Communist Party of Britain

Britain’s Road to Socialism (2001)


Chapter II

The Crisis in Britain

 

Britain’s problems today reflect the general problems of world imperialism, and at the same time exhibit specific features arising from Britain’s parasitic colonial past.

As the first industrial capitalist power, Britain was once the “workshop of the world.” It dominated world trade and commerce, controlling the largest colonial empire in history. Up to the First World War, London was the financial capital of the world and the pound was monarch of the international monetary system.

All that has changed. By the beginning of the 20th century, new capitalist nations including France and Germany—but especially the USA—were challenging Britain for supremacy. Since 1945, the peoples of the colonies have fought for, and mostly achieved, political independence leading to the collapse of the British Empire.

The need for a complete break with past imperialist policies had become urgent but, instead, successive Tory and Labour governments continued with them.

Central to this was the effort to maintain the international role of the pound and of Britain as a major financial centre. British monopolies carried on investing huge resources abroad at the expense of investment at home.

Colonial wars and repression continued after the Second World War, while neo-colonial policies undermined the efforts of former colonies to achieve real independence. Racist and oppressive regimes were backed in South Africa and in other parts of the world.

Britain played the role of junior partner in the USA’s efforts to hold back national liberation movements and to direct the Cold War against socialism. This meant a gigantic waste of resources on bases abroad and armaments.

Nevertheless, advances in living standards could still be won. The immediate post-war situation favoured a sustained expansion in the world economy, enabling Britain to enjoy a period of growth.

Although Britain’s economy compared unfavourably with others in terms of investment, productivity and trading performance, significant concessions were yielded to working people in terms of jobs, wages and other material and social benefits.

The creation and expansion of the Welfare State from the mid-1940s epitomise the gains that could be made.

The situation altered towards the end of the 1960s, when the post-war expansion began to end. The chronic weaknesses of the British economy were sharply exposed as the world capitalist economy went into crisis.

For the British ruling class, it became a particularly urgent task to place the burden of the crisis upon the shoulders of working people, even to the extent of clawing back previous concessions.

The Heath Tory government was the first to attempt a complete break with the Keynesian-style class-collaboration policies pursued by post-war Labour and Tory administrations.

From the moment of its election in June 1970, it opted for open confrontation with the trades unions. But the Heath government suffered defeat after defeat at the hands of the working class, which was too united, too strong and too confident to be beaten in direct confrontation.

When the Labour Party was returned to office in February 1974, many thought that the magnificent struggles of the miners, the dockers, the power workers and the whole working class might be rewarded.

Labour’s election manifesto had promised to bring about “a fundamental and irreversible shift in the balance of power and wealth in favour of working people and their families.” But instead, there was a further shift in the balance of power and wealth in favour of the capitalist class.

The class objectives of Labour’s right-wing leadership were the same as those of Heath and the Tories. The difference was that where Heath had failed to achieve these objectives through open confrontation with the labour movement, the Wilson and Callaghan Labour governments succeeded by enlisting the collaboration of most trade union leaders.

In September 1974, the TUC endorsed the Social Contract, which supposedly offered the unions a partnership with government in formulating economic and social policy. But its real purpose was to get the TUC itself to police a policy of wage restraint.

The results of the Social Contract were catastrophic for the working class. The Labour government—operating behind the facade of an IMF diktat—slashed state spending on industry, infrastructure, public sector wages and social services. As the position of working people steadily worsened, and their initial confidence and expectations turned into disillusionment and disgust, the ground was inexorably prepared for the election of the Thatcher Tory government in 1979.

Tory Strategy in the 1980s and 1990s

The strategic objectives of the Tories under Thatcher and Major were two-fold: to reduce the incomes and living standards of the working class in order to restore and consolidate the profit base of the capitalist monopolies and, at the same time, to suppress democratic rights in order to break any working class resistance.

