Link to this page: https://www.socialistparty.org.uk/issue/1115/31784
2020 - a year which drove home the catastrophic failures of capitalism
Join the fight for a socialist world
Hannah Sell, Socialist Party general secretary
A Tower Hamlets council worker on strike against contract downgrading in July 2020, photo Hugo Pierre (Click to enlarge)
The world was united in misery in 2020. Too many deaths from the pandemic, job losses, pay cuts and poverty were the experience in virtually every country on the planet. Britain, as the year ends, is leading the world in a new surge in the virus; with the highest ever level of recorded infections.
The misery, of course, is not universal. Sections of the capitalists are doing very nicely indeed. Ten of the richest people in the world have increased their wealth by more than £300 billion since the pandemic began. Across Britain's 100 biggest stock market listed companies, CEOs collect an obscene 73 times the average wage of their workers.
But while the fortunes of the bosses of logistics, PPE, pharmaceutical and some other companies soared, capitalism as a whole entered a devastating crisis, the price for which is being paid for by the working class and poor.
Chancellor Sunak's autumn statement confirmed that Britain's economy is expected to have contracted by over 11% in 2020, the worst situation in three centuries. Sunak's family will not be facing impoverishment as a result; he is married to one of the richest women in Britain.
It is a different story for the majority however. By the middle of the year 5.6 million people were claiming Universal Credit, with more than 60% of them having little or insufficient work. That is an increase of three million from October 2019.
It is estimated that the pandemic has left two million families destitute - struggling to feed, house or clothe themselves. Meanwhile there are still more than two million people furloughed, often having to live on 80% of their normal wage, and fearing they will have no job to return to.
The latest surge in the virus and Johnson's belated and botched new lockdown measures have only worsened an already dire situation, forcing Sunak to extend the furlough until the end of April 2021. This will mean that the government has paid 80% of millions of workers' wages for a year.
The Tories, like all governments with the resources to do so, have spent unprecedented sums in an attempt to limit the damage to capitalism done by the pandemic. UK government debt is now at its highest ever level outside of wartime. In the short term this has lessened the effect of the crisis, although it is still devastating.
It is already clear, however, that longer term the capitalist class intends to use the scale of the state debt to justify new attacks on the working class and some sections of the middle class. Sunak's announcement of a new public sector pay freeze - when public sector workers' wages have been squeezed for a decade (a civil servant's wage has shrunk by 19% in real terms in that time, for example) - is a down payment on their future intentions.
2020 turning point
The year 2020 marks a turning point in history and the start of a new era of intensified capitalist crisis. That does not mean there will be no economic recovery from the current devastation. In the short term the rapid spread of the new strain of the virus is leading to a new severe contraction in the economy. However, if the vaccines that are starting to be rolled out prove effective, the lessening of the pandemic's grip will be in sight as 2021 dawns.
That will also create a certain economic rebound. In addition, the fear of a 'no deal' Brexit having been lifted, despite the very limited character of the deal, will have some effect in lightening the deep black cloud of pessimism that currently dominates the mood of the majority of Britain's capitalist class.
It is ruled out, however, that any recovery will wipe out all of the devastating plummeting of the economy in 2020, either in Britain or internationally.
The events of the last year, and those still to come, are having a profound impact on the outlook of the working class. Johnson's general election victory a year ago, and the mood of 'national unity' that existed at the start of the pandemic, now seem to have happened in a different lifetime. No capitalist government has dealt well with the pandemic, but Johnson's crew are at the bottom of the pile, at least of the economically developed countries.
Those measures that have been taken have been done incompetently, often by companies whose only qualification were connections to Tory politicians. Cronyism is rife. One survey found that half of all the money handed out by the government for Covid-related measures went to companies who had links to Tory politicians and/or no previous experience in the field!
Extreme short-termism has dominated decision making from the initial attempt to do nothing and rely on herd immunity onwards. It has resulted in countless edicts that have worsened the pandemic, followed by endless u-turns. From 'eat out to help out' in the summer, to insisting that schools remain open - even using Covid emergency powers to threaten Greenwich Labour council for planning to end term a few days early because of surging virus rates.
Less than 24 hours later the government was forced to recognise schools' part in spreading the virus, not least the new strain. It hastily announced a non-existent plan to test pupils, adding to the already astronomical pressure on teachers, and has now u-turned again, delaying the start of the new term for many school students. Laughably, Johnson has still claimed that schools that remain open are safe.
Trade unions representing teachers and other school staff have correctly raised that they should not have to work if it isn't safe to do so (see 'Workers' action wins Tory U-turn on school safety'). At the time of writing, thousands of schools are not open as a result. The whole trade union movement needs to stand in solidarity with this important struggle to protect workers' and school students' health.
