Posts Tagged ‘Arms Race’

Karl Kautsky on Inflation, Unemployment and the Workers

March 19, 2014

Kautsky pic

This is the day when George Osborne will announce the budget. He has already declared that it will ‘business friendly’, which means that there will be more tax cuts for the rich, further attacks on inflation and cuts in welfare benefits. I was watching a piece on what they expect Osborne’s budget to cover on BBC 1’s breakfast show. At the same time I found this passage in the writings of the German Socialist leader, Karl Kautsky, from 1910.

Inflation and the burden of taxation and the Junkers’ [Prussian aristocracy] brutality are all based on conditions which will not change so easily: they will be just as important in 1911 as in 1910 – even more so; for the armaments race is continuing. The government will, of course, do everything possible to postpone all new demands until the period after the next elections – a reason for them to hasten these, but it will be unable to do so at will. In England the Conservatives are going strong. They have already forced the Liberal Cabinet to strengthen the Navy. If, as expected, they take the helm during the course of the year, then armaments will be increased at an even more rapid rate.

Inflation, however, will not lessen. Anyone who want to know what to expect on this score, would do well to observe American conditions, which are decisive for the international food market. We must be prepared for a further increase in prices.

Some may argue that unemployment has made a not insignificant contribution to the embitterment of the masses, and that in a year’s time it will have declined considerably because the crisis will have been overcome. This is true insofar as the next year does promise to be more favourable for business. But it is doubtful whether business will do brilliantly. And this time, even more than in the last period of prosperity, the employers’ organisations will cream off all benefits, and the workers’ only taste of prosperity will be higher prices; for prosperity means an increase in commodity prices.

Karl Kautsky, ‘The Mass Strike’, in Patrick Goode, ed. and trans., Karl Kautsky: Selected Political Writings (London: Macmillan 1983) 67.

Of course, it’s very much of its time and place, written four years before the First World War, when Britain, Germany and the European powers were locked in an armaments race. The Tories have now savagely cut back on our armed forces, though military development is continuing. But apart from that, it all seems horribly familiar. The tax cuts for the rich will see the tax burden shifted to the poor, the world is still profoundly affected by changes to the American economy, the last paragraph will certainly be true next year, no matter who Osborne says to the contrary.

The more things change, the more they stay the same.

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