Michael Kidron

The Fight for Socialism – 3

(February 1958)

From Socialist Review, 8th Year No. 4, Mid-February 1958, pp. 5-7.
Transcribed by Ian Birchall, Nina Kidron & Richard Kuper.
Marked up by Einde O’Callaghan for the Marxists’ Internet Archive.

The two instalments from Michael Kidron’s forthcoming pamphlet – The Fight for Socialism – which we have already published, argued that capitalism has always to fear over-production, gluts and crises; that its old insurance policies against these ailments have greatly depreciated in value; and that its main alternative to slump today is arms production and preparation for war.

How does arms production get round the problem of over-production? After all, even the Merchants of Death spend less on wages, salaries and their own personal budgets than the value of their products. Where can they find a buyer who will spend more than his income?

There is only one such client – the State. The State can print money – in 1956 the British Government printed £125 million. The State can borrow money – in 1954 it borrowed some £160 million. We are interested in the latter.

Debt and Destruction

When the State borrows money, it gives in exchange IOUs of various kinds. The most important are called Consuls, which bear interest of about 7 percent per year (currently) for ever. There are also National Savings Certificates, Savings Stamps and other types. They all amount to the same thing: the State takes over the savings of the people who can afford to save, spends it and promises to repay in the form of interest. The accumulated borrowing is called the National Debt. Before the Second World War the National Debt was about £5,000 million. After it, it stood at £24,500 million – more than four times as much. Clearly war and the National Debt are inseparable. (Even the pre-war figure was largely the result of the first World War and the wars preceding it right from the days of the Napoleonic Wars.)

What does the State pay with? Taxes. And taxes are levied on the whole of the public. In the case of the worker and the lower white-collar worker, they are deducted from wages and salaries before pay day.

Now we can see how capitalism gets rid of its surpluses. The State taxes everybody and buys the arms for current wars (the British arms budget is now £1,441 million). When that isn’t sufficient it borrows the accumulated surpluses of the capitalists and spends that on arms too and then taxes everybody to pay back its capitalist creditors (at the rate, now, of £878 million a year). If we allow the capitalist system to continue much longer our children will be paying back money to the capitalists that sent us to be killed in order to get rid of their surpluses!

The Government budget for 1957–58 shows the position clearly. Out of a total of £5,289 million, £1,441 million is going on the arms budget for current and future wars and £878 million on paying back the money squandered in past wars. This is equivalent to saying that of every £1 that passed through the Government’s hand, 8/– is going on financing wars – past, present and future – while only 7/7 is for social services (including health, education, food subsidies, family allowances, and so on).

This, then, is all that capitalism can offer. Either a slump in which the workers starve while they wait for the goods to rot or a war in which they pay with their blood and their money as the goods go up in smoke.

This is what we must learn: it is only because the capitalists are responsible to no one but themselves that they can turn production on and off, and produce guns when they find that they sell better than hot cakes. Only because they compete amongst themselves have they got to stretch beyond the live market of consumers into the horrors of production for war destruction – whether they like it or not.

Our job is, thus, two-fold. First, workers’ control of production so that the whole of society – not a small, independent section – is responsible for it. Second, full nationalisation and central planning to abolish competition.

Last updated on 16 February 2017