Economic crisis deepens Two Johns agree: keep down pay more successful when it has con- centrated on the earlier links in- stead of going bald-headed for pay itself. (FT April 26) In any event most employers are quite happy to live with a controlled element of inflation, which they can use to nibble away at the living standards of they their workforce while protect their own profits through price increases. Employers are concered about pay settlements because they focus on the key issue of profitability - the level of ex- ploitation of the workforces as shown by the share of created value that is retained by the employer as profit. This is the very crux of the class struggle, and the bosses are beginning to grasp just how temporary was the change in the balance of forces brought about after the defeat of the miners' strike. Once more even some notoriously timid unions are pushing for - and often winning - much larger pay settlements, goaded into action to placate a rank and file that has been angered by years of concessions, job losses and now by accelerat-
them against the working class. wretched line of the Kinnock team. way as did Callaghan for a new Tory resurgence. fightback are the best ways to guard against defeat - and betrayal. ing inflation. A few sections - headed by Fords and the power workers - have just exceeded the current 9.4 percent level of inflation; but few private sector settle- below ments are eight percent, and this is now putting the pressure onto public sector management. NALGO local authority staff and even the usually pas. John Smith MP: no friend of the workers sive NALGO NHS white collar staff are moving towards strike ballots. Alarmed at this evidence of a new combativity and resistance to further cuts in the realk value of pay packets, the employers and ministers have begun a predict- able chorus of warings that excessive' pay rises could cause job losses. Early in April, the Govemor of the Bank of England, Robin Leigh-Pember- ton, admitted that: over the past two or three years something has gone quite badly wrong. policy mistakes
the main enemy is removed: more groups will feel confident enough to embark on industrial action and mass struggle. The scenario of the 197879 winter of discontent could be re-run as easily as the bankrupt policies which produced it. This helps explain the Labour leaders' reluctance to repeal Thatcher's anti-union laws: they are getting ready to use
First steps in preparing the political leadership that will be needed for in these confilcts to come have already begun. The Socialist Movement has held several successful conferences and begun to organise a socialist opposition in the trade unions and, most recently, in the Labour Party. Its discussions on policy and programme go beyond the abstractions of a debate on what we want from the next Labour goverment, and spell out the need to link up now with the struggles of the working class against the Thatcher government, and to organise a class struggle current ready to oppose the right wing policies on offer from Kinnock and Smith. Socialist Outlook has consistently argued the need for a Socialist Campaign for a Labour Victory that will spell out genuine alternatives to the
Of course we want a Labour government to replace Thatcher. No socialist wants to see the Tories allowed back for a fourth term: but neither do they want another cringing, right wing Labour government that quickly discredits itself and the name of socialism, and which paves the
Opposing Kinnock's preparations for government, and challenging the policies he is seeking to impose, while building the widest possible
Tand forecasting errors played a pant. Who should pay for these mistakes? The workers! He called for a light monetary policy and wage restraint - the old formula under which the workers are once more urged to tighten their belts to bail out the bosses. The panic grew. By the end of April the Tory chair of the Commons Treasury Committee was demanding the publication of a Treasury document that predicted British labour costs would double this year. In early May the CBI joined in the effort to intimidate SOCIALIST OUTLOOK no 25, June 1990
workers: Director General John Banham warned that:
*Higher interest rates and the uniform business rates mean that employers' ability to pay high wage settlements without job losses and unemployment is diminishing.'
Interestingly Mr Banham also criticised the fact that company dividends are rising twice as fast as corporate earnings, meaning = ing and spending the profits almost faster than the workers can create them, and opting for inflated life-styles ra sage has been studiously av
The hectoring of the W = cent leap in the Retail Price Index during April. Labour's John Smith pointed out that even the phony figures for the underlying rate' of inflation (favoured by Nigel Lawson because it excludes mortgages) is now at 7.9 percent, and that even if poll tax is left out of the sums it is still 6.5 percent -well above the European average.
