Chapter 7 : Co-operatives, Unions, Democracy

Bernstein’s socialism offers to the workers the prospect of sharing in the wealth of society. The poor are to become rich. How will this socialism be brought about? His article in the Neue Zeit (Problems of Socialism) contain only vague allusions to this question. Adequate information, however, can be found in his book.

Bernstein’s socialism is to be realized with the aid of these two instruments: labor unions – or as Bernstein himself characterizes them, economic democracy – and co-operatives. The first will suppress industrial profit; the second will do away with commercial profit.

Co-operatives – especially co-operatives in the field of production constitute a hybrid form in the midst of capitalism. They can be described as small units of socialized production within capitalist exchange.

But in capitalist economy exchanges dominate production. As a result of competition, the complete domination of the process of production by the interests of capital – that is, pitiless exploitation – becomes a condition for the survival of each enterprise. The domination of capital over the process of production expresses itself in the following ways. Labor is intensified. The work day is lengthened or shortened, according to the situation of the market. And, depending on the requirements of the market, labor is either employed or thrown back into the street. In other words, use is made of all methods that enable an enterprise to stand up against its competitors in the market. The workers forming a cooperative in the field of production are thus faced with the contradictory necessity of governing themselves with the utmost absolutism. They are obliged to take toward themselves the role of capitalist entrepreneur – a contradiction that accounts for the usual failure of production co-operatives which either become pure capitalist enterprises or, if the workers’ interests continue to predominate, end by dissolving.

Bernstein has himself taken note of these facts. But it is evident that he has not understood them. For, together with Mrs. Potter-Webb, he explains the failure of production co-operatives in England by their lack of “discipline.” But what is so superficially and flatly called here “discipline” is nothing else than the natural absolutist regime of capitalism, which it is plain, the workers cannot successfully use against themselves.

Producers’ co-operatives can survive within capitalist economy only if they manage to suppress, by means of some detour, the capitalist controlled contradictions between the mode of production and the mode of exchange. And they can accomplish this only by removing themselves artificially from the influence of the laws of free competition. And they can succeed in doing the last only when they assure themselves beforehand of a constant circle of consumers, that is, when they assure themselves of a constant market.

It is the consumers’ cooperative that can offer this service to its brother in the field of production. Here – and not in Oppenheimer’s distinction between co-operatives that produce and co-operatives that sell – is the secret sought by Bernstein: the explanation for the invariable failure of producers’ co-operatives functioning independently and their survival when they are backed by consumers’ organizations.

If it is true that the possibilities of existence of producers’ co-operatives within capitalism are bound up with the possibilities of existence of consumers’ co-operatives, then the scope of the former is limited, in the most favorable of cases, to the small local market and to the manufacture of articles serving immediate needs, especially food products. Consumers’ and therefore producers’ co-operatives, are excluded from the most important branches of capital production – the textile, mining, metallurgical and petroleum industries, machine construction, locomotive and ship-building. For this reason alone (forgetting for the moment their hybrid character), co-operatives in the field of production cannot be seriously considered as the instrument of a general social transformation. The establishment of producers’ co-operatives on a wide scale would suppose, first of all, the suppression of the world market, the breaking up of the present world economy into small local spheres of production and exchange. The highly developed, wide-spread capitalism of our time is expected to fall back to the merchant economy of the Middle Ages.

Within the framework of present society, producers’ co-operatives are limited to the role of simple annexes to consumers’ co-operatives. It appears, therefore, that the latter must be the beginning of the proposed social change. But this way the expected reform of society by means of co-operatives ceases to be an offensive against capitalist production. That is, it ceases to be an attack against the principal bases of capitalist economy. It becomes, instead, a struggle against commercial capital, especially small and middle-sized commercial capital. It becomes an attack made on the twigs of the capitalist tree.

According to Bernstein, trade unions too, are a means of attack against capitalism in the field of production. We have already shown that trade unions cannot give the workers a determining influence over production. Trade unions can determine neither the dimensions of production nor the technical progress of production.

This much may be said about the purely economic side of the “struggle of the rate of wages against the rate of profit,” as Bernstein labels the activity of the trade union. It does not take place in the blue of the sky. It takes place within the well-defined framework of the law of wages. The law of wages is not shattered but applied by trade-union activity.

According to Bernstein, it is the trade unions that lead – in the general movement for the emancipation of the working class – the real attack against the rate of industrial profit. According to Bernstein, trade unions have the task of transforming the rate of industrial profit into “rates of wages.” The fact is that trade unions are least able to execute an economic offensive against profit. Trade unions are nothing more than the organized defense of labor power against the attacks of profit. They express the resistance offered by the working class to the oppression of capitalist economy.

On the one hand, trade unions have the function of influencing the situation in the labor-power market. But this influence is being constantly overcome by the proletarianization of the middle layers of our society, a process which continually brings new merchandise on the labor market. The second function of the trade unions is to ameliorate the condition of the workers. That is, they attempt to increase the share of the social wealth going to the working class. This share, however, is being reduced with the fatality of a natural process by the growth of the productivity of labor. One does not need to be a Marxist to notice this. It suffices to read Rodbertus’ In Explanation of the Social Question.

