With hyperinflation looming and automation abolishing the source of profit, world socialism is becoming an absolute economic necessity (FAQs part 1)

30 min readJan 6, 2020
The general rate of profit tends historically towards zero. Source: Estaban Maito

Since the necessary development of automated production is abolishing capital’s theft of commodity-producing labour’s labour time (the real source of profit), capitalism is losing its ability to create sufficient amounts of exchange-value and profit to renew and expand itself and is sooner or later likely to spiral into a crisis of worldwide hyperinflation and collapse. Socialism (the lower stage of communism), whereby privately-owned enterprise is turned into socially-owned enterprise, is therefore becoming an economic necessity *for the first time*. Combined with ongoing technological leaps, it will increasingly enable sustainable abundant material wealth *for all* (leading to higher communism, when the state becomes irrelevant and withers away).

Is worldwide hyperinflation really looming?

➤ The record high aggregate global debt is unsustainable since the tax base needed to repay it is shrinking in relative terms. Global debt across all sectors increased by over $10 trillion in 2019, topping $255 trillion. At over 322% of Gross Domestic Product (GDP), that put global debt 40 percentage points ($87 trillion) higher than at the onset of the 2007–09 financial crisis. Nation-states that fail to push their debt back below 90% usually go on to default on their debt (fail to repay it) and go bankrupt. The actual figure has been reported to be 2.5 times higher (as of July 2019) and 2.5 times higher than the global money supply (as of 2015, up from two times higher in 2013).

As of 23 November, 21% of all US dollars in circulation had been printed in 2020, taking the figure to 75% over the past 12 years. The dollar is being devalued at record speed, but this only reflects the devalution of commodities, driven by innovation — the quicker and more abundantly commodities are made, the cheaper and less profitable each commodity tends to become.

That is despite unprecedented growth in the money supply as governments have electronically ‘printed’ money to deal with the devaluation of capital caused by technological leaps in productive capabilities and the manifesting shortage of exchange-value being created by commodity-production (see below). In the eurozone, 57% of all government debt repayments are (as of 2015) interest.

➤ Lifting the economy out of recession has required on average since 1958 a baseline interest rate cut of 6% (in order to cheapen capital to incentivise lending and borrowing); but since the (worst ever) stock market crash in March 2020, rates are already at zero (having been cut from 0.75% in the UK and 1.75% in the US — neither country had ever gone below 1% before 2010). In fact, they have been more or less stuck at zero since 2009.

Going lower still into negative rates would mean charges on bank deposits along with, quite likely: bans of high dominations of cash (so it can be converted into stocks and bonds in order to lower the interest rate, hence the so-called ‘war on cash’); and charges on low dominations; wealth taxes; and ‘bail-ins’ whereby banks stave off solvency by seizing assets from customers or converting deposits into equity.

‘The Buffet indicator’ — total market capital of stocks divided by GDP. The average value of the US stock markets is historically around 50–100% of GDP, but it has climbed to over 200%, indicating an enormous, unprecedented financial ‘bubble’, the third in the past three decades. Before that there had been one since the bubble that preceded the 1929 Wall Street Crash.

All this may reinflate the global bond (debt) bubble for another few years or so but it is a limited option since there is only so much cash that can be converted into stocks; and will also require increasingly massive amounts of central bank money printing to push up the prices of bonds (thereby lowering interest rates). How negative can negative rates go — there must be a limit.

Monetary financing, as this is called, will continue to devalue the money supply and has historically led to hyperinflation after collapses in productivity relative to demand. The trillions of dollars of sovereign debt already subjected to negative rates, meaning investors are essentially paying for the privilege of lending money, has been remarkably and increasingly high since 2014. Banks, many of which are already close to going bust, have warned that making base rates too negative would make privately owned banks unviable.

➤ Eventually even the richest countries will default on their debt. Central banks such as the Federal Reserve in the US just about managed to bail out most major banks in the 2007–09 crisis, thanks to a sufficient devaluation and centralisation of capital (the necessary solution to every capitalist crisis/recession), accelerating rises in monopolisation, poverty and inequality. Will it be possible for the International Monetary Fund (IMF) to bail out the Federal Reserve, let alone the world economy? And even if it can, who will bail out the IMF when an even bigger crisis emerges in another decade or so?

“The decrease in interest rate is a symptom of the annulment of capital only inasmuch as it is a symptom of the growing domination of capital in the process of perfecting itself — of the estrangement which is growing and therefore hastening it’s annulment.” — Karl Marx / “The rate of interest is related to the profit rate in a similar way as the market price of a commodity is to its value…. The general rate of profit, in fact, reappears in the average rate of interest as an empirical, given fact.” — Henryk Grossman

➤ Eventually central banks will run out of cash to convert into stocks and the debt bubble will burst as interest rates start going back up, making government debt increasingly expensive to pay-off and leading to surges in debt-to-GDP and panic selling as investors realise that the government is broke.

