141945: Owing America

More like enslavement 06

IF YOU WANT TO REBUILD BRITAIN, READ ON

JOURNAL OF THE COMMUNIST PARTY

Falling into the talons of vultures 12

WORKERSwww.workers.org.uk DECEMBER 2013 £1

EXPOSED: THE EU CONTROLOVER BRITAIN’S TRANSPORT

WORKERS

News 03

Features 06

Contents – December 2013Probation officers strike as prison privatisation threatens to run riot, p3;Successful strike day for universities staff, p4; Government attemptsdiversion over GP opening hours, p5

Rail unions resist EU plans to hand rail over to the privateers, p6; They call it freemovement of labour, but it’s actually the enslavement of labour, p8; Smash andgrab as US vulture funds sink their talons into the Co-op Bank, p12

HistoricNotes 14More than a loan – the Anglo-US Agreement of 1945, p14

Cover image Andrew Wiard/www.wiard.co.uk

WORKERS is published by the Communist Party of Britain (Marxist-Leninist)

78 Seymour Avenue, London N17 9EB. www.workers.org.ukISSN 0266-8580 Issue 175, December 2013

Jilted by the European Commission

EVERYONE knows the big six energy companiesare profiting at the expense of their customers.But that is what they are supposed to do.Indeed, it is what they are legally obliged to do.

The higher the CEOs of the big six raiseenergy prices, the higher the companies’ profits.The higher their profits, the higher the CEOs’performance-related bonuses. So running anenergy company is basically a licence to print

your own bonuses.But what can we expect? When we allow the

privatised energy companies to serve their CEOs’greed first, at our expense, then we shouldn’t besurprised that we are being ripped off.

We don’t want energy companies to profit atthe expense of their customers. We don’t want aprofit system. We want a different, plannedeconomic system, which doesn’t put profit first.■

THE TUC and trade union love affair with theEuropean Union began in the dark days ofThatcher, when then-President of the EuropeanCommission Jacques Delors addressed Congressand said Europe would save them fromThatcherism. It was always a false boast. Noweven the boasting has stopped.

Under the REFIT (“Regulatory Fitness andPerformance”) proposals the Commission willreview EU legislation on workers’ rights. Inlanguage familiar to British ears it talks of“easing the burden” on business and of makingEU law “lighter and simpler”.

It’s doing this by “streamlining” directiveson information and consultation rights incollective redundancies and business transfers(in particular, the transfer directive known as

TUPE), despite a recent review concluding theywere “fit for purpose”. Nothing that could evenslightly get in the way of capital is to remain.

Plans to extend these rights to smallercompanies and the public sector have beenshelved, permanently. Nor will the Commissionbe going ahead with legislation on illness orinjuries associated with screen displays,tobacco smoke or carcinogens. And there will beno legislation on health and safety inhairdressing which had been agreed betweenunions and employers.

The European Trade Union Confederationsays it only accepted the internal market on theproviso that there would be strong “social”rules. More fool it, and more fool anyone whobelieves in the EU. ■

‘‘’’

Sharks will be sharks

CRIMEGREECETRADESAFETYUNIVERSITIESUSGP SURGERIESENERGYEUROBRIEFSWHAT’S ON

DECEMBER 2013 NEWS DIGEST WORKERS 3

Probation officers strike

RebuildingBritain

Probation officers strike General strike Deficit rises Half of sites breaking law Industrial action bites War on the world Opening hours diversion Ignoring shale evidence The latest from Brussels Coming soon

If you have news from your industry, trade or profession wewant to hear from you. Call us on 020 8801 9543 or emailrebuilding@workers.org.uk

TRADEDeficit rises

THE NATIONAL Association of Probation Officers, NAPO, struck on 5/6 Novemberagainst government proposals to privatise probation and rehabilitation of offenders.Probation is seen as a business worth £820 million per year, with over 233,000 people onprobation or parole. Electronic tagging of offenders is a £1 billion market despite G4S andSerco being embroiled in allegations of tagging the dead or overcharging.

Britain has 14 privately run prisons. It was in fact the first country in Europe to open aprivatised prison, now followed by all EU states. More privatised prisons are to follow as19th-century jails are closed and vast super-prisons are built, most of which will be run bythe private sector – G4S, Serco, Sodexo. G4S operates in 125 countries, employing over657,000 “security staff”. In Britain its sites range from prisons and immigration centresto secure training units. Elsewhere in the world it provides bodyguards and mercenaries.

The model is the USA prison system. The United States has 5 per cent of the world’spopulation but 25 per cent of the world’s prisoners. The US prison system costs the country$39 billion a year, the equivalent of two-thirds of the US state education budget. Aroundhalf of US prisoners are incarcerated for victimless crimes, with the three strikes ruleensuring there is no rehabilitation in many states.

The standard US state contract with the privatised prison system is that if the prisonhas an empty bunk, the US state faces a financial penalty. So the pressure on the individualUS states is to maximise the prison population. It’s a spiral of madness guaranteeing anever-expanding prison building programme, an ever-growing prison population andguaranteed profits for the companies. In terms of the proportion of prisoners to thepopulation as a whole, the USA tops the prison population league, followed by Britain,South Korea, France, Germany, and Japan .

Two British police forces are seeking to privatise police services, crime investigation,public safety and so on. West Midlands and Surrey are looking at a £1.5 billion seven-yearprivatisation deal. The only police back-room services privatisation to date, Lincolnshire,was for a mere £200 million.

Criminality is to be a revenue stream worth billions as the dividing line between crimeand legality disappears. No longer is it about tackling the causes of crime, which would befar too difficult for the pompously entitled Ministry of Justice and all the agencies whichhang off it – courts, police, probation, and so on, as that would mean tackling the classdivide. The causes of crime, the effects of crime, the victims of crime and thoseunfortunates to be caught are to be nothing more than building blocks in protectingbusiness interests and profits, effectively “legalising” criminality. ■

ON 6 NOVEMBER Greek unions held ageneral strike against a new property taxand further expected attacks on jobs andpay. Already the jobs of 25,000 publicsector workers are threatened. Their paywill be cut by a quarter, and they will besacked if they cannot be redeployed withineight months. Flights and other transportwere disrupted as well as schools andhospitals. Ferries and suburban railstations were at a standstill and thousandsmarched in Athens and Thessaloniki.

There have been more than 30 suchstoppages in the past three years. Aftermassive public sector cuts, tax rises andthe slashing of pensions the unemploymentrate is now 27 per cent. Greeks have beenwarned to expect worse. Unions warn thecountry cannot take any more, saying thatGreece is being destroyed in an endlessnightmare.

