MUDDLED 'EXPERT

Nixon lays down his new He made ation Con pag growing capitalist economic crisis for the last few weeks, the revisionist statecapitalist paper Socialist Worker' has at last felt obliged to comment on it. In an article 'US move to export inflation and unemployment, John Palmer seeks to explain the latest convulsions in the world's money centres.

Palmer is the man who, for the past ten years, has been assuring the middle-class circles which his group inhabits that capitalist slump was a thing of the past. Spending by the state on arms had given modern capitalism a more-or-less everlasting stability. Not that there was anything new in such a 'theory'. It was taken over by the Cliff group, usually unacknowledged, from the American Schachtmanite revisionist T. N. Vance, who came to similar conclusions in the early 1950s. This was the group which rejected the defènce of the Soviet Union in 1939 and split from the Trotskyist movement. ir the state capitalists the theory was but a thin disguise for their complete confidence in the permanent existence not of the 'arms economy, but of capitalism. Capitalism was powerful and would go on lasting for a very, very long time was what their politics amounted to. Just as they wrote off and slandered the Soviet working class who had allowed the Russian Revolution to be lost, they said, so they wrote off the working class of the major capitalist countries. ven Palmer's political record as a selltyled 'expert' on 'economic questions' the more perceptive 'Socialist Worker' reader will be somewhat surprised to hear him pronounce: 'For 20 years after World War Il the giant American Devaluation of dollar only the beginning THE TERMS which the American government intends to impose on its capitalist competitors have emerged with stark clarity from President Nixon's statements since the 10 per cent dollar and his lieutenants have clear that the devaluis only the beginning of a programme of measures designed to force both Europe BOOK YOUR TICKET FOR EMPIRE POOL NOW DEFEND ALL DEMOCRATIC RIGHTS Defend trade unionism and basic living standards Unite in action to make this Tory government resign The road to power is through the building of the revolutionary SUNDAY MARCH 11th 3pmPAGEANT•RALLY• CONCERT I would like to take part in the Pageant/ Please send me further details.

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Used economy was able to reconcile full employment, economic growth and relative price stability through massive dependence on production for wastethe permanent arms economy. But this stability could never last.' (Our emphasis.) Imer now has the impudence to tell his readers that the 'permanent arms economy'-on which he and the leadership of his group based their entire rejection of revolutionary Marxism and the fight for a revolutionary party'could never last'. The 'permanent arms economy, we now learn • at this late hour, was not 'permanent' after all! 'en on its own level, Palmer's 'analysis' is the most utter rubbish. In what sense did arms spending constitute 'production for waste'? Here, Palmer only reveals his complete ignorance of Marx's theory of productive and unproductive labour. In analysing productive labour, Marx shows that whether a commodity was 'useful' or not was absolutely beside the point. 'Productive labour' was that labour which, when exchanged directly against capital, produces a surplus value. This was quite independent of what type of article was produced, or whether an article was produced at all.

In this sense, arms production always involves the expenditure of unproducopen their merican goods their ability to Europe and Japan are to be bludgeoned into accepting American goods through the imposition of tariffs and through enforced revaluations which will price their own products out of the world markets.

The US wants to force other YOUNG SOCIALISTS AND SOCIALIST LABOUR LEAGUE APAGEANT OF HISTORY-THE ROAD TO WORKERS POWER EMPIRE POOL. WEMBLEY. SUNDAY MARCH 11 3 P.M trade war laws countries to accept a 'reform' of the monetary system which would make such revaluations automatic as soon as a country moved into surplus on its payments balance.

America is also demanding that the Europeans put an end to their common agricultural policy, which protects European farming by keeping prices inside the Common Market artificially high.

The agricultural system inside the EEC is protected by high tariff walls which have for a number of years prevented American farmers from exporting their surplus produce to Europe.

At present the American government pays farmers not to produce certain categories of foodstuffs, notably grain. But this arrangement, which in effect dovetailed with the EEC farm policy, is to be brought to a very abrupt end.

Investments

To add to these hammer-blows against their competitors, the American employers are about to launch a new era of dollar imperialism, when Nixon removes all the existing barriers to the export of capital from the US.

The Trade Bill now on its way through Congress will empower the government to impose all forms of tariffs against goods from abroad. The Bill could be used to impose a general tariff against imports, as demanded by the powerful House Ways and Means chairman Wilbur Mills.

The Bill also gives the President powers to set discriminatory duties on goods from particular countries, notably Japan, which are considered to be exporting too much to the US.

It will open a new era of tariff war around the world as country after country retaliates not only against the US, but also against goods : being dumped on their markets by other victims of US policy.

Simultaneously Nixon plans tc pulverize his opponents' barriers to US goods. To destroy the common agricultural policy in the EEC, Nixon has authorized farmers to plant an additional tive labour. The finance for such production comes either out of taxes, which are levied on wages and profits, or else it is financed out of budget deficits which in turn have to be met by future taxation. To the extent that arms are financed out of current taxes, this merely eats into the available surplus value and thus slows down the rate - of capital accumulation.

