average labour employed in its production, including that involved in producing the raw material and the amount of the wear and tear of the machinery used up in the commodity, but the surplus-value comes from unpaid labour only.
Machinery itself is the product of labour, and is used for the purpose of exploiting labour; but of itself it creates no value. The sum total of the value of a commodity represents the sum total of the average labour employed in its production, including that involved in producing the raw material and the amount of the wear and tear of the machinery used up in the commodity, but the surplus-value comes from unpaid labour only.
The profit of the immediate capitalist employer only forms a portion of the total surplus-value. Out of that total the landlord draws his rent, the banker his interest, government taxation to pay the salaries of public officers. In short the rewards or payments of all those who are not themselves engaged in the immediate work of production are all derived from the surplus-value wrung from the unpaid labour of the workers. Socialists do not accept the theory of the division of profit, as stated by the orthodox political economy, into wages of superintendence, rewards for risk-taking and abstainence. Although a portion of profit is spoken of as Wages of Superintendence, it is clear that in so far as such wages are strictly a return for the useful work of management, they are not profit at all, and it is only by a misuse of terms that profit can be so described. The term wages of superintendence, however, is generally only a fancy phrase applied by the capitalist to a portion of his profits, and bears no relation whatever to wages in any shape, or to any useful service which the capitalist may perform. As to indemnification for risk, the capitalist might so describe a portion of his profit, but as a matter of fact this is purely speculative, as there is no relation between his profit and his risk; while the less said about the abstinence for which he claims to be rewarded the better. The capitalist does not perform a useful function in running a risk for the profit he receives. In so far as he exercises the function of management and receives remuneration for this, his remuneration is not profit at all, but wages of superintendence, and the functions of management would be undertaken by the organised society of the future through its appointed representatives. As to any necessary risk, all individuals would be relieved from this under socialism, as it would be borne by the whole of society.
Socialism does not mean mere government or municipal ownership or management. The State of to-day, nationally or locally, is only the agent of the possessing class. State-owned businesses are run for profit just as other businesses are; and the government, as the agent of the possessing class, has, in the interests of its employers, to treat the employees just as other employees are treated. The organised democratic society contemplated by socialists is a very different thing. When society is organised for the control of its own business, and has acquired the possession of its own means of production, it will for the use of all and not for the profit of a few.
The Socialist Party of Great Britain seeks political power over the present class State for its conscious and definite aim the common ownership and control of the whole of the world’s industry. The entire means of production thus being common property, there would no longer be a propertied class to make a profit out of interest on loans or in any other way, and the property qualification which now divides society into two classes being thus swept away, classes themselves would disappear. Socialism is much more than an economic theory and embraces all the relations of human life. The establishment of socialism means a complete change in society in all its aspects. The economic conditions directly determine the political conditions; less directly, but none the less certainly, the ethical conditions; still less directly, the artistic.
To suppose that any mere distributive readjustment is what is meant by socialism is to entirely misunderstand what socialism really involves. Socialism means the complete reorganisation of production as well as distribution. With production scientifically and socially organised, the productivity of labour would be quintupled, and the amount of wealth would be increased in proportion. This increase in productivity will result, firstly, by the saving of the tremendous waste of labour which goes on to-day. All the labour employed in sales, advertising and exchange is entirely uuproductive, so far as useful wealth is concerned, and would be quite unnecessary if wealth were produced for use. Then there is the waste of labour involved in the use of obsolete methods, and in the employment of men and women to do work which could be more expeditiously performed by machines, simply because more profit is made by employing the men and women, owing to their labour being cheaper than machinery. And further, there is the inevitable waste of wealth under present circumstances due entirely to the system of production for profit, which makes it often more profitable to destroy wealth or to limit its quantity, rather than, to preserve or increase it. All this would be changed, and the vast mass of labour now wasted would be transferred to useful production, were society organised on a socialist basis.
With society properly organised there would be, with the unrestricted enjoyment of wealth, very much less waste — in both labour and material — in consumption. That is to say, the consumption or enjoyment of wealth would be more organised, more social, and less individualistic than it is to-day and would be infinitely less wasteful than now. Transport would be more economical when socialised than to-day, where the individual has to have his or her own car. Here it must be distinctly understood that we are not dogmatising as to what will be, but simply suggesting what may be done, in at least one way, to economise consumption by a proper organisation.
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