C

CABLE
TECHNOLOGY

U THE UNITED KINGDOM'S Conservative

Government designated 1982 as Infor-
M mation Technology Year (IT82), and
told us all that IT was the hottest thing
since toasted sandwiches! Scattered
through their glossy dross of propaganda
were predictions of an industrial re-
covery in the UK derived from the new
technologies . However, such industrial
development would rely on a national
electronic grid, based on an expansion 5
and integration of present cable sytems,
through which the vast amount of elec-
tronic data - crucial to an `information
society' - could be transmitted . After

IM months of rivalry between Departments

on the subject of cable expansion, the
 CAPITAL & CLASS
6 government ended IT82 by postponing
any decision on cable expansion until the
advent of a Home Office White Paper,
expected in early 1983 . After a year in
which the government had been en-
couraging the expansion of cable
systems as fast as possible, it suddenly
slammed on the brakes . We shall argue
that this is because it realised that its
attitude to cable expansion - an attitude
derived from its monetarist view of the
present role of the UK state - has failed to
win the support of industrial and finance
capital in the UK .
Contradictions
By the time you read this, that White
Paper may well have been published .
This material aims to help you judge
whether the contents of that White
Paper has enabled the government to
reconcile the mass of contradictions
which constitute its present approach to
cable expansion . At the heart of this
government's strategy for the UK
communications industry are two con-
tradictions . Firstly between the roles of
the Home Office and of the Department
of Industry (DOI) ; secondly between the
government's rhetoric of reducing state
intervention and their practice of selec-
tively funding industrial development .
Throughout 1982, these contradictions
threw the government's policies on com-
munications and on Information Tech-
nology into chaos . Its lack of a coherent
plan for the expansion of cable as a com-
munications medium is only an illus-
tration of an overall lack of a policy-
making mechanism appropriate to the
increasing rate of technological change
in communications . The overall result
has been that a series of ad hoc com-
mittees has been established, resulting in
policy-formation by the back door .
While this mechanism guarantees a fast
government response to current de-
velopments in the communications in-
dustry, it avoids forward planning, and
stifles public discussion . What this
means in practice was shown by the way
in which the fates of four TV channels
were decided .
In February 1982, Home Secretary
W hitelaw announced that the BBC was to
be allocated two satellite television
channels . Then, in November, he re-
vealed that the two frequency-bands
currently assigned to 405-line television
were to be re-assigned to mobile radio .
These decisions, and the way they have
been taken, have profound implications
for public control of UK communication
development . These four television
channels have been given away by a
handful of engineers, politicians and
civil servants in a little under 12 months!
In the case of cable expansion, those
two contraditions - between Home
Office and DOI, and between rhetoric
and practice - have been combined into
a tussle for power over communications
policy between the two departments .
Home Secretary W hitelaw has waved the
flag of 'non-interventionism' in his es-
pousal of the hope that the cable com-
panies themselves will expand their
cable systems without the assistance or
investment of state funding . Information
Technology Minister Baker has waved
the `interventionism' flag in describing
the technical details of such expanded
systems, and in sponsoring the develop-
ment of IT manufacturing companies
which would market some or all of the
components for such systems .
The stage was set for the actual domi-
nance of the DOI's approach to cable - as
opposed to the public dominance of the
Home Office - with the publication in
March 1982 of the `Report on Cable

Systems', written by the Cabinet's In-
formation Technology Advisory Panel
(ITAP), which was appointed by the
Prime Minister in July 1981 . The ITAP
report recommended that private
companies (such as Rediffusion, Vision-
hire, and Telefusion, the UK's three
biggest cable companies, should be en-
couraged to establish a chain of local
cable networks, with a minimum ca-
pacity of, say, 30 channels each, and that
the operator of each network should be
given monopoly control over its con-
tents . It also said that cable operators
should be freed from government con-
trol, and should be positively encouraged
to install new cable systems to provide
entertainment and also home-banking,
-shopping, and -voting, plus remote
metering of gas, water and electricity,
together with domestic security systems .
Implicit in the ITAP proposals was the
provision of an electronic grid, com-
plementing exactly the DOT's emphasis
on information technology as the key to
industrial development . This is a view
shared by other sections of the Con-
servative Party : prior to the 1979 General
Election, a draft policy document had
asserted that `the battle lines are already
being drawn for the struggle to control
information in Britain . . .Information is
the commanding height of tomorrow's
economy' .
Hunt Committee
On the day the ITAP report was pub-
lished, Home Secretary Whitelaw told
the House of Commons that ` . . .there
should be an independent enquiry into
the important broadcasting policy as-
pects . . . (of cable expansion) . . .' The
enquiry was conducted by the Hunt
Committee, whose Report was published
just over six months later in October .
BEHIND THE NEWS
Much-applauded by the media - but 7
to a lesser extent by the City of London -
the Hunt Report is only a blueprint for
inertia . Firstly, it allows the existing
cable companies to expand their net-
work's capacity NOT by encouraging
them to lay new co-axial cable (giving a
band-width equivalent to at least 30 tele-
vision channels, as compared with the
four channel capacity of 85% of the UK's
outdated cable networks), but by
removing their requirement that they
should carry all nationally available
television channels - ie BBC and ITV .
This frees four channels for the
companies to transmit Pay TV . Although
this arrangement is only supposed to last
for five years, Hunt has no suggestions
on how the national service should be
re-inforced thereafter . More
importantly, Hunt has created
uncertainty about the future importance
of any particular medium of
information-transmission . Will enter-
tainment concentrate on cable, satellite,
or some mixture of the two? Will busi-
ness data-transmission occur on cable,
microwave or radio? This uncertainty
could lead to inadequate investment in
UK communications technology at a time
of massive state-led investment overseas .
Large amounts of industrial capital
are tied up in a service sector which is
relatively unproductive but also rela-
tively vulnerable to mechanisation using
information technology, for example,
the banks and the retail trade . More than
33% of the workforce in the OECD
countries are now in information-related
jobs, of which 2/3 are vulnerable to
mechanisation .
A national, integrated, high-capacity
cable system could carry massive
amounts of business data, far beyond the
amount which British Telecom (BT)
already carries . However the govern-
 CAPITAL & CLASS
8 ment's present approach to cable accords
no role to BT, but concentrates instead
on the cable companies . Ministers hope
that investment in cable expansion will
be 'entertainment-led' through sub-
scriptions for Pay TV delivered to sub-
scribers' homes through high-capacity
cables . Once in place these cables could
also be used for the transmission of
business data .
But how realistic is this plan? The
cable companies appear to have no in-
centive to upgrade their present separate
networks, since they will get Pay TV
anyway on all four existing channels
under the recommendations of the Hunt
Report . All the current visions of cable
subscribers sitting in their homes with a
keyboard and a video screen revelling in
the joys of 'tele-banking', 'tele-
shopping', or `tele-homeworking' would
require complete rewiring of current
cable networks . Even if the cable com-
panies were able to find finance capital
eager to invest in an upgrading of their
system, which they can't do at present,
each cable company would upgrade one
or more of its networks in isolation from
the others and in isolation from other
companies' networks, which precludes a
national network . For the state to inter-
vene in the upgrading and expansion of
the United Kingdom's telecommuni-
cation and cable TV networks would be a
classic example of the state `servicing'
the needs of capital, as has been the case
with, for example, a transport infra-
structure and an educated and trained
workforce .
Profitability
The present Conservative govern-
ment, however, is intent on concentrat-
ing the role of the UK state on market
regulation - in particular through con-
trolling the money supply and the work-
force . Consequently, its communication
policies represent an abdication of the
organising role of the state, through a
reduction in state spending . This is par-
ticularly significant in the case of ex-
pansion of cable systems because the
cable companies are having difficulties
in finding finance capital ready to invest
in u pgrading . U K stockbrokers and
potential investors are sceptical about
the profitability of upgraded cable
systems . If there is a profit to be made, it
is felt, it would only be in the long term .
Kitkat and Aitken, a Stock Exchange
research firm, surveyed about 50 in-
vestment institutions in 1982 ; some were
mildly enthusiastic about cable ex-
pansion, but most tended to be luke-
warm, severely reducing hopes for a
private-sector-funded expansion of cable
systems . Much of the City's caution is
due to the high capital investment which
would be required . Using figures from
the us cable sector, Stock Exchange
researchers de Zoete and Bevan show
that financing of cable systems involves
the absorption of a substantial pro-
portion of cash flow in the form of in-
terest payments .
In this situation, an alliance between
capital and the Labour Movement is
possible in the development of an ex-
pansion of cable systems . W e are familiar
with the Conservatives using their
alliance with capital to `hive off' profit-
able sections of nationalised or state-run
activities, such as British Rail hotels,
Britoil, British Telecom, and so on . At
both local and regional levels, it is
possible now for Labour Local Auth-
orities to use an alliance with capital to
`hive on' the needs and wishes of the
Labour movement to the private in-
terests which are not being served by the
present government's approach to the

expansion of cable systems . Given that
Labour Councils which are becoming
interested in cable expansion are doing
so from within their attempted local
Alternative Economic Strategies (AES),
then their local/regional policies towards
cable could be regarded as pilots for a
national Labour policy within a national
AES . The sorts of results we might see as
a result of this 'hiving on' would be cable
systems in which access wasn't solely
dependent on ability to pay ; which had
extensive interactive capability enabling
their users to be other than just viewers
of predetermined material ; which had
the capacity and facilities to represent
the plurality of views which exist on
social, political, economic and cultural
issues ; and which could facilitate com-
munications between different interest
groups (eg Trade Unions) at national,
regional and local levels .
Alliances
In the current political/economic
climate, no Local Authority can expect
on its own to exert a major influence on
central government's communications
policies - and especially not the left wing
Labour Councils which are most likely
to want to `hive on' social interests as has
just been described . This judgement has
been reinforced by the determination of
the Hunt Committee to exclude Local
Authorities from every aspect of the
development of cable systems . Accord-
ingly, we feel that Local Authorities will
be most able to exert influence and
develop new policies from within some
form of alliance between public and
private sectors . To see what such
alliances look like in practice, we will
examine the very real possibilities of
Local Authorities becoming members of
consortia for the purposes of operating
BEHIND THE NEWS
and installing expanded cable systems . 9
Before we do that however, let us
note that at the national level, the
Labour Party's `shadow cabinet' has
been as incoherent as the government in
formulating its oppositional policies on
communications, precisely because it is
a `shadow' of the government's division
of responsibilities . It has also largely
accepted the proposition that `cable' is
synonymous with `cable TV . Since it was
Home Secretary Whitelaw who was
chosen to open the Commons debate on
Cable and the Hunt Report on the 2nd of
December 1982, Labour chose its
shadow Home Secretary - Roy Hatters-
ley - to lead what little reply they had to
make . However, the real work on cable
expansion has been undertaken in the
DOI and it was noticeable in that
Commons debate that although White-
law gave a general indication of govern-
ment thinking on the regulation of
whatever expanded cable systems might
appear, it was the DOI - in the form of
Information Technology Minister
Kenneth Baker - which spelt out the
beginnings of a technical framework for
cable expansion which would decide just
what systems would be capable of doing .
Significantly, and crucially, Labour put
up no speaker of equivalent stature to
Baker . It was left to Labour backbencher
MP Geoffrey Robinson, 3'h hours into
the debate, to make the point that `there
is an urgent need to discuss with British
Telecom and other (sic) cable manu-
facturers the timescale and standard of
advanced internationally competitive
technology for establishing a national
electronic grid' . Conservative back-
benchers were not so slow in puncturing
the balloon of `cable = cable TV = Home
Office' . As Geoffrey-Johnson Smith put
it ; `Judging from the debate, one would
imagine that . . .(television) was the sole
 CAPITAL & CLASS
10 and run expanded cable systems . A par-
ticular Local Authority may wish to have
a direct input, eg representation by
Councillors on the consortium's Board,
or an indirect input, such as represen-
tation on the Board by members of a
ing but about the central nervous system
of the whole modern economy . . .we
should have our sights firmly set upon
establishing a national electronic grid' .
Forum lacking
The lack of a Minister of Com-
munications and an opposition `Shadow'
has been a major reason why new com-
munications policies in the UK have
developed in a vacuum . Currently there
is a lack of any public forum in which the
many and varied issues surrounding the
development of communications tech-
nology can be discussed . In particular,
there is no opportunity for the producers
and consumers of this technology to dis-
cuss the current and future development
of this industry . A number of Labour-
controlled Local Authorities realise the
importance of participation in expanded
cable systems in their area . Thus the
task of creating communications policies
which are coherent at local and national
levels has, in our opinion, been placed
firmly on the political agenda for the
Labour Party . Local Authorities can fill
that vacuum we spoke of earlier by es-
tablishing Communications Committees,
closely linked to their industrial, eco-
nomic, and employment committees .
The immediate task of these com-
mittees would be a 'watch-and-
comment' brief: to scrutinise, analyse
and criticise existing and proposed state
policies relating to communications and
information technology, and thus to
formulate a comprehensive, oppo-
sitional framework . In doing so, we
would suggest that members of these
committees establish and maintain
regular contacts with the relevant trade
unions and industrial associations ;
indeed, Councillors on these committees
may wish to consider co-opting in-
dividuals from these organisations onto
their committees to supplement their
own knowledge and experience .
Their oppositional communications
policy framework should include pro-
posals for democratic control at a re-
gional level of the whole range of
activities within the information tech-
nology and communications industries .
Accordingly, we would suggest that
another task of these committees would
be to hold regular seminars with local
industries and unions in order to relate
their policies to the practical details of
industry in their area . These discussions
could, we suggest, form the basis for
future planned industrial growth in
these industries . Although our emphasis
throughout these proposals has been on
the implications of communications
technology development for the future
of the workforce and of the UK industrial
sector, this is not to ignore the pro-
grammes and data that are produced and
transmitted via that communications
sector . Indeed, we have suggested that
these Local Authority Communications
Committees are located within the orbit
of industry and employment precisely to
raise the issue of `content' in discussions
about jobs, thereby linking the interests
of consumers with those of producers .
The final task of these Committees
would be to formulate communications
policies for discussion in meetings of the
full Council .
On the particular subject of cable ex-
pansion, we have found considerable
interest in the idea of Local Authorities
participating in local consortia to provide

reason for having cable in Britain . How-
ever, it is not . The only reason for cable
television is that it is one way of helping
to finance the cabling of Britain' . Even
Ian Wriggelsworth (SDP) was clear that,
`we are talking not just about broadcast-
local enterprise/development organis-
ation . The formation of a local cable
consortium would, of itself, be an
argument for the establishment of a cable
franchise corresponding to the local
basis of a Communication Committee's
activities .
Despite Hunt's opposition to Local
Authority involvement in cable fran-
chises - which is likely to be reflected in
the White Paper - local cable consortia
could provide a focal point around
which could gather the interests (both
public and private) behind information
technology . The formation of consortia
could be an occasion on which a number
of policy issues of general public concern
and particular concern to the economic
and industrial policies of the local
authority could be publicly aired . These
would include such questions as : will the
cable systems be technically compatible
with each other, and thus capable of
forming an integrated national network
- an electronic grid? Will the re-cabling
process increase the range of socially-
useful products which are being manu-
factured, in the form of physical
components and data/programmes? Will
the re-cabling use components and the
technology which will stimulate and
contribute to the development of a
strong UK communications component-
manufacturing industry? Once con-
structed, will there be improved access
to facilities and training to ensure that
there is plurality in the data and pro-
grammes which the cable systems trans-
mit?
BEHIND THE NEWS
11
Interests
We have already identified the in-
terests behind IT in general and cable in
particular as those of finance and in-
dustrial capital, as well as that of British
Telecom (which would benefit from any
increase in data/transmission) . From the
point of view of a Local Authority con-
templating membership of a local cable
consortium, there is an overlay of other
interests, ie the specific interests of the
workers in IT - as represented by their
Unions - and the more general interests
of workers and consumers as represented
(at a regional and local level) by Local
Authorities . A consortium should, we
suggest, include the following interests :
the Local Authority, British Telecom
(via its Regional management), the cable
TV companies operating in the area,
component manufacturers in the area,
and Regional representatives of the BBC
and the IBA . It is likely that the relations
which each member of a consortium will
have with other members will lie some-
where along a spectrum . The spectrum
would range from `informal information-
exchange' at one end, to 'financial/legal
partner' at the other .
At one end of that spectrum, the con-
sortium's members could be an informal
associations of interests which wish to
make their collective voice heard in
debates about IT policy . Or it could be a
formal association which decides
policies (which could be held as binding)
regarding its members' practices, eg it
could decide mutually-beneficial tech-
nical standards . Moving towards the
other end of the spectrum ; the con-
sortium may well develop two classes of
member once it forms itself into a legal/
financial association . Some or all of the
members may wish to form a company
 CAPITAL & CLASS
12 to manufacture and/or market particular
products . Some or all of the members
may wish to form a company to bid for a
cable franchise . In those situations,
members of the consortium who can't/
won't enter into a financial/legal as-
sociation might establish informal links
with those which do . In summary the
key note is flexibility . The overall ob-
jective in forming a consortium would be
to provide that forum - currently non
existent - for public debate and for
planned industrial development in the
UK communications/IT industry . In
order to avoid the wasteful duplication
of resources, and to avoid swamping the
vulnerable UK IT industry with imports,
IT needs to develop within a framework
of planned industrial/social growth . The
effectiveness of such a framework will
depend upon its comprehensiveness : the
greater its ability to include co-existing
interests and to take account of conflict-
ing interests, than the greater the degree
of coherence is possible in planning that
industrial/social growth . To put this
another way : if your industrial plan
ignores a major company in the sector,
then in reality it's no plan at all .
Tasks
In one way or another, such consortia
would exist to provide mass-access high-
capacity communications cable systems
for their areas . We would agree, there-
fore, that the tasks of each consortium
would be grouped around three chrono-
logical stages, each relating to particular
technologies . The first stage would be
based on the communications cables that
are in use now, and the task of the con-
sortium would be to co-ordinate (and
thus maximise) the use of these disparate
services, including telephone lines, cable
TV systems, and electricity mains cables .
The second stage would be the demo-
graphic and geographic expansion of
those co-ordinated existing services, plus
planning for their upgrading . The third
stage would entail replacement of exist-
ing cables in the area by optical fibre
cables, to produce a wide band high-
capacity system, and would be likely to
start in the mid 1980s . Consequently,
the range of practical activities to be
undertaken by members of consortia will
be very wide - which is why we have
proposed consortia with a wide member-
ship . In describing the stages of develop-
ment of the consortium, it should be
clear that it gives the flexibility for any
member to withdraw at any stage, while
the consortium as a whole has an overall
orientation towards a comprehensive re-
cabling programme for the area in
question .
The first task of a local cable con-
sortium, then, will be to coordinate the
communications systems already offered
to customers by the members of the con-
sortium . Only in later years does the
consortium need to undertake re-cabling
of its area of operation . Many of the
much publicised `new cable services' are
in fact already available in some form or
another . Thus, a form of home-banking
('tele-banking') is being tested by the
Midland Bank, using ordinary telephone
(HF multipair) cable . A (limited!) form
of home-shopping ('tele-shopping') al-
ready exists on BT'S 'Prestel' system .
Remote metering of gas, water and elec-
tricity is being tested by Thorn EMI in
collaboration with the Water Boards, etc .
Pay TV is already being provided through
the many cable systems operated by the
cable TV companies . Domestic/business
data-transmission already occurs using
the telephone cables, as well as BT'S
packet-switching trunk service for busi-
ness . A variety of feature films is already

available through the rental/sale of video
cassettes and video discs, and BT is set to
test a wide band high-capacity network
- which would bring all the services
together - in upwards of 10,000 homes .
Given that the advantages of co-axial
cable can already be achieved through a
co-ordination of service delivery -
mostly through HF multipair telephone
wires - and that optical fibres will be
available on a mass basis in 1985, the
economics of recabling now with co-axial
cables are suicidal, given co-axial's
imminent obsolescence . Finance is un-
likely, in this situation, to be forth-
coming for companies wishing to
immediately re-cable with co-axial cable ;
hence the lack of enthusiasm from the
City for the current proposals from the
cable TV companies to upgrade their sys-
tems using co-axial cables .
Effectiveness
In the first stage, the consortium
would be establishing working links
between service and maintenance staff
across the range of services to be
provided, and in order to do that
effectively, it would have to try to
include all those services, and thus all
their providers . The current existence of
all those services - albeit on disparate
systems - means that the question of
whether or not to re-cable is changed to
the question of what you lose by not
re-cabling immediately .
The actual task of co-ordinating ex-
isting service delivery will include the
synchronising of installation/removal of
infrastructure and components ; ensur-
ing that if/when the different services
need to interact, that they are technically
compatible ; monitoring the effectiveness
of existing service delivery, particularly
if this would involve more than one
BEHIND THE NEWS
member of the consortium ; and at- 13
tempting to centralise subscribers' pay-
ment for whatever range of services she
or he chooses to have from the range
available . This policy has a clear parallel
at a national level in an Alternative
Economic Strategy : `A policy for ex-
pansion can be divided into two stages .
In the first stage, the prime objective
would be to bring unused resources into
production to provide employment and
high levels of surplus . In the second
stage, once full employment has been
reached, further expansion can be
achieved only by using resources more
efficiently and by employing new tech-
niques of production' ('The Alternative
Economic Strategy' CSE London Work-
ing Group, 1980 . Page 35) .
The consortium's second task would
be to encourage an increase in the dis-
tribution and use of the existing
information-delivery systems, such as
telephone and cable TV . Expansion
would increase the number of sub-
scribers to the existing systems and, con-
sequently, provide a stimulus to the rele-
vant component-manufacturing sectors .
By so doing, it will increase mass-access
to electronic channels of communicat-
ions, and will generate employment
through planned industrial growth . The
easiest way of making the facilities avail-
able to more people would be by socialis-
ing access to them, through a combi-
nation of a library and a `information
shop' . These hybrids could be es-
tablished in existing premises belonging
to members of the consortium ; eg
through the rental/sale shops of the cable
TV companies ; Local Authorities' li-
braries, housing offices, etc . This policy
would have the advantage of being able
to offer a small input of resources in-
itially, and then building as demand
grows . A comparison could be drawn
 CAPITAL & CLASS
14 with the recent growth in the numbers of
`corner shop' instant printers . This is
not to suggest that the various facilities
will only be available at those in-
formation shops, merely that they will
be available there to everyone who wants
to use them . This would occur in parallel
to the development of identical `home
information systems', and would mean
that access to information would be less
based on income . The parallel with the
current library service is clear .
The final and continuing task of the
consortium would be the upgrading of
the co-ordinated services, both in terms
of technology and in terms of organ-
isation . It is at this stage that the relations
between the consortium's members
become crucial, in that the technological
change to optical fibres implies the or-
ganisational change to the integrated
provision of services .
The upgrading to a high capacity
network, designed to be a part of a wide-
band integrated national system, would
clearly not occur for some time, given
the technical and organisational diffi-
culties involved . However, the first steps
outlined above are practical and im-
mediate, and there is an urgent need for
moves to be made towards formulating
an oppositional communications policy
to set against the government's actions .
The labour movement must seize the
opportunities offered by the technologi-
cal developments in the communications
industry . Without a major encourage-
ment and reorganisation of the UK in-
formation industry and communications
industries, they will be crushed under
the weight of imports for multinational
communications companies . The demise
of those industries will eliminate the
major hope of a significant revival in UK
manufacturing .
Patrick Hughes
Neil McCartney


BEHIND THE NEWS

15

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CAPITAL & CLASS


Ron Smith

Abstract
Although militarism
is central to modern
society, the analysis
of it is very
fragmented . This
fragmentation arises
because militarism
is not a unitary
phenomenon, but a
portmanteau
description covering
a number of distinct
aspects . These
Aspects of militarism include : high levels
of military
expenditure ; the
THE CENTRALITY of Militarism to modern society makes it a militarisation of
question of major theoretical concern . The end of detente, esca- domestic social
lating military budgets, the increased domestic use of the armed relations ; the use of
forces, and the prevalence of war have also made it an urgent force in
international
political question . These notes provide some background to the relations ; and the
various aspects of militarism and suggest a broad framework nuclear arms race .
within which they may be understood . The level of analysis Each of the different
adopted will be of immediate complexity, lying between the aspects of militarism
specific conjunctural questions like Trident, Cruise and the arises in an organic
way from major
Falklands and the systemic questions about the operation of the conflicts in the
state or capital in general . But at that level, the notes will try to modern world . Each
draw together the wide range of issues pertaining to militarism .' has a particular
momentum which
arises partly from
What is militarism? the dynamic of the
The degree of fragmentation in the literature relating to the conflict and partly
military is striking . Not only are there a wide variety of theories from the dynamic of
on the Left, orthodox writing is equally diverse . Strategic, tacti- the corresponding
form of military 17
cal, technical, political, sociological and economic writings on organisation and
the subject have few points of contact . The difficulty of establish- technology .
ing a frame of reference is increased because it is necessary to
keep changing the mode of discourse employed . For instance,
one mode involves the clinical discussion in game theory terms of
nuclear stability, mutual assured destruction, counterforce
capability and targeting options . But while the analysis is perfectly
 CAPITAL & CLASS

18 logical in its own terms, these rational decisions produce the

prospect of the ultimate irrational outcome . For this outcome the
peace and medical community have a quite different mode of
discourse to describe the consequence of holocaust .
This fragmention in language, theory and approach is a
major obstacle to understanding the phenomenon . The im-
portance of the linkages between the political, economic, and
strategic aspects of the military, the pervasive nature of militar-
ism, and the political need to oppose it, all demand an analysis
which integrates the military into a more general theory of
society . On the face of it, Marxism seems more likely to provide
such an integration because the framework explicitly takes
account of the connections between economics, politics and
ideology . In addition there is a long tradition of Marxist writing
on the subject . Engels, Liebknecht, Luxemburg, Lenin and
Trotsky all considered it 2 as have many more recent Marxists' .
On the whole, Marxists have not tried to provide a general
theory of militarism, but have theorised the links between specific
aspects of militarism, civil society and the economy . They have
not treated militarism as some underlying unitary phenomenon,
as has been common elsewhere, but have analysed specific his-
torical connections . This appears to be the appropriate approach
for reasons which will be explained . But in this light one can
interpret the fragmentation in military studies as reflecting real
features of the phenomenon, rather than merely being a product
of the divergent modes of discourse employed .
The term militarism usually carries the connotation of
excessive influence of the military in society, but more precise
definition becomes problematic . In a recent book on militarism
14 of the 19 papers were concerned with attempting to define it' .
These definitional difficulties arise because the term is effectively
a portmanteau description covering a number of separate
phenomena . These include :
(a) high levels of military expenditure
(b) the militarisation of domestic social relations
(c) tendencies towards war and the use of force in international
relations
(d) the nuclear arms race
It seems more useful to treat these four as distinct
responses covered by a generic descriptive term, militarism,
rather than regarding each as merely a manifestation of some
unitary abstract force, militarism . It is important to regard
militarism as a description rather than an abstraction because
although there are conjunctural associations between the four
aspects there seems to be no real structural relation between
them, except that each involve the military .
 ASPECTS OF MILITARISM

A number of examples might illustrate the lack of struc- 19

tural relation . By criterion (c) Britain has historically been a very
militaristic society with a high proclivity to go to war and to resort
to force in international relations . In the Richardson list of wars
1820-1952, Britain participated in a fifth of the wars catalogued,
many more than any other nation . I But this was combined with a
very limited role of the military in domestic society by inter-
national standards and low shares of military expenditure in
output . 6 Thus on citeria (a) and (b) Britain was a very unmilitar-
istic society . It could be so because other forms of regulation
maintained social order and power relations and made unnecess-
ary domestic military involvement . The ruling class, in fact, saw
the army as a potential threat to themselves . In addition, for
Britain, war mongering was relatively inexpensive because the
navy was a cheap way to project force and the colonies bore much
of the cost .
One might anticipate an association between (b), (a) and
(c) since military governments, the extreme form of militarism of
domestic social relations, might be expected to spend more on
the armed forces and be internationally more bellicose . How-
ever, the evidence does not suggest that this is true . On average
military rulers do not increase the size of military budgets .'
There is in addition a tendency for involvement of the military in
domestic politics and power to create promotion patterns, or-
ganisational structures, and values which are detrimental to
combat effectiveness . The poor performance of military regimes
in conflicts with other states (e .g . the Greek and Argentinian
Juntas) should caution them against starting wars .
Defining a military government raises problems . For in-
stance, should the us be regarded as having a military govern-
ment between 1953-60, because Eisenhower was a general? The
example also illustrates that military affiliation cannot be ident-
ified with militarist tendencies . In many ways Eisenhower was
the least militaristic of recent us presidents . He gave the world
the term `military industrial complex' and warned of the danger-
ous power of the alliance between arms firms, service chiefs and
defence bureaucrats . He stopped us intervention in Vietnam
after Dien Bien Phu, and refused to be alarmed by the imaginary
`missile gap', between the us and USSR, which Kennedy cam-
paigned on .
There are enough historical anomalies of this sort to make
searching for a single underlying force or personal characteristic
which explains abstract tendencies towards militarism an un-
helpful approach . Instead it seems more useful to examine each
of the four elements separately and to try to identify the historical
and structural factors that give rise to each of them .


CAPITAL & CLASS

20 Levels of The post-war period has seen a much higher proportion of output
military devoted to military expenditure than earlier periods, and the
expenditure world total is now over 600 billion dollars . This high share of
output by historical standards seems to be the pattern in capital-
ist, socialist and less developed countries alike, though there are
individual exceptions, of which Japan is the most notable . Over
the 1960's and 70's military expenditures were growing faster in
the Third World than elsewhere, though the rapid planned
growth in NATO expenditures may change that . High military
expenditures are of concern both because of the vast waste of
resources involved and because of the effects of the creation of a
military industrial complex . The international articulation of
state and private capital is highly developed in the military
sphere, and the expansion of this sector has marked effects on
social, political and economic organisation'
The economic effects of high military expenditure are a
subject of controversy . A major ideological argument for military
expenditure rests on the idea that it creates jobs, and some
marxist writers have emphasised the use of military expenditure
by capitalist states to meet economic needs . These might be the
needs of individual capitalists - to provide profits for arms manu-
facturers - or the needs of capital in general - to offset tendencies
to crisis . With respect to the latter, it has been suggested that this
might be achieved in three different ways, each corresponding to
a different theory of crisis . Military expenditure may absorb
surplus allowing capitalists to realise it as profit . It may slow the
rate of increase in the organic composition of capital by diverting
capital from accumulation, while technological spin-off from
military R and D might cheapen the elements of constant capital
and increase relative surplus value . It might change the balance
of class forces by ideology, coercion or the co-option of members
of the working class, enabling capitalists to raise the rate of
exploitation and the share of profits . Each of these theories about
how military expenditure might contribute to counteracting the
tendency to crisis has its proponents . However, there is no
necessary reason why it should be military expenditure rather
than some other form of capitalist regulation that is used for these
purposes, nor is it clear that military expenditure need have these
effects in practice .
The historical evidence suggests that in the post-war period
military expenditure has been detrimental to accumulation . In
the UK and us, the two major imperial powers that maintained
high shares of military expenditure, this burden has reduced
investment ; diverted R and D funds and scarce scientific and
technical skills from civilian to military projects ; and resulted in
lower growth rates in productivity and output, loss of markets
 ASPECTS OF MILITARISM

and rising unemployment .' The form of the interaction between 21

military expenditure and the economy will depend on the histori-
cally specific stage of development with its associated structure of
industry, military organisation and class relations . Within post-
war capitalist societies the structure of the interaction is such that
it seems highly unlikely that the military expenditure was
prompted by economic motives .

The use of militarism to inhibit working class struggle against the Militarisation
system and to raise the rate of exploitation has a long history . of society .
Militarism may be used in a coercive way through direct repression
by troops or in an ideological way to instil values of hierarchy,
discipline and national interest . Culture becomes suffused with
military images of war, heroism and obedience, images which
have great political power . The public response to the Falklands
adventure shows the deep roots such responses have in English
life . In the third world where colonial borders have left new
nations to face deeply rooted regional conflicts and internal sep-
aratist movements, the army may be the only truly `national'
institution and have an important cohesive role . A role involving
not only the use of force but also the creation of a nationalist
ideology, and a national citizenship .
Maintenance of a social formation rests, in the last resort,
on ruling class control of the armed forces . But to the extent that
economic, political and ideological forms of civilian regulation
are effective, military forms may not be used at all . During the
long post-war boom, prosperity, cold-war rhetoric and social
democratic consensus maintained the general legitimacy of cap-
italist power relations in the west, within a framewrk provided by
us hegemony . The end of that era, the generalised crisis, and the
collapse of the material basis for a civil ideology of Keynesian
welfare capitalism has prompted the return to more coercive
forms of regulation and greater use of militarist ideology .
Economic coercion operates through higher unemployment and
reduced welfare benefits . Political coercion operates through
more repressive industrial and social legislation and increased
power for the security forces ." In the UK the transfer of tactics
acquired in Northern Ireland ; the concern with subversion and
low intensity operations in certain parts of the military ; the
development of a Home Defence network which integrates mili-
tary and civilian command structures ; and the transformation of
police and legal structures in response to riots and terrorism ; all
constitute actual or potential threats to democratic civil rights .
The state has a continuum of instruments of coercion from
social security administrators through police to the army . Thus
 CAPITAL & CLASS

22 increased repression may or may not involve increased use of the

military . Firstly, the use of militarism as an ideology, in es-
tablishing the legitimacy and political influence of the armed
forces and their role as representatives of national unity, is effec-
tive only to the extent that the military are not used as agents of
terror . Secondly, the ruling class may see the armed forces as a
threat to themselves, and this threat may be increased by their
domestic use . Military recruitment and structure is often dom-
inated by non-capitalist, typically feudal, class affiliations, and
military rule or values may constitute an obstacle to accumu-
lation . Thus the role of the military in the domestic maintenance
of a social formtion is not a simple one .

International The end of the Second World War also marked the beginning of a
use of force continuous Third World war . Decolonisation, superpower proxy
conflicts, regional antagonisms and competition for scarce re-
sources have generated over 150 wars, mainly in Africa and Asia,
in which tens of millions have died . U K armed forces have been
involved in armed conflict almost continuously for the past forty
years and the US and USSR have each used force or threat of force
repeatedly against third parties to attain their objectives ." Inter-
national law, diplomacy, arbitration or the United Nations have
not yet provided acceptable alternatives to war as dispute settle-
ment procedures . The consequence has been prolonged slaughter
in the South . The prevalence of conflict has caused Third World
governments to increase their military expenditures rapidly and
acquire the most modern weapon systems, including nuclear
ones . The burden of the defence budgets adds to the death,
disease and famine that follow war, by diverting skills, foreign
exchange and technology from pressing development needs .
These wars in the periphery tend to get taken for granted
in the West . Film from Beirut, Afghanistan, Cambodia, or the
Ogaden may temporarily shock, but is then forgotten . But these
wars are important for many reasons, primarily because of the
hardship and loss of life they cause . Secondly, because they
decide power relations, control over trade and minerals, and
mode of life over a large part of the globe. After a period of
containment in the 1960s, the seventies saw capitalist clients
displaced in South East Asia, Southern Africa, Latin America
and the Middle East . Thirdly, any one of these wars could
provoke conflict in the North . When two heavily armed and
hostile camps, like NATO and the Warsaw Pact, confront each
other with limited opportunity to back down or negotiate then
rigid mobilisation timetables and domestic incentives for bel-
ligerence can cause minor incidents to start wars . During crises
 ASPECTS OF MILITARISM

decision-makers tend to become rigid and inflexible, impulsive 23

and myopic, as the run-up to the Falklands war showed . In-
formation overload and massive uncertainty increase the
dangers . ' 2 World War I provides the standard example of a
relatively unimportant event provoking massive slaughter . In
1914 railway timetables determined the pace and character of
decisions ; now missile launching schedules do . In the Falklands,
there were three days to make the decision to send the Task
Force, and three weeks to negotiate while it sailed, yet still the
war was not avoided . In a nuclear confrontation the times might
be 3 hours and 3 minutes . While the provocation for World War
III need be no larger than that for World War I, the slaughter
certainly would be because of the final aspect of modern mili-
tarism, the nuclear arms race .

The first three aspects of militarism were familiar to Engels Nuclear

writing over a century ago . The threat of nuclear annihilation is a proliferation
recent addition . Although the world has lived with the threat of
nuclear destruction since 1945, vertical (within states) and hori-
zontal (among states) proliferation continues . There are now
over 50,000 warheads in the stockpiles and a new round of
escalation is under way . It is difficult to convey the extent of this
destructive potential when one Polaris submarine carries more
explosive power than was used in the whole of War War II,
including the two atomic bombs . There are six definite nuclear
weapons states, another two which almost certainly have nuclear
capability, and it is possible that there will be half a dozen new
additions to the club in the next decade . The risk of use increases
with each new weapon and each new decision centre . Despite the
incredible convolutions the concept provokes, the success of
deterrence in postponing war between the super-powers must be
recognised . The costs of use of nuclear weapons dwarf the bene-
fits . But it is difficult to have confidence in that success being
indefinitely repeated . Soviet or American leaders might, in certain
circumstances, see the risks as being worth taking, and the
incentives faced by small nuclear weapons states are quite dif-
ferent . Nor need use be deliberate policy . Technical malfunction,
or human failure, a misinterpreted incident or unauthorised
action could all cause an accidental holocaust . The well publicised
defects in the North American nuclear attack warning system
(NORAD) which led to three false alarms in 1979-80 are such a
possible cause .
The effects of even a limited nuclear war, namely one in
which only military installations are targeted, would be so cata-
strophic that this threat must colour any analysis of late twentieth
 CAPITAL & CLASS

24 century society ." In Europe the threat is greater since it is the

battlefield for which most preparations have been made . NATO
strategy, which still relies on the first use of nuclear weapons,
increases the danger . The structure of the confrontation and the
type of weapons deployed create powerful incentives towards
pre-emptive bombardment on both sides . The instability of the
position is increased because, while it only requires one nation to
start a nuclear war in Europe, it needs agreement by the four
nuclear powers operating there to stop it . 14
The centrality of nuclear proliferation to modern society
has been argued most strongly by E P Thomspon . To him the
bomb is the object of a new social order which has shaped and
structured the societies out of which it grew, a social order he
labels exterminism . 16 He asks 'if "the hand-mill gives you society
with the feudal lord ; the steam-mill society with the industrial
capitalist" what are we given by those Satanic Mills which are
now at work grinding out the means of human extermination?'
His answer is that the weapon systems have become independent
variables in an arms race that has acquired an autonomous
dynamic in both domestic and international politics . This
dynamic which is out of control, inertial and irrational, con-
ditions the whole of world politics . Exterminism has become 'a
non-dialectical contradiction, a state of absolute antagonism in
which both powers grow through confrontation, and which can
only be resolved by mutual extermination .'

Understanding The discussion of the four aspects of militarism above suggests

militarism some elements of an explanation . Military power is a particular
form of coercion which is used as an instrument by states to meet
their objectives in the major conflicts they face . In using military
power the states set in motion a process which has a form of
militarism as the end product . Militarism cannot be explained in
terms of the objectives of the state alone because these are
constrained by the nature of the environment in which the state
operates . In particular the nature of the prevailing class relations,
the nature of each conflict, and the nature of the instrument
itself, military force, all influence the process . Each of these has
dynamics of their own which in interaction lead to the develop-
ment of the various distinct aspects of militarism .
To begin with the nature of the conflicts . The international
community is composed of nation states divided loosely into
three blocs : capitalist, socialist and poor ; the first, second and
third world . 16 From this perspective, the world order may be
thought of as an ellipse with two foci and a periphery, within
which individual states are located . The ruling class in any state is
 ASPECTS OF MILITARISM

then involved in four major types of relationship which define the 25

political fractures of the modern world . These are the intra-state
confrontation arising from domestic class antagonisms ; the intra-
block rivalry with other states sharing a common form of eco-
nomic organisation and certain shared material interests ; and two
inter block competitions in which it participates against each of
the other systems . Thus the British state would be in conflict on
its own with (a) its domestic working class ; and (b) the other
capitalist states to maintain interimperialist advantage ; and in
conjunction with other capitalist states in conflict with (c) social-
ist states to maintain the capitalist sphere of influence ; and (d) the
third world to maintain control of markets and materials .
In any specific dispute the four types of conflict are over-
laid and this introduces considerable complexity . The fact that it
may pay to ally with a traditional enemy to deal with a more
pressing antagonist, does not lessen the material basis of the
conflict with the old enemy . To a large extent, the British nation
united to fight the Nazis as did the us and USSR with it ." But this
was a temporary and partial lull in class conflict and mutual
hostilities . Even in a single conflict the process and outcome
cannot be explained in terms of the operation of a single force .
The impact of opposing groups changes the direction of de-
velopment of the conflict and the s ystem . US and Soviet societies
cannot be understood in isolation from their impact on each
other, because that interaction has changed the character of both
societies . Likewise not only does the present structure of im-
perialism reflect both the internationalisation of accumulation
and the fight for self-determination in the periphery, but the
struggle between them has changed the nature of both accumu-
lation and self-determination .
For our purposes the complexity of the conflicts is second-
ary to the point that although military power plays a role in each,
the type of force involved differs between conflicts . The strategic
weaponry of the superpower confrontation, the rapid deploy-
ment forces used for imperial interventions in Shaba, Afghan-
istan, or the Falklands and the militias used in domestic peace
keeping involve different technologies, organisations and
structures . That differentiation has implications for the forms of
militarism that develop . At a very simple level, the different
services are often dissimilar in recruitment patterns, class affili-
ations and political outlook . At a more general level one can see
that three of the aspects of militarism considered above corres-
pond broadly to three types of fracture associated with major
conflict . The militarisation of society is associated with intra-
state class struggle ; the increased tendency to war with the split
between centre and periphery ; the nuclear proliferation with the


CAPITAL & CLASS

26 confrontation between capitalism and socialism, NATO and the

Warsaw Pact . The levels of military expenditure, the fourth
aspect, reflect the need to finance both the armed component of
each of these conflicts and the military element in interalliance
bargaining and cohesion .
Thus the first element in our explanation of militarism sees
the various aspects of it as manifestations of the major fractures
that divide the modern world, and their development as reflect-
ing the dynamic of those conflicts . But a second element is
needed . The military is not a passive instrument in these con-
flicts, the technology and social relations of force have a dynamic
of their own, and application of this instrument changes both the
user and those on whom it is used . This happens not only
through the political and ideological consequences of use, but
also through the economic impact of financing the military
burden . Militarism is a contradictory response in that it under-
mines the system it was designed to defend . The inherent dy-
namic of military development and its interaction with civil
society has been a topic of marxist interest, since Marx and
Engels . Marx asked `Is there anywhere where our theory that the

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 ASPECTS OF MILITARISM

organisation of labour is determined by the means of production 27

is more brilliantly confirmed than in the human slaughter in-
dustry' and in Anti-Duhring Engels developed this analysis .
This momentum of military development has been formal-
ised by Mary Kaldor'", who uses an analogy with standard
marxist terminology to provide a theory of the laws of motion of
the mode of destruction or warfare, rather than of production .
The development of the means of production themselves,
whether human or technological, generate new weapons
systems . These weapons systems, which combine technological
and social relations, condition more general forms of military
organisation and operation . This creates a specific labour pro-
cess, which in the competition with other military organisations,
develops an internal logic and laws of motion of its own . Such a
mode of destruction is constituted as the articulation of forces
and relations . The forces of destruction correspond to the mili-
tary technology now embodied in the weapon system (e .g . tank,
aircraft, battleship), an integrated combination of offensive and
defensive capability with associated methods of mobility, com-
mand and control . The relations of destruction correspond to the
forms of social relations and organisation within the armed forces
and between them and the rest of society, themselves conditioned
by the character of the technology they operate . Under the
coercive force of competition between combatants these are ar-
ticulated into a system with its own contradictions and mo-
mentum .
So far the discussion has been in terms of a general mode of
destruction or warfare, but a similar dialectical argument can be
applied to the specific forms, nuclear confrontation, peripheral
warfare and domestic militarism, and each has its own contradic-
tory system . Perhaps the most important question is the form of
resolution of these contradictions . Engels saw Militarism as con-
taining the seeds of its own destruction . Expenditure on armed
forces hastened financial catastrophe, universal military con-
scription transformed the army of the princes into the army of the
people, and the sophistication of the weapons made them out-
rageously costly and unusable in war . 19 None of these arguments
seems to apply to nuclear weapons, which are relatively cheap
and very much under the control of the princes . An alternative
interpretation is that war becomes the resolution, the means of
resolving the antagonistic contradictions in class society ." Given
that the forces of destruction have now reached their highest
stage in the mass of inter-continental ballistic missiles with their
multiple warheads and secure launching platforms few in the
west find appealing the Chinese extension of this argument : that
the mutual destruction of the two hegemonic powers will provide
 CAPITAL & CLASS

28 the material foundation for socialism .

Within the dialectical framework the theoretical and
political problem is that when thesis and antithesis appear to be
the confrontation of two highly militarised hostile blocs and the
destructive powers of the nuclear forces they are each geared to
develop, the most likely synthesis is mutual annihilation . Such a
synthesis would be profoundly unsatisfactory, not only on the
practical grounds that we do not relish our destruction but on the
theoretical grounds that it makes military organisation, a feature
of the superstructure and an epiphenomenal product of the
operation of the mode of production, ultimately determinant .
Theoretical misgivings will not, however, halt the drive to ex-
termination, halting that drive is a political process ."

Conclusion After a period when the Left showed little concern with the
military, there has been a revival of interest and a renewed
awareness of the threat that militarism poses . The argument here
has been that militarism should not be seen as an undifferentiated
concept, it has distinct aspects each of which need to be analysed
in a historically specific way . If this is done the different facets of
militarism arise in an organic way from each of the major conflicts
in the modern world . The momentum of each of the aspects -
nuclear, domestic, expenditures, and peripheral wars - comes
from the dynamic of each conflict and of the corresponding forms
of military organisation and technology . The analysis does
suggest that militarism contains the seeds of its own destruction,
but that destruction could come about in either of two ways .
Militarism could create the opposition that will destroy it, by
generating class, peace, and national liberation movements
against it . Alternatively, militarism coud lead to the annihilation
of civilisation, destroying itself along with everything else .


ASPECTS OF MILITARISM

This is a revised version of a paper presented to the SSRC Political 29

Economy Study Group . I am grateful to the SSRC for financial support
and the editors of Capital and Class for helpful comments .

1. The range of issues is well covered in New Left Review Notes

(1982), which is essential reading for anyone interested in militarism .
2. A convenient collection of the classics is provided by
Semmel (1981) . The major omission from it is Liebknecht (1973) . On
Luxembourg, see Ch . 9 of Rowthorn (1980) .
3. Reviews of more recent theories are provided in
Mackenzie (1983) and Smith (1977) .
4. Eide and Thee (1980) .
5. Richardson (1960) and Wilkinson (1980) . Counting wais
is a minor academic industry . It is estimated that Britain has been
involved in 88 since World War II (State Research Bulletin, p .139), but
this uses a different definition of war from Richardson . The definition
used by Small and Singer (1982), another major source for war counting,
tends to exclude the sort of wars Britain indulged in .
6. The historical pattern of British military expenditure since
1689 is analysed in Kohler (1980) . The UK's high defence burden since
the Korean war is a break from the historical pattern .
7. Measuring the effects of military governments on military
budgets is another minor academic industry . A good review, on which
the conclusionin the text is based, is Zuk and Thompson (1982) .
8. Cis (1982) provides information on the Military Industrial
Complex in the UK .
9. The empirical evidence is summarised in Georgiou and Smith
(1982) .
10 . These trends are well documented in the journal State Research .
11 . Two Brookings studies, Kaplan et al (1981) and Kaplan and
Blechman (1979) document 190 Soviet and 215 us incidents in which the
superpowers used military force as an instrument of diplomacy .
12 . Dixon (1976) discusses these features of the decision making
process during crises .
13 . The standard study of the effects of nuclear war is Office of
Technology Assessment (1980) ; Greene at al (1982) describe the possible
effects on London ; Trompe and Laroque (1982) on Europe .
14 . The issues associated with Nuclear War in Europe are discussed
in Trompe and Laroque (1982) .
15 . Thompson's article and rejoinders to it are reprinted in New Left
Review (1982) .
16 . The blocs are distinguished by their different forms of economic
organisation . The exact nature of the differences, whether they con-
stitute co-existing modes of production, different social formations
within capitalism, or whatever, while an important question, is not
germane to the argument here . However, it will be assumed that what-
ever the material basis of the class divisions, they all remain class societies
in which antagonistic social relations persist and that militarism is a
characteristic of class societies and not peculiar to capitalism .
17 . The significance of these coalitions for the UK is discussed in
Barnett (1982) .


CAPITAL & CLASS

30 18 . In New Left Review (1982) . She develops the concept of a

weapon system in Kaldor (1981) .
19 . Anti-Duhring Part II, Ch . III .
20 . Byely (1972) .
21 The politics of anti-militarism is discussed in Mackenzie
(1983) and New Left Review (1982) . UK aspects are discussed in Smith
(1983) .

