Friday, November 13, 2015

The false promise of Jeremy Corbyn

A transcript of the talk given at Brighton on 11 November by Howard Pilott.

 Whilst John McDonnell might put generally fermenting the overthrow of capitalism as his interest in his who’s who entry, sadly that isn’t enough to make a socialist of the man. It takes more than verbal flourishes to emancipate the working class. Rather than socialism, the talk is of working in partnership with enterprise and business to ensure economic growth [from his conference speech]. Whilst we hear promises of nationalisation of the railways and possibly even some utilities, it seems this state ownership stops short of the real productive capacity of the country. But what is this state ownership anyway? Will rail travel be free once the crony capitalists are ousted and denied their bonuses? Somehow I doubt it. The likelihood is that the railways will simply be a business run by agents of the government and probably on some form of commercial basis.

But what has Corbyn, the great herald of the new New (or Old?) Labour himself said? Well at conference he said he’d be the champion of the self employed. But in fact he didn’t say much about the economy, rather gave a kind of framing speech to provide an overall sense of his position and counter some of the accusations in the media: he loved his country; believed in open discussion; wanted more for the many not the few…etc. not much actual flesh on the bones of this advert. The idea was that John McDonnell would open that black box, for which see above. What can we charitably infer? He’ll try to tax the rich a bit more, try to make corporations pay some more tax, build some more houses and control business [certainly the utilities] a bit more. Oh, and maybe reduce tuition fees. And oh yes, there might be some quantitative easing – printing money, to you and me – to give the economy a bit of a push, as he thinks growth is a good thing.
Does any of this ring any bells with anyone? Haven’t we been herebefore? Or is this the time when they REALLY mean it: when they will REALLY make a difference? I think this brings us to two questions:

1] what makes this brand of labour significantly different to any of the
2] will what is on offer have any chance of really making a lasting

So let’s tackle question one and look at previous labour governmentswho made various promises…well there aren’t many. On RemembranceDay we remember the 10 fallen labour governments. We can choosefrom those led by Ramsey MacDonald, Clem Atlee, Harold Wilson, andTony Blair. Let’s look in sequence.

I'll call this first period cohabitation: the first Labour government under Ramsay MacDonald was a minority administration propped up by the Liberal party lasting 11 months and so it's not really surprising they didn't achieve very much. In fact it was little more than what were called the
'Weasley' (Wheatley) houses which was a program of cheap council housing. Nice but not exactly earth shattering.

Ramsey McDonald was back in office in 1929 and the administration lasted until 1931 but again another minority government. This one vacillated about Keynsian measures of public works to address largescale unemployment. However it fell apart and led to the National Government which addressed the recession by means of the type of austerity that we currently see: cutting benefits and government spending to get out of recession. This man of promise called himself
socialist and he ended up implementing these kinds of measures andwas actually expelled from the Labour Party.

The Attlee period I'm going to refer to as the land fit for heroes. This is probably regarded as the most radical and successful labour government which was elected after World War II. Their offer to the voters was to destroy the five Giants of want, squalor, disease, ignorance and unemployment.

This government was certainly committed to improving the lot of the working class. The creation of the welfare state and rebalancing the economy to address poverty were priorities. They nationalised about 20% of the economy but abandoned plans to nationalise farming. However the senior staff in the nationalised industries remained in place: it was simply a case of new owners, or
perhaps old wine in new bottles. There was no worker control on offer.

Additionally industries nationalised were mostly those that were completely run into the ground from lack of investment and the War effort. Trying to square the circle for this bankrupt economy with social aspirations was never going to work. Joining the Korean War did not help, and by 1950 prescription charges appeared: so much for free cradle to grave healthcare.

 Then there was the formation of NATO and the nuclear weapons program. It is worth noting that Atlee signed up to the terms of the Marshall plan which required a large measure of the regulation for business to be removed, which is quite similar to the way in which the IMF operates today. American capitalism seldom comes without large strings attached. But give them their due, the Attlee
government set up a variety of welfare structures that I and many of the baby boomers benefited from and endured mostly intact until the so-called sweeping away of 'socialism' under Thatcher.

I will call this section on Harold Wilson the acceptable face of capitalism.
Wilson was elected in 1964 with a minority government and a platformcalled New Britain. A second election in 1966 brought a majority administration which lasted through to 1970. I don't think anyone claims this regime was socialism although it did do major work on social reform: education, housing, social security and workers’ rights.