All the money central banks have printed will become worthless, likely leading to hyperinflation (or, if the central banks reverse course and shrink the money supply, hyperdeflation, which would follow the former anyway).

➤ Bondholders will dump bonds and instead panic buy hard assets, especially precious metals, adding to the potential for hyperinflation. Central banks may be forced to purchase dumped bonds, sending national (public) debt ever-higher.

➤ Capitalists also use high/hyperinflation in a crisis anyway to effectively torch wages, debt and taxes, i.e. in order to centralise capital into fewer hands and rewiden profit margins.

Automation is abolishing the source of profit? What?!

➤ Alongside 0% interest rates, British pound sterling has lost more than 99.5% of its purchasing power since its adoption as official currency in 1694. The US dollar has lost more than 96% of its purchasing power since 1913, having barely changed in the previous 140 years when the rate of the economy’s growth (relative to its size) was much higher. The vast amount of that figure, 91%, has come since 1949, when the US supplanted Britain as the world’s imperialist superpower. The figure since 1970 is 85% (93.5% for Britain), when capitalism entered its first major post-war crisis and the technological (digital/automation) revolution really took off, with currency’s link to gold becoming a restraint on economic growth (since gold’s finite nature limited the number of dollars that could be printed).

➤ Of the roughly 750 currencies that have existed since 1700, less than 20% remain.

➤ GDP growth rates are trending towards and already closing in on zero, having been around 6% in the 1960s and below 2% since 2000.

Decade-by-decade average GDP growth rates in what the World Bank defines as ‘high income countries’ are trending towards zero.

➤ The aggregate global rate of profit is also trending historically towards zero, having fallen from an estimated 43% in the 1870s to 17% in the 2000s.

➤ Between 1964 and 2014, the average lifespan of S&P 500 companies shrank from around 60 to 18 years.

➤ The Energy Return on Investment (EROI) on fossil fuel has fallen from above 100:1 (a return of 100 units of energy for every 1 invested) before the 1930s to around 3–6:1 in 2019. According to Sid Smith, all forms of energy production are becoming unprofitable.

➤ Production costs and consumer commodity prices have trended secularly/historically towards zero, since commodities tend to become cheaper the faster and more abundantly they are produced. For example, whereas the world’s fastest supercomputer in 1975 was worth $5m ($32m in 2013’s money), the price of an iPhone 4 released in 2010 with the equivalent performance was $400. Aerospace companies producing propulsion systems in 2010 for $24m in 24 months are now 3-D printing their engines for $2,000 in two weeks (see Aaron Bastani, Fully Automated Luxury Communism, p. 123.) One gigabyte of data storage, for example, fell from around $200,000 in 1980 to just $0.03 in 2014.

While it took 13 years and billions of dollars to sequence the first human genome, the cost had fallen to below $100 by 2017 and will soon be zero. The plummeting price of solar energy will make fossil fuel — long the driving force of capitalism due to the labour intensity of its production — obsolete within a decade. The price of oil fell below zero for the first time ever in April 2020.

Such developments mean companies are increasingly likely to find it cheaper to produce ‘at home’ instead of exploiting overseas labour and transit workers (who transport commodities).

As Rethink X states: “Our food system is being transformed as we learn how to make affordable high-quality proteins and other molecules [through lab-grown ‘cellular agriculture’ and ‘precision fermentation’ (programmed microbiolisation; a form of automation)] without the need to grow plants and animals. The DNA of a single soy plant or chicken will be enough to create an unlimited quantity of soy or chicken proteins. Our newfound ability to design and produce infinite organic compounds like we design apps or videos will likely distribute the power to engineer our own food cheaply, sweeping away the industrial dairy and meat industries.”

In 2000, the cost of producing one kilogram of one type of molecule through precision fermentation cost $1 million, but in 2020 the cost had fallen to around $100. In 2020, precision fermentation was on course to become cost-competitive with bulk animal protein, which stood at around $10 per kg for casein and whey, by 2025. It is expected to fall below $10 per kg by 2025, before becoming five times cheaper than traditional animal proteins by 2030, and 10 times cheaper by 2035. As soon as a company like Nestle starts buying its milk this way — as it must to rewiden its own profit margins — the conventional farming industry will collapse.

“The capitalistic mode of production… is never able to get out of that ‘vicious circle’… this circle is gradually narrowing… the movement becomes more and more a spiral, and must come to an end.”
— Friedrich Engels, Socialism, Utopian and Scientific, 1877

➤ Machines cannot sell their labour power (capacity to work) and are therefore unexploitable; i.e. they do not produce surplus value, i.e. surplus labour time, the time the worker works beyond their necessary labour time (the value of their labour power and cost of subsistance). Surplus labour time is thus surplus value that the capitalist appropriates from the worker and realises through the sale of commodities.

