SURPLUS

Unemployment is a direct and indispensable product of the capitalist system of production. But it is not a passive product. It is used as an active weapon to enforce the will of the state and the employers on the entire working class, whether in work or out.

Karl Marx, exposing the innermost mechanisms of the system, wrote: "The surplus labouring population is the lever of capitalist accumulation, nay, a condition of existence of the capitalist mode of production.' In the 1930s the British government, faced with financial and economic disaster, laid siege to the entire working population hehalf of the Citv. foreign bankers "'and' the employers. • A virtually leaderless working class — Labour, trade union and Communist Party leaders had consistently betrayed the Labour movement in preceding years aced a massive political attack on wages, jobs, social welfare, strikes, unions and all previously won rights and conditions.

During this decade, unemployment never fell below 1} million (one 13 of the working population) and twice it nearly reached 3 million.

It was not just Britain, but the the entire world capitalist system which was in crisis, triggered by the 1929 Wall St stockmarket crash. In the first five years of the 1930s. the United States government spent millions of dollars on destruction of commodities, raw materials and means of production because of so-called 'over-production'.

Unpicked cotton was ploughed up and millions of soWS slaughtered to prevent 'overbreeding' of pigs. While workers went ragged and hungry, $250m were paid to farmers to reduce cotton and wheat acreages.

In Brazil, in 1932, over 10 million bags of "surplus' coffee were destroyed. At the same time, in Europe, millions of farm animals were killed and incinerated so the carcases could not be sold. Machines were scrapped and factories closed and left to fall into ruins.

In Britain a company was set up in 1930 to dismantle shipyards and an Act was put through parliament by the Labour government virtually limiting coal production. The employers in a variety of industries called for heavy tariffs on imports to stem the 'dumping' of cheap goods in Britain.

Farmers did the same. Fresh milk was said to be heavily in glut, yet was too expensive for the majority of workers who bought the skimmed ('Unfit For Babies' ', said the label) or condensed varieties.

In May 1931 the collapse of the Austrian Credit-Anstalt Bank led to a succession of bank failures and panics in Europe on Top: Wall Street speculators before top of the already acute trade depression.

The weak position of the pound and general loss of confidence in British finance led to demands from the City and from foreign bankers that cuts must be made in public spending and, in particular, in unemployment benefit to the 2.7 million out of work.

In order to 'restore confidence' in British capitalism and to meet the terms of huge loans asked from the French and American banks, a ruthless war on workers' incomes was to be launched.

In power was a Labour government led by James Ramsay MacDonald. It was elected in 1929 on a policy which included the ending of unemployment. This was to be carried out by 'rationalization of industry' and a 'drive for maximum efficiency' which was to create more jobs. What was created, however, was the crash. Above: ploughing cotton more than double the amount of unemployment—it had been 1.3 million in 1929.

A committee of capitalists set in February 1931 by MacDonald to advise on eco nomic measures, estimated that by 1932 there would be a budgetary deficit of f120m if immediate action were not taken. spending totalling E96m, includ It recommended cuts in Includ ing a 20-per-cent reduction in unemployment benefit and heavy wage cuts for government employees.

A Royal Commission on Unemployment Insurance recommended, on June 4, 1931, a tightening-up of qualifications for dole, increased contributions and a cut in the rate. It argued that unemployment pay was insidiously sapping the whole social and financial stability of the country.

MacDonald and the Labour back Into the ground, southern USA Cabinet had no second thoughts about supporting measures to try and solve the crisis and save capitalism.

They agreed to cuts totalling £56.4m. These included:

Unemployment in s u £22m.

Roads: £9m.

Education: £10.7m Cineachers a 15-per-cent cut in teachers pay).

However, the Tories and the bankers-English and foreignmade it clear that this was not enough. At least £25m-£30m more must be cut, mainly from unemployment insurance, if a foreign loan was to be assured.

But some of the Cabinet, at least, could not stomach the bigger reduction in dole. What would happen to a party of reform which not only could not provide reforms, but must even take back those already obtained? the requirements of the bankers, particularly as they had agreed that a 10-per-cent instead • of a 20-per-cent cut in dole might be enough. The voting was 1l to nine, but the split meant the end the government, which resigned on August 24, 1931.

Immediately, MacDonald joined with the Conservatives and Liberals in setting up a 'National Government' to put the bankers' measures through and launch a vicious against the working class. The new Cabinet consisted of four Labour members, four Conservative and two Liberal members.

The Labour. members were MacDonald, Lord Sankey, Philip Snowden and J. H. Thomas, head of the National Union of Railwaymen.

The National government was immediately backed by the bankers and the employers and an £80m loan was made available jointly by the Bank of France and the Federal Reserve Bank of New York.

Previously the King, George V, had told MacDonald that he was the only man to lead the country and that the Liberals would support him 'in restoring the confidence of foreigners in the financial stability of the country. Now, having accepted the job, MacDonald can remark to Snowden: Tomorrow every duchess in London will want to kiss me.' Terrible years followed for the working class. The dole was immediately cut by law from 17s to 15s. 3d for adult men, and for a wife, from 9s to 8s.

The Means Test was introduced which demanded that the unemployed must submit to crossquestioning and house searching by the Poor Law Authority. For having saved a few pounds or kept a few precious possessions, thousands had their dole further cut or stopped altogether.

The time during which benefit could be drawn as of right was cut from over a year to 26 weeks—-a diabolical act against those who had been out of a job the longest. In fact, nearly, 20 per cent of the unemployed had been without work longer than this period and many had not been in employment for years.

After the 26 weeks, only so-called 'transitional payments' decided by the means test were available. At the same time, unemployment insurance contributions were raised for men at work from 7d to 10d a week.

(Official - figures put average wages during the 1930s at around £3 for a 46-hour week, though workers throughout entire industries were well below this level.)

An Anomalies Act was introduced, the main effect of which was to strike thousands married women off benefits. By the end of the year over 170,000 women had been disallowed this way. Those struck off did not register as no benefit was paid, so were not included in the unemployment figures.

A few months later, in 1932, all subsidies for council house building in England and Wales, except for slum clearance were abolished, and drastically reduced in Scotland.

In education, expenditure on school-building was cut from £9.2m in 1930-1931 to £2.7m in 1933-1934—and this with 1,500 elementary schools still on a black list drawn up in 19211 Free places in secondary schools were abolished and replaced with "special places based on a means test. The system of free school meals to children of poorer families was tightened up, the meals were to be supplied only on a doctor's report of malnutrition.

Wages of police, armed forces and teachers were to be reduced by up to 20 per cent, including a 15 per cent cut for teachers. A massive campaign against the reduction was organized by the teachers.

Bernard Franks' next article will describe how the attack on the working class was intensified. CONTINUED

February cases came before' the 294