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.

The ultra-Politics of Powell.

Delusions of Nationhood.

The economist Friedrich von Hayek was a member of the Mont Pelerin Society and so was Enoch Powell at the same time. Powell would later garner a reputation as a 'maverick' in the Conservative Party. He posed as a libertarian critic of the welfare state, immigration and European integration. Even though Powell voted for Clement Attlee in 1945 out of disgust over the way that the war ended and stood in opposition to immigration controls in the 1950s. As Health Secretary under Macmillan, Powell personally oversaw the employment of the Commonwealth immigrants at the NHS which was understaffed at the time. He was opposed to attempts to restrict employment of immigrants in the public sector on the basis that it was wrong to treat an individual differently on the basis of their origins. Powell was a libertarian and a staunch nationalist who believed in the Empire, which he saw collapse in his own lifetime and he yearned for it to be restored. As MP Powell drew up a plan to reconquer India in 1950, which Churchill dismissed as "madness". He was opposed to US influence, Irish reunification, Communism and European integration out of this belief in the British Empire.

Milton Friedman, a fellow member of the Mont Pelerin Society, praised Enoch Powell as a principled man. Powell stood by monetarism throughout the predominance of Keynesian theory and the widespread practice of social democratic policies throughout the Western world. The sumptuous distance from power that Powell enjoyed later functioned as a plateau from which a shot could be fired at the Establishment in standard populist manner. Of course, the distance served the ultra-right as a comfortable place for indulgence away from any chance of serious reflection on policy and theory. The point of excessive rhetoric for Hayek was to bolster support for the old system reconstituted behind the mythic guise of 'free-market'. The state-planners of social democratic capitalism would be placed by a managerial state-capitalist nexus, whereby the 'competitive order' is maintained. Powellism is no different, it was the standard Tory combination of classical liberalism and cultural conservatism. It parades before the rabble in the proto-populist garb of parochial nostalgia for the imperial glory and unfettered capitalism of the Victorian era.

Enoch Powell became a strident opponent of immigration after Ted Heath became Conservative leader in 1965, with Powell coming third behind him and joined the Shadow Cabinet as Secretary of Defence. Around this time Powell became increasingly critical of immigration and came out in opposition to Sikh men wearing turbans at work. It may have been a bid to position himself for the leadership role in the long-term. It couldn't have been pure opportunism on his part given that it was a position he maintained for the rest of his life. He saw himself as a prophet and it came through in his language, it was the words of Virgil he invoked. But it is clear that the 'Rivers of Blood' speech was timed to put Ted Heath on the spot and shape immigration policy dramatically. He was silent in opposition to the Race Relations act when it was discussed by the Shadow Cabinet just 10 days before he made his notorious speech. If Ted Heath failed to undertake tough policy-decisions on immigration it could have meant another Labour victory in 1970, after which Powell could have challenged Heath and become party leader.

Tried and Tested.

Once in power Ted Heath abruptly castrated Powell as a potential rival with the 1971 Immigration act, which reduced immigration to zero in the early 70s. Heath rejected the suggestion, as Powell had, that the state could manage the economy. The Conservative government embarked on a new approach to the economy, which hoped that the unhindered market would reconstruct British industry and society. Powell had long been a proponent of such an approach and now there was the chance to see it realised. But the Heath government abandoned the approach abruptly as unemployment started to rise and industry was left devastated. The new strategy was a "dash for growth" with the liberalisation of credit and a higher level of public spending. It was for a moment that the British economy boomed before the phenomenon of stagflation emerged as inflation and unemployment to rise simultaneously. The Keynesian orthodoxy was left perplexed and the monetarists found the chance they had been looking for.

Even though Heath had abandoned the market as the instrument to organise society and, much to the chagrin of Powell, saw Britain join the European Economic Community, the Conservative government helped set the conditions for Thatcher - which was heavily influenced by Powellite thinking. The Heath administration had 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 on a whim. The threat to democracy of deregulated finance proved correct as we have witnessed a political stasis in the West since the global economy underwent the first stages of financialisation. It was the stagflation which opened up the space into which monetarism could enter as an alternative to Keynesianism. The failure to manage the economy gave credence to the position that the state could not manage the economy and should not be expected to. The way that the labour movement defeated the Conservative government demonstrated that the working-class had to be broken.

