The Transition To SocialismPublished: 21 May 2016.
Author: Jonathan Clyne (TSN Policy Coordinator).
Intro by: TSN Editor.

Below is Chapter 2 of the first draft of a new book written by Jonathan Clyne entitled ?The Transition to Socialism?. This will form the basis of a discussion at the next meeting of The Socialist Network’s international coordinating committee as part of a process of creating a new Socialist Manifesto.

For this discussion around the book we wish to encourage the widest participation and feedback from members of the Network and the socialist movement in general.










The complexity of its Structure

The ruling class sets the political agenda and stakes out the direction of society. Otherwise, it would not be the ruling class. Only in exceptional circumstances do other classes have a decisive say. However, the power of this ruling class does not depend just on its objective strength, but also on its ability to project the image of a powerful, unified and justified social force. As such, to describe the ruling class just as a tiny super-rich elite served by a layer of top company directors, power-hungry politicians and media moguls is not sufficient. Without understanding the direction in which the ruling class are taking society nor understanding why they get broad support, and how they can lose it, means that we will always be a step behind them. To avoid this, any appreciation of the shape of a future new society must first begin by examining the existing society and its ruling class.

The roots of capitalist power reside in property rights. One of the main strands in modern mainstream economics, New Institutional Economics, argues correctly that property rights are of decisive importance for the functioning of the economy. That is what gives capitalists the right to profits. Property rights are not the same thing as personal property. Any lucky person with a lottery ticket who collects a fortune soon understands that they can buy fancy cars, luxury trips, and expensive houses, but sooner rather than later, their money will run out. They need to use their newfound wealth to purchase property rights over the means of production, like shares and businesses, if they are going to have a continuous income for the rest of their lives. Only then can their money accumulate, i.e. become capital, rather than being frittered away. Property rights give one the right to do what one wants with the means of production – machines, factories, land, and raw materials. In order to survive workers have to sell their labour power to those that have these property rights.

Hierarchical Structures
Hierarchical structures are the means whereby power is transmitted within a system where property rights are restricted to a minority. The top commands those below. The choice of those below consists of obeying or, when possible, leaving one hierarchical structure for another. Within each organisation, the chain of command is clear. Everybody knows who commands him or her and who the top commander is. Competitive struggles frequently occur to determine who rises to the top. These can have debilitating effects upon the whole organisation, even destroying them, but the basic chain of command normally remains in place.

However, there is a struggle for power and heirarchy between the different hierarchies. After all, capitalist production is based on competition. While this introduces dynamism it also creates instability and conflict in the system ? within competition the success of one is at the expense of others, often destroying rivals in the process. Linked to this there is a competitive struggle within and between hierarchies as combatants organise themselves into networks to further their interests. In these networks the elite implicitly or explicitly promise to support each other based on belonging to the same family or clan, having grown up in the same school, living in the same neighbourhood, working within the same organisation, belonging to the same club or mixing within the same social circles. The prime purpose of such socialising is not pleasure, but as a means of informally projecting oneself, assessing the status of others and developing contacts and loyalties. Common codes of behaviour and expression are learnt from an early age. Sometimes bizarre rituals, like with Cameron?s pig (an alleged club initiation involving the Conservative British Prime Minister in his university days), are used to cement bonds.

The capitalist class has the economic power but economic power is not the only form of social power. There are other key elements of power – military, political, judicial, and even ideological. The ruling class are all those that have such social power. Normally, but not always, economic power lies at the centre of social power because it provides the material base for the other sources of social power. All those that are part of the ruling class are dependent upon each. There is a division of labour between them, which enables them to collectively rule. Each part is needed, but they are also often in conflict with each other about who is most important.

There are networks within each source of social power, but also between them. Networks overlap and are organised in an informal hierarchy. Certain networks are more powerful than others. Old privilege is better than new. Old privilege has cemented networks over a longer time and knows the tricks of the trade better than the nouveau riche, the upstarts. Money is more important than culture or knowledge based networks. Greater wealth is more important than lesser wealth. The fantasy sums that many CEOs pay themselves ? 4-500 times what their average employee gets ? has little to do with their performance but is a symbol of their prestige and ego. For them it is a badge of success, a badge that signals that their networks have more say than others in the hierarchy of networks.

Conflicts Within The Ruling Class
Conflicts are the norm within the ruling class. Only in exceptional circumstances is the elite unified. Alliances of different parts of the ruling class are continuously being created and destroyed. In times of crisis and heightened fear, the pace increases. Strange bedfellows become commonplace. One day the US builds up al-Qaida. The next day it is singled out as the main enemy. One day Obama can be as elected as a Democrat with a platform which included opposing the CIAs torture programme. Then he connives with the CIA to illegally break into the computers of the Senate Committee run by fellow Democrat Dianne Feinstein in order to undermine its investigation of the same torture programme. And then successfully contrives to prevent the Committee?s damning report from being published.

