Blair and Brown continue to delude themselves that they have abolished the boom slump cycle. They will face a rude awakening. At the root of a new economic crisis will be the same old insoluble crisis of overproduction and overcapacity to produce. The inherent contradictions of capitalism have not gone away despite the fact that if the economy grows this year it will be the 14th consecutive year of boom. That boom has been based on a cruel combination of stress and strain at work for millions; a service sector based on illegal practices and the virtual slavery of migrant workers; credit and consumer spending; the continued destruction of public services and the disintegration of the country’s infrastructure; and, despite all the rhetoric about tackling poverty, a massive growth in inequality.
The yawning chasm between wealth and poverty, and its impact on health and education, represents a sharpening of the class division of society, dispelling the myths that we have all become middle class, homeowners etc. Conditions determine consciousness and the changing conditions of the working class are at the core of the class polarisation of society which will be a fundamental feature of the next period.
According to a report from the Office for National Statistics published in December 2004, the wealth gap in Britain has widened significantly since Blair came to office, with the top 1 percent of the population now owning 23 percent of all wealth, compared to 17 percent in 1991. The report entitled ‘Focus on Social Inequalities’ also shows that 25 percent of the population now own 75 percent of the wealth.
Income distribution is just as unequal with 10 percent of the population grabbing 28 percent of all income. There are 1.6 million individuals in the UK with an income above £1000 per week. Meanwhile 17 percent of the population live in “low income” poverty (defined as households with less than £194 per week). This represents a higher degree of inequality than most other EU member states.
Increasing inequality impacts on every aspect of life, as the report effectively demonstrates. In 1992, 60 percent of children with parents in managerial/professional occupations attained five or more higher grade GCSE’s, compared with 16 percent of children in ‘unskilled manual’ occupations, a gap of 44 percent. In 1998 this gap rose to 49 percent. Final year students in higher education are leaving with an average debt of £8666, with those in the highest amount of debt coming from the “lower social classes”, following the abolition of student grants. In 2001, 50 percent of young people from non-manual backgrounds (those from professional, managerial and intermediate occupations) participated in higher education, compared with just 19 percent of young people from manual social class backgrounds (those from skilled manual, semi-skilled manual and unskilled manual occupations), a gap of 31 percent. In 1960 the gap was 23 percent. People who manage to obtain a degree earn on average gross weekly earnings of £632 in full time employment compared to £298 for those with no qualifications.
Blair’s rhetoric about education being his priority became in practice the privatisation of schools and colleges, and the introduction of fees. These measures have had an obvious impact on students and the ability of those from working class backgrounds to continue their studies.
However another set of education statistics tells us a great deal about the long term decline of Britain too. Most adults lack the basic skills expected of GCSE pupils in reading, writing and maths, according to a report from the National Audit Office (NAO).
The report found that despite government efforts to get 750,000 adults enrolled on reading and writing courses this year, almost eight out of 10 adults aged between 20 and 65 would fail to get a good GCSE pass in maths and 60 percent of this age group were not at the level of GCSE grade C or above in literacy. In total, about 26 million people of working age “have levels of literacy or numeracy below those expected of school leavers”, it said.
The health of the population is also affected by the yawning chasm of wealth inequality, with differences in mortality rates between professional occupations and manual occupations showing a gap of 7.4 years for 1997-99. This is an increase of 3.6 percent for men since 1986. The difference in mortality for social class is reflected in regional differences too, with average male life expectancy in Glasgow at 68.7 years compared to 79.3 for North Dorset. Infant mortality rates are affected by socio-economic status with lower rates recorded for babies of managerial & professional groups compared to manual occupations. Mental health is also shown to be effected, with people in unskilled occupations more than twice as likely to suffer neurotic disorders compared to those in professional occupations.
Meanwhile the Health Service is understaffed, underfunded, undermined and under attack. Privatisation, contracting out, competitive tendering, PFI are not just economically crazy, in reality a licence to print money with no concern for the service provided, they are themselves now the cause of ill health.
The spread of the MRSA hospital superbug has been blamed on a 45% cut in cleaning staff since the NHS allowed the private sector to compete for the work. UNISON has published independent research showing there were 55,000 cleaners in the NHS in 2003-04, compared with 100,000 20 years ago.
The government disputed Unison’s claim that increased infection was linked to contracting out. Standards of cleanliness in 440 hospitals cleaned by contractors were much the same as those in 707 hospitals which had in-house teams, Lord Warner, the health minister, said.
He conceded however, that contractors were responsible for cleaning at the three trusts with the dirtiest wards and 15 of the 24 hospitals where the standard was rated poor.
Unison said an investigation by Steve Davies of Cardiff University showed competitive tendering drove down standards regardless of whether the service was eventually contracted out
Unbelievably it is not just the cleaning services which are being contracted out to unscrupulous companies who exploit low paid workers. A report on forced labour, commissioned by the International Labour Organisation and the TUC is being suppressed by the government until after the election. It tells of the violence and intimidation suffered by these workers at the hands of gangmasters; the appalling and dangerous conditions in which many of these workers are working; and the terrible debt bondage many of them are forced into, borrowing large sums to travel to Britain, repayable at exorbitant rates of interest deducted from their wages.