The schools fiasco and the last minute curtailment of Christmas are only the latest of countless blows to the population that Johnson has presided over in his year in office.
Unsurprisingly, the Tory government's opinion poll ratings have been on the slide for months, and the dominant moods in society are of deep-seated fury, frustration and fear.
Anger not yet expressed
That mood has not yet, in the main, been expressed through action. Shock and the struggle to deal with immediate personal health and economic stresses have been dominant. It could not be otherwise given the almost complete absence of a lead from the top of the workers' movement in a struggle to defend the health, jobs and conditions of the working class.
When predominantly young people took to the streets for the Black Lives Matter protests during the summer, many trade unionists took part, as did the Socialist Party, but the majority of the leadership of the organised trade union movement was woefully absent.
Meanwhile Starmer's New Labour leadership has acted at every stage to defend the interests of the capitalist class. Even this week, when calling for a new national lockdown, he still declined to support school unions’ call for school closures!
Nonetheless, despite the blockage at the top, it is inevitable that 2021 will see new mass expressions of class anger, possibly dwarfing anything seen in recent years. Movements on the scale of those that have shaken Chile, the Lebanon, Nigeria and other countries can also come to Britain.
There are countless issues around which struggles could develop, including the continued battle for health and safety in the workplace, the fight to save jobs and against mass unemployment, to stop evictions and homelessness, among students who are paying £9,000 fees for very little education, public sector workers opposing the pay freeze, and many more. An important aspect of all such struggles will be attempts to transform the trade unions into fighting, democratic bodies capable of effectively defending the interests of their members and the wider working class in a coordinated war against Covid austerity.
Sickness of British capitalism
While it is not possible to predict the exact timing of such developments, the factors creating them are clear and deep-rooted. The nightmare of 2020 came, not against the background of a healthy capitalist system that was taking society forward, but rather an ailing, weak and increasingly crisis-ridden one, which was already heading into a new slowdown prior to the pandemic.
Back in 2019 the IMF pointed out that so great was the level of UK corporate debt, almost 40% of it would become impossible to service in the event of a recession just half as deep as 2007-08. In this far greater economic contraction, only huge state intervention has prevented a far greater swathe of bankruptcies than have so far taken place.
Johnson's incompetence and divisions in his party are not the only reasons that Britain has done so badly in the pandemic. An even greater factor is the huge cuts that have taken place in the public sector, including to local authority public health budgets.
At the start of the crisis Britain had just over 4,000 intensive care beds, one of the lowest numbers in Europe. Italy for example had 8,000 and Germany 28,000. As demonstrated by the largely empty and unused Nightingale hospitals created at huge expense by the private sector, an even bigger problem was Britain's very low number of nurses and other health workers. In a World Health Organisation comparison of ten developed economies Britain languished in ninth place for its numbers of practising nurses and physicians.
The death rate from the virus is also higher because of the levels of poverty and overcrowding. Deaths from respiratory diseases are three times as high in Britain than the European average, with death rates highest in regions with high levels of poverty - South Wales, Glasgow and Liverpool top the table.
The experience of the last decade of capitalist crisis and austerity, coming on top of 40 years of relentless anti-working class neoliberal policies, has eaten away the foundations of social support for all the institutions of capitalism.
A series of expressions of class rage
For many commentators it seems that British capitalism has been buffeted by a series of unrelated and inexplicable tragedies - ranging from the Brexit vote, to the election of Jeremy Corbyn as Labour leader, to the rise of support for independence in Scotland, to having an unreliable populist as Tory prime minister. In reality all these varied phenomena have something in common: the anger of millions of working-class people at their falling living standards and the search for a means to protest against it.
This was the root cause of the size of the working-class vote for Brexit. However, in the absence of a mass left force putting the case for socialist opposition to the neoliberal diktats of the EU, room was left for right-wing populist forces to dominate.
There was nothing automatic about this. Had Jeremy Corbyn - then newly elected as Labour leader - defied the Labour right and, as we argued for, called for a vote for Brexit on the basis of opposing the pro-big business rules of the EU bosses' club, it would have created an entirely different situation.
Such a stance, both at the time of the referendum and afterwards, would have been an important factor in Corbyn winning a general election. Now, with a thin Tory Brexit deal which will further exacerbate British capitalism's crisis, it is difficult to imagine how different the situation could have been. A left government taking socialist measures and making an appeal to workers across the EU to support its opposition to the anti-working class, pro-privatisation rules of the EU would have been in an infinitely more powerful negotiating position than this weak, divided Tory government.
