The rise and decline of union membership and power in my time (since the 1960s), has been the defining characteristic of a long career in the trade union and labour movement. From being ‘the wave of the future’ when I joined the T&GWU (it had nearly 2million members in the 1970s), union membership has gone downhill from the 1980s. As is well known, TUC membership has slumped from 13 to 6million and successive WERS surveys have tracked the contraction of collective bargaining from 80 to 20 per cent of workplaces in the private sector. Now, the previously resilient public sector is also under severe pressure.
This snappy title for a new book by former trade union leader, John Edmonds and former teacher/adviser on equality, Eva Tutchell, should influence the important current debate around that topic. As their focus is on the workplace, it should interest all active trade unionists. The book has a striking cover design showing the different roads to success of men and women in blue and red, and with unerring timing, Man-Made could catapult this issue to the forefront of the general election campaign.
Of course, all the political leaders – even the coalition parties are already paying lip-service to the ideal of gender equality in the higher echelons of companies, public bodies and generally in the economy and society. But by recording the stories of over 100 women, (including five current or former trade union leaders), who have broken through the usual barriers to success, Man-Made adds a new ingredient and urgency to the policy debate. Here is testimony which cannot be easily dismissed or brushed-aside by policy-makers in government, whoever forms the government after May 7th.
Man-Made’s recommendations are for a radical programme of positive action which would give extra advantages to women so as to balance the gender gap. It calls for a transformation of our current culture and significant changes in the law. These include:
- Better enforcement of equality legislation;
- Greater transparency in appointments and pay;
- Introduction of quotas, targets and in-house equality programmes;
- Introduction of a scheme offering work breaks
As you would expect from authors with considerable experience and practical knowledge of the system, their case is extremely well-argued and thoughtful. It is clearly pitched at opinion-formers and policy-makers across the political spectrum and will probably be all the more influential for that. Nonetheless, they are under no illusions but that some of their ideas, particularly quotas, will encounter serious opposition, depending on the political complexion of the next Parliament.
Although the quotas system will be the more controversial, perhaps their most interesting idea is the work breaks scheme, based as it is on ‘the explosion of longevity’ which is extending everybody’s working lives. They suggest that men and women should be given funded breaks of up to three years to enable them to share child-care responsibilities more equally, while they take the opportunity of bringing their academic and vocational skills up to date in the face of further technological change.
This may be ‘an idea whose time has come’ and trade unionists could have a special role in promoting it. Man-Made will be an essential tool to equip the proposed equality reps in making the case in every workplace.
Most of the media focus has been on the government’s ‘hugely successful’ sale of our 400+ year-old Royal Mail at a knockdown price to their chums in the City. Over at the postal workers’ union, they have been busy protecting the people most likely to lose their jobs or have their pay-and conditions affected after the looting is over. Perversely, these are the people who deliver the mail all over the country making it a profitable and the few ‘free share’ bonuses they received will not compensate them for when the rationalisations kick in. Nor will it profit ‘Joe Public’ – not even the small number of those with a spare £750 to buy 200+ shares – when the price of a stamp soars or the rural areas find the service disappearing.
So, I’m really proud of the job my union, the CWU, are doing. First, the heroic battle which the postal workers have fought against privatisation of the Post Office and Royal Mail over the last 20 years. No other union can match their record, since the first attempt was made to privatise the Post Office in 1994. The union, then led by Alan Johnson MP, launched the first and most truly impressive campaign, (‘Stand by Our Post’) in Parliament and in the country. So effective was it, that scores of Tory MPs in rural seats,forced Heseltine and Thatcher to back down. Sadly, it was a Labour government which next tried it in the 2000s. To his credit, Gordon Brown as PM, was persuaded by the unions, in the context of the ‘Warwick Agreement’ of 2005, to keep the business in the public sector. Since then the CWU also secured Labour Manifesto commitments which gave the Opposition a strong anti-privatisation policy in Parliament, albeit unable to stop it being privatised recently by the Conservative and Liberal Democrat Coalition.
