Socialist Party documents

British Perspectives: a Socialist Party congress 2012 document


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Enfeebled British capitalism

17. Besieged on all sides, the coalition government is thrashing around in a desperate search to break the logjam.

Osborne went to Beijing, cap in hand, desperately pleading for the Chinese regime to invest its largess - its huge reserves - in Britain's crumbling infrastructure! What an incredible historical turn around! Gunboats were deployed by Osborne's predecessors in the Yangtze River 'incident' during the Chinese revolution, when the British navy was hailed as heroes because they managed to escape! Now, the representative of enfeebled British capitalism calls for help from this quarter.

It is just one manifestation of the astonishing decline of a power which once held the destinies of a quarter of humankind in its hands.

The field of foreign policy illustrates the profound change in the position of British capitalism both at home and abroad.

18. Just 30 years after Thatcher defeated the Argentina junta, which was a close run thing at the time, the Falklands/Malvinas issue in the South Atlantic could possibly come back onto the agenda in the next period.

The defence cuts announced recently by the government have left British imperialism without any aircraft carriers.

This will weaken the military capacity of British imperialism to confront any new offensive posture of the Kirchner regime.

Although war appears unlikely, it cannot be completely discounted. A new factor in the situation is the discovery of oil and other vital raw materials in the region.

It is this, rather than the historical claims of Argentina to the islands, which fuels the current exchange of threats and insults between Argentina and Britain.

We would advocate negotiations between the Falkland Islanders and the Argentinian working class, and a shared approach to the exploitation of the resources in the region which would be for the mutual benefit of the peoples of the area.

19. The prolonged hangover from the recession - inevitable given the financial 'excesses' before 2007 - has been enormously aggravated by the policies of the coalition government.

Even the New York Times has pilloried Osborne for his "quack cure" that could lead to a "lost decade of no growth".

Gross domestic product stands 14% below where it would be if the pre-2007 economic trends had continued.

20. 'Eternal austerity' seems to be the only solution on offer. Adding to the mass discontent is a growing awareness of the massive disparity of wealth between the top and the bottom.

This was one of the factors that led to the crisis in the first place, with diminishing spending power of the working class cutting the market.

However, this has continued during this crisis and at a massive rate! Impervious to criticism, the bankers continue to award themselves stratospheric salaries and bonuses while working people are losing their jobs and homes, and those on benefits are subject to ceaseless attack.

RBS chief Hester awarded himself almost 1 million in bonuses and the Tories were prepared to wave it through until Hester crumbled in the teeth of huge public pressure.

This has not stopped the big companies from evading tax of 25 billion, with the Tories in particular happy to sign off on these scandals.

Meanwhile, 800,000 homes could be put out of the reach of people on housing benefit, which is going to be ruthlessly cut if the government gets its way.

21. Evictions are under way as a policy of 'social cleansing' takes place. Poverty, particularly affecting children, will rise further as a result of government policies.

In a shameful and demagogic fashion, Cameron has sought to split the working class on the issue of cutting benefits.

The cap of 26,000 is intended to give the impression that welfare recipients are living the high life.

The main beneficiaries of such 'handouts' are the growing band of ruthless landlords who are allowed to profit from this situation because of the shamefully low number of houses built in Britain.

There is a simple solution to the 'scandal' of benefits and that is to build cheap, good quality, publicly-owned social housing.

22. Incredibly, the government appears to be getting away with this attack by deliberately setting one section of the population against another.

And New Labour has contributed to this. They did not oppose the government's attack on the very poorest section of society but abstained instead.

There is no more contemptible figure in history than Pontius Pilate! It was left to the bishops and the House of Lords to lead the attack.

Nothing could better illustrate the crying need for the new mass party of the working class!

23. Housing will form a vital arena of struggle of the labour movement and for our party in the next period.

Repossessions putting even more strain on the housing benefit bill and limited social housing stock; high rents in the private sector meaning 'social cleansing' is extending to people in employment not in receipt of housing benefit; former council housing now in the hands of private landlords; the scandal of so-called 'sheds with beds' with thousands of illegal dwellings across London and the Home Counties being 'homes' to the most desperate in conditions more akin to favelas; these are some of the results of capitalism's inability to provide the most basic social amenity of a roof over people's heads.

Mass protests against evictions could develop as are beginning to happen in the United States. Security of tenure and public sector rent controls, alongside a crash house building programme, must be at the centre of such a campaign, alongside the demands for nationalisation of the building industry and a publicly-owned housing finance company.