Riot police also used tear gas to clearthe headquarters of ERT, the former statebroadcaster. They arrested workers whohad occupied the building and had beenbroadcasting over the Internet since June,when the government sacked its 2,600staff and refused to reopen it without acomplete restructuring. ■

IN SEPTEMBER, Britain had a £9.82billion trade deficit in goods, up from£9.56 billion in August. There was a 24 percent fall in exports of ships, aircraft andmaterials. The deficit for July–Septemberwas up by £3.8 billion on the previousquarter, reaching £29.1 billion. ■

GREECE

General strike

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4 WORKERS

The latest from Brussels

Megalomaniac MerkelGERMAN CHANCELLOR AngelaMerkel wants the EU to have morepowers over eurozone members’ nationalbudgets. Merkel wants legally enforceablecontracts between the EuropeanCommission and individual states. Thesewould set out obligations to maintainbudgetary discipline and improvecompetitiveness; in other words, to reducepublic spending and lower wages.

Waiting for assurances…BRITISH, FRENCH and Spanishintelligence services have been regularlysharing data with the US NationalSecurity Agency, which is said to havemonitored Angela Merkel’s phone andthose of 34 other heads of government.On 23 October MEPs voted to suspendthe Terrorist Finance TrackingProgramme with the US because theNSA has been spying on EU citizens’bank data. The resolution is non-binding.EU Commissioner Cecilia Malmströmsaid the US had given explanations andassurances and that there were noindications that the agreement has beenviolated. She is “still waiting foradditional written assurances”.

Rules? What rules?BARCLAYS BANK believes it can avoidEU rules capping bankers’ bonuses bysplitting pay into three elements includinga new monthly sum based on anemployee’s responsibilities.

The Mafia UnionITALIAN MEP Sonia Alfano, who chairsthe European Parliament’s SpecialCommittee on Organised Crime, said in aninterview with EURONEWS, “Sadly, themafia is already in the control room whenit comes to Europe. [They] have advanceknowledge of what is happening, whereit’s happening and who is taking thedecisions. They have relations with peoplewithin all EU institutions.”

San Marino still not inA REFERENDUM in San Marino to jointhe EU failed; only 20 per cent of itspeople took part, so the minimumthreshold of 32 per cent was not met. Thetiny state has voluntarily adopted theeuro, but does not fit EU rules. This is thethird attempt since 2010 to force it intothe EU, but the first time there has been avote. ■

EUROBRIEFS

Action hits higher educationON 31 OCTOBER academic, administrative and technical staff across the whole ofHigher Education in Britain took successful strike action in their dispute over pay. UCU,Unison, Unite and the EIS in Scotland are all taking action. A further strike day isplanned for 3 December unless progress is achieved by that date.

Classes were cancelled all over the country and regional rallies were held withspeakers from all unions. One of the largest rallies, in Conway Hall in London, showedmembers in the mood to fight. Many speakers angrily described how their institutionshad accrued surpluses in recent years with the rise in student fees, while suppressing staffwages to give those surpluses the extra boost. Speakers also emphasised the need forresolve and discipline on the part of the unions, pointing out that the employers hadclearly been communicating with each other and organising their strategy of keepingwage rates low, continuing the use of hourly paid academic staff on zero hours contractsand using the constant threat of outsourcing areas of university services.

Since the 31 October all academic staff have been working to contract. This entails:staff not working more than their contracted hours where those hours are expresslystated or are stipulated in a workload agreement; not performing any additionalvoluntary duties, such as out of hours cover or covering for colleagues; and not attendingmeetings where such attendance is voluntary on the part of the member.

One effect of the work to contract has been staff realising just how much unpaidovertime they had been working. At St Andrew’s University the academic staff havetaken the interesting step of writing individually to human resources asking for anydocumentation in relation to their contract and this has, in itself, been an effectiveeducation campaign.

A big boost to the campaign has been the huge local and national support from theNational Union of Students and local student bodies. The National Union of Studentshas contacted ministers calling for “a speedy resolution to the ongoing pay dispute, andin such a way that provides a fair and sustainable settlement to higher education staff”.

As WORKERS went to press, the unions were awaiting ministers’ response to their callfor a return to the negotiating table ahead of the planned strike day on 3 December. ■

MORE THAN half of over 1,000unannounced spot checks carried out bythe Health and Safety Executive (HSE) onconstruction sites in September discoveredmaterial breaches of the law. Yet the HSEwill have had its budget cut by more than athird by the end of this parliament. Unitepoints out that at the moment the HSE can

Half of sites breaking the law

HEALTH AND SAFETYonly inspect a tiny proportion of buildingsites and needs more resources not fewer.

Elsewhere Network Rail is to cut 750management jobs, some 15 per cent of thetotal, many of them responsible forsafety – while the Commons TransportSelect Committee is looking at levelcrossing safety. In the past 18 monthsthree people have died on level crossings,with a number of serious injuries, forwhich Network Rail has been fined a totalof £195 million. ■

Photo: Andrew Wiard/www.wiard.co.uk

14 November: the Construction Safety Campaign organised a wreath laying and a minute’ssilence for Richard Laco, the worker killed last week on the Laing O’Rourke building sitebehind the British Library at King’s Cross, where the Francis Crick Institute is being built.

MARCH

Tuesday 4 March, 7.30pm. Conway Hall,Red Lion Square, London WC1R 4RL.“Class in the 21st century”

CPBML public meeting. Some peoplesay class is dead. Or that there too manyto count. Really? The CPBML says thereare only two classes in Britain – workersand capitalists – and that anunderstanding of class is central to anyanalysis of modern Britain. Come anddiscuss. Everybody welcome.

WHAT’S ON

Coming soon

DECEMBER 2013 NEWS DIGEST WORKERS 5

EDUCATION SECRETARY Michael Govehas set the cat among the pigeons with hisrecent defence of the right of “freeschools” to employ unqualified teachersand his call for the right to waivequalifications to be extended to all schools.

“How about unqualified brainsurgeons/ airline pilots etc…” was typicalof the furious reaction he engendered.

Apparently, his cavalier approach toqualifications extends to accountants andthose who look after the books and ensurethat schools are run efficiently and lawfullyfor the benefit of pupils.

Free school fabrications

EDUCATION The much-vaunted Kings ScienceAcademy in Bradford, a flagship freeschool for Gove and Cameron, is in theheadlines again, not for the quality ofeducational provision (damned in the latestOfsted inspection) but for the allegedmisuse of funds.

Fabrication of invoices, employment ofvarious family members of theheadteacher, school funding spent onclothing, the list goes on. The DFE knewabout this for months before being forcedto release details.

As WORKERS went to press, three menhad been interviewed by West YorkshirePolice in connection with “fraud at a freeschool”. One man has got away with it.For now. ■

DETECTED CASES of people traffickingduring the last 12 months in Britain roseby 50 per cent on the previous year. Theseincluded 371 children being used asdomestic slaves or being sexually abusedand, in one horrific example, a Somalianchild brought specifically to harvest herorgans; the child was intercepted by police.The traffic in women increased by 12 per cent, men by 33 per cent.

