by Andrew Murray
The intensity of the media and elite attack on Ed Miliband and the Labour Party, growing as the election nears, might lead the uninitiated to believe Britain was trembling on the brink of a profound social transformation.
It is true that Labour has presented a range of policies that will make things a bit better for ordinary people – controlling energy prices, building more homes and untangling the creeping privatisation of the NHS among other changes – at the price of a bit of inconvenience for the richest – mansion tax, 50 p tax rate and so on..
But the dictatorship of the proletariat it ain’t. It’s not even Labour’s programme 1973, with its commitments to public ownership and squeezing the rich until their “pips squeak”.
With Ed Balls lined up for the Treasury, the City of London can more or less sleep easy in its bed. It was Balls who was recently reported in the Financial Times as telling a business audience that “you may hear anti-City rhetoric from Ed Miliband, but never from me.” Nor, he might have added, from Shadow Business Secretary Chuka Umunna.
Balls has also made all the right noises, from an establishment point of view, about prioritising winning the City’s continuing “phony war” with the budget deficit.
Nevertheless, it is a fact that Labour is now under more intense political attack than for twenty years at least. This is of course coming from the usual suspects – the slave media at the Daily Mail and the Murdoch empire. For the latter, this may just be payback time for Miliband’s strong line against phone hacking.
The onslaught has been picked up by a miserable parade of tax dodgers, parasites on public funds and superannuated boardroom warriors who together pass as the business lobby. Their house organ, the unrepentantly neo-liberal Economist, has followed suit. For all of them, Labour under Miliband has become “anti-business” and hostile to the “wealth creators.”
As if all this were not enough, the Blairite zombies have hauled themselves out of the well-appointed coffins their long service to big business when in office earned them in order to stick their knives into Miliband’s back.
Mansion-owning Peter Mandelson has objected to the planned mansion tax. And John Hutton and Alan Milburn, both engaged in the private health sector, have attacked Labour’s NHS campaign. And Blair himself – once a Labour Prime Minister, now a director of JPMorgan and adviser to sundry despots – has dropped heavy hints that unless Labour returns to his pro-business, relaxed-about-the-rich ways, it will deserve to lose.
So why all this hullabaloo if there is really little to fear from a Labour government which would be led by a man who insists that his mission is to save capitalism from itself, rather than supersede it?
I can think of three reasons. The first is the emblematic significance of Britain in the neo-liberal order of things. Thatcher was a pioneer of the organised attack on the social democratic consensus which, with its multitude of shortcomings, prevailed politically from 1945 down to the 1970s.
Blair and Brown governed entirely within the parameters set down by Thatcher – privatisation, anti-union laws, low tax, light regulation and the rest. Most capitalist countries went down the path blazed by Thatcher and Reagan, but few as energetically as Britain.
For British capitalism’s future direction to be put back into play, however tentatively, would be an event of resounding significance. Neo-liberalism suffered economic shipwreck in 2008, but its political hegemony has for the most part maintained itself regardless, like the operatic heroes who continue singing for ten minutes while prone on the stage after being stabbed through the heart.
The mere fact of Britain starting to turn its back on the whole “there is no alternative” dogma which has anaesthetised politics, at the parliamentary level at least, since 1976 and Callaghan’s capitulation to the IMF will have wider resonance.
It will in fact restore the thing the money markets like least of all: “political risk”, the idea that democracy might impose different outcomes to those desired by the market. However discredited those markets may be as regulators of human affairs, business still way prefers them to people as the arbiter of what is allowed.
Miliband’s Labour is, of course, not very risky from that point of view, but it opens the way to the second fear. What if it were only a beginning? Could a Labour government be the opening to a stronger trade union movement – the worst fear presently entertained by Davos Man/Woman as they hypocritically grapple with the rampant inequality their system has created.
Could it create the possibility of more vigorous and challenging anti-austerity campaigning, around the Peoples Assembly, for example? Certainly, the conditions for the revival of a socialist working-class movement would be more propitious than for many years.
This connects to the third reason for the frisson of fear running through the salons of the elite. British capitalism is in a parlous state. The current account deficit, the difference between a country’s international income and outgoings, is now 4.2 per cent of GDP, according to the IMF, three times bigger than the next largest deficit in Europe.
Short-term foreign capital invested in Britain now equals 8 per cent of GDP, an astonishingly large amount. “Hot money” has flooded into Britain from places, like Russia and Greece, which seem less safe bets. It could just as easily flow out again.
And this is at a time when, under the Tories, productivity growth has dropped to the lowest level among the big capitalist countries at present. An enfeebled economy, which has not been weaned off its dependence on a hypertrophied financial sector, is not best placed to withstand any political shocks.
In a sense then, although Labour is a social democratic party of the right and Syriza a radical social democratic party of the left, the stakes in Britain are as high as they are in Greece.
The social misery here has yet to plumb the depths imposed on the Greek people – but on the other hand Britain’s role in the European and world economies is greater.
It remains home to the leading financial centre of world capitalism. In the interests of maintaining the profitability of the City the working class has been subjected to a sustained attack on living standards and other social gains of a kind not seen in living memory.
A revival of class struggle, an unwillingness to continue to submit to City dictat, and a growing political mass movement at a time of deep economic vulnerability for the rich – it is not what the elite are used to, nor what they want.
None of this makes Ed Miliband or Labour radical, still less revolutionary. But it does make one think that the hysteria with which the ruling class are treating the prospect of a Labour government is not entirely based on a misreading of their own interests.
Andrew Murray is a contributor to 21centurymanifesto