Capital & Class. - 1989. - Issue 37 issue 37

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Martin Spence TV after the White Paper

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Few Government statements have been as long-awaited, or as often postponed, as the Tories' White Paper on the future of broadcasting . Broadcasting in the '90s : Competition, Choice and Quality (Home Office, 1988) was finally published in November 1988 after at least three years of threats and promises, and several weeks of repeated and comprehensive leaking . It was immediately hailed as . . . the biggest Tv shakeup for thirty years' (Financial Times 8/11/88) . This is not just overheated journalese . The White Paper does represent a rupture with a thirty-year consensus on the regulation and financing of broadcast . It also represents a case study in the current phase of Thatcher's project ; in the interplay of that project's two 7 guiding instincts, the authoritarian and the deregulatory; and in the limits to its understanding of the real processes of capital accumulation with which it is playing . The White Paper considered both television and radio . This paper will look only at television .



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II Broadcasting presents something of a problem for capital, in that it has not so far been possible to commodify directly the act of broadcast itself. The whole point of broadcast is to propagate a message in the electro-magnetic spectrum for widespread reception . Anyone with suitable equipment - a radio or TV set - can then receive and 'consume' that message . It has not been possible to restrict access to each individual message or to give it a price : the message is, in effect, 'free' . There are two major mechanisms whereby this apparently 'problematic' activity has been integrated into capitalist society . Firstly, the State in its security role has always taken a great interest in broadcasting . This is partly because broadcasting impinges on its own military and police communications : in both Britain and the USA, early radio broadcasts were initially banned by the military, and in the USA the Navy sought unsuccessfully to monopolise all radio wavelengths . But in addition, at certain historical moments - such as the General Strike in Britain - the State has seen broadcasting as a tool which can be used to help reinforce and disseminate its own perception of 'the national interest' . The second mechanism has been the development of a new area of commodification - advertising . It may not be possible to put a price on individual broadcast messages, but, once a broadcast system is in place, with a guaranteed audience, it is possible to put a price on access to that audience . The sale of airtime to advertisers has been an enormously profitable business in its own right, and has helped create the cultural framework for the mass consumption which has underpinned the whole Fordist era . The 'duopoly', which has dominated British Tv for the past 30 years, reflects these two mechanisms of integration .

Firstly, there is the BBC which started life as a consortium of private electronics companies . In 1927, having proved its usefulness during the General Strike, it was established as a public corporation, and rapidly became accepted as a national institution, transmitting that dominant version of the national culture which already existed within Britain's ruling class, . BBC television broadcasts started before the War, stopped in 1939, and were resumed in 1947 . Since the mid-1960s it has broadcast two Tv channels . Initially the whole operation was financed from the licence fee, levied on all owners of Tv sets and collected by the Post Office . More recently, revenue from overseas sales and the activities of BBC Enterprises have become increasingly important, but the licence fee still accounts for about 90% of income . The BBc is overseen by a Board of Governors, appointed by the Government . Alongside the BBC, and competing for the same audience, sits the commercial Independent Television (tTv) network, established by the 1954 Television Act . The introduction of commercial Tv both contributed to and benefitted from the 1950s consumer boom: Tv sets figured prominently on the list of new consumer durables . nTv is regulated by the Independent Broadcasting Authority (mBA) which, like the BBC Board of Governors, is Government-appointed . The network consists of 15 companies which have been granted franchises to provide regional or breakfast-time Tv programmes ; and also Channel 4, which is a whollyowned subsidiary of the IBA . The system is funded from advertising revenue, with Channel 4 financed by a levy on the try system as a whole in such a way that, although it broadcasts at the same hours and in the same geographical space as the other companies, it does not directly compete with them for advertising . In this way, the try system as a whole is in a monopoly position as a seller of Tv advertising .

TV Broadcasting

The key argument of apologists for the duopoly is that BBC and ITV/c4 compete for audiences, but not for the same source of revenue . The theory is that this encourages them to put on attractive programmes as they battle for ratings, but it discourages them from indulging in short-sighted costcutting which might threaten quality .

III The new broadcasting structures outlined in the White Paper represent a radical break with the regulatory traditions, and the methods of financing, described above . They can be summarised as follows :For the BBC, the structural status quo will be maintained until the mid 1990s . The licence fee will be pegged to the Retail Price Index until 1991, then deliberately pitched below it so as to provide an incentive to develop subscription as a new source of income . When the current Charter expires in 1996, there will be a thorough review of the BBC's role and structure . The White Paper's most dramatic proposals are reserved for commercial TV :Both the IBA and the Cable Authority will be replaced by a new regulatory body, the Independent Television Commission (ITV), which will operate with a 'lighter touch' . ITV franchises will be sold in an auction, with cash bids rather than programme quality as the key arbiter . After new franchises have been allocated, to run from January 1993, City takeovers of franchise-holders, which are forbidden at present, will be permitted . Franchise holders will be obliged to take at least 25 % of their programming from 'independent producers' - a category which is left undefined - and will be permitted to take this arrangement to its logical conclusion by acting simply as 'publishers',

buying in all their programmes from other producers, rather than employing permanent production staff of their own . The whole iTv network, renamed 'Channel 3', will be given a more regional character . Most crucially, there will be no commercial Tv monopoly . Channel 3 will have to compete for advertising, sponsorship and subscription income against a de-linked Channel 4 ; several satellite channels, including 16 on the Astra satellite, and another 5 on the British Satellite Broadcasting (ass) satellite, by mid-1990 ; local cable and MVDS (multipoint video distribution system) channels, with new franchises operational before 1993 ; a new national Channel 5 to start early in 1993 ; and possibly a new city-based Channel 6 . The most striking aspect of the White Paper is therefore its emphasis on the wholesale restructuring of commercial television . This is not where the Tories came in .

IV Throughout Thatcher's period in office, it is the BBC which has been under constant attack, a classic example of the Tories' authoritarian instincts . Over the past eight years, an impressive schedule of BBC programmes has provoked Tory attacks, starting with a 'Panorama' film of an IRA road-block in 1980 ; news reporting of the Falklands War in 1982 ; news reporting of the us bombing raid on Libya in 1985 ; the Real Lives programme on Ireland in 1985 ; the Secret Society series in 1986/7 ; the radio series My Country Right or Wrong? in 1987 ; and a 'Panorama' story on 'Spycatcher', still not broadcast, in 1988 ; plus rows at different times over dramas such as The Monocled Mutineer and Tumbledown . Verbal attacks have been backed up by a Special Branch raid on the

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offices of BBC Scotland in early 1987 to seize material from the Secret Society series, and an auc raid on both BBC and ITN to seize news material in the Six Counties a year later . What characterises all these incidents is their common focus on issues of 'national security' and 'the national interest' . The BBC's reporting of the Falklands War was described in Parliament as 'near treason', and similar accusations have been levelled after some of its Irish coverage . These political attacks on BBC programming, and public questioning of its patriotism, have gone alongside an overtly political restructuring of the BBC Board of Governors since 1980 . The tradition that the Chair and Vice-Chair should never both be known supporters of one political party was abandoned when known Tories (Stuart Young and William Rees-Mogg) were appointed to the two positions . Once restructured and politically stiffened, the Board has taken an unprecedentedly active role in banning individual programmes (such as Real Lives in 1985, which it banned in response to a direct appeal from the Home Secretary), and in sacking its DirectorGeneral (Alasdair Milne) in 1987 . But why should the Tories feel the need to launch this political attack on the BBC? Arguably since the 1930s, and certainly since the 1940s, the BBC has occupied a unique place in British society . Precisely because of its traditionally semi-detached, arms length relationship with the State, it has been a major force in shaping midtwentieth century British political culture . The BBC was after all the product of an historical period in which Labour-Tory twoparty politics, and a paternalistic conception of public service borrowing both from colonial/administrative and from municipal/ corporatist traditions, came to be widely accepted . It has faithfully reflected these origins both in its own organisation, and in certain key programming criteria such as its

traditional notion of political 'balance' . For Thatchei s Tory Party, however, the BBC's operational definition of British political culture, which legitimises both the traditional right and the Labourist left, is a problem. It threatens to block the Thatcherite attempt to re-interpret political culture in much narrower terms, delegitimising any democratic or socialist content . Hence the frontal attack . By questioning the patriotism of the BBC, the Tories call into question not only the Corporation itself, but, conveniently, much of the cultural legacy of the post-war period .

V The second Tory instinct identified above was the urge to deregulate, to 'set market forces free' . It is this which has motivated the attack on irv, and which is most in evidence in the White Paper. In its first few years commercial Tv looked as if it might flop, but by the late 1950s the franchise holders were making fortunes . A levy on profits was introduced in the 1960s, but most iTv companies have nevertheless remained good earners, attracting a renewed bout of interest, especially from us investors, in the mid-1980s . rTv's advertising monopoly has of course always been unpopular with the advertisers, who claim they have been over-charged, an argument which was rehearsed at length in the run-up to the White Paper by organisations such as the Advertising Association, the Incorporated Society of British Advertisers (IsBA), the Institute of Practitioners in Advertising, and others . Part of the advertising lobby's complaint is that ITv's monopoly has created an environment in which trade unionism has thrived . In the BBC, a tradition of corporate loyalty led initially to a tame Staff Association complete with no-strike policy . But in

TV Broadcasting

commercial TV, workers were quickly recruited in the 1950s by unions such as ACT, which extended its base from the film industry to Tv technical and production staff . In 1955 ACT struck for recognition ; in 1956 it acknowledged its new role in television by changing its name to ACTT ; and in 1957 it signed its first national agreement with the companies . The companies were unavoidably reliant on skilled technicians - especially in the days before videotape, when all broadcasts were live - and acutely aware that any industrial action by these technicians would have an immediate and public impact . This, plus the financial margin provided by their high profits, pushed the companies to concede good wages and considerable job-control to ACTT and to other staff unions such as the EETru and NUJ . And trade union strength in iTv undoubtedly had a knock-on effect in the BBC, where the Staff Association became the ABS and, in 1967, dropped its no-strike policy . Circumstances now conspire to create a powerful challenge to this arrangement . Firstly, there is the advertising industry, whose complaints about the ITV monopoly go back years, but are now mounted with a new urgency . The changing patterns of production and consumption which are sometimes summarised as 'post-Fordist' place a premium on increasingly tight targetting in marketing and advertising strategies . Commercial Tv as it exists does not offer this facility : on the contrary, it is traditionally described by advertisers as the 'blunt instrument' (Myers, 1986, p . 43), good for selling mass consumer goods to mass markets, but relatively insensitive to more refined strategies . Advertisers increasingly want access not to a maximum number of undifferentiated consumers, but rather to an optimum number of consumers within well-defined target groups . For instance, ISBA wants Tv to give

access to particular consumer groups such as 11 young people and 'high income groups', rather than mass audiences (House of Commons Home Affairs Committee, 1988, pp . 153-4) . Mass appeal can be a positive disadvantage, diffusing and blurring the impact of an advertising campaign . The Government is naturally sympathetic to the advertisers call for greater competition - especially now that it is itself the single largest advertiser in the country . Aggregate Government departmental spending on press, PR, advertising and promotional literature in 1987/8 was £368 million, the biggestspending departments being the MSC, DHSS, and Department of Employment (Franklin, 1988) . But both the Government and the advertisers know that liberalisation of Tv advertising can only be achieved by creating a wider environment which breaks the back of Tv trade unionism . This requires positive legislative and administrative action . And it is of course here, in its attitude to the trade union movement, that the apparent paradox of the Tory Party's twin instincts, the authoritarian and the deregulatory, is resolved . The offensive against ITV has taken the form of constant hints and warnings to management that unless they get their house in order, severe measures would be taken . Specifically, ITV (and BBC) were told in 1986 that they must voluntarily increase the proportion of programmes commissioned from external ('independent') producers to 25 by 1990 ; if they didn't do it voluntarily, it would be done for them compulsorily . This was backed up by Thatches s 1987 comment that ITV was 'the last bastion of trade union restrictive practices' . ITV companies quickly turned this external pressure inwards, using it to justify the imposition of job cuts and new working practices . Tactics admittedly varied from place to place : Tv-am and Tyne Tees provoked confrontations, while Central,,

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12 Granada and Tvs adopted a more consensual style . By mid-1988 ACTT's National Agreement with the ITv companies no longer existed, and BETA, the EETPU and NUJ were operating with limited 'core' agreements . Industrial relations in ITV were reverting to local bargaining . And in new areas of organisation such as satellite, companies quickly announced that they either wanted single union no-strike deals (BSB) or that they would recognise no union at all (Sky) . Due to the unitary, corporate nature of the BBC, compared to the relatively fragmented rrv companies, it responded to Government demands even more efficiently . The partial privatisation of BBC Enterprises, specialist subscription Tv services (such as a night-time service for doctors), new working practices, and 1,000 jobs to go by 1993, are among the demands laid down by Michael Checkland, the Director-General since 1987 . Finally, the Government's most direct anti-union intervention has been to invoke an obscure clause in the anti-monopolies legislation, and wheel in the Monopolies & Mergers Commission to investigate 'restrictive labour practices' in Tv . At the time of writing the Commission has yet to report. If the commercial Tv system is dismantled as proposed by the White Paper, a new pattern of industrial relations and working practices will take shape . There will, at least initially, be more Tv companies : not only the ITV network ('Channel 3'), but also Channels 4 and 5, maybe Channel 6, plus microwave, cable, and DBS (direct broadcasting by satellite) . But they will all be competing for ratings and revenues ; Channel 3 will have a statutory obligation to buy in a certain proportion of programmes from outside ; and Channel 3 franchise-holders will have the option to act simply as 'publishers' rather than programme-makers . The overall result will be a reduction in permanently employed staff to a tiny number in commissioning, administration, finance,

and transmission . Production will be almost entirely casualised, into a great pool of chronically-insecure freelance labour. There is already a network of large and small production companies, facilities companies and freelancers which has coalesced around Channel 4 - also a publisher rather than a maker of programmes . But this has happened within an overall regulated environment . It bears little resemblance to the hectic priceand wage-cutting heralded by the White Paper. As a result the Tv unions, despite their traditional strength among permanentlyemployed skilled technicians and production staff, may find they increasingly face organisational and recruitment challenges similar to those faced by such superficially different unions as GMBATU, TGWU or USDAW .

VI The three sources of commercial funding to which the White Paper looks are two relatively unknown quantities - sponsorship and subscription - and one known quantity - advertising . It is impossible to say with certainty how much sponsorship money might be available from private capital . Some ITv companies have tried to test the water over the past few years, only to be blocked by the IBA . The BBC, however, has estimated that perhaps £30 million per annum might be available (Television Week 3/11/88) . This represents just over 1176 of the current combined BBC/ ITV budgets . Unless this estimate is wildly wrong, sponsorship will not be a major new source of revenue . Subscription, in principle, represents the genuine commodification of broadcast : it puts a price on access to an individual broadcast message, or at least to an individual channel . Subscription channels can be delivered by

TV Broadcasting cable, terrestrial broadcast, or satellite, though of course with satellite there is the added capital cost of a dish aerial, which on current estimates ranges from £200 .00 to £1000 .00 . The only significant UK experience in subscription Tv is cable . Cable Tv has been a disaster, largely due to the Tories' insistence that it must be financed entirely by private capital . Early hopes of 8 million subscribers by 1990 (Negrine & Goodfriend, 1988) were soon dashed : by late 1987, only 222,000 households had signed up, representing 17% of those passed by cable systems (House of Commons Home Affairs Committee, 1988, p . 75) . The cable operators nevertheless remain publicly bullish . They point to the recent explosion of cable in the USA, where it is eating into the audiences of the big commercial networks and of the Public Service Broadcasting System . us companies are also fast becoming the major investors in British cable franchises . But experience both in North America and in Europe suggests that cable - and by implication other subscription services only takes off in a big way when viewers are consciously dissatisfied with available Tv channels (Collins, 1986, p . 303) . This is not currently the case in Britain, where the evidence suggests a generally high degree of satisfaction . But it does raise a question for the future . Companies aiming to provide wholly or partially subscription-financed Tv cannot provide an attractive range of programmes until they establish a large and secure subscription base. But they cannot establish a large and secure subscription base unless and until there is widespread dissatisfaction with the existing, universally-available BBC and ITV/C4 channels ; or until some of these channels are withdrawn from universal access and put on a subscription basis themselves. If the would-be providers of subscription Tv were setting out their requirements to a

sympathetic Government, they would call above all for a financial attack on BBC and ITV/c4 so as to undercut their production values and encourage audience dissatisfaction ; followed by the transfer of some of these channels from universal access to subscription . This is precisely what the White Paper advocates . And yet still the uncertainty remains . The gap between hope and reality for cable subscribers is spelled out above . For satellite, estimates of subscribers range from the 6 million in five years forecast by BSB, to 150,000 predicted by media consultants CIT (House of Commons Home Affairs Committee, 1988, p . 257) . Advertising will therefore remain the main source of funding for a greatlyexpanded range of commercial Tv . Advertising overall has enjoyed a sustained boom from the mid-1970s, save a small dip in 1981 . Tv has managed to expand its slice of this growing cake, with its advertising revenue rising at a rate of 11-12% per annum through the 1980s, to a total off 1 . 3 billion in 1987 (Financial Times 13/7/87) . Some in the industry foresee the advertising boom continuing indefinitely: Saatchi and Saatchi, for instance, predict that Tv's income from advertising will go on rising inexorably at a rate of 10 % per annum to the mid-1990s (Financial Times 13/7/87) . But behind this assumption of sustained rising investment in the temptation of potential consumers, lies a further assumption about sustained levels of consumer spending . At the time of writing (December 1988) there is no clear end in sight to the consumer boom . However, if we follow the Saatchi brothers and look as far ahead as the mid 1990s, then a reduction, even at some point a sharp reduction, in the level of consumer spending, is perfectly feasible . In these circumstances there need not be a drastic reduction in advertising spending overall, but there may well be a relative shift

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in such spending away from TV and into, other areas - newspapers, magazines, and deregulated radio which can reach its audience

television . In 1989, 16 satellite

from a much lower capital base . Satellite television is international in its reach . This might imply that we are too parochial in looking only at levels of consumer spending in Britain, since rv advertising will become 'pan-European' and will reflect economic conditions throughout Western Europe . As with sponsorship and

satellite, and a further 5 from BSB will follow in the next year . By 1991, if the White Paper's proposals are enacted, the BBC's income from the licence fee will be pegged consistently below the aPi, and at about the same time the ITV companies,

subscription, it is too early to say with certainty what the potential is for 'panEuropean' advertising, but the signs are not particularly good . The two English-language satellite Tv services already up and running, SkyChannel and SuperChannel, have both lost millions . In early 1987 SuperChannel, set up to beam the 'best of British' television to Europe, thought that the level of panEuropean advertising would quickly double . By late 1988, the 'best of British' channel was in financial ruins and had been taken over by an Italian pop music station . SkyChannel appears more robust by virtue of being part of Rupert Murdoch's media empire: it is losing £10-15 million per annum, but Murdoch intends to stay in business and is projecting losses of £100150 million before breaking even (Financial Times 27/7/88) . Significantly, the advertisers themselves are very cautious about the potential of panEuropean advertising and prefer to concentrate their resources on the national market (e .g . SIBA, quoted in House of Commons Home Affairs Committee, 1988, p . 151) A continental market of hundreds of millions of consumers, in which there is sufficient cultural homogeneity to allow effective continental advertising, is perfectly feasible. The USA and Canada constitute just such a market . But Europe, with its ancient patchwork of ethnic, linguistic and cultural pecularities, does not . All of this adds up to a sustained crisis in

Tv channels, funded by a mix of advertising and subscription, will be available from the Astra

plus others such as Murdoch, Maxwell, Carlton Communications, Virgin, and W .H . Smith, will be putting in their cash bids for the new Channel 3 franchises . Some of these companies will also apply for the new national Channel 5 franchise . At present, Tv's share of advertising revenue is divided between 15 regional ITV companies and Channel 4 . By the start of 1993, it will be fought over by two national services on Channels 4 and 5, a number of regional operators on Channel 3, a number of local channels on cable and MVDS, plus 21 channels beamed down from satellite . The cost-cutting which must result will feed through into production budgets . It will lead to even heavier reliance on familiar, cheap production formulae : repeats, studiobased talk-shows, game-shows, soap-operas ; and also on cheap programmes bought in from outside : shoestring-budget commissions where exploitation is subcontracted out to independent production companies and freelancers ; and imports from the USA, where producers can make their profits within the enormous domestic market and can therefore afford to export cheaply . 'Prestige' productions will still occur, mainly by the BBC, with an eye to international sales . Open-ended or high-risk programmes, such as investigative documentary or current affairs productions, will be axed . Drastically reduced production budgets are already a reality : satellite Tv companies are planning to spend about £5,000-6,000 per hour on production, about 10% of the BBd1TV average (House of Commons Home

TV Broadcasting Affairs Committee, 1988, p . 180) . This sounds like a recipe for a selfperpetuating downward spiral in production values and programme quality . In fact, such a decline must bottom-out at some point : advertisers and broadcasters need audiences, and must ultimately pay whatever is required to keep them . But it is certainly conceivable that the spiral of decline would ultimately find a level of programming which would be visibly poorer and cheaper than at present ; which would be financially, culturally and politically impoverished ; and yet would still retain a disgruntled but resigned audience . This does not mean that all the channels trumpetted in the White Paper will survive . Some will . Others probably will not . The experience of satellite 'rv suggests that those which survive will do so as subsidiaries of multinational multi-media corporations, prepared to bankroll their TV operations in the hope of profits to come, or as part of a broader marketing or political strategy .

VII It comes as no surprise to find that Tory rhetoric about 'competition, 'choice', 'quality', 'consumer sovereignty' and a 'full TV market', is nonsense . The White Paper owes much to the fantasies and enthusiasms of free-market ideologues and the advertising industry, and little to a sober assessment of the real mechanisms whereby television is integrated into the wider process of capital accumulation . The gap between right-wing fantasy and reality is so wide that the left has a real opportunity not only to ridicule the Tories' proposals, but to use the space created to set out a radical and potentially popular agenda of its own . This would start by spelling out that the 'choice' and 'quality' promised by the Tories can only be guaranteed by the democratic regulation of TV, and by giving it a

secure economic base which supports centres 15 of productive excellence, and which provides secure employment, training and re-training for TV workers . Such a programme is potentially much more in tune with technological opportunities than are the Tories' fantasies : many of the new broadcast technologies are open to a collective and democratic interpretation, in production (video), interactive communications (cable), local/ municipal TV (cable/MvDs), and international contact (satellite) . To realise this potential the left needs a programme which includes an explicit recognition of broadcast as a public service, an essential part of the cultural infrastructure of a democratic society ; new and accountable regulatory structures ; public control of essential assets such as British Telecom, which is the key to a properly-planned development of many of the new technologies ; and new forms of enabling public investment, to ensure that the range of TV output starts to reflect the plurality of experiences, voices and desires in society .

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Richard Barbrook

Radio after the White Paper In November 1988, the Home Office issued its White Paper on Broadcasting whose title promised a future of 'Competition, Choice and Quality' . The coverage of most media journalists and pundits was concentrated on the government's plans for expanding television . This was not surprising, as television is the primary source of information and entertainment for the majority of the population . However, the White Paper was not just concerned with the growth in television broadcasting . It also confirmed the plans outlined in an earlier Green Paper on the future of radio (Home Office, 1987) . What is more, the Radio Division of the IBA (Independent Broadcasting Authority) in line with these plans has already started the process of issuing licences to a new tier of community radio stations . In contrast to the new corporate television stations, there is a good chance that many of the new radio stations will be run by community groups . Much of the pressure for opening up radio

Radio Broadcasting broadcasting has come from grassroots lobbying, including illegal broadcasting by pirate radios . The radio sector is not simply 'television without pictures', it is a specific branch of cultural production with its own history and dynamics . It is likely that the licensing of a wide variety of new radio stations could have an important impact on British society . The Cosy Dominance of the Duopoly Britain's existing radio broadcasting system is a 'duopoly' of state and commercial broadcasters. The difference between the two systems is not just characterised by the types of ownership, state and commercial, but more importantly through distinct forms of revenue . From the beginning of hertzian broadcasting, the major problem for stations has been commodity-formatic .: . As the first president of the American radio network NBC saw the difficulty: . . the greatest advantage of radio - its universality and, generally speaking, its ability to reach everybody everywhere - in themselves limit, if not completely destroy, that element of control essential to any program calling for continued payment by the public .' (Sarnoff 1939 : 106) Until the introduction of recent technologies, listeners (or viewers) could not be charged directly for the programmes which they consumed . Therefore various parafiscal devices have been introduced to pay for broadcasting services . In Britain, the foundation stone of the 'duopoly' is that they do not compete for same type of parafiscal revenue . This has created symbiosis rather than competition between state and commercial broadcasters . For some, this has provided Britain with 'the best broadcasting system in the world', while others see it as the domination of the airwaves by a smug elite . C&C 37-B

The BBC (British Broadcasting Corporation) 17 was founded as a nationalised monopoly supplier of radio broadcasting in Britain . It grew out of an earlier private monpoly set up by the radio set manufacturers who wished to create a market for their products . Only when advertising funding was rejected and the levy on radio set sales failed was there a move towards a licence fee levied on set owners . From the beginning, this was seen as a price for listening to radio programmes . As a government committee on broadcasting put it : 'We are clear . . . that if funds are required to pay for the broadcast programme they should be contributed by thsoe who in fact receive it . . .' (Sykes 1923 : 20) This parafiscal device solved the problem of rcmmodity-formation in radio broadcasting in pre-war Britain . It also led to the nationalisation of the radio services, as state collection of the licence fees seemed inappropriate for a private company . The BBc was set up as an autonomous corporation, with day-to-day control over its own affairs . But, because its Board of Governors is appointed by the executive and the size of the licence fee is decided by Parliament, its independence is far from complete . The corporation aims to provide a 'universal service' both geographically and through specialised services . A recent survey of radio listeners shows how the Reithian concepts of public service have been internalised by the overwhelming majority of the British audience . (Barnett and Morrison 1988 : 113-126) . Recent conflicts with the Tory government have exposed the limits of the BBC's autonomy, but the insulation provided by the licence fee remains . This ensures that the corporation is the largest media producer in Britain . It is the major supplier of television programmes in Britain, as well as being an increasingly important exporter .

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Radio broadcasting now forms only a small part of the corporation's total output, but the BBC still remains the dominant company within this sector . The separate radio licence fee was abolished in 1971 due to difficulties of enforcement, and BBC radio services are now funded out of the television licence . In 1984/5, total BBC expenditure was £774m, of which 28 % was spent on radio . (Peacock 1986 : 13) . The corporation controls four national networks, regional services and 38 local stations . The other half of the 'duopoly' is the IBA, which is the regulatory body and transmitting company for commercial radio . The stations which it licenses are known as Independent Local Radios (ILR) . The legalisation of commercial radio came over a decade after the introduction of commercial television . The BBC had faced commercial competition from Radio Luxemburg since the 1930s . But the corporation's dominance over British society was not seriously challenged until the appearance of offshore pirate radio during the 1960s . These pirates were commercial stations broadcasting from ships in the North Sea which gained large audiences . The extent of their popularity led to great pressures for the licensing of pop music stations . The 1964-70 Labour government adopted a policy which combined repression with co-option . The 1968 Marine Broadcasting Offences Act outlawed advertising on or supplying the pirate ships, while the BBC was simultaneously authorised to set up its own pop music station . However, the establishment of Radio 1 did not satisfy the companies interested in running on-shore commercial stations, even if the pop music fans were placated . In 1970, the Tories won the election with the open support of the remaining pirate stations (LRW 1983 : 13-4) . The new government proceeded to introduce commercial radio through setting up the IBA . However, the dream of the pirates that

they would sail up the Thames to receive licences was not fulfilled . The new government converted the old commercial television authority into the IBA . The Chairman and members of the IBA were appointed by a government minister, though the authority was given day-to-day autonomy over its own affairs in the BBC tradition. The authority awarded franchises to companies who provided programmes for the radio transmitters run and owned by the IBA . The larger and more profitable stations subsidise the smaller and less profitable ones through a sliding scale of transmitter rentals (Porter, 1988 : 21-2) . Most commercial stations have been in and out of financial crises since their launch . Their biggest difficulties were during the early years of Thatches s government, with a 15 % fall in revenue during 1981-2 (Peacock, 1986 : 20) . In 1987, there was a 26 .8% rise in radio advertising revenue as the credit boom stimulated the whole economy (Deloitte, Haskins and Sells, 1988) . The ILRs have also benefitted from the rising costs of television advertising . In contrast with their usual state of crisis, the ILRs are now enjoying a brief moment of windfall profits with even the weakest stations making money . The IBA has been able to keep many MRS from going under . In fact, only one ILR has ever gone into receivership . Its policy of cross-subsidisation has helped create 48 commercial radio stations covering most areas of the country . This policy allows the IBA to claim that it is continuing the principle of universality . Although the IBA might not have been very good at enforcing public service commitments on the MRS, it has ensured the survival of many stations despite their poor economic performance .

Radio Broadcasting Continuing Pressures for Change As in other European countries, such as France or Italy, the pressure for the deregulation of radio broadcasting has come from a bizarre alliance of media corporations and community activists (Barbrook, 1988) . On one side, the Home Office has been lobbied by the advertisers and the would-be owners of national networks . On the other, it has come under pressure from the pirate radio stations and the community radio movement . The White Paper proposals are an attempt to find an uneasy compromise between these two divergent interests . One of the major groups campaigning for radio deregulation has been the Institute of Practitioners in Advertising (IPA) . It sees the expansion of radio broadcasting as necessary to create a larger market for the ad agencies . At present, the IPA complains, there are a large number of radio listeners, but only a minority are tuning into commercial stations (IPA 1987 : 6) . This has restricted radio advertising, making it only a small part of national advertising spending . Radio broadcasting is disparagingly called the '2% medium' by the advertising trade . In Britain, only 2 .3% of advertising money goes to radio stations, compared with 10 .5176 in France, 4 .1 % in Germany and 10 .6 % in the USA (Peacock, 1986 : 69) . The IPA wants the introduction of National Commercial Radio stations, (NcRs) . It hopes that these channels will provide the 'critical mass' of listeners to make radio advertising into a significant part of the industry . (IPA 1987 : 4) The IPA forecasts that this could lead to a doubling of radio advertising's share of the total 'ad spend' . This projection is supported by the IBA, which ' . . . is optimistic about the potential for a very significant growth in radio advertising revenue in the future, as radio penetration of the UK market increases and the image of radio as an advertising medium is enhanced' (IBA 1987 : 5) .

The authority also hopes to see radio 19 advertising rising to 4-5 % of Britain's total 'ad spend' . However, these forecasts could be wishful thinking or propaganda designed to head off the ILR's resistance to national commercial stations . The expansion of the number of commercial stations may not lead to a large increase in the total amount of radio advertising . Radio advertising is low in Britain because commercial television was introduced first . (Peacock 1986 : 94) As any NCRS could be starting at the same time as new television stations funded by commercials, they will face strong competition for corporate advertisers . The new commercial stations also face the problem of listener resistance to adverts on the radio . People are more hostile to radio than television advertising as they find commercials more intrusive in the former medium (Peacock, 1986 : 95 ; Barnett and Morrison 1988 : 43, 56-7, 102) . Whatever the potential problems of national stations, there are already a number of companies which are interested in the proposed NCRS . Within the existing tan system, there are eleven regional conglomerates of ILR stations . The years of economic crisis within the 1LR system created the conditions for the concentration of stations into a series of regional chains . The IBA approved of these amalgamations as a way of keeping on-air the weaker members of the commercial system . The next logical step for these dominant ILR companies is to expand their services into national networks . For example, Red Rose radio has bought two stations in Wales and one in Leeds . This grouping could provide the basis for an application for an NCR franchise . London's Capital Radio, in conjunction with 5 other 1LRS, is also rumoured to be interested in converting its local service into a national one through the Satellite Media Services network (The Guardian 18/7/88) . Capital is the most successful station in the IBA

Capital & Class

20

system . In 1985-6, this station was making 73% of total ILR profits! Outside the existing ILRS, there are the media multinationals which are searching for profitable markets . The major media corporations owned by Murdoch and Maxwell seem to be more interested in satellite television than radio . But the Virgin record company is one corporation which is preparing to enter into radio broadcasting . Virgin already owns shares in two ILR stations, Piccadilly Radio and Radio Mercury (Home Affairs Committee, 1988 : 52) . Now it has set up a firm called Radio Radio, which networks a night-time service around the MRS . This service is provided free to the ILRS as the programmes will be funded by national advertising sold directly by Virgin . The company wants to build up a national advertising base ready for an application for a national frequency . Virgin sees networking across the n.Rs as ' . . . a logical development towards an independent national radio station . . .' (Independent, 10/3/88) . Corporations such as Virgin are lobbying the Tory government for deregulation . But public pressure for more services results from direct action by pirate radio stations . The government has admitted that the popularity of pirates demonstrates there is a demand for new services (Home Office, 1987 : 14) . Audience research shows the strongest support for the pirates is among the ethnic communities . For example, nearly half of Afro-Caribbeans listen to the illegal stations (Barnett and Morrison, 1988 : 789) . The demand for specialist music and ethnic language programmes created the financial base for the new pirates . Illegal broadcasting went beyond the craze of a few hobbyists into the mass market (Barbrook, 1987 : 96-9) . At present, there are over 40 pirates operating in London, with other stations broadcasting in Merseyside, the Midlands, Scotland and Bristol . This is possible because there are dozens of vacant

frequencies on the FM band in every city in Britain and because costs have dropped . While Radio Caroline cost £250,000 to set up its operations in the North Sea, now a pirate transmitter sells for around £250! Unlike other European countries, there have been few political pirates and almost all the stations are broadcasting music programmes. The pirates have attracted a large audience. For example, London's Kiss-FM can credibly claim 250,000 listeners to its programmes (Gordon Mac, 1988, personal interview). This success of the pirates threatens the ratings and advertising revenue of ILR stations . For example, Capital Radio's market share has declined from 26% of the audience to 16% over the past few years, though new MRS in towns around London have also contributed to this fall (Deloitte, Haskins and Sells, 1988) . Therefore, it is not surprising that the Association of Independent Radio Contractors (AIRC), the ILR trade association, attacks pirate radio as ' . . . a menace and a nuisance . . .' (Independent, 13/1/88) . The AIRC wants the government to repress the rivals of its members . In response, the ministry responsible for policing the radio spectrum, the DTI (Department of Trade and Industry), has waged an escalating war against the pirates . Between 1985 and 1988, it cost £2,000,000 to enforce the broadcasting law with £800,000 spent in 1987-8 alone! (Butcher, 1988) . In 1985-6, the DTI's Radio Investigation Service carried out 217 raids on 67 pirate stations, mainly in London and Manchester . 124 people were convicted and fined (Radio Regulatory Division, 1987 : 26) . As the government seems unable to bring most pirates within the law, it is inevitable that this campaign of repression will intensify over the next few years . The problem facing the DTI is the financial viability of the pirates . Using cheap transmitters and microwave links, it

Radio Broadcasting has become relatively easy to avoid the law forbidding unlicensed broadcasting . During 1987-8, the major London dance music station, Kiss-FM, raised between £300 and £800 a week through advertising . This covered the costs of transmitters removed by the DTI's enforcement agency . On average, the station was busted once a weekend, though sometimes it was raided every day . Kiss-FM built up its large audience through promoting black music, such as hip-hop, house, disco and other styles . There is an interesting parallel between the dependence of Kiss-FM on microelectronics for cheap tansmitters and the station's promotion of house music which is created through similar technologies . Contrary to the lowtech image of radio, both the hardware and software of the new stations are reliant on the latest advances in technology . Alongside the pirate radio stations is the community radio movement . This is centred around the Community Radio Association (cRA), which campaigns for non-commercial broadcasting run by co-operatives or voluntary organisations . This has concentrated on lobbying work and putting forward plans for a viable new sector of radio broadcasting (ciA 1987) . The caA has had an ambiguous relationship with the pirates . Many cnA members disapprove of the illegal tactics of the pirates, especially if they see music stations as competitors for their own projects . But other members are themselves involved in pirate stations. Faced with an unresponsive Home Office, there has been a gradual convergence between the two halves of the movement . It is the advances in the means of production which creates the possibility of transforming the methods of production as well . A community radio station can encourage access by its listeners, either directly or mediated through the telephone . The breakdown of skills can lead towards the American-model of the computer-operated

station . But, alternatively, the dissolution of technical hierarchies can become a way of creating internal democracy within a station . It becomes possible to organise stations as co-operatives or voluntary organisations . Stations can become a focus for the identity of groups excluded from the dominant culture of a nation . This connects the campaign for community radio with wider struggles within capitalist societies .

Alternative futures for British Radio Broadcasting Thus, divergent lobby groups have very different visions of how radio should be expanded in Britain . The Home Office is faced with the task of trying to reconcile these contradictory pressures . The Green and White Papers are a synthesis of various possible futures for radio, based on free market, corporate, paternalist or community methods of developing the new sector . The Thatcher government has reorganised many sectors of the economy through increased market competition and private ownership . Since the 1960s, many of the campaigners for more radio stations have called for the adoption of the 'free market' within broadcasting . Within the government, the DTI is known to champion greater deregulation of broadcasting as a way of stimulating technological innovation . It is also a strategy favoured by the older pirates with memories of the offshore period . Their views are expressed by Charles Turner of the Stockport pirate KFM who thinks that : 'The enforced plurality applied to all present ILK stations will be replaced by a plurality provided by a wide range of specialist and local stations .' (Turner 1988 : 8) Despite its rhetoric, the government doesn't seem very interested in this vision of free competition . The Conservative Party is

21

Capital & Class

22 afraid of complete deregulation as British radio would go through a period of turmoil like France and Italy . The anarchic possibilities of free market radio has led the Tories to preferring the corporate radio approach . The setting up of the National Commercial Radio Stations (NCRS) soaks up many vacant frequencies which could form a lattice of low-powered stations (Home Office, 1987 : 43) . As Timothy Renton the Minister of State at the Home Office put it in a recent speech (Feb . 1988) a national VHF frequency is a . . . premium spectrum which might otherwise yield some 200 local services .' The large capital costs of building national networks restricts the NCRS to the big companies owned by the media magnates like Branson, Murdoch or Maxwell . Moreover, the Home Office proposal to auction the NCR frequencies to the highest bidder will further limit the number of potential owners of a national service . Even if the NCRS do not do as well as is envisaged, they could still drive many MRS into receivership . The only thing which threatens the NCRS' long-term viability is the Home Office insistence that the national stations should not adopt a specialised format . A balanced format is likely to attract smaller audiences and less advertising (Porter, 1988 : 19) . The corporate approach restricts deregulation to allowing stations to own their transmitters and getting rid of certain 'public service' commitments . But controls will definitely be kept over programme content, political ownership and local council involvement (Home Office, 1987 : 31-7) . This policy represents a method of arriving at the present situation in France where the corporations dominate the airwaves, but without any intervening period of anarchy . Any radical community stations will be limited to the fringes of the system, assuming any receive a licence . The ideas of

free market economics are only useful as long as they lead to oligopolies! The corporate method of expanding radio represents one way of controlling the sector's growth from the centre . The government's approach also embraces a paternalist approach to radio . Sections of the Home Office are interested in radio as a social tool, especially in race relations and reconstructing inner city areas . They envisage a sector supervised by regulation and maybe even receiving some public funding . The growth of community businesses and voluntary organisations would be helped by a new tier of radio broadcasting . Interestingly, the only form of advertising found acceptable by listeners was local and community spots (Barnett and Morrison, 1988 : 100) . The Home Secretary himself hopes that community radio stations would help ' . . . to strengthen that combination of local identity and cultural diversity which lies at the heart of a flourishing community .' (Hurd, 1988 : 648) . The reintroduction of the radio licence fee has been suggested to fund these services (Porter, 1988 : 12) . The cRA encouraged this paternalism within the Home Office by calling on the government ' . . . to consider the wider social benefits of community radio in enhancing community development, promoting racial and social harmony and encouraging volunteers .' (cRA 1987) . However, while the Home Office is interested in encouraging neighbourhood stations from the top down, the association wants the new stations built from the bottom up . But the cRA does not oppose these Home Office attempts at incorporation and recuperation . On the contrary, it has encouraged the government to adopt such policies in preference to complete deregulation . Its strategy has been helped by the organisational unity of the community radio movement within the cRA, unlike the factional 'free radio' movements of other European countries . This unity has been preserved

Radio Broadcasting despite various internal conflicts. As with many voluntary organisations, the CRA membership covers a wide range of opinions from those who see community stations as a form of self-help to those who see them as a type of socialist self-management . There are projects interested in broadcasting to ethnic communities marginalised by the existing media and those who want to attract a mainstream audience . Despite these divergences, what unites the CRA is a commitment to the establishment of community radio as a third tier of radio broadcasting, distinct from both the state and commercial sectors . These new stations would be based on non-profit-making types of ownership in the widest sense of the concept . The CRA sees the new stations as being financed from a variety of different sources, such as grants, advertising, sponsorship and voluntary labour . This diversity in income is essential if stations are to ensure their economic independence . The founders of the CRA based their ideas on stations serving small geographical areas . This reflected the movement's inspiration from 1960s ideas concerning direct democracy and 'small is beautiful' . Though this type of station may be preferred by some activists, it is a model which has difficulties when adapted for ethnic communities and for specialist music fans who are scattered over wide areas . There are specific problems within many communities over who will control the new stations . For example, in Paris, the Zionists and anti-Zionists were forced to share the same frequency for Jewish programmes (Barbrook, 1987 : 115) . Neither the CRA nor the Home Office has worked out how such inevitable conflicts will be managed when licences are issued in Britain . In London, it will be even more difficult deciding which of the dozens of black/dance music stations should be licensed. Such a service will also meet with great opposition from commercial operators whether of the existing MRS or of

new stations . Once community radio moves from the margins into the mainstream, it begins to threaten the whole use of the airwaves for corporate profit-making . The Home Office has now produced firm proposals for the licencing of new stations (Home Office, 1988) . What is interesting about the present strategy adopted by the government is how far it is not simply a policy of deregulation . For a decade, the Home Office has delayed the releasing of vacant frequencies to many would-be broadcasters . Now they are about to license more stations, but in a method which will not please the advocates of small business radio . On the one hand, the government promises that 'lightly regulated' economic competition will lead to ideological pluralism in the media (Peacock, 1986). But, on the other hand, a Broadcasting Standards Council is being established to censor BBC, IBA and satellite programmes (The Guardian, 9/5/ 1988) . More notoriously, the government is tightening the law on official secrets, has banned members of Sinn Fein from appearing on television programmes and even organised a raid on the offices of BBC Scotland . This contradiction between social authoritarianism and economic liberalism has been responsible for the long delay in deciding government policy for radio broadcasting . The situation is clearer in the hightechnology sector of satellite and cable television . The large investment needed to start a new television channel restricts entry into this media market to multinational or state corporations . In contrast, as the pirate stations have proved, radio broadcasting is cheap and easy . This makes it possible for marginalised groups and communities to set up their own stations . Not only could community stations give political and cultural openings to people hostile to the Conservative Party, but also they could provide prominent examples of economic organisation other than a joint-stock company . It is precisely these

23

Capital & Class

24

latent possibilities within radio broadcasting which has paralysed the Thatcher government . In theory, it wishes to deregulate radio, but, in practice, it is afraid of the consequences . If entry into the marketplace is inexpensive, there is no guarantee that friends of the Conservative Party will win the ratings war in a competitive radio sector . These contradictions were exposed during the government's first hesitant steps towards the deregulation of radio broadcasting . In 1986, the Home Office announced an experiment in community radio broadcasting . A small number of stations with lowpowered transmitters were to be licensed to see if there was a public demand for new services. However, just four days before licences were to be given out, the government suddenly abandoned its plans . It soon became clear that this decision was a result of political paranoia . It was leaked that the then Chairman of the Conservative Party, Norman Tebbit, had vetoed the scheme because some of the new stations might broadcast programmes by Leftists or ethnic communities! (Barbrook, 1987) . Then the government decided to delay any further decision until after the 1987 election . They did this by producing the C~n Paper on Radio Broadcasting . Further delays were caused by the Home Office's failure to introduce a separate Bill to implement the Green Paper proposals . The expansion of radio broadcasting has been largely delayed until the omnibus Broadcasting Bill is passed sometime over the next Parliamentary session . The Green and White Papers are characterised by a top-down approach to the expansion of radio . The Green Paper does promise a policy which will allow many different types of radio station to broadcast . . the Government welcomes the prospect of a rich variety of services capable

of meeting a wide range of consumer tastes, including those of minority communities .' (Home Office 1987 : 28) The White Paper confirms this aspiration, but, in a significant choice of order, says its proposals ' . . . should benefit broadcasters, advertisers and listeners alike .' (Home Office, 1988 : 38) . One potential casuality of the deregulation of radio broadcasting was the BBC . The government's plans now include continuing the full range of BBC services, as the privatisation of Radios 1 ans 2 has been rejected . However, the Green Paper called for the end of the simulcasting of the same BBC or IRA service on more than one frequency . It was proposed that the frequencies released by this reorganisation should be used to set up three National Commercial Radio (NCR) stations . As the BBC national networks are not to be privatised, then commercial duplicates will be set up instead . It is only the auctioning of frequencies which has been incorporated from the free market economists into the White Paper (Home Office, 1988 : 37) . It is argued that the absence of a market in frequencies can lead to resource misallocation through the wasteful use of spectrum . The present system distributes public property to commercial interests almost free . The government presents its case for auctioning as a good method of obtaining revenue. The exclusion from the airwaves of all groups who cannot afford to purchase a frequency is a distinct hidden bonus of this policy for the Tories . The setting up of these national channels threatens the long-term finances of the MRS . Therefore the Home Office put forward . . proposals for lightening the system of regulation for MR . . .' (Home Office, 1987 : 24) . The major change would be allowing commercial radio stations to own and

Radio Broadcasting

operate their own transmitters . They would also be allowed to discard whatever was left of their public service commitments . The end of the old duopoly would be symbolised by the removal of radio regulation from the IBA altogether. Instead the Home Office will establish a separate Radio Authority . This will be 'a slimline organisation' dispensing . . . light regulation designed to protect the consumer rather than direct the broadcaster .' (Hurd, 1988 : 648) . Its major task will be awarding franchises both to ILRS and the new community stations . The authority will also be empowered to set programme standards, so protecting the consumer from left-wing politics as well . Its powers of censorship will be backed up with ownership restrictions . The authority will be directed to refuse licences to political or municipal stations (Home Office, 1987 : 33). The government is afraid that left-wing councils will fund radical stations out of local taxes . Not surprisingly, the proposed restrictions on multiple ownership by individuals and companies are more relaxed . No one can have financial interests in more than one national or six other licensed stations . There will be a 20% limitation on the share ownership of newspapers in radio stations and vice versa (Home Office, 1988 : 37-8) . Therefore the substance of the White Paper shows how the major development in British radio broadcasting will be the emergence of corporate radio stations as exemplified by the NCRS . However, there has been one major development which has encouraged the community radio movement . In its twilight days, the Radio Division of the IBA has announced it is going to award 21 incremental franchises within the existing ILR areas during 1989 (IBA 1988a) . The importance of this development is not just that it speeds up the granting of licences to new services . More importantly, the new stations will not need ' . . . to provide the full range of programming demanded by the

{1981 Broadcasting] Act, since this is 25 already being met by existing ILR contractors .' This has created the opportunity for 'specialist' radio stations to be licensed . Most notably, the IBA proposes that 7 or the 21 stations will be designated as 'ethnic' . This type of franchise will be granted in Greater London, Brixton, Haringey, Hounslow, Coventry or Wolverhampton, Central Manchester and Bradford (IBA 1988a) . What remains to be seen is how many community radio stations get these licences as opposed' to commercial operations . Moreover the government is proposing a 'draconian' fiveyear ban on holding any radio licence on any pirates caught after 1st January 1989 (cRA 1988) . With so few licences on offer, it will be impossible to bring most pirates within the established broadcasting system . Therefore unlicensed broadcasting will continue, but with little hope of eventual legalisation . Conclusion From the IPA to the CRA, everyone has seen the major problem as persuading the Home Office to release the vacant frequencies for new services . It appears that each of the lobby groups will gain something out of the licensing of new stations . Now the real problems begin : whether the new services will gain audiences and be viable . The new White Paper promises 'competition, choice and quality' . If the economics of these new stations are not healthy, it is likely that all three goals could be abandoned . As many listeners fear, it could even reduce the limited spread of programmes already available on British radio . The future of BBC local and national radio rests on the long-term future of the licence fee . The White Paper states that 'the Government looks forward to the eventual replacement of the licence fee' by subscription (Home Office, 1988 : 8) . As the corporation's radio stations are financed out of the tele-

Capital & Class

26

vision licence fee, this could threaten the whole basis of the sac's provision of radio broadcasting . Even if this threat is in the long-term, the 'double squeeze' on the growth of the licence fee puts pressures on the BBC to cut costs in radio broadcasting as elsewhere in its services . The prospects for the ILRS and NCRs does not look necessarily any better . Much depends on whether there is the expected growth in advertising revenue . The new services will attract advertisers in local and ethnic communities which have never before used the radio for promotion . It is also likely that there will be some growth in corporate use of radio for national advertising campaigns . The future of the community radio stations is more difficult to predict . If they do obtain licences, then they will be faced with the problems of raising money for staff equipment and running costs . However, if they can become an integral part of their communities, then they should be able to mobilise the voluntary labour and donations to survive even if other sources of income are scarce . The partial breakdown of the separation of workers and consumers from the means of media production is the key to the long-term survival of the most successful community radio stations . The major problem is likely to be the marginalisation of most community radio stations within a system dominated by the BBC and the corporate networks .