Johnson's Brexit deal
Of course all Tory governments, regardless of whether they are pro or anti-EU membership, act in complete opposition to the interests of the working class. Johnson has been negotiating from what he perceives to be the interests of British capitalism. He is claiming to have negotiated a tremendous victory that allows more 'freedom' for big business.
Only a tiny minority of the British capitalist class will be pleased with deal, however, although most will be relieved that it wasn't a worse 'no deal' Brexit.
It is true that the deal allows the continuation of tariff-free goods trading between Britain and the EU, while at the same time allowing Britain's government to divert from the EU's level playing field, including on state aid. However, this only pushes arguments further down the road, as the EU will have the right to take measures against British imports, including introducing tariffs if at any point it considers Britain has gone too far.
Even now, the increased regulatory checks required at borders will be a significant headache for exporters. At the same time, no deal has yet been negotiated for finance and services, which make up 80% of Britain's economy. On fishing, only very limited concessions have been won.
Meanwhile, Northern Ireland will still be expected to obey the EU customs union rules in order to prevent a hard border with the Republic of Ireland. The result - for all Johnson's denial that this would be the case - will effectively be a border in the Irish Sea. The DUP has therefore pledged to vote against the deal.
It was always ruled out that the capitalist politicians of Ireland, Britain and the EU27 would reach an agreement that satisfied the national, religious and cultural differences - and the economic needs of the working class - across Ireland. Only a programme for a socialist Ireland and a genuinely equal, voluntary, socialist federation of Ireland, Scotland, Wales and England could do that. Johnson is going to preside over a significant increase of sectarian tensions in Northern Ireland and a growing movement for independence in Scotland.
Johnson's vision of Brexit Britain
For what? Johnson's wing of the Tories were reliant on their right-wing populist campaign to 'get Brexit done' to win the general election. Beyond that, despite their denials, they aspire to turn Britain into 'Singapore on Thames'. Doing so would be likely to lead to EU tariffs and, even if achieved, would be a million miles from their propaganda promising the restoration of Britain to an imperialist power of the first rank.
Rather it means Britain going further down the road of being a low-corporation tax, low-regulation economy, reliant for example on 'free ports' - aka super-exploitation tax free zones, and becoming a flag of convenience for international shipping.
Johnson hopes this could be combined with state aid for high-tech industries. It is only necessary to look at the government's record over the last year to see that any such attempts would largely end up as bungs to their mates for no-hope projects. The prospect of them leading to Britain competing with the major blocs of the US, China, Japan and the EU is ruled out, with the possible exception of a few small industrial sectors.
Nonetheless, the Brexit deal was agreed by parliament, reflecting the desperation of the majority of the capitalist class to prevent a disorderly no-deal crash out. Despite mutterings the big majority of the Tory right voted for the deal, plus Starmer whipped Labour MPs to vote for it. This is yet another example of his determination to show British capitalism that he can be relied on to act in its interests. Thirty six Labour MPs rebelled. These were a combination of some lefts, plus right-wing pro-EU MPs who do not oppose the deal as the bosses' charter for super-exploitation that it is, but rather because they would prefer a bosses' deal that more closely aligns Britain with the EU.
The passage of the Brexit deal through parliament, however, will not bring peace to the parliamentary Tory party. The undermining of the social basis of the Tory party is ultimately a reflection of the decline of British capitalism. In the 1950s the Tories' membership peaked at over two million, even in 1990 it had 400,000 members, now it is barely a quarter of that and does not represent the views of the majority of the ruling class.
Resting on a very narrow social base, only able to win a general election by promoting a 'Trump-lite' right-wing populist, the Tory party is a very weak and unreliable tool for British capitalism.
The more than 20 u-turns made in 2020 show how easily it can be forced to change course under mass pressure. With numerous aspects of Britain's relations with the EU still to be negotiated, a dire economic crisis, and a continuing pandemic, new schisms will develop in the Tory party in the coming months. Faced with a mass united movement of the working class they could quickly be forced from office.
The one advantage that the capitalist class has chalked up in 2020 is the election of Starmer as leader of the Labour party. He is a reliable representative of capitalist interests, waiting in the wings should the Johnson government collapse. He has burnished these credentials repeatedly with his parliamentary voting record and failure to oppose Johnson, and even more with his willingness to wage a ruthless 'scorched earth' war against Corbynism.
Not only has Corbyn been forced to sit as an independent MP but swathes of Labour party members and local Labour party organisations have been suspended for supporting him. Under Tony Blair a handful of left Labour MPs remained as prisoners of the pro-capitalist right, able to occasionally smuggle out a note through the bars. Under Starmer's version of New Labourism, not even that is allowed.
