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Boris Johnson Is Not the New, British FD Roosevelt

It’s the first of July, the beginning of a new month, and a new set of lies, falsehoods, spin and propaganda from our clownish and murderous government. Yesterday, BoJob announced he was going to spend his way out of the recession caused by the Coronavirus lockdown. £5 billion would be spent on public services. Michael Gove hailed this as a ‘New Deal’, like F.D. Roosevelt’s for ’30s America.

No. No, it isn’t. Mike and Zelo Street have both published articles tearing great, bloody holes in this latest piece of monstrous spin. Zelo Street’s concentrates on the failings of Roosevelt’s original New Deal. Apparently it didn’t really begin to pay off until Roosevelt’s second term, because the great president was himself too committed to the economic orthodoxy of the time. This was to reduce government spending during a recession. Mike’s article, from what I’ve seen of it, dismantles Johnson’s promises. How much can we really trust them? Remember those forty hospitals Johnson told us the Tories were going to build. They weren’t, and aren’t. It was more lies and the number that were actually going to built was much, much lower. I think about six. The rest were going to be additions to existing hospitals, that had already been planned. And the numbers that were going to be built were far lower than those which were to be closed, either wholly or partially.

Everything says that this latest announcement of Johnson’s is exactly the same. More lies, and more promises that are going to be quietly broken later on.

And then there’s the matter of the amount Boris has said he intends to spend. £5 billion is an enormous amount, but Johnson has proudly boasted of spending such sums before. Like when he announced he was going to splurge out on renovating the country’s rail network. Zelo Street then put up an analysis of the figures and how much actually building new stations would actually cost, and the amount fell far, far short of what Johnson was actually claiming. I suspect that the £5 billion Johnson is now trying to get us all to believe he intends to spend is similar. It’s an impressive amount, but in reality much, much less than what’s actually needed.

And you can also bet it’s going to be lower than what our former partners in the EU are spending to get their economies started again. Recently, Private Eye published a piece attacking the Tories’ previous claim that leaving the EU would allow us to spend more on our economy. They compared what our government was spending with what France, Germany and some others were. They’re actually spending more than we are, which also demolishes the Tories’ claim that it was EU legislation that was preventing the government from spending more on the economy. No surprise there. The Tories have consistently lied about the European Union being the source of the country’s ills when the reverse has been true, and they themselves are responsible for the disastrous policies that have decimated our country and its people.

And when a right-wing British politico starts shouting about a ‘New Deal’, it’s always bad news.

Tony Blair similarly announced his new deal to tackle unemployment at the beginning of his government. He was going to introduce new reforms to encourage firms to take on workers. In fact, this was the wretched ‘welfare to work’ or ‘workfare’ policy, in which the unemployed would be sent to work for corporate giants like the supermarkets in return for the Jobseeker’s Allowance. If they didn’t go, no unemployment relief. As was documented by Private Eye, inter alia, the scheme does not help anyone get jobs. In fact, in the case of a geography graduate it actually stopped her getting the job she wanted. She was looking for work in a museum and had something in that line arranged as voluntary work. But the DWP insisted she work stacking shelves for Tesco or Sainsbury’s or whoever instead. It’s actually been found that if you’re unemployed, you are far more likely to get a job through your own efforts rather than through workfare.

And there’s another huge difference between the Tories and F.D. Roosevelt:

Roosevelt laid the foundations of an American welfare state. The Tories are destroying ours.

Roosevelt introduced some basic welfare reforms, like state unemployment relief. It wasn’t extensive, but it was something. The Republicans in America and the Tories over here hate the welfare state with a passion. It’s supposed to be subsidizing idleness and responsible for cross-generational pockets in which whole communities haven’t worked. The libertarianism which entered the American Republican party with the victory of Ronald Reagan was at heart concerned with reversing Roosevelt’s welfare reforms. Although it’s very carefully obscured now, it’s why the Libertarian’s magazine, Reason, in the mid-70s devoted an entire issue to denying the Holocaust. This featured articles by genuine neo-Nazis. This was vile in itself, but it was motivated by an underlying desire to undo Roosevelt’s legacy. FDR had been the president, who took America into the Second World War. This is seen as a good war, because of Nazis’ horrific genocide of the Jewish people, as well as others, though they rarely get a mention these days. If the Libertarians and their Nazi allies could prove that the Holocaust didn’t happen, it would discredit America’s entry into the War and make further attacks on Roosevelt and the New Deal plausible.

One of the reasons why he introduced unemployment benefit, such as it was, was because if you give money to workers during a recession, their spending will stimulate the economy.

But the Tories hate the idea of unemployment benefit and the workers actually having any money. They are the party of low wages, conditionality and benefit sanctions. Thatcher viewed the Victorians’ attitude that conditions should be made as hard as possible for the poor to encourage them not to rely on state assistance and agree to take work no matter how poor the wages and conditions as a ‘virtue’. It was one of her wretched ‘Victorian values’. During her reign, you couldn’t get away from her and the rest of her scummy party prating on about rolling back the frontiers of the state and the need to abolish the welfare state. The rhetoric has since quietened down and been modified, so that instead of abolishing the welfare state they talk about reforming it to target those who are genuinely in need. But the ideology hasn’t changed.

As a result, the British welfare state is in tatters. One organisation dealing with poverty and hunger in this country has stated that they’ve torn such great holes in it that it no longer functions. You can see this by the way unemployment has shot up so that one in four people is now claiming Universal Credit.

This isn’t just due to the Coronavirus. It’s due to the forty-year long Tory assault on the welfare state.

Johnson isn’t the new FDR. He’s the exact opposite – the destroyer of unemployment benefit and killer of those who need it.

See: https://zelo-street.blogspot.com/2020/06/bozo-is-not-franklin-roosevelt.html

New deal? No deal! We can’t accept a plan for the future from the failed PM who deliberately wrecked it

Dominic Cummings Wants to Take Housing Out of the Hands of Local Authorities

Published by Anonymous (not verified) on Mon, 29/06/2020 - 4:03am in

I was at a Zoom meeting Friday evening of my local constituency Labour party, Bristol South. The evening was devoted to a discussion of how the party should respond and formulate proper policies following the Keir Starmer’s national policy review. The areas under discussion that evening were housing and local democracy, and health and social care after the Coronavirus. Many members that the way to restore proper health and social care would be to give power back to the trade unions, and proper wages and career prospects to the women and men working in our NHS and care sector.

Local democracy is rather more complicated, however. As has been shown by the news over the last couple of days, many local authorities are now in dire financial straits thanks to the Coronavirus pandemic. The Tories did promise that they’d give them all the funding they needed to cope, but it’s been a typical Tory promise: the funding hasn’t materialised. The result is that a number of local authorities are facing bankruptcy. Wiltshire in the West Country is one, and Bristol may well be another. Bristol has fared better than most, as the much-maligned elected mayor, Marvin, did manage to sort out the financial mess and serious budget deficits left by the previous elected mayor, George Ferguson. It seems under Red Trousers there was serious financial mismanagement. This really doesn’t surprise me, as Ferguson announced one year there would be tens of millions of cuts, but that we shouldn’t be afraid of them. Before he became an independent, Ferguson was a Lib Dem, but he may as well have been a Tory.

It’s unclear what the proper spheres of national and local government are. Andrew Marr has published a book on this very issue, but I stopped reading it and put it away due to the flagrant anti-Labour bias on his TV show. I guess I’ll have to dig it out and start reading it properly, as this could become a major issue in the next few years. It is a major problem how we can get the British public involved in both national and local government, so that they don’t feel ignored and marginalized by the authorities.

