[Socialism Today, No 17, April 1997, p. 11-16]
Despite the interchangeability of Tory and New Labour policies, Labour’s likely election victory will open up a new era in British politics, accelerating the re-emergence of mass workers‘ struggles and the revival of socialist ideas. Lynn Walsh writes.
By delaying the general election to the last possible date, Major has prepared a devastating Tory rout. Hardly anyone believes that Labour will not win on 1 May. Tory MPs will fight furiously to keep their seats, but for the Tory leaders the campaign will mark the beginning of a dirty leadership contest to replace Major after the defeat.
Various opinion polls give Labour a lead of between 14% and an astounding 25%. A 14% lead, if maintained would give a majority of 150. A 25 % lead would produce a Labour majority of 300. That would reduce the Tories from their current 336 seats in Parliament to only 150 – a wipe-out of Canadian proportions. The parties, however, face an unusually long campaign and it is unlikely that such huge Labour lead will be maintained until polling day.
As the former Tory treasurer, Lord MacAlpine, recently revealed, the Tories have raised £60m since 1992 and will spend around £40m on this election. They will concentrate on negative campaigning. “Take that leap into the dark if you wish”, Major warned Daily Telegraph readers (18 March). “Gamble your hard won gains if you like. Throw caution to the wind if you dare. But your pay packet, your taxes, your children’s education, your doctor’s surgery, and your country itself? Yes, they could change – for all time”.
This is the fear tactic. It will have no effect whatsoever on the millions of working people who have suffered a painful erosion of their living standards under Thatcher and Major – could anyone believe his promise ‘to turn all the have-nots into haves’? Yet the Tories will not even convince the ‘middle-class’ voters, the skilled and white-collar workers, the professionals and middle class, who swung to Thatcherism in the 1980s. After eighteen years, they too have had enough. The 1990s has brought growing insecurity for ‘Middle England’ too ,especially through short-term job contracts. Despite the fall in interest rates, they are still burdened with massive 1980s mortgages. They are sick of the shambles in education and have had enough of privatisation as the commuter revolt on South West Trains recently demonstrated. “Capitalism has scored some extraordinary victories in the Past two decades”, writes Professor John Kay in the Financial Times (27 February) “Yet market economics remains unpopular… privatisation for example, remains a term of abuse. Many privatised companies are even more unpopular than their nationalised predecessors. And rising salaries in the boardrooms have aroused great hostility”. A big factor in the coming Tory defeat, will be the collapse of their support amongst former Tory voters in the Midlands, the South and the South East. Marginal constituencies will tumble like dominoes.
In any case, the Tories’ scare tactics appear ridiculous. Who really believes that Tony Blair is going to unfurl the Red Flag once he gets into Number 10? “We do not promise the earth”, Blair reassured his £500-a-head guests at the Hilton Hotel recently. We do not hail revolution. Reform and change will come on a step by step basis”. In case they had any lingering doubts, he said “It simply defies logic to think that we would go through such a radical change in creating New Labour merely to slip back if we win”. (Guardian, 13 March).
Lady Thatcher herself reportedly told guests at a recent private dinner that Blair is ‘A man who won’t let Britain down’. Rupert Murdoch is convinced too. The Sun’s endorsement of Tony Blair on 18 March, commented The Telegraph, “was couched in overwhelmingly right-wing terms: almost as though a pro-Tory piece had been amended at the last minute by insertion of Mr Blair’s name instead of John Major.” The Sun’s backing, is the reward for Blair’s wooing of the Australian media mogul in 1995. After that, Labour’s spokespersons made no mention of any regulation of monopoly control of the press, television and satellite channels.
If Labour wins a big victory it will be on a powerful wave of anti-Tory feeling, not support for New Labour’s policies. The Tories are gaining no advantage from the relatively buoyant phase of the current economic cycle. The March fall in unemployment (68,000), partly due to massaging figures again, and the slight upturn of earnings, has not restored popular confidence in the Tories’ economic management, which was shattered b the ERM fiasco in 1992.
