MILIBAND AND BALLS HAVE GOT IT WRONG ON THE ECONOMY
The capitulation of the Labour leadership to the austerity and cuts agenda of the Tories and right wing press was confirmed by shadow chancellor Ed Balls’ recent statement that Labour would not reverse the cuts and would maintain the pay freeze within the public sector if they win the next election (Balls Accepts Tory Cuts and Pay Freeze, Guardian, January 14)
This comes in the wake of Ed Miliband’s public statements to the same effect, statements made after public criticism of his leadership by Maurice (Lord) Glasman, Labour peer and founder of the Blue Labour tendency within the party. This is a philosophy of conservative Labourism that espouses an emphasis on the role of voluntary organisations, churches and local charities in promoting mutualism and self help as opposed to centralism and a focus on equality. In essence Glasman’s theory echoes the postulates behind Cameron’s Big Society wheeze, at once a rejection of modern society and government as the necessary enabler of social and economic justice, and the embrace of a social model rooted in a rose tinted view of the past.
Blue Labour fell out of favour due to Glasman’s controversial views on immigration, culminating in him calling for engagement by Labour with supporters of the English Defence League.
The fact that Miliband felt obliged to respond to Glasman’s critique of his leadership with an attempt at burnishing his credentials with a near wholesale embrace of the Tory cuts agenda could prove a seminal moment in the political orientation of the party and its future direction.
The economic logic behind austerity remains as flawed now as it was when first announced by the Coalition. Rather than understand the deficit as a consequence of a global recession decimating demand in the economy, with a sharp fall in tax revenues due to a sharp rise in unemployment, the government is intent on deepening the same cycle by introducing drastic cuts in spending in the forlorn hope that the private sector will invest and create new jobs to replace those lost. The fact that those new jobs will come with lower wages, pensions, and worse terms and conditions than the ones lost is a moot point as far as the Tories and their backers within big business and the right wing press are concerned.
The UK’s deficit and national debt as a percentage of GDP currently compares favourably to other major economies. Currently it is sitting at around 60 percent. Compare this to France at just over 80 percent, Germany at 75 percent, Japan at 196 percent, and the United States at 60 percent, and the UK’s national debt cannot in any way be described as extraordinary. It also compares favourably when measured historically. By the end of the Second World War it had climbed to over 200 percent, yet under these conditions the postwar Labour government initiated the largest and most wide ranging programme of structural reforms of any British government before or since.
Today, of course, the nature of the economy is far different from what it was then. The role of international markets as the determinant of domestic economic policy is hard to resist as a result of the success of free market nostrums in dominating the ideological and economic debate when it comes to the realm of ideas. We see this with the role of the ratings agencies in deciding the rate of borrowing for national economies, with the much prized AAA rating elevated to the status of a symbol of national prestige. It reprises Marx’s analysis of credit as ‘the economic judgment on the morality of man’, with in this case the ratings agencies passing economic judgment on the morality of nations.
The idea that the likes of Standard & Poor’s, Moody’s and Fitch’s, the three main international ratings agencies, operate in a politically and ideologically neutral environment is false. They make their profit from the fees they receive from banks, financial institutions and governments. In this regard they have come in for sharp criticism over the fact they constitute a de facto cartel and continuously rate debt instruments and securities issued by banks more favourably than bonds issued by governments – this because the banks and financial institutions pay them more. The subprime mortgage crisis that hit the US in 2007 and was the catalyst for the global recession that followed is a case in point.
The difficulty for any national economy trying to come out of recession lies with the decline in international aggregate demand. In fact, there has long been a crisis in international aggregate demand due to the overconsumption that has been a factor in the West and the concomitant underconsumption of the developing world, leading to downward pressure on prices and rising levels of consumer debt.
The ongoing crisis in the Eurozone negates the viability of Britain being able to export its way out of the recession, certainly not in the short term anyway, leaving either a policy of cuts or measures to stimulate domestic demand. This should range from the simple act of reversing the rise in VAT – and indeed cutting it below the 18 percent it was set at previously, which would benefit those on moderate to low incomes who spend rather than save – to implementing a system of progressive taxation and closing off tax loopholes, which for too long have ensured that the rich have been able to avoid contributing their fair share to the exchequer as a proportion of income.
Britain’s under par infrastructure is crying out for major investment, as is a housing crisis that grows worse year on year. The jobs created would give a massive boost to domestic demand, with every pound invested having a multiplier effect throughout the rest of the economy. Inflation could be controlled via a combination of taxation and interest rates. The only pay freeze within the public sector should be applied to management and high earners, such as the 9000 who are currently taking home more pay than the prime minister.
When it comes to welfare, Labour needs to fight for those on benefits rather than accepting the narrative that they are workshy scroungers who are morally deficient and deserve to be treated as criminals. The government’s cuts in housing benefit and its policy of forcing people on disability benefits to come off on spurious grounds must be reversed. The current level of Jobseekers Allowance is set far too low to achieve anything other than forcing claimants to survive by entering the black economy. Furthermore, the knock-on effect of rising levels of stress related illnesses, crime, and other social maladies associated with poverty impact society as a whole. In economic terms, demand needs to be introduced at the bottom rather than the top of the income scale, where as a matter of necessity people spend every penny they earn rather than save or invest on the financial markets.
Also as a matter of priority should be more government control over the operations of the banking sector, with a view to engineering a gradual replacement of an economy configured around inflated property prices that has dominated over the past three decades with one based on new technologies, green industries, and manufacturing. Renationalisation of utilities and the commanding heights of the economy would take us back to the future.
The aforementioned constitutes a concrete and viable alternative to the status quo. Unfortunately, the current Labour leadership seems unfit to the task of breaking through the free market consensus of the establishment, including the media, to argue that alternative.
What should never be forgotten is that any debate over the economy is fuelled as much by ideology as economics. The public capitulation of Ed Miliband and Ed Balls to the right wing narrative of austerity reveals an ideological accommodation to the free market that should worry every Labour member and supporter who had higher expectations and hopes of a resurgence of the left within the party after the last leadership election.
Excellent and timely article John and I’d say I agree with you about 90 per cent.
I think the first thing to bear in mind is that both Eds are committed left-of-centre social democrats, so this is a major political retreat that’s been forced on them largely by Labour’s Blairite right wing.
All of the arguments John uses above against the Government’s austerity programme are absolutely spot on, but the left has failed to collectively articulate this and has failed to win wide support for it.
Our failure to do this, whether as individual LP members or non-Labour left – has allowed the political environment to develop in which this retreat can be forced on the LP’s two leading figures.
Rather than a futile “condemnation” of Balls’s and Miliband’s “betrayal” We should ask ourselves what can we do to ensure that the poliotical and economic agenda outlined by John above can win wide support across the UK public and push the political environment to the left.
#1
Good points, Karl. Yes, the toxic environment within the mainstream and Labour is a major factor in this development. But this reflects the inability of the current leadership to resist the and defeat the Blairites. I’d say they need to take their share of the blame for that.
For me Ed just isn’t leadership material. He doesn’t have the force of personality to assert his authority and/or vision. I’m sad to say, but I feel this will prove his undoing.
“When it comes to welfare, Labour needs to fight for those on benefits rather than accepting the narrative that they are workshy scroungers who are morally deficient and deserve to be treated as criminals.”
Indeed, but in the longer term Labour needs to revive the commitment to try to achieve and maintain full employment, as in the first three decades following the end of WW2. In recent years we have seen economic booms combined with unemployment levels that would have been unthinkable in previous decades. Liam Byrne’s recent piece in the Guardian [http://www.guardian.co.uk/commentisfree/2012/jan/02/beveridge-welfare-state-labour-revolution] almost hinted at the idea (“a responsible government taking determined action to create work”), but didn’t even begin to spell out how that might be achieved. Under its present leadership team, Labour doesn’t seem to have the stomach for the amount of direct state intervention in the economy that a full-employment policy would require.
I live in the Ward which has the highest rate of Child Poverty within my local authority area, at 40%. The community emerged on the back of a coal industry that no longer exists. The community has no economic reason to exist, not directly on the motorway routes, no rail access. A late 19th early 20th century community that is out of place in the 21st century. The kids work hard at school with one aim, to get out. Those that realise they are not going to get out seem to enter a group passive depressive state which with the aid of drugs and alcohol fills the gap left by the absence of political discourse, a numbing acquiescence. How can the politicians deal with this situation, a New Deal programme along the lines of FDR’s would be a major step in reintroducing a work concept that is absent at the present, a work ethic may then emerge. Capital has no reason to invest in these communities, some form state intervention should be considered. Of course the nicer areas will be bought up by affluent working class who have the ability to commute and the villages will change through time, but intervention is needed as a social necessity.
http://endchildpoverty.org.uk/why-end-child-poverty/poverty-in-your-area
This is the end of the road for those arguing for a turn back to Labour and that the project of a new working class party is no longer possible.
There is a crying need for a working class alternative to stand both in elections against the three parties of cuts, and able to both extend practical support to struggles against the cuts, to articulate in economic and political terms an alternative whole agenda of making the working class and the poor pay for the capitalist economic crisis.
It is nonsense to say that the two Ed’s are ‘left of centre’ social democrats. Balls was Brown’s right-hand man through the latter period of New Labour. Miliband is perhaps slightly to the left of that, but only in the sense that used to be true of Roy Hattersley when he was commenting on Blairism. If these people are social democrats and not simply part of New Labour outright, they are spineless right-wing social democrats a la Hattersley. The slight leftist bulge that Ed Miliband’s election represented has been played out, and they have simply capitulated to the neo-liberals.
We need a new working class challenge to Labour, otherwise there will be nothing in the political/electoral arena to even oppose the most brutal aspects of the cuts. TUSC is a start, but not the finished product at all. We need a fully fledged democratic working class party with freedom of criticism and the political impetus to develop a socialist programme of struggle relevant to today’s conditions. We need to overcome the Toytown sectarianism that mars the left and build something serious that can sink roots in the working class over a prolonged period.
Ed Ball’s pronouncements yesterday are a kick in the teeth for Labour’s voting base.
As a result, many of them will be unable to distinguish Labour’s policies from the Coalition’s.
The UK economy is in steep decline.
Austerity measures make it even more severe.
Only government investment can halt the steep decline in the UK economy.
But with a declining tax revenue base, where will the funds come from?
Not by attacking public sector workers.
The Labour leadership should focus on taxing the super-rich, controlling the offshore companies, the property speculators, high paid managers and directors.
Re-nationalisation of banking and basic industry has to be put back on the agenda.
“The incredible shrinking UK economy”
By John Ross, Socialist Economic Bulletin
Sunday January 15th.
extracts:-
“…no other economy in the world has shrunk even remotely as much as the UK”
” the fall in UK GDP in 2007-2010 was $562 billion compared to the next worst performing national economy, Italy, with a decline of $65 billion
– i.e. the decline in UK GDP in the common measuring yardstick of dollars was more than eight times that of the next worst performing national economy”
“The UK accounted for a somewhat astonishing 77 per cent of the EU’s decline.”
“…contrary to the government’s anti-European rhetoric, UK economic performance in constant price national currency terms has been significantly worse than the Eurozone during the financial crisis”
“…between the beginning of 2008 and the beginning of 2012, the pound’s exchange rate has fallen by 21.0 per cent against the dollar compared to the Euro’s 11.4 per cent drop in the same period.”
Full
http://socialisteconomicbulletin.blogspot.com/2012/01/incredible-shrinking-uk-economy.html
#5
really? Why is this more significant than wage restraint pushed by labour governments under wilson and Callaghan?
In 1976 Labour was in power and betraying a major working class upsurge that put it there after promising a positive alternative to Heath.
What Balls and Co are now doing is the equivalent of if Wilson had endorsed Heath’s policies and promised to keep all of them.
Now a vote for Miliband/Balls is a vote for the cuts.
#8 The key question is how to pursuade millions of people not just that the cuts that are affecting them and others are unfair,harsh brutal etc but that that they are not needed and that there is in fact an alternative.
Whether the political vehicle for winning the argument is outside or inside the LP (or both)is another question.
But a tiny self-proclaimed new workers party with minimal support and zero chance of being elected is to me of little if any more use than the Labour Party even as currently constituted.
The question that needs to be asked is why a majority support austerity. Well, firstly this is because austerity has come to mean (thanks to the media) an attack on wasteful expenditure in the public sector. The bail out of the banks is long forgotten, the public are goldfish! The public have decided to line up behind the corrupt politicians, the self serving rich, the gangsterist media and the banksters.
None of the above is surprising. While capitalism has been in crisis we are not talking here about absolute poverty. Most people still have a decent standard of living, in historical terms and relative to other people in the world. It isn’t surprising most people still cherish this system, like children cherish the embrace of their parents. And while the publics capitulation to the horsemen of the apocolypse is depressing there is within it something I can support. The idea inherent in Keynes, the idea that you just spend spend spend you way out of trouble, the idea that production is for productions sake. people are correct to say no to this solution. People are correct to ask how money is spent and what is produced. We on the left should not be putting forward Keynesian solutions, which says give a man a shovel and tell him to dig an hole no-one really needs. We should challenge this so called solution, just like the deluded public indirectly do.
We need to offer a real alternative method of production, the first thing we should propose is nationalisation of the banking, utility and retail sectors. We should then introduce incentives for worker controlled enterprises and we shouldn’t be talking about full employment or boosting demand, we should say let’s have a system that allocates resources more rationally than the current system.
“But a tiny self-proclaimed new workers party with minimal support and zero chance of being elected is to me of little if any more use than the Labour Party even as currently constituted.”
What really, less use than an ‘opposition’ party that supports all the government’s most severe attacks on the working class and openly promises to carry on with them if elected?
Workers will not vote for more or the same. They will reckon that if everyone stands for the same thing, why bother to change? This policy means the Tories will win hands down because everyone agrees agrees they are right!
There is no reason why a new working class party should be tiny. Both the Socialist Alliance and Respect showed potential to appeal to sections of the working class. It it should not be beyond the ability of of the left, on the basis of that experience, to create something better, more principled and more democratic than both.
The Labour Party were never opposed to the austerity and cuts agenda. They adopted the “too far too fast” compromise for political and electoral reasons not economic. Now that it no longer has any traction in terms of political advantage it is discarded so that it is no longer a point of differentiation for voters between Labour, Tories and Lib Dem.
There is no “too far too fast” compromise to be made. You either believe that cuts and austerity are the answer or you don’t and you make you argument on that basis.
#1
You have a very strange definition of ‘Social Democrat’.
Ed and Balls are not social democrats. They want ‘fair capitalism’ whatever that particular oxymoron is supposed to mean. There has been no retreat to the right because of the influence of Blairites… they are saying the same thing that they started out with… they have just said it a little more clearly.
And where is the outrage and uproar from the rank and file labour member???
Nup! The labour party is neither socialist nor social democratic. It’s capitalism with red flags to fool the plebs.
#5 is right (along with fighting trade unionists) in saying that the working class needs political representation and will not find it in the Labour Party.
There are no signs of a left-resurgance in the vast bulk of labour members. We will need to build a new mass workers party… even if that means baby steps… we still must do it.
We MUST do it.
[please ignor my speeling mistaks]
#8
But labour party confernce had supported the idea of statutory wage restraint (inspired by the arguments for socialist planning by Tommy Balogh) at its 1963 conference, under the Macmillian government.
Why is this categorically different today?
#14
I may be wrong, but wasn’t the proposal wage restraint in return for a high or improved social wage?
John is on the money with this article, but let us not forget that the actual issue is a pay freeze by the current Tory led government, not ahypothetical pay freeze from a future labour government.
If the unions defeat the Tory pay freeze, then we are in a different position, both with public opinion, and within the Labour party.
That was explicitly the case in the policy adopted by the 1973 conferernce; the emphasis in 1963 was more related to restoring the competitiveness of british industry as a precondition for social advance.
The interesting thing is that had Britain under Wilson’s first government been able to acheive the same levels of economic growth as Honneker’s DDR in the same period, then it could have delivered its promised social programmes.
Andy Newman,
“(inspired by the arguments for socialist planning by Tommy Balogh)”
I think there is a bit of a difference between arguments for wage restraint ‘inspired by arguments for socialist planning’, snd the current support for austerity and the working class paying for a rather significant crisis of capitalism, seen to be caused by predatory finance capital.
Spurious as the former is, you could have an argument about that within a ‘socialist’ framework. You won’t find anything like that here.
The MacMillan government, by the way, upheld the social democratic consensus, welfare state, and all kind of reformist things. It was ‘Butskellite’. The current government, carrying on where Thatcher and Blair left off, is destroying these things. Now with the open support of Labour.
In any event my point is that the unions were opposed to wage restraint by the 1964 to 1970 labour government, but did not draw the conclusion that there was no dfferiecne between labour and Tories.
Despite these disappointing and wrong-headed statements by Ed Balls and ed Miliband, we would still be better off with a labour government.
#18
No, for example, the macmillan government scandalously ran down the NHS to the point that there were 20000 underused beds in 1964 due to staff shortages.
But the shared economic consensus of those years was based upon options no longer available
Robert Wiliams says the two Eds are not social democrats, but advocates of a “fairer capitalism.”
Erm…isn’t that what social democracy is, in essence?
During the “golden age” of social democracy – 1945/1979 – we still had capitalism, but underpinned by a strong welfare system, universal access to free healthcare and education, full employment and social housing for all.
But the “commanding heights” of the economy remained under the full control of the capitalist class.
Robert, social democracy is a “fairer capitalism”, a capitalism which has been forced to concede significant ground, but still a form of capitalism.
This is broadly the type of socioety that the two Eds believe in.
Socialism is different to social democracy.
(this in reply to Andy Newman at #20)
Does that really compare with the wholesale demolition job going on today?
A demolition job now being openly supported by Labour. The reason the Tories were conciliatory then was because, despite the terrible politics of Labour, the working class was strong. Today the working class is weak and Labour is doing everything in its power to make it weaker.
And they will lose the election for the simple reason that when all the parties agree on bashing the working class, workers will vote for the organ grinder rather than his monkey. So you are pretty unlikely to get even the pathetic excuse for a government you are bleating for.
No Redscribe, it’s utterly illogical to claim that working-oclass voters will back the party that attacks them the most.
In elections, voters will always vote for the party that they feel best represents their interests.
For working-class people, that party will be Labour – not some “let’s-pretend-to-be-social democrats-and-hope-they-don’t realise-we’re-all-trotskyists-really” electoral front.
This is because firstly, such an electoral front doesn’t actually even exist at the moment. Secondly, previous attempts at setting up such fronts have all failed. And thirdly, each time such fronts have been attempted, each one has failed sooner than the previous one.
By contrast, the Labour Party does exist, it has hundreds of thousands of members, and is supported by millions of trade unionists and it has a chance of being elected to government.
Karl Stewart,
“it’s utterly illogical to claim that working-oclass voters will back the party that attacks them the most.”
That’s not what I said. If all parties agree that the attacks on the working class are ‘necessary’, then logically the one that is most clear about the ‘necessity’ for the attacks will win out.
That is actually why popular-frontism does not work. If you adopt the politics of the enemy class, you concede the ground to that class enemy, and sooner or later, the most consistent exponents of that politics will win out.
This is the correct analysis but it provides no position whatsoever on the tasks facing socialists in the coming period. It seems to be analysis for the sake of analysis.
For me, the only short term and long term solution is to begin the process of buidling an alternative to the Labour Party.
No, if Party “A” says: “Vote for us and we’ll close down the NHS, end free education, throw half of you out of work and cut the wages of the rest,” and Party “B” says: “Vote for us and we’ll reduce your access to the NHS, cut free education by half, throw a quarter of you out of work and freeze the wages of the rest,” then logic dictates that those affected by this programme (apart from the masochists among them) will vote for Party “B” in preference to Party “A”.
Whos’ this party B? I’d like to vote for them, assuming I’m alive in 2 or 3 years, which is a big assumption since I’m disabled – I note that ending the random removal of support from the sick and disabled didn’t feature with either party A or B. Big surprise!
So who’s party B? The Greens? What happened to them by the way?
No surprise about Balls – he has previous:
http://unisonactive.blogspot.com/2012/01/balls-opponent-of-nmw-supporter-of.html
Karl Stewart,
The really is not how things work. Party A has won the argument; party B looks like just a paler version of party A. B is a servant, A is a master.
This actually explains why the previous lot of Tories won four elections on the trot. Eventually people get tired of them of course and want a change, but even then the change (Blair) was hardly much different from the original (Thatcher/Major). Its a simple concept – hegemony. Miliband/Balls latest clarification means we are back in that territory.
To defeat them you have to break that down by fighting against them.
What we have at the moment is a version of ‘If you can’t beat ‘em, join ‘em”.
#13 “And where is the outrage and uproar from the rank and file labour member???”
All over Facebook and Twitter by the looks of things.
I would suggest to active Labour Party members that they start the hunt for a new, left-leaning leader as a matter of urgency. Clearly Milliband himself thinks he can’t win the next election by espousing a social-democratic platform, and as others have pointed out, he largely regurgitates Coalition dogma . And whatever union support he may have had (which must be under strain right about now,given his comments),his quality of mind, etc, he simply does not have the presence of a serious Prime Ministerial candidate, shallow as that may be, and I don’t think Balls does either.
This interesting comment from Eoin Clarke of the Labour Left shows Ed Balls’ article and speech is not a departure from the course Labour have been pursuing until now: http://eoin-clarke.blogspot.com/2012/01/why-socialists-should-support-what-ed.html
Andy Newman,
Are you sure? You don’t sound convincing. They have adopted the ConDem economic and welfare policies, pose absolutely no threat to capitalism and certainly will not introduce any socialist policies. Reform from within is now well and truely cut off. OK, let’s give you the benefit of the doubt and Labour would be better. If it were, it would only be on a very marginal basis as modern history testifies. Is that worth fighting for or should we be striving for something better?
Karl Stewart,
No Karl, fairer capitalism is not the same thing as social democracy.
That many in the labour party do not understand that is testimony to what that party has become.
They are capitalists with red flags to fool the plebs… and fool themselves too.
Well, if they were even for fairer capitalism – you know, what gave us the NHS, Legal Aid, Social Security, Free and comprehensive education… but the LABOUR PARTY ARE FOR UNFAIRER CAPITALISM – they just want the perks that go with delivering it. They don’t need to convince the electorate of anything – the bosses media will do that – especially if there’s no choice.
There is scarcely ANYONE – not even Tories – in the UK who wants to see the end of the NHS, but Labour can’t even defend that like they care!