And there’s a serious problem for local authorities on the horizon. Apparently Dominic Cummings wants to take housing out of the hands of local authorities. This is extremely alarming, given the closeness between the Tories and developers, as shown by Jenrick’s scandalous conduct over at Tower Hamlets. As Mike and the others have revealed on their blogs, Jenrick allowed Tory donor Richard ‘Dirty’ Desmond to develop Westferry in London against existing planning regulations or the wishes of the local authority after Dirty Des gave the Conservatives a £12,000 bung. After twelve years of power, we’re back to John Major and New Labour levels of sleaze and corruption again. It’s feared that if the Tories do take it housing into national government, they’ll just let off a free-for-all of development.

The Labour party in Bristol is trying to encouraging the renovation of older properties as well as the construction of new housing. Not only does this also provide accommodation, but it also employs more people. There are also problems with the current planning legislation in that developers can convert old commercial properties into residential housing in areas around music venues. This has been done in the old office blocks surrounding the Bristol pub, the Fleece and Firkin, which has been a centre for live musical performances in Bristol since the 1980s. The problem is that at the moment the developers don’t have to do anything to protect the homes’ prospective residents from the noise, so that they complain instead about the music venue. The local authority in Bristol is trying to bring in some of the continental legislation that protects existing music venues by insisting that the developers must install double glazing and so on when they build flats and homes in such areas.

The party on Friday was expecting the Tories to make the announcement they were taking housing away from local authorities today, but wondered if they actually would after the scandal with Jenrick. I haven’t heard that they have. But it’s clearly something they would dearly love to do. If that happens it will lead to housing and building development that isn’t wanted by the existing residents of an area, and the further destruction of local democracy.

This is an area which needs to be very closely watched and guarded.

Score! Football Marcus Rashford Gets Government to Provide Free School Meals During Holidays

Published by Anonymous (not verified) on Sat, 20/06/2020 - 5:50am in

Kudos and respect to Marcus Rashford, the Manchester United and England footballer, for managing to get Boris Johnson to supply free school meals during the summer holidays. Rashford had written an open letter to our comedy Prime Minister urging him not to end the current scheme of supplying vouchers for school meals to families, who otherwise could not afford to feed them at lunch time. Rashford was interviewed on BBC news, where he remembered having used food banks and free school meals when he was a child. He also raised £20 million to help poor families avoid starvation and other problems with the charity FareShare.

Johnson, as your typical Tory, initially refused. He said instead that he was going to make £63 million available to local authorities to help the poor obtain food and other necessities. But this is only a fraction of the £115 million that would be spent on free school dinners. Robert Halfon, a senior Tory, also broke ranks to argue that, under Johnson’s scheme, the money would never reach those who needed it because it was too bureaucratic. Johnson also tried palming Rashford and his supporters off with another scheme, in which the government would spend £9 million on holiday activities and feeding 50,000 needy sprogs. This is 1.67 per cent of the three million or so children going hungry thanks to the government’s wages freeze and destruction of the welfare state.

Mike one of his articles about this has put up a number of Tweets from people decrying Johnson’s miserly, spiteful attempts to stop children continuing to receive school meals. One of them is from Damo, who pointed out that the government can find £150 billion to help out big business, but can’t find £115 million for hungry children.

Ghoul Johnson spits on footballer’s school meals plea – he wants millions of children to STARVE

Finally, after realizing just what a public relations disaster this was, Johnson gave in. Rashford duly Tweeted his appreciation of the support he had received from the British public. But as Mike reminds us, Johnson only finally conceded to grant the meal because the campaign was led by a celebrity. Mike concluded

England in 2020 is a place where the government deliberately tries to harm its citizens…

… and where it only gives anything back in fear of harmful publicity from a campaign by a highly-visible public figure. If Joe Bloggs from a small village had run this campaign, your children would be skin and bone by September.

See: https://voxpoliticalonline.com/2020/06/16/tories-cave-in-to-rashfords-school-meals-campaign-with-scheme-for-holidays/

And where was Starmer during all this? 

As far as I am aware, Starmer said and did precious little. I think he might have made some approving, supportive comment after Rashford won his victory, but that’s it. And it’s not good enough from the head of the Labour Party.

But what do you expect? Starmer’s a Blairite, and Tony Blair’s entire strategy was to take over Tory policies in an attempt to appeal to their voters, while assuring them and the Tory media that he could do it better than they could. Meanwhile the British working class was expected to continue to support him out of traditional tribal loyalty and the fact that they had nowhere else to go. This resulted in Labour losing many of its members, to the point where even though he lost the elections, Corbyn had far more people voting for him than Blair did.

The result is that Starmer is dragging us back to the situation of the late 90s and first years of this century, when a genuine left-wing opposition fighting for working people and traditional Labour issues, was left to organisations outside the political parties. Organisations like Disabled People Against Cuts, who fight for proper welfare support for the disabled, anti-austerity groups and campaigns to save the NHS from privatisation. They’re doing what Starmer should be doing and conspicuously isn’t, afraid he might offend all those Tory voters he wants to support him. As against a real Labour leader like Jeremy Corbyn.

Marcus Rashford deserves full plaudits for his work to get deprived kids proper meals.

And Johnson and Starmer, for their initial lack of support for the scheme, are nothing but a disgrace.

 

Fabian Blueprint for a Socialist Britain

Sidney and Beatrice Webb, with an introduction by Samuel H. Beer, A Constitution for the Socialist Commonwealth of Great Britain (Cambridge: London School of Economics/ Cambridge University Press 1975).

I got this through the post yesterday, having ordered it a month or so ago. The Webbs were two of the founding members of the Fabian Society, the others including George Bernard Shaw and H.G. Wells. The idea of the NHS goes back to their minority report on the nation’s health published in the years before or round about the First World War. First published in 1920, this is their proposal for a socialist Britain.

The blurb for it on the front flap runs

The Constitution for a Socialist Commonwealth is a book that helps us understand the ‘mind of the Webbs’. Of all their works, it is the most general in scope – Beatrice called it a ‘summing up’ – and it does much to reveal the ideology of the great partnership. And since the mind of the Webbs was also the mind (though not the heart) of British socialism, an appreciation of this ideology, considered not only with regard to its confusions and blinds spots, but also its insights and intellectual sensitivities, helps one understand the Labour Party and what is still sometimes called ‘the Movement’.

But the book also has a broader importance. The problems that prompted the Webbs to write it still plague Great Britain and other, advanced societies. In 1920, the year of its publication, the modern democratic state was being sharply confronted by a syndicalist challenge based on the rising economic power of organised producers’ groups. Hardly less serious were the political difficulties of giving substance to parliamentary and popular control int eh face of growing bureaucratisation and a mass electorate. With regard to both sorts of problems, the Webbs were often prescient in their perceptions and sensible in their proposals. They concentrate on economic and political problems that are still only imperfectly understood by students of society and have by no means been mastered by the institutions of the welfare state and managed economy.

After Beer’s introduction, the book has the following chapters, which deal with the topics below.

Introduction

The Dictatorship of the Capitalist – The Manifold Character of Democracy.

The book is split into two sections. Part 1, ‘A Survey of the Ground’, contains

Chapter 1 – Democracies of Consumers

Voluntary Democracies of Consumers – Obligatory Associations of Consumers – The Relative Advantages of Voluntary and Obligatory Associations of Consumers – The Economic and Social Functions of Associations of Consumers.

Chapter 2 – Democracies of Producers

The Trade Union Movement – Professional Associations of Brain Workers – The Relative Advantages and Disadvantages of Obligatory and Voluntary Associations of Producers – The Economic and Social Functions of Associations of Producers: (i) Trade Unions; (ii) Professional Associations.

