Friday, December 19, 2014

NUMSA: Which way forward?

The Marikana miners are the vanguard of the South African workers

NUMSA* broke with the ANC/SACP before the last election. It was then expelled from COSATU to prevent it from convincing the majority in COSATU to break from the ANC. This break however, is not complete. NUMSA President Irvin Jim calls for the return to the Freedom Charter which has been abandoned by the ANC/SACP. He presents the Freedom Charter as in the interests of workers when it was always the SACP inspired Stalinist program aimed at creating a Black bourgeoisie. Secretary General of COSATU Zwelinzima Vavi has thrown fuel on this fire in his recent Open Letter to the SACP slamming it for consistently opposing COSATU’s resistance to the neo-liberal policies of the ANC since 1994. While NUMSA calls for a ‘united front’, and a new ‘workers party’, at the same time as a ‘return’ to the Freedom Charter, this will lead to a new ‘popular front’ with bourgeois figures like Ronnie Kasrils, former Minister of Information in the ANC. We look at the stand taken by different currents on the left and put forward out position for a revolutionary workers party and program.

NUMSA Splits from the ANC/SACP*

On the left we note the positions of Socialist Project, the WASP and the WIVP. All welcome the NUMSA break with the ANC/SACP but disagree on how to make this break complete. The most immediate disagreement is whether NUMSA should fight to overturn its unconstitutional expulsion and continue with its fight to get COSATU as a whole to break with the ANC/SACP.

This is important because those like Socialist Project who think NUMSA should not challenge its expulsion abandon any fight for democracy in COSATU, leaving the rank and file of other unions at the mercy of the bureaucratic ANC/SACP dominated leadership. It leaves uncontested COSATU CEC’s unconstitutional action in blocking a special congress where NUMSA could advocate a COSATU split from the ANC. At the same time it writes off the role of COSATU and advocates a social movement perspective outside COSATU.

Second, those who want NUMSA to challenge its expulsion are divided over the use of the bourgeois courts. We say that since NUMSA is a workers organisation and has fought for decades to enshrine workers democratic rights in its Constitution, going to the courts to overthrow an illegal expulsion is not a matter of principle. The principle involved is: that defence of bourgeois rights is necessary when it advances the workers’ revolution. The tactics employed must serve this principle.

We are opposed to taking COSATU to Court over the expulsion under the current circumstances. We don't think it advances the workers revolution. It takes the struggle out of the hands of the rank and file of COSATU affiliates when it is strong enough to challenge the leadership, defend the constitution and overturn the expulsion. It seems that appealing to the Court is a tactic being used by the leadership to foster illusions in the Courts as independent of the ANC/SACP corrupt regime, rather than mobilising the ranks to throw out the corrupt COSATU leadership.

On the other hand, those who argue that NUMSA should abandon COSATU as corrupt and instead build a new union movement, are weakening the mobilisation of the rank and file within the unions to oppose the Irvin Jim leadership in going to the Courts, calling for a return to the Stalinist Freedom Charter, and inviting ‘progressive’ bourgeois factions who are proven enemies of the workers into the ‘united front’.

For example, the NUMSA ‘United Front’, at its small ‘preparatory assembly’ ahead of the launch next April, put the bourgeois politician Ronnie Kasrils, an ANC Intelligence Minister responsible for collaborating with the CIA and Mossad, on its ‘interim leadership commission’! His ‘workers’ credentials are no more than opposing Zuma, and campaigning for a ‘no vote’ for the ANC. We agree with the WIVP that the NUMSA split is in danger of becoming ANC Mk2 by including corrupt bourgeois celebrities. Who is next: Julius Malema and his personality cult to revive the Freedom Charter?

Break from the Freedom Charter!

All of this points clearly to the main weakness of the NUMSA split from the ANC. It does not split with the Freedom Charter. It does not complete its break with the ANC/SACP program. If the bureaucratic expulsion from COSATU leads to a new bureaucratic labour movement, (despite the ‘united front’, workers’ party’, and ‘socialism’) then the democratic will of the mass of workers moving against the ANC/SACP/COSATU will face yet another bureaucratic barrier to their class independence and the socialist revolution.

The WASP approach to this problem is to ignore the question of program and talk only about organisation. It supports going to court to make COSATU hold a Special Congress. At the same time it calls for NUMSA to press ahead with its ‘united front’ to rally all COSATU and non COSATU unions around a ‘socialist’ program. Yet it neither critiques the COSATU leadership’s illusions in the Freedom Charter nor comes up with a ‘socialist program’ of its own.

