Why We Do Not Support the Call for Public Ownership of the Railroads

On October 5, 2022, the Railroad Workers United (RWU), an organization of railroad workers in the United States, adopted a resolution calling for public ownership of railroads. In the US, these are divided into various private companies.

Later on, the United Electrical, Radio and Machine Workers of America (UE) also issued a similar appeal. In light of these recent facts, we feel it is important to clarify the Party’s standpoint on nationalization.

The communist view on nationalization under a capitalist regime has always been clear and consistent. Marx and Engels wrote much to attack Lassalle’s myth of state socialism, and we, the inheritors of Marxist doctrine, are still fighting against it today. It is clear that there are recurring themes in the various ideological deviations that prevent the proletariat from recognizing its historical goals.

Such a position is well-illustrated in Engels’ text Anti-Dühring (1878), as we quoted also in Il Programma Comunistai n. 13 of 1962: “the transformation, either into joint-stock companies, or into state ownership, does not do away with the capitalistic nature of the productive forces. In the joint-stock companies this is obvious. And the modern state, again, is only the organization that bourgeois society takes on in order to support the general external conditions of the capitalist mode of production against the encroachments as well of the workers as of individual capitalists”.

Let us examine how this transformation occurred in the railways of the United States. As the RWU statement notes, the US Government effectively nationalized the private rail infrastructure in the US for 26 months due to the inability to effectively move the nation’s freight during WWI.

Our Bukharin was in New York at the time, where he was editing the Novyy Mir. His writings allow us to gain a more detailed understanding of the circumstances. On February 16, 1917, he wrote:

“The stronger the position of US capital, the stronger its appetites.

“To satisfy these appetites, strong means of fighting are indispensable: army, air fleet and navy, military fortifications.

“And so the period of so-called preparations has begun. With an infernal din, to the roll of drums and the singing of patriotic songs, they have begun to set in motion, at full throttle, a pump that sucks money to the people for militarism.

“…Economic life becomes a barrack-like entity. Plans to transfer the railways, telephone, and telegraph to the State are drawn up. In addition, a series of institutions is established to draw up plans to transfer or subordinate important sectors of finance and production to the state. A central organization has already been set up to take care of raw materials (this business will be handled by the banker), labor (will it be assigned to Gompers?), and the care and repair of cannon fodder, etc. etc.

“…Of course, in the meantime, they do not forget the ‘fellow workers’. An attack against the right to strike is launched on the whole front. The federal government lashes out against the railroad workers. In a whole series of federal parliaments, bills are introduced, one after another, against the right of workers to defend their interests by strike.”

Indeed, the United States declared war on Germany on April 6, 1917, sending 116,700 proletarians to their deaths in the name of democracy. This was an ideological smoke screen used to hide the interests of US imperialism. RWU does not feel the need to recall this. While it provides a nostalgic account of Wilson’s nationalization of the railways, it is important to remember that this was a war waged for imperialist measures, both at home and abroad.

In no. 80 of our Italian theoretical review, Comunismo, we published Part XVIII of our text “The Labor Movement in the United States of America”; it provides a description which is more than suitable for our purposes here.

“During the summer of 1917, alongside the initiative against socialist and extreme left-wing organizations, a practice of cooperation between unions and the government in important sectors of war production took shape. It was based on a series of agreements that regulated working conditions and the very presence of unions within industries operating under government contracts.”

At that time, the government was facing a significant challenge.

“The unions, feeling particularly strong because of the enormous demand for labor and the urgency of the work, demanded that the wage conditions and union regulations and, above all, the closed shop, were respected in all contracts;

“The government was facing three main issues: the growing militancy of the workers, the unions’ insistence on the closed shop, and employers’ reluctance to accept wage increases”. After all, “profits in war industries were guaranteed by the state”.

In this context, it was the government’s responsibility “to offset any additional costs resulting from pay raises”. The concessions made to the railwaymen were the price the American bourgeoisie was willing to pay to keep its imperialist war plans undisturbed.

In December 1918, the unions held a vote among railroad workers on whether they preferred the railroads to remain state-owned or return to private ownership. The results were overwhelmingly in favor of continued nationalization, with 306,720 votes cast in favor and only 1,466 votes cast in favor of a return to private ownership. These figures are not surprising. Nationalization was done to maintain control over the railroad’s labor force, even in the face of wage concessions that individual capitalists were reluctant to make. And it was incredibly effective.

The American Federation of Labor, or AFL, the regime trade union confederation in the United States, and the American opportunist parties, were all enthusiastic when, in the eight years leading up to World War II, Roosevelt outlined his reforms, which consisted mainly of developing the National Recovery Act (NRA) and devaluing the currency. Our New York comrades, showing that they were very clear about the situation and the historical perspective, wrote then:

“The failure of the London Conference where US imperialism had intervened with the prospect of wresting from its contenders major concessions regarding industrial-financial expansion plans, employing all pressures ranging from diplomatic intrigue to open and direct threat, determined to a certain extent the new orientation expressed in the NRA, a parallel agency of the capitalist state for a more rational exploitation of the working masses.

“This plan was established on the basis of the existing worldwide power relations, the conflicting and antagonistic forces of the different imperialisms. These power relations manifested through unprecedented crises, industrial, financial, and trade failures. It is therefore inevitable that this plan rests on the prospect of a new conflagration for the conquest of new markets” (Prometeo, n. 94 of October 15, 1933).