Powell was the consummate precursor to Thatcherism, in many respects, and had good reason to take delight in the collapse of the Heath government. Of course, Powell had a lot in common with Heath and a lot more than he would have admitted. The immigration policy of Heath was crafted to neuter him and the economic doctrine could only be salvaged for Powell as it was aborted. Under successive Labour governments there was an increase in deportations and the introduction of virginity tests on Asian women coming to live with their husbands in Britain. Again, Powell could languish at a distance from power and comfortably refuse any critical self-reflection at all. The Heath administration was not 'pure' in its approach to economic affairs and it sold out to the Europeans at the first chance. Powell could reassure himself that the ideas in his mind had yet to be realised. Then came the rise of Thatcherism and this time it would be different as Thatcher made clear when she said "To those waiting with bated breath for that favourite media catchphrase, the U-turn, I have only one thing to say: You turn if you want to."

No more U-Turns?

This time the government did not back down to the trade unions and instead systematically crushed every union it provoked into confrontation. In many respects Thatcherism was Powellism adjusted to the processes of globalisation and financialisation. The austerity measures of the early 1980s led to violent riots across the country in some of the most deprived and vulnerable communities. The ideological justification for the cuts came out of neoliberal doctrines which Enoch Powell supported and propagated throughout his career. The process by which the state was "rolled back" left the population devastated. It required the shock of the Falklands war to bolster patriotic support for the government. But it also required a means to explain away the social problems that the process generated. This is where Enoch Powell is on the side of the Establishment. The riots just supported his thesis that there would soon be violence and destruction on a huge scale if immigration were not reversed. Conveniently Powell could spout this line and not confront the consequences of the economic policies which he supported.

At the same time, Powell could hide behind the fact that the policies did not go far enough and the social democratic settlement was not obliterated totally. The doors were periodically opened to permit a spurt of immigration in order to boost the supply of labour. The so-called "special relationship" between the US and the UK continued as the US permitted the British retaliation to the Argentine invasion of the Falklands. This was a war fought in America's backyard against an action undertaken by a dictatorship that Washington had supported. The days when the British rebelled against American foreign policy were long gone. Integration with Europe continued steadily as it had since the 1950s, with Thatcher pushing through the single European act - perhaps one of the most integrationist measures. Thatcher was also a member of the Heath Cabinet which took Britain into the European Economic Community in 1973 and campaigned for a Yes vote in the 1975 referendum. Margaret Thatcher was no bastion of 'national sovereignty' rather she never deviated from the traditional Conservative position on European integration which we might describe today in the vein of UKIP as Europhilic as opposed to Eurosceptical.

The Euro was a right-wing project from the very beginning as the European Central Bank has no qualms about the level of unemployment. Yet it is often portrayed as a leftist project by the ilk of Powell for the reason it is a state-system and we are reminded that the state fails to do good even on the rare occasions that it means to. The convenient blind-spot is to the neoliberal role of the state as a managerial system of a 'competitive order' in Hayekian theory. The right-wing opposition to social democratic capitalism was just an opposition to the particular form of the state-corporate nexus. Instead of state-planners looking to provide services and a social safety-net to the poor and most vulnerable, people like Powell were looking for a bureaucracy which would do more for business than society. As convenient as it may be for reactionaries like Powell to dismiss the Left for having ideas, it has to be said that the return to the glory of Victorian Britannia really is utopian. The only acceptable state project is on the side of 'national sovereignty' which has no place for the poor except as a dis-empowered rabble to be exploited.

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.

The End of the Golden Age.

The Last Gasp of Liberalism.

In the late 1960s the Labour government cancelled many of its election promises and moved to cut public spending as it faced rising inflation. The government turned to raising productivity in order to drive growth, a quick way to reorganise British industry was needed. It would end up following a model pioneered by Jim Slater, who set out to strip companies of assets in order to generate a short-term profit. Slater did not profess to hold any concerns at a social level, the only concern he had was to make money and nothing more. So the government put together an industrial reorganisation corporation to supervise a radical experiment in British industry. Under the guidance of Tony Benn the state orchestrated massive takeovers and mergers in British industry, with conglomerates forged out of old companies and thousands of workers made redundant in the process. The Wilson government effectively oversaw the liquidation of industry in order to raise productivity and efficiency to new heights.

Thatcherite before it was Cool.

The Conservative government formed around Ted Heath in 1970 embarked upon a new approach to the economy. Heath rejected the suggestion that the state should or could manage the economy, instead he opted for less intervention in the economy and ultimately to leave the lame subject to the forces of the market. As Rolls Royce went bankrupt and the experiment led to the closure of numerous factories and unemployment began to rise Heath backed away from the approach. The government then went on a "dash for growth" through the liberalisation of credit and a raised public expenditure as the earlier policies seemed to not be working. For a moment it seemed to work, the British economy boomed briefly and then the phenomenon of stagflation emerged as inflation and unemployment began to rise at the same time. The Keynesian orthodoxy was left perplexed.

