"Red, White and Blue Brexit"

In a little over 70 pages, Theresa May has confirmed the worst nightmare for Remainers. Not only is Britain leaving the EU, we are leaving the single market and the customs union too. This may mean immigration controls are being placed before economic growth. The political is being put before the economic. This is what she meant when she engaged in such sloganeering as “red, white and blue Brexit”.

Speaking at Lancaster House, May deployed the language of internationalism, Theresa May laid out the contours of the plan for Britain to leave the EU and become a “great, global trading nation”. She was careful to talk about diversity, multiculturalism and fairness. It was not a speech at a UKIP rally. Instead, May has tried to rearticulate the centre ground as a nationalist space.

In the aftermath of the June referendum, Britain was left in a state of shock. Even the Leave voters could not believe they had won, for many the vote was an opportunity to register their distaste with the establishment. Not many people expected Brexit to go ahead, certainly not in the Remain camp where people felt they had fallen into a parallel universe.

Nearly eight months on, the unknown is still here. It haunts us all every day. We voted for it, and we don’t know what will happen next. The pound has been degraded, and some people have lost thousands from their pension pots. Inflation and instability are on the rise. And this is just the beginning. The process has not even started yet.

Mayday, Mayday!

Electoral strategy has trumped economic stability. Withdrawing from the EU will allow the Conservatives to ward off the threat of UKIP and satisfy their own Eurosceptic backbenchers. The question of European integration has been a crucial question for Conservative administrations going back to Ted Heath. Those were the days when the Tories were passionate Europhiles.

Since then Euroscepticism moved across the aisle and became embodied by right-wing mavericks on the Tory backbenches. Despite her reputation as ‘anti-European’, Margaret Thatcher signed Britain up for the Single European act and took the country into the ERM before her resignation. Yet it would be John Major, whose government would be lacerated by infighting over Europe. David Cameron would offset the issue until 2016 when he finally held the referendum.

Unlike her predecessors, Theresa May wants to resolve the European problem once and for all. She hopes she can save face by taking Britain out of the single market and the customs union. May promises she can do this with minimal pain. This is akin to David Cameron’s promise to cut spending without hurting public services. It was wrong in 2010, and it’s wrong in 2017. But this is not May’s consideration.

Freedom of movement with the EU will come to an end, but it’s unclear what this may mean. Contrary to popular misreading, the end of free movement with the EU does not necessarily mean immigration will cease. May has already gestured towards a deal on EU nationals living in the UK, and for UK nationals living in the EU. The real issue is the economy’s need for more and more cheap labour as the population age and approach retirement.

One scenario is that the UK will continue to accept migrant labour and use the tax receipts to prop up its pension system. The government could still introduce new penalties to squeeze migration, turn away more refugees and continue to suppress wages. In another scenario, the UK restricts its border thereby reducing its own labour market and creating the pre-conditions to privatise the pensions system. In either scenario, the working class stands to lose out.

A Not-So-New Economy

One of the reasons why I doubted Brexit was possible was the loss of British manufacturing. If we’re going to weather the storm ahead we will need an industrial base as part of a viable economic strategy, yet this economic base was destroyed by four decades of Thatcherism. So, the industrial option no longer exists, the Conservatives are left in a tricky position.

There are few options on the table for any government right now. Before the Conservatives were simply trying to reflate the housing bubble – that flourished under New Labour, only to go pop in 2008 – as they tried to stripped the state down to the buff. The Cameron era is over, and the May government must chart a new course.

Unfortunately, the Tories have destroyed the other options, it looks like they are going to give supply-side economics another try. Thus, Chancellor Philip Hammond has suggested the UK should slash taxes for the rich and take a hatchet to what little regulation is left. Who will pay for this? Everyone who depends on benefits, state schools, the NHS and state pensions. It’s all up for grabs now. The profits must be extracted from somewhere.

More important than growth, the system needs to facilitate the accumulation of capital. It’s a mistake to think the capitalist buzzword is ‘growth’. The neoliberal period is marked by low growth rates in many cases. The average rate of growth in the 1970s was 2.2%, and under Thatcher it was 2.2%. All that changed was the distribution of growth. Profitability was restored by the defeat of organised labour, whose demands for high wages were eating into revenue.

At the same time, Trump says he wants to cut a deal with the UK once in office. Expect the free trade deal to mean a “bonfire of regulations” presided over by the Treasury. It could be worse than TTIP. You can imagine an unprecedented pig-out by the rich, in which the NHS, state pensions and education, are all eviscerated and served up on a silver platter. This isn’t to say the Tory government wasn’t going to do this anyway.

All of this as the country is hit by the consequences of a falling pound and little to export. The trade deficit is already massively bloated, whereas financial capital is the only thing going for the economy. This is likely just the beginning of a very bumpy ride.

This article was originally written for Spectre.

Will Putin fall?

The combination of economic sanctions and oil prices have led to the currency crisis in Russia mutating into the greatest crisis for Putin to face. The question which observers should be pondering is whether or not Putin will survive this storm. This is why I felt it necessary to write on the new crisis in Russia:

Putin’s brand of national capitalism, not to be confused with a neoliberal market economy, faces the greatest challenges in its short history. Economic nationalism meant the combination of a flat tax regime, land privatisation, state management of resources and protectionist measures to maintain industry. Oil revenue allowed Russia to secure growth and pay off its Soviet-era debt. But the nationalist push against international capital inevitably comes up against the limits of its own barriers.

Russia has a strategic interest in keeping Ukraine out of the EU-NATO orbit, but this doesn’t mean it produces results for its economy. On the contrary, the invasion of Ukraine and annexation of Crimea led to diplomatic and economic pressures being brought against Russian institutions. The sanctions converged with the collapse of oil prices, as OPEC maintains output, confident that it will break even sooner rather than later. The rouble is unstable, sanctions are beginning to cripple international trade, and the economy is logically contracting.

The full article can be read at Souciant.

Tony Benn - He Encouraged Us.

You've all heard it said. It is one of the leading cliches in politics: the older one gets, the wider one's waistband expands, and the more conservative one becomes. There are notable exceptions to such sad cases that affirm this dictum of aging reactionaries. One such prominent case was Tony Benn, who started out as a mainstream Labour politician of the social democratic post-war establishment, only move further to the Left as he passed through Parliament and more than one Labour cabinet. The only thing startling about the old man was that he was ever a banal centrist.

The praise now being showered on Tony Benn relegates him to the dull realm of acceptability. It was not so in the days when Benn posed a serious challenge to the Labour leadership and the prevailing Cold War consensus. The Murdoch gutter press went after him with characteristic fairness, they went through his bins, produced a bogus report on his mental well-being, and probably tapped his land-line. The hysterical press barons saw a dictator of the proletariat on the horizon, but they also saw a similar figure under their beds at night. Those days are long gone. The Soviet Union collapsed and with it the threat of democratic socialism evaporated. The death of socialism and the end of history were proclaimed. Only liberal capitalism was left standing, seemingly everywhere triumphant. A socialist like Benn could be praised for his integrity only because the game was over. The conservatives and liberals can now applaud him precisely because they think the battle is over and his ideas don't really work.

