Statement of the International Committee of the Fourth International
Part Two
I. Marx and the "iron law of wages"
One of the key propositions advanced by the Spartacists, in their defense of the trade union form of organization, is that any examination of the objective effects of the globalization of capitalist production in driving down the wages and social conditions of the working class is tantamount to adopting a "present-day version of what in the 19th century was called the 'iron law of wages.'"1
Because this forms such a vital component of their political perspective it is necessary to reveal, in some detail, the distortions and outright falsifications that they make.
The underlying thesis of the "iron law" was that any attempt by workers to increase wages by trade union or other forms of action would result in a general rise in the prices of commodities, thereby wiping out the effect of the increase in wages.
Marx took up this conception in his pamphlet Wages, Price and Profit, written in 1865 in reply to George Weston, a member of the General Council of the First International. The Spartacists never review what Marx actually wrote, nor the social and economic context in which he examined this question. Nonetheless, they charge that in analyzing the objective impact of globalized production on living standards, and the incapacity of the trade unions to sustain even the most basic interests of the working class, the International Committee has reverted to the "iron law of wages" and abandoned a "basic Marxist position."
In his address to the First International, Marx showed that the "iron law", as advanced by Weston, was based on the fallacious conception that the prices of commodities were determined and regulated by wages. While Weston's propositions were the immediate subject of Marx's analysis, his real target was the followers of Proudhon, whose politics exerted considerable influence in the French and other sections of the International.
The social base of Proudhonism consisted of the petty-bourgeois artisans and craftsmen, especially in Paris, who still worked outside the major industrial factories. The narrow outlook of this social layer was reflected in the main planks of the Proudhonist program: opposition to trade union action, opposition to political action to secure regulation by the state of working conditions, opposition to women entering the workforce, and the establishment of a people's bank.
The basic program of Proudhonism, reflecting the interests of its petty-bourgeois artisanal social base, was not the overthrow of the social relations of capitalism, but rather the removal of monopolistic constrictions on the operation of the free market, together with the provision of large amounts of cheap credit to small producers through the people's bank.
Marx regarded the defeat of the petty-bourgeois anarchist conceptions of Proudhonism as essential for the development of the workers' movement, which was being brought into being by the growth of capitalist industrialization. The Proudhonists were the political spokesmen for social forces that were being pushed back by changes in the capitalist economy.
Here there is a direct parallel with the role of the Spartacists. Like the Proudhonists, they speak for petty-bourgeois layers whose social existence is bound up with economic, social and political relations that are being undermined by vast changes in the capitalist economy.
Marx had conducted a continuous exposure of the petty-bourgeois illusions of Proudhonism since writing the Poverty of Philosophy in 1847. At the time of his reply to the Proudhonist conceptions of Weston, he had made one of his most important discoveries: the origins of surplus value, which revealed how it was that the exploitation of the working class necessarily arose out of the very operation of the market.
The value of any commodity, he explained, was determined by the amount of socially necessary labor contained within it, that is, by the time taken on average to produce it. What was commonly considered the value of labor was, in fact, the value of labor power, the capacity of the laborer to work. Like any other commodity, its value was determined by the quantity of labor needed to reproduce it. In other words, the value of labor power was the value of the commodities needed to sustain the worker and his family.
The origin of surplus value, Marx explained, lay in the fact that the value of labor power was vastly different from the value which the worker added in the course of the working day. Whereas the average amount of necessaries to sustain the laborer and his family might require six hours for their production, the laborer engaged in 12 hours of work for the capitalist. This difference formed the basis of the unpaid labor or surplus value extracted from the worker in the course of the working day.
On the basis of this analysis, Marx explained that an increase in wages would not bring about a general increase in commodity prices. Rather, it would alter the distribution of the social produce between profits and wages. Consequently, between the maximum level of profits (determined by the minimum wage level) and the minimum level of profits "an immense scale of variations is possible". The actual level of wages at any point in time is determined by the continuous struggle between capital and labor, with the matter resolving itself "into a question of the respective powers of the combatants."