The Anti-Slavery Society, a Victorianmuseum piece, has seen its membershiprejuvenated. 2013 has seen twoprosecutions under anti-slavery legislationin 21st-century Britain. Workers muststand firm against those who promote sucha trade irrespective of what façade theyhide behind – culture, clan, tribe, caste,gang, family etc. ■

War on the world

US

INDIVIDUAL ASSASSINATION, abuseof human rights, rendition of allegedpolitical opponents, drone bombing andsuchlike is a US war on the world not awar on terror.

Evidence presented to US governmenthearings, arising from the revelationsabout the US National Security Agencyworldwide spying activities, indicates thatUS Special Forces are operating in over120 countries. This represents a doublingof deployment under President Barack

Ignoring shale evidence

ENERGY

50 per cent rise

TRAFFICKING

THE NHS is in crisis. Primary care is failing, Accident and Emergency units are over-extended, access to GP services continues to worsen. Add to this the chaos generated by theHealth and Social Care Act and the abolition of health planning. So the government hasbeen running a diversion about extending GP surgery opening hours, implying that a moveto seven-day opening, 8.00am to 8.00pm, will happen in the near future. This is light-yearsaway from reality. Most GP surgeries do not open after 6.30pm. Less than 1 per cent ofsurgeries open for limited hours at the weekend.

The Royal College of GPs estimates that the NHS needs an extra 10,000 GPs toeradicate the difficulties of getting a GP appointment and also to take pressure off A&Eservices. That’s too much to be provided even by stealing GPs from elsewhere in the world,extending working hours, deskilling staff or shuffling provision among existing GP services.

It would take a massive GP training programme, similar to what Cuba established in1959 after most of its doctors migrated. It is not a question of just putting more moneyinto GPs’ hands but of creating more GPs. Likewise, the training and creation of moreconsultants and specialists resolves hospital waiting lists and helps strengthen primary careto tackle the causes of ill health, with provision for those who then need hospital support.

The NHS faces a crisis caused by a government that wants to break it up and replace itwith private health and private insurance. Health workers and patients should now demandmore radical solutions: seven-day, 24-hour health provision, with adequate skilled staffnumbers. Really make the NHS the service it needs to be.

It is not a question of cost but deployment of resources. Are we to fund health or fundthose who seek a profit from health? Do away with the conflict of interest of small businessmen and women providing GP provision, do away with private practice by consultants. TheCuban health service has shown that there is an alternative providing the highest quality ofhealth care provision in its country and in over 30 other nations worldwide. ■

SHALE BEDS now account for more thana quarter of US natural gas production, upfrom 1 per cent in 2000. Its unconventionaloil and gas production is worth $238billion, creating 1.7 million jobs.

The consequent lower energy pricesreduce US industry’s costs, giving it acompetitive advantage. Four years ago,Europe’s gas prices were about the same asthe USA’s. Now industry and consumers inEU member states pay twice as much forelectricity and three times as much for gas.

Research from Public Health Englandfound that fracking poses no serious medicalrisk. A study by the water industryconfirmed fracking will not contaminate thewater supply. But the environmental lobbyignores the evidence and is doing its worstto stop us developing our shale resources. ■

Obama, a Nobel Peace Prize winner,compared with the George Bush juniorpresidency.

The Special Forces, an “executiveassassination bureau”, are deployed by theJoint Special Operations Command, whichunlike the CIA reports solely to thePresident’s National Security Council.Much of the work of the Command isdelegated to private companies such asBlackwater, supposedly officially bannedfrom Iraq for civilian massacres.

US ground forces are now directlydeployed in over 35 African countriestraining local forces, establishing transitstations, policing the continent. ■

GP opening hours diversion

6 WORKERS DECEMBER 2013

ONE OF the labour movement’s bigsuccesses has been Action for Rail, theTUC’s campaign to fight for a nationallyintegrated railway under publicownership. Supported by the rail tradeunions RMT, ASLEF and TSSA, along withUnite, the campaign helped more andmore people see the benefits of reunitingand renationalising Britain’s privatisedrailways, and stopping the publicly ownedEast Coast franchise from being re-privatised.

“Privatisation” is perhaps the wrongterm. Encouraged by the EU, Europeanpublicly owned railway corporations havealready established a massive presence inBritain’s rail industry, making profits thatare being repatriated to pay forimprovements to the transport servicesand infrastructure in Germany, France and

the Netherlands in particular. It is nosurprise that these foreign players arelining up to take over East Coast. Insteadof making large contributions to theBritish Treasury, the profits would besiphoned off to benefit the taxpayers ofother European countries!

Action for Rail has now recognised thethreat posed by the European Union to itsaims, and is targeting the EU’s Fourth RailPackage. This measure, if introduced,would not only force the rest of Europe toadopt much of the failed fragmentationand privatisation that has been such adisaster in Britain but would also stop afuture British government from reunitingand renationalising the railways.

The TUC and the rail unions lobbiedthe European Commission on 9 October,recognising that the EU’s proposals to

create a Single European Rail Market willentrench privatisation in Britain and willencourage a widespread attack on thejobs and conditions of rail workers andthe use of “social dumping” to encouragea race to the bottom for rail workers'conditions.

But transport trade unions areseemingly oblivious to the dead hand ofthe EU also within the fierce debatesabout the building of a new high-speedrailway in Britain, dubbed “HS2”, andissues associated with that project. Andthere is an immediate threat posed by theFourth Rail Package, an obscuredocument published by the EU in Octoberwhich should be equally worrying for thefuture.

What about HS2? There is no doubtthat massive investment is necessary to

9 November. RMT, TSSA & ASLEF back the European Transport Workers and Action for Rail day of action against EU rail, protestingoutside Europa House, the European Commission Office in London.

Photo: Andrew Wiard/www.wiard.co.uk

Rail unions resist the EU’s plans to hand control over to private companies

The Action for Rail campaign is targeting a European Union measure which, if introduced, would force the rest of Europe to adopt much ofthe failed fragmentation and privatisation that has plagued Britain – and also stop a future government from renationalising rail…

DECEMBER 2013 WORKERS 7

improve and expand Britain’s railwaynetwork, with its infrastructure largelybuilt in the 19th century to 19th centurystandards when steam trains rarely ranfaster than 70 miles an hour. Despiterather than because of privatisation,these railways, severely pruned byBeeching in the 1960s, are now carryingmore passengers than the much largernetwork that existed in the 1920s and1930s when the railways had their last“golden age”.

Not surprisingly, the rail unionssupport the building of HS2 in principlethough there are clearly doubts about thedetail. Professor Henry Overman of theLondon School of Economics and amember of an HS2 analytical challengepanel, set up to provide independentexpert scrutiny, said available evidencesuggested the scheme was “notparticularly good value for money”compared with other transport projects.

