R. Palme Dutt

Capitalism or Socialism in Britain?

“Capitalist collapse or the Workers’ Revolution — this is no longer a debating issue of the future, it is a life and death issue, a fight for life.”

Written: 1931
Publisher: The Blackfriars Press, Ltd., London.
Source: Pamphlet
Transcription/Markup: Brian Reid
Public Domain: Marxists Internet Archive (2006). You may freely copy, distribute, display and perform this work; as well as make derivative and commercial works. Please credit “Marxists Internet Archive” as your source.

Capitalism or Socialism in Britain?

An examination of the crisis of capitalism in Britain and the issues before the working class

“Should English manufacturers be thus vanquished, the majority of the proletariat must become for ever superfluous and has no other choice than to starve or rebel.” — Engels


THE question before the workers in Britain is plain, urgent, inescapable. Capitalism in Britain is in decay. It can no longer even find employment for millions of workers. It can no longer organise production even on its own basis. Within this decay the fight between profits and the workers’ needs grows ever more desperate. Demands and yet more demands are pressed for cuts in wages, for drastic reduction of the social services, for speeding up, for lowered standards. Struggle after struggle develops of the workers against capitalism for the needs of life.

Where will this process end? The Labour Government and the trade unions offer no answer; they wait for a trade revival; they betray the workers to the capitalist attacks. For ten years they have led the workers to defeat after defeat. To-day the crisis is more intense than ever.

On every side new policies and new parties press forward and offer their solutions. “Tariffs,” “Economy,” “Empire Development,” “A Living Wage,” “A National Policy.” These and a thousand similar cries resound on every side.

Can any of these policies lead the way out? Not for a moment. For if capitalism itself is the cause of the crisis, no policy of patching up capitalism can avail. We are faced with something deeper than an ordinary trade slump; the present crisis is only part of a general crisis of capitalism as a whole; and these policies can only worsen it. We are faced with a world crisis of capitalism. All over the world the powers of production have grown too great for the present system of private ownership and class-society. We can produce more foodstuffs, more raw materials, more manufactured goods, than ever before all over the world. But capitalism cannot absorb them; the foodstuffs and raw materials rot and are burnt, the machinery and plant are idle, because there is no social ownership of production, no social use for what is produced. Capitalism can only fight in ever fiercer competition, drive the workers harder for less pay, restrict production, throw increasing numbers into unemployment, build up competing imperialist systems behind tariff walls, and so lead to ever greater destruction and decay, and to the final explosion of war. Only the working-class can save the situation, can solve the causes of the crisis by wresting production from the fetters of private ownership and profit-making and organise production for social use. The crisis calls aloud for the workers’ socialist revolution as the sole path of constructive advance. This is the supreme issue before us.

For none is this issue more desperately urgent than for the workers in Britain. For the whole economic structure of capitalism in Britain, on which the population at present depends for life, is now breaking up. Issues of life and death, whose extent is still hardly guessed at, are in front.

Face the facts. In every market in the world British trade is going down year by year. American capitalism, German capitalism, new capitalist powers beyond Europe, advance. But these, too, are faced with crisis. The power of production grows every year; the workers cannot buy; the markets are choked. Competition grows fiercer. This situation led already to the war of 1914. To-day it threatens a yet more terrible world war — all the more desperately and urgently because capitalism in decline is to-day faced with the triumphant advance of socialism in the Soviet Union and prepares for war as the sole solution. On a world scale, each crisis gives place only to a greater crisis. There is no way out of this succession within capitalism.

The hold on the Empire, on one quarter of the world, by British capitalism helped in the past to hide the decline for a while, to give new sources of profit and tribute. But to-day this hold is breaking down. The Dominions move away on their own capitalist development. The Colonies revolt. India is fighting its way to freedom. Once this hold is lost, what is the future for British Capitalism? How shall the forty-five millions in these islands live?

There is no future on the basis of capitalism in Britain. Unless we overthrow capitalism, not only decline, but final collapse and starvation await us.

As the crisis grows and takes new forms, as policy after policy is desperately tried by capitalism and thrown aside in failure, as new political forms rise and fall with ever greater rapidity in the gathering vortex, as the struggles of the workers and capitalism deepen and gather on a thousand issues, wider and wider masses are awakening to the inevitable fight, and louder and louder sounds the trumpet call to the Socialist Revolution.

Capitalism or Socialism in Britain — capitalist collapse or the Workers’ Revolution — this is no longer a debating issue of the future, it is a life and death issue; a fight for life that draws close.

Workers of England, Scotland and Wales! Awaken before it is too late! The future is in our hands. We shall overthrow capitalism. We shall build the Workers’ Republic.

This pamphlet is written for every serious worker who wishes to face the issues, to understand what is happening, to judge what must be done.


March, 1931.



“REVOLUTION in Britain is not practical politics.” The “common sense of the British workingman” is proof against “wild notions of social revolution,” and prefers the path of “peaceful progress” and “practical advance.” How often have we not heard this preached from every capitalist platform and press?

What are the facts? The facts are that a stage has been reached in Britain in which there is not any longer the possibility of “peaceful progress,” in which the workers’ socialist revolution is the only “practical” politics, not a “wild notion,” but the sole constructive path forward from the present decay, and if this line is not taken, starvation and ruin, of which the present crisis is only a beginning and foretaste, faces the population of these islands.


Everyone sees the decline in Britain to-day. The present crisis forces it to the forefront of all questions. With an increasing population, with ever-greater productive power, production is below pre-war. Once the foremost trading and industrial nation of world capitalism, to-day Britain has fallen to third place in world exports, and its exports are only two-thirds of the pre-war volume. The percentage of world trade shrinks. An enormous and rising excess of imports reveals the growing parasitism. The hold on the Empire weakens. The consequences of this decline are visited on the workers. Millions seek employment in vain, and have to struggle to exist on a grudged and bare subsistence rate — the effect of which is equivalent to a gigantic cut in the wage of the whole working-class. The wages of the other workers who are still able to keep their jobs are cut and cut again; exploitation is intensified. With poverty and need all round, with the most highly developed machinery for production at hand, with world production of raw materials and foodstuffs abounding, with millions of workers waiting and skilled to work, the machines and plant stand idle; and the capitalists even form companies to buy them up and destroy them in order to restrict production. This is the pass to which capitalism has brought Britain.

Why is this decline? It is the inevitable outcome of capitalism in Britain. So long as capitalist industry was developing in Britain alone, it could have a clear field throughout the world. So soon as capitalist industry inevitably began to develop in other countries all over the world, the position of British capitalism is more and more weakened. From the outset Marxism foretold this iiecefary outcome. As far back as 1845 Engels prophesied this future decline of British capitalism, so soon as capitalist industry should develop in other countries, especially America and Germany, and showed that just this decline would place the issue of revolution sharply before the workers. He wrote:

“Should English manufactures be thus vanquished, the majority of the proletariat must become forever superfluous, and has no other choice than to starve or to rebel.” (Engels: “Condition of the English Working Class in 1844.”)

To-day we are beginning to learn the truth of this, when two million workers are finding themselves thus “superfluous” for ten years already, when the standards of all the workers go steadily down, when the mass struggles for bread against capitalist profits grow daily more intense.

The old basis of British capitalist prosperity is gone for ever. The former world monopoly of British capitalism is ended. In the nineteenth century, British industrial capitalism developed ahead of other countries and dominated the world. British manufactures found markets everywhere; raw materials and foodstuffs flowed into the country in exchange. Expansion seemed unlimited. The British capitalist class took no thought for the future; with eyes only for the immediate plunder beyond the dreams of avarice to be made by the spoliation of the world, they plunged into the gamble. They built up recklessly and without plan the whole economic organisation into a top-heavy industrial structure as the permanent workshop of the world; they destroyed agriculture; they transformed the whole nation into a factory proletariat to turn out their profits. They assumed all this would last for ever.

To-day the gamble is ended. New capitalist powers have arisen on every side. The fight for the spoils of the world between the rival imperialist groups grows ever more intense. This fight led to the world war of 1914-18. But the war only intensified the crisis. It hastened the British decline: it hastened the growth of new capitalist forces all over the world. It carried forward the old antagonisms in the new forms of victors and vanquished; it added new and more intense ones — America and Britain in place of Germany and Britain — leading towards new world-war, which again draws visibly close.

