(Militant No. 387, 6 January 1978, p. 6-7)
“The average voter has just suffered the biggest fall in his real disposable income for more than 100 years” [‘Economist’, 8th October 1977].
This is a fitting epitaph for 1977. Millions of British workers will not be sorry to see the back of the past year. For them it has been the worst in living memory.
Unemployment has spiralled from 1¼ million at the beginning of the year to 1½ million at the end. The talk of Britain’s “financial success” has a hollow ring for those out on the stones.
The average take-home pay of a married man with two children on average earnings: “is less than when the last Labour government lost the 1970 election” [‘Financial Times’ 6.12.77]!
For the poorest sections of the working class, 1977 has been a disaster. Thirteen million British workers, one quarter of the population, live below the poverty line! These workers have suffered agonies in the past year.
In many ways their lot is worse than in the 1930s. Thus in the past the destitute and homeless were accommodated in the workhouses. As monstrous as this was, the workhouses at least offered some refuge from the elements. Now they are compelled to accept bed and breakfast accommodation which means homeless families tramp the streets during the day, sometimes in bitterly cold winter weather.
According to official figures homelessness has doubled in England and Wales between 1971 and 1975 to 50,420!
Contrast this with the opulence of the rich. At the CBI conference in November while delegates filled the air with denunciations of “greedy trade unionists”, “self-made millionaire” Alf Gooding complained that his suit was costing him £10,000 because of ‘iniquitous taxes’!
At the same time, because of the October price increases in school meals from 15p to 25p a day, 600,000 children have stopped taking school meals. One quarter of all schoolchildren now qualify for free school meals – a measure of the drop in living standards in the past period. But some children don’t take them because of the odium associated with it.
Moreover in Kent and Cambridgeshire the Tories have already returned to all the cruel indignities associated with the 1930s. Working class children on free school meals have been forced to line up in separate queues, file into dining halls through separate doors and are only allowed second helpings when the other children have had first opportunity! This is a foretaste of the conditions which the Tories and the ruling class would like to inflict on the working class as a whole.
These conditions are the outward signs of the frightful collapse of British capitalism which has continued apace in the past year. British capitalism now occupies the position which Spain held in the past.
The difference is that Spain lost its empire over a period of centuries and saw “the inglorious decay” of its economic and political power. Yet the loss of British capitalism’s empire and the attrition in its power has been telescoped into a much shorter period of the last three and a half decades. But for the post-war world economic upswing, which masked the process, this decline would have resulted in unparalleled social upheavals in Britain.
Capitalism Bankrupt
Now, with the drawing to the end of this upswing, all the chickens are coming home to roost. In the past year we have charted this collapse in the pages of ‘Militant’. Virtually every month the publication of figures on the economic performance of British capitalism are like another nail in its coffin. Outstripped and beaten on the world market they are increasingly losing out to Japanese, German, French and US capitalism in their own backyard, in Britain itself. Investment, which is the engine of capitalism, has dropped throughout the capitalist world; but in Britain it has slumped to catastrophic levels.
Thus, not withstanding the bold claims of Labour Ministers about the new dawn resulting from North Sea Oil, Oxford economist Walter Eltis pointed out in the ‘Sunday Times’: “real net manufacturing investment was £1,040 million in 1970, £791 million in 1974 and £365 million in 1976, a staggering fall of 65 percent. We are investing about 5 per cent more in 1977 than in 1976 which means we are investing 60 per cent less than in 1970” (his emphasis 4.12.77). Under the stewardship of the rotten capitalist class British society has been brought to the brink of ruin. In the post-war period they have squandered and wasted the treasure of the British people first in useless arms expenditure – in a vain attempt to maintain the position as a super-power – and then under the Heath government in an orgy of speculation in antiques, property, land, and other ready assets.
