Editorial: The Fuel Tax Dispute (2000)

Editorial from the October 2000 issue of the Socialist Standard

The fuel blockades last month—which threaten to return unless Gordon Brown cuts excise duty in the next few weeks—brought the operation of capitalism in Britain to its greatest point of crisis since the 1970s. Everyday life and the functioning of the emergency services were threatened in a way not seen since the dark days of the Winter of Discontent during the last Labour government.

This time it was not the organised working class in the trade unions that was battling the government. Instead, it was a tiny group of small businessmen and farmers who, without ballots and for the most part acting unlawfully, decided to try and hold the government and then other sections of the owning class—such as the oil companies—to ransom. Through receiving majority public support for their stand against fuel prices they were able to bring the country to a near standstill.

Looked at in the round, there are a number of points to be noted about this action:

• The protestors were only able to make headway because they received the tacit support of the bulk of the working class—including (for the most part) the oil tanker drivers
• The police did not immediately move against the protestors (who were guilty of secondary picketing, obstruction, a variety of road traffic offences, and periodic intimidation) until ordered to do so by the government, in sharp distinction to disputes like Grunwick, Wapping, and the Miners’ Strike. While at Wapping, thousands of pickets didn’t manage to stop a single Murdoch rag leaving the compound, a few hundred small businessmen from the shires were allowed to act with impunity in this dispute until Blair was forced to get tough with the police and oil companies so that the tankers could get rolling again
• That the government, with its control of the repressive agencies of the state machine, would ultimately have won out in the name of upholding “democracy” and “law and order”, even if the short-term damage was severe
• That the government has been hoisted by its own petard in being forced to blame high petrol prices at the pumps on the operation of the world oil market and the spiralling price of a barrel of crude—in other words the normal operation of the market economy, whose infallibility they previously lectured everyone else about whenever possible
• That the fuel protestors were not acting in the interests of the working class as they claimed, but in their own narrow economic and political interests. Many have been part of the so-called Countryside Alliance and many more have been bitter opponents of the working class movement at every turn (e.g. the haulage companies that crossed picket line after picket line during the Miners’ Strike).

None of the parties to this dispute have come out of it with any credit, and it has not been a dispute for the working class to get involved in. The real determinant of working class livings standards is not the operation, or precise level, of any one particular tax (and the government are always most likely to pay for reductions in one tax by raising others anyway) it is the overall level of economic activity and the ability of the organised working class to increase its living standards on the wages front. While oil companies try to pass fuel taxes on to the general population through higher prices, the workers tend to pass them on to the capitalist class as a whole through increased pay claims and subsistence payments made by the state, which is why taxation generally is ultimately a burden on the owners of capital rather than the non-owners.

If there is to be a battle against the government within capitalism for a better standard of living the wages front is the arena to fight it and where intervention by the organised working class can pay real dividends. And this is the arena where the workers, democratically organised, are most likely to come into conflict with all sides in this current dispute – the government, the multinationals and the whingeing petty capitalists too.

Material World: Sri Lanka – the limits of workers’ forbearance (2022)

The Material World column from the August 2022 issue of the Socialist Standard

Sri Lanka long had a stable economy but the Material World column in March drew attention to the economic chaos taking place there.

Since March the situation has spiralled even more out of control. Sri Lanka’s rupee has lost more than 80 percent of its value and is still falling. Its foreign exchange reserves for all practical purposes have been depleted. Without US dollars the country cannot afford to pay for imports. Petrol has run out for non-essential users and is rationed in favour of the emergency services. Without fuel for cars and public transport via buses and tuk-tuks not running people cannot go to work or operate their businesses. LPG gas for cooking is in short supply. Fishing boats can’t go to sea, because they don’t have diesel.

All attempts to find solutions have failed which has now culminated in political turmoil with the prime minister’s home being set alight by angry demonstrators and the president forced from office as protesters occupied the presidential palace.

The financial crisis is also a health crisis. Sri Lanka imports more than 80 percent of its medical supplies. Now medicines are in short supply, including essential, life-saving drugs. Only the most critical patients are being operated upon. Doctors who once could say that the country possessed very fine healthcare, now tell of people dying due to lack of resources. Sri Lanka’s hospitals now rely on what charity other nations can offer.

