Sunday, 14 December 2014

Bush and the Brazilians

This being December, I have been reading more about mathematics. However, this was in the context of the excellent Simpsons cartoon, on which the science writer Simon Singh has produced an illuminating book: The Simpsons and their Mathematical Secrets (Bloomsbury, London, 2013).

The book is too good to summarise in a brief note, but I just wanted to share one of the jokes he presents as an aside from the interesting analysis:

'During a security briefing at the White House, Defense Secretary Donald Rumsfeld breaks some tragic news: "Mr President, three Brazilian soldiers were killed yesterday while supporting US

'My God!' shrieks President George W Bush, and he buries his head in his hands. He remains stunned and silent for a full minute. Eventually, he looks up, takes a deep breath, and asks Rumsfeld: 'How many is a brazillion?'

Tony Norfield, 14 December 2014

Sunday, 7 December 2014

Labour's Colonial Policy

This article is based on notes prompted by reading an interesting book, Imperialism and the British Labour Movement, 1914-1964, by Partha Sarathi Gupta, published in 1975. I find it particularly of interest because it presents some original material from a time when the Labour Party will claim to have been 'socialist' in some sense. So, this article can be seen as an anti-nostalgia exercise! Things never were any good with this pro-imperialist party.
Gupta has extensive documentation of debates in the House of Commons, Labour Party conference speeches and policy recommendations from such bodies as the Fabian Colonial Bureau and the Movement for Colonial Freedom. He also gives examples of the racism of many leaders of the 'labour movement', especially regarding Africa. More important for my current purpose is that he highlights how Britain's plans for colonial development were always presented as being mutually beneficial, but were always based upon Britain's needs and in directions determined by the colonial rulers, not by the local populations.
The book is a dry read, and with a number of questionable views, for example that by the early 1960s 'social imperialist sentiment had been eliminated' in the UK (p. 393). However, it offers some striking comments and statements that illustrate the 'socialism in words' and 'imperialism in deeds' perspective of the Labour Party in the 1940s and 1950s that I will set out below. A good summary of Labour politics is given in Gupta's conclusion to a chapter on 'Colonial reforms':
"A large body of opinion inside the [labour] movement was representative of 'little Englanders', who were preoccupied with social transformation at home and anxious to avoid military and political engagements abroad. In moments of crisis a social imperial syndrome became active. Though it was originally noticed mainly among those trade unionists who were least affected by socialist ideas, the imperialist bias displayed by Bevin in general [Ernest Bevin, Labour's staunch anti-communist Foreign Secretary, 1945-1951] and by John Strachey over the groundnuts affair [see below] showed that persons with a Marxist background could slide easily into a social-imperialist position once they became pre-occupied with building socialism in their own country only." (pp. 346-347)
Despite the little Englanders being 'anxious to avoid military and political engagements abroad', Gupta does not mention that there was no labour movement opposition to Britain's military efforts to re-establish its own and other European colonies after 1945, possibly because these used Indian and recently defeated Japanese troops against local nationalists in Asia, and hardly any British troops. But, I will turn attention to the more direct British dimension of colonial economic exploitation.
The first example is John Strachey. Named in House of Commons records as Evelyn Strachey, MP for Dundee, and with the more elaborate nomenclature on his birth certificate of Evelyn John St Leo Strachey, he was an outcome of Eton and Oxford and an itinerant politician (see his Wikipedia entry) with successive socialist, Mosley, Communist, anti- and pro-Keynesian views. He was also a Minister of Food and a Secretary of State for War. Despite these dizzying turns, throughout his life he remained a consistent British nationalist. In a January 1948 House of Commons debate on the Colonial Development Corporation bill, he concluded:
"I should like to end this discussion by striking this note, that by one means or another, by hook or by crook, the development of primary production of all sorts, in the Colonial areas, Colonial territories and dependent areas in the Commonwealth, as well as generally throughout the world, in far more abundant quantities than exist today is, it is hardly too much to say, a life and death matter for the economy of this country."
This perspective was behind his support for the infamous groundnut scheme in Tanzania, then called Tanganyika. Britain's plan to plant groundnuts in an unsuitable region with idiotic technology turned into a loss-making fiasco and was abandoned. However, while this is often seen as a dumb development project, the basic notion behind it receives less attention: it was to use cheap labour in the colonies to grow products that would feed the British back home, and so reduce the need to import from outside the Empire. This would avoid paying in US dollars for some food supplies when there was already a shortage of dollars in Britain's reserves. Instead, the producers of Tanzania would receive payment in terms of a devaluing sterling.
The groundnuts scheme was only one case of colonial exploitation, realised or planned. More importantly, Britain had a number of marketing boards that were monopoly buyers of the commodity output of its colonies, and limited the development of any processing operations so that they received at best, and usually below, the world market price for the raw commodity. House of Commons Parliamentary debates always argued that a 'fair price' was being set, and that the buying operation carried risks to Britain's finances. But the buying prices were always set at below what the market price turned out to be. Furthermore, the surpluses from selling these products on the market always ended up in sterling balances based in London banks! This was how the system worked.
In a May 1951 debate on the West African Marketing Boards, one Labour MP, the Rugby and Oxford educated barrister, Richard Acland, made the following comment as part of a longer apologia:
"Firstly, the prices in the long-term contracts made by our Government were perfectly fair prices, there being genuine arguments at the time of the contracts to suggest that world prices for the crops might have fallen. But in fact that has never happened and the opposite has always taken place. To give an example: We are purchasing West African palm oil at £94 a ton, when the same oil on the free market has been fluctuating from £134 to £210 per ton."
What a stroke of luck that no West Africans were listening! Just in case they were, he denied that the amounts concerned were of any significance.
This is not to say that Labour MPs were being too truthful, and not forward-looking enough. How forward-looking, to see the way in which British imperialism's economic stresses could be solved so that we could have a 'Jerusalem builded here', on the backs of the colonies, is shown in the next quotation. Harold Wilson, a future Labour Prime Minister, had this to say in the House of Commons when Labour was in opposition in February 1953:
"There are very many schemes that can earn and save dollars and we want to know about them. There is copper in Rhodesia and Uganda; zinc and lead in Nigeria and tin in Uganda and British Honduras. We have to face the working out of the tin reserves in Malaya, before many years are over. There is, too, bauxite in Jamaica, manganese in India and South Africa, tungsten in Uganda, beryllium in India and columbium in Uganda. I am sure that these things are being considered by the Foreign Secretary, and what we should like to know at some convenient time—I would not press him to answer in detail tonight—is what is being done to press on with these schemes.
"Perhaps the most important step in the Commonwealth development [sic!] would be for the Government to work out now a wide-ranging geological survey of Colonial Territories ... I do not think that anyone in the House would deny that the answer to all our dollar problems may well be found 200 or 1,000 feet below the soil in the Colonial areas, and a really imaginative geological survey might possibly solve a lot of our problems over rather a long time."
The economic policy in the colonies, now given the honeyed description of 'Commonwealth' rather than Empire, was to meet British imperialism's requirements. That is not a surprise for critics of imperialism, but let me leave you with a sickening Labour socialist conclusion. Recognising that the Empire, sorry, Commonwealth, may not persist on the same footing, noting the colonies' contribution to the Sterling Area balances and expressing a desire that colonial peoples have a better future, Jennie Lee, wife of Aneurin Bevan, the Labour left saint, had this to say at Labour's Annual Conference in October 1956:
"We have to work for the day when there will be a higher standard of living here, a higher standard of living in the colonies, and when as free and friendly nations they will want us to be their bankers." (p. 376)
She was ahead of her time. The City of London today is the biggest centre of global banking, despite Britain having a much worse current account deficit than when she was speaking. British imperialism found other ways of appropriating the value of what others produce.

