Capital & Class. - 1983. - Issue 20 issue 20

Jane Humphries

The `Emancipation' of women in the 1970s and 1980s : From the latent to the floating WOMEN'S ROLE IN the `industrial reserve army' has been an

6

important theme in socialist feminist analysis . This article discusses the literature on this theme, distinguishing between the cyclical reserve army hypothesis and more secular formulations. It reviews the concept of the reserve army in the writings of Marx and Engels, in particular the three forms of the labour reserve : the floating; the latent ; and the stagnant . The concept of an industrial reserve cannot be applied to women without some apprecation of Marx and Engels' vision of female proletarianization . The author uses American data to explore the hypothesis that women constituted a latent reserve army of labour which is in the process of being fully assimilated into the labour force . Socialist feminists have suggested a variety of mechanisms whereby partriarchal social relations facilitate the continued growth and development of a capitalist economy . While the same ideas do not always appear in all socialist feminist writings, different authors having their own emphases, one theme that is almost universal concerns women's role in `the industrial reserve army' . Women are said to provide a reserve of labour which can be mobilized according to the needs of capital accumulation (hereafter known as the Reserve Army Hypothesis (RAH)) . A first distinguishing characteristic of this literature is

EMANCIPATION' OF WOMEN that, possibly because of the relative ease with which the RAH can be translated into testable hypotheses, it has been the subject of more empirical investigation than other socialist feminist themes. There have been several important studies of changes in women's participation in the dramatically transformed wartime economy (ILO, 1946) ; several studies which emphasize the importance of ideological factors in the mediation of the demands of the economy (Humphries, 1976 ; Mason, 1976), and most important of all, several studies which emphasize constraints operating on capital in its mobilization of women workers and which therefore constitute a criticism of the RAH in its crudest form . Specifically it has been argued that occupational specialization by sex creates an inflexibility in the labour market which prevents women's expulsion during periods of declining demand for labour (Milkman, 1976; OECD, 1976) . This qualification has informed subsequent empirical work which has attempted a synthesis of the reserve army and the occupational segregation approaches in an investigation of the conditions under which women would and would not operate as a reserve army of labour (Bruegel, 1979 ; Rubery and Tarling, 1982) . A second distinguishing characteristic of this literature has been its emphasis on the business cycle rather than the longer run accumulation process . The idea of a distinctive female response to short run labour market conditions dominated the initial discussions (Benson, 1969 ; Mitchell, 1971) and the empirical studies described above are concerned primarily with the procyclical movements in female employment . The reserve army hypothesis has become the cyclical reserve army hypothesis (CRAH) . Even when an author is critical of the argument that women constitute an industrial reserve, the definition of the latter in terms of response to the level of activity goes unchallenged (Szymanski, 1976) . The important exception here is an article by Margaret Simeral (1978) which contends that in Marx's and Engels' work the army has both a secular and cyclical function, a position which has some commonality with the argument developed below . The present paper is developed within these traditions with an important qualification . I argue that the existing literature is confused by the meaning of the industrial reserve army, that the identification of the industrial reserve army with cyclical variation in employment and unemployment is unduly restrictive, and that Marx and Engels had something more in mind. The concept of an industrial reserve cannot be applied to women without some appreciation of Marx's and Engels' vision of female proletarianization . The latter employs not

7



CAPITAL & CLASS 8

only the concept of a reserve army but also the idea that the substitution of female for male workers constitutes an inevitable corollary of capitalist accumulation (hereafter known as the substitution hypothesis (SH))' . The paper is organized as follows : section I discusses recent formulations of the cyclical reserve army hypothesis with particular emphasis on Rubery and Tarling's UK work. Some results obtained by applying the Rubery and Tarling model to the US are presented . Section II contains a brief review of the concept of the industrial reserve army in Marx's and Engels' writings and an attempt to distill out of this a model of the proletarianization of women which is then tested in section III using American data . The us is taken, in this context, as representative of trends in advanced industrial capitalism . Of particular importance to the general theoretical position expressed by the author here and elsewhere is the conclusion that the concept of a feminized reserve army has no mechanical universal validity but is subject to a historically specific interpretation .

Women as a `reserve army'

In the existing literature women's identification with a labour reserve has been tested by observing the variation of female employment with total employment, an approach introduced by Bruegel (1979) and refined by Rubery and Tarling (1982) 2 . The `reserve army' is understood to constitute a buffer over the business cycle, and the ebb and flow of labour is conceived in cyclical terms . Rubery and Tarling modelled this by regressing the percentage change in female employment on the percentage change in total employment, the reserve army hypothesis being that female employment is more cyclically volatile than total employment . If this is the case then the coefficient on total employment, l3, should be significantly different and greater than one' . Using primarily UK data but also extending their analysis to other advanced industrial economies and disaggregating to various levels, Rubery and Tarling found some interesting patterns in their regression results (p .51, ff .) . Analysis using UK broad sector data resulted in support for the CRAH in manufacturing only . The significant result in the case of all industries and services, Rubery and Tarling held to reflect the dominance of manufacturing . In the case of the us at an analogous level of aggregation, Rubery and Tarling reported l3 coefficients significantly greater than one for manufacturing, finance, and all industries and services, although they had reason to qualify the latter two results . Similar regressions for the us, also by major industrial

EMANCIPATION' OF WOMEN divisions, but covering a longer time span, are reported in table 1 . The results confirm the general finding of greater cyclical volatility of female employment in manufacturing . Women's employment changes were also significantly more volatile in mining and wholesale and retail trade. The data did not however support the Rubery and Tarling finding of fi significantly greater than 1 in finance nor in aggregate employment on non-agricultural payrolls . The case of mining is interesting, but such a small proportion of women is involved that it is hard to interpret the results . Here US and UK data tell different stories, as Rubery and Tarling found a very low coefficient in mining which implied a significant negative relationship between the share of women's employment and changes in total employment . At this level of aggregation the results provide only limited support for the empirical version of the reserve army hypothesis, greater cyclical volatility being confined primarily to the manufacturing sector . These results, however, relate as much to the simplistic modelling of the reserve army hypothesis as to the actual role of women in the employment structure. As Rubery and Tarling point out even if women are employed in the cyclically sensitive areas they are also employed in relatively stable areas, for example in clerical work, and moreover in employment sectors where women predominate they must necessarily form the core labour force as well as fill the secondary jobs (Rubery and Tarling, 1982, pp .53-54) . These authors are thus persuaded to move to a less aggregated level than broad industry divisions in order to capture the effects of women performing different functions within an industry's labour process . Before following them however it becomes necessary to reconsider the concept of a reserve army and particularly to see how that concept informs, and is informed by, a more general and longer run theorization of women's involvement in paid production . My starting point here is Marx's and Engels' own discussion of `relative surplus population' .

In 1798, the Reverend Thomas Malthus in a classic example of blaming the victim ascribed the misery of the working class to its propensity to increase its numbers ahead of the accumulation of capital . Elevated to `a principle of population' by reference to some empirically dubious arithmetical progressions, the Parson's thesis provided a pseudo-scientific basis for anti-working class legislation in the century that followed and remains prominent in casuistry supporting anti-welfarism today . Marx's determination to expose the reification implicit in bourgeois science and reveal numerous `natural phenomena' as

9

Marx and Engels on `the industrial reserve army'

Table 1 : Changes in United States female employment and total employment on non-agricultural payrolls by industry division Sector

Years

alpha

beta

R 2 (adj)

Total

1965-79 1961-79

Construction

1965-79

Manufacturing

1961-70

.963 ( .0699) 1 .346 ( .153) .4889 ( .158) 1 .230 ( .0503) 1 .284 ( .190) 1 .186 ( .0969) 1 .188 ( .167) .9885 ( .163) 1 .176 ( .169)

.931

Mining

.015 ( .002) .0296 ( .0072) .048 ( .0097) .0066 ( .0019) .0124 ( .0051) .0015 ( .0033) .00097 ( .0061) .0098 ( .0077) .0076 ( .0062)

Transport and Public Utilities Wholesale and Retail Trade Finance, Insurance and Real Estate Services Government

1965-79 1961-79 1961-79 1965-79 1965-79

Source : us Department of Labour

5% Significance level Ho : Beta < 1 Hi : Beta > 1

.809 .379 .971 .760 .892 .733 .718 .771

*(-)

EMANCIPATION' OF WOMEN attendant upon social organisation, specifically the exploitative social relations of capitalism, made for an obvious antagonism, which was strengthened by the vulgar anti-socialism which popular Malthusianism fed (Meek, 1971) . Marx's and Engels' attempts to rebuff Malthusianism reflect their fundamentally different theoretical perspective, for while Malthus saw `the population problem' as a natural result of `human nature', Marx and Engels argued that absolute movements in population were not responsible for the relative proportion of labour to capital, but rather that the historical laws of motion of capital themselves, in particular the rising organic composition of capital constantly re-created a relative surplus population : The demand for labour is not identical with the increase of capital nor supply of labour with increase of the working class . It is not a case of two independent forces working on one another . Les des sont pipes . Capital works on both sides at the same time . If its accumulation, on the one hand, increases the demand for labour, it increases on the other the supply of labourers by the `setting free' of them, whilst at the same time the pressure of the unemployed compels those that are employed to furnish more labour, and therefore makes the supply of labour, to a certain extent, independent of the supply of labourers . (Marx, 1967, p .640) . In the course of this debate Marx and Engels introduced the concept of the industrial reserve army which specified the relative surplus population as a social phenomenon specific to capitalism . Marx describes all under- or unemployed labour as its members, but as under- or unemployment can take several forms so can the labour reserve (Marx, 1972, p640 ff) . Marx identifies three such forms : (1) the floating ; (2) the latent ; and (3) the stagnant . Although elsewhere Engels, in particular, focusses on the role of the business cycle in creating and recreating the reserve army (Engels, 1962), here Marx explicitly excludes cyclical unemployment as a separate category, the cycle exacerbating under-and unemployment of all kinds .

The Floating Labour Reserve Marx identifies the floating reserve with workers experienced in capitalistically organized and centralized industry . Explicitly three kinds of workers are involved : firstly, adult males whom Marx sees as `let go' because they could command higher wages than juveniles, although the source of this bargaining power remains mysterious ; secondly, specialized workers who become unemployed because of technological change or

11

CAPITAL & CLASS 12

changes in the sectoral composition of output and who remain `chained' to a particular branch of industry ; and, thirdly, older workers who are `set free' because of the debilitating effects of industrial employment . Women are not only not included in the floating reserve but are explicitly identified as substituting for those prime age males who constitute its ranks . A rise in women's share in total employment thus characterizes the process whereby the floating reserve is produced and reproduced . Here as elsewhere, Marx's delineation of the reserve army is historically specific. Not only Marx and Engels, but many of their conservative as well as radical contemporaries, believed that the modern labour process, since it reduced the physical strength needed in production, facilitated the mass substitution of women and juveniles for more expensive male adults, and that this process was well underway in that epitome of nineteenth century industrialism - the cotton industry . Whether technological change did result in a restructuring of the labour force by age and sex either in individual nineteenth century industries or in the economy as a whole remains questionable . The only relevant micro-level study with which the author is familiar, Lazonick's analysis of the impact of the self acting mule, (1979), which Marx himself used as an example of technological change associated with dilution, draws negative conclusions . However Lazonick's argument that the organization of adult male workers in the context of a highly competitive industry, prevented the masters from using the self actor to substitute juvenile and female labour, does not eliminate the possibility that there was dilution in the aggregate . Adult males may have retained their principal positions within the labour process but their proportion to the total factory population may have declined. A lack of data makes it very difficult to investigate this and other aggregate versions of `the substitution hypothesis', and the issue is further clouded in that even if the early factories employed high proportions of women, often the handicraft production that was displaced was also 'feminized' (Tilly and Scott, 1978 ; Bythell, 1978 ; Pinchbeck, 1961) . At the macro level available evidence suggests that there was no mass movement of previously unproductive women into wage labour or that women were substituted for men on a large scale . While it is not my intention to deal with the failure of widespread substitution to occur in the course of industrialization in this paper (but see Humphries,1977 ; Humphries and Rubery, 1981) ; I will argue that the substitution hypothesis is more appropriate to contemporary advanced industrial capitalism and indeed that this process is underway in the United States . The

EMANCIPATION' OF WOMEN interesting question today concerns the interaction between such a secular substitution process and a sex-segregated productive structure ; though it should be apparent that a sexual division of labour is less of an obstacle to secular substitution than it is to substitution over the business cycle . The Latent Labour Reserve

The latent labour reserve Marx describes in the concrete terms of the labour potential in precapitalist agriculture . As capitalism permeates the agricultural sector, `the law of capitalist accumulation' (i .e . the rising organic composition of capital) reduces the demand for agricultural labour which thus constitutes a source of labour for non-agricultural employment . The production of this latent reserve relies upon labour saving technological change in capitalist agriculture . Marx's vision here seems to have been historically accurate, for agricultural employment does decline both absolutely and relatively during industrialization with rising productivity preventing a decline in agricultural output . The value of this category to capital lies in its dormancy combined with a responsiveness to the demands of the accumulation process . Agricultural migrants initially are perfect members of the latent reserve since not only are they attracted to industrial employment without any increase in existing wages (i.e . available in elastic supply) but also during periods of reduced demand for labour they can be persuaded to drift back to their native villages thus reducing the cost of recession to capital, which one way or another is partially responsible for the otherwise bloated welfare rolls and escalated costs of maintaining urban law and order in the face of high unemployment and mass deprivation . But over time rural migrant labour loses these happy qualities . Migration becomes increasingly permanent for larger numbers of people and extends intergenerationally . Ties with the rural areas are lost . Simultaneously capitalism develops to the point when it can finance a higher level of unemployment - indeed this is a contributory reason for the migration assuming a more permanent character . Thus while for a time the cyclical demands of capital can be absorbed by the latency of the agricultural reserve, secular trends undermine that very latency . The latent relative surplus is converted into a floating relative surplus as industrial capital expands . The rise in female participation rates in the post World War 2 period constitutes a re-enactment of the same process - the discovery, exploitation, and, I will argue, ultimate conversion of a second latent labour reserve . Housewives like precapitalist

13

CAPITAL & CLASS 14

agricultural workers initially constituted a pool of unexploited labour hidden in the sense of not representing a drain on the capitalist surplus, but able to respond to the demands of the economy . This is obviously what socialist feminists have in mind when they identify women with `the reserve army' . Again capital could work on both the demand for and the supply of this labour . Capital's infiltration of household production has, at least partially, displaced household workers making them available to industrial production . While it might be thought that housewives constituted a superior labour reserve in that they could be permanently maintained as a temporary supplement, the modern household sector unlike precapitalist agriculture is no repository of means of production that can be spread over more workers without a collapse of productivity at the margin . The argument here is that women have been rapidly assimilated into the labour force, initially primarily as a result of expanding demand in 'feminized' sectors but increasingly because of pressures on working class standards of living (Applebaum, 1981 ; Currie et al, 1981 ; Humphries and Rubery, 1981) . There is no slack in the household economy capable of absorbing a large scale retreat of women workers . Thus in the 1980s the identification of women workers with a latent industrial reserve is anachronistic . This has several implications . First, the exhaustion of the latent reserve army means that capital has to recreate such a reservoir elsewhere, the obvious target being Third World countries with their own relative surplus populations_ Metropole countries must struggle only to design institutions (temporary passports, guest worker arrangements, immigration regulations) which preserve the temporary status of such workers .` Second, and more important to the argument developed here, the assimilation of female workers creates a historic conjuncture in which the classic Marxian substitution effect can come into play . Thus over the course of development of capitalism, these two aspects of the reserve army interact to facilitate the accumulation process . The mass substitution of female labour did not happen in Marx's own time because women, by and large, remained a secondary element in the latent reserve ; Marx's own emphasis on agricultural labour was historically corrects But this ordering has been destroyed in the post World War 2 period and circumstances are now conducive to the operation of the substitution effect . I argue below that this effect is already empirically discernible .

EMANCIPATION' OF WOMEN

The Stagnant Labour Reserve The third form of the relative surplus was something of a residual category . It included those who were employed or underemployed in precapitalist sectors of the economy, in outwork, handicraft production, etc ., but also extended to pauperized labour and the `dangerous classes' ; the unemployed and petty and not so petty criminals . Although these different categories share characteristics, they are also marked by basic differences . Workers in precapitalist industry, like those in precapitalist agriculture, constituted a latent reserve that could be absorbed as capital expanded, again with capital operating on both the demand and the supply of labour . Moreover this labour often possessed the skills or at least the discipline that was desirable in the early factory labour force . The same cannot be said of the 'lazarus layers' . It seems inconceivable that these latter individuals could ever be usefully mobilized in capitalist production, although they may well have served some function in terms of the operation of the system as a whole . For example, their mere existence, whether or not they could actually displace existing workers, might have served to discipline the employed although it is hard to see how they could have represented a dormant threat if displacement was patently inconceivable . Modern analogues for these groups exist . Sections of the economy remain imperfectly penetrated by capital : the household sector can reasonably be thus interpreted ; and labour employed therein constitutes, a modern stagnant reserve . The nineteenth century's unemployed and unemployable lazarus layers have their modern counterparts although again a simple functionalist interpretation of their existence seems weak . Women are undoubtedly disproportionately represented in the stagnant reserve given their predominance in low productivity, badly paid secondary jobs . The role such women workers play is practically synonymous with their functioning as a latent reserve and comments offered in the latter case are again relevant . Female assimilation The argument of this paper is that in the modern period women constituted a labour reserve, which has been gradually exploited by capital: witness the secular increase in female participation rates since World War 2, particularly those of married women . During the years when women were being drawn into the active labour force their employment was likely to be more cyclically volatile than that of men . Thus the usual interpretation

15

CAPITAL & CLASS 16

of the reserve army hypothesis is a cyclical reflection of the secular process of erosion of a latent reserve . Women, as the `newest' workers initially may be disproportionately represented in cyclical unemployment, but as their conversion from a latent reserve progresses women workers are assimilated into the labour force and a secular homogenization of labour begins to dominate their cyclical differentiation . Of course, it is possible that women may be a peculiar latent reserve incapable of true absorption because of sex segregation in the employment structure . The latter has however no basis in the laws of motion of capitalism which predict that as women are taken up they are converted in representative proportions into `primary workers' . As such they may suffer cyclical unemployment but with no higher frequency than their male counterparts . This model suggests that the observation of a sex segregated employment structure and women's relatively lower wages, rather than signalling sex discrimination on the part of employers or other (male) employees, simply reflects the historic assimilation of the latest latent labour reserve, which happens to be female and whose initial experience in paid labour is in secondary employment . There may, of course, be sex discrimination on the part of individual employers and/or workers, and there may be reasons for collective capital to seek to permanently crystallize the existing structure of employment along sex linked lines, but these forces are antithetical to the logic of capitalist development . For once women have been drawn into the labour force in large numbers, their relatively lower wages must force a substitution of the kind Marx envisaged . This is the prediction of the theory . It is, of course, extremely difficult to translate these secular trends into hypotheses that can be tested with existing data, expecially as the more dramatic of these developments are still very recent . Hence the empirical evidence cited below is suggestive only . Rising female participation rates are sufficient documentation of the exploitation of the latent reserve of female labour . The Bureau of Labour Statistics in predicting female participation rates (which they have consistently underestimated in the post World War 2 period) were dismayed to find that if they simply extrapolated the participation rates of women aged 25-29 from their rapidly rising trend of the 1970s they would exceed the rates for men of comparable age groups before the 1980s are over (Us Department of Labour, 1979) . This rather disturbing result was avoided by the sure, if unimaginative, device of a ceiling to the female rate derived from the male rate . The emancipation of female workers from their latent

EMANCIPATION' OF WOMEN status would be reflected in a gradual diminution in their disproportionate sensitivity to cyclical unemployment . Our already rather negative results on the reserve army hypothesis tend to support this argument as does the empirical evidence of both Szymanski (1976) and Simeral (1978) . However Szymanski takes the position that women have been integrated into the permanent labour force, while I believe this process to be only currently underway (and here the six years since Szymanski's article appeared are crucial) . In terms of the earlier empirical version of the CRAH I anticipate lower coefficients in the more recent period than in the 1960s and 1970s . Going beyond the existing empirical work to an examination of the substitution hypothesis the problem becomes definitional . What do we mean by substitution? The simplest and most obvious case where female employees replace men is only detectible at the level of the firm, and even then may be obscured by a simultaneous restructuring of the labour process, introduction of new machinery, contracting out of certain activities, etc .' While micro studies are urgently needed in the us context, the present essay is concerned with a more macro perspective . At this level the relative growth of female employment associated with the restructuring of the economy, that is the relative growth of the feminized sectors, has become a commonplace of advanced industrial economies . In the 1950s and 1960s the dramatic growth of the service sector and derived demand for women employees promoted the rapid increase in female participation rates . But as long as male employment continued to grow, albeit less rapidly than female employment, a rise in women's share of total employment might not be considered `substitution' . More recently, in the US the continued increase in female employment in the face of a falling or stationary total number of jobs must imply that women are advancing at the expense of men although whether this process can be called `substitution' is also a matter for debate . At a more disaggregated level substitution implies female penetration of male dominated sectors of the labour force and, following Marx, attention is focussed particularly on the industrial sector . Investigation of the substitution hypothesis therefore involves analysis of the rate and distribution of growth in female employment . The argument again seeks to distinguish between patterns observed in the 1960s and recent experience . Whereas earlier women's employment growth would be concentrated in feminized sectors, in the last decade I anticipate their growing significance in new areas . Also of interest is the hypothesized increasing vulnerability of men to . ejection into the floating reserve, tests of which unfortunately founder on the inadequacy of unemployment statistics c.

&

C . 20-B

17

CAPITAL & CLASS 18

and (again) the difficulties of micro-level studies . However some simply collaborating evidence might be obtained from trends in the relative incidence of unemployment among men and women in employment . If women are actually being substituted for men in production, then there would be a positive relationship between unemployment rates and the relative share of women in employment .

From the latent to the floating Women's `emancipation' in advanced industrial capitalism

It was argued above that if women have made the transition from the latent to the primary reserve there would have been a decrease in the relative volatility of their employment over time . Still at the highest levels of aggregation (i .e . industry division), as a crude test of this hypothesis, I sub-divided the time series into two subsamples : 1965 to 1974 and 1974 to 1979 . The hypothesis of a secular decline in the cyclical volatility predicts a fi significantly greater than 1 in the first period and significantly less than or equal to 1 in the second period . The results are reported for all industry divisions except mining and construction in table 2 below . In only three cases was there any evidence of a decline in the relative volatility of women's employment . In both total non-agricultural employment and services employment although the CRAH could be neither rejected nor accepted in the earlier period, li was significantly less than 1 in the later period . However in neither case did an F test reveal significant change in the structure of the equation between sub-periods . In government employment l3 was significantly greater than 1 in the early period but not subsequently which again lends some support to the hypothesis of transition from the latent to the primary reserve . In manufacturing female employment was more cyclically volatile than total employment in both sub-periods . In the other major industry divisions the results were not significant . However given the relatively poor performance of the CRAH at this level of aggregation it is not surprising that tests which make further demands on the data should be inconclusive . The major stumbling block here is that the data series is really too short to test for structural change over time . Following Rubery and Tarling the cyclical reserve army hypothesis was then tested at lower levels of aggregation, that is by major industry groups . The results, reported in table 3 below suggest similar patterns in the employment of women across industries in the us and UK but can also be interpreted as rather striking evidence supporting the argument that a sex differential in the cyclical volatility of employment simply indicates that the absorption of female workers is incomplete . After estimating the



EMANCIPATION' OF WOMEN equation relating changes in female employment to changes in total employment and testing for the significance of the 13 coefficient, I ranked industry divisions according to the percentage of women employees in total employees in 1979 . The results are reported in table 4 . In durable goods industries there are no 'feminized industries', that is industries in which women represent more than their share in total employment, although miscellaneous manufacturing is getting close . In all industry divisions where women comprise more than approximately one fifth of the labour force the CRAH was accepted . The interpretation is that

19

Table 2 : Changes in female employment and total employment on us nonagricultural payrolls by industry division, sub-period analysis Sector Subperiod alpha 13 RZ(adj) 5% significance Ho : 13< 1 Hi : 13 > 1 Total employment 1965-1974 1974-1979 Manufacturing

1965-1974 1974-1979

Transport and Public Utilities

1965-1974 1974-1979

Wholesale and Retail Trade

1965-1974 1974-1979

Finance, Insurance and Real Estate

1965-1974 1974-1979

Services

1965-1974 1974-1979

Government

1965-1974 1974-1979

.011 ( .004) .082 ( .002) .008 ( .002) .008 ( .003) - .006 ( .011) .017 ( .006) - .005 ( .007) .012 ( .006) - .003 ( .012) .015 ( .005) .004 ( .010) .286 ( .007) - .008 ( .005) .028 ( .010)

1 .080 ( .126) .891 ( .043) 1 .219 ( .060) 1 .278 ( .065) 1 .523 ( .504) 1 .230 ( .177) 1 .33 ( .184) .975 ( .177) 1 .234 ( .302) 1 .041 ( .128) 1 .082 ( .229) .633 ( .139) 1 .5376 ( .110) .284 ( .439)

.900 .988

*(-)

.981 .987 .504 .904 .865

.854 .662 .929 .725 .796 .960 - .130

*(-)

CAPITAL & CLASS 20

industries where women are less than 20% approximately of total employment (the empirical cutoff point is given by the 19 .2% female share in the machinery industry) they have not yet penetrated a wide range of production jobs but are likely to be concentrated in clerical work, cleaning, packing etc . Whatever else may be said about this segmentation it does afford some relative protection in the business cycle hence the rejection of the CRAH in such industry divisions . Where women comprise more than 20% of employment they have obviously penetrated beyond their traditional enclave . As production workers and often relatively recently recruited production workers their employment pattern is consistent with the CRAH . The results for non-durable industry divisions are even more suggestive . Here we have two industries, apparel and

Table 3 : Change in female and total employment on us manufacturing payrolls by major industry group 1961-1979 Durable Goods

Industry Group

alpha

.011 ( .004) Lumber and .040 Wood products ( .010) .021 Furniture and ( .007) fixtures .011 Stone, clay and ( .004) glass products Primary metal .031 products ( .008) .007 Fabricated metal products ( .005) .050 Machinery except electrical ( .006) Electric and .002 electronic equipment ( .003) .014 Transportation ( .011) equipment Instruments and .004 related products ( .004) Miscellaneous .008 manufacturing .002 industries Total

beta

R2(adj)

1 .413 ( .080) 1 .202 ( .178) 1 .204 ( .126) 1 .131 ( .101) 1 .077 ( .166) 1 .432 ( .091) 1 .316 ( .109) 1 .408 ( .049) 1 .235 ( .184) 1 .341 ( .070) 1 .225 ( .045)

.945

5% significance level Ho : beta _< 1 Hi : beta > 1

.714 .833 .874 .696 .932

*

.890

*

.978

*

.710 .953

*

.976

*



EMANCIPATION' OF WOMEN leather, which are `feminized', that is the employment of women exceeds 50% of total employment . Here women have clearly moved beyond their latent reserve status and become fully integrated . Consequently, as predicted, female employment in these industries is not relatively more affected by booms and slumps . In the middle range of industries defined by the share of women's employment in total employment, that is 20% to 40%, which here means paper and allied products through to textile mill production the CRAH was accepted . The exception here is the tobacco industry where women comprised 36 .6% of all workers in 1979 but where the 13 coeficient was not significantly greater than one . The explanation for this exception may lie in technological changes in the industry . Certainly tobacco is distinctive in other relevant respects, being the only industry in which the

Table 3 : Change in female and total employment on US manufacturing payrolls by major industry group 1961-1979

Non Durable Industry Group

Total

alpha

.004 ( .001) Food and kindred .012 products ( .002) Tobacco - .010 manufacturers ( .005) Textile mill products .005 ( .001) Apparel and other .002 textile products ( .001) Paper and allied .001 products ( .004) Printing and .015 publishing ( .003) Chemicals and .010 allied products ( .003) Petroleum and .023 coal products ( .007) Rubber and .005 miscellaneous plastic ( .006) products Leather and .010 leather products ( .003)

beta

RZ(adj)

1 .324 ( .045) 1 .540 ( .191) 1 .293 ( .175) 1 .141 ( .033) 1 .014 ( .023) 1 .294 ( .116) 1 .171 ( .098) 1 .339 ( .107) 1 .107 ( .265) 1 .219 ( .095)

.980

1 .087 ( .063)

.781

5% significance level Ho: beta < 1 Hi : beta > 1

*

.749 .985

*

.990 .872

*

.885

*

.896

*

.478 .902

.943

*

21

CAPITAL & CLASS 22

trend in female employment is negative and women represent a decreasing share of the labour force over time . While Rubery and Tarling have a dual labour market interpretation of the link between the relative volatility of women's employment and the importance of female labour within an industry, the argument here is that any greater cyclical volatility reflects the imperfect absorption of female labour . As women come to represent the major share of employment in a sector their employment cannot be substantially more cyclically volatile than total employment . This is what the cross-section tells us . Women's role as a cyclical buffer emerges as a characteristic feature of a phase in the process of their emancipation from the latent to the floating labour reserves . Attention is forced back to the longer run process of proletarianisation and in particular to the substitution hypothesis . It is difficult to separate out the effects of the business cycle from these secular trends both empirically and

Table 4 : Ranking of industry division according to the share of women in total employment in 1979 Durable Miscellaneous manufacturing industries Instruments and related products Electric and electronic equipment Furniture and fixtures Fabricated metal products Machinery except electrical Stone, clay and glass products Transportation equipment Lumber and wood products Primary metal products Non-Durable Apparel and other textile products Leather and leather products Textile mill products Printing and publishing Tobacco manufactures Rubber and miscellaneous plastic products Food and kindred products Chemical and allied products Paper and allied products Petroleum and coal products

Share of women workers 47 .4% 42 .6% 42 .4% 29 .6% 20 .9% 19 .2% 18 .8% 15 .6% 15 .0% 10.7%

81 .9% 60 .7% 47 .4% 39 .1 36 .6% 35 .2% 29 .4% 24 .4% 22 .9% 12 .5%

i >1

* * *

* * * * * *



EMANCIPATION' OF WOMEN conceptually . Substitution is arguably furthered during the upswing when new capacity is installed and there are more opportunities for modification of the labour process, tighter labour markets and smoother relations with trade unions (Bruegel, 1979) . But on the other hand, as Rubery and Tarling note, prolonged recessions like those currently experienced in the UK and US may have very different implications for substitution than the kind of `managed recessions' experienced earlier (p54ff) . The cycle may be an intrinsic element in the secular process of substitution . More specifically the current deep recession, following the long boom of the 60s, when rising demand for labour promoted dramatic increases in female participation rates, in conjunction with a transformation of the American family, has created conditions in which substitution of women for men may be a logical response across a wide band of jobs within diverse industries . A direct confrontation of the substitution hypothesis imvolves an analysis of the distribution of the growth in female employment . If women are simply responding to an increased demand for female labour within already feminized industries, we would expect to find a major part of the growth in female employment concentrated in the latter kind of industry . Alteratively substitution of women for men within the industrial structure would involve a high proportion of the increase in

23

__ P 4 - ___ 0 it < 0 .20

Sit-1 <0 .20

0 .20 <eit <9t 9t < 0it <0 .55

A

0 .55 <9 it

B

Ad

4hh,-

o e >0 .08

o .2o<e it _ 1

<e t _ 1

A

C o e <0 .08

B

B

pm& 46,

V

o 9 >0 .08

e t-1 < 9 it-1 <0 .55

C

pAd& r

C

D

D

o 9 <0 .08

0 .55<9 it-1

E

___

Note : the cells markcd with a cross contain no industry groups .

CAPITAL & CLASS female employment being concentrated in industries initially dominated by men . To test this hypothesis, industries were classified according to the proportion of female employees at both the beginning and the end of the period reviewed, and labelled A . predominantly male, B . showing penetration by women, C . mixed, D . becoming feminized, and, E . predominantly female . 7 The categories are defined according to the following scheme : if fi and mi are the numbers of women and men in the i th industrial group, and F and M are the numbers of women and men in the industrial labour force, define 9i = fi/(fi + mi) and 8 = F/(F + M)

24

writing 9 it-1 for 9i at the beginning of the period, etc The proportion of the increase in female employment occuring in each category is reported in Table 5 below . Table 5 : Distribution of the Growth in Female Industrial Employment, 1964-1979 1964-1979 1970-1979 of the growth in Female Employment occurring in : A . Industry B . Industry C . Industry D . Industry E . Industry

groups that were predominantly male groups showing penetration by women groups that were mixed groups undergoing a process of feminization groups that were predominantly female

27 .7 17 .4 41 .1 9 .0 4 .9

40 .3 15 .9 30 .5 22 .7 -7 .4

From 1964 to 1979 although more than 40% of the increase in female employment occurred in industries classified as `mixed' a higher proportion involved jobs in industries that were predominantly male or just showing penetration by women, and a much lower proportion was located in the feminized and predominantly female sectors . The growth of female employment was clearly not a response to the expansion of feminized sectors . Women were increasing their representation in relatively male dominated industries and at a rate which denies that they were doing so as non-production/clerical employees . The change is even more dramatic if we take 1970-1979 during which, I have argued, economic and social conditions were conducive to substitution . In this decade more than 40% of the growth of female employment occurred in category A and a further 16% in category B . While analysis of this kind can be criticised as crucially dependent on the original definitions of the categories, especially the choice of the 4 9 which subdivides the diagonal cells, the results shown are quite resilient to minor variation in the definitions adopted . If the interesting comparison is held to be between the share of the increase in working women in categories

EMANCIPATION' OF WOMEN 25

(A and B) and that contained in (D and E) the relatively arbitrary

definitions of the `mixed' category has less of an impact on the results . This analysis can be supplemented by reference to trends in the sex segregation of industrial employment over time . The substitution hypothesis implies a decline in such segregation . A simple index of sex segregation (S) may be obtained by taking one half of the sum of the absolute differences in the percent distribution of male and female employees across industries .' This index has a range from zero (no segregation) to 100 (complete segregation) . A comparison of 1960 and 1979 shows that there has been a reduction in the degree of segregation, S falling from 39 .5 to 31 .9 between these two years . There is one further way in which the analysis of employment growth can cast light on the process of feminization and the expansion of female employment . According to the argument developed above if the rapid expansion in female employment simply reflects labour scarcity, it is to be expected that the bulk of the increase would be in those industries which grew most rapidly in absolute terms . On the other hand if women are substitutes and not just supplements this relationship would be weaker . To test this hypothesis I calculated the rank correlation between growth in absolute employment and share in the increase Table 6 : Unemployment and female share in employment by us industry division Sector Total

Years 1964-79

Mining

1960-79

Construction

1964-79

Manufacturing

1964-79

Transportation

1964-79

Wholesale and retail trade

1%0-79

Finance, Insurance and real estate Service Industry

1960-79

Government

1964-79

1964-79

alpha - 9 .862 ( 5 .151) 9 .523 ( 2 .633) 1 .224 ( 2 .923) -11 .696 (10 .659) -4 .979 ( 3 .123) -8 .664 ( 6 .752) -5 .947 ( 3 .026) -12 .615 ( 5 .534) -11 .436 ( 2 .814)

fl 41 .040 (13 .730) -71 .946 (40 .234) 152 .508 (47 .471) 60 .161 (37 .403) 39 .886 (14 .861) 37 .140 (16 .974) 16 .967 ( 5 .738) 32 .555 (10 .137) 33 .160 ( 6 .534)

R 2 (adj) .346 .103 .383 .096 .293 .166 .290 .383 .623

CAPITAL & CLASS 26

in female employment . Although, as to be expected, there was a strong positive correlation between ranking according to these variables, significantly, from the point of view developed here, it declines over time from .792 for the period 1960-1970 to .742 for 1970-1979. Finally it was suggested above that another indication that substitution is taking place, and that adult male workers are being ejected into the floating reserve as a result, would be a positive correlation between primary male unemployment and female share in employment . I examined this hypothesis by regressing the unemployment rate on female share in employment by industry division over time . There are obviously problems with industry level employment data and although the dependent variable should strictly be male unemployment it was not possible to get US industry specific unemployment data broken down by sex . Although, as is to be expected, the overall explanatory power of the equation was low, the coefficient on the female share was almost always positive and significant as shown in Table 6 . Conclusions

This paper suggests that the existing presentations of the Reserve Army Hypothesis posit a too narrow cyclical interpretation of the use of women as an employment buffer in the context of sexsegregated labour markets . A longer run theorization which links the process of exploitation of a latent labour reserve constituted by married women with the existence, at any one point in time, of sex linked divisions in employment, provides a theory of female proletarianization that is consistent with Marx's own interpretation . The operation of the reserve army is seen as a historically specific mechanism . The particular form of the interaction between women's role as a buffer within the labour force and segregation by sex cannot be predicted a priori but must be seen to depend on the specific historical development of a national economy . It is argued that in the United States conditions are ripe for a substitution of women workers for men . Empirical evidence is used to support the argument . Questions about the nature of the industrial reserve army, and women's role therein, are not mere academic quibbles . The answers have immediate political implications . Anticipation of the likely response of a capitalism in crisis facilitates a coherent and unified defense of the living standards, security and dignity that are undoubtedly at risk . The author would like to thank Jill Rubery, Roger Tarling, Irene Bruegel, Sonia Liff and Sonja Ruehl for comments on an earlier draft of this paper and Francesca Bettio for ongoing discussion of these and related issues.

EMANCIPATION' OF WOMEN 1. For another interesting interpretation of female proletarianization see Beechey (1977) and the critique of Beechey by Anthias (1980) . 2. Milkman's emphasis is on the relatively lower female unemployment rate during the Great Depression although Simeral suggests that a more appropriate test of her hypothesis would have been along the lines subsequently explored by Bruegel and Rubery and Tarling (Simeral, 1978 . p.164) Szymanski's emphasis on relative fluctuations in participation and unemployment rates by sex and the relationship between female participation and the rate of growth of GNP, although not without problems, (see Feminist Theory Collective, 1976) locate him as a forerunner in the Bruegel - Rubery - Tarling tradition . 3. The specification of the relationship is : %f = a + li %t where %f = annual percentage change in female employment and %t = annual percentage change in total employment . See Rubery and Tarling, 1982, p . 73 n .3 . Data is throughout us Department of Labour Statistics . 4. For a parallel analysis of migrant labour in advanced capitalism see Paine (1978) 5. The organization of the working class and in particular the struggle for a `family wage' (extensively discussed elsewhere, see : Humphries 1977 ; Barrett and McIntosh, 1980 ; Land, 1980) were also of immense importance . 6. For examples of relevant micro level studies in the UK context see : Craig, Garnsey and Rubery, 1982 . 7. For a discussion of this kind of analysis in a different context see McAuley, 1981, p . 59 ff. 8. For a complete discussion of this and other measures of segregation see Fuchs, 1975 .

Notes

Applebaum, E . (1981), `Married Women in the American Economy', mimeo, Temple University . Anthias, F . (1980), `Women and the reserve army of labour : A critique of Veronica Beechey', Capital and Class, No .10 . Barrett, M . and McIntosh, M . (1980), `The Family Wage: Some problems for socialists and feminists', Capital and Class, No .11 . Beechey, V . (1977), `Some notes on female wage labour', Capital and Class, No .3 . Benson, M . (1969), `The political economy of women's liberation', Monthly Review, Vol . 21 No .4 . Bruegel, I . (1979), `Women as a reserve army of labour : a note on recent British experience', Feminist Review, No .3 . Bythell, D . (1978), The Sweated Trades : Outwork in Nineteenth Century Britain, Batsford Academic, London . Craig, C, Garnsey E . and Rubery J . (1982), Payment Structures in Small Firms: A study of Sex Differentiation in Employment, Final Reort to the Department of Employment, DAE Labour Studies Group, Cambridge . Currie, E, Dunn, R . and Fogarty, D . (1980), `The New Immiseration :

Bibliography

27

CAPITAL & CLASS 28

Stagflation and the Working Class', Socialist Review, Vol .10 . No .6 . Engels, F . (1962), The Condition of the Working Class in England in 1844, Foreign Languages Publishing House, Moscow . Feminist Theory Collective, (1976), `Comments on Szymanski' Insurgent Sociologist, Vol .6, No .3 . Fuchs, V . (1975), 'A Note on sex segregation in professional occupations', Explorations in Economic Research, Occasional Papers of the National Bureau of Economic Research, Vol .2, No .1 . Humphries, J . (1976), 'Women, Scapegoats and Safety Valves in the Great Depression', Review of Radical Politics Economics, Vol . 8, No . 1 . Humphries, J . (1977), 'Class struggle and the persistence of the working class family', Cambridge Journal of Economics, Vol .1, No .3 . Humphries, J . and Rubery, J . (1981) 'Do we need a supply side of the labour market?' paper given at the Cambridge Journal of Economics Conference on the New Orthodoxy, June . International Labour Organization, (1946), The War and Women's Employment, Montreal . Land, H . (1980), 'The Family Wage', Feminist Review, No .6 Lazonick, W . (1976), 'Industrial relations and technical change : The case of the self-acting mule,' Cambridge Journal of Economics, September . McAuley, A . (1981), Women's Work and Wages in the Soviet Union, George Allen and Unwin, London . Marx, K, (1967), Capital Vol .1, International Publishers, New York. Meek, R . (1971) ed . Marx and Engels on the Population Bomb, Ramparts Press Berkeley, California . Milkman, R . (1976) 'Women's work and economic crisis' Review of Radical Political Economics Vol.8 . No .1 . Mitchell, J . (1971), Women's Estate, Vintage Books New York . Organisation for Economic Co-operation and Development, (1976) The 1974-1975 Recession and the Employment of Women, Paris . Paine, S . (1978), 'The changing role of migrant workers in the advanced capitalist economies of western Europe', Department of Applied Economics, Reprint No .21 Cambridge . Pinchbeck, I . (1%9), Women and the Industrial Revolutions, 1750-1850 . Charles Scribeners' New York . Rubery, J . (1978) 'Structured labour markets, worker organization and low pay', Cambridge Journal of Economics . Rubery, J. and Tarling, R, (1982) 'Women in the Recession', Socialist Economic Review, Merlin . London . Simeral, M . (1978) in Olivia Clark, J . Lembke, B . Marotto (eds .) Essays on the Social Revolutions of Work and Labour : a special issue of Insurgent Sociologist Vol .8 Nos . 2 and 3 . Szymanski, A . (1976) 'The Socialization of Women's Oppression : A Marxist theory of the changing position of Women in advanced capitalist society', Insurgent Sociologist, Vol, 6 . No .2 . Winter Scott, Joan W . and Tilly, Louise A, (1975), 'Women's work and the family in nineteenth century Europe' in The Family in History edited by Charles Rosenberg, University of Pennsylvania Press, Philadelphia . us Department of Labour, (1979), Employment Projections for the 1980s Bureau of Labour Statistics, Bulletin 2030 June .

Deborah Fahy Bryceson

Use values,the law of value and the analysis of non-capitalist production The law of value is the core of Marxist theory . When the fundamental basis of the law of value is conceived as a'marketmediated labour' theory of value rather than a general labour theory of value subject to historical specification, a rigorous analysis of non-capitalist production is virtually precluded . This article relying on Marx's materialist method rather than his designation of the operation of the law of value solely to commodity production and capital, contends that the law of value provides the conceptual framework for restructuring an understanding of societal allocation of labour under all modes of production. It is argued that the law of value has noncapitalist regimes of operation which can only be recognized by reformulating the meaning of the term `use value' and sharpening the analytical distinction between the terms `value' and `exchange value' . This exercise opens up analytical vistas for the understanding of non-capitalist modes of production . Today's Third World material transformation is frequently accompanied by spasmodic, crisis-ridden social upheaval . From an analysis grounded in the law of value there is more likelihood that, political action and policy formulation capable of effecting unified material and social transformation can emerge .

