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Andrew Glyn

Labour Activist and the Manifesto

(March 1979)

From Militant, No. 450, 6 April 1979, p. 7.
Originally published in New Statesman, 16 March 1979.
Transcribed by Iain Dalton.
Marked up by Einde O’Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL).

Recently, Labour Activist, produced by the Labour Co-ordinating Group, published its criticisms of Labour’s draft Election Manifesto and offered its own alternative. Andrew Glyn, in an article first published in the New Statesman (16 March), takes up their arguments.

Labour Activist quite correctly criticises the Labour Party’s draft manifesto for not providing a ‘socialist analysis of the international crisis and of Britain’s problems’ and for ‘failing to analyse the obstacle to democracy, socialism and prosperity formed by the class system, the structure of government and management.’

But does its own Manifesto for a socialist Britain do better?

LA’s own analysis of the crisis in the world economy is hopelessly inadequate. It says that the recession has been caused by ‘the mistaken response (my emphasis) of governments to the end of the post-war boom and the breakdown in western financial and trading arrangements.’

But ‘mistaken’ in whose terms? High unemployment is intended to hold down wages and pave the way for rationalisation of industry. Capitalists throughout the world fear that any attempt at reflation and expansion would soon collapse amidst accelerating inflation as happened during the last attempt at expansion in 1972–73.

With profitability even lower than it was then, with memories of rapid inflation fresh and the prospect of booming markets fading, it is probable that the collapse would be even quicker this time round. It is ludicrous to say, as LA does, that ‘as each country in turn faces the threat or reality of a currency crisis, its government deflates in order to protect itself against speculation.’

But what about Germany and Japan, whose currencies are strong? Calling the world slump ‘the moral and practical responsibility of western industrialised countries’ is quite absurd when the interests of the capitalist class and not ‘mistakes’ dictate the policies now being followed.

LA says that the next Labour government must ‘re-assert control over the British economy lost as a consequence of the growth of multinational banking and trade and our entry into the EEC.’ But did the Labour government really have that much more control in 1964, before Britain was in the EEC and when internationalisation of the British economy was less advanced? Or in 1931?

Not at all. The ‘lack of control’ of the Labour government reflects the fact that the overwhelming proportion of the means of production and the financial system are under the control of the capitalist class. Blaming internationalisation is looking to a symptom rather than the cause.

In dealing with import controls, LA brushes away the objection that they would mean trade retaliation by arguing that ‘we cannot reasonably be expected to do more than allow imports and exports as a whole to rise together.’

But there is nothing ‘reasonable’ about competition in world markets. If exporting industries in the advanced capitalist countries find themselves deprived of full access to a rapidly growing market in the UK they will exert maximum pressure for retaliation, which would lead to jobs lost in UK export industries.

Saying imports were not below what they would have been anyway will cut no ice with workers abroad who would see import controls as directed against them and will join their bosses in demanding retaliatory action. This is not to support free trade: neither capitalist protection nor capitalist free trade offers a solution.

LA says quite correctly that ‘Full employment should be named as the first priority of the next Labour government,’ and calls for ‘an explicit plan for reflation and the return to full employment including increases of public spending of £3,000 million a year.’

Such increases would certainly make possible many of the improvements in health, welfare, etc., which the draft manifesto calls for. But how would they be financed? LA says ‘not by tax increases but largely by saving on unemployment benefit and higher tax yields from economic growth.’

But this would not cover all the extra expenditure. There is no explanation of how the financial institutions could be forced to finance a greater level of public borrowing.

The Labour Party’s draft manifesto itself shamefully waters down the 1977 Conference demand for nationalisation of the banks and major insurance companies into a pathetic scheme to unite the Giro and National Savings Bank and to give ‘serious consideration as to how best to create a further substantial public stake.’

LA does not comment on this and so presumably does not accept the necessity of nationalisation of the finance sector to free the government from the dictates of the City.

LA also ignores the inflation which would result from reflation, as business tried to restore profitability – still less than one third of the level of the early ’Sixties. Does LA, like some other proponents of the Alternative Economic Strategy, want stringent price controls? If so, how far could such an expansion go without seizing up from lack of profitability, given that the overwhelming proportion of industry would be in private hands and thus operating according to the capitalist criterion of profitability?

Or does LA propose an incomes policy to guarantee profitable, and thus capitalistically sustainable, expansion? Given capitalism’s need to increase profitability, an attempt to expand on a capitalist basis can only mean holding back the growth of real wages. LA fails to analyse such contradictions of capitalist reflation.

The draft Labour Party manifesto calls for £1,000 million a year for the NEB and specifically for ‘a major public stake in pharmaceuticals, building materials and construction.’ The idea of a commitment to a 10-year housing plan has been dropped; buttressed by a nationalisation of the industries concerned, including finance, this could have been the basis of a real socialist plan for housing.

LA itself has no more specific programme of nationalisation than the draft, just calling for the NEB to have the ‘power to acquire big companies wherever necessary for reindustrialisation.’ LA puts much weight on forcing businessmen in ‘key manufacturing industries’ to implement the government’s ‘investment, production and employment targets’ through compulsory planning agreements.

But it would be absurd to imagine that businessmen will give up their most basic prerogative – control over where they accumulate capital. The authority of a parliamentary majority will never make the business and financial community accept the directives of a Labour government.

The labour movement already has experience of their scornful treatment of planning agreements. Bob Cryer, one of LA’s steering committee, said recently in the House of Commons: ‘In view of the amounts of aid to industry which this government has been giving… it seems that industry could develop a more co-operative attitude to planning agreements.’ But LA is silent on how to ensure a ‘more co-operative attitude’.

Only the nationalisation of the 200 or so companies which control 60 per cent or more of the assets in the UK would be the indispensable minimum for securing real control over, and thus the ability to plan, the economy.

This should be on the basis not only of ‘workers’ control at the plant level’ as LA advocates; but also with workers’ management of the industries carried out by workers from the unions in the industry concerned, from the TUC to represent other workers’ interests as consumers, and with government representatives to ensure that the plans of the individual industry and enterprise mesh in with the needs of society as a whole.

LA’s suggestion of ‘joint worker-management and services’ is just a recipe for workers taking responsibility for management decisions.

Rather than LA’s call for a wealth tax, which, though obviously a welcome measure, would never affect the huge holdings of shares which give control over British business, nationalisation compensation should be on the basis of proven need.

Neither the Labour Party draft, nor the LA manifesto adds up to an adequate basis on which to secure real control over the economy. I believe that the absolutely necessary advances of a decent minimum wage, a real expansion of housebuilding, full employment and so on can only be secured and guaranteed by a socialist plan of production based on the far-reaching socialist programme I have just outlined.

[The Labour Co-ordinating Committee is supported, among others, by Michael Meacher, Brian Sedgemore, Stuart Holland, Audrey Wise, Jeff Rooker, and Francis Morrell.]

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