Salterre

24 - September - 2009

The AGE of MERCHANTS

An essay on the present evolution of the
Capitalist socio-economic system before
descent into Chaos
About the triumph of selfishness and Human
stupidity.
OUTLINE OF THE ESSAY

This book has thirty three chapters divided in four parts.

In the first part, I will try to explain my notion about the inner
essence of the capitalist economic system, its natural laws and
mechanism, and how these cannot be altered without changing
the system completely. These laws and mechanisms are the
natural result of a particular environment, they were naturally
suited to that environment; that original environment do not exist
anymore and they cannot rationally function in a different
situation.

In the second part, I will try to show the relation between

capitalist economy and our present social and ecological
problems. I will try to show how the natural laws and mechanism
of capitalist economy are producing unnatural and irrational
results when applied in the present environment of saturation: an
environment which is almost the opposite of that in which these
laws and mechanism have developed and could function in a
rational way.

In the third part I will attempt to explain my point of view on ways

by which we could evolve towards a more rational society. I will
also try to explain a simple philosophical basis that could be a
catalyst for people of different backgrounds who have the same
basic interest in a meaningful survival.

In the fourth part of the booklet I will try to put into perspective
the background stage on which the Human race has evolved: a
small planet in one of the solar systems in a galaxy in the
Universe. On this planet, Human societies have evolved, and
capitalist society is one of them: a brief moment in the history of
Humanity.

This brief analysis represents in essence my personal point of

view on the nature of our present problems. I hope it may be a
contribution to further and wider discussion.

SOME READINGS AND REFERENCES.

ADAM SMITH The Wealth of Nations

KARL MARX and FREDERICK ENGELS Capital Vol I

The Manifesto of the Communist Party 1848

Selected Works

MAO TZE TUNG Selected Works

DICK WILSON Mao the people’s emperor

CHARLES DARWIN The voyage of the Beagle

A.E.LEAKEY Origin of the Species Abridged

TERENCE BYRNES Adam Smith, Malthus and Marx

SIR ALEX CAIRNCROSS Inflation, growth and international

finance

C.E. DAVIES The emergence of Western Society

MILTON FRIEDMAN Free to choose

ROBERT HERLBRONER Business civilisation in decline

J. HUTSON From penal colony to penal powers

LEONARD G. LEWIN Report from Iron Mountain

 FRANK MAINSWORTHY Economics - What went wrong

RALPH MILIBAND The State in capitalist society

JOHN STUART MILLS Utilitarianism - Essay on Bentham

VANCE PACKARD The naked society

The hidden persuaders

The people shapers

The waste makers

AYN RAND The virtue of selfishness

Capitalism : the unknown ideal

PETER ROBINSON The crisis in Australian capitalism

R. REICH The greening of America

R. SMITH The economics of the cold war

ANTHONY SAMPSON The seven sisters

The money lenders

ALVIN TOFFLER Future shock

RICHARD J. BARNET & RONALD E. MULLER Global reach

E.F. SCHUMACHER Small is beautiful

J.K. GALBRAITH American capitalism

N. HARRIS Of bread and guns

SUSAN GEORGE How the other half lives

F. A. HAYEK The road to serfdom

WILLIAM BLUM Killing Hope

Rogue State
 ANDREW KEVIN MARSHALL Global Power and Global
Government

FOREWORD 1980-2000.

Partly because of inclination and partly because of circumstances,

I believe that I have acquired an inquisitive mind. I am not sure
whether for me this has been a gift or a curse. Often I have
considered lucky those people who live by instinct, without
questions, and let life to take care of itself.

Because of this inclination and because whenever I had a

discussion about politics and the economy with friends,
workmates or anybody else the discussion always ended up like in
a vicious circle with the first questions or objections being asked
all over again.

For this reason, about ten years ago (1970s) I wrote a sort of an
essay with the purpose of delineating my personal opinions on the
problems that were plaguing our society at the time; I tried to
explain the connection that those problems had with the current
economic philosophy and with the nature of Capitalist economy; I
intended to stop wasting time and breath arguing each point that
I was making and instead give them the booklet to read.

At the time, the Cold War was at its peak and that, more than the
social and ecological problems, was the main concern.
Today, the danger of a global nuclear conflict between the
capitalist West and the Soviet Union has disappeared, as the
Soviet Union no longer exists. The first experiment of creating a
new socio-economic organism directed by Humanistic ideals of
fairness and justice has been made to fail.

This attempt probably was doomed from the start; born from a
destructive war and revolution in a society still under-developed
and still with a feudal mentality, opposed from within and from
outside, surrounded by countries with governments determined to
crush it in its cradle, it was forced to acquire a siege mentality.

In such an environment, it was bound to develop into a

dictatorship. As it is the consequence of every dictatorship, it
eventually produced a new privileged class and it became
corrupt, therefore, the people lost their innocence and their belief
in the ideals for which, in the beginning, they were prepared even
to give their life.

This first failed experiment was not in vain. It produced reactions

in the rest of the world that forced the insensitive Capitalist
establishment to limit their exploitation of the Human resources
under their power, or at least to pay lip service to the same
Human ideals that the Socialist were aspiring to. I hope that the
experience of this first failed attempt will show the pitfalls to be
avoided, and will show us a more enlightened way to be adopted
in the next attempt that, I am sure, will eventually take shape
(1980s).

I am so sure for two main reasons: one is that I believe that what
is good in Human nature will always manage to survive. The
Human condition, those ideals of fairness, justice and kinship on
this small and fragile planet Earth, cannot have completely
disappeared. The second reason, and the more compelling, is that
those problems that I ventured to analyse ten years ago are still
present more than ever, aggravated and compounded.
Today the connection between our ecological and social problems
and Capitalist economic philosophy is ten times more evident
than it has been in the recent past.

The eunuchs of the Media, understandingly, are not prepared to

risk their jobs by publicising what should be obvious to anybody
with a bit of intelligence and common sense: that Capitalism has
come to the end of the road. There are a few journalists who still
have some honesty and self respect and are timidly starting to
hint at the hopelessness of Capitalist economy to solve the
problems that it itself is creating.

The threat of global nuclear war has receded; but, in its place, the
senseless trade war that has been going on all along is
intensifying. More contenders are coming into the battlefield.
They are the ex socialist countries, that by adopting Capitalist
philosophy, the "philosophy of the merchant" - to buy and sell as
the only condition of survival - they are forced to indebt and
castigate themselves to be able to compete on the saturated
world's market. As all other developing and underdeveloped
countries are already doing the same, the price of most
commodities on the world's market is being depressed more and
more; it is a senseless competition between Nations to throw
each other out of work.

The more indebted Nations cannot free themselves from this

stranglehold; they must sell whatever they may have that the
customer wants, and at his price. They may have to sell their
forests, their birthright and the future of their own children for a
pittance. They must let themselves be developed in whatever
form the investors choose without regard for their own real needs
or the pollution of their own environment. If they have nothing to
sell, then they must sell themselves: once proud self sufficient
Nations are turned into Nations of servants, shoeshines and
prostitutes.
So far all the answers to the problems created by the saturation
of capitalist economy have been unconvincing and superficial.
The solutions offered have been ineffective. The reason is that at
present every investigation about the causes of our social and
economic troubles has stopped short of a deep search into the
essence and nature of our socioeconomic organism. This is not a
coincidence. It is a conscious attempt to hide the real origins of
our problems by those who are in a commanding position and,
therefore, are mainly responsible for them.

It is the same as an unconscionable power had set the terms of

reference to limit the scope of any inquiry into our social and
economic problems only to the superficial appearances and the
secondary causes. But it is evident that the real causes of our
decline can only be found deep within the nature of our system.

In this discussion I will attempt to explain in general terms my

notion of the essence of our economy and its relation to the
present situation.

In this sort of an essay I will only deal with the main rational
concepts and capitalist logic. Detailed evidence can be seen in
our everyday lives; also it is readily available in books, reports
and other literature that I have come across over the years, and,
together with my life experiences, form the basis for my
assertions. I do not claim originality, most of what I will say has
already been said, and in a better form. In this analysis are the
conclusions that I have reached after many years of reflection.

A person's thought is the continually changing product of a long

process of experiences and of a long process of assimilation of
previously accumulated knowledge. A process that starts long
before one's birth. In my particular case, as I have little memory
for detail, I have forgotten the origin of most that I have learnt
and has found a place in my mind. I acknowledge that I am not
the prime origin of my thoughts, I stress that many sentences I
have used belong to the authors of the books that I have read;
they are the best expressions of ideas and they cannot be
improved. Moreover, I am aware of my ignorance and bias.

Before I start, I want to make a very important point: it is far from

my intention to blame capitalist businessmen entirely for the
problems that we are facing today. At present, they are the actors
that have been cast to play the villains in the drama of Human
life.

As much as they may be the main determining factor in the

evolution of capitalist society, they are themselves enslaved by
its economic necessities, and they also will eventually become the
victims of the system.

They are Human beings and their actions and attitudes are
reinforced by the natural laws of Capitalism and human
imperfection. It is only when they attempt to perpetuate at all
costs a system that has become obsolete and destructive that
they become dangerous.

We are all potential capitalists as we live within a capitalist

organism, and we are bound by its forces in our daily struggle for
immediate survival. Everybody must have witnessed at some
time how the poorest person or the most staunch supporter of
Labour, when becoming a businessman or coming in possession
of wealth, will gradually or even suddenly assume the attitudes of
a capitalist and, when put to the test, will become a conservative.

It is my opinion that, as Adam Smith pointed out over two

centuries ago, that ".....the evils come from the system, not from
the character of the men who administer it...", but also I believe
that because of the nature of capitalist business competition
those who reach the top generally are not necessarily the most
intelligent and honest but rather are the most selfish, cunning,
ruthless and insensitive human beings. I think that, in the main,
this is true. Nevertheless they must be prevented from destroying
this Planet that so far has been suitable to Human life.

I hope that the reader will keep this in mind right through the
discussion, no matter how vilified the capitalist "merchants and
manufacturers" may seem to be.

Here I will talk about ourselves Human beings locked in a socio-

economic organism in its final dangerous stage of evolution.

FOREWORD 2009

Updated 3 September 2009.

Now it is 2009, and I would like to point out that this short booklet
has gradually taken form in my mind during the 1960-1970 and
eventually was written in 1980; therefore many ideas and
statements were formulated during the times of the Cold War, the
struggles of Capital and Labour when the Unions and the Labour
party in Australia were still militant and Neo-colonialism was
rampant in the underdeveloped countries after World War II.

Many ideas and statements therefore reflect what was happening

in those times; nevertheless, as it will be shown in this booklet,
the nature and mechanism of the system has not changed.

Capitalism, as it happened to every previous system before it,

inexorably is progressing by its unstoppable natural momentum
towards its demise; if no rational alternative is urgently found,
chaos will ensue with ecological changes that may not be
favourable to Human existence as we have experienced so far on
this Planet.

In the 1980s I tried to get this booklet published, but as I am not

an academic I did not get any support. Not surprisingly I was told
once that they would not consider publishing a book against
Capitalism as they were merchants themselves.

Now I am getting on and I am getting close to find out if number

42 is really the answer to the “question of Life, the Universe and
Everything”; therefore before I depart, as I would like to make a
small contribution towards saving this small Planet (laugh), I am
taking advantage of the Internet and forward this sort of an essay
in every possible direction hoping that enough people with a lot of
mental stamina or a good stomach may actually read it. The book
is free to read, to download and disseminate in any form.

Of the few people to whom I gave the book to read none actually
managed to read right through it; they all succumbed to total
mental exhaustion by the time they got to chapter III or thereof; I
do not blame them, it also happened to me. I feel sorry for them
because they will have missed the few jewels that certainly can
be found within the booklet’s copious BS.

For this particular reason I have moved Chapters I, II and III to the
end of the book; another reason is that because I am not an
Historian my brief description of a subject that requires a
thousand volumes must be very subjective and inaccurate.

To me, having seen and experienced a lifetime of change, the

opinions and assertions that I am presenting seem quite rational
and obvious but I fully realise that the majority of younger people,
having been born in the present Era and having been
moulded into consumerism since their birth, they are bound to
take the present situation for granted; they cannot even imagine
that a better alternative to Capitalism would have been possible
under more favourable circumstances in the past; they cannot
even imagine that a better alternative not only is still possible in
the present, and easier to achieve given the progress in
technology, production and general education, but it is imperative
and essential if they want to survive in a better society on a
Planet still supportive of Human life.

The book is a real brick; the sentences are too long and there are
too many repetitions, the main reason is that I tried to write each
chapter so that it would make sense and stand on its own; to do
that in most chapters I had to mention again and again the same
basic natural features of the Capitalist system to explain why the
capitalist socio-economic organism has been and still is evolving
in such predictable ways.

This booklet derives from the mind and heart of a person that
because of genetic factors, education, environmental
circumstances mostly beyond his control, has managed either
because of inclination towards fairness, or because of fear of
retribution, to follow the better rather than the worst instincts of
human nature.

Having an inquisitive mind, a certain ability for looking from

different points of view, for trying to understand the logic of cause
and effect and the dynamics of action and counteraction but also
a great capability to completely forget all names, dates and
specially all the small but interesting details that were an
important part in the formation of my opinions, all I was left with
has been a wide but fairly accurate assessment of the main
substance of most situations; like looking from the distance at
what is going on on this planet Earth . Therefore my lack of
memory for details has been a curse and a blessing at the same
time. Having been a tradesman most of my working life I have
acquired a certain practical common sense and if my head may
often be in the clouds, my feet are always firm on the ground.

I cannot call this work an "essay" because there are no notes or

detailed references as I have mostly assimilated most of what I've
read in my lifetime, also most of my opinions are primarily based
on my diverse life experiences. Looking at all the progressive
sites on the Internet one realises how many intelligent, educated,
and eloquent people there are analysing the present World's
situation; browsing on the Internet on the "Global Research" site I
came across an essay in five parts titled "Global Power and Global
Government" that I thought is really brilliant in facts and logic
with hundreds of notes and references that must have been real
hard work to research.

Unfortunately all these bright talented writers and researchers,

some young and full of energy, will add to nothing unless a
catalyst is found to unite them in a concerted effort to translate
this virtual Internet revolution into a real life mass movement of
people with computers or without computers who are the great
majority of voters. This will require a lot of organizing and hard
work amongst the people to awaken them from their
consumerism induced stupor.

salterre
 INDEX
PART I

The natural laws and mechanism of capitalist production.

Chapter IV– The Evolution of Western capitalist society.

Chapter V - The essence and origin of capital

Chapter VI - The capitalist cycle of production

and its basic elements.

Chapter VII - The market.

Chapter VIII - The essence of competition.

Chapter IX - Competition in the market and the law

of demand and supply.

Chapter X - Labour power - the living commodity.

Chapter XI - The natural antagonism between capital

and labour, profits and wages.

Chapter XII - The capitalist and profit.

Chapter XIII - Capitalism and the philosophy

of selfishness.

Chapter XIV - The mechanism of capitalist expansion.

 Chapter XV - The social and economic effects

of capitalist expansion.

PART II

The present stage of capitalist evolution.

Chapter XVI - General outline of the present

stage of development.

Chapter XVII - Export or perish.

Chapter XVIII - The armament trade.

Chapter XIX - Overproduction and market saturation.

Chapter XX - Consumerism: the development of consumer

credit.

Chapter XXI - Consumerism: advertising.

Chapter XXII - Consumerism : planned obsolescence.

Chapter XXIII - The transnational corporations

and their influence on the world economy.

Chapter XXIV - Clues about inflation.

Chapter XXV - Unemployment.

Chapter XXVI - Capitalism, impediment to

further progress.

Chapter XXVII - The sophistry of separation

and the influence of the media.

Chapter XXVIII - About superficial assumptions.

 PART III

A catalyst Movement.

Chapter XXIX - A simple philosophy.

Chapter XXX - Present situation in relation

to economic and social change.

Chapter XXXI - A new society.

Property, Time and Value

Work and leisure.

Democracy, Democratic process.

Education, The media.

Policing.

Chapter XXXII - Future prospects.

Chapter XXXIII - The democratic option.

PART IV

Socio-economic organisms.

Chapter I - Organisms and societies.

Chapter II - Social organisms.

Chapter III - Socioeconomic systems.

Letter to Mr. Bob Hawke in September 1983

Letter to mr. Kevin Rudd in October 2008

 PART I.

THE NATURAL LAWS AND MECHANISM OF CAPITALIST

PRODUCTION.

CHAPTER IV

THE EVOLUTION OF WESTERN CAPITALIST SOCIETY.

********

Looking at the last few thousand years, we can easily recognise

the main economic systems so far by which Man has procured or
produced the necessities needed to sustain his own life within a
group or a society.

In the previous chapter we have observed the evolution of Human

societies from the simple primitive communistic socio-economic
organism to the primitive democratic communities, to the more
complex civilisations with slave economies.

But in this discussion we are mainly interested in evaluating the

original factors in the evolution of Western European society after
the fall of the Roman Empire; from the slave economy to a Feudal
economy and then to the Capitalist socio-economic
organism. Previous to the advent of Feudalism in Europe, Roman
society gradually became more and more dependent on the work
of slaves for its economy, and on mercenary armies for its
defence.

The early Roman republic became powerful partly because of the

hardiness and loyalty of its free citizens farmer soldiers. It later
became opulent because of the many slaves and mercenary
armies; but, in the end, this increasing dependency on slave
labour and mercenary soldiers became one of the causes of its
decline under the pressure of more primitive and warlike nations
from the North and the East.

During its golden age Roman rule and arms had allowed the
Mediterranean nations to experience a long period of internal
peace. Land and sea travel had become safer, therefore
facilitating the spread of the new and revolutionary philosophy of
Christianity. Its ideas about Human equality found a fertile ground
amongst a multitude of slaves. We should not be surprised that
the early Christians were persecuted more than any other alien
religions by the Romans. In fact, like many progressive
Movements today, Christianity was a peaceful but revolutionary
movement as it was undermining the basis of the established
Roman economy and society they were preaching against slavery
and violence.

A freed slave very seldom could go far from his former master. A
man had to work to be able to live therefore a freed slave without
land often would become a servant or a sharecropper on his
master's estate. Although he was still dependent, his status was
improved and he would have more incentive and pride in his
work. This was one of the factors in the transition from an
agricultural slave society. Eventually, after initial resistance,
absentee landowners must have seen some advantage in freeing
their slave workers, besides being compelled by other factors. For
this and many more reasons, a society based on a slave economy
gradually became obsolete and decadent. As it became more
centralised, oppressive and bureaucratic, most of its citizens lost
the interest and the will to fight for its survival.

During the decline of the Roman Empire, because of incursions

from migrating barbarian Nations, themselves fleeing from Asian
invaders, inland communications became disrupted and
centralised government became more difficult. The work of slaves
became inefficient and expensive, having to be policed and
supervised. The burden of mercenary armies and taxes became
heavier, many towns and communities became isolated and had
to come to terms with the barbarians who became more powerful
and eventually overcame all resistance.

In time, as Roman society disintegrated, the invaders imposed

their rule over most of Europe, while at the same time they fought
amongst themselves for the control of the best regions. Europe
became a melting pot in which different nations, languages and
cultures were mixed together. This situation developed over a few
centuries the Dark Ages, a period of friction, adjustment and
assimilation.

During this time most towns and communities became isolated

and were enclosed within strong walls as there was no security in
the countryside for farming and trade. Force of arms became the
law.

But people had to survive; therefore, by necessity, within the

limits of their culture and primitive technology, they found a way
of producing and living adapted to such a precarious situation.
Gradually by compromise, new kinds of social and economic
relations took form, compatible with the new environment and the
new requisites for survival.

Feudal economy evolved from the shambles of slave economy,

and was influenced by the barbarians' primitive laws and customs
intertwined with the philosophy and traditions of Christian
institutions.

The early feudal system had a decentralised subsistence

economy. Almost every town and hamlet was a self sufficient
entity. There was little trade between them, and production was
primitive and slow. Because of isolation different customs and
dialects developed into separate cultures and languages.

In the larger towns artisans and merchants joined into their

respective Guilds and Corporations to regulate every aspect of
production and trade, to protect themselves against the
competition from within their own and from other towns and
districts. The feudal state was decentralised and power was
balanced between the king, the feudal chiefs, the Church, and the
burghers of the larger towns. The king was the head of the State,
he was supposed to rule by the right and will of God, therefore, he
was crowned by the head of the Church and had to appease the
religious institutions.

The king had to delegate power to the Church and the feudal
lords, and he depended on their loyalty. These, in their turn,
through their vassals ruled on the king's behalf over the lands
entrusted to them and over the people who inhabited them. The
common people could not leave the place of their birth. They
farmed the land allotted to them, and, moreover, they had to
work for their feudal superiors and serve in their armies when
required.

In the earlier troubled stage of the Middle Ages this situation

suited both the lords and the serfs: the stronger was the lord and
his castle, the safer were the common people from incursions and
raids; the more just and generous the lord was towards his
subjects, the more he could depend on their loyalty during his
frequent quarrels with the king or the other feudal neighbours.

Eventually, after much turmoil, feudal society and economy

crystallised into a precariously balanced system in which the
feudal lords were trying to be as much as possible independent
from the king, and the burghers in the towns were striving to
become independent from the lords. For the time being the king
and the people of the towns became natural allies as they had a
common interest to curtail the power of the feudal lords.

Gradually, the kings with the support of the towns became more
powerful and asserted their supremacy over large parts of
Europe. A degree of stability returned over the countryside.
Agriculture and trade began to prosper again, and, with a rise in
production, accumulation of wealth became possible.

Some of the new wealth was used in new ventures, but most was
expended within the courts and entourages of the kings, wealthy
feudal lords and merchant families.

This was the stage of the Renaissance: art and science started to
flourish again. In this situation, the power of the feudal nobility
and the system of feudal economy began to lose ground as the
environment that was the reason for their existence was
gradually changing. The beginning of a new system of production
and exchange, and the need for new social relations, began to
appear.

This was the beginning of Capitalism.

From the thirteenth to the fifteenth centuries Capitalism began to

develop in the merchant city-states of Italy situated at the
crossroads of East West trade. But from the fifteenth century,
after the discovery of the sea routes to the East Indies and the
discovery of America, the centre of mercantile power shifted from
the Mediterranean region to the Atlantic coast of Europe.

During this time the new system grew within the existing feudal
society. But the limitations of this society were an impediment to
capitalist expansion.

Permanence was the basis of feudal economy and society: the

conservation of old laws and customs; the restrictions on scientific
thought by an ossified centralised religious institution; the serfs
bonded to the land; the rules and conventions of the Guilds and
Corporations which stifled competition; the absolute rule of blood
nobility; personal property held in trust for the King.

The new capitalist system of production, on the contrary, was

based on continuous competition and change. It depended on
continuous innovation, new ideas and new technology. It needed
a mobile workforce that could leave its place of birth and move
freely to the new factory towns. It required a political power
structure, or law making process in tune with mercantile
requirements and open to whoever had wealth and ambition:
moreover, capitalist personal property had to be absolute and
inalienable.

The nobility generally despised the new rich merchants and

manufacturers, their former servants, but they appreciated their
wealth and their usefulness, and they could not ignore their
power for long. The Reformation gave justification and strength to
the rising mercantile class, and freed the bankers and money
lenders from the religious restrictions on usury and profit. In
England and other parts of Europe the process of change began
early. The nobility gave way, not without a struggle, to the new
economic forces. The capitalists obtained their share of political
power, and the nobility survived becoming capitalists themselves.

In France, on the other hand, the establishment remained

intransigent. The King, the nobility and the Church held fast to
their privileges and refused to allow any changes to the feudal
political structure, denying to the merchants and to the rest any
meaningful participation in the process of decision making. For
trying to hold back the times, they lost their heads in the French
revolution a capitalist revolution.

To sum up, this was the historical environment from which

Capitalism evolved: undeveloped Western Europe just emerging
from the barbarism of the Middle Ages; the growth of the towns,
improvement of communications and farming implements; the
Reformation, the relaxation of the laws against usury, the
development of merchant bankers; the Renaissance, art and new
scientific thought; the Mercantile Republics and City States; the
ability to produce a surplus of commodities that could be safely
transported and exchanged, this allowed the growth of the
division of labour which in turn raised production even further; the
changes in agriculture, commercial farming replacing subsistence
farming; the enclosure of land and the expulsion of small tenant
farmers, forcing an exodus from the country to the towns where
they became available labour power for the development of
industry; the discovery of new sea routes and new continents; the
formation of large kingdoms and the polarisation of national
identities; men of arms became less important in relation of men
of industry and trade.

This was not just a point in history, but it was a process that took
shape unevenly over the centuries. Within this process the
embryo of a new system of production and exchange began to
evolve, and with it new political forces and a new culture began to
emerge. What made this process possible was an empty
expanding environment and an expanding population, plus a
situation of almost total scarcity that required to be overcome
and satisfied. For the merchants there was a growing potential to
gain from local and new far away markets, and the potential of
innumerable new commodities that could be produced to satisfy
these markets. It was this fertile expanding environment that was
essential for the birth of Capitalism.

It is evident that an increasing availability of markets has always

been the main requisite for capitalist production and expansion. If
personal self interest and the acquisition of wealth were the main
motivation and objective for the capitalists, the satisfaction of
market demand was the original means by which they proposed
to promote them.

From the beginning, we can observe a special feature of

Capitalism which is the basis on which the system rests: it is the
trust of the manufacturer, the merchant, the State in the banker,
the manager and manipulator of their money. Most important of
all, we can observe how in the hand of the banker, because of this
trust, money becomes a commodity in itself: a special commodity
that can be created like an illusion. An illusion that spurs people
to produce more, and it is by this extra production that the
illusion becomes a reality. Therefore, the banker can create more
money, a letter of credit, a promissory note, a greater illusion, a
greater gamble that in turn is translated into more commodities,
and so on.

In this chapter I have tried to observe in a short but wide profile

the accelerating development of Human history in just one region
of our planet; I have tried to observe the main changes in
Western Society and economy; From the imperceptible and slow
evolution during the primitive stages, to the fast changes of the
Industrial Revolution.

It is evident that the world has never stood still. What becomes
obsolete and an impediment to Human survival and progress
must give way, and let the process of evolution continue.

It should also be evident that Capitalism has evolved from a

situation of scarcity, slow production and great opportunity for
population and market expansion. As the system has evolved it
has developed its own laws and a mechanism that were especially
suited to this early situation. It has now almost completely
changed the environment of its birth, the environment in which it
could develop.

That early situation no longer exists, and capitalism has become

obsolete, it can no longer rationally function, it has become
wasteful and destructive: an impediment to further meaningful
Human progress.

In the following chapters I will endeavour to show the evidence for

these assertions.
 CHAPTER V.

THE ESSENCE AND ORIGIN OF CAPITAL ACCUMULATION.

********

Before we start examining the main features of the present

economic system it is important that we consider first what
constitutes a capital, and what have been the most important
factors in its accumulation and rapid development during the last
three centuries.

Adam Smith (l723 1790) in his analysis of Capitalism explains

that capital is a previously accumulated stock of goods and
commodities being employed to produce more commodities.

Capital stock is anything which has the potential of commanding

or buying labour. For example one could accumulate enough food,
clothing, tools, or their equivalent value in money to maintain or
pay one worker to work and produce commodities for one year;
this stock of materials or money can command a quantity of
labour, but it produces nothing to his owner if it is left idle. This
capital can produce a profit and grow only by the employment of
labour to produce commodities that can be sold for profit on the
market.

For simplicity sake, without entering into philosophical

arguments, we could say that capital is a quantity of previously
accumulated materials, or their equivalent value in money, being
used in production. This should be enough for the scope of this

Let us now have a brief look at the origins of capital and the main
reasons for its rapid development during the last three centuries.

In his analysis of the capitalist system (An Inquiry Into The Nature
And Causes of The Wealth of Nations), Adam Smith is mainly
concerned with the explanation of its natural laws and mechanism
as they had evolved. But he makes a few statements which leave
no doubts about what he thought was the origin of capital
accumulation.

He simply states that before the division of labour and further

accumulation of capital "there must be a previous accumulation
of stock." He states that previous to the appropriation of the land
and accumulation of stock the produce of labour belong wholly to
the labourers, they had no masters or landlords to share it with,
but

"....this original state of things could not last beyond the first
introduction of the appropriation of land and accumulation of
stock....As soon as the land of any country has all become private
property, the landlords, like all other men love to reap where they
never sowed and demand a rent even for its natural produce....As
the accumulation of stock must, in the nature of things, be
previous to the division of labour, so labour can be more and
more subdivided in proportion only as stock is previously more
and more accumulated.... "

The land in itself can be considered to be capital because it

provides subsistence, and, therefore, whoever owns the land can
command labour. The appropriation of land was one of the main
factors which opened the door to the accumulation of capital and
the division of labour. Without it Capitalism could not have
developed.

Another essential factor in the development of Capitalism after

the appropriation of the land by a minority, was the consequent
forced exodus of the majority of peasants from the land their
only means of subsistence. The result was the division of the
population into proprietors of land and capital at one end, and
destitute free labourers at the other.

The peasants under the feudal lord, although they had the status
of serfs, were his wards. In theory, he was responsible to the King
and ultimately to God for their well being. Moreover, the lord in
theory had no more right than his serfs over the land entrusted to
him; the King had the ultimate right over the land.

This relation and feudal covenant was broken. The labouring serfs
were set free from their bondage, and the feudal masters took
possession of the land repudiating all responsibility towards them.

The freed serf had to look after himself in a world where the land
had been fenced off and had become private property. He could
only walk along the roads looking for work wherever he could find
it, looking for a benefactor willing to employ him. It is the degree
of one's control over the land and the other means of production
that determines one's degree of freedom and equality.

How did this separation of the labourer from the land and the
means of subsistence come about?

The story that most capitalists sycophants are always keen to tell
about the accumulation of wealth and the origin of capital is
that...in the beginning all people had the same opportunity, but
only a few industrious people by hard work and sacrifices became
rich and wealthy; the rest were less industrious and wasted their
opportunity, therefore they became poor; eventually the poor to
survive had to depend on the good will and generosity of the rich
to be allowed to work for them in return for the price of their
subsistence.

If we accept this story we must believe that only ten percent of

the world population are honest hard working Human beings,
while the rest is composed of lazy idiots; and in this number we
must include most of the geniuses, inventors, explorers, etc. who
very seldom were good businessmen. It is not so much
intelligence, wisdom, education or hard work but it is mainly the
cunning and business sense of the merchant that are most
essential for material success in capitalist society.
In reality the fact is, as Adam Smith stated, that the appropriation
of the land had to be effected and the separation of a mass of
people from it had to be under way before capitalism could
develop further.

Amongst all the factors that we have mentioned earlier, in the

evolution of Capitalism from feudal economy, there are some that
deserve to be mentioned again. The basis of the strength of the
feudal lords against their rivals had been the number and loyalty
of their subjects. But, with more stability and peace, they did not
need any more a big population on their domains. At the same
time a revolution in technology and the opening of new markets
was causing a revolution in agriculture. It became more attractive
for the feudal lords to change the use of the land from open field
subsistence farming to large scale commercial farms, and to
enclose large tracts of land for pasture and sheep grazing to
supply the growing woolen industry.

There is plenty of historical evidence about this process. While it

increased agricultural production and wealth, it increased also the
poverty of a large part of the population, and their dependence on
industrial development. This did not happen at once, but at
different stages in different parts of Europe.

It was this process that was the basis for the accumulation and
development of capital. Not the idyllic tale of hard work and self
denial of the capitalist apologist, but a documented story of
greed, ruthlessness and misery. This is generally speaking and
with few exceptions the genesis of capital.

Eventually, the wiser and more liberal capitalists themselves had

to devise laws to limit the degree of exploitation of the common
people, even laws to protect children from the greed of their
employers and the necessity of their destitute parents.
In Europe, Capitalism had to wear a Christian mask; but the mask
was dropped without shame by the capitalists in their dealings
with colonial nations of different race and religion.

Further evidence that the accumulation of capital could not take

place without abundant cheap labour is found in the fact that in
North America, where land was cheap and available to all, a
nation evolved of strong and independent small farmers. Large
commercial landowners had to use slaves, and industrial capital
did not develop to great extent until after the Civil War. Only on
the eastern coast of the United States, the staging area of
European migration before its march towards the West, we see
some early industrial development, and the wages of labour,
there, were well above those in Europe.

To overcome the problem of the scarcity of wage labour in parts

of Australia, Wakefield's plan of systematic colonisation was
adopted by England in the nineteenth century: the price of land
was made artificially high to force poor migrants to work for those
who had capital, at least until they could save enough to buy their
own land.

Capital needs labour, if labour is scarce it must be created either

by denying the use of the land, and therefore the means to be
independent, to the majority of people, or by forced labour and
immigration.

Generally speaking, a man may become modestly rich and

comfortable in his lifetime by his own hard work and sacrifices,
but only by employing directly or indirectly the labour of other
people to produce more value than they are paid in wages, or by
the forced labour of slaves, could large capitals be produced and
accumulated.

This is, in the main, how capital evolved from the appropriation of
the land and from the early stocks of the merchants and usurers
of the Middle-Ages.
 CHAPTER VI.

THE CAPITALIST CYCLE OF PRODUCTION

AND ITS BASIC ELEMENTS.

********

As we have seen in the previous chapter, the appropriation of

land was one of the essential conditions for the development of
the capitalist system. All the land became the property of a
minority and of the Crown. This appropriation was the main origin
of the accumulation of capital. The majority of people were left
without any land therefore they were left without the means of
supporting themselves. They had to find employment for wages
wherever they could find it.
In theory it could be said that Capitalism is a socioeconomic
system in which those people who own capital, by employing the
labour of those who do not, produce commodities and services
which they sell for a profit in the market of Human society.

The capitalists compete against one another in the production

and in the sale of the commodities. Those who are successful in
selling their products will make a profit which they may use as
they please. But, to become more competitive and to survive in
the market, they must use a part of their profits to increase their
working capital to improve production.

Capital, to produce any profit must be invested. Idle capital is not

worth any more than the ink on a ledger.

This seems to be a simplistic explanation of the capitalist system

of production; but, in reality, the most complex situation, when
broken down in its component parts, can be reduced to similar
simple terms. The reason is that every situation derives from the
same simple laws that we will try to examine in this part of the
discussion. Of course, there are different forms of Capitalism in
the World. These have been determined by different
environments and different historical and cultural backgrounds;
but if we keep these factors in mind, we will find that the laws and
mechanism of the system are much the same.

Let's look separately at the different elements in the spiral of

capitalist production.

Capital is the first element, end we have discussed some of its

main aspects in the previous chapter.

Then we have labour power, without which capital cannot live. In

the process of capitalist production, labour is considered like any
other commodity; but it is also a Human being who can be forced
to the labour market only by incentives or by necessity. This is
the main reason why we cannot separate the study of economics
from the study of History and sociology, and this is why our
present 'dry rationalist' economic experts in the service of our
blindly selfish business class are making such a mess of our
society.

Another element is the competition between capitalists to lower

the cost of production. This is the dynamic element which does
not allow them to stop or rest in their expansion, their search for
new methods of production and new markets; Continuous
expansion and development that in the end must lead to
saturation.

Then we have the commodities and labour markets. And, finally,

we have profit. This is the most important element for the
capitalists in the spiral of production. It is the main motivation and
purpose of all their activities, and without profit most capitalists
would rather let society to disintegrate; all their patriotism would
quickly evaporate.

Each one of these elements has its own particular nature and
force.

Capital and private property contain the essence of capitalist

strength. In labour is deep rooted the antagonism of alienation,
and the latent power of the majority of society. Competition is the
dynamic spring of expansion and the force which determines both
the creation and the destruction of wealth. In individual personal
profit are the seeds of ruthlessness, greed and short
sightedness. The interaction of these forces in the process of
production and in the markets of society produces definite trends
and contradictions which are natural to the system. These forces
direct the development of capitalist economy and society; they
cannot be controlled or suppressed for long. They always manage
to surface and direct the course of the economy, independently
from the wishes of society in general or of those who seem to be
in control.
We could say that in the system there are elements that could be
considered to be almost mechanical: these function in a
predictable way. They form the main part of the mechanism of
the system with definite laws and logic, the market and
competition are two such elements.

Profit and labour power are different from them in the sense that
they are closely related to Human beings. In this respect they
tend to follow a twisted path: their reactions are more difficult to
foresee because, although they are motivated by the instinct of
survival, they are affected by our Human passions and our
ignorance, with all their variations of prejudice and
fear. Therefore, we should start by examining the features of the
capitalist market, the stage towards which all activities gravitate.

CHAPTER VII.

