GUEST BLOG: Dave Brownz – Budget whinging vs socialist planning

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Tons of reaction to the Budget that confines itself to who got what and who missed out, and why that is a bad or good thing. Have you noticed that it’s all about the distribution of income as fair or unfair, but no mention of who produces the wealth in the first place, only bland unspoken assumptions that we all do, more or less? 

So while there is lots of congratulations and/or disappointment it’s all a load of hot air in the end because the problem is not that capitalism is stuffed by some ruling elite or lobby, or big power state like China, that is disrupting what should and could be a better, different, or changed distribution of income. 

The truth is that capitalism is stuffed because it won’t invest in production while it cannot guarantee a profit as a result. It cannot cut down on the costs of labour enough to restore the rate of profit. It gets further and further into debt, as bailout after bailout creates $trillions of paper currency that will have to be paid for by this, and future generations, of workers.

But nobody is saying this! Why is nobody pointing out that the whole rotten capitalist system is running on debt and that’s why workers are being made to pay for it with their lives? 

Obviously, the bosses deny this reality claiming that business is rewarded with profits for its efforts in providing jobs. And that for this to work it must cut costs to make reasonable profits.  The neoliberal right is constantly whinging that its wage costs, environmental costs, welfare costs blah blah are cutting into profits. The National Opposition is an orchestrated whinge about bosses’ needing more subsidies to restore profits. 

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The centrist coalition between the liberal Labour Party, liberal Green party and populist NZ First, agree with the neoliberals in practice whatever their dreary purple rhetoric to the contrary. That is why the 2020 Budget delivers a life-saving bailout to bosses and almost nothing to workers in general. Even the wage subsidies go to the bosses’, and nothing substantial for benefits and support of families. 

The ‘left’ such as it exists, whinges, sorry critiques, the Budget for failing to live up to their own expectations. 

What are they? That the Govt should match its rhetoric and practice with a Keynesian solution. Reboot the economy sustainably, bailout the workers, boost wages, benefits and create jobs. This will create demand that stimulates investment in production to meet this demand. The problem is that such solutions have failed in the past as increased demand does not create new supply unless production is profitable.  If not, it leads to hyperinflation. 

Which takes us back to the imperative of cutting labour costs to ‘stimulate’ profitable investment. Fortunately none of the various modern versions of Keynesian economics (like Modern Monetary Theory- MMT) that advertise a miracle cure against inflation can force workers to agree to solve the crisis by allowing bosses to drive up the level of exploitation.   

So here we have the right, centre and left, all engaged in the parliamentary practice of the ‘pork barrel’ – all lobbying for a bigger share of the pie while ignoring who bakes the pie in the first place. 

The working class which is around 80% of the population is the elephant in the parliamentary debating chamber. It is the labour power of the mass of workers which creates the value that drives the whole system. They get part back as the value of the wage, but the rest is expropriated by the employers as surplus value. 

The value of everything hinges on this hidden social relation, and the whinging about ‘fair shares’ in the Budget is just parliamentary hot air over the distribution of this expropriated surplus-value. 

A workers’ budget would result from a democratic process based on communes of free citizens that would expropriate back the surplus-value extracted over generations. This would then be spent as social investment in the planned production of goods that would be distributed on the basis of need not greed. 

The democratic principle would not be that of the bourgeois free citizen to live under a bridge, but of the free citizen of the socialist republic working in harmony with nature to produce according to their ability, and consume according to their need.

How we get there is another story, about real, not delusory, transformation. 

Dave Brownz is TDBs guest Marxist Blogger because ever left wing blog needs a Marxist.

11 COMMENTS

  1. It is really hard for a lot of people, whether capitalist or socialist, fascist or communist, to comprehend that the Industrial Revolution was the biggest ‘mistake’ in human history and that we are headed for a period of human history best described as a reversal of the Industrial Revolution.

    Practically all the easy-to-extract high-quality coal was extracted and burned decades ago; practically all the easy-to-access high-quality oil was extracted and decades ago; practically all the high-quality easily extractable copper and numerous other metals were extracted and used decades ago.