Above all, the war began the period of the world revolution-the rising struggle of the working masses to end the rule of dying capitalism and bring in the new order of socialism. Over one-sixth of the earth the workers’ revolution conquered, and to-day advances to socialism. The colonial peoples, in China and India, constituting one-half of the human race, rise to free themselves from the imperialist yoke. The workers in Europe and America advance in growing mass struggles. The hour of capitalism reaches its end.

This is the situation in which the decline in Britain takes place to-day, and from which capitalism can find no solution. British capitalism in decline is faced with the pressure of the younger and stronger American capitalism on one side, with the advance of the socialist revolution over one-sixth of the earth on the other, with the gathering, struggle of the colonial peoples for freedom, with the gathering struggle of the workers at home.

There is no going backwards — from the present ruin to the dead capitalist past. There is only going forward to the socialist future in Britain and the world.


This decline and growing collapse of British capitalism brings the workers’ struggle to a new stage.

In the old days, in the nineteenth century, the workers in Britain were still able to win a small measure of advance within capitalism. The advance was small and wretched; it reached in the main only one upper section; it was far less than the growth in production. The share of the workers in the total wealth went steadily down even in the “progressive” Victorian period (“the proportion of the total income which goes to wages is less now than it was fifty years ago” (Sidney Webb to the Royal Commission on Labour, 1892). But the world expansion of British capitalism was so great that there were scraps for the workers to win.

This was the basis of the old Labour movement, of the old ideas of “peaceful progress,” of the old reformist Labourism and trade unionism, which sought to win advances for the workers within capitalism.

To-day all this is ended. Since 1900 the real wages of the workers have gone down. Between 1900 and 1925 the Labour Research Department has estimated that the real wages of the working-class fell 20 per cent. In the last few years this fall has been headlong.

In the period of decline the gulf between the capitalist class and the working-class grows ever greater.

Capitalism maintains its profits; no longer on a basis of growing world expansion, in which a share may fall to the workers, but solely on the basis of lowering and worsening the standards of the workers.

In the midst of the decline and stagnation, the fortunes and incomes of the capitalist class have actually risen. Super-tax incomes (over £2,000 a year) have risen from £504 millions in 1920-1 to £541 millions in 1929-30. Fortunes left at death, subject to estate duty, have risen from £391 millions: in 1920-1 to £511 millions in 1927-28. The “Bankers’ Magazine” index of the value of Stock Exchange securities has risen from 100 at the end of 1921 to 118 at the end of 1930.

In the same period, between 1921 and 1930, the wages of the workers have fallen, as recorded in the Ministry of Labour figures, by a net decrease of £550 millions a year.

How has this been possible? Because in the period of decline the conditions of the workers go down with the industry; the old trade union methods of bargaining, on the basis of the state of trade, are no longer effective; but the proportion of the parasitic capitalist charges on industry grows ever greater.

The parasitic burdens of capitalism grow ever greater.

The War Debt of £7,000 millions draws £350 millions a year to the pockets of the wealthy, or more than the total of the “social services.” Owing to the fall in prices, the real burden of the War Debt has doubled since 1920. But the War Debt is only one of a host of such parasitic burdens to-day strangling production in Britain. Every industry is loaded down with a crushing weight of inflated capital, bonds, debentures, mortgages, bank overdrafts and the rest, on all of which interest has to be raised in the midst of the industrial decline by the only means possible, at the expense of the workers’ share. Here are the real “high costs of production” which load down British industry, and can only be removed by the removal of the capitalist parasites.

The total “rentier” capital fixed charges (i.e., debt services, rent and interest) in Britain have been estimated by the leading capitalist economist, Sir Henry Strakosch, at £1,070 millions a year, or 26 per cent. of the estimated national income. Add to this his estimate of profits of capital at £685 millions a year, and we reach a total of £1,755 millions a year or 43 per cent of the national income for the capitalist leeches — actually as much as the total wages of the working-class overwhelming majority of the nation. It is not surprising that, to maintain these colossal charges in industrial decline, “the wages of all workers must come down,” as every capitalist insists.

But it is not only from the workers in Britain that the capitalists maintain their enormous incomes in the midst of decline. It is also from the workers and peasants under the exploitation of British capitalism all over the world.

The parasitic overseas tribute of British capitalism grows ever greater.

The British capitalists have invested a large portion of their accumulated profits, wrung from the British workers, in world exploitation. To-day they draw an increasing proportion of their income from this source of passive tribute, while increasingly neglecting production and industry in Britain. At the beginning of the century the total income of the British capitalists from foreign investments was estimated at £100 millions, as against £18 millions for the revenue from all foreign and colonial trade. But to-day the Board of Trade estimates the total income from foreign investments at £285 millions, or, together with interest on short loans abroad and commissions, at £365 millions — nearly four times as much in thirty years.

This imperialist tribute shows itself in the excess of imports over exports. In 1930, imports to the value of £958 millions were retained in Britain. Exports totalled £570 millions. Thus over two-fifths of imports were not paid for by goods. This is a picture of a decadent centre of an empire in the last stages of decline before the final collapse.

As parasitism grows, the basic productive industries go down; only the parasitic luxury industries increase.

The basic industries, the real sources of wealth and essential to life, and employing the most workers, go steadily downwards, crushed under the weight of capitalist bloodsucking charges. Only the parasitic luxury industries, catering mainly for the capitalists and their servants, prosper and grow in a short artificial blooming. Coal, iron, steel, engineering, shipbuilding, cotton, wool, railways — all show decreases in the numbers employed. But increases are shown by hotels, restaurants, shops, stores, artificial silk, motor-cars, personal service, commerce, finance.

This is the living picture of decay and extreme social disease in its most foul form — the inevitable reflection of growing wealth and growing poverty — which only the workers’ revolution can end. On these lines, even if British capitalism were able to continue upon the basis of its growing overseas slave tribute, it would only be able to offer the British working-class the prospect for half their numbers to be exterminated by unemployment and slow starvation as “superfluous,” and for the remainder to be taken on as footmen and purveyors of knick-knacks to the idle bondholders. But this outcome will never be reached. The colonial slaves will rise and end the tribute. The British workers will rise and end the decay and degradation, and establish a new productive industry to meet human needs.

This position cannot last. The battle between the workers’ needs and capitalism grows ever fiercer. It can only end in revolution.

The colonial workers and peasants are already in open revolt. The hold on the Empire, economic and political, weakens year by year; all the efforts of the Empire-mongers cannot reverse this process of disruption. The overseas tribute will collapse. When it collapses, the fight will become a final bare fight for life between the British workers and British capitalism.

But already the British workers are faced with growing struggles. The attacks of capitalism, to maintain its profits, grow ever more sweeping and ferocious, ranging over every field, against both employed and unemployed workers, against wages and social services, for new forms of intensified labour and cut rates, for tariffs to raise prices, for new political forms beyond Parliament to drive down the workers. But the struggle of the workers is rising against them. The old Labour leaders, the former reformists, now turned policemen of capitalism in the Labour Government, can no longer hold the workers back. The mass struggle advances inevitably to revolutionary issues.

The basis of Reformism is ended. The only path before the British workers is Revolution.


Do not imagine that the crisis is only a crisis of “British industry,” to be solved by some form of reorganisation within capitalism which would “restore British competitive efficiency.”

All the capitalist spokesmen, Conservative, Liberal and Labour, speak of “reorganisation,” of new policies of this, that and the other (but never touching rent, interest and profits), to “save British industry.” They appeal to the workers to make “sacrifices” to help in this. They imagine that if only British capitalist organisation and technique could be modernised and improved, if rationalisation could be introduced, or tariffs, or the like, all would be well.

But all these so-called remedies not only fail to touch the root or the evil — the burdens of capitalist disorganisation and parasitism, and the gulf between growing productive power and mass impoverishment. They can only intensify the disease. For just the most advanced capitalist countries, like America and Germany, with the highest tariffs, with the highest rationalisation, are now plunged in the most intense crisis. Germany had at the beginning of 1931 five million unemployed, America (according to the British Prime Minister’s estimate) twelve millions. If rationalisation and tariffs have not availed America and Germany, why should they avail Britain?

It is not a peculiar crisis of British capitalism, it is a crisis of world capitalism.

