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The State is No Saviour

The state as Engels described it, is “the ideal personification of the total national capital.” (Socialism: Utopian and Scientific) and he recognised “The more productive forces it (the state) takes ever into its possession, the more it becomes a real aggregate capitalist, the more citizens it exploits. The workers remain wage-workers, proletarians. The capitalist relationship is not abolished, rather it is pushed to the limit. (Engels, Socialism: Utopian and Scientific)

 The nature of capitalism is distorted by those who draw their model of capitalism from its early competitive stage and describe its essence as the competition among individual capitals within a nation-state. Marx himself did not confine his analysis to a description of the stage of competitive capitalism, but grasped the basic laws of development leading to greater concentration and centralization of capital. Even in speaking of stock companies, he refers to this form of ownership as being “social capital” which rep…

State-owned Exploitation

Following on from the previous blog-post on co-operatives, the other panacea often presented is state-capitalism, sometimes described by the oxymoron term state-socialism.

Public ownership by the State is not socialism – it is only State capitalism. What many on the Left will do is add a caveat - that nationalisation with workers control is socialism. That too is erroneous. It still means state capitalism. Socialism is not state ownership or management of industry, but the opposite. Socialism abolishes the state.Industry is not transformed into the state, but industry is transformed into common ownership,  functioning industrially and socially through new administrative associations  of the producers, and not through the state. Socialists reject the idea that State capitalism is a phase of socialism. State capitalism can never become socialism  precisely because there exists  a state. A bait is offered to the workers of a “democratized” State capitalism by “democratizing” the governm…

The Danger of State Capitalism

In an earlier post we discussed nationalisation, it is worth going into such an economy where the state is the main owner.

Socialists envisage a society in which there will be no classes and no state. Many on the Left, including Lenin, have regarded state capitalism as a stage on the way to socialism. They view it as a necessary transitional stage. But history has the grave dangers of state capitalism.

State capitalism concentrates an overwhelming power in the hands of the State, and places workers completely at the mercy of the State. The State is not in the hands of the working-class but an all-mighty bureaucracy.

Under private capitalism in a democratic State the government has no substantial direct income. It raises revenue and makes expenditure by the authorisation of Parliament. This gives to Parliament a degree of control over the executive.

Under state capitalism, the government derives its income automatically from the economic enterprises of the State. It thus has a tende…

What Is Socialism? It is not nationalisation

“It was our lifelong dream coming true. It was a utopia. We were for it 100 per cent. What celebrations there were! The industry which had broken generations of miners was ours at last.”

On the 1st January 1947 miners took an unofficial holiday. The red flag was hoisted over the pits and the miners social clubs rang to choruses of the workers’ anthems of the Red Flag and the Internationale. The euphoria did not last.

Nationalisation (or in some cases municipalisation), is sometimes called “state socialism”, but more accurately it amounts to a form of state capitalism. The Post Office, would serve as an example of a “socialist” public service or the National Health Service. Or the BBC. But in the past we have had coal mines, the railways, the electricity and gas networks and tele-communications all owned by the state. Nationalisation has been wrongly equated with socialism. State ownership does not mean socialism. Nationalisation is a complete distortion of the idea of common ownership…

bank nationalisation (2)

It appears that some still see a future in the banks to solve the problems of the recession - state-owned banks, of course. Alf Young of the Scotsman appears to be a a convert and waxes lyrically about the Bank of North Dakota which is owned by the state. He appears to infer that the low impact of the crisis on the state had something to do with the this bank. Young then nostalgically recalled the widespread trustee savings bank that once existed but fails to mention that at least one still remains.

It is a shame that he never read the Socialist Courier or he would have come across this post which would have enlightened him a bit more to dead-end hope of bank nationalisation. 

Bank Nationalisation

It is no co-incidence that the cries for banking reform invariably comes during economic depressions. The lubrication that keeps the capitalist machine running – the money markets – are dysfunctional.

As Marx identified “So long as things go well, competition effects an operating fraternity of the capitalist class…so that each shares in the common loot in proportion to the size of his respective investment. But as soon as it is no longer a question of sharing profits, but of sharing losses, everyone tries to reduce his own share to a minimum and to shove it off upon another. The class, as such, must inevitably lose. How much the individual capitalist must bear of the loss, ie, to what extent he must share in it at all, is decided by strength and cunning, and competition then becomes a fight among hostile brothers. The antagonism between each individual capitalist’s interests and those of the capitalist class as a whole, then comes to the surface…”

 Marx also pointed out that “the mone…