Michael Kidron and the Permanent Arms Economy

For a new member of the International Socialists in the early 1960s, the public face of the organisation was not Paul Foot (still in Glasgow), nor Chris Harman (then a raw student recruit), nor Duncan Hallas (working as an adult lecturer, in temporary retirement from active politics). Tony Cliff was prominent, but he was not the only strong personality within the group. Cliff’s publisher and IS’s guiding mind was Michael Kidron.

Nigel Harris who joined IS in the early 1960s came into IS though the good influence of Kidron rather than Cliff (Birchall, Cliff, p211). He was not the only one. James D. Young also came into IS through a friendship with Kidron who he met in Oxford in 1955.

Born in South Africa in 1930 (thirteen years after Cliff), Kidron’s own conversion to socialism had begun in 1944. He had fallen ill on a Zionist youth camp in Johannesburg, an entire continent’s width away from his home in Capetown. A hospital visitor read him Stalin’s ‘A Short Course of the History of the CPSU(B)’. “It was a grey volume,” Kidron later recalled. The result of the attempted indoctrination was that after weeks of this attention, “I was foreseeably driven towards Trotskyism.”

Kidron’s elder sister Chanie met and was courted by Ygael Gluckstein. Michael met Cliff briefly but remained in Palestine for a further eight years, arguing against Zionism and translating Rosa Luxemburg. He eventually arrived in London in 1953, joining Chanie and Cliff in the Socialist Review Group. His arrival, he recalls, transformed the group’s prospects. Before he came, there were just six of them. His arrival spurred them on to seven. “Within two months of coming, I was the editor of Socialist Review”. Making best use of his time as a research student, it became a regular monthly publication, and then, three years later, a fortnightly.

Kidron edited the IS’s magazine for its first five years, from 1960 to 1965. “It was a very personally warm period”, Kidron later recalled, “And the group was so small and so obviously ineffectual and, within our very hard class analysis, we could say what we liked. We were searching round for a little bit of soil to drop a seed into. Cliff himself was shifting around. One morning he woke up as Rosa Luxemburg, another he was Lenin, the third Trotsky. And very occasionally he was Marx.”

James D. Young memory of the International Socialists is of a group that was culturally “Jewish”, i.e. discursive, argumentative, and held together by feelings of intense, personal loyalty towards Cliff, Kidron and the leadership. Formal politics played a part too, “What kept the Group together and allowed the young members to recruit new members was the emphasis on libertarian Marxism in the concrete shape of workers’ control, workers’ democracy and the egalitarianism seen in the Paris Commune of 1871 and the early stages of the Russian Revolution.”

Kidron’s intellectual contribution to IS was the idea of the Permanent Arms Economy. Chris Harman has summarised Kidron’s theory as follows: “His central argument was that capitalism was militarised to a degree unknown before in peacetime. This militarisation may have arisen out of the struggle between rival empires to colonise the rest of the world, but had taken on a life of its own. The sheer scale of arms spending had produced a massive growth of manufacturing production, but had also reduced the tendency towards periodic crises. It provided a guaranteed market for key sections of industry. And it reduced upward pressure on Marx’s ‘organic composition of capital’, so offsetting the tendency of the rate of profit to fall. The system had brought stability by becoming more barbaric than ever before. And along with the barbarism went a waste of human resources on an enormous scale.”

The Permanent Arms Economy (PAE), in its original elaboration, was intended to characterise the likely evolution of the world economy – for a considerable period to come. This can be seen in the way Kidron explained the theory to a passing American journalist George Thayer, who interviewed him in 1964:

“Kidron feels that capitalism has stabilized itself on the basis of its expenditure on arms by exporting inflation which, he claims, has minimized the fluctuations of ordinary business cycles. He believes that this stabilizing will become increasingly more viable in the 1970s when Russia reaches the point of military strength equal to that of the West. This may lead, he adds, to a nuclear war which could only be averted by workers’ control of the state and industry. His solution is based, he says, on a re-examination of Trotsky’s analysis that private ownership is a fundamental characteristic of capitalism. Kidron claims that, on the contrary, capitalism is only the unplanned accumulation of wealth and that Trotsky’s stress on nationalization as a means to material abundance must be replaced by stress on workers’ control as a means to human freedom.”

The emphasis on stabilizing factors can also be seen in Kidron’s article ‘ A Permanent Arms Economy’, published in IS in 1967 (http://www.marxists.org/archive/kidron/works/1967/xx/permarms.htm). In a 6,000 word piece, less than a sixth is devoted to the “slow erosion of arms expenditure at the periphery and its increasing concentration at the core”, the rising capital intensity in the arms industry, and the tendencies towards increased unemployment, all of which might bring revolution back into play (the only alternative Kidron could then foresee to the continuation of this stage of capitalism). Five sixths of the piece is given over to spelling out the factors which tend to make arms expenditure permanent. Kidron’s 1968 book Western Capitalism since the War is very similar.

The SWP’s present analysis of the breakdown of PAE is that the dynamics which were stabilising capitalism (i.e. arms spending) were sustained by fewer and fewer of the major powers (essentially just America and Russia), and that this represented a massive levy on these particular economies, both of which were in relative stagnation by the end of the 1960s compared to rivals who were not involved in expenditure on this scale, with the Soviet Union in particular never recovering its postwar growth levels. The world drew back from the arms race, and the PAE ceased to operate on a sufficient scale to stabilise the system as a whole.