In 1973 the Conservative government attempted to suppress wages as inflation skyrocketed and in doing so provoked violent strikes. Whatever approach the government took it seemed that the trade unions were a significant obstacle. Ted Heath decided to slam the breaks on the economy, immediate freezes were introduced on wages, prices and even profits. It was a last ditch attempt to control the economy and the stock market panicked at the suggestion of a freeze on profits. Then came the OPEC protest against the Yom Kippur War, in which oil prices were hiked up by 400% and the consequent price shock led to rates of inflation as high as 27% by the mid 70s. The British economy fell into a catastrophic crash as a result, even though the explosion of oil profits flowed to British energy corporations and the rise in price made North Sea Oil increasingly profitable. Finally amidst industrial action, power cuts, a three-day week and out-of-control inflation the Heath government lost power in 1974. But the post-war settlement had been further undermined. The suggestion that the economy could even be managed began to breakdown.

The Science of Money.

None of the traditional methods of Keynesian economics seemed able to resolve the problems in the UK economy in the 1970s. It began to look as though any attempt to pump money into the economy for the purpose of growth was doomed to failure. The proponents of monetarism came on the scene with a theory which seemed to provide technical solutions to the bizarre situation. There was too much money chasing too few goods in the economy. To bring inflation under control it was necessary to slow down the rate of monetary growth. For Milton Friedman the economy was a predictable system governed by laws which were just as objective as the laws of science. The political project of the monetarists went as far as to further challenge the state as a planning apparatus of the economy. The beginning of the end for social democracy was set in motion a few years before as the Bretton-Woods system fell into disarray. The Nixon administration dismantled it as the system was strained by the porous boundaries to capital flows. The US government abandoned a fixed exchange rate in 1971 as gold could no longer serve as the base of international money. The US government retreated from traditional methods of control and the exchange rate was left to float.

Richard Nixon was the last liberal President of the United States, it was the Carter administration who laid the foundations for Reaganomics. Britain soon became enthralled in the same economic theory in the late 70s. Perhaps then we might deem Harold Wilson the last social democrat to stand as Prime Minister of the UK. The country was immersed by desperation as Britain seemed doomed to descend into a gray mediocrity and in 1976 Harold Wilson resigned. The resignation came after a persistent smear campaign against him by a small faction of ultra-rightist MI5 agents - who thought Wilson was a Soviet spy sent to destroy Britain. It was just one of a few plots - which were never followed the logical conclusion - within the Establishment, it went as far as plans to install Lord Mountbatten as Prime Minister and the formation of private armies to fight unions in the event of a General Strike. The resignation opened up a void in government, Tony Benn, Michael Foot and Denis Healey came forward in competition with Jim Callaghan, Anthony Crosland and Roy Jenkins. The right-wing of the Labour Party came on top with Jim Callaghan winning.

A New Game.

That same year Britain fell into the abyss and faced bankruptcy so the government turned to the IMF for  a loan, the catch was a prescription of economic reform. The nature of the economic reforms were clear at the Labour Party Conference that year when Prime Minister James Callaghan stated "We used to think that you could spend your way out of a recession and increase employment by cutting taxes and boosting government spending. I tell you, in all candour that, that option no longer exists insofar as it ever did exist. It only worked on each occasion, since the War, by injecting a bigger dose of inflation into the economy on every occasion followed by a higher level of unemployment as the next step." The IMF came to the rescue later that year and Milton Friedman was awarded the Nobel Prize in Economics, this demonstrated the shift in paradigm as monetarism came to the forefront of economic theory. By now there was a new leader of the Conservative Party, Margaret Thatcher had surrounded herself with monetarists such as Keith Joseph. The road was clear as the people became increasingly disillusioned with the Labour government.

Holism, White Whines & Multiculturalism.

 The White Whine.

In 1968 Enoch Powell delivered the notorious 'Rivers of Blood' speech in which he speculated that "in 15 to 20 years time the black man would have the whip hand over the white man." The speech is often invoked by the radical Right as prophetic of the "failures" of multiculturalism, with it's liberal ideas of tolerance, diversity and equality. So whenever there is a suicide-bombing we are reminded that "Enoch was right" supposedly. Enoch Powell was the first to remind us he was right in 1981 when he saw the riots of Brixton and Toxteth. Coincidentally these riots were the result of the economic policies of Margaret Thatcher, which Powell had supported and actually promoted for years. So the calls for voluntary repatriation from Powell provided a cover for the consequences of monetarism, when mass-privatisation and deregulation lead to the devastation of the working-classes there is a need for a scapegoat. For Powell it was clear that the scapegoat had to be black.