The real measure of value is time. For example: If the worker creates eight hours worth of value a day, she only keeps roughly what she needs to pay to reproduce herself and her dependents (living costs/necessary labour time); three or four hours, for example, with the other four or five (surplus labour time) going to the capitalist. The capitalist continually needs to increase and maximise surplus value production, i.e. towards eight out of eight hours (in our example). Profit is therefore essentially unpaid (surplus) labour (time).

At the same time, as productivity rises through innovation, the costs of subsistence tend to fall, and so the rate of exploitation (the ratio of surplus to necessary labour time) can actually rise while living standards — at least in terms of the absolute number of commodities consumed — rises.

Capital’s exploitation of labour’s labour time is obscured by the money-wage relation, what Marx called the commodity fetish (money/gold being the money-commodity).

The trend of increasing surplus labour time cannot, of course, exceed 24 hours a day, making the expansion of surplus value production historically limited. Although workers cannot physically work round the clock, arguably capital’s plundering of personal/private data from smart phones and computers is now moving the dynamic rapidly towards 24/7 exploitation (and stealthily reintroducing/expanding child labour). Data is now more profitable than oil.

Furthermore, the necessary labour time of the most productive workers in the automation age — scientists, engineers, coders, etc — is high, since the character of their labour is increasingly complex. It includes the cost of their qualifications, computers and other equipment. Their surplus labour time is therefore high in absolute terms but increasingly low in relative terms. Producing a unit of data invariably takes almost no labour time at all, for example.

Because the means of production are consumed during the production process, their value is only preserved by absorbing the labour time of the workers who at the same time replace the consumed means of production. (Oil is consumed during the production of oil, for example.)

So as productivity rises, the amount of surplus value absorbed by the means of production tends in the long run to fall, and so the value of the means of production also falls until it becomes unprofitable to invest in.

➤ Services workers are relatively unproductive/unexploitable — in terms of surplus value produced per commodity — since they only tend to handle finished/near-finished commodities. Even Africa and Latin America have been deindustrialising (moving from manufacturing to predominantly services-based workforces) over the past decade.

➤ Automation, a necessary development due to capital accumulation’s ongoing need for ever-rising productivity growth — not to mention humanity’s natural tendency to innovate to save labour and enhance life — is therefore abolishing the source of surplus value, exchange value and profit. To be more precise, automation is the final expression of capitalism’s self-abolishing tendency.

➤ Capital itself is a generally ever-growing fetter (restraint) on investment and productivity growth, which has spluttered below 1% in the richest countries over the past decade, since the ever-rising overaccumlation or surplus of capital, expressed in debt, or disused or destroyed means of production (or that which is reconverted into productive capital via devaluation), is an expression of the increasingly unprofitability of (re)investing in production (hence increasing trillions of dollars hoarded in tax havens, or chucked into speculation, waiting for profitable investment opportunities in production to turn up).

Rethink X also predicts total systemic collapse within the decade.

➤ Capital accumulation is approaching a historical limit as capital’s absolute value is only preserved if it grows sufficiently:* an ever-greater proportion of surplus value has to be dedicated to accumulation, meaning the consumption funds for both the capitalist and the worker eventually begins to decline absolutely, provoking capitalists to ramp up attacks on both their competition and the working class. The outlay on wages has to be slashed; workers are replaced by automation to replace productivity (and robots don’t even need sick pay etc.).

In such circumstances, the Canutes who do not fight for socialism can only fight for fascism, slavery and world (probably nuclear) war (since the accumulation crisis is forcing nation-states into intensified competition, as evidenced by the rising trade wars).

*If the value of capital is 100 and the surplus value available to reproduce that 100 is 75, there is an overaccumulation of capital of 25. By expanding production and deepening the rate of exploitation, capital can be devalued, to say 90, and the amount of surplus value needed to reproduce and expand (valorise — i.e. create enough value) capital raised to 95 so that the overaccumulation is overcome. Any devaluation, however, tends to be offset by absolute growth (whereas each unit is devalued); and in the long run the growth of capital value tends to outstrip the growth of surplus value production as the pool of exploitable labour shrinks relative to the growth of capital/machinery. Devaluation postpones the tendency for accumulation to breakdown on the one hand but on the other decreases the amount of labour time contained in each commodity. (See Henryk Grossman, The Law of Accumulation and the Breakdown of the Capitalist System.)

➤ Another way of looking at the situation in historical terms: just as the number of slaves in the US declined as a percentage of the population (from approx. 25% in 1790 to 16% in 1860) before slavery ended (via civil war); manufacturing workers have declined as a percentage of the US workforce from 26.4% in 1970 to 8% in 2018.

(The decline of slavery relative to waged labour, along with its exhaustion of the soil through extensive farming, compelled the slave-owning South to expand and export slavery, compelling the North to fight back to maintain capitalist production. As the civil war progressed, it became clear that abolishing slavery throughout the US was the only way to save the Union and US agriculture. More generally, slavery was unenforcable in urban and factory settings — and the limits of man meant he had to be supplemented by mechanical machines, to raise productivity — necessitating the transition to waged labour.)