This argument is only partially foreshadowed in Kidron’s 1967 and 1968 statements of PAE. He was certainly alive to the contradictions between the Franco-German and the American economies and at times you feel that he could sense the possibility of a non-revolutionary solution to the arms race. But even in Western Capitalism Since the War a book for the hardly-revolutionary publishers Penguin, Michael Kidron preferred to end by emphasising the prospects for revolutionary change rather than any other possibility: “Western capitalism is once again creating conditions for the convergence of working-class protest and revolutionary politics that could change the world. Whether or not that convergence will take place in the seventies depends as much on the revolutionaries as on anything discussed here.”

Kidron eventually broke with IS in the mid-1970s, signalling his departure with a 1977 article ‘Two Insights don’t make a theory’, noting the fragmentation of the state capitalist economies, their strength compared to domestic capitals but their weakness within the system as a whole. He complained that the group’s ideas were losing pace with the development of capitalist reality, “Although the International Socialists and their forerunners in the Socialist Review group were known as the “state caps” for many years, and presented a “state capitalist” analysis as their central, distinguishing tenet, our collective expressed view has not kept pace with the formation and consolidation of state capitalism as a world system; and the analytical variant of “state capitalism” current in the organisation remains locked into the limited partial insight of its original formulation.”

Kidron asked aloud whether he had been right to see PAE as the dynamic feature of the long boom. Perhaps it been rather the growth of cities, the integration of millions of former peasants into an urban capitalist economy, etc:

“Assuming the foundations of the state capitalist system to have been effectively laid during the second world war, it is hard to sustain the view that it was the permanent arms economy that fuelled the long boom. On the contrary, such expenditure must have worked towards stagnation. And if in reality heavy spending on arms coincided with an unprecedented expansion of capital, it can only be because the effects of arms vending were overpowered by the effects of something much more fundamental – the changes that attended the consolidation of the state capitalist system; changes that redirected vast working populations from barely-productive work in agriculture towards highly productive occupations in industry; changes that reduced the amount of social capital required for the new workers and so sharply lightened the capital structure throughout the world; changes that increased the technical division of labour sharply arid reduced duplication of effort as capitals themselves grew to national proportions. On this reading it was despite the arms economy, not because of it, that the first years of state capitalism were years of release of the productive forces and of expansion.” (http://www.marxists.org/archive/kidron/works/1977/07/insights.htm)

If Kidron was right – and I am not an economist, so I raise this only as a question – might his refinement of PAE not point us towards a better explanation of the changes to the world economy in the past 30 years? Under this approach, the “second boom” for 20 years from the mid-1980s would be explained by the same factors which Kidron had identified in 1977, urbanisation and rapid technological development, or, in a word, globalisation. These factors are clearly not altogether exhausted (India’s and China’s continued growth strongly indicates their continuation) but their declining power would be reflected in the weakening of the world economy from 2008 in particular.

This refinement would not, as Kidron argued, refine PAE out of existence, but a sense of PAE’s dual consequence (as both stabiliser and break) might enable us to have a theory of the economy beyond (for example) Chris Harman’s developed answer, which was that growth levels in the economy went into decline from the early 1970s and have never picked up since. The weakness of Harman’s approach, of course, was that it allowed very little analytical space for the real boom which the economy did see especially between about 1998 and 2008 – a pattern very visible if we see the world not only from England or even America but also from South Africa, India, China or Brazil – nor indeed, for the sharp decline that the economy has seen in the last five years.

I have described Kidron’s theory and its political utility; it would be wrong to separate it from his personality and the ideas he had for the development of the group. If the arms economy was a permanent economy, it followed that IS had in front of it several years in which it could grow, without needing to be a mass party, without formulating perspectives for the class as a whole, without the bluster which characterised orthodox Trotskyism in Britain, and against which the International Socialists polemicised very effectively in the 1950s and early 1960s.

George Thayer’s description of IS’ virtues is revealing. He sees the group as very small. Their lack of size was however compensated for by an “intellectual” approach (not to be confused with an “academic” one, Thayer was well aware that IS was competing in “the political arena”, in the Labour Party, and among young workers). “In their own words, they carry on a ‘Marxist dialogue’, presenting new twists to old theories, reinterpreting Socialist needs in light of present developments, and fending off those theses which they deem as no longer suitable.”

In this context that it is worth noting Kidron’s refusal to describe the IS as “Trotskyist”. According to Thayer, “He claims that the group is not Trotskyist but Trotskyist-derived, pointing out that Socialism is his first concern and that his conclusion may only incidentally incorporate the thoughts and these of Trotsky. He adds that he welcomes all Socialist thought – from Marx, Lenin, E. V. Debs or anyone else – if it can be of assurance to him.”

One of Kidron’s fellow International Socialists Dave Widgery later recalled his “inward groan” as Kidron arrived to address some building workers during the industrial agitation of the late 1960s wearing a chamois jacket instead of the issue Trotskyist rig-out. “But they loved the speech … and the bloody jacket.”

Widgery concluded: “What Kidron’s life asks is what kind of a Marxism should we adopt to go beyond the Left’s patriarchal, puritanical, pre-electronic, almost deliberately unpopular presentation of itself? A Marxism that doesn’t lose rigour, traditions and an understanding of what Kidron calls “the system’s major, seismic, fault. The conflict between labour and capital in production.””