Unlike in the earlier era of absolute monarchy, the system through which power is exercised in a modern capitalist country is full of gaps and inconsistencies. However, it has one great advantage over all other ways in which a minority has ruled over the majority in the past. It is a self-regulating and flexible system unified by the drive for profit maximisation. Within each hierarchy there is a competitive struggle to maximize ones income and one?s prestige – the main criterion by which success is measured.

While this drive for profit maximisation prevails within its ambit positive actions to improve the world can slip through. Or an aristocratic name can rank highly, independently of the means that the name-bearer has at his disposal. A niche for peaceful existence between some hierarchies can appear. However, the drive for profit is a force that is beyond the intentions and control of the individual participants. For most of the time the game of competition, prestige, income, and networking has to be played. The alternative is to be on the losing side and to begin to slide down the slippery slope.

The system breeds corruption and conspiracies, including criminal ones. Regular exposure of such conspiracies at the highest levels show how far some of the actors are prepared to go. These revelations can shake the system. But power is not dependent on corruption and conspiracies. The self-regulation of the system by the drive for profit maximization makes it adaptable.

In the nineteenth century there were few hierarchies and their scale and scope were relatively small. The owners of the mines, the textile mills, land and the banks could be clearly identified. Most workers physically and directly experienced their presence. However, as the economy and society develops, more hierarchies take their place in the competitive struggle. When a hospital expands from being a doctor and a nurse to being an organisation with thousands employed, the position at the top acquires a different character than it had before. The commander becomes simultaneously involved in establishing and defending his or her own privileges while struggling for resources from other hierarchies.

Such hierarchies have appeared in almost every field of human activity ? school, leisure, culture, media, health care and so on. Their multiplication and expansion makes it more difficult to identify the ruling class, a class which despite conflicts within itself, has power collectively that it uses for its benefit at the expense of most people.

The Role of the State

The state in the competitive world of capitalism is assigned the task of drawing up the rules of the game and enforcing them in order to prevent the hierarchies from tearing the whole of society apart. At times, the state can be relatively strong in relation to business and impose its own agenda. At other times, the state and its regulations are weakened and reckless individuals and groups acquire more space for their destructive schemes. Such a situation contributed to the collapse of the world economy in 2008. As right-wing economist Jeffrey Sachs put it after the crash: ?What has been revealed, in my view, is prima facie criminal behaviour? It?s financial fraud on a very large extent.? He described the behaviour of America?s financial sector as ?pathological?.

Indeed, the state itself can begin to crack under the impact of increased conflicts between different elites. For example, in the aftermath of the 2008 crisis discussions about the US budget were paralysed. The USA came close to a default on its debts, which would have wreaked havoc throughout the world?s financial system. This inability to reach a compromise in time lead to almost 1 million government employers being sent home without pay with considerably more than a million others forced to turn up at work without knowing if they would be paid. Naturally, it was the powerless who paid for these conflicts among the powerful.

While each side claimed to represent ?ordinary people?, the opinion polls spoke clearly. Six years after the beginning of the Great Recession, only 29 per cent had ?a great deal? or ?quite a lot of confidence? in the US Presidency, and a mere 7 per cent expressed the same sentiments about the American Congress. Figures for most other parts of the ruling class were not much better: 21 per cent for big business, 18-22 per cent for the media, 26 per cent for banks, and 23 per cent for the criminal justice system.

The bitterness in the American budget struggle was not a result of conflicts among broad-based groups. Research by academics concluded that ?economic elites and organized groups representing business interests have substantial independent impacts on U.S. government policy, while mass-based interest groups and average citizens have little or no independent influence.? Such a situation reflects the weakness of the working class and its labour movement – the weaker a labour movement is the more the conflicts within the ruling class creep into the state itself.

In Pakistan, the state is close to cracking up altogether. On one side is the fundamentalist drug and weapons smuggling elite (originally created by the United States to combat the Soviet Union in Afghanistan). On the other side is the ?whiter? economy. Each side is in turn subdivided and in conflict with each other. While every side is laying claim to a part of the state apparatus.

In catastrophic situations, the central state can be entirely pulled apart by different sections of the ruling class (usually aided and abetted by competing foreign powers). Their networks then turn into warlord?s gangs. In these ?failed states?, the electricity grid collapses; roads fall into disrepair; drains become blocked (and often contaminate fresh drinking water in the process); schools close down; and healthcare becomes a distant dream. There are no laws, no courts, and no administration. Those with the guns call the shots ? openly and without shame. Warlords compete to rape and plunder the population. And secure rich pickings by supplying raw materials to legal or illegal big companies in the developed world: coltan from Congo to mobile phone producers; opium from Afghanistan to the mafia.

IMF Imposed Austerity
The IMF Structural Adjustment Plans during the 1990s often led to failed states when deregulation and privatisation displaced a section of the ruling class from the table of plenty. Similarly, armed foreign intervention in Iraq, Afghanistan, and Libya deprived a sizable section of the ruling class from power and resulted in the chaotic armed struggle of contending rulers. Many in the leadership of ISIS are army officers sacked after Saddam Hussein was deposed in Iraq.