➤ The means of production evolve and improve ‘organically’ in order to meet the demands of capital accumulation — although innovation and the tendency for machinery to grow relative to labour is also historical; both continue under any system due to man’s eternal inherent quest for labour-saving and life-enhancing innovations — but eventually demand new relations of ownership. Just as slavery and feudalism became increasingly inefficient forms of production that not only prevented countries from becoming richer but made the bulk of their populations increasingly poorer, the same is now true of capitalism and the private ownership of the means of production (which already produce socially in terms of the means of consumption).

The commodity, the basis of capitalist society, is dually characterised by exchange value and use value (utility), but the evolving deindustrialisation, servicisation, automation and digitalisation of labour has evolved a new economic-technical basis to society whereby exchange value is withering away, leaving one that demands a new political-legal superstructure based solely on use value; i.e., the public/social/human ownership of all production and services; centrally planned, break-even utility production; and the replacement of money by a (non-transferable) voucher system pegged to labour time.

Put another way: the economic-technical basis to the social formation known as capitalism is a value composition (constant capital:variable capital, or c:v (the value of the means of production: the value of the outlay on labour power/wages)); and a technical labour composition (means of production:living labour, or MP:L). Constant (dead) capital is withering away due to the dwindling size of and now exponentially rising productivity/capacity of variable (living) labour.

So whereas captialism has long been a dualistic, mechanised system of production, it is evolving into a singular, automated system of production — socialism.

In socialism, the technical labour process is no longer slowed down (by recessions) or conditioned by the valorisation process.

The problem for capitalism is that it eventually runs out of labour and labour time to exploit; use values to commodify; and industry, land and services to privatise and atomise.

(Re. atomisation: splitting one area or thing into two enables you to charge for it twice: so splitting the road up into millions of cars instead of far more efficient trams or trains etc. is far more profitable; making and selling billions of individually-owned screens is far more profitable than encouraging the use of communal cinema screens, and so on. This is not to say that socialism will ban individually-owned cars and screens — just that they could be used a lot less (as well as made more cleanly and sustainably) with more efficient and socially rewarding alternatives).

➤ A fully automated system of production — including the microbiolisation of production of food and fibrous (plant-based) structures that will make the labour intensity of farming and mining obsolete —will involve so little human labour per unit produced that there will be nowhere near enough surplus labour time for capital to exploit (to reproduce and expand itself). So the capitalist system will break down absolutely before production has been fully automated.

What makes socialism the economic solution?

➤ Since the private sector is increasingly monopolised and dependent on long-term central planning (eliminated internal markets, budgets, forecasts, stock coding, etc.) and state (public) subsidies (including tax cuts) — trending towards 100% of income and therefore nationalisation — taking the means of production under public ownership, a ‘final merger’, and centrally planning the economy as a whole, is becoming, for the first time, an economic necessity.

Corporate tax cuts are a form of subsidy, indicating that the private sector is increasingly dependent on the state for its income

➤ Since the private sector is losing its ability to employ value-creating (commodity-producing) labour — it does so only if profitable — society, via the state and state enterprises, must take over responsibility for employment, enabling actual full formal employment.

➤ Since the workforce is now almost entirely services-based, economic stability can only be established by an applicable system, whereby value is created not by for-profit commodity-production but by break-even utility-production.

➤ Since fiat currency is dying a natural death, with cash also disappearing in relative terms — not due to any conspiracy as such but because: only so much cash can be stored physically; accumulation demands increasing efficiency in circulation and turnover; and cash must be converted into bonds to lower interest rates — it must be replaced by a non-transferable digital voucher system, with the ‘currency’ pegged to labour time.

Workers will therefore receive all the value they create during the working day (instead of having part of it appropriated by capitalists), paid in units of labour time worked, minus taxes for universal public services, defence (while needed) and so on. A grading system will probably be needed to incentivise types of work (night shifts, for example) and productivity rates. Combined with public ownership and full employment, this system will institutionalise equality of labour (the right to receive all the value you create), underpinning equal rights (whereas rights under capitalism only really exist if you have money) and limiting economic inequality to a minimum; while consistently raising living standards for all (especially via general falling prices).

And since digital vouchers will be non-transferable, cancelled like train tickets once ‘spent’ on consumer goods, the centralisation of wealth into the hands of a few becomes impossible.

Capitalism (left) vs socialism

➤ In the long run, as full automation, 3D-printing, lab-grown food, etc. become increasingly diffuse and localised, the divide between producer and consumer will increasingly disappear, bringing about economic independence and abundant (extremely plentiful) material wealth for all, meaning class and the state will become increasingly irrelevant — and both will therefore wither away. In this way, whereas capitalism has a long-term tendency to centralise wealth and power, socialism has a long-term tendency to decentralise wealth and power.

