Chapter V: The Labour Party’s Adoption of Socialism

3. THE HOME SOCIALISTIC PROGRAMME

Nationalization of the Means of Production, Distribution and
Exchange—The Labour Addendum to the Whitley Report, 1918—The
Industrial Programme of 1918—Land Nationalization—The Control
of Industry—Labour’s Report to the Industrial Conference,
1919—Nationalization of the Coal Industry.

It will be sufficient to review the Labour Party’s official socialistic policy in regard to home affairs starting from 1918. Previously to that date, a number of resolutions had from year to year been passed, formally as hardy annuals, at the Trades Union Congresses and the Labour Party’s Conferences advocating nationalization of land, railways, mines and the municipalization of a number of services of public utility. But from and after 1918 the matter assumes a different complexion.

Nationalization of the Means of Production, Distribution and Exchange

In 1918, at the Nottingham Labour Party Conference a stock resolution was passed in these terms:

“That the Labour Party press for nationalization of all the
means of production, distribution and exchange.”

The arguments of the proposer were that because of the existence of landlordism and the power of the landlords, the people had been driven off the land into towns and overseas, with the result that this country had to depend on other countries for food-stuffs. There was no discussion, and the resolution was passed _nem. con._

The Labour Addendum to the Whitley Report, 1918

The now famous “Committee on Relations between Employers and Employed,” known as the “Whitley Committee,” which advocated the institution in industries of Joint Industrial Councils, Joint District Councils and Works’ Committees, presented the last of their five Reports to the Prime Minister in 1918, dated July 1, 1918 (_Parliamentary Paper_ 1918, Cd. 9153). The Trade Union members[4] of the Committee who signed the report appended this note:

“By attaching our signatures to the General Reports we desire
to render hearty support to the recommendations that Industrial
Councils or Trade Boards, according to whichever are the more
suitable in the circumstances, should be established for
the several industries or businesses and that these bodies,
representative of employers and employed, should concern
themselves with the establishment of minimum conditions and the
furtherance of the common interests of their trades.

“But while recognizing that the more amicable relations
thus established between Capital and Labour will afford an
atmosphere generally favourable to industrial peace and
progress, we desire to express our view that a complete
identity of interests between Capital and Labour cannot be thus
effected, and that such machinery cannot be expected to furnish
a settlement for the more serious conflicts of interests
involved in the working of an economic system primarily
governed and directed by motives of private profit.”

The Industrial Programme of 1918

The new constitution of the Party which was adopted in 1918 was described as a scheme to secure for the producers by hand or by brain the full fruits of their industry and the most equitable distribution of them upon the basis of common ownership of the means of production coupled with the application to each industry or service of the best system of popular administration and control, and to promote the economic emancipation of the people, especially those who depend upon their own exertions by hand or by brain for the means of life. In explanation of this rather vague programme, the Party stated in a contemporary leaflet, that they intended that the supplies of food and other necessaries of life, especially bread, meat, milk, sugar, butter and margarine, water, coal, light, and transport by rail, steamer, tram and bus, now almost entirely controlled by monopolists, combines, trusts and rings, should be acquired by the State to be administered nationally or municipally solely in the interest of the public and the consumers. In the Party’s proposals for reconstruction as contained in _Labour and the New Social Order_, which was finally settled by the Labour Party Conference in June 1918, Labour declared that it stood for:

“The progressive elimination from the control of industry of
the private capitalist, individual or joint-stock, and the
setting free of all who work, whether by hand or by brain, for
the service of the community and the community only,”

and registered its refusal

“absolutely to believe that the British people will
permanently tolerate any reconstruction or perpetuation of
the disorganization, waste and inefficiency involved in the
abandonment of British industry to a jostling crowd of separate
private employers with their minds bent, not on the service of
the community, but—by the very law of their being—only on the
utmost possible profiteering.

“What the Labour Party looks to is a genuinely scientific
reorganization of the nation’s industry, no longer deflected by
individual profiteering, on the basis of the common ownership
of the means of production; the equitable sharing of the
proceeds among all who participate in any capacity, and only
among these, and the adoption, in particular services and
occupations, of those systems and methods of administration and
control that may be found in practice, best to promote, not
profiteering, but the public interest.”

