Keynes vs Marx on Idealism and Materialism

 

The NZ Labour Party hanging onto the coat-tails of dying capitalism will end up in the same graveyard of “progressive hopes”. Fortunately, before that happens workers will reach peak idealism and awaken to dialectical materialism. But such is its hold on our minds, idealism is not spontaneously replaced by the materialist world view we need to make the transition from capitalism to socialism. 

Without a class conscious revolutionary leadership to warn them and point the way, workers will fall for anti-scientific conspiracy theories of power elites manipulating their lives. Without the antidote to idealism, workers fall prey to demagogues of left and right instead of uniting and organizing to fight for survival socialism.

Idealism is the doctrine that thought creates being, rather than as Marx put it, that being determines consciousness. Being is our material, biological and productive life. Life begins with material needs not the ideas we use to measure it. 

So if our basic needs (jobs, health, housing, education etc) are not met and we face poverty, racism, sexism etc., the bourgeoisie blames this on ‘human nature’ the source of all ideas next to God. 

Keynes, master of distributional economics based on the ‘animal spirits’ of capitalists, was an arch idealist. On the face of it he was a practical economist. But for him capitalism was motivated by ideas. When capitalists failed to invest because they calculated they would not get a sufficient profit, Keynes had a bright idea; use the state to boost wages and demand (the multiplier) and stimulate  capitalists to invest in supplying that demand.

Yet this idea fell flat because despite increased demand, the capitalists hoarded their money rather than invest in production, or gambled on existing values, and the result was inflation as the increased money supply chased too few goods and services. Marxists at the time explained why this happened. Capitalism was subject to the Law of the Tendency of the Rate of Profit to Fall (LTRPF) and that required the supply side (inputs of labour and raw materials) to be cut in price to restore an average rate of profit.

In other words all attempts to tweek the markets will fail if the conditions necessary to restore profits are not satisfied. All neo-Keynesian ideas like Modern Monetary Theory and Donut Economics suffer from the same defect as Keynes basic idea. If the costs of inputs are not cut sufficiently to return a profit, capitalism will stagnate and enter a slump.

So, state ‘interference’ in the market is idealist because the material conditions required for the production of profits demand greater state attacks on workers living standards, and on nature to drive down costs the of production.

In Aotearoa today, peak idealism will be reached when workers no longer believe that the Labour government (or any capitalist government) can rescue society and humanity from the destruction of nature. The last hopes of a system reboot to avoid its self-destruction will be overtaken by the looming apocalypse of climate change, pandemics, economic crash and political tyranny.

Yet what is the response to the failure of such defunct ideas? Mostly a shift to supposedly 'new' or 'better' ideas that still remain trapped in idealism. The failure of the system is still seen as the failure of ideas, usually the ideas of influential individuals who create social movements dedicated to the delusion that a radical rebooting of capitalism will save us all.

That is why we are served up a mad menu of vulgar theories and conspiracies, invoking the ideas of self promoting gurus and their corporate backers who resist peak idealism with even more extreme post-modern forms that deny the biological and sociological reality of the material world. Scientific truth as a collective struggle for knowledge becomes a relativism where the free individual can escape external forces and realise his or her or their personal truth.

Bourgeois fetishism now escapes the normal institutions of academia, journalism, history and law, and become hypomanic denials of reality such as QAnon where elites rape children, antivaxxers in denial of coronovirus, or trans ideology that reduces biological sex to idealist feelings about being ‘born in the wrong body’.   

Once ideas become detached from material reality, notions of growth and personality become detached from biology, science and nature. Debates exist in an otherworldly vacuum of religious belief without roots to the earth. It’s one thing to reject these as false, it’s another to know what causes them. The critique of such forms of idealism today has to start at the beginning by grasping Marx’s critique of idealism.

Even before class society emerged (before there was sufficient surplus to enable it) social production was the result of material need not ideas. Ideas served only to organise the collective struggle for biological and social reproduction. The kinship group had a classless relation to production developing the tools to harness nature's human and non-human energy.

Once that development produced a surplus, ideas then turned to conserving the labour time of the few at the expense of the many. The ruling class had the ruling ideas about labour time. Work and die. The shaman and warlord was born to impose those ruling ideas within the class system.