 But ultimately the economy faltered which lead to cuts including school milk
in secondary schools [that wasn’t Thatcher], dental charges, increased workers taxes via National Insurance, benefits not linked to average wages, prescription charges being scrapped but then reintroduced, tax allowances being cut, and a doomed program of building cheap high rise flats. Their attempt at playing the money markets went wrong with the devaluation crisis from which the government never really recovered.

 The first Wilson administration can certainly lay claim to a number of major pieces of social reform for instance the repeal of the death penalty, decriminalisation of homosexuality, changes in the law regarding divorce, abortion and race. However this is social tinkering: this is not changing
the relationship of power in any meaningful way.

 Harold Wilson's next regime which lead into James Callaghan I would term the period of walking a tight rope. The first was in a minority administration and re-election in 1974 saw a wafer thin majority of four.

 This meant the government was never in a particularly powerful position and effectively five years in office were spent riding the storm of an economic recession brought about largely by the oil price hike and the Barber boom.

 Again the major impact was a series of social tinkerings: tenancy rights, improved benefits, sex discrimination act, prices commission and workers’ rights. However the government finally ground itself out in the so called Winter of Discontent, after borrowing from the IMF [again] led to large cuts in Government expenditure.

Which brings us to Tony Blair. New Labour had set out its stall as the party of capitalism when at conference Tony Blair called for the abolition of Clause 4 - probably the last vestige of any socialist intent within the Labour party structure. In 1997 there was a pledge card provided to voters which didn't offer much in terms of socialism - which was pretty much the overall picture of the Blair administration. They promised to cut class sizes, fast track offenders, cut NHS waiting times, reduce under 25s unemployment and have tough rules for Government spending. To be honest what was on offer was a managerial approach to capitalism: we can run it better than the Tories.

So we got the minimum wage [at a very low level] and Sure Start but we also got PFIs, Iraq, the rich got richer, and corporations got much more powerful and they also paid less tax. We were told this was a new kind of economy where boom and bust was beaten for good - but this hubris crashed in the banking crisis of 2008. Need I say more?

Not much of a record for 10 election victories: not much socialism anywhere in the picture. Not much of a basis to think Corbyn will make massive impact. Has he distanced himself from all that? Apart from apologies promised for Iraq [even Blair is working on that now] it sounds very much like he’s offering a version of Wilson Mk 1: bit of nationalisation, taxing the rich, government spending and more welfare.

 Even Dennis Healey, a right winger, as chancellor offered to tax the rich until their pips squeaked. Not much of that kind of talk here.

 So question two: will it work anyway. Perhaps the foregoing has given a glimpse of the issues but let’s try another tack. What Labour is trying to effect is a benign and responsible capitalism: a system where they accept there is an unequal distribution of wealth and power but where the state is enabled to act as an arbitrator and redistributor thereby minimises the impact of this inequality within certain limits.

  This is all the while still remaining a member of all sorts of capitalist power blocks [eg WTO, GATT, EU, etc] because they want to maintain global trade. So the theory must be that while the rest of the world carries on trying to lower
costs and hence wages, somehow we will manage to continue trading
will them and maintaining decent wages and conditions.

 Presumably this is predicated on the notion that we will somehow be able to redistribute the excessive profits of business and have lots of internationally
desirable commodities and services for sale, cheaply enough to maintain
our position as the sixth or seventh largest economy in the world.

 One wonders at what point does this wonderful government start to dismantle
the financial services industry which makes a huge contribution to our economy, but contributes not one iota to production? Apparently if the City of London were floated off as a separate country it would be the 16th largest economy. That gives an idea of how big a share it has of UK plc.

 The City puts £65bn pa into the treasury [although note that only about £6bn of that is corporation tax…] – about 11% of total tax take. Much of what they do differs little from a casino…thinking of which, gambling contributes £2.3 bn pa to the Government coffers: anyone want to shut that one down? Paddy Power is now bigger in Ireland than the Bank of Ireland…

Why am I going through all this? Answer because if you want a bigger economy, the last thing you are going to do is start making life too difficult for big players: you have to find some way to coexist with these capitalist enterprises, which means you have to recognise their interests in one way or another. Sure you’ll try to curtail the egregious excesses but in reality you’ll let them get on with it in some regulatory framework or another.