References Barnett, Anthony (1982) `Iron Britannia' New Left Review No . 134
July-August .
Byely, et al. (1972) Marxism-Leninism on War and Army Progress Pub-
lishers .
cis (1982) War Lords, cis Report on the uK Arms Industry Counter In-
formation Services, Anti-Report 31 .
Dixon, Norman F . (1976) `On the Psychology of Military Incom-
petence', Jonathan Cape .
Eide, Asbjone and Thee, Marek (1980) Problems of Contemporary Mili-
tarism Croom Helm .
Georgiou G . and Smith R .P. Assessing Effects of Military Expenditure on
OECD Countries Birkbeck Discussion Paper No . 124 .
Green, O . (et al) (1982) London After the Bomb Oxford University Press .
Kaldor, M . (1981) The Baroque Arsenal Hill and Wang .
Kaplan, Stephen S . and Blechman, Barry (1979) Force Without War : us
Armed Forces as a Political Instrument Brookings .
Kaplan, Stephen S . (et al) (1981) Diplomacy of Power : Soviet Armed
Forces as a Political Instrument Brookings .
Kohler, G . (1980) `Determinants of the British defence burden' Bulletin
of Peace Proposals No . 1, p .79-85
Liebknecht (1973, translation) Militarism and Anti-Militarism Cam-
bridge .
Mackenzie, Donald (1983) `Militarism' Capital and Class 19 .
New Left Review (1982) Exterminism and Cold War Verso .
Office of Technology Assessment (1980) The Effects of Nuclear War us
Congress, Croom Helm .
Rowthorn, Bob (1980) Capitalism, Conflict and Inflation Lawrence and
Wishart .
Semmel, Bernard (1981) Marxism and the Science of War Oxford Univer-
sity Press .
Small, M ., and Singer, J . D . (1982) Resort to Arms Sage Publications .
Smith, R .P . (1977) `Military expenditure and capitalism' Cambridge
Journal of Economics Vol . I No . 1 .
Smith, R .P . (1983) `UK defence policy' Socialist Economic Review 1983
Merlin .
Trompe, H .W . and La Rocque, G .R . (1982) Nuclear War in Europe
Groningen University Press .
Richardson, L . F . (1960) Statistics of Deadly Quarrels Boxwood .
Wilkinson, D . (1980) Deadly Quarrels University of California Press .
Zuk G . and Thompson W .R . (1982) `The post-coup military spending
question' American Political Science Review March, Vol . 76 No .
1, p .60-74 .
 ASPECTS OF MILITARISM

31

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CAPITAL & CLASS
Donald MacKenzie

Militarism
and socialist theory
IN THE EARLY 1980s militarism has returned to the centre of This article argues
the political arena . December 1979 looks likely to be seen in that we should not
retrospect as a crucial divide, even though the events of that explain militarism
only economically,
month had much earlier origins . The North Atlantic Treaty nor see it as having
Organisation confirmed its earlier decision to introduce some six merely an `internal'
hundred new, highly accurate nuclear missiles to Europe ; and logic . The state and
Soviet troops entered Afghanistan . The resurgence of the Cold the international
system of states are
War evoked an equally dramatic resurgence of the peace move- centrally important
ment . Both far larger and geographically far more widespread in militarism . We
than earlier movements against nuclear weapons, the new move- urgently need
ment in less than two years has markedly altered the political further work on
climate of Western Europe, and has had ramifications both in the militarism and
gender, on
East and across the Atlantic . militarism as culture
British politics in particular have recently been dominated and on the socialist
by war in a way unprecedented since Suez . The short, brutal use of armed forces .
little conflict in the South Atlantic brought with it uncomfortable
lessons - that war could still command considerable popular 33
support, that a seemingly marginal and resolvable dispute could
lead to war, that the considerable inroads made by the Campaign
for Nuclear Disarmament in the Labour Party and elsewhere
were not easily translatable into effective opposition to a'conven-
tional' war, even one with nuclear weaponry in the combat zone .
In this situation, socialist analysis of militarism, long ne-

C & C 19 - C
 CAPITAL & CLASS

34 glected, has begun to revive .' I intend this paper to help this
process, largely by reviewing the resources available within the
Marxist tradition, widely conceived, that might assist us in our
understanding . I would neither claim to be comprehensive in my
coverage of these resources,' nor pretend that I have solutions to
the difficulties of existing analyses of militarism . In some areas
(such as the sections on weapons production and the law of value
or on gender, militarism and the state) I have been able to do little
more than point to the need for particular kinds of analyses .
Nevertheless, I am convinced that there are few areas
where the development of our theory is more important . I don't
mean that `the movement' needs the `right' theory to stop it going
off the rails . That sort of assertion - the typical arrogance of
Marxist intellectuals - is at best an idealist oversimplification of
the real conditions shaping the growth and decline of social and
political movements . But it remains true that after the initial
flowering of a movement such as the peace movement there often
comes a period where taking stock, gathering resources and
formulating goals are useful . Part of that process - though only
part of it - is a careful examination of what we are opposing, its
roots, manifestations, strengths and weaknesses, its connections
to other aspects of our society .
The core of contemporary militarism is often seen as
weaponry, as in its common characterisation as an `arms race' .
Accordingly, I shall - after a short discussion of the key term
, militarism'- begin by discussing weapons, focusing particularly
on how weapons are produced, and on some important conse-
quences of the way they are produced . Then I will discuss briefly
explanations of militarism that see its cause as being weapons
production and the undue influence of those who benefit from
the production of weapons . I'll argue that though those explan-
ations capture a lot of important phenomena of contemporary
weapons production, they fail if put forward as ultimate or
complete explanations .
In the next main section I'll examine the theories of mili-
tarism that are most commonly regarded as Marxist : economic
explanations of militarism . I shall argue that these explanations
both oversimplify the complex and historically variable impact of
militarism on capitalist economies, and are wrong in their ex-
clusive focus on the `economic' . In the following section I'll argue
that a much more satisfactory starting point for explanations of
militarism is the state, particularly as embedded in an inter-
national system of states . Marxist state theory in recent years has
had a strange tendency to be silent on the military activity of
states, and a parallel reticence on states' relations to other states
as key determinants of their development . Here, I shall suggest,
 MILITARISM AND THEORY

is a particularly vital area where our theory needs to be developed 35

if we are to understand militarism . Militarism, too, plays a key
role in defining the relation between the state and its `citizens',
and one that operates very differently for women than for men .
Male domination, militarism and the state are closely tied in ways
that urgently need unravelling .
In the penultimate section I'll turn to the cultural roots of
militarism . `Falklands Britain' revealed starkly the continuing, if
subterranean, vitality of militarist culture . However problematic
the `cultural' is for socialist theory, here is a further area that no
comprehensive political economy of militarism can neglect .
Finally I shall argue that an entirely proper and appropriate
focus on capitalist militarism should not blind us to militarism as
a problem for socialism . Many socialists throughout the world -
from Iran to Ireland to Nicaragua - have felt forced to the
conclusion that only through armed force can socialist goals be
achieved . Whether that is so is a decision that we in the capitalist
heartlands may eventually have to take . The orthodox answer of
the Marxist tradition to the dilemma this poses- that armed force
is a neutral instrument of the social forces that wield it - is glib . At
the least, we ought to reckon on the very real social and political
consequences that may flow from resort to organised armed
force .

A troublesome problem of definition obstructs the start of our What

enquiry . There is no consensus as to the meaning of the term `militarism'
`militarism' . I have no intention of entering here into a semantic means
debate, and so offer the following rough-and-ready, but service-
able, meaning . Militarism is a condition in which war, or the
preparation of the means of war, are major social concerns, command-
ing a significant proportion of resources and enjoying a substantial
degree of legitimacy .
However we define it, we need some term such as this that
captures this vital and widespread feature of contemporary
capitalism . (Although of course we must not imply that only
capitalist societies are militarist, or that all contemporary capital-
ist socieites are equally militarist . Patently, neither is true .) But I
cannot pretend that the choice of words is neutral . To talk of
militarism rather than `exterminism' - E P Thompson's preferred
term - is to say, amongst other things, that it is not only the drift
towards mass destruction that matters . To talk of militarism
rather than the `arms race' is to say that it is not only weapons that
matter . To talk of militarism rather than the `Cold War' is to say
that it is not only the East-West divide that deserves our attention .
To talk of militarism rather than the `war drive' is to remind us
that the politically effective use of military force often stops short
 CAPITAL & CLASS

36 of actual fighting . Of course, the users of these terms are far from
tied by these implications of them, but it seems worth choosing a
term that - despite its ambiguities and difficulties' - conveys the
scope of what we are opposing .

Capitalism The successful pursuit of war - militarism's rationale - has at

and the least two preconditions . People (in practice, normally, men) have
production to be forced or persuaded to fight, and have to be trained and
of weapons organised to do so effectively . This first precondition I shall
return to below . Secondly, these people have to be provided with
the physical wherewithal to make it possible for them to fight :
food, clothing, shelter, transport and, in particular, weapons . As
warfare has developed, the last of these preconditions has become
more and more salient . Of all the means of war, weapons have
become the central area of attention and debate, and the advanced
capitalist states now spend approximately as much on procuring
weapons as they do on paying, training and organising people to
use them .
So Engels (1878/1976 : 211-22) was right to place the
question of the production and availability of weapons at the
centre of Marxist analysis of military force . Just how are weapons
produced?
Until fairly recently, states directly organised the produc-
tion of weapons using their own facilities and their own em-
ployees . The wind-powered wooden battleships that were the
early foundation of Britain's imperial might were produced in
Royal Dockyards . The armouries that supplied the armed forces
of the United States - and in which crucial aspects of assembly-
line technology were developed (Merritt Roe Smith, 1977)-were
also state-owned . But, first in late nineteenth century Europe,
and much later in the United States, private capital began to
enter the production of weapons (Kaldor, 1982b :271) . The key
firms involved - Vickers, Krupp, Mitsubishi, Lockheed, Boeing
and the like - became central contributors to the war-fighting
capacity of their respective states .
Some weapons are still produced exclusively by the state .
This is most obviously true for the actual assembly of nuclear
bombs . But the means of delivering these bombs to their targets,
and the equally important systems of communications and control
that make them useable, are in the United States largely the
product of private capital, and in the United Kingdom are made
by a mix of private capital and of nationalised and semi-
nationalised firms like British Aerospace that operate as quasi-
autonomous capitals . `Conventional' weaponry - a deceptively
bland term that covers a vast range of weapons whose capacity to
 MILITARISM AND THEORY

kill and maim has been increased very dramatically since 1945 - 37
is, similarly, produced predominantly by private capitals .
It would be quite mistaken, however, to see weapons
production as simply a classic case of capitalist production for the
market . Not only are there relatively few major producers (not in
itself an uncommon situation in late capitalism), but, at least
until fairly recently, there was only one buyer, the state . While
again this is not a situation unique to weapons production, these
factors combine with others to produce a system of production
significantly different from that analysed by Marx in Capital, and
different too from that commonly assumed in bourgeois economic
theory . Two major recent attempts to grasp the `laws of motion'
of this production system are Kaldor (1982a) and Gansler (1982),
and what follows draws heavily on their work . I'll talk primarily
about the United States, since that is not only the most important,
but also the best-studied, of the Western weapons-production
systems .

The weapons-production system

At only one stage is there typically competition between

firms involved in weapons production : the very early state of
preliminary research and development . If a new missile, say, is to
be developed, several firms may bid for the contract to do the
initial development work . In practice, of course, only a very
small number of firms have the capacity to undertake such a
project, and the number may effectively be reduced further by
long-term links between one particular firm and the wing of the
military involved . While both Boeing and Lockheed have the
capacity to design and build major strategic nuclear missiles,
Lockheed has become the supplier to the United States Navy and
Boeing to the United States Air Force (Gansler, 1982 : 36) . In
countries other than the United States it may well be that in fact
only one firm could possibly produce the weapon involved, so
that even this stage of competition disappears .
Once the first development contract is sealed, competition
effectively ceases and - bar the risk of cancellation of the project-
the firm and the state are locked together for the duration of the
development and production cycle of the weapon . For complex
weapons such as missiles or aircraft that is for a very long time -
ten years or more . Because the product will be technically new,
neither exact design or price can be specified in advance . This
factor helps make weapons work and similar high-technology
projects different from other forms of contract work for the state .
It is in the interests of the firm to modify the contract as much as
possible once the competitive phase has ended, in part because it
 CAPITAL & CLASS

38 will often have submitted an unrealistically low initial bid to

secure the contract (Gansler, 1982 : 93) . Notoriously, contracts
typically `grow' by 50%, 100% or sometimes more from the initial
planning estimate .
Pricing is typically on a `cost-plus' basis : the firm is recom-
pensed for its total outlays, plus an agreed percentage profit .
That percentage profit appears low, often being no higher than
4% or 5% in the United States . It is held down both as a matter of
state policy and sometimes by penalties imposed on contractors .
But, significantly, firms can achieve a much higher rate of profit
on capital employed : 15% or even 30% or higher . This is because
their needs for capital are reduced both by the fact that a lot of
capital equipment (machine tools and so on, even whole factories)
is supplied to them by the state, and also by the system of regular
monthly progress payments for partially completed work .
Furthermore, weapons work can be a hidden subsidy to other
aspects of a firm's activities . Research and development costs are
reimbursed in full, often with little monitoring of the outcome of
the work, and with no restriction on the civilian exploitation of
military-funded work .
Profit rates vary considerably from firm to firm . Missile
work - where in the United States the government supplies
nearly all plant and equipment - is extremely good business .
Shipbuilding - where this tends not to happen - is much less
 MILITARISM AND THEORY

profitable . Large firms do much better than small ones . They 39

corner the role of `prime contractor' on major contracts, leaving
small firms the much less profitable and rapidly fluctuating sub-
contracting work . They monopolise the state-owned plant and
equipment in private hands, plant and equipment worth perhaps
$50 billion at replacement cost . Above all they monopolise the
crucial research and development money .'
At the same time, Gansler (1982) emphasises that a whole
set of barriers operates to deter other capitals, even big capitals,
from entering those areas of military production where profit
rates are significantly higher than average . A totally new entrant
would have to buy the equipment that existing weapons producers
have often got for nothing . It would have to undermine the close
links that exist between existing producers and the parts of the
military that buy from them . It would need to prove - without
any `track record' to go on - that it could come up with a better
product . It would need to build up a large and highly specialised
research, development and marketing capability in order even to
begin to compete .

Weapons production, the labour process and the law of value

When Marx discusses value in chapter one of Capital, he

emphasises that the value of a commodity reflects not the actual
time required to produce it, but the time socially necessary to do
so . `Inefficient' producers, those whose products embody more
actual labour-time than the socially necessary minimum, still
have to sell their products for the same as do the more `efficient'
producers . Marx points to the example of the hand-loom weavers,
crushed by the competition of the labour-time reducing power-
loom, crushed by the `law of value' .
At the very heart of capitalist production, Marx postulates,
is thus a drive to reduce to a minimum the labour-time it takes to
produce commodities . But this drive becomes an actuality, he
reminds us, only through `the coercive laws of competition'
(Capital 1, Penguin edn ., 433) . In weapons production those
`coercive laws' are suspended to a degree remarkable even for
contemproary monopoly capitalism . Weapons production, I
would suggest, is substantially insulated from the operation of
the law of value .
There is no clear incentive for capitalists to seek to minimise
the labour-time it takes to produce weapons . Indeed, the insti-
tutional system of weapons production tends to reward companies
that raise the costs of production rather than lower them . And,
because weapons typically do not, at least until quite recently,
enter a market, there is no straightforward exchange process by
 CAPITAL & CLASS

40 which the labour-time involved in producing one is equated with

the labour-time involved in producing another .
No exchange process . But as Mary Kaldor (1982b) em-
phasises, `there exists another form of commensuration for arma-
ments : war' . In time of war, especially total war, there certainly is
a pressure to reduce labour-time in weapons production . There is
no exact parallel with the law of value . It is more a question of
producing the maximum quantity of weapons in the minimum
period of time with physical limits on available labour power and
raw materials . But the Fordist techniques of law-of-value
dominated civilian production proved transferable to such a task .
As Kaldor (1982a) describes, the American triumph in the Second
World War was the triumph of the assembly line . Workforces
largely of newly-recruited women toiled for the same companies
that had produced the Model T Ford and its successors . They
made tanks and jeeps on the assembly lines that had produced
millions of cars, and on newly constructed assembly lines started
to produce aircraft . Ford `set a critically important example to
the aircraft industry' . One single aircraft plant, the Ford plant at
Willow Run, Michigan, succeeded in attaining a monthly output
half that of the entire German aircraft industry at its peak (Kaldor,
1982a : 59 and 55) . Even shipbuilding, that bastion of craft
procedures, began to be decisively affected by Fordist production
techniques .
In the absence of the stimulus of war, however, the
dynamic affecting the labour processes of weapons production
appears to be quite different . We simply lack the sort of systematic
comparison of civilian and weapons-production labour processes
that would enable any secure conclusion to be reached, but there
are some significant clues . Despite the technically advanced
nature of the products, and despite huge state investment in
plant, the equipment on which American weapons are produced
is typically old, `much older than the average American manu-
facturing equipment' (Gansler,1982 :57) . The people that actually
produce weapons are also often old - in sharp contrast to pro-
duction workers in 'Fordist' factories . In 1976 the average age of
production workers at Lockheed California was 55, at Fairchild
Long Island 56, and at Lockheed's aircraft plant at Marietta,
Georgia it was a scarcely credible 62 (Gansler, 1982 :53-54) . And,
of course, the numbers of weapons produced are lower - many
times lower- than at the peak of World War 2 . So while commen-
tators still speak of `production lines' for weapons, this use often
appears to be metaphorical rather an actual description of the
labour process . Such inadequate information as I have been able
to gather suggests that much of the labour process in, say, aircraft
production is `nodal' (workers going to the work) rather than
 MILITARISM AND THEORY

assembly line (the work coming to the workers) . One informant 41

told me that when the production of F-4 phantom fighter-
bombers had to be boosted during the Vietnam War, McDonnell-
Douglas engineers had to go to Detroit to learn genuine
production-line techniques from the car industry .
What all this points to is, I think, neatly captured by both
Mary Kaldor and Jacques Gansler . Technical design and inno-
vation in civilian industry has at least to pay attention to produc-
tion processes as well as to the characteristics of the product . In
military industry, design and innovation is focused on the product
alone . Its destructiveness, speed, accuracy, or whatever, is the
key criterion . That is what the buyer wants, and such marginal
competition as exists between producers focuses on these charac-
teristics of their product . How the product is to be produced, and
what it costs to produce it, are strictly secondary considerations .
Indeed, as suggested above, the interest of the producing firm
actually lies in coming up with a product that is more difficult and
more expensive to produce . There is no effective institutional
mechanism forcing the kind of `rationalisation' of production
processes common in civilian industry .
One important consequence of this is that direct attempts
by firms to `convert' from military production to production for
capitalist markets have often gone badly wrong . Gansler (1982 :49)
writes that it can be `very difficult to convert engineering and
manufacturing forces to the lower-cost practices of the commer-
cial world' . Kaldor (1982a :42-49) describes in some detail the
problems faced by Vickers in attempting to turn to civilian
production during the periodic down-turns in twentieth-century
British military spending .

The law of value strikes back

Despite the considerable degree of insulation of weapons

production from the law of value, the indirect effects of that law
cannot be escaped here any more than they can be escaped in
other aspects of life within capitalism . Most obviously, the price
of weapons relative to civilian goods has shown a tendency to rise
sharply . One estimate (Gansler, 1982 :15) would suggest that the
cost of weapons is escalating on average at a rate 5% per annum
greater than the civilian rate of inflation, the compounded cumu-
lative effect of which is considerable, weapons doubling in relative
costs about every 14 years . Furthermore, in reality cost increases
are far from following smooth annual increments . One weapons
system tends to be replaced in a finite length of time by another
whose cost in real (constant £ or $) terms is sharply higher .
Two mechanisms account for this . One, of course, is the
 CAPITAL & CLASS

42 rising complexity of weapons, the result of the constant trend to

product `improvement' . Modern weapons are more destructive,
faster, more accurate, and so on, than their predecessors . But it is
far from clear that the resultant increases in military effectiveness
are commensurate to the increases in price required to purchase
them . The question is of course largely unanswerable - though
Kaldor (1982a) marshalls a compelling body of evidence that
increasing complexity implies greater vulnerability and liability
to breakdown, and thus in a significant sense decreasing military
effectiveness . But what is overwhelmingly clear is that with
military budgets until fairly recently relatively constant in real
terms, the numbers of weapons that could be bought has fallen
rapidly as the price of each individual weapon has risen . In the
1950s the United States military could buy 3,000 tactical aircraft
a year . By the 1960s that figure had fallen to 1,000 a year, and by
the 1970s to about 300 a year (Gansler, 1982 :17-21) .
The second mechanism involved has already been dis-
cussed at some length - the lack of any real incentive to cost
reduction in weapons production . Investment in defence plant
and equipment by firms is low, `around 50 percent less [than]
that being made by other comparable sectors of American in-
dustry' (Gansler, 1982 :58), partly because of the availability of
often old, but free, government plant and equipment . While
civilian producers have often been able to -indeed in a sense have
had to - improve products while reducing real costs (colour
televisions typically cost less in real terms than black-and-white
ones did fifteen years previously), weapons producers have
markedly failed to do so, even where quite similar electronic
technologies are involved (Gansler, 1982 : 15-21) . Excessive costs
and waste in the weapons industry have of course been complained
about for decades by those concerned to get `more bang for the
buck', but the resultant reforms have had no more than marginal
effects . The causes of these phenomena are rooted in the insti-
tutional structure of the weapons-production system .
One major change has, however, taken place in that struc-
ture in the last fifteen or so years . The single buyer situation
characteristic of weapons production until the mid-1960s has
been dramatically replaced by an accelerating trend to multiple
buyers and the emergence of at least the beginnings of an inter-
national market in weapons . This market involves not only rela-
tively simple weapons such as rifles (where indeed a market
existed well before the 1960s) but also the most highly sophisti-
cated weapons systems .
The heart of this trend has been in the changing nature of
arms transfers to the Third World . Up to the early 1960s, that
transfer consisted largely of military `aid' given by the Soviet


MILITARISM AND THEORY

Union or (predominantly) the United States, and took the form 43

mainly of second-hand or obsolete weapons . But more recently
Third World countries have been buying weapons, buying them
in ever-increasing quantities, and seeking to buy the `best' that
money can buy .
The impact of this trend has been marked . The leading
British weapons producer, British Aerospace, now depends on
export markets . Two-thirds of its military aircraft sales and half
its missile sales are abroad, with the Third World being as
important as Europe and the USA as a market (Counter Infor-
mation Services, 1982 :19) . In the depths of the trough of us
military spending between Vietnam and the new Cold War, more
than half American military aircraft and missile production was
for foreign sales (Gansler, 1982 ; 26) .
Exactly what kind of market in arms is emerging inter-
nationally is unclear . Prices are `largely determined by a process
of political bargaining' between states (Kaldor, 1982b : 271), and
far from forcing production costs down there is evidence that
exports can be `significantly inflated' in price (Gansler, 1982 : 89) .
Third World states are prepared to, and often want to, buy the
most `advanced' technology - even when this has been proved
militarily ineffective in Third World conditions - and so the
`product improvement' dynamic is largely unchallenged .
Nevertheless, it seems to me unlikely that in the long run
the only effect of the emergence of the market on the weapons
production system will be to reinforce its existing characteristics
and support it where it might otherwise have collapsed . Orient-
ation to the world market must surely give rise to attempts to hold
down costs, to `rationalise' production and possibly even to test
the marketability of simpler and cheaper products . Already there
has been conflict between the Navy and British Shipbuilders over
the design of the new 'Type-23' frigate . The Navy wanted an
advanced, ultra-sophisticated frigate ; British Shipbuilders a
somewhat more basic, cheaper frigate that, they believed, might
generate larger Third World sales (The Scotsman, 10 February
1982) .

The weapons-production system is both massive - it employs Is the

perhaps a third of all scientists and engineers in the Unted States, weapons-
and about a tenth of all production workers'- and highly resistant production
to fundamental institutional change . Furthermore, it is tightly system
linked by personal contact and overlapping (though not identical) the cause of
interests to the military users of weapons, a linking that has led militarism?
many to speak of the 'military-industrial complex' . This complex
has powerful means at its command for influencing state policy .
 CAPITAL & CLASS

44 It monopolises the sources of information about military matters,

and so can play a part in generating `scares' such as the `missile
gap' . Those beholden to it are often to be found in high office,
and it can and does lobby and bribe . Congressional or parlia-
mentary representatives concerned about the economies of, and
employment in, their localities have a powerful incentive to
support weapons producers with factories there .
Considerations like these suggest that the weapons-
production system, or the military-industrial complex as a whole,
might be in some sense the cause of militarism . Thus Mary
Kaldor writes (1982b : 274) that `the permanent arms race, at
least on the western side . . . can be explained entirely without
reference of an opponent' . EP Thompson argues that `the USA and
the USSR do not have military-industrial complexes : they are such
complexes' . 'Exterminism', as he describes it, has its own internal
dynamic and logic . `Weapons innovation is self-generating' .
Exterminism has as its `institutional base . . . the weapons system,
and the entire economic, scientific, political and ideological
support-system to that weapons-system - the social system which
researches it, "chooses" it, produces it, polices it, justifies it, and
maintains it in being' (Thompson, 1980 : 23, 8 and 22) .
Certainly there is an impetus to the weapons-production
system that is relatively impervious to its surroundings . The time
scales of weapons production and of politics are quite different .
Political crises can develop in a matter of months or less, and the
international climate shifted from detente to renewed Cold War
in less than three years . When weapons take a decade or longer
from initial research and development to final assembly, we can
see why their production cycles are not, and cannot be, closely
tied to the immediate political situation .
In addition, what Kurth (1973) calls the follow-on impera-
tive is a powerful factor . He identified nine major aerospace
production facilities in the United States - those of General
Dynamics, North American Rockwell, Boeing, Lockheed
Missiles and Space, Lockheed Georgia, McDonnell-Douglas
Missouri, McDonnell-Douglas California and Ling-Temco-
Vought . These facilities were kept in virtually continuous pro-
duction in the years Kurth studied (1960 to 1973) . As one major
product was finished, a new, similar but more advanced project
was phased in, usually within a year . The history of Lockheed
Missiles and Space in California is typical . From 1960-68 it
produced Polaris missiles . As Polaris production was phased out,
Poseidon was phased in . Before Poseidon production ended,
work on Trident I began . Now, of course, preparations are being
made for Trident II . The factories of destruction cannot be
allowed to lie idle ; that is the follow-on imperative .
 MILITARISM AND THEORY

Follow-on is not simply a matter of profit-seeking by 45

weapons producers ; indeed follow-on is perhaps most clearly to
be seen in the Soviet Union, where profit is not a motive at all
(Holloway, 1980 : 144-45) . For a state apparatus committed to
militarism, a major weapons-production plant is a national re-
source not to be jeopardised by failure to follow-on . Consider the
£1 billion Chevaline alterations to the Polaris warhead . Without
Chevaline, pursued in secret for virtually a decade before it was
announced to Parliament, the Ministry of Defence Atomic
Weapons Research Establishment at Aldermaston would simply
not have had enough to do . And for the past seven years - well
ahead of the official 'decision'- work has gone on at Aldermaston
on the design of a warhead to fit Trident (Counter Information
Services, 1982 :3) .
Despite these very real considerations, however, I am not
convinced that an inertial impetus or internal logic deriving from
the weapons production system is sufficient to explain militarism .
The military-industrial complex is far from all-powerful . It faces
influencial opposition from within the ranks of capital (Lo, 1982) .
It is by no means clear that rising military spending is in the
economic interests of any other than weapons-producing capital-
ists (see the next section) . The long-term trend of Americian
military spending, measured in real dollars, was actually level
from the early 1950s to the mid 1970s, with rises - Korea, the
Kennedy administration, Vietnam - balanced by later falls . As a
percentage of gross national product, or of total government
expenditure, military spending fairly steadily fell . In the early
1950s military spending was equivalent to about 10% of us gross
national product ; by the mid 1970s, that figure had fallen to
around 5% .
Of course, since the mid '70s military spending in the
United States has shifted to a sharply rising trend line - the
Reagan Administration is currently trying to raise it by 8% per
annum in real terms - though its NATO allies, with the partial
exception of Britain, have avoided doing likewise . But whatever
explanation one constructs for this - domestic political circum-
stances, the crisis, the changing world balance-it clearly involves
factors outside the military production system . There is no
plausible evidence that the military-industrial complex, on its
own, has the capacity to achieve such dramatic shifts in state
policy . Indeed, it would appear that much of the influencing,
bribing and lobbying work of both arms producers and the
armed services has had to do with trying to maintain or alter the
division of a more-or-less predetermined defence `cake', rather
than with trying to increase the overall size of that cake .
In no sense does this prove that the weapons-production
 CAPITAL & CLASS

46 system or military-industrial complex are without power. But

they do not have absolute power or, on their own, even predomin-
ant power ; to assume that is, indeed, to foreclose the very in-
teresting empirical and theoretical issue of the nature and sources
of that power . My own guess is that study of this will reveal that
their power is real but exists in interaction with wider structures,
particularly (to jump ahead in my argument) the state and the
international system of states . The military-industrial complex is
certainly not the neutral instrument of the state or capital as a
whole, but neither is it their straightforward master .

Economic `Orthodox' Marxist analysis of militarism has indeed typically

explanations rejected the theory of the military-industrial complex as the
of militarism explanation of militarism . Instead, it is argued that militarism is
economically functional for capitalism as a whole, and not just for
those capitalists that produce weapons . Economic explanation is
indeed what is generally held to characterise Marxist accounts of
militarism . For example, Quincy Wright in his mammoth A
Study of War subsumes `the Marxian theory' under the topic of
`the economic motive' for war (1942/65 :284) .
Basic to such explanations of militarism is the assertion
that militarism contributes to the accumulation of capital . There
are two strands to this assertion, which are sometimes combined
but more usually separate . The first strand is the claim that
military spending is, in itself, beneficial to capitalism . The second
strand is the claim that militarism benefits capitalism (or, at least,
particular national capitalisms) by permitting economic gains
abroad .

The Permanent Arms Economy

Ever since the publication of Rosa Luxemburg's The

Accumulation of Capital (1913/51) the economic effects of arms
spending have been controversial within Marxist economics . In
chapter 32 of that book Luxemburg argued that `from the purely
economic point of view' militarism contributed directly to the
accumulation of capital . Marxist writers after 1945 often agreed .
Before their eyes they saw both an historically unprecedent
capitalist boom and an historically unprecedented level of'peace-
time' arms spending . That the two were connected seemed a
plausible inference . Most notably, Vance (1951/70), Baran and
Sweezy (1968) and Kidron (1970) argued that post-war arms
spending stabilised capitalism . That theory, especially as pro-
posed by Kidron, became popularly known as the theory of the
permanent arms economy, and was adopted as the official position
 MILITARISM AND THEORY

of the International Socialism group (now Socialist Workers 47

Party) .
It might well be better, though, to speak of permanent
arms economy theories, rather than theory, as different pro-
ponents of the position believed in different, and sometimes
incompatible, accounts of the effects of arms spending . At the
price of gross oversimplification, however, it is possible to isolate
out three main economic `benefits' of arms spending that were
claimed .
First, arms spending stimulated technical innovation,
which diffused into the civilian economy as `spinoff .. This was an
argument particularly associated with Ernest Mandel (e .g .
Mandel, 1975 : 274-309) . Second, arms spending stimulated total
demand in the economy, alleviating potential problems of
'under-consumption' (see, especially, Baran and Sweezy, 1968) .
Thirdly, arms spending slowed the tendency of the rate of profit
to fall by siphoning off surplus value that would otherwise contri-
bute to over-investment in constant capital .' This last argument
was the distinctive contribution of Kidron .
The theory of the permanent arms economy has fallen out
of favour quite dramatically in recent years . It has been argued
against empirically . Szymanski (1973) and Ron Smith (1977)
have shown that on the whole capitalist countries with high levels
of arms spending have performed worse economically than those
that spend little on arms . But this is hardly the only reason for the
theory's fall from favour - indeed the more sophisticated pro-
ponents of the theory were well aware of the overall effect pointed
to by Szymanski and Smith, even if they were unaware of the
detailed correlations they reveal .
Rather, what has changed is the capitalist world . We now
face not boom plus arms spending but recession plus arms spend-
ing . It is no longer intuitively plausible to believe that arms
spending benefits capitalist economies . Indeed it seems politically
dangerous to believe it . If it were true, then maybe Thatcher's
Britain or Reagan's United States really could spend their way
militarily out of recession .
It would be tempting to conclude that the theory of the
permanent arms economy is simply false, and that arms expendi-
ture is unequivocally detrimental to capitalist economies . R But to
my mind that would be mistaken, and would forget the genuine
insights contained by the theory of the permanet arms economy .
Rather, we should seek to place those insights in historical context,
to realise their historically limited nature, and to accept that there
may be no single `effect' of arms spending, but different effects in
different historical phases .
While this is dangerous terrain for someone who is not an
 CAPITAL & CLASS

48 economist to venture onto, I would speculate that one can identify

a very real difference in this respect between, on the one hand,
the late 1940s, the 1950s and perhaps early 1960s, and, on the
other, the present . The former period is the one whose experience
is crystallised in the theory of the permanent arms economy . In
it, `spinoffwas clear and obvious . The civil jet aircraft industry
was crucially dependent on military planes . Solid state electronics
- the transistor and the like - was almost completely dependent
on military funding and military purchases in its early years
(Braun and MacDonald, 1978) . Civil nuclear power arose directly
from the military use of nuclear energy . The first British nuclear
power stations were little more than plutonium factories that
produced electricity as a by-product ; the key United States
commercial reactor design (the Pressurised Water Reactor, as in
Three Mile Island) can be traced back directly to the reactors of
nuclear submarines (Durie and Edwards, 1982 ; Kevles, n .d .) .
Numerically controlled machine tools were invented for military
production, and their development carefully nurtured by the
United States military (Noble, 1978) .
Similarly with the demand-boosting effects of military
spending . In the late 1940s and 1950s, United States capitalism
enjoyed unquestioned world dominance . Recession could be
warded off by boosting demand at home through military spend-
ing and sustaining the buying power of Western Europe through
Marshall Aid and `defense support' economic aid (Kolko and
Kolko, 1972) . Such was the us dominance that it scarcely
mattered that national capitalisms with low military spending,
especially Germany and Japan, could enjoy the benefits of this
without bearing the costs .' Further, if there is any period in
which siphoning off surplus value has been beneficial, then this is
surely the most plausible candidate, being a period in which
capitalist growth proceeded relatively smoothly and without a
major crisis even potentially attributable to over-accumulation .
The situation in the 1980s is more complex . Spin-off from
military technology is no longer obvious . That should not lead us
- as it has led some commentators - into assuming that it no
longer exists . But its nature has changed . Kaldor (1982a) and
Rothschild (1980) are right to point to the increasingly specialised
and `baroque' nature of military hardware - of tanks, missiles
and planes . No civilian analogues of the MX missile or of the
Multi-Role Combat Aircraft Tornado will ever be marketed . The
area of major potential spin-off is rather the very large-scale
electronic command, control and communications systems within
which military hardware is now inserted - computer networks,
satellite communications and the like . These are very important
to contemporary capitalism : multinationals, for example, are
 MILITARISM AND THEORY

increasingly using the civil analogues of world-wide command, 49

control and communications networks to organise production on
a world scale . It remains quite unclear, however, whether these
technologies can in any sense form the foundation of a renewed
wave of capital accumulation .'°
Demand boosting through military spending is perhaps
the area where the effects of changed circumstances are clearest .
The interconnection of capitalism as an economic system has
grown, while us economic dominance has been replaced by the
three separate poles of America, Europe and Japan . The Vietnam
boom in us military spending perhaps marks the turning-point .
That weakened the relative position of the United States in the
international capitalist economy, and arguably played an impor-
tant part in destablising that economy as a whole . It is clearly a
matter of major concern to the present us administration that its
allies have been, and may continue to be lagging behind it in
boosting military spending . While it still too early to tell, the
present spending boom seems likely to weaken even further the
United States' competitive position .

The economic effects of arms spending, then, are complex

and historically variable . A further difficulty arises if we draw on
those claimed effects to explain militarism functionally . For even
if the effects of military spending were unequivocally beneficial
to capitalist economies, we would still have to prove that only
military spending, rather than any other form of state spending,
could have these beneficial functions . Why not spending on
hospitals or schools, or massively expensive `pure science' pro-
jects, or the Keynesian digging and filling in again of holes?
Where the proponents of the permanent arms economy have
touched on this problem, they have either shifted their ground

C & C 19 - n
 CAPITAL & CLASS

50 (claiming other, quite separate, benefits to capital from militar-

ism, as do Baran and Sweezy, 1968), or they have argued that
what is unique about military spending is that one country doing
it forces other countries to do it (Kidron, 19870 : 56-61) . But the
latter argument is not convincing, because this effect precisely
fails to operate where it most needs to, if international capitalism
is to be stabilised : i .e . between capitalist `allies' .

Imperialism

The permanent arms economy is a relative newcomer

amongst economic explanations of militarism . The classic
economic explanation of militarism is that of the theory of im-
perialism : militarism makes possible external economic gains .
Historically, these gains have included straight forward booty
and colonial tribute . In the epoch of capitalism they are typically
access to markets, to raw materials, and to opportunities for
profitable investment . In a world of competing imperialisms,
militarism becomes a necessity . Economic `interests' abroad have
to be defended, not only against indigenous peoples, but against
competing imperialist powers .
Such was the economic core of the explanation of the
Marxists of Lenin's generation for the capitalist militarism of
their period .'' To apply it to the post-1945 world has necessitated
some modifications, but the essence of the theory has stayed the
same . Rivalry between capitalist imperialisms has become less
important, and repression of anti-imperialist struggles more so .
And the emergence of the Soviet bloc has had to be taken account
of, whether it is seen as the growth of a rival, somewhat different,
imperialism, or as the development of a pole of support, however
reluctant, for anti-imperialist movements .
The problems of economic imperialism explanations arise
most immediately when applied to particular uses of military
force . Undoubtedly there have been some instances where the
use of force has been subject to conscious calculations of economic
profit and loss . Eighteenth century British wars seem to have
been of that kind (Best, 1982 ; 30 and 91) . But those are scarcely
typical .
Take the Falklands War as an example . The costs of
British military action far outweigh any British economic 'in-
terests' in the Falkland Islands . The total sales (let alone profits)
of the Falkland Islands Company in 1981 were a mere £3 million
(Revolutionary Communist Party, 1982 : 18) ; the total financial
cost of the war will be many hundred times that . Reserves of oil
have also been mentioned, but the outcome of the war, an
outcome obviously desired by the Thatcher government, is pre-
 MILITARISM AND THEORY

cisely an outcome that will prevent any commercial exploitation 51

of these . No oil company is going to invest in oil rigs off the
Malvinas until there is a permanent settlement and no threat of a
resumption of hostilities .
Much the same could be said of a much more major
instance of military intervention, the United States involvement
in Vietnam . There, again, the total costs of military action far
outweighed the likely economic gains from Vietnam, or even
South-East Asia as a whole, to United States capitalism .
Of course, it can be argued that actions such as the
Falklands or Vietnam defend not simply one set of investments
or markets but a national capitalism's total overseas economic
interests (see, for example, Socialist Challenge, 4 June 1982 : 2, re
the Falklands) . If one attack on these interests succeeded, other
attacks would be encouraged .
Yet even this generalisation of the theory is dubious . The
costs of militarism are so huge that they can quite possibly exceed
even the returns on total, worldwide overseas investment .
Harman (1982 : 49) claims that `at no stage in the 1940s or 1950s
did total us overseas investment (let alone the much smaller
return on that investment) exceed us spending on arms' . By the
early 1980s overseas investment was certainly much greater, but
military spending was `still substantially more than the profits
that could possibly accrue from that investment' .

Not just economics

Does this mean that we are forced to conclude that con-

temporary capitalist militarism is indeed irrational, even in
capitalist terms? Does it, for example, override my earlier reser-
vations and force us to accept an `internal logic' explanation of
militarism?
I think not, and the reason has to do with the basic way
capital and capital accumulation are conceived both by the theory
of the permanent arms economy and by conventional imperialism
theory . Both theories tend to conceive of their subject matter in
highly economistic terms . But capital is not just a sum of money
or of commodities . It is a'social relation between persons' (Capital
1 : 932) . Economics, narrowly conceived, can never give a full
account of the capital relation, because that relation is a matter of
law, the state and culture as well as economics . Law and the state,
because the capital relation is by definition a relation between two
different kinds of `commodity owners' (Capital 1 : 874), capitalists
and `free workers, the sellers of their own labour-power' . Culture,
because the creation of the capital relation is simultaneously the
attempt to create a whole new set of attitudes, beliefs and social
 CAPITAL & CLASS

52 practices, as EP Thompson emphasises in his discussion of

capitalism and time (Thompson, 1967) .
Maintaining or extending the capital relation is thus never
simply a matter of economics . Nor is it a matter primarily of
economics and then only secondarily ('superstructurally') of the
state, politics and culture . For if recent Marxist theory of the
state carries any message, it is that it is quite mistaken to see
Marxist theory as explaining politics in terms of'economics .
Rather, the state has to be seen as an integral part of the capitalist
mode of production, and the very separation of politics and
economics a creation of that mode of production .
Economistic imperialism theory is wrong, then, to assume
that the, competition between states is necessarily at root eco-
nomic, and that political, cultural or military competition are
derivative and to be judged as irrational or not according to the
weight of the `basic' economic issues involved . When the British
Government talks of resisting `aggression' in the Falklands, or of
defending British `sovereignty' (Foreign and Commonwealth
Office, 1982), we need not assume that these words merely
rationalise economic calculation . Certainly we can translate these
words into other terms . Resisting aggression means that underdog
violators of the international status quo will not go unpunished .
Defending sovereignty means that the authority of the British
state will not be tampered with lightly . What was being punished
in the Malvinas was an offence against the British state, against
the system of states, and against Britain's claimed place in that
system .
So the problem may lie not with the explanation of militar-
ism in terms of imperialism, but rather with economistic con-
ceptions of imperialism . In recent years some theorists have
formulated sharply their dissatisfaction with these . Thus Aglietta:
`Imperialism is typically seen in a reductive economistic perspec-
tive that distorts its significance . There is hardly a domain in
which unswerving fidelity to Lenin has been more damaging'
(1979 : 29) .
Certainly, detailed historical discussions of particular in-
stances of imperialism rapidly show the inadequacies of econom-
ism . Perhaps the most revealing of those instances from this point
of view is that of us foreign policy in the 1940s and 1950s . For it is
at least arguable that in this case a powerful policy-making elite
attempted to shape us diplomacy and military activity with
consciously economic goals in mind - the international free
circulation of capital and commodities, the stabilisation of the
world financial situation and open markets for American exports .
Yet what emerges from Kolko and Kolko's mammoth account of
this history (1972) is that in actual practice those economic goals
 MILITARISM AND THEORY

became totally enmeshed in attempts to reform, shore up or 53

recreate an entire social system threatened by collapse and rebel-
lion . In those attempts economic considerations had as often as
not to be subordinated to political, ideological and military ones,
and the lot given a quite spurious coherence as'anti-communism' .
Indeed those who did try to submit policy to considerations of
cost-effectiveness seem to have ended up as its opponents, even
as isolationists . 12

Contradictions of imperialist policy

`Imperialism', suggests Aglietta (1979 :30), `can only be

grasped on the basis of a fully developed theory of the state' .
While we might wish to add, `and not just that . . .', the point is
well taken . If nothing else, thinking about imperialism in relation
to theories of the state should warn us against overestimating the
coherence of imperialist policy, against trying over-
rationalistically to deduce the `real strategy' underlying diverse
acts of policy (a very common risk in many Marxist accounts) .
For as Hirsch (1978, 101) warns us, the state cannot resolve the
contradictions of capital . They have a nasty habit of reappearing,
even within the state apparatus itself . The `needs' of capital are
not unitary, but contradictory . Measures taken to fulfil one
`need' tend to intensify problems in other areas, and often fail to
achieve even their supposed purpose .
Thus when Davis (1982 :58) looks at Reagan's `deeply
reasoned' strategy, he notes, amongst other things, that `as inter-
imperialist economic competition reaches a post-war height, the
New Cold War provides an invaluable framework for reimposing
Western "unity" and American hegemony' . He is not alone in
this claim : Dan Smith and Ron Smith gave precisely the same
estimate of the New Cold War's `function' in the pages of Capital
and Class two years previously (1980/1 : especially 41) . Yet that is
precisely what the `New Cold War' hasfailed to do . The resistance
evoked by the Cruise and Pershing decisions has been one factor ;
so have the strains within the West brought on by high American
interest rates, themselves in part caused by the booming defence
budget . The Reagan administration's attempt to scupper the gas
pipeline between Siberia and Western Europe because of the
strategic risks it saw in the scheme came close to provoking one of
the most serious trans-Atlantic crises yet .
While Davis, Smith and Smith may well be correct in their
assessment of the intentions of Washington, the actual outcome of
those intentions has been very different . That is perhaps a general
phenomenon from which we should take heart . Our opponents
(even if we think of them as abstractly as `imperialism') are
 CAPITAL & CLASS

54 neither all-knowing nor all-powerful . Our image of them should

not be of the chess-player, rationally evaluating a situation and
choosing a clearly objectively best move . Rather, they are in the
situation of someone trying to force a hopelessly ill-fitting lid onto
a tin of paint . The more they try to push it down on one side, the
more it bulges up on the other.

Militarism and The connections between militarism and the state are indeed so
the State intimate that it is worth approaching them directly, rather than
through the detour of even a revitalised theory of imperialism .
For several centuries war and its preparation have overwhelm-
ingly been the concern of states, and not of other forms of social
organisation . The history of the modern form of state and the
modern form of militarism are deeply interwoven .

The State and violence

Max Weber went as far as to define the modern state in

terms of violence and coercion . Speaking at Munich University
in 1918, he argued that `today . . . we have to say that a state is a
human community that (successfully) claims the monopoly of the
legitimate use of physical force within a given territory' (1918/1970 :
78) .
Marxist state theory has not put the matter quite as starkly
as that . Nevertheless, recent Marxist theorists have placed great
weight on the notion that the capitalist state comes into being
through the taking away of relations of force from the immediate
process of production and their placing in a body separate form
that process . In feudalism, the use of force was diffused through
the entire society . Force could be directly employed by feudal
lords to extract surplus from their peasantry . Under capitalism,
surplus is extracted by `economic' processes ; the policeman and
the soldier are not normally found inside the factory . Coercion is
thus at one remove from the process of production . It needs to be
there - otherwise there can be no guarantee that the `economic'
rules of the game will be adhered to - but it can be kept as a last
resort . Unlike feudal production, capitalist production is quite
compatible with formal legal equality between exploiter and
exploited as commodity owners, and with the state as standing
above both, as sole locus of `the legitmate use of physical force' ."
Historically, then, there is a close parallel between the
emergence of the state as separate from society and the concen-
tration of legitimate violence in a specialised body, the military .
The state and concentrated, organised violence are more than
`just good friends' . Yet despite the overall insight into necessity of
 MILITARISM AND THEORY

the connection offered by Marxist theories of the state, the 55

connection itself remains little discussed and elaborated . It re-
ceives, for example, scarcely any attention in Holloway and
Picciotto (eds) (1978), and little more than scattered insights in
Urry (1981) or Jessop (1982) .
From the point of view of understanding militarism that is
a great pity . For in several vital ways state theory could have a lot
to contribute to the understanding of militarism .

