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From The Militant, Vol. X No. 38, 21 September 1946, p. 6
Transcribed & marked up by Einde O’ Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL).
The capitalists grind out their profits from the sweat and blood of the working class. In this they are no different from the rulers of old. Both feudal lords and ancient patricians lived on the sweat of the lowly.
But capitalism, as we have pointed out, is a different SYSTEM. Unlike the slave-owner, who was content to have his hundred slaves, each to serve his various whims, the capitalist must expand or die. Chattel slavery and the feudal system stayed the same or nearly the same for hundreds of years. Not so the capitalist system.
It does not matter whether the capitalist is personally greedy, or whether he wants to exchange champagne baths, for whole swimming pools of champagne, or whether he is a nice likeable old lad like the father of the rich heroine in a technicolor movie. Regardless of these things, his hired managers and superintendents must whip his thousands of slaves into ever faster production. And the bulk of the surplus value produced by these slaves must be turned into more capital, more machines – constant capital – more contradictions for the capitalist system.
Consider the history of the American steel industry in the last few years:
In 1929, the top peacetime production year, the American steel industry, then worth two billion dollars, produced 45 million tons of steel. The steel magnates then made a 10 per cent profit, or more than 200 million dollars! In 1932 they produced and sold one third as much as in 1929 – 15 million tons of steel. But they did not make one third as much profit, they lost. And they lost over 70 million dollars!
Their capacity had grown. They had the equipment to make 75 million tons of steel but no markets to sell it in. Some other countries’ industries had the markets. The answer was war.
But in the course of war, more expansion of plants and machinery was necessary – not to take care of the markets they were going to mooch into, but in order to. make the instruments of war.
By 1944 the productive capacity was 96 million tons! And the total value of the steel plants was over 4 billion dollars. They made more profits than in 1929, but the percentage of profit was lower.
The important thing is that if only 45 million tons (the top production of peace time before the war) are produced in any year now – the likelihood is that instead of there being 10 per cent or 5 per cent profit, there will be a loss of hundreds of millions of dollars!
What does this mean? It means that the American steel industry must capture peacetime markets that it never had before. It means that the steel plants of other nations must be destroyed. It means still another imperialist war!
Progress has turned into decline. Capitalism expanded once. But now it only tries to expand with a trillion dollar war, that drains its own blood as well as its slave. And it then keeps on declining.
While destroying the steel plants of other nations, the capitalists enlarge the hungry belly of their own productive capacity – they destroy their whole economy as well. They destroy the buying power of their enemies as well as the producing power. They destroy their own customers as well as their competitors?
In its attempt to pump fresh blood into its dying system, capitalism resembles a patient getting a transfusion from his left arm into his right and during the process, losing nine-tenths of the blood on the ground.
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