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From International Socialism 2 : 129, Winter 2011.
Copyright © International Socialism.
Copied with thanks from the International Socialism Website.
Marked up by Einde O’Callaghan for ETOL.
We enter 2011 in a situation marked by both continuity and – in Britain, at least – dramatic discontinuity. The element of continuity is represented, of course, by the global economic and financial crisis. Change comes in the form of the sudden emergence of the first real social movement in Britain for many years, the protests by university and school students against the near-trebling of tuition fees. The night a House of Commons surrounded by students fighting riot police voted for the increase, a visibly shaken Nick Robinson, BBC Political Editor, said: “The government may have won a vote, but they may have lost the argument, and lost control of the streets.”
Continuity first: the crisis is now well into its fourth year, but shows no signs of ending. This is not because there is no economic growth. The November survey of purchasing managers suggests manufacturing output is rising in Germany, France, Britain, China, and India. But in its latest World Economic Outlook, published in October 2010, the International Monetary Fund (IMF) was gloomy:
The global recovery remains fragile, because strong policies to foster internal rebalancing of demand from public to private sources and external rebalancing from deficit to surplus economies are not yet in place. Global activity is forecast to expand by 4.8 percent in 2010 and 4.2 percent in 2011, broadly in line with earlier expectations, and downside risks continue to predominate. WEO projections are that output of emerging and developing economies will expand at rates of 7.1 and 6.4 percent, respectively, in 2010 and 2011. In advanced economies, however, growth is projected at only 2.7 and 2.2 percent, respectively, with some economies slowing noticeably during the second half of 2010 and the first half of 2011, followed by a reacceleration of activity. Slack will remain substantial and unemployment persistently high. Inflation is projected to stay generally low, amid continued excess capacity and high unemployment, with a few exceptions among the emerging economies. Risks to the growth forecasts are mainly to the downside. [1]
In fact the problem is much broader than the famous “imbalances” in the world economy on which the IMF focuses. The recovery is both shaped and undermined by the desperate measures the leading capitalist states took in autumn 2008 to prevent the financial crash producing a global economic depression on the scale of, or perhaps even deeper than, that of the 1930s. The sheer scale of the efforts, particularly by the Federal Reserve Board, the US central bank, is only now becoming clear.
Figures released in early December show that between March 2008 and May 2009 the Fed extended a cumulative total of nearly $9 trillion in short-term loans to 18 financial institutions. These included not just American banking giants such as Citigroup, Merrill Lynch, Goldman Sachs, and Morgan Stanley, but foreign banks with US interests, including Barclays, UBS, and RBS, and issuers of commercial paper associated with non-financial companies like Caterpillar, McDonald’s, Harley-Davidson, and Verizon. [2]
These measures prevented total collapse, but not the most severe economic slump since the 1930s in the winter of 2008-9. And the scale of increased public borrowing caused by the crisis and by the state rescue of global capitalism is the first of the major problems to dog the recovery. In 2009 budget deficits grew by five percent of national income in the advanced economies. [3] The financial markets, in alliance with the broader neoliberal coalition pressing for austerity measures to slash budget deficits, have defined the problem as the crisis of sovereign debt.
Since the spring of 2010, this has sent wave after wave of instability through the eurozone as vulnerable states are targeted by the markets and subjected to the tender mercies of “rescues” mounted by the unelected troika of the European Central Bank (ECB), IMF, and European Commission – first Greece, then Ireland, and who next? Portugal? Spain? Italy? Belgium? There are fears that the emergency €440 billion European Financial Stability Facility set up in May may soon be overwhelmed by the demands on it.
“One could be forgiven for thinking the market is a bully who cannot be satiated, as he looks for his next victim,” commented Suki Mann, head of credit strategy at Société Générale. [4] Even Germany, Europe’s strongest economy, has felt the power of the markets. Chancellor Angela Merkel spooked them in late October when she said that, under the new European Stability Mechanism that is supposed to provide a long-term framework for dealing with financial crises in the eurozone, the holders of European government bonds would have to contribute to future rescues.