No longer a prospective dictator, we find Anthony Wedgewood can be lauded as a man of principle from the old-fashioned days of Clement Attlee and Nye Bevan. The exactitude of the principles if a another matter entirely, we're led to believe that the 'Old' Labour Party was for stripping away the wealth of the propertied classes. It just didn't work. It turned Britain into the Sick Man of Europe. Have no doubt about it, the Labour government of 1945 to 1951 established a welfare state and mixed economy which produced greater development, economic stability, and growth, than have been enjoyed since the post-war settlement was dismantled from 1975 onwards. As much a creature of the War (not to be confused with any mere wars) and the social democratic consensus of the 1950s and 60s Benn had the qualifications to speak for the anti-war movement and the socialist movement.

As a Labour politician who lived through the first Wilson administration which had sought to deliver significant rates of growth rather than address the distributional basis of the economy. The hope was that the growth would raise living standards for the working-class without really changing the class structure of Britain. Yet Wilson had come to power just as an economic boom was hurtling out of control. The government had to look to hold down wages and prices to get a grip on inflation. In the midst of this Tony Benn was made the Minister of Technology and would go on to chair the Industrial Reorganisation Committee. He spent the last years of the Wilson government picking winners and backing takeovers in the midst of the Jim Slater era of asset stripping and ram-raids on corporate structures.

History is full of ironies. It was the beginning of the deindustrialisation of Britain that would eventuate in the 1980s and 90s. The conditions of the post-war settlement which amounted to the grave crises of the 70s are what led the way for Thatcherism and later Blairism. Only for the new establishment to lead to the current crisis we're living with today. The vast swathe of Labour parliamentarians were on board with the new consensus by the 80s and many of them had been even before it had fully emerged from the womb of social democracy. It was the Callaghan government which had signed up for the IMF austerity programme, which Denis Healey later admitted was unnecessary and probably cost Labour the election. We can and should praise Benn for learning from this experience and having the fortitude to take the stances he did against the onslaught which was well underway by 1979.

The stagnation of the 1970s matched a political crisis within the establishment itself. The Conservative Party wasn't going to forget the humiliation of 1974 and was determined to inflict a historic defeat on the trade unions. Under these conditions Margaret Thatcher came to the foreground. Originally the candidate was going to be Keith Joseph, who had helped to spread the ideas of Milton Friedman. He argued the crisis was down to the decline of wealth-producing sectors of the economy and the growth of the public sector and government. It was tremendously popular in contrast to the perceived bungling of Ted Heath. In the end Joseph eliminated himself by giving a eugenicist speech on poor mothers and their children. This may have been the exuberance of the emerging consensus which would be consolidated under Thatcher. Few people saw what was coming.

The major ideological triumphs of the Thatcher regime can be rounded down to just two: the Falklands War and the Miners' Strike. Tony Benn was on the right side in both instances. He saw that the war was an unnecessary loss of life and should have been handled through the United Nations. It really was a battle between two bald men fought over a comb. Without the war the Thatcher government may have well paid the price for its vandalism and suffered a defeat in 1983. Instead the Conservatives benefited from the patriotic fervour whipped up for the war. It's possible that the subsequent battle over the mines would have not arisen had the tide been turned back at that point. Once the miners had been defeated in 1985 the Thatcherite era had well and truly consolidated its gains and could go on to further victories. The labour movement that had vanquished Heath was smashed.

Even in the face of such defeats Benn stood strong and kept to his principles. He maintained his position as MP for Chesterfield and condemned the pit closures which would toss so many onto the trash heap. He stood as a voice of working-class interests against the tidal wave of Thatcherism and its bid to dismantle the entire edifice of social democracy. He remained steadfast in his optimism, at a time when many despaired, and had good reason to do so. The arguments he put forward were rooted in common-sense and populist appeals to the moral collectivism of the people. He was not a Marxist, but a left-moralist. The influence of the Fabian tradition, with its gradualist approach, and fetish for reform, can be picked up here; but there's also a break with Fabian progressivism in Benn's shift to the Left. His faith in the democratic mechanism is not as lukewarm as some on the hard Left may like to claim. The welfare state was socialist development, but it wasn't the end itself. He wanted to see democracy extended to the economy, it was a syndicalist call for industrial democracy.

Thanking Monica.

In Praise of Sex Scandals.

What can we say of the economics of the New Democrats? Well, it wasn't too soon after the election Federal Reserve Chairman Alan Greenspan met with Bill Clinton and told the President that his election promises of social reform could not be carried out without increasing the deficit, which would lead to higher interest rates that would undermine economic growth. The dinosaur libertarian Greenspan advised the Clinton administration to slash spending in order to convince the bond markets to lower interest rates and growth would ultimately be generated. Surprising Greenspan the President swallowed this theory without a fight. Clinton made the case for austerity in order to achieve greater long-term economic growth. The prescription was a significant cut in public spending coupled with minor tax increases to fill the koffers left ransacked by 12 years of Republican government. It displeased the middle-class he had pledged to cut taxes for and further diminished the standard of living for the American working-class.

Out of a triangulated politics the Clinton administration implemented welfare reform which was much harsher than anything the GOP ever rammed through a complacent Democratic Congress in previous decades. As the boom emerged there was a widespread belief that it would not all come crashing down because of the innovations in computer technology. The guarantee of stability and stupendous rates of growth came with the advances in computer technology, equations and mathematical models could now be used to bring order to a chaotic marketplace. The state was not needed to intervene either. In theory, it would ensure long-term growth and the confidence in the midst of deregulation produced from this led to an orgy of lending. The banks could now throw money at millions of new lenders. High levels of competition and productivity were now within reach of a self-stabilising order. This is what became known as the New Economy.

Alan Greenspan was concerned when he found little evidence for any rise in productivity, yet he did find signs of "irrational exuberance". In 1996 Greenspan argued that the markets might be overvalued and that a dangerous speculative bubble was beginning inflated. The press attacked Greenspan and he buckled to the pressure. He now claimed that the advances in computer technology had been so significant as to ensure rates of productivity that could not be measured in the traditional way. Greenspan told Clinton it was like "discovering a new planet". The high-tech boom itself had come out of huge amounts of public investment over many years which culminated in the dotcom bubble. This was all going on as deregulation opened up the financial sector to run amok. It would all later blow up in the form of subprime mortgages. The financialisation that began in the 1970s and was intensified under Reagan and Clinton led to the economic disaster that we're still living with.

