Source: Militant, no. 14 (March 1966)
Transcription: Francesco 2009
Proofread: Fred 2009
Markup: Niklas 2009
According to the national opinion polls of the middle of February the Labour Party now has a lead of 13.5 percent over the Tories. This in spite of the drastic measures taken by the Labour government in the field of taxation and retrenchment. The mass of the people instinctively believe the Tories are responsible for the plight of the economy at the present time. Thirteen years of Tory government [1951-64] have seen British capitalism falling behind their main capitalist rivals in the fields of education, technique and production. It has seen British capitalism beaten on the home market by her rivals abroad.
The vain attempt to maintain the power of British imperialism has virtually bankrupted British capitalism. It is one of the main causes of the chronic balance of payments crises, every two years. In the three years 1953-55 it averaged £254 million. Government expenditures abroad mainly for military purposes and bases totalled £695 million. In 1962-1964 it averaged £237 million and government expenditure abroad was £1,304 million!
Yet we have the propaganda of the capitalist press and the politicians day in day out trying to put the responsibility on the lack of effort of the working class. It would be the duty of a government claiming to represent Labour to expose the pretensions of the capitalists and place the facts before the working class. In this way the working class and the people generally could be prepared for drastic measures against the capitalists.
Instead of this in a speech to the Overseas Bankers Club of the 7th February Wilson boasted:
“The measures that were taken were tough, stringent and unpopular and have shown to the world the priority that Britain attached to a sound economic position and a strong balance of payments… the wise counsel and firm action of Mr. Governor… In the past year they set out to get a grip on public expenditure and in the face of strong opposition made the cuts in production programmes, particularly aircraft… In every area of British industry where production is held back or rendered more costly by a demarcation argument, the fact must be brought home that we are facing ruthless competition… More than once when the Chancellor and I were discussing the severity of the attack, I had occasion to quote the words of the Duke of Wellington at Waterloo—‘Hard pounding this, gentlemen. Let us see who will pound longest’.”
Cuts in “state expenditure” insolently demanded by the industrialists and bankers were signalled by the attack of the governor of the Bank of England, an employee of the government but in reality a representative of the “City.” These cuts were in useful public works which limited local authority schemes to about £150 million. It meant the abandonment of the extensive election programme of building hospitals, schools and universities. Due to the measures taken, including the raising of the bank rate, the housing programme is well below the modest target set of 400,000 houses last year. Only 365,000 houses were built despite the terrible shortage of houses. This is far below the pre-war figures when they had a quarter less population.
At the same time heavy taxation was imposed on the “consumers” i.e. the working class. Now hire purchase terms have been further reduced. Formerly reduced from 3 years to 30 months on certain articles, it is now changed to 27 months. Minimum deposits have been increased on furniture and mattresses from 10 percent to 15 percent. The maximum repayment has been reduced from 36 to 30 months. On radio and television sets, tape recorders, vacuum cleaners, refrigerators, washing machines and carpets, the minimum deposit has been further raised from 15 to 25 percent.
These modest “luxuries,” under modern conditions of many wives working really necessities, are thus placed beyond the reach of the lower-paid sections of the working class. When the Tories introduced similar restrictions Wilson had argued that this involved social bias against people of modest incomes.
Unfortunately the measures of the government have been even more stringent and restrictive than those of the Tories. At every opportunity the Prime Minister in particular has attacked so called “demarcation disputes” and “restrictive practices.” Even if true and it is not correct, this would not amount to a hundred thousandth part of the waste, inefficiency and restrictive monopolistic practices of big business, on which Wilson is silent.
Wilson tells the bankers and industrialists what they want to hear. While threatening the trade unions and the working class he kow-tows to the capitalists. No wonder for the moment they regard him as another version of Supermac [Note: a reference to the previous Tory Prime Minister, MacMillan] and praise him as a “statesman.” It is not so long ago that they ranted and raved in maniacal fashion against the Labour government and its chief minister.
Now Wilson who formerly attacked mergers and monopolies comes out in favour and actually assists in the process of “merging and monopolisation.” Everything is turned on its head. The capitalists are assisted, the wages of the workers are restricted. The tops of industry and the state receive increases of salaries from 12 to 50 percent including the members of Parliament themselves, the workers they try and restrict to 3.5 percent and then with strings. As Mr. Jay declared in the Commons on 7th February:
“Individual investment continues at a high level; and exports have been rising strongly. In these circumstances we must continue to ensure that consumption does not make undue demands upon our resources.”
This means in practice that the re-equipment of British industry in so far as it proceeds will be at the expense of the working class.
Meanwhile the rich grow richer than ever. Profits continually break records. Last year they were higher than ever. Surtax rose by £6 million to £184.4 million. The number of surtax payers grew by 9,000 to 305,000. The economy works for the benefit of this tiny segment of the population. The myth of an “equalisation of incomes” and a one-class structure in Britain is soon dispelled when one examines the figures of the Inland Revenue. Nearly 15 million people own less than £1,000. At the same time 110 people have incomes of more than £100,000 or nearly £2,000 per week!
Under these conditions the policy of Wilson cannot be distinguished from the policy of the Tories. No wonder the most discerning tops of big business are complacent at the possibility of a further extension of Labour government. They achieve two objects. On the one hand they smear the labour movement with the crimes and failings of capitalism, which they then pretend are due to socialism; and on the other hand they find it easier to use the Labour government to try and carry out policies which would meet with stiff resistance if introduced by the Tories.
The working class asks very little from society at the present time, peace, homes, security, decent wages and conditions, a reasonable education leisure and recreation. Even after 20 years of relative economic upswing capitalism fails to provide these basic necessities.
At the same time as competition on the world market gets fiercer the capitalists of all countries adopt similar measures of “modernisation,” subsidies to the industrialists to introduce new machinery “incomes policy” etc. etc. Thus because the British capitalists have lagged behind, it will be difficult for them to catch up.
Like their rivals they try and impose the costs of this on to the working class. But all doing it mutually over a period it will cancel out. Only the working class of all these countries will be worse off.
Thus the narrow nationally limited and imperialist policy of Wilson cannot solve any of the problems facing British capitalism. On a capitalist basis every government is compelled to act in a similar way. Only a breakaway from capitalist policies can end the impasse. As a start it would be necessary to nationalise with minimum compensation, the private banks, the insurance companies, and the 400 monopolies, who between them control two-thirds of the wealth of the country. Then on a democratic basis mapping out the resources of the country, harnessing the £100,000 million of wealth in factories, buildings, machinery, etc. built up by technique and the labour of the working class. By drawing in the workers and scientists, the technicians and small businessmen housewives and co-ops, the basis could be laid for a 20 percent and even more increase in production, which could be rapidly used to transform the economic and social situation in Britain.
Explaining the real crisis of capitalism and fighting on such a programme the Labour Party could obtain an immense majority. However, even on the present limited programme the obtaining of a big majority would pose very favourable opportunities for the transformation of the labour movement.