29

CAPITAL & CLASS

30 Use values and social production

'Labour . . . as the creator of use values, as useful labour, is a condition of human existence which is independent of all forms of society ; it is an eternal natural necessity which mediates the metabolism between man and nature, and therefore human life itself .' (Marx 1976, Capital Vol . II, p . 133) In Marx's work use value production is characterized as natural rather than social . It will be argued in this article that Marx's position contains some ambiguities which cast uncertainty over his view of use value . Most significantly, these ambiguities pose an impediment to the theoretical understanding of non-capitalist societies . Marx identifies the operation of the law of value with commodity production . In fact, he argues that the law of value does not fully assert itself until commodity production becomes generalized under the capitalist mode of production . The law of value is depicted as a process whereby the social equivalence of commodities is effected on the basis of the labour time embodied in them . Commodities are defined as exchanged products having use values . Recently controversy has arisen over the validity of Marx's theory of value . The challenge comes from a neo-Ricardian position exemplified in the work of Steedman (1977) . Steedman argues for the derivation of both prices and values from the concrete level of physical conditions of production under capital . This relegates the law of value as Marx conceptualized it to a superfluous status, since the abstract level of analysis advanced by Marx is completely omitted . Critiquing Steedman, Ganssmann (198 1) demonstrates the over-simplification involved in conflating the abstract and concrete levels of value theory . Ganssmann argues that the existence of money and other fundamental aspects of the market and value realization under capital have to be ignored to accept Steedman's position . While not denying inconsistencies in Marx's formulation of the law of value, Ganssmann rejects Steedman's position as an alternative. This article approaches the law of value from a different angle by focussing on the nature of use value . While the emphasis is shifted somewhat to one side of current controversy over the nature of exchange value and price, the discussion of use value does however function to throw some contentious issues in new relief. Contrary to Steedman's denial of the theoretical utility of Marx's law of value, this article will maintain that there is a strong case for not only accepting the law of value but also extending its theoretical application to non-capitalist, non-commodity production . To do so however requires the removal of certain internal inconsistencies in Marx's original formulation of the law to allow

USE VALUES for a re-interpretation of the positioning of various theoretical categories within the law's respective concrete and abstract levels of analysis . It is somewhat ironic that the value controversy has centered solely around the issue of value realization under capital . After all, at present, developed capitalist social formations physically occupy a relatively small part of the globe . The majority of the world's population today are still peasants . With the proliferation of anthropological data collection since the time when Marx was writing and with vastly improved transport and communications between countries throughout the world, there is little justification for maintaining capital as the reference point to which all social phenomena are made to relate in Marxist analysis . Spatially limited and temporally bounded, capital's impact has to be kept in perspective . The capitalist mode of production only began to be formed in the late 15th century . Thus, at the very most, capital has been exerting a force over the past 500 years, before that stretch millennia of human existence when use value production for the most part determined the material conditions of human populations . If one views Marxism as a materialist methodology capable of theoretical expansion and elaboration as configurations of the numerous and diverse societies of the past and present come to light, then this capital-centric interpretation of the law of value gives cause for concern . Literal adherence to the given body of terminology and polemics found in Marx's writings would lead one to accept that the production of use values is solely `natural' prior to the onset of commodity production . And indeed if this were the case, forms of use value production in pre-capitalist societies would have to be seen as spontaneous reactions to the natural environment, a part of instinctual behaviour . The productive groupings of men and women and the behavioural patterns found therein would have to be interpreted as innate responses to the particular natural habitats being occupied rather than men and women's intelligent attempts to adapt to or control nature for the provisioning of their needs . If all this were the case, then an axiomatic question suggesting itelf is : how did humans break out of a state of biological determinism to become social beings who were to a large extent determining rather than determined by the physical environment? The study of physical anthropology would be pivotal to Marxism . While recognizing that physical anthropology is a relevant area of study, nevertheless, what is being argued here is that the concerns of physical anthropology do not directly arise in the transition from pre-commodity to commodity producing societies . The transition from ape to man precedes the transition from

31

CAPITAL & CLASS 32

pre-commodity to commodity producing societies by millions of years . In positing use value as `natural' Marx overstates the distinction between capitalist and non-capitalist modes of production . The capitalist mode of production affords continuous, self-expanding production and greater control over nature relative to pre-capitalist modes, but this is not sufficient grounds for asserting that it alone is socially conditioned whereas noncapitalist, non-commodity producing societies are not . Noncapitalist modes cannot be considered pristine `natural economies' . They are socially conditioned as well . The fundamental biological needs of human existence must be provided by material production in any and all modes of production . However, in all modes, biological need is socially defined . In this regard it would be highly mistaken to consider that the capitalist mode has superceded environmental constraints or biological necessity, but as with all modes it is the social form and content these biological aspects take which are significant for a materialist understanding . Modes of production represent socially conditioned systems of producing historically defined needs . Use value production has to be seen in this light . In what follows, a plea for the heightened awareness of the qualitative not just quantitative aspects of value formation and realization is made (Sweezy 1979 : 2, Bradby 1982 and de Vroey 1982) . The argument developed by Ricardo, Sraffa and most recently, Steedman `suppresses the relationship between subjects (at once producers and consumers) and objects (at once products and useful goods)' and instead focusses on the inter-relationship between the objects themselves (Napoleoni 1978 :76) . When endeavours to understand the changing configuration of social relationships between subjects vis-a-vis the objects they produce are forsaken, why and how the objects were produced by subjects will remain unexplained . The article is divided into three main sections . The first presents Marx's own interpretation of the nature and operation of the law of value, pointing to various inconsistencies in his line of argument . Secondly, a revised interpretation of the law of value will be presented pivoting on a re-definition of `use value' as a phenomenal form of social value production . In the process so-called `natural economies' will be re-evaluated in light of the social rationality of use value production . Thirdly and finally, the practical implications of the theory of non-capitalist regimes of the law of value will be drawn in light of current Third World development policies .

USE VALUES Marx defines use value as the usefulness of a thing independent of the amount of labour required to produce it (Capital Vol . 1, p .126) . In commodity producing societies, use values become the material depositories of exchange value (Vol . I, p . 126) . Use values are realized through consumption . Exchange values are realized through exchange . Value is objectified abstract human labour congealed in commodities (Vol . I, p . 129) . Exchange value is the phenomenal form of value . Labour is the valueforming substance (Vol. 1, p .129) . The magnitude of value is determined by the labour time socially necessary for its production (Vol . I, p . 129) . The following basic premises can be extracted from Marx's writings on value which serve to highlight the inter-relationship between the various key terms : value, use value, exchange value and abstract labour . Abstract labour is value . Value is abstract labour . Therefore by definition value is abstract labour and vice versa . All exchange values express value . All values are expressed by exchange value . Therefore exchange value and value denote the same essence : abstract labour . All values have use value . All exchange values have use value . Therefore use value is a necessary condition for the existence of value and exchange value . Not all use values are a product of human labour . Not all use values are a product of abstract human labour . Not all use values have value . Not all use values have exchange value . Therefore value and labour are not necessary conditions for the existence of use value . Abstract Labour is value . Value is abstract labour Therefore value is abstract labour and vice versa . The first premise defining value as abstract labour is the fundamental basis upon which Marx posits the social nature of value formation . Abstract labour is market-mediated labour . The market is a social institution which serves to place commodities relative to one another by quantitative measurement in c.

6 C . 20-C

Marx's Law of Value

33

CAPITAL & CLASS 34

terms of monetary prices . The producer and consumer confront each other over the buying and selling of these commodities . When the commodities are put in competition with one another for sale in the market, a process of social averaging of labour time takes place . In the capitalist mode, a still higher level of social averaging takes place through the credit market of the banking system . Different branches of industry with various profit rates compete with one another for credit, which in turn influences the structural development of capitalist production and the achievement of higher levels of productivity . Abstract labour is intrinsically bound up with the social institutions of the market and more latterly the capitalist banking system . Since the law of value is seen as coming into operation with the development of commodity production and not wage labour per se, abstract labour does not necessarily have to be associated with labour power as a commodity under capital . What is the precise distinction between `labour' and `abstract labour'? Sometimes Marx was known to slip into not making any distinction between the two such that it was inferred that abstract labour could be equated with labour . `Value is labour' (Capital Vol . III, p . 815) Marx affirmatively wrote . The merger of the meanings of labour and abstract labour would perhaps be more conducive to Marx's position regarding use value production as the basis of the social division of labour `The totality of heterogeneous use values or physical commodities reflects a totality of similarly heterogeneous forms of useful labour, which differ in order, genus, species and variety ; in short a social division of labour .' (Capital Vol . I, p . 132) An advanced social division of labour is a necessary precondition for commodity production . In other words, the evolution of use value production lays the basis for the development of commodity production in which abstract labour appears, however it is significant to note that long before the development of commodity production social divisions of labour based on use value production existed . The pre-commodity producing social divisions of labour were moulded and perpetuated by social institutions : systems of reciprocity, prestation, coercive force, barter and preceding that, socially ascribed rituals and socially shared notions of common sense transmitted from generation to generation . These social institutions have the same productive and reproductive function as the market and banking system which mould and perpetuate the capitalist division of labour . The market and the banking system, however, do afford more advanced means of socially averaging labour time in comparison with the social institutions

USE VALUES of pre-commodity producing societies . Engels alludes to this in the supplement to Volume III of Capital: ' . . . the peasant of the Middle Ages knew fairly accurately the labour-time required for the manufacture of the articles obtained by him in barter . The smith and the cart-wright of the village worked under his eyes ; likewise the tailor and shoemaker . . . People in the Middle Ages were thus able to check up with considerable accuracy on each other's production costs for raw material, auxiliary material, and labour time - at least in respect of articles of daily general use . But how, in this barter on the basis of quantity of labour, was the latter to be calculated, even if only indirectly and relatively, for products requiring longer labour, interrupted at irregular intervals, and uncertain in yield e .g. grain or cattle? And among people, to boot, who could not calculate? Obviously only by means of a lengthy process of zigzag approximation, often feeling the way here and there in the dark, and, as is usual, learning only through mistakes . But each one's necessity for covering his outlay on the whole always helped to return to the right direction ; and the small number of kinds of articles in circulation as well as the often century-long stable nature of their production, facilitated the attaining of this goal .' (Capital Vol . III, pp . 897-98) Barter systems are not the only institutions which serve to rationalize labour time in an approximate fashion . Systems of prestation and reciprocity, for example, have to be finely tuned to avoid imbalancing the social work effort in such a way that the society's productive base could not adequately be maintained . Even socially-held common sense notions regarding production must be founded on fairly accurate estimates of labour time expenditure, otherwise the ultimate survival of the producers could be jeopardized . Thus the social rationalization of labour time is not unique to commodity production . It is true that the market does represent a notable advance over pre-commodity producing institutional mechanisms for commensurating labour time, but this does not provide the grounds to argue that market mediated exchange value production is `social', whereas use value production mediated by the institutions of pre-commodity producing societies is `natural' . Marx stipulates that labour is both the value forming substance and the creator of use values . In other words, labour creates exchange values and use values . Yet, Marx writes if `we disregard the use value of commodities only one property remains that of being products of labour' (Capital Vol . I, p . 128) . This would seem to imply that the labour that creates value and the

35

CAPITAL & CLASS 36

labour which creates use values can be set apart rather than being one and the same . The same problem of isolating useful labour from valuecreating labour arises in Marx's distinction between `labour' and `labour power' . Marx states that : ' . . . labour as the value-forming element cannot itself possess any value, and so a certain quantity of labour cannot have a value that is expressed in its price . . . ' (Capital Vol . II, p . 113) . What is implied is that we can only speak about the value of labour power, not labour per se and the `value of labour power is determined by the value of the means of subsistence habitually required by the average worker' (Capital Vo . I, p . 655) . Thus, the expenditure of labour power creates labour . Labour creates value . The value of labour power is the historically determined means of subsistence . Is use value production irrelevant to the nature of value formation embedded in the expenditure of labour power? Marx is extremely ambiguous on this point . One finds within a few pages of Chapter I, Volume I of Capital a stark contradiction . `If we leave aside the determinate, quality of productive action, and therefore the useful character of the labour, what remains is its quality of being an expenditure of human labour power .' (Capital Vol . I, p . 134) ' . . . all labour is an expenditure of human labour power in a particular form and with a definite aim, and it is in this quality of being concrete useful labour that it produces use values .' (Capital Vol . I, p . 137) How can useful labour be completely isolated from the expenditure of human labour power when all expenditures of human labour power are by their very nature use value producing? The signficance of the distinction Marx makes between labour and abstract labour becomes even more problematic when Marx reveals that the site of value creation and the site of value realization are not one and the same, as evidenced in the following passage : `It becomes plain that it is not the exchange of commodities which regulates the magnitude of their values, but rather the reverse, the magnitude of the value of commodities which regulates the proportion in which they exchange .' (Capital Vol . I, p . 156) The magnitude of value is determined by the amount of socially necessary labour time expended . Socially necessary labour time is defined as `labour time required to produce any use value under the conditions of production normal for a given society and with the average degree of skill and intensity of labour prevalent in that society' (Capital Vol . 1, p . 129) . Thus socially necessary

USE VALUES labour time is intimately associated with the production of use values . So too, Marx acknowledges that the common element of use values is labour time (Grundrisse, p . 269) . What has to be deduced from the above is that labour becomes abstract labour through market mediation but actual value formation takes place before exchange value is realized in the market . And if this is true, surely, use value production is part and parcel of value formation . This is seemingly borne out in the following passage : ' . . . commodities possess an objective character as values only in so far as they are all expressions of an identical social substance, human labour, that their objective character as values is therefore purely social .' (Capital Vol . I, p . 138) Since use value production embodies the social substance, human labour, the resultant use values must logically have an objective character as values that are as purely social as exchange values . Before moving on to the second set of premises which focuses on exchange value, it should be re-iterated that Marx's usage of the terms `labour', `abstract labour' and `labour power' reveals ambiguities which have repercussions on the meanings of the terms `value', `use value' and `exchange value' . It has been argued in the above that the distinction Marx posits between labour and abstract labour can be misleading . What distinguishes abstract labour from labour is that abstract labour is labour that is market-mediated. To the degree that Marx seems to make the features of being social, objective and value-creating synonymous with market mediation, this leads to a false contrast between labour and abstract labour, in which abstract labour alone can give rise to value . It will be argued in more detail in what follows that labour encompasses both `abstract' and `concrete' labour . `Concrete' labour creating use values is as social, objective and value-creating in nature as `abstract' labour, the only difference being that it is mediated by social institutions other than the market . Throughout the remainder of this article, `abstract' and `concrete' labour will continue to appear in inverted commas . In this way, the conventional terminology is retained, but with the proviso that they designate market-mediated labour and consensual labour respectively and should not be confused and identified with abstract and concrete levels of analysis . All exchange values express value . All values are expressed by exchange value . Therefore exchange value and value denote the same essence: abstract labour.

37



CAPITAL & CLASS 38

It should be mentioned here that Marx held that commodities had two forms : use value being their natural form and exchange value, their value form . In this way exchange value came to be conceived as the phenomenal form of value . What does exchange value as the phenomenal form of value imply? According to the dictionary, to be phenomenal is to be observable . However, exchange value is not directly observed, rather price is the observable expression of exchange value . Price, therefore, is a concept inextricably linked with exchange value . Price, as the expression of exchange value, is only possible with the existence of the universal equivalent, money . Often `exchange value' becomes submerged in the dis-

Table 1 : Marx's Theory of Value Formation and (traced with reference to a single commodity)

Value Realization

The Abstract Concepnwl Level: Value (socially necessary labour time)

VALUE FORMATION (in production) Labour (Dead and Living)

cycle repeated

The Concrete Conceptual Level : It' _ (c + v)' (a) b eginning of_* Capital Investment commodity's reproductive cycle

Commodity's Exchange Value (c + v + s)' (b)

k' _ (c + v)' Capital Reinvestment Credit from Banking I Capital Turnover System (g) I VALUE RATIONALIZATION

VALUE REALIZATION (in circulation)

I



Price of Production ~_ Market Selling Price .4 (definedin termsof [+/-(c+v+a)['(c) commodity's specific branch of industry) (d) s 7 Rate of profit: [c['+[vl'+ WE[c+ VI (e)

I

General rate of profit p'=

174-v J s N

p

s = lc+ vI I

Rate of surplus value extraction

s'=1

v

I ,

(I)

TOTAL EXCHANGE VALUE of all capitalist producers realized in any one cycle of value formation is : C + V + S = Total market selling price of all commodities

r, [+/- (c + v + s)[

s [c + v N = C + V + P (because Total Profit = Total Surplus Value) i .e. p = [+/- (s)[ = Total prices of production

r, [c] + Fe 1'] +vkF

- Cost Price k'=(c+v)'

USE VALUES cussion of price . The `transformation problem' is about how value embodied in commodities corresponds to price . Marx differentiated price into various levels of formation : first, the cost price of the commodity at the factory gate ; secondly, the market selling price giving rise to capitalist profit ; and thirdly, prices of production mediated through the national banking system, the level at which an average general profit rate appears . Exchange value is realized at the second level of price formation, that is in the market . Another rather confusing aspect of value theory is that `exchange value' is often used interchangeably with the term `value' . The problem is not helped by the fact that Marx himself

Notes to table 1 :

a - Superscript number demarcates the specific round of the cycle, and letters denote : k - capital investment, c - constant capital, v - variable capital, s - surplus value, p _profit . b - (s) represents a potential value which through the realization of value in the market will be quantified as [s] . The exchange value of a commodity is : c+v+s=c+v+kP' which can be greater or less than both the commodity's market selling price and its price of production . c - [ ] brackets demarcate the realized exchange value of the post-sale commodity d - to define a commodity's price of production relative to the average profit rate prevailing in its specific branch of industry rather than relative to the average general profit rate is a departure from Marx's method of calculating prices of production . However, in doing so one very major inconsistency in Marx's work is removed, namely that by defining prices of production as `the prices which obtain as the average of the various rates of profit in different spheres of production added to the cost-prices of the different sphere of production' (Capital Vol III, pI57) and then stating that `the price of production of commodities produced by the average capital coincides with their value' (Vol III p200), one would be led to deduce that all prices of production coincide with their respective values since the commodities' prices of production contain the general rate of profit arrived at by averaging the returns on the total social capital (Vol III, pp162-163) . And if so, it is a contradiction in terms for Marx to discuss the deviation of prices of production from their values (Vol III, p164) . Such a discussion only makes sense if prices of production are calculated as the cost prices and average of profit within the various spheres of production (or branches of industry) . Then a commodity's price of production as well as its market selling price can deviate from its value (ie the average socially necessary labour time needed to produce it) . e - n = total number of commodities of the specific branch of industry sold in the cycle. f - N = total number of commodities in all branches of industry sold in the cycle . g - The commodity's price of production as well as the ratio of the commodity's price of production to its market selling price are instrumental in determining the capitalist producer's access to credit for the banking system .

39

CAPITAL & CLASS 40

in Volumes II and III constantly refers to value rather than exchange value when tracing the commodity, productive and money circuits of capital . This is not in keeping with his highly critical stance on the vulgar labour theory of value held by the classical economists like Smith and Ricardo who equated exchange value with value . . . Adam Smith . . . confuses his determination of value by the quantity of labour expended in the production of commodities with the determination of the values of commodities by the value of labour, and therefore endeavours to prove that equal quantities of labour always have the same value .' (Capital Vol . I, p . 137) Marx's theory of value in the main does not posit a one-toone correspondence between the value embedded in the commodity and its exchange value . Rather Marx's `value' is an abstract category denoting labour as the element common to all commodities at an aggregate level rather than the labour embedded within each specific commodity . Marx's theory of value could be schematically summarized as Table 1 . Having noted that in Marx's writings exchange value does however often lose its analytical identity to value, on the one hand, or price on the other, the question is, does it really matter? Elson (1979) and Banaji (1979) who emphasize that Marx employed a dialectical logic rather than a mathematical logic would appear to be implying that such analytical imprecision is part and parcel of Marx's method of analysis . As Elson argues: `Going inside the form is achieved by treating it as the temporary precipitate of opposed potentia ; what Thompson calls a moment of becoming, a moment of co-existent opposed possibilities, "double-edged and double tongued" (Thompson 1978, p . 305-6) . But these opposed potentia are not discretely distinct building blocks ; rather they are different aspects of the continuum of forms in process, they share a continuity as well as a differenced .' (p .142) Elson further explains : `It is taken for granted, in this method, that the world has a material existence outside our attempts to understand it ; and that any category we use to cut up the continuum of the material world can only capture a partial knowledge, a particular aspect seen from a certain vantage point . This is explicitly recognised in the discussion of method in the 1857 Introduction: `for example, the simplest economic category, say e .g. exchange value, pre-supposes population, moreover a population producing in specific relations, as well as a

USE VALUES certain kind of family, or commune, or state, etc . It can never exist other than as an abstract, one-sided relation within an already given, concrete, living whole." (Marx 1857 Introduction, p . 101)' (Elson 1979, p . 145) Two very important issues arise from the above quotations : first, the nature of analytical categories and their relationship to reality ; and secondly, the particular analytical status of `exchange value' . As regards the first issue Elson appears to be arguing that the dialectic in process can be reflected in tfe construction of analytical categories, which would undoubtedly result in one category merging into the next . However, by trying to simulate real processes in the conceptual constructs themselves there are two dangers : either of creating imprecision and confusion or more serious, falling into the metaphysical teleologies of Hegel . Marx recognized the latter danger : 'Hegel fell into the illusion of conceiving the real as the product of thought concentrating itself, probing its own depths, and unfolding itself out of itself, by itself, whereas the method of rising from the abstract to the concrete is only the way in which thought appropriates the concrete, reproduces it as the concrete in the mind . But this is by no means the process by which the concrete itself comes into being .' (Grundrisse p . 101) Although Marx generally avoided the metaphysical teleologies of Hegel, the haziness of what Elson identifies as the dialectic in Marx's construction of the conceptual categories of value and exchange value is open to misinterpretation . Any reader who perceives an emphasis on continuity rather than on difference between the two categories would be in the position of affirming the Ricardian labour theory of value . Marx's designation of the category `exchange value' is in itself not always consistent . Marx defines `exchange value' as the phenomenal form of value . Obviously, this would lead one to think that the category denotes concrete phenomena, yet in the above quote from the 1857 Introduction we are told that the category actually denotes `an abstract, one-sided relation .' In unravelling the confusion it is necessary to distinguish the concepts from the aspects of the real world they denote . If `value' represents an unobservable social phenomenon i.e . labour embedded in social commodity production, while `exchange value' represents an observable phenomenon, namely, the actual social form of that labour in terms of an equivalent of some magnitude, then it would appear that value is an abstract category and exchange value is a concrete category . This would not deny that in reality what exchange value denotes actually derives from

41

CAPITAL & CLASS 42

what value signifies since concrete categories denote the observable embodiments of the conceptually isolated elements signified by abstract categories . The following quote from Marx clarifies this : `The concrete is concrete because it is the concentration of many determinations, hence unity of the diverse . It appears in the process of thinking, therefore, as a process of concentration, as a result, not as a point of departure, even though it is the point of departure in reality and hence also the point of departure for observation and conception .' (Grundrisse, p . 101) In summary, it is important that `value', `exchange value' and `price' retain their individual analytical identities . The recognition of the separation between the abstract and concrete levels of analysis represented by the two terms value and exchange value is imperative, otherwise a vulgar interpretation of Marx's labour theory of value is inevitable . As for the significance of the analytical distinction between `exchange value' and `price', this will become evident in the discussion of the third and fourth sets of premises . All values have use value . All exchange values have use value . Therefore use value is a necessary condition for the existence of value and exchange value . Marx's contention that all values have use value and all exchange values have use value relates to use value being the natural form of the commodity . As has already been stated, exchange value is considered to be the value form of the commodity . Exchange value is portrayed as being a derivative of value whereas use value is considered as lying outside of either value or exchange value but providing a necessary condition for their existence . There is, however, a problem with this schema . It would appear that use value as a necessary condition for value (an abstract category) and exchange value (a concrete category), would have to be both an abstract and concrete category to accommodate itself to this task . As has been argued in the previous section, a category cannot be both . Use value has to be designated as either an isolated abstract element or a concrete embodiment of such isolated elements . Since the realization of use value comes through human consumption, a concrete instance, similar to the realization of exchange value through market sale, another concrete instance, it would appear that `use value' is a concrete category . As a concrete category it would

USE VALUES share the same analytical status as exchange value, i .e . it would be the other phenomenal form of value . Marx was known to toy with the idea of use value as a form of value but rejected it as revealed in the following passage : `Is not value to be conceived as the unity of use value and exchange value? In and for itself, is value as such the general form, in opposition to use value and exchange value as particular forms of it? Does this have significance in economics? Use value presupposed even in simple exchange or barter . But here, where exchange takes place only for the reciprocal use of the commodity, the use value, i .e . the content, the natural particularity of the commodity has as such no standing as an economic form . Its form, rather, is exchange value . The content apart from this form is irrelevant ; is not a content of the relation as a social relation . But does this content as such not develop into a system of needs and production? Does not use value as such enter into the form itself, as a determinant of the form itself, e .g. in the relation of capital and labour? the different forms of labour? - agriculture, industry etc . ground rent? - effect of the seasons on raw product prices? etc . If only exchange value as such plays a role in economics, then how could elements later enter which relate purely to use value, such as, right away, in the case of capital as raw material etc? How is it that the physical composition of the soil suddenly drops out of the sky in Ricardo? The word ware (commodity) German Guter (goods) perhaps as denree (good) as distinct from merchandise (commodity?) contains the connection . The price appears as a merely formal aspect in it . This is not in the slightest contradicted by the fact that exchange value is the predominant aspect . But of course use does not come to a halt because it is determined only by exchange : although of course it obtains its direction thereby . In any case, this is to be examined with exactitude in the examination of value, and not, as Ricardo does, to be entirely abstracted from, nor like the dull Say, who puffs himself up with the mere presupposition of the word "utility" . Above all it will and must become clear in the development of the individual sections to what extent use value exists not only as presupposed matter, outside economics and its forms, but to what extent it enters into it . Proudhon's nonsense, see the "Misere" . This much is certain : in exchange we have (in circulation) the commodity - use value - as price ; that it is, apart from its price, a commodity, an object of need, goes without saying . The two aspects in no way enter into relation with each other,

43



CAPITAL & CLASS

except in so far as the particular use value appears as the

44

natural limit of the commodity and hence posits money, i .e . its exchange value, simultaneously as an existence apart from itself, in money, but only formally . Money itself is a commodity, has a use value for its substance .'

(Grundrisse, pp . 267-68) In this quote it has been asserted that use value is not an economic form, nor a social relation . It is merely a presupposition, a natural limit and `an object of need, goes without saying .' But can it go without saying? Use value, the object of human need is far from a natural given, as Marx himself so vividly argues : `Hunger is hunger, but the hunger gratified by cooked meat eaten with a knife and fork is a different hunger from that which bolts down raw meat with the aid of hand, nail and tooth . Production thus not only produces the object

Table 2 : The Inter-Relationship between Abstract and Concrete Value Categories

Abstract Categories: Objective Social Labour

1 Value

Concrete Categories :

4 Forms of the Product of Labour

Forms of Labour

Producer or Consumer Good

l Commodity

`Abstract' Marketmediated Labour

`Concrete' Consensual Labour

V Exchange Value

Phenomenal Value Forms

Use Value

Social Expressions of Value Forms

Historically Defined

Price

Necessary Preconditions for Realization of Value forms

Universal Survival Requirements (food, drink, shelter, etc .)

Universal Equivalent (money)

l 1d

1 1

USE VALUES but also the manner of consumption, not only objectively but also subjectively. Production thus creates the consumer . Production not only supplies a material for the need, but it also supplies a need for the material .'

(Grundrisse, p . 92) While acknowledging the economic character of needs above, Marx was also conscious of the historical and social character of needs as evidenced in observations he made regarding workers' necessary means of subsistence . `The actual value of his (the worker's) labour-power deviates from this physical minimum ; it differs according to climate and level of social development ; it depends not merely upon the physical, but also upon the historically developed social needs, which become second nature .' (Capital Vol . III, p . 858) And in no uncertain terms Marx writes : ` . . . to say that a commodity has a use-value is merely to say that it satisfied some social want .' (Capital Vol . III, p . 185) (my emphasis) Having argued that use values are historically and socially rather than naturally determined, and that their realization takes place in the concrete instance, it would seem justified to consider them as phenomenal forms of value on a par with exchange value, insofar as they are products of labour . Table 2 attempts to clarify this . The necessity for distinguishing price as the expression of exchange value can be seen when juxtaposed to the distinction between need as an expression of use value and use value itself. Needs presuppose universal biological requirements just as prices presuppose money as the universal equivalent ; without these conditions they could never express their respective value forms, but it is important to note that neither needs nor prices are naturally given . Price levels and the content of needs vary over time and place . They are socially determined by the mode of production . Through processes of social determination, the phenomenal forms of value come to represent the forms of social realization of value embodied in the product of labour . Use value is the concrete qualitative value form of the product of labour realized through consumption whereas exchange value is the concrete quantitative value form of the product of labour realized through market sale . How is the above conception of use value in contradiction with that of Marx? The contradictions become obvious in considering the fourth set of of premises .

45

CAPITAL & CLASS 46

ACADEMIC PRESS CONTRIBUTIONS TO POLITICAL ECONOMY

Editors John Eatwell Murray Milgate Giancarlo de Vivo

This annual publication publishes articles on the theory and history of political economy which fall broadly within a critical tradition in economic thought and are associated with the work of the old classical economists, Marx, Keynes and Sraffa . An important function of the journal is to review the more important books published in the preceding year, the subject matter of which falls within the scope of the journal . Contributions to Political Economy can be obtained either by means of a joint subscription with the Cambridge Journal of Economics or separately . A reduced rate is available to subscribers purchasing both journals. Contents of Volume 1 R . Tarling and F . Wilkinson : The movement of real wages and the development of collective bargaining in the U .K. : 1855-1920 . D. J . Harris : Structural change and economic growth . A review article . J . Robinson : The current state of economics . P . Groenewegen : Thomas De Quincey : 'Faithful disciple of Ricardo?' . R . Green : Money, output and inflation in classical economics . G. de Vivo : Notes on Marx's critique of Ricardo . Contents of Volume 2 K. Bharadwaj : Ricardian theory and Ricardianism . J .A . Clifton : Administered prices in the context of capitalist development . G . Vaggi : The physiocratic theory of prices . Publication: one issue per year (March) Subscription : Volume 2, 1983 Full Rate: £8.50 (UK)/$23.00 (overseas) *Personal Rate : £7 .00 (UK)/$18.00 (overseas) Combined subscription rate for Cambridge Journal of Economics and Contributions to Political Economy Full Rate : £30 .00 (UK) $79 .00 (overseas) *Personal Rate : £18.00 (UK) $45 .00 (overseas) *Personal subscription rates are available only on orders placed directly with the Publisher and paid for out of personal funds

24-28 OVAL ROAD, LONDON, NW1 7DX 111 FIFTH AVENUE, NEW YORK, NY 10003, USA

USE VALUES Not all use values are a product of human labour. Not all use values have value . Not all use values are a product of abstract labour . Not all use values have exchange value . Therefore value and labour are not necessary conditions for the existence of use value . Marx asserts that a use value can exist without being a value or a product of labour in the following passage . `A thing can be a use-value without being a value . This is the case whenever its utility to man is not mediated through labour . Air, virgin soil, natural meadows, unplanted forests, etc . fall into this category .' (Capital Vol . I, 131) These two sentences perhaps more than any other Marx wrote transgress his overall theory of value . True, a thing can have utility without being a value but why call utility a use value? Surely use value is a misnomer in this case . Otherwise Marx is giving credence to the most fundamental axiom of neo-classical economics : utility defined as a value-creating element in itself . Kay (1979 :50) recognized Marx's agreement with the neo-classical economist Bohm-Bawerk on this point . According to Marx's theory of value, labour is the only value creating element . It is a very serious oversight not to have recognized that virgin soil, unplanted forests etc . only have the potential of becoming use values, and this potential depends on the degree to which it is anticipated that at some future date they will be the object of labour . Hence value always denotes past or present labour at the aggregate level while the possibility or inevitability of labour being applied to a natural resource or other given substance lends these things the potential of realizing use value . However, without the actual or anticipated application of labour they cannot be considered the depositories of use value any more than they could be considered the depositories of exchange value . Why did Marx allow such a serious inconsistency to creep into his theory? The problem again can be traced to Marx's confusion regarding the role of nature in determining precapitalist modes of production . Dichotomizing use value as naturally ordained and exchange value as socially created, Marx distinguishes `concrete' useful labour from `abstract' labour . Under commodity production use values become nothing but a back-drop to value and exchange value whereas under pre-commodity production use values exist in the absence of `abstract' labour and exchange value . Having already pointed out some of the logical inconsistencies in this view, the following attempts to explain why

47

CAPITAL & CLASS 48

Marx edged himself into such an untenable theoretical position . Marx's confusion regarding the role of nature in determining pre-capitalist modes of production unfolds in his polemic against Ricardo . Ricardo had argued that production and production relations were natural whereas distribution and distribution relations were social and historical in form and content . Marx maintained that both production and distribution were social under capital, yet due to what can only be interpreted as ignorance or Victorian prejudices he fell into believing that production in pre-commodity producing societies was `natural' . For example, Marx had no appreciation of the social nature or technical know-how of production in hunting and gathering societies . `If we think back to the beginnings of society we find no produced means of production, hence no constant capital, the value of which could pass into the product, and which, in reproduction on the same scale, would have to be replaced in kind out of the product and to a degree measured by its value . But Nature there directly provides the means of subsistence, which need not first be produced . Nature thereby also gives to the savage who has but few wants to satisfy the time, not to use the as yet non-existent means of production in new production, but to transform, alongside the labour required to appropriate naturally existing means of production, other products of Nature into means of production : bows, stone knives, boats, etc .' (Capital Vol . III, 847-48) Marx's notion of the `natural economy' is founded on the belief that : ' . . . the original conditions of production appear as natural presuppositions, natural conditions of the producer's existence just as his living body, even though he reproduces and develops it, is originally not posited by himself, but appears as the presupposition of his self . . . '(Grundrisse, 489-90) Thus, Marx depicts the natural economy as a society in which nature is directly appropriated . In arguing against Proudhon he writes : `It is not the unity of living and active humanity with the natural inorganic conditions of their metabolic exchange with nature, and hence their appropriation of nature, which requires explanation or is the result of a historic process, but rather the separation between these inorganic conditions of human existence and this active existence, a separation which is completely posited only in the relation of wage labour and capital .' (Grundrisse, 489) Interestingly from Grundrisse through Capital, Marx

USE VALUES generally held that pre-commodity production was natural, however, in the second to the last chapter of Capital Vol . III in concluding his polemic against Ricardo Marx seems to be making an advance towards accepting pre-commodity production as social and historical rather than merely natural . `The so-called distribution relations, then, correspond to and arise from historically determined specific social forms of the process of production and mutual relations entered into by men in the reproduction process of human life . . . the view which regards only distribution relations as historical, but not production relations, is, on the one hand, solely the view of the initial, but still handicapped criticism of bourgeois economy . . . it rests on the confusion and identification of the process of social production with the simple labour-process, such as might even be performed by an abnormally isolated human being without any social assistance . To the extent that the labour-process is solely a process between man and Nature, its simple elements remain common to all social forms of development . But each specific historical form of this process further develops its material foundations and social forms . Whenever a certain stage of maturity has been reached, the specific historical form is discarded and makes way for a higher one .' (Capital Vol . III, 883) If this is the case then Marx's entire argument setting forth the so-called `natural economy' in Grundrisse is contradicted, and the premise that use values do not result from value production is set adrift .

In the course of reviewing Marx's premises on value a re-ordering of the inter-relationship between value categories has been suggested to accommodate the redefinition of use value as a phenomenal form of value . It remains to emphasize a few methodological points and present the re-odering of categories as a summarized totality before briefly discussing the practical implications of this theory for Third World development policies in the final section . The Method of Abstraction

Marx explicated his methodology here and there throughout his works . One of this most detailed discussions about methodology appears at the beginning of Grundrisse (pp . 100-8) . In it he explains his method of abstraction . As has already been mentioned, Marx conceived of abstract categories as those C. & C . 20-D

49

Redefining Use Value and the Law of Value

CAPITAL & CLASS 50

which isolated single determinations whereas concrete categories contained many determinations . Side by side with the abstract/ concrete categorical distinctions came general and specific categories . General categories were those that pertained transhistorically, while specific categories were those pertaining to particular modes of production . The category `simple' referred to a potentially abstract category which had not reached its full or purest expression in the concrete . Bearing these distinctions in mind one can trace Marx's development of the category `labour' : Labour seems a quite simple category . The conception of labour in this general form - as labour as such - is also immeasurably old ." (Grundrisse, 103) "Such that it would seem one seeks `to discover the abstract expression for the simplest and most ancient relation in which human beings - in whatever form of society - play the role of producers . . . As a rule, the most general abstractions arise only in the midst of the richest possible concrete development, where one thing appears as common to many, to all . . .Indifference towards specific labours corresponds to a form of society in which individuals can with ease transfer from one labour to another, and where the specific kind is a matter of chance for them, hence of indifference .' (104) `The simplest abstraction, then, which modern economics places at the head of its discussions, and which expresses an immeasurably ancient relation valid in all forms of society, nevertheless achieves practical truth as an abstraction only as a category of the most modern society . . .This example of labour shows strikingly how even the most abstract categories, despite their validity precisely because of their abstractness - for all epochs, are nevertheless, in the specific character of this abstraction, themselves likewise a product of historic relations, and possess their full validity only for and within these relations .'(105) Thus labour is a simple general category which gains its `abstract' status as its concrete expressions proliferate . But how many concrete expression of labour are required for the achievement of this abstract quality? Why should only labour which has achieved an abstract quality in this sense, be value-creating and not labour per se? There seems to be no valid reason . The only way Marx could argue this was to introduce two more sets of dichotomous categories, namely, natural/social and subjective/ objective, such that labour that is `natural' and `subjective' does not create value while `social' and `objective' labour takes on an abstract quality which renders it value-creating . To Marx,

USE VALUES `natural' represents the man/nature relationship whereas `social' represents the man/man relationship . According to Marx's definition of objectivity, to be objective is to be social . Going back to the pivotal passage . : ` . . .commodities possess an objective character as values only in so far as they are all expressions of an identical social substance, human labour, that their objective character as values is therefore purely social . '(Capital Vol . I, 138) In other words, `objective' is that which is collectively generated versus `subjective' being that which is generated by the individual . To re-iterate my argument of the preceding pages, Marx's notion that labour was natural and subjective in pre-commodity production is fallacious . It is true that such labour did not attain an `abstract' quality as defined above in that its concrete expressions were relatively limited and its resultant products could not be reduced to a single measure ; namely, monetary price . Nevertheless, this does not in any sense provide grounds for deducing that the labour product was not socially determined, socially rationalized and socially realized in various social forms and through various social institutions outside of market mediation . Use value and the law of value re-interpreted There are six main points that serve to summarize the re-interpretation of the category use value and the law of value being argued here . First, use value and exchange value are both phenomenal forms of value ; `value' being defined as the socially rationalized product of labour and `labour' as the value creating substance . Thus `forms of value' refer to the forms or types of social realization that the products of labour undergo . Use value is the concrete qualitative form of value arising from `concrete' consensual labour that is realized through consumption whereas exchange value is the concrete quantitative form of value arising from `abstract' market mediated labour that is realized through market sale . Secondly, use values are always associated with human labour be it past, present or future labour . They are never solely natural substances . As congealed labour, they are socially valued . So too, since they result from labour and labour is socially determined, use values are a social form of labour . Thirdly, useful labour creating use values is carried out in social groupings and gives rise to a social division of labour . The social division of labour is an objective system of allocating

51

CAPITAL & CLASS 52

socially necessary labour time . Socially necessary labour time as has already been defined is the time required to produce an article under normal conditions of production and with the average degree of skill and intensity prevalent at that time . In non-commodity producing modes of production, there is no optimization of labour time according to profit maxims . However, labour time is rationalized according to the survival needs of the collectivity or prestation requirements . Especially in the latter case, social institutions arise to provide the structural framework for use value realization, analagous to the role that the market serves in providing the structural framework for exchange value realization . The mechanisms through which rationalization takes place will be outlined in Table 3 to follow . The general significance of the social division of labour is rarely emphasized in Marxist thought to date . The analysis of class and class struggle is considered the main object of Marxist theory . Class, however, is but one amongst several forms of the social division of labour . For a more comprehensive materialist perspective, the social division of labour in general and sex, age strata, class, regional differentiation and branches of industry in particular would all have to be seen as objects of Marxist theory and practice .' This is especially pertinent to the analyses of non-capitalist societies . Singling out class as the focus of the analysis as is done in so much of the Third World literature detracts from the significance of other forms of the social division of labour and often precludes the possibility of holistic analyses . Fourthly, use value as the value form of `concrete' labour and exchange value as the value form of `abstract' labour arise from objectivized social labour . In the process of use value and exchange value realization, the social units of production and consumption and their relations are reproduced . This is as true for capital as non-capitalist modes of production : ` . . .it is this continual reproduction of the same relations which the individual capital anticipates as self-evident, as an indubitable fact .' (Capital Vol . III, 872) Not to be overlooked, is the necessary attendant reproduction of the means of human subsistence vital for human survival under any mode including capital . ` . . .the capitalist process of production . .is as much a production process of material conditions of human life as a process taking place under specific historical and economic production relations . . .' (Capital Vol . III, 818) With this being the case, it must be said that just as non-commodity producing modes of production can be considered as `social' as the capitalist mode of production, in turn the capitalist mode can be considered as `natural' as the non-

USE VALUES commodity modes . What therefore distinguishes capital from other modes? What force in capital makes it possible for labour to achieve an abstract expression? There is no equivocation in the answer . , . .only capitalist commodity production is an epochmaking mode of exploitation, which in the course of its historical development revolutionizes the entire economic structure of society by its organization of the labour process and its gigantic extension of technique, and towers incomparably above all earlier epochs .' (Capital Vol . II, 120) Fifthly, the concept of `natural economy' clearly is a category that grossly over-generalizes if not trivializes the nature of non-capitalist modes of production relative to capital . The concept is positively detrimental to attempts to construct a materialist understanding of non-capitalist modes and therefore should be abandoned and replaced with more precise categories which centre around the social nature of use value production . Sixthly, the law of value must be understood in relation to the rationalization of labour time under pre-commodity producing societies as well as commodity producing societies . The closest Marx came to recognizing this was in the following passage when describing the social division of labour in a traditional Indian community . `The law that regulates the division of labour in the community acts with the irresistable authority of a law of nature while each individual craftsman, the smith, the carpenter and so on, conducts in his workshop all the operations of his handicraft in the traditional way, but independently, and without recognizing any authority .' (Capital Vol . 1, 479) Often the law of value is taken to refer to the exchange of equivalents . This is a very limited definition and has caused the unnecessary furor over whether Marx's theory of value is empirically correct or not . Another more advanced interpretation views the law as a process through which commodities are socially commensurated with regard to their common social dimension, labour . Having argued in this paper that noncommodity production is characterised by the same common social dimension and some form of labour time rationalization takes place as evidenced by particular configurations of the social division of labour, the law of value can be interpreted as being pertinent to non-commodity producing societies although oper.' Therefore assuming different ating under different regimes regimes of operation of the law of value, namely, the regimes of : use value, the accumulation of use value, exchange value and the

53

CAPITAL & CLASS 54

accumulation of exchange value, various aspects of the four regimes would have to be designated, such as the specification of economic agents, their logic, units of economic calculation, mechanisms and institutions for labour time rationalization and sites of value realization . In a highly schematic fashion the following table sets out the bare outlines of these aspects .