Internal order, the state and militarism Prague 1968 :

Russian tanks
The use of force as the guarantee of order may be a last crash popular
unrest
resort for capitalist societies, but it is nevertheless resorted to
moderately often . The military can be used to repress unrest
within a continuing framework of `liberal democracy' ; it may of
course also supplant that framework and replace it with some
form of military rule . Internal repression is a major activity of
most armed forces . Indeed there are some armed forces for which
it is the major military activity . The armies of Latin America, for
example, have seen much more of this than they have of war
between states .
 CAPITAL & CLASS

56 Although straightforward repression is crucial, practically

and theoretically, the relationship between militarism, the state
and order does not end there ." Power, as Foucault emphasises,
is not merely negative and repressing - power actually creates
order, rather than merely maintains it . The modern state is by no
means simply a body that maintains order through the punish-
ment of violations . It creats order by, for example, constituting
its subjects as citizens, individual bearers of political and legal
rights and responsibilities ."
`Soldier' and `civilian' may be opposites . `Soldier' and
`citizen' are not . From Ancient Rome and Sparta, through the
city-states of the Middle Ages to modern capitalist nations, the
connections between the two categories have been close - al-
though, of course, the nature of both soldiering and citizenship
has altered radically . To gain some insight into the nature of the
modern connection, it is perhaps worth a digression to consider
armed forces where that connection was lacking .
The armed forces of both eighteenth-century Britain and
the contemporary Continental absolutisms seem strange indeed
to modern eyes . They were national in only a very weak sense .
Recruitment to them was often from abroad : half the Prussian
army, for example, was non-Prussian . Many foreigners were
recruited from amongst enemy prisoners of war ; others were
various forms of mercenary . The non-foreigners were largely
coerced, either through press-gangs or as an alternative to prison
or the gallows . The aristocratic officers of these armed forces
were an `international elite with transnational interests' . `Nothing
ill was thought in the professional military world of moving from
one sovereign's service to another, as opportunity and career-
prospects offered .' (Best, 1982 : 32 and 27-28 ; see also Engels,
1878/1976 : 214) .
Such armies were extremely constrained in the way they
fought by their social composition . Their commanders feared
desertion by their own men as much or more than they feared
defeat at the hands of the enemy . They often dared fight only in
tightly restricted formation, in daylight and on flat open ground .
Hills, woods, marching by night, free-ranging patrols and skir-
mishing - all these opened too many opportunities to men who
could not be trusted . Frederick of Prussia, the virtuoso of such
militarism, knew it to be necessary to make his soldiers fear their
own officers more than they feared the enemy ; discipline in his
army was `famously ferocious' (Best, 1982 : 32) .
The armed forces of the French revolution broke radically
with this pattern . `A force appeared', wrote Carl von Clausewitz,
, that beggared all imagination . Suddenly war again became the
business of the people - a people of thirty millions, all of whom
 MILITARISM AND THEORY

considered themselves to be citizens' (Clausewitz, 1832/1976 : 57

591-2 ; quoted by Best, 1982 : 63) . After the revolutionary army
defeated the Prussians at Valmy in 1792, 'Goethe ended the day
sitting with some Prussian soldiers around what would in better
weather have been a camp fire . . . "At last, someone asked me
what I though about it all . . . I said : From this place and from this
day begins a new era in the history of the world, and you will be
able to say, I was there"' (Best, 1982 : 81) .
Armies of citizen-soldiers were different from the mercen-
ary armies of the preceding century, although some reforms were
already on the way before the French Revolution . Discipline
could be less brutal, and a greater freedom of military action
achieved . But we need to be very careful of the kind of roman-
ticism to be found in Engels (1878/1976 : 214) about the military
virtues of those `fighting for their own interests' . Battle is a brutal
and terrible experience and modern states have not relied on
either ideology or material interests to sustain their soldiers' will
to fight . Coercion, John Keegan reminds us (1978 : 330), remains
central to armies, and desertion may well have been reduced less
by commitment to a cause than by the fact that on a modern
battlefield - defoliated and many miles deep - there is simply
nowhere to desert to . 16
The true significance of the citizen soldiers arguably lies
outside the conduct of battle, and has to do with the provision of
people and finance for war . Partly it has to do with consent .
These necessaries are more easily found from a willing population
- though again we should be wary of assuming that general
approval of a war or of a state's armed forces translates into
readiness to join up or to pay . Perhaps more significantly, mass
citizen armies imply a different institutional relationship of the
person to the state than did the eighteenth-century mercenary
armies . Obviously, a citizen army requires citizens ; if they do not
volunteer themselves in sufficient numbers, they have to be
conscripted, and this, minimally, requires a state to know who its
citizen's are, how many of them there are, and where to find
them . Citizens need to be named and numbered, too, not just as
potential conscripts but also as taxpayers . Ad hoc, inefficient and
corrupt tax-gathering machinery has to be replaced by as efficient
and universal a system as possible .
Thus the relationsip between the creation of `modern'
armies and the creation of `modern' states is far from accidental .
Both, too, are closely interwoven with the creation of the `nation',
for the modern army is of course a national army, and the modern
state predominantly a nation state (rather than, say, the ram-
shackle multinational Austro-Hungarian Empire) . This state of
affairs is now so much taken for granted that it is easy to forget it
 CAPITAL & CLASS

58 is a creation less than two centuries old . It is perhaps again worth

reminding ourselves, this time in the words of Clausewitz - who
lived through the change - of how different things were
previously :
Armies were paid for from the treasury, which rulers
treated almost as their privy purse or at least as the property
of the government, not of the people . Apart from a few
commercial matters, relations with other states did not
concern the people but only the treasury or the govern-
ment . . . A government behaved as though it owned and
managed a great estate that it constantly endeavoured to
enlarge - an effort in which the inhabitants were not
expected to show any particular interest . . . War thus
became solely the concern of government . . . Their [gov-
ernments'] means of waging war came to consist of the
money in their coffers and of such idle vagabonds as they
could lay their hands on either at home or abroad .
(Clausewitz, 1832/1976 : 589)
The creation of the potent modern mix of militarism,
citizenship, the nation and the modern state was not instan-
taneous . It was `exported' by Napoleonic France, as its defeated
rivals, such as Prussia, found that they themselves had to resort
to similar institutional changes to compete militarily . The arch-
conservative Prussian state raised something quite like a people's
militia - previously a liberal, even revolutionary, demand - to
combat Napoleon . Though it promptly retreated from the notion
once the immediate danger was past, the connection between
institutional reform and military necessity was to reappear . Thus
Bismarck wrote in his memoirs : `The acceptance of general
suffrage was a weapon in the struggle against Austria and the rest
of the foreign powers' (quoted by Therborn, 1977 : 22) .
Indeed Therborn finds from his survey of the major bour-
geois democracies that `national mobilisation in the face of ex-
ternal threat has been a most important factor in the history of
bourgeois democratization' (1977 : 23) . Time and time again
extensions of the rights (and, let it be said, duties) of citizenship
have coincided with military emergencies and the need to collect
as much as possible of the human, financial and physical means of
war . And from the time of Bismarck onwards, war and the
preparation of war have been vitally important in the gradual
widening of the meaning of citizenship as the citizen came into
relation to the state not merely as legal subject, voter and tax-
payer but also as welfare recipient, patient and parent . `Modern
war', said Titmuss (1958, 86), `has had . . . a profound influence
on social policy' - a statement which recent historians of the
welfare state have amply confirmed ."
 MILITARISM AND THEORY

Gender, militarism and the state 59

A crucial proviso is however in order here, one on which

books like Best (1982) tend to remain silent . The institutional
changes associated with national mobilisation have been markedly
different for women and men . The nineteenth century citizen-
soldier was a man . Although women have fought in popular
uprisings and guerrilla wars, it has been the almost universal
practice of states to exclude women from combat . Again, this is
something so much part of our taken-for-granted world that it is
only very recently that it has typically been thought worthy of
comment .
One issue intimately connected to this is the use of physical
coercion in relations between men and women . For it is not true,
despite Weber's claim, that the state seeks to monopolise all
physical force . As the burgeoning literature on domestic violence
has shown, a `private sphere' of accepted physical force has
typically been left to men by modern states . Even rape is treated
quite differently, in practice, from other violent crime . Feminist
pressure may have had some successes in this sphere in recent
years, but it is surely misleading to claim, as does Randall Collins,
that women `gained [an] ally in the modern state' (1975 : 246) .
It is difficult to judge just how important is men's exclusive
involvement in military force for their capacity to coerce women
at the individual level . That women are denied access to, and at
least some men given access to, the physical and mental `skills' of
violence must, at the very least, reinforce existing patterns . What
has been at least as important - and unlike this last point, an area
of active feminist campaigning for a century or more - has been
the unequal nature of the `citizenship' associated with the mil-
itarised nation-state . Until recently, the state taxed its male sub-
jects (see Bradby, 1982 : 126-7), conscripted its male subjects,
and correspondingly granted the full status of citizen only to
these .
As the inequalities of political and legal citizenship have
declined, so those of what Marshall (1963) calls `social' citizenship
have become more salient . Here too militarism is central . For if
militarism wishes the man to be a soldier, so it wishes the woman
to be the mother of fit and healthy soldiers . Nira Yuval-Davis is
describing contemporary Israel, but her words have wider appli-
cation (see, for example, Davin, 1978) :
women have another national military function perceived
as primary to them . That primary function is motherhood
- women as national reproducers of the future military
force . . . It has been a common reaction in Israel, when
greeting a pregnant woman, to say, `Congratulations! I see
 CAPITAL & CLASS

60 you are soon to bring a small soldier into the world' (Yuval-
Davis, 1981 : 77)
So while militarism's exaltation of motherhood has brought
some gains in welfare provision, it has been at the cost of a
crystallisation, in the form of that state provision, of gender
stereotypes . Take for example the most famous of war-induced
welfare plans, the Beveridge Report :
In the next thirty years housewives as Mothers have vital
work to do in ensuring the adequate continuance of the
British Race and of British ideals in the world . (quoted by
London-Edinburgh Weekend Return Group, 1980 : 68)
The family, and stereotypes of family relations, have been
central to militarism ever since the active involvement of the
population in war and its preparation began to be felt to be of
importance . The stereotypes of the fighting man protecting `his'
wife and children at home, and of the woman as comforter and
encourager of her soldier son, husband or lover, have been drawn
on frequently . That sexually stereotyped image was prominent in
media coverage of the Falklands War . It has been an image acted
out by both men and women - most famously in the First World
War, with women taunting men who had not joined up . Its more
subterranean reverse image - that women `cannot resist a uni-
form', that soldiers can expect sexual favours - has also been
employed as an inducement to recruitment .
These are all ways in which militarism has reinforced and
drawn on existing gender relations . Yet its effects have not been
straightforward . Most obviously, twentieth century total war
required the industrial mobilisation of women and the conse-
quent breakdown of carefully preserved gender hierarchies in the
workplace - though the effects of this proved temporary, and the
gender order was more-or-less successfully reimposed after 1918
and after 1945 . Very recently, too, there have been signs of
changes within armed forces . Pressure for equal opportunities
coincided with anxieties about `manpower', and have led to
concerted efforts throughout NATO to increase the recruitment of
women to the armed forces . In this situation it has proven
difficult to restrict women to their traditional military roles in
administration, nursing and communications . Clearly, feminists
have found women's recruitment, and the pressure for access to
combat roles, profoundly contradictory (Chapkis, ed ., 1981) .
1 am painfully aware that these remarks on gender scarcely
scratch the surface of the topic . They are in a sense simply a plea
for further work . The relations between patriarchy and capitalism
have received a great deal of theoretical attention in recent years .
Those between patriarchy and the militarist state are deserving of
no less .
 MILITARISM AND THEORY

61
The system of states

Another proviso about the relationship of militarism and

the state that can only be sketched, but is nevertheless important
also, has to do with the fact that it is misleading to talk of the state .
For, in reality, no such entity exists . Individual states exist not in
isolation but in the context of other states, as part of the system of
states . Marxist theory can help us understand militarism only if it
stops being theory of the state, and becomes a theory of states in
the plural . 1 I
The modern state system has not always existed . For most
of recorded history, large areas of the globe were `dominated by
an empire that considered itself essentially alone in the world as it
knew it' . In mediaeval Europe, both the Catholic Church and
Holy Roman Empire had sought such quasi-global authority
(Poggi, 1978 : 88-89) . The failure of those attempts left a continent
divided amongst a multiplicity of sovereign states . The Peace of
Westphalia (1648), ending the bloody and protracted Thirty
Years War, recognised formally that `the idea of an authority and
organisation above the sovereign states is no longer' (Leo Gross ;
quoted by Poggi, 1978 : 89) .
The sovereign state as part of the system of states has a dual
aspect : it simultaneously faces both inwards and outwards . This
duality is built into the very notion of sovereignty . It means both
that a state has exclusive rights of rule within its territory, and
that it is subordinate to no other rule outside it, that it has
`independence beyond its borders' (Hintze, 1906/1975 : 192) .
Militarism is directly and immediately tied up with the
system of states . War is typically war between sovereign states ;
most preparation of war has that type of war in mind . As discussed
in the section on economic explanations of militarism, it may on
occasion be the case that such conflicts have straightforward
economic causes, but that is unusual . Reductionist explanations
of conflicts and developments within the system of states do not
in general seem viable ." The system of states has to be taken
seriously as a topic to be analysed in its own right .
If the state system is not taken seriously, then major
problems will arise in trying to explain developments even within
one individual country . Some of those problems were pointed to
in the previous section, where the considerable influence of
inter-state conflict on the developing forms of states was dis-
cussed . Even to think of writing the history of the Prussian/
German state, say, without making this a central part of the
account, would be ridiculous . The continuity of the British state,
and Britain's freedom from dramatic impingements of the state
system such as foreign invasion, make the point easier to forget in
 CAPITAL & CLASS

62 Britain . But, if nothing else, the Falklands War reminds us of the

indelible stamp left on the British state by the fact that `Britain is
not just any capitalist society in general . It was for two centuries
the greatest of the capitalist powers and the first imperialist state
in the world' (Ross, 1982 : 122) .
Even revolution does not guarantee escape from the logic
of the system of states . Surveying the history of the French,
Russian and Chinese revolutions, Theda Skocpol points to the
significance of the system of states in both the coming about of
the revolution and the development of the post-revolutionary
state . `Classical Marxism', she concludes, `failed to foresee or
adequately explain the autonomous power, for good and ill, of
states as administrative and coercive machineries embedded in a
militarised states system' (Skocpol, 1977 : 292) .
This could easily begin to sound like a counsel of despair .
It is not intended as such . Rather, the point of focusing on the
system of states as central to militarism is to argue the need to
think in terms of the dismantling of that system . Here, some
recent Marxist state theory is helpful . In its focus on the form of
the state, it has shown that the state is not just a set of people, or a
set of organisations, but a way in which relations between people
are structured (London Edinburgh Weekend Return Group,
1980) . 20 Similarly, the state system is a way in which relations
between people are structured ('internationally') . It is not the
only way in which they could be structured . The concept of
working-class internationalism pointed (and still points, however
weakened it has become) to another way . But the state system
dominates, and `the global hold . . . of the state form of insti-
tutionalization of social relations reinforces existing antagonisms
and gives them the tremendous violence of a conflict of state
powers' (Aglietta, 1979 : 31) .
Dismantling the state system as a `form of institutionaliz-
ation of social relations' sounds utopian . Nevertheless, if it is seen
as a process rather than an endpoint the idea might still be useful .
For example, the idea suggests a distinction between two types of
action against militarism . On the one hand, some campaigns
against militarism run through the state system . 'Multilateralism'
as a strategy for disarmament most obviously does this, in its call
for negotiations between states to reduce armaments levels .
Reliance on the United Nations is similar, because of the way that
body tends simply to reproduce the state system, with its hier-
archies and conflicts, rather than to transcend it . During the
Falklands War, many socialists put forward the slogan 'Negoti-
ations through the United Nations' as an alternative to Tory
policy . At least in Scotland, that approach largely failed to gener-
ate and fuse opposition to the war-in large part, I feel, because of
 MILITARISM AND THEORY

the abstractness of its reliance on the state system - where more 63

direct anti-militarist approaches were much more successful ."
On the other hand, some campaigns against militarism
undermine the state system . That is where they build direct links
across borders, links that bypass states . An opportunity of this
kind was missed during the Falklands War when little was made
of the offer by the Argentinian trade union congress (not an
Argentinian state body, indeed oppositional) of direct talks with
the British labour movement over the Malvinas and the war .
While that would almost certainly not have altered the course of
events, such talks would have been important in giving flesh to a
genuine alternative to the state system form of international
relations . The movement against nuclear weapons - because it is
already an international movement, with some strands crossing
the East-West divide - will hopefully offer many openings for
initiatives that bypass the state system . Certianly it is to be hoped
that END, the European Nuclear Disarmament campaign, does
not come to see its job as somehow bringing European states
together to agree on disarmament .
Undermining the state system does not even need to begin
with across border links, although these obviously make it many
times more effective . Unilateral nuclear disarmament is a policy
against the logic imposed by the state system (unless, that is, it
simply becomes an argument that `we' could defend ourselves as
well or better without nuclear weapons) . Campaigning for uni-
lateral disarmament thus tends implicitly to be a protest against
the existing state form of international relations . If that protest
can be tied to the development of alternative forms, then the
dismantling of the state system might no longer seem quite so
distant .
A focus on the state system ties several other political
issues in to antimilitarism . Perhaps most important are those that
represent attempts to impose state boundaries on the free
movement of people and ideas . Immigration controls, nationality
laws and censorship - all these clearly have to be opposed by
those who oppose the state system . And however tempting argu-
ments for import controls may be, campaigns for them can
hardly do other than reinforce the logic of the state system .

Of course, one of the many factors that make the dismantling of Militarism
the state system difficult is the active loyalty that many people as culture
feel to `their country', to its state, and to its military activities .
We are only at the beginning, I feel, of unravelling the
sources of that loyalty . Clearly, it is a loyalty not merely dependent
on ideas . As outlined above, it is tied historically to changes in
 CAPITAL & CLASS

64 state forms, in actual material forms of social organisation . Yet

attitudes, beliefs, ideas and values - culture in a broad sense - are
also enormously important in its reproduction .
Typically, these attitudes and beliefs are rooted in a con-
structed and idealised past . Their persistence was dramatically
revealed by the Falklands War, which as Anthony Barnett's
essay demonstrates, was constructed in a forty-year old idiom
(Barnett, 1982) . The dominant imagery was of the Second World
War : Galtieri as Hitler, Thatcher as Churchill, San Carlos Bay as
the Normandy Beaches . Some images went back even further
than that, into an English22 past of Drake, Rayleigh and of
warships putting out to sea from Portsmouth . 23
Interrupting the `cultural reproduction' of militarism is
vitally important . Occasionally, there are clear focuses to be
found for such action . In contemporary Japan there have recently
been sharp conflicts beteen the peace movement and teachers'
union, on the one hand, and the government, on the other, over
the rewriting of school history texts . As part of its (and the
Reagan administration's) campaign to remilitarise Japan, the
government is seeking to whitewash past Japanese militarism ; at
the same time, several films are appearing glorifying Japan's role
in the Pacific war (The Guardian, 2 July 1982) . The difference
between Japan and British, unfortunately, is that in the latter
country cultural reproduction of militarism is so pervasive that it
is difficult in a similar way to isolate particular instances to
oppose .
In Britain, the distinctive problem is the cultural residue
of Britain's former paramount place in the system of states, and
the way that residue remains open to capture by right-wing
populism . As Stuart Hall, above all, has emphasised, Thatcher-
ism is a cultural, as well as an economic and political, project .
The family, race and law-and-order are drawn on in an attempt to
`ground neo-liberal policies directly in an appeal to "the people" ;
to root them in the essentialist categories of common sense
experience and practical moralism' . The Falklands War has
allowed Thatcher to add imperialist militarism to this heady
brew . `Gut patriotism . . . feeds off the disappointed hopes of the
present and the deep and unrequited traces of the past, imperial
splendour penetrated into the bone and marrow of the national
culture .' It is not enough, suggests Hall, simply to ignore this
culture, to hope, as many Labour politicians clearly do, that the
`Falklands factor' will dissipate and politics return quickly to
`normal' . For `an imperial metropolis cannot pretend its history
has not occurred' . We need to make `more modern thoughts . . .
grip the popular imagination, bite into the real experience of
people, and make a different kind of sense .' Yet the left lacks
 MILITARISM AND THEORY

both the sense of the importance of, and the tools for, such an 65
effort : `no national paper . . . no powerful journal of opinion, no
political education, no organic intellectual base from which to
engage popular consciousness, no alternative reading of popular
history to offer, no grip on the symbolism of popular democratic
struggle' (Hall, 1982 : 6-7) .
Sexism, too, is central to the cultural reproduction of
militarism . Albrecht-Heide (1981) describes well its role in gen-
erating the male bonding that is so crucial to functioning armies ."
In the world of barracks and the field, men who do not conform
to military expectation are labelled `queer', and the images of
women are the `male bonding images of . . . Mother, Sister,
Prostitute, Madonna' . Though at their strongest in the armed
forces, these mechanisms clearly operate more widely . It is surely
not accidental that more men than women approve of nuclear
weapons, and that those men that oppose them often do so for
more superficial reasons . 'I

Finally, what of our own relationship, as socialists, to militarism . Conclusion :

It would be reassuringly simple to convey the impression that socialism
socialism is an unequivocally anti-militarist tradition . But it would and militarism
be quite false . For all the strength of socialist antimilitarism (for
which see Shaw, n .d ., and Liebknecht, 1907/1973), there is a
powerful strand of militarist thinking within socialism . From
Engels, nicknamed `the General' by his friends, through to Lenin
and Mao, war and its preparation have been major concerns of
Marxists ." And the states formed by socialist revolution have
certainly not been antimilitarist states .
Marxist orthodoxy has had a simple answer to the problems
posed by this : that capitalist militarism and socialist militarism
are essentially different . Lenin, for example, divided wars into
`just' and `progressive' wars on the one hand, and `imperialist'
wars on the other . The criterion was not who struck the first
blow, nor how a war was conducted, but the class nature of the
sides involved and their goals . Echoing Clausewitz, Lenin (in
Semmel, ed ., 1981 : 172) argued famously that `theoretically, it
would be absolutely wrong to forget that every war is but the
continuation of policy by other means' .
Paradoxically, it was Trotsky, military organiser and com-
mander of the Red Army, practitioner of what he himself de-
scribed as the `cruel and sanguinary art' of war, who implicitly
pointed out the glibness of this way of thinking of things . `War is
a continuation of politics : whoever wishes to understand the
"continuation" must get clear on what preceded it . But continu-
ation - "by other means" - signifies : it is not enough to be well

C & C 19 - E
 CAPITAL & CLASS

66 oriented politically in order to be able therewith also to estimate

correctly the "other means" of war .' War has its own 'indepen-
dent character', its own `inner technique, structure, its methods,
traditions and prejudices' . `This means that the profession of war
and its problems cannot be dissolved into social and political
categories .' (Trotsky, in Semmel, ed ., 1981 : 60, 144 and 143)
War and its preparation are not neutral tools . While I have
argued throughout this paper that militarism is tightly related to
the form of society in which it is found, that relation is a dialecti-
cal, not a uni-directional one . Militarism is not a simple, 'techni-
cal' instrument of social interests ; it has a momentum of its own
and becomes embodied in institutions that seek to mould their
environment to secure their survival . There is a thread - however
discontinuous - between Trotsky, reluctant practitioner of the
`cruel and sanguinary art', and the entrenched Soviet generals
with their SS-20s targetted on the working class of Western
Europe .
Personally, I cannot see an absolute pacificism as a viable
alternative . It is, of course, absurdly naive to imagine that a
popular revolution could defeat the intact repressive machinery
of a modern state . Even as long ago as 1848 the barricade was a
Portugal 1974: symbolic rather than a military instrument . `It was solely a
Workers and question of making the troops yield to moral influences . . . if [the
soldiers come insurgents] do not succeed in this, then, even where the military
together during are in the minority, the superiority of better equipment and
revolution
training, of unified leadership, of the planned employment of
 MILITARISM AND THEORY

67
military forces and of discipline makes itself felt' (Engels, in
Semmel, ed ., 1981 : 202-3) . Nevertheless, the question of the
repressive machinery of the state - or of semi-official bodies such
as the Latin American death squads - cannot be avoided by those
seeking socialist change . In mainland Britain the question may
still have an abstract air, but, as emphasised in the introduction,
in many parts of the world it is a very real one . In countries such
as Nicaragua and Cuba, where something of a socialist state has
been estabilished but is threatened from abroad, the question
becomes not simply one of insurgency, but of the construction of
`socialist' armed forces for national defence .
So it may be that socialists cannot in certain circumstances
avoid resort, however reluctantly, to armed force . What I would
argue strongly for, however, is awareness not simply of the
human costs of violence (that, I hope, should not need to be said),
but also of its political costs, costs that are typically ignored in
Leninist orthodoxy . Amongst these, three stand out . One is that
the large-scale organised use of, or preparation of, armed force
tends to be inextricably tied up with a strengthening of the state,
rather than its `withering away' . It is no coincidence that the
military might of the Soviet Union grew simultaneously with
both the strengthening and rigidifying of its state apparatus and
the rejection of proletarian internationalism in favour of
attention to the Soviet Union's position in the system of states .
The second is that the adoption of violent practices, or even of a
militarist style, will strengthen within any organisation those
more at ease with violence and more habituated to that style -
thus, for example, will strengthen men at the expense of women .
The third is that because violence has its own momentum and
imperatives, and particular urgency, it will tend to submerge all
other forms of opposition and resistance . That last is a risk that
has perhaps been exemplified at some points in time by the
impact of armed resistance to British rule in Ireland on other
forms of opposition .
There are difficult problems here, too difficult to resolve
now . But if we believe - as I do - that only the construction of
socialism can ultimately end the threat of militarism, war and a
holocaust, then we have a particular responsibility to ensure that
our path to socialism does indeed lead us away from these things,
and does not lead to their re-incarnation in new form . In essence,
the quesiton is one of what kind of socialism we want to build . If
socialism means a strong state and a continuance of male domin-
ation, then I fear it will be a militarist socialism . There is much
work to be done in thinking through, as well as in constructing,
an alternative socialism that will finally make these things no
more than bad memories .


CAPITAL & CLASS

68 Donald MacKenzie is involved in both the Conference of Socialist

Economists and the Campaign for Nuclear Disarmament in the
Edinburgh area, and was active in the Stop the War Committee set up
in Edinburgh to oppose the Falklands war . He teaches sociology at
Edinburgh University .

Notes This paper was originally a workshop contribution at the 1982 CSE
Conference . Thanks to those there for a helpful discussion, and thanks
also to those colleagues and friends who read and constructively criticised
earlier drafts, and who fed in ideas to the process of writing, particularly
Stuart Anderson, Barry Barnes, Cynthia Cockburn, Angus Erskine,
Lynn Jamieson, Dave McCrone, Russ Murray, Gian Poggi and Howard
W ollman .

More `impersonal' thanks to those whose work I've drawn on here,

particularly Mary Kaldor . I saw Kaldor 1982b only after this paper was
substantially completed, but I'm happy to acknowledge considerable
overlap between it and this paper .

1. Although much subsequent work has been critical of his position,

EP Thompson has been as important in this theoretical revival as in the
political revival of the peace movement . See in particular Thompson
(1980) .
2. Further references will be found in the article by Ron Smith in
this issue. Shaw (n .d .) is a useful introduction to the classical Marxist
analyses militarism .
3. See Ron Smith's article in this issue for some of these .
Probably the most commonly quoted definition of militarism is
that of Vagts (1959 : 13), who distinguishes between militarism and the
`military way' . `The military way is marked by a primary concentration
of men and materials on winning specific objectives of power with the
utmost efficiency, that is, with the least expenditure of blood and
treasure . It is limited in scope, confined to one function, and scinetific in
its essential qualities . Militarism, on the other hand, presents a vast array
of customs, interests, prestige, actions, and thought associated with
armies and wars and yet transcending true military purposes .' Even if
Vagts' distinction could really be sustained, which is dubious, it would
still seem wrong to exclude the `efficient' and `scientific' military way
from our analysis . In the text I am therefore deliberately defining
militarism in a way that avoids such distinctions .
4. The data on which the last two paragraphs are based were drawn
from Gansler (1982) . Much of it derives from the Department of Defence
`Profit '76' study . `Here, for the first time, individual defense profit
centres within large corporations were looked at, and the data "cleansed"
by certified public accountants' (Gansler, 1982 : 87) . While neither of
these processes guarantee accuracy, the overall patterns identified seem
plausible .
5. Estimates in this area are difficult because of lack of information,
difficulties of definition, and the problem of `multiplier' effects (the
spending by weapons workers and weapons firms made possible by
defence work) . The rough estimates in the text are based on Gansler


MILITARISM AND THEORY

(1982), though with account taken of much higher estimates for the 69
percentage of scientists and engineers supported by the weapons-
production system . For some of the complexities of calculation in this
latter field, see Woollett (1980) .
6. The quantitative information on which the last two paragraphs
are based is largely drawn from Gansler (1982) and SIPRI (1982) .
7. This claimed effect was the most controversial theoretically, and
in the early 1970s the internal bulletin of the International Socialism
group was filled with debate over its validity, complete with three-by-
three matrices! The crucial issue was whether `siphoning off' really
works . The surplus value siphoned out of the civilian economy is
invested in arms production, which was assumed, perhaps not altogether
accurately, to have a high ratio of constant capital to living labour . On the
face of it, then, arms spending seemed likely to increase, not decrease,
the overall organic composition of capital (the ratio of constant capital to
living labour) . Thus it could not sustain the rate of profit .
Defenders of the theory countered by arguing that the organic
composition of capital in arms production had a different status from that
in civilian production, because armaments did not `reenter' the economy
(unlike, say, wage goods or machinery) . The transformation of values
into prices worked in such a way that while the price of arms rose above
their value, the price of civilian goods fell below their value . Capitalists
were then able to buy means of production more cheaply, and to pay
workers lower wages, thus boosting the rate of profit.
For relatively accessible statements of the two opposed positions,
see Mandel (1975 : 287-93) and Harman (1981 : 51-55) .
8. This is essentially the position taken up by the excellent CND
campaigning pamphlet, The Arms Drain (Webb, 1982) .
9. The rearmament at the time of the Korean War is particularly
fascinating in its economic effects . Japanese export trade `increased 61%
during the first year of the Korean War', while West German exports in
1953 were four times what they had been in 1950 (Kolko and Kolko,
1972 : 634 and 644) . On the other hand, Britain, which did re-arm,
suffered a drastic long-term weakening of its competitive position, as key
export industries were re-directed to arms production .
10. The argument of this paragraph owes a great deal to discussions
with Stuart Anderson .
11 . Explaining militarism was not the main goal of their theorising,
however . Liebknecht (1907/73) apart, they were more interested in
understanding the changing nature of capitalism as a whole than in
analysing militarism in detail . So their theory of militarism tended to
remain rather schematic .
12 . McCarthyism, for example, was not merely official anti-
communism gone paranoid . It contained a critique of the cost of foreign
commitments, and suggested that the best, and cheapest, place to fight
communism was at home (Kolko and Kolko, 1972 : 649-50) .
13 . This is essentially the account of the state given by Holloway and
Picciotto (1977) .
14 . Indeed, it is perhaps significant that in most advanced capitalist
countries attempts have been made to separate institutionally wars and
their preparation (the job of the armed forces) from the maintenance of


CAPITAL & CLASS

70 public order (the job of the police of of specialised paramilitary units) .

15 . See, for example, London Edinburgh Weekend Return Group
(1980) for this argument applied to the modern welfare state .
16 . Such evidence as does exist on soldier's will to fight, which is
based largely on studies of the us armed forces in the Second World War,
suggests that what matters is not membership of a `nation' or of a large
organisation such as a regiment, but of a very small closely-knit group,
where personal survival is seen as depending on survival of the group and
where `fear of incurring by cowardly conduct the group's contempt' is a
real factor (Keegan, 1978 : 51) .
17 . Space prohibits examination of a further important aspect of the
relationship between militarism and the state : the connections between
military discipline and wider forms of discipline and between military
organisation and civil bureaucracy . For some interesting suggestions, see
Foucault (1979) and Hintze (1906/1975) . Even if exaggerated, Weber's
comment points to a real phenomenon: `Military discipline gives birth to
all discipline' (Weber, 1968, 3 : 1155) .
18 . One of the few pieces of Marxist state theory to attempt fully to
take this into account is Braunmnhl (1978) .
19 . Aside from the particular types of economic reductionism dis-
cussed in the text, there is a more general form of economic reductionism,
that of Immanuel Wallerstein and the `world systems' analysis associated
with him . For a pertinent comment, see Skocpol (1979 : 22) ; see also
Skocpol (1977) .
20 . It is interesting that Skocpol (1979) adheres explicitly to a different
way of seeing the state . `The perspective on the state advanced here
might appropriately be labeled "organisational" and "realist" . . . states
are actual organisations controlling (or attempting to control) territories
and people' (1979 : 31) . Useful and valid for many purposes as this
perspective is, it seems to me that exclusive reliance on it makes it more
difficult to see how we might begin to tackle the state system as a political
problem . For Skocpol's own, brief, thoughts on that problem see (1979 :
292-3) .
21 . In Edinburgh an antimilitarist demonstration unprecedented in
size since the campaign against the Vietnam War was organised in little
more than a week . Leaflets for it combined a direct `stop the killing'
appeal with a contrast between the Tory government's military ad-
ventures and welfare cutbacks .
22 . Not Scottish, nor Welsh - as the much lower support for the war
in Scotland and Wales perhaps indicated .
23 . The television coverage of the departure of the task force was a
particularly clear example of this . The Royal Navy is an interestingly
powerful symbol, commanding for several centuries much greater pop-
ular support than the army . Because they could not be used for internal
repression, `royal navies were never felt to be the props of despotism that
royal armies were' (Best, 1982 : 69) .
24 . The militarily crucial small groups described in footnote 16 above
are of course groups of fighting men .
25 . See the Gallup poll reported in the December 1982 issue of
Sanity . The gender difference in overall approval/disapproval is small
enough for it to be a chance effect, but its direction is consistent with that
 MILITARISM AND THEORY

shown in other studies . Women in the United States were consistently 71

more opposed than men to the Vietnam War, for example (Schuman and
Converse, 1970) .
It is interesting to speculate whether the apparent erosion of the
Conservative Party's traditional relative advantage amongst women
voters is connected to the growing polarisation of British party politics
around nuclear weapons .
26 . Even though both the collection and editor's introduction are
somewhat one-sided, this emerges powerfully from Semmel, ed .,
Marxism and the Science of War (1981) .

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 The paper discusses
the growing Fergus Murray
importance of the
decentralisation of
production, as one
capitalist response
to declining profits
and workers' resist-
ance in Italian manu-
facturing industry . It
argues that decen-
tralisation and
automation have re-
duced the traditional
strength and
quantity of male
workers in large
factories and have
The decentralisation
generated new
sectors within the of production
industrial working
class . The paper
ends with the
the decline of the
suggestion that the
labour movement
needs to reshape its
mass-collective worker?
organisation and its
strategies which
erroneously still IN THIS PAPER I want to examine one of the changes that have
continue to reflect been taking place in the organisation of production and the
only the needs of the labour process since the early 1970s, that is, the decentralisation
traditional mass of production . While the geographical dispersal of production is
worker .
a long established feature of capitalism, in the last ten years
decentralisation has undergone a quantitative increase and quali-
tative change . For example, in Italy large firms have reduced
plant size, split-up the production cycle between plants, and
increased the putting-out of work to a vast and growing network
of small firms, artisan workshops, and domestic outworkers .' In
Japan large firms using advanced production techniques have
insisted that their small supplier firms raise productivity through
technological innovation, while moves are underway to link the
small firms by computer to the large ones, thereby greatly in-
creasing the control of the large corporations over production . In
America and Britain increasingly mobile international capital in
74 high technology small units has been moving into areas of high
unemployment, for example in the southern `sun belt' states of
the US and in S . Wales and Scotland in Britain, where careful
labour recruitment exploits and exacerbates the segmentation of
the labour market and divisions in the working class . And
recently a statement in the Soviet press drew attention to de-
centralisation when it criticised the way in which Russian in-
 DECENTRALISATION

dustrialisation continues to be based on huge factories and 75

proposed a policy for the reduction of plant size and the develop-
ment of small, flexible, highly specialised and technologically
advanced production units . The article cited the example of
General Electric which continues to reduce plant size despite the
fact that all its 400,000 employees already work in factories of less
than 1,500 workers .' .
There is then a growing body of evidence which challenges
the idea that the progressive centralisation and concentration of
capital necessarily leads to a physical concentration of production
that the small production unit is the remnant of a disappearing
traditional, backward sector of production . For generations
Marxists have assumed that the tendency of capitalism was to the
greater and greater concentration of production, and massifi-
cation of the proletariat . Indeed there were excellent historical
reasons for making this assumption, as the development of both
the basic commodity industries of the first industrial revolution
and the mass production industries of the post-war boom led to a
high concentration of workers in large integrated plants in large
industrial towns .' Nevertheless the above evidence suggests that
the size and location of production cannot be drawn from theor-
etical premises but rather that they are historically determined,
depending on the particular circumstances capitalist production
faces in different periods .
This paper draws on empirical material from Italy to show
how the use of decentralisation has been intensified and has
changed through the introduction of new technology as Italy's
dominant firms have sought to restructure production in their
struggle against declining profitability . In Italy the combination
of automation and decentralisation has been specifically aimed at
destroying the power and autonomy of the most militant and
cohesive section of the Italian proletariat and this strategy has
met with considerable success . This suggests that the political
hopes pinned on the mass-collective worker in the seventies need
to be carefully reconsidered in the light of decentralisation and
the recomposition of the proletariat this implies .
The paper is organised as follows :
The first section examines the determinants of the domin-
ant organisational form of post-war industry, the large factory,
and suggests that this form is historically specific, being con-
tingent on the balance of class forces and the technologies avail-
able to capital .
Using empirical material the second section attempts to
define the different forms of decentralisation in order to bring out
the wide variety of different workplaces and workers which
decentralisation creates through its physical fragmentation of the


CAPITAL & CLASS

76 labour process .
The third section analyses the way in which the application
of information technology in production management not only
gives capital a greater potential control over labour in the large
factory, but also gives it the possibility of coordinating pro-
duction and labour exploitation that is increasingly dispersed in
small production units, artisan workshops and 'home-factories' .
The last part of the paper suggests that decentralisation
has created new divisions in the industrial working class by
increasing the number of workers living and working in condit-
ions that greatly differ from those of the mass-collective worker .
The transformation of the large factory and the rise of small
production units has made collective action considerably more
difficult . The paper ends by asking how both old and new
divisions can be effectively challenged by the labour movement
and the left, with a strategy and organisations that give voice to
the different needs and desires of different parts of the prolet-
ariat, while also giving them a unity that can overcome divisions
rather than exacerbating them .

The large The term `decentralisation of production' has been used in Italy
factory : Is it to describe a number of distinct features of the organisation of
inevitable? production . In general, decentralisation refers to the geographi-
cal dispersal and division of production, and particularly to the
diffusion and fragmentation of labour . However this can take
place in a number of ways :
i) The expulsion of work formerly carried out in large
factories to a network of small firms, artisans or domestic out-
workers .
ii) The division of large integrated plants into small,
specialised production units .
iii) The development of a dense small firm economy in
certain regions such as the Veneto and Emilia Romagna in Italy .
In Italy `decentralisation' has been used to cover all the
above developments . In this paper `decentralisation' is used to
refer to the expulsion of production and labour from large factor-
ies, either in the form of in-house decentralisation (splitting-up)
or inter-firm decentralisation (putting-out) within the domestic
economy . This is because the paper focuses on the way large and
medium firms in Italy have used decentralisation to reduce costs
and increase labour exploitation, rather than on the development
of districts of independent small firms that are not directly sub-
ordinate to larger firms . The analysis of this latter process has
been an important part of the Italian debate on decentralisation
(e .g . Brusco, 1982 ; Paci, 1975 ; Bagnasco et al, 1978) .
 DECENTRALISATION

An assumption has prevailed that large corporations 77

operating in such sectors as engineering and electronics will
organise production in large factories, in that they will amass
large amounts of fixed capital and workers in particular, on any
given site . However factory size is not given, and least of all does
not necessarily correspond with the size of a firm or corporation's
turnover, or their market and financial strength . Rather it is
determined by the specific configuration of the conditions for
profitable production prevailing in any given period . For
example, the integrated car plant developed in rapidly expanding
markets, with the balance of class forces intially in capital's
favour, which made possible and profitable a particular com-
bination of technology (mechanised flow line production) and
labour domination (Taylorism) . It was the coincidence of all
these factors that made the integrated plant the most profitable
form of production organisation in the post-war consumer
durables industries . When labour rebelled and markets began to
stagnate the `efficiency' of this form of production was under-
mined and both capitalists and bourgeois economics discovered
`diseconomies of scale' . The ending of the long wave of ex-
pansion, the development of new technologies, and new manage-
ment techniques have all contributed to change the form of the
division of labour and the labour process within the large cor-
poration . Five of the more important factors that influence
factory size are the type of product being made, the technologies
available, product control, industrial relations and State legis-
lation . I shall consider the role of these factors in turn .

Product Type

Product type is important in determining the degree to

which the production cycle for a given product can be divided
between separate factories . Industries where there is a high
divisibility of the production cycle include aeronautics,
machinery, electronics, clothes, shoes, and furniture . In contrast
the steel and chemical industries tend to require a large unified
production site, although the optimum plant size is not always as
large as some people, for example BSC management, think
(Manwaring, 1981 :72) .
One particularly important development that has been
taking place in the structure of some products is a process known
as modularisation . Although there has been a diversification in
the number of models in many ranges of consumer goods, this
has been underlain by a standardisation of the major sub-
assembled parts of the product . These sub-assembled parts are
the basic modules of the product and can be made in different
 CAPITAL & CLASS

78
factories and put together at a later date . For example, as argued
in Del Monte (1982 :154-6) at one time televisions were as-
sembled in a linear manner on a long assembly line . The frame of
the television would be put on the line, and individual parts then
added to it . In modular production each module is assembled
separately, and a much shorter process of final assembly is re-
quired . At present modular production is mainly limited to
commodities from the electronics sector, but advances in
product redesign facilitated by the introduction of micro-
electronic components suggest that it will be used elsewhere .
(See the example of Fiat later .) If we recall how the bringing
together of large numbers of workers on assembly lines in the
sixties fuelled workers' spontaneous struggles, modular pro-
duction, plus the increasing automation of the assembly areas
themselves, can serve as important weapons for capital in reduc-
ing worker militancy through decentralisation .

Technology

Brusco (1975) argues that Marx's explanation for the con-

centration of production in large factories was partly based on the
necessity of running machines from a central energy source - the
steam engine . As steam was replaced by electricity as the principal
energy source for industry this particular decentralising tendency
was weakened . Initially the expense of electric engines meant
that one central engine and a system of transmission shafts and
belts were used to drive the different machines . But as electrical
technology developed and the price of engines fell, each machine
was fitted with its own motor .' Other technological changes that
affect the product and the organisation of production include
shifts in materials, for instance, from steel to plastics, but the
most important change that has been taking place in the last
decade is the introduction of the microchip into the production of
many commodities . While the microchip tends to a lessening of
worker control over machines, it is also changing the nature of
those machines . Generally there is a trend towards a replacement
of electro-mechanical parts with microelectronic components,
and from worker control of the machine to the installation of the
unit of control in the machine which leads to changes in the
production of the product and its associated labour process .
Olivetti has been transformed from an engineering multinational
to an electrical one over twenty years, and in many engineering
firms electrical control systems are now taking over from
mechanical ones . This implies a reduction of machine shop work
in production . It is also interesting to note that electrical work,
such as wiring and the assembly of circuit boards has in some
 DECENTRALISATION

cases proved suitable for putting-out to tiny firms employing 79

semi-skilled women workers - so suitable, according to Wood
(1980) in Japan there are an estimated 180,000 domestic out-
workers in the electrical components industry alone . Similarly, a
firm in Bologna making control units for machine tools did some
quite radical experimenting with decentralisation as it shifted
from electro-mechanical to electronic control systems . According
to the Bologna metalworkers' union (FLM Bologna, 1977 :78),
with the appearance of micro-electronics in the seventies the firm
began to run down its machine shops and progressively
intensified putting out which eventually accounted for 60% of
production costs . At this time the firm employed about 500
workers directly and over 900 indirectly as outworkers . A couple
of years later with the introduction of automation the firm re-
centralised production and an estimated 600 outworkers lost
their jobs .
There are then techological changes taking place that allow
decentralisation and falling factory sizes but it needs to be stressed
that these changes don't automatically lead to decentralisation . It
is the particular capitalist's use of technology and the conditions
of profitability that will determine how the organisation of pro-
duction changes .

Product Control

The making of many commodities requires huge amounts

of co-ordination and control of production and pressure to re-
duce dead time, stocks, and all types of idle capital has increased
markedly since 1974 . In a big plant, production is difficult to
supervise at every level and the sheer size of the factory and the
bureaucracy needed to run it can hide huge amounts of waste .
This would suggest that for the capitalist the division of pro-
duction and management into smaller and more easily controlled
units would be a cost effective strategy . 9 The introduction of
computer assisted management allows production to be split-up
by making the co-ordination of production in different plants
considerably easier . General Motor's new `S' car, for example, is
being built in GM's European production network which em-
ploys 120,000 workers split-up in 39 plants in 17 countries
(Financial Times, 28 .9 .82)

Industrial Relations

The reduction of factory size and relocation of production

are contingent upon the extent to which `unfavourable' industrial
relations are an important reason for restructuring in different
 CAPITAL & CLASS

80 industries in different countries . Prais (1982) suggests that

factories in the UK with over 2,000 workers are 50 times more
vulnerable to strikes than those with less than 100 workers, and
he goes on to say in his academically refined union bashing tone,
that big plants in UK car assembly, steel production, and ship-
building develop endemic strikes "which impedes the pursuit of
efficiency, and leads ultimately to self-destruction" . (p . 103) .
In the late 60's labour militancy in many Italian industries
reached levels that directly threatened firm profitability and
management undertook a series of strategies designed initially to
reduce the disruptiveness of militant workers . One of these
strategies, decentralisation, was in part underlain by a manage-
ment view, typified by the director of a Bologna engineering firm
to whom I spoke, which saw a direct correlation between factory
size and industrial relations in Italy in the 1970s . This director
argued that a significant improvement in industrial relations
could be achieved in a factory employing 100 rather than 1000
workers .
This is not to say there is an automatic relationship between
industrial relations, labour militancy and factory size . Rather
large plants in the post-war boom appear to have created con-
ditions favourable to an intense and often `unofficial' shop floor
struggle that has been very disruptive for capital . It would be
wrong therefore to equate the rise of smaller production units
with the end of labour militancy on the shop floor . It seems that
capitalists expect substantial `improvements' in industrial re-
lations from smaller scale production units . Clearly this will
impose new and real difficulties for the autonomous organisation
of workers and the forms it should take in small plants . However,
the struggles at Plessey Bathgate and Lee Jeans have shown that
these are not unsurmountable .

State Legislation

Central and local state legislation will be important in

determining factory size and location in a number of ways .
Incentives, grants subsidies, and factories themselves may all be
used to persuade firms to set up additional sites, as can be seen by
the unco-ordinated efforts of the various regional development
agencies in the UK .
Employment legislation, and its implimentation, may also
be very influential . In Italy important parts of the Worker's
Statute do not apply in firms employing less than 15 workers .
And the smaller the plant the more possibility there is of using
illegal employment practices, such as the use of child labour, and
the evasion of tax and national insurance payments' .


DECENTRALISATION

Using empirical material from the Bologna engineering industry, Different 81

this section examines the two forms of decentralisation that have forms of
been used most extensively in Italy by large and medium sized decentralisation
firms . The intention here is to examine the way decentralisation
changes the nature of work and workers and the relationships
that exist between firms . An analysis of the relationships between
firms is important for the left, especially in view of assessing the
accuracy and implications of two trends that are supposedly
taking place, one is the vertical disintegration of many corpor-
ations and the other is the growing wave of support, in Britain
especially, for small business from the State and even the banks .
On the basis of Macrae's analysis (1982), one would, think that
the power of monopoly capital was withering away to open a new
golden age for the entrepreneur . However, while it may be true
that some corporations are withdrawing from direct control of
some production this in no way implies a weakening of their
power . Rather, through decentralisation these corporations may
maintain a strict control over production while letting the small
firm pay the costs and face the risks of production, thereby using
decentralisation as a means for reducing and shifting the cor-
poration's risks and losses . In this way corporations maintain
their ability to cover fluctuating markets while concentrating on
the most profitable areas of production . This of course, does not
mean that all small firms are subordinate to a particular corpor-
ation and manymay even find a degree of independence .'

Putting-out

Putting-out involves the transfer of work formerly done

within a firm to another firm, an artisan workshop or to domestic
outworkers . After the initial transfer, putting-out can be used to
describe a semi-permanent relationship between firms .
Within the Italian economy putting-out appears to have
contributed significantly to the rise of small firms and to the
surprising shift that has taken place in industrial employment in
the last ten years . In 197122 .9% of the total industrial workforce
were employed in `mini-firms' of less than 19 employees . By 1978
this figure had risen to 29 .4%, an expansion of employment in the
,
mini-firms' of 345,000 . Furthermore the number of men em-
ployed in these firms rose by only 8 .3% in this period, whereas
the number for women grew by 33 .8% . While it is difficult to
generalise from such disaggregated data, they do indicate a steady
growth of employment in very small production units for which
the putting-out and the geographical fragmentation of production
have been partly responsible . The period from 1974-8 is par-
ticularly interesting as a fall of employment of 52,000 occured in

C & C 19 -
 CAPITAL & CLASS

82 firms of over 500 employees, whereas employment rose by 160,000

in the 'mini-firms' (see Celata, 1980 :85)
In the Bologna engineering industry, in the period 1968-
80, the number of artisan firms employing between 1-15 em-
ployees rose from 6,602 to 9,436, an increase of 42 .9% and nearly
a third of the Bologna engineering labour force of 88,000 was
working in these workshops in 1980 (see FLM Emilia Romagna,
1981 :18-19)
The existence of this dense network of artisans workshops
and small firms and its expansion due to an initial restructuring of
the Bologna engineering industry in the 1950s, has been one of
the vital preconditions for the development of putting-out and
the increasing division of labour between small firms . As the
example that follows suggests, decentralisation has passed
through two phases : a first phase between 1968-74 when putting-
out was used less out of choice than necessity due to intense
shop-floor struggles in the large and medium factories ; and a
second phase, since 1975, of more systematic use of decentra-
lisation, with the introduction of information technology into
production planning and the appearance of numerically con-
trolled machine tools in increasingly specialised artisan shops,
accompanined by a gradual reversal of some of labour's gains on
the shop floor . In this second phase it is possible to see an implicit
shift from the direct control of labour on the shop-floor in the
large Taylorised factory to a more articulated and flexible system
of the organisation of production where the labour process ex-
tends beyond the factory into the artisan workshop . In the artisan
workshop the unmediated forces of the market that threaten the
artisan's very existence ensure a high degree of 'self-exploitation'
often reinforced by the paternalistic despotism of the small
entrepreneur .
In the Bologna engineering industry there appear to be
three motives for putting-out : to reduce fixed costs to a mini-
mum ; to benefit from wage differentials between firms ; to maxi-
mise the flexibility of the production cycle and of labour ex-
ploitation . The nature of putting-out is examined below through
its use in a Bologna precision engineering firm .
The strategy of this firm, according to the management,
has been to invest in labour and machinery just below the level of
minimum expected demand . Any increase of production above
this level has been met by putting-out, rather than risking an
expansion of the factory or the workforce . However, contrary to
management's claims, it is not true that the size of the labour
force has always depended upon the level of demand . Until 1969,
that is until when the first big strikes occurred, the size of the
workforce grew steadily . However, after 1969, although pro-
 DECENTRALISATION

duction output rose rapidly for a number of years, the level of 83

employment of production workers and productivity in the firm,
actually fell . It therefore appears that a decision was taken to
limit employment in the firm as militancy on the shop-floor
increased and to cover rising demand by massively raising
putting-out . In 1972 46% of production work was put-out of the
firm, employing indirectly the equivalent of 570 full-time
workers in small firms and workshops, whereas in 1969 only 10%
had been put-out . In 1974-5 production fell rapidly, and work
put-out dropped to almost nothing, resulting in the loss of
approximately 550 jobs . That is, while the level of employment in
the firms working for the company went through a massive
fluctuation, employment in the company itself was relatively
stable . The company putting the work out did not then pay a
penny of redundancy money and nor was there any disruptive
and socially embarassing struggle over job losses . This illustrates
clearly the flexibility putting-out can provide . In this instance the
reason for putting-out was not so much the exploitation of wage
differentials as the minimisation of costs and conflict over job
losses with the union .
However, the same firm does also put-out work for savings
on wages, where the outworkers are paid up to 50% less than
their counterparts in the factory . The work put-out here is not
mechanical work, but wiring and circuit board assembly and
involves women working in small firms and sweatshops where
they have no legal or union protection .
With the introduction of computer assisted management
and with the changes taking place in modular design, the firm has
recently overhauled its putting-out system . Formerly, work of a
once only basis was put-out to artisan shops the basis of very short
lived and verbal agreements . The firm now encourages these
artisans, who often employ less than five people, to group them-
selves together in order to amass the machinery and skills neces-
sary for the production and sub-assembly of modules on a more
regular basis . Meanwhile, management has won back some of its
former power on the shop-floor with the help of computer aided
production and an increase in internal labour mobility . The
introduction of the computer has given management an increas-
ingly refined control over the co-ordination of production both
within and outside the factory, and putting-out is now used more
routinely, while special and rush jobs are done in the factory due
to the increased mobility of labour, achieved after six years of
almost total rigidity .
Putting-out here has gone from a contingency solution of
special problems to a more structured system . Initially flexibility
was found in putting-out to artisan workshops to get around
 CAPITAL & CLASS

84 rigidity in the factory . Now it is the whole system, factory

production and putting-out, that works to give flexibility .
Putting-out in Bologna engineering varies from skilled
well-paid work using advanced technology to dirty dangerous
and deskilled work . Within this there is a clear division of
putting-out based on sexual and racial divisions in the labour
market . The skilled workers and artisans are almost exclusively
middle aged men, while women, the young, and migrants from
the South of Italy and North Africa are concentrated in the
dirtiest, most precarious and worst paid work .
The other extensive form of putting-out is to domestic
outworkers in industries like clothing, electrical components,
and toys . This form of putting-out has received a good deal more
attention than putting-out to small firms (e .g . Young, 1981 ;
Rubery and Wilkinson, 1981 ; Goddard, 1981) and will therefore
not be dealt with here .
Another increasingly important type of putting-out is that
which takes place across national frontiers where either parts of
the production cycle are contracted out or the firm contracts out
the production of the finished commodity it already makes, using
its own specifications and technology for production in the sub-
contracting firm and its marketing network for the sale of the
commodity . An example of the former type of international
putting-out is cited in Frobel et al (1980 :108) and refers to the
extensive use the West German textile industry makes of textile
firms in Yugoslavia, where firms send out semi-finished products
from Germany to be worked up into the final product . And an
example of the latter can be found in Del Monte's study (1982) of
the electronics industry in Southern Italy, where, again West
German firms making televisions, contract out the production of
complete sets to medium sized firms around Naples . The firms
doing the work use the German firm's know-how and marketing
services, not being big enough themselves to break into the world
market . They, in turn, put out work to smaller firms in the area .
(pp . 150-1)
Putting-out then cannot be equated with an archaic and
disappearing system of production . Rather it seems to have been
reinforced as specific sectors of industry have faced altered con-
dition in the harsh economic and political climate of the seventies
as the long-wave of expansion ground to a halt . Therefore it
would be mistaken to continue to segment firms in terms of the
dualist opposition between large firms using high techology and
small firms using outdated technology and traditional production
techniques .'
 DECENTRALISATION

Splitting-up production 85

The second form of decentralisation is the splitting-up of

production between factories of the same firm . Clearly firms will
relocate factories, and change the organisation of production
between them for many and inter-linked reasons . Here, I want to
look specifically at splitting-up where it has been strongly
motivated by management's desire to make the workers' organis-
ation as hard as possible, and where management has realised the
potential dangers involved in concentrating large numbers of
workers in large factories located in the large industrial town .
While, with the internationalisation of production the fate of the
domestic industrial working class is increasingly linked to the
fate of the international working class, it is important to under-
stand how the location and structure of the domestic proletariat is
changing in a period of restructuring in the national and inter-
national economy .' Here I will examine some of the ways localised
splitting has been used in the Italian economy .
In one of the Bologna engineering firms referred to pre-
viously, the upsurge of union militancy in the early seventies was
met not only by an increase in putting-out but also by a partial
splitting-up of production . While employment was allowed to
fall in one factory in the firm, another small factory employing 80
workers was established an hour's drive away in a depressed
agricultural region . Although the shop stewards were not slow to
make contact with the workers in the new factory it has been
difficult to take unified action . The workers at the small plant
came from rural areas, do semi-skilled work, and are willing to
work `flexibly', that is they are prepared to change shifts and
work over-time so that they can also work their plots of land . In
contrast, the workers in the main factory are more skilled, they
come from an urban background and are endowed with a militant
trade union tradition .
Once the small factory was set up management then tried
to put-out work from it into the surrounding area, but found that
there were not enough small firms in the area to allow this .
However, the tendency to set up `detached workshops' has been
widespread where production permits this . One of the few studies
of Fiat's decentralisation of production into Central Italy (Leoni,
1978) has shown how, in its lorry division a mixture of splitting-
up and putting-out has been used to maximise the dispersion of
the directly and indirectly employed workforce in many very
green 'greenfield' sites in a rundown agricultural area .
Another type of splitting-up is when the firm loses a central
factory to become an agglomeration of `detached workshops' .
Although this strategy is less common one example from Bologna


CAPITAL & CLASS

86 is striking . In this firm there are three `major' production sites,

three `minor' ones, a stores site, a research site, and an adminis-
trative site spread out in the periphery of Bologna . In all, the firm
employs 300 people dispersed in the different sites . Along with
this fragmentation of production the firm also practices a high
level of putting-out, and is progressively running down its
machine shops to concentrate only on assembly, design and
marketing activities .
A final example of splitting-up is provided by the electric
domestic appliance company belonging to Vittorio Merloni, who
is the head of the Italian employers federation, the Confindustria .
The firm employs 2,000 workers who work in nine different sites
and no factory has substantially more than 200 workers . The

Small Firms

tits,
,,,Putting-out
A schematic representation of the decentralisation of production --_

City Factory

dispersion putting-out

Formally independent firms

Rural/Third World Factories

0 putting-out

Small firms directly

created by firm A

Formally independent firm

III
sub-putting-out,
, ,

III
Domestic out workers
 DECENTRALISATION

basis of managerial strategy is to take work to the workforce in 87

the depressed agricultural regions of Central Italy, where higher
transport costs are easily offset by the `industrial tranquility' of
the environment . One of the Merlonis specifically acknowledges
that it is "an advantage to have reduced concentrations of workers,
and where possible, to know each worker" . And he goes on to
explain that the firm has tried to create "a group spirit in and
outside the plants" to encourage workers to identify with the firm
without losing their roots in the rural community . The idea
behind this is to soften and control the traumatising and often
radicalising, transition from peasant production to work in a
capitalist factory . Meanwhile, to keep things even more `tranquil'
the Merlonis concentrate their efforts on doing pressed steel,
assembly and finishing work while the rest of production is
put-out to small firms and artisan shops often directly created by
the Merlonis, who have paternalistically handed ex-workers the
chance to `go it alone' (see Lotta Continua, 22 .5 .80 and 23 .5 .80) .
By way of ending this section on decentralisation, the
diagram below shows how different types of decentralisation
could be used by one firm to create a diffused production net-
work, or as some Italians say, a `diffused factory' .