Towards these objectives, Tory legislation facilitated the deep and direct penetration of monopoly capital into many areas of social life and activity, including education, housing, culture, sport and leisure.

These Tory governments sought to hide their real class aims behind an elaborate propaganda campaign extolling the virtues of private enterprise and the market economy, and the individual choices and freedoms that supposedly go with them. But harsh realities in Britain soon exposed the hollowness of these claims.

The Tories cut public spending and investment, sold off vital public assets and nationalised industries at knock-down prices to private monopolies, encouraged the exodus of capital and provoked interest- and exchange-rate instability.

These policies accelerated the decline of Britain’s economy and led to massive redundancies, inflation and balance of payments crises.

British-based monopolies and financial institutions made enormous profits, but many smaller firms collapsed and whole communities were devastated by factory and pit closures. Such new developments that did occur in those areas were carried out in the interests of the big property, leisure and retailing companies.

Tory governments created and used mass unemployment as a weapon to debilitate the organised trade union movement and to undermine its confidence and morale.

Threatened loss of benefits forced many “job seekers” into working long hours for low pay, while increased job insecurity enabled employers to drive down wages and intensify the work process.

Weakened through years of underfunding, the Welfare State faced the prospect of outright abolition. The fall in the real value of pensions and benefits, together with increased indirect taxation and cuts in the “social wage”—the National Health Service, state education, council housing and public transport—contributed to a significant reduction in living standards for the majority of the population.

The worst affected were women, young people, pensioners, ethnic minorities, the unemployed and single parent families—those sectors of the working class who are least well-organised and therefore least able to defend their interests.

Indeed, the discrimination experienced by women and black people means that they are not only exploited as workers, but also oppressed because of their gender or race.

Women’s employment increased throughout the period of Tory rule but predominantly into part-time, low-skilled and low-paid jobs, and the second-class status of both women and black people made them particularly vulnerable to cuts in benefits and social services.

The savagery of the Tories’ attack demonstrated their intention to secure an irreversible redistribution of wealth and power towards the capitalist class. Central to achieving this were the drastic constraints imposed on the trades unions.

Long standing common law immunities were removed, solidarity strikes and secondary picketing were outlawed, ballots were imposed on every conceivable occasion and—even where ballots were conducted—employers were given powers to sack strikers with impunity. Crucially, the TUC and the unions failed to maintain a united, militant front in the face of this onslaught.

A parallel assault took place on representative local democracy, where the labour movement had secured significant representation. Measures such as rate-capping, “local management” of schools, council house sales, privatisation of municipal transport, abolition of the Greater London Council and the metropolitan authorities, and the introduction of the Poll Tax and then the Council Tax, stripped local authorities of significant powers.

The centralisation of power in London denied the peoples of Scotland and Wales any real means to influence or determine policies affecting their national interests. At the same time, the sovereign rights of all the British peoples were curtailed by the transfer of more of the legislative powers of the Westminster parliament to the unelected European Commission in Brussels.

This assault by itself represented a serious threat to democracy.

But the attack took place on every front, using every instrument of state power including the police, the judiciary, the secret services, the civil service and the mass media.

The Criminal Justice Act gave the police and the courts a wider range of powers to harass, intimidate and convict people. An ideological offensive was launched to create a climate of fear, insecurity, intolerance and personal greed.

Sexist and other divisive attitudes were encouraged, aimed at women, lesbians and gay men. Racist immigration and nationality laws not only denied rights to black people, but also led to escalating levels of racist violence and other oppressive behaviour.

Of all those who suffered as a result of the Tories’ suppression of democratic rights and civil liberties, none did so more than the people of Northern Ireland.

Colonised by England over 800 years ago, Ireland had been partitioned in 1922 after fighting a people’s war for national independence. A puppet state was set up in the north to perpetuate British imperialist domination.

But the continuing struggle for national unification, and the growth of the civil rights movement in Northern Ireland, led eventually to the collapse of the Stormont regime in 1972 and its replacement by direct British rule.

