Wednesday, October 26, 2011

Labour's Janus head

At the end of June Greece's governing party began to push another austerity programme through parliament, and came a little closer to collapse. After expressing unease at mass lay-offs of public sector workers and cuts to pensions, and refusing outright to support a law which rolled back the legal rights of unions, the long-serving member of parliament Panagiotis Kouroublis found herself expelled from her party.

Kouroublis may have lost some friends in parliament, but she has become a heroine to the hundreds of thousands of Greeks who have been protesting against the austerity programme with marches, occupations, strikes, and riots. Political analysts have taken to describing Greece as 'ungovernable', and a report by the CIA suggested that a military coup might be the only way to get protesters off the streets.

It is worth noting that the government pushing radical neo-liberal policies on an unwilling Greek working class is filled not with evil bankers or a set of emissaries from European Union headquarters in Brussels, but with social democrats. The Panhellenic Socialist Party (PASOK) has traditionally enjoyed the support of the majority of the Greek working class, and includes in its leadership many former trade unionists. But it is not unprecedented for a social democratic party to respond to an economic crisis by attacking unions, wages, and the welfare state. When the Great Depression came to Great Britain in 1929, the Labour government of Ramsay MacDonald decided to cut spending on pensions and schools, acquiesced in mass sackings of workers, and refused, despite the urgings of John Maynard Keynes, to borrow money to stimulate the economy. Businesses were delighted.

In New Zealand the Labour government elected in 1984 was greeted by a debt repayments crisis and a run on the Kiwi dollar. Under the leadership of David Lange and Roger Douglas, the party responded with one of the most thoroughgoing and devastating set of neo-liberal policies seen anywhere in the world. State assets were flogged off at bargain basement prices, tens of thousands of public sector workers found themselves in the dole queue, student fees were increased by several hundred percent, and a Goods and Services Tax which hit the poor hardest was introduced at the same time that company tax rates were lowered. 'Rogernomics' was a blow from which poorer Kiwis and the trade union movement have never altogether recovered.

Labour itself has never quite recovered from the Lange-Douglas era. The party suffered a massive membership decline in the 1980s, and it remains a relatively small organisation today.

Ramsay MacDonald and David Lange were condemned as traitors and as lackeys of the rich by many of the grassroots supporters of their parties. Today similar insults are aimed at PASOK leader George Papendrou by the crowds on the streets of Athens and Thessaloniki. But the likes of Lange and Papendrou are not aberrations so much as expressions of one side of the contradiction which is social democratic politics.

At the beginning of the 1920s, when Ramsay McDonald was promising that the Labour Party would govern Britain in the interests of workers rather than employers, Lenin wrote his famously bad-tempered book Left-wing communism: an infantile disorder in an attempt to sum up the nature of social democracy. Lenin described organisations like Labour as 'bourgeois workers parties' - that is, as parties which claim to represent workers, which have mass working class support, and which advocate some policies beneficial to workers, but which side, in the final analysis, with capitalism and the employing class.

During good economic times, Lenin argued, social democratic governments can reward their supporters by delivering them better state services and higher wages. When capitalism goes into crisis, though, and profit levels have to be restored, the bourgeois workers party comes under pressure to save the system it has sworn to work within, by cutting wages and state spending, and siding with bosses against trade unions in industrial disputes.

Lenin was writing before the 1930s, when a number of bourgeois workers parties, including New Zealand's Labour Party, got elected to government and implemented the sort of policies Keynes had unsuccessfully urged on MacDonald. These governments increased rather than cut state spending, borrowing money to cover rises in benefits and wages as well as public works projects designed to stimulate the economy. Keynesian policies were generally pursued because of pressure from trade unions and unemployed workers' organisations, and in spite the protests of big business and the political right.

Like the Roman God Janus, then, social democratic parties have two faces. They can, depending on the state of the economy and the balance of social forces, adopt either moderately progressive or revanchist, pro-business policy programmes. Keynesianism and austerity are both aspects of the social democratic tradition.

The contradictory quality of social democracy is evident in the Labour Party's campaign for November's general election. On the one hand, the party is demanding a rise in the minimum wage and the substitution of a Capital Gains Tax for some of the tax burden the poor presently carry. These measures would, if implemented, increase the spending power of the working class and - in theory, at least - stimulate the economy in traditional Keynesian fashion.

But a very different Labour Party has been campaigning in the wealthy Epsom electorate, where shadow spokesman for Economic Development David Parker is trying to win votes away from Act candidate and former Auckland mayor John Banks. In a recent guest post for David Farrar's right-wing Kiwiblog, Parker revealed that he was trying to appeal to Epsomites by presenting Labour as a 'fiscally responsible' party. Parker wrote that:

John Banks tripled Auckland City Council's debt...This recent history is very damaging for Key as well as Banks, given their repeated assertions that they are fiscally responsible...Labour under Michael Cullen ran substantial surpluses and reduced government debt, which Key and Brash opposed. There is a widening acceptance that Labour were fiscally responsible, at a time when the USA, UK, and most of Europe were not...