Within any mode of production the collection, analysis and The Computer
circulation of information is vital . Within capitalism a particular in the
form of factory production has arisen where one of the functions factory
of the factory is the provision of a structure where information
can be collected, co-ordinated and controlled . As communication
technology has developed, the emergence of multi-plant and
multinational enterprises has been made possible . Although tele-
phones, telex and teletransmitters and the like are in no way
determinants of the organisation of production, they have allowed
the centralisation of control over capital to increase with the
internationalisation and geographical dispersion of production .
However, the large factory has remained the basic unit of capital-
ist production .
The structure of the factory has developed, among other
things, to ensure the free flow of information from the bottom of
a pyramidal hierarchy to its top, and the free flow of control from
the top downwards . Information, and access to it, are the key to
formulating and understanding a firm's strategy . For this reason
a firm uses a lot of people to collect and transmit information in
the factory and this information is carefully guarded . The people
who have the greatest amount of information are in a superior
position to judge and make decisions, and they will argue that
they are `objectively' correct because of their access to recorded
 CAPITAL & CLASS

88 `knowledge' . In short, access to and the control of information is

an instrument of class and sexual power .
In an engineering firm making complex automatic
machines there may be as many as 20,000 separate pieces circu-
lating in the factory . For management, this represents big prob-
lems and costs . As orders come in and are changed, the production
of each piece must be planned and co-ordinated so that the final
product is ready on time . Fixed capital and workers must not be
allowed to stand idle, detailed plans of machine loadings, stocks
and work schedules have to be made and a change in orders, a
delay by a supplier, a strike, an overtime ban or a breakdown can
all upset these plans . At present many firms incur high manage-
ment costs to ensure the co-ordination and monitoring of pro-
duction within the factory . Traditionally this monitoring has
been carried out by people writing things on bits of paper,
passing them up the hierarchy, amassing them, analysing them
and issuing orders based on them . Yet an increasingly flexible
production orgnisation is needed to get round worker-imposed
rigidity, to ensure the full use of increasingly large amounts of
fixed capital and to cut costs `down to the bone', in the face of the
burgeoning contradictions of the system .
The introduction of computer assisted management is a
potentially valuable weapon for capital because it can increase
management's control over all aspects of production, firstly
through the further expropriation of worker's knowledge (mental
labour) and secondly, through an `objectification' of control over
labour that ensures the maximum saturation and co-ordination of
labour time .
In one Bologna engineering firm there is a computer ter-
minal for every thirteen employees . The terminals are used to
both issue orders and to collect, feed back, memorise and co-
ordinate information . The course of each part is monitored and
information about individual machines and workers, such as
work times and `performance' are constantly recorded . Infor-
mation from the four basic divisions of the factory, production,
marketing, stock control, and planning arrives at the central
computer and data base and is recorded and analysed on a
day-to-day basis . Information arriving from one department will
automatically lead to co-ordination with other departments
through the computer's central programme . This gives the man-
agement the possibility to foresee where and when bottlenecks
will occur, and allows management to experiment with `dry'
production runs on the computer to examine the ways in which
potential blockages in production, including strikes, can be over-
come through changing production plans in the factory and by
increasing or changing plans for putting-out .
 DECENTRALISATION

I'll now briefly point to three other areas where manage- 89

ment benefits from the computer in production . Firstly, idle
capital can be reduced to a minimum, whether through a greater
control of labour or of stocks, as is achieved by the Japanese
'kanban' (just-in-time) system of stock control . This system uses
computers to co-ordinate in-house production and to link its
surrounding ring of external suppliers so that stock requirements
are calculated on an hourly and not a daily or weekly basis .
Production is maintained by
`suppliers feeding a wide array of components, in the right
order, through the right gate in the assembly complex to
reach the line at the right time' .
Secondly, automatic machines and robots can be linked
together and run by a central computer, as is beginning to
happen in the fully automated flexible manufacturing system .
For example, General Electric has recently announced a new
computerised system of information control and co-ordination
which will enable robots `to communicate with each other' and
link all machines with electrical control into an integrated system,
the remote parts of which can be connected by satellite links .
(Financial Times 30 .3 .82 .) Thirdly, computerised information
allows the decentralisation of day-to-day management decisions
while centralising strategic control in the hands of a slimmed-
down board of directors . 10
For supervisory staff the introduction of information tech-
nology makes their information gathering role potentially ob-
solete, as the factory hierarchy changes from a function of pro-
duction command to a more subtle one of political mediation .
Fiat has taken this process further and in workshops and offices
where now there are no shop stewards,
`Fiat takes care of the problem of mediation with its soci-
ologists, its new 'vaseliners' who talk to the workers about
their problems' ."
For shop-floor and office workers, computers mean stricter
control through an impersonal and distant centre, rather than
through face-to-face confrontation with the factory hierarchy .
Anything a worker does may be recorded by the computer and
used against her/him at a later date, while informal breaks won
through struggle tend to be formalised and handed out as and
when management see fit . And the versatile computer doesn't
lose its temper, can also issue orders in Swedish, Finnish, Yugo-
slavian and Turkish, as the ones used at Volvo do . (See Zollo,
1979 ; Dina, 1981 ; Ciborra, 1979)
However, a computer system is only as good as its pro-
gramme and the degree to which workers are willing to co-
operate with management . That is, the potential gains from the
 CAPITAL & CLASS

90 introduction of information technology are contingent upon

management's ability to erode worker resistance to the technology
and prevent new forms of resistance from developing . In one
Bologna firm the introduction of terminals on the shop-floor was
met by an `information strike' where the workforce refused to
co-operate in the collection of information .
One of the major benefits for capital is that computer
assisted management can largely replace the function of the
factory hierarchy as an information collecting network . And this
in turn opens up the theoretical possibility of changing the
organisation of production radically through restructuring .
Ferraris (1981) sums up the situation well .
`The new technology of the product (modularisation), of
production (automation), and information (distributed in-
formation and telecommunications) opens up new spaces
to the process of decentralisation of work and machines,
which advances simultaneously with the concentration of
management and control . This permits the overcoming of
the historical tendency of the physical concentration of
labour and fixed capital as a necessary condition for the
centralisation of command and profits .' (p .25)
So far, I have tried to show how the tendency towards
decentralisation of production and centralisation of command is
taking place . In order to reinforce the argument put forward, I
shall cite some Italian examples where it is possible to see this
process taking place .

Olivetti

Olivetti's gradual transformation from an engineering

group to an electrical one has been speeded up rapidly in the last
few years, with the appearance of the dynamic management
techniques of C . De Benedetti . Four particular processes can be
seen at work :
i) At the financial level, Benedetti has arranged a bewil-
dering series of deals with other international electronics pro-
ducers which include, Hitachi (marketing), St . Gobain (funds
and access to the French market), Data Terminal System
(acquisition) and Hermes (take-over of a Swiss typewriter
producer) .
ii) Within Olivetti's Italian plants there is a move towards
automation, using robots and the introduction of computer con-
trolled testing of standardised modules .
iii) Most assembly work is still done manually, but the
increasing flexibility needed due to the rapid development and
obsolescence of models led management to introduce non-linear
 DECENTRALISATION

assembly in the form of work-islands . 91

iv) While most assembly work is done in the factory some
operations like circuit board assembly and wiring are put out to
domestic outworkers in the North of Italy . This process is dis-
cussed in Pervia (1980) .

Benetton

Benetton is an Italian clothes producer with a turnover of

£250 million a year and sells under the names of Jean's West,
Mercerie, Sisley, Tomato, 012, My Market and Benetton . Pro-
duction and marketing strategies are aimed at achieving two
things, the minimisation of costs, the maximisation of flexibility
and naturally, profits . This is achieved in the following ways
i) Since the fifties Benetton has increasingly decentralised
production . It now directly employs only 1,500 workers and puts
work out to over 10,000 workers . The directly employed workers
work in small plants of 50-60 employees, where the union is
`absent or impeded' .
ii) In its marketing structure, Benetton has 2000 sales
points, but owns none of them . It gives exclusive rights to them .
This strategy effectively reduces not only the selling price of the
product by cutting the wholesaler out of operation, but it also
externalises risks ensuing from fluctuating demand .
iii) Computers are used to keep track of production and
sales and to swiftly analyse market trends . Stocks are kept to a
minimum of undyed clothes that are dyed when required . (See
Ferrigolo, 1980)

Fiat

At Fiat there are four particular things to note :

i) a massive expulsion of labour after the defeat of the 1980
strike
ii) a big move towards automation with the LAM engine
assembly plant and the Robogate body plant, both of which are
highly flexible robots operated by a centralised computer system .
iii) the introduction of work islands in the LAM system
iv) Fiat's use of decentralisation . This has taken three
forms : firstly the export of integrated production units to E .
Europe, Turkey and Latin America in the early 1970s ; secondly
the splitting-up of the integrated cycle and the creation of small
specialised plants in the South of Italy, which also began in the
early 1970s ; and thirdly, the putting-out of work from the Turin
plants to local firms, artisans and outworkers .
Following the Japanese model Fiat has recently declared
 CAPITAL & CLASS

92 that in addition to assembly work, it will only produce the

suspension systems and technologically important parts of the
car in house . All the rest of the work is to be decentralised,
although it is unclear what form this decentralisation will take .
There has recently been a devastating rationalisation of outside
suppliers, with Fiat cutting the number of its suppliers by two-
thirds and `encouraging' the survivors to raise productivity and
begin to sub-assemble parts in their own firms . Already 40% of
the Ritmo model is sub-assembled outside of Fiat's factories .
Vittorio Ghidella, managing director of the car division says,
`What we have done is to transfer employment from Fiat to
outside companies" 2
in order to disintegrate vertically as the Japanese have done .
A worker from Fiat's Lingotto pressed steel plant said in
1978 that small is hardly beautiful when you're working in one of
the 70 firms with 30-50 employees that make parts of Fiat's
decentralised lorry bodywork, where you work Saturdays, and
do 10-12 hours overtime each week . He maintained that,
`The question of decentralisation and the lack of unity
between small and big factories has been the weakest link
in the struggles of the past years .' (II Manifesto, 5 .10 .78)
Fiat's policy then seems to be aimed at automising what
can be automised and decentralising as much as possible so that
`decentralisation is the other, almost necessary, face of robotis-
ation and the LAM .' (II Manifesto, 4 .4 .80)

The decline In Italy the increased pace of decentralisation, automation,

of the internationalisation and an eventual frontal attack on the working
mass-collective class were provoked by two principal developments - the emer-
worker? gence of a militant, well organised labour movement and the
stagnation of world markets . The heightened shop floor struggles
in the large and medium factories threatened the very `efficiency'
of Fordist production techniques, based on the maximum flexi-
bility and total subordination of labour to capital . The strength
and combatitivity of the large and medium factory proletariat
made impossible a restoration of managerial control through
economic recession and increased factory repression, as had
happened in 1963-4 . Increased competition in world markets and
the slump of 1974 made it difficult for firms to pass on the costs
imposed on them by labour's gains, while labour rigidity reduced
their ability to respond to fluctuations in increasingly unstable
markets . As a consequence large firm profit rates fell .
Decentralisation was then grasped on initially as a short-
term strategy aimed at evading the labour movement's advances,
in that it attempted to compensate high labour costs and low
 DECENTRALISATION

flexibility in the large and medium factories by directly creating 93

or putting work out to small production units, artisans and
domestic outworkers, where the influence of the unions was
minimal (the small firms in question often being hidden in the
submerged economy) . However, the longer term aim of de-
centralisation, automation, and the over-arching control of pro-
duction by electronic information systems is the destruction of
the spontaneous organisation of the mass worker on a collective
basis . The dramatic confrontation at Fiat in 1980 hides a strategy
which implies much more than a temporary political defeat for
the large factory proletariat . Whereas decentralisation was in-
itially a short-term response, its very efficacy has largely pre-
cluded a recentralisation of production . Indeed it has been used
in conjunction with automation to begin to dismember the large
factory proletariat through the increasing division and dispersion
of into small plants and into the sweatshop where accumulation is
unrestrained by organised labour .
This is not to imply that the mass-collective worker is now
politically insignificant . Indeed the power of organised labour
based largely on the mass-collective worker is such, that Frobel
et al (1980) say,
`Any company, almost irrespective of its size, which wishes
to survive is now forced to initiate a transnational re-
organisation of production .' (p . 15)
in order to take advantage of the cheap abundant and well
disciplined labour of the underdeveloped countries . Undoubted-
ly an international reorganisation of capital is taking place but as
Graziani argues (1982 :34), decentralisation draws attention to
the fact that an abundant, potentially cheap and well disciplined
labour force is also available within some advanced capitalist
countries . In addition, decentralisation reveals how capital gains
access to that labour, while at the same time attempting to `run
down' the large factory proletariat, in an effort to restore the
competitiveness of mature technology commodities in European
markets .
If the aim of decentralisation is ultimately the destruction
of the large factory proletariat, its consequence is the recompo-
sition of the industrial working class along new lines and div-
isions . As we have seen decentralisation takes many forms and to
each of these forms correspond different and often new, types of
worker . The splitting-up of the production cycle, which is often
combined with a restructuring of the labour process creates
highly mobile small production units . As Amin (1983) shows, the
firm undertaking splitting-up may then search out a particular
labour force that embodies the socio-economic characteristics
that it considers to be optimal for profitability, taking the fixed
 CAPITAL & CLASS

94 capital to the labour force rather than risking its `contagion'

through migration and education in the large industrial town .
Putting-out creates a whole myriad of workers who are
seldom immediately visible . In the small firm the labour process
and conditions of work vary enormously between firms in the
same industry, while the composition of the labour force, its
traditions, experience and aspirations largely remain a mystery .
An `apprentice' working in a tiny firm in Turin expresses some of
the contradictions that are lived by a small firm worker,
`The tiny firm is an inferno, but it is also a hope, and
something near to yourself . Yes, but I know . . . that here
the work is also being deskilled, but the idea still exists that
you can learn a skill here, that they'll teach you something .
You're a worker, but at least you can hope to become a
good one . Its not really like this deep-down, and everyone
knows it, but where do you go if not here? Do you think
Fiat's better? The big factory, in a certain sense, scares
everyone ; these days you only go when you've given up
hope . . . . Here they exploit you but you're part of town,
your place . You're treated badly, slapped around, but in
that place, you see yourself in the work you do .' (II Mani-
festo, 16 .5 .80)
Paternalistic relations are common on the shop-floor, with ab-
solute power resting in the hands of the entrepreneur, whereas
familial and social ties often link worker and boss outside the
factory . In the small firm the relation of labour to capital is often
unmediated by unions and labour legislation . It is factory despot-
ism without the large factory and implies the reproduction of the
mass, but non-collective, worker at a higher stage of the real
subordination of labour to capital where the labour process is
fragmented between many small production units, or into the
minute division of labour between outworkers and artisans who
supervise their own exploitation .
Graziosi (1979) who has done some fine work on restruc-
turing in Italy, makes an important point when he says,
`The kernel of the strategy of decentralisation lies in the
marginalisation, the increasing precariousness of vast social
strata starting with the young, women and the old .' (p .152)
It needs to be stressed that the marginality of these social strata is
not economic - since they play a vital role in capitalist
acuumulation - but rather it is political and social ." The Bologna
engineering industry illustrates the complexity of the composition
of just one part of the proletariat and the divisions and potential
for marginalisation that exist in it are many . In it are found so
called `unskilled' women workers doing assembly work in the
submerged economy, N . African men in small foundries, workers
 DECENTRALISATION

in artisan shops supervising numerically controlled machine tools, 95

workers with strong economic and cultural ties with the land
working in remote rural factories, plus the workers in the larger
factories with their militant uniion tradition and relatively privi-
leged position . It is conceivable that at one time all these workers
might have been employed in the same factory and joined by the
formal and informal networks and organisations that workers
establish, from which their demands and grievances are voiced
and from which a collective response is developed . With workers
in a firm scattered territorially, socially and culturally, in different
conditions of work and often invisible from one another, the
problem of uniting a single workforce, let alone the class, is
daunting . This raises the question as to whether the shop-floor
organisation of unions - in Italy, the factory council and its
delegates - can be an effective unifying organisation if it is
confined to one factory when the production cycle is being
fragmented between plants and firms and domestic outworkers .
The recomposition of the Italian industrial working class is
then exacerbating and creating new divisions which are leading
to the growth of new sections of the proletariat and to the future
weakening of a declining and besieged large factory proletariat . A
first conclusion that can be drawn from this is that any faith in a
recuperation of the union movement `in the economic upturn' is
fundamentally misplaced and it is sadly ironic, but indicative,
that the Fiat workers were beaten when the Italian economy was
experiencing a mini-boom . A `clawback ; is made unlikely because
the mass-collective worker is being displaced and probably no
longer has the strength and cohesion to lead the industrial working
class : in future struggles . This does not imply however that the
decline of the large factory and the mass-collective worker can be
equated with the end of the shop floor or class struggle . Rather
the problem is finding the strategy and organisational forms that
will allow new and changed members of the proletariat to express
their needs and desires and unite with the older sections of the
class to fight for common ends .
The Italian experience shows that this is a difficult task and
many mistakes have been made . Unions forged out of the struggles
of the mass-collective worker have too often tried to impose
unsuited strategies and organisations on small firm and diffused
workers, while obstructing the creation of organisational forms
more suited to their particular circumstances and grievances .
This can be seen especially in the failure to form horizontal
organisations that link workers in different firms at the local level
in Italy, particularly in areas where decentralisation has led to the
weakening of informal social and political networks that link
workers and collectivise their experiences . In Britain it can be
 CAPITAL & CLASS

96 seen by the continuing lack of official support for combine com-

mittees . (See Lane, 1982 :8)
The Italian labour movement has been quick to recognise
that `diffused' workers exist but for many reasons it has been
extremely slow to find out what these workers want from the
unions . A consequence of this is that there is a great deal of
misunderstanding between the labour movement, which some-
times seethe `diffused' workers as docile, passive and of marginal
significance, and the `diffused' workers themselves, who see the
labour movement as being deaf and blind to their grievances and
vulnerability .
Britain is not Italy and the mass-collective worker has not
dominated the British labour movement to the same extent as in
Italy, but this paper has suggested that decentralisation, auto-
mation and information technology are particularly effective
means for attacking organised labour's power and autonomy,
through the expulsion and dispersion of labour from large
factories, sites and industrial towns . In Britain, the US and
Japanese firms in S . Wales and Scotland are the result of but one
type of decentralisation, while the domestic outworkers recently
reported to be earning less than £35 a week are another . The
textile firm director who `optimistically' told the Financial Times
(4 .8 .82),
`I have this vision that St Helens could become the Hong
Kong of the North West'
is the voice of a growing submerged and dispersed economy .
The British industrial working class is iteslf being rapidly
restructured but the labour movement still largely clings to craft
organisations and traditions . Holland (1982) and Lane (1982)
have both recently drawn attention to decentralisation in Britain
and raised serious doubts about what Lane calls the unions'
attempts to,
`take themselves by the scruff of the neck and shake
themselves into the shape necessary to cope with what is
effectively a new environment .' (p .13)
This paper suggests that the reshaping of industry and the
working class may accelerate further and faster than has yet been
generally realised by the labour movement and the left in Britain .
Hopefully the issues are becoming clearer, even if the answers
seem to be a long way off.

I gratefully acknowledge the financial support of the SSRC for this

research . And many thanks to Ash Amin, Bob Mannings, Donald
MacKenzie, Mario Pezzini, Harvie Ramsay and everyone else who
read and commented on earlier drafts of this paper .


DECENTRALISATION

97
(1) For other articles on decentralisation in Italy in English see Amin Notes
(1983) Brusco (1982) Goddard (1981) and Mattera (1980) .
(2) "`Small is lovely' says Soviet economist" Financial Times 9 .12 .82 .
(3) Blair (1972) says, p.113
"Beginning with the new technologies of the Industrial Revolution, the
veneration of size has come to take on the character of a mystique, and,
like most mystiques, it has come to enjoy an independent life of its own ."
(4) See Brusco in FLM Bergamo (1975) p .45-7 . Prais (1976) p .52-3
Blair (1972) ch . 5 and 6 and Marx (1976) p .603-4 .
(5) see Marx (1976) p.604-5 for a discussion of the Factory Acts and
the effect they had on domestic industry .
(6) For a typology of small firms see Brusco and Sabel (1981) . They
suggest a lot of small firms in Emilia are relatively independent whereas
Del Monte (1982) is less optimistic about the position of small firms in
the South of Italy (p.125) . And many small firms in Japan are `wholly
dependent on a single buyer' Patrick and Rosovosky (1976) p .509-513 .
(7) In Japan there has been a `rather rapid filtering down' in the form
of numerically controlled machine tools from big to small firms
(Financial Times Survey (1981) . Macrae (1982) cites the example of the
small Japanese firm where a leased, second hand robot system hammers
out components in a 'backshed' workshop .
(8) For work on Britain in this area see Massey and Meegan (1982)
Fothergill and Gudgin (1982) and Lane (1982) .
(9) `us Auto makers reshape for world competition', in Business Week
21 .6 .82 . See also Griffiths (1982) .
(10) See Manacorda (1976) . See also the excellent pamphlet produced
by the Joint Forum of Combine Committees (1982) .
(11) Quote from a union militant in Turin, in Il Manifesto,
special supplement on Cassa Integrazione, 1982 .
(12) Cited in, `Fiat Follows Japan's Production Road Map' Business
Week 4 .10 .82 . See also Sunday Times Business News 10 .10 .82 and Amin
(1983) .
(13) For a discussion of Taylorism, the mass-collective worker and the
changing class composition in Italy see Ferraris (1981) Rieser (1981)
Santi (1982) and Accornero (1979) and (1981) .
(14) This process of marginalisation and division has been aided by
left analysis where `women are seen as marginal workers and hence as
marginal trade unionists' . (csE Sex and Class the labour process debate
has limited its analysis to those labour processes, that are found in big
factories largely employing men . The fact that in Britain, men have
largely theorised this labour process, while women have been largely
responsible for an analysis of domestic outwork is indicative of the
difficulties facing the labour movement and the left . It is vital that left
theorists should avoid reproducing the very divisions they are studying .

Accornero, A . (1979) `La classe operaia nella societa' italiana' Proposte References
n .81
Accornero, A . (1981) 'Sindicato e Rivoluzione Sociale . Il caso Italiano
degli anni '70" Laboratorio Politico n .4.
Amin, A . (1983) `Restructuring in Fiat and the Decentralisation of
Production into Southern Italy' in, Hudson R and Lewis J,
C & C 19 - G
 CAPITAL & CLASS

98 Dependent Development in Southern Europe, Methuen, London .

Bagnasco, A . Messori, M . Trigilia, C . (1978) Le Problematiche dello
sviluppo Italiano Feltrinelli, Milan .
Blair, J .M . (1972) Economic Concentration ; Structure, Behaviour and
Public Policy Harcourt Brace Jovanovich, New York .
Brunetta, R . Celata, G . Dalla Chiesa, N . Martinelli, A . (1980) L'Impresa
in Frantumi Editrice Sindacale Italiana, Rome .
Brusco, S . (1982) `The Emilian Model ; Productive Decentralisation and
Social Integration' Cambridge Journal Of Economics n .2, June .
Brusco, S . and Sabel, C . (1981) `Artisan Production and Economic
Growth' in Wilkinson (1981) .
Celata, G . (1980), 'L'operaio disperso', in Brunetta, R et al .
Ciborra, C . (1979) L'automazione nell 'industria dell 'auto' Sapere
n .816 .
CSE Sex and Class Group (1982) `Sex and Class' Capital & Class n . 16 .
Del Monte, A . (1982) Decentramento internazionale e decentramento pro-
duttivo II caso dell'industria elettronica Loescher, Turin .
Dina, A. (1981) Lotta operaia a it nuovo use capitalistico delle macchine'
Unita' Proletaria 3/4 1981 .
Ferraris, P. (1981) Taylor in Italia : conflitto e risposta sulla organ-
izzazione del lavoro `Unita' Proletaria 3/4 .
Ferrigolo, A . (1982) 'Sogno italiano per famiglia veneta' 11 Manifesto
3 .6 .82 .
Financial Times Survey : Japan the Information Revolution 6 .7 .81 .
FLM Bologna (1975) Occupazione, Sviluppo Economico, Territorio sEUSi,
Rome.
FLM Emilia Romagnia (1981) Quaderni di Appunti, Bologna
FLM Bergamo (1975) Sindacato e Piccola Impresa De Donato, Bari .
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London .
Frobel, F. Heinrichs, J . Kreye, O . (1980) The New International Division
of Labour cup Cambridge .
Goddard, V . (1981) `The Leather Trade in Naples' Institute of Develop-
ment Studies Bulletin 12,n .3
Graziani, A . (1982) `La macchina dell'inflazione e la mano invisibile dei
padroni .' Unita' Proletaria n . 1-2, September .
Graziosi, A . (1979) La Ristrutturazione nelle Grandi Fabbriche 1973-6
Feltrinelli, Milan .
Griffiths, J . (1982) `Robots March into European Factories' Financial
Times Survey of the Motor Industry 19 .10.82 .
Hall, S . (1982) `A Long Haul' Marxism Today November .
Joint Forum of Combine Committees (1982) The Control of New Tech-
nology .
Lane, T . (1982) `The Unions : Caught on the Ebb Tide' Marxism Today
Sept .
Leoni, G . (1978) `Economic sommersa, ma non troppo' I Consigli 57/8 .
Macrae, N . (1982) `Intrapreneurial Now' Economist 17 .4 .82 .
Manacorda, P . (1976) 11 Calcolatore del Capitale Feltrinelli, Milan .
Manwaring, T . (1981) `Labour Productivity and the Crisis at BSC :
Behind the Rhetoric' Capital & Class 14 .
Marx, K . (1976) Capital Vol . I Penguin, Harmondsworth .
 DECENTRALISATION

Massey, D . and Meegan, R . The Anatomy of7ob Loss Methuen, London . 99

Mattera, P . (1980)'Small is not beautiful : decentralized production and
the underground economy' Radical America October/September
1980 .
Paci, M . (1975) 'Crisi, Ristrutturazione e Piccola Impresa' Inchiesta
October/December 1975 .
Paci, M . (1980) Famiglia e Mercato del Lavoro in un'economia periferica
Angeli, Milan .
Patrick, H . and Rosovsky, H . (eds) (1976) Asia's New Giant Brookings
Institute, Washington .
Perna, N . (1980) `L'operaio, punto debole du una macchina altrimenti
perfetta' Quaderni di Fabbrica e Stato 14 .
Prais, S . J . (1976) The Evolution of Giant Firms in Britain 1909-1970 cup,
Cambridge .
Prais, S .J . (1982) `Strike frequencies and plant size : a comment on
Swedish and UK experiences' British Journal of Industrial Re-
lations March, XX, I .
Revelli, M . (1982) `Defeat at Fiat' Capital & Class 16 .
Rieser, V (1981) 'Sindacato e Composizione di Classe' Laboratorio
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Rubery, J . and Wilkinson, F . (1981) `Outwork and Segmented Labour
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Santi, P . (1982) `All'origine della crisi del sindicato' Quaderni Piacentini
Wilkinson, F . (1981) The Dynamics of Labour Market Segmentation
Academic Press, London .
Wood, R .C . (1980) `Japan's Multitier wage system' Forbes August 18th .
Young, K . (ed) Of Marriage and the Market CSE Books, London .
Young, K . (1981) `Domestic Outwork and the Decentralisation of Pro-
duction' Paper presented to ILO Regional Meeting on Women and
Rural Development, Mexico .
Zollo, G . (1979) 'Informatizzazione, Automazione e Forza Operaia'
Unita' Proletaria 3/4 .

Industrialisation, women
and working class
politics in the west of Ireland
A mass entry of women into industry
has been the result of state-sponsored
industrialization in Ireland . This study
of women at work in multinational
enterprises in Co . Mayo examines the
implications for trade unionism . It is
argued that while women have
weakened the possibilities for trade
union militancy in the private sector,
the increased female presence in the
labour force will have a positive long
term effect on working class politics in
the Republic, since women now have a
voice outside the home .
100
Lorelei Harris
SINCE 1958, Ireland' has experienced a
prodcess of rapid, state-sponsored in-
dustrialisation . This article is about one
aspect of that process . It looks at the
regional effects of contemporary indust-
rialization in the west of Ireland and,
more specifically, at the implications of
these effects for British working class
politics .
The main thrust of the Irish state's
strategy for industrialisation has been
premised on the development of an in-
ternational system of production in
transnational corporations and on the in-
creased potential which this has implied
for the location of branch plants on the
European periphery . Embodied in the
planning policies and activities of the
Industrial Development Authority
(IDA), 3 this strategy has consisted
primarily in attracting foreign capital
through a range of grants and incentives
made available to potential investors on
a sliding scale depending upon location

throughout the Republic .' It has been
aided at different times by a varying
combination of factors such as proximity
to European markets, the possibility of a
relatively cheap and/or malleable
European labour force and appallingly
low level of environmental legislation .
The result has been two major
patterns of foreign investment . The early
1960s and 1970s saw small firms locate in
Ireland mainly because of export profit
tax relief (EPTR) and low labour costs in
comparison with other European
countries . In the mid 1970s, however,
this pattern gave way to one of large-
scale, high technology units of multi-
national corporations . This may be
explained partly by rising labour costs
and the fact that EPTR, which is due to be
phased out completely by 1990, is no
longer made available to incoming firms .
More importantly, the critical incentives
to invest during the earlier period were
superseded in the mid 1970s by con-
siderations such as Ireland's membership
of the EEC, its lack of environmental
and/or effective health constraints on
industry, the possibility of non-
repayable grants of up to sixty per cent
on fixed assets and, since 1978, the intro-
duction of a low rate corporation tax of
ten per cent for manufacturing industries
which is guaranteed until 2000 .
It is against this background of a high
level of dependence on foreign capital
and of state intervention in the economy
that the social effects of Ireland's indust-
rialisation have to be viewed .
One of the most important has been a
restructuring of the Irish working class
in terms of sectoral composition, geo-
graphical distribution and gender com-
position . New industry has meant a
growth in the private manufacturing
sector, though the extent of this is
frequently exaggerated . It has also res-
INDUSTRIALISATION AND WOMEN
ulted in a massive growth of state sector 101
employment to service incoming in-
dustry . At the same time, the IDA's lo-
cational policy has led to a partial de-
industrialisation of Dublin and the
creation of an industrial labour force in
areas such as the Shannon region, Galway
and north Mayo . Finally, the mainly
semi-skilled character of the new manu-
facturing work has, as elsewhere, res-
ulted in a mass entry of women into
industry .
This restructuring has had important
consequences for trade unionism . The
past thirty years have seen increasing
trade union militancy in the state sector
which has not been matched in the
private sector . This can be explained
partly by the effects of branch plant
location on working class organisation
(Wickham : 1980) and by the muzzling
nature of industrial agreements . How-
ever, by assuming a totally male working
class and/or by aggregating women to
men, most analyses underplay the sig-
nificance of gender in the uneven
development of trade union militancy .
This article is an attempt to redress
the balance . It looks at the entry of
women into industry in north Mayo' and
the implications of this for trade union-
ism . In describing the factory work
which women do and the way they view
their work it will be argued that in the
context of recent Irish industrialisation,
women have weakened the possibilities
for trade union militancy in the private
sector . In other directions, however, the
very fact of an increasing female presence
in the labour force' has positive long
term implications for working class
politics in the Republic .
Industrialisation and the Wild West
In the IDA Regional Industrial Plans
1973-1977, County Mayo was earmarked
 CAPITAL & CLASS
102 as one of six counties requiring `special
remedial action' to alleviate `regional im-
balance' (IDA : 1972 : pt .I : 28-37) . Be-
tween 1961 and 1971, Mayo had the
second highest levels of population de-
cline and unemployment in the
Republic . Of its working population,
with 56 .4 per cent in agriculture, forestry
and fishing and 28 .7 per cent in services,
only 14 .9 per cent were involved in in-
dustry . The industry which existed was
mainly in areas which employed men :
water and electricity supply ; turf pro-
duction ; building and construction . The
majority of the `gainfully occupied'
female population (15 .6 per cent of the
total female polulation at the 1966
census) worked in the service sector .
Mayo thus became one of the IDA's
`designated areas' in which greater in-
centives are offered to potential investors
than elsewhere in the state . In relation to
north Mayo, the `special remedial action'
meted out by the IDA consisted in group-
ing together four towns and placing a
combined planning target of six hundred
new manufacturing jobs on the towns
and their rural catchment areas (IDA ;
1972 : pt 2 .20) . Through both IDA plan-
ning and local efforts, 7 two multinational
branch plants were established and al-
ready operative firms within the town
grouping were given small and/or new
industry grants .
The short term effects were dram-
atic . By 1979, north Mayo was heading
for the peak of a boom period . With an
increasing number of returned emigrants
and migration from neighbouring
counties its population grew at a faster
rate than at any time since the famine of
the 1840s . An already well-developed
service sector expanded further to cater
for the newly established industries and
the buying power generated in wages
and salaries . In turn, this meant that
more non-unionised tertiary sector jobs
were created for women . Since the
factories had not been too carefully sited,
the romanticised west of Ireland
marketed by Bord Failte (Tourist Board)
was transformed overnight into the IDA's
wild west, attracting a multitude of cow-
boys to the new industrial frontier . As
one of the local inhabitants drunkenly
put it : `These factories are the IDA's
paper tiger' .
In industry, the initial effects were to
be seen in job creation and a changing
gender composition of the manufactur-
ing industrial labour force . By 1979, the
multinationals had generated approxi-
mately 2,100 jobs of which 1,785 were
held by women . The reasons for this
large-scale entry of women into new
industry are clear . Firstly, the new firms,
involved variously in the manufacture of
medical and pharmeceutical products
and synthetic fibre, provide predomin-
antly `feminine' work : that is, semi-
skilled jobs entailing high levels of
manual dexterity and an ability to work
at speed . Secondly, with some of these
firms involved in continuous production,
a relatively malleable labour force is im-
portant : women, as will be shown, suited
the bill . Besides the multinationals, a
further eight companies were employing
a mainly female labour force for similar
kinds of work . These offered approxi-
mately 672 jobs of which 541 were held
by women .'
This, then, was the picture in north
Mayo from the time the factories first
opened in the mid 1970s until the middle
of 1980, when closures and redundancies
finally came to the west of Ireland .
Women were recruited into factory
jobs through personal contacts (friends
and/or relatives already working),
through individual enquiries to per-
sonnel officers, through the National

Manpower agency (state employment
bureau) or through advertised interviews
held regularly in one of the local hotels .
While most women workers were young
(under tenty-five) and single, there were
also a considerable number of older and
married women working in the factories .
Slightly more than half of the women
tended to come from farm backgrounds
and commuted to work . Alternatively,
they lived in Ballina (the main town)
during the week and returned home at
weekends . The remainder was drawn
from working class families in the towns,
and, to a lesser extent, from lower middle
class families .
Before recent industrialisation, the
north Mayo working class was pre-
dominantly male and employed mainly
in state sector industry . By contrast, the
newly emerged working class is pre-
dominantly female and employed in
private industry . While the creation of a
new working class in such areas has
obviously increased the numerical
strength of the working class in the
Republic, this does not necessarily imply
an increase in trade union militancy . One
woman worker highlighted some of the
main problems experienced in the new
factories :
In a factory like Naguishi 9 there's an
awful lot of people who have an agri-
cultural background and who do part-
time farming and that . There's a dif-
ferent traditon . . . We haven't had
fathers and grandfathers who've been
fitters in Guinness's (in Dublin) for
twenty-five years .
Women and work
This description is based on a study of
three factories : two multinationals and
an Irish public company with a high pro-
portion of British shareholders . 11 The
INDUSTRIALISATION AND WOMEN
multinationals make plastic medical 103
products and synthetic fibre mainly used
in industry . The Irish firm makes a range
of plastic and vinyl toys and footballs ."
While the production processes
involved do not exhaust the full
spectrum of industrial work open to
women in the area, they are nevertheless
representative of it .
Women's employment is subject to
protective legislation . They cannot be
employed in industrial work between
10 .00p .m . and 8 .00a .m . on consecutive
days or work without a break of eleven
hours between the end of one working
day and the beginning of the next (Con-
ditions of Employment Act : 1936 : pt . III :
section 45(1)) . Within these parameters,
each factory employs female labour in a
different way . In both of the multi-
nationals, women's working day is
divided into two shifts after an initial
training period on days : in one, the day
and evening shifts are rotated on a weekly
basis ; in the other the shift staffs are
permanent . In the third factory, women
work a flat day shift consisting of four
nine and a half hour days and one five-
hour day a week .
The actual work varies from factory
to factory depending on the products
being manufactured . In Brentwood, the
American multinational, female workers
are divided into permanent sections of
between six and ten women who are res-
ponsible for assembling and/or testing
ostomy bags and medical identity brace-
lets for infants . This work is done on
the basis of a daily quota allotted to each
woman within a section and, by impli-
cation, to the section as a whole . In
Naguishi, the Japanese multinational, all
the women workers are employed in the
spinning shop which is divided into four
sections, each containing high tech-
nology spinning machines . As the un-
 CAPITAL & CLASS
104 processed fibre moves from one machine
to another, it is progressively and auto-
matically spun into finer yarn . Here,
women's work consists of patrolling the
machines, making sure the yarn remains
continuous throughout its spinning and
splicing/re-joining it when it becomes
snarled . Though the machines differ
slightly from section to section, women
do the same tasks in each section . As in
Brentwood, there is no task rotation in
Naguisihi . Women in other factories are
only trained to operate one kind of
machine . In Naguishi, however, sec-
tional work is not of the assembly line
type with respect to either the tasks in-
volved or to some kind of implied socia-
bility . The spinning shop has an
extremely high noise level and this, in
combination with the fact that each
woman has to patrol a section of machin-
ery within one of the four sections, means
that the work is highly isolated . In any
case, women's work in West Limited
would dispute an image of the assembly
line as giving rise to sociability, con-
geniality and so on . With the exception
of the football section in West, all of the
women work on assembly lines . Each
line is responsible for assembling or spray
painting a particular toy and the number
of women on a line varies with the item
in production at any one time . Work is
organised on an hourly quota system,
with a bonus scheme for any production
over the quota . Whether because of the
quota system or the bonus scheme,
assembly line work in West creates more
dissention, anxiety and tension than any
other aspect of work in the factory (cf.
Herzog : 1980) . It is also the only one of
three factories in which tasks are rotated .
Over a period of approximately fourteen
months, most of the women work the
full range of jobs open to them ." In a
context of labour intensive producion,
where skill consists mainly in speed and
speed means more money in their hands,
the women in West resent task rotation
bitterly . They feel (quite rightly) that it
disadvantages them in relation to the
bonus scheme . As soon as they get their
speed up to the required level on one
line, they are moved to another .
These differences aside, women's
work in the factories shares certain
characteristics .
First, women are not employed in
skilled jobs or to serve craft apprentice-
ships . With the exception of (unskilled)
cleaners, they are taken on to do semi-
skilled work which falls exclusively at
the lower end of the semi-skilled pay
scale . All of the jobs done by women
entail mindlessly boring, repetitive and
exhausting tasks which require high
levels of manual dexterity and the ac-
quisition of non-transferable skills .
Second, these skills, though sur-
rounded by an aura of high technology
and glossy sophistication, remain at the
level of hard physical labour . As the
women say, it does not take genius or
extensive training to do their jobs . It is
likely that women aquire the skills they
need before going to work, through their
upbringing in the home (Elson and
Pearson : 1981 : 93-94) . This is suggested
by the appalling training conditions in
all three factories . Yet in-job training is
written into job descriptions and trade
union agreements in the form of pro-
bationary periods with lower wages .
Furthermore, as part of the IDA strategy,
grants are provided for training .
Third, the work done by women
tends to militate against shop floor
solidarity . The divisive implications of
quota and bonus schemes, noise levels
and physical isolation all contribute
towards individualising women workers
through an unremitting combination of

tension and fear .
Fortunately, this is mitigated by the
other side of factory work : the informal
and/or anti-work aspects of a highly
regimented and authoritarian system of
work organisation . Though generated
exclusively at work, these `informal
work practices' remain formally un-
recognised in the scope, organisation and
structure of factory work .
It is possible to distinguish three types
of informal work practice . These are
firstly, practices which are tacitly recog-
nised but not formally acknowledged by
management, such as private transport
systems to and from work, forms of as-
sistance given to pregnant women on the
shop floor and ways of dealing with the
absence of maternity leave . Secondly,
there are a range of informal work prac-
tices which are neither recognised or
acknowledged by management . The
prime example of these is `dossing' : ways
of taking time off between meal breaks .
Thirdly, there are practices which fall
completely outside the sphere of man-
agement authority and exist indepen-
dently of it in overt expressions of
solidarity among workers . Examples are
anniversary and ceremonial cards, col-
lections for wreaths or wedding presents
and so on .
Through such informal work prac-
tices, workers establish bonds of solid-
arity with one another which cut across
the individualising routine of factory
work . Such bonds may operate regularly
for short periods of time, as in the daily
car pools . Alternatively, they may exist
sporadically over longer/shorter periods,
as in task exchange between pregnant
and non-prenant women . Known as `the
crack' (fun/what's going on), their signi-
ficance lies in the definite space workers
negotiate for themselves within the realm
of formal work . These practices do not
INDUSTRIALISATION AND WOMEN
necessarily provide the basis for insti- 105
tutionalised opposition within a trade
union structure . However, they do in-
dicate that women workers can and do
create solidarity among themselves, con-
trary to management myth on the sub-
ject . Given this, why do women working
in the private sector find it diffificult to
become actively involved in the trade
union movement?
Gender and Trade Unionism
Part of the answer undoubtedly lies
with the unions themselves . While there
is growing concern in the labour move-
ment about the position of women in
industry and the low level of active
female participation, individual unions
reproduce gender divisions and in-
equalities through their activities at
branch and shop floor level . This may be
seen clearly in north Mayo .
Between 1976 and 1979, the north
Mayo membership of the Irish Transport
and General Workers Union (ITGWU),
the largest trade union in the area, more
than doubled from 2,000 to 4,500 ." this
increase was largely due to the expansion
of industry and to the existence, until
1980, of closed shop agreements which
the ITGW U had with most of the factories .
Since approximately 1,785 women
entered industrial wage-labour during
this time, semi-skilled women workers
accounted for around 71 .4 per cent of
the new membership . Given this, it is
surprising how little the ITGWU has done
for its women members .
Take three simple ways in which the
unions could act for women in the
factories : creche facilities, paid mater-
nity leave and equal pay .
None of the north Mayo factories has
creches . Furthermore, the question of
day care amenities for the children of
 CAPITAL & CLASS
106 working mothers (and fathers) has not
even arisen at branch or shop floor level .
It is not considered a relevant trade union
issue .
Part of the responsibility for this lies
with the women themselves . There is
still a considerable degree of social shame
attached to the idea of women with pre-
school children going out to work . It
raises the spectre of inadequate mother-
hood and neglected children . Waves of
migration from the West of Ireland have
also taken their toll . Quite apart from
the standard idea that women's place is
in the home, the notion of motherhood
as sacrifice is still very deeply rooted .
For working women with young chil-
dren, wage labour is a question of neces-
sity . It is not something to be `flaunted'
or `celebrated' publicly . An overt
demand for creche facilities at work
would have the following implicatons .
Firstly, it would mean supporting a
demand with which most working
women disagree fundamentally .
Secondly, for working mothers with
young children, it would bring social
shame on themselves and their families .
Thirdly, it would cut across bonds of
solidarity which women workers,
irrespective of age and marital/maternal
status, have fledged among themselves .
The other part of the responsibility
for the lack of creche facilities lies with
the union . The ITGWU articulates a
spurious argument about trade union
democracy : since women have not
demanded creches, the union will not
fight for them . However, when craft
workers want to quit the union for craft
unions the ITGWU is quick to ignore their
wishes and defuse industrial action .
Settling a maintenance fitters' dispute in
a continuous production factory is of
concern to both union and management .
The rights of semi-skilled women
workers are not . Women workers are
expendible ; male craft workers are not .
Women's rights are ignored by the union
because they would rock the trade
union-management boat, carefully con-
structed through a series of `sweetheart'
agreements, worked out before there is
any factory or workers . By the day the
first worker clocked on, bargaining
power had been pre-empted through the
closed shop, pay, sick pay, holiday and
sick leave conditions . In refusing to
tackle `women's issues' the ITGWU has
effectively colluded in the reproduction
of gender inequalities . This will continue
to be the case until such time as the
unions take an unequivocal stand on such
questions . 11
The same conditions apply in
relation to maternity leave . None of the
north Mayo factories has paid maternity
leave ." Women therefore have three al-
ternatives after the birth of a child .
Firstly, they can give up work perman-
ently until social circumstances allow
them to return (for example, children
going to school) . Secondly, they can leave
work for a few months, have their jobs
provisionally held open and return at a
probationary rate of pay . This affects
their rights to redundancy pay and, since
redundancies operate on a `last in first
out' basis, women stand to lose seniority
through childbirth . Thirdly, women can
stay `on the sick' for a few weeks after
giving birth . Few women do this . As
already mentioned, peer group pressure
militates against women returning to
work with a young baby at home . Press-
ure from husbands, relatives and friends
also dictates that women should stay at
home (preferably permanently) after the
birth of a child . In any case most women
find they are too exhausted and, anyway,
cannot cope with work and a new child
simultaneously .