    Practically all the easily=felled trees were chopped down decades ago; practically all the large fish in the seas and oceans were caught and consumed decades ago; practically all the aquifers close to cultivable land were tapped decades ago, and the water table in many regions has been getting lower for decades.

    A huge percentage of the arable land was stripped of nutrients decades ago, and the capacity to produce crops is dependent on ever-declining reserves of phosphate rock and other essential plant nutrients. (New Zealand’s primary sources, Nauru and Christmas Island were mined out decades ago and resemble moonscapes now).

    What we have is a totally unsustainable economic system ‘running on fumes’, with the prime driver of practically everything -oil- about to go into terminal decline (conventional extraction having peaked around 2007, and the system increasingly dependent on high-cost extraction methods such as fracking and extraction from tar sands, both of which are in immediate decline as a consequence of low prices brought on by forced extraction in Saudi Arabia and the demand destruction that has eventuated from Covid-19.

    Unstated in most economic narratives is the fact that continued use of fossil fuels will exacerbate the environmental predicament human societies find themselves in -Planetary Overheating and the ‘progressive’ extermination of species vital to continued occupation of this planet by humans.

    The ultra-rapid decline in Arctic ice cover is just one of a multitude of dire trends exacerbated by industrial civilization:

    https://nsidc.org/arcticseaicenews/

    We can either give up Industrial Civilisation and prepare for the conditions that will prevail in the near future (not likely) or have the relinquishing of Industrial Civilisation forced on us by the declining resource base and the effects of accumulating pollution (more-of-less inevitable if the first option is not acted on).

    • Most probably things will move according to your forecasts, @Afewknowthetruth.

      So or so, questions remain highly valid HOW either de-industrialization or ‘rolling disaster adaptation’ (a lifelong series of adhoc survival activities) will unfold in practical terms.

      The ways and means HOW human species will adapt – if we have the chance to do so, eventually – are an integer part of the new terrestrial / planetary ecology.

      Organization is everything.

      Under critical path conditions it will still be important to see whether humanity comes through this as “homo sapiens” (wise man) or “homo servus” (slave man).

      Old philosophical questions may be asked again – and answered – along the way.

      • I just read this today (Thursday) and it graphically demonstrates what I have been saying.

        ‘Michigan is enduring a double-whammy. While dealing with the coronavirus outbreak, two dams have burst after days of record rain. The rushing waters have flooded central parts of the states in up to nine feet of water, leading to 10,000 people needed to be evacuated while also trying not to spread the virus. Governor Gretchen Whitmer already had her plate full, with right-wing-backed protests and death threats over quarantine and now entire dwellings being swept away in a crisis she described as “almost unthinkable”

        https://www.theguardian.com/world/live/2020/may/20/coronavirus-us-live-trump-1m-cases-badge-honor-reopen-latest-news-updates?page=with:block-5ec519998f0886ce4f5d705c#block-5ec519998f0886ce4f5d705c

        Meanwhile Trump has attempted to side-track the whole issue of his incompetence and stupidity by describing the nearly 100,000 deaths and 1.5 million cases of Covid-19 as ‘badges of honor’ -leading to outrage (but no change in policy).

        We are witnessing foolhardy attempts to return to pre-Covid-19 arrangements exacerbate the impacts of Covid-19, whilst continues overconsumption of fossil fuels result in ever more record rain, record temperature, record drought events throughout the world -including the Auckland region right now.

        None of the environmental meltdown, social meltdown, and now economic meltdown will deter governments -agents of banks and corporations and opportunists- from charging ahead with counter-productive policies, thereby bringing forward collapse of the societies they claim to be saving.

        Brace for impact, because it is almost certainly coming over the next few months.

        If, on the other hand, governments and central banks do manage to pull off some ‘gravity-defying’ scams that keep the Ponzi system afloat for another year or two expect everything that matters to be made worse by the said governments and central banks, and for the next [inevitable] crisis to bring the system down.

        • That was meant to be:

          We are witnessing foolhardy attempts to return to pre-Covid-19 arrangements that exacerbate the impacts of Covid-19, whilst continued overconsumption of fossil fuels results in ever more record rain, record temperature, and record drought events throughout the world -including the Auckland region right now.

