Slagging off the Thatcher Economic Miracle...

1980: The Early Days of the Thatcher Economic Miracle, as Industry Secretary Sir Keith Joseph spells it out..

Growing up in the West Midlands in the early 1980s, when the original Workshop Of The World seemed to be in permanent Closing Down Sale mode, I was always sceptical about the “Thatcher Economic Miracle” Britain was supposed to have lived through during the 1980s (and which was reaching its apotheosis twenty years ago this summer in the pages of The Sun, Express, Mail, Telegraph, Times etc). After all, if the two worst economic recessions since the 1930s, punctuated by an unsustainable credit boom, the wiping out of a good chunk of the country’s economic base and the wasting of North Sea oil revenues constitute an “Economic Miracle”, what the bloody hell was an “Economic Disaster” supposed to look like??

I could never understand how the Labour Party in the 1980s let the Tories get away with the claim that they alone were "economically competent" (ditto for patriotism- on the EU, Thatcher, as Martin Walker once pointed out, talked like Enoch Powell, but acted like Ted Heath). Now Gordon Brown goes on about building on the 'achievements' of the 1980s...no wonder the Labour Party has been deserted by so many of its traditional supporters, as yesterday's Glasgow East bye-election debacle shows.

The following piece I wrote during the winter of 1989-90, when the second recession of Thatcher’s reign was taking off serious big-time, although I notice in this essay her Government were merely “prepared to gamble with recession"...


“The successes of Thatcher’s economic policy were costly and, in retrospect, have come to seem rather short-lived.” Discuss.

Tony Thirwall, in an article about ten years of Thatcher’s economic policy, comments that “if two million unemployed, 7 per cent inflation, 13 per cent interest rats, and a £15 billion balance of payments deficit constitutes an economic miracle, what, may one ask constitutes and economic disaster?) [1] In a similar critical vein, this essay will examine those areas of economic policy in which the present government claims great success, such as controlling inflation and the trade unions, before examining its biggest failure- the failure to stop the “deindustrialisation” of the British economy. The policies of the Thatcher government will be examined as well in the context of the world economic situation over the past decade and the economic windfall for the British state in the form of North Sea oil.

One of the government’s declared objectives was to reduce public expenditure. The first words of its November 1979 Public Expenditure White Paper were “Public Expenditure is at the heart of our current economic difficulties”, [2] and it went on to declare that the government wanted public expenditure reduced by 4% by 1983-84. [3] The 1980 Mid-Term Financial Statement (MTFS) planned a 5% reduction by 1984. [4] There are several reasons for Conservative hostility to public expenditure. PM a party political level, government spending was seen as the main reason for high levels of taxation, and since the Conservatives had promised to reduce income tax, reducing public expenditure seemed the easiest way to keep their promises, High levels of public expenditure, which apparently approached 60% of national income in the mid-1970s, [6] were seen as threatening to “squeeze out” private enterprise, a traditionally important Tory concern, one expressed most articulately by Bacon and Eltis in their book “Britain’s Economic Problem: Too Few Producers”. [6] High government spending was also seen as a reason for a high Public Sector Borrowing Requirement, which many, including monetarists, saw as a cause for high levels of inflation. [7] On an ideological level, the economic “libertarians” around Thatcher saw public expenditure as an expression of state-sponsored collectivism, which was spent on collectivist-inspired welfare programmes which were in direct conflict with individual responsibility and freedom. [8]

Despite the government’s plans, and the pressure from its supporters to keep to its plans, between 1980 and 1984 public expenditure in real terms grew by 8%. Reasons for this included higher levels of social security payments as a result of higher unemployment, increased expenditure on the internal and external security of the British state, and government reluctance to reduce spending on electorally popular parts of the public sector, such as the NHS. This was in spite of reductions in funds for sectors such as housing and education. Since 1984 public spending as a percentage of national income has fallen slightly, but this is entirely due to the economy growing faster than increases in public expenditure. [10] Income tax has been reduced, the standard rate falling from 33% in 1979 to 25% in 1988, [11] but without government revenue being obtained from privatisation sales and North Sea oil revenue, these tax cuts would have been almost impossible.

Inflation was another great worry of the Conservative government in 1979, and “monetarism” was the method by which it said prices would be controlled. In practice, this meant that the government planned to control inflation through issuing monetary targets under the MTFS. It was only in 1983, though, that Sterling M3 growth targets were met. [12] Previously, actual growth in Sterling M3 had easily exceeded projected growth. [13] Contrary to the “monetarist” arguments of Milton Friedman, which the government had used as intellectual ballast for their policies, the House of Commons Committee on Monetary Policy said in March 1981 “that there was no relation between changes in money supply and the rate of inflation.” [14] In early 1985 Mrs. Thatcher publicly repudiated one of central tenets of “monetarism”- the natural rate of unemployment thesis- and this, says David Smith “was also a rejection of the monetarist ideas she had nurtured during four years as leader of the Opposition, and which she had vigorously attempted to put into practice on her election as Prime Minister…” [15] Inflation, however, was kept at a low level throughout most of the 1980s. If “monetarism” did not cause this, what did? The price of commodities, especially oil, affected inflation a lot. Around 1980 the Retail Price Index went up to around 22% [16], in the midst of the “monetarist” experiment. The main reason was the increase in the oil price following the 1979 Iranian Revolution. [17] During the 1980s the price of oil and other commodities fell as a consequence of a worldwide downturn in demand for such products, The high exchange rate, helped by the price of North Sea oil and high interest rates, kept inflationary pressures down as well. Wage militancy amongst workers was severely affected by the rise in unemployment, although wage increases throughout the 1980s on average, at about 7%, exceeded the inflation rate. [18]