Today it is typical to hear about the "multicultural experiment" that began in the 1960s or vaguely after WW2 with a massive influx of immigrants from the West Indies and later India. Actually the tradition of the British Empire was to allow all people loyal to the British monarchy into the country and it was only when the Attlee administration introduced the Nationality Act that this practice became formal. Enoch Powell believed that his speech might put Ted Heath on the spot, a situation from which he might then capitalise on. If the Conservatives failed to defeat Labour in 1970 Powell could have challenged Heath's leadership and then lead the Party on a populist ticket against Wilson in '74. Instead, Ted Heath marginalised Powell and won the General Election. Ted Heath pushed through the Immigration act of 1971, which restricted immigration even further than the Commonwealth Immigrants act of 1962 - which had restricted immigration to people who had been allocated work vouchers - and immigration was almost put to a complete stop.

It is often forgot that Enoch Powell was a monetarist and a proponent of small government, which has made him influential amongst Thatcherites. So he was no fan of Europe, budget deficits and immigration, but Powell was a fan of the privatisation of public services. Powell was born into the lower middle-class, he joined the army and aspired to become the Viceroy of India without serving on the battlefield. After Indian independence Powell drew up a plan to reconquer India. Powell was also a classicist and served as a Lieutenant-Colonel in Northern Africa in the Second World War, it was not a heroic service though it was marked by an amusing incident in which he burned his moustache when trying to get a fire going. Though Powell did think he was the right kind of man to rule over millions of black people. He hated Neville Chamberlain for selling Britain out, not for appeasing Hitler specifically, and was always deeply troubled by the decline of Britain as an imperial power. In a nutshell, the 'Rivers of Blood' speech was a white whine and nothing more.

On a regular basis we still hear the white whinging today about immigration, even as we are entering a pensions crisis which may be avoided through immigration. The presupposition of such whinging is that the liberal doctrine of multiculturalism has been imposed by the state through mass-immigration for decades which has undermined British values and led to division in society. Immigration has not been left to flow without a stop for decades, it has been opened up and closed before being opened up a little bit and closed once more. The class divisions in British society are far bigger than 'cultural' divisions created by immigration. As for British values, there were never any to begin with and that is because there has never been a British nation. The notion of multiculturalism has never been a consistent part of policy. But it has merely been talked about an awful lot whilst partially initiated only as far as the tendency of the market is towards pluralism and relativism.

A Community of Communities.

The liberal conception of multiculturalism is insufficient, putting aside cultural relativism as it's disturbing manifestation in South Africa is too often overlooked. Officially apartheid was initiated to separate the multitude of tribes and ethnic groups into Bantustans in order to prevent such groups from "drowning" in white culture. The racist hegemonic nature of multiculturalism was not obfuscated in South Africa, rather it was taken to its most logical conclusion and the African National Congress were labelled "terrorists" by the regime. The cynical liberal wisdom was supplanted with white nationalism and we can see this in Holism as propagated by Jan Smuts. Holism held that the world is composed of wholes, each of which constitute a grand system that can sustain and stabilise itself. The stability of the system was guaranteed by the arrangement of wholes, provided each whole remained in the right place the system could be maintained. Every whole is made up of small wholes which are evolving and will inevitably come together to form larger wholes until finally becoming part of a single unified whole.

At the time Holism provided a justification for British imperialism and racial segregation. The Empire was the self-organised system; the wholes were the lands colonised along the way. To guarantee the order of such a system it was imperative that the wholes be kept in place. The essence of Smuts' argument was that the blacks have to be kept in their place otherwise the natural order will be disturbed beyond repair, from whence the idea of the Bantustan comes. The liberal vision of multiculturalism offers us a conception of society as a community of communities, each with a distinct identity and set of moral values which is appropriate to that community. Then we find ourselves witnesses to the condemnation of homosexuality in one community and the election of politicians by another community to defend gay rights. In the Netherlands we have seen the gay community rally behind the nationalists against the Muslim community in this way.


Typically there is no mention of the white community in all of this, but that is not because multiculturalism is racist to white people as the reactionaries claim. The notable similarities between liberal multiculturalism and Apartheid proves such a claim absurd. The presupposition of multiculturalism is that the white community is hegemonic, it is the dominant community into which all other communities can be meshed neatly. In multiculturalism it is the neutral framework which protects each culture so that it can thrive in its appropriate way. The Harm Principle is invoked as a way of setting limits to such 'thriving', but even the limits of the Harm Principle are not clear enough and we find ourselves demanding the average Muslim to become a white middle-class liberal. Because liberalism works best when everyone is a fucking liberal! The forces of the market lean towards pluralism, but these same forces require a reaction against such pluralism in order to defend the market as Enoch Powell demonstrated.

