Tag Archives: Hillel Ticktin

Communist University 2013


August 12-18, south London

Preparations for the Communist University, our annual school, are well advanced and the 2013 timetable features some outstanding speakers on key issues. The CPGB website will be regularly updated with tweaks to the timetable and profiles of our speakers, but here are a few who have confirmed so far and the subjects they will be addressing:

* Adam Hanieh is a lecturer in development studies at the School of Oriental and African Studies (SOAS), University of London. He is author ofCapitalism and Class in the Gulf Arab States and a member of the editorial board of the journal, Historical Materialism. At our school, Adam will be speaking on ‘The political economy of the Muslim Brotherhood’ on Wednesday, August 14. For comrades’ interest, he opened on‘The capitalist crisis and the Arab Spring’ in November of last year at a gathering organised by the Kurdish Academic Forum.

* Hillel Ticktin is one of the leading Marxist political economists in the world. Originally from South Africa, he left the country to avoid arrest for political activism. After some time working for his PhD in the Soviet Union – where he again attracted the disapproval of the authorities – he began teaching at the University of Glasgow in 1965, and in 1973 he co-founded Critique: Journal of Socialist Theory, an independent, scholarly Marxist journal. Comrade Ticktin has been a regular atCommunist University over years and a frequent contributor to our paper. He will be presenting three sessions for us in August – ‘Capitalist crises and the causes’ (Wednesday, August 14), ‘Capitalism: terminal crisis or long term decline?’ (Thursday, August 15) and ‘Socialism or barbarism’ (Saturday, August 17).

* The left’s response to the global crisis of capitalism has been essentially Keynesian. So the title of our morning session on Friday, August 16 – ‘Does Keynesianism offer an alternative to austerity?’ – is apposite for all those who regard themselves as Marxists, or revolutionaries of some stripe. It is presented by the CPGB’s Mike Macnair, a member of the party’s leadership and a frequent contributor to the Weekly Worker. Mike has written and spoken on this subject in the past and it is clearly one that we need to keep returning to given the left’s stubborn insistence that this non-Marxist (actually anti-Marxist) politics is a supportable ‘alternative’ to capitalist austerity.

* OnTuesday, August 13 Mike Gonzalez will be discussing with Nick Rogers the question, ‘After Chavez: where next for the Bolivarian revolution?’ Mike has written widely on Latin America from the state capitalist perspective of the International Socialist tradition of Tony Cliff. (See his Che Guevara and the Cuban revolution). He is a historian, a prolific author and literary critic. For a time, he also was the professor of Latin American Studies in the Hispanics department of the University of Glasgow. He was videoed speaking on ‘The politics of water’ at a Socialist Workers Party (Ireland) event in November of last year.

*Yassamine Mather is an Iranian socialist in exile in Britain. Her political activities on the Iranian left started in 1980s Tehran and later in Kurdistan. In exile, she has been on the editorial board of the monthly journal Jahan and a member of the coordinating committee of Workers Left Unity Iran. She is also a member of the Centre for Socialist Theory and Movements (Glasgow University) and the deputy editor of the journalCritique. Since 2007 she has been active in Hands Off the People of Iran (HOPI).She will be speaking in a debate on feminism(s) with Camilla Power.

*Camilla Power is a senior lecturer in evolutionary anthropology at the University of East London, with a particular interest in female coalitionary strategies, ritual and early human kinship. She uses modern Darwinian selfish-gene sexual selection theory to understand the origins of symbolic culture. She is a leading member of the Radical Anthropology Group and has spoken frequently at Communist University. She will be speaking in a debate on feminism(s) with Yassamine Mather.


Comrades attending Communist University for the first time often remark that its culture is very different to other left schools. For example, writing in the Weekly Worker Paul Demarty regrets the “cosy diplomatic speechifying” that generally characterises the annual Marxism school staged by the Socialist Workers Party. This flows from a tacit “diplomatic arrangement” between the event organisers and the ‘star’ non-SWP speakers – the “horse trading” consists of “the SWP granting the speaker a large and enthusiastic audience in central London. In return, the speaker offers the SWP an implicitendorsement of the image it wishes to project: a non-sectarian, unifying force on the radical left, offering up its resources to ‘build the movement’.”

Our school actually makes an effort to explore real differences between comrades, to give critical minorities the time and space to make their arguments and to challenge comrades’ pre-conceptions. We are genuinely out to educate, in other words – both ourselves and others. In the lead up to last year’s CU, we made this video with the CPGB’s national organiser, Mark Fischer, to give comrades a feel for the event.

For booking and venue details, go here. Main Communist University 2013 Index here.

Fundamentals of Political Economy – weekend school January 21-22

Fundamentals of Political Economy, January 21-22, 11am-5pm. Room 2b, University of London Union, Malet Street, London. Cost: £10 waged, £5 concessions. Email office@cpgb.org.uk to reserve your place.

In 2008 the banks crashed. States round the world bailed them out by borrowing money. Inevitably, this did not get rid of the crisis but rather gradually transmuted it into a crisis of the creditworthiness of individual states: today the crisis of Eurozone state creditworthiness threatens a new bank melt-down (which may already have happened by the time of this weekend school).

The ‘solution’ demanded by governments and the media is austerity. Creditors – ‘savers’ –  must not be made to accept the losses: the working class, both in and out of paid work, must do so. Predictably, the result is an economic downward spiral – as seen in Greece, but coming now to the rest of Europe.

The ‘Occupy’ movement has represented a cry of rage but not put forward a clear alternative. The broad left, including the far left, has committed itself to Keynesian ideas – that states should borrow more and spend more and hope by doing so to grow ‘their way out’ of the crisis.

Understanding the unfolding crisis and proposing real alternatives requires us to grasp Karl Marx’s critique of political economy. But while education in the basics of Marx’s ideas was commonplace on the far left in the 1970s, today it has withered away: there are academics and theorists who ‘do’ political economy, while left activists and groups ‘do’ only campaigns.

Our school aims in a small way to contribute to beginning to overcome this gap in the education of the left. We are therefore seeking to address fundamentals rather than to tackle the analysis of the crisis directly.

Fundamentals of Political Economy, January 21-22, 11am-5pm. Room 2b, University of London Union, Malet Street, London. Cost: £10 waged, £5 concessions. Email office@cpgb.org.uk to reserve your place.

Topics and speakers:

Moshé Machover

1. The Labour theory of value – Moshé Machover

The labour theory of value and how it should be understood is the fundamental centre of Marx’s critique of political economy: the basis on which all else is built.

Academic and long-standing militant Moshé Machover coauthored with Emmanuel Farjoun Laws of Chaos: a probabilistic approach to political economy (1985), pioneering an approach which has been used by some Marxist theorists and criticised by others. He gave a paper explaining the approach to the Historical Materialism Conference this year, which is recommended reading.

2. Money and finance capital – Hillel Ticktin

Hillel Ticktin

The financial system is at the centre of the present crisis. But what is the underlying basis on which the luxuriant overgrowth of financial institutions and instruments has grown up?

Hillel Ticktin is the editor of Critique journal. He has written numerous articles on finance capital and the ‘financial turn’ of the 1980s and its consequences and on the shape of the present crisis.

Werner Bonefeld

3. Political economy and the state – Werner Bonefeld

Keynesian and nationalist ‘solutions’ to the present crisis rest in the last analysis on the illusion that the nation-state stands above classes and can ‘manage’ the monetary and financial system so as to overcome the crisis. How does the state relate to the capitalist economy?

Werner Bonefeld is one of the founders of the ‘Open Marxism’ school of Marxist theory. His work on the state and political economy has been published in Critique, Capital and Class and elsewhere.

Mike Macnair

4. Against Keynesianism – Mike Macnair

John Maynard Keynes’ General Theory of Employment, Interest and Money (1936) was a muddled partial critique of the ‘orthodox’ economics of his day while remaining within the fundamental ‘orthodox’ ideas of marginal utility and equilibrium – though full of striking phrases. Its assumptions are deeply nationalist. Keynesianism is popular among opponents of the policy of austerity because it seems to have ‘worked’ in the 1950s and 60s. It seemed to do so, in reality, because of the results of World War II.