  2. Marxism does not look on industrialisation as a mistake but an inevitability. It arose because the burghers of the middle ages broke out of the insularity of European feudalism, a static mode of production incapable technological development. The middle class bourgeoisie rose to overthrow the feudal ruling class and capitalism was born.

    The new ruling class industrialised agriculture and forced the surplus population into factories that applied new technology harnessing coal and then oil energy to mass production of commodities. But already by 1850 the price of this ‘industrialisation’ was the submission of colonial peoples and pauperisation of workers in the industrial powers. Capitalist society was growing only at the expense of nature.

    This process became global by the turn of the 20th century when capitalist imperialist powers had already divided up the world into competing empires going to war to redivide the earth. At that point capitalism had become state monopoly capital where the world market was ruled over by geopolitics. It was accumulating wealth into the hands of a small ruling class while the proletariat and peasant masses suffered poverty and war. The proletariat was now the revolutionary class because the old ruling class was now incapable reducing necessary labour time to create plenty. The Russian revolution challenged bourgeois world rule, unsuccessfully as it happened.

    This situation has persisted through two major depressions as capitalism has further degenerated and is now destroying its ecological conditions for existence. It it now about to crash into a new depression which will be its last – either as a shift to survival socialism that returns to the the symbiosis of society with nature, or a collapse into climate and eco catastrophe.

    The only hope of the first option I would argue is that the new ruling class of those who work with nature as part of nature take power from the old moribund ruling class and rescue human civilisation.

    • Well then the question ought to be “is a slave who is whipped most of the time freer than a slave who is almost never whipped?” Post modernists maybe luckier but I don’t think they’re freer. The fundamental question here isn’t exploitation but being free from domination.

      The coercion in David Browns example I claim is a symptom and people can be less vulnerable to domination if they had relatively equal power and I’m talking about Unionization. I absolutely agree that power corrupts which is why we need constitutions and democratic restraints on what governments can do especially under socialism and I’m a democratic socialist but it’s also the case that it is pure economic power that corrupts.

      Yknow if we didn’t have work place safety laws, sexual harassment laws, wage laws and so on and so on then people will be far more vulnerable to problematic domination by unrestricted free markets which is essentially a situation in which people have there own little empires where they can treat the people under them like spiders trapped in a jar.

    • I agree, but we should note that the Roman Empire was predicated on slavery, theft of resources through conquest, and imposition of a transfer-wealth-upwards system via militarism and extreme violence. Additionally there were poor agricultural practices that degraded the fertility of the land.

      We should also note that, following a period of relative egalitarianism interspersed with minor invasions, the Normans conquered England and established a system of repression of the indigenous populace and imposed their version of the transfer-of-wealth-upwards system. It was the plagues of the 14th century that broke that system when there were not enough peasants to work the land and do the manual work of the ;elites’.

      Industrialism was inevitable because there was easily accessible coal and easily accessible iron ore, and a shortage of wood (much consumed in the construction of the English navy, and much burned as fuel by the burgeoning towns and cities; coal was disliked because it generated filthy fumes, but as wood became unavailable people in towns and cities were forced to use it).

      Also, the mines that the Romans had established were beginning to be become difficult to mine, as all the shallow, easy-to-extract minerals had been extracted, leading to deeper shafts and tunnels that were more prone to flooding: hence the requirement for machines that did the hard work of lifting water.

      Don’t forget Jevons Paradox, whereby improvements in the efficiency of the use of coal did not result in a decline in use but actually encouraged its use.

      By the same token, industrialist who replaced water mills with steam engines were able to generate bigger profits, leading to the installation of more steam engines.

      It was not until Tyndall discovered the absorption and re-radiation by carbon dioxide in the infra-red range in 1859 that the potential for overheating was recognized. And it was not until 1896, when the Swedish chemist Arrhenius did the maths, that the potential for overheating the Earth was quantified.

      None of that has any impact on the money-lenders and exploiters of natural resources and exploiters of people, of course. The looting and polluting continued at an ever-faster pace.

      We now live in The Age of Consequences.