If we want to take the glass to be half-full then we might take the view that the Lewinsky scandal which saved social security from Clinton's prescribed privatisation as Robin Blackburn has noted. It was in the mid 1990s that the widespread attitude was that the social security system required radical reform. The privatisation lobby basked in the popular perception that an aging population would soon make social security unsustainable in its current form. As Clinton had just sold the workless down the river it was expected that the administration could well do the same to the retired and soon to be retired. Clinton had a top secret "Special Issues" coterie - with Larry Summers at the helm - to go over the minute details of the basis for a "bipartisan policy" on social security that would splice individual accounts into the program. Note the emphasis on unity in American politics runs constant, the preference is always for consensus rather than dissensus.

The New Democrats had snuffed the life out of the welfare program that had been established with the New Deal, now it was social security to be asphyxiated. It just needed to be harsh enough to win over the Republicans without appearing to be Draconian in order to keep the support of a fair chunk of the American public. It soon looked like it was going to be triangulation par excellence. So what went wrong? At the time the Republicans and the media were engaged in a moral crusade against Bill Clinton over a variety of accusations regarding his personal, sexual and political conduct. By 1998 the "Special Issues" agenda had developed seriously over the years and Clinton attended a meeting to review the project. This was in July, shortly before he was handed a subpoena and it wouldn't be long before he was confessing to an affair with Monica Lewinsky. Now Clinton could not be seen to be trashing a long-standing institution of American society. Social security reform was put on ice, the reform would have to be reformed quickly in order for it to be saleable.

It was not the time for a radical overhaul of the system as it had been founded during the New Deal. As one member of the "Special Issues" team would later put it "Toward the end of 1998, as the possibility that the President would be impeached came clearly into view, the policy dynamic of the social security debate changed dramatically and it became clear to the White House that this was not the time to take risks on the scale that would be necessary to achieve a deal on an issue as contentious as social security reform." Quickly the plan was reoriented to strengthen social security through a rare recourse to the budget surplus that the austerity had attained, of course a portion would be invested in equities. Clinton came to propose that 62% of the budget surplus be used to build up the social security trust fund. He promised to veto any attempts to divert social security funds to other uses while calling for 15% of the trust fund to be invested in the stock market.

The investment would be overseen by the social security administrators. It had the potential to create a powerful new lever over economic policy, naturally Alan Greenspan became an opponent of investing social security funds on the stock market. Nevertheless the reform was well received among the American public, the pessimism around social security was supplanted for optimism and the GOP had to concede that social security should be prioritised. And as the sex scandal deepened President Clinton fully endorsed the system. It set back the privatisation lobby in the form of right-wing think tanks as well as the corporate wing of the Democratic Party which Clinton had nursed so well. The consensus was now that social security had to be preserved, even George Bush pledged to prioritise it. The service remained untouchable until the recent economic crisis. This is probably the only reason to praise Clinton's promiscuity that had in the past led to so much misery for others. Fucking Monica Lewinsky may be the only worthwhile decision Bill Clinton ever made.

Spain's Pain.

Santiago Carrillo just passed at the age of 97, perhaps the last major figure of Spanish leftism to have fought in the Civil War and participate in Spain's transition to democracy. He became a major figure in the rising Eurocommunist movement, which could be understood most fairly as an attempt by the Communist Parties of Europe to take an independent line from the Soviet Union. It took the form of an embrace of the democratic norms and institutions of Western Europe in a bid to differentiate itself from Trotskyism. As the Civil War broke out Carrillo was brought into the orbit of the Soviet Union and he was later complicit in the Paracuellos massacre - in which some 2,000 prisoners were shot. The massacre was taken up as an instance of "red barbarism" by Franco's Nationalists. General Franco claimed that the war he waged on Republicans and the Spanish Left in the 1930s was a crusade for Christian civilisation - and he found common cause with reactionary rightists of all stripes to this end.

Franco's Falangists had finished the Second Republic by 1939 and in its place crafted what would be Europe's longest reigning dictatorship. The anarchist revolutionaries of Spain were crushed by the combined forces of Fascism, Stalinism and Western democracies. For the reactionaries in Spain it meant the end of the social upheaval and rebellious unionism that had threatened the fabric of Spanish society for too long. Francoism in Spain was born out of a negation of radicalism, at first Franco only promised a return to order and an end to the revolution. Yet he endorsed liberty, equality and fraternity in his first proclamation. He was quick to promise the middle-class the reversal of land reform, the banning of trade unions along with the parties of the Popular Front. The General went further to promise the return of the monarchy and defence of Catholicism. Leading conservative intellectual William F Buckley, Jr. described Franco as an 'authentic national hero' and condemned the left-wing government as 'visionaries, ideologues, Marxists and nihilists'.

As noted by Richard Seymour, the priority in rural areas of Spain during the Republican era was land reform and the countryside was subject to high unemployment. This helped the Popular Front government to spring up with the promise of quick land reform. The unemployed peasants couldn't wait for the government to deliver and opted to occupy large estates, starting with 3,000 farms in the province of Badajoz. The government legalised the early occupations given the amount of civil unrest and hundreds of thousands of peasants were resettled. The seizures provided not just land and work, a democratic forum was opened up where arguments were waged over the whole future of how the society would develop from then on. It was this which General Franco conquered and destroyed, the peasants and leftist leaders were swiftly done away with. Franco set out to undercut the Left with promise of nationalisations, even the Falange flag was designed to mimmick the flags of the anarchists they intended to annihilate.

Today the very radicalism that the Spanish Fascists had fought to eradicate has resurfaced in the time of austerity and widespread despair. As Fascism collapsed and Spain became a monarchical democracy Juan Manuel Sánchez Gordillo came to power in Marinaleda in 1979 and, as the rest of the world fell under the spell of neoliberalism, embarked upon the construction of a pocket of what has been described as a 'communist utopia'. There in Marinaleda there is no need for mortgages, while full employment has almost been achieved Sánchez Gordillo has sought to move to a common ownership of land and establish wage equality. Housing is now a right in Marinaleda, taxes are low and the groundwork of a direct democracy laid down. This continues while the rest of Spain suffers an unemployment rate of 25%, even the rest of Andalusia endures a 34% unemployment level. The situation is actually more dire than it is in moribund Greece in this regard. Everywhere there is disaffection and it has taken on living forms in the streets.

The Mayor of Marinaleda has become a prominent figure seen as a surfer on the tall waves of popular anger at the sight of the government handing billions to banks and cutting services to cover the bill. It's obvious he is not a lone-wolf either. The 8 million strong indignados have protested for hundreds of days against the austerity regimes of the established Left and Right of Spain's mainstream politics. The indignados have no faith in the formal institutions of representative democracy anymore. The striking miners of Asturias have taken to firing homemade rocket launchers at riot police and blocking off roads. It was the Asturian miners who were put down by Franco's forces in 1934 only to awaken from their slumber in 1962 and fight valiantly. Franco killed 3,000 miners in 1934 and captured many thousands more, but still they rose up again. Now it's the austerity regime of the Spanish government backed by the Euroconservatives at the heart of the EU that the miners are fighting against.