There is a genuine need for a common project which is universal in nature, international in scope and radically egalitarian all at once. In Tahrir Square there was a common struggle against Mubarak which united Muslims and Christians. There have also been instances in which Muslim women in traditional dress and lesbian Jews have been brought together in protest against the Israeli government. These are just glimpses of what is possible at a societal level of solidarity. The liberal form of multiculturalism offers a decaffeinated Other, a Muslim community without a Muslim community. The nationalists drive this to it's logical conclusion and call for bans on the veil, halal meat and so on in defence of freedom. To put it bluntly the dichotomy of the debate is shaped by the contradictions of the economic system and the way fascists respond to such contradictions from a managerial perspective. We need to make radical changes if we want to construct the universalist alternative to multiculturalism and fascism.

All Watched Over by Machines of Loving Grace.

THE RISE OF THE MACHINES AND THE DREAM OF A STABLE WORLD WITH NOVELISTS, ANIMALS, THE WORLD WIDE WEB, PRESIDENTS, LOVE, CYBERNETIC PROPHETS, A BALANCED ECOSYSTEM AND A SAFE PAIR OF HANDS.

Good news fellow travelers, Adam Curtis is back with a new documentary series called All Watched Over by Machines of Loving Grace, it's title was borrowed from a poem by Richard Brautigan, it looks to be typical of his style and quality. Apparently the "vertigo-inducing intellectual leaps, choppy archive material and disorienting music" will be included in the package. The central focus of the documentary is the way computers have not liberated us, contrary to popular belief and instead we have lost our vision in a disillusioned age of managerial post-politics. Engrained in computer systems are notions of a perfect balance in ecosystems, ideas which go back to the hippies but have made the leap to Silicon Valley and then onwards to Wall Street. With some contributions from Ayn Rand and Richard Dawkins along the way of course, we know Enron couldn't have done without the selfish gene and free-market fundamentalism.


The pseudo-spiritualism of hippie counter-culture in the 1960s with it's communal living, free love, experimental psychedelia and emphasis on the balance of nature's ecosystems have had a great deal of impact over the trajectory of recent decades. It was a cultural revolution of sorts, the individualism of which has since been harnessed by the system. Some of the hippies went on to be major figures in Silicon Valley, the ideas of a natural equilibrium have been built into technology. Now we have social networks as the sign that we are all free and connected, even in love. The idea of a economic equilibrium is appealing to radical free-marketeers like Ayn Rand with her devotee the Chairman of the FED Alan Greenspan. Once we have made the links between hippies turned soft-ware capitalists, Objectivism and the economy we can easily greet Richard Dawkins with his ideas about the selfish gene. But these are just my thoughts on some of the issues Curtis looks at.

WE LIVE IN A DREAM WORLD CREATED BY THE MACHINES WHERE WE ARE ALL CONNECTED AND WE ARE ALL FREE. EVEN IN LOVE. BUT THE MACHINES BROUGHT WITH THEM ANOTHER IDEA, THAT WE ARE ALL COMPONENTS IN SYSTEMS – NODES IN A GLOBAL NETWORK. WE DREAMED THE SYSTEMS COULD STABILISE THEMSELVES, THROUGH FEEDBACK, AND CREATE A PERFECT BALANCE IN NATURE’S ECOSYSTEMS. AND IN HUMAN SOCIETY. AND IN CAPITALISM. WITHOUT POLITICS AND THE OLD HIERARCHIES OF POWER. BUT POWER HASN’T GONE AWAY. IT NEVER DOES.

Adam Curtis was "inspired" to make this documentary when he watched amateur footage of a mass experiment that took place in 1991 and was hosted by Loren Carpenter. Hundreds of people were given a paddle and told nothing, but when a big screen in front of them projected a game of Pong all of them began to participate. The people had to operate it together, spontaneously and without any preparation, in the end they succeeded in playing a game of Pong. Loren Carpenter saw the experiment as freedom and order manifested. For Curtis the people were not free at all, in the self-organising systems we are expected to be "happy components" in a machine and our only duty is to stabilise the machine. We are all just cogs in the machine, each important in a way though as a mass the individual cogs are irrelevant and only matter in relation to the machine working smoothly.

