Economics for Social Democrats–but not for the Working Class, Part Three: Critique of Jim Stanford’s Theory of Money, Part Three, or How Commodities and Money Dominate Our Lives

Introduction

I have already criticized Mr. Stanford’s definition of money as purchasing power in two previous posts (see Economics for Social Democrats–but Not for the Working Class, Part Two: Critique of the Social Democrat Jim Stanford’s Theory of Money, Part One   and Economics for Social Democrats–but not for the Working Class, Part Two: Critique of Jim Stanford’s Theory of Money, Part Two). I turn now to the social effect of commodity and money production as commodity fetishism and money fetishism. 

Mr. Stanford’s definition of money fails to connect it to the peculiar kind of social labour that produces commodities and how this peculiar kind of social labour necessarily gives rise to money as the monopolizer of purchasing power. To repeat his definition of money (from Economics for Everyone: A Short Guide to the Economics of Capitalism, 2008, page 189: 

Very broadly, money is anything that allows its holder to purchase other goods and services. In other words, money is purchasing power.

We can compare this with Marx’s views on money. From pages 168-169: 

The forms which stamp products as commodities and which are therefore the preliminary requirements for the circulation of commodities, already possess the fixed quality of natural forms of social life before man seeks to give an account, not of their historical character, for in his eyes they are immutable, but of their content and meaning. Consequently, it was solely the analysis of the prices of commodities which led to the determination of the magnitude of value, and solely the common expression of all commodities in money which led to the establishment of their character as values. It is however precisely this finished form of the world of commodities – the money form – which conceals the social character of private labour and the social relations between the individual workers, by making those relations appear as relations between material objects, instead of revealing them plainly.

Since money as simply given hides the “social character of private labour and the social relations between the individual workers,” it is necessary to analyze how it arises theoretically (and practically through the actual exchange process)–which is what Stanford precisely fails to do. From Capital, page 139: 

Everyone knows, if nothing else, that commodities have a common value-form which contrasts in the most striking manner with the motley natural forms of their use-values. I refer to the money-form. Now, however, we have to perform a task never even attempted by bourgeois economics. That is, we have to show the origin of this money-form, we have to trace the development of the expression of value contained in the value-relation of commodities from its simplest, almost imperceptible outline to the dazzling money-form. When this has been done, the mystery of money will immediately disappear.

For Stanford, however, there is no mystery to money. It is simply the power of a specific thing to purchase other things. How and why money permits its owner to purchase other things–including the capacity of workers to perform human labour–remains a mystery on the basis of Stanford’s definition. Stanford, in fact, merely assumes the power of money to purchase commodities. At least eighteenth and nineteenth century political economists were able to infer from exchange relations that labour formed their basis as value (although they also assumed that the kind of social labour that produced value was concrete labour). From pages Capital, 173-175: 

Political economy has indeed analysed value and its magnitude, however incompletely,  and has uncovered the content concealed within these forms. But it has never once asked the question why this content has assumed that particular form, that is to say, why labour is expressed in value, and why the measurement of labour by its duration is expressed in the magnitude of the value of the product.  These formulas, which bear the unmistakable stamp of belonging to a social formation in which the process of production has mastery over man, instead of the opposite, appear to the political economists’ bourgeois consciousness to be as much a self-evident and nature-imposed necessity as productive labour itself.

The above quote links up to the theme of commodity fetishism and money fetishism, or the loss of power by workers over their own life process (the production process of their own lives) and the positive acquisition of power of the things they produce–commodities, money and, ultimately, capital. 

Mr. Stanford’s definition of money as “purchasing power” fails miserably to address something which is very relevant for members of the working class: Why does the ownership of money by employers confer so much power over the workers at work? 

By severing the connection between the positive monopoly of immediate purchasing power of money from the negative lack of such power of commodities, Stanford fails to grasp the organic or internal connection between the difference in power between commodity power–especially the commodity called labour power–and money power (represented by the employer)

Part of the answer to the question of the asymmetry in power relations between the owner of commodities and the owner of money is found in Marx’s theory of commodity fetishism, and the associated theory of the money fetish, which is really a development from commodity fetishism. By fetishism is not meant some kind of personal fetish, such as a fetish for a particular part of the human body or a particular item of clothing. Rather, it is a fetish in that human powers appear as the power of things, whether as commodities (commodity fetishism) or as money (money fetishism), or indeed as a thing called capital (capital fetishism). As Elena Lange (2021) notes, Value without Fetish Uno Kōzō’s Theory of ‘Pure Capitalism’ in Light of Marx’s Critique of Political Economy, page 225: 

The inversion of the problem – money is not to be explained on the basis of the fetish character of the commodity, but the commodity is to be explained on the basis of the fetish-character of money – however leaves open the question how money is capable of paradigmatically representing general social exchangeability.

Stanford, with his one-sided positive definition of money as purchasing power, cannot link the power that ownership of money confers to the employer. He cannot do so since he fails to link the nature of money in a capitalist society to the nature of the kind of labour that requires money as an external power (“purchasing power”).  Money for Stanford  just has purchasing power–it appears to have this active power independently of the way in which the producers’ own labour (the labour of the working class) is organized and how they relate to each other by way of the topsy-turvy relation between things (commodities and money).

The Nature of Commodity Fetishism–and the Domination of Workers 

Stanford cannot understand the nature of commodity fetishism since he simply assumes that a thing called money has purchasing power by nature. He obviously rejects connecting the nature of money to the peculiar social labour that produces commodities. In fact, I doubt that he is even aware of the connection (since he interprets Marx’s labour theory of value as some sort of moral theory that is applicable throughout history). 

Commodity fetishism arises because the labour performed by the workers is not social labour as it is being performed and, as a consequence, the relations between the labours of workers who work for different and independent employers lack direct social connections. Materially, though,  they form, interdependent relations. At the brewery where I worked, for example, brewery workers did not produce the bottles that they needed to produce the beer, nor the barrels of soap needed to make the bottles move smoothly along the line, nor the chains on which the bottles moved, nor the machines, such as the soaker, the filler or the labeler. There was thus a material dependence of the workers in the brewery on the workers who produced the bottles, the barrels, the soap, the chains, the soaker, the filler and the labeler. 

The labour performed by us to produce the beer, though materially dependent on other labour processes, did not express its dependent nature directly by means of those who produce beer, along with the whole set of other workers jointly communicating and deciding on what to produce, how much to produce and how to produce according to the diverse productive and personal needs of the producers (and other members of society). Rather, the dependent (and interdependent) nature is only expressed indirectly, through the relations of commodities to each other in the exchange relation and the exchange process–since the labour performed during production in a society characterized by a class of employers is only social labour indirectly. The commodities themselves then obtain human characteristics that appear to arise from the nature of the commodities as natural things (such as beer) rather than through their nature as social things. Thus, beer having a price seems to arise from the nature of beer  whereas price in fact arises in the first place because of the organization of production as private, isolated production.  This attribution of social relations between humans as an attribute of commodities and their relations is what Marx calls commodity fetishism. From Capital, Volume 1, pages 164-166: 

The mysterious character of the commodity-form consists therefore simply in the fact that the commodity reflects the social characteristics of men’s own labour as objective characteristics of the products of labour themselves, as the socio-natural properties of these things. Hence it also reflects the social relation of the producers to the sum total of labour as a social relation between objects, a relation which exists apart from and outside the producers. Through this substitution, the products of labour become commodities, sensuous things which are at the same time suprasensible or social. In the same way, the impression made by a thing on the optic nerve is perceived not as a subjective excitation
of that nerve but as the objective form of a thing outside the eye. In the act of seeing, of course, light is really transmitted from one thing, the external object, to another thing, the eye. It is a physical relation between physical things. As against this, the commodity form,
and the value-relation of the products of labour within which it appears, have absolutely no connection with the physical nature of the commodity and the material relations
arising out of this. It is nothing but the definite social relation between men themselves which assumes here, for them, the fantastic form of a relation between things. In order, therefore, to find an analogy we must take flight into the misty realm of religion. There the products of the human brain appear as autonomous figures endowed with a life of their own, which enter into relations both with each other and with the human race. So it is in the world of commodities with the products of men’s hands. I call this the fetishism which attaches itself to the products of labour as soon as they are produced as commodities, and is therefore inseparable from the production of commodities.

As the foregoing analysis has already demonstrated, this fetishism of the world of commodities arises from the peculiar social character of the labour which produces them.

Objects of utility become commodities only because they are the products of the labour of private individuals who work independently of each other. The sum total of the labour of all these private individuals forms the aggregate labour of society. Since the producers do not come into social contact until they exchange the products of their labour, the specific social characteristics of their private labours appear only within this exchange. In other words, the labour of the private individual manifests itself as an element of the total labour of society only through the relations which the act of exchange establishes between the products, and, through their mediation, between the producers. To the producers, therefore, the social relations between their private labours appear as what they are, i.e. they do not appear as direct social relations between persons in their work, but rather as material relations between persons and social relations between things.

It is only by being exchanged that the products of labour acquire a socially uniform objectivity as values, which is distinct from their sensuously varied objectivity as articles of utility.

Stanford, by assuming as given that money has purchasing power, fails to derive such power from human relations characteristic of a society where the workers lack the power to direct their own lives and–therefore–money arises as a result that permits others to direct their lives.

Stanford presents the purchasing power of money as natural to money–it is (“that is the way it is” attitude–with a shrug of the shoulders). The purchasing power of money, however, derives from the lack of such power by commodities, and the lack of such power is in turn derived from the nature of the labour that produces value–abstract labour, or labour that is not social as it is being performed but requires a further process–a process of exchange–if it is to form part of the labour of society. 