But what, concretely, does New Labour offer? If the Tories tactic is fear, Labour’s theme is hope. “Labour stands as a revitalised political force ready to offer new hope and leadership”, says Tony Blair (Daily Telegraph, 18 March). The Tories mean “division and decay”, whereas Labour offers a fresh start for the future”.
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The Labour leaders’ tactic is to stick to the broad brush. The detail will come after 1 May. Yet Blair and New Labour’s prospective chancellor Gordon Brown, have already made it clear what to expect. There will be no increase in tax rates for either individuals or companies during the lifetime of the next government. New Labour will keep to the Tories’ current expenditure plans. That means continuing to impose spending limits aimed at reducing the PSBR (public sector borrowing requirement) from 3.5% of GDP in 1996/97 to under 1% in 1999/2000. That is a savage reduction. Whatever else a Labour government does, continuing that policy will inevitably mean continued pay limits and further job losses in the public sector. It will also mean a mere 0.9% increase in NHS spending next year and a savage cut of minus 0.16% the following year. Yet the NHS needs a 3% above-inflation increase every year merely to stand still. The only new money for the health service earmarked by the Tories is increased private finance.
So what difference will a New Labour government make? It will make no fundamental difference at all to the decline in living standards for the majority of working people and the continuing polarisation of income and wealth. In the short term, however, there will be some new expenditure, which will give the honeymoon government some room for manoeuvre. Although Brown will not increase tax rates, he may be able to raise some additional tax revenue. There will be a once-off windfall tax on the excessive profits of the privatised industries (they have no intention of taking any back into public ownership). Even on this, the figures have already been reduced, from the £10bn originally mentioned to something under £5bn. This money will be mainly used for job-creation schemes for young unemployed people. In reality, it will fund subsidies for employers to provide ‘jobs and training’, a revival of the Tories’ discredited YTS schemes with a strong dose of workfare thrown in. This approach will not create long-term, productive employment.
Brown may also prune some of the 200 ‘reliefs’ which currently allow the wealthy to reduce their tax. He may phase out the current allowance for share dividends paid to pension funds (taxed at 13% as opposed to the normal rate of 33%), which could produce between £4bn and £5bn a year. Brown may also allow local authorities to spend part of their £2.5bn reserves from council house sales on new capital projects. Taken together these could provide a significant short-term boost to the economy. A strata of workers and young people would benefit, at least for a time. Any such expansionary approach, however, will be short-lived.
The promises to ‘revitalise education’ are vague, apart from the reduction of class sizes in primary schools and expansion of nursery education. Some of the extra money for education, moreover, will come from welfare. Following the example of Clinton’s New Democrats in the US, New Labour is adopting an increasingly moralistic stance towards the ‘undeserving poor’, the long-term unemployed, single parents, scapegoating them for social problems. Labour will push even further the Tory policy of cutting housing benefit, income support and other benefits and intensifying the pressure on the poorest strata of workers.
Even Brown’s paltry proposals rest on optimistic assumptions about the growth of the economy. City economists predict a growth of around 3.3% of GDP this year, falling slightly in 1998. But the current extremely weak and uneven ‘recovery’ cycle of the advanced capitalist economies is nearing exhaustion. While the timetable is uncertain it is unlikely to last more than another year or 18 months.
A downturn in the US and/or several major EU economies would push British capitalism into recession too. A downturn inevitably means a reduction of government revenue from taxation. Accepting the logic of big business and the market, New Labour would be pushed to implement even more savage spending cuts. Any short-term gains in employment through job creation schemes would be wiped out, followed by a horrendous escalation of unemployment, which is now an organic disease of the system. Even during the upswing of the last four years, only 38% of new jobs have been for permanent, full-time workers. Moreover, according to the Labour Force Survey, the real unemployment level is 2,200,000. There are also 3,300,000 households without any working adult, one in five. The current differential between the top 10% of male workers and the bottom 10% is 3.73:1, compared to 2.53:1 in 1979. trends.
There is no way that New Labour’s policies are going to reverse these trends. With a new recession or slump, there will be a catastrophic situation for lower paid workers and the
unemployed, retired people, etc.