One example cited is of a group of 32 nurses brought here from Asia to work in private care homes and the NHS being paid just £46 a week after the deductions of their ‘employment agencies’. When they started working for the NHS their monthly pay of £805 was reduced to £198 (£46 per week) after deductions were made at source by NHS trusts and handed over to these ‘agencies’.
Felicity Lawrence of The Guardian has carried out a detailed investigation of the status of many of these migrant workers. Her report makes for unpleasant reading and confirms the further decline of Britain, and the extent to which the so-called success of the service sector is based on a super-exploitation of workers.
Subcontracted migrant labour has provided a workforce that can be turned on and off at a few hours’ notice depending on the workload to sectors that have seen strong growth – food production and processing, construction, catering and hospitality, health care and contract cleaning – enabling the organisations that use it to compete globally.
The underworld of gangmastered labour that was glimpsed when 23 cockle pickers died at Morecambe Bay last year is spread like a web throughout the country.
One of the leading companies involved in food production, for example, is Natures Way Foods. It washes and packs over 14bn salad leaves a year for British consumers. Set up in 1994 at the suggestion of Tesco to supply all its branches with salad, it depends on migrant labour. It employs many of its local and foreign workers direct but it and its sister companies have also used a succession of agencies or gangmasters. The Natures Way website boasts of the “phenomenal growth” the company has achieved with backing from Tesco: “Our first four years were so successful... our business doubled in size every year ... In December 1999 we were placed 29th in the Fast Track 100 of the country’s fastest growing companies.”
Between 1996 and 1998, Natures Way was the fastest growing food company in the UK, a meteoric rise that mirrored the rapid growth in profits at its sponsoring retailer. It is now also a major supplier of salad to McDonald’s. It is owned by the Langmeads, a large landowning family that have farmed in the Sussex area for over a century. The two Langmead brothers have turned their farming business into an international operation that grows, imports, and packs food all year round through various related companies.
Natures Way has relied upon a flexible workforce, with migrants prepared to work long and unpredictable hours and gangmasters able to move them around the country at short notice.
Georgi was among a group of Bulgarian workers interviewed by The Guardian who were being supplied to Natures Way by one of its principal gangmasters, Advance Recruitment. They had arrived on business visas for the skilled self-employed but were packing salad for Tesco. Skilled self-employed business visas were the subject of a scandal earlier this year when a British diplomat blew the whistle on scams in Bulgaria and Romania, which famously included a one-legged Romanian obtaining a visa as a self-employed roofer.
Georgi said he had arranged work before arriving in the UK, having got a phone number through a friend, although he was supposed to be self-employed. “Because of my problems with a visa, Advance paid me very low wages, £200 for 72 hours,” he said. That amounts to £2.77 an hour when the minimum wage at the time was £4.50. Georgi said he had been working these long hours each week for over four months on the salad production lines: “The worst is I am never sure that I’m going to get paid. It happens to a lot of people.” He also said he paid no tax or insurance but had £48 weekly rent deducted from his wages for a bed in a maisonette he shared with six other men. He said he was afraid to talk about his circumstances. He had handed over the equivalent of nearly £1,000 to a Bulgarian agency in Sofia to fix his visa.
This scandal of forced and super-exploited labour has played a significant part in maintaining the profits of British companies, especially in the service sector, over the last ten years or so. Alongside the general squeezing of the workforce in industry and the services, we can see that this boom has been paid for by the sweat and stress of the working class and not by the productive investment of the profits the capitalists make from our labour.
Without an expanding market for their goods at home or abroad – or at least without the ability to compete in those markets where they do exist due to years of underinvestment in new machinery and research – the capitalists do not invest in increasing production. Instead they squander the profits we make on speculation, acquisitions and mergers. Through privatisation in all its different forms they have found a way to make money without the bothersome business of investing, employing and producing, by buying up already existing production and services and asset stripping while squeezing the workforce dry.
Thus even when there was some recovery in the US market, British capital was in no position to benefit from it. The Bank of England’s Monetary Policy Committee reports that although “the world economy was likely to grow more rapidly in 2004 than for thirty years, UK export growth continued to be relatively weak... exporters were apparently continuing to lose market share, more rapidly than expected.” This they correctly identified was partly due to the overvaluation of the pound. However, the long term failure of British capital to invest in new equipment and training remains fundamental, as we have explained previously.
In the third quarter of 2004 government figures showed that the economy had expanded by just 0.4 percent – half the rate of the previous two quarters – due to a sharp fall in industrial production by 1.1 percent, diluted by a 0.8 percent rise in the service sector. On an annual basis this equates to growth of 1.6 percent, a significant slowdown. A combination of producer price inflation, rising oil prices, but no retail inflation serves to squeeze profitability, and if the capitalists cannot increase their profits they will not invest more or produce more, but will try to squeeze more and more out of their workforce. Instead of increasing output they increase the rate of exploitation of the working class.