Land Nationalization

At the Southport Conference, 1919, a resolution in favour of land nationalization was formally moved by the Miners’ Federation and carried unanimously by the Conference without argument or explanation; it reads thus:

“Seeing that the land alone of all the factors of production is
both indispensable to man and incapable of expansion by human
agency, it is pre-eminently the rightful property of the nation
as a whole. The present system which treats land as private
property and prevents free access to it, hampers industry,
checks production, crowds the towns by depopulating the
countryside, obstructs the provision of good housing, lowers
the standard of public health both physical and moral; this
Conference strongly urges the Government to bring forward, as
early as possible, some scheme for the nationalization of land
so as to abolish the present unjust system of land ownership
and land leasing. It strongly deprecates the action of the
Government in preventing the completion of the valuation of
the land, and demands that such valuation shall be completed
as early as possible, with a view to the ultimate complete
socialization of all land and minerals.”

The Control of Industry

In view of divergent proposals and the general lack of any precise information as to the Party’s intentions in regard to the control of industry, it is not surprising to find this resolution passed at the Southport Conference, 1919, and, significantly, moved by the British Socialist Party:

“That it be referred to the Executive Committee to consider
and report to a further Conference on the arrangements to
be introduced into industry in order to provide Labour with
facilities to control industry—that is to say, to participate
in the promotion of undertakings, the negotiation of
contracts, determination of the product, and the selection
of markets—and the extent that such control by Labour can
be secured, or is desirable, on the basis of the private
ownership of land and capital. The Executive shall indicate the
distinction between conciliatory Labour and Capital and the
actual control of industry by the workers, and to that end is
instructed to report on:

“(_a_) The Industrial Councils and their bearing on the
question.

“(_b_) The co-partnership of Labour and Capital.

“(_c_) The means to achieve the democratic management of
industries in national ownership.

“(_d_) How far the representation of Trade Unions, through
their Executives or by ballot of the members, could ensure
participation in actual control, and whether, for effective
control, it is not necessary that the employees in the workshop
or the pit shall construct an organization, integral to any
scheme of democratic management.

“(_e_) Whether the sole or partial management by Labour of
industries in national ownership should be confined to the
actual workers therein, or should include workers in other
occupations.”

The delegate who moved the resolution pointed out that there were different opinions in the Labour Party as to control; one section advocating nationalization pure and simple, another a system of control not necessarily involving nationalization, and that for the guidance of the whole Labour movement an inquiry, as suggested by the resolution, was essential so that “instead of having so many pious resolutions they would have facts and data upon which to build their future policy and activity,” The guidance sought has not yet been given.

At the same conference another resolution was adopted as follows:

“That this Conference re-affirms its pledge of nationalization
of industry, but, when nationalized, to come under joint
control with adequate representation of the workers on the
boards.”

The mover of it thought the previous resolution might include co-partnership, and to that he objected. In co-partnership, he said, “the workers interested became as great aristocrats as the ordinary employer. Every industry ought to be nationalized and have adequate representation under joint control.”

Labour’s Report to the Industrial Conference, 1919

In a memorandum by the Right Hon. A. Henderson, Chairman of the Trades Union representatives, which was appended to the Report of the Industrial Conference in 1919 (_Parliamentary Paper_ 1919, Cmd. 501) appointed to inquire into industrial unrest, there occur these statements of Labour policy:

“CONTROL OF INDUSTRY.

(p. ii.) “With increasing vehemence Labour is challenging
the whole structure of capitalist industry as it now exists.
It is no longer willing to acquiesce in a system under which
industry is conducted for the benefit of the few. It demands
a system of industrial control which shall be truly democratic
in character. This is seen on the one hand in the demand for
public ownership of vital industries and services and public
control of services not nationalized which threaten the public
with the danger of monopoly or exploitation. It is also seen
in the increasing demand of the workers in all industries for
a real share in industrial control, a demand which the Whitley
Scheme, in so far as it has been adopted, has done little or
nothing to satisfy. This demand is more articulate in some
industries than others. It is seen clearly in the national
programmes of the railwaymen and of the miners; and it is less
clearly formulated by the workers in many other industries.
The workers are no longer prepared to acquiesce in a system in
which their labour is bought and sold as a commodity in the
labour market. They are beginning to assert that they have a
human right to an equal and democratic partnership in industry;
that they must be treated in future not as ‘hands’ or part of
the factory equipment, but as human beings with a right to use
their abilities by hand and brain in the service not of the few
but of the whole community.

