The Fascist Argument Against Free Market Capitalism

I notice that as the failure of contemporary free market capitalism becomes every more obvious, its right-wing supporters are out on the net telling everyone how wonderful capitalism is. Capitalism, according to them, has lifted more people out of poverty than any socialist state has ever done. You find this repeated by the Lotus Eaters, and I recent found yet another video on YouTube put up by a right-winger.

Now there is something to this. Marx in the Communist Manifesto was impressed by the global achievements of capitalism, and industrialisation and trade has produced development and prosperity in Britain, the West and elsewhere, and lifted people out of the poverty of agricultural subsistence economies. But this hasn’t been done by capitalism alone. Trade unions have also been part of the development of mass prosperity in the industrialised nations through demands for increased wages, better working conditions and so on, a fact ignored by the right. And working people in the west enjoyed their greatest period of prosperity when capitalism was regulated as part of the post-War consensus. In Britain this took the form of a mixed economy in which the utilities were owned and operated by the state. The privatisation of these utilities, the devastation of the welfare state and the deregulation of the economy has led to a massive transfer of wealth upwards, so that the poor have become colossally poorer and the wealth of the rich even more bloated and obscene. Properly regulated, capitalism does raise people out of poverty. But free market capitalism, of the kind frantically promoted by right-wingers like the Lotus Eaters, has done the reverse.

But let’s grant them that the 19th century was an age of industrial and agricultural expansion in which people enriched themselves. Mussolini expressed this view in his speech about the corporative state he was introducing into Italy. The fascist corporations were industrial organisations, one for each industry, which included representatives of the trade unions and the owners’ organisations. The Italian parliament was dissolved and reorganised into a Chamber of Fasces and Corporations, in which these organisations were supposed to debate economic policy. In fact, it just served as a rubber stamp for the Duce’s decisions. It was, however, important for propaganda purposes, to show that Mussolini’s regime had transcended capitalism and socialism.

The Fascists weren’t enemies of capitalism, far from it. Mussolini’s constitution made private industry the basis of the state and economic life, which is why I’m using it his critique of free market capitalism against the free marketeers. Mussolini had been a radical socialist, but when the Fascists seized power he declared them to be true followers of Manchester School capitalism. In other words, free trade. This was accompanied by a programme of privatisation. In Germany Hitler gave a speech to the German equivalent of the Confederation of British Industry, saying that capitalism could only be preserved through a dictatorship. He stated that he would not nationalise any company, unless it was failing. During the Nazi dictatorship industry was organised into a series of interlocking associations subject to state control. But they were not nationalised, and the leadership of the organisations was always given to private industrialists, not the managers of state industries.

Back to Italy, Mussolini described how this initial period had begun to decay. The old family run firms declined, to be replaced by joint stock companies. At the same time, firms organised themselves into cartels. In America, these cartels demanded intervention from the government. Mussolini announced that, if left unchecked, this would lead to the emergence of a state capitalism that was every bit as pernicious as state socialism. His solution was that capitalism needed to be more ‘social’. It would be subordinated to the state through the corporations, where workers and management would cooperate to make Italy a great power once more.

Something similar has happened over the past four decades. Under this new corporativism, representatives of private industry have entered government as advisors and officials, often in the departments charged with regulating their industries. At the same time, industry has received massive subsidies and tax breaks so that much of the tax burden has moved lower down on working people. Mussolini was correct about private industry demanding state intervention, however much this is denied and state planning attacked by free market theorists. And the result is corporativism, which the free marketeers denounce as not being true capitalism. But it’s been pointed out that the type of capitalism they believe in has never existed.

Free market capitalism is a failure. The solution is not a murderous dictatorship, but the old, regulated, mixed economy of the social democratic consensus. An economy that includes private industry, but which recognises that it alone does not create wealth, and which demands the inclusion of working people and their organisations in industrial negotiations and policies in order to create prosperity for working people.

Tony Benn on Capitalism’s Failure and Its Use as System of Class Control

I put up a long piece the other day about two books I’d bought by Tony Benn, one of which was his Arguments for Socialism, edited by Chris Mullin (Harmondsworth: Penguin 1979). Benn is rightly revered as one of the great champions of socialism, democracy and working people of the late 20th and early 21st century. Reading the two books I ordered has been fascinating, because of how so much of them remain acutely relevant to what is going on now, in the last years of the second decade of the 21st century. It struck me very hard that you could open his books at random, and find a passage that would still be both highly enlightening and important.