After this gigantic leap, class societies went from exploiting the labour of slaves, to that of peasants and then wage workers, articulating all three! The ruling minority imposed its ideas on the working majority. Those who became the rulers justified their wealth in the name of gods, projecting their class power onto the gods in interest of the community.

The capitalist system is not an aberration, it follows this historic law - the ruling ideas are the ideas of the ruling class. The capitalist ruling class has the advantage over previous ones in that it doesn't need gods. Capitalism itself produces its own ideology in the very process of production where the act of exploitation of labour-power to produce surplus-labour and profit appears to be ‘natural’ and ‘just’. If we are all individuals buying and selling commodities, including labour-power, at their value then the worker who sells his/her labour power at its value is no different to the capitalist who buys it.

For Marx the ideology of capital is the idealist fetish of value created by market exchange rather than production. As a result we are alienated from production and trapped in the fetishism of exchange.

The production of labour value is separated from the ‘being’ of wage-labour and magically becomes the 'ideal' effect of supply and demand. Therefore, the failure of the market to create equal and free individuals appears to be caused by unequal exchange of commodities rather than the exploitative relations of production.

Unequal exchange results from monopoly power forcing down the price of the commodity below its value. Naturally capitalists always blame workers for this disruption. Marx demolished this illusion,  proving that labour-power was the only commodity that produced more value than its own value - hence the secret of profit extracted at the point of production, not its fetish in the market.

If the ruling idea of capitalism is the ideology that the system is natural and perfect, and this breaks down when the market malfunctions, it still leads to  attempts to reform the market from Proudhon to Piketty, and every shade of Labourism and Democratic Socialism.

So, Marx's discovery of the commodity labour-power (a child's discovery said Marx) proves that capitalism as a system never was intended to benefit all, but to justify in the name of all, poverty for the producers and wealth for the ruling class.

Once he made that discovery Marx had the key to unravel the apparent complexity of capitalism as a living reality determined by laws of motion that would lead necessarily to its eventual demise as it destroyed its material base in nature. 

But there is no need to surrender to fatalism. Knowledge provides an escape route from the alienated fetishism of life under capitalism which sucks us into futile identity politics. No longer are we isolated individuals but part of a social class where our collective knowledge becomes that basis of our capacity to act and change society.

The understanding of Marx’s scientific method creates the opportunity for workers to become class conscious and organise the power of the producers to end the long history of class society and embark on building the classless society - communism.

 

 

NZ: Labour fails 100 Days in Government Test

Shaw, Ardern and Peters, the different faces of the Caring Capitalism popular front

We take a look at the promises from the Labour party when campaigning and on taking office – what will these really deliver for working people? As we argued in previous issues of Class Struggle, Labour forming a Coalition with openly capitalist parties means it cannot claim anymore to be a party that represents workers. It has an excuse to betray its working-class voters by trading any real gains for workers in exchange for becoming the government. 

That is why our balance sheet of wins and losses for workers in the first 100 days is boringly predictable. Once Labour signed the fiscal responsibility deal with the Greens it meant it can’t even adopt Keynesian spending to stimulate economic growth (boost profits) let alone spend on what workers need (living wages). 

And to win Peters to form a government, Labour and Greens had to trade away some of its promises to appease his populist, conservative supporters.The result is that Labour now openly betrays workers on behalf of predatory, parasitic, international finance capital - most dramatically by signing the TPPA11! Labour is fully exposed as a open bourgeois party. We need an independent mass workers party!

Cash trickle downs to profits

Tertiary fees will be dropped a year at a time. But fees themselves are less of a barrier to poorer families accessing tertiary education than living costs. Raising student allowances by $50 a week will be pocket money for some students able to access a student allowance, the rest will have to increase their student loans, or continue to work part time to survive. The rent subsidy has gone directly into rent rises.  

• Only a free, universal education from pre-school to tertiary paid for by taxing profits and rents can deliver the education we need!

Increasing the minimum wage to $16.50 an hour is an insult to low paid workers. We need a living wage for all workers. And even $20 is not enough! 

• Only workers and students organising union-based wages and prices committees can decide what wage, allowance or benefit they need to live on!

