Fighting the Cuts Means Fighting Capitalism

Report of CWO militant After the March 26 Demonstration. The demo itself was just as we predicted - unfortunately. A hell of a lot of people but no single thread to the 'demands' or slogans; many people just had their own slogans. It was very closely stewarded by the TUC itself - they didn't need the police. Everyone just filed up the Embankment to Hyde Park and filed out again after (mostly) passively listening to a few speeches (not even sure who was speaking apart from Miliband). There were still people coming into the Park while others were leaving and the speeches were over. The feeling was of people looking for a solution but with no idea what to do next.

It’s cold comfort to report that the TUC’s so-called ‘march for the alternative’ went off like the proverbial damp squib. From the point of view of turnout it was impressive enough. Most commentators reckon there were half a million people and acknowledge it was the biggest demo in London since the 2003 protest against Blair’s decision to join in the invasion of Iraq. However, aside from the numbers and the obvious sincerity of the protestors (many had come armed with their own, more imaginative, slogans) the event was further confirmation of the lack of any alternative being put forward to the existing political and economic set-up. On the contrary, the tightly organised, carefully stewarded procession which the TUC had already largely restricted to public sector workers and which - with the aid of the police - was kept immune from ‘unauthorised’ feeder groups, notably a whole contingent of students (i.e. not simply “troublemaking rabble”) - was a clear echo of the insidious, divisive role the unions play under the guise of organising a fight back. For a start, simply because the issue of the hour is the Con-Dems’ £80bn state spending cut programme, does not mean that the effect of those cuts is limited to workers employed by the state nor even the people immediately affected by the loss of a local service. The TUC was ready enough to have the ‘victims’ of social service cuts march alongside the bands of public sector workers who face unemployment or increased work loads, a two year wage freeze, pension cuts while payments from their wages go up … but where were the contingents from the rest of the working class?

Many workers would only have been made aware of this march - which had taken the TUC six months or more to organise - when it appeared on the telly news some time between the boat race and the football results and accompanied by more dramatic shots of the radical reformists of UK Uncut occupying Fortnum and Masons and the antics of the self-styled anarchists in Oxford Street and (later) Trafalgar Square. Whilst this underlines the high level of privatisation and low level of class consciousness amongst workers in Britain it also highlights the TUC’s talent for undermining the strength of the working class. Not only would involvement of workers with potentially a lot more clout than those from the service sector have raised the stakes it could have clarified that the issue is not just about fighting ‘Tory cuts’ and controlling wicked bankers. (Although it might also have clarified that most workers, especially in the private sector are not in a union.)

The Real Issue

The real issue is that the working class as a whole is being made to pay for the capitalist crisis. Not just here but worldwide. Moreover, despite all the rhetoric about greedy bankers, this crisis stems from the contradictions at the heart of capitalist production where the companies responsible for manufacturing, extracting, even agricultural production, all essential to the ‘real’ economy are driven by the necessity to increase profits and yet the more effectively they do so the more the general rate of profit declines. For decades capital has been striving to reduce its costs of production in order to combat the low rate of profit, no more so than what bosses the world over regard as their most expensive ‘cost’ - wages. This is glaringly obvious when it comes to the shifting of production to China and other areas of cheap labour power (i.e. rock bottom living standards). What is less obvious is that this is not the end of the process. For capital now the benchmark for wage costs is defined by Chinese, even Vietnamese or Bangladeshi wage rates, a benchmark which brings its own logic to the established heartlands of capitalism: the necessity to reduce wage costs even further, not simply by individual firms making direct wage cuts but by a general lowering of wages and the undermining of a welfare cushion which at its most basic guaranteed a certain level of survival for people unable to work and protected people without a job from having to work for next to nothing.