The markets reacted by pushing up interest rates on the bonds of the weaker eurozone states. Steve Yardeni, who invented the term “bond vigilante” back in the 1980s, explained: “The bond investors don’t want to take a hit and if the politicians make them take a hit they will close the markets down”. [5] Merkel told the German parliament: “This is about the primacy of politics, this is about the limits of the markets,” but so far the markets seem to be winning. [6]
The sovereign debt crisis then interacts with a second crisis – that of the banks. The dramatic state interventions in autumn 2008 were intended especially to save the major American and European banks from the consequences of the speculative gambles they had made during the financial bubble of the mid-2000s. The IMF Global Financial Stability Report for October 2010 estimates the losses the banks made in 2007-10 at $2.2 trillion. But it argues that about three quarters of these have already been written off, and that the biggest remaining problem lies in the massive borrowing, much of it short-term and raised on wholesale markets, the banks made to finance their failed bets: “over $4 trillion of debt is due to be refinanced in the next 24 months ... Wholesale funding (including borrowing from the central bank) represents over 40 percent of total liabilities in the euro area banking systems in aggregate; this contrasts with around 25 percent in the United States, United Kingdom, and Japan”. [7] Debt due to be repaid by European banks in 2011 varies from 3.5 percent of Gross Domestic Product in France to 6.4 percent in Spain. [8]
Banks in the eurozone are therefore particularly vulnerable to shifts in mood in volatile financial markets. The lead-up to both the Greek and Irish “rescues” – respectively in April-May and November 2010 – saw funding dry up for European banks. Ireland is a particularly good example of what the IMF calls “the negative interactions between sovereign and banking risks”. [9] What forced the Irish government into the arms of the troika was its decision in October 2008 to take over all the debts of the banks, which swelled the budget deficit to an astonishing 32 percent of national income. The rescued banks in recent months borrowed massively from the ECB simply to keep afloat. Yet they had passed the stress tests organised by the European Union (EU) last summer to prove the health of its banks. This begs the question of how many other unexploded mines may be lurking in the European financial system. This isn’t a problem just for the eurozone – the countries whose investors have the biggest exposure in Ireland are Britain ($149bn), Germany ($139bn), and the United States ($69bn). [10]
The eurozone crisis has been marked by serious conflicts between Germany and its EU partners. Their sources have been explored in detail in recent issues of this journal. Crucially, European Economic and Monetary Union (EMU) has widened, not reduced, the divergences among the economies participating in the euro. As Stavros Tombazos shows in a recent paper, German capitalism, through a combination of holding real wages steady and greater labour flexibility, has increased its competitiveness, not simply relative to the weaker, “peripheral” economies of southern Europe, but also by comparison with the other leading continental European state, France. This has allowed Germany to maintain its share of world exports at 9-10 percent, despite the fact that China has overtaken it as the largest exporter of goods. Berlin’s insistence that the other eurozone states adopt fiscal discipline amounts to the demand that they too embrace wage repression and labour flexibility. [11]
This hard line has antagonised the rest of the EU. It has also encouraged speculation that Germany may be willing to see the eurozone either contract to a north European rump or collapse altogether. During a row with the Greek prime minister, George Papandreou, at an EU summit dinner in October Merkel is reported to have said: “if this is the sort of club the euro is becoming, perhaps Germany should leave”. [12] France would ferociously resist either of these outcomes because it relies on an EMU broad enough to dilute German economic power to underpin its geopolitical position. However the situation evolves, the eurozone crisis highlights a third factor undermining the recovery – the imbalances between creditor and debtor states. Germany’s role as an export hub whose capital has kept weaker European economies afloat is replicated globally in the relationship between China and the US. The flows of manufactured goods and capital across the Pacific drove the economic boom of the mid-2000s – and financed the speculative bets by Western banks and shadow banks that precipitated the crash and the slump at the end of the decade.
But, if anything, the tensions resulting from the delicate mix of interdependence and competition between the US and China have grown more serious since the crisis began. The combination of a massive fiscal stimulus and huge loans by state banks to firms pulled the Chinese economy out of a growth recession in 2008-9 and returned it to double-digit growth, reviving in its wake those economies that have increasingly reoriented towards supplying China with manufactured goods and raw materials. Hence the uneven character of the present recovery, where robust growth figures in the “emerging market economies” of the global South contrast with stagnation in much of the advanced capitalist world (with the notable exception of Germany, which now directs a substantial chunk of its exports of high-end manufactures towards China).
There are real questions about how sustainable the “emerging market” growth surge is. The Chinese authorities are now grappling with the consequences of their injection of cheap credit into the economy – a serious inflationary surge and a property bubble. Moreover, depressed consumer markets in the North mean the additional exports built thanks to higher investment in China may find it hard to find buyers. But, more immediately, the uneven recovery has helped intensify both geopolitical and economic frictions between the US and China.
Chronically high unemployment in the American heartland, as Megan Trudell shows elsewhere in this journal, has helped politically to cripple Barack Obama’s administration. In November US unemployment rose to 9.8 percent. The New York Times commented: “The outlook remains bleak. More than 15 million people are out of work, among them 6.3 million who have been jobless for six months or longer. Many are about to exhaust their unemployment benefits, which have been extended repeatedly by the government because of the severity of the downturn”. [13]
The Fed’s long-trailed decision announced at the beginning of November to go for a new round of “quantitative easing” (QE2) – pumping another $600bn into the financial system by mid-2011 – marked effectively a decision to let the dollar fall against other currencies and thereby to cheapen US exports. Devaluation to stimulate a depressed economy has been pursued by successive American administrations since Richard Nixon broke the link between the dollar and gold in August 1971. But the ploy doesn’t work so well these days because the Chinese renminbi, the currency of the world’s biggest exporter, is pegged against the dollar. Faced with strong American pressure in the lead-up to the G20 summit in Seoul in November, China’s rulers refused to budge.