In other words, the objective conditions of capitalist society transform the two economic functions of the trade unions into a sort of labor of Sisyphus,^[2] which is, nevertheless, indispensable. For as a result of the activity of his trade unions, the worker succeeds in obtaining for himself the rate of wages due to him in accordance with the situation of the labor-power market. As a result of trade union activity, the capitalist law of wages is applied and the effect of the depressing tendency of economic development is paralyzed, or to be more exact, attenuated.

However, the transformation of the trade union into an instrument for the progressive reduction of profit in favor of wages presupposes the following social conditions; first, the cessation of the proletarianization of the middle strata of our society; secondly, a stoppage of the growth of productivity of labor. We have in both cases a return to pre-capitalist conditions,

Co-operatives and trade unions are totally incapable of transforming the capitalist mode of production. This is really understood by Bernstein, though in a confused manner. For he refers to co-operatives and trade unions as a means of reducing the profit of the capitalists and thus enriching the workers. In this way, he renounces the struggle against the capitalist mode of production and attempts to direct the socialist movement to struggle against “capitalist distribution.” Again and again, Bernstein refers to socialism as an effort towards a “just, juster and still more just” mode of distribution. (Vorwärts, March 26, 1899).

It cannot be denied that the direct cause leading the popular masses into the socialist movement is precisely the “unjust” mode of distribution characteristic of capitalism. When the Social-Democracy struggles for the socialization of the entire economy, it aspires therewith also to a “just” distribution of the social wealth. But, guided by Marx’s observation that the mode of distribution of a given epoch is a natural consequence of the mode of production of that epoch, the Social-Democracy does not struggle against distribution in the framework of capitalist production. It struggles instead for the suppression of the capitalist production itself. In a word, the Social-Democracy wants to establish the mode of socialist distribution by suppressing the capitalist mode of production. Bernstein’s method, on the contrary, proposes to combat the capitalist mode of distribution in the hopes of gradually establishing, in this way, the socialist mode of production.

What, in that case, is the basis of Bernstein’s program for the reform of society? Does it find support in definite tendencies of capitalist production? No. In the first place, he denies such tendencies. In the second place, the socialist transformation of production is for him the effect and not the cause of distribution. He cannot give his program a materialist base, because he has already overthrown the aims and the means of the movement for socialism, and therefore its economic conditions. As a result, he is obliged to construct himself an idealist base.

“Why represent socialism as the consequence of economic compulsion?” he complains. “Why degrade man’s understanding, his feeling for justice, his will?” (Vorwärts, March 26, 1899). Bernstein’s superlatively just distribution is to be attained thanks to man’s free will; man’s will acting not because of economic necessity, since this will is only an instrument, but because of man’s comprehension of justice, because of man’s idea of justice.

We thus quite happily return to the principle of justice, to the old war horse on which the reformers of the earth have rocked for ages, for the lack of surer means of historic transportation. We return to the lamentable Rosinate on which the Don Quixotes of history have galloped towards the great reform of the earth, always to come home with their eyes blackened.

The relation of the poor to the rich, taken as a base for socialism, the principle of cooperation as the content of socialism, the “most just distribution” as its aim, and the idea of justice as its only historic legitimization – with how much more force, more with and more fire did Weitling defend that sort of socialism fifty years ago. However, that genius of a tailor did not know scientific socialism. If today, the conception tore into bits by Marx and Engels a half century ago is patched up and presented to the proletariat as the last world of social science, that too, is the art of a tailor but it has nothing of a genius about it.

Trade unions and co-operatives are the economic support for the theory of revisionism. Its principal political condition is the growth of democracy. The present manifestations of political reaction are to Bernstein only “displacement.” He considers them accidental, momentary, and suggests that they are not to be considered in the elaboration of the general directives of the labor movement.

To Bernstein, democracy is an inevitable stage in the development of society. To him, as to the bourgeois theoreticians of liberalism, democracy is the great fundamental law of historic development, the realization of which is served by all the forces of political life. However, Bernstein’s thesis is completely false. Presented in this absolute force, it appears as a petty-bourgeois vulgarization of results of a very short phase of bourgeois development, the last twenty-five or thirty years. We reach entirely different conclusions when we examine the historic development of democracy a little closer and consider, at the same time, the general political history of capitalism.

Democracy has been found in the most dissimilar social formations: in primitive communist groups, in the slave states of antiquity and in medieval communes. And similarly, absolutism and constitutional monarchy are to be found under the most varied economic orders. When capitalism began, with the first production of commodities, it resorted to a democratic constitution in the municipal-communes of the Middle Ages. Later, when it developed to manufacturing, capitalism found its corresponding political form in the absolute monarchy. Finally, as a developed industrial economy, it brought into being in France the democratic republic of 1793, the absolute monarchy of Napoleon I, the nobles’ monarchy of the Restoration period (1850-1830), the bourgeois constitutional monarchy of Louis-Philippe, then again the democratic republic, and against the monarchy of Napoleon III, and finally, for the third time, the Republic.