It was to minimise the impact of the CWU’s overwhelming ballot of Royal Mail’s workforce – those with the greatest interest, next to the public - against privatisation, that the Ministers and Stock Exchange brought forward the sale before the ballot result. That remarkable expression of the entire workforce’s and most managers’ wishes would normally make the headlines as a weighty consideration. Instead, it was used by the Minister, Vincent Cable MP and the brokers handling the sale, as an excuse for their, at best, negligent haste, at worst, profiteering, decision to pitch the value of the company so low – £3.5bn instead of the £10bn valuation they were advised privately.
With such a powerful conflict between the interests of greed and working people, this government again demonstrated which side it is on and so ‘The Private Mail’ is a company like any other -
it can surely no longer legitimately call itself ‘Royal Mail’? But the union has not gone away. With its threat of industrial action now validated by such a huge majority, it forced the management to come back to the negotiating table with a much improved pay and conditions offer. The CWU negotiators are now in there seeking legally binding procedures to terms and conditions of employment in the private business – itself a novel demand in British industrial relations. The company offer is a very limited three year protection, but Dave Ward, their Deputy General Secretary and lead negotiator, has made it clear that they want to extend the range and scope of any deal. They are also seeking to protect the organisational integrity of the company, addressing potential dangers of franchising, outsourcing and fragmentation. They look like getting a good deal. Here is an effective union in action.
The union is negotiating a separate (also legally-binding) pensions deal. They have so far managed to protect the defined benefit (final salary) scheme – how many of us have managed that in the private sector these days? They got all members to send in a pensions protest on post-cards to convince the employer of employees’ concerns. The union is also mindful that 10% of the company’s shares have been kept back for employees. Despite their disappointment with losing the benefits and security of being a publicly-owned business, Dave Ward sees the union’s job now to fight for its members’ interests, regardless of who owns it. To this end, they are now exploring actively with expert advic, the potential of setting up a CWU Shares Trust to co-ordinate their members’ individual voting rights and collective influence. He thinks this could provide a crucial extra voice and influence for postal workers.
These negotiations are naturally taking some time, but anybody who believes the media image of this union as a bunch of mindless, strike-happy militants, rather than as an intelligent, imaginative and effective collective force, had better think again. Is this not the way forward for other unions also?
At the Labour Conference fringe in Brighton, there was a distinct change of mood. It wasn’t just Ed Miliband’s one hour ‘tour de force’ but also the warm reception given to traditional union figures such as Len McCluskey and Paul Kenny. So, the fringe called by the Institute of Employment Rights and others on Monday in the Grand at lunchtime on the topic,’Trade Unions:New rights; new freedoms’ , was packed with a star-studded cast of speakers, led by Unite’s Lennie.
This was also the launch of a ‘Manifesto for Collective Bargaining’ by the Institute and the Campaign for Trade Union Freedom of the Morning Star orientation. An accompanying booklet by the Institute of Employment Right’s veteran lawyer duo, Keith Ewing and John Hendy QC, made the case for the new ‘Manifesto’. It called on a future Labour government to reestablish a Ministry of Labour and an ACAS with teeth to promote sectoral collective bargaining. Employers would be obliged to participate as a precondition for securing public contracts. The resulting sectoral agreements would be legally binding and their terms part of each workers’ terms and conditions. It would be implemented gradually and flexibly and in industries without the infrastructure to support collective bargaining, Wage Councils would be encouraged.Their ‘Manifesto’ also calls for a much needed strengthening of the current statutory recognition procedures, lowering the required threshold to 10% membership and also of the right of individual workers to be accompanied by a union official.
All good moderate stuff (amazingly so from that camp!). Question is, will ‘Red Ed’ be prepared to take it onto Labour’s Manifesto? Judging by the revealing profile of his Policy Coordinator, Jon Cruddas MP (Tony Blair’s former union liaison man), in the Conference issue of ‘The House Magazine‘, nothing could be further from their minds. But you never know how things develop, particularly in the consultations due to commence over Lord Ray Collins’ final report, on how they plan to ‘reform’ the Labour-union link! Len McCluskey’s recent warm praise for Ed’s speech at the Jimmy Reid Memorial lecture in Glasgow and assurance of adequate UNITE funding for the general election in 2015, that we are talking compromise?
