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Don’t be deterred by Osborne’s trap – strike today!
Today will see schools, prisons and courts employees, represented by trade unions, take strike action against the government on the grounds that public sector workers will work longer while contributing more towards their pension pots.
Union leaders have responded ahead of today explaining their positions. Christine Blower of the National Union of Teachers (NUT) has called the action “regrettable” but “due to the position that the government has taken, unavoidable”. TUC General Secretary Brendan Barber pointed out that pay has been frozen for two years despite high inflation, and that the feeling is public sector workers are being punished for a poor economic outlook they had no part in creating.
Strike
It is beyond despair that Ed Miliband has dismissed the strike out of hand, given that he is the leader of the Labour party. More depressing is he’ll gain nothing for it; David Cameron will continue accusing him of being in the pockets of the unions, while the laughing tabloid press continue running headlines to suit.
Ed Balls, the shadow chancellor, has hardly pledged undivided support for mass action, but what he has said is of interest. Commenting on Osborne’s strategy, he called on public sector workers not to fall into the chancellor’s trap. The trap being laid out is one, not too dissimilar from the bad snow episode – where if recovery appears slow, Osborne can raise the alarm that public sector workers are the cause.
It would seem that if Balls is saying this he knows it to be dishonest – therefore him and his party should not be giving undue credence to Osborne’s trap by withdrawing strike support.
To be sure Balls knows, and opposes, Osborne’s plans (he calls Osborne joining the Treasury another “fork in the road moment”). At a speech given at the LSE earlier this month (seen to counter the chancellor’s speech at Mansion House the day before) Balls noted that Britain’s slow recovery could cost families £3,300 by 2015, as well as leaving Britain £58bn worse off. The economies in America, France and Germany have all returned to pre-crisis levels, whereas Britain is still below that by 4%.
Commenting on recent ONS figures for growth, Balls said “These final figures confirm that in the six months since George Osborne’s spending review and VAT rise the economy has flatlined and the recovery has been choked off.”
The former children’s minister can see the risks, has been keen to point out that this is ideological (or what William Keegan calls Osborne’s “political straitjacket”) and so should respond in turn by supporting strike action, while preparing to brush aside excuses given by the chancellor for possible poor economic recovery.
What Recovery?
Esther Armstrong writing for Interactive Investor yesterday said “This was supposed to be the year economies the world over got back on track.” In fact George Osborne was hoping the whole mess would be sorted by now, but his inability to change tack through fear of looking weak has meant the British economy is shooting below target (indeed Jonathan Portes, director of the National Institute of Economic and Social Research and former chief economist at the cabinet office, was reported saying “you do not gain credibility by sticking to a strategy that isn’t working”).
The Office of Budget Responsibility (OBS) has downgraded UK growth projections for 2011 three times now, while we also face a wave of what Duncan Weldon has called “consumer recession”.
Osborne himself admitted that recovery will take longer than he expected, but this has also been compounded with the flatlining of many low and middle income earners. In fact real wages have fallen for the last 17 months and are likely to do so until 2013 – earnings falling below inflation does nothing for consumer confidence, and as Chris Dillow noted (as one of the differences between 1981 and 2010) the ability for people to run up personal debt through loans, in turn offsetting the decline in public spending, is a privilege (if you can call it that) we cannot enjoy today while banks are reluctant to lend.
If Osborne wasn’t so stubborn about saving face, he might have listened to Ed Balls’ idea for a temporary cut to VAT, which would instantly lower inflation, increase real wages, be as easy to implement as to reverse while the cost to do so is way under borrowing forecasts (the former being around £12-13bn versus the latter of £40bn). But alas the horrible show must go on.
What do we have to lose in striking?
In spite of proper Labour support, strike action is necessary. Unions are the only bargaining chip available to the workforce, and the government have been very clear they are not listening.
The damage being done by the cabinet of millionaires (whose pensions, along with other MPs, even after changes “will be among the most generous in the country“) must be challenged. As a Labour party member I’m loathe to say this; but we cannot wait for the opposition any longer – this fight will come from the bottom up, from those most affected by Tory/LibDem bullying, and it is high time this battle was won. This country will no longer be walked all over by the undeserving rich.