It is not possible to build an independent trade union movement on socialist principles without a clear call to break from the Freedom Charter! Given the history of WASP in the Militant tendency, we expect that it to be silent about the ‘united front’ failing to challenge the Freedom Charter and making compromises with the bourgeois politicians like Kasrils which turns a workers ‘united front’ into a bourgeois ‘popular front’.

That is why the WIVP call to replace the Freedom Charter with a Workers Charter is correct.

“In opposition to the Freedom Charter, we propose the consideration of the development of a Workers’ Charter, based on working class demands, both democratic and Socialist, of a programme for working class power and a workers’ government. Let us cast off the old clothes and prepare the basis for a new revolutionary working class party.”

WIVP rejects the Freedom Charter as the ANC/SACP program for the national democratic stage in which the black bourgeoisie comes to power to prepare the road to socialism. Yet the National Democratic Stage (NDS) did not lead the nation to independence from imperialism and open the road to socialism. 20 years of black bourgeois rule has proven beyond doubt that the rule of imperialism has been entrenched and the working class has been subjected to imperialist super-exploitation.

The Workers Charter as summarised by the WIVP is the Trotskyist Transitional Program. The task of revolutionaries is to raise it in all the ‘united front’ actions along with the call for the formation of a mass workers party. It would become a rallying point inside and outside the unions for a genuinely independent workers movement.

Use the Transitional Method!

Underlying the Transitional Program is the Transitional Method. This is another word for dialectics, the method Marx developed as the basis of his revolutionary critique of capitalist political economy. Dialectics means that society is based on a contradictory unity between objective reality and subjective reality where the latter acts on the former to make a new objective reality. Marxism does not separate theory from practice.

Theory helps us understand how capitalism works objectively as class society and this subjective knowledge transforms our class consciousness to guide our struggle to overthrow class society. The highest expression of this subjective reality is the Marxist Party which uses the program as a scientific weapon to advance the consciousness of the proletariat in its struggle to transform capitalism into socialism!

Is South Africa right now, the objective reality is the ANC bourgeois capitalist regime that oversees the super-exploitation of the working masses in return for a cut in the profits for the new black bourgeoisie. The bourgeoisie ‘trickles down’ some of its profits to buy the bureaucratic leadership of COSATU as part of the ‘popular front’ to strangle any independent workers movement from breaking with the regime.

However, for Trotsky, the main task of the unions as "schools for revolution" is: the "...complete and unconditional independence of the trade unions in relation to the capitalist state. This means a struggle to turn the trade unions into the organs of the broad exploited masses and not the organs of a labor aristocracy."  

In South Africa the unions have begun the struggle for independence from the bourgeois state. Marikana expressed the objective reality of poverty in radicalising the subjective consciousness of the miners. It was this radicalising of the base of the unions that has forced the NUMSA leadership to split with the ANC and its Stalinist SACP bedfellows to head off a break with the Freedom Charter. The result is the big fight inside COSATU where the mass membership is moving to break with the Freedom Charter against the resistance of the bureaucratic leadership that is still defending it as the program of the black bourgeoisie.

In the words of Nelson Mandela:

“The Charter is by no means a blueprint for a socialist state...The Charter does not contemplate such profound economic and political changes. Its declaration “The people shall govern!” visualizes the transfer of power not to any single social class but to all the people of the country be they workers, peasants, professional men or petty-bourgeoisie... For the first time in the history of the country the Non-European bourgeoisie will have the opportunity to own in their own name and right mills and factories, and trade and private enterprise will boom and flourish as never before.”

To activate this change in workers’ consciousness to the point of a complete break from both the bureaucracy and the bourgeois state revolutionaries must raise the Transitional Program in the unions. Replacing the corrupt union bureaucracy with a new leadership accountable to the ranks would prove wrong Socialist Project’s claim that trade unions cannot represent the majority of workers because they are irrevocably compromised by their links to the bourgeois state.

Like the Marikana strike it would prove that corrupted unions like NUM can be replaced by rank and file struggle unions such as the AMCU and that their isolation, as in the recent Platinum strike, can be overcome by a ‘united front’ of all unionised and non-unionised, domestic and unpaid workers preparing for a general strike.

Finally, it would coordinate all united front actions under the leadership of a mass workers party in which revolutionaries would fight for the adoption of a transitional ‘Workers Charter’, for “working class power and a Workers’ Government’, as part of an international struggle of the working masses of the whole of Southern Africa for a Federation of Socialist Republics.