Investment has been cut by 40% in the last five years, and industrial production is now once again officially in recession. Britain’s GDP figures are kept artificially high by the growth of the service sector, to the extent, as we pointed out last year, that the measure of GDP has even been changed to give more weight to the service sector of the economy.
We have explained many times that the economy cannot survive on services alone, they are parasitic on the production of real wealth. Manufacturing now accounts for just 20 percent of economic activity, once more confirming Britain’s increasingly rentier state. There are less than 3.5 million now employed in manufacturing, yet this sector is still vital accounting for two-thirds of all exports.
Last year we exposed the myth of a new recovery in investment and this has now been confirmed. The series of interest rate rises introduced by the Bank of England – in a vain attempt to control the unprecedented growth of credit and debt in a ‘soft landing’ – has choked investment in industry.
While the decline of British industry has continued apace, with 750,000 manufacturing jobs destroyed since Blair and co came to office, Britain does lead the world in one sector – credit. At over one trillion pounds British indebtedness now outstrips GDP.
The Bank of England’s decision to increase interest rates was meant to bring this binge to an end, slowly, calmly and with no need to panic. Similarly it was intended to cool the overheated property market, gently, without causing a crash in house prices. Instead it has resulted in a further fall in investment and production, but an increase in credit as people paid their higher bills – mortgages, fuel bills (gas alone has gone up by 19% in the past year) – with their credit cards.
Increased mortgages have meant an increase in monthly housing costs of more than £100 for the average family. This must have an effect on consumer spending, and we have already seen the first evidence of this.
The housing bubble may even now be bursting. House prices rose on average by 18.5 percent last year, but by the end of the year were actually falling in many areas. According to Halifax, the UK’s largest mortgage lender, house prices fell by 1.1 percent in October 2004, taking nearly £2,000 off the average price of a house, the steepest rate of decline since October 2000. The average house price nationally stood at £152,159 at the end of October 2004 as opposed to £154,299 at the beginning of July.
On a quarterly basis prices fell by 0.4 percent between July and October. Five interest rate rises over the past year have raised mortgage payments as a percentage of earnings from 14 percent to 19 percent for new borrowers.
First time buyers can no longer afford to climb onto the property ladder. Young workers and their families don’t earn enough to buy so those wanting to sell to them can’t sell, they in turn can’t move up the ladder and so on. This downward spiral was hidden for a time by those buying houses to rent them out. Now the buy-to-let option is made ever more costly by rising interest rates. As a result, those who bought to rent out are trying to sell too, and there are more trying to sell than to buy. So prices stop rising and begin to fall. These are the conditions for a crash in house prices maybe even of 20 percent.
In the usual expert tone of understatement Martin Weale of the National Institute of Economic and Social Research stated “Looking at the history of the housing market, we have to say there is a significant risk of house prices returning to more normal levels fairly quickly.” More frankly he added, “I would not bet my money on there not being a 20% to 30% fall in house prices.”
He is not alone in this belief. Steve Nickell of the Bank of England, reacting to the figures released by the Halifax explained that there was the risk of a “much bigger correction”. Based on the long-term relationship between house prices and average earnings, of about 3.5 times, he said, house prices would have to fall by around 30 percent to re-establish the average of the last twenty years. Nickell however believes a crash can be avoided, however his reasoning will convince none of us. Wages, he argues, will grow more rapidly than house prices for the next few years, thus re-establishing the norm without a steep fall in property values!
Already, before any steep fall in house prices, there has been a dramatic increase in repossessions. In the third quarter of last year repossessions were at a three year high. The courts made 11,186 repossession orders the highest since the same period in 2001 and an annual increase of 8 percent. The same figures reveal that mortgage lenders had commenced repossession proceedings in 18,513 cases the highest figure since December 2000 and an annual increase of 15 percent.
As we have pointed out before there are two sides to the housing crisis in Britain. Young workers cannot afford to buy and are increasingly forced into the private rented sector as council housing stock has continued to decline. There are now just 2.8 million council houses left in Britain. Despite Prescott’s much trumpeted plans to build houses for young workers and their families, these will be privately owned. If Blair and co get their way there will be no council housing at all, even though the party conference voted overwhelmingly for more investment in local authority housing. The private sector cannot begin to tackle the housing shortage, after all it is in the business of making money not building houses on the basis of need. Not Labour Party conference but big business and the city of London determine Blair’s housing policy.
In a new pamphlet for the Fabian Society, a certain Jeff Zitron argues that tenants should no longer have a vote to keep their council landlords. Mr Zitron, who runs a housing consultancy that specialises in housing transfers and incidentally donated £10,000 to the Labour Party in 2002, proposes that the transfer of the remaining 2.8m council homes should be made mandatory by the end of 2007.
Blair and Prescott have pledged that all social housing should be improved to a decent standard by 2010. But they insist that the extra resources to achieve this will only be available to councils that switch their homes to housing associations, or private finance initiative consortia.