THE MARKET.
 ********

The capitalist market has no definite place, form or time. It is

everywhere in the world, and goes on all the time. It is anywhere
anything is sold or bought, where deals and contracts are being
made and profits or losses are produced: the markets, the stock
exchanges, shops, bars and restaurants, boardrooms and
bedrooms. Anybody in the world who wants to buy anything at all,
and has the means to pay for it, will find his counterpart:
somebody who is eager to satisfy those needs and wants for a
price and profit.

In this capitalist market most people are buyers and sellers at the
same time. The market is not really a place people are the real
market; People who are potential customers and traders because
they have something of value to each others to exchange. This
excludes the poor people of the world whose work is not needed,
and, consequently, are pushed aside or ignored.

Therefore, in the context of capitalist economy, the market

consists of those people or countries that have the means to pay
for commodities and services, or that have anything else of value
to the capitalists that can be exchanged for those commodities
and services and produce a profit. Their demands can be satisfied
because they have the means to pay. This is what capitalist
economists call the "effective" demand, opposite to the
"absolute" demand which includes those who cannot pay and for
this simple reason cannot be satisfied.

Our fashionable 'dry' economists only consider the "effective"

demand in the market. Poor individuals and poor countries cannot
be considered to be a market in the capitalist sense. They are the
beggars outside the scope of capitalist production, and they will
stay so, dependent on charity, until the capitalist may find in
them something of value to himself by which he can make a
profit.
This is the first reason why, while Capitalism today can over-
produce, over-supply and over-satisfy the effectual demand of
those who are already rich, it cannot satisfy the absolute demand
of the poor and unemployed people of the world. Rather than give
the surplus products away without a profit, it is forced to cut down
production or to waste its productive forces in some other way.

It cannot be stressed too much how important the market is to

the capitalist in the spiral of production. All the profits flow from
the market. This importance is reflected in the status and the
salaries of marketing and advertising managers and consultants
in the hierarchy of capitalist business; they seem to be more
important than scientists, engineers and production managers.
Production is subject to the "effective" demand of the market.

The market has evolved naturally from the needs of Human

societies.

In primitive economies, people traded their products and wares

by direct barter. In the more complex economies, money is used
to facilitate trade, and money represents the value of the
commodities produced. Therefore, the use of money in trade is
still in essence a more practical form of barter.

In the early stages, money was itself a commodity: something

that was of general and practical use and in great demand, like
metals, cattle or salt, their value being easily related to the value
of other commodities.

Money is a Human invention, a product of our ingenuity. But in

our mercantile socioeconomic system the early concept of money
has been perverted. We think of money as something above
everything in life, not just as a medium to facilitate trade. We
have become so much enslaved by our own invention that we
have lost our sense of perspective, even to the point that in a rich
land people may be forced into idleness and poverty because
there is no money, we must mortgage our souls and birthright to
borrow it.

To suit the interest of a minority, money, a useful medium that

facilitates production and exchange, has been turned into a
commodity the most important commodity of all, even more
important than labour.

This is an illusion, but we believe so much in this illusion that it

has become a reality. Like a psychosomatic illness it is all in the
mind, but its results and effects are real and devastating.

For over three centuries we have been gradually conditioned to

accept as the law of Nature the peculiar logic of the merchant
class, a minority in our society, and by blindly following this logic
we have gone past the limits of rationality. The direction of our
economy has been determined by the preposterous pretence that
for our own good everything must be subjected to the law of the
merchant. We are trapped in a deadly game of make believe in
which the merchant makes the rules. World bankers today are not
trembling so much for having to lose their loans to the developing
nations, but more because of their fears that their trick of
confidence may be found out, and their irrelevance may become
manifest.

It is unfortunate and also tragic that we may never find a rational

solution to our present problems. How can a generation of Human
beings, born and bred in a madhouse environment, recognise
sanity and common sense? For the transient and doubtful benefit
of a section of society who unconsciously has promoted the
mercantile concept of money, we are now sacrificing entire
generations. And those wretched people who have no money at
all are often the most fanatic believers in this illusion.

There is a passage in Adam Smith's "The Wealth of Nations" that

capitalist economists have forgotten:
".....the real price of everything,....is the toil and trouble of
acquiring it....What is bought with money or with goods is
purchased by labour as much as what we acquire with the toil of
our own body. That money or those goods indeed save us this toil.
They contain the value of a certain quantity of labour which we
exchange for what is supposed at the time to contain the value of
an equal quantity. Labour was the first price, the original
purchase-money that was paid for all things. It was not by gold or
by silver, but by labour that all wealth of the world was originally
purchased....."

In the feudal system the market was regulated and strictly

controlled, but, as capitalism developed, a free enterprise market
began to take shape.

Unfortunately, the ideal of free competition in a free market, that

Adam Smith defined and advocated in his analysis of Capitalism,
could never become a reality. Greed, ignorance and fear have
been too strong, and free competition without restraints (?!)
inevitably leads to confrontation and war.

In the good old days of free enterprise, during the Industrial

Revolution, the law of the jungle took over: the strong and
powerful took all the freedoms, and the weak were enslaved or
destroyed.

Given the dynamic nature of competition, a free market cannot

remain free for very long. It is a contradiction, and it will remain
an illusion.
 CHAPTER VIII.

THE ESSENCE OF COMPETITION.

********

It is not within the scope of this discussion to deal with the

competition for survival which exists in the world of Nature (the
law of natural selection).

The competition we will discuss in this booklet is that between

Human beings. Although it originates from the same natural law,
it has assumed different aspects and different qualities.

The competition of living organisms like animals and plants takes

place in a natural environment. It seems to be completely
instinctive, without the Human handicaps of greed, ignorance and
hate.

If living things, other than Humans, have no consciousness, then

their competition must be motivated by pure and simple natural
instinct, not ignorance. If, on the contrary, they are conscious
beings, then it could be that their consciousness may even be
complete and they may be motivated by a greater wisdom than
ours. But this is only an hypothesis.

It seems to be evident that Humans, whether by the act of a

superior Being, or by natural evolution, or by a fortuitous chance,
from an instinctive state they have become conscious of
themselves and their environment.

But it is also evident that this consciousness was very limited and
cloudy. It was the beginning of our questions and our attempts to
answer them. The answers, mostly incorrect, that we gave
ourselves, have influenced the course of our development. It
could be said that in acquiring our imperfect consciousness we
became ignorant and we lost our instinctive wisdom.

If this was the case, we must endeavour to acquire the knowledge

which may give us wisdom without having to revert to our
primitive form of life. This may take a very long time. Therefore,
our prime task is to ensure the continuation of Human life so that
in the future we may be able to find out about ourselves and the
reason for our existence.

This digression may help to explain my opinion that competition

in our present contrived socioeconomic system, outside the world
of Nature, instead of promoting the fittest for survival, may
actually promote the fittest for destruction. Because of our
ignorance and our lack of wisdom, the successful survivors in the
narrow artificial world of capitalist society may not have success
in surviving in the wider world of Nature.

In Human society, competition is a contest for survival. Its form

and intensity are determined by the type of the society and the
economy. When there is ample space and opportunity for
everyone, competition can be contained within ethical and even
friendly terms; when someone is about to lose, one can survive by
moving to other areas or other fields. When there is ample
opportunity for expansion, there is little competition. But one of
the main features of capitalist economy has been an
uncontrollable growth, and now, with space and opportunity
continually decreasing, competition is continually increasing.

When the possibility of defeat becomes apparent, the contest

becomes a question of life and death. Therefore, it becomes more
ruthless, and gradually it overtakes all ethical or moral
considerations. In the fight to survive from day to day, Humanity's
future prospects become secondary.

The logical final result of this contest is open or hidden warfare,

and war has no limits. One of the contestants may win, or all may
be ruined and become losers. If only one winner remains, then
competition stops all together. If the contenders, rather than face
ruin, compromise and come to terms, real competition stops, and,
only the appearance is maintained by fictitious forms.

In our economy there is always the pressure to compete, and at

the same time the necessity to come to terms.

In short, we could say that competition is a contest between

opponents that gradually develops into ever more intensive
stages. As the prospective result is the eventual victory of one of
the contenders and the defeat of the rest, the ultimate stage of
competition is war. The higher the stakes, the more ruthless and
unethical will be the means that will be adopted by the
competitors.

The alternative to this last stage is the termination of

competition: the contenders, rather than risk destruction, come
to agreements or buy each other out.

As we have said before, in the last stage of competition all moral

and Human considerations become impediments, and,
consequently, it is not necessarily the best and the more honest
contenders, but rather the more ruthless and cunning who may
win the contest for survival in capitalist society. It seems to be
evident that in our competitive society ethical standards are
under continuous pressure, and continually tend to deteriorate.
What may not be permissible at one stage may become a virtue
later on: the society will tend to become increasingly hard and
divided, people will become isolated.

While competition in a natural environment may be beneficial

towards our survival, it may become suicidal in an irrational
situation fraught with a doomsday technology.

These are brief and general considerations on the essence of

competition; this is a common sense appraisal that our 'free
market' economists seem to have replaced with their illusion of
the fair and "even playing field" of the "free market".

Next we will try to examine the competition in the market within

the cycle of capitalist production.

CHAPTER IX.

COMPETITION IN THE MARKET

AND THE LAW OF DEMAND AND SUPPLY.

********

As we have seen earlier, it is in the nature of capitalist economy

that capital must continually chase after profits. When a
commodity is scarce and, consequently, is in great demand, some
people may be willing and able to pay more for it. Therefore, the
producers can raise their prices and make more profit from their
sales. This is the main cause of what economists call "demand
inflation."

Such a situation attracts more capitalists to invest their capital in

the production of such commodity.

Eventually, with the consequent rise in production, the demand

becomes satisfied and prices and profits begin to fall. At this
stage the competition of the capitalists to stay in business to
produce such a commodity becomes more intense. In their efforts
to lower the cost of production, they are forced to find new
methods and new technology to produce cheaper and in greater
quantity. Thus they aggravate their own problems by creating an
oversupply of that commodity. Prices and profits fall even further,
and in the end it becomes unprofitable for some capitalists to
continue production.

Capital begins to fly away from this field of activity. Some

capitalists are ruined by competition, some shift their capital to
other fields where there is a scarcity, a greater demand, and
profits are higher

Therefore, as capital continually chases higher profits, it

continually moves from one field of production to another where
there is a greater demand.

This continuous fluctuation of capital from one point to another

causes a continuous fluctuation in the production of commodities:
from under production and scarcity to over production or
abundance, with consequent fluctuation of prices, higher when
there is a scarcity, lower when there is a glut.

The Japanese capitalists have perfectly understood and taken

advantage of this law. As they, contrary to our capitalists, have a
long term plan for their economic development, instead of playing
monopoly with their savings, they have invested heavily all over
the world in the development of the production of those
commodities and raw materials of which they are lacking.

Now they have 50 percent interest in mines all over the world;
they have created a glut, from these mines they have imported
stockpiles of raw materials. Now they can sit back and when the
contracts are re-negotiated they can dictate the price that they
will pay for the raw materials. They can watch mining companies
from different countries undercutting each other, increasing
production, trying to obtain concessions from their governments,
cutting down their work forces to maintain their diminishing
profits.

By creating a glut, they have created a buyers’ market; they may

get small profits from their investments, but they are getting an
enormous advantage by the lower price of the raw materials
essential to their economy. Now they are doing the same with
other commodities. In a saturated competing market the sellers
are at the mercy of the buyers. What will the sellers do next to
overcome such an intolerable situation in which they find
themselves?

In a free market, prices are supposed to continually fluctuate from

above the cost of production to below the cost of production. But,
in the long term, their average should come close to the real cost
that Adam Smith calls the natural price of commodities:

"..Market price is regulated by the quantity brought to market and

the effectual demand.

When the quantity brought falls short of the effectual demand,

the market price rises above the natural; when it exceeds the
effectual demand the market price falls below the natural; Natural
price is the central price to which actual prices gravitate...."
This, in general terms, is the law of demand and supply which is
the natural and self regulating mechanism of the capitalist
market.

The law of demand and supply is also the mechanism which

automatically regulates the type and quantity of commodities
produced, and their share and distribution amongst the various
sections of society. .

When a commodity is scarce and in great demand, its price

increases, therefore, it is the ability to pay for the commodity, not
real need that will automatically determine who will be able to
acquire it and who will have to go without it.

It is the effectual demand or the ability to pay, that will also

determine which type of goods and services will be produced in
preference. Consequently, expensive buildings, luxury goods and
services for the richer sections of society may have the priority
over the necessities of housing, health and education for the rest
of the general public.

Without any plans, the capitalists while chasing higher profits are
continually attracted towards producing those commodities which
are within the effectual demand of those who can pay for them.
Without any malice, the real needs of a society may never be
satisfied if there is no profit for the capitalists. This is one of the
general causes why the rich tend to become richer and the poor
tend to become relatively poorer there is more profit in
producing luxuries for those who can pay, than in producing
necessities for those who cannot.

As we have said before, as soon as the demand becomes satisfied

and there is overproduction at one point, profits start to decrease
and capital, therefore, starts flowing away from this point to
another field where there is a higher demand and higher profits.
In this way, with all those fluctuations, capitalism manages to
keep satisfied the effectual demand for all kind of commodities
and services required by those who can pay for them.

Most of this movement of capital takes place through the banking

system and through the stock exchange markets. There, the
capitalist investors, speculators and gamblers shift their savings
or shares from one point of production to another where they
think the profits will be higher.

So far we have considered the law of demand and supply as it

would apply in a free market, but, it seems evident, there is not
such a thing as a completely free market. In fact, monopolies,
cartels, trade unions, business and professional associations,
have developed to control production and the commodities and
labour markets. Their objective is to bend and exploit the law of
demand and supply for the benefit of their particular sections of
society. It is the interest of each individual in the market to buy as
cheap and to sell as dear as possible.

When the capitalists enter into competition, they cannot stop,

they are forced to escalate, and they must end either by winning
or losing the contest, or, alternatively, by coming to terms with
each other and limiting their competition. Generally speaking, this
is what happens most of the time.

Continually harassed by competition, the dream of the capitalist is

to become the only producer and the only seller in the market.
While he professes his faith in free enterprise and the free
market, to be able to survive he is eventually compelled by
competition either to eliminate or to join the opposition. As a
buyer of commodities he clamours for free competition amongst
the producers, at the same time, as a producer, he must do his
best to reduce or eliminate the competition.

This natural tendency to form protective associations has always

been present. Some of the bigger capitalists by forming
monopolies, cartels, corporations, they can control the quantity of
certain goods that are produced or brought to market, and they
can set their prices to "what the traffic can bear", which means
the highest price possible without destroying the market.

The control of production and of the market increases the

opportunity for maximising profits. A monopoly that controls
production has a great advantage, but one that controls the
markets (the selling outlets) is in a much better position because
it is in the middle between the producers and the public. By
controlling the selling outlets, a monopolist can force the
producers to deal on his own terms. At the same time, by
rationing the supply to the consumers he can force them to pay
the highest prices that they can afford. In his dealings, the only
brake to his exploitation of the producers and the public is the
consideration that he may kill the gooses that lay the golden
eggs.

In reality, free enterprise and free competition in the market are a

contradiction because in the end they must lead to monopolies or
agreements.

This is one of the reasons why capitalist governments,

notwithstanding their commitment to no interference in economic
matters, are forced to intervene with laws and regulations
designed to protect some capitalists from the monopolies or
unfair practices of the others. But, in the end, most governments
become the captives of the economic power of the big
monopolies and corporations.

Those capitalist economists and politicians that advocate

deregulation would do well to examine the records of the reasons
why regulations were adopted in the first place in the years past.

Complete free enterprise and competition eventually lead to the

law of the jungle. The nature of the system compels the capitalist
to try to become a monopolist and to eliminate the competition
which cuts into his profits and threatens his survival in the
market.

It should be evident that the same pressures and logic of the

commodities' market also apply to the labour market. The law of
demand and supply applies equally to labour power because, in
the capitalist system, it is a commodity like any other to be
bought and sold, and used in the production of profit.
Unfortunately for the capitalists, it is a commodity which is
embodied in Human beings it is a commodity that can act in its
own defence.

All workers, from the labourer to the scientist, are very much
conscious of the law of demand and supply. They know that when
they are in abundant supply, the price for their labour must
decrease, even below the poverty line during a recession.

Consequently, most working people join into trade unions or

political and professional associations to try to bend the law of the
market in their favour. They try to keep their numbers down, and
they join forces in their disputes against their employers. It could
be said that the professional associations of lawyers, doctors,
architects, etc. are fairly successful monopolies, most trade
unions, on the other hand, are not very successful.

In the market, those who have the advantage extol the virtues of
free enterprise and competition; those who have not will cry
about unfair play and will ask for protection.

It was from their position of advantage and technological

superiority that, during the previous centuries, the industrial
countries with their gunboat diplomacy advocated and 'enforced'
free trade on the undeveloped countries of the world. The Opium
War against China is a typical example of the type of free trade
practised during the Industrial Revolution in the good old days of
free enterprise.
In conclusion we could say that the dynamic combination of
competition in production and in the market is the main
mechanism of capitalist development and expansion. From this
mechanism originate the compulsion towards monopolies and
corporations, the accumulation of capital in ever fewer hands, the
explosive development of technology, and, in the end, the
saturation of the market, and the transformation of the economy
from the servant of society to its ruthless taskmaster.

One more contradictory feature which derives from the law of the
market is the logical preference the capitalists have for an
environment of abundance where they buy their raw materials
and labour, and an environment of scarcity where they sell their
commodities. They need a continually expanding environment: an
increasing number of people rich enough to buy their products,
and a great number of people poor enough to be willing to work
for them.

Capitalism to survive needs to maintain the environmental factors

that brought it to life; The nature of the system will prevent
Capitalism from satisfying all the needs of society, no matter how
rich and productive its forces may become. No sooner a need may
have been satisfied another one must be created to stimulate the
market.

The market is no longer a means to satisfy the needs of

society. The sway of the merchants over the last three centuries
has perverted the situation: Human society must be sacrificed to
satisfy the needs of an economy oriented primarily to satisfy the
needs of their mercantile class. If everybody had enough and was
satisfied, the capitalist would not be able to increase his sales and
continue to make a profit, and he would find difficult to get
anybody to work for him: the complete satisfaction of the needs
of the society would put him out of business. This perversion
cannot be rationally resolved within the capitalist socio-economic
organism.
 CHAPTER X.

LABOUR POWER THE LIVING COMMODITY.

********

Profit making is the main purpose of all capitalist activity in the

capitalist cycle of production. But to obtain this end, the capitalist
must invest his capital by employing labour in the production of
goods and services to be sold in the market.

It would be hypocritical for the capitalist to complain about the

risks he is taking for 'the benefit of the public' and to expect
unreasonable returns for his alleged troubles. Nobody is forcing
him to start a business, this is what he likes to do, and by this
trade he earns his living. If he did not invest his capital either by
himself or by lending it to somebody else, eventually he would
have to find another way to survive.

It is self interest, not concern for society that drives the capitalist
to employ labour. He will discard the labourer as soon as he has
no more use for him, and he will decline any further responsibility
for him.

Labour is the origin of all wealth, and, as it has been essential for
the first accumulation of capital, so it is essential for the
continuation in the production of all profits.

It is Human labour in the first place that transforms inanimate

materials into commodities and services, and it is labour which
takes them to market. Therefore, the capitalist must employ
labourers. By labourers we intend anybody, whether a manual
worker, tradesman, people in the professions, etc. who works for
wages, salary, or on contract.

The capitalist does not buy the labourers, this would be slavery.
He just buys their labour power for a definite amount of time, at a
definite price.

In cold economic terms, labour power for the capitalist is a

commodity not very much different in substance from the labour
power of an ox or a donkey. Its price ( wage, salary, etc ) is
subject to the law of demand and supply; but labour power, which
is the most important of all commodities, is also a Human being
who, although he may not have any business sense, may be more
intelligent and sensitive than the capitalist who employs him.
Moreover, a Human being can only be forced to the labour market
either by incentives or by necessity.

Since the beginning, the capitalist have appreciated the

importance of the labourer more than the labourers themselves.
John Bellers (1654,l725) pointed out that the richest man, if he
had no labourers, would be just a labourer himself, "... and as
labourers make men rich, so the more labourers there will be, the
more rich men. . . . the labour of the poor being the mines of the
rich."

Bernard de Mandeville (1670-1753) was even more explicit:

" . . . .it would be easier, where property is well secured, to live

without money than without the poor; for who would do the
work ?" He goes on defining what has been the dream of the
capitalists from the beginning to the present day: a multitude of
"labouring poor ", not so miserably paid that they may rebel, nor
so well paid that they may not be continually in need to be
employed; always in plentiful supply to fulfil the needs of armies
and navies, and always kept in blissful ignorance, contented with
their lot.

This philosophy has determined the industrial, economic and

social policies of the capitalists in government.

As we have seen before, one of the main conditions for the

development of capitalist economy was the improvement of the
methods of cultivation, the enclosure of great tracts of land for
pasture, the gradual appropriation of all cultivable land, including
most of the common land, by the nobles and the wealthier
landlords.

This gradual process, together with the displacement of the

primitive "cottage industries" by the advance of technology, set
free most of the rural population from the country to the towns; a
growing labour army in need of work, ready to satisfy the needs
of an expanding capitalist industry. Without any land, the people
had to find work in the new factories in order to survive.

Few people would work for a master if they had the opportunity to
work for themselves and be self sufficient. To attract such people,
the capitalist employer would have to raise the conditions and the
wages of labour, and, consequently, lower the profitability of his
invested capital.

This is one reason why it is essential in capitalist economy that

the land be almost completely the property of a minority, and that
its price be relatively high, in order to compel the majority of the
population to work for wages.

In a large country, during a depression, if the land was cheap we

could see an exodus of unemployed people from the towns to the
countryside. This would be a very effective method of
decentralisation; but would the capitalists be happy to see a part
of their reserve of unemployed labour disappear from the market?

Adam Smith stated that labour, not gold and silver, is the origin of
all wealth. He stated that labour "was the first price, the original
purchase money that was paid for all things." There cannot be
any doubt about this; therefore, labour is itself real capital
because it is the origin of capital; therefore we could say that
people are capital because they possess labour power (or labour
potential). The people and the land are the real capital of a
country. We could say also that unemployed people are wasted
labour power they are wasted capital.

Unfortunately, the majority of workers, whether labourers or

professional people, have very little consciousness of their
potential, and the capitalists have a vested interest in keeping
them as confused as possible. Adam Smith's assessment of the
labourers, ".. those who live by wages", is still valid today :
". . But though the interest of the labourer is strictly connected
with that of the society, he is incapable either of comprehending
that interest, or understanding its connection with his own. His
condition leaves him no time to receive the necessary
information, and his education and habits are commonly such as
to render him unfit to judge even though he was fully informed..."

The capitalists naturally believe that money and property are

capital and Human labour is only a commodity that cannot be
utilised without first acquiring capital. Having obtained
supremacy, the capitalists in two centuries have gradually
convinced the population that there cannot be life without capital;
they have imposed on society their own particular mentality and
values - the particular logic of the merchant class has become the
law of the land.

Capitalists resent the fact that in the production of profit they

have to depend on such an unstable and intractable living
commodity as labour power, a commodity that can fight for its
own protection. Therefore, they have been competing with one
another to eliminate labour from the process of production; but
this trend will produce the necessity to eliminate "people" as they
become redundant and become a burden to those who are still
employed.

Today, with new technology and industrial robots, capitalist

businessmen may succeed in realising their wish; but this
achievement will either precipitate the collapse of capitalism or it
will push the system from the present stage of irrationality into a
new stage of complete madness. What good is it to a society to
increase production by automation if the majority of the people
will not be able to buy the products because they will be out of
work? Will these products be sold on foreign markets if the
foreign countries are either in the same situation trying to sell
their own products, or are too poor to buy anything at all?
This is probably one of the reasons why in this country during the
eighties all the money saved by cuts in government spending and
wages restraint was squandered by our entrepreneurs in playing
'Monopoly' in the stock market and by conspicuous consumption.

Merchants are not as stupid as our politicians are. Why undertake

the hard and risky work of investing the country's capital to
modernise our industries and increase production with the
uncertain long term prospect of some profits in a saturated and
lop-sided world market, when, with the help of fools in
government, with the incentive of an indiscriminating 'negative
gearing' tax saving device, with the help and cheers of their
castrated economic experts and mignons in the Media, they could
get rich quick in a gamble of double or nothing in the world's
stock markets ??? They could not lose, at every raise of the stakes
some of the country's capital stuck in their pockets.

Why is it that these business geniuses are buying any Media

stocks even, if not very profitable, as soon as they can if it isn't
because whoever controls the Media has the politicians in his
pockets?
 CHAPTER XI.

THE NATURAL CONFLICT BETWEEN CAPITAL AND LABOUR

PROFIT AND WAGES.

********

As we have seen, labour power is subjected to the law of demand

and supply; but the worker, as a Human being, cannot bear to be
subjected to, and demeaned by such ruthless and impersonal law.

We find in Adam Smith's analysis a basic and clear explanation of

how this law is supposed to work in respect to the labourers - the
Human commodity in capitalist production: The cost of labour is
the cost of producing a labourer; it is the cost of his subsistence
or the expense of maintaining the labourer alive while he is
working.

When the society is expanding there is more demand for labour,

this causes a rise in wages (the price of labour) and in the
standard of living for the worker, consequently, his children are
better fed, and more survive to become labourers themselves.
When there is an oversupply of labourers, or the society is in
decline, the real wages and the standard of living of the workers
start to fall; therefore, children are undernourished and their
mortality increases. Eventually labourers become scarce; if the
demand for labour increases, then their wages and conditions will
start to rise again until the time when they become too
numerous, and so on. Obviously this is pertinent to Adam Smith's
eighteen century.

If it was not for social services and modern medicine, by this law
the number of labourers would naturally and automatically adjust
to the requirements of capitalist economy. In this way, wages
were supposed to fluctuate sometime above and sometime below
the level of subsistence. But a concession had to be made,
eventually, for the propagation of the race of labourers. Adam
Smith in his analysis stated that

"...there is however a certain rate below which it seems

impossible to reduce for any considerable time, the ordinary
wages even of the lowest species of labour. A man must always
live by his work and his wages must at least be sufficient to
maintain him. They must even, upon most occasions be
somewhat more; otherwise it would be impossible for him to bring
up a family, and the race of such workmen could not last beyond
the first generation ..."

This was probably the first tampering with the law of demand and
supply in consideration of the worker.

Nobody could deny that the mass media, in most capitalist

societies, is directly or indirectly influenced by business. All we
hear from comments and editorials about our continuous
industrial troubles is a persistent cry of surprised dismay about
workers' greed and unions' disregard for the public, the Nation
and the economy. These complaints give the impression that
antagonism between labour and capital, or workers and
employers, is something alien to the capitalist system.

They Create the impression that antagonism is something

imposed from outside and that it could be easily overcome with a
bit of common sense.

The fact is never mentioned that our socio-economic system is

based on competition, permeated by selfishness, aggressiveness
and, evidently, also hypocrisy. Conflict and antagonism are
integral part in the nature of Capitalism.

Since the beginning there has been hardly a day without

confrontation and conflict in one place or another. Veiled or naked
force, blackmail and repression are the main features in the
history of capitalist development; it would be enough to mention
the excesses of the Industrial Revolution in Europe, and the
savagery of the slave trade that went on for centuries.

What are the main reasons for this conflict between capital and
labour?

The most important reason for this conflict lays in the core of the
system, in the nature of capital and labour. Both profits and
wages must ultimately come from the price of the commodities
sold. Because of competition, the capitalist will try to lower the
cost factor of wages and maintain the margin of profit in the price
of the commodities he sells. Quite naturally, the wage earner will
resist this pressure and will try to maintain the level of wages
rather than profits; consequently, there has been a continuous
struggle between capital and labour, profit and wages.

Adam Smith explains the principal reason for this antagonism. In

his analysis of the system he states that the price of a commodity
is composed by three main parts: the cost of labour, the cost of
rent or interest, and profit. In the same way, the total sum of the
prices of all commodities produced in a country (the Gross
National Product) is also divided in three parts: wages, rent, and
profit. These are "....parceled out among different inhabitants of
the country, either as the wages of their labour, the profit of their
stocks or the rent of their land..." From this basic situation derives
the never ending squabble about the division of the 'national
cake' amongst the classes of society.

Adam Smith gives us a classical description of employer - labour

relations as they were two and a half centuries ago; in essence
they were the same as they are today:

".....What are the common wages of labour, depends everywhere

upon the contract usually made between those two parties,
whose interests are by no means the same. The workers desire to
get as much, the masters to give as little as possible. The former
are disposed to combine in order to raise, the latter in order to
lower the wages of labour...."

He continues describing the factors that have determined

industrial relations to this day: employers have the sympathy of
the law and the police, they can combine easier, they can last
longer in a dispute, they can influence public opinion. The
labourers seldom have the support of the law, the police and the
media, their associations are restricted or prohibited, they cannot
last very long in a dispute and, therefore, "... in order to bring the
point to a speedy decision, they always recourse to the loudest
clamour, and sometimes to the most shocking violence and
outrage. They are desperate, and act with the folly and
extravagance of desperate men, who must either starve, or
frighten their masters into an immediate compliance with their
demands...."

Generally these conflicts end in stalemate or compromise, and

eventually they erupt again. The battles and skirmishes continue
but the war is never completely won by either side. When the
economy expands and the demand for labour increases, the
workers have a certain advantage, which they promptly lose as
soon as the economy slows down and there is unemployment.

Since the capitalists have a commanding position in the economy

and the society, they have different ways to depress the real
wages of labour. When a wage rise has cut into their profits they
can raise their prices, and the rise in wages is nullified. The
government can raise direct and indirect taxes, it can cut social
services, and it can raise the price of public utilities. Seldom there
have been laws and tribunals to control prices, but there always
have been plenty of controls on wages.

Some sections of the workforce that are employed in vital or

privileged positions in the economy can take advantage of their
situation and obtain for themselves good wages and conditions.
They should not be blamed for being selfish in a system in which
individual selfishness and aggressiveness are considered to be
virtues without which there can be no success.

But the majority of the workforce is not so lucky. Ours is a free for
all and everyone for himself socioeconomic system in which
everyone must take full advantage of any opportunity to grab a
piece of the 'national cake', or be left with the crumbs. There
should be no surprise that those who have strong elbows and
those who have knives get the bigger slices.

Another cause of conflict between capital and labour is the

contention about how much the capitalist is supposed to get, and
how much the labourer is supposed to give in return for his
wages. There always has been a contention about the quantity of
flesh blood and soul that the capitalist employer believes he has
bought from the worker, and the quantity that the worker
believes he has sold to the capitalist.

As these quantities and values can never be defined and priced,

the capitalist, under the pressure of competition, and the worker
trying to survive and improve his life, have endeavoured to get as
much as possible from each other and give each other the least
they can. Another important reason for conflict is that the
majority of wage earners are and feel alienated; even in the
developed industrial countries where the material standard of
living of the workforce has dramatically improved since the
Second World War. There was a great economic expansion during
this time, and the workers of these countries were already well
organised to take full advantage. Moreover, with the advent of
consumerism, they became consumers in a consumer society.

It is evident that families with more than one income, and those
people employed in privileged industries and services, enjoy a
high standard of living in capitalist society, comparable with that
of the middle class. But at present an increasing number of the
workforce is being pushed backwards as the economy is
contracting, the unemployed being excluded from a meaningful
participation in the life of the society. These people are becoming
more and more alienated even if they are not conscious and do
not clearly understand the real causes of their predicament.

In the ancient slave economies slaves were the personal property

of a slave owner; therefore, he had an interest to keep them alive,
whether they were working or not, as long as they had a market
value. In the feudal system, the serfs had their plots of land
therefore they were self sufficient. But in capitalist society the
workers when out of work become real paupers. They have to be
maintained by public funds. The capitalist employer must keep
them alive only while they are in his employment; when they are
not, he has no interest in them nor any responsibility towards
them.

Thus could be described the general situation of many workers in

capitalist society: they labour ( if they have a job ) with tools that
do not belong to them, on materials that do not belong to them,
to produce goods that do not belong to them and often will never
be able buy; they have no real say on what they produce or on
matters which affect their lives and that of their families; no
matter how much they are doing, they have never done enough;
they have no security for the present or for the future; when they
become old, sick or redundant they are dumped as a burden to
society. They feel that they are expendable, but they cannot get
away because they are fenced in by the private ownership of the
land and of the other means of production. Like gray donkeys,
they are forced to work day in day out, and they are lucky if they
happen to like the jobs they are doing.

If one has a family, one seldom has any money left for relaxation
and enjoyment. No matter how much his employers through the
media exhort him to work harder, and talk to him about
teamwork, the Nation, the Economy, etc. one has a feeling that
he is only a number, and that he is just kept alive so that he can
go back to work the next day, if one is lucky to have a job, and so
that he can raise a few children to replace him when he is too old
to work.

Even oxen and milking cows must be kept alive in order to be

kept working.

Alienation is more accentuated in some countries than in others

The reason is that each nation has developed in different
circumstances and environments. There are different
combinations of temperamental and historical backgrounds. Each
case could be explained.

Japan is one example: there the relations between employers and

employees, mainly in the bigger companies, is more close and
cooperative than in the West (1970). In Japan, during the last
century, the feudal establishment consciously and willingly
decided to transform their feudal economy into a capitalist
system of production.

Therefore, Capitalism in Japan still has some of the features of the

Japanese feudal system: some paternalistic relations remnants of
the feudal hierarchy and social castes with their reciprocal
covenants and responsibilities.

In Europe, the capitalist class evolved mainly from the often

despised class of merchants, usurers and artisans of the Middle
Ages, who often were bonded serfs themselves and had no such
feelings of paternalism or responsibility towards the rest of their
countrymen.

For many reasons the attitudes of employers and workers of

different countries may be different, but the pressures of
capitalist economy are the same, and in the end will produce
similar results. Competition on the world's market will naturally
tend to reduce the working conditions of the workers in most
countries to the minimum denominator.

Because labour power in capitalist economy is considered a

commodity, the capitalists must try to keep its cost to the
minimum. Therefore, from the beginning they had to suppress all
workers' organisations; their leaders were sent to the gallows or
to penal colonies. Many laws were enacted to regulate labour
relations, to tie the hands of the workers, to punish employers for
raising wages above set levels, to punish workers even harder for
accepting such rises.

In the industrial countries it took a long and hard struggle for the
workers to improve their conditions. But in many capitalist
dictatorships labour repression is still the same or even worse
than in the early stages.

The necessity to keep wages down is ever present; it is all we

hear in the capitalist media.

It seems evident that, no matter how many times the capitalist

has promised to the 'working poor' the benefits and leisure that
should come from hard work and technology, he is impotent to
fulfil this promise, notwithstanding all his best intentions. Any
improvement has to be seized from him. He is pressed by
competition, the law of the market, and the drive to maximise his
profits. Moreover, he cannot remove the element of want and
necessity completely from the majority of the workforce. This
element is an essential part of the mechanism of capitalist
production: it is mainly necessity that drives the worker to seek
employment under any conditions. If he is well paid, as soon as he
can afford he will slow down, he may become insubordinate, he
may retire or stop working for a master.

These forces compel the capitalist in the course of his business,

no matter how gentle and good natured person he may be in
private life, to resist the attempts of his employees to obtain
better wages. He is compelled to prefer, and sometimes to create,
a situation in which the supply of people in search of work is in
excess of the demand for their services, even if this may mean a
slower economic growth and a lot of misery for a lot of people.

The capitalist, therefore, must oppose labour unions and workers'

political parties that give strength to the labourers. He must also
be unsympathetic towards social schemes and unemployment
benefits that diminish the workers' necessity to seek employment
under the worst wages and conditions unemployment benefits
interfere with the law of demand and supply in favour of the
worker.

The capitalist must also prefer a situation in which the basic

commodities, like food and rent, essential for the subsistence of
the labourer, are dearer; this lower the real wages of labour and
gives the capitalist an advantage, as Adam Smith observed two
centuries ago

"...wages are high in cheap years, and low in dear years, so that
masters commend dear years. Masters of all sorts, therefore,
frequently make better bargains with their servants in dear than
in cheap years, and find them more humble and dependent in the
former than in the latter. They naturally, therefore, commend the
former as more favourable to industry....."

These are some of the antagonistic features deep rooted within

the nature of capital-labour relations in capitalist society.

CHAPTER XII.

THE CAPITALIST AND PROFIT.

