Hugo Oehler Archive   |   Trotskyist Writers Index  |   ETOL Main Page


The Bosses’ Tax Problem and the Workers

(May 1932)

From The Militant, Vol. 5 No. 22 (Whole No. 118), 28 May 1932, p. 2.
Transcribed & marked up by Einde O’Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL).

The bosses have tried every imaginable remedy for the crisis. To no avail. Now they hope to find a lever to raise their profits by lowering taxes. The campaign to lower taxes has swept the bourgeois world like wildfire. Through every avenue at their command the capitalists and the landlords are clamoring for economy in government. They want “cheap government” and the support of the working class to force a curtailment of expenses.

Chicago and the other leading cities are bankrupt, the national government is running in red at the rate of seven million a day. Congress is struggling to make a two and a half billion income meet a four and two-thirds billion expense for 1932. The capitalists say the government bureaucracy is excessive and the increase of the cost of government has kept far ahead of the increase of wealth. However a comparison of value produced in America with other industrial countries and the taxe paid will show that the British, German and other capitalists pay far in excess the taxes the American capitalists pay.

The cost of the American government, city, state and national, amounts to twelve billion a year and the total indebtedness of the government is thirty billion with the Federal government holding sixteen billion of this debt. All sections of the capitalists are hit by the deepening crisis and each section is trying to shift the burden to the other sections and all are trying to shift the burden to the workers. As far as the crisis is concerned, the capitalists are constantly shifting the burden (unemployment, wage-cuts) to the workers but their attempt to shift the tax burden to the workers will not succeed. Each section of capitalist robbers in attempting to shift the tax burden to the other sections of their class is endeavoring to line up the workers on their side.

The recent attempt to put through the sales tax in the form presented to the House of Representatives was an attempt to shift the tax burden to the petty bourgeoisie. The small capitalist was able to rally sufficient forces to throw the bill back and now they are fighting to see who will pay the increased taxes. The different sections of capitalism are well represented in the lobby and behind the politicians’ closed doors. The curtailment of production and the falling off of the capitalist incomes has reduced the income tax, forcing the bosses’ office boys in Washington to find another way out.

The first year of the crisis showed a fair return from income tax but the present year tells another story. In 1930 the forty-five million gainfully employed (workers and capitalists, etc.) listed 2,411,000 million liable to income tax. This small number paid two-thirds of the 1930 Federal government expenses. When the profits were rolling in the capitalists paying the tax bill did not object so loudly, but now we hear a different tale. In this struggle to hold up profits each section of the capitalists wants the other section to pay the tax, yet each section wants to dictate to the political office boys what to do. The financiers desire to push the burden on the shoulders of the industrialists and the industrialists would like to place the taxes on the landlords, who all hope to shift it to the small capitalist.

All the .capitalists would like to shift it to the workers but are unsuccessful in this task, at least they desire to rally the workers behind them in an attempt to correct their office boys’ “excess spending”. When the capitalist robbers fight each other they want us to help them. We workers would be more than foolish to help one section of the capitalist robbers against another section on the question of war, taxes or any other struggle. The capitalist robbers as a whole rob the workers and the robbers’ division of the spoils is not our problem. Rather, our problem is to expropriate the expropriators.

Many workers will say, “I do pay taxes and will enter the campaign to reduce the cost these political crooks are piling upon our shoulders.” We did not say that workers do not pay taxes. We say the workers have no interest in helping the bosses cheapen their government. What the workers pay as taxes is only a small part of the funds collected for taxes. It is not the task of the workers and our party to fight for “cheaper government”. The tax question enters in our problems, in the class struggle, as an auxiliary problem on which we will speak later. For the sake of argument, suppose all the taxes were shifted to the workers, on our cost of living. The capitalist economists tell us that taxes amount to ten per cent of the cost of living? What if we would help the bosses reduces this to five per cent of the cost of living. The fall of the cost of living by five per cent would be a signal for the bosses to reduce wages from ten per cent upwards. Wages always fall faster than the cost of living and always rise Blower that the cost of living and wages only rise, no matter how the cost of living goes up, providing our class fights for more real wages.

It is futile to point our main class guns at the point of consumption, at the cost of living, etc. Our main struggle must be at the point of production. The tax question enters into the struggle as an auxiliary problem. However, no enemy is defeated by concentrating forces in auxiliary struggles. We participate in elections but do not advocate parliamentary action like the Second International. It is only an auxiliary for our class struggle. The tax question under special consideration must also be on our agenda depending upon conditions. Inflation, price rise and taxes are used by the bosses at certain times to reduce the standard of living by indirect wage cuts.

We must be prepared for such moves, but the present campaign to reduce expenses of government is aimed at something far more important for the capitalist class. Even when we have inflation, rise in prices or tax shifting in sections we do not aim our class guns at the point of consumption to remedy this problem. We strike at the more vital points in the capitalist defense.

We workers are robbed as producers, robbed of the surplus labor, of the surplus value which the capitalist divide among themselves as profits, rent, interest and to pay their office boys’ (government) and for the gangster racketeers who rob the robbers.

One aim of the present tax campaign is to reduce the bureaucracy. The imperialists need a more “efficient apparatus”. There are too many small office boys repeating like parrots the fable that “we” must keep out of Asia and Europe and stay in our own back yard. American imperialism has no choice. It must move out into deeper waters or go under.

The crisis has forced the American imperialists to retrench in order to produce cheaper commodities to enable her to defeat the competitors on the world market. For the last three years an intense retrenchment through discharge and speed up of the remaining workers has been the result. Now the third year finds the capitalist class endeavoring to cut down in other fields. Their office boys are due for a cut too. The campaign against the workers will not decrease by this move. On the contrary, the campaign against the workers takes on new forms and more intense forms. The cheapening of the government is only another way of saying – cut the workers wages. Contracts for City, State, and Government jobs ride roughshod over the “union wages and union hours.” The workers must help cheapen the government! Join the campaign and take a wage cut? The Federal employees just had a cut.

The Socialists are out for a cheap government and in Milwaukee they have proven their ability. They have proven to the capitalist they can be a cheaper office boy than those of the undisguised capitalist parties. The capitalists are cheapening their government and increasing the means of suppression of the working class. Are we to help the capitalists make a cheap government to suppress the workers? Smash strikes by a cheap government? Deport the foreign born at less cost? Legally lynch the Negro in a more economical way. Give the workers and Communists, bullets instead of bread, it is all “cheaper”. Such is the campaign for cheap government. Would a sane worker take part in such a game?

Each year the government spends over a billion dollars to pay interest and retire debts from the last war and each year they spend about a billion dollars to prepare for the next war. A billion for the last war and a billion for the coming war each year. Do they mean cheaper government in this sense? Of course not. The capitalists have no intention of reducing military expenses. They tell us government expenses must come down but we know the capitalists system is built upon waste. The capitalist mode of production is so organized that billions of dollars worth of the necessities of life are destroyed each year while millions go without necessities.

Capitalism in America has a tremendous surplus means of production and consumable articles and when pressed in war of struggle can turn over in taxes to their government ten times the amount they are turning over now and still make big profits. It is not a question of scarcity of material wealth the capitalists speak of, it is a question of reorganizing and preparing the minds of the workers to the song that they cannot add another penny to taxes. Why do they want the workers to think they cannot add to taxes? Why do they say taxes must be reduced or they will go bankrupt when some European capitalist are paying ten times as much? Because millions are starving and millions are moving for struggle for immediate relief and unemployment insurance.

Hugo Oehler Archive   |   ETOL Main Page

Last updated: 12.6.2013