Inflation started to rise in the late 1980s again as the result of several factors, government policy perhaps the most important. After abandoning monetarism, the government embraced another “New Right” economic doctrine- “supply-side” economics. [19] “Supply-siders” believed that cutting taxes can stimulate the economy. Some believed that tax cuts should have priority over controlling the money supply. In the early 1980s the government rejected this course, believing that tax should be cut only when conditions were favourable. The budges between 1986 and 1988, however, saw income tax cuts, but Britain’s economy did not have the capacity to produce all the goods desired by consumers with more ready cash. In an effort to answer demand, firms were prepared to push up wages in an attempt to recruit workers with the right skills. Where there were skill shortages, workers were able to demand higher wages. In its efforts to control inflation, the government are prepared to gamble with recession through using the same high interest and exchange rate policies as in the early 1980s- what John Hillard describes as “the application of age- old deflationary policies.” [20]

Sir Keith Joseph in 1979 wrote a pamphlet with the title “Solving the Union Problem is the Key to Britain’s Recovery.” [21] Several bills have been passed by the government aimed at controlling union activity, and the spectacular defeats the unions suffered in the 1984-5 miners’ strike and 1986-7 Wapping dispute suggested to many that the Conservatives had “tamed” the unions. As Thirwall says, though, the fall in the number of strikes was “largely a function of the high levels of unemployment”, [22] and Gamble notes that “trade union organisation remained strong. Examples of union-free industries and no-strike agreements remained rare, and earnings of unionised workers in permanent employment continued to rise faster than output and inflation.”[23] Moran even claims that the government’s trade union reforms could mean more strikes, since the law now gives more power to rank-and-file unionists, who are fragmented, unpredictable, a fertile breeding ground for all kinds of novel ideas”, as opposed to “full time officials, who…have been patriotic, cautious and well integrated into the dominant political culture.” [24] The action taken in 1989 by tube drivers and ambulance crews against the advice of their leaders suggest that Moran may be correct in believing “Conservatives may yet rue the day they undermined the trade-union officials.” [25]

Thatcher’s economic policies have failed dismally to reverse, or even stop, the fundamental problem of the British economy- the long-term decline of domestic manufacturing industry. The acceleration of Britain’s “deindustrialisation” in the 1980s is the result mostly of the government remaining staunch supporters of two long standing principles of British economic policy- that the interests of the financial sector take precedent over the interests of domestic manufacturing industry, [26], and that free trade should be encouraged as far as possible. [27]

The application of these two principles by the government, after taking office, to the British economy, led to a major recession in industry. Increases in interest rates and the rise in oil prices led to an increase in the effective exchange rate of more than 20%. [28] Unable to compete effectively with foreign goods, and unable to pay for much extra investment, manufacturing output fell by 19% [29] between 1979 and 1982. Unemployment almost doubled between 1978 and 1981 to well over two million. [30] Import penetration of domestic markets in sectors such as engineering and textiles rose by 25%. [31] In 1982 there was a record 12,000 company liquidations, [32] and for the first time in history more manufactured goods were imported than exported. [33]

At the same time s this domestic manufacturing slump was occurring, the City of London and “Those sectors able to trade and produce internationally…consolidated as the leading sectors of the economy.” [34] The government’s abolition of exchange controls in 1979 led to a major export of capital from Britain throughout the 1980s. By 1986 the volume of exported capital had almost increased threefold from its 1978 figure [35]. And “Foreign investments, both direct and portfolio, increased from £38 billion at the end of 1978 to £177 billion by the end of 1985.” [36] The forty largest UK manufactures had also between 1979 and 1986 increased employment abroad by 125,000 while reducing it in Britain by 415,000. [37] Throughout the 1980s exported capital had exceeded manufacturing investment in Britain. [38]

This export of capital helped to keep the balance of payments in surplus, as did exports of North Sea oil. Under Thatcher, North Sea oil was not used to fund the regeneration of manufacturing, as the Labour Left and Scottish Nationalists in their different ways advocated, [39] but instead took the burden of paying for “deindustrialisation.” Between 1979 and 1985, the government’s North Sea oil revenues amounted to £52 billion [40], while, says McInnes, £33 billion of that could be said to have been spent on unemployment benefit. [41] Arguably, North Sea oil also helped, along with privatisation revenue, [42] to finance income tax cuts.

Since 1982 the economy has been growing on average at 4% per annum. [43] Productivity has risen since 1980 at almost 6% per annum, [44] but this can be explained, says Leys, as “largely a statistical effect of the closure of so many inefficient plants, and of reduced manning levels” [45], and by 1988, says Victor Keegan “wage increases per unit of output- the measure used by the government.- arte actually worse in Britain than in nearly all of our major competitors….” [46] The unemployment figures have been falling since 1986, but this has been a lot to do with the 29 changes affecting unemployment statistics [47], as a Bank of England report stated recently “The sharper fall in unemployment…has been due to the introduction of the Restart interviews and stricter availability-for-work tests. Thus the Restart variable has since 1986, contributed about 750,000 to the fall in unemployment.” [48]

The economic recovery since 1982, says Gamble, depended on “the recovery in the world economy” brought about “by the supply side policies pursued in the United States which reflated the American economy and increased world demand.” [50] The recovery in Britain also depended on foreign governments, firms and financiers having faith that it could be sustained. As a result, interest rates have stayed above 10% in Britain throughout the 1980s to keep “hot money” invested in the pound and the City of London. [51] It has also meant that foreign manufacturers have been encouraged to either buy up existing British firms or set up completely new plants in Britain. This trend has been encouraged by the fact that “London has one of the most open stock markets in the world and is…the easiest place in Europe to buy companies either as a foothold for outsiders o for expansion by existing [European Economic [C]ommunity companies in the run up to 1992 [the Single European Market, which actually began on January 1st 1993].” [52] Around 10% of UK employees work for foreign firms [53], and many sectors vital to nay modern economy, such as microchips, have past under near total overseas control. [54]

In short, the government’s whole strategy for Britain’s economic future is dependent in the “internationalisation” of the British economy. This is heavily dependent on keeping foreign confidence in Britain’s economic performance, and on the health of the entire world economy. Neither of these two suppositions can be assumed to go on indefinitely. A global stock exchange crash, a trade war [55], a debt default or an economic downturn could lead to major problems for the British economy; not only could global demand decline dramatically with “knock-on” effects for the British economy, but foreign firms might pull out of Britain altogether to concentrate on home markets.