The manufacturing base of the British economy has consequently been gradually whittled away. Such is their demoralisation that some of their spokesmen have even floated the idea of giving up manufacturing and concentrating on “services” ie. income from investment abroad, insurance, shipping and tourism! Thus David Howell, lieutenant of Thatcher, reflecting the interests of the City, in the ‘Evening Standard’ stated: “the way would be open for still further expansion in immensely profitable service industries” (7.11.77)
Moreover, reflecting the naked cash calculation of the capitalists, he also remarks: “We should be encouraging both home and overseas investment, wherever the returns are the largest and longest”. In other words, Britain can vegetate as an industrial slum, with investment going abroad – which amounted to £1,833 million in 1976 – so long as the loot of the capitalists is piled higher.
The journal of big business, ‘The Times’ – in a fit of despondency – even raised the possibility of completely giving up steelmaking: ‘there are now serious doubts about the validity of Britain remaining in business at all, where general steelmaking is concerned” (22.1.77)!! The jobs of thousands of steelworkers are of little consequence to these worthies. With complete equanimity they suggest that 60,000 steelworkers should immediately be thrown out of work. This is the price which the working class is called upon to pay for the utter bankruptcy of their system.
Yet throughout 1977, this same journal and its editor – failed Tory candidate Rees-Mogg – has taken every opportunity to heap the blame for Britain’s collapse on the shoulders of the working class. The note he has struck has been taken up by the gutter press. Like a vicious wounded animal the British capitalists are lashing out in all directions.
But the facts speak against them. ‘The Economist’ recently pointed that “British wage costs per hour in 1976 [were] lower than in any other major industrial country; roughly half German rates and about 45% of American rates” (12.11.77). Thus with the cheapest wage rates in the advanced capitalist world the British employers are still incapable of competing with their rivals. British workers gave the longest working week in the whole of industrialised Europe. Less is spent on housing, education and health than in most other countries in Europe.
At the beginning of the year, the spokesmen of British and international capitalism, if not bristling with confidence, were faintly hopeful that their system could drag itself out of the depression. Yet all their predictions have been reduced to ashes. Targets for economic growth at the beginning of the year have been lowered with each passing month.
The target of 5½% growth in the capitalist world up to 1980 is now considered to be completely utopian. Unemployment is now endemic and the army of 15 million unemployed in the advanced capitalist countries is permanent and will be enormously added to in the next decade: “The world experienced nearly a decade of mass unemployment during the 1930’s and it is almost certain that the (admittedly milder) recession of the 1970s and the 1980s will last as long” (‘The Times’, 13.10.77). 10% of the youth in the industrialised world are unemployed. The figure for black youth in America is 40%.
The capitalist economists describe their own profession as the “dismal science”. This has a double meaning in the modern epoch. They are utterly bemused by, and pessimistic about the prospects for their system. Thus in September, the economic correspondent of ‘The Times’ declared: “confidence is all gone, vanished with the monthly downward revision of their growth estimate for this year… the truth is we just do not know” (28.9.77)
Faced with this situation, the capitalists in each country have sought to unload the burden on to the others. Like a pack of wolves chained together they have begun to snap, snarl and bite one another. American and British capitalism urge Germany and Japan to “stimulate” their economies through state expenditure. The latter reply politely, “you first”.
All the major capitalist powers denounce Japan for her massive 10,000 million dollar trade surplus. American imperialism has introduced protectionist measures recently in the steel industry and is seeking to compel Japan to cut “tariffs.” She has, moreover, connived at the devaluation of the dollar s as to cheapen her exports which will strike a blow directly at Japanese and German capitalism. At the same time, protectionist measures – in a disguised form through state subsidies to domestic industry – have increased in all the advanced capitalist countries in the past period.
Unlike in the ‘50s and ‘60s there is no tranquil haven in the capitalist world. Sweden and Germany, which in the past were held up as a model of class harmony and inoculated from economic crisis, in the past year have caught up with the rest of the capitalist world. The economic and social convulsions which have shaken the rest of the capitalist world throughout this decade will develop in Sweden and Germany in the coming period.