Which brings me back to the actual coalition government. We had the Conservative ‘envoy to the trade unions’, Lord Balfe, at the Unions 21 meeting, though their conference clearly wanted them to go even further with more restrictions on union industrial actions – their subsequent announcement of an ‘Inquiry’ into practices during the Grangemouth oil refinery dispute with Unite, shows their current form. By contrast, Balfe was quite emollient. He even praised three significant union-inspired gains of the previous Labour governments: the statutory Minimum Wage and Living Wage policy, the gains on gender equality and the Employment Tribunals/individual rights legislation. He indicated that they would want to keep ‘check-off’ for union subscriptions in the public sector, despite Tory Party pressures to ban it. It is not clear whether PM Cameron listens to his envoy, but the fact that he has now been elevated to the Lords, suggests that they are at least thinking about unions again not as ‘the Enemy Within’ . Perhaps we need an Envoy to the Coalition government, as the Lib Dem leaders did not seem too happy about this further lurch against union actions?
Equally significantly, perhaps, was the Labour Leader’s post-Conference highly effective stand up to The Mail, over their calumny of his Marxist dad’s patriotism. This outcome suggests to me that we are beginning to move beyond the hegemony exercised by Thatcher and the right-wing media up to recently. This could be most important for a bolder shaping of future Labour policy towards unions as collective bodies with legitimate rights.
Ed Miliband’s superb performance at the Labour Conference in Brighton, has changed a few things. ’Labour’s New Energy’ (‘Guardian’), ’Decisive shift to the Left’ (The Times’),were the typical commentators’ take on it. More significantly, all the trade union leaders, especially Len McLuskey, (the darling of delegates at this conference), were ‘over the moon’ with the Labour leader’s list of concrete pledges and the general tenor of his virtuoso hour long performance without a note.
They even drew comfort from Ed’s very brief mention of their other main concern, his plans for ‘changing our politics’ viz., ‘party reform’ of the union political levy. Yet there was no hint that he is abandoning this attempt to change what he clearly sees as an outmoded form of the link. His contrast of ‘hearing the individual voices of people from call centre workers to construction workers’, with the hearing the collective voices of union leaders, could not have been more pointed. Yet there was still no detail about how he proposes to do it. Most union and many party activists remain extremely sceptical about how his ‘mass membership’ of political-levy payers could be realised.
Yet his new status as a substantial Labour Leader in the more conventional social democratic tradition, means that many will suspend judgement until we see more flesh on the bones of Lord Ray Collin’s surprisingly slim interim report to this conference. In it he stated that ‘Ed does not want this individual relationship with trade union membership to damage the collective relationship and the institutional links between the party and the union organisations. Ed wants to mend - not end – the link.’ But, as unions say, ‘the devil is in the detail’.
The Collin’s statement also said, ‘we do not believe there is any need to change the laws around the right of trade unions to hold political funds’. The Labour Opposition may not intend to go there, but the government party leaders, especially Clegg, seem intent on it. My fear would be that they would do that ‘dirty work’ whilst in government. At the Unions 21 conference fringe on ‘Thatcherism’, the Tory ‘envoy’ to the union movement, [now] Lord Balfe, said just that.
I suspect, therefore, that the genie is now well and truly ‘out of the bottle’ and will never go back to where it was. It seems that the Labour leadership chose their ‘Falkirk moment’ to challenge what they saw as undue mega-union political power, in their Party policy and structures. Their concerns seem also to have arisen in the context of their discussions with the Liberal Democrats, and the unions fear some unprincipled deal for a Lab-Lib Dem coalition.
There will therefore be some real heart searching from now until the proposed special Spring conference and the Collins’ report will be the subject of close attention.
The History & Policy Trade Union Forum has been looking at the whole relationship of the unions with all the parties historically in a series of seminars involving senior union figures (such as Billy Hayes of the CWU). Each one has been written up on our website (http://www.bit.ly/tuforum). In November, we will be pulling the threads together and drawing some conclusions as to the future policy options for unions and the parties, and this will be of interest as a historical context of this whole debate.
