In spite of the imminent world recession, many companies are managing to maintain and even increase their profits. Taxation is always in the news and it got special attention with most of the candidates for the Tory leadership and to become the new prime minister offering tax cuts galore.
The Socialist Party states that it does not matter to the working class whether taxes are high or low, or whether they are direct, like present day PAYE, or indirect, like the duties on alcohol and tobacco. Many greet this with astonishment and unbelief; how, they ask, could anyone be so blind as not to see that workers would be better off with lower taxes? At first glance the case they make seems self-evident. If the PAYE deduction from wages goes up or if taxes put prices up surely the workers are worse off? And if PAYE or prices go down surely workers are better off? We can at once concede that at the moment when PAYE goes up or the cost of living goes up the workers are that much worse off: but what we should be concerned with is the longer-term, continuing, situation. And the fact is that, subject to variations due to other, quite different causes, the wages and salaries of the working class as a whole become adjusted to changes in PAYE and changes in the cost of living.
What really matters to workers is their “take-home pay” after deduction of PAYE and Social Security contributions, and what it will buy. It is this purchasing power that continually adjusts itself; not automatically, but through the struggles of workers inside and outside the trade unions, struggles influenced by the varying levels of unemployment. Government “wage restraint” propaganda and policies also play a part.
When purchasing power is reduced by higher tax deductions or price rises, workers react by seeking higher wages. When there are tax deductions or prices fall the workers’ resistance to pressure from the employers weakens.
There is plenty of evidence from past experience to show how take-home pay has adjusted to tax changes, and to changes in the cost of living. So we are on the solid ground of experience in asserting that taxation is not a working class issue, not forgetting that this presupposes that the workers continue the struggle to maintain and increase wages as far as conditions allow.
For the politicians aspiring to represent the interests of capitalists the position is quite different. Having exploited the workers to the fullest extent, having got maximum output at the lowest wage they can induce workers to accept they have to pay, out of their profits, the cost of maintaining the State apparatus, the armed forces and so on. The burden of taxation falls on them. It follows that as a class they have very good cause to keep government expenditure as low as possible so that taxation can be correspondingly low. The workers have no such interest.
There are two conditions necessary for the establishment of socialism; the development of the productive forces to the point where they can provide an abundance, and acceptance by the world’s working class of the case for socialism. Technological and scientific progress has for some decades now ensured the attainment of the first condition. Under capitalism, these developments and inventions are not utilised for the good of mankind.
However, in a socialist society, the fruits of human ingenuity will be able to benefit everybody. Technological progress will mean social and individual advancement. The soul-destroying work has not turned the workers into robots— that is, unthinking machines which simply respond to instructions. Society is too complex to be operated by robots; instead it is living, feeling and thinking workers who run society. The very existence of the Socialist Party shows that socialism is by no means a non-existent drive in working class politics. It is no good looking to historical materialism to bring about progress towards socialism; it is people, not history, who will carry out the revolution. The second condition for the establishment of socialism means a world-wide majority of convinced socialists, and this is what socialist education aims at achieving.
The ideas of the Socialist Party are difficult to oppose: there are no solutions under capitalism. Socialism is the answer. Under the present-day system of society, where the tools of production are privately owned, a large majority, through their lack of ownership of these tools, are economically forced to seek employment. That means that these people are exploited and as such, never receive the full fruits of their labour. This causes much discontent and gives rise to a common feeling that work is nauseating and a “ necessary evil ” and therefore this sharp division between employment and play. To a Socialist, this is just another ugly feature of capitalism, which will remain till the machinery of wealth production is converted to common ownership. Then men and women will be released from their wage slavery, and work will become regarded in its correct perspective, that is, there will be joy in creation. Society will be producing wealth for use and not for sale and profit as it is today.
It is not people who require to be reformed, (unless one believes the Salvation Army.) It is the social system. Each reform is a patch on the system’s fabric — and not, as some people suppose, a nail in its coffin. That is why the thousands of large and small reforms cannot really change things very much—they leave the system unimpaired and even refurbished a little. Benevolence is one thing, the abolition of poverty another. The best of social reforms does not, and cannot, overturn the factor that gives some people low wages and others high profits, any more than it is able to control or predict economic crises.
Real improvement in living means creating the right conditions—and before that, doing away with the wrong ones. The Socialist Party’s unvarying answer to reformers sounds unpalatable and even hard-hearted, but it is true. Either capitalism is abolished or it remains; and while it remains, the perennial difficulties of working-class life will be there too. Capitalism sets the limits and reformism, the product of that system cannot break outside it. Only by social revolution can the working class escape from the ills which they seek palliatives.
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