(Militant International Review, No. 48, Summer 1992, p. 2-8)
The Tories have won a fourth successive victory but, argues Peter Taaffe, Britain’s underlying economic and social malaise continues.
„The economic situation in Britain has reached extreme acuteness. Still, the political superstructure of this arch-conservative country extraordinarily lags behind the changes in the economic basis. Before having recourse to new political forms and methods, all the classes of the British nation are attempting time and again to ransack the old storerooms, turn the old clothes of their grandfathers and grandmothers inside out … it will in all probability take more than one month, perhaps more than one year, for the political superstructure to become adapted to the real economic and international situation of the country.“
These lines were written by Leon Trotsky shortly after the coming to power of the 1931 ‚National‘ government. On the basis of the catastrophic economic position of British capitalism, Trotsky correctly anticipated huge social upheavals. Yet the commentators of the day were mesmerised by the crushing parliamentary majority of the National government, just as their counterparts today are by Major’s puny 21-seat majority.
Strikes convulse Germany. A momentous general strike grips Spain. Flames consume Los Angeles. One country after another in Europe, let alone in the former colonial and semi-colonial world, is racked by social upheavals and strikes. And yet the spokesmen of British capitalism, echoing Voltaire’s Dr Pangloss, believe that ‚everything is for the best in the best of all possible worlds‘. The election afterglow is summed up by The Financial Times: „Britain is now an island of stability.“
Violent mood swings, as is well known, are usually associated with a disturbed personality, in this case a chronically unstable class. Before 9 April the British ruling class, through its spokesmen, expressed morbid fears for the future, for society and its own long-term prospects. Major’s general election victory, as much an astonishment to himself as to most other people, has now acted as a giant ‚upper‘ for the British bourgeois.
Their euphoria has been bolstered by the dejection of the right-wing Labour leaders in the aftermath of the election debacle. Seeking to unload responsibility for this defeat from their shoulders, where it belongs, onto the working class, one after another they have declared that we are in for ‚one-party government‘ for the foreseeable future. Their refrain is: if we can’t win in a recession, when can we win‘, or ‚the people voted selfishly‘.
It was not preordained that the Tories would win
They have been joined by other superficial commentators, who for some reason imagine that they are ‚Marxists‘, claiming that it is the effects of the 1980s boom which explains the fourth victory in succession of the Tories. It is true that the legacy of the boom has left traces in the outlook of big sections of the working class. Trotsky himself commented that in no other country was the religion of capitalist progress more firmly based than in Britain in the past. It was this hope for a return to the ‚good old days‘ of the 1980s – more a triumph of hope over experience – which compelled many unenthusiastically to either cast their vote for Major on April 9 or to abstain. Yet it was not preordained that the Tories would win. On the contrary, the objective situation in Britain posed the possibility of defeat for the government. Britain has experienced the longest if not yet the deepest recession for sixty years. Home repossessions devastated the lives of more than 80.000 families last year alone. Their experience of Thatcher’s ‚property-owning democracy‘ is eviction, invariably followed by a miserable existence in ‚bed-and-breakfast‘ accommodation
These factors, together with the savage attacks on the health service and education, and with the memory of the poll tax still fresh, should have been decisive in removing the Tories from power. That they weren’t was entirely the responsibility of Kinnock, Smith and their ’shadow cabinet‘. Andreas Papandreou, leader of the Greek Socialist Party PASOK, commented that Labour’s defeat arose from the fact that Labour ‚were no different‘ from the Tories. Papandreou, adept at verbal radicalism, makes a more accurate assessment of the British general election results than some alleged ‚Marxists‘.
* * *
In reality, as in 1983 and 1987, the bourgeois commentators, and echoing them the Labour right-wing, have unleashed a huge ideological campaign to paralyse the will to struggle of the working class. The first fiddle in this chorus naturally belonged to the ‚communist‘ renegade, Martin Jacques, former editor of Marxism Today, who, days after the election, declared that „the Conservative Party has become the permanent party of government just like the Liberal Democrats in Japan, the Christian Democrats in Italy and, until recently, the Social Democrats in Sweden.“ (The Observer, 12 April, 1992).