The New Labour leaders have repeatedly spoken of their desire for a new ‘partnership‘ between government and industry. “Our first move in government”, stated the policy statement, Made in Britain, will be “to bring together industry and finance into manufacturing partnership … (the) goal will be to define the policies which industry needs”. The theme of policy documents is that a New Labour government would promote manufacturing industry, invest in the infrastructure, and raise the quality of human capital, the workforce, through education and training of workers. According to Gordon Brown. “businesses increasingly understand that in a modern, global economy, the policies necessary to tackle growing inequality and social dislocation are the very same which are necessary to produce a dynamic and competitive economy, (Fair is Efficient). The theme is clear, but once again the statements avoid getting down to the nitty gritty.
How will a New Labour government promote increased investment in manufacturing? Despite the sharp increase in profitability (mainly due to reduction of the workforce and intensified exploitation) and the increase of exports (due to the devaluation of the pound), manufacturing investment is still below the previous 1989 peak in real terms. Big business is unlikely to step up investment as this economic cycle nears its end. Why should they increase capacity ready for a new recession? The secret seems to lie, according to Dr John Gray, a former Thatcher fan who now supports the ‘stake-holding‘ philosophy of New Labour, in the role that a Labour government will play “in nurturing the complex, cultural, legal and social institutions that make a modern market economy. (Guardian. 4 March).
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While New Labour’s statements frequently refer to the crucial relationship between ‘the government the city and the CBI’, they make little or no reference to the trade unions “We have revolutionised our relations with the trade unions”, Blair assures the bosses, “to make clear that we offer fairness, not favours, in government’. This means that “the key elements in the trade union reforms of the 1980s will stay”. (Daily Telegraph 18 March). New Labour will not attempt to reverse the shift in the balance of power between capital and labour brought about by the Tory’s anti-trade union laws.
Labour has indicated that it will restore union rights at GCHQ, the government intelligence gathering centre – a symbolic reform. They may also restore the check-off system, so unions can automatically collect members dues. It is not even certain whether a Labour government will accept the TUC’s call for legislation allowing for US-style ballots for workplace recognition. Labour has rejected criticisms by the International Labour Organisation of existing a serious obstacle to the defence of British union laws, which flagrantly breach the ILO convention ratified by Britain.
Despite pressure which will build up from within the ranks, however the union leaders will not confront a Labour government on these issues or even seriously campaign to restore trade union rights. Within the Labour Party the union leaders used their weight to support Kinnock, Smith and Blair in pushing the party to the right.
“The British trade union movement is going all out to co-operate with an incoming Labour government”, writes William Keegan (Observer, 2 March). A sensible concordat between Labour and labour would do much to take the burden off monetary policy”. In other words, if the union leaders hold back wage demands, it will not be necessary for the government to follow a deflationary monetary policy. Completely supporting the market ideology of New Labour the leaders of ‘New Union’ unionism will act as policemen for the Labour government. They will continue to be a serious obstacle to the defence of workers interests.
Presenting the TUC’s latest policy document, Partners for Progress: Next Steps for the New Unionism, John Monks argues that “unions must shed the old ‘them-and-us’ approach in favour of partnership with employers and a new government, if they are to be part of the solution to Britain’s economic problems”. (TUC press release, 6 March). Partnership on whose terms? The TUC leaders are not even prepared to push for an effective minimum wage. Brown will not accept the TUC’s official proposal for £4.26 an hour, and if Labour actually sets a minimum wage it is likely to be less than £3.50.
Even before the election a number of unions have rushed to push through wage deals, with the local authorities for instance, settling claims to avoid any conflict with a Blair government. A large section of workers, however, still have great expectations for improvements under a Blair government. At least Labour will be more amenable to pressure from the unions, they think. The reality will be that Labour will be ruthless in enforcing pay restraint whether formally of informally and will use anti-union laws against workers who press for more. This will provoke massive opposition within the unions, especially with an economic downturn and rising unemployment. There will be renewed struggles to democratise the unions, and to put in leaders who will fight for workers’ interests. Conditions will open up for the growth of the left in the unions.
