A viewer asks why did Paul say that capitalism led to World War I, and another viewer asks if humane capitalism is the answer to today’s problems – Paul Jay joins Taya Graham
TAYA GRAHAM: We’re continuing our conversation with Paul Jay about socialism, and some of the comments from our viewers. So what I’d like to do is share some of the viewer comments on socialism and on your dissection of it with your guests.
Patrick R. says, “Socialism is disgusting. It leads to laziness in business and the workforce, and has literally never worked anywhere. Are you people daft?” So that’s from Patrick R.
Bob R. says, “The answer isn’t socialism. Even the Amish are capitalists. But there is such a thing as humane capitalism. And to get there we need to get back to the New Deal and keep moving beyond that. Socialism always fails on any sort of scale, leading to despotism, collapse, or colonization from the outside.”
And the last one–and this is actually a direct question for you, Paul–[sway ocean] said, “Capitalism gave us World War II? Please explain that, Paul Jay. Shaking my head.” So maybe, Paul, you could address some of these questions and comments that our viewers have. They don’t seem to think that socialism actually will work, and they think you’re suggestion that capitalism led to World War II is an absurd one.
PAUL JAY: OK, so there are three very different questions here, so help me keep track, because I’ve got to do this one by one. I should point out that if people go to the YouTube stories that we’ve been doing on socialism, the vast overwhelming response is a discussion and debate with the assumption that, actually, socialism does make sense. And then there’s recent polling that shows that, I think, under the age of 35 the majority of the population now think socialism is better than capitalism.
TAYA GRAHAM: There is definitely a healthy good faith discussion on socialism happening amongst our viewers. Absolutely.
PAUL JAY: But that being said, it’s a big conversation, just what people have in mind when they say the word ‘socialism,’ because it means a lot of things to different people. And some of the questions raised, you just said, are are good questions. Let’s start with the first one, that under socialism people are lazy, which means productivity goes down. And there’s some truth to the previous experience of that. Some.
Now, like, you take the examples of Soviet Union. Which was a kind of socialism. There is–let me start with saying there’s no such thing as a formula of what socialism any more than there is a formula of what capitalism is. Capitalism in the United States is quite different than that of Canada. What’s going on in Finland is very different than what’s going on in the United Kingdom. I mean, some of the fundamentals are true, that private ownership is primary, and that a kind of oligarchy in ruling circles are in command. You have varying degrees of what is called democracy and voting, you know, has some effect. In other places voting takes place and is somewhat meaningless.
So country by country there are quite serious, or significant, I should say, differences in what capitalism is. And the same thing goes for, so far, the historical experience of socialism. One should also say to get to what capitalism is now took several hundred years. I mean, capitalism of the 20th century–let me jump to the third question. The competition amongst capitalist powers led to World War I and World War II. World War II is the continuation of World War I, where you have the–one of the ways capitalism develops is you have an uneven rise of big powers. So England had risen. I mean, there’s a day when Portugal and Spain were superpowers, and they diminish. There was a time when Britain ruled the seas. It diminishes.
But you have a time, you know, early in the 20th century and coming into the 20th century where you start to have the rise of German capitalism as a real power. The problem is the colonies are all gone. I mean, taken, if you will, not gone. Taken, you know, between Britain growing the United States. France. Where does Germany go to have overseas markets? To have overseas cheap labor? To have overseas easy access to raw materials? Which is something these big industrial powers necessarily want, because one of the things about modern big industrial capitalism is that it expands or it dies, and it loses. You know, these different capitalist powers, countries, are in big competition with each other. And if one gets weaker, the other one tries to jump in and scoop away the cotton market somewhere.
And you know, at the heart of it is very much about just commercial competition. You know, they always–it’s always loaded with a bunch of BS rhetoric of patriotism, and you know, sometimes it’s freedom, and whatever. But at the heart is always commercial interest.
So in World War I, Germany had nowhere to go. And you have internal impulses or forces within German economy to expand. And even while it’s happening, you have a growing arms industry that loves feeding conflict. There’s a guy named Zakharov, he was called the merchant of death, and he was selling machine–you know, the beginnings of the machine gun to the Germans, and he was selling–he’s telling the Germans the French had it; he was telling the French the Germans had it. And he got everybody to kind of get in on this arms frenzy. And you know, the forces that led to World War I, it’s a complicated set of processes. But at its core is big country, big capitalist country, competition for dominance. Germany gets defeated. But it doesn’t take away that Germany is still a mighty industrial power, and starts to rearm, even though they weren’t supposed to, and starts to rearm to a large extent with the assistance of Henry Ford and General Motors and American industry. Why? Because they’re making money out of it. And two, they really hoped that Germany would just march against the Soviet Union and not march West.
So I mean, these are–you know, certainly there’s a lot of complicated factors. But this private ownership, it necessarily leads in these big powers to this inter-power competition. And we’re seeing it again now. You know, the rivalry that’s developing between the United States and China is heading in very similar directions as during the 20th century.
So just dealing with this question about World War II, it’s not like Hitler came out of nowhere. Hitler came out of the deep depression of the 1930s. And you know, people were taking–inflation had reached a point in Germany people were taking their pay home in wheelbarrows. There’s photographs of wheelbarrows with piles of useless cash on it.
TAYA GRAHAM: Full of Deutsche Marks that were useless.
PAUL JAY: Yeah. So I mean, the rise of fascism is a is a product of capitalism. It didn’t just come out of some crazy–Adolf Hitler’s head. And if it hadn’t been Hitler, you know, in the German context, it probably would have been somebody else.
