Will the present owners of the means of production be compensated?

The People
January 11, 1991
Page 6

QUESTION PERIOD

If and when a socialist revolution occurs, will the present owners of the means of production be compensated for the takeover of their property? I realize that this property came from surplus value that was stolen from the working class. But shouldn't at least the small capitalists -- many of whom are honest, hard-working people -- be compensated?

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Our questioner has anticipated the central thrust of our answer regarding "compensation" for the capitalist class generally. All social wealth is ultimately the product of labor, and labor alone. Yet, under the capitalist system, the vast majority of that wealth has fallen into the hands of an idle capitalist class, as a consequence of the process of exploitation. Thus, capitalist development has placed the modern facilities and tools of production, which the working class needs in order to produce, under the private lock-and-key of this minority ruling class.

As a further consequence of capitalist ownership and exploitation, the working-class social majority is suffering from growing privation and a mounting array of deadly social problems that are becoming ever more intolerable. The only solution is for the working class to organize to make the means of production the collective property of all the people, i.e., to establish socialism. In doing so, it is only reclaiming possession of the wealth that it, and past generations of workers, created, but had stolen from them under the conditions of an inhumane and antisocial system.

Accordingly, aside from the fact that "compensation" would be impossible (the exploited, deprived working class could never "buy out" the capitalist class), it would be a repudiation of basic principles upon which the case for socialism rests-the principles that capitalist property represents plunder stolen from the working class, and that society has both a right and a need to reclaim that property in the name of human survival, social well-being and social progress. Why should workers pay their tormentors for the wealth that their tormentors stole from them?

When a majority of society asserts its inalienable right to reorganize the structure of society, it necessarily breaks the bonds of the old system's precepts. Revolutions make their own laws and codes of conduct, and enforce their own conceptions of "right."

From this standpoint, it would be just as absurd to plan to "compensate" the capitalists today as it would have been for the revolutionaries of 1776 to "compensate" the king of England for their taking over of the American colonies!

The question remaining before us, then, is whether or not the "small capitalists" become an exception to this rule, on the grounds that many of them are "honest, hard-working people."

No doubt many small capitalists are honest, hard-working people. Some of them were at one time members of the working class who scraped and borrowed to start up their own small business. But that does not alter the character of their social role, nor does it change the fact that the capital they accumulate, from that point, comes from the plundering of the working class.

But apart from that, consider the real-life circumstances of most petty capitalists under capitalism. The vast majority of them must constantly struggle to survive as a small capitalist-putting in long hours, constantly struggling to make payments to creditors, taking out new loans, etc. Because of the fiercely competitive nature of most small-business sectors of the economy, most of them must become among the most ruthless exploiters of wage labor, paying the legal minimum wage or even below, and even exploiting their own family members.

Even at that, most of them fail sooner or later. According to one estimate made in the mid-1980s, 80 percent of all new businesses fail within the first 10 years. Every year, thousands of petty capitalists, "honest and hard-working" though they may be, lose it all -- due, not to socialism, but to Capitalism. And capitalism does not "compensate" them for their honesty and hard work.

Socialism will transform all the means of production into socialized property, for the reasons stated. But, in contrast to their fate under capitalism, the former petty capitalists will not exactly lead deprived lives. They will join the former members of the working class in the community of self-governing, free producers. Like everyone else, they will be able to enjoy a life of material abundance and security on a much-shortened work-week and good working conditions. And they will enjoy all the other, numerous social benefits of life under a sane, healthy, peaceful social system.

In sum, socialism will not "compensate" any capitalist, large or small, for taking over means of production that rightfully belong to all society. But in liberating society from the constraints and evils imposed by the system of private property, even the capitalists, too, will be liberated from their illusions about "free enterprise" and the pressures of competition, and will enjoy the fruits of industrial democracy. In time, even they will realize that that is far better "compensation" than any monetary compensation that could possibly be paid to them.