In 1969, British troops had been sent into Northern Ireland ostensibly to keep the peace. Instead, the army was consistently used to intimidate the nationalist community and to suppress the republican forces seeking a united independent Ireland.

It has been responsible for mass arrests, torture, killings and the military occupation of working class nationalist areas. No-jury Diplock courts, assassinations and other forms of state violence became the norm.

Northern Ireland also played the role of “guinea pig” for British state repression, as methods first applied and tested there were subsequently transferred to Britain. Successive Labour leaders colluded with the Tories to ensure continued imperialist intervention in Ireland.

The Tories’ approach towards Ireland symbolised the continuity between their reactionary domestic policies and their reactionary foreign policy. Together with the US government, the British state stood—as it does today—at the forefront of the struggle against world progress and to maintain the grip of imperialism.

The Tory governments of Thatcher and Major provided every form of assistance to reactionary regimes around the world, most notoriously to apartheid South Africa and the Pinochet dictatorship in Chile.

But the fact that Britain was no longer a leading world military power, with bases across the globe, meant that the ruling class had to rely increasingly on US military strength to protect the parasitical, neo-colonial interests of British TNCs overseas.

This factor, more than any other, accounted for slavish Tory support for US imperialist aggression in Central and Latin America, for US policy in the Middle East, and for US arms expansion since the early 1980s including the infamous “Star Wars” project.

This is also the reason why British governments helped to reinforce US domination of the NATO military alliance, while also playing host to 130 US military installations.

These made—and still make—Britain the main centre for ‘forward-based’ US strategic nuclear weapons and, therefore, a main target for retaliation in the event of nuclear conflict.

But Britain’s relationship with the USA remains a complex one. Although one side of British imperialist interests dictates the necessity for an alliance with US imperialism, another side of those interests dictates the need for closer unity with the West European imperialist powers grouped inside the European Union.

British monopoly capital was originally opposed to the formation of the European Economic Community in the 1950s because, at that time, it ran counter to Britain’s global interests. However, British imperialism has since come to play a key role in the EU, seeing it as a necessary framework for protecting its interests, in common with those of other Western European imperialist interests, against the intensifying competitive threat posed by US and Japanese TNCs.

The British ruling class also sees the European Union as a powerful mechanism to undermine organised working class struggle—while facilitating the collective neo-colonialist exploitation of former European colonies, particularly in Africa.

The Thatcher and Major governments attempted to block certain aspects of Western European centralisation, although they supported the drive to create a Single European Market by 1992.

Their opposition to complete centralisation did not, however, spring from any desire to protect national sovereignty and democracy on behalf of the peoples of Britain; rather, it reflected Tory efforts to balance and reconcile British state-monopoly capitalism’s EU involvement with its so-called ‘special relationship’ with US imperialism.

At the same time, of course, British imperialism has its own interests to pursue as a major economic and military power on its own account. Despite Thatcher’s populist assertions about defending British sovereignty, her governments signed up to numerous measures which eroded that sovereignty, including the sweeping 1987 Single European Act.

The general crisis of the world system of imperialism dictates the fundamental tasks facing the dominant section of the capitalist class in Britain as elsewhere. These tasks were common to the Heath, Wilson, Callaghan, Thatcher and Major governments alike in their role as the executive arm of Britain’s capitalist monopolies.

What distinguished the Thatcher Tory government was the consistency and uncompromising ruthlessness with which it pursued ruling class objectives, and the extent to which it fought the battle of ideas against socialism and the very concept of ‘society’ itself.

State Monopoly Capitalism Today

The election of a Labour government in 1997 opened up new opportunities for working class advance. It was a defeat of historic proportions for the Tories.

The experience of mass unemployment and popular resistance to the Poll Tax helped to galvanise public opinion in favour of Labour as the only realistic alternative.

In preparation for this outcome, Britain’s monopoly capitalists had turned to a policy of class collaboration in place of open and uncompromising confrontation with the working class.