Cash for influence: why is anyone surprised?
"You're all going to die. Howwibly."
The case of Hoon, Hewitt, Moran and the execrable Stephen Byers in the journalistic sting operation around “cash for influence” is being used as a stick with which to beat Labour. Probably something to do with the seven Tories who steered well clear of the operation. What strikes me, however, is that surprise in any form just demonstrates ignorance.
If we look at the Tory Shadow Cabinet for a moment, Andrew Lansley, in charge of the Tory drive to increase privatised healthcare provision, accepts donations from the chairman of Care UK. Alan Duncan, one-time energy spokesman, took money from the chairman of oil traders Vitol. Osborne is in it up to his neck with hedge funds.
Grant Shapps, housing spokesman, was funded by mortgage brokers. Theresa Villiers, once shadow Chief Treasury Secretary, was backed by investment banks.
And, when they leave office, after a term of government, they’ll be rewarded with positions on the boards of various companies. More dignified than Hoon etc trying to pimp their ‘achievements’ for money, certainly, but no different in principle at all. These companies aren’t recruiting parliamentarians for philanthropic reasons.
Both parties are in this up to their necks. There’s no use the Tories using the opportunity to make a partisan point – there’s no partisan point to be made. Ex-politicians go to work for private industry. From shadow cabinet to cabinet to PM to the President of the United States himself. It just turns out that Labour hacks are a little more gullible.
I’m just shocked Hoon hasn’t pulled out the “patriotic duty” card.
On Radio 4 this morning, Hoon was queried as to his use of “inside information” to help American arms manufacturers take over European companies that would be made vulnerable by a reduction in EU defence spending.
It seems like there’s an easy answer to that: European jobs and security depend on this American “investment” and “research expertise” if European governments decrease spending, don’tchaknow!
As for Stephen Byers helping price fixing companies to “get around the law”, well there’s two options. On the one hand, he could claim that his is a revolutionary exposition of the basic monopolistic drive of capitalism.
Or he could attack “meaningless regulations” for holding back the spirit of British enterprise and causing British business to fall behind the rest of the world. There’s perfectly acceptable corporate guff public policy narratives for all situations.
Martin McGuinness and Northern Ireland under the Tories
This week’s New Statesman interview with Martin McGuinness lets the Northern Irish Deputy First Minister off extremely lightly, allowing him to appear as the romantic Republican, standing astride a bitter past with the promise of a future.
A lot of the interview concentrates on personal questions, such as whether McGuinness killed anyone as an IRA man or whether he lets death threats bother him, but the political part is remarkably weak.
McGuinness gets away with vague answers talking about how he wants to “move forward”, to “work with [Peter Robinson] in a positive, constructive way”, to “end the vicious cycle” and so on, not actually saying much.
Politics in Northern Ireland is much more mundane than a relentless focus on “the Troubles” makes it. Politicians are charged with delivering the same services as elsewhere, within the same constraints. Unbelievably, Martin McGuinness isn’t asked anything about the substantive part of what he does either as Deputy First Minister or as part of the Stormont Executive.
A passing reference to how his faith doesn’t challenge the view that everyone should be treated equally is about it.
The closest the interview comes to a challenging question was to ask whether or not a Tory government might damage McGuinness’ ’cause’. This is an important issue, because the institutions of the Good Friday Agreement, and the functions of the devolved government, operate at the sufferance of Westminster.
To this question the DFM responded:
Well, I’ve met with Owen Paterson [the Conservative shadow Northern Ireland secretary] and David Cameron, and they made it clear that they are prepared to stand faithfully by the agreements that have been made. Being involved constructively in the north of Ireland is a steep learning curve. I hope whatever government is elected will come at this as positively as Labour did in recent times.