Because union officials will in the main act to dampen movements on pay and conditions, there will undoubtedly be a growth in unofficial action. Such movements will strengthen the demand for change within the official structures. At the same time, a number of unions are now so undemocratic, their leaders so closely linked to the bosses, that some workers may attempt to split away from their existing unions, either setting up new bodies (such as the offshore oil-workers Oil Industry Liaison Committee) or looking towards unions which appear more responsive to their members.
Even the Blair government, however, despite its meagre offerings for workers, will enjoy a certain honeymoon. It will take time for the reality to sink in. The timescale for the development of opposition cannot be accurately predicted. Nevertheless, a massive movement of opposition will develop to New Labour’s policies, with inevitable clashes between the working class and the government.
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Another major issue during the campaign will be constitutional reform. One of Blair’s five ‘modernising pledges’ is ‘to devolve constitutional power’. The most pressing issue will be a measure of autonomy for Scotland. Although showing signs of prevarication, Blair will probably have to go through with a referendum in the autumn. This would almost certainly lead to the establishment of a Scottish parliament very soon. New Labour’s devolution plans, however, have virtually been stripped of any real content. Their proposed Scottish parliament will be a mere talking shop, with very few powers beyond those of a glorified metropolitan council. This will probably not significantly undermine support for Labour in the general election, as there is an overwhelming anti-Tory mood in Scotland too. After the election, however, the limitations of Labour’s devolution proposals, together with the failure of a New Labour government to resolve burning social and economic issues, will undoubtedly lead to the growth of massive opposition in Scotland.
Disappointment with a Labour government, as under the Wilson government in 1974, will fuel nationalist sentiment in Scotland. The SNP is likely to make further gains. The extent to which they are able to capture support, however, depends decisively on developments within the working class. There will almost certainly be pressure for the separation of the Scottish TUC and the formation of a separate Scottish Labour Party. The role of the Scottish Socialist Alliance, in which Scottish Militant Labour plays an important role, in putting forward an alternative to both New Labour and the SNP, will be crucial.
The Tories will launch a vitriolic attack on Labour’s constitutional proposals, accusing them of ‘betrayal’ of historic national interests. Defence of the constitution, waving the Union Jack, is the symbol for defence of the imagined interests of chauvinistic, Little England property interests. It also serves as a respectable cover for racism. In Wolverhampton, for instance, Enoch Powell’s old constituency, Tory MP Nicholas Budgen is already raising the question ‘how strict will control of immigration be under Labour’.
Blair and company have tried to secure their flank on the constitutional issue through a deal with the Liberal Democrats. The Labour leaders contemptuously dismissed the proposal from former Labour minister and SDP defector, Roy Jenkins, for a merger between Labour and the Liberal Democrats. Nevertheless, ‘sources close to Tony Blair’ do not rule out some kind of post-election pact, or less formal arrangement with Ashdown and company. There is obviously quite a high degree of agreement between Labour and the Liberal Democrats over reform of the House of Lords and proposals for electoral reform, though the details are being kept very quiet.
Labour will phase out hereditary peers from the Lords and introduce some process for the ‘balanced’ selection of life peers. Labour supports proportional representation for a Scottish parliament and for Euro elections. On Westminster elections, they are proposing a commission to study PR, and prepare for a referendum on the issue within a year or so. Now that New Labour expects to win a clear majority in the general election the question of PR is not so urgent. In their private counsels however, the Labour leaders recognise their majority will be far from secure, and are certainly seriously considering the option of PR which would strengthen the possibility of a future coalition of Labour, the Liberal Democrats, and Tory wets, given the likely fragmentation of the Conservative Party in the next period.
The fifth ‘modernising pledge’ of Tony Blair is to ‘Get the best out of Europe’. This vague formulation leaves plenty of room for manoeuvre. Previously, John Smith and Blair enthusiastically supported the Exchange Rate Mechanism and membership of EMU. More recently, however, Blair has begun to assert that he will ‘defend Britain’s national interests’ in relation to Europe. Prevarication, however, may be the order of the day, as even the leaders of German capitalism are now raising doubts about the EMU timetable. Europe is not such a problematic issue for Blair at the moment as it is for Major. Within the Tory Party, the Euro-sceptic bandwagon reflects right-wing, nationalistic opposition to Major’s leadership itself as much as opposition to the European Union.
