Arne Swabeck Archive   |   Trotskyist Writers Index  |   ETOL Main Page

Arne Swabeck

The British Scene

MacDonald and Rationalization

(July 1931)

In the International of Labor, The Militant, Vol. IV No. 15, 18 July 1931, p. 2.
Transcribed & marked up by Einde O’Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL).

Has the MacDonald government any “solution” for England’s crisis? Oh yes! But in reality its proposed “solution” is identical in content with that of the British financial interests, although quite different in form and in the phraseology of its presentation.

Its proposals are the overhauling of the industrial machinery – rationalization – which means closing of “unprofitable” mines, mills and factories; more labor saving machinery; more speed-up; greater output, and thus more goods at lower costs of production for the already overstocked world markets. These proposals are already being carried out and from them flow the inevitable conclusion – increased unemployment and wage cuts. The royal cabinet similarly proposes further mergers of establishments within industry and finance. This also has its sinister significance in greater monopoly, and larger and more powerful combines to dictate more effectively working conditions.

It will be recalled that more than a year ago, when, British financial interests, following in the footsteps of its two most powerful competitors, their kin of the United States and Germany, went in for rationalization, the Bank of England employed at a royal salary a rationalization dictator. His specific duty was to lay down terms for rationalization, when applications for loans were made by industrial enterprises. The “labor” government became an effective handmaiden in these schemes. The results are, as already stated, mounting unemployment and drastic wage cutting.

A Campaign of Wage Slashing

To lend emphasis to the extent of present wage cutting just a few examples will prove illuminating: During the month of April, about a million and a half British workers in some of the biggest and most vital industries accepted a reduced standard, cajoled into acceptance by their reactionary leaders who held the whip over their heads of threats to break any resistance. The railway unions, embracing some 450,000 men, received a cut, decreed by the National Wages Board, of two and a half percent for those earning less than $8.00 weekly and five percent for those earning more than $8.00 weekly. Of the clerical grades, those earning more than $500.00 yearly received a seven and a half percent wage cut. This is how the semi-governmental agencies – of the “labor” government – function to help overcome the crisis.

In the building trades the employers demanded wage cuts and changed gradings involving further reductions for 800,000 workers. Because of a threatening strike situation, the union leaders induced them to accept a six months truce, hoping meanwhile to more effectively prepare the actual cuts. In South Wales an “independent” arbitrator finally rendered an award calling for a reduction of $1.75 a week for 162,000 coal miners. Here also, when a strike became threatening, the union leaders again succeeded in cajoling them into acceptance on the promise of asking the government for the passage of a new minimum wage law – -whatever that will mean.

In the pottery trade, on the main steamship lines, and in the ship building yards, wage cuts are demanded by the employers. About 1,000,000 men in the engineering trades (machinists and metal workers) have accepted a new agreement involving reductions of standards and working conditions. These examples are sufficient to present a picture as to how the British workers fare under the rationalization of industry by the “labor” government.

It should now be clear also why these pious Christian gentlemen of the MacDonald government, in service to their capitalist masters, demand and promulgate mergers of industrial establishments. Their Coal Miners Act of last year established a state supervising organization based upon a regional division of the industry; and, since the proof of the pudding is in the eating, in this instance it was presented in the arbitration wage cut decree to the Wales miners. Now the union leaders of the Iron and Steel Trades Confederation propose to ask the government to bring the industry within the control of a public utility corporation. Their efforts will likely not prove unavailing, the same as can possibly be said for the efforts and loud clamors of Jimmie Thomas in the negotiations for the wage cuts to the railroad workers for mergers of the existing roads.

With an overhauling of industrial machinery, accomplished primarily at the cost of a lower working class level British capitalism nourishes its hopes of still maintaining a leading position in the world market. Although compelled to proceed from a greatly contracted basis it will undoubtedly fight desperately for its diminishing ration. One section is focusing its attention upon the growing market in the U.S.S.R. While these upper circles are torn with the conflict between further extension of trade relations with the Soviet Republic or prosecution of its hypocritical fight against “dumping” what they really want is to change the present adverse balance, which has obtained ever since the re-establishment of trade relations. According to the figures of the British Customs House, during the first quarter of 1931, the Soviet Union sold goods to England to the value of $31,266,635; while goods sold by England to the Soviet Union amounted to only $6,921,189.

The conflict was quite clearly expressed by Sir Geoffrey Clark a director of shipping and other companies, when he proposed the two alternatives. “One,” he said, “is united action to restrict the import of Russian goods, which is not easy to effect, especially as certain great countries are now reaping a harvest from Russian orders. The other method is to adopt a system of barter whereby Russian goods would be paid for in the goods of importing countries on the principle of balanced exchange.” Yes, not only balanced exchange but if possible to get in on that harvest. In this respect, the British capitalists are not the least sentimental.

Extension of trade relations with the Soviet Union in successful competition with the other capitalist powers, however, involves the granting of large-scale, long-term credits of which the workers’ republic is in need. And just a couple of days ago, Thomas Johnson, with the exalted title of Lord Privy Seal, announced the intention of granting long-term credits for an expected order of up toward $50,000,000 for heavy machinery material. The gigantic strides of the youthful Soviet industry will yet for some time to come require a growing trade with the capitalist world, a growing import of machinery to build the industry toward a socialist level. With long-term credits from the capitalist nations this task could undoubtedly be immensely facilitated. Unemployment is steadily mounting in England and there would seem to be a special opportunity to set the British workers into motion ground the slogan of “granting large scale credits to the Soviet Union.” To demand from the capitalist rulers to furnish such credits and to increase production in England of machinery to the Soviet Union. This special opportunity belongs to the British Communist Party. It would afford the means of creating a powerful movement around a specific demand upon capitalism at home. It would afford the means of making the British workers real participators in the building of Soviet industry.

Alas, this slogan, proposed by the International Left Opposition, has been declared counter-revolutionary by the Stalin Comintern regime. Thus by another paradox growing in the wake of Centrism, MacDonald can today appear almost unchallenged as the defender of recognition to Soviet Republic; as the defender of trade relations with it and as the sponsor of extension of these relations. The Stalin regime prefers to go the road of back-door dealings to obtain credits rather than boldly to proclaim the slogan. This method lends its assistance to bolster up the shaky government of liberal labor politicians. It strengthens the social reformism of the despicable Fabian brand of MacDonald in the face of the inevitable British working class revolt. The alternative would undoubtedly strike an immense sympathetic chord among the British working masses who have before proved their readiness to support the Soviet Union. It would help to make them real defenders of the Soviet Union and become a source of strength to the British Communist Party But the leaders of the party true prototypes of Stalinism, self-contented bureaucrats who have gradually decimated the party, are using their powers to prevent this possibility.

Arne Swabeck Archive   |   ETOL Main Page

Last updated: 5.1.2013