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Henry Judd

Behind the British Social Crisis

Reviewing the Empire’s Decline

(October 1947)

From New International, Vol.13 No.8, October 1947, pp.232-234.
Transcribed & marked up by Einde O’Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL).

“There is really very little room for doubt that the aggregate output of the British community today is from 10 to 20 per cent higher in volume than it was in 1938.” (The Economist, August 2, 1947)

The word “crisis” is employed in many contexts and by most quarters in describing the present economic and social difficulties of Great Britain. There can be no objection to the use of this word, certainly, but the sense in which it is used must be carefully qualified. If, by England’s crisis, is meant the beginnings of or the approach to a full-fledged revolutionary crisis, a period in which the class struggle within the country will be lifted to intense heights and great political events will occur, then the word is completely misused and England’s situation misjudged. The Labor Government, despite its vacillations and weaknesses, is still firm and stable. The masses of workers and, to a lesser extent, the middle class, still give it their support. The recent Liverpool by-election for an MP post, easily captured by the Labor Party although at a reduced majority, indicates no basic switches in political tendencies. The average Englishman still thinks the Tory Party has no program or positive counter-plan. There is no serious development of a fascist movement to be seen.

Nor can the word “critical” be employed with respect to the living conditions of today. In general, England stands between America and France so far as its material standards are concerned. It is, of course, far above Germany. Everybody is working (unemployment is the lowest in England’s history); there is sufficient food for all, even though it is monotonous and of poor nutritional quality; all homes will be warmed throughout most of the winter; and general health and social services are admittedly at peak levels. Furthermore, England is producing and, above all in contrast with Germany and the continent, she is a going economic unit.

Nature of the Crisis

Yet it is correct to employ the word “crisis,” provided we explain in what sense we mean this. It is a crisis that stems from England’s completely reversed position with relation to the world; it is a permanent and lasting crisis from which England, as it is today organized, can never shake itself loose; it is a crisis of perspective that will determine the development, in the future, of the islands and their 40 million people. It is therefore a type of crisis whose effects work slowly, within the body of the nation, and whose results are—at first—more social and psychological than political and revolutionary. This slow-working crisis is quite observable in England today and definitely takes on objective forms. Some of them are the following:

  1. A widespread and prevalent mood of discouragement, apathy and lack of energetic optimism as to the future possibility of their nation exists among all classes and strata of the English. The outstanding objective indication of this mood is the movement for immigration to the Dominions and America, the desire for which has been expressed—it is estimated—by between three and four million Britons of all classes! (Together with their families, this could amount to 25 per cent of the United Kingdom’s total population.)
  2. The apparent helplessness and decay of the English ruling class, now utterly dependent upon the Labor Government for the retention of its position and privileges; a decay most explicitly expressed in the incapacity of Churchill and his Tory Party to capitalize on the Labor Government’s blunders and to develop a counter-program. There is nothing the Tory Party dreads more than the responsibility of political power today, given the present context of economics and international relations.
  3. A reported, and well-founded, drying up in inventive powers, originality, cultural contributions, etc., among the intellectuals and other elements in the population.
  4. The rapid and expanding bureaucratization of all forms of social and economic life, under the Labor Government’s initiative. The permanent intervention of the government in economic life as the state capitalist regulative agency is, of course, to be expected and arises out of the crisis itself. Far more significant is the bureaucratization of the labor movement and its organs. As the September, 1947, Socialist Appeal so accurately expresses it, the just-concluded Trade Union Congress: “... made it clear that since the advent of the Labour Government, the trade union movement has become even more immersed with the employers”, their organizations, and the government machine, to the detriment of any section of the workers forced to defend their conditions by struggle, and looking to the trade union organizations to aid them.

“From the Nationalised Boards and the working parties, down to Regional, District and Factory Production Committees and other organizations covering economic life and social services, a complicated web of collaboration between employers, government, and trade union representatives has been created.

“It is evident from the General Council Report that its main field of work lies in discussions, proposals, joint consultations with employers and government on the questions of exports, imports, production and the utilisation of the labour force.”