In a society characterized by the production of commodities and their expression in money (with its immediate power to purchase), the power of workers to produce their social lives (reciprocal production of human life) assumes the form of a relation between things produced. The origin of commodity and money fetishism is thus in production–the way production is organized. From Guido Schulz (2012), “Marx’s Distinction between the Fetish Character of the Commodity and Fetishism,” in pages 25-45, Studies in Social & Political Thought, Volume 20, page 26: 

The fetish character of the commodity, which Marx also calls “mystic character”, originates in the “peculiar social character of the labour” that gives products their commodity form. Therefore, the fetish originates in production. Although production is ultimately social under capitalism, it is privately organized and carried out by atomised producers. Capitalist production thus entails a conflict between sociality and asociality. An objective mediation between the two extremes of sociality and asociality is established through the process of commodity exchange. The social relation between the producers is thereby established. Instead of consciously creating immediate links between the
producers, in place of “rationally regulating [production], bringing it under […] common
control“, the social link gets reified and externalized in commodities.

Abstract labour as labour that is not yet social assumes the form of a relation between commodities, things with physical and supersensible (social) qualities that regulate the participants in exchange rather than the participants regulating the process. From Guide Schulz, page 27: 

But value relations objectified in commodities do not only establish the socializing link between producers. From the viewpoint of the individual producer, these objectified value relations even gain autonomy and regulative social power. This non-imaginary regulative social power is twofold: “[R]elations based on the exchange-value of commodities (‘social relations of things’) come to control the distribution of labour-products and the distribution of the labourers themselves within the production process” (Carver 1975, p.51).

All human production is social in character in that, if we are to produce our lives and continue to live as a species, we must in one way or another work for each other in even a temporary social division of labour. This “working for each other,” however, in a situation where labour is not social as it is being performed, assumes the form of a relation between produced commodities, with the social nature of the labour expressed not in the immediate or material form in which it exists but in another use value (as I have already explained in an earlier post–see  Economics for Social Democrats–but Not for the Working Class, Part Two: Critique of the Social Democrat Jim Stanford’s Theory of Money, Part One). If there are two commodities produced, say beer and a pair of pants, the social nature of beer production is not expressed in the beer but in the pair of pants. From Samezo Kuruma (2018), Marx’s Theory of the Genesis of Money How, Why, and Through What is a Commodity Money? page 144:

How, exactly, is the value of a commodity indicated? Given that a commodity cannot indicate its value on its own, it is indicated instead by another commodity with which it is in a relation of exchange. Yet in the case of that other commodity as well, its natural form is its use value (not value), and it does not, on its own, have a form of value in addition to its natural form. The natural form of that other commodity must therefore become the form of value. This is indeed what happens … he [Marx] traces the development of the
form itself, and in so doing thoroughly solves the riddle of money.

The pair of pants in this case is immediately exchangeable or convertible into the beer since it represents objectified social labour–objectified labour that is freely convertible into any useful form. Similarly, the  labour that produces the pair of pants represents general social labour, or labour that can assume many different forms. The pair of pants is immediately exchangeable with the beer (its “purchasing power”) despite the concrete labour that produces the pair of pants being separated off and being produced independently of the other commodities  because this particular labour represents general social labour. 

This power of immediate exchangeability, or its purchasing power, is derived from the negative way production is organized in a capitalist society; there is no unity of workers with each other as human beings who produce for each other. The unity arises through the emergence of a special commodity that functions as an external unifier of producers who are socially external to each other despite their material interdependence. 

It is through the development of this simple expression or form of value–the value of the beer being expressed in another use value, the pair of pants or what have you–that there arises the money form, as the final form where value achieves a uniform and general expression in just one commodity that then becomes money as the monopolizer of general exchangeability or purchasing power ultimately emerging from the nature of abstract labour and embodied in one particular use value (and hence one particular form of concrete labour). 

The property or characteristics of commodities as social products requires a form different from their immediate use value as the product of concrete labour. This form–ultimately the money form or money–then has the social characteristic of being immediately exchangeable or convertible into any particular commodity or use value.

This social power is transferred to commodities, but only potentially, not immediately since commodities cannot immediately express their value in their own use value. In turn, this social power becomes concentrated in one commodity–which becomes money.

Stanford, by ignoring completely the process by which money acquires the immediate power to purchase all other commodities, himself contributes to commodity fetishism since he fails to link the property of money of having immediate purchasing power with the lack of such power of commodities and, in turn, their lack being due to the peculiar social nature of the labour that produces the value of commodities. 

The Nature of Money Fetishism

The fetish character of commodities is a simpler form than the money form since the relations between producers is still expressed as a relation–although a relation between things. From Marx, Capital, Volume 1,  page 176: 

As the commodity-form is the most general and the most undeveloped form of bourgeois production, it makes its appearance at an early date, though not in the same predominant and therefore characteristic manner as nowadays. Hence its fetish character is still relatively easy to penetrate. But when we come to more concrete forms, even this appearance of simplicity vanishes. Where did the illusions of the Monetary System come from? The adherents of the Monetary System did not see gold and silver as representing money as a social relation of production, but in the form of natural objects with peculiar social properties.

Does Mr. Stanford enlighten workers on how money has the property of “purchasing power?” Not at all. He assumes such a property as given without explaining it. The money form, however, is a form that hides its own nature. From Marx, Capital, Volume 1, pages 168-169: 

It is however precisely this finished form of the world of commodities – the money form – which conceals the social character of private labour and the social relations between the individual

Commodity fetishism, as a social relation between workers as exchangers that assumes the form of a relation between things, is converted into a money fetishism as money emerges as the unique power of a commodity to be converted immediately into any commodity form.  Money thereby assumes the form of a thing that has–“purchasing power”–by its very nature, apparently  independently of the nature of commodities and commodity production. Money fetishism is a development of commodity fetishism. From Desmond McNeill (2021), 
Fetishism and the Theory of Value: Reassessing Marx in the 21st Century, pages 61-2: 

There is a similar important passage later in the same volume [of Marx’s book A Contribution to the Critique of Political Economy, published in 1859]:

A social relation of production appears as something existing apart from
individual human beings, and the distinctive relations in which they enter
in the course of production in society appear as the specific properties of a
thing. … This perverted appearance manifests itself merely in a more striking
manner in money than it does in commodities. (Marx 1970: 49)

Here, Marx is making the point that money fetishism is a developed form of commodity fetishism.

As Georgios Daremas (2018) says, “The Social Constitution of Commodity Fetishism, Money Fetishism and Capital Fetishism,” in pages 219-249, Judith Dellheim Frieder Wolf, Editors, The Unfinished System of Karl Marx Critically Reading Capital as a Challenge for our Times  page 226: 

An inversion has taken place: money—instead of being seen as a reflector of a commodity’s value (as the universal equivalent or representative, as the passive agent of reflection)—is perceived as the active agent positing the value of the commodities. From a logical point
of view, the basis of money fetishism is the collapse of a relationship of reflection/representation to that of an identity. The inner connection of the commodity’s value represented by the money form is reduced to a social feature inherent in money per se that appears to hold an external, contingent connection to the multiplicity of commodities bestowing value upon them.

Stanford, by assuming the purchasing power of money without explaining it, reinforces the fetishism of money. This is hardly in the interest of workers. 

Probably in a follow-up post, I will in future elaborate on the further development of commodity fetishism and money fetishism as capital fetishism (I have already hinted at such a fetishism in referring several times to the domination of workers’ lives by their own actions and by the products of their labour). 

Conclusion

The way in which the labour process is organized in a society characterized by a class of employers involves the relations between workers assuming the absurd form of a relation between things leads to the mystery of why a particular commodity–money–has the magical ability to purchase all other commodities whereas they, on the contrary, lack such power. 

Commodity fetishism is easier to understand than money fetishism since it relates more directly to the production process and involves the expression of value in a not-yet fixed form. With money fetishism, on the other hand, money seems to have purchasing power capacity immediately, independently of the organizational structure of labour. Stanford, by simply accepting the purchasing power of money without linking it to that structure, contributes to hiding the real nature of money and the real nature of commodities as alienated forms of human social labour. 

It is instructive of how dominant social democracy and social reformism are here in Toronto (and undoubtedly in many other capitalist cities) is the lack of any criticism of Stanford’s definition of money. 

I will conclude this post in anticipation of a possible future post on capital fetishism by quoting from Thomas Hodgskin’s book (1825), Labour Defended against the Claims of Capital: 
Or the Unproductiveness of Capital proved with Reference to the Present Combinations amongst Journeymen, pages 71-73: 

Betwixt him who produces food and him who produces clothing, betwixt him who makes instruments and him who uses them, in steps the capitalist, who neither makes nor uses them, and appropriates to himself the produce of both. With as niggard [stingy] a hand as
possible he transfers to each a part of the produce of the other, keeping to himself the large share. Gradually and successively has he insinuated himself betwixt them, expanding in bulk as he has been nourished by their increasingly productive labours, and separating them so widely from each other that neither can see whence that supply is drawn which each receives through the capitalist. While he despoils both, so completely does he exclude
one from the view of the other that both believe they are indebted him for subsistence. He is the middleman of all labourers … Not only do they appropriate the produce of the labourer; but they have succeeded in persuading him that they are his benefactors and employers. At least such are the doctrines of political economy; and capitalist may well be pleased with a science which both justifies their claims and holds them up to our admiration, as the great means of civilising and improving the world.

The Rate of Exploitation of Workers at Magna International Inc., One of the Largest Private Employers in Toronto, Part Three, Updated, 2020

Introduction

In two others posts I presented the twenty largest employers in Toronto according to level of employment (see A Short List of the Largest Employers in Toronto, Ontario, Canada) and the twenty largest employers in Canada according to profit (see A Short List of the Largest Private Employers in Canada, According to Profit).

I have tried to calculate the rate of exploitation of workers of workers in several capitalist companies: Magna International, Bell Canada Enterprises (BCE), ScotiaBank (Bank of Nova Scotia), Bank of Montreal (BMO), Telus, Royal Bank of Canada (RBC), Suncor Energy, Toronto-Dominion Bank (TD Bank),Rogers Communications Inc., the Canadian Imperial Bank of Commerce (CIBC) and  Air Canada,  (see for example The Rate of Exploitation of Workers at Magna International Inc., One of the Largest Private Employers in Toronto, Part One).

