Gordon Brown’s latest answer to the recession is to spend his way out of it. Having defended the dogma of the free market for the past ten years, he has now shifted to talk of state intervention and Keynesian economics.
This has led some to celebrate Labour’s “shift to the left”. But in reality there are massive limitations to the government’s position, alongside a nasty agenda of attacks on working class people.
Much of the spending that has been announced is not new, but is simply being brought forward. Even these sums are tiny compared to the £500 billion earmarked for bailing out bankers.
This week incapacity benefit was abolished, to be replaced with an “employment and support allowance”. The government’s stated aim is to force a million disabled people into work – at a time when the number of job vacancies is shrinking fast.
The current scandal over links between business secretary Peter Mandelson, senior Tories such as George Osborne and the Russian billionaire Oleg Deripaska is a reminder of the class that New Labour represents.
The party has gone out of its way to make life easy for the ultra-rich. Foreign billionaires that have snapped up property in London have been given “non-domicile” status, which exempts them from paying tax in Britain.
New Labour’s strategy is based on supporting their rich friends and keeping the system that makes them rich afloat.
As the recession bites, the party can be forced into making some concessions for ordinary people – or at least talking about making them. But its overwhelming goal remains to try and make workers pay for the crisis.
The scandal over energy prices bears this out. Energy giant BP announced on Tuesday a massive 148 percent rise in profits over the last three months, yet Labour has refused to introduce a windfall tax on these profits.
This is despite calls from union leaders such as Unite’s joint general secretary Tony Woodley, who said, “It is time to put an end to this obscene profiteering.
A windfall tax on the oil giants would help six million people heat their homes this winter.”
Meanwhile New Labour is caving in to a vicious right wing agenda on issues such as crime and “anti-social behaviour”.
Justice secretary Jack Straw this week attacked people who campaign for prison reform, branding them the “criminal rights lobby”.
And for all the government’s talk of intervention to defend the system, it refuses to defend workers’ rights. The chancellor Alistair Darling confirmed last weekend that he would not stop the banks the government now owns from sacking their workers.
The stock market crash has led to “defined contribution” pension schemes losing £157 billion in their value over the past year.
But the government has said nothing about compensating workers for this shortfall, let alone raising the state pension to a decent level.