In addressing the perspective well-outlined by our comrades, Roosevelt merely endorsed and further developed Wilson’s lesson on the need to “concert”. It was not a matter of any alleged political masterminding, but rather of the general tendency of world capitalism having arrived at its imperialist stage, which imposed the authentic social-political content of fascism on to the bourgeois regimes. This content was the disciplining of the “productive forces of the nation” through the framing of workers’ unions and employers’ associations in the bourgeois State. In Germany and Italy, the process began with the physical destruction of the existing trade unions. It then continued with the formation of State-controlled trade unions. Finally, once the bourgeoisie abandoned its brown and black shirts, it continued with the establishment of regime trade unions, which were reconstituted from above by opportunist political parties. These parties have since served as agents for the subordination of trade unions to the national interests of capital. In the United States, on the other hand, there was no need for open dictatorship; however, much of the process of destroying class-based labor organizations occurred, and certainly not without violence.

Roosevelt encouraged every industry to form a federation and submit a “code of fair competition” for the president’s approval. This code, in principle, “would bind each employer not to lay off anyone, to allow a minimum wage and a maximum of 40 hours per week, and to recognize the workers’ right to organize themselves to enter into labor contracts.

“The president had the option of amending each code before approving it. Once approved, each code acquired the force of law. …All or most of the employers had signed up, but they brazenly violated the code “in letter and spirit”. The government had neither the ability nor the will to take serious action against the violators. …Despite the pressure from the masses and the spontaneous spread of strikes, the AFL piecards had been the most vocal proponents of the presidential maneuver” (Prometeo n. 101 of March 25, 1934).

“It is clear that Roosevelt’s new economic policy was designed to provide a temporary solution until the outbreak of the world conflict” (Prometeo n. 105 of June 17, 1934).

It is a matter of historical record that Roosevelt decided to nationalize the railways once again during the second world war. Executive Order #9412 of December 27, 1943, clarifies the true reasons: “the continuous operation of some transportation systems is threatened by strikes called to commence on December 30, 1943”. The railroad workers were about to go on strike for wage increases. The mobilization remained confined within the railway sector because there were no class trade union organizations promoting the extension of the struggle to the rest of the working class and indicating opposition to the ongoing imperialist war. After all, the US bourgeois regime had good reason to comply with the proclaimed principles of cooperation. They granted the railway workers raises to placate them in lieu of continuing their struggle, which was crucial for capitalist productivity. Railway workers benefited not from nationalization, but from the concessions of the State.

After the war, we were just as clear:

“The Marxist analysis of society and the bourgeois system of production is incomplete without acknowledging that State intervention and control in the economy is not a deviation from the fundamental laws of the capitalist economy. It is, in fact, the natural and inevitable outcome of all its historical development. This intervention can go as far as the elimination of the legal form of individual private ownership of the means of production. It will not eliminate the fundamental fact of the capitalist system of production: the exploitation of human labor through the appropriation of surplus value. The capitalist economy in the period following World War I was oriented toward generalized forms of State intervention and control. The Nazi-fascist totalitarian experiment fulfilled the function of permitting and fostering capitalist accumulation and counter-balancing the determining forces of the tendency of the rate of profit to fall, a phase characterized by the succession of violent economic crises and, therefore, by the recurring threat of equally violent social crises. The American New Deal experiment had a similar effect.

“…It is clear that in the monopolistic, centralizing, totalitarian phase of capitalism, the state’s policy of nationalizations is the ultimate weapon used to defend profit and exploit workers in the most brutal way.

“…Nationalization does not suppress the market or the exploitation of labor. It merely regulates the economy according to market forces. Nationalized industries are guaranteed a monopoly within their own borders, but this does not affect the market as a whole. Nationalization also does not prevent the realization and appropriation of surplus value. In fact, it often helps to rescue deficit economic units. Nationalization guarantees capitalist profit in all cases. On the level of inter-imperialist relations, nationalizations are the most bare and obvious expressions of the tension of all national economic forces…. Finally, in the game of class struggles, nationalizations represent the most refined method of immobilizing the active energies of the proletariat and regimenting its fellow poputčiks” (Prometeo, n. 4 of December 1946).

It is true that the Stalinized “Communist” parties prolonged the misconception that Europe was marching toward socialism by virtue of the use of nationalization after World War II. This claim is not only still around, but is still believed. It has even survived the fall of those opportunist parties. The reality unveils the thoroughly bourgeois nature of this political claim and is explained by it. Moreover, as we have seen, it was fully implemented by both the bourgeois-democratic as well as the Nazi and fascist regimes in preparation for World War II.

The Communist Party stands in stark contrast to this social-imperialist watchword in the trade union movement. It supports demands that unite workers more and more broadly, without compromising their independence from the bourgeois class and its State. It rejects the division of workers into two camps: those in companies susceptible to nationalization because of their “strategic value” for national capital and the rest of the working class. Railroaders must be called upon to fight for a single collective contract for the category, beyond the divisions between different companies, containing substantial gains in wages and in working conditions, and this is achieved by organizing united, generalized strikes. Any benefit must be won through struggle, regaining courage, the spirit of independence and confidence in our own strength. We must not seek support from the ruling class. We must be careful not play into the possibility that, in given historical circumstances, it suits the interests of the bourgeoisie to nationalize a given industry and make limited concessions to small portions of the proletariat in order to better oppress and exploit the working class as a whole.

This is opportunism, plain and simple. It’s the sacrifice of the ultimate goals of the proletarian struggle for contingent benefits and only portions of it. Only by fighting collectively can strong wage increases be won, even when the bourgeoisie is unwilling to grant them. The labor movement will only be able to fight on political ground, including opposition to imperialist war, if it unifies workers above divisions between companies, categories, localities, and finally nations. This can only be achieved by a combative trade union struggle movement that unifies workers in the fight against Capital. The labor movement must fight for strong wage increases, reduction of working hours for equal wages, and full wages for unemployed workers.