Nevertheless Chancellor John Major told a guzzling crowd of capitalists at the CBI's annual dinner that they must hold down wage increases for their workforce and boost exports if 'we were to beat inflation, which *could destroy all our hopes for the coming years. Major apologised to many of the people who regard themselves as the government's natural supporters - in particular small businesses and homeowners on modest incomes, saying 'a painfree cure for inflation simply does not exist.
Thatcher herself joined the fray, with familiar threats that workers could price themselves out of a job; meanwhile figures showed productivity actually fell in 1989, while wage costs per unit of output rose to an average 10.1 percent.
Not a moment before John Major wanted it, came the first real signs that the squeeze he has been applying through punishing interest rates had borne fruit in a new round of job losses unemployment edged back up in SOCIALIST OUTLOOK no 25, June 1990
UPDATE ers are not Impressed by John Major's effect on April for the first time in nearly four years. There were announcements of jobs axed at Ford, British Telecom and the steel industry, and the CBI declared 50,000 jobs would be slashed in manufacturing in the next four months.
The financial whizz-kids actually welcomed the rise in unemployment (which of course is ludicrously understated in government figures: after more than 30 "adjustments' in eight years, the Unemployment Unit calculates that the real level of jobless people seeking work is almost a million higher, at just under 2.5 million).
The "company dividends are rising employers, t00, see unemployment, and the limited evidence of a slide back towards recession, as a positive help in their efforts to contain the working class. It is a pressure to hold down pay settlements, especially when used to frighten 'new realist union leaders. However the poll tax - a flat rate tax falling most heavily on the lowest paid - has radicalised new layers of workers, to the extent that even the anti-union laws are not having the expected effect: instead of producing votes against strike action, ballots in favour of action are delivering a weapon into the hands of surprised union negotiators.
their wage packets
Meanwhile the level of sterling in the money markets also takes account of the wages strug gle as a guage of the balance of class forces and the likely profitability of industry, as well as the balance of payments situation and interest rates. The Thatcher goverment has shot itself in the foot on every count: its own policies have stoked up inflation; the balance of payments are showing their second worst deficit in history, with exports almost static and imports still rising; and the working class is fighting back.
As a result, interest rates have
Wto be kept sky high in order to twice as fast as corporate attract suf-
ficient earnings: the capitalists are
specula -sharing the profits faster than the
Ative inworkers can create them"
vestment to keep sterling afloat. These rates could be forced up again as the West German govemment carries out its hugely expensive and inflationary unification with the GDR.
While the two Johns - Major and Smith - appear agreed on the desirability of 'stabilising' sterling by entering the European Monetary System, this would only be at the expense of the working class and weaker sections of capital. John Smith points out entry into EMS would be 'counter-inflationary' in that it would prevent any competitive devaluation of sterling that might allow companies to pay wage in-
POR GOE John Harris (NUJ) reases more easily.
For John Major and the dominant sections of capitalists, the best scenario would be a relatively swift, sharp pinch of recession to "discipline' the labour force, reduce spending power and thus imports, and allow a relaxation of interest rates to create the semblance of a pre-election "boom'.
Nothing could more clearly show the opposing class interests of workers and employers: yet John Smith, spelling out Labour's "alternative" economic policy, calls ludicrously for a "partnership' of labour with capital. Not waiting for the IMF to force a Labour govemment to cut public spending and workers' living standards, Smith is already volunteering to do so from day one. This is what Kinnock means when he says 'Capitalism is the system we live under; we must make it work better'.
The job of the trade union and labour movement is not to defend employers' profits but to improve the living standards of the working class. As the tide of inflation swells, there is an urgent need to include a demand for wage settlements to be protected through cost of living clauses to provide regular adjustments to keep pace with price rises. There must be new trade union efforts to defend jobs and halt closures.
All this sounds grimly familiar. Despite the hype of a Thatcher "revolution', not much has changed: and if Kinnock gets his way, not much will.
Page 3
Tories play the racist card Once again senior figures in the Tory Party are looking to that trusty old stalwart racism to rekindle popular support, most clearly exemplified by Norman Tebbit
Tebbit and his band of chauvinistic rebels have gone on a binge, expressing the overt racism that always bubbles beneath the surface of Tory political practice.