Chapter 3 – Political Democracy

The Structure of British Political Democracy: (a) the King; (b) the House of Lords; (c) the House of Commons and the Cabinet – Cabinet Dictatorship – Hypertrophy – A Vicious Mixture of Functions – the Task of the M.P. – the Failure of the Elector – The Warping of Political Democracy by a Capitalist Environment – Political Parties – The Labour Party – The Success of Political Democracy in general, and of British democracy in particular – The Need for Constitutional Reform.

Part II, ‘The Cooperative Commonwealth of Tomorrow’, begins with another introduction, and then the following chapters.

1 – The National Government

The King – the House of Lords – The National Parliament – the Political Parliament and its Executive – the Social Parliament and its Executive – the Relation between the Political and the Social Parliaments – Devolution as an Alternative Scheme of Reform – The Argument summarised – the Political Complex – The Social Complex – The Protection of the Individual against the Government.

2 – Some Leading Considerations in the Socialisation of Industries and Services

Three Separate Aspects of Economic Man – The Relative Functions of Democracies of Consumers and Democracies of Producers – Democracies of Citizen-Consumers – Democracies of Producers – ownership and Direction – The Participation in Management by the Producers.

3 – The Nationalised Industries and Services

The Abandonment of Ministerial Responsibility – The Differentiation of Control from Administration – The Administrative Machine – District Councils – Works Committees – the Recruitment of the Staff – Discipline Boards – Collective Bargaining – Advisory Committees – The Sphere of the Social Parliament – How the Administration will work – Initiative and Publicity – The Transformation of Authority – Coordinated instead of Chaotic Complexity – The Price of Liberty.

4 – The Reorganisation of Local Government

The Decay of Civic Patriotism – The Chaos in the Constitution and Powers of existing Local Authorities – Areas – The Inefficiency of the ‘Great Unpaid’ – The Principles on which Reconstruction should proceed – The Principle of Neighbourhood – The principle of Differentiation of Neighbourhoods – The principle of Direct Election – The Principle of the General Representatives – The Correspondence of Area and Functions – The Local Government of Tomorrow – The Representation of the Citizen-Consumer – The Local Councillor – Vocational Representation – Committees of Management – Machinery for Collective Bargaining – The Practicability of Vocational Self-Government in Municipal Government – The Industries and Services of Local Authorities – Emulation among Local Authorities – The Federation of Local Authorities – The Relation of Municipal Institutions to the Social and Political Parliaments.

5 – the Sphere of Voluntary Associations of Consumers in the Socialist Commonwealth

The Co-operative Movement – The Limitations of the Cooperative Movement – Constitutional Changes in the Cooperative Movement – Other Voluntary Associations of Consumers – Adult Education – The Future of the Country House – The Extension of Personality – The Problem of the Press – The Safeguarding of the Public Interest.

6 – The Reorganisation of the Vocational World

The Trade Union Movemewnt as the Organ of Revolt against the Capitalist System – The Right of Self-Determination for each Vocation – What Constitutes a Vocation – The Right of Free Enterprise for Socialised Administrations – Vocational Organisation as a Stratified Democracy; (a) How will each Vocation be recruited? (d) The Relative Position of Obligatory and Voluntary Organisation in a Vocation; (e) The Function of Vocational Organisation; (f) Subject Associations; (g) The Development of Professional Ethic; (h) Vocational Administration of Industries and Services; (i) Is there any Place for a National Assembly of Vocational Representatives?

7 – The Transitional Control of Profit-Making Enterprise

The Policy of the National Minimum – The Promotion of Efficiency and the Prevention of Extortion – The Standing Committee on Productivity – The Fixing of Prices – The Method of Expropriation – Taxation – The Relation of Prices to the National Revenue – The continuous Increase in a Socialist Commonwealth of Private Property in Individual Ownership – How Capital will be provided – The Transition and its Dangers- The Spirit of Service – The Need for Knowledge.

I’ve been interested in reading it for a little while, but finally decided to order it after reading in Shaw’s The Intelligent Woman’s Guide to Socialism, Capitalism, Sovietism and Fascism that the Webb’s included an industrial parliament in their proposed constitution. I’d advocated something similar in a pamphlet I’d produced arguing that parliament was dominated by millionaires and managing directors – over 70 per cent of MPs have company directorships – working people should have their own parliamentary chamber.

The book is a century old, and doubtless very dated. It was republished in the 1970s during that decades’ acute trade union unrest and popular dissatisfaction with the corporative system of the management of the economy by the government, private industry and the trade unions. These problems were all supposed to have been swept away with the new, private-enterprise, free market economy introduced by Maggie Thatcher. But the problem of poverty has become more acute. The privatisation of gas, electricity and water has not produced the benefits and investment the Tories believed. In fact electricity bills would be cheaper if they’d remained in state hands. Ditto for the railways. And the continuing privatisation of the NHS is slowly destroying it for the sake of expensive, insurance-financed private medical care that will be disastrous for ordinary working people.

And the growing poverty through stagnant wages and welfare cuts, seen in the growth of food banks, is also partly due to the destruction of trade union power and the exclusion of working people from the management of their companies and industries.

I haven’t yet read it, but look forward to doing so because I feel that, despite Tory lies and propaganda and no matter how dated, the Webbs’ proposals and solutions are still acutely relevant and necessary.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Trump Blames Imaginary Far Left Conspiracy and the Press for BLM Protests and Riots

Someone really, really should take Trump’s phone away from him and shut down his personal internet connections. He really has no idea how to calm things down. His idea of pouring oil on troubled waters is to throw petrol onto fire. He didn’t address the American people about the crisis that has engulfed his country after former police officer Derek Chauvin killed George Floyd by asphyxiation by kneeling on his neck. Instead he tweeted ill-chosen comments about shooting looters. Then his bodyguards rushed him to a ‘special secure bunker’ in case the crowd outside the White House tried to storm it.

As Mike has shown in his article about the incident, quite a few of the peeps on Twitter also drew comparisons between Trump, and a couple of other people with extreme right-wing beliefs, who also went into hiding. Like a certain A. Hitler, who likewise hid in a bunker, and our own Boris Johnson, who ran away from awkward media questions in a fridge.

See: https://voxpoliticalonline.com/2020/06/01/trump-hides-in-a-bunker-while-us-descends-into-chaos-over-george-floyd-killing/

Now he’s made more inflammatory texts, blaming the disturbances on a ‘far-left’ conspiracy and stating it seems that this is concert with the lamestream media. Other far right nutters, like Andy Ngo of The Spectator USA, have also claimed that this is some kind of revolution that the far left has been preparing for years. According to today’s I, Trump tweeted about the rioting in New York, “New York was lost to the looters, thugs, Radical Left & Scum. The Governor refuses to accept my offer of a dominating National Guard. NYC was ripped to pieces.” New York’s mayor, Bill de Blasio, said that he was not going to use the National Guard, as when forces not trained to handle New York City crowds intervene, ‘still with loaded weapons and under stress, horrible things happen.’ Some of this reluctance may come from the memories of the 1968 race riots and the shooting of four people at Ohio University by the National Guard, called in by Richard Nixon.

I doubt very, very much that there’s any far left conspiracy behind the protests and rioting. The issue of police brutality towards Blacks, and the unprovoked killing of unarmed Black people by the cops has been simmering away for the past few years or so. It’s what Black Lives Matter was formed to protest. And underneath that are the continuing problems of racism, poverty and poor Black academic achievement in schools. Only a few years ago Barak Obama was being lauded for winning the race to the White House and becoming America’s first Black president. The country, it was said, had now entered a ‘post-racial’ age. In fact, the divisions remained under Obama. Things were undoubtedly better under him for most Americans than if the Republicans had won, but Obama was a corporatist Democrat. He described himself as a ‘moderate Republican’, and so the neoliberal policies that have created so much poverty in America and round the globe, continued. American jobs went overseas and Obama went ahead with trying to close down America’s public (state) school system by transforming them into Charter Schools, the equivalent of the privately run state academies over here. Their transformation is often against the wishes of parents, teachers and the wider community. But the privatisation was still pushed, and is still being pushed by Trump. Welfare is being cut, and wages for ordinary Americans, of whatever colour, have remained stagnant for years. If they haven’t actually fallen in real terms, that is.