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More than ever before, the Labour leaders will fight this election campaign through the media. Labour will spend £10-15m, perhaps more, which includes substantial donations from business interests. The campaigning methods of the past, rallies, meetings, even door-to-door canvassing, are out. The Labour Party membership is now overwhelmingly middle-class, consisting of higher paid white-collar and professional workers. Many are now joining Labour like people buying Poppies on Armistice Day. The possibility of career openings under a Labour government is undoubtedly a factor for some. These people have no experience of campaigning activity, and have no inclination to go out on the doorsteps. The turn out of working class support will depend primarily on the prevailing anti-Tory mood.
The ideologues of New Labour, like Geoff Mulgan of the think tank Demos, argue that the traditional forms of politics are in irreversible decay, and advocate a new ‘lean democracy to replace the old fashioned system of formal, and hierarchical, parties and organisation’. They advocate a new ‘techno-populism’, with the party leaders communicating through the electronic media directly with the masses. The approach is completely top down. This is reflected in the highly centralised concentration of power in the hands of the leadership, brought about under the Smith-Blair ‘reforms’ of the Labour Party’s internal structure. In reality, this corresponds to the top-down nature of society, in which the levers of economic and political power are more dominated than ever by the capitalist ruling class. While Blair denounces ‘tribal politics’, that is, class politics, the logic of the system continually exacerbates the deep class polarisation of society. Moreover, the crisis into which the system will be plunged in the next few years will provoke massive struggles and movements – which will provide the basis for a revival of the mass parties and mass movements that Blair and company have written off.
The alleged decay of mass politics really means the decay of the Labour Party as a reformist party. Its working class membership and stable electoral base has steadily declined since 1974- 76, when the Labour leaders announced that the ‘party was over’, abandoned reforms and turned to neo-liberal policies and attacks on workers’ living standards and rights. The Labour Party is now a completely bourgeois party.
The degeneration of the Labour Party has effectively disenfranchised the working class. There is still a pressing need, however, for a broad, mass party representing the interests of workers, which will act as a vehicle for mass mobilisation and action.
The social upheavals and protest movements that will develop under a Labour government will create the conditions for a movement towards a new workers’ party. Labour’s failure to touch the problems facing the poorest sections of the working class will lead to explosions in the inner cities. The likely strengthening of the racist ultra-right under Labour will spur sections of youth into action against right-wing attacks. The single-issue campaigns, who perhaps feel that a Labour government will be more favourable to their cause, will come into collision with the Blair government. New Labour will not be repealing the Criminal Justice Act or withdrawing police and bailiffs from new construction sites. Above all, after a honeymoon period, there will be a growing movement of struggle by public sector, industrial, and other sections of workers. There will be massive struggles, with a searching for anti-capitalist policies as an alternative to New Labour’s collaboration with big business.
That is why the Socialist Party and the Scottish Socialist Alliance are fielding candidates in this general election. We want to see the defeat of the Tory government, but we have to warn of what will happen under a New Labour government. We shall be using our election campaigns to outline socialist policies to defend working class interests. We will be actively mobilising workers and youth who are looking of an alternative and will play a key role in the coming struggle to rebuild a mass socialist left in Britain.
Blair claims that 1997 will be an historic turning point, like the Liberal landslide of 1906 and Labour’s 1945 landslide, ushering in a prolonged period of New Labour reform. But it is not like 1945, which marked the beginning of an unprecedented – and unrepeatable – world-wide growth of capitalist production, which allowed scope for concessions to the working class. It is more like 1906. But perhaps Blair has not learned that their 1906 victory was the beginning of the end for the Liberals as a major, mass-based party: they were reduced to a small rump by the world war and the social upheavals which followed. The ‘era’ of New Labour will be short-lived. They have no real solutions. They will accelerate the re-emergence of mass workers’ struggles and a revival of socialism amongst millions of increasingly class-conscious workers.
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