The capitalists, faced with increased productive power and a shrinking market, can only look for the solution in fiercer competition, in restricting production, in cheapening their own costs of production, in cutting wages against their competitors, in increasing their own competitive power, in fighting to enlarge their own share of the market. But these measures are pursued by the capitalists in every country. Although one set or another set may gain a temporary advantage for a short time, the net effect can only be to deepen the crisis. The net effect of every advance of technique, of every wage-cut, of every cheapening of costs and intensification of production, is to intensify the world crisis.

All over the capitalist world productive power has increased far faster than population — but capitalist monopoly holds it in fetters, and the outcome is crisis.

Note well. The crisis is not a crisis of natural scarcity or shortage. Harvests are abundant. Foodstuffs are rotting in the warehouses, or are being burnt. Stocks of goods of all kinds are piled up, unsold. Millions of workers are willing and able to work; but existing society has no use for their labour. The crisis is a crisis of capitalism alone.

The power of producing wealth is greater than ever. It has grown far more rapidly than population, thus disproving all the lies of those who talk of “over-population” as the cause of the crisis. Although capitalism does not use more than a portion of modern productive power, although it wastes most and deliberately cuts down and restricts production in order to increase profits, actual production has grown much faster than population. Here are the official figures of the League of Nations Economic Section: —

Between 1913 and 1928 the population of the world grew by 10 per cent. In the same period world production of foodstuffs increased 16 per cent. World production of raw materials increased 40 percent. The increase in manufactures and manufacturing power is still greater and beyond easy measurement. In the three years alone between 1925 and 1928 the production of the iron, steel, engineering, shipbuilding, motor and electrical industries increased 25 per cent. Between 1924 and 1930, according to the Second World Power Conference, the electrical power output of the world doubled.

More foodstuffs. More raw materials. More manufactures. More power. All increasing beyond the rate of increase of population. And the outcome? It would seem natural that the outcome should be greater abundance for all. But what is the result to-day under capitalism? The result is world crisis, stagnation and closing down of production, mass unemployment, mass impoverishment, lowering of standards.

Why? Because capitalist monopoly cannot organise production for use; because the growing discord between ever-greater capitalist accumulation of wealth on one side and growing mass impoverishment on the other, makes impossible the use of more than a diminishing proportion of the rising productive power. Every advance of production only intensifies the crisis, intensifies the ferocity of capitalist competition for the market.

Alongside the growth of productive power the impoverishment of the masses has grown throughout the world.

The burdens of capitalism, as its volume grows yearly larger by accumulation, grow ever heavier. The standards of the workers and peasants throughout the world are steadily forced down to meet these burdens. Consumption goes down. In India the consumption of cotton cloth has fallen from 16 yards per head before the war to 14 yards to-day. In Britain wheat imports have fallen from 117 million hundredweight in 1924 to 111 millions in 1929; beef imports from 13.6 millions in 1824 to 12.6 millions in 1929 — less bread and less meat for a larger population.

Many would-be reformers of capitalism (including the Labour Party propagandists and the Independent Labour Party) urge that if only the capitalists would pay higher wages to the workers, enabling them to buy more of what they produce, there would be no crisis. This is utopian nonsense, which ignores the inevitable laws of capitalism — the drive for profits, and the drive of competition. The drive of capitalism is always to increase its profits by every possible means, to increase its surplus, not to decrease it. Individual capitalists may talk of the “gospel of high wages” in the hope of securing a larger market for their goods. But the actual drive of capitalism as a whole is the opposite. The force of competition compels every capitalist to cheapen costs of production, to extract more output per worker for less return, to cut wages. Just in America, where the “gospel of high wages” was most talked of to conceal the real process of capitalism at work (intensified output from the workers, with a diminishing share to the workers), the resulting crisis has led to wholesale wage-cuts in every industry.

Capitalism is bankrupt even to explain the crisis, still less to find a solution for it.

All the leaders of capitalism, economists, financiers, politicians, are at sixes and sevens. They find it a “strange paradox” that increased production of every form of material wealth should lead to universal crisis, poverty and unemployment. Listen to Churchill:

“The root problem of modern world economics was the strange discordance between the consuming and the producing power. Who would have thought that cheap and abundant supplies of all the basic commodities should find the science and civilisation of the world unable to utilise them? Had all our triumphs of research and organisation bequeathed us only a new punishment “the curse of plenty?” (Churchill: Romanes Lecture, 1930.)

“The curse of plenty.” “Strange discordance.” “A new purusnment.” But has he any answer? He has none. Listen again to the Times Washington correspondent on the present situation of America — America that but a short time ago was held up to the workers by all the capitalist and Labour Party and Independent Labour Party — propagandists as the model for the working-class, the eldorado, the paradise of the workers, the triumphant object-lesson of successful, scientific capitalism, the disproof of Marxism. To-day the Times writes of America under the headings “Lost Prosperity. Disappointed Hopes”:

“‘Given a chance to go forward with the policies of the last eight years,’ said the future President, ‘we shall soon, with the help of God, be in sight of the day when poverty will be banished from this nation.’ The phrase is being used to bedevil him now. For one critic the month of September, 1903, is ‘the Sixth Month of the Second Year of the Abolition of Poverty’; and there are voices crying out to know how a country can produce so much food that people starve, and so many manufactured goods that people go without? The question has not yet been answered.”

“There are voices crying out to know how a country can produce so much food that people starve, and so many manufactured goods that people go without.” That question is not a question only for America. It is a question for the whole capitalist world. And capitalism cannot answer it.

Capitalism has no solution. The most the capitalists can see is to wait amid the general misery until the universal stagnation, destruction and stoppage of production has produced such a vacuum that a feeble “demand” will again arise, beginning a new trade cycle, and leading to a new and greater crisis. But of any attempt to organise the growing productive power to meet human needs — the question does not even enter into their heads; it cannot arise within the conditions of capitalism.

Capitalism has no solution. Only the working-class, only socialism can bring the solution.


Only Socialism can bring the solution. Only Socialism can cut through the bonds of capitalist property rights and organise production to meet human needs. Once capitalism is overthrown, then and only then can production be organised in common for all, and every increase in production bring increasing abundance and leisure for all.

This is the aim of the working-class revolution. Only the organised working-class can fight and destroy the power of the capitalist class, care drive the capitalists from possession, can organise social production.

Against capitalism, with its rotting decline and ruin, the working-class stands forward in struggle as the social force of the future, the leader of the exploited masses throughout the world to the future free and equal society.

Of this final solution of the crises and miseries of capitalism, Engels wrote in 1891, in words that are closer than ever to the present crisis:

“But these inventions and discoveries, which supersede each other at an ever-increasing pace, this productiveness of human labour, which increases day by day at a hitherto unheard of rate, finally creates a conflict, in which the present capitalist system must fall to pieces. On the one side, immeasurable wealth and a surplus of products which the purchasers cannot control. On the other, the great mass of society proletarised, turned into wage workers, and just on that account become incapable of taking possession of that surplus of products. The division of society into a small over-rich class and a large propertyless working-class, causes this society to suffocate in its own surplus, while the great mass of its members is scarcely, or, indeed, not at all, protected from extreme want. Such a condition of things becomes daily more absurd and unnecessary. It can be abolished; it must be abolished. A new social order is possible, wherein the class differences of to-day will have disappeared, and wherein — perhaps, after a short transitional period, of materially rather straitened circumstances, maybe, but morally of great value-through the systematic use and development of the enormous productive forces already in existence (with equal obligation upon all to work), the means of life, of enjoying life, and of developing all the physical and mental capabilities, will be at the equal disposal of all in ever-increasing fullness.” (Engels: Introduction to Marx “Wage-Labour and Capital,” 1891.)

When Marx and Engels wrote in the nineteenth century, this was still theory of the future. To-day we are living to take part in the actual change.

The theory of the future has become the practice of the present. The working-class has already won power over one-sixth of the earth, in the. Soviet Republic, and is building up socialism. The triumph of socialism is already practically demonstrated.

The Union of Soviet Socialist Republics represents the vanguard of the international working-class in the fight for socialism. What is happening in the Soviet Union is not a question of a “foreign” country; it is a question of the central battle-ground between capitalism and the working-class. The international working-class has made its first breach in the front of capitalism at its weakest point, in the territory of the former Russian Empire; since 1917 the workers hold that breach victoriously and now begin to build up socialism. The Union of Soviet Socialist Republics is the kernel of the future World Socialist Republic. The struggle that goes on there is our struggle. The triumphs are not more triumphs of a particular “experiment” in a particular country; they are the triumphs of the world working-class in the battle against capitalism. Only on this basis can we understand aright the world significance of what is happening there.

