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The battle lines in Blair’s second term

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Issue 1753

Building opposition to New Labour

The battle lines in Blair’s second term

By Chris Harman

“THE SECOND term will be bloody.” That’s what an unnamed cabinet minister told Observer journalist Andrew Rawnsley in the middle of the election campaign. They are certain to be right. New Labour is about making British capitalism more profitable and competitive, regardless of the cost to the mass of people. This is despite the fact that Labour’s vote fell by 2.8 million votes as many could not stomach voting New Labour.

Rupert Murdoch’s Times newspaper referred to this in an editorial two days before the election. It said Blair would have to use “Thatcherite means” to address the lack of investment in public services. Margaret Thatcher set out to tear into workers’ conditions in the core industrial sectors-steel workers, miners, printers and dockers. Blair now wants to carry the same logic into public sector services like education, health and the Post Office.

The call for “reform” of public services ran like a blue line throughout Labour’s manifesto. “Reform” means cutbacks, speed-ups and unsociable working aimed to squeeze more from less. It means more privatisation to increase big business profits. There were signs even before voting took place that this was producing enormous tensions between New Labour and its traditional supporters. An Observer poll showed half the electorate thought the party was “too right wing”.

The Guardian has seen internal Labour Party documents showing that the party’s membership has fallen over the last four years. It is now at a record low of 280,000-as against 400,000 in 1997. One party member in three has abandoned the party, such is the disgust for Blair’s policies.

Throughout most of the 20th century loyalty to the Labour Party meant strikes were rare during election campaigns. Yet some 50,000 postal workers took unofficial and illegal strike action just two weeks before this election-the biggest unofficial strike for a quarter of a century. Thirty thousand college lecturers took one-day official action. London tube workers showed a willingness to strike in election week until their management made unprecedented concessions to avoid this. There is a growing desire to challenge New Labour in the unions. Just weeks before the election the Fire Brigades Union conference voted that branches would be able to use the political fund for parties to the left of Labour. This broke with all precedent.

Five days before the election a quarter of delegates to the postal workers’ CWU union conference voted the same way. There was a brief explosion of bitterness with New Labour’s plans even among the top ranks of the TUC.

Its 20-strong executive met a fortnight before the election, shellshocked at the tone of Blair’s manifesto. They vented their fury in private, with much talk about betrayal. Typically they then kept quiet while union funds were spent glorifying Blair’s election image. They will not be able to keep quiet forever. The surprise victories in union elections of left wing “outsiders”-Mark Serwotka and Billy Hayes-will have sent a shiver down the back of every general secretary.

Radio 4’s Today programme says that “the most powerful general secretaries are preparing to blow their top after the election”. Already the UNISON union executive is recommending to its conference a resolution that talks of strike action against privatisation. The CWU’s defeated candidate in the general secretary election, John Keggie, says a national post strike is inevitable later this year. On past form the union leaders will do their utmost to avoid any confrontations. We can expect them to give the go ahead to local official strikes, like the Watford post workers or the Dudley hospitals workers, to try to head off national action.

But the way Watford turned into a mass unofficial strike shows how they cannot control things completely. From one direction Blair is pushing ahead with his “reform” schemes that will attack the conditions of unionised public sector workers. From the other direction union leaders fear growing pressure from below if they do not at least pretend to stand up to him. The pressure will grow as other groups reflect on the successes of the post and tube workers. The claim that strikes cannot win-endlessly repeated by the union leaders since the miners’ strike-is beginning to wear thin. All the time, another factor will be feeding bitterness with New Labour-what is happening to the economy.

The government was remarkably lucky in one respect in its first term. Recovery from the deep recession of the early 1990s led to most employed people experiencing an increase in the real value of their wage packets. Also, there has been a real fall in unemployment, although the government’s figures considerably exaggerate this.

William Keegan of the Observer has pointed out, “The rise in living standards (as measured by average annual growth in real disposable household income) has been 2.3 percent a year under Labour.” The average is boosted by the huge bonuses of City parasites, and many workers have paid for any improvement by working longer and harder. Nevertheless, most people have felt a little better off than in the terrible days of the early 1990s.

But, and it is a very big but, this situation is not likely to be sustained. British capitalism has not overcome its historic weaknesses compared with European, North American and Japanese capitalism. This is shown by the continuing decline in manufacturing industry and a growing trade deficit.

The economy has managed to keep growing largely because people are borrowing more. Lending to individuals hit a record 3.48 billion in April, according to the British Bankers’ Association. That is up 13 percent from the previous record in June 2000. But this is not a state of affairs that can continue indefinitely, particularly as the US economy goes into recession. William Keegan is almost certainly right to conclude, “This is the just in time election. Real economic difficulties facing New Labour are not going to show up fully until the second term.” Blair and Brown may talk endlessly of “no return to boom and bust”. But there are many signs that the boom that gave them election victory is going to end, as booms always do, in some sort of bust.

Economic problems often hit governments when they least expect it. It is never possible to tell in advance exactly how an economic crisis will work itself out. But it is easy to see how bitterness can grow among very large numbers of people if the downturn in manufacturing spreads to service industries. Many people have only been able to take any part in the boom by borrowing for fashionable consumer goods and massively overpriced housing. They can become very angry when job cuts and pressure on wages make it impossible to pay off the bills.

Any downturn means lower tax revenues and higher social security spending. The government would find it difficult to finance even the small increases in the numbers of doctors, nurses and teachers that they have promised. Tony Blair has repeatedly ruled out any increase in taxes on the rich to balance the books. His alternative will be to squeeze workers more, and open still more areas up to privatisation.

Every Labour government has ended up spreading disillusion amongst its own supporters. In the past the beneficiaries have been the right-the National Government in the 1930s, Churchill and Eden in the 1950s, Heath in the early 1970s, and Thatcher in the 1980s. This time there is a difference. There is a visible presence to the left of Labour, while the Tories are still almost out of the game. We have to expand this alternative in the weeks after the election on three different fronts:

  • The 185,000 people who voted for socialist candidates in the election represent a pool of people who can be drawn together. We need to make sure there are forums for them to meet and act together around issues other than just electoral ones.
  • Building the anti-capitalist movement that began at Seattle and heads for Genoa on 20-21 July.
  • Building the rank and file networks that have begun to emerge in industries like the post, the health service, the tube and the car industry.

It is not a question of waiting for New Labour to make things bloody, but of preparing urgently for that challenge now.

“OPPOSITION SEEMS likely to express itself increasingly from outside the mainstream political system. Objections to market capitalism are being most strongly expressed on the streets, as in Seattle and Prague. And the biggest obstacle to Mr Blair’s programme in his second term will come not from the Conservatives but from unions representing public sector workers and from protesting interest groups.”

  • JOHN PLENDER, Financial Times, 2 June

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