The egalitarian pocket Marinaleda stands out in Andalusia where around half the arable land is owned by 2% of the land-owners. In the Mayor's own words "The concentration of land ownership in Andalusia is 10% higher than it was in the Second Republic. They tried an agrarian reform. But it was annulled with Franco's coup d'etat... The agrarian reform is still pending." Sánchez Gordillo has been most controversial for orchestrating the looting of supermarkets. It was an act of civil disobedience to grab lentils, oils, beans, chickpeas and milk in order to redistribute the supplies through food banks to the poor. The police have been unable to arrest Sánchez Gordillo given his immunity as the Mayor of Marinaleda. The renegade Mayor has issued calls for other mayors to follow his example and for the occupation of empty buildings owned by the banks. A welcome cry in a country with 800,000 empty homes and millions in need of affordable housing. The death of European social democracy gives many good reason to seek out a more radical solution.

Debtors of the World, Unite!

With City Hall in the hands of Boris Johnson, an anti-political clown if there ever was one, it would seem that the intransigence with which the state opposes the demands of trade unions. There has been talk for a while now of taking the workforce out of the tube completely, replacing them with automated machines. It would be a popular move in the London City-State, where any kind of inconvenience equates to an outright assault on one's basic liberty. The tube unions are the last bastion of working-class power left in this country and this is precisely the reason that the forces of reaction are out to destroy them. No doubt it's part of the same process that has rolled back the state in public services and even more so today. After all the tube is mostly to get people out there to be rinsed at work and in the shops, think surplus value. Thatcher could only dream of doing what Cameron is doing today. The Tories themselves have been caught saying this, though we all know it.

The Tories handed over a lot of public money to banks from 1992 onwards as part of the Public-Private Partnership, which sold-off public aid and gave greater power to bankers. As Michael Hudson wrote "The financial giveaway had the effect of increasing prices for basic infrastructure services by building in heavy financial fees – guaranteed for the banks, who lent the money that banks and property owners used to pay in taxes in more progressive times." The theory goes that the banks will create jobs as they invest the funds in British infrastructure, specifically public transport, but it was really a way for real estate speculators to get even richer. The extension of the Jubilee Line to Canary Wharf cost £3.5 billion as it raised property values along the route by £13 billion. The public investment in transport could pay for itself simply with a tax on the higher rent-of-location and the site value. But the government would rather the banks rake in the cash.

As Chomsky has pointed out when politicians prefer to talk about 'jobs' than even utter the filthy word 'profits'. The allies of the super-rich then moved to sell-off British Rail and saw to it that the railways carry an over-flowing gravy train for the wealthy. It is standard practice in a privatisation for the state to make sure the buyers are well served with comfy pillows stuffed with the taxes of working-class people. Last year that blond gannet Richard Branson gobbled up £18 million of tax-payer's money as the system underwent a multi-billion state upgrade. The privatisation opened up a space for private ownership safeguarded by public investment and, even as standards of service have slipped, there has been no attempt to re-nationalise the railways. The government contributes £4.6 billion to the railways as the private sector pays just £459 million into the set-up, most of which goes towards stock rather than anything in the real world.

Since the 70s we have seen a process of de-industrialisation and financialisation. Thatcher sold-off an awful lot of things and broke the backs of major unions as part of a policy that amounted to the destruction of entire industries. Production was taken abroad where there was a ready workforce desperate enough to work for a $1 a day or whatever. The businesses of the country began invest overseas and import much more from abroad. The back of the industrial working-class was smashed in the 1980s leading to a massive unemployment level. So the threat of unions to the power of the wealthy had been significantly diminished. The people were left in a position where they could easily be squeezed dry by businesses, working-class people suffered some of the biggest wage-cuts in 1990. You would've thought that this would've held down the ability of people to spend, spend, spend. But a lot of credit had been freed up as the constraints that had kept banks in check were removed.

The shock of the assault on the living-standards of the working-class left them in an increasingly dependent position on debt. To make up for the loss in wages people turned to their credit cards, there was a much greater need for loans and mortgages than ever before. This is the basis of the explosion of household debts in the last 30 years. A lot of these debts are concentrated in housing markets because the system is pushed to find profitable investments in order to grow. We're talking about a minimum of 3% compound growth. The desperation to find new investment opportunities for over a trillion dollars has led to greater investment in the control of assets. We might want to think that the banks take unused funds from our bank accounts and use them to help some family to buy a home somewhere. Instead, what we've seen is the emergence of a huge property bubble and the concentration of enormous sums to feather the nests of a very few.

The banking system is built on the knowledge that not everyone will come into the bank and want every last penny of their money. Of course, when a run on the bank happens it's newsworthy for this reason - remember Northern Rock. The odds are calculated in the favour of greater lending and accumulation. The presupposition is that there being enough money to keep the bank going, so that there is enough there for people to pay the bills and put food on the table. The tendency here is to lend out more and more money to accumulate in order to cover itself. This is how the system pushes itself at the ground level. Everyone knows that banks aren't what they used to be. There used to be a time when the pound sterling was symbolic of a pound of silver somewhere. Now that's gone with the advent of fiat currency much to the chagrin of nostalgic right-wingers. It's much more important that the financialisation of the economy has made financial crises likely.

The household debt in Britain is set to rise from £1,560 billion to £2,126 billion in this time of austerity. I would assume there is something similar going on with household debts around the world given the attempts of government to patch up the system as it is. Household debt in the US was at 115% in 2011 down from 135% in 2008, the dip is probably the result of the crisis. In the years of the bubble, 2000 to 2007, households doubled their debt to almost $14 trillion while personal consumption shot up by 44% from $7 trillion to nearly $10 trillion. Over a period of 5 years American households ringed $2.3 trillion of home equity loans and cash-out refinancing from their homes. That's an injection of nearly $500 billion into the economy every year. So you can see why Obama's so-called "stimulus package" was a cop-out, $787 billion for 2 years doesn't cut it! Especially when it's left to the sort of self-glorified bureaucrats who would rather cut than spend.

There is actually an opportunity in this. It might seem that the working-class movement is finished because it has been de-industrialised and, at this point, unions have been reduced to xenophobic suspicions of anymore foreign rivals coming over here. That extends to the opposition of trade unions to European integration, these are supposed to be organisations that are internationalist. It's fine to propose unionisation of workers on a European scale. We're wrong to confine the prospects of unionisation to traditional industries that have been wiped out. Follow the money, grab the vampire by the balls before you drive in the stake! The formation of debtors into unions on a cross-continent scale could potentially give the working-class a way to yank at the banks. A straight refusal by the majority of people with debts to make the payments unless the rates of interest are cut could work. It could also be a way to repudiate the debts altogether.

There are flaws here, but it is a way forward. It would definitely need to be well organised and coordinated to ensure that it was a mass-scale action that would have an impact. Generally the major flaw of the trade union is that the relationship between capital and wage labour can be taken for granted. The priority is to improve the conditions for workers within that relationship, which is fine but the relationship is the fundamental problem. The capitalists have the upper-hand to the workers in this relationship, so victories can only be temporary. It's true that the debtor union would only be active in pushing for a better deal for people who need to fall back on credit cards, loans and so on. But it's striking at the centre of the system and we forget that banking is actually more susceptible to social democratic compromise than labour-intensive industry was. If the bankers think they have to pay-off socialism that's exactly what they'll do.

Invisible Handjobs.

Mirrors without Economics.

The chorus of "I told you so!" cannot fall on enough ears right now, not just in Whitehall but in the rest of the country. As the ears of the charlatans behind this doomed experiment - they call austerity - are notably deaf, only from below can the opposition emerge to this vandalism. It's only austerity for the people who rely on the NHS, state-schools and a benefits system to fall back should they lose their jobs. There was just word of a double-dip recession when the oik first set about on his 'slash and burn' approach to the economy. Since then we've seen growth dip, flat-line and then dip further, it doesn't seem as though the artful oik knows what he's doing. Or perhaps this is part of a fiendish plan. It remains to be seen, but what we know is that this man lacks any formal education in economics (that's not unsual) and he's surrounded by a coterie of advisers who are devoid of theory. He's far too comfortable taking risks which he won't have to suffer for and ordinary people will - the so-called 'difficult decisions'.

The message was posted and it was received with the Conservatives getting smashed at the local elections. It didn't seem to remind them they never had a mandate to begin with, they only succeeded in raising their vote by 3% against one of the most unpopular periods for the Labour Party. That says a lot that the political class don't want to hear. The last Conservative leader to win 40% of the vote was John Major and Thatcher was never as popular as the Party itself. All that really mattered to the Party was to keep hold of the London City-State, if that was lost then the whole thing could be lost. It was also a key opportunity to snuff out any sign that Galloway's victory in Bradford would have impact outside of Yorkshire. And yet the Tories entertained the delusion that Boris won because he embodies a solidly conservative set of virtues. The gap between Ken and Boris now closer than ever at 3% rather than the 6% gap in 2008. There was some truth to Ken's suggestion that he was just "hated more" than Boris.

In the midst of this the BBC seem incapable of acknowledging that the ongoing attempts to reduce the deficit will shrink the economy. They can't even articulate that the cuts to the amount of money flowing into the economy will not boost demand and growth. We're just told that the cuts to the salaries and pensions of public sector workers are a necessity. It's even assumed that there's just 'waste' to be cut and growth can still emerge from this process. Oh yes, the new mantra is deficit reduction and growth - an oxymoron of the highest order. Even if the aims of the cuts go as far as deficit reduction, it would seem that the cuts are insufficient in this aim and may actually increase the deficit as unemployment remains high. The Right will naturally prescribe another round of cuts. For a long time it seemed that the possible had become impossible, yet today most of us can see cuts aren't the way out of this recession and no one dares to reach for the alternatives.

On the Tumbril.

The pretensions of travail, famille, patrie were done away with swiftly on May 6th. The French voter took the Rat Man to the tumbril and placed the Flanby in the Élysée Palace. Well, Hollande will take office tomorrow to be exact. He won 55% of the vote on a platform calling for an end to austerity, though Hollande may have defined himself as the successor to Mitterand he had plenty of words in the right tone as he spoke about a great change across Europe. This is the first time in France for 30 years that an incumbent lost a second term - a testament to the strange times we live in. Sarkozy now joins the ranks of Berlusconi as just another establishment right-winger to be knocked out of power in the midst of the Eurocrisis. The appalling attempts to grab the frothing racist vote shocked many, it was ultimately too much for the supposed pragmatism of French politics. The major point is that the tough-love programme of tax-cuts for the rich and public service cuts for the rest of society has been rejected.

As Mark Hanna would remind us "There are two things that are important in politics. The first is money and I can't remember the second." Word has it that £40 million of funds in the Rat Man's campaign chest came from the dearly missed Colonel Gaddafi. There has since been talk of $65 million and another despot Alexander Lukashenko has claimed that the actual amount was $100 million. Whatever the case it has long been clear that Sarkozy is a creep, a wannabe de Gaulle with that trope of French chauvinism - the suspicion of the Anglo-Saxons. That went as far as claiming the economic crisis is an 'Anglo-Saxon disease' even though Sarkozy had posed as a French Thatcherite. He suggested taking a Kärcher to the neighbourhoods affected in the riots of 2005. Supposedly it was Bernard-Henri Levy persuaded him to wage war on Libya. Really, it was probably the rebel's promise to respect old oil arrangements that made it clear Gaddafi was no longer a necessity in North Africa.

On May Day Sarkozy demanded of trade unions "Put down your red flag, and serve France instead." It was an impotent call, he had to have people brought into town to be filmed in front of the Eiffel Tower. Nonetheless, this dwarf embodied the spirit of reaction in French politics coming at the end of a long line from the Thermidoreans through Pétain to d'Estaing. This may be another instance of the Europeans taking out the incumbent for the other guy, but this time it is a guy who was calling for a stop to cuts. Hollande may retreat from this to some extent, if not all together. We have yet to see. The German elections are coming up and if we see a swing to the centre-Left there could be a shift in policy which might lead to a domino effect across Europe. Naturally the European ruling-class has already seen this coming and they're prepared for a fight. Not everything is going to plan, but it'll take a bit more from the people of Europe to derail this out-of-control train.

Business as Usual.

The process we have endured over the last 40 years was the nightmare of classical economists. The fear was that the merchants and manufacturers would conspire to shape public policy in their favour, that they would do business abroad - investing abroad and importing from abroad. It would rake in enormous profits, but England would have been ruined. Adam Smith argued that the merchants and manufacturers would give priority to their own country, as if by an "invisible hand" England would be saved in this way. Since the 1970s we have witnessed de-industrialisation at home combined with off-shoring of production abroad and shifting to finance over industry. The causes of the crisis are barely discussed, we just have to look forward to the way out. We're no far from the nightmare of classical economists. But it's been pretty awful for a lot of ordinary people and it could get worse. There is no "invisible hand" in sight.

We the British tend to love business as usual. That was evident in the 1930s when we lined up to vote for Conservatives who wanted to sell-off chunks of Europe to Hitler. We don't like to recall just how compromised the Establishment really was. It may have gone as far as the Royal Family, the House of Lords and the proprietors of major newspapers. Even Churchill said in 1937 "I will not pretend that, if I had to choose between communism and Nazism, I would choose communism." When it went wrong and no amount of appeasement could hold-off the inevitable there wasn't much else to do but stand still under the bombs. The people with any means available to them would escape to the countryside. For the lot left behind there was plenty of time to rob bombed out houses and even steal from the dying. Even firemen were caught looting buildings, the fires of which they had just put out. People were crushed to death in the panics to rush into the underground for safety.