INDUSTRIALISATION AND WOMEN
While the union does nothing about
paid maternity leave, issues of this nature
exacerbate existing gender divisions
within the factories . When one of the
few women shop stewards to have sur-
vived the ribald sexism of her fellow trade
unionists raised the question at a shop
stewards' meeting, she got this response :
. . .There was the usual crack about it . I
forget the actual words but it was a bit of
a laugh and `can't they take the pain' .
And somebody said : `Well there aren't
any married women here anyway, so it's
not a major issue' and I said : `I'm not
talking about married women or single
women, I'm talking about women' . And
somebody said : `The young kids will be
getting up the stick (pregnant)' . You
know, this kind of shit and . . . there's no
enthusiasm down there for it, because as
soon as you mention `women's matters',
as they see it, that's it . And they all sit
back and light fags, you know .
A similar situation applies with re-
spect to equal pay . The Anti-Discrimin-
ation (Pay) Act 1974 came into operation
at the end of 1975 . As elsewhere, it places
the onus upon women to prove that they
are performing like work (Wayne, 1980 :
163-164) . Given the lack of cooperation
between female and male workers, this
frequently becomes extremely difficult,
if not impossible . In north Mayo, only
one factory has equal pay . When women
in Naguishi first raised the issue, the
gender divisions within the factory be-
came very clear :
When it was first annouced that we were
going for equal pay, it was funny . . .
well, it really wasn't funny at all . . . This
shop steward in the same section as me -
he calls himself `the shop steward for the
fellas' - called this meeting at the
Hotel to object to the fact that they
weren't consulted as to whether we
deserved equal pay or not . He got all 107
these guys worked up about it and that it
was eroding their differentials-which
was cock and bull . He just expected the
men to go so they could discuss it among
themselves and settle it and come back
and tell us, you know . We went to the
meeting . And all these fellas got up and
made these speeches and said it was in-
sulting and degrading . This shop
steward made out a speech and said it
just wasn't on and all this kind of thing .
All of the factories in north Mayo
have (or have had) women shop stewards .
However, as the same woman indicates,
they face a series of problems in relation
to the union bureaucracy :
I represent all the women on the shift
and, until lately, I represented women in
the other shift as well . But it was kind of
impossible because I never saw them .
There's a girl who's doing it now . . .
she's only elected two days and she says
she doesn't want to do it any more .
They're a particularly nervy crowd any-
way . People are militant in a certain way
but there's this thing about going into
the office . . . actually going into meet-
ings . Like if ten fellas and one girl went
to a meeting, someone would always
crack a joke . All the fellas would say :
`Oh good, a gang bang' and this sort of
stuff . And they were always at it, so if
you were particularly sensitive, it'd wear
you down pretty quick . So that this is
the thing . Women would like to do it but
they don't want to do it . . . that sort of
way . They (male shop stewards) put shop
stewards (women) through their fingers
like sweets .
According to the branch secretary,
women are encouraged to attend union
meetings and to become actively in-
volved in the ITGWU . To this end, shop

stewards' courses are run locally from
time to time and/or people are sent to
attend courses in Dublin . According to
the women, however, they are frequently
not told when union meetings are to be
held . Alternatively, they find meeting
times set before or at the end of shift
inconvenient in the face of domestic res-
ponsibilities and/or travelling distances
between work and home . They also feel
that discussions of male differentials/
grading and craft workers' problems
have little do with them .
North Mayo is no exception .
Throughout the country, trade unions
are reluctant to take up `women's
matters' at branch and shop floor level .
This has two major effects upon women
workers .
Firstly, as has been mentioned, it re-
produces and exacerbates gender
divisions at work . Through their ambig-
uous attitude to women's rights at branch
level, the unions have effectively licensed
sexism on the shop floor . Women, in
turn, define themselves in opposition to
both management and male workers .
Thus, while women and men share the
same informal work practices, these
assume very different meanings . For
men, `the crack' is a continuation of
forms of male association which exist
outside work . For women, on the other
hand, it is specific to work . It gives them
a way of defining themselves sharply
against male workers and a weapon
against the gender inequalities they see
as emanating from men on the shop floor,
backed by the unions .
Secondy, it leads directly to the situ-
ation lamented by trade unionists at a
national level : a lack of involvement of
women workers in the trade union
movement . Most women see the trade
unions as something completely outside
their world : a bureaucratic hierarchy
INDUSTRIALISATION AND WOMEN
that sometimes fixes things and most of 109
the time does not . In north Mayo, few
women have a notion of the ITGWU as a
nationwide organisation which they in
part constitute through their
membership :
Dublin and Saint John Kennedy and
James Connolly'h are just from another
cosmos entirely and all that's familiar is
if you saw it on the screen . . . Ah, did
you ever know!
Rather, they view the union as simply an
organisation which takes subscriptions off
their wages each week and does nothing
in return . This view has been reinforced
partly by the closed shop :
W e were brought up here at about eleven
o'clock, up to the Transport Office and
signed something and given a slip and
then went home . In fact, it was the
bloody mangement who mentioned the
union . It was as if Transport was a side
office of Brentwood . There was no dif-
ference . You signed for Brentwood, you
signed for Transport . . . `We're all in the
same boat' . Actually, it was worse . I
could have been joining the Gestapo . I
wouldn't have known the difference if I
didn't particularly care . And nobody has
made a conscious decision to join the
union .
However, women's view of the union
may also be seen as part of a vicious
circle of inactivity, initiated by the lack
of concern and interest in the needs of
female members :
I won't say Transport, but I'll say a lot of
people in Transport pay lip service really .
Their heart isn't in it, you know . I think
a union should be radical on things like
this (women's issues) . . . They seem to
be half apologising and have to tread
softly `because we might tread on their
dreams' sort of thing and : `men's ego
 CAPITAL & CLASS
110 after thousands of years is suddenly being
attacked' and all this kind of shit .
Transport Union reminds me of a large
political party . . . a complacent political
party . We'll take for example Fianna
Fail . They're big and they've got a
thousand typewriters and a few com-
puters and this kind of thing . . . they
just don't give a damn .
Women and Ideologies of Work
The attitude of the trade unions is not
the only explanation for the lack of female
activism . A second aspect of the problem
emerges if we look at the ideologies of
work held by women . It lies in the fact
that women go into the factories with a
model of work mapped out in the context
of marriage, the family and domestic
labour . While this may well be con-
venient to `the needs of capital' at specific
conjunctures, women's unconscious
acceptance of their subordination within
a structure of patriarchal relations mili-
tates against strong and militant trade
unionism .
Women take patriarchal ideologies
into work in the form of their attitudes to
wage-labour . They see a woman's place
as that of a male-supported dependent in
the home and, consequently, view fac-
tory work in an extremely short term
perspective . The material reality of long
term industrial wage-labour is com-
pletely irrelevant to this attitude .
Women dream that some man will
shortly come along and remove them to
his home or that their husbands will soon
have the means to keep them at home .
Women in north Mayo go to work in
the factories because there are few viable
economic alternatives open to them in
the area . The service sector has remained
relatively non-unionised and wages are
considerably lower than those in in-
dustry . Furthermore, the higher status
of shop, office and hotel work does not
compensate for the untenable working
conditions which are usually justified
with notions of being `one of the family' .
Trade unionism in industry has resulted
in a clear delineation of worker respons-
ibility and management prerogative .
While women factory workers thus
acquire a dignity and security which is
often denied to women in service in-
dustries, this has not developed into a
notion of a woman's career or indepen-
dence from men . Work is a necessity and
factory work is simply the lesser of the
various evils : you clock on, you clock off
and you get paid once a week ; `the crack'
is better and you meet more people .
Within this general attitude to factory
work, the reasons for seeing it as essen-
tially short term vary in relation to factors
such as age and marital status . Young
single women see it as a stop gap until
something better comes along. Irrespec-
tive of education, this frequently takes
the form of aspirations to enter the lower
professional occupations which have
long atracted Irish women : nursing,
banking and the civil service ." Young
engaged or married women also regard
factory work as transitory, though this is
closely related to the men upon whom
they see themselves as dependent . They
work in factories in order to acquire
household commodities and help pay off
the builders or the mortgage, until 'HE'
can afford to transform them into house-
wives' 8 . For older married women, work
is largely the means to improved living
conditions : new furniture, new and
better housing, educating children, holi-
days and so on" .
In all three cases, work is seen in-
strumentally in relation to marriage and
the family : as something to be endured
until it is no longer necessary, though

this decreases with age . The fact that the
short term becomes longer term does not
alter the notion of temporary wage-
labour . Since women do not see them-
selves as being in permanent factory
work, they tend to regard struggles for
better working conditions as external to
their world unless there are immediate
results .
The second way women import dom-
estic models into work lies in the way
they do paid labour . Wage-labour tends
to assume many of the characteristics
usually associated with domestic labour .
Most women treat their work as a per-
manent service rendered to manage-
ment, beginning with the male super-
visor . Arguments over badly done work
take the same form as they might over
meals being late, shirts not ironed or
money wrongly spent . They are seen as
personal attacks and internalised as such .
Similarly, bonus schemes are not re-
garded as a dubious way of avoiding
payment of good basic wages or as an
unacceptable method of raising produc-
tivity . Rather, women tend to view them
as standing in lieu of verbal praise and as
an acknowledgement of their personal
efficiency . In other words, women accept
male authority in the factory in much the
same way as they accept male authority
in the home . The work hierarchy is
understood in the same terms as the
patriarchal hierarchy of the family : on a
completely personalised basis as an attri-
bute or effect of individual women's
behaviour . Given this, it is perhaps not
accidental that most of the supervisory
and management staff are men . Work is
verbally personalised and specific tasks
jealously guarded, as are tools and work
benches . While men might also do this,
the attributes of good workpersonship
differ significantly between the sexes .
The criteria for women are the same as
INDUSTRIALISATION AND WOMEN
those of an efficient housewife : tidyness, 111
nimbleness, frugality with time and
movement and, perhaps most impor-
tantly, a personal method of getting
through work .
In combination with their disillusion-
ment at trade union reticence in pursuing
issues relating to women, this introduc-
tion of a domestic labour model to deal
with the damands of wage-labour ham-
pers a more active female participation
in the labour movement . Until such time
as one or both of these change, the in-
formal basis of solidarity among women
workers will remain, metaphorically, at
the level of a chat over the garden wall .
Women and Social Power
Before recent industrialisation,
women in north Mayo had a limited
range of alternatives open to them . A
few entered the lower professional ranks
or made advantageous marriages . For
most women, however, the 1950s and
1960s were bleak . Between 1951 and
1961, the number of women employed
in agriculture decline by more than half 20
Though there was a slight increase in
female service sector employment during
the same period 21 , such jobs were scarce
and even more badly paid than they are
today . Three main alternatives were
open to women .
First, they could enter religious
orders . Until recently, most Irish re-
ligious orders were ranked on a quasi-
class basis into choir nuns and lay nuns .
Choir nuns were drawn from (relatively)
wealthy families, paid a dowry on enter-
ing their order and were professionally
employed as nurses, teachers and so on .
Lay nuns entered without dowries and
received housing, clothing, food and an
ambiguous social status servicing their
follow `sisters' in the confines of the con-
 CAPITAL & CLASS
112 vent . The second alternative was emi-
gration . Many women went into service
in Britain . They were recruited through
Dublin-based employment agencies
which placed them with families and
hotels ; through friends and relatives who
were already working in Britain ; through
their own initiative . Other women, par-
ticularly those from Donegal and Mayo,
joined the annual potato `squads' which
moved around Scotland for several
months of the year, picking potatoes on
a jobbing basis . Still others went further
afield to Canada and the United States .
Thirdly, women could marry and make
ends meet within the home . Given a low
and declining female labour force par-
ticipation rate between 1951 and 1966 11 ,
it seems probable that many women
availed themselves of this choice . How-
ever, with high levels of male migration
and unemployment, marriage did not
necessarily represent the best
alternative .
The factories, with all their disadvan-
tages, have given women the right to
work in the geographical area of their
choice . More importantly, industrialis-
ation has resulted in the possibility of a
mass female access to social power for
the first time in the history of the region .
Whatever the myths and realities of
the dominant Irish mother, women in
the home are to a great extent outside
society . Enshrined and sanctified in the
1937 Constitution, the family and
women's position within it have been
privatised increasingly by successive
legislation . It is a familiar story : married
women have minimal welfare rights ; re-
stricted parental rights ; no rights to the
control of their bodies and fertility . In
combination with this legal position,
women in the home are further margin-
alised insofar as they take their class
positions from those of their husbands
and/or fathers . Their social universe is
largely mediated by their kinship and
marital relationships with men . The form
of power they enjoy is thus a specific
form of dominance within an overall
subordination : submission to an ultimate
patriarchal authority structure . While
this will continue as long as existing
family structures endure, the movement
of women into wage-labour is never-
theless an encouraging sign of the appro-
priation of social power .
In north Mayo, this appropriation of
social power by women is almost totally
focussed through money and cash buying
power . Women workers indulge in a
flurry of conspicuous consumption,
adorning themselves and their homes
from the weekly wage packet . Young
women, in particular, buy clothes on an
almost weekly basis for the weekend pub
gatherings and discos . At these social
events, presentation is the key and
women match men, one large round of
drinks following another as if Monday
never comes . Consumption among en-
gaged and married women is slightly dif-
ferent, though clothing remains an
important component . Apart from the
usual social round, the onus is on en-
gaged women to provide lavish weddings
and the trappings of a future home .
Married women, on the other hand, put
most of their money towards the house-
hold budget . However, in keeping with
an ideology of women working for `pin
money', they also use part of their wages
to buy ornaments and modern household
conveniences ; to repaint and repaper on
an annual basis .
In a sense, therefore, material objects
have come to stand as the outward sym-
bols of women's social power . This is by
no means inappropriate . Women's
wage-labour represents an important in-
cursion into the terrain of male social

control . By working outside the home,
women short-circuit the economic medi-
ation of their social world by men . Money
means power : it confers social adulthood
and a degree of independence . In this
context, the significance of changing con-
sumption patterns should not be deni-
grated . Rather, they should be read as
symptomatic of women's transition into
society .
In north Mayo, women's conspicuous
consumption has resulted in a curious
inversion of the forms of labour in which
they engage . Domestic labour has gone
on display and wage-labour has become
hidden . In the factories, home and
hearth are a constant topic of discussion,
with women showing off their purchases
and mulling over future aspirations for
their houses . The last ten minutes of the
working day are dedicated to the creation
of a public face . Cosmetics, hair,
clothing : women transform themselves
once again into housewives and potential
housewives . At weekends, this continues
into the supermarkets, shops, pubs and
discos . Consumption becomes a method
of locating `good' wives and mothers .
Alternatively, it signals single women's
potential in these directions . In a very
real sense, women become what they
buy . Female wage-labour, the means
whereby such levels of consumption are
possible, is swept to one side . So, too, is
the fact that many women effectively
hold down two full-time jobs, working
long hours in the home and the factory in
order to facilitate the scale upon which
domesticity is displayed .
While conspicuous consumption is
one aspect of women's appropriation of
social power, there is another aspect to
this process which might well be of
greater long term significance for Irish
working class politics . As has been indi-
cated in relation to money and cash buy-
C & C 19 - H
INDUSTRIALISATION AND WOMEN
ing power, women's entry into wage 113
labour puts an end to certain forms of
male mediation of their social universe .
This is by no means restricted to an eco-
nomic level . As women go to work in the
factories, they come to occupy a plurality
of class positions independent of those
occuppied by the significant men (hus-
bands/fathers) in their lives . As wage
workers, they become working class in
their own right . In a predominantly agri-
cultural area such as north Mayo, this
has led to the emergence of two kinds of
class contradiction, both of which have
progressive implications . The first of
these are contradictions among the
diversity of class positions occupied by
women in their role as workers, wives,
mothers and daughters . Contradictions
of this kind have been discussed here in
relation to women's participation in the
trade unions . The second type of con-
tradiction which emerges with women's
entry into wage-labour is between gen-
ders : the totality of class positions occu-
pied by women workers as opposed to
those occupied by their (increasingly de-
funct) male mediators . Contradictions
of this kind were nowhere more explicit
than in the 1979/80 PAYE
demonstrations .
The main issue involved in the PAYE
(Pay as you earn) taxation demon-
strations was that waged and salaried
workers bore the brunt of taxation, while
farmers and the self-employed paid vir-
tually no tax . The PAYE system also dis-
criminated against married women and
single people (Bradby and Wickham :
1980 ; Raftery : 1982 ; Rottman and
Hannon : 1982) . The demonstrations
were nationwide and, in Dublin, the first
PAYE demonstration amounted to a
general one-day strike involving 200,000
workers . Initiated by the Dublin Council
of Trade Unions, an organisation close
 CAPITAL & CLASS
114 to the rank and file, these demonstrations
received varying support from the trade
union bureaucracy . However, as Bradby
and Wickham (1980) argue, the PAYE
issue formed the focus of a popular
movement entailing a complex articu-
lation of social classes .
Unlike in Dublin, the March 1979
demonstration was not overwhelmingly
successful in the west of Ireland . The
lack of trade union leadership resulted in
confusion about the issues involved and
what action (if any) should be taken .
ITGWU members in north Mayo were
waiting for the Dublin bureaucracy to
call for an official stoppage but no clear
direction came through in time" . In the
aftermath, many rural workers felt bitter
and angry . They saw the first PAYE
demonstration as yet another example of
the ways in which Dublin excluded and
ignored them . They also became deter-
mined that it would not happen again .
The PAYE movement became the subjec-
tive symbol of rural workers' incorpor-
ation into the Irish working class .
It is against this background that the
remarkable rural support for the second
PAYE demonstration in early 1980 must
be viewed . In Ballina, a town with a
population of approximately 7,500
people, 7,000 workers took to the streets
and closed the business sector for an
afternoon . Though an unofficial
stoppage, it was largely orchestrated at a
local level by the ITGWU with (for once)
the undivided approval of its members .
Yet the accompanying festivity and cele-
bration hid a multitude of ambiguities
and anxieties experienced by the demon-
strators and particularly, the women
involved . The rhetoric of the PAYE
movement was directly mainly against
`the farmers' . In other words, the main
thrust ofits attack on an unfair tax system
was against a range of social practices in
which many women are integrally
involved :
I mean, there's a lot of people down at
work with me who are going out with
farmers . They feel, you know, they can
go out about tax and they'll protest about
tax and at the same time they'll think :
`my father's only got twenty acres of
bog' . They're sort of on the ditch, being
pushed backwards and forwards and
they feel half guilty . When they sit at the
table (in the canteen), they'll say about
how unfair the tax system is and then
they'll suddenly say : `Well, you know
now there's an awful lot of rubbish being
talked about the farmers' . I hear it all the
time . And like its easy for Dublin to go
out and rise a few people in Ballyfermot . 24
Just mention the word `farm' and that's
it . I'm not saying there's anything wrong
with the people in Ballyfermot . It's just
that they've no understanding of agri-
culture, whereas people around here
have . So its no big thing to go into a
factory in Ballyfermot and get everybody
to down tools and out . But I think it
takes a helluva lot to do the same thing
around here and to do it successfully .
Despite these contradictions, the vast
majority of female workers in north
Mayo demonstrated against the tax
system . Many made a conscious attempt
to hide their faces, afraid that relatives
and friends might see them or that their
photographs would appear in the local
newspapers . The ultimate sign of
`betrayal', the second PAYE demon-
stration was also one of the first signs of
the positive direction in which the class
contradictions experienced by women
workers can move .
Conclusion
W e cannot consider the Irish working
class as geographically and sectorally un-

differentiated . Nor can we consider it as
ungendered . It consists of women and
men and, given existing gender inequal-
ities, it is ridiculous to assume a complete
congruity of interests .
The question we need to ask, there-
fore, is : what are the implications of
industrialisation for women in the west
of Ireland? Posed thus, the picture which
emerges is by no means negative .
By facilitating female consumerism,
industrialisation has created new icons
in the west of Ireland . Dolly Parton has
superceded the Virgin Mary ; hedonism
has replaced religious asceticism and
Saturday night fever reigns . With the
advent of the factories, women have
begun to move from a private into a
public sphere . They are out of the home,
appropriating social power by right . The
form which that power takes at present
is irrelevant, since it can develop as long
as women remain visible . At the end of
the day, it is the fact that women have a
voice outside the home which is ulti-
mately of importance to Irish working
class politics .
NOTES
1 . This article was originally written as part
of a project done by the Three Green Fields
Collective in Dublin . I am grateful to mem-
bers of the collective for their constructive
criticism, support and editorial work .
2 . Throughout the article, `Ireland' will be
used to refer exclusively to the twenty-six
county state .
3 . The IDA is one of a series of semi-state
bodies which form part of the Irish state
apparatus . Under the 1969 Industrial
Development Act, the IDA was given respon-
sibility for national and regional industrial
development within the Republic .
4 . For a more detailed account of IDA grants
to industry, see McAleese (1977) .
5 . While the western counties differ con-
INDUSTRIALISATION AND WOMEN
siderably, north Mayo is a good example of 115
post-1958 industrialisation in the region .
First, it has none of the urban peculiarities of
Co . Galway or the rural remoteness of Co .
Donegal . Second, it shows the role of the
IDA's locational policy in industrialising the
western seaboard . Thirdly, it is an area which
has experienced the second pattern of indust-
rialisation (multinational branch plant
location) .
6 . Here it should be noted that the total
female labour force participation rate has not
increased greatly in recent years . Female em-
ployment in new industry represents a
marked increase in specific regional rates .
However, in terms of national statistics, it
masks a serious rundown of female employ-
ment in traditional industries .
7 . It would be mistaken to view post-1958
industrialisation purely in terms of state in-
tervention in the economy . In areas such as
north Mayo, IDA planning policy has been
greatly facilitated by local efforts to attract
industry . Much of this local activity has been
conducted within a framework of community
action .
8 . Interview with trade union branch secre-
tary, north Mayo . All of the figures presented
here are approximate because of (a) fairly
wide monthly fluctuations over a fourteen
month period and (b) discrepancies between
factory records and trade union books . It
should also be noted that these figures refer to
a wider area than the town grouping con-
cerned . They include Achill, Castlebar and
Ballyhaunis . Disaggregated figures were not
made available .
9 . For reasons of confidentiality, the names
of all the factories discussed here have been
changed .
10 . The research for this study was conducted
between March 1979 and May 1980 . It con-
sisted primarily of participant observation
and included a three-month period of work in
one of the factories discussed here . My thanks
are due to the women who allowed me to take
up their time with interviews .
11 . The firm here referred to as West Limited
has closed since the time of the research . It
has recently reopened on a far smaller scale of
operation .
 CAPITAL & CLASS
116 12 . The only jobs which are not subject to
rotation are (a) hand-painting on samples and
(b) some of the spray line jobs .
13 . Interview with trade union branch secre-
tary, north Mayo . These figures incorporate
Achill, Castlebar and Ballyhaunis .
14 . No Irish trade union, with the exception
of the (British-based) National Union of
Journalists, has come out in support of issues
which are elsewhere considered to be basic
women's rights . The prime example of this
appalling lapse is the lack of trade union sup-
port for the legalisation of abortion in Ireland
- an issue which is somewhat separate from
opposing the proposed constitutional amend-
ment to extend the legal bar on abortion .
15 . This was the case throughout the period
of research . While maternity leave has since
become statutory (in order to bring Ireland
into line with the EEC), there is little evidence
of its effective implementation in the north
Mayo factories .
16 . These are all familiar icons of the Irish
labour movement . After John F . Kennedy's
visit to Ireland in 1963, he acquired a status
not far below that of the popular domestic
saints . His picture and plastic busts vied with
the saints for pride of place over many
mantlepieces . He came to represent an almost
archetypal rags-to-riches story of the Irish
boy who had made it so good that he was
elected President of the United States .
17 . Maire, for example, wanted to be a nurse.
She had just failed the Leaving Certificate (A
level equivalent and a prerequisite for getting
into nursing in Ireland) but fostered an idea
that she'd get accepted to do nursing in an
English hospital . When this failed, she man-
aged to get work as a telephonist with the
Department of Post and Telegraphs in
Dublin . She's now worried that she'll be made
redundant in the near future and be back at
square one .
18 . Take the case of Brid : Her father owned a
fifty acre farm about ten miles from Ballina .
When she became engaged to a man who
worked for the local corporation (town
council), her father gave her an acre of land
on which to build a house . Two months before
she was due to get married, the house was
completed . She was working so that they
could afford to furnish it, and, also, to pay off
a bank loan . She wanted to carry on working
in the factory for a year and then settle down
to the business of having children .
19 . Geraldine, a quality assurance inspector
at Brentwood, provides a good example . She
was married to a teacher, had two children
and was pregnant with a third . She didn't
want to be out at work but she and her hus-
band were in the process of building a house
and needed her wages to live off in the mean-
time . She hoped either to get promoted to a
management job or to stop working in the
next few years .
20 . At the time of the 1951 Census of
Population, 52 .8 per cent of the `gainfully
occupied' female population was engaged in
agricultural pursuits . By 1961, this had de-
clined to 40 .6 per cent and by 1966, to 31 .2
per cent (Census of Population of Ireland,
1951 : vol . 111 : pt .1 ; 1961 : vol .111 ; 1966 :
vol .111)
21 . At the time of the 1951 census, 16 .6 per
cent of the `gainfully occupied' female pop-
ulation was involved in services . By 1966,
this had increased to 27 per cent .
22 . In 1951, 21 .3 per cent of the total female
population was returned as being `gainfully
occupied' . By 1961, this had declined to 16 .4
per cent and by 1966, to 15 .6 per cent .
23 . As far as it is possible to ascertain the
ITGWU's position clearly, no official stoppage
was called . It was left up to individual
branches to do what they saw fit . While this
worked extremely well in Dublin and the
ITGWU band led the first PAYE demonstration,
it led to chaos in areas such as north Mayo .
24 . Ballyfermot is an old established working
class estate in Dublin .
References
Bradby, B . and Wickham, J . 1980 `The State
of PAYE' . CSE Conference Papers .
Elson, D . and Pearson, R . 1981 `Nimble
Fingers Make Cheap Workers : An Analy-
sis of Women's Employment in Third
World Export Manufacturing' . Feminist
Review, 7, 87-107 .
Herzog, M . 1980 From Hand To Mouth:
Women and Piecework . Harmondsworth :


INDUSTRIALISATION AND WOMEN

Penguin Books . Rottman, D . and Hannon, D . 1982 `The Im- 117

IDA Ireland 19721DA Regional IndustrialPlans
1973-1977 . Dublin : IDA Ireland .
McAleese, D . 1977 A Profile of Grant-Aided
Industry in Ireland. Publication Series
Paper 5 . Dublin : IDA Ireland .
Raftery, J . 1982 `Patterns of Taxation and
Public Expenditure : Towards a Corpor-
atist Approach' in Kelly, M ., O'Dowd,
L . and Wickham, J . Power, Conflict and
Inequality, Dublin Turoe Press .
pact of State Taxation and Transfer
Policies on Income Inequality in the
Republic of Ireland' in Kelly, M .,
O'Dowd, L . and Wickham, J . Power,
Conflict and Inequality . Dublin Turoe
Press .
Wayne, N . 1980 Labour Law in Ireland.
Dublin : Kincora Press .
Wickham, J . 1980 `The New Irish Working
Class?' . Saothar 6, 81-86 .

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 John Grahl

The general notion

of `restructuring' in
capitalist crises is
often put forward by
Marxists . But what
changes in structure
actually take place?
How rapid are they?
Restructuring in west
And in what
circumstances can
they prepare the way
European industry'
for renewed
economic A CLASSICAL THEME in the Marxist theory of capitalist crisis is
expansion? Taking restructuring . The general notion is that capitalist economies re-
the example of West currently exhaust the possibilities for profitable expansion ; the
European industry ensuing crisis restores the conditions for renewed development
this article looks at
some recent views of by enforcing structural change on the system .
the restructuring Although this view of crisis seems generally fruitful, in
process and surveys itself it does little more than indicate a possible line of enquiry .
some of the To give operational value to the term we have to be precise about
economic trends
the content of the restructuring process, the actual or potential
which are important
for the overall changes which seem central to the outcome of the present,
pattern of change . historically specific, economic upheavals . (A closely related task
is to respond critically to competing views of structural change -
those advanced, for instance, by Kynesians or neo-liberals . )
The following paper offers only a few, very preliminary,
notes towards this more concrete grasp of the restructuring
process . After pointing to some empirical difficulties in the notion
of restructuring it looks at two recent accounts of the restructuring
process - a Keynesian view which focusses on energy consumption
118 in Western Europe and an important Marxist model of crisis and
adaptation in West European industry .
The very limited nature of the exercise should be stressed .
Apart from a brief and somewhat speculative conclusion no
attempt is made to discuss restructuring of the social relations of
production in any inclusive sense . The aim is simply a survey of
economic data relevant to that broader discussion .
 RESTRUCTURING

A preliminary qualification necessary to the restructuring thesis 119

Restructuring
is to acknowledge that restructuring may simply not take place . or stagnation?
The alternative to rapid structural change is stagnation : develop-
ment cannot continue in the old directions, but the changes
required to alter the direction of development are blocked or
retarded . Indeed, powerful economic groups may prefer stag-
nation to a pattern of change which menaces their interests .
An outstanding example of this kind of argument, in the
Marxist tradition, is the work of Josef S Steindl on the us
depression of the thirties .' For Steindl, restructuring - which he
largely understood as the elimination of high cost productive
capacity - was blocked by a failure of competition . In the us
oligopoly prevented the elimination of weaker or less efficient
enterprises, since these were large powerful companies with the
profits and financial resources to withstand the impact of
recession .
Today, and in Western Europe, it may be implausible to
suggest that the same blockage exists . It is doubtful whether less
efficient companies are similarly able to withstand competitive
pressure, given the present intensity of international competition .
Nevertheless, a host of other factors may be working to prevent
or delay the elimination of high cost capacity, in this case via
political pressure and state intervention .
Anyway, it is certainly the case that it is easier at present to
find evidence of stagnation than of accelerated structural change .
The most obvious sign of stagnation is simply unemployment
(Table I) . This is currently over 16 millions in Western Eureope
according to official figures and is projected by the OECD to rise to
17 1/2 millions by the end of 1983 . (Other forecasts take a similarly

TABLE I

Standardised Unemployment Rates, per cent

1965 1970 1975 1980 1982 Q1
W . Germany 0 .3 0 .8 3 .7 3 .1 5 .5
France 1 .5 2 .4 4 .1 6 .3 8 .2
UK 2 .3 3 .1 3 .9 7 .4 12 .4
Italy 5 .3 5 .3 5 .8 7 .4 9 .1
Austria 1 .9 1 .4 1 .7 1 .9 3 .4
Belgium 1 .8 2 .1 5 .1 9 .0 12 .3
Finland 1 .4 1 .9 2 .2 4.7 5 .9
Netherlands 0 .5 0 .9 4 .0 4 .9 8 .9
Norway 1 .8 1 .6 2 .3 1 .7 2 .0
Spain 2 .5 2 .4 3 .7 11 .2 15 .0 (1981 Q4)
Sweden 1 .2 1 .5 1 .6 2 .0 3 .0
EEC 2 .1 2 .7 4 .3 7 .9 9 .0

Source : OECD Economic Outlook, July 1982 .

 CAPITAL & CLASS

120 pessimistic view - for instance the EEC Commission has recently
revised its medium term projections of unemployment upwards
to a figure of 11 % in 1985 .')
Correspondingly, there is stagnation of output . After a
weak, 'non-cumulative' recovery from the low point of 1974/75,
real GDP in Western Europe fell by '/a% in 1981 . Growth was
1'h% in 1982 and very low rates are projected for 1983 and
beyond .
Again there is evidence of a considerable overhang of
excess industrial capacity . The OECD no longer publishes data on
capacity utilisation, perhaps because it is unclear whether idle
capacity is being mothballed or simply scrapped and thus unclear
too what the implications are for potential employment . There is,
however, plenty of evidence of idle capacity, particularly in steel,
petro-chemicals, motors, textiles and shipbuilding . 4 And in a
pattern of behaviour reminiscent of Steindl, there are signs that
individual enterprises and countries may be delaying the closure
of their own plant in the hope that someone else will give way first
and ease the pressure .
On the other hand, there is also some evidence of deter-
mined efforts at restructuring . Firstly, investment as a proportion
of output is being sustained . While fixed investment was hit more
than consumption in the recession of 1974/75 it has recovered
more strongly . The typical depression pattern of falls in invest-
ment far more pronounced than falls in consumption is not
apparent (Table II) .

TABLE II

Fixed Investment as Percentage of GDP

1960 1965 1970 1975 1980
W . Germany 24 .3 26 .1 25 .6 20.7 23 .6
France 20 .1 23 .3 23 .4 23.3 21 .6
UK 16 .4 18 .3 18 .6 19.5 17 .8
Italy 22 .6 19 .3 21 .4 20.6 20 .0
EEC 20 .7 22 .4 22 .9 21 .2 21 .2
West Europe 21 .0 22 .7 23 .1 21 .9 21 .3

Source : OECD Economic Outlook .

Secondly, the strongest component within fixed

investment is, in many cases, for new machinery and equipment
while construction, residential and otherwise, is relatively
stagnant . This may indicate that much of the investment is for
industrial restructuring rather than expansion (Table III - these
are gross figures which include replacement investment but the
latter may, of course, involve cost-reducing innovations) .
 RESTRUCTURING

121
TABLE III

Volume of Fixed Investment (Volume of Fixed Investment in Equip-

ment in Brackets). Index Nos ., 1975 = 100

1976 1977 1978 1979

W . Germany 104 .8 108 .8 115 .1 125 .1
(106.1) (113 .8) (122 .8) (134 .4)
France 103 .5 102 .3 103 .3 n .a .
(109.7) (109 .3) (113 .5) n .a .
Italy 102 .4 102 .0 101 .9 106 .5
(109.2) (109.4) (109 .5) (106 .5)
UK 101 .1 98 .4 101 .9 100 .5
(101 .1) (105 .2) (110 .5) (117 .9)

Source : European Economy, 1981 .

Thirdly, there is a considerable body of informal evidence

of industrial restructuring and reorganisation at the level of
particular enterprises, although its anecdotal character prevents
any assessment of its quantitative significance .
On balance, it is probably true that intense efforts are
being made to accelerate structural change in most West European
economies, but these are as yet insufficient in quantity and
duration to clear the path for profitable expansion of industry .

A correct view of the restructuring proposition must also include Continuity

the major elements of continuity between boom and slump . and change
Many economic trends persist from the fifties and sixties into the
eighties - it is not a question of all trends being reversed, but
rather of the promotion of some previous trends to new signifi-
cance together with the emergence of some new trends . For
example, the trend towards urbanisation of the rural labour force
continues in most West European countries (though at a slower
rate) but this is no longer the decisive factor that it was in the
post-war boom, since the industrialisation of Northern Europe is
basically complete . (Table IV) .
Within industry there are again many signs of continuity
in development . A recent UN survey of patterns of industrial
output in West Europe concludes :'
`The dominating feature . . . is the resilience of the under-
lying trends which were already evident in the 1960s . . .
the basic pattern is much the same for all the individual
countries : manufacturing industry is continuing to shift
away from traditional unskilled labour-intensive in-
dustries, such as textiles and clothing, towards the more
advanced, capital- and especially skilled-labour- intensive


CAPITAL & CLASS

122 industries such as chemicals and machinery .'

The degree of continuity is indicated in Table V . For
several reasons, however, this kind of conclusion and its apparent
refutation of the restructuring hypothesis is open to serious
qualification :
(a) The changes in structure (defined simply as thedistribution
of manufacturing output among sectors) are measured at a highly
aggregate level, with manufacturing industry being divided into
18 broad branches . It is clear that such an approach leaves out a
lot - at this level of aggregation, for instance, British and West
German industry appear to have very similar structures, in spite
of the qualitative difference in their performances .' Again, the
relative expansion of `chemicals' as a whole masks two completely
opposed trends - stagnation in heavy chemicals such as bulk
plastics and syntehtic fibres together with a move towards fine

TABLE IV

Reductions in Agricultural Employment per cent per annum

1970-73 1974-78 1979 1980

Austria -5 .3 -3 .6 -3 .5 -2 .0
France -5 .1 -3 .5 -2 .8 -2 .9
W . Germany -5 .0 -3 .8 -4 .0 n .a .
Italy -1 .9 -2 .1 -2 .7 -2 .7
Netherlands -2 .3 -1 .6 -1 .8 -1 .1
Sweden -5 .0 -2 .1 -2 .4 -0.4
Switzerland -2 .7 -2 .0 -1 .3 n .a .

Source : UN, Economic Survey of Europe in 1980

TABLE V

Rising, Falling and Stable Branch Shares in West European

Manufacturing Industry in the 1960s and 1970s

Output Employment
1958-1970 1970-1978 1958-1970 1970-1978
Textiles - - - -
Chemicals + + + +
Petroleum products + 0 0 0
Basic metals - - - -
Machinery + + + +

Countries included : Belgium, Finland, France, Germany, Italy,

Netherlands, Norway, Sweden, UK
Stable (0) = less than 0 .2% change in the branch share .

Source : uN, Economic Survey of Europe in 1980 .

 RESTRUCTURING

123
chemicals such as pharmaceuticals .
(b) Output levels may not be the best indicator of the crisis-
related restructuring in which we are interested . Major change in
the relative output of different industries is almost necessarily the
work of boom periods . What might happen in a crisis are pre-
liminary steps towards change in the pattern of output - changes
in the distribution of investment and in the institutional frame-
work of the economy which will determine which are the passive
and which the more active sectors in the ensuing expansion .'
(c) The UN comparison of industrial change before and after
1970 raises the question of the proper dating of boom and slump
in the West European economy . Many economists (particularly
Marxists) would argue that the turning-point came in the late
sixties, signalled by the first post-war recession in West Germany
(1966/67) . The relative weight of the oil crisis of 1973/74 as
against purely internal tendencies towards stagnation in Western
Europe is an empirical question - but important restructuring
tendencies were already apparent in the West German economy
in the late sixties when, at least, the era of European 'super-
growth' came to an end . I

Nevertheless, it is convenient to begin by discussing The CEPG view :

restructuring of energy supply and consumption, since a recent Energy as the
assessment of the European economy from the Cambridge key
Economic Policy Group (CEPG) puts energy contraints in the
centre of its analysis of the slump .' Their argument is that the
way out of crisis is an expansion of demand but that this is held
back by the need to restructure the energy sector to economise on
OPEC oil . To what extent is this true?
In physical terms, considerable adjustment has been
achieved . Imports of oil into Western Europe are considerably
lower than they were prior to the first oil shock of 1973/74.
Energy use as a whole has been precariously stabilised . These
achievements, however, were only made through the reversal of
the limited and incomplete recovery of 1976/79 . (Table VI) .
Some further points should be noted :
(a) Energy consumption is partly being held down by the
depth of recession in particular industries such as steel or
synthetic fibres which use a lot of energy .
(b) Much of the energy saving so far has been through
relatively simple economies or substitutions which may be harder
to obtain in the future . There is less sign of the very large scale
private and public investment which would be needed to
drastically reduce West Europe's dependence on imported oil .
(Japanese energy saving has been three times as rapid as
 CAPITAL & CLASS

124 Europe's .)
The gains from physical economies (which have reduced
EEC dependence on imported oil from 61 .7% of primary energy
suppliers in 1973 to 41 .3% in 1981) have, of course, been more
than obliterated by successive price increases (Table VII) .
There can be little doubt that, as the Cambridge Report
argues, these financial outflows have become a major inhibiting
factor to West European economic recovery . 10 But it should be
stressed that the constraint is macro-economic and financial, not
a direct resources scarcity . The increase in the oil bill, massive as
it is, would represent little more than one year's aditional output
at the rapid growth rates of the fifties and sixties . Rather the oil
bill constrains output :
(a) Through the inability or unwillingness of European
countries to increase their indebtedness by increasing all imports
enough to sustain economic expansion . The problem in this case

TABLE VI

EEC Consumption of Energy and Imports of Oil (millions of tons of oil

equivalent)

Consumption Imports
1973 919 .1 585 .8
1975 847 .4 482 .6
1976 902 .0 517 .8
1977 897 .9 481 .1
1978 924 .5 472 .1
1979 969.3 474 .2
1980 925 .9 420 .3
1981 917.0 389 .0

Source : European Economy, 1981 .

TABLE VII

Price of Oil and EEC Net Oil Import Bill

Average price per barrel, us $ Net Import Bill, billion us $

1973 2 .6 12 .6
1975 10 .3 39 .9
1976 11 .4 45 .2
1977 12 .6 48 .9
1978 12 .8 47 .9
1979 19 .5 69 .7
1980 31 .3 101 .0
1981 36 .0 106 .0

Source : European Economy, 198 1 .

 RESTRUCTURING

is not oil imports, but unrequited oil imports, that is the 125
surpluses of the OPEC countries which represent oil not paid for
with goods .
(b) Through the impact of oil scarcity on other countries
which are similarly constrained and thus unable to finance
imports from Europe .
(c) Through the intensification of these financial pressures
which tends to accompany economic expansion as a result of the
sensitivity of the price of oil in Western demand . It seems likely
that any sustained upswing will lead to further price increases
which would mean, at least temporarily, substantial deflationary
pressure on the international economy ."
The first point above leads us to consider - as part of the
restructuring process - the reorientation of West European exports
towards oil-exporting countries . The West European response to
expanding OPEC markets has tended to be rapid . By 1979 exports
to OPEC accounted for 6 .9% of all exports from Western European
countries . In 1980, consequent on the second oil shock, there was
a further 16% expansion in these exports .
In spite of this response, however, most European
countries suffered a drastic decline in their balance of payments
figures as a result of the second shock (Table VIII) . (Britain and
Norway were cushioned by their possession of oil reserves .)
Of particular importance here is the rapid and massive
deterioration in the German payments position since, as the
`dynamo of Europe', West Germany has a decisive effect on the
general level of economic activity . 11
Appealing to this kind of data, the Cambridge group report
puts almost complete emphasis on the `oil constraint' as a uniquely
important factor in the EEC's economic situation . Internal ex-
planations of recession are `not entirely convincing . . . since most
of the internal phenomena to which attention is drawn appear to
be consequences, rather than independent causes, of the slow-
down in growth . This is clearly the case as regards low profits,
lack of investment, low productivity growth and reduced
borrowing ." 3
The Cambridge group study is valuable for its quantifi-
cation of the energy restructuring needed . Acceleration of energy
saving in Europe to Japanese rates would, they estimate, ease the
EEC's payments position by $25 billion by 1985 . This is a large
fraction of what is needed to remove payments constraints on EEC
expansion, although not in itself sufficient for full employment .
Two lines of criticism of the Cambridge position will be
suggested . Firstly, on historical grounds it is one-sided to make
OPEC surpluses the only villain in the piece . The vulnerability of
European economic development to external shock is itself evi-
 CAPITAL & CLASS

126 TABLE VIII

Current Balance of Payments . Billion us Dollars .

1978 1979 1980

Austria 1 .4 - 1 .8 - 3 .6
Belgium - Luxembourg - 0 .9 - 3 .4 - 6.0
Denmark 1 .5 - 3 .0 - 2 .5
Finland 0 .6 - 0 .3 - 1 .7
France 3 .8 1 .5 - 7 .8
Germany, FR 8 .7 - 6 .3 -15 .5
Ireland - 0 .3 - 1 .5 - 1 .2
Italy 6 .4 5 .1 - 9 .5
Netherlands - 1 .4 - 2 .4 - 2 .4
Norway 2 .1 - 1 .2 0 .9
Sweden - 0 .3 - 2 .6 - 4.9
Switzerland 4 .4 2 .4 - 0 .6
UK 1 .2 - 3 .8 5 .3
Industrial West Europe 17 .2 -17 .3 -49 .5

Source : UN Economic Survey, 1980 .

dence of internal economic weaknesses . In particular, low profits

and productivity problems seem to have been apparent long
before the oil crisis of 1973/74 .'° It would be consistent with
many views of the economic cycle and economic crises to make a
distinction between the endogenous tendency of a boom to be-
come increasingly fragile, for example, increasingly susceptible
to financial dislocation ; and the exogenous events which may
precipitate recession ."
Secondly, there is an inadequacy in the general Keynesian
procedure . The typical response of Keynesians to the present
stagnation can be specified as follows : postulate a general eco-
nomic expansion ; identify the immediate constraints which such
an expansion would run up against - internal bottlenecks, rising
wage costs, import penetration or whatever ; the task of restruc-
turing then becomes the relaxation of these constraints .
This approach is incomplete, and may be said to lead to a
conservative bias . What is lacking is a specification of the direction
of the general expansion, the social tasks it will perform . Two
types of discussion are assimilated - the question of renewing
economic development becomes a continuation of the previous
question of sustaining the last phase of expansion . The goal is
simply to expand production and incomes - the nature of the
production is largely unspecified (left, in fact, for market forces
to dictate) . Since Keynesian thought in general, and the work of
CEPG in particular, have been - very deservedly - influential in
the British Labour movement, it is worth while pointing to this
 RESTRUCTURING

limitation which characterises, for example, many presentations 127

of the Alternative Economic Strategy .
Before leaving the specific question of energy, two sub-
sidiary constraints, reinforcing the oil shortage, which are identi-
fied by the Cambridge study can be mentioned . (The suspicion is
that new constraints will come rushing in behind each other until
positive restructuring clearly determines an appropriate line of
advance .) Firstly, the competive strength of West Germany
within the EEC is such that a relaxation of the overall EEC balance
of payments constraint is likely to lose a lot of its potential effect .
Any general expansion of EEC demand would be met to a great
extent by West German industry . Other countries would still,
therefore, be faced with payments constraints at high levels of
unemployment unless the West German economy grew at a
much faster rate . But this is implausible as it would mean con-
siderable over-heating of the domestic German economy . Table
IX indicates that there is, in fact, less room for output growth in
Germany than in other EEC countries .

TABLE IX

Income growth rates required to reduce recorded unemployment to

5% in 1985 per cent per year

Actual growth of real Required growth of real

income 1973-81 income 1981-85
W . Germany 1 .7 3'/z
France 1 .9 61
Italy 1 .6 6'/z
Netherlands 1 .1 4
Belgium 0 .7 7
United Kingdom 0 .2 51
Ireland 1 .6 6 1/2
Denmark 0 .4 4
EEC 1 .3 51

Source : Economic Policy Review, 1981, No .2 .

The second subsidiary constraint implicit in the Cambridge

study could be described as one of the `limits of the mixed
economy' . The need for a massive increase in demand to restore
full employment follows from the limits to job-creation and
job-sharing programmes . It is suggested, quite plausibly, that
this kind of employment programme would require unacceptably
high rates of taxation . If these high taxes are an obstacle to the
rapid growth of public sector employment (or employment sup-
ported by the public sector) then general expansion becomes the
only way back to full employment and it is the need for this
 CAPITAL & CLASS

128 general expansion which makes the problem of energy supplies

so intractable . (Table X) . 16
Thus, even in the exploration of energy restructuring we
come upon very different factors behind the stagnation - on one
hand the consequences of highly uneven levels of European
development, on the other a potential fiscal crisis of the West
European states .

TABLE X

Growth of government and private expenditure 1973-81 (per cent per

annum)

Govt . expenditure Govt . expenditure Privately financed

on goods and on transfers expenditure
services
Germany 2 .9 4 .5 1 .3
France 3 .3 5 .5 0 .5
Italy 3 .2 3 .1 0 .8
Netherlands 2.3 5 .9 0 .1
Belgium 3 .9 4 .8 0 .2
United Kingdom 0.6 4 .9 -1 .4
Ireland 4.0 4 .7 2 .0
Denmark 3 .6 6 .0 -2 .3
EEC 2 .5 4 .7 0 .3

Source : Economic Policy Review, 1981, No .2 .

Over- In contrast to the Cambridge Group's stress on energy as an

accumulation external constraint, there has developed a body of theory, classic-
in Northern ally Marxist in tradition, which starts from an examination of the
Europe intrinsic limits to capital accumulation on the postwar pattern -
the limits to a `model of accumulation' based on the industrial
development of Northern Europe, above all in West Germany . 17
A recently translated book by three German Marxists, Frdbel,
Heinrichs and Kreye, presents an empirical assessment of the
restructuring process from this point of view . 'x
These writers see Northern European expansion as having
culminated in an overaccumulation of capital which led to rapidly
rising labour costs and the rising costs of associated labour-saving
investment (the latter is often referred to by German Marxists as
a `rising organic composition of capital"') .
The restructuring process stemming form this over-
accumulation is characterised by : the emergence of West Gerany
as a major exporter of capital, reversing the net flow of us direct
investment to West Germany and halting the flow of labour in
Northern Europe - either by automation or through a more
 RESTRUCTURING

intense technical division of labour within multinational enter- 129

prises, so that labour-intensive functions are more easily trans-
ferred to other countries .
It should be added that similar types of analysis are
frequently put forward about Japan, where a qualitatively similar
(but quantitatively more pronounced) restructuring involving
accelerated capital exports has been identified ."
The model has some very powerful features - perhaps
most impressively it gives a unified account of several restruc-
turing tendencies without simply attributing them to com-
petition, since it makes this an endogenous factor . Intensified
international competition is seen as a consequence of slower rate
of accumulation in a group of leading industrial countries, to-
gether with a drive towards internationalisation of production by
their major industrial companies . This perspective seems partic-
ularly important in Britain where international competition is
often taken as a given `environment' within which national issues
must be discussed .

The lines of criticism of the overaccumulation-restructuring A new

model which will be developed focus on its exaggeration of the Imperialism?
spontaneity of the restructuring process . (This is a weakness of
some versions of the model, not the approach as such . The work
of Aglietta 21 on the us economy is an example of a less determin-
istic understanding of crisis and accumulation in the same broad
tradition .) It will be suggested that the patterns of capitalist
response which are emphasised are simply not strong enough, or
well enough directed, to overcome stagnation . This emphasis on
innate, automatic restructuring can make the classical Marxist
view very close to neo-liberal views of adaptation which are
similarly optimistic .
Frobel, Heinrichs and Kreye are clearly working with
classical Marxist theories of imperialism in the background . It is
important as a first qualification to distinguish between con-
temporary imperialism in its politico-military aspect (the us,
Britain, France) and the more purely economic expansionism of
West German and Japanese captial .
Data on West German external investment assembled by
Michael Hudson 22 and a critical paper by Grazia Gillies 23 both
suggest that Frobel, Heinrichs and Kreye overemphasise the role
of developing countries in German restructuring . Clearly, the
overall pattern of German direct investment is determined more
by uneven development within the industrialised world than by
the pull of cheap labour in the third world . (This is not to
question Frobel et al's discussion of world production sites but to

C & C 19 - I


CAPITAL & CLASS

130 say that it may not be the most important trend .)

The significance of manufacturing exports from developing
countries to Europe is frequently exaggerated in discussion of the
restructuring process, both on the left and the right . Most of the
exports come from a handful of countries, mostly with 'authori-
tarian' regimes (Table XI) .

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 RESTRUCTURING

TABLE XI
131

Leading Developing Economy Exporters of Manufactures in 1975

Percentage Share 1975 Cumulative Share 1975
Hong Kong (including
reexports) 16 .8 16 .8
Taiwan 13 .0 29 .8
Korea 12 .5 42 .3
Yugoslavia 8 .4 50 .7
Singapore (including
reexports) 6 .7 57 .4
Brazil 6 .6 64 .0
India 6 .3 70 .3
Mexico (including
border) 5 .9 76 .2
Argentina 2 .3 78 .5
Malaysia 2 .0 80 .5
Pakistan 1 .8 82 .3
All Developing
Countries 100 100
Source : The Challenge of Interdependence .

The real weakness of the neo-liberal position is that it

offers no means of adapting to this change in trade patterns (even
when it is quite minor) other than catastrophic unemployment in
the industries affected .