Essentially, socialism completes what capitalism started but could not finish.

➤ Precision fermentation and 3D-printing are forms of additive manufacturing, as opposed to until now subtractive manufacturing — metal or trees subtracted from mines or land, for example. So:

Subtractive and mechanised production = limited/scarce production (capitalism)

Additive and automated production = unlimited/abundant production (communism)

Why not skip straight to ‘full’ communism/anarchism? How does a state with its monopoly on violence hope to abolsih sexism, racism, etc.

Socialism is the lower stage of communism, a transitional period between the higher stage of capitalism (monopoly capitalism, which started emerging nationally in England in the 17th century — inevitably out of lower ‘free market’ capitalism — and on an increasingly internationalised basis in the late 18th century onwards) and the ‘higher stage’ of communism, when the state has withered away. Cementing the abolition of the all-capitalist state requires the establishment of an all-socialist state, which must be able to defend itself from both internal and external counter-revolution.

Furthermore, the socialised digital voucher system that needs to be introduced is inherently centralised. Digital non-fungible tokens, essentially the same thing, are already being introduced (to lower interest rates below zero, as they can’t be withdrawn physically) by what we call state monopoly capitalism, the very late phase of capitalism we have now entered whereby the largest monopoly corporations have all but totally fused with the capitalist state (reliant on state subsidies, facilities and contracts).

State monopoly capitalism is one evolution (yet revolutionary) step from what we could call state monopoly socialism (since it is the final evolutionary step at the end of a long series of evolutionary ones).

Remote or poor regions, both domestically and internationally, may not have all the resources they need to eliminate poverty or build up their productive forces, also necessitating distribution through central planning, both nationally and internationally. Central planning also prevents (non-fraternal) competition between co-operatives and communes.

Anarchists understandably want freedom from any state, since any state is capable of imposing ‘bad’ or (say, for example, culturally) regressive policies. But so is any democratic institution or collective. You can call the state, the central body that runs a nation, something else if you like, but it still has the same function. Central planning is not about a central committee of bureaucrats making all the decisions — it is akin to a brain relaying information and resources between organs and the central nervous system that interconnects them. Capitalist enterprises already employ much auto-planning in real-time.

Enforcing anarchist ideals can often play out badly if the existing circumstances are not ideal — i.e. a smaller demographic cannot by definition successfully impose its will on a bigger demographic (the capitalist class only does so through bribery, blackmail and military force).

Socialism is not defined by ‘good’ or ‘bad’ policies but by the socialist mode of production and the all-socialist character of the state. The working class is not monolithic — nor any section of it — and the majority of a given country’s population may at one time or another vote for ‘bad’ policies, largely depending on the size of various demographics. Each socialist country will vote differently on different issues, influenced by their cultural pasts, existing circumstances and level of development.

But because socialism is driven by utility production based on needs, wants and ongoing technological evolution, rather than commodity production based primarily on exploitation and private profit — and removes the productivity fetter of surplus capital — socialism is a higher mode of production than capitalism that abolishes unemployment and economic crises, enabling consistently higher productivity. Socialism will therefore progressively and consistently improve material conditions generally along with every individual’s economic independence, thereby enabling ongoing social and cultural progress; especially since, in the long run, the demographics of populations will continue to change — over a number of generations — i.e. continue the integration and equalisation of race, nationality and gender that began in earnest (i.e. most noticeably) in higher capitalism over the past century (an intensification of a much longer-term trend given that there used to be six types of human and there are now only one).

(NB: Atomised production produces an atomisation of the species physically yet, due to the relative lack of technological capacity, a relatively uniform ‘presentation’ in terms of fashion, sexuality, etc. As technology evolves and becomes more efficient; as the productive forces become more integrated, automated and abundant, capacity and consumption rises, and so the evolution of the human species becomes more integrated and assimilated physically, yet its presentation becomes more diverse. Each generation therefore tends to be more physically assimilated and ‘socially liberal’ than the last.

The tendency towards the equalisation of genders and races really took off with the post-world war II productivity boom that enabled much higher consumption of a much higher technological quality and capacity, as wartime inventions were commercialised. Capital’s continual need to cheapen and expand the labour supply meant more and more women, for example, started to gain a higher degree of economic independence, giving reformist feminist movements and other women’s struggles more economic power and confidence. Rising relative living costs after the privatisation of social housing (which enabled the well off to buy up more and more housing, thereby reducing the supply relative to demand, driving up prices) generally demanded ‘two bread winners’ per household. That and capital’s ongoing need to expand and speed up (i.e. internationalise) the circulation of capital, has meant women etc. have made up an increasingly large part of the labour market, including management roles, creating the basis for rising social liberalism and the relative decline of social conservatism.