This is in direct contradiction with policy passed by Labour’s conference. Mr Zitron’s pamphlet, Transfer of Affections, said: “The division between the Labour government and the Labour party over stock transfer is undermining the interests of tenants and preventing many of our worst estates from being improved.” Undermining his ability to make money more like, nonetheless his statement highlights the growing opposition to Blair’s privatisation plans inside the Labour Party.
The lack of affordable housing is an important issue alongside health and education, and Blair and co have only one answer, PFI. This is a licence to print money for private consortia but cannot begin to solve these important problems. Meanwhile the property market teeters like an implausibly high house of cards which must tumble sooner or later.
Interest rate rises have resulted in falling investment and production, in turn strengthening of the pound, leading to further falls in investment and production. They have also meant increased credit to pay for the increasing cost of credit!
All of this is reaching its limits. Before Christmas sales were falling in the shops. In the last week of October department store John Lewis reported a three percent fall in sales. Marks and Spencer meanwhile reported that its womens’ wear sales had fallen by 18 percent on a year earlier. The Society of Motor Manufacturers and Traders published figures showing car sales down 13 percent in October, the worst October figures since they began collecting data in 1992.
Right up to Christmas shops reported sluggish activity, so much so that in December, the retail sector’s high point, there were sales in major high street shops before Christmas. Finally they gained some relief with heavy spending in the last two weeks of December. However, this in turn will have been paid for with credit cards and, therefore, will only serve to postpone and exacerbate the problem.
Right on cue, the banks have published figures showing that spending on credit cards in December 2004 totalled £584.6 million, up 12.6 percent on last year. For the first time spending in the shops on credit overtook cash and cheque transactions.
The economy is grinding to a halt, industrial production is falling and the credit that has been fuelling consumer spending and the service sector to mask it is reaching its limit.
Far from abolishing the boom-slump cycle, Brown will not even succeed in meeting his so-called ‘golden rule’ of balancing the budget in terms of current expenditure over the economic cycle. Growth in the economy is likely to be below the 3-3.5 percent needed for that. The trade deficit in the third quarter of 2004 was £15.2 billion, that means it is now running at £60 billion a year, or £1000 for every man, woman and child in the country. Whatever shade the new government may be they will have to increase taxes, increase borrowing or cut spending. Most likely it will be a combination of all three and the working class will once again be asked to foot the bill.
This will have an impact not only on spending, not only on statistics, but on real lives, on the outlook of classes, on class consciousness and on the class struggle.
Leon Trotsky explained something quite profound when he wrote that it is not simply the experience of a boom or a slump that determines outlook. The idea that slump means revolution and boom equates to social peace is patently absurd. Often in a boom, if order books are full workers can fight offensive battles for higher wages. A sharp decline in the economy leading to high level of unemployment can curtail the workers’ movement. It all depends on the context of the conditions, what period has been passed through. A slump following a boom based on increased stress and sweat and job insecurity can have a different effect to a slump following a boom in which the conditions of workers have improved significantly. More important is the change from one condition to the other. The mounting insecurity and uncertainty that disturbs routine has an unsettling impact and can have the effect of shaking a sleeping man. This fact makes it even more important not to hang on the prospect of a slump. From any point of view this is foolish. The exact tempo of the economic cycle cannot be forecast. In any case a serious slump in the economy is not the best situation for anyone. From our point of view a period like this in which despite statistical growth in the economy, jobs are in danger, conditions are under attack, raises questions in the minds of workers.
In the housing market at the end of October just 40 percent of people believed that prices would be higher in a year’s time, compared to 64 percent three months earlier. According to a Mori poll 38 percent of people now think the economy will get worse as opposed to just 12 percent who think it will improve.
One statistic more than any other sums up for us why spending, credit and the property bubble cannot continue, the steep decline of disposable income. Price comparison website uSwitch.com says spendable household income – after bills are paid – will fall in 2005 for the first time since 1998. The impact of higher taxes together with increased gas, electricity, water and sewerage charges mean that of every extra £1 of pay only 28p will be available for spending on items of choice. This compares with 38p per extra pound last year and 50p back in 2002.
This will have a profound impact on the economy so heavily reliant on consumer spending. It will have an important effect on the outlook of workers too. Yet it would be a serious mistake to think that consciousness is determined solely by such economic factors. As Marx explained social being (and not just wages) determines consciousness. Many other factors – political questions like the war in Iraq – and social questions like health, crime, education and so on have a big impact too. Working hours and conditions have just as much of an effect as wages. The economy is entering its 14th year of growth, and this has been achieved not through investment in new machinery, but above all through an increase in absolute and relative surplus value, that is through longer working hours and a massive increase in stress and strain at work. This applies to all sections of workers. In the past we have explained the role of speed-ups on the production line and the general introduction of new management techniques, including teamworking in the Post Office. No sector of the workforce is immune to this epidemic of stress.
