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Ownership, Control and the Market
For many years capitalism was defined in terms of two key elements: private ownership of the means of production, and the existence of wage labour. [*] These conditions gave rise to the existence of surplus value, which, in the hands of capitalists, became capital. From this sprang a definition of socialism, as the expropriation of the capitalists and the transfer of the means of production into common ownership. No longer would surplus labour be appropriated by capital as profit. It would now exist as a social fund to meet common needs. This is how Clause Four of the Labour Party’s 1918 Constitution saw the Party’s objective: ‘To secure for the producers by hand or brain the full fruits of their industry, and the most equitable distribution thereof that may be possible, upon the basis of the common ownership of the means of production, and the best obtainable system of popular administration and control of each industry and service.’ The emphasis here was on distribution. Others put more emphasis on using the surplus for needs-led rather than profit-led investment. But the basic approach was the same. The haunting difficulty lay with the notion of common ownership. As Tawney said at this time, ‘when the question of ownership has been settled the question of administration remains for solution.’  Control could not be exercised directly by all of the people all of the time. The Labour Party’s ‘best obtainable system of popular administration and control’ was evocative but undefined, and certainly far less clear than the daily reality of private capitalist control. The predominant Marxist tradition at this time solved the problem through the concept of the workers’ party. If there was a party composed of workers and representative of working-class interests then it would administer the means of production on behalf of the producers.
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