“It may well even be poor value formoney compared to other alternativesthat address exactly the same set ofproblems,” he said. “The case forimprovements on the existing lines isactually pretty good in terms of thebenefit-cost ratio, which is the way someof us like to look at these things.”

ControlThe key question for Britain’s workers iswho is to control this new infrastructure,in whose interests will it be run, and who is really making the decisions aboutwhat enhancements are made to thecountry’s rail network.

The debate is currently around howHS2 could connect London with theMidlands, the north of England andScotland, and the economic benefits thatmay flow from that. But the EU – withBritish government connivance – ismaking plans that would bring HS2, alongwith other key rail routes, motorways,ports and airports, increasingly underdirect EU control.

Indeed, it may be the case that shouldBritain decide not to build HS2, the EUmay nevertheless force us to do so. Thisis a takeover of the control of Britishtransport by the EU on behalf of the state-

run German, French and Dutch transportoperations like DB that want to run it.(See article in WORKERS, February 2012.)

As the EU document puts it, “The newEU infrastructure policy will put in place apowerful European transport networkacross 28 member states to promotegrowth and competitiveness. It willconnect East with West and replacetoday’s transport patchwork with anetwork that is genuinely European.” Thisis Euro-speak for the true aim – to havean EU controlled transport network thatwill facilitate a free market economy runin the interests of capitalists, not workers.The EU is less concerned about havingBritain’s cities connected and moreinterested in how they can promote the

free movement of goods and labourwhich, like the Fourth Rail Package, willmean social dumping and attacks on thepay and conditions of workers.

Britain needs investment in rail andother infrastructure in order to meet theneeds of its people by improving mobility,and allowing the country’s industries tomodernise and develop. We cannot allowthe EU to prevent Britain’s rail networkfrom being returned to public ownership,or to dictate that enormous sums ofBritish workers’ money are spent on newtransport infrastructure designed solely tobenefit the EU and the capitalists it existsto serve. And we certainly cannot allowthe EU to control Britain’s transportnetwork. ■

THE EU’S latest strategy on transportwas announced in October and agreedto by British ministers – to little fanfare.

The EU has designated nine “corenetwork corridors” that are seen as thetransport network of the single market.Much of Britain’s long-distancetransport network will fall into one ofthese corridors, the “North Sea–Mediterranean” corridor, whichstretches from Ireland and Glasgowthrough Britain and down to the Frenchports of Marseille and Montpellier.

The North Sea–MediterraneanCorridor includes the whole of the WestCoast main line and the high speed railline between London and the ChannelTunnel (HS1). It's not just rail; keymotorways are included, and theEnglish Channel is now designated as a“Motorway of the Sea”. An EU tenderdocument notes, “In the northern partof the corridor the main missing link isthe cross-border rail connectionbetween Dublin and Belfast whichneeds upgrading and the new highspeed line 2 through Great Britain toimprove travelling times betweenLondon and the North.” For more detail,see http://tinyurl.com/hs2-ten.

All nine core corridors are overseenby so-called “European Coordinators”appointed by Brussels. Since HS2 wouldbe part of the North Sea–MediterraneanCorridor, it would fall squarely into thegovernance of the coordinatorresponsible for it – currently Karla Peijs,a former Dutch minister whose party,Christian Democratic Appeal, lost halfits seats in the country’s 2010 generalelection. You get a flavour of the party’spolitics from how it was formed in 1977:from a merger of three parties, includingthe Anti-Revolutionary Party. ■

Brussels’ grab for our transport

Rail unions resist the EU’s plans to hand control over to private companies

The Action for Rail campaign is targeting a European Union measure which, if introduced, would force the rest of Europe to adopt much ofthe failed fragmentation and privatisation that has plagued Britain – and also stop a future government from renationalising rail…

Kilometre signs on the M25 mark the extent of EU control on our infrastructure.

Photo: Workers

8 WORKERS DECEMBER 2013

The European Union loves it. Employers love it. No wonder. The free movement of labour threatens to undermine all ourworking class achievements…

They call it free movement of labour. They mean the enslavement of labour

Photo: shutterstock.com

/Direk Ercken

OUR PARTY believes that the Britishworking class comprises all who live herepermanently and sell or want to sell theirlabour power, wherever they are from andwhatever their colour or creed. And werecognise that migration is not a benefit forworkers: it is a key way for employers tomobilise and exploit cheap labour. Theemployers generally back both EUmembership and mass migration: both helpthem keep wages down and profits up.

When population rises, wages andconditions fall because when the supply ofa good rises, its price falls. As Karl Marxsaid to the First International back in 1867,“in order to oppose their workers, theemployers either bring in workers fromabroad or else transfer manufacture tocountries where there is a cheap labourforce.” Or both, we should add.

More than 20 per cent of our under-25sare out of work, nearly a million youngpeople. Britain doesn’t need migrantlabour: employers and governments wantit. So governments talk of restrictingimmigration but actually encourage it.

One popular claim is that we needmigrants to save our welfare state – whichis absurd. Are migrants supermen whodon’t get ill, don’t need education ortransport or housing, and don’t get old?They actually add to the pressures on ourovercrowded hospitals, schools, transportsystems and houses.

The government has admitted to theEuropean Commission that it doesn’t haveany figures on how many EU nationalsclaim benefits here, so how could the TUCpossibly claim that “migrant workerscontribute more in taxes than they receivein benefits”?

Immigration is asset-stripping – takingfrom poorer countries their younger, moreeducated and skilled people. Migrationundermines the home countries’development, and increases theirdependency. The EU’s 2001 Code ofPractice for the Active Recruitment of

Healthcare Professionals is voluntary for theprivate sector, allowing poaching. Since thisCode was issued, there has been a surge inmedical migration. Many African andCaribbean countries have more of theirhome-trained doctors working in the OECDcountries than at home. Some 90 per centof Jamaica’s nurses and 90 per cent ofHaiti’s nurses work in OECD countries. Thisbrain drain widens world health inequality.

Just as Zionists claim that anti-Zionismis really anti-semitism, the ultra-left claimthat opposition to border controls is racism.One could indeed be against the EU, oragainst immigration, for racist reasons. Butwe are against them because we know thatEU membership, and mass immigration, arebad for the British working class.

SmearReactionaries use this smear of racism tocover their support for the neoliberal policyof free movement of labour, which is thetwin of the free movement of capital. Freemovement of labour is part of the processof capital accumulation.

Supposed internationalists back thefree movement of labour on the groundsthat migrants grow our national economy.But if they do, they can’t be growing theirhome countries’ national economies. Theirproductive labour benefits employers inBritain, at the expense of their homecountries.

British Jobs for British Workers is a callfor full employment, for the right to work.You could only call it racist if you assumethat all British workers are white Anglo-Saxons – which would mean that you hadthe racist notion of pure-bred Britons. Sothe ultra-left who decry British Jobs forBritish Workers as racist are the ones guiltyof racism.

The GMB’s Paul Kenny said British Jobsfor British Workers “could play into thehands of racists and bigots”. Would theslogan Polish jobs for Polish workers causethe same alarm? Are we supposed todemand Polish jobs for British workers? OrBritish jobs for Polish workers? In theUniversities and Colleges Union, we hearsome people call for places in Londoncolleges for London’s young people, but

then decry British Jobs for British Workers!Not very consistent, not very logical.

Currently, government and vice-chancellors prioritise recruiting rich foreignstudents. If our colleges don’t prioritiseeducating Britain’s young people, who will?Chinese colleges? I don’t think so.

Yes, employers use migrant workers tocut costs. Yes, recruiting migrant workersprevents the development of more high-skill, high-technology production. Yes, wehave all too little labour-market regulation,no proper skills training, and hardly anyapprenticeships. Investment in skillstraining, and better wages and conditions,would cut the demand for migrant workers.

A particularly destructive and insidiousapproach to creating cheap labour is theuse of “posted workers”, sent by theiremployers from one EU country to anotherfor temporary work. Foreign subcontractors,temp agencies and hiring companiesemploy millions of them on subprimewages and conditions across the EU –including ten to fifteen per cent of thebuilding workers in Britain. The wage floorsapplied to posted and migrant workers arewell below the going rates in nationalindustries. The European Court of Justicerestricted posted workers’ rights to aminimum and then outlawed all attempts toimprove them. So it is hard for our tradeunions to organise these workers. So muchfor the EU social model!

What is the real EU social model? The1957 Treaty of Rome, the EEC’s foundingtreaty, laid down “the abolition, as betweenMember States, of obstacles to freedom ofmovement of persons, services andcapital”. The aim was and is to create amore flexible labour market. The 1997Treaty of Amsterdam laid down that onlythe EU had competences in the areas ofmigration and asylum.

Who runs the EU? The EuropeanRoundtable of Industrialists, composed ofthe CEOs of the biggest corporations, is thereal power in the EU. It drives all for theemployers, all against the working class.TheIMF, the World Bank, the CBI, all back theEU’s three freedoms.

The European Union loves it. Employers love it. No wonder. The free movement of labour threatens to undermine all ourworking class achievements…

They call it free movement of labour. They mean the enslavement of labour

DECEMBER 2013 WORKERS 9

Continued on page 11

This article is an edited version of aspeech delivered by a comrade at aCPBML meeting at Conway Hall inLondon on 12 November.

10 WORKERS DECEMBER 2013

Photo: Richard Whitcom

be/shutterstock.com

Borocay, Philippines, 9 November 2013: the devastation wrought by Super Typhoon Haiyan.

WATCHING THE recent footage of theinjured survivors of Typhoon Haiyan, it isimpossible not to think about the manythousands of Filipino nurses working inNHS and US hospitals who are neededso desperately in their own country. TheNursing and Midwifery Council reportedin February 2013 that just over 16,000 ofthe 670,000 nurses on the UK nursingregister are from the Philippines. InCalifornia, 20 per cent of all registerednurses are Filipino.

Currently the Philippines are cryingout for public health staff whounderstand infection control and whocan work with other agencies to secureclean water and nutrition. It also needsthose nursing staff to immunise againstdisease, dress wounds, deal with brokenbones and the widespread psychologicaltrauma. Unlike socialist Cuba whichlooks after its own population’s healthfirst and where average life expectancyis 80 years, l ife expectancy in thePhilippines (before this current disaster!)was less than 70 years.

So we have the absurd position ofthe British public sending money to thedisaster fund and paying for one or twoBritish medical teams to fly out, whilesimultaneously recruiting essential staffthere to work in Britain. And don’t forgetthat for each nurse recruited from thePhilippines there will be a recruitingagency company pocketing thousands ina “recruitment fee”.

So the next time you hear apolitician say we need immigrationbecause the British do not like to gettheir hands dirty remember the followingsimple facts:

• Young and more mature Britishpeople want to work in nursing. Thereare more applicants than placesavailable on nursing courses across thecountry. And yes – nursing does involve“getting your hands dirty”.

• Despite fierce opposition fromtrade unions and professional bodies,and the anticipated rise in population,especially those who are elderly, thenumber of places on nursing courses at

universities in Britain has been reducedby 2,500 between 2010 and 2013.

• NHS trusts have axed nursingposts in an attempt to find £15 billion“efficiency savings”, leading toredundancies and freezing of postswhich has made it difficult for somenewly qualified nurses to get a job.

• A Freedom of Information requestby NURSING TIMES magazine in October2013 established that 105 NHS trustshave actively recruited nurses fromoverseas in the last 12 months, while 41said they now planned to do so.

In short we are poaching workersfrom abroad because it saves on thecost of growing our own. This appallingpractice is now extending to other areasof the health service such as therecruitment of paramedics – again wherethere is no shortage of applications fromwould-be paramedics here. This is anational and international disgrace asthere is a worldwide shortage of healthworkers and all that poaching does iswiden health inequalities globally. ■

Case study: the movement of nursing labour

DECEMBER 2013 WORKERS 11

The European Commission alwayspushes for the free movement of labour: in1997 it produced its Action Plan for FreeMovement of Workers; in 2002, an ActionPlan for Skills and Mobility; in 2006 a “Yearof Workers’ Mobility”; and for 2007-10, aJob Mobility Action Plan.

All the EU’s Free Trade Agreementsinclude Mode 4, installing the freemovement of labour, and not just within theEU. In the EU/India Free Trade Agreement,talks, for example, India’s sole demand isfor worker entry access. It would let anyIndian firm supply temporary workers toany British industry. Employers will get thegain (investment opportunities in India) andBritish workers will get the pain (lost jobs).

What is the effect of EU policy here? ByJanuary, 2.3 million European nationalswere living in Britain: 551,000 wereunemployed or economically inactive and146,000 had never worked. The number ofthe economically inactive has risen by 23per cent since 2008 and that of those whohad never worked is 30 per cent higher.Existing EU free movement rules gave themaccess to benefits and the social assistancesystem, the right to live here and automaticpermanent residence after five years.

In 2004 the Labour government gaveimmediate labour market access to thenationals of the eight new central andeastern European EU members, supposedlyto expand “selective migration”. Orthodoxeconomists chorused that this would growthe economy. The Home Office said 13,000at most would come. In fact, we had thebiggest wave of immigration in our history:494,000 that year. 2.3 million peoplearrived here during the Labourgovernments, plus an estimated one millionillegal migrants.

New EU members are having theirpopulations stripped. By 2009, five millionhad left the eight countries that joined in2004. Some 10 per cent of the population ofthe Baltic States have left just since theeconomic collapse of 2008.