I thought it might be useful to begin the comparison of rates of exploitation of the same capitalist employer for different years. Although this fails to capture the dynamic of capitalist relations of production and exchange (being two snapshots at different times), it may provide further insight into the nature of capitalist society.

The structure of the post is as follows:

  1. I outline the nature of the rate of exploitation
  2. I then provide “Conclusion first,”
    a. the 2020 rate of exploitation is indicated
    b. the 2020 rate of exploitation is compared with the 2019 rate and some possible explanations of the differences are provided
    c. a long quote of a discussion around tactics and strategies between Sam Gindin (former research director of the Canadian Autoworkers Union (CAW) (now Unifor) and me relating to  union ideology.
    d. Further brief criticisms of Mr. Gindin’s political position
    e. Consideration of an Integram Bargaining Report produced by Unifor Local 444 (Integram is a division of Magna International), dated November 8, 2020 in relation to Mr. Gindin’s views
  3. How I calculated the rate of exploitation (including adjustments) as well as a justification for interpreting the substantial decrease in the rate of exploitation in terms of “fixed costs.”
  4. The conclusions as stated in 2.

The Nature of the Rate of Exploitation

But what is the rate of exploitation? And why not use the usual rate of profit or the rate of return? The rate of profit is calculated as profit divided by investment. Since employers purchase both the means for work–buildings, computers, office supplies, raw material–and hire workers–we can classify investment into two categories: c, meaning constant capital, or the capital invested in commodities other than workers; and v, or variable capital, the capital invested in the hiring of workers for a certain period of time (wages, salaries and benefits).

The purpose of investment in a capitalist economy is to obtain more money (see The Money Circuit of Capital), and the additional money is surplus value when it is related to its source: workers working for more time than what they cost to produce themselves. The relation between surplus value and variable capital (or wages and salaries) is the rate of surplus value or the rate of exploitation, expressed as a ratio: s/v.

When the surplus is related to both c and v and expressed as a ratio, it is the rate of profit: s/(c+v).

In Marxian economics, you cannot simply use the economic classifications provided by employers and governments since such classifications often hide the nature of the social world in which we live. The rate of profit underestimates the rate of exploitation since the surplus value is related to total investment and not just to the workers. Furthermore, it makes the surplus value appear to derive from both constant capital and variable capital.

I decided to look at the annual report of some of the largest private companies in Toronto and Canada if they are available in order to calculate the rate of exploitation at a more micro level than aggregate rates of surplus value at the national or international level. Politically, this is necessary since social democrats here in Toronto (and undoubtedly elsewhere) vaguely may refer to exploitation–while simultaneously and contradictorily referring to “decent work” and “fair contracts.” Calculating even approximately the rate of exploitation at a more micro level thus has political relevance.

Conclusions First

As usual, I start with the conclusion in order to make readily accessible the results of the calculations for those who are more interested in the results than in how to obtain them.

The Rate of Exploitation

So, with the adjustments in place: s=1081; v=2,509. The rate of exploitation or the rate of surplus value=s/v=1081/2,509=43%.

I will first consider this rate in relation to the workers in 2020, and then compare this rate with the 2019 rate of exploitation.

That means that for every hour worked that produces her/his wage, a worker at Magna International works around an additional 26 minutes for free for Magna International. Alternatively, in terms of money, $1 of wage or salary of a regular Magna International worker produces around $0.43 (43 cents) surplus value or profit for free.

  1. In an 8-hour work day (480minutes), the worker produces her/his wage in 336 minutes (5 hours  36 minutes) and works 144 minutes (2 hours 24 minutes) for free for Magna International.
  2. In an 9-hour work day (540minutes), the worker produces her/his wage in 378 minutes (6  hours 18 minutes) and works 162 minutes (2 hours 42 minutes) for free for Magna International.
  3. In an 10-hour work day (600 minutes), the worker produces her/his wage in 420 minutes (7  hours) and works 180 minutes (3 hours) for free for Magna International.
  4. In an 12-hour work day (720 minutes), the worker produces her/his wage in 503 minutes (8  hours  23 minutes) and works 217 minutes (3 hours 37 minutes) for free for Magna International.

Comparison of the 2019 Rate of Exploitation with the 2020 Rate of Exploitation

2020: So, with the adjustments in place: s=1081; v=2,509. The rate of exploitation or the rate of surplus value=s/v=1081/2,509=43%.
2019: So, with the adjustments in place: s=2,258; v=2,862. The rate of exploitation or the rate of surplus value=s/v=2,258/2,862=79%.

The absolute decrease in s is substantial: 1,177, and the rate of decrease is 52% (1081-2,258)/2,258=-1,177/2,258).

By contrast, the absolute decrease in v is much less: 353, and the rate of decrease is (2509-2862)/=2509=-353/2862=12%.

The substantial decrease in the rate of exploitation is likely due to the treatment of workers as “fixed costs” as the pandemic forced employers to retain workers despite the relatively extra costs associated with it (partly offset by federal, provincial and municipal supports).

There may, of course, be other causes of the decrease in the rate of exploitation, such as problems pertaining to supply of inputs, but I will leave that issue aside.

It should be emphasized that the exploitation of workers pertains to the production of a surplus beyond the production of the value equivalent of their own costs of production. Even during the time the workers require to produce their wage, they are oppressed by employers since they are subject to the will of the employer (or her representatives) and to the control over their labour.

Political Considerations

The rapid decrease in the rate of exploitation of workers of Magna International with the onset of the pandemic will likely call for an opposite pressure to increase exploitation directly through intensification and an extension of the working day and changes in technology and organization of the production process. Pressures to increase tax breaks for such capitalist employers (and corresponding reduction in state expenditures for welfare measures) may also arise. Of course, some workers will not just lay down and accept such counter-pressures.

Why is it that workers have to put up with this situation? Should they not be organizing not only to resist exploitation and oppression and increased pressures related to those phenomena but also to abolish such pressures? Not according to the social-democratic or social-reformist left. Such organizational efforts, for them, are undoubtedly unrealistic. New structures are supposedly to arise without criticizing the old structures.

Thus, for social democrats like Sam Gindin (former research director for the Canadian Auto Workers (CAW) (now Unifor), challenging the ideology of “decent jobs or work,” “fair contract,” “fair collective agreement,” “fair deal,” “fair wages” and other abstract phrases (rhetoric) is relatively unimportant. New material structures more relevant to the lives and experiences of working people are somehow to arise without constantly challenging the existing social structures–and the corresponding ideology that justifies such structures.

Frankly, I doubt that such new material structures will arise without a persistent and constant challenging of the ideological rhetoric rampant among the left in general and unions in particular.

I will include a rather long quote from a previous post. It is a conversation between Sam Gindin (a self-claimed “leader” of radical workers here in Toronto despite his probable own explicit denial of such a title) and me:

Re: A Good or Decent Job and a Fair Deal
Sam Gindin
Sat 2017-02-18 8:05 AM
Something is missing here. No-one on this list is denying that language doesn’t reflect material realities (the language we use reflects the balance of forces) or that it is irrelevant in the struggle for material effects (the language of middle class vs working class matter And no one is questioning whether unions are generally sectional as opposed to class organizations or whether having a job or ‘decent’ pay is enough. The question is the autonomy you give to language.

The problem isn’t that workers refer to ‘fair pay’ but the reality of their limited options. Language is NOT the key doc changing this though it clearly plays a role. That role is however only important when it is linked to actual struggles – to material cents not just discourse. The reason we have such difficulties in doing education has to do with the limits of words alone even if words are indeed essential to struggles. Words help workers grasp the implications of struggles, defeats, and the partial victories we have under capitalism (no other victories as you say, are possible under capitalism).

So when workers end a strike with the gains they hoped for going in, we can tell them they are still exploited. But if that is all we do, what then? We can – as I know you’d do – not put it so bluntly (because the context and not just the words matter). that emphasize that they showed that solidarity matters but we’re still short of the fuller life we deserve and should aspire to and that this is only possible through a larger struggle, but then we need to be able to point to HOW to do this. Otherwise we are only moralizing. That is to say, it is the ideas behind the words and the recognition of the need for larger structures to fight through that primarily matter. Words help with this and so are important but exaggerating their role can be as dangerous as ignoring it.

What I’m trying to say is that people do, I think, agree with the point you started with – we need to remind ourselves of the limits of, for example, achieving ‘fair wages’. But the stark way you criticize using that word, as opposed to asking how do we accept the reality out there and move people to larger class understandings – of which language is an important part – seems to have thrown the discussion off kilter.

On Sat, Feb 18, 2017 at 7:00 AM, Frederick Harris <arbeit67@hotmail.com> wrote:

I was waiting to see whether there was any dispute concerning either the primary function of language or its material nature. Since there has been no response to that issue, I will assume that the view that the primary function of language is to coordinate social activity has been accepted.

What are some of the political implications of such a view of language? Firstly, the view that “But material conditions matter more” has no obvious basis. If language coordinates our activity, surely workers need language “to reproduce themselves.”

The question is whether coordination is to be on a narrower or wider basis.

Let us now take a look at the view that a contract (a collective agreement) is fair or just and that what workers are striving for is a decent or good job.

If we do not oppose the view that any collective agreement is fair to workers and that the jobs that they have or striving to have are decent jobs, then are we saying that a particular struggle against a particular employer can, in some meaningful sense, result in a contract that workers are to abide by out of some sense of fairness? Does not such a view fragment workers by implicitly arguing that they can, by coordinating their action at the local or micro level, achieve a fair contract and a good job?

If, on the other hand, we argue against the view that the workers who are fighting against a particular employer cannot achieve any fair contract or a decent job, but rather that they can only achieve this in opposition to a class of employers and in coordination with other workers in many other domains (in other industries that produce the means of consumption of workers, in industries that produce the machines and the raw material that go into the factory, in schools where teachers teach our children and so forth), then there opens up the horizon for a broader approach for coordinating activity rather than the narrow view of considering it possible to achieve not a fair contract and a decent job in relation to a particular employer.

In other words, it is a difference between a one-sided, micro point of view and a class point of view.