Tony Norfield, 7 December 2014

Wednesday, 12 November 2014

Rosetta and Ebola

The technical achievements of the Rosetta space programme fill the news headlines, at least in Europe. The near-$2 billion price of the expedition is considered trifling. Here is a celebration of human ingenuity! But here on earth, somewhat less than the distance of the comet that is 500 million kilometres away from the centres of power, many thousands of people are dying from ebola, a disease that has devastated the economies and societies of several west African countries, largely due to the collapse (or non-existence) of local health services. More food for thought in considering the human cost of the imperialist world economy.

Tony Norfield, 12 November 2014

Tuesday, 28 October 2014

Hard Road

An old song just came to mind, sung by Georgia Brown as the introduction theme to a 1970s UK TV series 'Roads to Freedom', based on work by Sartre.

Here are the (French) words of the song, at least all that were sung and stayed in my memory:

"La route est dure, mais je suis fort,
Mon âme est sûr, la peur est mort,
Je sais quoi faire avec la vie,
Quand toute la terre est endurcie."

It was sung with passion, and with the French (singing) emphasis on the 'e' in 'dure', 'faire' and 'terre', and also an 'e' inflected on the end of 'sûr', to complete the rhymes. Unfortunately, not available on YouTube, or anywhere else, as far as I can see.

I hope I remember my unused French correctly, for it was a rousing, defiant song, one that is fondly remembered, despite my antipathy to existentialism.

One lesson to draw from it is that you do not have to buckle to reactionary politics, as so many do. Witness the way that the chronic capitalist crisis has fuelled anti-Moslem and anti-immigration politics. This reflects the entrenched, pro-imperialist views of the mass of people in richer countries. Pro-welfare 'socialists' and liberals, ever so progressive when times are good, bend so easily in this wind.

Tony Norfield, 28 October 2014

Sunday, 26 October 2014

Moribund Capitalism

The credit market works like this: one person's debt to another is the other person's asset. As long as the debtor can pay, then the creditor feels fine, if a little anxious when the weather changes. Now consider what happens in the wake of a credit-fuelled economic boom and its subsequent collapse. What if the mountain of debt is also a deep well of crap? That is the situation today.

