Divisions, scandals in the ruling class… But they can still unite against the workers

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In the last week of June British banks again made headlines for their greed, dishonesty and incompetence. “Royal Bank of Scotland couldn’t serve its customers because its computers failed; Barclays was fined £290m for trying to manipulate the money markets; other banks will soon be confessing to the same sin and paying their own hefty fines. And now RBS, Barclays, Lloyds and HSBC – the UK’s big four – are compensating small businesses who were hoodwinked into buying complex insurance that they did not need.”[1] Politicians talked about the banking culture and how some aspects of it were ‘shocking’. What commentators, academics and other ‘experts’ never mention at such moments (and is the basis of any serious explanation of what is going on in the world) is that we all live in a class society; a society in which the ruling class exploits and controls the working class. The two classes, bourgeoisie and proletariat, stand opposed, each with its own interests and way of struggling.

The fundamental interest that unites the bourgeoisie is maintaining its domination and the capitalist system of exploitation that it is based on. However, there have historically always been divisions within the bourgeoisie, largely based on conflicting economic interests. There have also been differences over relations with other countries, what marxists analyse as imperialist rivalries. The last twenty or so years have seen the bourgeoisie around the world facing a range of increasing pressures. These come from the economic stresses that continue to break out into open crisis, from the proliferation of conflicts that followed the break-up of the Russian and American imperialist blocs, and from the challenge of maintaining social order. In short, the contradictions that have always run through capitalism have become more acute.

The working class cannot take advantage of the divisions in the ranks of ruling class. In part this is because the bourgeoisie maintains its greatest level of unity against the working class – history has shown that it can put aside the most intense rivalry to save its collective skin – and in part because the working class is not yet acting as a united, class-conscious force.

Why is it important to examine the life of the ruling class? The answer is for the same reasons that the bourgeoisie keeps a close eye on the working class: to be able to wage the class struggle as effectively as possible. Analysing how the ruling class acts and the relations and tensions within it can help us to understand the evolution of the economic situation, the conflicts between nations and the strategies used to maintain social order.

The growing difficulty in managing the economy

Underlying all of the difficulties facing the ruling class lies the question of the economy. Today the difficulties are plain to see, but they are only the culmination of structural problems going back decades. Since the end of the Second World War two approaches have succeeded each other. From the end of the war until the late 1970s Keynesianism dominated economic thinking with state intervention used to manage the business cycle by stimulating demand in the troughs through the use of deficit spending. This approach ended in Britain during the 1970s amid economic stagnation, rising inflation and increasing unemployment.

It was replaced by an approach generally referred to now as neo-liberalism, although at the time it was more usually described in Britain as Thatcherism. This approach is popularly associated with the privatisation of state owned industries, sales of council houses, legislation to control the unions and so on. It was supposed to allow the economic laws of capitalism to operate more freely and the short-lived economic ‘booms’ of the late 1980s and 1990s seemed to show it was effective. In reality, these ‘booms’ were based on the increased exploitation of the working class, and an increase in state and private debt.

The failure of neo-liberalism, like Keynesianism before it, was brutally exposed by the economic crisis that exploded in 2008. The initial response of the bourgeoisie was to throw money at the problem to contain the crisis that seemed to be ripping the financial sector apart. It could not stop the crisis from spreading. The bourgeoisie’s response contains elements that can be seen as Keynesian, such as the various ways money has been created and injected into the economy, and others more associated with neo-liberalism, notably in the measures required by the IMF in return for bailouts. In short, the bourgeoisie does not know which way to turn. The only policy that it is agreed on is attacking the working class.

The ruling class in Britain has followed the international trend, with a little bit of Keynes, some neo-liberalism and a lot of attacks on the working class. The LibCon Coalition proclaimed that the economy would be rebalanced away from dependence on the financial sector and that manufacturing would lead the way out of the crisis. This approach failed. Manufacturing went back into recession over a year ago and the balance of Britain’s trade in goods across the world being almost totally negative. What remains are austerity measures to reduce state debt. The only rebalancing of the economy going on is the forcing down of the living standards of the working class in order to protect profits.