As far as gaining things within capitalism, of course it is necessary to fight against your immediate employer, in solidarity with your immediate fellow workers, in order to achieve anything. I already argued this in relation to the issue of health in another post.

Is our standard for coordinating our activity to be limited to our immediate relation to an employer? Or is to expand to include our relation to the conditions for the ‘workers to reproduce themselves’?

“They turn more radical when it becomes clear that the system can’t meet their needs and other forms of action become necessary -”

How does it become clear to workers when their relations to each other as workers occurs through the market system? Where the products of their own labour are used against them to oppress and exploit them? Are we supposed to wait until “the system can’t meet their needs”? In what sense?

I for one have needed to live a decent life–not to have a decent job working for an employer or for others to be working for employers. I for one have needed to live a dignified life–not a life where I am used for the benefit of employers. Do not other workers have the same need? Is that need being met now? If not, should we not bring up the issue at every occasion? Can any collective agreement with an employer realize that need?

Where is a vision that provides guidance towards a common goal? A “fair contract”? A “decent” job? Is this a class vision that permits the coordination of workers’ activities across industries and work sites? Or a limited vision that reproduces the segmentation and fragmentation of the working class?

Fred

I guess workers’ explicit consciousness of their own exploitation and oppression and their discussion of such experiences is to arise only after the emergence of “larger structures to fight through.” It is, however, likely that such “larger structures” will simply mimic the “narrower” structures if both are not criticized. How is the CLC (the Canadian Labour Congress)  substantially different from union structures in terms of challenging the class power of employers? Or is Mr. Gindin referring to the larger structures, such as the class power of employers?

My own experience with union reps has been that they assume the necessity and legitimacy of the class power of employers–and do not do anything to raise the issue of the legitimacy of the class power of employers, the exploitation of workers and their oppression among their own members; their aim is to improve the working conditions without questioning at all such class power, exploitation and oppression. I have been a union member, a union rep (union steward and member of a collective-bargaining committee), a member of the executive of a union and a rep for an Equity and Social Justice Committee. I have seen up close the assumptions and limitations and unions–and have tried to address such limitations when and where I could.

The false nature of Mr. Gindin’s political position stands out when he claims the following:

Which brings me back to the point that the problem is not [Wayne] Dealy [union director for the Canadian Union of Public Employees (CUPE) Local 3902] or Sean [Smith,  Unifor Local 2002 Co-Ordinator and Toronto Airport Workers Council (TAWC) activist”] or others but OUR Collective inability to provide them with an effective alternative politics…They can be criticized but only if we do so with humility and part of criticizing ourselves. [my emphasis] 

Is there evidence that Mr. Gindin criticizes his own views? Are union reps (and union members) really conscious of the exploitative and oppressive nature of the class power of employers as such? If so, what are they doing about it? I fail to see evidence of it. I also fail to see evidence of Mr. Gindin engaging in self-criticism. He implicitly assumes that he knows what workers need–and that is not an explicit and real consciousness of their exploitation and oppression–with or without unions, collective bargaining and collective agreements

Let us look at an Integram Bargaining Report produced by Unifor Local 444 (Integram is a division of Magna International), dated November 8, 2020 (see  https://d3n8a8pro7vhmx.cloudfront.net/uniforlocal444/pages/43/attachments/original/1604838387/Integram_Ratification_Bulletin.pdf?1604838387).

It contains such enlightening items as the following:

Our members are their most vital asset that sets the supplier bar in this industry and deserves proper compensation through pay and benefits that award them for their labour and aids the company in retaining their highly skilled workforce. [my emphasis]

I find this language both typical of union reps–and disturbing. As I pointed out above, it is likely that Magna International treated the workers as a “fixed cost” in order to retain them during the worst moments of the pandemic. However, to read a union rep write that Magna workers are “an asset” surely is both disturbing and in need of criticism. Should any human being be considered and treated as an “asset?” Consider any member of your family. Would you want them to be treated as “an asset?”

That they are “assets” is real enough–to be exploited by Magna International (and all other private companies)–but should we not be criticizing this? Is Mr. Gindin in any specific way? Apparently not–since radicals are supposed to only criticize such views in “material cents.” Perhaps Mr. Gindin can provide an example of this in his own concrete practice? I see no concrete examples of his recommendations–they are so vague.

Where is Mr. Gindin’s “humility?” Where is his “self-criticism?”

Let us continue with this Integram Bargaining Report:

deserves proper compensation through pay and benefits that award them for their labour

This is ideology frequently expressed by union reps. “Proper compensation” is a synonym for “fair wages” and, indirectly, a “fair contract.” The union rep clings to the appearance of workers selling their “labour” [labour is an activity that requires a material link between that labour and the means to be used–without those means, there is only a capacity for labour or labour-power. As Marx remarked, in Capital: A Critique of Political Economy, volume 1, page 277:

When we speak of capacity for labour, we do not speak of labour, any more than we
speak of digestion when we speak of capacity for digestion. As is well known, the latter process requires something more than a good stomach.

Workers lack the conditions for the realization of their capacity for labour–just as many in the world lack the conditions for the use of their digestive tract–they lack food. The Unifor union rep., by identifying labour with the commodity which the worker sells, simply ignores the difference between a capacity and the conditions for its exercise–and such neglect of the conditions is hardly in the interests of workers.

How workers sell “labour” that is already linked to the means of production owned by (Magna) Integram (and hence under the control of Integram is a mystery. Furthermore, by identifying compensation with labour, the exploitation of workers by Magna Integram is excluded, and the internal or necessary relation between the wage and the profit of Magna Integram becomes broken.

Does Mr. Gindin criticize this approach so typical of union reps? Not at all. Rather, he criticizes those who engage in such criticism. For him, radicals are to indulge such beliefs. After all, it is only “discourse” and has no “autonomy.” This dismissal of ideological struggles is itself arrogant and lacks humility. Mr. Gindin somehow knows what workers need without even considering in any detail how union reps aid to legitimate the existing class power of employers by constantly using such language.

Where has Wayne Dealy provided any criticism of collective agreements (not the particular provisions of collective agreements) publicly? Sean Smith? Frankly, I find it astounding that such arrogance displayed by Mr. Gindin in his assumption that we are not to engage in criticism of union reps’ views is paraded as “humility” and “self-criticism.”

Let us listen to what Mr. Gindin called “Our Tracy” (McMaster, a union steward for Local 561 of the Ontario Public Service Employees Union (OPSEU); who was also vice-president of the local union at one point):

Collective bargaining is limited and imperfect, but a fuck-ton better than none.

I have hardly denied that collective bargaining is better than none. I have belonged to several unions in my life, and I certainly would prefer to belong to a union when working for an employer than not belonging to one. However, I do not take seriously her claim that “Collective bargaining is limited and imperfect.” I see no evidence that Ms. McMaster takes such a view seriously. Where is the evidence that she has inquired into “the limitations and imperfections” of collective bargaining? Rather, for Ms. McMaster, collective bargaining provides an imperfect but ultimately fair contract.

Perhaps Mr. Gindin can provide evidence to the contrary it. I doubt that he will–or can.

Mr. Gindin’s tactics are as follows: Let us try to convince such union reps of our views. Frankly, I think such an effort is, for the most part, a waste of time. Of course, there are exceptions, and it is necessary to use one’s judgement under specific circumstances and in relation to specific union reps. However, my judgement was and is that it Ms. McMaster would never be really convinced of the “limitations and imperfections” of collective bargaining.

Rather than indulging such union reps, it is in the interests of workers to criticize them and to expose their lack of a critical approach to collective bargaining.

Let us continue to look at this Bargaining Report:

Your bargaining committee achieved Pay Raises, Benefits Improvements, Lowering the new higher grid, Buy-out packages, and Signing Bonus. A healthy contract that reflects a greater worth in our Integram members.

Such achievements, of course, are in the interests of the workers. But why call it a “healthy contract?” Apparently, this is a synonym for a “fair contract”–and I have shown that Canadian unions persistently use such language to justify both the collective-bargaining process and collective agreements (see, for example,   Fair Contracts (or Fair Collective Agreements): The Ideological Rhetoric of Canadian Unions, Part One: The Canadian Union of Public Employees (CUPE)  or Fair Contracts or Collective Agreements: The Ideological Rhetoric of Canadian Unions, Part Three: Unifor (Largest Private Union in Canada)). No collective agreement can express something legitimate–unless the necessary exploitation and oppression of workers by employers (including Magna Integram) is somehow legitimate.

In the Bargaining Report, there then follows a list of items that were obtained by the bargaining committee. Not one word of the “limited and imperfect” nature of the collective agreement or the collective-bargaining process. Not one word on the management rights clause, implicit or explicit in the collective agreement. Do not workers persistently experience the power of management in a variety of ways? Why the silence over such experiences? Does the collective agreement address such power? Or does it only address the limited areas defined by collective-bargaining legislation?

For Mr. Gindin, though, to question the “language” used by union reps, as well as the omission of any criticism of the limitations of collective bargaining and collective agreements, expresses merely “moralizing.”

I will leave Mr. Gindin with his fake humility and his fake self-criticism. I will continue to engage in “discourse analysis”–that is to say, with a criticism and exposure of the limited nature of unions, collective bargaining and collective agreements.

Data on Which the Calculation Is Based

The calculation of the rate of exploitation is undoubtedly imperfect, and I invite the reader to correct its gaps. Nonetheless, the lack of any attempt to determine the rate of exploitation at the city level has undoubtedly reinforced social-reformist tendencies.

Now, the calculation:

In millions US dollars:

Sales $32,647
Costs and expenses $31,641

Cost of goods sold 28,207

Material $19,750
Direct labour 2,498
Overhead 5,959

Depreciation and amortization 1,366
Selling, general & administrative 1,587
Interest expense, net 86
Equity income (189)
Other expense, net 584
Income from operations before income taxes $1,006

[28,207+1,366+1,587+86+584=31,830; 31,830+1006=32,836; 32,836-189=32,647]

Adjustments

As I indicated in the 2019 post, a couple of adjustments are necessary.