Table 3 : Aspects of the Different Regimes of Operation of the Law of Value

.egimes: °

Form of Labour

Use Value

Accumulation of Use Value

Exchange Value

Accumulation of Exchange Value

`Concrete' Consensual

`Concrete' Consensual

`Concrete' Consensual/ `Abstract' Market-mediated

`Concrete' Consensual/ `Abstract' Market-mediated

-Prestige

-Prestige, Rent Mercant Profit and Usury

-General Profit Rate

2 Mechanisms Human Motivating Survival Production and Providing Basis for Economic Calculationb 3 Ultimate Form of Product

Subsistence Good

Prestige Good

Commodity

Capital

4 Form of Surplus

None

Gift or Tribute

Exaction by Patron, Rent, Merchant Profit and Usurious Interest

Surplus Value Profit

5 Division of Labour

Sexual

-Age Strata or Class

-Regional and Town/Country

-Branches of Industry

Hunters and Gatherers None

Agriculturalists and Pastoralists Elders

Peasants

Wage Workers

Monopolists of Natural Resources, Markets or State Power

Capitalists

Economic Agents ` Producers : Appropriators:



USE VALUES

Units of Bands Production and Economic Calculation

Lineages with Forms of Economic Imposition by Appropriators

Peasant Household with Forms of Economic Imposition by Appropriators

Industrial Factory

National Market and state

1) Social Institutions Involved in Value Realization (Circulation)

Band Cooperation

Moral and Political edifices of Age Elites and Classes

Political Institutions of power Cliques and Local Market

Form of Value Realization

Use Value Expressed in Terms of Survival Need

Use Value Expressed in Terms of Prestige Need

Exchange Value Expressed in Terms of Merchant Selling Price

Individual and Band Consumption

System of Reciprocity, Prestationand/ or Coercion

Local Market

National Market

1 1) Institutions Band's Ritual Involved and Commonin Social sense Notions Rationalization Socially Defining of Labour Subsistence Time ` Needs

*System of Reciprocity, Prestation and/ or Coercion with Unequal Consumption Levels Socially Defined

*Market with Growing Regional Social Differentiation

Banking System with Unequal Productivity Levels Attaining in Industries

2) Mechanisms for the Social Rationalization of Labour Time

*Unequal Consumption of Surplus Product

*Exactions, General Profit Unequal Exchange Rate Expressed as by Merchants, Weighted Average Rent Usury and of the Prices of Taxation creating Production Town/Country prevailing in Differentiation Branches of Industry

Existence of Elite or Class

Wider Territorial Market

1)

1 0) Site of Value Realizations

Mortality Rate of Band Members

3) Ultimate Band's Site of Existence Social Rationalization of Labour Time and Periodic or Sporadic Disequilibrium

Exchange Value Expressed in Terms of Market Selling Price

Credit Market of Banking System

55

CAPITAL & CLASS 56 14) Nature of Value Reproduction

Discontinuous

Discontinuous

Discontinuous

Continuous

* Note where the appropriators do not control the production process, the producers directly rationalize their production under the weight of imposed inequality of consumption and value realization. The regimes of operation of the law of value can be identified with specific modes of (a) production . The communal mode is an example of the use value regime and the lineage mode, an example of the accumulation of use value regime . There are several modes that exemplify the exchange value regime - where commodity production is gaining dominance at the expense of the original use value-producing base ; these are slavery, feudalism and other clientage modes including the present day Third World clientage mode exhibiting an embryonic market and an unstable state apparatus . Finally the only mode which exhibits the accumulation of exchange value regime is the capitalist mode and its variant state capitalism which is evident in many industrial countries espousing a socialist ideology . (b) The mechanisms providing the basis for economic calculation (2) must not be taken to be exclusive within their respective regimes . Reading the columns from left to right, any mechanism listed in a column to the left of the column being considered is pertinent as well, such that under the regime of the accumulation of exchange value, the general profit rate, prestige, merchant profit, usury and human survival are all possible mediating mechanisms although the general profit rate is determining . The same holds true for the division of labour (5) . It should be noted with regard to the economic agents (6) and their respective units of (c) production and economic calculation (7) that in the regimes of accumulation of use value and exchange value the producers often produce in units that are not under the immediate supervision of the appropriators . Appropriation takes place through morally or politically coercive social institutions. Under the regime of use value, economic calculation and value realization remain internal to the band whereas under the accumulation of exchange value, economic calculation resides in the unit of production, however, social institutions (8) outside the unit of production, namely the market and state provide the conditions for value realization . All of these structural features have far-reaching political implications for struggles between historically specific producers and appropriators. (d) The site of value realization (10) and the ultimate site of social rationalization of labour time and periodic or sporadic disequilibrium (13) should be compared within the respective regimes . Basically there is an identity between the two sites under the regimes of use value and accumulation of use value, whereas under the exchange value and accumulation of exchange value regimes the two sites are distinct . Under the exchange value regime the impact of the wider territorial market on the rationalization of labour time may be marginal if infra-territorial circulation is not well developed . It is significant to note however that the wider territorial market, the site of social rationaliation under the exchange value regime, is transformed into the national market, and becomes the site of value realization under the regime of the accumulation of exchange value. (e) Regarding the social institutions (11) and the mechanisms (12) involved in the rationalization of labour time, it appears that the mechanisms under the regimes of use value and the accumulation of exchange value effect a process of social averaging whereas the mechanisms under the regimes of the accumulation of use value, and exchange value operate on the basis of inequality . This is an illusion created by what has already been mentioned as a distinct feature of these two regimes ; the estrangement of the appropriators from direct control of the production process and hence the morally or politically coercive measures their appropriation is founded on . Labour time rationalisation on the part of the producers is carried out in the face of the exigencies of expropriation .

USE VALUES

Change from one regime to another The tabloid presentation of the different regimes of the law of value may unfortunately give the impression of unchanging, self-contained, repetitive systems of production . What is the dynamic for change from one regime to another? Marx described the dynamics of change in the transition from feudalism to capitalism (Capital Vol . I, 871-940), which represents the decline of the regime of exchange value and the ascendance of the accumulation of exchange value . The motor force in this case was the unprecedented development in the productive forces and relations of production . In the transition from the regime of use value to the regime of accumulation of use value and in turn the transition to the regime of exchange value, less has been written . It appears however, that the dynamic for change from one regime to the other is embedded in the interrelationship between the mode of production and the mode of human reproduction ; the modes of production being constituted by the relations of production and productive foces giving rise to specific levels of labour productivity whereas the modes of human reproduction are constituted by the relations of human reproduction and reproductive forces giving rise to specific levels of population growth . 3 In a long term general sense, correspondence between labour productivity and the population size determines the degree to which the socially acceptable level of means of subsistence is realized . There are a number of different socially conditioned aspects of the developmental process which engender change and are all inter-related, they include : first, population fluctuations : secondly, changes in the content and form of the natural resource base due to changes in internal properties resulting from human utilization ; thirdly, the process of socially redefining the natural resource base as a result of improvements in the productive forces making resources formerly unutilizable into material upon which human labour can be applied ;' and fourthly, the process of redefining the socially acceptable level of means of subsistence . All these aspects of the overall developmental process are intimately related to the relations and forces of production and human reproduction . Marx described the impact of many of these aspects in the following passage which refers to the Roman Empire . `The aim of all these communities is survival ; i .e . reproduction of the individuals who compose it as proprietors, i .e. in the same objective mode of existence as forms the relation among the members and at the same time therefore the commune itself. This reproduction, however, is at the same time necessar-

57

CAPITAL & CLASS 58

ily new production and destruction of the old form . For ex-

ample, where each of the individuals is supposed to possess a given number of acres of land, the advance of population is already under way . If this is to be corrected, then colonization, and that in turn requires wars of conquest . With that, slaves etc . Also, e .g ., enlargement of the ager publicus, and therewith the patricians who represent the community etc . Thus the preservation of the old community includes the destruction of the conditions on which it rests, turns into its opposite . If it were thought that productivity on the same land could be increased by developing the forces of production etc . (this precisely the slowest of all in traditional agriculture), then the new order would include combinations of labour, a large part of the day spent in agriculture etc ., and thereby again suspend the old economic conditions of the community . Not only do the objective conditions change in the act of reproduction, e .g . the village becomes a town, the wilderness a cleared field etc ., but the producers change, too, in that they bring out new qualities in themselves, develop themselves in production, transform themselves, develop new powers and ideas, new modes of intercourse, new needs and new language ." (Grundrisse, 493-94)

Practical Implications of Non-Capitalist Regimes of the Law of Value

What is the usefulness of reformulating the meaning of the term , use value' and sharpening the distinction between the terms `value' and `exchange value'? Is this an exercise in mere semantics or does it have implications for practice? Theoretically, the reformulation of these concepts expands the application of the law of value to all social production, and in so doing the law of value becomes a more holistic labour theory of value . As a labour theory of value subject to historical specification rather than solely a 'market-mediated labour' theory, the law of value ceases to be glaringly capital-centric and dismissive of non-capitalist production . Politically, the recognition of valorization under noncapitalist modes has far-reaching implications . Analysing noncapitalist production within the conceptual framework of the law of value focuses attention on the pattern of labour time, the logic of the producers and appropriators vis-a-vis the unit of production, the productive output, the mechanisms of appropriation, etc . Such analysis can provide a specification of the nature of appropriation by social groupings other than a capitalist class, i .e. those appropriating on the basis of their age, sex, regional



USE VALUES 59

mobility, or monopolisation of the means of production other than capital . From this, political practice and policies aimed at undermining non-capitalist appropriation can be formulated . Philosophically as well as politically, moving away from an essentialist notion of the law of value which vests the market with power akin to transubstantiation, i .e . the market as the sole agency that can effect concrete labour's transformation into 'abstract' value-laden labour, rids the law of value of tautology and idealism . 5 An essentialist notion of the law of value is ultimately fatalistic in outlook, tending to ignore the role of individual agents' consciousness and inferring the futility of politial struggle in all forms other than complete abolition of the market . Table 4 is an attempt at indicating the immense scope for consciousness raising and politial action at various junctures in the circuit of value formation, value realization and value rationalization .

Table 4: The value circuit and individual calculation

VALUE FORMULATION . The expenditure of Labour Power in the production process Producers work motivation Appropriator's rationale for production and appropriation

VALUE RATIONALIZATION

Appropriator's complacency or goal to innovate

Social institutions of an ideological, financial . military, economic nature, etc . moulding the mode of production and appropriation

Producer's aquiescence orrevolt

VALUE REALIZATION Use value consumption Exchange value Market sale

CAPITAL & CLASS 60

Table 4 schematizes the structural interlinkage between subjective calculation and objective value formation, realization and rationalization that is common to all modes of production in which surplus appropriation takes palce, bearing in mind that each mode of production evolves historically specfic institutions, conventions and norms in its value circuit . These institutions, conventions, norms, etc . assume an objectivized social nature vis-a-vis the day-to-day calculations and purposive action of individual producers and appropriators, but it must be stressed that whatever their specific historical form and objectivized nature, the calculations and purposive action of individual agents have unceasing impact on them . Indeed the specific historical forms of value formation, realization and rationalization are the cumulative net result of purposive action on the part of past and present appropriators and producers . In non-capitalist and capitalist modes alike the subjectivity of the agents gives rise to and interacts with the objectivity of the value. circuit . The perceptions of the agents may be distorted, but their actions are rooted in a specific historically determined logic that must be defined and understood in order to be consciously transformed . This is the starting point for any effective political action .

Third World Development Turning to the political conjuncture in today's Third World where non-capitalist production and appropriation are salient, it is evident that the Third World's transition from peasant-based national economies affording only low standards of living to industrial countries capable of achieving high levels of productivity and providing much enhanced levels of consumption to their populations is becoming more and more imperative with each pasing decade . International aid agencies and Third World nation-states who have legitimized themselves as bearers of 'development' have vested interests in effecting the transition . In development circles there are basically two main cotlnterposing theories on how to bring about change . The orthodox development economics position views `economic take-off as a matter of the right combination of `factors of production' ; land, labour, capital and credit applied in the context of a `free' national and international market . The most notable advocates of this position are the World Bank and the International Monetary Fund joined by many conservative Third World governments . The opposing school of thought taking a more radical position derived from underdevelopment theory view the competition of Third World economies in the world market with consternation .

USE VALUES In its most polemical form the school has been known to argue for Third World disengagement from the world capitalist system as the only meaningful solution . This extreme stance however is generally restricted to university lecture halls, whereas Third World government planners and international consultants sympathetic to the theory of underdevelopment are usually found recommending various forms of state intervention as a means of mitigating direct exposure of Third World production to the rigours of world market competition . Protectionism plays an important part in their strategy, as do government subsidies and direct government participation in production . While the two theories formulate quite different policy prescriptions, they have far more in common with each other than is generally thought . First, both the `orthodox' and the `radical' positions emphasize the vital need for foreign aid to develop the Third World . In other words, both recommend capital and technology transfers from the First World to the Third World . Secondly, both theories tend to ignore the operation of different economic logic from that prevailing in industrialized capitalist social formations . The one believes capital investment channeled through the market will lead to increasing productivity, whereas the other believes capital investment safeguarded through state agencies will lead to increasing productivity . This may be the case under the capitalist mode where a general profit rate exists, but is this always the case in a Third World context? In many, if not most Third World countries, the majority of the economic agents are not workers and capitalists whose production is regulated through the regime of accumulation of exchange value, but rather peasant producers on the one hand, and monopolists of natural resources, markets or state power on the other, whose economic activity is moulded under the exchange value and accumulation of use value regimes of the law of value . Third World economic agents tend to become involved in networks of clientage . Clientage networks tend to proliferate in the face of the vagaries of a production process which generates limited surpluses and is subject to discontinuity due to the poor control it exerts over such natural elements as soil fertility, weather, e tc . as well as the lack of transport and communications and the effect of rudimentary technology . In this context prestige aggrandisement through obligatory payments to patrons, state exactions, the unequal exchange of merchant profit and usury all act as dissolving forces on the peasant productive base . Economic plans and programmes which do not acknowledge these forces run a high risk of being thwarted . Non-capitalist logic, mechanisms and forms of value real-

61

CAPITAL & CLASS 62

ization must be analysed in order to be understood on their own terms . At the moment, the `radical' position passes them off as evidence of peripheral capitalism, whereas `orthodox' economists ignore them or see them as troublesome abberrations from otherwise virgin territory ripe for capital investment . Until noncapitalist regimes of the law of value are understood and the knowledge used to effect the channeling of non-capitalist surpluses into productive accumulation for industrialization, economic policies be they geared to the full play of the market or state intervention can easily become instruments for noncapitalist extraction of crippling proportions and result in increasing immiseration of the Third World . I am grateful to Howard Stein, Gavin Williams and referees and members of the editorial board of Capital and Class for their comments on earlier drafts of this paper . Notes

This point is also of direct relevance to the question of how 1. feminism and Marxism relate to one another . It is absurd to generally declare the primacy of class over gender or vice versa, since both are interdependent . 2. Weeks (1981 :11-62) in his discussion of value theory emphatically asserts that the law of value is applicable only under capital, by drawing on the theme of the `appearance' of equivalent exchange versus the `essence', i .e; capitalist class appropriation through the market . Since Marx so pointedly rejected Ricardo's vulgar labour theory of value .which revolved on the notion of equivalent exchange and since the nonequivalence of exchange is just as evident in relation to non-capitalist class appropriation, it is difficult to see why Weeks points to this theme as a basis for arguing the non-applicability of the law of value to noncapitalist production . Ultimately Weeks resorts to the standard tautology that the law of value applies only in an economy evincing monetized private property, namely the capitalist mode and inversely, monetized private property under capital gives rise to the law of value (Weeks 1981 :53) . 3. See Bryceson, D . F . and U . Vuorela, 1980, `Outside the Domestic Labour Debate: Towards a Materialist Theory of Modes of Human Reproduction' for a more detailed discussion of modes of human reproduction . 4. Le . a redefinition of the range of potential use value production within a given resource base is involved. 5. In an excellent review of literature on the law of value, Bradby (1982) satirizes recent authors' mystification of the role of labour in the law of value .

Bibliography

Banaji, J . (1979), `From the Commodity to Capital : Hegel's Dialectic in Marx's Capital', in Elson (ed) 1979, pp . 14-45 . Bradby, B . (1982), `The Remystification of Value' Capital and Class, No . 17, Summer 1982, pp . 114-135 .

USE VALUES Bryceson, D .F . and U . Vuorela (1980), `Outside the Domestic Labour Debate : towards a Materialist Theory of Modes of Human Reproduction', University of Dar es Salaam Seminar Paper . Elson, D . (1979), `The Value Theory of Labour', in Elson (ed) 1979, pp . 115-180 . Elson, D . (ed) (1979), Value : The Representation of Labour in Capitalism, London: CSE Books . Ganssmann, H . (1981), `Transformations of Physical Conditions of Production : Steedman's Economic Metaphysics ;, Economy and Society, Vol . 10, No. 4, November pp . 403-422 . Kay, G. (1979), `Why Labour is the Starting Point of Capital', in Elson (ed) 1979, pp . 46-66 . Marx, K . (1976), Capital Vol . I, Middlesex : Penguin Books . Marx, K . (1978), Capital Vol . II, Middlesex: Penguin Books. Marx, K . (1977), Capital Vol . III, London : Lawrence and Wishart . Marx, K . (1973), Grundrisse: Introduction to the Critique of Political Economy, Middlesex : Penguin Books. Napoleoni, C . (1978), 'Sraffa's "Tabula Rasa"', New Left Review No . 112, November-December, pp . 75-77 . Sraffa, P . (1960), Production of Commodities by Means of Commodities, Cambridge : Cambridge University Press . Steedman, I . (1977), Marx after Sraffa, London : New Left Books . Sweezy, P . (1979), 'Marxian Value Theory and Crisis', Monthly Review, July-August, pp 1-17 . Thompson, E . P . (1978), The Poverty of Theory, London : Merlin Press . de Vroey, Michel (1982), `On the Obsolescence of the Marxian Theory of Value : A Critical Review', Capital and Class, No . 17, Summer pp . 34-59 . Weeks, J . (1981), Capital and Exploitation, Edward Arnold, London .

University of Pennsylvania Press

TOWARDS A NEW US INDUSTRIAL POLICY

Michael L Wacher & Susan M Wacher, editors 'Brilliantly done - essential background reading for better understanding the economic and social scene today.'-George Ball, Wall St Journal . Justpublisbed,536pp, £11.00

University of Pennsylvania Press 1 Gower Street, London WC1

63

CAPITAL & CLASS



Ray Bush, Lionel Cliffe and PeterSketchley

Steel :The South African connection offer a whole range of links between the apartheid economy of South Africa and the western world, links closely involving the transnational corporations . This is true of the steel industry notwithstanding the fact that in both South Africa and the UK a major part of steel production is in the hands of nationalised concerns - the Iron and Steel Corporation in South Africa (ISCOR) and the British Steel Corporation (BSC) . Transnational corporations (TNCS) have played an important role in the rapid growth of the South African steel industry . Even BSC itself has operated as a 'transnational' ; for many years it was in partnership with ISCOR and still has interests in South Africa . Steel manufacturers in Britain have supplied the know-how which has built up the South African steel industry, and in turn the whole armaments industry there . The collaboration between steel producing companies in the two countries is but one of the links explored here . Indeed much of the significance of that collaboration lies in the past . The growth of South Africa's steel output has been so rapid that the chief relationship today between the two groups of steel producers is as competitors . South Africa has become a major exporter of steel . It is competitive in the global market place, in large part because of its very low labour costs . Below we document the low wage levels and the treatment of workers and their organisations . As a result South African steel has been imported into Britain and MOST MAJOR INDUSTRIES

C . & C . 20-E

Prepared for a November 1982 UN/ Sheffield City Council conference on Transnationals and South Africa, this paper shows how British dependence on apartheid's 65 `strategic raw materials' is avoidable and trade sanctions would sustain rather than destroy UK steel jobs .

CAPITAL & CLASS 66

Europe and indeed some anti-dumping measures have had to be taken against South African imports by the Board of Trade . It is also a competitor for British and European steel in other overseas markets . Far from the catastrophic impact on production and employment in the British economy, that apartheid propaganda stresses, the first impact of restrictions on British trade with South Africa and of more general international economic sanctions through the UN would be a significant positive impact on markets for steel and an increase in jobs in that industry . But the propagandists urging continued links with South Africa have another argument that particularly centres on the steel industry . They threaten enormous job losses in Britain not because South Africa is a market for steel, which it is not, or for steel technology, which it still is to a degree, but because of another linkage : that between the steel industries of Britain (and Europe), especially in special steel and fero-alloys, and the mineral producing industries of South Africa . The propaganda argument is that South Africa supplies minerals that are `strategic', in that the special steels industry cannot do without them, but also because industry as a whole cannot do without special steels and alloys . It is also argued that there is no alternative source of supply to South Africa . Thus the UK South African Trade Association, who estimated that up to 180,000 jobs would be lost because of the closure of whole industries, if Britain is ' . . . denied the supply of vital raw materials imported from South Africa, most of which could not readily be replaced even at increased cost from other sources . These include platinum, chrome, vanadium and manganese without which a number of British industries manufacturing exports for our major markets in the USA and the EEC would cease to operate .' It will be noticed that three of the `big four' items that figure top of such lists of `South Africa's strategic raw materials' are in fact used mainly in the steel industry, specifically in the production of fero-alloys - chrome, vanadium and manganese . So the main part of this paper will be devoted to scrutinising the allegations that steel, and in turn much other industry is irretrievably dependent on South African supplies of these raw materials . In tracing how these links between steel production, in Britain and Europe, and mineral production in South Africa have come about we shall in fact focus very much on the large, private TNCS that dominate this minerals traffic . Specifically our concern is to try and answer questions that employers, workers and planners obviously need to have answered when any consideration of sanctions against South Africa is raised : What is the extent of the steel industry's dependence on 1.



STEEL South African supplies of minerals? Are there any alternative sources of supply or other 2. minerals that could be used? What kind of planning and restructuring would have to be 3. undertaken to reorientate steel production away from South African sources of supply? and what would be some of the costs and the effects on jobs? As a case study, we shall try to indicate where possible what these issues would mean for a city like Sheffield, host to this conference and the centre of special steels production in Britain, but also a city dedicated to ending its economic ties with South Africa . Finally, we shall raise another issue that is not often mentioned by those who would maintain trade . What would be some of the costs and effects on jobs if 4. action is not taken to end the extreme dependence of an industry like steel, or a city like Sheffield, on South African sources of supply? We aim to show that there is at present great reliance on South Africa as a source of the steel industry's raw materials ; but that this dependence is in no way `necessary', in the sense of being dictated by South Africa's monopoly of the products, their natural occurrence, or the nature of the production processes in steel . We shall further argue, with respect to the fourth question, that it will be extremely shortsighted and foolhardy to continue to rely on supplies that are at risk ; and that a shift away from purchases from South Africa and a modification of industrial processes can be affected without major disruption, if planned now .

Producing for a long time for a rapidly expanding home market, in recent years the South African steel industry has become a large exporter - ranking in the first two exporting countries outside the OECD - the developed countries . British investment and know-how have been crucial in this expansion . When iSCOR produced its first steel in 1934 the integrated plant owed much to skilled personnel from Britain and Germany . Equipment supplied from the UK has been instrumental in South Africa increasing its production from 160,000 a year in the 1930s to over 9 million tonnes in 1980. South Africa has forced its way into exports markets to the extent of over 2 million tonnes in 1980 - which makes it an exporter on a scale close to that of Britain . Unlike the UK, however, South Africa's exports are not offset by correspondingly large imports of other steel products . It is a large net exporter. ISCOR is responsible for three quarters of South African steel output, a handful of large private companies for the rest .

67

The South African steel industry and its external connections

CAPITAL & CLASS 68

ISCOR is also a large producer of iron ore - the eleventh largest in the world . It exports about half of the ore ; in 1980 some 45% of this went to Japan and the Far East, just over half to Europe . British and European corporations continue to supply the technology to make possible a continued expansion - even in times of crisis . For example, the Distinction Engineering Co ., part of BSC's Sheffield Division, recently supplied several continuous casting machines to ISCOR . Recently, using a Japanese Sumicoke process Didier, a subsidiary of Voest Alpine, the Austrian iron and steel corporation has been building coke briquettin and ore dealkanising plants for ISCOR at the Vanderbijlpark and Newcastle works (Financial Mail, Johannesburg, 8th April, 1981) . The result of this European involvement in SA steel plants will be to enhance ISCOR's steel producing efficiency by reducing the amount of blast time required to make a given quantity of iron . The assistance given by European and Japanese enterprises will also increase the export potential of ISCOR and thereby help British and European competitors make headway into Briain and other markets . One well-known, private Sheffield firm Davy Loewy has been involved in building a steel plant in South Africa over many years and regularly sends out workers on contract from this city to South Africa . Another way in which South Africa has been dependent on expertise from Britain is through the recruitment of artisans and technicians from the traditional steel-making centres in Britain . ISCOR has in fact run a full-time recruiting office in London for some years . In one period of a few months in 1973-74 that office arranged for over 1,000 families to move to South Africa . The contracts offered are ones that seek to encourage such skilled workers to become permanent immigrants . This kind of recruitment has of course been facilitated by ISCOR's many contacts throughout the British steel industry, and, today, in the teeth of mass redundancies in the steel industry many British workers are given the advice to go to South Africa . In 1980, for instance, a panel of industrialists from the mining, engineering and metal industries visited this city as the guests of the Sheffield Chamber of Commerce and in their discussions with their hosts the issue of how to recruit skilled personnel no longer needed in the city was one of the main items on the agenda . The significance of this recruitment of essentially skilled workers is that it has not only made possible a rapid expansion of steel production but done so while simultaneously maintaining patterns of `job reservation' on the basis of race . The continued recruitment of (white) artisans and technicians from abroad postpones the time when black South Africans are given the training

STEEL to fit them for these jobs . The effect of racial employment policy is indicated by the fact that in ISCOR's operations, which demand large numbers of skilled workers, whites outnumber Africans . The expansion of steel output, even over the last ten years of world recession, has been made possible by low costs . In part this is due to the fact of cheap labour, as we shall detail in a later section . But ISCOR and the private firms also benefit from cheap raw materials ; of locally mined iron ore, produced by migrant workers whose wages are among the cheapest . ISCOR has also been assisted by the continued illegal occupation by South Africa of Namibia . About half of ISCOR's tin requirements are met from a mine 330 kilometres from Windhoek, the Namibian capital (Financial Mail 7th November, 1980 p .54) . In addition to the tin which is used in the production of electrolytic tinplate at the Vanderbijlpark works ISCOR also procures the bulk of its zinc for galvanising steel sheet from a mine at Rosh Pinah, this time in southern Namibia . The 1974 UN Decree Number 1 for the protection of the natural resources of Namibia in fact specifically makes such mining ventures illegal and prohibits the extraction and exploration of any of Namibia's natural resources.

The TNCs stake in South African steel The British steel industry has done more than just supply technology and manpower . It has had a direct investment stake in the South African steel industry . BSC has in fact had a number of joint venture deals in steel, iron ore and other raw material production with ISCOR over the years . It also inherited a further stake when private steel firms in the UK were nationalised . In the late 1970s BSC's SA subsidiaries in fact employed some 20,000 workers - at the time equal to almost a quarter the number they employed in Britain itself. Stewarts & Lloyds (SA) was one such subsidiary chiefly engaged in production of pipes and in steel stock holding and selling in South Africa . This company and other assets worth £41m were in fact sold off in 1981 - though more as a consequence of `privatisation' policies being urged on BSC than with the aim of disinvestment in South Africa . BSC still has two wholly-owned outlets in South Africa, one simply a sales outlet as well as significant holdings in Dorbyl Ltd ., Consolidated Metallurgical Industries, International Pipe & Steel Investments & Pipe Couplings (Proprietary) Ltd . But outside ownership in South African steel is not confined to BSc . There are a handful of large steel plants in the private sector in South Africa, contributing a quarter of total output - all in the hands of large corporations . Some of these corporations are the big mining houses for which steelmaking

69

CAPITAL & CLASS 70

and other manufacturing are offshoots of their big stake in South African raw material production . Thus the Anglo American Corporation (- headquarters in South Africa but itself very much a TNC with vast assets in Canada, central and southern Africa and elsewhere) owns the Highveld Steel and Vanadium Co, Dunswart Steel is owned by General Mining . The other TNCs with a direct stake in South African steel are British (and a few European) companies with interests in steel here . Steelmaking and related TNCS with a presence in Sheffield that have a direct stake in South Africa include : GKN (the giant steel/engineering firm which owns Shardlows, Laycocks, e tc . in Sheffield) in 1979/80 owned 11 subsidiary companies in South Africa . In 1981 GKN was named by the Department of Trade as one of the four British companies employing most black workers at wages below what the EEC's Code of Practice considers the bare minimum - some 1,166 workers . While cutting back in Sheffield- Shardlows laid off 500 workers in 2 years in Sheffield - it opened an additional heat treatment plant in South Africa in 1980 . Associated Engineering who took over the Tempered Springs and other Sheffield firms in the 1970s has 17 South African subsidiaries - one of which, Glacier Bearings, was involved in a dispute in 1979 when it refused to recognise the Metal & Allied Workers Union . Johnson Firth Brown owns six South African companies . Davy Corporation, originally a Sheffield engineering/plant construction firm now in the TNC league, has supplied plant to South Africa and has 6 companies in South Africa . Rio Tinto Zinc (which now owns Thos . W . Ward in Sheffield) runs the huge Rossing Uranium mine in Namibia . This mine contributed £20 .2 million towards a net profit of £102 .3 million for a TNC with large interests in Southern Africa . Rio Tinto Zinc has 2 South African subsidiaries, Rio Tinto South Africa Ltd and Palaboya Mining Company Ltd. Thos . W . Ward itself also has 2 . Sanderson Kayser (laid off 200 workers in Sheffield) and Hemmings Ltd . Both these firms are owned by GEL GEC has two subsidaries in South Africa, 'Technitool' makes precision engineered products and 'Sanderson Newbould' processes and distributes special steels . James Neill has 2 ; James Neill Tools (Proprietary Ltd .) and Neill Tools (Proprietary Ltd .) Record Ridgeway has 1 ; Samuel Osborn a Sheffield family firm taken over in the late 1970s by Aurora Holdings owned 6 companies in southern Africa and in the late 1970s obtained almost 90% of its group profits from that part of the world - more than any other British

STEEL company at the time. LonRho is a special case . This vast conglomerate has its origins very much in southern Africa, owns no less than 100 companies in South Africa, in various activities ranging from mining to retailing. 69% of its 1980 profits came from Africa . In the late 1970s it bought extensive interests in the Sheffield-based private steel sector, acquiring controlling interests in Edgar Allen Balfour, Dunford Elliott (which at the time owned 4 South African affiliates itself), Hadfields, Brown Bayley and Ashe & Nephew . Brown Bayley has now closed . LonRho seem to have pursued an assetstripping operation vis-a-vis these steel firms and thousands of jobs in Sheffield have been shed - 1,800 in 1981 in Hadfields alone - as plant has been closed down . South African steel as a competitor As plant has been shut down in Sheffield the opposite is the case, even in the midst of depression, in South Africa . We have already referred to South Africa's growing exports . But, unlike Britain, South Africa imports very little steel and is making plans to become more self-reliant . It has perfected the production of a whole range of finished and semi-rolled, drawn and forged products and is now developing its special steels . Thus Southern Cross Steels of South Africa has announced that it has developed a corrosion resisting steel expected by the 1990s to generate a turnover of R 1 billion . This new development is designed to fill the gap between stainless and carbon steels. Heavily dependent upon ferrochrome this new steel, produced by a subsidiary of Middlesburg Steel and Alloys will add yet another nail in the coffin of British steel manufacturers who at present meet the demands of the South African and other potential markets for this type of steel . The outcome of this activity is inevitable . As one leading ISCOR official commented recently : `Many of the traditional European and American steel makers will have to go to the wall and this will improve our opportunities' (Financial Mail, 8th May 1981) . Steel closures and redundancies are already upon us in Britain and the situation will get worse unless Britain withdraws financial and personnel assistance to South Africa . The British steel industry cannot afford to invest its resources in the development of its competitors . This year South Africa's exports to Britain are running at a level of 130,000 tonnes . This represents only a small proportionperhaps 2-3% - of total UK imports of steel, though still second largest to Japan of countries outside Europe . Still, it is worth

71

CAPITAL & CLASS 72

pointing out that even at today's reduced manning levels, producing that steel here would have employed perhaps 1,000 workers . Thus we can say that : the direct gain in jobs by an embargo on South Africa would be of the order of 1,000 . Add to that an unquantifiable number of jobs would also be gained in the British Steel industry as a result of Britain supplying other export markets that South Africa would lose in the event of general international sanctions . However, the potential threat to British and European steel is very much greater than this modest figure of present South African exports indicate . Thus the August 1982 Metals Bulletin listed the following new plant on stream in South Africa : • Direct-reduction works for ISCOR at Vanderbijlpark - capacity 600,00 tonnes per year . • New electric steelmaking capacity at ISCOR's Pretoria works 900,000 tpy . • Highveld Steel-6 electric smelting furnaces to extend capacity to 1,100,000 tpy . • Dunswerk Iron & Steel Works expanding section mill to 350,000 and later to 500,000 tpy . • Sears - new bar and section mill - 400,000 tpy . All the indications are that South Africa with its profitable cheap labour will build up the capacity being destroyed in steelmaking areas in Europe like Sheffield .

Cheap labour in the steel and mining industries of South Africa One fundamental reason for the competitiveness of South African steel in world markets is the abundance of cheap labour . This is of course a basic feature of the whole system there . The various mechanisms of apartheid have had that effect . Job reservation, a fact of life throughout this century ; influx control which forces `unproductive dependents' to remain outside the white areas, and thus avoid being a charge on the firms that employ the menfolk ; the homelands policy which deprives workers of citizenship and other rights where they work ; the continuation of patterns of migrant labour reduces wages in those industries that rely on migrants, like iron ore and other mining and indirectly reduces the bargaining position of all workers . Add to these general factors the limitations on workers' right to organise which affect all industry, and it is small wonder that many transnational corporations find South Africa their most profitable area of investment . But let us look at how some of these factors which determine cheap labour operate with respect to the industries that are our

STEEL concern here . There are about 190,000 workers in the steel industry ; some 68,000 were employed by ISCOR in 1978 while some 20,000 plus are employed by the other, private firms in the industry . Wages are fixed for the whole of the steel and engineering industries, altogether involving 440,000 workers in 1981, through the relevant Industrial Council . There each year, the tough Steel and Engineering Industries Federation of South Africa (SEIFSA) - representing very much as one voice some 8,500 employers (the engineering industry is marked by a large number of small manufacturers) meets unions to negotiate pay and conditions . Although each side has an equal number of Council representatives, the unions do not speak with one voice . Only the unions that are `registered' under South African law - and it is only in the last two years that unions with African members have been eligible - sit on the Council . Moreover, wage bargaining is separated from the work place and so workers' say in the proceedings is diminished, the process even more bureaucratised, and for these and other reasons to do with the nature of the system as a whole, progressive trade unions do not take part . The unions that do are not only more ready to accept the apartheid structure but they are themselves divided : different industries within the larger metal working industries, but also widely differing in their whole approach . The net result is that there are 14 registered unions at present on the Council but they represent only a third of the workers in the whole of Steel and Engineering . The major union, in steel and engineering, which is also one of the largest and most effective unions with black members in the whole country, the Metal & Allied Workers Union (MAWu) rejects the Council system as it now operates, although it takes part in wage negotiation at a factory level and is not opposed to such bargaining on a national level, but only if negotiations for separate industries within S&E are broken down, and if they are restricted to representative unions rather than paper unions that the government is prepared to recognise . The Industrial Councils really only fix a minimum wage for the S&E as a whole, irrespective of whether particular firms could afford more . But even from their weak position the unions - even the registered ones - are showing signs that they will not be a pushover and also that they will not tolerate this antiquated system indefinitely . The wage negotiations of 1982 actually reached deadlock . There has in fact been a whole series of strikes and stoppages in the metal-working industry . But even more crucial for this paper are conditions in mining - which not only supplies iron ore used in South Africa but the so-called strategic minerals that will be discussed in Part II . The mining industry has always relied heavily on migrant labour .

73

CAPITAL & CLASS

74

For that reason, wages in that industry are especially low . At present African miners' average monthly wage is about £110 about a fifth that of white workers . In 1974, after some marked wage rises, total profits of the mines were eight times the total African wage bill! And if we forget averages, LonRho was reported in 1980 by the British Department of Trade as paying 724 wages of between £39 and £42 per month . Conditions of work below ground are dangerous and a risk to health, and living conditions, with single men's hostels in the `mine compounds', are inhuman when they are not insanitary . Moreover, African mineworkers have increasingly organised protests, including strikes, which are often portrayed by management and police as `tribal fights' . Regime and company persecution has led to deaths . The South African Government's own Committee of Inquiry into the last major series of incidents in 1975 admitted that : `it is the system of migratory labour, per se, that is creating the problem' . In similar vein, Harry Oppenheimer, head of the biggest mining house has been on record for many years as being against the migrant labour system but it is still in operation in the extensive operations of his corporation, Anglo-American - and the other producers of minerals like Rio Tinto Zinc and Union Carbide .

Radical Science Journal Special SCIENTISM IN THE LEFT Issue No .13 (1983), 128pp, £2/$5 LES LEVIDOW : We Won't Be Fooled Again? STEVE SMITH : Taylorism Rules OK? DOUG KELLNER : Science and Method in Marx's Capital JOE CROCKER : Sociobiology : The Capitalist Synthesis TIM PUTNAM : Proletarian Science? (review of Stuart Macintyre) TONY SOLOMONIDES : Counters (on Demystifying Social Statistics) Also letters and short reviews . Back issues still available : RSJ 12 (1982), E2, Medicalisation ; RSJ 11 (1981), E2, 'Science, Technology, Medicine and the Socialist Movement' ; RSJ 10 (1980), £2, Third World ; RSJ 9 (1979), f1 .50, Medicine ; RSJ 8 (1979), fl ; RSJ 6/7 (1978), £1 .75 ; RSJ 5 (1977), £1 . Bookshop Distribution by Full Time (UK) and Carrier Pigeon (USA) . Bulk orders from RSJ at 'h discount . Subscription for 3 issues : £6 individuals, E13 .50 institutions . Single copies : 20p extra . Non-£sterling cheques : 60p extra .

RSJ, 26 Freegrove Road, London N7 9RQ

STEEL 75

African mine labour has also been precluded from joining trade unions, and even the ground swell of black trade unions in South African manufacturing industry in the last few years has not so far affected mining . It is this absence of any alternative channel for the demands that led to another dramatic wave of unrest in South African mines in June and July 1982 which involved an estimated 30,000 workers . This upsurge is just the latest in trends which point to a growing confrontation of employers by black workers . 1981 was the worst year for strikes in the Republic since the Mine Workers Strike of 1946, and this year may be another record . The 1975 Mine Riot Inquiry frankly acknowledged that the industry was `very vulnerable' in the face of mass action by workers . Today the signs of a major showdown for all industry in South Africa are much more in evidence . LonRho's chairman in South Africa summed it up in a 1980 Study by Business International : `From an economic point of view, South Africa is a very good place for investment, even fantastically good . . . Politically, however, South Africa is in a very sad situation . . . I wish I knew what was going to happen .'

`Britain's enemies know South Africa's Minerals are as vital to the west as Middle East oil' Financial Times 1981 . Advertisements such as this have appeared in major newspapers in Europe and the USA . They represent just one aspect of the apartheid regimes multi-million dollar propaganda machine . It is not necessary here to repeat the details of how a totalitarian propaganda machine works or the depths to which it will go to whitewash its image . We will, however, show that the dependency argument is nothing more than a crude and clumsy scare campaign with no objective basis . The basic truth is that far from having to be dependent on South Africa, in the present recession-hit world minerals market, there are many alternative suppliers who who be only too glad to sell us their own production gluts and stockpiles . But also we shall show that thanks to the manipulation of minerals trading by Transnational Corporations, this country, unlike most of our competitors, has been put into a state of unnecessary dependency on a handful of producers in one of the most politically unstable regions of the world . Our crisis-ridden steel industry, fundamental as it is to the security of production and employment in the shipbuilding, aircraft, construction and motor industries as it is to our national

The British Steel industry and South African minerals

CAPITAL & CLASS 76

defence, hangs by a thread - totally and unnecessarily dependent on five ferro-chrome converters which in 1979 produced only 28% of world trade in ferro-chrome, yet in 1980 supplied over 35% of UK imports! And worse - this ferro-chrome production had previously been produced in Britain before ferro-chrome production had been axed so callously and ill-advisedly . It is difficult to overstate the unthinkable consequences that would follow say a major attack by guerillas on these five plants (and remember in 1980 they blew up the Sasol coal-to-oil refinery) . Or if electricity supplies were cut (as they have been frequently in all parts of South Africa in the last few years) . There have been frequent strike waves in all of the industrial areas over the last year . Protracted dock or rail strikes could paralyse supplies at any time . And that is not to mention the real risk of sanctions or tariffs being imposed by the UN, EEC, or a future British government! Anyone discounting that possibility should remember what happened last time and the consequences of a boycott of sanctions busters by black African countries like Nigeria - already a bigger market for Britain than South Africa . In any of these situations, our competitors will turn to their more diverse network of suppliers (usually holding 12 month contracts), in many cases these countries hold strategic stockpiles of these minerals, which unlike us they could turn to . Those countries with ferro alloy conversion plants left intact would have the supreme advantage as the remainder scramble for the short term stocks and for contracts with the alternative suppliers . Managanese, chrome and vanadium - vital elements in Sheffield's steel making Let us examine exactly what these minerals are, and how they are used . Steel is basically a mixture of iron carefully refined to contain specified percentages of carbon . To this basic mix are added small amounts of manganese, chrome, tungsten, molybidenum, titanium, niobium, cobalt, nickle, vanadium . The addition of even small quantities of these minerals can completely transform the properties of the steel, making it more (or less) tensile, ductile, resistant to corrosion by acids or alkalies, and resistant to high or low temperatures . South Africa exports a number of the minerals listed above, but the quantities are not claimed to be significant in all but manganese, chrome and vanadium for which it claims the status of `strategic supplier' . Below we examine these in turn .

STEEL 77

Manganese Unlike the more exotic minerals, manganese is used mainly in the production of bulk as opposed to special steels . About nine tenths of all manganese is used in the metallurgical industries . It is essential for overcoming the disadvantages of the presence of sulphur, for the avoidance of short hotness and also for encouraging deoxidation in steel making . Manganese is used in two forms - either as an ore, or combined with iron as a ferro alloy called ferro-manganese . We shall deal with this distinction later when we discuss the other ferro alloy - ferro chrome . Table 1 : World trade in manganese ore and ferro manganese in 1978 (000 tons metal content) Manganese ore Australia South Africa Gabon India Brazil Mexico Ghana Zaire USSR

China Thailand Hungary Japan France West Germany Norway USA

93 600(13 .6%)

1,100

-

648 608 135 128 144(l) 2,992(l) 504 17(2) 64(2) 36

525 9,200 (1) 1976, (2) 1975, (3) 1977

Others Total (approx)

Ferro manganese

634 1,662( 18%)

207(3) 118 100(3) 950

(e)

na -

na 460 435 198 225 264 750 4,400(1)

Sources: IISI, USBM etc . quoted in Metal Bulletin, August 1982 .

This table shows that South Africa has an 18%and 13 .6% share of manganese and ferro-manganese production respectively and both are available from a wide range of alternative sources . Despite this, the EEC is buying 25% of its supplies from South Africa, and the UK is nearly twice as dependent with 46% . It should be noted that some 10% of South Africa's exports are taken illegally from its occupied territory of Namibia. Chrome

South Africa's strongest case for the west's dependence on its minerals is undoubtedly with respect to chrome where it has a

CAPITAL & CLASS 78

world share of production of between 26 and 30% . This figure has been grossly exaggerated in the past by illegal exports of sanctions busting chrome from Rhodesia . Even today we have found it difficult to find Zimbabwe's production reflected in official export statistics, as much of Zimbabwe's production still passes through South Africa, and mysteriously seems to end up included in its export figures . Also to South Africa's supreme embarrassment, up to 90% of its chrome reserves lie in the so-called `homelands' of Lebowa and Bophuphtatswana . Not surprisingly, the Van der Bilt Consolidation Commission implementing the `homelands' policy recommends that all exploitation and marketing of the reserves should remain in the hands of the South African state . About 60-70% of chrome ore is used in the metallurgical industries . Chromium is used for producing iron castings, stainless and high speed steels and some super alloys . Ferro chrome (see below) accounts for 46% of total use . Chromium is vital for use in high pressure, high temperature and corrosive environments such as the petro chemical industry, nuclear reactors, and electrical generating turbines . Table 2 : International trade in chrome in 1979 (000 tons metal content) Chrome ore Ferro-chrome South Africa 1,022 728 Zimbabwe 189 75 Philipines 140 Turkey 170 50 Albania 290 na USSR 840 235 Finland 115 50 Brazil 93 90 India 89 26 Sweden 195 USA

268

China 90 Japan 399 France 93 Yugoslavia Min 76 West Germany 48 Others 142 82(l) Total (approx) 3,090 2,605(l) Min - under 500 tons . na - not available . (1) excluding Czechoslovakia Source : IISI Metal Bulletin monthly, August 1982 . Table 2 shows that South Africa has a 33% share of chrome ore and 28% share of ferro-chrome production . Yet despite this in 1980 the UK imported 92,573 tons of chrome ore, of which South Africa supplied 67,895 tons, Philipines 9,200 and

STEEL 79

Mozambique 9,716 tons . This means that with a world share of only 33% of total trade, through its multi-national mineral traders, South Africa supplied 73% of the UK imports . On the other hand one of our major competitors, the USA took substantial quantities of ore from Finland, Philipines, Turkey, Albania and took also 30% of all USSR exports to eastern and western countries . In 1977 (the latest figures we could find) the EEC took 49% of their total chrome ore imports from South Africa .