But it is the developments in the weaker countries of the continent in Southern Europe, that the future development of world capitalism is clearly shown. Gout starts in the big toe and goes to the heart. In Spain 1977 has been a year when millions of Spanish workers have poured onto the political arena. There has been a virtual conspiracy of silence on the part of the press in Britain concerning events in Spain, Italy, Greece and Portugal. It is as if the capitalist press fears that the British workers would be infected by the revolutionary virus.
To give just one example, 3 million workers came out in a general strike and demonstrations in Andalusia in December. Half a million workers gathered in a public meeting in Seville to listen to one of the Socialist Party MPs, Guerra, denounce the shooting of demonstrators in Malaga. This warranted just a paragraph in the pages of the “serious” press, like the Times, and hardly a mention in the “popular” press! The colossal power of the Spanish workers has been demonstrated again and again in the past year.
Without the restraining hand of their leaders, the Spanish workers would undoubtedly have overthrown the Juan Carlos regime – and the capitalist system that spawned it. The Socialist Party (PSOE) leaders, and more particularly the Communist Party leaders (PCE), have collaborated with the ex-fascist Suarez in an “austerity programme” – the Moncloa Pact, which if implemented with wreak havoc on the Spanish workers.
Santiago Carrillo, the PCE leader, in particular has grovelled before the Suarez regime and international capitalism. Thus he described Suarez – whose police had shot workers in the back in Malaga – as a “patriotic Spaniard and democrat.” It was not so long ago that Carrillo’s counterparts in the Portuguese CP were describing Spinola in similar terms! At the same time Carrillo was prepared to cross picket lines at Harvard University – despite the appeals of American labour and trade union leaders – in order to demonstrate to his American hosts that he has no intention of seriously challenging Spanish capitalism.
Marxism Attracts Workers
Similar upheavals have also shaken Italy throughout this past year. The year has drawn to a close against the background of a mighty demonstration of a quarter of a million workers in Rome. The festering discontent of the Italian masses has brought into question the continuation of the Andreotti government.
The Communist Party (PCI) has propped up this government in the past year. Now the opposition of its own supporters has compelled the PCI leaders to come out against Andreotti. But the PCI leaders propose not a class alternative – a government of the workers’ parties on a socialist programme.
At a certain stage the PCI leaders will enter a coalition. The capitalists will cynically attempt to use them to demoralise the Italian workers by unloading on their shoulders the burdens of the crisis. They will be used as a screen behind which the ruling class will prepare to settle accounts with the working class.
Never before in history have the working classes of the advanced capitalist world been stronger. In numbers, cohesion and ability to struggle they far exceed anything seen in the past. But never in history have the leaders of the workers’ organisations been more cowardly and unequal to the tasks which are posed before the working class. The era of reforms, and the sugary illusions of steady improvements in living standards have disappeared.
What was given with the left hand the capitalists now seek to take back with the right. No lasting reforms are possible on the basis of a continuation of capitalism. Defence of the rights and conditions gained in generations of struggle – let alone any improvements – is bound up with the need to carry through the socialist transformation of society. Under the hammer blows of the stormy events of the past period the rank and file of the workers’ organisations have become more and more conscious of this fact. Within the mass organisations of the working class the rank and file have groped towards the programme and policies of Marxism.
In Greece, where PASOK, the socialist party, almost doubled its vote in the December Election, in Spain and Portugal, opposition currents to that of the leadership have developed.
‘Militant’ has consistently argued that it is from within the mass organisations of the working class – in the first case the Socialist Parties – that the forces which can lead the working class to victory will come. It is to these organisations that the masses will first turn seeking answers and a programme to solve their problems. At a time when those like ‘Tribune’ dismissed the PSOE, we alone predicted that from a small organisation numbering thousands it would become a mighty force with millions of workers lining up behind its banner.
This has been dramatically confirmed in the past year. The workers’ parties received over 42% of the vote in the Spanish general election with PSOE as the biggest party. What an answer to all the sceptics and fainthearts! By the murder of one million workers and destroying all democratic rights and the workers’ organisations, the Franco fascist regime considered that it had burned the ideas of socialism and Marxism from the consciousness of the Spanish workers. Forty years later powerful organisations, which formally at least, adhere to Marxism, have arisen on the bones of the fascist dictatorship.
