The FSP started in Seattle, where apparently the entire branch left the SWP. The reasons for the split are here, and don't make too much sense to a modern audience. They disagreed only on fine points related to the civil rights movement, the anti-war movement, and the SWP's attitude toward (then) Maoist China. And typical of all splitters, they accused the SWP leadership of unprincipled, undemocratic behavior that forced the issue. Today these issues are mostly moot.
They also believed the SWP underestimated the importance of the women's movement, and this looks to be the primary distinguishing aspect of the FSP today. The Party briefly became an all-woman organization, but has since charitably admitted men. "Party men today are engaged feminists."
That left the feminist impulse unsatisfied, and so a sisterly organization was established: Radical Women (RW), which does exclude men. I'm not sure how the goals or responsibilities of RW differ from the FSP.
The Party had it's share of scandal. The leading lady of the movement was Clara Fraser (1923-1998). At the founding she was joined by her husband, Richard, who then soon filed for divorce. The spat was very public and led to a split in the Party, likely accentuating its feminist flavor.
In 1984 a disgruntled ex-comrade sued for a refund of contributions he'd made to the Party toward rebuilding their headquarters. The Party was then located at Freeway Hall--today it's at New Freeway Hall. The dispute was again very public and drawn out, with Leonard Boudin serving as the FSP's lawyer. Eventually the Party was vindicated, but not until 1992.
By 1976 the Party had branches in Seattle, Los Angeles, New York, San Francisco, and Portland, which is where they are still located. These are the "billionaire cities"--between them they're probably home to three quarters of the country's billionaires. Of course Seattle wasn't like that in 1970--then it was a decaying rust belt town, famous for the billboard: "Will the last person to leave Seattle please turn out the lights." But then a young man named Bill Gates decided to come home to live closer to his parents.
It is ironic that a supposedly vanguard, working-class Party, even today, can only exist in the richest places on earth.
I'm turned on to the Freedom Socialists by an article in North Star written by an FSP member, Susan Williams, entitled Marx's Capital for the 21st century. It's an intriguing title and could be a good article, but it isn't. Instead it's a poorly written piece composed by somebody who knows nothing about economics. But the author can't be stupid--she identifies as a medical doctor and "doctor's union organizer." So we can forgive her economic ignorance. If I'm ever in Seattle (if that's where she lives) and not feeling very well, I'll look her up and engage her in topics she undoubtedly knows more about.
I'm not going to make fun of Dr. Williams, which would be too easy and not much sport. I will also confess I haven't read Capital, nor do I intend to. In my old age I no longer have the patience for bad writing. So I will assume that Dr. Williams' description of Marx is accurate, at least for the topic I wish to consider. She inadvertently points out a place where the world really has changed, and while Marx may have been correct in the 1850s, he is certainly wrong now.
Dr. Williams writes:
In Marx's time, commodities in that sense did make up the major portion of the economy. Today they are a much smaller percentage.
There's another definition of commodity that I think is more useful: A commodity is a product where competition is entirely on price. Gasoline is a commodity--when I shop around I only compare prices, and only secondarily service, cleanliness, quality of the gasoline, etc. Economy class airline seats are a commodity. Tourists look for the cheapest fares, and beyond that they don't care which airline they fly. Business and first-class travel, on the other hand, does not compete on price. They are not commodities, and Singapore Airlines has established a prominent brand name.
Marx may also have used commodities in this sense. He lived during the industrial revolution, when the major industrial output was textiles. They were certainly commodities in the sense that manufacturers competed mainly on price.
And if competition is only on price, then of course profit margins will get squeezed. Marx's conclusion of a declining rate of profit (as a fraction of operating costs) will certainly be true, and is true today for commodities. Gas stations run on very thin margins, as do airlines, and stores like Walmart.
But unlike in Marx's day, most things we buy are not commodities. Let's use a more general term: consumer products are things that consumers buy. I like to include the qualifier consumer because what the consumer can buy will determine his or her standard of living. The more consumer products, the better we shall live.
In today's world, few consumers purchase raw iron ore, raw textiles not yet cut or sewn into clothes, unroasted coffee beans, bushels of wheat straight off the farm, or crude oil. Those are commodities, but today they aren't consumer products. In Marx's time, however, many more of them might have been consumer products. Families, for example, purchased yards of cloth, and then it was up to the women or the servants to fashion that into clothes. We don't do it that way anymore--we're richer than that.
Even if she's not from Seattle, Dr. Williams has likely heard of Starbucks. Starbucks buys two commodities in bulk: coffee and sugar. These get fashioned into elaborate concoctions, prepared using custom equipment by specially trained personnel, and served in bespoke locations designed specifically for that purpose.
Of course all that comes at a price: Starbucks is not cheap. Starbucks is not selling a commodity, but rather a branded product that consumers choose to spend money on. Indeed, it's a good rule of thumb: branded products are not commodities. Instead they're sold because they add some extra value for the consumer that elevates them above the price war. There are lots of branded products: iPhones, Cadillacs, Cheerios, Harvard University, Singapore Airlines, etc. They're a ubiquitous part of our lives, and none of them are commodities.
The declining rate of profit does not apply to non-commodities. Starbucks charges a premium for the benefits of it's brand, which are quite substantial.
Marx did not live in our world. He may never have encountered a consumer product like what we have today. In his world all one could buy were commodities, and it was up to the household to make something more out of them. He lived in a world of commodities; we live in a world of consumer products.
The rules are different. Marx was right. Now he's wrong.
