By John Pickard
Left Horizons has just published three new important booklets, specifically for the forthcoming Durham Miners’ Gala. Two of them are reprints of articles that have already been published on the website, on the Climate Emergency and the Labour Party 2022-23, but the third, Where is Britain Heading, is an entirely new document.
Unfortunately, there are some in the labour movement, including on the left, who change their views and ideas with any political wind that happens to blow to left or right. The importance of republishing articles from Left Horizons is to show that they have a consistency not only one with another, but over time. Left Horizons does not blow with the wind.
The significance of Where is Britain Heading is that it offers a perspective that is also often lacking across the labour movement, a perspective both in terms of time and in the scope of social movements. It is important to see as clearly as possible the processes of change taking place in society. We should not see organisations and movements, including the trade unions and the Labour Party, as if they were still pictures.
What we perceive on any one day is only a snapshot of an organisation in the process of change. The main driver of social and political changes in Britain is the dire state of British capitalism. Not only will it bring about changes in the coming months and years, but those changes will be stormy and, certainly in their detail, unpredictable and volatile.
Not a single political party will be unchanged by coming events: they will all be impacted, with turbulence, upheavals and splits. That will include both the Tory Party and the Labour Party. That is what is meant by a sense of perspective.
Social media bubble
But it is also necessary to have a perspective in terms of having a ‘bird’s eye’ view of the working class and its organisations. We are all to some extent obliged to participate in meetings of the labour movement and on social media, but both of these, particularly the latter, are bubbles that are not representative of the working class as a whole.
As much as there is a huge swathe of justified anger at the rightward march of the Labour leadership under Keir Starmer, with the support of right wing trade union leaders, that anger has not registered in anything like the same degree within the working class as a whole.
As opinion polls still show, although Starmer is not particularly liked or admired personally, the Labour Party has a huge lead – currently 16% (YouGov, June 14) – and as a party carries the aspirations of the class as a whole. There is a growing desperation in the yearning for change and at the moment that is reflected in a surge towards a Labour government.
It is one thing, therefore, to be inside a bubble and to express anger at Starmer – “I’ll never vote for that man’s party again!” – but for the man and woman in the street it is entirely different. We need a sense of perspective in that regard, too, and that is what Where is Britain Heading tries to offer. Refusing at this stage to support Labour – as a movement, not the leadership – is standing against a strong tide of opinion flowing through the large majority of the working class.
There is not the scope in this article to offer a summary of the new booklet, but one of the most important elements in it is the description of the long-term historic decline of British capitalism, compared to its economic peers and rivals. Left Horizons has often argued that the most sober and serious representatives of capitalism come to the same conclusions about the direction of the economy as Marxists. This Saturday’s ‘long read’ in the Financial Times was a good example of that, laying bare the “economic malaise” facing the economy.
Interest rate on government bonds now higher than under Liz Truss
The ‘financial markets’ – where governments borrow money for all current expenditures on a daily basis – are so concerned about the long-term problems facing the economy that the government is obliged to offer higher rates of interest to get loans in the market. The interest on government bonds – gilts – are currently at a higher level than they reached after the ill-fated mini-budget of Kwasi Kwarteng last September.
According to the Financial Times, “With no growth in output since last July and inflationary pressures intensifying as wage growth increases, almost no one is satisfied with the way the economy is working”. This has important implications for the next general election, due any time in the next eighteen months. It means the Tory government are caught between a rock and a hard place – unable to get inflation down without a rise in the Bank of England interest rate, but afraid of a higher rate because of the impact on homeowners.
Eighteen months ago, the BoE base rate was only 0.25% and that was reflected in lower mortgage rates. The headlines today are talking about a rate of 6%, with serious implications for homeowners.
For an average mortgage, every 1% rise in interest rates equates approximately to around an extra £60 a month in payments. Except for those on a fixed rate – and many of those will come to an end in the next eighteen months – rate rises will therefore be taking over £300 more out of the household budget. With soaring energy, food and transport costs, that is a price most families just cannot afford to pay.
All of this is taking place ahead of a general election that is expected next year. The Financial Times quotes Lord Nick Macpherson, a former top official at the Treasury, bemoaning the dire economic bind in which the Tories find themselves. “I can’t remember an election”, he says, “when, 18 months out [from the vote], interest rates were still rising steeply”.
Earnings have been flat since 2005
The UK economy is suffering the most persistent inflation of any of the G7 economies and the worst projected level of growth, no thanks due to the self-inflicted (or perhaps the ‘Johnson-inflicted’) wound of Brexit. As the Financial Times notes, “The data this week showed that while the UK has so far avoided recession, output is no higher now than in October 2019 while households’ earnings have been flat since 2005”.
The economic think-tank, The Resolution Foundation, has emphasised the challenges facing British capitalism, arguing “that the most productive parts of the country’s manufacturing sector would be doomed to decline unless ministers embraced the need for a radical rethink of trade arrangements with the EU”.
Whilst this newspaper, one of the more serious newspapers of the capitalist system, only hints at the great political storms that lie ahead, Where is Britain Heading describes the process much more explicitly. More importantly it offers a guide for labour movement activists about how to understand the process and orient their political work within it.
The three booklets: Climate Emergency, The Labour Party 2022-23, and Where is Britain heading? are available for £1 each, plus P&P. Contact the editor at editor@left-horizons.co.uk