Mike Macnair is a regular writer for the Weekly Worker, among other issues on the present crisis and its implications.

Marx’s spectre haunts the wealthy and powerful

The ruling class has no workable strategy for rescuing the system, argues Hillel Ticktin (originally published in the Weekly Worker)

Worshipping the market

The depression – called some years ago the ‘third great depression’ following on the long depression at the end of the 19th century and the great depression of 1929 onwards – is now official, as it were. Martin Wolf ’s recent article in the Financial Times produced a series of statistics showing that the present downturn has already lasted longer than previous downturns in the last century. His arguments are, of course, statistical and bound within orthodox economics, even if he leans to a moderate Keynesian analysis.[1]

Engels had predicted that downturns would become worse at the end of the 19th century, but he was proved wrong because of the turn to imperialism on the part of the great powers. However, it is clear that his observation of the underlying tendency was basically correct. In turn, the various depression-era economists of different persuasions now look more credible. The Keynesians, however, may have had their day, given the refusal of governments and a section of the ruling class to move in their direction.

The earlier interventionist policies in 2008-09 have now been replaced by stringency and austerity. It is not that the insights of the Keynesians have not been recognised, but their policies are regarded as too dangerous to follow. Hyman Minsky has had his moment. Perhaps the greatest triumph of the Keynesians since the adoption of the Bretton-Woods agreements has been the recognition that their policies would work, but are so dangerous to capitalism itself that they have to be avoided at all costs.

It is paradoxical that the situation is so dangerous that the rich have to pretend that their wealth is playing no role in capitalism. We not only have the absurdity of trillions of dollars being held privately in various banks, but we now have one bank, the Bank of New York Mellon, charging for the trillions it holds, knowing it cannot be invested anywhere.[2] “It is the world’s largest custodian serving the world’s largest investors.”[3]

The problem the Keynesians attempted to solve lay in the difficulty of selling due to low incomes. Today, the rich are not even spending their money on yachts or luxury cars or castles, but saving it, and the amounts are so great that governments cannot compensate for their lack of investment without taxing the rich, who are financing political movements against taxation. Finance capital itself has been so concentrated that in the USA six investment/commercial banks – Bank of America, Citigroup, Morgan Stanley, Goldman-Sachs, JP Morgan Chase and Wells Fargo – hold assets worth 60% of US GDP, and “dominate the financial industry”.[4] At the same time, the government is implementing austerity measures directed against the majority of the population. The rich have got richer and the government is making the poor poorer. In the USA, at least, it is abundantly clear that the government could solve its fiscal problem through a rise in taxation on the wealthy.

The riots in Britain – preceded as they were by student protests and semi-riots – were rationalised away by the Conservative government, loyally supported by a rightwing press. No level of state repression, under the British prime minister’s name of ‘tough love’, against a recalcitrant population will alter the growing, though inchoate, demand for ‘regime change’ under conditions of growing inequality. The question is not whether there will be a powerful movement for the replacement of the market by a society rationally planned in the interests of the ordinary population, but how much longer it will take to develop. Marx’s spectre of communism is very much the ghostly presence feared by the wealthy and powerful, even if they do not understand what shape it will take.

No doubt the crisis will continue to take on a series of forms, from the initial financial implosion to the present-day threat of sovereign default and continued low growth. The present euro crisis is insoluble because it is a microcosm of the general crisis, which itself has no solution. However, its forms are specific. We have the expression of German nationalism, representing the first time that the German bourgeoisie feels it can shake off the heritage of the last world war and Nazism, and express its interests directly and clearly. The clash between France and Germany, Sarkozy and Merkel, has been relatively low-key, but it is there nonetheless. However, the Germans have found that it is not easy. The less prosperous countries of the euro zone are not prepared to accept German dictation of the economic terms of survival.

There is no obvious reason, in any case, why the terms of trade between Germany and any particular country in the European Union should be what they are. Why are agricultural goods relatively cheap, compared with machinery or automobiles? Only believers in the market accept market prices as fair, just or somehow correct. The commentators effectively argue that those countries whose industry is less developed should adopt a tight fiscal policy, given their need to import industrial goods from Germany. Such a policy cannot work under any circumstances. The only result, to be welcomed, will be the establishment of a uniform policy of economic repression sufficient to proletarianise the ‘middle class’ and drive the working class across the euro zone to forms of direct action.

The persistent failure of the euro zone to adopt a credible policy is indicative both of its divisions and of the real lack of a solution.[5] However, the German bourgeoisie really has no choice, unless it wants to lose the common market, stable economic relations with its neighbours and a relatively low-value currency. The proposed expulsion of Greece with its subsequent default would impoverish the population even further and create havoc among European banks, and is therefore a crazy solution. Even if the banks are saved before that event, and the default cauterised as a result, the knock-on effect on the bonds of the other countries – by now including practically all the Mediterranean members, plus Ireland – will be enough to make Germany avoid that way out. Apart from anything else, it will force the formation of a French zone, as opposed to a German one. As the country which will lose most, apart from Greece, the German bourgeoisie cannot take that line.

In reality, because a default or an exit from the euro zone will be globally destabilising, Greece is in a strong position and its government could have taken a much stronger line. Its government, however, is pusillanimous, reflecting the nature of its bourgeoisie, which has sent its money out of the country. Indeed, the way the bourgeoisie uses tax havens to shelter its money or to avoid tax or both plays a big role in the destabilisation of much of the world economy.

India and China

There is little that is politically more absurd than the constant reference to the importance of China and its role as the next big power. The similar reference to India is equal nonsense. It is argued that China and India or perhaps one or the other can save the world from its crisis. If it was not so commonly held, one could ignore it.

As regards India, we hear that “per head energy and protein intake has been falling for the last two decades, as the majority of the population is unable to afford enough food”.[6] Pankaj Mishra argues that the propaganda about India is closer to the myths produced by another country (presumably the USSR), “where statistics were shamelessly manipulated and a tiny, privileged elite dominating both political and economic life lorded it over the rest”.[7] The fact is that levels of productivity in China or India are a fraction of that in the USA, and they have no chance of catching up with the west, under capitalism.

In the case of China, it seems that it cannot now play the role that it did in 2008-09, when it expanded the money supply in order to avoid a contraction and so played an important role in avoiding a deeper downturn. Its growth rate is predicted to halve. “Finance is not the only area in which Beijing’s ability to launch a counter-cyclical economic stimulus has ebbed. The ability of local governments, if asked again by Beijing, to boost investments is questionable.”[8]


On the one hand, the capitalist class thinks that it has dispensed with a communist/socialist alternative with the end of Stalinism. On the other hand, it also knows that the despair of the white- and blue-collar workers can and will turn to action in order to overthrow a social system which has outlived its time, in order to replace it with one controlled from below. The ruling class prefers to believe that such a society will be worse than capitalism, though there have always been some who are realistic enough to realise that the current inequality of wealth in the midst of massive poverty is insupportable.

In other words, the ruling class is divided, but all sections are concerned with the need to defend the system. At the same time, as in any time of global change, parts of the ruling class or its employees have begun to question their positions. In the UK, Marx has been quoted and some of his words supported by a series of establishment figures. None of them have become Marxist, and all would perhaps find reasons why Marx was wrong to want socialism, and indeed, no doubt, is still fundamentally wrong. Charles Moore,[9] biographer of Lady Thatcher and former editor of the rightwing Daily Telegraph, George Magnus of UBS, [10] former advocate of the new right in the 80s, John Gray,[11] philosopher and leading light in the founding of a new private university in London, and Sam Brittan,[12] long-time leading commentator at the Financial Times, are some of the figures reported in the press commenting on Marx or the left. Lord Skidelsky, biographer of Keynes, wrote: “as more and more people find themselves with enough, one might expect the spirit of gain to lose its social approbation. Capitalism would have done its work, and the profit motive would resume its place in the rogues’ gallery.”[13]

When the present crisis was in its earlier phase, we previously quoted an advice from JPMorgan,[14] to the effect that Marx might have had a point. The News International newspaper, The Times, wrote a sneering editorial in October 2008 in which it said that the world moves in mysterious ways and the fact that Marx’s Das Kapital had become a bestseller in Germany was particularly mysterious. It referred to the fact that Sarkozy, president of France, was photographed reading that work and that Pope Benedict had praised Marx’s analytical skills. The then German finance minister, Peer Steinbrück, as befits a social democrat, was apparently less taken with Marx, but was prepared to concede that some of his thinking was “not that bad”.[15] However, it was implied that this was little more than a fashion which was bound to pass. Three years later, it seems that Marx has come to the fore yet again and News International is suffering its own crisis.