20 December 2014

*Note ANC (African National Congress); NUMSA (National Union of Metalworkers of South Africa); SACP (South African Communist Party); COSATU (Congress of South African Trades Unions); WASP (Workers and Socialist Party); WIVP (Workers’ International Vanguard Party).

Monday, December 15, 2014

NZ: Piketty vs Marx


The publication of Piketty’s book “Capital in the 21st Century”, on the historic inequality of capitalism, has sparked a debate globally, and in NZ with the publication of “The Piketty Phenomenon: NZ Perspectives”. We have commented that Piketty fails to understand the basic cause of capitalist inequality so that his wealth tax cannot be the solution. The OECD Report on Inequality goes further that Piketty to show that income inequality has a negative impact on economic growth. It argues that income must be redistributed to increase labour productivity. We explain that this solution means further increasing the exploitation of labour by capital. It will fail because capital in the 21st century has outlived its capacity to meet the needs of humanity so that humanity will refuse to be super-exploited. What is needed is Socialism in the 21st Century!

Piketty’s New Law

Piketty challenges the crude assumption of neo-liberal economics, that capitalist growth works automatically (‘trickle down’) to produce equality. He has discovered a ‘new’ law where capitalism works so that those with wealth accumulate more wealth at a faster rate than everyone else unless the state steps in to regulate this inequality. The solution is to tax wealth by 1 or 2% to keep it in line with long-term GDP growth. Several contributors to the Piketty Phenomenon (PP) see this challenge as a ‘paradigm shift’ in economics that carries a ‘progressive payoff’ for social democrats. (Geoff Bertram in PP)

The rejoinder from the right is that the Gini Index for NZ has been flat at 32 since the late 90s. So Piketty’s law didn’t operate during the Clark and Key governments. Bernard Hickey in PP, points out that wages, benefits, ‘Working for Families’ and subsidised health and education kept the Gini rate flat. But Hickey says Piketty’s work is a warning against any further erosion of the welfare state.

Radicals critique the Gini Index as a blunt statistic, and GDP as a measure of growth. Inequalities around gender, ethnicity, youth etc., fly under Piketty’s radar. Given the prevailing labour market super-exploitation of women, Maori and Pacifica, and youth workers, such groups are doubly unequal. Radical economists have been doing much more detailed work for years to redress such inequalities. (Susan St John in PP) For Gareth Morgan (in PP) a reformed tax structure that includes a Tax on Capital Assets and an Unconditional Basic Income will do this. Feminists and unions have been actually fighting on the streets for such reforms. For Prue Hyman (in PP) taxing capital is not the answer. Capitalism as a system that demands destructive and wasteful growth at the expense of inequalities must be ‘unplugged.’

OECD says inequality stops growth

The IMF and OECD have taken this challenge to neo-liberal economics a step further. They say inequality stops growth. The OECD research paper says that in NZ rising inequality since 1985 has cut GDP growth by 10%. The solution is a wealth tax in some form provided it is targeted at increasing labour productivity. In the OECD language GDP growth depends on Human Capital Accumulation (HCA). It argues that taxing the top 10% will not damage growth, implying that much of this income is not productively invested. The state should redirect this ‘surplus’ unproductive capital into ‘human’ capital’.

Unlike classic Keynesian attempts to boost consumption, or the bailing out of the banks, the OECD fixates on education. Putting money into the pockets of capitalists and/or consumers does not necessarily restore growth. Just look at the printed money that has flooded into the pockets of the rich. And raising the dole may lead to more consumption but not necessarily to more investment. Work for the Dole everyone?

The research shows that increasing labour productivity will increase profits and hence encourage capital to invest in more production. So improving the quality and quantity of education [HCA] and creating incentives to work is the answer. Has the OECD come up with education and workfare as the ‘holy grail’ of Social Democracy? No. We will show that while education is related to rising labour productivity, there is no guarantee that that will induce capitalists to invest in more production. This is no guarantee of profits. This is because increasing labour productivity means rising labour exploitation. Piketty/OECD type policies can’t work if the owners of capital resist taxation. Or the owners of labour power resist super-exploitation. The progressives seem to have overlooked one small detail and that is the class struggle!

Marxist critique

Piketty is really lost without Marx. He lumps real productive capital (that produces value) together with unproductive assets (that don’t produce value) to make up his ‘Pikapital’. He discovers booms periods when the wealthy accumulate much more rapidly, then busts when they lose much of their wealth. Had he bothered to read Das Kapital, he would have realised that the switchback rides of the wealthy is a symptom of the inbuilt tendency for capitalist crises.

