The resignation of Liz Truss after 44 days as Prime Minister is just the latest in an unprecedented and chaotic sequence of events in British politics since the Brexit referendum of 2016, and there is no sign that things are going to miraculously settle down into some sort of constitutional normality. At the time of writing, a new leadership contest is underway: Rishi Sunik may be favourite to win, but the return of Boris Johnson is also a possibility – a clear expression of a party which is running out of options and could be on the verge of a historic split. But the “Tory crisis” is really an expression of a much deeper political crisis within the ruling class as a whole, of a decomposing system in which the bourgeoisie everywhere is increasingly losing control over its own political life.
44 days of political mayhem
Truss became Prime Minister on 6 September and proceeded to remove from ministerial roles anyone who had opposed her in the leadership election against Rishi Sunak. On 23 September Kwasi Kwarteng announced a series of tax reducing measures that had not been costed or run by the Office for Budget Responsibility. This had an instant dramatic impact on the value of the pound, on interest rates, pension funds, government bonds, and the availability of mortgages. At the Tory Party Conference in early October Truss labelled all opponents of her economic policies as being part of an “Anti-growth Coalition”. As if there was any faction of the ruling class that has no interest in the accumulation of capital and in the strengthening of the national economy – it’s just that there are differences in the bourgeoisie on the means to achieve this.
On 14 October Kwarteng was ordered back from an IMF meeting in the US to be sacked (for doing what had been agreed with Truss) and replaced by Jeremy Hunt as Chancellor of the Exchequer. On 17 October Hunt announced the scrapping of nearly all the measures announced in the mini-budget devised by Truss. A plan for £45bn of unfunded tax cuts underwent a £32bn reversal, and, in the name of stability and balancing the books, there will be “eye-watering” spending cuts to come; the planned two-year energy price cap will only last until next April, and they’ve so far found only about half of the £70bn fiscal black hole.
Yes, the Truss government proved itself particularly incompetent in not understanding what would be the effect of their policies, but the political and economic crisis convulsing British capitalism has a global context and historic roots that go beyond the ineptitude of a particular administration.
Social decomposition and the loss of political control
Historically the British bourgeoisie used to be able to make appropriate adjustments in its political apparatus to cope with all situations – whether changes in the economy, at the imperialist level, or in relation to the class struggle. The last three decades of social decomposition have shown how the bourgeoisie has increasingly lost control of its political apparatus, not least due to the growing influence of populism in one of its main parties. The first signs of this became obvious in 2016, with Cameron’s blunder in holding a referendum on membership of the EU, in a failed attempt to counter the influence of UKIP-style populism on the Tory Party. Since the Brexit decision we have seen May and the negotiations over leaving the EU, then Johnson and “getting Brexit done” which meant accepting an agreement that it was soon clear they had every intention of challenging. Johnson’s leaving was messy as he departed implying that he had been the victim of a stab in the back; there are still many Tories who are now openly in favour of returning Boris to power. The advent of Truss, who emerged from a limited pool of candidates, all of whom were tainted by their involvement in the Johnson government, might have been a turn away from big-spending “levelling up” populism, but it involved the adoption of free market fantasies à la Thatcher that further damaged the image of the Tory party as a safe manager of the British economy. The one element where there was continuity between Johnson and Truss was the ability to make U-turns without any shame.
A long-standing economic crisis
Truss and, before her, Johnson, blamed Russia’s invasion of Ukraine in February for the rise in inflation, and specifically the increase in energy costs. Yet energy firms were already going bust in late 2021, and inflation in the UK (currently growing faster than any of the G7) was already taking off during 2021, and had reached 5.4% by the end of December 2021, before subsequently going into double figures (with much food inflation significantly higher). This was the highest rate since 1982, with predictions of more to come. With energy costs specifically, electricity prices rose by 54% and gas prices by 95.7% in the year to September. But the economic crisis of British capitalism is not just the product of the war or the pandemic or because of Brexit. In reality, Britain’s economic supremacy in the world was already being challenged by rising powers like the US and Germany in the latter part of the 19th century, and the century since World War I has been a story of Britain’s continuing descent to the status of a third-rate power. This long descent has accelerated in the final phase of capitalism’s decadence: the rise of populism and the Brexit fiasco are a classic product of this phase, and while they are certainly an exacerbating factor in the UK’s economic and political turmoil, they are not the underlying cause, which can only be sought in the irresolvable contradictions of capitalism as a world system.