Tinkering with Workplace Law

Labour’s tinkering with the workplace law doesn’t even undo the worst of the last National government’s attacks in favour of employers. And doesn’t help most workers employed by small businesses with 20 or fewer workers. They still face the 90-day fire at will scenario. Labour’s workplace policy is based on the ideology of fair shares between labour and capital. Yet global capitalism’s terminal crisis can only be solved by capital at the expense of cutting wages. To defend wages and conditions we advocate strikes and occupations. 

• Putting people before profits means expropriating the means of production under workers control!

Fiddling with the Housing Crisis

Labour proclaimed a housing crisis when attacking the National government, but what do they actually deliver? Nothing substantial. Subsidising private landlords instead of taxing capital gains means that the cause of the crisis is left untouched. The market cannot solve the problem. This just perpetuates property speculators parasitic on workers’ wages. 

• We are for minimum standards for all houses, homes, apartments, accommodation (boarding houses, motels, lodges, etc) to be set by working people. Increase secure tenancy for tenants to have longer term guarantees.

Banning overseas ‘speculators’ from buying existing houses will reduce demand but it won’t stop speculation in new builds whether the landlords are Chinese or Kiwis. We are stuck with workers making speculators rich. Why not tax the speculators? The tax working group cannot address this as their terms of reference exclude it. Too many MPs owning multiple rentals to allow Labour to entertain this radical solution. 

• We say a 100% capital gain tax on all speculative rental profits to drive the parasites out of business!

State Houses for all who need them!

Gov’t will stop the state house sell-off. Should we be happy? Not when there is no serious attempt to replace those sold off by previous Governments. We are against “social housing” as a thinly veiled return to capitalist philanthropy and a quasi-market substitute for state housing. 

• A state house with rent pegged to 20% of income should be a right for all those who need it! 

The “KiwiBuild” programme cannot produce affordable homes when the building industry is beset by profiteering monopolies like Fletchers, exploitation of subcontractors, terrible health and safety records, poor employment records (including super-exploitation of illegal migrants, cash jobs –tax free) which have driven up the costs and made housing unaffordable to most workers. So, Labour dodges the issue and sets up another committee - the “Affordable Housing Authority”.

Obviously Labour refuses to put working people before profits. It won’t challenge the property-owning democracy where land grabbing and speculation has always been a shortcut to wealth. Driven by the banks, property speculation will remain a fact of life enriching landlords and banks.  

• We say we need a massive public works scheme to provide jobs for unemployed youth in the building trades and a crash program in state house building until the demand for rental houses is met.

Fiddling with Family Incomes

Working families get a few crumbs.  Paid parental leave, and $60 per week for the following year is too little, and if it has to be applied for, then it won’t reach those who need it. A winter energy bonus is welcome relief to some, but a stopgap in the absence of warm and healthy homes. So, in effect it is a bonus to (privatised) energy companies.

Child poverty. Labour expresses liberal concern. Sets a child poverty reduction target and budget reports on child poverty statistics. Goals are good but where is the action?  

• We can’t solve child poverty without full employment, a living wage, and decent, affordable, healthy housing. So, we are back to the spending constraints of fiscal responsibility!

Mental Health, Prisons and Cannabis

Mental ill-health is a symptom of capitalist society that is broken and is alienating of the majority of the people. We know that most of the prison population have mental health problems or are in for drug offenses. Labour wants to cut the numbers in jails but won’t look at the obvious measures to achieve this. So far it plans to build the Mega prison at Waikeria. We say No Mega Prison! One alternative to new prisons is legalising cannabis. That would cut the prison population by half at least. But the deal done with NZ First will put decriminalisation or legalisation to a binding referendum only in 2000. 

• We say legalise cannabis now! Close the prisons! Rehabilitate offenders in socially useful work or training on union pay rates!

Climate catastrophe

The “nuclear issue of our age”? Oh please. Zero net carbon emissions goal by 2050. We will all be dead or dying by then. Capitalism is the cause of climate change.  

• We say the alternative facing us is survival socialism or human extinction!

Global capitalism is in its terminal crisis and all Labour can do in its first 100 days is tinker and fiddle. We get more committees, reports and talk shops: a Ministerial Inquiry to fix our mental health crisis, an inquiry into the abuse of children in state care, a Tax Working Group, a Clean Waters Summit, an independent Climate Commission, an Affordable Housing Authority.