Adjustment on Cost Side of Direct Labour and Corresponding Adjustment of Income  from Operations Before Taxes

I wrote in the 2019 post:

On page 37 [of the 2019 annual report], there is a reference to pension benefits. I assume that this category belongs to “direct labour” since it forms part of the deferred wages of workers that is paid in the current year (but then again, it is unclear whether the category of direct labour includes this, but since it is subtracted from net income, this leads me to believe that it is not included in that category). This should be added to direct labour. Hence, direct labour would be: 2,815+47=2,862, “Costs and expenses” would be $37, 255 “Costs of goods sold”would be $34,069, and “Income from operations before taxes” should be adjusted downward accordingly.

Now the 2020 “Pension and post-retirement benefits” is  (11).

This US $11 million should be added to “Cost and Expenses,” “Direct labour” and subtracted from “Income from operations before taxes.” Accordingly:

Temporarily Adjusted Costs and Expenses: $31,652
Temporary Adjusted Costs of Goods Sold: $28,218
Adjusted Direct Labour Costs: $2,509
Temporarily Adjusted income from operations before income taxes: $995

Adjustment of income from operations before income taxes due to interest expense, net

Another adjustment relates to interest. As I indicated in my post about the 2019 rate of exploitation of workers at Magna International:

An adjustment should probably be the treatment of the payment of interest: despite being an expense from the point of view of the individual capitalist, it probably forms part of the surplus value. It should be added to “Income before income tax expense.”

Accordingly, it is necessary to add $86 “Interest expense, net” to “Income from operations before income taxes” and subtract it from “Cost and expenses.”

(“Equity income” is already subtracted from costs since it is not really a cost at all but rather income.)

Adjusted Cost and Expenses $31,566
Adjusted Direct Labour $2,509
Adjusted income from operations before income taxes $1081

The Rate of Exploitation

So, with the adjustments in place: s=1081; v=2,509. The rate of exploitation or the rate of surplus value=s/v=1081/2,509=43%.

I will first consider this rate in relation to the workers in 2020, and then compare this rate with the 2019 rate of exploitation.

That means that for every hour worked that produces her/his wage, a worker at Magna International works around an additional 26 minutes for free for Magna International. Alternatively, in terms of money, $1 of wage or salary of a regular Magna International worker produces around $0.43 (43 cents) surplus value or profit for free.

The following provides information about the length of the working day:

  1. There are 3 shifts. 9 hours a shift.
  2. Typical 8 – 12 hours per shift.
  3. 8-12 hrs, 7 days a week, with very last minute overtime mandating, and i mean literally as your punching out theyll tell you that you have to stay for another 4+ hours. No work life balance and management could care less because theyre at home on the weekends. Better positions come with 100% more stress, more responsibilities that others pass off cause they dont want to do it, 1000s of strings attached and literally no way to avoid getting screwed by them. Constant harassment and belittling by management and engineers and if you report it, youre facing constant retaliation and impending termination. If your not part of the HR posse or the “good ol’ boys club”, youre nothing but a rug for them to walk across. So, if you value your sanity, health and family, this is not a place to work.
  4. I have been there for 3 years until i quit and half of the plant is doing either 10 or 12 hours 7 days a week
  5. Article 17 (page 51) of the collective agreement between Magna International and Unifor Local 2009AP: Employees normally work an eight-hour day, five days per week

Accordingly:

  1. In an 8-hour work day (480minutes), the worker produces her/his wage in 336 minutes (5 hours  36 minutes) and works 144 minutes (2 hours 24 minutes) for free for Magna International.
  2. In an 9-hour work day (540minutes), the worker produces her/his wage in 378 minutes (6  hours 18 minutes) and works 162 minutes (2 hours 42 minutes) for free for Magna International.
  3. In an 10-hour work day (600 minutes), the worker produces her/his wage in 420 minutes (7  hours) and works 180 minutes (3 hours) for free for Magna International.
  4. In an 12-hour work day (720 minutes), the worker produces her/his wage in 503 minutes (8  hours  23 minutes) and works 217 minutes (3 hours 37 minutes) for free for Magna International.

Comparison of the 2019 Rate of Exploitation with the 2020 Rate of Exploitation

2020: So, with the adjustments in place: s=1081; v=2,509. The rate of exploitation or the rate of surplus value=s/v=1081/2,509=43%.
2019: So, with the adjustments in place: s=2,258; v=2,862. The rate of exploitation or the rate of surplus value=s/v=2,258/2,862=79%.

The absolute decrease in s is substantial: 1,177, and the rate of decrease is 52% (1081-2,258)/2,258=-1,177/2,258).

By contrast, the absolute decrease in v is much less: 353, and the rate of decrease is (2509-2862)/=2509=-353/2862=12%.

Factors or Determinants of the Rate of Exploitation and Its Changes

Normally, when there is a change in the rate of exploitation, whether positive or negative, we should look at the general factors that govern the production of surplus value.  In general, there are three ways of changing the rate of exploitation:

  1. changing the real wage (the absolute amount and variety of commodities consumed by workers);
  2. changing the absolute amount of surplus value produced either by
    1. changing the length of the working day intensity of labour or
    2. changing the intensity of labour length of the working day
  3. changing (in fact, increasing) the relative amount of surplus value produced, generally through new technology, thereby decreasing the value of the commodities produced that form the real wage consumed by workers (with a fixed or constant working day and a constant amount of commodities consumed by workers, but with less labour time required to produce them, the amount of labour time required to reproduce the workers’ wages is reduced and more labour time constitutes surplus value).

As Ben Fine  and Alfredo Saad-Filho (2016) describe the factors with a view to increasing the rate of exploitation by employers in their book Marx’s Capital, pages 36-37:

Assume, now, that real wages remain unchanged. The rate of exploitation can be increased
in two ways….

First, e [the rate of exploitation[ can be increased through what Marx calls the production of absolute surplus value. On the basis of existing methods of production – that is, with commodity values remaining the same – the simplest way to do this is through the extension of the working day. …

There are other ways of producing absolute surplus value. For example, if work becomes more intense during a given working day, more labour will be performed in the same period, and absolute surplus value will be produced. The same result can be achieved through making work continuous, without breaks even for rest and refreshment. The production of absolute surplus value is often a by-product of technical change, because the
introduction of new machines, such as conveyors and, later, robots in the production line, also allows for the reorganisation of the labour process. This offers an excuse for the elimination of breaks or ‘pores’ in the working day that are sources of inefficiency for
the capitalists and, simultaneously, leads to increased control over the labour process (as well as greater labour intensity) and higher profitability, independently of the value changes brought about by the new machinery.

The desired pace of work could also be obtained through a crudely applied discipline. There may be constant supervision by middle management and penalties, even dismissal, or rewards for harder work (i.e. producing more value).

The above are general conditions for the determination of the rate of exploitation and its changes. The specific change observed in the rate of exploitation of workers at Magna International are unlikely due to these general conditions. Rather, the decrease in the rate of exploitation in 2020 relative to 2019 is likely due to the specific economic conditions that accompanied the pandemic.

One Possible Explanation for the Substantial Decrease in the Rate of Exploitation

Part of the explanation for the  substantial decrease in the rate of exploitation was probably the treatment of workers at Magna International, in part, as “fixed costs.”

Initially, Magna International laid off many of “its” workers, but it also sought to retain them by paying them additional money beyond that flowing from the government initially through federal  unemployment insurance (although it may have also been a function of provisions in the collective agreement concerning layoffs).

Magna International did lay off around 2,000 workers in Ontario during the initial wave of COVID. From https://lfpress.com/business/local-business/magna-cuts-production-2000-local-staff-amid-fallout-from-covid-19:

Magna cuts production, 2,000 local staff amid fallout from COVID-19

Magna, one of the largest automotive employers in the London region, has laid off about 2,000 workers locally as the fallout from the COVID-19 pandemic sweeps through the manufacturing sector.

Article content

Magna, one of the largest automotive employers in the London region, has laid off about 2,000 workers locally as the fallout from the COVID-19 pandemic sweeps through the manufacturing sector.

The Canadian auto parts giant has closed its two St. Thomas plants, Presstran and Formet, employing a combined 1,500 to 2,000, as well as Qualtech in London, which employs about 275.

“Both Formet and Presstran will be temporarily suspending operations today . . . Qualtech will also temporarily suspend its operations,” read a statement from Scott Worden of Magna’s corporate communications department.

“Magna is committed to both the health and financial well-being of our employees. We will be providing additional payments to employees beyond the minimums provided under the federal Employment Insurance program.”

The closings are not unexpected, and may not last long, as the Detroit Three automakers, Toyota and Honda have all closed plants for up to two weeks across North America as a result of the coronavirus.

Presstran is a stamping plant and Formet supplies several different parts to many automakers, including truck frames to GM plants in the U.S. Qualtech supplies seating systems.

“Magna continues to closely monitor developments related to coronavirus (COVID-19) with a focus on the health and safety of our employees and our operations. In addition, we are in daily communication with our customers, many of which have recently announced partial or full temporary production suspensions at plants in Europe and North America,” read an additional statement from Tracy Fuerst, vice-president of corporate communications at Magna.

The automaker said it will continue to follow World Health Organization protocol on cleaning the workplace and limiting contact with between people.

“We continue to assess our operations on an individual basis and are beginning to temporarily suspend manufacturing operations at a number of our manufacturing divisions around the world . . . many of our facilities are expected to suspend operations with production status re-evaluated week to week,” said Fuerst.

Further evidence for treating Magna International workers as fixed costs comes from Annual Information Form, Magna International Inc., March 25, 2021, page A-17:

Despite inevitable temporary layoffs of employees in light of the suspension of production during the first half of 2020, we took a number of steps to minimize the impact felt by our employees, including: maintaining employee benefits coverages through the temporary layoff period; …

We also engaged emergency government support programs primarily for employees to maintain compensation levels and/or benefits for a certain period, where applicable. The countries in which Magna engaged such programs included Canada, the United States, the United Kingdom, Germany, Austria and China. These programs allowed participating employees to remain on our payroll while inactive or furloughed due to mandatory stay at home orders, with Magna receiving full or partial reimbursement for such inactive labour.