The fact that they are looking at Marx shows, in the first instance, a collapse of confidence, first displayed in 2007-08. This, in turn, can have three possible meanings. The first is that Marx is simply a convenient icon to express their fear of the long-term damage done to the system. It does not necessarily indicate anything about their support for the market. The second is that they recognise that the market has had its day, though they do not necessarily see an alternative. The third possibility is latent in the other two. It is that they have begun to shift politically towards the left, without supporting any party, but it is yet to show itself. Here the problem is the absence of any significant Marxist party, to speed up the process.

Murdoch scandal

The ruling class has lost confidence in areas of life beyond the economy, however basic that is. The whole ‘Murdoch scandal’ is much more than a question of the illegal hacking of phones.

One of the prime movers in the British parliament, Labour MP Tom Watson, had this to say in an interview on the question: “When I was first elected I was a completely naive and gauche politician. You look at the pillars of the state: politics, the media, police, lawyers – they’ve all got their formal role, and then nestling above that is that power elite who are networked in through soft, social links, that are actually running the show.”[16] This could have come from Bernard Shaw’s play Major Barbara and the sentiment is very much at the heart of any Marxist political understanding of modern society, which now stands vindicated through a direct investigation of one of the threads the ruling class uses to rule. The involvement of the police, civil servants, members of parliament and journalists, all apparently connected to the Murdoch family, simply confirms a picture long held by Marxists, and often regarded with contempt by liberals.

It is clear that both bourgeois ideology and the parliamentary political system are in trouble. In one country after another, scandals of various kinds are rocking the system. One has only to look back at Marx’s description of Europe in 1848, France in particular, to realise that the eruption of so-called scandals today is part of a more general discontent in society, which is leading to increasing division in the ruling class and an increasing loss of confidence.

In this situation, the UK leads the pack, though demonstrations and organised forms of protest may be more frequent and more powerful in other countries. The nature of the student demonstrations and the English riots over the summer of 2011, whatever their immediate background, are unprecedented in English history. As the former global imperial power and junior partner to its successor, the United States, the British ruling class has propagated an ideology based on the view that it has been the founder of modern democracy, taking it over, as it were, from the ancient Greeks (by contrast, the ruling class ideology in the United States rests more on the so-called ‘American dream’, of meritocracy winning out, even though there is much made of democracy). Hence the recent scandals of members of parliament enriching themselves through claims for expenses, and the clear connections between politicians, policemen, journalists, private detectives and the Murdoch empire have struck at the heart of that ideology.

Under increasingly harsh economic conditions, with the media constantly talking about reckless and consequently illiquid and insolvent banks, whose executives, unbelievably still earn millions in annual salaries, the ruling class and government have to find arguments to support the existing socio-economic system. Yet every day seems to provide reasons for changing it. The immediate implications of the ongoing Murdoch scandal lead to a demand for a more open and democratic political system, the control of companies and indeed the press by those who do the ordinary work, rather than a dictatorship of a single individual, like Murdoch, or the CEO of a bank or industrial firm. This is not socialism and it is not viable, or likely to happen, under capitalism, but it is the kind of question that arises and blows open the ruling ideology, in however inchoate a way.


It is almost as if the ruling class has decided to commit suicide. It is going for an economic policy which is at best utopian and at worst catastrophic. Austerity for the vast majority and increasing riches for the ruling class is only a viable policy under conditions where there is absolutely no challenge to the system, and ordinary workers are so weak, both healthwise and in terms of organisation, that they pose no threat.

There really is no alternative to the replacement of the capitalist system by a genuine socialist system, which in the end is the only rationally ordered or planned system, in which decisions are made and controlled from below, not decided from above, however benign the ruler. Twist and turn as the beneficiaries of the system might, they have run out of strategies to delay change. As we have argued before, the ruling class has used finance capital/imperialism, world wars, cold war-welfare state and finance capital again as modes of survival. Finance capital has now imploded, while the colonies are now politically if not economically independent, the cold war is over and world war is no longer possible. The return to the welfare state without the cold war and Stalinism would only be the first step to loss of control, as became evident in the 70s of the last century.

Furthermore, it is clear that the global reach of the American empire is shrinking. The imperial power of the United States is in decline – and the decline of the leading capitalist power, without a successor in sight, can only herald the more rapid decline of the social system.

One might have predicted that there would have been a successor. There has been one such eventuality, after all, with the USA replacing the UK. However, Europe is engulfed in its own crisis, which is only expressing on a national scale the kind of inequality which exists in the society as a whole. There is no prospect of another country conquering the world, whether by force of arms or through finance capital, even if it had the industrial and military might of the United States without its debts. China, the country usually cited in this connection, is not in that position, and it does not even have the same drives or the same intensity of those drives, as modern capitalism.

So are we now witnessing the last days of the greatest empire the world has seen, the last days of a system which brought the world to a level of productivity so great that it made abundance for all a real possibility? The system was overthrown in Russia in 1917, and the world has been waiting for the potential replacement to show itself in a form other than Stalinism ever since. Delay is as good as a temporary defeat. In the end, Stalinism has been crucial to the preservation of capitalism, but it is no more and cannot be resuscitated. It is true that it is playing a negative role in Greece at this time and in a number of other countries, including China. It is less true of western Europe, however.


As we approach the socialist future, the subjective plays an increasing role, as one might expect. In socialism, society is increasingly transparent and planning decisions are made by the population. The economy ceases to stand above mankind, and turns into the administration of things. Although we still live under capitalism, in spite of itself the ruling class has to rule and not leave the economy and society to an apparently impersonal market. However it is done – through governmental administration, through the parliamentary system, through the bureaucracy of the firm or through partially hidden ruling class institutions – the system is increasingly controlled.

In other words, before it comes to an end, there has to be a social-political form which stands in opposition to current political-economic forms. That does require a socialist party with intimate links to the working class. It has to be part of the majority of the society. It has to be trusted and it has to be internally democratic. There has to be a shift in consciousness towards socialism, in which the various doubts and slanders are discussed and dealt with.

As this shift has not occurred, capitalism is not directly threatened at this time. It is clear that there are threads leading to such a movement, but they are as yet only weak and easily broken. In the 1930s Trotsky spoke of a crisis of leadership. In a sense that is what is needed today, but the leadership has to be based on the will of the majority and that is yet to show itself. In the 30s, socialism had more support, making Trotsky’s analysis more understandable, but he was only right in so far as one could say that there was no socialist party to lead. He had underestimated the power of Stalinism.

Where are we?

If there is no direct challenge to capital, that does not mean that it is not in systemic trouble. One cannot read a commentary on present political economy which does not speak of ‘lack of confidence’. This use of the word ‘confidence’ is understood to mean that capitalists do not see how to make money by investing in the economy, as opposed to keeping their money in the bank or under a mattress. Above we discussed the question of confidence in another context – that of the system itself – and I will look at the two meanings and their relation.

Today, cash is king, even though inflation is reducing its value. This is not the usual situation in a depression, when deflation increases the value of the money held, even if no interest is paid. There appears to be no short-term or long-term solution. After all, money could be invested in a long-term project, expecting a return in 15-20 years, if the rich had confidence in the system. Whereas the short term concerns immediate issues, most of which will be resolved one way or another within a finite time, the long term concerns the health of the system, whether it survives or not. In the post-war years there have been relatively long periods when the stock market was depressed, but then revived, as occurred under Thatcher.