TABLE XII

Evolution of EC Trade Balance with South Korea, Taiwan, Hong

Kong, Singapore
millions EUA
1967 1970 1973 1977 1978
EC Exports
Singapore 105 118 509 916 1,058
South Korea 66 155 184 659 1,001
Taiwan 52 116 343 497 665
Hong Kong 333 529 691 1,167 1,650
Total 556 1,118 1,727 3,239 4,374
EC Imports
Singapore 49 122 359 633 638
South Korea 20 59 238 1,262 1,421
Taiwan 67 143 454 1,079 1,204
Hong Kong 391 609 1,074 2,005 2,230
Total 527 933 2,125 4,979 5,493
Total Balance +29 +185 -398 -1,740 -1,119
Import/Export
Coverage 105% 119% 81% 65% 80%

Source : The Challenge of Interdependence .

 CAPITAL & CLASS

132 The An equally important implication of the overaccumulation

international theory is an intensification of the division of labour within
division of Western Europe itself : West Germany, and perhaps a few other
labour regions in Northern Europe tending to occupy the most advan-
within Europe tageous positions while routine functions making intensive use of
unskilled labour are dispersed to a Southern European periphery
whose economic dependence is thereby increased .
An EEC study in 1979 examined the structure of specialis-
ation in international trade of member countries . 26 Traded prod-
ucts in three categories were separated out : those most exposed to
competition from NICS ; those requiring big inputs of skilled
labour ; and those `fundamental' to control over the international
division of labour (because of technological dynamism or because
they are principal capital goods) . It was argued that strong export
performance in the third category revealed a country's capacity to
`control rather than be controlled by the international division of
labour since a favourable situation in these sectors not only
permits relative independence in achieving specialisation and
possibly changing its direction, but also ensures a degree of
control over the other productive systems through the spread of
their production standards' .
However, this pattern does not seem to be the
consequence of any accelerated restructuring in German trading
patterns so much as of a pattern of export specialisation already
established by 1963, i .e . during the boom .
In this there is a marked contrast with Japan, where the
specialisation pattern changed dramatically between 1963 and
1977 (as much before 1970 as after - which indicates that the
more highly organised capitalists of Japan have been able to
anticipate and forestall some of the emerging crisis tendencies) .
In other words, the widening of the gap between Germany and
the rest of Western Europe appears to be a consequence of
changes in world market conditions and their impact on pre-
existing industrial structures as mucha as any differential
response to the crisis .
(We can qualify these conclusions to some extent - the
classification may not be fine enough to pick up some structural
changes in German industry where there has been `defensive'
restructuring . For example, W . Germany has dramatically in-
creased its productivity lead in textiles, an `exposed' product .
Again, reexports may distort the European data . On the other
hand, the data is accurate enough to define clear market advan-
tages for the US and Japan, as well as British decline .)
The implication is that uneven development in the seven-
ties was very largely a result of qualitative differences in the
development achieved in the fifties and sixties . To some extent
 RESTRUCTURING

these differences were masked by the boom - for example, in 133

Britain we often tended to conflate the economic `miracles'
(super-high growth rates) of Germany, Italy and even Spain . The
macroeconomic mechanisms of high growth in all three countries
may have been similar; but there were massive differences in the
depth of development which only became apparent when growth
slackened .
For example, in 1974 the Spanish balance of payments
collapsed as a result of a series of long-run weaknesses : workers'
remittances from Northern Europe failed ; tourist revenues fell ;
oil accounted for virtually all of primary energy ; the markets for
consumer products such as cars declined ; foreign investment was
choked off. All these weaknesses had been there before; the oil
crisis revealed them dramatically ."
On the other hand, there is still every possiblity that
existing differentials in industrial performance and specialisation
will be widened by the restructuring process now taking place,
unless effective political intervention prevents this from happen-
ing . German industrial companies can expoit their existing lead
to intensify their advantages in the future, while countries like
Spain are prevented by their subordinate position and the extent
of the crisis from mobilising national resources to close the gap .

TABLE XIII

Manufacturing Trade : Export Specialisation Indices

A. Activities exposed to NIC competition
(i) intensive use of unskilled labour
1963 1970 1977
us 0 .70 0 .50 0 .60
Japan 1 .64 1 .15 0 .71
W . Germany 0 .62 0 .73 0 .79
France 1 .13 1 .00 0 .97
Italy 1 .60 1 .64 1 .69
UK 0 .78 1 .03 1 .25
(ii) very low capital content
1963 1970 1977
us 0 .45 0 .32 0 .41
Japan 1 .58 0 .85 0 .23
W . Germany 0 .59 0 .69 0 .87
France 1 .60 1 .30 1 .27
Italy 3 .23 3 .24 3 .37
UK 0 .61 0 .75 0 .93
B. Activities using higly skilled labour
(i) capital intensive
1963 1970 1977
us 1 .20 1 .21 1 .22
Japan 0 .61 0 .62 0 .64
 CAPITAL & CLASS

134
W . Germany 1 .14 1 .11 1 .07
France 0 .99 1 .08 1 .04
Italy 0 .81 0 .71 0 .60
UK 0 .88 1 .10 1 .26
(ii) low or medium capital content
1963 1970 1977
Us 1 .46 1 .65 1 .60
Japan 0 .64 0 .92 0 .96
W . Germany 1 .04 0 .99 0 .96
France 0 .73 0 .77 0 .84
Italy 0 .79 0 .77 0 .74
UK 0 .99 1 .03 1 .04
C. Activities 'fundamental' to the division of labour
(i) products basic to technical progress
1963 1970 1977
us 1 .15 0 .93 0 .95
Japan 1 .47 2 .08 2 .04
W . Germany 1 .43 1 .24 1 .19
France 0.73 0 .88 0 .83
Italy 0.80 0 .99 0 .73
UK 1 .05 0 .96 0 .89
(ii) main investment goods
1963 1970 1977
us 1 .20 1 .34 1 .28
Japan 0 .56 0 .79 0 .91
W . Germany 1 .56 1 .39 1 .33
France 0 .80 0 .89 0 .98
Italy 1 .08 1 .13 1 .04
UK 1 .20 1 .14 1 .09
Specialisation index : Japan's specialisation in group x would be Japan's
share of total OECD exports of x divided by Japan's share of overall OECD
exports of manufactures ; thus an index greater than one indicates a
degree of specialistion . The composition of the categories is not given in
the study except that `products basic to technical progress' include
computers, telecommunications, machine tools .
Source : European Economy, Special issue, 1979 .

There are many reports of this kind of process in W .

German industry which fit very well the basic overaccumulation
model . Domestic production is being reorientated towards output
with high value added making intense use of skilled labour and
new technology ; more simple manufacturing processes, using
less skilled labour are being relocated, automated or closed down .
Examples : 2 B
a) Motors: 81% expansion of foreign production between
1970 and 1978 as against 9% increase in domestic production .
Production by Daimler in Brazil, vW in Egypt, Mexico, the us .
b) Chemicals : In an industry 40% devoted to exports, big
problems with plastics, fertilisers, man-made fibres ; increasing
 RESTRUCTURING

strength in paints, cosmetics, pharmaceuticals, lubricants . Big 135

increases in research expenditure, relocation of production
abroad .
c) Steel: Attempts to recover from slump by moves into
special steels, labour- and energy-saving technology, diversifi-
cation into steel-related industries .
d) Electrical Industry : Big problems in domestic appliances,
entertainment electronics, power generation equipment ; strength
in data processing, measurement and control, communications .
e) Mechanical Engineering : Attempt at recovery linked to
general move towards capital goods .
f) Shipbuilding: Response to declining markets, specialis-
ation in container vessels, roll-on/roll off ships, liquefied natural
gas tankers .
To qualify this picture, however, we can point to the huge
quantitative problems of restructuring an industry which in the
mid-sixties covered the whole spectrum of manufacturing activi-
ties and where high wage costs (an irreversible aspect of over-
accumulation) have been for ten years powerfully re-inforced by
an appreciating mark . It also appears to be the case that German
workers have very little to gain from restructuring on these lines .
Whereas, in less advanced European countries, it is possible for
the labour movement to associate itself with the demand for
accelerated restructuring - at least in certain of its aspects -
German restructuring on this patter must involve wholesale dis-
qualification and unemployment, since demand for specialised
products is unlikely to compensate for the general recession and
accelerated automation .

Both the views of restructuring so far discussed - the external Industry

energy constraint and the regroupment of German capital - place and services
heavy emphasis on restructuring within industry . In both cases
this is because of a concentration on international trade ; manu-
factures are far more preponderant in international trade than in
output as a whole . In the case of the Marxist overaccumulation
theory there is also the weight of a tradition concerned centrally
with the industrial labour process .
However, this may be a misleading and restrictive focus . It
is not clear that restructuring of manufacturing alone is capable
of renewing the dynamic of European economic development .
This question is not raised out of any sympathy with the type of
`zero growth' romanticism which takes for granted the benefits of
industrial growth for the middle strata but sees ecological catas-
trophe in extending them to the masses . Rather the point is
made, firstly, because of the importance of non-industrial sectors
in European production . (Table XIV) .


CAPITAL & CLASS

136
TABLE XIV

Sector shares in value-added and employment

Six EEC countries (excluding Greece, Luxembourg, Ireland, Denmark)
ofGDP
Agriculture Manufacturing Services
1960 1973 1977 1960 1973 1977 1960 1973 1977
Value-added 6 5 4 29 32 31 52 50 53
Employment 17 9 8 30 31 29 43 50 54

Source : Boyer and Petit, Cambridge Yournal of Economics 1981 .

Secondly, the balance between broad sectors is raised

because it may well be a key element in the economic restructuring
process as a whole . There is good reason to associate the boom of
the post-war decades with a specific historical function, that of
completing the urbanisation/industrialisation of Northern
Europe . This task is now complete (in the case of West Germany,
indeed, it may have gone too far, in terms of overall economic and
social balance .)
The suggestion is that manufacturing industry, or major
parts of it, may be incapable of resuming their previous role of
economic dynamo . Rather they may be likely to play a more
passive role, comparable to that of agriculture in the fifties and
sixties . That is, some manufacturing would become dependent
on growth elsewhere for the maintenance of demand, while a
tendency of productivity to outstrip demand would imply a trend
loss of employment .
If this kind of restructuring is on the agenda-which might
be suspected from a comparison of the balance between broad
sectors in Western Europe and the us - then the evidence is that
it has hardly begun . A very interesting paper by Robert Boyer
and Pascal Petit 29 argues that the Western European economy is
still tied to manufacturing as leading force - even though this
close tie may be anachronistic :
`None of the changes in the data for the six EEC countries
taken together lead us to believe that there was a significant
change in the mechanisms of economic growth after
1973 . . . The correlation between annual growth of the
manufacturing sector and annual growth of GDP appears
even stronger when data for 1974-77 are added .' (Table
XV .)
Boyer and Petit reached an open conclusion : either in-
dustrial growth must be resumed or `some new mechanism for
employment creation' provided . It might be argued that building
such a new mechanism is the primary task of restructuring - in
which case much of the industrial change we have been consider-
 RESTRUCTURING

ing has a largely negative significance, removing some barriers to 137

development but not contributing much to specifying its
direction .

TABLE XV

Correlations of sector value-added with GDP growth

Six EEC countries
1960-73 1960-77
Agriculture 0 .00 0 .06
Energy 0 .52 0 .68
Manufacturing 0 .85 0 .93
Construction 0 .06 0 .45
Marketed Services 0 .76 0 .87

Source : Boyer and Petit, Cambridge Journal of Economics, 1981 .

The notes above have concentrated on industrial production, and Conclusion

are, perhaps, relatively uncontroversial . More important is the
framework in which industrial trends are evaluated . The follow-
ing conjectures are offered as consistent with the facts .
The European boom of the fifties and sixties indicated an
approximate correspondence between a particular pattern of
capital accumulation and determinate phase of socio-economic
development . The (relatively unproblematic) content of the latter
was, quite classically, industrialisation . In this period the indust-
rial development of Western Europe was completed, a judgement
which is broadly unaffected by the major divergences betwen
particular regions and countries which remain after the inevitably
uneven expansion .
The first concrete indication that this period was ending,
and thus that the established pattern of accumulation had lost its
historical basis, was pressure on wage costs-particularly in West
Germany, the centre of post-war industrial development . The
fact that pressure came first from the side of costs, and only
subsequently from the failure of markets, is relatively contingent .
It shows that working people had maintained a strong and asser-
tive position during the boom . But the epoch was over in any
case : other, more profound, signs of this were a developing crisis
of motivation within industry (appearing first in Britain where
industrial development was already mature in 1945, but becoming
quite general by the early seventies) and the increasing waste and
despoliation of nature impled by rapid industrial growth .
The European economic crisis, then, has two sides : a crisis
of socio-economic development - in what way can Europeans
build on their constructive achievements? what new tasks and
motivations are appropriate, given the highly developed produc-


CAPITAL & CLASS

138 tive infrastructure? ; on the other hand, there is a crisis of capital

accumulation - how can the major capitals be rescued from their
entanglement with an obsolete pattern of development? ; where
are new sources of profit to be located?
The suggestion here is that the answers to these two types
of question may be radically disjointed . The logic of social de-
velopment requires a wide exploration of the emancipatory possi-
bilities of an achieved industrial civilisation . The drive for
renewed profitability points elsewhere - towards a retardation
and distortion of post-industrial productive activity and a global
reorientation (perhaps towards the Pacific) which will tend to
marginalise Western Europe as a field of accumulation . Long-
run stagnation seems a very real possibility : it would reflect this
incomatibility between the new exigencies of centralised surplus
value extraction and control .
Yet the intensified competition - international and dom-
estic - which results from the crisis tends strongly to suppress any
definition of developmental questions which does not put financial
stabilisation and renewed profitability ('competitiveness') in the
centre of discussion . In countering this archaic, `commonsense',
view of the restructuring process, it is essential to insist on the
wider, more forward-looking, themes which popular discussion
started to raise at the end of industrial expansion and which point
towards new needs and the objective possibility of their satis-
faction : relaxation of the disciplines of industrial production ;
open and decentralised regulation of productive and administra-
tive processes ; an attack on the ferocious inequalities of the
industrialising phase ; forms of economic development which
respect the natural, urban and cultural environment .
Whatever happens, it is likely that existing industry within
Western Europe will play a more passive role, analogous to
agriculture previously . Productivity will decisively outstrip
demand, releasing labour for - what? The use that is to be made
of this potential accession of wealth in the form of human energy
is a central issue of contemporary European development .

Notes 1 My thanks to Cynthia Cockburn, who acted for the editorial

board of Capital and Class, for her help and encouragement . Thanks also
to John Harrison and Hugo Radice, who as referees, made critical
comments on the first draft . I have not responded to all their points as
this would have meant writing at least one completely new paper .
2 Steindl (1952) .
3 `Commission dash hopes of EEC recovery', Financial Times,
3 .11 .82 .
4 Shipbuilding : `In 1980 Community production was 2 .4m . cgrt .


RESTRUCTURING

(compensated gross registered tons) a drop of 18 .4 per cent compared 139

with 1979 and 52 per cent compared with 1976 . The Commission does
not anticipate any change in the situation in 1981' - `Gloomy Days in
Shipbuilding', EC Commission Background Report 11/1/82 .
Petrochemicals : `Europe's loss-making petro-chemical and plastics pro-
ducers have closed 4 .8m . tonnes - 14 .7 per cent - of their effective
capacity over the last 15 months, according to analysis at W . Greenwell, a
stockbroking firm . But Greenwell says that "nowhere near enough"
plants have yet been shut down . It stresses that in the "worst" product
areas between 30 per cent and 40 per cent of capacity needs to "dis-
appear" .' `Europe's Petrochemical Crisis', Financial Times, 5 .4 .82 . p .3 .
Motors : `There is over-capacity in the European car industry, which is
capital intensive and needs to use its plant at a high rate before the
break-even point is reached .' `European Motor Industry', Financial
Times Survey, 13 .10 .82 .
Evidence on textiles and steel is even easier to find .
5 UN (1980) .
6 This point was made by Ajit Singh (1977) .
7 Fine and Harris (1976) made the rather infuriatingly non-
operational remark that the purpose of restructuring in the slump is to
prepare the way for further restructuring in the boom . Nevertheless, it
seems true - the gloss put on it here is that the crisis sees a restructuring
of allocation, preliminary to a new structure of output in the boom .
8 The term 'super-growth' is used by Kindleberger (1967) . For
discussion of early W . German restructuring see Minnerup (1976) and
Droucopoulos (1977) .
9 CEPG (1981) .
10 Ibid .
11 Ibid . p . 14 .
12 This dominance is well analysed by Ricardo Parboni (1981,
Chapter 4) .
13 CEPG (1981) p . 14 .
14 For evidence on the long-run declines in profitability, evident
from the early sixties, see Hill (1979) .
15 `An expansion becomes more sensitive to accidental disturbances
after it has reached a certain stage, and similarly a contraction can be
more easily stopped and reversed by some stimulating factor, after it has
progressed for some time . Therefore, even if we were not in a position to
prove rigorously that expansion generates contraction and contraction
generates expansion, a fairly regular succession of periods of prosperity
and depression, of expansion and contraction, might be explainedby
accidental shocks distributed in a radom fashion over time .' Haberler
(1952) p .347 .
16 But note that in Sweden in 1971 public sector incomes accounted
for 51% of GNP (Lindbeck, 1975) . It is not suggested that this state of
affairs could be easily generalised .
17 This term is used by Samir Amin in Frank (1981) .
18 Frobel et al . (1980) .
19 This is the term used, for example, by Joachim Hirsch (1980) .
20 For example by Makoto Itoh (1980) .
21 Aglietta (1979) .


CAPITAL & CLASS

140
22 Hudson (1982) gives the following table, for example :

Regional Structure of FRG Direct Investments Abroad

(Total assets in Billion DM and %)

Country 1970 1975 1979

Billion Billion Billion
DM % DM % DM
Industrialised Countries
in general 14 .9 70 .6 29 .7 70 .7 47 .9 72 .6
EEC 7 .3 34 .6 14 .8 35 .2 21 .8 33 .0
USA 1 .8 8 .5 4 .2 10 .0 12 .3 18 .6

Developing Countries
in general 6 .2 29 .4 12 .3 29 .3 18 .1 27 .4
Latin America 3 .7 17 .5 5 .5 13 .1 8 .6 13 .0
Brazil 1 .5 29 .4 2 .9 6 .9 5 .0 7 .6
Africa 1 .0 4 .7 2 .1 5 .0 2 .6 3 .9
Asia 0 .4 1 .9 1 .4 3 .3 2 .3 3 .5
ASEAN Countries 0 .04 0 .2 0 .2 0 .5 0 .5 0 .8
Oil-producing countries 0.1 0 .5 0 .9 2 .1 1 .8 2 .7
TOTAL 21 .1 100 .0 42 .0 100 .0 66 .0 100 .0

23 Gillies(1982) .
24 EC Commiston (1980) .
25 For a clear presentation of the neo-liberal position see Wolf (1981)
which mounts a strong critique of the EEC's external commerical policies .
26 EC Commission (1979) .
27 Wright (1977) .
28 Alltakenfrom Financial Times Survey,`WestGermany',27 .10 .80 .
29 Boyer and Petit (1981) .

References Aglietta, M ., (1979), A Theory of Capitalist Regulation : The us

Experience, London, (New Left Books) .
Boyer, R . and Petit, P ., (1981), Employment and productivity in the
EEC, Cambridge Journal of Economics, 6, 1, March .
CEPG (1981), The European Community : problems and prospects,
Economic Policy Review, 7, 2, December .
Droucopoulos, V ., (1977), West German expansionism, New Left
Review, 105, September/October .
EC Commission, (1979), Changes in industrial structure in the European
economies since the oil crisis, European Economy, special issue.
EC Commission, (1980), Community Third World: The Challenge of
Interdependence, Brussels .
Fine, B . and Harris, L ., (1976), The debate on state expenditure, New
Left Review, 98, July/August .
Frank, A .G., (1981), Reflections on the World Economic Crisis, London,
(Hutchinson) .
 RESTRUCTURING

141
Frobel, F ., Heinrichs, J . and Kreye, 0 ., (1980), The New International
Division of Labour, (Cambridge up) .
Gillies, G ., (1982), The new international division of labour and
developments in world trade and international production,
mimeo, London, Polytechnic of the South Bank .
Haberler, G ., (1952), Prosperity and Depression, third edition, London,
(Allen and Unwin) .
Hill, T .P ., (1979), Profits and Rates of Return, Paris, OECD .
Hirsch, J ., (1980), Developments in the political system of West
Germany since 1945 in Scase, R . (ed .), The State in Western
Europe, London, (Groom Helm) .
Hudson, M ., (1982), West German foreign investment since 1960 : tables
and notes, mimeo, University of Leeds .
Itoh, M ., (1980), Value and Crisis, London, (Pluto Press) .
Kindleberger, C .P., (1967), Europe's Postwar Growth, The Role of
Labour Supply, Cambridge, Mass ., (Harvard up) .
Lindbeck, A ., (1975), Swedish Economy Policy, London, (Macmillan) .
Minnerup, G ., (1976), West Germany since the War, New Left Review,
99, September/October .
Parboni, R ., (1981), The Dollar and its Rivals, London, (New Left
Books) .
Singh, A ., (1977), UK industry and the world economy, Cambridge
Journal of Economics, 1, 2, June .
Steindl, J ., (1952), Maturity and Stagnation in American Capitalism, New
edition, London, (Monthly Review Press), 1976 .
United Nations, (1980), Economic Survey of Europe, New York .
Wolf, M.H ., (1982), The EEC and trade policy . Paper presented to the
British Association, September .
Wright, A ., (1977), The Spanish Economy 1959-76, London,
(Macmillan) .
Winston James
This article deals
with the eight years'
and eight months'
rule of the Manley
regime in Jamaica . It
analyses the nature
of the regime and
focusses on its
internal
contradictions . Its
main argument is
that the collapse of
the PNP government

The decline and fall of in 1980 is best

explained not by
external
Michael Manley : interference but by
its internal
contradictions . Like
Jamaica 1972 .1980 other social-
democratic regimes,
it aspired to achieve
A MOST IMPORTANT chapter in the history of Jamaica came to an equality while
abrupt close on October 30, 1980 . The results of the general maintaining private
. In Jamaica
elections held on that date brought to power the right wing property
this
Jamaica Labour Party led by Edward Seaga and ended the eight by rhetorical
promises
wasyerndightmosrulefthPop'sNainlPrtyedb far in
the enigmatic and self-styled `democratic socialist', Michael excess of political
action .
Manley . In the elections of February 1972, the PNP had won
handsomely by a landslide of 36 to the JLP's 17 seats with the
slogans of `Better Must Come' and `Power for the People .' In
addition, on December 16, 1976, the PNP were to extend their
margin of electoral support by once again routing the JLP (by 47
to 13 seats) even more convincingly under the most testing of
circumstances . Yet, in October 1980, the PNP were humiliatingly
defeated by the JLP who took 51 out of the 60 parliamentary seats
under the slogan of `Deliverance .' It is indeed very ironic, even
by Jamaican political standards, that a party which came to
power on the crest of a wave of popular support under the banner
143
of `Better Must Come' was ousted in no uncertain terms by
another demagogically promising `Deliverance .'
Now, how do we explain this major turn-around of events?
How do we account for the crash of the Manley regime in the
most bloody election in Jamaica's history? To my mind these
events cannot be explained in terms of CIA machination, 'de-
stabilisation,' IMF parsimony and vindictiveness, nor even by the
 CAPITAL & CLASS

144 appalling levels of violence which accompanied the elections .

Although the CIA, the IMF and political violence were all signifi-
cant factors in determining the fate of the Manley regime, these
in and of themselves cannot be considered to be adequate explan-
ations of the collapse of the PNP government in Jamaica without
reducing complex processes to the level of mere conspiracies .
The contention of this essay is that the root cause of the fall of the
PNP is to be found within the intrinsic contradictions of the PNP
regime itself. More specifically, it will be argued here that in the
most immediate sense, the rout of the PNP is to be explained by
the fact that the regime, especially towards its bloody close,
served neither the interests of capital nor that of labour effectively .
Indeed, it had managed simultaneously to antagonise both the
historic classes of Jamaican society . On a more complex and less
immediate level of analysis, it will be argued that the crux of the
demise of the PNP is to be found in its simultaneous quest for a
greater degree of equality while maintaining the existing struc-
tures of private property .
Moreover, it will be argued that the electoral catastrophe
of the PNP was symptomatic of the way in which the economy
collapsed . It is therefore, not enough to say that the economic
collapse led to electoral defeat in an unmediated manner . Instead,
we need to point out that it was not economic collapse per se
which drove the working class to vote for the JLP or not to vote at
all, but that it was the fact that the economic crash fell on the
heads and shoulders of the most exploited and destitute of
Jamaican society, and left them with no prospect of amelioration
under the PNP .
What is perhaps even more tragic is the fact that the
capitalist `strike', sabotage and the remarkably high levels of
destabilisation unleashed upon Jamaica by the internal and ex-
ternal bourgeoisies was generated less by concrete policies which
directly benefitted the working class and more by issues such as
rhetoric and international relations which delivered virtually no
immediate fruits to the exploited and oppressed .
In short then, the Manley regime did not answer to the
needs of the working class and at the same time did not comply
with the demands of the ruling class on the terms on which the
latter would continue to operate units of production . This resulted
in a state of total impasse and consequently the economy haem-
orrhaged heavily and the massses teetered on the brink of physical
survival .
It is therefore argued herein, that regimes such as the PNP's
are intrinsically unviable : the PNP did not establish a modus
vivendi with capitalism which would have enabled the latter to
function and at the same time it did not challenge capitalist
 JAMAICA 1972-1980

relations of production to enable production to take place under a 145

higher, socialist, mode of production . Not surprisingly, then,
economic catastrophe ensued, and the regime got voted out of
office . The PNP regime could not `get on' with domestic or foreign
capitalists but at the same time it did not embrace the alternative
of socialism . For the PNP, despite its rhetoric, capitalism was its
system, albeit one that wreaked total havoc in Jamaica . Although
the PNP and Manley declared that they wanted equality they
argued with equivalent vehemence for the prevention of any
infringement of the rights of private property . It was in the end,
this grotesque and seemingly idiotic philosophical antinomy and
explosive political contradiction, of equality and private property,
which brought the PNP regime tumbling down on October 30,
1980 .
The following are some rather dry but important and
immensely telling statistics which give an appreciation of the
scale of the economic and social devastation . Between the years
1974-1980 real Gross Domestic Product (GDP) experienced a
cumulative decline of 19 .8% . One sector of the economy, con-
struction and installation, which is crucial to economic growth
because of its multiplier effects and high level of employment,
experienced between 1972 and 1980 nothing short of a catas-
trophe : it underwent a cumulative decline in production of no
less than 83 .3%! Gross Capital formation as a percentage of the
GDP fell from a level of 35 .1% in 1969 to 15 .7% in 1980 . The
budget deficit increased more than eleven-fold, from J$66 .8m . in
the financial year 1972/73 to a phenomenal J$750m . in 1979/80 .
Net national debt shot through the roof, increasing by over 800%
from J$431 .4m in 1973 to J$3, 8 84 .9m . i n 1980 . Moreover, the
external position of the national debt increased even more
sharply, from J$150 .4m . in 1973 to an astonishing J$1,544 .9m
by the end of 1980 - an increase of 927 .2% . Net foreign reserves,
in correspondence with the economic decline fell from a positive
figure of J$130 .2m . in December 1974, to minus J$961 .1m . by
the time the PNP left office in October 1980 . In the meantime, not
surprisingly, the victims of unemployment increased from 24%
of the labour force in 1972 to 31% in 1979 down to 26 .8% in
November 1980 . Even more significantly real disposable income
per capita fell to the levels they were around thirteen years
previously, in 1967 . And, in keeping with the other macro-
economic indicators, the standard of living of the working class
fell dramatically . Between April 1975 and November 1980 while
wages increased by 98 .5%, prices, over the same period had
increased more than twice as much, by 204 .7% . Real wages had
thus declined by more than one-half in less than six years . Not
surprisingly, between 1974 and 1980 decreases in the real con-


CAPITAL & CLASS

146 sumption of the following basic items occurred, at a time, we

should add, when the population of Jamaica was increasing :
Food 31 .31%
Non-alcoholic beverages 76 .71%
Clothing and footwear 59 .26%
Furniture, furnishings, household
equipment and operation 22 .5%
Source : Calculated from the Dept . of Statistics, National Income
and Product, 1980, Kingston 1981, pp .62ff.

On a more human level, the painful close of the Manley

regime was symbolised by the increase in the number of poor
people suffering from mental illness, many of whom were seen to
roam the streets of Kingston . In fact some, their bodies emaci-
ated, walked the streets of the capital as naked as the day they
were born . This latter phenomenon is arguably hitherto unseen
in Jamaica . Not surprisingly, by January 1980, there were reports
that the island's main mental hospital, Bellevue, had a major
problem in coping with this veritable epidemic of mental illness .
(Beckford and Witter, 1982 :105)
What we have here then, in Jamaican parlance, is a country
that has been definitely `hushed up' . However, to get the statistics
in their full perspective, it must be stated here that in the early
years of the PNP regime, the Jamaican masses experienced an
unprecedented improvement in their standard of living . Wages
had kept well ahead of inflation up to the end of 1976 and the
level of unemployment was reduced from an estimated 25% in
1971 to a low of 19 .9% in April 1975 . However, by the close of
1976, it had begun to move once more, in the pre-1972 direction .
In addition to these early, but somewhat ephemeral successes,
the social wage had significantly increased by, amongst other
things the implementation in 1973 of free school uniforms for
primary school children whose parents could not afford them,
and the introduction of free secondary and university education .
Other noteworthy reforms during these early years, were : com-
pulsory trade union recognition by employers, a national min-
imum wage, paid maternity leave, an adult literacy programme
and a land reform programme - albeit a rather timid one, as we
shall see .

Economic During the two decades to 1972, the Jamaican economy ex-
growth and perienced an unparalleled development in its productive forces
social crises : as measured by the nominal and real growth of the GDP . Between
prelude to the 1950 and 1971 nominal GDP had increased from a meagre
PNP victory J$152 .4m . to J$1,120 .2m, a jump of over 635% . From 1950 to
1968 the average annual rate of growth of the real GDP was a
respectable 6 .7% and between 1959 and 1972 the real GDP had
 JAMAICA 1972-1980

more than doubled from J$407m to J$825 .2m . Real per capita 147
income also increased by more than 100% between 1950 and
1968 ; and from 1950 to 1960 it increased at an annual rate of
5 .4%, slowing down to increase at an annual rate of 2 .9% between
1960 and 1968 . Significantly, however, the dynamic of the
Jamaican economy at this time was largely determined by the
rhythm of the investment pattern in the bauxite-alumina industry
which had expanded quite dramatically during these two
decades . This sector had a profound influence upon the
construction industry which latter in itself has the most all-
embracing effect upon the economy . Therefore, the period of
construction and expansion in the bauxite-alumina industry had
what the Keynesian economist would call an important 'multi-
plier effect' upon the rest of the economy . The problem of course
is that once the construction and expansion phase of the bauxite-
alumina industry comes to a close a crisis is precipitated in the
rest of the economy ; and this is precisely what occurred at the
beginning of the 1970s . (Cf. Girvan, Bernal and Hughes, 1980)
We shall return to this problem later .
For the moment, however, what is important to note is
that despite the secular growth in the GDP, capital formation, and
indeed, emigration on a massive scale from the island, the rate of
unemployment actually doubled during the decade of the '60s,
from about 12 .5% in 1960 to 25% in 1971 . The distribution of
income, not to mention wealth, became even more skewed .
Thus, while in 1958 the top 10% of income recipients gobbled up
43 .5% of the total income received, by 1971-72, instead of de-
creasing, the figure increased to 49 .3% . Not surprisingly, there
was an estimated fall in the earned money income of the poorest
40%, from 7 .2% to 5 .4% . Absolute poverty also grew : between
1958 and 1968 it is estimated that the absolute income of the
poorest 30% of the population fell from J$32 .00 to J$25 .00 per
capita, in constant 1958 dollars . And in 1962, some 60% of the
labour force was earning less than J$20 .00 per week - the amount
of the fixed minimum wage in 1975 . (McLure, 1977 :17 and
Girvan et al . 1980 :115) In the countryside, the distribution of
land, a subject we shall return to, became more skewed and the
income of the peasants and agro-proletariat declined . Thus while
in 1961 the average size of all farms under 5 acres was 1 .8 acres,
by 1968, the average size of such farms had fallen to 1 .5 acres .
Moreover, while in 196170 .84% of all farmers were in the under
5 acres category, by 1968, almost 80 .0% were in this group of
minifundistas . In the meantime, the average size of the largest
estates (i .e . those in the 500 acres and over category) increased
from 2,210 acres to 2,340 acres .
And so when we examine more closely what seems to be a
 CAPITAL & CLASS

148 major economic accomplishment we find that there were clear

manifestations of major stress-faults : high unemployment despite
heavy emigration, with the rich getting richer and the poor
getting poorer, existing cheek-to-jowl beside spectacular aggre-
gate economic growth . In addition, the accusation of economic
mismanagement, political victimisation, corruption on a massive
scale and at the highest levels of public life, coupled with police
brutality against the poor during the JLP regime, were pervasive .
The combination of these factors clearly provided the
recipe for social discontent . And discontent was certainly quite
widespread in Jamaica, especially towards the close of the
'sixties .' In August 1965 there were riots against Chinese business
establishments, and in particular against those in the Kingston
area after a black woman was allegedly beaten up by four Chinese
brothers during a dispute over a radio she was in the process of
buying from them . When the dust was finally settled, numerous
Chinese businesses were looted and/or burnt out, two policemen
were shot (one accidentally shot dead) six civilians were suffering
from bullet wounds, ninety arrests were made, and the fire
brigade had answered over seventy-one calls .
In the following year, there was a wave of disturbances
ranging from massive strikes across the island, to inter-party
clashes over jobs and houses in western Kingston . These latter do
not only reflect the successful division of the working class and
oppressed by both parties ; it also points to the material basis
which facilitates the butchery of worker by worker . That material
basis is, in a word, poverty . The `scarcity' of employment,
housing and other social amenities create the environment within
which it was quite conducive for those in desperate need of them
to be successfully and cynically manipulated by local party bosses .
(Cf. Stone 1980) In any case as a consequence of the disturbances,
a state of emergency was declared on October 2, 1966, which
lasted for the ensuing month .
The most disturbing event of the sixties for the Jamaican
ruling class, however, was not the displaced rising against the
Chinese retail sector, or the disturbances of 1966, but the'Rodney
Riots' of October 1968 . The events were sparked off when
students and radical lecturers of the University of the West
Indies demonstrated on the streets of Kingston against the ban-
ning by the JLP government of Dr . Walter Rodney, the Guyanese
Marxist historian who was brutally murdered in 1980 by the
Burnham regime in the country of his birth . Many of the youths
of Kingston joined the demonstration with enthusiasm and rioted
after the march, which had been up to that point peaceful, was
attacked by thugs from an office of the JLP-aligned Bustamante
Industrial Trade Union and by the police . By the time the rioting
 JAMAICA 1972-1980

had ended over one million pounds worth of damage had been 149
done to property (which, significantly enough, was predomin-
antly owned by North American capital), looting had taken place
on a grand scale, fourteen buses were totally destroyed with
thirty-five others badly damaged, two people were killed and one
seriously wounded . One senior member of the Jamaica Defence
Force four years later in cool hindsight assessed that 1968 was `a
half-cocked urban insurrection . . . but it was leaderless and soon
lost its form .' But half-cocked or not, it certainly shook the
Jamaican ruling class to its very bones out of its illusory, smug
nonchalance of unchallenged hegemony .
When we leave the streets of Kingston with their riots and
running battles in the 1960s and go to the point of production
proper, we find the same increasing expression of dissatisfaction .
As the statistics reveal, there was at the end of the 'sixties a
marked increase in the combativity of the Jamaican working
class . From thirty-seven in 1965, the number of strikes had
increased to 187 by 1970, and involving, not the 25,316 workers
of 1965 but 39,401 and accounting for, not the 290,162 work-
days lost in 1965 but 384,636 . The conclusion is clear : seething
beneath the facade of economic stability was a volcano of growing
dissatisfaction and militant action on the part of the working
class .
During the turmoil of the'60s, the PNP was quite outspoken
about police harassment and the curtailment of civil liberties .
Indeed, in 1968, the PNP MPs had walked out of parliament in
protest over the banning of Walter Rodney . By 1969, Norman
Manley had retired from active politics and predictably, his son,
Michael succeeded him as leader of the party . The PNP by this
time had grown in popularity . And by the time of the 1972
general elections, members of all the social classes of Jamaican
society (including a significant sector of the capitalist class) sup-
ported the PNP, less perhaps for what it stood in its own right than
for what it stood against . The result of this was that the PNP
scored a landslide victory over the JLP in the February election of
'72 .

Now during the election campaign of 1972 the PNP never used the The meaning
slogan `socialism' . There was talk of `popular participation' and of `Democratic
`social justice' but never once was there any talk of socialism by Socialism'
Manley and his colleagues . Indeed, on coming to power, Manley
reiterated time and again that he did not believe in any 'isms' . In
his recent book, however, Manley tells us that at the first
National Executive Committee meeting of his party after the
victory of '72 he urged his party to return to its socialist roots and
 CAPITAL & CLASS

150 to systematically re-examine its ideology . The final product of

this long process of self-reflection on the part of the party came in
late 1974 : the PNP declared to the public that its ideology was
`democratic socialism' . However, the document published by
the party in November 1974, Democratic Socialism: The Jamaican
Model, is more a declaration of principles than a call to action . To
the party, the document reads :
Socialism is first an ideal, a goal and an attitude of mind
that requires people to care for each other's welfare .
Socialism is a way of life . A Socialist Society cannot simply
come into existence . It has to be built by people who
believe and practice its principles .
Socialism is the Christian way of life in action . It is the
philosophy that best gives expression to the Christian ideal
of equality of all God's children . It has as its foundation the
Christian belief that all men and women must love their
neighbors as themselves. (Manley, 1976 :158)
This good-intentioned but very vague and thus virtually
empty formulation is characteristic of the whole document . Little
or nothing is said about how this new society is to be achieved .
The closest it gets to specifying concrete measures to be taken in
the creation of socialism in Jamaica is to put forward the classic
social democratic formula of the `mixed economy' without really
specifying what the `mixture' will be between the private and the
public sectors . It speaks about the quest for equality, but at the
same time clings to the sanctity of private property . The question
of how this equality is to be achieved without seriously challenging
the profoundly unequal distribution of wealth and income based
on the inequalities in the possession of private property is not
addressed in this pamphlet . Moreover, the PNP states quite cat-
egorically and indeed in italics, `This Government rejects any form
of expropriation .'
The document also made it quite clear that capitalists have
a permanent place and role in the new democratic socialist
Jamaica . All that they needed to do in their quest for profits was
to be `responsible' and operate `within the bounds of the National
interest and the rights of the people,' a formulation, so vague that
it is rendered utterly meaningless . Foreign capital was promised
a warm welcome and was `assured a fair return on investment and
fair and consistent treatment,', provided that :
(a) the investment was in accordance with the `national
interest' ;
(b) the investor did not object if s/he was required to enter
into joint ventures with the state and/or Jamaican capital ;
and (c) s/he was willing to operate in Jamaica on a basis of
an un-defined conception of `good corporate citizenship .'
 JAMAICA 1972-1980

Some of the mysteries of `democratic socialism' are how- 151

ever, dispelled when we consider that Manley and his colleagues
in 1974 considered Britain, Sweden, Holland, Australia, New
Zealand, India, Zambia, and Tanzania to be countries under
`socialist governments' . Needless to say, not one of these countries
had or has broken with capitalist relations of production . Indeed,
what we have in this list is a motley collection of imperialist and de
facto third world dictatorships - with the qualified exception of
Tanzania .
When we look at the dynamic of public ownership under
the Manley regime we find that the actual nature of this whole
process differed quite markedly from the pronouncements of the
PNP : the little extension of public ownership which occurred
under the PNP government, followed the exigencies of political
and economic crises rather than conscious political intentions
informed by a radical programe . 51% of bauxite production and
all bauxite land have been bought by the state, but the crucial and
lucrative alumina processing sector, was and is, in reality un-
touched by the powers of the state . Consequently, when we
examine the ownership of the bauxite/alumina industry as a
whole, we find that the state owns a mere 8%! Secondly, the PNP
moved against the bauxite companies when the crisis within the
world economy and in Jamaica deepened and the need to control
to a greater extent the sector which accounts for over 70% of
export revenue became crucial .
Likewise the taking over of the operations of Barclays
Bank occurred after the bank decided to ends its operations in
Jamaica . This closure would certainly have created, had the state
not intervened, a great rupture within the financial structure of
the island . Again in the hotel industry, state ownership occured
after hotels were closed or their owners indicated that they had no
wish to continue operations in a depressed Jamaican tourist
industry . The partial state ownership of cement production
occurred, true to form, after Caribbean Cement attempted to
sabotage production by stating that it had not the resources to
carry out vital expansion to facilitate increased output . Here
again, then, nationalisation occurred after the state was presented
with an inescapable fait accompli - an offer it could not have
refused .
In effect then, the 'nationalisations' and move towards the
so-called `mixed economy' came about more by default, rather
than by conscious political desire and action guided by a radical
programme . In any event, despite the PNP's rhetoric about con-
trolling the commanding heights of the economy ; after eight
years and eight months `in power' the state controlled a meagre
18% of the economy, co-operatives 1%, and capital the remaining
 CAPITAL & CLASS

152 81% . Whereas the state owned 8% of the bauxite/alumina in-

dustry, private (completely foreign) capital owned and controlled
the remaining 92% of this vital industry ; likewise only 9% and 2%
of manufacturing and distribution respectively were state owned
at the close of the PNP regime . (PNP, 1980 :20 and National
Planning Agency, 1977)
But what is the objective basis of such an ideology within
the PNP? Why this simultaneous and contradictory quest for
equality and the defence of private property? To my mind, the
material basis and explanation is to be found in the fact that the
PNP has always been, and especially after 1952, as much a party of
the Jamaican bourgeoisie as that of the subaltern classes of
Jamaican society . Indeed historically the main financial support
of the PNP as mentioned above, has never come from its
impoverished working class base, but from members of the
Jamaican petit-bourgeoisie at home and abroad, and by 1953, the
haute bourgeoisie (members of the `twenty-one families') of
Jamaican society, and in particular the wealthy Matalon family .
(Munroe, 1972 :83-84) 2 As if this was not enough, the influence of
the Jamaican bourgeoisie on the policies of the PNP was not solely
confined to the fact that they held the purse strings and paid the
piper, they also had influential positions within the party itself .
The Minister of National Security in Manley's first Cabinet was
Eli Matalon, the former mayor of Kingston and member of the
Matalon family . This is the root of the remarkable tension within
the party between a plebeian base demanding equality, and the
bourgeois apex of the party defending the sanctity of private
property . `Democratic Socialism' is thus the legitimate, if feeble
offspring of this most unhappy and seemingly unlikely marriage .
In sum, then, it is clear that despite the rhetoric, all that is
to be found at the core of the PNP's ideology of democratic
socialism is the sanctity of capitalist relations of production and
nothing of the `fundamental change' which Manley had dema-
gogically promised, but which he himself in another context
disparagingly terms the `politics of tinkering .' (Manley, 1974 :23
and 34)
Democratic socialism in fact ends up, like a sermon, little
more than moral exhortation (a la `socialism is love', all God's
children are equal) within the boundaries of capitalist exploit-
ation . It as such manifests the classical traits of what Marx and
Engels term `conservative or bourgeois socialism' . And it was for
this reason that it was not at all surprising that even the Daily
Gleaner, the mouthpiece of the Jamaican ruling class since 1834,
did not scream `Murder!' but commented :
`There is no reason why the private sector of the nation
should not thrive as well or even better within the guidelines
 JAMAICA 1972-1980

of Socialism as under laissez faire Capitalism . Certainly, 153

business will be allowed fair profits and an adequate return
on capital investment . There does not seem anything frighten-
ing about the kind of Socialism the government is implementing.'
(Daily Gleaner, 24 Nov . 1974 ; emphasis added) .
To be sure the Gleaner (owned and scrupulously controlled
by perhaps the most powerful of the `twenty-one families', the
Ashenheims), was not long in changing its verdict on `democratic
socialism', but it is nonetheless significant that it held, and
moreover, divulged in such unequivocal terms its really quite
ungrudging acceptance of `democratic socialism' when it was first
announced .
We now need, however, to return to the central question
of why the bourgeoisie launched its prolonged but ultimately
successful offensive against the PNP . As I have indicated above,
the evidence suggests that factors of ideology and international
relations as opposed to the concrete measures taken by the PNP
domestically hold the key to answering this question .

There is no doubt that certain economic measures which were The Jamaican
taken by the PNP offended the bourgeoisie and thus aroused the Bourgeoisie
latter's opposition . Issues such as the dearth of foreign exchange and the PNP
currency, certain taxation measures, and the Minimum Wage
Law deeply worried the bourgeoisie . However, more often than
not the capitalist class managed to successfully bring their
enormous weight to bear upon the government, which either
resulted in the former being outrightly victorious, or a com-
promise was struck between the state personnel and the indigen-
ous bourgeoisie .
Indeed, the PNP took more concrete measures in aid of
capital in Jamaica than the JLP under Shearer, ever did . In 1971,
the last full year of the previous JLP government, subsidies to
industry stood at J$8 .535m ., however, by 1978 under the demo-
cratic socialist regime of Michael Manley, these subsidies to
industry increased by an astonishing 23 .6 fold to J$201 .9m .
(Dept . of Statistics, 1981 :52-53)' To be sure these figures are in
current values, but neither inflation nor devaluation can deny
this significant increase in state assistance to industry .
Incentives, such as tax holidays for certain industries,
were made more generous . The tax concession period for some
industries was extended from seven to ten years . In addition, the
tax-free period for companies operating under the incentive
legislation in the rural areas of the island was extended to fifteen
years .
The Kingston Export Free Zone offered such accom-
 CAPITAL & CLASS

154 modating incentives such as :

(a) 100% tax holiday on profits in perpetuity for all enter-
prises in the Zone ;
(b) Goods or raw material brought into the Zone will be
free from Customs Duty ;
(c) Minimal exchange control for foreign based operations ;
(d) Companies operating in the Free Zone will not be
subject to import licensing ;
(e) Foreign personnel employed in the Zone will not be
required to pay work permit taxes ;
(f) Freedom from quantitative restrictions ;
(g) No minimum investment is required ;
(h) The Free Zone legislation, by its structural and func-
tional aspects, does not restrict the repatriation of original invest-
ment plus any capital gain ;
and just in case the investor is still not persuaded :
(i) Around the clock security services are provided by the
Port Authority, including patrol dogs with handlers ; (Kingston
Export Free Zone, 1979 :16-18 andJamaica Chamber of Commerce
Journal Vol . 33, No . 1, 1977 :4-5) . Rather than being introduced
by Shearer and Seaga, staunch advocates of Puerto Rico's Luiz
Mutioz Marin's `operation bootstrap' recipe, these incentives
were promoted by the `democratic socialist' PNP. It must also be
borne in mind that this was not a political aberration deemed
necessary by force of circumstances, as the New Economic Policy
(NEP) under Lenin was : it was an integral element of the party's
strategy for development . Indeed, it should also be remembered
that the first PNP government (1955-1962) under the leadership
of Michael Manley's father, Norman Manley, adopted and
practised with religious zeal the `Puerto Rican Model' of
`industrialisation by invitation' . The 1972-80 PNP regime, then,
was in this respect merely following the well-trodden path of the
Party .
And what did the PNP government gain from this somewhat
absurd and veritable bending over backwards to accommodate
foreign capital? Well, in 1979 after over three years of operation
the Kingston Export Free Zone had twenty-four factories in
operation, but employed a mere 400 workers . In relation to the
incentives granted, these jobs must surely rank among the most
costly in the world in macro-economic terms . Many measures
were also taken to assist and encourage small businesses, including
the granting and guaranteeing of loans on extremely favourable
terms to those enterprises .
More significantly, in 1974 along with the bauxite levy also
came the Capital Development Fund, an institution through
which the funds from the transnational corporations (TNcs) could
 JAMAICA 1972-1980

be transferred to private industry ostensibly to diversify and 155

strengthen the island's economic base . (See Workers' Liberation
League, 1974 ; Maingot, 1979 and Reid, 1978) .
Finally, the state took on the role of guarantor on an
unprecedented scale of loans raised by private Jamaican capital
on the foreign capital markets . As a consequence of this by
October 1980 almost a third (J$597 .3m) of the total net external
debt (J$1,649m) was attributable to government guaranteed ex-
ternal loans . (Bank of Jamaica, 1981)
So, true to its ideology of democratic socialism the PNP did
not attack capitalism but instead supported it on a scale that the
Jamaican state had never done . In the light of the above, then,
what caused the bifurcation of the PNP regime and the local
bourgeoisie?
The evidence points to two factors : (a) the party's rhetoric
and (b) its new international relations, and especially those with
Cuba and other `progressive regimes .'
When one systematically peruses the major organ of the
Jamaican bourgeoisie, theJamaican Chamber of Commerce journal
we find that the major issue of concern was not so much the
government's economic and social policies, but the rhetoric of
the party which made the bourgeois class not so much fear the
present, as view the future with great trepidation .
This explicit disquiet of the Jamaican bourgeoisie goes as
far back as 1973 and was to become more audible and vociferous
as time went on . In Feburuary 1975 the then President of the
Jamaican Chamber of Commerce, Mr . Winston Weeks, said :
"It is no secret to most if not all of us that there are forces in
the society conspiring to remove the terminology "Private
Enterprise" from the vocabulary of Jamaicans in as short a
time as possible . It is no secret that these are crucial times
for us, for Jamaica and for the stability of all that is
important in our Nation . Regardless of the platitudes that
have been mouthed and the oratorical outbursts shouted
from platforms in recent times to gloss over the sugar
coated pill that is being pushed down the throats of many,
few of us are fooled as to what could result from a relaxation
of vigilance and should not allow ourselves to be lulled into
a feeling of false security in the face of this monster problem .
Near and far, far and wide, socialism is being preached in
the land . After many an attempt to clothe this macabre
being in as many dresses as there have been addresses by
spokesmen for the Government, at long last it has been
suitably attired as far as the protagonists are concerned in
the robes of Democratic Socialism ."
From the general tenor of Mr Week's speech it is evident
 CAPITAL & CLASS

156 that he was disturbed by the ideology of the PNP, not so much for
what it entailed at that particular point in time, but for what it
implicitly and potentially holds for the future . As Weeks said : "We
see the writing of the future vaguely on the wall. Do we want it
clearly spelt out for us?" It was in the same vein that Edward
Seaga in a speech to the Kingston Jaycees declared : "the real
socialism is yet to come ."
The Jamaican bourgeoisie's attitude to the closer relations
with Cuba established by the Manley regime is well known . The
more intimate Cuba/Jamaica relations were from the very begin-
ning received with universal condemnation by the Jamaican
Establishment . This "anti-communist" hysteria finally reached a
crescendo with the abrupt severing of diplomatic relations with
Cuba by the new Seaga regime .
But why did the Jamaican bourgeoisie find the rhetoric of
the Manley regime so frightening? After all, the bark of demo-
cratic socialism was infinitely worse than its bite, so why the
panic? There seem to be two reasons . Firstly, as we have already
indicated, the rhetoric created uncertainty and capitalist
planning cannot take place effectively in conditions of
uncertainty and instability . This was especially worrying for the
Jamaican bourgeoisie because they saw Manley, in particular, as
being extremely mercurial politically . According to them, one
could never be quite sure of what Manley was going to do next .
Indeed the causal relation between the populist rhetoric and the
capitalist panic and stampede has been acknowledged by sources
as diverse in political perspectives as the World Bank and
Michael Manley himself.'
The second major worry about the populist rhetoric for the
Jamaican bourgeoisie was the radicalising effect it had on the
already volatile Jamaican masses, and especially the urban youth
and workers . Indeed, the PNP was accused of "stirring up" the
workers and "raising expectations ." It is certainly true that the
ideology of "democratic socialism" raised the confidence of the
Jamaican masses and their combativity : it is no accident that soon
after the declaration of "democratic socialism" in 1974 several
large estates in Western and Eastern Jamaica were "captured" by
landless peasants and agro-proletarians under the slogan, "it is
socialism time now" .
Before we go on to consider the relation between the
external bourgeoisie (basically, American capital) and the PNP
regime, it is worth registering at this point that the dynamic of
the PNP government unleashed a tragic and viciously destructive
cycle . First of all came the declaration of `democratic socialism'
and the attendant disproportionately fiery rhetoric ; this in its
turn led to a decline in the levels of investment (foreign as well as
 JAMAICA 1972-1980

domestic) and flight of capital .' As a consequence of the tremen- 157

dous hardship inflicted upon the poor by this veritable strike and
sabotage undertaken by the bourgeoisie, the PNP condemned
(verbally) the culprits as the `unpatriotic oligarchy and clique' .
(Manley) . 6 This rhetoric in its turn instead of stemming the flight
of capital, exacerbated it . Because of the dramatic fall in pro-
duction, exports and foreign exchange, the government finally
turned to the IMF . The IMF medicine did not work, indeed the
economic and social conditions worsened and the standard of
living of the working class and oppressed plummeted : instead of
curing the patient the IMF medicine, rather like the prescription
of a quack all but killed it . The base of the party became restless ;
violent demonstrations (detonated by the increase in the price of
gasoline) occurred in early 1979 . The PNP pressurised by the JLP
opposition, the masses and the trade unions, blamed the IMF for
the harshness of the conditions imposed and the non-
materialisation of anticipated results even when the IMF guide-
lines were obediently and rigorously adhered to . The IMF re-
sponded in equally belligerent terms making its measures even
tougher and described Jamaica as an ungrateful `spoilt child' .'
The bourgeoisie in the meantime took to the warpath and height-
ened its offensive against the government . While the economy
haemorrhaged, the poor suffered from malnutrition ; the PNP
regime in its turn provided a generous dose of the only thing it
had in quantity, demagogy . Although Manley intimated that he
would take over the factories if the owners did not intend to
produce,' in the event, the PNP did not . Because of the sanctity of
private property to the Party, no expropriation took place, and
even where nationalisation did take place, it was done under close
observation of `the principle of reasonable compensation' . But
there is a major problem if the coffers of the state are empty .
There can be no nationalisation ; factories and productive units
which have been closed are then left idle ; the economy enters
reverse gear ; there is no production but there is also no expropri-
ation ; the result? A state of catastrophic impasse .
The PNP did the only thing that was left open to it to do :
call a general election . The party had reached the objective limits
of all possible reforms in Jamaica - to have gone on further it
would have had to `violate' the rights of private property and this
it is congenitally unable to do . Regis Debray is therefore right in
his assessment of reformist parties : the problem with them is not
that they are reformist per se, it is that they are not reformist
enough . The extent of the reforms they are willing to undertake
are rather limited ; moreover, they are oblivious to the fact that to
sustain the momentum of reform a'revolutionary leap forward' is
necessary :
 CAPITAL & CLASS

158 `It is not applying reforms instead of "making the revo-

lution" that makes a man reformist . You are a reformist if
you imagine that reforms can take place without eventually
leading to a revolutionary situation ; if you think that the
same methods which make it possible to introduce reforms
will make it possible to resolve a situation of revolutionary
crisis - when what is at stake is not just modifying a
particular article of the constitution or deciding which
firms are to be nationalised, but the life or death, the defeat
or victory of one side or the other .' (Debray, 1977 :284) .

