Issue 228 of SOCIALIST REVIEW Published March 1999 Copyright Socialist Review


The Euro: against...

Francis Wheen suggests that socialists should support EMU, because at least it will be 'a rebuke to the poisonous petty nationalism' of papers like the Sun (February SR). The mainstream argument about EMU, however, is not one between 'internationalism' and 'nationalism'. It is about what is best for the British economy. It is true that 'reactionary buffoons' in the Tory Party are against Europe, but those in favour can hardly be held up as progressives. In general, big business and multinational companies are in favour of the euro, and they will start to apply more and more pressure for Britain to join.
I recently did some work for a major investment bank, getting their computer systems ready for the euro. They were in no doubt that EMU was good for big business. Managing thousands of different investment funds, in different currencies, they no longer have to pay to transfer investments from one fund to another, as long as they are in the euro. Wheen might be cheered by the 'collapse of profits of bureaux de change', but the main beneficiaries of the fixed rate will be large companies who stand to save billions.
Wheen argues that Britain would be more insulated from the ravages of the market, and especially from international currency speculators, if it were in the euro. This is rubbish--the bulk of British trade is with Europe, and therefore joining the single currency would have the effect of intensifying market competition within the European sector. This is precisely what certain weaker sections of British capitalism are scared of--being exposed to equal competition with companies in Germany or France.
EMU is part of a long term strategy, the purpose of which is to strengthen capitalism in Europe, and to give European companies the edge over those in the US or Asia. The ruling classes are committed to making this work and they don't care who suffers in the process. Of course there are all sorts of problems with this strategy. Capitalism is a system which is beyond their control, and it is clear that our rulers haven't got a clue how the system really works. However, it would be ridiculous for socialists to collude with their overall aims.
Suppose, for example, one of the weaker economies (such as Italy or Ireland) begins to encounter serious problems while in the euro. In order to remain in the union and adhere to the fixed rate, we could see governments introducing massive cuts in public spending, companies going to the wall and unemployment rising. Ruling class commitment to the euro would then present itself as a key cause of working class misery.
Joe Hartney

...the abstention...

I was interested in your article, 'What's the question?' on the issue of the euro and a possible referendum in Britain (January SR).
Writing about the 1975 referendum on British membership of the EEC you write, 'The Labour left and CP essentially gave up their independence and agreed to share platforms with the right.' But, of course, it is possible to refuse to share platforms with Tories and still give up political independence.
You say that the issue last time was 'Europe versus Britain', and add that the forerunner of the SWP called for a 'no' vote (therefore, logically, according to your own account, choosing Britain)--which seems like a loss of independence and a capitulation to British nationalism. This time you say, 'The arguments are clearer'--a referendum vote would be about 'what kind of Europe' we want--and you conclude that, again, a 'no' vote would fit with defence of jobs etc.
However, the main camps in such a 'euro' referendum would be dominated by the pro-capitalist Blair-Clarke 'yes' camp, and the (even worse) little England Tory leadership's 'no' camp. The real question--will be: the British pound or the European euro? No doubt, in such a situation, Tony Benn and co would tag along after Portillo and Redwood, condemning those suspicious German bankers for trying to take away 'our' sovereignty.
The revolutionary internationalists need a clean banner. The slogan of abstention was right in the 1970s and it would be right in a referendum on the euro.
Keith Deville

