The capitalist illusion Part 3: Poverty thriving

Over two issues of Socialist Voice (January and March 2018) there were two articles that explained the capitalist illusion that perpetuates the class division in society.

A great deception has allowed a tiny minority of the world’s population to own and control the vast majority of wealth that is created, while billions of people live in misery, squalor, and sprawling poverty. To maintain the illusion, the perpetrators create a belief system that has at its core the acceptance of privileged wealth, which comes in the form of profits, rents, and interest, deriving from a so-called “natural law” of private ownership of industry, land, and property, i.e. the private ownership of the means of production.

This commonly held belief has been maintained within the present era, that of the capitalist (i.e. private) mode of production, where primary (raw materials), secondary (industry) and tertiary (services) production are predominantly owned, run and controlled by private individuals or corporations.

This mode is antagonistic, in that one part of society, the owners, has separate and conflicting interests from the rest of society, those who earn their living and maintain a household through their labour, because within capitalism the wealth that is accumulated by either capital or labour is at the expense of the other. Capitalists can increase profits only by extracting and exploiting more from labour, while labour, within capitalism, can increase its wealth only at the expense of capital.

The previous two articles explained this in detail. This article will deal more with the whole process at the international level, because quite often left and so-called Marxist thinkers, parties and movements confine themselves to the national view and so often echo imperialist propaganda.

Social-democratic and ultra-left movements often have good intentions, agreeable national programmes, and sizeable numbers; but one of their biggest weaknesses lies in foreign policy, where the dominant developed countries dictate the fate of the underdeveloped countries. Ultimately, social democrats and reformists lack the analysis that would provide for a lasting and fundamental shift in the mode of production, i.e. from capitalist (private) to socialist (public) ownership of the means of production, because they lack a complete analysis of capitalism at its highest stage: imperialism.

Having looked previously at the exchange of non-equivalents that takes place between a worker and their employer, I think it would be well to remember that the exchange of equivalents must not be confined to the relationship between the labourer and the capitalist in a particular country but must be extended to exchanges between countries, between developed and underdeveloped countries, core and periphery, or the global north and global south.

In other words, it is hypocritical to fight for justice, equality, democracy or a fairer distribution of wealth at home if we are happy to exploit, plunder and ravage the peoples of other nations.
Ignoring the uneven and maldevelopment of nations is just another element of the capitalist illusion, one that hides the cruelty of the barbaric capitalist system.

Take, for example, three raw products: the cocoa bean, the coffee bean, and the banana. The most labour-intensive process in the supply chain of these commodities, where millions of people are employed, is the actual growing, harvesting, collecting and packaging for export.

This whole process repeats itself, generation after generation, as the hundreds of millions of global agricultural labourers are kept at subsistence pay levels, where their national production facilities and techniques, their pay, terms and conditions are never given the space or the capacity to develop. The agricultural workers of the world are totally at the mercy of the large manufacturers and retail monopolies, which not only want but must keep them impoverished!

The injustice is most striking when we see developed countries receiving more in the form of the VAT paid on the goods than the total agricultural work force of the underdeveloped countries receives for the commodity itself. However, these transnational corporations, big and powerful though they are, still operate under national and international rules and regulations that are agreed and negotiated by individual states.
The post-war construction of capitalist welfare states after 1945, despite the gains for the working class of those countries, developed against the backdrop of aggressive and ruthless foreign policies for maintaining access, extraction and control of global resources.

Free education, health services, housing, welfare, access to credit, and cheap commodities, such as clothes, readily available imported foods and energy resources, were able to keep these problems at bay for the working class of the global north but at the expense of our fellow-humans who have suffered the cruel fate of being born into a system where poverty must be reproduced.

John Smith, author of Imperialism in the 21st Century, writes in a recent article: “When in 2018 the British state collects, in VAT and other taxes, up to half the final sale price of a shirt made in Bangladesh (while the woman who made the shirt is paid a tiny fraction of this amount) and uses these tax receipts to finance the National Health Service and workers’ pensions (neither of which are available to our Bangladeshi sisters, nor to the 260 million migrant workers from China’s countryside who toil in that country’s export-oriented factories), is it acceptable for Marxists to ignore such inconvenient ‘realities on the ground’?”

This is sometimes a hard pill to swallow, especially for those on the left: to think that through all the struggles and sacrifices the working class has gone through, and all the gains that have been won over the past century, they have been won at the expense of other peoples, so maintaining the continued impoverishment and underdevelopment of countries of the global south.

To deny or to ignore this fact is to prolong the misery of our fellow-humans who languish under the diktats of foreign policy makers and their capitalist paymasters. So long as the capitalist relations of production and distribution exist, no matter how social-democratic a government might be, the gross exploitation of man by man will continue.

If we return to the cocoa, coffee and banana industries, which have a multi-billion annual income, the agricultural labourer performs the productive processing task of turning the raw seed, pod or fruit into an exportable product. Every other task, such as roasting the coffee, for example, is more capital-intensive (more mechanised), and so generally takes place in the factories of Europe and North America. With a higher ratio of capital to labour, therefore, and higher rates of pay, lower rates of profit will be available, so the super-profits are extracted from the bulk of the workers in the global south.