The result is that the usual advice given by stockbrokers to middle class, as opposed to rich, clients is to work on a 20-year perspective, which is pretty useless to many of their customers, who are often over 60. There is confidence in the capitalist system, on the one hand, and confidence in the possibility of making money by investing in the economy, on the other.

However, some sections of the capitalist class – small- to medium-size businessmen – do not invest and attribute their market problems to trade unions, government regulation and particular monopolies strangling the market. They see the solution in a long-term clean-out of workers’ organisations, a reduction in the role of the government and the protection of the national market. The financiers of the Tea Party seem to be of this ilk. Their intellectual allies are often fanatical supporters of the capitalist system, which they see as being damaged by its enemies. To a degree their lack of confidence is exaggerated by their ideologically based belief in the market and the threat supposedly posed by others.

The more serious section of the capitalist class, which controls finance and industry, recognises the lack of opportunity and the limits to demand at a time of mass unemployment and the increasing proletarianisation of the middle class. Its problem is that its investments are longer-term and require a limited reflation, but this section is worried that such reflation would become more general and could not be controlled. In other words, it continues to uphold its strategy of the last 30 years, in which it turned to finance capital, and so low growth and anti-welfare state measures. Finance capital, however, has imploded and hence the strategy is no longer viable. This section has been talking, therefore, of investing in industry, but it is worried that this could increase the confidence of the working class, and hence is holding back.

Today, more than ever, business confidence, so-called, is dependent on confidence in the capitalist system itself, even though the individual investor may not think like that. There is no strategy available to the capitalist class which has any kind of realistic chance of success, other than going for the growth of productive industry, but the bourgeoisie is afraid that this will produce a return to the 70s, with a powerful working class demanding concessions, and ultimately the supersession of the system.

As a result, the capitalist class is not only divided, but at sixes and sevens, with no real solution in sight. No leadership is possible because there is nowhere to lead other than to failure, disaster and possible catastrophe for the capitalist class itself. The most successful leader at this time will be the one who is able to understand the dilemma before him or her and takes the longest road to that result.

Conditions mature

The logical outcome of the present impasse is that the rightwing parties in government will lose their majorities. In a relatively short time we may expect that so-called centre-left parties will be in government in Italy, Germany and France. The Greek and Spanish ‘socialist’ parties’ willingness to accept the instructions to go for austerity sets the pattern for all such parties. Their discrediting, en masse as it were, will deepen the general dissatisfaction with the parliamentary-style democratic process, given that existing alternative parties will have cut the standard of living, supported by the media. There are already a number of countries with substantial far-right parties and no doubt there will be more.

Unfortunately, the left has not been able to establish itself anywhere, thus far. In Portugal, where it made a substantial breakthrough in previous elections, its vote halved in the middle of 2011, during the general elections. The attempt by the Revolutionary Communist League (LCR) in France and also the United Secretariat to dissolve itself as a Trotskyist formation and form an anti-capitalist left has failed in France and Portugal. They have, no doubt, learned their lesson.

It is clear that the ruling class has no strategy for the maintenance of the capitalist system. It is not able to rule in the old way. The first condition for revolution, as enunciated by Lenin, is in place.


1. M Wolf, ‘Britain must escape its longest depression’ Financial Times, September 1.

2. BNY Mellon, according to its own website has $1.3 trillion under management and $26.3 trillion under custody or administration: http://www.bnymellon.com/about/companyprofile.html.

3. Ibid.

4. J Cassidy How markets fail London 2010, p354.

5. Wolfgang Munchau argues that the optimum solution is a fiscal union, but that it may not happen or happen in time. Instead he argues that there could be a minimal political solution, but it would be monstrous (‘A euro zone quick fix will create a political monster’ Financial Times October 10).

6. Quoted in P Mishra, ‘India’s Tommy Hilfiger utopia is a bluff that will soon be called across the globe’ The Guardian September 10.

7. Ibid.

8. J Kynge, ‘The cracks in Beijing’s edifice’ Financial Times September 10.

9. C Moore, ‘I’m starting to think that the left might actually be right’ The Daily Telegraph July 22.

10. G Magnus, ‘Financial bust has bequeathed a crisis of capitalism’ Financial Times September 13.

11. J Gray, ‘A point of view: the revolution of capitalism’ BBC News Magazine September 4.

12. S Brittan, ‘Mistaken Marxist moments’ Financial Times August 25. Although Brittan takes a critical line on Marx, he appears to appreciate his depth.

13. R Skidelsky, ‘Life after capitalism’ Project Syndicate 2011: http://www.project-syndicate.org/commentary/skidelsky37/English.

14. M Cembalest and H Olsen, ‘Eye on the market’, item 6 – a commentary written for JPMorgan clients, October 7.

15. The Times October 20 2008.

16. Interview in The Guardian G2, August 3.

No alternative within capitalism

What does the bail-out of Greece mean for international capital? Hillel Ticktin, editor of the Critique journal, spoke to Yassamine Mather…

The BBC and Financial Times have commented that the Greek bail-out amounts to a short-term fix to buy time. The bulk of the package includes guarantees which they hope will ensure the euro will not collapse. The government debt of Greece alone amounts to over €250 billion or some 125% of its GDP, and what they have done is to convince the markets that the line will be held.

In February German chancellor Angela Merkel refused to intervene. If she had continued with that refusal, the situation would have become untenable. The sovereign debt crisis then got to the point where it could threaten Greece, Portugal, Spain, possibly Italy, Ireland and ultimately even Britain. The slide towards that was obvious right from the beginning. Most bourgeois commentators were saying that it would never be allowed to slide to that level, but it did. For that reason the Social Democrats in Germany criticised Angela Merkel.

The press in Britain was appalling. It tried to imply that the Social Democrats were some kind of extreme nationalists, who hated the Greeks and thought they were just lazy. But if you listen to what the Social Democrats were actually saying, it was not that at all. It is interesting that the British press were deliberately trying to foster anti-Greek and anti-German attitudes. The upshot of this has been that the euro zone powers let the Greek situation slide up to the point where there was no alternative: the euro and ultimately the capitalist system itself were under threat, so obviously there had to be a bail-out.

The second point is: what is the market? You constantly hear this nonsense, about how you cannot buck the market – but the market is not some inhuman, cosmic system that nobody can do anything about. It is just a section of the capitalist class deciding what to do with their money. Obviously if they think that Greece is going bankrupt, then they are going to withdraw their capital if possible. That is a completely rational approach and the idea that there is some sort of impersonal agency involved is nonsense.

It is also true that you can actually influence the people who control investment – they are really the same people who are influencing governments. In fact it is not thousands of individual capitalists either, it is a relatively small number of banks, funds and so on, which are moving money in and out. It is perfectly possible to consider where they are going and come to a deal with them.

Why was Latvia bailed out so easily last year, while there was reluctance to act on Greece? Latvia was a total basket case. It was, and in a sense still is, in tremendous trouble economically. That largely arose from the simple fact that the population of Latvia was able to borrow money in foreign currency at low interest rates, particularly from Sweden, Austria and to a degree Italy. With the downturn they could not repay. If the Latvians devalued the currency, it would become even more difficult for them to repay. This was a problem for the Swedish and Austrian banks. Latvia systematically refused to devalue because it wanted to join the euro and wanted to show its economy to be capable of undergoing the transition. The country was really teetering, as Greece is now, on the brink of total bankruptcy.

In February 2009 the International Monetary Fund got the relevant banks together and insisted there should be a bail-out. €78 billion was put aside for the Baltic countries, particularly Latvia. The way it is described in the Financial Times is that it was the banks were almost forced to do that. It was done secretly and reported afterwards. With Greece, however, it was all in the open.