Which is nice but rather sidesteps a key issue, which goes beyond the institutions themselves. There is nationalist speculation that the Conservatives are attempting to negotiate some deal between UCUNF (formerly the Ulster Unionists, now allied directly to the Tory Party) and the DUP, as a way to outmanoeuvre the nationalists.
This raises questions over how easily nationalists can deal with a Tory government if they have to watch their back, fearing that each initiative might be aimed at weakening the nationalists rather than furthering peace.
Interestingly, McGuinness’ view on what the Tories are prepared to do flatly contradicts the pronouncements of Owen Paterson, Tory NI spokesman. Called on by Peter Robinson to ratify any potential agreement on devolution of policing and justice, Paterson said;
“We are facing a major economic crisis should we win the next election. We cannot give any guarantees on any spending programmes.”
That’s not even the issue I myself consider important. With George Osborne giving the lie to David Cameron’s softly-softly approach on cuts in spending, in the aftermath of an election, Northern Irish politicians have got to be wondering how this is going to end up affecting them.
Even without immediate spending cuts in the block grant, the Executive needs to find ‘savings’ of some £400 million, in view of pressures like the anti-water charges campaign, which has turned the imposition of the double taxation on water usage into something akin to political suicide.
Predictions by Margaret Ritchie of crisis in the housing department, of shortfalls rising to £100m per year, directly impact upon the stability of Northern Ireland. Whether it’s re-housing people forced out by sectarian, anti-immigrant or even anti-police attacks, or providing for an area with perpetually high unemployment, housing is going to be squeezed and the results may be violent.
There’s talk of increasing the regional rates, which disproportionately affect lower and middle value properties: everything above £400,000 is capped. One hopes this will have eased, following the end of Belfast’s London-like house prices boom, but that in turn reduces the amount that can be harvested.
Capital projects will be put on hold, shelving plans for hospitals, schools and roads (and probably increasing the excess capacity in related industries), to the tune of £170 million. And then there’s the issue of a Tory government whose first priority is to stabilise a credit rating which isn’t under threat.
Perhaps McGuinness should have been asked, with his party touted (however unlikely) to occupy the First Minister spot after the next Assembly elections, how Sinn Fein intends to reconcile this with its rhetoric about how working people are being asked to pay for ‘the greed of the government, bankers and the developers’.
Resistance and economics in Greece and Sussex
Watching the unfolding events in Greece, it seems sporadic action is escalating to the point where the only remaining move of the union bureaucracy will be to call for an all-out unlimited General Strike. Teachers, taxi drivers, customs officials, doctors, municipal workers and others have one by one announced a series of strikes stretching from the rolling 24 hour strikes to three- or four-days out at a time.
The strike waves have unfurled as a response to the announcements of the Greek government that biting cuts must be imposed, in order to qualify for foreign assistance. The IMF has already announced its view that Greece should undergo the infamous ‘structural readjustments’, and the European Union has demanded spending cuts and threatened sanctions if by March the Greek government hasn’t announced such plans.
PASOK was elected on the back of a desire to stem the tide of cuts, but is pushing them through all the same. It will be up to the unions and the radical left to provide the political direction necessary to stop them. The new government has proposed taxes on fuel, alcohol, cigarettes, an extension of the working day, a roll back of the pensionable age and a raft of other measures that drop the cost of recovery on the working class.
It is my fervent hope that the Greeks can draw the line in the sand – but it will be futile if Greece is the only country to seize the opportunity.
Closer to home, slowly we’re remembering what things were like during the 1980s. Unemployed Workers Centres are gradually reopening around the country. Action Groups are springing up. Links between different groups of workers are being quickly reforged – as between students and UCU up and down the country. This process began in earnest last year over cuts and, judging by Sussex Uni, doesn’t seem to be letting up.
At Sussex, a ‘flash occupation’ of a few hundred students took over one of the university buildings for twenty nine hours, to remind uni authorities that students weren’t going away. This was well received by some of the local UCU branch. This sort of thing is encouraging. Resistance to cuts at the point of their delivery will be the key to fighting back against the attempt of the government to lumber average people with the cost of recovery.