In Britain also Marxism through the influence of the ideas and programme of ‘Militant’ has become a powerful trend of opinion within the Labour Party and Trade Unions. The year opened with the hysterical witch-hunt which had been launched by ‘The Times’. The strategists of capital in Britain have understood that the worsening conditions of the working class has been reflected in the shift towards the left in the labour movement. Prentice has taken his rightful place in the Tory Party. Tomney has been removed by the rank and file in Hammersmith and Walden and Jenkins have deserted for lusher pastures.
In the past, the capitalists effectively controlled the Labour Party through the right wing “infiltrators” who echoed their ideas within the movement. The witch-hunt demonstrated that they were now attempting to pick the rank and file of the movement!
Witch Hunt Defeated
At the same time, unprecedented financial and other support was given to right wing interlopers into the labour movement in Newham. The capitalist law courts brazenly assisted them in an attempt to thwart the democracy of the labour movement.
Only the courageous resistance of the rank and file of Newham – with ‘Militant’ supporters prominent in the leadership – compelled the courts to beat a retreat.
The witch-hunt was defeated. However it is not excluded that the myopic right wing will not try again. Like the Bourbons they forget nothing and learn nothing! Their target is not just the ‘Militant’ but the left as a whole and the democracy of the labour movement.
But it is impossible to defeat ideas by organisational means. In vain they try to separate Marxism from the labour movement in Britain. On the contrary the march of events will confirm again and again the correctness of our programme.
For the last two and a half years the British working class tolerated cuts in living standards on the promise that unemployment would be cut and prices would be slashed. Unemployment has gone up by a million while prices have come down in the past period only because of world factors. It is expected that they will begin to climb again in 1978. Enormous discontent has been accumulating throughout this period. This has burst out in 1977.
Again the press has suppressed the real mood amongst the workers particularly when gains have been made for fear that this will be contagious. Thus in 1977 the number of strikes was more than three times the 1976 level. In private industry the level of wage settlements was about 15% and is expected to climb to 20% in the next period. Yet the firemen have been driven to strike action and Christmas on the picket line by the Government’s decision to stick to the 10% limit.
At the same time the firemen’s strike has shown the huge fighting capacity and determination of the British workers once they are on the move. The capitalist press undoubtedly thought they could repeat the dirty methods that they used against the power workers and beat them back to work. But the rest of the working class rallied magnificently behind the firemen with massive collections, donations from old age pensioners etc, on the picket line.
Moreover the middle class was overwhelmingly sympathetic with shopkeepers displaying notices supporting the firemen. This is an answer to the right wing in the Labour Party and a confirmation of the arguments of Marxism. We have pointed out that if the labour movement was to adopt a bold socialist programme and carried it out in practice then this would result in the mobilisation of the downtrodden workers kept in the dirt by the capitalists – and the middle class – behind the banner of the labour movement.
1977 has furnished further proof that under the leadership of the right wing defeat and disaster faces the labour movement in the coming years. Earlier this year James Callaghan, when quizzed by Labour MPs about how to bring down unemployment replied: “I don’t know the answer”. Could there be a clearer confession of bankruptcy?
Capitalist commentators have positively gloated over the measures which the Labour Government have introduced. Thus, in the ‘Financial Times’ recently, Joe Rogaly, on behalf of his capitalist readers wrote: “I cannot for the life of me think of any reason why anyone should continue voting Conservative at the next General Election. In terms of what Mrs Thatcher’s Tories have to offer we are already served as about as good a conservative Government as we are likely to get.. Mr Callaghan’s Government has sat out a level of unemployment that no Conservative would have dared to accept… Is there a Conservative Home Secretary who would behave very differently from Mr Merlyn Rees? A Secretary of State for Social Security who would differ radically from Mr David Ennals [who recently brushed aside the loss of 20,000 hospital beds in the last three years – PT]!” (29.11.77)
The Stock Exchange seemingly agreed with his analysis when it slumped earlier this year at the prospect of the Labour Government’s fall and its replacement by Thatcher! This was the first time in history that the possibility of a Tory Government filled the Stock Exchange sharks with foreboding.