Obama’s failure on this front has reinforced perceptions of a US weakened by the crisis. This view is exaggerated: thus the detailed figures of the Fed’s loans in 2008-9 show the extent it functions as a global central bank, extending dollar swap lines to ten central banks, including the ECB, the Bank of England, and the Bank of Japan. [14] But undeniably the contrast between Chinese growth and American stagnation has encouraged Beijing to become more assertive – for example, over its various territorial claims in the South China sea, provoking Washington to declare the area a US “strategic interest”.
It is against this background of continuing economic crisis and growing frictions among the leading capitalist states that austerity has come to grip public policy in Europe and increasingly the US as well. Given the fragility of the recovery, rapid “fiscal consolidation” makes little economic sense. Even the high priests of neoliberal orthodoxy at the IMF estimate that cutting back on public spending proportionately reduces output and demand in the short term (though they claim it has longer term benefits) and that the effects are likely to be more severe if interest rates are very low and “when many countries adjust at the same time”, because it is then harder for exports to make up for the fall in domestic demand: both these conditions prevail in the US and Europe today. [15]
Austerity is driven by politics. It helps to maintain the dominance of the neoliberal coalition that came to power in advanced capitalism in the 1980s. Insisting that the priority lies in deficit cutting effectively takes off the agenda any reconfiguration in the relation between the state and capital, or reduction in the power of the banks. Where government is in the hands of economic liberals, as in the case of the Conservative-Liberal coalition in Britain, austerity has the further advantage of legitimising pressing much further with the free-market “reforms” pioneered by Margaret Thatcher and continued by Tony Blair.
In a book on the coalition’s formation, David Laws, its short-lived first Chief Secretary to the Treasury, reveals that, even before the general election, senior Lib Dem politicians were inclined towards sharing government with the Tories as the best way to achieve “fiscal consolidation”. Thus, as David Runciman observes, “the Lib Dems were already signed up to the Tory position on the economy before negotiations had begun”. [16] Laws stresses the ideological affinities binding the coalition together: “The economic liberalism of the Conservative Party and the social liberalism of the Liberal Democrats have been convincingly combined. And the liberals in both parties are now firmly in charge”. [17]
The political scientist Anthony King told the Financial Times: “This government has moved more radically and rapidly than perhaps any other since 1945. The only comparison is with Margaret Thatcher in 1979, and even then it took her much longer to set out the plans she is remembered for. The jury is out, but the speed of this is quite something.” [18] Naomi Klein’s “shock doctrine” is a poor explanation of neoliberalism in general, but the radicalism of the coalition’s assault on the welfare state certainly fits with Milton Friedman’s prediction that “only a crisis – actual or perceived – produces real change ... [Then] the politically impossible becomes politically inevitable”. [19]
But if, as Ross McKibbin puts it, “the importance of the cuts is not economic but political and ideological”, they also have a political downside. [20] This is, quite simply, the mass resistance that they may provoke and that could upend the entire neoliberal applecart. In the course of 2010, general strikes against austerity spread from Greece to France, Spain, and Portugal. The EU-IMF “rescue” of Ireland was rejected by a huge protest march in Dublin. And, of course, the coalition’s decision nearly to treble university tuition fees has conjured into existence, since the joint march by the National Union of Students (NUS) and the University and College Union (UCU) on 10 November, a new mass movement in Britain.
This is the first time that Britain has seen significant social protests since the early 1990s, when the giant movement against the Poll Tax that toppled Thatcher was followed by big marches against pit closures and the introduction of the Criminal Justice Bill. The Blair years were marked by a significant political radicalisation that began with the movement for another globalisation in the late 1990s and then swelled to an unprecedented scale as the Stop the War Coalition was formed after 9/11. But the stubborn loyalty of the trade union bureaucracy to the Labour Party combined with enduring memories among working-class activists of the defeats they had suffered under Thatcher to prevent significant resistance developing from the labour movement to the neoliberal policies forged by Tony Blair and Gordon Brown.
This gap between political radicalisation and economic class struggle probably helps to explain the eventual decline of the anti-war movement, despite the continuing opposition to the wars in Iraq and Afghanistan evident in opinion polls. But the crisis has created a new environment that was reflected in the outburst of strikes and occupations driven by rank and file workers in the early months of 2009. On the whole, however, trade union officialdom was able to contain militancy, to disastrous effect in the biggest national disputes, at Royal Mail in the winter of 2009 and at British Airways more recently.