Further Reading:
That left the feminist impulse unsatisfied, and so a sisterly organization was established: Radical Women (RW), which does exclude men. I'm not sure how the goals or responsibilities of RW differ from the FSP.
The Party had it's share of scandal. The leading lady of the movement was Clara Fraser (1923-1998). At the founding she was joined by her husband, Richard, who then soon filed for divorce. The spat was very public and led to a split in the Party, likely accentuating its feminist flavor.
In 1984 a disgruntled ex-comrade sued for a refund of contributions he'd made to the Party toward rebuilding their headquarters. The Party was then located at Freeway Hall--today it's at New Freeway Hall. The dispute was again very public and drawn out, with Leonard Boudin serving as the FSP's lawyer. Eventually the Party was vindicated, but not until 1992.
By 1976 the Party had branches in Seattle, Los Angeles, New York, San Francisco, and Portland, which is where they are still located. These are the "billionaire cities"--between them they're probably home to three quarters of the country's billionaires. Of course Seattle wasn't like that in 1970--then it was a decaying rust belt town, famous for the billboard: "Will the last person to leave Seattle please turn out the lights." But then a young man named Bill Gates decided to come home to live closer to his parents.
It is ironic that a supposedly vanguard, working-class Party, even today, can only exist in the richest places on earth.
I'm turned on to the Freedom Socialists by an article in North Star written by an FSP member, Susan Williams, entitled Marx's Capital for the 21st century. It's an intriguing title and could be a good article, but it isn't. Instead it's a poorly written piece composed by somebody who knows nothing about economics. But the author can't be stupid--she identifies as a medical doctor and "doctor's union organizer." So we can forgive her economic ignorance. If I'm ever in Seattle (if that's where she lives) and not feeling very well, I'll look her up and engage her in topics she undoubtedly knows more about.
I'm not going to make fun of Dr. Williams, which would be too easy and not much sport. I will also confess I haven't read Capital, nor do I intend to. In my old age I no longer have the patience for bad writing. So I will assume that Dr. Williams' description of Marx is accurate, at least for the topic I wish to consider. She inadvertently points out a place where the world really has changed, and while Marx may have been correct in the 1850s, he is certainly wrong now.
Dr. Williams writes:
Capital begins with the individual cell of the capitalist organism: the commodity (an object made to be sold). Marx explains step by step the process by which human labor-power adds economic value to commodities above and beyond the owner’s costs. And he shows how this process inherently steals from the worker. If you know in your gut that you are being robbed at work even though you get a paycheck, Marx demonstrates logically why you are absolutely correct.
Marx laid out how capitalist economy would unavoidably suffer periodic crises worsening over time while the general rate of profit would slow.Marx may have used the word commodity in just the way she describes, namely as a product to be sold. Today, however, the term is used in a much narrower sense. Sometimes it refers to raw materials, i.e., the stuff that comes from mines, oceans, or farms. Thus oil, copper, and pork bellies are all commodities, and are commonly traded on commodity exchanges.
In Marx's time, commodities in that sense did make up the major portion of the economy. Today they are a much smaller percentage.
There's another definition of commodity that I think is more useful: A commodity is a product where competition is entirely on price. Gasoline is a commodity--when I shop around I only compare prices, and only secondarily service, cleanliness, quality of the gasoline, etc. Economy class airline seats are a commodity. Tourists look for the cheapest fares, and beyond that they don't care which airline they fly. Business and first-class travel, on the other hand, does not compete on price. They are not commodities, and Singapore Airlines has established a prominent brand name.
Marx may also have used commodities in this sense. He lived during the industrial revolution, when the major industrial output was textiles. They were certainly commodities in the sense that manufacturers competed mainly on price.
And if competition is only on price, then of course profit margins will get squeezed. Marx's conclusion of a declining rate of profit (as a fraction of operating costs) will certainly be true, and is true today for commodities. Gas stations run on very thin margins, as do airlines, and stores like Walmart.
But unlike in Marx's day, most things we buy are not commodities. Let's use a more general term: consumer products are things that consumers buy. I like to include the qualifier consumer because what the consumer can buy will determine his or her standard of living. The more consumer products, the better we shall live.
In today's world, few consumers purchase raw iron ore, raw textiles not yet cut or sewn into clothes, unroasted coffee beans, bushels of wheat straight off the farm, or crude oil. Those are commodities, but today they aren't consumer products. In Marx's time, however, many more of them might have been consumer products. Families, for example, purchased yards of cloth, and then it was up to the women or the servants to fashion that into clothes. We don't do it that way anymore--we're richer than that.
Even if she's not from Seattle, Dr. Williams has likely heard of Starbucks. Starbucks buys two commodities in bulk: coffee and sugar. These get fashioned into elaborate concoctions, prepared using custom equipment by specially trained personnel, and served in bespoke locations designed specifically for that purpose.
Of course all that comes at a price: Starbucks is not cheap. Starbucks is not selling a commodity, but rather a branded product that consumers choose to spend money on. Indeed, it's a good rule of thumb: branded products are not commodities. Instead they're sold because they add some extra value for the consumer that elevates them above the price war. There are lots of branded products: iPhones, Cadillacs, Cheerios, Harvard University, Singapore Airlines, etc. They're a ubiquitous part of our lives, and none of them are commodities.
The declining rate of profit does not apply to non-commodities. Starbucks charges a premium for the benefits of it's brand, which are quite substantial.
Marx did not live in our world. He may never have encountered a consumer product like what we have today. In his world all one could buy were commodities, and it was up to the household to make something more out of them. He lived in a world of commodities; we live in a world of consumer products.
The rules are different. Marx was right. Now he's wrong.
Further Reading:
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