The view that workers were treated more as fixed costs (probably out of fear that Magna International would lose such workers to other employers if they were not treated as fixed costs) is supported by the relatively limited decrease in v when compared to s.

Treating workers as “fixed costs” under the conditions of the pandemic is understandable since workers are not linked politically or legally to particular employers; they can work for another employer (if they can find another employer who will hire them). See Do Workers Work for a Particular Employer or for the Class of Employers? Part One: A Limitation of Some Radical Left Critiques of Capitalist Relations of Production and Exchange (A.K.A. Capitalism) and  Do Workers Work for a Particular Employer or for the Class of Employers? Part Two: Critique of Unions and the Social-Reformist or Social-Democratic Left).

This treatment of workers as fixed costs (to retain them over the short term) and the resulting decrease in the rate of exploitation is consistent with abnormal conditions that capitalist employers generally try to avoid since, on the one hand, they own means of production (c) that fail to absorb surplus value and, hire relatively more workers (v) than can be exploited under given conditions. From Karl Marx, Capital: A Critique of Political Economy. Volume 2, The Process of , page 111:

The point is simply that under all circumstances the part of the money that is spent on means of production – the means of production bought in M-mp [money used to purchase means of production, such as computers and other machines, raw material, buildings and other produced commodities necessary for labour to be performed] means of production – must be sufficient, i.e. must be reckoned up from the start and be provided in appropriate proportions. To put it another way, the means of production must be sufficient in mass to absorb the mass of labour which is to be turned into products through them. If sufficient means of production are not present, then the surplus lahour which the purchaser has at his disposal cannot be made use of; his right, to dispose of it will lead to nothing. If more means of production are available than disposable labour, then these remain unsaturated with labour, and are not transformed into products.

In effect, in terms of the pandemic, Magna International purchased too much labour power (the capacity to use the means of production and to produce value–a capacity sold by workers) and too many means of production. Not all of the labour power purchased could be exploited, and not all the means of production owned by Magna International could absorb labour and hence surplus labour and surplus value.

There may, of course, be other causes of the decrease in the rate of exploitation, such as problems pertaining to supply of inputs, but I will leave that issue aside.

It should be emphasized that the exploitation of workers pertains to the production of a surplus beyond the production of the value equivalent of their own costs of production. Even during the time the workers require to produce their wage, they are oppressed by employers since they are subject to the will of the employer (or her representatives) and to the control over their labour.

Conclusion

The rapid decrease in the rate of exploitation of workers of Magna International with the onset of the pandemic is likely due to the temporary) overinvestment in the purchase of labour power relative to the inability of management to use the means of production to exploit the workers. This situation will likely now call for an opposite pressure to increase exploitation directly through intensification and an extension of the working day and changes in technology and organization of the production process. Pressures to increase tax breaks for such capitalist employers (and corresponding reduction in state expenditures for welfare measures) may also arise. Of course, some workers will not just lay down and accept such counter-pressures.

Why is it that workers have to put up with this situation? Should they not be organizing not only to resist exploitation and oppression and increased pressures related to those phenomena but also to abolish such pressures? Not according to the social-democratic or social-reformist left. Such organizational efforts, for them, are undoubtedly unrealistic. New structures are supposedly to arise without criticizing the old structures.

Thus, for social democrats like Sam Gindin (former research director for the Canadian Auto Workers (CAW) (now Unifor), challenging the ideology of “decent jobs or work,” “fair contract,” “fair collective agreement,” “fair deal,” “fair wages” and other abstract phrases (rhetoric) is relatively unimportant. New material structures more relevant to the lives and experiences of working people are somehow to arise without constantly challenging the existing social structures–and the corresponding ideology that justifies such structures.

Frankly, I doubt that such new material structures will arise without a persistent and constant challenging of the ideological rhetoric rampant among the left in general and unions in particular.

Where is there evidence that Mr. Gindin has contributed to the creation of material structures that question the fundamental economic, political and social structures characteristic of a society dominated by a class power of employers by indulging in the beliefs of union reps? Does the organization Green Jobs Oshawa, to which Mr. Gindin contributes, do so? Where is the evidence that it does?

What are Mr. Gindin’s fellow social democrats like Herman Rosenfeld (who worked in the education department of the Canadian Auto Workers (CAW) (now Unifor) doing to fight against the exploitation of workers and oppression of Magna workers? Mr. Rosenfeld wrote an article, criticizing the existence, practically, of a company union at Magna, CAW Local 88, comparing it to the independent union Unifor Local 2009 AP. The independent union is certainly preferable to a company union, but even an independent union at the local level of a particular employer in effect assumes the legitimacy of the power of employers as a class (see my criticism in the post    Do Workers Work for a Particular Employer or for the Class of Employers? Part Two: Critique of Unions and the Social-Reformist or Social-Democratic Left).

The false nature of Mr. Gindin’s political position stands out when he claims the following:

Which brings me back to the point that the problem is not [Wayne] Dealy [union director for the Canadian Union of Public Employees (CUPE) Local 3902] or Sean [Smith,  Unifor Local 2002 Co-Ordinator and Toronto Airport Workers Council (TAWC) activist”] or others but OUR Collective inability to provide them with an effective alternative politics…They can be criticized but only if we do so with humility and part of criticizing ourselves. [my emphasis] 

Is there evidence that Mr. Gindin criticizes his own views? Are union reps (and union members) really conscious of the exploitative and oppressive nature of the class power of employers as such? If so, what are they doing about it? I fail to see evidence of it.

I also fail to see evidence of Mr. Gindin engaging in self-criticism. He implicitly assumes that he knows what workers need–and that is not an explicit and real consciousness of their exploitation and oppression–with or without unions, collective bargaining and collective agreements.

:

.

For Mr. Gindin, though, to question the “language” used by union reps, as well as the omission of any criticism of the limitations of collective bargaining and collective agreements, expresses merely “moralizing.”

I will leave Mr. Gindin with his fake humility and his fake self-criticism. I will continue to engage in “discourse analysis”–that is to say, with a criticism and exposure of the limited nature of unions, collective bargaining and collective agreements.

.

A Short List of the Largest Employers in Quebec According to the Number of Employees

The following is a list of the twenty-two largest companies in Quebec according to the number of employees for 2019. The silence of the social-democratic left concerning the power of these employers over the lives of employees reflects the incapacity of the social-democratic left to face up to the reality of most people’s lives these days. As I argued in another post (An Example of the Inadequacy of the Canadian Left, or How the Canadian Left Contributes to the Emergence of the Canadian Right), such disregard for the experiences of regular working people feeds into the development of right-wing attitudes.

The information is drawn from The Largest Private Employers in Quebec:

Company                                                                              Number of Employees in Quebec

  1. Metro                                                                           59,660

  2. Desjardins                                                                  40,868

  3. Sobeys                                                                         35,000

  4. George Weston                                                          27,500

  5. McDonald du Canada                                              20,000

  6. Hydro-Quebec                                                           19,904

  7. Banque Nationale                                                     15,981

  8. Walmart Canada                                                       15,000

  9. Bombardier                                                               14,500

  10. BCE                                                                              14,100

  11. GardaWorld                                                               13,500

  12. Le Coop federee                                                        10,294

  13. Societe de Transport de Montreal (STM)             10,029

  14. Lowe’s Canada                                                          10,000

  15. Quebecor                                                                    9,900

  16. St-Hubert (Groupe)                                                   9,300

  17. Alimentation Couche-Tard                                      8,500

  18. Costco (Les entrepots)                                              7,492

  19. Air Canada                                                                  7,477

  20. Banque Royale du Canada                                       7,000

  21. CGI                                                                                7,000

  22. Rio Tinto                                                                      7,000

Total Number of Employees: 370,005.

The average number of employees per employer in Quebec for these 22 companies is 16,818.

Does this situation express the freedom of workers? How many of those workers can direct their own lives at work? How many have their lives directed at work by a minority?

Certainly, workers are not forced directly to work for a specific employer, but ownership or rental of the conditions of work (buildings, chairs, desks, computers, photocopiers, printers and so forth) by these employers and the exclusion of such ownership by the workers indirectly obliges workers to work for an employer (though not a specific employer–although even then, given certain skills or lack of skills, workers must work for a specific employer within a specific group of workers. Thus, a worker with teaching skills will unlikely work as a flight attendant and hence can only work for certain employers.)

The relative–and restricted–freedom of workers to choose a particular employer has as its counterpart the much greater freedom of employers to choose whom they will hire. How many of you have gone to job interviews and felt the unequal power relations between you and the interviewer–even in a unionized setting? Why is that?

An Inadequate Critique of a Radical Basic Income: The Case of the Toronto Radical John Clarke, Part Three: Basic Income

Introduction

In two earlier posts, I criticized the views of the  radical activist here in Toronto, John Clarke (see  Critique of the Limited Aim (Solution)–Decent Wages–of a Radical Social Democrat: The Case of the Toronto Radical, John Clarke: Part One and   Critique of a Limited Definition of the Problem: The Case of the Toronto Radical John Clarke, Part Two). In particular, I criticized his proposed solution or aim in the first post (decent wages) and his identification of the problem in the second post (unequal distribution of produced consumer commodities). I now address his criticism of the proposal of a basic income. 

Let me add that, in the second post, I added an addendum, in which Mr. Clarke proposed engaging in radical practice to replace capitalism (a.k.a., the class power of employers). Mr. Clarke continues to advocate for more radical solutions. Thus, he wrote on Facebook (May 3, 2022): 

The murder of Rosa Luxemburg by social democratic leaders points to something about reformism. If you think capitalism can be incrementally transformed, you need it to function well. This means, at a time of crisis, you have to be prepared to defend it against the very working class you claim your political project will liberate.

In time, the logic of the reformist approach produces representatives who dispense with any polite fictions of socialism in the cloudy future and whose loyalty to capitalism is beyond question. They then go about breaking strikes, imposing austerity, degrading the environment and dropping bombs on oppressed countries with every bit as much enthusiasm as any openly declared representative of the capitalist class.

