The Extreme Centre

A Warning

Tariq Ali

• Publisher: Verso
• Year: 2015
• Print ISBN: 9781784782627
• eBook ISBN: 9781784782689
• Topic: Politics & International Relations
• Subtopic: British History
• Index: Politics & International Relations

What is the point of elections? The result is always the same: a victory for the Extreme Centre. Since 1989, politics has become a contest to see who can best serve the needs of the market, a competition now fringed by unstable populist movements. The same catastrophe has taken place in the US, Britain, Continental Europe and Australia.

In this urgent and wide-ranging case for the prosecution, Tariq Ali looks at the people and the events that have informed this moment of political suicide: corruption in Westminster; the failures of the EU and NATO; the soft power of the American Empire that dominates the world stage uncontested.

Despite this inertia, Ali goes in search of alternative futures, finding promise in the Bolivarian revolutions of Latin America and at the edges of Europe. Emerging parties in Scotland, Greece and Spain, formed out of the 2008 crisis, are offering new hope for democracy.

1

English Questions

As of 2015, the UK is a country without an opposition. Westminster is in the grip of an extreme centre, a trilateral monolith, made up of the Conservative–Liberal Democrat coalition plus Labour: yes to austerity, yes to imperial wars, yes to a failing EU, yes to increased security measures, and yes to shoring up the broken model of neoliberalism.

Its leaders are a mediocre bunch: Labour’s Ed Miliband, a jittery and indecisive figure, over-dependent on focus groups and spin, presiding over a parliamentary party (including his shadow chancellor) that remains solidly Thatcherite in inspiration; David Cameron, the Conservative prime minister, a PR confection, haughty towards the bulk of his own people while repulsively servile to Washington, Riyadh and Beijing. The Liberal Democrat Nick Clegg barely warrants a mention. His party is likely to suffer in the 2015 general election, and we might soon be deprived of his presence altogether.

Flanked on the right by the lowest-common-denominator politics of Nigel Farage and a Ukip on the rise, this panic-ridden extreme centre tries to pander to this new right as best it can. Euro-immigration is becoming an English obsession, even though this country was at the forefront of carrying out Washington’s orders to expand the EU rapidly so as to deprive it of any social or political coherence. This introduces a point rarely made by mainstream politicians or media toadies: Ukip wants independence from the EU, but appears perfectly happy with Britain remaining a vassal of the United States. Ironically, it is precisely this status that will make it difficult for any segment of the extreme centre to execute a wholesale withdrawal from Europe. Washington wants its Trojan mule in place.

Economically, the country is far from the visions of recovery and renewal promised by the Coalition and its media retinue. If anything, conditions are getting worse for the majority, while markets remain volatile. Underlying this trend is a continuing engrossment of wealth and privileges enjoyed by the rich.¹ As pointed out by countless observers, while the earnings of the average employed person are either static or declining, the salaries and bonus options of the 1 per cent continue to rise.

The origins of the new politics are firmly rooted in Thatcher’s response to Britain’s decline. Unemployment was ruthlessly held above three million for ten years, enabling the Conservatives to push through a programme of social re-engineering – deploying state resources to crush the unions and initiate the privatization of public utilities and housing, in hopes of creating a nation of ‘property-owners and shareholders’ – that transformed the country.² The defence industry was ring-fenced while the rest of manufacturing was handed a collective death warrant. The defeat of the miners’ strike obliterated any possibility of resistance by the trade union leaders and the rank and file. The triumph of finance capital was now complete. The decline of large parts of the country continued apace, and in turn, the country became increasingly restive.

How would the people react? After eighteen years of Conservative rule, they voted Labour and Tony Blair into office with a huge parliamentary majority, achieved by virtue of an antiquated and blatantly unrepresentative first-past-the-post system: 13.5 million, against 9.6 million for the Conservatives and 5.2 million for the Liberal Democrats. Blair had fought a slick campaign that made few promises, but traditional Labour supporters nodded their heads in appreciation and thought him wise. The key was to return Labour to power after the locust years. Many assumed that once in office Labour would return to some form of moderate social democracy, a little bit of Roy Hattersley, perhaps.

Few would have believed that Labour had become a party of war and finance capital. Yet New Labour was, as it turned out, little more than a continuation of Thatcherism by the same means. As if to stress the point, both Blair and Brown, on becoming prime minister, invited the old crone in to Number 10 for a whisky and a quick photo-op. This was not opportunism; their admiration for her was genuine.

Blair’s position as leader of the Labour Party was not preordained. It was the result of John Smith’s untimely death. Ideologically, Smith was a staunch European social democrat whose instinctive tendency would have been to establish close relations with Berlin and Paris. By contrast Blair styled himself as an English version of the Clinton who had recently shifted the US Democrats to the right, abandoning any pretence of a New Deal. The scale of Labour’s electoral victory in the May 1997 general election surprised its leaders. They had fought a banal campaign, strong on presentation, weak on politics. It stressed continuity with the old regime rather than any serious change. Blair’s presidential demeanour smacked of Bonapartism. His image was used to reassure Middle England voters that he was not too different from the Tories who had governed Britain since 1979, and that he would be a friend of big business.