...and the question

I cannot agree with some of Dave Beecham's article (January SR), particularly the implication that there should be a campaign against EMU, although I am not advocating one for it either. In this anxiety to campaign we are losing sight of the opportunity to publicise the fact that British workers are probably the most exploited in Europe and to pressurise the TUC leadership for its servile accommodation to New Labour.
Across the EU cuts to welfare state provision has been resisted (which Socialist Worker and Socialist Review have publicised and applauded) usually by sections of the mass workers' movement which also accepted the single currency, for example in Italy, Germany and Greece. They realised that Maastricht did not say 'there must be cuts', only that governments 'must not borrow'--which does not exclude taxing the rich and employers to pay for welfare states. The outcome depends on the balance of class forces, not on whether workers are for or against the single currency. The workers in most of the EU have lost out over welfare states to some degree, but nothing like so much as in Britain, and their losses could easily be reversed.
There has already been a significant degree of harmonisation, especially between the major EU countries France, Germany and Italy, in which the UK has not shared. I think that some harmonisation must come before a single currency, not after. No one could accuse the SWP of ignoring pensions and pensioners but over harmonisation pensions are perhaps even more important than taxes. Pensions are paid primarily from social security taxes (national insurance) in every EU country (except Denmark). The figures show that this tax in Britain is only half to a quarter of its level in the major EU countries. This is entirely due to UK employers' contributions to social security taxes being only 11 percent of wages against around 50 percent for the rest. This makes UK labour almost the cheapest in the EU. But the cheap labour chickens come home to roost when workers retire, which is why British pensioners are the paupers of Europe.
With the UK working class in this unenviable position, to campaign against any closer relationship with the EU--on the grounds that the EMU is a bosses' plot--is a little bizarre and you have a few questions to answer. The consequence can be to downplay the information to avoid awkward questions.
The 'bosses Europe' slogan is, in one sense, obvious. Of course they rule, but not unchallenged. There is a class struggle going on in every country in the EU and across the EU as a whole, in which the UK working class scores very badly. There are also tensions between national bourgeoisies and between industrial and finance capital.
The UK capital market (the City) is valued at more than the bourses of France, Germany and Italy put together, although the UK GDP here is smaller than any of them. Another obstacle to EMU? As we all know, the City's main occupations are currency speculation and ripping off the workers' pension funds, which barely exist in the rest of the EU and which account for half the UK capital market--which also puts the UK way outside the rest. This creates more problems over what is to be done if the UK is to join EMU. Will the City be able to continue with the biggest and longest running gravy train in Europe? Will the rest seek to muscle in or cut it down to size?
Finally, the crucial question is whether the closer integration of capitalist dominated Europe will assist the working class to better coordinate its struggles against capitalism. If we assume that the workers are bound to lose out, what becomes of our belief in the eventual triumph of socialist internationalism? We are never going to face that struggle under conditions of our own choosing, are we?
Hugh Lowe
West London

Western disunion

No one should be fooled into thinking that tensions inside the Labour Party are only to be found in Wales, Scotland and London. Here in Bristol and the West Country there is growing evidence of widespread disaffection.
So one long standing stalwart and chair of a south Bristol ward resigned, apparently promoting a crisis meeting with the local Labour MP. In another case, the TGWU convenor of a factory in Wiltshire is standing down as a local Labour councillor in disillusionment. And the former Labour mayor of one West Country town, a hospital worker, has cancelled his membership.
Meanwhile Gloucester City Labour council is split between Blairites and Old Labour, and in Bristol the leader of the Labour council is against local school closures proposed by the Labour run education committee.
Bristol South MP Dawn Primarolo is a symbol of betrayal for many inside the Labour Party. Once a Bennite, 'Red Dawn' refused to pay her poll tax. Now, she has backed the cuts to single parent benefit. The reward was promotion to paymaster general.
There may as yet be no simple focus to these tensions, but the echoes of the coming political civil war inside Labour can already be clearly heard in the West Country.
Mark Thomas

Homes for the poor

It is worth expanding on something that is not mentioned in last month's excellent article about housing (February SR). This is the role of housing associations which are taking over the council stock.
It's only in the last ten years that housing associations have really taken off. In 1981 the number of homes run by councils was 15 times the number run by housing associations--today it is just three and a half times.
Along with the radicalisation of 1968, a layer of people were motivated to do something about homelessness. Organisations such as Shelter came to the fore and a spin off was that a layer of well meaning professionals, architects and planners decided to use their talents to provide new homes that could respond to the needs of various communities. So housing associations--non profit making charities--were born. However, they were still small scale operations run on a shoestring carried along by the enthusiasm of the founders.
Then the Tories were elected and they hated two things--Labour councils and council housing. However, they still needed to provide social housing so they turned to the housing associations. The Tories set up a mechanism to make sure that the 1970s radicals didn't challenge the ideas of Thatcherism.
To get funding to do serious renovations or to build new homes a housing association must borrow money from the banks to be paid back from the rents collected. And any project has to competitively bid against others. Last year for every nine bids submitted only one was accepted. A key criterion for acceptance is cost, so there is a downward pressure to cut costs and build cheap homes. Housing associations became businesses, and the voluntary boards were replaced with directors and chief executives.
The framework set up by the Tories means that housing associations are worse than the councils they replace. For example, you are more likely to get evicted for non-payment of rent from a housing association than for non-payment of your mortgage by a building society. You have no say in how they are run. At least with the local council you could go and harangue your local councillor.
There is a problem with the whole concept of social housing today. At the end of the Second World War the slogan was 'Homes for all.' The idea was that social housing would be for everybody and the new model estates that were built were for people from all walks of life. Today the slogan of social housing should be 'Homes for the poor.'
New Labour, for all its talk of social exclusion, is continuing the work of the Tories in selling off estates. one consequence of housing associations being forced to bid against each other is that they build on the cheapest land which is in the poorest areas. So social exclusion is built into the way social housing is developed.
The present setup means that social housing will remain the ghetto of the worse off, run by people with very few resources, accountable to no one, who simply become glorified rent collectors. There is an alternative but it means challenging the present housing setup and arguing for more resources.
David Smith

