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From International Socialism, No.21, Summer 1965, pp.2-3.
Transcribed & marked up by by Einde O’Callaghan for ETOL.
Booms dissipated the three successive attempts of the Tories to control wages, but Wilson is unlikely to surrender his wages policy without a fight – partly because no rip-roaring boom is yet in sight, partly because even partial success would be a substantial accretion of power to British capitalism: a one per cent shift in incomes from wages to profits could add some 15 per cent to net fixed domestic investment. Again, control of wages and all it would imply in terms of integrating the unions into a subordinate role in the planning of the economy would be a major breach in shop-floor defences – including job security (’restrictive practices’). The Labour Government would have made the decisive step in proving to capitalism that it was able and willing to exercise the central control of the economy – a control the Tories have so far proved themselves incapable of mastering. Such confidence could make the fortune of the whole Labour front bench. But it is not going to be easy. The trade-union bureaucracy knows the limits of its power, and has not been unanimous in its support for an incomes policy. The current sellers’ market for labour, with settlements blithely bursting through the flimsy ‘norm’ (the Government, much as the Tories before it, rush for the cover of: ‘This is a special settlement to redress great hardship’), is too good to resist, particularly when a wages policy might in the future reduce such gambols to a minimum. Many trade-union leaders have not forgotten the Great Retreat from the Crippsian Wage Freeze of twenty years ago and the terrible record of reputations lost and careers mutilated by rank-and-file guerillas and government recriminations. In their hearts, nearly all fear the unfolding of the prediction that ‘factory organisations will turn wage drift into a rip-tide. There would be a transfer of power from those who formally hold it to those informally willing to exercise it’; and nearly all would say ‘amen’ to the conclusion, ‘For me this isn’t on’ (Clive Jenkins, General Secretary ASSET, Tribune, 30 April).
There is more than the union leadership’s traditional immobility. Underlying their hesitancy is a growing disenchantment among many of their members with wide, politically-coloured blanket settlements that don’t seem to mop up the gravy that there is around. In a rapidly changing economy, workers in large, expanding units, and white-collar workers with technological skills are able to use their strategic position to pull well ahead of the others. They want freedom to do so, to strike sectional bargains that focus the strength of their position, without commitment to those in weaker positions. They come out best in a free for all, as do the companies expanding fastest. It is on this basis of confidence and proved strength that is partly founded the growing strength of shop-steward and other workshop-based organisations. It is an attitude that feeds the rapid expansion – against the trend – of white-collar unionism, as well as diluting labour’s traditional loyalty to Labour. It represents a serious fragmentation in the movement, a decline in solidarity, but it also lies at the root of the union bureaucracy’s hesitation on wages policy.
The Government is in no position to reverse these trends – indeed, capitalism needs just this type of shifting power for its changing expansion. But the Government cannot afford to submit to union diffidence. An incomes policy it must have: and if the substance escapes, the appearance will have to do. So it is that behind the talk of voluntary restraint, all the old machinery of ordinary deflation (so systematically denounced by Wilson in Opposition) is doing the real job. In its short life, the Labour Government has planned a larger reduction of purchasing power than any since the War. It has striven more manfully than any to arm its policies with the honed edge of unemployment. With unemployment, it does not need an incomes policy – global wages will ‘voluntarily’ conform, even if the unions don’t. That it has succeeded less than it thought it might (since the policies come at the prelude of, ordinarily, an upswing), that these policies are formulated with an eye cocked at international confidence, is neither here nor there. The key point is that the most vile of Capital’s weapons – planned unemployment – is now deemed necessary to effect the incomes policy, that Labour’s special solution for the weaknesses of British Capital has thus merged into the standard presription of all Capital, especially weak Capital – when in doubt, deflate and dismiss, restrict and reduce.
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