********

Every trade and profession performs a definite task within a

society. A tradesman, for example, by working with tools and
different materials produces all sort of objects; he knows how to
make things, and in this way he earns his living. A merchant or a
banker works with money, they know how to manage money and
make money with money; it is a trade like any other, it is a way of
life, a way of earning one's keep. In practice, no section of society
is more important than another and can stand completely on its
own; and it is more likely that a 'maker of things' will survive on
its own by somehow continuing to produce, than a middleman or
non producer.
Every tradesman, businessman, professional person, etc. acquires
particular attitudes of mind, which are partly related to and
influenced by the trades and activities which provide them with
the means of their subsistence.

They see life and the world around them in relation to themselves
and, therefore, also in relation to their occupations. Often, these
attitudes are reinforced by living in a closed environment and in
close contact with people of the same profession and trade; often,
as attitudes are handed down through many generations, they
are reinforced and become strong traditions, especially if the
trades are materially successful.

Generally speaking, these different groups of people, with their

different incomes, levels of education and attitudes, form the
various classes within the socioeconomic organism; some may be
related and have similar interests, some may have conflicting
interests. The capitalists are one of such groups in the society.
From ancient times until the Middle Ages, within the slave and
feudal economies, artisans, merchants and money lenders formed
the lower classes of society, below the priests, the warriors and
the patrician nobles; often they were slaves or emancipated serfs
trading for their masters.

The land and the force of arms, not money, were the main
sources of wealth and power.

During the later stage of the Middle Ages with the discovery of
new markets and new methods of production the class of traders
and money lenders began to assume an importance that they
never had before.

In an expanding world, trade and finance became very important.

Merchants, bankers and manufacturers became the nucleus
around which Capitalism grew and expanded. By handling
everybody's money they became financiers to all kind of
enterprises, lenders to Kings and Kingdoms, for peace and for
war. They dealt with capital in the form of money, they earned
their profits and fees not by hoarding it but by lending it away.

The dream of the bankers, therefore, is to have the whole world

indebted to them. Today they have very well succeeded and, it
seems, they may have gone too far.

During the last two centuries, they gave the imprint of their
merchant class mentality and attitudes to the growing capitalist
society. They influenced and supported the ideal of freedom,
especially their own freedom, equality, especially their own
equality, and their form of democracy, capitalist democracy. They
promoted and financed the struggle against the nobility and the
feudal establishment.

The way of thinking and attitudes of the merchant class, the old
traders and money lenders, became the philosophy of capitalism.

Having been in power for so long, they have unconsciously

succeeded in permeating western society with their values and
their logic. The law of the merchant has become the law of the
land. The core of this law is that only by trade one can make a
profit: Profit is sacrosanct and it justifies everything, because by
profit they live, they can increase their wealth and, as a
consequence, provide work for those who have no land or capital.
Therefore, although they like to talk of profit in the abstract, when
we talk of profit we talk in fact of the increase of their personal
wealth and their private property, which are the only incentives
they understand.

It is by the law of the merchant that nothing can be produced,

moved or consumed without a capitalist making a profit. Every
aspect of life, even the most natural and intimate, must be
subject to the law of the merchant, to a contract, to a sale or
purchase, to some deal for a profit.
The merchant has transformed the world and has moulded it to
his own image. Production for simple convenience, benefit or
usefulness is not possible any more unless there is a profit to be
made by a capitalist or a dealer. As they are in charge of an
important function in the life of the capitalist organism, they have
done what any other section would have done in their place : they
naturally took advantage, and now they hold the rest of society to
ransom, if there is no profit for them the rest can go to hell. It is a
big bluff, but few people understand it.

As long as there is profit the most miserable and destructive

activities can take place; and if there is no profit the most
Humane and beneficial things will never be done, even if the
materials and manpower are available and are being wasted.

Important things need to be done for the survival of Mankind on

this planet, there is ample wealth of materials, millions of people
with great potential are rotting in idleness. Yet nothing can be
done because there is no profit for the capitalists in these things.

Therefore, while they wade in luxuries and waste they have the
affront to say that the 'economy' cannot afford to provide for the
conservation of our planet Earth and the necessities of society.

Moreover most people, having been brainwashed into idiocy by

the influence of merchant logic during the last two centuries, are
prepared to accept the concept that a war of destruction may be
necessary and beneficial; there are profits to be made, and
capitalist economy can function again. How many people today,
faced with the problems of the saturation of capitalist economy,
think of war as a solution to the problem of overproduction?

The law of the merchant has been imposed on Humanity. It is now

deeply established and it is not even questioned any more.
Madness has become normality, it has become normal to be mad.
Capitalists are Human beings and they cannot be blamed entirely
for the faults of the system; in the words of Adam Smith, "...... the
evils come from the system, not from the character of the men
who administer it...." They did not invent Capitalism; as Western
society evolved, they evolved with it. In a new environment, they
found themselves in a commanding position and, naturally, they
took advantage.

They become dangerous when, out of self preservation, they go

to extremes to maintain alive an economic system which, having
become obsolete has become also regressive. But it is in the
nature of things that, within any society in our history, people who
are in command seldom will relinquish their power and privileges
without a struggle. Amongst them there are always some
extremists who would risk total destruction rather than accept
change.

Social classes have more to do with the way people earn their
living and the size of their incomes than with any other factor.
Only a small percentage of people in our society are
businessmen, and anybody with the right attitude could try to
become one. But to succeed and stay in business one must
assume the mentality and logic of the capitalist merchant. His
motto must be 'business is business' or business come first; a
capitalist businessman not only must never do anything for
nothing, but he must always try to get in return more value than
he gives out.

It is evident that the system has a great influence on people

attitudes; it reinforces or distorts certain natural Human features,
and it gradually suppresses others.

Most people, at one time or another must have observed a

gradual change of attitude and behaviour in a friend or an
acquaintance who has just started a business. Sometimes the
change can be quite rapid, like when a tradesman who has been
working for wages starts to work on a contract or subcontract
basis and becomes self employed.

It could be said that many capitalist businessmen have a dual

nature: one when they are away from business, and one which
they must wear when they are involved in the competition and
hassle of the market.

It is a natural feature of the system that, while the capitalists are

forced to be stingy with the productive Human and material
forces which they employ, they can be lavish with themselves and
with those who provide services for their pleasures.

Amongst all capitalist businessmen, the bankers and the

merchants of the corporations are the most powerful; they handle
the deposited profits and savings of capitalist society, including
their own capital. Today, the big banking corporations and the
International Monetary Fund, which they indirectly control, hold
the purse strings of most countries in the world, and they dictate
economic and social policies to those Nations that are indebted to
them; Thus far have evolved the bankers, usurers, merchants and
manufacturers of the Middle-Ages.

What is profit? The capitalist insists that it is not a recompense for

his work of organising and supervising the employment of his
capital; for this work he draws a salary like his employees.
Besides, if profit was the recompense for their labour, some
capitalists would get nothing because some do not work at all.

The capitalist maintains that profit is the remuneration for the risk
he is taking by investing his capital. Some say also for the service
they are doing to society by providing work. They are so
convinced of their importance that they believe they are never
repaid enough for their merits.

But, whether there is risk in their investment of capital or not, it is

a risk which they must take in order to get anything out of it.
They know very well that if their capital is not invested and
brought to life by labour, it would produce no profit. They know
that if all their capitals were deposited in the banks and were not
lent out and put to work, they would not get one cent of interest
out of it. Nobody is forcing them to invest their capital; it is their
desire and their necessity, it is the way they earn their living.

It is immaterial to try to define the abstract concept of profit, or

whether it is right or wrong. It should be enough to understand
that the merchant, generally, makes his profit by buying
commodities and selling them on the market for more that he has
paid for them. The manufacturer makes his profit by employing
the labour of other people to produce more value that he gives
out in wages. The capitalists can do this because they own most
of the land and the other means of production; therefore they
have a commanding position in the society and the economy. The
workforce is their captive: it depends on them for employment, as
we have seen earlier in the essay.

It is natural that they take full advantage of the situation, and

they go to extremes to preserve the system which provides them
with power, even when it has become obsolete, an impediment to
further real progress and a danger to Human existence.

The trouble is that they have succeeded in convincing the

majority of the public that the interest of the capitalists is the
same as the interest of society.

This capitalist assumption is contrary to the facts.

Adam Smith already over two centuries ago, in his analysis of the
system, explained this divergence of interests. Regarding the
capitalists, "those who live by profit", he clearly exposes that they
are a class of people whose interest seldom coincides with the
interest of the rest of the public and the society as a whole. Their
interests are often the opposite of those of the society and,
therefore, we should be very suspicious of all their proposals and
their advice because these come "...from an order of men, whose
interest is never exactly the same with that of the publick, and
who accordingly have, upon many occasions, both deceived and
oppressed it."

From book I to book IV of his analysis Adam Smith often criticises

the early capitalists, and blames them for the negative features of
the system; so much that a reader may easily form the opinion
that the system could have been better without them or, at least,
without their interference.

Naturally, this is a contradiction; how could Capitalism have

developed without the capitalists?

In his analysis, Adam Smith even states that merchants and

manufacturers should never be allowed to become the "masters
of mankind "; this was the wish of a great optimist. It was
inevitable that they would eventually control capitalist society.
Today, the worst of their kind are in power, the money merchants,
those who profess the philosophy of Ayn Rand and the economic
theories of Milton Friedman.

It would be absurd to accept the proposition that for the

continuation of a socio economic system the majority of people
should sacrifice and suffer most of the time to promote the
interest of a minority. We could not say that a society was
prosperous and progressive if the majority of its citizens were
living in material and spiritual misery: a society means the
majority of its members.

One of the flaws of Capitalism is that because of its nature, that is

the pressure of competition, the instability produced by fast
change, and because of narrow individual selfishness, nothing can
be of long term; turnover must be accelerated, profits must be
maximised, nothing can be left still, there is no time to think
further than the next financial report. As intelligent and as
educated the capitalists may be, Capitalism and long term
wisdom do not mix. It is this short sighted, short term, sectional
interest of the capitalists that clashes with the real long term
interest of Human society.

There is another source of conflict of interests between the

capitalists and the public, which is at the core of the system:
competition eventually drives the capitalist to become a
monopolist, despite his professed belief in free enterprise.

Monopolies may suit some businesses and raise their profits, but
they are not in the interest of the public, and it is the public which
constitutes the society.

As we have seen before, another divergence between the interest

of the capitalist and the rest of society is the antagonistic nature
of the relation between profit, the reward of capital, and wages,
the reward of labour. As both the capitalist and the labourer
always try to maximise their rewards, they come into conflict with
each other. In this respect they have conflicting interests.
Therefore, as wage and salary earners are by far the majority in
relation to those who live by profit, it is evident that they
constitute the majority of the society, and, in the words of Adam
Smith, "....what improves the circumstances of the greater part
can never be regarded as an inconveniency to the whole. No
society can surely be flourishing and happy, of which the far
greater part of the members are poor and miserable. ......The
liberal reward of labour, therefore, as is the effect of increasing
wealth, so it is the cause of increasing population. To complain of
it is to lament over the necessary effect and cause of the greatest
publick prosperity....."

As we have seen earlier, conflict of interest is evident also in the

fact that capitalists prefer years of scarcity ".. to years of plenty
because they ..... frequently make better bargains with their
servants in dear than in cheap years, and find them more humble
and dependent....They naturally, therefore, commend the former
as more favourable to industry...." it is difficult to imagine a
greater divergence of interests.

The most striking evidence of conflict of interest is shown by the

early colonial trade. When the merchants' greed was not
restrained by religious, racial or national considerations, their
exploitation was ruthless and naked: it produced large profits for
the companies, but ruin and slavery for the colonial societies.

Most capitalists naturally try to make us believe that it is their

interest which closely coincides with the interest of the entire
society. They promote the assumption that it is only as a
consequence of their profits that society will eventually benefit
and prosper. Therefore, they propose that all section of society
but themselves may be called to make sacrifices in order to
produce an economic environment in which the investment of
their capital is most profitable.

This is the reason why, while they are in a controlling position,

they are forcing the rest of society to accept as condition for its
survival the 'economic necessity' of mass unemployment, the
dumping of young generations, the waste and contamination of
irreplaceable natural assets; in short, the submission of
everything to capitalist economic necessity, that is the
requirements of the capitalist merchant.
 CHAPTER XIII.

CAPITALISM AND THE PHILOSOPHY OF SELFISHNESS.

********

Western Capitalism has evolved for more than three centuries,

and during the time of its expansion it has been a progressive
force in many fields.

It brought a degree of personal freedom to the populations of the

industrial countries, and it instituted a democratic system of
government adapted to capitalist requirements, but with a
constitution that hampers or prevents qualitative changes.

The bourgeoisie needed the help of the masses of peasants and

workers to wrest power from the nobility; the peasants serfs and
workers, in their turn, opted for the 'liberty, equality and
fraternity' of the bourgeoisie and against the oppression of the
obsolete feudal system.

But Capitalism, notwithstanding its proclamations of freedom and

democracy, has never obtained complete respectability, nor the
justification of a definite ideology. Because it could not break
down completely some of the old Christian and Human values, it
had to apologise and pay respect to ideals and institutions which
were incompatible with capitalist business.

It had to try to combine and disguise its blind selfish nature by a

sort of hybrid union with Christianity, and by attempting to marry
its own values with those of Christ; hence, the inherent hypocrisy
of capitalist apologists and the emptiness of those religious
institutions which accepted such hybrid union.

Capitalism's drive for expansion is hampered while it has to pay

at least lip service to Christian and other Human values. Because
these values cannot be associated with open or veiled
exploitation of man by man, they produce a sense of guilt and the
need to justify actions which cannot rationally be justified,
especially to the new generations, including the capitalists' own
children.

Because of the present world situation, the capitalists have never

felt like today the necessity to have their own philosophical basis,
and, in this way, to be free from the impediment of values which
are alien to the nature of the system.

Some sections of the main religious institutions are beginning to

distance themselves from capitalism. They are beginning to
qualify their alliance and support; therefore, the capitalists have
been forced again to find an ideological crutch to support and
justify their values.
Some apologists of the system have tailored, out of some old and
well worn rags, a philosophical coat of sort to suit the narrow
minded selfishness and presumptuousness of the modern
capitalists, who are no different in essence from the old
merchants and master manufacturers that Adam Smith often
berated and sometimes vilified in his analysis of the capitalist
system.

This new philosophy breaks away completely from the old

Christian values. Its motto is not Christ's "love thy neighbour", but
Cain's "I'm not my brother's keeper". It puts selfishness, with
some obscure qualifications, on the altar of capitalist worship,
together with the gods of Money and Material Success. There is
an upsurge of 'Right wing Christianity' that practically puts
business before God, and whose high priests are in fact ex
commercial salesmen.

Concepts and opinions that in the past could only be whispered

are brought into the open with all the trumpets of modern
advertising. A book is written about the "Virtue of Selfishness"
another about "Capitalism, the unknown Ideal". In these, capitalist
businessmen are depicted as the salt of the Earth, as Atlas
supporting the world on his self sacrificing shoulders (?!), all those
who profess or practice altruistic or Humanistic, not to mention
socialist principles, are painted as subversive and evil, a danger
to western values and civilisation.

As a scientific support for their doctrine, they twist Charles

Darwin's theory of natural selection, or the survival of the fittest,
to fit the present unnatural environment of capitalist economy
and society. They equate the natural instinct for survival with
blind selfishness.

They are convinced that capitalist selfishness was, is and forever

will be the nature of things and, consequently, the law of nature;
this is their genesis: in the beginning was Selfishness, therefore,
Capitalism.

On the economic side, this miserable doctrine is a nostalgic and

hopeless attempt to turn social and economic history back to the
time of the Industrial Revolution, when Capitalism was unfettered
and rebel workers were transported to penal colonies. The
capitalists seem to forget completely that early situation was
precisely the origin of the present one.

They extol the virtues of free enterprise and free trade, as during
the Industrial Revolution, but they forget the misery and the
excesses which brought about bloody revolutions and present
government controls. They seem to forget completely that history
has progressed since then. They seem to ignore the development
of trade unions, socialist movements, the results of two world
wars, the formation of socialist countries, overpopulation in the
world, overproduction and saturation of the markets, pollution,
etc.

Their idealised notion of early Capitalism has more to do with the

nostalgia created by Hollywood movies than with documented
reality.

Their assumptions are quite superficial. In fact, with few

exceptions, free enterprise and trade have never been a reality,
except in the sense that capitalist merchants 'freely' robbed the
people and the lands they dealt with. Capital accumulated and
prospered more from the blood of slaves and the sweat of child
labour than from the individual hard work of capitalists.

Their philosophy promotes the belief that capital, not labour, is

the origin of all wealth. From their point of view, the capitalists
assume that it is in the interest of the whole of society to make
capital investment as profitable as possible. To this effect, they
propose that all controls over production, planning, safety, the
environment, minimum wages, should be removed; that the
government should never interfere in economic matters, that it
should only be concerned with defence, law and order, the
protection of private property, and acting as referee in the
squabbles between those capitalists who may have conflicting
interests. In this way capital investment would become more
profitable, more people could be employed, more taxes would be
paid to the government, and, consequently, the economy and the
society would prosper. Their conclusion is that it is in the workers'
interest to cooperate with their employers as partners in the
economy towards the 'common good'.

But because of competition and the other factors in the nature of

the system, this idyllic partnership has seldom become a reality.
The workers had always to be on their guard, and without their
protective organisations they would be lost.

If we examine this partnership proposition more closely, we would

find that the capitalist has a big advantage, he is not pressed by
immediate need, and he is motivated by the prospect to increase
his own personal wealth; while the worker's main incentive is his
immediate survival, fear of unemployment and poverty. It should
be evident that the worker is in reality a captive at the discretion
of the capitalist. This is not a strong foundation for a good and
long lasting partnership. Such relation could only be described as
the partnership of a master and servant.

Another flaw in the proposition is that, because of competition, an

increase in capital investment may not produce more
employment of labour, but rather a more intense use of
machinery and automation. Moreover, in the present situation of
overproduction and saturation of world markets, the worker is
compelled to compete against the cheaper labour of the
developing countries. In fact, to produce profits for the capitalist
to stay in business, he would have to resign himself to accept a
cut in real wages; if he cannot compete successfully, he will soon
find himself unemployed and abandoned by his partner. The
partnership would collapse, his employer would pack up and
invest his capital in a developing country where labour is cheaper
and he could make a profit.

In such partnership between capital and labour, in the present

situation, we usually see the capitalist increasing his wealth and
his lifestyle, while the worker is reduced to accept a lower
standard of living. The first extol the `virtue of selfishness', can
avoid making sacrifices, and justifies his often successful
attempts to avoid taxes. The other is exhorted to be 'altruistic', to
make sacrifices for the common good (?) of the Country; he has
no security, he has no chance to avoid taxes, but when he
becomes old, sick, unemployed, or just tired, he is treated by the
capitalist like a beggar, a bludger or a failure, a burden to the
economy and to the taxpayer (?).

Who would accept such a partnership, and a philosophy which

says in fact: work hard and tighten your belt to increase wealth
for the master, because the more food there is on the master's
table, the more chance there is that some leftovers may fall for
you under the table. This is the philosophy of the `man and
servant', of the 'master and dog'; and, in my opinion, it is only fit
for whoever has the mentality and attitude of a servant or that of
a dog.

Only foolish and servile people would accept the capitalists'

maxim that, for the same economic necessity by which the
capitalists clamour for more profits and personal gain, the
workers should make sacrifices, the sick, the old and those out of
work should lose even their dignity.

There are many fools who believe that there is no alternative but
to accept this logic. They have been made to believe that
anything that is against Capitalism is against God and Country,
against Freedom and Democracy.
This is the philosophy promoted by the merchants, and only the
cunning and sophistry of the merchants could have persuaded the
public to accept it. The merchants, "an order of men whose
interest is never exactly the same with that of the publick", today
rule the world; and what Adam Smith had dreaded and warned
against two centuries ago, that they should never become "the
rulers of mankind", has come to pass.

CHAPTER XIV.

THE MECHANISM OF CAPITALIST EXPANSION.

*******

So far we have considered separately the main elements in the

capitalist cycle of production: we have briefly discussed the main
natural forces and natural laws which derive from them.

Now we should be able to understand more clearly the

mechanism of capitalist expansion, which, once put into motion,
has gathered such momentum that no force on Earth could have
stopped it until it had exhausted all the forces and altered all the
factors and the environment which have brought it to life.

The capitalists themselves are captive of the system.

Notwithstanding their position of advantage, they are only actors
playing a part which is dictated to them by forces which they
cannot fully control, nor really understand.
We have seen that the capitalist is motivated by the prospect of
profit; competition in the market compels him to continually
attempt to lower the cost of production by keeping wages down
and by replacing labour with new machinery.

We should understand by now that the capitalists can never stop

for long to enjoy the fruits of their success in raising productivity.
As soon as one slows down he is in danger of being overtaken by
the competition. Therefore, they are compelled to chase their own
tails in a race from which they cannot easily withdraw.

The process of capitalist expansion started very slowly during the

Middle Ages, but, during the last two centuries, it has accelerated
and gained momentum to such an extent that it has almost
completely changed the face of the Earth, and it has shaken
Humanity out of its slow pace of evolution.

Changes have been brought about so fast that the Human race
has been thrown into confusion, incapable to fully adjust to ever
new situations. While still blinded by our ignorance, today we are
forced to choose between different alternatives, one of which may
bring about our complete destruction.

Adam Smith, in the eighteenth century, could not have foreseen

the extent of this expansion. But Carl Marx, a century later, was in
a better position to study the capitalist system of production as it
accelerated its development during the Industrial Revolution. His
analysis, in "Capital" and other writings, is still basically valid
today, except for those new factors and developments in the
present stage that no Human being could possibly have foreseen
one hundred and fifty years ago.

In the last of a series of lectures entitled "Wage Labour and

Capital", which he gave in December l847, we find a very
accurate description of the mechanism of capitalist expansion and
evolution.
These are the main points: a capitalist to be able to compete,
must produce and sell more cheaply. To produce more cheaply,
he must raise the productive forces of labour. To raise the
productivity of labour he must reorganise and streamline his
workforce, use new technology and machinery; in short, he must
adopt more efficient methods of production.

If he succeeds in producing more and cheaper commodities, he

must sell more in order to obtain the full benefit of his increased
production; therefore, he must find new markets and new outlets,
selling his commodities at a price slightly lower than his
competitors.

For a period of time he will have the advantage. But soon the
other producers will adopt the same or newer methods of
production, and, eventually, he will find himself in the same
situation relative his competitors as before his improvement in
productivity; the only difference being that now there would be
overall higher production, and the markets would have been
expanded.

Consequently, to be able to stay in business the capitalist must

continually try to raise the productivity of his workforce and his
machinery, and also try to find new markets:

".. however powerful the means of production which a capitalist

brings into the field, competition will make these means of
production universal, and from the moment when it has made
them universal, the only result of the greater fruitfulness of his
capital is that he must now supply for the same price ten, twenty,
a hundred times as much as before. But as he must sell perhaps a
thousand times as much as before in order to outweigh the lower
selling price by the greater amount of the product sold. . . . this
mass sale becomes a question of life and death not only for him
but also for his rivals, the old struggle begins again all the more
violently the more fruitful the already discovered means of
production are. The division of labour and the application of
machinery, therefore, will go on anew on an incomparably greater
scale..."

The capitalist is forced to continually expand, to adopt new

technology of production. He cannot wait until the opposition has
found a way to come on top, he must keep on improving his
productivity and replacing his machinery even before they have
been fully utilised.

The instruments of production become more and more expensive,

the small capitalist cannot compete against the bigger ones: "...If
we now picture to ourselves this feverish simultaneous agitation
on the whole world market, it will be comprehensible how the
growth, accumulation and concentration of capital results in an
uninterrupted division of labour, and the application of new and
the perfecting of old machinery precipitately and on an ever more
gigantic scale.... "

This expansion, caused by the law of the market and by

competition, eventually produces a situation in which monopolies
and corporations must develop:

"..... It is self evident that the small industrialist cannot survive in

a contest in which one of the main conditions is to produce on an
ever greater scale, that is, precisely, to be a large and not a small
industrialist. "

Finally, as the continuous increase in productivity overtakes the

capacity of the market to absorb the increasing quantity of
commodities,

" . . .there is a corresponding increase in industrial earthquakes,

in which the trading world can only maintain itself by sacrificing a
part of wealth, of products and even of productive forces to the
gods of the nether world: in a word, crises increase. They become
more frequent and more violent, if only because, as the mass of
production, and consequently the need for extended markets,
grows, the world market becomes more and more contracted,
fewer and fewer markets remain available for exploitation”.

In this way, the capitalist socio-economic system, moved by this

almost mechanical law of capital and technological expansion on
this small Planet, must eventually reach certain natural limits
beyond which it can only continue in an artificial and irrational
form.

CHAPTER XV.
 THE SOCIAL AND ECONOMIC EFFECTS OF CAPITALIST
EXPANSION.

********

In this part of the discussion we have observed briefly and in

general terms the natural laws and mechanism in the expanding
spiral of capitalist production and development. What follows is
mostly from K. Marx writings.

It should be evident that this spiral, as it developed, has thrown

aside or eliminated all impediments which stood in the way of its
natural expansion. "Ancient values and traditions have been cast
aside.

Old virtues have become vices, old vices nave become virtues" .

Capitalism could not expand within the limits of feudal values,

customs and politics; therefore, it had to replace them with its
own.

The capitalists, while struggling for their own freedom, could not
deny the freedom of the rest of society; they had to proclaim their
support for the general idea of Human liberty.

The capitalists, while struggling for equality with the nobility,

could not deny these rights to the rest of the population; they had
to proclaim the ideal of general equality, not so much before God
but before money.

Capitalism needed a plentiful and mobile workforce, therefore,

the serfs were freed from feudal bondage, and were pushed
towards a different kind of servitude.

Capitalism needed literate workers to work in the factories,

therefore it had to promote a minimum level of education for
most of the population.
The capitalists had to have a say in the process of government
and decision making, therefore, they organised their political
parties against the conservative feudal establishment. With their
mastery of the press and the professions, and the support of the
rest of the population they gradually took over the State. They
instituted a capitalist democracy with a capitalist constitution.

They needed to expand trade and find new markets,

consequently they went to every corner of the Earth. In so doing,
they brought all nations face to face, and forced them, on pain of
extinction, to adopt the capitalist system of production and
exchange.

Old dormant societies and cultures have been shaken from their
slumber.

With the development of transport and communications, space

and time have been reduced. The world has become a melting
pot in which all races, nations, cultures and religions are being
forced to face one another and solve the problem of coexistence
or amalgamation.

While we are still ignorant and confused, already the embryo has
emerged of a 'global' economy, a 'global' society and culture.

Unfortunately, although Capitalism has brought many progressive

changes, it also has undermined customs and basic Human
values which were much older than Feudalism, and which had
been an asset for Humanity long before the advent of Christianity.

The capitalists during the last three centuries have gradually

remolded the world and society to their own image. They have
promoted their own merchant class values and logic as the
unchangeable laws of the land: their world is the world of the
merchant, in which everything must be subject to the law of profit
as it was the law of Nature.
The capitalists, while they are complaining about the
deterioration of basic Human values and of the family, are
commercialising all aspects of Human life and, therefore, are
undermining and destroying these same values. All relations have
been reduced to 'money relations'.

Motivated by the search for profits, and compelled by

competition, in their irresistible drive for change and innovation,
they have broken the natural links between the generations: the
experiences of one generation become obsolete even before the
advent and establishment of the next. Only the technology which
brings them profits is allowed to develop, consideration for the
future of Human kind are secondary and incidental. Because of
competition, technology is brought hurriedly on the market
without much thought about long term social and Ecological
consequences.

The speed of change has overtaken the capacity of society and of

individual Human beings to adapt to continually new situations,
and this is producing all sort of negative features in our lives:
insecurity, confusion, insensitivity, breakdown in Human
communications, etc. Material success has become the only
measure of personal value. Even the gangster, if successful, is
glamorised and respected, and today he probably divides his time
between crime and legitimate business.

The honest man, who rarely succeeds, is derided and called a

'sucker'. Individual selfishness and aggressiveness are essential
qualities or virtues for success in capitalist competition;
consideration for other people and good nature are handicaps;
yet everybody is complaining and asking why people, especially
the young generations, are becoming more and more insensitive
and ruthless, lacking feelings and compassion.

In all important issues, questions of principle have become

secondary and subjected to money considerations there is a
progressive bastardisation of Human society. The rule of the
bankers, merchants and manufacturers today is almost complete.
They influence the media, the law and justice, the army, the State
and the majority of the public; capitalist democracy is in fact the
disguised dictatorship of a minority the capitalist class.

The academic world, with few exceptions, is in the payroll of

capital. People working in the professions have a place in the
middle class of capitalist society. As critical as they may be at
times about the present world situation, they are not allowed, and
do not dare, to challenge directly the basis of the capitalist
system: blindness and hypocrisy have become prominent
features in capitalist society.

It is the nature and mechanism of the system which are producing

most of the problems that we are facing today.

Karl Marx was not far from the truth in his assessment of
capitalist economic and social development. In his terse and
concise description of capitalist evolution up to his time over one
hundred years ago we find already present all the main features
of saturation and crisis that are so evident today: diminishing
markets, ever faster technological change, wasteful consumerism,
a widening generation gap, etc..

It should be evident that our present problems are not temporary,

they have started long time ago; they are the direct results of
capitalist evolution. As we continue to follow the capitalist
philosophy so the problems increase and become compounded.

Like all preceding socio-economic organisms, civilisations and

cultures in Human history, capitalism is a natural stage of Human
development, a development which has always been and still is
affected by our original ignorance. A combination of historical
factors has brought Capitalism to life; it has evolved from
previous organisms, and it has overtaken and displaced them as
they became obsolete.
Today it has reached the limits of its natural development, it has
changed the environment that has brought it to life, and it has
become obsolete itself. Now it is in decline and it has become an
impediment to further progress. Our present problems cannot be
cured within the system that is causing them.

In the nature of free competition, the law of the market, the drive
to maximise profits and wages, we find the causes for the
development of monopolies, corporations, unions and
associations which render impossible the capitalist dream of free
enterprise and free trade; we find the causes for the explosive
expansion of productive forces and technology, the saturation of
world markets, the disregard for social and ecological harmony.

In the nature of capitalist production we find the causes why there

must be at all times an abundant pool of poor people in search of
work ".....the labour of the poor being the mines of the rich..... "

In the nature of capitalist property relations we find the causes

why the abundance of capitalist production must be wasted and
will never be shared with equity within society; we find the causes
for the continuous antagonism between capital and labour, and
we find also the causes for greed and the alienation of a mass of
Human beings.

Finally, to preserve a 'double standard' social system in which a

minority is motivated by the incentive of profit, which is an
increase in personal wealth, and the majority is motivated by the
fear of unemployment and misery, the capitalists must attempt to
limit the degree of education and information to a level which
does not produce the capacity for objective thinking within the
general public, and does not stimulate a deeper questioning of
the system.
 PART II.

THE PRESENT STAGE OF CAPITALIST EVOLUTION.

CHAPTER XVI.

GENERAL OUTLINE OF THE PRESENT STAGE OF

DEVELOPMENT.

********

Since the Industrial Revolution Capitalism has evolved and

expanded at increasing speed. From Europe it has spread
throughout the world, affecting and being affected by the
different environments and cultures.
The capitalist socioeconomic organisms that we find in South
America, for instance, are different from that in Scandinavia or
other parts of the world, but all these different forms are
variations of the same main theme.

Technology has revolutionised the economy and society. It has

created entirely new factors which are influencing in almost
unforeseen ways the direction of our change.

The productivity of capital and labour has risen to a degree that

was never thought possible. Consequently the 'effective demand'
has been overtaken and the 'markets' are being saturated. At the
same time capital has become concentrated in the hand of
relatively few 'transnational' banks and corporations. Their
investments are spread throughout the world, and consequently
there is often a divergence between their interests and that of the
countries in which they operate.

Countries that used to be a market for the products of the

industrial Nations have been industrialised. They have become
producers themselves and are keen competitors in world trade.

To overcome the absurd problem of overproduction and a lagging

demand for commodities, the logic of the merchant has devised
the scourge of consumerism, with the public and the developing
Nations of the world as their victims; these have become
dependent, enslaved by debt for generations to come.

Because of the overcrowded situation in the world market and the

desperate state of indebtedness of some developing Nations, the
trade war, which has always been a natural feature of capitalist
economy, is growing in intensity.

The local industries of every Nation are crying for protection,

advocating a policy of isolation, while the transnational bankers
and Corporations, with capital invested all over the globe, are
advocating the elimination of all trade barriers. They are
advocating the institution of the 'Global Factory' and the 'Global
Supermarket' (Global Reach). Their dream is the super-
nationalisation of Capitalism, and, in its defence, the super
nationalisation of its armed forces; the United States attempt at
World hegemony and transformation of the NATO into their
policing tool is proof of this present situation, the excuse for the
general public is the never ending War on Terror.

As Capitalism has developed, it has produced opposing and

counterbalancing forces. Trade unions, political parties and
revolutionary movements have sprouted from the resistance of
the alienated or exploited classes of society. These forces are
important factors in the evolution of the socio-economic
organism, and they are themselves continually evolving.

Because of technological progress in production, the size and the

social composition of the workforce has changed. Most have
become 'consumers' in a materialistic 'consumer society', they
have cast off some of their former poverty but they have lost the
proud radical spirit of the nineteenth century.

The number of productive workers has decreased in relation to

that employed in the service industries and that employed in the
growing State and private bureaucracies. Objective consciousness
is being blurred by the pervasive influence of the capitalist
oriented mass media and education. Some of the most
unfortunate sections of society are becoming more conservative
in their attitudes than those who exploit them. But, as the
merchant economy is slowly deteriorating among the pollution
and social sickness that it creates, new opposing forces are
emerging from every level of the social structure.

Innumerable groups and movements are growing; their aim is to

change or to escape from the present socio economic organism.

At present, consumerism is not sufficient any more to take care of

the over productive forces of the capitalist system. An increasing
portion of energy and resources must be wasted in the production
and marketing of arms. This waste has become an important part
of capitalist economy, essential to keep in motion the cycle of
production and profit making.

Many countries are defaulting on the repayment of their debts.

The bankers can do nothing but to keep on lending them more
money to prop up their faltering economies in order to maintain
the illusion of the soundness of the capitalist banking system, and
prevent a loss of confidence and a general collapse. We can
witness capitalist governments using public money to rescue
failing financial institutions, corroborating the business attitude
that 'their profits are private, their losses are public'.

This is, in short, the general situation in the present stage of

capitalist economy. We will try to examine all these points in
simple and general terms. We will try to understand their relation
to the original natural laws and mechanism of the system.

Before we proceed, we should look at the confused picture of

capitalist economy in the world today.

As an attempt to see through the maze of combinations and

contradictions, we should try to pry apart each of the component
elements from their entanglement, and look at them separately,
examine their main essential features, and then we should try to
imagine what will happen when we scramble them back together.

To this purpose, we must adhere to the general aspects,

forgetting for the moment the many variations and exceptions
which would render a simple and short analysis impossible. The
variations and exceptions are real and important enough, but
they do not contradict the main essence of the present situation.

To start, we should first consider the main economic elements

that are the interconnected parts of a capitalist economic system.
Then, to this simple sketch, we should add the new elements and
factors to complete the picture.

As we have seen earlier, a Country or Nation is an organism

composed by a large group of people who usually have a common
historical heritage, common culture or religion, and usually live in
proximity within a definite geographical region. There are some
exceptions: people who try to maintain their original national
identity while they have been scattered in different parts of the
world, but their life is not generally easy although it may be
successful.

In capitalist countries most productive activities, mainly those

which are profitable, are performed by private businessmen,
companies, national and international corporations and
monopolies. All these productive activities may be grouped in
three main branches of production:

The 'Primary Industry' which is involved in agriculture and the

extraction of raw materials.

The Heavy and the Light Manufacturing Industries, which are

concerned with everything small or big that is manufactured,
whether in a small workshop or in a large industrial complex:

The 'Service Industries' comprising the private and the public

infrastructures which facilitate the functioning of the productive
industries and the distribution of their products. The more
important services are the retail industry, transport, banking,
insurance and public utilities.

Some of these industries in the economy may have opposing

interests.

One reason is that they all are trying to sell their products to each
other as dear as possible, and buy from each other as cheap as
possible within the competition of the market. For this reason all
businessmen and companies tend to join into different
associations and chambers, which in fact are businessmen unions,
to protect and promote their particular interests. It should be
superfluous to say that the corporations are conglomerates of
companies with interests in every branch of the economy.