This relates to this idea of humane capitalism. In a similar crisis in the United States in the 1930s, yeah, instead of going towards overt fascism the United States at a time of deep unemployment, and thousands and tens of thousands of people roaming, looking for jobs, and next to no social safety net, and people moving West–and you know, you can read the book or watch the movie ‘The Grapes of Wrath.’ And you know, people were desperate. That is the kind of conditions that could have given rise to a fascism in the United States, but it didn’t. It gave rise to the New Deal.
TAYA GRAHAM: RIght. As a matter of fact, one of the viewers pointed that out, that we need to go back to the New Deal. We need to revisit it, go back to it, and then go beyond it. How do you respond to that?
PAUL JAY: Well, I would say yeah, go beyond it. If you go beyond it, then I would say yeah.
TAYA GRAHAM: How do you respond to that?
PAUL JAY: The New Deal was a hell of a lot better than going towards fascism. And I think at times of these deep crisis there’s not much of an in between. You go the FDR New Deal route, or you go to a very coercive state, and a very militarized state.
The thing with FDR is that in spite of what those policies were intended to do, in the end World War II does come because of the intercapitalist competition. Like, humane capitalism doesn’t work, certainly, for very long. Either because even domestically it was a product of trying to deal with severe crisis. and there’s no reason to think that once the crisis is over, capital doesn’t reassert itself. Which is exactly what happened after World War II.
What happens to the New Deal? It’s a continuous process of undoing it. And we did a whole series called Undoing the New Deal. And to some extent it begins with Truman. And each president afterwards, each administration afterwards, starts to undo the New Deal. Why? Because in this kind of balance of power between ordinary people and working people versus this kind of oligarchy, the ownership class, in the period leading up post-war, in the ’50s and ’60s, it is a place where there’s room for tremendous American expansion. You know, UK has been weakened, the Soviet Union was destroyed. Germany was destroyed. Tremendous–Japan was destroyed. Tremendous place for America to expand and grow. And enormous profit making.
And some of that did–you know, while trickle-down theory in general, I think, is not very legitimate, there was a certain kind of trickle down. Because to achieve domestic peace and to discredit socialism and communism, and because that was, you know, McCarthyism, House Un-American Activities Committee, late ’40s and throughout the ’50s, they wanted to purge the American workers movement. Hollywood. They want to get rid of the left. And so they were in competition with at least the promise of the Soviet Union. I mean, Soviet Union may have had–not may, Soviet Union had some terrible things wrong with the system. And it’s a long conversation why. We did a whole series of interviews with Alexander Buzgalin, I urge people to go watch it, that tries to analyze what happened to the Soviet Union. But when people came back from World War II after fighting fascism, and they were fighting for democracy and freedom and equality, and then they came home, and then they said to the American oligarchy in, like, 1946, they said, well, that’s great. How about we have some? How about here?
So, like, in 1946 there’s more worker strikes in the history of the United States before or since. So there’s a real need here to start crushing this worker’s militancy. The popularity of socialism. At the time the Soviet Union had a very good reputation, because they just played such a role in defeating Hitler. So trying to expunge all this from the society was a major priority. And one of those pieces is you do share some of the booty. You have this American expansion, this massive profits–like, it used to be an ordinary worker in the auto industry in Detroit would own a car, have no problems sending their kid to college. Would even own a cottage.
TAYA GRAHAM: Yeah. American dream.
PAUL JAY: They had–that upper, unionized stratum of the working class was doing extremely well. But it didn’t last. So this FDR New Deal, it can go for a time, but it’s not the nature of the beast of the capitalism. It’s not–at its heart it’s a temporary measure. Because what is at its heart? Not seeking fair profit. Its heart is seeking maximum profit. Why? Not because they’re bad people. It’s nothing to do with them being greedy, or some some moral-
TAYA GRAHAM: It’s the nature of the beast.
PAUL JAY: It’s the nature that if you don’t do it, the other guy is. And he’ll wipe you out. So the competitive pressure forces this striving for maximum profit. Now, within that you get a section of capital that’s a little bit more farsighted. And they say, OK, you should mitigate this a little bit. Like, have Social Security. Have a little bit of humane capitalism. Otherwise you’re going to-
TAYA GRAHAM: Do a little bit of philanthropy here, just a little pressure valve to let some of the steam off to make sure there isn’t a full revolution. Little pressure valve.
PAUL JAY: So yeah, have some of the social safety net. Otherwise the workers will get radicalized. And some sections of the elites feel better about themselves if they have it. This is more kind of in the Democratic Party. And the Republicans, and the certainly the right wing of the Republicans, they want unmitigated exploitation, because they think the workers are too weak to do anything about it anyway. And then enter globalization. And once you can play the Chinese working class off against the American working class, now you can start forgetting about humane capitalism. Because the problem isn’t about being humane. It’s the nature of how the economy works. And it’s the nature of the relationships that when you have this concentrated ownership, yeah, sure, you get the odd guy like Gates wants to give away a lot of money. But he doesn’t want to change who has power. So humane capitalism, listen, it’s better than inhumane capitalism. It’s just to think that you can have a system based on it, and that it’s sustainable, it’s naive. You can’t get there.
Now, I don’t know if we have time for the first question.
TAYA GRAHAM: You know what, I think we’re going to have to leave it there. I hope that for [sway ocean] that Paul Jay gave you a good response and a thorough response to your question. And we’re going to continue this conversation about socialism, what it looks like, what it could look like here in the U.S., and what it looks like around the world.
I’m here with Senior Editor Paul Jay. And if you haven’t already, please hit the subscribe button to our YouTube channel, or subscribe to join our email list so you can get Real News direct to your inbox. Thanks for your time. I’m Taya Graham.