Race and gender (‘norms’) (along with states and war) did not exist as hard categories before private property (around 12,000–14,000 years ago). Living in primitive communal arrangements, adults had shared marriages and so paternity could not be determined, meaning that the male and female sexes (not the same as gender) were social equals. When the agricultural revolution brought about surplus produce and therefore birthed trade and private production, the female sex was relegated to the position of producing children to work the land and paternity had to be determined so that property could be passed on to an heir, necessitating monogamy (and the enforced fidelity of women).

Indeed, numerous studies show that women — and all genders and sexualities, in fact — enjoyed much better sex lives in socialist East Germany compared to West Germany, since rising individual economic independence meant sex became something to share rather than a commodity or something traded for security.

Rising trends in polyamorous and ‘non-binary’ ‘identities’ are therefore historically inevitable post-industrial, pre-socialist trends.)

Socialism, the lower phase of communism, completes the historical trend towards fully automated production, bringing about the higher stage of communism and sustainabale abundant material wealth for all.

No one can promise ultraleft fantasies to immediately abolish religion, race, gender, prisons, the nation-state, etc. Certainly the change in the class and economic character of the state, new institutions and (ongoing) repurposing reforms will transform the nature of the state considerably; but the state, etc., have to be made increasingly irrelevant — by significantly improving living standards, sustainably, both nation-wide and internationallybefore most people will agree that they should be officially abolished or completely transformed. (Indeed, religion already tends to be most irrelevant where living standards are highest.) The more localised, communised and abundant production becomes, the more ‘the centrality of the state’ and the state itself will disappear.

Because ultraleft demands are too abstract, too far off from realisation, communist parties need to propose a focused programme that appeals to the immediate needs of the masses if they are to have a bigger pull than fascism. My view is that revolutionary communist parties should advocate:

➤ Full, formal employment, including large earn-as-you learn trainee schemes

➤ A reduced working week and retirement age (including good, guaranteed pensions)

➤ A green industrial revolution that is actually green (see below)

➤ A long-term programme to build highly accessible public transport in every region

➤ A digital voucher system and flat rate income tax (a percentage of value created, initially worked out by planners or even algorithms; so 40% would be 0.40 of every 1.0 labour credit) to cover state expenditure, including universally available education, health, social and child care, free at the point of access. (Income tax will likely have to be high to start with to pay, through long-term debt, for compensation for expropriations of private companies — which will make the transition much more peaceful than if compensation is not paid — but it will fall in real terms the more productivity rises.)

➤ The cancellation of all private debt and mortgages (i.e. the expropriation of houses from private banks, which are going to go bankrupt anyway). This means converting private housing property into personal property (like a car). The land will be rented from the state, set as a small proportion of income and/or according to differential convenience or amenity of land. The state will gradually buy large properties that private owners no longer require for a fair price. Compensation will also be paid to anyone required to move for environmental or infrastructural reasons; and/or they will be provided with quality new housing, as locally as possible (unless they wish to move further afield).

➤ Empty, unowned properties will be immediately converted into homes for the homeless, followed by nationwide programmes for quality, spacious, community-friendly and carbon-negative/eco-friendly house-building.

➤ If enough land owners go bust, all the land could be immediately nationalised and turned into state-run farms, etc.; if not, it is vital not to drive small farmers into a powerful alliance with large land owners; huge tax breaks for the former should be offset by a high land tax for the latter. State run farms will incentivise farmers to continue running the same farms as before so as to prevent risking collapses in productivity (and incentivise them to train new farmers).

➤ A democratically agreed new constitution in every country— involving all the people and implemented with their consent — enshrining the rights to democratic participation (in most areas of policy-making as well as elections), equality, free speech, privacy, housing, work, education, health, social and child care in a people’s democratic socialist republic.

This sounds a lot different to the ‘socialism’ advocated by Corbyn and Sanders, et al?

Corbyn and Sanders are social democrats, not socialists, representing a privileged layer of the working class, a ‘labour aristocracy’. (Even many parties that use the word ‘communist’ in their name are actually social democratic.) They advocate a moderate redistribution of wealth, but this would not solve the problem of value-creation and would in fact deepen the capitalist crisis, since private capital would be denied subsidies that would instead go to the public. (This does not mean that communists oppose redistributions of wealth to workers or other genuinely progressive reforms under capitalism.) Neither do they offer popular sovereignty for the people.

Their projects are also based on the expanded extraction-based plunder of the neo-colonies of Ireland, Africa, Latin America and Asia, which is not only morally reprehensible but potentially suicidal for all humanity with regards to the apparant climate crisis (see below).

What about the Soviet Union? Socialism didn’t work?

Having inherited a fairly undeveloped/unindustrialised peasant-based economy decimated by WWI and then a counter-revolutionary civil war — aided by 13 western countries that invaded immediately after the Bolsheviks took power — the Soviet Union faced many extreme problems, including widespread illiteracy, relative cultural/social conservatism and better-off peasants who hoarded grain. Sometimes the leadership pushed too hard for progress (overshooting capacity) and sometimes too softly (emboldening counter-revolutionaries).