But talk shops don’t create change especially when they fiddle with symptoms and don’t touch the real causes of these problems. For example, tax evasion by the rich, profiteering at the cost of substandard housing and damaging the environment are all symptoms of capitalism in its terminal decline.  

• We say Destroy capitalism before it destroys us!

TPPA11 cancels all the 100 days hype

The signing of the TPPA11 (Trans Pacific Partnership Agreement) is a sell-out of NZ workers to the global monopolies like Google, Microsoft or Apple who have the power to sue governments that tax or regulate their profits. What to do? We say national sovereignty means nothing if the working people do not control the economy. The profits from the TPPA11 will go into the pockets of the foreign and NZ capitalist class, the losses will empty the pockets of the workers.

Therefore, against the power of Big Pharma or Big Tech to monopolise patents and supply we say:

• ·         Socialise the health and communications industries under workers control to provide full access and free health and communications for all!

Against the power of monopolies to dictate economic, social and environmental policy by refusing to pay taxes on capital gains and profits we say:

• ·         Repeal the Fiscal Responsibility Act and tax profits and capital gains to pay for free comprehensive health, education and welfare!

• ·         Organise workers committees and councils to determine economic, social and environmental policy to meet our needs!

• ·         Nationalise without compensation the big four private banks and turn Kiwi Bank into a single State Bank under workers’ control!

• ·         Nationalise without compensation all foreign and NZ corporates that sack workers or close down!

We are for an independent workers party with a program for a Workers Government to expropriate capitalist property, socialise the economy and plan production for need and not profit!

NZ/Aotearoa: No vote for the Ruling Class!

An election this year means little to the real power: The international capitalist class. Governments whoever they are simply set the rules by which capitalism runs. In NZ, that is the Health and Education systems, and union rights, etc. The capitalist class has tamed parliamentary parties to its needs; none will deliver meaningfully for the working class. Some cater to the needs of international capitalism more than others (Labour, National), others to local capitalists (Maori Party). Most parties now pretend to be class blind because this serves the ruling class. Yet the Labour party claims to represent the organised working class. And the Mana movement claims to represent Maori workers.


Mana and Maori

The Mana movement is a Maori nationalist movement with some small capitalist influences. However, Mana has a strong record of fighting for working class issues, and on the side of colonised peoples. Mana has made attacks from the left on the Labour party, for Labour’s betrayal of working class needs generally, as well as Labour’s theft of Maori rights to foreshore and seabed resources. The Maori Party on the other hand is the party of the Iwi leadership forum, not Maori workers. It has already exposed itself as an outright capitalist party as supporter of the National lead government. Can we give critical support Mana’s deal with the Maori Party?

Mana has an electoral agreement with the Maori Party. They will not compete in each other’s electorates for the candidate vote. They will campaign for party votes. They will not criticise each other’s policies during the election campaign period.

However, this puts the Mana movement in a dangerous electoral truce with a capitalist party to try to gain seats in the capitalists’ parliament. It's a backward move because it abandons Maori workers and subordinates then to Iwi capitalists. After the election, the Mana movement says the truce is over (with the Maori Party) and everything will be up for negotiation. Mana promises to keep its political independence. But we say do not put any confidence in Mana not to join a popular front with the MP or any other party in an openly capitalist government. We say give a critical vote to Hone Harawira in Te Tai Tokerau but with no illusions that Mana will stick to its promise to represent working class Maori in parliament.

Labour as a Bourgeois Workers Party

Some workers believe that the Labour party promises to deliver more for the working class. Since the Labour party claims the name “labour”. They have a few affiliated unions: MUNZ, E tu, and NZNO, Meat Workers Union. The PSA is legally barred from affiliating with political parties but is inseparable from Labour.

The Labour party has already agreed to working with the Green party and together they released “budget responsibility rules”. These rules show the NZ Labour Party has tied itself to the capitalist system and the Green party. They promised to maintain a surplus (keep the government in profit), reduce government debt, reduce government spending to a 30% of GDP ratio. How will they give the increases needed to catch the health and education systems up to what they were before the National government? No chance because, in the fine print – there will be no change to taxation for the first term of government. They will gather a team of experts to advise them on progressive (fair) tax system. They don’t even have the backbone to suggest taxing the rich now - to pay for what workers need now. So, they are not even promising in the election campaign to do much to deliver what workers need.