“The extent to which workers are challenging the whole system
of industrial organization is very much greater to-day than
ever before, and unrest proceeds not only from more immediate
and special grievances but also, to an increasing extent, from
a desire to substitute a democratic system of public ownership
and production for use with an increasing element of control by
the organized workers themselves for the existing capitalist
organization of industry.”

(p. vii.) “(_a_) A substantial beginning must be made of
instituting public ownership of the vital industries and
services in this country. Mines and the supply of coal,
railways, docks and other means of transportation, the supply
of electric power, and shipping, at least so far as ocean-going
services are concerned, should be at once nationalized.

“(_b_) Private profit should be entirely eliminated from the
manufacture of armaments, and the amount of nationalization
necessary to secure this should be introduced into the
engineering, shipbuilding and kindred industries.

“(_c_) There should be a great extension of municipal
ownership, and ownership by other local authorities and
co-operative control of those services which are concerned
primarily with the supplying of local needs.

“(_d_) Key industries and services should at once be publicly
owned.

“(_e_) This extension of public ownership over vital industries
should be accompanied by the granting to the organized workers
of the greatest practicable amount of control over the
conditions and the management of their various industries.”

“STATE CONTROL AND PRICES.

(p. viii.) “(_a_) Where an industry producing articles of
common consumption or materials necessary to industries
producing articles of common consumption cannot be at once
publicly owned, State control over such industries should be
retained.

“(_b_) State control has been shown to provide some check upon
profiteering and high prices, and this is a reason why it
should be maintained until industries pass into the stage at
which they can be conveniently nationalized,”

“CONCLUSIONS.

(p. xi.) “The fundamental causes of Labour unrest are to
be found rather in the growing determination of Labour to
challenge the whole existing structure of capitalist industry
than in any of the more special and smaller grievances which
come to the surface at any particular time.

“These root causes are twofold—the breakdown of the existing
capitalist system of industrial organization, in the sense that
the mass of the working class is now firmly convinced that
production for private profit is not an equitable basis on
which to build, and that a vast extension of public ownership
and democratic control of industry is urgently necessary. It
is no longer possible for organized Labour to be controlled
by force or compulsion of any kind. It has grown too strong
to remain within the bounds of the old industrial system and
its unsatisfied demand for the reorganization of industry on
democratic lines is not only the most important, but also a
constantly growing cause of unrest.

“The second primary cause is closely linked with the first. It
is that, desiring the creation of a new industrial system which
shall gradually but speedily replace the old, the workers can
see no indication that either the government or the employers
have realized the necessity for any fundamental change, or
that they are prepared even to make a beginning of industrial
re-organization on more democratic principles. The absence
of any constructive, policy on the side of the Government
or the employers, taken in conjunction with the fact that
Labour, through the Trades Union Congress and the Labour Party
and through the various Trade Union organizations, has put
forward a comprehensive economic and industrial programme, has
presented the workers with a sharp contrast from which they
naturally draw their own deductions.

“It is clear that unless and until the Government is prepared
to realize the need for comprehensive reconstruction on a
democratic basis, and to formulate a constructive policy
leading towards economic democracy, there can be at most no
more than a temporary diminution of industrial unrest to be
followed inevitably by further waves of constantly growing
magnitude.

“The changes involved in this reconstruction must, of
course, be gradual, but if unrest is to be prevented from
assuming dangerous forms an adequate assurance must be given
immediately to the workers that the whole problem is being
taken courageously in hand. It is not enough merely to tinker
with particular grievances or to endeavour to reconstruct the
old system by slight adjustments to meet the new demands of
Labour. It is essential to question the whole basis on which
Our industry has been conducted in the past and to endeavour
to find, in substitution for the motive of private gain, some
other motive which will serve better as the foundation of a
democratic system. This motive can be no other than the motive
of public service, which at present is seldom invoked save when
the workers threaten to stop the process of production by a
strike. The motive of public service should be the dominant
motive throughout the whole industrial system, and the problem
in industry at the present day is that of bringing home to
every person engaged in industry the feeling that he is the
servant, not of any particular class or person, but of the
community as a whole. This cannot be done so long as industry
continues to be conducted for private profit, and the widest
possible extension of public ownership and democratic control
of industry is therefore the first necessary condition of the
removal of industrial unrest.”

