THE DANGERS OF SOCIALISM

Press, Volume LXXII, Issue 21972, 22 December 1936, Page 15

THE DANGERS OF SOCIALISM

TO TH» EDITOB Of THB FKIBS. Sir,—Mr O'Regan writes .of the incomprehensible formulae of Karl Marx. The cogltatio is of Marx ovei a lifetime of study should be known to every thinking man and woman. The basis of his reasoning rests on the conclusion that, not only history, but also religious and other ideological conceptions of mankind are governed, through various epochs, by the mode of production of the necessaries for man's material existence. In other words Marx says that always, in the past and in the future also, the first consideration in man's mind will be the wherewithal to continue living. The capitalist system he defines as being dependent upon the profit derivable from the exploitation of labour. He says that the fundamental source of profit is the purchase of labour power at a price less than that received from the products of that labour power, Market fluctuations, for example, as a source of profit are not disregarded but treated as casual only. It is important here to note that Marx holds that no production can, or does, take place without human labour power, even if it is restricted to the mere tending of machines. Fundamentally, then, ifaarx holds that the only thing that can be bought cheap and turned over at a higher price is human labour. Human labour is a commodity and the trend of the capitalist system is to keep it, in the absolute, at a low costing figure. This is achieved, e.g., by Increasing the turnover of labour with the aid of machinery, thus giving rise, as a consequence, to a reserve army of labour —the unemployed and partially unemployed. As between individual capitalists, the same cause involves them in intense rivalry, ultimately re«

i! ng *" the weakest going to the wait and centralisation amongst the strongest. Marx brings into clear relief the distinction between production lor use and production for exchange, with which is allied the division of labour and exchange value. He shows that- there must be an ever-increasing growth of constant capital (plant, machinery, etc.), at the expense of an ever-diminishing variable capital (wages, salaries), bringing about in itseif deficiency in effective consumption. However, and now we touch on casual sources of profit as distinct from the fundamental, the credit system is such that it can, for varying periods, boost the inherently deficient consumption.

Marx holds that the money system, as we know it, constitutes a power capable of feeding upon itself, as it were, and thus enabling an initial unit to increase in amount—at a cost to someone by way of interest or one of its derivatives. Money, therefore, instead of being a simple means of exchange, is endowed with special qualities in itself. The point seems to be that, whereas commodities in goods waste in value because of storage charges or deterioration, money, on the other hand, is possessed with the power to increase itself. Therefore, side by side with the exchange value of goods, we have the operation oC the exchange value of money as money. This raised in Marx's mind the formulae, cemmodity-money—commodity and money—commodity-money. The essence of the first is the expression of money in its true sphere as a medium for the exchange of one commodity for another commodity for use. The essence of the second is that of money breeding money by the purchase of a commodity at a low price for resale at a higher price. This defines Marx's idea of the evil of the money system, the grafting on of something additional to its acceptable use as a medium of (..-.change. We have then, according to Marx, two major considerations. First, the pressure oC capital to keep the absolute cost of labour down, the downward drive being accentuated by the anarchic competition between capitalists, the whole being viewed from the perspective of human labour being the moving spirit in every degree of production and the fundamental source of profit. Second, the use of a money system acceptable as a medium of exchange, but possessing, in addition, the quality of breeding in kind and thus importing into the realms of production and consumption something exterior to the reality of these factors as direct influences on the material existence of men. Mr O'Regan must deny the above considerations, otherwise he cannot uphold mere land-value taxation as "the most fundamental and necessary of all reforms."—Yours, etc., L.D. December 21, 1936.