Now, the source of this deep and fundamental crisis in England’s life is a well known fact. It lies in the complete reversal of the nation’s world position over the past ten years. All those prior tendencies, so long discerned, have now become realities and brute facts. Everyone grasps this, but its consequences are only now coming home to roost upon the nation.

What Happened to Great Britain?

From the position of the mighty hub and controlling factor in a great world empire, the island kingdom has descended to that of just another major capitalist power, hemmed in by rivals and hampered by severe internal difficulties. Or, expressed in its simplest form, Great Britain’s role as a great creditor nation of the world has been reversed to that of a bankrupt nation, victimized by a world debt that mounts regularly. Rarely has history known such a startling, complete reversal over such a brief period.

The crisis of England, proclaim its leaders, revolves around the unbalance between imports and exports. There is at the present moment, declares Attlee, an adverse balance of trade working against England’s favor to the amount of $2,400,000,000 per year. The problem is, then, how to reduce this unbalance to zero and, if possible, create a favorable balance.

True as this posing of the crisis may be, it is nevertheless a deceitful concealment of the real nature of the matter. It throws no light on why the present unbalance exists (and is growing), nor does it mention the fact, well known to be sure, that England has never had, in simple export-import trade balancing, anything but an adverse, unfavorable balance of trade! The cause of today’s harsh unbalance lies not so much in a decline in Britain’s trade with the world, but in the catastrophic decline of the so-called invisible items of previous years — that is, those sources of revenue flowing from Britain’s position as a world imperialist power (mother-land of the Empire) which enabled her to more than overcome the low shown on the simple export-import balance sheet. Dividends from world investments, profits from the shipping and financing, accumulated wealth from colonial ownership and overseeship — such were the decisive items (invisible!) that characterized Britain’s former position. In the reversal of roles, this is what has largely gone by the board.

The factors behind this almost annihilation of the invisible items are familiar. The great losses in wealth and capital sustained during the war; the powerful emergence of American imperialism both as forecloser of British investments and market revival; the growth of both dominion and colonial capitalist classes (particularly in India) who came to call the tune; the general disturbance of the world’s trade. But the main point to grasp is that this is a permanent condition. In line with their analysis of the situation, the Labor Government proposes the only solution possible for it, given its character. Export, export, export. The shrill call for increased exports is heard on all sides. Yet this proposed program, too, conceals the real nature of the problem.

“We have a crisis in dollar and sterling unbalance,” says Sir Stafford Cripps, “which only more exports can cure.”

Yet today, allowing for price changes, exports are 105 per cent of the 1938 level, and mounting. Cripps demands—and will probably get—140 per cent of 1938 by the end of next year; he demands — and will probably get—160 per cent by the end of 1949. Yet we unhesitatingly venture to predict that even if England were to double its 1938 export trade there would be, at best, only the slightest alleviation in the situation.

The Drive for Exports

For the drive of Britain for increased exports can in no way be confused with the export drives of, let us say, young capitalist nations anxious to increase their home store of accumulated capital; nor can it be compared with the export drives of maturing, expanding capitalist nations (as, for example, the United States) which must make use of their superfluity of capital. Britain’s export drive comes out of its desperation, not its health; out of the nation’s fatal decline, not growth.

The basic trend then of the British export program is guided by the mere need to live, to keep going, to continue. Its aim is to get food, sustenance and the raw materials required to—export! The whole program must thus be seen as part of a vicious and impossible cycle — forty million English work to produce exports with which to procure dollars and sterling with which to purchase food and raw materials with which to work to produce exports, etc., etc. This, then, is the final trap into which the British people have been led by two hundred years of imperialism. The fantastic trend of British economy is thus toward the creation of an enclosed, self-sustaining (at a dull, low level) economy of survival and austerity.

Let us prove this contention. The entire economy of England is now geared to the export program, expressed in various terms. “Cutting down the unbalance of trade”; “resolving the dollar and sterling shortage”; “balancing exports with imports.” Production levels for export—known as industrial targets, and constituting a crude and primitive sort of “planned economy”—have been set by the government, which exercises control over imports, allocation of materials and labor to industry, and direction of exports. The Labor Government, in accord with its export program, is prepared to (and can) bring about shifts in industrial production, favoring those plants whose products will sell abroad. The most clear-cut expressions of British state capitalist development lie in the state’s regulation of the complex export-import relationship.