America has also become more racist as the trade unions and old industries, which employed both Whites and Blacks and brought people of different races together were smashed. It’s created a more atomised and racially segregated society. The old forms of community which crossed racial barriers have declined partly due to the ‘White flight’ which saw White people migrate away from the inner city towards the suburbs. The book attacking the Neocons and their toxic policies, Confronting the New Conservatism, argued that this is what fueled the rise of George Dubya Bush’s administration. And the same processes are at work in Britain too. Hence the victories of the Tories over here, the disproportionate numbers of British Blacks and Asians dying from the Coronavirus, and the consequent Black anti-racist protests in Britain.

There might be some extreme left-wing malcontents stirring the crowds up. I remember during the race riots that hit St Paul’s in Bristol in the early 1980s a White man with a long, grey beard hanging around the school gates with a megaphone as we went home. He was haranguing us, trying to get us to join the rioting. I didn’t realise it at the time, but thinking about it, it seems to me very likely he was from the Socialist Workers Party or similar far left organisation. They have a reputation for joining any kind of protest and trying to radicalize it or exacerbate the problem. But the SWP in Britain was and is miniscule. They’ve been criticised by their left-wing opponents because they don’t ever start protests, they merely colonise those of others. The riots in St. Paul’s started over heavy-handed policing, and specifically a raid on the Black and White Cafe, which had a reputation for drug dealing. The underlying grievances were the same then – racism, unemployment and poverty. The SWP, Workers’ Revolutionary Party, British Communist Party or any other radical left group weren’t behind the riots then, whatever White guys with megaphones may have tried to do. They aren’t behind the protests and riots in America now.

There is no far left conspiracy at work here. Just poverty and despair caused by four decades of neoliberalism, Neoconservatism, Reaganomics, Thatcherism and just plain, old Conservatism. Tackling the protests will mean not only tackling racism, but also the economic and social grievances underneath them. Grievances that the Conservatives and Republicans exploit to bolster their own horrific policies.

If we want to create a better society for everyone, regardless of their colour, it means getting rid of Conservative policies as well as stopping the police from killing people.

And in the meantime, Trump should also stop making things worse with his stupid Tweets.

Job Training Mismatch and the COVID-19 Recovery: A Cautionary Note from the Great Recession

Published by Anonymous (not verified) on Wed, 27/05/2020 - 9:00pm in

Benjamin G. Hyman and Karen X. Ni

 A Cautionary Note from the Great Recession

Displaced workers have been shown to endure persistent losses years beyond their initial job separation events. These losses are especially amplified during recessions. (1) One explanation for greater persistence in downturns relative to booms, is that firms and industries on the margin of structural change permanently shift the types of tasks and occupations demanded after a large negative shock (Aghion et al. (2005)), but these new occupations do not match the stock of human capital held by those currently displaced. In response to COVID-19, firms with products and services that complement social-distancing (like Amazon distribution centers) may continue hiring during and beyond the recovery, while workers displaced from higher risk industries with more stagnant demand (for example, airport personnel, local retail clerks) are left to adjust to less familiar job opportunities. As some industries reopen gradually while others remain stunted, what role might workforce development programs have in bridging the skill gap such that displaced workers are best prepared for this new reality of work?

Returns to Job Training Over the Business Cycle

To examine the role of workforce development programs, we studied earnings recovery paths and occupation choices for participants in Trade Act related retraining programs before and during the Great Recession, assembling trainee data from Hyman, Kovak, and Leive (2020), Park (2012), and Reynolds and Palattuci (2012). We first compared wage replacement rates—the fraction of pre-layoff earnings “replaced” as workers recover from job loss—for displaced workers who jointly enrolled in retraining programs and extended unemployment insurance (UI), to a control group that was approved for the same package but “waived out” of the training component and only received extended UI. These waivers are most often offered when workers claim to already possess the skills needed by the labor market or no suitable training program is available to workers in their desired vocation due to capacity constraints.

We implement an event study model with worker demographic controls and quarter-of-application fixed effects, which enables us to trace out returns to the retraining component from UI several quarters around a worker’s displacement event. Although our goal is not causal, to the extent that differences in worker selection into training and UI-only groups are captured by time-invariant worker characteristics and calendar quarter fixed effects capturing group-specific demand factors, this allows us to cautiously interpret these descriptive results. Below, we show these estimates separately for workers laid off in normal times versus those who were displaced during the downturn.

 A Cautionary Note from the Great Recession

The results suggest a striking story: Although, on average, all worker groups only partially recovered from their initial layoff in the short run, those who retrained (red series) only exhibited better outcomes when the economy was steaming ahead in normal times. Why did job training through the Trade Act program appear less effective during the Great Recession?

One natural explanation for this result might be that workers committing to lengthy retraining programs face a penalty for entering increasingly competitive labor markets late. Indeed, Rothstein (2012) finds that most of the sluggish recovery can be explained by aggregate demand factors. Here, we explore an alternative hypothesis: During the Great Recession, some workers trained for the “wrong” occupations because workforce development programs could not predict the permanence of rapidly changing skills demanded in the post-recession economy—we call this job training mismatch.

A Job Training Mismatch Index

To test whether job training mismatch correlates with differential earnings returns over the business cycle, we follow the pioneering work of Şahin et al. (2014) and construct a mismatch index intended to capture the extent to which occupations targeted in retraining programs “match” the composition of newly posted online job vacancies using data from The Conference Board Help Wanted OnLine® (HWOL). Our reduced form index creates a measure in each quarter t, capturing whether currently targeted occupations are under- or over-training for a given labor market’s occupational needs, calculated as follows:

 A Cautionary Note from the Great Recession

Here, the innermost term considers the difference in the share of vacancies posted in a given occupation o versus the share of total trainees targeting that same occupation, which are then weighted by the number of trainees in each occupation (wogt). An index value of 0 would reflect a “perfectly matched” labor market, whereas any departure from 0 would be mismatched. We also include a geography term g so that we can decompose the overall index by more refined geographies (assuming job seekers are constrained to those markets). The chart below plots this mismatch index for three-digit SOC occupation codes over quarters, both for the U.S. labor market as a whole, and weighting by mismatch in each state.

 A Cautionary Note from the Great Recession

The time series shows that the index nearly doubled from its pre-recession trough to post-recession peak, suggesting that Great Recession job training programs were not meeting the occupational needs of their labor markets. To dissect this further, we computed the mismatch index separately within each state, and allowed the index to be positive or negative (removing the absolute value). This allows for the convenient interpretation that we can study whether distinct labor markets were over- or under-training with respect to jobs demanded.

In the chart below, we show these results for the top twenty-five trainee states (which cover over 90 percent of all trainees), where the size of each bubble corresponds to the share of trainees in each period (pooled pre- and post-recession).

 A Cautionary Note from the Great Recession

Analyzing training mismatch by state reveals that a handful of states, such as Ohio, drive the overall results. In fact, these results are particularly influenced by one occupation: production workers (including metal and plastic). Interestingly, the plot also reveals that all states over-trained on average with respect to occupational demand, although some individual occupations like computer programmers did train a lower share of workers relative to vacancies. (We find that 28 percent of workers were in occupations exhibiting such “under-training”.) These results are consistent with prior work in Hyman (2018), which showed that workers retraining in their separation industries were not recalled at the rate they were expecting, whereas those that switched industries and labor markets performed better. Simply put, in occupations and labor markets that never completely recovered from the recession, training programs also failed to adjust fully to new demand.