Capitalist businessmen constitute a very small portion of the total

population. The rest, whether employed on salaries or wages,
constitute the workforce; their interests, while closely connected
with the prosperity of the industries in which they are employed,
are at the same time in antagonism with their immediate
employers because of the basic natural contradiction between
capital and labour, profits and wages. Therefore, while the
workforce may be united by its own general overall interest in
relation to its immediate employers, it may be often torn apart by
the opposing interests of the different industries.

Now, to this general description of social and economic forces, we

must add some new elements that must complicate further the
conflict of interests between and also within the different
industries and groups in the socioeconomic organism of a
country. One is the influence of the transnational corporations
that have no permanent national interests or loyalties. Another is
the armament industry.

Of all these industries and productive activities some are directed

to the home market, some are directed to the export market and
some to both; therefore, often they have opposing interests:
exporters, for example, usually prefer a low exchange rate that
makes their products cheaper on the world market, while the local
producers prefer a higher exchange rate to protect their local
market from foreign competition. The international corporations
are usually not affected by this and other particular factors; as
they play over the whole globe and they can take advantage of
various national differences.
We could try now to mix and superimpose all the activities that
have been mentioned so far, as they take place and interact in
real life; but I believe that it is almost impossible to have a clear
picture of the situation. Moreover, these are only the main
activities and to these we should also add the important cultural,
political factors that influence the behaviour of different peoples.
All we can do, in the absence of a powerful computer with a
suitable program, is to try to imagine in one picture the essential
concept of all this activity and hope to get as close as possible to
reality.
 CHAPTER XVII.

EXPORT OR PERISH.

********

Towards the end of the Middle-Ages, at the very early stage of

capitalism, production was slow and most of the manpower and
capital of a country was employed in producing the essential
commodities required for home consumption. Generally speaking,
little was left for export. Almost the total potential of capital and
labour was expended within the country. What was exported was
mainly in exchange for the materials and manufactures that the
country did not produce.

With the advance in technology, the productivity of capital and

labour started to increase to the point that the requirements
needed by a country could be produced by only a part of the
work-force: production was becoming capital intensive, machinery
were replacing people.

Given the nature of the capitalist system, if only a part of the

workforce is needed to produce the country's total requirements,
it means that the rest would be out of work and, consequently,
would not receive any wages or salaries.

Without any income, they would be reduced to poverty and, most

important of all, for capitalist economy, they would not be able to
buy any of the commodities produced by that part of the
workforce still employed. Therefore, another percentage of labour
and capital would become redundant, and more people would
have to join those out of work. In theory, and also in practice, the
result would be that capitalist economy would gradually shrink
and eventually collapse.

As we have seen earlier, this is the problem of overproduction in

capitalist economy, a problem which would seem absurd when
there are still a lot of poor people in the society. It is caused by
the continuous competition amongst the capitalists to increase
the productivity of capital and labour. Therefore, to maintain the
essential growth in investment and to prevent stagnation, the
surplus capital and labour in the industrial countries was
channeled towards export. But today, as more and more countries
are becoming industrialised and are in a similar situation, they
have all become involved in an absurd trade war in the saturated
world markets. This war has become a question of life and death
for many countries in the world, hence the cry: "export or perish!"

A country lacking in natural resources must by necessity import a

lot of raw materials and in return export manufactured goods. Its
life and growth naturally depend on the success of this trade.
Such a country normally would have just a small primary industry,
barely sufficient for its own consumption. For such a country the
cry "export or perish" is real and natural enough in the context of
capitalist economic production.

Such country would be a traditional importer of raw materials and

exporter of manufactured goods. But for a nation with a wealth of
natural resources and with a fully developed manufacturing
industry, a situation in which it must export at all costs to be able
to maintain its economic growth and full employment, must be
very complex and full of problems.

The ideal would be to be able to export without having to import

anything that can be produced at home. But, in fact, the more
one country export the more it must import, normally but not
necessarily from the country to which it exports its goods. If it
exports farm produce and raw materials, it will have to import
machinery and manufactured goods, some of which will be
competing in the home market against the goods produced by the
local manufacturing industry.

This situation may suit the exporting companies and corporations

in the primary industries. It may also suit the merchants and
traders whose profits are not determined by the origin or the
nationality of the commodities they trade with, but by their
cheapness and quality. But while this situation may suit this
section of the national capitalists, it is detrimental to those that
are involved in the manufacturing and aggregate industries.

Therefore, we find one section of business clamouring to lower

the national trade barriers to let more imports in so as to be able
to export more, while another section is clamouring to raise
national barriers with tariffs and other controls on imports to
protect their home market from an invasion of cheaper foreign
goods.

The logical capitalist answer to this problem is to urge the

manufacturing industry to become more competitive in the
already extremely competitive and saturated local and world
markets. Local business are urged to lower the cost of production
and raise the productivity of labour as much as possible, " ....but
the productive power of labour is raised, above all, by a greater
division of labour, by a more universal introduction and continual
improvement of machinery..."

The most likely result will be an increase in the number of the

unemployed.

To this effect, the industrialists, while pestering the government

for tariff protection, export bounties and lower taxes, they urge
their work force and society at large to work harder and accept a
lower standard of living in order to produce cheaper goods in
competition against countries which are natural and traditional
manufacturing exporters, or countries where the wages of labour
are several times lower than at home. They urge that we must
sell in a saturated world market where the number of competing
countries, more or less in the same situation of having to export
or perish, is growing every year. They appeal to false patriotism,
to rabid nationalism, and these exhortations often come from the
same business and corporations that have controlling interests
and investments in the manufacturing industries of the foreign
countries against which their workforce has to compete.

If patriotism is not enough to induce the worker to work harder,

there is always the prospect of unemployment plus the
competition of imported immigrant labour, for whom any pay and
conditions are better than those in their home countries. No need
to say that the main promoters and beneficiaries of such
immigration of cheap labour in time of unemployment are no one
else than our 'patriotic' national and international capitalists.

From the smaller underdeveloped countries to the biggest and

more technologically advanced, some to pay their debts, some
because they have no natural wealth but have a developed
technology, some because they have too much of both, some for
any combination of these reasons, they all must export or perish.

As they all are trying to export more or less the same

commodities, and, as their number is growing in the world
markets, a senseless trade war has developed between Nations.
We witness the absurd spectacle of the rich people and the rich
countries of the world trying to flog to each other goods and
services of which they all have too much already. At the same
time, the majority of their countrymen who are producing all
those goods and services must go without, and often must accept
cuts in public health, education and old age security. Why ?
Because, once we have subjected ourselves to the capitalist law
of the merchant, we are not allowed to produce anything unless it
is to be sold for a profit: if we can sell we live, if we cannot sell we
die.

The intensifying of the trade war is one of the symptoms of the

capitalist sickness. The outcome of this war is that the rich are
still getting richer and the poor are still getting poorer. It is a silly
and tragic contest among Nations to throw each other out of
work.

Now, to complete the picture of this world wide trade war, over
this messy sketch of over one hundred countries involved in this
pseudo nationalistic fight for survival in which the majority must
be losers, we must superimpose the important element of the
'transnational' corporations.

As they are themselves engaged in the trade war against each

other and against any of the other nationalist participants, the
resulting picture must confuse the mind. Because they involve
with their ramifications and connections most industries in most
countries of the world, the supposedly nationalistic nature of the
trade war becomes confused and unreal, one cannot say any
more with certainty whom one is working or making sacrifices for:
whether it is for one's own country, for the opposition or for the
transnationals; of one thing one can be sure, that, if one has a
poorly paid job or one is not working, he is not sacrificing for
himself.

The transnational corporations hover everywhere over the world

wide theatre of war, picking, choosing and generally taking
advantage of every situation. Therefore, besides being
transnational they have become 'supernational'. They may lose in
one place but they may win in another. They can win in a country
where the people are losing, and, in balance, they are probably
the only winners in this senseless trade war.

Such, in my opinion, is one of the confusing aspects in the present

unnatural stage of capitalist economic evolution. Since the
thirties, Capitalism has developed in an irrational way; every new
device to keep the economy from stagnating could only have a
temporary and limited success. The trade war is one of the results
of overproduction and market saturation in relation to the
effective demand; a situation which is threatening capitalist
economy and is twisting and corrupting capitalist society.

CHAPTER XVIII.

THE ARMAMENT TRADE.

********

It is fitting that at least a short mention should be made about the

armament industry, because of the importance it has acquired in
the present stage of world economy.
It is a drain of public resources and public money for the private
profit of some business and corporations. It is also a debilitating
factor for the struggling economies of the developing Nations.

The beginning of the arms race can be traced to the beginning of

our history. In ancient times, with primitive technology and
materials, every man, tribe and nation could fabricate their own
weapons.

With the development of technology and mass production, mass

wars became possible.

The manufacture and the sale of arms became a big and

profitable business for some sections of the capitalist class in the
industrial countries, and a source of employment for a section of
their workforce.

During the 'cold war', with the polarisation of forces in the

capitalist and socialist fields, and with the simmering unrest of
the emerging Nations trying to adjust after the breakup of the
colonial empires, the arms industry has assumed a great
importance in the world economy.

It affects in different ways the economies of the industrial Nations

and that of the poor developing Nations of the world.

To give an indication of the importance of the arms race to an

industrial country, nearly fifteen percent of the economy of the
United States is related to defence and the armament industry for
home and for export.

Could the United States' capitalist economy stand the trauma of

total disarmament? Would business and corporations which profit
from arms production and have influence in government, be
interested in permanent peace? What would happen to the
workforce directly and indirectly employed in industries related to
the arms race?
We can see clearly the connection between Capitalism and war .

There are no rational plans, nor interest, in capitalist ruling circles

to facilitate a transition from a war to a peace economy,
especially in the present stagnant market situation.

In a planned or guided economy, at least in theory, such

transition would be beneficial and could be effected, because the
right to work and the sharing of available employment could be
guaranteed. There cannot be such guarantees in a capitalist
economy because of the reasons that we have examined earlier
in the second part of this discussion. One is that there cannot be
long term planning, another is that a continuous state of
uncertainty and fear of unemployment are an essential part of the
mechanism of capitalist production.

Another reason why the arms race is so important to an

industrialised capitalist country is that, in a saturated market
environment, an escalating and wasteful arms race offers very
good opportunities for investment and expansion of capital. The
public is taxed to pay for armaments: arms are the ideal
commodities because they continually become obsolete, in war
they are quickly destroyed, therefore they continually have to be
replaced.

These are the main reasons why, in the nature of capitalist

economy, most capitalists are moved to prefer the waste and
potential dangers of an armament industry rather than the
elimination of poverty and insecurity, which would diminish the
prospect of war.

Capitalism today is kept in motion by the profits of the merchant,

the wants and fears of the worker, and the waste of the products.
The arms race, therefore, is an ideal activity for a number of
business and corporations.
In the end, it is always society at large that pays for the arms
race, especially the poorest sections, because they are deprived
of essential commodities and services that could otherwise be
available to them.

In the industrial countries the public pays either through taxation

or, if they are not in that bracket, through the reduction of
resources that could be used for public utilities.

With the armament industry, some sections of the work force are
provided with employment and some businesses have an
opportunity to make a profit. Therefore, there is a pressure for the
maintenance and expansion of the industry. It is a new organism,
interacting with the others, within the larger organism of the
Nation. This new organism will try its utmost to perpetuate itself
and, if possible, to grow, as it seems to be in the nature of all
living things.

It would be interesting to know just how much of the arms race

and the cold war were justified by real threats and how much by
the machinations and lobbying of powerful vested interests that
profit from the politics of fear.

The same economic necessity which compels all producers to

'export or perish', today applies also to the producers of arms. A
very keen competition has developed in this field of export
amongst all industrial countries. The main victims of this trade are
the populations of many developing nations that are still in a
process of adjustment and in turmoil after the trauma of colonial
interference.

These people, besides having to pay for weapons they cannot

afford, they are also often subjected to their devastation. To pay
for these arms, or to repay the debts incurred to purchase them,
these countries have to sell their produce and their raw materials
at low prices on the depressed world market, and this will further
depress the markets. The populations get no benefit in return,
and remain destitute. But some merchants and manufacturers are
growing fat on the profits of this trade; some governments in the
exporting countries congratulate themselves for achieving a
favourable balance of trade, and having provided work for their
own population. This is the morality of the merchant.

What is the justification for this trade in fear and death? It is

mainly capitalist economic necessity: There is profit to be made,
capital to be invested, employment to be provided, and these
reasons justify everything. Business is Business!

On the personal and moral question, the capitalist merchants and

manufacturers of arms say that it is not their responsibility; they
claim that all they do is to satisfy a demand for goods and
services; Granted, but so do their cousins - the pimps and the
criminals.
 CHAPTER XIX.

OVERPRODUCTION AND MARKET SATURATION.

********

We must try to keep in mind that when we are talking about

overproduction, abundance and saturated markets we are talking
only in relation of the effectual demand of those who have the
means to pay.

The poor people and the poor Nations of the world are naturally
excluded from the capitalist cycle of production and exchange,
unless they have been allowed to indebt themselves. In this case,
as well as being poor, they may also have become desperate as
they have become enslaved, in the grips of capitalist bankers and
merchants.

As we have seen in the second part of the essay, Capitalism must

expand. It is in the nature of the system: the capitalist
appropriates a part of the value produced by his employed labour,
this he calls his profit; a part of this profit is used to improve his
life style, a part must be added to the capital already invested to
improve productivity so as to be able to compete and stay in
business; therefore, more investment, more production, wider
markets, more turnover and profit, and so on.

During the last two centuries, with this spiral of development,

moved by the basic laws and mechanism of capitalist production,
the capitalist economic system has reached the limits of our
planet earth.
Turning in circles, clashing against the boundaries that contain it,
Capitalism seek desperately to recreate artificially, even against
Nature, the conditions necessary for its continuation.

In my opinion, the economic crisis of the thirties was the

culminating point of the natural development of Capitalism in the
West; it was the beginning of the stage of saturation. There
should have been a change towards a democratically planned
rational economy. But the establishment was too strong in
relation to the progressive forces, a peaceful change was denied,
Fascism developed instead, and eventually the Second World War
gave a new life to the sluggish capitalist economy.

From the thirties, we can observe the development of new

economic devices designed to give the ailing system a new lease
of life. These devices are unnatural and irrational, but they are
the logical capitalist solution to a saturated environment.

One of the main conditions for the birth and growth of Capitalism
had been a situation of scarcity, an empty world, an empty
market.

In such an environment, Capitalism had developed and expanded,

producing not so much luxuries, but essential, useful
commodities. Because of their obvious utility, the main form of
their advertising was their sturdiness and their lasting qualities.
There was competition not only in producing cheaper but also
stronger commodities.

Thrift and parsimony were still considered to be virtues, as they

were not yet an impediment to capitalist development; to indebt
oneself to buy commodities was considered a despicable sin.

While there was plenty of space for capital expansion, the system
developed naturally, slowing down its pace during its periodical
crises but starting back each time of its own accord.
Eventually, Capitalism had to reach a point of real crisis, because
at the same time that production was rising, it was becoming
more difficult to find new markets. Capitalism was obliterating the
main condition of its development the environment of scarcity
that had been its cradle.

Having exhausted the condition of its birth and natural

development, Capitalism, to survive, must find artificial means by
which to recreate that essential condition.

In general terms, the main feature in the thirties at the beginning

of the present stage of saturation was that some capitalists had
been too successful.

They had concentrated most of the wealth in their own hands:

they had the goods and also the money. They could do nothing
but speculate against each others. They stood at one end,
proprietors of all fixed capital, the means of production, and also
proprietors of all the accumulated finance demanding to be
invested.

But the 'effectual demand' was lagging behind the ever faster
development of the productive forces.

On the other end, the mass of the population could not constitute
an expanding market: the wages of the 'working poor', who in fact
were the origin of all that wealth, were just enough to keep them
alive and able to work. They had no money to spare to buy the
surplus of goods which they had produced but did not own.

The poor Nations of the world were in the same situation as the
workers in the industrial countries. The prices that they were
receiving for the raw materials extracted from their soil, if they
were paid at all, was not enough to make them a market;
Figuratively speaking, on one side stood the capitalist class with
the factories, the goods and the money; on the other side stood
the rest with nothing else but their empty hands.
The capitalists could not use all his surplus goods themselves,
evidently there is no profit in that; they could not give them all
away, as it is not in the nature of the merchant to do anything
without a profit. He could not raise the wages of the workers to
enable them to become a market; competition would not allow it
and, besides, it would have been the same as giving the products
away.

It seemed like a chronic sickness had set in. The spiral of

capitalist development had come to a grinding halt and capitalist
society faced its own ruin.

Before the capitalist class stood the mass of the people, idle and
hungry; Already, in the East, workers and peasants had dealt a
deadly blow to capitalist and feudal society, and they had taken
their destiny into their own hands.

Capitalism faced the danger. The merchant had to make its

'mercantile' system work: it had to provide employment for the
mass of the population or face a possible revolution.

Therefore economic theories which allowed limited government

intervention in the running of the economy were partly adopted.
Moreover, new economic trends or devices, akin the logic of the
merchant, began to develop to stimulate market demand.

In the following chapters we will examine briefly the more obvious

of these devices. They derive from the logic of capitalist economy,
the logic of the merchant. But, while they may be logical in the
context of Capitalism, they are utterly irrational in the context of
Human life on this small planet, as they contain the elements of
waste and pollution and are accentuating the negative features of
our society.

The first of these market stimulants, in my opinion, was the

growth of consumer credit in all its various forms. The second was
the growth of 'high pressure advertising', to convince people to
buy more, whether by cash or credit. The third was the
appearance of 'planned obsolescence' to shorten the life of the
products.

Actually, these three devices are the interconnected components

of what today is called 'consumerism', which is the almost
enforced consumption of as many goods and services as possible.
This is the most important device in the artificial creation of a
continuous demand in the capitalist market place, a demand that
is essential for the survival of the system.

Consumerism is the main immediate cause for the waste and

depletion of energy and resources in the world. It is the main
cause of pollution, and also the main reason why the rich people
and the rich countries are becoming richer and the poor are
becoming poorer.

We will look in some more detail at 'consumerism' and its effects

on the societies of the developed industrial countries. These
societies are indebted to the point of saturation, they have
become obsessed with material consumption and they are rapidly
degenerating. Having become dependent and enslaved by a
consumer economy, they have lost sight of their future.

The same is the case for the poor developing Nations of the world.
As they could not afford to buy the products of the industrial
countries, they have been extended vast amounts of credit.
Therefore, being deeply in debt, they have been reduced into a
state of bondage and dependence.

The greater part of their resources, instead of being used to

improve their own situation and standard of living, is being
siphoned out to the already bloated industrial countries, mainly as
interest payment on the loans they have received. With this
handicap they have little chance of improving. Only their small
ruling elites are living in luxury, while the majority of the
population is in misery.
The gap between the rich and the poor Nations is widening, just
as Karl Marx had pointed out over a century ago: ".... Just as the
bourgeoisie have made the country dependent on the towns, so it
has made barbarian and semi barbarian countries dependent on
the civilised ones, nations of peasants on nations of 'capitalists' ,
the East on the West". Today, he would have used different
words; He would have said the South on the North, and he would
not have made the distinction between barbarian and civilised,
because, as we know now, there is no difference in substance.

CHAPTER XX.

CONSUMERISM, THE DEVELOPMENT OF CREDIT.

********

With the development of credit for the majority of consumers,

capitalist economy found a temporary and partial solution to the
problem of overproduction and surplus capital. The capitalist, with
the dexterity of an illusionist, has played the greatest confidence
trick in history on the gullible, ignorant mass of society. This
device shows the natural business cunning of the merchants and
the typical logic that follows from the laws and mechanism of
capitalist economy.
To put it in simple figurative terms, the capitalist was not going to
raise the wages of his employees to allow them to buy the surplus
of goods which was produced; but he would instead lend them the
money to enable them to become a market for his wares.

The poor 'donkeys' were very grateful, and the capitalist, using a
little ink on his ledger, killed two birds with one stone and put in
motion again the stagnant cycle of capitalist production and
accumulation; This time with even more energy and speed than
before.

There was profit to be made on the sale of the goods, and, in the
same transaction and for the same commodity, an extra profit for
the loan of the money.

But this was not all: by this stroke of the pen on the credit side of
his ledger, the capitalist merchant forged a new chain for the
worker. It is a chain of gold, but much stronger than the old one.
To buy a commodity on credit is like a chain that the worker
willingly puts around his neck: not only he has to sell his present
daily labour power, as in the past, but he also sells his future
labour. He commits a certain amount of his working time for a
certain number of years to repay the debt he has incurred for the
purchase of a commodity.

With this new economic device the person in debt, by selling his
peace of mind and his little independence, shed some of his
former material poverty, but by mortgaging his future he is forced
to work harder and produce more.

For a time, the accumulation of profit almost doubled for the

merchant and the money lender, and the worker, even if
materially a little better off, became less proud and more
submissive: A part time slave, chasing his own tail on the
capitalist treadmill.
In essence, as we have seen, the capitalist must get in return
more than he gives out. With consumer credit he gets a profit for
the commodities he sells, and a profit for the credit he advances.
But no matter how many deals and convolutions the invested
capital is subjected to, and no matter how many capitalists are
involved, all their profits, as everything else, must ultimately
come from the sweat of the working man. Therefore, it should be
evident that while the labourer is allowed to buy more of what he
produces, he also must eventually work and produce a lot more.
Yet, the majority of people are very grateful for being allowed to
get into debt. They have been made to believe that if it was not
for consumer credit we would have nothing. This is quite true, but
only in the context of capitalist economy and merchant logic, not
natural common sense.

This, in very simple terms, is the main essence of 'consumer

credit', one of the elements which constitute the scourge of
consumerism.

Consumer credit for the general public began to develop in the

thirties, and it became widespread after the Second World War.
During the period after the Great Depression Capitalism had lost
credibility; therefore, at the same time as consumer credit was
developing, there was a shift from a 'laissez faire' capitalist
economy to a degree of government intervention to reduce
unemployment and improve the standard of living of the
population. It was a compromise between a free enterprise and a
State controlled economy. In some countries this trend developed
through a democratic process, in others through fascist
dictatorships.

The boost that consumer credit could give to market demand

could only be of a short duration. It should be evident that sooner
or later one must stop buying on credit, or one will become over
committed. If this occurs, then such person will have to stop
buying anything but the bare necessities until he is out of debt.
Therefore, after a buying spree on credit there is normally a long
period of under consumption.

It should be obvious that to be in debt it is to gamble with one's

own future, because when one sells his future labour to buy
commodities, one has no guarantee of future employment or
good health; hence the fear and insecurity, whether conscious or
subconscious, that derives from being in debt.

A society in debt is an insecure society, and many of the major

social ills and frustration derive from this new device in capitalist
economy.

Many people of limited means, after struggling for years paying

for the necessities of modern life, will swear to never put
themselves in debt again. They will put up with their old fridges,
TV sets, etc. for as long as possible, and live a more peaceful life
without having to worry all the time about monthly repayments.

Such a trend, which the merchants call 'consumer resistance', is

too dangerous for a consumer economy to be allowed to set in.
Therefore, a two pronged attack has been mounted against this
public resistance; an attack that is going on relentlessly all the
time to maintain artificially the market demand: putting people in
debt through advertising and planned obsolescence.
 CHAPTER XXI.

CONSUMERISM, ADVERTISING.

********

There is a difference between the straightforward advertising of a

product's objective qualities and specifications, and the present
pervasive pushing of commodities and services without
consideration for truth and social consequences.

But such is the present attack on the minds of the general public
by the 'merchants of dreams'.

Having saturated the markets and exhausted all known forms of

competition but open warfare, the capitalists are reduced to steal
customers from each other and try to reduce the public into
consumption addicts.

To stimulate sales, every commodity must become an ideal and a

symbol: every superfluous or even obnoxious thing must become
a necessity, a question of life and death to possess. We must find
the elusive end of the rainbow, and the obtainment of sublime
happiness behind the purchase of every commodity. The act of
buying had to become a festive ceremonial of self satisfaction and
achievement.

With this assault on their minds, the public, beginning with the
children, is being reduced into a state of moronic stupidity: actors
in a world of make believe in which the only reality and the
ultimate purpose is the sound of the cash register in the capitalist
market place. Behind the sparkle of the shopping centre, behind
the glitter of the shop windows, and behind the artificial plastic
smiles of the advertiser and the salesman, society is becoming
harsher and more insensitive.

Moreover, as at a tender age a person cannot separate reality

from fiction, it is the minds of children that is being irreparably
devastated by this assault by the capitalist merchants and his
servants : 'The Hidden Persuaders' (Vance Packard).

The task of the 'hidden persuaders' is to convince everybody,

including themselves, that we should buy everything that comes
into the market; that this is what we want and is in our interest to
do. These are some of the more evident results : the change of
the Human race into a race of compulsive consumers by keeping
every man woman and child in a state of continuous imbalance,
never satisfied for long with what one has just bought, always
desiring something else, in a continuous state of want and
imaginary scarcity, feeling always poor, no matter how rich and
bloated one may be; All this for the main purpose of creating and
keeping alive an artificial unnatural market for capitalist
production.

As a state of almost general and permanent indebtedness creates

social problems, as everyone except the capitalists will agree, a
state of continuous want and frustration, especially when the
majority of society is not in the position to be able to satisfy all
these new wants, must cause personal and social pressures
detrimental to good human relations.

The result is a society of people who are all acting a part, living
for unobtainable dreams, always dissatisfied no matter how much
they may have, all being busily absorbed in a competitive rat
race in which all individuals are drawn apart from one another.
Everybody is chasing after dreams represented by commodities
the wealthy with the attitudes of paupers and misers.

But even advertising, like consumer credit, can only give a limited
and temporary boost to a faltering capitalist economy: there is a
limit to what people can spend and borrow; moreover some
people cannot be fooled all the time and sooner or later they may
realise how stupid they have been made to look. Consequently,
another more effective device had to be found to keep the cycle
of production in motion and the profits coming in: this new
economic stimulant is euphemistically called 'planned
obsolescence'.

CHAPTER XXII.

CONSUMERISM, PLANNED OBSOLESCENCE.

********

As we have seen, advertising has developed into a socially

obnoxious feature of capitalist economy. It is like a drug being
pushed on the public to make everyone a craving compulsive
consumer.

But just in case that advertising may not be effective on some

sections of the public, or just in case that some people may resist
the pressure and drop out of the rat race, the capitalist has
devised a method by which he uses his servants, science and
technology, not to produce goods that last, but goods that fall
apart or break down after a scientifically determined short space
of time. Many of these commodities are made in such a way that
they cannot be taken apart and repaired.

As new commodities continually invade the market, because of

competition between the capitalists, so they quickly disappear
from existence not long after they have been bought. This new
economic device is euphemistically called planned obsolescence.
Its prime purpose is the same as advertising, but it is more like a
weapon than a drug a weapon designed for the systematic
destruction of commodities. Therefore, it is far more effective
than advertising in forcing unwilling customers towards the
market place.

It is the quintessence of the waste of labour power, energy and

resources, and the consequent despoliation of our environment.

Moreover, planned obsolescence nullifies the advantages to

society that should come from the rise in production, because
while the cost of production and consumer goods has been
decreasing in relation to our incomes, we are forced to buy the
same goods far more often than before, as their life span has
been shortened.

While most products are cheaper than in the past, we are forced
to buy them more often. Therefore their use is just as expensive
as before if not more. But we should know by now that the whole
cycle of capitalist production is oriented towards profit and wealth
for the capitalist, not the advantage of society. This may come as
a by product of profit, if it comes at all, or it may come irrationally
twisted into a disadvantage.

The capitalist, without giving us a choice, has instinctively

decided that we should have 'planned obsolescence' because, as
he explains, given the fast technological changes there is no point
in making things that last. The public, they say, must have the
best and latest commodities as soon as they appear on the
market, and, besides, it is planned obsolescence which provides a
lot of people with work.

It is difficult to find fault with this logic which springs from

capitalist economic necessity: the necessity of the merchant in a
saturated market environment.

It is the new problems of endemic overproduction and market

saturation, that Adam Smith and Karl Marx would have considered
absurd, which create the necessity to continually clear the
markets for new commodities, to maintain in motion the cycle of
capitalist production: investment of capital in the production of
commodities, their sale in the market, realisation of profit,
increase of capital, more investment in production of
commodities, and so on. As Capitalism finds more and more
difficulty in finding new markets for increased production,
turnover is accelerated in the existing markets by limiting the life
of the commodities being sold. In this way the rate of production
is maintained.

The public is not the end, it is just a necessary incidental in the

process, to be manipulated to suit the needs of the mercantile
system.

We witness, today, the complete perversion of rationality and

common sense: not an economy suited to the needs of society,
but a society sacrificed to the needs of an obsolete economy. The
first symptoms of this perversion were already evident at the
beginning of Capitalism, as Adam Smith pointed out over two
centuries ago: " Consumption is the sole end and purpose of all
production,... .....But in the mercantile system, the interest of the
consumer is almost constantly sacrificed to that of the producer;
and it seems to consider production, and not consumption, as the
ultimate end and object of all industry and commerce..."

We must remember that the word "consumption" has assumed a

new meaning since Adam Smith's times. In that age of scarcity
the word implied the use of commodities for their utility; and
waste was considered a sin. Today, consumption is mainly related
to the act of buying in itself with little consideration for usefulness
or benefit, and has the connotation of waste.

This is what Adam Smith stated should be the rational intention

and purpose of an economic system:

"Political economy . . . proposes . . . first to provide a plentiful

revenue or subsistence for the people, or more properly to enable
them to provide such a revenue or subsistence for themselves...."
But today, in the present unnatural stage, Humanity and the
planet Earth are being sacrificed to the economy for the
momentary self interest of the modern merchants and
manufacturers and their entourage, ten percent of the world
population.

Another wasteful and polluting device to increase investment and

profits is one certain aspect of the retail industry. It mainly has to
do with "packaging"; packaging can be convenient and is an
important part of salesmanship, but it is also a mean of "adding
value" to the commodities and forcing the public to buy more
than it needs and also to buy a lot of plastic, paper and cardboard
that it does not need at all. For the capitalist businessmen it is a
new opening for investment of capital; a new profitable industry
which transforms natural resources into a pile of rubbish.

This is a short and general description of one of the new aspects

of modern Capitalism : 'consumer credit', 'high pressure
advertising' and 'planned obsolescence', these constitute what
today is called 'consumerism', a word which, personally, I resent
and despise. To accept such a denomination and such a situation,
of being a consumer in a consumer society, is to accept the
gradual transformation of Human beings into creatures with a big
mouth at one end, a large anus at the other, and no brain in
between, all clean and 'whiter than white', sitting on a heap of
waste and smelly effluent which once was a beautiful planet, our
Mother Earth.

It should be evident that the scourge of 'consumerism' is the main

cause for the waste of energy, raw materials, labour power, and
the systematic destruction of our environment; and consumerism
is the direct result of the irrational and inequitable development
of modern Capitalism; I said 'inequitable' because while a minority
of the world population and their pets over-consume and waste,
they also suck materials and resources from the under-developed
parts of the world where entire populations live in poverty and
millions succumb to starvation.

To conclude this subject, we must consider another contradiction,

arising from the development of consumerism, that cannot be
resolved within capitalist economy: while the workforce, which
constitutes the majority of consumers, is being pushed by the
advertising industry on behalf of one section of the capitalists to
buy more and more, they are at the same time subjected by
another section to a continuous pressure to produce more and
more, and to continuous attempts to lower their real incomes and
buying power.

Having devised the philosophy of "The Virtue of Selfishness ", the

apologists of Capitalism would have today the unenviable task of
inventing also the philosophy of 'The Virtue of Irrationality'.

CHAPTER XXIII.

THE TRANSNATIONAL CORPORATIONS

AND THEIR INFLUENCE ON THE WORLD ECONOMY.

********
Another new aspect in the present stage of evolution of the
capitalist system is the supra nationalisation of the world
economy, brought about by the development of the transnational
corporations.

During Capitalism's early stages, capitalist businessmen were

competing against one another mainly in their own national local
markets.

As Capitalism expanded, in the rush for foreign markets and raw

materials, they found themselves competing against the
capitalists of other industrial countries, often under the political
and military protection of their respective governments. A race
began to develop amongst Industrial Nations for the control of
those parts of the world that were still undeveloped or weak.

This nationalistic competition for markets and resources was one

of the main causes of friction and jealousy between Nations. It
was also the cause for many wars during the last two centuries.

The gradual development of monopolies, cartels, and now the

transnational corporations has to a great extent eliminated the
nationalistic features from capitalist economy. Therefore, the
probability of all out warfare between capitalist Nations has been
almost eliminated. The inextricable links of the corporations and
world finance transcend all national boundaries. Capital has no
nationality.

As we have seen earlier, the development of monopolies, cartels

and corporations was inevitable. The nature of capitalist
production and competition promotes the accumulation of capital
in ever fewer hands as Marx had stated over a century ago:
".....That the small industrialist cannot survive in a contest one of
the first conditions of which is to produce on an ever greater
scale, that is, precisely to be a large and not a small industrialist,
is self evident".
The next logical consequence of the accumulation of finance and
technology in the hands of few corporations is their diversification
in different fields of activity, and their expansion throughout the
world. Their political power grows in direct proportion to their
economic power.

There is a deep analysis of the present development of the

corporations in a work entitled "Global Reach" by Richard J.
Barnet and Ronald E. Muller. The authors explain many important
aspects of the corporations and their influence in world affairs and
on the lives of individual persons. What the transnationals are
promoting today is a trend towards the integration of capitalist
economy under their effective control, and mainly for their own
maximum profit.

They have lost almost completely their original national identities

and loyalties. They have become international in their
organizations; they are conglomerates that unite capital and
technological knowhow from all the industrial countries of the
world. They view the world as one entity as a global field for their
activities.

One of the main effects of the transnational corporations on the

world economy is the transfer of entire industries and production
from countries with relatively high wages and standard of living to
countries with abundant cheap labour still unspoiled by long union
traditions.

This transfer of production to depressed areas of the world has

been a feature of capitalist economy for a long time. It is part of
the general drive to increase the productivity of capital and
labour. But in the early stages, for many different reasons, this
mobility was not always easy or possible.

This movement of productive forces became more accentuated

after the Second World War, mainly from the United States to
Europe and Japan, then from these countries to all parts of the
world. This was not by any means a one sided push by the
international bankers and corporations, it was also the desire of
the developing Nations to be developed, even by the
corporations.

This great exodus of industry is having a worldwide leveling

effect: it tends to produce unemployment and to reduce the
wages and standard of living in the developed countries, and, at
the same time, it increases the level of employment and, if the
corporations are not too greedy, also the standard of living of the
underdeveloped countries.

There is possibly one exception to this exodus of industries from

the developed countries. For reasons of national security, the
armament industry is kept at home while some others are
exported. The arms industry, therefore, may tend to assume a
great proportion of the internal economy of such countries.

The world wide equalising effect of the transnational corporations

could be considered beneficial towards uniting the Nations of the
world, if it was planned and intended for the benefit of the whole
of society. It is unfortunate that most of our clever business
leaders are so narrow minded and lacking in wisdom; the main
purpose of this transfer of production is the immediate vested
interest of the corporations to maximise their profits on a global
scale. To this end they must take more than what they give
wherever they are and wherever they go.

Their philosophy is still the 'mercantile' philosophy, and their

means is still a destructive consumerism. By changing the
motivation of their executives and the programming of their
computers from consumerism and waste to usefulness and
conservation, the transnational corporations could become the
embryos of a worldwide rationally planned economic system, as
they are already autonomous organisms with self sufficient
planned economies.
It is because of their capitalist nature and the saturated market
situation, which they are themselves aggravating, that instead of
Human progress, often they bring more hardship to the
populations of the industrial countries, and even more hardship to
the Nations which are trying to become industrialised. Instead of
uniting the world, they are frightening most countries into the
economic, social and racial antagonism of the trade war.

What has happened in Europe since the World War II is partly the
result of capital losing its nationalistic identity.

Immediately after the war, during the reconstruction, the US

corporations invaded the whole of Western Europe with
investment capital. They did not discriminate between any
countries; They instinctively built economic bridges across all
nationalities; They helped to weaken the pre-war nationalistic
features of capital and so they facilitated the advent of European
capitalism; Therefore national geographical boundaries became
impediments to the flow of capital, commodities and labour.

We can see this trend all over the world, but it is not rationally
planned with the benefit of the Human race and the planet Earth
in mind. Therefore we may end up with several economic blocks
competing against each other with great consequent dangers.

There is also a possible hidden danger in the development of the

transnational banking corporations in particular: whichever
corporation or Nation that acquires control over a great
proportion of international finance can use this power to tax the
rest of the world for its own particular benefit and its own
purpose.
 CHAPTER XXIV.