In Germany, the only truly democratic institution – universal suffrage – is not a conquest won by bourgeois liberalism. Universal suffrage in Germany was an instrument for the fusion of the small States. It is only in this sense that it has any importance for the development of the German bourgeoisie, which is otherwise quite satisfied with semi-feudal constitutional monarchy. In Russia, capitalism prospered for a long time under the regime of oriental absolutism, without having the bourgeoisie manifest the least desire in the world to introduce democracy. In Austria, universal suffrage was above all a safety line thrown to a foundering and decomposing monarchy. In Belgium, the conquest of universal suffrage by the labor movement was undoubtedly due to the weakness of the local militarism, and consequently to the special geographic and political situation of the country. But we have here a “bit of democracy” that has been won not by the bourgeoisie but against it.

The uninterrupted victory of democracy, which to our revisionism as well as to bourgeois liberalism, appears as a great fundamental law of human history and, especially, modern history is shown upon closer examination to be a phantom. No absolute and general relation can be constructed between capitalist development and democracy. The political form of a given country is always the result of the composite of all the existing political factors, domestic as well as foreign. It admits within its limits all variations of the scale from absolute monarchy to the democratic republic.

We must abandon, therefore, all hope of establishing democracy as a general law of historical development even within the framework of modern society. Turning to the present phase of bourgeois society, we observe here, too, political factors which, instead of assuring the realization of Bernstein’s schema, led rather to the abandonment by bourgeois society of the democratic conquests won up to now.

Democratic institutions – and this is of the greatest significance – have completely exhausted their function as aids in the development of bourgeois society. In so far as they were necessary to bring about the fusion of small States and the creation of large modern States (Germany, Italy), they are no longer indispensable at present. Economic development has meanwhile effected an internal organic cicatrization.

The same thing can be said concerning the transformation of the entire political and administrative State machinery from feudal or semi-feudal mechanism to capitalist mechanism. While this transformation has been historically inseparable from the development of democracy, it has been realized today to such an extent that the purely democratic “ingredients” of society, such as universal suffrage and the republican State form, may be suppressed without having the administration, the State finances, or the military organization find it necessary to return to the forms they had before the March Revolution.^[3]

If liberalism as such is now absolutely useless to bourgeois society it has become, on the other hand, a direct impediment to capitalism from other standpoints. Two factors dominate completely the political life of contemporary States: world politics and the labor movement. Each is only a different aspect of the present phase of capitalist development.

As a result of the development of the world economy and the aggravation and generalization of competition on the world market, militarism and the policy of big navies have become, as instruments of world politics, a decisive factor in the interior as well as in the exterior life of the great States. If it is true that world politics and militarism represent a rising tendency in the present phase of capitalism, then bourgeois democracy must logically move in a descending line.

In Germany the era of great armament, began in 1893, and the policy of world politics inaugurated with the seizure of Kiao-Cheou were paid for immediately with the following sacrificial victim: the decomposition of liberalism, the deflation of the Center Party, which passed from opposition to government. The recent elections to the Reichstag of 1907 unrolling under the sign of the German colonial policy were, at the same time, the historical burial of German liberalism.

If foreign politics push the bourgeoisie into the arms of reaction this is no less true about domestic politics – thanks to the rise of the working class. Bernstein shows that he recognizes this when he makes the social-democratic “legend,” which “wants to swallow everything” – in other words, the socialist efforts of the working class – responsible for the desertion of the liberal bourgeoisie. He advises the proletariat to disavow its socialist aim so that the mortally frightened liberals might come out of the mousehole of reaction. Making the suppression of the socialist labor movement an essential condition for the preservation of bourgeois democracy, he proves in a striking manner that this democracy is in complete contradiction with the inner tendency of development of the present society. He proves, at the same time, that the socialist movement is itself a direct product of this tendency.

But he proves, at the same time, still another thing. By making the denouncement of the socialist aim an essential condition of the resurrection of bourgeois democracy, he shows how inexact is the claim that bourgeois democracy is an indispensable condition of the socialist movement and the victory of socialism. Bernstein’s reasoning exhausts itself in a vicious circle. His conclusion swallows his premises.

The solution is quite simple. In view of that fact that bourgeois liberalism has given up its ghost from fear of the growing labor movement and its final aim, we conclude that the socialist labor movement is today the only support for that which is not the goal of the socialist movement – democracy. We must conclude that democracy can have no support. We must conclude that the socialist movement is not bound to bourgeois democracy but that, on the contrary, the fate of democracy is bound up with the socialist movement. We must conclude from this that democracy does not acquire greater chances of survival, as the socialist movement becomes sufficiently strong to struggle against the reactionary consequences of world politics and the bourgeois desertion of democracy. He who would strengthen democracy should want to strengthen and not weaken the socialist movement. He who renounces the struggle for socialism renounces both the labor movement and democracy.

^[2] The mythological king of Corinth who was condemned to roll a huge stone to the top of a hill. It constantly rolled back down against making his task incessant.

^[3] The German revolution of 1848, which struck an effective blow against the feudal institutions in Germany.