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The case for socialism (2013 version)

Socialist Party books and pamphlets

The case for socialism (2013 version)

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Nationalisation under democratic workers' control

We support taxing the rich and big corporations, but we also recognise that the 'markets' - that is capitalism - will never meekly accept dramatically increased taxation and regulation.

The most common response to demands for higher taxes on big corporations is that it isn't a 'realistic' demand because they will avoid paying by leaving the country.

What does this say about capitalism? If you are poor, and are found to be claiming a few pounds a week in benefits that you are not entitled to, you are called a scrounger, are demonised by the government, and can even face imprisonment.

Meanwhile when big corporations refuse to pay the levels of taxation agreed by a democratically elected government we are told we are being unrealistic for expecting anything else, and that the answer is to lower taxes to make Britain more competitive!

So what is the alternative to dictatorship of the markets? As a start we call for the nationalisation of the big banking and finance companies.

Compensation should be paid only on the basis of proven need. Not one penny should go to the speculators who are demanding that the working class pay for the crisis for which they bear responsibility.

A socialist nationalised banking sector would be democratically run by representatives of banking workers and trade unions, the wider working class, as well as the government.

Decisions would be made to meet the needs of the majority - for example, offering cheap loans and mortgages for housing, to assist socially useful small businesses, and for the planned development of industry and services, and ending all repossessions of people's homes.

That would only be the start, however. Capitalism has led to enormous economic destruction. In Britain the economy has shrunk by about 10% as a result of the great recession.

Nor is there any prospect of a return to healthy growth. This is the real difference between now and, for example, the end of the second world war when the total national debt was far higher as a proportion of the economy than now - over 200% of gross domestic product (GDP) compared to around 68% in July 2011.

Then, however, Britain entered a period of unprecedented economic growth, thereby shrinking the national debt.

Today, despite the ConDems' constant claims of economic growth, the best prospect that can be hoped for under capitalism is a prolonged period of economic stagnation.

That is why a crucial step towards solving the economic crisis would be to take into democratic public ownership the 125 or so big corporations that control around 80% of Britain's economy.

This would need to be combined with full government control of incoming and outgoing foreign trade. This would enable a democratically elected government - and the working class, not the market - to control imports and exports including capital.

This would provide the possibility of developing a democratic, socialist plan of production that could very quickly transform the lives of millions.

Just some of the things that could be done include:

Unemployment and the working week

As unemployment and underemployment increase, Britain's full-time workers still have one of the longest average working weeks in the European Union.

More than four million workers officially work more than 48 hours a week (and many more do so in reality) in order to make ends meet.

At the same time workers are being told that they have to retire later and later. This is the lunacy of capitalism - millions thrown on the scrapheap while others work their fingers to the bone.

By introducing a 35-hour week with no loss of pay - in other words sharing out the work - it would be possible to dramatically decrease the number of unemployed while simultaneously improving the quality of life of working class people.

If this was combined with, not only an immediate halt in cuts to public services, but a massive increase in them, it would be possible to eliminate unemployment.

This would allow us to develop a vastly improved health service, education system and childcare.


There are five million people, two million households, who are desperate for social housing.

The pipe dream propagated by Thatcher of a 'home owning democracy' lies in ruins. The average house deposit is now 27,500 (and twice that in London) whereas the median wage is only 26,500.

More and more people are being forced into the private rented sector which is almost always expensive and insecure, and often substandard.

As the benefit cuts and bedroom tax bite increasing numbers of people are facing homelessness - turfed onto the street because they cannot afford to pay their rent.

A socialist government would immediately institute a mass programme of building for high-quality, affordable council houses.

In the past, even Tory governments, under mass pressure from the working class, supported a mass house-building programme.

From 1949-54 an average of 230,000 council houses were built each year. There are more than 150,000 skilled unemployed building workers in London alone.

A house-building programme would provide work for building workers, but would also immediately halve or more the amount of money spent on housing benefit, which is currently handed to the private landlords.