This is the point at which the Spartacists leave off their presentation of the issue, in order to introduce their falsifications. Having presented the iron law of wages as "a doctrine that wages could not be permanently raised above a fixed level regardless of the actions -- economic and/or political -- taken by the working class", the Spartacists imply that Marx stated the opposite.
In fact, as Marx makes clear at the outset, he hopes that Weston "will find me agreeing with what appears to me the just idea lying at the bottom of his theses". This "just idea" is that, in the long run, the economic and political action of the working class cannot permanently raise the level of wages, irrespective of objective economic conditions.
Having shown that the struggle over wages comes down to a question of the strength of the combatants, Marx then points to the processes which determine its outcome. He points out, in opposition to Weston, that farmers, for example, faced with an increase in the wages of agricultural laborers, were not able to increase the price of corn and had to submit to its fall. They countered the rise in wages not by increasing prices, but through the introduction of machinery and more scientific methods. They thereby diminished the demand for labor by increasing its productive power, and made the agricultural population again "relatively redundant."
"This is the general method in which a reaction, quicker or slower, of capital against a rise of wages takes place in the old settled countries. Ricardo has justly remarked that machinery is in constant competition with labor, and can often be only introduced when the price of labor has reached a certain height, but the appliance of machinery is but one of the many methods for increasing the productive powers of labor. This very same development which makes common labor relatively redundant simplifies on the other hand skilled labor and thus depreciates it."2
Marx went on to explain that, in the course of development of industry, the growth of capital far outpaced the growth of demand for labor and that, while the demand for labor increases, it will only "increase in a constantly diminishing ratio as compared with the increase of capital."
The Spartacists attempt to invoke Marx as a supporter of their reformist thesis that through trade union action the working class is able to secure a permanent increase in wages and living standards. In fact, Marx draws the opposite conclusions. Having pointed to the reaction of capital to an increase in wages, he writes:
"These few hints will suffice to show that the very development of modern industry must progressively turn the scale in favor of the capitalist against the working man, and consequently the general tendency of capitalist production is not to raise but to sink the average standard of wages, or push the value of labor more or less to its minimum limit."3
Having drawn out the main tendency of development, Marx then made clear that this by no means implied that workers should renounce resistance against the encroachments of capital or "abandon their attempts at making the best of the occasional chances for their temporary improvement."
But, Marx insisted: "[T]he working class ought not to exaggerate to themselves the ultimate working of these everyday struggles. They ought not to forget that they are fighting with effects, but not with the causes of those effects; that they are retarding the downward movement, but not changing its direction; that they are applying palliatives, not curing the malady. They ought, therefore, not to be exclusively absorbed in these unavoidable guerrilla fights incessantly springing up from the never-ceasing encroachments of capital or changes of the market. They ought to understand that, with all the miseries it imposes upon them, the present system simultaneously engenders the material conditions and the social forms necessary for an economical reconstruction of society. Instead of the conservative motto, 'A fair day's wage for a fair day's work!' they ought to inscribe on their banner the revolutionary watchword, 'Abolition of the wages system!'"4
The Spartacists attempt to base their indictment of the International Committee on one of the conclusions drawn by Marx from his analysis.
"Trade unions work well as centers of resistance against the encroachments of capital ... They fail generally from limiting themselves to a guerrilla war against the effects of the existing system, instead of trying to change it, instead of using their organized forces as a lever for the final emancipation of the working class, that is to say, the ultimate abolition of the wages system."
According to the Spartacists: "The Northites now openly repudiate this basic Marxist position. They maintain that trade unions can no longer function as centers of resistance to the predations of capital, and they counterpose a socialist transformation to the defense of workers' interests within capitalism."5
The thesis that "trade unions work well as centers of resistance against the encroachments of capital" is not some kind of "basic Marxist proposition." It was a conditional assessment by Marx at a definite point in time -- the mid 1860s -- when trade unions were only just beginning to make their appearance in a number of countries. It was an assessment made at a definite historical stage in the development of capitalism, not some kind of absolute pronouncement. But even as he emphasized the importance of the unions, Marx pointed to their inherent limitations.