Business leaders, media barons and top personnel in the state apparatus had been reassured by the “New” Labour leadership under Tony Blair, its support for pro-big business policies and its abolition of the socialist Clause Four in the Labour Party’s constitution. Business tycoons were promptly appointed to numerous posts in the new government.

Once in office, the Blair government made some concessions to its working class supporters. It reduced VAT on domestic fuel, restored some trades union rights and introduced a statutory national minimum wage.

But in a whole number of areas notably the economy, taxation, benefits, pensions and privatisation it essentially continued Tory pro-big business policies. In some cases, such as student tuition fees, it went much further.

Commitments to an “ethical foreign policy” were quickly abandoned. ‘New’ Labour continued Britain’s role as a junior partner to US imperialism, championed NATO aggression against Yugoslavia, enthusiastically endorsed moves towards a European military capitalist super-state, and joined the gutter press in a vicious campaign against refugees and asylum-seekers.

In preparation for European monetary union, it surrendered control over interest rates to the Bank of England.

For the peoples of Scotland and Wales and for the citizens of London, the establishment of new representative bodies by the Blair government was nonetheless a step forward.

The Communist Party had campaigned for many years for Scottish and Welsh parliaments, and for the restoration of local democracy including the Greater London Council.

The limited powers of the Welsh Assembly, Scottish Parliament and Greater London Authority, together with electoral systems which concentrated powers in the hands of party leaderships, have significantly restricted the ability of working people to use these bodies to control big business and the state bureaucracy.

Rather than widening popular democratic participation and granting genuine national rights, the Blair government’s general thrust in these areas has been to maintain the unity of the British imperialist state and to “modernise” its apparatus to make it more efficient for monopoly capitalism.

Its promotion of English Regional Assemblies, ‘reform’ of the House of Lords and the introduction of a cabinet system and directly-elected mayors in local government needs to be judged in the same light.

Significantly, all these changes are taking place at the same time as genuine democratic powers have been ceded to the European Union through the Maastricht and Amsterdam Treaties.

There is a danger that the EU’s ‘Europe of the Regions’ agenda will be used to undermine further the unity and democracy of member states, and to set working people against each other with regions’ offering lower labour costs and a ‘flexible’ workforce in order to attract inward investment from big business.

Despite the loss of democratic powers to the European Union, it remains the case that state power is exercised at British level by British finance capital, by the capitalist class and its top bureaucratic, political and military representatives. Both Tory and ‘New’ Labour governments have acted to strengthen executive power and the links with big business at every level. In this way, British state monopoly capitalism has been consolidated.

For British-based monopolies, the British state remains indispensible. It manages almost every aspect of capitalist society in Britain. It fights—often literally—to secure their access to markets and raw materials across the world. It provides these companies with the research, contracts and trained labour without which they could not survive. It bargains on their behalf within the institutions of the EU, NATO, the World Trade Organisation, etc.

The only reduction in British state power favoured by monopoly capitalism is in its democratic potential to challenge, control and roll back the prerogatives of capital.

The question of which political party forms the government within the state apparatus is an important one for the capitalist monopolies. The ruling class cannot afford to allow the demise of the Tory Party which has, hitherto, most fully and directly represented the interests of British imperialism at home and abroad.

At the same time, it is clearly in the interests of capital to make the Labour Party a totally safe and obedient servant of British state monopoly capitalism. It is not only the left which is struggling for the heart of the Labour Party, but also those sections of capital which have rejected direct class confrontation in favour of ‘social partnership’ or—to give it its proper name—class collaboration.

However, it will not be possible to make Labour wholly safe for capital in the long term unless its character as a party rooted in the organised working class is qualitatively altered. Weakening the links with the trades unions, excluding unions from the selection of Labour Party election candidates, ditching Clause Four and moving towards greater state funding of political parties are all part of this process.

