Is the Pound worth saving? (1999)

From the June 1999 issue of the Socialist Standard

Some said it would never happen, yet on 1 January of this year the Single European Currency became a reality. Five months on, we have seen the fall of Oskar Lafontaine, the German Finance Minister, the resignation of the entire European Commission and the Euro steadily fall in value.

Despite all of this, New Labour has started to come off the fence and demonstrate that they are preparing to recommend Britain’s entry to the project, subject to a referendum of course. This policy shift (especially after publishing the National Changeover Plan), has only intensified debate across the country, spawning a plethora of ad hoc organisations, dedicated to both sides of the argument.

Without equivocation, we in the Socialist Party say that the introduction is a capitalist question which has nothing whatsoever to do with the interests of the working class. Our class interests can only be furthered by the abolition of the capitalist wages system and all money no matter which name our masters wish to give it.

The “pro” and “anti” positions span the political spectrum from right to left. Some of the Eurosceptics to be found on the extremes of the Conservative and Labour parties are actually in favour of EU withdrawal, whilst the majority are just hostile to the Single European Currency. In the case of the Europhiles, they can be found anywhere from the Tory left, the Liberal Democrats through to New Labour. It is interesting to note that the vast bulk of the pseudo-revolutionary Trotskyite sects are defending their own variation of the Eurosceptic position.

Ever-increasing concentration

The Euro project is just the latest (but by no means the last) phase of European capitalism’s attempts to compete as an effective unit on the world stage (especially against the US and Japan). This is not just a political project, as the capitalist media likes to make out, but is rooted in the ever-increasing concentration, centralisation and integration of European capital. Indeed, the prelude to the launch of the Euro was littered with take-over activity. This process itself is part of capitalism’s attempt to restructure itself to the needs of the modern globalised economy.

Perhaps, not surprisingly, we find that the most powerful section of the capitalist class (big manufacturing and finance) are generally the ones pushing for Britain’s entry into the Euro. There are the capitalists who have a big stake in Europe either via importing/exporting or providing finance for take-overs.

It does not follow that businesses with extensive European interests who have supported the development of Europe vis-à-vis the EEC and single market EU, necessarily believe the Euro is a good idea in itself. The CBI, which represents big manufacturing capital, is actually quite divided on this issue despite its leadership being in favour. For many members, it’s not the principle of the Euro which is the problem—it is the economics of it. However, some pro-European capitalists take the view that although the single currency is not perfect, they cannot be left out of it. In fact some argue that early membership would have allowed the British government to influence the shape of the Euro project in their favour.

Bearing in mind that the majority of the British public are not Euro enthusiasts, we should expect to see a big propaganda drive over the next year or two from the powerful pro-Euro lobby (which is likely to involve the government). The most popular argument trotted out by the Europhiles is that an integrated Europe will reduce the risk of another European war because Germany will be kept in check. This is a feeble argument which totally misunderstands the causes of war. The fact that superficially Europe’s capitalists are coming together does not alter the fact that they remain competitors and this is only a marriage of convenience. If, due to capitalist logic, the arrangement should break down, no amount of political organisation at a supra-national level will prevent a war. The example of the United Nations demonstrates this.

Following on from this, we are told that from this position of political stability there will be increased economic growth via increased trade and low interest rates and inflation. The logical corollary of this would be a Europe reasserting itself on the world stage, whilst capable of dealing with its own internal balance-of-power. As pro-Euro economist Christopher Johnson argues in his book In With The Euro, Out With The Pound:

“The Euro, with the UK inside it will become a world currency alongside the dollar and the yen. Britain can thus retain, or even regain, some of its status as a world economic and financial power without giving up its national identity.”

Moreover:

“Britain can avoid German domination of Europe only by joining France, Germany and other European countries as partners in an integrated Europe” (p.197).

Quite where Johnson find the facts to support such optimistic economic reasoning is anybody’s guess. It’s certainly not supported by the first five months of the Euro, which has highlighted many of its contradictions. Firstly, there has been the constant bickering between the politicians and the bankers of the European Central Bank (see January Socialist Standard) which resulted in the resignation of “Red” Oskar Lafontaine, the German Finance Minister, and of course the corruption scandal at the heart of the EU Commission which demonstrates the lack of even basic democratic accountability. And as for the Euro becoming a world reserve currency to threaten the dollar—well it hasn’t happened yet. 