How good it is to see the new TUC General Secretary, Frances, shaping up so well as Leader of Britain’s unions? We badly need that broad-based leadership which has been the distinctive contribution of that body.
Founded in 1868 to coordinate the parliamentary lobbying of the then mainly craft unions, it did much to persuade both Liberal and Conservative governments to reform the far worse anti-union laws of those days. This led to what a later General Secretary,Walter Citrine, described as our Charter of Trade Union Rights of the 1870s – full legal status without incorporation; immunity from prosecution and attack on union funds and many more protections.
Still the emerging general unions preferred to retain total autonomy in pursuing their sectional trade interests until 1921, when they agreed to give the TUC General Council more powers to coordinate the industrial strength of individual unions. After the over-ambitious but well-meaning use of those powers in the ten day General Strike of 1926, it was the General Council under Walter Citrine as General Secretary, together with key union leaders, such as Ernest Bevin of the T&GWU, who then led the entire Labour Movement out of the Great Depression. This achieved impressive results with the restoration of union membership, extension of union recognition and government action against low pay throughout the 1930s. Together with the Labour leadership of Attlee, Morrison and Nye Beavan, the TUC laid the ground in policy terms for the most radical advances of the 1945-51 Labour government.
For a couple of decades afterwards, our generation reaped the fruits of the growing status of workers and trade unions in society. But seduced (perhaps) by the understandable materialistic and (less so) individualistic urges of the ’60s and ’70s, the unions fell back on following those membership urges, rather than exerting any leadership moderation.
This was encouraged by the then influential CPGB and the Left generally in unions – I know, I was part of it. That is not to say that the Right were paragons of wise counsel either. It was often a case of factional contests between the ‘Ins and the Outs’ for the plumbs of union office, rather than the wider interests of the membership. After George Woodcock’s thoughtful but over-cerebral stint, the TUC fell into line and ‘led’ our rear-guard action against (modest) union and industrial relations reform. We threw out ‘In Place of Strife’ and ‘Killed the Bill’ and with it two governments who, all things considered, were not anti-union and a hell of a lot better to deal with than what was to come with Thatcher. The TUC froze, immobilised by our divisions in the build up to the Miners’ syndicalist leadership’s attempt to get the waves to go back. After a time, John [Lord] Monks as General Secretary again ventured to the front with a serious approach to regaining the lost ground of the 1980s and ’90s through the EU Social Chapter and close working with the new Labour Government of 1997. Alas, this time it was the New Labour leadership which moved the goalposts with its distrust of all collective union effort and left him in the lurch.
So, here we are today, with the prospect of another Tory or right-wing Coalition government now a very real prospect in 2015. Admittedly, the latest self-inflicted wound has come from a gauche Labour leadership move over the ‘opt in’ option, on the pretext of bogus allegations in Falkirk. This is the wrong way to ‘reform’ the last collective power of unions (or more correctly of union General Secretaries or Executives of the largest unions) – the political levy. So, to get out of this jam without bringing down a quite good, if poorly advised, Labour leader, we need some stateswoman-like leadership. If the two wings of the movement can get their heads together over this one, it could lead on to better relationships generally.
Enter Frances O’ Grady. In addition to his recent committment to prioritise a statutory National Living Wage, with effective enforcement powers, Miliband should commit to restoring the legitimacy of responsible collective union influence in Labour and government counsels. Review the trade union laws with a view to repealing those which are one-sided and unjustifiably restrictive. We have lived with some of them – individual balloting requirement, for example, which no one now wants to abolish. End the war on the trade unions, in return for rule changes which commit all unions to again coordinate a considered approach through the TUC on political and other such matters.
Although you can overdo the ‘mea culpa’ style in politics, it is refreshing to get a politician who can admit it when he or his party get’s it wrong. It is one of Ed Miliband’s attractive features.
Now he has done it again, accepting blame for the last Labour administration’s failure to properly address falling wages. In what must be his first concrete policy announcement ahead of the next general election. At a Scottish Labour gathering in Edinburgh recently, he promised to make it a priority for the next Labour government to introduce a national living wage. (The Guardian, 24th August 2013). Wow, that is shouting louder!