One such passage is in the section of his book, Arguments for Socialism in the chapter dealing with the inheritance of the Labour party, where he deals with Clause IV. This was the section of the Labour party’s constitution which committed it to the common ownership of the means of production, distribution and exchange. This was removed in the 1990s by Tony Blair in his desire to remodel Labour as a capitalist, Thatcherite party. Benn however fully supported nationalization and wished to see it expanded beyond the public utilities and the coal and steel industries nationalized by the Attlee and later governments. This was to be part of a genuine socialist programme to benefit and empower working people. He also argued that this was necessary because capitalism had not produced the benefits claimed by its early theorists, and was simply maintained because it was a useful instrument of class control by the capitalists themselves, particularly the financial section. Benn wrote

The phrase ‘common ownership’ is cast widely enough to embrace all forms of enterprise, including nationalized industries, municipal and co-operative enterprises, which it is envisaged should provide the basis for the control and operation of manufacturing, distribution and the banks and insurance companies.

In practice, Labour programmes and manifestos over the years have focused primarily on the great monopolies of financial, economic and industrial power which have grown out of the theoretical operation of a free market economy. For the ideas of laissez-faire and free enterprise propounded by Adam Smith and carried forward by the Manchester School of Liberal Economists until they reappeared under the new guise of monetarism, have never achieved what was claimed for them.

Today, capitalist monopolies in Britain and throughout the world have long since ‘repealed the laws of supply and demand’ and have become centres of political power concerned principally with safeguarding the financial investors who have lost the benefits of shareholder democracy and the great self-perpetuating hierarchy of managers who run them. For this purpose they control the media, engage in direct propaganda and on occasions have been found guilty of corrupt practices on a massive scale or have intervened directly to support governments that will allow them to continue their exploitation of men and materials for their own benefit. (Pp. 41-2).

This has been thoroughly proved by the last four decades of Thatcherism and Reaganomics. The shareholder democracy Thatcher tried to create through the privatisations of the ’80s and ’90s is a failure. The shares have passed out of the hands of the working class investors, who bought them, and into those of the traditional capitalist middle class. Shareholder democracy within companies has also been shown to be extremely flawed. A number of companies have spectacularly gone bankrupt because of serious mismanagement. The directors put in place to safeguard the interests of shareholders either ignored or were participants in the dodgy schemes of the managers they were supposed to supervise. Furthermore, in many companies while the numbers of workers have been cut and conditions for the remaining staff has deteriorated with lower wages, the removal of workers’ rights and zero hours contracts, management pay has skyrocketed.

And some economists are now turning against the current economic consensus. Ha-Joon Chang’s 23 Things They Don’t Tell You About Capitalism has shown that laissez-faire capitalism doesn’t create prosperity, economic growth and jobs. He still supports capitalism, but demonstrates that what genuinely does work to benefit countries and the majority of their people economically is state intervention. He shows the benefits of nationalization, workers’ participation in management and protectionism. The American economist, John Quiggin, has also attacked contemporary laissez-faire Thatcherite, Reaganite capitalism, arguing very clearly that it is so wrong it’s intellectually dead, but still justified and promoted by the business elites it serves. He calls it in the title of his book on it, Zombie Economics, which has the subtitle How Dead Ideas Still Walk Among Us.

Thatcher’s much vaunted monetarism was effectively discarded even when she was in power. A friend of mine told me at College that Thatcher had quietly abandoned it to try to stimulate the economy instead through the old Keynsian methods of public works. And I can still remember the controversy that erupted in the early ’90s when Milton Friedman announced that monetarism was a failure. The Heil devoted a double-page article to the issue, one page arguing for it, the other against.

Tony Benn was right. Monetarism and the laissez-faire capitalism of Thatcher and Reagan was simply a means to entrench and give more power to the financial class. State intervention, nationalization and proper trade union representation were the way to protect the interests of working people. It’s long past time the zombie economics of the Blairites, Lib Dems and Tories was finally consigned to the grave, and a proper socialist government under Jeremy Corbyn and Bernie Sanders elected in Britain and America instead.

Vince Cable Spread Anti-Semitism Smears to Boost Support for Lib Dems

More lies and smears, though from the Lib Dems this time, rather than the Tories. Vince Cable has declared that anti-Semitism is exceptionally severe in the Labour party under Jeremy Corbyn. And so his party will definitely not go into coalition with a Labour government.

A Lib Dem leader saying that he won’t go into coalition with a Labour government! Well, colour me surprised! as the late, great Bill Hicks used to exclaim ironically. Like the last time the Lib Dems refused to go into coalition with the Labour party, and instead got into bed – metaphorically – with Dave Cameron and the Tories. Mike states that Cable knows that this is rubbish. In fact, under Corbyn, anti-Semitism has actually decreased in the Labour party, while outside Labour in Britain generally it has actually risen. But like the Tories, the Lib Dems are showing that they see no need to spoil a useful lie with an awkward truth.