    • Yes well that is a problem when you spread the information out so thinly like you to have and say the transition from feudalism to capitalism has been problematic but the real issue I claim is will we be better off with socialism in a democratic sense that I advocate or we will stick with capitalism.

      So if you agree then the real argument is how do we make those changes and there are plenty of industries in distress where money isn’t available to do that research like housing and work/jobs, public transport, pharmaceutical grade manufacturing and other advanced manufacturing that could be limited by restraints prioritised by experts in those fields that would make those sectors prime targets for nationalization rather than allowing Adam Smiths ungloved hand moving the markets around. SO, would doing that violate freedoms? That’s the issue.

      The reason I think prime nationalisation opportunities don’t violate people’s freedoms as liberals would think of freedoms or the violations of basic freedoms most worth caring about I think is a mistake. I think the kinds of freedoms worth caring about is the freedom from coercion where people can not justify the domination and subjugation of the people. If that’s not socialism then I’m happy to talk about that. If that’s not class then I’m happy to talk about it that way but certainly there isn’t any mistakes the casual observer couldn’t mistake it for social democracy. In saying that I would object to a lack of political and economic democracy over the elimination of the role of the state, regulations and a lack nationalization opportunities.

      At this point China is capitalist enough that all our displaced companies from that would flee this B+ effort at a cultural revolution would just flee to China and take advantage of China’s Yknow low wages and exploration of the worker.

  3. How do you envisage your worker run world might be brought about Dave? What circumstances would have to develop in NZ or elsewhere for a majority to vote this structure into place? Who would make the laws? Would there be an elected government? Who would decide what businesses should be set up? and to do what and for whom?
    A great deal of explanation is needed before anyone could know what they might be voting for if this was to come about democratically. If the idea is that democracy will come about after a violent overthrow of the system we have , involving a massive civil war that brought the so called communists to power in the early USSR , which was military dictatorship with no communal input into decision making whatsoever, then mercifully there is not a chance of that happening in NZ. Not from within the community anyway.
    That is not to say that the pure market capitalism we have now is sustainable either. In fact the “market” as the determinant of what is produced and who gets the benefit has been abandoned in the era of QE and “too big to fail”. If Market forces had been allowed to direct events in 2008 , and ever since, and even more so today, then the world economy would have completely collapsed . How long are we going to carry on pretending that we are in a market led capitalist economy I wonder?
    But every time I see your articles advocating Marxism and especially when you link it to the regime that claimed adherence to it in communist USSR I see an image in my mind of a desperately desolate expression on the face of a man working in a near defunct foundry in Russia in a documentary just before the USSR collapsed. That face said it all. There was nothing to live or hope for in that sterile world. Man does not live by bread alone. We need a life to hope for.
    But Cheers anyway
    D J S

  4. “We can either give up Industrial Civilisation and prepare for the conditions that will prevail in the near future (not likely) or have the relinquishing of Industrial Civilisation forced on us by the declining resource base and the effects of accumulating pollution (more-of-less inevitable if the first option is not acted on).” (Quote AFKTT)

    “The only hope of the first option I would argue is that the new ruling class of those who work with nature as part of nature take power from the old moribund ruling class and rescue human civilisation.” (Quote DB)

    These two quotes rather precisely describe the present dilemma, gradually cascading since the second half of the past century.

    Hundreds of thousands of scientists have analyzed the ecological situation and offered solutions in millions of media products. Millions of people have demanded immediate action in response to climate change, in the streets and during many, many workshops and conferences. Since decades the whole UN system and hundreds of reputable global NGOs unison work on public awareness.

    But the “old moribund ruling class” hardly moves an inch, at least not where it really counts, in means and ways of production and consumption.

    The overarching challenge for the Left is to come out of its ‘lame duck position’ and to unlock the cage of the present capital-saturated status quo.

    Think globally, act locally. The old new. Prospectively, anything else is peanuts, right now…

    https://nymag.com/intelligencer/2020/05/welcome-to-the-end-of-the-human-climate-niche.html
    https://www.pnas.org/content/early/2020/04/28/1910114117
    ….
    supplementary:
    https://www.youtube.com/watch?v=tpSa4A0R6Bk

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