More probably, an economic slowdown in the early 1990s, to reduce the balance of payments and the rate of inflation sop that foreign confidence in the economy as a whole, and the currency in particular, could be maintained, might lead to a Conservative electoral defeat in 1991-2. [56] The problems for the Conservatives is that they are economically at the mercy of forces they cannot control, and forces, moreover, that have more influence over the British economy that when Mrs. Thatcher took office in 1979; in many cases that increased influence is a direct result of the government’s own policies. [57] Yet without the support of those international forces- whether nominally British or foreign- and the underlying world economic situation that those forces, in turn, depend upon for their influence, the Conservatives would have been unable to claim the few economic successes they point to now. Gamble, writing in the mid-1980s, may turn out to be correct in saying that “The Thatcher Government may turn out in the end to be just another administration that proclaimed economic regeneration in its rhetoric but was still forced to preside over further relative decline.” [58]



1989: The Thatcher Economic Miracle Start To Go Arse Over Tit, Despite Chancellor Nigel Lawson's best efforts...

Footnotes

[1] T. Thirwall “Myth of Thatcher’s miracle”, The Guardian, 26/4/89, p.15
[2] A. Gamble (1988) The Free Economy and the Strong State, p.101
[3] Ibid, p.101
[4] D. Kavanagh (1987) Thatcherism and British Politics, p.229
[5] A. Gamble (1985) Britain in Decline, p.229
[6] R. Bacon and W. Eltis “Too few producers” in D. Coates and J. Hillard, eds, (1985) The Economic Decline of Modern Britain, pp.77-91.
[7] J. Hillard “Thatcherism and Decline” in ibid, p.354
[8] J. Hoskyns “Mentioning the Unmentionable” in ibid, pp.127-133.
[9] Kavanagh, op cit, p.299
[10] Gamble, (1988), op cit, p.122
[11] Ibid, p.122
[12] Kavanagh, op cit, p.228
[13] Ibid, p.228
[14] Ibid, p.228
[15] D. Smith (1988) The Rise and Fall of Monetarism, p.123
[16] Ibid, p.191
[17] Ibid, pp.89-90
[18] V. Keegan “One last chance to cure the British disease”, The Guardian, 20/11/88, p.8
[19] Smith, op cit, p.176
[20] Hillard in Coates and Hillard, eds, op cit, p.355
[21] K. Joseph “Solving the Union Problem is the Key to Britain’s Recovery” in ibid, pp.98-105.
[22] Thirwall, op cit, p.15
[23] Gamble, (1988), op cit, p.127
[24] M. Moran “Industrial Relations” in H. Drucker et al, eds, (1988) Developments in British Politics 2, p.294
[25] ibid, p.294
[26] Gamble, (1988), op cit, p.194
[27] Gamble, (1985), op cit, pp.59-60
[28] Thirwall, op cit, p.15
[29] Gamble, (1985), op cit, p.194
[30] J. McInnes (1987) Thatcherism At Work, p.66
[31] Gamble 91985), op cit, p.194
[32] Ibid, p.194
[33] Ibid, p.194
[34]Gamble, (1988), p.195
[35] McInnes, op cit, p.66
[36] Gamble, (1988), op cit, p.177
[37] McInnes, op cit, p.80
[38] Ibid, p.66
[39] C. Leys (1989) Politics In Britain, pp.134 & 261
[40] McInnes op cit, p.67
[41] Ibid, p.67
[42] Asset sales had realised £12 billion up to 1985; Gamble, (1988), op cit, p.257
[43] Thirwall, op cit, p.15
[44] Leys, op cit, p.332
[45] Ibid, p.332
[46] V. Keegan “A cure which can only make things worse” ,The Guardian, 5/12/88, p.14
[47] R. Waterhouse “Anxiety grows over integrity of statistics, The Independent, 9/10/87, p.3
[48] Ibid, p.3
[49] Gamble, (1988), op cit, p.111
[50] Ibid, p.111
[51] Keegan, (1989), op cit, p.14
[52] P. Rodgers et al, “Who owns Britain as the ‘for sale’ sign goes up?” The Guardian, 2/8/88, p.11
[53] Ibid, p.11
[54] Ibid, p.11
[55] M. Walker “Iron Lady fights old dragons”, The Guardian, 16/11/88, p.23
[56] L. Elliott “Forecasts warn of long, hard slog” The Guardian, 26/6/89, p.12
[57] “Mrs. Thatcher has done more to lock Britain’s fate into Europe than any British politician since Ted Heath”; M. Walker, op cit, p.23
[58] Gamble, (1985), op cit, p.203.

As an afterword, I wish I could have cut down the footnotes. When in Freshers' Week back in October 88 I was given no advice on writing essays, but I was given a sheet of A4 that warned me about plagiarism. After that I went overboard on citing my sources. However, I think that if you want to say anything that goes against received opinion i.e. “Mrs Thatcher saved the British economy” (‘for whom’? is the question) you need to cite support of your arguments in chapter and verse ad infinitum if need be. Otherwise it is just you versus the Memory Hole...