Eurosceptics

However, the capitalist class is multi-faceted and some sections are openly hostile to Britain joining the Euro. These capitalists (generally small and medium size concerns) grouped around organisations such as the Institute of Directors and the Federation of Small Businesses see joining the Euro as a costly adventure. The EU “social market” model is derided as an economic anachronism which will not be able to compete against the low cost, dynamic “free market” US and that Britain’s entry into the single currency will effectively spell the end of the Thatcherite revolution.

There is a certain amount of truth in this position. It is clear that if Britain did join the Euro there would be moves to harmonise taxes and costs since British capital would have an unfair advantage over its European rivals. However, it is also true to say that European capitalists have been trying to restructure their own economies for sometime now with attacks on welfare provision and working conditions. The results of this have been violent protests and demonstrations by French and German workers. In reality, Euro capital will try to restructure at home whilst demanding concessions from a British entry.

The Eurosceptics often claim that a single currency with a “one-size-fits-all” monetary policy would inevitably require a single fiscal policy. John Redwood, the Tory arch Eurosceptic, articulated this view in his 1997 book Our Currency, Our Country:

“You cannot have a single currency without a single interest rate, a single banking policy, a single budget and a single finance minister or central bank governor. You are inevitably led to a single taxation policy and a single economic policy. You are close to creating a single government” (Preface).

Although Redwood’s arguments may be more cogent and honest than Christopher Johnson’s, his views are ultimately based upon populist nationalism. Britain would cease to be an independent nation and parliament would resemble little more than a glorified county council under the jackboot of French and German bankers.

This may or may not be true. The question is what difference would this make to the working class? When people like John Redwood start talking about democracy it’s difficult not to laugh.

The main strengths of the “Eurosceptic” position rests on their critique of single currency economics. Firstly, they argue that Europe is not an “optimal currency area” which is a prerequisite for the Euro to be a long-term success. Britain’s trade cycle is synchronised more closely with that of the US and this could cause problems with a common interest rate policy (i.e. German growth may be slowing and Britain’s picking up). This could mean that the currency area was more susceptible to “asymmetric shocks” that could threaten the stability of the entire continent.

Left-wing Eurosceptics with their desire to reform British capitalism have also used “loss of control” arguments. The Campaign for an Independent Britain write in a recent pamphlet:

” . . . opting for economic self governance, rapid growth and full employment means opting out of a single currency” (Burkitt, Bainbridge and Whyman—There is An Alternative, p.65).

It is a supreme irony that left-reformists such as the aforementioned authors and Tony Benn can be on the same side as the Thatcherites, whilst denouncing the Maastricht “Convergence Criteria” and Amsterdam “Stability Pact” for being “monetarist” and “deflationary”. For these people are still labouring under the delusion that capitalist governments can control and influence the economy by using monetary and fiscal policies. They have learned nothing from history.

Clearly, the Tory Eurosceptics (currently under the leadership of William Hague) nominally support the notion of an independent Britain, but in reality represent the pro-US section of the British capitalist class. It is precisely this division between the pro-European and pro-US sections of the capitalist class that will fuel the single currency debate in the coming months.

Indeed, the EU and US seem to be in a perpetual trade war at the moment and such tensions are likely to increase rather than diminish. This makes Britain’s future role even more interesting. If Tony Blair does take Britain further into Europe, how will this affect Anglo-US relations? Perhaps Blair’s strategy will be to play one bloc off against the other?

We have seen the poverty of all the capitalist arguments for and against the Euro and located this debate in its true context. From the petty nationalists to the more “sophisticated” pro-Europeans this is not a debate for the working class. To be “pro-European” or “anti-European” is to fall for capitalist trickery. We should create our own agenda rather than just responding to our masters’ in-fighting. Is the Pound worth saving? A better question would be: Is capitalism worth saving?

Dave Flynn

What a Spectacle (1995)

From the August 1995 issue of the Socialist Standard

Despite the media’s pathetic attempts at convincing us all that the Tory leadership tussle was of world-historical importance it had all the attraction of a bad Punch & Judy show

Some years ago (1967, to be precise) Guy Debord wrote a book entitled The Society of the Spectacle which was fascinating in almost every respect except one: its virtual unreadability (a rather major failing in a book, it must be conceded.) The thesis of the book, which made it so compelling to try to read, was that society was becoming increasingly a spectacular performance, with most people merely onlookers upon everything from urban life to political conflicts.