Only five years ago there was a thriving ferro-chrome conversion industry in Europe with production centred in Sweden, France and the UK, with a number of other EEC countries having substantial production . Now Sweden has drastically cut its production and in France and the UK the whole industry has closed down . Production in Italy and Greece is struggling to survive but seems doomed to follow the same path due to lack of orders. Meanwhile, South Africa's production has rocketed from 246,000 tons of ferro-chrome in 1974 to over 700,000 tons in 1979! This is at a time when production of ferro-chrome has expanded to the present 46% of total chrome production and we have seen the collapse of the European industry . The growth in ferro chrome production came about partly by the introduction of new stainless steel production with the Argon-Oxygen-Decarburising (AOD) process . From virtually zero production in 1970, 10 years later 75% of stainless steel production was by the AOD process . This allowed buyers to switch preference from the high quality (low carbon) Rhodesian product (which was subject to sanctions after UDI) to low quality (high carbon) South African ore . This resulted in low carbon ferro chrome falling within a period of 6-7 years from 40% to 10% today . Although these ores and ferro alloys are substitutable for most applications, their great attraction is that ferro alloys are up to twice as profitable to the producer. Ferro chrome production in South Africa is concentrated in the 5 major conversion plants in eastern Transvaal in close proximity to the major chrome mines and the W itbank coalfields . The cost advantage to South Africa is cheap ore and subsidised electricity coming from cheap coal (thanks to non organised migrant labour and the Bantustans) . Three companies control 70% of South Africa's output . The eighteen chrome mines mostly underground - are owned by around ten companies including : South African Manganese (SAMANCOR), General Mining, Barlow Rand and Associated Manganese . It is these groups who also own the ferro chrome (and ferro manganese) convertors . Associated Mining and General Mining are owned by multinationals with large scale interests in American steel

Ferro alloys a case study of manipulation by the transnationals

CAPITAL & CLASS 80

producers . SAMANCOR is owned by South African Manganese which is in turn 10% owned by the US company Onival . Feralloys is 45% owned by us Steel and 55% by Associated Manganese of South Africa . Highveld steel in which Anglo American Corporation has a large stake is 10% owned by New Mart Mining . The major producer Tubatse Ferro Chrome is 49% controlled by Union Carbide which also manages the facility, and 51% by General Mining . It is here that Union Carbide chose to develop the AOD process . It was a conscious choice by a major multinational to set up production in South Africa and exploit the cheap labour the apartheid system creates and in the process decimate the European ferro chrome industry while putting us in the unnecessary dependency upon this explosive region of the world . Not surprisingly a handful of multinationals control ferro alloys trading in Europe, and the two big ones Metallgeshaft and Klockner are closely inter related as well as having a major involvement in South Africa . And so again the EEC imports 44% of its ferro chrome from South Africa . Meanwhile the us and Japan become respectively 71% and 79% dependent on South African ferro chrome (and remember that is disproportionate to South Africa's 28% of world production) . In 1979 Britain imported 39% of its ferro manganese and 35% of its ferro-chrome from South Africa . Ominously, South Africa is tending to divert more of its production into its own steel industry, as we have seen . We have also shown above however that South African steel production is increasingly encroaching upon British and European overseas markets . A result has been that : `Some marginal producers of ferro chrome in Japan and Europe have already disappeared from the scene in the face of competition from South African producers' (Mr Greg Cooper, a senior manager of General Mining Financial Mail Joburg 28th September 1979) . How long will it be before the Mail will be reporting that bulk and special steel producers have disappeared from the scene in Sheffield in the face of competition from South African producers? Is there an alternative? As table 2 indicated there are several countries which can supply chromium but since we are concerned with Southern Africa it is worth pointing out that the most newly independent country, Zimbabwe, can readily supply not only chrome ore but ferro chrome to the specifications needed in the steel industry in places like Sheffield . In particular Zimbabwe could increase high carbon ferro-chrome (the low grade South African equivalent) if there is sufficient demand . Zimbabwe has in fact set up a unified minerals and mining board thus giving potential customers the convenience of one agency for all of its dealings .



STEEL 81

Vanadium

Traditionally vanadium has been used for ferro-vanadium and other iron-vanadium alloys to strengthen tool tips for high speed cutting applications and in dies for hot forging . It has also been widely employed to prevent grain growth during forging and to help retain strength creep resistance at high temperatures in certain steam power plant components such as rotors, stream pipes, super heated tubes and turbine castings . In the past 20 years it has seen a growing application in gas and oil pipelines and heavy-duty railway tracks . It seems that for most uses substitutes can be found including molybdenum, tungsten and columbium, whilst for the catalysts platinum can be used . Vanadium pentoxide is widely traded and is produced from many raw materials and slag . Table 3 : World trading in vanadium 1980 (000 tons metal content) South Africa 12 .7 China 4.5 Australia 0.6 Finland 2.8 USA 4.4 USSR

Chile Norway Others Total (1)1979

10.0 0.5(l) 0.5

35 .9

Source: USBM, Metal Bulletin

With 35% of the world production and only 9% of world reserves South Africa again cannot be said to dominate exclusively the world market . Once more though Britain has a disproportionate dependency upon supplies from South Africa obtaining 50% of its vanadium from this source . As Metals Bulletin review of 1981 put it : `An Australian producer dominated the vanadium market (in 1981) . Agnew Clough established a new mining operation last year, shipping the first pentoxide to Japan in July . Unfortunately vanadium was on the downward slope . While Agnew Clough boosted supply there was no equivalent increase in demand . As a result prices slipped . . . These prices proved too low for Agnew Clough which in January (1982) announced a temporary closure of its Wundowire operations .' BSC utilises 85% of imported manganese, 55% of vanadium and

50% of chrome . It produces around 80% of crude steel output and a high percentage of the more common finished products in C . & C . 20-F

Recession in the world minerals market

CAPITAL & CLASS 82

the UK . Its share of the more specialised steel production is sometimes less than 50% . Between 1976 and 1980 UK steel production halved (down from 22 to 11 million tons) . As we all know steel production over the last two years has fallen away dramatically throughout the Western World ; as a result ferro manganese production in South Africa fell from 461,000 tons in 1979 to 304,700 tons in 1980, a fall of 34% and it is still falling . As Metal Bulletin's annual review of 1981 stated : `Manganese and chrome ore markets last year were extremely dull . Producers made persistent efforts to get consumers to accept higher prices, but consumers, especially Japan, were well stocked and saw no need to co-operate . The South Africans wanted to increase prices 20-30% . . . But Japanese consumers asked for a cut of 5% . Eventually the two sides decided to stick at the existing price .' `Ferro chrome was another slow mover with consumers resisting price increases . In particular they resisted Montedison's attempt to reopen its ferro-chrome plant in Italy . Montedison tried to secure enough orders to open its plant . . . it was not certain that they would succeed .' Similarly the Greek ferrochrome producer `Hellenic' is struggling to re-establish production with even less success due to lack of orders . Such then is the over supply state of the world markets . A classic buyer's market . More than ever there is no real dependency case to answer . Accordingly there is no reason why a ton of South African ore should be imported whilst so many alternatives exist . At present, however, over 50% of minerals mined in South Africa are exported with a total export value of $7,000,000,000 per year and representing about 55% of total exports . The industry employs slighty over 1,000,000 workers of whom no more than 4% are white . Fixed investments in mining have been growing at an annual rate of 6% . However, without foreign capital and the related import of mining technology the growth of this industry would long ago have ground to a halt . Large segments of the mining industry are managed by `finance or mining houses' whose prime backers come from Britain, the us and other Western countries . Today approximately 25% of shares are held by Britain and American shareholders and that is not counting the German and Dutch . Of the $20 billion invested in the mining industry $5 billion comes from abroad . The EEC countries have over $2 billion of aggregated investment (direct and indirect) in the industry . But although representatives at Tory conference speak unreservedly in support of `kith and kin', the trade papers which represent the wider interests of industry (sometimes in competition with the narrow interests of dominant TNCs) often reflect

STEEL a more considered voice . They too are quite capable of seeing the growing unrest provoked by resistance to the apartheid regime and thus what was seen as a secure source of raw materials is now seen to be `not the most stable of areas' (C C Leach BSC stainless Metals & Materials August 1980) . Indeed, such dependency upon a limited number of sources of supply, located in regions of political instability is a matter of serious concern' (Metals and Materials, September 1980) . And again : `South Africa is considered by many to be a major political risk due to its apartheid policies, and the possibilities of serious racial and political tensions . In the past this has led to some caution on the part of investors, and has been a major factor stimulating the establishment of strategic metals stock piles in some consuming countries . . . In addition emphasising this dependence has stimulated consuming companies to carry out research into alternative metals and - a diversification of the sources of supply' (Metal Bulletin August 1982) . As we have shown, however, this is not the case for British Industry which has submitted to unnecessary dependency by restricting trading to South Africa and allowing the rundown of ferro alloy production . Indeed the false dependency which Britain has upon South Africa's supply of minerals is recognised by the South Africans themselves . In an extended discussion of the `strategic' nature of South Africa's mineral supplies the South African Financial Mail (2 3rd February, 1979) itself admitted that `There are very few commodities for which there is no scope for interchangeability' . Moreover it was noted that `The issue of stockpiles has come alive in Europe as a direct response to instability in Southern Africa . The contemplation of such protective measures is an acknowledgement that a disruption of South African supplies would have the power to wound but it would not necessarily kill European industry' (p .562) . The lesson is clear . Now is the time to look for secure alternative sources of supply before the struggle against Apartheid in South Africa reduces British industry to a standstill .

There is a sense in which we are grateful to the South African state propaganda machine for drawing the world's attention to the west's `dependency' on its mineral supplies and for the opportunity to show that this dependency is a result of manipulation of trading by the TNCs rather than the chance distribution of the world's mineral resources . It also gives the opportunity to highlight a real dependency . South Africa exports 80% of its minerals - virtually all to Europe, Japan and the USA . In many cases it exports 100% of its production . Take iron ore -

83

Apartheid's dependence on the West

CAPITAL & CLASS 84

South Africa exports 80% to Europe, but that represents a mere 2% of European consumption . So who is dependent upon whom? Sanctions effectively applied to ailing South Africa could snuff out its economy at a stroke . Even a partially effective campaign (and realistically it would be difficult to police every ship rounding the Cape) would destroy the confidence of international capital in the form of the TNCs who are propping the system up . It would encourage those seeking an end to the Apartheid regime, it would deepen splits between the hardline fight to the last racists and the Oppenheimers who would take a negotiated settlement now . But there is another form of `dependency' . Compared with the mineral deposits in what we call the 'frontline states' of Botswana, Tanzania, Mozambique Angola, Zambia and Zimbabwe, which are rich in copper, oil, diamonds, uranium, chrome, and countless other minerals, our dependency on South Africa is a joke . The front line states have now joined with Malawi, Lesotho and Swaziland to form SADCC (Southern African Development Co-ordination Conference) and are needing aid and support from the west to unify their infrastructure and lessen dependence on South Africa . South Africa has responded with the invasion of Southern Angola with thousands of troops permanently stationed in occupied territories and with their open backing to terrorists they have infiltrated to disrupt particularly the newly independent states of Mozambique and Zimbabwe . It is essential that aid and co-operation agreements are developed with these countries in our own long term mutual trading interests and that every assistance be given to defend these countries from attack and destabilisation by an ever more desperate regime . Let us not forget also our `dependence' on Black Africa which accounts for three times our trade with South Africa . In 1980 for example the UK visible exports to South Africa were worth £1,002m (fob) whereas the value of exports for the rest of Africa was £3,275 million of which £ 1,204 million went to Nigeria (Financial Mail Survey 13th November, 1981) . We risk losing this trade the whole time that Britain is seen to prop up Apartheid South Africa. Remember for example that in 1979 Nigeria nationalised BP obtensively because a tanker which had been chartered by BP and which called at a Nigerian port was owned by South Africa . It was one small flexing of what are very powerful muscles . Conclusions on short term dependency When we started to research this paper we got involved in a lot of work to check South African claims about potential job losses, that production in the west would `grind to a halt within six months', we got into questions of strategic stockpiles and

STEEL technical substitutions for the minerals . You are spared some of that work, because as we cut through the propaganda statistics and as it dawned on us the significance of the recession to the world minerals market, we came to see that in the present depressed state of world steel production there is no dependency argument to answer.

W e have highlighted very real and immediate dangers that come from an unnecessary dependence created by the manipulations of the multi-nationals in their own minority interests diametrically opposed to the security of production and employment in Sheffield . It is precisely these interests who are responsible for the destruction of our ferro alloy industry, and even as you read this, capital that working people in this country have created is being used to build up a steel industry on the other side of the world as we face the prospect of further massive closures . In answering the dependency argument, we have chosen to fight on their ground of the national interest . Let us be quite clear . This is not a protectionist argument. We are not saying `our jobs not theirs' nor are we advocating a narrow nationalism . The case we have made is clear . There is no valid reason at all for our country to be in the trading pocket of the Apartheid regime . There is no justification at all why the multinationals should be allowed to shift capital which we have created, to exploit brother and sister workers shackled by state terrorism, and denied the basic human rights to sell their labour freely by collective bargaining, and to elect a government of their own choice . South Africa's mineral exports represent over two thirds of the total value of exports . The fall in minerals production due to the world glut of over production combined with a fall in gold production which by the end of the decade is expected to fall to only half current level has resulted in a huge balance of payments deficit of £1,524 millions . This could exceed £2,200 millions by the end of the year. In October of this year South Africa applied for an emergency loan of £690 million from the IMF . Long term access to reserves

Figures like `98 .6% of most reserves of chrome are to be found in South Africa and Zimbabwe' or `84 .9% of manganese, is in South Africa and Australia' highlights the fact that South Africa does have very large and important reserves of minerals which will be important for the next 500 years . Certainly they are not as great or important as South Africa claims - for example consider two sets of statistics :

85

CAPITAL & CLASS 86

Mineral Reserves in South Africa SA Dept of Mines US Bureau of Mines Manganese 12140 717 Chrome 3097 2270 Vanadium 7760 1815 But we shall concede the argument that South Africa does have significant deposits which if turned into a cartel excluding Britain would create serious problems . (We are talking here in the long, long term of the next century and after .) However, `The USSR is of particular relevance to the concept of strategic metals as it produces many similar metals to South Africa and is therefore a potential competitor . However one commentator has considered the possibility of a commercial link up between South Africa and the USSR, and the dangers of such a cartel . Such an eventuality is not considered likely at the present but could occur if there were certain political changes in South Africa he adds .' Metal Bulletin August 1982 .

In looking at the future there are certain things one can say with absolute confidence . The first is that Namibia will sooner rather than later be independent . It is the last occupied colony in Africa and this anachronism is as sure to be eliminated as it was for India, Rhodesia and every other colony to become independent . Secondly the Apartheid regime is a lost cause . Its only hope for the future is to increase repression to try to stem the tide of demands for democratic control by the South African people . Whilst Ian Smith was saying `There will be no black majority rule this year, next year or in my lifetime, never!' and within 18 months finding himself a member of parliament headed by that `terrorist' Prime Minister Mugabe, Lord Carrington had seen that the war against the people of Zimbabwe could not be won and was trying to negotiate the best deal he could in Lancaster House . It was Sweden who materially supported the liberation war of FRELIMO in Mozambique and is the biggest single aid donor in that country now . As a consequence one sees Volvo and Scania trucks lined up on the docks at Maputo together with EFAS from the German Democratic Republic . Now the lines are drawn over Namibia with Britain in the same trench as Reagan and Botha fighting for `democracy, peace and freedom' . But as Carrington saw and history has proved time and again, the way to secure access to markets and mineral supplies is not to drive those who will win a just war into the hands of anyone who will support them and align oneself to a morally bankrupt fascist state whose moment in history has already run out . Looked at this way South Africa's reserves dependency argument explodes in its face and in the face of anyone sitting in the same trench .

STEEL We have made a clear case that sanctions and embargoes can and must be applied; and rather than costing jobs in Sheffield, will safeguard them in the long term . Realistically, this kind of action should be pressed for at government level . Equally realistically, the present government is unlikely to upset its financial backers and `natural allies' by spontaneously implementing sanctions . Page 113 South African Financial Mail (13th November, 1981) reminds us `Since the Thatcher government has been in power the spotlight on South Africa's apartheid policies has been somewhat dimmed' . But, however reluctant, there is a possibility that in the future this country may be faced by UN-imposed mandatory sanctions - so how much better to anticipate that prospect now and not run the risk of being caught on the hop? We do have the advantage that our interests correspond with the economic interests of steel producers . It is important therefore to press home this advantage and to make the government show its open and unpopular support for South African interests . We have identified BSC as by far the biggest single user of South African raw materials and competitor with South African steel imports which are going to grow alarmingly in the future . This has to be put to them forcefully through union planning meetings and consultations . Sheffield Council has taken a principled stand and it is important that they too are enouraged to press the case, expose the dangers and moral arguments against any trading with South Africa . But as the Council attempts to involve itself in economic planning for the region and also acquires a stake in the steel industry, one would hope that it would plan for alternative supplies and possibly make this a condition for its pump-priming of local firms . The Common Market is heavily involved through the joint steel industry tariffs and quotas (particularly in the face of American protectionism) . They too should be pressed through Euro MPs to call for UN sanctions and for their own quotas to exclude South African supplies . We should argue and plead but what experience is showing over job protection in steel is that the only thing that makes the deaf listen and the most myopic see is direct action . A campaign by trade unions, possibly to black imports of South African coal and steel and all imports of minerals could be explained to rank and file members as long run guarantees of their jobs and would be a powerful focus for the issues concerned . For, in conclusion we would stress that for a whole range of reasons which we have stated disruptions to supplies are possible even likely, and that thought and planning now will minimise the consequences in the short term . We are grateful for the help of a number of people in preparing this paper including Peter Cromer, Peta Jones and Makoto Sato .

What is to be done in Sheffield?

87

CAPITAL & CLASS 88

International Journal of Urban and Regional Research Editorial Board : Michael Harloe, Manuel Castells, S.M. Miller, Enzo Mingione, R.E. Pahl, C.G. Pickvance, Frances Fox Piven, Edmond Preteceille The International Journal of Urban and Regional Research is concerned with the study of conflicting interests in urban and regional development, demonstrating the social basis of different approaches to planning and state intervention . Selected topics in volume 7 • The theory of labour and the theory of location • Cooperative housing and decentralized health care in Quebec • Regional development and urban policy in the Federal Republic of Germany • The emergence of an urban social movement in Israeli society • A history of planning in the Paris region • Information, restructuring and the survival strategies of the working class • On the squatter movement in the Netherlands • Housing classes and housing policy : some changes in the Budapest housing market • Urban and regional processes under capitalism and socialism : a case study from Czechoslovakia Published quarterly : March, June, September, December 640 pages approximately per volume Subscription rates : £33 Institutional £20 Individual Members of ISA, BSA, ECPR and KNAG are entitled to subscribe to the 1983 volume at the special rate of £17 .

Edward Arnold 41 Bedford Square, London WC1B 3DQ

STEEL

Robin Murray

Pension Funds and local authority investments' This article engages with popular left critiques of financial institutions such as those which view them as a major cause of Britain's economic decline . Instead these critiques should be seen as criticisms of money as capital pursuing maximum self expansion . The article considers that local authority pension funds potentially fall into this category and should be employed as part of a strategy of restructuring for labour . The conclusion is that it is restructuring rather than finance which is the crucial issue .

89

CAPITAL & CLASS 90

THIS PAPER DEALS with what existing local authorities can do (particularly those authorities currently under socialist control) to use pension funds for the purpose of long-term investment . National law must therefore be taken as given, though as with so many fields of local authority initiative at the moment, precisely how we should interpret the law is a major variable . But part of the importance of these local initiatives is that they are testing the social control of finance in practice, and they are testing it as one part of a much wider investment strategy .

The significance of finance To begin with we should be clear about the significance of finance in a progressive economic strategy . It is one moment in the overall circuit of capital, a circuit that also embraces (i) the purchase of inputs for the production process ; (ii) the production process itself ; (iii) the sale of the output . In as much as a progressive strategy envisages that some form of capital circuit will continue, and not be substituted by, say, a planned use value form of economy which does not use money as capital, then the question of the signficance of intervention at the money capital point of the circuit becomes important . There are three lines of argument we can distinguish in the current debate . First, there are those who argue that the financial institutions in Britain are a major cause of British economic decline, and their regulation and/or control would be crucial for any arrest in that decline . The financial institutions are attacked for : (a) failing to provide long-term investment funds in the UK ; (b) investing abroad ; (c) investing in unproductive assets, or

in speculative landed property . The Wilson Committee' considered these points, particularly that relating to longterm finance, and different sub-groups offered various answers : a medium term re-discounting facility to counter the drying up of long-term industrial bonds ; a more active involvement of the longterm financial institutions in industry ; and the TUC proposal of a National Investment Bank, to be jointly funded by the state and the long-term investing institutions . Many have followed this general approach both before and after Wilson, emphasising the lack of venture capital for new business, and the more general absence of funds for fixed assets and the long-term . The major response to this - and not merely from the financial institutions defending themselves - has been that it is not the institutions which are to blame but the lack of projects in which they can securely invest . There has been a steady decline in the profitability of productive industry both in the UK and elsewhere, and it is to the root causes of this that we should address ourselves . There is in fact a surplus of investment funds, but a dearth of profitable outlets . As Marx and Keynes would say, at a moment of crisis money capital is withdrawn from the circuit of productive capital . The crisis is reflected in the monetary sphere, but the monetary sphere does not cause the crisis . In broad terms I would support this latter line of argument . Capitalist money cannot alter its intrinsic character, which, like capital in general is to drive always for maximum self-expansion . It invests abroad because there is greater profitability overseas . The fault lies with the removal of exchange controls not the managers of the funds . It invests in property, but the fault lies in an organisation of landed property which permits secular

PENSION FUNDS real increases in urban rent, and therefore offers a secure hedge against inflation . It eschews new, small, untried ventures because of the risk relative to investment in large concentrations of capital . In this by and large money capital is right, for it is not just a question of attitudes towards risk, it is that in general large corporations are economically stronger than small firms, and the real risk is correspondingly less . It may be that some parts of the British financial establishment are risk averters ; that some of them take unnecessarily short views, and are in brief bad managers from the point of view of capital profitability . But the financial institutions attract more criticism because they are managing capital well (from capital's point of view) than because they are managing it badly . Our experience in the last year at the GLC (Greater London Council) suggests we can go further . We have found a number of financial institutions taking a longer-term view than the government would have wished . Major clearing banks (Barclays and the Midland) have been rapidly expanding their industrial firstaid departments . The aim is to avoid a devaluation of their capital by restructuring firms which on the criterion of profitability should be dispatched to the receiver . Major receivers, too, have been involved in many of the restructuring operations - both before they are called in (when they act as advisers to the bank in their capaicty as accountants) and as active receivers trying to restructure their assets as a going concern . The Bank of England, likewise, has been active in forestalling bankruptcy by co-ordinating intervention . All these financial institutions have a self-interest in avoiding capital devaluation, and preserving a productive industry capable of re-

producing profits in the long run . From 91 what we have observed in a number of cases, the financial system can be seen as operating an alternative industrial policy to the government, more active in its intervention, and less short-term in its financial criteria . I say `short-term' to relate this recent experience to the debate . But in many ways the emphasis on the period of capital funding mis-specifies the issue . The question is whether particular projects are ever likely to be profitable, or put in another and more positive way, whether the criterion of profitability is any longer appropriate for the allocation of resources . Take first the case of a firm on the verge of bankruptcy . The GLC has been approached by some 30 such firms in the last nine months . The issue in each case is not the absence of long-term funds, but whether (a) there is any hope of the enterprise ever earning a normal rate of profit ; and (b) there is a long-term nonmarket case for supporting the enterprise . As far as (a) is concerned, there are instances of firms which have expanded too fast, and been caught short by the collapse of demand after 1979 . Here there is a case for long-term capital investment . But often these are found in sectors already heavy with overcapacity, when even newly equipped firms may have no long-term security . More common were firms which clearly needed restructuring if they were ever to achieve market profitability : old plants, with old machinery, in some cases producing commodities which were becoming rapidly obsolete technically (such as push button B telephone boxes) or facing a long-term declining market (for instance in the up market furniture trade) . The question in these cases is how the restructuring is to take place (if at all), who is to carry it through, how long will it

CAPITAL & CLASS 92 take, with whom would it make sense to merge . These are the issues - restructuring the use value side of production - rather than the availability or not of long-term finance . In the Wilson Committee discussion, there were two groups of dissenters to the majority opinion that no new longterm investment agency was required . One group was composed of TUC representatives and Harold Wilson himself, who argued for a new investment agency, capable of investing £2 billion a year in productive industry, and funded from the institutions and North Sea tax revenues . The other group contained significantly Sir Kenneth Cork, who, as the country's most eminent receiver, could be described as capital's official restructurer . This group argued that a new institution was needed which `would depend partly on its own resources and partly on the number and size of investment programmes it could discover or create . Its own resources consist almost entirely of skilled staff and finance . Of these two, we believe the more important constraint is the staff' .' In as much as the issue for the British economy is one of restructuring, the Cork group argued that what was needed was a public body of restructurers who should build up their financial resources in line with their staff capacity . They point out that fund managers do not have skills which are `appropriate to appraising new projects' . They criticise the TUC line on the grounds that it concentrates on exchange value (finance) and not on use value ('men and machines') . It is the right projects which need to be developed, and only then does finance need to be made available . What is interesting in this proposal is that it emphasises that a `shortage of demand for finance is a major part of the problem' rather than the shortage of

supply of long-term funding, but at the same time argues for state intervention in the development of new projects. `In our view present arrangements need to be buttressed by a new facility (probably organised in a decentralised way) through which new projects and new firms are actively sought and promoted' .' It shifts the criticism of financial institutions from their short time horizons to their incapacity to actively develop new projects . The financial institutions might say that restructuring is not their job (though they are increasingly being drawn into it - witness for example Lazards' plan for restructuring the foundry industry by widespread closures with cross compensation) . They might argue that it is industrial not banking capital which should restructure production . What the Cork group were suggesting was that, blame aside, if neither were doing it, then the state should intervene . My argument here is that the main issue is active restructuring rather than long-term finance . The discussion has focussed on the inadequacy of institutions to provide appropriate finance, whereas it should first consider the inadequacy of institutions to restructure whole sectors of the national economy . Long-term finance without detailed plans for restructuring will be of limited value as far as projects which will be profitable in the long-term are concerned . The second issue which tends to get underplayed is whether there are projects which may never make a profit, but which are still important in the long-term . The question here is not short-term as against long-term availability, but whether on market criteria there will be any funds at all . In public investment circles there is a tendency to refer to such projects as `social' . In the guidelines to the National

PENSION FUNDS Enterprise Board or the Scottish Development Agency, they are given only passing reference . These public agencies in order to show themselves rigorous in approach adopt relatively stringent criteria, based on expected market profitability, which they apply to new projects . The Cork group argue that their proposed state investment bank should appraise projects which are financed at below market rates against strict criteria, linked principally in to manning and productivity levels agreed with the unions .' The new facility should not be used for `propping up firms for social or political reasons' .' In all these instances the projects are envisaged as being `viable' in the longterm . Those that are not are regarded as in some way soft . But this is to accept that market valuations are accurate reflections of social valuation, which is clearly not the case . Some projects may be important for stimulating others, or because they use otherwise wasted resources, or because they might have to be protected against international competition in the long-term because they produce socially useful products with methods of work which do not degrade labour in the same way as international competitors . If we link this back to the earlier discussion, restructuring may take place in a number of ways with very different implications for labour . Some ways involving adequate wages and working conditions will be at a disadvantage in the market vis-a-vis enterprises that have been restructured by and for capital . It is therefore important to have a funding institution which can support and protect projects which have been restructured for labour . A third type of project we should consider is that where the market is no longer an adequate mechanism for

determining the type and pace of tech- 93 nical change . In a number of industries technical change is taking place so fast that any new plant built will be rapidly obsolete . This often discourages investment in research and development . Given the uncertainties, firms wait for others to make the initial moves . Only the largest can carry the costs in these circumstances, and these, too, are having to scrap virtually new plant (ICI for example), or to judge constantly the trade off between investing and waiting, or developing a type of technology with a long commercial life, rather than a type with longer-term technical possibilities . The technology of cables is one example, or of electronic switching systems, or types of videodisc . In the case of technological development, as in the previous point about desirable projects which are unlikely ever to reach market profitability, it is not the financial system but the market system as a whole which is inadequate . Improving the flow of long-term funds aiming for market profitability does not address these problems, and it is these that are further aspects of the process of industrial restructuring . I have not wished to suggest that adequate long-term finance is not important for any programme of active restructuring . But it should be seen as part of a package, and not as the principle variable . Furthermore, in as much as it is used as part of a package, its character as capital must be recognised . Its aim is always the maximum expansion of its value, and this remains true whether the banks are run by old Etonians or by socialists in government . A second line of argument about financial institutions is that they are not like any other private enterprise (as the Wilson Committee implied) but that they

CAPITAL & CLASS 94 form an economic `estate' . Most recently, this argument has been developed by members of the Open University Financial Studies Group (Coakley and Harris') . Finance capital - as we may call this estate - has acted economically and politically as a macro force whose results have been to keep up interest rates and the exchange rate in order to maintain the strength of sterling . This has put British industry in a weak position economically, which it has not been able to remedy politically . For these reasons, the destruction of this political power is needed, via the nationalisation of the financial institutions, following which interest and exchange rates will be adjusted downwards . This tension between industrial and finance capital is an important one, but the social control of finance capital and a lowering of the cost of capital and the value of the pound is again too restricted a financial view of the necessary conditions for industrial revival . If the issue is as I have posed it namely one of restructuring, the question is to what extent low interest and exchange rates will encourage restructuring . It can be argued that such falls by providing a degree of protection, would discourage restructuring (certainly Mrs Thatcher thought that the opposite moves of raising interest and exchange rates would lead to restructuring according to her preferred path) . It is as part of a more active policy of restructuring for labour that these adjustments in circulation are important . A third line of argument is that the financial institutions are now the commanding heights of the economy, and that their nationalisation will give a socialist government control over finance and industry . A recent and closely reasoned case of this sort has been made by Richard Minns' of the West Midlands

County Council, but it has a longer tradition in socialist thinking, having much in common with Hilferding's programme for the control of money . In a curious way it is an inversion of the macro monetarists . Friedman, Harry Johnson and their Chicago colleagues, always saw the control of money as offering a path to influence every pore of a country's economic life without direct intervention by the state . The state could adjust the supply of money, and autonomous citizens would respond according to their felicific calculus . The problem for the monetarists has always been that the state does not have monopoly control of the supply of money in a modern credit economy . For Hilferding, as for Richard Minns, the nationalisation of the banks would give the state that control which it could use for progressive purposes . The question for Richard Minns as for Rudolf Hilferding, is whether in an economy of private industrial capitalists, the socialist government control of the issue of money alters the character of money as capital . If a nationalised bank issued long-term credit to a firm which could not repay, what would happen to the financial system? Would the state bank devalue the capital and bankrupt the firm? If it did not receive interest, how would it finance new investment? Would it create money, and if so within what limits? What would happen to the rate of exchange of this nationalised currency? I would suggest that as long as money performs the role that it has always done in capitalism, as a medium of exchange, and means of payment, a store of value, a unit of account, and above all as the money form of capital, then the socialist control of money cannot alter its character . For the nature of money is determined by its part in the process of economic reproduction . If this

PENSION FUNDS process remains capitalist (with private ownership of the means of production, and circulation via a market) then money will be called upon to play a particular role, regardless of who formally controls it . My argument has been that many of the criticisms of British financial institutions in this country should be seen first as criticisms of money as capital ruled by the law of value rather than criticisms of the financial institutions as such . Overseas investment, investment in property, selling out in dawn raids, the paucity of venture capital, all might be expected from money capital which seeks maximum self-expansion . The institutions are bearers of these forces, and we may see them as doing their job too well as they shun long-term investment, manufacturing industry, and the British economy . Having said this, however, two further points arise . First, the law of value as imposed through the market is problematic for capital . The size of investments and their gestation periods are expanding and this increases the uncertainty of any long-term profitability . Industrial capital needs long-term finance, but money capital as such whose essence is self-expansion - is no longer an adequate source . Similarly the market's traditional mechanisms of crisis and restructuring are increasingly selfwounding . As the direct interdependence of production grows, so does the severity of a crisis of restructuring since new planned systems of production have to be introduced on an ever wide scale . It is not just a question of the bankruptcy of a small firm and the transfer of its assets to a larger more productive one . It is rather one of massive devaluations, affecting simulatenously great aggregations of capital and whole national economies .

Financial institutions are inadequate 95 because money capital guided by the loadstar of market profitability is inadequate, not because the institutions as institutions are at fault . This leads to the second point, which is the extent to which finance can be insulated from the daily discipline of market profitability (the law of value) . Can institutions be set up which perform the functions of financial institutions as providers of long-term finance, as active restructurers - but obey other economic laws? This is the main issue of this paper . I have not wanted to play down the importance of institutional change, or the question of ownership. But both must be seen in terms of alternative economic forces . If we nationalise the banks we do not abolish the law of value . It reimposes itself through the international money and commodity markets, and through the role of money in the internal capitalist economy . But we can insulate at least part of the national economy from the immediate laws of the market . This is particularly important with respect to the restructuring of production, for it is on this that long-term competitivity (or put another way, longterm insulation from the international law of value) depends . It is then in terms of an alternative economics of production, rather than a modified economics of circulation (the provision of long-term capital, the modification of the exchanges and interest rates) that the change of ownership and control of financial institutions should be judged . The national and local significance of pensions funds . Pension funds have to come to play a major part in UK finance . Their size has grown from £3 billion in the late fifties to £64 billion in 1982 . Of this £8 .66 billion

CAPITAL & CLASS % (14%) is in local authority funds, and £18 .66 billion (29%) in other public sector funds . As finance they have a number of distinct features : (i) The final purpose of pensions is use values rather than exchange values . The retired pensioner wishes to consume goods, rather than re-invest . The pension in money form should thus be seen as primarily a medium of circulation, and the employer's liability ultimately a liability to provide use values . (ii) They are not intrinsically selfexpanding . Whereas banking capital has its only meaning as self-expanding value (moving from M-M'), pensions have a different logic . They take the form of wage payments paid after the worker has ceased to work . In private pension schemes the employer's liability builds up during a labourer's active working life . This is why pensions are often seen as a deferred wage . But in fact they amount to no more than a liability, and the history of pensions is a history of the nominal size of this liability, its guarantee, and its funding . Pension funds are one way in which this liability can be met . But they are only one way . Current liabilities can be funded by current contributions or from the employer's current general income (pay-as-you-go) . This is effectively what happens in state insurance . In these cases pensions are not paid out of accrued money capital but out of income . This point is clearest when pensions are non-contributory - as they could be and have been in certain periods . Contributions make it appear that pensions are paid out of capital - the invested worker's wages - but in macro terms (and intrinsically) there is no necessity for them to be so. (iii) Since pensions are closely tied to wages and work, they are subject to decentralised agreement by employers and

workers, and therefore are subject to collective bargaining . The question of the control - and within limits the use of pension funds does not depend on state action, but can be contested by organised labour (the Lucas shop stewards combine is an early example) . Local authority pensions funds have further characteristics : (iv) They are index-linked (thus guaranteeing inflation proof pensions) and thus involve a liability of a constant real value, approximating to a constant purchasing power or bundle of use values . There is thus no commercial risk for a local authority contributor . (v) Shortfalls are funded by the local council, effectively from taxes . Rate funds are not capital . They have no requirement to expand . Rather they are a transfer from private income to (in this case) former state employees . As a matter of practice the guarantees are paid into the pension fund following five year actuarial revaluations, so that they become capital prior to their pay out as pensions . (vi) Since contibutions by both employer and employee are funded from taxes, and since the guarantees are likewise paid from the rate fund, we can see local authority pensions as a relation between rate payers and former council employees, and local authority pensions funds as a relation between the timing of rate payments to settle a future liability . (vii) With private company schemes, workers clearly have an interest in an independent fund as a guarantee of their future pensions because of the danger of the company disappearing or not being able to pay when the pension is due . This is much less the case with a local authority . The local authorities power to tax provides a much firmer guarantee and makes funding less necessary . When considering the use of local

PENSION FUNDS authority pension funds, therefore, we should not be misled as to their nature . They are merely a device for setting aside rates and government grants to meet an eventual liability, constant in use value terms . There is no necessity for them to be used as capital . If they do not earn the maximum rate of return, then current rates may make up the difference . Indeed they could in principle be entirely funded by current rates, or by current rates plus curent contributions (in the GLC fund total outgoings in 1980-81 were £30 .2 million, while current contributions excluding investment income - were £52 .5 million) . The point here is that there are strong pressures for local authority pension funds to treat those funds as capital . The Local Government Superannuation Regulations 1974 require surplus funds to be invested in accordance with a modified version of the Trustees Investment Act 1961 . This lays down guidelines for investment . For example, it requires that the fund be administered with the advice of qualified financial consultants, that the fund be diversified, and that no more than 10% of investment be in unquoted companies .

However the emphasis of the Act is 97 on prudence rather than maximisation . Under the heading of diversification , divergence from immediate profit maximisation may be justified . Most significant, up to 25% of the Fund can be used for purposes for which Local Councils have statutory borrowing powers . The Council acts not as trustees but as if they were trustees . It can immediately be seen that there is considerable leeway in how these funds are used. In 1982 the GLC Pension Fund has assets amounting to £556 million, with 39,000 contributors and 22,000 beneficiaries . Its administration is formally in the hands of the Finance and General Purposes Committee, but it is effectively managed by officials in the Finance Department with a team of City advisers . It has been run on conventional lines, treating the fund as capital . The recent report on investments says `The Fund must be maximised within an acceptable and minimum pattern of risk . Both prudence and legal requirements dictate a wide diversification of investments' . This is reflected in Table 1 below :

Table 1- GLC Funds 1978-82

GLC

Fixed interest UK equities Overseas equities Property Other ('short-term' and cash)

1981-2 Other Private Local Sector Authorities Funds

1978

1982

35 38 19

23 41 7 23

27 40 17 10

24 27 28 15

8

6

6

6

Source : CIPFA (Chartered Institute of Public Finance and Accountancy) C. & C . 20-G

CAPITAL & CLASS 98

This indicates a lower proportion of overseas equities than the norm, and a higher proportion of property . Within property, however, there was a low proportion of investment in Central London . As with overseas investment, these divergences were undertaken for policy reasons . In the past few years the policy has been to restore the `normal proportions' - that is to say further insulate the fund from policy considerations . Thus last year 50% of investments went overseas, and significant property investments have been made in London . The GLC Labour Manifesto of 1981 contained two commitments vis-a-vis the Pension Fund : (a) to give the members of the Fund the GLC employees - a full say in its administration and investment . A panel of 27 has now been set up consisting of 9 members and 18 union representatives, with the unions representing pensioners and those contributors not in a union ; (b) to persuade the Fund `to invest a substantial and increasing proportion of the cash flow of the fund to GLEB' (Greater London Enterprise Board) . In 1981-2 the surplus for investment of the Fund was £65 million . This is the stage at which we are now . There are two directions for advance . The first is the more modest in that it recognises the Fund as capital and works within those broad limits . Already, the GLC Fund - as the result of initiatives by Finance officers - have invested in a CIPFA consortium for the finance of small industrial premises . This is a sector of the market which until recently was avoided by private property companies, in part because of the costs of management . The GLC fund justified its investment on grounds of diversification, in that they have no investment in that

branch of the property market . But there is a wide scope for the Fund to play in the projects which GLEB (and the Council) are currently putting together, even given conventional interpretation of the nature of the Fund . The most immediate area is property . In all five major rescue attempts we have been involved in to date, the financing of the factories has been a central lever . The GLC has powers under the 1963 Local Authority Land Act to invest in land and buildings, but may contribute only 90% of the value that should be secured on a mortgage . Nor may GLEB use the GLC's money for this purpose other than as an agent . The mortgage still has to be held by the GLC, and GLEB's independence is thereby limited . The aim of the Act, and the modifications in the 1982 Miscellaneous Provisions Act, was to involve private sector finance . For this purpose GLC Pension Fund money can be used as private finance, either to fund all property operations, or to complement GLC funding . Secondly, all these investments have had two parts : the first is commercial . For example, property has to be valued at market prices (though property valuation is hardly science or art - but rather a question of convenient formula) . Interest on loans has to be charged at market rates . The second part of GLC agreements has been sub-commercial . We have provided revenue funds to make up the difference between expected performane and the normal rate of return . We thus are able to subsidise interest rates (as the West Midlands do), or rents, or provide contributions to other running costs . It has proved quite possible to involve private sector funds in the commercial parts of the package : Barclays have invested in two of the schemes, the Midland Bank in a third.

PENSION FUNDS There is no reason why the GLC should not invest likewise, even in equity, given that foreign securities (unquoted on the London market, but quoted overseas) are no longer included in the 10% limit on unquoted company investment . The usefulness of the Pension Fund, as with all internal sources of financing, is that it can be synchronised more easily with the rest of the package . Thirdly, the Fund is legally permitted to spend up to 25% of its value on capital investment for which the Council has statutory borrowing powers . Given the restrictions currently being imposed on capital spending in the GLC (£10 million in 1983/84), this would enable a significant increase in capital available for industrial investment undertaken directly by the GLC . Fourthly, the Fund could invest more generally in GLEB projects without specific guarantees (e .g ., through a charge on project assets), but with the guarantee of a given rate of return by GLEB . This might take the form of fixed interest loans (the GLEB equivalent of gilts) or of loans with a base rate guaranteed but no limit on maximum returns . There is, of course, an issue about guarantees . Why should the GLC via GLEB shoulder the risk at the expense of private capital? The point in general holds water, but is clearly not applicable in the case of the GLC's own Pension Fund . Given an expected actuarial liability, the GLC will have to make up any shortfall directly from the rates . A guarantee given by GLEE merely obviates the need for guarantee payments by the GLC on that part of the Fund capital. If the Fund's investment earns more than the expected rate of return, this - ceteris paribus - reduces the deficit to be made up from the rates on the Fund as a whole . Hence in the case of Pension

Fund money, guarantees can be given in 99 the knowledge that this is effectively a self-guarantee . For this reason, the Council should be able to borrow more cheaply from the Pension Fund than on the open market - particularly if the guarantee rate is taken as the rate on gilts . An alternative form of guarantee would be of capital losses on a particular investment rather than on an overall rate of return . The significance of local authority pension funds in the above cases is : (a) it allows local authority instruments such as the GLEB, or the Council itself, to get round certain government restrictions on capital spending and property investment ; (b) because of the guarantees which it makes sense for the Council and GLEB to offer to pension fund investments, it should be possible to obtain funds at lower interest rates and for longer-term periods than ordinary commercial loans . (It should be remembered that GLEE and the Council would be offering the fund something it would not normally get in the open market - even were it to lend to other local authorities and public bodies - and that is hard guarantees) ; (c) given that it would effectively be a source of internal finance, it could be more easily managed as part of an overall package . There remains the question of the best means of investment . One proposal we are considering is a financial subsidiary of GLEB to manage pension fund investment . This fund would have an overall guaranteed rate of return, and individual investments would be left for it to manage . This has the advantage of avoiding the formal procedures of Council assessment, and placing control of the funds directly in the hands of

CAPITAL & CLASS 100 GLEE financial officers . West Midlands

have pioneeered this approach, and are involved in developing different types of funds of this sort, one for the inner city, another for a particular sector . The above I see as the minimum use that can be made of pension funds . The proposals acknowledge the requirements of the pension fund as capital, but use this capital for wider purposes. One of the dangers of public investment bodies such as GLEE seeking external funds is that they gear their investment criteria to those of the financial market (see for example the Scottish Development Authority) or make a compromise which still ties broad policy to the law of value . This I regard as unnecessary . It is quite possible to separate any investment into its commercial and subcommercial components . Pension funds may be incorporated in the first .