Bibliography Barbrook, R . (1987) 'A New Way of Talking : Community Radio in Britain' in Science and Culture, pilot issue . Barbrook, R . (1988) 'The Rise and Fall of Left Radio Stations in France' in Radio Academy, Number 15, March 1988 . Barnert, S . & Morrison, D . (1988) 'The Listener Speaks : the Radio Audience and the Future of Radio', Broadcasting Research Institute, London . Butcher, J . (1988) 'Written Answer to Question on Radio Broadcasting' in Hansard, 27th June, 1988 . Collins, R . (1986) 'Broadband Black Death cuts queues: the Information Society & the UK', in Collins, R . et al . (eds) Media Culture & Society : A Critical Reader : London, Sage . CRA (1987) 'Response to the Home Office 'Green Paper Radio: Choices and Opportunities' Community Radio Association, London . CRA, (1988) 'Incremental Contracts - A Step in the Right Direction', Community Radio Association, London. Deloitte, Haskins & Sells (1988) 'Will Big be Beautiful?' in Broadcast, 8th August, 1988 . Franklin, B . (1988) 'Central government information versus local government propaganda' : paper presented to History Workshop 22 . Home Office (1987) 'Radio : Choices and Opportunities, HMSO, London . Home Office (1988) 'Broadcasting in the '90s: Competition, Choice and Quality', HMSO, London . House of Commons Home Affairs Committee (1988) The Future of Broadcasting (vol . 111) : HMSO, London . Hurd, D . (1988) 'Written Answer to Question on Radio Broadcasting' in Hansard 19th January, 1988 . IBA, (1987) 'The Future of UK Independent Radio', Independent Broadcasting Authority, London . IBA (1988a) 'tan Outlines Plans for ILR Incremental Contracts', Independent Broadcasting Authority, London . IPA (1987) 'The Future of the Radio Industry', Institute of Practitioners in Advertising, London .

Radio Broadcasting (1983) 'Capital : Local Radio and Private Profit', Comedia/Local Radio Workshop, London . Moores, S. (1988) 'The box on the dresser : memories of early radio & everyday life', in Media Culture & Society, vol . 10, no. 1 . Myers, K . (1986) Understains : The Sense and Seduction of Advertising : London, Comedia . Negrine, R . & Goodfriend, A . (1988) 'Public perceptions of the new media : a survey of British attitudes', in Media Culture & Society, vol . 10, no . 3 . Peacock, A . (1986) Report of the Committee on Financing the BBC, HMSO, London . Porter, V . (1988) The Re-regulation of Radio Broadcasting, Centre for Communications and Information Studies, London . Radio Regulatory Division (1987) Annual Report 1985/6, Department of Trade and Industry, London . Sykes, F . (1923) The Broadcasting Committee Report, HMSO, London . Turner, C . (1988) 'Into the Straight' in Radio Academy, number 16, June 1988 . LRW

27

M

3

Ewan Davidson

C

You and the Community charge*

s 28

ca

One of the alarming effects of the Thatcherite majority is the speed with which the unthinkable becomes fact . Ergo, the poll tax, unthinkable even to the Tories in 1983, will be introduced in Scotland in April 1989 . The poll tax was first proposed for local government finance as a means of restricting metropolitan council spending - its rationale of creating local accountability however failed to impress the Wet(tish) Cabinet of the time . However, in 1984, a revaluation of domestic rateable values in Scotland took place . Revaluations are supposed to be carried out every 5 years . This, however, was the first anywhere in the UK since 1973 . Together with the reduction of central government support for local authorities (the percentage of rate support grant in the

" The title is drawn from a Scottish Office pamphlet advertising the advent of the Community Charge mailed to every household in Scotland in April 1988 .

The Poll Tax Scottish Regional budget has fallen from 64 .2 976 to 5 5 .5 % between 1982 and 1988), and the introduction of rate capping, it produced rates increases of 15 % and upwards . The Tories were unable to rationalise such activities and suffered heavy losses in the 1985 regional elections . Under threats of revolts and defections the Scottish Tories extracted a promise for the abolition of the domestic rates . A timely paper from the far-right Adam Smith Group revived the case for the poll tax, and this had been translated into a Green Paper by January 1986, which became law in Scotland in May 1987, weeks before the election . The extreme radicalism of the change produced by the poll tax can probably best be explained by the expediency of adapting an existing proposal to appease Tory voters, and, once again, the effectiveness of the Right wing 'think tanks' in providing these . The conspiracy theories which most of the activists in the anti-poll tax campaign prefer allow the Thatcher government too much ingenuity . The potential effects of the poll tax are however not dependent on the reasons for its introduction . It will effectively curb local authority spending and reduce running costs for business capital through the centralised Unified Business Rate . Spending curbs will reduce the independence of local authorities, in effect it will 'depoliticise' much of their policy-making . The effects on the working class will be increased debt, and increasing the amount of monitoring and harassment they experience from the state - however, in this case it will be the local authority which is seen as the perpetrator . The poll tax, however, represents a sizeable risk for the Tories - and that this risk was taken suggests that the restructuring of aspects of the British economy was much more of an emergency than is usually recognised . The risk has been minimised by introducing the tax in Scotland one year in

advance of the rest of the country . The 29 Scottish system of 2-tier local government means that only the 9 upper-tier Regional Councils (plus 3 small island authorities) need to be empowered and financed to collect the tax . In addition only the Scottish Office needs to be involved in making and revising such statutes as are required . This is important - the costs for administration and publicity for the tax, and the compilation of the Community Charge Register, together with the time and effort required to overcome resistance are entirely unknown . To demonstrate this, official estimates of the cost of implementation of the tax in England and Wales have risen from £90 m (Christopher Chope, Guardian, 5/12/87) to £357 m (Price Waterhouse report, quoted in The Guardian, 24/6/88) . In addition the collection costs of the tax, estimated at 4% of revenue recovered, are at least twice as high as the rates, and other taxes such as income tax and VAT . While the smaller scale of the Scottish legislation has meant that spending on administration can be funded quickly - the Scottish Office has already supplied twice as much funding to the local authorities as its initial estimate, and still has the rebate system to initiate - revisions of legislation and delays to schedule have still had to take place . For example the original legislation contains a specification that the Community Charge Register should be published in October 1988 . The register for Lothian Region has not yet (January 1989) been published - while only a small proportion of those who have not complied with registration have been fined . In many areas of Edinburgh the Register has simply been copied from the previous year's Electoral Roll, without any confirmation from the residents . Details of the rebate system due to be introduced in April have still to be announced .

Capital & Class

30 Resistance My local poll tax group, Southside Against the Poll Tax organised a weekly street stall during the summer of 1988 . On this we would have posters, leaflets, advice sheets and other poll tax materials . Most commonly, people would approach us and demand something to sign . We would produce a blank piece of paper which we would later throw away . So long as the big guns are claiming that signing petitions is adequate opposition, it is hard to get people to think about anything more dangerous . In Scotland the battle of the anti-poll tax groups has been to translate public support into an effective campaign . Opposition to the poll tax in Scotland is more or less general - the perception that it is a particular attack on Scots has heightened and legitimated this . Opinion polls conducted by MORI suggested 75 % disapproval in March 1988, and 70% in September 1988, while the support for non-payment tactics were 42% and 37% respectively . This is worth emphasising - 40% of those interviewed were prepared to support illegal action against the poll tax . The task of a political campaign against the poll tax must be to convert that level of opinion into effective resistance . For the Labour Party, as a constitutional opposition, this has been considered to be to risk the loss of legitimacy . That the main struggles against the poll tax have so far taken place within the Labour Party in Scotland is indicative of the hegemony in Scottish political culture of its hierarchy . The major achievement of the opposition in the Labour Party was to force the Scottish Executive to debate the poll tax policy at the Scottish Conference in March 1988 . Here a non-payment policy was rejected and a motion suggesting attacking the poll tax 'by all means short of illegality' passed by

460,000 to 280,000 votes - that is, by the trade union block votes . This is not the place to discuss the complexities of blockvoting, save to say that the TGWU delegation had been mandated to support non-payment, and was still able to reverse this policy at a delegation meeting during the Conference . At a further Special Conference in Govan in September, 400 delegates rejected nonpayment strategies by 512,000 votes to 225,000 . The effect of these decisions has been to effectively deny financial and organisational support to any groups thought to contemplate non-payment . Trades Councils and the sTuc, which are affiliated to the Labour Party are bound to support conference policy, while 'unofficial' Labour enclaves such as some community centres have also restricted access to anti-poll tax groups . Labour Party members have actively participated in only 4 or 5 of the 24 anti-poll tax groups in Edinburgh, despite the collapse of their official executive-backed 'Stop it' campaign over the summer . The inertia of the Labour Party has produced re-alignments of political support . The most obvious of these has been a 'swing' of opinion towards the SNP, spectacularly demonstrated by the by-election in the inner Glasgow seat of Govan, where a 15,000 Labour majority was overturned . There were also, however, SNP gains from Labour on Lothian and Fife Regional Councils at the same time . The SNP have been strongly identified with opposition to the poll tax they are committed to a non-payment campaign, and this strong profile has won votes . At the same time a group on the Left of the Labour Party have begun organising a new Scottish Socialist Party which might be expected to attract many of the constituency activists who are frustrated by the restrictions placed on their campaigns within the Labour Party . The campaign against the poll tax con-

The Poll Tax tinues without the Labour Party and the trade unions - led by an uneasy coalition of groups with what, for sake of space, we might call nationalist or Trotskyist or syndicalist or populist aspirations . They agree that effective opposition requires nonpayment strategies . They are outside (or on the 'far-Left' of) the Labour Party, and have very little else in common . Local poll tax groups tend to be dominated by one persuasion or another - nationalist and populist in small burghs, Trotskyist or syndicalist in the inner cities . The tactics being used are designed to encourage civil disobedience public meetings, door-to-door leafleting, pledge petitions, trust funds and street committees - or publicise the campaigns . The most successful has been the production of 'NO POLL TAX' window posters which have become very much a part of the Scottish urban landscape in the last 12 months . Most of the groups are now gearing up to produce materials on non-payment, the campaign against registration being almost concluded as a result of the use of official records by most Registration Officers to compile the registers . The most that can honestly be said about the degree of co-ordination of the campaigns is that Federations exist in Strathclyde and the Lothians through which the groups can meet and exchange information and materials . Attempts to develop a co-ordinated structure have been frustrated by the lack of common ground on strategy and organisation . The more candid councillors and officials admit that non-payment figures of 20% or more would wreck the tax - clogging up the legal system with debt cases, and making the setting of local authority budgets and the funding of projects impossible . The MORI poll in the Scotsman in September suggested that 8% of the interviewees were certain to refuse to pay while a further 16 76 were 'very likley' or 'likely' to refuse to pay . The 8% figure closely matches the 7,000

out of 90,000 households in the Lothians 31 which had not provided details for the Register before the October deadline . The task of the anti-poll tax groups is to support the 8 %, and encourage the 1696, against the cajolements and threats of the Regional authorities, and the legitimacy of the Labour Party hierarchy . If they succeed they will also have severely undermined the notion of politics as a matter of professional representation.

Predictions Whilst the poll tax could be stopped it is unlikely that it will be . If the campaign against it should fail the context in which future political struggles will take place will be changed, along with the Scottish economy . The 'service sector' - roughly speaking, mobile financial capital - stands to make the greatest gains through the Unified Business Rate . The smaller businesses, particularly in rural areas will not do well, but their larger competitors will . The commercial sector currently supplies 52% of non-domestic rates - with the reduction of this taxation it will be able to take greater advantage of sites in the areas where labour costs are lowest Labour-controlled inner cities . Property speculators will also receive a windfall . Private lets usually supply a combined rent and rates payment to the owner who is responsible for the rates . Under the poll tax the responsibility for local taxation will fall on each tenant, but no legislation forces the owner to reduce the level of 'rent' charged . For a four-roomed inner city flat in Edinburgh this represents a gain to the owner of approximately £1000 per annum, while the tenants will have to find an additional £800 to E1600 (depending on the number of adults present) . The abolition of the fair rent system in the Housing Act which becomes law this Spring

Capital & Class

32

will remove any chance of redress for the tenant . The poll tax will therefore increase debt, both directly and indirectly - particularly among the young (under-25s), whose rebates when available will be calculated on a lower needs allowance figure . Debt encourages people to take low-paid work or join the black economy . This sort of transient workforce fits comfortably into the labour market which is growing up under Thatchersubcontracting, deskilled labour, selfemployment, even crime, offer a more pragmatic route out of debt than the processes of training and finding employment in a skilled job . Thus, the traditions of initiation into the Labour movement through large organised workplaces are also undermined by the poll tax . The role of local authorities as service providers and, - in theory at least, - as wealth redistributors will be reduced, or removed altogether . The introduction of the Unified Business Rate in 1990 will bring 80 % of local authority spending in Scotland under central government control . In addition, curbs will be made on specific areas of spending such as council housing, through 'ringfencing' and the reduction of the rate fund subsidy . The only remaining source of local authority income will be the poll tax any increase in this, on a proportional basis, has severest effect on those whom a Labour local authority would wish to support . These people are also most likely to default on their poll tax bill, leading to further increases in charge rates the following year . Following this scenario, the Labour local authority would have no alternative but to implement the sort of spending regimes that central government provides for . Local councils would thus become little more than a branch of the civil service . Sections of the Labour Party, however, see control of local authorities as a stepping stone to national government - both person-

ally, and for the Labour movement . The Labour Coordinating Committee which dominates the Scottish Executive and most of the metropolitan councils, is of this persuasion . An alternative strategy they might follow is suggested by the example of Sheffield metropolitan council . Under ratecapping penalties they have begun to follow a strategy of 'inner city partnership' with private enterprise . This would appear to be the only way in which extra cash could be generated - through the supply of enterprise zone concessions, beanos such as the World Student Games, and PR amongst multinationals . Glasgow District Council has already gained Scottish Office favour by following a similar road . However, who the senior partner in such schemes is is open to question - in Sheffield the Council's Low Pay Project devotes most of its attention to workers in large commercial developments such as the Crystal Pears shopping centre, which have been attracted through the partnership policy . Small scale, politically attractive projects are also feasible under such a set up community businesses', 'co-operatives', enterprise boards' and the like . However, these are largely cosmetic - the reduction of local authority budgets will mean job losses . Initial spending cuts under rate-capping have been covered through not filling vacancies arising and the use of short-term contracts . This has mainly affected manual labour - in Edinburgh Dc (the most heavily penalised Scottish Council) the lower grades in the Direct Labour Organisation, Cleansing and Recreation Departments have been those which have taken most of the cuts . Under the poll tax cutbacks and compulsory tendering will penetrate to the white collar grades where the strength of NALGO lies . The NALCO branches in each Scottish Region have agreed to co-operate with the Regional council on the poll tax . In Lothian the resolution passed states this is 'in the best

The Poll Tax interests of our members' (NALGO Matters, 12/87) . Under the poll tax, however, NALGO members will find their workloads increasing and their job security decreasing . The strong ties between the officials of the union and the regional authorities through the Labour Party will be tested by unofficial disputes caused by working conditions in areas such as education and social work if not by the job freezes themselves . The levels of militancy among the currently passive membership will rise . The quality of services provided by the Regional Council will also fall . For a council tenant or a parent in a Scottish city the Labour local authority is very much a part of the way things are . The Council is seen as a bureaucracy of officials ; the councillors as ornamentation . The surveillance and harassment caused by the collection of the poll tax will confirm this view . Protest against the way things are will in the short term favour the SNP, for example in the Regional elections in May 1989 one month after the first poll tax bills are issued . However, the Nationalists don't have the organisational support that the unions provide the Labour Party with . Labour hegemony will be challenged only indirectly, via employees actions, tenant and community campaigns . It is possible that these will coincide to produce something similar to the 'Winter of Discontent' in some Regions . It is unlikely that the Labour groups are going to be astute or courageous enough to back such protests, so the Tories may be able to encourage support for moves which appear to increase local autonomy and service provision - such as the proposals of Scottish Homes, Business in the Community, and other such agencies which are being granted conspicuous amounts of government money . Such alternatives will certainly be much more appreciated in the context of underfunded and defensive local authorities . C&C 37-C

Conclusion In the future under the poll tax fewer services and fewer jobs will be provided by local authorities . In Scotland the local authorities are the biggest urban employers . High skilled unemployment and reduced business costs will encourage capital particularly finance capital - to operate in the inner cities . The poll tax will therefore speed the transition of Britain towards the service economy which Thatcherite interests desire . Tragically, this change will be administered by institutions which have been created by the working class .

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Capital & Class 34

Rethinking

MARXISM

a journal of political economy and social analysis VOLUME 1, NUMBER

3 (FAr,1.1 988)

Bruce Norton The Power Axis : Bowles, Gordon, and Weisskopfs Theory of Postwar U .S . Accumulation Samuel Bowles, David Gordon & Thomas Weisskopf Social Institutions, Interests, and the Empirical Analysis of Accumulation : A Reply to Bruce Norton Doris Y . Kadish New Marxist Criticism and the New Novel: The Example of Claude Simon Alain Lipietz Building an Alternative Movement in France Duncan Kennedy Radical Intellectuals in American Culture and Politics, or My Talk at the Gramsci Institute Elizabeth Oakes Grenada under Occupation : U .S . Economic Policy, 1983-87 Reviews, artwork, and poetry

VOLUME 1, NUMBER 4 (WINTER

1988)

R . G . Davis Music From the Left Sheila Rowbotham Rosalyn Baxandall's Words on Fire David F . Ruccio The Merchant of Venice, or Marxism in the Mathematical Mode Charles Bernstein A View from Nowhere and other poetry Carl Freedman & Neil Lazarus The Mandarin Marxism of Theodor Adorno Robert Gwathmey A Pictorial Celebration and Commemoration John Roche Value, Money, and Crisis in the . First Part of Capital Dean J. Saitta Marxism, Prehistory, and Primitive Communism Reviews and artwork

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Rethinking MARXISM, PO Box 85, Newton Centre, MA 02159

Alan Clarke and Allan Cochrane Inside the machine : The left and finance professionals in Local Government • LOCAL GOVERNMENT spending in the UK has been an issue of political controversy at least since the mid 1970s, and the sharpness of the debate around it has increased noticeably since the election of the Thatcher government in 1979 . In most of the academic writing about the conflict there has been a more or less consensual position, shared by marxist and non-marxist alike, that a process of centralisation was under way which was undermining the operation of local democracy (see, e .g ., Duncan and Goodwin, 1988 Ch . 5 for a relatively sophisticated version of this argument), and, as a result, many academics saw their main task as defending the councils apparently under threat (see, e .g ., Jones and Stewart, 1984 and SAUS, 1983) . The nature of this 'local democracy' was sometimes questioned a little, but in general it was presented as being relatively unproblematic . According to Saunders the central state concerned itself with production issues and was dominated by corporate forms of politics, whilst the local state concerned itself primarily with issues of collective or social consumption and was dominated by pluralist forms of politics (Saunders, 1982 and Saunders, 1984, pp . 30-32) . In this paper we want to come at the question of local government in a time of fiscal stress from rather a different direction . The dominant approaches seem to us to make it more difficult to understand the political processes involved, because they generally forget about or ignore the importance of professional politics, negotiation and bargaining between groups within local authorities

The authors argue that the left 'has underestimated the significance of the treasurer in local authorities', the authors warn against the lure of 'creative' accounting .

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and across levels of government . This paper focuses on the experience of one group of councils - those controlled by the Labour Party left in attempting to deal with a changing set of financial and legal rules in the first half of the 1980s . It focuses on them because they appeared for a short time to represent some alternative to the policies of the centre, and because their experience illustrates quite graphically the difficulty of escaping from the rules of the game, not only as laid down by the legislation of the centre, but also - more subtly, yet more certainly - by the common sense of local government, particularly as expressed through systems of financial control . The arguments developed below arise principally from the experience of councils controlled by the left . But similar conclusions could be drawn from a consideration of a wider range of local authorities : the point here is that councils which began with radical ambitions were just as forcefully drawn back into the mainstream as those which never tried to escape . The attempt to work 'in and against the state' was undermined not only by the imposition of draconian powers by the centre (although, of course, there were important legislative changes in the early 1980s) but, equally important, by the processes of negotiating reality within local government . Approaches which start from the 'localness' of local government will underestimate the significance of other structuring factors and make it difficult to understand local government as part of a wider (capitalist) state system .

The left in local government

The discussion of local government on the left - even Gyford's 'new urban left' - is still generally approached through the prism of electoral politics . However much it is formally acknowledged that the operations of the state cannot simply be understood through the results of elections or in terms of the successes of different political parties, the dominant assumption is still that changing the party in power can make dramatic differences . Within the Labour Party activists manoeuvre obsessively to ensure the victory of this faction or that in the local Labour Group . Whoever wins, it is assumed that they will have, or be able to win, control of the state machine and so be able to implement their programme through it . Although there is also a widespread belief that officers are resistant to radical initiatives, their importance in setting the political agenda of what goes on inside that machine is rarely recognised . There is little understanding that political debates and political bargaining take place within the 'machine' as well as in the council chamber, committee rooms and party meetings . In the 1970s attempts were made to develop more critical analyses of the local state (including, e .g . Benington, 1976, Cockburn, 1977, Community Development Project, 1977, Friend

Inside the machine

and Metcalf, 1981, London-Edinburgh Weekend Return Group, 1979) . All of these argued that the orthodox - Fabian or socialdemocratic - analysis of the welfare state as another step in the inevitable upward progress towards socialism was fundamentally mistaken . They highlighted the contradictory gains of welfarism, with its offer of additional financial resources coupled with an apparatus of control and supervision : 'Resources we need,' it was said, 'involve us in relations we don't' (London-Edinburgh Weekend Return Group, 1979, p. 26) . The state was explicitly described and understood as a capitalist state, whose task was to, 'reproduce the conditions within which capitalist reproduction can take place' (Cockburn, 1977, p . 51) . It was analysed as a set of relations, rather than a machine which could be captured . Cockburn was particularly scathing about those who believed that the vehicle of the local state was 'obediently in the command of whoever sits in the electoral driver's seat, and that when Labour does so, the people do so' (Cockburn, 1977, p . 2) . Yet at the same time these analyses held out hope for subverting the operations of the state and offering new ways forward because the local state was perceived as a battleground between classes and interests . 'Capital needs our participation, yet we use these openings in a way that can threaten capital' (Cockburn, 1977, p . 184) . It was possible to work 'in and against the state' . These writings, however, only represented the first steps into a complex and confusing new arena of debate, whose political implications were relatively unexplored . The main criticism made of Cockburn's approach, for example, was that it was excessively 'functionalist', in explaining the changing nature of the 'local state' as stemming from its (necessary) role within capitalism (see, e .g . Duncan and Goodwin, 1982) . Yet the main message drawn from all these texts was not one of fatalism, nor of a crude anti-statism, as might have been expected from such criticisms . Instead, the message was that there were opportunities for autonomous action by groups within and 'client' groups outside the state machine which could point towards alternative ways of organising society . Instead of believing that the state was an institution which could only be transformed by full frontal assault - an approach often caricatured as the Leninist one - they argued that what was needed was a multiplicity of campaigns, of 'counter-organisation' . 'Because the state is a form of relations, its workers and clients, if they do not struggle against it, help to perpetuate it . . . Our struggle against it must be a continual one, changing shape as the struggle itself, and the state's response to it, create new opportunities' (LondonEdinburgh Weekend Return Group, 1979, pp . 48-49) . similar points were made by Rowbotham et al. (1979), and the idea of prefigurative struggles was widely taken up . Although there were sometimes broad comparisons with Third

37

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World guerrilla struggles, it was never quite clear when this multitude of interventions would stop the state being a capitalist state . Nor was it apparent how (except by their own force of will) activists would be able to escape from having their activities defined by the state-determined rules of the game within which they operated . It was possible to provide examples, but not guidelines . This became a problem when the 'new urban left' was called on to move from theory - and opposition - to practice - and government . In the early 1980s, with Thatcher in power nationally, new Labour groups came to power in local councils up and down the country . Many of the new councillors and their supporters in the Labour Party had been influenced by these ideas, although they had developed outside the party . Through the 1970s and into the early 1980s there had been a shift of radical and community activists of one sort or another into the Labour Party, and they began to develop alliances with some on the Labour Party left who were also looking for alternatives to past practices (see, e .g . Boddy and Fudge, 1984 pp . 4-9, Green, 1987 pp . 204-208, Gyford, 1985 Ch . 2, Wainwright, 1987 Ch . 3). Although not all of the newly elected Labour councils can be associated with a shift to the left, the extent to which this happened made it possible to identify a limited number of councils (including, for example, several London Boroughs, the Greater London Council, Sheffield, and, for a time, Edinburgh) as part of a wider movement - of local socialism, or a new municipal socialism . The supporters, and some of the authors, of the new ideas soon got the chance to try them out when they were given posts as political advisers and specialist officers within the machine . Ironically, this meant that some of the proposals outlined in the documents of the late 1970s had to be turned on their heads . These, by implication, had assumed a continued political dominance of Labour councils by the right or an inability by left councillors to avoid being drawn into the management of local government on capitalist terms, so that they would effectively become indistinguishable from the right (see, e .g ., Cockburn, 1977, pp . 170-172) . As a result, they were principally concerned with looking at ways in which Labour minorities and socialist officers might build alliances and working practices inside and outside the council which could begin to challenge the normal operations of the local state . But now the left was in power and making demands of its officers, particularly at the service delivery end . In 1979 it was argued : 'We (state employees) are implicated in the imposition of capital's social relations . Without oppositional action, we actively perpetuate and recreate a capitalist and sexist and unequal society, not merely by default but through all that we do . We may not make many of the important, top-level decisions or wield any of the serious sanctions . But in a practical dayto-day sense, state workers are the state' (London-Edinburgh



Inside the machine 39

Weekend Return Group, 1979 p . 49) . By the early 1980s, this had become the orthodoxy in a number of left local authorities, not for the employees but for the formal employers, and 'state workers' were expected to carry the message of the new society to the 'clients', consumers' and 'communities' . The experience helped to raise new questions about the nature of the local government, but in practice it also helped to shift the debate back to the old one about how best to control/manage the machine . Even critical assessments of the experience seem to focus on ways of getting the machine to work better for the political leadership, whether that is assumed to include the new officers or just the councillors (see, e .g . Mackintosh and Wainwright, 1987 which uneasily mixes echoes of the legacy of the 1970s with the reality of the 1980s) . One commentator from the 'new right' perceptively notes that pessimism about being able to take over the capitalist state at local level was replaced with a faith that 'the state (local government) can be taken over and manipulated' (Walker, 1983, p . 103) . He presents this as a 'split' within the local left, but it seems to have been pretty much universal . The orientation of being 'in and against the state' provided a way in for the more libertarian left, but it also led them inperceptibly into shifting the debate towards arguments about making the state work more effectively as a machine, for labour or women or other oppressed groups . Paradoxically, despite a theoretical understanding that the structure of local government is not simply a neutral machine which can be steered in whatever direction the politicians choose, in practice it is still largely viewed as a machine which can in the end be steered if enough pressure is brought to bear . An emphasis is placed on the importance of political will .

The left had no hesitation in attacking some elements of the 'machine' which it had inherited . The attempt to fight cuts imposed from the centre encouraged some activists and councillors to question the nature of local services and structures of service provision . And it was acknowledged that without some changes it would be difficult to generate and mobilise support, since the operation of councils was often seen to be oppressive and incompetent by those they were supposed to serve . The new policies started from the need to challenge existing sources of professional and bureaucratic power . There was sharp criticism of the ways in which local government organised its services, because of the power of professionals within it . Hoggett, for example, has argued that, 'Departmental empirebuilding has run riot . Elite groups of professionals have been given a free hand, both to define need and how it shall be met . Work has been fragmented into ever more specialist and particular forms'

Ghosts in the machine

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40

(Hoggett, 1987a p . 32) . But the nature of the challenge still implied a view of the local state as a machine which could be shifted this way or that, depending on the determination of councillors . The decisionmaking structure of the state introducing these reforms was still assumed to be a hierarchy not unlike that assumed by more traditional councillors (and many local government textbooks) . Change was expected to flow from decisions taken at the top, arising from central decisions made by councillors in committee, even if these were often justified in terms of decisions taken by the District Labour Party or promises set out in local election manifestos . They were to be implemented through new committees, units and departments . The politics were different, but the machine remained, even if it was now described as a set of relations rather than simply an institution . Hoggett acknowledges that one of the weaknesses of the left in local government is that 'we . . . have never given much thought to how we run things' (Hoggett, 1987a p. 32) and he draws on the negative experience of some (generally unnamed) authorities to illustrate some of the failures of the past . He looks to the decentralisation policies of Islington and Walsall (in the early 1980s) to show some of the ways in which change can be achieved . Decentralisation is viewed as a means of undermining professional power and removing unnecessary departmental divisions in localised offices providing a range of services . It is not appropriate to consider the successes and failures of decentralisation in any detail here . But the underlying arguments are important in indicating how the local authority left looks at organisational and professional politics within local government . And they help to show why the leading councillors (and officers) of the left in power responded to the pressures of financial constraint as they did . Even the proposals for radical decentralisation show how the new' left remains trapped in a view of the local state which is not dissimilar to the one taken by the Labour politicians whom they replaced, without any clear understanding of the intra-organisational politics which help to determine the shape taken by socialist politics as they are translated into local government policies, whatever they look like in party manifestos . It is acknowledged that state professionals and the bureaucracies within which they operate represent a powerful force within the state . Indeed it seems to have become fashionable to give them a very high status in the left-wing demonology, as Hoggett's arguments suggest (see, e .g ., Block, 1980 for an extreme form of this in which state managers achieve parity with the capitalist class) . But the left still seems to start with a remarkably undifferentiated view of their role, with little concern for tensions within them and between different sectors . They are perceived at one level as almost monolithic obstacles to radical

Inside the machine reforms introduced from above . In some sense professional divisions are simply understood as irrational obstacle to reform . Yet at the same time there is a feeling that individual officers may operate as allies, whether brought in from outside, or already at senior levels within the council . There seems to be little consideration of the structural relationships within which they have to act (see, e .g ., Dunleavy, 1985 for a discussion of the importance of this) . It is accepted that there will be opposition from existing professionals and a conservative bureaucracy resistant to change, but it is also assumed that this opposition can be overcome if only there is sufficient political will . In practice, this has meant that trade unions - particularly white collar unions - are often seen as an important part of this professional conservatism, defending their own relatively privileged position at the expense of their members' 'clients' (see, e .g ., Weinstein, 1986) . And in practice, too, it encourages the development of equally important, if unspoken, alliances between leading - left - politicians and senior officers . Certainly a genuine step forward has been taken from the 'good old days' of what Gyford (1985) calls municipal labourism . That was marked by a formal division of labour between senior politicians (committee chairs) and departmental chief officers, which in practice meant that politicians left the chief officers to get on with decisions about what services should be delivered, and how they should be delivered . Councillors were expected to offer them the necessary financial and political support . This division of labour effectively represented an alliance between the chief officers and Labour councillors based on the view that the job of politicians was to appoint the best officers and then let them get on with their jobs . The new division of labour implies a closer set of relations in which the elite which makes decisions - including budgetary decisions includes leading politicians as full members . But there is little understanding that a range of ideas may also be generated within the 'machine', and that whatever comes from 'above' - from councillors and council committees - is also always being reinterpreted in terms of those existing debates . The monolith, however, is not monolithic . In fact some of the 'new' ideas coming from the politicians may themselves arise from or have some resonance with debates within the professions or management . In the case of decentralisation, for example, there has been a substantial debate within management literature about its value as a means of ensuring better management control and greater efficiency, which began long before the idea became popular on the left (some of these early debates are neatly summarised in Cockburn, 1977 Chs 4 and 5 . See also Greenwood, et al ., 1980, Ch . 2) . Despite his general enthusiasm for the strategy, Hoggett also suggests that decentralisation of management may reflect a general trend within capitalist

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organisations rather than simply a response to socialist pressures - 'I feel,' he says, 'that things had come to such a pass in local government that it required radical Labour councillors to show local government's 'managerial layers' what is best for them' (Hoggett, 1987b, p . 224) . The Audit Commission, too, has been sympathetic to the left's decentralisation proposals . In the midst of a series of scathing criticisms of the operation of London's local government, for example, time was found to commend Islington's decentralisation policies (Audit Commission 1987) . As Flynn puts it, 'if the main motivation is to achieve more power for senior managers, by reducing layers of control, then shifting responsibilities down the organisation may be a powerful tool' (Flynn, 1987, p . 44) . The one system which cannot in practice be decentralised, except as a local agency for the central system, is finance . And it remains the key instrument for central control . In the private and now the public sectors decentralisation may be used to identify cost centres which can then be given cash limits (or earnings targets) within which they have to stay . Within local government attempts to devolve financial decision-making usually amount to the local managing of a budget which has been allocated centrally, albeit sometimes with limited provision for local income generation, for example through the variation of fees and charges . Financial devolution at a time of fiscal stress means the devolution of responsibility without an equivalent devolution of power : decentralised decisions take place within centrally determined (and narrow) budgetary constraints . This does not mean that socialist decentralisation is simply the same as the proposals which emanate from management, or the Audit Commission . But it does mean that it cannot be assumed that 'socialist' programmes - particularly in areas such as local government where socialist thinking has been underdeveloped in the past - are totally innocent of the environment within which they are developed . It is misleading to believe that the approaches, even of the local socialists, or new municipal socialists, will be uninfluenced in the practice of implementation by the priorities of the different groups with which they are forced to work . Much of the discussion on the left about professionalism in local government has focused on those actually delivering services, particularly in housing and social services - what Lipsky (1979) calls 'street level bureaucrats' . And this focus is not surprising since it is, of course, housing workers and social workers who are the most public face of local government . To most people, to echo the LondonEdinburgh Weekend Return Group, they are the local state . The tasks they perform, in directly rationing the meagre resources which capitalism is prepared to grant to the poor, are not likely to make them popular with anybody, particularly as much of their work is effectively discretionary, dependent on relations built up with



Inside the machine individual 'clients' as well as resources available from the centre . In the new decentralised offices, among professionals, it is these groups whose work has changed most dramatically . The other layer in the organisational structure which has been most open to attack is the middle layer - the administrators in central departments who filter (and may obscure) messages flowing from top

43

to bottom and back again . The new hierarchies will, it is intended, be flatter, and with the help of information technology communication will actually be more effective . But once one moves away from these sectors the implications of increased central power are rarely effectively explored . There is little consideration of other forms of professional power . Yet it is these other layers, senior management positions within the various service departments, treasurers and others, which set the constraints on what the service deliverers can do on the ground . And it is with these groups that senior councillors, even left Labour councillors, spend most of their time in determining policy, particularly in times of tight financial constraint . The changes which are introduced are usually the product of alliances between senior officers and councillors, however much councillors like to believe that they are simply implementing the lines of their party programmes . There is little discussion with the 'street level bureaucrats' which is not filtered through the perceptions of their superiors .