But the sudden irruption of an insurgent student movement has reshuffled the pack dramatically. Untrammelled by tradition, bureaucratic structures, and the daily routine of wage-labour, students can erupt into revolt very quickly, improvising new tactics as they go along. For once, the tedious media clichés about the Internet have had some validity, as calls to mobilise spread like wildfire via Facebook and the like.
Moreover, the issue that has brought students onto the streets goes to the heart of the Conservative-Liberal coalition’s drive to press further the neoliberal transformation of Britain. Under both Tories and New Labour universities have already been restructured along the lines of business enterprises subject to the logic of competition. But the review of student finance by Lord Browne, ex-chief executive of BP, that provides the basis of the government’s decision drastically to increase tuition fees, represents a step-change in this process. As Stefan Collini puts it in an excellent critique of the Browne Review:
essentially, Browne is contending that we should no longer think of higher education as the provision of a public good, articulated through educational judgment and largely financed by public funds (in recent years supplemented by a relatively small fee element). Instead, we should think of it as a lightly regulated market in which consumer demand, in the form of student choice, is sovereign in determining what is offered by service providers (i.e. universities). [21]
The students’ rebellion thus challenges the marketisation of higher education. Two features of the present insurgency are particularly striking. The first is the role by played by school and sixth-form college students. Britain does not have a tradition of large-scale school-student militancy. In France, for example, from May 1968 to the recent pensions protests, lycée (high-school) students have been an important source of militant mobilisation. In Greece, the Communist Party’s very strong base among school-students has allowed this ultra-Stalinist organisation to renew itself. In Britain by contrast, while there have been moments of militancy – for example, the school strikes at the start of the war in Iraq in March 2003 – they have usually been short-lived. But the street protests that began on Day X (24 November) have been driven by groups of school-students whose anger, impudence, and flair have left the riot police stumbling in their wake.
The second feature of the student movement is the widespread popular support it enjoys. The efforts by the coalition and the tabloids to witch-hunt the students in the wake of the occupation of the Conservative Party headquarters in Millbank Tower on 10 November were a complete flop (though this doesn’t mean the government will not seek to revenge itself with savage sentences on the protesters who have been arrested). The students have won widespread support, both formal and informal, from trade unionists.
It’s particularly interesting that leading Labour figures tried to position themselves, not in support of the more militant protests, but certainly in sympathy with the students. NUS president Aaron Porter, who initially denounced the Millbank invasion, apologised to the occupation of University College London for NUS having been “perhaps ... too cautious and too spineless about being committed to supporting student activism” – a statement confirmed by the subsequent decision by Porter and the NUS executive not to back the 9 December demonstration. [22] Labour’s new leader, Ed Miliband, has warned the increase in tuition fees “risk[s] setting back social mobility in Britain for a generation” and called the withdrawal of government funding for humanities degrees “cultural vandalism”. [23]
It’s easy enough to dismiss such comments as opportunism, as undoubtedly they are. But the point about opportunists is that they respond to the balance of forces as they see it. When Miliband told BBC Radio 4’s Today programme that he had thought of going out to talk to student protestors in Westminster on Day X, he was sending a very different signal from those Neil Kinnock sent when he sat out the 1984-5 miners’ strike in silence, or his deputy, Roy Hattersley, did when he called for “exemplary sentences” for Poll Tax rioters in 1990.
No doubt one reason why Labour has started twisting the knife about tuition fees is because the Liberal Democrats are particularly vulnerable on the issue. And indeed the widespread sense of betrayal at the Lib Dems – who paraded their opposition to tuition fees in successive general elections – is a major source of the anger among the students whose votes they had so assiduously targeted. The twists and turns among Lib Dem cabinet ministers about how they would vote in the crucial 9 December parliamentary division on tuition fees – and especially the shifting, but consistently casuistic self-justifications by Vince Cable, as Business Secretary responsible for the policy – expose the rattrap in which they now find themselves. Having appealed to the social democratic values of Labour voters disgruntled with Blair and Brown, the Liberal Democrats now find themselves partners in a neoliberal assault on those values. They are likely to pay a high price.
But there are deeper reasons why the students won such widespread support. One is their changed structural position. Although access to university still systematically favours those on higher incomes, in 2007–8, 43 percent of English 17 to 30 year olds participated in higher education, 37 percent full-time. [24] University students are not a small, relatively privileged group any more. Both because of their sheer numbers (nearly 2.4 million in 2008–9) and because many are forced to support themselves through wage-labour, often of a particularly precarious nature, they merge into the larger working class population. [25]
At the same time, students still find themselves in a transitional situation, between childhood and complete absorption in the world of work. The uncertainties of this condition can lead to fragmentation, since the individual nature of their assessment sets students against one another. But it can also allow them to move explosively into mass action, as they did in November and December 2010. [26]
The particular militancy of school students is understandable: they are being hit twice over, by the hike in tuition fees and by the abolition of the Education Maintenance Allowance (EMA) introduced under New Labour to help students from poor, working-class households stay on at college after 16. All this underlines the representative nature of the student movement. The class injustice students are rebelling against is part and parcel of the class injustice of the coalition’s assault on the poor. They are winning support because they have become a symbol of the mass resistance that wide sections of the working class recognise to be necessary.