In a time of economic crisis, Parker's enthusiasm for 'fiscal responsibility' and his espousal of balanced budgets should send shivers down the spines of left-leaning Labour supporters and trade unionists. It is, after all, in the name of 'fiscal responsibility' and against the perceived excesses of the pre-crisis years that the governments of nations like Greece, Britain, and Spain are forcing through neo-liberal austerity programmes today. For politicians like George Papendrou and David Cameron, balancing budgets means gutting public services, laying off hundreds of thousands of workers, and selling state assets. (The fact that Parker throws an allusion to the Occupy Wall Street movement and a criticism of neo-liberalism, aka 'the Chicago School of Economics', into a later section of his article doesn't detract from the significance of his rhetoric about 'fiscal responsibility'; it only shows his shamelessness.)

Parker's rhetoric should also remind us of the Lange-Douglas government of the 1980s, which took pride in positioning itself to the right of its National opponents during debates about state ownership of assets and public spending.

If the global economic crisis continues and New Zealand experiences the sort of meltdown which has been the fate of Greece, will a Labour government respond by turning to the Keynesian policies of the 1930s, or to the scorched earth neo-liberalism of the '80s? The lack of influence of Labour's few grassroots members over the party's parliamentary wing and the lack of power of the contemporary Kiwi trade union movement make a repeat of Rogernomics a distinct possibility. Parker's revival of the rhetoric of the 1980s certainly shows how little commitment senior Labour MPs have to left-wing principles and policies.

As the Greeks are learning, social democratic governments can be the most ruthless defenders of crisis-ridden capitalism.

Footnote: Labour offered another bad omen today.

[Posted by Maps]

20 Comments:

Anonymous Anonymous said...

who to vote for then??????

4:04 pm  
Blogger Skyler said...

I'm sure Maps would say vote for Mana.

6:46 pm  
Anonymous Anonymous said...

then he is obviously an extremist and not to be trusted

7:17 pm  
Blogger Richard said...

Vote for National. I recall 1984 when the Unions urged us to vote for Labour and said they would not sell off Government assets. The unions were in cahoots with Labour, and they were lying. They betrayed the working people. National hasn't done anything particularly (or unusually for such a a party) bad. Most of what they are about is rhetoric. The Lange-Douglas fascist Government was the worst we had in our history.

The Maori Party or Mana is a good idea. Voting for Mana doesn't mean one is an an extremist. Wait till we all start throwing bombs and those good ol' riots get a goin'.

The Greek people need to seize control of the state and implement socialism.

Voting is only a stop gap while the working class organizes. In fact it probably doesn't matter who one votes for. But Labour are not to be trusted any more than National.

8:40 pm  
Anonymous Scott said...

Richard, I can't keep up with your political shapeshifting! You were praising Mao the other day - and now you're calling for a vote for the Nats!

Our old comrade Roger Fox did tell me once that he used to see grafitti around in the late '70s and early '80s with the message 'Vote National - intensify the class struggle!'

And I do agree with you that the Fourth Labour government made Muldoon look good, when it came to the economy. That 1984 election slogan 'Vote Labour and get your son or daughter a job for Christmas' was truly sick and cynical, given what Lange and Douglas delivered.

I think that if Labour are somehow elected this November then, barring a sudden dip in New Zealand's economic fortunes, they'll pursue a path a little to the left of that beaten by National over the last three years. Goff might monkey about with a few public-private partnerships, and he'll certainly try to keep a lid on wage demands from the unions, citing tough economic times, but he won't revert to his 1980s neo-liberal persona.

But if New Zealand suffers the sort of meltdown seen in Greece, then whichever party is in office will face incredible pressure from international creditors, from foreign governments, and from local big business to implement very radical neo-liberal 'reforms' to 'save' the economy. The alternative will be to reshape the economy quite fundamentally, and to upset a lot of very powerful people.

Labour thinks of its job as overseeing and tweaking the capitalist economy, so as to deliver some rewards for its working class constituency as well for business. It thinks of capitalism, and indeed free market capitalism, as a necessary condition for its programme. It would likely therefore see the preservation of a recognisable form of capitalism as a necessity, not as the product of an ideological choice. We'd get the same 'There is no alternative' stuff that lange served up in the
'80s.

Of course, it's by no means guaranteed that we'll face the sort of crisis which has gripped Greece...

9:13 pm  
Blogger Richard said...

I've never been uncritical of Mao. I see him as "better" a than say Lenin. But both Lenin and Mao had big short comings.

This doesn't take away the great good they both did or their sincerity.

Stalin is quite different...

But these (say) Trotskyism is better than Maoism or whatever are as bad as Labour is better than National.

Your post points to the need to be wary of these parties.

When (late 60s early 70s) I was in the PYM (I was working at the freezing works or the railways I think then) I decided one election year to vote National. My thinking was as in Roger Fox's poster - I wanted to intensify the struggle. I wanted things to get worse. I was quite passionate re politics in those days but like Roger I had some personal difficulties. (But I wasn't a demoralized Party element (quite, Roger was nearly right!)...it was a bit more complex.

But that year I voted National Dick Fowler (who really started the PYM by the way) and his mother (she was in the Communist Party but had started in the National Party! Both were very well read people...I imagine a bit like the Thompsons. But Mrs Fowler was almost irate and they gave me a stern lecture about voting for National!)

More recently I did in fact vote for the Maori Party. But this voting is so limited as political action. "Political power comes out of the barrel of a gun" not by voting...but hmmm...

I've met Gogh and others in Labour at Brett Lewis's funeral(I criticized Moore (or his Party's hypocrisy as I see it as they still sing socialist songs etc and imagine that they are rebels and Commos and Reds when they all get drunk...(forgetting their big incomes, flash suits and big cars they drive around in) but to be fair I can relate to that as..hmm...)0; but he was a bit drunk and just said "sorry"..lol) and I didn't dislike them as in "hate" (it is hard do for me to hate anyone) but I could never be a part of that stuff. I somewhat admired Helen Clark but recall she didn't back Len Parker in his rent protest and they treated illegal immigrants quite cruelly.

The danger is ACT. The shadow of ACT.

At least people are taking to the streets in big numbers in Greece...Protests need to be world wide each time something like that happens so we all support each other on all working class issues whatever the nation. Nationalism needs to be subordinated for international working class action. Then the CIA would have some work to do.

There will be no peaceful transition from Capitalism to Communism.

10:14 pm  
Anonymous Anonymous said...

I don't see why fiscal responsibility and socialism don't go together. Debt is its own bondage.

It makes sense to run large surpluses and save for the bad times - in fact, it's orthodox Keynes!

11:23 pm  
Anonymous Anonymous said...

Planning for the worst-case scenario?
http://www.stuff.co.nz
/dominion-post/
comment/5851182/
It-never-hurts-to-
plan-for-worst-case-
scenario

12:49 am  
Anonymous Anonymous said...

'I see him as "better" a than say Lenin'

Better in what way sir?

12:50 am  
Anonymous Anonymous said...

October 24, 2011
11"Do you think we are the parasites of Europe?"
Fury Mounts Among Greek People
by PATRICK COCKBURN
Athens

Greece last week was paralysed by a 48-hour general strike that began Wednesday and cast doubt on the unpopular government’s ability to implement reforms demanded by the European Union in return for further bailout money.

Black-masked youths hurled chunks of marble and petrol bombs at riot police in front of the parliament building in the centre of Athens. Police responded with stun grenades and tear gas as clashes spread to neighboring streets after mass rallies, where protesters demanded an end to tax rises and salary cuts that they say are reducing them to poverty. Acrid plumes of black smoke rose from blazing bins of uncollected rubbish and mixed with the white clouds of tear gas. Chunks of rock and broken glass littered the streets around the parliament.

“We are going back to the standard of living our grandfathers had,” Eliza Giannakaromi, who was marching with municipal employees, said. “It is happening at every level of society, so the Stelios Georgiou, a garbage collector who was holding a banner near by, said: “We want to kick out this government. I used to earn €1,200 (£1,050) a month and now I get €700. They should go after the tax evaders and not us.”

About 100,000 people marched in Athens. Some of the participants tried to force anybody wearing a hood to take it off, accusing those who refused of being anarchists or undercover police agents. By evening, the street battles had spread down Ermou, a popular shopping street.

But it is dubious if a deeply distrusted government can implement reforms that people see as being dictated by foreign governments and banks.

This loss of sovereignty is deeply felt. A pensioner, who gave his name as Nikos and was waving a large blue-and-white Greek flag, said: “My son goes into the army on Monday and I don’t know whether to be pleased or sad.”

1:34 am  
Anonymous peter corner said...

I can't help but notice the parallels between the Versailles treaty reparations, and what the IMF wants from Greece - -to quote Keynes
"The policy of reducing Germany to servitude for a generation, of degrading the lives of millions of human beings, and of depriving a whole nation of happiness should be abhorrent and detestable,--abhorrent and detestable, even if it were possible, even if it enriched ourselves, even if it did not sow the decay of the whole civilised life of Europe."
http://en.wikipedia.org/wiki/John_Maynard_Keynes#The_Versailles_peace_conference

1:37 am  
Anonymous Rustico said...