According to a survey published by the Schools Advisory Service one third of all teachers working in schools in England and Wales took sick leave last year as a result of job-related stress. It claimed that more than 213,000 days were lost to stress, anxiety or depression suffered by the teaching profession at an annual cost to schools of over £19m. Teachers were off, on average, for 11.5 days in 2003 – more than two full working weeks. The main three reasons given were stress, broken bones and sciatica (pains in the back, hip and outer leg). It also pointed to government’s figures which showed that teacher absenteeism had grown by 11% over the last five years. The total number of days taken as a result of sickness was 639,077 last year, according to SAS.
More people than ever are in work in Britain, and this has an effect on outlook. However that effect is not one of widespread security and prosperity. According to official statistics employment increased by 55,000 over the quarter to October 2004 to 28.44m – the highest total since records began more than 30 years ago.
Unemployment fell by 29,000 to 1.39m, while the number of people claiming benefit was cut by 3,400 last month to 833,200 – the lowest for almost 30 years. These facts have an effect on the outlook of workers, but so too does the nature of many of these jobs – insecure and stressful. High employment suggests a strong economy, but the reality is that the strength of that economy is based on the sweat and strain of long hours and low pay.
At the same time the number of people not looking for work – the so-called economically inactive – increased by 5,000 to 7.9m, while jobs continued to be lost in manufacturing firms. The number of inactive men rose by 23,000 to a record high of 3.15m, while the total for women fell by 18,000 to 4.76m.
That total covers people who have been made redundant, students, individuals on incapacity benefit and those looking after sick or elderly relatives.
The work minister, Jane Kennedy claimed, “The improvement in the labour market is providing more opportunities for people to move from welfare to work. The last year has seen the number of people claiming unemployment benefits fall to its lowest level for nearly thirty years. There are also fewer claiming incapacity benefits and fewer lone parents on benefit.”
We can presume that most of those previously on incapacity benefit have not subsequently been cured, nor have the lone parents won the lottery and employed nannies. In reality they have been forced back into work, many in low paid jobs in the service sector.
The number of manufacturing jobs in the country fell by 112,000 to 3.26m in the three months to October, compared with a year earlier, the statistics also showed. The biggest cuts were in textiles, leather and clothing firms, and the number of people working in the industry is now the lowest since records began in 1978.
Across the economy, the number of job vacancies fell for the second month in a row – down by 2,000 to 644,300 in November. Jobs in the service sector are beginning to dry up and as consumer spending falls there will be job losses here too.
The UK has one of the lowest unemployment rates in the industrialised world, with only Ireland and Luxembourg having lower. However this headline masks the reality beneath of millions working under immense stress; many forced off benefits into work; and record numbers abandoned as unemployable. All these factors, and not just low official unemployment statistics, have an effect on society and the outlook of the working class.
In these economic, social and political developments we find the maturing conditions for social explosions. In the first place further strikes, more activity in the unions, in fact the continuation of the process we have explained over the last two years, which is the mirror image of the process that led to the triumph of social partnership in the unions and Blair in the Labour Party.
In March we celebrate 20 years since the end of the miners’ strike. This most heroic post-war struggle deserves to be celebrated, but also to be studied and understood. The courage and determination of this struggle remains an inspiration. Yet ultimately it was a defeat, and a major setback that led to demoralisation, inactivity, and desperation in the movement. Its effects were long lasting. In the unions social partnership triumphed not because workers believed in it, but because they did not believe that a struggle could succeed. In turn Blair and co were able to rise to the top of Labour illustrating a sense of desperation to get rid of the Tories. This must be recognised.
However, the crust built up over the intervening two decades is cracking. The working class has the patience of Job it seems, but it does not last forever. The hopes of millions in the Labour government have been dashed and patience has largely run out. In the new international, political and economic environment facing the next government there will be a new chapter of militancy, of politicisation and radicalisation.
Our orientation to the trade unions flows from this fact. The correctness of our approach to the new generation of trade union leaders means that we understood the importance of these developments but did not have illusions, nor did we sow illusions, in these leaders.
Neither the shrill denunciations of the sects which prevent them from connecting with leftward moving workers, nor the cheerleading role of the Morning Star, aligning themselves entirely with each new left general secretary, but instead supporting every step forward, while criticising each failure to act and above all calling on them to put their words into practice has allowed us to make some important contacts amongst a new layer of workers.
The new generation of left leaders in the unions have already come into conflict with Blair and co, at least on the floor of conferences. We have to continue to demand that they turn these words of opposition into action.
The power wielded, or potentially wielded, by the trade unions in the Labour Party was demonstrated in a round about way by the so-called Warwick agreement. Whilst there was no reference to the rank and file by the union leadership for the set of extremely minor reforms agreed with Labour leaders at Warwick, nonetheless the fact that the Labour leaders were forced to meet and come to some kind of agreement with the union leaders is an illustration of what the union leaders could do if they raised their little fingers. This was demonstrated again at Labour’s annual conference. As we have pointed out before – and yet all the sects remain blind to the fact – just four main unions control 40 percent of the vote at the conference. Consequently they can dominate the agenda, and to some extent did so in 2004. A resolution demanding the renationalisation of the railways moved by TSSA was passed as a result, ironically in the absence of the RMT.