The external W e have still to consider the question of why foreign capital, and
Bourgeoisie American imperialism in particular, pulled out all the stops
and the PNP against the Manley regime . In this context the role of the bauxite
levy and nationalisation, though certainly important, have
largely been over-emphasized in analyses of the Manley regime .
There is a major difference, which has often been ignored,
between the importance of bauxite to the Jamaican economy and
the importance of the latter to the us economy and thus the
impact of the bauxite levy and nationalisation on the fortunes of
the us economy .
The bauxite production levy and measures to `nationalise'
the bauxite industry did not come about because of any intrinsic
radical thrust within the PNP, but were brought into being by the
exigencies of what James O'Connor terms a `fiscal crisis of the
state' .' In addition, it followed from the rupture created within
the economy by the steep increase in the price of manufactures
and food imported from the advanced capitalist countries, taken
together with the OPEC oil price increases which followed the
Arab-Israeli War of late 1973 .
The Bauxite Production Levy Act came into being in late
1974 after ten fruitless weeks of negotiations between a team led
by eminent members of the Jamaican bourgeoisie (Matalon,
Ashenheim, Rousseau) and the bauxite companies . It increased
the rate of taxation per ton of bauxite produced by 480%, from
J$2 .50 to J$14 .51 . This of course in relative terms is a massive rise
in the rate, but in absolute terms it was far less significant . As a
consequence of the increased rate, the state revenue from the
bauxite/alumina enclave increased 650% between 1972 and 1974
from J$22 .71m to J$170 .34m respectively .
However, when we examine the real material impact of the
levy on the us economy on the firms involved, and indeed, ask
the important question, could the bauxite levy be sustained, we
get a very different, but more realistic picture . While the OPEC
price increases detonated a massive rupture within the us
 JAMAICA 1972-1980

economy by increasing its oil import bill by us$32 billion in 1973 159
alone, the combined price increases of the International Bauxite
Association (IBA) 10 increased expenditure on bauxite importation
by a mere us$300 million . The Joint Senate Committee on
Commerce and Government Operations of the us heard that the
Jamaican levy would amount to an 8% increase in the price of
aluminium, while the price of bauxite itself would be increased
by three cents per pound . At the time, the price of bauxite was
US25 .33 cents per pound . The three cents increase in the price of
bauxite, then in percentage terms was a relatively small 11 .8%
(US Congress, 1974 :75) . Moreover, because of their monopoly
position the companies could and indeed explicitly stated that
they would merely pass the increases on to the consumer . (us
Congress, 1974 :13) .
When we examine the prospects of sustaining the bauxite
levy and the IBA, we get a very bleak picture which really makes
one wonder if Girvan and his colleagues at the National Planning
Agency and the Jamaica Bauxite Institute could have really
expected the levy to stick and the IBA to survive as a serious and
viable cartel .
To start with, aluminium is the most common metal in the
world . It has been estimated that 8% of the earth's crust is made
up of the substance . This is more than that of all other metals
combined . The us Bureau of Mines estimates of proven world
reserves of bauxite in 1973 was of the order of 15 .5 billion tons - a
quantity sufficient to supply all the world's smelters for more
than 230 years at the 1974 rate of consumption . Australia's known
reserves alone could supply the entire world's aluminium smelters
for more than 70 years at the 1974 rate of use (us Senate,
1974:290) Jamaica at the time, accounting for only 6 .5% was not
in an especially privileged position in the ranking of world
reserves .
This wide spread of the world's bauxite resources ham-
pered the objective potential of the IBA . The members (Australia,
The Dominican Republic, Guinea, Guyana, Haiti, Jamaica,
Sierra Leone and Surinam) were far too disparate in their political
outlook and degree of dependence upon their respective bauxite
industries to have put up a united front against the more cohesive
companies ." Guinea for instance, pursued obsequious policies in
relation to the transnational corporations," while the presence of
Australia among the members of the IBA was always somewhat
incongruous . Here was a member of the OECD countries, possess-
ing the largest reserves of bauxite among a group of poor third
world countries . Australia had always lent a sympathetic ear to its
advanced capitalist partners, including the USA, and more
disturbingly, Australia's dependence upon bauxite for foreign
 CAPITAL & CLASS

160 exchange and general economic well-being had always been, in

relation to the other IBA partners, very slight . While Jamaica, for
instance, depends upon bauxite/alumina exports for over 70% of
its export earnings, Australia (although the world's leading pro-
ducer of bauxite and alumina) only earns 4% of its foreign
exchange from the bauxite industry, and to top it all bauxite is
merely one of a staggering total of forty-six minerals produced on
that rich continent . (Latin American Regional Reports : The
Caribbean, Oct . 31, 1980) .
It was therefore clear to the companies that the bauxite
levy could not be sustained : the latter could make an impact
(albeit a small one in absolute terms) but it would be short-lived .
Small wonder then that James Burrows, an expert on minerals
and investment policies (and indeed one of the most astute
among those who testified before the us Senate Sub-Committee)
rightly noted that although Jamaica and the other Caribbean
countries possessed a certain degree of leverage as a consequence
of the level of investment in these countries, the prospects,
nevertheless for the IBA were not very good . Indeed, the con-
straints on the IBA were so great that government to government
negotiations were unnecessary, all that was required, he declared,
was for the companies to `chip away at the cartel ." 3 And this was
precisely what they did . Jamaica's bauxite and alumina produc-
tion were drastically cut back : bauxite production in 1976 was
32 .1% less than it was in 1974, the year the levy was first intro-
duced ; alumina production fell even more catastrophically - by
no less than 48 .8% between 1974 and 1976 . (Dept. of Statistics,
1979 :30) What is important to note here is that this massive
reduction in production was the end result of a deliberate and
systematic switch of the transnational to other, more accom-
modating sources of bauxite . At a time when Jamaica's bauxite
production was falling away world production expanded from
71 .8m tons in 1973 to 74 .8m tons in 1976 . A sharp re-arrangement
of the world production league occurred with Guinea jumping
from 3 .9% in 1973 to 15 .37% of world production in 1976 . What
is even more dramatic is the way in which the us switched its
market for bauxite importation . Again the case of Guinea is very
telling . In 1970 Guinea accounted for only 3 .9% of us bauxite
imports, while Jamaica accounted for 56 .2% . By 1976, however,
things had changed significantly : Guinea took up 23 .9% of the us
market, while Jamaica's share declined to 49 .0% . When we note
the change in the share of the us market taken up by Jamaica and
Guinea over the seven year period (1970 to 1976), the significance
of the transformation is brought into full relief : Jamaica's share of
the us market falling from 56 .2% to 49 .0% over the period
amounts to a relative decline of 13%, while Guinea's increase
 JAMAICA 1972-1980

from 3 .9% to 23 .9% indicates a phenomenal increase of no less 161

than 513%!
It was because of such a classic divide and rule strategy that
an exasperated Dr . Carlton Davis, the Director of the Jamaica
Bauxite Institute (JBi) described the IBA as a mere `talking shop .'
(LA Regional Reports : The Caribbean, 31/10/80 ; South, 15 Jan-
Feb, 1981 :71) . The state coffers (already under the strains of a
severe fiscal crisis) felt the full impact of the sabotage of the
transnational corporations - state revenue from the bauxite/
alumina industry declined between 1974 and 1976 by no less than
30 .46% . Thus by July 1979, a battle weary PNP regime finally
succumbed to the heavy artillery of the transnational corporations
by (among other concessions), reducing the rate of the levy from
7 .5% of the averaged realised price of primary aluminium in the
us to a figure of about 6 .5% . This in effect amounted to a
reduction in the levy rate by 13 .3% ."
Finally, it is important to note that the TNCS have
successfully managed to foil all attempts to nationalise them, and
especially their more lucrative alumina processing sectors .
Despite the great populist fanfare about taking control of the
`commanding heights' of the economy and state acquisition of
the bauxite/alumina industry, in 1979 the Jamaican state, as was
mentioned above, controlled a mere 8% of the industry . There
has certainly been some degree of state re-acquisition of bauxite
mining and land held by the companies ; but the Jamaican state,
`democratic socialist' or not, has not really challenged the
hegemony of the giants in the alumina refining sector .
So having considered the fairly mild material impact of the
measures on the us economy and companies concerned, the
question then arises, what created such a major outcry by the
companies and what engendered such a murderous response?
To my mind, the answer to this question is that it was felt
that Jamaica had to be taught a lesson for demonstrative and
pedagogical purposes . This was because it was thought that (a)
the PNP had set a bad and unacceptable precedent, and (b) by
attempting to establish an international cartel (the IBA) which
could, had it been established solidly, have created a great
deal of uncertainty in the operations of these companies in the
future . The concerted counter-offensive of the bauxite
companies against the levy was generated more by what it was
conceived to represent rather than what it amounted to in dollars
and cents . As everyone knows, one of the factors cherished most
by these companies (as it is by every capitalist enterprise) is long
term stability . The bauxite levy disrupted this cherished dream
of capitalism in Jamaica and in addition sent out a lot of ripples to
other producer countries which culminated in the formation of

C a C 19 - K
 CAPITAL & CLASS

162 the IBA . This, for the TNCS, did not augur well for the future .
Jamaica had to be taught a lesson, and in the event it was . Charles
Parry of The Aluminium Company of America (ALCOA), put the
position of the TNCS clearly :
`Unilateral action by foreign governments violating con-
tracts for vital resources has serious disruptive conse-
quences for the us economy and for world trade .
Companies and financial institutions that provide funds
for industrial development base their decision on such
contracts . If experience shows that contracts can be cast
aside at the will of the host country, these institutions can
no longer be expected to support foreign industrial dev-
elopment . The continued absence of strong United States
Government reaction to such moves, of course, results in
additional pressure on governments in other countries
supplying raw materials to take similar action . This goes
far beyond bauxite : it will extend to all types of raw
materials . (Parry, 1974 :7)
And more specifically, he told a member of the Senate Sub-
committee : `Jamaica is just the first, Senator, there are going to
be others if they can get away with it .'
The offensives launched by the CIA and the State Depart-
ment were for geo-political rather than for directly economic
reasons . It was not the bauxite offensive which elicited their
wrath but the fact that, as their logic went : here was Jamaica, a
country in the US's `backyard' and astride essential foreign trade
routes,' 5 courting Cuba the little bete noire of American imperial-
ism, making noises about apartheid and shouting loud and clear
in dissatisfaction about the present international economic order
at the UN and other international forums, declaring `democratic
socialism' at home and supporting the MPLA in Angola . In the
eyes of Washington, Jamaica under Manley was on the road to
becoming `another Cuba' . This could not be allowed to occur,
not so much for directly economic reasons, as for geo-political
ones : Jamaica was in the eyes of Washington, one of the floating
battleships of the Caribbean sea which was threatening to lower
the Stars and Stripes and hoist the flag of the Hammer and
Sickle . When Henry Kissinger took a vacation-with 70 advisors!
- in Jamaica late in 1975 he did not raise the question of the
Bauxite levy . Instead, he demanded an end to the support of the
MPLA assisted by the Cubans in Angola. 16 Manley could not (and
for various political reasons which we cannot explore here) did
not oblige . Indeed, it is very ironic that Kissinger's visit to
Jamaica coincided with that of a three-person MPLA delegation
invited by the Manley government . Unlike Kissinger, the
Angolans were very warmly received by the Jamaican masses,
 JAMAICA 1972-1980

especially the urban Rastafarian youth . 163

Again in marked contrast to the MPLA delegation, Kissinger
returned home empty-handed and disappointed ." Soon after-
wards, Washington was to unleash its whole arsenal (short only of
overt military intervention, Dominican-style) on the Manley
regime . In the ensuing months, hundreds of Jamaicans were
killed in the run-up to the December 1976 General Elections .
Philip Agee, a former CIA agent, went to the island, identified and
disseminated detailed information on eleven CIA agents operating
from the us embassy in Kingston . In addition he informed the
Jamaican people at public meetings of the murderous activities of
the CIA world-wide . Also in 1976 a plan by an extreme right wing
group to wreak havoc in Jamaica (code named Operation
Werewolf) was foiled by security forces, who discovered detailed
plans, arms, and ammunition that were to be used in an attempt
to oust Manley . In response to the right wing offensive, the
Jamaican workers, peasants and unemployed (despite the
massive defection of the Jamaican middle class to the right - the
usual reaction of this class when the class struggle heightens) as
the table below shows, returned Manley in the December 1976
elections with an even greater mandate to continue his
programme of reforms .
Class Alignments Supporting the PNP

PNP Vote PNP vote PNP vote

1972 1976 1980
Unemployed & Unskilled 52% 60% 40%
Manual Wage Labour 61% 72% 48%
White Collar Wage Labour 75% 57% 37%
Business and Management Class & High
Income Professionals 60% 20% 14%
Farm Labour 52% 56% 42%
Small Peasants 47% 45% 35%
Source: Stone (1981 : 40)

In the USA in the meantime, a Democratic president in the

form of Jimmy Carter came into power and in marked contrast to
the Nixon-Kissinger and Ford-Kissinger administrations was
more accommodating to the Manley regime . Funds from the us
government agencies such as the us Agency for International
Development (USAID) began to flow once again in accordance
with the diagnosis that the Caribbean was a `tinder box ready to
explode' that needed Aid instead of clobbering . 1 e However, with
the coming of the intervention of the Soviet Union in Afghanistan,
a new Cold War epoch was opened and a chill wind swept
through the Caribbean . The spotlights were once again turned on
to Cuba and on those who befriended it. Manley therefore came
under increasing scrutiny by the US state . The shift in the balance
 CAPITAL & CLASS

164 of forces within the Carter administration from the relatively

liberal Cyrus Vance (who later resigned over the abortive attempt
to rescue the American hostages in Iran) and his supporters, to
the hardline position of Brzezinski along with the ousting of
Andrew Young, facilitated the `putsch' against the PNP regime .
Manley's speech at the Summit Meeting of the Non-Aligned
nations in Havana, attacked nearly everything the us stands for
and defends - the question of Cuba, Puerto Rico, Southern
Africa, Nicaragua, Vietnam and Kampuchea, the Polisaro
guerillas, Palestine, the New International Economic Order, and
so on . The right in the us jumped on this, in the `I told you so'
fashion convinced that Manley's pronouncements proved defini-
tively that he was a `Communist' . Cyrus Vance expressed his fury
to the Deputy Prime Minister, and Minister of External Affairs,
PJ Patterson while the latter was on a visit to Washington .
As in 1976, so again in the months preceding the 1980
elections, the whole battery of us and imperialist `non-military'
weapons were unleashed against the Manley regime : the CIA
support for right wing oppositionists in Jamaica ; press campaigns
not only in Jamaica itself, but also in the us and Canada 19 and
indeed other Western countries such as Britain where the right-
wing Daily Telegraph was most virulent against Manley-, the
credit squeeze placed on Jamaica by the financial institutions,
both the so-called multilateral ones such as the IMF and the

0
0
 JAMAICA 1972-1980

World Bank, and the commercial banks in Europe and North 165
America, which were literally just waiting for the Manley regime
to tumble and thus resume their lucrative, if somewhat pre-
carious, business with Seaga .
Unlike 1976, however, in 1980 the forces of reaction suc-
ceeded in unseating Manley . It is important to note though that
the PNP regime was not ousted by a military coup (although a plan
for one was uncovered and thus foiled) but by a popular vote,
albeit one accompanied by an unprecedented and remarkably
high level of violence .

We therefore need to establish the causes behind the switching of Workers,

allegiance in the October 1980 elections from the PNP (and at least peasants,
by default) to the JLP . This task is especially important because the unemployed
the PNP owed its 1976 electoral victory to the overwhelming and the
support of the Jamaican working class and oppressed . PNP regime
Now the evidence suggests that there was an unparalleled
improvement in the standard of living of the working class in at
least the first four years of PNP rule . Apart from a greatly increased
social wage, for instance, free school uniforms for primary school
children (1973), free secondary and university education (1973),
there was also significant (but fluctuating) increases in real wages
until 1977, which was, significantly, the year the first IMF agree-
ment was signed . It is worth noting here that it was no accident
that the fall in the standard of living coincided with the IMF
intervention . Although Manley and his colleagues attempted
(but conspicuously failed) to implement a series of wage restraints
(from 1975 onwards), well before the IMF came into the picture,
the real turning point occurred when the massive devaluations in
the Jamaican dollar were demanded by the IMF as a condition of
assistance . Despite strong opposition in Jamaica, including some
from inside Manley's party itself, devaluation was conceded by
the PNP . The increased prices of imported goods including basic
items such as food added fuel to a major inflationary spiral which
eroded the gains won by the working class in the preceding years .
One of the major and most urgent tasks which the PNP had
set itself on coming to power in February 1972, was the reduction
of the chronically high levels of unemployment, which the pre-
vious year was running at an estimated 25% of the labour force . A
crash programme of job-creation (the Impact Employment Pro-
gramme) was introduced in 1972 which involved the provision of
work for the unemployed by means of street cleaning and other
work for the municipal authorities, especially in Kingston . By
the end of 1972 this provided employment for 31,888 persons
(excluding another 1,000 people who were taken on by private
 CAPITAL & CLASS

166 industry which initially worked with the scheme) . Along with
general stimulation of the economy through greater government
expenditure, this helped reduce unemployment so that by April
1973 the proportion of the labour force out of work had fallen to
21 .4% ; but the level of unemployment was not to fall below the
April 1975 level of 19 .9% . Indeed, by October 1979, partly due to
the floods earlier in the year, it had reached 31 .1% and despite
various efforts to reduce this level in order to gain popular
support in the election year, it had fallen to only 26 .8% by
November 1980 . In fact, bad though these aggregates are in
themselves, they disguise the very high levels of under-
employment, youth unemployment and the astonishingly high
rate of female unemployment which on average amounts to
almost twice the national level . The underlying cause in the
marked deterioration of the unemployment situation towards the
end of the government was the flight of capital and the investment
strike which the capitalist class unleashed against the PNP regime
after 1975, and, after 1977, the austerity measures introduced by
the government under the aegis of the IMF .
Despite the concessions made by the PNP to the exploited
and oppressed of Jamaican society (especially in the early years of
the regime), there were however, also major attempts to slow
down the march of these classes and in particular, that of the
organised working class . Thus, in 1975, the Labour Relations
and Industrial Disputes Act came into force . The unions, during
the formative stages of the bill, managed to win concessions from
the regime including redundancy payments, compulsory union
recognition by employers, etc . However, in spite of the strong
resistance put up by the unions and from within the PNP itself,
the Act made strikes illegal in certain industries and sectors of the
economy defined as `essential' . Significantly, this Act was
strikingly similar to Edward Heath's notorious Act of the same
name . (Hart, 1974, Cf. Kirkaldy, 1979) 20 And like Heath's Act,
Manley's became a dead letter, since the unions ignored it and
continued to struggle at the workplace in defence of their rights
and standard of living . Again in 1975, the PNP in an attempt to
appease the bourgeoisie, also introduced measures aimed at re-
straining wage increases . Contrary to popular mythology about
the PNP, the IMF did not introduce wage limits in Jamaica, the
latter merely recharged and streamlined the `social contract'
when it arrived in 1977 .
Following an IMF demand, the list of basic items under
price controls was reduced from nearly 100 to 40 between 1977
and 1979 . This combined with the devaluation of the Jamaican
dollar, caused prices to shoot through the roof as capitalists
ruthlessly but not surprisingly attempted to maintain their profit
 JAMAICA 1972-1980

margins . The official annual rate of inflation thus increased from 167
8 .1 % in the year 1975/76 to 49 .4% in the year 1977/78 . And in the
latter year, the price of food and drink alone, had increased by no
less than 54 .1% . In a period of spiralling inflation, the workers
understandably resisted the wage restraint vigorously . And so
from a figure of 551 industrial disputes in 1975, there was an
increase to 687 in 1978 and 609 in 1979 . In the latter year, the
number of work stoppages reported was 182, which resulted in
the loss of 82,093 work-days .
Instead of seriously dealing with the root cause of poverty
and inequality in Jamaica, namely dependent capitalism, Manley
and his colleagues endeavoured to deal repressively with its
symptoms . Thus, in accordance with its promise to the Jamaican
electorate in 1972 to `destroy the gun', the PNP introduced a
whole plethora of repressive measures, proudly but accurately
dubbed `heavy manners' . Among these pride of place was given
to the Gun Court where (despite strong opposition from the legal
profession and other quarters in Jamaica), persons convicted of
the illegal possession of firearms would be kept in detention
indefinitely . This was later changed to mandatory life imprison-
ment . To this day the Gun Court is still in operation . Indeed the
story takes on a somewhat macabre and ironic twist because
Seaga on coming to power tried to use the Gun Court Act to
obtain the head of the bogey man of the Jamaican bourgeoisie,
the PNP's radical General Secretary, Dr . DK Duncan, by means Peter Tosh at the
of what seems to be a clumsy and desperate frame-up . peaceralley
It should be noted here that the first serious attempt to bring
an end to party-political gang warfare in the ghettoes, the Peace
Movement, which was initiated in 1978 by the lumpen youths
and poor people in the slums of Kingston themselves, was brutally
sabotaged . Nine months after the famous Peace Concert of April
1978, one of the main parties to the agreement, Claudie Massop
of the JLP was killed by a hail of bullets as police ambushed and
opened fire on the taxi in which he was travelling ." Soon after-
wards his PNP counterpart to the agreement of 1978, Bucky
Marshall, was gunned down in cold blood in a New York night-
club . Also in late 1978, Peter Tosh, the well-known Jamaican
reggae artiste (and perhaps the most radical and outspoken of the
Jamaican musicians) who at the Peace Concert attacked quite
vigorously the politicans and the brutality meted out daily by the
police to the youths of the ghettoes, was himself brutally beaten
up by the police on the pretext that he was seen smoking a
marijuana `joint' . (Tosh, 1978)
The motive and forces behind the destruction of the Peace
Movement are far from clear . There have been, however, plaus-
ible allegations to the effect that the politicans of both parties 47.
 CAPITAL & CLASS

168 finding that they could not make good the demands of the united
people of the ghetto decided to revert to the classic divide-and-
rule strategy which had served them well in the past . Therefore,
so the argument goes, once one or both of the signatories to the
Peace Treaty was eliminated the whole peace process would be
destroyed and the people of the ghetto would once again turn in
upon themselves and continue the `tribal war' over the crumbs
which the politicans and the ruling class care to throw their way .
In fact, this is precisely what occurred after the police had
murdered Massop : the situation in the ghetto quickly reverted to
a state of fratricide .
The unequal distribution of land in Jamaica has already
been mentioned . The best index of the barbarity of agrarian
relations in Jamaica are the following statistics which are to be
found in the most recent Census of Agriculture (1968/9) : In
1968/69, a mere 293 farms of 500 acres or more in size, occupied
44 .85% of the island's agricultural land, while 151,705 farms
under 5 acres in size occupied a mere 14 .84% of the land . And
with about 60% of the island's population still living in the
countryside, the average income for each employed person in
agriculture was as low as one-third of the national average between
1960 and 1972 . (Robotham, 1977 :45) In addition the workers
and peasants in the countryside suffer the brunt of the economic
backwardness of the country as a whole : illiteracy, malnutrition,
and as the statistics show, land-hunger .
After a spate of land occupations in the 1960s, the PNP
came to office in 1972 with a massive mandate for the transfor-
mation of the rural economic relations in Jamaica . Manley recog-
nised the importance of the task . Within two days of coming into
office he had promised to `get to the heart of the farmers' prob-
lems . . . Jamaica's future will make or break on how quickly we
get down to the heart of the agricultural problem, effect recon-
struction and get this vital area moving .' Daily Gleaner, 4/3/72 ;
Manley, 1974 : 96-100, 205-206) But as we shall see presently, the
PNP merely tinkered with rural relations in Jamaica . Moreover, it
is indeed arguable that the major beneficiaries of the land reform
programme were the landowners who sold or leased poor quality
land to the state at extortionate rates.
The strategy of the PNP was to buy or lease (never to
expropriate) idle land from the owners of large estates of over 50
acres in area . The PNP did not succeed in acquiring arable and
irrigated land . It is by now a well established fact that the areas in
which the bulk of the tenant farmers were placed were also (by no
coincidence) the most infertile and barren parishes of the island .
Where owners did not want to comply with the government's
wishes, they merely presented it with the most palpably bogus
 JAMAICA 1972-1980

`development plans' which the government accepted without 169

challenge . (Harriot, 1979 ; Grant, 1977 :61)
From an unofficially estimated area of 500,000 acres of idle
land, the PNP at December 1979 had investigated a total of 2,434
properties with gross acreage of 184,679 ; of which 483 with an
arable area of 67,546 had been leased to some 36,467 farmers .
(NPA, 1980 : 7 .3-7 .4) . The average arable area per farmer, then,
was a mere 1 .8 acres . This certainly did not herald the change of
relations in the Jamaican countryside . 22
To make matters worse, the programme was inefficiently
organised, incompetently executed, and riddled with nepotism
and clientelism . These factors have often been noted by both left
and right wing critics of Manley's agrarian reform in practice .
Less frequently mentioned is the fact that more technical and
material resources (including land itself) were needed if the
programme was to have had a serious chance of succeeding .
Apart from the fact that the amount of land distributed was
grossly inadequate in area, the farmers were not provided with
enough tools, fertilisers" and indeed stronger protection from
the serious problem of predial larceny ie . crops on the land being
stolen .
Thus as a consequence of the combined effect of ineffi-
ciency, corruption and lack of equipment, the various schemes
failed despite their limited nature . The Food Farms before expir-
ing due to lack of results expended $3 for every $1 of food
produced . (Stone 1981 : 125) The Pioneer Farms (worked by
unemployed youths between the ages of 18 and 25 years) were in
the end virtually left unattended . The initial figure of 363 persons
quickly declined to 198 having put only 116 acres into production
from an area of 1,417 acres of arable land available on the 11
farms . By December 1979 only 9 farms were left in operation,
with a total of a mere 132 farmers . (Stone 1981 :126, NPA 1980 :7 .3)
By this time, the farm credit schemes were also in a state of
disintegration . The number of farmers under the Crop Lien
Loan Programme declined by 81% for the year ending March
1979 with the number of participating farmers falling from 30,328
in 1977/78 to 5,855 in 1978/79 . Likewise, the acreage under the
scheme over the same period, fell from 27,946 to 6,579 . From a
collection target of $10m . for the year 1978/79, only $409,056
was realised . Since the scheme commenced in 1977, nearly
$13 .5m had been pumped into it, but less than $1 .9m had been
recovered (Daily Gleaner : 8/9/79) . This gross discrepancy be-
tween loans and anticipated repayments should not be interpreted
as indicating inherent criminality among Jamaica's peasants, but
instead should be seen to be an indication of the poverty of small
farmers . The evidence suggests that they simply could not repay
 CAPITAL & CLASS

170 these loans ."

To make matters worse agricultural production per capita,
either stagnated or declined . Thus between 1972 and 1977,
domestic agricultural production after declining, reached J$39 .00
per capita from a figure of J$37 .00 . Export agriculture declined
by a third over the same period from J$21 .00 to J$14.00 per
capita . Agricultural production per capita in toto fell from J$88 .00
per year in 1972 to J$84 .00 in 1977 . At the same time importation
of food went on unabated . In 1973, Jamaica's food import bill
was J$84m ; by 1978 it had jumped to J$234 .5m, and in 1979 it
declined somewhat (but not because of increased domestic pro-
duction, but because of the foreign exchange crisis and the fall in
the real consumption of food) to J$226 .9m .
The cosmetic effect of the so-called land reform programme
of the PNP is brought into full relief when we compare the total
amount of farmers placed, with the number of people un-
employed . In 1979, after six years of land reform, whilst (by the
most generous of calculations) the number of farmers engaged by
Project Land Lease and other agrarian reform programmes was
44,775 ; the number of people unemployed in October 1979 was
264,700 . (NPA, 1980 : chap . 7 and Table 16 .1) In other words, the
number of those unemployed in October 1979 was almost six
times the number of people engaged in the `democratic socialist'
land reform programme .
To summarise the performance of the PNP vis-a-vis the
working class, peasants and the unemployed, it is evident that in
the first few years of the regime the real standard of living (as
measured by real median weekly income) increased quite
dramatically . However by 1977 the tide had turned : by 1979
unemployment had reached 31 .1% ; and in 1980 real incomes
were below the levels they were in 1974 . The consumption of
food, non-alcoholic beverages, clothing and footwear in 1980 was
down quite significantly in relation to the 1974 levels . The land
reform programme was totally cosmetic and did not alter the
relations of forces in the Jamaican countryside .
In short the PNP had run out of steam and had very little to
offer . It would have indeed been a miracle or a massive political
fraud had the PNP won the 1980 elections - just as it would have
been such had the JLP won in February 1972 when the PNP first
came to power. There is no sense in saying that the people voted
for Seaga because of the violence and the bullying of the JLP as
some maintain . There is no doubt that the violence contributed
to the vote against Manley, but to make this single factor the
fulcrum of any explanation of the fall of the PNP is, to my mind to
avoid the crucial issues and to dodge the difficult questions . It is
true to say that gunmen and indeed security forces were `out of
 JAMAICA 1972-1980

control' (Manley) and that officially 856 people were shot dead in 171
the political mayhem . But in 1976, the same scenario unfolded
(although the violence did not reach the horrendous and un-
paralleled pitch of 1980), nevertheless the workers, peasants and
unemployed of Jamaica went out in unprecedented numbers to
vote for Manley and the PNP. In 1980 they did not repeat their
actions because the Manley regime in their eyes had failed to
deliver, and `mashed up' Jamaica . 25 It mashed up Jamaica because
in a most utopian and adventurist manner it attacked imperialist
interests and did not expect a retaliation and most certainly was
not prepared to deal with one when it predictably and almost
inevitably materialised . The PNP regime, true to the stipulations
of the Jamaican constitution on the rights and safeguards of
private property literally inscribed in the latter by the Jamaican
bourgeoisie (at the behest of its imperialist senior partners) did
not expropriate nor sanction the expropriation of one single
capitalist enterprise, thus enabling the production of at least
certain basic goods to be continued . Like Goethe's sorcerer's
apprentice, the PNP under Manley unleashed processes that it
could not, and was not prepared to control .
Now it is the height of political irresponsibility if a regime
does not allow, or create conditions condusive to the continued
operation of the capitalist mode of production and simultaneously,
does not attack capitalist relations of production so that the goods
and services needed by that society can be continued to be
produced . At least a less reformist and less verbose bourgeois
democratic regime proper ensures a continued supply of basic
necessities such as food .

The PNP lost the support of both the ruling class (internal and Conclusion
external) and the working class and the oppressed, because by
1980 it served the interests of neither class effectively . At the
same time the bloody offensive of the Jamaican bourgeoisie and
the American state against the PNP was due to factors of ideology,
rhetoric and international relations, rather than in response to
policies such as expropriation, wholesale land nationalisation,
and so on, which would have directly enhanced the well-being of
the working class and created a major shift in the balance of
power in Jamaican society .
The Marxist economist Osker Lange once wrote : `An
economic system based on private enterprise and private property
of the means of production can work only as long as the security
of private property and of income derived from property is
maintained . The very existence of a government bent on intro-
ducing socialism is a constant threat to this security . Therefore,
 CAPITAL & CLASS

172 the capitalist economy cannot function under a socialist govern-

ment unless the government is socialist in name only .' (Lange
1964 : 123) . The experience of the Manley regime however,
suggests that Lange's last sentence needs a small but noteworthy
amendment : the capitalist economy cannot function under a
socialist government unless the government is socialist in name
only and, in adddition, does not espouse rhetoric and pursue
foreign policies which create alarm and uncertainty among the
bourgeoisie . But thus doing, the flight of capital and bourgeois
sabotage is obviated, or at least the likelihood of such an event-
uality has been relatively minimised .
This addendum is necessary because the Manley regime
was `socialist in name only', yet the capitalist economy did not
function under the PNP administration . And this decline and
catastrophic stagnation of the capitalist economy in Jamaica was
caused primarily by the uncertainty about the future engendered
by the (at least in hindsight) disingenuous and pugnacious rhetoric
of the PNP.
As such, the whole trajectory of the PNP regime tragically
demonstrated (for yet another painful time) the limits of reform-
ism . The self-professed vanguard of the Jamaican class and
oppressed must seriously draw the evident conclusions from this
experience : the mythology (which has been dangerously elevated
to the dizzy heights of a political strategy), of an alliance between
a (non-existent) `patriotic national bourgeoisie' and the working
class, should be abandoned . (Cf. Post 1980 : 14-16 and Aubursley
1981) The more difficult but ultimately more fruitful task of
creating a genuinely independent organisation of the working
class free of disingenuous uncritical `critical support' of what
amounts to a section of the Jamaican bourgeoisie, is of vital
necessity if the genuine process of the emancipation of the
Jamaican working class and oppressed from wage slavery as well
as chattel slavery is to be begun and realised . One must never
forget that the Manley regime was a bourgeois regime with a
conscience, but a bourgeois regime nonetheless . Needless to say,
no bourgeois regime or party has led or can lead (by definition)
the working class and oppressed (despite how reformist it may
pretend to be) to the final assault on the ramparts of capitalist
relations of production . It is a patently absurd fantasy to expect
the bourgeoisie to expropriate itself.
The PNP is, and the Manley regime was, reformist but
bourgeois : their reforms never challenged nor did they intend to
challenge, capitalist relations of production in Jamaica . The PNP
regime objectively merely attempted to ameliorate the conditions
of the working class within the confines of bourgeois society so
that the latter could function so much the better . The PNP was
 JAMAICA 1972-1980

merely the `bomb disposal expert' which came on the scene at the 173
end of the ineffectual JLP governments of the 'sixties to render
harmless the time bomb of excessive poverty, oppression and
growing resistance, threatening the very foundations of capitalism
in Jamaica .
The Jamaican bourgeoisie and its external partners in their
typically parsimonious short-sightedness and fear of greater
radicalisation did not allow this attempt to succeed . The PNP did
not effect any really serious (and even less, lasting) reforms never
mind fundamental change . The problems of Jamaican society
which afflict the poor and exploited are deep-rooted and funda-
mental . And serious and fundamental problems require serious
and correspondingly fundamental solutions .
I am not alone in the holding of the view that the massive
mandate of December 1976 could have been used by the PNP, had
the latter so wished, to advance the process of working class unity
in an effort to make an assault on the exploiters of the Jamaican
working people . Instead the PNP, partly for the political reasons
mentioned above, but also partly as a consequence of its short-
sightedness in economic policies turned to the IMF for `help'
whose policies, even by its own yardstick, simply did not work .
The major and indeed predictable consequence of the turn to the
IMF was that the Jamaican people suffered immense hardships .
For this reason it was not at all surprising that the PNP was voted
out of office .
Manley in his recent book, (1982 :221) re-affirmed his
pledge if re-elected in the future, to once again follow what he
 CAPITAL & CLASS

174 terms the `Third Path' . By this he means a route to economic and
social development which is neither synonymous with the `Cuban
Road' (which he regards to be `totalitarian') nor the `Puerto
Rican Model' (which he regards to be economically inegaliarian) .
In short, he intends to continue on the same course which he
followed between February 1972 and October 1980 . From the
analysis attempted here, it should be clear that there is no good
reason to think, or even believe, that the results for the Jamaican
people will be any less disastrous than the previous experiment .
This is why Jamaican socialists should perhaps take more seriously
than ever the Marxian maxim : `The emancipation of the working
class must be the act of the working class itself .
In the meantime Jamaica, under the austere and authori-
tarian rule of Edward Seaga (Reagan's willing and favourite
Caribbean vassal), celebrated its twentieth anniverary of In-
dependence in August last year, ironically, perhaps more a colony
than it ever was in 1962 . Two years ago, Seaga came to power
under the slogan of `Deliverance', and he has in fact delivered .
But what he did not tell the Jamaican electorate at the time was :
who was going to be delivered to whom? Now the people of
Jamaica no doubt know .

I am grateful to the editors of Capital and Class, especially Judy

W ajcman and Andy Friend for their valuable help in the preparation of
this article . I would also like to thank Fitzroy Ambursley, Robin
Cohen, Honor Ford-Smith, Stuart Hall, Richard Hart, Rod Prince,
Ian Roxborough, Amon Saba Saakana and Jasmine Taylor for their
comments on earlier drafts of this text . I alone, however, am
responsible for any errors of judgement or fact therein .

Notes 1 More details on the following incidents can be found in T . Lacey

(1977), on which the ensuing paragraphs on outbreaks of violence are
based .
2 For the seminal analysis of the `twenty-one families' see Reid
(1977) . Unfortunately, due to lack of space a section on the history of the
PNP had to be omitted from this article . Readers who are interested in
exploring the history of the PNP in greater depth are therefore referred to
Post (1978 and 1981), Munroe (1972), Harrod (1972), Lindsay (1978),
James (1983c), Cohen (1982) and James (1983a) . The latter two are
review articles on the Post volumes .
3 In 1979 and 1980, no doubt due to the over deepening crisis of the
economy, the subsidies to industry decreased to J$150 .8m and J$93 .lm
respectively .
4 IBRD/World Bank, (1981 :73) . Manley admitted to a us Con-
gressional delegation that `there was some excessive rhetoric' during the
early years of his government which discouraged investors and entrepre-
neurs . `But, we have tried to change the atmosphere for investors .'
Manley, in his recent book, however, has attempted to dismiss the
argument that rhetoric played a crucial role . He nevertheless had to


JAMAICA 1972-1980

concede that there were cases of what he terms `irresponsible comments' 175
(1982 :125)
5 In 1976 alone, it was conservatively estimated that over us$300m .
had left the country illegally.
6 Manley, on the return from his historic state visit to Cuba (an
experience which seemingly influenced him deeply) told millionaires
that they were not wanted in Jamaica and advised would-be millionaires
that there were five flights per day from Jamaica to Miami .
7 This remark was made by an IMF official ; see Financial Times,
April 3, 1980 . Cf. also A Sampson (1981 :30) . I have not examined the
role of the IMF in Jamaica at any length in this essay because frankly, it
would not have revealed anything new about the IMF and its role in the
third world and especially the effects of its prescriptions for reformist
regimes in such countries : the consequences of the IMF policies were
predictable and thus somewhat of a foregone conclusion . What is impor-
tant for understanding the dynamic of the regime is precisely why it had
to turn to the IMF in the first place for, what is euphemistically and
inaccurately called, `assistance' . Indeed, Manley himself, interestingly
enough, had this to say in his New Year's Address to the Nation of 1979 :
`There are people in Jamaica who really believe that the IMF is the cause
of our present difficulties . This is not so . Actually, the presence of the
IMF is an indication of how bad the problems are' . (M . Manley `New
Year's Message to the Nation 1979', in appendix to us House of Repre-
sentatives (1979 :37)) . In this clear attempt to appease the IMF and stem
the tide of growing opposition to its policy at the time, Manley's analysis
clearly bends the stick too far in the opposite direction, and as such his
conclusion, though having a certain element of truth in it, lacks verisi-
militude . The fact of the matter is that although it is true that the IMF
came on the scene ostensibly to help solve the extant problems of 1977,
by 1979 its policies had palpably and disastrously failed . Indeed, it had
seriously exacerbated the problems of the Jamaican economy . As such
then, by 1979, although the IMF had apparently intervened in the economy
to aid in the solution of the `difficulties' (as Manley has kindly put it), it
also had by then itself become a part of the problem it was supposed to
have put right .
For more on the IMF in Jamaica see the important article by
Girvan et . al., (1980) and also N. Girvan, (1980) .
8. `But let them (the capitalist - wl) understand, we ask for
co-operation . But understand, if they will not co-operate, the socialist
movement will find other ways to run the industries' . M . Manley
(1976 :17) .
9. `We have termed this tendency for government expenditures to
outrace revenues the `fiscal crisis of the state' . J . O'Connor (1973 :2), A
Maingot (1979) .
10 . Inspired by the Organisation of Petroleum Exporting Countries
(OPEC) the IBA came into being on July 29, 1975 with its headquarters in
Jamaica . Its members are Australia, the Dominican Republic, Guinea,
Guyana, Haiti, Jamaica, Sierra Leone and Surinam .
11 . For more on the relations between the companies see S . Keith and
R . Girling, (1978), F . Goff, (1978 :8-9) and M . Moskowitz et . al .
(1980 :542ff) . Thomas O . Enders, then Assistant Secretary for Economic
and Business Affairs, in the us Dept . of State, told a Congressional
hearing in 1974 that not only did the companies work in `unison' on the
Jamaican bauxite levy, but in addition `not only were we (the State


CAPITAL & CLASS

176 Department-w1) very closely informed of the course of this negotiation,

but we did express to the Jamaican government in as clear terms as we
could what we thought would be the consequences of certain actions
proposed by them .' us Congress (1974 :185ff) .
12 . Thus Manley, Horace Clarke (the former Minister of Mining)
and officials of the IBA, urged Sekou Toure, the President of the Republic
of Guinea, on his visit to Jamaica, to, along with the other members of the
IBA, develop strategies to prevent `each being played off against the
other .' Not surprisingly, nothing positive emerged from their talks .
Weekly Gleaner, Sept . 19, 1979 . Cf. Manley (1982 :100-102) .
13 . us Congress (1974 :60) . Charles Parry (Manager, Corpor
ate Planning, Aluminium Company of America - AICOA), explicitly
stated that the bauxite industry was the worst one in which to develop a
cartel - the metal is far too common in his view to sustain such an
endeavor . Parry believed that the industry would be adversely affected in

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 JAMAICA 1972-1980

the short-run, but was confident that the problems would be overcome in 177
the long-run, precisely because of the fragility of the IBA . See us House of
Representatives (1974 :329ff) .
14 . Cf. W .A . James (1981 :16) for more on this . Significant though it
was, Manley in his new book does not even mention this retreat by the
PNP . The impression given by his book is that the PNP stuck to its guns
right down the line . And this is not true .
15 . `More oil flows through the Caribbean in one day than through
the Strait of Hormuz,' said Ms . Sally Shelton, us Ambassador to the
Eastern Caribbean . Washington, Oct . 17, 1980, Inter Press Service (IPs) .
I am extremely grateful to Rod Prince and his colleagues at Latin
American Newsletter in London, for giving me access to their files of
unpublished press releases and other information on the Caribbean .
16 . S . Keith and R . Girling, (1978 :31) . Cf . A . Pollack (1976 :5) This
is also borne out by Manley (1982 :97ff) . For a highly informative and
moving document on the Cuban `mission' to Angola, see the article by
the celebrated Columbian novelist, Gabriel Garcia Marquez, (1977) .
17 . Despite his vacillations and sometimes downright reactionary
policies at home, to his eternal credit Manley, maintained a consistently
radical and principled stance on the liberation movements of the world
and especially those of Southern Africa .
18 . This was the remark of Philip Habib, Carter's special envoy to the
Caribbean, after a visit to the area . See Caribbean Business News . Vol XI,
No . 2, Feb . 1980 .
19 . For the Jamaican press campaign see for example F . Landis
(1980) and for the North American press, see Cuthbert (1979) and
Landau (1976 :49-55) . These press campaigns, especially in North
America, were aimed at, and had the effect of, derailing the tourist
industry which after bauxite is the largest single earner of foreign ex-
change for Jamaica . Visitors from the USA (which accounted for over 75%
of all tourists to the island in 1975), declined by 39 .5% between 1975 and
1977 as the distorted reports of violence in Jamaica hit the headlines of
the North American newspapers and magazines . And although the net
receipt from foreign travel increased from the all time low of J$42 .6m . in
1976 to reach J$85 .2m. in 1977, this seems to have been largely due to
nominal increases (as the Jamaican dollar became devalued) as opposed to
a real jump in expenditure by visitors to Jamacia, since, while in 1975 and
1976, American visitors to Jamaica expended us$118m . and us$109m .
respectively, in 1977 they had spent even less that they had in 1976 .
Department of Statistics (1980 :550&556) Bolyard (1978 :65) .
20 Manley in his book (1982), of course writes of the compulsory
union recognition, generalised minimum wage, maternity leave and
redundancy payments, which were introduced by his government, but
makes no mention whatsoever of the anti-strike clauses in the Act . Thus,
on this point and indeed several others, Manley distorts the true record of
his regime not so much by the explicit lies but by significant and
misleading silences . It is not surprising then, that reviewers (especially in
the UK) who are understandably somewhat ignorant of the intricacies of
the Manley regime have, with the exception of only one, remarked upon
the `honesty' of the former Prime Minister's book . But how can one tell if
a report is honest or accurate if the external evidence which is necessary
 CAPITAL & CLASS

178 to provc or disprove its veracity has not been examined? This is the
question which the reviwers of the book in The West Indian World, The
Caribbean Times and more surprisingly, City Limits and Socialist
Challenge did not ask . The only reviewer who has attempted to seriously
come to grips with the book is Cecil Gutzmore (1982) . But unfortunately,
Gutzmore concentrated on the inaccuracies to be found in the historical
section of the text to the detriment of an adequate handling of those
extant in the later sections of the book which deals with the PNP regime
proper in the 1970's .
21 On December 2, 1982, the 10 policemen indicted with the
murder of Claudius Massop and indeed, two other people who were
travelling with him in the taxi when the police opened fire were found
`not guilty on any count' . This verdict was reached in spite of the fact that
the prosecution had called 20 witnesses, including the driver of the taxi
which was transporting Massop at the time he was killed, in support of
the case of murder . (The Weekly Gleaner, 15/12/82) . It has been widely
alleged that after helping to found the Peace Movement, Massop broke
with the JLP . Furthermore, he had apparently told Edward Seaga that he
had intended to stand against the JLP leader in the forthcoming general
elections in the latter's Western Kingston constituency . It was also
claimed, that Seaga, angered by this challenge went so far as to publicly
slap Massop across his face and called him a `boy' . The policemen
accused of murdering Masop are widely believed to have been JLP
supporters .
22 Although there are certain striking similarities between Salvador
Allende's Popular Unity government in Chile and Manley's `democratic
socialist' regime in Jamaica, in the realm of land reform the former
accomplished far more in less than two years than the latter did in some
eight years and eight months . Thus while Manley was playing games
with the 'landgods' of Jamaica, and giving the peasants tiny plots of
barren land, `By the end of 1972 Popular Unity had completed its
expropriation programme which gave the agrarian reform area 33% of
agricultural production, about 20% of the total rural labour force, and
about 50% of the irrigated land of the country' . I . Roxborough, P.
O'Brien and J Roddick (1973 :137-138) Emphasis mine .
23 The situation of course, deteriorated in tandem with the rest of
the economy . The consumption of fertilisers, for instance, in Jamaica in
1971 was 80,000 tons, in 1977 it was halved to 40,000 tons . Imports of
agricultural machinery and implements declined sharply from J$10m . in
1975 to J$2m in 1977, a fall of 80% . See us Dept . of Agriculture
(1978 :23-29) .
24 See us Dept . of Agriculture (1978) for more on the poverty of the
Jamaican peasants ; cf. Robotham (1977), Miller, (1974) Beckford,
(1974) and Williams (1975) .
25 It really is passing the buck when it is argued that the economy
was destroyed because of imperialist and capitalist machinations . There
is, evidently, a world of difference between conspiring towards the over-
throw of a regime and succeeding in doing so. It seems to me, and it is
indeed more obvious by now, that if a regime carries out measures of one
sort or another, that the us finds offensive, then that regime should
expect a retaliation . Such a reaction is predictable . The resistance of
 JAMAICA 1972-1980

capitalists to what they consider to be measures inimical to their interests 179

is as intrinsic to the capitalist mode or production as the insatiable thirst
for profit . This has become especially evident since the Cuban Revo-
lution, the Dominican intervention, the Vietnam War and the Chilean
experiment . It must therefore, be taken as a matter of course by now that
the enemy is going to wreck economic and political havoc, and `play holy
hell' with regimes such as the PNP's . Therefore, the onus of blame is
always on the side of the regime if such measures are allowed to succeed
without putting up a serious and concerted fight . And the PNP by no
stretch of the imagination, can be adjudged to have put up such a
struggle .

