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British Perspectives 2013: a Socialist Party congress document
British Perspectives 2013: a Socialist Party congress document
1. As 2013 begins many political and economic commentators have suggested that 2012 was a 'groundhog year'. "British politics has got a bit stuck", declared Andrew Rawnsley (Observer 30 12 12).
While this was true on the surface, in reality society, and particularly the working class, underwent profound changes in 2012 which will accelerate in the coming year.
The economy was also described by the Institute for Public Policy Research (IPPR) as having, "stood still for the last 12 months".
For the majority in society, however, this has not meant stagnation in their living standards but a significant further fall.
2. In 2012 the majority of the working class, and wide sections of the middle class, suffered a battering.
An avalanche landed on our heads, including benefit cuts, dramatic cuts in local services, hospital closures, the implementation of the government's attack on pensions, the headlong rush to turn schools into academies.
All of this, however, is still only about 20% of the government's planned cuts. At the same time a majority of households saw a marked fall in their income.
As the Bank of England's chief economist, Spencer Dale, noted: "The harsh but inescapable reality is that households and families are worse off - much worse off."
The ONS statistics say that average wages rose by an annual rate of 1.7%, compared to an official inflation rate of 2.7%, meaning that average pay has fallen by 1% in the last year.
This is according to the government's 'preferred' CPI index of prices, rather than the RPI traditionally used by many unions, which showed a 3.1% rise on an upward trend (see footnote for more) .
This comes on top of years of belt tightening. The Bank of England estimates that the pay packet of the average worker is now worth 15% less than it was in the pre-crisis period.
3. No wonder that Christmas spending was down. Increasing numbers of people cannot afford the necessities.
Three new food banks open every week and the number who had to go to food banks over Christmas doubled.
Since the recession began people are buying 20% less fruit and vegetables, and far less milk, bread and fish.
The Children's Society reports that 72% of teachers have pupils who not only skipped breakfast, but had no lunch or the means to pay for one.
It should be no surprise that cases of rickets, previously considered a disease of a long-gone Dickensian past, have increased fourfold.
4. The government has had two stated aims for all the misery it is imposing - eliminating the deficit and maintaining Britain's AAA status.
As we predicted neither will be achieved. Osborne is being forced to endlessly move back the target date for eliminating the deficit, now to 2018.
And now all three major credit ratings agencies have given official warnings that Britain can expect to be stripped of its AAA rating.
While no surprise to us, this is a blow to Osborne's campaign that cuts are necessary for the good of the economy.
5. The 2012 budget, particularly the cut in the top rate of income tax, was a tipping point in how the majority, including most of the middle class, perceived the government.
It is now widely seen as a government of the rich. Andrew Rawnsley summed up the mood with 'one of 2012's best political jokes': "Why did 80,000 people boo Osborne? Because that's the maximum capacity of the stadium."
At the same time the conspicuous consumption of the ruling elite is creating a burning rage.
The Sunday Times rich list has reached record highs in 2012. The combined wealth of Britain's richest 1,000 people swelled by almost 5% to £414 billion, reaching the highest amount ever recorded by the 24-year old survey.
6. The revelations of major well-known corporations avoiding paying their taxes has fuelled that anger, forcing even Cameron to be seen to attack them as "lacking moral scruples".
What hypocrisy! Osborne's determination to make Britain "the most competitive corporate tax system" in the world has meant that, according to the Office for Budget Responsibility (OBR), corporation tax receipts will fall from 7.5% of total tax revenues to 5.8% in 2017-18.
And in addition to cutting headline tax rates, the government has been actively assisting tax avoidance.
When they were elected they seconded a senior manager in international corporate tax from accountants KPMG to the Treasury for 20 months to see through developing the policy on rules for multinational companies.
His speciality at KPMG? Advising multinationals on tax avoidance! Not only corporate tax lawyers, but representatives of the energy corporations have been brought into Whitehall by the government.
7. That the growing class anger in Britain was not fully given voice in 2012 was primarily as a result of the failures of the leadership of the trade union movement.
As a result the latest round in the war against austerity was another defeat for the working class. It was huge pressure from below, channelled by the National Shop Stewards Network (NSSN) in alliance with the RMT, PCS and Prison Officers Association (POA), which led to the TUC congress taking the historic decision to back the POA resolution 'to consider a general strike'.
Afraid of appearing conservative to their own membership, even the right wing leadership of UNISON backed the motion, while openly admitting that they did not really support it.
Since then, thanks primarily to the general secretaries of UNITE and the RMT, Len McCluskey and Bob Crow, attempts by the leadership of the TUC to rule out a general strike have been blocked.
Unions are currently being consulted on the possibilities of a general strike and we have to campaign for positive responses from as many unions as possible.
However, we also have to recognise that, at this stage, only the PCS has concrete plans to ballot for strike action, and to call for other unions to co-ordinate their action alongside them.
It is likely to take further pressure to force wider co-ordinated action. However, a 24 hour general strike is firmly on the agenda, although it could be delayed, possibly for longer than many expect, because of the right-wing trade union leaders dragging their feet.
However, even if this was the case our party can still make gains as a result of spearheading a campaign for a 24 hour general strike.
We can increase our authority among key sections of workers as well as recruiting a layer of trade union militants, preparing the ground for much larger scale recruitment on the basis of events.
8. As the events of the last two years have shown, the working class will find the means to fight back despite the faults of its leadership.
The question is not whether or not there will be struggle but whether that struggle is organised into a powerful force or will be inchoate and disorganised due to lack of leadership.
Lack of leadership can also lead to struggles developing on a sectional or local level, without the workers involved, in the short term, necessarily understanding the need for making common cause with other sections of the working class or, where they can see the need, not being able to find a route to do so.
The government has temporarily succeeded in increasing the divisions in the working class, particularly between workers and the unemployed, and can also attempt to exploit other divisions, such as along racial or gender lines, or between the public and private sector, and the employed and retired.
Nonetheless, Britain has entered a protracted period of class struggles, as the working class attempts to resist endless austerity.
This flows from the continuation of the economic crisis, the worst British capitalism has faced in at least 80 years, possibly ever.
The situation in the world is dealt with in the thesis agreed at the recent IEC of the CWI, which must be taken in conjunction with this document.
Although the CPI figure looks like it leads to a cut in real wages of 1%, in fact for those over 21 working 26 hours or more a week, the after-tax pay rise on the basis of a gross 1.7% rise would be at most only about 1.1% (even less, also counting in any additional pension deductions).
The official CPI annual increase of 2.7% also included rises in food and soft drink prices of 3.2% and in housing and energy costs of 5% (see www.ons.gov.uk: ONS CPI Briefing note dated 15 Jan 2013, page 6 ).
Bearing in mind both that these items are a higher proportion of expenditure in lower and averagely-paid households and also the higher RPI figure, it can be seen that the cut in real living standards continues apace at over 2% for very many households, even according to official figures. (We also need to take into account that the same percentage can mean completely different things, depending on the size of the original income.)