CLUES ABOUT INFLATION.

********

At this point we should consider one of the most important

feature in the present stage of capitalist development; this is the
constant upward pressure of inflation sometimes coupled with
endemic unemployment (1975-1983).

Inflation is not new to the capitalist system, nor is unemployment,

but they seldom occurred together.

It is evident if we look at prices increases or the value of money

over the last two centuries that there must be natural factors
deep within the mechanism of capitalist economy that produce
inflation. It has been a constant feature of the system since the
beginning.

It is very difficult to pinpoint the prime causes of inflation,

because in a vicious circle causes and effects often become
confused with one another.
From what we hear in the mass media, we are made to believe
that rises in wages are almost exclusively to be blamed as the
cause of inflation. But, as we know who influences the mass
media, we should not be surprised if even in this respect the
"sophistry of merchants and manufacturers" has succeeded in
confounding the common sense of the majority of people.

Even Milton Friedman, the mastermind of monetarism and the

author of its master plan "Free to Choose ", clearly states that
rises in wages are not so much the cause but rather the result of
inflation: A statement that his followers ‘freely choose’ to ignore.

If we trust Adam Smith and his analysis of early capitalist

economy, a rise in profits and interest will tend to boost inflation
more than a rise in wages: ".....in reality high profits tend much
more to raise the price of work than high wages...." He goes on
explaining that an increase in wages raises the price of
commodities only in arithmetical proportion, while the same
increase in profits will cause a rise in geometrical proportion. He
Continues by noting that: "...our merchants and master
manufacturers complain much of the bad effects of high wages in
raising the price, and thereby lessening the sale of their goods
both at home and abroad. They say nothing concerning the bad
effects of high profits. They are silent regarding the pernicious
effects of their own gains. They complain only of those of other
people...."

We have fairly accurate statistics about the average level and the
fluctuations of wages, but seldom we are told about the level of
profits; possibly because it is very difficult to ascertain. But even
on this respect Adam Smith comes to our help. He states that,
although profits are difficult to verify, there is in the economy an
indicator of their general level. He states that:

". . . It may be laid down as a maxim, that wherever a great deal

can be made by the use of money, a great deal will commonly be
given for the use of it; and wherever little can be made of it, less
will be commonly given for it. According, therefore, as the usual
market rate of interest varies in any country, we may be assured
the ordinary profits of stock must vary with it, must sink as it
sinks, rise as it rises. The progress of interest, therefore, may lead
us to form some notion of the progress of profit......"

If we accept this maxim, we can guess that, as interest rates have

increased during the recent past, so must have profits, if not for
all capitalists at least for most, or for the bigger ones.

Evidently there are many factors which promote inflation, and any
one or any number of them could be at work at different times.
But there are some basic factors which are always present.

Going back to the law of demand and supply, we can be sure that,
because of the ever present compulsion to control the supply of
commodities and the market, the price of the commodities will
linger much longer above than below the " natural cost of
production ". Consequently, over a length of time, the average
price of commodities, although gravitating towards, will seldom
coincide with the cost of production, but will stay slightly above it.
This feature is built into the mechanism of the system.

An increasing and excessive demand for goods and services tends

to create what we call 'demand inflation'. This type of inflation is
not caused by an increase in the cost of production, but by the
natural expectation to maximise profits during a situation of
scarcity. We should not be surprised if capitalist businessmen
never complain about this type of inflation: it is good for their
profits, and profit is the kingpin of their merchant economy and
the centre of their philosophy. This type of inflation is seldom
publicised and deprecated in the mass media. In contrast all we
hear about are endless complaints about 'cost inflation' and the
cost of labour in particular. But demand inflation and cost inflation
are, in essence, the same.
In the first one, the capitalist takes advantage of a real or artificial
scarcity of commodities to increase prices and profits, and this,
we are told, is O.K. In the second, the working man takes
advantage of a real or artificial scarcity of labour to increase his
wages, the price of his work, and this, we are told, is catastrophic
for the economy and society.

The capitalist has many justifications for this double standard, but
they only prove that Capitalism is a double standard socio-
economic system: what is good for the capitalist is good for the
economy and society, what is good for the worker is not.

Increasing demand for his commodities is the great dream of

every capitalist, but this situation usually produces an increasing
demand for labour as well, and this, while it is the dream of every
worker, it is also a nightmare for the capitalist. This is a
contradiction and a great dilemma in capitalist economy. Here is
a typical example from an article in the Sydney Morning Herald 15
February 1992, at the lowest point of a recession "that we had to
have" to cut inflation; here the Minister for Finance warns about
the danger of rekindling inflation, deriving by proposed extra
government expenditure to kick-start the economy and to relieve
unemployment: "..It was crucial for the Government to convince
financial markets that inflation would be kept under control,
despite increased Government spending....Mr Willis said a large
drop in the exchange rate would force the Government to
increase interest rates. The Government would then have to
"squeeze the economy hard to make sure you don't have it" (high
inflation), and this would mean "a lot more unemployment..."

This is a great dilemma and contradiction: capitalist governments

are reluctant to lower unemployment for fear of inflation.

Unemployment tends to lower wages and the cost of production,

but also it reduces the effectual demand for commodities as the
buying power of the workers is being reduced. Therefore it
creates more competition amongst the capitalists, therefore lower
profits, and some go broke. If the capitalists can sell overseas the
goods that their home market cannot buy, well enough; if they
cannot, then there is no solution to their problem within capitalist
economy. Then, wages and also prices must be regulated as it
was done in fascist Italy and Nazi Germany before the war.
Capitalists are always in favour to regulate wages when there is
no unemployment, but they will never accept regulation on
prices. Obviously, they are not in favour to regulate wages when
there is unemployment because, in this case, they can force
wages down further than any regulation.

All types of speculative activities tend to create demand inflation.

We should remember how speculation on land and buildings

during the seventies and the eighties was one of the main causes
for the increase in the cost of land, construction materials,
dwellings as well as wages.

Another cause of demand inflation is that whenever anyone

succeeds in controlling the supply or the distribution of
commodities through cartels, monopolies or secret agreements,
one will set the prices to " what the traffic will bear ", that is the
maximum that customers are able or willing to pay, as Adam
Smith stated: "....the price of monopoly is upon every occasion
the highest that can be got.."

It is the obvious scope of monopolies, cartels and corporations, or

any capitalist for that matter, to be able to control the supply of
commodities to the market or at any stage of production in order
to raise their prices and their profits. This is nothing else than the
purposeful creation of demand inflation.

In conclusion, it is evident that individual selfishness is at the

base of demand inflation, and Capitalism is based on individual
selfishness, but there is a very short step from this capitalist
"virtue" to greed and blindness.
As we have seen earlier, 'cost inflation' is in essence very much
the same as 'demand inflation'. These are two different names for
what is basically the same thing, except that one refers to the
capitalist, the other to the worker, and the capitalist and the
worker have a different relation to the means of production.

In capitalist economy labour power is considered to be a

commodity that is essential for the production of all other
commodities. Therefore, every increase in the cost, or wages, of
labour increases the cost of the commodities produced.

But the law of demand and supply forces the labourer to try to
improve his conditions whenever there is an increase in the
demand for labour; this is the only time when he has an
advantage and any chance to improve his standard of living
within capitalist economy. He knows very well that when the
demand for his services decreases, he will be promptly pushed
backwards; his employers will have then all the advantages,
which they will not waste in their continuous drive to maintain or
increase their profits while they are pressed by competition.

The unrelenting pressure for higher wages is natural within

capitalist economy, the same as the continuous drive for higher
profits. Evidently the capitalist has the advantage. The labourer
must be on the defensive most of the time. Except during
economic expansion when workers have some leverage, most
wages demands are determined either by an increase in the
productivity of labour or by the continuous necessity to maintain
the purchasing power of wages against inflation.

What the capitalists complain about all the time is, in essence, the
continuous struggle of the workforce to keep up with the cost of
living, and their resistance against the employers' relentless
attempts to extract more production from them.

There is nothing that influences a push in wages and inflation

more than a rise in the price of essential commodities and
services like food, housing, transport, etc., the means of
subsistence for a worker and his family, which is the cost of
producing and maintaining a worker. Capitalists do not whinge so
much for the acquisition and maintenance of their machinery as
they do for the acquisition and maintenance of their worker
Human beings.

Today, with new machinery and efficient storage systems, even

staple foods and once perishable commodities can be stored and
released at will; essential commodities can be subjected to
monopoly control. The Stock and Futures markets have an
important influence on the cost of living; entire crops are bought
and sold over and over again even before harvest. In the end, if
prices are not profitable, the produce can be stored and a
situation of scarcity can be artificially created until prices will
increase enough to allow the last speculator to make a profit.

Scarcity, whether real or artificial, creates 'demand inflation', and

the cost of living goes up. Consequently, the workforce has no
alternative but to press for increases in wages, and this in turn is
translated into 'cost inflation'.

There are worldwide cost pressures over which individual

countries have no control, for instance the price of foreign oil. But
even in this respect, as the capitalists have a commanding
position in the economy, they manage to pass downward cost
factors of this kind most of the time, forcing those at the bottom
to bear most of the burden.

Rises in taxation are also a cause of cost inflation, especially

taxes on essential commodities. These should never be taxed,
but, unfortunately, taxes on necessities produce more revenue
than taxes on luxuries.

In the present stage of capitalist evolution, some factors of cost

inflation, which were insignificant in the past, have been
accentuated by the changes in the structure of capitalist
economy.

There is the increased burden of social services and

unemployment benefits which were minimal in the past.

There is the waste of energy and resources that has to be paid for
by society.

Another of these new factors is the proliferation of services both

public and private. As technology and automation have been
advancing, the workforce directly employed in production has
been decreasing in relation to that employed in the service
industries.

There is some control over services provided by the State,

because they are subjected to some public scrutiny. Some of
these services are essential to promote and maintain a healthy
society; some are for the benefit of industry and commerce, they
provide for the general needs of the economic and social
structure; some are for the protection of private and public
property. But government services or 'government bureaucracy'
are only a part of the total overhead of capitalist economy.

There is no Public scrutiny or control over the 'private

bureaucracy' of the system. Banking, insurance, commercial
institutions, property law, advertising, etc. are the overhead in
the system of capitalist production. Therefore they can be
considered to be the private, much duplicated, bureaucracy of
capitalist economy. But, thanks to the mass media, this aspect is
never publicised.

There are two bureaucracies: government and private, but what

we hear most of the time are complaints about government
bureaucracy; We never hear about the other, and its effects on
prices and inflation, nor about the proliferation of those services
which cater for the rich's more expensive life styles and for their
increasing needs for security.

There are new service industries coming to life all the time, They
strive for self preservation and expansion, as it is in the nature of
all living organisms, and they tend to promote the environment
which has brought them to life.

One of these for instance is a new growing private army providing

sophisticated security services to protect the persons and
property of the wealthy from increasing organised and petty
crime. Private and public buildings have been transformed into
virtual fortresses with guards and expensive electronic security
devices.

The cost of all these services, essential or superfluous, must in

the end come from profits or wages: they must be added to the
cost of production. But as labour must ultimately provide for all
revenue, wages, rents and profits, it is the working man who
eventually must foot the bill.

Another service industry which has expanded out of all proportion

is the retail industry. Vast and expensive new shopping
complexes, like temples to the art of selling, have been rising
beside the traditional 'main street' shopping centres. Their cost,
the piped music, air conditioning, side shows, etc. must be added
to the cost of the commodities being sold in them.

Inflation breeds inflation. If retail outlets increase in numbers, but

the buying power of the public remains the same, it means that
the overhead costs will increase in relation to the volume of sales.
If the rate of profits and wages has to be maintained, the price of
the commodities must rise. But this rise in prices will lower further
the volume of sales, while the overhead costs remain the same.
Another price increase becomes necessary, and so on as in a
vicious circle.
This trend which is a symptom of the saturation of the economy
has been going on for many years. As less people are needed in
production, more and more people become involved in selling and
other services.

The economy has become top heavy; a contracting productive

work-force has to carry an ever expanding unproductive load; and
it is the poor 'donkey', the worker that is still being belted and
cursed.

There is a hidden cause of cost inflation which is little publicised

and is related to the present stage of capitalist evolution. Because
of the development of automation, production has become capital
intensive and the factor of wage labour is diminishing. This is one
of the reasons why sometimes we have inflation and
unemployment at the same time.

In the past, when production was labour intensive, if the volume

of sales dropped, production was curtailed by sacking a part of
the workforce. As sales and production diminished so did the cost
of wages, and the cost of commodities at the point of production
was not affected to any significant degree. But in a situation
where production is capital intensive, where automatic machinery
is mainly employed, or when there is a heavy debt burden, if a
drop in the demand for commodities occurs, the capital invested
in equipment and machinery and other overhead costs remains
nearly the same; there are no workers to be sacked, as they have
been replaced by the machines. The overhead cost will remain
almost the same as when there was full production, and this cost
will have to be divided amongst the fewer commodities being
produced and sold.

Technology becomes cheap only when it is used on a large scale

to full capacity to produce and sell a great quantity of goods.

Another cause of inflation is the factor of high interest rate, or the

high cost of borrowed money. Interest, the same as profit, adds
up in geometrical proportion in the overall cost of production and
the price of commodities. There are many reasons for high level
of interest in the present stage: governments borrowing to
finance their expenditures, speculation, pyramid borrowing, high
interests to attract foreign investment, concentration of finance in
few hands, defaulting on large debts, etc.

The main underlining reason is that after three centuries of

mercantile influence we have accepted the aberration that money
is a commodity in itself, more important than labour, not just a
means to facilitate the bartering of all goods and services.

We live in a merchant socio-economic organism, and no one has

more status than the merchant of money. We have accepted the
false premise that nothing can happen without money, and we
have turned it into reality. Now we are prisoners of this mercantile
assumption.

Another important cause for inflation is the increasing cost of

armaments and defence that must be paid by taxes. And to
conclude we should also consider the influence that consumerism
has on inflation.

Consumerism puts more pressures on the workforce to seek

wages increases. These pressures are exerted in different ways;
by putting people in debt, it increases for them the real cost of
commodities, that is what they have eventually to fork out for
them; by shortening the life span of commodities, it indirectly
increases the cost of living; by needling everybody with high
pressure advertising, it increases their desires for more
commodities than they can afford with their present wages.

These are only clues and logical deductions about some of the
main causes of inflation, but I believe that they are very close to
the mark.
 CHAPTER XXV.

UNEMPLOYMENT.

********

In the course of the discussion we have already touched in

passing on the subject of unemployment. We have seen how it
plays a very important part in the mechanism of capitalist
production.
Fear of unemployment is one of the main motivations that compel
the working man to compete for jobs, and to submit to any wages
and conditions rather than to be left out of work. Without the
prospect of unemployment this fear tends to disappear, and the
workforce becomes too strong and independent for the capitalist
comfort.

Capitalism needs a permanent reserve pool of cheap labour for

production. At the same time it needs consumers with money to
spend or with reasonably secure employment prospects that
permit them to buy on credit. This is one of the main
contradictions in the present stage of economic evolution.

Employment levels seem to follow general patterns determined

by profitability and convenience for capital investment, whether
in relation to national local markets or in relation to the world as a
whole.

These are the main factors that have determined the

establishment of centres of industry and commerce: large and
relatively wealthy populations constituting a growing market; a
plentiful supply of skilled and unskilled labour, availability of raw
materials and sources of energy; ruling elites or governments
which favour the establishment of capitalist industry and
commerce; closeness to trade routes that link markets and
sources of raw materials.

Western Europe was the part of the world where capitalist

industry and commerce first started to grow. There was a plentiful
supply of labour, because at the same time when industry was
beginning to grow, many people were forced out of the feudal
lands and they were attracted towards the new industrial centres.

For centuries this was the pattern in the developing industrial

nations: growing populations in the cities, a continuous supply of
country people to feed the needs of the growing industries.
In the past, when an industry became established, it could not be
moved easily to other areas. Industrial centres had an aspect of
permanence and stability. But, in the quest for profits, mobility
has always been essential; nothing can stand still, nothing can be
left to interfere with the freedom of capital. If capitalist industry
could not be moved, then the workforce had to be moved to it;
when local labour was not suitable, or was unwilling, then
immigrant labour or even slaves had to be procured.

As capitalist industry and commerce established themselves and

became concentrated wherever the best conveniences and
opportunities were available, various employment patterns
developed in different regions of each country.

Some areas became industrialised, with increasing opportunity for

employment, while other areas remained undeveloped. The latter
became a reserve of cheap labour and cheap produce for the
former. Generally speaking this was the pattern of
industrialisation and employment in most countries.

The same pattern can be observed if we look at the world as a

whole some countries where the general environment was
favourable became industrialised, and some other countries
remained undeveloped and depressed.

Directly or indirectly, unemployment has been an important factor

in the history of capitalist development: even for the most
industrialised countries, a steady supply of unemployed people or
migrants has always been readily available.

During the recent past, as technology has revolutionised

production, communication and transport, capital has acquired a
great mobility. Therefore, industrial and employment patterns
have started to shift.
Nations that recently have acquired independence are trying to
build their own industries, and it does not take very long today to
build a new industrial complex anywhere in the world.

Industrial plants that were built yesterday may become obsolete

overnight. As the technology of production is changing very fast,
it is sometimes more profitable for capital to abandon a long
established plant that is becoming obsolete, and build an entirely
new one somewhere else in a depressed area where labour is
cheaper and unspoiled by old union traditions.

In this way a new trend has been set within each country and
throughout the world: industries are disappearing from long
established industrial areas, and they are reappearing with new
technology in the more depressed regions of the world where
there is unemployment and capital investment is more profitable.

As we have seen earlier, the transnational corporations have

greatly accelerated this process which is leveling employment
patterns throughout the world.

This process is very clearly explained in "Global Reach", a book

that was mentioned earlier. It is stated there that ".... the United
States trading pattern is beginning to resemble that of
underdeveloped countries....., having exported some of its
industries to the export platforms of Hong Kong and Taiwan ", it is
importing now more and more manufactured goods that before
were produced at home.

To pay for these imports, it has to export more and more of its
"agricultural products and timber". Moreover, unemployment is
rising and the gap between rich and poor Americans is widening.
To compete against imports produced by cheaper labour in
modern factories built by the corporations in foreign countries,
American Workers are accepting cuts in wages and conditions,
and many of these transnational corporations are dominated by
very 'patriotic' American capitalists.
This trend is going on throughout the world, and as it is leveling
out the high employment patterns, without greatly improving the
low ones, unemployment is becoming endemic in the developed
nations as it is in those that are underdeveloped.

If we add to this general trend the effects of automation and the

gradual saturation of the markets, the picture becomes even
more grim in relation to future employment prospects.

Unemployment in the present saturated situation seems to

produce a trend towards more unemployment. First of all, people
have less money to spend. Moreover, those who still have a job
work harder and become more productive. As the fear of being
thrown out of work increases, competition and antagonism among
the workforce also increases, racial prejudice is accentuated by
insecurity. More work is done by fewer people, and thus the
chances for employment diminish even further for those who are
out of work.

In the public service sector the situation used to be slightly better

until privatisation, outsourcing and bonuses became the trend,
civil servants became upstaged by private “consultants”.

Employment there used to be more secure, amongst other

reasons because whichever government was in power, it could
not afford to create too much enmity towards itself within its own
instrumentalities. Generally speaking this is not the case
anymore.

Another factor which increases unemployment to a certain degree

is the trend towards subcontracting to the workforce all work that
was previously performed by wage labour. Each tradesman
becomes his own task-master, he produces several times more
than when he was working on wages. He becomes involved in a
race against the other subcontractors, his former workmates, and
also against himself. He also begins to disregard safety and
working conditions that previously he may have considered
essential.

To sum up, unemployment has always been a feature of capitalist

economy, and an essential part of its mechanism, but its level has
varied from time to time and from place to place.

Several times in the past, Capitalism has been in danger of being

destroyed because of high levels of unemployment and poverty.
In the decades following the First World war, it was saved by the
intervention of Fascist dictatorships; then by the turmoil and
destruction of the Second World War; afterwards, during a period
of reconstruction and great expansion, by the illusion that
Capitalism and technology would solve the problems of poverty in
the world by providing employment for all; a promise that
Capitalism, because of its very nature, can never fulfil.

During the last two centuries, 'the right to work' has become the
most important issue and expectation in western societies. But
this is only a recent development. Before the advent of Capitalism
in the West, this concept did not exist. It was the 'right to life',
whether openly proclaimed or not, that was the main natural
aspiration of all Human beings in all previous Ages; By no means
it was a right that was always granted and respected. During the
Middle-Ages, in the Feudal system, this natural primordial
aspiration to live was assured to the mass of the people by their
chartered rights to the use of the land for their own subsistence.
For the feudal serfs and peasants the right to live was intimately
connected with the right to work the land and to share its
produce.

As the capitalist system of production developed in the West, with

its own concept of 'absolute private property', the use of the land
was denied to an increasing number of the population. By denying
them the ancient 'right to the land', they were also denied the
right to live. Therefore, some found work in the growing industrial
centres, but for some there was nothing left other than squalid
idleness, banditry, transportation to penal colonies or the public
workhouse.

As the land became the private property of a minority, to find

work somewhere else became the only way to survive for the
great majority of the population. The 'work ethic' became the
rule, and the concept of the 'right to live' became the concept of
the 'right to work'.

Capitalist "rationalists" today are denying the validity of such a

right. But in capitalist society the right to work is equivalent to the
right to life, and this right is paramount. It is in essence the right
to self preservation and self respect of every Human being.

No system in the world can deny this right for very long. If any
social system cannot fulfil this basic aspiration, it has no right to
exist it must be replaced.

It is evident that Capitalism is failing to provide employment and

a meaningful existence for an increasing section of society. The
economy has become obsolete and regressive. Capitalist
apologists have begun to question the concept of the 'right to
work'.

One sign of regression, pertinent to the subject of unemployment,

is that, while only two decades ago the young generations were
presented with views of progress and opportunity for all, today
their education is being curtailed, and from a tender age, while at
home they are conditioned to grow into compulsive yuppie
consumers by TV advertising, at school they are being prepared
to accept as almost inevitable a miserable life of unemployment
and poverty or, alternatively, some regimented form of
conscripted menial labour.

This is just one of the signs of capitalist regression, a topic that

will be examined in the following chapter.
 CHAPTER XXVI.

CAPITALISM, AN IMPEDIMENT TO FURTHER PROGRESS.

********

Capitalism has long ago reached the limits of its natural

development. No matter how glittering and powerful it may look
in appearance today, it has no substance, no real purpose, and it
holds no definite prospects for the future.

Its natural economic laws and mechanism cannot rationally

function in the new environment which it has helped to create.
Therefore it is evolving in an increasing irrational and dangerous
way.
Space and opportunity for further capitalist development are
decreasing fast, and the limits of Human tolerance have been
reached. Humanity is on the verge of madness.

Capitalism has become an impediment to further Human

progress. It is forcing the Human race backwards, and,
consequently, it has lost the right to impose itself to the world.

These are the reasons.

Capitalism's economic laws, which were naturally tuned to

overcome an environment of emptiness and scarcity, cannot
function in a new environment of saturation and plenty.

Capitalist economy is a machine devised to produce 'plenty', but

for Capitalism plenty becomes a curse.

Because of modern science and technology, themselves part of

the capitalist machine, what is plentiful and free, like the Sun, the
Air, Seawater, may become a danger to the very existence of
capitalist economy.

What is simple and easy has little market value therefore

Capitalism has a vested interest in 'complexity'.

The capitalist merchant will have to solve the problem of making

what is simple, easy, plentiful and free, his private property or
subject to his control so as to be able to make it marketable. It
would be interesting to know how many times, so far, simple
solutions to our social and economic problems have been
overlooked or even suppressed in favour of more complex and
more ineffective ones, only because these were more profitable to
the vested interests of the capitalist establishment. How many
inventions may have been bought out and stored away because,
by eliminating the waste of labour and resources, they would
have threatened capitalist economy.
'Permanency and conservation' will diminish market turnover,
therefore, Capitalism has a vested interest in 'waste and
destruction'. Waste and destruction may follow the logic of
capitalist economy, but they are irrational and criminal in the
context of Human survival. Is there any definite border between
irrationality and madness? The real question is how far we have
already gone in that direction and whether we still have left
enough common sense and the capacity to judge what is rational
and what is not. Will the new generations, born in a madhouse
social and ecological environment, recognise the wrongs and the
damage that we have done to ourselves and our planet? Will they
accept the madhouse situation as normality?

Capitalism depends on 'unemployment and want' to fight inflation

and to raise profits. Therefore, it will never completely solve the
problems of unemployment and poverty. Instead it produces the
greatest wealth for some and the most abject physical and
spiritual misery for others.

Educated poor and educated unemployed people are a threat to

the existence of an obsolete and corrupt society. Therefore,
Capitalism has a vested interest in 'ignorance and
misinformation'. It prefers to deal with ignorant unemployed
people and moronic criminals rather than with educated
revolutionaries. What will happen to a society where the
establishment is ignorant because it does not want to know, and
the rest are ignorant because they are not supposed to know? Is
there any border between ignorance, prejudice and hate?
Humanities, history and social sciences are being discouraged in
capitalist education because they are considered to be
unproductive; commercial technology, marketing and advertising
are promoted; what kind of society will develop if we take
Humanity out of the Human beings?

Capitalism upholds the virtue of 'selfishness' and personal gain,

but this is what puts the capitalist businessman and the criminal
in the same category. Is there any clear border between
legitimate business and organised crime? Or is it only determined
by the degree of cunning and power of those who make and
administer the law?

Is it more criminal to bash a man to rob him of his wallet than to

make millions of children miserable through advertising, unhappy
with what they have, to get at the wallets of their parents, and
make them unhappy as well?

Labour is a troublesome commodity for the capitalists in the

process of production; Therefore, Capitalism has a vested interest
in 'machines'. Technology is gradually replacing the workforce,
but every person out of work is one less consumer on the market.
This means that the capitalist must consume more himself.
Therefore, there is a trend in the economy to produce more
extravagant luxury goods and services than essential
commodities, as it is more profitable to produce luxuries for those
who have money to spare than to produce essential goods for
those who have not. So the rich are getting richer, the poor are
getting poorer.

More people, to find employment, are being attracted to the

personal service of the rich and their entourage. While a few
years ago domestic servants were hard to find, now more and
more people must throw themselves at the chance of servile
employment; 'servile and parasitic' activities are the only growing
occupations in the economy, and a proud Nation tends to become
a Nation of servants and shoeshines.

As the capitalist establishment's lifestyle becomes more

extravagant in contrast with the needs of the majority, so its need
for security increases. This is another growth industry.

At the other end, as technology is making the labour force

redundant, poverty increases and social services, always
considered a burden by the capitalist, become inadequate. A
growing number of people will have to forego the right to work,
the right to basic necessities that were considered inalienable
only a few years ago.

With no prospect of work, the future of entire sections of society

is subjected to the logic of an obsolete and perverted economy.
The wealth of the country and the livelihood of its people are in
the hands of gamblers in the stock and futures markets: they are
at the mercy of the private personal interests of secretive
international financiers and bankers who are not elected but have
power over the elected governments of the Nations.

The promotion of individual selfishness plus ignorance and

poverty is a mixture that produces frustration, vandalism and
insensitivity. Lack of purpose and lack of ideals breeds escapism
and drug addiction amongst the young generations, poor and
rich; and organised crime is taking advantage of this situation.

Long ago 'organised crime' had gained unofficial acceptance as a

provider of services, and today it has become an accepted part of
the capitalist establishment, with its own capital invested in
legitimate and illegitimate business. It shares with its blood
relations, the capitalists proper, the office blocks, the luxury
hotels, the holiday resorts, the glamour of the media, and the
technology of capitalist production.

Organised criminals are amongst the staunchest supporters of the

capitalist system because crime is the quintessence of selfish
personal self interest and free enterprise without the restrictions
of ethics or morals which, in any case, are very thin in capitalist
economy today.

There is evidence of a natural alliance between big business

interests, extreme right wing associations, organised crime and
powerful government enforcement agencies in the defence of
Capitalism and what they call "freedom and democracy". They
seem to surface together everywhere in the world in support of
the most oppressive capitalist dictatorships.

There is another negative and regressive feature in capitalist

economy today. While in the early stages planning may not have
been possible or necessary for capitalist expansion, today, in the
present saturated world situation, planning and guarantees of
employment are becoming essential for any future progress. But
the nature of the capitalist system of production precludes any
rational planning and, even more, any guarantees of employment,
as we have seen earlier.

There is no long term rational plan of production and use of

resources.

There is no guarantee of security of employment, nor provisions

for alternative occupations when an industry becomes obnoxious,
obsolete or has reached the limits of its growth; for example, to
prevent unemployment in the timber industry we are compelled
to continue cutting our forests until there are no more left.

Every individual, therefore, for the sake of his immediate survival,

must strive to keep alive the industry or organism of which he is a
part. This applies to all organisms within capitalist economy,
whether they are good or destructive. It seems to be evident that
most people who have vested interests in, or whose livelihood
depends on any dangerous or obnoxious industries, are the most
strong apologists, or even violent supporters of such industries.

Another feature of capitalist society, deriving from the lack of

rational planning and guarantees of employment, is the
unconscious perversion of social and personal interests. The
instinctive natural interest of every organism, and every
individual within it, is the perpetuation of the environment that
promotes its growth, and which is the reason for its existence.
Therefore, generally speaking, in a situation when there is little
opportunity for alternative employment, health workers,
preoccupied about the source of their incomes, would have an
involuntary vested interest in the existence of sickness;
policemen would have a vested in the existence of general crime;
people who make a living by working for charity organisations
would have a vested interest in the existence of poverty and
misery; union officials would have vested interest in the existence
of industrial turmoil, and so on.

These instinctive unconscious interests can be very strong

because they are related to the instinct of immediate survival.
Therefore, they can exert a great restraining influence on
otherwise genuine attempts to solve our problems once and for
all.

This general rule and this pressure apply even more when great
gain or great loss of wealth and power are involved. We do not
have to look far to see the evidence of these regressive features
in the present stage of evolution.

Faced with the prospect of losing their employment, as we have

said before, working people in many countries are forced to
accept cuts in wages and living standards.

As we have already seen, a worldwide trade war is going on in

which the workers of different countries are battling to throw each
other out of work. But this absurd battle, by cutting the buying
power of wages, can only further decrease market demand.

The following paragraphs are an 1980’s description of the Hayek –

Friedman Monetary Free Market philosophy that we have seen
lately debunked.

Finally, the most evident sign of regression are the economic and
social policies of our present conservative world leaders. To save
capitalist economy they are attempting to bring about economic
and social conditions that were relevant two centuries ago and
could not possibly improve the present situation.
It seems to be evident that, towards the decline of any obsolete
and corrupt socioeconomic system in our history, we find at the
top leadership either persons who are intelligent but corrupted, or
persons who are honest but not intelligent either intelligent
crooks or honest dunces.

The simple reason is that if a person was honest and intelligent at

the same time, he would have nothing to do with an obsolete and
corrupt system, he would just try to change it and, therefore, he
would not be allowed to reach the top. If such a person would try
to patch up such a system, he would eventually end up either
becoming corrupted himself, or being broken like a fool. This
would only confirm the general rule that he was either corrupted
or a fool, pushed to the top for a brief moment, towards the end
of an Era.

If we look at our capitalist and political leaders today, they seem

to be a sorry sight as far as wisdom goes. They seem to represent
the worst features of the merchant philosophy, plus a narrow
minded perception of the present world problems, and a rock
hard presumption that God is on their side. It is difficult to
imagine a more dangerous combination of attributes in people
who have the power to blow the world apart. But it is their
economic programs that are the most definite signs of regression.

They seem to realise that capitalism has come against some

insuperable problems, and it cannot go much further.

Not knowing what to do, and not wishing to give up, they seem to
have acquired the strange notion that capitalist economy could
continue to expand for ever if they could recreate the conditions
that had been favourable to its birth and early development.

In other words, they have the nostalgic assumption that, if they

cannot go forward and the present is full of troubles, all could be
fine if they could turn the clock backward, to the good old times
when Capitalism seemed to work so well.
They want to revive Capitalism by trying to re impose those
features which they believe were prevalent at the beginning and
during the Industrial Revolution. Their main argument is that
today wages are too high, and that the capitalists are too much
restricted by governments, unions, social and ecological
considerations, etc. Therefore, by eliminating all these
restrictions, capital could be free to expand further and the
capitalist socioeconomic organism could survive.

In short, their aim is to put 'capital above all', and make the need
for profitable capital investment the overriding and overruling
consideration above everything else.

Today, this has become more or less the main economic object of
all the main political parties in the capitalist and also socialist
countries. Whether Liberal or Labour, Republican or Democratic or
even Socialist, their main cure for our national economic and
social problems is to undercut the opposition in the international
world markets. To this effect they urge the workforce to make
capital investment more profitable for the capitalists, that is, to
increase the productivity of labour.

By now we should know what this means, and how hopeless it is

in the saturated world market, where over a hundred countries
are already sacrificing their populations trying to do the same!

These regressive features are real and are not exaggerations.

They are the logical results of keeping artificially alive a system
that is already rotting. It should be evident that Capitalism, from a
progressive force, has become an impediment to any further
Human progress.

The positive features that Capitalism may have had in the past
are now turning into destructive trends.

Capitalism has become a spoiler; as it continues to evolve it

produces continuous changes and technological improvements,
but these changes, instead of becoming beneficial, they turn into
nightmares. For example, years ago some wise people recognised
the impact that technology, overproduction, saturation would
have on society. They advocated some rational solutions like
shortening working hours, lowering the retirement age, paying
more attention to the quality of life.

The capitalists resisted, they derided and belittled such advice:

nothing was done. One of their apologists (Alvin Toffler's Future
Shock) could only suggest that society could only accept and try
to adjust to the rapid changes!

Now technology has overtaken us, and fewer hours are being
worked overall anyway; but, while older people are being flogged
to work until they are 'eighty five percent incapacitated', young
generations are rotting in idleness and despair. Therefore, the
goodies that capitalism produces turn into poison for society.

Adam Smith pointed out two centuries ago, unfortunately to no

avail, that we should beware of the advice of merchants and
manufacturers; he was speaking of monopolists in particular, but
it applies to all capitalists when their vested interests are
threatened:

". . like an overgrown standing army, they have become

formidable to the government, and upon many occasions
intimidate the legislature. The member of parliament who
supports every proposal for strengthening this monopoly, is sure
to acquire not only the reputation of understanding trade, but
great popularity and influence with an order of men whose
number and wealth render them of great importance. If he
opposes them, on the contrary, and still more if he has authority
enough to be able to dwarth them, neither the most
acknowledged probity, nor the highest rank, nor the greatest
public services can protect him from the most infamous abuse
and detraction, from personal insults, nor sometimes from real
danger, arising from the insolent outrage of furious and
disappointed monopolists.."

Today it is done through the Media.

In conclusion, in its terminal stages, Capitalism can be compared

to a dangerous cancerous growth an uncontrolled growth of
living cells which destroys healthy tissues and organs, eventually
killing the body organism in which they have developed.

Greedy cells that grow in an irrational uncontrollable way at the

expense of the rest; Such has become Capitalism, to the letter. It
must keep on growing even when it has reached its natural limits.
Therefore, this growth, instead of being progressive, becomes
unnatural and destructive. When it stops and eventually it starts
to shrink, the immediate livelihood of every individual inside the
organism is at stake. Consequently, motivated by the natural
instinct for immediate survival, every individual will strive to keep
the rotting organism alive, even when it should be obvious that
without a radical change it will cause the degeneration and
destruction of all.

Are not our modern cities come to resemble very accurately a

cancerous growth? They are emitting smelly and sickening fumes,
mountains of rubbish and stinking effluent, like pus, is flowing out
of them, and they hot up in an increasing paroxysm of movement
and activity within the bitumen and concrete crusts of their rising
and sprawling buildings.

Have we Humans become the obnoxious and dangerous viruses

that produce these sores?

Have we Humans become the virus which is destroying this once

beautiful and healthy living cell: our Mother Earth?
 CHAPTER XXVII.

THE SOPHISTRY OF SEPARATION

AND THE INFLUENCE OF THE MEDIA.

********

Capitalist apologists seldom explain the capitalist socioeconomic

organism as a single entity in which all factors and groups are
closely interrelated. They prefer to promote the concept of
entirely separate entities, each one performing a specific task for
the good of the Economy and the Nation, as the 'Economy' and
the 'Nation' were separate abstract ideals.
This philosophy suits the capitalists in their promotion of the
double standard maxim that they need profit and personal gain
not so much for themselves but for the well being of the
'Economy' and the 'Nation', and the workers must produce more
and make sacrifices not for the capitalists but for the 'Economy'
and the 'Nation'.