Labour has stitched itself to a coalition with the Greens on a capitalist responsibility programme. It is already committing to a popular front that may also in include the openly capitalist NZ First and/or Maori Party in a coalition. They have already got capitalist (the class-blind Green Party) allies who they could blame for their failure to deliver for working class needs. They cannot be given critical support on this basis. Their betrayal of working class “labour” has been revealed before they take the parliamentary leadership. The Labour party in parliament gives crumbs to the union affiliates while working class wages and conditions are run down - including the “social wage” of health and education systems. Labour they have already signed an allegiance to the capitalist class and the Greens through the above agreement. That plan is blatantly capitalist.

Labour could have campaigned to run a minority government, without capitalist plans and without being tied to capitalist parties. Union affiliates, it is over time to split from Labour, as it has already shown it will not deliver what the working class needs not after this election or the 3 years following.

We always called the NZ Labour Party a “bourgeois-workers party”: because in spite of worker membership they have had a capitalist programme. The Labour Party has never challenged to overthrow the capitalist economic system. Labour party sells false hope – that they could deliver what workers need within capitalism. This means they serve to tie workers into capitalism, the parliamentary road does not lead to socialism. The task for revolutionaries then is to break working class from this false hope!

The tactic of Critical Support

In previous elections, we have tactically called for “critical support” for Labour (and in the past New Labour and Mana) – called on working class to put Labour into government – to show it up as failing to deliver for workers. We could say that this tactic broke some unions from Labour, after the 1984-1990 Labour government a number of unions broke (disaffiliated) from Labour. In the absence of revolutionary leadership, the maritime union is now back as Labour’s union affiliates. These unions continue to act as a pathway to suck working class into parliament.

So, in this coming election we do not give critical support for Labour. While it remains a bourgeois workers party, the tactic of critical support cannot work if Labour is tied to openly bourgeois parties - in this case the Greens and/or NZ First in a parliamentary coalition. This is because the rotten bourgeois leadership of Labour can hide behind the excuse that its partners in government stopped it delivering on its campaign promises for workers. Voting for Labour in the certain knowledge that it has already committed itself to forming a popular front with openly bourgeois parties would be to conspire with Labour to hide its class politics from workers. This would be a betrayal of our main strategy to break workers from the labour bureaucracy and from the bourgeois class enemy!

The main strategy is to build the working-class movement independent of parliament, that is our task. It is difficult when the unions are held by their leadership in a relationship with the Labour party and the idea that capitalism can be reformed to meet the needs of workers. Minor reforms in the face of major erosion of working class wages and conditions over the years shows how ineffectual reformism is. But every election year the union leaders say – vote Labour and we could get more of what we need. This takes the power of workers away from united action into a meaningless voting box.

Independent working-class movement

The only reason workers need bother with parliament is to use it as a place to speak and denounce parliamentary democracy as failing to deliver what we really need. We can only organise and take power outside of parliament with elected delegates, with councils of workers to run the towns and communities, strikes to force living wages from employers and occupations and running the businesses under workers control.

· For independent candidates of the working class. Any working-class members of parliament to use the place as a platform to speak and raise revolutionary politics and denounce the ruling class and all their parties!

· For working class candidates to stand against labour candidates in the general electorate seats and Maori seats, other than Te Tai Tokerau where Hone Harawira will be standing for Mana movement! Let’s see unions put up our own candidates in the electorates. Unionised workers are ignored and marginalised under Labour party rules and deals, take the fight outside the party!

· Revolutionary candidates only stand to use parliament as a platform to speak- the power of the working class is not held within parliament. Remember the capitalist class holds power outside parliament in the police and armed forces as strike breakers!

· There is a crisis of leadership of the working class, labour and the trade union leaderships have sold out the fight before we even start: build a workers’ revolutionary party!

· Critical support for the Mana Movement while it stays out of popular fronts!

· No Critical Support for the Labour Party in a popular front coalition with openly capitalist parties!

· No support for the other capitalist parties!

· Build an independent mass working class party capable of standing candidates on a Transitional Program to build workers councils and fight for a Government of the Workers and Oppressed!