No doubt he also had an eye on union audiences for the upcoming TUC and Labour Conferences where he could be in ‘hot water’ over his proposals to change the political levy system. However he or Lord Ray Collins (an old colleague from our young T&GWU days), dress it up, it seems they mean to change to an ‘opt in’ on an individual system of union contriutions, as opposed to our favoured collective basis.
Whatever is behind this new Living Wage’ proposal, good thinking. The Labour Party could be onto a winner with this upgrade of their last administration’s hugely popular Minimum Wage legislation. Of course, the bad employers’ lobby and most of the right wing media will cry ‘millions of jobs would be lost’, but public opinion is on his side here, I suspect. Ed is rightly focusing on the big squeeze on family finances under this uncaring coalition government. In Brent where I’m a councillor, we’ve adopted a Q Living Wage policy and people really think its the right way to go.
In a recent blog, I also highlighted HSBC Director of Research, Stephen King’s new book warning ‘of the dangers of such a lengthy wage freeze as workers in the western economies have recently endured. He described it as ‘the greatest redistribution of income to the asset and cash rich since the nineteenth century.’
The real issue is how a real living wage could be brought about in all the private sector workplaces, even if all the political parties signed up? Already with the much lower statutory minimum wage, new rules are having to be brought to ‘name and shame’ those numerous ‘bucket-shop’ employers who flout the law, but don’t get taken to court. There will also be practical issues of implementation, as we have on the Council, in some pockets of extreme low pay eg cleaning contracts. But these can be addressed over time with suitable mechanisms, proper consultation and representation of the workers concerned.
If Labour wills this end, they must also ‘will the means’ – an institutional framework which can be enforced by workplace organisations viz., trade unions. Unions must respond to this laudable initiative by coming up with workable proposals of their own to assist Labour in fleshing out such a framework. They should start working on the sectors where they recruit in harmony, rather than in rivalry for members. Don’t let’s leave it to the policy wonks or HR experts who surround the Labour Leader, who are sure to come up with a flawed mechanism, the weaknesses of which rogue employers and their ‘clever’ lawyers will already be working on.
Wage regulation is not rocket science, as it has been done before on a national scale, especially in the 1930s – last time the State was really concerned that ‘squeezed’ and poverty wages were a matter of serious social concern. Wages Councils, national agreements backed up by legislation and arbitration systems are well tried methods in Britain.. The initiatives taken then led to a major growth in trade union membership, union recognition and collective bargaining.
Here’s a real issue for unions and Labour to ‘get their teeth into’, rather than having barren wrangles about how the dwindling members’ pence of the political levy should be collected. By all means try new ways of engaging the millions of union members in politics, to ensure that the union voice is properly heard and representative of their views. But the real test of modern Labour’s payback for union funding, is whether they deliver on this new Living Wage commitment.
Unions21′s event: Fair Pay: The Fair Work Commission Debate – is at TUC Congress Monday 9th September. Read more here: http://www.unions21.org.uk/events/
Boy, does Alan Johnson, my former CWU General Secretary, have a tale to tell. Well known as one of the few genuinely working class MPs and former senior Ministers in Westminster, it was less expected that he would craft such an intimate but compelling account of his incredibly deprived childhood. It also evokes an amazing picture of west London working class life in the 1950s and ’60s.
‘This Boy’ (the title is from a Beatle’s number), is the genuine article. With humour, but not a little bitterness, he brilliantly describes how his Liverpool-Irish mum, Lily, held it all together for him and his elder sister,Linda, in the post-war slum-conditions of the Ladbroke Grove – Notting Hill (with its race riots in 1959) area. His ‘awol’ pub musician/gambler/womaniser dad, Steve, buzzed in and out (then out altogether). That’s how Alan saw it from age 8 to 14, though of course, memoirs are by definition, selective. To make matters worse, his mum died from a heart condition in 1964, leaving 16 year old sister Linda to fend for both of them, keeping them out of ‘care’. He was still at the grammar school to which his aspirant mum had sent him (this bright boy was one of the few then who passed his 11+ exams). Alan was also fortunate in being a teenager in ‘Swinging London’ of the 1960s, where he had access to all the best gigs and his musical talents blossomed playing in two bands. His other love, QPR, which he follows still, shows his sentimental side.