The greater the brutality of a gang, the greater the chances of success, whatever religious or ethnic garb the gang wears. Just like Company Executive Officers demand the highest wages in order build themselves up and intimidate their rivals, gang leaders like to be portrayed as the most ruthless. After five million deaths in the most murderous war since World War II, a degree of stability was created in christian Congo Kinshasa under Congo President, Joseph Kabila, who had formerly been head of an army that included some ten thousand child soldiers. In a similar fashion, the viciousness of the Taliban in Afghanistan and ISIS in Iraq and Syria has succeeded in establishing their rule over large areas. However, the stability they imposed through violence is easily disrupted by foreign intervention. When foreign powers cannot impose their own solutions they often settle for less ? keeping a balance between contending forces. This leads to endless wars. This has been Obama?s strategy in the Middle East since direct NATO intervention in Syria was prevented by a popular outcry. Divide and rule prolongs the disaster for civilians.

The tendency towards the state being pulled part is inherent in its structure. The state itself is divided into different hierarchies. Here, as much as in business, the top commands everybody below it. The commander of each state institution has their own interests and agenda to look after and to network accordingly. When fear increases, a state institution can rise above others and try to stamp their own agenda on society. Sometimes it can be the judiciary that takes the initiative, like in the struggle against the mafia/Christian Democrats in Italy in the 1990?s. Or the military can over-rule others to restore order and stabilize all hierarchies.

Normally all bow down to the most powerful and the wealthiest. But when the capitalist class is weak even the wealthy can be lashed out at. In 1960, after Park Chung Hee took power in a military coup in South Korea, he arrested 24 leading business leaders for corruption. The head of Samsung only escaped because he was out of the country at the time. They were released after paying fines and agreeing to follow the government?s economic development plan. That was the starting point of the South Korean economic miracle.

Universal Suffrage
When universal suffrage ? voting in elections for all adults – was introduced just over a century ago, it was only after much resistance from the ruling class. Power, instead of running from the top down, was at least in theory to move from the bottom up. Instead of a minority commanding, a majority was to decide. Since then formal democratic rights have spread, not least at the end of the 20th century. Yet, parallel with the spread of democracy in later years, trust in politicians has declined, reaching abysmal levels. Despite being able to vote, few people feel the elected represent them and implement the policies that they want. Instead, policies favouring the most powerful elites are pushed through. During the economic collapse of 2008, the wealthy owners and CEOs of the banks were given trillions of dollars. Meanwhile, ordinary families were not protected against foreclosures, wage cuts, unemployment, and cuts in public services.

Using a combination of media manipulation, massive lobbying, campaign finance and generous offers of consultancies and board membership to politicians, the capitalist class ensure that its will is implemented by the supposedly democratic institutions. Bribes are combined with bullying. And if the elite does not get what it wants, it threatens to damage the economy by taking its business elsewhere. Thus, informal pressures overcome formal democratic structures.

Moreover, bought, bullied and hemmed in by the state apparatus and by those with the economic power, politicians twist and turn, promise and betray. As the crisis deepens and politicians are less and less able to deliver, only the most career-minded, those with the thickest skins, the most deceptive and those hungriest for the wealth that accompanies politics are prepared to enter the electoral race. No wonder people get disillusioned with politicians. The very concept of democracy is undermined.

Protecting The Rich Against Democracy
However, it is not only pressure from the outside that undermines democracy. As James Madison, one of the Founding Fathers of the USA, expressed it, the state itself must be designed to ?to protect the minority of the opulent against the majority?. To protect property rights. In most capitalist countries the means to achieve this is the separation of powers within the state into a legislature (a parliament charged with making the laws), an executive (that implements the laws), and a judiciary (that interprets the laws). Only the legislature is directly elected by a majority vote. In this way, democracy is decisively circumscribed.

In such a system, the judiciary has a wide leeway. For example, while the US constitution proclaims that ?The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated.? this was viewed as being perfectly compatible with slavery. Slaves were simply interpreted as not being people. In Germany, most of the same judges and prosecutors remained in their positions before, during, and after Nazi rule.

The judiciary is not elected, although it is subject to some control by an elected political system. In the USA, the Supreme Court judges are appointed by the government, but for life. Promotion in the judiciary proceeds through a hierarchical system. The ability to climb in such a system is connected with habits and contacts developed in privileged networks.

Class also plays a role when one is accused of a crime. Legal aid for the poor is often available in developed countries, but a court appointed lawyer is less likely to have the qualities that judges appreciate compared to a team of top-notch and expensive lawyers. Nor are the same penalties applied to the rich. In so many different ways the judiciary serves the ?opulent?.

The Autonomy of the State
The state can have various degrees of autonomy from the capitalist class. That was the pre-condition for the establishment of capitalism. Capitalism first arose in England, because it was the first place where the landlord class was separated from the state. In feudal times, the lord of the manor, through his control over the means of violence, extracted surplus directly from peasants. When the state secured a monopoly on violence, the landlords had to turn to the market in order to make a living. An agrarian capitalist class was created. The enclosures, stretched out over hundreds of years, forced the peasants to turn to the market to sell their labour power in order to survive. They became workers. With both capitalists and workers in place, agrarian capitalism took off. Later it transformed itself into an urban capitalism that led to the industrial revolution.