Labour has no disagreement with this last point, other than claiming to want to do it more slowly. Milliband and Balls have begun to associate themselves with the call for policies to promote ‘growth’ following the election of Hollande in France, but have no real disagreements. Their ‘opposition’ is principally designed to fool those who distrust the Tories.

However, a significant development over the last few years has been the growth of the view that sees withdrawal from Europe as being in Britain’s interests. A few years back this faction seemed largely restricted to the likes of UKIP, but the attempt to force through a referendum on Europe last year revealed that it exists within part of the Tory party. The assertion of control by Cameron, while effective, seems to have left a legacy of bitterness within parts of the right, which snipe at the concessions made to the LibDems and call for real Tory policies. This could be seen in the alternative Queen’s Speech published on the Conservative Home website, which had the backing of 20 MPs including David Davis and John Redwood. There was also the attack by Nadine Dorries on Cameron and Osbourne as two arrogant posh boys who don’t know the price of milk, and who subsequently said that she is close to UKIP.

While this points to some incoherence within the bourgeoisie, since leaving Europe is likely to weaken Britain’s economy, as well as leaving it more isolated on the imperialist stage, it is unclear how widespread these views are in the Tory party. Following the 2010 election the right became more dominant in the party, and many Tory MPs are openly Eurosceptic, but this does not imply they all want to leave Europe or that they agreed with last year’s call for a referendum. This suggests that those openly attacking the government are currently a small minority: no one associated themselves with Dorries’ attack.

The recent budget showed the level of challenges facing the ruling class in imposing austerity but, as have argued[2] the handling was relatively skilful since the headlines generated by the cut in the 50% top tax rate, the granny tax and pasty tax allowed the more serious attacks, such as the move towards localised pay, to go through without remark.

Divisions over imperialist policy

In previous articles in World Revolution we have shown the significant role that divisions over imperialist strategy have played in the life of the bourgeoisie over the last 20 years.[3] One of the reasons New Labour came to power was that it was more united than the Tories in defending the aim of developing a strategy that was subservient neither to the US nor Germany. That this is a continuing debate within the bourgeoisie is evident from the shift of the Blair government after 9/11 and of the Tories under Cameron. Cameron has seemed contradictory, sometimes appearing very Eurosceptic, sometimes committed to the line of a more ‘independent Britain’. ‘Debates’ within the bourgeoisie are pursued as much through intrigue and deception as discussion.

We situated the campaign launched against the Murdoch empire last year within this framework, arguing: “Murdoch’s support of US imperialism and strong Eurosceptic views… helped reinforce powerful, pre-existing conflicts within the British ruling class and was increasingly at odds with post-Blair UK imperialist policy…which was to try to play a more independent role following the fiascos of the Afghan/Iraq wars which left the UK weakened.[4] The struggles to cut him down united disparate parts of the British state and media and the current Leveson Inquiry originated as part of this effort. However, Leveson’s remit to look at relations between the press and the police and politicians suggests it is also part of wider efforts to enforce discipline within the bourgeoisie and, by doing so relatively openly, to continue the campaign about restoring the reputation of democracy that seemed to be the primary purpose of the scandal over MPs expenses.

The Labour Party and the LibDems were fairly quick to jump on the anti-Murdoch bandwagon but the Tories have been more divided. Cameron’s main argument is that politicians across the spectrum allowed themselves to get too close to the media in general and by doing so to water-down the specific criticism of Murdoch and the responsibility of his own party, including himself. The same concerns seem to have been behind the decision by the Tories on the Culture, Media and Sports Committee not to support the recent report that accused News International of wilful blindness and declared that Rupert Murdoch was not a fit person to run a major international company. Few have been as outspoken as the Education Secretary Michael Gove (who worked for years on the Murdoch-owned Times) who described Rupert Murdoch as “one of the most impressive and significant figures of the last 50 years”. In contrast, ex-Prime Minister John Major had no qualms in sticking the knife in when he stated that Murdoch had tried to get him to change Tory party policy over Europe at the time of 1997 election or risk losing the support of the Murdoch press. Major’s government was almost torn apart by the actions of the Eurosceptics, so it is no surprise that he seemed to relish getting his own back.