The question remains : how much further can pension funds be taken? Can they be of wider use than a secure, internally managed commercial source of finance? To begin with, direct control by an investment panel composed of unions and councillors can direct the funds in the commercial market to link in with the Council's wider economic and political policies . For instance the Council operates an early warning system to indicate which plants in London are threatened with redundancy or closure . Major firms identified can then be talked to and offered some carrots if necessary. There are also some sticks : GLC's purchasing powers are one such (for instance Plessey has recently announced a closure in Romford and we have found it is bidding for a large computer project for the London Fire Brigade) ; our planning powers are another (which we in-

Twenty Largest Equity Holdings at 31st March 1982 Position 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

Company

British Petroleum Co . plc Shell Transport and Trading Co . Ltd . BAT Industries, plc General Electric Co . plc Marks and Spencer, plc Barclays Bank, plc Beecham Group Ltd. Prudential Group, Ltd. Imperial Chemical Industries, plc Lloyds Bank Ltd . BTR, plc

Boots Co . Ltd . Grand Metropolitan, plc BPB Industries, plc Royal Insurance, plc Northern Foods, plc National Westminster Bank, plc Rio Tinto-Zinc Corp ., plc Hanson Trust, plc Unilever, plc

Market Value (£000) 8,990 8,213 6,270 5,245 3,813 3,790 3,259 3,237 3,228 3,198 3,006 2,994 2,943 2,800 2,700 2,667 2,653 2,653 2,592 2,571

PENSION FUNDS vestigated in relation to the closure of Hoover's in West London) . The Pension Fund's investments are a third . Table 2 shows the largest 20 holdings of the Pension Fund in British equities . Large manufacturing companies are significantly under represented, but many have substantial operations in London, and two have recently been involved with the Council in discussions about closures . There are many other policies for which pension funds could be used as a lever . The GLC is currently starting a contracts compliance unit which seeks to use its purchasing power to induce employers to put into practice the principles of Equal Opportunity legislation . Pension fund investment could be used similarly . The GLC has used its purchasing power in RTZ and Shell to object to policies followed in the third world, particularly in South Africa . The American unions are using pension fund power over these and wider fronts . What is needed in this respect is coordination between authorities . The GLC fund at the moment restricts its investments in any one firm . For instance the £9 million invested in BP is only 4% of the £229 million invested in UK equities, and less than 2% of the fund as a whole . It also represents only a small proportion of BP shares . However, together the major local authority and public sector shares would control a substantial proportion of the major companies shares . Richard Minns estimates 20% of all UK equities are held by pension funds, but in individual cases this will be significantly higher . The West Midlands have taken the lead in trying to co-ordinate local authorities pension funds in this regard, and to build parallel systems to those in the United States where the trade unions have developed a computer

system on company information and 101 pension fund holdings . The wider issue, however, is whether it is possible to break the close link between pension funds and commercial rates of return . Given the inadequacy of profit as a guide to major long-term investments, what is necessary is a fund which can be used for restructuring without the constant discipline of the money market hanging over it . There are strong arguments why pension funds should be used for this purpose : they derive from the rates whose purpose is more generally to provide services and infrastructure for Londoners . The longterm economic health of London is in the interests of those who work in London, both as citizens, and (with some mediation by the rate support grant) because the future rate income will in part depend on the general level of economic activity . Most important of all, if the restructuring of production of London is to take place in a way different to the process as organised by capital, if it is to be a restructuring in the interests of labour both as workers and consumers, then the GLC employees as workers have a clear interest in providing a source of finance for this end . This brings me to the final emphasis of this paper . The main issue in the UK (and in London) at the moment is restructuring . Capital through monetarism is carrying through their version of restructuring at the expense of labour, with enormous waste, and with fearful consequences so far as the state of the world economy is concerned . The task of socialists is to resist this version, and instead to work through alternative versions which we have called restructuring for labour . This involves workers, and socialist controlled authorities, developing projects which can hold ther own in

CAPITAL & CLASS 102 the long run, but which produce outputs which are directly related to working people's needs, in ways which build on the skills of labour rather than deskilling them . The main problem in this process is the construction of the projects . In this sense, the Cork group in the Wilson report is right, though they envisage the process of restructuring taking place in another way . Finance is one part of this package, but only a part . It cannot lead it . In our first year of operation we have found money to be the least of our problems : at times it has even been a negative factor . However, the particular character of pension funds as not inherently capital, means that they can usefully be used (even with procedures which regard them as capital), and in the longer term may be the source for supporting a much wider programme of restructuring than any individual local authority or group of workers can currently mount .

Robin Murray is Chief Economic Adviser to the Greater London Council

Notes 1 This is the text of a paper delivered on 21 January 1983 at the Future of Finance Conference organised by the Open University Financial Studies Group . Review the 2 Committee to Functioning of Financial Institutions (1980) Report, Chairman the Right Honourable Sir Harold Wilson, HMSO Cmnd 7937 . 3 Ibid p . 271 . 4 Ibid p . 271 5 Ibid pp . 265 and 272 6 J Coakley and L Harris (1982) `Evaluating the role of the financial system' in D Currie and M Sawyer (eds) Socialist Economic Review 1982 Merlin . 7 Richard Minns (1982) Take Over the City, Pluto .

PENSION FUNDS 103

Richard Minns

Pension Funds : An alternative view

104

This article argues that control over the supply of finance is an important issue for the left and that such control and the challenging of City views are necessary for the restructuring of capital . It is argued that despite the fact that all pension funds are capitalist, some part of their cash flow needs to be tapped and controlled if local authorities hope to have any appreciable impact on their local economies . Without such control over finance the possibilities for restructuring are seen as very limited .

PENSION FUNDS-ALTERNATIVE VIEW of how far we have moved on in our thinking over the last few years, that we can now discuss boring old local government in the same breath as the restructuring of British industry and the role of financial capital . In this sense, Robin Murray's article raises, for me at least, a vitally important issue at the present time, namely, `what existing local authorities can do . . . to use pension funds for the purpose of long-term investment .' As he rightly states, `part of the importance of these local initiatives is that they are testing the social control of finance in practice, and they are testing it as one part of a much wider investment strategy .' His article proceeds to question a number of points which critics of the City have raised. What emerges from the argument is that there seems to be some confusion amongst those involved in these issues not only about the political purpose of local initiatives, especially so far as pension funds are concerned, but also about what direction we should take in economic terms at the local level . This follows on from difference of view about the City and its importance in Britain . Firstly, I want to briefly summarise Robin Murray's line of thinking, and then to tackle the major points . In a nutshell, what he argues is that it is mistaken to attack the City for not providing long-term funds for investment in British industry . Finance is not the crucial problem - rather the issue is one of restructuring British industry, after which the necessary finance for profitable investment is a secondary issue . The City is only an expression of money capital which seeks maximum self-expansion through profitable investment . This, in turn, has implications for local initiatives . Pension funds can be used in various ways which build on their capiIT IS INDICATIVE

talist nature while the local authority can 105 provide additional finance of its own to broaden the purpose of intervention and investment and to `restructure for labour' . This is a very crude oversimplification, but it goes to the heart of the issue - what is the role of the City and its financial institutions, and what position should local authorities adopt? Let me now deal with some of the main points in more detail .

Does finance matter? Robin Murray begins by attacking the view that the financial institutions are a major cause of UK economic decline . The fact that they fail to provide long-term investment funds, he argues, that they increasingly invest overseas, and that they invest in unproductive assets, arises because there is a lack of profitable projects in the productive sphere in the UK, a view taken by the City itself as Robin Murray points out . Capitalist money has an `intrinsic character, which, like capital in general is to drive always for maximum selfexpansion .' It invests in property, overseas assets, and the shares of large corporations rather than smaller untried ventures because it is simply more profitable to do so . Further, `at a moment of crisis money capital is withdrawn from the circuit of productive capital . The crisis is reflected in the monetary sphere, but the monetary sphere does not cause the crisis .' There is therefore in Robin Murray's view, probably something temporary about the current problem . Once the crisis is over, money capital will flow back into the circuit of productive capital . There are signs of something occurring already, according to this

CAPITAL & CLASS 106 argument . In the GLC's experience, major clearing banks such as Barclays and Midland, have been taking a longerterm view in order to forestall company collapse . Along with the Bank of England, `all these financial institutions have a self-interest in . . . preserving a productive industry capable of reproducing profits in the long-run .' In fact, the financial system is apparently 'operating an alternative industrial policy to the government, more active in its intervention and less short-term in its financial criteria .' The issue anyway, according to Robin Murray, is not whether there is an absence of long-term funds, the problem is industrial restructuring and planning . The criticism of financial instutions is not their short term horizons but their incapacity to actively develop new projects - `long term finance without detailed plans for restructuring will be of limited value as far as projects which will be profitable in the long term are concerned .' I feel that there are a number of fundamental points here ; disagreement on them affects any subsequent argument . Basically I do not feel that we can take theoretical concepts of money capital and circuits, and just read off from these what is occurring in Britain . In fact, Robin Murray also has trouble with this because he uses various concepts interchangeably to deal with the problem of theoretical and empirical analysis ; see his use of `finance', `financial institutions', `money capital', `banking capital', `issue of money', and even 'finance capital' . In some cases theory swamps the empirical, as in his reference to money capital being withdrawn from the circuit of productive capital in a moment of crisis . As I understand the historical evidence, the remote, or with-

drawn relationship of financial capital (the institutions broadly summed up in the concept `the City') to productive capital (manufacturing and certain service industries) has a long history' which is more substantial than that reflected in what I take Robin Murray to be referring to as the present crisis of the last ten years or so . In other cases, the empirical swamps the theoretical . The fact that the GLC has found a number of financial institutions taking a longer term view and presumably willing to finance GLC projects does not convince me that their position has changed. Barclays and the Midland may well have their industrial first-aid developments ; but how long was the institutions' new found long-term view in the cases of Stone-Platt and Airfix where financial reconstruction was followed by the same institutions pulling out after a year? Even in the huge reconstruction of Massey Ferguson, the institutions had more to lose by collapsing the company as their first option, than by writing off some debt and converting some other to equity or risk capital . This in no way can be construed as `preserving a productive industry capable of reproducing profits in the long run .' It is equally the same shortterm view being demonstrated . Banks seek maximum security on the assets of a company before any loan is forthcoming . In the case of financial trouble in a company, their reaction is `how do we get out?' By calling in a receiver they can sell assets and retrieve their loan . In some cases, the collapse of markets may make the assets worth less than the books show, and in these cases, the banks can get out with what they can, or they may be pressurised to stay in if there is too much to lose . Even the Industrial and Commercial Finance

PENSION FUNDS-ALTERNATIVE VIEW Corporation (ICFC), the largest development capital organisation in the UK, tends to operate rather like a conventional bank, and ICFC was set up by the banks in 1946 to provide more risk finance to industry . The City is essentially an international centre of finance . It does not exist, historically, to finance British industry . Even a bank, like the Midland Bank, more involved than most with lending to British industry, has been diversifying substantially into overseas banking . It describes itself as `an international banking group' and its recent substantial acquisition of the Crocker National Corporation in California (as well as others such as the majority stake in Handelsfinanz in Switzerland) is seen as part of its `long term plan' (sic) for the international expansion of the Midland Bank . The financing of overseas ventures and foreign governments is the City's traditional role . However, I do not accept that this efficient, successful (in capitalist terms) group of financial institutions, is actually so successful even in its own terms . It makes mistakes, like the recent problems with sovereign debt in countries like Mexcio and Poland . Other mistakes like the over commitment to property in the 1970s were baled out by the state . Its activities centre on world wide financial operations' rather than allying itself constructively for the long-term with any particular productive capital (however defined) . This I feel is equally risky, in capitalist terms, because it involves a succession of shortterm views of the location of the production of surplus value (to use the jargon) . But then, even in theoretical terms, capitalism is based on contradictions and this does not preclude financial capital .

How successful have pension funds 107 been - again in capitalist terms - in this system? Very few pension funds are in fact financial institutions . Most are just balance sheets which are effectively run by another institution - merchant bank, stockbroker, insurance company and others . At least 50 per cent of all pension fund assets are managed by merchant banks alone . These institutions obtain fees for management, as well as other more concealed benefits .' Stockbrokers, of course, receive dealing fees . Pension funds have nevertheless failed to produce real rates of return . Stockbrokers Phillips and Drew have shown that the average private pension fund achieved an annual rate of return of 9 .1% over 18 years to 1981, compared with average increases in earnings of 11 .9%°. Since pensions are linked to salaries, and most actuaries assume real returns of at least 2%, this represents a significant real loss for pensioners . But it has provided the City with some short-term income, and while this has been going on, the City has been moving more into international fund management . Robin Murray's question is the right one - why should the institutions invest in British industry when all these other avenues are open to them . The answer, however, is wrong . It is not necessarily the case that a series of shortterm profitable outlets creates the conditions for greater returns in the long-term than commitment to one productive base does . The City has not invested in British industry, not because it is necessarily unprofitable in the long term, but to put it crudely, because current income is available elsewhere . The issue is the assessment of risk and security, which is different in Britain compared to countries like Germany and Japan . This is because of the different

CAPITAL & CLASS 108 approach and international role of financial capital in Britain, however counterproductive this may be to the financial institutions and to pension funds in the longer-term . This issue is the availability of long-term finance, no matter how much restructuring is undertaken . According to the Banking Information Service,' the official defenders of the banking faith, the banks of overseas countries are not less profitable than British banks (as a result of taking a radically different approach, we might add) : the political danger of Robin Murray's line of argument is that we will spend more time controlling industry and restructuring, and less time on how to control the financial institutions . Of course restructuring is necessary . No one, I think, has ever referred to the issue of controlling finance without considering the need to link it closely with the planning of production, in one form or another . British industry is too far gone after decades of lack of investment and long-term risk finance to think that finance is the be all and end all . What is at issue is the degree of emphasis given to different parts of the equation . For example, although restructuring is not defined in detail in the article, it might well of course include financial restructuring . This can arise where a company has invested in new plant and machinery, but in order to do so it has borrowed heavily . A classic case in the Midlands has been the ferrous and nonferrous foundry aid schemes during the 1970s . These provided grants for a part of the cost of capital investment . Companies had to borrow the major part of the expenditure to make up the difference between the costs and grants . By the end of the 1970s this created a crippling interest rate burden . The ludicrous capitalist situation was emerging

where companies which had not invested and borrowed could just about struggle on in the recession while those, not necessarily in the same sector, that were more efficient and had restructured would go bust . These companies needed injections of equity capital either for the original capital investment or for subsequent working capital . Basically, in this and other companies, the most appropriate type of finance for capital investment, for working capital and even for mergers, acquisitions and demergers, is not available - even when the company is successfully restructured and has significant growth potential . Whoever initiates the restructuring, industry or the state, finance too needs to be controlled because it will not offer itself. Financial capital in the UK operates differently to financial capital in, say, Japan, and has traditionally done so . The lending by the Japanese banks was controlled and directed by the government into priority industries . 6 It was not a matter of restructuring Japanese industry and then waiting for the banks to play their part . The problem of finance for industry in Britain is not just a reflection of a crisis in industry as a result of industrial decline over the last 10, 20 or even 30 years . The political role of the City complements this . The City has successfully pressed for economic measures which benefit its international position rather than that of industry in Britain . This may partly explain why industry is increasingly locating overseas . Be that as it may, Robin Murray criticises this argument that the financial institutions are an economic estate . Far be it from me to defend Coakley and Harris who are cited as the latest proponents of this analysis, but it appears to me that Robin Murray has begun to throw the baby out with the

PENSION FUNDS-ALTERNATIVE VIEW bath water . He argues that control of this estate in order to lower interest and exchange rates is not enough for industrial revival and I suppose that it is true . But Coakley and Harris state the following : `Control and nationalisation of the financial institutions is only viable if it is part of a policy to nationalise industrial firms themselves and thereby control their activities directly ." In addition, as an analysis of the political power of the City which works alongside the City's approach to investment and risk assessment, the work of Coakley and Harris and others, is an essential part of the equation. Robin Murray tends to reduce everything to restructuring . Next, he draws our attention to the argument advanced by others `that the financial institutions are now the commanding heights of the economy, and that their nationalisation will give a socialist government control over finance and industry' . Arguments of this sort he attributes to me, and to Rudolf Hildering . What is said by Robin Murray is, `If we nationalise the banks we do not abolish the law of value .' In other words, nothing would change . `Criticism of British financial institutions should be criticisms of money as capital ruled by the law of value rather than criticisms of the financial institutions as such .' In my view this is an oversimplification which can emerge from reading off empirical events from the categories of the law of value . I believe that the institutions are different from the concept of money as capital . These theoretical categories direct our thinking, but they are very general . Within the concept, different manifestations of money capital, in this case British financial institutions, operate in a range of ways and guises in order to seek successfully

or not, the maximum self-expansion . Just because a law of value exists, this does not mean all institutions in different nation states will operate in the same way empirically . British financial institutions seek self-expansion in an international role full of short-term assessments of speculation and surplus value extraction . Japanese financial institutions seek self-expansion in a national role linked to long-term risk taking and development in Japanese industry . In this context I do not agree at all that necessarily `overseas investment, investment in property, selling out in dawn raids, the paucity of venture capital, all might be expected from money capital which seeks maximum self-expansion .' The proposals I want to put forward still basically add up to capitalism, with that I agree . But intervention can at the same time be based on the advancement of socialist principles, such as greater accountability of capital (industrial and financial) to the workforce and to the community, and greater planning of investment and production in Britain which is less wasteful of human and environmental resources . Finance needs to be controlled in order to do this . However, Robin Murray has an alternative . This is his suggestion that `we can insulate at least part of the national economy from the immediate laws of the market . This' he continues, `is particularly important with respect to the restructuring of production, for it is on this that long-term competitivity depends .' Robin Murray is considering projects which `restructure for labour' as opposed to capital . These may involve better wages and working conditions which may put a company at a disadvantage in the market against others which have been restructured by and for capital . However, these projects must

109



CAPITAL & CLASS 110 `hold their own in the long run' . How this requirement squares with 'restructuring for labour' is not explained . But let us examine in more detail the basis for creating an `alternative economics of production .' This brings us on specifically to consider pension funds and local government initiatives .

The case for mobilising local authority pension funds Robin Murray argues that pension funds have distinct features as finance . `They are not intrinsically self-expanding, because they aim to produce use-values

for pensioners, rather than reinvestment.' Pensions could indeed be paid out of current revenue (rates or taxation), rather than out of a fund . But does this mean that pension funds are not capital? Presumably most people who insure themselves or their property are concerned with income, use values, for themselves or dependents, rather than reinvestment. In addition, insurance could be run completely by the state out of current revenue (and for various purposes, such as health and unemployment, to a large extent it is) . But does this mean that insurance companies are not capital? Is the majority of money at

SOCIALIST ECONOMIC REVIEW 1983 Socialist Economic Review 1983 is the third volume in a unique series, designed to combine detailed economic analysis with a thorough examination of the alternative economic strategies of the labour movement . The Review is an independent forum for debate amongst economists across the political spectrum of the Left . This year's Review surveys Keynesian and Marxist views of the UK's economic decline . It offers a detailed examination of the labour market, state control and local authority expenditure. Contributors grapple with the problems of planning, youth training schemes and feminist policies . Drawing on the international context one article analyses the experience of Papandreou's economic policies in Greece whilst another studies the propspects of the OPEC economies in the 1980s . The final section deals with the economic mechanisms of planning and their political implications in both the UK and East European countries . Socialist Economic Review here demonstrates how politics and democracy are an integral part of any serious economic discussion . Price £5 .95

ISBN 085036 302 0

Merlin Press, 3 Manchester Rd, London E14 . 01-987 7959

PENSION FUNDS-ALTERNATIVE VIEW the disposal of building societies or banks saving for a rainy day and for daily running expenses (income, use values), or does it accumulate for reinvestment? Maybe, it is a bit of both . But the line of argument confuses the concept with its purpose . Whatever its purpose, it functions as capital . Even if we scrap pension funds tomorrow for some alternative system, the accumulated assets are capital . Furthermore, local authority pension funds may well be guaranteed by local authorities through the rates: therefore technically it does not matter to future pensioners if there is a deficit . But they are still capital because of their place in the structure of British finance and the City . Even if we could agree that they were not, politically they will be treated as such . Let us try to use a pension fund in a project which protects jobs with no prospect of long-term survival and then let us guess which way a court's decision will go . Hence the importance of the political battle with the City because its views about finance, prudence, security, benefits, duties, permeate other structures of society, in particular the courts and central and local administrations, as many of us are finding . It is worth noting that there is no legal requirement in any pension fund, public or private, to invest for the maximum return . The duty is to invest prudently and not to deliberately lose money. As Robin Murray says, there is much flexibility in how the funds can be used . Take for example, no less august a body than the National Association of Pension Funds (every investment manager's minder) . Even it has taken a broad view on this subject ; in response to a consultation document drawn up by the Lord Chancellor's Law Reform Committee it stated :

`The primary obligation of the trustees of a pension fund is provision of the intended benefits and these, in many cases, are linked to salary shortly before retirement or some similar concept . The liabilities often do not materialise for some two generations and the incidence of new money available for investment from contributions of the employer and employees is such that investments rarely require to be realised to meet benefit obligations . Thus the trustees of a pension fund are under pressure to invest with a view to appreciation, whether of capital or income, and may therefore feel the existing concepts of investment, are not appropriate . In consequence pension fund trustees have regard for long term considerations including the possible purchase of nonincome producing assets or income producing assets, on assumptions as to future market and economic conditions which, in the context of family trusts, would be regarded as speculative . It follows that the term "investment" may, in relation to pension schemes, but not necessarily in relation to family trusts, include the purchase of assets which will yield a profit only upon sale and the purchase of assets justified only on the broad view that such purchase being good for the national economy is also good for trade in general and for pension schemes in particular ." It is uncertain how broadly this can be interpreted, but I doubt whether it could be used to justify a policy of restructuring for labour with all the connotations that it entails . Pension funds are also, of course, related to wages and work . Their control can therefore be contested by organised labour, as Robin Murray points out . I would just like to add that this is more problematic than it would seem . Many

111

CAPITAL & CLASS 112 trade unionists are concerned about the loss of jobs in the UK, especially when they see pension funds being invested overseas . But when they become pension fund trustees they need to be supplied with a lot of detailed arguments in order to tackle the City's view . This is where Robin Murray's line of thinking will let them down . They need to know how they can divert some of the finance into industry . The only line that in my view will work is to argue that investment in industry, through local enterprise boards or whatever, will produce returns to the fund, and there will be no call on the rates in the case of a local authority fund . Trustees need to show the comparatively poor rates of return elsewhere ; they can point to enterprise boards as organisations which can put together investment deals which the funds themselves are not equipped to do . As far as restructuring for labour is concerned, we can get away with arguing for an increase in the accountability of firms to their workforce and the community on the grounds that this is responsible investment and in the long-term interest of the firm . If we want to advance anywhere near controlling the financial institutions for productive investment, then that is the political reality . But perhaps this is premature : Robin Murray cites some examples and proposals from the GLC. First, it is suggested that the GLC pension fund could be used to finance the property side of rescue deals in which the GLC gets involved . Property investment is of course nothing new to pension funds . Second, private finance is used in the commercial part of GLC projects generally, with revenue finance used to subsidise interest rates and rents to make up the difference between expected performance and the normal rate of return . It is proposed that the GLC fund

could be used in the same way as private finance, even providing equity . The West Midlands Council is said to be subsidising interest rates out of revenue already . This is in fact as part of an arrangement with ICFC whereby an interest rate subsidy on loans made to companies in the Midlands by ICFC is given in exchange for a planning agreement specifying employment targets and various industrial relations conditions . As a personal view, I do not accept the logic politically for subsidising interest rates in this way, expecially with an organisation like ICFC where we effectively contribute to clearing bank profits out of ratepayers' money . But then many of these economic policies are the result of pressures and compromises . Thirdly, the fund is allowed to spend 25% of its value on capital investment for which the Council itself has statutory borrowing powers . However, where fund money is used by the Council, the statutory borrowing power is to be deemed to have been exercised as though a loan of the same amount had been raised : in other words, it is not a way round government restrictions on capital spending . Fourthly, the fund could invest in Greater London Enterprise Board (GLEB) projects with a guarantee given by GLEB itself. Because this is said to be a self-guarantee, it is argued that the Council should be able to borrow more cheaply from the pension fund than on the open market - `particularly if the guarantee rate is taken as the rate on gilts' . It is unlikely to be so, because gilts are marketable, while GLEB guarantees are not (or at least not yet) . So a premium will have to be paid for this . The philosophy behind these proposals is to avoid gearing investment criteria to those of the financial market .

PENSION FUNDS-ALTERNATIVE VIEW would be able to separate investment into commercial and 'subcommercial' components, and put pension funds into the former . It may be possible to do this, but of course it does not challenge anything that financial institutions do - and this is consistent with the analysis in the first part of Robin Murray's article . Pension funds will be given property investments, security or a guarantee - otherwise the funds will want to know what happens when the present GLC administration ends . If the investments are made in the interest of restructuring for labour, the funds will want this security and guarantees . They will want to know that they will come out of it fully protected. But I would suggest that the challenge is to make pension funds do what they would otherwise not do . This is to provide longterm risk finance with no guarantees and minimal security . The challenge is in getting them to do this . But this of course is based on an alternative view about the need to control the financial institutions in the interests of people in this country, on the grounds that they are not serving the economy, other workers and future pensioners well even GLEB

in their own terms .

In the West Midlands the Council has established the West Midlands Enterprise Board to invest sums of around £100,000 to £750,000 in equity and loan finance for medium sized firms in the West Midlands . The Council has allocated £4 .3m from the rate fund to the Board, and by March 1983, £3m had been invested or allocated in ten companies . The Council then set out to establish a specialised fund of up to £6m ; £3m of this to be provided by the Board itself (via rate fund finance from the Council) and the balance of the fund provided by pension funds, including C. 6 C.

20-H

local authority pension funds . It will be a `closed end' fund which means that there will be an identifiable portfolio of investments . The fund will be invested over an 18 month period in around 12 companies and will be drawn down from the participating institutions as and when investments are identified. The investments will belong to the participating institutions, but selected and managed by the Enterprise Board . The institutions have the right to exercise a number of safeguards which are felt to be necessary at this early stage . The investments of risk finance will be made with a view to capital growth, without necessarily any income in the shortterm . Rate fund finance will be treated the same as pension fund finance and not as a subsidy to industrial or financial capital except insofar as it will take a larger share of any investment than any single pension fund . The West Midlands County Council has also drawn up a strategy for working towards restructuring proposals in the foundry industry which is one of the largest sectors in the area. In this the Enterprise Board can be actively involved because it has five investments in different parts of the foundry industry . In addition it is proposed that local authority pension funds should also consider investment proposals from each others' enterprise boards . This would create a network of cross-investments and allocations between local authorities which strengthen each individual initiative . It also helps in the general argument about pension fund investment in any local initiative because a network of enterprise boards and other local investment vehicles enables pension funds to diversify their local investments across different areas and sectors of the economy .

113

CAPITAL & CLASS 114

This and other issues, such as cooperation over shareholdings in companies that Robin Murray refers to, have been the subject of discussion and further work at special conferences for local authority pension funds . The first was at West Midlands in November 1982, the second at Merseyside in April 1983, and the third is to be held in London later in 1983 . The conferences have challenged the record of pension funds and the role of the City and they are pressing for positive action by local authorities on the issue of the investment of their pension funds . The danger of not taking on the funds head on, is that local authorities can get channelled into countless demonstration projects which are no challenge to the power structure at all . I imagine some observers will view this as sacrilegious, but I feel that a few co-operatives each employing a handful of people, mainly in the service and retailing sectors, are harmless . We are fooling ourselves if we imagine that they are the root of some new economic structure, or that they and some other projects are islands of socialism, or socialism in one company . They give some people limited control over a part of their lives, and there is nothing wrong about that . But altering an economic structure, perhaps with large co-ops employing hundreds of people which can hold their own in the long run is a major exercise which needs big money, often in the form of risk finance . Robin Murray gives the game away at the end of his article by summarizing his view that restructuring is the main issue . `Finance is only a part of this package . It cannot lead it . In our first year of operation' he writes, `we have found money to be the least of our problems : at times it has even been a negative factor' . The GLC must be the only local authority in

the country able to say this . In Greater London the product of a 2p rate under Section 137 of the 1972 Local Government Act (what local authorities currently are using to spend money on economic initiatives) is nearly £40 millions . In contrast, in the West Midlands it is just over £9 millions, with about £8 million available for economic development (not just investment in companies) . In other areas it is £3 millions or £4 millions . In a London Borough it can be less than £1 million . Let us contrast these figures with the local authority pension fund resources available . Ten per cent of the fund (what can be invested in unquoted securities) in the West Midlands is over £50 millions, in Greater Manchester £55 millions, in Derbyshire £12 million, in Islington £4 millions . These vast pension fund resources are available . In some areas it is not a matter of the pension fund being prised open for some property investment as part of a bigger rescue deal backed by Section 137 finance . Instead, pension fund money is virtually the only readily available source of local funds, if the local authorities are to have any effect . Hence the need to get ther arguments worked out for an alternative investment strategy which confronts the City on its own terms . We can have all the restructuring proposals we care to devise, for foundries in the Midlands, for the fishing industry in Lancashire and the North East, for clothing, textiles and steel in Yorkshire : without knowing that we have control of finance, perhaps we should not get started .

Richard Minns is Investment and Policy Advisor at the West Midlands Enterprise Board

PENSION FUNDS-ALTERNATIVE VIEW Notes 1 . Yao-Su Hu (1975) National Attitudes and the Financing of Industry, PEP Broadsheet no 559 . 2 . William Clark (1979) Inside the City, Allen and Unwin . 3 . Richard Minns (1980) Pension Funds and British Capitalism, Heinemann . 4 . Phillips and Drew, Equity Market Indicators, October 1982 . 5 . `The City: A Socialist Approach' : A Response to the Report of the Labour Party Financial Institutions Study Group .

Banking Information Service, 1982 . 6 . `The financing of Japanese industry', Bank of England Quarterly Bulletin, December 1981 . 7 . Jerry Coakley and Laurence Harris (1982) `Evaluating the role of the financial system', Socialist Economic Review, D . Currie and M . Sawyer (eds) Merlin . 8 . National Association of Pension Funds ; Response to Consultation Document drawn up by Lord Chancellor's Law Reform Committee ; reproduced in part in Pensions World, February 1983 .

115

CAPITAL & CLASS

MARX & ENGELS COLLECTED WORMS The Correspondence The publication of Volume 38 marked the beginning of a new stage in Lawrence & Wishart's project of publishing the complete works of both writers, and has been greeted enthusiastically by the press. . .the book is indispensable to anyone with a serious interest in Marx, marxism and the 19th century'- EJ . Hobsbawn in New Society `The translation . . .is masterly : not only faultless but immensely readable and displaying a fine ingenuity in making sense of the more abstruse - or merely tougher Teutonic - constructions, while retaining the highly individual diction of each writer'- Yvonne Kapp in

The Sunday Times.

The collected correspondence of Marx and Engels will consitute an invaluable source of biographical information and also provide essential material for the study of one of the most influential intellectual partnerships of modem times .

Published Summer 1983 Volume 39: Letters 1852-1855 The second of the thirteen volumes which will bring together the surviving correspondence of both Marx and Engels offers a series of insights into the lives of both men and their families during their long exile in Britain, it provides a unique record of the evolution of their political philosophy and casts valuable light on the conception and early publishing history of several major works, including The Eighteenth Brumaire and Engels's Revolution and Counter-

Revolution in Germany. Cloth £8.50

lim

LAWRENCE & WISHART 39 Museum Street, London WC1A 1LQ

A

Wolfgang Rudig

Capitalism and nuclear power: A, reassessment traditionally been welcomed by marxist authors as a pinnacle of technical progress and a foundation for the socialist land of plenty .' The only political influence considered was the possible inhibiting influence of capitalism on the pace of technological progress, due to either its misuse for military purposes or the basic anarchy of capitalist production . Martin Spence's recent paper `Nuclear Capital' (Capital and Class 16) distinguishes itself well from such rather antiquated views . In his argument for abandoning nuclear technology as part of a strategy of socialist transformation, Spence attempts to establish that capitalist influence on techological development is far more substantial than mere `inhibition' . Spence's article may play an important role in putting nuclear energy on the agenda of socialist politics, a process which, in comparison with other countries, is long overdue in Britain . In my view, `Nuclear Capital' falls, however, far short of a comprehensive analysis of the issue : several central hypotheses do not survive empirical test and many important questions have been dealt with inadequately or not at all . Nevertheless, the article does provide a good basis for further discussion and theoretical development . This is the framework of this paper : starting from a critique of `Nuclear Capital', I will try to proceed and suggest alternative asssessments of the nuclear issue . Martin Spence's divided his article into two major sections . NUCLEAR POWER HAS

Nuclear power is not a technology of the kind which, harmful under capitalism, can be made benign by socialism. It is a dead-end technology that should be rejected altogether . The state however is deeply implicated in its development, marxism is compromised by acceptance of superindustrialism and the trade union movement is largely pro-nuclear. The new green movements will be endangered by seeking incorporation into a traditional socialist programme .

117



CAPITAL & CLASS 118

In the first part, he argues that nuclear power is a technology primarily chosen and promoted by multinationals, designed to secure their increasing power . He further argues that nuclear power is a `specifically capitalist technology', which should be totally rejected . In the second part, Spence argues for an integration of a non-nuclear energy programme into an Alternative Economic Strategy, looks at the class base of the anti-nuclear protest, and proposes a coalition of old and new social movements . I will broadly follow this structure and present my theses in three sections : Firstly, I will challenge the view that multinationals are the prime protagonists of nuclear power . I will argue instead that the state should be the central focus of analysis and I will try to formulate some hypotheses on its role in nuclear developments . Secondly, the concept of a `specifically capitalist technology' will be examined . I will consider different possible interpretations and suggest an alternative approach . Thirdly, I will reassess the social base of anti-nuclear movements and evaluate the possibilities of a coalition of `old' and `new' social movements .

The development of nuclear technology

Martin Spence quite rightly points out that the development of nuclear power was a highly complex process and cannot be put down to one simple principle . , However, to reach some kind of satisfactory understanding of this development, one has to look at the history of nuclear energy in different countries in greater detail . I will compare the us, West Germany, France and Britain in this respect, and come to rather different conclusions about the political dynamics behind nuclear power . USA The industrial use of nuclear power received its first major impetus in the so-called `Manhattan Project', an all out effort by the us in co-operation with Canada and Britain to construct an atomic bomb . This project must be regarded as an historically unique concentration of scientific, industrial and financial resources for the construction of a technical device . By the time the project was transferred to the United States Atomic Energy Commission (USAEC) in 1946, it comprised 37 installations in 19 us states and Canada, had about 37,800 members of staff and represented a war-investment of 2,200 million dollars .' In the light of these figures, it seems fair to conclude that the preconditions for further industrial development of nuclear power would never have been created in such a short time without the coincidence of essential insights of atomic physics and the second World War .'

NUCLEAR POWER The industrial generation of nuclear electricity in its present form is thus unthinkable without this initial impetus . In the us, private companies participated in nuclear development from the very early stages . Despite the total control exercised by various state bodies and the absolute secrecy of atomic projects until 1954, private industry was given a major role through a special contract system . Certain research and development projects were carried out by these firms with the cost and a fixed profit covered by state funds . Also the administration of installations, laboratories and so forth was carried out by private firms under this system, which became the dominant feature of US nuclear R & D policy 4 . Until 1954, us nuclear policy was almost totally determined by military considerations . For the firms involved, this had on the one hand the disadvantage of not being able to make use of their experience in the market, but, on the other hand, they were guaranteed sole access to nuclear development and hence had no fear of competition from other companies . From the beginning, Westinghouse and General Electric (GE) were the main contractors, and both companies became the main suppliers of nuclear installations in the following years 5 . By 1954, it had become clear that the aim of the policy of total secrecy - avoiding the international spread of nuclear weapons, particularly to the Soviet Union - had not been reached . Westinghouse and GE were worried about losing out to European suppliers on the world market . The switch of policy in 1954 reflected this changed situation . Firstly, it was geared to creating favourable conditions for the profitable exploitation of nuclear technology at home and to securing the dominance of US technology on the world market . The us Atoms for Peace programme offered the supply of nuclear power stations, assurances on the supply of fuel and financial help . By 1955, more than two dozen countries had entered co-operation contracts with the us'. Secondly, `Atoms for Peace' was an attempt to limit nuclear weapons proliferation by other means : the free offer of nuclear technology was supposed to discourage countries from embarking on their own nuclear projects and thus acquiring nuclear weapons capability at the same time . Under the terms of the US programme, the whole nuclear fuel cycle remained in American hands' . The ensuing development in the us' at first seems to confirm the thesis that private companies took the main initiative . Westinghouse and GE were eager to capitalise on their experience . They were not interested in experimenting with further reactor technologies, but rather in conquering the market as soon as possible with the reactor designs originally developed for military purposes . The chief example is here, the Pressurized Water Reactor (PWR) which was originally chosen as the power source

119

CAPITAL & CLASS

for submarines . Westinghouse was closely involved in the development of the PWR and won most contracts for submarine reactors in the 1950s . Building on this experience, they concentrated totally on marketing the PWR . GE had developed several designs which were less successful and finally chose to concentrate on the Boiling Water Reactor (BWR) design . In the middle of the 1950s euphoria spread among the nuclear-industrial complex . The us home market was, however, not very promising . Electricity utilities in the us were small and could hardly afford to invest massively in a new technology with an uncertain future, particularly at a time when conventional power stations were clearly more economic . The us reactor industry thus first concentrated on the European market . Three reactors were sold with the help of both us and European public funds . But the advent of cheap oil at the beginning of the 1960s dashed early hopes of a great commercial breakthrough on a world scale . A turning point was reached in 1963 when a us utility bought a nuclear power station without direct state subventions . This led to a wave of reactor orders by us utilities, inundating the main suppliers Westinghouse and GE with contracts they could hardly carry out . Up to the end of 1967, 75 nuclear power stations with a capacity of more than 45,000 MW had been ordered' . What was responsible for this boom at a time of plentiful and cheap oil supplies? A major factor was that reactor suppliers sold at prices far under production cost in the expectation of handsome profits once the company had established itself in the market . A RANDCorporation study assesses the financial losses of GE and Westinghouse for the first 13 reactors built under the turnkeysystem at between 875 and 1,000 million dollars, i .e . 73 to 78 million dollars apiece" . Despite these artificially low prices, nuclear power was still hardly competitive with conventional energy sources . The central economic justification was the cost calculations of the reactor suppliers, which predicted enormous `economies of scale', but these were not founded in any concrete experience with nuclear plants" . Why did the private electricity utilities nevertheless go nuclear without any substantial state subsidies forthcoming? The following factors might be most relevant . First, utility decision makers were characterised by an ideology of technological progress . Nuclear power, seen as the latest technical advance, thus had to be welcomed. Even if the cost calculations of the reactor suppliers were not totally accepted, there was the widespread belief that nuclear power was the power source of the future, and that the utilities' prestige and economic standing would be enhanced if this step was taken earlier rather than later . 12 Second, the 1963 `economic breakthrough' created a

NUCLEAR POWER `bandwagon effect' : without any major change in the political and economic conditions, utilities started ordering reactors to avoid `being left behind' ." The third factor was the fear that the utility industry might be nationalised if it were to reject nuclear power. Once it was seemingly established that nuclear power was the energy source of the not too distant future, utilities went nuclear to avoid the creation of `massive atomic TVAS' . 14 (The Tennessee Valley Authority, the only big US utility in public ownership, was created in 1933 to manage the gigantic hydroelectric projects .) By the beginning of the 1970s, it became clear however, that the cost calculations put forward by the reactor industry were hopelessly wrong . Capital costs soared, due to longer construction times, design complexity, higher safety measures and attempts to increase plant performance ." The nuclear industry was `saved', however, by the oil price increases in the early 1970s . Without this it is possible that the rather costly experience with nuclear power in the 1960s might have led to the halt of construction, at least temporarily . 'S Such a halt was not far away anyway : the main effect of the 1973/74 oil price crisis was to depress consumption, making predictions of future demand much more insecure than in the 1950s and 1960s . At the same time interest rates increased, discouraging investment in capital intensive projects . Anti-nuclear protest delayed nuclear construction through litigation . The private utilities, deciding on purely economic grounds, could thus no longer take the risk of ordering nuclear stations" . With no further demand increases forthcoming, it proved more economic actively to invest in energy conservation than in expanding supply installations ." One other major reason for this decline of nuclear power in the us can be found in the behaviour of the federal administration . Despite the critical state of the US nuclear industry, there was no government programme which comprehensively secured its future ." On the contrary, government policy systematically undermined the nuclear industry's economic standing . President Carter's non-proliferation policy robbed Westinghouse and GE of any chances to play the dominant role in the world reactor market (to the benefit of the Canadian, German and French industries) . The accident at Three Mile Island made the Us home market even more insecure . 19 Even the present administration does not seem to be prepared to intervene in the electricity industry to secure an ordering programme for nuclear reactors . The American nuclear industry might press for such intervention, but it has obviously been thoroughly unsuccessful, leaving the whole nuclear option in limbo .

121

CAPITAL & CLASS

West Germany The pattern of development in the major European countries has been different, in varying degrees, from the us experience . Most similar to the us has been the development in West Germany . 20 Here, nuclear activities had been forbidden by the allied powers until 1955, although some clandestine research activities had been going on . The main initiative came from private industry which, in the nuclear euphoria of the 1950s, wanted to get involved in what was supposed to be a major future industry . The German government, following its ideology of free market economics, left it largely to a working group of industrial interests to work out a first nuclear programme in 1957 . The supply industry had failed, however to consult the electricity utilities . German utilities act as private companies, although most of their shares are held by various local and regional public bodies . From an economic point of view, they were not interested at all in nuclear power at first . While the big industrial companies from many sectors (electrical engineering, steel, chemicals and other manufacturing) aimed to build up an independent German nuclear industry with its own reactor line to conquer world markets, the utilities' interest was confined to the future price of electricity . The German government was not in a position to provide the funds necessary for the development of an independent German reactor line, being prohibited from making military use of nuclear power . There was also no intervention in the decision-making process of the utilities which decided in favour of the us-built Light Water reactors . German industry thus had to abandon all other reactor lines and two main companies remained, building the PWR and the BWR under licences from Westinghouse and GE . By 1969, both companies merged to form the Kraftwerk Union (KWU) which is now a 100% subsidiary of Siemens . Reactor construction reached a peak in the early 1970s, before dropping off from about 1975 onwards . As in the us, one reason for this was the influence of the anti-nuclear protest movement, which succeeded in delaying construction through court action, site occupations and other protest activities . On the other hand, unlike the us situation, the utilities remained totally committed to the nuclear option . One reason for this might be that conventional energy sources, such as German coal, are more expensive than in the us . The economic standing of nuclear stations thus remains more favourable . The utilities' pricing policy also seems freer and this greatly improves their manoeuvrability in investment planning. The German federal government and most state (Lander)

NUCLEAR POWER governments retain a strong commitment to the nuclear option . In marked difference to the us, the government has gone to extremes to create conditions favourable to a continued nuclear option in Germany . At home, strenuous efforts have been made to contain the impact of anti-nuclear opposition . The fragmented structure of the German political system has made this very difficult, but no single nuclear power plant has yet been stopped finally . From the point of view of the utilities the big delays in nuclear construction have not been detrimental to their economic standing . On the contrary, electricity demand has risen far slower than their capacity, and there is thus no urgent need to add even more nuclear capacity . The main pressure has been on the Kwu which in the early 1970s gravely miscalculated the demand for nuclear stations and built up what turned out to be a massive overcapacity in production facilities . The German government has, however, always closely identified itself with the interests of the KWU . Export contracts to Brazil and Argentina have been won after the close involvement of senior government officials who also covered the financial risk of the transaction . Attempts to stop the implementation of these export contracts by the Carter administration were rejected . All in all, nuclear power has received comprehensive backing by the state in Germany and this must be seen as one major reason for its survival . France 21 France from the start followed a different development strategy . Private industry was never allowed to play any dominant role in French nuclear politics . Until 1969, the French Atomic Energy Commission (CEA) largely determined the course of development . The first years after World War II saw the French trying to build up a scientific and technical infrastructure under the directorship of Frederic Joliot-Curie, a member of the French Communist Party . Joliot-Curie was dismissed in 1950 and an ensuing re-organisation of the CEA brought the nuclear sector under control of the central administration in close co-operation with the military . These circles promoted the idea of a French atomic bomb project and succeeded in guiding the CEA's research and development strategy into a direction best suited to these ends . Successive governments of the Fourth Republic gave no positive backing to the project and, at one point, it was explicitly rejected . However, the CEA continued its work, with the help of interested military circles and a few Gaullist politicians, until the atomic bomb project was officially sanctioned in 1958. 22 Programmes for the `peaceful' use of nuclear energy were first of marginal importance and the first reactor construction pro-

123

CAPITAL & CLASS grammes in the late 1950s were rather small compared with the UK . The CEA promoted a gas-graphite reactor which had been developed from the plutonium production technology of the bomb project . The only French electricity utility, Electricite de France (EDF), preferred the us light water reactor, however. After long organisational conflicts the EDF won in 1969 and the CEA's influence was curtailed by a comprehensive re-organisation of the industry . The main protagonist behind the French nuclear programme is certainly the EDF together with relevant sections of the central administration, although the nuclear construction industry also pressed for the LWR to boost its export chances . Nuclear power fitted the EDF development strategy which was first based on a policy of `tout petrole' (all oil) . In an attempt to reduce energy cost by any means, France had opened itself totally to cheap oil imports and neglected indigenous, uneconomic resources such as coal . Already in the late 1960s, EDF had identified nuclear power as a supplement to and later a substitute for oil, to ensure continuing sources of plentiful and cheap energy . In a long term development programme backed by the Paris administration, both politically and with generous financial support, the EDF set out a massive electrification programme based on nuclear power . From the state's point of view, such a policy first increases the strategic energy independence of France (with large uranium resources under French control in Niger) and at the same time, provides the basis for a burgeoning nuclear industry with excellent chances on the world market . EDF gave all contracts to the company Framatome which emerged as monopoly nuclear supplier, forming a stable alliance between the Paris administration, the state utility EDF, and the private monopoly nuclear company Framatome . This nuclear complex remained relatively immune from the political and economic pressures against nuclear power, the French administrative system not allowing protestors any significant influence . The build up of a centralised, supply-oriented electricity industry, with a monopoly structure and access to financial resources at preferential rates through the state, is not as dependent as, for example, the small private US utilities, on short-term market fluctuations . Under the new Socialist government, the EDF's nuclear programme is seen as an integral part of a gigantic new industrialisation programme initiated by the state, although the economic recession and decreasing energy demands are now forcing the utilities to curtail their ambitious programme for financial reasons . Whether Framatome remains `private' as part of the Creusot-Loire complex or is nationalised is irrelevant in determining the degree of nuclear activity in France .