What was really going on? The answer is that Merkel wanted to use Greece as a test case for dealing with the working class. She wanted to see cuts introduced in order to defeat the working class. There is no other way to understand it – if that was not the case, then why wait so long? Merkel did not act immediately, because the ruling class in Germany – and, it appears, important sections of the world’s ruling class – wanted to go for austerity, for control. You can see that happening in Britain by default, as it were, as a direct result of this ultimate bail-out. The condition which the Germans imposed was that of austerity throughout. France has now accepted this too. The euro zone, as a direct result of this package, has signed up to the German austerity policy. It will now experience a low or negative growth rate. Consequently for Britain the chances of being able to export more to the euro zone are considerably reduced.

Where next?

The possibility of Britain going the way of Greece is unlikely. As part of the deal announced by the EU the United States provided dollars to various countries and there is either a tacit or an explicit deal between the United States and Britain. It would be highly dangerous for the capitalist class to simply demand a whole series of cuts in Britain, which is still an imperialist power, despite being called a small country. This would lead to the working class beginning to act, which would be an ominous example for the world from the capitalists’ point of view.

The other aspect is that it is difficult to see a financial crisis arising in Britain, with money leaving the country and so forth. The bonds held are a long-term debt – investors sometimes have to wait 12 years or more before stocks pay out. Secondly, a large part of the debt is held in Britain itself, so it is not a balance of payments issue. On top of which there are still huge funds coming into Britain, partly because of this crisis. The Greek bourgeoisie is putting its money into Britain and British housing, hence, in part, the rising prices in London.

In the case of the other countries, it is different. In Ireland, austerity measures have not worked. Its huge budgetary gap remains and this will not change if all they rely on is austerity. If you cut the standard of living of the population and therefore production goes down, tax returns will also go down and so the gap increases. That is obvious and will happen in every country which simply goes for austerity, which is the point which has been made in relation to Greece. It is simply not enough to continue cutting. It does not work and will not work in Greece either, which is why they need to do something else.

In relation to Spain and Portugal, the problems involved are not just those of a fiscal deficit. As with Greece, it is also a balance of payments problem. One of the problems is that such countries are ‘uncompetitive on the international market’, as they put it. What they mean is that wages have been going up. In other words, the bourgeoisie has not been sufficiently strong to suppress the working class and has had to make concessions. Consequently wages have been rising in relative terms and the products of such countries have become uncompetitive on the world market or within the euro (previously they could devalue, but now they cannot).

They can borrow and the euro zone sector will effectively fund them for a time, but that cannot continue for ever. This is obvious in the case of Spain, but Italy’s economy is even bigger and has been in trouble for a long time. Its debt is over 100% of GDP and has been like that for years. Italy has managed to hold out up to now and in part that is because of its very rightwing government. A leftwing government would not be trusted and there would be immediate trouble. Italy may not be in trouble immediately, but it will be. In the long run the question is then whether the euro zone could hold up at all. That is not at all clear.


The exclusive focus on the deficit is a totally crazy policy. You cannot simply cut public services and raise taxes and expect to end the deficit. There has to be growth – this has been pointed out time and again by Keynesian economists. The only way to get rid of the deficit is through a sufficiently rapid growth and allowing inflation to come into play. That is what happened in the past.

It is not just Lord Skidelsky pointing this out. The Financial Times itself and a number of commentators, such as Sam Brittan, who after all, is in no sense social democratic, have said the same. Brittan wrote back in autumn 2009 that it is crazy to cut, which is true. So one has to ask what is going on. Why are they cutting in the euro zone and why are they cutting here? Why is the Republican Party so firmly against expansion, but insisting  on severe cuts?

It looks as though they are either taking the opportunity to try and defeat the working class – an attempt that is clearly happening in Greece. Or they are doing it as a defensive measure – afraid that in the present circumstances there is going to be a rise in working class activity. That is what it looks like. The other possibility some people put forward is that they are just stupid: having adopted monetarism or the ideology of Thatcherism, they really believe in it. They really think that the only way to maintain control is to screw the economy down – therefore they have to cut the fiscal deficit. In other words it is pure ideology – in fact not even ideology, which needs a point of contact with reality. If they are really not thinking of a direct contest with the working class, one can only say that they are mad.

But can they defeat the working class? Well, they are not doing so in Greece quite obviously. Are they likely to beat the working class anywhere? It is highly unlikely. The usual way that they control the working class is through a mixture of repression and concessions, but here there are no concessions – just straight repression. So they are not going to win: I cannot see it. Even most people on the side of the bourgeoisie would probably say they could not win in the end.

So are they trying to commit suicide? On the one hand, they have bailed out Greece, which from the point of the system looks all right; on the other hand, they are imposing austerity everywhere. So where on earth will that lead, apart from downhill? It may be awful for the left in the coming period, with wages going down and unemployment rising, etc. People’s personal circumstances could be considerably worse. But if you look at what is likely to happen politically, people are going to move to the left. They are already doing so and are bound to move further to the left – logically there is no other way to go.


As I have written in Critique, one has to analyse the downturn from three angles. There are the periodical upturns and downturns; there is the strategy of the ruling class; and then there is the crisis of the capitalist system itself.

Firstly, the upturns and downturns, which have gone on for over 300 years. There is a certain automaticity about it, whereby companies sell off or destroy their stocks, reduce their ability to produce, dismiss workers and so raise their profits. We are not in the 19th century, in spite of the stupid rhetoric about small and medium-sized companies. The companies which dominate the economy are large – monopolies, oligopolies or whatever else you want to call them: simply large, dominant firms. Quite obviously their profits will rise; they have risen, sometimes by enormous amounts. Logically it is what you would expect to happen.

So there is something of an upturn depending on the country, but the upturn is relatively weak, because the capitalist class cannot see much of a future, as things stand. Obviously if unemployment is high and wages are static or declining, demand is going to be low, which is what they expected.

But behind it all they are still stuck with exactly the same reason why the crisis occurred: that is to say, an enormous surplus of capital. It has existed now for decades, getting bigger, bigger and still bigger. At the time the crash occurred in 1970 it was somewhere in the region of $18 trillion just being held as liquid assets; that is on top of the $110 trillion being held by hedge funds, pension funds, insurance companies, private equity and so on. So the enormous amount of money in the system dwarfs entirely the crisis of Greece. The banks hold more than all the countries’ deficits combined, so these crises could be dealt with easily in theory. The problem remains the huge level of surplus capital looking for investment. The banks are only offering half a percent interest, which is a joke – if you are lucky you may get two percent. In Britain that is below the rate of inflation, so in real terms you lose your money. But there is no obvious place to invest.

Why is this the case? The answer goes back to the strategy that has been adopted – the strategy of finance capital. This means deliberate disinvestment from industry, switching to the holding of money as money, which is then used for investment in order to get quick returns. There is no interest in investing for the long term. To a degree the money went to the third world – originally to south-east Asia – and that was not successful. Then there was the dot-com boom, but that collapsed; then derivatives, which also collapsed. There is nowhere for that capital to go – except back into industry.

There is a certain move for going back to industry: Mandelson has been pushing that in Britain. He had the crazy idea of linking universities to industry. It was the profitability of everything that counted, so universities had to become profitable and science would be subjected to that. This idea will no doubt be taken up by the Tories – albeit perhaps not in such a crass way – but it cannot work, of course.

The point is that there is a clear tendency to realise that there must be a move back to industry. There has already been a limited amount of investment in China; another example is that of General Electric in the United States, whose latest report notes that investment in finance capital has not been doing too well, and more or less concludes that the company will have to go back to industry. You can expect a certain shove in that direction.

Finance capital

The strategy of finance capital has now failed, along with its political arm – economic liberalism. It continues like a zombie, but as a policy it has failed. The capitalists will have to find something else – but they are muddled and do not know where they are going.

A switch to industry, however, would not provide returns immediately. They would not come for five, 10, or even 20 years. That is why it not easy to switch from finance capital to industrial capital, just like that. The only way it would happen is if the state begins the process. It is being discussed in the United States, but you have to be utopian to believe that Obama will go all the way through with it. In the US there is talk of big investments in the railways and a high-speed rail link.  (According to Scientific American most of what is being considered is just an inferior version of what exists in Britain. Although it would provide some sort of outlet for investment, it is peculiar that the most advanced and dominant country in the world wants to invest in backward technology.)