Alan’s account of his early life is so compelling that they are probably casting around for the actors to play the parts and characters which Alan has so sharply drawn in ‘loving’ detail. ‘This Boy’ justly reached number 3 in the hardcover best sellers lists. At £16.99, you don’t have to wait for the paperback – treat yourself to a good, easy, holiday read.
But I am looking forward to Alan’s next venture into print, taking the story on from the late ’60s, when he married aged 18, started as a ‘postie’ in Battersea and his involvement in the postal union (then the UPW). I want to know more about how his career took off on account of the major opportunities he got as a union official, eventually to become General Secretary of the UCW and the merged postal and telecoms CWU. I particularly want to hear the inside story of how he was talent-spotted by Tony Blair and piloted into Hull West (no NEC ‘Falkirk’ Inquiries then!). We in the CWU were sad when Alan was lured away by this rival Group’s blandishments, whose fee and status we couldn’t match.
Nonetheless, we wished him well and knew it would not be long before he went higher. They saw him as the ‘modernising union’ leader who best fitted their ‘project’ for ‘New Labour’ . With his anti-Post Office privatisation credentials, he helped them swing the abandonment of Clause IV at union and Labour conferences, and thus established Blair’s position as Labour leader. The rest is history. No wonder that he stayed with this fellow guitarist’s Group.
You don’t read many memoirs or biographies of union officials these days. This is very sad, as those officials who have recently retired, were involved in some of the most interesting times of the Thatcher era. This is partly a reflection of the fact that publishers are not interested in union matters. As a former Home Secretary and television pundit, Alan today has all the advantages. If only half of his childhood deprivations happened, good luck to him. But many of our union leaders (with as good life stories) are not without the contacts, resources and opportunities either to encourage publishers to take on able union writers. What ‘This Boy’ shows is that you have to have a story to tell (even if it isn’t your own story, but one you know well), and tell it well.
I was attracted to a lecture at the LSE last month by this provocative title. For a senior bank official to publish such a book, is somewhat more serious than the infamous note with the same sentiment, left by Liam Byrne as he quit the Treasury in 2010! This is from Stephen D. King, HSBC’s Group Chief Economist and the bank’s Global Head of Economics and Asset Allocation Research. He was launching it at the LSE to an audience of economic students, dons and public for nearly two hours including questions. So, we thought, he must know more than the rest of us about what’s ‘up ahead’! We weren’t disappointed.
King’s underlying analysis is that the current stagnation of Western economies threatens to reach crisis proportions in the not-so-distant future. He argued that the phenomenal growth rates of post-war decades will not return and that even the low single digit average growth rate since 2003, looks optimistic to expect in the future. In his view, this huge reduction in economic activity is unlikely to be reversed even by high levels of public spending. He questioned whether even the continuation of ‘Quantitative Easing’ (i.e. money printing) policies of US, UK and other central banks to avoid a 1930s-style slump, would succeed beyond their initial success. The US Treasury seems to have come to the same conclusion, to the consternation of the stock markets.
What was interesting also was his critique of orthodox economic theory. He argued that the absence of historical perspective in most economists’ university training, has made them ill-equipped to learn the lessons of past crises. He therefore advocate much greater focus on economic history, than the current syllabuses’ reliance on the mathematical models. . They had so failed to spot the signs of the present financial crisis. Remember the Queen’s very same question to an assembly of top economists! I very much agree with this. Interestingly, no one in that audience of economics students or dons, argued otherwise.
But his message was much tougher for the establishment generally. Not since John Maynard Keynes, in the 1930s, has such a senior UK economist warned of the dangers of such a lengthy wage freeze as workers in the western economies have recently endured. He described it as the greatest redistribution of income to the asset and cash rich since the nineteenth century. The implication was the wealthy classes and employers must accept more taxation and allow more wage increases, if austerity policies are to continue.