Silver Lining

While the result discussed here is largely negative, it highlights the difficulties in adjusting workforce development programs to uncertain structural changes in occupational demand. Although a handful of states improved their targeting, COVID-19 mismatch is likely to be more widespread than trade-impacted industries during the Great Recession. One alternative to making workforce development programs more nimble, as suggested by a number of authors and policymakers (see a summary here), is to instead provide “wage insurance” cash transfers that subsidize some of the difference between prior and new jobs if the latter pays a lower wage. In ongoing work, Hyman, Kovak, and Leive (2020) are exploring the effects of such programs in the context of the Trade Adjustment Assistance program which, since 2002, has offered workers over the age of 50 up to $10,000 in such transfers as an alternative to retraining.

(1) Autor et al. (2016) and Sullivan and Von Wachter (2009) estimate the long-run persistence of displacement on earnings and mortality rates, while Schmieder et al. (2016) study effects across the business cycle.

Benjamin G. Hyman

Benjamin G. Hyman is an economist in the Federal Reserve Bank of New York’s Research and Statistics Group.


Karen X. Ni is a senior research analyst in the Bank’s Research and Statistics Group.

How to cite this post:

Benjamin G. Hyman and Karen X. Ni, “Job Training Mismatch and the COVID-19 Recovery: A Cautionary Note from the Great Recession,” Federal Reserve Bank of New York Liberty Street Economics, May 27, 2020, https://libertystreeteconomics.newyorkfed.org/2020/05/job-training-misma....




Disclaimer

The views expressed in this post are those of the authors and do not necessarily reflect the position of the Federal Reserve Bank of New York or the Federal Reserve System. Any errors or omissions are the responsibility of the authors.

Productivity and Income … Again

Published by Anonymous (not verified) on Sat, 23/05/2020 - 8:08pm in

Today I’m going to revisit a topic that a month ago I committed to stop writing about — the productivity-income quagmire. Neoclassical economists argue that income is proportional to productivity. The problem is that they have no way of measuring productivity that is independent of income. So in practice, they test their theory by assuming it’s true. They show that one form of income — value added per worker — is correlated with another form of income — wages.

In No Productivity Does Not Explain Income, I pointed out this circularity. And I haven’t heard the end of it since. The problem, critics say, is that my argument is flawed. Yes, value added and wages are related by an accounting definition. But that doesn’t ‘guarantee’ (in strict mathematical terms) a correlation between the two. In an update post, I admitted that the critics were correct. It is possible for wages and value added per worker to be uncorrelated.

Does this mean my argument is fatally flawed? No. But I will admit that the language in the original post was slightly overheated. The accounting definition between wages and value added doesn’t guarantee a correlation between the two. It virtually guarantees one.

I’m going to show you here that yes, it’s possible for wages and value added per worker to be uncorrelated. But it’s so unlikely that it’s not worth considering. The reality is that because of the underlying accounting definition, it’s virtually guaranteed that we’ll find a ‘statistically significant’ correlation between wages and value added per worker.

The accounting definition

Let’s revisit how neoclassical economists test their theory of income. What they should do is measure the productivity of workers and see how it relates to income. But for a host of reasons, economists don’t do this. The most basic problem is that workers do different activities. This makes it impossible to compare their outputs. How, for instance, do you compare the output of a musician with the output of a farmer? The only logical answer is that you can’t — at least not objectively.

Realizing this problem should have caused neoclassical economists concern. It means that their theory is untestable. But instead of admitting defeat, neoclassical economists devised a loophole. To test their theory, they assume that one form of income (value added) actually measures productivity. Then they compare this income to another form of income (wages). The two types of income are correlated! Productivity explains income!

No.

The problem is that economists never actually measure productivity. Instead, they show that two types of income are correlated. But these two types of income are related by an accounting definition. And this accounting definition, I claim, (virtually) guarantees a correlation.

Let’s dive into the math.

Economists want to show that wages correlate with productivity — a fundamental tenet of their theory of income. To do this, they measure productivity in terms of value added per labor hour (or sales per labor hour, if data for value added is unavailable).

Let’s put this test in math form. Let w be the average wage of workers in a firm. Let Y be the value added of the firm. And let L be the labor hours worked by all workers in the firm. Economists look for a correlation between average wages (w) and value-added per labor hour (Y/L):

\displaystyle w \longleftrightarrow \frac{Y}{L}

The problem is that the left-hand and right-hand sides of this comparison aren’t independent from each other. Instead, they’re connected by an accounting definition. Let’s look at it.

Value added is, by definition, the sum of the wage bill (W) and profits (P):

Y = W + P

Now let’s calculate value added per labor hour. We take value added Y and divide it by labor hours L. To maintain the equality, we also divide the right-hand side by L:

\displaystyle \frac{Y}{L} = \frac{W + P}{L}

Now let’s distribute the L to the two terms in the numerator:

\displaystyle \frac{Y}{L} = \frac{W }{L} + \frac{P}{L}

What is W / L? It’s the wage bill divided by the number of labor hours. This happens to be the average hourly wage, w. So value-added per worker is equivalent to the average wage plus some noise term:

\displaystyle \frac{Y}{L} = w + \text{noise}

Given this accounting definition, it’s unsurprising that wages correlate with value added per labor hour. But do the two terms have to correlate? In strict math terms, no. If the noise term is large, it will drown out the correlation between wages and value added.

The problem is that the noise term is itself likely to correlate with value added per worker. Why? Because the noise term is actually profit per labor hour (P/L). It shares the same denominator (L) with value add per labor hour (Y / L). This codependency increases the chance of correlation.

So yes, it is possible for wages and value added to be uncorrelated. But it is also extremely improbable.

Throwing numbers into the accounting formula

I want to show you just how probable it is that we’ll find a correlation between wages and value added per worker. Here’s how I’m going to do it. I’m going to randomly generate values for the wage bill (W), profit (P) and labor hours (L) of imaginary firms. Then I’ll throw these values into the accounting definition. Finally, I’ll look for a correlation between the average wage and value added per labor hour.

Just so I’m clear, here’s the steps:

  1. Draw random values for the wage bill W and profit P of firms
  2. Use these numbers to define value added: Y = W + P
  3. Randomly generate a value for the number of labor hours (L) worked in each firm
  4. Compare value added per labor hour (Y/L) to the average wage (w = W/L)

To generate the random numbers, we have to assume some sort of distribution. I’ll assume that W, P and L come from a lognormal distribution — a distribution that is common among economic phenomena. Because I want a general test, I’ll also assume that the parameters of this lognormal distribution are themselves random. See the notes for the math details and code.

If you want a simple metaphor for this process, think of defining W, P and L by rolling a dice. But each time we roll, the number of dice varies. This means that W, P and L can vary over a large range.

Judging correlation

With our random numbers in hand, we plug them into our accounting definition and look for a correlation between value added per worker and the average wage. Here things get slightly more complicated.

It’s easy to measure correlation — just calculate the correlation coefficient (r) or the coefficient of determination (R2). The problem is that correlation exists on a scale. To say that two variables are ‘correlated’, we need to decide on some arbitrary threshold. This entails a value judgment.

For better or for worse (mostly for worse), the standard practice in econometrics is to hide this value judgment in more math. We define something called the p-value’ of the correlation. Then we judge correlation (or lack thereof) based on an arbitrary threshold in the p-value.