I think my piece over-estimated the potential for the unions to regain their power (outside of the public sectors/utilities). However, I think I got spot on the potential for any "British Economic Miracle" to be brought down by external factors. Look at NuLab now getting serious grief from the rising price of imported raw materials (better not ask what happened to revenues from North Sea oil...). The "internationalisation" of the British economy has vastly increased since the late 1980s, helped by NuLab policies. If there was to be a major world economic crisis, one wonders how we would cope, particularly if foreign investors do the patriotic thing and re-invest in their own economies....

Workers' control of the means of production?

Not quite, but if more companies were owned by their employees, it would be a very good thing.


Why power-sharing beats the traditional plc
Simon Caulkin, management editor, The Observer,Sunday July 13, 2008

Asked to name employee-owned firms, most people would have difficulty getting past one finger of one hand: John Lewis. A few might have heard of ad agency St Luke's. If pushed, those of a certain age might mention the ill-starred Meriden Co-operative, set up by Tony Benn to make Triumph motorbikes for a period in the 1970s.

In fact, chides Patrick Burns, executive director of the Employee Ownership Association, co-ownership isn't the same as co-operative, which is about voting rather than ownership, and the clumsily named co-owned sector - companies where employees have a chunk of the equity above, say, 25 per cent - has an estimated turnover of around £25bn, which makes it a larger component of the UK economy than agriculture.

There is very little systematic data on employee-owned firms in Britain (there is much more in the US), but it turns out that John Lewis is far from unique. Burns reckons that there are at least 200 either fully or partly employee-owned outfits in the UK, excluding co-ops, quietly making a good living in almost every market sector in the country - from Unipart (automotive) and Wilkin & Sons (jam) in manufacturing to Loch Fyne Oysters, Divine Chocolate, Central Surrey Health and a couple of care homes, and a whole slew of design and consultancy groups, of which the best known is probably Arup.

Even at a cursory glance, the list contains more than its fair share of interestingly different and successful firms. And this, according to a new report by an all-party parliamentary group, is no coincidence. Far from being quirky exceptions that prove the normal publicly traded rule, co-owned companies, says the report, are 'exceptional mainstream companies' operating successfully in competitive markets across the public and private sector. The co-owned model, it adds, 'offers enormous potential for the UK economy'.

This is because of the performance dividend the model seems to generate. What most people experience as the 'John Lewis effect' appears to hold across the sector. 'It stands to reason,' says Burns. 'When people know it's to some extent their company, it releases huge productivity increments' - a permanent boost of 4 percentage points, according to a US survey. In fact, 'researchers now agree that the case is closed on employee ownership and corporate performance', notes the US National Centre for Share Ownership. It adds: 'Findings this consistent are very unusual.'

This doesn't make it easy. There is a catch, but a logical one. Employee share ownership on its own makes little or no performance difference. It is only when it is combined with open and participative management that it delivers the goods. This makes intuitive as well as empirical sense, and accords with separate findings about the so-called high-performance workplace. As one company put it in evidence to the parliamentary group: 'Co-ownership is perhaps half the equation of productive employee engagement. Of equal importance ... is co-control: an employee's feeling that he or she can genuinely effect change within the organisation. This is something that may be a likely, but not inevitable, consequence of co-ownership.'

It also means, as the Employee Ownership Association's Burns points out, that companies 'have to be brave twice over: sharing power as well as equity'. However, the payoffs are clear. As well as superior productivity, co-owned companies report higher levels of employee engagement, exceptional standards of corporate responsibility, and greater responsiveness to the needs of change and innovation.

Contrary to the expectations of outsiders, employee-owners are highly realistic about the implications of changing circumstances, sometimes more so than the board. In one case, aware of impending hard times, employees volunteered a pay standstill. This, of course, is one reason why the trade unions habitually distrust co-ownership; but on the other hand, in times of difficulty they show impressive 'durability under fire', preferring to adjust pay rather than jobs when business is slow and preserving employment throughout the business cycle; none of the Employee Ownership Association members is called Persimmon or Bovis or Redrow.

The UK is bad at asset transfer. Given the poor record of trade sales and the divisiveness of private equity, the parliamentary group argues that we would all be better off if more people were aware of the advantages of employee buyouts. The parliamentarians are not alone in believing that the model may be particularly suited to emerging public-sector markets, where 'the social objectives of co-owned firms, married with the more equitable distribution of resources among employees, makes co-ownership a far more palatable option for outsourced public services than traditionally run plcs'.

simon.caulkin@observer.co.uk

Lenin and Politics

The essay below I wrote in early 1990. I wish I had been much more aware of libertarian socialist/anarchist critiques of Bolshevism then, and I would be more wary now of saying Western socialism can cope with more bureaucracy. Plus it understates my own feelings about how far the powers-that-be would go to stop a democratic socialist government in the West taking power and implementing its programme. Having said that, there is a lot in it I still agree with...even more so now!

PS Sorry for all the footnotes...


“Lenin was a political genius who despised and distrusted politics.”

Lenin was undoubtedly a political genius in that he was able to seize a fleeting opportunity during the Russian Revolution of 1917 and gain power for the Bolsheviks. He organised a successful coup d’etat and let the peasantry “do the work of the proletarian revolution.” [1] He was distrustful of politics, however, in the way that many avowedly Marxist political parties throughout Europe in the early Twentieth Century were developing. He was particularly concerned about the German Social Democrats, who through theoreticians like Eduard Bernstein and politicians like Karl Kautsky, had “revised” Marxism [2], so that the SPD could declare that parliamentary politics, rather than violent insurrection, could bring about socialism. Lenin’s disillusion with many European Marxists was heightened when the SPD and other socialist parties failed to opposed the First World War [3], and when the avowedly revolutionary Mensheviks and Social Revolutionaries supported the Provisional Government in Russia during 1917 [4]. In State and Revolution Lenin wanted to show why parliamentary politics was a dead-end for Marxists, due to the nature of contemporary capitalist states and democracies.