But it is not clear to me that even this will happen, given where the situation is in the US. The Republicans are opposed to state intervention, and even if some such investment was let through, it would not be enough to start the process. The capitalist class is not prepared to reflate. That would mean full employment, and the working class would start to exercise its power and demand control. This unwillingness to reflate means that any industrial expansion will be limited and they are stuck with finance capital – which is unable to achieve sufficient returns.

From this point of view capital is in a difficult situation. I do not want to say that capitalism’s situation is terminal, however desirable that would be. It will not end automatically. It is in decline, but that will only be terminal when the objective and subjective elements come together. The subjective elements are not yet there.

What can be done?

The predatory, parasitic and inhuman strategy that relies on finance capital has come to a dead end – but we have now come to a point where capitalism cannot solve its own problems. The only alternative rests with the working class. It needs its own political strategy pursued by its own parties. The social democratic and so-called socialist parties will either get absorbed into other parties, disintegrate or become even more openly pro-capitalist, if that is possible. There is no alternative but to move left.

The capitalist crisis in the USA (Mick Cox and Hillel Ticktin)

The speeches were delivered during a seminar at the London School of Economics on February 27 2010 to celebrate the 50th issue of the Marxist journal Critique, of which Hillel Ticktin and Mick Cox are the editorsFor an edited film of the conference, visit redmistfilms.org

Vodpod videos no longer available.

50 issues of Critique

In defence of Leon Trotsky

Hillel Ticktin demolishes Robert Service’s much hyped Trotsky: a biography (Harvard University Press, 2009, pp600, £25)

Bob Service’s book on Leon Trotsky has been very widely reviewed by left and right.

Perhaps one of the best reviews is by Paul Le Blanc (‘Second assassination of Trotsky’ Links – International Journal of Socialist Renewal: links.org.au/node/1440). He makes most of the points necessary in any competent overview: that the book has a scholarly apparatus, with many points that are useful and some that are new; that there is an element of sloppiness in a number of the assertions; and that Service appears to be driven by a political agenda, which is not dissimilar to that of the research institution where he did much of his work for this volume – the Hoover Institution, known for the rightwing views of its scholars.

Le Blanc deals with some of the assertions made over the radio and television: that this is the first full-scale biography of Trotsky, not written by a Trotskyist. That the Russian, Volkoganov, had written a critical biography some 10 years ago is well known, but Service excludes Russians in his written claim to authorship, though not when interviewed on Radio 4 in the UK. It is obvious nonsense and Le Blanc quotes the examples of Payne, Segal and Carmichael.

The book flows easily and keeps the attention of the reader. The reasons, however, are only partly to his credit. Trotsky: a biography is superficial. It has a scholarly form, but is not scholarly, whatever else it might be. Service makes assertion after assertion as to Trotsky’s motivations, Trotsky’s character, Trotsky’s originality, his intellectual competence (not to speak of his ability as a lover) – all without sufficient reference or argumentation.

His fundamental thesis is stated at the beginning – that Trotsky belongs, along with Hitler and Stalin, among the great killers of all time. Trotsky, Service asserts, was a violent man. Secondly, he asserts that Trotsky made a career out of politics, but was a poseur, and an arrogant, cold, would-be leader.

His own description of Trotsky’s history fails to support these theses. He shows how Trotsky turned down Lenin’s offer to be prime minister, and various other prominent roles, and only reluctantly became the commissar for war. However, the one section of the book which is without the constant snide remark and which breaks with the popular Stalinist portrayal of Trotsky, as playing no role, is the section on the civil war, where Service makes clear in some detail that Trotsky built up the Red Army and was pivotal in its eventual victory. He makes even clearer Trotsky’s bravery and his military prowess, citing his importance to the defence of Petrograd.


However, he argues that Trotsky was part of Bolshevik brutality and terrorism. He points to the fact that Trotsky did not countermand Stalin’s arbitrary executions in Petrograd. Given the bad blood between them, there is every reason to believe that Stalin might have disobeyed, as he had before, and so caused a crucial breach at a time when the Bolshevik situation was desperate. While this is only supposition, we cannot lay Stalin’s actions at Trotsky’s feet quite so simply. More serious is Service’s use of Trotsky’s defence of terrorism in Terrorism or communism.

Any scholar reading Trotsky’s chapter on terror in that book can recognise that the use of the word ‘terror’ is not the same as its use today, referring to such terrorist groups as the IRA or al Qa’eda. In the introduction to that book, Trotsky explicitly condemns terror of the latter kind. He had done so much earlier, referring to anarchist groups. Trotsky is using ‘terror’, in the relevant chapter, in the sense of the Russian word ushas, which refers to fear and horror in the first instance. He is arguing that during a period of war, particularly a brutal civil war, fear is a necessary component. He is also saying that since war is war, people are killed and executed, particularly when the regime itself is at stake, and that the whites were particularly brutal themselves.

This cannot be gainsaid. Seventy thousand Jews, alone, were killed in pogroms instigated by the whites. White terror after the Paris Commune, and after 1905 showed what the alternative was. Since then we have witnessed the extreme brutality of the right and the extreme right in many instances – of which, in the post-war period, Greece, Argentina, Chile and, in the case of the British empire, Kenya are good instances. The brutality of the right does not justify the left doing the same and one may hope that it will never happen again. That does not deal with the question, however.

The question that Trotsky posed was whether a war can be conducted as a socialist war, in which enthusiasm replaces hierarchy, and fear and persuasion takes the place of imprisonment and execution. To ask the question is to get the answer. Within capitalism, war is war and socialists can only modify its nature to a very limited degree. At that time, World War I was conducted under the tried and tested rules, which involved shooting deserters, instilling fear into subordinates and into the enemy. Trotsky accepted these rules as the only ones likely to be successful. No-one calls this terrorism, though later generations might well do so.

In short, Bob Service has regurgitated the standard critique of Trotsky, which he has every right to do, but without the necessary scholarly discussion of the issue. Whatever one thinks of the issue itself, Service has totally failed to substantiate his argument that Trotsky was in the same league as Stalin and Hitler. Trotsky did not directly or indirectly order the killing of masses of people, although he did sanction executions and imprisonment. Had he or the Bolsheviks been of that mind, they would have lost the civil war itself.

Historical periods when millions were killed, as under Stalin, were not induced just by one mad man, however brutal and powerful, but by the instability and irrationality of the system itself. Seven million died in the civil war, but one cannot attribute any substantial number to Trotsky himself, though one can point out that without external intervention a fraction of that number would have died.

The Bolsheviks won the civil war, to a considerable extent due to Trotsky’s conduct of it, but the destruction, the massive loss of revolutionary personnel, combined with the exhaustion and inevitable disillusionment, effectively provided the basis of the subsequent Stalinist counterrevolution. The first stages of moving to socialism will always be difficult, but the conduct of a war using capitalist forms of hierarchy both for the army and for the population, in war communism, could only demoralise the population. This is why the left oppositions of the time – the military and workers’ oppositions – were so militant in demanding change.

Ever since the issue has remained open. It is hard to see that Lenin and Trotsky were wrong in that the alternative would have been a repetition of the Paris Commune with its attendant horrific destruction by the right. They took a chance and changed the world. The success of the Russian Revolution, with all its defects, altered the world forever, and it entered a long-drawn-out and bloody transition process. Service, of course, cannot see this, as his book is a pedestrian plod, bereft of ideas, but replete with snide remarks.


At one level, this book is Hamlet without the prince. It tries to go through Trotsky’s life on a number of planes, most particularly his personal life. There is even a chapter on his sexual affairs, including a intimate quote from a letter from Trotsky to his wife on that subject. As with every other aspect of Trotsky, Service discovers him to be self-centred in love too. While this might be salacious and draw people to read the book, it is irrelevant to understanding the man.