24. Undoubtedly the growing opposition to inequality - which is a worldwide phenomenon - has been given a focus by the Occupy movement.

The significance of this movement was discussed at the recent IEC. It was noticeable that in countries which have witnessed movements of a mass character - such as the US, Spain, Portugal and Greece - there was a ready acceptance of the symptomatic importance of this movement.

The Occupy movement was wider and deeper - found a greater echo amongst the mass of the population - than the anti-capitalist, anti-globalisation movement at the beginning of this century.

On the other hand, in those countries with a strong trade union movement, the Occupy movement was seen as less important.

25. However, we will make a mistake if we do not recognise that movements of this character can fill the vacuum left empty by the trade union and Labour leaders.

The very fact that they reclaim the public space, the right to demonstrate, etc, is itself worthy of support.

If there is a stifling of the movement at the top, with the trade union leaders evacuating the field of battle - empty words instead of bold action - then movements similar to Occupy could break out again and on a wider scale.

At the moment, it is low-level, both in terms of action and of consciousness. It is a mood, rather than a large movement, of young people and even of workers disgusted at the role of the trade union leaders.

26. The Occupy movement has contributed to the capitalists trying to answer the opposition to growing inequality.

Without it, the Financial Times would not have carried a series of articles on "Capitalism in Crisis".

Nor would Cameron and a growing band of Tory MPs condemn 'crony capitalism'. It was left to the witless George Osborne to suggest that we did not face a crisis of capitalism, but a crisis of the 'West'.

Capitalism is, you see, still powering ahead in Asia. What will be his answer, however, once Asia, particularly China, the powerhouse for economic development in Asia, is affected by the meltdown in Europe? Osborne is somewhat unique because he is in denial about the seriousness of the crisis confronting his system.

However, he did score a bull's eye when he pointed out that the prophet of unrestrained capitalism, Friedrich Hayek, was invoked by the economics group of the London Occupy movement in the Financial Times series. This merely serves to underline the confusion in that movement.

27. But Clegg's synthetic campaign in favour of 'tax breaks' for very low-paid workers earning less than 10,000, together with his 'day of rage' against the high paid does indicate the sensitivity at the top to the widening gap between rich and poor.

The independent High Pay Commission illustrated this when it said that the top 0.1 per cent's share of wealth, which narrowed following the Second World War, is back to 1940 levels and heading towards those seen in Victorian times.

Vince Cable has also thunderously demanded rights for shareholders on the boards of companies. No such rights, however, have been suggested for the workers who actually produce the wealth.

28. Such proposals do not even begin to address the issue of control over capitalism. The holders of shares are disparate, sometimes only holding them for a very short period of time, even seconds, such is the frenzy of modern capitalism! They are therefore unlikely to exercise control over the directors and managers of large firms.

During periods of upswing, of economic growth, disparities, even a growing gulf, can be tolerated by the masses without being completely accepted.

But with the deterioration in day-to-day living standards, this situation becomes totally unacceptable.

29. Various commentators from George Monbiot to Will Hutton, in answer to the growing wage gap, have suggested a limit on top wages.

Some top bosses are being paid a thousand times the national median wage! Monbiot suggests a maximum of 500,000 a year! Will Hutton proposes the bosses should get no more than 20 times the average wage.

Why? What justification is there for anybody in the modern era living on such an inflated income? Yes, even if we had a democratic socialist workers' state we would have to allow a reward for special skills in the first stages of constructing such a state.

But not at the level suggested by our 'radicals' of more than 10 to 1 let alone 20 to 1. The Russian workers when they took power rewarded skilled labour - outside of the Bolshevik party - with up to four times the average rate.

But that was on the basis of a poor, culturally deprived society. Where human solidarity prevails - as it will in a socialist society - skilled labour will probably be rewarded by less than 4 to 1.

30. The significance of the ongoing discussion on the wealth gap is that the capitalists are compelled to reply.

The rich can feel the growing class hostility and, like a burglar with a stolen watch which burns into his flesh, they seek to dissipate the anger, even seeking ways in which to incorporate opponents into the system.

In vain, because opposition to it will grow in the next year as the chasm between the classes widens into Grand Canyon proportions.

Therefore, the measures contemplated by Clegg, Cable and the demagogic Cameron are cosmetic in character.

They will not be able to overcome the sense of powerlessness, the lack of control felt by the great mass of the working class and the youth.


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