How Financial Democracy robbed working people of the Age of Leisure.


As far back as 1932, Mosley foresaw the tremendous impact that the automation of industry, commerce and agriculture was going to have on the British and European economies. Mosley had seen with his own eyes how the application of new technologies at the Ford car factory in Detroit had boosted the productivity of its workers beyond recognition. He knew it was only the beginning of a process that would reach out and change every area of human endeavour. He also realised the implications – that it could be either an immense boon to working people or the source of great unemployment and the erosion of those benefits won by a century and a half of trade union activity.

Even in the pre-War age of mechanical systems, the application of science was to increase the output of men and women three or four-fold. After the War, new electronic technologies promised to raise productivity five-fold or more. And that was before the introduction of computers in every factory and office – and the advent of Computer Aided Design and Manufacture.

Higher wages and a shorter working week.

Mosley was one of the first to address this momentous issue in a series of essays and articles in the early 1950s*. The new post-war automation not only made possible a new age of plenty but a new age of leisure. As working people’s output increased many times over not only could wages and salaries be raised but the working day and week reduced at the same time. Paid holidays could be increased by several more weeks a year and the retirement age lowered.

Why not retirement for all at 55? Why not indeed – working people using machines and computers were producing goods and services at a rate unimaginable just a generation previously. Sociologists even began to worry about how people would cope with all the extra leisure time.

You didn’t have to be a graduate with honours of the London School of Economics to know that for all those extra goods and services to be bought there was one imperative. It was essential that the purchasing power of the people must be raised in line with output – otherwise most of the extra production would remain unsold.

It was to meet this danger that Mosley developed his ‘Wage-Price Mechanism’^ to ensure that consumption always equalled production. Otherwise goods would simply pile up on shelves and in warehouses: the first warning of slump, recession and mass unemployment as experienced in the Great Depression of 1931.

Although productivity did rise during the post-War years, and although wage rates and paid holidays did increase, the benefits to working people were never to match the potential of technology to increase the means to produce.

Indeed, today in 2013 retirement age is going up to 70 instead of down to 55. People are having to work longer hours for less pay rather than shorter hours for more pay. For many the Minimum National Wage is the norm. And 10% of the working population have no job at all. Even concessions like free prescriptions and bus passes are being delayed ten years until people reach 70 years of age.

Working people in the UK and across Europe have the right to say: “We were robbed!”

So what went wrong?

What went wrong is very simple: we needed a Mosley government that would have passed legislation to establish the principle that modern technology could not be used to put people out of work.

Technology could only be used to increase wealth and the standard of living for all. If for any reason automation would lead to over-production, those workers should be redeployed elsewhere in the company on comparative wages or given generous early retirement. For most of us the only question would have been “Do you want even higher pay or more leisure time?”

But there was no post-War Mosley government. As a result, industrialists, venture capitalists and financiers were free to choose their own agenda. That meant that instead of increasing wages at a rate commensurate with rising productivity, they simply used new technology to boost profits by cutting their largest ‘overhead’ – the workforce. This was a major cause of U.K. unemployment running into millions: a constant factor from around 1970 onwards.

Financial democracy had triumphed once more. The Tories turned their heads the other way in deference to their friends in the City and the Labour Party did what it can always be relied upon to do – it failed working people in the hour they needed help most.

The demonisation of the unemployed.

Not content with creating and maintaining a pool of up to four-million unemployed, the present Tory government (supported by its Lib-Dem collaborators) doesn’t even want to pay these unfortunate citizens any welfare benefits for their subsistence.

Helped by their reactionary pals at the Sun and the Daily Mail, the Tories are rolling out a carefully concerted campaign to brand all unemployed as workshy scroungers without exception. If only they had the gumption to get out of bed before noon they’d soon find a job, reason Cameron and Osborne. So life is to be made as uncomfortable as possible to force these spongers and freeloaders to ‘man up’ and start working.

Most people are likely to be unemployed at some time in their working lives. That’s why we have to pay hefty National Insurance contributions when in work to cover benefits paid when out of work. Nobody should be publicly humiliated for drawing the £70 a week pittance that Job Seeker’s Allowance pays any more than they should be ashamed to draw the State Pension.

The overwhelming majority of British unemployed would give their eye teeth and right arms for a job and are actively seeking work. But the simple mathematics are that there are over 3,000,000 people unemployed and only 300,000 vacancies.

Why can’t Cameron, Osborne and arch-collaborator Clegg do the maths and realise that no matter how much they humiliate the unemployed there is only one vacancy for every ten people unemployed? It of course goes without saying that the very small number of genuine scroungers, who would feel at home in the TV series ‘Shameless’, should be strictly dealt with.

When MPs in Parliament rubbish British citizens seeking work let it never be forgotten that the present financial melt-down, which has added millions more to the ranks of the unemployed, happened on their watch.

Can anybody remember the Tories warning of the sharp practices of their soul mates in financial services in the run up to the 2008 crash? And how come the Labour leadership under Gordon Brown, marketed as ‘Mr. Prudence’ in financial matters, was blind to bankers selling loans to people and companies they knew couldn’t repay them – just to swell their end-of-month bonuses and commissions. We can only conclude that most of them were too busy fiddling their parliamentary expenses to notice.

Mosley had the answer years ago.

Trying to survive on £70 a week Job Seekers is a long cry from the Age of Plenty and Leisure that automation promised a generation or two ago. But as Dan Harmston, the post-War Union Movement leader for East London, used to say “there is no problem in the world that cannot be solved by the application of human thought.”

Democratic Socialism based on nationalisation failed miserably in the post-War era. Even the British Labour Party recognised this and dropped its advocacy of the state ownership of industry in the 1970s. Then the Communists rejected Communism in the late 1980s: the Soviet bloc had tried it for up to 70 years and it failed to deliver the goods. Finally, since the fiscal crash of 2008, Capitalism has fallen into disrepute and is completely discredited – exposed as the refuge of financial scoundrels and existing only for the benefit of the fortunate few.

There is now only one alternative to these failed dinosaurs of the nineteenth century – the Third Position of social syndicalism that Mosley advocated in various forms ever since he resigned from the Labour Government in 1932.

Instead of companies being owned by the state or by absentee shareholders, every company above a certain size should be owned corporately by its employees. Present shareholders would be paid off and every employee would become a stakeholder in the firm they work for. All profits would be distributed to them alone according to individual skill and responsibility and all major decisions decided by them or their elected representatives. ‘Industrial democracy’ would become a reality for millions of British and European working people for the first time.

Mosley’s Wage-Price Mechanism would then ensure that as technology increases productivity, wages would be increased correspondingly – not only in the service of social justice but to ensure that the purchasing power of the market is sufficient to guarantee that all goods and services are sold. Thus supply will always be equalled by demand so ending the causes of slump, recession, deflation and inflation.

Corporate or syndical ownership isn’t just the next contender waiting in the wings. It’s the only contender left. Not only does it promise economic stability and a fairer distribution of wealth, it could yet deliver the Age of Leisure so long delayed.

But it will take mass action on the streets by young men and women with courage, commitment and the resolve to face up to global capitalism and financial gangsterdom to give it form. Nothing worthwhile was ever won from the comfort of a well-upholstered Ikea sofa.

* ‘Automation: Problem and Solution’ (1956), ‘Mosley – Policy and Debate’ (1955).
^European Socialism (1956). See also ‘Syndicalism – A Worker’s Policy’ (1953).

Gordon Beckwell.