Lenin disagrees strongly with those Marxists who believe the state is “above” class conflict: it is, he says, “a product and a manifestation of the irreconcilability of class antagonisms. The state arises where, when and insofar as class antagonisms objectively cannot be reconciled. And, conversely, the existence of the state proves that the class antagonisms are irreconcilable.” [5] In capitalist society, “A standing army and police are the chief instruments of state power”: Lenin sees the state as primarily a coercive force. [6] He adds that “Bourgeois states are the most varied in form, but their essence is the same: all these states…in the final analysis are inevitably the dictatorship of the bourgeoisie.” [7] Lenin concludes, through his interpretation of Marx and Engels, that “The supersession of the bourgeois state by the proletarian state is impossible without a violent revolution.” [8] Lenin is aware, however, of some of the writings of Marx and Engels that suggest that peaceful change is possible, and hence “revisions” have got an excuse to claim that parliamentary politics is what socialists should concentrate upon. [9]

Lenin’s main objection is based upon what he sees as major changes to capitalism since the era of Marx and Engels. Lenin believes that the state has changed due to changes in capitalism: “Imperialism- the era of bank capital…gigantic capitalist monopolies…the development of monopoly capitalism into state-monopoly capitalism- has clearly shown an extraordinary strengthening of the ‘state machine’ and an unprecedented growth in its bureaucratic and military apparatus in connection with the intensification of repressive measures against the proletariat both in the monarchical and…the freest, republican countries.” [10] To quote Bukharin, from whom Lenin got many of his ideas about Imperialism: “In former times parliament served as an arena for the struggle amongst various factions of the ruling group…Finance capital has consolidated almost all of their varieties into one ‘solid reactionary mass’ united in many centralised organisations. ‘Democratic’ and ‘liberal’ sentiments are replaced by open monarchist tendencies.” [11]

These changes means, says Lenin, that those “petit-bourgeois democrats” who believe that socialism would arrive with “the peaceful submission of the minority to the majority which has become aware of its aims” causes “in practice…the betrayal of the interests of the working class…”[12] The apparently democratic features of capitalist society, in fact, help the capitalists. Lenin cites Engels as being both “most explicit in calling for universal suffrage an instrument of bourgeois rule”, [13] and believing that “In a democratic republic…’wealth exercises its power indirectly, but all the more surely’, first, by means of the ‘direct corruption of officials…; secondly, by means of an ‘alliance of the government and the Stock Exchange’…”[14] The illusion of power that parliamentary government can control capitalism is, says Lenin, most powerful under a democratic republic and that is why it “is the best possible shell for capitalism, and, therefore, once capital has gained possession of this very best shell…it establishes power so securely, so firmly, that no change of persons, institutions or parties in the bourgeois-democratic republic can shake it.” [15] As a result “the servile social democrats…acted the role of pliant accomplices of the imperialist state.”[16]

Lenin also criticised parliamentary politics on the grounds that it did not allow meaningful democratic participation on politics, He observes that “in the ordinary course of events, the majority of the population is disbarred from participation in public and political life” [17], and “If we look more closely into the machinery of capitalist democracy…we see restriction after restriction upon democracy…in their sum total these restrictions exclude and squeeze out the poor from politics, from active participation in democracy.” [18]

If Lenin saw parliamentary politics as ineffectual in changing the nature of capitalism and alienating to the mass of people, how did he see the political system changing after a socialist revolution? Lenin saw the 1871 Paris Commune as the model of a future socialist society, and believed that the soviets that emerged in Russia during 1917 could become latter-day versions of the commune. Lenin believed that “The commune…replaced the smashed state machine ‘only’ by fuller democracy” [19]- “democracy” which saw the participation of the whole population in the running of the functions previously carried out by the state. Lenin notes that “The first decree of the Commune…was the suppression of the standing army, and its replacement by the armed people…”[20] Since Lenin saw armed force as the mainstay of all states, all authority in the commune/soviet would flow from this. Lenin saw mass participation as the answer to the threat of a bureaucracy emerging as a result of the administration needed during the “first stage” of communism. The rationalisation of capitalism during the Imperialist stage would help this process considerably: “the great majority of the functions of the old ‘state power’ have become so simplified and can be reduced to such exceedingly simple operation…that they can be easily performed by ever literate person…and…these functions can…be stripped of every shadow of privilege.” [21] In time there would be a “gradual ‘withering away’ of all bureaucracy, to the gradual creation of an order…under which the functions of control and accounting, becoming more and more simple, will be performed by each in turn…and will finally die out as the special functions of a special section of the population.” [22]

Despite opposing the parliamentary system, Lenin saw the possibility of mass participation in the running of the country: “The way out of parliamentarianism is not…the abolition of representative institutions and the elective principles, but the conversion of the representative institutions from talking shops into ‘working’ bodies.” [23] Like Marx, Lenin saw such institutions as being a “a working, not a parliamentary body, executive and legislative at the same time.” [24] The representatives are delegates of their constituents and “have to work…execute their own laws, have themselves to test the results achieved in reality, and to account directly to their constituents.” [25]

Lenin’s belief that the commune can create freedom via direct participation in democracy starts to put into doubt by his plans for the economy under socialism. He declares that “Until the ‘higher’ stage of communism arrives…socialists demand the strictest control by society and by the state over the measure of labour and the measure of consumption…” [26] Also, “All citizens become employees and workers of a single country-wide state ‘syndicate’. All that is required is that they should work equally, do their proper share of the work, and get equal pay.” [27] Lenin believes that “Marx was a centralist.” [28]

Before examining the anti-democratic and arguably “anti-political” tendencies of Lenin’s post-revolutionary vision, it is worth considering two major flaws in Lenin’s critique of capitalist political systems. Firstly, his discussions of the capitalist state depended a lot upon Marx and Engels; the problem was that their “discussions of specific and concrete social institutions was concerned almost exclusively with moments, of rupture, destruction and reconstruction in European history- the years 1789, 1848 and 1871 being the recurrent foci. Lenin was transmitted no knowledge at all of the realities of stability of the complex networks if institutions and practices which constituted the body of western society.” [29] Also “Marx wrote in a period where there was a consensus…about the impossibility of a pluralistic and consensual politics.”[30] Between that period and 1914 there was an increase throughout Europe in the scope of liberal democracy, and Polan points out that “Even…minimum liberalization and democratisation implies the possibility of evolution towards something more substantial.” [31] Radicals like Lenin “were confronted with a quite unfamiliar world of ‘competitive open’ politics, in which much of their established thought and practice became simply irrelevant.” [32]

The second major flaw was that Lenin was Russian; Czarist Russia was probably the most politically repressive and socio-economically backward country in Europe. Indeed, Russia was barely capitalist. [33] Lenin’s distrust of the social democratic belief that socialism could come through parliamentary legislation was because in Russia “there existed no possible connection between the state and freedom, there was only a profound antagonism,” [34] while in much of Europe “the connection between the state and freedom was law.” [35] Similarly, his prejudice towards the “bourgeois state machine” which “would resist, sabotage and destroy social democratic movements”, [36] stemmed from the common Russian belief “that civil servants were not just corruptible, but that public administration was synonymous with corruption…” [37] Lenin believed from Russian experience that freedom under socialism “demanded a reduction in the tasks and responsibilities of the state.” [38] Yet this could not apply to Western socialism, which saw the introduction of measures essential for building socialism in advanced complex societies, such as state economic intervention and welfare provision, needing a large bureaucracy. [39] Lenin’s belief that direct participation could end the alienation of people from “politics” floundered in Russia, since most of the population had no experience of even the most minimal kind of participation, such as voting for parliament. As a result of “the comparatively low educational…attainments of the average Russian worker” [40], and a realisation that “The peasantry…was incapable of political initiative”, [41] Lenin had to, post-revolution, support “the swift re-introduction of specialists and one-man management” [42] and ask the soviets “to separate ‘the necessary, useful preparation of the masses for executing a certain measure and checking upon its execution…from the actual execution itself’.” [43] According to those on the left of the Bolsheviks “Bureaucracy was…the inevitable result of the…move way from proletarian self-activity.” [44]

A centralised economic system, as Lenin envisaged, would perhaps inevitably led to the Soviet Union coming under the control of a bureaucracy. However, Lenin’s state structure, combined with his distrust of politics, meant that a bureaucratic dictatorship was inevitable. The bureaucracy would arise to administer state functions: “Administration concerns the carrying out of an already determined policy”, says Polan, while “politics involves the discussion and negotiation of such policies.” [45] The soviets, however, could not offer “politics”, Polan says; for “If the ‘parliamentarians’ of the soviet system have to ‘execute their own laws’…we are talking about the same people as…administrators and bureaucrats.” [46] Also “The elected deputies…have to make the laws, carry them out and criticize them”[47] in a state which allows “no distances…spaces…appeals…checks…balances…processes
…delays…interrogations, and above all, no distribution of power.” [48] The system “demands…for Lenin’s political structure to work…an absence of politics.” [49] In short, “Lenin summarily overthrows any…claim he might have had of treating bureaucratisation as a serious problem.” [50] Lenin believed in practice that the “answer ‘to…bureaucracy was to fall back on the more advanced workers, on the proletarian elite, or, rather, on the Party.’” [51] Students of bureaucracy, such as Weber, would know that “this was…to make the cure even worse than the disease.” [52]

Lenin by 1917 denied “the very existence of problematic political ideas within the bulk of the working class.” [53] He saw the politics of other socialists being purely “private self-interest made public.” [54] This allowed Lenin “to abolish any possible distance between the gross economic position of an individual and his motivations”; [55] hence “there can be no genuine differences of opinion in political life” [56], pushing “to the limit the possibilities of economic reductionism that Marxism might contain.” [57] With all people in the same economic position, working for the state, there could be no genuine disagreements over ends in the Bolshevik system, according to this logic. As a result, all political oppositions to the Bolsheviks, whether or not socialist, could be justifiably eliminated. Under Lenin’s system “Politically, the people were abolished”, [58] and bureaucratic administration ruled supreme.

To conclude, it can be said that Lenin’s distrust of politics which was inappropriate to Russia in 1917, and the elimination of socialist groups and ideas that opposed him, such as the Kronstadt sailors [59], made his genius in making Russia socialist ultimately flawed. If he had accepted that social democracy and “revisionist” forms of Marxism were appropriate for Western parliamentary democracy, socialist regimes may have come to power in the years following 1917 which would have allowed a socialist transformation of advanced industrial societies, and saved the USSR from backwardness and isolation. Instead, Lenin’s belief that his model was appropriate to all countries, combined with his intolerance and suspicion of parliamentary politics, meant him exporting his model to Europe via the newly formed communist parties of the time. This led to the left either being split [60] or advocating socialism totally inappropriate to Western countries [61]. In time this led to the Soviet Union becoming an isolated bureaucratic monstrosity, and socialism in Europe being unable to find a viable alternative to capitalism, while being tainted through association with Soviet socialism, Lenin’s distrust of “politics” could be said to have put back socialism in Europe so far that to call him a political “genius” is rather ironical.