What’s a ‘p-value’? It’s a probability. The p-value tells you the probability of getting your observed correlation (or greater) from random numbers. The lower the p-value, the more ‘statistically significant’ your correlation.

Using p-values depends on a host of assumptions, many of which are violated when we study economic phenomena. Worse still, there are many ways to rig the game so you get better (i.e. lower) p-values. It’s called p-hacking, and it’s a huge problem in the social sciences.

Despite these problems, I’m going to use p-values to judge the correlation between simulated wages and value added per worker. I do so not because I like p-values (I don’t), but because using them is the standard practice in econometrics. Getting a low p-value means your results are publishable. Your correlation is ‘significant’! (If you want to read about how silly this is, check out the book The cult of statistical significance.)

Correlation from randomness

With our p-values in tow, here’s the question we want to ask. If we plug random numbers into our accounting definition, how likely is it that the correlation between wages and value added per worker will be ‘statistically significant’?

The answer, it seems, is very likely. Although we’re dealing with random numbers, a ‘significant’ correlation between simulated wages and value added per worker seems to be in the cards. Table 1 tells the story.

Table 1: Correlation from randomness

P-value (%)
Portion of results below p-value (%)

5.00
99.96

1.00
99.94

0.10
99.91

0.01
99.89

Let’s unpack the results. I have a model that throws random numbers into our accounting definition. For each set of random numbers, I calculate the p-value of the correlation between wages and value added per labor hour. Then I look at how often these p-values are below some critical value. The left-hand column in Table 1 shows various thresholds for the p-value. The right-hand column shows the portion of the simulations in which the p-value is below this critical value for ‘statistical significance’.

By throwing random numbers into our accounting definition, we get a ‘statistically significant’ correlation 99.9% of the time. Note that this holds no matter how stringent our level of statistical significance. Even for the very low (in the social sciences) p-value of 0.0001, some 99.89% of the results are ‘statistically significant’. It seems that by throwing numbers into our accounting definition, a ‘statistically significant’ correlation between wages and value added per worker is virtually guaranteed.

Let’s look at the simulation results another way. Figure 1 shows how the p-values are distributed across all of the simulations. Most of the p-values are so small (meaning the correlation is so ‘significant’) that I have to plot p on a log scale. The x-axis shows the logarithm of the p-value. The y-axis shows the relative frequency of each p-value. To get some perspective, the vertical red line shows the standard threshold for statistical significance, a p-value of 0.05. Virtually all of the results are below this value, meaning the correlation is ‘statistically significant’.

Figure 1: The distribution of p-values. Here’s how the logarithm of p is distributed across 20,000 iterations of my simulation.

Figure 2 shows yet another way of looking at the simulation results. Instead of plotting p-values, here I look at the distribution of the f-statistic. The f-statistic is another way of measuring ‘statistical significance’ (p-values are actually derived from the f-statistic). But whereas a lower p-value is ‘more significant’, a higher f-statistic is ‘more significant’.

Figure 2: The distribution of f-statistics. Here’s how the logarithm f is distributed across 20,000 iterations of my simulation.

As with p-values, the f-statistics are so extreme that I need to plot their logarithm. The vertical red line in Figure 2 shows the threshold for statistical significance at the 5% level. Results with an f-statistics above this value are deemed ‘statistically significant’. Again, we see that the vast majority of results are ‘statistically significant’.

It seems that by throwing random numbers into our accounting definition, we can’t help but find a correlation between wages and value added per worker.

Manufacturing correlation

The charge that I’ve laid against neoclassical economists is that when they test their theory of income, they’re fooling themselves. Their method (virtually) guarantees a positive result. They regress two types of income — wages and value added per labor hour — that are related by an accounting definition. The problem is that this accounting definition (virtually) guarantees a statistically significant correlation.

Now the degree to which this correlation is guaranteed depends on the specifics of how the wage bill, profit and labor hours are distributed. But what I’ve shown here is that across a huge class of numbers, a ‘statistically significant’ correlation is almost unavoidable. It’s manufactured by our accounting definition.

This result highlights a problem with how economists use p-values. The use of p-values has turned into a production function: run a regression → get a low p-value → get published. Rarely do economists question whether the assumptions behind p-values are actually met in the real-world data.

In my simulation, the assumptions behind p-values are systematically violated. To use them, we must assume that our data is ‘statistically independent’. Here, this means that wages and value added per labor hour can be treated as independent, random variables. The problem is that they’re not independent. Wages and value add per labor hour are related by an accounting definition. This renders them highly dependent. So the use of p-values is moot.

Still, p-values are the standard by which economists judge correlation. By this standard, our accounting definition virtually guarantees a ‘statistically significant’ correlation between wages and value added per labor hour.

The larger problem

The larger problem here is that the marginal productivity theory of income is untestable. Its core components — productivity and the ‘quantity’ of capital — cannot be measured objectively. If you want to know more about these problems, I recommend John Pullen’s book The Marginal Productivity Theory of Distribution: A Critical History.

The reality is that when it comes to explaining income, there is a long and sordid history of political economists fooling themselves. Neoclassical economists may be the most visible fools, but they’re by no means the only ones. Marxists too test their theory of income in circular terms. If you’re interested in Marxist theory, check out the debate between Jonathan Nitzan, Shimshon Bichler and the Marxist Paul Cockshott. What appears to be evidence for the labor theory of value, Nitzan and Bichler show, is actually mathematical foolery.

This issue of circular testing cuts to a core problem in both neoclassical and Marxist theories of income. Both explain income in terms of quantities that are unobservable. Unsurprisingly, tests of these theories resort to circular logic. Such tests invariably show that two forms of income are correlated. Then they claim that one form of income is something other than what it seems.

Sadly, this foolery has been standard practice for a century. And that’s not really surprising. There is perhaps no topic in which objectivity is more difficult than the distribution of income. Still, if we want a scientific theory of income, we need to do better. We need to stop fooling ourselves.

Notes

Here’s my model. I assume that profit (P), the wage bill (W) and the number of labor hours (L) in firms are random variables that are lognormally distributed. If you’re not familiar, the lognormal distribution looks like a bell curve when you take the logarithm of its values. If the variable x is lognormally distributed, log(x) is normally distributed. Many quantities in economics are lognormally distributed, which is why I use this function here.

The lognormal distribution has two parameters, the ‘location’ parameter mu and the ‘scale’ parameter sigma. I’ll denote the lognormal distribution with the notation used in R. If x is lognormally distributed with parameters mu and sigma, I denote it as:

x = lnorm(mu, sigma)

To assume almost nothing about the distribution of P, W and L, I let the parameters of the lognormal distribution vary randomly over a uniform distribution. I’ll denote the uniform distribution using the notation used in R. If x is a uniformly distributed over the range 0 to 1, we write:

x = runif(0, 1)

I let the parameters of the lognormal distribution vary between 0 and 10. If you’re familiar with the lognormal distribution, you’ll know that this is a huge parameter space. So the values of P, W and L are:

P = lnorm( mu = runif(0, 10), sigma = runif(0, 10))

W = lnorm( mu = runif(0, 10), sigma = runif(0, 10))

L = lnorm( mu = runif(0, 10), sigma = runif(0, 10))

I take these values and throw them into the accounting definition. Average wages are then W / L. Value added per worker is (W + P) / L. To see how the correlation between wages and value added per worker varies, I run the algorithm several thousand times.