The division of labour between the state and ruling class is unique for capitalism. No other ruling class in history has been as reluctant to directly take charge of the state. The capitalist class depends on the market for its income and has to spend most of its time insuring that it is successful there. Support is needed from the state, but that is not where money is earned. Rather, the state is an expense that the capitalists would rather do without.

At the same time, the capitalists need the state. No other ruling class has had so many internal conflicts. These arise out of the very essence of capitalism ? competition in the market. Capitalists cannot trust each other and therefore have to hand over governing to people from other backgrounds ? aristocrats, lawyers, journalists, and professional politicians. For capitalism to function well, the state has to be relatively autonomous. The feudal lords were a class with a rigid hierarchy. In the capitalist class the situation is more fluid with everybody is competing with everybody else. The state therefore has to keep competition within well-defined limits.

The state can only achieve such autonomy if the balance between class forces is right. Capitalism originated in England as an agrarian capitalism because the monarchical state could balance between the landlords and the peasants. Sometimes it supported one side and sometimes the other in order to maintain the power of the state.

During the economic upswing following the Second World War in Western Europe and its off-shoots, the state balanced between a well-organised working class and a capitalist class on the defensive. Due to the pressure of democracy on one side, and informal links to the ruling class on the other side, the state underwent a bureaucratisation. This was a relatively positive development. A brutal and arbitrary use of power was replaced by a rule-based regime. The state became a patriarchal authority dispensing benefits from the top. However, economic power remained in the hands of the capitalists, and the bureaucracy proved a substantial hindrance to workers having a decisive influence, as individuals and collectively.

The State is Not Independent
Autonomy is not the same thing as independence. The state cannot exist outside of the capitalist mode of production on which it is based. As such it is the ultimate guarantor of property rights. As long as the state maintains its chains of command, it will be used by the tops to defend the system against those that seek to change it.

There was every reason to criticize the way the state functioned in the post-Second World War period, never mind in earlier times. However, what came after the defeat of the working class in the seventies and eighties was significantly worse. As a result of the increasing corruption of the democratic institutions and the privatisation of more and more public bodies the revolving door between positions in the state and in business greatly extended itself. This inevitably brought the conflicts within the capitalist class into the state apparatus itself.

Paradoxically, at the same time a vast ?hidden? state sector has been created during the neo-liberal epoch, above all in the USA. Neither politicians nor business leaders talk about it but the state has increasingly taken charge of scientific research and development and then hands it over more or less free to capitalists. Workers pay taxes to finance this.

Likewise, big companies are allowed to keep their money in tax havens. From its bureaucratic autonomous status, the state has been transformed into a body that extracts taxes from workers and hands them over to business. Not only is this unfair, it is dangerous. It introduces the conflicts of the capitalist class into the state apparatus, as they struggle to utilise different parts of the state for their own purposes. It is the first step towards failed states even in developed countries.

In developing countries, the strain of neo-liberalism has produced another phenomenon that is simultaneously leading to an integration of business and the state and the disintegration of both into conflicting entities. The neo-liberal agenda of demanding an end to high taxes, cuts in state expenditure, privatisation and the payment of interest in full to international agencies, has starved the state of resources. To fund itself the military has gone into business. In Egypt and Pakistan, up a third of all businesses are owned and run by the military. To use the state as a transmission belt of tax payers to big business, conflicts with neo-liberal ideology. However, ideology is not there to present a truthful and consistent view of the world but rather to maintain power and privilege.

To Rule, the Ruling Class Needs an Ideology

When a minority rules over the majority, slave revolts, peasant uprisings and worker?s struggles tend to arise. Means must be found to counter-act this. Straightforward repression is not enough for this purpose and ideology must be produced to justify the repression. Understanding ideologies and the role they play is vital for understanding history, and how to change it. Simply condemning ?neo-liberalism? as a bourgeois trick to fool the workers, or calling the latest ideology of ?neo-traditionalism? as racist or fascist, cannot defeat these ideologies. But understanding them can begin to.

Ideologies are not based on logical analysis in which reality is examined and re-examined from as many angles as possible in order to reach a deeper understanding. Ideologies are essentially a form of storytelling. They tell a story about how the world is thought to be that tries to relate to the emotional needs of the listener. The story can be ?we are weighed down by bureaucracy and must free ourselves from the state?; or ?immigrants are destroying our culture and we must stop them?. The first story appeals to the feeling of lack of freedom, which is a very real thing under capitalism. The second to the feeling that things are getting worse and communities are breaking up, which is also true. Anecdotes and statistics are torn out of context in order to illustrate and strengthen the story.

Ideological stories serve both to hide the real power relations in society, but also to give an illusion of empowerment: ?I am a champion of freedom by favouring privatisation?; or ?I am part of a great nation and I have a part of everything that anybody in that nation achieves or has ever achieved?. Without such appeals to large groups of people ideologies are useless.