Need for a new workers' party
The question of a political voice for the working class is therefore extremely urgent in 2021, when the working class is facing an economic and social catastrophe, and urgently needs effective tools to defend itself. Labour councils are not prepared to fight cuts.
Without such a party struggle will still take place. Occupations of workplaces threatened with closure could, for example, take place on a much bigger scale than in recent decades. However, such struggles would be given enormous confidence by the existence of a powerful mass party that, in order to save jobs and incomes, fights for the nationalisation - under democratic workers' control and management - of companies facing bankruptcy, as a part of a socialist programme.
Similarly the battle against the public sector pay freeze would be given confidence by a mass voice arguing for a huge expansion of the public sector in order to provide much needed jobs and services.
Having failed to transform Labour into a workers' party when Corbyn was leader, hoping against hope that this might happen under Starmer is not a viable strategy. It is urgent that serious action is taken. Jeremy Corbyn has announced a new 'Project for Peace and Justice', to be launched in January. Unfortunately this shows no signs of being a significant step towards building a new workers' party.
Its limited written material so far focuses overwhelmingly on international issues, and as the online left newspaper the Canary put it, proposes to "work beyond political party lines and to foster cooperation and change outside of established democratic processes."
The Canary admits that "there may be some disappointment that Corbyn hasn't launched a new political party in the face of the continuing demise of the Labour Party."
If the project develops on these lines it will indeed be disappointing for working-class people facing the choice in the May 2021 elections between voting for different shades of pro-austerity politicians. If this project limits itself to "change outside of established democratic processes" it will rightly be judged to be avoiding the issue.
If instead Corbyn was to take up the suggestion of the RMT London regional council to back an anti-cuts candidate for London mayor, and to launch his own candidature, backed by a list of trade unionists, socialists, and community campaigners on an anti-cuts platform, it could have a dramatic effect in combating Starmer, inspiring and rallying all those previously enthused by Corbyn's leadership of the Labour party.
Even more important than Corbyn's actions as an individual, however, is the responsibility that lies with left trade union leaders inside and outside the Labour party. Those affiliated to Labour have correctly protested against Corbyn's suspension and other undemocratic measures taken by Starmer. It is necessary, however, to go further.
If the left-led unions were to seize the moment, with the support of even a handful of MPs and councillors, and to launch a conference to fight for political representation for the workers' movement, it could transform the situation. If a conference agreed even on limited steps, such as freeing trade union branches to stand or back anti-cuts candidates in May's elections, and setting up a trade union group in parliament (perhaps proposing Corbyn as its chair) - it would do more to fight back against Starmerism than any amount of pleading behind closed doors.
The right's determination to obliterate the Labour left is clear. If the time is not now for the left to show similar determination to fight for a socialist voice for the working class, when is?
The Socialist Party believes that what is needed is a new mass workers' party, and appeals to all those who agree to join us in that struggle. A failure to take steps in this direction will also leave more space for Farage and his ilk to step into the vacuum.
As a starting point, the Trade Unionist and Socialist Coalition (TUSC), involving the RMT transport workers' union, the Socialist Party, ex-Labour MP Chris Williamson, and others, is back in action and preparing to stand as widely as possible in the elections next May against pro-capitalist, pro-cuts Labour candidates.
Fight for socialism
The last year has driven home the catastrophic failures of capitalism. Growing inequality, dire impoverishment, and a complete inability to effectively combat a virus have all been writ large.
Enormous state intervention, previously considered unthinkable by capitalist politicians, has proved necessary to try to prop up their system. Meanwhile millions of workers have felt the importance of their low-paid and undervalued jobs in keeping society functioning.
The search for an alternative to capitalism is on the rise.
Only by taking decisive socialist measures will it be possible to harness the enormous wealth, science and technique that capitalism has created through the labour of the working class, to start to meet people's needs, and to safeguard the environment.
That would require breaking with profit-driven, ailing capitalism and taking the major corporations and banks which dominate the economy into democratic public ownership, allowing the development of a democratic, socialist planned economy in Britain and internationally.
The priorities of a socialist economy would be decided democratically. Instead of filling the coffers of corporate chief executives, priorities would include providing a real, living income for all, mass building of high-quality and carbon-neutral housing, and creating and expanding decent public services, health care and education. If you want to join the fight for a socialist world, join the Socialist Party.
- This article has been updated on 06.01.21 to reflect the version published in print issue 1115 of the Socialist.
In The Socialist 30 December 2020: