The details of yet another offensive in the class war was announced by the Chancellor. The budget was, Osborne said it "unashamedly backs business". He announced an additional cut of £10bn in welfare spending in 2016-17. 300,000 top-rate taxpayers, who currently pay top rate tax, will see a tax cut averaging £10,000 per individual, £40,000 for the 14,000 millionaires in the UK. Yet five million pensioners will be worse off due to their tax changes. Nor did the budget contained any help for the three million in the UK too poor to pay income tax.
The Resolution Foundation think- tank chief executive, Gavin Kelly, said "People on low and middle incomes were mostly targeted by the Chancellor's rhetoric. It is astonishing that the Coalition has chosen to prioritise a cut in income taxes on the rich at a time when low to middle-income families are seeing their standard of living fall and are struggling to afford day-to-day essentials."
The issue of taxation dominates contemporary political debate. The immense complexity of the taxation system, coupled with intricate shifts in the economy and in methods of presentation, makes it a struggle to try to accurately find out what is really happening. Endless streams of statistics are hurled in all directions, with illumination being no-one's goal. Like a stage magician, the government must keep on performing its budgetary tricks to give the appearance of doing something - anything - to keep hold of some sort of interest in its audience. Taxes go up, go down, and are moved from place to place in a blinding game of find the lady. Underneath it all is the illusion that the state can control the economy, can direct its course, by playing around with its tax structure. That smoke and mirrors act remains the same, time after time. They’re axing government spending, freezing government wages, cutting benefits, keeping interest rates low and, last but not least, lowering corporation tax on profits (reduced again by 2% and will be cut again by another 2% in 2014). There’s no guarantee that all this will work, but there is a guarantee that people will suffer.
Decades ago politicians and economists were promising a future where automation and the increasing productivity would mean a shorter working week, earlier retirement and rises in the standard of living. But listen now. All the talk is about austerity measures and cuts. Public sector workers, the jobless, those on housing and sickness benefits have been the main targets but everybody is being hit in one way or another.(And the retirement age is to go up not down!)
Capitalism as we all now know is in the middle of one of its economic crises, this time a bigger one than in the recent past. The "Recession," "Slump," "Downturn" or "Crisis," whatever you want to call it, is now accepted as part of economic life. Speculative bubbles always burst sooner or later – and the larger the bubble, the greater the correction that needs to follow. And unfortunately, the consequences are typically worst for the most vulnerable section of society – wage workers. Politicians rationalise such crises, describing them as a "necessary pain" to be endured every so often. And, as usual, we are the victims. This crisis has been caused, as all capitalist crises are, by the uncontrollable pursuit of profits that drives the capitalist economy. Capitalism in relatively “good” times is bad enough, but capitalism in an economic crisis is brutal and callous. It is vital to realise that this economic crisis is just the latest in a series of slumps which are quite natural to the capitalist system. In the past, supporters of this system have mistakenly believed that politicians would be able to rid society of the detrimental effects of the trade cycle. Gordon Brown is particularly infamous for his claims to have “abolished boom and bust”. Past slumps have included the Great Depression of the early 1930s, and recessions of the mid 1970s, the early 1980s and 1990s.
The savage cuts in spending by government departments, the pay freezes for public servants, the cuts in welfare benefits, price increases due to higher VAT confirm that the role of governments is to run the state machine in the general interest of the capitalist class, the tiny minority of super rich who own and control the means of wealth production. That governments really are the "executive committee of the ruling class" that Marx said they were. Any government, whether Tory, Labour, Liberal or any combination of the three in a coalition, that takes on the job of running the general affairs of capitalism has to act this way in the circumstances. They have to accept, and do accept, that that's the way the capitalist system works and put profits before people. Ultimately, it is the economy that controls politicians and not the other way around. Some will blame the wicked ConDems for all this. But they have essentially been the agents - to be true, more often than not, the all-too-willing agents - of economic forces beyond the control of any government. Cuts are what the economic laws of capitalism require at the present time and no government can defy this. If you accept the logic of capitalism, you play by its rules – and by its rules, savage government spending cuts are just necessary and inevitable. By its rules, to fight against cuts and for higher wages is as senseless as trying to shake fruit from a dead tree.