Nationalization of the Coal Industry

As illustrating the position taken up by the Labour Party in regard to the coal industry, the following was the resolution settled by a Joint Sub-Committee representative of the Executive Committee of the Miners’ Federation, the Parliamentary Committee of the Trades Union Congress and the Executive Committee of the Labour Party, which was submitted to, and passed by, all their local demonstrations throughout the country in 1919-20:

“This Meeting declares:—

“(1) That the coal of the country forms an obvious necessity
to national life, and that its ownership should therefore be
vested in the community.

“(2) That the mines, machinery, and other means for the
production and distribution of coal, being essential to the
industry, should also be owned by the country.

“(3) That the direction and conduct of the coal-mining
industry, being of vital importance to the workers in the
industry and the coal-consuming public, should be under the
control of National, District and Pit Committees representative
of the national Government and the various classes of workers
including those engaged in the managing, technical, commercial
and manual processes.

“(4) That the objects to be sought by National Ownership and
Joint Control on the lines indicated are:—

“(_a_) To provide the maximum output of the coal consistent
with the provision of adequate protection for the workers
engaged in this most dangerous employment.

“(_b_) The introduction of labour-saving appliances on the
widest possible scale.

“(_c_) A more economic working of coal mines consequent on
the elimination of the interests of private land and royalty
ownership.

“(_d_) The remuneration of the workers in this industry on a
scale commensurate with the dangers endured and sufficient to
provide a healthy natural life for all concerned.

“(_e_) The co-ordination of the distributive machinery of the
trade by the elimination of existing private interests and the
substitution of municipal and co-operative supplies at prices
sufficient to cover costs of production and distribution.

“This meeting therefore calls upon the Government to bring
forward legislation for the national ownership of coal mines
and minerals on the lines indicated, and in accordance with the
recommendations of the Majority Report of the Coal Industry
Commission.”

On March 11, 1920, a special Trades Union Congress was held in London to consider what action should be taken to compel the Government to nationalize the coal mines, and passed this resolution:

“In view of the repeated refusal of the Government to
nationalize the mines, in accordance with the Majority Report
of the Coal Industry Commission, and in agreement with the
terms of the resolution passed at the Glasgow Congress and
the Special Congress held in December last, the Parliamentary
Committee suggest the following forms of action as a means to
compel the Government to adopt the nationalization of mines:—

“(_a_) Trade Union action, in the form of a general strike;

“(_b_) Political action, in the form of intensive political
propaganda in preparation for a General Election;

“In the event of (_a_) being carried, the necessary steps be
taken to give effect to it in accordance with the constitution
of each Union.”

The Congress decided against Clause (_a_) and in favour of Clause (_b_) proposing political action.

At the Brighton Conference, 1921, there was moved by the Miners’ Federation and passed unanimously without a debate the following resolution:

“That this Conference views with regret the failure of
the Government to introduce legislation for the purpose
of nationalizing the mining industry, and reiterates its
conviction that this industry will never be placed upon a
satisfactory basis in the interest of the community until it
is publicly owned and worked between representatives of the
State and the technical and manual workers engaged in it, and
resolves to continue to educate and organize working-class
opinions until the Government are compelled to bring about
this fundamental change in the management and ownership of the
industry.”

The Chairman at that Conference, Mr. Alex. G. Cameron, in the course of his address made these observations:

“The fundamental truth is that the supporters of capitalism
have proved to the world that so long as industry is run on
its present lines the workers will have to submit to periods
of unemployment and periods of over-employment and that the
present capitalist system must go before there can be any
permanent solution.

“The workers, by the strength of their Trade Unions, may from
time to time obtain improved conditions of employment, but
until they obtain possession of the means of producing wealth,
namely, the land, the mines, the railways, shipping, factories
and workshops, they will remain dependent on a small section of
the community providing them with employment. In other words,
they will continue to be at the beck and call of those who own
and control the capital of the country. They will, when the
capitalists decide, be allowed to apply their labour to the
production of wealth, but they will not be permitted to control
its distribution.

“Before the workers will be permitted to control industry
effectively, or even the distribution of the products of their
industry, they will first require to own the machinery and
materials of industry. Such ownership will only be acquired
when we capture political power; and political power will come
only as a result of hard thinking and intelligent action at
the ballot-box. Political power will also enable us to control
credit, money, banking and everything which is fundamental to a
nation’s foreign policy, and is the cause of most, if not all,
wars from which the workers of the world have suffered.”

The Labour Party’s specific proposals for the nationalization of many important industries and “their democratic control” are explained at length in Chapter VIII.