Footnotes

[1] G. Lichtheim, (1971) Marxism, pp.332-333
[2] V.I. Lenin, (1964) “The State and Revolution” in V.I. Lenin Collected Works, Volume 25, eds. S.Aspreyan and J. Riordan, p.386
[3] J. Callaghan, (1987) The Far Left in British Politics, p.1
[4] Lenin, op cit, p.393
[5] ibid, p.387
[6] ibid, p.389
[7] ibid, p.413
[8] ibid, p.400
[9] ibid, p.415
[10] ibid, p.410
[11] N. Harding, (1981) Lenin’s Political Thought, Volume 2, p.96
[12] Lenin, op cit, p.404
[13] ibid, p.393
[14] ibid, p.392
[15] ibid, p.393
[16] Harding, op cit, p.115
[17] Lenin, op cit, p.460
[18] Ibid, p.460-461
[19] Ibid, p.419
[20] Ibid, p.418
[21] Ibid, p.421
[22] Ibid, p.426
[23] Ibid, p.423
[24] Ibid, p.423
[25] Ibid, p.424
[26] Ibid, p.470
[27] Ibid, p.473
[28] Ibid, p.429
[29} A. Polan, (1984) Lenin and the end of politics, p.154
[30] Ibid, p.174
[31] Ibid, p.175
[32] Ibid, p.174
[33] Callaghan, op cit, p.3
[34] Polan, op cit, p.161
[35] Ibid, p.161
[36] Ibid, p.58
[37] Ibid, p.163
[38] Ibid, p.67
[39] Ibid, p.67
[40] Harding, op cit, p.126
[41] Ibid, p.212
[42] Ibid, p.126
[43] Ibid, p.191
[44] Ibid, p.265
[45] Polan, op cit, p.77
[46] Ibid, p.80
[47] Ibid, p.81
[48] Ibid, p.129
[49] Ibid, p.129
[50] Ibid, p.81
[51] Ibid, p.68
[52] Ibid, p.68
[53] Ibid, p.171
[54] Ibid, p.175
[55] Ibid, p.175
[56] Ibid, p.176
[57] Ibid, p.176
[58] Ibid, p.78
[59] Harding, op cit, p.272
[60] Callaghan, op cit, pp.3-4
[61] Ibid, p.4

Blimey, he's still going!

Forcing myself to sit down and post stuff for my blog has been a bit difficult for me in recent weeks. I've been out and about a fair bit when not working, so getting "quality time" to sit in front of a PC screen and tap tap tap away hard (as opposed to, say, messing around on Facebook)has been a bit difficult.

Anyway, I hope to be a bit more regular in coming weeks. One thing I will be doing is going through old essays of mine from my undergrad days and post them up. We are talking the period 1988-91. Apart from one or two stylistic changes I will leave them as they were originally written (one thing I've noticed reading them is how badly my writing has degenerated in the last couple of decades!). I got a 2.1, so they are not so bad! Furthermore, there are a lot of footnotes in them, so you can follow up stuff if something I say interests you. During Intro Week in my first year every fresher was given a guide to plagiarism and how to avoid it (the only official guidance we were given at the time to writing essays). Basically everything we wrote had to be backed by evidence. Consequently my essays were full of footnotes- more than were really needed. However, I think another reason for this was that holding non-conventional views on a fair few political topics (you may have noticed!)I needed back-up. Being able to quote sources to back you and your arguments up if you do not have conventional views is essential if you are to be taken seriously by others.

Apols for the hiatus...

I've got a life outside of blogging, so I have been neglecting my duties, some of which I will get around to posting about in the not too distant future. As for the Oscar Wilde of British Fascism ie "Sid", life is too short to waste much time on a nasty piece of work like him.

To fill the gap a bit, I got this meme from Madam Miaow. It's doing the rounds through the blogosphere at the moment:

“List seven songs you are into right now. No matter what the genre, whether they have words, or even if they’re not any good, but they must be songs you’re really enjoying now, shaping your spring. Post these instructions in your blog along with your 7 songs. Then tag 7 other people to see what they’re listening to.”

I had to think hard about this. I am so out of following current musical trends. I keep telling myself to listen to XFM, but the few times I've tried to listen to it in the last couple of years I seem to tune into some DJ "telling me and more about some useless information" (to quote Sir Michael Jagger). At least with my own musical collection I can listen to what I want when I want. Most of what I learn about "new music" is via going on YouTube.

So the 7 I've chosen are very much pieces of music which have been going through my mind over the last few months:

(1) Tori Amos: Professional Widow (Amand Van Helden mix) I'm far from a connoisseur of "dance music". The best of it is glorified disco. The worst is like prog rock with a beat, with nothing to sing along to and just far too long. However, I like this, mainly because it doesn't go on too long and is based on a real song: "Professional Widow" by Tori Amos, which is supposedly about post-Kurt Cobain Courtney Love.

(2) Jarvis Cocker: Running The World. This makes "Common People" sound like a vicarage tea party. Link has scenes from my favourite film of 2006 "Children of Men".

(3) Black Kids: I Ain't Gonna Teach Your Boyfriend To Dance With You. Saw these on Jools Holland a couple of months ago. I totally agree with the sentiments: too many objects of desire go out with complete numpties- don't encourage them!

(4) Rage Against The Machine: Testify. From 2000, a good antidote to the current bout of Barak-mania (and Gore-mania too).

(5) : Supergrass: Sun Hits The Sky. A great summer song (even better if the weather goes with it) from their best album of the lot, In It For The Money.

(6) Eye of the Tiger. Not the version in the Rocky film, but from Persepolis. Marjane comes home to Iran from Vienna in the late 1980s, finds it extremely hard to adapt, then almost kills herself with a drink/drugs cocktail. Then she snaps out of it, and this is the soundtrack to picking herself up from the floor.