Entirely escaping the notice of this drawing room socialist is the fact that the Japanese Liberal Democrats owe their ‚one-party domination‘ to the powerful economic engine of Japanese capitalism and the pusillanimous behaviour of the leaders of the Japanese Communist and Socialist Parties. The latter have recently been implicated in a series of corruption scandals, one involving a Socialist Party parliamentarian and a mobster! Tied as they are now to the ‚market‘, that is, capitalism, they don’t hesitate to push their snouts into the state trough like any corrupt bourgeois politician. This is an international phenomenon. Their counterparts in Italy – not just the corrupt Craxis of the Italian Socialist Party but now also members of the former ‚Communist‘ Party in Milan – have dirtied their hands. So have the ‚Socialist‘ leaders in France. as well as other European ‚Social-Democrats‘. All have been found to have their hands in the state till.
In Italy moreover, the former ‚one-party‘ regime of the Christian Democrats is coming apart at the seams. The glue holding the disparate factions together in the past was the spectre of ‚communism‘. The leaders of the former ‚Communist‘ Party, the PSD, have openly embraced capitalism, and all the fissiparous tendencies within the Christian Democrats have come to the surface.
The economic and social situation in Britain bears no comparison to Japan in the past or even to Italy today. The underlying sickness was disguised by the election result. The argument that ‚if Labour can’t win in a recession it never will‘ is entirely facile. When faced with economic uncertainty, it is not unusual that the mass of the population will cling to ‚the devil they know‘. Thus in 1935, notwithstanding the devastating effects of the inter-war slump and the savage attacks on the living standards of the British workers, the National government was nevertheless re-elected.
This process is re-enforced when ‚the devil that they don’t know‘ offers an uncertain future, or the impression of pain for many of them. This is precisely what Labour’s programme, particularly in regard to tax, meant for millions who would otherwise have been swayed into supporting Labour. Militant argued against the disastrous impression which the tax measures of Smith and Kinnock gave to skilled workers and sections of the lower middle-class. It was not difficult to anticipate this. Hattersley had committed precisely this blunder in 1987 with baleful consequences for Labour.
It is true that the Tory tabloids, as always, told the most barefaced lies about Labour’s ‚tax nightmare‘. Yet this propaganda would not have rooted itself in such fertile soil unless the Labour leaders‘ own words and actions had not ploughed up the ground for it beforehand. Add to this the organic ambivalence of Kinnock – refusing point-blank to take a position, for example, on proportional representation – and a programme no different from the Tories in fundamentals, then another defeat for Labour could not be ruled out. The election edition of the MIR certainly did not discount this possibility.
‚Society is moving to the right‘, is now the refrain. Yet 9 April in no way vindicates this false analysis. It is true that the Tories remained at 42% of the poll with 14 million votes, 7% ahead of Labour. But 1.6 million more voted for Labour compared to 1987. Add the one million who dropped off the electoral register, probably to avoid the poll tax and in all likelihood Labour inclined, and the gap between Labour and the Tories is not as great as bourgeois commentators have argued. Certainly, given Britain’s electoral system, just a handful of people, less than 3,000, would have needed to have voted in the eleven closest seats for parties opposing the Tories and Major would have lost his Commons majority. There are in addition 22 seats with Tory majorities of under 1,000.
More importantly the performance of Marxist candidates in Coventry, Pollok and Broadgreen completely undermines the ‚move to the right‘ argument. The marvellous result of Tommy Sheridan, coming ‚from nowhere‘ to record more than 6,000 votes, is a living rejection of this idea. Dave Nellist came within a hairsbreadth of winning in Coventry and Terry Fields recorded a magnificent 5,900 votes despite the calumnies and distortions which he and Militant have endured in Liverpool in the past period. Demonstrating that his marvellous result in the general election was no ‚fluke‘, Tommy Sheridan was elected from his prison cell as a councillor for Pollok one month later. These results foreshadow future successes for Marxism in the storms which loom ahead in British society.
* * *
There has been a determined attempt by capitalist commentators to refurbish Major’s ‚liberal‘ image. His regime, if we are to believe them, represents a departure from Thatcherism. It is true that the Queen’s speech attempted to refute the impression that a frontal assault is to be made on the rights and conditions of the working-class. A tiger can pleasantly droop its eyelids and sheathe its claws, but it nevertheless remains a tiger and will show that when cornered.