This is important to understand because it serves as a warning to the working class that a change of ruling team will not do away with the growing threat of pauperisation. The choices made by different ruling teams do not include any benign alternatives. As the resolution on the international situation from the ICC’s 24th Congress puts it: “policy changes cannot rescue the world economy from oscillating between the twin dangers of inflation and deflation, new credit crunches and currency crises, all leading to brutal recessions.” Where Truss initially wanted to take on “Treasury orthodoxy” which led to panics in the market, massive increases in debt, pressure on inflation, and attacks on the conditions of life of the working class, Hunt’s embrace of Treasury orthodoxy, in the latest of many government U-turns, means the reassertion of an austerity regime, without the pretence of wealth “trickling down”. It will involve reductions in public spending and tax increases. In short, further attacks on living standards.
As things stand, the policy of the Treasury means cutting government expenditure, while the Bank of England, having tried to deal with government recklessness, will still be trying to limit inflation, which commentators are pointing to as the route to a deeper and more prolonged recession.
Cracks in the “United” Kingdom
Another area of continuity was in making the SNP and Scottish independence look as though they were viable possibilities. In contrast to the Johnson and Truss governments, the SNP in Scotland has performed within the normal boundaries of bourgeois respectability, always able to blame London for economic problems or carelessness over the pandemic. The break-up of the United Kingdom used to seem an impossible aspiration of eccentric nationalists, but the SNP is now able to present independence (and rejoining the EU) as an inviting alternative to rule by English populists and extremists. At the same time the question of the status of Northern Ireland is unresolved with the final Brexit deal leaving the British bourgeoisie trapped between the Northern Ireland Protocol and the Good Friday Agreement. The DUP has dug in its heels over the Northern Ireland Protocol, but the British government’s current position is that it would have no option but to call an election if the DUP does not return to power-sharing by 28 October. As the DUP was overtaken by Sinn Fein as the largest party at the last elections in May, it might be reluctant to repeat the experience. Meanwhile there is pressure on Britain from both the EU and the US not to do anything to disturb the present fragile situation around Northern Ireland.
With the war in Ukraine British imperialism remains Zelensky’s biggest supporter in Europe in terms of both arms and rhetoric supplied. This makes demands on British finances, and Truss’s previous commitment to significantly increase the defence budget is not necessarily going to be upheld, although it should always be remembered that militarism is at the core of the survival of the national capital, and war is no longer a rational factor in terms of economic or even strategic gains.
The British bourgeoisie faces a combative working class
On another front, the British bourgeoisie has to deal with the struggles of the working class.
The struggles of the summer did not die out with the coming of autumn and, while, at the moment, the control of the unions is limiting the extent of the struggles, what is already a break with years of passivity could still go further. In response to this there has been government talk of strengthening legislation against strikes and protests. All bourgeois factions will use repression in one form or another, but the attempt to push through provocative political and economic measures at a time when the class struggle is developing is another expression of the particular incompetence of the Truss government. On the other hand, despite this growing loss of control of the political apparatus by the bourgeoisie, we should not underestimate the capacity of the different factions to respond to developments in the class struggle, in particular through a division of labour between a “hardnosed” government and increasingly radical-sounding trade unions. At the same time, the opposition parties, led by Labour, are redoubling their calls for a general election, which is another tried and tested means to sabotage the class struggle
However, the objective conditions for the sharpening of class conflict are maturing every day. Capitalism cannot avoid attacking the living and working conditions of the exploited class, whether in the form of inflation and the cost-of-living crisis, or cuts in government spending - which in practice means attacks on benefits, pensions, and services from any government funded body, from the health service to education to housing to public transport. The bourgeoisie can only offer austerity, and there is no alternative beyond this that can be honestly offered by parties in opposition, whatever Labour or the SNP might promise.
In defending itself from mounting assaults on its living standards, the working class cannot gain anything from the widening divisions among its class enemy: at this stage in the class conflict, they are more likely to be used to strengthen divisions within the working class itself (the clash between the supporters and opponents of Brexit, or the so-called “Culture Wars”, have precisely this impact on the workers’ awareness of themselves as a class with common interests). The development of the class struggle depends on workers beginning to see that there’s nothing to salvage from capitalism and that their resistance needs to develop the perspective of the overthrow of this rotting system