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From The Socialist newspaper, 6 December 2007


Labour's funding scandal

 Brown dashed from the TUC to meet the hated Margaret Thatcher

Brown dashed from the TUC to meet the hated Margaret Thatcher

THE PARTY funding scandal engulfing New Labour is only the latest in a long line of similar sleaze scandals. But is it any wonder when the Labour leadership has completely gone over to the side of big business and therefore accepted the need for its support?

Not one newspaper or political commentator ever starts from this premise. For them it is down to the mistakes or "illegal actions" of this or that New Labour figure. The nearest any commentator came to this conclusion was Steve Richards of The Independent who linked it to "Labour's love affair with big business".

Even then he says that in the past "the leadership was too rigidly accountable to the party... to the point of madness". He means by this that the leadership had to report to Labour's national executive committee (NEC) and the annual Labour Party conference that held them to account to a certain extent. Now Richards says it has gone too far the other way. But he never explains that it was the abandonment of any connection to socialism that made this inevitable.

For all these pundits, this link between support for the capitalist system and Labour's dependence on individual capitalists like David Abrahams, the northern property developer behind the latest scandal, is a book sealed with seven seals.

In the past the organic link between the Labour Party and the organised working class was expressed by the direct participation of the trade unions at local, regional and national level.

But the changes to the Labour Party in the last 15 years have cut this umbilical cord by marginalising the unions' role in the Labour Party's internal affairs.

The payment of the political levy, on a weekly or monthly basis, by millions of trade union members when they paid their membership dues to the unions also meant that this was the main source of financing the Labour Party.

Accompanying Labour's ideological shift to outright support for the market system has been a closing down of all means by which the organised working class could, to a certain degree, keep in check the Labour leadership.

The Guardian refers to the Labour Party treasurer, Jack Dromey, who is also the deputy general secretary of the TGWU section of the Unite union, as "serially ignorant". This is a reference to his "I know nothing" response every time a financial sleaze scandal hits New Labour.

His wife, Labour's deputy leader, Harriet Harman, now admits she received money from one of Abrahams' "third party" nominees for her deputy leadership campaign. (Abrahams also gave money directly to Harman's losing rival for the job Hilary Benn.) Clearly, Dromey's 'ignorance' didn't stay in the office but extended to the home as well.

Meanwhile, Gordon Brown has desperately sought to distance himself from the whole mess by saying, in effect, that "it all happened under Blair". In reality, they were both the architects of New Labour's counter-revolution against the working-class base of the party.

Cash for influence

OVER 100 years ago the Labour Party was set up by the unions to represent the interests of the organised working class (that is, "those without property") in parliament and the council chambers. The Tories and Liberals clearly represented the interest of the capitalist class ("those with property").

The only way for Labour to finance itself then was through the unions. And the unions in turn raised that finance directly from the members' weekly or monthly dues, a part of which was paid over to the Labour Party in the form of the political levy.

20th century history is littered with examples where the ruling class gnashed its teeth at this arrangement and did its best to end it. The last time was Thatcher's introduction of the requirement for unions to ballot their members every ten years to maintain their political funds designated for that purpose.

The same capitalist class who all the while kept pouring money into their parties' coffers raged against this "robbery of union funds for political purposes".

The boss class was not so much bothered about the union members' money being taken to finance the Labour Party as much as it feared the potential threat to its rule, if not by a potential left-wing Labour government then by a mass party that would be the arena of debate on socialism or capitalism.

But now this has all changed with the transformation of the Labour Party since the early 1990s. The party has lost most of its working-class base and the unions have been marginalised to the outer edges of its deliberations. For the capitalist class, both as individuals and collectively, the Labour Party is now one of three parties which can be relied on to protect its interests.

The periodic "cash for influence" scandals, as is only too normal, happen when you have political parties which rely on the patronage of big business and wealthy individuals who inevitably seek influence to increase their privileges and incomes. This has been the case for decades in the USA where the lobbying of capitalist parties by corporations and individuals has became an art form running into billions of dollars.

New workers' party

BROWN, IT seems, is now consulting the unions on how to get out of the mess he is in since the latest scandal broke out. He has given up trying to get cross-party support for the proposals of Sir Hayden Philips to put a 50,000 limit on single donations by individuals or organisations to political parties in the lifetime of any one parliament.

The Tories oppose this because it would stop them sending large wads of cash to local Conservative associations in marginal seats as a new election approaches. Brown is saying to the unions that this proposal won't stop them giving large donations as they do now "because the union political funds are raised from the political levy and they are small sums from individual members on a regular basis and will be counted as such and therefore will not contravene the 50,000 limit".

The union leaders will accept this because they see no alternative, but this will not mean they will see their influence increase in the Labour Party. New Labour will continue to depend on big business and so pursue its interests and not those of the working class.

The union leaders' myopic outlook is because they are looking into an abyss and see no alternative to New Labour. But, with or without the union leaders, the need for the unions to end their link with Labour and throw their weight behind a project to build a new mass working-class party has more support amongst ordinary workers than ever before. The events of the past few weeks will only reinforce this once more.

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In The Socialist 6 December 2007:

System change not climate change

Feature: The free market brings fire, flood and famine

For decent public transport!

Workplace news and analysis

DWP strike: Fighting low pay

Socialists and the trade union leaderships

What we think

Labour's funding scandal

How New Labour got hooked



No to academy schools!

Compulsory school to 18 - a rosy future for young people?

Child poverty rises

Rail fares unfair

International socialist news and analysis

Chavez referendum result a big setback

Annapolis - a framework for further conflict

Intelligence on Iran wrong

Disunited Russia

Italy: transport strike

Kosova: After the elections - before the explosion

Northern Ireland classroom assistants

Argos strike in southern Ireland

South African miners strike over safety

Socialist Party review

The socialist review: 'Taking Liberties'

Post Office and CWU

Keep the 'people's Post Office' public

CWU ballot result

Workplace news

Unison's right wing still witch-hunting

Save Cadbury jobs!

Manchester's striking mental health workers: Defending trade union rights


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