Code

Here’s the R code for the model. Run it for yourself and see what you find.

library(doSNOW)

n_test = 20000
n_firms = 10^4

# cluster
cl = makeCluster(4, type="SOCK")
registerDoSNOW(cl)
clusterSetupRNG (cl, type = "RNGstream")

# progress Bar
pb = txtProgressBar(max = n_test, style = 3)
progress = function(n) setTxtProgressBar(pb, n)
opts = list(progress = progress)

test = foreach(i = 1:n_test, .options.snow=opts, .combine=rbind) %dopar% {

# wagebill
mu = runif(1, 0, 10)
sigma = runif(1, 0, 10)
wagebill = rlnorm(n_firms, mu, sigma)

# profit
mu = runif(1, 0, 10)
sigma = runif(1, 0, 10)
profit = rlnorm(n_firms, mu, sigma)

# value added (sum of wagebill and profit)
value_added = wagebill + profit

# labor hours
mu = runif(1, 0, 10)
sigma = runif(1, 0, 10)
labor_hours = rlnorm(n_firms, mu, sigma)

# hourly wage
hourly_wage = wagebill / labor_hours

# valued added per labor hour
va_per_hour = value_added / labor_hours

# regress value added per hour and hourly wage
r = lm( log(va_per_hour) ~ log(hourly_wage) )

f = summary(r)$fstatistic

f_stat = f[1]
p = pf(f[1],f[2],f[3],lower.tail=F)
r2 = summary(r)$r.squared

output = data.frame(f_stat, p, r2)

}
stopCluster(cl)

# portion that are significant
sig_frac = length(test$p[ test$p < 0.05 ]) / length(test$p)

# f statistic
hist(log10(test$f_stat), breaks = 100, xlim = c(0, 10))
abline(v = log10(3.85), col = "red" )

# export
write.csv(test, "test_data.csv")

Further reading

Cockshot, P., Shimshon, B., & Nitzan, J. (2010). Testing the labour theory of value: An exchange. http://bnarchives.yorku.ca/308/02/20101200_cockshott_nitzan_bichler_testing_the_ltv_exchange_web.htm

Pullen, J. (2009). The marginal productivity theory of distribution: A critical history. London: Routledge.

Ziliak, S., & McCloskey, D. N. (2008). The cult of statistical significance: How the standard error costs us jobs, justice, and lives. University of Michigan Press.

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Tony Benn on Overseas Investment at the Expense of Britain’s Workers

Published by Anonymous (not verified) on Sun, 17/05/2020 - 8:57pm in

A few days ago I posted up a piece about Shaw’s critique of British imperialism. As I said in the earlier piece, Shaw wasn’t against imperialism in itself, if it had been genuinely for the benefit of the conquered peoples. But it wasn’t. It was really to exploit them, as a cheap workforce unprotected by the Factory Acts in Britain which protected domestic workers. The result was the exploitation of non-Whites abroad, while British manufacturers were ruined by the import of the cheap goods they produced, and British workers made unemployed.

This situation still remains, thanks to globalisation and the rise of the multinationals even though the British empire is no more. Tony Benn was a staunch opponent of the multinationals and the same abuses of overseas investment. In a 1985 speech in parliament on unemployment, Benn said

We would have to stop the export of capital. Since the government came to power, for every family of four, £4,300 has left Britain. The Chancellor of the Exchequer says that we must tighten our belts because that is the way to solve the problem. But if a worker tightens his belt, the employer sends the money to South Africa, where the wages are lower still, because Botha’s police will not allow the unions to organise. The export of capital could not continue if we wished to solve the unemployment problem.

Ruth Winstone, ed., The Best of Benn: Speeches, Diaries, Letter and Other Writings (London: Hutchinson 2014) p. 166.

That’s still very pertinent today, when Tory donor James Dyson has moved his plants to the Far East and Jacob Rees-Mogg has investments all over the world, including in a condom factory in Indonesia.

Tony Benn – the greatest Prime Minister this country never had.

Shaw’s Classic Defence of Socialism for Women Part Four

George Bernard Shaw, The Intelligent Woman’s Guide to Socialism, Capitalism, Sovietism and Fascism, foreword by Polly Toynbee (London: Alma Classics 2012).

Conclusion

While this a great book I immensely enjoyed, it also very much the product of its time. Shaw is unrealistic and more than a little sectarian himself in his advocacy of the equalization of incomes. He regards it as the real, fundamental goal of socialism and that unless they too believe in it, others advocating nationalisation aren’t real socialists. But the Soviets and various other socialist groups have tried the equalisation of incomes, and it didn’t work. But nevertheless, even if wages shouldn’t be exactly the same, the differences in wealth should very definitely be far less than they are now.

Similarly, I don’t entirely agree with his views on the unions. Now other socialists also struggled with the problems they posed for working class power. Trade unions by themselves aren’t socialist organisations. Their role is to fight for better wages and conditions for the workers, not to replace capitalism, and Lenin himself pondered how workers could go from ‘trade union consciousness’ to socialism. In the 1980s it was found that trade unionists often voted Tory, because of the improved quality of life they enjoyed. But the unions are nevertheless vital working class organisations and are rightly at the heart of the Labour party, and have provided countless working class leaders and politicians.

Shaw was right about the coal mines, and his description of the results of the great differences in viability between them and the comparative poverty or wealth of the mining companies was one of the reasons they were nationalised by Labour under Clement Attlee.  He’s also right about nationalising the banks. They don’t provide proper loans for the small businessman, and their financial shenanigans have resulted, as Shaw noted in his own day, in colossal crashes like that of 2008. He is also right about the rich sending their money abroad rather than contributing to the British economy. In his time it was due to imperialism, and there is still a hangover from this in that the London financial sector is still geared to overseas rather than domestic investment. It’s why Neil Kinnock advocated the establishment of a British investment bank in 1987. Now, in the early 21st century, they’re also saving their money in offshore tax havens, and British manufacturers have been undercut and ruined through free trade carried out in the name of globalisation.

His arguments about not nationalising industries before everything has been properly prepared, and the failures of general strikes and revolutions are good and commonsense. So is his recommendation that capitalism can drive innovation. On the other hand, it frequently doesn’t and expects the state to bail it out or support it before it does. I also agreed with Shaw when he said that companies asking for government subsidies shouldn’t get them unless the gave the government a part share in them. That would solve a lot of problems, especially with the outsourcing companies. They should be either nationalised or abolished.

I can’t recommend the book without qualifications because of his anti-religious views. Shaw also shows himself something of a crank when it comes to vaccination. As well as being a vegetarian and anti-vivisectionist, which aren’t now anywhere near as remarkable as they once were, he’s against vaccination. There are parts of the book which are just anti-vaxxer rants, where he attacks the medical profession as some kind of pseudo-scientific priesthood with sneers at the religion of Jenner. He clearly believes that vaccination is the cause of disease, instead of its prevention. I don’t know if some of the primitive vaccinations used in his time caused disease and death, but it is clear that their absence now certainly can. Children and adults should be vaccinated because the dangers of disease are far, far worse.

Shaw also has an unsentimental view of the poor. He doesn’t idealise them, as poor, ill-used people can be terrible themselves, which is why poverty itself needs to be eradicated. In his peroration he says he looks forward to the poor being exterminated along with the rich, although he has a little more sympathy for them. He then denies he is a misanthrope, and goes on to explain how he likes people, and really wants to see people growing up in a new, better, classless socialist future.

While I have strong reservations about the book, it is still well-worth reading, not least because of Shaw’s witty turns of phrase and ability to lampoon of capitalism’s flagrant absurdities. While I strongly reject his anti-religious views, his socialist ideas, with a few qualifications, still hold force. I wish there were more classic books on socialism like this in print, and widely available so that everyone can read them.

Because today’s capitalism is very much like the predatory capitalism of Shaw’s age, and becoming more so all the time.

 

 

 

Shaw’s Classic Defence of Socialism for Women Part Three

George Bernard Shaw, The Intelligent Woman’s Guide to Socialism, Capitalism, Sovietism and Fascism, foreword by Polly Toynbee (London: Alma Classics 2012).