If out of future taxation, by means of a budget deficit, this only adds to inflationary pressures which have now reached explosion point in this crisis. The 'expert' Palmer also reveals that his analysis is a million miles away from the realities of this crisis when he writes: 'A dollar devaluation was forced on the United States in 1971, but it has not produced an improvement in the US payments gap.' ere Palmer manages to stand reality on its head! For the Americans deliberately devalued the dollar as part of their trade war against Europe and Japan. By devaluing, Nixon lowered the price of all US exports at one blow, raised the price of all foreign goods entering the US and at the same time slashed the value of the billions of dollars held by European government and industrial and financial institutions.

40 million crops.

When this grain comes on the market in 1973 it will be available for 'dumping' at far below the present world price. This in turn will force the EEC to raise taxes to punitive levels in order to maintain its farm subsidies.

Nixon has offered the EEC a deal. In return for their dismantling the common agricultural policy, he is prepared to spare them the worst effects of the Trade Bill.

This is a worthless offer, but it is an offer the Common Market will find hard to refuse. Nixon's promise has little value because it will only change slightly the form which the trade war will take in its early stages, not its effects on Europe.

In the unlikely event that Europe is spared the direct effect of surcharges and tariffs on its exports to the US, it will still face the full impact of the Japanese trade offensive which will follow the imposition of tarifis on Japan's exports to America.

In other words there is no way out by negotiation or agreement, but only a ruthless conflict between the main capitalist countries. The final prong of Nixon's attack is in the field of capital exports.

The US employers correctly anticipate that the planned measures will result in wholesale commercial crashes and the liquidation of whole branches of the economy in Europe and Japan.

Discriminate To take full advantage of this situation by buying up bankrupt industries overseas the Nixon administration is planning to remove all the existing controls on investments of US capital abroad.

Not only will this mean a new wave of dollar imperialism as US investors take advantage of bargain-basement prices.

It will also destroy much the remaining financial role London and other Europe: money markets and wipe out considerable slice of Briti 'invisible' earnings at a stroke. cereal is directly in line with the entire politics of the Cliff group. What such a middle-class group positively hates is that capitalism is driven forward through its internal contradictions. Marxism, with which Palmer has not the remotest connection, has always seen these objective contradictions as providing the basis for the struggle for socialism. le root cause of the present crisis is that the productive forces, of which the working class is by far the most powertul, are now set on a violent collision • course with the restriction imposed on their development by capitalist social relations of production. It is for this reason that the working class, led by the revolutionary party, is called upon to put an end to capitalist anarchy. "r Palmer and his middle-class friends, capitalism is merely irrational: 'Socialists will point to last week's money panic as further evidence that capitalism is no longer capable of operating with the minimum of rationality' This is how he ends his pathetic article. ipitalism, Mr Palmer, is in no way behaving 'irrationally'. In a crisis, as a matter of fact, it behaves more rationally than ever. For in such periods its hidden laws of motion break surface and are there for all to see. lis is precisely what the present CrISIS is doing, in a way which Palmer and his group no doubt find most unpleasant. For the last 20 years, he and his political mentors have been telling us that capitalist contradictions were a thing of the past. The fraudulent nature of such claims is now being brilliantly demonstrated in practice. It is a demonstration which can only intensify the political crisis of all the revisionist groups.

BY A FOREIGN CORRESPONDENT ACCORDING to diplomats in Peking an even closer stage in Sino-American cooperation has opened foll swing two hours of late nigh t talks between Chairman Mao Tse-tung and Nixon's Dr Henry Kissinger.

One western envoy was quoted as saying: 'Chairman Mao has given his blessing to a higher stage in Sino-American relations and this reception is a signal to this effect both to the outside world and to the people of China?

Another diplomat said it was now 'extremely likely' that there would be an American diplomatic presence in Peking before the end of this year and that the possibility of full-scale diplomatic relations sooner than expected could not be ruled out. Diplomats said Dr Kissinger's reception by Mao was a completely different thing from Mao's meeting with Nixon during the latter's visit a year ago. "There was no reason of protocol why the chairman should see Dr Kissinger. It was completely unexpected,' one said.

The text of the communiqué issued after the visit said Mao had asked Kissinger to convey his regards to Nixon. This was also regarded as significant: 'For this to be published by New China News Agency and to appear in Chinese news media is another clear indication that relations between China and America have reached a new stage, said one envoy.

It makes clear that having left the Vietnamese liberation fighters to struggle on under the phoney 'ceasefire' terms the Chinese Stalinists are now giving the green light for even closer collaboration with imperialism.

COUNSEL defending 11 Greek students charged with insulting the authorities claimed in court yesterday the trial was being held in a climate of terror and accused police of persecuting defence witnesses. After defence protests, witnesses, relatives and members of the public were allowed into court.

February 19, 1973 PAGE