Belarus, by contrast, rejectedcapitalism, rejected the IMF and rejectedthe EU, so it enjoys full employment, freehealthcare, free education and its decent

Soviet-era pensions continue to be paid, ontime. And so people come to it, rather thanleave: its population is on the increasewhile rising numbers of people are fleeingthe stricken south of Europe, fleeing theeffects of the euro. One million people leftSpain alone from early 2011 to mid-2012.

There is also people trafficking, theworld’s third largest illegal money-makingenterprise, after running weapons andrunning drugs – the UN estimates it couldbe worth $12 billion a year. A 2003 estimatewas that nearly one million people werebeing trafficked every year, includingpossibly 175,000 a year from Russia andEastern Europe’s countries.

Organised crimeFree movement of labour also assistscriminals to move goods and people acrossborders. Once the traffickers and theirvictims are inside the European Union, allmember nations are fair game andmovement for organised crime becomesrelatively free.

Traffickers use Britain as a transit pointto other EU members, partly because thereis no requirement for interviews whenchildren are brought into Britain, unlike inFrance and the USA. The lack of exit checksalso assists traffickers. The Labourgovernment ended these checks in the1990s; the present government pledged toreinstate them by 2015, but Clegg admittedrecently that they wouldn’t meet thispledge. Funny how Cameron uses Clegg toannounce broken promises. Is his real job

title the Minister for Broken Promises?Countries have the right to regulate

entry; they can prevent or reduce migration.Opening our doors in January to allBulgarians and Romanians will create aneven greater oversupply than we alreadyhave. Scarce jobs will become even harderto find and employers will have everyincentive to reduce wages.

Why are we opening our doors? Is itbecause Parliament decided to ? Or that thepeople decided so in a referendum? No, it’sbecause the EU is ordering us to do so. Weshould decide, not the EU. Would they havejobs to come to? No – they would becompeting for scarce jobs with indigenousBritish people, black and white. A greatersupply of labour would force wages downeven further and put extra strain on ourhousing, healthcare and education. So weneed a stop to new entrants.

A recent FINANCIAL TIMES poll, showed 83per cent of us want less migration, raisingthe issue of power: Who decides? Is it us,or the EU for us? In 2007, Britain opted outof the European Charter of FundamentalRights. Now the European Court of Justice,for the EU, has opted us in. What next? Willthe EU opt us into the euro?

We need a referendum as soon aspossible, so that we can leave the EU assoon as possible. We have to organise inour workplaces, revive our trade unions andstand and fight where we are.

We need to take responsibility, decidewhat level of migration we want, and thenmake it so. ■

Continued from page 9

The great Marxistclassics – all in one book

This Christmas, buy a book that combines the textsthat inspired revolutions: The Communist Manifesto,Lenin’s State and Revolution, Mao’s On Practice andOn Contradiction, and Stalin’s Foundations ofLeninism. It costs just £10 + £2 postage.

Send orders to CPBML PUBLICATIONS, 78Seymour Avenue, London N17 9EB. Please make allcheques payable to “WORKERS”.

12 WORKERS DECEMBER 2013

THREE AMERICAN hedge funds have nowseized 70 per cent of the Co-op’s assets,reducing tens of thousands ofshareholders’ and small investors’ bonds tojunk value. With a customer base of 4.7million people, linked to the wider Co-opgroup base of 7 million people, the onlybank in Britain operating on ethicalinvestment principles, having turned away£1.2 billion of unethical business since1992, has now been devoured by USvultures.

The postmortem is still being carriedout on how a £1.5 billion black holeemerged in the Co-op’s finances. With mostof the senior boardroom executives anddrivers of supposed expansion now gone –many with extremely handsome payoffs – itis worth reviewing what went wrong. In thebackground is the amazingly disingenuousposition of the government: they publiclystate they want to see the breakup of themonopoly position of the four big banks

(Lloyds, Barclays, HSBC, RBS). Thegovernment suggests that the solution tothis bank monopoly is the development ofmutual banking. Mutual banking is notsupposed to run the risks of unethicalbanking procedures, policies and criminalactivity that have dominated bankingworldwide since the 2007 collapse.

Standard practiceLooked at historically such unethicalbanking procedures, policies and criminalactivity have been the norm – standardpractice since the banks achieved amonopoly over finance and industrialcapital in the early 20th century.

The true position of the governmentregarding the banks has been to promote,strengthen, bail out, acquiesce to theirdemands, and ensure that banking andfinance is supported against all otherinterests in Britain. The government’spromotion of mutual banking was and is a

smokescreen to camouflage their realintentions from the gullible who still think“we are all in this together” or that“austerity economics” works.

Far from promoting mutual banking,what they really were doing was signallingto their financier friends to attack anddestroy mutual banking as they did withbuilding societies in the late 1990s.

The Co-op was encouraged to mergewith the Britannia Building Society in 2009to expand its financial base. The Britanniahad very close links with the trade unionmutual and building societies dating backto 1856. But the Britannia and six otherbuilding societies were the target ofpredatory raids in the late 1990s during thedestruction of building societies – whentheir assets were stripped and they wereconverted or absorbed into banks.

As far as the misnamed banking“industry” is concerned, building societiesare juicy morsels ripe for eating. But how

Photo: Workers

Boom, the (almost) bust: the Co-op Bank’s rescue came at the expense of staff and customers.

Smash and grab in the high street as US vulture funds sink their talons into the Co-op

In less than 18 months the Co-op banking group has gone from being the largest mutually owned bank in Britain to beingtaken over by three US hedge funds…

DECEMBER 2013 WORKERS 13

much cleverer to get a mutual bank to eatthe building societies, rather than the highstreet raiders, and then devour the mutual!

The merger with Britannia was giventhe green light by the Financial ServicesAuthority (FSA), which found nothing amisswith Britannia’s accounts. At the same timethe Co-op was encouraged to take over 631branches of Lloyds Bank, after it crashed inthe 2007-8 banking crisis.

As the merger with Britanniadeveloped, toxic debts totalling over £600million were identified from loans geared tothe buy-to-let housing market, sub-primemarket scam etc. The FSA missed most ofthose debts. In fact it only identifiedbetween £30 million and £40 million indodgy loans. The combination of dodgyBritannia debt, the Co-op choking on tryingto swallow the Lloyds branches, poormanagement and inefficient computersystems, sent the overwhelmed Co-op intospiralling decline.

Gaping holeA gaping hole of £1.5 billion emerged in theCo-op’s accounts. Britain’s largest mutualwas faced with bankruptcy, or begging for agovernment bailout as their non-ethicalcompetitors had done previously, orseeking a market solution. Seeking amarket solution was not really an option asthe “market” had already seen anopportunity, a solution which suited them.Aggressive share and bond purchase by theUS hedge companies gave them financialcontrol of the bank.