And somehow, I really don’t think this is the real reason the Lib Dems don’t want to go into partnership with Labour. After all, they lied about their reason for going into coalition with the Tories. According to them, it was because they didn’t want Gordon Brown to be the head of the Labour party. In reality, they’d already told the Conservatives they were going to go into coalition with them long before they publicly turned Labour’s overtures down, citing Brown’s continued leadership as their excuse.

The Lib Dems have been trying to turn themselves into another far right, Thatcherite party. The Orange Book of the Lib Dem right, which supplants John Stuart Mill’s classic On Liberty, takes its name from the colours of the 19th century Manchester school. The same Manchester school of economics that Mussolini boasted of supporting when he first took power in Italy. In other words, it’s complete laissez faire, free trade liberalism with as little state intervention as possible. The Lib Dem MP for Taunton Dean in Somerset wrote a book just before the last election making pretty much the same arguments as the noxious authors of Britain Unchained. You know the sort of thing: Brits must tighten their belts and work harder, have fewer welfare benefits and lower wages in order to compete with working people in being similarly screwed by neoliberalism in the Developing World. This came from a public schoolboy, who no doubt would have screamed blue murder had someone made the point many economists are now making, that western managers are vastly overpaid.

The simple reason is that Cable is another wretched Thatcherite neoliberal, who doesn’t want to go into coalition with a Labour party under Corbyn, because Corbyn wants to undo the Thatcherite consensus and return Britain to the social democratic arrangement which gave Britain jobs, a welfare state and prosperity from the end of the War to Thatcher’s election.

I also wonder how this will affect some of the members of his own party. A little while ago I came across a book promoting the anti-Semitism smears against Labour by Dave Rich, and leading member of the Israel lobby. This claimed that the left’s anti-Semitism began in the late ’60s with criticism of Israel, including by the left-wing of the Liberals. Which begs the question: is Cable now going to lead a purge of Lib Dems, who criticise Israel and its murderous ethnic cleansing of the Palestinians, just like the Blairites have done in Labour?

And if we’re talking about racist violence, Cable himself was an economist with Shell, I believe, when that western oil company was hiring mercenary squads to murder and beat tribespeople in the Niger delta in Nigeria, who were protesting about the company’s pollution of their water supplies. Cable wasn’t responsible for the policy, but he clearly didn’t let it get in the way of working for them.

And I also recall reading in a Fabian pamphlet in the 1980s how one of the brutal South American Fascist regimes was also apparently a member of the international Liberal group of parties. In Germany in the same decade there was a massive scandal when it came out that the German Liberal party, the Freie Demokraten, or Free Democrats, were absolutely nothing of the sort, and had been heavily infiltrated by neo-Nazis. Alongside Liberalism’s veneration of John Stuart Mill and democracy, there’s a side that is every bit as nasty as the Tories. And this side seems to be dominant under Cable.

The founders of the Labour party were convinced that both the Liberals and Conservatives should be treated equally as enemies of the working class. The Liberals stood for the middle classes and business, while the Tories originally stood for the Anglican Church and the aristocracy. Neither of them represented the 95 per cent of the population, who in the 19th century constituted the working class. And it was the Liberals, not the Tories, who set up the workhouses under the New Poor Law. Lloyd George and the Liberals laid the foundations of the welfare state, which the Tories have been trying since Thatcher to destroy. And under Vince Cable, it seems the Lib Dems are trying to join them.

Cable clearly is quite happy with the continuing privatisation of the NHS, and a privatised electricity grid and railways, which offer substandard service at inflated prices for the benefit of their mostly foreign company directors. At the same time, he also wants to cut wages and state benefits, to make Britain’s working people even poorer. And I’ve seen no evidence that he wants to do anything about the welfare to work tests, which have seen tens of thousands of disabled people starve to death after being wrongly judged ‘fit for work’. He hasn’t condemned benefit sanctions, which do the same to unemployed generally. And he certainly hasn’t made any noises at all at reducing the debt burden on students. Labour brought in tuition fees, but they were increased immensely by Nick Clegg. He then claimed it was Cameron’s idea, when it was the opposite. Cameron apparently was prepared to concede their removals to the Liberals. But they were advocated by Clegg.

In the 1920s and ’30s, the Liberal party began to position itself as the centre ground between the Tories and Labour, and could thus appeal to both depending on circumstances. During the Lib-Lab pact in the mid-70s, they helped shore up a minority Labour government.

But those days are long gone, it seems. Now they’re doing their best to be indestinguishable from the Tories, just like New Labour tried to continue Thatcher’s policies.