The scale of the 10 November national demonstration came as a surprise to many. NUS officials had been expecting 20,000 to join the protest from around the country. On the day, over 50,000 students and lecturers took to the streets of London. The day after, the Independent declared that the mass protests a day earlier “ended the high hopes of a new era of consensus politics, promised by David Cameron when he took office exactly six months ago”. [27] This opinion is clearly shared by the head of the Metropolitan Police, Sir Paul Stephenson, who announced shortly after the protest that “the game has changed” and “the likelihood is for more disorder on the streets, that is obvious”. [28]
Much has been made of the spontaneity of the student revolt – from the occupation of Millbank through to the later “Day X” protests. But it is clear that the impetus for the protests came from the massive mobilisation on 10 November. There had been hints at the strength of feeling among students on the Right to Work demonstration at the Conservative Party conference on 3 October and the subsequent local protests that followed the announcement of the Comprehensive Spending Review on 20 October.
The backing of the NUS meant that student unions all around the country organised transport to London. In many areas the radical left were closely involved in building the demonstration, sometimes working closely with student unions. UCU’s support for the demonstration was another factor in the mobilisation, as was the sense of unease amongst even some vice-chancellors at the scale of the attack represented by the Brown Review – Steve Smith, the head of the vice-chancellors’ organisation Universities UK, said the £4.2 billion of cuts to higher education spending spelled out in the review “confirm our worst fears”. [29]
This convergence ensured that the demonstration on 10 November was bigger even than the 30,000 strong student protest in December 1984, which took place against the highly politicised backdrop of the Great Miners’ Strike. The demonstration was viscerally angry. Many of the protesters had been young children when the Tories were last in power. But the strength of feeling against them and them and their Liberal Democrat coalition partners was tangible. Chants of “Tory scum” and attacks on the Liberals for “turning blue” dominated large sections of the march.
This anger was played out when students deviated from the main route of the march and occupied the courtyard of Millbank Tower. Millbank was a perfect target for the students’ anger: it not only accommodates the Conservative Party offices on the seventh floor but is “owned by the Reuben Brothers, prominent Conservative Party donors whose fortune totals some £5 billion”. [30] The occupation of Millbank highlighted the importance of organisation alongside the spontaneity. It’s unlikely that most students were aware of the link between Millbank and the Tories, but the organised socialists and student radicals who gathered their university delegations behind their banners and marched them into the courtyard certainly were. But this was just the spark. One reason why the media’s attempt to witch-hunt those who entered the tower failed was clear from a glance at any photograph of the crowd outside Millbank – it swelled to several thousands of protesters in the space of an hour.
The storming of Millbank altered the dynamic of the movement. Students, many of whom had just six months ago voted for the Lib Dems, were now part of a militant protest, and this militancy created a sense that it was possible to fight back among much wider layers of students than were present on the day. Millbank would not have happened without the official NUS mobilisation but nor would it have happened if activists had been content to simply follow the lead of NUS officials.
In the wake of Millbank, the call for walkouts – independently of NUS – on 24 November spread through the social media and also received heavy coverage in the bourgeois press. In the event, Day X involved huge numbers of protestors around the country. The Guardian estimated that up to 130,000 students from schools, colleges and universities had been involved in some form of protest on the day. [31]
The presence of the school and college students on the protests brought a new sense of rage to the streets. They bitterly complained not just about the rise in tuition fees and the removal of the EMA but also about their fears for the future – how would they be able to afford education or find jobs in the future? [32]
This class anger merged with bitterness against the police. Many of these youths had experience of police harassment and stop and searches prior to the day. This was exacerbated on the day by the outrageous behaviour of the police. In London on 24 November, protesters as young as 14 found themselves kettled by police until midnight. Outside the kettle, demonstrators on Whitehall faced charges by mounted police. The Metropolitan Police’s denials that any horses charged the protesters was quickly disproved by the video evidence on the internet and publicised by the Guardian. [33]
By the second day of walkouts on 30 November, students had learned the lessons of the previous week and abandoned the agreed route of the march when it became clear the police intended to kettle them again. Instead, students ran through central London, bringing parts of the city to a standstill. This pattern was repeated on a larger scale on 9 December.
The walkouts of 24 and 30 November also saw massive protests and civil disobedience outside London. Thousands marched in Bristol, Leeds, Liverpool and Manchester. Students have been heavily involved in the “flash” protests against companies like Vodaphone and Topshop, called to draw attention to enormous levels of corporate tax avoidance.
A wave of occupations swept across Britain, from Glasgow to Plymouth. At the time of going to press, there had been over 35 occupations – even the Turner Prize gallery at the Tate was occupied by students from the Slade School of Fine Arts. Some occupations have been small, brief stunts. But others have involved hundreds of students and have seen a high level of ideological debate. Several occupations have held general assemblies that brought together students and workers to discuss the way forward for the movement. Over 300 people attended the assembly at Cambridge University on 5 December.
“The threat British students pose – much like the financial crisis bringing them on to the streets – is of contagion,” writes Gary Younge. “That their energy, enthusiasm, militancy, rage and raucousness might burn in us all”. [34] The critical question is whether and how the contagion will spread. This issue of International Socialism goes to press in the immediate aftermath of the parliamentary vote in favour of raising tuition fees on 9 December. The student revolts of the 1960s show that
student struggles are extremely volatile. Because of the fragmentation and isolation that is their existence, students can move very quickly between passivity and militancy. When they do rebel they do so with tremendous force, inventiveness and spirit, rapidly generalising and taking the struggle beyond grievances specific to their situation to a rebellion against the capitalist system. At the same time, once the particular struggle they are involved in is on the downturn, they can relapse very quickly into complete apathy. [35]
There is a risk that the present student movement could disappear as a result of demoralisation caused by the coalition pushing the rise in tuition fees into law. But this is highly unlikely. The movement against the Poll Tax only took off after it had become law. There is a French slogan: “What Parliament makes, the street can unmake.” The protest demonstration by tens of thousands of students in Whitehall on 9 December – once again organised independently of NUS – and the angry clashes with riot police outside Parliament, spreading to Oxford Street and surging around the heir to the throne’s Rolls Royce, don’t suggest students are about to give up.
The House of Commons vote itself exposed the potential fractures in the coalition. Only a minority of Lib Dem MPs, most of them ministers, voted with the government, while six Tories defied the whips to go into the “No” lobby. The Financial Times pointed to the danger it posed of further rebellions by Thatcherite backbenchers disgruntled with David Cameron’s leadership and the Lib Dem “soft left”: “This is the most rebellious parliament in recent times, according to Philip Cowley and Mark Stuart of Nottingham University, but last night’s vote was the first time the Lib Dem left has made common cause with elements of the Tory right”. [36]
What happens to the student movement depends critically on its activists are able to continue to build and coordinate mass action in the New Year. The Education Activists Network (EAN), which emerged to coordinate resistance to the cuts and redundancies that were already being pushed through during the dying days of the Brown government, is especially important because it brings students together with trade unionists in UCU and other campus unions.
Above all, will the workers’ movement follow the example set by the students and mounts serious industrial action against the coalition’s policies? The General Council of the Trade Union Congress (TUC) has called a demonstration on 26 March that could become a day of protest on a French scale. A number of public sector unions are discussing coordinated industrial action over pensions. These are potentially important steps in the direction of what the situation requires – a general strike to bring the coalition down.
The rhythm of workers’ struggles is generally slower than that of student movements. This reflects the generally higher cost of collective action – lost wages, possibly the sack – for workers. But their collective power is generally much greater because of the economic damage they can inflict on capital by disrupting or paralysing production. The differences in rhythm are reinforced by the role of the trade union bureaucracy, which exists to negotiate with capital the terms of workers’ exploitation, and thus to keep the class struggle contained within the limits of capitalism.
We have already noted how the trade union leaders helped to limit discontent with New Labour’s neoliberal policies. Their relationship to the coalition is different. Of course, they don’t have the same political links to the Tories or the Lib Dems that they still have with Labour. The unions’ institutional interests are threatened by some of the measures canvassed by the coalition or by Tory backbenchers – to limit their financial contributions to Labour, for example, and further to tighten up the anti-union laws. Most importantly, the coalition’s assault on the public sector poses an existential threat to unions such as the PCS and Unison.
So pressure for a fight is growing inside the trade union movement. A very significant straw in the wind was provided in late November by the outcome of the elections for the Unite general secretaryship. Len McCluskey, the broad left candidate, won with 101,000 votes, followed by his rank and file challenger, Jerry Hicks, with 52,000. Hicks’s success shows many trade unionists recognise that they can’t rely on the officials, however left wing their rhetoric.
The political differentiation within the trade union bureaucracy is important. It’s much better that McCluskey won than his right-wing opponent, Les Bayliss, who ran with the support of the Daily Mail. But McCluskey has been responsible for the BA dispute, where the Unite leadership has hardly covered itself in glory. Even the very hard left of the union leadership, which has broken with Labour – unions like the RMT and the Fire Brigade Union, is often stronger on rhetoric than on action, as was shown by the sudden abandonment of the London firefighters’ strike in early November. The common function of the trade union bureaucracy in negotiating class compromise is more fundamental than the political divisions within it.