David Cameron might be more Chamberlain than Churchill, but for the most part we've managed to stir clear of the spirit of the Blitz with the exception of the riots last summer. Still, it's not really a fair comparison. Between September 1940 and May 1941 there were over 4,500 known cases of looting and juvenile crime made up almost 50% of all arrests. And yet huge gains were won for the working-class movement after the war. The only moves we're seeing to secure those gains have been the odd strike. Officially 400,000 people marched this week in London over pensions, the crowd included 20,000 coppers, and London Occupy has sprung up once again. This is the ongoing resistance to the cuts that hasn't been going on in the US. The courageous protests across the pond in Wisconsin and on Wall Street (which shouldn't be sneered at) have been blips on that vast land-mass. There are huge differences, in Europe we're seeking to protect the social democratic accomplishments of the last century while in America these victories have yet to be won.

Freedom or Death.

We have seen large-scale demonstrations across Europe, including general strikes in Portugal, Spain, Germany and France. The most heroic of resistances has been fought in Greece, which has been hit badly by the crisis to say the least. Of course, there is a lack of coordination on a continental scale, so the bursts of rage are sporadic and unpredictable. Europe still has something of an organised Left, which America barely has anymore. Perhaps history only ended, as Fukuyama suggested, in the US. The emergent SYRIZA, a coalition of leftist parties, which has been making significant gains in the recent Greek elections. The coalition is only 2% behind New Democracy, the conservatives who are closest to taking power. Even the Communist have won 8% of the vote and the Democratic Left got 6%, while PASOK has fallen to 13%. It looks unlikely that the Greek Left will be able to form a coalition government due to differences over austerity and the usual sectarianism that plagues the Left wherever it can be sniffed.

It's possible that New Democracy and PASOK will form a government, - the equivalent of Labour cutting a deal with the Tories - a capitalist bulwark to push through austerity and wait until the socialist storm passes. In retrospect, the victory in France for the established Left holds greater significance with the gains of the radical Left in Greece taken into account. The ruling-class is determined to reconstitute the status quo and get its way. The fight isn't over, though some would prefer to turn our attention to the presence of the Golden Dawn in the Hellenic Parliament. This seems to overestimate the possibilities of a return to Metaxism in Greece, given the gains that the neo-fascists have made are still dwarfed by those of the Left. We shouldn't fool ourselves that these herds could put together the Fourth Reich. The Greek Left needs to push further and be on guard against any possible attacks Golden Dawn might launch on immigrants.

The rape of Greece has opened up all kinds of possibilities, it is an unstable situation. We're told not to sympathise with this profligate nation of wasters and yet this is where some of the longest hours in the world are worked. This is the birthplace of democracy which the Germans and the French have shown nothing but disdain. The Greeks remain remarkably in favour of European integration in spite of the garbage the Franco-German reactionaries have been trying to feed them. The country has been trashed for the sake of a right-wing experiment that was rushed into after Germany reunified. There are some profiteers in this crisis, Greek workers aren't being paid and are being fired across the board. SYRIZA are sticking to their guns, calling for the nationalisation of the banks, paying of the debts owed to pensioners and an end to "structural adjustments" in the jobs market. The Greeks are right to resist of the attempt to destroy the living standards of huge swathes of the population. Recall the old slogan: freedom or death.

Brand Obama - Prospects for a Second Term.

It has become fashionable to attack Barack Obama not just from the Right but from the Left as well. We should not lose sight of the magnitude of the election of the first African-American to the Presidency, especially as it was slavery which built the White House and provided the material conditions necessary for American capitalism. But the election of Obama was not the fulfilment of the dream that we all pay lip-service to. The ideological goal-posts of America have been shifted under Obama in a way which was unthinkable under just another white male politico. With that in mind it is impossible to deny that Obama would be a better President if he had not backed the coup in Honduras and slashed the wages of Haitian workers in the aftermath of the earthquake. The same goes for the way Obama has extended the war in Afghanistan to Pakistan. Let alone the drone attacks on Somalia which have been conveniently ignored in the mainstream media.

It has been a long strange trip since 2008 when the first African-American became President-elect and the American people were ready to say "Adios!" to George Bush. That year the Obama campaign team won the award for the Best Marketing Campaign, with commiserations to Apple and Nike. The election was the subject of an enormous flow of corporate dough and grass-roots campaigning which succeeded in electing Obama. Soon the word was out that the US had finally gotten over it's silly little race problem, it had become a "post-racial" society overnight and just around the corner the 'birthers' were on their way to tell the world that the President was a "closet Kenyan". There had already been attempts to pin the label of Muslim to Obama's lapel, the point being to call him a "terrorist" without actually saying it. Soon the favourite substitute for the n-word was "socialist". By now we can listen to the odious Newt Gingrich calling Obama a "food stamp President". Notice all of this has no relation to reality.

There is very little of substance for Republicans to complain about. Obama has conceded on health-care reform (which were conservative changes anyway) as well as the Bush tax-cuts, the National Defense Authorization act and on the stimulus which was wiped out by cuts at other levels. So the GOP shout about debt and they would love to run on economic issues, but they can't win on the economy because their policies only appeal to the top income brackets. The Republicans need more than just the ultra-rich to vote for them, the Democrats can appeal to ethnic minorities, gays and women to seek refuge in their party. The GOP are in a truly desperate situation. It was most astonishing to see the Republicans take a contorted anti-capitalist position last year, when they tried to block the rise of the debt-ceiling and in doing so acted to undermine the accumulation of wealth. At this point Karl Marx would just smugly remind us that "the contradictions of capitalism work in mysterious ways."

It is common knowledge that the outcome of American elections are basically bought. Back in September, Obama had the lead on Romney with a gap between them of over $50 million. Now we find the Republicans have leaped in front of the Democrats by almost $6 million. In 2008 Obama raked in around $750 million which was far more than McCain could muster. The estimates for the costs of 2012 are running as high as $11 billion and probably about $2 billion poured into the campaign war-chests. The core base of the Obama campaign were the same financial institutions which caused the Crash of '08. The small donors to Obama's campaign should not be ignored, but they amounted to $300 million at most which still leaves $450 million on the table. Large donors have been donating enormous amounts of cash in small chunks as to appear as small donors in the stats. This is something the Obama campaign encouraged from day one and probably still does.

It is corporate interests which shape American politics and every so often there is a convergence with working-class interests. The Obama health-care reforms were designed to drive down the costs entailed by the private system on manufacturing companies. It costs General Motors $1,000 more to produce a car in the US than it does in Canada. A system of universal provision would have a significant impact on the deficit, it would reduce it heavily. This is why a national health service is an inevitability.  In fact the Republican Party put forth these proposals when Clinton pushed for health-care reform in the 1990s. The former draft-dodging pothead Newt Gingrich is still a defender of the individual mandate and Mormon vulture Mitt Romney imported the same reforms in Massachusetts. Both Gingrich and Romney have been attacked for this by the ultra-Right for whom there is no "pure" conservative. These are the people who want to reduce the deficit through cuts and no tax increases, but insist on a "strong military" which costs $1 trillion.