The ferocity of Thatcherism arose from the long-term decay of British capitalism and the collision between the classes which this engenders. But she completely failed to restore the former power of British capitalism. There is not a glimmer of long-term hope to be found in any of the analyses of the serious economic commentators. The Thatcher ‚miracle‘ is now utterly discredited. Unemployment rose by 150% from 1.1m to 2.6m officially. In reality, it stands at almost 4m. The average rate of growth of the economy was 1.5%, far less than during the 1960s and 1970s. Manufacturing output is at the level it was 12 years ago and absolutely lower than the level it was 18 years ago. Just five million workers, only 22% of the labour force, now work in manufacturing industry, the lowest number in a hundred years.
The problems have inexorably piled up. The bill will have to paid in the stormy period we are now going into. The escape routes which Thatcher luckily discovered in the 1980s are now closed off. There will be no world boom which can cover up the underlying disease of the British economy. Indeed the tremors on the Tokyo stock exchange, together with the strikes in west Germany, could presage a further slowdown in these economies leading to a generalised recession or a marked slowdown throughout the capitalist world. On the other hand it is possible that a unsynchronised spluttering recovery could begin this year. Japan and west Germany could stagnate or experience a further slowing-down in their growth rate while the US and Britain slowly climb out of the economic trough. In any event little hope exists for the bulk of the 30m unemployed in the advanced industrialised countries being absorbed back into industry.
The collapse of the huge property company Olympia and York (O&Y), both reveals the underlying problems of British capitalism and threatens to enormously aggravate them, The mad dash to construct office space in the 1980s – as if the boom was never-ending – was typified by O&Y’s decision to build Canary Wharf. This now threatens to become a huge white elephant, as its office space will probably never be fully occupied. There is 40m square feet of empty office space in London, 20% of the total stock. This compares with a vacancy rate of 10% in 1974, the last time there was a major property collapse.
Olympia and York have piled up accumulated debts of £6.7bn worldwide. But they are not the only property company which has overreached itself. Moreover, the big banks have an estimated £50bn directly or indirectly tied up in property loans. In the early 1970s a similar situation arose, with the Heath government stepping in to rescue the ’secondary banks‘. If they hadn’t then the whole banking sector would have been plunged into crisis, which in turn could have precipitated an industrial crisis. Ultimately it was the working class which footed the bill in increased taxes, as they will this time round if the government intervenes.
At present this government seems to have a ‚hands off‘ approach. In so doing they risk precipitating a property collapse. In any event, the huge expensive empty office developments, which mock the plight of the London homeless, are a fitting epitaph to Thatcher’s ‚miracle years‘. They also epitomise the growing ‚excess capacity‘, in turn an expression of its incapacity, which will typify British capitalism in the 1990s.
Over the last two years manufacturing investment has fallen by a third with output down by 10% and employment collapsing by 600,000. Last year alone manufacturing capacity fell by 4%, which means that even if there is an upswing British industry will be incapable of satisfying demand. As a consequence imports will flood in, aggravating the already chronic balance of payments crisis. Import penetration in manufacturing goods – i.e. the ratio of imports to demand at home – has accelerated every year from 26.2% in 1980 to 30% in 1989.
Even a growth in the economy, expected to be anaemic, will not prevent the inexorable rise in unemployment. A one million rise in unemployment adds an extra £8bn to government spending, through lost tax revenue, unemployment benefit, etc. The public sector borrowing requirement (PSBR ) admitted by Lamont to be a huge £28bn, could spiral to £32bn by the end of this year, and to £40bn or more in two to three years.
The Tories are desperate to plug the gap between government income and expenditure. They will curb public expenditure but the other dimension involves attempts to boost economic ‚recovery‘ and thereby increase tax revenues. Hence the 0.5% decrease of the base lending rate which, coming as it did just before the local government elections, had the added advantage of helping the Tories on the electoral field. However, economic Nemesis beckons for the Tory government. Corporate as well as personal indebtedness, the ‚debt overhang‘ harped on by bourgeois economists, is acting as a brake on any economic upswing, not just in Britain but throughout the capitalist world as a whole.
* * *
It is the underlying malaise of the British economy which will compel this government, notwithstanding Major’s blandishments, to launch an offensive at a certain stage against the rights and conditions of the British working class. The ballooning government deficit is a guarantee of savage attacks on the public sector. There will be either tax increases, that is indirect taxes. or the slashing of government expenditure, or, more likely, a mixture of both.