To ram home this point, he gave two powerful historical parallels – the mishandling of the economy which gave rise to the French Revolution and the disastrous Snowden budget and clinging to the Gold Standard of 1931, which almost caused an uprising in Britain. The French case needs little illumination – with the vivid images of tumbrils it conjures ! King argues that the true circumstances of the Snowden budget is less well understood today, and that even Ed Balls, the Shadow Chancellor, who argued, ‘Don’t Repeat the 1930s folly’, in his critique of the government’s policies in 2010, has misunderstood the true lessons!
Philip Snowden (1864-1937), was the Chancellor of the Exchequer in Ramsay MacDonald’s short-lived Labour government of 1929-31. Despite the huge mass unemployment of the Great Depression (3million plus in Britain in 1931), he clung to the financial orthodoxy of the Gold Standard. This had overvalued sterling and made Britain’s exports uncompetitive (especially against cheap German coal, causing the General Strike in 1926). Snowden was attempting to reassure the financial markets and foreign creditors that Britain would not penalise them by devaluing the £, which was then a global currency. Instead of trying alternative policies (such as raising trade tariffs), he opted for the deepest austerity policies of a Committee on National Expenditure (20% cuts in unemployment benefit at a time of 20% rise in prices and 30% drop in GDP). ‘Snowden forced Britain onto a diet of cod liver oil and leeches.’ ['When the Money Runs Out'p102].
For King, that was a stupid policy, which austerity governments today, are repeating all over Europe. It showed the ‘political impossibility of maintaining a monetary arrangement that persistently imposed costs on British citizens even as the government attempted to maintain the UK’s credibility in the eyes of international financiers.’ [p102]
This attack on the benefits of the vast out of work classes caused a split in the Labour Cabinet’, as senior Ministers, lobbied by the TUC and the unions, refused to go along. However, MacDonald and Snowden formed a ‘National’ Government with the Conservatives and some Liberals and their ill-fated budget was implemented in September 1931. Following the government’s lead, the Navy cut the pay of the ratings by 25%, triggering a mutiny by the sailors – the Invergordon Mutiny. As King notes, ‘The stock market crashed, foreign investors headed for the exit and on 20th September, sterling left the Gold Standard’. [p99] Ironically, this reversal of orthodoxy policy proved the catalyst for economic recovery in the mid ’30s (shades of the 1990s forced exit from the EMS!). It relieved the threat of much wider social discontent, at a time when the appeal of German and Italian fascism was a serious worry in Britain.
King’s point (and though radical, he is no ‘New Dealer’ advocating Keynesian stimuli policies, but a fairly cautious banker), is that there are lessons from past periods of monetary and politically-entwined experiences, which should inform today’s debates. Although he does not spell it out, he clearly implies that unless British governments and wealthy classes are seen to share the burden of low economic growth, they might again face their ‘Invergordon moment’.
Whether he is right about that future for society under western capitalism (which he described as ‘the best of bad alternatives’), here is something to ponder for our current leading politicians, media commentators and employers. For a start, they might dip into ‘When the Money Runs Out’.
The funding of political parties has naturally been a hugely contentious history for centuries – from the days of the pre-reformed Parliaments with their tiny franchises and ‘rotten boroughs’ in the gift of the aristocracy and nobility. Yet the funding of the reformed Parliament parties after 1832, Whig/Liberal and Conservative\Unionist by the railway companies and other industrial and newspaper barons, rarely attracted great attention. It seems that it is only since the trade unions came into the political arena from the late 19th century, that their funding of politicians and the Labour Party, has again aroused concern.
In 1907 a Walthamstow Liberal trade unionist started a legal action against his union, the Amalgamated Society of Railway Servant’s decision to levy a compulsory contribution (1shilling a year) to the union’s political fund. What made it so controversial for Osborne, was that the proceeds were being donated to the infant Labour Party, in pursuance of the union’s political objectives, which he regarded as extreme socialistic. He had the sympathy of the entire establishment, especially the judiciary, and in a famous 1909 ‘Osborne Judgement’, the House of Lords held that the levy was unlawful. Read More…