An Ideology Needs Idols
An ideology?s story-telling also need idols – people, removed from their context, emptied of the quirks and problems that are part of their humanity, and served up as representations of an ideology?s values. By putting a picture of an idol on the wall and worshipping it, a follower can acquire part of the idol?s characteristics, raising them above the surrounding reality. While they cannot hope to match their idol?s achievements it can help them to accept their own inadequacies. In this way, it encourages individuals not to get ideas above their station, or to protest at being low down in the hierarchy. Thus, idols reinforce hierarchies. As Brecht wrote, ?Unhappy the land that is in need of heroes.? In a society where there are no hierarchies, there will be no need for idols.

The Institutions that Transmit an Ideology
Special institutions are created to transmit ideology ? churches, schools, think tanks, the press, TV, and film. Politicians absorb ideology produced there and contribute towards its development.

Ideologies are seldom the conscious products of the ruling class, nor are they most likely to be the products of ideology transmitting institutions. The capitalist class is too busy making money, and the institutions are too busy transmitting what has been the established ideology. Instead, it is left to isolated individuals and groups to work on developing ideas and propagating them. In this market place for new ideologies a few make it, while most remain on the side-lines or disappear. Each ideology struggles to become the one that most suits the needs of the day.

Initially, new ideologies will be ignored by capitalists and derided by the ideology transmitting institutions. This allows ideologues to portray themselves as anti-establishment, through which they gather more popular support. If the old ideology proves bankrupt, a new ideology can gain sufficient popular traction by latching onto the new feelings created by events. Then, the capitalists will change their attitudes towards the new ideologies and will call the leaders to them. In exchange for supporting the new ideology, they tell them to tone down some anti-establishment parts of the ideology. This then filters through to the institutions who give a different slant to how they treat the new ideology.

The Example of Hitler and the Nazis
Such was the case even with Nazi ideologies in the 1930s. Hitler?s rhetoric was primarily nationalistic and racist, but was also directed against big business. The party called, among other things, for a redistribution of wealth, and put up posters showing a Nazi worker about to crush ?international high finance?. In 1927, the prominent industrial magnate Emil Kirdorf, had a meeting with Hitler and outlined his misgivings. Hitler assured him that the anti-capitalist messages were only intended as a means of gaining popular support, and would not lead to any action. Kirdorf then proposed that Hitler write a pamphlet that could be privately distributed among the leaders of industry, describing the Nazis? actual plans for the economy. The result was The Road to Resurgence, in which Hitler gave assurances that he supported private enterprise and was opposed to any real transformation of Germany?s economic and social structure. Kirdoff circulated the pamphlet among his powerful friends. As a result, they were delighted. Huge sums of money were pumped into the Nazi Party, and its SA and SS wings.

There is no immediate confluence of interest between the capitalist class and the ideology transmitting institutions. The institutions are tied into their own hierarchies and networks. They are subject to competition. While some may have independent means most are dependent upon sources of finance such as sponsorship, government support, or advertisers.

Different institutions and parts of institutions can be pushed in diverse directions, depending on the balance of power in society. From being a bastion of reaction, the Catholic Church moved into deep crisis and re-emerged with Pope Francis, its most radical pope ever. Within every institution, there is also a conflict between the tops and the lower downs of the hierarchy.

The Role of the Media
Sympathetic journalists can, at least in some papers if the struggle is very popular, get articles published that are supportive of workers struggles. On the other hand, at decisive moments, like in the run-up to the Iraq war, the one-tone chorus of the institutions can be deafening.

The internet has made it easier to bypass mainstream media, although it also has a big place there. Even without the internet, the role of the mainstream media should not be overestimated. When ideologies have vitality, then the media can weave their story and make it credible. However, when ideologies break down because their conflict with reality is just too big, then it makes no difference what the media says. In the Greek referendum, the whole establishment and almost all of media were strongly in favour of a ?Yes? vote to the Troika?s memorandum. Despite that over 61 per cent voted ?No?. In Greece the printed word was hardly trusted at all.

Traditional Pillars of Ideology
After the turmoil of the two world wars the 1950?s re-established the traditional ideological pillars of the ruling class ? religion, the nation, and the family. These were combined with ?reformism?. All this was made possible by the rapid development of the world economy. This was regardless if a country had a social democratic or a conservative government.

Traditionalist ideology was fragile, at least in the developed world. The capitalist nation had its heyday during the late 19th century, and the first half of the twentieth had experienced economic depression, fascism and two catastrophic world wars. The new welfare state weakened the need for the maintenance of extended workers? families as economic units. Joint-stock companies did the same job for the bourgeois family as uncertainty about inheritance no longer risked the destruction of companies. Religion which had been rooted in peasant society increasingly came to be seen by many as irrelevant to the modern urbanised world.

In the developing world, the family still had a strong material base, but economic development was undermining it even there.

After decades of successful struggles and rising living standards, a strong self-confident working class demanded that dictatorship at work be eased. A youth movement, chaffing at the restrictions of traditionalist ideology, rose up in the 1960?s and then connected with worker?s struggles. This was the significance of Paris ?68 and the Italian ?hot autumn? of 1969. Inspired by these events there were similar movements internationally.