This way of thinking also makes it possible for them to blame any
particular section of society or of the economy for all the
problems, without having to question the basic faults of the
system as a whole. In fact, what we are being told all the time is
that the capitalists are always willing to do their duty to increase
their profits and personal wealth for the Economy and the Nation,
but it is the selfish workers who make trouble by refusing to do
their duty to make sacrifices for the Economy and the Nation.
(1970s)

We know very well who is blamed in the media most of the time
for our economic problems: the power hungry Unions, the greedy
workers, the 'socialist' Labour party and Government
bureaucracy; businessmen are always the victims.

It is a very effective trick to separate all sections and aspects of

life in the society: the business community, the bureaucracy, the
investors, the taxpayers, the public, the unionists, the family man,
the man in the street etc. as they were completely abstract
concepts unrelated to one another, but each of them being
separately connected to the abstract concepts of 'Economy and
Nation'.

For example, how many times we hear in the media that the
unions have no concern for the good of the community and are
sabotaging the economy. It sounds like union officials have no
relation to the workforce which, with their families, makes up the
greater proportion of the population, and, therefore, are the main
part of the community, the economy and the Nation.
By this logic of separation, a person during his working hours is a
worker and nothing else, when he is on strike or any other union
activity he becomes a unionist, when he commutes he becomes
the traveling public, at home he becomes the family man, when
he is shopping he becomes a consumer and nothing else.

These attributes are true enough, but the way they are used in
the media creates the impression that a unionist, for example,
may not also be a family man, a commuter, a consumer, a
member of the public, etc. all at the same time.

To suggest in the mass media that a person may have all of these
attributes at the same time, would require an explanation on why
such a person would engage in activities that would seem
detrimental to himself as a family man, as a commuter, a
member of the public, etc.

Such explanation may be too complex and difficult, and possibly

too revealing for the capitalists' comfort.

Often we use philosophy to justify our actions. Therefore it suits

the capitalists sometimes to adopt the idealist philosophy of
separation, especially for their propaganda and their book
keeping.

They would not risk using it in their business.

The fact that it is difficult to express ourselves without isolating

the different aspects of a complex situation or concept only shows
our intellectual limitations and the primitive stage of our
languages.

For this reason the capitalist mass media is very effective in

promoting support for Capitalism. Its logic is simple, superficially
convincing, and it does not require much thought from lazy
people or from people with busy lives. It uses elements of truth,
and through superficial deductions it arrives at superficial
assumptions. These, while appearing reasonable and truthful,
have little real substance.

Moreover, as they are simplistic, they are difficult to challenge

because reality is much more complex and, therefore much more
difficult to explain to people who may have no time or inclination
to think deeply and objectively.

So far, such people are the majority in a society. Eventually they

may realise the shallowness of their assumptions when the
realities of life overtake them and become obvious to most. But
then it is usually too late to prevent the destructive consequences
of their mistakes.

A typical example amongst the many in history is what happened

in Germany before the Second World War. There the majority of
the population was made to believe the Nazis' superficial
assumptions.

These suited the people at the time, they were easy to believe,
and they were reassuring. Only when it became too late, people
began to realise their monstrous mistake. Suddenly, those people
who had been persecuted as traitors of the Fatherland became
the heroes of the Resistance. But Germany and the world had
already paid dearly for the promotion of those assumptions.

How much responsibility can be laid on the German capitalists

who financed, and on the middle class and on the media that
helped to promote the Nazi movement? There should be little
doubt that without their help and their passive complicity Nazism
could not have succeeded.

Today, Capitalism is in the same situation in the world as a whole

as it was in Germany before the war. Capitalists are acting exactly
in the same way; they are favouring or actively promoting
extreme conservatism, and if not in words at least in deeds they
are supporting or condoning the most ruthless right wing
dictatorships.

Extreme conservatives during the Cold War were promoting the

philosophy of the first nuclear strike that a nuclear war could be
won by striking the first blow. They also promoted the idea that it
is better to be dead than red, and the mass media has been an
accomplice in this promotion.

Only strong public opinion can prevent ecological and social

calamities, and the influence of the media is vital in its formation.
Therefore, the bosses of the media must bear a lot of
responsibility for the plight of society.

As a recent example, in Australia, during the last twenty years or

so they have relentlessly exhorted the government to embrace
the dry economic philosophy of the "new right": - monetarism,
deregulation, reduction in government spending, tax incentives
for private business, restriction of union activities, etc.. Like
lemmings we have followed the same economic policies that the
U.S. and England had implemented ten years earlier.

We followed Milton Friedman, Reaganomics, Thatcherism even

when the miserable results of their philosophy had already
become evident. Now that we are economically and socially
almost bankrupt, in fact a slave Nation, the eunuchs of the Media,
like the Ross Gittins and others, are acting innocent (1980s); they
pretend that it wasn't them that urged and blackmailed the naive
or the self seeking politicians in government to implement the
interested editorial line of their masters in the media. Now they
are at it again, pontificating about the economy and peddling the
same hopeless line. So obtuse and forgetful is the public!

In a dictatorship the media is controlled by the government, it

must support the ruling political party. This shows how important
is the control over the means of information for any ruling class;
but this rough and simple directness becomes completely
transparent and counter-productive when the ruling elite
becomes corrupted and is lying.

In 'capitalist democracies' the situation is different, much more

complex, and it varies in different countries. The media is part of
free enterprise. Newspapers, magazines, TV, radio, the film
industry, etc., they are an assortment of businesses run for profit.

Regarding their political leanings, it is natural that, as free as they

may be, their allegiance and ultimate interests lay with the
capitalist system. Moreover, the media not only depends
financially from its readers and viewers but also from the
advertising needs of business interests.

Whether it is owned by millionaires or by shareholders, it is

subjected to capitalist conservative considerations.

Moreover, it doesn't make much difference whether the media is

all in the hand of one businessman or it is split between many ;
they all believe in the same philosophy and, on the important
issues, promote the same editorial line. When the media outlets
are owned by different businessmen we are confused into
believing that it is free and democratic! When was the last time
we have seen or heard a strong debate between media outlets
about different or opposing economic or social alternatives? It
would be better if the media was owned by just one entrepreneur;
it would be less confusing and at least we would be clear where
the editorial sermons were coming from.

The public media, like the BBC, ABC, RAI etc that were supposed
to present all facts and points of view - Left, Right and Centre -,
after decades of conservative government interference have
completely dropped the Left part, therefore all we have is either
Centre, Right and extreme Right slanted news and comments
influencing public opinion.
No journalist in the capitalist media is directly forced to follow the
establishment's line, but everybody knows that one cannot go too
far from it without risking his job. Consequently, for self
preservation, they must accept some 'self imposed' limits. These
limits sometimes are stretched very far but, as with capitalist
economists, they must stop short of a deep inquiry into the core
of the economic system, or short of blaming Capitalism directly as
the main cause of our economic and social problems.

If we overlook commercialism, sensationalism and advertising,

which is not easy, the media in capitalist democracies is very
prolific, entertaining and informative; although very much inclined
towards bad news as "bad news are good news" for profits. The
capitalist political line is maintained not by printing direct lies,
which is counterproductive in the long run anyway, but by a
selective and subtle feeding of news and information set to
support the editorial leadership; also by the use of appropriate
words and adjectives to put the news item in a good or bad light
to suit the editorial political line. This manipulation varies in
intensity depending on the importance of the issue at stake.

This subtle slant in the media is not enough to fool an inquiring

mind, but it is enough to sway that fickle twenty percent of the
public that makes up the fifty one percent of the votes. Because
of its subtlety and its indirectness it is more effective than the
direct propaganda of a dictatorship, as it induces most people to
believe that it is their own independent opinions that are reflected
in the media instead of the other way around. Therefore, it is
effective enough in the long term to produce in the majority of
people a sort of vaccination against anything which is contrary to
Capitalism.

The few anti capitalist weekly papers have no impression on the

general public. Very few people would like to be seen buying or
reading such papers, so strong and pervasive is the general
atmosphere of disfavour, even antagonism, towards anything that
may be associated with opposition to the capitalist system. There
is no need to say that this atmosphere has been created over the
years by the capitalist oriented mass media and other forms of
communication and entertainment.

It follows that in practice even in allegedly democratic countries

where there is not a strong and popular progressive movement
with its own media outlets, the objectivity of the information
reaching the public is not much better than in a dictatorship. In
the first because of misinformation, in the second because of
censorship, the public seldom comes into contact with news that
are opposed to the ruling trend. The public is never presented
with objective reality, and so, helplessly and tragically, masses of
Human beings who have no interest or reasons to be against each
other, succumb to suspicion and hate and are set to destroy one
another.

Another example of the power and bias of the capitalist media

can be seen in the continuous shift to the right in the political
scene.

With its subtle relentless pressure the media can influence a

section of the public and, with the passing of time, it can
condition to a certain degree most of the rest, eventually even
the more intelligent and inquiring people.

When there are two political parties, the conservatives by

reflection are reinforced in their beliefs as public opinion is turned
more and more 'antisocialist'. The more progressive Labour party,
chasing votes and having little influence over the media, is forced
to compromise and forego its ideals to gain some support from
the capitalist press, and votes from the public. Its professional
politicians, therefore, prostitute themselves and betray the people
who elected them by making deals with self seeking media
bosses and entrepreneurs.
So, gradually over the years, a proud party which started with a
socialist platform becomes apologetic about its own name, let
alone the word 'socialism '.

The tragic thing is that the society as a whole has lost the choice
of a distinct alternative. At the elections, the only choice is
between two similar social and economic prospects. For the
superficial person this is democracy, but in practice this is the
disguised dictatorship of the capitalist business class.

Both parties are committed to capitalist economy; but our

economy has been thrown to the wolves of the world's market
and is affected by global factors beyond the control of our
business and political leaders and, moreover, it cannot be
harnessed in its decline. Therefore, no matter which one is in
government it will end up discredited and with the economy and
society still in a mess. The two main political parties have become
the two different sides of the same coin, both trying to harness
the obsolete capitalist economy, and both failing.

Eventually, when both become discredited, and the public

confused and cynical, a third party will emerge with the cast offs
of the other two: Naturally it cannot be a radical party to the left
of the two main parties where it is needed, as the capitalists who
own or influence the media would not tolerate such a movement.
This new party will squeeze itself in the middle, if there is any
space just another safe horse to run for the capitalists.

With this trend, as Labour continually shifts to the right, the

moderate Liberals lose their political platform and are thrown into
confusion. They are left with no other alternative than to join the
ultra conservatives while the Labour party is under constant
threat of disintegration.

These three parties, all capitalist oriented, will engage into a

three cornered electoral minuet for a number of years, while
society continues to slide into deeper troubles, accompanied by
the orchestra of the capitalist media blaming everything and
everybody else but the main real cause of our present problems
Capitalism itself.

It is tragic to see how the United Kingdom, the United States and
other supposedly democratic countries are in this respect no
better than the one party 'banana republics', nor better than what
was the Soviet Union. The people of these countries have no real
choice; they have no alternatives to Capitalism. All their political
parties have become almost the same: they are different only in
form but not in substance.

They are all subjected to the same capitalist economic forces, to

obsolescence and degeneration.

CHAPTER XXVIII.

ABOUT SUPERFICIAL ASSUMPTIONS.

********

It should be obvious, in this terminal stage of capitalist evolution

that what began about two hundred years ago in England as the
Industrial Revolution has become today an Industrial Explosion
encompassing the whole planet Earth.
In this world-wide competitive scramble to develop at all costs,
the only consideration is short or medium term profit.

In the competition to win the trade war, any cost or long term
investment in social well being and ecological considerations is
being evaded.

The possible destructive results of the reckless use of science and

technology in the hand of desperate merchants cannot be
foreseen. The merchant class is the least class of society that
should be in charge of the destiny of this planet in the present
situation; yet, after the failure of the first socialist attempt to
create a more Humane and rational socio-economic organism,
they are completely in charge.

Never before they had such power: now they dominate the United
Nations and they command the military power of the West under
NATO; this power they have already collectively used in the
destruction of the Yugoslav Federation, the Gulf Wars and now
the forever War on Terror . But more powerful of all their armies is
their control over most of the Media because it is through the
Media that they are able to convince and steer the rest of the
society to accept the philosophy and vested interest of their class
as the law of the land.

Why would Mr. Murdoch, the "stinker" of the capitalist media, go

to Eastern Europe soon after the collapse of the socialist
dictatorships to buy into the media outlets of those countries?

The Merchants, this small class in our society, have proclaimed

themselves to be the defenders of freedom and democracy: these
are the same people who believe in the philosophy of selfishness.

As it was said before, strong public opinion seems to be the only

force that could prevent extreme conservatism from risking the
complete degeneration of society and of the environment, but
public opinion is very much influenced by conservative capitalists.
It seems to be evident that most people have come to believe
without question the capitalist assumptions disseminated through
all the means of information and entertainment.

The subtle and pervasive spreading of half truths, biased opinions

and superficial concepts has created an atmosphere of suspicion
and hate towards anything that may threaten the capitalist
system. Opponents of capitalism are being de humanised or
made fun of; they are painted either as "evil creatures" or as
"bleeding hearts", "trendies", "lefties" etc.

In general terms, the main trust of capitalist propaganda rests on

one main assumption that Capitalism is good for progress, and
that every other alternative is either evil or impracticable; that
there is no alternative to Capitalism as the only system which
promotes 'freedom and democracy'. On this assumption many
people are even prepared to persecute those who disagree.

Therefore, we should try to examine the objectivity of these

assumptions and see if they warrant the risk of social and
ecological disintegration.

First of all, the capitalists maintain that we have no other

alternatives available other than Capitalism or Socialism as it has
evolved so far; therefore, even when admitting that Capitalism
has some faults, they point out that the alternative is much
worse. Consequently, we must bear with Capitalism whether we
like it or not, the only thing that we can do is to try to improve it.

Most people are satisfied with this assumption, and they do not
even think that Socialism could have succeeded in a different
environment than the one where it started, or that other
alternatives can be found.

This is a negative attitude. But capitalists do not think like this in

the course of their business, they are always willing to try new
methods and schemes to make profits.
They only choose to promote this negative attitude in the public
to protect their interests when Capitalism is being questioned.

We must remember that the capitalists, or any ruling

establishment for that matter, always have and always will
discourage and obstruct the development of any viable
alternative to their own economic system. They have all the
interest and the power to do so. Moreover, why are they so
worried about Socialism if they are really convinced that it is so
inefficient and it has no future? Why did they go to such extremes
to prevent its birth and sabotage its development?

Should we accept the superficial capitalist assumption that there

cannot be alternatives to Capitalism, and deny ourselves the
opportunity to find one?

Another point which is promoted very successfully is that

Capitalism is 'Democracy”. But our type of democracy is more an
illusion than a fact, and it is not by any means a feature of all
capitalist countries. In fact it is more the exception than the rule.

There have been several kinds of societies in history that had

some elements of democracy, and the primitive communal
societies, where private property did not exist, were probably the
most democratic of all. There is a close relationship between
property and power. Communities where property was evenly
subdivided amongst the citizens were fairly democratic, but as
soon as property accumulated in a few hands democracy
disappeared.

Complete democracy has seldom been allowed to develop in the

world. Even in ancient Greece, the 'cradle of our democracy',
democratic rights were only the privilege of a few thousands
citizens property owners, and the Greek socioeconomic organism
rested on the work of many thousands of artisans and slaves.
Our present kind of democracy was born in the Medieval
Communes and City States. It was the democracy of the early
merchant traders and artisans; it evolved with Capitalism, and it
is suited to the system it is the democracy of the merchants, in
which their class by their capitalist Constitutions have all the
advantages over the rest. But, as it evolved with Capitalism, now
it is degenerating with it.

Real democracy presupposes a general level of education

oriented at promoting rational independent thinking, a complete
freedom of information, and a system of elections which does not
favour wealth or deception. Can we honestly say that our
democracy conforms with these requisites?

Our democracy is allowed to exist as long as the capitalist class

has the advantage, can command fifty one percent of the votes,
has the power to make it difficult for any party that threatens
their interests, or as long as all the main parties are capitalist
oriented. But as soon as there is a real threat to their power, they
change the rules of their democratic game. They will support any
dictatorship, even the most oppressive, as long as it is in favour of
Capitalism.

It was capitalist interests that helped the establishment of fascist

regimes in Italy, Germany, Spain and China after the first world
war; after the Second World war it was Turkey, San Domingo, Viet
Nam, Argentina, Greece, Brazil, Chile, Salvador, Nicaragua and
other Asian, African and South American countries where behind
the 'gorillas' of the army juntas was the shadow of property
owners, bankers, businessmen and corporations.

The capitalist media likes to publicise and exaggerate the degree

of oppression and repression perpetrated by communist regimes,
but they completely avoid mentioning the oppression and
repression perpetrated in defence of mercantile capitalist
establishments not for humanistic ideals but for selfish personal
greed. Without mentioning the exterminations, cruelties,
robberies during the centuries of mercantile colonial expansion,
just read William Blum's documented story of capitalist repression
during half of the last century.

Socialist countries may not have had our kind of democracy, but
they certainly did not have the monopoly of repression in the
world.

Therefore, it may not be in the nature of Capitalism to be

democratic, and in the nature of Socialism to be undemocratic,
but rather it may be the result of many variable factors and many
different historical circumstances.

One of the main factors may be that any ruling class can afford to
be democratic when it feels safe, and it becomes undemocratic
when it feels threatened.

Therefore, different forms of democracy are allowed to develop

and exist within different organisms as long as they do not
threaten the established order.

There are different determining features in the nature of different

organisms. But, at least in theory, an economy based on the
common ownership of the means of production should be more
conductive towards a democratic society than a system where, in
the words of Karl Marx, "the necessary condition for the existence
of the private property of a minority is the nonexistence of any
property for the immense majority of the society".

The main problem with the planned economies of the socialist

countries was that, because of their original backwardness, their
revolutionary beginning, and the continuous opposition from
within and outside, they were forced by necessity to concentrate
all economic power in the hands of a central government. The
constant threat and ostracism from outside promoted in these
countries a sort of siege mentality, which in turn favoured the
establishment of a tough leadership rather than a moderate one,
and forced them to dissipate a great amount of their resources on
armaments instead of peaceful projects; Therefore the
development of entrenched elites and corrupt bureaucracies. But,
as the causes for the development of such obnoxious faults will
gradually tend to diminish, there should be a trend towards
decentralisation and more democratic participation. If we look at
the evolution of the Socialist countries over the thirty years
before their collapse, we can see that this trend was quite strong,
as in Hungary and in Czechoslovakia: "Socialism with a Human
face". Had the Soviet Union let that trend to flourish, it could have
been a great boost for Socialism throughout the world. But the
Cold War was still raging and that aspiration was squashed; this
was probably the beginning of the end.

By the time some of the leaders decided to democratise the

system it was too late.

By then the Communist party and the bureaucratic establishment,

as in any dictatorship, had ossified into a corrupt amoral ruling
class. This caused the majority of the people to become cynical
about those ideals for which in the beginning they would have
made any sacrifice; people had become as selfish as their
leaders, they also became despondent and lazy as they did not
have incentives to work, nor the fear of unemployment, as we
have in capitalist society, to goad them to work.

We should not forget that capitalist countries, even more, have

their entrenched elites and corrupt bureaucracies. Should we
believe without a deep scrutiny the superficial capitalist
assumption that they have the monopoly of democracy?

Capitalist apologists like to claim that Capitalism is freedom. This

is quite true for those who believe in Capitalism, no matter how
poor and restricted they may be. But to claim that Capitalism is
freedom for all is a completely false assumption, which,
unfortunately, many people have been conditioned to believe.

What is freedom? In real life, as far as we know, the abstract

concept of absolute freedom does not exist and this word is being
abused very much. One of the main restrictions on the absolute
freedom of each individual is the freedom of the others, and often
the freedom of one is the slavery of many.

Freedom must be defined and specified in relation to objective

actions or subjective feelings: freedom to do or not to do, to feel
free or not. Freedom can be a state of mind, a question of choice,
a question of faith or belief. Sometimes what is freedom for one
person can be oppression for another, depending on their
attitudes and inclinations. How can we explain that in many
struggles and wars in our history just as many people died on one
side as on the other, both fighting for their freedom?

People think of liberty in relation to themselves and what they like

or do not like to do, in relation to their own subjective values and
attitudes, but most of all in relation to whether they are allowed
to live or not. Life is Life, even in different societies: there may be
different environments and different sets of rules, but in the end
all peoples are Human beings, they must live, work, love, raise
children, laugh, cry, and finally die.

In capitalist society, the amount of freedom of action and

movement of every individual person depends a lot on the
amount of property and money one owns, and on how good a job
one has within the economy or the government. This applies more
or less in all modern industrial societies, even if the rules and
conditions may be different.

In every society there are people who are ambitious and want to
lead, and people who are happy to go along and follow, as long as
they are allowed to live a decent life, and their children are not
denied the opportunity for a better future.
There are two main freedoms that people are struggling for in the
world today: one is the freedom of the merchant to exploit, the
other is the freedom of Humanity from being exploited.

By the philosophy of the merchant, only if one has something to

sell one has the right to survive, and only if one has the capital or
the money to buy them, one has the right to use the natural
resources of this planet. Therefore, at present there is a clash of
interest worldwide between capital and Man; between the law of
the merchant and the money lender on one side, and the law of
Nature on the other.

In this struggle there is no question of nationality, race or culture.

These, for international capital are only ploys and disguises. There
is a contest for 'freedom' between Capital and Mankind.

Amongst the allies in the capitalist camp we find some of the

most intolerant right wing associations and religious bigots,
including the Klux Kluk Klan, we find organised crime, secret
service organisations that have become a law in themselves, and
also we find every one of the capitalist dictatorships around the
world regardless of colour, creed or nationality. Only a superficial
and naive person could sincerely believe that it is everybody's
freedom that these groups worry about, especially if we consider
that most of these people believe in the philosophy of selfishness.
Why did the United States always intervene directly or indirectly
in favour of capitalist interests against societies trying to lift
themselves from poverty and oppression?

Which was in reality Mr. Reagan's "Evil Empire"?

The freedoms that Humanity should strive for are the freedom
from unemployment and poverty, insecurity, ignorance, pollution,
and, above all, war.
Should we believe without a deep scrutiny the superficial
capitalist assumption that they have the monopoly of freedom for
the whole of the Human race?

The business establishment, their entourages and their capitalist

economist always expound the doctrine that governments should
not meddle in the management of the economy and the society.
They state that everything should be left to private enterprise;
that capitalist entrepreneurs, with profit in mind and competing
with each other, can provide cheaper and better services to the
public than the government can. Therefore, most government
functions should be performed by private business for profit, only
what is not profitable to them, like for example providing for the
poor, should be left to the government or to charity. They hate to
see the government spending public money on anything that has
not the purpose of helping or promoting their vested interests.
They hate the government bureaucracy that is not at their
service, or is there to regulate them and to protect the public. Yet,
they have their own bureaucracy, bigger than the government;
what is the proliferation of banking, insurance, advertising, civil
law, etc. if not a vast, expensive, non productive bureaucracy of
capitalist business?

In fact, to leave functions that are important for the whole of the
society and should be performed by a government responsible to
the society, to capitalist entrepreneurs and to the law of the
market could be very costly and disastrous.

For example, let's look at the Health Care systems in Canada and
the United States: in Canada there is only one Health Insurance
scheme run by the Government, it covers all the population, the
administration cost per each dollar is very low, for example the
cost of paperwork is one cent in the dollar; In the United States
there are 1500 Health Insurance companies and still 30 million
Americans are not covered, the cost of paperwork is 10 cents in
the dollar, the cost of running this private enterprise army is
astronomical as each of the 1500 companies must spend for their
administration, marketing, advertising etc.; moreover, one of
these companies has been charged with fraud and another 35 are
under investigation. Of course all these companies are providing
profits and a lot of non productive work for a lot of people, but
this is little comfort for those who are sick; So much for replacing
government bureaucracy with private enterprise bureaucracy.

Another example of private enterprise efficiency is what

happened in Australia and, to a lesser extent, in other countries
which have adopted the same capitalist philosophy: in 1983 a
Labour government came to power; to keep the Media on side it
became very friendly with big business and started listening to
their advice; after a few months this government dropped most of
their Labour Party policies and principles and started gradually
adopting and implementing the "rationalist economic philosophy"
of their business friends: deregulation of banking and the money
market, privatisation, removal of controls over investment,
cutting of government spending, control on wages but not on
prices.

Since 1983 real wages fell nearly 15 per cent; with the billions of
dollars saved in wages, the billions saved by cuts in government
spending, plus many billions of dollars borrowed from foreign
sources our free enterprise businessmen, instead of investing
long term in building the productive capacity of the country, they
started chasing quick profits playing a game of monopoly in
Australia and around the world. Since the 1987 stock exchange
deflation most of these business captains that had been praised
and admired by our politicians, by the media and, consequently,
by the general public went broke.

In 1983 Australia had a foreign account deficit of about 17 billion;

after only eight years, during which our capitalist free enterprise
businessmen were given a free hand, our foreign account deficit
has reached about 150 billion dollars, moreover, instead of having
something to show for such indebtedness, most of Australia's
manufacturing industry has been dismantled, destroyed after
being thrown to the wolves in the "level playing field" of the world
market; moreover half of the best industries that were left had to
be sold to foreigners: - our entrepreneurs could not service their
debts, other Australian companies did not have the money to buy
them out, therefore they had to sell out to foreign investors. On
top of this, the country is in recession, ten per cent of the work
force is out of work with consequent social degradation.

A country that is not industrially self sufficient, that is half owned

by foreign capital likely to be withdrawn whenever another
country may offer better prospects for profit, that has a foreign
debt of 150 billions, such country is not an independent country,
it is a Nation of servants, a "banana republic" as the Placido
Domingo of the Australian economy liked to say.

All this in the short time of eight years during which our
businessmen were given a free hand; One could not ask for more
efficiency!

I have just pointed out some of the differences between the easy
to believe capitalist assumptions, and a possibly more objective
assessment. The doubts on the accuracy and honesty of these
assumptions should be so strong that any reasonable person
should think very hard before committing himself and his future
generations to the perpetuation of a socio-economic organism
that can only degenerate more and more into hopelessness,
violence and destruction of the environment.

In conclusion, we must never let ourselves be confused by the

assumption that there is no other alternative beside Capitalism or
Socialism as they have developed at present. There is no valid
reason why we should not find alternatives. We must always
remember that the economy must be subject to the needs of a
society, not the other way around.
If an economic system cannot any more serve the needs of the
majority of the population then it must be changed.

Moreover, we should always remember the warning given two

centuries ago by Adam Smith about the claims and advice from
the capitalist class: " .....it comes from an order of men, whose
interest is never exactly the same with that of the publick, who
have generally an interest to deceive and even to oppress the
publick, and who accordingly have, upon many occasions, both
deceived and oppressed it."
 PART III.

A CATALYST MOVEMENT.

CHAPTER XXIX.

A SIMPLE PHILOSOPHY.

********

After reading this discussion so far, some people may agree, if

they were not already convinced, that capitalist economy has
become obsolete and is a danger to our survival. This should be
evident to the majority of reasonable people. But the main
question that must now come to our minds is 'what can we do
about it'.

All over the world, concerned people are joining into different
movements with the purpose to solve our social and ecological
problems. But most of these movements seem to be fighting
windmills, as they are expending all their energies in different
directions against the effects rather than the deep causes of the
present problems. This is certainly better than doing nothing, but
it is not effective enough in the short time that we may have
available.

What is needed, in my opinion, is a catalyst movement with a

catalyst idea based on a simple philosophy that can be easily
understood and accepted by the majority of society. This could
unite most people in an effort to transform capitalist economy.

The following is my contribution to such an idea, this is the main

line of my thoughts.

The Human race is handicapped by its ignorance; ignorance and

presumption have been the main negative features in our history;
Ignorance and Presumption had much more to do in determining
our development than the little knowledge that we had about
ourselves and the Universe.

We became ignorant when we became conscious Human beings.

But this original ignorance was not a sin, nor was it culpable.

We fail ourselves only when we do not do our best to acquire

knowledge, and when we, in our ignorance, become
presumptuous, especially when we risk destruction because of
doubtful assumptions.

Different Cultures have developed in different parts of the world,

separate from one another, unknown to each others. Therefore,
we have acquired different attitudes, languages, customs and
religions. These differences have been mainly determined by
distance, by geographical and climatic environments, besides
many other factors.

No Human being on this Earth, as far as we know, has had

anything to do about the choice of his parents and about the
place and environment in which he was born. Therefore,
excessive pride and prejudice about race and nationality are signs
of ignorance and presumption.

Only yesterday, because of isolation and ignorance, the races and

Nations of the world hardly knew each others.

Today, by the development of Capitalism, communication

technology, transport, etc. we have been brought face to face
while our minds are still obscured by ignorance and presumption.
We cannot avoid each other even if we wanted to; there are no
empty spaces left, and for the first time we are forced to solve the
problem of coexistence on this Earth once and for all.

Different Nations and Cultures torn by fear and suspicion,

crowded on a small planet a little speck in the Universe.
We need time to learn about one another. But because of nuclear
and ecological dangers time and space are running out.

There is no doubt that we have much to learn from one another.

In different ways we all have something of value to offer. If we are
willing and have an open mind, we could strive together towards
a better society, a society with many forms and beautiful
varieties.

Outwardly we may be different, but deep down we share the most

important Human aspirations, and we are bound by the same
basic laws of Nature.

We will not survive if we let ourselves be blinded by our original

ignorance, by our presumptions and prejudices. We cannot
survive if we persist with the philosophy and attitudes of personal
selfishness and antagonism. While we possess the technology of
nuclear destruction, we cannot continue to act like troglodytes.

Thanks to the advent of Capitalism and the development of

technology, we never had in our history a better chance for
'global peace' and `global progress'. There is so much to be done,
and yet we may blow our chances and possibly also destroy
ourselves. If we do, it will only be because of our stupidity, and we
will have proven that the Human race was nothing more than an
obnoxious mutation a virus on the face of the Earth; In the
Universe, the judgment will be that a creature which called itself
"homo sapiens" lived on a small planet for a few thousand years;
this miserable creature would have been outlived by all other
forms of life that it had considered inferior a definite evidence of
its stupidity and presumption.

We need time. We must stop or at least slow down for a while and
learn more about ourselves and our environment, solve our
present problems, decide where we want to go, and then proceed
towards the future.
During the last two centuries, after the slumber of the Middle-
Ages, Capitalism has forced Humanity into a breakneck race
without any real thoughts about consequences, and without a real
purpose. We have left nothing untouched, Man or Nature. We
cannot continue this race for ever.

So far only one third of the world has been fully developed into
"consumer societies" and it is still developing further by draining
resources from the rest. We can already clearly see the damage
that we have done to the planet. Let's think now what would
happen to the environment of this planet if the remaining three
thirds of the world succeeded in their attempts to develop into
consumer societies, as the industrial nations have done; nobody
can deny them the right to do the same as they did.

Just let's try to imagine Asia, Africa, South America all producing
and consuming like Japan or the United States - and yet, this is
what they desperately are trying to do. Neither the developed nor
the underdeveloped countries of the world can stop this race.
Why? Simply because, by the very nature of capitalism,
investment of profits in the production and sales of commodities
must continually expand: Therefore there is no way that
Humanity can solve this quandary within capitalist economy
outside a world-wide fair and ecologically sound planned use of
resources.

So far we cannot fix what we have done wrong within our present
system, let alone plan for the future. We have brought about
destructive trends that may be irreversible. We only start to worry
afterwards, when the ravages of our mistakes are upon us.

Our ignorance is not a sin; we seem to have been destined to

evolve in darkness. But today, even if we are still ignorant, at
least we have begun to open our eyes and see ourselves in
relation to our planet and the Universe.
Moreover if ignorance is not a sin, to close our eyes and our
minds, to refuse to learn, to persist in our mistakes is the worst
disservice to ourselves and the world of Nature of which we are a
part.

When we are in doubt, and this should be most of the time, we

should rather err on the side of safety than on the side of
recklessness.

Why should we be continually pushed on without knowing where

we are going? Our Earth should have a few more millions years of
life if we allow it; therefore, Humanity has plenty of time, there
should be plenty of time for our children.

We need time to sort out our social, economic and ecological

problems on a world scale.

This is the most important point at present.

But Capitalism does not allow us to slow down and think about
the future. It is an uncontrollable force that must expand and
keep on feeding at all costs. When it has reached the physical
natural limits of its expansion, which on this small planet are
becoming more obvious every day, it starts to feed on itself , it
tends to destroy in order to start again and keep on going. We
cannot allow this to continue because our survival is at stake, and
there cannot be compromise on this point.

Capitalism, during the last few centuries, has brought us very far.
But, as we have discussed earlier in this booklet and we can see
every day, it cannot progress naturally any more. It has become
an impediment and also a great danger to Humanity. It must be
discarded; this is not a question of philosophy, religion or politics,
it is a question of natural common sense.

As we have said before, Human beings of different Races,

Cultures and Religions are finally facing one another, and there is
no more space to try to avoid contact. We are still influenced by
suspicion, prejudice and hatred, the products of our ignorance.
Now we must make the choice either to survive together or to
perish together.

The first thing that we must do is an act of humility: an admission

of our ignorance about each other and about our environment.
Then we must find a common ground by concentrating our
attention on the basic essential aspirations and the natural laws
which unite us as a part of the Human Race. We must, for the
present, stop arguing about those differences that have
developed because of our separate developments.

These differences in Cultures, Religions, attitudes, as important as

they may be, are not insurmountable. Often they are the product
of conjecture, of dreams and assumptions. Today they should be
losing importance in relation to the dangers that we are facing.

What is common to every Human being within any Culture,

Religion and environment is the natural instinct to survive, to
improve his life and the prospects for his future generations.
Every philosophy originates from this simple starting point, and
develops according to the requirements of the different factors
and necessities of the different environments, and also according
to the level of understanding about ourselves and the natural
forces which surround us.

Therefore, we should go back to the basic features which unite

Mankind. We could argue but we cannot fight about the rest of
our beliefs. We are still ignorant and, therefore, each of us could
be right or each of us could be wrong. The truth about our
existence and the Universe may become clearer in the distant
future, if we grow in understanding and wisdom. This is a
continuous process that may take innumerable generations.

Every generation is a link in this process of evolution. We have

the duty to promote the continuation of this process, and when
Humanity will have found the truth about the Universe and the
reason for its existence, we will be there.

This is why, in my opinion, the continuation of wholesome life on

increasingly superior levels of understanding is the prime task
and duty of every Human being. Therefore, it should be obvious
that anything that promotes the continuation of Human life should
be encouraged, anything that threatens it should be prevented.

The problem is that, because of our ignorance, we may not be

able to judge what in the long term may be right or wrong.
Therefore, it is important that we are careful and that we take
time in our decisions.

In our progress we must leave ourselves a way open for retreat

and, unless it is inevitable, we should avoid promoting changes
which may be irreversible.

As we have said, the first basic aspiration of every Human being

is to be able to live a meaningful life in the present, and in the
future through the survival of the following generations.

In general terms, the 'Golden Rule' is the primordial natural law

by which Humanity has tried to ensure its survival. 'Do not do to
others what you do not want to be done to yourself': This is
enshrined, directly or indirectly, since ancient times in every
philosophy and religion. It was a form of natural insurance against
the excesses of violence and destruction. Even if it has not
stopped murders and wars, it has acted as a brake against the
worst Human instincts; whoever has transgressed this law has
been disapproved by the majority of Human beings.

The ancient rule of 'an eye for an eye, a tooth for a tooth' was the
Golden Rule in reverse: 'if you do to others what you do not want
done to yourself, then it shall be done to you'.
The Golden Rule is an ancient natural law. Christianity brought
this law a step further: 'it is not enough to abstain from doing
wrong to others, one should love one's fellow Human beings'.

Most Human philosophies and religions since ancient times have

professed a strong faith in goodness and justice, and Mankind, no
matter how bad things may have been at times, has always
admired honesty and virtue. Therefore, it is evident that Man has
always aspired to be good, notwithstanding all his faults.

But at present, most people have been conditioned to believe that

Human nature is basically bad and selfish. This is one of the main
arguments in the armoury of the capitalist apologist. When all his
arguments in favour of Capitalism have been defeated, he likes to
assert that Man is selfish by nature and, therefore, no system
based on cooperation and good will is possible. This is a general
human attitude to think that everybody is like one self; by the
merchants' logic, only Capitalism can work because it is based on
selfishness, but blind selfishness is the root of malice.

