Editorial from the May 1990 issue of the Socialist Standard
Are memories so short? Or is that Thatcher has become so unsupportable that people will vote for anything just to get rid of her? Whatever the reason, the opinion polls confirmed by recent Labour electoral victories seem to be suggesting that another Labour government is a real possibility.
As those who remember the Wilson and Callaghan prime ministerships of the 1960s and 1970s can testify, Labour governments have always ended up administering capitalism according to its rules. Attacks on workers as greedy wreckers for going on strike, anti-union laws, troops as strike-breakers, benefit cuts, hospital closures, unemployment, poverty and homelessness are not just features of recent Tory rule. They were features of Labour rule too—because, in the end, the capitalist profit economy forces governments to dance to its tune, by putting profits before people's needs. Capitalism controls governments, not the other way round.
Capitalism can only work as a profit system against the interests of the wage and salary earning majority. Any party which takes on responsibility for governing capitalism has sooner or later to recognise this. The Tory party always has, even when not in power. In the past Labour politicians have generally learned the hard way: by experiencing the failure of their reformist attempts, when in office, to make capitalism work other than as a system where profits come, and must come, first. Today's Labour Party, however, is no different from the Tories in recognising, even when not in office, that capitalism is a profit-driven, market-oriented economy that must be allowed to operate as such.
Just before last year's Labour Conference, John Smith, the shadow Chancellor, gave a remarkably frank television interview in which he made it absolutely plain that if Labour came to power again it would impose tough spending controls: priority would be given to restoring the profitability and competitiveness of capitalist industry. "If that means we have to postpone some of our social ambitions, then we may have to do so . . . We're all agreed that we cannot spend what we have not earned and we intend to earn it before we spend it. That will be the guiding light of the next Labour government" (BBC “On the Record”, 1 October 1989).
Since then Smith, in a bid to convince the capitalists that their interests will be safe in Labour hands, has taken this message directly to the City. Labour, he told one meeting of investment bankers, was determined to "maintain a responsible fiscal policy with prudent control over public finances, spending only as resources allow and as the economy can afford”. If resources were not available, "we have to scale down our spending” (Independent, 23 February).
So nobody should entertain the illusion that Labour will restore the cuts in spending on social and public services made under the Tories. We are being told that that will have to wait till profit levels have been restored. In the meantime, it's to be austerity as usual. Jam tomorrow, as it always is under capitalism, but never today.
Smith even said that there would be "no dashes for growth" under another Labour government. “Chancellors should be more concerned to avoid mistakes than engineer the miraculous. Economic management is largely about avoiding unnecessary shocks”. In other words, a future Labour government will aspire merely to hold the ring while capitalist businesses get on with making profits. No wonder the bankers were reported to have been impressed. This is what they were used to hearing from Tory politicians.
Smith is not just expressing a personal opinion, but official Labour policy summed up by Kinnock as "making the market economy work better than the Tories”. The “market economy" is a euphemism for capitalism, and capitalism can only work as a profit system. Making capitalism work means ensuring that priority is given to profit-making. The Tories have always understood this. Now Labour has too. Their policies have become indistinguishable from those of the Tory wets. In fact Kinnock, Smith, Hattersley and the others are Tory wets in all but name. Which means that the return of a Labour government would have even less significance than in the past. This time it would represent a mere palace revolution amongst open supporters of capitalism. Like Heseltine replacing Thatcher. Tweedledum taking over from Tweedledee.