In May a $1.5 million donation came from Japan so that UNICEF could procure medicines for over 1.2 million people, among them 53,000 expectant mothers and nearly 122,000 children with immediate medical needs. Australia sent food plus essential medicines for women’s health, the equivalent of nearly $5 million.

In June the UN appealed to international donors for more than $47 million in ‘life-saving assistance’. To put it in perspective, the government at the time said $5 billion was required for the island’s economic survival primarily to pay for food, fuel and fertiliser.

Ordinary Sri Lankans continue to bear the brunt of the financial and food crises. Sri Lankans under normal conditions did not lack for food, but the UN World Food Programme reports nearly nine of 10 families are skipping and skimping on meals, with 3 million requiring emergency humanitarian aid. Inflation of food prices was 22 percent in December 2021, 30 percent in March, and 57 percent in June resulting in people unable to put enough food on the table for their families. Now inflation is expected to go higher to 70 percent in coming months. A kilo of rice now costs 500 Sri Lankan rupees when it previously cost less than 100 rupees. The price of essentials means they are beyond reach for many people. Once unthinkable, Sri Lanka may now be facing food insecurity, if not outright famine, in a few months’ time.

Fuel shortages mean electricity cuts, with transport and supply chains being disrupted. Factory closures and unreliable shipment of exports have led many global brands to turn to alternative suppliers, such as Bangladesh and India, leaving Sri Lankan workers without jobs and pay.

Discontent and unrest had been widespread for months across Sri Lanka but the magnitude of the protests that forced out the government, once more demonstrated the latent power of working people. What we witness in Sri Lanka arose to a degree from mismanagement and malfeasance yet it is not unique and similar situations will most likely occur in more and more countries. Global price rises have inflicted similar pain elsewhere.

Lebanon’s GDP halved, from $52 billion in 2019 to $21.8 billion in 2021. Foreign exchange reserves dropped from $30 billion in 2019 to $11 billion today. The Lebanese lira has lost much of its purchasing power with salaries no longer sufficient for employees to support their families. Workers are barely able to buy basic necessities. Lebanon’s poverty rate is now over 74 percent and nearly 2.2 million of the population are lacking food security. One third of the population in the country is unemployed and according to the International Labour Organization nearly all public sector employees are engaged in various levels of industrial action.

The UN warned that food scarcity and malnutrition in the country would intensify further in the coming months and its representative in Lebanon, Najat Rochdi, expressed concern that the grain and fuel shortages arising from the Ukraine conflict were already affecting the country.

Sri Lanka and Lebanon are not isolated examples of capitalism’s failures to maintain stable social safety nets. Global inflation is inflicting economic pain across all continents and we can expect similar civil strife to occur in many more countries, and more governments to topple.

Politicians and the capitalist class in other countries received a warning sign in Sri Lanka that there is always a limit to workers’ forbearance. Desperation can so easily turn into rage and revolt. If a country’s economy sinks, its working class will not willingly go down with it.

ALJO

Direct action: reformism by blows (2000)

From the November 2000 issue of the Socialist Standard

The Five Days That Shook The Labour Government in September should have given the advocates of "direct action" to further the interests of the environment, animals and disadvantaged groups something to think about. Other minorities can play at this game too and some of them can wield this weapon much more effectively in terms of disruption caused and notice taken. In a battle to "reclaim the streets" between environmentalists and their bikes and failing businessmen and their lorries and tractors who will win?

Sectional interests

The fuel tax protest by lorry owners was clearly a purely sectional issue with one group of small capitalists trying to shift, by direct action, the burden of taxation from them on to other sections of the capitalist class. No wonder the government, as representative of the general interest of the capitalist class as a whole, felt that it had to stand firm and insist that this was not the way to decide how the tax burden should be shared amongst the various sections of the owning class. If they conceded on this one, who would be the next sectional interest to try the same tactic (as the weaker, or less far-sighted, French government discovered)?