The world to-day is divided into two unequal halves — the capitalist world, at present occupying five-sixths of the earth, and the socialist world, so far occupying one-sixth.

Observe now the difference between these two worlds.

In the capitalist world production is stagnant or even declining. In the third quarter of 1930 industrial production of the United States was 23.5 per cent. below the previous year; in Germany 20.4 per cent. below; in Britain — where the level was already low — 9.9 per cent. below (Government White Paper on Unemployment, December, 1930). Capitalism is unable to use more than a portion of even the existing machinery of production.

In the socialist world production is ascending at a rate unparalleled in history. The pre-war levels of production in Russia are already long left behind. Between 1924 and 1929 industrial production trebled. The Five Year Plan, running from 1928 to 1933, provides for an expansion of 136 per cent. in industry, and 55 per cent. in agricultural output; reaching to a level three to four times above pre-war. This Plan, now in its third year, is already being more than realised, so that it is expected to complete it in four years. 1928-29 showed an advance in industrial output of 23 per cent., 1929-30 an advance of 25 per cent. And this year, 1931, is budgeted to realise an advance of 45 per cent. This is the picture of the socialist world at the same time as the whole capitalist world is in crisis and decline.

In the capitalist world there is mass unemployment, reaching to a total of 25 to 30 million workers. The absolute total of productive industrial workers begins to go down. The problem of the capitalist statesmen in every country becomes how to deal with the “superfluous” workers.

In the socialist world unemployment has disappeared. The total of industrial workers grows rapidly. The problem for the rising socialist production becomes to find enough workers for the work to be done.

In the capitalist world the standards of the workers go steadily down. Real wages fall. Social services tare cut. Hours and conditions of labour are worsened.

In the socialist world the standards of the workers are rising year by year. The Five Year Plan provides for a rise in real wages of 71 per cent., and an expansion of social services by 70 per cent. At the same time the seven-hour day and five-day week is becoming universal; already half the workers have the seven-hour day, and by the end of this year, 1931, 92 per cent. of the workers will be on the seven-hour day.

Why is this difference? What is its meaning for us? All the odds were, to begin with, against the socialist world, which inherited one of the most backward countries, technically undeveloped, and destroyed by the ravages of war and civil war, and has had to advance, first against the armed intervention, and then against the boycott, of the capitalist world. All the odds appeared in favour of the capitalist world, with its immense resources, high technique and apparatus, trained population of skilled workers, and centuries of experience. Yet socialism rises; capitalism goes down. The lesson is plain to all.

What is the secret? The workers in Russia drove out the capitalists and landlords, and smashed their State power. They set up their own power, the workers’ rule, and took over the land and the factories. This act of social revolution gave them the possibility to begin changing conditions, to organise social production.

What are the consequences that follow now from this conquest of power?

First, all the means of production, the factories, mines, land, railways, docks, ships, are the property of the workers. The capitalist and landlord parasites are no longer there to levy tribute. The product of abour belongs to the workers. The workers are free to organise production.

Second, all production is organised according to a single plan. There is no longer the capitalist anarchy of production by competing businesses for an unknown market, with the consequent gluts and slumps. Instead, the workers’ organs are able to determine: We shall produce so much coal, so much iron, so much steel, so much agricultural machinery, so much textiles, cultivate so much land with such and such crops, etc., — all as part of a single plan.

Third, all production is directed solely to supplying the workers’ needs. It is for use, not for profit. Therefore every expansion of production means greater abundance and leisure for all.

Fourth, the workers, because it is their own production, for themselves, are able to carry forward production with an initiative and enthusiasm unattainable in capitalist countries, maintaining discipline through their own elected workers’ committee in the factories, controlling production and administration through their own elected organs, and led by their own revolutionary party, the Communist Party.

These are the secrets of socialist production, by which we shall equally solve the decline and crisis in Britain and throughout the world.

The capitalists know already the success of socialism and are preparing accordingly. A few years ago they spoke only of “ruin” in Russia and the “failure” of socialism. To-day they have changed their tune, and speak of the “menace” of the mighty socialist productive machine flooding the world with cheap goods with which they cannot compete. On this basis they are preparing war to smash the socialist State as their sole solution. This is the final “solution” of the crisis for capitalism. Against this war the workers of the world must be prepared, to make sure that, if it comes, it shall end, not with the downfall of socialism, but with the downfall of capitalism.


What is the outlook if we do not overthrow capitalism, if we do not hasten to realise the workers’ socialist revolution in Britain also?

Capitalism has no policy to solve the decline and growing crisis. Within the conditions of capitalist anarchy there is no harmonious solution possible, but only the blind drive to ever more violent explosion. Capitalism can only seek to prolong its life by throwing the burdens of the crisis on to the workers, by ever renewed attacks upon the workersupon the workers’ standards at home, upon the colonial workers, upon the Workers’ Socialist State.

Worsening conditions and desperate struggles, new and deeper forms of crisis in Britain and the world, the final outbreak of war as the last “remedy” — this is the outlook if we delay to overthrow capitalism.

We have seen that in the face of the crisis the immediate policy of the rival groups of capitalists is to fight to increase their own competitive power, to cheapen costs of production, to fight to enlarge their own share of the diminishing market. But this cheapening of costs, since capitalist rent, interest and profits are sacred, can only be carried out at the expense of the workers. So develops the new capitalist offensive which sweeps through the capitalist world in the wake of the crisis.

MacDonald in England, Hoover in America, Brüning in Germany, Scullin in Australia — all have the same task; to cut down rigidly the standards of the workers at home, to carry through an aggressive trade offensive for the capture of markets abroad.

Wages are attacked on every side. Railwaymen, miners, engineers, cotton workers, wool workers, builders, all are attacked with sweeping demands for cuts.

Conditions of labour are intensified. Heavier output is demanded from every worker for less return. Speeding up and rationalisation are the order of the day, leading directly to increased unemployment, to weakened health and physique, to an ever-rising rate of industrial accidents.

But the offensive sweeps wider than wages, hours and conditions. It extends to the unemployed, no less than the employed workers; it extends equally to all the social services. The Unemployment Insurance Commission prepares the attack on the unemployed workers; the 17/- a week of the unemployed worker, the 15 /- a week of the unemployed woman worker must be cut down, or fully cut off from many, in order that rich lords and ladies may enjoy their tens and hundreds of thousands of pounds a year. All the social services — the bare and starveling expenditure on health, education, etc., grudgingly admitted by capitalism for the maintenance of its labour force — are now attacked by capitalism in its present reckless stage as an “extravagance” to be cut down. It is typical of the present stage of capitalism that less than £40 millions a year for the health of the whole nation, or £50 millions to help to keep barely alive two-and-a-half million unemployed workers (for whose unemployment capitalist industry is itself responsible) are considered an “extravagance”, while £350 millions a year are unquestioned on the war debt, and £550 millions a year to 90,000 super tax parasites are not considered an “extravagance.” But this is the very heart of the “crisis,” which no capitalist policy, Conservative, Liberal or Labour can change, but only the working-class revolution can cut through.

At the same time new forms of policy are prepared, of tariffs and empire policies, to intensify the exploitation of the workers. The purpose of tariffs is described as to “protect” home industry, and thus secure more employment and better conditions for the workers. This is lying deception. The enemies against which home industry needs to be “protected” are the bloodsucking leeches of capitalist exploitation, who make better conditions for the workers impossible. But the purpose of tariffs in modern capitalism is to secure a guaranteed closed area for exploitation by high prices, in order on this basis to compete more successfully on the world market with cheaper prices. And the effect of tariffs for the workers by raising prices is equivalent to an all-round cut in wages. In the same way the empire policies, speciously spoken of as “empire free trade,” “empire unity,” etc., are aimed to extend this guaranteed closed area of exploitation to the maximum possible, and maintain it fenced-in against rival exploiters.