It is an annihilating comment of the policies of the Labour Cabinet. The capitalists are prepared to tolerate the government so long as it does their bidding. When it can no longer sell further cuts in living standards it will be brought down – possibly in 1978.
The policies of the present government are paving the way for the return of a Thatcher Tory government. And the Tories have served notice on the British working class of what they intend when they come to power. Savage cuts in public expenditure – with ‘hotel charges’ for hospital beds, promised by Patrick Jenkins, Shadow Tory Health Minister, a massive increase in unemployment and Thatcher’s gray eminence, Joseph promising to try and sell off British Rail. Without a doubt a Tory government will mean a collision between the classes the likes of which has not been seen since the General Strike.
Only the adoption of a Marxist programme can save the British workers from the nightmare of Thatcherite Toryism. The Labour Government has been forced to preside over cuts in living standards not through malice aforethought but because it remained within the framework of capitalism. Not just the right wing but even those trade union leaders like Jack Jones who stood on the left of the labour movement imagine that the conflict between labour and capital can be reconciled by ‘conciliation’, ‘negotiation’, and ‘compromise’.
On the contrary British capitalism is so enfeebled and decrepit that it cannot tolerate any lasting or serious reforms. Even those measures like the Employment Protection Act, The Health and Safety Act etc. are irksome to the capitalists in their lust for profits.
It is not at all accidental that a vicious campaign against the closed shop has been launched. This has been backed up by the judgement of the “bovver boys in ermine” in the Lords, with their judgement against the Grunwick strikers.
The ruling class is forced to tolerate the trade unions today. But the power of the workers’ organisations and particularly the trade unions, they consider an intolerable hindrance to their “divine right” to rule and their plans to empty millions of “redundant” workers out of the factories.
Even now the Time threatens civil war in the future unless the trade unions come to heel. It bluntly stated on the 14th September that the discussion on the trade unions today: “is like looking forward to the assertion of parliamentary authority in the 1630s.” The English Civil War followed in the 1640s.
Every thinking worker should ponder the significance of these words of the organ of big business as we move into 1978. Unless the gigantic power of the British workers is used to effect the socialist transformation of society then all their painfully acquired rights and conditions will be endangered; not immediately but in the next decade or so. But the time to prevent this happening is now!
The labour movement equipped with a Marxist programme would be invincible. The taking over of the 200 or so monopolies through an Enabling Act would mean that the resources of society could be organised and planned for the benefit of the majority instead of the tiny handful of millionaire parasites. As we have pointed out in ‘Militant’, something like £20,000 million has been lost through unemployment in the last three years! The steel industry in the Common Market is expected in 1978 to have 40% of the plants lying idle.
Imagine the limitless possibilities which would open up on the basis of a rational organisation of production and society. Jack Jones pointed out in the early 1970s that if all the resources of capitalism – kept idle because it pays the capitalists to do so – were used then it would be possible to introduce a 19 hour working week. All that stands in the way is rent, interest and profit.
A democratic socialist plan of production drawn up and implemented by committees of trade unions, shop stewards, housewives and small businessmen would result in a gigantic leap forward of the economy which would dwarf anything yet seen. It would mean a massive increase in spending on the social services, and at least one million houses a year; the elimination of poverty. At the same time a socialist Britain would be a beacon to the workers of Europe and the world.
An indispensable part of the process of winning the labour movement to this programme is the building of the sales and the influence of the ‘Militant’. 1977 witnessed a tremendous development of our journal and the magnificent sums raised in our Fighting Fund. It is fitting that 1978 has opened with plans for the launching of the 16-page ‘Militant’. Make this the year when ‘Militant’ is taken to ever new layers and all corners of the labour movement and the working class. In this way we will be forging a weapon which can assist us to build a new Socialist Britain and a new world free from all the horrors of capitalism.
Peter Taaffe
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