Already, by the end of the 19th century, those limitations were coming to the fore and were being analyzed by the most prominent Marxists of the day, while by the end of the 1930s, Trotsky pointed to the growing tendency of the unions to become incorporated into the apparatus of the capitalist state -- a tendency that accelerated greatly during World War II and during the post-war boom, when the trade unions functioned as co-administrators of the social welfare state.
However, when the postwar boom came to an end in the mid-1970s, and capital changed its orientation from one of limited concessions to the working class to never-ending reductions in real wages and working conditions, the trade unions, far from "working well", proved completely incapable of resisting capital's encroachments. The record in all the major capitalist countries is the same over the past two decades: real wages have declined, the working class has suffered a series of defeats, and conditions won in an earlier period have been severely cut back.
Not only have real wages been reduced, but social welfare provisions are being cut back in all the major capitalist countries as a direct consequence of the globalization of production. The bourgeoisie is now able to relocate different sections of the production process, not only to take advantage of lower wages, but to minimize taxation payments. The capitalist nation states are consequently in a competition with one another to attract transnational corporations to their territory by reducing tax and other payments. Furthermore, the globalization of finance means that even where corporations are required to pay tax, they can avoid most of it.
A recent report by the Australian Tax Office, for example, concluded that multinational companies, both domestic and foreign-based, paid virtually no company tax at all.
The pressure for lower wages comes not only from traditional low-cost areas. As one recent study concludes: " ... the alignment of labor conditions across countries does not take place only because of competition from low-cost areas: it also forces Europe, America and Japan to converge. The pressures towards greater flexibility of the labor market and toward the reversal of the welfare state in Western Europe come less from the pressures derived from East Asia than from competition with the United States. It will become increasingly difficult for Japanese firms to continue life employment practices for the privileged 30 percent of its labor force if they have to compete in an open economy with American competitors practicing flexible employment."6
II. The rejection of a revolutionary perspective
Apart from being refuted by empirical facts, the Spartacist thesis that trade unions "work well" as centers of resistance to the demands of capital raises issues of long-term historical perspective. If, as the Spartacists maintain, there is no objective reason why the trade unions cannot continuously carry forward the interests of the working class against the predations of capitalism and maintain the "defense of the workers' interests within capitalism", then there is clearly no objective necessity for the overthrow of capitalism.
There is no material necessity for the working class to advance the struggle for socialism, because its material interests can be met within the framework of the profit system by trade unions that "work well" provided their leadership is sufficiently militant. Consequently, the socialist revolution is not an objective material necessity, but merely an idea or a utopia. The revolutionary party is not the necessary instrument through which the working class emancipates itself; it is, at most, a propaganda society for this utopia.
In other words, the Spartacist denunciation of the International Committee is a regurgitation of the same arguments thrown forward by every union bureaucrat since the formation of the unions: the defense of the immediate material interests of the working class requires nothing more than the trade unions.
The deep-seated hostility of the Spartacists to the socialist revolution emerges clearly in their objections to the following passage from an article by Nick Beams, which explained the connection between the immediate struggles of the working class and the socialist program:
"In order to defend even the most minimal conditions -- the simple and most ordinary demands -- the working class is confronted with the necessity of overthrowing the social relations based on capital and wage labor determined by the capitalist market through which the appropriation of surplus value takes place."
The Spartacists object: "At first glance, this may seem like a terribly revolutionary position. In fact, it indicates a defeatist and abstentionist attitude toward the actual struggles of the working class, without which all talk of overthrowing the social relations based on capital and wage labor is empty rhetoric."7
This counterposing of the "actual struggles" of the working class to the struggle for a socialist perspective is the hallmark of every opportunist tendency and has been the stock-in-trade of the reformist and trade union bureaucracy throughout this century, and well before.