Socialism and Marriage, Children, Liberty and Religion

Shaw also discusses what socialism would mean for marriage, liberty, children and the churches, and these are the most problematic sections of the book. He looks forward to marriage being a purely voluntary commitment, where people people can marry for love instead of financial advancement. This will produce biologically better children, because people will be able to choose the best partners, rather than be limited to only those from their class. At the same time incompatible partners will be able to divorce each other free of stigma.

He defines liberty in terms of personal freedom. Under socialism, people will be freer because the amount of time they will have for their personal amusement and recreation will be greater. Legislation might go down, because the laws currently needed to protect people will become unnecessary as socialism is established and society advances. Shaw also believes that greater free time would be enough to attract the top brains to management positions in the absence of the usual inducement of greater pay. Shaw realised that not everyone could run industries, and that it was necessary to hire the very best people, who would be a small minority. Giving them greater leisure time was the best way to do this, and he later criticises the Soviet government for not equalising incomes.

But this is sheer utopianism. The Bolsheviks had tried to equalise incomes, and it didn’t work, which is why they went back to higher rates of pay for managers and so on. And as we’ve seen, socialism doesn’t necessarily lead to greater free time and certainly not less legislation. The better argument is that socialism leads to greater liberty because under socialism people have better opportunities available to them for careers, sport, entertainment and personal improvement than they would if they were mere capitalist wage slaves.

Religious people will also object to his views on religion and the churches. While earlier in the book Shaw addressed the reader as a fellow Christian, his attitude in this section is one of a religious sceptic. The reader will have already been warned of this through the foreword by Toynbee. The Groaniad columnist is a high-ranking member of the both the Secular and Humanist Societies, and her columns and articles in just about every magazine or newspaper she wrote for contained sneers at religion. Shaw considers the various Christian denominations irreconcilable in their theologies, and pour scorn on orthodox Christian doctrines such as the Atonement, that Christ died for our sins. Religion should not be taught in school, because of the incompatibility of the account of the Creation in Genesis with modern science. Children should not be taught about religion at all under they are of the age of consent. If their parents do teach them, the children are to be removed from their care. This is the attitude of very aggressive secularists and atheists. Richard Dawkins had the same attitude, but eventually reversed it. It’s far too authoritarian for most people. Mike and I went to a church school, and received a very good education from teachers that did believe in evolution. Religion deals with ultimate questions of existence and morality that go far beyond science. I therefore strongly believe that parents have the right to bring their children up in their religion, as long as they are aware of the existence of other views and that those who hold them are not wicked simply for doing so. He also believed that instead of children having information pumped into them, the business should be to educate children to the basic level they need to be able to live and work in modern society, and then allow the child to choose for itself what it wants to study.

Communism and Fascism

This last section of the book includes Shaw’s observations on Russian Communism and Fascism. Shaw had visited the USSR in the early ’30s, and like the other Fabians had been duped by Stalin. He praised it as the new socialist society that was eradicating poverty and class differences. He also thought that its early history vindicated the Fabian approach of cautious nationalisation. Lenin had first nationalised everything, and then had to go back on it and restore capitalism and the capitalist managers under the New Economic Policy. But Russia was to be admired because it had done this reversal quite openly, while such changes were kept very quiet in capitalism. If there were problems in the country’s industrialisation, it was due to mass sabotage by the kulaks – the wealthy peasants – and the industrialists. He also recognised that the previous capitalist elite were disenfranchised, forced into manual labour, and their children denied education until the working class children had been served. At the same time, the Soviet leaders had been members of the upper classes themselves, and in order to present themselves as working class leaders had claimed working class parentage. These issues were, however, gradually working themselves out. The Soviet leaders no longer had need of such personal propaganda, and the former capitalists could reconcile themselves to the regime as members of the intellectual proletariat. And some of the industrialisation was being performed by criminals, but this was less arduous than the labour in our prisons.

Shaw is right about the NEP showing that nationalisation needs to be preceded by careful preparation. But he was obviously kept ignorant of the famine that was raging in the USSR through forced collectivisation and the mass murder of the kulaks. And rather than a few criminals in the gulags, the real figures were millions of forced labourers. They were innocent of any crime except Stalin’s paranoia and the need of his managers for cheap slave labour. It’s believed that about 30 millions died in Stalin’s purges, while 7 million died in the famine in the Ukraine.

Shaw’s treatment of Fascism seems to be based mostly on the career of Mussolini. He considers Fascism just a revival of the craze for absolute monarchy and military leadership, of the kind that had produced Henry VIII in England, Napoleon, and now Mussolini, Adolf Hitler, the Shah of Iran and Ataturk in Turkey. These new absolute rulers had started out as working class radicals, before find out that the changes they wanted would not come from the working class. They had therefore appealed to the respectable middle class, swept away democracy and the old municipal councils, which were really talking shops for elderly tradesmen which accomplished little. They had then embarked on a campaign against liberalism and the left, smashing those organisations and imprisoning their members. Some form of parliament had been retained in order to reassure the people. At the same time, wars were started to divert the population and stop them criticising the new generalissimo. Industry was approaching socialism by combining into trusts. However, the government would not introduce socialism or truly effective government because of middle class opposition. Fascist regimes wouldn’t last, because their leaders were, like the rest of us, only mortal. In fact Mussolini was overthrown by the other Fascists, who then surrendered to the Allies, partly because of his failing health. That, and his utter military incompetence which meant that Italy was very definitely losing the War and the Allies were steadily advancing up the peninsula. While this potted biography of the typical Fascist is true of Mussolini, it doesn’t really fit some of the others. The Shah, for example, was an Indian prince.

Anarchism and Syndicalism

Shaw is much less informed about anarchism. He really only discusses it in terms of ‘Communist Anarchism’, which he dismisses as a silly contradiction in terms. Communism meant more legislation, while anarchism clearly meant less. He should have the articles and books on Anarcho-communism by Peter Kropotkin. Kropotkin believed that goods and services should be taken over by the whole community. However, rather than a complete absence of government and legislation, society would be managed instead by individual communities and federations.

He also dismisses syndicalism, in which industry would be taken over and run by the trade unions. He considers this just another form of capitalism, with the place of the managers being taken by the workers. These would still fleece the consumer, while at the same time leave the problem of the great inequality in the distribution of wealth untouched, as some industries would obviously be poorer than others. But the Guild Socialists did believe that there should be a kind of central authority to represent the interests of the consumer. And one of the reasons why nationalisation, in the view of some socialists, failed to gain the popular support needed to defend it against the privatisations of the Tories is because the workers in the nationalised industries after the War were disappointed in their hopes for a great role in their management. The Labour party merely wanted nationalisation to be a simple exchange of public for private management, with no profound changes to the management structure. In some cases the same personnel were left in place. Unions were to be given a role in management through the various planning bodies. But this was far less than many workers and trade unionists hoped. If nationalisation is to have any meaning, it must allow for a proper, expanded role of the workers themselves in the business of managing their companies and industries.

The book ends with a peroration and a discussion of the works that have influenced and interest Shaw. In the peroration Shaw exhorts the readers not to be upset by the mass poverty and misery of the time, but to deplore the waste of opportunities for health, prosperity and happiness of the time, and to look forward and work for a better, socialist future.

His ‘Instead of a Bibliography’ is a kind of potted history of books critical of capitalism and advocating socialism from David Ricardo’s formulation of capitalism in the 19th century. These also include literary figures like Ruskin, Carlyle and Dickens. He states that he has replaced Marx’s theory of surplus value with Jevons‘ treatment of rent, in order to show how capitalism deprives workers of their rightful share of the profits.

 

 

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