(7) Moby: Everyday It's 1989. From his new album (but I found it on a freebie Sunday Times CD) some glorified disco.

That's my 7. If anyone else wants me to tag them, be my guest!

Why does ZZ Top's "Sharp Dressed Man" Come To Mind?

Richard Barnbrook: The BNP's man in the GLA. Who says you can't look good in brown?

This is republished and slightly changed from Friday...got some bile from a BNPer as a consequence [see below]...


It is worth noting that the BNP got virtually the same share of the vote in this year's GLA Elections- 5.4%- as the NF did in the 1977 GLC elections (the NF got 5.3%. They took 119,000 votes, compared to the BNP getting just under 131,000 this time). The only real difference from 31 years ago is that there is an element of PR in this year's elections*. Under PR it is generally easier for fringe political groups to gain seats (although try telling the SWP that after their latest "cunning plan" ie Left Luggage went arse over tit last week. No wonder Lindsay G didn't turn up to the Mayoral election count...).If the benchmark of racist sentiment in London is the city-wide performance of "the Far Right", not much has changed over 30 years. There are still Racially Obsessed types out there, but overall they haven't really increased in number over three decades.

* I can see anti-PR people arguing that Sharp Dressed Man's election to the GLA proves that PR encourages "the Far Right". However, those who defend First-Past-The-Post will have to explain why when Italy had PR, overt Mussolini worshippers got nowhere near national political power, while now under FPTP they are Government Ministers. Plus I'm sure if Richard B was Italian, Berlusconi would give him a job, simply due to his natty threads...

2 comments:

Sid said...

It's ironic that an ugly, smug, bastard like you would mock Barnbrook's appearance. And you actually look quite a bit older than your age (pssst - the boys down on the common are just flattering you to get your money).

By the way, the BNP's vote was actually better than the NF's thirty years ago because of the huge demographic changes since then which make 5.3% much harder to get. Understand, you thick cunt?



2020: As Nick Griffin becomes PM, Sid and friends crack down on erstwhile anti-BNP bloggers...

Anglonoel said...

Hey Sidney! (or should I call you Mr. Vicious...or Mr. Little?)

Cheers for your first ever contribution to my blog. You really know how to win friends and influence people on behalf of the BNP (I take it you are a loyal BNP member/supporter- or do you think Nick Griffin has sold "British Nationalism" out to the Zionist Occupational Government?).

Unfortunately, that'll be your last to be published here as I've changed the settings. All comments from now on need my approval before they appear.

Before you start effing and blinding (which you seem incapable of NOT doing- or did the Stella/Special Brew make you do it?) on the grounds that I'm gagging your freedom of speech, I would point out:

(i)where's your blog with comment box, so people (ie 95% of the population) who disagree with you can take issue with, and take the piss out, your "thoughts"?; &

ii) by the way you attacked me, you foul mouthed nasty piece of work, I should guess that if you want a picture of future BNP Government, just imagine a boot stamping on a human face for ever. If the BNP took over I don't think anti-Government free speech would last very long. In particular, if your attitude is anything to go by, taking the piss out of BNP would be a thing of the past, and there would be no laughter, except the laugh of triumph over a defeated enemy.

So, sorry Sid, I'm pulling the plug on you. However, you'll be glad to know that your erudite contribution will be the focus of my next post. If you think I took the piss out of Richard Barnbrook (got a suit like his have you?), you ain't seen nothing yet.

So long, you sad race obsessed loser.

PS I might be ugly in looks, but at least my politics ain't. BTW where's your mugshot? I take it that YOU haven't put male Supermodel Fabio out a job yet...

Elections v. v.quick update- First Highgate, then the world...

Well, Boris won the Mayoral Election. The best thing you can say for him is that he is opposed to ID cards.

Furthermore, the BNP got a seat in the GLA.

On the plus side, the Greens took the 3rd seat in Highgate ward. Lab came second and the Cons third. The Greens took two seats on the GLA (same as in 04)and Sian Berry (who I found out on Wed night drinks bitter, after an evening getting soaked leafletting letter boxes in Archway) came fourth in the first round of the Mayoral contest. Furthermore, the Greens did pretty well in most of the constituency contests.

Respect (apart from 15% in City and East) and Left Luggage, sorry Left List, did extremely badly. It seems the last hope of the English Left is the Green Party. However, how more disasters it will take for the message to get home to all those wanting to re-stage Sergei Eisenstein's October?

Will blog more Sunday night/Monday morning here. I saw Naomi Klein's Shock Doctrine going dirt cheap in a bookshop yesterday so I'm going to splash out and read it in the park this afternoon, either trying to get a suntan or rust...

Update: Early Hours of Monday 5th: Just finished Shock Doctrine. It is even better than No Logo. The book it complements is Greg Palast's Armed Madhouse (I need to look hard in the footnotes to see if NK cites him). I want to review it at length, or at least use it as a starting point for other posts. For instance, surely there is a viable political way between grovelling to Corporate Capitalism on one side and pandering to RORO (Racially Or Religiously Obsessed) types on the other? I'm tired and I digress...

There has been talk over the weekend that there may be a challenge to Gordon Brown's leadership of the Labour Party at some point in the coming months if things don't impove. There seems to be hopes on the Labour Left that NuLab can be defeated at last, but I'm pretty sure NuLab will find someone else to lead them all on the Forward Path to Reform and Modernisation if GB fails. The Tories seem to think the next General Election is all over bar the shooting, sorry shouting, but I still think we will have a hung Parliament in 2009-10 and a National Government of "Reformers" and "Modernisers" will form in the aftermath. We will see...