The problem with the above is not what it states, but in what it omits. Before Mr. Clarke’s more explicit radical turn, he advocated such reformist policies as “decent wages” and a reformed welfare state (despite acknowledging that economic coercion formed a necessary aspect of a society characterized by the class power of employers). Indeed, as I wrote in another post: 

I have already criticized, briefly, his apparent recognition of economic coercion and his subsequent ignoring of this recognition in a pamphlet with several articles written by him (see  Basic Income: A Critique of the Ontario Coalition Against Poverty’s Stance  and “Capitalism needs economic coercion for its job market to function” (Ontario Coalition Against Poverty: OCAP)). I have, however, now come to the conclusion that Mr. Clarke recognizes the existence of economic coercion only in order to criticize neoliberalism and not the class power of employers and hence not capitalism as such. 

Mr. Clarke, if he has indeed taken a more radical turn, would do well to engage in critical inquiry into his former beliefs. He should also rethink the thrust of his criticism of basic income in light of his more explicit rejection of capitalism. Of course, if he comes to the conclusion that basic income should still be rejected, but has an alternative proposal that would link immediate needs of workers, citizens, immigrants and migrant workers with the long-term need to abolish the class power of employers and the associated economic, political and social structures, and he provides valid reasons for his rejection, I would agree with him. Basic income as a policy is really only a tool or means to the end of economic coercion, and if there are better alternatives that will link immediate and long-term needs, then I would support them and reject basic income. 

Let us turn to Mr. Clarke’s views on basic income–at least before his more radical turn.

Mr. Clarke’s Critique of Basic Income

Mr. Clarke has this to say about basic income (see his post, dated June 21, 2021 https://www.youtube.com/watch?v=r40D6fU760s&t=4s) (The following is practically verbatim):

Part 2: Basic Income

Those among the left who support basic income make a fundamental mistake in that they don’t take into account the necessity of economic coercion that was outlined above. They imagine that basic income has some magic quality that would make it exempt from the factors that constitute economic coercion and that would prevent basic income from being realized. Furthermore, they believe that existing income-support systems fail to meet people’s needs because of some design flaw; they believe that only if income-support systems could be reorganized in a better way, it would meet people’s needs. But that is not what is driving the process that is making them inadequate.

The left make an unwarranted assumption that basic income would be more adequate–that it is somehow going to meet people’s needs that existing programs do not. It will somehow be exempt from the limitations that other income-support programs are not.

Some among the left point to the pilot project of basic income instituted by the former Liberal government in Ontario. It is true that the project provided levels of income significantly higher than current social assistance levels, but to assume that such a project, if generalized throughout Ontario, would maintain such levels, is unwarranted.

Another unwarranted assumption is that basic income would be better because it would be universal. Those among the left who advance this view are filled with false hopes since no program of basic income actually being considered in the real world has universal scope; it will be targeted, with only some people qualifying.

It is also suggested that the stigma attached to existing income-support systems would be reduced if basic income were introduced and therefore would be more popular and it would be harder for governments to cut it. Mr. Clarke disagree with this. If a basic income were introduced, it would be attacked and questioned in exactly the same way as existing programs. In addition, popularity even if it existed would not save it. Public health-care programs have been under attack and faced massive austerity cutbacks despite being vital, necessary and popular.

Another suggestion is that basic income would be an unconditional benefit. In practice, that is unlikely to be the case. Mr. Clarke, on the other hand, does agree that existing income-support programs are bureaucratically intrusive. They are fused with elements of moral policing. And these things do indeed need to be challenged.

It has also been suggested that basic income will happen and will save us from the workless future based on robots. This view that we are on the cusp of an automated life is exaggerated, and the real situation is much more nuanced than that. On the other hand, Mr. Clarke does not deny that technological displacement is not a real issue. What he does question is that basic income is the magic solution to that problem. Capitalism does not function by allocating a certain adequate fund owned by billionaires in Silicon Valley so that people can receive an adequate standard of living. Since the industrial revolution, capitalists have used the introduction of new machinery to gain a competitive edge over their rivals, to displace workers and to create a greater climate of desperation and to try to drive down wages and that’s the fight that we are going to be in. We are going to have to fight in this situation as workers have always fought against technological displacement. We are going to have to fight for reduced hours of work. We are going to have to take up a whole series of important struggles.

It must be said that only under an irrational, profit-driven greedy system is this an issue. The idea that technological gains, which increase the productivity of human labour, should be something that we should be alarmed about, is confined to this system. Why should not those productive gains be used to benefit everyone? Why do we not take the machines away from the capitalists and use them to everyone’s advantage?

Mr. Clarke then refers to the various pilot projects on basic income because this is a big selling point for people who promote basic income. In Ontario, as mentioned above, a pilot project in basic income was initiated under the Liberal government for 2000 people. It provided a higher level of income than social assistance, it was relatively secure until the Tories cut it. They did intensive studies to show that people were better off. The studies prove nothing. They were not studying basic income but rather poor people. Of course, it is obvious that if you increase the level of income, people’s health is better and, in general, people’s lives are better.

The question that needs to be posed is: What effect basic income would have if it were implemented across a larger area of a capitalist economy. Basic income takes us in directions that are very dangerous–directions that we should be fighting rather than embracing. Basic income is essentially a proposal for a massive extension of social provision by way of the cash benefit. Seventy percent of the people in the pilot project in Ontario were not on social assistance. What they were primarily looking at was a wage top-up system. So the idea of basic income is to extend the benefit to a wider proportion of the working population.

This situation entails the commodification of social provisions, and such commodification is enormously dangerous. What it does is have you accept the low-wage, precarious workforce. But you then allegedly take away the worst effects of it by taking tax revenues paid by other working-class people not just a wage top up to those workers but what is in effect a wage subsidy to low wage employers. This has the effect of removing pressure on such employers to increase wages. It undermines the efforts to raise minimum wages. It simply accepts the low-wage precarious workforce but tries to provide a kind of limited sedative. This is a major mistake.

Mr. Clarke also believes that by providing so much more in the form of a cash benefit, you would facilitate the agenda of austerity and privatization. This cash benefit would be used, in practice, to justify the further gutting of public services. This is why the right is so enamored with the idea of basic income. Both eff Bezos and Milton Friedman favoured a basic income, and the Canadian Chamber of Commerce favours a national pilot project on basic income. Friedman n particular argued that unions, minimum wages and social programs were all monstrous totalitarian interferences in the freedom of the marketplace. On the other hand, he recognized that pure capitalism without limits could be counterproductive. Consequently, what was necessary was the provision of a basic income at a minimum level, without any other social support system in place. The American right-winger Charles Murray has developed this further as has the Canadian right-wing institute the Fraser Institute. Murray advocates providing a minimum basic income that does not interfere with the flow of low-wage workers but that at the same time prevents social breakdown. Basic income for Murray is not to supplement and augment existing social provisions but rather replaces them.

Focusing on basic income enables the right to divert attention from the gross inadequacy of existing income-support systems. Basic income as a social policy would thus take us to playing the game of the right in the context of a capitalist economy and especially at this time, with the present balance of forces in society.

The counterargument by progressives on the left, of course, is that that is not their vision–that that is not the kind of basic income that they want. They want other systems to be strengthened; they want good minimum wages. The problem with that is that it does not take into account the prevailing situation. It does not take into account the present balance of forces. It does not take into account the agenda of capitalism. It assumes somehow that a wish will get you there. The kind of basic income that comes into existence would be shaped by the prevailing situation. If you assume that what you want or imagine can be realized, then you can create any number of utopias. Some people claim that universal basic income could be provided at such a level that they can literally decide whether they can participate in the job market or not. Where the money is to come from, and who is to provide it is unclear.

But as Pam Frache, from Toronto’s Workers Action Centre put it so well, to expect the capitalist state to provide the working class with an unlimited strike fund is an absurdity. And to suggest at this point in time, after forty years of defeat at the hands of neoliberal attack, that we’re in a position to win even a fraction of that is preposterous. Someone the other day stated that Mr. Clarke’s arguments were wrong because his version of basic income would be universal; it must be adequate; and it must be financed entirely by attacks on wealth. Of course, you can demand that the sky rain whiskey, but it’s just not going to happen. It is not realistic. Philippe van Parijs, Belgian advocate of basic income, has even suggested that basic income could even transform, could transform society, could abolish capitalism. Of course, if wishes were horses we could bet on basic income. However, we have to deal with reality. At the moment, it constitutes a very dangerous and distracting leftist illusion.

The New Democratic Party (NDP) [the social-democratic party here in Canada) are making a lot of effort in trying to win a basic income. Mr. Clarke is sad to say that some union leaders are buying into the idea. Social movements are backing it. Even a section of the anti-capitalist left is embracing basic income in this situation. It poses sometimes as a very transformative, radical bold proposal, but Mr. Clarke believes that it makes its peace with the capitalist marketplace and the neoliberal order. It says: wages will remain low, but it will be topped up by the tax revenues. This is a mistaken direction.

The Potentiality of Radical Proposals, Such as a Robust Basic Income, to Point Beyond a Society Dominated by a Class of Employers

It should be noticed that Mr. Clarke’s soul reference to what could be considered a radical aim that points beyond a society dominated by a class of employers is an isolated reference that Mr. Clarke fails to integrate in any way with his proposal for an enhanced welfare state. Thus, he states above: 

Why do we not take the machines away from the capitalists and use them to everyone’s advantage?

Yes, indeed, why do we not do that? How would we do that? By only enhancing the welfare state? How does only enhancing the welfare state contribute to that goal or aim? Mr. Clarke’s question is actually purely rhetorical. It serves no purpose that would enable workers to organize themselves in the present to realize that goal–an internal aim. Mr. Clarke’s aim of enhancing the welfare state is the primary focus; the reference to taking “the machines away from the capitalists and using them to everyone’s advantage” is not linked in any way to that focus. 

Could proposing a radical basic income that points beyond a market for workers by involving  a robust or enhanced or thick basic income that increases the freedom of workers from economic coercion be a stepping stone to the goal of taking “the machines away from the capitalists and using the to everyone’s advantage?” 