Hidden history

In her review of Noel Thompson's book The Real Rights of Man, about working class political economies from 1775-1850 (Februrary SR), Gill Hubbard notes that Thompson does not include Marx and Engels. Indeed he doesn't, and this is no accident.
Thompson is one of the school of historians, albeit one of the more interesting ones, intent on providing a history of the British working class which leaves out Marx and Engels. It is a history which New Labour could feel comfortable with if, that is, it was interested in history in the first place.
In reality the ideas of Marx and Engels had a significant impact on the most radical sections of the British working class from the late 1840s onwards. The first English translation of The Communist Manifesto appeared in the Chartist paper The Red Republican and both Marx and Engels wrote quite regularly for Ernest Jones's People's Paper, the major Chartist paper of the 1850s.
The beginnings of the impact of Marxist ideas on British working class activists coincided with a period of downturn and defeat for workers after 1848, so Marx and Engels were not able to construct a current in the labour movement that was completely convinced by their ideas alone. Thompson's work gives a clear idea of some of the other competing theories of exploitation, of which probably the most influential were those of the Chartist leader Bronterre O'Brien. Marx called O'Brien's supporters on the First International 'currency quacks', but Marx and Engels were able to build that organisation and find an audience for their ideas within it in the decade that the TUC was founded and several decades before the Labour Party came into existence.
If it were not for the fact that Blair never knew this history in the first place he would certainly prefer that we forget it.
Keith Flett

A sort of new horror

It was great to see Socialist Review cover more offbeat areas of entertainment in John Newsinger's review of Hellblazer, the US horror comic (February SR). However, as a socialist who spends perhaps far too much of his time and money on horror movies, some of John's comments lead me to conclude that he hasn't seen a horror movie since the 1950s!
John is right to say that in the horror movie, society comes under threat from forces which threaten to overturn it, but in reality this happens in almost every genre to a greater or lesser degree: Westerns, sci-fi yarns, conspiracy thrillers and action movies all have this quality, where superficially good and evil battle it out in some way. What is important to note is that the form and content of films are generally tempered by the social and political climate of the time. This is why in the case of the horror genre you had in the 1950s a whole slew of films like The Thing From Another World, Earth Versus the Flying Saucers and The Blob, which fit John's notion of the horror film very nicely--they are essentially conservative and most display 'better dead than red' type attitudes.
By the late 1960s and during the 1970s, with the Vietnam War, Paris 1968, Martin Luther King, Malcolm X and increasing unrest, the picture had become increasingly different. In the films of George Romero, Tobe Hooper, Wes Craven, Larry Cohen and many others, John's idea of the horror movie was turned on its head. The horror was now in some form or other a creation of capitalism, people died slowly and violently (just like they did in Vietnam), and in the very best of these films the traditional heroes--the police, the army and the rich--are complicit in the horror or at the very least offer no solutions to its resolution.
In the 1980s, with Ronald Reagan hand in hand with Rambo, many films tried to reverse some of these things, and for the first time since the 1950s the horror film did show recourse to religion in order to resolve the terror. But for every Exorcist III or Dracula remake there were films like Henry: Portrait of a Serial Killer in which religion figures nowhere and the horror is very firmly based in the poverty and alienation of the characters, or Texas Chainsaw Massacre II where cannibalism and capitalism together run amok in the American Deep South as the police and government turn a blind eye.
Most people will probably never get a chance to see many of these films, due to the extreme conservatism of the BBFC, but they do show the genre in a very different light to the one John Newsinger amateurishly cast over it.
Joseph Lancaster