We have regulatory frameworks at the moment for all sorts of things: Ofwat, Ofgen, Ofcom, Ofsted, Ofrail. Let’s accept that these ones are charades and that Corbyn will introduce big tough ones. The problem is that governments only last 5 years. Someone else can come in and water them down. What has been the trajectory of the NHS since inception? What was the trajectory of the nationalised industries? All have started with great aspirations and fallen under the millstone of government funding decisions. Just a little bit of prescription charging to start with and then where do we go?

I note too Corbyn recently has been offering to build more housing not only to rent but also to buy. What is more clearly showing the have and have not of our society than the house ownership divide? And what is the long term game plan? Everyone an owner occupier? Not everyone can afford one. So it seems he is content to embed the two tier society…

Here’s the rub. Even if JC did manage to tame the forces of capital enough to raise the economic condition of the bottom 50% and similarly reduce differentials in UK, he would not really be addressing the distribution of power: sooner or later that power would reassert itself, particularly if there was an economic downturn. What would stop the rich choosing to take their money elsewhere or to simply sit on it? To stop the investment and the trickle down supply and whatever else?

Desperate not to have them do that, there would be all sorts of concessions. What would stop the large corporations, foreign and UK, simply moving their activity overseas? Unless this remains a country friendly enough to business, business will prefer to be somewhere else.

 Anyone recall an event during the Major government called Black Friday? International currency speculators bet against the pound staying in the ERM [a precursor of the euro] and forced us out. Having a financial system which runs on credit and borrowing as we do, the government has to borrow money to make ends meet. We have seen the effects this circus can have on countries’ abilities to run themselves –
Greece is a recent example. Unless your Government is self sufficient, sooner or later you’ll need to go to the money men and offer them a proposition that they like. Otherwise you will go without and their money will go to someone else.

Trying to make sure I haven’t been unfair to JC and the crew, I checked the LP website to see if there were any more promises I’d missed; any further policy clarifications which would radically shift power from top to bottom. I was surprised at what I found. The home page pictures JC’s victory and points you immediately to the Join Now page without anything about what you are joining. Not an iota about policy. Click the buttons on the tops and they all lead to the same 4 reactive news items: each one about how the Labour Party opposes what the Government is doing. I hunted through the website for anything of substance and I found this:
• Why should I join? Our recent election defeat was hard but that doesn’t mean we’re going to stop fighting for a fairer country. We now have 330k members…vital in ensuring we…will succeed in the next election and hold this Tory govt to account
That’s it…apart from
What next? You’ll be able to call yourself a card carrying member of the
Labour Party [so that’s alright then] There is also, if you look, a history of the Labour Party [a buffed up version of what I told you earlier] that ends with Brown becoming PM….[fortunate?]

Sad but true. The truth is that unless this whole approach is entirely rethought and scrapped for a better system, we’re onto a loser. How fortunate then that help is at hand: Socialism. Abolishing money and the whole financial exchange mechanism means those who had large amounts of money are suddenly deprived of all that power: they could make hats out of their bank notes for all the difference it would make. A system of production for use as determined  democratically is the only way by which the working class can achieve emancipation. Jeremy Corbyn may look like a breath of fresh air but he’s as stale as the party he now leads.


dan lambert said...

Very good, shame I couldn't make it..

Dave Chesham said...

The link to this transcript was posted on the London TZM Meetup group. One of their members stated her appreciation of the link.

Dave Chesham said...

Another poster made this comment:

"I think it's unfair of the speaker to disparage Corbyn so much. First of all Corbyn's hands are tied by all the Red Tories in the Labour Party so there's only so far he can go with reform of the party, & secondly even if Corbyn were able to turn the party into something that all of us who are opposed to capitalism would approve of, the sad fact of the matter is that the British public just would not vote for him. Over half of the British electorate voted for right-wing parties this election. More work needs to be done on the ground to change hearts & minds before we will ever see a sea change in society, & that's the cold hard reality. Frankly I'd rather have Corbyn than Cameron, as he is the only realistic chance the poor and the disabled in this country have of getting an improved situation. At least Corbyn is willing to reverse the austerity cuts so that 1000s of sick and disabled people don't have to continue to die unnecessarily and a million won't have to starve & queue for food."

Dave Chesham said...

Yet another contributor came out with this gem:

"That link is to The Socialist Party of Great Britain, a party who found the Soviet Union too right wing. Lolz"

Both this comment and the previous one have had replies...