NUCLEAR POWER

Britain In Britain23 , nuclear policy-making was at first quite similar to the French pattern . Nuclear technology was developed in the framework of a nuclear weapons programme . A state agency, the United Kingdom Atomic Energy Authority (UKAEA), was in charge of nuclear power from 1954 onwards, private industry playing a minor role . The reactor line adopted was, as in the French case, a gas-graphite (magnox) type . But Britain did not make the transformation seen in France in the late 1960s . Firstly, while the French did not succeed in developing their gas-graphite technology further, the British designed the Advanced Gas-cooled Reactor (AGR) to replace the outdated Magnox design . The UKAEA which, like the CEA in France, pushed its own technology thereby had a better case to argue against the LWR . Secondly, the French utility commanded a greater independence than the British Central Electricity Generating Board (CEGB) . The EDF succeeded in keeping the first reactor programme in the 1950s relatively small . They even managed to order a US LWR in a French/Belgian joint enterprise, thus gaining experience with that type from the early 1960s onwards . In Britain, the CEGB was much more under the sway of the UKAEA which commanded unequivocal government support . The CEGB was not even consulted on the first nuclear construction programme . When, in 1964, the decision was made for the AGR, the CEGB seems to have been subject to heavy pressure from UKAEA and government . It did not command the technical expertise with alternative reactor lines to counteract the UKAEA's claims effectively . At the time of the third major decision, in 1974, the CEGB had voiced its strong interest in a major nuclear programme according to the French pattern . But again its case was dismissed. Electricity demand had fallen far behind that expected in the 1960s . The demand the AGR programme was to meet never materialized, and thus the tremendous delay in AGR construction did not have any adverse impact on the availability of electricity . Furthermore, major oil and gas reserves had been detected in the North Sea. At the time of the oil crisis Britain was thus relatively well off in terms of energy security, and did not need any major nuclear programme . 2' There was, however, a broad political consensus to keep the nuclear option open . The later decisions to go ahead with the construction of two further AGRS in Torness and Heysham and to build a first PWR at Sizewell must be seen in this context . Both cases would hardly be defensible on purely economic grounds, but seem intended to preserve the industrial capabilities of British industry to build nuclear power stations, thus enhancing long-term energy security . What was the impact of industry on this process? There

125

NUCLEAR POWER are several important differences in the structure of the industry and the nuclear market which must be noted . Firstly, Britain did not use the `contract system', employed in the us in the early stages of nuclear development, presumably because Britain simply did not have large enough companies to perform such a task 21 . Throughout the 1950s and 1960s, British industry was highly fragmented and feeble . In the us the large market for nuclear reactors allowed four major companies to establish themselves in the market (Westinghouse, GE, Combustion Engineering, and Babcock & Wilcox) . The British market was far smaller and export contracts were not forthcoming in sufficient numbers . The decision to spread the AGR orders among the three consortia existing at that time was therefore more than unwise, particularly as none of them had been involved in AGR development and had no experience whatsoever with the technology at prototype or demonstration levels 26 . Britain thus experienced a continuing uncertainty over the choice of reactor line which put private industry in a difficult position . In the US and Germany, it had been left totally up to the utilities to make that choice, although the LWR success has to a large extent been predetermined by Westinghouse and GE's interest . With France finally deciding to adopt LWR technology in 1969, none of the three countries experienced any insecurity over reactor choice in the 1970s . The predominating role the UKAEA was allowed to play is the prime reason for this insecurity which still prevails in Britain . In the us and Germany there had never been any organisation of the power of the AEA, and in France, the CEA had been deposed from its previous position . In all these countries a relatively stable and workable alliance between vendors and consumers had been established, either as a result of market forces or from determined and consistent state planning . Had Britain been in a more difficult energy situation the government might have been forced to a more definite interventionist policy, along the French pattern . Instead, there was never any re-organisation which could have removed the UKAEA from its position, given the CEGB a comprehensive long-term development programme and selected one nuclear supplier able to deliver the goods . The rationale of nuclear energy

What is thus the current situation of the nuclear industry world wide? Firstly, there is increasing evidence that nuclear power is still `uneconomic' from the point of view of both vendors and consumers . Some sectors of the nuclear business seem to be making profits, for example in uranium mining and fuel fabri-

127

CAPITAL & CLASS 128

cation . But, even here, I would argue that such profits are the result of direct or indirect government intervention . The price of uranium, for example, is not only indirectly dependent on state action through the demand created by nuclear programmes, but has in the past also been directly manipulated . An international uranium cartel was set up in 1975 with the participation of several governments leading to major increases in uranium prices . It reflected a common interest in increasing price incentives which would foster investment and thus secure future uranium supplies" . The nuclear industry has made tremendous losses . The electricity supply industry, where it is organised as private capital, is not prepared to order any further nuclear stations at present . Existing overcapacities, stagnating electricity demand and the unavailability of any reasonably secure forecasts of future development, make the extension of supply installations in general a high risk option . 28 From the point of view of the multinationals, I would argue, the nuclear sector on the whole does not seem to be a very attractive investment . Companies such as Westinghouse and KWU might be prepared to foot the bill for their idle capacities in the hope that the situation will change and that in the end they will be able to get a return on previous investment . Others, such as General Electric, might prefer to leave the market . There are certainly no new companies with new capital forthcoming in reactor construction, enrichment or reprocessing. The situation of the American industry looks particularly bad as their potential export markets are lost to the French, German, and Canadian industries . Framatome and KwU started building MRS under licence from Westinghouse, but both companies developed their own design and the licensing agreements have run out . Westinghouse is therefore not dominating the world market, as Spence suggests" . The French have perhaps the best chance of coming out on top because they have a relatively secure order book for the home market, allowing them to mass-produce one standard design . Furthermore, they are offering complete fuel cycle facilities from enrichment to reprocessing, provided they are able to sort out the remaining technical problems . The French industry is only able to do this because nuclear power is pursued in France as a long-term programme with comprehensive state backing . No industry will survive for very long without a secure home market, the world market being in any case very depressed with Third World countries' debts mounting and their economies declining . All in all therefore, there is very little sign of multinationals pushing forward with nuclear energy to stabilise their power . Instead, the state continues to play a major role . Nuclear energy appears to be viable only in countries where the nuclear-industrial

NUCLEAR POWER complex is sufficiently entrenched in the state apparatus . All major actors of nuclear policy-making have to be involved in an integrated policy-making structure : government agencies, electricity utilities and reactor and fuel cycle industries . Of particular importance are the utilities . To finance a major project in the current situation they have to be either very healthy financially (W . Germany), or have preferential access to financial resources via the state (France) . Without active state support, the nuclear industry's situation would be very difficult . What is the rationale behind the state's action in the nuclear field? I earlier identified 'energy security' as the main reason . State actions in all four countries can be understood in these terms . But it is also useful to discuss nuclear power on the more abstract level of theories of the capitalist state . This allows us to understand the broader significance of state nuclear energy policies . The capitalist state has the general task of creating the formal and material preconditions which guarantee continued production and accumulation . On the one hand, the state is dependent on successful accumulation through the tax system : on the other hand it has to win legitimacy for its actions . 30 The creation of favourable conditions for capital accumulation can take various forms . The state can, for example, try to promote R & D with the aim of developing new products . The case of nuclear power can be partly interpreted in this way and indeed most historical studies of nuclear power have tried to identify the best conditions for the development of a successful nuclear technology . The most sophisticated analysis comes to the conclusion that the state should take a major role in the development phase, should then leave the major initiative in the demonstration phase to vendors (reactor industry) and consumers (utilities), and finally leave it to both vendors and consumers to determine the final result in the dissemination phase . 31 Analysed within this framework, the state's promotion of nuclear technology would appear to be a failure, considering its still insecure economic standing after about forty years of development . The technology's inherent problems of high complexity, continued unpredictability and tremendous capital cost would have rendered nuclear power obsolete as a commodity sold on a free market . However, one might argue that the state also has to provide the general infrastructure for successful capital accumulation . Nuclear energy must be seen in this context . Particularly after the oil price crisis of 1973/74, the central motivation of governments in holding on to nuclear power policies appears to have been their aim of long-term energy security . Different states and governments might have different C . & C . 20-I

129

CAPITAL & CLASS 130

views over how to promote energy security. One basic feature, seemingly followed by all nuclear countries, is a strategy to keep the national nuclear industry afloat, either by home orders for nuclear reactors despite any immediate economic need for such installations, or generous subsidisation of the export of installations . Assessments of the role of nuclear energy in energy security policy differ widely, once one surpasses this level of maintaining the nuclear-industrial complex as such . The us does not seem to see any necessity to intervene more strongly to secure new reactor orders . In Britain there is the almost unique situation of a conservative government promoting nuclear energy in a bid to curb the importance of the coal sector and thus reduce the threat that might be posed by striking miners. To what extent, however, is the capitalist state able to fulfil its functions? One set of theories tries to show how the imperatives of private accumulation lead an `active' technology policy to fail systematically . Thus they try to argue that technology policy does not contribute to the creation of stable economic growth in capitalist economies . 32 This approach makes a number of assumptions which might be questioned. First, the rationality of the process of state intervention in technology policy as such is assumed. But how, one may ask, does the state `know' what to research, which technology to promote, what to do to keep the `system' functioning? Hirsch and others simply assumed that nuclear energy as such was a rational object of state intervention and that the problem was how to develop and disseminate it in the fastest and most efficient way . A critique of this approach to technological development leads to two theses on nuclear power which might be worth further investigation . The first thesis is that in the absence of market conditions and a virtual monopoly of expertise by the professionals of the nuclear-industrial complex, the state is in no position to evaluate its nuclear policy independently . This means that one might conceptualise the rationale of nuclear politics in terms of the organisational selfinterest of the nuclear industrial sector rather than in the energy security requirements of the capitalist system per se . The second thesis is that the reasons why nuclear energy became an issue of public protest cannot be found in the failure of the state to develop nuclear energy technology quickly and efficiently enough, but rather in the safety questions raised by the technology . This is a new concern which has to be integrated into the theory of the state . Aspects of Claus Offe's theory can perhaps provide an analysis of these issues . Offe distinguishes between crises as a result of developments in the economic system and crises resulting from state intervention to solve economic crises . Crises of the

NUCLEAR POWER 131

latter kind would manifest themselves in new problems . For example, urban renewal would lead to social disintegration and more expensive rents ; the expansion of the educational system would lead to a deterioration of the conditions of learning and teaching ; the construction of new streets, industries, power stations would lead to increased environmental deterioration . These new problems resulting from state intervention would also create new political conflicts : `The contradictory experience that increasingly sectors of concrete living conditions are determined by politicaladministrative institutions, but are nevertheless politically not controllable, creates a structural legitimation problem .' 33 Offe thus expected that the capitalist state would increasingly be confronted with protest activity generated by its own actions . This 'legitimation crisis' would, in Offe's view, only be solved by new interventions which would go beyond the previous limits and intervene in the nature of capitalist production itself . Offe's prediction did not come true . In many areas where such legitimation crises were expected, they did not materialise . Nevertheless, the rise of the environmental and anti-nuclear movements can be interpreted as a result of a legitimation crisis . This interpretation of the nuclear power conflict as a `crisis of state intervention' has important implications for the analysis of anti-nuclear resistance and its political status . But first it is necessary to have a closer look at nuclear power as a `specifically capitalist technology' . Offe dealt very superficially with the nature of environmental problems themselves . How is it that state intervention has led to a deterioration of the environment? What exactly makes nuclear technology a safety hazard? And what exactly is a `specifically capitalist technology', if there is such a thing at all?

Martin Spence at the beginning of his article takes the `case against nuclear power' as read . But he hardly makes any substantial reference at all to the arguments for and against nuclear energy . Spence bases his rejection of nuclear power exclusively on an analysis of the conditions of production in nuclear installations . Nuclear technology as a capital intensive technology provides few jobs, which, besides, are highly alienated . Nuclear workers are required to undertake highly dangerous work . They are so highly regimented that democratisation of the industry is out of the question . There is low level, personal resistance against this control, which in turn endangers not only the workers themselves, but also the entire population . Finally, the im-

Nuclear power as `specifically capitalist technology'

CAPITAL & CLASS 132

possibility of comprehensive strike action is claimed because of the safety risks involved would interfere with the workers' right to strike, organise, and defend themselves" . These arguments are relatively familiar and well documented elsewhere . Roy Lewis' study of nuclear power and trade union rights in Britain demonstrates that there should be some concern from the trade union side 35 . Dave Elliott's study of energy and employment36 , though heavily criticised 37 , raises this previously neglected issue well and should provide a basis for further studies on the employment impact of different energy technologies . But have these questions been the centre of concern over nuclear energy? In my view the central question, without which there would be no public controversy and mass protest about nuclear power, concerns the safety of installations, from nuclear power stations to reprocessing plants, waste disposal and a possible plutonium economy . Other questions, such as nuclear power's political implications, derive from this concern . While it is reasonable to argue that the safety of nuclear workers should be part of the issue and that anti-nuclear groups should address this problem, we should also note the fact that nuclear workers themselves seem rather oblivious to such arguments . Concern over the safety of nuclear workers has certainly not made nuclear power the major political issue it is now . In my view the major question to be asked is how does the alleged character of nuclear power as `capitalist technology' relate to the safety of nuclear power? Spence addresses this question in a way I found unsatisfactory . To formulate my criticism more clearly, I would like to distinguish between three different approaches to dealing with the safety of nuclear power .

'Use-abuse' approach The traditional view taken by 'marxist' authors is that technology can be used in different ways, and that its use depends on the `relations of production' . According to this approach, nuclear power is only unsafe where its use is guided by the profit motive . Private utility companies, so the argument goes, want to make as much profit as possible and thus do not invest sufficiently in safety devices . However, if the electricity industry is submitted to public control, and sufficient money is made available to make the plant safe, then there is nothing to worry about ." This argument can be extended to whole reactor lines . One might well argue that the us light water reactor is an inherently unsafe construction because Westinghouse and GE, driven by the profit motive, wanted to capitalise on their experience as soon as possible . They did not therefore develop the

NUCLEAR POWER

LWR any further or look at other, possibly safer, designs . Thus, the import of LWR technology should be opposed . This 'use-abuse' approach to nuclear technology is primarily taken by orthodox communist parties . The German Communist Party, for example, is against nuclear power only as long as it is run by the German private utilities and the nuclear industry is not nationalised ." The French communists opposed the adoption of the LWR in 1%9 but are now very pro-nuclear . The Communist Party of Great Britain is also opposed to the LWR, but not to the British AGR . The Communist Party of Luxembourg rejected the import of a German-built LWR and .40

suggested an import from the USSR The 'use-abuse approach' might regard certain technical devices as `specifically capitalist' but does seem to imply that all technological systems somehow can be controlled and put to use . It thus shares the traditional philosophy of unqualified technological optimism .

The `labour process' approach This approach emphasises the function of political control which can be exercised through technology . The analysis of capitalist labour processes, inspired by Braverman, 4' alleges that the increasing centralisation of production and increased division of labour does not lead only to economic advantage . Such technical developments also tend to isolate the individual worker, to decrease her or his independence in the production process, to enhance her or his alienation from work and, at the same time, to decrease the chances of political disruption . 42 This approach has been applied to the case of nuclear power in various ways . Early sociological works, for example, expected that automation would be greatly enhanced by the ubiquitous availability of electricity cheaply produced by nuclear stations . 43 More compelling is perhaps the view taken by the BSSRS Politics of Energy Group and Levidov 44 . They reject the , use-abuse' approach because it understands the risks of a technology only as technical imperfections which could be ironed out by technical solutions . Such action would, however, only lead to an ever higher control of the labour process without decreasing the risk involved . They argue instead that the risk of nuclear power can be explained in terms of the political deficiencies of the organisation of the labour process : ` . . . risk is inherent in the continual struggle between workers and managers for control over the labour process . . . however exceptional the risks of nuclear power, the risks exist for rather unexceptional reasons, namely the historical

133

CAPITAL & CLASS 134

tendency of all capitalist technology to subordinate living labour.'45 According to Levidov, it is exactly the attempt to reduce workers' possibilities to make `mistakes' which leads to a greater division of labour and atomisation of workers, which in turn aggravates worker helplessness and contributes significantly to `mishaps' occurring . 46 Spence takes a similar view, representing task fragmentation and subsequent workers' negligence as a form of protest as the main reasons for nuclear power's hazards . "I The important question to be asked here is whether such politically deficient organisation of the labour process can be changed . If the labour process in a nuclear installation could be submitted to workers' control, then, according to these views, nuclear power might be made safe . Such a position would, however, only be a new form of the 'use-abuse' approach . Both views allege that it is only a question of putting right the political conditions under which technologies are used to make them safe . An alternative view might regard the organisation of the labour process as built into the technology itself . There might be technologies which one might not be able to submit to political control . Such technologies thus might be seen as `specifically capitalist' in the sense that they could not be used in a socialist society . This is obviously the view taken by Spence. The central problem with the `labour process approach', is, in my view, the alleged causal relationship between the organisation of the labour process and the general hazards of the technology . While Spence names some cases where such a relation might exist, there is also the more general implication that if no worker, for whatever reason, made a mistake nuclear power would be safe . There does not appear to exist convincing evidence from previous nuclear accidents, near-accidents and the everyday running of installations that the essence of the safety problem derives from workers' behaviour determined by the organisation of the labour process . In what way, for example, do the hazards of nuclear waste disposal depend on labour process variables? More evidence would also be needed to support the view that further `technological progress' could not eliminate many hazards without leading to further alienation of work . In summary, the labour process approach has the basic flaw that it tries to locate the issue of nuclear energy exclusively in the production sector and attempts to explain it with traditional concepts of labour/capital conflict .

The `Ullrich' approach In two seminal works of 1977 and 1979, Otto Ullrich has provided an innovative analysis of technology and political

NUCLEAR POWER power ." Ullrich is particularly critical of the traditional marxist , use-abuse' approach . Nuclear energy is, in his view, a technology which cannot be stripped of its disadvantages by using it in another form . Such 'cul-de-sac' technologies should be abolished in a socialist society . What are the exact reasons for the development of such `cul-de-sac' technologies and how are they identified? The central concept of Ullrich's analysis is 'Grofle Industrie' (Big Industry), as described by Marx in the thirteenth chapter of Capital . Big Industry is characterised by its size, a high degree of division of labour and specialisation, hierarchical structure, centralisation and other elements . Human progress has, in Ullrich's view, been equated with the progress of Big Industry which has led to the present industrial system . This development has, however, reached a new stage : the impact of the industrial system cannot be totally taken account of any more . Big Industry has unintentional, incalculable impacts on both the biological and the social system . Ullrich proposes a re-assessment of `Big Industry' as such . Marxist analyses have recognised the influence of the relations of production on the use and speed of technological change . However, the development of Big Industry as a given technological path has never been questioned . The `productive forces' have thus been seen as independent from the `relations of production' per se . Ullrich challenges this view . The relations of production have had a far stronger and more thorough influence on the productive forces than such a position allows for, to the extent that some technologies are shaped in their very nature by the relations of production . Ullrich goes even further in arguing that capitalist relations of production have determined not only individual technologies but the whole technological development which enabled the build-up of Big Industry as such . This intrinsic reflection of the productive forces by capitalist relations of production did not have to be imposed on the productive forces . Ullrich states that a 'tendential structural affinity' exists between capital and science and technology . Science and technology follow the same principles as Big Industry : both require the delegation of labour to atomised subjects ; both scientific and industrial production consists of many, particularised steps ; both scientific and technological professionals and individual capitals follow narrow aims with a unifying rationality eventually emerging only through an `invisible hand', if at all . While Ullrich seems tempted to reject Big Industry and industrialisation as such, he does formulate criteria to assess technologies individually . His main criterion is the 'calculability'

135E

CAPITAL & CLASS 36

of their impact . If its effects are incalculable this provides, in his view, enough reason for a socialist society to reject a technology . His alternative is the creation of a new technological system of small-scale, calculable technologies . Ullrich's work has been criticised by various authors . For Kapferer there is a contradiction between the thesis of a `structural affinity' between capital and science and the proposal of an alternative technology : the total rejection of the industrialisation process would be the only possible solution ."' Ullrich does not want to go as far as postulating categorically an irresolvable contradiction between industrialism and socialism, but he does not exclude that possibility either . To return to nuclear energy, it is thus seen as one example of a recent development of industrialism leading to an increased incalculability of its impacts . Nuclear energy might here be the symbol, or the actual first threshold, of a transition to a new phase of industrialism . This concept enables us to root the issue of nuclear energy firmly in the wider environmental and social impact of technological development, outside the narrow framework of labour/ capital conflicts in the production sector . To define the term `cul-de-sac technology' more comprehensively, one might introduce the terms `productive' and `destructive' forces'" . A given technological development could have certain destructive effects, which might be part of its intrinsic structure and not of a certain form of using it . A cul-de-sac technology would be one whose intrinsic destructive effects of either manifest/calculable or latent/non-calculable kind surpass its productive effects . Nuclear energy is a technology of potentially high and uncalculable destructive effects and could thus be classiffied as cul-de-sac technology . $' What, however, is the real importance of nuclear power for `capitalism'? The fact that nuclear power is an `intrinsically' capitalist technology does not necessarily imply that, in turn, nuclear power is a necessary prerequisite for the survival of capitalism . Indeed, it is even possible to argue that nuclear power, while in one sense unthinkable outside a capitalist form of development, has always remained an alien element . It would not survive under strict market conditions, since it requires a steady flow of subsidies, and it has created severe legitimation problems . Lovins and others have argued all along that nuclear power results from a failure to submit the energy sector to the free market . Lovins seems to desire a return to an ideal capitalist market economy with many individual capitals" . Others have correspondingly argued that only state intervention has created the severe environmental problems of today which would dis-

NUCLEAR POWER appear or be reduced with a return to a market economy ." Severe doubt, however, has to be voiced about whether the social system Lovins and others are proposing would be free of the problems of previous market economies . Inded, Lovins' view seems entirely ahistorical and neglects the basic social forces which had led to state intervention and Big Industry in the first place . Even if one accepts that state interventionism is a necessary stage of capitalist development, there is no reason to believe that all forms of state intervention are rational or indeed necessary . As has been shown, nuclear power has been promoted by a nuclearindustrial complex which, from the start, had close clientele links to the state . In countries such as Britain, France and Germany, this nuclear-industrial complex was able to remain in a commanding position and systematically to exclude possible alternative policies which could threaten its further expansion . The state and the `business community' largely accepted the nuclear complex's view of nuclear power as the only source of security, although both had no real way of evaluating the rationality of nuclear development . Once the nuclear sector's position has been entrenched in this way, it commands a significant amount of power . In the US, this entrenchment process has never taken place . Nuclear power remained a predominantly private business between private supply companies and private utilities . However, there must be severe doubt about whether this situation will continue if the us energy situation becomes markedly more difficult, or if the entire us nuclear industry were about to collapse . There is nevertheless no reason to believe that capitalism would break down should nuclear power become unavailable . That would be to severely underestimate the dynamics and resources of the system . 54 There is no reason why other centralised technologies could not be developed to fill its place which, at the same time, have a far more calculable impact, i .e . are not cul-desac technologies . The large scale use of solar energy, for example, is also accepted by the otherwise pro-nuclear HASA world energy study as a possible future source of unlimited energy supplies ." In this sense, nuclear power does not appear to be a necessary precondition for the continued existence of `capitalism' . Nuclear power might be replaceable by another, more beneficial energy technology, but the point is that there are a great number of other technologies, in other areas, whose social and environmental impacts are absolutely incalculable . Thus, not only nuclear technology, but the system that produces such technologies, is at issue here . In the end one has also, in my view, to face the fact that the further expansion of industrialism in its

137

CAPITAL & CLASS 138

present form as Big Industry has totally incalculable impacts : acid rain, the destruction of tropical rain forests, the Coz problem, the uncontrolled release of masses of chemicals into the environment and so forth . Many of these dangers have not received much public attention or led to widespread protest . Nuclear power has served as symbol for all these concerns, as properly analysed by Wolf Hafele, a chief proponent of nuclear development: `If properly interpreted and understood, the public concern about nuclear power is not unfounded, but that concern is not a simple function of a peculiarity of nuclear power . It is, rather, the general condition where the magnitude of human enterprises becomes comparable with the magnitude of the widest detrerminants of our normal existence . Nuclear power turns out to be a forerunner, a pathfinder, of that .'" The combination of Ullrich's and Offe's approaches, together with some ideas of Martin Janicke, lead in my view to a more comprehensive assessment of capitalism and nuclear power . The dynamics of the `system' might thus be described briefly as follows . The capitalist economy develops in a fundamentally contradictory way through cycles and crises . Technologies develop determined by the basic rationality of accumulation, in line with the principles of Big Industry . The increase in state functions in response to economic crises puts the state under higher legitimation pressure, making governments' fortunes dependent on their economic achievements . The capitalist state, in its own interest, becomes the most energetic promoter of `growth' . The state starts supporting and undertaking R&D . The development of Big Industry is associated with further specialisation and professionalisation of society, leading to a number of professional sectors . These sectors gain a significant amount of independence as the evaluation of their actual and potential development is largely controlled by themselves . The state increasingly depends on these sectors to fulfil its functions . 'Solutions' to problems caused by capital accumulation and state intervention are developed in ways which do not challenge the basic features of the system which serve the self-interest of the professional sector and even increase economic growth . The health sector can be seen as one outstanding example, others are crime, environment and energy . The `solutions' offered do not deal with the problem directly but rather try to compensate for it, or repair the damage . Thus policies such as the prevention of disease and crime or energy conservation are neglected . With further advancing industrialisation, the problemsolving capacities of this professional sector may become more

NUCLEAR POWER 139

limited at the same time as the production of `problems' increases . The further promotion of industrialisation in general, and certain cul-de-sac technologies in particular, thus leads to incalculable ecological and social effects . To keep the system going more industrialisation will have to take place, requiring `faustian bargains' 58 of which nuclear power is only one . The `green' movement of today is a sign that not everybody is resigned to this development .

Industrialism as a social system has created powerful ideologies to legitimate its development . Resistance to industrialism has historically taken many forms . In the early stages of the industrial revolution the working population, driven from the land by enclosure and suffering from the appalling conditions in the new industrial towns, often had the desire to go back to the country and work the land independently . 59 Another source of resistance to industrial development in Brtain has been the landed gentry, whose protest in the late 19th century led to the establishment of the alkali inspectorate, still the backbone of British pollution control . 10 The Luddite movement, alternative land communities and the socialism of William Morris are other examples of antiindustrialist stances . Such movements have long been discredited by 'marxist' authors as obsolete and reactionary . But with hindsight, some of their aims merit far more serious consideration . 61 All these early forms of resistance were carried out by people who had not yet been absorbed in industrialism or who were in positions marginal to or outside production and industry . The working classes soon lost their `back to the country' desires, although the rambling movements of the late 19th and early twentieth century in the north-west of England clearly demonstrate their basic dissatisfaction with the environmental conditions of industrial towns . 62 There was certainly resistance in some sectors against reorganisations of the labour process but they largely remained marginal and did not anywhere approach the destruction of that process . 69 This must be seen as one major dilemma of the labour process approach : it comprehensively explains how labour becomes more and more fragmented, workers atomised, its chances of political disruption minimised, and so forth . But it shows hardly any way out of it in the form of successful protest or resistance . Labour process theoreticians might hope that the experience of being subjected to political control through the labour process might create an incentive to resist . But the theory itself would perfectly explain why such action is not forthcoming . The very process of control removes the preconditions necessary for such resistance to be expressed .

Forms and social bases of resistance

CAPITAL & CLASS 140

Looking at the modem stages of industrialism, it should not surprise us that resistance again forms in social sectors marginal to the production sector . In the US, France and Germany the farming populations around prospective nuclear sites, who feared the further industrialisation of their area, the destruction of their economic base and way of living, took up the struggle with stiff local resistance . It was the forceful suppression of such action by police forces in France and Germany which made nuclear power a political issue there and led to a significant involvement by the left . In Britain, local resistance has not been forthcoming to the same extent, simply because the number of new nuclear power installations in the 1970s was very limited . Only at Torness and later at Luxulyan did significant local opposition arise, but in both cases an escalation of the conflict was avoided by the authorities ." Apart from the rural population directly confronted with nuclear installations, anti-nuclear protest is mainly carried out by sections of the population outside the production sector. As surveys of members of environmental groups have shown, the majority of them come from the non-productive service sectors such as education, the arts and health . 65This is, however, not only a characteristic of the environmental movement but also of the other main movements outside the trade union movement . The Campaign for Nuclear Disarmament, for example, recruited its members from exactly the same social base ."' Another group outside the direct control of industrialism are the unemployed . They might be expected to protest about purely economic issues rather than environmental issues, or, more likely, fall into passive agony interrupted by occasional destructive action . The German `alternative' movement, however, has succeeded in involving unemployed people in alternative projects of various kinds . The unemployed seem to have played a major role in struggles for the maintenance of cheap housing . They have thus become part of the `green' movement fighting a whole range of issues ." The `alternative' and `green' movements thus have their social bases where the social control of `industrialism' is weakest . In my view, they cannot be characterised as `new working class' as Spence suggests . He does not make the vital distinction between , new workers' in the `productive' state sector, who obviously have internalised the values of 'super-industrialism' and those outside the `productive' sector who have chosen to avoid direct subordination to its stringent rules, 68 or whose relative freedom from such subordination has allowed them to perceive and act on the `destructive' impacts of 'super-industrialism .' The new, alternative technologies will not be developed

NUCLEAR POWER and disseminated as `additions to the technological store' but only after new resources are set free by terminating technologies and their organisational support . In short, a new form of Luddism is required '69 which is geared to dismantling the results of previous `socialist' state-interventionist policy . Previously, socialist theory has recognised a need to dismantle complete industrial sectors only in the case of the military-industrial complex understood as an `abuse' of technology . Such an understanding is too narrow and has to be extended to other sectors of a `peaceful' nature with similar destructive potentials . If resistance to cul-de-sac technologies should become part of a socialist strategy, then the view of `nationalised industries' has to change dramatically . If, as Offe quite rightly suggests, it is `state interventionism' which at least in some countries is the prime protagonist of 'super-industrialism', then some creations of this interventionist policy will have to be dismantled . Considering the social base of the `green' movement, what are the chances that they will be politically successful? Spence has suggested that `these new workers . . . are vital to capitalist development . ' 10 This is, in my view, a misjudgement . As analyzed above, the new movement only emerged as a result of certain social sectors not being directly subordinated to the laws of equivalent exchange . At the same time, they are in a marginal position as regards capitalist development, and therefore do not pose a significant threat of disruption . Furthermore, significant parts of the `alternative' movement are directly dependent on the welfare state . There can be no illusion that the so-called 'alternative economy' is viable on its own : it depends, firstly, on direct state subsidies in the form of grants ; secondly, on indirect subsidies in form of social-security payments ; and thirdly, on the economic well-being of the `non-productive service sector' which provides the large majority of its consumers ." This situation obviously puts the `green' movements in a rather difficult position . On their own, they are unlikely to be able to reach the fundamental transformation of society they deem to be necessary . Martin Spence's central point is that there should be a coalition between the new and the old social movements ; the green and the trade union movements . Such a demand is not new but is nevertheless of undiminished topicality . In Britain, Dave Eliott and SERA are veteran campaigners for such action." In France the CFDT has been successfully involved in environmental and anti-nuclear struggles . In Germany such views have also been put forward frequently and a special group Aktionskreis Leben (Action Group Live) was set up to promote trade union discussion on the nuclear power issue . How successful have these attempts been so far? In Germany the unions have taken and

141

CAPITAL & CLASS 142

maintained a thoroughly pro-nuclear attitude . The `Aktionskreis Leben' did not succeed in stimulating major intra-union discussion on nuclear power and employment . Their work was seriously hampered by the very hierarchical internal union structure, given the German Federation of Labour leadership's firm control of union policy ." The Federation went as far as to support a mass pro-nuclear rally in Dortmund in 1977 in response to previous anti-nuclear demonstrations in Brokdorf . Particularly noteworthy is the German government's success in winning the support of the coal miners for its policy . The Social Democrats adopted a policy of `first coal, then nuclear' . The SPD was only prepared to accept further nuclear expansion if additional energy demand could not be met by coal . The Social Democratic/Liberal government of Northrhine-Westfalia, where the main German coal resources are situated, declared a temporary ban on nuclear stations to protect the interests of the coal industry . Thus both the coal miners and the whole trade union movement were assured that nuclear expansion would not be carried out at the expense of existing energy sectors, and this made them loyal supporters of the government's general pro-nuclear stance . The trade unions were also the main force inside the SPD supporting the party leadership in their conflict with the party's left wing demands for a halt to nuclear development" . In France, the communist union CGT and the moderate socialist union FO are both staunch supporters of nuclear power . But the predominantly socialist union CFDT has voiced strong criticism of the nuclear programme . The CFDT favours nuclear energy in principle, but is critical of the size and the implementation of the programme . The CFDT have even participated in a common front with ecologists on several occasions . In 1979, a joint petition with Friends of the Earth and other groups was signed demanding a nuclear moratorium"' . Why is it that such a close association between the CFDT and the ecologists is possible in France? First one has to note the CFDT'S ideological background : it is a 'left-socialist' union with strong `syndicalist' tendencies favouring a 'socialisme autogestionnaire', i .e . a socialist society with self determination for all factories and social and political units . It is opposed to the traditional French centralism and has been strongly influenced by the ideas of May 1%8 76 . Secondly, the French ecologist movement has very strong counter-cultural and left-wing tendencies . The French Friends of the Earth, for example, understand themselves as `socialists' in the broadest sense and demand fundamental social changes" . Thus, to the CFDT in France than they are to any union in Britain the environmentalists are ideologically far closer . The German environmental movement may be rather leftist, too, but there is

NUCLEAR POWER no trade union partner like the CFDT available to it . Thirdly, health and safety problems have led to a series of industrial conflicts . Besides many white collar workers in the public sector the CFDT also organises many employees of the nuclear industry . Appalling safety conditions at the La Hague reprocessing plant did much to raise the issue . Strikes were held in La Hague, and also at a number of nuclear power stations, when it was planned to start operating these plants despite cracks detected in the pressure vessel . These actions were partly undertaken jointly with the CGT . 78 In the case of the CFDT, involvement in the nuclear industry has not, as in other countries, enlisted their unequivocal support of nuclear power . Their concrete experience of the nuclear industry has led the CFDT to scepticism and a critique of the pace and content of the French nuclear programme . Nuclear power as such is nevertheless not rejected . However, the nuclear issue seems to be pushed only by a limited number of union leaders with the rank and file largely uninterested . According to Lucas, Most CFDT members are just `fed up' with the issue, 7 B and anti-nuclear activists have expressed their disillusionment with the total lack of involvement of the CFDT membership in anti-nuclear actions ." In Britain, the trade union movement is far more fragmented than in France and Germany ; less hierarchical than in Germany and organised primarily according to crafts and economic sectors rather than by ideology as in France . SERA has been quite successful in bringing discussions on energy and employment into the unions, and quite a number of them have passed critical motions at their conferences . The TUC since its first statement on nuclear power in 1955 has, however, never waned in its support for the nuclear industry . The TUC's energy policy making body, the Fuel and Power Industries Committee, has quite often been more 'pro-nuclear' than the government of the day . In 1977, the TUC Committee objected to the Labour Government's call for a public inquiry to look into Windscale . The TUC's estimates of future energy demand have also been higher than Department of Energy's figures . 81 In 1980, Congress passed a motion demanding more nuclear generation capacity than even the Conservative government was planning to build . The most important issue about nuclear energy in union politics has been the question of the reactor choice . The majority . of unions have traditionally been hostile to the LWR and in favour of the British AGR though the TUC is now less firm on this position . In 1974, it rejected the LWR in favour of the British Steam Generating Heavy Water Reactor (SGHwR) . But by 1978, the TUC Fuel and Power Industries' Committee had dropped its

143

CAPITAL & CLASS 144

opposition to a PWR, a position confirmed in July 1979 shortly after the Conservative government had taken office . Most British unions, however, appear to be opposed to the PWR . Looking at the unions which have adopted a general anti-nuclear stance, one can identify quite clearly the predominance of unions representing the `non-productive service sector' . The main exception is the coal miners' union . This is in marked contrast to the German situation . The leaked cabinet minutes of December make it quite clear that nuclear power is seen in a favourable light because of its detrimental effects on the miners' power . Taking over from SERA, the Anti-Nuclear Campaign (ANC) decided to make the trade union campaign its main political action . Since its foundation in 1979, there have not been many successes . With the exception of the NUM, no other major union seems to have been won for the anti-nuclear cause . It also appears that the involvement of the anti-nuclear unions in movement activities are rather limited . Except for passing motions at conferences and sending a delegate to the odd meeting, there does not seem to have been any significant input into the anti-nuclear movement from the trade union side . It is doubtful whether the Sizewell Inquiry will bring a change . The ANC opted to form a broad-based anti-PWR campaign based on the unions, and succeeded in involving unions which would be inclined to accept an AGR, such as the Transport and General Workers Union (TGWU) . That such a strategy could create problems became apparent at the Anti-Sizewell Rally in November 1982 when a TGWU representative felt compelled to distance himself from the general anti-nuclear (rather than anti-PWR) tone of the rally . Looking at a number of other countries, there is evidence that unions can under certain conditions, take a very active stance . In a country with no nuclear industry and a long-standing anti-nuclear activist as Vice-Chairman of the biggest individual trade union, one might expect the chances of the trade union movement committing itself to an anti-nuclear stance to be high . This happened in Ireland, where John Carroll and his Irish Transport & General Workers Union (IT&GWU) started a major initiative to oppose plans for a first nuclear power station at Carnsore Point ." Other experiences in Australia and Canada suggest that unions can play a major role in disrupting the nuclear industry . Canadian longshoremen repeatedly refused to handle nuclear material to, or from, Argentina where Canada has just finished constructing a CANDU nuclear power station . The campaign `No Candu for Argentina' did, however, only oppose nuclear cooperation with Argentina on human rights grounds." In Australia trade unions played a major role in the cam-

NUCLEAR POWER paign against uranium mining . Starting in May 1976 with a one day strike by the Australian Railway Union, there have been a number of actions by trade unions to stop mining development . From 1979 to 1981, the Australian Council of Trade Unions (ACTU) imposed a ban on any uranium shipment . While this union action in close co-operation with environmental groups constituted a major threat to the Australian uranium mining industry, the campaign suffered a major set-back when the ban was lifted in 1981 . This occurred in the context of fierce inter-union disputes between mining workers opposing the ban and transport workers and dockers providing the back-bone of the anti-nuclear action on both environmental and political grounds ." To, assess the possible role of trade unions in an antinuclear campaign, the following factors have to be taken into account . Unions will more likely become active in this field if the existing nuclear industry in the country is small ; the union members themselves are either economically threatened by, or are not dependent on nuclear development ; if the cause is limited, to say, opposition on human rights grounds or against a particular reactor line ; and if the ideological stance of the union is noncommunist, grass roots based, left-socialist . Under certain conditions and for limited purposes, successful co-operation between the anti-nuclear and trade union movements could thus be expected . Nevertheless, a number of features central to the trade union movement make it, in my view, highly unlikely that in their present form they will play a dominant role in the social transformations considered necessary to stop 'cul-de-sac technologies' and `super-industrialism' . First of all, it is the task of trade unions to defend the interests of their members . Once certain industries have developed, trade union activity will try to secure the continued existence of that sector as source of employment for its members . Thus, trade unions play a highly conservative role in the sense that they contribute to cementing existing industrial structures. It thus cannot be expected that anti-nuclear positions will gain any major support from trade unions significantly involved in the nuclear sector . Secondly, the trade union movement in the main accepts the fundamental logic of industrialism . Looking at the trade unions with a critical attitude to nuclear power, they are predominantly located outside the mainstream production sectors, in much the same way as the other social bases of anti-nuclear protest" . Thirdly, there are tremendous difficulties in capitalising on the support given by trade unions to the anti-nuclear movement . That support seems to have consisted mainly in passing motions at conferences . In most countries, there does not seem to have been any significant C . a C.

20-J

145

CAPITAL & CLASS 146

involvement of trade unionists in anti-nuclear activities as such . The only tangible effect might come from influencing Labour Party policy and getting an anti-nuclear motion passed at congress . But that, in itself, would far from guarantee a change in Labour Party policy, and even less the policy of a Labour government . Furthermore, there is no prospect of any strike action forthcoming on this issue which could off-set the weak bargaining power of the anti-nuclear movement . Fourthly, the only effective trade union resistance to new industrial development has taken the form of protecting an established economic sector challenged by new developments . There is a long-standing British tradition in that area which may have contributed significantly to the fact that Britain is perhaps further away than other countries in material terms, although not ideologically, from a 'super-industrial' society . Also in the nuclear case, Britain is perhaps the only country where such resistance has become of major importance in the form of the mine workers' stance . Resistance would be expected from the mine workers more than from any other sectors of the trade union movement as the Conservative government has obviously conceived its nuclear programme with the miners in mind in an attempt to deprive them both of their economic and political standing . The miners are one, relatively homogenous group with a tradition of radical action unlike the disparate nature of the other trade unions concerned. Nevertheless, strike action seems to be highly unlikely for the time being . The union might objectively be better off in the long run arranging a deal on the lines of their German counterparts . Their resistance is also only geared against one particular 'cul-de-sac technology', and they are generally in favour of other forms of 'super-industrialism' . There seems to be relatively little concern for the environmental effects of coal development and use (eg Belvoir, acid rain) . In Britain the anti-nuclear movement is certainly on a sticky wicket : it has not received the same public attention as on the continent ; there have been far fewer local conflicts ; and in general fewer opportunities to raise the issue of nuclear power politically . But even numerically strong movements such as those in France and Germany have not achieved any significant involvement of trade unionists in antinuclear activities as such . On the whole, therefore, I share Alain Touraine's assessment that, at present, the trade union movement will not be the movement through which the `green' forces could hope to reach their major aims ." This state of the working class movement must not be seen, however, as its own fault or responsibility . Instead, it is in itself an expression of the power of industrialism, tying the worker to the machine, forming and maintaining an

NUCLEAR POWER ideology, and in many cases, turning to open job blackmail in playing off environmental against employment issues ." Martin Spence is far from uncritical of the structures and predominant pro-nuclear attitudes of British trade unions . He is advocating alliances of the anti-nuclear movement with those unions and unofficial elements of the trade union movement sympathetic to the anti-nuclear movement . I also consider this to be highly desirable and fruitful . But I feel that Spence overemphasises the contribution of such a strategy for the anti-nuclear movement . I am afraid that the movement could lose part of its identity and strength if it concentrates too much on winning over the labour movement at the present time . Spence misjudges the role of the French Socialists and the German Social-Democrats on nuclear energy ." Both parties fudged the issue thoroughly, and in both countries the anti-nuclear movement has been left only with feelings of resentment and disillusionment . The German `Greens' and their recent success in the election are the direct result of the Social-Democrats being unable to accommodate the movement's demands . I do not see any reason why a British Labour government should not handle the British anti-nuclear movement in much the same way, particularly as the British movement is far weaker than its continental counterparts . It would be equally dangerous, in my view, if the antinuclear movement were to confine itself to following the path of changing, short-term coalitions on single issues . The ANC is perhaps a sad example of how an organisation originally founded to spearhead a new forceful movement degenerates into just one of many pressure groups . Although I am only too well aware of other factors which have contributed to this decline, (the rise of CND, for example), I wonder whether the almost exclusive concentration on one particular approach - trade union work - has not been counterproductive . There could have been other approaches which would have allowed it to remain a fairly broad based body ; perhaps focusing, more on local and regional antinuclear activities and developing into a national mouthpiece of them . Once an independent `green' movement has constituted itself one might think of 'red/green alliances' to carry out common policies . But the possibility of any political impact would greatly be reduced if the movement gets co-opted too early in its development . The emphasis, in my view, should therefore lie on building the movement's identity and independence . There can, however, be no illusions about the strength of even a fully independent movement . It must be careful not to overstretch its resources . There is no immediate alternative recipe to overcome this weakness . The only lesson which seems appropriate is cautious-

147

CAPITAL & CLASS 148

ness . Radical transformations, which on one hand seem necessary, could on the other hand seriously damage or even destroy the movement as such . Serious social crises would most certainly lead to the imposition of authoritarian measures leaving the movement no channels of political activity . The movement has not got the power to physically prevent-the installation of nuclear power stations with direct action, as the experiences of the numerically far stronger French and German movements have shown . An electoral strategy could bear fruits as in Germany, but such successes do not seem likely in Britain for the time being . The movement has not many resources to create the opportunities for itself, it has to take what comes along and make the best out of it .