The deciding factor could be turnout in this election, there is an extreme disillusionment in the electorate and both parties could feel the brunt of this. But it isn't just apathy in this situation which could tip things over. The GOP are well aware that the White House could be seized if they the opposition simply doesn't vote against them. Remember George Bush only came to power because the GOP managed to disqualify black voters in Florida. On average the Americans who earn less than $100,000 lean towards the Democrats, that actually accounts for 75% of the population - which only had 36% of the vote in the 2010 midterm elections. The forces of reaction are well aware of this, thus the Republicans have opted to make it as difficult as possible for Americans to vote. It was conservative Paul Weyrich who told a gathering of evangelical leaders in 1980 "our leverage in the elections quite candidly goes up as the voting populace goes down." Almost 40 states have introduced measures to deliberately hinder voters.

The voter is now expected to provide proof of citizenship before registering in some states, ex-felons have been barred from voting, in some states you'll need to produce a government-issued ID before you can vote. This would exclude that 10% of American voters, 18% of the youth and 25% of black voters. This is comparable to the use of poll taxes and literacy tests to prevent blacks from voting out the racists in the South. Ironically, the Republicans have pulled this off on the grounds that there needs to be tighter guidelines to eliminate "fraudulent voters". Naturally the same billionaires who bankrolled the Tea Party are in the shadows seeing to it that the cogs in the machine are well oiled. This could be the divine, or should that be satanic, intervention to save the Republicans grabbing at political power wildly. It's even possible that the GOP are looking towards 2016 at this point. With that in mind, we should remember the words of Hunter S Thompson "The race is not to the swift, nor the battle to the strong, but to those who see it coming and jump aside."

Blizzards of Shame!

How long must this go on?

You may have heard of the recent discovery the long lost Bulldog spirit has been found finally as it was manifested in Mr Cameron when he said "No!" to Merkozy. It was not national interests David Cameron was defending, it was the interests of banks who don't want to be taxed or be regulated that he was defending. The revolting servility this filthy Tory has shown has nothing to do with patriotism, though it is symptomatic of the whorish relationship between the Conservative Party and the financial colossus in the City of London. The fact that this can even be considered patriotic is the sign of the crass state of the political discourse in this country. The nationalist Right are experiencing something of a resurgence amidst this economic turmoil, so there's nothing to lose in a bit of flag-waving especially after a round of shit-flinging on the Continent. The choice we face is between Brussels and Washington, but European integration cannot be anti-democratic as it is right now. Cameron is no democrat for standing in opposition to the treaty, the politics of Cameron have a great deal of commonality with Angela Merkel and Nicolas Sarkozy.

David Cameron seems to embody the Progressivism of Victorian liberalism, at once a creature of the market forces as well as a cultural puritan and a proponent of history as progress. The crisis is just a cyclical phenomenon to him, in the long-term it is a blockage to the path of the march towards a utopia of the free-market. The theoretical doctrines of monetarism have been replaced by a pragmatism which cuts through theory to the reality, where the old state system of health-care and education has to be discarded. The debt has to be managed through a deficit reduction which will thereby enable us to circumvent this obstacle. The key elements here feed into one another: the market is perfect so the crisis is cyclical not structural and will pass in time, therefore there are no grounds to justify state intervention to create jobs and the deficit is the real issue. The regulation and taxation of financial institutions has to be stopped then, as the problem will pass as the structures of finance are adjusted through the reforms being implemented already.

In the light of Mr Cameron's transformation from Etonian Toff to British Bulldog, the talk of Christian values is quite interesting. David Cameron has listed the following as Christian values: responsibility, hard-work, charity, compassion, humility, self-sacrifice, pride in working for the Common Good and honouring the social obligations to family and community. This is where Mr Cameron's edge in public relations (which used to be called 'propaganda' in more honest days) comes across in his presentation. The man knows how to dress an agenda and not just the monkey he keeps for a deputy. Cameron can spin the line on it's head and roll out commonsensical rhetoric at just the right moment. No one opposes the basic concepts Cameron endorsed and for this reason they do not require endorsement. What matters most about the endorsement relates to the standards he has set in office already. For instance, the banks clearly are not about "self-sacrifice" as made evident by their refusal to tolerate even modest levels of progressive taxation and regulation.

It shouldn't be a surprise that Cameron is looking after the principle constituents of the Conservative Party. This cultural conservatism is superstructural to the economic base which it has the potential to undermine and may be threatened by itself simultaneously. In other words, the endorsement of Christian values amounts to an outgrowth of market liberalism. The particular appreciation of charity in Cameron comes out of the harsh Victorian hatred of the undeserving poor as it posits a deserving poor, which should be helped and has been shafted by the welfare state. Compassion should be rationed then. Humility too, only applies to the poor who should know their place. Of course, the banksters have no time for responsibility and any hard work which actually produces things has largely declined in this country. And yet the masses are meant to be committed to sacrifice themselves for the super-rich. These supposedly Christian pronouncements by Cameron reveal a profound hatred for the working-class in this country.

Can you taste the Irony?

The liberal philosopher John Locke provided a theoretical justification for private property, market relations and bourgeois conceptions of freedom. But it was the Whig circles in which Locke moved that would eventually bring down the King and in turn provide the incentive for Locke to provide such a justification in the first place. Locke was a close friend of Lord Shaftesbury who founded the Whig Party, though Locke did not share the Paganism of Shaftesbury and a number of the aristocrats of the day. The ruling-class feared that the Catholic King was loyal to the Vatican, so there would be a forced rival of Catholicism in the country which would mean violent upheaval. The violence that it would take to the reverse the process which established the Church of England and Protestantism would inevitably undermine the power structure. So the Pagan ruling-class conspired to overthrow a Catholic King in order to install a Protestant King and maintain the status quo.

Shaftesbury's friend John Locke was eager to provide a philosophical justification for the replacement of King James II with William of Orange. The foundations of liberalism were laid with a Christian gloss in the defence of the interests that the English ruling-class had vested in property. Christianity was for the poor and the ruling-class remained Pagan in Britain until the 19th Century. The liberal pronouncements of John Locke gave the coming market system a language of natural rights and freedoms. After feudalism had crumbled it ceased to be the 'natural order' and from then on capitalism would be considered in accordance with human nature. The irony is that the nationalism behind Cameron's veto comes from the old Pagan logic and not any kind of Christian value. Here we find a return to the Paganism of the British ruling-class as opposed to the Christian poor. In Christian love there is no hint of the Pagan logic that we must privilege our own clan above the rest.