In the movement against the Vietnam War, young activists and workers found a common goal. Contrary to the myths of the time, it was the US working class that was most critical of the war – a 1971 poll showed that while 60% of Americans with college degrees were in favour of an American retreat from Vietnam, 75% of those with only high-school diplomas supported a retreat. Those without any school qualifications were even more in favour of an end to the war.

Enter Neo-Liberalism
Fearing an overthrow of the system in the late 1960s and the following decade, a new ideology was needed by the ruling class. That ideology turned out to be Neo-Liberalism. The new ideology needed to incorporate the driving forces of the revolt ? freedom, equality, internationalism ? and at the same time provide a justification for cutting back the public sector and restoring profits. The call was answered by a marginalized Austrian economist, Friedrich von Hayek, and a semi-popular science fiction writer with mainly bad reviews, Ayn Rand. These became the figureheads of the new ideology. Freedom from oppression was re-interpreted as freedom from public ownership. Equality as everybody?s equal right to succeed or fail in the market, regardless of sex, race, nationality or sexual orientation. Internationalism meant the free movement of capital and commodities across borders.

Neo-liberalism effectively began in 1947 with the establishment of the Mont Pelerin Society. Von Hayek gathered thirty-six scholars in a small Swiss Village to create an organisation that was both a discussion forum and a grouping for political action (the meeting was financed by two Swiss banks who had helped the Nazis steal wealth from its Jewish clients). During the 1950s the new society only grew slowly but from the 1960s onwards it started to get backing from right-wing American industrialists looking for a way to roll back the post-war power and gains of workers. With this support it was able to establish a ring of think tanks churning out policy proposals. The world economic crisis of the early 1970s proved the crucial turning point with leading figures and politicians such as Margaret Thatcher and then Ronald Reagan adopting the Neo-Liberal analysis and programme. Then it became the dominant ideology of the ruling class from the eighties until 2008.

As a theoretical framework Neo-liberalism was a sham, pretending to be a liberating programme favouring small business and competition, while actually helping to entrench big business and transfer wealth from the majority to the rich. But it appeared to work for a while, at least in the developed world where it did not lead to immediate economic disaster, just a slow grinding down of most people?s lives, interspersed with some growth, that went on until the collapse in 2008.

The new ideology even struck a chord among progressive layers. The organisations that people turned to in order organize social change, like worker?s parties and trade unions, were themselves riddled with authoritarianism and bureaucracy, as was public ownership. Many became disillusioned in these organisations. Most became passive, but a layer embraced neo-liberalism as a way forward, charging it with a new energy.

Austerity in the Developing Countries and the Rise of Fundamentalism
In the developing world, things were very different. In many countries, the neo-liberal agenda imposed by the IMF caused the rapid dislocation of the economy and widescale hardship. In response, a section of rulers began to search elsewhere for an ideology. This appeared in the form of Fundamentalism, a resurrection of the more poisonous forms of religion, the nation or tribe or sect, and the family, in order to find a means of getting people behind them. The collapse of the Soviet Union speeded up the process globally. The more extreme the material conditions, the more virulent the fundamentalist prescription. Islamic, Hindu, Christian and Jewish fundamentalism flourished. Even the pacifistic Buddhist religion has become infected by aggressive fundamentalism trends- in Myanmar, led by a Buddhist monk, mobs have slaughtered women and children from the Muslim minority. The minority was designated the most persecuted minority in the world by the UN. More than 240 Muslims were killed and an estimated 250 000 forced to flee their homes.

Neo-Liberalism Falters
To advance, an ideology must hold a promise of overcoming the problems that the previously dominating ideology has created. Neo-liberalism succeeded because it promised to overcome bureaucratic stagnation and provide freedom and opportunities for everybody. Delivering on these promises proved more difficult. As public services were cut, resources had to be put into pressing more out of those that remained. Control mechanisms were geared up and bureaucracy expanded in social security, the health service and education. Freedom and opportunities turned out to be a precarious existence for all but a narrow privileged segment of the population. Neo-liberalism was tearing the fabric of society apart, consciously reducing everybody to the level of competing individuals.

When neo-liberalism failed to deliver on its promises, it began to lose steam. Then, the economic crisis that began in 2008 struck. It was at least as severe a shock to neo-liberal ideology as it was to the economy. Neo-liberals in the US government and the Federal Reserve Bank ended up forcing through the biggest government intervention into the economy since World War II, in complete contradiction to their own ideas. Out of this debacle, a period of ideological confusion and conflict emerged. Neo-liberalism, conservative nationalism, state interventionism and fascist ideologies have been rehashed and combined in all kinds of combinations. Different parts of the ruling class are financing and supporting various groupings.

The Emergence of Neo-Traditionalism
A new capitalist ideology is now needed as a successor to neo-liberalism. This is now known as ?Neo-Traditionalism?. Like the older ideology of Traditionalism it has to offer the security of the family, religion, and the nation. But it has to appear relevant to present day reality. Thus, it is being to be presented as a struggle of civilisations. The Christian West against the barbaric Islamists. Thus these two reactions against Neo-Liberalism, Fundamentalism and Neo-Traditionalism, feed off each other.