Conclusions

Nuclear power is a 'cul-de-sac technology' promoted by a nuclear-industrial complex entrenched in energy policy-making and dependent on state support . Such support is forthcoming where, in the state's perception, the further promotion of nuclear power is necessary to secure the national long-term energy security politically . At the same time, capitalism is unlikely to be totally dependent on nuclear power for its further survival, and might indeed be better off without it . As a cul-de-sac technology, nuclear power has been determined in its very nature by capitalist relations of production which cannot be off-set by other forms of using the technology under different political conditions . As such, nuclear power is, however, only a symbol of a new phase of capitalist development to a super-industrial society which involves the incalculability of environmental and social impacts of individual technologies as well as super-industrialism as a whole to the extent that major destructive forces might be set free . The anti-nuclear and environmental movements have to be seen as central opposition movements to this development, having the objective function of emancipatory social movements whatever their own actual understanding of their role . The `old' social movements are primarily oblivious to or actively supportive of superindustrialism', although some important opposition, either in form of opposition to individual technologies challenging established industries (NUM) or as part of a more general consideration of social progress (CFDT) can be observed . What are the consequences of this analysis for the relation of new and old social movements? The differences between trade union movements and the ecological movements cannot be overlooked . I would follow Touraine in identifying the anti-nuclear movement as a potential

NUCLEAR POWER 149

Photomontage : Peter Kennard

new social movement reflecting a new political cleavage . While Touraine et al identify `technocratic power' as the adversary of this movement and the transfer to `post-industrial society' as its aim . 90 I would prefer to substitute `super industrialism' for the former and `ecological socialism' for the latter. More important is, however, the analytical point of taking the `green movement' seriously as an independent movement in its own right which cannot readily be subsumed under the labour movement . In view of the above discussion of nuclear technology and environmental problems, it would in my view be totally wrong to demand from the environmental movement a closer involvement with the labour movement in its present form if that implied renouncing central arguments and concerns . This seems to have

CAPITAL & CLASS 150

been the dominant approach taken by leftist critiques of the ecologists," and Spence partly stands in that tradition . In his view, the anti-nuclear movement displays many reactionary, romanticist facets . One cannot deny that some of the ideological constructs used to explain environmental problems might be characterised in these terms, but these criticisms do not apply to the basic aims of the movement or the social function they are playing . The ecologists are an ideologically very mixed group of people, ranging from eco-fascists to, say, eco-communists, but their objective function in social development has to be the central evaluative concept . In this context, there is in my view no point in criticising the ideological shortcomings of environmentalism from the seemingly high position of marxist insights . Much of this has been generated by the failure to create a political mobilisation of significant numbers of people with such insights . This has seen marxists trying to convert all movements springing up without having quite the `right' consciousness . It would, however, be far more significant if ecological problems were taken seriously, even if that entailed a total revision of standard marxist concepts . Instead, ecological problems are re-formulated so as not to upset familiar concepts of analysis . The overwhelming prominence of the production sector in marxist analysis, for example, leads Spence and others to the attempts to derive environmental problems from traditional capital-labour conflicts at the workplace . Such an interpretation, as I have tried to show, is not adequate . It furthermore cements the existing political division of labour with, say, the British Society for Social Responsibility in Science almost exclusively concerned with environmental hazards at the workplace, and other mainstream environmental organisations exclusively concerned with environmental hazards everywhere else but the workplace . To remove that division, both sides have to take the problems concerned seriously . Spence's argument for an incorporation of an anti-nuclear programme into a general socialist programme does not suffice, if socialism still remains a synonym for Big Industry and 'super- industrialism .'

Acknowledgements I gratefully acknowledge the valuable comments and help I have received from a wide range of people including the editorial committee of CAPITAL & CLASS . I am particularly grateful to Martin Spence for his comradely counter-critique of an earlier draft of this paper, and to Sonia Liff for her careful editing of the text .



NUCLEAR POWER 1 For example, E .H .S . Burhop, `The peaceful applications of atomic energy', The Marxist Quarterly, Vol 1, No . 2, April 1954, pp.8293 . 2 Margaret Gowing and Lorna Arnold, The atomic bomb, London etc . : Butterworths 1979 . 3 Friedrich Munzinger, Atomkraft: Der Bau ortsfester and beweglicher Atomantriebe and seine wirtschaftlichen and technischen

Probleme, 3rd ed ., Berlin etc : Springer 1%0, pp .259-260 . 4 Harold Orlans, Contracting for atoms : A study of public policy issues posed by the Atomic Energy Commission's contracting for research, development and managerial services, Washington, DC : Brookings

Institution 1967 . 5 Ulrich Rodel,

Forschungsprioritaten and gesellschaftliche Entwicklung: Studie uber die Determinanten der Forschung and Technologiepolitik in den USA, Frankfurt/Main : Suhrkamp 1972, pp . 147,

169-170 . 6 Irvin C . Bupp and Jean-Claude Derian, Light Water: How the nuclear dream dissolved, New York : Basic Books 1978, pp . 19-20 . 7 Harald Glatz, `Zum Durchsetzungsprozefi von Kerntechnologien', Osterreichische Zeitschrift fur Politikwissenshaft, Vol . 9, No . 1, 1980, pp .81-91 . 8 On the nuclear development in the us, see in particular Wendy Allen, Nuclear reactors for generating electricity : us Development from 1946 to 1963, Santa Monica Ca : RAND Corporation 1977 ; Frank G Dawson, Nuclear Power: Development and management of a technology, Seattle, Wa . : University of Washington Press 1976 ; Philip Mullenbach, Civilian nuclear power: Economic issues and policy formation, New York : Twentieth Century Fund 1963 ; Lee C Nehrt, International marketing of nuclear power plants, Bloomington Ind . : Indiana University Press 1966 ; Robert Perry et al., Development and commercialization of the light water reactor, 1946-1976, Santa Monica, Ca : RAND Corporation 1977 ; Harold Orlans, op. cit. (ref. 4) ; Irwin C Bupp and Jean-Claude Derian, op . cit. (ref 6) . 9 Irwin C Bupp and Jean Claude Derian, op . cit (ref. 6), p .40 . 10 Robert Perry et .al., op . cit . (ref.8), p .35 11 This point is well made by Irwin C Bupp, and Jean-Claude Derian op .cit., (ref 6) . 12 Op . cit., pp .74-75 . 13 Op .cit., p .50 ; Peter deLeon, Development and diffusion of the nuclear power reactor: A comparative analysis, Cambridge, Ma . : Ballinger 1979, p .217 . 14 Irwin C Bupp, and Jean-Claude Derian, op.cit., (ref 6), pp .7475 ; Robert Perry et al ., op .cit. (ref 8), p.80 . 15 Robert Perry et al ., op. cit. (ref 8), p .46 . 16 Man Lonnroth, and William Walker, The viability of the civil nuclear industry, New York/London : Rockefeller Foundation/Royal Institute of International Affairs 1979 . 17 William Walker, `Utilities and energy conservation : Implications of recent developments in utility policy in the United States', in : Facing the Energy Future: does Britain need new energy

Notes and references

151



CAPITAL & CLASS 152

institutions? London : Royal Institute of Public Administration 1981, pp .61-69. 18 Barry R . Weingast, `Congress, regulation, and the decline of nuclear power', Public Policy, Vol . 28, No . 2, Spring 1980, pp .231-255 . 20 On the German nuclear development, see Helga Bufe and Jurgen Grumbach, Staat and Atomindustrie : Kernenergiepolitik in derBRD, Cologne : Pahl Rugenstein 1979 ; Christian Deubner, `The expansion of West German capital and the founding of Euratom', International Organization, Vol 33, No .2, Spring 1979, pp .203-228 ; Otto Keck, Policymaking in a nuclear program : the case of the West German fast breeder reactor, Lexington, Ma : Lexington D .C . Heath & Co . 1981 ; Herbert Kitschelt, Kernenergiepolitik : Arena eines gesellschaftlichen Konfliku, Frankfurt/New York : Campus 1980 ; Lutz Mez, `Atompolitik- Der unaufhaltsame Aufstieg zur Atommacht?' in : Hans-Karl Rupp (ed .), Die andere Bundesrepublik : Geschichte and Perspektiven, Marburg/Lahn :/Guttandin & Hoppe 1980, pp . 195-222 . 21 On the French nuclear development, see Bertrand Goldschmidt, The atomic adventure : its political and technical aspects, Oxford etc. : Pergamon Press 1964 ; Bertrand Goldschmidt, La complexe atomique : Histoire politique de 1'energie nucleaire, Paris : Fayard 1980 ; Dominique Saumon, and Louis Puiseux, `Actors and decisions in French energy policy', in : Leon N Lindberg (ed .), The energy syndrome, Lexington, Ma . : Lexington Books, D .C . Heath & Co . 1977, pp .119172 . ; N . J . D . Lucas, Energy in France: Planning, politics and policy, London : Europa Publications 1979 ; Laurence Scheinman, Atomic energy policy in France under the Fourth Republic, Princeton, N .1 ., : Princetown University Press 1965 . See the excellent study by Laurence Scheinman, op .cit (ref.21) 22 On the British nuclear development, see C . M . Buckley and R . 23 Day, `Nuclear reactor development in Britain', in : Keith Pavitt (ed), Technical innovation and British economic performance, London and Basingstoke : Macmillan 1980, pp .252-266 ; Duncan Burn, The political economy of nuclear energy, London : Institute of Economic Affairs 1967 ; Duncan Burn, Nuclear power and the energy crisis: Politics and the atomic industry, London and Basingstoke : Macmillan 1978 ; Margaret Gowing (assisted by Lorna Arnold), Independence and deterrence: Britain and atomic energy 1945-1952, 2 vols ., London and Basingstoke : Macmillan 1974; Roger Williams, The nuclear power decisions: British policies 1953-78, London : Croom Helm 1980 . 24 J .H . Cheshire et al ., `Energy policy in Britain : A case study of adaption and change in a policy system', in Leon N . Lindberg (ed .), The energy syndrome, Lexington, Ma . Lexington Books, D .C . Heath & Co . 1977, pp .33-62 . Philip Gummett, Scientists in Whitehall, Manchester : 25 Manchester University Press 1980, p . 125 . Howard J . Rush, Gordon MacKerron, and John Surrey, `The 26

NUCLEAR POWER advanced gas-cooled reactor : A case study in reactor choice', Energy Policy, Vol . 5, No . 2, June 1977, pp . 95-105 . 27 Marian Radetzki, Uranium : A strategic source of energy, London : Croom Helm 1981 . 28 Man Lonnroth, and William Walker, op . cit . (ref. 16) . 29 . Martin Spence, `Nuclear capital', Capital and Class, No . 16, Spring 1982, pp . 5-40 (here : p .20) . 30 Claus Offe, Strukturprobleme des kapitalistischen Staates, Frankfurt/Main : Suhrkamp 1972 ; Claus Offe, "Crises of crisis management" : Elements of a political crisis theory', International Journal of Politics, Vol . 6, No . 3, 1976, pp . 29-67 . James O'Connor, The fiscal crisis of the state, New York : St . Martin's Press 1973 ; Jurgen Habermas, Legitimation crisis, London : Heinemann 1976 . 31 Peter de Leon, op. cit. (ref. 13), p . 229 . 32 See, for example, Joachim Hirsch, Wissenschaftlich-technischer

Fortschritt and politisches System : Organisation and Grundlagen administrativer Wissenschaftsforderung in der BRD, Frankfurt/Main : Surhkamp 1970 ; Joachim Hirsch, Staatsapparat und Reproduktion des Kapitals, Frankfurt/ Main : Surhkamp 1974 ; Ulrich Rodel, op . cit . (ref. 5) . 33 Claus Offe, op .cit . (ref. 30), pp . 124-125 (my translation). 34 Martin Spence, op . cit . (ref. 29), pp . 12-14 . 35 Roy Lewis, `Nuclear power and employment rights', Industrial Law Journal, Vol . 7, No . 1, March 1978, pp . 1-15 ; see also Dave Elliott et al, The politics of nuclear power, London : Pluto Press 1978 . 36 David Elliott, Energy options and employment, London : Centre for Alternative Industrial and Technological Systems, North East London Polytechnic 1979 . 37 David Pearce, Employment and energy futures in the ux ;An analysis of the GAITS scenario, Aberdeen : Department of Political Economy, University of Aberdeen 1979 . This point of view is put forward, for example, by Helga Bufe, 38 and Jurgen Grumbach, op .cit. ref.20 . For a presentation and thorough critique of this view, see 39 Stefan Lob, 'Atomenergie - Zur Struktur eines gesellschaftlichen Konflikts', in Heinz Hulsmann, and Robert Tschiedel (eds .), Kernenergie und wissenschaftliche Verantwortung, Kronberg/Ts . : Athenaum 1977, pp . 123-154 . 40 Lutz Mez, and Wolfgang Rudig, Energiediskussion in Europa :

Berichie and Dokumente uber die Haltung der Regierungen und Parteien in der Europdischen Gemeinschaft zur Kernenergie, Villingen : Neckar Verlag 1979 . 41 of work

Harry Braverman, Labor and monopoly capital : The degradation in the twentieth century, New York : Monthly Review Press 1974 .

For analyses in this vein, see Harley Shaiken, 'Neue 42 Technologien and Organisation der Arbeit', Leviathan, Vol . 8, No . 2, August 1980, pp . 190-211 ; CSE Microelectronics Group, Microelectronics: Capitalist technology and the working class, London : CSE Books 1980.

153



CAPITAL & CLASS See, for example, Feliks Gross, `Some social consequences of 43 atomic discovery', American Sociological Review, Vol . 15, No . 1, February 1950, pp . 43-50 . 44 BSSRS Politics of Energy Group, Nuclear power - The rigged debate, London : British Society for Social Responsibility in Science 1981 ; Les Levidov, `Review of "The Nuclear State" (by Robert Jungk)', Head and Hand, No . 4, Spring 1980 . Les Levidov, `Controlling nuclear technology' in : Gari Donn (ed), Missiles, Reactors and Civil Liberties : Against the Nuclear State, Glasgow, Scottish Council for Civil Liberties, not dated, pp . 34-37 . 45 BSSRS Politics of Energy Group, op . cit. (ref . 44), pp . 23 . 46 Les Levidov, op . cit. `Review of "The Nuclear State"' (ref. 44) . 47 Martin Spence, op . cit . (ref. 29), p.12 . 48 Otto Ullrich, Technik and Herrschaft vom Hand-werk zur verdinglichten Blockstruktur industrieller Gesellschaft, Frankfurt/Main : Suhrkamp 1977 ;Otto Ullrich, Weltniveau : In der Sackgasse des Industriesystems, West Berlin : Rotbuch Verlag 1979 . Norbert Kapferer, `Small is beatuiful - eine ortlose Utopie? 49 Leviathan, Vol . 6, No . 2, July 1978, pp . 314-323 . Hassenpflug has pointed out, that `science and technology' are 50 according to Marx not synonymous with `productive forces' . Science and technology can have both `productive' and `destructive' effects . See Dieter Hassenpflug, 'Marxismus and Industriekritik : Otto Ullrichs "Weltniveau" and der marx' sche Begriff der Industriekritik', PROKLA 40 (Vol . 10, No. 3), 1980, pp . 114-130 . Stefan Lob, op . cit. (ref. 39), p . 135 ; 51 Lutz Mez, 'Der atom-industrielle Komplex', in : Hans-Christian Buchholtz, Lutz Mez, and Thomas von Zabern, Widerstand gegen Atomkraftwerke, Wuppertal : Peter Hammer Verlag 1978, pp . 11-25 : Erich Kitzmuller, 'Wachstum der Produktiv- oder Destruktivkrafte?' in Lutz Mez, and Manfred Wilke (eds), Der Atomfilz: Gewerkschaften and Atomkraft, West Berlin : Olle & Wolter 1977, S . 77-91 . Amory B . Lovins, Soft energy paths : Towards a durable peace, 52 Harmondsworth : Penguin 1977 . Volmar Lauber, `Ecology politics and liberal democracy', 53 Government and Opposition, Vol . 13, No . 2, Spring 1978, pp . 199-217 . 54 Thies Gleiss, and Winfried Wolf, Der Atomverein nach Harrisburg, Frankfurt/Main : isr Verlag 1980, p . 93 . Wolfgang Sassin, `Energy', Scientific American, Vol . 243, No . 55 3, September 1980, pp . 107-117 . Wolf Hafele, 'Hypotheticality and the new challenges : The 56 pathfinder role of nuclear energy', Minerva, Vol . 12, 1974, pp . 303-322 (here : p .317) ; Cp . also Alvin M . Weinberg, `Science and trans-science', Minerva, Vol . 10, 1972, pp . 209-222 . 57 Martin Janicke, Wie das Industriesystem von seinen Mif3sstaiiden

profitiert, Kosten and Nutzen technokratischer Symptombekampfung : Unnweltschutz, Gesundheitswesen, innere Sicherheit, Opladen : Westdeutscher Verlag 1979 .



NUCLEAR POWER 58 Alwin M . Weinberg, `Social institutions and nuclear energy', in : John Francis, and Paul Albrecht (eds .) Facing up to nuclear power, Edinburgh : St . Andrew Press 1976, pp . 21-39 . 59 E .P . Thompson, The making of the English working class, Harmondsworth : Penguin 1968, pp . 253-256 . Maurice Frankel, The alkali inspectorate : The control of 60 industrial air pollution, London : Social Audit 1974 . 61 Raymond Williams, The Country and the City, London : Chatto & Windus 1973 . 62 See Howard Hill, Freedom to roam : The struggle for access to Britain's moors and mountains, Ashbourne, Derbyshire : Moorland Publishing Company 1980 ; Paul Salveson, Will you come o' Sunday mornin? The 1896 battle for Winter Hill, Bolton : Red Rose Publishing 1982 . Craig R . Littler, The development of the labour process in 63 comparative perspective : A comparative study of the transformation of work organization in Britain, Japan and USA, London : Heinemann Educational Books 1982 . 64 Wolfgang Rudig, `Public protest against nuclear energy : Some international comparisons' Unpublished paper, Department of Liberal Studies in Science, Manchester University 1982 . 65 Stephen Cotgrove, Catastrophe or cornucopia : The environment, politics and the future, Chichester etc : Wiley 1982, pp . 18-20 . 66 Frank Parkin, Middle class radicalism: The British Campaign for Nuclear Disarmament, Manchester: Manchester University Press 1968 . 67 Joseph Huber, Wer Boll das alles aifdern : Die Alternativen der Alternativbewegung, West Berlin : Rotbuch Verlag 1980 . 68 Andrew Duff, and Stephen Cotgrove, `Social values and the choice of careers in industry', Journal of Occupational Psychology, Vol . 55, 1982, pp . 97-107 . 69 Langdon Winner, Autonomous technology: Technics-out-ofcontrol as a theme in political thought, Cambridge, Ma ./London : MIT Press 1977, pp . 329-331 . 70 Martin Spence, op . cit . (ref. 29), p . 36 . 71 Joseph Huber, op . cit . (ref . 67) . Dave Eliott et al ., op . cit . (ref. 35) . 72 Manfred Wilke, Die Funktionare, Munich : Piper 1980 . 73 Lutz Mez, and Manfred Wilke, (eds) . Der Atomfilz : 74 Gewerkschaften and Atomkraft, West Berlin: Olle & Wolter 1977 ; Jorg Hallerbach (ed), Die eigentliche Kernspaltung: Gewerkschafren an Burgerinitiativen im Streit um die Atomkraft, Darmstadt/Neuwied : Luchterhand 1978 ; Herbert Kitschelt, op .cit. (ref. 20) . Tony Chafer, `The anti-nuclear movement and the rise of 75 political ecology', in : Philip G . Cerny (ed .), Social movements and protest in France, London : Francis Pinter 1982, pp . 202-220 . 76 Christel Hartmann et al., 'Grundstrukturen gewerkschaftliche Politik in Frankreich', in : Werner Olle (ed .), Einfuhrung in die internationale Gewerkschaftspolitik, Vol. 2, West Berlin : Olle & Wolter 1978, pp . 8-48 . 77 Claude-Marie Vadrot, L'icologie, histoire d'une subversion,

1551



CAPITAL & CLASS Paris : Syros 1978, pp . 184-192 . 78 J . S Eisenhammer, `The French Communist Party, the General Confederation of Labour, and the nuclear debate', West European Politics, Vol . 4, No . 3, October 1981, pp . 252-266 . 79 N .J .D Lucas, op cit . (ref. 21) p . 173 . Alain Touraine et . al., Anti-nuclear protest : The opposition to 80 nuclear energy in France, Cambridge : Cambridge University Press/Paris : Maison des Sciences de l'Homme 1983 . 81 Colin Sweet and Anna Coote, `Energy : Frank Chapple's fantasy', New Statesman, Vol . 102, No . 2644, 20th November, 1981, pp . 6-8 . Wolfgang Rudig, British political parties and trade unions on 82 nuclear power: A documentation of motions and resolutions, West Berlin : Institut fur Zukunftsforschung 1980 (mimeo) ; David Elliott, Trade union policy and nuclear power (Technology Policy Group Occasional Paper No . 3), Milton Keynes : Technology Policy Group, Open University 1981 . 83 John F . Carroll and Petra K . Kelly, (eds) Nuclear Ireland? Dublin : Brindley Dollard, 1980 ; Lothar Meyer and Petra Kelly, `Trades Unions and Nuclear Power : Ireland-Germany-Australia', New Ecologist, No . 3, May/June 1978, pp . 95-97 . Thijs de la Court, Deborah Pick and Daniel Nordquist, The 84 nuclear fix: A guide to nuclear activities in the third world, Amsterdam : World Information Service on Energy (WISE) 1982, p .27 . 85 Joseph Camilleri, `Nuclear controversy in Australia : The uranium campaign', Bulletin of the Atomic Scientists, Vol . 35, No . 4, April 1979, pp . 40-44 . Lothar Meyer and Petra Kelly, op . cit ., (ref. 83) ; Financial Times, 9th December, 1981 . 86 Cp . Michael Pollak, `Die westeuropaischen Gewerkschaften im Spannungsfeld technologiepolitischer Entscheidungen : Das Beispiel der Auseinandersetzung urn die Atomenergie', Journal fur Sozialforschung, Vol . 21, No . 2, 1981, pp . 123-140 . 87 Alain Touraine et al., op .cit . (ref. 80) . 88 Richard Kazs and Richard L . Grossman, Fear at work : Job blackmail, labor and the environment, New York : The Pilgrim Press 1982 . 89 Martin Spence, op. cit. (ref . 29), p . 19. 90 Alain Touraine et al., op cit . (ref. 80) . 91 Critiques of the us anti-nuclear movement (and responses to them) cover similar ground as the debates reported by Alain Touraine et al . for France and often touch on a similar note as Spence, s . Jeff Pector, `The nuclear power industry and the anti-nuclear movement', Socialist Review, No . 42, November/December 1978, pp. 9-35 ; Marcy Darnovsky, `A strategy for the anti-nuclear movement : Response to Pector', Socialist Review, No . 49, 1979, 119-127 ; Stephen Vogel, `The limits of protest ; A critique of the anti-nuclear movement', Socialist Review, No . 54, November-December 1980, pp . 125-134 ; Liv Smith, `Labor and the no-nukes movement', Socialist Review, No . 54, November/December 1980, pp . 135-149 .

Chris Baldry, Nigel Haworth, Simon Henderson and Harvey Ramsay Fighting multinational power: Possibilities, limitations and contridictions Despite the clamour of concern about the power and intentions of multinational capital across the spectrum of the left, the delineation of the problems and supposed solutions remains disturbingly nebulous . The authors of this piece attempt to develop some thoughts provoked by their experience as members of a group of academics called on in 1978 to provide help to the unions fighting the closure of the Massey Ferguson combine harvester plant in Kilmarnock, Ayrshire . Their immediate reflections on this episode concern the combative power of labour, the strategies and resources of a multinational corporation ranged against the workers and their supporters, and an effort to assess critically the role of research teams such as their own . These reflections have led the authors to reconsider questions about the nature of international capital, particularly its responses to the crisis and consequent pressure for restructuring production . This in turn opens the lid on issues involving the capacity of a government, or governments in concert, to intervene and redress labour's weakness, and no such discussion can ignore the debate on the nature of the capitalist State and the limits and constraints this imposes even on a putative left-sympathetic government . The centrality of these matters to the AES debate on control of multinational corporations and on industrial democracy is evident .

157



CAPITAL & CLASS 158

Massey Ferguson in Crisis We will first provide a condensed background to the events at Kilmarnock, which unsurprisingly but importantly can only be appreciated in their international context . By 1978 Massey Ferguson was the largest manufacturer of agricultural machinery in the capitalist world, employing 67,000, producing in 30 countries and selling in 190 . Its Canadian `home base' was practically non-existent, taking only 7% of corporate sales and employing only 1/3 as many as their largest operation, their `British' one . Nonetheless, control was firmly held in Toronto, and not by a technically-oriented management tied to a particular area of production expertise, but by financiers who were the largest shareholders in a two-tier financial holding company structure, the Argus Corporation, held in turn by the Ravelston Corporation . In the end a small group of men attuned to the logic of international finance (in fact, following a 1978 boardroom coup, a particular family within that network) made the decisions that determined the future of thousands of people around the world . When crisis came in the late 1970s, the room for manoeuvre by Masseys was constricted by a large number of joint ventures with overseas governments and licensee producers whom Masseys could not readily affect when it decided it had to reduce its operations . The nature and origins of the crisis were as follows . Massey Ferguson was operating in a market made unstable by seasonal demand and by the effect of recession on capital goods, and, more permanently, by the saturation of European and other markets, so that replacement buying predominated over new purchasing and was thus much more affected by varying prosperity of farmers . Yet while this

aspect of the crisis was real in the sense that there was an international crisis in the agricultural machine industry, it was overlaid and greatly intensified in its impact by management errors and consequent vulnerability. Over expansion and costly mistakes in strategy, achieved by heavy borrowing from the banks, left Masseys with borrowings about twice share capital . Thus although there was over capacity, the dominant and immediate pressure in 1978 was that of ebbing confidence by banks and on stock exchanges . In these circumstances the Black family gained control, appointed a new chairman of Massey Ferguson and set about restoring the value of Argus' holdings and the confidence of the banks . Masseys then had to look around for a strategy where they could make a significant cut in their operations to demonstrate to the finance vultures that they meant business in their talk of a 14% reduction in global labour . One of the areas where this was possible was the dual-sourced operation producing combine harvesters in Europe, at Marquette in France and Kilmarnock in Ayrshire .

Kilmarnock Set up in 1949 as a result of direction by the Attlee government, the Kilmarnock factory reached a peak of over 2000 employees in the 1960s, though by 1978 numbers had dropped to 1600 . In the 1960s the design department had been removed to Coventry (and later to Paris), and Kilmarnock had become dependent on a narrow range of products associated with medium-sized combine harvesters instead of its earlier wideranging product spread within agricultural machinery . Marquette, on the other hand, having been kept open after an earlier sourcing study decided that Kilmarnock would be the best single

STRATEGY location for making combines, had been massively expanded and modernised and made a wide variety of components for other Massey Ferguson operations, particularly the tractor plant at Beauvais . When the crisis finally came after the bad half-year results in May 1978, redundancies were announced in many Massey plants, in Canada, France and Britain . Kilmarnock suffered only 87 redundancies, coming off far lighter than the tractor factory at Banner Lane in Coventry, for instance . But the stewards smelled danger, particularly when short-time working arrived in the summer . They began a campaign in anticipation, along with representatives from other UK plants, holding meetings with management and with ministers from the Labour Government . In August the Minister for Industry, after talking to the corporation, assured the union he was `satisfied that the company have no plans to reduce the output of their UK operations permanently', while the company itself told the Combined Staff Unions that the UK redundancy programme was `virtually complete' . In the following month, September, a 'feasibility study' on European combine production was announced, with an explicit rubric to consider the closure of Kilmarnock (the closure of Marquette was never looked at as an option in the study which was produced, something which was ensured by the focus on combine production alone) . The stewards viewed the conclusion as already ordained, and when the unions were refused participation in the study they anticipated merely a justificatory exercise . They approached the Scottish Trade Union Congress through their unions, the Scottish TUC came to the Trade Union Research unit (Scotland) [TURU(S)[ which had been set up with

formal Scottish TUC links, and in turn 159 the Research Unit set up a small group of academics from Strathclyde and Glasgow Universities to liaise with and help the workers' representatives . The feasibility study was produced in just 5 weeks, and concluded that Kilmarnock should close (though a residual 500 jobs were initially to be saved by transferring production of a baler to Kilmarnock - an option the stewards never took seriously, and one which a further market downturn in 1979 finally obliterated) . For a year, the Coordinating Committee, uniting the seven manual and four staff unions, negotiated (with counter-arguments partly supplied by ourselves), campaigned and held fire on action for the big push, before finally acceding rather quietly to management's announcement that closure was to take place . This should not lead anyone to doubt their determination or the sincerity with which they embarked on the struggle ; nor can Masseys' case be dismissed as one where the unions were unusually ill-placed or organised . This is why it seems important to examine the conditions limiting their effectiveness and at the same time to note the nebulous and inadequate nature of many prescriptions laid down on the left to guide such struggles . Platitudes must be replaced by informed and concrete, meaningful proposals if programmes such as, for instance, the AES are to have any meaning .

Union strengths in Kilmarnock We can state these concisely : • High membership in a relatively high-wage plant . • Strong steward organisation, particularly when faced by the crisis, and one which had kept a copious dossier on Massey Ferguson activities . • A national combine committee, which



CAPITAL & CLASS

160 met regularly during 1978 and pledged support for the Kilmarnock struggle, and donated funds to the campaign . • International links . Contact with the Marquette factory in France, with several meetings with the Confederation General de Travailleurs (CGT) in London and in France, including being carried through the factory gates to address a meeting in the Marquette factory against mangement wishes . Also attendance at a Rome conference where delegates from France, Italy and Spain promised backing in general terms . • Strong political support from the Labour Party, particularly on the local council (who backed the campaign with money as well as words) and from local Labour MPs, which the campaign sought to reinforce by a Parliamentary lobby . • A sensitivity to Masseys' and multinational corporations' general tactics which informed the Co-ordinating Committee's strategy . For instance, they were aware that multinationals like Goodyear and Singers, like British Leyland at Speke, had seen management provoke industrial action immediately preceding announcement of closure and then use it to blame the workers . • The Research Team . Multinational Corporations' strengths and the constraints on labour Massey Ferguson were nonetheless able to ride the tide of union resistance and criticism, retrospectively with some ease though not without considerable expense including relatively high redundancy payments . Evidently closure situations, where union countervailing power is most urgently needed, are also ones where the methods available to labour to hamstring a multinational are at their weakest, i .e . cutting output and

holding equipment and plant from management use . Thus after almost a year of negotiations, in which national union officers took an increasing role, and after detailed exchanges in which the unions and the stewards themselves presented critiques of the company's feasibility study and the subsequent response which, we would claim, showed that study and its conclusions to be invalid even in its own stated terms, the chairman of the company (appropriately named Victor Rice) pronounced himself adjudicator and in honeyed terms regretted that the arguments for closure remained irrefutable . By this stage, the stewards felt that management had of achieved the substitutability Kilmarnock labour with labour elsewhere, and were not vulnerable to the workers' ultimate weapon . We shall argue that capital, particularly transnational capital, always has the dice loaded in its favour . It is the essence of such capital to make labour as homogeneous and substitutable as possible, to reduce it to an unproblematical resource, and its entire organisation is suffused with the logic of enforcing this . Labour, in contrast, relies on identity, consciousness, solidarity and determination, which is generated essentially in the work community ; thus multinational and even inter-plant solidarity is in certain key respects almost an alien thing . Yet it is almost a truism that only such solidarity, as tight and co-ordinated as that of capital, can hope to counter the multinationals . In our view, there is no `natural' tendency for such solidarity to emerge, though such a trend seems to be taken for granted in many pro-labour accounts . A false logic is used to derive the existence of this tendency from the process of capital internationalisation . The assumption is made that if the

STRATEGY multinational is forced into the international market through the need to control markets, control raw material and distributive sourcing, acquire access to cheap labour sources, or guarantee protection against political upheaval, then labour can undertake a similar internationalisation in its own interests . Charles Levinson of the International Chemical Workers, for instance, sees a process of wage-equalisation across the subsidiaries of multinationals leading to a reduction of inter-workforce competition, and a concomitant growth in international solidarity . We would challenge first the idea of an equalisation of wage levels across the international economy both theoretically and empirically . Secondly, and most important, the assumption made by Levinson that the objective processes of wage equalisation will lead to the development of an international trade union consciousness requires a great leap in imagination if the argument we develop about the workers' reliance on identity is correct . At Masseys the weakness of the unions' position was reinforced by the age structure of the workforce . Many of them were old and had long service with the company, so the redundancy money attracted them, and did so increasingly as the negotiations dragged on . There were also problems, familiar to students of plant organisations, of a growing distance between the knowledge of the co-ordinating committee and that of the rest of the stewards, let alone the workforce . The pressure of fighting management tended to reinforce this process, which is far more complex that just `bureaucratisation', so paradoxically undermining the level of consciousness and involvement among the workforce which is so central a resource in the struggle . By dragging things out, and by C . & C . 20-K

other strategies including what the 161 stewards themselves saw as management sabotage against the plant and the introduction of seductive management consultants, management in retrospect made full use of these weaknesses . Yet if the unions and workers by themselves lacked the clout to stop management, it might be argued that the nation State, at least in the right sort of hands, and combined with international political cooperation, could force disclosure and accountability on capital . State control of multinationals : codes of practice, fiscal measures, the AES and all that In recent years the populist answer to control of what are considered to be `socially irresponsible' acts by capital, and particularly multinationals, has been to call for forms of enforced accountability to government and workers . International bodies such as the International Labour Office, Organisation for Economic Cooperation and Development and the European Trade Union Confederation have called for codes of practice, particularly to force companies to disclose information to and bargain properly with workers' representatives . In the UK the disclosure requirements of the Employment Protection Act, and the proposal of Planning Agreements by the last Labour government sought to intensify these obligations within the country . More recently, proposals spearheaded by the AES have sought to revive and revamp these ideas . Their proposals are predicated on a leftorientated Labour Party in government with the willingness to use all available sanctions to back up the application of the requirements to multinationals and so make workable the `industrial democracy' panacea .

CAPITAL & CLASS 162

Planning Agreements and Codes of Conduct are not likely to work . We have grave doubts about the workability of either planning agreements, or the Codes of Conduct . Firstly, to make codes of conduct effective, there must exist the power to impose adherence to the codes' provisions . As the Codes are voluntary, there is little likelihood of their being used except as propaganda exercises by multinationals . Attempts to impose a required code of behaviour upon these corporations, as in the case of Andean Pact legislation, foundered on a mixture of noncompliance and inter-economy rivalry . The experience of planning agreements, upon which the AES places such stress, is likewise unpromising . The Linwood agreement is the unfortunate case which has attracted much attention, but however unfortunate it was, it raises again the problem of agreement enforcement . Furthermore, sanctions against multinationals for non-compliance with planning agreements are problematic for a British government because of the prospect of international retaliation. National British capital is floundering but international capital is thriving, and retaliatory measures against this international presence would create severe political and economic reverberations in Britain . However, it is the conceptualisation of the state which both codes and agreements invoke which initially interests us . The AES view sees the state as open to `capture' ; it may be transformed from a capitalist state by attrition through reform . Planning agreements and codes of conduct are weapons in this war of attrition, and their effective implementation becomes crucial to the success of the AES . We have already cast doubt upon their likely success, but we would fur-

ther challenge the view of the capitalist state as open to `capture' . We would argue that the state is a relation formed and embedded within capitalist production, permeating the set of economic and social relations which the AES wishes to transform . Its very nature and dependence binds it to the economic rationality of capital . It is illusory to imagine that one could change its entire logic merely by invading a control room and pulling levers with more determination than past Labour governments . In this argument, codes of conduct and planning agreements may appear to constrain the actions of capital, but in effect cannot transform the capitalist nature of the state, and, may spread false hopes that this is possible . The enforcement of rules on disclosure and negotiation This latter aspect of the weakness of AES and other proposals as they stand is not the focus of our discussion in this paper, however . We are more concerned here with the second weakness, which persists even if the State were somehow successfully `captured' . How is even a genuine requirement of disclosure and negotiation `in good faith' to be enforced? Consider Massey Ferguson's record during the build-up to closure, illustrated by : • a full presentation and supplies of copies of the study which concluded that Kilmarnock must close . • the concession, for `social responsibility', of the baler for Kilmarnock rather than the cheaper option of complete closure in the initial study . • a series of meetings to debate the decision to close, with provision of further information as requested by the unions, plus meetings with and the provision of further information to govern-

STRATEGY ment representatives . All this seems to more than fulfil negotiation requirements . Closure did not take place until February 1980, nearly a year and a half after the first announcement . • funding of a work search by a prestigious management consultancy firm, and when that failed, of a small company, Moorfield, to work on a subcontracting basis for other companies . The corporation could, we feel, present a sufficiently good case to thwart any effort to convict them before any body enforcing codes of conduct . Behind the scenes, and seen from the Kilmarnock co-ordinating committee's viewpoint, the picture looks very different, but in ways that would hardly stand up to public 'proof . The management sabotage noted earlier, the absence of any serious replies to the dissection of the feasibility study, the refusal to let the unions take part or to concede important information on unit costs (which was so well hidden that even strong links with other plants could not produce sufficient information for an independent calculation), the hollowness of the baler proposal from the start, the arguable use of the management consultants as a sophisticated flypaper with which to trap and divert co-ordinating committee efforts all attest to this . Moorfield, it seems, took on not one of the sixty or so stewards from Masseys, and now offers the company a cheap contractor with flexible working practices, low wages, and no union hindrances (though all are still union members) . Fundamentally, though, the problem is more severe than even the above suggests . In the end, Masseys will take decisions shaped by the rationality dictated by the interests of those who control it . The political economy of international capital cannot be over-

ridden merely by the willpower of 163 politicians, even if they are somehow independent of the networks of influence exerted by it . The complexity of the activities of international capital results in two types of problems arising when controls are considered . Firstly, there is the question of the internal dynamic of international capital . This is not reducible to the operation of single plants, for, as in the case of Masseys in Kilmarnock, local profitability and efficiency may have little to do with the criteria which determine international viability . The crisis in Massey Ferguson was precipitated by the demands of the banks, to which the corporation was in debt, for a display of rationalisation and closure. That Kilmarnock was still profitable and at least as efficient as Marquette did not count for the corporation in its provision of a token of good will to the banks, and it is hard to see how in a recession, and surrounded by decisions of this sort, any conceivable political effort within the system of international controls over multinationals can deflect decisions made in accordance with these international requirements . This trade-off between manufacturing and financial criteria, the one concerned with profitability related to production, the other concerned with balance sheet returns and confidence, is at the root of the international rationalisation of multinational subsidiaries which we see at present, as the need to establish confidence in company operations tends to concentrate the minds of multinational executives on the trade-off between production costs and levels of profitability . This is an international bloodletting reminiscent in conduct of the Borgias but far outdoing them in scope . It is again hard to see how codes of conduct or planning agreements can

CAPITAL & CLASS 164 staunch the flow of gore . The second set of problems highlight these inadequacies even further . It is not at all clear how existing AES proposals will facilitate the counter-posing of a political economy of labour to that of international capital . It is clear that an effective challenge to the logic of international capital must be based on an alternative ordering of production relations and criteria which place the needs of people before those of international capital . Such an alternative political economy, however we choose to define it, is unlikely to emerge from a return to Keynesianism such as the AES proposes . If, as one version of the AES has it, the alternative mode of production relations is to be based on increased productivity achieved in capitalistcontrolled enterprises under the control of labour, we cannot see how control of multinationals, industrial democracy or whatever, may be achieved . It would require an implicit assumption of compatibility and shared-gains between the two political economies . Against the priorities of international capital, and its capacity to operate with two sets of criteria at the same time (national and international, production and finance) the AES seems not merely puny ; it seems to concede almost all the interests of international capital . If this is the case, gains for labour become dependent on the goodwill of capital . Experience at Masseys and elsewhere hardly inspires faith in this .

The workers' alternative plan In discussing alternative strategies, it would seem relevant to pass some comment on one strategy not adopted by the Massey Ferguson co-ordinating committee, the workers' alternative plan .

When the research team first went into the plant, such a possibility was prominent in our thoughts . We were told, and largely convinced by the argument, that such an effort would divert the main fight to keep the combine, particularly at such a late stage when realistic alternatives offering sufficient work and technological scope would be difficult to come by . In the end, though, the committee became trapped in a much worse form of alternative plan, on management's initiative and terms . At the management consultant's suggestion they asked management if they had thought of a work search for alternative work for the plant ; management pursued the idea with startling alacrity, paying Inbucon (the consultants) for the search and pulling the committee into the joint body looking at possibilities . To us, this seemed a significant blow in absorbing the energy and willpower of resistance, though many on the coordinating committee would claim that the battle was already lost, so they could lose little more . However, a further point is worth stressing in relation to the activities of Inbucon in Masseys . Their work search was put over very much as an alternative plan with the interests of the workforce in mind . This shows the degree to which all proposals which the Left put forward as alternatives to the priorities of capital may be usurped and transformed into a vehicle for those same priorities . Whilst the need to put alternative proposals forward is clear, the danger presented by managerial absorption of workers' proposals is a constant threat . Already we hear of other eminent consultants 'capturing' the alternative products concept in the same way as Masseys . We cannot presume that without forewarning and forearming all workers will have the

STRATEGY same clarity and resistance to management infiltration as the much-lionized Lucas Aerospace stewards .