All these measures require intensified suppression of the workers’ struggle. So we see such measures as the Trade Union Bill, following up the Baldwin Trade Union Act, to make more and more strikes illegal; the increasing use of the police and the courts against the workers in every strike; the drawing in of the official trade union machine into close co-operation with the employers and the State to break strikes, etc. The forms of parliamentary democracy weaken; the capitalist parties — Conservative, Liberal and Labour — all draw closer together; the parliamentary farce becomes unreal. The politics of capitalism, in Britain and in other countries move increasingly to forms of “fascism,” i.e., forms in which the capitalist dictatorship throws off the mask of parliamentary democracy and establishes an open dictatorship upon a basis of violence, corruption and demagogy, directed against the workers’ struggle. The fascist dictatorship is the final political expression of capitalism in decline, once the parliamentary humbug begins to fail to hold in the workers. Signs of tendencies towards it are already visible in British politics. (Churchill, Beaverbrook, Rothermere, Mosley, etc.).

Fascism does not appear merely in the guise of open violence and the overthrow of parliamentary forms. If this were all it could be the more easily overcome by mass opposition; it would be the less dangerous. Fascism appears, especially at the outset, as an appeal for a bold policy of social, reform and national development, an appeal to broad masses of the population, to all discontented workers, to middle class elements, to youth, to idealism, to patriotism, to the desire for drastic change, and under all these covers, even imitating semi-socialist and revolutionary language, it conceals its real aim of drawing the working masses aside from the true objective of the overthrow of capitalism and establishment of socialism, in order to chain them the more securely to capitalism. Just this type of propaganda makes fascism dangerous, makes it necessary for the workers to be ceaselessly on their guard against it in the present period.

But in the end where will all these policies of capitalism lead? They will not solve the crisis. On the contrary, the more they increase the impoverishment of the workers, the more they increase competitive power, the more they intensify the crisis. The same types of policy are pursued by all the capitalist powers. The final effect is only to sharpen world competition to breaking point. But the breaking point in in fact war. The economic-political struggle of the modern imperialist powers passes rapidly to armed struggle. And this is the outcome to which capitalism drives. Armaments are already piling up to heights never before equalled. The antagonisms of the imperialist powers are more intense to-day than before 1914. But even more intense is the antagonism of all the imperialist powers to socialism, to the new Workers’ Republic. This is, above all, the direction in which war threatens. War appears increasingly to capitalism as the only solution, as the necessary condition to smash socialism, as the immediate outlet for the unused productive power which is creating the crisis, as the means to the conquest of a new market and area of exploitation giving a new lease of life. In one form or another, the whole drive of the forces of the capitalist crisis is to war.

Fascist dictatorship and war — this is the outlook if we fail to overthrow capitalism. This is the actual alternative to the workers’ revolution. This is the outlook to bear in mind when the Labour propagandists speak of “peaceful” alternatives to revolution.

And even these will not solve the crisis of capitalism in the end. They will only make the more urgent, the more insistently necessary the workers’ revolution.


Many workers placed their hopes in the Labour Party to bring the solution. They have seen the need of basic social change; the Labour Party spoke of basic social change, of socialism, and promised to realise it by easy peaceful means through Parliament. At the last elections, two years ago, eight million workers voted for the Labour Party. Since then, a Labour Government has been installed, and swift disillusionment has followed. The condition of the workers has grown worse; there is no sign of the advance to socialism; the Labour Government has acted as a representative of capitalism against the workers. In the subsequent by-elections one-fourth of the workers who voted for the Labour Party have abstained; discontent is widespread.

Why is this? The “failure” of the Labour Party (“failure” from the standpoint of the workers; from the standpoint of the capitalists it has served its purpose) is not an accident, not a personal question of this or that particular leader, of this or that particular policy. It is a whole system of politics — the whole system of politics of the supposed “alternative” to revolution — that stands exposed in the record of the Labour Government. To understand the role of the Labour Party aright — this is the first necessity for the workers to advance to real working-class politics, to the workers’ revolution, to socialism.

The Labour Party could not act and cannot act otherwise than it has acted, does act and will continue to act, as the representative of capitalism — because its basis is capitalism. How so? Do they not profess the aim of socialism? Yes, they profess the aim of socialism as an ideal for the future. But at the same time as they profess the aim of socialism, they attack the necessity of the workers’ revolution, which alone can realise socialism, they expel from their ranks the militant workers who fight for the workers’ revolution. They profess to hope to reach their aim without the necessity of fighting and overthrowing capitalism, on a basis of co-operation with capitalism, on a basis of winning for the workers gradual gains within capitalism. Therefore their practice is based on capitalism, on acceptance of the capitalist State (or, as they term it, parliamentary democracy), on administering capitalism and helping to build up capitalism. This they term the “practical” policy for the workers.

What is the outcome of this policy? As we have seen, in the period of flourishing capitalism, reformism was able to win small gains for the workers, and on this basis to hold them from the socialist revolution, to hold the workers to capitalism. But this basis is ended. Capitalism to-day is no longer willing to grant concessions to the workers, on the contrary finds itself compelled to withdraw existing concessions, to make new attacks, to worsen conditions. And therefore the role of reformism, which is the servant of capitalism in the working-class, changes. The role of reformism inevitably becomes to assist capitalism to attack the workers, to enforce wage-cuts, to repress the workers’ revolt, to worsen conditions — all in the name of “practical” policy. This has been the role of Mondism and of the Labour Government.

Reformism in the period of extreme capitalist decline inevitably becomes social-fascism — i.e., the leadership and policy within the working-class which reflects the politics of the extreme capitalist decline, which seeks by every means to crush the workers’ revolt, to bind the workers’ organisations to capitalism and to the capitalist state, to enforce worsened conditions on the workers in order to save capitalism. This has been the role of the Labour Government, alike in its bloody crushing of the Indian struggle for freedom, in its hundreds of prosecutions of strikers in Britain, in its enforcement of wage-cuts by arbitration, in its appointment of the Unemployment Insurance Commission with instructions to prepare cuts in unemployment benefit.

Millions of workers are turning from the Labour Party and seeking a new direction. Where shall they turn? The only path forward is the path of struggle against capitalism, the path that leads to the social revolution, to socialism.

Beware of the new forms of Labour reformist or open fascist propaganda that are being prepared and put forward, as the old policy of the Labour Party becomes discredited.

Thus the Independent Labour Party and the so-called “lefts” in the Labour Party hasten to proclaim their “opposition” to the Labour Party policy, to prepare even possibly their formal “separation” from the Labour Party, and to advocate so-called “socialist” alternatives. But on examination their policy will be found to be only the old policy of the Labour Party dressed up in new clothes. Although they speak roundly of “socialism” against “capitalism,” they do not propose the overthrow of capitalism, the working-class conquest of power, the expropriation of the capitalists; their basis is still the same basis of capitalism, of capitalist democracy, of the capitalist State, as with the Labour Party; and therefore the outcome can only be the same. Their only proposals are for the reorganisation of capitalism by a system of State control boards, by which they promise a minimum wage for the workers, at the same time as higher profits for the capitalists. But in fact, capitalist reorganisation in the present period of decline can only, if the capitalist burdens are maintained, be at the expense of the workers. And this is the practical effect of the Independent Labour Party’s propaganda. The Independent Labour Party always intervenes in the critical moments of the workers’ struggle, in the miners’ struggle, in the textile workers’ struggle, with its proposals of capitalist reorganisation as an alternative to the workers’ struggle, thus assisting to weaken and break up the front. This is precisely its value to capitalism, to draw the workers from the struggle in the name of phrases of “socialism.”

Similarly, the Mosley group arises from the midst of the Labour Party, and puts forward “new” policies, which are equally a repetition of capitalist policies. The Mosley group draws on the new tariff and empire policies of capitalism, the fascist aims of emergency dictatorship, and combines these with the Independent Labour Party policy of State capitalist reorganisation. The resulting line is openly and aggressively a national-imperialist line. On a basis of tariffs, intensified empire exploitation, State control, and development of the “home market,” capitalist prosperity is to be built up anew in Britain and fenced-in or “insulated” against the world. The question of socialism or the “ownership of industry” is explicitly stated to be placed on one side in this policy. This line is so closely in accord with the present demands of capitalist policy that it is not surprising that it has received open support and approval from almost all leading capitalist quarters. But at the same time it endeavours to make a “left” appeal to the workers, to use revolutionary-sounding phrases about a “drastic,” “vigorous,” policy, “emergency measures,” etc. This combination of a reactionary capitalist policy, with demagogic phrases is the hallmark of fascism. It is clear to every thinking worker that this line of aggressive capitalism and imperialism, so far from offering a solution to the crisis, can only intensify the crisis, can only lead to fiercer world competition, to fascist dictatorship and suppression of the workers, to hastening the advance to war.