But overall, there were many phenomenal successes, including the abolition of illiteracy and (outside of war time) unemployment and economic recession, not to mention the stunning lead the Soviet Union initially took in the space race. Far from ‘killing tens of millions’ of people, as claimed by counter-revolutionary revisionists (who include Nazis and people killed by Nazis in their figures and ignore the anyway much higher number of victims of capitalism) the quality of life and therefore life expectancy rose dramatically. Furthermore, it was the Russian Bolshevik/Communist Party that ended both WWI and WWII. Socialism saved millions of lives.

But the constant aggression the Soviet Union faced from western capitalist powers — which increasingly needed to exploit the Soviet Union’s labour — forced it to spend heavily on defence at the expense of its civilian economy (although military spending was done much more efficiently than anywhere else) and again decimated its party cadre, population and infrastructure during WWII.

The situation combined with the relative scarcity that arose from this was bound to bring about a centralisation of power to a greater degree than desired and at times also manifested in what would usually be considered regressive social policy (such as restrictions on abortions due to war-time depopulation and contraception imports shortages; although the benefits of working mothers were expanded, including extended maternity leave, lighter workloads with no reduction of income, and free child care).

That the Soviet Union, where it could circumvent sanctions, had to import various goods and raw materials from capitalist countries also meant it could never fully plan its economy, since it could not predict volatile foreign prices. For the same reason, nor could money be abolished, which also meant there was some logic to allowing a black market to flourish, in order to build up foreign currency (upon which the soviet camp eventually became too dependent, allowing the US to shock the soviet system externally through currency manipulation).

The fear of invasion combined with the (sometimes self-inflicted) denial of some technologies — and the historical stage of technological development in general, which manifested in the domination of ‘command and control’ style planning that overlooked the finer details — held back the Soviet Union’s ability to transition to the higher stage of communism, resulting in relative economic stagnation and a growing pressure in the direction of capitalist reform, especially from skilled workers and intellectuals who benefited from the black market and wanted higher incomes. This latter problem understandably convinces many people that socialism cannot work because of ‘human nature’/greed, but as capitalism is now abolishing itself for good such a problem will soon no longer exist.

Now that computing power is exponentially faster and a digital currency is viable, the problems formally associated with planning can be much more easily overcome. Stock control coding means the finer details can be planned, and production is increasingly integrated anyway.

Once the whole world is socialist, with capitalist competition abolished, world peace will reign, ending the need for defence spending. Furthermore, trade will be actually free, since under a socialist union of nations, no exchange of ownership takes place.

Cuba, the world’s most sustainably developing nation and with a world-class health care system, continues to show that socialism works, even in the face of the US economic blockade, which has cost the island nation more than a trillion dollars (although, it must be admitted, that Cuba has begun to privatise not insignificantly around the edges of its economy, in order to be able to trade and survive the blockade).

As outlined above, world socialism is becoming an economic necessity for the first time, and has therefore arguably not been possible before now (just as capitalism was not possible before certain types of production and industry had developed within feudalism). The Soviet Union, if we are honest, probably did emerge prematurely in historical-technological terms, making its survival incredibly difficult to sustain in a world still dominated by capitalism.

How can socialism overcome the environmental and climate crises if it promises even greater levels of production? Don’t we need less economic growth?

Since value-creation under capitalism is ever-more dependent on the exploitation of labour and expansion of commodities made and sold, growth under capitalism is increasingly dependent on the intensity of deforestation, intensive farming (which tends to exhaust the soil) and mining fossil fuels and metals that pollute the air, environment — and the products we consume.

Under socialism, exchange-value is created and measured according to labour’s usefulness, its utility, instead of its exploitability/profitability, meaning all labour becomes formal and productive of value, not just commodity production. (Indeed, under socialism commodities are no longer commodities, simply goods/utilities.)

USSR pin awarded to farmers for “Mastery of Cannabis Breeding”

Because the labour intensity of mining and deforestation will no longer be absolutely necessary to create new value, this will therefore enable a transition from extractive production to, for example, hemp-based production, a green industrial revolution that is actually green. Hemp is the most prolific and versatile crop on Earth, but it has been prohibited because it threatened the more profitable extractive industries; i.e., because farming and processing hemp is not very labour intensive, and therefore relatively unprofitable. It is only now that the extractive industries are becoming so capital-intensive and unprofitable that hemp and cannabis production, being cheap, are starting to be re-legalised.

(Shell says that its oil production peaked in 2019 and is now in terminal decline, with solar expected to be cheaper for consumers some time this decade. McKinsey estimates that Saudi Arabia’s $900bn fossil fuel industry assets will be worth $2 trillion in debts by 2030.)

Hemp can be turned into over 50,000 applications, including relatively clean biofuel; biodegradable bioplastic that can be made stronger than steel yet lighter than carbon fibre; paper at higher rates and quality than from trees, allowing reforestation; and computer chips and batteries that outperform graphene and lithium, seriously reducing the need for metal mining. Hemp grows quickly with little water, is drought resistant, heals the soil, and rapidly draws down carbon. It also sequesters that carbon indefinitely in the products it is turned into, including highly insular buildings made out of hempcrete that are carbon-negative.

A hemp-based industrial revolution would solve the plastic crisis without imposing some kind of indefinite and unenforcable asceticism on people.

This of course is only one solution. Banana peel can be made into sodium-ion batteries, for example. Scientists at MIT, meanwhile, have made solar panels from plants and grass.

Similarly to hemp, mycelium (a type of fungus) can be coaxed, using temperature, CO2, humidity and airflow, to rapidly build fibrous structures for things such as “packaging, clothing, food and construction — everything from leather to plant-based steak to scaffolding for growing organs” and even computers; all with minimal (mostly compostable) waste and energy consumption.

Technologies like cellular agriculture and precision fermentation may also accelerate our capacity to produce plant fibres, perhaps exponentially, with plant-based fibrous structures therefore making metal and fossil fuel mining increasingly obsolete.

There is also the potential for micro-organisms to supply a near-infinite source of energy in other forms. In 2018, scientists in the US confirmed a theory first proposed by Soviet geologists when they found huge populations of bacteria living in the extreme temperatures of Earth’s crust, despite the lack of photosynthesis and nutrients, living solely from chemical reactions fuelled by geothermal activity. They estimated that up to 23 billion tonnes of micro-organisms live in this “deep biosphere”, making it the largest ecosystem on the planet and accounting for nearly 400 times the amount of carbon found in all living humans. Here lies a potential source of infinite, abundant energy (although we will have to assess whether the benefits outweigh the impacts of drilling).

Other scientists have even found that the Geobacter bacteria found in human waste can convert sewage into fresh water and produce electricity in the process. It is now thought that one day microbial fuel cells could power our phones, household appliances — and even spaceships.

Investment in hemp, mycelium and microbial fuel cells will remain seriously limited, however, until value-creation is based solely on utility instead of exploitation and profit, since capital cannot exploit the labour time of plants and microbes!

Emissions-free, energy-dense nuclear power, now apparantly one of the safest and cleanest forms of energy production is also an option, although the impacts of the initial mining will again have to be carefully assessed. Increasingly unprofitable for monopoly capital, nuclear could be re-embraced to supply the abundant energy the masses need for cheap energy consumption (especially considering the rising demand for air conditioners in a warming world).

Hydroponics, permaculture and ‘carb-fixing’ (turning carbon emissions into basalt rock) are among the other practices that socialist states of the future should probably scale up. Meat, fish, leather and jewellery that are lab-grown on a mass scale will also smooth over the transition of decarbonising production and resocialising and reviving the land, while massively reducing emissions. Much production, as devices continue to shrink, may even be moved almost entirely underground, enabling all kinds of opportunities for revitalising the ‘overground’ environment.

There may need to be hard limits on using pollutants and fossil fuels during this transition, meaning we may have to make only what is absolutely necessary at first (rather than focusing on prohibiting consumption that is difficult and costly to enforce).

All this will also help to detoxify the products we consume that presently increasingly diminish human immunity and fertility.

Consumption should also be made more efficient by incentivising, through tax breaks and rent reductions (as well as the high quality on offer), a transition to communal or at least community-friendly ways of living (that embrace individuality and privacy), thereby pooling resources.

Source: WeatherQuestions.com

While the climate should be monitored seriously, we cannot rule out the possibility that the monopoly capitalist class is now at least exagerrating the immediacy of the crisis in order to promote ascetism (to justify slashing wages) and the privatisation/enclosure of land to expand rents that centralise capital into fewer hands. Various departments are also always after more funding. We are only ever shown temperatures from the past 250 years, whereas looking further back seems to show that we have experienced similar periods of global heating in the past. The rate of warming, however, does seem to be faster than in the past.

All forms of scientific consensus will need to be reassessed once science is liberated from the profit motive.

Clearly, though, even if the climate crisis is not as serious as advertised, world socialism is needed to address the very real problems of desertification, biodiversity loss, and the plastic and pollution crises — and the same goes for if it is.

For further questions and answers, see part 2:

What about one-party dictatorship, censorship and free speech?

What is communist ideology?

What is the communist attitude towards religion and patriotism?

Were the Nazis socialist?

Is China socialist?

What is the communist position towards vaccine mandates, lockdowns and vaccine passports?

How can the masses be convinced to fight for socialism? Won’t revolutions be extremely violent?

So a world war is a real threat, a really increasingly likely possibility?





Ted Reese is author of The End of Capitalism: The Thought of Henryk Grossman; and Abundant Material Wealth For All patreon.com/grossmanite