It was publicly stated by Blair and his spin doctors that the trade unions would be kept at arm’s length. It was also hinted that Blair and his group would like to detach the Labour Party from the trade unions altogether. A modern, democratic party had no time for old-fashioned conflicts. Ideally, Blair wanted a coalition government with the Liberal Democrats to lay the basis for a new centrist party that could dominate politics for the next fifty years. The size of Labour’s electoral majority made any such desire utopian. Instead Blair and his colleagues transformed the Labour Party beyond recognition. Its slow collapse today will resuscitate the project, if the Lib Dems don’t lose most of their seats.

During a lunch for big business at London’s Savoy Hotel on 13 May 1996, Peter Mandelson, a close ally of Blair, stated that he favoured ‘healthy profits’ for companies and was not unduly bothered by the fact that this would ‘inevitably lead to inequalities in incomes’. After two years of Blair, the gap between executive salaries and the average wage was the largest in Europe. This was widely interpreted as a pledge that Britain was safe for foreign investors. As a result the British economy was soon dominated by transnationals. Today, this market is five times greater than the rest of Western Europe and three times that of the United States.

Blair’s ideologues were so convinced that victory had only been won because they had ditched a traditional social democratic programme that they ignored the reality of Britain under the Conservatives. The Blairites wanted to believe that the electorate punished their predecessors for their misdemeanours rather than their crimes. The decline in education and the health service, the sale of the railways and the water authorities, had not been popular. The sale of public housing to it occupants was a key plank in Thatcherite policies. New Labour had decided it was popular and promised to leave it unchanged.

Individual greed was beginning to turn to anger as people realized that they had been cheated (many had believed that Blair needed to make concessions in order to win and that once victory had been achieved it would be back to traditional social democracy). Nothing was being done to alleviate their suffering. New Labour enthusiasts do not like to be reminded that between 1990 and 1996, a million people lost their homes through repossession by the mortgage companies, while 390,000 homes, once publicly owned, were seized by those companies. Come 2009 almost one million properties were estimated to be in ‘negative equity’: the homeowners had paid too much for them in the first instance and could not get their money back.

Thatcher had resolved to make Britain a nation of small businesses. This was the much vaunted ‘popular capitalism’. Yet by 1997, the year of Labour’s victory, personal bankruptcies had ‘stabilized’ at 22,000 a year; 30,000 companies had become insolvent between 1990 and 1997. The ‘flexible labour market’ so beloved by Thatcher, Blair, and the transnationals had, in reality, made unemployment a mainstream experience. In December 1997, it was estimated that one in five men and one in eight women had suffered at least one extended spell of joblessness in their adult lives. It is this insecurity that modern capitalism, which lives for the short term, values so greatly.

If one studies the actual performance of the US economy during the same period, one sees that the model to which Blair aspired was little short of disastrous. Assuming that productivity growth – the increase in output per hour – is the most useful single indicator to determine economic health and the key to increased wealth and a growth in wages, then the situation is bleak. Over the last twenty-five years, US productivity has grown by less than half of its average rate of increase during the entire previous century. It stands at a little over 1 per cent per annum, compared to 2.2 per cent between 1890 and 1973. This means that the output available to distribute to workers – assuming that the distribution didn’t change – grew half as fast as before.

On the level of wages, the picture is much worse. The distribution of income between rich and poor has polarized sharply. Since 1973, there has been a wholesale stagnation of wages. Real wages have been flat for the last quarter of a century. Today they are at approximately the same level as in 1968. By contrast, wages grew at an average annual rate of at least 2 per cent (often faster) during every single decade between 1890 and 1970, with no exceptions, not even the decade of the Depression – the thirties.

Nothing changed under Clinton. In 1998, the wages of the bottom 80 per cent of the labour force were lower than they had been in 1989, and significantly lower than in 1979. Simultaneously, the United States is the only major capitalist country where workers have actually had to increase the average number of hours they work each year, to above 2,000. This means that US workers labour more each year than the workers of any other Western country. They work 10 to 20 per cent more than Western European workers. Even the Japanese, usually top of the league in terms of working hours, sharply reduced this during the 1990s and are now working less on average than North Americans.

