Ted Grant

Prices and incomes—No wage restrictions—For a socialist plan

Source: Militant, No. 13 (February 1966)
Transcription: Francesco 2009
Markup: Niklas 2009

The British economy grew by the miserable figure of 2 percent in 1965, and according to the latest forecast of the economic experts will only grow by the same miserable figure, at best, in 1966. Thus the economy manifests the same disease of virtual stagnation as under the Tories.

The measures that Wilson has taken, under the pressure of the bankers and industrialists, have also been virtually the same stop-go financial and economic policies that ended so disastrously in the balance of payments crisis. Following on the demands of big business, government expenditure on “wasteful” social services was slashed. Housing, hospitals, schools, education, roads and other social services have all suffered cuts. In addition the raising of the bank rate while benefiting the bankers, places a crushing burden on councils attempting to try and cope with the needs of housing their constituents.

Now for this year Wilson is prescribing more of the same medicine. At a time when the steel industry is complacently expecting a drop of something like 2 million tons in production, and other industries are similarly placed, Wilson declared in his speech of January 10th: “In the months that lie ahead, we shall see whether the British people are prepared to assert the qualities that are needed—qualities of effort and ingenuity, of restraint and self-discipline, of unselfishness, of willingness to surrender selfish sectional interest to the call of a greater national and social interest.” There would be no let up in the credit squeeze. Then he added for good measure: “Outmoded relics (so called restrictive practices) of trade depression must be attacked where they hold back production”.

Stick and carrot

Apart from the stick, carrots were also to be offered—“new proposals for stimulating industrial investment and regional development.”

Such a speech could as easily have come from Churchill or Macmillan had they been in power now. For what is the meaning of the speech? For the workers, “sacrifices” of cherished rights fought for and won over generations of struggle by the trade union and Labour movement. That is the meaning of the attempt to restrict wage increases by the prices and incomes board. The railwaymen have just had a taste of the bitter dish that is being cooked up for them by the government, to the applause of the financiers and industrialists. For the capitalists there is to be a new programme of lavish grants to try and persuade them to “modernise” their equipment. For the workers more effort, for the capitalists more inducements. Quite a pleasant division of tasks…if one is a capitalist!

Prices rise

Meanwhile the prices and incomes board has failed entirely in the attempt to keep down prices. Even the price of bread has risen by 1 d. for a large loaf. This will hit the poorest and most wretched part of the population, to whom bread is a staple of their diet. The Financial Times and other journals of finance-capital are all demanding further drastic action to keep down wages. In its issue of 31st December last the above-mentioned journal demanded that “…all wage settlements (should be) subject to approval by a wages court which would take the national interest fully into account.”

Wilson’s principle that all “sectional interests” must be cast aside thus apparently has their warm support, when it is applied, as intended, to the trade unions and the working class.

Monopolies benefit

The measures announced by Wilson benefit businessmen, especially the monopolies and big business. Yet see how these gentlemen react at the merest suggestion of an encroachment on their entrenched interests and privileges. Mr. John Davies, secretary of the Confederation of British Industry, declared at the suggestion that the nationalised industries might be allowed to extend their field of operation:

“Private industry regarded the extension of nationalised industries ‘manufacturing powers’ with implacable hostility…

“Certainly in this area of nationalisation there are the seeds of what might be a dire conflict and thereby (the government) forego the cooperation which it has so far enjoyed and to which any government is entitled providing it does not seek to damage with intent the industrial fabric of the country.”

“…The issue of steel nationalisation might have been an occasion for a major confrontation, but that was withdrawn.” (Speech at luncheon of the London and South Eastern Regional Council of the Confederation of British Industry on 18th November, 1965)

Here you have the issue glaringly exposed. Wilson is demanding that the workers strain every nerve, etc., in the “national interest” which the capitalists interpret as the strengthening of capitalism and the further enrichment of themselves. Anything which touches the sacred vested interests of capitalism is against the “industrial fabric” i.e. capitalist ownership of industry and thus against the national interest!

Class society

By deliberately playing down the class basis of society, the Labour leaders are deceiving the people, and being used by big business for precisely their “selfish sectional interests”.

Yet even from a capitalist point of view the holding down of wages does not serve the interest of modernisation but on the contrary delays and prevents it. Even with the lavish subsidies of the state, 20 percent grants in cash, 40 percent in regional development areas, and the tax concessions in addition, the employers will only undertake modernisation when it promises bigger profits for themselves. That is the only “national interest” that they understand.

Limitation [of] wages

Even the Financial Times admitted the correctness of the argument of Jack Jones, a leader of the T&GWU in opposition to the limitation of wages implicit in the prices and incomes board when its Midland correspondent pointed out.

This sort of “socialism” being advocated by Wilson will undoubtedly gain the whole-hearted support of the capitalists and their press. Their only criticism is that they are doubtful whether Wilson can deliver the goods.

When the workers see that the measures announced will only increase still further the record profits of the capitalists while not solving in any way the fundamental problems of the economy, they will demand an accounting from their leaders. There is nothing remotely resembling “socialism” in these measures, hardly anything that the bankers and the Confederation of British Industry can object to. It will increase the power of capital over Labour without solving anything.

Yet Britain is still a country of enormous wealth. What is required is not legislation restricting the rights of the trade unions and the workers, and limiting wage increases but limiting the power of the capitalists. That is the root of the problem. Let the government mobilise the mighty power of the trade union, co-op and Labour organisations. Let them conduct a campaign for an Enabling Bill to take over the 400 monopolies, the insurance companies and the private banks, which own and control the greater part of the wealth. Then organising production on the basis of a democratic plan of production involving the workers and all sections of the population, except the tiny handful of exploiters, they can solve the problems of production for the benefit of the people and not for the benefit of the exploiters. Production would increase not the miserable 2 percent forecast but 12 and even 20 percent a year.