So far we have concentrated on the politics of the local authority left and have reached some general conclusions about its implications for politics within the local government machine . In order to develop these points further, we need to narrow our focus onto an area of decision-making in which the nature of those politics can be explored . The budgetary process is a crucial area of concern both because budget making is the institutionalised form of bargaining for resources within councils and because it has increasingly also been the arena - particularly for authorities on the left - in which relationships with central government have had the highest profile . It is the agreed budget, with its various sub-headings, which offers the 'rational' basis on which spending is to take place, and often the only formal mechanism for monitoring the incidence of that spending . Lehman and Tinker have in another context discussed accounting as providing 'ritualised methods for resolving conflicts over wealth distribution' (Lehman and Tinker, 1987, p . 517), and that is also a helpful way of viewing the budgetary process and its related monitoring within local government . We shall be concentrating our attention on one particular professional group - treasurers or finance officers - and their role within the wider decision-making process of local governments, highlighting the implications of this for left councils in

The importance of the Treasurer : the power of the `hidden hand'

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particular . 2 This focus should not be taken to imply that this is the only important professional group in local government : on the contrary a full understanding of the political process in local government would involve an exploration of competing professional , rationalities' . Local governments are complex organisations and the balance between departments, professions and councillors will vary between them, but, even allowing for that variation, it is clear that finance departments play an important role in all of them, and the message which they carry with them helps to determine the ways in which decisions are made throughout the organisation . The finance role has been given little serious consideration by the left . Treasurers are either, crudely, seen as 'the enemy', trying to undercut every radical initiative and cut all spending, or are ignored as if they were simply part of the external environment in which radical policy making has to take place . More recently, a love-hate relationship seems to have developed, in which they are both seen as carriers of the message of 'sound finance' (i .e . cuts) and as technical experts, whose mastery of complex financial rules and arrangements may enable councils to escape from the consequences of cuts imposed by central government . Treasurers have always had a central position in modern British local government . Their professional organisation (the Chartered Institute of Public Finance and Accountancy) (cIPFA) celebrated its centenary in 1985, having been founded as the Institute of Municipal Treasurers and Accountants . Treasurers, along with legal officers, represent the vision of traditional local government, more concerned with the protection of the ratepayer (their 'fiduciary duty'), financial discipline and the avoidance of overspending than with the provision of services . The profession's own organisations, such as CIPFA and the various organisations representing chief finance officers, help to construct a unified image, partly because they bring together education, recognition, and guidelines on accounting methods . In the 1960s and 1970s the dominant penny-pinching role of the traditional treasurer was not of particular relevance to most local authorities, since spending was rising inexorably across the board . Nor was there much need to find new sources of finance, or to evade financial restrictions . Councils were being given more and more responsibilities and the 1972 Local Government Act, whatever else it did, seemed intent on increasing spending still further . This was a time when finance officers generally took a background role . They were still members of the central management teams, but the chief officer whose importance grew was the chief executive, often with a legal (and sometimes management) rather than a finance background . There were also numerous attempts to develop forms of budget construction based on managerial objectives rather than financial aggregation . These were the years of 'corporate planning', even if

Inside the machine

what that meant in practice tended to vary dramatically between authorities . In understanding the role which finance professionals have come to play in left local authorities, it is important to note their relative independence, organised through bodies such as CIPFA . Whilst licensed, in some sense, by the state to undertake certain functions, public sector accountants are not simply creatures of the state . As Wilmott notes, 'professional associations are primarily, but not exclusively, political bodies whose purpose is to define, organise, secure and advance the interests of their (most vocal and influential) members' (Wilmott, 1986, p . 556) . The relative independence of these organisations means that they do not simply reflect demands from above, as expressed in central government legislation, but sometimes suggest means by which the impact of the legislation can be minimised, although Rosenberg (1989, Ch . 5) quotes one treasurer who claims that, 'Quite a lot of professionals I think would be perfectly happy to be an extended arm of Whitehall . Their professional perception of their role is comparatively clear and I think they could accept the disappearance of the local political input with almost total equanimity' . In general, however, members of the profession value their independence, and have come to realise that it depends on their position within local government . The same treasurer went on to comment that 'Among Treasurers there has been a certain politicisation of their roles and an increased consciousness that they help to defend local government . Treasurers' strongest alliances are inside local government rather than outside' (Rosenberg, 1989, Ch . 5) . In stressing their independence, of course, they reflect the wider private sector accountancy profession, for example in its commitment to explore ways of avoiding the payment of tax . They have prepared guidelines for presenting the accounts of trading organisations in such a way that, admittedly within tight constraints, it is still possible for councils to adapt them, despite hostile government legislation . In the case of direct labour building organisations CIPFA itself recommended to the government that they should be accounted for separately (as trading organisations) . When this was enacted in the Local Government Planning and Land Act (1980) it seemed virtually to outlaw the operation of OLOS, but CIPFA proceeded to develop a voluntary code of practice for presenting their accounts which opened up opportunities for their survival, and this code was effectively accepted by the Department of the Environment (see Hepworth, 1984, pp . 188-196) . In other words, the professional organisations confirm the role of treasurers more generally - they encourage them to operate as a means of searching for technical rather than political solutions to financial problems . Treasurers gain professional recognition for their ability both to manipulate central rules and the financial

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market to the benefit of their authorities, and for their ability to encourage those authorities in the ways of careful financial control (see also e .g . Sbragia 1984 for a discussion of the operation of local authority treasurers in the capital markets) . In years of expansion as well as in years of tight control, finance officers continued to set the budgetary rules according to which everybody else played the game . Of course, individual departments, chief officers and councillors often see themselves as equally adept at playing this game, able to win concessions for their own spending areas . But the game itself is always played according to the financial rules of the treasurers - in terms of debates about costing and budgets rather than the expressed needs of particular groups or communities . At times Treasurers may exaggerate their own powers, for example, in suggesting, as one has done, that financial regulations within local authorities 'provide 'a written set of rules with which the Chief Financial Officer can discipline his fellow Chief Officers and ensure the purity of financial administration' (Harbord, 1984, p . 178) . They are highly susceptible to the notion that local governments exist primarily so that they can engage in accounting . But in all the authorities we visited it was also clear that alone among chief officers they were more concerned with the game than its service outcomes . They liked to present themselves as being aware of the tricks their colleagues got up to, and dealing with them with a form of amused toleration . In general, budgets vary from year to year, not on the basis of a political appeal to groups outside the council, but on the basis of incremental changes to global budgets agreed in the past . Despite the various consultation exercises undertaken by councils (left and right) the actual processes of financial decision-making remain hidden within the deepest recesses of the bureaucracy . Before turning to some of the particular problems this poses for the left, it is important to understand the all-pervasive, unspoken and frequently unacknowledged influence of the treasury in most local authorities, and some of the reasons for it . In a sense the influence of accounting practice is taken so much for granted that no-one notices it any more, and it is rarely challenged because it is simply part of the environment within which decisions are made and policies are shaped . It is worth considering just how this is reinforced by the normal activity of finance officers in local government . Covaleski and Dirsmith neatly sum up Hopwood in this context : 'accounting derives much of its force from its blandness . To the extent that it seems to be trivial and dull, we take its ostensibly routine support of rationality for granted' (Covaleski and Dirsmith, 1988, p . 4) . Nowhere is that more true than in the field of local government . In large part finance departments present themselves to the rest of their authorities as 'natural' parts of the organisation through the regular operation of administrative technicalities . This perspective is



Inside the machine built up from the myriad routine contacts which quite junior staff within the finance department have with other departments . These are concerned with correct invoicing procedures, purchasing procedures and internal audit systems . They are accepted both as necessary - to keep an ever watchful eye on the authority - and unchallenging - in many councils we visited they are undertaken by members of service departments themselves, although they are always correlated and checked by officers in the treasury . These routines create an anvironment within which financial measures are seen as normal practice and the 'objective' monitoring of the organisation using financial measures is not seen as unreasonable - indeed is presented as evidence of its 'rationality' . In many authorities the treasurer's department has been given responsibility for the development of computer applications both because computers are associated with the manipulation of figures - assumed to be an almost 'natural' responsibility of treasurers - and because it makes it easier rapidly to monitor the progress of departmental budgets . One consequence of this is that treasurers often have access to information which other chief officers, including chief executives, do not . At its simplest this means that they play a large part in determining what information is judged to be relevant, which gives them significant power within the system, because, as Rosenberg notes, 'information is power in local government organisations' (Rosenberg, 1989, Ch . 8) . The extent to which they are aware of this power or consciously use it is more open to question . In the authorities we visited, with one possible exception, it was accepted both by the treasurers and other chief officers that the role of the treasurer was more that of a mediator or power-broker than that of a dictator (or potential dictator) (see also Rosenberg, et al ., 1982), but, of course, the ease with which that position is granted to the treasurer may reflect his acknowledged sources of power . Another, and potentially more significant, consequence may be that the process of accounting in local government effectively defines the 'reality' of that local government in such a way that active political intervention by the treasurer is not required . Indeed, it makes it possible, as Rosenberg, et al . (1982) point out and our research confirms, for the treasurer to appear as mediator or broker between competing interests, despite (or perhaps because of) having set up the conditions for conflict in the first place . In recent years, the finance profession has become increasingly important throughout local government, in councils of all shades of political opinion . Perhaps that is not so surprising . It is hardly necessary to list the various methods used by Labour and Conservative governments to cut local authority spending : from reductions in rate support grant, to cash limits and rate-capping . Through its

47

The changing financial and institutional context

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sponsorship of the Audit Commission, the Thatcher government has attempted to reinforce the 'value for money' ideology which it understands to be carried by the accountancy profession (see, e .g . McSweeney, 1988, pp . 29-31) . The cumulative effect of these policies has been clear enough - real cuts in council spending, although not as great as the government would like, in the face of increased demands for local authority services ; a shift in the sources of funding from central grants to local rates, increased rents and even increased charges ; proposals for a poll tax ('community charge') and a uniform business rate ; and an increasingly desperate search for new financial and accountancy schemes ('creative accounting') in local authorities to evade the rules of the centre . An almost impenetrable mystique has grown up around the rate support and block grant systems - indeed, the frequency with which we were told it suggests that every treasurer has the same favourite joke, namely that only two people ever really understood the system, he - despite an increased feminisation at lower levels in recent years (see Crompton and Sanderson, 1986) chief finance officers are almost invariably male - is one and the other is now in a mental hospital . The ever changing legal framework of local government finance, coupled with the increasing confusion surrounding the rules on grant allocation from the centre, reinforce the 'technical' expertise of treasurers and also make it formally necessary for politicians to consult treasurers on the legality of their actions . Of course, this does not mean that councillors or councils are simply tools of treasurers' departments, reliant on them for permission before they act on any issue . But it does mean that the atmosphere within which proposals are discussed is dominated by a language and ritual which is alien to the development of socialist initiatives, and almost incomprehensible not only to most of the local population, but also to most of the councillors taking part in the debates . It encourages the development of a relatively small elite in every controlling group which has access to and understands the financial debates, before handing down the budgets to other committees and departments . In many cases this is actually reinforced by attempts to bring more financial information to councillors, because the mass of detail confirms the expertise of the elite which continues to dominate debate in committees and Labour Groups . The dependence of even the most left-wing council on its treasurer is clear . The interpretation of central government intentions can be cast in such a way as to allow or deny the opportunity for schemes to be developed . The flexibility which can be built into the tightest budget cycle by this interpretation can be as much as £5m, in a budget of £200m, without too much effort and £5m can be the money required for a party's growth items . There is rarely any direct conflict between treasurers and leading politicians . They are able to

Inside the machine reinforce each others position : treasurers offer solutions to apparently insoluble problems, by squaring the circle of cuts in government grant and increased demand for services ; while council leaders are able to offer support to detailed financial scrutiny of departmental spending budgets . One of the reasons why the centrally organised grant system has fallen into greater and greater disrepute is that it has not achieved the ends set for it : indeed it has managed to combine a feeling of severe financial constraint within local authorities without producing the hoped-for cuts in practice . Gibson and Travers, (1986) comment that 'the most important result of the block grant has been to lead the government to perceive weaknesses in the structure of local government finance based on the rating system and to put forward a new system' (p . 32) . The extent to which the community charge (or 'poll tax') can be expected to change this remains open to question, particularly since the proportion of local spending financed by central grant will actually increase dramatically because the centre will be responsible for the distribution of the proceeds of the uniform business rate, and central controls will still limit the local levels of the new tax . In the past the grant system has succeeded in allowing local authorities to blame the centre for any problems they face . It has, says the Audit Commission, blurred local accountability and not only failed to provide incentives to reduce costs, but actually provided some of its own to increase them . With all its various controls it has actually made it more difficult to manage local government finance from the centre, because it has encouraged councils to manipulate the information supplied to maximise actual spending, while minimising spending which is penalised (Audit Commission, 1984, pp . 47-56) . And, of course, treasurers have played a major role in this manipulation . Spending has not been based on 'rational' criteria but on the need to comply - or appear to comply - with the latest legislation . The government itself has encouraged the growth of creative accounting' . The treasurer's advisory role on the external situation and the workings of the local government finance system has confirmed the power of the finance department . There is now such a complex array of decisions, revisions and changes to the central government support for a local authority that for much of the year budgetary planning is made on the basis of the treasurer's 'best guess' . There are obviously difficulties in a system which means that the original estimate of central support can be as much as one-tenth of the total budget away from the figure which is finally delivered, either positively or negatively . The treasurer's advice on budgetary planning becomes a crucial element in decisions about the redistribution of funds within the authority and the allocation of uncommitted growth . So an increased role for finance departments and the methods of C&C 37-D

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accountancy can be seen to be a more or less direct consequence of the policies of central government . Among our authorities, the dominance of financial criteria in political debate was clearest in those which were controlled by the same party as in power at national level, and this was particularly noticeable in the traditional shire county which we studied, where great emphasis was placed on savings and income generation . But the language of financial control has also been carried effectively to other councils, reinforcing the position of the treasurer . In all the authorities a close relationship has developed between the council leader, chair of the finance committee and treasurer . In some, although not all, it seems to have been more significant than the links with their chief executives, who one might have expected to be the central policy links between members and officers (see Tomkins, 1982 which seem to confirm this trend) . Clapham (1983) has shown how corporate planning actually lost its significance in the face of cuts, and one Treasurer interviewed by us argued that if he had not been able to increase his importance and the importance of his department at a time of severe financial restraint then he did not deserve to remain in post . Noel Hepworth, Director of the Chartered Institute of Public Finance and Accountancy, made the position clear quite early on, with the rather self-satisfied comment that, 'A halt to growth means that the only way of meeting new marginal needs is to review the distribution of existing resources . To that extent such a change can have beneficial purgative effects . And on the whole this is what has happened in local government' (Hepworth, 1980, p . 13) . In general treasurers have been eagerly on hand to provide the necessary purgative . Where the position of the chief executive has been developed further, it seems to have been in partnership with the treasurer, or by developing a role similar to that of the treasurer, focusing on the provision of legal advice and financial management . In one inner city authority, the role which one might normally have expected to be taken by the treasurer was taken by the chief executive, and the treasurer played a more subordinate, supporting, role . In part this reflected the relative (political) inexperience of the treasurer who took over rather unexpectedly, but it also highlights a trend towards a wider role for a central chief officer - whether chief executive or treasurer - able to bring together financial and management control . In this case that is being undertaken by the chief executive, elsewhere there is a closer partnership between treasurer and chief executive . In the last few years the pressure has been on to move beyond the traditional limited - financial control - function of the local authority treasurer, and this has been encouraged by the atmosphere of cuts and financial constraint . Pendlebury, for example, has stressed the need to encourage the use of management accountancy methods in local government - including further attempts to 'predetermine costs for

Inside the machine use as targets or standards against which output could be measured' (Pendlebury, 1985, p . 65) . Pendlebury echoes the Audit Commission's desire to achieve and monitor the 'economy, efficiency and effectiveness' of local authority spending, and sees a major role for treasurers in developing means of identifying measures of usage or activity as 'a starting point in widening the scope of budgetary control' (p . 65) . Moves in this direction, despite government pressure, have, however, been limited, mainly because they threaten the independence of other departments, even if they may themselves use similar methods internally, but also because defining the terms in which the three 'E's can be measured has remained elusive . The focus remains overwhelmingly at the level of identifying means of adjusting budgets to meet financial targets, because it remains the only politically acceptable basis for negotiation between departments inside the machine .

The centrality of the financial control function to the policy process has not just come from a desire (or need) to control spending levels . Within the increasingly complex world of local government finance and implicit negotiation with central government, treasurers also offered lifelines especially to left wing authorities . Here their professional role as independent 'experts' has been particularly important and within the profession the skill shown in evading government controls has been a measure of success at least for some treasurers . Liverpool's Treasurer was particularly ingenious in developing legal schemes for avoiding the financial crunch (Parkinson, 1986, Reddington, 1986) . In 1985 'creative accounting' was presented as the 'realistic' left's way out of the debacle over the ratecapping campaign - a way of avoiding the surcharges which faced councillors in Lambeth and Liverpool, while maintaining the 'dented shield' favoured by Neil Kinnock . Instead of being kept in decent obscurity behind the closed doors of treasurer's departments, the 'new' accounting methods were unveiled publicly so that activists could understand and endorse the cleverness of their leaders (see, e .g ., outlines of creative accounting methods presented by the Association of London Authorities, 1986, pp . 6-8 ; and the Local Government Information Unit, Douglas and Lord, 1986, pp . 38-39) . There are two main forms of 'creative accounting' in local government . The first manipulates the central government rules to maximise grant revenue and the second seeks to increase expenditure this year at the cost of interest repayments in later years . Both have similar political implications for the left, insofar as they reinforce the idea of expert intervention as a solution to financial problems, although the second has had more significant long-term consequences . The first is normal practice throughout the local government system -

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The trap closes : the lure of 'creative accountancy'

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in authorities from the left and the right . Treasurers gain great respect within the profession from discovering new loopholes which allow their councils to increase their spending power by beating the government's penalties . The second is controversial within the profession, and is generally only adopted in authorities controlled by the left, although in the 1970s lease-lease back schemes were relatively common for industrial and commercial property schemes . The impact of the more developed schemes has been quite dramatic . According to the Audit Commission one result of their use has been that 'large parts of London appear set on . . . a course which will lead to financial and management breakdown' (Audit Commission, 1987, p . 4) . And this has largely been confirmed by those who engaged in it, even if they blame central government for making it necessary . In New Socialist, for example, Margaret Hodge (Leader of Islington) acknowledged that the strategy of 'creative accounting' was likely to lead to a financial crisis in 1989-90 and begged for assistance from a hard-hearted Labour front-bench which she hoped would become the government later in the year (Hodge, 1987, pp . 36-37). In fact the return of another Thatcher government in 1987 seems to have brought the crisis a year earlier, into the 1988-89 budget year, with initial cuts being made in 1987, so that still deeper cuts of up to one-quarter of overall budgets could be made in the following year, and little hope of much relief in the future . The search for an annual rabbit to be produced out of the hat strengthened the links between treasurers and left councillors dramatically in the early 1980s, to the extent that 'creative accounting' became a topic of political as well as professional discussion, at least among Labour Party activists . Such an approach to the politics of budgeting, however, was difficult to develop as a means of mobilising people outside the council chamber . It effectively reinforced the politics of the town hall at just the time when the councils claimed to be trying to undermine those approaches . The debacle of the campaign against rate-capping in 1984-5 seems to confirm that . Having announced that they could not survive under rate-capping without making massive cuts, all of a sudden one after another most of the councils, apart from Lambeth and Liverpool, suddenly revealed that they could in fact - with a judicious bit of financial juggling - manage to bridge the previously unbridgeable gaps . In the end even Lambeth and Liverpool, having been surcharged, revealed that they had managed to survive rate-capping without making cuts . The purpose of this brief reconsideration of a painful political defeat is not to argue that there should have been no struggle against the new legislation, but to illustrate the inherent weakness of a campaign which started out from a statement of budgetary constraints and then collapsed as the range of immediate

Inside the machine possibilities and escape routes became clearer, even if they were sometimes buried in predictions of 'deficit budgets' which never actually materialised (for a more sympathetic discussion of the campaign, see Blunkett and Jackson, 1987, Ch . 8) . It clearly was possible for most of these councils to make legal budgets without cuts in 1984-85, although the meaning of the 'no cuts' position was stretched to breaking point in some cases . But by turning that into the central issue the councils effectively moved away from the broader issues of the campaign, which was not about whether a budget could be made in one particular year, but about the longer term impact of the new legislation on the local welfare state and the scope to mobilise resistance to the centre . By accepting the rules of the game and 'creative accounting' in 1984-85, the left was merely setting itself up for political defeat then, accompanied by long-term debts and the promise of massive cuts in 1987, 1988 and 1989 . Although the campaign started off by stretching them, it never managed to escape from the parameters laid down by the definitions of the possible enshrined in the professional practice of local government treasurers . Despite the rhetoric, the political alliance developed in 1985 was not between local communities and Labour councils, but between councillors and chief officers trapped in the traditional languages of local government . Maybe the surprise is that traditional definitions were stretched at all . Each year politicians and treasurers promised that this was the last year the tricks could be performed . Next year was always the year of confrontation when everybody needed to be mobilised . Yet each year until 1987 they claimed to pull it off again . In fact, the budgetary process increasingly looked like a strange political game, with little relevance to the state of services or local politics . First, in January, or earlier if the finance department could get the figures together, the scale of the problem was announced - there was a 'gap' of many million pounds between funds available and spending targets . This gap was said to be unbridgeable . The authority was in crisis, we were told . The treasurer, as happened in two authorities we visited - but examples could be found from every left authority in the year 1987-88 - announced that there was no scope for 'creative accounting' that year because all the options had been used the previous year . There were no hidden balances left, the costs of other schemes were likely to be prohibitive, and if not too expensive they were likely to be illegal . But then as crunch time got closer, small amounts of additional money became available from central government, 'savings' were found from a careful survey of existing spending proposals, and various financial schemes became possible after all . It really looked as if whatever the treasurer said was possible was possible, and was possible only because it was said to be . It became easy to believe that treasurers were 'creating reality' and did 'not have

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to be constrained by the everyday way of thinking' (Hines, 1988, p . 254), but it also became easy to forget the cautionary reminder that, even if there was not such thing as truth, 'there was such a thing as stretching it too far' (Hines, 1988, p . 256). In retrospect, it is clear that many of the budgets put together for 1987-88 were the products of wishful thinking . The last rabbits were dragged out of increasingly grubby hats, some of them beginning to look more and more like spending cuts masquerading as accountancy schemes . The desperate hope, particularly in London, was that Labour would win the election and ride to the rescue, offering new funds from the centre . Not only did this confirm that hopes of building a wider campaign had gone, but it also failed to get any response from a Labour leadership eager to prove its fiscal responsibility . The return of the Thatcher government almost immediately showed the dishonesty of many of the budgets put together in the previous year . For some time attempts had already been made in most authorities to identify savings within departmental budgets, particularly if these could be identified without being seen as 'cuts' . It was usually the job of the treasurer in collaboration with leading politicians to negotiate these 'savings' with the different departments, often through a council subcommittee or officer group . The criteria involved in this process generally bore little relation to any political priorities, although on big issues these might become apparent . On the more detailed chipping away at overall budgets, both politicians and treasurers seem to be happier not to question most savings extensively . In constructing the initial 1987-88 (rate-capped and legal, but not yet 'cuts') budget in Lambeth, for example, (and Lambeth was by no means unique in this) a crucial element in making the equation balance was to change the existing assumptions about vacancy rates . Instead of assuming that posts would be filled, the budget was put together on the assumption that many would not . This is an exercise in shuffling figures which is encouraged by the budgetary process itself, and helped to reduce political arguments about the needs and demands of inner city residents to a sterile debate about whether or not past records on filling vacancies could be bettered . Staffing became a financial or administrative issue rather than a service issue . Within the officer structure itself it helped to encourage the hidden 'savings' beloved of most chief officers in service departments as the time taken to fill posts stretched out, even once posts had been released and advertised . The simple assumption that accurately identifying 'real' vacancy rates means 'savings' that hurt nobody, is politically misleading for another reason, too . It implies that money allocated to staffing in the initial budget was not used for other purposes in the main budgets of spending departments . Yet, one of the reasons why many departments

Inside the machine

have historically maintained unrealistic establishment levels is that it provides a high degree of flexibility in spending . And this has been widely understood - if not explicitly stated - within the financial bargaining process . It is usually relatively easy to transfer - to vire funds from one head to another once the overall budget has been agreed . The treasurer's main finance control function has, in the past at least, been more concerned with sticking to agreed budgets than with spending within them . So in many authorities, intraorganisational bargaining has assumed some financial leeway, which builds up buffers to protect particular services - allowing for unexpected increases in demand or expenditure (see, e .g . Tomkins and Colville, 1984, pp . 98-100 for a discussion of the ways in which one police authority used its vacancy rate and the contrast with the same county's social services department within which no such manipulation was possible). This sort of leeway is rapidly disappearing or has already disappeared in most local authorities . Of course few socialists would endorse a professionally controlled process of budget construction which effectively hides real decisions, allowing them instead to depend on past fudges, 'slush funds', slippage and unspoken deals between senior officers . It may be regrettable that bureaucratic, or professional, politics works like that, and perhaps better systems of management, control and budgetary construction could and should be organised to make it clearer to workers, politicians and communities exactly how and why resources are being distributed in the ways they are . But a move in this direction is only possible if the existing rules begin to be challenged, on the basis that they reflect other political priorities : that cannot be done as long as the same old figures are used and accepted by leading councillors to make their own decisions look more acceptable . At present it is often convenient and politically expedient for council leaderships effectively to collude with existing systems rather than to challenge them . They, too, have a vested interest in losing cuts in the technicalities of budget construction . By producing painless savings or finding new sources of finance treasurers make themselves indispensable until they overstep the mark or can no longer deliver the goods . But by then it may be too late . Cuts in vacancy rates, for example, really are cuts, not just because manifesto commitments cannot be met if the staffing levels implied by them are not met, but also because in the past 'staff budgets have often been used to maintain spending under 'non-staff budget heads . A change in the political rhetoric of the local socialists came sharply after the Conservative victory in 1987 . 'Creative accountancy', which had in the past been the saviour of the left now became the explanation for the problems, alongside new rounds of rate-capping and other financial limits . Previous deals had to be paid for and central government carried on relentlessly plugging the financial

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loopholes . With remarkable speed cuts packages were put together in all of the left's London citadels and these were cuts not in the 198889 budgets, but in the already agreed 1987-88 budgets . Unless these cuts were endorsed it was argued that no budget could be put together for the following year which did not involve mass redundancies and even more draconian cuts in services . According to Margaret Hodge, 'Labour councils will soon face what people term "difficult choices", and services must come before jobs' (quoted in Wolmar, 1987, p . 11), but, in practice, it looks as if both services and jobs are already being hit hard .

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Whose politics?

The local authority left has been trapped in a debate whose terms have been set by others and has little chance of finding a way out . Financial rules are not 'innocent' abstractions but carry with them important political messages . Hopwood has suggested some reasons for the increased emphasis on accounting methods in the public sector, stressing in particular the way in which they can be used to diffuse the values of those in powerful positions, and then to monitor and regulate those accounted for (Hopwood, 1984) . In that sense they can be used to set the rules of the game - bargaining may still take place between different groups and different departments, but the rules of the game are already determined by one of the participants . Indeed the very process of bargaining sucks weaker groups into an implicit acceptance of the legitimacy of the powerful to manage decisionmaking . The methods of accounting help to determine what is 'significant' and to relegate the rest, so that once the significant has been identified, technical expertise can dominate the discussion about how to deal with it (Hopwood, 1984) . Lehman and Tinker suggest that 'the presence of a system of signification (like accounting) denies presence to challengers and rivals' (Lehman and tionker 1987, p . 516) which makes it difficult to see how the local authority left can use it unless also fundamentally challenging it . It is clear that accounting in the public as well as the private sectors 'is not a mere technical phenomenon' but can actively shape values (Hopwood, 1987) . This has been well understood by the Thatcher government and is reflected in the decision to set up the Audit Commission in 1982 to police the commitment of the Local Government Act 1982 para 15, 1 to ensure, 'that the body whose accounts are being audited has made proper arrangements for securing economy, efficiency and effectiveness in the use of its resources' . The Commission stresses the value for money ideology and professional practice within local government through what have been called the three 'Es' - economy, efficiency and effectiveness . It is not simply a mouthpiece for Thatcherism but has its own professional basis, which has led it to criticise some of the government's practices and to praise the operation of some local

Inside the machine

authorities . Its membership includes local authority treasurers, the secretary of CIPFA, and retired representatives of Labour local government and local authority trade unions (something which worries Walker, 1983, p . 65, from the right), as well as Conservative councillors, representatives of private accountancy firms and big business . One of its purposes has been to open up the potentially lucrative world of public sector auditing and value for money consultancy to the private sector accounting firms, which have expanded rapidly in this area since the early 1980s (see Kline and Mallaber, 1986, p . 14, pp. 38-44) . But the Commission's key role has been to confirm the dominance of accounting criteria in decision-making, and in particular to stress the need for 'economy' (i .e . reduced spending) and the identification of 'objective' measures of control . Attempts to measure relative efficiency have usually been rather crude, identifying major differences in costs between allegedly similar services without taking adequate account of genuine differences in demand and need, or in differences of political perspective which might lead to different policies on service quality . Left controlled councils are usually picked out for criticism and every piece of praise for a left authority is double-edged - on the one hand the argument is that service delivery is efficient - on the other hand it is accepted that the only fair comparator is the private sector . In other words, local authority services get redefined so that they are no longer community based and fought for, but are more or less efficient according to some notional comparison with the private sector . In this sense McSweeney is clearly right to point to the aim of moving power away from elected members towards chief officers, particularly treasurers and chief executives (McSweeney, 1988, p . 42) . This is, of course, one of the main reasons for the privatisation of public services - also encouraged by the Audit Commission, for whom best professional practice always includes considering the possibility (and implies the superiority) of privatisation . But it need not involve the privatisation of every service in every authority, just as long as there is a private - 'competitive' sector against which public provision can be judged . The dominance of capitalist measures of success is reinforced within the local state, through an agency which has relatively easily become part of the national local government system' identified by Dunleavy (1980, pp . 105-109) . So far the first two 'E's have been the practical limit of the Commission's intervention, and it has been criticised from the left precisely because it cannot actually measure 'effectiveness' which, it is said, has to be a matter for political decision, since it includes some notion of purpose, of aim . In general the Commission has sought to evade this criticism in its reports by comparing services between what it alleges are similar authorities, with the same problems and the

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same political complexion, as it did, for example, in its consideration of management in Inner London Boroughs (Audit Commission, 1987) . But this simply generates endless arguments that like is not being compared with like and that statistics are being manipulated to meet the prejudices of the Commission (see, e .g . Association of London Authorities, 1987) . There are now signs that the Commission intends to take the issue of'effectiveness' more seriously in the future, having won the ideological battle on the other two 'E's . The Controller of the Audit Commission appointed to replace John Banham (who left to join the Confederation of British Industry in 1987) has argued that, 'Debates on how to define effectiveness, which have so far been narrowly interpreted but which could be expanded to include the concept of service quality, have tended to generate far more heat than light . Focusing such light as there is will be one of the Commission's key tasks in its second term' (Davis, 1987, p . 35) . In other words, it seems likely that new claims are to be made for accounting which will increasingly identify standards of 'effectiveness' to be defined, not 'politically', but in terms of the 'best practice' of the private sector, and, of course, this will be reinforced by the drive towards 'competitive tendering' for a growing range of services. More accurately, political decisions will be hidden behind apparently technical criteria and local political decisions to identify alternative standards will be questioned with the full force of financial orthodoxy . orthodoxy . So, what are the implications of identifying a strong finance profession whose influence flows through local government, on the 'political' as well as the 'officer' side? One we have already indicated is the extent to which it effectively depoliticises political decisions . The financial crisis of local government as filtered through the finance profession actually makes it more difficult to take the issue back to the electorate - to the working class and other groups which support Labour . It also makes it difficult to form alliances with most sections of the workforce, since finance becomes the main management tool . The focus of the local government left's criticism shifts rather easily from real seats of professional power which it does not feel strong enough to challenge, or else sees as some sort of an ally in the shortterm at least, to local authority trade unions resisting change . Any initiatives which seek to use local government to change the face of British politics need to ensure that they do not end up being trapped within hierarchical networks which leave the powerless as powerless as before .



Inside the machine 1. Liverpool is sometimes also associated with this group, because of the role it played in resisting centrally imposed cuts . But despite some similarities in behaviour in the mid 1980s, it should not be included here without substantial qualification because the strategies adopted there were rather different, largely because of the particular role played by Militant . 2. The comments we make about the operation of finance officers and the budgetary process arise from a research project (funded by the EsRc) in which we have conducted in-depth interviews over a period of two years with relevant officers and politicians in six English local authorities, as well as attending a number of officer and councillor meetings and consulting a range of internal and public council documents . Research Grant No . E00232131, The political and organisational effects of fiscal stress on budgetary processes in English local government .

Notes

Association of London Authorities (1986) Restoring Local Government Finance . Association of London Authorities (1987) London's Financial Problems - Response to the Audit Commission . Audit Commission (1984) The Impact on Local Authorities' Economy, Efficiency and Effectiveness of the Block Grant Distribution System . Audit Commission for Local Authorities in England and Wales, HMSO . Audit Commission (1987) The Management of London's Authorities : Preventing the Breakdown of Services . Occasional Paper Number 2 . Audit Commission for Local Authorities in England and Wales, HMSO . Benington, J . (1976) Local Government Becomes Big Business . Community Development Project . Block, F . (1980) Beyond relative autonomy: state managers as historical subjects, in Miliband, R . & Savile, J . (eds) Socialist Register 1980 . Merlin . Blunkett, D . & Jackson, K . (1987) Democracy in Crisis . The Town Halls Respond. The Hogarth Press. Boddy, M . & Fudge, C . (eds) (1984a) Local Socialism? Macmillan . Boddy, M . & Fudge, C . (1984b) Labour councils and new left alternatives, in Boddy & Fudge (eds) (1984a) . Clapham, D. (1983) Corporate planning and the cuts . Local Government Policy Making . Cockburn, C . (1977) The Local State: Management of Cities and People . Pluto Press. Community Development Project (1977) Gilding the Ghetto . The State and the Poverty Experiments . Crompton, R . & Sanderson, K . (1986) Credentials and careers . Sociology. Davis, H . (1987) Holding the accountability line . Public Money, 6, 2 . Douglas, I . & Lord, S . (1986) Local Government Finance . A Practical Guide . Local Government Information Unit . Duncan, S. & Goodwin, M . (1982) The local state : functionalism, autonomy and class r elations. in Cockburn & Saunders . Political Geography Quarterly, 1, 1 . Duncan, S . & Goodwin, M . (1988) The Local State and Uneven Development . The Local Government Crisis in Britain . Polity Press . Dunleavy, P . (1980) Urban Political Analysis . Macmillan .

References

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Dunleavy, P . (1985) Bureaucrats, budgets and the growth of the state . British Journal of Political Science . Vol . 15 . Flynn, N . (1987) Delegating financial responsibility and policy-making within social services departments . Public Money, 6, 4 . Friend, A . & Metcalf, A . (1981) Slump City . The Politics of Mass Unemployment. Pluto Press . Gibson, J . & Travers, T . (1986) Block Grant: a Study in Central-Local Relations . Policy Journals for the Public Finance Foundation . Green, G . (1987) The new municipal socialism, in Loney, M ., Bocock, R ., Clarke, J ., Cochrane, A ., Graham, P ., & Wilson, M . (eds) The State or the Market . Politics and Welfare in Contemporary Britain . Sage . Greenwood, R ., Walsh, K ., Hinings, C .R . & Ranson, S . (1980) Patterns of Management in Local Government . Martin Robertson . Gyford, J . (1985) The Politics of Local Socialism. Allen & Unwin . Harbord, R . (1984) Financial Control in Local Authorities . The Part Played by the Chief Financial Officer . M .Phil Thesis . North East London Polytechnic . Hepworth, N . (1980) Local authority expenditure . Three Banks Review, 127 . Hepworth, N . (1984) Finance in Local Government. 7th Edition . Allen and Unwin . Hines, R . (1988) Financial accounting : in communicating reality we construct reality . Accounting, Organisations and Society, 13, 3 . Hoggett, P . (1987a) Waste disposal. Making municipal socialism work . New Socialist 47 . Hoggett, P . (1987b) A farewell to mass production? Decentralisation as an emergent private and public sector paradigm, in Hoggett, P . & Hambleton, R . (eds) Decentralisation and Democracy . Localising Public Services . Occasional Paper No . 28 . School for Advanced Urban Studies, University of Bristol . Hopwood, A . (1984) Accounting and the pursuit of efficiency, in Hopwood & Tomkins (eds) . Hopwood, A . (1987) Accounting and gender: an introduction. Accounting, Organisations and Society, 12, 1 . Hopwood, A . & Tomkins, C . (1984) Issues in Public Sector Accounting . Phillip Allan . Jones, G. & Stewart, J . (1984) The Case for Local Government . Allen & Unwin . Lehman, C . & Tinker, T. (1987) The 'real' cultural significance of accounts . Accounting, Organisations and Society, 12, 5 . Lipsky, M . (1979) The assault on human services : street level bureaucrats, accountability and the fiscal crisis, in Greer, S ., Hedlund, R .D . & Gibson, J .L . (eds) Accountability in Urban Society, Public Agencies under Fire . Urban Affairs Annual Review, Volume 15 . Sage . London-Edinburgh Weekend Return Group (1979) In and Against the State . Discussion Notes for Socialists . Mackintosh, M . & Wainwright, H . (1987) A Taste of Power . The Politics of Local Economics . Verso . McSweeney, B . (1988) Accounting for the Audit Commission. Political Quarterly . 59, 1 . Pendlebury, M . (1985) Management Accounting in Local Government . A Research Study . The Institute of Cost and Management Accountancy .

Inside the machine Rosenberg, D ., Tomkins, C . & Day, P . (1982) A work role perspective on accountants in a service department . Accounting, Organisations and Society, 7, 2 . Rosenberg, D . (1989, forthcoming) Power, Professionals and Politics: British Local Government and Financial Stress . Manchester University Press . Rowbotham, S ., Segal, L . & Wainwright, H . (1979) Beyond the Fragments . Feminism and the Making of Socialism . Merlin . Saunders, P . (1982) Why study central-local relations? Local Government Studies . 8 . Saunders, P . (1984) Rethinking local politics, in Boddy & Fudge (eds) 1984a. SAUS (1983) The Future of Local Democracy . School for Advanced Urban Studies, University of Bristol . Sbragia, A . (1984) Capital markets and central-local poli cs in Britain . British Journal of Political Science, 16 . Tomkins, C . (1982) Accounting Information in Local Governments . Final Report to Industry and Employment Committee of the ssac . Tomkins, C . & Colville, I . (1984) The role of accounting in local government . Some illustrations from practice, in Hopwood & Tomkins (eds) . Wainwright, H . (1987) Labour : a Tale of Two Parties . The Hogarth Press . Walker, D . (1983) Municipal Empire . The Town Halls and Their Beneficiaries . Maurice Temple Smith. Weinstein, J . (1986) Angry arguments across the picket lines : left Labour councils and white collar trade unionism . Critical Social Policy, 6, 2 . Wilmott, H . (1986) Organising the profession : a theoretical and historical examination of the development of major accountancy bodies in the utc. Accounting, Organisations and Society, 11, 6 . Wolmar, C . (1987) The fresh face of the capital's politics . New Statesman, 114, 2947 .

61

This paper argues that where, as in Iran, the perceived needs to subjugate women has been firmly articulated with the prevalent belief system, it becomes more difficult to find practical strategies for liberation through employment of women and their participation in the processes of production. Where women are defined as 'dependent', encouraged to marry early into polygamous marriages, and where they are systematically excluded from the work place and the formal labour market, then female poverty can ultimately become integrated and institutionalised . In a country which is not prepared to finance a national welfare system or protect the poor, women are forcibly squeezed towards the outer margins of the economy and obliged to eke out a living on the borders of legitimacy. Unavoidably many now populate the 62 prisons and some even find that their families are better off living off the pensions paid to their dependents .

Hale Afshar Women in the work and poverty trap in Iran • The stated ideology of domesticity that is part and parcel of the Islamic government's employment and social policies has direct and severely adverse effects on women ; those who are too poor to afford the luxury of full-time domesticity . The current constitution nominates men as heads of household and responsible for the welfare of the family . Thus by definition women have become second class citizens who must be morally protected by and financially dependent on men who are the designated providers and protectors . Those women who are not supported by a male breadwinner have become the lowest strata of the second class citizens . They have been defined as the 'unprotected' BISARPARASTAN by the constitution and are supposed to be dependent on the State . But despite its legal obligation to provide for this group, the government has yet to make any provisions to do so . As a result the poorest and low income women are of necessity obliged to fend for themselves and secure a livelihood for their family as best they can . But they do so in the context of a general condemnation of all women working outside the domestic sphere . The 'unprotected' carry the double burdens of poverty and ideological antagonism . The espoused ideology of the State has always played a central role in defining the legitimate areas of employment for women in Iran . I The formal labour market was gradually opened to women and expanded as part of Reza Shah's modernisation policies . Thus whereas only 13,000 women were in paid employment in 1941 when Reza

Women in Iran

Shah came to power, the total had increased to 573,000 in 1956 . 2 Not surprisingly women were confined to traditionally feminine sectors of the industry, such as textiles, carpet weaving and garments . For the poor, the labour market remained firmly segregated throughout the reign of the Pahlavis . In the factories, women, 80% of whom were illiterate and had no formal training, were confined to monotonous, repetitive tasks which were universally labelled as 'unskilled' . In the service sector they remained in the lowest grades of cleaning, catering and care . By far the largest percentage of impoverished women, however, were employed in the highly segmented informal sector, the entry to which was and still is tightly controlled by kin, village and neighbourhood ties .3 Housed in shanty towns and without access to most city facilities, poor migrant women maintain their village grouping and familial networks . Frequently families move to join their relatives, who help to find them a site and build their makeshift houses . Houses that become their permanent domiciles . Marriages are arranged amongst relatives and access to a street patch or a domestic job is negotiated . Until the 1960s few women moved independently to towns and those who did generally went directly into service and lived in the houses of their employers . But in the mid 1960s for the first time the proportion of women migrants rose above 50% of the total . In part this was caused by the advent of the land reforms . Although only 29% of the peasantry obtained land as a result of the reforms4 a much larger proportion of the rural population lost their access to employment . This was caused by the more intensive use of familial labour by the newly created landowning peasantry each with their small parcel of land and by the provisions of the reform laws which exempted those landlords who mechanised their farms from distribution of their holdings . The relativ prosperity of the urban areas, the growing building and light indus vies and the expanding service sector all helped to absorb the new

ave of migrants . By the early 1970s the proportion

of rural to urba population had changed from 60/40 to 40/60 and a larger pool of about was available for both the formal and the informal sectors to draw on . At the same time the prevailing ideology of modernisation enabled the newly emerging food and chemical and pharmaceutical Industries to employ larger numbers of women on the production lines .

The informal sector became a major source of employment for The informal sector women . Thus whereas in 1956 17 .8176 of the female urban workforce was working in the informal sector, the proportion had increased to

23 .4 ,76 of the total in 1966 and 59 .1 % in 1971 . Of these over 40 96, were divorced and 7176 were heads of household . 5 The range of

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activities for this group extended from the better paid domestic service jobs such as washing clothes, cooking, cleaning etc . to hawking goods in the streets to begging and prostitution . The sprawling urban slums and shanty towns, some of which were built on plots in the middle of the capital, and the increasing numbers of beggars and peddlars were deemed as undesirable by the Shah, who saw them as detrimental to his modernist image . As a result in the late 1960s and early 70s the Shah's government embarked on sporadic measures to round up beggars and street walkers, and use bulldozers to clear out the slums . Thus destitute women were harassed on the streets, their freedom of movement was severely constrained and many were made homeless from one day to the next . Such policies fuelled the discontent of the men and women slum dwellers who joined the revolutionary demonstrations in droves and gave their wholehearted support to the Islamic uprising . 6 But after the revolution, the lot of the poorest women did not improve and the sporadic rounding up of beggars and prostitutes continues . In fact the righteous and moralistic posturing of the government and its espousal of the most reactionary interpretations of Islamic dictum along with its firm endorsement of patriarchal relationships has led to a considerable erosion of the already limited opportunities open to women working in the informal sector . The prevalent polemics of gender segregation and male supremacy have combined to squeeze women out of most areas of the labour market . But the paternalistic discourse has not been translated into government funded support systems for the impoverished and unemployed women . The limited measures that had been taken initially have been abandoned in the rush to pay for the seven years old war against Iraq . The regime has been unwilling to accept that for many women 'immoral' occupations such as prostitution is a necessity and not a carefully planned western inspired wicked plot to lead the upright muslim men astray . Where the revolution has made a difference is in opening a wider arena of discourse and criticism and delineating new issues as open to public debate . Whereas the Pahlavi regime did not allow any unfavourable analysis of its policies to be published legitimately, the current theocracy leaves room for some degree of discord . One of the questions that is open for evaluation is the status of women . Although by and large the media endorse the views of the religious establishment and the women's weeklies run lengthy serials by leading clergy telling women how to be good wives and mothers, there has nevertheless been a number of critical articles written about the lives of the poorest women in society . After one of the bouts of street clearance, Zaneh Rouz, the most popular women's weekly in Iran, interviewed a number of beggars and prostitutes . One was quoted as saying :

Women in Iran 'I became a prostitute at fourteen, there was no other way of feeding the family . . . I thought at least if I give them my life they may be spared my fate . So I went on and this is how we survived' . 7 In the early months of the revolution prostitutes were encouraged to repent and give up street walking . Those who came for help were advised to find an alternative source of income and paid a small stipend by the government . But the payments were cut short by the war and many women have been obliged to return to the streets . As one women told Zaneh Rouz : 'after the revolution the Fight Against Evils sections, Dayereh Mobarezeh ba Monkerat, paid me 25,000 rials per month and I worked in a sewing factory and supported my mother and my son . But the money stopped and they closed the factory and I had no options left . So I went back to the streets . . . there is no other job for me' 8 Prostitution often leads to or results from addiction and drug pushing becomes a related sideline activity : 'My husband divorced me and I was desperate, I smoked the odd pipe (of opium) to calm down and before I knew it I was hooked . Then I lost my job as a hospital cleaner . . . after that the only alternative for me was to become a prostitute to support myself and the children's The current theocracy, however, condemns addiction as an antirevolutionary and untreatable habit . In 1982 all drug rehabilitation centres were converted into hospitals for war casualties and the government decided to send all addicts who persevere with their habits to prisons : 'We managed to revolutionise a whole country and get rid of a whole system of corruption, all by ourselves and without any professional help, surely these people can just give up addiction by themselves . . . In any case there is no medical treatment for addicts and addiction centres have never cured anyone, so we've given up this useless practice and have classified addiction as a crime . . . Giving up drugs never killed anyone and the only suitable treatment for those who persist in this undesirable habit is to put them in prison .' io The high moral tone and the total absence of any material help from the State speeds up the downward spiral of misery of the lives of these women who are all too aware of the futility of their imprisonment :

cast;

37-E

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'I think that the courts instead of subjecting me to lashes so that I admit to being an addict and then putting me in prison, should think of a solution for my problem ." 1 'We should be given treatment not punishment . . . Where can we go once we are out? I have nowhere to go but the streets . I have no wish to be discharged since I know that I'd be back in no time .' 12 Many prostitutes spend their childhood as beggars and return to it in their old age . In a recent round up in Tehran 40% of the beggar women that were arrested said that they had been prostitutes in earlier years . 13 In Tehran as in other large third world capitals there are tightly knit and well organised groups who make a living by begging ; entrance to the profession is mediated by kinship ties, descent and marriage . Patches are owned and inherited and many a woman has raised her children on the same corner of a pavement . Some have working husbands whose incomes are insufficient and others are the sole provider for their large families . Sometimes it is a male relative who sends the women out to beg, at other times it is the older woman who sends out the younger ones to beg : 'We are from Khorasan, they took my husband to fight the war and so my mother in law put me and the baby out to beg for a living .' 14 As with prostitution so with begging, the government has been generous with its condemnations and parsimonious in material help . Once more women are seen as more guilty than men . The man responsible for helping the needy, Ayatolah Moussavi Bojnourdi, the undersecretary for Protection of the Improved Living organisation, Moaveneh Hemayatieh Sazemaneh Behzisti, states : 'Begging by women is worse than begging by men in the eyes of Islam . In the case of a man, since he is responsible for supporting himself, we may have a glimmer of understanding . But women have no such duty . Since women must be supported by others, then it is this man who has to pay for her as well . If she is unprotected then she must work . Women who beg betray our social norms and betray the very dignity of womanhood and its respected status in society .' 15 It says much about the intoxicating power of a belief system that the firm opinion that women are protected by men should in itself make all women who are not so protected in real life appear guilty of grave misconduct in the eyes of the Ideologues . Working, however, is none too easy for those women who do not have familial mediators into the service sector, as one beggar said:

Women in Iran

'I moved to Tehran when my husband died and left me with three kids to raise . But I had no contacts, no experience and no references, so I couldn't find any other job, so I ended up begging in the streets .' It is possible for some women, who are sufficiently elderly and have enough capital, to create a job for themselves or to inherit one . But such cases are rare and such women still have to solve the problems of domestic work and child care . They must also brave public disapproval . Women petty traders and hawkers are on the whole a northern phenomenon in Iran . In the south a combination of ideological constraints which exclude women from the market place and plough cultivation system that marginalises their productive role in the rural sector, help to confine them to the domestic sphere . In the north, women are a major part of the agricultural force, active in rice transplantation and tea cultivation . As a result the social mores have evolved in a less restrictive way allowing them access both to the fields and to the market place, an access which is crucial in providing them with some degree of economic independence . 17 Women vendors often operate at the interface between rural production and urban consumption, buying or producing the food themselves and then selling their surplus either from door to door, or on the street corner, or at the weekly, often all women, markets in nearby towns . Usually the profits are small and the work arduous . Those women who have a smallholding grow their own food are only able to market their produce with the help of their children and at the expense of their education . As a woman herbseller with six children in Massal in Guilan explains : 'If I send the children to school, then I couldn't get the housework done, nor produce enough to pay for our livelihood' 18 The income earned is often barely adequate for the family's subsistence ; for example a Mazandari woman selling vegetables door to door estimated in 1985 that she earned about 350 rials a day to feed herself and her 9 children . At the time the average rural cost of living was about 30,000 rials, 19 so that if this woman worked every day of her life she'd still not earn half as much . Other women traders like their counterparts in South India 20 depend on the intermediary of men shopkeepers to buy the vegetables at the wholesale market and have to meet the exacting criteria of perceived modesty . One such woman herbseller had solved this problem by working a patch opposite to that of her husband . The husband has lost the use of his limbs cannot weigh the bunches of herbs, he is reduced to selling toys and biscuits from a tray and earning very little, but his presence lends respectability to his

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working wife . In the absence of free child care provisions women vendors are obliged to combine child care with their business . A 47 year old onion seller in Tehran, who took over the sales trolley from her husband when he became too ill with arthritis to be able to work, carries her youngest children on the cart . 21 Even though her disabled husband is at home, she does not consider him 'able' to take on child care . Nor can she afford to send her children to school . 22 Since men are perceived as domestically incompetent female familial ties come to play a central part in the survival strategies of slum dwelling women . They take on the orphans of their dead siblings, and those who can, live with their mother or a sister to share the domestic work and the payment of the exorbitant rents . A well known pavement tea seller in Tehran lives with her widowed sister . The tea lady earns about 900 rials a day and her sister receives a 12,000 rials pension for her dead policeman husband . Between them they barely manage to pay the 9,000 rial rent and buy enough food to survive in a city where the cost of living is conservatively estimated to be about 40,000 rials per month . 2 3 A marginally better paid means of survival is to find domestic employment in private households . Employers require reliable references and only those women who are sufficiently well connected can obtain such jobs . Some inherit the job from their mothers or aunts . Others move directly from their village to the landlord's house or that of his friends and relations . Many domestic servants are caught in the moral economy of kin and cannot conform to the currently idealised social mould to get themselves married off : 'when I was young I couldn't marry because there was no one else to support my younger sister . When my sister died, after a long illness, I had spent all I had to cure her . So I did not have a dowry, and no one would marry me .'24 At the same time domestic work no longer provides a secure lifelong occupation . With the advent of modernisation and increasing nuclearisation of the families, the old traditions of keeping on elderly retainers have gradually disappeared . Servants are easily and frequently dismissed and domestic work is now paid for on a daily basis, the average ranging between 250 and 400 rials for a 9 to 12 hour day . There are no provisions for accidents, sickness or old age : 'I worked as a washer woman, as did my 13 year old daughter . But our house caught fire and I burned my hand trying to rescue our belongings . My hands never healed and I haven't been able to work since' 2 5 'If I ever get too sick to work then I'll die of starvation' 26 'I lost my husband when I was nearly 40, then I had no choice

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69

but to become a servant to keep myself and the children alive . I've been working for about 30 years now . The children have grown up but they are too poor to help, so I'll have to work till I die . ' 27

It is abundantly clear that impoverished women work outside their home out of dire necessity . But the ideological association of female employment and immorality means that few women venture out to work with any degree of safety . Those who do are perceived by men to be readily available sexual preys . As a result women who wish to resolve the contrary pressures of needs and modesty are obliged to work within the confines of their home . Even then the boundaries of honour and respectability keep them constantly in fear . One such seamstress who supports herself and her three children explained : 'I must take care at every moment . Men, when they see a widow woman, they view her as an easy and helpless prey' 28 Thus the combination of economic need and ideological condemnation of female employment places the impoverished women in Iran in an impossible situation . Male unemployment, conscription, poverty, ease of divorce and polygamous marriages has intensified the problems of desertion and abandonment of women and has led to an ever increasing number of those that the government has labelled 'the unprotected' bisarparastan . Divorce, desertion or widowhood generally spell destitution for those women who live on the margins of subsistence . The deserted are left penniless, widows are entitled to little and usually get less than their due . Women inherit only half as much as men . Childless wives inherit 1/4 of their husband's wealth and mothers inherit only 1/8 . For the poor such portions are not even a pittance . Divorced women fare even worse . Unless otherwise registered, all joint property belongs to the male head of household. At divorce the only required payment by men is the stipulated mahre, married women's entitlement for consummation of marriage, a sum that is negotiated before marriage and recorded in the marriage contract . After divorce women are not entitled to maintenance and those who try and find employment face the general disapproval of the society in which they live . A young woman explained her plight eloquently when she said : 'Have you ever heard of a man losing his home and his position and being unhappy after the divorce or loss of his wife? He won't starve, he won't be a sexual prey, he won't be the recipient of accusations and unkind treatment from friend and foe alike . He won't be ostracised by family and neighbours . He won't be unprotected and unloved and he won't need to beg to

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survive . . . he won't end up in the streets homeless and unable to rent a room from anyone . People won't deny him a roof and won't see him as a threatening divorcee' 29

The unprotector

Where destitute women are concerned, the State in Iran is caught in a dilemma posed by the contradiction of its ideological perceptions and the realities of their lives . In theory females of all classes are protected by the male heads of household who in pursuit of their religious and national duty would set out to marry all unattached women and provide them with a home and protect their dependants . The government has emphasised the legal obligation of men to pay maintenance, nafageb to their dependants, 30 legally defined as only those who are of direct vertical line of descent of the man concerned . 31 In theory those entitled to maintenance can take the man responsible to court and obtain their due .3 2 Payments are supposed to be made according to the ability of the payor and the needs of the dependants .33 In practice men do not pay and the 'unprotected' cannot afford to extract their legal dues . As for the State, all it has done for the 'unprotected' women and children is to encourage polygamy, as the only way of creating a male protector for them . The war has exacerbated the problem . Men are conscripted to fight, but they are not paid a living wage . Those who are killed in action do not leave a pension behind . Despite the nationally orchestrated eulogies of the martyrs and war heroes the government does not even make a contribution towards their funeral expenses . Their widows end up in the street in ever larger numbers . Even the government funded programmes of clearing up beggars cannot cope with the situation ; many are released since there are no funds available to house and feed them . Some are put in prison and their children left to fend for themselves as best they can . As one such child says : 'What do you expect? Do you suppose that they come from the prison and say 'dear children have some pocket money?'3 4 In the heyday of the revolution, when the new Constitution was drawn up, the government was made responsible for the welfare of the 'unprotected' . It was to 'create an insurance system to protect widows and old and unprotected women' . 3 S Accordingly on the 13th November 1983 the Cabinet instructed Majlis, Parliament, to draw up the necessary legislation to meet this responsibility within a three months period .36 It took Sazemaneh Behzisti, the Better Living Organisation, four years to draw up the Bill . Once there, it was promptly rejected by Majlis . The Bill had failed to overcome religious prejudices and financial shortages . As a member of Majlis' Law Committee pointed out :

Women in Iran

'We have not managed to formulate a suitable law for such women in keeping with the framework of Islam and respecting their honour and dignity'3 7 another MP added : 'Of course the problem is funds and where they should come from .' 38 Meanwhile unconnected and haphazard policies formulated by privately funded charities, government sponsored groups and State organisations provide largely inadequate assistance for the 'unprotected' group of their choice . A choice that may include the poorest and/or the middle class women of strained circumstances . Officially Behzisti ; the Protection and Guidance Headquarters, Setaeh Sarparasti va Ershad; the Needies foundation, Bonyadeh Mostaazafin ; the Iman's assistance group, Komiteh Emdadeh Emam and the 15th Khordad Foundation and charitable individuals are all providing their own brands of help . Private organisations are also licensed by Better Living to run their own old and disabled people's homes provided they allocate 5 % of their beds to the organisation . In addition Behzisti extracts some extra help from private and charitable nursing homes who obtain their licences on the basis of a similar agreement . Although women are likely to be destitute, charitable homes have more places for men than women . Usually men can gain access to such institutions within a month of application, whereas women invariably have to wait for more than eight months . There are proportionately fewer men seeking accommodation . The patriarchal structure of society enables men to retain their economic control over what little resources there are . Economic control is in turn reflected by the social norms which make families feel more responsible for the care of the male rather than female elders . Those families who take charge of looking after disabled members of their household are rewarded by Behzisti who pays them a monthly allowance of 60,000 rials . This organisation also pays small pensions to 'unprotected' families ; these are female headed households who have lost the husband, father or eldest son/brother through death or imprisonment or desertion or disability . But divorced women are specifically excluded from such benefits : 'If a woman who wants to leave her husband feels unprotected, she will continue living with him . If she realises that there is an organisation to protect her then marriages will easily fall asunder'39 By 1984, there were 76,517 families protected by Behzisti receiving from 3,000 rials for a single person to a maximum of 7,500 for families of three and more . This in a city where the lowest rent for

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a room is around 6,000 rials . In 1985 there were 27,500 families on Behzisti's waiting list who were expected to remain there until some of those receiving pensions become independent and move on . 4 o Behzisti does not help those charitable institutions which are funded and run by private individuals and volunteers for fear of discouraging such donations . It does, however, run some orphanages . These accommodate 3,000 children, but they refuse to help the children of divorced parents 'because such help would contribute to an eventual rise in divorce figures' . 41 The orphanages have a policy of placing as many children as possible with foster parents, in order to make room for the increasing numbers of deserted children . But they operate in the context of a culture which does not have a tradition of adoption and care for those born outside the kin group and which poses religious obstacles to admitting an unmarried girl into the family . Muslims consider all men other than those related by marriage or direct descent to be namabram, outsiders, to women, that is to say not allowed to set eyes on them . Those who foster or adopt children do so for personal gain and tend to treat the children in their care as slaves . According to Dr Yarigar Ravesh, Head of Behzisti, their records show a high rate of mortality for adopted children . 42 Where girls are concerned on the whole, orphanages attempt to marry them off and the girls themselves see marriage as the only viable alternative open to them : 'The only solution for us is marriage, or finding a job . . . but there are no jobs'4 3 Marriages are arranged by the Protection and Guidance Headquarters, Setadeh Sarparasti va Ershad : 'Men who wish to get married apply to the director of Setad who then puts them in touch with us and we introduce them to a suitable girl . We even provide her with a dowry .'44

Institutional organisation of the marriage market, where girls are raised to expect marriage and men allowed easy access to brides through state funded charitable institutions, must be viewed with considerable suspicion in a country where divorce, polygamy and desertion are rife . Even the Iranian theocracy is aware that some women are 'unmarriageable', in theory there are some provisions to help such cases : "Unprotected" women who . . . for some reason are unable to marry, must be employed by government sectors and private production units to enable them to become active participants in society and to lighten the heavy burden of government's responsibility . By being gainfully employed in suitable jobs

Women in Iran such women will cease to walk aimlessly round the streets, an activity which in itself makes them vulnerable to various forms of corruption' 45 To meet these aims Behzisti has set up a few training and residential centres for 'unprotected' women . Each centre usually accommodates about 10 boarders and 50 day women who are trained in skills such as sewing and paid piece rate for what they produce and given free food ration tickets . The places fall far short of demand and some turn away as many as 20 women a day for lack of facilities . Those who get a place can, in a good month, earn as much as 50,000 rials . But the centres depend entirely on government contracts and as the war expenses increase, allocations for such marginal concerns decrease . At the same time these institutions have a vested interest in keeping the women's pay as low as possible . They do so by labelling them as 'unskilled' and 'trainees' whose work : 'is not up to standard . . . so that they cannot go out and compete in the open market . They can only make flags and sheets for revolutionary guards and their hospitals .'46 Although the centres see themselves as a stage in training and preparation of women for the labour market, women who work there do not expect to find any other work . Most are supporting their families on the meagre income and handouts obtained at these centres . One group of women interviewed at one such centre in July 1987 were between 15 and over 70 years of age and each had an average of 4 to 6 dependants . Access to these centres is mediated by Guidance Headquarters though many had got there by knowing someone in the Centre's management . To qualify for a place a woman must be seen as : 'Likely to be harmed by society and in need of help . Those who if we do not help, God forbid might be led astray .' 47 A more intentionally decentralised charitable institution are the neighbourhood Komiteheyeh Emdadeh Imam . These are local units funded by charitable donations from the worthy in each district and some contribution by the government . These komitehs claim to assist 73,000 'unprotected' women in cities and 13,000 in the villages . 48 The komitehs pride themselves on being independent of Behzisti and other State agencies and see their simple unbureaucratised cells as the most effective and efficient means of identifying the needy and providing the necessary help . They determine who the 'unprotected' are as they see fit and decide on appropriate levels of payment . Reported payments range from 9,000 rials per month to a reformed prostitute to 10,000 for a widow, who in addition has her son educated at the expense of a wealthy local merchant who is one of the komiteh's 'advisers' . 49

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Capital & Class Women who are protected by the Society for the Protection of the Families of Prisoners, Anjomaneh Hemayateh as Khanevdeh Zendanian on the whole fare better . The organisation is funded by the government and obtains additional resources by selling the products of prison workshops . It has a more realistic concept of the cost of living and pays 5,000 to 10,000 to those families who have a subsidiary income and 10,000 to 25,000 to those who don't. It provides for some 10,000 families with about 5 children each and also gives some additional assistance with food, fuel and medical bills . On

74

average 'unprotected' wives of prisoners who have one or more children get a monthly payment of 11,000 to 17,000 rials . Unfortunately most prisoners and their dependants are unaware of the exisence of the society . Those who do find out about it must submit to the cumbersome bureaucratic processes which require a testimony by the prisoner, another by his or her relatives a third from a social worker and an endorsement by the prison authorities . Each of these stages requires a knowledge of the existing official and unofficial networks and a skilful handling of the appropriate red tape . Most destitute women lack the knowhow for getting access to the benefits . Those who manage to get money from the society obviously do better than those who are paid by Behzisti . Although the procedure for the latter is less complicated, women still have to find someone of good repute to testify to their destitution . One woman obtained a stipend because her son was a revolutionary Guard and as such a prominent member of society . Even so the monthly payment of 7,500 did not even meet her 9,000 rials room rent . So she also worked as a cleaner, a job which she obtained with the help of a reference from her son . In addition to make ends meet she was obliged to sew about 100 pairs of gloves a month at 3 rials a pair .

The formal labour market

Although the Iranian revolutionary State was at war for all but one year of its existence it has not been able to solve the problems of male unemployment . This despite the massive death toll at the fronts . The government began by a stated policy of underdevelopment which was accelerated by the flight of capital which ensued and the fall in internal consumption that has followed . 50 Although during the war years there was something of a small boom in the war industries, other sectors were and still are stagnant and employment opportunities remain limited . In an attempt to balance the national budget, the government has 'rationalised' the civil service, largely by retiring female employees and not taking on new staff . 51 The private sector has achieved a similar result by excluding women from most processes of production . This has been in part as a response to the clergys' advice that the workforce should be segregated . For the management that has meant removing the women

Women in Iran rather than men and taking on only men as new employers . In a recent survey of the central region's light industries, Zaneh Rouz reporters found that not one of the factories visited had employed a single new female employee since the revolution . All owners, directors and managers felt that it was 'unislamic' to employ women when there were unemployed male heads of household available who had the responsibility of providing for entire families . 52 As the Prime Minister's adviser on Labour Affairs, Mr Mahjoub explained : 'War and revolution have led to a relative stagnation in industrial development . . . naturally those seeking work exceed the number of jobs available . In this situation our first priority is to provide employment for those who are responsible for supporting families . As a result men become the obvious choice as they are the breadwinners . . . From the very beginning our religious leaders stated that women should only do light work in accordance with their delicate physical characteristics . . . I can promise that when the economic situation improves and when we have created employment opportunities of such nature as not to undermine the domestic lives and duties of women, then we will undertake to employ women in jobs that are suitable for them .'S 3 The question of 'appropriate' work is one that has been difficult to define, Mr Mahjoub suggests typing 'which is a delicate job' as being 'suitable' . But at the same time he has grave reservations about making secretarial posts the exclusive domain of women : 'because it encourages women to behave like dolls and not real workers'5 4 The Deputy Speaker of Majlis Mohamad Yazdi is of the view that : 'Our working sisters can only be employed in the pharmaceutical industries . . . All the other women must now turn to Behzisti for help ." Not a very promising perspective when Behzisti is busily training the 'unprotected' to join the very labour market which has just been declared as out of bounds by Yazdi . To meet the ideological requirement of the theocracy, Nationalised Industries Organisation issued a directive in 1985 forbidding the employment of women in any of its industries . When questioned by reporters the Administrative Secretary simply said : 'Men have priority in access to jobs . This is in accordance with our religious beliefs and practices . . . and is accepted by all . Naturally our sisters are unlikely to succeed in the exacting

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context of our industrial units or on the factory floors which impose difficult and demanding tasks, targets and schedules .'56 The only growing sector of the economy, the defence industries also exclude women as a matter of policy . The Head of Political and Ideological Section of these industries Hojatoleslam Motbahri explained his position : 'In principle I am against all employment for women outside their homes . . . in my opinion basically the access of women to the factory floor is against the laws of nature . . . Besides if women are employed by industry and the public sector, they will displace men and close their employment opportunities . . . We encourage all those ladies who wish to retire from work to do so and we will replace them with a young active workforce of the male gender .' 57 Attempts to exclude women from paid employment dates back to the early years of the revolution . As early as 1982 the all male workers councils were trying to sack women workers : 'We don't need so many women workers . We have already announced that those who wished to return to the warm embrace of the hearth and the family to raise better children for our revolution may do so with our blessing . We even offered to replace each woman by a male member of their household . But so far no one has accepted our offer . . . perhaps as our Islamic culture evolves and its values take root, these ladies will appreciate the importance of motherhood and accept it as their exclusive perogative and duty' 58 Motherhood, is perceived as strictly confined to the home . Neither the polemic nor the concern extends to the need for the care of those children whose mothers are obliged to work . Since the prerevolutionary Labour Laws are still on the statute books, there are legal provisions for child care and maternity leave for working mothers, but of course usually they are not implemented . Legally women are entitled to 90 days unpaid maternity leave, all factories employing 10 or more mothers with children under school age must provide a nursery, and nursing mothers must have 30 minutes in every three hours to suckle their babies . But there has never been any penalties for failure to meet these requirements, and on the whole they have been ignored . The Islamic Republic has in practice blocked these altogether . To accommodate its ideological opposition to working mothers, a government directive has long since made it illegal for the public sector organisations to allocate any government funds to set up or maintain nurseries . Although not implemented, the spectre of the law is constantly

Women in Iran raised as a major reason for not employing women . The Chairman of the Majlis Committee on Employment and Social Affairs recently declared : 'Imagine employing a worker who nurses her baby every three hours, has a lunch break after four hours of work and takes an extra thirty minutes to say her prayers ; a worker who spends an hour to bring her child from school to the nursery ; not take off fifteen minutes at each end of the day and you've got no working time left at all . You can't stop work every five minutes for a different reason . We are not planning a social gathering on the factory floor and we don't pay people for not working . The point is that those who wish to work must do so full time and reap the benefit . . . 'Having three months off for maternity leave means that the employers must either leave the machine idle or employ someone whom they have to sack three months later . . . then when she is back they have to give the lady 30 minutes off every three hours to feed the baby . . . Well obviously it is much simpler to employ a young man instead and not have any of these problems . . . ' 5 9 This modernist vision of the privileged woman worker with extensive legal entitlement to child care facilities is now combined with the Islamic concern with gender segregation to make women appear as an unprofitable and immoral workforce . From its inception the Iranian theocracy has been demanding that those women who must work should do so separately from men . Although the kind and degree of separation has never been defined many factories have sought to implement the regulation with differing degrees of alacrity . The level of religiosity of the management, proximity to the capital city and the proportion of women in the workforce are all factors which contribute to the level and speed at which special separation is enforced . In some cases men are now being employed in the traditionally feminised industries such as textiles . Factories situated in or near Tehran, where there is a large pool of migrant labour available and where proximity to the seat of power makes them politically very visible, have been diligent in segregating their workforce . Occasionally in the early days this resulted in the promotion of a woman to head an all female section, but of late employers are more interested in removing women from the production line . A typical example is Rey's textile complex where women have been systematically moved out of the factory floor and put into a separate area to weave carpets instead or to sew garments . Not surprisingly the carpet workshop is making a loss . It cannot compete with the experienced rural home workers who produce high quality carpets at considerably lower prices and form the backbone of

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the industry . So now the management has decided to close the unit and make the women redundant . 6o The situation is marginally better for female textile workers in the northern provinces, where women's productive work has traditionally had a much higher visibility in the rice and tobacco fields and where female factory work dates back to the 1930s . Although the long history of outdoor work enables women to earn their living, in the North as elsewhere they remained classified as unskilled' 61 and capable of only working in the specifically feminised segment of the labour market . In Mazandaran, for example textile and garments are still seen as the preserve of women as the director of the Mazandaran Textiles explains : 'Much of our work can only be done by ladies . Weaving needs attention, patience and a delicate touch . Men are totally unsuited for such work and are only used in the areas that require strength or as drivers . . . Women are much more productive than men in mending and metrage and sewing . No man could do the delicate mending work which needs a lot of patience .' 62 The director of Cottons and Weaving factory is of the same opinion : 'In some sectors we don't use men at all because women's work is much finer . If you take thread winding men produce about 500 kg for every 650 kg produced by women'6 3 The director of Khazar complex agrees : 'It is pointless to employ men to sew . Sewing is of its nature women's work and men would be wasting their physical strength in such an occupation .' 64 Although women textile workers in the north were the first to have been employed in the formal sector in Iran, they still have not succeeded in getting adequate childcare provisions on the premises . Some factories such as Mazandaran Textiles provide a creche for children under two, others don't even have such minimal facilities . Nor have women been exempt from working night shifts . The Islamic government has said much about the undesirability of women working at night . But in August 1987, when the new exmployment bill was submitted to Majlis, sectors such as health and services which still depend on women's work, were permitted to continue employing them round the clock . Women who work must do so as men and on the understanding that they would be better and more productive than men . As one worker explains : 'I sew up 500 to 600 pieces of material each day and they expect us to produce at the same level whether we are well or ill or

Women in Iran whatever, what matters to them is that production levels must stay high'6 5 But the payment they receive is gender specific . As elsewhere, they are seen as naturally dextrous and patient and are therefore paid less than men, who are obliged to spend considerable time and effort to acquire such 'skills' . Since the assumption is that it is not possible to 'improve' on nature, women workers have little chance of promotion and few job grades to move up on . 66 As elsewhere they are also paid on the basis that their income is supplementary to that of an employed male head of household . So women get paid 1/2 or 1/3 of men's wages, for example in 1985 women textile workers in Mazandaran could earn 35,000 rials after four years and 40,000 after 16 years in the job . Similarly in 1982 women working in ghee factories in Tehran or tobacco factories in Orumieh were earning about 30,000 to 36,000 rials per working month . 68 Tobacco work, however, is seasonal and the factory employs them for only 7 months each year : 'We work only seven months each year, but we have to eat . . . even in the months that we have no work and no pay . . . It is not easy to survive on these wages' 69 Yet most of these women are either the head of their household or a major contributor to its income . Some support aged parents and young children and relatives . These women caught as they are in the web of familial obligations find it difficult to seek refuge in the idealised embrace of a protective husband : 'I am worried, if I get married then who will support my mother and sisters and brothers?' 70 In real life working men with low incomes are unwilling and unable to accept the Islamic burden of familial responsibility that the government has allotted to them . As a woman worker who is polygamously married explains : 'My first husband died of cancer and left me with two children and my aged parents to look after . . . I married my present husband who has a wife and three children . . . well this was my destiny . . . He is very much against my working . . . he's bought us a house . . . I live there with my parents and children . But he says "I didn't buy the house for your parents, leave them and your children and just live with me", as if I would ever do such a thing' . 71 Even though in the post revolutionary euphoria of concern for the poor and the 'free' media such cases are reported, the State and management's attitude has not changed . As a result there are women

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who are trying to feed six people on an income of 31,500 rials . At the same time a combination of revolutionary ardour and economic stagnation has resulted in a governmental decision not to allow any rise in wages, despite the raging inflation and severe consumer shortages . Many working class women are caught between the cutting edges of an oppressive ideology and an exploitative economy . 'Please Miss reporter for God's sake write that we are at the end of our wits with these prices . The rations are far too short and we have been forced to go to the black market and you must know that with these low wages we simply can't get enough to eat' . 72 These women, like all the poor, spend almost all their income to obtain inadequate food and shelter . There is a critical shortage of housing in the urban areas and many are haunted by the spectre of homelessness . Some factories provide home loans, but usually these are allocated to men ; even in factories where women are the main workforce and men are used as casual labour . The director of the Orunieh tobacco factory's explanation shows that management does not even feel it necessary to justify such decisions . 'last year we were able to give loans only to the brothers because there were fewer of them and they had agreed to come back and work here next year as well' 73 Excluded from such loans in the same factory was a widow with 4 children under 8 who had worked there for years and had to find 5,000 rials for rent every month . The high cost of urban housing has resulted in some women living in villages which are considerable distances away from their workplace, some have to travel 30 km each way, though none possesses a car . Some factories run a bus service for their workers, but many don't . Living far from the centre of prosperity most of these women have no running water or electricity . Even those who obtain a loan to build a house do not fare much better . Loans are small and land prices high . An old woman explains the outcome : 'I have worked all my life . . . at last they gave me a loan and I bought 120 meters of land in Baqer Abad, Behesheth Zahra (a village about 10 km from Tehran) . I built four walls around it . It has neither door nor frame nor water nor electricity and the road leading to it is not tarmacked . It has nothing . When I have to go up the road I wade up to my knees in mud' 74 Living far away from work in poor and expensive houses, working long hours and having to cope with shortages exacerbates the problems of carrying the double burden of productive and domestic work for women . All remain responsible for cooking, cleaning and childcare. Even those who have an unemployed husband at home do

Women in Iran not see him as either willing or capable of doing any housework . Those who get home too late to cook have to feed themselves and their family on bread and cheese . 75 All carry the responsibility of healthcare and welfare of their families : 'By the time I get home it is 5 or 6 pm, then I have to prepare a meal, clean the house, look after the children . I don't know which one to fit in such a short space of time . By the time I've got going it's time to go to sleep . . . I spend all my days off on sorting out family problems, taking the children to the doctor, getting them vaccinated, seen to etc . . . . When will this tired working body of mine find a moment to rest?' 7 C Workers are entitled to one day leave for every full month of work . But the poor medical facilities available to workers and the distances they have to travel mean that most women have to take additional unpaid leave just to get access to a doctor . Although insurance contributions are automatically deducted from all wages, workers health care services have virtually disappeared . Most have to pay privately to get medical help . During the war the Ministry of Health had to find thousands of extra beds for wounded heroes . As a result the workers' hospitals and health centres had either been taken over for the military or opened to the general public . At the same time the Ministry and the Military built and opened new hospitals for the exclusive use of the new armed elite, the revolutionary guards . As a result women often had and still have to choose between spending entire days in queues in the hope of seeing a doctor in a public hospital or paying for private consultation . The erosion in workers' health care facilities is mirrored in the virtual disappearance of their social security entitlement . In the aftermath of the oil boom, the Pahlavis finally set up a Social Security organisation in 1976 and made it responsible for the payment of 75 of the wages of those workers who were on sick leave . Those unable to return to work were entitled to a pension proportionate to the period they had spent in employment . Women retiring at 55 with 35 years' service were entitled to a pension equivalent to their average income in their last two years at work . But although the law remains on the statute books it has not been implemented and most workers are unaware of its existence . Most employers have not been paying their social security contributions which should range from 7 % to 27 % of the workers' wages, depending on the size of the factory . Women who continue to go out to work under such adverse conditions do so out of dire necessity and in the current climate of opinion all are made to feel guilty about not fulfilling their paramount duty of motherhood . None has managed to solve the problem of childcare . One textile worker with 13 years of experience was, in accordance with the segregation requirement, promoted to C&C 37-F

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head the production line, and paid 50,000 a month . But she had to give up her job when her child went to school . The factory had no child care facilities for school age children ; school ended at mid-day and the factory stopped at 4 pm ." Many have to leave their children alone as one woman put it 'in the care of God' or with unwilling landladies : 'A landlady puts up with 4 or 5 children running around the place for a few months and then sends us all packing . Then I have to find another room and another landlady . . . its a nightmare . ' 78 This nightmare is the essence of the life experiences of women workers in Iran . One such describes her life and her feelings : 'My son had epilepsy since he was born . I don't know what caused it, it must have been lack of food or something like that . . . I think maybe it was because I didn't look after him properly because I had to go to work . . . anyway he was sick, I spent a lot of money and took him to many doctors . . . finally he had enough and killed himself at nineteen . . . Now it's just me and my 2 sons . . . the eldest is fourteen and is in the first grade of secondary school . He failed last year and had to resit two exams, he'll probably fail again . When there is no one to keep an eye on them they're bound to do badly . . . the other day his teacher wanted to see me, but I can't afford to lose a day's wages to go and see him . . . 'I leave the house at 5 .30 am' . . . when I leave the children are asleep, I leave them in the care of God and leave 20 or 30 rials for their lunch . . . sometimes I put the kettle on for them, but they don't have the gumption to make tea so they just turn it off and go out without any breakfast . . . 'My poor children they have never experienced maternal love and so they are not caring or thoughtful . . . by the time I get home I am so tired and so worried that I lose my temper with them and just cause trouble and strife .' 7 9

Conclusion

Working class women in Iran have to pay at the personal level the heavy costs of the State's policies and ideology of domesticity . The belief in the inferiority of status of women is orchestrated at every level and enshrined in the post-revolutionary labour relations . Women who go out to work are denounced by the men and the media as irresponsible or unlslamic . A view that cuts across notions of class solidarity and is echoed by male workers as well as employers and law makers . All efforts are concentrated towards pushing women into marriage and motherhood . This at a time when marriage has become a highly unstable institution . The ease with which men can divorce

Women in Iran their wives, the growing prevalence of polygamy and the high levels of male unemployment, which persist despite the carnage at the fronts, have all made wifehood a precarious occupation . Since the State cannot admit to the tenuous nature of current marriages, particularly amongst the poorer classes, it continues to blame women for breakdown in marital relations . With its habitual disregard for evidence, the theocracy seeks to punish divorced women . They are not allowed to benefit from the limited help that is available to those who have been abandoned or widowed . No one stops to ask who divorced these women . That in a country where recent legislations have made divorce the automatic prerogative of men . Only educated middle class women who know their laws can negotiate the right to divorce and include it in their marriage certificate . 80 A privilege that is not open to illiterate working class women, many of whom are married off in their early teens, sometimes polygamously . Yet though it is men who can legally discard their wives, it is the women who have to carry the brunt of public disapproval . They must cope with their sense of failure, with the stigma of 'immorality' and with all the men who see them as easy sexual preys . There is no sisterly solidarity for such women, who are seen by others as a potential threat . The emphasis on marriage and its insecure nature has set women against one another, each defending their own domestic corner from the potential threat posed by their unattached sisters . Men, far from being the appointed 'protectors', are the whimsical husbands who can legally keep many permanent and temporary wives or move from wife to wife, leaving a debris of destitute women behind them . Once divorced the combination of social condemnation and public disapproval, and the degrading pursuit by men slides these women towards the streets and drug pushing and prostitution . The war with Iraq and the deterioration of industries have had adverse effects on women's employment and has accelerated their downward spirals of poverty . Those who remain married simply have more and more children while their incomes remain static . Many are compelled to seek paid employment . Those women who go out to work in the factories, or on the streets, do so out of dire necessity . For most of them there is no 'protection' in the shape of a male breadwinner who is able to meet the household expenses, nor is there anything remotely adequate in terms of state benefits . The nine years of war which has only recently ended and the fall in oil prices on the international market has deteriorated the economic situation in Iran, along with State funded social and health facilities . What little there is is allotted to the wounded soldiers . Women who have been neither warriors nor employed by the war industries become even more marginalised . Under the present

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circumstances it is difficult to come to any but the most pessimistic of conclusions about the plight of impoverished women in Iran . Notes

1. For a more extensive discussion of this issue see Afshar H . 'Muslim women and the burden of Ideology' Women Studies International Forum vol . 7 no. 4 1985, pp . 247-250 and Najmabadi A . 'Women State and Ideology in Contemporary Iran' paper presented at the Workshop on 'Women, Islam and the State' Richmond College, London 1987 . 2. Andishehahyegh Rastakhiz, and Iran Almanac . I am grateful to Ruth Pearson for pointing this out to me . 3. 4. See Afshar H . in Iran a Revolution in Turmoil. The figures are based on information obtained from Iran Almanac, 5. Donya, the political and theoretical publication of the central committee of the Tudeh party and R . Rouba 'Relationship between urbanisation and the changing status of women in Iran 1956-1966' in Iranian Studies vol . V Winter, 1972 no . 1 . For further details see Afshar H . Khomeini and Tabari A. the 6. enigma of in Tabari A . and Yeganeh N . In the Shadow of Islam Zed press . Zaneh Rouz 9 November, 1985 . 7. 8. Ibid . Ibid . 9. Dr Seyed Hosein Fakhr Director of the Collaboration Headquarter 10 . Setadeh Hamanhangi Battle against Addiction unit, Zaneh Rouz 16 November, 1985 . 11 . Zaneh Rouz 16 November, 1985 . 12 . Zaneh Rouz 27 June, 1987 . 13 . Ibid . 14 . Zaneh Rouz 4 July, 1987 . 15 . Zaneh Rouz 27 June, 1987 . For a more detailed discussion of this please see Afshar H . in Women, 17 . Work and Ideology Tavistock . Zaneh Rouz 28 October, 1985 . 18 . 19 . Estimates by the Centre for Rural Economic Studies Makrazeh Tahqiqateh Roustayi, quoted by Zaneh Rouz 4 January, 1986 . See Joanna Lessing . 20 . 21 . Zaneh Rouz 28 October, 1985 . 22 . Zaneh Rouz 13 April, 1985 . 23 . Tahqiqateh Roustayi, quoted by Zaneh Rouz 4 January, 1986 . 24 . Jahaneh Zanan vol . 2 no. 9 May, 1981 . Zaneh Rouz 18 May, 1985 . 25 . 26 . Jahaneh Zanan op . cit . 27 . Zaneh Rouz 4 May, 1985 . 28 . Ibid . Ibid . 29 . 30 . Article 1198 of the Civil Code . 31 . Ibid . article 1196 . 32 . Ibid . article 1205 . Ibid . article 1198 . 33 . 34 . Zaneh Rouz 30 November, 1985 .



Women in Iran 35 . Article 21 Section 4 . 36 . Kayhan 15 November, 1983 . 37 . Ayatolah Seyed Mohamad Khameneyti, member of the Legal and Criminal committee of Majlis Zaneh Rouz, 26 October, 1985 . 38 . Mrs Rajazi Zaneh Rouz 26 October, 1985 . Qeisary administrator of Majlis Committees quoted by Zaneh Rouz 39 . 28 October, 1985 . 40 . Zaneh Rouz 11 May, 1985 . 41 . Zaneh Rouz 27 April, 1985 . 42 . Zaneh Rouz 8 June, 1985 . Ibid . 43 . 44 . Zaneh Rouz 18 July, 1987 . 45 . Hojatoleslam Syed Hamid Rouhani Controller of the Bureau of Records of Islamic Revolution Daftareh Atnadeh Engelabeh Eslami, Zaneh Rouz 5 September, 1987 . 46. Zaneh Rouz 18 July, 1987 . 47 . Head of Guidance Ali Khani quoted by Zaneh Rouz 18 July, 1987 . 48 . Zaneh Rouz 11 May, 1985 . 49 . Ibid . 50 . See Afshar H . Theo . . . 51 . See Afshar H . State . 52 . Zaneh Rouz 19 October, 1985 . Ibid . 53 . 54 . Ibid . 55 . Zaneh Rouz 28 October, 1985 . 56 . Zaneh Rouz 22 August, 1987 . 57 . Ibid . 58 . Etelaateh Banovan 8 May, 1981 . Zaneh Rouz 5 October, 1985 . 59 . 60 . Zaneh Rouz 19 October, 1985 . 61 . See Elson and Pearson . 62 . Zaneh Rouz 11 January, 1986 . 63 . Ibid . 64 . Zaneh Rouz 19 October, 1985 . 65 . Zaneh Rouz 11 January, 1986. 66 . See John Humphrey . 67 . Etelaateh Banovan 8 May, 1981 . 68 . Ibid . and Jahaneh Zanan 21 April 1981, vol . 9 no . 2 . 69 . Banovan op . cit . 70 . Zaneh Rouz 1 May, 1982 . 71 . Banovan op . cit . 72 . Ibid . 73 . Ibid . 74 . Ibid . 75 . Zaneh Rouz 18 July, 1987 . 76 . Zaneh Rouz 26 October, 1985 . 77 . Zaneh Rouz 28 October, 1985 . 78 . Zaneh Rouz 19 October, 1985 . 79 . Banovan op . cit .

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Richard Gunn Marxism and philosophy : a critique of critical realism • What follows is an attempt to reopen an old question, that of the nature and conceptual status of the categories of Marxist thought . The two 'classic texts' of Marxism which raise this question are Georg Lukacs's History and Class Consciousness and Karl Korsch's Marxism and Philosophy, both published in 1923 . In the Stalinist 1930s and 40s, with some notable exceptions such as the writings of the Frankfurt School, the question disappeared from view . It came into prominence again in the debates over methodology in the 1960s and 70s but since then has once more entered eclipse as part of the general 'decline of the left' . Hence my aim is to renew, at least by implication, certain of the 1970s debates . This seems a matter of political urgency since a left unclear about the fundamental concepts of its own thinking is a left all-too-ready to concede the points it should be defending and to define its agenda by whatever markers it finds planted on the enemy's terrain . Examples of this latter tendency are the infatuation with new technology in the latest redraft of the Communist Party's programme and the theme of active citizenship (cf. Plant 1988) in the Labour Party's policy review . To a large extent, the left's response to the right's ascendancy has been to prioritise directly practical-political issues over methodologicalconceptual ones, but this is surely short-sighted not least because (as argued below) first-order 'empirical' points and second-order 'methodological' points must form a unity in the development of Marxist thought .

examining the conceptual status of marxist theorising, the author challenges the attempt by Bhaskar to make critical realism a philosophy for the left. This article argues that internal linkages between practice, theory and metatheory, evident in Marx's writings, provide a richer understanding of society than do the structured, causal relationships offered by philosophy . 87 By

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Class The form my article takes is that of an argument around some formulations advanced by Roy Bhaskar in a paper for the 1988 Socialist Conference at Chesterfield, published in Interlink 8 (Bhaskar et al. 1988). Bhaskar advocates a philosophy he terms 'Critical Realism' . The programme of Critical Realism, as outlined in his Interlink article, is one of elucidating the 'enduring structures and generative mechanisms underlying and producing observable phenomena and events' ; in Marxist terms, his model is a particular understanding of the relation between 'appearances' (which may be misleading, mystifying and so forth) and social 'essence' or 'reality' which Marx propounds in Capital (cf. Geras 1972) . Critical Realism is critical because, rightly, it refuses to take appearances at their face value ; it is realist because it believes that the 'structures' and 'mechanisms' which it regards as generating appearances exist not merely as theoretical constructs but objectively, and in practice, as well . The founding text of Critical Realism is Bhaskar's A Realist Theory of Science, published in 1975 . There, the problematic is not so much one of Marxist or political issues but of disputes within the philosophy of science . One of my contentions will be that these philosophy-of-science roots entwine all too closely with the programme of Critical Realism in its present, political, guise . This said, I shall be less concerned to debate Critical Realist doctrines in detail than to sketch in contrast to Critical Realism an alternative understanding of the conceptual status of Marxist thought . I have selected Critical Realist formulations as my point of departure because - unlike those of the aftermath of 'structuralist' Marxism (for a critique see Bonefeld, 1987b) and Rational Choice Marxism, two other currently influential methodological schools they throw the question of Marxism and philosophy into relief. The question of Marxism's relation to philosophy is inescapable for an exploration of Marxism's conceptual status if only because 'philosophy' is the discipline, par excellence, which has reserved to itself the right of debating issues of a categorial and conceptual kind . Bhaskar opens his Interlink contribution by saying that 'the left needs to take philosophy seriously', and for the reason just given he is right to do so . It is on this broader question of Marxism and philosophy rather than on Critical Realism as such that my presentation will concentrate, although I shall offer comment on some specifically Critical Realist doctrines in due course . The basis of my disagreement with Bhaskar can be stated very simply . When Bhaskar says that 'the left needs to take philosophy seriously' he seems to mean that the left for its own part needs a philosophy, his own philosophy of Critical Realism being offered as filling this alleged conceptual gap . My contention, as against Bhaskar, will be that the (Marxist) left has no need for a philosophy : there is no conceptual gap within Marxism which 'philosophy' might



Marxism and philosophy

fill . In saying this, however, I am far from implying that Marxism amounts to a positivism or scientism uninterested in categorial questions ; rather, I am concerned - as were many strands in the debates of the 1970s - to underscore the 'Hegelian' dimension within Marx . Marx saw Hegel as the paradigmatic 'philosopher' but, I would urge, he was never more Hegelian than when the critique of philosophy is present as a figure of his thought . The question of whether Marxism needs a philosophy at all is logically prior to the question of whether it needs a specifically Critical Realist philosophy . And it is the question of Marxism-andphilosophy (Korsch's 1923 title) which highlights the crucial issues so far as Marxism's conceptual status is concerned . This explains why, in the present paper, a discussion of the tenets of Critical Realism per se takes second place . Likewise it explains why a (brief) account of the nature of 'philosophy' is the place where the argument of my paper should begin .

Which questions are 'philosophical' ones? Oversimplifying, we can say: philosophy does not ask 'Is X true?' but, rather, 'What is truth?' . More precisely, it asks after the validity of the categories (the set of terms or conceptual framework) in virtue of which X counts as true : the kind of truth we arrive at depends on the conceptual framework we employ . In other words philosophical questions are ones of a metatheoretical' (a second- or higher-order) as distinct from a theoretical' (a first-order or empirical) kind . Philosophy, as a discipline or discourse, separates metatheory from theory and reserves to itself the former as its own, specifically philosophical, domain . Philosophy has good reason for projecting this separation . If first-order theory were to undertake the justification of its own categories then theory couched in some set of terms would have to validate these same terms ; pulling itself up by its own bootstraps it would presuppose what it was supposed to show ; and vicious circularity would be the result .' The specification of a realm of 'metatheory' as distinct from 'theory' breaks out of this viciously circular trap . And hence philosophy legitimates itself . This said, however, the theory/metatheory separation on which philosophy turns has fateful consequences . If it is second-order theory that is to validate the categories of first-order (empirical) theory then, presumably, we need a third-order theory to evaluate the categories of second-order theory . . . and so on, without hope of halt . Vicious circularity is avoided, but at the cost of infinite regress : from the devil to the deep sea . If this is so then the programme of philosophy is flawed at source, and the flaw is precisely the notion of a discrete and separable region of metatheory (labelled 'philosophy') which at first seemed to promise such logically cogent results .