Inequality, too, increased in the US by leaps and bounds throughout the nineties. The ratio of executive pay to workers’ wages was 42:1 in 1980; by 1990 it had doubled to 85:1, and by 1997 it had quadrupled to 326:1. In 1980, the richest 1 per cent of the population owned 20.5 per cent of the wealth. This rose to 31.9 per cent in 1989, and reached 40.1 per cent in 1997. The value of stocks tripled in real terms between 1990 and 1998, an extraordinary windfall for those who were already rich. By 2000 the top 1 per cent netted 42.5 per cent and the richest 10 per cent netted 85.8 per cent of the national wealth, leaving the bottom 80 per cent with peanuts.

This is the famous trickle-down economics of neoliberal fantasists. When we are told the US economy is flourishing, this is true, but only for the well-off. In the United States, 25 per cent of all children live in poverty. This number is double that of any other advanced capitalist economy, except one – Britain. Where elderly poverty is concerned, the United States scores 20 per cent, but in this field, at least, it has been overtaken by its British emulators: in England, 24 per cent of old people now live in poverty.

The cold-blooded decision taken by New Labour’s leaders and house academics to discard the very concepts of equality and social justice, and turn their backs on redistributive policies, marked a sharp break with traditional social democracy. Harold Wilson, Richard Crossman, Anthony Crosland and Barbara Castle, not to mention Clement Attlee and Herbert Morrison, were recast as ‘loony lefties’ for insisting that the state had an important role to play in regulating capitalism.

The first three decisions made by New Labour were highly symbolic, designed to show the City of London that this was not an old-style Labour regime. They had made their peace with free market values: the Bank of England would be detached from government control and given full authority to determine monetary policy.

A second determining act on entering office was to cut eleven pounds a week in welfare benefits to single mothers. The savings for the state were minimal. The aim was ideological: a show of contempt for the ‘weaknesses’ of the old welfare state, and an assertion of ‘family values’.

The third measure was to charge tuition fees to all university students. This was a proposal that had been rejected more than once by the preceding Conservative government, on the grounds that it was unfair and discriminated against students from poor families. New Labour apologists were quick to point out that students in real need would not be charged, but the overall effect has been to discourage working-class children from aspiring to higher education.

The culture of New Labour was not simply to maintain the status quo, but to defend it as an achievement of the free market and insist that there was no conflict between corporate interests and those of working people. Almost overnight, people like the former deputy leader of the Labour Party, Roy Hattersley – a right-wing social democrat at the best of times – began to sound positively radical; yet all he was doing in his regular Guardian column was to reiterate traditional Labour commitments to a moderate degree of social justice.

One of the last big measures of the preceding Conservative government had been to privatize the railways, despite the fact that only 15 per cent of the population supported such a measure. At the 1993 Labour Party Conference, John Prescott, later to be deputy prime minister and in charge of transport, told delegates: ‘Let me make it crystal clear that any privatization of the railway system that does take place will, on the arrival of a Labour Government, be quickly and effectively dealt with … and be returned to public ownership.’

A year later, at the 1994 Labour Party Conference, Frank Dobson vowed on behalf of the leadership: ‘Let me give this pledge not just to this Conference but to the people of Britain. The next Labour Government will bring the railway system back into public ownership.’

By 1996, with Blair firmly in control, the crystal clearness had vanished completely. Now, New Labour pledged to create ‘a modern integrated transport system, built in partnership between public and private finance’. The results were less than successful. On 1 July 1999, the Economist – a staunchly pro-capitalist weekly – published an article headed ‘The Rail Billionaires’ and subheaded: ‘The privatization of British Rail has proved a disastrous failure. Without big changes, things are going to get worse.’ The magazine provided an example:

Indeed, until last year, some of Railtrack’s suppliers decided, in effect, which parts of the track needed renewal. Naturally, they appeared concerned less with passenger safety than with their own profits. Because they are paid by the mile, they have understandably tended to choose sections that are easy to renew rather than those that involve the most work.

In October 1999, a rail crash occurred at Paddington Station in which dozens of people lost their lives. John Prescott, then deputy prime minister, immediately went on television to insist that the accident had nothing to do with privatization. He looked shifty and uneasy as he recited the New Labour platitudes. In fact, the group of directors earning a fortune in dividends had decided that £700 million was too much to invest in ATP, the safety system that would have prevented the Paddington crash.

The public was outraged. Every opinion poll showed a large majority of citizens (between 65 and 85 per cent) in favour of renationalizing the railways. New Labour, normally very keen on focus groups and other slightly bogus marketing techniques, was not prepared to listen. In March...

Table of contents

• Cover Page
• Halftitle Page
• Title Page
• Copyright Page
• Contents
• Preface to the New Edition
• Introduction
• 1. English Questions
• 2. Scottish Answers
• 3. The Corbyn Factor
• 4. Euroland in Trouble
• 5. Natopolis
• 6. The Starship Enterprise
• 7. Fear, Misery, Power and the Forty-Fifth US President
• 8. What’s Left in France?
• 9. Germany: Heartland of the Centre
• Afterword: Alternatives
• Notes
• Index