The ensuing “rescue” has turned theCo-op into yet another unethical bank. Joblosses of 10 per cent amongst the 10,300workforce have been announced. 15 percent closure of branches, 50 out of 324, areto follow. A shift to online and Internetbanking will see the Co-op float not only onthe Stock Exchange but very likely off-shore.

The 170-year tradition of the RochdaleSociety of Equitable Pioneers, whichestablished in 1844 their mutual bankingopposition to capitalist banking, will bewell and truly dead. How long will theethical principles of the Co-op remain, nowownership of the bank has transferred from

its 4.7 million customers to shareholders,tax exiles, finance houses and other conartists? How long can the “Co-op” nameand mutual banking regulations be appliedto the Co-op? The very basis of the bankhas changed. Vince Cable, Secretary ofState for Business is already beingchallenged under the Companies Act,section 76, to seek governance assurancesfrom the new owners to uphold the Co-op’sethical principles and rules – but this is afutile effort to disguise the truth

All the proponents of expanding the Co-op into a huge high street challenger to theso-called big four banks have nowdeparted. The Co-op as was lies in ruins,occupied by the very forces the mutualbanking ethos was supposed to see off. Isthis an accident or deliberate plan by thoseideologues of the so-called free marketwho saw the opportunity to destroy anational entity, with the largest customerbase opposed to the culture of high streetbanking? In the last 18 months the Co-ophas seen thousands of new accountsopened as banking customers fled from thebig four banks and their dodgy practices.

Now a coup by hedge fund managers, ablyassisted by expansionist greed and self-interested management, has wiped out therefuge of millions of customers who are notenamoured of the corruption of bankers.The attack on the Co-op, a working classinstitution, is similar to the attacks on othernational institutions and entities – the NHS,the BBC – which market capitalism alsowishes to devour.

Worldwide banking, despite the 2007-8crisis and subsequent crash, has seen twointeresting phenomena: job losses andrising profits. In 2008, 795,000 workerswere employed in banking. That figure hasdropped by around 24 per cent in 2013 to606,000 – RBS had 78,000 job losses,HSBC 59,000, Lloyds 31,000, Barclays21,000. Lloyds posted half year profits of£2.1 billion in August, RBS £826 million forthe quarter ending in March, and HSBC£5.4 billion in the first quarter of 2013.

The Co-op has been truly smashed, itsassets grabbed – and a 170-year traditionin working class history and exercise ofpower different to capitalist ethos broughtto an end. ■

eet the PartyThe Communist Party of Britain’s new series of London public meetingscontinues in 2014 on Tuesday, 4 March, 5 June, 14 October and 18November; all are held in the Bertrand Russell room, Conway Hall, RedLion Square, Holborn, London WC1R 4RL, nearest Tube Holborn, and startat 7.30 pm. Other meetings are held around Britain. All meetings areadvertised in What’s On, see page 5.

The theme of the meeting on Tuesday 4 March, is “Class in the 21stcentury”. Details of further meetings will be announced in WORKERS

and at www.workers.org.uk. The Party’s annual London May Day rally is always held on MayDay itself, regardless of state bank holidays – in 2014, Thursday 1

May, in Conway Hall, Holborn. There will also be May Day meetingselsewhere in the country.

As well as our regular public meetings we hold informaldiscussions with interested workers and study sessions for those

who want to take the discussion further. If you are interested we want tohear from you. Call us on 020 8801 9543 or e-mail toinfo@workers.org.uk

MM

MM

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Smash and grab in the high street as US vulture funds sink their talons into the Co-op

In less than 18 months the Co-op banking group has gone from being the largest mutually owned bank in Britain to beingtaken over by three US hedge funds…

ONCE THE Second World War was won in1945 by the allies and peace became thenext prospect, the precarious position ofBritain’s economy, distorted by six years oftotal war, was apparent. Britain wasexporting only around a fifth of what it hadbefore the war and non-military importswere five times higher than in 1938. Therewere still 1.4 million people in the armedforces by 1946.

The British economy had been heavilygeared towards war production at around55 per cent of GDP, much greater than inthe Soviet Union or America. To makematters worse, US President Trumanabruptly ended in August the wartime LendLease arrangements that had run since1941, by which war effort equipment hadbeen donated. Suddenly, payment wasexpected for undelivered supplies, Britainfound it did not have enough dollars, andbankruptcy loomed. As an emergencymeasure, the government sold gold andminerals, but this could not suffice forlong.

Prime Minister Attlee dispatched JohnMaynard Keynes, the economist andgovernment financial adviser, as Britain’snegotiator in Washington. Most of Britainexpected a gift in recognition of thecountry's contribution to the war effort,which had predated that of the US, andKeynes believed he could wrest a multi-billion dollar grant-in-aid out of the USArather than a loan. Despite three monthsof severe clashes and hard wrangling,Keynes returned with a loan and a heart-attack for his troubles. The Anglo AmericanAgreement produced a business loaninstead of a subsidy, with extra conditionsstacked in America’s favour.

Unsurprisingly, the USA ignoredsentiment and pressed its own imperialinterests proving that a “SpecialRelationship” had never existed, exceptinside the confines of Churchill’s mind.Two determining factors were at work: ourdiminished productive base limitedBritain’s ability to manoeuvre in apeacetime environment; and our rulers’senseless wish to sustain the empire post-war (though it was clearly unaffordable)made them chase a costly external loan.

Although the granting of the loan did

strain relations between the two countries,the agreement was never reallythreatened, despite some opposition in theHouse of Lords and the likening of Americato Shylock by a Cabinet Minister. InDecember 1945, Attlee and the LabourGovernment succumbed, agreeing to notonly a US loan of $4.34 billion (double thesize of the then British economy) but alsoother onerous stipulations.

Contrary to the impression given bypoliticians in later decades, the loan wasnever used to finance the war itself,though outstanding Lend-Lease suppliesstill in transit when peace was declaredwere paid for within the overall loan. Theloan (structured like a mortgage) was to bepaid off in 50 annual repayments startingin 1950; payments were mostly interest inthe early years and shifted toward capitallater on.

Other stringent conditions wereimposed on a submissive Labourgovernment, namely acceptance of theconvertibility of sterling and theliberalisation of trade. The convertibility ofsterling directly caused the financial crisisof 1947, as Britain was forced to letholders of sterling convert their earnings

14 WORKERS HISTORIC NOTES DECEMBER 2013

into other currencies such as the dollarand allow these earnings to be spentoutside of the sterling area. Convertibilitymeant the demise of British economicmanagement at home and of economiccontrol of the colonies. Gradually, Americaexploited liberalisation of trade to displacethe position of British companies in formercolonies.