Conclusions The conclusions we have reached as a result of examining what happened at Massey Ferguson, Kilmarnock have drawn also on what we have been able to observe of other struggles with multinationals in Strathcylde and elsewhere . Indeed, the pattern of rundown and closure often displays a coherence which suggests that Masseys' tactics can be seen as part of a larger process of experimentation with strategy by international capital . Nor need the companies be foreign-owned for the rationality and effects of their action to be the same for those who depend on them for a living . It may be felt that our comments have leaned heavily towards a pessimistic depiction of the resources of the labour movement and the left, and towards pouring cold water on longawaited proposals for tackling the problems . To the extent that this is true, it is not beause we take any delight in some imagined political superiority and purity of our `line', or would deny the need for a positive initiative to rally progressive forces . It is because we believe that naive proposals may actually be counterproductive by underestimating the enemy and by tending to be optimistic . Perhaps all intractable problems become more complex as closer examination peels away the layers of diffuse socialist hopefulness . But to fail to confront these realities in their starkest form is the surest recipe for disaster . At present worker responses follow a defensive syndrome and 'tail-end' multinational initiatives in a parochial pattern that will not be transcended by rhetoric and sup-

plication to the icon of natural international labour solidarity . Can we make any positive recommendations from our work? It has not been our aim to produce neatly parcelled policy proposals, and we are deeply suspicious of such packaged programmes . They seem to treat capital as a static enemy, to be chipped away at as and when we get the right tools, not as a strategically cunning and highly adaptable aggressor . Nonetheless some general observations are possible . Firstly, there is no formula for organization and action which guarantees success against the power of multinationals . At Masseys, for example, different union tactics would have brought other company manoeuvres, and it cannot be easily concluded that other actions would have brought the workers victory . The introduction of Inbucon was one such masterly response to the workers' obduracy and organizational successes . Nevertheless, lessons can be learned from Masseys and other struggles, though applying them is another matter . Trade unions, we feel, have to recognise that traditional forms of resistance are increasingly powerless against international capital, particularly when it comes to closures . New forms of organization and struggle, not just modifications, have to be forged . On this core, we sympathise with the suspicions of the official union movement of groups of outsiders offering research support to local activists as threatening `parallel unionism' and a loss of contact with political realities . But such support is also a potentially important new resource, particularly if (unlike our own case) it takes the form of long-term work rather than so desperate and constricted a response to crises . We are presently working on an extended

165

CAPITAL & CLASS 166 evaluation of such efforts, and there are real problems to be tackled, as our own experience shows us . But part of the answer is for the union movement to cease to see such groups as `outsiders' and to encourage, shape and help their actions rather than fearing them . Conservatism will not meet the immense challenges to be faced . The same point applies more forcefully still to combine committees . To stress the point again, inter-plant and international solidarity are not `natural', they have to be constructed in the face of multinational resistance and divisive tactics, and across other formidable barriers . They are, however, indispensable . As such they require energetic support, and the coherence of a concrete action programme . Mere `links', `contacts' and

vague promises of backing count for little in the face of the raw power of capital . Finally, we have been gloomy on the because of our scepticism concerning the possibility of turning it, like a weapon indifferent to its wielder, against capital . It does seem possible to exploit nationalist interests against multinationals though, and clearly this should be used to advantage . Yet unless we are wrong, and the state can be induced to police capital as never before, rigorously controlling investment flows and wielding sanctions, prepared to face the damaging retaliation that must ensue, the impact will be marginal at best . Nothing less, and certainly nothing as woolly as the AES proposes, will do . AES

STRATEGY

a journal of the Fernand Braudel Center for the Study of Economies, Historical Systems, and Civilizations

Editor: Immanuel Wallerstein Review is committed to the pursuit of a perspective which recognizes the primacy of analysis of economies over long historical time and large space, the holism of the socio-historical process, and the transitory (heuristic) nature of theories . The contents of Volume VI (1982-83) include : Maurice Aymard

From Feudalism to Capitalism in Italy : The Case That Doesn't Fit

Giovanni Arrighi, Terence K . Hopkins & Immanuel Wallerstein

Rethinking the Concepts of Class and Status-Group in a World-System Perspective

Laszlo Makkai

Ars Historica : On Braudel

Richard Roehl

Britain and European Industrialization : Path-Finder Pursued?

Discussions on

"Eastern Europe and the World-System" "The Ancient World" "Transnational Corporations" "The Geometry of Imperialism"

Previous volumes contain articles by Anouar Abdel-Malek, Samir Amin, Giovanni Arrighi, Norman Birnbaum, Fernand Braudel, Silviu Brucan, K . N . Chaudhuri, Arghiri Emmanuel, M . I . Finley, Andre Gunder Frank, Johan Galtung, Ernest Gellner, Georges Haupt, Rodney Hilton, Eric J . Hobsbawm, Halil Inalcik, Ernest Labrousse, Frederic Lane, Emmanuel Le Roy Ladurie, Henri Lefebvre, Bernard Magubane, Sidney Mintz, Ramkrishna Mukherjee, James M . Petras, Walter Rodney, Henryk Samsonowicz, T . C . Smout, Henri H . Stahl, Tamas Szentes, Romilla Thapar, Charles Tilly, Jaime Torras, Pierre Vilar Institutions $46

SAGE

PUBLICATIONS, INC .

275 South Beverly Drive Beverly Hills, California 90212

Individuals $20 (yearly rates)

SAGE

PUBLICATIONS LTD

28 Banner Street London EC1Y 80E, England

167

`Partial Progress . The Politics of Science and Technology' by Joseph Schwartz . (Pluto Press, London, 1982 . pp.215 + viii. ISBN 08610438S5 £4.95)

Bill Schwarz

V Cooling the white heat L

`Here we are in 1964, in the middle of the great scientific revolution in world history, with science making more progress in the last fifteen years than it has in the last 1,500 years, and yet there are millions of people who have got no bath in their home, no inside lavatory, no internal hot-water system . W e saw some of these homes this morning .' No surprise that these words were spoken by Harold Wilson in the election campaign of 1964 . The title of the speech was `A First Class Nation' . Wilson's politics, especially his technocratic utilitarianism, is so thoroughly discredited that these election speeches are invoked time and again by those on the left as key instances of an uncritical faith in science taking precedence over a commitment to socialism . However it would be wrong only to see Wilson, in 1964, as the devious politician, holding up his sleeve the various jokers which he was to pull out, one by one, as his administrations slipped further and further away from anything remotely identifiable as socialism . The dominant political language of the period was steeped in the rhetoric of modernization . Under Macmillan the Conservatives attempted to appropriate this language for their own political programme . It was Macmillan who boasted (with some justification) that `I have always been a planner' ; and it was Macmillan who, in 1959, first promised a Minister of Science . What Labour achieved in 1964 - in its full flight of meritocratic idealism - was the ability to speak this language with the greater conviction .

REVIEW ARTICLE One reason for this was that Wilson, the bright young socialist statistician of the thirties tutored under the stern eye of William Beveridge, was also drawing upon what had once been a credible socialist, and even marxist, tradition which insisted upon the identity between science and socialism . The famous declaration made at Conference in 1963 is too striking to be missed : `we must harness Socialism to science and science to Socialism' . Indeed, the ideologies of technology and modernization propagated by Wilson in the early sixties were, from a longer perspective, the culmination or end-point of that socialist tradition, finally stretched into undisguised complicity with social democracy pure and simple . In no other area of intellectual life in Britain in the 1930s and the early 1940s could there be found the degree of convergence between social democrats, socialists and marxists as in the field of the natural sciences . Perhaps the most telling illustration is the Webbs's eventual adulation for the USSR . To them the Soviet Union represented the most rational and scientific of governments . `The administrators in the Moscow Kremlin genuinely believe in their professed faith ; and their professed faith is in science .' The independent intellectuals and the private organizations which created the range of `middle opinion' in the 1930s, excluded from the offices of state by the National Government but in the process of constructing the theoretical foundations of the post-war consensus politics of the centre, drew as much from the ideologies of the natural sciences as from the social sciences . The prominent natural scientists were everpresent as signatories to the proliferation of manifestos and blueprints advocating `planning' . Whether the model was Stalin or Roosevelt, the enemy was laissez-faire liberalism . Reason ; progress ; planning - all became fused into the central sign of science . Rational state planning, from above, conducted by the emergent technocratic and administrative intellectuals (the New Liberals, the Fabians, the Conservative corporatists, the Labour and trade union bureaucrats) was the key impulse in the protracted development of the managed economy in Britain. Beveridge, and Macmillan himself, are representative of those figures who struggled to construct the space, inside the state, in which such policies could be formed and pioneered . The scientists made a peculiarly privileged contribution to these new political forces . As Gary Werskey has demonstrated' a momentous intellectual organizer was the periodical Nature which was able to pull together into a single alliance the British Association for the Advancement of Science, the National Union of Scientific Workers, ICI and the Labour Party . (This, more than anything else, sounds like the prototype of the Crosland dream-world of the

Science, socialism and planning

169



CAPITAL & CLASS 170

1950s .) ICI, in fact, came to symbolize the potential of a modernizing technology dedicated to public service and the common good, an indigenous model to be emulated .

Science and the left : 1930s and 1940s

In all but one or two cases in the 1930s and 1940s progressive opinion effectively came to exclude the conservative right from a dominant position in the sciences, thereby reversing the conservative hegemony which had held since before the turn of the century . The reasons for this are complex and deserve investigation . One undoubted factor was the disintegration of the radical right as a viable political force by the early 1920s and the concomitant collapse of the virulently conservative theories of social imperialism . The case of eugenics is important here . Eugenicism and `social biology' did not disappear from the scientific discourses of the 1930s . Far from it . In mainstream psychology the quest for `mental measurement' remained predominant, constituting one of the fields most resistant to progressive infiltration : hence the significance of libertarian inputs on the margins, drawing either from psychoanalytic variants of sexology or from a humanist, child-centred pedagogy . Furthermore, elements of eugenicist theory quite easily crossed over to the progressive camp, particularly in the work of the New Liberals and Fabians . Eugenicism and its derivatives encapsulated in theoretical form the rationale for the retention and refinement of the coercive core of the institutions of the welfare state so dear to Beveridge and his cronies, to be deployed both in terms of gender (the `unfit mother') and of class (the continuing history of the `residuum') . But none the less, by the thirties eugenics had lost its hegemonic position in defining the linkages between the natural and social sciences and in focusing the political project of `science' . Alongside this a second factor can be seen in the emergence of marxism as an ideology appropriated by a significant sector of professionally trained scientific intellectuals, a process which gathered pace from the mid 1930s . To fully understand why this occured would involve an explanation of the breakdown of the `intellectual aristocracy' of the late nineteenth century and of the expansion of a waged, professional intelligentsia - a process associated with the long formative period of monopoly capitalism . The shift in the ideological disposition of scientific workers, centred on Cambridge and its institutionalization of the researchorientated `excellence' of the High Science paradigm, is thus one part of a broader process of radicalization of intellectuals in the 1930s . But this transformation needs more detailed specification,

REVIEW ARTICLE 171

particularly in relation to the form of marxism which resulted in the conjunction between the positivism of British autodidact Communism2 and Cambridge High Science . To the scientists, marxism appeared as the most rational - the most ordered and teleological - of social philosophies, a dimension which appeared all the more compelling when counterposed to the mystical `unreason' of fascism . The marxism which evolved drew most from Engels's later writings, the `laws of history' constituting a conceptual mainstay . The belief in the progressive socialization of the forces of production was central to this schema . What was at issue was how best to transfer the management of these vast new economic forces from the abuses of private capital to public, collectivist control . From this point on, the line dividing marxists from socialists or social democrats could, in many instances, become very blurred indeed, for the perspective of `reform from above' (as a passive revolution) was one which could equally follow from this variety of marxism as from a more explicitly managerialist conception of collectivist planning . After all, the model for the marxists was Stalin and the Five Year Plan . Despite the deliberate and cynical ways in which Western ideologues in the Cold War politically invested in the Lysenko debacle in 1947/48, and even though many of the foremost of the British marxist scientists trod very warily on this issue, it must still be said that Lysenkoism was one logical point of culmination of this tradition of scientistic marxism . The tendency for these theorizations, when translated into practice, to obliterate or at least diminish popular controls, `from below', was very great indeed . But one paradox of this intellectual culture was the extent to which it generated its own popular dimension . Many of the most brilliant of the scientists were prodigious and astute popularizers of their own work . The popular journalism of the period (Ritchie Calder in the Herald is the best, but not the only, example) and the range of scientific titles published by the Left Book Club and by Penguin (and Penguin Specials) are testament to the way in which progressive culture as a whole was influenced by and receptive to a radical and socialist rendering of science .

By contrast here we are, in 1983, and the picture is altogether more sinister but perhaps at the same time, more open to strategic intervention . The anodyne packaging of technology as a spectacle, as an image for mass consumption and reverence, is deeply structured in the dominant media . Yet the ideological work on which this is grounded appears to be less sure in its lines of projection . Unquestioning acceptance of the beneficence of

Socialism, Social Democracy and Science : the 1980s

CAPITAL & CLASS science is no longer lodged so securely in the commonsense of our age . Alongside Tomorrow's World and incessant media adulation of `the chip', the (current) `blockbuster film of all time' portrays the repressive qualities of a technology which underpins both the hyper-medicalization characteristic of the metropolitan nations and the growth of state authoritarianism . Again there is occuring a crisis in the hegemony of scientific ideologies . It is a cliche to assert the parallels between the 1930s and the early 1980s . However it is the case that immiseration, unemployment and militarism have returned with a vengeance which would have been unthinkable in the 1950s . But in the current crisis there have been few signs of socialists attempting to resurrect, in any straightforward way, the thirties perspectives in which science, as such, is actually presented as the solution . (Here the contrast between socialists and social democrats is marked .) The astonishing acceleration in the forces of production, which Wilson noted in his speech, still left millions of people in the 1960s without baths . What Wilson was unable to grasp, or did not wish to, were the causal connections linking massive investment in highly capitalized scientific projects to the relative pauperization of large sections of the population ; nor could he see that `more' science could only reproduce and exacerbate social inequalities unless science itself were reconstructed . The contradictions internal to the capitalist forces of production, and the social repercussions effected by their development, have continued apace . In 1982 six-and-a-half million people in Britain received supplementary benefit (and thus officially recognized as impoverished) while local high-street shops were packed to overflowing with electronic junk . This chaotic spiral of overproduction in some sectors combined with an overall decline in manufacturing production has not, however, pushed the left into that same scientistic, super-rationalistic version of planning that characterized the thirties . In part, this may be because of the experiences, over the past decades, of the statism of the social democratic experiment . Centralized, scientific planning from above - conducted and managed by the brokers of the corporate pact - has bred its own contradictions . That model of planning has come to a dead-end, terminating that easy identification of science and socialism . This rupture between socialist and scientific ideologies has also been produced as a direct consequence of the growing recognition of the appalling destructive capabilities of contemporary science . The overwhelming presence of the threat of nuclear warfare in the post-war world is of the first importance . However it is frightening but instructive to note that in Britain the initial responses to the atom bomb in August 1945, in the

REVIEW ARTICLE press most especially, systematically underemphasized its inherent barbarism - concentrating instead on the `progressive' aspects of the `new age of atomic power' . The articles in the Express - written by `the Daily Express Scientific Adviser, Chapman Pincher, B . Sc' - are very revealing in this respect . It would be interesting to know to what extent the journalistic reports were managed by the state . (The appearance of Chapman Pincher, of course, offers more than a clue!) By the autumn, Orwell was complaining : `Considering how likely we all are to be blown to pieces by it within the next five years, the atomic bomb has not roused so much discussion as might have been expected' . It was only later in the fifties, with CND, that this was reversed, and much later still that resistance to nuclear power as such developed as a significant force .

The mainstream of the socialist movement and its traditional theorists were, as a rule, slow to respond to the critiques of science which were first pursued in the counter-cultures of the late sixties (including neo-syndicalist and insurrectionary workers' groups), and later, in the feminist and ecological movements . Old certainties died hard . More particularly, those scientists on the marxist left convinced of the need to develop a thoroughgoing theoretical critique of more traditionalist scientific marxism appear to have had a curiously dislocated experience in the 1970s . I'm thinking here of those marxists working within BSSRS (the British Society for Social Responsibility in the Sciences), the group associated with the Radical Science Journal (which is now in sight of its tenth year), and - perhaps something of a throwback to earlier positions - but an institution in their own right, Professors Steven and Hilary Rose . Given what is at issue, it is astonishing that this scientific left is so tiny and so fragmented, and that until recently the problems with which they have been concerned have not been taken up more widely on the left . To one on the outside, the disputes between the various positions are simply perplexing . The debates on science have touched the CSE at a couple of points . First, the analyses of the labour process were to some degree shaped by an appraisal of the role of science in capitalist production . A number of CSE study groups were put through their paces on a regime of Andrew Ure, Charles Babbage, Frederick Taylor and Henry Ford . And for a time there existed a potentially fruitful alliance between the CSE and the Radical Science Journal in order to carry through these investigations further. Second, the positions of the antagonists and protagonists

173

Science and socialism : the links reassessed

CAPITAL & CLASS 174

within the debates on the relationship between science and marxism were hardened as a result of the impact of Althusserian Marxism - which, in its early stages reformulated a vehement distinction between science and ideology, and appeared to be regressing to an older, scientistic marxism. That this skewed some of the more fundamental questions about the nature of science and scientific development is not really to the point, for the effects on the theoretical discussions of the time registered all the same . Subsequently, Althusser in his own self-criticisms radically revised some of his major epistemological suppositions, historicizing his earlier rationalistic construction of the problem of `knowledge' and `science' . Even those marxisant theoreticians originally swept up in the original onrush of the Althusserian tide, and who eventually raised the stakes by `moving beyond' the constraints of what was seen as a formal epistemology settling on the more open-ended conceptualizations of Foucault - came to rest at the problem of the `conditions of existence of a truth', shifting from any simple rationalism . Both of these endeavours represent a more critical attitude towards an orthodox conception of science than had been common in their marxist or marxisant predecessors' . The debate on science and marxism now has more substantial ground to work on . Partial Progress . The Politics of Science and Technology by David Albury and Joseph Schwartz is the first comprehensive marxist critique of science to have appeared for years . It is a thoughtful, well-argued, well-written book . It explains difficult matters - recent investigations in the natural sciences and so on - with fluency and ease . The book also represents an attempt to break through the narrow confines and introspection of the radical science movement and to address a broader readership . In this respect, the Pluto imprint carries its usual connotations, suggesting an agitational rather than an academic intervention . `It is not intended to be the last word on the subject but an analysis which people may find useful in understanding and challenging the impact of science and technology in their daily lives' (p .vii) . Thus the authors strived as best they could not to write a text for their peers . They have, however, been active over the past decade in the theoretical and practical work of the radical science groupings - it's hard to find a project in which at least one of them has not been active . In relation to the internal configuration of the current scientific left, their theoretical positions are hard to determine . All the groups share, to at least some degree, the belief that science is `socially constructed' . But it appears precisely to be the question of degree which is so divisive . In this, so far as I see it, the Albury/Schwartz position is wary of both the orthodoxy of the Roses and of the

REVIEW ARTICLE 175

libertarianism often associated with the Radical Science Journal . The temptation to have written a book to justify their position to these adversaries inside the radical science movement must have been great indeed . As it is, the authors have gambled on reaching a wider audience : who exactly will constitute this readership is perhaps the most important question of all . And although I perhaps feel less sanguine than the authors, they were right to take the gamble . There is a a short introduction in which the authors state polemically their case, starting from a critique of popular conceptions of science and scientists . `For too long science and technology have awed and mystified the general public' (p .1) . Here, fundamentally, they insist upon the historical and social determinations which construct scientific theories and technologies . Above all, they argue, science is determined by class . This proposition, overturning the commonsense of the 1930s scientific left, delineates the conceptual drive of the book . I guess that if readers were convinced of this by the end of the book, the authors would be content .

In chapter one Albury and Schwartz get off to a cracking start with a brilliant, spell-binding account of the development of the Davy miner's safety lamp, demolishing once and for all the liberal image of Sir Humphrey Davy (one-time president of the Royal Society) as the philanthropic, benevolent inventor, bringing the fruits of a disinterested science to the people in order to secure their well-being . The strength of their argument depends not only on their theoretical orientation but on some fine historical research . From this they demonstrate : 'Davy's brief was rigidly defined . He spoke to no miners . He was told - and he believed that the problem was not one of ventilation . His brief, in short, was the owners' brief - to build a lamp that would work in the methane-rich atmospheres that existed in crept workings . It was not to investigate mine safety but to design a lamp' (p .19) . Their argument on this score is undoubtedly convincing, and thus from early on they establish the existence of a set of connections between capitalist production and science . But from this point on, my quizzical murmurings began to accumulate, and as the authors sprinted on, gracefully striding across the hurdles one by one (relativity, DNA, microprocessors and so on) I found I was lagging behind, a little breathless . Basically the problem was this : having shown how historically specific social relations - capitalist relations in particular organize the development of technology, they then conclude that the problem is capitalist (later reformulated as capitalist-

The social construction of science

CAPITAL & CLASS patriarchal-racist) science . This shift from the particular to the general, from the concrete to the abstract, is more of an olympic high-jump - except we never see the authors actually making the jump : they always appear just on the other side of the bar, performing a neat, triumphant pirouette . If science is simply the instrument of capital - as some of the more compressed, functionalist formulations in the book suggest - then it needs to be `smashed' and replaced with something like a socialist (or communist) science ; if, on the other hand, science is the resultant of a series of antagonistic social relations, the site and product of struggle, then the reconstruction of science - such that it really does satisfy human needs - becomes a much more complex project . One of the difficulties of the book is that both these conceptual approaches are employed . Whether this is due to the project of producing a concise, popular text or not, I don't know . It may suggest, however, that the authors are a good deal more sophisticated, conceptually, than some of the formulations would indicate .

Capitalist science?

There are moments in the book when a science is designated capitalist either because it was formed in a capitalist society, or, more directly, because it is the immediate product of capitalist social relations - of the capitalist enterprise . The first alternative I see really only as a terminological solution. On the face of it, the second is a more convincing argument . It doesn't take too much to persuade me that the assembly-line is a technological embodiment of capitalist social relations and that in existing form it could have no place in a socialist society . (In fact this proposition raises some tricky theoretical questions - I'm thinking, for example, of the Fiat assembly plant in Togliattigrad in the USSR and of the ways of theorizing the combination of forces and relations of production in `actually existing socialist' societies . This can be resolved neither by moralistic outrage, nor by seeing the assembly-line as the direct function of advanced capitalist social relations, nor by an explanation which focusses exclusively on the origins of a particular technology . Rather it seems to me a question of the class relations which are reproduced when the assembly-line is set in motion) . But queries still arise . The example of microelectronics seems less easily resolved . `Microelectronic automation, as we will see, is part of an economic strategy devised to resolve the crisis in favour of the multinational corporations' (p .5) . This they demonstrate with precision . They also offer a fascinating account of the origins of microelectronics, showing that the main impetus for its development came from the us military establishment . Later on, however, they claim that

REVIEW ARTICLE `a computer is nothing more than a glorified adding machine' (p .129), ultimately dependent on the human labour which constructs the programme . Thus it would seem from this example that the technology itself is relatively neutral and could easily, in different social conditions, fulfill real social needs . This makes the whole issue rather more problematic . To my mind, a more open, empirical methodology would be helpful in unscrambling some of these complexities . At times the authors adopt a more historically sensitive, struggle-orientated standpoint, particularly in their discussion of health and safety where their analysis parallels Marx's in Capital on the struggles over the length of the working day . However it would seem from further passages that this perspective is tied to a more general historical argument . Thus they say : `Our main point is that in periods of great social turmoil, when classes compete against each other for power and control, the purposes, methods and problems of science are arenas for class struggle - and can clearly be seen as such' (p .76) . This statement appears in the context of an overview of the scientific revolution of the seventeenth century . But why should science be a site of struggle and contestation only in periods of revolutionary upheaval? A clue is given in the introduction : `But in contrast to the nineteenth century, when a machine-based manufacturing economy was developing and overtaking three hundred years of mercantile capitalist agriculture and manufacture, much of the twentieth century has witnessed stagnation, world war and decay . In the present economic climate of crisis, we shall argue, new science and technology can only reflect decline and desperation rather than the growth and optimism of the previous century' . This thesis is reminiscent of the leninist interpretation of imperialism as an epoch of inevitable decay and parasitism, the `highest stage' of capitalism . In the Albury/Schwartz version the technologies and sciences produced in this era of capitalism are `fundamentally corrupt' (p .5) It is paradoxical that this reading is as teleological as the marxist positions current in the thirties .

Behind these formulations lies the hidden hand of that wily old marxist theoretician, Lukacs . This should not be of any great surprise for it was Lukacs who more than anyone else developed single-handed within marxism the critique of science, and as such is a necessary reference point . David Albury and Joseph Schwartz, of course, do not swallow this position wholesale . There is one immediate, and striking, contrast . Whereas they put themselves `among those who find the achievements of science and technology beautiful and thrilling' (p .171) Lukacs adopted C . & C . 20-L

177

Science and ideology

CAPITAL & CLASS 178

an altogether stricter line : `I have never succumbed to the error that I have often noticed in workers and petty bourgeois intellectuals who despite everything could never free themselves entirely from their awe of the capitalist world' . My heart warmed to Albury and Schwartz when I read that - not because their admission detracts from the vehemence of their critique, but rather the reverse : it makes more credible their sense of the contemporary degradation of science and technology . They take from Lukacs the recognition of science as a form of human labour (pp .79 and 164) and as such an endeavour open to the same possibilities, constraints and social pressures as any other form of human activity in class societies . This not only `puts science back' into history but recognizes the human subject as the active constituent in the production of science . It follows from this, ideally, that science should be a self-reflective activity, consciously and explicitly . They can conclude that science in capitalist formations is ideology and can be the product of false consciousness, although they are careful to insist that `false' does not necessarily mean `wrong' in the sense of error : the falsity is a function of the necessarily partial viewpoint common to all social individuals . What remains unclear is what possibilities exist in present societies for a `more true' or `less false' understanding of the natural and social world . Nor is it clear to what extent they carry into their theoretical framework the conceptual slippage which ran through History and Class Consciousness in which (in modern capitalism) objectification of human activity necessarily comes to mean fetishization . Indeed, in their appropriation of the concept of false consciousness, it looks as if they come to adopt a more militantly relativist epistemology than Lukacs . ('In this approach, "false consciousness" occurs when one social group expresses the ideology (partial view) of another with whom they are in conflict', p .70) Logically, this would mean that if socialism were the ideology of the working class, then people from the dominant classes who espoused socialism would also be in a a position of false consciousness . All this I find confusing . It's not just because of my inherent distrust of notions of false consciousness, and my dislike of the traditions from which they come . Not is it a question of asking for a fully theorized and rigorous elaboration . People reading the book will want some (pragmatic or practical) guarantees which provide a safety-net from absolute relativism, which will give some theoretical justification to the positions put forward by the authors . It's a pity that these weren't more developed, even if only in a practical state . A number of further difficulties follow from this general theoretical perspective which could be usefully elaborated . First,

REVIEW ARTICLE 179

there is the question of working from an undifferentiated notion of `science' - derivative, perhaps, from a general concept of human labour or praxis . In current discussions, for example, the rubric of science can include such diverse intellectual traditions as Taylorist scientific management and Freudian psychoanalysis . To my mind, even though it may be possible to argue that all such systems of thought are `partial', or touched by some structure homologous to commodity fetishism, it is as much the disaggregated forms which are significant .

The second point, which follows from this, is that the predominant categorization of science is one which is closely shaped by the notion of science in production . Thus their empirical and concrete studies of the development of particular sciences are unfailingly of interest : but this is partly because of the overbearing logic of their argument which concentrates on the relations between a science and the imperatives of capitalist production . When they move to more generalized explanations I feel less persuaded . Critical in this respect is the lack of attention they pay to state formation, to the state as an organizer and producer of 'knowledges' . Since 1915 in Britain - when the Committee for Science and Industrial Research was founded as a permanent institution - there have existed specific state apparatuses to coordinate science, research and development . The degree to which the state is actually constitutive of scientific knowledge should not be underestimated . The political effects of this are important . Two illustrations can be given, one historical and one contemporary . At the end of the last century, a number of new subjectivities were cast - the prostitute, the homosexual, the unemployed man, the hooligan and so on . These new ways of identifying and categorizing individuals, as politico-cultural strategies, were deeply rooted in the scientific discourses of the day . Medical science was decisive, but so too were psychology and various strands of `social darwinism' . And in each case, the state acted as the means by which these disparate knowledges were given shape and reconstituted, and thus became politically operative . Most famous are the struggles around the Contagious Diseases Acts . A number of political forces - the army, the police, the clergy, the medical profession - cohered around a particular, scientistic understanding of human nature, and achieved organizational unity through the state . In strict terms, the capital-labour relation has little explanatory power in highlighting the specific forms and effects of the medical and scientific discourse . The relations between science and capital, in this case, become politically - and theoretically - inordinately more

Science and the state



CAPITAL & CLASS 180

complex . Or to take the contemporary illustration : women at Greenham Common demonstrating against Cruise missiles . Here a revolutionary political force confronts the state . Certainly we can't understand the full import of this without seeing the connections between huge capital investment and the Dr Strangeloves . But this cannot explain the political determinations of `science' - nor the wrath of its enemies . In consequence, a number of outstanding questions remain about the central thesis of the book . Most of all, the question is this . David Albury and Joseph Schwartz are severe in their critique of orthodox socialist and marxist conceptions of science . Most of what they say I find convincing . What still needs to be resolved - but I can see that this was not the job to be done in this book - is the question of the place of classical marxism in the analysis of science . To read the Manifesto or Capital, let alone some of Engels's later and more positivist writings, confirms for me that marxism, in its very formation, was tainted by the natural science paradigm - the triumphalism of mid-nineteenth century scientism - which the authors so convincingly criticize . If science is to be reconstructed, it seems to me that marxism itself must be subject to the same process of critique . Today there exist indications of what this reappraisal might look like . The most radical example appears in the work of Rudolph Bahro who starts from the same conceptual tradition as Albury and Schwartz, but who consistently works upon that theoretical reflexivity which seems to be so all-important in a fully social analysis of science . It is critical to ask, then, where exactly the marxist critique of science is going to take us . Many of the questions I want to ask of David Albury and Joseph Schwartz are of a decidedly `academic' nature - although I don't believe that this means they aren't at the same time of political relevance . I don't apologize for this . Their's is a book which is undoubtedly important for the readership of Capital and Class . Of course, many questions remain . But it is a good book to have written .

Gary Werskey, The Visible College (Allen Lane, 1978) . Notes i . Stuart Macintyre, A Proletarian Science . Marxism in Britain, 2. 1917-1933 (Cambridge University Press, 1980) . For a judicious and informative reappraisal of this whole episode, 3. see Jonathan Ree, `The Anti-Althusser Bandwagon', Radical Science Journal 11 (1981) .



Index

CAPITAL AND CLASS Spring 1980- Winter 1982 (Issues 10-19) Articles Anthias, Floya

Women, and the Reserve Army of Labour : A Critique of Veronica Beechey

cc 10 Spring '80

Ball, Michael

Housing Provision and the Economic Crisis

cc 17 Summer '82

Barker, Jane & Hazel Downing

Word Processing and the Transformation of the Patriarchal Relations of Control in the Office

cc 10 Spring '80

The `Family Wage' : Some Problems for Socialists and Feminists

cc 11 Summer '80

Science and Technology in Restructuring

cc 18 Winter '82

On Amin's Model of Autocentric Accumulation

cc 11 Summer '80

Organisation Debate : Working Class Organisation and the Importance of Cultural Struggle : A Critique of James Wickham

cc 10 Spring '80

Barrett, Michele & Mary McKintosh Blackburn, Phil, Ken Green & Sonia Liff Brewer, A .A . Burns, Rob & Wilfred van der Wijl Carpenter, Mick

CSE

Left Orthodoxy and the Politics of Health

cc 11 Summer '80

Cartelier, Lysiane

The State and Wage Labour

cc 18 Winter '82

Coriot, Benjamin

The Restructuring of the Assembly Line : A New `Economy of Time and Control'

cc 11 Summer '80

Cressey, Peter & John Macdonald

Voting for Ford : Industrial Democracy and the Control of Labour

cc 11 Summer '80

sex & class group

Sex and Class

cc 16 Spring '82

On the Obsolescence of the Marxian Theory of Value : A Critical Review

cc 17 Summer '82

Droucopoulos, Vassilis

The Non-American Challenge : A Report on the Size and Growth of the World's Largest Firms

cc 14 Summer '81

Duncan, Mike

The Information Technology Industry in 1981

cc 17 Summer '82

Eatwell, John

On the Theoretical Consistency of the Theories of Surplus Value : A Comment on Savran

cc 10 Spring '80

De Vroey, Michel

181



CAPITAL & CLASS 182 Reconstructing Value-Form Analysis

cc 13 Spring '81

The Brandt Report : A Programme for Survival?

cc 16 Spring '82

Behind the News : Nationalism and Class Struggle in Zimbabwe

cc 11 Summer '80

Trade Unions and the State in South Africa : The Question of Legality

cc 15 Autumn '81

Local Politics and Local Government

cc 13 Spring '81

Behind the N ews: The 1982 Budget

cc 17 Summer '82

Socialist GLC in Capitalist Britain?

cc 18 Winter '82

Restructuring in West European Industry

cc 19 Spring '83

Hargreaves Heap, Shaun

World Profitability Crisis in the 1970s : Some Empirical Evidence

cc 12 Winter '80

Hargreaves Heap, Shaun

Response

cc 14 Summer '81

Industry, Women and Working Class politics in the West of Ireland

cc 19 Spring '83

Socialist Economic Strategy : A Reply to Donald Swartz

cc 16 Spring '82

Behind the News : Cable Technology

cc 19 Spring '83

Humphrey, John

Labour Use and Labour Control in the Brazilian Automobile Industry

cc 12 Winter '80

Hyman, Richard & Tony Elger

Job Controls, the Employers' Offensive and Alternative Strategies

cc 15 Autumn '81

Capitalism and Gold

cc 14 Summer '81

Eldred, Michael & Marnie Hanlon Elson, Diane Fine, Bob Fine, Bob, Francine de Clerq & Duncan Innes Flynn, Tosh Gamble, Andrew Economic Policy Group Grahl, John

GLC

Harris, Lorelei Hodgson, Geoff Hughes, Patrick & Neil McCartney

Innes, Duncan

Index to CSE Bulletin 1971-1976 and Capital and Class Spring 1976 - Winter 1979 (Issues 1-9)

James, Winston

cc 10 Spring '80

Interview with Tony Benn

cc 17 Summer '82

The Decline and Fall of Michael Manley : Jamaica 1972-80

cc 19 Spring '83

Kaluzynska, Eve Getting it Write

cc 18 Winter '82

Kiyoshi, Yamamoto

`Mass Demonstration' Movements in Japan in the Period of Postwar Crisis

cc 12 Winter '80

Lindsey, J .K .

Comment on S .H . Heap : `World Profitability Crisis in the 1970s : Some Empirical Evidence'

cc 14 Summer '81



INDEX 183 Behind the News : Poland's New Working Class Movement

cc 13 Spring '81

MacKenzie, Donald

Notes on the Science and Social Relations Debate

cc 14 Summer'81

MacKenzie, Donald

Militarism and Socialist Theory

cc 19 Spring '83

Mantegna, Guido & Maria Moraes

A Critique of Brazilian Political Economy

cc 10 Spring '80

Manwaring, Tony

Labour Productivity and the Crisis at Behind the Rhetoric

cc 14 Summer '81

Macdonald, Oliver

BSc :

The Conflict in Northern Ireland : Marxist Interpretations

Cc 18 Winter '82

On the Logical Consistency of Sraffa's Economic Theory

cc 10 Spring '80

Minns, Richard

A Comment on `Finance Capital and the Crisis in Britain'

cc 14 Summer '81

Mohun, Simon

Behind the News : The Trans-Atlantic Economic Disaster

cc 18 Winter '82

Barriers to the Further Development of Capitalism in Tanzania : The Case of Tobacco

cc 15 Autumn '81

The Decentralisation of Production : The Decline of the Mass-Collective Worker?

cc 19 Spring '83

Nakase, Toshikazu

Some Characteristics of Japanese type Multinational Enterprises Today

cc 13 Spring '83

O'Dowd, Liam, Bill Rolston & Mike Tomlinson

From Labour to the Tories : The Ideology of Containment in Northern Ireland

cc 18 Winter '82

Olle, Werner, Schoeller, Wolfgang

Direct Investment and Monopoly Theories of Imperialism

cc 16 Spring '82

Finance Capital and the Crisis in Britain

cc 11 Summer '80

The State and the Future of Socialism

cc 11 Summer '80

Interview with Toni Negri, November 1980

cc 13 Spring '81

Behind the News : El Salvador

cc 15 Autumn '81

Education for Emancipation : The Movement for Independent Working Class Education 1908-1928

cc 10 Spring '80

A Short History of the CSE

cc 10 Spring '80

Defeat at Fiat

CC

Martin, John McLachan, H .V ., A .T . O'Donnell & J .K . Swales

Mueller, Suzanne

Murray, Fergus

Overbeek, Hank Panitch, Leo Partridge, Hilary Pearce, Jenny Phillips, Anne & Tim Putnam Radice, Hugo Revelli, Marco

16 Spring '82



CAPITAL & CLASS

Savran, Sungur

Debate : On Confusions Concerning Sraffa (and Marx)

cc 12 Winter '80

Schiffer, Jonathan

Debate : A Brief Note on Soviet Economics

cc 12 Winter '80

Theories of Competition and Monopoly

cc 18 Winter '82

Behind the N ews : The New Cold War

cc 12 Winter '80

Semmler, Willi Smith, Dan & Ron Smith

Aspects of Militarism

cc 19 Spring '83

Spence, Martin

Smith, Ron

Nuclear Capital

cc 16 Spring '82

Stafford, Anne

Learning not to Labour

cc 15 Autumn '81

Swartz, Donald

The Eclipse of Politics : The Alternative cc 13 Spring '81 Economic Strategy as a Socialist Strategy

Tomlinson, Jim

British Politics and Cooperatives cc 12 Winter '80

Warrington, Ronnie Weeks, John

Review Articles Binns, Peter Bradby, Barbara

Standing Pashukanis on his Head

cc 12 Winter '80

Equilibrium, Uneven Development and the Tendency of the Rate of Profit to Fall

cc 16 Spring '82

Law and Marxism

cc 10 Spring '80

The Remystification of Value

cc 17 Summer '82

Clarke, Simon

The Value of Value : Rereading Capital

cc 10 Spring '80

Coakley, Jerry

Hilferding : Finance Capital

cc 17 Summer '82

Driver, Ciaron

Aglietta `A Theory of Capitalist Regulation : The us Experience

cc 15 Autumn '81

Driver, Ciaron

Morgan & Purdie, `Ireland : Divided Nation, Divided Class' and Bew, Gibbon & Paterson, `The State in Northern Ireland 1921-1972'

cc 14 Summer '81

Andrew Glyn and John Harrison, `The British Economic Disaster'

cc 13 Spring '81

The Political Economy of Military Expenditure

cc 19 Spring '83

Lovell, Terry

Why Cultural Studies Matter

cc 16 Spring '82

Lumley, Bob

Working Class Autonomy and the Crisis : Italian Marxist Texts of the Theory and Practice of a Class Movement, 1964-1979

cc 12 Winter '80

Barrett, `Women's Oppression Today : Some Problems in Marxist Feminist Analysis'

cc 14 Summer '81

Response to Binns on `Marxism and Materialism'

cc 12 Winter '80

Fine, Ben Georgiou, George

Phillips, Anne Ruben, David-Hillel

INDEX 185 Schwarz, Bill Wajcman, Judy

`Conservatism and Class Struggle, Politics in Industrial Society?'

cc 12 Winter '80

Working Women

cc 18 Winter '82

Williams, Mike The London CSE Group, `The AES : A Labour Movement Response to the Economic Crisis'

cc 14 Summer '81

Williams, Mike

cc 12 Winter '80

Bob Rowthorn, `Capitalism, Conflict and Inflation : Essays in Political Economy'

Reviews (reviewer's name in brackets) Basset, Keith Housing and Residential Structures : & John Short Alternative Approaches (Michael Ball) Bloomfield, Jon (Mark Harrison)

cc 13 Spring '81

Passive Revolution : Politics and the Czechoslovakian Working Class 1945-1948

cc 12 Winter '80

Industry and the State in Latin America

cc 14 Summer '81

Working Class Culture : Studies in History and Theory

cc 14 Summer'81

The Woodcarvers of HongKong : Craft Production in the World Capitalist Periphery

cc 14 Summer '81

Housing for People or Profit?

cc 13 Spring '81

(Bob Lumley)

Readers Letters to Lotta Continua

cc 14 Summer '81

Doyal, Lesley with Imogen Pennell (Mick Carpenter)

The Political Economy of Health

cc 12 Winter '80

Contested Terrain : The Transformation of the Workplace in the Twentieth Century

cc 14 Summer '81

Workers' Councils in Czechoslovakia 1968-1%9

cc 12 Winter '80

From Peasant to Proletarian : Capitalist Development and Agrarian Transition

cc 17 Summer '82

Out of the Ghetto : My Youth in the East End, Communism and Fascism 1913-1939

cc 10 Spring '80

Women and Trade Unions

cc I 1 Summer '80

Carriere, Jean (Ronaldo Munck) Clarke, John, Chas Critcher & Richard Johnson (Howard Home) Cooper, Eugene (Colin Filer) Cowley, John (Michael Ball)

Edwards, Richard (Theo Nichols) Fisera, Vladimir (John Solomos) Goodman, David & Michael Redcliff (Robin Cohen) Jacobs, Joe (Norman Ginsburg) Lewenhak, Sheila (Sally Alexander)



CAPITAL & CLASS 186 London Edinburgh Weekend Return Group (Peter Fairbrother)

In and Against the State

cc 11 Summer '80

Merrett, Stephen (Michael Ball)

State Housing in Britain

cc 13 Spring '81

Pension Funds and British Capitalism

cc 16 Spring '82

Minns, Richard (Hugo Radice)

Northern Ireland : Between Civil Rights and O'Dowd, Liam, Bill Rolston Civil War & Mike Tomlinson (Richard Chessum)

cc 16 Spring '82

Piratin, Phil (Norman Ginsburg)

Our Flag Stays Red

cc 10 Spring '80

Piven, Frances Fox & Richard A Cloward (Geoff Rayner)

Poor People's Movements : Why they Succeed and How they Fail

cc 11 Summer '80

Report of a Committee chaired by J .C . Meade, Institute of Fiscal Studies (f im Tomlinson)

The Structure and Reform of Direct Taxation

cc 10 Spring '80

Rowbotham, Sheila, Lynne Segal & Hilary Wainwright (Veronica Beechey)

Beyond the Fragments

cc 10 Spring '82

Sohn-Rethel, Alfred (Claudia von Braunmuhe)

Economy and Class Structure of German Fascism

cc 11 Summer '80

Solden, Norbert C . (Sally Alexander)

Women in British Trade Unions : 1874-1976

cc 11 Summer '80

Widgery, David (Mick Carpenter)

Health in Danger : The Crisis in the National Health Service

cc 12 Winter '80

Books received P .P . Prol, Political History of the Proletariat: Democracy versus Workers' Power, Vol . I, Germany : Unification to Weimar, Cobi Press 1982 . R. Kemp, Conflict generation and avoidance : contradictions in the development of civil nuclear power in Britain, Bristol Polytechnic Town & Country Planning Working Paper No . I, 1982 . Cherryl Walker, Women and Resistance in South Africa, Onyx Press, 1983 Charles Docherty, Steel and Steelworkers: The sons of Vulcan, Heinemann Educational Books, 1983 . Mihailo Markovic, Democratic Socialism : Theory and Practice, Harvester Press, 1982 Alec Nove, The Economics of Feasible Socialism, George Allen & Unwin, 1983 . Wladimir Andreff, Les Multinationales hors la Crise Editions le Sycomore, Paris 1982 . Review : A Journal of the Fernand Braudel Center for the Study of Economics, Historical Systems, and Civilizations, Sage Publications . Alex Callinicos, The Revolutionary Ideas of Marx, Bookmarks, 1983 . Ken Cole, John Cameron, Chris Edwards, Why Economists Disagree: The Political Economy of Economics, Longman . 1983 . R . Hudson, J . R . Lewis (eds), Regional Planning in Europe, Pion, 1982 . Manfred Bienefeld and Martin Godfrey (eds), The Struggle for Development: National strategies in an international context, John Wiley 1982 . Lynne Segal (ed), What is to be done about the family? Series : Crisis in the Eighties, Penguin 1983 . Elizabeth Wilson, What is to be done about violence against women? Series : Crisis in the Eighties, Penguin, 1983 . Carmen Sirianni, Workers Control and Socialist Democracy, The Soviet Experience, Verso, 1982 .

187



188

CSE MEMBERSHIP 25 HORSELL ROAD, LONDON N5 CAPITAL AND CLASS Please start/continue my subscription from number I enclose : UK Overseas £7 .50 £8.50 Full Reduced £5 .00 £5.00 (student, unemployed) £20 .00 Supporting £20.00 £20.00 Airmail HEAD AND HAND I would like to subscribe for 3 issues from current/next issue . I enclose: O UK £2.50 0 Overseas £3 .00 0 Institutions £4.00 C&C BACK ISSUES : Please send the following issues O Numbers 4-8 (£1 .50 each or 3 for £4.00) O Numbers 9, 11, 12 (2 .50 each) El Number 10 (£2 .00 each) O Number 13 and subsequent issues - (£l .80 each) Cheques: Payable to CSE Membership and kept separate from CSE Books . Non-sterling cheques: Please add bank clearance charge of £ 1.00. In all correspondence, including subscription renewal, please quote reference number from address label . Change of address : I have changed my address from

Name

Address

Please complete: Job Subject Instit ution Area

1 2 3 4 5