Katharine Viner was right to emphasise the focus on power in the documentaries Curtis has churned out over the last 20 years. With Pandora's Box (1992) it was the use of science to control society and shape human beings. Similarly The Mayfair Set was about the collapse of political rise and rise of corporate power. The Century of the Self looked at the rise of Freudian psychoanalysis and the appropriation of Freud's theories by the public relations industry to market goods to consumers. My favourite is The Power of Nightmares in which politicised fear is explored as the only way for politicians to mobilise people in a disillusioned age. Now Curtis has moved onto machines and the way that the idea of a self-regulating ecosystem in nature has been torn from the thoughts of hippies and has become engrained in technology. The idea of a natural equilibrium eliminates the reason for the state and automatically writes-off all possibility of state-intervention. In this sense, the commune is a model for social networking as it is self-regulating and non-hierarchical.

Adam Curtis has also worked with Charlie Brooker in the past and has recently written for The Guardian in the aftermath of the death of Osama bin Laden. He argued that the death of bin Laden may herald the end of a grand narrative which has served American politicians, Western journalists and Islamists well in making sense of the world. It is only a question of what kind of narrative will open up to make sense of the world now, Curtis speculates that it may be the rise of China which will give America a reason to reassert itself in the world. This could be true as there has already been a great deal of emphasis on American decline and Chinese ascension in the mainstream discourse. Donald Trump made a big deal about imposing a tariff of 25% on imports from China. He might be right unless the Obama administration finds a way to maintain the current narrative of terror. As I am a fan of Curtis I will be making a post for each episode of his new series and I strongly recommend his work to all reading this article.

Where's the Theory?!

Comfortable Illusions.

The lack of a theoretical case for the cuts may be indicative of a new era we're entering, a political age without shame, instead of the old hegemony we find blatant domination. Even the Thatcherites had a combination of monetarism and rational expectations in the early 80s to fall back on, it was this combination which Thatcher used to defend a platform of spending cuts and raising interest rates to reduce the money supply. The theoretical framework, from which an economic platform could be defended, could be embellished with gestures of traditionalism and nationalism. For Keith Joseph there was something about the monetarist project which had the aura of a messianic mission, a belief that it could rejuvenate Great Britain and restore the glory of Empire. There is no such clear zeal in this cabinet for a particular theory or even a school of thought, merely a self-proclaimed pragmatic dedication to the national interest.

Really, the Conservative Party are the embodiment of the class-interests of the rich and the practicality of a policy can be measured by how much it affects the wealthy. Thus, the economic strategy laid out by the artful oik George Osborne has no clear theoretical base or even a loyalty to a specific school of thought. The criticism of the British government has come from the IMF and monetarists like Samuel Brittan. There has yet to emerge a clear economic theory in defence of the cuts, all we have had for years now is fear-mongering about the debt that our grandchildren will inherit. Even Larry Summer, the Ariel Sharon of Higher Education, has described the austerity measures as "oxymoronic". Of course, the Right who support these cuts in Britain will remind us that the Obama administration has recently unveiled plans to cut the US deficit at a rate faster than the British. No mention of the incompetence of Geithner. No mention of the role Geithner played in creating the crisis.

Despite what is claimed in the media there is nothing new about government debt, practically all governments work with debt and the logic is one of "return on investment". The government can borrow money to invest in productive capacity to create jobs and stimulate demand, whereby a recovery may be secured and the tax-revenues can increase. The rate of spending in a recession can be justifiably increased along these lines. Keep in mind that the deficit is not the result of "over-spending" as the Tories claim, in a recession tax-revenues go into sharp decline because of rising unemployment and businesses going bust. As the tax-revenues are in decline then spending, which would normally be sustainable, becomes unsustainable and debt is inevitably increased even if the expenditure is not raised. The narratives that the Right are trying to build around the crisis are counter-historical as well as counter-theoretical. The traditional way the economy recovers from a crisis is through spending and borrowing, not by cutting.

The "debt crisis" that the commentariat and the political class are obsessed with is a complete fiction. The current levels of debt are low by historical standards, just take the high estimated 70% of GDP which government debt adds up to and compare it to the 260% of GDP which debt accounted for in 1945. There are alternatives to cutting to decrease the debt, we can boost economic growth through public spending but there are other options as well. We might consider Greg Philo's proposal to implement a wealth tax on the richest 10% of the British population - who have accumulated £4 trillion in wealth. There is a mythology which has been created in the media over the last couple of years, which pins the blame of the deficit on benefit claimants and immigrants in the usual manner. As a proportion of GDP debt repayments were around 7% in 2010 and in 1997 the repayments were around 9%. New Labour paid a lot of debt back and spending was not "out-of-control" under them.

Spawn of Thatcherism.