But this process has not yet run its full course. The working class has made it clear that it still recognises Labour as its mass party. It will remain the mass party of the working class as long as it is based upon trade union affiliation. The implications of this reality for any strategy for socialist revolution will be considered in the following chapters.

The crisis in British society grips every sphere of life, most severely affecting the working class and oppressed sections of the people. This is in essence a crisis of state monopoly capitalism in Britain, which is in turn part of the general crisis of imperialism. That the contradictions of capitalism prevent the full and all-round development of the people, individually and collectively, is evident to all whose horizons have not been closed down by their experience of life in capitalist society.

In Britain as elsewhere, the crisis is increasingly taking the form of a crisis of democracy. Not only are civil liberties being curtailed through further security and surveillance measures, changes in the civil and criminal law, new public order and “anti-terrorism” legislation, etc.

State monopoly capitalism has also been compelled to limit and even remove the potential of elected institutions to effect economic and social change in the interests of the working class.

As this generates feelings of powerlessness and alienation, so it deepens the crisis of those parties that have long claimed to represent working class interests within capitalism, winning reforms and improvements without challenging the existence of that system itself.

The Role of Reformism

Across the whole range of domestic and international issues, the right-wing leadership of the labour movement supports policies which—although offering some minor concessions to sections of the working class—in general protect the economic and political power of the capitalist class. The leaders of the Labour Party, the TUC and most trades unions collaborate with the rule of capital instead of challenging it.

They hold out the prospect of reforms and improvements to the system of state monopoly capitalism, but would never undertake the revolutionary task of abolishing it altogether.

The predominance of class collaboration and reformism in the British labour movement has its roots in empire. The propaganda and some of the super-profits of British imperialism have been used to make some layers of the labour movement and many leaders identify their own interests with those of the capitalist class and its system.

The diversionary role of reformism explains why the ruling class and its mass media have always supported the right wing inside the labour movement, and why they have tolerated the election of reformist Labour governments despite that party’s trade union affiliations and socialist left wing.

The nature and techniques of reformism change in different phases of capitalist development, mirroring changes in ruling class strategy. Thus, for example, the benign post-war reformism of the Labour Party offered the prospect of jobs for life and ever-increasing standards of living within the context of a ‘managed’ capitalism (or even “post-capitalism”).

Reformism today is much more restrictive, seeking to condition workers to accept the ‘reality’ of the ‘flexible labour market’ which means more intensive exploitation, greater insecurity and a declining quality of life. Class collaboration and reformism are dressed up as ‘new realism’ and ‘social partnership’.

In this new period of intensified competition on a world scale—and of the protracted structural crisis of British state-monopoly capitalism—the Blair leadership represented a new right-wing trend in the Labour Party.

Openly pro-big business and anti-labour movement, it did not even seek to represent working class interests through collaboration with capital; rather it openly and consciously represented the interests of British state monopoly capitalism inside the labour movement.

But a pro-big business Labour government could never meet the main aspirations, expectations and demands of the working class. The policies of state monopoly capitalism continually threaten people’s living standards, job security, public services, the environment and peace.

This contradiction between Labour voters and such a Labour government (and Labour-run councils) will sharpen during economic recession, aggravated by the structural weaknesses of British monopoly capitalism.

In any major clash of interests, a Labour government will tend to side with the ruling class—unless massive pressure can be brought to bear by the labour movement and the mass of people, forcing a change of course at the earliest opportunity.

The experience of Britain’s post-war history is that right-wing policies eventually disillusion and alienate important sections of Labour’s natural electoral base—the working class. They fall prey to Tory populism, turn to other parties or fail to vote at all. Labour then loses office and is followed by a Tory government which is even further to the right.

The lesson should be clear. Just as the ruling class supports a strategy which protects its position, so must the working class and its allies be mobilised in support of an alternative intermediate strategy which promotes their own position.


Next: III. The Alternative Economic and Political Strategy