This is a telling gap in Piketty’s economics. The underlying reality he ignores is the exploitative relation between capital and labour where wage labour is employed to produce more value than it needs to reproduce itself; that is, surplus value the source of profit. This is capitalist inequality at the level of productive relations. Crises arise when profits begin to fall when the amount of surplus value is insufficient to cover total capital investment. As the Tendency for the Rate of Profit to Fall (TRPF) kicks in capital in plant and machines and wages must be destroyed, and cheaper means of production employed, so that the amount of surplus value is now sufficient to return a profit on total capital outlayed. The destruction of the wealth of Piketty’s wealthy class then, is merely a symptom of capitalism’s crises of falling profits.

As Marx explains, this relation of production appears in the marketplace as a relation of exchange as capitalists buy the labour power as a commodity. Marx calls this ‘commodity fetishism’. The expropriation of surplus value in production is perceived to be based on unequal exchange in the market. Crises then occur when labour demands the full price of labour and profits fall. Or, capital demands low wages, so consumption falls; in both cases investment stalls.

Neo-liberal economics in the thrall of commodity fetishism argues that the market will automatically correct the share of wages and profits so that demand rises and production results. The crises, wars and depressions that Piketty stumbles over are such ‘corrections’. Yet as Keynes recognised in the 1920s, these painful ‘corrections’ might be avoided if wages were boosted by the state to create ‘sufficient’ demand that would then be supplied by thankful capitalists. Oh for a world with no more slumps!

NZ: a test of Marx v Keynes

However, Keynes was still a bourgeois economist. Boosting demand did not create new production unless investment was profitable. Demand was not the key factor; it was the rate of exploitation. The state could intervene in the market but only to the extent that it met the need for rising profits. In NZ the election of the First Labour Government in 1935 put this reality to the test.

However, far from representing a solution to capitalist crises, The Labour Party acted to guarantee profits for the emerging NZ capitalist class. The First Labour Gov't was able to create a ‘welfare state’ for workers because the protected domestic manufacturers operated at low efficiency and there was a demand for labour. Full employment was the hallmark of Labour’s social policy because it could be exploited profitably not because it could buy what it produced. This was proven after the WW2 created boom busted. The return of a crisis of falling profits could not be averted by the Keynesian state boosting consumption, so by the mid 1960s the TRPF re-emerged as the cause of a new slump.

This time the return to profits required the end of protectionism of both domestic capital and the labour movement. The destruction (restructuring) of productive capital (plants, machinery) and jobs and the driving down of wages, was achieved by opening up the domestic economy to the global economy. The conditions under which Keynesian intervention operated from the 1930s to the 1960s were replaced by neo-liberal globalisation. The destruction of wealth by depression, its revival by war/boom, and now its further restructuring by neo-liberalism, has inserted NZ into the global division of labour where the concentration of wealth and power in foreign and local crony capitalist hands results from the rise of inequality and deprivation in the working class.

So what are the prospects for “progressive politics”, a revival of Social Democracy in defence of the ‘Welfare State’, or even a modest Piketty/Morgan/OECD type wealth tax? Piketty knows that the power of the wealthy to resist a even a 1% tax on their wealth makes it a utopia. But this does not stop progressives in NZ from proposing various forms of wealth tax backed up by the OECD claim that profits flow from increasing labour productivity!

Marxist Revolution in thought and deed

The detail that is overlooked here is that greater labour productivity creates more inequality not less. Not the superficial market inequality measured by the national Gini Index, but the concentration of capital in fewer and fewer hands, and the accumulation of poverty and misery in the lives of the masses of workers. Raising the rate of exploitation means workers produce more per hour (because of HCA) but get a lesser share of the new value produced. This confirms Marx law that the rise in the rate of exploitation is set by class struggle and is ultimately the barrier that capitalism cannot overcome. Workers’ resistance to rising labour exploitation is the single factor that guarantees that capitalist crises will sooner or later result in the proletarian revolution and the rise of socialism out of the ashes of capitalism.

We need a Marxist revolution in thought and deed. A Marxist revolution in thought means understanding that capitalism is a finite social system based on the ultimate destruction of the only sources of wealth - labour and nature. The survival of humanity depends on this consciousness that capital is nothing but the expropriation of labour value, and that if labour is to survive it has to take control over the value it produces.

The Marxist revolution in deed is the task of organising the proletarian revolutionary class as capital’s “gravediggers”. It will require the formation of mass workers parties in every country that unite internationally to confront capitalism’s power and wealth on every front, creating workers governments with the power to socialise the wealth expropriated by capital over centuries as the basis for building a new socialist world that values the survival of humanity and nature.

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