Of course, a socialist government would have to take the protection of the environment into account when building housing.

At the moment the big construction companies build purely for profit with little concern for the environment, the standard, or affordability of the housing.

A mass house-building programme would mean careful planning to ensure the protection of green spaces.

In many cases, it would be possible to build on fully decontaminated brownfield sites. Moreover, pleasant and safe homes for all form a crucial part of a decent environment.


Childcare in Britain is the least regulated, hardest to obtain and most expensive of any country in the European Union.

The average weekly cost of a nursery place is 160. Lack of decent childcare facilities means that increasing numbers of parents, in particular women, do not have the choice of going out to work. Others are forced to rely on unqualified child carers.

New Labour's solution was to introduce the Working Families Tax Credit (WFTC) and some parents are able to struggle through with this.

In total the government still spends millions of pounds helping pay for childcare via the childcare element of Working Tax Credits.

The Tories have already made cuts to WFTC, and even at its height it was nowhere near enough. Instead of handing money over to private nurseries, it would make far more sense to spend the money building and directly funding free, publicly owned nurseries, after-school and holiday clubs, with fully qualified, decently paid staff.


The NHS was the greatest achievement of the 1945 Labour government. Now the ConDem government is systematically destroying what is left of the NHS, which had already been undermined by New Labour in power.

In England massive privatisation is being combined with brutal cuts. In Wales privatisation is not yet on the same scale, but the cuts now being carried out are even greater than in England.

Privatisation of the NHS is being carried out in part in order to provide new and profitable fields of investment for big business.

Since 2001 the Tories have received more than 10 million in donations from companies profiting from private healthcare.

Labour is also implicated. The former Labour health secretary, Patricia Hewitt, is now on the board of the private healthcare company BUPA and Cherie Blair, wife of ex-prime minister Tony Blair, has set up her own private healthcare company and is planning to set up private doctors' surgeries in Sainsbury's.

A socialist policy for the NHS would mean an immediate end to privatisation and a reversal of all the privatisation already introduced.

However, this does not mean we want to go back to the NHS of 20 years ago. The NHS needs to be democratically run and accountable with the full involvement of NHS workers and users.

It also needs to be better integrated (between hospitals, primary care, community care, social services, dentistry, etc) in order to give people the best possible service.

All charges for healthcare, including dentistry, eye tests and prescriptions, should be completely abolished.

How could this be paid for? A socialist government would redirect money currently spent on war and occupation into the health service.

The cost of replacing Trident nuclear missiles, for example, is estimated at 20 to 30 billion, which could be far better spent on the NHS.

We would also take the pharmaceutical and drug companies into democratic public ownership. In 2002, the wealth of the global pharmaceutical industry was estimated at $406 billion.

It is a closely guarded secret exactly how hefty a chunk of the billions the pharmaceutical industry makes comes from the NHS.

Even the pro-Tory Telegraph, however, has revealed that drugs companies are charging the NHS over the odds prices (even by their own standards) for up to 20,000 different drugs, costing the NHS hundreds of millions of pounds a year.

A nationalised pharmaceutical industry would take decisions driven by meeting people's health needs, not by profits.

It would be able, for example, to direct research at curing diseases and developing treatments for less common illnesses which the current drugs industry ignores - because they are not profitable.

At the same time a socialist government would carry out measures to increase living standards - such as a decent living pension, increased annually and linked to earnings, and the right to a job with a living wage for all.

It should not be underestimated how much such measures would improve people's health. Ill health remains a class issue - even according to government statistics, low-paid workers are almost three times as likely to suffer from chronic ill health as high-level managers.

Manufacturing jobs

In a world of crisis, there is a particular crisis of British capitalism, which is paying the price for its refusal to invest in industry over decades.

Despite the CBI calling for the government to find ways to increase investment in manufacturing, there is no prospect of rebuilding Britain's feeble manufacturing base.