The appointment of the arch-monetarist Thatcherites, Portillo and Lilley. to jobs which involve the cutting of government expenditure is not at all accidental. The Queen’s speech revealed the preparations for partial de-nationalisation of British Rail and the outright selling-off of British Coal. Thirty thousand railwaymen and thousands of miners could lose their jobs.
The serious strategists of capital sense a looming clash.
The more serious strategists of capital sense a looming clash. Their unease was voiced by the Archbishop of Canterbury with his denunciations of the high salaries of directors and managers. In the wake of the Los Angeles riots we have had the outbursts in Coventry. In trepidation bourgeois commentators warn that „when the grievances of the dispossessed find no outlet in the political system they reach for alternatives.“ (Guardian, 11 April 1992). No less than in America, the accumulated rage gathered in the inner cities could explode in the next period. Elements of the ‚third world‘ exist in most of the major cities of Britain.
The outbreak of dysentery, a disease usually associated with the slums of Calcutta, has spread like a plague from Scotland to Greater Manchester to Yorkshire and now to the West Midlands. This shows the degradation which many of the poor have been forced into. During the first 15 weeks of this year, according to The Independent, 28 April 1992. a total of 7,500 cases were reported in England and Wales compared with 1,708 in the same period in 1991.
Now the schools, traditionally offering some kind of lifeline out of poverty, are to be crushed by the government’s ‚reforms‘. The local management of schools (LMS) has fed to the threat of redundancies amongst thousands of teachers. The crisis in education sums up the organic crisis of British capitalism. In the boom the ruling class needed an educated, technically equipped workforce. Now what is required is a highly trained elite, while the rest receive an inadequate basic education, which fits them for part-time low paid employment.
In the colleges and universities the increased ratio of students to teachers, together with the general impoverishment of students, has laid the ground for clashes to develop. Conditions similar to those which lead to the explosion in France in 1968 are maturing, not just in Britain but on a European scale. Add to this the savage attack planned on low paid workers, whereby the „abolition of wages councils will turn Britain into the sweatshop of Europe“ (Low Paid Unit), and a potent brew of social, political and industrial upheaval is posed for Britain in the period we are going into.
* * *
Class polarisation will inevitably develop. This will, in turn, introduce new divisions into the Tory Party. Some commentators have compared Major’s 21-seat majority to the ‚comfortable‘ 12-seat majority enjoyed by Churchill in 1951-55. Yet the objective situation now confronting Major is entirely different to Churchill’s position then. The Tories in 1951 came to power at the beginning of a long economic upswing for British and world capitalism. Major presides over an unprecedented slide in the economic power of British capitalism. Like Dickens’s Uriah Heep, he will, with a smile and ‚ever so ‚umbly‘, attack workers‘ living standards.
The strategists of capital have, however, learnt a little from the brutal reign of Thatcher. Despite all their warnings, bolstered by a 100-plus seat majority, she pushed through the poll tax. True, she paid dearly for this, but so did the British capitalists who confronted the largest mass civil disobedience campaign in British history. This has left an indelible impression on social relations in Britain and on the outlook of workers in particular.
Determined not to have their fingers burnt once more, right from the outset the government was given a warning by its Tory critics. In its first parliamentary test, over the election of the Speaker, the government saw its own candidate rejected in favour of Labour’s Betty Boothroyd. The opposition was mobilised by Tory John Biffen, rather than Labour’s front bench!
This was followed by the resignation of a Tory junior minister over the Maastricht treaty vote and the Commons revolt on the same issue. Add to this the constant carping of Thatcher – with her claim that there is ’no such thing as Majorism‘ – together with the new Tory right-wing parliamentary intake, and the scene is set for an even greater clash between the different wings of the Tory Party.
There is a San Andreas fault line between ‚wets‘ and Thatcherite ‚hards‘ which runs right through the modern Tory Party. It is an open question as to whether Major’s government will see out its full term of office. Notwithstanding the tame opposition served up by Labour’s front bench, the social earthquakes which are coming can splinter the government.