We explained previously that frustration with Blair and co might lead to one or two of the smaller unions disaffiliating. This was the case with the FBU for example reflecting the anger of the firefighters following the experience of their struggle with the government. However in the case of the RMT, had disaffiliation been put to a vote amongst the membership it seems clear it would have failed. Instead the decision to back the SSP by some branches in Scotland, meant the union had broken the party’s rules and so they were bureaucratically removed, effectively expelled without disaffiliating.
Woodley, Simpson and the other new leaders of the big unions will be quiet in the run up to a new election, but afterwards will be pushed into still further open opposition. Initially demand for disaffiliation may grow again but this will dissipate as union leaders are forced into further opposition inside the Labour Party. In those new struggles the RMT can easily bring its weight back into the Labour Party, as can the FBU.
At this stage the main union leaders seem determined to replace Blair with Brown, even UNISON’s Dave Prentice has called on Blair to hand over to the Chancellor. This is because they believe Brown has the best chance of winning a contest. What they still fail to see is that the candidate with the best chance of winning is whoever they choose to support given the weight of the union vote inside the party.
The opposition of the trade unions is intimately connected with the growth of a new left in the Labour Party. As we have always explained workers and youth will not suddenly wake up one day and join Labour in their thousands and transform it overnight. They certainly are not to be found there at present. Instead it is events in society which will encourage divisions at the top of the party, and the pressure of workers from below that will push the union leaders into conflict with the Labour leaders. The dialectical interaction of these developments, with cause becoming effect and effect becoming cause, will lead to the growth of a new left wing inside the Labour Party at a certain stage.
Will the Labour Representation Committee (LRC) be this new left force? No doubt it will be made up of all sorts. With the exception of one or two individuals like John McDonnell, and the now retired Tony Benn, the left has been virtually invisible in the Labour Party since the late 1980s. Which individuals will move to the left, or back to the left, in the next period is impossible to predict, but it will be events that will push them in that direction and not personalities.
At present the LRC has 400 paid up members and a programme similar to the old Alternative Economic Strategy. Given the opposition to Blair in the rank and file of Labour and the unions this is quite poor. We should participate, take part in a joint struggle against the right wing, but also raise our ideas as an alternative to the blend of reformism on offer.
In reality it will be events and the interaction between those events and the workers’ organisations which will not only remove Blair, and sweep away Blairism, but also create a new left force inside the labour movement.
This process will create many new opportunities for Marxism in the years ahead – we must prepare for that period now theoretically and by building amongst the youth and the unions, not by sitting in empty ward meetings. As Ted always says we are there not for what is there now but for what will be there in the future. Meanwhile, we have to prepare and build, the key to our future interventions in Labour will be the extent to which we build in the unions and above all the youth today.
We have described the strikes and changes of the last two years as the beginning of the catching up of consciousness with reality. This is still at an early stage, but it can accelerate more quickly than we might think in the next period. Again we must not be seduced by the surface of society, nor by the current tempo of events, which has an explanation and can change rapidly. Statistics are only one form of evidence. The last two perspectives explained the role of statistics in some detail. Facts and figures can hardly be ignored but they must be understood in context and anecdotal examples from the workplace are just as important and demonstrate the potential for explosions.
Is this not what we said before? Yes, these conditions continue to accumulate and mature. So where are these events then? We did not say and will not state now, that these events will happen tomorrow or next week. The process at work in British society will not proceed in a straight line and at an even tempo, left march until the revolutionary victory of the proletariat. There will be ebbs and flows. At this early stage ebbs can sometimes appear to be full stops. The role of leadership is vital here too. Strikes continue to be repudiated even by some of the supposedly new left leaders. Struggles like those of the firefighters and local government workers have been settled by the leadership when more could certainly have been won had the leadership shown the same determination as the rank and file.
We have to keep our finger on the pulse of the workplaces as well as the statistics. The example of the Honda plant in Swindon is highly instructive here. This plant, employing around 2000 workers, was non-union until three years ago. Then the workforce was signed up to the AEEU under a sweetheart deal engineered by Sir Ken Jackson and co. The Jackson regime sold the Honda management a compliant workforce. The Honda workers, however, had other ideas. Faced with a compliant union leadership the management introduced a form of compulsory overtime. Working on one hour at the end of a shift in ‘emergencies’ rapidly became the regular working of two or three hours, workers staying on till 1 or 2am when they were supposed to have finished at 11pm. The union’s local full time official refused to call a meeting of the workforce despite their demands over several months. Then a worker we are in contact with in the plant called a meeting and informed the official. 70 workers turned up on a Sunday. There was an electric mood. The official attended and initially denigrated the meeting as ‘unofficial’ etc. The workforce was determined to fight against management’s attacks no matter what the union official said. In the end they won an impressive victory. They went through the official procedures, and union membership grew as a result of taking on management and the preparation of a ballot. The management caved in and removed the compulsory overtime. This tells us more about the mood developing in workplaces around the country than pages of statistics which do not take into account the role of the leadership in derailing struggles or other factors. The leadership of Amicus, for example, has repudiated 20 strikes in the last twelve months. Statistics are important but they must be understood in context.