All these supposed “alternatives” to the Labour Party line are in fact conscious attempts to draw the workers back, as they become disillusioned with the Labour Party, from advancing beyond the Labour Party to the conscious revolutionary fight.

It is necessary to break with the Labour Party — yes. This is the condition of advance; for the Labour Party has become the chief instrument of capitalism for the enslavement of the workers, and the chief obstacle to the socialist revolution. But it is necessary to break with the Labour Party — not in order to go back to capitalism — but in order to advance to the newstage of struggle against capitalism, to the revolutionary stage; to build up the workers’ revolutionary party, the mass Communist Party, which will lead and organise the socialist revolution.


From all the foregoing one conclusion stands out firm and unshakable: —

Only the workers’ socialist revolution can solve the crisis in Britain.

Within capitalism, the crisis may, at the most favourable, give place to new fluctuations in trade, leading in turn to new and greater crisis; but the decline can only continue and grow greater; the basic crisis continues unchanged, and can only lead to ruin and catastrophe on a scale not yet guessed at. Within capitalism there can be no other outlook; for the causes operating cannot be changed under the conditions of capitalism. Only the workers’ socialist revolution can affect the causes, arrest the decline, and bring in a new era.


Because only the workers’ socialist revolution can break the bonds of capitalism; can cut through the tangle of anarchic private property rights, conflicting interests and disorganisation that fetter the growth of production in Britain to-day; can strike off the crushing burdens of parasitism that are strangling industry; can organise production socially on planned and scientific lines; can reconcile the conflict of productive power and consumption, and thus solve unemployment can end the conflict of classes by the destruction of class distinctions; can replace the disintegrating empire by free productive relations; and can in the final stage end the conflicts of warring imperialism by the organisation of world socialist economy.

That the workers’ socialist revolution is the only path forward from the conditions in Britain to-day — this is necessary to be understood not only by the mass of the workers who constitute nine-tenths of the nation, but also by the best elements of the petit-bourgeoisie, of the salaried and technical workers, of the intelligentsia, by all who are willing to face the facts and are not, tied to the interests of the handful of moneybags.

What is necessary to be done?

The first necessity is the working-class conquest of power. Without power, no change. But what do we mean by “power”? Do we mean simply a change of government? No. What is in question is not simply a change of government on top, but a change of class power; since our purpose, is not simply to carry through one or two legislative measures, but to change the whole class-direction of existing society.

At present the capitalist class rules, whatever the form of government. Whether a monarchy or a republic, whether a parliamentary system or a fascist tyranny is maintained as the most convenient form, whether the ministry consists of Conservatives, Liberals or self-styled “socialists” — the rule of the capitalist class goes on in fact. The capitalists own the means of production; the mass of the nation live at heir mercy, depend on them for the means of life, are in literal fact wage-slaves in their daily lives. The change from a Conservative Government to a Labour Government does not affect this one atom. What is needed is a change in class power.

What is needed is that the working-class shall rule — i.e., that the workers shall drive out the capitalists from possession, defeat their resistance, smash their State machine, and set up their own workers’ rule throughout the country.

What is the form of the workers’ rule? The form of the workers’ rule is through their elected workers’ councils, elected from the factories, from the soldiers and sailors, from the housewives, from the propertyless masses throughout the country, in every town and in every district, and leading up to the central workers’ council, which exercises supreme governing authority on behalf of the working-class. What maintains the unity and drive of working-class policy through these forms? That is realised by the revolutionary party of the working-class, the Communist Party, which must consist of the best and most active workers, in close touch with their fellow workers at every point, and fighting and leading the struggle at every point, both before and after the conquest of power.

This is the new workers’ State we need to realise in order to achieve the transition to socialism. This is the Workers’ Dictatorship which is the supreme aim of our present stage of struggle.

Why dictatorship? Because the resistance of the capitalist class must be crushed. Because the class struggle knows no limits, is a war, in which the capitalist class uses every means at its command. The capitalist class will continue to fight to the last, even after the working class conquest of power. Therefore, so long as the remains of capitalism exist within and without the country, the dictatorship must be maintained. But what appears as dictatorship to the tiny capitalist minority, and the end of their “freedom,” appears as the beginning of freedom to the overwhelming working majority, the first real democracy in which they themselves, no longer hampered by the capitalist tyrants and blood-suckers, take decisions and rule.

Given the Workers’ Dictatorship, let us come now to the immediate measures to be taken.

The first step is the expropriation of the capitalists and taking over by the working-class of all the large-scale means of production — the land, factories, mines, railways, docks, etc., no less than the banks, postal and telegraph system, etc. All claims of large-scale capital, no less than the State Debt, are wiped out without compensation. By this means we can begin the social organisation of production, free from the burdens of parasitism and private ownership.

The second step is the organisation of production on a single plan to meet social needs. Every industry is organised as a single unit under its own Council, with workers’ control at every stage of production. The direction of all is united in the central Council of Industry or Workers’ Economic Council. The Council of Industry plans out the entire production of the country: so much coal, so much textiles, so much iron and steel goods, etc. The output is calculated, according to the given stage of the productive forces, to meet the three purposes: (a) goods to meet the immediate needs of the population; (2) means of production to extend the productive power in the future; (3) goods to exchange with other countries for such amounts of raw materials, foodstuffs and other imports as are necessary. The entire social product thus goes in one of these forms to the workers, whether socially or for individual consumption. The necessary work to be done is spread out over the entire labour force, i.e., the whole able-bodied community, hours being shortened to absorb the labour of all (in place of the capitalist method of overworking some in order to leave the rest unemployed). Necessary adaptations to new forms of work and industrial transference can be rapidly and easily effected, when these no longer involve cutting of rates, loss of skilled status, etc. (as in capitalism compels the justified resistance of the workers), but are carried out with the co-operation of the workers concerned, and without affecting the equal privileges and guaranteed minimum of every worker.

Agriculture will from the outset require special attention and development, since it has been deliberately neglected and crushed down by both capitalism and landlordism, and a great and growing part of the available land, among the best in Europe, allowed to pass out of cultivation. The removal of all the burdens of rent, mortgages, bank loans, farmers’ profits and middlemen’s squeezings, as well as the obstacles of inadequate machinery, game rights and millionaire preserves, ineflilient farming and unsuitable areas; the development of large-scale collective farms with high-power machinery; and the close union of agriculture and industry, breaking down the old division of town and country, of rural and industrial workers, will rapidly build up agriculture in Britain anew, and end the present exaggerated dependence on foreign foodstuffs, which is largely an artificial creation of capitalism (at present, according to Professor Bowley, 40 per cent. of foodstuffs consumed in Britain are home-produced, and 60 per cent. imported; but agricultural experts have shown that, if agriculture were scientifically developed, the home-produced portion could be certainly doubled). This is a question of meeting immediate needs; how far, in the final world organisation of production agricultural and industrial areas will be allocated on a world basis, or, as modern technical development appears to indicate, closely united and integrated throughout the world, is a question of the future.

The third step is the establishment of a Workers’ State Monopoly of Foreign Trade. Here again we are dealing with immediate needs, pending the world victory of socialism, when the old-fashioned forms of inter-country trade will be replaced by the world rationing of production and distribution. During the transition, when a number of capitalist countries will still exist, it is necessary to regulate economic relations with these and prevent economic penetration by capitalism. The Workers’ State will as a single unit exchange its goods for such goods as are desired to be imported. Since all the present capitalist burdens on production will be removed, it will be easy to produce the goods at such a price as will readily find exchange throughout the world, as we shall soon have occasion to see; and indeed we are likely, on these lines, to live to see the remaining capitalist world howling against “British socialist dumping” and “sweated labour,” at the same time as the British workers are enjoying, say, at the outset a £5 a week minimum and the seven-hour day. How this is possible we shall see as soon as we come to consider the social consequences of the changes here outlined, which already lay down the economic foundations towards the new socialist society.


What will be the immediate consequences of the change-over from the present capitalist society to the workers’ socialist society — the fruits of the workers’ revolution and its sacrifices?