Does anyone besides me ever stop and think, "How amazing it is that the universe exists, that our earth exists, that we are alive and aware that we are alive (even if only briefly), and aware of being alive?" We don't know where the universe came from. We don't know how life arose. There is no evidence for the existence of the being we call "God." But here we are. I have a garden (as Voltaire suggested) and I have chickens, and they provide us with very healthful eggs, and in a little while I will go tend to them.

2:17 am  
Blogger Richard said...

"Anonymous said...

'I see him as "better" a than say Lenin'

Better in what way sir?"

It read s wrongly, typos:

"I've never been uncritical of Mao. I see him as "better" a than say Lenin. But both Lenin and Mao had big short comings...."

That was a misspelling. I meant:

"I don't see him as necessarily or radically better (or worse) than (say) a Lenin or Thomas Jefferson who whoever...or say (even perhaps,extreme examples) J F Kennedy or Churchill or Kruschev. L & Mao are perhaps more radical than the latter 3 but whether "better" is debatable.

10:13 am  
Blogger Richard said...

"Rustico said...

Does anyone besides me ever stop and think, "How amazing it is that the universe exists, that our earth exists, that we are alive and aware that we are alive (even if only briefly), and aware of being alive?" We don't know where the universe came from. We don't know how life arose. There is no evidence for the existence of the being we call "God." But here we are. I have a garden (as Voltaire suggested) and I have chickens, and they provide us with very healthful eggs, and in a little while I will go tend to them. "

This is how (in general) I think much of the time. But there is also death (and sickness and the cost of sickness and the cost of living) to consider.

And life to be lived if you can afford your groceries week by week. I'm not being cynical to survive economically (I get less than NZ$200 a week) I have to be very careful what I buy. I can never go for trips. I have had gardens etc but getting my garden "in shape" at my age would be economically (and probably physically) crippling.

So the scenario, as I am hoping to get a pension in a year, (about NZ340 a week I think but an improvement); in Greece has its frightening aspects to me. This is not to say things are not good overall, or that such thoughts as yours are wrong. They are not. But keep them in perspective.

10:22 am  
Anonymous Rustico said...

Why does politics get so confusing? It could be a medical problem, a psychological problem, a difference in sexual expectations? Because we're hardwired like that...?

8:42 pm  
Anonymous Anonymous said...

What do you get after masturbating 20 hours a day for five days?

A weak end.

9:10 pm  
Anonymous Keri Hulme said...

Richard, you obviously dont recall the Muldoon years - when we truly had a fascist-leaning government.
I find your other comment quite silly.

8:11 pm  
Blogger Richard said...

Keri I respect you and your opinions.

I refuse to stop being silly.

Muldoon was a grumpy bastard but he was building NZ itself. He was basically on the right track.

But I cant vote for these hypocrites who started the rot in 1984 and are even thinking of increasing the pension age.

They don't know what they are doing.

National for me. Keep the status quo.

But who cares in any case? Where I am it always goes National so I wont even bother voting.

They're all bastards out there!

6:13 pm  
Anonymous Anonymous said...

richard is an anarchist at heart

7:15 pm  
Blogger Richard said...

" Anonymous said...

richard is an anarchist at heart

"

Possibly!

I cant seem to form any very fixed views of anything.

I keep changing my views and ideas...if I read something by Maps or I read a book on some subject I can be strongly persuaded by that or whatever and later in a different mood have almost the opposite opinion.

When I was a teenager just out of school I couldn't make up my mind what I wanted to do. I am still not sure at 63!

But I am sure the world will continue quite successfully (or at least it will continue in some way until,if it has an end, it ends...otherwise it will continue in some form forever..)) regardless of my existence (whether I live or die in the scheme of things in the Universe is not significant or indeed the scheme of politics!) or my opinions...

Hamish Dewe and others of his general ilk are however vital to the well being of the Universe...

But in way anarchist is what communism is (or one version of it as theorized)..that is there is no state, ultimately.

But I thing you have to go as much by how you feel about things as by some formula of "justice" or progress" so I don't like being in any group or having fixed ideas... I'm very fickle!

In Dr Wayne Dyer's book "Your Erroneous Zones" he points out how many people get into The Justice Trap...fondly believing in "fairness", and "justice" and "the triumph of right" or "goodness" and so on, but there are no such things in truth or in the world...

(A very great book that is.)

One cant ones own goals (and struggle somewhat toward some of htsoe good goals) and have ideals but its advisable to be prepared to be disillusioned...

Dr Phil on TV is very good, also, on human issues.

11:29 pm  

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