There’s no reason for any working person in Britain to vote for them.
A vote for the Lib Dems is a vote for the Tories.
Ignore the lies and smears, and vote for Corbyn instead.

Hugo Rifkind Declares Anti-Semites Attracted to Left because of Anti-Capitalism

Hugo Rifkind is the son of Maggie’s cabinet minister, Malcolm Rifkind, so it shouldn’t surprise us that he espouses the same noxious politics as his father. He is like Boris Johnson in that he also has higher view of his own intelligence than he deserves. He once turned up on Mike’s blog trying to argue against him, only to run away when he started losing.

He turned up in the pages of the Spectator last week holding forth on the latest anti-Semitism smears against Corbyn and Momentum, a snippet of which was duly quoted in the I’s ‘Opinion Matrix’ column of selected short pieces from the rest of the press. Rifkind junior opined that, rather than trying to rebut the allegations of anti-Semitism, the Labour leader should reflect on why so many anti-Semites were attracted to anti-capitalism. It was all out of jealousy of more successful ethnic groups, he breezily declared.

Now it’s true that there, and always have been, anti-Semites amongst the Left. I found a book by one very Conservative writer in one secondhand bookshop about how many of the founders and leaders of early socialism were anti-Semites. It was clearly polemical. The argument running implicitly through such books is that because many of its leaders were anti-Semitic, socialism is intrinsically anti-Semitic. Which isn’t the case. Anti-Semitism is there, but it’s actually far less than on the right. And the Tories and their puppet media definitely don’t want you knowing that.

British Fascism grew out of right-wing, Die-Hard Conservatism at the end of the 19th and beginning of the 20th century. It was fiercely anti-immigration, especially against Jews, who were held to be unassimilable orientals, like Muslims today. It spawned a range of racist organisations like the British Brothers’ League, and became particularly acute during the First World War, when Jewish industrialists of German origin, like Alfred Mond, were suspected of favouring Germany over Britain. While the Tories have subsequently tried to purge their party of racists and anti-Semites, they are still very much present.

It’s also a matter of considerable debate how anti-capitalist Fascism is. When Mussolini became president of Italy, he was backed by the industrial and financial elite, and declared that his party stood for Manchester economics – in other words, free trade. The corporate state he created, which boasted of having trade unionists and employers together in a Chamber of Fasci and Corporations, never did anything more than rubber stamp his own decisions as Duce. It was also designed to smash the power of the unions by leaving them under the control of the managers and proprietors.

In Nazi Germany, the Socialists, Communists and Anarchists were rounded up and sent to the concentration camps along with other dissidents and racial groups, including the mentally ill, male homosexuals, prostitutes and the disabled. So were trade unionists after the Nazis smashed them. And far from nationalising industry, as claimed by Conservatives in America and Britain, Hitler actually privatised a greater number of state-owned enterprises than other European governments at the time. He also made speeches hailing the biological superiority of the owners and leaders of industry, and declared his full support for free trade and competition, although later on he subjected industry to a weak form of corporatist organisation and imposed a rigid system of central planning.

The problem can therefore be reframed by asking why so many people on the right, believing in free trade and private property, are attracted to anti-Semitism? Part of the answer, it seems to me, is that they believe that free trade and private industry are the perfect system. The argument is that, if left alone by the government, industry will be run efficiently, workers receive their proper wages, people of talent will rise to the top, and society will become increasingly prosperous and well-organised.

When the opposite is true, when wages are falling and businesses closing, right-wingers look around for a scapegoat. They go a little way to realising that the fault is the capitalist system itself, but violently reject socialism itself. Hitler set on calling his party ‘Socialist’ because it appealed to those, who only had a hazy idea what the word meant, and as a deliberate provocation to real Socialists. They may reject laissez-faire free trade and impose some restrictions on private industry, such as subjection to central planning. But their critique of capitalism, in the case of the Nazis and the Fascist groups influenced by them, was based firmly on the notion that it was fundamentally good. It was just being undermined by the Jews. Thus Hitler in a speech started out by ranting about how the Nazis would overturn the exploiters, and throw their money boxes out into the streets. But he then turned this around to say it was only Jewish businessmen, who were the exploiters they would attack. Aryan Germans were entirely good, and respected their racial fellows in the workforce. They would not suffer any attack by Hitler’s thugs.

But Rifkind and the rest of the Tory party, and the Thatcherite entryists of the Blairites, really don’t want you knowing about all this. It would confirm too many ideas about racism in the Tory party, and their hypocrisy in the latest anti-Semitism smears.

They are using these smears to deflect attention away from the increasingly obvious failure of laissez-faire, neo-liberal capitalism. Don’t believe them, and their hypocritical smears and lies.