An even greater irony is that the decision to veto the treaty may have actually maintained the limited democracy we endure in this country. The move was made to secure the interests of banking and finance, not out of any Bulldog patriotism. So the enemies of social democracy may have saved the possibility of a return to Keynesianism in Britain. As the treaty enshrines balanced budgets, near zero-deficits and has effectively abolished expansionary public spending in doing so. This shouldn't be a surprise to anyone as the European Union was a right-wing project from the very beginning. This was just the latest attack on social democracy and a testament to the appalling state of affairs in Europe. We have only to turn to the unconscionable vandalism of Greece - a country which should have been allowed to default - to find an even more telling instance. The European elites are stopping at nothing to use this crisis to tear apart the welfare states created after WW2.

Not only would it seem that this is a time of creative destruction, but the social democratic model of yesteryear cannot save itself. We are caught between a giant douche and a turd sandwich, to borrow from South Park, in that we face a choice between Washington and Brussels. The reason that European integration should be pursued along lines which are democratic and offer an alternative model to that of predatory American capitalism. Meanwhile the Right will continue to shout as though the choice is between Whitehall and Brussels. There can be no referendum on the capitalist system and so we have to take a stand together as Europeans. There is a long way to go in this area, as we have yet to establish trade unions which can represent the European workers as a whole of entire industries. The kind of national discourse available in the United States is not available in the European Union yet. Complete withdrawal is just a nationalist delusion that has already been ruled out by globalisation. The more fundamental struggle is a fight against capitalism.

See also:
The Left must call the Right's bluff
Class Warfare

Democracy is not a given

Solutions for whom
We cannot abandon Euroscepticism to the Right

No Society, No Alternatives.

The Iron Lady.

 

In the General Election of 1979 the Conservative Party came out on top with Margaret Thatcher as Prime Minister. For Thatcher any attempt to manage the economy would lead to disaster and the catastrophic crash of 1973 was caused by Heath's attempt to control the economy. Instead Thatcher decided the state should be "rolled back" and power be handed over to the markets, a wave of deregulation and privatisation followed. The idea was that the unhindered power of the free-market would reconstruct industry. Heath removed exchange controls and opened up the UK economy to the international financial markets, money could now be moved in and out of the country at will. The banks could now raise huge amounts of capital from anywhere in the world in order to finance the purchase and sale of a vast number of companies. The banks could now target a company, finance entrepreneurs to buy that company and then strip the company of its' assets. The point was to increase profits and maximise return to the shareholders.

Private Vices for Public Benefits.

We might understand Thatcherism as a combination of monetarism and rational expectations, which suggested that the changes in policy could only be managed if the public were convinced that the government would stick to it regardless of what happens. Of course, the cuts in public spending required a determination to confront and smash the labour movement. This went as far as sicking the right-wing elements inside MI5 on Arthur Scargill and the NUM. Thatcher provoked a strike with the announcement that there would be a wave of pit closures and redundancies on the grounds that it was cheaper to import coal. The Thatcher government went after one union after another in a bid to sweep away the remnants of the post-war settlement which had empowered working-class people. The country was opened up to foreign investment and competition, which further undermined the trade unions and destroyed industries like steel, cars and shipbuilding.

After the fall of the Heath administration in 1974 it was clear to the elites that the labour movement had to be broken. It was the only way to turn back the tide as the working-class made significant gains in the standards of pay and working-conditions. One of Thatcher's economic advisers Alan Budd has since conceded that in his most pessimistic moments he suspects that his ideas had been ruthlessly used. Furthermore that the ideas of monetarism served as a theoretical cover for the Thatcherite policies, which could not have been implemented otherwise. The capitalist class had simply seen in the ideas a way to instigate a crisis of capitalism which would smash the trade unions and leave the country immersed in unemployment. It would be easy to hold down wages from then on and profits could skyrocket once again. The rise of Thatcherism might then be attributed to the structural needs of the system for a much more timid working-class that could easily succumb to exploitation and domination.

The Road is Clear.

In the 1980s there was a decline in wages for working-class people and unemployment increased rapidly as the benefits system came under fire from the government. To supplement the loss in demand the need for a fast-track line of credit emerged, the debt economy was pushed to its limits as households across the country fell back on credit cards, loans and mortgages. The privatisation of social housing in Britain at first appeared as a gift to the working-class as it made it possible for them to buy an asset, at a relatively low cost, which might make them rich one day. The housing market was seized upon by speculators, eventually pushing low-income earners out to the outskirts of cities as house prices skyrocketed. The old industries were swept aside to make way for the new era, in which money would be made from money and not much else in Britain. After 11 years of Thatcherism manufacturing in the UK had been virtually destroyed, employment in manufacturing plummeted by 30%.

The deregulation of the financial colossus in London led to the currency crisis of 1984 - speculators had begun to sell pounds and buy dollars because of high exchange rates in the US - and the government just had to stand back and watch. It was the early signs of what would come in later years. In 1987 the Thatcher government retained power for a third election just as the country was hit with an economic crisis, as a wave of panic swept the stock market, as it turned out that shares which had risen in value for 4 years were over-valued. The global markets were soon infected by the contagion of fear and the governments were powerless in the face of such chaos. The rise of a rapacious financial sector had been the works for a long time, now it surfaced and went on to stumble into a devastating crash in 1992 and an even more destructive crash in 2008. As the political class had unleashed the forces of finance they had bound themselves as slaves to the financial colossus in the City of London.

The Long March, to Where?

The fall of Thatcher in 1990 came after the Poll Tax demonstrations descended into riots in Trafalgar Square converged with internal tensions in the Conservative Party. By then unemployment had reached around 7%, working-people had been by some of the biggest wage cuts in the world as inflation began to rise into double figures once again. John Major looked to reassert control over the market for the purpose of setting limits to the fluctuations of the exchange rate. Of course, it was too late for the Grey Man as the old forms of political control and planning had been obliterated as options. So under Major, Britain became a part of the Exchange Rate Mechanism and the pound was fixed to the Deutschmark in order to liberate the currency from the speculators. The currency markets then took on the British government, to force Major to devalue the currency and to abandon the Exchange Rate Mechanism. It began with the sale of billions of pounds on the foreign exchanges.

The marketisation and systematic privatisation has brought destruction to major industries and has significantly undermined the welfare state as it was in the post-war era. The workers' share of GDP in wages reached its highest points in the 70s, Thatcherism succeeded in the reversal of this trend and the policies which she first implemented in the 80s have become the orthodox for British governments. Between 1997 and 2009 wages for working-class people increased by 45% while the wages of high-earners increased by over 300%. Today we live in a society which is more unequal than it was 40 years ago, the top 10% get 31% of income, while the bottom 10% get 1.3% of income, this is the same 10% of the British population who sit on £4 trillion in wealth. On top of this, the end of the Cold War signaled the beginning of a supposedly post-political era in which only managerial politics remain and Thatcherism has taken the place of the social order it aimed to dissolve. We live in an era without ideas, where no alternatives are imaginable and where even the suggestion of 'society' is suspect. It was the collapse of the post-war settlement under the weight of its own contradictions which has left us in this state of affairs, now we need a new settlement.