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How might the dilemma 'vicious circularity or infinite regress?' be overcome? Perhaps it is tempting to think that it might be overcome by ignoring philosophical (or metatheoretical) questions, and indeed the Marx of The German Ideology (Marx 1975, vol . 5 p . 236) advises us to 'leave philosophy aside' and to concentrate on the actual or real world . But matters are not so simple, since any theorisation, however empirical, employs categories . Unless it undertakes to be answerable for them, relativism - the view that any conceptual perspective is as good as any other 2 - is the automatic result . The questions of category-validation which philosophy construes as its own are thus unavoidable, and to this extent Bhaskar is right . I suggest that the above-mentioned dilemma can be overcome only by developing a notion of theorising which is theoretical and metatheoretical (or first-order and second-order) at the same time . Such theorising must be theoretical qua metatheoretical and vice versa . Theorising of this kind would overcome vicious circularity since it is already metatheory . And it would overcome infinite regress since it does not separate theory from metatheory : it does not, in the manner of philosophy, treat the latter as a discrete and autonomous conceptual domain . Not only does theorising of the kind here indicated place its own first-order truth-claims at issue by posing to itself the question 'Which categories are valid?' ; additionally, and conversely, it places the validity of its categories at issue before its first-order truth-claims themselves . Neither level of its theorisation is reducible to the other, but both are reciprocally informing : as it were, they are allowed to interact . Such a mode of theorising addresses 'philosophical' questions but, with good reason (infinite regress having to be avoided) it does not adduce a philosophy to do so . It contains no gap which philosophy might fill . And so, to the extent that this notion of theorising can be clarified and supported, Bhaskar is wrong . I further suggest that Marxist theorising is theorising of just this theoretical-metatheoretical kind . Marxist theorising answers to the just-mentioned requirements, despite the inadequacies of Marx's occasional comments (e .g . my above citation) on this score . It is this notion of theorising which gives substance to Marx's critique of philosophy in his polemics of the 1840s, and which informs the critique of political economy (a critique which, Engels and dialectical materialism notwithstanding in no way depends on philosophy) developed by Marx in the course of his later life . We need to pay attention to Marx's critique of philosophy . We need also to pay attention to the notion of a theory which is also metatheory on which this rejection turns . This notion of a theory-metatheory unity gives us a first insight into what I should like to call Marx's theoretical 'totalisation' . A

Marxism and philosophy totalisation is a dynamic unity-in-difference to which nothing can be added, and from which nothing can be subtracted, without destroying the totalisation as a whole . For the 'totality' is wholly present in each of its 'moments' or parts . To add philosophy to the totalisation of Marxist theorising may therefore be to undermine it ; and such I suggest is the case . Further : it is the configurations of this totalisation which, in outline, my article aims to bring to light . Philosophy : a very short history If philosophy disrupts Marxism, some contextualisation of Marx's notion of theorising is in order . It was not always the case that philosophy construed itself as pure metatheory . Roughly speaking, it only did so from Kant onwards . Ancient Greek philosophy understood itself as asking both first-order and higher-order questions ; it could do so because it saw itself as interrogating a world, or cosmos, which it viewed as already meaningful in itself . In the order of things, the categories needful to speak truthfully of this order were believed to be already inscribed . Plato's 'Theory of Forms' is the best-known instance of philosophising in this cosmological mode . The demythologisation of modern 'enlightenment' did away with the ancient notion of a cosmos (an in-itself meaningful world order) once and for all . Philosophy responded to this demythologisation by abandoning cosmology, which entailed a theory-metatheory unity, and by taking refuge in a solely metatheoretical redoubt . Thenceforth questions of the validity and status of categories were construed as sheerly metatheoretical questions, with all the dangers of infinite regress signalled above . To be sure the move to the notion of philosophy as metatheory was both hesitant and complex . Seventeenth-century 'metaphysics' still carried cosmological overtones . Only in the twentieth century, the tendency of which is to assimilate philosophy to 'methodology', does the equation between philosophy and metatheory become complete : Russell's theory of logical 'types' and the 'philosophy of science' which unfolds from it are the most signal instances of the transition concerned . It is Russell who enunciates the case for a theory/metatheory separation in the clearest terms (cf . Davie, 1986 ; Gunn, 1987c) . The consequences of this separation are (a) the positivism of a first-order theory which disallows reflection on categories and (b) the tedium of a philosophising which, as purely metatheoretical, treats engagement with worldly issues as an infection of a non-philosophical kind . Anyone who has studied either the social sciences or philosophy knows what this positivism and this tedium mean . It is Marx (and, I would suggest, Hegel before him) who attempts to renew the notion of a theory-metatheory unity without

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moving on to cosmological ground . This Hegelian-Marxist renewal has two steps . The first (especially clear in Hegel : cf. Hegel, 1874 para . 41 ; 1977 pp . 47-8) is to resist the notion of metatheory as a distinct conceptual realm which philosophy might appropriate as its own . The second step (especially clear in Marx although already prefigured in Hegel's Phenomenology of Spirit : cf. Hegel, 1977 pp . 490-1 ; Gunn, 1988a) is to link theorisation, not with a cosmos, but with practice . For Marx theory is an aspect, or moment or dimension, of practice . Conversely, for Marx, practice includes theory : for example capitalism as a mode of production includes the ideologies of 'freedom, equality, property and Bentham [or atomised self-interest]' (Marx, 1976 p . 284) as intrinsic to the reproduction of capitalist relations of production through time . And it is Marx who, in 1844 (cf. Marx, 1975, vol . 3 p . 332), says that uncritical positivism complements - instead of contradicting - uncritical idealism, i .e ., the idealism of philosophy . Philosophy as sheerly second-order metatheory trails the positivism of sheerly first-order theorising in its wake, and vice versa . Marx condemns the dichotomous severance of theory from metatheory inherent in Russell's programme more than half a century before this programme was announced . It follows that Marx also, by implication, condemns the notion of 'methodology' . (I shall return to this .) A Marxist philosophy and/or methodology - in fact any notion of a Marxist metatheory understood as separate from first-order theory - is a contradiction in terms . For example, to read Marx's Capital either as sheerly first-order and empirical (the reading attempted by bourgeois sociology) or as sheerly second-order and philosophical (the reading attempted in e .g . Althusser, 1970) is to miss its challenge . Capital is both first- and second-order. It is both because it is neither on its own ; it is neither because it is both.

Practical

reflexivity

I have proposed that it is by understanding theorisation as linked to as forming a unity with - practice that Marx can unify theory and metatheory, thereby dispensing with the need for a 'philosophy' : but how exactly is this so? The answer to this question lies in what I shall term 'practical reflexivity' . Theory is reflexive when it reflects on the question of the validity of, or justification for, its own categories . Theory is practically reflexive when in doing so it reflects upon and understands itself as inhering in a practical (a social) world . Marx - and after him Lukacs, Horkheimer, Adorno and Gramsci, to name only a few - elaborates theory in this practically reflexive way . (For references and a more extended discussion see Gunn, 1987a .) To see how practically reflexive theorising unifies theory and metatheory we should note (a) that practically reflexive theorising

Marxism and philosophy includes itself within its own object, viz . social practice, and (b) that it thinks about the validity of its own categories precisely while reflecting on its presence (its situatedness) within the society it attempts to understand . Its theorisation of its object, of its presence within its object and of the validity of its categories (as categories appropriate to the theorisation of precisely that object) are not three separate conceptual moves but a single totalisation . Each of the three dimensions of this totalisation already effects the other two . For practically reflexive theorising, thinking about its object already raises the question of its presence in that object ; and thinking about itself already raises the question of the object - the totality of social practice - in which it inheres . Further, its reflection on society is already reflection on its own truth-criteria and vice versa ; this has to be so if, in accordance with Marx's thesis of a theory-practice unity, theorisation is to understand itself as practically rooted without remainder or, in other words, as practical through and through . Not just the first-order but also the second-order (or metatheoretical) dimension of theorising inheres in practice ; this is what Marx tells us when (Marx, 1975, vol . 5 p . 5) he urges that it is 'in human practice and the [reflexive] comprehension of this practice' that theoretical (read : so-called philosophical) 'mysteries' stand to be resolved . Thus it is that practically reflexive theorising overcomes the theory/metatheory (the philosophy/non-philosophy) separation . It does so because it meets the condition of being first- and second-order at once : simultaneously and on one and the same conceptual movement, it advances on each of these two fronts . Put otherwise : the same body of theory plays now a 'theoretical' and now a 'metatheoretical' role . Each of these two dimensions of practically reflexive theory informs and interrogates the other . The first-order 'object' of practically reflexive theory has something to say about the categories which might validly cognize it, and the categories themselves have something to say about how the 'object' is to be constituted and defined . Neither dimension is reducible to the other and, within their totalisation, neither has exclusive rights .3 Vicious circularity would result if all the rights were given to first-order discourse about theory's object ; infinite regress would result if all the rights were given to second-order discourse about theory's categories ; but neither is here the outcome because, according to the idea of practical reflexivity, only a single discourse - or, better, a single totalisation or interaction as between theoretical levels - is entailed . If theory were merely reflexive and not practically reflexive these totalising conclusions would not follow . For it is only for practically reflexive theorising that the questions of the character of its subjectmatter and of the validity of its categories appear within the same level of theorising (this level being theoretical or metatheoretical as the case may be) . Reflexive but non-practically-reflexive theorising finds

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itself pinned on the horns of the dilemma : vicious circularity or infinite regress? So : not merely can practically reflexive theorising avoid the dilemma; additionally, only practically reflexive theorising can do so . And here, I suggest, an important conceptual strength of Marxist theorising lies . The importance of this point appears to me to be such as to deserve emphasis . All that I have said follows from the idea of theory's understanding itself as, without remainder, a moment in and of the practice (the society) whose character and contradictions it aims to make clear . For such theory, to drive deeply into first-order elucidation is to generate metatheoretical insights, and to drive deeply into metatheory is to carry forward first-order elucidation itself . To raise metatheoretical questions is at the same time to raise social questions, not least because every social crisis is an epistemological crisis as well . Two consequences follow . One is that the question 'Should Marxists devote themselves to methodological or empirical research?' becomes meaningless : to be a Marxist is to do both (because sheerly neither) at the same time . The second consequence is that, within practically reflexive theorising, there is no space which a 'philosophy' - a metatheory disconnected from theory - might appropriate as its own . In other words, as averred earlier : the gap within leftist theorising which Bhaskar offers to fill with the philosophy of Critical Realism does not exist .

Critique of Critical Realism (1)

Before pursuing the account of the status of Marxist categories on to which the notion of practical reflexivity opens, I shall ask : to what extent does the above represent a criticism of Bhaskar's views? Something resembling practical reflexivity makes its appearance in Bhaskar's Interlink article, since we there read that 'social theory and social reality are causally interdependent' in the sense that 'social theory is practically conditioned by, and potentially has practical consequences in, society' . Does this imply practical reflexivity in the full sense of my preceding section? The answer to this question has to be No . The 'causal' interrelatedness which Critical Realism envisages as between theory and practice is at best an external interrelatedness : it has to be, since a causal explanation is tautologous unless the term in the causal relation which explains and the term which is to be explained are reciprocally independent and distinct . This is so even if the terms concerned are held to be 'causally interdependent', i .e ., to explain one another . Some definitions are helpful here . An external relation (and all causal relations have to be external relations) is one which leaves unaffected the terms between which the relation obtains . An internal relation is one which affects and constitutes the related terms . Marx for his part sees theory and practice as being linked not just in an external - a

Marxism and philosophy causal - but in an internal way . Practice constitutes theory and vice versa. Only in virtue of this internal relatedness do they form a totalisation . Introducing causalism into this totalisation undermines it . Worked out to the end, it is only in the form of a determinist conception of political action that a causalist approach to Marxist discourse can unfold . Either causalism or internal-relatedness : there is no way to combine them . Space forbids, here, an exploration of determinism's consequences . But from Engels through Plekhanov and Lenin we can learn from history - if history teaches us anything where a political practice premised on determinist theory leads . Primarily, the claim just raised to the effect that theory and practice are internally related is a first-order one : it relates to the 'theory' or ideology and the 'practice' or social action which goes forward in social worlds . But, secondarily, it is also a second-order claim inasmuch as without remainder theory grows from practical roots . It is the second-order (or metatheoretical) implications of the point which are relevant just now . Once theory and practice are construed as externally (e .g . causally) related it becomes impossible to say, as was said earlier in the course of defining practical reflexivity, that theory which reflects on its own practical situatedness and which reflects on its categorial validity does both together and at the same time . The two dimensions fall apart . They do so because it is possible for theorisation to acknowledge that is has practical and social preconditions while also holding off from this social-situatedness the question of its categorial validation as a topic to be addressed in a purely and practice-independent metatheoretical realm . It was on the basis of this separation as between the causal explanation of a theory's occurrence and its categorial validation that bourgeois 'sociology of knowledge' was born . To keep the theoretical and metatheoretical dimensions of theorising together we need not an external but an internal relation of theory to practice . And since Marxism understands theory and practice as, thus, internally linked we can say : the totalisation it effects within theory is a totalisation as between theory and practice as well . It is a totalisation which opens on to practice and exposes itself to the challenges (ones of struggle and unpredictability) which practice presents (cf. Bonefeld, 1987a) . We can also say : Bhaskar advertises a philosophy, in the above sense of a pure and infinitely regressive metatheory, in the same conceptual movement as he understands the theory-practice relation in an external and (reciprocally) causal way . Philosophy closes itself off against practice - it forms an allegedly practice-independent 'realm of its own' (cf. Marx, 1975, vol . 5 p . 447) - and so stands at the opposite pole to practically reflexive theorising, which places itself at issue within the social practice it reports (Marx, 1975, vol . 5 p . 3 : Thesis II) . But is this criticism of Critical Realism fair? Is Critical Realism

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a 'philosophy' in a solely metatheoretical sense? Perhaps Bhaskar might endorse all of my anti-philosophical points and yet say that they do not apply to him . Perhaps he philosophises in what, given my above definitions, amounts to a non-philosophical way . Certainly, from his Interlink contribution, it is difficult to gather what Bhaskar understands the conceptual status of Critical Realism to be . The most we learn is that it 'provides a set of perspectives on society (and nature) and on how to understand them' . To make sense of this, we should once more take historical stock . In my 'very short history of philosophy' I reported methodology as being heir to the seventeenth-century metaphysics which first projected philosophy as a metatheory disconnected from all else . Metaphysics still carried in its wake cosmological traces . Russell's critique of metaphysics, which in the twentieth century transposed philosophy into the key of philosophy-of-science 'methodology', attempted to purge these traces once and for all . But the notion of methodology appears unable to effect the definitive purgation since, after all, for a methodology to be an empirically rich one it must in some fashion stand in a relation of correspondence or analogy - a mimetic relation, to use the terminology of Ancient Greek philosophy - with the world whose character it purports to make clear . A purely unworldly methodology could achieve nothing, except perhaps death, and we know that science has advertised for us all manner of worldly and practically successful goods . For this reason, the notion of philosophy as pure metatheory has involved an attack even on the notion of 'method', Karl Popper's onslaught against a 'logic of scientific discovery' being the first move in this post-methodological game . The second move is towards a 'post-empiricist' philosophy of science (cf. Kuhn, 1962) which condemns the residual elements of methodologism, and thereby of cosmology, in Popper himself . From the assuredness of metaphysics we move through the middle ground of methodology to the idea of a set of 'perspectives' (Bhaskar) or of 'paradigms' (Kuhn) . The point of this short rendition of philosophy's twentieth century history is to suggest that it is precisely by attenuating itself that the notion of philosophy as a metatheory severed from theory holds itself in play . The informality of the idea of 'a set of perspectives' fails to equate with philosophical innocence . On the contrary, such informality can amount to philosophy-as-metatheory bending over backwards in order to maintain its domain . In fact, as indicated earlier, it is in post-Russellian philosophy of science that Critical Realism's roots lie . And philosophy of science (whether or not one devoted to setting forth a scientific 'methodology') is, we can now say, philosophy's paradigmatic twentieth-century guise . Philosophy as philosophy-of-science reproduces the idea of philosophy as turning on a theory/metatheory divide . If all this is so then my criticism of Critical Realism is indeed a

Marxism and philosophy fair one . It is a fair criticism because neither a first-order theory cut off from its categorial self-reflection nor a second-order theory which abnegates its own (practical) worldliness can open itself on to the challenges of unpredictability, happenstance and struggle which any social world contains . The severance of the two modes of theory means that each becomes conformist . The critique of conformism belongs with theory which is practically reflexive (cf. Horkheimer, n .d . p . 229), since only a theory which thematises its own presence in society can make a question out of the way in which society proffers, as ideologies, categories whose seeming 'obviousness' suggests that they have only to be understood to be endorsed . This kind of false or socially-constructed obviousness can only be challenged by theorising which reflects on its own social involvement, i .e ., its own presence in the world of practice where ideologies are inscribed . Not even the most diluted and informal notion of philosophy as metatheory - for example the notion of philosophy as supplying 'a set of perspectives' can achieve the same, critical and interrogative, result . Left theory has indeed to take the questions raised by philosophy seriously, in order to be answerable for its categories and to understand its own way forward, but at its peril (at the peril of abnegating its critical standpoint) it takes them seriously in a philosophical way . Immanent critique To say, as I have said, that practically reflexive theorising overcomes the theory/metatheory separation is one thing . To say how it does so is another . Notice that, in order to be consistent with the above line of argument, we have to be able to say how it does so without construing practical reflexivity as a 'methodology' for its part . My suggestion is that the key to this difficult question lies in the circumstance that the modus vivendi of practically reflexive theorising is that of immanent critique . Again, some definitions help to clear the way . Critique calls into question the truth-claims and/or the categories of whatever view it interrogates : it refuses to succumb to obviousness which may be false, or to take claims at their face value . Out of its interrogation arises opposition, depending on the results which critical evaluations produce . External critique effects its interrogation by measuring a view's claims and/or categories against some pre-given conceptual yardstick, i .e ., against some truth-criterion presupposed as valid in advance . By contrast immanent critique operates by interrogating or challenging a view from within . It plays off a view against the view itself, for example by asking whether the conclusions drawn from the view's premises are consistent with one another and with the premises themselves . It does not impose its own truth-criteria on the view C&C 37-G

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criticised, as does external critique ; rather, it placed its own truthcriteria at issue within the critical engagement and develops itself (instead of merely reconfirming its own validity) in and through the process of critique it undertakes . The classic texts of immanent critique are Hegel's Phenomenology of Spirit and the critique of political economy unfolded in the Grundrisse and Capital of Marx . In the present connection, the relevance of immanent critique is that it does not presuppose the validity of any metatheory (any categorial basis from which critical pronouncements are delivered) but, in the critical process, places at issue the categories in terms of which it initiates the critical play . Put otherwise : immanent critique proceeds in the manner of 'good' conversation (Gunn, 1988c) . Immanent critique converses with its critical targets, in contrast to external critique which holds no brief for answerability in any conversational (or 'dialogical') sense . The programme of immanent critique turns on the Hegelian notion of intersubjectivity or 'recognition' (Hegel, 1977, p . 112 ; Gunn, 1988a) . External critique is for its part 'monological', and in the last instance throws intersubjectivity to the winds . In other words : the notion of conversation helps us to understand something of what immanent critique involves . At the opposite extreme from 'good' conversation there is conversation which is 'disappointing' or boring . Disappointing conversation restricts itself either to sheerly first-order points (e .g . 'Did X really murder Y?') or to sheerly external points (e .g . 'What counts as murder?') ; its mode is either empirical or philosophical but never both at the same time . On the other hand, good conversation allows first-order and metatheoretical points to interact, to inform one another and to unfold together : it is not two disconnected totalisations but one . As it were, the 'vertical' line of the distinction between its theoretical and metatheoretical dimensions and the 'horizontal' line of the distinction between conversational partners become a single line, without either of the conversational partners being allocated a sheerly theoretical or metatheoretical role and without the conversation itself becoming either sheerly metatheoretical or first-order as the case may be . 'Good' conversation is good rather than 'disappointing'- it does not merely chew over factual disputes or retreat into a play of disembodied concepts - because it, and it alone, allows conversational partners to challenge one another and to learn from one another in a fashion which brings all things about each partner into play . To discuss with someone whether or not they think it empirically true that it was X who murdered Y (and to discuss this alone) is to leave their conception of what constitutes 'murder' out of account ; to discuss with someone what they think constitutes 'murder' (and to discuss this alone) rapidly becomes, in the worst sense, academic unless we can also ask : 'Do you think for example that Stalin murdered

Marxism and philosophy Bukharin when he brought him to trial in 1938?' . We recognize our conversational partner - to employ this Hegelian expression once again - only when both theoretical and metatheoretical considerations are open to being conversationally addressed . And, as the example of Bukharin's execution signals, such recognition presupposes that theoretical and metatheoretical considerations are not held separate . We have to be able to say things like 'You define murder in such-andsuch a way? But then think of Bukharin!' and 'Yes of course Stalin was the cause of Bukharin's death ; but does it count as murder to do what Stalin did?' . In the flow (the totalisation) of 'good' conversation first- and second-order points inform one another and interact, and this interaction is part and parcel of the interaction - the play of recognition - between those amongst whom conversation occurs . What I have called 'good' conversation is, in fact, the most familiar instance of a theorisation which refuses to compartmentalise itself in a theory-as-distinct-from-metatheory sense . To be sure, as a 'local' shift within such a conversation, now-metatheoretical and now-theoretical questions may occupy centre-stage . But these shifts are indeed local ones . What conditions them is the appeal from the one level to the other, i .e ., the flow or totalisation of the recognitive conversation itself. As with conversation, so with immanent critique . Such critique plays off against one another all of the dimensions of the view it interrogates, including the theoretical and metatheoretical dimensions ; it does so by placing all of itself, including the adequacy of its own theory to its own metatheory and vice versa, at stake in the critical (the conversational) battle which it joins . There is more than a relation of analogy between 'good' conversation and immanent critique . The space of immanent critique just is the space of good conversation which also just is the space of the theory-metatheory totalisation . And so not three terms but one . The severance of theory from metatheory would in itself be sufficent to hedge the bets of immanent critique in such a way as to allow it to hold either its first-order truth-claims or its second-order categories and truth-criteria back from the play of critique itself. Thereby immanent critique would devolve back towards external critique . And so the notion of immanent critique has to be dialogical : one can play off the theoretical and metatheoretical dimensions of one's opponent's or partner's theorisation against one another only by throwing the relation of these two dimensions of one's own discourse into play as well . It is this dialogical aspect which transforms severance into totalisation . Conversely, 'good' conversation has to be immanently critical : it has to address the theory/metatheory articulation advertised in a conversation, not externally (i .e . dogmatically and monologically, in the light of a pre-given metatheory) but from within . Marxism has always become dogmatic when, as for example in

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Engels' Dialectics of Nature or Lenin's Materialism and Empiriocriticism, it has come forward in the guise of a philosophy . (I suggest that, all its differences from Engels-Lenin dialectical materialism notwithstanding, it is in this tradition of specifically philosophical Marxism that Critical Realism belongs .) In monological theorising, philosophy (construed as pure metatheory) and external critique find their common basis . And the positivism of a first-order theorising disconnected from its categorial self-reflection is their common heir . Engels' determinism and Lenin's Taylorism are the best-known instances of this heritage . Another such inheritance is 'structuralisi Marxism, which in the form of Jessop (see Jessop, 1988) completes my polemical circle by announcing itself to have Critical Realist philosophical roots . (The problem of 'Marxism and philosophy' was always a difficulty for structuralist Marxism : see note 3, above .) The first-order, or political, implications of Critical Realism remain to date unclear . Bhaskar (1988) talks of a 'transformational' and 'relational' approach to social relations, and appears to understand the politics of this in a New Social Movements sense . All this sounds welcoming . But, as is clear from the Communist Party's latest programmatic redraft (cf . Gunn, 1988b), a pluralist celebration of new social movements can all too easily make common cause with a technological determinism which might have enthused Engels himself. What guards against positivism, and its long historical flirtation with determinism, is practical reflexivity (understood as immanent critique) . If this is so, then the philosophical form of Bhaskar's re-opening of Marxist methodological questions supplies grounds for political disquiet rather than delight . On the score of dogmatism, finally, it can be noted that Marx himself theorises non-dogmatically because he theorises nonphilosophically . He theorises at once theoretically and metatheoretically because he theorises in the mode of immanent critique . His work on the critique of political economy from 1844 onwards records the process of a long, painful and severe conversation with his opponents, some of whom - for example the 'classical' economists and the 'left' Ricardians - become in the course of the conversation his partial friends . He throws against them all the charges that practical reflexivity entitles, but yet relates to them dialogically because he thematises the practical-rootedness of his own discourse for its part . He places himself on their terrain (the terrain of the practice of capitalism) in the same movement as he draws them on to his . Thus everything is at issue and nothing guaranteed in advance . Solely for this reason, without dogmatism the urgencies of class struggle can be seen as traversing not just Marxist practice but (cf. Cleaver, 1979 ; Negri, 1984) Marxist theorising itself.

Marxism and philosophy Immanent critique and practical reflexivity It remains to show why the approach of immanent critique is a practically reflexive one and vice versa . Practically reflexive theorising is immanently critical because it asks after the validity of its own categories in the course of understanding itself as practically situated . Inasmuch as it does these two things at once it has to place its own categories (and the truthclaims they entitle) at issue in the face of the theorising enunciated by its opponents, who share the same social and practical world . That is to say, it cannot confine itself to reporting the practical situatedness of its opponents - as state-sycophants or bourgeois apologists or whatever - in a purely 'third-person' fashion, as a bourgeois sociology of knowledge might do . It has to engage 'in the first person' with the views which, 'in the third person', it finds its own social world to contain : again, not two separate totalisations, but one, in which the first-person and the third-person moments interrogate and inform each other . Its debate within itself is also a debate with its opponents and vice versa . This means that practically reflexive critique has to be immanent critique (it has to be dialogically structured) since a critique which was merely external and third-person would omit the moment of 'in-the-course-of of self-risk . Only immanent critique achieves first-person openness . Indeed the recognitive depth of 'good' conversation - conversation able to cross the theory/metatheory boundary because it is able to bring all things about each partner into play as conversational topics - and the practical depth of practical reflexivity are one and the same : to ask about one's partner's definition of 'murder', to continue the above example, is also to ask about the practical situatedness of this partner (as 'bourgeois' or 'Stalinist' or neither, for example) in virtue of which some definition of 'murder' seems to carry obvious force . Conversely, to raise the topic of one's partner's practical situatedness is at the same time to signal one's own practical situatedness as a possible topic and so to place at issue the validity of the categories within which one has raised the topic on one's own behalf. The same point - practical reflexivity implies immanent criticism - can be arrived at by reflecting that it is an internal relation between theory and practice which is advocated by Marx . The notion of an external or causal theory-practice relation (as in base/ superstructure versions of Marxism : e .g . Cohen, 1978) entails that one approaches the theory which is to be practically situated in a purely third-person fashion, i .e ., without risk . The notion of internal relatedness, by contrast, takes out no such categorial insurance policies : this notion implies that it is in the course of thinking about practical situatedness that one thinks about validity . As already reported, the phrase 'in the course of carries with it the idea of

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openness in the first person to the challenges which one's social world (including the theoretical dimension of that world) presents . Just as practical reflexivity implies immanent criticism so, conversely, immanent criticism implies theorising of a practically reflexive kind . This is clear from what has just been said : rigorous recognitive - interaction holds open the possibility of raising dialogically the question of 'where one's opponent is coming from', i .e ., of who and what (socially speaking) they are . And since this question is raised dialogically it is a question whose force one appreciates as applied to oneself. Practical reflexivity and immanent critique form a single conceptual figure . Whenever they are separated, external critique and (its complement) a sociology of knowledge become the order of the day . The category which allows us to think the practical reflexivity/ immanent criticism interrrelation is that of theory's audience. (For a discussion of this category in relation to Hegel see Gunn, 1988a .) The notion of an audience is a practical category since, quite independently of any given theory's pathos or eloquence, an audience for the theory may or may not exist . If practically reflexive theorising is immanently critical and thereby dialogical, it must raise the question of its own validity in the course of projecting the notion of an audience whose response to it (or recognition of it) might validate it . And if immanently critical theory is practically reflective theory it has to pose the question of its audience in a directly social and political way . Only in the first instance does the audience for immanent critique consist of those against whom the critique is targetted ; the larger audience for such theorising consists of all those who, joining the conversation, are in a position to address the question of the validity of the critique concerned . This leads us to the paradox of a critical theory whose own practical reflexivity tells it that the audience for its points and categories is non-existent . This was the paradox of 'Frankfurt School' critical theory in the 1930s and 40s (cf . Horkheimer n .d . pp . 2201) . The further reflection of it is Ernst Bloch's notion of a not-yetexisting audience able to recognize itself in the 'militant optimism' of a revolutionary hope-principle (Bloch, 1986) and Sartre's notion of a 'virtual', as opposed to an empirically actual, public towards which radical literature might be addressed (Sartre, 1950) . Lukacs's distinction between 'imputed' and 'empirical' class consciousness (Lukacs, 1971 p . 51) amounts to an attempt to dissolve the paradox by placing it in the context of an evolutionary and developmental historical scheme . But the paradox is not to be dissolved so easily . In an estranged world, where is the audience whose freedom allows it to evaluate the truth of a theorisation premised upon, and aiming towards, estrangement's critique? Practically reflexive/immanently critical

Marxism and philosophy' theory thus turns on paradox wherever its own reflexivity compels it to acknowledge alienation as the order of the practical day . This paradox is not, however, a self-destructive or selfconsuming one . It would be self-consuming if the question of an audience were addressed solely in first-order and third-person terms : does or does not the audience obtain? But, if first-order points are already in themselves metatheoretical points, then theorisation can claim for itself the role of defining its own (possible) audience as it proceeds . And, if third-person points are already in themselves firstperson points, then theorisation can set out to conjure the audience to whom it makes its appeal . The condition of both of these moves is that the audience signalled is not one which is sheerly notional, ahistorical and ideal (as is, for example, the 'ideal speech situation' as described in at any rate Habermas's later works: e .g . Habermas, 1986 p . 90) . The theory which invokes the possibility of a not-yet-existing audience must be able to establish this possibility as one rooted in the contradictions of an existing social world . To this extent first-order and third-person points are methodologically indispensable : utopias must be historically and practically concrete utopias, as Bloch said . Once more : a totalisation and not a disconnection . In an estranged world critical theory must be counterfactual theory (cf . Horkheimer and Habermas) but, pace the later Habermas, the counterfactual claims raised by such a theory must be capable of redemption and validation via the conversation of an audience which at least in principle is able to make its appearance in practical, i .e . social and political, terms . For, as in Kant, the notion of a counterfactuality severed from history and practice only renews the fateful theory/ metatheory separation once more . Put differently, in terms which are 'practical' rather than 'theoretical' : estrangement, or alienation, is never a self-complete or seamless whole . Rather it is the movement of a contradiction . The 'real movement' of this contradiction is 'communism' (Marx, 1975, vol . 5 p . 49) . 'Communism is neither a teleology of the capitalist system nor its catastrophe . It is . . . thus a concept that we can only formulate within the form of the transition' (Negri, 1984 p . 165) . A note on methodology I said earlier that, on pain of self-contradiction, the modus vivendi of practically reflexive theorising must admit of being specified without its being specified as a methodology ; for it is on the theory/ metatheory severance that the idea of 'a methodology', no less than the idea of 'a philosophy', turns . I have specified the modus vivendi of practical reflexivity as that of immanent critique . Does immanent critique amount to a methodology for its part? The answer to this question is 'Yes' if, and only if, immanent

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critique fails to understand itself in a dialogical way . For then it can only count as a method which is to be externally applied . Transposing itself into the mode of external critique, it undermines itself . Methodology and external critique legitimise one another; immanent critique is critique in non-methodological guise . Arguably for this reason some of the best Hegelian scholars (Kojeve, 1969, p . 176 ; Dove, 1970) urge that it is precisely rejection of the idea of methodology which underpins the rigour of Hegel's thought . As it were, for Hegel, the openness-to-all-comers of good or 'recognitive' conversation makes possible a more severe testing of truth-claims than does any 'method' deployed - as all methods must be - in a more-or-less a priori sense . Michael Rosen, in a fascinating discussion of the internal logic of immanent critique (Rosen, 1982 Ch . 2), makes clear the difficulties which the notion of methodologically based critique involves . These difficulties turn on what Rosen calls the post festum paradox', viz ., the paradox of being able to evaluate the results of critique only by depending on these same results' validity ; this amounts to the vicious circularity of evaluating a method by its outcome while at the same time evaluating the outcome by the method . External critique may seem to avoid this vicious circularity, but only because (and to the extent that) it sheerly presupposes its own standards and criteria as beyond reproach . Immanent critique may seem to entail this vicious circularity, but in fact does so only to the extent that it embraces 'method' (and thereby contradicts itself) since, of course, once a method is pressed into service the question of whether the method is prior to its results or vice versa comes into play . Rosen is right in identifying the vicious circularity of methodological critique, but wrong in thinking that this viciousness is a problem for immanent critique per se as distinct from immanent critique in a methodologically debased form . For there is no question of what I have just called 'priority' for immanent critique properly understood, and it is only when the question of priority ('Which comes first?') gains purchase that scenarios of vicious circularity unfold . For immanent critique, it is not a matter of priority but of interaction (or totalisation) : as was stressed earlier in connection with practical reflexivity, both the categories and the object - as it were, the 'method' and the 'outcome' - of such theorising have something to say about one another ; neither has exclusive rights . And as we have also seen, this holds true for all 'good' conversation . Rosen's critique of immanent critique has therefore the following use-value : it serves to highlight what it is in immanent critique that allows it to pass through the meshes of his condemnatory net . Thus : immanent critique escapes the aporias of methodology by placing itself at issue within conversation . Methodology (a department, and perhaps the fulfilment, of philosophy) destroys conversation,

Marxism and philosophy unless it is forced down into the crucible - the totalisation - of conversation itself. In a sense, the only methodology of good conversation is that it has no methodology: all claims can be raised . Invocation of method is at most a moment in conversation, and most often a suspect one : it is not methodology which defines the parameters of rigorous conversation but vice versa . This openness on the part of good conversation - no categorial holds are barred corresponds to the Hegelian and Marxian perception of the individual, or conversational participant, as social and intersubjective through-and-through (Hegel, 1977, pp . 110-1 ; Marx, 1975, vol . 5 p . 4 Thesis VI) . Theorisation and practice ; theory and metatheory ; first- and third-person theorising ; practical reflexivity and immanent critique ; immanent critique and conversation ; all these form moments of a single totalisation in which the notion of methodology, like that of philosophy, has no place . And in case the notion of 'conversation' should seem too polite to capture the Marxist notion of class-hatred (Negri), this is to be noted : nothing is less polite than rigorous conversation pursued to its end . For Hegel, such conversation amounted to a 'drama of suspicion' (Gunn, 1988a) ; for Marx, famously, immanent critique plunges over into satire and vitriol . Noholds-barred conversation precludes none of this . Least of all does it mean that one's placing of oneself at issue entails deriving one's agenda and categories from those planted on enemy terrain . All that it means is that the dialogical condition of immanence is sustained and, thereby, the dogmatisms of philosophy and methodology are avoided . No-one says that one has to like the opponents whom, literally for the sake of argument, one agrees to respect . And no-one can say in advance where (into what issues of life-and-death struggle) good conversation may lead . Abstraction I should like to carry my account of the conceptual status of Marxist theorising one step further . The themes of practical reflexivity, immanent critique, etc ., are followed through by Marx into his understanding of abstraction . All theorising employs abstractions, Marxist theorising included . But Marx's abstractions, inhering as they do in a particular theoretical self-understanding (which I have attempted to explicate), take a quite specific form . For the purposes of clarifying this form we can say, schematically: abstractions are of two kinds . There are empiricist and there are determinate (sometimes also called substantive) abstractions (cf. for what follows Bonefeld, 1987c ; Gunn 1987b) . Of these two kinds, empiricist abstraction is the most familiar . Marx signals this notion, and offers it provisional endorsement, when in his 1857 Introduction to the Grundrisse he says that 'Production in general is an abstraction,

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but a rational abstraction insofar as it . . . fixes the common element [i .e . the common element in all modes of production] and thus saves us repetition' (Marx, 1973, p . 85) . The idea of production in general' is that it abstracts from concrete social circumstances, in the sense of leaving what makes them different from one another out of account . This notion of abstraction-from is the defining mark of abstraction in its empiricist sense . The notion of determinate abstraction is a less familiar one, and it is to this notion that the 1857 Introduction devotes the greater space . The example of determinate abstraction which Marx offers is that of labour' . Labour is, to be sure, an empiricist abstraction in the sense that all possible modes of production entail work : Capital Vol . I reports the production of use-values as the 'eternal, nature-imposed condition' of any conceivable form of social life (Marx, 1976, p . 194) . But labour is not just an empiricist abstraction . It is also a determinate abstraction because 'this very simple category . . . makes an historic appearance in its full intensity only in the most developed [i .e . in modern capitalist) conditions of society . By no means does it wade its way through all economic relations' (Marx, 1973, p . 103) . Labour as an empiricist abstraction is the genus under which historically specific forms of labour fall . Labour as a determinate abstraction is an historical (a capitalist) species of labour while remaining no less abstract than the genus for its part . Labour as a (determinate) abstraction makes its historical appearance only when commodity-production has been generalised . Capitalism itself, as a mode of social practice, effects the abstraction from concrete kinds of labour ; and so the abstraction has not merely a theoretical but a social and practical status, as anyone who sells the use of their labour-power discovers fast enough . Moreover, if abstract labour had merely a generic and not a socially specific existence, Marx's contention (1976, Ch . 1, section 2) that a contradiction obtains as between abstract and concrete labour would be unintelligible : for between a genus and its species no contradiction can occur . It is in the nature of a genus/species hierarchy that it becomes increasingly abstract the closer to its apex we move . It is the notion of this hierarchy that Marx challenges . Moreover, it is on the distinction between empiricist and determinate abstraction that his critique of political economy turns . Political economy, he urges, elides determinate with empiricist abstraction thereby understanding the abstract - or value-producing - labour of capitalism as the condition of all societies of whatever kind . Thereby all societies are construed as capitalist, or at least commodityproducing, societies : the hegemony of value becomes the order of any imaginable social day . Without entering into detailed textual discussion I should like to add, in parenthesis, a qualification to what has just been said . A good deal turns on how the category of 'labour' in the above example

Marxism and philosophy is understood . Labour as such is already an abstraction half-way towards empiricism . I suggest that Marx understands labour as, like capital, a social relation . In short it is the capital-labour relation . The determinate abstraction Marx calls 'labour is class struggle . 'Work which is liberated is liberation from work' (Negri, 1984, p . 165) . The political consequences of this qualification cannot be debated here . What can and must be debated is the significance of the idea of determinate abstraction in Marx's post-1857 writings . Labour, for Marx, is never labour as such . I said that Marx provisionally endorses the notion of empiricist abstraction . The force of this 'provisionally' is that Marx tells us that 'there is . . . no general production' (Marx, 1973, p . 86) . Thereby, he invites us to construe all abstraction, and all the categories of his own theorisation - 'labour and 'production' included - as determinate abstractions . Class, class-struggle and value have to be understood in this way . In the most logically radical sense, in other words, he places his own theory socially at issue (at issue within struggle) . Not merely do his categories have practical roots and practical effects : they have practical existence as well . If my earlier discussion of practical reflexivity and immanent critique is to be meaningful, therefore, its relation to the idea of determinate abstraction must be made clear . The relation concerned can be stated very simply . Practical reflexivity opens on to the notion of determinate abstraction (it makes it possible) ; and the notion of determinate abstraction presupposes that theorisation understand itself in a practically reflexive way . This is so because, in the first place, theorising which operates in terms of determinate abstraction has to be theoretical and metatheoretical at the same time . The categories in terms of which such theorising raises its truth-claims (e .g . labour, value, class) are the categories which that same theorising understands to be constitutive in practice of its social world . The categories which metatheoretically 'control' discourse are also the categories which at a first-order level discourse 'finds' . This articulation becomes nonsensical unless a theory-metatheory unity is possible, and it is this possibility which I have sought to establish above . And in the second place theorising which operates in terms of determinate abstraction has to be third-person and first-person at once . 'Labour', 'value', etc . have a third-person existence as part of a determinate social world, a world which (Marx, 1973 pp . 100-1) goes on existing whether it is theorised or not . But on the other hand categories, including practically existing ones, exist in the first person ; they can at least in principle be engaged with and understood . This requisite third-person/first-person unity was part of what, earlier, we saw the self-consistency of practically reflexive theorising to involve .

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The conditions of determinate abstraction and of practical reflexivity are accordingly one and the same . Only practical reflexivity (see above) effects the synthesis of theory with metatheory which determinate abstraction requires ; determinate abstraction for its part is the conceptual and political horizon towards which practically reflexive critique clears the way . And this tells us something about the trajectory of Marx's own thought . Marx thematizes practical reflexivity in (especially) his polemical writings of the 1840s and determinate abstraction in (especially) his critique of political economy in its post-1857 phase . The implication of the argument I have just proffered is that he thereby deepens rather than abandons his earlier insights . Pace Althusser for example (Althusser, 1969, pp . 338, 227-31), there is no 'break' in the development of his work. On the contrary a single totalisation ever-more-richly unfolds, viz ., a totalisation open on to practice . Marx pursues the implications of this totalisation - one which I have attempted schematically to reconstruct - not with breaks and jumps (Althusser) or with lacunae and gaps (Bhaskar) but self-consistently and from end to end .

Critique of Critical Realism (2)

As argued above, Critical Realism understands the theory-practice interrelation in a causal sense : the internal interrelatedness of a totalisation falls out with its horizon . And in virtue of this the question of categories' social and political entailments floats free from the question of their implications for truth . The 'in-the-course-of movement of practically reflexive theorising becomes unattainable . Bhaskar misses the notion of categories' practical existence, on which the notion of determinate abstraction turns . He misses it because he construes critique as philosophical critique . Determinate abstraction and Critical Realism stand at opposite conceptual poles . This has a specific political consequence, to which I shall draw attention only briefly . Determinate abstraction's understanding of abstractions as socially existing allows it to mount an ideology-critique which is directly, and at the same time, social critique . To criticise ideas just is to criticise practical relations ; and conversely . This is how classic Marxism has always understood the matter . But Critical Realism, lacking the moment of determinate abstraction, severs ideology-critique from the critique of society itself . The relation between the two becomes an external one, because their respective objects are understood as related in an external (a causal) way . Thereby, whether wittingly or not, Bhaskar lends the credence of his position to the view - perhaps more fashionable a decade ago than today - that the left has to fight an all-but-interminable 'war of position' (cf . Gramsci, 1971, pp . 235-43) against the ideologies of the right . The fight is indeed interminable as long as it goes forward merely ideologically since the line dividing the critique of ideas from

Marxism and philosophy

the critique of social conditions is a line drawn on rightist terrain . Already for Marx in 1844, by contrast, the 'weapon of criticism' and 'criticism by wapons' (Marx, 1975, vol . 3, p . 182) were internally linked . Determinate abstraction is his subsequent conceptual and political deepening of just this interconnection . It was towards this that his 1840s critique of Young Hegelian philosphical critique cleared the way . A purely ideological critique is politically impotent since it presupposes the validity of the separation of 'ideas' from 'actuality' which (to the status quo's advantage) allows practice to ignore the challenges theory presents . Critical critique becomes severed from political critique . Within the confines of the present article it is possible to state these points only generally, but nonetheless they serve to endorse my main contention : the philosophical separation of theory from metatheory, although apparently a technical and academic matter, is fatal for the political project of the left .