Not only were the people of Hong Kong the victims of the Tory right's attempts to stir up racism - but all non-white people in Britain were spotlighted for abuse by Tebbit's infamous 'cricket test' remarks.
Whilst a worried press tried to convince the public that others in the Tory party did not agree with him, there was quite clearly not even a mild rebuke from the leadership.
Although some have drawn parallels with Enoch Powell's "rivers of blood' speech, also made when the Tories popularity was on the wane, today's developments are very different. Then, Ted Heath was seen to wag a finger and proclaim that way lies tyranny': now, from Thatcher there is merely a telling silence.
The fact is that what caused the slump in fortunes for the fascist right in the late 1970s was that Thatcher and the Tory Party stole their clothes when she proclaimed that the British subculture was being 'swamped", and insisted on the need for more immigration controls.
However the renaissance of racism in the Tebbit form has been a kiss of life to the remnants of the old fascist groupings; this has been particularly the case in East London. In the last few months racist attacks throughout the area have been increasing.
The British National Party (BNP) has felt able once again to hold meetings in predominantly black areas such as a school in Page 4
UPDATE ne.
In Waltham Forest
uncil which includes
constituency of Chingford) there have been racist marches
1e Labour council creating three holidays on non christian religious festivals. This was at first organised by individual racist parents, but it did not take long before Tebbit latched onto the march in order to give it his blessing.
The fascists have also picked up on marches/initiatives by unorganised racist parents elsewhere. They tried to become involved in a march in Tower Hamlets concerning the stabbing of a white pupil by a black pupil at school; and there has been increasing interference from so called 'choice groups' attempting to get white pupils to the schools of their "parents' choice. This has continued on from Dewsbury in Yorkshire with the misnamed 'Freedom Association' attempting to give a veneer of intellectual' cover to an emerg ing new ultra-right, while hysterical headlines in the Sun have helped agitate the backward white working class.
Tebbit's utterings, the fascist right gatherings, and Thatcher's calculated silence have resuscitated as always not only in an increase in passive racism but also active violent racism. CAPA, a legal advice and support group based in Tower Hamlets, had 482 reports of racially motivated attacks for the year ending March 1989. The number of cases of racial harrassment went up by over 20% in a similar period. Attacks in April showed a continued increase.
Labour's equivocal stance on
Funeral procession after racist murders in Walthamstow almost all recent issues of anti- passed but remain a paper policy racism has done nothing to halt the rising tide of racism (with the notable exception of the Campaign Group members who most recently took the principled step of abstaining on the Hong Kong Bill.) While a number of left MPs continue to be wide of the mark over the Rushdie affair, still pandering to fundamentalists by calling for a extension of the blasphemy laws, the Labour Party leadership's concessions to religious schools will do nothing but transfer power to fundamentalist leaders and fuel racism.
In addition the half-hearted multiculturalism of many coun cils means that resolutions are
leaders feared at the hands of
the Islamic Party in last
month's council elections
didn't happen.
Islamic Party candidates stood
in four seats in Bolton, two in
Blackburn and one in Derby: all
seats with between a third and
three quarters of Muslim voters
In Blackburn an Islamic victory could have deprived Labour
of its two seat council majority
and by implication, Jack Straw of his marginal parliamentary
seat in the next election). In Bolton, Islamic Party candidates fought Labour's housing chair in another key parliamentary marginal seat - a traditional testing
Andrew Wiard/Report since there is no effort to convince the public of such a stand. In Waltham Forest the council would not politically challenge the racist marches; it simply battened down its hatches and ig nored the problem, leaving the hard left to struggle against the racists' arguments and the threat of fascist violence.
It is clear today, in the 10th anniversary year of Newham Monitoring project, that the fight for clear anti-racism should be a priority for all socialists: organisations such as Anti-Fascist Action must be supported in their mobilisations to smash the fascist groupings.