Not for BritainDespite assertions in subsequent decades,the purpose of the loan was not to rebuildBritain or aid domestic recovery but tomeet expensive imperial commitments. AsKeynes himself wrote in 1946, “…theAmerican loan is primarily required to meetthe political and military expenditureoverseas.” Keynes estimated that Britainspent £2,000 million on policing andadministering the Empire. This expenditurewas largely responsible for the country’spost-war financial difficulties.

A telling comparison emerges if youlook at the provision made available foressential sectors of the domestic economyon which working people’s livelihoodsdepended: between 1947 and 1949 only£320 million was invested in building

Our ruling class has a track record of not protecting Britain’s national interest. Onetypical episode occurred at the end of the Second World War…

More than a loan – the Anglo-American Agreement of 1945

The Blitz, London, 1941: a devastated Britain emerged from the way in debt up to its eyeballs to the United States.

DECEMBER 2013

manufacturing industry; £262 million intransport and communication, £160 millionin energy industries and £85 million inagriculture and fisheries.

As there were six deferred instalments,this debt to the USA was only fully repaidby the British government in 2006.Although at the time Treasury Minister EdBalls acclaimed it as “a sign that the UKrepays its debts”, what is probablyunusual is that the debt was repaid at all,as Britain has a patchy record on debtrepayments. There are unpaid debts thatpredate the Napoleonic Wars, and debtsstill owed for the First World War.Moreover, at the height of the GreatDepression in 1931, a moratorium on allwar debts was agreed and no debtrepayments were made or received after1934.

It was complete stupidity to take onthe burden of a huge loan when in 1946Britain’s national debt stood at about 250per cent of GDP and when the loan wasnot directed to the essential task ofrebuilding our industrial capacity butsquandered on a futile attempt to prop upa crumbling empire and support theobsolete role of world policeman. ■

Our ruling class has a track record of not protecting Britain’s national interest. Onetypical episode occurred at the end of the Second World War…

More than a loan – the Anglo-American Agreement of 1945

The Blitz, London, 1941: a devastated Britain emerged from the way in debt up to its eyeballs to the United States.

Our country is under attack. Every single institution is in decline.The only growth is in unemployment, poverty and war. There is acrisis – of thought, and of deed. The Communist Party of BritainMarxist-Leninist has recently held its 16th Congress, a comingtogether of the Party to consider the state of Britain and what needsto happen in the future. Here we set out briefly six Calls to Actionfor the British working class – for a deeper explanation, seewww.workers.org.uk.

1: Out of the European Union, enemy to our survivalThe European Union represents the dictatorship of finance capital, foreign domination.The British working class must declare our intention to leave the EU.

2: No to the breakup of Britain, defend our national sovereigntyDevolution, and now the threat of separation, are both products of only one thing: de-industrialisation. Any referendum on the break-up of Britain must be heldthroughout Britain.

3: Rebuild workplace trade union organisationUnions exist as working members in real workplaces or they become something elseentirely – something wholly negative. Take responsibility for your own unions.

4: Fight for pay, vital class battlegroundThe fight for pay is central to our survival as a class, and must be central to the agendaof our trade unions.

5: Regenerate industry, key to an independent futureThe regeneration of industry in Britain is essential to the future of our nation. Our grand-parents, and theirs, knew this. We must now reassert it at the centre of class thinking.

6: Build the PartyThe task of the Party is singular: to change the ideology of the British working class inorder that they make revolution here.

Interested in these ideas?• Go along to meetings in your part of the country, or join in study to help push forwardthe thinking of our class. Get in touch to find out how to take part.

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‘Failedeconomistshelped causethe crash.They’ve beenrewarded withprizes. Butthey’re still onthe syllabus inuniversitiesaround theworld…’

Hope for the dismal scienceECONOMICS IS widely known as the “dismalscience”, and the description rings true, sodismally has classical economics performedover the past century or more. (Marx, ofcourse, was right.) One bright spot is that thenew generation of students seems unwillingto stick with the mistakes of the past.

Economics students at the University ofManchester had been wondering (in their ownwords) “whether economics undergraduateswere being taught the right things in the lightof the 2008 Financial Crisis”.

A good question. They were being taughtthe dismal theories of the discreditedeconomists who had played their full part inblowing up the bubble that burst sodisastrously in 2008. People like RobertLucas, awarded the Nobel Prize for Economics,who in 2003 said the “central problem ofdepression-prevention has been solved”.Unchastened by reality, he said in 2011 thatthe big threats to the US recovery wereMedicare and higher taxes on the rich.

Then there’s Robert Merton and MyronScholes, from Harvard and Stanford, Nobellaureates both. Along with Fischer Black, whodied before he could collect his Nobel, theyfounded the “science” of derivatives. In 1970there were no derivatives traded on themarkets. Then Black and Scholes publishedan infamous equation “explaining” how itcould all work. Merton came in later. By 2004the notional value of derivatives tradedglobally was $273 trillion.

These bourgeois economists helped causethe crash. They’ve been heaped with prizes.They’ve been rewarded as befits loyalservants of finance capital. And they’re still onthe syllabus in universities around the world.

The Queen asked at the LSE why no onesaw the crash coming; no one could answerher. No wonder the Bank of England called aconference on the subject, “Are economicsgraduates fit for purpose?” (As if the Bank

itself were actually fit for purpose!)No wonder, too, that the students at the

University of Manchester this year set up the“Post-Crash Economics Society”. They believe“that the content of the economics syllabusand the way it is taught could and should beseriously rethought”.

What is surprising – and a tribute to thestudents – is how seriously their challenge toeconomics orthodoxy is being taken.Prominent (non-neoliberal) economists haveflocked to their banner. The students put theirfinger on a problem that no one wanted totalk about but that could no longer be dodged.

One echo has been the development in aproject headed by Wendy Carlin, a professorat University College London, to introduce anew first-year curriculum for economicsstudents. According to reports, it will includein-depth study of economic history and theway financial markets can undermineeconomic stability.

“The pressure for change from students,faculty, business and policy makers, alongwith new developments in economics, makesthis an auspicious time to seek improvementsin what economics students learn, and howthey learn it,” said Carlin.

The students, then, have been teachingtheir teachers a well-earned lesson. Not sodismal after all.

Actually, the term “dismal science” wascoined by one of the most dismal bourgeoiseconomists of all time, Thomas Carlyle, betterknown as a (pretty dismal) historian. He usedthe term to attack John Stuart Mill for sayingthat abolishing slavery would lead to animprovement in the lot of the slaves. Carlyle,dismal as he was, argued strongly and, as itturned out, totally wrongly that emancipationwould be bad for the slaves.

Getting things wrong has been a themeamong bourgeois economists for quite a time,it seems. ■

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PublicationsCHANGE BRITAIN, EMBRACE YOUR PARTYThis pamphlet brings together thestatement from the Party’s 2009 Congresswith those from two former Congresses in2003 and 2006. Also included is astatement on the European Union: “Thefascist dream of a united Europeresurrected.” (£2.75 including P&P).

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