So far, I have not commented directly on what Bhaskar's Interlink article presents as being the central themes of a Critical Realist approach . My reasons for this indirection were made clear in my introductory remarks . But now some pivotal doctrines of Critical Realism can be placed, polemically, on centre-stage . Bhaskar tells us that Critical Realism is concerned to 'identify the structures at work which generate . . . events and discourses' ; we are invited to recognize that 'there are enduring structures and generative mechanisms underlying and producing observable phenomena and events' (Bhaskar et al. 1988 ; for a further development of the same points see Bhaskar, 1975, esp . Ch . 1 : the terminology is more or less unchanged 5 ) . The difficulty with these seemingly innocuous formalae is that they involve us in tautology . On the one hand there are observable phenomena, on the other generative mechanisms . The criterion for truthfully identifying a generative mechanism is that it successfully explains (or at least renders intelligible) the phenomena . But the criterion for truthfully identifying the phenomena can only be appeal to some generative mechanism . The first of these points may be readily granted but the second is more contentious ; and so let me explain. There is no such thing - it is banal to state this - as a 'brute' (a category-neutral) fact . Facts, and thereby descriptions and identifications of phenomena, count as such only within some categorial framework . In the natural sciences, it may seem that the identification of facts is unproblematic (either the litmus paper turns red or it doesn't) but in the social sciences there is a further question of ideological mystification to take into account . For in the first place mystifying categories - e .g . 'abstract labour'- may, as determinate abstractions, be socially real . (It is not necessarily just us who are mystified about

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society ; society may be mystifying for its part .) And so, in the second place, what we count to be a fact will depend on the theorisation - in Bhaskar's terms the specification of 'generative mechanisms' - which we endorse . There is no such thing as a social litmus-test (although even in natural science the seemingly straightforward matter of litmus-testing gives rise to categorial problems of its own : Kuhn, 1962) . And it is in this way, I take it, that Critical Realism is critical : it refuses to accept appearances at their face value as though they were givens of a 'brute' kind . It is interested in generative mechanisms or structures which 'are not spontaneously apparent in the observable pattern of events' (Bhaskar et al . 1988), and so distinguishes truthful from misleading appearances in the light of the generative mechanisms which it finds . But then appearances become the criterion of generative mechanisms (of reality) while generative mechanisms (reality again) become the criterion of phenomena or appearances . We can evaluate claims about reality only in the light of claims about appearance and vice versa. In formal terms : tautology is the outcome . Less formally : we are sent from pillar to post . These problems affect not just a Critical Realist account of social science but a Critical Realist account of natural science as well . On a Critical Realist approach, natural science escapes tautology (cf . Hegel, 1977, pp . 94-5) if and only if the categories in terms of which observable 'facts' are identified can be specified independently of the categories in terms of which the generative mechanisms serving to explain these facts are specified for their part . This may seem a simple enough requirement, and yet in the history of science it has never been met . To Alexandre Koyre (1978), and after him to Husserl (1970, pp . 48-9), we owe the demonstration that the rise of modern natural science relied on an idealised 'mathematization' of space and time which was not itself something empirically discoverable but which, on the contrary, was a categorial presupposition ofscientific explanations turning on the notion of predictability (in the sense of all causes, everywhere and everywhen, having the same effects) . Space and time become homogenised at the start of the modern period - they become abstracted from the qualitative space and time of the everyday lifeworld - by natural science on the one hand and by the exchangerelation (cf. Adorn, 1973) on the other . To the same effect, the early-modern philosophers of science - John Locke, for example treat only those experiential qualities which can be quantified (e .g . distance but not scent) as fully real . In short science has always precast, in its own categories, the 'observable phenomena and events' which it explains . Certainly this is not an objection to natural science as such inasmuch as, in numerous cases, a tautologous statement can be informative and to the point . But it is an objection to a philosophy of science since, from such a theorisation, we might hope at least to discover how and why it is that science's tautologies are of an

Marxism and philosophy informative kind . Critical Realism repeats science's tautology, perhaps faithfully, but without casting light upon it . The tautology which should be its subject-matter becomes the tautology of its discourse itself. Like the dilemma 'vicious circularity or infinite regress?', tautology is the vice of discourse from which the notion of totalisation is absent . A totalising discourse addressing epistemological problems of natural science would attempt to show how mathematization and observation interact as moments of the same project, for better or for worse . My criticism of Critical Realism's central doctrines relates to my criticism of it as a 'philosophy', this latter being the argument on which the present paper has turned . Appearance and reality Is it an accident that Critical Realism becomes trammelled in the problems of tautology? I suggest that it is not . Once more, as just signalled, the problem stems from a disregard of the totalisation on which Marx (tegether with Hegal) set store . Wherever appearance and reality are severed from, and dualistically counterposed against, one another the danger of tautology looms . We experience 'only appearances' ; reality is 'something else' . If this is so then only appearances can serve as a guide to reality ; and only reality can serve as the yardstick against which - unless we are willing to say that no appearances can be mystifying or misleading - appearance is to be judged . Vicious circularity/infinite regress ; theory/metatheory . In just the same way : tautology is the nemesis which an appearance/reality severance has to confront. This reflection enables us to report one further moment in the theoretical totalisation which Marx, following upon Hegel, attempts . Historically speaking, the appearance/reality severance goes hand in hand with the rise of natural science and that of the exchangerelation . The Ancient world did not see the relation of appearance to reality in the same terms . The pre-Socratic philosopher Anaxagoras characterised appearances, or phenomena, as 'a glimpse of the obscure' (cit . Kirk & Raven, 1960, p . 394) . He meant that what is revealed in and through appearances (viz . reality or 'being') was irreducible to them while at the same time being internally linked with them : as it were, it is no accident that reality appears (even misleadingly) thus-and-thus . To be sure, Anaxagoras is replying to Parmenides, who counterposes the 'way of seeming' against the 'way of being' (Kirk & Raven, 1960 Ch . 10) in a thoroughly dualistic sense . To be sure, too, Plato is more faithful on this score to Parmenides than to Anaxagoras ; but even Plato, in his Republic (50911 in the standard citation) agrees to construe appearance and reality

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as two segments of one and the same divided line . That is, he allows their internal relation (the unity of the line) to be primary . It is in the modern - the capitalist and natural-scientific - world that the idea of a pure external relation of appearance to reality comes to the fore. And again, as in the case of the theory/metatheory severance, it is Hegel and Marx who attempt to re-establish unity and internal-relatedness albeit on a non-cosmological ground . Plato could presuppose a unity of appearance and reality because he presupposed a cosmos to whose meaningful order the philosopher might assimilate himself (Republic 500c-e): there had to be an assured ladder leading from appearance to truth . Marx and Hegal presume no such cosmos but, instead (and construing even natural appearances as ones which are socially constructed), address the appearance-reality relation on a solely practical terrain . Hegel declares that 'essence [in the context of the present argument : reality) must appear : 'Essence is not something beyond or behind appearance' while appearance, for its part, is not a mere illusion of 'show' (Hegel, 1874, para . 131 ; cf. Lukacs, 1979 on 'determinations of reflection') . Marx too, although he is famous for having penetrated through appearance to underlying reality, thinks of appearance as the mode in which the capital-labour relation exists (e .g . the reference to the world-market at Marx, 1966, p . 110; cf. Negri, 1984 on 'social capital') . Thus : exchange-value is the mode of existence of value, and money the mode of existence of exchangevalue . Social structures are themselves the mode of existence of action and struggle : structures are struggles existing in the mode of being denied (cf. Gunn, 1987b ; and as background Hegel, 1977, pp . 263-4). The ossification of structure is the appearance which overlies the reality of struggle, as the opening sentence of the Communist Manifesto reports, but once again there is just a single totalisation (whose key is struggle) and not two . As it were : social structures are non-existent, but they are non-existent in the mode of being real . The movement from the first to the third volumes of Marx's Capital is - all this being so not a move from reality to unreality, or from production to ideology, but an increasingly concrete picture of what the mode of existence of capital involves . The same point can be made by saying that the famous 'abstractions' of Volume One are abstractions of a determinate kind . In other words Marx (and Hegel) argue for just the internal relatedness of appearance and reality from whose absence Critical Realism's trammelment with tautology stems . Tautology arose because two allegedly separate things were supposed to make sense of one another, within a causal-explanatory frame . An internal as distinct from an external relation between appearance and reality overcomes tautology by understanding these two things, precisely in their difference, as one . Nothing is explained by anything else or, put



Marxism and philosophy

differently, there are no 'generative mechanisms' . Instead there is determinate abstraction : the existence of unity in difference and of the abstract in the concrete . The notion of determinate abstraction is the totalisation of appearance and essence . Theory forecloses on practice in the same movement as, minus determinate abstraction but plus philosophy, it understands itself as the most surface level of appearance itself. Every 'in-the-course-of becomes disrupted . No doubt despite Bhaskar's intentions, the aged base/superstructure metaphor becomes the order of the discursive day .

* If not, why not? Certainly Marx says things which tell against my argument : for example he advises us to 'leave philosophy aside' and, in the opening pages of Capital, he sets out a putative deduction of a labour theory of value which is not only fallacious in its own terms (e.g . Bohm-Bawerk, 1975, pp . 68-80) but which has the consequence of presenting 'labour' as an abstraction not of a determinate but an empiricist kind . The immeasurable richness of what Marx does is, however, something else again . It is on these riches that I have attempted to concentrate . In the 1980s it is fashionable to say that they are exhausted : that we live in a post-Marxist world . The more friendly version of this thesis is to proffer to Marx all kinds of aid . Bhaskar supplies the oxygen-mask of philosophy . Others advertise the crutches of Rational Choice . 6 Still others assimilate Marxism to a bourgeois sociology of inert structures . The answer to the question 'If not, why not?' is twofold . The first part of it turns on emphasising that an external or 'causalist' disconnection of theory from practice, as in the base/superstructure metaphor or a thousand other versions of sociological and philosophical determinism, has not the least in common with the discourse of totalisation we are still able to recover from Marx's works . Bhaskar et al. (1988) offer to overcome the dichotomy within Marxism of 'fundamentalism versus revisionism', but this is perhaps their most suspect procurement since fundamentalist readings of Marx had, at least, the virtue of being readings of a careful kind . And the second part of my answer is still more straightforward . Our own weakness may not be Marx's . To insist that a healthy ambulant walk with crutches (in Marx's case the crutches of philosophy) is to require that he flatter an audience, whose applause he might well have regarded as anathema, by falling over his own theoretical feet .

Critical Realism's offer of a philosophical reformulation of Marxism * seems obviously helpful, but in fact, as I have shown, is not.

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1. E .g . Althusser . 1970 p . 59, where we are told that `theoretical practice [first-order 'science'] is . . . its own criterion' only to learn that this thesis is restricted to sciences 'once they are truly constituted and developed' . Is it science itself which decides that it is truly constituted? More precisely: relativism consists in the inference that since 2. viewpoints differ categorially therefore compelling argument across the boundaries of category-systems is impossible . For an argument which accepts the premise but resists the inference from it, see Gunn, 1988c . 'Philosophy' has equivocated on this issue . In its most hubristic 3. moments it has reserved all rights to metatheory . In its more modest guise the guise of science's 'underlabourer' - it has confined itself to clearing what science declares to be rubbish from science's path . Althusset s shifting formulations on 'philosophy' moved, over a number of years, from the 'hubristic' to the 'modest' view . My contention is that this shiftiness is intrinsic to philosophy . At each of its stages, including its most self-effacing ones, the same dilemmas are reproduced . This somewhat laborious definition of 'critique' is directed against 4. John Holloway, according to whom (e.g . Holloway, 1988) it is out of opposition that there arises critique. The problems of relativism entailed by seeing the opposition/critique relation this way round are formidable . Critique becomes merely the rhetoric attendant upon feeling pissed off . The retreat into an aesthetic basis for critique in Holloway, 1988 is therefore unsurprising, and indeed has an all-too-postmodernist ring . One terminological change should however be noted . What Bhaskar 5. now calls 'critical' realism he used to call 'transcendental' realism (Bhasker, 1975 p . 25). In other words, as in just about all philosophy of science, the inspiration is Kant . For a sharp comment on the relation of Kantian critique to Hegelian-Marxist critique see Bubner, 1982 . Although a critique of Rational Choice Marxism falls outside the 6. bounds of the present paper, it is worth pointing out that it is on the theory/ metatheory separation that the case for Rational Choice depends . Jon Elster rejects the view that 'methodological individualism . . . must go together with an assumption of universal selfishness' (Elster, 1986 p . 209 ; cf. Elster, 1985 Ch . 1) not least in order to distance his individualism from that condemned outright by Marx (1976, p . 284) . Despite this he says that there is a methodological presumption in favour of attributing selfish motives to individuals inasmuch as-allegedly-altruism is parasitic on selfishness rather than vice versa . The arguments for and against this kind of lunacy are decidedly avoidable . I wish only to stress that Elster's case for distinguishing real selfishness from methodological selfishness, and thereby the entirety of his case for a Rational Choice Marx-reconstruction, self-evidently turns on the idea of a theory/metatheory separation once more . We are supposed to be atomised and self-interested agents only as a matter of methodology, apparently, and not as a matter of first-order and social fact .



Marxism and philosophy Adorno, T .W . (1973) Negative Dialectics . Routledge and Kegan Paul . Althusser, L. (1969) For Marx . Allen Lane . Althusser, L . (1970) Reading Capital. New Left Books . Bhaskar, R . (1975) A Realist Theory of Science . Books . Bhaskar, R . et al . (1988) 'Philosophical Underlabouring' Interlink 8 . Bloch, E . (1986) The Principle of Hope . Blackwell . Bohm-Bawerk, E . (1975) Karl Marx and the Close of His System . Merlin Press . Bonefeld, W . (1987a) 'Open Marxism' Common Sense 1 . Bonefeld, W . (1987b) 'Reformulation of State Theory' Capital and Class 33 . Bonefeld, W. (1987c) 'Marxism and the Concept of Mediation' Common Sense 2. Bubner, R . (1982)'Habermas's Concept of Critical Theory' in Thompson J .B . & Held D . (eds) Habermas : Critical Debates . Macmillan . Cleaver, H . (1979) Reading 'Capital' Politically . University of Texas Press . Cohen, G .A . (1978) Karl Marx's Theory of History : A Defence . Oxford University Press . Davie, G .E . (1986) The Crisis of the Democratic Intellect. Polygon Books . Dove, K . R . (1970) 'Hegel's Phenomenological Method' Review ofMetaphysics . Vol . XXIII . Elster, J . (1985) Making Sense of Marx . Cambridge University Press . Elster, J . (1986) 'Further Thoughts on Marxism, Functionalism and Game Theory' in Roemer, J . (ed .) Analytical Marxism . Cambridge University Press . Geras, N . (1972) 'Marx and the Critique of Political Economy' in Blackburn, R. (ed .) Ideology in Social Science . Fontana/Collins . Gramsci, A . (1971) Selections from the Prison Notebooks . Lawrence and Wishart . Gunn, R. (1987a) 'Practical Reflexivity in Marx' . Common Sense 1 . Gunn, R . (1987b) 'Marxism and Mediation' Common Sense 2 . Gunn, R . (1987c)'George Davie : Common Sense, Hegelianism and Critique' Cencrastus 27 . Gunn, R . (1988a) 'Recognition in Hegel's Phenomenology of Spirit' Common Sense

4. Gunn, R . (1988b) 'Facing Up to the Communist Party' Common Sense 6 (forthcoming) . Gunn, R . (1988c) 'In Defence of a Consensus Theory of Truth' (unpublished MS) . Habermas, J . (1986) Autonomy and Solidarity . Verso Books . Hegel, G .W .F . (1874) The Logic of Hegel. Clarendon Press . Hegel, G .W .F . (1977) Phenomenology of Spirit . Oxford University Press . Holloway, J . (1988) 'An Introduction to Capital: or, How I Fell in Love with a Ballerina' Common Sense 5 . Horkheimer, M . (n .d .) Critical Theory : Selected Essays . Seabury Press . Husserl, E . (1970) The Crisis of European Sciences Northwestern University Press . Jessop, B . (1988) Paper to conference on Regulation Theory, Barcelona . Kirk, G .S . & Raven, J .E. (1960) The Presocratic Philosophers Cambridge University Press . Kojeve, A . (1969) Introduction to the Reading of Hegel. Basic Books . Korsch, K. (1970) Marxism and Philosophy New Left Books . Koyre, A . (1978) Galileo Studies Harvester Press/Humanities Press .

References

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Kuhn, T .S . (1962) The Structure of Scientific Revolutions University of Chicago Press . Lukacs, G . (1971) History and Class Consciousness . Merlin Press. Lukacs, G. (1979) Ontology of Social Being : (1) Hegel . Merlin Press . Marx, K. (1973) Grundrisse . Penguin Books . Marx, K. & Engels, F. (1975) Collected Works . Lawrence and Wishart . Marx, K. (1976) Capital Vol . I Penguin Books . Marx, K . (1966) Capital Vol . III Progress Publishers . Negri, A. (1984) Marx beyond Marx : Lessons on the Grundrisse . Bergin and Garvey . Plant, R . (1988) Citizenship, Rights and Socialism . Fabian Society Pamphlet 531 . Rosen, M . (1982) Hegel's Dialectic and Its Criticism . Cambridge University Press . Sartre, J .-P . (1950) What Is Literature? . Methuen .

Peter Alcock Unconditional benefits : misplaced optimism in income maintenance Social dividends back on the agenda

• Social dividends are not a new idea . Indeed the concept of a guaranteed income, sufficient to provide for a decent standard of living, paid by the state to all individuals irrespective of personal circumstances is really a very old adaptation of the communist maxim, from each according to ability to each according to need . It is a demand for a society in which dependence upon wage labour is not necessary in order to secure subsistence, and in which, therefore, the power of capital has been replaced by a collective commitment to provide unconditional support for all . In this sense it is something of a utopian demand, or at least one which has to be predicated upon a major transformation of existing capitalist society . In the harsh enterprise culture of Thatcherite Britain, however, it is an idea which is increasingly being presented on the left as a feasible (indeed the only feasible) strategy for income maintenance to counter to the divisiveness of the two-thirds/one-third society . As the article by Gray demonstrates, this utopian dream is predicated upon assumptions about radical changes in the social and economic climate of Britain in the 1990s and upon the need for the labour movement to develop radical new social and economic policies to respond to this . As Gray points out, the most pressing change in the social and economic fortunes of labour is the declining power of workers both individually and collectively . The government's legislative attacks on

In this article the author critically examines the arguments for and against universal, unconditional social benefits .

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the organised labour movement, together with the fostering and continuation of high levels of unemployment have severely weakened a labour movement, which in the early decades of the post-war welfare state was able to extract significant advances in both the individual and the social wage . With persistent high levels of unemployment in most parts of the country, this is no longer possible . The problem of reconciling means-tested benefits with low wages and the incentive to work has always been a difficult feature of the reconciliation of social and economic policy for post-war governments . In the 1960s reconciliation was attempted via the wage stop, which reduced benefit entitlement below anticipated wage levels . In the 1970s this was replaced by the use of means-tested benefits to subsidise low wages, notably Family Income Supplement (Fis) for workers with children . However, the separate planning and operation of Fis meant that there was still a problem of overlap between it and means-tested benefits for the unemployed, leading to the problem of determining whether individuals would be better off claiming the former or the latter . This was referred to by the government as the Unemployment Trap. Means-tested subsidies to low wages also cause the Poverty Trap for those who receive them ; since they are related to income, they must be withdrawn as income rises, reducing the real advantage of any rise . When taken together with the taxes also paid on wage rises, the withdrawal of benefits could lead to effective marginal tax rates on increased income of over 10076, thus trapping recipients in poverty . The aim of the 1986 reforms of social security, introduced in April 1988, was to rationalise the relation between different meanstested (now called income-related) benefits, and align the entitlement to benefits for the unemployed with the levels of support for those on low wages . Now the means-tests for Income Support, Family Credit (which replaced Fis) and Housing Benefit are all set at the same level against the net wages of those in full-time work . For those at this level the maximum subsidy is paid, for those above it the subsidy is gradually reduced . This means, in effect, that people with children or with housing costs are always going to be better off in full-time work, whatever the wages received (and for those with neither, predominantly the under 25s, benefit levels are so low that this is still most likely to be the case) . Claimant Advisers in social security offices, who have replaced the unpopular Unemployment Review Officers, are now advised to explain these advantages of wage subsidisation to those who have been unemployed for long periods of time - although perhaps more explanation is needed, since early indications are that the take-up rate for Family Credit is no better than the 50% (non)-take-up rate experienced by FIS . The carrot of means-tested wage subsidy therefore now

Unconditional benefits accompanies effectively the stick of stricter availability for work testing in encouraging people into low wage employment . And where such employment is not available, the new Employment Training (ET) can be offered . E T rates are related to entitlement to means-tested benefits for the unemployed, by the benefits plus principle . The rates of pay under the old Community Programme training were too low to raise participants' potential income above Income Support level where dependent children were involved, thus providing no incentive to undertake placements ; this should never be the case with ET . At present there are no plans to enforce compulsory training placements on the us workfare model . But the Employment Act 1988 gives the Secretary of State for Employment the power to introduce such compulsion in the future ; and, in the Parliamentary debates on the Bill, Norman Fowler refused to give a guarantee that he would not utilise such a power at some time in the future . As Gray is aware, the logical consequence of the joint planning of means-tested support for training and employment with benefits withdrawn rapidly when, or if, wages rise is the transition to a fullblown Negative Income Tax (NIT) model for state support . The idea behind NIT is the use of taxation policy to determine not only income tax liability, but also entitlement to means-tested benefit support (which could be paid as a form of negative tax or tax credit) . The same means-test would thus apply to everybody, much simplifying administration - and confirming the centrality of the means-testing principle . Social dividends have generally been contrasted with NIT, because, by providing an unconditional payment automatically to all, they imply an abandonment of means-testing . If dividends were to be paid to workers as a tax credit, as suggested in some dividend schemes, then, as Collard (1980) argued, the practical effect of the two might be rather similar . Negative Income Tax was part of Conservative Party policy in the early 1970s and more recently it has been advocated by the Adam Smith Institute (As!, 1984) and the Institute for Fiscal Studies, albeit in a modified form (Dilnot et al ., 1984) . And it is in part the anticipation, or fear, that the Government will move rapidly in the 1990s towards such full-scale integration of taxes, benefits and wages which has inspired Gray and others to argue that the left must respond with an equally comprehensive replacement of post-war wisdom in social security . Gray's argument rests on the assumption that socialist strategies for employment and social security policy should recognise, and respond to, the fact that with developments in new technology and other changes there can be no hope in the future for a return to full employment . Thus new `mobilising demands' are needed, such as the demand for an unconditional benefit (social dividend) to be paid to all, irrespective of employment status, and guaranteeing a minimum

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standard of living throughout the state . An unconditional benefit would significantly shift the balance of power in employment relations towards the working class, by freeing them of the need to labour in order to survive . It would involve a major shift of resources away from capital towards the broader working class . And by abandoning the work ethic it would strengthen the fight against availability for work testing and workfare, and would unite workers with the unemployed in a struggle over the new social wage .

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The advantages of social dividends

The idea of a guaranteed income for all certainly offers the kind of socialist goal which could achieve a genuine level of unity and equality so obviously lacking in post-war social policy developments . Such a demand could also unify the struggle for socialism by bridging the ideological and political gap which has traditionally separated paid, unpaid and unemployed labour (see Mann, 1986) . Furthermore by guaranteeing subsistence for all individuals irrespective of labour market position social dividends would remove women's reliance upon men's wages, and permit anyone who wished to to undertake caring work without fear of dependence or destitution . Social dividends also appear to offer practical political gains too . By removing the existing state subsidy to low wages, they would discourage employers from paying these . And by guaranteeing subsistence needs before the receipt of wages, they would give workers the power to refuse badly paid or otherwise unattractive jobs, thus forcing employers to improve their side of the wage labour bargain . This new found individual strength for workers would also restore power and confidence to the collective organisations of the labour movement, strengthening their ability to carry forward the push towards socialist transformation .

The principle of a guaranteed income

The image of a society which provides, automatically, for all its citizens an income adequate enough to secure a reasonable standard of living does indeed seem to be an attractive one . The need to labour in order to live will have been dispensed with, and consequently the power of the capitalist over the woker vanquished forever . In such a society paid employment would be a matter for genuine choice, and presumably would only be chosen where pay and conditions were sufficiently attractive to arouse the interest of potential workers . Economic divisions based on class and gender would no longer be relevant and all individuals would be free to share their lives with others (or not) as they wished . Although such a vision may appear hopelessly utopian, is has been argued increasingly widely in recent years that developments in technology leading to the demise of the need for productive labour

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and the abandonment of policies for full employment, make it not only a desirable, but also an achievable, even an inevitable, goal (Keane & Owens, 1986) . In perhaps the most influential text dealing with the principles of guaranteed incomes, Andre Gorz (1982), argued that social and economic changes, notably in relations of production, had made the proletarian road to socialism obsolete (workers now had too much invested in the capitalist social order), and therefore it was only in a post-work, post-working class, future that equality and freedom from oppression could be achieved . This future was the legacy of the rapidly growing non-working class of late capitalism, in which their interest in a guaranteed income from the state would become the unifying interest of all . As Rustin (1987) discusses, however, this utopian vision is not without its contradictions . The contradictions of a world where productive labour could be considered an optional extra for all is difficult to conceptualise, even at the level of fantasy at which Gorz's analysis largely remains . And yet it is just this break with the social obligation of the work ethic which more pragmatic protagonists such as Gray (1988) and Costello (1986) argue is what makes the demand for social dividends a principle which can be the basis for social and economic policy change in the harsh Thatcherite world of the 1980s and 1990s .

For Gray, and others, therefore the attractive feature of social dividends is that in practice, as well as in principle, they serve both to unify the working class and to revitalise its economic and political strength . These aims will be achieved, it is hoped, by giving all a direct interest in the provision of state guaranteed income ; and by ensuring that workers, because of their receipt of guaranteed income, will be able to resist low waged or otherwise unattractive employment . Dividends thus provide new political goals for reform - the unification of a divided working class and the creation of responsibility within the state to guarantee adequate support for all . They also provide the means of reform, by strengthening workers both individually and collectively in their struggle against oppressive relations of waged employment . However, as the rather disparate nature of support for dividends referred to earlier suggests, not all forms of social dividend proposals do guarantee the political aims of a society in which the state provides for all major needs . And the use of dividends as a catalyst in the struggle between wage labour and capital is a strategy based upon major contradictory tendencies . The first, and most important, problem in any proposed scheme for state guaranteed unconditional benefits is that of the level of benefit to be paid, and the means of financing it . If it is to provide a

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relatively high standard of life for all, as demanded by left and libertarian protagonists such as the Federation of Claimants Unions (Fcu, 1984), then it would need to be set at around the level of current average wages . The cost of providing an income based on average wages to all now would be astronomical compared to current expenditure on benefits and wage support . It would also, of course, be ultimately self-defeating, since the average would no longer be meaningful and inflationary wage rises seeking to restore differentials could rapidly render it devalued . Few of the pragmatic supporters of dividends would advocate such a radical step towards equality; although in abandoning it their claims for unity with the dispossessed become more than a little dubious . For those currently on inadequate state benefits the only real attraction of a new social dividend paid to all is if it is significantly more generous, relatively speaking, than existing benefit levels . Conservative supporters of social dividends, such as Parker (1984), have costed their proposals much more carefully and cautiously . Their primary aim is not to replace wages for employment with state support for all ; but merely to remove the poverty trap currently produced by means-tested support to low wages . As referred to above, the poverty trap is an inevitable consequence of meanstested subsidisation of low wages . Since subsidies are related to means, they must be withdrawn when, or if, wages rise, leading to high marginal tax rates and serious disincentive problems for workers on low wages (see Alcock, 1987, Ch . 9 and Deacon & Bradshaw, 1983, Ch . 8) . Replacing subsidies with flat rate dividends for all would ensure that all wages therefore provided a positive incentive to undertake paid employment . Gray refers to this as the labour supply increase strategy . In order to achieve such an aim dividend levels would have to be relatively low to ensure a positive incentive to undertake waged employment . Parker sets them at below the then current Supplementary Benefit level . For those not in paid employment therefore, there would need to be means-tested additions to avoid destitution . If these are paid only to the unemployed, however, they may raise their income from benefits above that potentially realisable in paid employment, thus recreating an unemployment trap . And it was to avoid just this that the means-tested, wage subsidy/poverty trap, benefits were introduced in the first place . In such a scheme all the socialist goals of guaranteed income are subverted in order to continue serving the needs of a capitalist labour market, and all the disadvantages of means-tested support for those outside of the market remain - complexity, confusion, ignorance, stigma and low take-up (see Alcock, 1987, Ch . 9) . Nevertheless, in order to support a dividend of this meagre level Parker estimates that income tax rates of 40176 and above would be needed on all earned

Unconditional benefits income. this would significantly dent the incentive effect of a guaranteed income, and cast into doubt its political viability, especially in a climate in which Thatcherite policies of tax cutting will have made tax rates of 25% for all appear achievable and desirable . Gray's demand is that social dividends should, at least, preserve the real value of existing support for the unwaged . In other words the transfer to state benefits for all should not lead to any cut in entitlement for existing claimants . The recent Government simplifications of benefits have at least made this a more readily achievable goal in the short term, by removing the complex needs-related additions to means-tested support in the new Income Support scheme. However, as suggested above, they have also revealed its rather modest aims . Few of those on the labour left or within the socalled poverty lobby would wish to lend much support to a socialist reform of benefits which was merely going to maintain them at existing levels, and such a call is hardly likely to attract much support amongst claimants themselves . However, as we have seen above, the costs of significant increases in the basic income level would not be bearable within currently predictable financial and political constraints because of the need to pay the increased guaranteed income to all . Furthermore on the face of it a social dividend paid at current benefit levels would not significantly alter the circumstances of those currently on low wages, for whom the new rules on entitlement to Family Credit and Housing Benefit now ensure that even low wages are already above potential Income Support entitlement . It is not so much its advantages for existing claimants, however, which attracts recent supporters to the idea of a social dividend ; but rather its presumed effect on the employed working class . Gray attaches four conditions to the introduction of any progressive form of unconditional benefit, 'It would need to : 1 . preserve the real value of existing support for the unwaged ; 2 . maintain benefits at the same level regardless of employment status ; 3 . exclude means-testing and withdrawal of the benefit as earnings rise ; 4 . exclude availability for work testing .' (1988, p . 134) . If these are all met, it is claimed, then the current experience of those on low wages - the direct or indirect compulsion to work and the punitive loss of any wage increases through the high marginal taxation effects of the withdrawal of means-tested benefits - would be transformed . Workers would no longer need to work for low wages and could refuse jobs if the wages or other conditions were not

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attractive enough to tempt them to top up their state guaranteed income by employment. This would lead to a net fall in the supply of labour, helping to eliminate the reserve army and to restore the bargaining strength of individuals and trade unions (Gray, 1988, p . 139) . This leads onto the second major problem with the strategy for social dividends, however. With state guaranteed flat-rate benefits replacing means-tested support for those on low wages there is no guarantee that the short-term benefits of such a change would not accrue largely to employers . If there was no longer any need to pay even subsistence wages to their employees because of the social dividend, then many employers may well be quick to realise a massive reduction in the immediate costs of labour . Given the potential inflationary effect of dividends on wage levels, referred to above, this need not take the form of cash cuts in wages - merely a shift in the agenda for wage bargaining away from subsistence . As non-socialist social dividend protagonists such as Parker (1984) and Ashby (1984) have argued, this might well lead to an overall reduction in wage levels and to an increase in labour supply as workers are priced into jobs . Gray admits that these are possible effects of the introduction of social dividends . Her prediction of a fall in the supply of labour is only presented as 'probable' (p . 139) . Even that may be an optimistic judgement, however ; and yet without it the whole of the strategic attraction of dividends as a weapon in the economic struggle is lost - or rather, even worse, it passes over to the other side . To prevent such undesirable labour market effects of social dividends Gray suggests that they be accompanied by the introduction of statutory wage protection . A national minimum wage would ensure that employers continued to carry a significant cost of the reproduction of their labour power and would prevent the pricinginto-jobs tendency of dividends to increase labour supply . Here, however, the contradictory practical implications of social dividends begin to come, inexorably, to the fore . If the practical attraction of social dividends for the working class is that they will free individual labourers to refuse poorly remunerated work and thus strengthen the collective organs of the labour movement, then why is statutory control over employers necessary in order to ensure this? Furthermore, if the state is to set the level at which wages are to act as an improvement on social dividends, as well as setting the levels of the dividends themselves, then what freedom will capital and labour have at all over the labour process? And yet it is into the existing arena of a largely uncontrolled capital/labour market that dividends are intended to make such an important political and economic impact . These are crucial questions for the supporters of social dividends

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to face for they point to a major contradiction at the heart of the unconditional benefit strategy as a labour movement demand within the current British economic climate . For social dividends to work as a unifying theme for workers and for claimants, they must be high enough to secure an adequate standard of living without recourse to wages - preserving at least existing benefit levels is a pretty minimalist goal here . Yet if social dividends are significantly above subsistence level, they will lead to a massive increase in transfer costs, which will take the form of increased taxation on remaining wage levels, and at the same time they will effectively undermine the mechanism by which wages are fixed within a capitalist economy . This effect can only be countermanded by introducing statutory control over wage levels, removing entirely the capital/wage labour basis of the economy and replacing it with guaranteed state support for all and state control over remaining wage levels . In other words social dividends are not a pragmatic, progressive demand to move a demoralised labour movement forwards towards a new offensive on rampant capital ; they are a transitional or revolutionary demand for the immediate overthrow of the whole capitalist system . This contradiction is revealed most starkly in the ends and means advantages claimed for social dividends referred to at the beginning of this section . The achievement of a guaranteed income for all, it is argued, would permit the organised labour movement to rise out of the trough of defeat into which they have been forced by a rampant Thatcherism, by freeing the workers from the conscription of wage labour . Yet this guaranteed income must first be achieved through social reform before its revitalising effects on the struggle can begin to take place . The means in this strategy are thus conditional upon the ends . Like the utopianism of Gorz, therefore, it remains pipedream rather than politics .

In spite of the strategic flaws in the claims made for social dividends, however, the arguments which Gray and others use to justify the need for new policy prescriptions are powerful and accurate enough . The socio-economic strategy of Thatcherism is based upon reducing state dependency to a basic, means-tested minimum and coercing workers into accepting lower rates of pay through stringent availability for work tests and wage subsidies which trap them on poverty wages . And there can be no doubt that the labour movement needs to make some significant progress in developing comprehensive and comprehensible strategies for social and economic policy reform to counter the divisive consequences of this increasingly effective strategy . It is a strategy which will have created a new political climate in the 1990s in which there can be no going back to the hackneyed prescriptions of the post-war settlement, not the least reason for which is that, by

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then, these will largely be history . However, the need for rethinking political and economic priorities should not pressure us into abandoning the need for strategic judgement . Revolutionary demands will not serve the labour movement well in its attempt to resurrect popular support for progressive moves towards socialism . Thus social dividends should definitely be taken off the policy agenda . We must return from the 'quick fix' to the more careworn questions of developing and popularising strategic policy demands, which themselves will pave the way for more progressive developments as conditions change . Socialist policy change within capitalism must therefore accept the constraints of existing social and economic structures, and seek to weaken these, to prepare the way for further change, by strengthening the overall position of the working class, and demonstrating the moral values of collectivist social change . These are not new questions, they have been on the agenda of most progressive socialist and social democratic political parties for some time . They have recently been discussed at length, however, by some of the Scandinavian theorists of social democratic reform (Esping Anderson, 1985, and Korpi, 1983) ; and in Sweden, for example, they have been the backbone of major achievements in social and economic reform . In Britain, they remain the strength of the more successful elements of the post-war welfare state, such as the National Health Service ; and they can provide the basis for a revitalised appeal to challenge Thatcherism in the 1990s, if they are kept at the forefront of policy planning . Progressive policies for income maintenance must therefore be based within the existing labour market, though they should seek to weaken the power of capital here in order to pave the way for more radical reform . This means accepting that wages must remain the basic means for income distribution ; with benefits, as a substitute for wages for the unemployed or unemployable, as the central feature of any scheme for state support . This need not imply a return to the wage-based insurance benefits of the post-war Beveridge plan, however, with all the undesirable exclusions from and exceptions to state support which this entailed (see Alcock, 1987, Ch . 6) . And it should certainly not imply a continuation of means-testing as the major basis for benefit entitlement, as currently advocated by the Conservative Government, and as pursued, by default, by recent Labour administrations . If wages are to be the major means of providing subsistence, then we should ensure that they do just that . A statutory national minimum wage (sNMw) for all individuals must be a major demand for any progressive socialist government in Britain . It is a demand which has only recently been won after much hard work within the Labour Party and the TUC, and it is still under assault from the right

Unconditional benefits as well as the revolutionary left . The SNMW was a central feature of the Labour Party's 1983 election manifesto commitment to tackle low pay . It is also referred to at the end of the section on Pathways out of Poverty in the report of the Economic Equality Review Group, in the First Report of the Party's Policy Review Programme (Labour Party, 1988) . However, Labour's commitment to SNMW does remain rather vague at present indeed the First Report of the Review Programme said that further work on minimum wages was needed . The criticism of the right is that a SNMW would lead to an increase in labour costs, which employers would off-set by shedding workers, leading to increased unemployment . Former Secretary of State for Employment, Lord Young, claimed that a minimum wage of £80 p .w . in 1982 would have led to the loss of between 60,000 and 600,000 jobs (Hansard, 4 Nov . 1986, col 378) . A SNMW of £80 p .w. at 1982 wage levels is roughly equivalent to 50% of average earnings . This is below the 'decency threshold' adopted by the Committee of Experts of the Council of Europe, under Article 4 of the European Social Charter . The threshold is set at 68 of average full-time earnings, and at 1987 wage levels it would give a minimum wage in Britain of £135 p .w . This is close to the TUC target minimum of two-thirds of average male wages . The criticism of the left is that a minimum wage set at such a decency level would have such revolutionary consequences that a Labour Government would never seriously consider implementing it . Thus they argue, it is utopian to campaign for a sNMW ; and more radical propositions might as well be put forward . For many years now, however, the Low Pay Unit (LPu) have been advancing the case for a SNMW, and discussing seriously the economic and political implications of it (see Pond & Winyard, 1983 ; and Low Pay Unit, 1988) . That such hardened campaigners as the LPU should repeatedly come to the conclusion that an SNMW is a strategic priority in the struggle against low pay is a telling counterweight to Gray's claim that the Thatcherite onslaught on the wage levels of the working class requires a more revolutionary 'mobilising demand' . And, in their detailed discussion of the programme for implementation of an SNMW (LPU, 1988), the LPU dispel many of the criticisms levelled at the SNMW strategy by both the right and the left . In particular they argue that the employment consequences of a national minimum would be unlikely to be as catastrophic as Lord Young predicts . Using the Treasury model Neuberger concluded that the maximum amount of jobs lost as a result of an £80 p . w . SNMW in 1982 would be nearer to 70,000 over five years, and that this would add significantly less than one per cent to price increases (LPU, 1984) . The LPU estimate that an SNMW set a 50% of average wages

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would add about £1 .58 billion to the national wages bill (LPu, 1988, p . 23) . As they point out, however, all of this additional income would flow back into the economy through consumption expenditure . Even allowing for the effects of this in increased imports, the boost in demand would intially generate an extra 10,000 jobs . The job creation effects of an SNMW could be further maximised by a small (one or two per cent) reduction in VAT, the revenue cost of which could be off-set by a higher level of income tax on high incomes . Overall they calculate the effect of such a minimum wage would be more than self financing, indeed it would even lead to an increase in government revenues (PLU, 1988, p . 25) . Of course, an SNMW set at 50% of average wages is not a sufficiently high level in the long run . The aim should be to achieve something nearer to the European decency level . The LPU themselves propose a target of two-thirds of median earnings of full-time male workers, around £132 p .w . at 1987 wage levels (LPU, 1988, p . 38) . However, they recognise the need for a process of phasing in of such a higher level, starting with a level of 50%, which would be around £ 100 in 1987 . The idea of phasing in from such a level has also been supported by the Labour Party, Economic Equality Review Group, including the Shadow Chancellor, John Smith (Economic Equality Consultative Seminar, London, 22 Sept . 1988) . An immediate SNMW of £100 P .W. gives a readily achievable and popular target for political campaigning . And yet it would represent a major increase for many, especially women, workers . It is the significant impact of even a relatively low SNMW on women workers which has attracted the support of feminists within the labour movement and trade unionists with large (low paid) female memberships to the minimum wage strategy (see Phillips, 1987 ; and Bickerstaffe, 1987) . As the LPU point out also, an sNMW would be likely to benefit, in particular, black workers since on average their wage rates are lower (LPU, 1988, p . 11) . In this sense the SNMW is very much a unifying demand across class, gender and race ; and yet one rooted in the offer of realistic and readily realisable goals . There are, of course, a range of practical questions facing any realistic strategy for an SNMW . Should it apply to all workers? What about part-time employees? How will it be enforced? What will be its effect on trade union bargaining over wages? What will be its impact in particularly vulnerable industries? Clearly problems such as these must be addressed, and policies adapted to meet practical aconomir realities . Once again most of these issues have been examined by the LPU in their programme for an SNMW . The most important practical issue is the need for the SNMW to be fixed at an hourly as well as a weekly rate, in order to cover parttime workers - the LPU suggest basing this on a 38-hour week (LPU, 1988, p . 28) . Failure to do this would leave a major loophole for

Unconditional benefits employers to take on cheap, part-time labour . Enforcement mechanisms must also more generally be included in the legislative framework for minimum wages ; it would be naive to rely for compliance on employers' goodwill or general law-abiding nature . The LPU outline a threefold strategy for enforcement, with trade unions acting as the primary agents for ensuring compliance with minimum levels as part of the process of collective bargaining . This would be backed up by a minimum wages inspectorate with statutory powers, and by rights for individual workers to enforce minimum levels through Industrial Tribunals, as with other employment rights . The linking of these three strategies for enforcement should significantly strengthen the positions of trade unions and individual low paid employees (LPU, 1988, p . 40) . Lower rates of minimum wage for younger workers are already in existence in other European countries with national minimum wage policies . In the Netherlands, for example, there is a sliding scale of increasing fractions of the full sNMW for those aged between 15 and 23 . A lower rate of around 80% may be justifiable for younger workers in Britain too . The same logic may also be extended to trainees, though the LPU argue that this should not be extended to workplace training for adult workers (LPU, 1988, p . 34) . A SNMW policy would also sit sensibly alongside any broader strategy for strengthening employment rights to be introduced by a future Labour Government . It could be linked to improved protection against unfair dismissal, with dismissal for refusal of under-waged employment being deemed automatically unfair ; and to a strengthening of trade union rights to ensure that workers are able to organise to prevent changes in conditions of service being introduced to off-set improved wage levels in some industries . However, there may be some sectors of employment where vulnerability to competition from low waged overseas production would mean that even minimum wage levels would render industries uncompetitive . Clothing is frequently cited as such an industry . Here the question of direct state subsidies to support private capital's inability to pay minimum wages must be considered by government . Such a subsidy may be justified to safeguard jobs in particular industries . However, direct subsidies, which could be linked to investment plans and employment policies, would be a far more preferable form of state support for employment than the blanket subsidies provided by current means-tested support for low wages, or by proposals for social dividends for all workers . The legislative and policy changes needed to support an SNMW, therefore, take on a broader remit than the setting of the wage level itself. But all of these broader issues are ones which would have to be tackled in any event by a progressive government coming into power after thirteen or more years of Thatcherite reform . That the strategy C&C 37-I

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for an sNMW would give these changes direction and coherence is a powerful reason for ensuring that it remains at the heart of any commitment to social and economic policy development . If the SNMW can ensure that those in waged employment no longer need to rely on benefits to avoid poverty, then benefits would become justifiable only as a substitute for wages . A benefit strategy to accompany an SNMW, therefore, should seek to do just that . All individuals unable to provide for themselves on the labour market should be entitled to a state benefit, paid because of the lack of a fulltime wage, and without recourse to contribution checks or meanstests . This implies a break with the family basis for current benefit provision, and the treatment of men and women as independent and equal claimants in their own right . Disaggregation, as it is called, would achieve much of the improved equality between men and women claimed for social dividends by their supporters . It would also make clear that minimum wages would only be expected to support individuals, not families, making them more obviously a readily achievable goal . Esam et al. (1985) have discussed such a strategy for benefit reform, and it has also been outlined by this author (Alcock, 1985) . It would not be necessary, or desirable, to pay all universal benefits for the unemployed at the same rate, however. As at present a lower rate of Child Benefit for children (though a much higher rate than the current one) could be payable to carers to ensure a form of support for families, outside of the wage system . There is also a justification for higher rates of benefit for those with disabilities, reflecting the higher costs of everyday life ; and higher benefits for very elderly or infirm claimants for similar reasons . Esam et al. (1985) discuss such variabilities in positional benefits, as they call them, their proposals for benefit reform mentioned above . The most important demand for such benefits, however, is that they should be higher than current subsistence levels, in order to permit those out of paid employment to enjoy a participatory standard of living within society . This has always been the most consistent demand of the poverty lobby, and yet it is not included in most 'practical' proposals for social dividend schemes . And in order to secure that such levels were maintained in the future, they would need to be uprated in line with increases in the levels of average and minimum wages . This is a demand which could secure the support of the unemployed without jeopardising an appeal to the majority of those in secure employment . Costello (1986) makes much, in her criticism of Esam et al., of their suggestion that benefit levels be equivalent to minimum wages, with the result that paid employment would have to take on a coercive form, thus reproducing the worst labour discipline effects of previous benefit systems . This is neither a necessary nor a desirable

Unconditional benefits consequence of the joint planning of wage and benefit strategies . Whatever the long-term aims, the short-term expediency would need to ensure that minimum wage levels were set above equivalent benefit entitlement . Thus ensuring a genuinely positive incentive to enter the labour market . If benefits and wages were similarly related, pro rata, for part-time employment, then this would permit and encourage fairer treatment for the growing numbers of part-time employees within existing labour market mechanisms . Registration for availability for work could then become a bureaucratic requirement for the receipt of benefit, for those not engaged in caring work at home, with job Centres acting as the positive placement agencies that they were supposedly intended to be . Needless to say one of the significant attractions of a minimum wage/state benefit strategy for social security reform is that it would permit significant improvements in living standards for the worst-off members of our divided British society, without the introduction of astronomical transfer payments through taxation . It would be disingenuous, however, to suggest that additional costs would not be incurred in improving the lot of the less well-off, or that these could be met without a significant increase in taxation . The Conservative Government would easily ridicule claims that redistribution could be concealed within minor juggling between existing public expenditure budgets, for instance, by running down the costs of Defence . Any examination of expenditure patterns of existing government departments demonstrates the unrealistic tenure of such a claim . However, the Government's abolition of the higher rates of income tax in the 1988 Budget, may have provided the left with just the platform it needs to argue for the justice of increased taxation in order to finance more egalitarian policies of redistibution through wages and benefits . Indeed in taking such a step the Government have put the issue of taxation and redistribution firmly onto the political agenda . Basing one's policy priorities within the constraints of the world in which we live, therefore, does not always involve ceding ideological ground to the forces of reaction . Indeed it is only by taking on those forces where they do stand that we can envisage any hope of success . The demand for a statutory minimum wage, coupled with noncontributory, non-means-tested benefits for those outside of the labour market is a strategy for the joint reform of wages and benefits, which would permit achievable social reform to be made within the Britain of the 1990s . It is also a demand which could attract the support of the labour movement and of the electorate . However, it is struggling hard for a place on the agenda of policy development within the labour movement . It would be a tragedy indeed if this struggle were diverted into a discussion of the dubious and contradictory claims of social dividends for all .