For a while, spending can be sustained by a passably Keynesian economic orthodoxy (h/t Giles) but once private investment does pick up, and inflation becomes a real concern once more, the time will come when the government attempts to slash deficits. This will be achieved by exactly the same measures then as it might under a Tory 2010 government that continued to believe George Osborne’s rhetoric about immediate plans for deficit reduction.
Even if it isn’t, even if the government simply reverses all the measures it has undertaken (some through new taxes on items like cars, to recover money expended on car scrappage schemes, for example), we’ll still be back to the current pressures of marketization, slashing the welfare system and eventually the break up of socialized medicine in this country, the haunting words of Dave Nellist: “In one, two parliaments, one of these parties is coming for our NHS.”
Resistance, and the sinews we’re building right now, are the only things that will stop it.
First look at Tories and Co-ops
"I say, brother can you testify?"
No doubt Paul or I shall have something more in depth to say about Tories and their plans to allow ‘co-ops’ in every public sector industry, from schools to job centres. A few thoughts occur to me right off the bat, however.
Most obviously, the key problem is that these plans are being enacted just when both Labour and the Tories are ready to indulge in swingeing cuts, laying off and not replacing staff, cutting operating budgets etc.
Touted as a measure to drive efficiency, as workers can ‘become their own boss’ and wages can go up if services are delivered cheaply, overall it’s not going to change the fact that some services are about to be lost.
As with outsourcing and privatisation, therefore, there is the worry that this is just one more mask for cheaper, sub-standard services, compared to what even the bureaucratic monster state can deliver.
Another concern is that a lot of the powers given to the co-ops will be relatively superficial. George Osborne, speaking on Radio 4 this morning, said that co-op schools would be able to fire their headmaster, which he re-iterated in the Telegraph. Which is great, I suppose, but rather moot since central funding will be set elsewhere.
Key issues like classroom sizes, staffing levels and so on would be prefigured.
I’m not a fan of Labour’s Academies, but at least there the government stumps up quite a large chunk of money to refurbish the school and to pay for increased numbers of staff and so on. With the Tory idea, it’s unclear who pays for what and which powers lie where.
Thirdly, though I’ve yet to take a look at the off-the-shelf models for ‘co-ops’, I wonder just how many of them place industrial democracy at the heart of what’s actually being done, and how much of them rely on the motivation of management types towards a bigger salary – which is rarely good news for workers’ terms and conditions.
Lastly, the notion of ‘successful’ co-ops being able to bid for other areas of government business is profoundly worrying. raising the spectre of every single public service provision becoming subject to a contract between government and a legally independent entity – initially co-ops, perhaps, but ultimately the private sector too.
Current Tory plans admit of co-ops contracting outside management experts in to help run things (continuing the “consultancy” boondoggle incidentally) or going in to joint partnerships with ‘outside organisations’. It’s only a short hop from there to abolishing the ‘co-op’ middle man, and the not-for-profit status while they’re at it.
This has ramifications for the collective bargaining agreements of virtually every single public sector union. There’s no indication (and I can’t find a relevant policy paper) that the Tories would set a benchmark minimum wage based on the national arrangements agreed with the unions.
Transferring employment contracts to these new entities, and letting them control the terms and conditions of their own staff, piecemeal undermining the unions, would be an ideal stealth measure, and would probably achieve some of the cost-cutting the Tories want to see in place – and might draw flak away from the government, at least allowing them to appear defenders of decentralization and local democracy against big union bureaucracies.
Tories could also say that unions should invest in the co-op movement themselves, and compete on a level playing field with other suppliers of services ‘if they think they can do better’. For this type of thing, the unions better gear up now.
If I find evidence that this is more than a stunt by Georgie Boy, there’ll be more to come on this, as soon as I can get my grubby paws on whatever rhetoric-laden policy document bilge the Tories have prepared. In the meantime, there’s some links provided by Chris Dillow to consider: Demos on mutualism in public services; James Crabtree at Prospect on Cameronian Co-ops and some stuff from James Macintyre on why Labour’s Right get woodies over co-ops.
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