Rarely has this notion of the spectacle been more apparent than in the recent third-rate theatricalities of British politics. The resignation of John Major in order to make way for himself as successor had to be one of the all-time low-points of sham political duelling.

No sooner had Major resigned than we, as spectators, were treated to endless stories, presented as news, about who might replace him. Major, we were led to believe, was a dull and rather hopeless chap, but personally quite nice. His opponent, who did little to enhance the image of extraterrestrial life-forms, was shown to us as bright but personally brutal. Then, after Act One which was to be dominated by The Two Johns, we were being prepared for the (ultimately unperformed, but well rehearsed) Act Two starring The Two Michaels: one an ambitiously rich brat and the other a man about whom it is impossible to say anything personal which will not be libellous.

But who knows anything about these people personally? And who wants to? What difference does it make if Major does eat his peas with his knife and Portillo is a smarmy backstabber? Even if these things are true (and they may not be: Major may well be as vicious personally as his policies are and Portillo might weep at bullfights), what possible relationship has this to political power? It is simply bad theatre.

As if to rub in our role as spectators, the election to determine who would be Prime Minister was one in which votes were only given to Tory MPs. So, as millions watched on, instructed by Dimbleby and his pathetic crew to recognise Punch from Judy and to favour one against the other, none of the hapless spectators even had a vote.

As for the barmy SWP, ever eager to chant for Major to be Out Out Out so that their lip for the top, Tony Blair, can be In In In, they were in quite some difficulty. Believing as they do (and as all Leninists must) that workers should be encouraged to support the lesser evil (thus leading them to support Iran against Iraq, Prescott against Blair and now Blair against Major), ought not political logic have persuaded them to support Major against Redwood? “The Central Committee calls upon the proletariat to support Major without illusions... “ But then, given that their real reason for telling workers to vote for Blair is to teach the suckers how bad life will be under a Labour government, why not support Redwood to teach workers just what it would be like to live under a right-winger from Outer Space?

At 5 p.m. on The Big Day millions were glued to their sets, hoping that something unpredictable might happen. In the event the highly predictable happened and the Tories did what they are good at doing: uniting behind anyone who looks like he will do them the least damage.

In the months approaching most elections the spectators are whipped into a sense of futile expectation, as if by electing a new government, which itself will be governed by the capitalist system, something might change. The run-up to the next election must be the dullest and most predictable in decades, with apparent certainty as to who will win and indifference as to the outcome on the grounds that the nearer Labour comes to victory the further it goes out of its way to convince Tory spectators that the victory' will be theirs.

To be a spectator upon history is to become dehumanised, for it is the historical consciousness of humans which makes us unique. Appealing to lemmings to avoid cliffs is a pointless exercise, and the most intelligent dog can only sit back and watch Crufts without any knowledge that it has ever been staged before. But for us, with minds which reflect and make history, to sit on the sidelines and observe the passing show of capitalist political foolery, is to abandon the weapons which could free us from the Redwoods and Deadwoods and Blairs and Blurs and fancy-dress Lenins who preside over our stunted lives as wage slaves.

We are makers of history, not spectators. When the change from capitalist insanity to production for need comes about we will not be watching it on the box. We will not be following leaders or waiting for the revolution to be announced from a podium. The socialist revolution will be the activation of human consciousness, transforming us from viewers of the spectacle to makers of the future. When will socialism rule? When the majority decide that they will no longer be ruled by others.

Steve Coleman

Greasy Pole: Throwaway Minister (2016)

The Greasy Pole column from the February 2016 issue of the Socialist Standard

'Where’s fookin’ Menzies?... Come on, where is he?... just to let you know, I’m not fookin’ having’ it…’ was how Labour Deputy Leader John Prescott warned Tony Blair about the rumours that the Lib Dem Leader was to be included in the government. And some years after that… ‘the meeting was friendly enough. He ended up offering me just about every job that was going – including the Foreign Office – except the one that I held. I said no’ – which was not John Prescott but Chancellor of the Exchequer Alistair Darling discussing with Gordon Brown the Labour Leader’s plan to replace him with his favourite Ed Balls.