The promotion of this doctrine is malicious and dangerous

because it conditions people to accept as normal the worst
features of Human nature. It also creates the absurd situation in
which everybody believes that he is good but that everybody else
is bad. Consequently, everybody becomes distrustful and cynical
and gradually begins to act against his better instincts: people
reciprocally reinforce the negative side of their nature, while the
best side is gradually suppressed. Honesty and virtue are derided,
in capitalist society they become the handicaps of the "suckers".

In fact, man is neither bad nor good. Man is motivated by the

natural instinct of self preservation, and the pressures of
immediate necessity are stronger than the considerations for the
future. Given a chance, Man will rather be good than bad, but he
will do whatever he thinks is necessary for his immediate survival;
at times he will kill, at times he will cooperate with other Human
beings, whatever he may think will promote his survival.
Necessity will mainly influence his behaviour, but his subjective
perception of his necessity is determined by his level of
understanding, which so far has been mainly his level of
ignorance.

Since Man has acquired his imperfect consciousness he gradually

has lost his instinctive innocence, and his instinct for survival has
been affected by his imperfect perception of himself and his
natural environment. Therefore, his instinct has developed in
different, often negative and twisted forms.

The fear of scarcity and famine in a harsh environment has

promoted the features of 'greed and covetousness', and the
mutual fear of strangers and the fear of the unknown have
promoted the suspicious and aggressive features in Human
nature.

But this is only one side of Human nature that the capitalist like to
publicise so much. There is a better side, and this is the more
prominent in the majority of the Human Race: there is love, self
sacrifice for loved ones and for ideals, good humour, compassion,
etc.

There is more joy in being loved than being hated.

There is more fun in loving than hating.

There is more satisfaction in being useful than being useless.

There is more harmony in singing together than screaming at

each other. . . .

Actually, if we consider our struggle for survival in a primitive

environment with the heavy handicap of our original ignorance,
fear, prejudices, it is evident that the better side of our nature has
so far managed to surface and eventually take over most of the
time.
For every bad person in our history there have been a thousand
good ones, for every bad deed there have been a thousand acts
of love and compassion.

Man wants to be good, but he is not allowed because of his

ignorance and fears. So far, in all his attempts, he has not been
able to create a social and economic environment that will fulfil
his aspiration.

That Man has never given up trying is enough evidence of his

good intentions.

Capitalism, in its present stage of obsolescence, is aggravating a

negative environment that accentuates the worst features of
Human nature: to be good natured is not profitable in capitalist
society. Even as I think and write about these ideas, I can feel the
scorn and derision that most people today would show for such
feelings.

But it seems to me that if a person is not allowed to be good he

cannot be completely at peace with himself.

Christ's 'love your neighbour as you love yourself' could mean in

fact that one cannot love himself unless he loves Humanity and
Nature.

What Christianity preaches is almost impossible for many;

therefore the “Golden Rule” should be paramount: it does not
require Love, but at least it requires Justice.

If we can avoid a complete breakdown of what is good in Human

society, in time, with more knowledge and wisdom, we can be
confident that we will be able to build a better social and
economic environment that may promote the best side of our
nature. We must never give up trying.

To sum up in a few words:

Human societies have developed separately from one another,
therefore they have assumed different forms and evolved into
different Cultures; But their basic necessities and aspirations are
the same. Now we have been forced face to face. We need time
to learn about ourselves and about our environment. Capitalism is
rushing us, it does not allow us to slow down and think, it has
become regressive and dangerous. Therefore, it must be
replaced.

All Human beings of any nationality, religion and race, to be able

to cooperate, must concentrate on the basic features and
aspirations that unite the Human Race. We must learn about one
another and find the reasons for our outward differences. From
this starting point we could begin to build for the future, with an
uncompromising unity of basic principles and essential directions,
but also with an immense variety of experimentation and outward
forms.

Admission of our ignorance,

Humility before Nature and the Universe,

Open mindedness,

A continuous effort to seek knowledge and wisdom,

Good will to cooperate towards Human survival at increasingly

higher levels,

These, in my opinion, are the simple requisites for a new

beginning. These are the main attributes of 'people of good will'.

It seems to be obvious that there will always be a need for

merchants in our society, as they perform the task of facilitating
the exchange of goods and commodities in our complex industrial
socioeconomic organism; they should have their say, the same as
all other groups in the society, but they should not be allowed the
power to subject all considerations for Human development to the
particular vested interests of their class.

CHAPTER XXX.

THE PRESENT SITUATION IN

RELATION TO ECONOMIC AND SOCIAL CHANGE.

********

After the financial meltdown, Capitalism is on the ropes and like

during the Great Depression the opportunity exists to finish it off
and start a new Era of real progress; unfortunately there is
nobody to take on the challenge. There is no sign of a well
organised radical opposition; the progressive Left is in complete
disarray: the virtual capitalist dictatorship is in full control and
armed to the teeth (NATO), they will try to patch up their
economy for the benefit of their establishment no matter how
much the cost will be to the rest of the population and to the
Planet.
The leaders that believed and or adopted the economic
philosophy that brought about the collapse of capitalist financial
bureaucracy are still in charge and they will try to save Capitalism
at all costs; how? By promoting more development and more
consumerism in the capitalist Global Market, the main factors that
have brought the Earth to Ecological Meltdown; to save their skins
comes first, Global Warming comes second.

They are still dreaming about the capitalist Global Market but as
politicians they will be forced, directly or indirectly, to bring the
factories back to their voters if they do not want revolution in
their own Countries; therefore more isolation, more nationalism,
more racism and a new more stupid and more deadly trade war to
throw each other out of work.

Where is the Progressive Left? They have given up completely on

the Socialist Ideals; they have been blinded by the temporary
success of capitalist economy and by the failure of the Soviet
Union, a first attempt under extremely unfavourable
circumstances to create an alternative to the capitalist system.

Where is the Left now? They all have become consumers in a

consumer society, most have become part of the middle class,
“chardonnay” socialists, corrupt centre-left politicians, yuppies
have become yuppies, the few small Left political parties have
been infiltrated by secret security agents that are “facilitating”
the small groups to be ineffectual or by agents provocateurs
intent to ruin the movements’ reputation in the eyes of the public.

I have explained my opinion that the transformation of the

capitalist system into a rationally planned or guided economy is
essential for the solution of our present social problems. But a
society and its economy cannot be separated, they are one entity.
Therefore, economic change means also social change.

This raises the question about what would be the essence and the
form of a new socioeconomic organism.
A new economy, to be of general benefit, cannot be artificially
devised and imposed on people. It must be the result of natural
forces, of necessity and natural evolution; at present, necessity
has become the main motivation. The majority of society must
feel and understand the necessity for change, it must also agree
on the new general direction it should take.

The desire for change will generate from a situation that is

becoming intolerable and irrational; the direction will be shown by
the movement that will be able to put in practice its philosophy
and demonstrate to the people the benefits that it brings to those
who embrace it. People will not change unless they can see a
better alternative that is working; people will not jump in a
vacuum or in the dark, unless for them life has become no better
than death.

Therefore, only a new socioeconomic system for which the basis

and embryo already exists within the old society, and has the
strength to overcome all the injustice and violence that the old
establishment will throw at it, will have the chance to grow and
prevail. Moreover, it must be an improvement on the old
organism for the greater number of people, it must offer spiritual
as well as material advantages, and it must offer a better
guarantee for the healthy survival of Humanity.

In the present chapter we should consider briefly the main

objective features in the present situation. Then, in the following
chapters I will try to explain in general terms my opinion on what
kind of society and economy could be promoted in relation to
these features, and also on some ways by which such
transformation could be brought about.

To have an idea of the present situation in relation to economic

and social transformation we should consider three main points:
the desire and the movement for change, the potential of the
productive forces, and the general political situation in the world.
The Human Race has been affected by continual change. During
the last two centuries capitalism has accelerated the pace of our
evolution, unfortunately more in respect to science and
technology than in respect to our wisdom. Today, the desire for
renewal is evident throughout the world, but it manifests itself in
many different and opposite forms in many parts of the Earth.

In the western capitalist countries most people realise that there

is need for change, but there is no unity of ideas nor everyone is
prepared to go to the same extent to promote it.

The traditional division between social classes in relation to

evolution or revolution are not any more the same as in the past.

People who are involved in progressive movements come from

every section of society. Increasingly they come from the middle
class which, at the same time, is materially affluent in capitalist
society: most have lost their integrity, they are not likely to start
rocking the capitalist boat.

With the advent of modern technology, the workforce employed

in production has gradually diminished in relation to that
employed in the service industries.

Most of the lower class of manual workers have no deep

consciousness of the important issues which affect the future;
they are mainly concerned with their immediate survival which
depends from the preservation of the industries in which they are
employed, no matter whether they are good or bad.

In our consumer society, families with more than one income,

workers who receive high wages, and those who are self
employed often are more conservative than the capitalists
themselves, because they can enjoy a high standard of living.

Because of poor education and the influence of the media,

conservatism has become the trend even amongst some of the
poorest sections of society, the unemployed and alienated. Those
who are better off may look with sympathy at those who are poor,
but their sympathy will gradually turn to suspicion and
resentment when the poor become restless, a drain on their
incomes and a threat to their jobs.

Most of the Trade Unions have lost their former anti capitalist
radicalism. Their leaders have become an accepted part of the
establishment, intent to perpetuate their position of power, and
contented to maintain, if they cannot improve, the conditions of
their members within the framework and the requirements of the
capitalist system.

In the final analysis, not withstanding this capitalist victory, the

competition in the world market will intensify, with more poor
countries undercutting each other; desperate to attract foreign
investment to develop their industries, to increase production to
be able to pay their debts.

The situation has definitely changed since the Financial Meltdown

in 2008; the faults and the destructive nature of Capitalism in its
final stage of evolution are clearly evident to anybody with a bit of
honesty and common sense.

It is my opinion that the technology of production in the industrial

countries, and also in some of the developing countries, has
reached a level that, if used in a rational way, could eliminate
poverty throughout the world. But at present, because of the
nature of the capitalist system, this great potential is being
wasted mainly in a senseless economic war for the benefit of a
minority of people that already have too much.

The main economic problem in capitalist society is the problem of

overproduction in relation to the effectual demand, and
Capitalism cannot deal with it in a rational way.
Under the present system, because of competition and insecurity
people who are caught in the rat race of the capitalist spiral of
production are compelled to produce faster and faster; if in a new
more rational and humane socio-economic environment the
factors of competition and insecurity are removed, people may
become more relaxed and they may slow down. But this may not
be a bad change for the majority of Human beings.

This slowing down would be more than compensated by

The rationalisation of direction and purpose;

By the rationalisation of production to eliminate excessive

duplication of products and spare parts;

By the elimination of "planned obsolescence" and the lengthening

of the life of the products by adopting forms of 'modular
production';

By the elimination of obnoxious products;

By the utilisation of all labour potential that today is being wasted

in forced idleness;

By the utilisation of science and technology not for the

destruction but for the conservation of energy and resources;

By the utilisation of clean natural energy;

By the elimination of the arms race and arms production;

By a new feeling of purpose and participation that could release

the power of thought and inventiveness in most Human beings;

By reducing the main causes of hopelessness and conflict, it

would also diminish the expense in crime repression;

Moreover, by slowing down the present rat race, the generations

would be allowed to re establish their natural links, and this would
also allow those people who are slower, to catch up and to
participate in the life of the new society.

Unlike the situation in Russia and China before their revolutions,

the material basis for the development of a planned or guided
economy in most parts of the World already exists. The change
from private ownership of the corporations to public ownership
and the change of orientation of social production from
consumerism and private profit to conservation and social profit
could be possible without much inconvenience to the great
majority of Human beings.

Most likely a rationally planned economy would rather require a

slowing down of production rather than a desperate increase in
sacrifices for rapid industrialisation like in the ex Soviet union and
China.

Moreover, the increasing number of people who are out of work

and are alienated from the present society may be quite prepared
for such a change, they have nothing to lose. Even in the
developed countries now life has become unstable for the
majority of the population; there is no security of work or housing.
How can one rise a family on quick sands; more and more people
seems to be on edge.

These people are a threat to the capitalist establishment. Our

ruling elites are well aware of the danger, they will try to avoid a
situation in which a great number of the population may become
restless; they will keep the majority of the poor in a state of
stupor, just above the level of desperation, with lotteries and
sport, as the Roman populace was kept with distributions of
wheat and games in the Circus.

At the same time, the capitalist establishment will have to build

more jails, increase their security forces, and train the police and
the army for anti-riot and anti-terrorist duties. That section of the
population that is better off will not oppose effectively the gradual
institution of repressive laws and regulations, allegedly for the
protection of the minority in the society. The capitalist system,
therefore, will gradually become more repressive as well as more
regressive.

For these reasons, it seems evident that it is essential to find new

means to promote and accelerate our economic transformation.

To conclude, I believe that the need for change has never been so
strong, and that the material requisites for the success of a new
economy and society are now available. What is needed is the
belief that it is possible and the will to begin working to achieve it.
 CHAPTER XXXI.

A NEW SOCIETY.

********

We cannot deal here with all the details of a new society. These
are the concern of every individual person or group of people,
They will have to decide for themselves what these details will be.
These depend on many factors which are pertinent to different
situations, environment, Cultures, etc. that have evolved in
different parts of the world.

I do not have in mind a monolithic and regimented society. This

would not be possible nor, in my opinion, desirable.

Here we will try to deal with the general basic principles that can
be accepted by the majority of Human beings because these
principles are obvious, and because they have been the
underlying aspiration of Humanity for a very long time.

These simple principles could form the guiding line for a new
world wide and multiform society. While the practical details are
the concern of every individual and of every different group of
people, and, therefore, they may assume many different forms,
there should be no compromise on the few simple but essential
guiding principles.

The starting point is the present situation of Human relations and

understanding, the situation of the productive forces, and the
general aspirations of most Human beings.

From this point we should try to see which principles could be

practical and could be accepted by the majority of people.
We should keep in mind that, at this stage in our history, we do
not have much choice or time to argue about sophisms and
secondary issues.

It is evident that we must adopt a new way of thinking and a new

way of living if we want to improve our chances of survival.

We must remember that Human beings have not always thought

in the same way. Over the centuries, as our perceptions have
changed, we have altered our way of thinking and our attitudes.
With Capitalism we have adopted the mentality of the merchant,
and today it is the mentality of the merchant of the worst kind
the merchant of money. If we want to survive, it is essential that
we endeavour to shed this mentality.

The first prerequisite for a new society should be that we should

drastically reduce the power of the `Merchants and Businessmen'
who now directly and indirectly rule our world and have subjected
our future development to the particular vested interest of their
class and to the uncertainty of their gambles.

Free enterprise should not be eliminated, but it should be allowed

only within a worldwide framework with guidelines and standards
formulated by all sections of the socioeconomic organism.

This plan of production and development should be devised with

the long term Human advancement in mind: Human
considerations should be paramount, science and technology
must have a supporting role. Free enterprise and competition
could be allowed within these limits: the tasks and activities of
production could be tendered out as long as the entrepreneurs
could perform these tasks to the specifications and within the
social conditions laid out; otherwise the tasks would be performed
by the society through Public Utilities.

Private property of the means of production, production for the

personal gain of a minority, and selfish competition are the main
features in capitalist economy. Within this system most people, to
earn a living, must compete against one another to be able to
work for a minority of people who own capital. This form of social
organism is obsolete, today it cannot fulfil the needs and
aspirations of the majority of Human beings, and it is promoting
the worst features of Human nature.

A new economy cannot be based on production for individual

personal profit, destructive consumerism. We cannot allow
exploitation of man by man, and the antagonism of capitalist
unlimited competition.

On our small planet production must be rationally planned for the

need of the whole society in harmony with the environment. We
must produce by cooperating with each other, and priorities
should not be determined by what is profitable to a minority, but
by the real needs of the society.

Farming and food production should be the first priority, then

housing, education and health, and then, in order of importance,
everything that makes life worth living.

We should promote those principles that favour the development

of a most efficient economy based on cooperation, at the service
of, and compatible with, a free multiform and progressive society
an economy serving the liberty of all the people, not just that of
capitalist businessmen.

A new society - Private property.

Time and Value.

Before we proceed further, we should discuss the issue of private

property, the "sacred cow of the capitalist class", the pillar on
which Capitalism rests.
Here we will discuss the private property of the means of
production, not our homes and other personal things that we may
own.

To own the house or the flat in which we live does not make one a
capitalist, we all must live somewhere and, besides, we should
not have to pay through our noses for such a necessity of life:
necessities should not be made objects of personal investment for
personal profit.

We must make an important distinction between the property of

the means of production which affect the whole of society, and
the personal property of those commodities which make
individual life comfortable.

The concept of "absolute individual private property" is particular

mainly to the capitalist system. Capitalism could not exist without
it.

The concept of property, land property in particular, evolved and

changed with the evolution and changes of Human societies; at
the beginning it did not even exist. At the beginning the use of
the land belong to those who could defend it, and in essence it is
the same today.

At the beginning the land was used in common by the primitive

families and tribes. As the population increased and civilisation
evolved, the concept of private property evolved too, but it was
seldom absolute, and it was always ultimately dependent on the
ability to defend it.

The primordial right to anything was the 'Right of Might’: behind

all laws, customs and rights, including the right to property, is the
capacity to enforce them, the willingness to accept them, and
transient common convenience.

In Europe during the Middle Ages there was the land tenure of the
Barbarian Nations; before the development of Capitalism, there
was the feudal form of land tenure entrusted to the nobility by the
King, but everybody had some chartered rights to the use and
produce of the land it was the right to life. Eventually the nobility
took possession and most of the peasants living on their lands
were forced to leave.

With Capitalism, property had to become absolute: there would

be no incentive to accumulate land and wealth if they could
arbitrarily be taken away by force or by decree. Therefore, the
capitalist concept of property had a beginning in our history; it is
not the "eternal concept and the sacred cow" that we have been
made to believe, but it has come about with Capitalism and with
Capitalism it will go. The "absolute private property" of the
capitalist is very expensive to society as a great part of private
and public bureaucracy is continually employed in its
maintenance and protection. In a new society, therefore, we
should distinguish between the main forms of property:

The inalienable ownership of our personal possessions related to

our personal freedom and individuality, the public ownership of
the means of production that affects the whole of society and
The ownership of productive land.

We should consider the property of farming land separately from

the rest of the means of production for two main reasons: one is
that, because it concerns the growing of food produce, it is the
most important issue to be resolved, from which the success or
the failure of any society primarily depends; therefore, it is the
key to a successful and peaceful transition.

The second reason is that it involves special people, those

farmers who grew on the land for generations, love the land and
make it productive.

In the developed industrial societies, the farmers are in a minority

compared with the people that are working in the manufacturing
and service industries, and who are living in the large industrial
cities.

Yet, together with all the other activities associated with farming,
they are the most important people in a society because they are
closer than anybody else to the real source of life without which
the cities, with all their industries could not exist. Their labour on
the land produces the primary fuel for Human life and energy.

If a farmer can grow enough produce to feed and keep alive a

number of families beside his own, he has multiplied his labour
power the source of all wealth.

In figurative terms, of the people who are kept alive by the work
of one farmer, one could become a builder, one a teacher, one a
doctor, etc. This is the basic difference between a simple
subsistence society and one that can grow and flourish.

This is only possible because the land and the work of Man have
produced a surplus of food for the expansion of Human life and
Human activity. It is the task of the society as a whole to promote
the life of useful people, and to discourage the establishment of
parasites.

At present, productive land is owned either by farmers living and

working on it, or by absentee companies, agribusiness
corporations and investors.

In the case of companies, it should not be difficult to change the

nature of the land tenure from private ownership to public
cooperatives. The managers and farm workers on the land, as
long as their livelihood was not threatened and was improved,
would probably prefer to be working for a society of which they
are members, rather than for unknown shareholders and
gamblers in the international stock market.

In the case of farmers working on their own farms, if they love the
land, they should be the ones who husband it. If so they wish,
they and their children should own it as long as they like to make
it productive. To this effect they should be provided with the best
help and facilities, and their status should be commensurate with
their importance to the society. Their value and their
remuneration could be determined by free discussions and
contracts between the farmers, their associations and the rest of
the society.

The main principles about the land are that farming is the most
important industry in a society, that the land should be farmed by
those people who love it and understand it, and that such farmers
should be comfortable and secure for generations, or as long as
they wanted to be productive farmers.

But, in the new society, there should not be absentee landlords,

hoarding or speculation of land and no one should hold more land
that one family or a cooperative of farmers are able to farm.

Regarding the support and recompense for each section of the

society performing a task or function in the economy, there
should be a list of priorities parallel to their importance in the
functioning of the socio-economic organism. For example, if
farming is considered to be first in importance, logically it should
receive first consideration in the overall plan or guide of
production and distribution of commodities, plant and equipment.

“TIME” (kronos - ?) could be made the standard measure

regarding the assessment of the value of labour, the products
created by labour and consequently the cost of production and
entitlements of every individual in the society

Today, with the speed and power of computing, the exact time
taken to produce any commodity from conception through every
stage of production and finally to distribution could be calculated;
Therefore the total value of all production in the society would be
equivalent to the sum of all the time spent in working by each
individual in the society.
The time of one's life is equally precious for each individual
person; therefore everybody would be entitled to a quantity of
commodities whose time to produce is equivalent to the time a
person has spent working. Some consideration should be given
regarding the danger, difficulty and discomfort of some type of
work, also to the ease, pleasantness of other type of work. The
accrued value that a person has not spent should be accounted
as Credit to that person.

A new society - Education.

Considering what we have said so far, it seems to be evident that

in a new society these pitfalls must be avoided if the society has
any hope to remain democratic for a fairly long time.

Therefore, education should be oriented to develop in every

Human being, since school age, the power of independent
inquiring thinking

This is essential for a really democratic society.

Because of the continually increasing volume of information and

knowledge, it has become impossible for any individual person to
master all there is to know. It would be difficult for anyone to
attempt to become a specialist in every field of knowledge.

Education from early age should be oriented, first of all, to

develop the power of objective thinking and social consciousness
through the study of Human history, social sciences, Arts,
Cultures and Religions, and through a general basic knowledge of
all other sciences and technology.

Every person should have the duty and should be encouraged to

reach such level of education. This would promote wider contact
and understanding between people, and should diminish one of
the main causes for the existence of social classes - the difference
in the level of education and culture.
The next role of education should be to provide specialisation,
research and experimentation in every field of knowledge, in co-
operation with the rest of the society and in harmony with its
guiding principles.

Education, as one part of social life, should help to produce

conscious healthy Human beings able to think for themselves.
Next, it should provide the means and facilities for those who
want to specialise in any field of knowledge.

A general principle should be that Humanity comes first, then

technology at its service. For leadership, excellence in both fields
should be the ideal.

It is my opinion that the great majority of Human beings have the

potential to reach a high level of education and Human
awareness. Some are slower than others, some develop sooner
some later, but at the end, within the difference of a few years, all
can reach a high level of understanding.

As it is today, children are already being separated into different

social levels when they enter primary school. Coming from
different backgrounds, compelled by an artificially set timetable
and strict schedule, those who are slow are stunted for life. They
are placed in lower categories and, by the time their intellect
opens up and expands at a later stage, it is too late for them to
catch up. They may already have acquired a sense of inferiority,
and they may have developed mental blockages to protect their
egos. Moreover, unless they come from a wealthy background,
the timetable of their education cannot be extended. This is a
personal tragedy for many young people, and a great loss of
talent for the whole of society.

There should be no stigma or shame in being a slow learner; time

can make up for slowness. In fact, some of the greatest geniuses
were slow students; they succeeded because of exceptional
circumstances or exceptional will power. How many young people
with latent talents have been wasted because their intellect
developed later, and they did not have the fortune of exceptional
will power or favourable circumstances; How many of them are
now intelligent criminals who, in a different society, could have
been good and outstanding citizens?

For all these reasons Schools, Colleges, Universities etc. should be

expanded and be readily available to anyone seeking to improve
their education at any stage of their lives.

A new society the media.

The media and other means of information should complement

the role of education, but they should be completely independent
from any other influence

The reporting of news should be objective, and, for the sake of

objectivity, the proportion of bad news to good news should be in
relation to their proportion in real life and in relation to their
importance.

As we do not know definitely how the Human brain works and is

influenced, we should be very careful about the exaggerated
dissemination of unnatural, putrid and gory news items which dull
our sensitiveness even if for some reason they attract our morbid
curiosity.

Today sensationalism is rampant because it boosts profits, and

what otherwise would be extraordinary and unusual happenings
becomes accepted as commonplace. Much is stored in our brain's
memory banks, in our subconscious, to be activated later on in
some uncontrollable situations.

In the same newspaper, T.V. station, etc. space for editorial

comments and opinions should be allotted to all points of view,
whether they represent the main trend or opposing ones.
A continuous dialogue and even argument about extreme
opinions should go on in the media all the time within the same
paper, T.V., etc. so that it would be difficult for any person to
avoid being informed about all points of view.

The media should be completely independent from the

interference of those in power, those who own it or those with
executive positions in the society, but it should be responsible
and motivated by high Human values.

I cannot say what kind of democratic mechanism should be

devised in relation to the running of the media. It is my opinion
that the media should act as the conscience of society, reflecting
all its doubts and turmoil, investigating and looking in every dark
corner and also should be a watchdog of democratic rights, rather
than an instrument of propaganda for those who are in power.

In the new society, no point of view or new social movement

should be suppressed in the media, as odd or different they may
be from the existing trends. As a guarantee for progress and
change, every new idea must be allowed to be expressed and
debated. If it is good and promising it will gradually gain ground
and develop, if it is no good it will not grow and it would fade
away for lack of support.

A new society democracy.

We call our Western societies democratic societies. We equate

Capitalism with democracy, although some of the most ruthless
dictatorships in the world are capitalist.

Capitalism, it is true, in some countries has freed the mass of the

population from feudal bondage. The capitalists needed a work-
force that was free to move anywhere it was required. They had
to promote the idea of freedom and equality to assert themselves
against the absolute power of the feudal nobility.
But once they had obtained a place in government for themselves
they were satisfied, and certainly they were not keen to make it
easy for the rest of the population, which constituted the majority,
to obtain the same democratic rights as themselves.

Therefore, at first, the right to vote at elections was very limited,

and it took a long and often violent struggle for the workforce,
including women, to obtain the right to vote, to form associations
and Unions. But even the universal right to vote at elections is
just not enough to make a society a really democratic society.
There are many factors which can nullify all democratic principles,
make a mockery of the election process, and frustrate all peaceful
movements for democratic change.

There cannot be a real democracy if the majority of society is not

educated to objective and independent thinking.

There cannot be a real democracy if the means of information and

persuasion are directly controlled or indirectly influenced by the
establishment or by the vested interests of just one class.

There cannot be a real democracy if the elected representatives

are allowed to become an entrenched profession.

There cannot be a real democracy if the executive branches of

government, the law, the police, etc. are directly controlled or
indirectly influenced by the establishment, and have become
themselves a social class with a vested interest in conservatism.

All these undemocratic features are, to different degrees, a fact of

life in our so called democracies.

In our society, education for the majority of the population is

limited, and it is oriented mainly to the needs of the industries
within capitalist economy. It is certainly not oriented to educate
the population to independent inquiring thinking, but rather to
accept without question the ‘status quo’, and the principles and
philosophy of the establishment as the ‘law of the land’.
The media is in the hands of businessmen and, therefore, as
much as it tries to be objective and impartial, on the most
important issues it must instinctively lean in favour of Capitalism.
Even if it is often outspoken and critical about our economic and
social problems (an attitude which also promotes better ratings
and sales) it never questions the essence of the system. At most
it advocates ‘band aid’ remedies which do not threaten the
establishment, and are within the limits of capitalist economy.

Because of ignorance, biased information and a long history of

inefficiency and corruption in private and public life, the majority
of the population has become apathetic and cynical towards
politics and politicians.

Political power is delegated to professional politicians whether

they are party or union leaders, in government or in opposition.
They are more interested in being re elected than to risk their
positions and incomes by being too honest or by offending the
establishment that controls the media.

Because there is no limit to their terms of office, most of them

become ossified and entrenched. They stay on until they reach
old age, and even those who were elected to oppose the
establishment eventually tend to forget the reason why they were
elected in the first place. The majority become themselves a part
of the elite, more an instrument to stunt than to promote
movements for change.

These professional politicians have the power to appoint the

executive heads of the bureaucracy, the judiciary, the police, etc.

Most of these officials come from the middle class, and those who
do not, soon tend to join it. Therefore, conservatism pervades all
the higher levels of the capitalist structure.

Everything in ‘capitalist democracy’, including the constitution, is

aimed at preserving the capitalist system and to retard or prevent
change. This situation breeds frustration and, in times of crisis
and pressing need for change, this frustration turns into
desperation and violence of one kind or another. Violence breeds
violence and so on; therefore, this pseudo democracy step by
step turns into an oppressive regime.

A new society democratic process.

With general education oriented towards independent thinking

and social awareness, and a media which is objective and open to
all ideas and opinions in the society, what is needed for a really
democratic process is a mechanism which would hinder the
entrenchment of elected or appointed officials in positions of
power, and would prevent their gradual detachment from the
mass of the people and the main life of the society.

It is not for me to devise such a mechanism; I can only express an

opinion on what the main principles could be.

First of all, there should be a maximum limit of time on the tenure

of office, after which all elected and appointed officials should go
back to their previous occupations. Those who held office could
not be re elected again for a set period of time; but so that the
talents of those who have excelled in office should not be wasted,
they could participate in a part time advisory body or council.

The length of tenure of office could be a total of four years: two

people elected at two years distance and serving at the same
time, could intercalate every two years; such a system has
already been experimented seemingly with success. It means that
at all times there would be four people in any position of
importance, two in charge and two gaining experience.

Candidates aspiring to official positions should be subjected to a

test by an independent body to assess their competence and their
social awareness, basic Human and social education being
essential. The public then, by vote, could pick their
representatives and officials from the group of successful
candidates. This should ensure that elected officials would be
both competent and popular.

While the privacy of the personal life of every individual and

public official must be respected, there should not be secrecy in
public life or in any activity affecting the public and society. In an
educated society, people should not be treated like fools who
cannot be trusted or expected to understand why and how
decisions are made.

In public life, only persons who have something to hide or are not
sincere must favour secrecy about activities that affect the public.
The thinking process, the logic and specific data by which we
arrive at decisions that affect the society, and all records of this
process, must be open to all people. The destruction or shredding
of documents should be considered a crime.

Nobody is perfect, and mistakes are often inevitable. Therefore,

mistakes made in good faith with good intentions should not
become a personal stigma.

Regarding the overall structure of the society, the direction of

consensus and power should flow from the individual in the
smaller units and communities, and from these to the larger
organization of the society.

There should not be compulsion on small self sufficient

communities from the larger organizations self sufficiency means
independence. Participation in the larger Society should be by
free will. Self sufficient communities should not be subjected to
interference, except in circumstances when their behaviour is
damaging to the environment or to society as a whole.

The `Golden Rule’ should apply to the relations between the

communities and the wider society as it applies to the relations
between individuals. Small communities must decide for
themselves the degree of their participation within the larger
organization of the society. This probably would be related to the
degree of their self sufficiency.

The independence of small social units and communities is

essential because they are the embryos of possible alternatives.
This would allow the development of a variety of organisms,
essential for the evolution of a pluralist democratic society.

A new society - Policing.

It would be naive to believe that all economic and social problems

would be eliminated in a new society. Some problems may
disappear quickly, some may linger for a time, and we can be
sure that some entirely new problems will arise sooner or later.

We must always be vigilant and prepared to deal with them.

If the new society could be really democratic and open minded, if

it could allow the birth and existence of new ideas and
movements, and if it would allow the development of those
movements that are progressive, then such a society would have
built in a mechanism for a conscious and continuous slow
evolution, and the need for policing and repression would tend to
diminish.

Human beings are neither completely good nor bad, and the new
society will not change that.

All that we can do is to promote an economic and social

environment that will favour the development of the good rather
than the negative features of Human nature. To this effect
education and, above all, example are of primary importance. It
seems that there will always be some need for preventing and
policing crime, and for reforming or punishing those who violate
the Golden Rule.
As a guarantee that the power that this task involves should not
be abused, it should not be entrusted to persons that may
become entrenched and corrupted.

The best guarantee for personal freedom and Human rights is

that they should be guarded by each and every individual in the
society, under the supervision of elected competent councils or
committees.

Nothing comes freely; in one way or another we must pay with

our own efforts for every improvement in the society, including
the guarantee of our liberty.

It is my opinion that policing should never become a way of life

for any person in a democratic society. Therefore, we cannot
delegate the care and protection of our liberty to any entrenched
professional minority. Every person in the society in turn, at one
stage or another, should give some of his time to the task of
policing, whether within one's own community or within another.

This could minimise the obvious danger that an entrenched

professional force could pose to a democracy. This could also be
an incentive for those who are temporarily entrusted with the task
of policing to treat the public as they would like to be treated
themselves when not on such duty. Similarly, the public would
have the same incentive in regards to them.
 CHAPTER XXXII.

FUTURE PROSPECTS.

********

At present we are facing dangers that we never had to face

before. It seems that, in our blind greed and presumption, we
have put our societies and natural environment under unbearable
stress.

Humanity is at a crossroad.

There are two main prospects for the future, and within these two
prospects there are many different possibilities.

One of the main prospects is that the course of our evolution may
continue to be determined by the same irrational and destructive
philosophy of our capitalist establishment, given the fact that
they have almost absolute control over the means of persuasion
and coercion; and even more significant, they have a total grip on
the economy and the means of production.

Moreover, by having accepted the inescapable logic of Capitalism,

the mass of the public now depends on the geometrical
progression of further capital development and increasing
consumerism for employment and day to day survival; therefore,
we have locked ourselves into a course that will sooner or later
take us to complete social and ecological degeneration.

The second main prospect is that natural common sense may

prevail and that we may manage to evolve towards a more
rational and wholesome socio-economic organism without too
much bloodshed and disruption.

This second possibility presupposes that there must be a growing

world-wide movement for Humane and rational change. It seems
to be obvious that without such a movement the first prospect of
violence and chaos will become a reality because:

More uncontrolled capitalist development and consumerism will

lead to increasing ecological degradation.

More greed, inequality and alienation will lead to more violence

and social disintegration.

There is in the world today a widespread but very loose and

fragmented movement towards a better society. But
unfortunately most of the organisations which form this
movement still believe that they can obtain their aim without
changing the capitalist system.

Therefore they are expending all their energies and courage in

fighting the effects rather than the primary cause of our
ecological and social problems, which is Capitalism itself.
Moreover, after what we have seen of the ex socialist countries,
one would need a lot of courage to advance the cause for a
planned or guided economic system.

Ultimately, if these movements are really sincere, they must

realise that to become effective they cannot isolate themselves
from the primary economic factors that are causing the problems
that they are trying to overcome. Therefore, beside trying to
confront the effects, they should also point clearly at the primary
causes of the problems and, most important of all, they should
offer a practical alternative to those people and their families
whose livelihood depends from those obnoxious activities that
should be discontinued.

To ignore the primary causes would be like trying to dig holes in

the sea; eventually it would lead to frustration, a lot of people
would lose heart; for those remaining, the act of opposition in
itself, and not the ultimate result, would become the main aim
and hobby.
We must offer a positive solution, a practical alternative plan or
guide for a new world economy and society that would eliminate
the main causes of ecological and social degeneration.

This new alternative, to appeal to the majority of Human beings,

must study to avoid the obvious faults of both the capitalist and
socialist systems. It must have definite principles, they must be
put into practice, they must be made to work, and they must be
seen to work.

The embryos of such Movement already exist and the

transformation of capitalist economy and society could now begin,
even if it would be very difficult. There are different ways by
which it could be effected: In my opinion there are three main
possibilities, and I will try to outline them in general terms in the
order of their desirability, not their probability.

The first one would involve a voluntary and conscious

transformation of capitalist economy and society with the
participation of the more enlightened sections of the
establishment.

The second would involve the growth and gradual development of

a new economy and society from within the old one in the same
way as other societies, like Christianity for instance, have evolved
in our history. This second alternative could be associated with
the first and could be promoted at the same time.

The third possibility is not an alternative that we can choose. It is

a protracted process of revolutions and repression in different
places at different times with different intensity, with all the
Human tragedy and cruelty involved. This has already been going
on with different intensity, but it will become more intense if any
one of the two previous alternatives is not allowed to develop or it
is repressed.
Seldom in history a radical social and economic change has been
promoted and accomplished by en entrenched ruling elite by its
own accord. We could cite the conscious change of the economy
and society in Japan during the nineteenth century, and there the
feudal elite itself, who promoted it, was the main beneficiary.