The only debate going on at the top of the Labour Party is whether Ed M. is geeky or not. So the sizzling political debate is over whether in order to beat Tories you need someone with ‘charisma’/X-factor or whether an anorak/policy wonk can make it. Though no one dares say it, there’s also another crucial political debate going on as to whether it’s possible for someone who doesn’t look, you know, WASP, can get elected. Oh yes, this is politics as we know it, as we know it, as we know it, as we know it, as we know it, as we know it, as we know…
36# I am a bit slow, I missed the whole “Jewish” thing until last week, Blair, Brown & Cameron, Celtic roots in part for those enamoured by those things, we all knew Tony was really a Catholic, I don’t think it will matter much.
Robert, I would define it in those terms. But you clearly disagree, so I’m genuinely interested in how you define social democracy.
As a Labour Party activist this is demoralising. Neoliberalism faces disintegration but seems in the UK stronger than ever. Ideologically the Coalition is in big trouble but the Labour leadership seem even more so. Why is Ed M not floating radical ideas: a massive council house programme; rent controls instead of HB caps; a 35 hour week; socialise the banks; scrap Trident and shrink the armed services to EU average; turn our football clubs into fan owned entities and nationalise Sky sport; close down tax havens? Why…? Because he lacks the imagination and the steel?
#33
Well within the evidence of just the last few years, the current government is clearly much much worse than Gordon brown’s
Karl Stewart,
Google it.
Well, perhaps I can be more helpful than that? Wiki isn’t the best website in the world, but it will do for this….
“Traditionally, social democracy is an international political movement seeking a gradualist path to socialism through ameliorative reforms made on behalf of the working class. It relies on the use of the democratic process to achieve its aims as opposed to revolutionary means.[1] In terms of modern social democracy, one view presented calls for the profound reformation of capitalism to align it with the ethical ideals of social justice while maintaining the capitalist mode of production, rather than creating an alternative socialist economic system.”
So, I take the traditional point of view that social democrocy is a reformist road to socialism. You seem to take the more ‘modern’ point of view.
But this ‘modern’ point of view is a new invention that has nothing to do with genuine socialism or social democracy, it renders them meaningless.
Agree entirely. Balls’ volte-face over the weekend was sickening. And we need to be clear, it was a volte-face……..
Actually, Miliband probably is a right-wing social democrat, just about. ‘Fairer capitalism’ is not really a mark of social democracy, Nick Clegg could go for that rhetoric and even Cameron is using this language to an extent. Social Democracy, in its more right wing form, means an attempt to modify capitalism in some ways in the interests of the working class, not just abstractly to make it ‘fairer’. More left wing forms of social democracy aspire to replace capitalism itself with some kind of socialism through parliament.
Ed Miliband did make some noises in his leadership campaign about addressing a crisis of representation for Labour’s working class base. He was the only one who did (Abbot excepted), and that is why he got the union backing he did and why he won.
But much of Labour is not even right-wing social democratic. I don’t see Balls as such, nor his mentor Gordon Brown. They are outright neo-liberals and privatisers. And under massive pressure from the neo-liberals, Blairite and Brownite, in the LP, and of course from the government itself, Ed Miliband seems to have capitulated and let the neo-liberals dictate the policy on the cuts. Brownite, rather than Blairite, neo-liberals are now ruling the roost. But they are still neo-liberals and Ed Miliband is their prisoner.
I think that the husk of social democracy that is the Labour Party is represented perfectly by Ed Balls and Ed Miliband. They are people who think that the difference between their party and the Tories is them. They think they are more ‘ordinary’, ‘nicer’, more ‘honest’, more ‘decent’ and ‘fairer’ than the Tories. They can even extricate a social difference ie they come from a different fraction of the middle class and this gives them virtue.
This runs very deep in British culture: the upper fragment of the middle class is seen by the lower fragment as corrupted by its cosiness with the aristocracy. The lower fragment is supposedly purer and more virtuous because it’s less flashy, less posh.
In political terms it’s now utterly trivial. When the lower fragment was linked to a form of Christian (eg Methodist) Socialism it had a radical edge. Not any more. It’s nothing more than the crap people talk about how there is something more leftwing about living in one part of town rather than another.
Blerchhhh!
Who cares if Miliband and Balls are representative of social democracy or not.
‘Social democratic’ parties have been conceding the argument and supporting austerity all over Europe – whether the Labour leadership is simply being ‘social democratic’ in the same vein, or they’ve abandoned ‘true’ social democracy, we need to accept that to the extent Labour acts as the left wing of the coalition government and its cuts, it is our enemy.
#45 You’re flying off the handle there.
Balls made his opinion of the cuts clear:
“With growth stagnating around the world, every country pressing ahead
with deep cuts risks being a catastrophic mistake.”
