In this new 'Left Focus' article former Australian Communist leader Eric Aarons provides an analysis based on Thomas Piketty's influential new book 'Capital in the Twenty-First Century'. In particular Aarons defends Piketty's notion of a 'Social State' as a project for progressives in today's world.
by Eric Aarons
In his fine and
successful book, Capital in the
Twenty-First Century, Thomas
Piketty uses the
term ‘the Social State’ to describe a form of government that controls the capitalism of our day
sufficiently to ensure that every citizen gets an adequate mix in quantity, quality and kind of the goods and services necessary to live a
civilized life in today’s conditions.
This was never
achieved in the socialism of the 20th century by those who tried the
hardest – the Russians, then the Chinese, Vietnamese and Yugoslavs. Nor were
their political formations suited to winning lasting popular support.
But that period
witnessed the two biggest and worst wars ever.
The first, ‘The
Great War’ against Germany, is presently being ‘celebrated’ for its hundredth
anniversary (because We won it)
though a major feature of it was a struggle to possess the most colonies with
the most people and resources.
The Second World
War, fought against German and Japanese fascism, which was an extremely
reactionary ideology based on grounds of racial superiority and revenge, which
could not be permitted to succeed.
I was born in
1919, so did not see any of the first war, though I was moved in observing some
of the human wreckage that came through it. Then I saw and felt the Great
Depression that followed it for a decade. By the time the second broke out I
was politically aware, and on the basis of the facts then prevailing, thought that socialism was the only possible
I could literally
‘feel’ the sentiment around me then.
It was: that we will fight to the end against German and Japanese fascism; but
‘never again’ will we put up with the sacrifices of wars, in which capitalists
always do well, but make few, if any,
changes for the better.
I am sure that
pro-capitalist forces knew quite well that they were then very much on the
defensive and had to suitably respond. The same note was struck by the
extensive postwar planning agenda which included plans for doing away with the
dilapidated and bug-ridden city shacks in which the majority of working people
had to live, while wide-ranging plans were made for the future with the great
Snowy-mountains project and other plans put in place near war’s end.
New thinking was
encouraged, and practiced enthusiastically – not like today, where it is
demanded to get out of the hole capital has dug itself into
All this, and the
influx of refugees from shattered European countries who immediately found
jobs, created the three decades of unprecedented prosperity that followed,
showing what could be done by a socially engaged government that still
respected private property rights, but was prepared to act outside the usual
bounds, to correct or mitigate the faults in the capitalist system and respond
to glaring economic and social needs.
products went into mass production for the first time, such as synthetic
plastics (on a scale in which we are near to burying ourselves). And in 1947
were invented the now truly universally present ‘transistors’ using rare ‘semi-conducting
minerals, and now essential in all our electronic appliances and especially the
It was, in fact, a
practical response to the over-theoretical and rather rambling ideology of the
neo-Liberalism developed by Friedrich Hayek that made valid criticisms of
socialism as practiced, but failed to make a compelling case in favour of
permanent adherence to a capitalism that had in major respects run amok ,with
no alternative yet in sight.
Three decades of prosperity and peace
For three decades
there was virtually full employment; it was easy to leave a job and find
another better one, while profits were also booming. I noticed all this when I returned at the end
my three year study period in China, and was somewhat taken aback by the scale
of spending that was clearly now the norm. The Social State had arrived, though
we didn’t yet have the name for it.
War torn Europe
had to spend some years repairing colossal damage, and couldn’t therefore
immediately take on this initiating task, while the US was more occupied with
Senator Joseph McCarthy’s campaign to drive out of the country all artists,
writers and activists deemed to be ‘leftist’.
So I feel
justified in claiming that the first examples of the Social State appeared in
Australia and New Zealand, and we should now exert ourselves to contribute to
the development and renewal that Piketty prescribes.
today embraces efforts to regulate capitalism’s inherent cycles, irregularities
and periodical crises; and in the financial sector, its increasingly
deliberately illegal activities that have incurred multi-billion dollar fines from an Obama Presidency.
We, in Australia,
though relatively well-placed economically, are faced with a new conservative
government trying to foist on us an austerity regime, while at the same time
giving open slather to environmental damage from our massive coal deposits and
the money-making plans of ruthless so-called ‘developers’.
Capital Fights Back
But capital does
not welcome, or even recognize, the word ‘sufficient’, especially in regard to
profit, which is its lifeblood. It worked away in the ideological field with
attacks on trade unions, cries of ‘nanny’, concerning the new State, ‘living
off the public teat’, ‘not standing on your own two feet’, and the like. Then
came the outbreak of an escalating bout of inflation in the mid-1970’s when,
particularly with his theory of neo-Liberalism and winning the Nobel Prize,
Friedrich Hayek turned the ideological tide which, along with the mantra
‘success is the sure sign of merit’ (literally, where money is concerned, the assertion
that ‘might is right’, worked in favour of a capital on the offensive.
left, with its own concerns from even worse socialist failures and accompanying
fragmentation, was not up to the task of waging the essential ideological struggle
against neo-liberalism. But now, Thomas Piketty, with his new approach and
forcefulness has given the left a second chance. We must not waste it this
This, if properly
and persistently used along with a renewed and refurbished Social State, can
break neo-liberalism’s present ideological hegemony and undermine the present
political dominance of the mega-rich, who dictate in various ways the direction
of society’s (indeed, humanity’s) development.
Certain unusual or misunderstood aspects of
neo-Liberalism have to be grasped if this struggle is to be won. For instance:
describes itself as something that was not, and could not be created by human beings. It is
a self-generated, self-organized combination of elements that, spontaneously
welded themselves into the system that we now call capitalism.
Because of that
supposed ‘fact’, no individual or group of individuals can be blamed for
shortcomings: these are more likely to
be caused by government, union or
leftist interference. This system has evolved,
and we cannot control evolution. Indeed, to try to do so can only make things
worse than they may presently be. And nothing like ‘Social justice’ can exist,
for ‘society’ is not an entity that can be studied or managed as a whole.
outdated old instincts are the main problem, always holding us back. Rather
than inbuilt ‘human instincts’ and ‘fellow-feeling’, we now have to control ourselves by a set of abstract rules.
Hayek proclaims: ‘I believe that an atavistic longing after the life of the
noble savage is the main source of the collectivist tradition.’(The Fatal Conceit, page 19). The one
exception concerns our intimate companions:
Because, ‘if we were always to apply the rules of the extended order
[capitalism] to our more intimate groupings, we would crush them.’ (ibid. page 18).
The rest can go
hang, he is saying; but with the sweetener for some ‘that such a system gives to those
who already have [which is] its merit rather than its defect.’ (Law, Legislation and Liberty, vol. 2,
Hayek has devised
what would be a legally binding constitution to guarantee that it will survive
even the demise of the above supports for the inner nature of the system.
some years, I and others had hoped, rather, to do away with capitalism
altogether. While capitalism was still in full control, it was the social
democrats of various kinds in Australia and worldwide who, to their credit, worked hardest to abolish the sordid slums
where the majority of working men, women, and children were forced to live.
These were replaced with decent habitation, and many of their progeny showed
through their abilities that higher education should no longer be be confined
to the wealthy – a principle now under a new threat from the Abbott government
and its education minister, Christopher Pyne.
intense, ‘post-war reconstruction’ had to heed – and did – modern concerns with
new social problems, complexities and to a degree our relation with nature
itself and other species began to appear. Capitalists and their ideologists
were very much on the defensive, and the
conservative Robert Menzies presented himself as a spokesman for the developing
It was a period
when really full employment existed, and I can remember a time early in Menzies reign when a 2 percent rate of official unemployment
caused anger and concern.
that only democratically elected governments could have the power to obtain the
money now required to solve new tasks, and thereby had both the right and duty
to step in – not to take over the lives of individuals and families, but to
help all citizens cope with the increasing complexity of modern living.
This expressed the
conviction that a civilized society required not only the piecemeal reforms
already set in place, but an undertaking that the state itself would work more
broadly, as in fact it did. This was significantly and particularly in the
three unprecedentedly prosperous decades (a whole generation!) that followed
the victorious end of the Second World War.
occur to me that could make a significant difference, without repeating the
socialist mistake of advancing to foremost requirement the abolition,
essentially by confiscation, of all significant private property in the means
in his important recent book Karl Marx: a
nineteenth-century life, includes from a new edition of Marx’s collected
works, the fact that Marx had some second thoughts about private property.
Reading a copy of
Rousseau’s Social Contract, Marx had
heavily penciled in the margins that ‘a genuine democracy would be the “true
unity of the universal and particular”, where the state would be a “particular
form of the people’s existence.” Sperber then publishes comments holding that
this structure would not be the same as anarchism but the ‘creation of
circumstances in which the state ‘no
longer count[s] as the totality’ that is, was
no longer opposed to the private interests of civil society. (Karl Marx: a nineteenth Century Life,
Taking notice of
Piketty’s view that the Social State, now 60 or more years old, is in need of
renovation and renewal, I believe, with him, that ‘civil society’ needs a
boost. Philosopher John Gray writes of this concept that: ‘this is a complex
structure of practices and institutions, embracing a system of private or
several property, the rule of law, constitutional or traditional limitations on
government authority, and a legal and moral tradition of individualism, which
is the matrix of moral tradition of individualism, which is the matrix of moral
and political life as we know it.’ (Liberalisms:
Essays in political philosophy, page 262).
It is also related to to the concept of
‘self-management’,which I have
personally and positively experienced in a cooperative printery.
The one thing that
I would like to add to any set of changes, is that it be made clear that ‘ownership’ is not absolute, but
includes also the concept of custodianship,
implying that possession includes some responsibility to preserve, where
possible, the value of an asset – and particularly of our wonderful natural assets.
viewing a DVD of
Ken Loach’s film The Spirit of ’45
(the end of the Second World War) I realized that, despite extensive damage,
the British nation and people had not only been moved like everybody else by
the spirit of ‘never again’ without
changes for the better, would they fight for a defective and unfair social
immediately set about ensuring it was actually done. Many of the demands
developed after WW1 by the left, labour, and progressive movements, but
rejected by the dominant rich and aristocratic forces were, dusted off and
refurbished by radical intellectuals and socialists, and actually put in place
by the first post-war government.
a prominent hereditary aristocrat, had played a major part in defeating a
movement to do a deal with Hitler, peopled by some prominent aristocrats,
including some close to the royal family. And, succeeding, when war actually
broke out rose to the top and played a leading part with inspiring speeches
and, mainly good, military and political decisions.
When the first
postwar election was held, he stood as a candidate to lead the new government,
but was defeated by Labour.