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Adam Smith Institute (1984) Omega Project.' Social Security Policy . AS1 . Alcock P, (1985) 'Socialist Security : where should we be going and why?', Critical Social Policy, Issue 13, Summer 1985 . Alcock, P . (1987) Poverty and State Support . Longman . Ashby, P . (1984) Social Security after Beveridge : What Next? . NCVO . Bickerstaffe, R. (1987) 'The Bottom Line', New Socialist, February 1987 . Collard, D . (1980) 'Social Dividends and Negative Income Tax', in Sandford, C ., Pond, C . & Walker, R . (eds), Taxation and Social Policy . Heinemann E. B. Costello A, (1986) 'Who's to Benefit - Review Article' Critical Social Policy, Issue 17, Autumn 1986 . Deacon, A. & Bradshaw, J . (1983) Reserved for the Poor: the Means-test in British Social Policy . Martin Robertson & Basil Blackwell . Dilnot, A ., Kay, J . & Morris, C . (1984) The Reform of Social Security . Oxford UP . Esam, P ., Good, R . & Middleton, C . (1985) Who's to Benefit: a Radical Review of the Social Security System . Verso . Esping Anderson G . (1985) Politics against Markets: the Social Democratic Road to Power . University of Harvard Press . Federation of Claimants Unions (1984) A Guaranteed Minimum Income . Pcu . Gray, A . (1988) 'Resisting economic conscription' Capital&Class, Issue 34, Spring 1988 . Gorz, A . (1982) Farewell to the Working Class . Pluto Press . Green Party (1985) Information about the Basic Income Scheme . Green Party . Jordan, B . (1987) Rethinking Welfare . Blackwell . Jordan, B . (1988) 'The prospects for Basic Income' Social Policy and Administration, Vol . 22 No. 2, August 1988 . Keane, J . & Owens, J . (1986) After Full Employment . Hutchinson . Korpi, W . (1983) The Democratic Class Struggle . Routledge Kegan Paul . Labour Party (1988) Social Justice and Economic Efficiency, the First Report of the Labour Party's Policy Review for the 1990s . Labour Party . Low Pay Unit (1988) From the Dole Queue to the Sweatshop . LPU . Low Pay Unit, (1984) Britain can't afford low pay : a programme for a national minimum wage . LPU . Mann, K . (1986) 'The making of a claiming class : the neglect of agency in analysis of the welfare state' Critical Social Policy, Issue 15, Spring 1986 . Parker, H . (1984) Action on Welfare: Reform of Personal Income and Taxation . Social Affairs Unit . Phillips, A . (1987) 'Divided Loyalties' New Socialist, February 1987 . Pond, C . & Winyard, S . (1983) The Case for a National Minimum Wage . LPU Pamphlet No . 23 . Purdy, D . (1988) Social Power and the Labour Market . MacMillan . Rustin, M . (1987) 'The non-obsolescence of the right to work' Critical Social Policy, Issue 18, Winter 1986/7 . Vince, P . (1983) Tax Credit. Women's Liberal Federation .



Simon Clarke

The basic theory of capitalism : A critical review of Itoh and the Uno School Makoto Itoh The Basic Theory of Capitalism : The Forms and Substance of the Capitalist Economy, Macmillan, Basingstoke, 1988 . £12 .95 .

• Makoto Itoh's work is well-known to readers of Capital&Class through his long-standing involvement in the CSE . He has now brought together his contributions to the debates on the theory of value and the theory of crisis within a systematic exposition of Marxist theory which brings out clearly the roots of his perspective in the work of Uno . The Uno School is one of the major schools of postwar Japanese Marxism, which came to prominence in the 1960s . I The Uno approach is marked by a radical neo-Kantian separation of theory from politics, and a fierce opposition to logical-historical interpretations of Capital in favour of a sharp distinction between theoretical and historical analysis . Itoh's book is important in making the Uno approach more accessible to an English speaking readership by relating its perspective directly to the recent English language debates . Although Itoh revises and develops the Uno approach, particularly in his concern to give the theory a greater political and historical relevance, he retains the essential methodological and theoretical foundations of the Uno approach . While Itoh's contributions is of considerable interest in its own right, in this article I intend to focus on these foundations as the basis of a critique of Itoh's book . The methodological foundations of the Uno school lie in the radical separation of three levels of analysis . The first level defines the basic principles of political economy, the second level defines a stages theory of world capitalist development, the third level defines the

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empirical analysis of capitalism as it occurs historically . Itoh's book relates exclusively to the first level of analysis, in providing the basic theory of capitalism . This methodology should be distinguished from the ahistorical formalism of contemporary 'analytical Marxism', to the extent that the basic theory of capitalism is not developed a priori, but is abstracted from the historical tendencies of capitalist society as it actually exists . However, the Uno approach remains formalistic, since the basis of this abstraction, and the corresponding division of levels between the basic theory, the stages theory, and historical analysis, is essentially arbitrary . The demarcation and specification of the basic theory is determined by purely analytical criteria, which define which historical tendencies correspond to the inner logic of capitalism, and which correspond to contingent factors introduced at the level of the stages theory or at the level of historical analysis . The result is that the pure theory is insulated from contact with the real world by the stages theory, which provides the link between theory and history. However, the stages theory derives neither from the pure theory nor from historical abstraction, but essentially from the need to build a bridge between the two, so that the only escape from a scholastic formalism is provided by a stages theory which is at best undeveloped, and at worst arbitrary . While the attempt to escape from dogmatic reductionism is commendable, the result is that the theory provides no coherent purchase on the historical process of capitalist development, on the one hand, and no political guidance, on the other . The element of arbitrariness appears both in the theoretical and the political differences within the Uno School, most particularly in the different characterisations of the contemporary stage of capitalist development . For Uno, the pure theory is derived by abstracting the historical tendencies of the laisse faire capitalism of mid-nineteenth century Britain . From 1870 to 1914 these historical tendencies were obstructed by the rise of monopoly and state intervention which disrupted the smooth operation of the law of value, and the period since 1917 has been a phase of transition from capitalism . Baba has recently pushed this analysis to its most absurd limits in identifying the Japanese corporation as the pre-figurative form of the new socialist society (Lie, 1987a, 1987b) . Itoh, on the other hand, insists that the pure theory has to be derived by abstracting from the historical tendencies common to all three stages of capitalism (mercantilist, liberal and imperialist), which implies that the present stage, far from being transitional, is one in which the contradictions of capitalism, and the class struggle which they generate, are entering into their most antagonistic phase . While Itoh's approach is certainly theoretically and politically more coherent, it is no less arbitrary than that of Uno to the extent that he retains the radical separation of theory from

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history which is the basis of the Uno approach . The substantive originality of Uno's approach, and the basis of Itoh's interpretation of Marx, is his formulation of Marx's theory of value . At the heart of Itoh's book lies his development of Uno's value theory, and its application to the problems of skilled labour, joint production, the transformation problem, the forms of surplus value and the theory of crisis . Most of this discussion has appeared in previously published works, but its appearance in book form enables us to assess Itoh's contribution as a whole . In this review I will concentrate on an assessment of Itoh's discussion of the theory of value and the theory of crisis . My general argument is that although Itoh offers many stimulating and provocative ideas, his analysis suffers from the formalism and arbitrariness which is inherent in the Uno approach .

Itoh poses the problem of value by offering Uno's theory as a way of resolving the dilemma presented by the confrontation of Ricardianism with the 'Rubin School' . The Ricardians focus on embodied labour as the substance of value, to the neglect of the central question of the form of value, so obliterating the fundamental distinction between labour-time and value . The Rubin School, on the other hand, brings the form of value to the centre of the stage, but at the risk of losing sight of labour as the substance of value . For the Rubin School the substance of value is not embodied labour but abstract labour . However, the amount of abstract labour embodied in a commodity cannot be defined independently of the exchange of commodities through which private labours are reduced to their common social substance . The only measure of abstract labour is correspondingly a monetary evaluation of the products of labour, expressed in their prices . The danger of such an interpretation is that reference to labour as the substance of value is reduced to an empty rhetorical gesture in a theory which never manages to penetate the appearances of exchange relations because it obliterates the distinction between value and exchange value . 2 For Itoh, the Uno approach resolves this dilemma by radically separating the theories of the form of value and the substance of value . The pure theory of the forms of value does not make any reference to the substance of value, but only to the quantitative exchangeability of commodities in determinate ratios, which ratios are determined by the social process of reproduction of commodities lying behind their regular exchange against money . Thus the theory of value is derived from the theory of reproduction . This theory can be applied not only to capitalism, but to all societies in which the systematic exchange of commodities takes place according to the need to reconcile such exchange with economic reproduction . Moreover the theory enables

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us to develop the pure concept of capital, as self-expanding value, prior to, and independently of, the theory of capitalist production . This allows it to illuminate the limits of the antediluvian forms of merchants' and usurers' capital, and so to establish the necessity of capitalist production as the adequate form of capital . The substance of value, abstract labour, is equally not confined to the capitalist mode of production . Abstract labour, as the homogeneous expenditure of the human ability to work, measured by time, is a feature of the labour process as a technical process, independently of the social form of production . The amount of labour socially necessary to produce a given product is determined by the technical characteristics of the labour process at a particular stage of its development . The need to allocate the labour-time at the disposal of society is common to all modes of production, regardless of the means by which such an allocation is achieved . Moreover this allocation must, in every form of society, at least establish the conditions for simple reproduction by ensuring that the necessary means of production and subsistence are reproduced . However, no such constraint restricts the allocation of surplus labour, and it is this which, for Itch, underlies the possibility of various forms of class society by enabling ruling classes to appropriate the product of surplus labour and divert it to their own ends . The capitalist mode of production is not distinguished by the existence of surplus labour, or of abstract labour or the value form, but by the integration of the value form with abstract labour as the substance of value, and of the labour process with the valorisation of capital, as the appropriation and distribution of surplus labour is achieved through the exchange of commodities . The law of value describes the allocation of abstract labour, in accordance with the needs of reproduction, through the form of value . The separation of the form and substance of value is essential for Itoh because it underlies the relative autonomy of the form of value, which in turn explains how the law of value can regulate the allocation of abstract labour without requiring commodities to exchange in proportion to the amount of labour-time embodies in them . The key to this autonomy, for Itoh, is the distinction noted above between the allocation of necessary labour, which is subject to the minimal requirement of ensuring the reproduction of the necessary means of production and subsistence, and the allocation of surplus labour, which is subject to no such constraint . Thus it is entirely consistent with the social reproduction of the capitalist mode of production that commodities do not exchange in ratios corresponding to the abstract labour embodied in them as surplus labour is redistributed amongst various branches of production through the value form, and indeed the tendency to the equalisation of the rate of profit dictates that exchange should be unequal in this respect . Thus

Basic theory of capitalism prices of production are not a 'transformation' of values, but are the developed form of value corresponding to capitalist competition . The conclusion is that 'standard prices, as the form of value, are generally regulated by the labour-substance of value, with such slack in the range of unequal exchange of surplus-labour for the commodity products' (p . 136), an argument which is developed through an extensive reinterpretation of the reproduction schemes and reevaluation of the 'transformation' problem . On the basis of this analysis of the law of value Itoh explores the problems of skilled labour and joint production . On both theoretical and political grounds he argues that 'skill' is merely one aspect of the differentiated forms of concrete labour, so that from the point of view of abstract labour there is no difference between labours of supposedly different skills, all of which are equally the expenditure of labourpower . The problem of skilled labour therefore relates to the theory of wages, and not to the theory of value .3 He goes on to argue that the problem of joint products can be resolved within the Uno theory . The allocation of abstract labour between joint products cannot be determined technologically, which implies that it can only be determined through the market mechanism of the value form . 4

Itoh's reformulation of the Marxist theory of value certainly addresses the central problem, that of the relation between the form and the substance of value . However, the question we have to ask is whether Itoh has succeeded in overcoming the complementary problems which he identifies as those of the Ricardian and Rubin approaches, to provide an integrated theory of value, which can take full account of the determinations imposed through the form of value without losing sight of abstract labour as its substance . My own view is that he has not overcome this problem, and I think that this is because of what he regards as the great strength of the Uno approach, the radical separation of the substance from the form of value, a separation which he shares with the Ricardians and the Rubin School, although he pushes it to its limits . If such a separation is posited in the first place, it is difficult to see how the two can be reintegrated . While the Ricardians may be accused of losing sight of the form of value, and the Rubin school of its substance, Itoh manages to retain both only by holding to a dualistic theory, in which the form of value is detached from its substance .5 For Itoh, the substance of value, abstract labour, is defined as the labour-time socially necessary for the production of a commodity . This is determined by the technical features of the production process under average conditions . While it is certainly possible to define such a magnitude, the crucial question is that of its social significance . In what sense can it be said that this magnitude is 'the substantive basis

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of regulating the values of commodities with social necessity'? Itoh does not regard the theory of the substance of value as being necessary to determine market prices (p . 130) . His theory of market prices is based on a quasi-Marshallian theory of market value, which 'appears as the gravitational centre of market prices' . . . 'reflecting the dominant conditions of production to meet fluctuating demand' (pp . 232-3) . Market value cannot be determined by abstract labour, because the latter has no social mode of existence : 'Since there is no direct social means of defining representative conditions of production in various spheres of a commodity economy, the market value corresponding to the representative conditions of production must be sought through the anarchical fluctuations of market price' (p . 232) . Thus Itoh's position in the end seems to come back to that of the Rubin School which he dismisses . The role of abstract labour in the regulation of value is not related to the formation of prices, but to the needs of reproduction . As noted above, if the exchange of commodities as values is to secure the reproduction of the system of production it must secure an allocation of abstract labour such as to ensure that each branch of production is able to renew the necessary means of production and subsistence . In this sense the concept of abstract labour defines the limits within which market values and market prices can fluctuate without compromising social reproduction . However, even in this restricted sense the concept of abstract labour is by no means necessary to define the conditions of reproduction, which can be more economically specified in price terms, nor does the concept of abstract labour define any social mechanism by which the appropriate allocation of labour-time, and so social reproduction, is assured . In the end it seems that the only role of the concept of abstract labour is the traditionally minimalist one that it establishes the historical specificity of capitalist society by showing that the capitalist mode of production is only one form in which 'the general economic rules common to different social formations' operate (p . 130) . The theory of the substance of value is thus a purely formal theory, without any explanatory power . This formalism runs throughout Itoh's account of the substance of value, and permeates his analysis of socialism, both in the body of the book and in a special addendum . Since the theory has no substantive significance, the definition of the substance of value is arbitrary . For Itoh it is political criteria which ultimately provide the guide, his insistence on the essential homogeneity of all forms of labour being motivated by a profound and commendable egalitarianism, and his insistence on hanging onto abstract labour as the substance of value being motivated by his desire to provide an objective foundation for such an egalitarianism . His theory of skilled labour, and its application to the question of socialist planning, has

Basic theory of capitalism challenging implications, and is perhaps the most important feature of his book . But the formalism of his approach prevents him both from setting the theory on a firm foundation and from rigorously developing its implications . It is certainly true that exchange is not peculiar to capitalist society . However, it is only in a capitalist society that the exchange relation is reduced to a quantitative relation between things, and so takes on the value form, as commodities are uniformly reduced to the products of human labour in the abstract . It is certainly true that every mode of social production has to provide some means of regulating the expenditure of human labour-power and the distribution of its products . However, it is only in a capitalist society that this regulation is achieved on the basis of the reduction of all concrete human labour to homogeneous abstract labour, a reduction which is only achieved through the alienated form of the exchange of commodities as values . The very notion of labour-time, as a distinct and quantifiable portion of the day, depends on the emergence of wage labour, and so on the distinction between free time, one's own time, and labour-time, time at the disposal of another . Moreover the reduction of contrete labour to homoegeneous abstract labour can only be achieved through the alienated form of the exchange of commodities as values, for value is the only mode of existence of abstract labour . Although the theory of value is at the heart of Marx's critique of capitalism, the value debates of the last few years have become evermore esoteric . Yet Marx's theory of value is surely very simple, however complex may be its full analytical development . It rests on the observation that labour is the active principle of all production, and that the expenditure and allocation of labour-power in commodity producing societies is regulated through the exchange of commodities . In a hypothetical society of petty commodity producers commodities would be exchanged as the products of labour, through which the labour-time socially necessary to produce a commodity would appear as an objective constraint on the life activity of the individual unit of production in the form of the price, competition tending to force each producer to meet the norms of productivity in order to achieve the normatively established standard of living . In the capitalist mode of production labour remains the active principle of production . With a given technology how much is produced depends on the skill and ingenuity of the labourer, the intensity of labour and the length of the working day . However, commodities are no longer exchanged as the products of labour, but as the products of capital, and the principle of equilibration is no longer that of the equalisation of prices to exchange values corresponding to socially necessary labour-time, but that of the equalisation of the rate of profit . The equalisation of the rate of profit

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redistributes surplus value among capitalists, and correspondingly modifies the allocation of social labour value among branches of production . However, the expenditure of labour power is no less subject to the constraint of the labour-time socially necessary to produce the commodity, the only difference being that this constraint now appears in the transformed form of prices of production . In the face of competitive pressure the capitalist can only increase the mass of surplus value appropriated in the form of profit by intensifying labour, increasing the length of the working day, and revolutionising the forces of production. It should be clear by now that if we regard the expenditure of labour-power as being determined by the technology, so that the theory of value concerns only the allocation and not the expenditure of social labour, and if we abstract from the dynamics of the capitalist mode of production, to focus only on the equilibrium conditions, the labour theory of value is redundant, and the formal models of bourgeois economics provide a more elegant and economical way of determining the set of equilibrium prices . However, this is to abstract from the social processes which determine the development of the capitalist mode of production, and it is these social processes which were the object of Capital, and which the labour theory of value alone can illuminate, to develop an analysis of the laws of motion of the capitalist mode of production . Moreover these laws of motion do not define a tendency to equilibrium, but rather define a tendency to overaccumulation and crisis .

The theory of crisis

The weaknesses of Itoh's formulation of the theory of value reappear in his formulation of the theory of crisis, which again draws heavily on Uno . There is no difficulty in defining the formal possibility of crisis, which is always going to be inherent in a system of commodity production . However, a theory of value which emphasises the equilibrating role of commodity exchange in securing social reproduction by regulating the allocation of social labour is clearly going to have some difficulty in establishing the necessity of crisis . Far from representing a development of the theory of value, the theory of crisis in such a context can only be a theory of the breakdown in the operation of the law of value . Thus Itoh requires only that the theory of crisis 'should be consistent with the working of the law of value', insisting that 'crisis theory must clarify how the working of the law of value becomes distorted, destroyed and restored in the course of business cycles' (pp . 292, 293) . On these grounds he rejects underconsumption and disproportionality theories because they presuppose the breakdown in the law of value, without explaining such a breakdown . He equally rejects falling rate of profit theories, on the grounds of the counteracting tendencies, of the possibility of

Basic theory of capitalism accumulation through capital widening, and of the absence of a necessary link between a fall in the rate of profit and the outbreak of a crisis . For Itoh, the key to the theory of crisis is the one commodity whose reproduction is not subject to the law of value, namely labour power . While the law of value provides the means by which an increased supply of any other commodity can be called forth, in response to a temporary increase in its price, the supply of labour power is not regulated by the law of value in this way . Thus the theory of overaccumulation with respect to labour-power provides the only theory of crisis which is fully consistent with the law of value by providing an explanation for the breakdown of that law . Itoh recognises that Marx explicitly excluded labour shortages as the source of crises . 6 On the one hand, the accumulation of capital is associated with the creation of a relative surplus population which constantly augments the reserve army of labour . On the other hand, in the event of a rise in wages capitalists will respond by substituting dead for living labour . Moreover, as John Weeks noted in his critique of Itoh's crisis theory (Weeks, 1979), there is no reason why an increase in wages should provoke a crisis, rather than merely a decline in the rate of accumulation, which is, in fact, precisely the reaction Marx depicts (Capital, vol 1, p . 770, quotes Itoh, 1988, p . 303) . Itoh recognises the special assumptions required to establish the necessity of a crisis associated with a shortage of labour-power . The necessity of overaccumulation with respect to the supply of labour power is established by the assumption that in the phase of prosperity competition is limited, and so accumulation takes on an extensive form, with little change in the composition of capital, so that employment rises pari passu with investment until the reserve army is exhausted . It is only in the depression that intensified competition leads to the transformation of methods of production and the augmentation of the reserve army of labour to prepare the way for renewed accumulation . However, this argument certainly cannot support a theory of the necessity of crisis, since it is a purely contingent hypothesis . Moreover it is a hypothesis which is both counter-intuitive and empirically suspect, if not demonstrably false . The demonstration of the tendency for accumulation to run ahead of the reserve army, however tendentious it might be, is still not sufficient to establish the necessity of crisis, rather than a smooth decline in the rate of accumulation, based on a smooth fall in the rate of profit . Itoh fills this gap with an analysis of the impact of a rise in wages on the operation of the law of value . The rise in wages reduces the pace of accummulation and so retards the operation of the law of value by making it more difficult to correct imbalances in supply by the movements of capital . Moreover the rise in wages, which is not counteracted by an increase in the supply of labour power, increases

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such imbalances by its differential impact on prices . The fluctuations and distortions of prices in turn give rise to growing speculation, much of which is financed by the expansion of credit . However, this growing demand for speculative credit comes up against the barrier of a contraction in supply in the face of the decline in profitability, so that interest rates rise . Eventually the fall in the rate of profit and the rise in interest rates lead to a crisis, in which the massive contraction of credit precipitates a cumulative spiral of decline .

The law of value and the necessity ofcrisis

There can be little doubt that Itch's theory of overaccumulation with respect to labour power, and his outline of the mechanism of crisis, depicts a possible form of overaccumulation crisis, although its historical relevance might be doubted in a world which has seen a secular expansion in the size of the reserve army on a global scale since the very beginnings of capitalism . However, the theory claims much more than this, for it purports to provide a theory of the necessity of crisis, and indeed to provide the only possible such theory, within the basic theory of capitalism . This claim is based not on the historical tendencies of capitalism as it actually exists, but on the inner logic of the theory . As such the theory of crisis, like the theory of value on which it rests, it essentially arbitrary . The difficulty of establishing the necessity of crisis for Itoh derives from his interpretation of the law of value as the law of equilibrium, ensuring an appropriate allocation of social labour, which immediately implies that crisis will be avoided so long as the law of value operates normally . To establish the necessity of crisis he accordingly has to explain the breakdown in the operation of the law of value . This explains the special role of labour power in his theory of overaccumulation, for the supply of labour power does not respond to changes in demand, so that the emergence of the commodity form of labour power constitutes a barrier to the smooth operation of the law of value . In my view this interpretation is the antithesis of Marx's theory of value, which is not a theory of equilibration, but of the contradictory and crisis-ridden character of capital accumulation . At the heart of Marx's theory is the contradiction between value and use-value, whose developed form is the contradiction between the capitalist tendency to develop the forces of production without limit, and the need to confine accumulation within the limits of the social relations of capitalist production . The Uno school emphasises this contradiction, but separates the value and use-value aspects . The theory of value is a part of the pure theory of capitalism, while usevalue considerations only appear at the levels of the stages theory and historical analysis . In its operation the law of value confronts barriers which derive from the use-value aspects of commodities, which prevent their reproduction from being smoothly regulated by the law

Basic theory of capitalism of value . However, labour-power is the only commodity whose reproduction is impervious to the law of value at the level of pure theory, and so can provide the only focus for contradiction in the pure theory of capitalism . The stages theory introduces more general usevalue considerations, under the guise of historical contingency rather than theoretical necessity, the reproduction of fixed capital, for example, presenting problems in the phase of imperialism . 8 For Uno's theory of value, as for bourgeois theories of supply and demand, disproportionalities are liquidated by the movement of capitals between branches of production in response to fluctuations in prices and profitability . However, this vision of a self-equilibrating system is developed in abstraction from the social form of capitalist production, in which capitalists do not simply appropriate profit by adjusting supply in response to the fluctuations of demand, but by extracting and appropriating surplus labour . In the face of competitive pressure the less successful capitalist does not simply give up the struggle and call in the receiver, but seeks to restore profitability by extending the working day, intensifying labour or revolutionising the forces of production . The more successful capitalist does not confine his production within the limits of the market, but seeks to capitalise on his advantage by expanding capacity, intensifying labour and extending the working day . Thus the law of value, imposed on capitalists through the pressure of competition, underlies the tendency for capital constantly to expand the forces of production without regard to the limits of the market . Accumulation does not take the form of the smooth adjustment of supply and demand in response to the movement of prices, but takes the form of a permanent tendency to overaccumulation and crisis, and is achieved only through a permanent class struggle . When accumulation confronts the barriers of the market the liquidation of surplus capital is not achieved by the smooth transfer of capital to new branches of production but by the devaluation of capital, the destruction of productive capacity, and the 'redundancy' of labour . The tendency to overaccumulation and crisis is common to all branches of production and to all phases of the business cycle . It is not simply a matter of the ignorance and uncertainty that undermines the smooth operation of the market, but of the social form of capitalist production as production for profit, through which competition compels capitals to develop the forces of production without regard to the limits of the market . It is, correspondingly, not a matter of the breakdown of the law of value, but its necessary mode of operation . The tendency to overaccumulation in a particular branch of production will be reinforced to the extent that opportunities for surplus profit persist, as the result of a rapidly growing market, continued technical advance, and the time taken for the expanded capacity to result in an increased product, and to the extent that less

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successful capitalists are able to survive by intensifying labour, extending the working day, or securing credit . Thus the tendency to overaccumulation appears in the form of the uneven development of the various branches of production, the resulting disproportionalities being the consequence not of the breakdown of the law of value, but of the development of its contradictory foundation in the production of commodities as values . Itoh recognises the role of growing disproportionalities in the crisis, but for Itoh such disproportionalities are a symptom of the breakdown of the law of value provoked by overaccumulation with respect to labour power, rather than of its normal operation . Itoh provides a clear and concise account of the way in which disproportionalities can be absorbed by the expansion of credit, and of the way in which the expansion of credit sustains and encourages the overaccumulation and uneven development of capital, which must eventually culminate in a crisis, which will be the more severe the greater the extent of overaccumulation that it has sustained . However, Itoh confines this analysis to the phase of crisis, without realising that credit plays this role throughout the cycle, because he presumes that in the phase of expansion disproportionalities will not emerge because of the smooth operation of the market . In order to establish the necessity of crisis at the level of the basic theory we have already seen that Itoh has to follow Uno in making arbitrary, and counter-intuitive, assumptions about the form of accumulation so as to establish the progressive exhaustion of the reserve army of labour . However, the necessity of crisis also rests on abstraction from the state, and particularly from the ability of the state to regulate the system of money and credit . The shortage of labour and consequent wage increases only precipitate a crisis, in Itoh's theory, because accumulation is sustained, despite the fall in the rate of profit, by the speculative, and increasingly inflationary, overexpansion of credit, which undermines the law of value . It has been well established, at least since the Bullionist controversy at the beginning of the nineteenth century, that left to their own devices bankers will tend to fuel overaccumulation by overexpanding credit . Since the 1844 Bank Act the need to restrain the growth of credit in order to forestall such an eventuality has been the official basis of the monetary and financial policies of the state, and rising money wages have been seen as a primary indicator that domestic credit expansion needs to be curbed . It would seem that, within Itoh's theory of accumulation, all that is required to stave off crisis, and to regulate the cyclical form of accumulation, is for the state to pursue appropriate fiscal and monetary policies, which will restrict the rate of accumulation to the rate of growth in the supply of labour power . Itoh justifies his abstraction from the state on the grounds that the state has no place in the pure theory of the capitalist

Basic theory of capitalism economy . While such an argument is questionable in general, it is particularly inappropriate when considering the system of money and credit, which has increasingly come to rest on the foundation of state money . Be that as it may, the argument for the necessity of crisis offered by Uno and Itoh is peculiarly scholastic, for the necessity in question is exclusively theoretical, and rests on arbitrary premises . Not only does this not imply the historical necessity of crisis, the introduction of historical considerations makes it clear that the state can, through monetary regulation, overcome the tendency to overaccumulation and crisis and so sustain accumulation indefinitely . 10

Itoh's theory is formulated at a high level of abstraction, that of the pure theory of capitalism, and is not intended to be applied directly to the historical development of the capitalist mode of production . For the Uno school the stages theory provides the mediating link between pure theory and historical analysis . On the other hand, Itoh seeks to avoid the charge of formalism by insisting that the pure theory of capitalism is based primarily on the historical tendencies to be observed in the development of the purest form of capitalism, which was essentially that of the middle of the nineteenth century . Thus the implication is that the theory offers an analysis of the historical tendencies of mid-nineteenth century capitalism, but has to be further developed, primarily to take account of the countertendencies which have been mobilised since the 1870s, which complicate the picture with more or less contingent political and historical considerations . Itoh appears to see overaccumulation with respect to labour power as the typical form of crisis in the middle of the nineteenth century, although he does not identify a single crisis in which such overaccumulation played a significant part . " The concentration and centralisation of capital since the late nineteenth century has weakened the operation of the law of value, and so introduced complicating factors which modify the forms of crisis . For Uno these complicating factors are to be specified by the stages theory . Itoh departs from Uno at this point, and believes that they are amenable to analysis at the level of pure theory, focused on the growth of fixed capital . The rise of heavy industry in the late nineteenth century stimulated the enormous concentration and centralisation of capitals . The scale and gestation period of investment in fixed capital gave accumulation a markedly speculative character, leading to growing disproportionalities between the various branches of production, marked particularly by over-investment, with investment-led booms turning to crisis and depression as increased productive capacity confronted the barrier of the limited market . The growth of credit C&C 37-J

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and financial institutions, the emergence of monopolies, and the rise of the interventionist state further complicate the pattern of overaccumulation and crisis, so that the business cycle becomes irregular and its course uneven, with acute crises often being staved off at the expense of the persistence of surplus capacity, which severely depresses the rate of profit . The introduction of fixed capital transforms Itoh's crisis theory from a labour-shortage to a disproportionality theory . While overaccumulation with respect to labour-power is always a possibility, the typical form of the modern business cycle is determined by the tendencies to the overaccumulation and uneven development of capital which are associated with the growing importance of fixed capital . However, it is not fixed capital as such which determines this theoretical shift, but rather the introduction of use-value considerations in recognising that the accumulation of capital can only be sustained if capital is embodied in the forms of productive and commodity capital, which limits the free mobility of capital between branches of production in the face of fluctuations in the rate of profit, and so the equilibrating tendencies of the law of value . The growing importance of fixed capital, particularly associated with the expansion of the railways from the mid-nineteenth century, certainly gave the tendency to overaccumulation and crisis a particular historical character . However, the tendency was no less marked in the first half of the nineteenth century, when poor communications meant that a substantial portion of capital was tied up in the form of commodity capital, and the long gestation period of agricultural investment in particular was a prime source of the uneven development of the principal branches of production . Thus the tendency to overaccumulation and uneven development is not the result of the growing importance of fixed capital in the imperialist stage, but of the underlying contradiction between the production of commodities as values and their production as use-value . It is only the exclusion of use-values considerations from the pure theory that leads Itoh, following Uno, to see this tendency as the result not of the internal contradictions of the law of value, but of a particular historical phase of capitalist development . On the other hand, Itoh's break with Uno, marked by his development of a theory of fixed capital, introduces use-value considerations into the framework of the basic theory, which undermines Uno's entire methodological edifice and shows the way forward to a more adequate theory of value and crisis .

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Conclusion

In this article I have been concerned to criticise the theoretical and methodological foundations of Itoh's Basic Theory of Capitalism in the Uno approach . In conclusion, however, I would like to stress the positive contributions of Itoh's book, which point beyond the arid



Basic theory of capitalism 147

scholasticism of the Uno School . In his concern to give his analysis historical and political relevance Itoh repeatedly breaks through the formalism of the Uno approach, whether in his analysis of the antediluvian forms of capital, the problem of skilled labour, the functional forms of capital, or the theory of crisis, to provide stimulating and provocative arguments, which make the book essential reading for all those concerned with the development of Marxist theory .

1. Kozo Uno's Principles of Political Economy has been published in English . Robert Albritton (1984, 1986) provides a synthetic reconstruction of the Uno approach, based on the limited literature available in English, and particularly the work of Thomas Sekine, in which the Uno apporach is set on rigorously Hegelian foundations. 2. Itoh's characterisation of the 'Rubin School' might be disputed : Rubin's own position seems to me to be very close to that of Itch . The real sinners seem to be Sue Himmelweit and Simon Mohun (1978) . 3. Itoh does not explore the other dimension of this problem, which is that of the intensity of labour . Although he argues that there is no necessary relationship between the skill and intensity of labour, and notes that it is impossible to provide any objective measure of intensity, this does not make the problem go away . The crunch question is simple : does an increase in production due to an intensification of labour, or to an increased level of'skill', increase the mass of value produced, or does it immediately devalue the product in accordance with the reduction in the labour-time socially necessary to produce it? This question can only be addressed within a theory of value as a theory of the dynamics of capitalism, which Itch does not provide . 4. Itoh sees this concession to the Rubin School in allowing values to be determined in the market, within the limits of the total labour-time embodied in the joint products, as being of limited significance . However, the centrality of the problem of the Sraffian critics of Marx derives from their treatment of existing fixed capital as a joint product, and it is fixed capital which really creates the problems for embodied labour theories of value, whether of the Ricardian or Uno varieties . Itoh rejects the joint-product approach to fixed capital, but he doesn't develop his own analysis of fixed capital, which is very unfortunate given the central role he ascribes to fixed capital in his theory of crisis . 5. This same problem can be posed as that of the relation between production and circulation . Cf. Simon Clarke (1980), and especially Diane Elson 'The Value Theory of Labour', in Elson (1979) . 6. Against this he notes the association which Marx emphasised between the course of wages and the course of the business cycle . However, there is no evidence that Marx saw fluctuations in the reserve army' as a basis of

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a decennial business cycle' (p . 297), rather he saw fluctuations in wages as mirroring the fluctuations of the cycle . In Chapter 15 of Volume 3 of Capital he does relate the outbreak of crisis to the exhaustion of the reserve army, but the latter is only an additional factor which compounds a hypothetical overaccumulation crisis in which capitalism has reached its ultimate limits, where 'the expanded capital produces only the same mass of surplus value as before' (p . 360) . This argument sits uneasily alongside the claim that the law of value 7. operates smoothly in the phase of prosperity, which would imply the smooth liquidation of backward capitals, and so the absence of barriers to technological innovation. Itoh also excludes those portions of the reserve army recruited from the destruction of petty production or from the household, on the grounds that such consideration is not relevant to the pure theory of capitalism . This leads directly to Uno's social democratic diagnosis of contemporary 8. capitalism . The development of monopoly and state intervention, culminating in the transition to socialism, is dictated by the increasing inability of capitalism to subordinate the reproduction of use-values to the law of value . Itoh does not explicitly develop this aspect of Uno's theory, but nor does he provide an alternative formulation of the contradiction . The only crisis which Itoh explicitly attributes to overaccumulation 9. with respect to labour power is that of the late 1960s . Although such an interpretation is widespread (see especially Armstrong, Glyn and Harrison, 1984), it is difficult to justify empirically . Although profits fell while real wages continued to rise, there is no evidence that the profit squeeze was the result of rising real wages . The fact that the crisis was a global crisis, despite very different labour supply conditions in different countries, the fact that the crisis led to an enormous augmentation of the reserve army, and the fact that participation rates continued to grow rapidly after the onset of crisis, cast considerable doubt on the hypothesis . However, even if the profit squeeze had been caused by an acceleration in the rate of growth of real wages as accumulation ran ahead of the supply of labour power, the proximate cause of the crisis, according to Itoh's analysis, would lie in the excessively expansionary policies which had permitted such overaccumulation . Far from being necessary, the crisis would merely have been the result of fiscal and monetary mismanagement . The cost, for the Uno school, of such restrictive credit policies would 10 . be to remove the technological innovation which supposedly only occurs in the face of intensified competition in the wake of a crisis . Of course every crisis is also determined by contingent historical 11 . factors . However, a theory of the necessity of crisis is of purely scholastic interest if it cannot play a part in explaining the historical development of capitalism . Although money wages rose in the boom, along with all prices, the tendency in the nineteenth century was, if anything, for real wages to move contra-cyclically, a feature which plays a central part in Aglietta's theory of the regime of extensive accumulation (Aglietta, 1981) . As Itoh recognises (Itoh, 1980, p . 140), the nineteenth century business cycle was marked by the uneven development of the leading branches of production, and was dominated by the movements of commodity prices, not by the course of real wages . I have tried to develop a more adequate historical and theoretical account of the tendency to overaccumulation and crisis in Clarke (1988) .

Basic theory of capitalism

Albritton, Robert (1984) 'The dialectic of capital : a Japanaese contribution', Capital & Class, 22, 1984, pp . 157-176 . Albritton, Robert (1986) AJapanese Contribution to Marxist Theory, Macmillan, Basingstoke . Aglietta, Michel (1981) A Theory of Capitalist Regulation, New Left Books, London . Armstrong, Phil, Glyn, Andrew & Harrison, John (1984) Capitalism Since World War 11, Fontana, London . Clarke, Simon (1980) 'The Value of Value' Capital & Class 10, 1980 . Clarke, Simon (1988) Keynesianism, Monetarism and the Crisis of the State, Edward Elgar, Aldershot . Elson, Diane (ed .), Value, CSE Books, 1979 . Himmelweit, Sue & Mohun, Simon (1978) 'The Anomalies of Capital', Capital & Class, 7, 1978 . Itoh, Makoto (1980) Value and Crisis, Pluto, London and Monthly Review, New York . Itch, Makoto (1988) The Basic Theory of Capitalism, Macmillan, Basingstoke . Lie, John (1987a) 'Review of Albritton (1986)', Review of Radical Political Economy, 19, 2, 1987, pp . 91-93 . Lie, John (1987b) 'Reactionary Marxism', Monthly Review, 38, xi, 1987, pp . 45-51 . Sekine, Thomas (1975) 'Uni-Riron : A Japanese contribution to Marxian political economy', Journal of Economic Literature, xii, 1975 . Sekine, Thomas (1980) 'The necessity of the law of value', Science and Society, Fall 1980 . Sekine, Thomas (1981) 'The circular motion of capital', Science and Society, Fall 1981 . Sekine, Thomas (1982) 'The law of market value', Science' and Society, Winter 1982-1983 . Uno, Kozo (1980) Principles of Political Economy, Harvester, Brighton . Weeks, John (1979) 'The process of accumulation and the "profit squeeze" hypothesis', Science and Society, xlii-3, Fall, 1979 .

References

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ISSUE No. 77

FALL 1988

Piccone: Reinterpreting 1968 : Mythology on the Make Bauman : Paradoxes of Jewish Assimilation Kentor: Popular Music and Adomo's "The Aging of the New Music" T W. Adorno : The Aging of the New Music Berman and Piccone : Hidden Agendas : Heidegger and,the Post-Modem Debate Luke : The Political Economy of Colonization : Reel Rehab? D'Agostino : Machajsky and the New Class : A Reply to Haberkern Schlesier: Levi-Strauss' Mythology of the Myth Jacoby: New York Intellectuals Bokina: Music, Postmodernism and Critical Theory Appel: The Rationality of Traditions Good: The Posthumous Sartre Ezra : The Forces of Reproduction Quart: Viva Kazan!

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John Maclnnes Thatcherism at Work Open University Press, 1987 . Pb £6 .95 SSBN : 0-335-15516-2 . Reviewed by Anne Pollert This is a stimulating and well written book - a timely challenge to the assumption that Thatcherist rule has produced the radically new era so often claimed for it, and a sane resurrection of historical perspective . In the deluge of writings claiming new industrial relations, and new forms of work, it is brave indeed to point out continuities rather than change . MacInnes's central thesis is that Thatcherism, far from being a novel political offensive, is simply a throwback to the Victorian heritage of laissez-faire which, it is argued, was responsible for Britain's economic decline relative to the success of the more 'dirigiste' regimes of its competitors . Today's free-market policies do no more than reestablish the old ruts of management pursuing short-term ends and its 'right to manage', unions following sectional vested interests, and the State abdicating responsibility for planning and intervention . All this spells more of the downward slide of the British economy . In contrast to this seedy picture shines the

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152 Post-War Settlement, built on the principles of the Welfare State and full employment, as a valiant but thwarted attempt to break out of the laissez-faire mould . Politically, Maclnnes is a stalwart defender of social democracy and corporatism, the 1974-79 Social Contract nostalgically evoked as its highpoint . While he rightly gives due credit to legal reforms which gave workers and unions a basic floor of rights, the eulogy on Labourism's survival against mighty economic and political odds seems a bit over the top, while the recall of that same administration presiding over unemployment reaching over 1 million, its cuts in the social wage', and intolerable public sector pay restraint, bears little relation to the bitterness and disillusion in the labour movement . The final breakdown of the Post-War Settlement is seen not in terms of class contradictions and global capitalist forces, but in institutional and cultural terms : the entrenched nature of British voluntarism meant that both management and unions rejected industrial democracy in the workplace, while the Labour party 'was a poor vehicle for corporatism' . Thus, Thatcherism took over, rather like old weeds re-colonising a briefly cultivated garden . This argument superficially touches on the much broader debate on British decline and the 'peculiarities of the British', and is contentious to say the least . But analysing the failure of the Post-War Settlement is not the central task of the book, which is to document the effects of Thatcherite policies on the economy and industrial relations . Here, Maclnnes has marshalled an extremely wide range of research material on British industrial relations, productivity performance, manufacturing output, profits, sectoral developments and employment patterns . Inevitably, this ambitious project can be only a partial stab at reality, but there is a further complication, in as much

as the yardstick for measuring change in the 'British Economy' - which, as Fine and Harris (1985) argue, is a highly misleading notion - is never defined . Does it refer to production within the British nation state, and thus include the operation of multinationals, or is the focus on British capital and its international operations? If the latter, and if the finance sector is included, can one really talk of British economic decline under Thatcher? Maclnnes effectively confines his analysis to British owned manufacturing production in Britain, but discussion of employment decline must also include international capital movements . However, despite analytical ambiguities, the book is a wide ranging compilation of recent data on relations of production in Britain, providing an invaluable resource which is both readable and digestible Maclnnes's main conclusion is that Thatcher's policies have not brought about a major restructuring of employment or industrial relations . Changes in employment patterns are primarily the result of sectoral restructuring of the economy and not changes in policy, and industrial relations institutions have shown a remarkable resistance to change . But lack of clarity about the object of 'restructuring' means Maclnnes often overstates his case for stability . His argument, for example, that restructuring has been stifled by recession confronts the challenge that the creation of 3 million unemployed is hardly an insignificant intervention in the economy . Likewise, the leading role of the State as legislator and employer, the impact of deregulation and privatisation, of employment and expenditure cuts in the public services is so minimised as to be quite unconvincing . Treatment of productivity figures also seems peremptory, ignoring evidence which does show change, while other figures, such as the growth of industrial accidents, while clearly not supporting any Thatcherite

Book reviews 'recovery', but suggesting possible work intensification, are not even discussed . On the other hand, he successfully demolishes many myths of restructuring and recovery, such as the job generation potential of small businesses and self employment, and the emergence of 'new' management employment practices to promote a 'flexible firm' . An important theme in the book is the persistence of 'wage inflation', invoked to show that Thatcherism has not in fact created its much vaunted 'leaner, fitter economy', and that trade unions have prevented the erosion of living standards for those in work . While this may be the case, I have problems with the over-simple interpretation that earnings on their own indicate that labour has held its own . The point is, at what cost? While some groups have managed to bargain good basic pay increases in the private sector, real earnings have also gone up because of a huge increase in overtime . There is also the argument that the widening differential in earnings shows a polarisation between a highly paid, well organised 'core' of male manual workers and other workers ; but disaggregating the figures suggests that what has been interpreted as a polarisation in pay is mainly due to compositional changes - chiefly the loss of male manual jobs in the 'middle' earnings range, and the expansion of the professional managerial group, (Employment Gazette, February 1988 : 82) . This is not to deny the importance of defending living standards as an index of the resilience of organised labour and Maclnnes rightly points out that neither union bashing, nor the single union, no strike agreements of a 'new industrial relations' are as widespread as their publicisers imply . He also points out other indicators of the importance of collective bargaining - such as the growth of unionisation in the service sector . But the over-emphasis on formal institutional stability, such as the continuity of steward

structures is recognised when he acknowledges that : . . . it could well be argued that employers kept procedures intact because they could afford in practice to ignore or circumvent them, that beyond an unchanged formal system lay the reality of new working relationships and weaker union influence', (p . 107) . On the question of 'substantive outcomes' of industrial relations procedures, Maclnnes could draw on both case study and survey evidence which registers that while the direction and pace of work reorganisation remains uneven, managements are attempting to boost labour productivity and effort intensification in the face of heightened competition . And on the question of trade union organisation remaining intact, there is an absence of discussion of the effect of Thatches s labour laws, the use made of injunctions on picketing and secondary action . If Maclnnes's main thesis is that Thatcherism is merely a reassertion of laissez-faire, then what about Thatcher's increasingly centralised, authoritarian strong State and its effects on industrial relations? However, if the 'nothing much has changed' thesis bends the stick too far, it certainly provokes a much needed critique of the meaning of 'restructuring', and the nature of change and continuity . There are bound to be political differences too - such as taking issue with utopian illusions in corporatism . These are the attributes of a challenging book . 'Thatcherism at Work' is an important attack against the 'New Realism' and demystifies the ideological construction that the Thatcherite rhetoric has been made flesh . Reference Fine-Harris 1985, 'The Peculiarities of the British Economy', London 1985 .