This is the basic reason behind the never-ending policy from the world economy's major central banks to keep interest rates at close to zero. Every time there is a suggestion of raising interest rates (some time in the current century ...) from zero point nothing percent to zero point something, financial markets threaten to implode. Despite data in some countries recording improved profitability of capitalist companies, this is the more tangible reality of capitalist prospects.

News has not been good, in any case: from falling equity markets, to ever more desperate measures from governments and central banks, especially in Europe and the US. Below is a striking picture given for the US, by the Federal Reserve Bank of St Louis.

The chart shows the asset holdings of the US central bank, the Federal Reserve, since 2007 (the annotations are mine). In the initial phase of the crisis, the Fed boosted its lending to financial companies dramatically and did a series of rescue operations. These have now diminished to negligible proportions, as what remained of the US financial system was put back on its feet by zero interest rates and financial bail outs. However, there are two measures that have not been reversed. In fact, they have increased, even though the crisis was meant to be over: an increase in Fed holdings of US Treasury (government) securities, now totalling $2,457bn (data up to 22 October 2014), and mortgage backed securities of $1,417bn. Consider these figures against the US GDP in 2013 of $16,800bn, and also remember that the latter is just private debt to the state, not private debt to others, which is even bigger.

Many American citizens paying their mortgage interest will no doubt be somewhat surprised to learn that the recipient is actually the US government. Still, you can't keep an innovative, private capitalist system down, can you. As for the US Treasury paying interest on its bonds and notes to the US Fed, well they manage to find a way to get the money back again. The wonders of finance!

These numbers show more fully than monthly changes in business activity what is really going on, and the intractable nature of the crisis that imperialist countries face. Unfortunately, I have no such telling pictures of the European Central Bank's dodgy assets which, in any case, will soon be boosted by its new purchases of 'covered bonds'; nor of the Bank of England's activities. The Bank of England has up to now had a more conservative approach of hardly buying anything other than UK government securities in the secondary markets in its 'quantitative easing' (it has £375bn of gilts on this book and nothing else). However, the Bank of England has extended what it will accept as collateral, with the relevant 'haircuts', and also increased the ways in which it will offer 'liquidity' to the financial system in a crisis.

In summary, Lenin's description of imperialism as 'moribund capitalism' comes to mind. The astonishing application of extraordinary measures can only produce such mediocre results, ones that leave many millions in crisis.

Tony Norfield, 26 October 2014

Friday, 17 October 2014

Conference on 'How Capitalism Survives'

The journal Historical Materialism is holding its eleventh annual conference, 'How Capitalism Survives', in central London on Thursday 6 to Sunday 9 November 2014.

The venue is the School of Oriental and African Studies, the Vernon Square Campus, Penton Rise, London, WC1X 9EW. Further details regarding the conference, accommodation, etc, are found here.

It is a big conference, covering a wide range of topics! There are 13 sessions over the 4 days, each with up to 12 different discussions, usually including 3 or more speakers.

For those interested, I will be presenting in a session on 'Finance Capital, Corporations and Class'. My presentation is based on part of the research I did for my recently completed PhD and it is on 'Capitalist Power: Fictitious Capital, Corporations and Finance'. Other speakers at this particular session are Francois Chesnais, Dick Bryan, Michael Rafferty and Sune Sandbeck.

The session  on 'Finance Capital, Corporations and Class' is scheduled for Friday 7 November, from 14.15 - 16.00. *** The Room for this session has been changed, and it is now Room 221.

Tony Norfield, 17 October 2014

Tuesday, 14 October 2014

Absolute Airheads

I'm the first to admit that there are better things to rage about in the world today. But I find it difficult not to get agitated when people are asked by the British media to respond to an interviewer's point, or to say what they think about what has just been said, and they reply: 'Absolutely!'

What can this exclamation possibly mean? Do they completely agree with everything that has been said, with no reservations? Do they think that anything further could only shine a light upon the pinnacle of knowledge already revealed? Or is the word just usefully long, with all of four syllables, enabling a slow-witted respondent time to gather his or her thoughts? Probably they do not think we should disregard whether something is positive or negative, and simply pay attention to its absolute value.

In the good old days, the best stock answer to a media question was: 'There may be something in what you say'. That was of inestimable value. It allowed the respondent to (perhaps) sort of agree and please the interviewer. But it also gave the impression that other things were going on that had not been considered. After all, the world is a complicated place.

Such is the dissolution of critical culture today that this absolutely fad has absolutely taken flight, absolutely. Idiots ask idiots questions and get idiotic answers. That has been true for a long time, but the shameless revelation of this truth is now becoming an embarrassment.

What can a responsible citizen do?

I would recommend that you pay no attention to anything anyone says in a media interview after they have uttered the word 'absolutely'. More than this, disregard anything they have ever said or written. They need to be taught a lesson, and I fear that this may not be confined to the UK media.

Tony Norfield, 14 October 2014