This is partly because Trotsky was above all an intellectual, who made crucial contributions to Marxism and to thought in general; partly also because Trotsky became the living embodiment of the Russian Revolution itself. Yet if Trotsky argued this or that or undertook a particular action, Service always manages to find an obnoxious interpretation. If he had done the reverse and always cast Trotsky’s actions in a positive light, he could be accused of being an acolyte or a hagiographer. The point is that any scholar worth his salt would look at all sides and interpretations in order to consider reality. Clearly, however, that is not the purpose of the book.

In this connection, Service discovers that Trotsky was not an intellectual – or at least he was not in the least original and so there is no need to discuss his ideas, as there are none to discuss. If Service were himself a better educated intellectual, there could be debate, but he quite evidently understands as much about Marxism as Winston Churchill or Count Bismarck. Marxism is not easy to grasp, particularly at the present time, and for someone who rejects the whole theory it is probably impossible to understand its analytical power. It follows that such a person could not appreciate the development of Marxist thought. Unfortunately Service tries to tackle the issue by talking of Trotsky, philosophy and Sidney Hook, and of James Burnham and Max Shachtman, without giving the substance of the debate, or apparently being aware that Trotsky had written on Marxist philosophy a number of times in his life prior to this affair.

However, Marxism is above all a mode of political-economic analysis, used as a means of understanding the world, the better to change it. In this light, Trotsky’s contributions were seminal. Amazingly, Service reduces the concept and theory of permanent revolution to the simplistic idea that the workers would take power in Russia. In fact, Marx had argued, after 1848, that the revolution became permanent only when the working class took power. The working class, as Marx put it, were in capitalism but not of capitalism. (One should note that Marx and Trotsky are talking about the collectivity, the class, and not the individual workers.) As a result, there is a permanent and persistent force destabilising the society, the result of which might lead to different kinds of upheavals and to different classes trying to take power, but only when the working class takes power does the society stabilise itself. This is arguing both that the political economic structure of the society is leading to revolution and that the working class is demanding revolution.

Trotsky took this concept and applied it to a part of the world subject to capitalism but without the political forms of capitalism and argued that there was no longer a possibility that there be any other successful upheavals, or attempts at revolution, other than those of the working class. The bourgeoisie were no longer prepared to fight for their own demands. Marx and Engels had got halfway there when they spoke of the German bourgeoisie no longer having a stomach for a fight. The bourgeoisie were afraid that they would let loose the tiger of socialist revolution and consequently they preferred to keep what privileges they had.

At one level, the background of the personnel who took power in the name of the working class was irrelevant (ie, they could be soldiers, or of peasant extraction), as long as they acted in the interests of the class. Similarly, in the English Revolution the class origin of the individuals in the Long Parliament was irrelevant to the class forces that they represented. Trotsky was right against Lenin’s conception before 1917, because Lenin underestimated the necessary cowardice of the bourgeoisie and the short-termism of the peasantry. Trotsky’s understanding undercut the issues, because permanent revolution was not an empiricist notion, but an inherent drive built into the structure of capitalism, which Trotsky had harnessed to the concept of a declining capitalism. The latter was something Lenin made his own, though only by 1917. It was, therefore, not surprising that Lenin agreed with Trotsky against his earlier self.

Permanent revolution applies to the period after 1917-22, in that Trotsky makes two important theoretical innovations. He argues that the social democratic betrayal of 1918-19 opened up a new period of transition between capitalism and socialism. He compares the present to the times of Machiavelli. Secondly, he argues that there had been a counterrevolution in the Soviet Union under Stalin, with a new social group taking power. Underlying it all, the dynamic of a new society pushing its way forward through the medium of the working class remains. The rejection of the exploited goes underground when it cannot express itself openly, and finds new ways of undermining the system. We are therefore living in a period of ever-present revolution, the world over. For Trotsky the revolution had to be systemic and therefore global – he was arguing that the revolution in permanence was itself global.

Others have pointed to Trotsky’s conception of fascism as an important contribution to the understanding of the phenomenon. It is obvious that he was right to demand a united front – unlike the Stalinists, who actually united with Nazis in governing more than one German local state. His theory of fascism was directly contrary to that of Stalinism, which saw fascism/Nazism as the rule of the bourgeoisie by force. Instead he pointed out that it was the rule of the petty bourgeoisie – which the ruling class accepted for a time, though they did not like it. (The lives of two prominent German capitalists, Thyssen and Krupp, supports this thesis. Thyssen supported Hitler, but opposed his policies and escaped from Nazi Germany, only to end up in a concentration camp. Krupp opposed Hitler until he came to power.)

Trotsky’s discussion of fascism is immediately relevant today, in that it makes clear that without Stalinism and a classic petty bourgeoisie it cannot repeat itself. Authoritarianism is another matter. The theory also points to the irrationalism of a capitalism in transition and in decline. This is fundamental to any understanding of the epoch as a whole. Trotsky developed a particular understanding of capitalism and connected it with a theory of long waves. I have discussed this in my book on Trotsky’s ideas, but Service has no inkling of any of it.


It is curious that Bob Service should stoop to character assassination of the most trivial kind. He raises questions of morality in relation to Trotsky’s relationship to his own family members. Thus he asks what kind of man would desert his wife and children in Siberia in order to escape, and then find another partner. He brings in the question of his Jewishness, his relationship to his father, etc – all of which are merely raised, leaving the reader wondering.

The problem here is that neither he nor we actually know much about these issues. If Trotsky’s father was a revolutionary and taught his son how to organise, theorise or live underground, it would be important, but there is no evidence of anything of that kind. We are told that Trotsky played down his father’s social position. The introduction of simplistic psychology into historical narrative is always unfortunate, but Service insists on discovering Trotsky personal faults, arrogance, stubborn belief in his own opinion, etc, as if they are undoubted, continuous and necessary traits of the character.

If Trotsky really was that arrogant it would have quickly ensured the defeat of the Red Army. What is arrogance? He was genuinely the most intellectually and organisationally capable of the Bolshevik leaders – Service makes this clear. Trotsky might well have been contemptuous of those with inflated opinions of themselves. Without a thorough study of his personality by sociologists and psychologists, it is pointless making such a remark, unless the author is intent on a process of systematic denigration.

It is a characteristic of bourgeois scholars that they see the left-right struggle in the 20s in terms of a direct fight, no holds barred, between Stalin and Trotsky. Service tries to argue that Trotsky was no politician and so was an inevitable loser. In fact, Trotsky yielded without any real fight. He was head of the army, he had the backing of Lenin and the Komsomol supported him. The genuine old Bolsheviks supported him. He could have taken power without much trouble. However, he argued that it had to be done democratically through the party and he lost in that arena. Since we know that the voting was falsified, and in any case Stalin had specially opened the party to a wide range of people, with little understanding of the issues, this made no sense.

Trotsky did not lose in any kind of battle: he never fought. He consciously decided that he should not take power in the circumstances. He justified it with the argument that Stalin was made, in what he became, by those who selected him, and he, Trotsky, would have been the same. So, when offered power by Antonov Ovseenko, chief commissar of the army, he rejected it. This issue is very poorly discussed by all scholars, to be fair to Service. However, he takes it up as proof that Trotsky was not a politician.

In American business parlance, part of present-day slang used by historians, Trotsky was a loser. But that is not how Trotsky or any Marxist would look at it. Trotsky did not want power for its own sake: he was a soldier of the revolution and, if it meant that he had to fight as part of an opposition to maintain the revolution, that is what had to be done. He accepted his fate. So much for arrogance.

In my view, with the hindsight of history, Trotsky was wrong. He ought to have taken power. Service, like Trotsky himself, thinks he would have been another Stalin, but that is impossible, if one understands the dynamic of the Soviet Union of the time. With the support that he had, Trotsky would have been able to maintain power for a sufficient time to alter the nature of the regime away from what it was becoming. If Trotsky had taken power, Nazism would not have succeeded, there would have been no world war, the purges would not have taken place, and it is possible that there would have been a revolution or a series of revolutions in Europe and Asia.