Of course, I fully admit that a basic income can be used for conservative purposes, for social-democratic purposes or for socialist purposes–just as can a proposal for welfare reform. It is to what basic income is linked that determines its conservative, social-democratic or socialist nature and not the proposal itself. Mr. Clarke, however, cannot admit that because his goal is decidedly reformist despite his radical rhetoric to the contrary. 

Consider Philippe Van Parijs and Yannick Vanderborgh’s (2017) view in Basic Income: A Radical Proposal for a Free Society and a Sane Economy, page 124: 

There is, however, no reason why one should wait until full abundance to start realizing partially the distributive principle that defines communism. Indeed, if it turns out—in light of historical experience and for deep-seated reasons to which Marx paid insufficient attention—that capitalism does better than socialism at developing the forces of production, this gradual transition to communism could happen in the context of a capitalist economy. The proposal of an unconditional basic income makes a lot of sense in this perspective. While not yet in a state of abundance, our society may plausibly be regarded as affluent in the sense that it could cover everyone’s fundamental needs unconditionally with a basic income, topped up in some cases to address special needs such as disabilities

This sounds fine, but I agree with Mr. Clarke that it is likely utopian–but not for Mr. Clarke’s reason that it is unrealizable. A robust basic income would interfere in the market for workers. Even if the resistance of employers were overcome–a big if–the working of the capitalist economy would be distorted substantially, leading to breakdowns in the accumulation process of capital and could be a threat to other workers–unless further measures were introduced. Thus, if a robust basic income were in place, it is likely that productivity of labour would initially decrease as economic coercion became less effective; absenteeism and other measures that entail the avoidance of work (understandable given the dictatorial nature of such work–see for example my post  Employers as Dictators, Part One) would also likely rise. For example, resistance by workers to work certainly characterized some sections of the working class during Michael Seidman (1991), Workers Against Work: Labor in Paris and Barcelona During the Popular Fronts, page 9: 

Furthermore, I wish to bring out the utopian dimension of resistance, a word which I have chosen because of its positive connotations. The importance of resistance in two major European cities in the fourth decade of the twentieth century indicates that refusals of work should not be dismissed as the behavior of “backward” or “primitive” working classes. Certainly, resisters did not articulate any clear future vision of the workplace or of society. Unlike the Marxists, they did not fight to take state power or, in contrast to the anarchosyndicalists, abolish or minimize the role of the state. I do not wish to
ignore the fact that workers’ refusals to work harmed the fight against Franco and weakened French defenses in a period of Nazi rearmament. Yet one might interpret resistance itself as suggesting a working-class utopia in which wage labor would be reduced to a minimum. Resistance was also a conjunctural and cyclical phenomenon, but refusals remained an intrinsic part of working-class culture and manifested themselves in different periods with various divisions of labor. During the Popular Fronts, workers revolted against a variety of disciplines, including that imposed by working-class organizations. Wage earners certainly wished to control their workplaces but generally in order to work less. One may speculate that the way to eliminate resistance is not by workers’ control of the means of production but rather by the abolition of wage labor itself.

The idealization of work in its present form meets the resistance of workers in various ways. Marx recognized this. From Marx-Engels Collected Works, 1843-1844, “Economic and Philosophic Manuscripts of 1844, Estranged Labour,” page 274: 

What, then, constitutes the alienation of labour? First, the fact that labour is external to the worker, i.e., it does not belong to his intrinsic nature; that in his work, therefore, he does not affirm himself but denies himself, does not feel content but unhappy, does not develop freely his physical and mental energy but mortifies his body and ruins his mind. The worker therefore only feels himself outside his work, and in his work feels outside himself. He feels at home when he is not working, and when he is working he does not feel at home. His labour is therefore not voluntary, but coerced; it is forced labour. It is therefore not the satisfaction of a need; it is merely a means to satisfy needs external to it. Its alien character emerges clearly in the fact that as soon as no physical or other compulsion exists, labour is shunned like the plague. External labour, labour in which man alienates himself, is a labour of self-sacrifice, of mortification. Lastly, the external character of labour for the worker appears in the fact that it is not his own, but someone else’s, that it does not belong to him, that in it he belongs, not to himself, but to another.

If a robust basic income were implemented, it would interfere with the accumulation of capital, leading to the emergence of problems that would require further measures that would involve further interference in the process of the accumulation of capital. It would be better to be conscious of such a possibility and the need for a conscious movement that aimed to abolish wage labour–rather than enhancing the welfare state (itself still grounded on wage labour) or in a reversion to a neoliberal paradise.

Mr. Clarke’s implicit assumption that it is utopian to propose a robust or enhanced basic income, given economic coercion, is a conservative stance. It uses a radical view–that economic coercion is a fact of life in a society dominated by a class of employers–to draw conservative (social-reformist) conclusions. The same method was used by Mr. Bush in his one-sided use of Marx’s theory of surplus value (see Basic Income: A Critique of the Social-Reformist Left’s Assumptions and Analysis: Part Two and  Social-Reformist Leftist Activists Share Assumptions with the Right).

Mr. Clarke’s Inconsistent Call for Class Struggle

Mr. Clarke often calls for struggle (including class struggle) to achieve reformist aims. Of course, we should struggle to obtain higher wages, more secure employment, safer workplaces, expanded and better social housing, expanded universal healthcare, childcare and so forth. But why does he include struggle for an enhanced welfare state and exclude it from the process by which basic income arises? Mr. Clarke provides no reason for his exclusion of struggle for a basic income. He simply assumes that the class of employers will automatically achieve a minimal form of basic income–and simultaneously assumes that, if we struggle, we can achieve an enhanced welfare state despite the resistance of the class of employers.

I will simply quote from previous posts as well as from above Mr. Clarke’s many references to the need for struggle in order to substantiate my claim that he emphasizes struggle for enhanced welfare reforms, on the one hand, while ignoring the possibility and the need for struggle to achieve a robust basic income that threatens the existence of the market for workers on the other; such a collection of quotes provide a concentrated form of proof of my claim (rather than just being scattered). The quotes are sometimes overlapping since Mr. sometimes simultaneously argues for the need to fight for enhanced welfare reform while ignoring such need in the case of a robust radical basic income: 

Mr. Clarke’s Call for Class Struggle in the Case of an Enhanced Form of Welfare Capitalism

The alternative is to rejuvenate our unions and fight for decent wages, to fight to increase minimum wages, to fight for workers’ rights–rather than extend the cash benefits and extend the reach of the marketplace. It is far better to put considerable effort into the struggle for public services. … 

We need a fight to ensure that disability benefits are adequate and meet people’s needs and that they are secure. We need to challenge the intrusion and moral policing that goes on within these systems.

Again: 

But to extend the cash benefit widely out into the workforce is a huge mistake. And we could do so much better. Rather than try to get what in practice would be a meager cash benefit, it would be so much better to struggle to challenge the commodification of housing, the neoliberal city, the blighting of urban space with this agenda of greed by fighting for a massive extension of social housing. So that’s a benefit that goes to working-class people and does not go into the pocket of landlords. There’s a need to fight for increases in the adequacy of healthcare. The pandemic has made that absolutely clear. We need pharmacare, dental care, a unviersal childcare program that is not an empty perennial liberal promise. We need post-secondary education to be free; we need free public transport systems. On all of these fronts, we need to take up a fight.

But people will say: We have suffered defeats. We cannot win these things. Mr. Clarke argues that the left has for a very long time been forced on the defensive. The class struggle has not gone in our favour for a considerable period of time. But there is no alternative but to rebuild and to fight back and to win what we can. And to challenge this society but to fight for a different society. That’s absolutely indispensable. There in fact is not some social policy ruse that can just put things right.

Again: 

During the pandemic, struggles have broken out across the world, from Minneapolis to New Delhi to East Jerusalem. As the global health crisis subsides, there will be a strong determination to fight for something better. As we challenge, not just the ‘economic scarring’ left by the pandemic, but the impact of decades of austerity, we shouldn’t settle for a commodified form of social provision that makes its peace with the neoliberal order. We need to fight employers to win decent wages and to take to the streets to demand massively expanded social housing, greatly improved public healthcare, free public transit, universal child care and much else beside.

Mr. Clarke’s Lack of Reference for the Need to Engage in Class Struggle in the Case of the Proposal for Basic Income

Let us now see how Mr. Clarke presents basic income: 

Basic income is not going to solve the problem. Our lack of strength, our lack of ability to fight in the way we need to fight is the problem we have to address. We need to build that movement now more than ever. In this situation of global crisis we need more than ever to fight back, and we can do so much better in focusing our struggles than to fight for the commodification of social provision and basic income.

Again:

I wish I could convince more BI supporters to consider the foundations before they try to put the roof on. One such supporter told me a few months ago that my arguments on the role of income support in this society constituted ‘an irrelevant history lesson’ but I beg to differ. To provide nothing at all to people who are unemployed or otherwise outside of the paid workforce has proven impossible so income support emerged to contain social unrest. However, it is always provided reluctantly and to the least degree possible because it limits the economic coercion the job market rests on.

Conclusion

This inconsistency is explained by Mr. Clarke’s reformist aims. Despite Mr. Clarke’s references to exploitation  and economic coercion, he assumes that they are somehow fixed and permanent. Rather than directly trying to develop a movement for abolishing exploitation and economic coercion (with a struggle for both enhanced welfare reforms and a robust basic income being linked to such an aim), Mr. Clarke proposes reformist measures that do not address at all the issue of exploitation or economic coercion as such. Somehow, the movement for welfare reform is supposed to lead to taking over the machines owned by employers. This is utopian in the bad sense of the term as being unrealistic. 

Rather, a proposal for a robust basic income that questions the premises of the class power of employers and the associated economic, social and political relations would point the way out of both the current situation and the class situation that we constantly face. 

In a future post, I may will inquire into a possible explanation hinted at above: Mr. Clarke’s real aim is not the elimination of capitalism but of neoliberalism.