Eton And Cambridge

It is habitual for political leaders when they are imposing the disciplines of exploitation upon the rest of society to resort to an individual style of expressing themselves, in words as well as actions.  An example  is Oliver Letwin,  who is now the Chancellor of the Duchy of Lancaster with a history of episodes as Shadow Secretary of State for the Environment, Home Secretary, Chief Secretary to the Treasury and Chancellor of the Exchequer. Politics has always been part of the Letwin family’s expectations; his father became Emeritus Professor at the London School of Economics and his mother has been described by a close friend as ‘humourless and energetic, argumentative and exceedingly right wing’. It was a family unlikely to place their child at a local state school so little Oliver had to learn about life and impoverishment at Eton. He then went to Cambridge where he joined both the Liberal Club and the Fabian Society – a conflict not made any more digestible by his apology: ‘I am sorry to have to tell you that this was because I was interested in the thoughts of Liberals and Fabians (and still am) rather than because I was ever a Liberal Democrat or a Fabian’.

Broadwater Farm 

Letwin’s first attempt to get into Parliament was at the essentially London Hackney North and Stoke Newington, against  Diane Abbott who was even then a rebel notorious enough for him to protect his ambitions by moving  in 1992 to Hampstead and Highgate, although that was where  another charismatic woman – Glenda Jackson – was entrenched. After all that effort he was probably due for a better prospect and he was given the chance at Dorset West but by the time of his first contest there, in 1997, he had a reputation for serial blundering so that his first majority was down to 1840. Among the earliest of his gaffes in 1985, when he was in Thatcher’s Policy Unit, was to support the vote-haemorrhaging Poll Tax. Although he was liable to be on the receiving end of a barrage of eggs if he spoke up for it in public, Letwin recommended that Scotland should be a ‘trail-blazer’ so that the tax could be used throughout the country if ‘the exemplifications prove… it is feasible’. Another disastrous piece of his work at that time was his part in commenting on the Broadwater Farm riots of 1985, when PC Keith Blakelock was killed. The riots were sparked off by the death of Cynthia Jarrett while the police were searching her home in Tottenham and were a predictable outcome of the particular poverty and despair of that area of London. But Letwin was joint author of an assessment that the cause was ‘solely by individual character and attitudes… new entrepreneurs will set up in the disco and drug trade… refurbished council  blocks will decay through vandalism  combined with neglect…’ This report was at first restricted as private; when it was released in December 2015 Letwin admitted  that ‘some parts’ were ‘badly worded and wrong’ and he apologised for ‘any offence these comments have caused’– the impact of which must have been diminished by the thirty year gap since the riots .

Hapless

Another of his efforts at joint authorship was in 1988, with John Redwood, of a pamphlet which justified the subsequent privatisation of the NHS, by both Tory and Labour governments and preceded his proclaiming that ‘The NHS will not exist under the Tories’. But the results of his efforts as one of the key advisers to Tory governments have not always been as he wished. During the 2001 general election he advocated a £20 billion reduction of the proposed Labour government’s spending. This was regarded as regressive and socially harmful, to the extent that Letwin feared his standing was under threat. He went into a period which Alistair Darling recounts as ‘A hapless Tory shadow minister, subsequently a member of the Tory cabinet, had played into our hands in 2001 by suggesting that the Tories really wanted to cut £20 billion from public spending. He went into hiding. The whole election campaign was dominated by the media search for this man. Oliver Letwin was finally tracked down at a garden party dressed in a Roman toga. We could not have paid for such a boost to our campaign’. The incident was reflected during the election when Letwin’s majority was reduced to 1414, classifying  the seat as marginal to a threat from the Lib Dems. In April 2011 he blurted to Boris Johnson that ‘We don’t want people from Sheffield having cheap holidays’- which may, or may not, have referred to Sheffield MP Nick Clegg.

Sensible

Among  his posturing and threats about the behaviour of others (provided they are not from the ruling elite) in October 2011 Letwin dumped a batch of papers,  including personal and other security matters, in a waste bin in a public place, as exposed when he was photographed in a park close to Downing Street. This was at first excused on the grounds that he was in the habit of rising early, going to the park and dealing with some of his paperwork there. It did not take long for this defence to be shredded, when details of the contents of the documents, some of which were seriously sensitive, were revealed. A spokeswoman for David Cameron had to concede that ‘Clearly it’s not a sensible way to dispose of documents’. Except that it has not been just documents which Letwin has disposed of during his career in power.

Ivan