Whoever wins the election there are massive cuts ahead

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The ruling class is gearing up for its election. This time the big issue is not who will win, not even how many people will bother to vote, but how to reduce the deficit over the next few years - how to make the working class pay by cutting jobs, pay and services.

The opinion polls and media have gone from predicting a Tory landslide several months ago, to suggestions of a hung parliament with the Liberal Democrats as king-maker. In parallel with this, Gordon Brown has gone from being characterised as a liability for his party to predictions of an unbelievable political comeback. Meanwhile cynicism and apathy have grown with every new scandal about corrupt politicians. But, however the election turns out, all parties know that the priority for the next government is the deficit and the economy. And whether they prioritise cutting the government deficit, or are restrained by fear of a new recession, they all know that they have to attack the working class.

Efficiency savings = job losses

The British economy shrank by 6.2% in the recession and the technical recovery remains fragile at best. Borrowing this year is predicted to be £167bn - down slightly - and to peak at 74.9% GDP in 2014-15. This was the background to the 24 March pre-election budget, which maintained a discreet silence on the attacks they are bringing in, but couldn't hide them completely. Hidden away in a separate document was the plan for £11bn efficiency savings - including 4.3bn in the health service by cutting among other things the IT programme and staff sickness. These savings can only be based on job losses, even if these will not be specified till after the election. As for savings on staff sickness, postal workers and BA staff can tell us what that means: the development of a culture of management bullying.

The TV debate between the Chancellor and his Tory and Lib Dem shadows only reiterated the need for ‘efficiency savings' to cut the deficit. Osborne pledged £12bn, by reducing waste and controlling recruitment. None of them want to say how they will make the savings, whose jobs will go, who will work longer and harder, before the election. Instead they talked about how they would use half these savings - Osborne wants to limit the planned increase in National Insurance contributions to those earning over £35,000, Darling and Cable say the country can't afford it as it's needed to cut the deficit. On the other hand, they claim to want to plough savings back into ‘front line services', which doesn't add up either, both because they've just told us it's needed to reduce the deficit and because once they've cut jobs in ‘efficiency savings' they will be short of workers to deliver the services. So services will also go on being cut - that's health, education, care of the elderly, everything they have promised to maintain.

Cuts will be tougher than Thatcher's

Opinion polls confirm that while there are many wanting a change, this does not necessarily mean wanting a Tory government. Disgust with the present Labour government cannot completely outweigh suspicion that a new Tory government will attack on the scale of Thatcher in the 1980s when unemployment trebled. We should be in no doubt what the next government will bring in, whichever it is. Darling's budget speech announced that the new spending review would be the "toughest in decades" and in a BBC interview he confirmed that this means a new Labour government's spending cuts would be "tougher and deeper" than Margaret Thatcher's, "What is non-negotiable is that borrowing is coming down by half over a four-year period." George Osborne is competing with the Chancellor on who can promise the deepest cuts after the election, and Nick Clegg has joined in the criticism of a budget that made no mention of the intended cuts.

The Institute of Fiscal Studies points out that spending increased 1.1% a year under Thatcher, three times the 0.4% pencilled in by the Chancellor for after the election: "if we subtract spending on welfare and debt interest then we estimate that the rest of public spending would be cut in real terms by an average of 1.4% a year compared to an average increase of 0.7% in the Thatcher era. We have not seen five years with an average annual real cut as big as this since the mid-1970s." This is also a useful reminder that the real effective cuts of the 1970s were more scathing than under Thatcher, although her government did its best to follow the example of its Labour predecessors.

Brutality of cuts - now and in the future

The contraction in the UK economy has already had a deep impact. Official figures for unemployment have marginally declined, but so have figures for those employed. The number of people working part-time (in many cases reluctantly) continues to climb. The number of people claiming Jobseekers' Allowance is higher now than at any time since Labour came to power in 1997.

The official figure for people who are ‘economically inactive' does include students, the long-term sick, unpaid carers and those who retire early, as well as those who are officially unemployed and the ‘discouraged' who have given up looking for work or have been bureaucratically barred from claiming JSA or other ‘benefits'. However, even when you allow for categories such as students (who might well have taken up study because of the poor prospects for employment) the current figure of more than 8 million, more than 1 in 5 of the working age population, the highest on record, is a stark condemnation of the capitalist economy's capacity to employ the class that creates most value in bourgeois society.

As for the impact of future cuts, bourgeois commentators have made no attempt to hide the staggering prospect of what's in store. Try this extract from an article by John Lanchester in the London Review of Books (11/3/10). "Broadly speaking, the circumstances are such that it shouldn't much matter who wins the election, not in economic terms. ... The reality is that the budget, and the explicit promises of both parties, imply a commitment to cuts of about 11 per cent across the board. Both parties, however, have said that they will ring-fence spending on health, education and overseas development. Plug in those numbers and we are looking at cuts everywhere else of 16 per cent. (By the way, a two-year freeze in NHS spending - which is what Labour have talked about - would be its sharpest contraction in 60 years.)

Cuts of that magnitude have never been achieved in this country. Mrs Thatcher managed to cut some areas of public spending to zero growth; the difference between that and a contraction of 16 per cent is unimaginable. The Institute for Fiscal Studies ... thinks the numbers are, even in this dire prognosis, too optimistic. ... The guesstimate for the cuts, if the ring-fencing is enforced, is from 18 to 24 per cent. What does that mean? According to Rowena Crawford, an IFS economist, quoted in the FT: ‘For the Ministry of Defence an 18 per cent cut means something on the scale of no longer employing the army.' The FT then extrapolates: ‘At the transport ministry, an 18 per cent reduction would take out more than a third of the department's grant to Network Rail; a 24 per cent reduction is about equivalent to ending all current and capital expenditure on roads. At the Ministry of Justice an 18 per cent reduction broadly equates to closing all the courts, a 24 per cent cut to shutting two-thirds of all prisons.'"

As it's clear that the state will continue to have an army, courts and prisons, the effect on those areas that will be cut will surely be even more dramatic.

Does the election matter?

Whoever wins the election, the next government will defend the national capital, by cutting jobs, reducing real wages, reducing services, and, when it's in the national interest, sending young soldiers to fight in imperialist adventures like Afghanistan. For workers there is nothing to choose between any of them. However the results do matter, and it is clear that the ruling class do not simply leave this to chance, not because there is any doubt that any of the serious contenders would carry out the necessary attacks, but because they want to prepare the ground to make it as hard as possible for the working class to resist them. Media stories about Brown the ‘ditherer', the Sun's support for the Tories, give some idea of how they are thinking. David Cameron's claim that Labour are in hock to the unions shows us why - they want us to think that we can rely on the unions and the left to resist the attacks that are being planned, and to think that voting in the election will make some difference, despite all experience to the contrary.

The working class also has to prepare - not by voting, not by apathy or cynicism, but by remembering all the attacks by governments of right and left, both here in Britain and abroad, over the last 40 years, and by discussing and drawing the lessons of the efforts to struggle against those attacks.   

Alex 2/4/10


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