All we have described so far are tremors, portents of explosions to come.
The struggle of the Firefighters was an important turning point not just because of their militancy, unfortunately not matched by the determination and tactics required of the leadership of such a struggle, but also because of the phenomenal level of public support they enjoyed. This represented something more profound than admiration for a dangerous job, it illustrated that millions of workers are equally disillusioned, feel the same way, and given half a lead by their own unions would fight back too.
The Unison Local government strike was also a decisive turning point. It was the first such nationwide struggle for perhaps a decade. The leadership of that struggle immediately buckled under the pressure of Blair and co. Yet nothing was settled by that dispute, and now public sector workers faced with job cuts and attacks on their pensions are preparing new battles.
“Agenda for Change” – the policy which claims to eradicate poverty pay in the public sector – represents a desperate bid by the leadership to accommodate Blair and co, not an attempt to defeat low wages. From the beginning the Affiliated Political Fund organisation in UNISON has been a transmission belt for the policies of the Labour leaders into the union rather than the other way around. Local government workers, health workers, the public sector employees represented by UNISON have borne the brunt of PFI and other Blairite privatisation schemes. Sooner or later the power of their 1.4 million members, and their power inside the Labour Party will have a dramatic impact on a shift to the left in the labour movement.
A single left candidate in the UNISON general secretary election would stand a good chance of defeating Prentice, if they stood on a programme of fighting Blair in the workplace with militant action to defend jobs and services, combined with a struggle against Blair inside the Labour Party.
Threats of a new massive closure programme in the Post Office, despite Royal Mail making a sizeable profit, promises a new round of struggle by postal workers who have been at the forefront of industrial action in recent years.
Civil servants have also been to the fore in the recent period. The shift to the left at the top of PCS is a genuine reflection of the changing mood below. The current plans, announced by Brown, to axe 100,000 civil servants jobs, combined with an assault on their pensions, is pushing the civil service in the direction of further militant action. Given the generalised nature of the attack on pensions, a mood is developing amongst a wide layer of workers for a fight on this issue. A call by the TUC for a one day general strike before the forthcoming election would gain an enormous echo, and mark another major step in the process unfolding in the unions. However, the TUC leaders would only call such action under enormous pressure from below.
Despite the decimation of British manufacturing, unions like Amicus, the T&G, and GMB remain immensely powerful. Not a wheel turns nor a light burns without these workers, no matter how many Starbucks fill our high streets, or how much income the tourist industry generates, this bald fact cannot be escaped. The shift to the left at the tops of these unions in recent years, under pressure from below, did not end with the election of this or that General Secretary. This process has a long way to go yet. The prospect of a merger between Amicus and the T&G – although the bureaucracies in the unions believe this to be an easier way to secure the unions’ finances than building the membership – will nonetheless, if it goes ahead, create an immensely powerful weapon for the industrial working class.
The growth of militancy in the workplace, the subsequent shift to the left inside trade union organisations and the interaction of those developments is still at an early stage after years of right wing domination and class collaboration. Nonetheless in this unfolding process lies the key to future changes in the Labour Party and one of the keys to the development of the British revolution.
We maintain that all the conditions are being prepared for the development of major struggles even a general strike in Britain. When we first raised this perspective it was met with some derision around the movement. Yet now even the TUC is forced to talk in these terms when preparing their day of action against the attack on pensions. Of course, the leaders of the TUC will avoid this development at all costs, but in the end they will not be able to stand in the way of generalised movements of the British working class.
International events, all kinds of unexpected developments, a failing economy, a crumbling infrastructure, increased militancy will all combine to have an impact on the outlook of all classes in society.
Much of our previous perspective has been borne out. Other elements are now developing. Still other perspectives that dimmed as events were delayed can once again loom large. In an election year it seems appropriate once again to mention the prospect of some form of National government, or government of national unity in the future. This would be a government of crisis. As such it is never simply a question of parliamentary arithmetic which results in some form of coalition, but a profound crisis in which the ruling class cannot rely on a simple majority in the House of Commons for its policy. After all this partly explains their attacks on the limited democracy of the parliamentary system. Still rather than abandon that system and the cover it provides for the untrammelled rule of the monopolies and the ruling class, they would, in the first place, probably attempt to use some form of national government to maintain at least the illusion of democracy for implementing the policy they require. In a very limited sense we saw a glimpse of this in the joint Labour-Tory vote on foundation hospitals and student fees.
The most important feature of the next period in Britain will be a growing class polarisation in society. That means developments to the right and the left. There will be a growth of reaction, of various right wing groups which cannot be ignored. The Tory Party will move further to the right. However the fundamental feature will not be this but the movement of the working class, and the shift to the left in the workers’ organisations, in the trade unions and, at a certain stage, the Labour Party too.
This is the fundamental conclusion of our perspective: all the features we have described will have the effect of increasing class consciousness on the part of the working class, the process Marx called transforming itself from a class in itself, to a class for itself.
