harry hanson’s arguments (“Socialism And Affluence”, NLR 5) are remarkably like those of Tony Gosland in the October issue of Encounter, though his conclusions are quite different. Unfortunately, while Crosland’s conclusions follow logically from his analysis, Hanson’s are so loosely attached to the body of his argument that they fall off at the slightest shake. He wants the Left to follow the sad example of the ILP, which disaffiliated from the Labour Party in 1932 and has hardly been heard from since. What is more, if his economic analysis is right, the prospects for a breakaway socialist party in the 1960s must be a good deal worse than they were in 1932, at the depth of a shattering world economic crisis.
Nevertheless, the substance of Hanson’s and Crosland’s critique of Crossman deserves serious attention. Is British Capitalism so stable and is affluence so assured as to make an unqualified socialist alternative electorally unattractive? Attention has rightly been focussed on comparative rates of economic growth. During the 1950s the Soviet National Income increased at more than twice the US and more than three times the British rates. Suppose, it is now urged, that such discrepancies persist for another decade or two, does it really matter? “What”, asks Hanson, “is the nature of the beating we are going to take?” He lists some ways in which Soviet expansion may make itself felt in Britain and wonders whether any of them are really significant for our political future.
Of the possible consequences, the “terms of trade effect” is perhaps the most serious in the short run. By the end of the current Seven Year Plan, in 1965, the disparity between the productivity of Soviet industry and agriculture will have increased considerably. Pressure on Soviet planners to develop a really massive exchange of machinery for agricultural products from the non-Communist world will correspondingly increase. In terms of comparative costs there will be an overwhemlming case for putting Soviet
It may be argued that since the main countries of the Common Market have developed, in the ’fifties, at a rate comparable with that of the USSR, Capitalism can hardly be held responsible for Britain’s slow rate of growth. But the conditions in which this has occurred should also be noted. They include: (a) substantial unemployment for much of the period, facilitating rapid growth without too much inflation; (b) massive injections of United States capital; (c) rather more nationalisation and much more state direction of the economy than in the United Kingdom; (d) a lighter burden of military expenditure and overseas investment.
In a very real sense Britain has had, and continues to have, the worst of two worlds. Here Capitalism—in comparison with the Continent—subordinates industrial development to the requirements of overseas investment. And here the Labour Movement is just strong enough to lessen the “flexibility” of a capitalist economy while not yet strong enough to impose a socialist solution. Before long the “demonstration effect” of a standard of living demonstrably and increasingly shoddy in comparison with the rest of Europe will be enough to galvanise a Labour Party that can survive to take advantage of it.
To cope successfully with this range of problems, Britain, in particular, needs to take substantial strides in the direction of social ownership. Even the Tories will move towards social control, but their steps will be halting, inconsistent and, to the extent that they are effective, socially unjust, since Capitalism can only raise the level of investment by increasing the share of profits in the National Income. Keynesian techniques have given Capitalism a crutch, so that it no longer falls flat on its face every ten years. But a crutch is still a pitifully inadequate, not to say anachronistic, means of propulsion.