Even if no other revolution would have succeeded, and Trotsky would have died as Soviet ruler in 1953, world history would have been very different and almost certainly more advanced than at present. However, no-one could have imagined the utter barbarism to which the world was subjected from then onwards. It was the direct consequence of the Russian Revolution and its subsequent counterrevolution under Stalin. Trotsky clearly hoped that the Soviet left and the Soviet working class would take power and dismiss Stalin.

Unfortunately, Trotsky was not sufficiently arrogant in understanding that he had become the personification of the Russian Revolution itself and his dismissal symbolised the end of the revolution, but in the most objectively and subjectively debased and confusing way possible. The Soviet Union under Stalin was neither socialist nor capitalist, nor yet a transition to socialism. As a result, it was unviable, but like Frankenstein’s monster it had no parent and no future. Its rulers behaved like mad people, caught in a mass of twisted tape in which they became ever more enmeshed. Cutting through the tape – short cuts, in other words – were constantly being tried and invariably made things worse.


Trotsky did not expect the USSR to last so long nor that it would come to an end so easily, so messily and so unsuccessfully. He did say that it could not last in its Stalinist form. He did not understand the nature of the Soviet Union that came into being in the 30s, but then nobody did or probably could have done so. He was always behind the curve of its degeneration. That, again, is understandable, in that he was an optimist, like all revolutionaries. Service tries to make these points but he gets lost in his own need to run Trotsky down.

It is unfortunate that some in the Trotskyist movement have taken his words as dogma. Trotsky was not himself dogmatic, for he is not clear whether the USSR was planned, says that the nature of the USSR is undetermined, and concedes that a social as well as a political revolution is required. Trotsky himself should not be lumbered with the simple formula that planning plus nationalisation makes for a workers’ state, which has then to be critically defended. Service, however, appears as an upside-down dogmatic Trotskyist, as he tries to portray Trotsky as simply insisting on the concept of a workers’ state, and always wanting to defend the USSR.

Trotsky’s initial analysis of Stalinism has stood the test of time – as the seizure of power by the social layer controlling the bureaucracy. That gave them control of the surplus product. Marx, of course, talked of the form of the extraction of the surplus product being crucial. Trotsky was pointing to it, but he did not go any further. Once he lost his historic role, he was no longer in touch with history itself, and his pronouncements reflected that fact. Service, however, misunderstands Trotsky’s analysis and tries to argue that he adopted a Menshevik analysis of the USSR, in order to claim that he was unoriginal. This is simply not true. The standard Menshevik interpretation of the USSR was that it was state capitalist. The Mensheviks could not adopt Trotsky’s position, as that would have meant they were wrong not to have supported the October revolution.

Robert Service, James D White, Ian Thatcher, Geoffrey Swain and various others over time have accused Trotsky of condemning socialism in one country, while practising it. The superficiality of such statements makes one wonder whether it is worth arguing the contrary case. Stalinists, of which Service is not one, have always argued that Lenin wanted to build socialism in the Soviet Union. However, there is no evidence of this, except such as Stalin forged or misinterpreted. The very act of taking power in one part of the world (the Soviet Union was not one country) did imply that the Bolsheviks were establishing a base, and like all bases it had to be built up, fortified, made liveable, etc. Treaties had to be entered into. That has nothing to do with socialism. In so far as such a base was helping the establishment of socialism over the world, even if it got wiped out and was rebuilt, one could talk in loose terms of building socialism. That is not the same thing as saying that socialism was being established in the USSR.

It is ridiculous to argue that the act of rebuilding the ruined Soviet Union in itself constituted a process of building socialism. Obviously the Bolsheviks could not rebuild it as a simple capitalist country either, and that was the tragedy, which facilitated Stalin’s rise to power and Stalinism. It is worth noting that Trotsky explicitly criticised Preobrazhensky, the economic theorist of the left opposition and his close ally until he capitulated, for wobbling somewhat towards the concept of socialism in one country. Preobrazhensky repudiated this, showing the technical impossibility of economic reconstruction without aid. Trotsky, however, was criticising the new economics, but he could just as well have made the remarks of Preobrazhensky’s fantasy of a Soviet Union which is successful alone but then reaches the limits of socialism in one country and takes on the world.

It is not surprising that those who do not understand Marxism also do not understand the meaning of socialism itself. Since both capitalism and socialism are global systems, only a global change is possible. It can begin anywhere, but it cannot sustain itself in any part of the world until socialism has established itself as an historically superior social system.

A superficial historian or writer will take words used at face value, without comparing them to conflicting statements, often made at the same time. This, indeed, is a major fault of this book, in that Service does not look for more than one source when using controversial quotes, and he does not try to dig deeper than that quote. As we know, individuals can say any number of things, or act in a series of ways, but it is the job of the historian to determine what idea or form of action lies at the core of their operation or their being, or if there is none.


Trotsky saved Victor Chernov from the crowd in July 1917, but Service tells us that he only did it to avoid the left being victimised, and implicitly not because he was a decent human being. How does he know that? Could Trotsky really have been so calculating; and for that matter so convincing at the time, without including some common humanity in his speech?

There is almost no paragraph devoid of an undocumented snide remark, reflecting the author’s sustained anti-Trotsky animus. This book probably is unique in producing more personal criticisms of Trotsky than any other. Few of them make much sense, however. As indicated above, we are told that Trotsky decided on the career of a politician. Today when the word ‘politician’ conjures up images of corruption, betrayal of principles, men and women with views for all seasons, etc, it is an insult. However, no Marxist would ever see their devotion to the cause as a career. Politicians do have careers, but it is not a career to be a professional revolutionary, which condemns you to a life of perpetual begging, uncertainty and permanent insecurity. Clearly from the Service perspective Trotsky was an unsuccessful politician in that he lost to Stalin. He was a loser.

Service goes through the years of opposition to Stalin, but he does not seem to understand the nature of that opposition. He sees it as some form of semi-democratic debate. He does not ask why Trotsky bothered with it, since it was so much of a charade. If Trotsky took to reading books during meetings, why did he attend the meetings? Clearly Trotsky hoped that if he hung on, things would change for the better. He may have hoped against hope. The discussions among the left opposition of the time, in the secrecy of private walks or perhaps at home do not exist, but we do know that some at least were less optimistic and saw that the October revolution had suffered a defeat which, together with the betrayal of the social democrats, had opened up decades before socialism could advance again. Trotsky could not have been unaware of this viewpoint.

With hindsight we know that the situation was more critical for civilisation than anybody could have imagined, but no-one could have foreseen the future terrors of Stalinism and Nazism. The only criticism one could make of Trotsky is that he was not sufficiently ‘arrogant’. He was the embodiment of the October revolution – not just as an historical figure, but as a living human being who had internalised its experience and acquired the necessary understanding – some might say wisdom – that went with it. He was honest and sincere through and through, and could never have been bought off, as Stalin was.

He ought to have trusted himself to have taken on the responsibilities thrown at him, first by Lenin as prime minister and then again by Lenin in his ‘testament’, or shortly before he died. The problem of the revolution was that there was no-one to compare with Lenin and Trotsky intellectually, organisationally and in all-round capability, so that Trotsky had no-one else to force his hand, once Lenin was dead. He underestimated Stalin and Stalinism, thinking that Bukharin and the bourgeoisie were the main enemy. While the ultimate opponent was the bourgeoisie, he turned out to be wrong about Bukharin as the primary opponent, partly because of Stalin himself, whose social base formed very quickly.

Trotsky sacrificed his life, all his manifold talents and abilities, to the cause of humanity. He made mistakes and misjudgements, as everyone must do, but humanity had made a giant leap forward at the time of the revolution. Even though we have been partially thrown back, the potential remains and capitalism continues to be fatally injured.

Revolutionaries are made; they are not born. Trotsky and Lenin acquired their understanding and their ability to help the revolutionary tide through involvement in the working class movement. Equally, when the tide moves out, the old leaders are left adrift, and they must necessarily lose some of their old surefootedness. But only a misanthrope will charge them with this or that misstep.