It is clear that, economically, we shall have solved the crisis, we shall have ended unemployment, we shall have re-established production on an upward line, we shall have at last directed production to meet the needs of all; politically, we shall have abolished the rule of class distinctions and privilege, and entered on the way to the first real democracy and freedom for all, the free and equal workers’ society.

What will be the social consequences that the workers’ rule will immediately set itself to realise in order to bring the fruits of the revolution to all, in order to end the present reign of inequality — inequality in respect of every elementary human need of food, clothing, shelter, conditions of labour health, education, etc., and bring the material conditions of real freedom and development to all?

Let us begin with a little calculation to give a notion of what is possible, to show, that we are not speaking of some utopia, but only of what is immediately and practically realisable so soon as the workers are united to overthrow capitalism and enforce their will.

Production at present is heavily below productive power. Machinery is one-third idle. The labour of three million workers, or one-fifth of the labour force, is not used at all. The labour of a great part of the remainder is wasted in useless non-productive forms, in parasitic luxury trades and flunkey services for the rich, in redundant “blackcoat” commercial, financial and advertisement-touting work made necessary by private ownership and competition, as well as in wasteful heavy labour which could already be replaced by machinery if human labour-power were not so cheap. Therefore, as soon as production is organised, as full productive power is used, as all are drawn into production, there will be an enormous increase of output. Nevertheless, let us begin on the basis of present output, remembering that in fact the total will be very much higher. We shall have to use existing money-values and estimates of “incomes,” which are in fact of limited practical value and only useful as symbols, not as accurate measures; but they are sufficient indications of the possibilities.

The present total national income from all sources is estimated at £4,160 millions (Bowley and Stamp). From this must be deducted the overseas tribute, which now comes to an end; this brings us to £3,800 millions. We must further deduct what is needed to go to extension of production. At present the amount invested as new capital is estimated at £450 millions a year. Most of this is wasted, going to speculation, financial re-flotation of old companies, foreign gambles, colonial and Indian loans for government terrorism etc.; only a minority goes to industrial productive purposes. If, therefore, we place £500 millions for real extension of production, we are in fact providing for an enormous increase in the rate of growth of production. This leaves £3,300 millions. Now divide this among the forty-five millions of the population, and we see that we have for every family of five the equivalent of £365 or £7 a week. And this only on the present basis of production.

Take it in another way. The present tribute drawn by the capitalist class in the shape of rent, interest and profits is estimated, as we have seen, at £1,755 millions a year. Again deduct from this the overseas tribute and the necessary £500 millions for extension of production, and we have still some £900 millions. Now remember that the capitalists argue that, if only wages could be reduced by 10 per cent. all round, all problems of markets for British goods would in their opinion disappear. Ten per cent. all round off wages would amount to about £180 millions off the costs of production. Is it not obvious, then, that we could, if we chose, take £300 millions off the costs of production, and thus produce our goods at a cheapness to conquer every capitalist market in the world, and yet have £600 millions a year left to raise enormously the condition and standards of all the workers and double at a stroke the expenditure on all social services? Here is the plain, “practical” answer to the “economy” mongers, who preach cuts in wages and social services as the sole condition for the salvation of industry in Britain. And this is, again, only on the present basis of output, and using, for purposes of argument, figures which leave completely concealed the enormous real economies we shall effect by passing from disorganisation to organised production. It is thus evident that, on the most immediate practical basis, and leaving out of account the enormous increase in production which will result from universal socially organised production, the workers’ rule will be able immediately, so soon as the change is achieved, to realise the most enormous advances in standards, hours, conditions of labour and social conditions.

How shall we use this immediate and growing surplus? Part we shall use at once in raising up all round wages, standards and conditions of labour for every worker. Part we shall use in developing rapidly universal and adequate social services, in respect of health, housing, education, cultural facilities, etc. In this way we shall immediately banish poverty, and rapidly prepare the advance to the full communist society in which the wage-basis will finally disappear.

In industry the workers’ rule will establish immediately —

(1) Increased real wages, and a guaranteed minimum for all workers, rapidly rising as production rises;

(2) the seven-hour day, and in mining and dangerous trades the six-hour day, as well as for all young workers the six-hour day;

(3) a fortnight’s holiday with pay for all workers;

(4) workers’ control in the factory; self-discipline through the elected factory committee and workers’ courts; full consultation on all appointments, dismissals, new processes, etc.

Housing, which has grown steadily worse in the conditions of the capitalist decline and since the war, will for the first time be taken in hand as an urgent social need. The class-regime of a superfluity of half-occupied mansions for the handful of the rich, and overcrowding in insanitary hovels for the poor, will be ended. The workers’ dictatorship will mobilise all existing building resources for slum clearance and the building of workers’ houses and cities; will apportion existing housing accommodation according to need, pending the building of the new; will confiscate all the palaces, mansions and country houses of the rich for use as workers’ rest homes, children’s holiday homes, convalescent homes, etc.

A universal Health Service will be the first care of the Worker State. In place of the present system in which doctoring is degraded to a money-making trade dancing attendance on the ailments of the rich, while the poor are put off with a shoddy panel system or nothing at all; in which the voluntary hospitals are eternally clamouring for funds, overcrowded and with long waiting lists of sick needing attention and receiving none; in which sickness and disease come as a terror to the mass of the nation with no possibility of adequate facilities; the medical service under the workers’ rule will be a State service free to all; the Workers’ State will take over all hospitals and sanatoria and rapidly extend them to provide for all needs; universal free health insurance will provide full pay during sickness; special attention will be given to infantile and maternal welfare, the insurance benefit for women workers including eight weeks leave before and after confinement with full pay.

Education will at last be developed on a universal, free, non-class basis, with equal facilities for all. The segregation and snobbery of expensive, inefficient upper-class schools and middle class schools and universities turning out parasites and intellectual slaves, and overworked and under-staffed State schools and subsidised church schools for the workers, inculcating servile capitalist and jingo lies will at last be ended and replaced by a single system of equal schooling on modern lines for all up to the age of 16, with subsequent combination of schooling and industrial training, and a further network of workers’ universities, technical colleges and adult education.

Universal free Social Insurance will, in addition to covering the full health insurance already described, provide for all accidents, and will provide full pensions, equivalent to wages, for all after the age of 60 years.

These measures are only some of the principal social gains of the revolution which can be immediately established in Britain. They are still transitional in character. They are still based in great part on the system of wage-payment and the family household, inherited from the conditions of capitalism. As production rapidly increases, as socialist culture rapidly spreads, the advance beyond the transitional wage and money basis to a full communist basis for all will be rapid.


So far we have considered only the immediate social consequences of the workers’ revolution in Britain. We have now to consider the question of the relation of Workers’ Britain to other countries.

The workers’ revolution in Britain will develop as part of the international workers’ revolution — the international socialist revolution which has already begun in Russia since 1917, and which in the near future is likely to extend throughout Europe and probably the greater part of Asia.

Workers’ Britain will thus have to determine its relations with, probably, a series of socialist countries on the one hand, and with the capitalist countries on the other. With the socialist countries Workers’ Britain will establish immediately complete union and federation, on the model of the already existing Union of Socialist Soviet Republics. This will profoundly affect, and greatly simplify, the problems of economic reorganisation (the equilibrium of food supplies, raw materials and industrial production will be easier in the larger unit). Against the capitalist world, Workers’ Britain will maintain in common with the whole socialist world, full self-defence, while at the same time pursuing the peace policy already adopted by the Soviet Union — the programme of international simultaneous disarmament.

Workers’ Britain will immediately repudiate the secret treaties, the aggressive policies, the unequal treaties, and the military obligations and pacts of British imperialism, including the pact of the League of Nations, which is nothing but a war-pact in peace-clothing.

At the same time, Workers’ Britain will have a problem and responsibility of special importance in relation to the present British Empire. British imperialism rules over one-quarter of the world, or four hundred and fifty millions of people. Of these, forty-five millions are the population of Britain. Under ten millions are in the Dominions, where a subordinate British bourgeoisie has carried through its independent capitalist development, and established a large measure of independence and the workers are carrying on their struggle towards socialism under conditions comparable to those of the British workers. But the remaining close on four hundred millions are the colonial peoples — in India, Egypt, Africa, etc. — subjected to the autocratic despotism of British imperialist rule, crushed down to the most intense exploitation and poverty in the whole world to-day, and held under by armed force and violence.

The full liberation of these imprisoned millions is the first duty of free Workers’ Britain.

