Crisis and realignment
BRITAIN'S Conservative government has made a unique contribution to the struggle to reduce unemployment figures. Since 1979, they have changed the method of calculating the number of unemployed 17 times.
Thus, the February 20 announcement that unemployment had reached three million masked the true figure; for some time real unemployment
International Viewpoint #243 March 1993 of the trade union bureaucracy, wants to sever Labour's organizational links with the unions completely and talk openly of the creation of a capitalist party on the lines
In the current relationship of forces such a project is unrealizable. But John has been more than four million - about one sixth of the workforce. PHIL HEARSE — London, February 23, 1993
HE CASCADE of redundancies reflected in this figure is iust one symptom of the utter collapse of the Thatcherite economic project, which in turn underlies the disarray of John Major's government. Since the collapse of the pound sterling five months ago, and Britain's withdrawal from the European exchange rate mechanism (ERM), the Conservatives have drifted from one political crisis to another. At the same time, there has been an upsurge of workers' mobilization against the government; but such opposition is hamstrung by confusion and outright ideological collapse in the opposition Labour Party, itself reeling from its fourth successive electoral defeat.
While international attention is focused on the crisis of the German economy and Clinton's attempts to relaunch economic growth in the United States, the extent of Britain's economic decline is devastating. The core sectors of the 1980s "yuppie boom", financial services and real estate, have collapsed. Industrial investment is around zero. The state budget deficit is around £50 billion. And the pound has fallen from DM2.95 to DM2.35 in a few months.
Totally exploded is the Thatcherite myth that British capitalism could be regenerated by a combination of smashing the unions, market deregulation, and a smaller but fitter industrial sector topped off by a large service sector. The international financial markets don't believe that an economy without a strong industrial base can go anywhere but down.
If this were not enough, the Tory government is in the middle of a prolonged crisis over the Maastricht Treaty on
European union. With a parliamentary majority of just 20, the government is constantly threatened by revolts from its
"anti-European" wing, egged on by an embittered Lady Thatcher and her main lieutenant, arch right-wing ghoul Norman Tebbit.
The current political crisis was sparked off by two bombshells last autumn -withdrawal from the ERM and the public outrage over the decision to close most of Britain's coal mines. The former was pounced on by the rightwing Tory "Eurosceptics" and the latter led to the biggest workers' demonstration for a decade. Here was the raw material for the Labour Party to deal devastating blows to the government.
But it was not to be. In the wake of the Tory election victory last April, an election many thought Labour would win, the new Labour leadership is in a state of ideological collapse. Under Kinnock, since 1983, the Labour Party moved progressively to the right, adapting to Thatcherite ideology and watering down Keynesian interventionist and social welfare policies. Under new leader John Smith, this process is set to take a qualitative leap forward.
"Clinton economics"
Into Labour's ideological void has stepped the electoral victory of Bill Clinton. "Clinton economics" is the rage in the Labour leadership; and in his February 7 speech John Smith set out a new agenda for the Labour Party committed to "individual enterprise and effort". At the very moment when the market economics of the Reagan-Thatcher years are utterly discredited, the Labour leadership can think of nothing better than to deepen its commitment to this failed enterprise.
Coupled with its ideological follies, the Labour leadership is entering into a far- reaching battle over the party's links with the trade unions and their "block vote"
which enables them to dominate party conferences. A faction of the leadership, led by shadow cabinet member Tony Blair and backed by the most rightwing sections
Smith has pinned his colours to the mast of an extensive reform of Labour's links with the unions, seen as a major vote loser. The influence of the left within the party is at its lowest level for 20 years.
However, the Blair project faces major obstacles, behind which stand the overall strength of the organized labour movement. The Labour Party is financed overwhelmingly by the trade unions. Any alternative based on cutting the union link with the aim of creating a "new mass membership" for the party has to confront the reality that the party's membership is in fact declining. In the absence of state funding for political parties, a Labour Party with no union links would face financial collapse.
In any case, John Smith's new political direction and talk of breaking the union link, has provoked Labour's formidable traditionalist sensitivities. A serious attempt to push through the Blair project would mean a new round of internal warfare.
In the 1980s economic problems were disguised by tax revenues from North Sea oil and the sell-off of nationalized industries, as well as the boom in financial services linked to the expansion of the US economy in the years of Reagan's military build-up. These props have gone. Now, massive social security payments to cope with rising unemployment and falling tax income have led to a huge state budget deficit, accompanied by a growing balance of payments deficit.
In the absence of any ideas on how to regenerate the economy, John Major's government has opted for the simple choice: further attacks on the working class and the welfare state, combined with more of the reactionary social engineering pioneered in the Thatcher years.
Last year being an election year, the
Tories contented themselves with a new round of anti-trade union legislation and a viciously racist Asylum Bill. Now they are setting off on a new round of privatizations and attacks on the welfare state. All these are linked together into a further attempt to destroy the public sector, which with the
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BRITAIN
International Viewpoint #243 March 1993 decline of manufacturing industry, is the real stronghold of trade unionism.
British Rail, the Post Office and other services are to be privatized. The marketization of the health service is being deepened, with the closure of several important
London teaching hospitals. Harsh new social security measures, including the introduction of a "workfare" scheme to make the unemployed work for their social security benefits, are being discussed.