Today there is one very slight hope that such a change supported
or promoted from the top, may be possible in capitalist society. At
least there is a chance that a sizeable section of the middle class
and a section of the managerial class may be enlightened enough
to see the necessity for a transformation, and may see the long
term advantage that such a transformation could bring to the
society, including themselves and their own children.

These are some of the main reasons

The present problems are threatening everybody, regardless of

social class.

At present, many of the capitalists' own children are suffering

because of the degeneration of capitalist society.

Wealthy people are facing increasing threats to their persons and

property therefore they are forced to isolate themselves within
complex security systems.

An increasing number of people at the top levels of our society

are insecure because of the rising pressure of competition and
fear of unemployment.

They are confused about the future, and many may already
realise that there are no rational solutions within the existing
system.

It is possible that Fascism may become a threat again. As it has

proved to be a scourge for Humanity, many capitalists may be
reluctant to accept such an alternative to save the system.
They know that in a new society their knowledge and organising
experience would be important and appreciated in the
rationalisation of a complex industrial economy. By promoting a
new society and participating in its economic organisation, they
would ensure a place for themselves relative to their ability.

There are probably more factors that could convince a section of

the establishment that a change is inevitable and desirable, and
that it would be better for everybody if it could be brought about
in a peaceful and positive way.

One of these factors is the thought about the alternatives of

violence and de humanisation that the whole society would be
facing if it was denied a peaceful transformation.

In any way, we are already continually changing; but within our

present system these changes come in twisted ways and they
produce negative results.

There are no class, religious, national or racial limitations to be a

person of good will. All that is needed is natural common sense
and a sincere desire for personal regeneration within a more
harmonious society.

Now a peaceful planned economic transformation could prevent

the hardship of economic disruption inherent in a violent
revolution.

Our present managers, by their experience in organisation, by

their influence over the media and over the public, they could
facilitate the transformation of our economy and society.

Such conscious, programmed transformation could be effected

over the period of a generation, our capitalist economy being
transformed one section at the time in the most Humane way
possible.
People who would be displaced from obsolete or obnoxious
industries would be offered compatible alternative occupations or
further education and retraining.

The young people coming out of school would readily take their
position in the economy of the new society. No one would have to
fear unemployment or a loss in the standard of living during a
peaceful planned transformation.

There would be no need for anyone to be idle, there would be so

much to do and there would be such enthusiasm and excitement
for the young generation; this may restore the natural idealism of
youth.

This may be just a dream, but the fact that it may never have
happened on such a scale in our history does not mean that it
could not happen in the future. On the small scale it happens all
the time, within families, within groups of friends, within small
communities and organisations. Why could not this happen in the
larger family of Humanity?

The capitalists are continually changing and transforming their

businesses, and the politicians are continually changing the
conditions of life for the public; they call it "restructuring",
"rationalisation", etc. and they do not care very much about what
happens to the unemployed and to their families. They say that it
is an economic necessity: that it is for the good of the country;
how much would they scream if it was done to them. No change is
impossible for them when it concerns their profits, but they tell us
that it is impossible when it concerns the public interests of a
society.

Today, with our advanced production and communication

technology at our service, motivated by the pressing necessity to
save our children's future, and with a simple philosophy resting
on basic Human Principles, a positive transformation could be
possible. The material requisites are now available. We need to
revive the conscience of honest people and to fire the idealism
and enthusiasm of the young.

The second way by which we could achieve the transformation of

our society is to gradually create a new economy and a new
society from within the old one, but it would be a slow frustrating
struggle.

Once the main principles are agreed upon, we should start to put
them into practice wherever we are and within any particular
circumstance in our existing society and economy.

Early Christianity was a radical social and economic Movement. It

was mainly for this reason that it was persecuted, and it is still
persecuted today whenever it practices its early basic principles
within societies based on the exploitation of man by man. In
Human history, Christianity is only one example of a new socio-
economic organism that grew from within one that was
degenerating.

In the present situation, people of good will and determination

should join and form communities wherever they are. They could
develop in their own way, in relation to each particular situation.

Every community should try to complement and support the

others, united in a worldwide movement. If they follow the main
principles, even if in different ways, the results should be similar:
there should be a great variety of experiences and forms, but the
essence should be the same.

Individual motivation would be of relative importance if all would

follow the same main principles, and all would seek to achieve
similar results.

If we sincerely want the same things, that is to become better

Human beings in a more just and peaceful society with a more
Humane and rational economy in harmony with nature, then it
would be of relative importance whether some people are
motivated by religious beliefs and love of God, some by love of
Humanity and Nature, most by the desire to survive in a better
world.

There are many persons of good will in all levels of society and in
every field of activity, and there are a great number of people out
of work, discarded from capitalist economy, who are reduced to a
meaningless existence.

By forming new communities, these people could find in

cooperation new ways to improve their lives and new feelings of
participation and purpose. There are many ways by which they
could cooperate.

By combining their resources and their imagination, by using any

means at their disposal, they could start their own economies
partly connected to, or independent and in competition with the
existing one, but always related and complementing other
communities that have the same principles; Good examples are
the early kibbutz in Israel and the popular organizations in the
Basque region of Spain.

Whether in industrial or rural areas, gradually, from humble

beginnings, they could grow in size and purpose; They could
acquire land, factories, they could join into contracts with existing
farming associations or individual farmers etc. As capitalist
economy is contracting, they could gradually take over, putting
into practice in the process of production the principles of
cooperation, elimination of waste of labour and materials,
etc. Therefore, in these new communities, technology would
become a servant, and the use of industrial robots and the
computer would become an advantage instead of a threat to the
working people.

Unfortunately it will not be easy and as the problem of Global

Warming requires an urgent solution; this attempt could only be
effective in conjunction with the first one.
As soon as such movement will start to grow, it will tend to erode
capitalist economy. Therefore, it will attract opposition and even
repression from the old establishment and society, as it happened
in the past whenever there were attempts to form similar
communities. Opposition will take many forms, from indirect laws
and regulations to curtail and hamper their development, to
outright violence.

Opposition will come from many different sections that have an

interest in the continuation of the old society. The ruling elites will
be forced to drop the pretence of democracy, they will have to
adopt a position of open injustice, and this will cause violence and
a polarisation of society.

People who are working and have a place in the old society will
feel threatened by the growth of the new Movement. Therefore it
is important that alternative employment and wholesome
existence must always be available for them within the new
economy and society at any time they may decide to join it, as
they are threatened to be discarded from the old. If they see that
the new society is more secure and more fulfilling than the old,
and if they see that they are welcomed within the new
communities, they may lose the interest to fight for an unjust and
lost cause.

As much independent each community may be, they all must be

related and always be in touch with one another. Moreover, it is
essential that they actively cooperate and coordinate their actions
worldwide on those issues from which Human survival depends,
mainly peace and social and ecological harmony.

It is important that such a strong Movement should start soon

because there is always present the possibility that an ecological,
or nuclear, or chemical, or biological disaster may suddenly cause
chaos on the planet. In the aftermath of such eventuality, if any
possibility is still left for survival, any group that may still be
organised would have an advantage. Therefore it is essential that
there must be already existing the basis of a Movement for a new
more rational society, whose embryos are disseminated all over
the Earth.

If the first or the second of our alternatives will not materialise, or

if after materialising they will be repressed, then the third
possibility will become inevitable, whether we like it or not.

Frustration promotes desperation, and desperation produces

desperate actions. There are always people prepared to give their
life to promote that of their children, there are always people with
hot temperaments prepared to risk their life rather than submit to
injustice, there are always a number of people for whom
revolution of one kind or another has become a way of life, there
are always people who will accept any sacrifice to promote their
ideals.

A mass of people is not always needed to start a revolution.

Revolutions are usually started by minorities in a desperate

economic or social environment. The majority of people are
gradually drawn in by gravitation and by force of events. Most
social revolutions start peacefully but eventually end up in
violence: tit for tat, they gradually escalate.

In a desperate social environment, revolutionary minorities can

never be completely eliminated: sooner or later they will form
again.

Ideas cannot be repressed as long as the situation that has

caused them to grow continues to exist. Displaced or misplaced
people will always try to change the existing socioeconomic
environment and form a new one in which they can fit.

While they are only small minorities they are not a great threat to
the established order, but when a great number of people are
being displaced they become an irresistible force for change.
Ruling elites are very much aware of this, and they are very
carefully monitoring the percentages. From history, this seems to
be the general nature of social change and revolution.

It seems to me that the best way by which we can avoid the

tragedy of revolution or terrorism is to make sure that either the
first or the second of our main peaceful alternatives for a
transformation of society are successful. We must understand this
important point, and accordingly we should make every effort to
succeed.

CHAPTER XXXIII.

THE DEMOCRATIC OPTION.

********

Let's assume that a majority of people of a country have become

convinced that capitalist economy must be replaced, and,
consequently, an anti-capitalist political organisation with a
program of drastic economic changes is democratically elected to
government.

From historical experience, whenever this has happened in the

past, several things are likely to happen:

first of all, while the anti-capitalist party in government has the

nominal political power to formulate new laws to implement its
programs, the real power still remains in the hands of capitalist
business and its class.

Business still commands the important mechanisms of the

economy, through the private ownership of the means of
production, banking, transport and the Media, through their class
influence over the commanding elements of the justice and legal
system, through their influence over the command structure of
the army and the police which for a long time have been trained
and used more to defend private property and the establishment
than the rights of the common people.

Therefore, a powerful minority in opposition can frustrate most

attempts of a progressive government to implement the reforms
for which it has been elected.

They will use any means at their disposal to protect their vested
interests: withdraw their capital, close factories or curtail
production, take the government to the High Court for
infringement of the constitution, as most constitutions of
capitalist democracies have been formulated with the main
purpose in mind to enshrine the supremacy of the right of private
property and free enterprise above all other rights.

Naturally all these actions are earnestly supported by the Media.

Moreover, as the economy is connected to the international
capitalist finance and commodities market, most foreign
investment would soon be withdrawn causing even more
disruption to the country.

The result of this strong opposition to a democratically elected

government is that, while the existing capitalist economy is
disrupted with consequent decline in production and increase in
unemployment, the alternative economic reforms to replace the
old economy are not being put in practice: they are compromised,
delayed or halted all together; a part of the public becomes
disillusioned, and the government, which was elected by a
majority, now is only supported by a minority.

If the government still insists in trying to enforce the new laws

and reforms, for which it was elected, by adopting strong
measures against the opposition, then it is in real danger; it will
be accused of being dictatorial, and the capitalist establishment
in opposition, with the support of the courts, the police the army
and the Media will have an excuse to overthrow the government.
Their professed motive will be the rescue of democracy and the
Nation.

This is what happened in the world nearly every time a

progressive party was democratically elected to government. It
shows that any establishment which controls the real avenues of
power will never willingly relinquish those powers to their
democratically elected opponents: when they direct the orchestra
their opponents are expected to dance to their tune, but when it
is their opponents who are directing they refuse to dance.

From this fact of life we must assume that it would be futile for
any progressive organisation to try to change the capitalist
system by trying to get elected to government unless it has the
support of a very great majority of the population including the
middle class, the police and the army; in addition all its
supporters must have been made conscious of the difficulties and
possible temporary hardships, its plans for reform must be ready
in every detail and also there are practical plans to overcome all
eventual economic, constitutional and foreign financial obstacles.
Moreover, only a country which can be self sufficient in raw
materials and have a fairly advanced industry and technology
would have a chance of success.

How could a transformation begin?

Now let's assume that such organisation with a great support

from all sections of society has been elected. Evidently there
would be a lot of professional people amongst its supporters,
people with experience in organisation and management, in all
industries and the media; people capable of undertaking
successfully a complex program of reform. During the years in
opposition such organization, if smart enough, would have
prepared detailed projects to be implemented without much
delay.

First of all Schools, Universities and Technical colleges should be

expanded to take care of all people that would be displaced by
such great projects of reforms so that they would not suffer and
they would be able to learn the new skills and experience needed
in the new industries that will develop.

At the same time the new government should reform the media.
Without involving the question of ownership, profits and
competition, it should remove the political advantage that media
ownership conveys to any particular class. To this effect the
government should come out and say:

We are for real democracy, we are for a real political "level

playing field; anybody can own media outlets, but, as the first
requirement of real democracy is that the people should be fully
informed about all points of views on all issues, each outlet must
provide editorial space for all points of views in the society.

Next it should be made clear to capitalist businessmen that the

new laws will be enforced in the same way as the business
establishment enforced their own laws when they were in power;
moreover, the Spirit not the letter of the Law will be enforced.

Next it should be made clear the fact that National public debt is
better than National foreign debt.

There could be advantages in foreign investments in specific

areas if it was guided by the consideration of the long term
benefit to the whole of the society, and it was not allowed to take
control of our industries and resources. Even if some of the profits
would end up overseas, several benefits would accrue to the
Nation.

It is sheer madness to relinquish all controls over foreign

investment, to deregulate the banking system and let business
entrepreneurs, who always will be motivated by narrow personal
self interest, to take charge of our foreign investment and
borrowing without any national guide or long term goal.

There is always somebody who benefit from any business deals

and activities. Evidence are the billions of invested and borrowed
money that have disappeared without trace in Australia during
the eighties without having left any real benefit to the Nation as a
whole: Switzerland and the Bahamas come to mind .

Some people have done very well: wheelers and dealers and all
their expensive private bureaucracies, legal, managerial, logistic,
public relation, advertising and general hangers on. These people
do not care whether they make their fortunes buying or selling,
selling foreign assets or selling their own country or their
countrymen.

These are true international businessmen, they are monopoly

players on the world's money and commodities markets; they can
live as well in Sydney as in London or Paris. If they are caught
cheating or if they go broke they still are left with a few millions in
their pockets. What they lose is mostly their investors' savings,
and these investors and the rest of the society are left carrying
the debt.

All this really doesn't matters if we take the point of view of the
modern businessman in the present world situation; the concept
of nationality disappears completely in the play of the "global
factory" and the "global marketplace".

When we depend on foreign borrowing or foreign investments to

develop our economy we are mortgaging part of our heritage to
foreign interests; we subject the destiny of our society to the
unforeseen vagaries of the capitalist world economy. If the debt
becomes so vast that we cannot service it, then we must sell out
our land, our industries and our resources. We become a servant
Nation or even a slave Nation: our social economic organism will
be directed by outside interests; the interests of our society will
become secondary to the interests of our foreign owners.

This unfortunately is what has happened to this country (1970-

80). Our business and political leaders must have had a hidden
agenda to throw this country into the global playing field of the
world market and world finance, without asking, without having a
mandate from the people. They joined in a big international game
of poker, they borrowed heavily and they put up the skins of the
Australian people as security. They gambled and we lost.

How much better it would have been if our Labour government

had ignored the big game outside, if they had not heeded the
advice of our international merchants. (1980s)

If we needed to borrow and get into debt to develop further, why

not borrow from ourselves and be in debt with ourselves rather
than with unknown foreign interests?

Australia is like a bank, a very rich bank. We have abundant

natural resources, plus one million of unemployed labour power,
plus another million of hidden unemployed people that could be
utilised; moreover, our industries are working at seventy per cent
capacity. This is real capital waiting to be utilised. We can borrow
from ourselves the value of this capital and, as long as we use it
to create real productive value, we cannot lose.

Here is a very simplistic but true example: if we borrow one billion

from ourselves to utilise the idle capital of our country to build
housing, when the project is completed, productive useful value
has been created: the value created equals the debt; moreover,
the rents will pay for the maintenance and will eventually in the
long run even produce a profit, the scarcity of housing will be
overcome and the cost of rent will be lower, therefore reducing
the pressure of inflation, our young people would be employed
and some of the causes for alienation, crime and drug addiction
would have been reduced; on top of this, having finished the
project, we would have again our idle capital of labour ready for
another project.

This is a simplistic example but in fact, even if such operation

would require great organisation and planning, it is quite possible.
What we need is imagination and guts, we must believe in
ourselves and in our young people. It is only the interested
Machiavellian cunning and sophistry of our mercantile
establishment that has brainwashed our society into believing
that complexity is better than simplicity, that nothing can be done
unless it is directed and motivated by private greed for profit.

It is obvious that any such public investment would create a

gradual increase in demand in all section of the economy equal to
the value of the money we would borrow from ourselves less the
savings of public expense in unemployment benefits and other
costs, and less the extra taxes that would be collected. This extra
demand in commodities and labour would create a pressure for
cost and demand inflation, therefore, both wages and prices must
be put under control. If wages are regulated prices also must be
regulated. There is no point in controlling wages to stop cost
inflation if we do not also control prices to stop demand inflation.

Finally we must consider that even if we renege on our national

debt our children would still own whatever we have created with
it; this is not the case when we are in debt with foreigners.

This sort of activities could create a great expansion in our

economy and such a demand for manpower that we may have to
import labour from overseas. In this case we should engage
foreign workers on a contract basis. Make clear the conditions of
engagement; those who would like to stay permanently should be
prepared to learn the English language and undergo a course to
understand our laws and social values; therefore, they would
become citizens and bring over their families. We could learn a lot
from each other.
While the people elected to govern the country have the duty to
put into action a plan of development that would benefit the
whole of the society, the execution of the plan should be left as
much as possible to private enterprise if they comply with the
standards set by our new socio-economic philosophy.

The elected government should set the guidelines the standards

and general specifications. It should provide the "level playing
field" in which private enterprise could compete in producing
what the society needs for its development and well being.

The elected government should set the guidelines either directly,

or indirectly by taxing any obnoxious activity out of existence and
facilitating the growth of any activity that would bring benefits to
the society and progress for the future. The principle behind this
strategy is that any activity which may cause immediate or long
term damage to the society should be charged in front for the
cost of repairing such damage.

Those activities that private enterprise could not provide should

be performed by public organisations.

Private entrepreneurs have many positive points like initiative,

imagination, daring, determination, but all these qualities are
directed mainly towards their own personal advantage, often
regardless of the damage they may cause to the rest of society of
which they are themselves part, damage from which themselves
eventually will suffer.

Merchants and business entrepreneurs have a part to play in the

economic life of the society, but they should not be the only class
to determine the destiny of the rest as they have been able to do
so far. We must call their bluff. If they cannot make fifty per cent
profit, they will try to make ten or even five per cent rather than
work for wages under somebody else, because this is the type of
people they are. They will cry, scream, threaten, but in the end
they will try to survive under any circumstance, the same as any
other person with the prospect of becoming unemployed or
redundant. If they can make more profit by their enterprises,
good luck to them; it will mean that they have been successful in
producing for the society the commodities required by the
guidelines that have been set out, with the right standards and at
the right price.

In the nature of the capitalist system of production it is not

convenient to completely satisfy the needs of the society; to
satisfy the demand it means to put capitalist enterprises out of
business.

But it is essential for the real benefit of a society that its

important needs be satisfied, in certain cases even over-satisfied,
and this should be the aim of the elected government.

Let's take the housing industry for example; automatically as

soon as profits fall, capital investment in the industry begin to fall
as well, and yet there are still a lot of people in need of decent
accommodation or forced to pay high rents. This is one of the big
problems in capitalist society that causes a lot of unnecessary
stresses in family life, especially young families. Also it is one of
the causes why inflation seldom goes below the zero level. People
and society in general should not suffer just for the sake of
keeping an industry in business; the purpose of any industry is
the complete satisfaction of the needs of the society, and,
therefore its size should be proportioned to those needs. Any
productive forces that may become redundant must be used
somewhere else where they may be needed or in completely new
enterprises.

A Nation to be really strong and independent must be self

sufficient. This should be the aim of the elected government.

Being a Nation which exports raw materials we may have to

import some manufactured goods, but we should keep this to the
minimum that is possible.
While the world is divided and under the sway of the philosophy
of greed and selfishness we should not destroy any of our
manufacturing industries, we should maintain the capacity to be
self sufficient in all vital light and heavy industries; the extra cost
that we may have to pay is the cost of maintaining a decent
standard of living and strength; this expense would be offset by
the savings in the cost of unemployment benefits and in the cost
of social degeneration.

What chance would we have, in case we may have to defend

ourselves, if we depended on help from overseas because we had
lost all our skills? Therefore besides promoting our scientists,
inventors and technicians, we should use part of our export
earnings to import the best knowledge and the best technology.
We also should develop our own in completely new fields, looking
at the future, at alternative ecologically safe sources of energy,
forms of transport, new materials, preventive medicine, recycling
of waste, etc.

We could endeavour to export our new ecologically sound,

modular, efficient and not wasteful products in the world market
in competition with the polluting, complex, wasteful products of
capitalist economy.

In our international outlook and relations we should be

internationalists, but with common sense. We live on a small
planet, the present social and ecological problems are affecting
every nation in the world, and the solutions to these problems can
only be resolved by international global efforts.

We should strive to give the good example to the rest of the world
by being successful in putting our principles into practice, and
joining forces with any other nation prepared to do the same. We
should be generous but not suckers; open minded but not stupid.
We should keep up our guard; there is no point in jumping into a
"level playing field" unless we have made sure that the playing
field is in fact level; we should not forego the national interest of
our society just for the narrow global interest of the international
business corporations.

In my opinion this country is one of the few countries in the world

where such a progressive socio-economic organism could be
successful and show the rest of the world a better way to the
future. Australia is rich in resources, it has a relatively small
population which is fairly well educated, it still has a skilled work
force and industrial technological base left after the massacre of
the last eight years (1990), the framework of a good education
system is still in place, it has a long democratic tradition even if it
is a capitalist tradition, moreover it has a mixture of all the races
and cultures of the Earth, a positive factor which turns into a
negative factor under capitalist competition and exploitation.

This was written twenty five years ago, it refer to the situation at
that time.

Tregear, 14-9-1983.

AN OPEN LETTER TO THE PRIME MINISTER Mr. HAWKE AND

THE MEMBERS OF THE LABOUR PARTY.

Mr. Hawke and colleagues,

For twenty years I have always voted Labour. I believed that the
Labour Party was the best hope for this country. I believed that
only the Labour Party had the imagination and the guts to
develop this rich and beautiful land for the future of the Australian
people, and would lead them to self-determination and self-
reliance.

I thought that never there was such an opportunity like in this

country to show the world how different races and nationalities
could work together in cooperation, grow in numbers and produce
a strong, healthy and happy society. In Australia we could have
shown the world what Humanity could do in an atmosphere of
social justice, cooperating within a rationally planned economy in
which everybody had the right and duty to participate. Not a
society of masters and servants, but a Nation of equals.

But now, Mr. Hawke, I have come to despise the Labour Party.
Already in 1973 I began to doubt the strength and wisdom of our
labour leaders. I started to realize then that you did not have a
sound strategy, and your actions were determined by expediency
and compromise. Your social objectives were becoming secondary
to your determination to stay in office at all costs as an end in
itself.

You should have known better. For seven years before you came
to power in 1972 you had the opportunity of watching the British
Lab or Party perform. You could have seen it taking the road
towards self-destruction by identifying itself with capitalist
economy and compromising everything it had stood for. England
was not ready for Labour and the Labour Party, instead of waiting
a little bit longer, for the sake of staying in office began to shift
more and more to the right. Now it has split, a derelict old
prostitute.

What good has the Labour Party's policy done to the working
people and the Lab or movement of Great Britain?

The Australian Labour Party has chosen to follow on the same

road. In the first few months after you came to power in 1972 it
became obvious, and you should have realized, that with the
Senate and big business against you, you did not stand much
chance. Before you became trapped, you should have gone back
to the people, and you should have told them that either you
should be allowed to implement your program without
compromise or you would rather go back into opposition. There,
without having lost face and credibility, you could have actively
waited for a few years letting the Liberals sink deeper into the
quicksand of their own economy; then, well prepared, you could
have taken the field. But your backsides were stuck to the seats
of office, you were blind and you did not see the snare.

You wanted to buy back Australia for the Australian people. It was
a grand idea, deserving to be proclaimed without apologies to the
four winds. But, as you could never handle the media, you chose
to go about it in a shady way. When you were found out, you
behaved like schoolboys caught doing something shameful. We
all know the result.

In 1972 you took us a step forward on the way of progress. Since

1975 we have been pushed several steps backwards. In this way
you did a disservice to us and to yourselves.

There is no point for you to be in government if you can do no

good. We can defend ourselves from those who want to exploit
us, but how can we defend ourselves from those who profess to
be acting on our behalf?

After 1975 until March of this year I still hoped that not everything
was lost. I was hoping that you would have learned the lesson of
what had happened to you and to the British Labour Party. But I
finally must realize that I was wrong. Your only solution to the
problem of handling the media is to comply with its requirements
- to pay lip service to your old ideals and to do as those who
control the economy and also influence the media tell you.
Without reserve you have chosen to tie yourselves and us to the
rotten ship of capitalist economy that is slowly sinking. You have
decided to outdo the Liberals in futile efforts to save a hopeless
economy, no matter how much it hurts. This is why the Liberals
are in disarray, you have stolen their place and now they are
worried. If your objective was to be in government for the sake to
be in government, then you have got it made as long as you can
deliver the unions, the media will be your friend. The Liberals will
have to shift further to the Right, as the Conservatives did in
England, and they will be ready to take over when those who
control the mass media will decide that you have become
redundant. In the meantime we and the country as a whole will be
the losers.

Mr. Hawke, in our two party system one capitalist party was quite
enough. Why have two?

Why not let those who believe in this obsolete economy to sink
with it? And in the meantime we could prepare and organize
ourselves in every detail for a new alternative, a new Dawn? Do
not worry about the liberals making a mess of the economy; they
will not make a bigger mess than what you will eventually make.

In you and the Labour Party I can see now the demise of a social
movement that has completed its full cycle of evolution - from a
progressive beginning to a conservative end. But in our two
parties political system you were our only hope. Now we have
been left without any real alternative. In substance Australia has
become like a banana republic under a disguised capitalist
dictatorship without any meaningful opposition -

Thanks to your kind, Mr. Hawke

This is why now I despise the Layout Party

You have tied us without a way out to the sinking ship of

international capitalism. We have lost our freedom of action. We
have sold our independence to a foreign country whose economy
feeds on a policy of brinkmanship for the benefit of a self-
perpetuating industrial-military complex. A country whose
government believes that it can win and survive a nuclear war by
striking the first blow. A country that is suffocating in violence,
that is mislead by the machinations of a hard-line administration,
where the security services are intertwined with organized crime.

We had a unique opportunity in Australia to start something clean

and new, but you have let us down. You have abused our
confidence; you have confounded us and left us without real
hope.

That is why now I despise the Labour Party.

You call for “accord" and compromise to save capitalism. But for
us “accord” means that we must accept quietly to be sacrificed to
the dictates of an economy that has become irrational that will
never fully recover. Moreover, what have we to compromise Mr.
Hawke?

Many of us are already out of work, some are confined at home in

darkness as transport and electricity have become luxuries for
them, and they are too proud to beg. Those of us who are still
working are constantly in fear of redundancy; therefore we have
to compete against each other’s like in a snake pit. What else
have we got to compromise?

How long will the unemployed have to stand the look of reproach
or pity of those who do not understand? How long will we have to
withstand the stresses that this situation puts on our families and
our lives? Soon the shame of being cast outside the economic and
social life of the society will turn into desperation, desperation
into rage. We do not want handouts; we want a purposeful
participation in a more just and rational society. Not in the distant
future, we want it now. It is easy for the like of you to say that we
must be patient.
In your economic plans for our future, how much is the cost of the
degeneration, loss of pride and hope of just one young person,
Mr. Hawke? Did you put a price on it? Will that young person ever
be redeemed in three, four or more years when, as you say, the
U.S. willing, our economy may recover? Or will that young person
have been wasted forever and for nothing? Multiply this tragedy a
thousand times, a million times, Mr. Hawke.

Do you realise that you and your Party have assumed this
responsibility?

Why not leave it to the Liberals who honestly believe in capitalist

economy, and actively prepare yourself and us for a more rational
and humane alternative when they fail?

But in your vanity you have taken their place, you have
compromised yourself, you have set yourself as a scapegoat. You
have not learned the lesson of 1975; you have got it all wrong.
How silly will you look in history? You have assumed a place in the
"dustbin of history”. But what about us in the present?

Who will we turn to in this two Party system, Mr. Hawke, when
you fail?

Can we turn to the Liberals?

You should know that the laws and mechanism of capitalist

economy cannot be harnessed, and that its nature cannot be
changed.

This is why I despise the Lab or Party, Mr. Hawke

You have compounded the confusion of the good-natured

Australian people. You are leading us either to a nuclear war to
save capitalism or to an endless agony of sacrifices and
degeneration, in a land of plenty, amidst a revolution in the
technology of production never seen before. Does it make sense
to you, Mr. Hawke?
You are repeating over and over that there is no money and that
we must increase the profits of business; but Adam Smith, "the
father figure of capitalism, who was an honest man, said two
hundred years ago that real wealth is not in money but in the lab
or of Man and in the Land; money is our invention. Why are we
unemployed, Mr. Hawke?

Why are people, the real capital of a nation, rotting without work?

Adam Smith also said that we should never allow capitalist

businessmen to become “the rulers of mankind”, and he warned
that we should be always "suspicious" of "their advices.

Why do you kneel in front of them, Mr. Hawke?

This is why now I despise the Labour Party, Mr. Hawke.

By trying to save a system that has become obsolete, irrational

and destructive you do not save us, Mr. Hawke; you are hurting us
by prolonging and aggravating our agony and that of our children.
Let the Liberals do it, not Labour; how can we defend ourselves
from those who profess to be our friends and abuse our name?

Do you realize that your economic cures are killing us? We cannot
afford to keep people in hospitals, criminals in prison, patients in
mental homes; we cannot look after our young or after the old.
The British Laborites were doing the same in England ten years
ago, look were they are now.

With the progress in technology, in the land of milk and honey, we

cannot afford any more those services that were considered
essential and commonplace when technology was less advanced
and production was much slower. Does it make sense to you, Mr.
Hawke? Try to analyze more deeply your explanations for this
situation and honestly see if there is any natural common sense
and human rationality in your reasoning.
Are you trying to con us when you repeat like a parrot over and
over that we must become competitive on the world market? Did
it ever cross your mind the obvious fact that another one hundred
nations are doing the same and already some are sacrificing their
populations ten times more than you do, Can you imagine what
will be the result of this stupid race amongst Nations to throw
each other out of' work? Who will benefit, Mr. Hawke?

Do you really believe in what you are saying? Mr. Hawke? We may
be fools. But what are you? An honest dill or an intelligent crook?

These are some of the reasons why now I have come to despise
the Lab or Party and also you, Mr. Hawke.

Tregear, 14-9-1983.
A letter that I sent to Mr. Kevin Rudd and members of the
Australian Labour Party I October 2008 during the escalation of
the financial Meltdown.

Warwick Farm Sat 20 October 2008.

AN OPEN LETTER TO THE P.M. KEVIN RUDD AND THE

MEMBERS OF THE LABOUR PARTY.

Over the last thirty five years, the Labour Party has been
persuaded to adopt the philosophy of the Capitalist Market, Milton
Friedman, Mrs. Thatcher, Mr. Reagan, small government,
privatization and deregulation. As you have given up your early
social economic platform, the two parties in Australia have
become almost indistinguishable from one another and because
the Capitalist Global Market is the same tyrant over all of you, you
must react in similar way to the vagaries of the system; therefore
you have created a virtual capitalist dictatorship and have left the
Australian People with no alternative but to continue on an
ecologically and socially destructive capitalist dead end road.

If you are deluding yourselves that you can harness the present
merchant economy without the moderating influence of a Public
National bank and also you are allowing the people whose greed
and duplicity have created this collapse to still be in charge and
to give you their interested advice, then you are fools… “vulpes
pilum mutat, non mores…”. Let them pay for their mistakes and
submit to the consequences of their gambles; with a more
intelligent and honest statute the Public Bank can become the
lender to the real productive economy.

Please do not try to save the system as is. ” Merchants should

never be completely trusted…” and “...merchants should not be
allowed to become the masters of mankind” (Adam Smith, The
Wealth of Nations 1723-1790), it is not too late.

Have the courage to recreate a Public Bank as Labour did in 1911,

and then you privatized in the 1980s. To this purpose use the
Billions you intend risking to save the compromised financial
system. Also use the out of work staff and deposits of those
private banks that eventually will go into liquidation.

Allow only the honest and progressive sections of the Capitalist

system to survive and prosper; the Public must provide the
necessities that Private Enterprise is not willing or capable of
providing. Food production and housing are the basis of life;
therefore special consideration should be given to good farmers
and good farming. Housing should not be just an investment for
speculators, it is a Human necessity that should and can be
completely satisfied. Eventually the industry can be directed to
other productive necessities.

Promote the development that will provide employment in the

production of clean energy, in reforestation, in recycling, in
cleaning the pollution we have caused, in education, in research
and more projects…

It should be evident that Capitalism has become incompatible

with the new saturated environment that it has created: a planet
under stress, Capitalism cannot be harnessed, it cannot be slowed
down; slowing down means depression and unnecessary long
lasting pain for the majority; Capitalism to survive requires
continuous unbounded development, consumerism and waste:
these are the main causes of the present Human and Ecological
degeneration. Development without guidelines is as obnoxious as
finance without regulation. Capitalism must continually expand
“under pain of extinction” (Karl Marx 1850).

If the carbon that we have put in the atmosphere cannot be

reduced, it means that every day, every ounce we produce will
increase the amount of pollution; reducing emission only means
reducing the amount of further accumulation: reducing emission
by 20 % means sending up there 80 tons instead of 100 tons on
top of what is already up there. Increasing economic development
directed by the whims of selfish investors will only accelerate the
degree of global warming that is increasing the temperature of
the environment which was the condition for our evolution. Can
we trust Capitalism in any form except in a straight jacket?

About forty years ago we started to realize that something never

envisaged before was happening to the planet, but only last year
the free marketers, deregulators and their political
representatives were forced to admit that there was a problem.
Now that almost everybody is convinced, they are still dragging
the chain because their mercantile nature is incompatible with
the present ecological requirements: they cannot comprehend
anything that is not done for monetary profit. As we all are either
businessmen or working for them we are all locked in a situation
that if they go broke we soon all will be on a scrap heap; if we
cannot change our capitalist mentality and continue polluting you
are racing towards an unknown but very hot future. The planet
Earth will survive, but will you?

This Labour Government has the one in a lifetime chance to start

such a renewal as mentioned above and be an example to the
rest of the World, if you let it pass you will be remembered as the
greatest idiots or corrupted hypocrites in the last tragicomedy in
the history of the Human Race; how Mr. Hawke and Mr. Keating
the privatizing and deregulating Placido Domingos of the
Australian economy look now?
You must take heart, if you have any left; you must institute a
new Public Australian Bank that will be the best guaranty for
keeping the private financiers honest and refrained from
profiteering. They will hate this, the Media and the Coalition will
be at your throat and you may have to have a referendum.
Remember Labour of 1911; the Federal Government and
eventually every State had their own banks and Insurance
companies; those institutions were loved by the Australian Public.
You seem to be mesmerized by the financial establishment and
the Media, which after the mess they have created are completely
discredited; can you still have faith in them?

In the present circumstances it would not be difficult to make a

break, but as the Labour Party and the general Public have been
convinced over the years that there are no alternatives to
Capitalism, it is evident that to have any chance of success it is
essential that the Public must be informed, convinced of the
necessity for a real change.

For this, the DEMOCRATISATION OF THE MASS MEDIA is

imperative: for a True Democratic Society full and universal
information is essential. Unfortunately at present as in the past
there is only the biased conservative capitalist Mass Media that is
influencing the Public and is manipulating the politicians; the
independence of the ABC and SBS having been eroded there is no
voice for any alternatives to the present system. Therefore, the
Mass Media must not be allowed to misinform and mislead the
Public; to this purpose, it should be directed to provide space for
alternative views that may be questioning or opposing their
editorial vested interests; they have the right to their profits, but
not the right to monopolize public opinion.

There is so much that you seem to have forgotten about the Real
Labour Movement, it is enough to mention Mrs. Thatcher’s claim
that “New Labour was her greatest achievement” and you seem
to have adopted the same economic way of thinking. I will stop
now because I am afraid that my effort will be wasted on your
small minds; also because I imagine that those who would have
managed to read to this point would probably laugh and think:
who is this idiot? Trin Tragula?.... Please let me know if you have
received this letter. I include also a letter that I sent to Mr. Hawke
and the Members of the Labour Party in 1983, about three
months after the elections.

Regards, ***” Trin Tragula”