For a whole period the waters have been muddied, and the class division of British society glossed over. The growth in the economy, with all its contradictions, combined with the lasting effects of important defeats, has served to mask the differences between the classes and the need to struggle. However that period has decisively ended. It may take some time for consciousness to catch up with reality, the process will take place at different tempos and not in a straight line, experiencing rapid advances, steps backward, and periods of stagnation.
At a certain stage the growth of new left reformist or even centrist currents will be an inevitable part of this process, too. In the future, on the basis of major events, the left will come to dominate the Labour Party once more. That seems hard to imagine at this point in time, when the party as a whole is largely dormant, and the left almost invisible. However, a dialectical interaction between events and the mass organisations of the workers, beginning with the unions, and then in turn between events, the unions and the Labour Party will transform all of these organisations again and again in the years ahead.
The method of Marxism allows us to see clearly the outlines of future developments which will lead to splits, divisions and the growth of a mass left force inside the workers organisations. From these developments the future mass forces of revolutionary Marxism will emerge, provided we have built a serious tendency of cadres in the meantime. It is precisely because we understand the importance of the mass organisations and their future course of development that we must now devote such attention to work in the unions and to independent work amongst the youth.
When these events will occur is not a question we can seriously address. Instead we concentrate our attention on each stage through which we pass in order to prepare ourselves to intervene in the movement of the working class and its organisations, and above all amongst the youth. Not when or if, but will we be ready, will we build and prepare the forces needed, these are the questions the answers to which are in our control.
The fundamental question facing our tendency is not when events will shake British society to its foundations – a question we cannot answer with anything approaching certainty. Nor is it whether there will be such events or not – our unshakeable confidence in the struggle of the working class and the socialist future of humanity is at the root of our indefatigable revolutionary optimism. This faith is not of the religious or mystical kind but instead is based on the sound science of Marxist ideas. The question that only we can answer is: will we be ready for those inevitable events?
In 1925 Trotsky posed the same question, quoted at the beginning of this document. All thinking workers and youth should make a serious study of Trotsky’s writings on Britain which retain all their validity and remain a powerful weapon for us today. That is not to say that Trotsky’s writings are a recipe book in which we can find ready made answers to the problems in front of us. Rather it is the method employed by Trotsky, the method of Marxism, which we must strive to understand and apply to the unfolding events around us.
Tragically, in 1926 the answer to Trotsky’s question turned out to be “no”. Our task is to ensure that we can answer “yes”, and our starting point is to arm ourselves with an answer to the question where is Britain going?
To the superficial observer the answer would probably be “nowhere far, and nowhere fast”, but as Marxists we must not allow ourselves to be seduced by the surface calm – increasingly now punctured by events like the anti-war demonstrations, the civil service strike, the Wembley dispute, etc. Our task instead is to burrow away under the surface to grasp the process, the shifts and molecular changes, taking place beneath. We must take the pulse of the economy, of politics, of international relations and try to understand their impact on the consciousness of all classes in society. This perspectives document seeks to describe and analyse the accumulation of changes taking place in society which must at a certain stage result in new qualitative leaps, sharp turns and sudden changes in the situation. We must not be caught unawares. We must build in advance of the events we foresee.
How do we prepare forces for events, without events to prepare forces? We concentrate on the ones and twos, recruiting and educating the most advanced workers and youth. Even at an early stage in this process there are new militants to be won in the trade union movement. Our work in this field is generally slow and patient work but even here we can make important gains. However, there can be no doubt – and there is no contradiction with the fact – that it is an energetic turn towards the youth which is the key to building our tendency now.
This period should have been ideal for the sects, yet they are all at sea. They lack a compass. The ideas of Marxism are the means by which we reach workers and youth, win them, educate and train them. We have those ideas. To the degree that we are convinced of the inevitability of events, that we understand the crisis of capitalism, we must lift ourselves up to the task of winning new layers of workers and youth to the struggle, to the programme of International socialist revolution.
Movements of the working class are inevitable. We cannot make predictions about the timescale involved. We cannot even commit ourselves to the five years referred to by Trotsky in the quote that opens this document, although even that is possible. When Trotsky wrote those lines it was only a matter of months later, in May 1926, that the great General Strike took place. We cannot say when new explosions will take place, but a period of decades does indeed seem highly improbable. All we can know for sure is that these struggles will take place. That is guaranteed. That we capitalise on our opportunities is not. It is in our hands. It is a conscious decision we must make to dedicate ourselves to building our movement.
We must feel on our shoulders a piece of history. This weighs not as a heavy burden but as an inspiration. The international struggle of the working class and the correctness of the ideas of Marxism must inspire us to commit ourselves to the effort and sacrifice required to build our movement.
We have a vision of a new society, a society without war, poverty, hunger or despair, where the remarkable power of science and industry is democratically planned and used in the interests of all. A world of superabundance is possible. That socialist world is no utopia, but a destination we intend to reach.
T.E.Lawrence once wrote “Dreamers of the night will wake to find their dreams but vanity, but the dreamers of the day, these are dangerous men, for they will act upon their dreams and make them reality.”
April 2005
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