### Devastating cuts
Most devastating, however, is the simple lack of government financial support for all public services, especially those provided by local government. For the first time in living memory local authorities are making teachers compulsorily redundant;
and 100,000 local government workers face the sack over the next two or three
These cuts are surrounded by a cluster of lesser measures, such as the virtual abolition of a public dental care system and the reorganization of school teaching curriculums to remove any progressive content, especially in subjects such as English and
Finally, Britain is today at the cutting edge of the imposition of the "new management techniques", popularly known as "Japanization" which imply a reorganization of working practices to the detriment of the labour force, which have now been imposed on millions of workers.
The upsurge of protest in defence of the miners, including demonstrations by hundreds of thousands of workers, has to be seen against this background. Mass unemployment, and the dominance of the "new realist" rightwing leaderships, have combined to thwart a sustained fightback against Tory attacks. Defence of the miners has created a mass movement, but one so far limited to protest actions, without industrial action.
This is the central contradiction in the situation. The disarray of bourgeois political projects is being met by the first stirrings of mass opposition but not as yet by a mass strike movement which could change the balance of class forces.
Even so, the government is retreating on the issue of pit closures. Fierce battles are taking place within the cabinet over what concessions should be made. Unless at least half the pits are kept open the government faces a parliamentary defeat on the issue. The allocation of large subsidies to keep many of the pits open would in itself constitute a victory for the mass movement against closures. Not since the poll tax debacle and the fall of Mrs.That14 cher have the Tories suffered such a rever-
The Maastricht problem is far from solved. Ingeniously, Tory Euro-sceptics have decided to vote for a Labour amendment on the treaty, pledging Britain to accept the "social chapter" which Britain has been formally exempted from. In theory this would make the Treaty impossible to ratify. The government has responded by saying that it has the right to ratify the treaty and ignore the vote in parliament.
However, this would open up a major
The overall picture is one of chronic economic decline, working class retreat and political crisis in the government and the major opposition party. How this political gridlock breaks depends in part on developments in the economy.
The one major success for Major so far has been a fall in the rate of inflation to a twenty-year low of 1.75%. But there is no mystery behind this. Chronic deflation and the collapse of consumer spending have sent prices hurtling down. Any pickup in the economy would send inflation up again as would any decrease in unemployment. When unemployment last fell and the economy revived in 1987-89, inflation shot up to 11% and a rash of wage struggles broke out. Major's current 1.5% public sector wage freeze is premised precisely on high unemployment and chronic deflation. Any minimal upturn in economic activity will break the dam of low inflation and low wage increases.
The state of the left
But breaking the gridlock also depends on political developments on the left, building a viable opposition current inside the labour movement which can propel the movement into more sustained action. In the unions there are the first signs of the building of a "public sector alliance" with a number of unions holding a simultaneous ballot on March 5 for a strike against privatization and service cutbacks. Several different rank-and-file formations, the most important led by the far left Militant Tendency, are attempting to build permanent union alliances on this issue.
At a political level the Labour left faces overwhelming odds inside the party. Only Tony Benn remains as the standard bearer of the left on the National Executive and thousands of leftists have left the party. However, the party's leftwing still remains the largest of any mass workers party in Europe, and is taking the first steps towards regrouping around a network linked to the Socialist Campaign Group of Labour MPs.
The far left is dominated by two large tendencies, the Socialist Workers Party
(SWP) and the Militant. The SWP continues to be able to recruit large numbers of young people through vigorous propaganda work, but its national political impact is negligible compared to its numbers, owing to its lack of any united front strategy aimed at turning the tables on the new realist right throughout the labour movement.
### Prolonged recomposition
The Militant has suffered splits and decline after its recent move out of the
Labour Party. It has "modernized" its political profile especially as regards issues such as women's and Black liberation. But it seems clear that the far left has entered a period of prolonged political recomposi-
Even inside the SWP we have had the first inklings of political debate over its triumphalist organization is currently proclaiming the need for an all-out general strike and engaging in a frenetic recruiting drive on a very
The fate of the far left organizations, organizationally the most powerful in the advanced capitalist countries, depends on whether a workers' fightback can be sustained. In the 1980s the British labour movement suffered ferocious attacks. Its resilience and the maintenance of a considerable part of its organizational strength is linked to the traditions of mass unionism, as opposed to the semi-political unionism of France and Spain, itself a function of the overwhelmingly proletarian composition of the country.
In the 1970s and 80s the bourgeoisie devised a radical new project, Thatcherism, aimed at breaking with the post-war Keynesian welfare state consensus and regenerating the economy. The consensus was indeed broken, but the economy has not been regenerated. Nothing of any substance has arisen to replace Thatcherism; the Conservatives have run out of ideas and Labour has pushed its radical left to
However, such is the extent of Britain's historical decline and drift towards collapse that British capitalism does not retain the kind of resources for the sort of relaunch that can be envisaged for the US, Germany or even France. The enfeebled British bourgeoisie is compelled to seek new historical routes out of the current impasse. Unless the labour movement is capable of forging its own historical alternative the post-Thatcher bourgeois political vision is likely to be even more barbaric than the Iron Lady ever imagined. *
Dossier: EASTERN EUROPE