* * *
The election defeat represents a turning point for the consciousness of the British working class. The ceaseless refrain ‚wait for a Labour government‘ cuts no ice. Nor will the attempts of those like Jordan, leader of the new Amalgamated Engineering and Electrical Union (AEE), to seek an accommodation with the employers and the government. Jordan praised the appointment of Gillian Shepard as Employment Secretary as a sign that the Tories were seeking ‚more consensus‘ in industry. He suffered a brutal rebuff in the Queen’s speech where further attacks on the trade unions were signposted, including moves to eliminate the ‚check-off system‘ of paying union dues. Further legislation allowing union officials and shop stewards to be sued for calling strikes is being contemplated.
‚UK wage inflation must fall, and soon.‘ Financial Times
The economic situation will compel British capitalism to launch an offensive against the wages and conditions of the British workers. The Financial Times bluntly declared „UK wage inflation must fall, and soon.“ But the spokesmen of British capitalism look with trepidation at the development of ’super-unions‘. They have pondered the lessons of the recent strike wave in Germany where huge concentrated union federations have shown the power of the working class once it moves into action. Even the merger of the AEU and the EETPU, while carried out in a bureaucratic fashion, is correctly perceived in the long-term as a huge potential threat. The Financial Times growls with alarm, in particular, at the possible merger of NALGO, NUPE and COHSE. It even suggested that „there could be a public interest case for regulating union mergers in the same way as industrial mergers, to curb the abuse of monopoly power.“ (10 April 1992).
For decades the British bourgeois bemoaned the existence of dozens if not hundreds of unions with which they were forced to negotiate. They looked wistfully towards the ‚disciplined‘ unions in Germany. But such is the dialectic of history that they now correctly perceive the gathering together of huge concentrations of workers under one union banner as a colossal potential threat to them and their system. This threat would be all the greater if these amalgamations of unions took place through the democratisation of the union structures, and with greater rank-and-file control. The union tops, however, see mergers, in the main, as an attempt to shore up the powers of the trade union officialdom. Nevertheless the process of amalgamation in the long run will serve to enhance the power of the working class and their organisations, particularly when the rank-and- file move, as they inevitably will, and shift these organisations towards the left, thoroughly purging them of bureaucratic habits, methods and leaders.
This growing mood was shown in the union conferences held even in the first few days which followed the election. At the NUT conference, for example, the delegates reflected the growing alarm at the Tories offensive in the schools and the preparedness of teachers to resist. Only with difficulty, and by persuading the conference to adopt contradictory resolutions, did the union leadership manage to deflect the clamour for action coming from the ranks. Nevertheless, at local level, votes in favour of strike action to prevent redundancies have taken place.
At the USDAW conference, the shopworkers‘ union, the shackles placed on the delegates by the union tops began to be thrown off. There were demands for action on wages, to resist the offensive of the employers against shopworkers“ conditions, and for the involvement of young members through special ‚youth committees‘. Supporters of Militant, previously kept at arms length by the delegates, were warmly accepted on this occasion. The union ranks had been told that expulsion of Militant was the price to be paid for Labour’s general election victory. Instead a Tory government was once more installed in power and the delegates raised their voices in opposition to further witch-hunts in the Labour Party.
It is true that last year the number of strikes in Britain was at a hundred-year low. This reflected the effects of the recession, and the restraining hand of the union leaderships. However, within weeks of the general election, a series of disputes have bubbled up, particularly in the London area. Successful strike struggles have been conducted on the building sites of London, under the auspices of the newly formed magnificent ‚Joint Sites Committee‘. Tube workers balloted in favour of strike action to compel London Transport to step back from compulsory redundancies.
Local government will be a key battleground.
Big battles loom for the unions in the local authorities as the government moves in the direction of the ‚Americanisation‘ of local government, seeking to strip councils of most of their powers in education, housing etc. Already Harrow council has announced that all national pay bargaining arrangements for their workers, except teachers, will cease. Twenty-five councils, largely Tory, have taken this road in the last two years. Harrow, however, is the first one in London to declare war on the local authority unions. The employers‘ offensive will be against wage rises, already running at an allegedly ‚unacceptable‘ 7.5%, and against rights and conditions. In the civil service the government will inevitably move in the direction of ‚privatising‘, of splitting up and thus attempting to neuter the power of the unions. All of this will not go without fierce resistance from the working class.
* * *
Tory spokesmen have declared that Britain is a country ‚at ease with itself‘. This view is unfortunately echoed by the leaders of the Labour and trade union movement. John Smith has declared that Labour must direct its attention to the ‚contented majority‘. It seems that ‚one-third‘ are discontented, (they exist in poverty ) while ‚two-thirds‘ of the population are comfortably off. This is an entirely false picture of the situation which exists in Britain or for that matter throughout the advanced capitalist world.
There has been a huge widening between the rich and poor. A gulf has opened up between the classes. Even those workers with jobs and not too badly off at present, are insecure, faced with the ever-present threat of redundancies, house repossessions, etc. That this mood is not translated into parliamentary arithmetic in favour of Labour, is entirely the responsibility of the Labour leaders. But it is a law that the working class, checked on the parliamentary field, turns towards the industrial field. Added to this is the ‚extra-parliamentary‘ arena which will complement the battles which will unfold in the factories.
The remorseless undermining of previously accepted rights in the social sphere itself threatens to ignite an explosion. Already social services ‚experts‘ have urged the government to retreat on the denial of social security benefits to 16 and 17-year olds. This assumes even greater urgency in the wake of the Los Angeles riots and the riots in Coventry. The movements in industry, the resistance against the education ‚reforms‘, the battle to prevent the destruction of council housing; all will be reflected at a certain stage in the organisations of the working Class.
The trade unions will undoubtedly undergo a period of transformation. This at a certain stage will be reflected in a movement into the Labour Party. However, as Militant correctly predicted, the Labour Party leadership have moved even further towards the right in the aftermath of the election.
Smith and Gould vie with each other to distance themselves from the unions
Gould and Smith vie with each other to distance themselves from the trade unions. Some union leaders have supported this, while those like Sawyer of NUPE and Tuffin of the UCW demand some ‚residual‘ link. It cannot be ruled out that the right-wing will succeed this time in eliminating from Labour’s aims clause four, part four of Labour’s constitution, which enshrines the idea of the socialist transformation of society. It is even possible that the formal links with the trade unions can be broken or, at the very least, severely weakened. The Labour Party, moreover, will generally remain empty for the foreseeable future, as there is nothing in the policies or programme of either of the leadership contenders to inspire workers and youth to join.
But even if all of the Labour right’s ‚counterrevolution‘ is carried through, this would not fundamentally alter the character of the Labour Party. The British Labour Party, more than its European counter-parts, was an outgrowth of the trade unions, its ‚political expression‘. It is doubtful whether it can continue to exist, even as a parliamentary machine, without finance from the trade unions, unless the government decides to introduce the state financing of parties. This is not immediately on the agenda. It is possible that the British Labour Party could become like the German Social Democratic Party (SPD), which does not have formal trade union links. However once there is a deep-going movement of the proletariat this will inevitably be reflected within the Labour Party.
Some bourgeois ideologists fervently hope that it can be transformed into a British version of the American ‚Democratic Party‘. Such a hope is forlorn. It can however move much further to the right than at any other time in the postwar period. This will not be without opposition from the ranks of the unions or the Labour Party itself. Nevertheless splits, this time towards the left, cannot be ruled out. The outline of such a development exists in the formation of ‚Scotland United‘, led by George Galloway, Denis Canavan, and their supporters amongst Scottish Labour MPs.
A mass left reformist wing will only take shape within the Labour Party on the basis of big events, first of all on the industrial plane in the unions and then at a later stage reflected in the Labour Party. Therefore in the explosive situation that will develop in British society, huge scope exists for a force which can offer a fighting socialist programme.
Anthony King, the pollster, declared in The Economist, after a survey at the turn of the year recorded that 48% of the population accept the idea of a ‚mainly socialist society‘, that this was „no longer on offer in Britain.“ In fact such an ‚offer‘ was made to the workers of Pollok, Coventry and Broadgreen, and to those who were prepared not to pay their poll tax, and it brought forth a magnificent response. It was Militant who provided such an alternative in the big movements of an extra-parliamentary character, as well as on the electoral field in a limited arena, in the past period. While we remain orientated towards the mass organisations of the working class, given their present paralysis under right-wing domination, Militant will independently organise all those forces who are prepared to fight against the Tory and employers‘ offensive and for the socialist regeneration of the labour movement.
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