CTU Alternative Economic Strategy – Socialism is the Answer

The AES
document produced by the CTU for the 2009 biennial conference is
welcomed as a contribution to the debate on the way forward for the
New Zealand working class. The AES document has been produced to try
to clarify the present world financial crisis and seeks to provoke
discussion and debate. There is some useful analysis of the
capitalist system.

This is an
initial comment on the AES and we hope to produce a pamphlet
outlining our views more fully in the future. Comments will also
appear on our website.

Capitalism

Capitalism
has existed for about the last 350 years. Before that people existed
under other systems such as primitive communism, slavery and
feudalism. Capitalism has been the dominant form of the world economy
for a relatively short period of time and cannot be the final chapter
of world history. Despite the claims of other commentators history
has not finished. The class struggle continues.

In the
final analysis the nature of the means of production provides the
basis on which our social, economic and cultural activities function.
The present global financial crisis was not caused by the bad
behaviour of some individuals (bankers). If it had been then the
solution would be easy – get them to behave better in the future!
Rather it is in the very nature of the capitalist system – it is an
organic crisis. That is, the problem is that the capitalist system
has reached an impasse. The development of the productive forces has
outgrown the narrow limits of private ownership of the means of
production and the nation state. Crises are an integral part of the
capitalist system, as outlined by Marx and Engels in “The Communist
Manifesto” over 150 years ago.

The most
important question, however, is not banking but the real economy; the
production of goods and services. So that they can make a profit the
capitalists must find a market, today, usually the world market. For
some time there has been a market for the goods produced but as
credit dried up, and confidence was eroded, the markets dried up so
too many goods were being produced for too few customers. This led to
the crisis which in Marxist terms is the crisis of overproduction.
Companies are reducing or stopping production selling their stocks
and waiting for demand to return.

Imperialism

Globalisation,
or, to give it its proper name, imperialism is nothing new. It was
identified by Lenin in his book “Imperialism
the highest stage of capitalism”.
We are now experiencing, for the first time, a totally integrated
world market so the economic crises that started in America has
spread all round the world. And despite claims that New Zealand would
not be affected it has been hit hard with unemployment and short time
working reaching record levels.

The
document firstly makes some proposals for the reform of the New
Zealand economy. It timidly suggests buying back Telecom and part of
the electricity company that had previously been sold off cheaply.
They should be taken over and compensation paid to small shareholders
on the basis of proven need.

It also
hopes to control the financial institutions that got us into the
present mess. It would be utopian to suggest that individuals like
George Soros, who made over $100 million speculating against the NZ
Dollar in the recent period could be regulated.

Tobin
Tax

The
so-called “Tobin Tax” on financial transactions would not deter
such speculation as was the aim when James Tobin put it forward
nearly 40 years ago.

Taxing the
rich, those earning over NZ$150,000, would begin to address the
question of the inequalities of wealth but it is noted that the gap
between rich and poor in New Zealand has widened over the last 15 to
20 years despite having a Labour Government for half that time. The
capitalist class would not accept attacks on its wealth and would
take steps to protect their money – transferring it overseas for
example.

The
document also deals with the conditions faced by the majority of New
Zealanders in education, employment, housing and retirement benefits.
On housing, for example, it suggests low interest rates when buying a
house which would relieve the burden of repayments. But whilst
suggesting a review of housing needs, it is apparent now that there
is a lack of affordable housing so there should be a crash housing
programme by the government to reduce prices and take building
workers off the dole.

Minimum
Wage

We support
the call for a minimum wage of about $17 per hour which should be
kept at 66% of average wages. When the modern minimum wage was
introduced in 1945 it was set at about 85% of the average wage. The
campaign by Unite for $15 is supported by the rest of the Labour
movement but a national campaign of demonstrations and strikes should
be organised to show the bosses that we mean business.

Finally
there is a call for participation by the unions in setting priorities
for companies. We believe that is all it would be, if at all. The
workers understand their work place and how it should be run. There
are examples, such as SIDOR steel works in Venezuela, where the
company has been nationalised and is run by the workers under their
control and management. New Zealand has a more industrialised economy
than Venezuela and it would be possible to organise in the same way.
The CTU wants to direct and encourage the capitalists to “engage”
with the workers but we believe that they will only listen and
negotiate when workers make a stand.

The
document begins to identify the problem but it assumes that gains can
be made within the Capitalist system. Improvements may be won but
they will soon be taken away. The National Government has started to
attack the conditions of the working class not necessarily because
they want to but because the system has reached a point that they can
no longer afford to pay. The increase of 25 cents in the minimum wage
is an insult and attack. That amounts to NZ$10 per 40 hour week for
380,000 people. That’s only $4 million dollars or one banker’s
bonus.

If the
system can no longer provide the people with decent conditions then
the system should be scrapped and replaced with a socialist society
based on the nationalisation of the major firms under workers’
control and management so that the economy can be planned for need
rather than profit.

You
cannot plan what you don’t control

You
cannot control what you don’t own.