AS THE POUND collapsed last Thursday, Labour economic spokespersons Gordon Brown and Harriet Harman flitted around the TV studios. But they had absolutely nothing by way of an opposition policy, or indeed anything intelligible, to pronounce.
The reason is obvious: Labour policy has moved so far to the right that John Smith was advocating ERM membership before the Tories adopted it, and even Keynesian growth policies have been abandoned.
Harman and Brown argued for minor measures for 'training' and small-scale help for the housing market. But it is totally incredible to believe that these very cautious measures would have led to any fundamental change in the economy if Labour had been elected.
Half-way Any policy that is half way oppositional to what the Tories are doing, let alone socialist, has to propose measures to promote economic growth, create jobs, drastically cuts interest rates, and get the economy out of recession.
But even these measures for capitalist growth elude th nt Labour leadership.
Even if the devaluation of the pound leads to interest rate cuts, the economic situation now directly leads to more huge attacks on the While the currency crisis dominated the headlines, government ministers were meeting to decide next year's public spending Tax revenue has slumped with the economy, and major cuts are inevitable. A public sector wage freeze could be one consequence of this situation. Other cutbacks in benefits and social spending are almost certain.
At thesame time, unemployment is skyrocketing, with the real figure at more than 4 million and 50 people chasing each vacancy in the The tragedy of the situation, and the big danger, is that here we have a giant economic crisis, a massive attack on the working class, and the forces of real opposition to slump policies are tiny, given the total abdication by Smith ana company. All this of course is the direct consequence of what has happened to the Labour Party over the last decade; the rightward move, as Labour goes into its annual conference, has reached grotesque proportions. As we report on page 5, this year's TUC was marked by the growing ascendency of business unionism, and the open abandonment of any form of challenge to the diktats of the "John Major's oft-repeated argument that 'inflation hurts the poorest in society' is ideological claptrap."
Not out of the woods yet... government and employers. This is echoed in the Labour Party by MPs coming out openly for coalitionism, and the adoption by the Smith leadership of positions on the economy and the welfare state which broadly parallel those of Tory think tanks.
It is possible that under the pressure of sections of their business base, the Tories themselves could now go for cutting interest rates and limited economic growth. But the structure of British capitalism today, the immense weight of the financial sector, and of interests whose investments are located abroad, makes this by The aim of capitalism is not 'economic growth but profits. Finance capital wants against inflation'. This was the original logic of locking the pound in the ERM and tying it to the Deutschmark.
John Major's oft-repeated argument that 'inflation hurts the poorest in society' is ideological claptrap. If the heroic struggle for 'zero inflation' is pursued it means just more unemployment, more attacks on the welfare state, and mass poverty.
Imagine Labour had won the election. The new Labour government, like previous ones, would have been at the mercy of the currency speculators and could have been brought down by the pound's crisis. Once market forces are unfettered either a Labour government does what the capitalists want, or they launch an all-out attack against it.
The recent events show that any realistic socialist policy would have to be based on attacking the power of capital. Nationalisation A socialist plan to combat the present economic crisis would have to start by nationalising the banks and finance houses. It would have to create a vast programme of public works and sociallycontrolled investment. And none of these things would be accepted by capital, or imposed by them, without the most gigantic struggle. Such policies could only be advocated in the context of actually organising a struggle against unemployment, against welfare cuts, against the anti-union laws, against the destruction of local government - against the whole Tory offensive.
This kind of thinking is of course a million miles away from that of the current Labour and trade union leadership. Which is why Major and Lamont can afford to ignore the huffing and puffing of John Smith; and it is why the left in the labour movement faces a long hard struggle back to defeat the iron grip of business unionism and post-Kinnockite Next week's Labour conference will show the leftat a new low point. Any dramatic short-term breakthrough by the left is off the agenda. But by sticking to its guns, by supporting each and every trade union struggle which arises, by building the anti-racist fight, through a myriad of campaigns and through continuing to argue the socialist alternative, the left prepares the basis for capitalising on the inevitable crisis of the current leadership of the labour movement.
No. 28 26 Sept, 1992
cran Labour News