This is because all wealth is created by labour at the point of production: it takes its money form at the point of exchange, at which stage the capitalists’ exploitation of the labourer has already taken place through the wage payment system.

To maintain their dominance, foreign policy and trade deals ensure that the country where the product is grown does not reap the large rewards available for the finished product. This would be against capitalist interests, because only by keeping other countries down are they able to stay up.

This is the capitalist system: it is driven and expanded by exploitation. If countries such as Ivory Coast, which grows approximately 38 per cent of the world’s chocolate, were able to develop thriving indigenous industries around the cocoa bean, they would be a direct threat to the big monopoly firms and the chocolate-making plants of the west.

If you extend this to every other raw material or resource, such as oil, gold, copper, and wood, that is extracted from regions of the global south and profited by in the global north, and add to this the loss of jobs that could result, you begin to realise the implications this would have not only for the corporations, the monopolies and capitalists but also for the working class and its organisations—trade unions, political parties, lobbying groups, etc.—in the global north.

The contradictions of capitalism throw up huge challenges to the working class of all nations; but we must always keep in mind that in order to maintain a system whose working dynamics include one part being the exploiters and the other the exploited, the inevitable conclusion is that in order for the capitalist system to survive, mass poverty has to thrive.

A case in point is how the European Union makes it impossible for African countries to trade their way out of poverty. The EU’s common agricultural policy facilitates the dumping of subsidised EU agricultural products in African markets at a price lower than the African country’s farmers can sell it at. This means that the local farmers frequently operate at a loss, forcing them to go out of business.

Compounded with this are the high tariffs on African agricultural products that are imported, which strangles trade.

This cycle then forces those countries to seek loans from the International Monetary Fund and the World Bank, compelling them to remove their own tariffs and subsidies and to favour foreign direct investment, instead of building indigenous industry, as part of the imposed free-trade rules, thus reinforcing the inability of underdeveloped countries to enter into a stage of development, continuing the cycle of poverty.

The final word on how ruthless this system is requires looking at the countries that have tried to break free of the yoke of this imperialist domination. Any state or movement that has sought an independent path—not necessarily a socialist path—that was not in line with the imperialist agenda has suffered major consequences. The invasion or overthrow of governments in Iraq, Afghanistan and Libya and the failed (so far) attempt in Syria are the most recent chapters of a strategy of destabilisation of global regions.

In the post-war era and its anti-colonial and independence movements, it wasn’t the United States, Britain or France that promoted and supported them: on the contrary, they propped up or put into power despots and dictators while at the same time sabotaging and murdering the leaders and followers of liberation movements, on all continents, including their perceived enemies within.

Against the backdrop of the Cold War and beyond, the United States, with the help of its British and European allies in many instances, intervened in areas all around the globe. The list includes:
• China, 1945–46
• Syria, 1949
• Korea, 1950–53
• China again, 1950–53
• Iran, 1953
• Guatemala, 1954
• Tibet, 1955–1970s
• Indonesia, 1958
• Cuba, 1959
• Democratic Republic of Congo, 1960–65
• Iraq, 1960–63
• Dominican Republic, 1961
• Viet Nam, 1961–1973
• Brazil, 1964
• Belgian Congo, 1964
• Guatemala again, 1964
• Laos, 1964–1973
• Dominican Republic again, 1965–66
• Peru, 1965
• Greece, 1967
• Guatemala again, 1967–69
• Cambodia, 1969–1970
• Chile, 1970–73
• Argentina, 1976
• Turkey, 1980
• Poland, 1980–81
• El Salvador, 1981–1992
• Nicaragua, 1981–1990
• Cambodia again, 1980–1995
• Angola, 1980
• Lebanon, 1982–84
• Grenada, 1983–84
• Philippines, 1986
• Libya, 1986
• Iran, 1987–88
• Libya again, 1989
• Panama, 1989–1990
• Iraq again, 1991
• Kuwait, 1991
• Somalia, 1992–94
• Iraq again, 1992–96
• Bosnia, 1995
• Iran again, 1998
• Sudan, 1998
• Afghanistan, 1998
• Serbia, 1999
• Afghanistan again, 2001
• Iraq again, 2002–03
• Somalia, 2006–07
• Iran again, 2005 to the present
• Libya again, 2011
• Syria again, 2013 to the present

This is not to mention the continuing British occupation of Ireland, support for the nationalist-fascist coup in Ukraine, the constant threats and coup attempts in Venezuela, the war on Yemen by the imperialists’ ally Saudi Arabia, the 58-year blockade of socialist Cuba, or the support and subsidising of the Israeli apartheid regime.

It is a legacy of brutality that prevails to this day, which is why we cannot ignore it any further.
Foreign policy and foreign trade are not a partisan issue but a class issue. The dominant capitalist class drives and directs state policies in the interests of imperialism, which stunts countries and prevents them from developing. They economically punish non-compliance, and they bomb and invade outright defiance. The human cost of these policies matters not if the reward can be reaped.

It is a vulgar time we live in, and so many people, including leftist and anti-capitalist movements, have been duped by imperialist propaganda, some even going so far as to echo the propaganda of imperialism.
We cannot allow these organisations, whether they be labelled left or right, to perpetuate the capitalist illusion and imperialist plunder. Our analysis and message must be clear: capitalism survives so long as mass poverty thrives.