The success of an ideology is not dependent upon logical consistency nor having deeper roots in reality. In the fifties and sixties mainstream traditionalism (or conservatism as it was often called), was forced to co-exist with reformism, due to working class pressure.

Similarly, Neo-Liberalism which championed the reduction of state intervention in the economy ended up having to plead for a massive state intervention in the economy in order to save big business from the 2008 economic crash.

Now, a new epoch is opening up for traditionalism combined with both elements of neo-liberalism and fascism – the national culture can encompass blacks and Jews and Muslims as long as they give up their own culture. This idea combines neo-liberal identity politics (?you can choose your identity?) with fascism (?fear what is not part of the nation?). The neo-traditionalist idea of culture is also contradictory. The ?murderous raping culture? of Islam is counter-posed to a national culture consisting of admiring past massacres and rapes committed in the name of the nation.

Neo-Traditionalism is gathering support from diverse social strata that are in conflict with each other. Just like fascism of the 1930s, small businessmen are overrepresented among the supporters of the neo-traditionalists. Likewise, unemployed young men, misfits and oddballs from all classes. The fascist brigades of the movement are most likely to come from these layers. They glory in dreams of being the master race to compensate for their own inadequacies. The leaders of the neo-traditionalist parties try to keep them at arm?s length, in order not to drive away their wider base of support. This wider support comes from different parts of the working class. Most are neither fascists nor racists. The common anti-immigration agenda brings these disparate supporters together. The presence of viciously racist, even Nazi, elements in the neo-traditionalist parties does not transform these parties into fascist parties, but it makes them full of conflicts. The leadership tries to keep control over these conflicts by expulsions and an authoritarian regime, which only exasperates the problems.

Despite differences of interests, Putin, and the Hungarian regime, with its severe restrictions on freedom of expression and organisation are the heroes of many neo-traditionalists. Even while they oppose Putin?s role in Ukraine and Syria, they admire him for doing for the Russian nation what they want to do for their own nation. The French National Front even accepted money from Putin?s emissaries. Authoritarian nationalism is the logical conclusion of neo-traditionalism.

Neo-Traditionalism not yet the Main Ideology
Neo-Traditionalism has not yet become the main ideology of the ruling classes internationally. The exception is Russia and Eastern Europe, where there have been decades of deep crisis since the end of communism. In the USA, the Tea Party has taken over a large part of the Republican Party. Donald Trump used to be a liberal Democrat, but latched on to neo-traditionalism to further his presidential ambitions. In Western Europe, the Front National in France, UKIP in Britain, the Danish People?s Party, the Austrian Freedom Party, and the Sweden Democrats have been relatively successful. The Sweden Democrats even had secret discussions with the main capitalists, which led to them advocating the banning of sympathy strikes, dropping their anti-privatisation demands, and supporting the budget of the traditional main neo-liberal party in parliament. And suddenly, most other parties adopted much of their anti-refugee program.

Some capitalists believe that neo-liberalism can survive. They would prefer that, as neo-liberalism is the natural ideology of big capital. However, neo-liberalism has lost most of its earlier appeal, while reformist traditionalism is out of the question during an economic crisis. Neo-traditionalism could re-establish a social base that supports the system and become the dominant ruling class ideology. The ruling class and the neo-traditionalists will agree to stigmatize refugees and immigrants, treat them inhumanely, push down their existence level to just barely above the places they are fleeing from, and deport some. They will retain most, if only in a semi-legal position. Thereby, the capitalists can get cheap labour, while pandering to nationalist sentiments.

The neo-traditionalist social base will be weak compared to past social bases of the ruling class. Fascism rose to power because it had the support of the peasantry and frightened urban small businessmen. Together they were more than half the population. Today they are a tiny minority. In Germany, the working class overwhelmingly opposed Hitler and supported either the social democrats or the communists. In 1933, all parties, except the Social Democratic and Communist Party, voted in the German parliament to give Hitler dictatorial powers. In the last free elections to the factory committees, held after Hitler was given power, only 3 per cent of the workers voted for the Nazis. Unlike the peasant and middle class that supported the Nazis, the neo-traditionalists working class base will not accept the attacks upon the working class that neo-traditionalists will seek to undertake in collusion will big capital.

In addition, Hitler welded together the SA and SS as semi-militarised forces with 300 000 living in barracks and under his direct control. It gave him an independent power base. The neo-traditionalists will not have that.

The neo-traditionalist social base will do for the ruling class or at least a section of it, until something better for them comes along. The neo-traditionalists offer security and order for big capital against the threat of chaos and disintegration of the nation states. The price will be greater protectionism and the disintegration of international trade, leading to even lower growth. Neo-traditionalism is not the favourite choice of big capital, but if the alternative is chaos or socialism, they will support it.

