On Sunday May 8th, in London the seven-nation conference of heads of state ended. Present with their aides were the Prime Ministers of Canada, Italy, Japan, UK, the Presidents of USA and France, and the Chancellor of West Germany; and on the final day Roy Jenkins in his capacity as President of the EEC.
The Conference was the latest of a series of similar conferences to appraise and look for solutions to the very real and increasingly dangerous problems facing the West European industrial countries, North America and Japan, and the rest of the avowedly capitalist world, i.e. Australasia. Latin America and so on, plus and by no means least the primary producing countries of the “Third World”, who are themselves at various stages of industrialization.
The problems discussed were primarily the world trade recession, with its unemployment. particularly amongst the young, inflation, energy, imbalance in international payments, the expected $45,000 million surplus of the oil-producing countries grouped in OPEC, the debts of the developing (non-oil producing) states, the “necessary” increase in nuclear energy (and its attendant dangers, political and military), “aid” to developing countries in which the Eastern (Soviet) bloc trade organization Comecon was urged to follow suit.
Carter, the US President, also raised the question of illegalities which had hitherto been condoned in certain banking, multi-national business and political circles. (The former Japanese Prime Minister, Mr. Tanaka, in relation to bribes from the Lockheed Aircraft Corporation was very involved.) This latter matter was not mentioned in the final declaration of “7 Pledges” to revitalize capitalism’s ailing economies, possibly because although not unimportant, it was regarded as peripheral to the major problems. To raise it officially would have also meant an explicit reference to companies and individuals. But does the conference have any significance for the working class of the world?
It can be safely said that modern society rarely appears to have stability for more than about two consecutive fortnights at a time, and that countless conferences and meetings have come and gone. Like many things it is all relative . . . and yet the newspaper headlines must at least have indicated something of magnitude — e.g. “7 Pledges to stop chaos” (Daily Telegraph, 9th May) and the politicians’ view on what could happen if these problems are not solved, must mean something. Put it this way: Carter, Callaghan and the rest wish to present as good a face as possible on the existing system whether they choose to call it capitalism, the “mixed economy”, a “free market”, a “social market” economy, the “free world” (i.e. capitalism with some sort of parliamentary democracy), partly because they are obliged to continue with it and also perhaps because they like the trappings of political power. As Carter said at the end of the conference: “We have to remember that making decisions, even unanimously, is not a guarantee that our decisions will be consummated. In many ways our own reputations are at stake.” As an article in the Daily Telegraph on Friday 6th May (the day before the beginning of the heads-of-state meeting) under the heading “Outlook for the World Summit — Hidden Threats to the World Economy” stated in its opening paragraph:
Chancellor Schmidt probably expressed the inner thoughts of all the European leaders when he said on Wednesday that he was looking to the London summit this weekend, mainly to bolster confidence. By this he meant the leaders' self-confidence and their electorates’ confidence in them, both of which are indeed at a low ebb.
Why this dual lack of confidence then? Because the politicians always aim to convince themselves and in turn the electorate that the capitalist system has found a way of stabilizing itself, and that despite its many imperfections it could at least avoid a catastrophe of the 1930s’ slump dimensions. They imagined that with their versions of Keynesian economics they had eradicated the deeper troughs of the business cycle.
However, from the mid-sixties onwards their policies have been demonstrated to be futile and unsound. It has been a gradual process, this dawning on the part of capitalism’s politicians.
Perhaps more to the point, among their advisors in the corridors of power, the higher echelons of the Civil Service, this bewilderment was exemplified in an article entitled “Whitehall at its wits’ end” (Sunday Telegraph, 24th April):
‘Everyone is baffled’ confesses one Permanent Secretary. “The old levers just don’t do the trick any more. We’re living in a world we didn’t make and don’t understand’. The Treasury has according to one senior Labour Minister (unnamed) ‘a very marked loss of confidence’, which reveals itself ‘to the discerning eye’ by the presence of competing economic ideologies. Before the Treasury served up only the pure milk of Keynesianism; now Keynes and Friedman are both on offer.
Graham Turner, the author of the article, states that “Whitehall is at its wits’ end . . . like the rest of us — they have not the faintest idea where Britain is going”.
The British politicians, their advisors and their counterparts in other countries may not know where the British and world economies are heading, but they do know, from personal experience and from the reading of history, where the 1930s’ crisis led.
The fact that they spoke at the Summit conference as candidly as they did demonstrates the seriousness of capitalism’s present difficulties.
The Japanese Prime Minister said “the world economic situation was now as serious as that of the early 1930s when leading industrial nations failed to act in time to prevent a slide into the 1939-45 war. History should not be allowed to repeat itself. Western nations had to co-operate more energetically in tackling economic problems” (Sunday Telegraph, 8th May).
He also recalled the fiasco of the 1933 London Economic Conference when no agreement was reached and a communique not even issued. “The difficulties today are greater and are compounded by new problems”.
The French President, Giscard d’Estaing. recalled that the ending of the 1977 conference coincided with the anniversary of the end of the 1939-45 war! “Sombre and pessimistic pictures were sometimes drawn of the present state of the world, but the cooperation at such conferences make it possible to avoid the mistakes [!] that helped to bring on that war.”
Helmut Schmidt of West Germany spoke on similar lines and “thought that they had avoided the results of complete selfishness” — by avoiding the “traps of the 1930’s.” President Carter like the other heads of state was concerned that decisions reached should not be merely pious, but recognized that making decisions and implementing them was not one and the same thing. "Sometimes heads of State tend to over-emphasize their own importance,” he said.
Callaghan considered that continuing unemployment carried political risks, not merely by the replacement of one party by another (naturally he does not want to lose his job) in Parliament — but that political democracy could be threatened. He is obviously concerned regarding the growth of the National Front, with racialism as the main plank of its support, and it is obvious there is a parallel here with the Nazis’ anti-semitism, which was copied in this country by the pre-war British Union of Fascists (although in recent years Sir Oswald Mosley has tried to obscure his organization’s former position on this subject).
It would seem inconceivable that the British working class could en masse support an organization tainted with fascism. Some of NF’s leaders were given to dressing up in Nazi-style uniforms before the organization was formed, and their arguments for economic nationalism — “self-sufficiency” — were advocated by the Nazis. However, it seemed improbable at the time that the Nazis would make much headway.
It can be justifiably argued that Britain in the 1970s, even with inflation and high unemployment is not the same as Germany in the early 1930s at the height of the depression with 6 million unemployed and the dire poverty it meant. However, in spite of the lower percentage of unemployed compared with that period and the lesser relative hardship of today’s unemployed, there is apathy and cynicism to politics and politicians generally, which though understandable is far from healthy — and also a good deal of resentment on the part of some of the young. This is why the established politicians are concerned wondering whether, if the crisis continues irrespective of the party in power, some of the youngsters might transfer their violent support from football teams to organizations like National Front. After all most of the workers of today know little of the 1930s; they make comparisons within this period, and as to whether the politicians’ promises and policies ring true. Over 400,000 of the present unemployed in Britain are in the 16-to-25 age group. In the rest of Western Europe the percentage is a little lower, and in the USA it is higher than in this country.
The major parties of British capitalism are discredited and the growth of the National Front directly arises from this. It is a particular indictment of Labour-style reformism and its inability to deal with capitalism’s problems, heightened as they are in times of crises.
Frank Simkins
(To be continued)
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