The position advanced by Beams -- that the defense of the most minimal conditions of the working class raises the necessity for the struggle for a program aimed at the conquest of political power -- does not imply an abstention from the struggles erupting in the working class. Rather it indicates, and this is where the objections of the Spartacists arise, what must be the attitude of Marxists towards those struggles -- the necessity for the working class to break out of the stranglehold of the trade union bureaucracy, which seeks to subordinate it to the rule of capital.
The International Committee raises before the working class the new tasks with which it is confronted as the result of changed objective conditions. The real practitioners of abstentionism and capitulation are those who maintain that the working class can simply continue as before, when clearly the entire situation has been transformed. Not only are there no further concessions, the bourgeoisie is striving to claw back all the concessions it was forced to make in the past. This means that there can be no actual struggle to defend the conditions of the working class outside of a political struggle, which aims at the conquest of political power. The working class cannot defend anything unless it challenges everything, that is, the domination of capital and its drive for profit over the whole of society.
The attitude of the International Committee to the "actual struggles" of the working class is based on the program of Marxists throughout this century. When the opportunists of the Bernstein school sought to separate the "actual struggles" of the working class for improved wages and working conditions from the overthrow of capitalism and the socialist revolution, Luxemburg replied that reforms were, in every sense, a by-product of revolution, either of past revolutionary struggles, or of an ongoing revolutionary movement.
In the 1930s, in his critique of the program of the French Communist Party, Trotsky directly addressed the separation of the immediate demands of the working class from the struggle for political power.
The program was crowned, he pointed out, by the following statement: "While fighting every day in order to relieve the toiling masses from the misery which the capitalist regime imposes on them, the Communists emphasize that final emancipation can be gained only by the abolition of the capitalist regime and the setting up of the Dictatorship of the Proletariat."8
This formula, which was invoked by the Social Democracy half a century before, had become obsolete by the time of World War I, but was now being employed by the Stalinists in the name of Marx and Lenin.
"When they 'emphasize' that 'the final emancipation' can be obtained only by the abolition of the capitalist regime, they manipulate this elementary truth in order to deceive the workers. For they give the workers the idea that a certain alleviation, even an important alleviation in their condition, can be obtained within the framework of the present regime."9
The present-day Spartacists repeat almost word for word the positions of the Stalinists more than 60 years ago. They admit that, of course, the final emancipation of the working class requires the overthrow of capitalism, and that a revolutionary party, not a trade union, is necessary for that task. But the socialist program is consigned to the indefinite and cloudy future and has no bearing on the "actual struggles" of the working class, for these involve "the defense of the workers' interests within capitalism" by means of the trade unions.
In opposition to the Stalinists, Trotsky explained: "The Marxist political thesis must be the following: 'While explaining constantly to the masses that rotting capitalism has no place either for the alleviation of their situation or even for the maintenance of their customary level of misery, while putting openly before the masses the task of the social revolution as the immediate task of our day, while mobilizing the workers for the conquest of power, while defending the workers' organizations with the help of the workers' militia -- the communists (or the socialists) will at the same time lose no opportunity to snatch this or that partial concession from the enemy, or at least to prevent the further lowering of the living standard of the workers.'"10
This approach was further developed by Trotsky in the Transitional Program, the founding document of the Fourth International, written in 1938.
"The Fourth International," Trotsky explained, "does not discard the program of the old 'minimal' demands to the degree to which these have preserved at least part of their forcefulness. Indefatigably, it defends the democratic rights and social conquests of the workers. But it carries on this day-to-day work within the framework of the correct actual, that is, revolutionary perspective. Insofar as the old partial, 'minimal' demands of the masses clash with the destructive and degrading tendencies of decadent capitalism -- and this occurs at each step -- the Fourth International advances a system of transitional demands, the essence of which is contained in the fact that ever more openly and decisively they will be directed against the very bases of the bourgeois regime. The old 'minimal' program' is superseded by the transitional program, the task of which lies in the systematic mobilization of the masses for the proletarian revolution."11
III. A separation
of immediate demands
from the struggle for socialism
With the restabilization of world capitalism in the immediate postwar period and the subsequent 25-year boom, the defense of the past gains of the working class, and the advancement of new ones, was, to a great extent, separated from the struggle for political power. Capitalist expansion saw a revival of the discredited thesis of social reformism and opportunism, and their insistence that the "actual struggles" of the working class could never transcend the framework of capitalism.
The expansion of capitalism in the postwar boom meant that there was, so to speak, an objective gap between the immediate demands of the working class and the political struggle for its long-term interests. The International Committee and its sections fought, throughout this period, to bridge this gap through the struggle to mobilize the working class around the demand that its leadership break its ties with the bourgeoisie and undertake the fight for a socialist program.
Under conditions in which material gains could be made through trade union struggles, masses of workers gave their allegiance to the social democratic and trade union leaders. The International Committee fought to break the misplaced confidence in these leaderships by bringing the working class into a political struggle against them. Large sections of the petty-bourgeois radicals denounced this tactical initiative, none more vociferously than the Spartacists. Their opposition then, as now, was to the mobilization of the working class on an independent program against the labor bureaucracy.
While the working class was able to make certain material gains on the basis of militant trade union struggles, the post-war experience by no means refutes the Marxist thesis on the relationship between reform and revolution. It has been vindicated both positively and negatively. The immediate advances in the social position of the working class, in the aftermath of the war, were a direct expression of the fear of the bourgeoisie that if concessions were not made, they would face revolutionary struggles. To be sure, the bourgeoisie was able to rely directly upon the social democratic and Stalinist leaderships, who were committed to the post-war restoration of capitalist order. But had the conditions of the 1930s returned, there would have been a significant and rapid shift of the masses to the left.
The other period of major social advance -- from the end of the 1960s to the first years of the 1970s -- was likewise the outcome of the potentially revolutionary struggles, stretching from the May-June 1968 events in France, to the bringing down of the Heath Tory government by the British miners in 1974.
And the Marxist thesis has received a no less powerful negative confirmation. It was precisely the separation of the struggles for its immediate interests from a socialist political perspective that left the working class unprepared for the global offensive undertaken by the bourgeoisie over the past two decades.
The essential argument that the Spartacists advance against the International Committee is one of the standard refrains of social democrats, Stalinists and opportunists of every stripe, i.e., that to tell the working class it can defend its interests only on the basis of a revolutionary program is to sow defeatism. The unspoken assumption behind this argument is the demoralized view that the working class can never achieve the degree of political consciousness and organization necessary to overthrow capitalism, thus the perspective of socialist revolution is unviable.
Spartacist's position can be reduced to the following line of argument: The trade unions are the only legitimate form of working class organization. Their traditional program of applying pressure on the bourgeoisie is the only viable program. If these organizations and this program are no longer capable of defending the working class, then all is lost. Either one accepts the present, reformist level of political consciousness in the working class, and the organizations that uphold that consciousness, or one abandons any form of struggle.
IV. Spartacist denies the fall in living standards
In their defense of the viability of trade unionism, the Spartacists go to the most absurd lengths, denying the social reality of declining living standards.
The 1993 perspectives resolution of the Workers League, The Globalization of Capitalist Production and the International Tasks of the Working Class, explained that, with the shifting of production to countries with wages a fraction of those in the advanced capitalist nations, there was an inexorable "downward leveling of wages and living standards and a relentless assault on past social reforms and legal limitations on the exploitation of labor by capital in the imperialist centers."
According to the Spartacists, however, merely by pointing to this undeniable process "the Northites are here advancing, with a thin veneer of Marxist rhetoric, an argument propounded by a wide range of bourgeois and petty-bourgeois liberals." In other words, because this tendency has been noted by a number of bourgeois economists and journalists motivated by concerns for the stability of capitalist rule, its existence must be denied.
On the basis of this ridiculous argument one might just as well conclude that the whole of Lenin's work Imperialism should be discarded because he drew heavily on the work of the social liberal Hobson, not to speak of other bourgeois economists and journalists of his day.
The passage to which the Spartacists object is not, of itself, a political perspective, but simply a statement of economic fact based on the operations of the capitalist market. If capital is able to purchase commodities in one market more cheaply than in others -- and the labor power of the working class, skilled and unskilled, is most assuredly a commodity -- then the price of that commodity in all other markets will tend to fall.
In essence, the Spartacists' denunciation of the International Committee amounts to a denial of the most basic historical tendencies of the capitalist mode of production. As Marx revealed, what distinguished capitalism from all previous modes of social production was its tendency to become all-embracing, to extend to every corner of the globe, and to create a world market. This inherent tendency is bound up with the incessant striving by capital to increase the extraction of surplus value from the working class.
The Spartacists' thesis now emerges clearly: while there is a general tendency for capital to create a world market, this applies to every commodity save one, labor power. Capital strives to break down every barrier and remove every limitation on its activity -- the accumulation of surplus value -- but stops at one: the market for labor power remains constricted within the nation-state.
The process of globalized production has been characterized by two interconnected tendencies in the labor market: the increasing ability of capital to purchase labor power in any part of the globe, and the vast increase in the global supply of labor power. It is estimated that the world supply of labor will increase by around 1 billion over the next decade. The massive destruction of the peasantry through the operations of global capital has created an unprecedented situation: for the first time in human history the proletariat, the class with nothing to sell but its labor power, constitutes the majority of the world's population.
While opposing the advocates of the "iron law of wages", Marx pointed to inexorable tendencies, within the process of capitalist production, which worked to drive down the price of labor power, i.e., wages. Above all, the continuous advancement of the productive forces and the development of new technologies worsened the position of the working class by reducing the demand for labor and increasing its supply.
This has been precisely the impact of computerization and the automation of production processes over the past two decades. The technological transformation of entire production processes has made possible the elimination of vast amounts of labor, while at the same time enabling production processes to be integrated across vast distances, thereby allowing capital to shift high-labor operations to low-wage regions.
According to the Spartacists, however, these processes, which have transformed production and the lives of millions of people, are nothing more than the illusory products of a propaganda campaign.
"'Globalization'", they write, " is but a new variation on an old theme. In the 1950s and early '60s, the term 'automation' was invested with the same apocalyptic, earth-shaking consequences. Liberal intellectuals predicted that the industrial working class would in large part be replaced by robots and other machinery. One conclusion was that trade unions were becoming or would become obsolete."12
It would be difficult to find a clearer expression of the indifference of the middle class radicals to the fate of millions of working people. Over the past two decades, the lives of hundreds of millions of workers -- blue collar and white collar alike -- have been transformed by the introduction of computerized, automated methods of production and information processing, leading to a vast destruction of jobs.
One does not have to subscribe to the predictions of bourgeois commentators that robots will replace the working class to recognize the far-reaching changes automation has introduced into the work place, and the abject failure of the unions to defend workers against its short-term impact, or provide the working class with a means for harnessing these changes to its longer-term benefit. It is an undeniable fact that young unskilled and semi-skilled workers today have far less chance of obtaining a secure, decent-paying job in auto, the mines and many other industries than did their fathers or grandfathers, and that this is due, in large measure, to the introduction of robotics and other automated techniques.
Spartacist dismisses automation, just as it discounts globalization, in order to boost illusions in the trade unions, which are incapable of confronting either phenomenon in a way that accords with the interests of the working class.
V. Economic nationalism and American chauvinism
According to the Spartacists: "Wages in the advanced capitalist countries are not going to be driven down to anything close to Third World levels for two reasons: one political, the other economic."13
The political reason centers on the claim that the various imperialist powers will not permit the shift of capital to take place to such an extent that military capacities are endangered and that at a certain point they will impose tariff and other restrictions on the movement of capital.
