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International Socialism, Spring 1968


Editorial 1

The Cuts


From International Socialism, No.32, Spring 1968, pp.1-2.
Transcribed & marked up by Einde O’Callaghan for ETOL.


The paths of Britain’s retreat from classical colonialism and Labour’s retreat from reformism and Social Democracy converged on 16 January when the Government announced its package of measures to make devaluation ‘work.’ The successive measures are all directed at the same aim: to cut back the real income of the majority of the population. The earlier cuts, devaluation, the 16 January cuts, and the expected heavy increases in taxation in the coming budget, are all designed to cheapen British capitalism’s output at the expense of the British population – British workers thus pay to force down foreign prices, and so foreign wages. On current calculations, as we go to press, the Treasury happily envisages that profits and dividends should rise by 15-20 per cent this year, but is worried that, despite the cuts, consumption will still increase by 4½-5½ per cent. If only the Chancellor would impose £500 million in new taxation in the budget, there could be a 2 per cent fall in personal living standards – ‘Such an event,’ The Times (22 February) marvels, ‘would be quite unparalleled and might have incalculable political consequences.’ Perhaps it would be too tough and too indiscriminate in its effect, so that a more ‘flexible’ instrument is possibly appropriate. Thus, the incomes policy and a statutory wages freeze once more become the centre of the battle.

Ironically, defence policy East of Suez has been a casualty in the January measures. It had long been apparent that, in terms of British capitalism’s direct needs, the cost was exorbitant, and it was pre-eminently US foreign policy which demanded the British contribution. The change does not affect the basic American strategy of using Britain as America’s Trojan Horse within the gates of Europe, and as general public relations man wherever needed. But the actual measures themselves highlight the weakness of the dollar, and must be seen in relation to US measures to strengthen its own currency. The British and American measures together further intensify the sharpening battle for world markets that is going on. Apart from the measures of protection and economic autarchy this imposes on all trading countries, even more pressure is brought to bear to lower wages in all such countries so that the same or a larger share of a dwindling increase in world trade can be secured. Neither the Europeans nor the Japanese will permit the British or the Americans to rob them of any competitive advantage without comparable retaliation. The stage is set for a continued growth in economic warfare, in the instability of the nation-State system, each regime seeking to compensate its losses abroad by depressing its domestic standard of living. Backing Britain is only the candy floss, but it is indicative.

But in the immediate perspective, it is the effect of the cuts in welfare (imposing prescription charges was a piece of gratuitous nastiness for the foreign banking audience) and consumer spending, wages policy and the drive for productivity bargains, which shape the immediate perspective. For a long period after the second World War, a period of general expansion in the economy, the fragmentation of the working class did not prevent continuous, although fluctuating and unevenly spread, increases in wages. The fragmentation of the working class paralleled a fragmentation in the capitalist class – employers were making too much to unite against labour, and paid increases rather than be defeated by other employers in the scramble of the market. However, over the last few years, employers, strongly assisted by State intervention in the form of Ray Gunter, the Prices and Incomes Board and incomes policy generally, have begun to generalise their attack on labour, to restore a sense of class solidarity. The Myton’s dispute accurately reflected the new combination of employers, assisted by the State with Lord Cameron’s Commission and several hundred policemen, and by the unions – the cost of the dispute to the employers concerned was immense, but they were compelled to pay it as an act of solidarity to the class of which they are members. But for workers, the fragmentation of the past has not been overcome, and this is a source of grave weakness in the present situation. This weakness, isolation, is the first cause for the defeats seen recently in one sector after another. Militants still fight, but increasingly each fight is waged by the other side as a class battle – the force of the ruling class is brought to bear on one isolated group of workers.

The fragmentation is a crisis of leadership among the rank and file, for it is the leadership which should generalise the struggle, should link the fragments, and connect the industrial and the political battle. Even in the ruling class, it required the State to enforce and initiate the moves to co-ordination, whose results are now only too apparent. The trade-union leadership once played the role, but has now, with some exceptions, both joined the other side and lost contact with the mass of the union membership. The attack now being waged by the State can only be met with an equally comprehensive resistance. The attack covers all the elements of livelihood of the working class – rents, prices, wages, welfare benefits – and seeks to reform the institutional defences of workers by productivity bargaining, reform of the unions and so on. For socialists, it is vitally urgent that the resistance is mobilised, that rank-and-file organisation begins to reach out towards wider co-ordination, to link fragmentary struggles and connect the industrial and the political.

Out of this struggle, a new political-industrial leadership has to be crystallised, a new labour movement created, and a new strategy for working-class power forged.

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