153

Capital & Class 154

Capital & Class/Review of Radical Political Economics

Call for Proposals : Special Issue Beyond the Nation-State: Global perspectives on capitalism Socialists everywhere have been faced in the formation and the state, environmental 1980s with a global capitalist offensive . In all degradation, poverty and income distribution . countries, we are debating how to respond to b) particular dimensions of uneven job relocation, attacks on living standards, development, eg industrial relocation, privatization, international indebtedness and migration, and regional, racial or sexual other problems stemming from the relentless divisions of labour 'logic' of international capital . In all countries 3 . The joint editorial committee will play a too, popular social movements seek to more active role in preparing contributions overcome racial and gender oppression, than is normally the case of C&C or the RRPE . militarism and ecological destruction, and Contributors are therefore asked to send a these issues too are linked to global economic proposal ofup to 500 words (2 pp.) for and political power structures . A progressive consideration by the committee . They should also response today must go beyond rhetoric to indicate an estimated date by which they can develop a practice of international solidarity, submit their completed papers . Detailed and this requires a new analysis that goes comments will be offered on proposals beyond the limits of national boundaries. accepted by the committee ; for final The Union for Radical Political Economics publication, the completed papers will be (URPE) and the Conference of Socialist submitted to the usual review procedures used Economists (csE) propose to contribute to this by both journals. analysis by devoting a joint issue of their 4 . Where a submitted paper is not selected journals, The Review of Radical Political for the specials issue, it may be considered Economics and Capital & Class, to current alternatively for a regular issue of either C&C trends in the world economy. The editorial or the RRPE according to the author's wishes. boards of the two journals have set up a joint 5. The deadline for submission of proposals is committee to edit this special issue, which is I stJuly 1989. Proposals may be submitted to planned to appear during 1990 . either journal at the following addresses : Guidelines for contributors I . The title of the joint issue provides an overall framework which we ask all contributors to respect . Papers should deal with current issues, and as far as possible point to policies and practices for social change . Articles should be limited to approximately 5000 words (20 pp .) and they should be accessible to a wide readership. 2 . We are primarily looking for papers which focus upon a) the impact of recent developments in world capitalism on key issues such as class

The Managing Editor RRPE do Department of Economics The University of Utah Salt Lake city, Utah 84112 USA Capital & Class CSE 25 Horsell road London N5 IXL UK

Book reviews

Mike Hales Women - The Key to Information Technology* London Strategic Policy Unit, 1988 Reviewed by Juliet Webster This briefing pack is aimed principally at local authorities and consists of information on and a strategy for the employment of women workers in the IT field . It starts from the premise that the so-called 'skills shortages' in the IT sector could very fruitfully be filled by the ready group of competent but unqualified women already working in the area in various (usually lowgrade) capacities, given an approach to recruitment, training, job design and career development based on equal opportunities and the development of people, rather than on current, hidebound considerations of the internal development strategies of computing departments and industries . Local authorities are addressed, not as providers of training for private sector labour markets (which it considers wasteful of resources and politically misled), but as employers of women, able to undertake changes in the recruitment and * The briefing pack is obtainable (limited numbers) from Centre for Local Economic Strategies, Heron House, Brazenose St . Manchester M2 5HD .

155 organisation of their own direct labour . Developing equal opportunities initiatives in IT employment by utilising the talents and abilities of existing IT workers requires the abandoning of preoccupations with paper qualifications, degrees in particular, and improving both training and the design of women's jobs . The emphasis in the pack on job design is important, because it puts the onus on the employers to move beyond the narrow considerations implied by purely addressing training issues and to focus on the totality of employment conditions career development and in-service training and retraining, for example . This pack is a rare attempt to deal creatively but pragmatically with questions of equal opportunities for women in lowgrade computing jobs . It is an impressive piece of work because it demonstrates a detailed understanding of the issues in training provision, in the computing labour market, and of the dynamics of local authorities . It is also refreshing because it combines a political commitment to overcoming the ghettoisation of women with very practical policy recommendations which address even conventionally-couched problems of labour shortages and thus appear to be 'common-sense' . Moreover, it is imaginatively presented in modules which can be taken separately or together, and well supported with relevant data on, for example, the projected numbers of jobs in different computing occupations . The central argument on the current wastage of ability is clearly illustrated by means of a series of biographical profiles of people doing computer-related work . The main strength of the pack is its identification of problem areas, such as current obstacles to good job opportunities for women in IT, which have largely been ignored in what the pack calls the 'wilful optimism' of many discussions of rr prospects . The specific solutions or policy recommen-

Capital & Class 156

clarions offered are, however, thinner on the ground and perhaps local authority officers would want more in the way of practical guidelines for addressing specific issues . Nevertheless the pack is a very welcome and original contribution to the development of equal opportunities policy in the office, which local authorities, whatever their political complexion, would do well to take on board .

Norberto Bobbio Future of Democracy Translated by Griffin Polity 1987 £25, 0745603084 Norberto Bobbio Which Socialism? : Marxism, Socialism and Democracy edited by R . Belamy Translated by Griffin Polity 1988 £8 .50 Pb 0745601286 Reviewed by Toni Negri Polity Press presents to its Anglo-Saxon readers two collections of studies by Norberto Bobbio : Which socialism?, comprising essays written between 1968 and 1978, concerning the decade which followed from the Italian '68', and The Future of Democracy, which deals with the

period following 1978 . One is not particularly struck by the fact that different periods are being considered, however, and for many years in fact Bobbio has insistently re-stated his theoretical positions with little sensibility to the shortcomings that result from this stasis, given the singularly vital dynamic changes which characterise the historical periods examined . What, then, is the fundamental theoretical-political thesis which runs throughout these studies? It can be stated in the following terms : only pluralist and representative democracy is a 'correct form' of state, and only on this basis can be constructed 'more' socialist relations, or in Bobbio's terms, 'more harmonious and participatory relations .' Consequently there exists a logical continuity between democracy and socialism - but not conversely . Without distorting the meaning of this proposition, one can conclude that while for Bobbio democracy is a constitutional form of state (among other possible alternatives), socialism is not - not to mention communism . Socialist and communist are only adjectives to be added to democracy . In terms of the polemical arsenal of the philosopher, it is apparent how important such a definitional refutation is . For Bobbio, by this line of reasoning both socialism and communism fall . There does not exist, nor can there exist a juridical theory of socialism ; only democracy can be defined . Better still : only democracy can be defined conceptually as an ideal paradigm, while socialism can only be described as a practice - and what a rude practice at that! In the first of the two volumes, during a period in which the class struggle was particularly acute in Italy, Bobbio does not hesitate to continually argue that socialism is essentially a nondemocratic practice . Then, in the second of the volumes considered, during the 1980s when the class struggle was less intense, the discussion is a bit more prudent . Socialism is now granted permission to serve as a

Book reviews

qualifying adjective for democracy, as a prize for workers incorporated into the state as citizens, as the realisation of an innocuous fable about 'more participation' and 'more solidarity' . Bobbio adds that in any case, however one understands socialism, it cannot be discussed other than in terms of disillusionment, while democracy, however compromised, can be discussed in terms of the real, in a Hegelian sense . In sum, the epistemological status of socialism and democracy are radically different, and democracy has more ontological dignity than socialism . The two books are completely dedicated to demonstrating this to be the case . For those familiar with Bobbio's activity both as a politician and a philospher of law, the message of the two books is absolutely clear and predictable . In fact, in contrast to what Richard Bellamy argues in the English preface of these writings by Bobbio, the Turin professor has never been a democratic socialist, nor a social democrat - he is simply a neo-Kantian philospher with a faith in liberalism . What does this definition signify? It signifies that Bobbio is, from the perspective of juridical theory, a formalist who (in the tradition of the neo-Kantian school of Marburg like Hans Kelsen, of whose teachings Bobbio has been one of the most faithful interpreters) considers rights a formal scheme for the guarantee of liberty . From the perspective of political theory, Bobbio is an individualist who considers liberty a completely inalienable attribute of the citizen which, in opposition to society as an abstract sphere, acquires meaning only if understood in terms of standards of individual validity . Finally, from an ethical and epistemological standpoint, he is a pessimist who considers science an instrument to guarantee the efficiency of a 'realistic government', in the belief that 'to be governed' is probably the only possible and attainable goal for political society . In his introductions

Bellamy insists on the specificity of the 157 situation in Turin after World War I and the liveliness of the cultural and political debates taking place there . He reminds us who Bobbio's masters were : Gioele Solair, Luigi Einaudi and Gaetano Mosca . He reminds us of the great political and democratic figures who were students in Turin at that time, as Bobbio himself would be later the Rosselli brothers whom, though liberals . Mussolini had murdered in Paris ; Gramsci . who died from his imprisonment in a fascist jail and condemnation by Stalin ; and Gobetti killed by the blows of the fascists and the betrayal of his liberal comrades . What he forgets to add, however, is that between the masters of political science and the students of politics there existed a larger difference than that which the common anti-fascist position could conceal, i .e ., the difference between the juridical liberalism and political cynicism of the former and the active participation in the class struggle of the latter . If Solari was moved by the political philosophy of Kant, the Rosselli brothers declared that only the class struggle could give new life to the term liberty . If Einaudi accused fascism of denigrating individual rights, Gramsci discovered in the social hegemony of the working class the only remaining source of economic and political productivity in society . If Mosca constructed a cynical and aristocratic theory of political elites, Gobetti rejected any such 'realism' and identified in class consciousness and cooperative worker production the only possible foundation of a democratic society . Bobbio has much more in common with his philosophical masters than he has with their students . In his scientific career, Bobbio moved from the phenomenological formalism of Max Scheler and his juridical followers to existential individualism . He thus became the Italian proponent of the various brands of English empiricism, concluding with functionalism and the pessimistic defence of

Capital & Class 158

Call for Papers The Review of Radical Political Economics invites submissions of articles and book reviews for a special issue on Women and Development . The special issue will focus on the relationship between capital accumulation, women's work in the labor market and the household, state policy, and ideology. The changing position of Third World women, both in the developing and the advanced capitalist countries is of particular interest. We strongly encourage submissions that develop a strong theoretical analysis of the interconnections between class, race, ethnicity and gender . The deadline for submissions has been extended to September 1989 .

Book reviews

democracy. It is true that his long professorial

the possibility of direct democracy, thus in

voyage has been marked by a continuous

juridical philosophy he opposes positivistic

dialogue with the leaders of Italian com-

'realism' (that which in the countries in the

munism, from Togliatti and Amendola to

Napoleonic tradition we call 'institution-

Foa and Occhetto . But it must be noted that

alism') and the most rigid normativism to

this exaggeration of Bobbio's commitment

the jurisprudence of open systems . For

to democracy derives more from the mediocre defence of communism on the part of his

Bobbio, on the terrain of law, the 'lesser

interlocutors than to the capacity of Bobbio

philosophy is realistically directed) is not

to transcend the limits of liberalism . Thus

the democratic state but the state

what can this neo-Kantian professor of

insofar as it is the source of all rights . There

liberty teach us? Nothing but that history of

is no dynamic interpretation or analogical

socialist and communist political thought

method which can free us of the rigidity of

already taught by the neo-Kantians, in which the real movements of the class

form . No, only formalism can assure us that rights will be protected . The relation of

struggle are subjected to the regulative

force, once established and institutionalised

criticism of bourgeois reason, in an effort to

as law, must be repsected in its formal

emphasize the progressive element, in a bourgeois and rational sense, in opposition

validity . Every innovation is transgression . Here Bobbio is without doubt a counter-

to the particular worker and proletarian

revolutionary, though not necessarily a

element. The particularity of working class interests are relegated under the universality

reactionary - since the two concepts do not overlap at all - but rather someone with a

of bourgeois right when possible, or else the

fetish for legality and a horror of all change .

interests of the working class are simply

To say that Bobbio's position with regard to

rejected . Bobbio is first and foremost a priest of the constitutive values of the

legal philosophy is 'anti-communist' does not go far enough . Other well-known anti-

bourgeois state, and all of his political

communists such as Arendt and Habermas

science and his life have been carefully

have worked toward a more optimistic

dedicated to this task, with neo-Kantian precision and formalistic objectivity . One

political and communicative project without

need only observe that Bobbio has always

By contrast, Bobbio is so steeped in it, that

lived in Turin, and yet in the entire corpus

when he ventures out of his own sphere of

of his writings there is not a single mention

interests he winds up 'flirting' with the

of the Turin working class, despite its role as a protagonist in recent Italian history .

blatant functionalism of Niklas Luhmann .

But it is really on the terrain of the philosophy of law properly speaking that the true nature of Bobbio's thought reveals itself for what it is - a vigorously normative

evil' (towards whose defence all of his

tout court,

showing any sympathy for legal positivism .

Let's return to the charge that Bobbio is a counterrevolutionary,

which

is

neither

exaggerated or unjust . On the contrary, scientific conservatism is the direct result of the entire evolution of his thinking . Without

philosophy . Just as in juridical epistemology

doubt, in the university courses (in which he

he from time to time opposes formalism to

excelled) Bobbio consistently developed, as

historicism, the dialectic, and the crisis of

he does in the volumes in question, a

the system, and just, as we will see in a

defence of the 'rule of law' against the 'rule

moment, in political theory he opposes representative democracy not only to direct

of men' . He thus appears to be in the great tradition of republicanism of the Spinoza or

democracy but to any suggestion involving

Harrington type . But this is not the case

159

Capital & Class

160 with Bobbio, in whose writings republicanism loses all of its freshness and the law is exempt from any possibility of popular renewal . The 'rule of law' over the 'rule of men' signifies that the foundations of legal stability will not accommodate the needs and actions of the masses . Yet legality is transformed not by dint of the power of the state, but as an expression of popular sovereignty . In the history of contemporary public law two schools are in direct conflict . The first, of German origin, has always considered the state as the substance of the law . The other, of atlantic origin, has established a dialectical relation between legality and popular sovereignty . In the books we are reviewing Bobbio reveals himself to be, in continuity with what he has always been in the long years of his teaching, a proponent of German public law . It is paradoxical, though only to a certain point, that one can say this of a man who, more than anyone else, has attempted to bring Italian philosophical and legal culture to the atlantic school . If all of what we have said so far is true, it follows that Bobbio's legal and political thought borders on being (or perhaps is without a doubt) yet another variety of the `reason of state' theories : a theory of the state that is not menacing, that has shed all its Germanic resonance, yet which re-asserts itself as an actualised reason of state and as a theory of token democracy . In order to save the state and maintain a minimum of democracy, Bobbio tells us that 'we must, given the lack of plausible alternatives, defend the rules of the game : formal democracy, despite its contradictions and shortcomings, that is to say its guarantee of the right of freedom, periodic elections by universal suffrage, majority rule, or however it is to be understood amongst the parties concerned . All other promises about popular sovereignty, equality, transparence of power, equity, etc, were and are simply excessive

and vain promises which could not be maintained . . . In other words, let's keep this democracy as it is, as a lesser evil . Thus we can do no more than make an appeal to certain values, such as the ideals of tolerance and fraternity, that fraternity which unites all men in a common destiny, all the more ominously so today given the threat of nuclear weapons .' Evidently, we can avail ourselves of the ecological argument against nuclear weapons and their catastrophic effects to stress the profound consensus concerning the 'contractum subjectionis' . Finally and definitely from a logical perspective, Bobbio theorises his fundamental argument in relation to the opposition between direct democracy and representative democracy . The former is the real 'bete noire' of our author . Bobbio warns us in fact that direct democracy encourages a conception of the state that implies a project of practical construction on the part of the political subjects of the state, and this has more to do with a 'form' of the state than with a 'method' for the choice of representation . With extreme pedantry Bobbio seeks to demonstrate that direct democracy is not only a utopia incapable of realisation (especially in societies as complex as ours), but is in fact a dangerous machine for the construction of totalitarianism - or in the best of cases, a scheme for plebiscitary consensus . What can one say? The 'critic' does not stop here . Not only is the direct democracy of Rousseau and the Jacobins subjected to the most ruthless criticism - he must go further still . Both consensus and participation reveal themselves to be highly problematic determinations in democracy . They comprise his so-called 'broken promises', broken because they were incapable of being kept in the first place . What is to be done, then? Even in this case we must satisfy ourselves with what is possible and realistic . Thus the principle of frustration dominates the science of constitutional and



Book reviews

public law . Further, political representation, in the form of delegation, more than an unshakeable foundation of democracy, is part of the 'social division of labour' which constitutes the fabric of liberty in our contemporary societies . As is evident, without hypocritical distortions, this socalled 'pluralism' (laws : division of labour) is wedded to this so-called 'representation' (the transformation of the contract of union into that of subjection), thus generating the 'free world' . However, Bobbio asks, would we prefer socialism like the Russians have? I confess a certain discomfort before the finesse of such derivations . Is it, however, legitimate to ask what remains of representative democracy once the critique of direct democracy has been taken to such extremes? Following both Bobbio's writings and what he says, one remains struck by the fact that his 'realism' (more appropriately called 'soft Machiavellianism') leads inexorably from defeat to defeat . What we have is a continual growth of a species of political and intellectual masochism, with which he guides us through his critique, which by now has become 'critical criticism' . His argument constantly turns on the same theme, democracy, fetishising it and revealing the ideological inconsistency of the concept itself . But in the face of this nihilism he does not affirm the necessity of life and the revendication of subjectivity against the eternal reflux of useless events, which would be the ultimate conscious act of revolt of the free and conscious man, but rather the virtues of obedience . Thus how strange it is that Bobbio insists on connecting the names of other democratic authors to his obstinate and empty reiteration of desperate faith in democracy! Why on earth does he do this? Let's look at Bobbio's writings on Gramsci . Leaving out the polemics of another time period, it seems to me that Gramsci emerges in an optimal C&C 37-K

critical perspective as the author of a 161 vigorous synthesis of democratic radicalism and Leninist volontarism . Why then does an historian of Bobbio's intelligence fail to understand that direct democracy, even in the form conceived by Gramsci in the desperate solitude that afflicted him (and the entire working class under fascism), is worth more than all of the 'realism' that the state can conceive of and Bobbin can ideologically justify? That direct democracy, in the form conceived by Gramsci as the social productivity of the exploited classes, is the true, perhaps only force that moves and propels the historical process? And finally that fascism was not destroyed by liberalism, by the virtuous unity of pluralism and representative government, but by the desire of the masses for direct democracy? In contrast to Bobbio, I believe that in working for direct democracy we will succeed in responding to the needs of our time : to destroy the capitalist state and build communist democracy, and perhaps in that way even save formal democracy .

* Translated from Italian into English by D. Schecter .

Capital & Class

162

John Holdford, Reshaping Labour Croom Helm, 1988, HBK, £30 . Reviewed by Ewan Davidson Armistice 1919 : 'the Rubber workers dispatched a congratulatory telegram to Sir Douglas Haig 'on the Great Victory achieved by Greater Britain and her allies in the War, now happily over' that the EC called together on the cessation of hostilities for the purpose of declaring a General Strike to establish a dictatorship of the proletariat in this country', rejected it, and did likewise . The main aim and achievement of this interesting and well-researched book is to capture the sense of possibility and uncertainty experienced by the labour movement in the early 1920s - and to explore how the intertwined strands of syndicalism, Bolshevism, reformism, industrial unionism and moralism developed into the now familiar structures of Labour and union politics . As the author states - in 1919 'within the mainstream of the movement there was an ambivalence ( . . .) it was therefore by no means inevitable that war-time developments would lead to the dominance of the post-1918 Labour Party' . Yet by 1926 and the time of the General Strike, there was no doubt of the dominance of the Labour-union polarity in working class politics . What had happened to bring this about? The question is considered through a detailed study of the Labour movement in Edinburgh making use of the extensive records of Trades Council, union, and socialist records which exist here . In structure and development the book follows the following logic . In the period covered the national economy shows a

pattern of war production, boom (19191920), slump (1921-1923) and unsteady recovery (1923-1926) . State attitudes, seen through the national institutions, greatly strengthened through the war years, reflect this pattern . In summary, they follow courses of national reconciliation, concession to union demands, and then an abrupt return to asserting the needs of profits and confining the legitimate activities of the unions . These attitudes are reflected through the popular press, management decisions, and the tactics of the labour movement itself. The author is at pains to point out that the labour movement was to a great extent a prisoner of popular beliefs - in the Gramscian terms in which the argument is couched, they had developed not 'hegemonic' ideas of their own . As a result although they were able to benefit from the development of ideas about 'national interest' in the war years, and gains legitimacy as the representative of labour, they were unable to retain their membership and power through the slump . The nature of response of the labour movement to these events froms the main subject matter of the book . The loss of confidence produced by the slump is reflected by debates carried on in the movement . Two main responses emerge - the first a shared, organisational one ; the second a strategic controversy . The first part of the response is a drive towards organisation and efficiency, in part forced on the movement by the rapid increase in union membership immediately after the War - for example the rubber workers union had to assimilate over 1200 members within 3 months of the formation of an Edinburgh branch . Holford quotes examples which suggest that membership grew more in spite of than because of existing structures - which partly explains their subsequent preoccupations . However, a more important factor appears

Book reviews

to have been the spread of Taylorism and its mechanistic organisational metaphor . In practice, as is pointed out in the study, few British employers were able to make use of its prescriptive format, but it was in these terms that both managers and socialists came to consider their tasks . 'The new Trades and Labour Council is not a debating society, an economic class or a school of sociological philosophy . It is a machine' . We are not school masters - we are mechanics cries the first Annual Report of the body the labour movement created to merge the new Labour Party with the more established trade union representative body . Of course it was not . In the years of the slump the machine lost a lot of its parts, while the attendance records of Trades Council and union meetings cited by the author (falling absolutely and per member in this period) suggest that the 'mechanics' found their task too demanding . However, it was again the Taylorist model which was used to explain their failure - tighter, more streamlined and professional organisation was needed . Rules and constitutions were drawn up, a full-time Labour Party secretary was appointed for the first time, while the union section of the movement attempted to normalise its activities through participation in national and local bargaining structures . Linked to this process was the tactical controversy over 'direct action' - strategies which called for 'irregularity' and anticonstitutionalism . Holford points out that even such figures as MacDonald and Snowdon had been willing to sanction 'direct action' in the immediate post-war era. However, in the reorganisation of the movement, and partly as a result of the depression, these tactics fell into some disrepute, and began to become a target of attacks from other parts of the movement . As, in Holford's words, 'the main functions of unions ( . . .) became the control of members', so the Trades and Labour Council, through its

constitution and the action of its office 163 bearers, came more and more to try and regulate the activities of those sections which retained an affinity for direct action such as the Independent Labour Party and the new Communist Party . These brief struggles set in place the cornerstone of the British labour movement - unions concerned only with 'industrial issues', and represented politically via the Labour Party, which confined itself to constitutional political activity (and leaves the unions to their own field) . The author sees this polarity as characterising the subsequent development of the Left in Britain - strength in electoral terms, deeply conservative, and 'responding to change ( . . .) by exclusion and intensified internal dispute rather than by attempting to ally ( . . .) to lead' . Edinburgh seems to me a fairly atypical city from which to generalise on events in the British labour movement . The unusual industrial base of the city, carefully documented here, has meant that mass workplace organisation - such as the shop stewards movement, so important in Clydeside and the English Midlands in the 1920s were not a feature of local politics . Edinburgh politics also owed a lot to the disproportionately large bourgeoisie in the city and to notions of working class self-advancement promoted by local religious groups . These are reflected in the local labour movement - but would hardly be repeated nationally . The importance of sectarianism in the Scottish society is also, perhaps not surprisingly, not reflected in Holford's source material - yet within 10 years working class wards were returning 'Protestant Action' candidates as part of a virulent anti-Catholic campaign . Another disappointing omission is of discussion (after a brief note) of the activities of the 'Trade Union Organising Committee' - an organisation begun by the Trades and Labour Council to 'create working class



Capital & Class 164

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1988

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Joseph Needham's vision Darwin : man and metaphor

Book reviews consciousness' in

1922 .

Holford suggests

165

that the failure to create this was a crucial error . Whether this initiative sank without trace, or does not have documented records is not made clear, but some analysis of its

Bob Arnot

efforts would have been a useful adjunct to the book .

Controlling Soviet Labour :

Although it is therefore a bold leap from a

Experimental Change from Brehznev to Gorbachev

case study of 1920s Edinburgh to general

Macmillan Press, London 1988,

theories about the labour movement, I

hardback pp . 305, £35 .

would applaud the author for his commitment . From my own experience the problems

Reviewed by Frank Furedi

he identifies still plague left politics . The current campaign against the poll tax again

The slogans glasnost and perestroika have

divided the movement over issue of the

captured the popular imagination on both

legitimacy of extra-parliamentary action . The Taylorist organisational metaphors

sides of the East-West divide . But are they more than just slogans - can they be

which the Labour movement developed in the 1920s linger too - a motion to the Anti-

Bob Arnot's interesting study of Soviet

Poll Tax Federation in Edinburgh in May

experimentation in the sphere of work

1988 calls for it to run itself 'as a professional

provides useful material for the consideration

organisation (- . . .) as well organised as the

of the viability of perestroika.

Tories' . Holford's diagnosis of the problem of the

implemented and actually made to work?

The main focus of Arnot's test is the

with his suggested solution . Following

experiment launched at the Shchekino chemical plant in Tula province in 1967 . Through the rationalisation of the plant the experi-

Gramsci, he suggests that the working class

ment sought to tighten internal labour

must achieve political hegemony by 'creating

organisation and reduce the workforce .

a strata of intellectuals, who will not merely

Alongside this restructuring of the labour

generate ideas but disseminate them, organising the rising class .'

process a new system of incentives was

The weakness of the book is that it does

workforce with higher wages and access to

not consider the practicality of this idea .

improved social benefits . The result of the

However, the sense of the historical and

experiment was impressive . Within the first

arbitrary nature of Labour's institutions which it imparts is very important, and to

two years of the experiment output by

this end the book is a valuable contribution .

productivity of labour increased by 87 per

Left is stimulating, but I have to take issue

introduced which provided the reduced

volume grew by 80 per cent and the cent . The Shchekino experiment showed what everyone suspected all along . Soviet industry suffers from an inefficient use of resources, underemployment and low productivity of labour . With a more rational organisation of resources and a system of real incentives a substantially reduced workforce is capable of achieving significant gains in labour pro-

Capital & Class

166

ductivity . Consequently Soviet economic experts and politicians were highly motivated in extending the experiment to other sectors of industry . In 1975 this orientation received the backing of the leadership of the Communist party of the Soviet Union and the Council of Ministers . Arnot's study attempts to explain why it was that that experiment which initially showed such promise could not provile similar results in other sectors of Soviet industry . According to the author the extension of the Shchekino experiment brought uneven results . In areas of industry with a high intensity of labour where direct producers had considerable control over their work, such as in mining and construction, the experiment was hardly implemented (p . 199) . It was in the more technologically advanced sectors that the experiment had most success . Arnot suggests that there was a clear link between the importation of foreign technology and the implementation of the experiment . In these cases technically determined patterns of work could be used to break down the traditional forms of control exercised by direct producers (p . 200) . Arnot concedes that it is very difficult to provide a clear-cut explanation for the uneven generalisation of the experiment . However, what is clear is that this experiment like many others failed to provide a solution to the problem facing the Soviet economy . Arnot's analysis of Shchekino is strongly influenced by the theoretical approach developed in the journal Critique, and in particular by its editor H .H . Tictin . From this perspective, the failure to reform work practices through experimentation stems from the very nature of the Societ socioeconomic system . As Arnot argues the problems of Soviet industry 'should be located in the antagonistic nature of the social relations of production in the USSR and the specific effects these relationships have on the process of surplus extraction' (p .

2) . Thus to put the argument crudely, experiments are by their very nature technical solutions to what are in fact deeply rooted social problems . The main strength of Arnot's work is that it provides a thorough study of the experience of experimentation to demonstrate the relevance of the Critique argument . Reforms in a single or a group of enterprises can only promote modest results since any gains are counteracted by the effects of an unreformed external environment . Partial market orientated reforms must fail without the introduction of the broad structures of market relations . Arnot concedes that reforms can realise limited gains at least for a temporary period . It would have been useful to consider in greater length the areas where limited gains could have been made since it would have thrown light on the dynamic of Soviet economic policy . Indeed Soviet economic policy appears to consist of a cycle of experiments whereby new reforms are tested as the limited gains made by the previous ones are lost . There is now evidence that a significant section of the Soviet leadership is aware that the technical solutions provided by the experiments fail to address the problems at hand . Gorbachev for one has argued that economic reform itself requires political change . As he told the Central Committee of the cPSU, 'a house can only be put in order by someone who feels that he owns the place . Our perestroika is possible only with democracy' . The recognition that popular participation and democracy are the preconditions for economic progress represents an important step from the previous technically dominated discussion . However, the relationship between perestroika and popular participation is not straightforward . One of the main objectives of perestroika is to increase labour productivity through increasing the rate of exploitation of workers . As Arnot suggests this requires

Book reviews

greater control over Soviet labour . Obviously the type of control that is sought is economic without 'continual direct administrative intervention' (p . 253) . However, the very consolidation of such control itself threatens to bring to the surface the antagonism inherent in the relationship between direct producers and management . The search for new forms of labour control by the Soviet leadership is fundamentally in conflict with its promises of political change. It would be foolish to speculate about the future direction of Soviet society . The Soviet Union is in a state of flux and at times it appears that no one is fully in control . Controlling Soviet Labour provides a much needed antidote to the euphoria about glasnost and perestroika . It brings the discussion down to earth by focusing attention on the antagonistic character of social relations in the Soviet Union .

John H . Dunning Japanese Participation in British Industry Croom Helm, London 1986, Hb, £30 . Reviewed by Manabu Kasamatsu and Masato Sato This book is based on a report prepared for the Department of Industry in 1984 . It contains the results of a field survey of 23 Japanese manufacturing affiliates in the UK, conducted between July 1983 and March 1984 . The purpose of the survey is to answer the following questions :

1 . to what extent has direct investment by Japanese multinational enterprises aided the transfer of Japanese management styles and technologies to the UK economy? 2 . what are the incentives and obstacles to such a transfer? Japanese management styles are neither innate nor invariable . In fact Japanese capitalism needed both the economic and military support of the us in order to establish Japanese management styles . Moreover Japanese management styles have already been modified under the pressure of low economic growth . It is interesting to note that the impact of Japanese affiliates on UK suppliers is investigated much more intensively than their impact on UK competitors and customers . As such, the book focuses on the way supply industry adjusts to Japanese affiliates in order to maintain or even increase their market shares . Given the small number of Japanese enterprises and the short length of time they have been located in Britain, it seems premature to draw strong conclusions about the impact of Japanese participation in British industry . However, it is interesting that Dunning forcefully argues that there is no Japanese technological, marketing or managerial miracle . As Dunning states, the success of Japanese companies is their ability to supply the consumer with a fault-free product and to coordinate their quality control procedures by the appropriate management philosophy and work organisation . As such, it is suggested that UK companies know the principles of management for successful business, but simply have not applied them and have not, unlike the Japanese, thought of quality control, inventory control and employee motivation as important factors . Hence, Dunning concludes that in theory it is possible to transfer Japanese management styles and technology

167

Capital & Class

168 into the UK . The problem with the book is that Dunning appears to be too optimistic about the universality and efficiency of Japanese management styles . It may be the case that Dunning has not fully taken into consideration historical, cultural and economic conditions under which Japanese management styles can work . Also, Dunning neglects the fact that Japanese management styles entail costs, in the broadest sense of the word, despite the potential gains to employees through arrangements such as profit sharing . Regarding the future of Japanese management styles, Dunning reports conflicting forecasts . The question is whether Japanese management styles have been successfully introduced into the UK, in spite of the differences in attitudes to work in Japan and the UK, or whether the Japanese work ethic will eventually be assimilated by the western attitudes to work . Why could it not be possible that Japanese work ethics will accommodate with Western European ones? Dunning has no clear answer to this question . In spite of this criticism, the sound factfinding work of Dunning seems to us to be a particularly necessary contribution in a field where arguments are likely to entail impressionistic opinions .

Simon Clarke Keynesianism, Monetarism and the Crisis of the State Edward Elgar 1988 pp . 365 . Reviewed by John Holloway This is the CSE at the very pinnacle of its achievement . It is very much a CSE book : Simon Clarke draws explicitly on CSE debates over the past fifteen years on the theory of money and the theory of the state in this monumental book (365 densely packed pages), which aims 'to develop a more adequate framework within which to grasp both the coherence and the complexity of the relationship between economics, politics and ideology in the crisis-ridden development of capitalism' (p . 13) . The undertaking is enormous . The approach is historical . Starting from the theory and practice of mercantilism, we follow the interweaving of money, the state and economic theory through Adam Smith, David Ricardo and political economy and their relation to the development of the state in the nineteenth century ; through marginalism, imperialism, the First World War, the crash of 1929, on to Keynes, the Keynesian Revolution ('not so much a scientific or political as an ideological revolution' (p . 221)), and then on to the crisis of Keynesianism and the adoption of monetarism as the latest state ideology .

Book reviews

The book is so full of insights and themes

to resolve the contradictions of the liberal

that it is difficult to summarise its main

state form . . ., based on the rationalisation

argument . Perhaps this does not matter so much, since the book should in any case be

and generalisation of the systems of industrial

compulsory reading for any member of the

representation within the framework of the

CSE and for anyone interested in the area .

One important theme that runs through

liberal state form and the liberalisation of the world economic system' (p . 20) . The

the book is the historical development of the

crisis of Keynesianism is a crisis of the state

state form and its relation to money and the

form, with the separation between state and

changing theories of money . As Clarke says,

civil society coming under pressure from

following Marx, 'the capitalist character of

both labour and capital . For the moment, it

the state (is) determined . . . not by the subordination of the state to interests that

seems that capital has won the struggle over

arise in civil society, but by the radical

alternative to a resolution of the crisis on

separation of the state from civil society and

capital's terms was the revolutionary trans-

the former character of state power that is

formation of the state form to reintegrate

the essential characteristic of the capitalist

the state and civil society on the basis of the

state form' (p . 125) . It is the separation of the state from civil society that subordinates

political mobilisation of an organised popular

the state to the social power of money and

tions of a united working class' (p . 316) .

thus imposes limits to the achievement of

But the apparent victory of capital is far

social reform through the state . Clarke traces the establishment of the separation of

from being definitive, since the underlying

the state from civil society through the

barrier to accumulation presented by working

electoral and especially administrative reforms

class aspirations did not resolve the crisis of

of the nineteenth century, a process bolstered by the theories of political economy . But the

overaccumulation' (p . 349 ; and see the article in this issue of Capital&Class) .

relations, social administration and electoral

the state form, since for the Left, 'the only

movement that could articulate the aspira-

crisis is not yet resolved : 'the removal of the

state form is always the object of struggle :

The theme of the state form inter-

class struggle constantly takes place in and against the existing institutional forms .

weaves with a number of other major

Thus, the separation of the state from civil

pression of the overaccumulation of capital ;

society was complemented by the develop-

the theory of money 'as the most abstract

ment of industrial relations, social adminis-

form of social property, and so as the

tration and the extension of the franchise as

supreme social power through which social

institutional forms for containing working

reproduction is subordinated to the repro-

class struggle within certain bounds . The

duction of capital' ; the contradictory form of

key to the constitutional relation between

the nation state in the face of the global

the working class and the state lies in the

character of capital accumulation ; the ex-

fact that 'the working class was admitted to

position and critique of the major schools of

the constitution not on the basis of class,

economic theory, showing how the different

but of citizenship' (p . 163) .

conceptions of money related to the developing form of the state : the different economic

Keynesianism, by generalising the insti-

themes : the theory of crisis as an ex-

tutional relation between working class and

theories, although taken seriously and criti-

state, is a particularly developed expression

cised on their own grounds, are shown to

of the state form : 'the Keynesian Welfare

owe their influence to their success as 'ideologies of the state' (p . 12), which 'serve

State is . . . the culmination of the attempt

169

Capital & Class 170 more to legitimate then to guide political practice' (p . 1) . This is an immensely rich book, and my only complaint, as a reviewer, is the complaint of someone who has just eaten a very rich meal . There is so much in the book that it is difficult to digest and difficult to engage with . I am tempted to just stand on the sidelines and applaud the critique of factionalism which is central to the account of the power of money, which 'is not the power of banks and financial institutions (but) the power of capital in its most abstract form' (p . 5) ; to applaud the critique of reformism implicit in the concept of the state form ; to applaud the critique of 'new realism' contained in the analysis of the continuing crisis of over-accumulation, the critique of regulation theory and of structuralfunctionalism implicit in the historical approach, etc, etc . And yet it is important to engage with the book if the argument is to be carried forward, if we are not to spend the whole of our lives in dialogue with slain dragons (or great bears) . My own hesitations about the book concern Simon's treatment of valueproduction-class struggle-crisis-history- state . For me, what was important about the state debate was not just the emphasis on the political and economic as forms of the capital relation, but also the emphasis on the capital relation as an historically specific form of struggle-and-domination, rooted in production . The key to understanding the development of the state is thus the struggles around production, around the changing forms of exploitation of the working class (hence the crude but basically correct discussion in 'The Red Rose of Nissan' (Capital &Class no . 32) . In Simon's account, production is very much in the background . Its importance is not denied, but, perhaps in order to avoid a 'reductionism in which the forms of regulation of accumulation are determined by the

social form of the labour process and the structure of production' (p. 8), the struggles around production do not play the central role one might have expected in an historical account of capitalist development . The fact that production is left off-stage has consequences for the rest of the analysis . Value, for example, remains a rather shadowy figure, although much of the book is about money . The working class, too, is not clearly defined : it is a constant force, a constant threat to be contained by capital and decomposed through the state form, but its historically changing composition remains unclear . Perhaps most important of all, the relation between class struggle and the theory of crisis as the overaccumulation of capital remains unclear : hence the analysis of the current situation as being one in which, although the working class has been decisively defeated, the crisis of overaccumulation remains unresolved . As a result, one part of the conclusion, that 'the necessity of socialism has never been more urgent' (p . 359) flows naturally from the previous analysis, but the other part, that 'the subjective conditions for socialism are also more fully developed than in any previous period of history' (p . 359), appears much more forced . It is only by grounding the analysis of crisis squarely as the crisis of a particular pattern of relations of exploitation/domination/struggle that this dualist tension can be overcome . I have pushed myself to make these criticisms because, as always, I find Simon's analysis intimidatingly good . This book, however, is not just to be admired, but to be discussed . A short review is quite inadequate to do that : it is to be hoped that this will be the start of the long and fruitful discussion that the book deserves .

Book reviews

Bo Strath The Politics of De-Industrialisation : The Contraction of the West Europea : : Shipbuilding Industry Croom Helm, London, 1987, pp . 295 . Reviewed by Mark Quigley In this detailed, well researched study, Bo Strath examines state intervention and the politics of deindustrialisation in six countries (Denmark, West Germany, Sweden, France, the Netherlands and the United Kingdom), Focusing on the decline of the shipbuilding industry during the second half of the 1970s, the author provides a wide-ranging and impressive account which is particularly good in documenting the industry's history of shifting fortunes and structural change since the early 1960s . Three-quarters of the text is concerned with national variations in the conditions and responses of workers, employers and state, and the remaining

quarter looks (very briefly) at the theory of the state and the possibilities for the formation of national and international policies to deal with the exigencies of structural change . Strath gives central attention to the differing policies of the state in the six countries, in mediating international competitive pressures and in devising and implementing policies to abolish excess shipbuilding capacity . His treatment is never uninteresting, yet ultimately it fails to satisfy . For what is does not explain is why state intervention took particular forms in different countries at different times ; why, for example, it sometimes took the form of subsidies, and at other times nationalisation . Strath does not probe the structural and institutional influences and constraints on industrial policy formation, nor does be explicitly recognise class struggle as a key dynamic in the state-industry relationship . In short, he offers a non-materialist, nondialectical account which leaves many questions unanswered . These weaknesses are most evident in the final section of the book, although they suggest themselves in the earlier chapters which deal with specific national trajectories . Two examples help illustrate the deficiencies of his treatment . First is his discussion of the 'Bremen Studies' of 1980/1, which document the efforts of West German shipbuilding workers to shape state policy . Strath suggests that class antagonisms were absent, that there were 'few examples of a perspective critical of shipbuilding capital', and that the state was perceived by the workers as a 'coordinator' acting above sectional interests . Close inspection of his evidence, however, does not really bear out this interpretation . A similar perspective informs the author's assent of developments in the UK industry . Strath is correct to argue that British workers and their unions wanted the state to

171

Capital & Class

172

help restructure shipbuilding capital . But

terms of the details of the workers' experience

he is wrong to interpret the events of the

of nationalisation . Unable to influence the

1960s and 1970s in terms of absence of class conflict and antagonism at the level of the

passage and hence the terms of the National-

state . The history of workers' struggles in

the Dept . of Industry (by Harold Wilson),

the British shipbuilding industry reveals a

workers were subjected to real wage cuts,

isation Act after Tony Benn's removal from

series of (largely unsuccessful) attempts by

frequent lay-offs and job losses . In short,

labour to shape the terms of their accom-

deteriorating terms and conditions . Not

modation with capital and to transform

surprisingly, they came to view nationalisa-

social relations within the industry through

tion as a disaster, in some respects worse

nationalisation . Recognising that their jobs

than their experience of private ownership .

would remain in jeopardy as long as the

In these circumstances the willingness of the

industry was organised as private capital,,

trade unions to co-operate with management

British workers campaigned to have the

was not wholly surprising, for the mood of

industry brought under public control . The

the rank and file was moving decisively

Labour government resisted their demands

against a prolonged collective fight . Strath

during the sixties, but took a different view

in his treatment glosses over the detailed

in the aftermath of the historic 'work-in' at

history of this period, and hence does not see

the Upper Clyde shipyard in 1971/2 . Strath

any material basis for the co-operation

records this change of heart by the British

(compliance would perhaps be more accurate?)

state, but is unable to make sense of it because, as noted above, he does not assign a

to which he assigns so much importance . Though I have concentrated on the

role in his analysis to class struggle .

problems with Strath's analysis of the

His treatment is schematic and tentative .

British experience, these examples are illustra-

While noting (p . 129) that 'the decision to

tive of the more general problems which

nationalise British shipbuilding did not . . .

handicap the argument . It is unconvincing

represent a simple accord between the

in its treatment of labour relations, the

government and unions', Strath fails to

politics of the state and the nature of

pursue the point and instead emphasises

material conflicts under capitalism . The

local level co-operation between unions and

book's narrative is informed by a deep

management and their efforts to secure from

antagonism towards functionalist theories of

government more (short-term) funds for the

the state, whether Marxist or Liberalist

industry . Further problems surface in his

inspired, yet the author does not himself

account of the limited opposition of British

succeed in establishing a distinctive frame-

workers to the contraction programme set in

work of analysis . In particular, the state is

motion in the late 1970s . For Strath what

left floating in his account : there is no

stands out most from this period was the

systematic attention to the means by which

extent of co-operation between the Con-

the state organised (and disorganises) classes

federation of Shipbuilding and Engineering

and their strategies, nor of the state's

Unions (csEu) and British Shipbuilders (Bs) . The relationship led to 'concerted

structural position within the capitalist economy .

action for contraction resulting in a social

In response to these charges, Strath would

plan which individualised the threat of

perhaps object that in posing such issues one

unemployment' (p . 153) . There is a lot of truth in this assessment,

is merely attempting to force history into a

but it needs to be viewed in context, in

view . Yet, until the final pages of the book,

narrow structural-functionalist, state centred,

Book reviews

Strath offers no alternative framework of analysis, and it is this silence which diminishes the achievement of this otherwise valuable enterprise . There are approving references to the works of Dahrendorf, Zeitlin and Skocpol scattered in the text and footnotes, but these are not drawn together to provide a convincing and sustained account of state power and politics . Moreover the brief discussion of Marxist state theory is scarcely adequate . Given the author's keenness to establish distance from this approach, one might have expected more than a few comments on Habermas . In short, the book contains some very useful material on the nature of the decline of the West European shipbuilding industry and for this it is well worth reading . But for those looking for a more theoretically searching treatment of the position and politics of the state, the book may well prove to be a disappointment .

173

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