To close this gap, conceived as the two blades of a scissors which must be brought together, the government brings pressure to bear upon the separate blades—decrease in imports, increase in exports. It is the application of these separate, yet related, pressures, together with the resistance that Britain’s workers will offer to them, that will determine the political and economic evolution of the country over the next few years.

What Is an “Austere” Economy?

Pressure on the import angle is aimed at creating an “austere” economy for the masses; an economy of work and want. Import cuts amounting to $700 million have been ordered. This will affect largely food and meat imports, and must mean additional cuts in the basic rations (for example, each Englishman is now limited to a weekly meat ration of 20 cents). This is the largest saving so far imposed. An estimated $213 million is to be saved by the ban on foreign travel (the closing-in of English economy will also keep the Englishman penned up in his island), and the end of the gasoline ration for pleasure travel. If the situation worsens, there will be other cuts (coal for heating, gas, electricity, etc.).

From a social point of view, the most significant shift in imports will be the increase in raw materials imported at the expense of food and finished commodities. Of the planned $6,800,000,000 imports from mid-1947 to mid-1948, that consisting of raw materials will be largely utilized for the export drive. This is intimately linked with the cut of $800 million proposed by Cripps in yearly capital goods- outlay within England itself. The phrase, capital goods outlay, refers of course to such budget items as housing, building of new schools, hospitals and various public institutions, as well as the equipping of English industry with new machinery. This phase of the program is thus the sharpest, most direct drive upon the living standards of the people.

What of the export program? The above measures will not even bring the two tips of the scissors halfway together; the unfavorable balance draining away England’s productivity is not even half closed up. We have already indicated the proposed answer—Cripps’ latest and still higher export targets. The goal is to export $125,000,000 more each month, to attain, in theory, the essential balance.

This demands a greater export in capital goods (machinery, semi-finished steel and building materials, etc.). It may, and probably will, demand the mobilization and forced direction of labor into certain industries, with a fixing of the worker to his job. And, as the austereness of home economy strikes deeper, a system of differential rationing, according to work performed, will be installed. Such is, in general outline, the prospect before Great Britain in its struggle for survival. A turning in of the country upon itself, with the autarchization of its economic institutions and the bureaucratization of its social institutions and politics.

Let us grant the complete success of the projected program. The scissors gap is closed, with the aid of the remaining invisible items; an exact balance of exports and imports is achieved. In passing, we consider this most improbable of realization, but it does not affect our conclusions. What, then, is England’s situation?

Duration of the balance over any period of time would mean, in effect, continuation of precisely the same economic conditions and measures that had brought it about. That is, at best, England — by its economy of austerity—would be making its way, surviving. Furthermore, it is excluded that England can lift itself above this balance; i.e., reach a favorable trade balance necessary for prosperity, since that source of revenue known as invisible items can hardly be expected to reverse its downward trend. All things may happen in out world, but the resurrection of the British Empire is among the category of least likely events. It is this prognosis that stamps our analysis with permanency. Let alone the fact that, under the best circumstances, the optimistically grounded Cripps program can hardly be expected to develop smoothly in the world of today.

Self-evident is the fact that the masses of English workers shall be expected to bear the brunt of the criminal consequences of long centuries of policy pursued by Britain’s imperial ruling class. The story of the coal miners and their industry, after one year of nationalization, clearly forms a pre-pattern for the future of the English working class. The coal nationalization can now be seen in its true perspective—the taking over of a sick industry by the state, at the expense of the people, as a part of its autarchy program and with the included objective of intensifying the economic exploitation of its laborers. How far these powerful and inevitable tendencies proceed will depend upon the readability of the English working class and its capacity to gain the support of the nation’s middle class. Otherwise, the power and weight of the top-heavy state apparatus will grow without halt. In this sense, of course, England’s permanent crisis takes its place in the now familiar world phenomenon of developing statification.

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