And he said he couldn’t make any promises to reverse cuts made by the Tories as no one knows what circumstances will pertain as a consequence of the Tories disastrous policies.
All sounds very uncontroversial to me.
Thanks for the answer Robert. Some interesting points there. I agree, the meaning of the words “social democracy” have changed over time. Let’s remember that Lenin’s “Bolshveiks” were so called because this is the Russian word for “majority”, in reference to the fact that his was a majority faction within the Russian Social Democratic and Labour Party. But nobody today would describe Lenin as a “social democrat”.
And the British “Social Democratic Federation” of the early 20th century was a revolutionary movement, which became one of the founding parts of the British Communist Party I believe. But nobody would call social democracy a revolutionary or communist philosophy now, in 2012.
What you refer to as “the modern definition” is, to all intents and purposes “the” definition now isn’t it?
It broadly describes those who would aspire to something like the post-1945 settlement.
Both Ed Balls and Ed Miliband are broadly of that persuasion and the policy statements that are the subject of this thread represent not so much their own personal ideological creed, but a feature of the current balance of forces within the Labour Party – the current ascendancy of Labour’s neo-liberal wing over its social democratic wing.
I think the best response to that is for all of us to strengthen our efforts in arguing the socialist case against cuts and austerity. John’s arguments in the articla above are fundamentally sound ones and ones arouns which socialists and social democrats can unite. It’s also an economic and political agenda which is supported by Labour’s trade union affiliates.
Whether we arer individual LP members or not, we can all take part in this struggle for ideas in everything we do – in our trade unions, in any campaigns we’re involved in and in political discussions with others.
Absolutely the wrong conclusion to draw is to turn our backs on mainstream political discourse altogether, cut ourselves off from Labour’s hundreds of thousands of members and millions of affiliates and unthinkingly repeat the futile failures of the past 15 years of “left alternatives to Labour.”
That strategy has been tried time and time again and has failed time and time again – each “alternative” failing sooner than the previous one, each winning fewer votes than the previous one, engaging smaller groups of people and making less and less impact.
Karl, don’t you think it would then be smarter for Labour to position itself much further to the Left than it currently is, with a leader who can forcefully put forward genuinely social-democratic policies in stark relief to the Condems,rather than the tepid, mealy-mouthed, uninspiring stuff coming from Milliballs?
Omar, yes and no.
Yes of course we need a far stronger and more fiercely argued political and economic alternative to that of the Government. This is something we all have to fight for.
And no, I don’t think a change of leadership will help that process at this time. Who are the alternative leaders Omar? In the current environment, a change of leadership personel would be a move to the right.
Well, then a) either find/create one or b) concede that the LP isn’t fit for purpose.
#47
Indeed, words change. back in 1947 to 1950 the most right wing group in the Labour party, committed to retaining the empire, rallied around a magazine called “Socialist Vanguard”
Must be getting something right Luke Bozier has joined the Tories, now to find out who the F Bozier is.
It’s your actual program that matters at the end of the day. And if you are genuine and determined enough to do what needs to be done to achieve that program.
Whatever label you want to call Ed, Balls and the Labour Party, their program, or any other program they look likely to produce in the future does not represent what ordinary people need.
The problem is when the same label is used to stand for something worth fighting for, and when it is used as a screen to mask off an utter failure to have any principles or program whatsoever.
Out of interest,what are members of the Labour Party doing to alter the course of the Party? Groups like the LRC and Socialist Appeal still exist, maybe there are others as well. Whats the strategy behind “reclaiming” the Labour Party?
Obviously it would need to go beyond simply replacing the leader. To reclaim the Labour Party would mean getting socialists elected to councils and Parliament, reinstating democracy within the Party and giving power back to the NEC. How do Labour members intend to do this? Milliband has clearly lied to the unions in order to win the leadership, he won’t be taking Labour to the left. So what next? Will you sit and wait to see what happens whilst attacking socialists outside Labour who want an alternative? Or is there a plan?
in the short term it may appear better to vote in a nominally Labour govt, but long term it’d be less damaging to socialism if the Tories won the GE… because the nature of the Labour neo-liberal scaredy-cat brigade is that they will NOT change if they ‘win’ a GE; they would proclaim that as vindication and grounds for moving further to the right.
Also, the human feeling of betrayal is something that has to be taken into account. Which is worse – your supposed enemy doing something very bad that harms you, or your supposed friend/representative doing something a tad less bad that still harms you nearly as much?
TUSC or a new workers party would not have to win 300 seats or even 50 seats, to make a significant impact.