The management of a deficit typically takes into account major indicators such as growth, interest rates, exports and so on. So the aim of a zero-deficit by 2015 is either a sign of economic illiteracy or cunning on the part of the oik. It is as if Osborne looked at his calendar, saw when the term will run out so he highlighted the date and now we're on track for General Election 2015. This does not smell at all like pragmatism or even business ontology, it could be that the aim is to push the plans ahead as far as possible - before the economy starts to tank and public opposition becomes insurmountable. We might even see a U-turn as seen under George HW Bush on tax-cuts, when his administration saw that the deficit could not be reduced through tax-cuts for the mega-rich. It cost him his second term, but in the case of the Tories and Lib Dems a sudden change in trajectory would probably prolong their stay in government (depending on the details). But it would only provide another opportunity for market reforms and privatisation.

Paradoxically, the spending cuts have the potential to increase the debt as seen in the late 1970s when some economies initiated sweeping cuts to spending. There are only a handful of cases in which austerity measures have promoted growth. Even with the cuts that smashed the British economy in the early 80s, the recovery had little to do with the cuts and a lot more to do with the supply-side stimulus in the United States and financialisation which regimes in South-East Asia at the centre. For the sake of argument, let's assume that the cuts work out and that the economy recovers fully within the next couple of years. The contraction of the economy might only be avoided in such a scenario if aggregate demand is not decimated. The losses in wages could be supplemented through credit, as seen in previous decades, which would necessitate the rise of debt per household.

So here we are one year into what The Times called the Five Year Plan of the Con-Dem Coalition, only the Murdoch press could imply such a tendency in a majority government of neoliberals - the spawn of Thatcherism. We've just lived through Year One and we have already seen protests against the party-line of "CUTS!" with estimates ranging from 500,000 to 850,000 of those who took to the streets on March 29th to demonstrate against austerity measures. All along there had been talks about cuts across the board and market reforms in the usual areas, with Cameron trying to put a 'moderate' stamp on the Conservatives and then a 'progressive' stamp on the Coalition. So that the reheated slop of Blairism can be smuggled into government via the backdoor. Of course, I use the term Blairism to refer to the reinvention of Thatcherism through the mirage of centre-leftism and quasi-evangelical rhetoric of Tony Blair. Now the Con-Dems have used the claims to leftism by New Labour to grind down what remains of the welfare state.

We have seen the beginning of the spending cuts, a sprinkling of privatisation and market reforms, for example health-care reform is still on the table, though attempts to privatise the forests were stopped and cuts in education have been 'moderated' slightly. We've seen Tories talk with glee at the possibility of cuts that Margaret Thatcher could only dream of and we have seen large-scale activism against the austerity measures. Soon the majority of universities will be charging £9,000 and the Institute for Fiscal Studies has predicted that 200,000 children will be pushed into poverty by the cuts. Ironically the plan to reduce public debt by £43 billion could lead to household debt rising from £1.56 billion to £2.13 billion by 2015. So the Rally Against Debt was actually a Rally For Debt. At this point we have to keep going to force the Coalition into compromise just before the axe can be swung again.

Heretical Truths about Thatcherism.

The rise of monetarism came in the 1970s when Keynesian economists were baffled by stagflation. The orthodoxy of the day was rattled by the continued rise of inflation, alongside a rise in unemployment, and monetarism provided a theoretical answer to the crisis. It was the consequence of spending more than we produced and inflation was caused specifically by too much money chasing too few goods. The transition from Keynesianism to monetarism came before Thatcher, Callaghan began to use the theory to explain the problem of inflation that had wracked Britain since the war. The purpose of economics began to shift from job creation to combating inflation as Britain accepted a loan from the IMF in 1976, which stipulated huge cuts to public expenditure and deficit reduction. As a result interest rates were lowered, the value of the pound increased and the balance of trade began to improve because of new oil revenue. The crisis forced Labour to consider scrapping nuclear weapons.

In 1979 Callaghan was booted out of office and Margaret Thatcher was elected Prime Minister. Inflation had risen over 10% and unemployment was continuing to rise, monetarists argued that higher interest rates and lower spending would lead to less inflation. By 1980 under Thatcher the cuts to public spending led to even higher unemployment and inflation doubled in spite of the fiscal squeeze. By 1981 interest rates had to be lowered in order for the exchange rate to be reduced, the hope was that this would lead to an increase in exports. Thatcher opted to cut even more in order to keep up appearances with monetarism, which it could not publicly dump for the sake of rational expectations. These expectations demanded consistency of government, as a way of maintaining the illusion of integrity and avoiding bad press. As a consequence of rising unemployment, as well as the strain of inflated prices on citizens, the country was shaken by riots.

