No end to austerity with the new Labour government

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Today, almost two months after the landslide victory for Keir Starmer and the Labour party, it seems more clear than ever that the promises from the electoral campaign - “change begins now” and “an end to austerity - have disappeared, as different ministers announce new cuts in public spending for the coming autumn. Last week, when Keir Starmer was interviewed on BBC, he was clear that Labour MPs have to back the plan to cut the winter allowances for pensioners, except the poorest ones, and several of them were suspended for voting against the decision to maintain the two-child cap for child benefits.  This is a clear example of the policy this government is planning, for the population in general and especially for the working class. When the new Chancellor Rachel Reeves found a “black hole” amounting to £22 billion in the budget of the “irresponsible” Tories (the same argument that Cameron and Osborne used in 2010 when they took over from Gordon Brown and Labour) this is just a way of hiding the real, chronic problems of the British economy. Today, the new PM is clear: Keir Starmer said there is a need to be “honest with people about the choices that we face”, that he defended a choice he “didn’t want”, adding: “Things will get worse before they get better.” And he adds: “There is a Budget coming in October, and it’s going to be painful. We have no other choice, given the situation that we’re in.”

But things will not get better. If we look back to before the pandemic and the cost of living crisis, the cuts made since 2010 have meant a brutal decrease in real wages for the working class over more than a decade:

“When it comes to poverty, the failure of incomes to keep pace with wages is not just the result of the cost-of-living crisis — it’s also due to cuts to welfare payments and caps on public sector wages that were a central part of the cuts made since 2010. Before 2020, the UK had experienced the longest stagnation in wages since the Napoleonic Wars. Rising inflation exacerbated this challenge by eroding incomes further. We now have the highest rates of absolute poverty in thirty years, including a quarter of children living in absolute poverty. The Institute for Fiscal Studies has warned both parties that balancing the books by the end of the next parliament is likely to require an astonishing £20 billion worth of cuts per year”.[1]

Despite the wishful thinking expressed by some Labour politicians during the election campaign (“Read my lips: no austerity under Labour”, etc.) the Labour government is forced to launch further attacks. Some of the comments from political journalists speak for themselves:

“The new government insists it is ending austerity. It isn’t. Few of the changes this country requires can be achieved while adhering to the ‘tough spending rules’ the new government has imposed on itself. As the Institute for Fiscal Studies (IFS) pointed out in June, Labour’s plans mean that public services are ‘likely to be seriously squeezed, facing real-terms cuts’. Similarly, the Resolution Foundation has warned that, with current spending projections, the government will need to make £19bn of annual cuts by 2028-29. However you dress it up, this is austerity”[2].

A long history of attacks on the working class

We only need to go back around thirty years to see that the years of Tony Blair, whom Starmer is referring to as an inspiration, were not as glorious as the bourgeois present them: during the Blair era, the years of “Cool Britannia”, were not so “cool” for the working class. The Blair government systematically attacked working class living standards: demands for increased productivity, decreasing unemployment benefits and pensions weighed hard on the entire class[3]. Before that, at the end of the seventies, the Labour government introduced the wage limits in the public sector that sparked off the “Winter of Discontent” 1978-79.

We could give further examples of how Labour governments have administered austerity, from the Atlee government after the Second World War, to Wilson in the 1960s. The truth is that a Labour government is a better choice for the bourgeoisie when it comes to driving through unpopular decisions. The fact that Labour came to power this summer was first of all the result of widespread anger with the Tory government, and above all of the bourgeoisie’s need to stabilise its political game faced with populist vandalism.

No change for the working class

The recent pay rises to key sectors like railways, education and health, which have been awarded by the Labour government, in an attempt to “clear the ground” before the October Budget and the announcement of what is already called “hard but necessary cuts”. But the austerity measures and cuts in the public sector planned by the new Labour government will certainly provoke new outbursts of combativity. Even today there are still many disputes simmering or breaking out, from university workers in Hull to teachers in London, from bus drivers in Scotland to workers in supermarkets. More importantly though, the breakthrough in the class struggle that began in Britain in the summer of 2022 was the product of many years of attacks and a growing awareness and determination that “enough is enough”. It began a whole new phase in the class struggle which goes much deeper than a random pay rise or strike threat.

 No matter how much Sir Keir points to his working class background, the “responsibility” and the “stability” they are endeavouring to impose shows that the Labour government is currently the most suited instrument for launching further attacks on the working class. Workers should have no illusions about that.

Edvin, 15th of September, 2024

Rubric: 

Britain