On the contrary, manufacturing shrank by 2.1% in the first three quarters of 2012 and exports continue to decline. At the end of last year industrial output reached its lowest level since 1992.

Both Tory and Labour governments have done nothing but stand aside and wring their hands as factories and steel plants have closed or had their workforces cut to the bone.

In the past, even Tory governments intervened in the economy occasionally. Tory prime minister, Ted Heath, for example, nationalised Rolls Royce in the early 1970s.

Clearly, the Tories were acting in the interests of big business, propping up industries before selling them back to the fat cats at rock bottom prices, similar to the way the banks have been propped up by government money today.

However, manufacturing industry, by contrast, is allowed to go to the wall. Hundreds of millions of pounds of public money are being spent picking up the pieces in Dagenham, Birmingham, Yorkshire, Scotland and Wales and all the other places where factories have closed or jobs have been slashed.

The cost comes from the loss of tax and National Insurance income, the increase in benefit claimants, and the unquantifiable social costs such as the extra strain on the health and welfare system.

Rather than spend that money dealing with the aftermath of cuts and closure, it would be far better to invest it in keeping the industry concerned alive and, if necessary, developing new, more socially useful production.

For example, there is no need for all car plants to continue with their current production. Workers should be asked what the best use of their skills would be.

Options might include environmentally friendly cars, buses or trams, or the development of green technologies.

In the mid-1970s, workers at Lucas Aerospace, the weapons manufacturer, produced an alternative plan of production.

They worked out that their production lines could easily be altered to produce kidney machines, electronic wheelchairs and a number of other products far more useful to humanity than weaponry.

But such huge public investment should not be yet another subsidy to private companies' profits. Government intervention and public investment should be matched by public ownership and control.

It would then be possible for workers in individual plants, together with representatives of workers throughout industry, to draw up a new plan of production to better meet the transport needs of the whole of society.

A living wage

One of the most popular things New Labour did was to introduce a minimum wage. From the beginning, however, it was set at a level that was acceptable to big business - a minimal wage.

Today the minimum wage is at its lowest level in real terms since 2004, and leaves millions unable to make ends meet.

Working Tax Credits, which cost 30 billion a year, a large part of the country's benefit bill, are essential for millions of workers to get by.

In reality, though, tax credits are a subsidy to slave labour employers, allowing them to get away with wages that are too low to live on.

A socialist government could immediately implement a real living minimum wage for all, of at least 10 an hour, and probably more.

A real minimum wage would be just that - the minimum that is paid to any worker with no exemptions. The youth rate should be immediately abolished and young workers guaranteed the adult rate.

Hundreds of thousands of workers currently do not even get the legal minimum. For example the Low Pay Commission estimates that between 9% and 13% of care workers are paid below the minimum wage.

Yet, since the minimum wage was introduced in 1999, only eight prosecutions of employers have taken place!

A socialist government would strictly enforce the minimum wage. If small and medium sized businesses said that they could not afford to pay it they would have to open their books to scrutiny by democratically elected committees.

Those that genuinely could not afford to pay the minimum wage, and which were playing a socially useful role, could then receive government subsidies to allow them to pay their workers fairly.

At the same time, implementing a living minimum wage would not be the only measure a socialist government could quickly implement.

Today there is no relation between the extent to which the majority in society value the work someone does and the amount they get paid for it.

Hence stock brokers receive gigantic salaries while highly skilled nurses, fire-fighters, paramedics and other life-saving workers are facing a pay freeze.

The same is true for teachers, who play the enormously valuable role of educating the next generation, and are seeing their terms and conditions being viciously attacked by education minister Michael Gove.

We want to create a society where everyone receives a decent wage. Highly skilled workers would receive higher pay than the minimum wage, but there would be no need for the huge differentials that exist under capitalism.

At the time of the Russian revolution in 1917 wage differentials were initially set at 4:1. However, in a modern economy like Britain it would be possible to have a smaller gap between top and bottom.

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