The war economy

Militarism has recently been a major ecological and human hazard. Human mass destruction of other humans through war has a long history. But the 20th century has seen a sharp escalation in the level of such destructive violence. Military technology has enormously expanded the capacity to kill and destroy. The end of the Second World War ushered in the first use of atomic bombs capable of wiping out entire populations of cities at one blow. Nuclear weapons also leave behind the legacy of slow death from radiation for generations to come.
Between 1950 and 1990 the United States expanded its military spending from $13 billion to $300 billion. The total US military spending since 1945 has topped $4,400 billion; $1,500 billion from 1945-75; $1,500 billion from 1976-85; and $1,400 billion from 1986-90. In 1990 the US federal deficit topped $3,000 billion, with a large piece of the budget taken up with paying interest on this debt. Military expenditures worldwide have expanded continually in the last 20 years. The US expanded its share of world armaments in this period from 22.8 percent to 30 percent.
Military expenditure has drained all nations of the world of the funds that might have been more than adequate for solving many of the social problems of hunger, illiteracy, lack of adequate housing, medicine, and drinkable water.
US and EU intervention in Africa has succeeded in fuelling many regional wars, with devastating death tolls, frustrations, and environmental destruction, typically followed by more military build up. The African People Awareness Campaign (APAC) estimates that between 1980 and 1989 there were 20 different wars going on that took a total of 4 million lives.
Much of the weaponry of the second half of the 20th century has not been directed in defence against outside nations, but has been turned by governments against their own people. The military of this period reflects four interlocked levels: 1)The global East-West competition between the capitalist and Stalinist blocs. 2)Regional conflicts, such as the Arab-Israel, and Iraqi-Kuwait invasion. 3)Internal civil wars, such as those in western Africa, central Africa and central America. 4)Tribal wars such as Ijaw-Itshekiri, Kosovo (Serb-Albanian).
These regional conflicts have seldom been purely 'internal' but have been fuelled by the superpowers'--especially US--intervention. Civil wars also have a global dimension, with arms sales and the transfer of aid from all over the world. For example, Iran and Iraq, in their devastating 1979-88 stalemate war with each other, went on a huge military spending spree. The two countries received arms and military aid from 41 different countries. Some 28 of those countries provided 93 percent of the arms and sold arms to both sides of the conflict.
In 1954 the US sponsored a coup that overthrew the reform minded government of Jacobo Arbenz in Guatemala. The democratic constitution developed by this regime was replaced. and a violent repressive military regime with US support has ruled the region ever since. Guatemala was the first country to see the development of government sponsored 'death squads', which murdered peasant and labour leaders and other reformers. In response. small Guatemalan, guerilla armies came into being. The same tragic patterns of destruction have been going on in most African states, particularly central and west Africa. This includes the potential Africa superpower Nigeria whose unity is at the tip of a gun and might disintegrate in a great implosion if the Abubakar led junta does not properly address the issue of exploitation, oppression and marginalisation of some sections of the country. Furthermore, Abubakar's collaboration with the US government to establish a base for the FBI in Abuja amounts to a total betrayal and sell out of the Nigerian state. The establishment of an FBI base will turn Nigeria into a Puerto Rico where the US government determines who rules. The US interest in Nigeria is economic. It's high time we (Nigerians) learn to do without the US and their British allies. Thus, if we believe in justice, equity and fair play then the sovereignty of every nation must be respected by others. Thus the writer believes that global peace can only be achieved by first destroying the US weapons of mass destruction and to stop the US from interfering in the internal affairs of other countries, by means of conflict sponsorship or resolution.
Chilos Godsent
African People Awareness Campaign (APAC)

We welcome letters and contributions on all issues raised in Socialist Review. Please keep your contributions as short as possible, typed, double spaced if you can, and on one side of paper only.
Send to: Socialist Review, PO Box 82, London E3 3LH

Return to
Contents page: Return to Socialist Review Index Home page