This is a not an easy thing to explain to protestors but the fact is that under capitalism there is little that can be done to stop the cuts. These sort of protests have been going on since the end of the 1970s, when the reforms brought in in the 50s and 60s began to be gradually whittled away and, if the truth is to be told, ever since the capitalist class has had the workers on the run. Which is why most demonstrations these days are not to demand improvements but merely to stop things getting worse. All that can be achieved is a few concessions here and there. Of course people should protest at things getting worse but they shouldn't have any illusion that they can stop this. At most they can only slow it down. Fight back is necessary - the gains made by wage and salary workers on pay, pensions and other related issues have not, after all, been granted by benevolent governments or employers – they had to be fought for. And the only way for working people to defend those gains is through democratic and unified action. There is not, insists the government, any political choice about any of this: the cuts are just inevitable. To their inevitable facts of life, we must pose our own: resistance and socialist education. They started this particularly nasty and vindictive phase of the class war, and all workers are in it together whether we want to be or not. The propertied elite may have let their greed get the best of them. In their quest to re-distribute wealth from the labouring class to the idle, they have been a bit too successful: the exploited are waking up. Systems that fail to respond to the needs of the masses risk finding themselves replaced. Are we beginning to see a resurgence in the class struggle? We certainly hope so. But without a decent anti-capitalist argument, and an idea of what we are for, we¹ve lost before we’ve begun.
Governments, not just in Britain but everywhere, have had to resort to drastic austerity measures to raise money and capitalism being what it is, governments are trying to find ways to save money that they can then use to reduce taxes on profits and so help restore the profitability needed before any chance of a recovery. They have had to sell off state assets to the private sector. They have undermined the integrity of their state by introducing into it the degraded standards of the marketplace and by hiving off whole sections to private businesses. They have considerably worsened the working conditions of public sector employees. And they have drastically reduced the scope and level of services provided by national and local government. The cuts have been massive steps backward, aimed, of course, at the most vulnerable in our society. As members of the working class living on state benefits are well aware, it is quite impossible to put a little by for a rainy day, for every day is forecast as a downpour, and trying to keep your head out of the deluge is a constant problem. And for those who are wholly dependent on benefits as their only source of income, their whole lifestyle is dictated by their resourcefulness in eking out their pittance from one day to the next. Yet the government is planning to make things worse, bowing to the need to impose austerity measures in response to the global crisis of capitalism.
The story from the government is that the cuts in borrowing and public spending need to be imposed in order to restore profitability to UK Plc. The capitalist class, as taxpayers, don’t like paying a portion of the taxes that fall on them to go to repay with interest those other capitalists who lent the government the money. That’s what servicing the so-called National Debt involves: a transfer of wealth from one section of the capitalist class to another section. So, again, not our problem. It’s their debt not ours. Recovery will only come when the rate of profit is restored. Which employers are actively seeking to bring about by imposing wage freezes, even wage cuts, watering down pension schemes, and anything else they can think of to reduce their labour costs. Some have even been asking their employees to work for nothing. The capitalist class – and their political representatives in the bourgeois parties who are vying with each other with talk of a austerity cuts – have started a campaign to defray some of the costs of these payments to their fellow capitalists by cutting down on the payments and services they reluctantly have provided for the working class. The gap between those at the top of society, and the rest of us, is actually getting bigger. This is a general trend in capitalism throughout the world. In truth, the capitalists pretty much look after themselves – but for the workers under capitalism, they always did get the shitty end of the stick. To fight the same old welfare reform battles over several decades is demoralising enough, but when previous reforms are put into reverse the case against the system is stronger than ever.
Which is one good reason why we should not put up with capitalism any longer. The tyranny of money maintains injustice and division world wide. The only framework within which can be solved the problems facing humanity, not only obviously global problems such as climate change, wars and food shortages, but also the more “local” problems such as in the fields of healthcare, education, transport and the like but which are basically the same in all countries. The Socialist Party is thus anti-capitalist. There is only one solution to the economic crises and slumps of capitalism: a socialist revolution that will sweep away the fetters of the market economy for good. It can‘t be mended, so it must be ended. When we challenge capitalism, we challenge it all or we do not challenge it at all.