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Is Cap. Worth Saving?

Ernest Erber

An Answer to the President of General Motors

Is Capitalism Worth Saving? – III

(27 January 1947)

From Labor Action, Vol. 11 No. 4, 27 January 1947, p. 5.
Transcribed & marked up by Einde O’Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL).

This is the third in a series of articles by Ernest Erber in reply to Charles E. Wilson, president of General Motors, on the arguments made by him in behalf of capitalism in his article, You’ve Got to Make a Profit, which first appeared in Collier’s and has since been reprinted in many corporation house organs for the “benefit” of their employees.Editor


“The capitalist type of economy is the one best fitted to function in a democracy, because capitalism, like democracy, is a system which places great value on the individual.”

This argument of Wilson’s has become the ace-in-the-hole in the current crop of capitalist apologetics. It adds up to saying that the preservation of democracy requires the preservation of capitalism, or that freedom is only possible under capitalism.

It is quite obvious why this became a favorite argument in behalf of capitalism in recent years. Ever since Stalinist despotism arose in Russia and fascism conquered in most of the rest of Europe, the defenders of capitalism have sought to create the illusion that political democracy has survived in the United States due to the existence of the capitalist economic system.

That capitalism was overthrown by the Russian Revolution and that it has not been restored by the victory of the Stalinist counter-revolution is quite obvious. That is why the apologists of capitalism are so anxious to point to Russia and say, “Look! That is what results from tampering with capitalism.” (We will deal with this argument under a separate heading.)

But this argument would fall flat on the ground if one were to realize that equally brutal dictatorships have arisen in capitalist countries and have flourished on the basis of capitalism. This is, of course, what happened in Germany, Italy, Spain and other countries of Europe. It is therefore necessary for the apologists of capitalism to create the concept that regimes like Hitler’s and Mussolini’s were “anti-capitalist.”

That is why capitalist propaganda in this country sought to disown Hitler and Mussolini, especially when it became evident in the late 30’s that the United States would be lined up against Germany and Italy in the coming war. That is why the American press sought to picture Hitler as some sort of a “socialist” who was at swords’ points with the German capitalists. They eagerly accepted Hitler at his word and helped spread the illusion he sought to create by calling himself a “National Socialist” and by denouncing the “international bankers.” This was, of course, intended to make himself popular with the German masses.

The real Socialists of Germany were either killed or kept in concentration camps and the big bankers of Germany cooperated profitably with the Nazi regime. Only Jewish bankers or industrialists were expropriated, their wealth going to Nazi favorites and the elimination of Jewish capitalists helping their Gentile competitors.

Hitler And Capitalism Got Along Well

The truth is that Hitler and capitalism got along well. Far from being an enemy of the capitalists, Hitler was financed by the biggest industrial and banking combines in Germany. They viewed him as the savior of German capitalism from a communist revolution. His regime did nothing that basically affected the operation of capitalism. On the contrary, he made Germany a capitalist’s paradise by dissolving the unions and workers’ political organizations and creating the Labor Front, a huge “company union” to which every worker was forced to belong.

The strict government controls which the Nazi regime established over industry were not much different from those which existed in this country under the war economy. German capitalists, like their American cousins, grumbled about shortages, priorities, manpower controls, etc., but German capitalists, like their American cousins, made billions in profits out of the war. If the German controls were stricter and more far-reaching, it was only because the strains of the war upon German economy were much greater than in the United States. The right of German capitalists to own productive property and to exploit the workers was neither abolished nor curbed. Fascism was a different political system than had prevailed previously in Germany and Italy, when these nations operated under parliamentary democracies. But fascism was not a different economic system; it was still capitalism.

We can therefore see that, contrary to Wilson’s assertion about capitalism being the type of economy that is “best fitted to function in a democracy,” the capitalists of Germany and Italy preferred fascist tyranny as the political system best suited for capitalism.

Does it therefore follow that all capitalists prefer fascism? No, such is not the case. Capitalists prefer political democracy – as long as it suits THEIR interests. But when capitalism breaks down in an economic crisis and when the political situation threatens to undermine capitalist institutions, the capitalists eagerly look for a Hitler or a Mussolini who will save their system by “putting labor in its place.”

But since economic crises are inescapable under capitalism and since they bring anti-capitalist political movements in their wake and since these cause the capitalists to see their salvation in fascism, it becomes evident that sooner or later capitalism and democracy prove to be incompatible.

Contrary to Wilson’s argument that only capitalism can give us freedom and democracy, we can see from the history of the last twenty-five years that the continued existence of capitalism is guaranteed to give us the barbarian and bestial rule of fascism.

Capitalism and Democracy Clash

Though the contradiction between capitalism and democracy is fundamental, only time and events, however, bring it to the surface where it becomes obvious to everyone. When we live under a mixture of capitalism and democracy, as we do in the United States today, the effects of this contradiction remain latent. Compared to past social orders and to other countries of the world, we enjoy a considerable range of political freedom. Yet the possibility of using this political freedom to affect the course of politics in this country steadily diminishes. When the population of this country was composed overwhelmingly of farmers who owned their land, of small business men, and of craftsmen who worked with their own tools, political democracy was an effective means by which the mass of the people could influence the course of government. Today, however, the great concentration of wealth at one pole and the huge mass of wage earners at the other, has confronted the nation with fundamental economic questions as the primary problem.

These economic questions cannot be solved within the framework of capitalism. If political democracy is to have any meaning today, it must take its meaning in the struggle to overthrow capitalism. If it does not, capitalism will overthrow political democracy. The two cannot live side by side forever. The worker cannot remain a free citizen with freedom to read what he pleases, speak his mind as he pleases and vote as he pleases during part of the day, while being a wage slave whose every minute is ordered by an autocratic hierarchy of corporation officials from the moment he punches his time clock.

Eugene V. Debs, tireless tribune of the early Socialist movement in this country, was fond of paraphrasing Lincoln and saying that this country would not remain half free and half slave; either the workers will utilize their political democracy to overthrow capitalism and carry democracy into economic life, or the capitalists will overthrow political democracy and carry their industrial dictatorship into political life.

Capitalism and the Individual

“Capitalism ... is a system which places great value on the individual,” says Wilson. This would be a great joke if it were not at the expense of the workers. An article entitled Labor Isn’t Striking for Money in a recent issue of Magazine Digest makes a point that has rarely appeared in the capitalist press. The article points out that capitalism (it does not, of course, use that term) has robbed the worker of his dignity as a human being and made him into little more than an adjunct of the machine. It quotes from another source to say the following:

“The worker hates to feel himself the prisoner of a timecard. Over his name, in the timecard, in much larger numerals, is his factory number. Nobody know’s Joe Worker’s last name, except the fellow in Department No. 6 who bowls with him Friday nights. Even his pay is handed to him in an envelope addressed by number only.”

The article goes on to describe how workers are bullied by foremen unless they have the protection of a strong union. It then describes the piecework and quota system and says: “There is not much incentive to beating the quota for so many pieces a day, except that if he’s low man he’ll probably be fired.” It then continues to point out the effects of monotony resulting from doing the same operation over and over again, the fear of unemployment due to labor saving devices, advancing age or depressions, etc.

The above true picture of the worker’s real life under capitalism should be sufficient to indicate how great a value capitalism places upon the individual. (If Mr. Wilson meant the individual capitalist, we are of course on the wrong track and have to grant that he has a point.)

Capitalism means neither democracy nor individualism. It dehumanizes a man on the job and turns him into an automaton of production. In order to protect its right to thus exploit labor, capitalists will eagerly abolish democracy and make of man also an automaton of a fascist state.

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