When inflation finally began to fall the money supply was actually still rising and it could be that the rise in unemployment led to the fall in inflation. In 1982 it appeared as though the Thatcher government was walking into the election equivalent of an abattoir, wherein the Thatcher cabinet would have been slaughtered for the economic destruction of the preceding 3 years. The Falklands War is what doubled the popularity of Thatcher, which left 910 dead, as the rising tide of nationalism gave them something to ride into the election against socialist Michael Foot. The War became a football match with guns, the people were mobilised through 'national pride' to save Thatcherism. In a post-colonial era of decline Britain was particularly vulnerable to despair, especially given the reliance on tradition to uphold the fabric of society rather than a constitution as in the US. So it should be a surprise that the Thatcherites were able to surf on a tidal wave of jingoism into a second term in 1983.

Triumphantly the Thatcherites then moved to privatise gas, electricity, telecommunications, steel and the airline. The government effectively declared war on the unions, the point at which the ideological battle shifted in full to the favour of government was when the Miners' Strike was finally brought to an end in 1985 with the defeat of the NUM. The concerted effort to crush the unions went as far as M15 surveillance . The impact of the defeat could be seen by 1990 when the working-class were subject to some of the biggest wage-cuts in the world and the number of poor in Britain had increased by 100% throughout the Thatcherite era (1979-1997). The gap between rich and poor peaked in 1991, though Britain is still far more unequal than it was in 1968 and the impact of inequality has been seen in various forms of social deprivation. It has been estimated that the costs of the increased inequality and unemployment to lie within the range of 5% to 8% of GDP, compare this to the productivity (which increased alongside wages before Thatcher) gains of 5% to 10% under Thatcher.

Inflation finally dropped to 3% in 1986, but monetarism had been quietly discarded by the Thatcherites long before. It was in 1985 that Margaret Thatcher claimed to have never subscribed to some of the theories of Milton Friedman. The theories of monetarism would be replaced by Goodhart's Law which held that if the government ever adopted a particular theory or doctrine as a basis for policy, the relationship between theory and policy would quickly fall apart. The government was incapable of creating a better world, therefore it should not disturb the markets too much and leave individuals to make the best of the situation. Later the destruction caused by the policies would be "justified" by a boom which ultimately led to the Crash of 1987 and ended in the recession of the 1990. The financial crisis in 1987 came just after the election and Thatcher was safe until 1990, when events would lead to her being ousted so that John Major could lead the Tories to victory once more in 1992.

The neoliberal theories of Milton Friedman came to influence policy and were the expression of a convergence of particular interests manifested in government, in order to devastate the working-class that had done so well in the post-war settlement. By raising unemployment and crushing the unions Thatcher succeeded in creating a reserve army of labour that would be desperate enough to work for stagnant wages. Similarly the work of Adam Smith was used as window-dressing. This can be seen in 1990 when some of the biggest wage cuts hit the working-class in Britain, which could generate greater profits. The selling-off of council houses and the deregulation of finance opened up possibilities of investment for the future, just as manufacturing began to go into decline, where money could be made from money and not wasted on unprofitable ventures. This has been the source of boom years ever since the late 80s, property and finance have taken the place of industry.

The boom of the 80s was a result of the deregulation of finance, a huge increase in arms deals and a property boom created by the selling-off of council houses. The low interest rates were conducive to the property boom. The tax-cuts increased the wealth of the richest 10% of the population, majority of investments were made in property and finance where there were stupendous profits to be made at the time. Manufacturing went into decline and employment in that area declined by 30% between 1979 and 1990. Though it should be noted that the boom had little to do with Thatcherite cuts, the recovery had a lot to do with international events as there was a supply-side stimulation in America that helped keep Britain afloat for a while. Similarly the deregulation of finance in Britain coincided with a new regime of accumulation kicking off in South-East Asia. It was only a minority of people who benefited from the boom, rates of growth might have fluctuated around and above 5%, but the growth was not unprecedented by historical standards.

The fall of Thatcher in 1990 came after the Poll Tax demonstrations descended into riots in Trafalgar Square, unemployment 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. Without the leader that had never been as popular as her own party the Conservatives secured one last victory and remained in office until 1997. After 18 years of Thatcherism the public expenditure had returned to slightly over 42% of GDP, which is what it was when she took over. Just as the rates of growth had not been spectacular (though profits were stupendous) nor was the "reduction" of debt and the "rejuvenation" of Great Britain, which was left broken and unequal. The images of the 80s as crass and flamboyant, that we all know, represent the zenith of Thatcherism which had made a minority of citizens very rich from privatisation, deregulation of finance and the exploding cost of real estate.