The Ruling Class and their Fears

In October 2008, shortly after the bankrupty of Lehman Brothers, Alan Greenspan said “I made a mistake in presuming that the self-interests of organizations, specifically banks and others, were such as that they were best capable of protecting their own shareholders.” He added: “I have found a flaw. I don’t know how significant or permanent it is. But I have been very distressed by that fact.” Greenspan was then pressed by the chair to clarify his words, -“In other words, you found that your view of the world, your ideology, was not right, it was not working.” To this Greenspan replied, “Absolutely, precisely. You know, that’s precisely the reason I was shocked.”

Normally, any signs of fear in the ruling class are kept well hidden. How to project the right image to the outside is something instilled from birth in ruling families. Not a chink must be left open; emotions must be kept well hidden. But who can pretend that all is well when one is balancing on the edge of a precipice, and looking down? This time around it was just impossible to blame the crisis on ?greedy? workers. Right in front of everybody?s eyes, the crisis began on Wall Street, the heartland of capitalism, and then spread with lightning speed throughout the world. The fear of an end to their system was revealed in the eyes of the mightiest as they, in front of the cameras, turned to the state and begged them to save the system. The same state that they for decades had said should stay away from business and whose interference they had ridiculed as making things worse in all circumstances. Once the immediate shock had subsided, the mask was put back on. Greenspan retracted his mea culpa, but the economy has remained seriously unstable.

Climate change and other ecological disasters compound their fear. Some in the ruling class are driven by fear of the consequences for all of humanity, including themselves. Others worry that they will not be able to exploit the possibilities that green technology offer. Many fear losing lucrative businesses? that prey on the environment. The differing interests within the ruling class hinder them from taking decisive measures to improve the world?s ecology.

Every day, members of the ruling class fear being out-competed by their rivals. Fear of demotion and the humiliation that it brings with it permeate the existence of the ruling class. Once the fall begins, it is impossible to know how far it will go.

The Revolt in Greece
The first sign of serious working class struggle frightened them even more than their rivals and the economic crisis. As Donald Tusk, Chairman of the EU summits during the Greek debt negotiations, expressed it, ??I am really afraid of this ideological or political contagion, not financial contagion, of this Greek crisis.? Underlying his fear was concern about ?this radical leftist illusion that you can build some alternative.? The same mechanism is at work in all capitalist countries. In some, fear is greater, in some less.

Fear betrays the weakness of the ruling class. Their hold on society is shaky. Their economic concentration makes them vulnerable, as fewer get a stake in the system. Their ability to violently suppress opposition is limited because their social base is small and unstable. They have to rely on ideology to keep control, but due to the unequal nature of society and economic crisis, their ideology is undermined. In the 1950s and 60s, the ideology of the ruling class could argue that the system should be conserved. Reflecting their decrepitude today, new capitalist ideologies have to present themselves as opposing the existing system.

Splits in the Ruling Class
Crises fuel conflicts within the ruling class to the extent of driving a wedge into the very apparatus that has been instrumental in upholding the present system of property ownership ? the state. It fires conflicts between capitalist classes internationally. Proxy wars and real wars between capitalist nations are on the rise. Already these wars have created more refugees than at any time since World War II.

The Cold War between the USA and the Soviet Union died with the collapse of the Soviet Union. It then morphed into a conflict between a capitalist USA and a capitalist Russia. In Africa, the USA and France have supported different sides in armed conflicts. Many are involved in ever more confusing and changing temporary alliances in the Middle East. This is another sign of the weakness of the ruling classes internationally.

Fear also causes the ruling class to split when faced with a decisive movement against them. The widespread mobilisation expressed in the Greek referendum achieved with a single blow what months of negotiations without popular mobilisation had failed to do. It immediately caused a major split within the ruling classes of Europe. On one side, Italy and France led the compromisers. Donald Tusk, EU chairman at the time, swayed wildly. On the other side, Germany leads a motley coalition of EU bureaucrats and politicians from Spain, Portugal, Ireland and some smaller Eastern European countries that have staked their careers on austerity. They and the German leaders, who unlike most European countries have not practised much austerity at home, egged each other on.

Every major popular movement, whether it is national or international, brings forth the same reaction from the ruling class. Driven by fear some parts of the ruling class insist that one should make compromises to save what one can, whereas others insist that if one does not clamp down decisively on the movement all will be lost. Both reactions merely push the movement forward, either by encouraging it or by enraging it. It is only when the movement retreats that the intransigent and violent rulers prevail. Then the whole ruling class is united by their thirst for revenge. They must reassert themselves after having been exposed as emperors without clothes. If a movement towards socialism is begun, it must be done with determination and the process must be relatively short. Otherwise, the ruling class will extract a furious revenge. If such a movement does not take place the choice for society is either neo-liberal disintegration or more likely neo-traditional oppression, persecution and the intensification of international conflicts. However, the ruling class is an important obstacle in the way of a socialist transition only if the working class is unable to unite and have a clear grasp of what to do.


1 thought on “THE BASIS OF A SOCIALIST MANIFESTO Chapter 2 The Ruling Class”

  1. The analysis here is of interest but needs greater attention to the *global* character of capitalism and the global and interconnected global working class. I


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