This situation imposes a delicate task on revolutionary socialists, especially when they have won some influence within the trade union machine, as the Socialist Workers Party has in some public sector unions in recent years. Official calls such as that for the 26 March protest can make it easier to mobilise on a large scale. The support (with some hesitations) that UCU has given the student protests is significant. And the trade union leaders need to be held to account. The call for a general strike is, in the first instance, a demand on them to use their social power to halt the coalition in their tracks.
But the conservatism of the labour bureaucracy means it cannot be relied on deliver the action required. Historically revolutionaries have sought to build workplace-based organisations of rank and file trade unionists that can fight independently of the officials. The shop stewards organisation that broke the back of Ted Heath’s Tory government in 1970–4 represented the high point of rank and file power in this country. The erosion and bureaucratisation of this organisation under the Labour government of 1974–9 were exploited and reinforced by Margaret Thatcher in her assault on the organised working class during the 1980s. [37]
The result was a shift in the balance of power within the unions in favour of the bureaucracy. A vicious circle developed in which the officials’ ability to strangle action further weakened and demoralised the rank and file, and thereby increased the bureaucracy’s power. Principled activists, among them revolutionaries, have found themselves more and more drawn into holding union organisation together. The respect they have gained, together with discontent at the union leaders’ failure to defend their members’ interests, has tilted some public sector unions leftwards. But involvement in the union machine can become a trap, in which even the best activists become drawn into giving priority to bargaining at the top.
There is no easy way out of this situation. Ceasing to try to influence the unions, and to fight for leadership within them would be sheer foolishness. The general strikes on the continent have been called by bureaucratic union leaderships, under some pressure from below. At the same time, the fact that the most promising struggles, in France and Greece, have yet to result in victory for the workers’ movement underline the dangers of simply operating within the official machine.
The present historical moment offers a real opportunity to renew independent rank and file organisation. The development of the student movement, much more untrammelled by bureaucracy than the unions, and with a demonstrated ability to outflank its official leaders, is very important in this context. The aim must be to build the broadest and most militant struggles from below, whether among students or workers or in the community, while at the same time demanding that the trade unions and the Labour Party give these struggles their support. But the effort to win this support, let alone the demands of union electoral politics, must not be allowed to hold these struggles back.
This is likely to be a time of organisational improvisation. The EAN is an example, a network that has come to play an important role in coordinating the struggle in the universities. A plethora of different coalitions have emerged to resist the cuts, many locally, and nationally the Right to Work Campaign, the National Shop Stewards Network, and the Coalition of Resistance among others. This diversity is inevitable given that we are in the early stages of a new period of social struggles. But the potential that it represents for destructive competition and wasteful duplication makes it vital that a basic degree of coordination is established among all those mobilising against the coalition.
It is also important that this unity in action stretches into the Labour Party, which continues to hold the loyalty of core sections of the working class. Working with Labour is a source of complications. The huge cuts the coalition made in local government expenditure in the Comprehensive Spending Review were no doubt designed to put the Labour councillors who are likely to dominate the cities after the municipal elections in May directly in the firing line. Existing Labour-controlled councils are already implementing cuts in jobs and services. This is an illustration of how Labourism both expresses and contains workers’ resistance. But the best way to confront this contradiction is by working with and against Labour politicians and activists within the movement against austerity rather than by trying to restrict that movement to the would-be politically enlightened.
To repeat, the most important thing to do now is simply to build the struggle. In a widening and developing movement, the political differences that inevitably exist can be tested against practice, instead of becoming the currency of sectarian backbiting. Suddenly the horizons of revolutionary politics in Britain have widened spectacularly. We need to make sure they stay open.
1. IMF, 2010a, p. xvi.
2. For example, Chan and McGinty, 2010, and Tett, 2010.
3. IMF, 2010a, p. 17.
4. Financial Times, 23 November 2010 (for some reason this quotation was only carried in the print edition).
5. Milne, 2010.
6. Brown, 2010.
7. IMF, 2010b, p. 15.
8. Jenkins and Hughes, 2010.
9. IMF, 2010b, p. 3.
10. Irish exposure charted, 22 November 2010.
11. Tombazos, 2010.
12. Traynor, 2010.
13. Rich, 2010.
14. China boosterism is criticised from a mainstream perspective in Magnus, 2011.
15. IMF, 2010a, chapter 3 (quotation from p. 94).
16. Runciman, 2010, p. 21.
17. Laws, 2010, p. 277.
18. Parker and Timmins, 2010.
19. Friedman, 2002, p. xiv. See Klein, 2007, and, for an excellent critique, Davidson, 2009.
20. McKibbin, 2010, p. 12.
21. Collini, 2010, p. 23. For a broader analysis of the neoliberal transformation of British universities, see Callinicos, 2006.