The British working-class, so soon as it wins power, will give full and unconditional independence to India, to Egypt, and to all the colonial peoples held under the rule of British imperialism.

Why is it to the interest of the British workers to do this?

The British imperialists, and their followers, of the Labour Party and of the Independent Labour Party, dare to attempt to argue that it is to the “interest” of the British workers to assist to maintain capitalist domination over the colonial peoples. The imperialists argue frankly and brutally that the exploitation of the colonial peoples brings tribute to Britain in which the workers share, that it brings work and wages to the British workers, that without it the whole economic basis would break down. The “socialist” imperialists argue hypocritically, but in reality on the same basis, that the Empire represents a “larger economic whole” which it would be reactionary and unsocialist to break up, that it would be folly to “smash” the Empire (this is their lying expression for the proposal to leave off shooting the colonial peoples when they struggle for freedom), that to remove the British troops and imperialist exploiters would only leave these people at the mercy of their own exploiters, chiefs, landlords, princes, moneylenders and capitalists, and that the “constructive” socialist policy is first to shoot them down into submission and so to train them to British bourgeois “liberty” and even “socialism” (social-fascism).

These arguments are lies.

First, because it is the international duty of the British working-class to stand shoulder to shoulder with their fellow workers against imperialist oppression, and not to take on their hands the blood of shooting down these workers and peasants for the profits of the British money-lords.

Second, because it is not true that the national liberation of the colonial peoples means the strengthening of the native exploiters against the masses. On the contrary. It is just British imperialism that maintains, buttresses and builds its power on alliance with the most reactionary bloodsucking native elements in each country — the decaying Indian princes, the priestly powers, the landlords (often created artificially by British rule), the middlemen traders, the moneylenders. Remove the sword of British imperialism which maintains and protects these, and the working masses will soon deal with them and advance to socialism. And to the working masses in the colonial countries the British working-class will give every fraternal assistance to help and hasten their advance, but only on a basis of equality and fraternal help not on a basis of domination.

Third, and above all, because it is not only the international duty, but also the direct and urgent self-interest of the British working class to liberate the colonial peoples.

It is true that the British capitalist structure depends on the maintenance of the exploitation of the colonial peoples. Just this already makes it to the interest of the British working class to join the colonial peoples in hastening to end this domination, which will thus hasten their own liberation.

But even more immediately and directly than this. It is true, and it can be readily admitted, that, in so far as the British workers under wage-slavery depend for their existence upon employment by capitalism, their immediate livelihood is bound up with this maintenance of capitalist domination over the colonial peoples. Thus, when the Indian people rebel and boycott British cloth, the Lancashire workers suffer. But follow this argument up to where it leads.

The hold of British imperialism on the colonial peoples is a weakening hold. The revolt of the colonial peoples grows in volume and mass power every year. They will win their freedom sooner or later. It is inevitable. But what then will be the outlook of the British workers if they have united themselves with this dying and hated domination? Their means of life will be gone. No alternative future will open out before them. Starvation will face the masses. The present sufferings of Lancashire are only a foretaste of what is in store. On the basis of capitalism, which depends for its existence upon the domination and exploitation of the colonial peoples, once that domination is gone, the population of these islands will be faced with slow starvation and extinction of half their numbers.

And now look at the alternative path. The British workers unite with the colonial masses in the overthrow of imperialism. They show the colonial peoples, not in words, but in deeds, that, though British imperialism is their enemy, the British working-class is their ally. They fight for and carry through the full and unconditional liberation of the colonial peoples (not the lying pretences of “dominion status” and the rest of it, camouflaging imperialism). And now see the future of free productive relations that opens out before the free peoples on either side. The freed colonial peoples, released from the shackles of imperialism, advancing towards socialism, will have an enormous work of economic development, of industrialisation before them, since imperialism has cramped and prevented their economic development. And just the highly developed British productive apparatus will be able here to help. The production of machinery in Britain; socialist industrialisation in India — here is already an enormous path of cooperative advance, no longer on the basis of domination and exploitation, but of fraternal help, opening out in the immediate future, once imperialism is overthrown, once the colonial peoples are free, once the old wound of hatred and hostility begotten of the Empire is healed and has given place to international workers’ solidarity.


These, then, are the alternatives before the workers. Collapse of the whole existing structure in Britain, leading to conditions of famine and slow extinction for masses of the population — or the Socialist Revolution, leading to new life for all.

The capitalists and their propagandists in the working-class, the Labour reformists, try to frighten the workers from revolution by holding before them the spectre that revolution means “starvation,” that the workers depend on capitalism for their existence.

The contrary is the truth. That the workers can by the method of social revolution, and by the method of social revolution alone, rapidly overcome the difficulties of the present crisis, can rapidly reconstruct and extend production and build up exchange-relations with other countries, and win prosperity for all, has been already shown.

But it is, on the contrary, the continuance of capitalism that means starvation. For the whole basis of capitalism in Britain is going down. The former world trade domination is going down. The workers, if they depend on capitalism, can only go down with it. Already millions are unemployed, are brought down to the barest subsistence basis. Semi-starvation conditions spread, Millions, and yet more millions, will be “superfluous” before the process ends. Capitalism already grudges the bare subsistence basis, sees no way save to cut it down. Under the conditions of capitalism, the spectre of mass-starvation draws ever closer.

Forward to the fight for Socialism! Forward to the Social Revolution! There is no time to lose. To-day the workers are mobilising their forces to meet the new capitalist attacks. The spirit of fight is rising in the working-class.

What is the first need to-day? The first need is to unite the ranks of the workers against the capitalist attacks, to end the present divisions and sectionalism and reformist treachery which has opened the way to the capitalist victories, to organise the workers’ counter-offensive. How can this be done? By uniting on the basis of the immediate demands of the struggle on which all are agreed, by formulating our common programme of immediate demands and mobilising the entire army of the working-class behind them, by breaking through the fetters of reformist labour and trade union limits, and building up our independent organs of struggle and independent leadership. This is the aim of the Workers’ Charter campaign. Workers’ delegates from all over the country have drawn up the Workers’ Charter as the expression of the immediate fight ahead. The Workers’ Charter expresses the fight against wage-cuts and capitalist rationalisation, for the unemployed, for the seven-hour day, against imperialism and tariffs, etc. Here is the immediate line of fight, the first stage of the gathering workers’ fight against capitalism.

But the Workers’ Charter fight is only a beginning. The more we go forward in the immediate fight against capitalism in the present stage of decline, the closer we are brought to deeper issues of fight against the whole system of capitalism. We are advancing to larger struggles, towards a new revolutionary stage. The issue of class-power, the issue of Capitalism or Socialism in Britain, draws close.

We need to prepare for this. We need to prepare the new forms of struggle. We need to build up a strong and centralised army of the working-class fight. How can this be realised? Only by building up a strong revolutionary party of the workers, a mass Communist Party, uniting all the workers who are conscious of the fight for socialism, spreading out throughout the working-class, throughout the factories, docks, mines, railways, drawing together the struggle and carrying it forward, drawing together the thousand forms of mass organisation factory committees, strike committees, in the unions, in the cooperatives, in the Workers’ Charter campaign, etc., uniting and leading the fight stage by stage to the revolutionary victory.

Without a strong Communist Party there can be no final victory of the working-class over capitalism. The Communist International is the world party of the working-class, of the workers’ socialist revolution; it is the leadership of the working-class victory over world capitalism. The workers in Russia built up their Communist Party, and with it to lead their struggle they overthrew the capitalists and the landlords and to-day advance to socialism. The workers in Germany have forged their Communist Party in struggle, and now, with millions mobilised around its banner, advance closer and closer to the final conquest of power. In Britain we are faced with the same issues and the same struggle. In Britain also, let us build up our mass Communist Party as the supreme need for working-class advance.

The fight to-day against the capitalist attacks, the fight around the Workers’ Charter, is only a beginning. Let us go forward in the present struggles, determined to beat back the capitalist attacks and make them give way to the workers’ offensive; determined to strengthen our ranks, to awaken and draw into the fight ever wider masses of workers, to build a mass Communist Party; determined to advance strong and prepared to the coming issues of war, of fascism, of classpower; and determined above all against every obstacle and every defeat to carry forward the struggle to the triumph of our supreme aim — to overthrow capitalism and realise the Workers’ Dictatorship and the Socialist Revolution in Britain.