"In the next few years, the US, Germany and Japan may well impose -- against the immediate interests and desires of sections of their own capitalist classes -- high levels of trade protectionism, controls of foreign exchange transactions and strict limits on the inflow and outflow of capital."14
Let us for a moment take the Spartacists' assertions at face value. There is an ultimate floor on wage levels in the advanced capitalist countries, they argue, because at a certain point the imperialist powers will invoke measures to restrict the movement of capital around the world. Consequently, it will be possible for the trade unions to exert pressure (provided their leadership is sufficiently willing to play "hardball") on the national bourgeoisie and carry out their designated task of the "defense of the workers' interests within capitalism." Once again, all will be for the best, and the necessity for social revolution will have been averted.
Now let us come back to reality and consider for a moment the consequences of the actions the Spartacists maintain will protect real wages. Such is the integration of the world economy that tariff and other protective measures would not only disrupt world trade, with a repeat of the disastrous consequences of the 1930s. They would also bring about a severe dislocation of the production processes of major corporations, which no longer operate national-based factories and processes, but integrate different aspects of production on a world scale. The introduction of such tariffs, combined with restrictions on the flow of capital, would bring about a financial and industrial collapse of staggering proportions.
This is not a matter of conjecture. Its outlines have already been made clearly visible. In 1995, for example, the trade war between the US and Japan, in which the Clinton administration threatened restrictive tariffs on imports of cars, resulted in a truce when the Japanese authorities threatened that such measures would provoke a withdrawal of the financial inflows holding up the American stock and bond markets.
Not only would the measures envisaged by the Spartacists bring about a financial collapse, they would create the conditions for a new inter-imperialist war, as each imperialist power sought to expand its position at the expense of its rivals.
In other words, the very political measures that the Spartacists insist will ensure the maintenance of relatively high wages in the advanced capitalist countries would, if enacted, bring about a breakdown of the world capitalist economy, leading inexorably to another war.
While the Spartacists' arguments might appear at first sight to be a kind of madness, they reveal a social logic and method. As Lenin and other Marxists explained in the first part of this century, the material basis for the formation of a privileged labor aristocracy and trade union bureaucracy in the advanced capitalist countries lay in the super-profits extracted by the imperialist powers from the colonies and backward capitalist nations. This is the social layer for whom the Spartacists speak -- a layer that will demand tariff protection, financial regulation by the national state and ultimately military action with the claim that this is necessary to protect wages, living standards and "our way of life."
The same social outlook is revealed in the economic arguments advanced by the Spartacists in support of their "wages floor" thesis. Major firms, they insist, will continue to use more expensive labor in the advanced capitalist countries "because 15 unskilled workers in Indonesia (earning well under a dollar an hour) cannot replace a skilled machinist in the US (earning $15 an hour) or Germany (earning $25 an hour) in the process of industrial production."15
Once again the unrestrained chauvinism, so characteristic of the bureaucratic layers for whom the Spartacists speak, comes bursting forth. It never occurs to them that there are skilled workers in Indonesia, India, China and elsewhere. Skilled workers only inhabit the advanced capitalist countries.
The issue is not the replacement of a $15 per hour machinist in the US with 15 workers in Indonesia paid $1 per hour or less, but the replacement of a machinist in the US with one in China or Indonesia, or in the case of Germany, with a machinist in Czechoslovakia or Poland, Spain or Russia, paid at a much lower rate.
In the past, when technical considerations required that entire production processes had to be carried out in one center, the location of these industries, was to a great extent, determined by the location of skilled labor and backup facilities for capital equipment. But skilled labor can be developed in any part of the globe. There is now an international market not only for unskilled labor, but skilled workers as well. A computer programmer in the US is thrown into competition with a computer programmer in Bangalore, an American machinist with a machinist in China or India.
Apart from revealing their utterly chauvinist outlook, the economic arguments of the Spartacists make clear their indifference to the vast mass of workers in the advanced capitalist countries who are earning nothing like $15 and $25 per hour. In fact, wages have fallen so low that manufacturers in the advanced capitalist countries have found that they no longer have to venture overseas to find "Third World" conditions -- they exist at home.
VI. Globalized production and proletarian internationalism
The eagerness with which the Spartacists advance both their political and economic arguments for a wages floor, expresses their ingrained hostility to a revolutionary perspective. In sum, the arguments of the Spartacists amount to nothing less than a call for the maintenance of the social and economic conditions that have formed such a crucial prop for the bourgeoisie.