22. Kingsley, 2010.
23. Miliband, 2010.
24. Department for Innovation, Universities and Skills, 2009.
25. http://www.hesa.ac.uk/index.php?option=com_content&task=view&id=1897&Itemid=239. [No longer available online]
26. For fuller analysis, see Callinicos and Turner, 1975, and Callinicos, 2006.
27. Independent, 11 November 2010.
28. Evening Standard, 25 November 2010.
29. BBC News, 15 October 2010.
30. Penny, 2010.
31. Walker, Lewis, Taylor, and Wintour, 2010.
32. A video filmed for the Guardian website gives an excellent insight into the anger of the school students – John Domokos and Richard Sprenger, Student protests in London: A street-level view of the day, Guardian, 24 November 2010.
33. Gabbatt and Lewis, 2010.
34. Younge, 2010.
35. Callinicos and Turner, 1975.
36. Parker and Barker, 2010.
37. See Callinicos, 1982, for a detailed analysis of the experience of rank and file movements in Britain. Paul Blackledge discusses the role of the reformist bureaucracy in his article below.
Brown, John Murray, Dublin Acts to Save Debt-Laden Economy, Financial Times (24 November).
Callinicos, Alex, 1982, The Rank and file Movement Today, International Socialism 17 (autumn).
Callinicos, Alex, 2006, Universities in a Neoliberal World (Bookmarks).
Callinicos, Alex, and Simon Turner, 1975, The Student Movement Today, International Socialism 75 (first series, February).
Chan, Sewell, and Jo Craven McGinty, Fed Documents Breadth of Emergency Measures, New York Times (1 December).
Collini, Stefan, 2010, Browne’s Gamble, London Review of Books (4 November).
Davidson, Neil, 2009, Shock and Awe, International Socialism 2:124 (Autumn).
Department for Innovation, Universities and Skills, 2009, Participation Rates in Higher Education: Academic Years 1999/2000–2007/2008 (Provisional) (31 March).
Friedman, Milton, 2002 (1962), Capitalism and Freedom (University of Chicago Press).
Gabbatt, Adam, and Paul Lewis, 2010, Student Protests: Video Shows Mounted Police Charging London Crowd, Guardian (26 November) [Video no longer available here, but it is still available here on YouTube, 25 November 2010]
IMF, 2010a, World Economic Outlook: Recovery, Risk, and Rebalancing (October). [Download]
IMF, 2010b, Global Financial Stability Report: Sovereigns, Funding, and Systemic Liquidity (October). [Download]
Jenkins, Patrick, and Jennifer Hughes, 2010, Banking: Big Gaps to Fill In, Financial Times (8 December).
Kingsley, Patrick, Student Protests: NUS President Apologises for ‘Spineless Dithering’, Guardian (28 November)
Klein, Naomi, 2007, The Shock Doctrine (Allen Lane).
Laws, David, 2010, 22 Days in May (Biteback Publishing).
Magnus, George, 2011, Uprising: Will Emerging Markets Shape or Shake the World Economy? (Wiley).
McKibbin, Ross, 2010, Nothing to Do with the Economy, London Review of Books (18 November).
Miliband, Ed, 2010, These Education Proposals Risk Setting Back Social Mobility for a Generation, Observer (5 December).
Milne, Richard, 2010, Sovereign Debt: In a Monstrous Grasp, Financial Times (3 December).
Penny, Laurie, 2010, The Power of the Broken Pane, New Statesman (14 November).
Rich, Motoko, 2010, Few New Jobs as Jobless Rate Rises to 9.8 Percent, New York Times, 3 December.
Parker, George, and Alex Barker, Clegg’s Soft Left and Tory Right Unite in Revolt, Financial Times (9 December).
Parker, George, and Nicholas Timmins, Breakneck Coalition, Financial Times (29 November).
Runciman, David, 2010, “Look ..., London Review of Books (16 December).
Tett, Gillian, 2010, Lessons in a $3,300bn Surprise from the Fed, Financial Times (2 December).
Tombazos, Stavros, 2010, Centrifugal Tendencies in the Eurozone, paper presented at Historical Materialism Conference, London (November).
Traynor, Ian, 2010, Angela Merkel Warned that Germany Could Abandon the Euro, Guardian (3 December).
Walker, Peter, Paul Lewis, Matthew Taylor, and Patrick Wintour, 2010, Student Protests: School’s Out Across the UK as Children Take to the Streets, Guardian (24 November).
Younge, Gary, 2010, Students’ Power is Limited. But Their Anger and Revolt Can Prove Contagious, Guardian (5 December).
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