This is not to deny the financial crisis and its knock-on effects for government finances or the cost of servicing the enormous national debts that suddenly swelled when the richest states in the world, from the USA through the EU to little old UK, found themselves with no alternative but to take over the debts of the financial sector when the speculative bubble finally exploded. The fact that the bubble was actively encouraged by governments and financial authorities worldwide by low interest rates, relaxation of consumer credit regulations and the general deregulation of the banking and financial sector, is now being forgotten as the whole thing is presented as the result of … greedy bankers! Their rates of return on capital were attractively high due to the ‘excess liquidity’ from the ‘real economy’ (i.e. the capital which was not being invested in production because bigger profits could be had from the financial sphere). In other words, the ‘credit crunch’ and the bursting of the financial bubble are part of a much deeper and intractable capitalist crisis which has now lasted for decades, with each downward spiral leaving the capitalists and their governments with less and less room for manoeuvre and, from the capitalist standpoint, with no option but to attack the working class. In fact, the crisis over budget deficits has been seized on by governments everywhere as the opportunity for a general and head-on assault on the working class in general. Of course, this is not how it’s being presented. The overarching theme is still that ‘we are all in this together’. Like one big family which has mismanaged its finances and which now must work together to pay off its debts, ‘the nation’ must pull together and accept sacrifices in this difficult time of austerity. Which brings us back to the TUC and March 26.

The TUC “Solution”

As a point of fact Brendan Barber, TUC general secretary, has rejected the analogy of a household that has ‘maxed out on its credit card’:

Unlike households, sovereign nations can print money, raise taxes and fund debt over many decades.

This in a nutshell, is his classical Keynesian answer to the present situation which he compares to the 1930s:

Massive cuts are a false economy. As we saw in the 1930s, austerity begets more austerity - more unemployment, more misery for working people, and yes, more national debt.

Barber is under the illusion that the deficit today can be solved by more, not less, state spending as in 1945 when the UK was effectively bankrupt but:

within a decade we had got the economy back on track, built the NHS, extended the welfare state, and constructed millions of council homes. And through growth and full employment, Britain also got its deficit down.

What he fails to see is that the post-war recovery and higher growth rates (read rate of profit) was predicated on six years of global war, involving massive austerity, not to mention loss of life, capital destruction and the running of machinery and equipment into the ground, all of which were necessary to prepare the way for capitalism’s revival. Deficit financing was the capitalists first response to the present global crisis. It was ditched in favour of ‘monetarism’ and ‘free markets’ in the face of rampant inflation and the collapse of the post-war Bretton Woods fixed exchange order. His call now for an injection of state funding (unfortunately he seems to think that quantitative easing in the US has done the trick. Hasn’t he heard of Wisconsin?) is sure to fall on deaf ears.

Transferred from the realm of intellectual argument Barber presented the TUC’s alternative to the masses in Hyde Park:

Let's keep people in work and get our economy growing. Let's get tax revenues flowing and tackle the tax cheats. And let's have a Robin Hood Tax on the banks, so they pay us back for the mess they caused.

A Fake Campaign

And the response to the cuts themselves? As in the US, a large share of the ‘austerity measures’ are being doled out at local level. This is ideal for the government as a way of breaking up any resistance. It is ideal for the TUC as a way of riding on the back of, and taking credit for, local protests when opportune or for ignoring them and letting them fizzle out when they see no particular gain to be made. The TUC waited until the end of the financial year to hold its anti-cuts demo. In other words the debates and voting in local council chambers as to where the axe would fall were already over before the jamboree in Hyde Park. No question then of demanding from the Labour Party, even now dependant on funding from the unions, that its councillors refuse to vote for the cuts. On the contrary, Barber announced at the demo that ‘this is just the beginning of our campaign'... In other words, the Labour Party has not been embarrassed by the spectacle of a repeat of what happened in Lambeth and, more famously, Liverpool in the 1980s when 47 Labour councillors were perfunctorily removed from office and personally surcharged for refusing to implement spending cuts. The whole thing proved to be a major impetus towards the formation of ‘New Labour’ - i.e. a Labour Party no longer exclusively aiming for the working class vote - and the ditching of Clause 4 from the Party’s constitution (nationalisation of the ‘commanding heights of the economy’). Still, the new New Labour leader’s decision to address the Hyde Park rally was a tricky one. The last thing Miliband wants is to present himself as the poodle of the TUC. At the same time he needs to retain the loyalty of the traditional Labour voter; on the other hand, how to capture the vote of ‘middle England’ (whoever that is)? The trick is to appear to be what he really is: the leader of her majesty’s loyal opposition and to let it be felt that Labour and the TUC are the embodiment of ‘the nation’. In a speech littered with nationalist claptrap and empty phrases Miliband got away with saying nothing:

We recall the greatest moments of our country’s history … Standing up for our country … Standing up for fairness … Standing up for change …

Not a word about the working class, much less ‘socialism’. He did, however, manage to mention that “We do need to cut the deficit.” (Just in case ‘middle England’ began to think he was a raving militant). Clearly the only alternative on offer is the prospect of Labour returning to office at the next election. Too soon, of course, to openly call for that but it’s a prospect implicitly endorsed by the likes of Socialist Worker (with its headline ‘Drive Out the Tory Scum’) and the rest of the platform speakers proclaiming platitudes such as this government has ‘no mandate for these cuts’. (Barber had already claimed to be speaking for the people of Britain.) Meanwhile, before the next election, we can all go back to our localities and ‘fight the government's brutal cuts in our workplaces and our communities’ (Barber again): lunch time ‘strikes’, for example … or what about day schools? Then of course there is the demo of the ‘Hardest Hit (disabled) outside Parliament on 11 May... And so on.

There is Only One Alternative

Even today there are grassroots militants who are prepared to fight tooth and claw for a real class struggle within the frame of the unions and inside the capitalist political set up. This is touching (we are not intending to be sarcastic) but ultimately a fruitless endeavour. The National Shop Stewards Network, for example, who believe that the 26 March demo gave a boost of confidence to the struggle against the cuts and are advising their members to go to their union branch meetings with proposals to co-ordinate strike action and motions that the unions combine to plan for a ‘24 hour public sector general strike’ [sic]. Their attempt to be ‘realistic’ exposes the futility of relying on the unions to generalise (i.e. strengthen the class struggle).

In the political realm there is the Trade Unionist and Socialist Coalition [TUSC], associated with Dave Nellist. It will be putting up candidates in the May local elections who

pledge to oppose all cuts in council jobs, services, pay and conditions. We will campaign against the idea that 'some cuts' are necessary.

At the level of class instinct this is admirable. The bleak truth is, however that the struggle for a new world order has to be defined by more than a gut instinct. It’s true that this battle against the cuts - and against the future attacks on workers’ living and working conditions which inevitably lie ahead - will ultimately have to be resisted in a political way. That is, in a way which directly challenges the capitalist order, because at the end of the day, the only way to overcome the measures demanded by a capitalist system in crisis is to pose an alternative to capitalism itself. Unfortunately

bringing into democratic public ownership the major companies and banks that dominate the economy, so that production and services can be planned to meet the needs of all and to protect the environment

TUSC statement of aims

is simply a regurgitation of Old Labour’s Clause 4: the myth that nationalisation equals socialisation. This sort of thinking, together with the belief that working class interests can be seriously defended inside the capitalist council chambers is the sort of thing communist militants have to be able to answer.

In the months and years of struggle ahead, the onus is on revolutionary internationalists to put flesh and bones onto the communist programme. To remind working class militants that it is not enough for workers to take over the existing state, but that they have to overthrow it. In the more immediate term the question needs to be posed about how the struggle can be extended: for sure not by keeping to union boundaries, nor to the unions’ acceptance of capitalist legality (for example over ballots for strikes). As the crisis intensifies there will be a torrent of nationalist propaganda from all factions of the ruling class. A true socialist or communist will be distinguished by rejection of the old Labour claptrap about nationalisation (or ‘public ownership’ of the means of production) by their awareness that the capitalist crisis is global, that the working class is an internationally exploited class and that the answer to the iniquities of the present system of production for profit is for the working class world wide to take over production and institute direct democracy - based on immediately recallable delegates in communities and workplaces - in order to directly meet social needs. At least Labour and the TUC have stopped pretending they stand for socialism. Nobody should now pretend that they can be the vehicle for anything other than the preservation of capitalism. The task of the internationalists is to win over militants to the only viable alternative for the working class: the political struggle for the overthrow of capitalism and its states, a struggle which above all requires that workers en masse take up the communist programme. That is what we are working towards in the long term. To achieve this we appeal to those who broadly agree with our perspective to get in touch with a view to reinforcing the struggle against this iniquitous system.


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