In the past, under the previous regime of national, as opposed to globalized production, the wages and living standards of workers were determined, not merely by the type of labor they performed, but also by the country in which they lived. That is, living standards and social conditions were determined not only by class, but by nationality, and it was this material factor which played such a crucial role in enabling the bourgeoisie, in collaboration with the reformist and Stalinist parties, to block the development of a genuine socialist and internationalist outlook in the working class.
There was some basis, from the standpoint of the short-term, immediate interests of workers, for the claim that what was good for General Motors was good for the American worker, or the Holden worker in Australia, or the Opel worker in Germany, and consequently a material foundation for an appeal to nationalism.
This situation has changed irrevocably. The conditions of the working class in one country are now more and more directly connected to the social position of the working class throughout the world. The globalization of production has created unprecedented material conditions for the development of genuine internationalism, not as some kind of external solidarity between nationally-based working classes, but as the mode of struggle of one global working class. This is the objective basis for the perspective of the International Committee -- the construction of the world party of socialist revolution as the organizing center of the world proletariat.
If the Spartacists and other petty-bourgeois radicals are so desperate to maintain the fiction that globalization has changed nothing, it is because they instinctively recognize that it has shattered the foundations of their own nationalist and opportunist politics.
The Spartacist League's chauvinist arguments on wages are crowned by an attempt to provide a theoretical rationale for the whole exercise, by referring to Trotsky's theory of permanent revolution.
"The Northite notion of 'globalization'," they write, "is in its theoretical essence a repudiation of the Trotskyist understanding of permanent revolution because it posits a tendency to equalize economic conditions throughout the world by leveling up productivity in the backward countries and leveling down productivity in the advanced ones."16
In the first place there is a complete jumbling of the processes involved in the global movement of productive capital. According to the Spartacists, to point to the tendency for the equalization of wages is to make an assertion that productivity is falling in the advanced capitalist countries and rising in the backward countries. The reality is that wage rates are not directly and mechanically related to productivity, as anyone who has the slightest familiarity with Marxist political economy can demonstrate. The wage rates paid to workers in any section of industry, whether skilled or unskilled, are not determined by their output, but by the value of their labor power. If skilled workers are more highly paid than unskilled workers, it is not because they are more productive, but because it takes longer to produce them -- considerable time is spent in training and education -- and the value of the labor power, around which their wage levels fluctuate in the market, is higher.
The tendency for the equalization of wages does not arise because of movements in productivity -- in both the advanced capitalist countries and the backward countries alike the productivity of labor is rising -- but from the increased supply of labor. Productive capital now has at its disposal vast quantities of labor which previously, for all practical purposes, were beyond its reach.
The claim that globalization implies a tendency to equalize economic conditions and thereby contradicts the theory of permanent revolution is answered quite clearly by Trotsky himself.
"In contrast to the economic systems which preceded it, capitalism inherently and constantly aims at economic expansion, at the penetration of new territories, the surmounting of economic differences, the conversion of self-sufficient and provincial national economies into a system of financial interrelationships. Thereby it brings about their rapprochement and equalizes the economic and cultural levels of the most progressive and the most backward countries. Without this main process, it would be impossible to conceive of the relative leveling out, first, of Europe with Great Britain, and then, of America with Europe; the industrialization of the colonies, the diminishing gap between India and Great Britain, and all the consequences arising from the enumerated processes upon which is based not only the program of the Communist International but also its very existence."17
These lines were written against the Stalinists who invoked "uneven development" to bolster their nationalist perspective of "socialism in one country." They apply no less forcefully to the Spartacists, who invoke "uneven development" in order to justify their assertion that the working class can still advance its interests within the framework of capitalism, provided its leadership is sufficiently militant. In other words, uneven development is now invoked as the basis for a theory of social reformism in one country, or group of countries, or, more accurately, for a particular and increasingly narrow and privileged section of the working class in one country or group of countries.
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