Background

These notes (published here in a slightly updated form) were originally prepared in response to the document "Money.pdf" written by DL for the February 2020 meeting of the Merseyside Socialist Theory Study Group.⁽¹⁾

DL's notes are around the question of money as it exists currently and comparing it with the presentation of the subject in the The Ragged Trousered Philanthropists. The book is a semi-autobiographical "socialist classic" first published in 1914, three years after the death of its author, Robert Tressell.⁽²⁾

In the course of the book, Tressell outlines the life conditions of a group of workers and their families. The central group of characters are employed by a capitalist (and his notional "company") in various capacities around painting, decorating and other aspects of building maintenance/improvement. The book is set in the fictional town of Mugsborough, based on Hastings where the author lived and worked for the last period of his life. It presents a vivid description of the hardships faced by the working class and the author presents a cogent argument that the alternative is the replacement of capitalism by socialism – a "Co-operative Commonwealth".

The argument for socialism is directed to the readers mainly via the case put forward by the two foremost socialists in the work group, Frank Owen and George Barrington.

Owen, Barrington and the continuing "Great Money Trick"

During the novel, Owen at three points (Chapters 15, 21 and 25) develops the case for "money being the cause of poverty". It is clear in these expositions that Tressell/Owen is explaining that the use of money is central to the capitalist system through its key function in both commodity production and the wages system. Only after these theoretical building blocks have been explained is Socialism presented as a systemic alternative in Chapter 45, "The Great Oration" – an ironically, declamatory form of language and humour that pervades the book.

As DL points out, Barrington rather than Owen presents the full socialist case. This happens soon after Barrington "comes out" as a Socialist after a local capitalist taunts and derides the Socialists at the summer "beano" – a works outing. Fortunately, it is beyond our current remit to muse on any significance that it is not Owen, a skilled artisan, but Barrington, by birth a (petty?) bourgeois, who Tressell allows to deliver the "Great Oration".

DL, in his notes, quotes from Chapters 25 and 45, but it might also be helpful to further follow the thread of the arguments as they develop.

In common with the presentations made in the later chapters, the first (in Chapter 15) takes place during the workers' lunch break.

Owen presents arguments based on a drawing containing two squares, one larger than the other. The larger square represents the large majority of the population in Britain, those who "work for their living: and in return for their labour they receive money: some more, some less than others".

At this point Owen’s argument focuses on the ownership of land and resources rather than the means of production. "... the majority must pay rent to the few for the privilege of being permitted to live in the land of their birth" and "[the minority] have monopolised everything that it is possible to monopolise. They have got the whole earth, the minerals in the earth and the streams that water the earth".

He also talks about the nature and effect of competition between capitalists, a theme which directly affects the conditions of the workers Owen is addressing: "the successful tenderer has usually cut the price so fine that to make it pay he has to scamp the work, pay low wages, and drive and sweat the men [sic] whom he employs ... The result is a job which – if it were done properly – would employ say twenty men for two months, is rushed and scamped in half that time with half that number of men".

Having used the time allowed, Owen points to his wider argument which will be returned to in the later chapters. "Landlordism and Competing Employers are ... only a small part of the system which produces luxury, refinement and culture for a few, and condemns the majority to a lifelong struggle with adversity, and many thousands to degradation, hunger and rags". He had already presented a similar précis earlier, "The majority work hard and live in poverty in order that the minority may live in luxury without working at all".

Those arguments remain valid today. The continuing relevance of the novel is underpinned by the further explanations, in which money is far more central, that are made subsequently. The presentations explain that money is intrinsically connected to the proletariat's condition as a class of wage slaves. It is that relationship between classes which remains unaltered today – the role of money in underpinning the rot and degradation of the capitalist system remains as true in 2020, more than a century after the novel was written.

From the "Great Money Trick" to the "Great Oration"

Owen, in Chapter 21, entertains and attempts to educate his fellow workers by demystifying the wages system. Involving his colleagues in an exercise where pieces of bread are the commodified products of production and a few low value copper coins are money he exposes its true nature as a device whereby the capitalist class extracts surplus value from the working class. For the purposes of his presentation, Owen entitles this exploitation as the "Great Money Trick".

During a later lunch break Owen explains, in Chapter 25, the nature of poverty by clarifying the unequal access to "the benefits of civilisation and necessaries of life". This is illustrated by an oblong showing the unequal distribution of all that is produced between different layers of society.

Those who enjoy the vast majority of these products are drawn in two fifths of the oblong. The content of both is entertainingly quirkish. The first includes "Tramps, Beggars, Society People, The 'Aristocracy', Great Landowners, All those possessed of hereditary Wealth." The second collection of parasites are "Exploiters of Labour, Thieves, Swindlers, Pickpockets, Burglars, Bishops, Financiers, Capitalists, Shareholders, 'Ministers' of Religion".

A far smaller amount of the total product is available to the much bigger number of people that Marxists would recognise as proletarian. Owen splits these into three categories – "All those engaged in unnecessary work, All those engaged in necessary work – the production of the benefits of civilisation and, thirdly, [the] Unemployed." As an aside Owen explains to the other workers the relationship between those three categories. In particular, the difference between necessary and unnecessary work remains a useful popular introduction.

Of course, Owen's presentation is not merely sociological. He revisits and reinforces his earlier explanation: "The total value of the wealth in this country during the last year was £1,800,000,000, and the total amount paid in wages during the same period was £600,000,000. In other words, by means of the Money Trick, the workers were robbed of two-thirds of the value of their labour."

During Owen's presentations he receives regular retorts from the workers who side with the various then existing "parties of the bourgeoisie" (Liberal, Tory) or often simultaneously with religion-inspired obfuscation. There is a repeated barb that Owen has not explained how the existing order can be replaced.

Barrington responds to this objection in his "Great Oration" (Chapter 45). The Oration is a rich vision of a post-capitalist future. A century later, it is clear that the presentation is of "of its time" advocating a socialist economy based on a state-run National Service brought into existence by "Revolutionary Socialists" in Parliament. Such formulations for the "Co-operative Commonwealth" are totally unsurprising as very few had grasped the significance of the Workers' Councils that had appeared during the 1905 Russian Revolution. Neither Tressell nor his readers had yet lived through the full blown horrors of capitalism's imperialist phase. Although Barrington makes reference to increasing militarism he could not anticipate the bloodshed and misery of the First World War or the nature of the proletarian revolutionary wave that ended it and briefly challenged the capitalist world.

Regarding money, the key message is teased out during the discussions with the other workers. Barrington has described the increasing domination of a state administered paper currency over the capitalist precious metal-based coinage. Although, Barrington continues to refer to the paper currency as "money" he has to explain that in fact, money would be negated. Very succinctly he outlines – "... no one will be able to hoard up or accumulate the paper money because it will be dated, and will become worthless if it is not spent within a certain time after its issue". That argument clearly defines that money, as it has existed during class society, will have no place in the future co-operative world. Indeed, Barrington's description appears to refer to the concept of "labour time vouchers". Such “vouchers” or “certificates” were seen by Marx as a potential way to undermine the law of value⁽³⁾ in the early stages of communist society “just as it emerges from capitalist society”, as a stop gap measure until global free distribution according to need becomes reality:

...the individual producer receives back from society – after the deductions have been made – exactly what he [sic] gives to it. What he has given to it is his individual quantum of labour. For example, the social working day consists of the sum of the individual hours of work; the individual labour time of the individual producer is the part of the social working day contributed by him, his share in it. He receives a certificate from society that he has furnished such-and-such an amount of labour (after deducting his labour for the common funds); and with this certificate, he draws from the social stock of means of consumption as much as the same amount of labour cost. The same amount of labour which he has given to society in one form, he receives back in another.

Karl Marx, Critique of the Gotha Programme

In the case of socialised production the money-capital is eliminated. Society distributes labour-power and means of production to the different branches of production. The producers may, for all it matters, receive paper vouchers entitling them to withdraw from the social supplies of consumer goods a quantity corresponding to their labour-time. These vouchers are not money. They do not circulate.

Karl Marx, Capital Volume II

A Century After Tressell

The Study Group discussion was focussed on "Modern Monetary Theory", which has gained some popularity among leftist economists attempting to reform a capitalism that finds itself in a global financial fiasco whereby a credit/debt bubble has grown exponentially, now amounting to more than $250 trillion in global debt.⁽⁴⁾

This situation has developed alongside half a century of unresolved capitalist crisis, the first key signal being the collapse of the post-war financial system based on the Bretton Woods agreement. As DL summarised, that system was based on the US Dollar being "as good as gold".

In the period since then the world capitalist system has struggled in an increasing "dog eat dog" scenario while all states, each intertwined with their "own" capitalist institutions, have attempted to defend their national interests and profitability.

The crisis of 2007-8 saw a response based on states taking over huge amounts of debt and subsequently accelerating the growth of the financial bubble to today's absurd proportions. Global market indices are currently seeing their worst week since the financial crisis of 2007-8.

Irrespective of the Alice in Wonderland financial casino based on speculation and "financial instruments" the essential reality for the working class continues to revolve around the global system where our conditions of existence are based on the sale of our labour power. After 100 years of us failing to achieve the "Co-operative Commonwealth" the bourgeoisie continue to dominate workers' lives with their "Great Money Trick". Just as Tressell and his characters foresaw, there remains a desperate need for the revolutionary reconstitution of society, eliminating the wages system and producing for use rather than profit, whereby money and all the other filth created by class society will be swept aside in favour of a sustainable human future.

KIT

February 2020

(1) The Socialist Theory Study Group is a monthly discussion forum in Liverpool in which comrades of the CWO have regularly participated since last year. The current programme alternates between the study of Marx’s Capital and chosen topics of interest from a Marxist perspective. Contact info: study4socialism[at]outlook.com

(2) Robert Tressell (1870-1911) was an Irish painter and decorator. Often unemployed, he turned to writing. Under the influence of William Morris he joined the Social Democratic Federation in 1906. Two Marxist organisations would emerge out of the SDF, the Socialist Labour Party (1903) and the British Socialist Party (1911). Tressell died of tuberculosis in 1911, Liverpool, where he was buried in a pauper's grave.

(3) For discussion on the period of transition to socialism, see leftcom.org (note: these documents do not represent the final positions of the ICT)

(4) cnbc.com