The government stood firm and the lorry owners did back down, realising that they were in no position to win a full-scale trial of strength with a government able to mobilise emergency powers and the armed forces. Nor was it in their interest to set a precedent by toppling an elected government. Knowing this the blockaders' leaders were shrewdly able to turn their retreat into a propaganda victory by quitting before the state moved against them and while they still enjoyed a high degree of popular support.

That popular support, however, was not for their sectional interest of saving their failing businesses but for the idea of bringing petrol prices down by reducing the tax on fuel. This tax is, technically, an excise duty, i.e. the government establishes an artificial monopoly which allows the oil companies to sell their products at a monopoly price; only they don't get to benefit from this as the government creams off the resulting extra profits as the tax. The oil companies really are, as they protest, only collectors of this tax for the government. Actually, the price of petrol has gone up, but largely because the basic pre-tax price has. Having said this, a reduction in the tax would of course bring the price at the pumps down to some extent. Lorry owners and the motoring public would be happy but the government would find its revenue cut and, to maintain its expenditure, would have to increase some other tax. This is why it can be said that what the lorry owners were trying to do was to shift the burden of taxation from them to some other section of the owning class.

 Only the Greens made a stand against the demand to reduce the duty on petrol; if anything, they want it increased so as to discourage the use of petrol- and diesel-burning cars and lorries. They have a point. Burning fossil fuels is not the best use that could be made of them. The individual motor car has become an irrational means of getting to work—and, increasingly, even getting around—in urban areas. Long-distance freight should be carried on the railways. A comfortable, efficient and comprehensive public transport system is the rational answer. All this is true, but the problem is not going to be solved under capitalism where what happens is not decided by what is in the best interests of the community since there is no community but by the play of market forces supplemented by the lobbying of sectional interests. It is certainly not going to be achieved by "green" taxes and subsidies as advocated by the Green Party. What is required in fact is a complete change in the basis of society to create a real community through ending the division of society into classes by establishing common ownership and instituting production purely to satisfy human needs instead of for sale on a market with a view to profit.

The visionless thing

But talk of a "complete change" in the basis of society is precisely what is rejected by the campaigning charities and environmentalist activists. This wasn't always the case. In the not-so-distant past both the Labour Party and then the Green Party did talk in terms of changing society True, this was only as a long-term prospect, but the idea of an alternative society was there. Now this has gone and those of us who are left proposing this are denounced as "unrealistic" for continuing to advocate a "big solution" when supposedly there is none.

Isn't there? Let's suppose for a moment that there isn't. What would that mean? It would mean that we'd have to continue with what we've got—capitalism, to give it a name, if that's not too "ideological"—and try to make the best of it, as individuals and as sectional interests. Political parties have already become rival groups of professional politicians with virtually identical policies and certainly identical practices, offering themselves as the best managers of the system. So it would mean that politics would be reduced to pressure group politics as different sections of the population tried to persuade governments—whichever the party in power—to make changes in their particular sectional interest or, in the case of campaigning charities, of the disadvantaged group they have chosen to champion. Political action would consist of lobbying, backed up from time to time by direct action, for reforms in the sectional interest of some group.

This is not an attractive prospect but it is one that is, somewhat surprisingly, championed by a number of people who are severely critical of capitalism. What they like is the idea of "direct action" as such. This, they think, is the way to get improvements; electoral action via local councils and parliament, they say, doesn't get you anywhere. But "direct action" is merely a method, a tactic, not an end in itself and can in fact be employed for different ends. In the present political context it is being advocated as a better way to get reforms than elections. May be it is, but maybe it isn't. One powerful argument as to why it might not be has just been demonstrated: those with the biggest vehicles can reclaim the streets more effectively than those without. In other words, with direct-actionist, pressure group politics, those who can exert the most pressure will tend to come off best, and it is the more powerful who can generally exert the most pressure.

 In any event Socialists don't get involved in this argument because it is one amongst reformists as to the best way to obtain reforms while we seek to end capitalism not reform it. Our view is that those who concentrate on trying to obtain reforms within capitalism—whether by direct action or through the electoral process—are on the wrong track. What is needed is precisely what most of them refuse—and in fact have consciously rejected doing—and that is raising the issue of an alternative society as the only framework within which the problems for which they are seeking short-term relief can be solved.

Adam Buick