An interesting current development is the Leveson Inquiry’s role in seeming to put pressure on Cameron, notably through the recent revelations about the contact between Jeremy Hunt and NI, and between Cameron and senior figures such as Rebecca Brookes. The revelations about Hunt were the result of a direct demand by the Inquiry for the emails relating to him. However, NI itself has been a source of some of the information with material being passed to the police by its internal investigation, which raises the possibility that Murdoch is also exacting some revenge for being humiliated.

This may not seem a very direct way to have an argument about imperialist policy, but the need to maintain the façade that Britain is a steadfast defender of peace and co-operation around the world requires it to hide the reality. The fact is that the struggle over imperialist policy has gone on for some two decades and is unresolved. The fact that Cameron gives different messages in his speeches expresses traditional British pragmatism at one level, while, at another, it expresses the historical dilemma of British imperialism arising from the fact that it is a declining power.

Electoral and democratic strategy

One of the first priorities of the ruling class in most ‘developed’ countries is to maintain the democratic game, to draw workers into the drama of the false alternatives. All the campaigns to clean up politics are part of this. While these risk further discrediting politicians and politics, and so feeding already existing apathy and disgust, in the current stage of the class struggle in Britain such disgust is unlikely to be widely transformed into militant struggle. For the minority that begin to question mainstream politics, the far left and right effectively absorb and contain much of this anger, although the likes of UKIP also express the growth of irrationality within the bourgeoisie. The overall impact of the ‘clean-up politics’ campaigns is to keep the majority of the working class within the framework of politics as defined by the bourgeoisie.

The current electoral line-up still suits the needs of the bourgeoisie. The Coalition suffered some battering in the recent local elections because of its attacks on the working class. The LibDems are seen as unprincipled and the Tories as unreformed. The Coalition still promotes the idea that dealing with the economic crisis is more important than party squabbles. In their speeches after the local elections Cameron and Clegg played to this, acknowledging that they would both like to lead a government in which their party had a majority but that they had to deal with the reality of the situation and work in the national interest.

In opposition all that Milliband offers is a slight variation on what is in the ‘national interest’. However, after only two years out of office the Labour Party is beginning to be presented as a viable party of government. This reflects two factors, firstly that there is no particular need for Labour to be in opposition to contain a rising tide of working class anger and militancy. Red Ed has turned out to be rather pale and the most Labour feels it necessary to do is to call for a slightly more restrained austerity with a little dash of ‘growth’. Secondly, that the volatility of the situation makes it prudent for the bourgeoisie to keep its options open.

Containing the working class

The bourgeoisie’s overall strategy to control the working class is based on the principle of divide and rule. It seeks to prevent working class unity and to prevent the proletariat from seeing itself as a class. Over the last few decades the bourgeoisie has introduced its attacks piecemeal, scapegoating the unemployed, the young, single mothers, asylum seekers etc. It has been able to contain and defeat the immediate response of the working class but has found it far more difficult to contain the spread of disaffection and disengagement although, other than in a small minority, this is not accompanied by a questioning of society.

Today, the main challenge for the ruling class is to introduce the scale of attacks required by the severity of the crisis without provoking a response from the working class that escapes control.

Overall, the bourgeoisie has so far succeeded in this. There is a low level of struggle and the unions have maintained a firm grip, corralling anger into a few one day strikes that have not only divided public sector workers from private sector workers but also divided the public sector itself. The tendency that exists to challenge the unions, while an expression of global developments, remains limited and unreported.

Not every manoeuvre works out as planned however. The attempt to reprise Thatcher’s confrontation with the unions over the threatened tanker drivers strike and to turn it into Cameron’s “miners’ strike moment”, as some in the Tory party described it, while successful in whipping up some public panic and creating artificial shortages, ended in the farce of calls for the population to store petrol in the home and tragedy when someone followed this advice.

This does not mean that the bourgeoisie has everything sewn up. The objective conditions for the development of the class struggle continue to develop internationally because the bourgeoisie is unable to contain the crisis and has to increase the scale and extent of the attacks on the working class. The subjective conditions, of a willingness to struggle, recognition of the necessity of class unity and consciousness of what workers are struggling against and struggling for can be seen here and there. While limited at present by a range of factors, including the actions of the ruling class, the development internationally over the last few years confirm that the bourgeoisie cannot rest easy in their beds.  

North 23/06/12