Bank of England Swindle (1958)

From the February 1958 issue of the Socialist Standard

A Shabby "Tribune" Stunt

Professional politicians put over so many impudent stunts, made possible by the short memories of the electors, that they understandably grow careless and expect to get away with murder. But surely they cannot perpetrate the same swindle twice in a dozen years? It seems that Tribune, “Labour’s Independent Weekly,” is confident that they can. Its stunt at the end of 1957 was to launch a campaign for the next Labour Government to “take over the Bank of England.” Its issue of 20th December, 1957, carried the bold, front-page headline: “Let’s Nationalise the Bank of England!” with the sub-heading: “You thought we had done it already? You were wrong.”

Who Led the Workers Up the Garden?

As a fact, of course, the Bank was nationalised in 1946 by the Labour Government's “Bank of England Act.” So when Tribune comes along now and pretends that it wasn’t, it is a piece of trickery, designed to cover up the blatant failure of nationalisation to make any difference to the workers. The nationalised Bank is no more popular with the voters than was its privately-owned predecessor under Montague Norman, and Tribune is trying to lay the blame for the failure of Nationalisation on other shoulders. But the responsibility rests squarely on the Labour Party, including the group behind Tribune, who, as M.P.s or Ministers, fully supported that Act in 1946. It was they who told us what a fine thing it was going to be; an instalment of Socialism, they said. It was they who spoke and voted for the Act and later boasted of its “success” when they fought the next election in 1950. Bevan and Mikardo were two of those who voted for the Act, and neither they nor any others got up, in the House or outside, to say that it was a fraud and would not make a ha’porth of difference to the workers—that was left to the S.P.G.B. to say.

It is only now that Tribune, in effect, admits that the Act changed nothing.

Then the story was different. Typical claims made by Labour Ministers and M.P.s (backed by the Tribune group) were that the Act had given the Government “undivided control ”; which was said to be “helping the Government to maintain full employment and to further economic recovery” (Labour Party, Speakers' Handbook, 1949-50, page 115). And: “The Bank is another industry under public ownership which is both serving the national interest and paying its way.”

When the Act for Nationalisation was being voted in Parliament the Labour Chancellor of the Exchequer, Mr. Dalton, rapturously declared that “it is a model It will, in due course, make a streamlined Socialist Statute” (House of Commons Report, 29th October, 1945).

"Tribune's" Charges

To the thoughtless reader who has forgotten what happened when the Bank was nationalised Tribune's slashing charges may make convincing reading. How telling for Tribune to point out that only one of the 18 directors “comes from the trade union movement”; that 15 of them went to those “well-known nurseries of privilege,” Winchester, Marlborough, Rugby and Wellington; that “ten of the eighteen spend only a small part of their time at Threadneedle Street. The rest is devoted to running some of Britain's most powerful industrial and financial groups.” And is it not true, as Tribune says, that these, part-time directors, “are bound to think and act as businessmen and there is' plenty of doubt whether what is good for capitalism is good for Britain.”?

Tribune (20/12/57) publishes the photon of ten of these part-time directors of the Bank with the caption: “They’re all Bank of England directors and City men!”

Fine virile stuff, you think ? But it is less than half of the full story. Let us now look at the rest

What "Tribune” Keeps Dark

Of course it does not really matter whether the men in charge of a capitalist institution came from the coal mine and the elementary school or from Eton and Winchester, but Tribune now pretends that it does and the innocent reader may think that the selection of men from those public schools is a nasty Tory plot. But Mr. Dalton, who piloted the Nationalisation Act through the Commons went to Eton, and one of Winchester’s proud sons is Mr. Gaitskell, present leader of the Labour Party, whom Tribune will be supporting at the next election. And who is responsible for many of the directors being part-timers (as if that mattered either)? The answer is that the provision for part-time directors is in the 1946 Act that the Tribune group then supported. And is it true that ten of them have other business and banking interests? Sure it is, but so it was when the Labour Government (including the Tribune's idols) appointed the court of governors in the years 1946-1951. Seven of the men now named by Tribune (L. J. Cadbury, Sir John Hanbury-Williams, Basil Sanderson, Geoffrey Eley, Lord Kindersley, Michael Babington Smith and Sir Charles Hambro) were actually appointed directors in the first place by the Labour Government—supported by Tribune. So that everything that Tribune lists as items in the present spurious campaign about the Bank of England was true also in 1946-1951 when Tribune was backing the Nationalisation Act and the Labour Government that carried it through. The only change is that then they were promising what great "socialist” benefits it would bring and now the voters don't believe this any more.

Trick in Preparation for the Next Election

Tribune now declares that control of the Bank of England is not in the hands of the Government but is “kept in the hands of a formidable team representing the Minority rent, interest and profit class.” They say this is intolerable and must be put right; presumably at the next election.

As we have already pointed out, the existing arrangements were created by the Tribune group and the rest of the Labour Party.

But the deception has another angle too. The Labour candidates and M.P.s who backed Tribune, fought the 1950 General Election on the Labour Party Declaration of Policy called “Let Us Win Through Together." It contained the following clause :-

  “Finance must be the servant and not the master of employment policy. Public ownership of the Bank of England has enabled the Government to control monetary policy. Subject to the will of Parliament, we shall take whatever measures may be required to control financial forces, so as to maintain full employment and promote the welfare of the nation.”

So Tribune were telling the electors in 1950 that the nationalisation of the Bank of England, already five years old, had “enabled the Government to control monetary policy.” Now they say that control is really in the hands of a group of capitalists, yet this very group were put there, as directors of the Bank, by Tribune's political friends! And the Labour Government, returned again to power in 1950, kept the same arrangements in being. Now Tribune says that the Bank of England is “run by the same old crowd as before,” that is by the crowd they put in control! Could humbug go further?

Bits of Socialism

When the Labour Government nationalised the Bank of England the S.P.G.B. stated that it was no concern of the workers and nothing to do with Socialism. Tribune, of course, was telling a different tale. Now Tribune largely admits the truth of what we said :-

  “What has actually happened provides a classic illustration of the failure which follows from the attempt to insert a small element of Socialism into institutions left in capitalist hands—the very doctrine since revived by the Labour Party Executive in Industry and Society. The small dose of Socialism is quickly swallowed up in the capitalist mass and nothing is changed.”

Of course as a statement of principle this is true, you cannot insert bits of socialism into capitalism, but for Tribune to say so is humbug. They were believers in that futility in 1946, are in favour of it now, and will be asking the workers to vote for it (and for the ex-Winchester leader of the Labour Party) when the next election comes.

What is more, the Tribune writer takes care to let us know that when he talks about Socialism it is with his tongue in his cheek. If he were a Socialist he would know that Socialism will have no use whatever for the financial banking, and currency machinery of capitalism, including its central organ the Bank of England. Yet the forefront of his demand on the next Labour Government is that it shall make the directors full-time instead of part-time; as if the difference between the capitalism that we have and the Socialism socialists want, is a question of the number of directorships capitalists shall hold.

If Tribune were interested in Socialism it would know that the way the Bank of England is owned, controlled and administered is a concern of the capitalist not of the workers, but Tribune couldn’t care less.

Here's hoping that at least some of Tribune's readers have long memories.

Edgar Hardcastle