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 George Georgiou

The political
economy
~V of military
i expenditure
Writers on the political economy of
military expenditure and the arms race
are categorised into several schools of
thought . Emphasis is put on the tech-
nical and historical limitations of the
arguments put forward by each school .
The author argues that the dynamic
nature of the historical process results
in socio-political and economic
changes within a specific mode of pro-
duction thus making attempts to for-
mulate a general theory of military
expenditure futile .

Introduction
The end of the Second World War
has usually been interpreted as the onset 183
of a period of peace, a period where for
the past thirty six years the major in-
dustrialised countries have, the Cold
War apart, coexisted without conflict .
However, a very different picture
emerges when one considers the number
 CAPITAL & CLASS
184 of post-1945 conflicts throughout the
world which have included revolutions,
military coups, civil wars, and inter state
wars, and which have either directly or
indirectly involved the two major
superpowers .
The period 1945-60 saw the develop-
ment of three phenomena that have come
to dominate the current international
political and strategic environment .
These were ; the creation of two compet-
ing military powerblocks, NATO domin-
ated by the USA, and the Warsaw Pact,
dominated by the Soviet Union, the pro-
liferation of nuclear arms, and an arms
race incorporating both conventional
and nuclear weapons .
Arms races between competing states
are nothing new . Indeed, arms races and
military expenditure are both the con-
sequence and the expression of militar-
ism in general, which is itself not specific
to the capitalist mode of production .
We can, as Leibknecht (1973) does,
distinguish between capitalist and non-
capitalist forms of militarism but this is
operationally unhelpful since within a
specific mode of production militarism,
as expressed through military expendi-
ture (ME) and the arms race, will change
over time . For example, before the
Second World War ME had an essentially
quantitative aspect whereas after the
War it took on an increasingly qualitative
aspect so much so that the qualitative
aspects have now overtaken the quanti-
tative aspects . No longer is the argument
just about the quantity of armaments
and troops but rather it is about the
quality of the arsenal, specifically which
country has the type of sophisticated
nuclear weapons and weapons systems
which are capable of inflicting the utmost
devastation upon its enemy . In fact if we
concentrated only on the quantitative
aspects of military expenditure and the
arms race by looking at the share of ME in
GNP spent by the two superpowers we
might conclude that since 1969 the arms
race has not been as intense as, say,
between 1951 and 1954 . But such a con-
clusion would ignore such recent dev-
elopments as the neutron bomb, cruise
missiles, trident, polaris and pershing
missile systems, SS-20 missiles, SAM, etc,
the R & D into, if yet not deployment of,
chemical weapons, and numerous im-
provements to existing weapons systems,
etc .
Even if we ignore the qualitative
aspects of ME and concentrate only on
the quantitative aspects then it still re-
presents a large proportion of current
economic resources devoted to the means
of destruction, as is shown by Table A .
Yet despite the increasingly ferocious
attack that is being undertaken by the
Governments of the liberal bourgeois
democracies on public expenditure many
of these governments are commited to
increasing ME in real terms . Several
questions arise : what role does ME play
in capitalism? Does it stimulate capital-
ism or does it contribute to its demise?
How do economists analyse the arms
race? Can ME and the arms race be
analysed by economists independently
of the socio-political dimension? And
perhaps more importantly, can there be
a general theory of ME and the arms race
or are they historically contingent?
The purpose of this paper is to bring
to the attention of the reader the dif-
ferent theoretical approaches which have
attempted to answer some of the above
questions . The paper will not, therefore,
be concerned with the specificity of the
current debate on deterrence and dis-
armament, but instead it will be con-
cerned with the political economy of
militarism with particular emphasis on
ME and the arms race .
 MILITARY EXPENDITURE

185
TABLE A'

Military Expenditure 1979

US $ mn %GDP

USA 112,279 5 .2
Canada 4,119 1 .8
Belgium 3,631 3 .3
Denmark 1,518 2 .3
France 22,667 4 .0
W. Germany 24,777 3 .3
Italy 7,784 2 .4
Netherlands 5,037 3 .4
Norway 1,453 3 .1
UK 19,121 4 .7
Austria 863 1 .3
Sweden 3,493 3 .3
Switzerland 2,053 2 .2
Japan 9,337 1 .0
Australia 3,100 2 .7

Source : SIPRI Yearbook 1982

For reasons of conciseness and ac- can be classified as a) theoretical

cessibility the discussion will be pre-
sented in a taxonomic manner concen-
trating only on the major and, in some
cases, most original contributors to each
school of thought . Thus for example in
discussing the underconsumptionist
approach within the Marxist school we
refer only to the works of Baran and
Sweezy, and Kidron even though there
have been more recent underconsump-
tionist contributions . Most of these
recent contributions are merely restate-
ments, albeit in a different form, of
Baran and Sweezy's original thesis .
Before we discuss the major schools
an important caveat needs to be in-
serted . The presentation of the various
approaches to ME and the arms race is
not theoretically sacrosanct or scientifi-
cally more correct than any other cat-
egorisation . For example an alternative
categorisation may be literature which
economic analysis, b) macro-statistical
analysis, using aggregate data from
various national economies, or c) micro-
structural analysis, using case studies re-
lating to the level of the individual firm .2
However, it is our belief that the categ-
orization presented in this paper is, con-
ceptually, the simplest (i .e . the least
technical and the most jargon free) and
hence the most accessible to the non-
economist . It is also useful in that it
enables us to identify the political,
ideological and theoretical perspectives
of the literature which are not always
explicitly stated by the writers .
1 . Marxist approaches
The current debate on the left re-
garding disarmament has focused es-
sentially on the socio-political and
strategic aspects of the arms race paying

little attention to the economic aspects of
this arms race which itself is only one
aspect of military expenditure and more
generally, militarism . What little has
been said of the economic aspects of
militarism has been either in the context
of the juxtaposition of arguments for and
against the maintenance of the welfare
state in the light of the present Tory
government's attempt to dismantle it, so
that, for example, when arguing in
favour of the health workers pay claim
one argument that has been employed is
along the line `if the Government found
the money to finance the Falklands War
then it can find the money to finance the
health workers pay claim' ; or, in the
context of arguments about the costs of
defense in general and the costs of
specific defense projects . There is, how-
ever, a tradition amongst marxist politi-
cal economists, stretching back to Marx
and Engels, which has considered
various aspects of militarism, including,
certainly in the case of Rosa Luxem-
burg, the political economy of military
expenditure .
The term `Marxist school' en-
compasses a large body of literature
which itself can be divided into sub-
categories so that within this school we
can identify four approaches and these
are the approaches of (i) Marx and
Engels, (ii) Rosa Luxemburg, (iii) the
underconsumptionists, most notably
Baran and Sweezy, and writers associ-
ated with the theory of the Permanent
Arms Economy, and (iv) recent non-
underconsumptionists .
• strategy depend above all on the stage
Marx and Engels
There is in Marx and Engels no
systematic analysis of militarism . What
•
analysis there is seems to deal specifically
with wars, strategy, and the
•
development of weapons, rather than
MILITARY EXPENDITURE
with militarism in general and military 187
expenditure in particular . This neglect
of militarism in Marx and Engels work is
not the `astonishing' omission that
writers such as Silberner (1946) claim it
is . Even Silberner acknowledges that
Marx and Engels were concerned with
the historical genesis, functioning, and
ultimate fate of capitalism and not with
any particular sector of the economy .
Thus it is no more `astonishing' for them
to have omitted an explicit and
comprehensive analysis of militarism
than it is for their omission of an explicit
and comprehensive analysis of
education, public health, etc .
For Marx and Engels militarism,
particularly in the guise of war, is a social
and political phenomenon which has
economic consequences . Moreover the
cause and conduct of militarism tend to
be related to economic factors . In other
words militarism is seen to be a phenom-
enon or consequence of the social and
political superstructure of society where
the latter is dependent upon the
economic base . This is argued most
clearly by Engels in `Anti-Duhring' . In
discussing the army and navy Engels
says, `Force, nowdays, is the army and
navy and both as we all know to our cost
are `devilishly expensive' . Force, how-
ever, cannot make any money . . .force is
conditioned by the economic order,
which furnishes the resources for the
equipment and maintenance of the in-
struments of force" Furthermore, their
(army and navy) `armaments, com-
position, organisation, tactics and
reached at the time in production and
communications . It is not the `free
creations of the mind' of generals of
genius which have revolutionised war,
but the invention of better weapons and
changes in the human material, the
 CAPITAL & CLASS
188 soldiers' . 4
In a well known quote, Marx seems
to share the views of Engels, thus he
says, `Is there anywhere where our
theory that the organisation of labour is
determined by the means of production
is more brilliantly confirmed than in the
human slaughter industry' .'
A serious contradiction in Engel's
writings on militarism is to be found in
his attitude towards the relationship
between war and socio-political and
hence economic progress . At a con-
ference of the International Working
Men's Association held in London in
1871, Engels argued that wars paralyze
socio-political and hence economic pro-
gress . However in 1888 we find Engels
arguing that a world war would result in
the `general exhaustion and the estab-
lishment of the conditions for the ulti-
mate victory of the working class' . The
contradiction seems to arise because
Engels does not make it clear whether
his 1871 statement refers only to localised
wars or whether it refers, as does his
1888 statement, to world wars .
Rosa Luxemburg
Luxemburg was the first marxist to
deal explicitly with the political economy
of ME . In `The Accumulation of Capital'
Luxemburg cites several functions of
militarism in a capitalist economy . First,
militarism, in the form of conquest,
serves as a catalyst for primitive ac-
cumulation . Secondly, following the
conquest of the New World, militarism
serves to subjugate the peoples of this
conquered world by force and repression
thus creating colonies in which the in-
digenous population becomes divided
into classes . This force and repression
involves, inter alia, the destruction of the
indigenous cultures and industries of the
newly created colonies and imposing
upon these colonies political, social and
economic hegemony . Thirdly, militar-
ism is responsible for `enforcing the
claims of European capital as inter-
national leader" . Fourthly, militarism
serves as a weapon in the struggle be-
tween capitalist states for the domi-
nation of the non-capitalist world .
Luxemburg then proceeds to iden-
tify what she claims to be a `purely
economic' function of militarism . The
purely economic function of militarism
is that `it is a pre-eminent means for the
realisation of surplus value ; it is in itself a
province of accumulation' .' It is this
purely economic aspect of militarism
that Luxemburg is concerned with and
her analysis makes use of Marx's scheme
of expanded reproduction using two de-
partments. Department I produces the
means of production and Department II
produces the means of subsistence .
The kernel of Luxembourg's argu-
ment is that militarism is financed by tax
revenue ; specifically indirect taxation
extorted from the working class by the
state . How this affects the capitalist
sector will depend on the form that the
military expenditure takes .
Luxemburg first considers the case
where indirect taxes are levied on the
working class which are then used to
finance the salaries of state officials and
regular army personnel . In this case
Luxemburg argues that there would be
no change in the reproduction of social
capital as a whole . `Both Departments II
and I remain constant because society as
a whole demands the same kind of
products in the same quantities ." In
other words the capitalist sector does not
benefit since the scale and pattern of
demand for goods produced by capital-
ists remains unchanged as does the
average rate of profit . As Rowthorn
(1980) points out to arrive at this con-

clusion Luxemburg explicitly assumes
that the reduction in the consumption of
goods by the working class (a result of
the indirect taxation), is exactly matched
by an increase in the consumption of the
same goods by the state officials and the
regular army . Whilst this assumption
may hold in the abstract there is no
attempt by Luxemburg to justify such
an assumption .
Luxemburg then considers the case
where the indirect tax revenue is used by
the State to finance the production of
weapons . The result of a weapons pro-
ducing sector will be to establish a secure
market for the products of modern in-
dustry and also to increase the average
rate of profit . To show this Luxemburg
employs a numerical example using
Marx's scheme of expanded repro-
duction the details of which need not
detain us here : suffice it to say that in
order to arrive at this conclusion
Luxemburg employs what Tarbuck
calls `slapdash methods' which result in
her making `elementary mistakes in the
handling of the schemes' .'
We have already stated that
Luxemburg considers military expendi-
ture financed by taxing the working
class as being beneficial for the capitalist
sector since the effect will be to increase
the average rate of profit . The increase
in the rate of profit comes about because
the indirect taxes extorted from the
working class can be thought of as a
reduction in wages which acts to boost
profits . Alternatively one can think of
the indirect taxes as reducing v so that
assuming s remains constant then
r= ( s/v )
c/v + 1
increases . This of course assumes that
the increase in s/v will be larger than any
actual increase in c/v .
MILITARY EXPENDITURE
The argument that s/v increases rests 189
on the assumption that s remains con-
stant when workers from the civil sector
are transferred to the arms sector . In
other words when the civil sector shrinks
due to the levying of indirect taxes on the
working class, the transfer of surplus
workers from this sector to the arms
sector does not affect surplus value
because these workers were originally
producing consumer goods for the
working class and were not therefore
(according to Luxemburg) creating sur-
plus value . This argument is made by
Luxemburg in the folowing terms : `the
value of the aggregate social product may
be defined as consisting of three parts,
the total constant capital of the society,
its total variable capital, and its total
surplus value, of which the first set of
products contains no additional labour,
and the second and the third no means of
production . As regards their material
form, all these products come into being
in the given period of production -
though in point of value the constant
capital has been produced in a previous
period and is merely transferred to new
products . On this basis, we can also divide
all the workers employed into three mutually
exclusive categories : those who produce the
aggregate constant capital of the society,
those who provide the upkeep for all the
workers, and finally those who create the
entire surplus value for the capitalist class .
If, then, the workers' consumption is
curtailed, only workers in the second
category will lose their jobs . Ex hypothesi,
these workers had never created surplus
value for capital, and in consequence
their dismissal is no loss from the capital-
ists' point of view but a gain, since it
decreases the cost of producing surplus
value' .' °
The above quoted passage contains
several serious mistakes . Rowthorn

CAPITAL & CLASS
190 points out that in this passage Luxem-
burg confuses use-value with value and
surplus product with surplus value .
Moreover, Luxemburg classifies labour
as being productive or unproductive ac-
cording to who buys its produce . This
differs from the usual categorisation of
productive and unproductive labour
where labour is considered to be pro-
ductive if it produces surplus value
under the direct control of the capitalist .
Once we accept the usual definition of
productive labour then Luxemburg's
argument no longer holds because it is
quite possible that when workers are
transferred from the civil sector to the
arms sector surplus value in the former
sector will actually fall and not remain
constant . The fall in surplus value may
match or even exceed the fall in v and
thus the rate of exploitation may remain
constant or even fall rather than rise as
postulated by Luxemburg .
Luxemburg's analysis is further
flawed by her argument that one can
treat the workers producing aggregate
constant and variable capital, and aggre-
gate surplus value as mutually exclusive .
This is wrong both from an empirical
and .theoretical point of view . Consider
the circuit of industrial capital for a
single capitalist :
M C P C' M'
LP MP LP MP S that the appropriate price theory of firms
(v) (c) (v) (c) (M' + M)
Suppose the individual capitalist is a
producer of cars using standard methods
of production on a production line in a
multi-purpose plant . The implication of
Luxemburg's argument is that we can
somehow differentiate, in this hypo-
thetical plant, workers producing v from
those producing c and those producing
s! Moreover, not only can we differen-
tiate these groups of workers but each
group is mutually exclusive from the
other!
The Underconsumptionist School
By 'underconsumptionist' we mean
simply the school of marxist economists
associated with the argument that mili-
tary expenditure aids caitalism by ab-
sorbing the surplus it produces, a
surplus which canot otherwise be ab-
sorbed due to lack of effective demand .
The two writers most closely associated
with the underconsumptionist expla-
nation of military expenditure are Baran
and Sweezy .
Baran and Sweezy
In `Monopoly Capital' Baran and
Sweezy argued that under monopoly
capitalism there is a tendency for ag-
gregate economic surplus to rise .
Economic surplus is defined to be `the
difference between what a society pro-
duces and the costs of producing it ."'
What is the cause of this tendency and,
more importantly for our purposes, how
is the surplus absorbed?
With regard to the first question
Baran and Seeezy argue that the answer
is to be found in the price and cost poli-
cies of the large corporations . Assuming
that corporations are profit maximisers
and accumulators of capital, they argue
under monopoly capitalism is the mono-
poly price theory of neo-classical
economics . Whereas neo-classical econ-
omics treats monopolies and oligopolies
as exceptions to the rule under mono-
poly capitalism such exceptions become
the rule . In oligopolistic price theory it is
difficult to reduce prices (they tend to be
`sticky' in a downward direction) and
since large corporations under monopoly
capitalism adopt such pricing behaviour

then, combined with the observation
that large corporations tend to pursue a
policy of minimising costs, which they
are able to do through economies of
scale, `it follows with inescapable logic
that surplus must have a strong and per-
sistent tendency to rise' . 'Z
Having established the cause of the
tendency of surplus to rise under mono-
poly capitalism Baran and Sweezy pro-
ceed to answer the second question `How
is the surplus absorbed?' They identify
three ways in which the surplus may be
absorbed . First, by capitalist con-
sumption ; secondly, by capitalist in-
vestment ; and thirdly, by waste . Under
the heading `waste' is included a) the
sales effort (advertising, product differ-
entiation, etc) ; b) government expend-
iture for civilian purposes (welfare
services such as transfer payments, edu-
cation, etc) ; and c) military expenditure .
The authors emphasise the importance
of c) followed by b) and a) respectively .
Their thesis is very simple . Basically,
they argue that it is in the military sector
of the economy that most of the expan-
sion in the absorption of surplus has
taken place . Moreover should such ex-
penditure be reduced it would have a
detrimental affect on the economy .
Speaking of the USA's post-Second
World War prosperity, they state : `This
massive absorption of surplus in military
preparations has been the key fact of
postwar American economic history . . .
If military spending were reduced once
again to pre-Second World War pro-
portions, the nation's economy could
return to a state of profound depression
. . . such as prevailed during the
1930's' ." And again, `the difference
between the deep stagnation of the
1930's and the relative prosperity of the
1950's is fully accounted for by the vast
military outlays of the 50s' ."
MILITARY EXPENDITURE
Several criticisms of their thesis can 191
be made . First, is it true that there is a
tendency for the economic surplus to
rise under monopoly capitalism? For
example, Bleany has argued that their
analysis of the tendency of surplus to rise
depends to a large extent on the
assumption that the working class is
powerless or at least passive and thus it
cannot determine or even influence the
size of the surplus . Once this
assumption is dropped, then it does not
necessarily follow that there is a
tendency under monopoly capitalism for
the economic surplus to rise . The size of
the economic surplus will, presumably,
be contingent on the state of the class
struggle .
Secondly,it can be argued that their
concept of surplus is, unlike the marxian
concept of surplus value, too general and
hence not specific enough to the
capitalist mode of production .
Thirdly, Baran and Sweezy are not
clear as to how military expenditure is
financed . Some writers would consider
this important in determining the
resulting effect on the absorption of the
surplus . For example, Kalecki (1974)
argued that if militarism is financed by
taxing the working class then the effect
upon the absorption of national product
is negligible because the new markets for
armaments are offset by a reduction of
workers consumption . But if armaments
are financed by governments borrowing
in the bond market then the surplus is
sold by capitalists in exchange for the
revenue obtained by the government
through the sale of securities to the
financial capitalists .
Although "Monopoly Capital" was
first published in 1966 more recent
marxist writings on military expenditure
have been merely restatements of the
orginal thesis of Baran and Sweezy" . An
 CAPITAL & CLASS
192 example of such a restatement is the
work of Kidron and his thesis of the
Permanent Arms Economy .
Kidron and the Permament Arms
Economy
Kidron's (1970) thesis as expanded in
his book `Western Capitalism since the
War' is that post-World War II western
capitalism has been faced with a per-
manent threat of overproduction and
unemployment and that what prevented
capitalism during the 1950s and 1960s
from actually collapsing into over-
production and unemployment was a
permanently high level of military ex-
penditure identified as the Permanent
Arms Economy (PAE) .
According to Kidron, the PAE
stabilises capitalism by stimulating in-
vestment, demand for labour (manual
and non-manual), technological 'spin-
off, and international trade . Military
expenditure is effective because a) it is
politically and ideologically acceptable
to the bourgeoisie whilst at the same
time having no adverse effect on the
general rate of profit ; and b) it has a
'domino-effect' which gives rise to an
arms race which in turn acts to stabilise
capital on an international, as well as
national, scale .
Kidron's thesis bears a close re-
semblance to the underconsumptionist
thesis of Baran and Sweezy . Whereas the
latter talk of the `tendency for economic
surplus to rise', the absorption of such a
surplus being constrained by a deficiency
in the effective demand for com-
modities, Kidron talks of the `permanent
threat of overproduction' . One is merely
a corollary of the other .
An important criticism Purdy (1973)
makes of Kidron, and one that is applic-
able to Baran and Sweezy also, is that his
thesis is ahistorical . For Purdy the arms
race is `a historically specific feature of a
particular stage of capitalist develop-
ment 76 and it is precisely this historical
aspect of the arms race that Kidron's
analysis ignores . Instead, Kidron, as
with other underconsumptionists such
as Baran and Sweezy, treats military
expenditure in an ahistorical functional-
ist manner : he is concerned with the
economic function of military expend-
iture within an unchanging capitalist
economy .
Before we can consider the writings
of the recent non-underconsumptionist
school we need to clarify why we dis-
tinguish between Rosea Luxemburg and
the orthodox underconsumptionist
writings of political economists such as
Baran and Sweezy .
Up until 1976 the consensus view
amongst economists on the Left was that
Luxemburg was an underconsumption-
ist . Amongst the many economists who
interpreted Luxemburg in this manner
were Dobb (1955), Kalacki (1971),
Kemp (1967), Sweezy (1970) and Rob-
inson in the Introduction to Luxemburg
(1971) .
A typical statement from these
economists is that of Robinson in her
Introduction to Luxemburg's `The Ac-
cumulation of Capital' where she states :
`The analysis which best fits Rosa
Luxemburg's own argument, and the
facts, is that armaments provide an outlet
for the investment of surplus (over and
above any contributions there may be
from forced saving out of wages), which,
unlike other kinds of investment, create
no further problem by increasing pro-
ductive capacity (not to mention the
huge new investment opportunities
created by reconstruction after the capi-
talist nations have turned their weapons
against each other)' ."
Bleany (1976) has put forward the

argument that the underconsumptionist
interpretations of Luxemburg are
wrong . Bleany argues that whilst there is
a superficial resemblance to a Mal-
thusian type of underconsumption
theory ultimately Luxemburg's theory
cannot be classified as underconsump-
tionist because at no stage in her analysis
is it specifically consumer demand that
is lacking : " . . .although she frequently
phrases the question in terms of con-
sumers, it would be more accurate to
designate it as one of demand or of
markets, words which do not have as-
sociations with a specific branch of pro-
duction . In any case, the mistake which
lies at the bottom of her analysis has
nothing to do with a conception of the
special importance of consumption
goods production, but relates to her
understanding of the general process of
the circulation of capital' . II
A more recent attempt to defend
Luxemburg against the accusations of
being an underconsumptionist has been
that by Rowthorn . His defense of Lux-
emburg is neatly summarized in the fol-
lowing quote : ` . . .Rosa Luxemburg had
a very broad vision of militarism's role in
the accumulation of capital, as a factor
aiding the development of dynamic and
technically progressive branches of pro-
duction and clearing away internal
obstacles to capitalist expansion . Such a
vision is very different from a Keynesian
approach which stresses the short-term
conjunctural problem of effective
demand and ignores more fundamental
problems of long-term development' . 19
Recent Non-Underconsumptionists
Two examples of the recent non-
underconsumptionist literature are pro-
vided by the work of Kaldor and Smith .
W e first look at the work of Kaldor . For
Kaldor militarism in the us (and by
MILITARY EXPENDITURE
implication in the Western World) 193
`must be understood in terms of a
decline in the us economy, that the rela-
tively high level of military spending . . .
reflects and reinforces this decline' . 20
This thesis rests on three propositions :
first, a constant peacetime increase in
the production of arms both absolutely
and in relation to GNP marks the begin-
ning of a period of economic decline ;
secondly, military production gathers a
momentum of its own which stems from
the momentum of the arms industry ;
and thirdly, an increase in military pro-
duction and/or military expenditure in
general, accelerates the process of
economic decline .
The first of Kaldor's propositions is
based on the observation that the most
important military techniques are
usually based on the dominant in-
dustries . As the dominant industries
begin to decline, due to, say, a recession,
many companies face the threat of col-
lapse and so one way of saving some of
these companies is through the increase
in the number of military contracts .
The second of Kaldor's propositions
is based on the observation that in the
traditional arms industry technical pro-
gress takes the form of improvement in
the products rather than improvements
in the method of producing these pro-
ducts . The result is an ever increasing
sophistication of weapons which are
more and more expensive to produce .
Kaldor's third propositon is based on
the assertion that an increase in ME in-
volves a diversion of resources away
from dynamic and productive industries
into declining and/or unproductive in-
dustries . In order to give some substance
to this assertion Kaldor argues that a)
there is an inverse correlation between
the share of GNP devoted to ME and the
share of GNP spent on capital investment
 CAPITAL & CLASS

194 (see table B) ; and b) countries in which
expenditure on military research and
development (R & D) is low, experience a
high expenditure by firms on productive
civil R & D (see table C) .
`Taken together, the three propo-
sitions - that an increase in the procure-
ment of arms is a response to economic
decline, that the procurement of arms
attains an independent momentum, and
that an increase in the procurement of
arms accelerates economic decline -
amount to a feedback mechanism in
which the armament process becomes
part of a more general process of
economic decline' . 21
Smith (1977) argues that the preva-
lent view amongst left wing writers, that
military expenditure is necessary to off-
set a tendency towards stagnation within
capitalism, is not supported by empir-
ical evidence . He rejects the undercon-
sumptionist view on theoretical grounds
also, arguing that such a view assumes
that there is a purely economic `function'
for ME . Smith offers an alternative ex-
planation arguing that ME is a contra-
dictory requirement of capitalism : `At a
political and ideological level it is necess-
ary to the system, but its economic con-
sequences are such that it undermines
what it was meant to maintain' .22
Smith's explanation of ME en)phasises
its strategic requirement for dapitalism :
`the need to create a political and mili-
tary superstructure to defend the
economic system' . 23 There are three
dimensions to this strategic requrire-
ment . First, capitalism needs to be de-
fended against communism in the guise

TABLE B 24

USA UK France FRG Netherlands Sweden Japan

1963 Military burden 8 .8 6 .2 5 .6 5 .2 4 .4 4 .2 1 .0
Rate of
investment 16 .8 15 .2 20 .0 25 .7 22 .1 22 .0 27 .9
1973 Military burden 6 .0 5 .0 3 .8 3 .4 3 .4 3 .4 0 .8
Rate of
investment 18 .0 18 .0 25 .0 25 .5 24 .0 22 .0 37 .2

TABLE C25

Patterns of Resources Devoted to Research and Experimental Development in the OECD

Area, 1963-71
R&D as a percentage of GNP

USA UK France FRG Netherlands Sweden Japan

Government 1 .4 1 .2 1 .1 0 .9 0 .6 0 .8 0 .5
Defence Space
Nuclear 1 .1 0 .6 0 .7 0 .3 0 .3 0 .1 0 .1
Other 0 .3 0 .6 0 .5 0 .6 0 .3 0 .7 0 .4
Business Enterprise 1 .0 0 .9 0 .6 1 .1 0 .9 1 .1 1 .2
Other 0 .1 0 .1 - 0 .1 0 .1 -
Total 2 .5 2 .3 1 .8 2 .1 1 .6 2 .0 1 .6


MILITARY EXPENDITURE

of the Warsaw Pact . Secondly, in order
to maintain capitalist confidence on an
international scale, a hegemonic power
is needed, (the USA) . This dominant
power arises from military strength .
Finally, ME enables the ruling class with-
in each capitalist state to enhance its
dominant position and hence preserve
the existing order . Thus ME in this con-
text refers not just to the money spent on
military hardware, but also to the money
spent on para-military forces, on propo-
ganda aimed at fostering feelings of
nationalism and patriotism, on internal
security aimed to counteract potential
rebellion, etc, in other words, money
spent on the ideological capabilities of
militarism .
The discussion of the preceding
strategic aspects of ME is not exclusive to
Smith, indeed such strategic aspects are 195
discussed by under-consumptionists
,such as Magdoff (1970) . Where Smith
differs from the underconsumptionists
is his empirical results which lend
support to the thesis that far from con-
tributing to the economic stability of
capitalism ME actually contributes to its
demise by reducing accumulation and
growth . On the basis of results such as
those in Table D, Smith concludes that
the ME incurred by some of the advanced
capitalist economies has `imposed a
substantial cost, primarily in terms of
over accumulation and slower
growth' ."
Further substantiation of Smith's
conclusion can be found if we compared
Table E with Table F . From Table F we
see that the USA and the UK have sub-

TABLE D 27

Correlation matrix for 15 industrial countries, between ME and other economic

variables .
------------------
C 0 .34
I -0 .73* -0 .76*
CG 0 .01 -0 .08 -0 .30
Y 0 .72* 0 .14 -0 .41 0 .20
Y/P 0 .54* 0 .04 -0 .38 0 .36 0 .49
G -0 .54* -0 .50 0 .63* -0 .36 -0 .18 -0 .58*
S -0 .26 -0 .08 0 .25 -0 .21 0 .16 -0 .29 0 .54*
P -0 .38 -0 .16 0 .27 0 .16 -0 .44 -0 .30 0 .36 0 .09
M C I CG Y Y/P G S

* Significantly different from zero at the 95% level .
M = Share of ME in GDP
C = Share of private consumption in GDP
I = Share of investment in GDP
CG = Share of civil government expenditure in GDP
Y = 1965 GDP, Y/P = 1965 per capita GDP
G = Average growth rate
S = Standard deviation of growth rate, 1960-70
P = Average rate of inflation
 CAPITAL & CLASS

196
TABLE E28
Growth rates of GDP and GDP per employee for 12 Developed Countries for the period
1951-70*
Per Cent Per Annum
Countries GDP Employment GDP/Employee

Japan 9 .5 1 .6 7 .9
W . Germany 6 .0 1 .2 4 .8
Italy 5 .3 0 .6 4 .6
Netherlands 5 .2 1 .2 4 .0
Austria 4 .9 0 .3 4 .6
France 4 .7 0 .3 4 .4
Canada 4 .5 2 .3 2 .2
Denmark 4 .4 1 .1 3 .3
Norway 4 .1 0 .4 3 .7
Belgium 3 .7 0 .5 3 .2
USA 3 .6 1 .7 1 .9
United Kingdom 2 .6 0 .6 2 .0
* The period 1951-70 was used except in the following cases :
Japan 1953-69, Canada 1951-69, USA 1951-69, France 1951-69, Denmark 1954-69, UK
1951-69 .

TABLE F 29
The pattern of Military Expenditure (ME) .
Shares of ME in output*(%) 1973
1954 1964 1973 Total ME Per Capita ME
($ billion) ($)

Canada 7 .0 3 .6 2 .0 2 .4 109
Us 11 .6 8 .0 6 .0 78 .4 372
Belgium 4 .8 3 .4 2 .7 1 .4 139
Denmark 3 .2 2 .8 2 .1 0 .6 125
France 7 .3 5 .3 3 .8 9 .8 189
W . Germany 4.0 4 .6 3 .4 13 .3 215
Italy 4 .0 4 .6 3 .4 4 .1 75
Netherlands 6 .0 4 .3 3 .4 2 .1 157
Norway 5 .0 3 .4 3 .1 0 .7 169
UK 8 .8 6 .1 5 .0 9 .0 161
Switzerland 2 .7 2 .8 2 .0 0 .8 124
Sweden 4 .9 4 .1 3 .4 2 .0 246
Austria 0 .1 1 .5 1 .0 0 .3 39
Japan 2 .1 0 .9 0 .8 3 .7 35
Australia 3 .6 3 .4 2 .7 2 .0 154
* Output is GDP at purchasers' prices .

stantially above average shares of ME in
GNP, and yet from Table E we see that it
is these two countries that have ex-
perienced the lowest growth rate in GDP .
Conversely, we see that Japan's share of
ME in GDP has been below average and
yet Japan has experienced the fastest
growth in GDP . Finally we see that
Denmark's share of ME in GDP has been
close to the average and this has also
been the case with regard to its growth
rate .
2 . Non-Marxist Approaches
The non-Marxist literature can be
divided into three schools of thought .
The first is the liberal school which
places emphasis on the Military In-
dustrial Complex (MIC ) and/or the in-
ternal bureaucratic process of military
related decision making . It maintains
that militarism is irrational and that dis-
armament is both desirable and feasible .
The second school has a long tra-
dition in game theory and is usually re-
ferred to as the action-reaction (A-R)
school . With regard to ME the A-R school
maintains that `actions by one nation
trigger specific reactions by the other
that offset whatever advantge the first
nation gained by its initial action 70 . The
result is a zero sum game" .
Finally, the third school is the neo-
classical school which assumes that the
state pursues the objectives of maximum
output and maximum security where the
latter is directly related to ME .
The Liberal School
At the centre of the liberal approach
to militarism is the concept of the MIC .
Rosen (1973) lists the following charac-
teristics of the MIC :
1) The MIC consists of a class of in-
dividuals whose interests are served by
MILITARY EXPENDITURE
defence spending' . 197
2) The MIC arises because the super-
powers devote a considerable proportion
of GNP to ME .
3) The MIC justifies its existence by
manipulating, not always consiously, the
fear of an external threat . This external
threat provides the rationale for ME
which in turn depends on the Cold War
and the concomitant arms race .
How the MIC operates is not clear .
For example, for Rosen the MIC should
be understood as a complex interaction
of interests wheras for Melman (1971)
the MIC operates in a quasi-conspiratorial
manner . Liberals see peace itself as
being desirable and that militarism, in
the guise of war or peacetime arms
production, is irrational and immoral .
Moreover militarism is seen as having no
significant economic role . The percep-
tion of militarism as irrational and
immoral is shared by other schools and is
therefore not exclusive to the liberal
school ." However the liberal school
adopts a very naive attitude towards the
curtailment of militarism in general and
military expenditure in particular . For
example, Rosen argues that there should
be closer monitoring of R & D, more
public accountability by the MIC,
balancing the power of opposing
bureaucratic and corporate alliances, and
in the long-run, `alternation of threat
perspectives to weaken the strategic
rationale' .
An important criticism of the liberal
school has been made by Smith (1976)
who argues that the liberal explanation
of militarism which concentrates on the
concept of the MIC is compatible with an
explanation which sees wars as being an
accident rather than as the outcome of
inter-state (or inter-imperial) rivalry .
Thus the Vietnam war can be explained
by a liberal as being a `mistake' gener-

CAPITAL & CLASS
198 ated almost unintentionally by what
Mills (1970) called the `power elite' or
what the liberals call the Mic . Hence
although war may be generated by poli-
ticians pursuing a `hard-line' for re-
election, by generals seeking promotion,
and by the military-industrial firms
seeking to maximise profits, such wars
are not, according to liberals, in the
`national interest' or in the interests of
capitalism . The implication of this
which is explicitly advocated by Rosen,
is that once we remove these 'baddies'
from the centre of the political arena,
then together with the correct monetary
and fiscal policies in order to accomodate
civil rather than military production,
disarmament and peace is perfectly
feasible .
With the possible exception of Mel-
man, liberals tend to neglect the
economic role of ME . They avoid asking
questions about the relationship
between ME and the standard economic
variables such as investment, growth,
profits, inflation and unemployment, in
other words accumulation in general .
Given this neglect of the economy it is of
little surprise that liberals see the 'sol-
ution' to militarism purely in terms of
politics, that is the removal or political
control of the MIC .
The Action-Reaction (A-R) School
The essence of the A-R thesis can be
summarised by the following statement
made by the former American Secretary
of Defence, Robert McNamara : `What
is essential to understand is that the
Soviet Union and the United States
mutually influence one another's stra-
tegic plans . Whatever be their inten-
tions, whatever be our intentions,
actions - or even realistically potential
actions - on either side relating to the
build-up of nuclear forces, be they either
offensive or defensive weapons, necess-
arily trigger reactions on the other side .
It is precisely this action-reaction
phenomenon that fuels an arms race' . 34
In other words actions by one nation
lead to reactions by another that offset
any advantage the first nation may have
initially gained . An important implicat-
ion of the A-R thesis is that the arms race
is irrational since no one can gain an
advantage, at least no one can sustain
that advantage . The result is an intense
arms race which can result in war .
The first systematic statement of the
A-R thesis was made by L F Richardson
in 1919 and expanded later in 1939 39 and
1960 . 36 Richardson begins with the
premise that the stimulus to, or the slow
down, in the arms race between two
nations (or two groups of nations), call
them X and Y, is motivated by fear,
mistrust, and rivalry . Added to this is
the assumption that there is a tendency
for countries to reduce their `armaments
in order to economise expenditure and
effort' ." Using the aforementioned
assumptions, Richardson derives the
now classic equations which provided
the springboard for subsequent A-R
theorists . Richardson's equations are as
follows,
dx/dt = C<- ax + a3 (1)
dy/dt = f ~ - 2y + fl 3 (2)
where x and y represent the strategic
budgets of countries X and Y respect-
ively, t = time, c( i and f , are 'de-
fense' (or military) coefficients, V( 2 and
A 2 are `fatigue' or expense of keeping
up defence coefficients, and OC 3 and
3 are `grievance' (or domestic socio-
political terms) . In order for (1) and (2)
to be stable or tend towards equilibrium
(peace), then (q( 2/ m( i) > (-P, / . 2)
or ( Q( 2 # 2)>(o( P i) . If
( d 2 P 2)<( OC 1 0 ) then the system

is unstable and it gives rise to an un-
limited arms race . On the basis of (1) and
(2) Richardson concluded that increasing
strategic budgets would tend to increase
the probability of war .
A-R models of the Richardson type
have been criticised by Intriligator
(1975) for being too mechanisitc : `it
looks at the arms race from the outside as
a mechanistic model rather than from
the inside in terms of decisions made by
defense planners' ."
The simple process described by A-R
models ignores the long lead times re-
quired for the introduction of new
weapons sytems . Including the time re-
quired for research, design, develop-
ment and deployment, these lead times
vary between five and twelve years . Such
long lead times `limits the speed of re-
sponse to new developments on the other
side' . 19 The picture is complicated by
uncertainty so that research and de-
velopment must not only be in response
to the opponent's recent acquisitions but
must `anticipate potential threats and
potential requirements' ."
Finally, the picture becomes com-
plicated by a variety of other factors such
as tactical doctrines, cultural factors
which favour certain types of warfare,
economic and bureaucratic constraints,
and political constraints which threaten
41
the cohesion of the various alliances .
It was due largely to the dissatis-
faction with A-R models of the arms race
that led to the development of the
Bureaucratic Decision Making approach
within the liberal School . An example of
this approach is the work of Allison (1974
and 1971) . 42
Allison argues that the interaction
between us and Soviet strategic forces
does not take the form of specific actions
triggering specific reactions . `Instead,
uncertainty about enemy activity and
MILITARY EXPENDITURE
long lead times in weapons acquisition 199
cause the interaction to look more like a
general competition in which the United
States tries to anticipate weapons
development in the Soviet Union and
stay assuredly ahead' ." An understand-
ing of the true process of this general
competition can only be understood, if
we view governments as `conglomerates
of large organisations and collections of
political actors', 44 each actor playing its
own role but at the same time competing
with other actors for power and
influence .
An important implication of Allison's
thesis is that the arms race cannot neces-
sarily cease or even continue as a result
of international negotiations between the
two superpowers . Negotiations should
be on an intranational as well as inter-
national level, for the internal bureau-
cratic decision making process is as much
an obstacle to the control of arms pro-
curement and military expenditure in
general, as is the traditional rivalry be-
tween the two superpowers .
This approach has been criticised by
Smith for failing to explain why the
organisations concerned have the power
to implement their objectives . `Just as
individuals are constrained by their
bureaucratic roles, organisations are
constrained by the social, economic and
international forces that ultimately
determine military expenditure' .45
The Neo-Classical (N-C) School
Most people on the left assume that
neo-classical economists fail to, and are
incapable of, conceptualising the role of
the capitalist state . While this may in
general be true, neo-classical economists
specifically use the case of defense as an
example of what they define as a pure
public good (see below for definition)
supplied by the state in contrast to private
goods produced by the private sector .
 CAPITAL & CLASS
200 The N-C school assumes that there is a
well defined national interest which the
state seeks to protect . Conflict is seen as
external to the nation state which
threatens this well defined national
interest . The implication of these two
assumptions for the macroeconomic
analysis of ME is that a model can be set
up in which it is assumed that there is a
well defined social welfare function, 46
W, which the state wishes to maximise
subject to a set of constraints . W can be
assumed to be a function of civilian out-
put and security, and security can in
turn be assumed to be a function of ME .
From these and other assumptions one
can derive military production and
demand functions 47 which can be sub-
jected to econometric testing in order to
determine the macro-economic effects
of ME . Although much of N-C writing is
concerned with the micro-economic
effects of ME the preceeding macro-
approach can be found in the works of
several N-C writers . The micro-economic
approach concentrates on the efficiency
of arms production at its stages of design,
production, and deployment and this is
done by using mathematical optimis-
ation techniques .
The N-C school, in general, treats ME
as a public good when considered on a
national scale but points out that it need
not necessarily be a public good when
considered in the context of alliances .
The characteristics of a pure public good
are : that it be undepletable (its provision
to one consumer does not reduce the
provision available to another con-
sumer) ; that it be supplied in equal
amounts to all consumers ; and finally,
that it be non-excludable (once the good
or service is provided for one section of
the community it does not exclude other
sections of the community from con-
suming it) .
Defense is often regarded as a pure
public good because once it is acquired,
the community as a whole benefits . Thus
as well as fulfilling the characteristics of
non-exhaustiveness and being supplied
in equal amounts to all consumers, it
also fulfills the important characteristic
of non-exclusiveness . But some writers
within the N-C school question whether
defence can be considered a public good
when considered in the context of
alliances such as NATO and the Warsaw
Pact . Defense in the international con-
text will or will not be considered a public
good depending on its ability to act as a
deterrent .
Finally, the N-C school sees the arms
race as being rational and argues that
deterrence is important . Military ex-
penditure is justified on the grounds that
it is necessary to strengthen the us
economy in order to allow, relative to the
Soviet Union, a greater amount of re-
sources to be devoted to military pro-
curement . This argument is best sum-
marised by Hitch and McKean : ` . . . the
greater our economic strength, the more
desirable things we can do, and the better
we can do them . . . We cannot buy per-
fect protection against thermonuclear
attack by any combination of active and
passive defenses, but perhaps we can
afford enough defense to reduce Russian
confidence of complete success to the
point where she is deterred from striking .
Perhaps on top of all this, we can afford a
positive economic foreign policy which
will preserve our alliances and increase
our influence on developments in the
uncommitted parts of the world' ."
Several criticisms can be made of the
N-C school . First, nowhere does the N-C
school define precisely what it means by
the `national interest' . In the context of
much of what is written it seems to us
that the term `national interest' is nothing

more than a euphemism for the interests
of private capital .
Secondly, most of the N-C literature
treats conflict as being external to the
nation state, thus it ignores the militar-
ism whose origin is internal to the socio-
political system, concentrating instead
of military produrement for inter-
national conflicts .
Thirdly, Smith argues that the N-C
literature has poor explanatory power
because it fails to deal with the 'complex-
ity and uncertainty of international
relations and the conflicting interests of
groups within soceity' . 49
Finally, it is difficult to take the N-C
school seriously when complex inter-
relationships between military expendi-
ture, militarism and the arms race cannot
be handled within a framework of simple
formal equations however neat they may
look .
Conclusion
The purpose of this article was to
summarise the existing approaches used
to analyse military expenditure and the
arms race . As we have seen each approach
has its drawbacks with perhaps the
underconsumptionist school of the
Marxist approach, the N-C school and
the A-R school suffering the most . This
in fact raises the question of whether one
can indeed formulate a complete theory
of military expenditure . The answer is
simply no . This is because apart from
the theoretical and technical problems of
the analysis which raises questions on
methodology, scope of analysis and pur-
pose of analysis there is the simple but
awkward fact that the politico-economic
system and its concomitant militarism as
expressed through the arms race and
military expenditure are historically
contingent and specific except for neo-
MILITARY EXPENDITURE
classical economists who think that 201
history and economics are mutually ex-
clusive . As was quoted by Purdy, earlier
`the arms race is a historically specific
feature of a particular stage of capitalist
development' . So that, for example, it
may well be the case that the Permanent
Arms Economy, as Kidron argues, pro-
tected capitalism during the 1950s and
1960s from crises arising from a tendency
to overproduce . But how (without listing
a number of contingencies, as Kidron
does) can one reconcile this thesis with
the fact that we are now in a period of
crisis despite the existence of high levels
of ME . Or, how can the thesis explain the
phenomenon that during the period
1950-71 the Netherlands, Austria and
Japan had high growth rates despite the
fact that their share of ME in GNP was
lower than average (see Tables E and F) .
Or, how can we explain the propserous
periods of capitalism during the 19th
century when although ME was high it is
debatable whether the system consti-
tuted a permanent arms economy 5 o
Another example of the historical
limitations of the various schools on
military expenditure and the arms race
can be seen in the neo-classical approach .
Even if we accept its assumptions that
governments pursue objectives of maxi-
mum civilian output and security, where
security is dependent on ME, this im-
plicitly suggests that an increase in
security requires an increase in military
expenditure . But when we examine the
qualitative as well as quantitative aspects
of ME and the arms race it becomes
obvious that armaments before the
second world war were markedly dif-
ferent from armaments after the war, so
much so that society, which in the neo-
classical world is supposed to determine
preference rankings, may actually feel
that its objectives with respect to security
 CAPITAL & CLASS
202 may be maximised not be increasing ME
but by actually reducing it . Indeed this
is how advocates of nuclear disarmanent
interpret the increasing popularity of
CND and the peace movement in general .
People increasingly feel that security and
peace would be best served by abandon-
ing the nuclear arms race, an arms race
whose underlying irrational logic
Thompson has called the `logic of
exterminism' .
I am indebted to Jerry Coakley and Tony
Addison for their comments, suggestions
and encourgement . I am also grateful for
the comments of an anonymous referee and
for the prompt typing by my wife, Stella .
The usual disclaimers apply .
Notes
1 . Taken from Smith and Georgiou (1982),
p .3 .
2 . For a survey of these approaches see Smith
and Georgiou, op cit.
3 . Engels (1977), pp 187-88 .
4 . ibid.
5 . Marx and Engels (1934) . Quote taken
from a letter from Marx to Engels, dated
London, 7th July, 1866 .
6 . Luxemburg (1971), p .454.
7 . ibid .
8 . ibid, p .455 .
9 . Tarbuck (1977), p .153 .
10 . Luxemburg, op cit, p .463 .
11 . Baran and Sweezy (1975), p .23 .
12 . ibid, p .76 .
13 . ibid, pp . 155-56 .
14 . ibid, p .176 .
15 . See for example Finkelhor and Reich
(1970), Kidron (1970), Magdoff (1970), Reich
(1972), Cypher (1974), and Mandel (1975) .
16 . Purdy (1973), p .23 .
17 . Joan Robinson in the Introduction to
Luxemburg, op cit .
18 . Bleany (1976), pp .200-201 .
19 . Rowthorn (1980), pp .251-52 .
20 . Kaldor (1976), p .4 .
21 . ibid, p .10 .
22 . Smith (1977), p .61 .
23 . ibid, p .74 .
24 . Taken from Kaldor (1976) p .26 .
25 . Taken from Kaldor (1976) p .27 .
26 . Smith, op cit, p .76 .
27 . Taken from Smith, ibid p .71 .
28 . Taken from Allsop (1977), p .21 1 .
29 . Taken from Smith, ibid p .62 .
30 . Allison (1974), p .425 .
31 . It is called a `zero sum game' because in
game theory it describes the situation where
no matter what is done by either one of two
competitors the total gain to both of them will
be zero .
32 . For a neo-marxist analysis on the ir-
rationality of the arms race see Thompson
(1980) .
33 . Rosen (1973), p .24 .
34 . Quoted in Allison (1974) .
35 . Richardson (1939) .
36 . Richardson (1960) .
37 . Richardson (1939), p .3 .
38 . Intriligator (1975), p .339 .
39 . Freedman (1980), p .3 .
40 . Allison (19764), p .427 .
41 . See Freedman, op cit .
42 . See also Rattinger (1975) .
43 . Allison (1974), p .435 .
44 . Ibid .
45 . Smith (1976), p .10 .
46 . A social welfare function is defined in
orthodox economic theory as 'a preference
ranking placed by society on a set of alter-
native economic situations', Bannock et al
(1977), p .379 .
47 . A production function is `mathematical
relationship between the quantity of output
of a good, and the quantities of inputs re-
quired to make it', Bannock et al, op . cit
p .329 .
A demand function expresses `The relation-
ship between the quanitity of goods which a
consumer wants to buy, and all the quantita-
tive factors which determine this demand
e .g . price of the good, prices of complement-
ary goods', Bannock, op cit, p .107 .
48 . Hitch and McKean (1975), pp . 18-19 .
49 . Smith, op cit, p .5 .
50 . A sophisticated underconsumptionist
argument which takes into account the con-
tradictory requirements of ME is put forward
by Lo (1976) .

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