Due to their arrogance, the Blairites made a huge tactical error in the past and placed their candidates in “safe” seats in the Labour heartlands.
If a party like TUSC concentrated their efforts and resources on winning a small number of these seats, they could knock out some carefully targeted Blairites – say, Twigg and Byrne – even if it meant splitting the non-Tory vote in a few places and letting in a random Tory or two.
What so much of this discussion ignores is that most people, including the victims, think that austerity in some form is necessary.
Tens of thousands of people in Manchester for example voted Labour in the last council elections in spite of the cuts budget.
And tiny handfuls of people (including me) voted for the small number of left of labour candidates who put forward an anti-cuts position. Where I lived, people close to the SWP were cheering the Labour victory over the Lib Dems (and I don’t hold that against them btw).
Arguing in the short term about whether the best way to get the government we ideally want is through labour moving left or by building a new workers party is like an argument as to whether the pie in the sky you want should be apple crumble or bakewell tart.
What is needed is (a) People to gain more and more confidence to resist the cuts that are affecting them, including building union membership and (b) to put forward and win the argument that cuts are not necessary to the broadest number of people possible. If those doing that are in the Labour Party or not I don’t really care so long as the argument is made and increasingly accepted.
I agree with what you say Vanya, my point is that the Labour leadership is encouraging people to believe that austerity is necessary by essentially accepting the Tory argument. Which makes them part of the problem…
This is now a major crisis in the labour movement.
Here’s my take on it:
http://redscribblings.wordpress.com/2012/01/17/milibands-monumental-balls-up-means-a-new-left-party-is-more-essential-than-ever/
Len McCluskey is right that the Labour leadership is moving in the wrong direction regarding the current government’s economic policy. Massive cuts to the NHS, local government, and education budgets are not the inevitable solution to national debt. During the Second World War, the UK national debt reached much higher figures of up to 150 percent of the GDP. It is not uncommon for countries to borrow more during the time of serious national and international crises, like wars, or economic upheavals like the one currently affecting all of us, and to pay back the debt over a period of time once the economy starts to grow again. In this sense, budget deficits can be an effective way to deal with shocks such as wars, financial crashes and deep recessions.
The policy of the ConDems seems to be based on the claim that Britain is virtually bankrupt and there is not enough money even for essential health services and education. Many people, who oppose the cuts simultaneously accept this argument, i.e. that there is no alternative but to sacrifice education and other public services in order to save the economy. Further, a large section of the British public and media appear to have accepted the line presented by the government that the total package of cuts worth £128 billion by 2015-16 was ‘unavoidable’ because of previous administration’s careless spending, and almost self-made huge deficits. Ironically, it seems the current Labour leadership has been bought into this simplistic story of the ConDems about Labour’s profligate spending being the sole reason for the UK economy’s current sad state. They should know better that until the financial crash of 2008, the Labour governments had succeeded in keeping national debt below the 40 percent of GDP target that they set themselves. In 2006/07, public sector net debt was 36.0 percent of the GDP. In 2008, it rose rapidly primarily because of ‘financial interventions’ to bailout of Northern Rock, RBS and other banks, because of lower tax receipts, and because of higher spending on unemployment benefits, all caused by the global recession. The current deficit was caused primarily by the recession not by previous administration’s pre-crash careless spending. It currently stands as 63.7 percent of National GDP, and was projected to peak at 74.9 percent in 2014-15.
If anything, the problem of low economic activity is the real, and more urgent, issue than the fiscal stability. David Cameron’s ‘Big Society’ programme offers an ideological justification for the massive public spending cuts which are about much more than just deficit reduction. The pretence of ‘there is no alternative’ offers a means for the Conservative project to radically transform the state and to transfer more services and money from the public to the private sector. If the real intention was to take the British economy out of the crisis, then such massive cuts would not be the answer. It is already clear how disastrous this policy is: Standard -Chartered has recently commented that thanks to the ConDems austerity policy Britain is sinking deeper into a recession.
There are alternatives: we need to find a fair and sustainable path out of crisis. Budget deficits will more or less automatically heal with the economic recovery. Trying to cut the deficit quickly, in the midst of a serious recession, will damage the economy and extend the crisis. The government instead should concentrate on growth and allow growth to reduce the deficit. Cuts will not reduce the deficit, investment will. A much weaker consumer spending, resulting from massive unemployment and lower wages in 2011, is described by many as the main reason for this. Cutting too far and too fast will mean more people out of work, fewer jobs in the economy, lower level of taxation from workers and businesses, and more people on unemployment benefit, which will cost the government more. The real challenge is to introduce constructive ways to restructure the national economy so that it can deliver strong and consistent growth.
Bulent Gokay, Keele University, Staffs
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