Financial Crisis and a Marxist Response

Last night I caught a snatch of a “Briefings” programme on the BBC parliament Channel – unfortunately no longer available on-line – on the financial crisis. It was a talk given by Will Hutton of the Work Foundation and Martin Wolf Chief Economics Writer at the Financial Times. The bit I was interested in was in response to a question to Will Hutton, about the role that could be played by Co-operative and Mutual organisations, Credit Unions etc. Interested obviously because fort he last few years I have been arguing that a Marxist Programme has to be built around a bottom up approach of workers self-activity to develop such alternatives to Capitalism, the strategy indeed that Marx and Engels themselves advocated.

As Hutton pointed out, and as he had earlier warned, the consequence of demutualisation of Building Societies during the 1990’s was bound to lead to the kind of consequences we have seen since. Organisations that were once dependent upon their members, borrowers, and which, often based within local communities with the potential at least for democratic control, became like any other capitalist enterprise concerned merely with the bottom line, with profit maximisation, and as with Northern Rock, found the way to that by abandoning the principle of financing lending from saving with the disastrous reliance on the Money markets that has caused the chaos now as a result of the Credit Crunch. The fact that the potential for democratic control over these institutions, remained largely a potential rather than a reality, is not a real criticism of them anymore than the fact that there is a potential for democratic control over the Trade Unions, which is not taken up is an argument against Trade Unions. Rather it is a question for socialists to ask why it is that workers do not take up the opportunity for such democratic control, and find means of ensuring that they do.

The news that the Co-op Bank is in talks with the Britannia Building Society – which is linked to my own union UNISON, and remains a Mutual – to create a huge £75 billion Bank is great news. It should also be the catalyst for Unity Trust to join this organisation and begin to provide workers with a real means of exerting economic muscle. Already, the Co-op has a large role in the provision of Pensions and other Financial Services including the Co-operative Insurance arm. But, if a workers Bank is to really serve the needs of workers and take on the Capitalist Banks a number of things are necessary. Firstly, the other mutuals such as Nationwide should be brought under its umbrella. More importantly, it is necessary that such an organisation really is one that is under the control of workers, and that will mean creating structures throughout the Labour Movement to ensure that not only Board Members are truly representative of workers, but that the policies adopted are geared to meet workers interests, not just in the short-term, but in the longer term. That is such an organisation has to be not just a Bank owned by workers, but a workers organisation fighting alongside workers as part of the class struggle. The development of such an organisation would be an easy way for workers to demand the transfer of all their pension funds to its control, increasing its financial strength enormously – Workers Pension funds in Britain even after the current Stock market falls still amount to over £300 billion.

The Co-op already operates an “Ethical” policy refusing to deal with companies that do not meet certain criteria on the environment, working practices etc. But, “Ethical” is not enough. Oddly, whilst I was on holiday I was talking to the retiring head of the Co-op who had just bought one of the villas I was looking at. I took the opportunity to not only briefly raise some of these issues with him, but also to harangue over my own experiences with the Co-op. Twenty years ago, when I was president of the local TUC I organised a number of activities in support of the Silentnight workers who had been sacked. We contacted the local Co-op asking them to stop selling Silentnight beds. They refused. So we organised a leafleting outside their store. The outcome was that the manager called the Police, and myself and another comrade were arrested for “Conduct Likely to lead to a Breach of the Peace”. When I asked what that conduct was I was told it was handing out leaflets the content of which someone might take offence to! I also told him that I had rejoined the Co-op a year or so ago as a result of my experience of the local Co-op and because of my conviction that socialists should pursue Co-operative forms. My local Co-op, in a small Village mostly inhabited by pensioners now, I found stocked nothing that you’d expect. It seemed to have a lot of floorspace for booze, but despite the fact that there is no Butcher or Greengrocer in the Village, stocks no fresh meat, almost no frozen meat, and very little in the way of fruit or vegetables. I sent an e-mail about this to the Co-op about a year ago, but the situation hasn’t changed. I’m now trying to get other Labour Movement activists in the area together with the idea of arguing for a local Management Board for the Village Co-op.

But, this illustrates the point. If such Co-operative ventures are to have any socialist content it requires that workers exert control over them.

See Also:About the Co-op

And Co-operatives, Marxism and Guian economics

Incidentally, a good example of the "Kitsch" Marxist approach is given in this piece by the Alliance for Workers Liberty.

here .

The AWL talk about the Banks being taken over by a "Workers Government" that will ensure they are under Workers Control. Unfortunately, they don't inform us where this Workers Government is about to materialise from!!!! Elsewhere, they have said that socialists should not raise demands whose consequences are not what they desire. But, the only "Workers Government" that exists and could exist at the present time is the one we have. To demand the nationalisation of the banks, means in effect calling on the present Governemnt to do that! If the idea of a Workers Government had any grip on reality i.e. if the working class had a sufficient level of class consciousness that it had created a Workers Party that could be elected to Parliament with sufficiently socialist credentials and MP's to carry out such a policy, then such a programme would in fact be inadequate, because it would mean that workers themselves would be taking over the Means of production! But, of course, like most of the AWL's politics it doesn't have any grip on reality its nothing more than ridiculous demands for Socialism Now drawn up by people who want to draw up schema for socialism just as did their predecessors the Petit-Bourgeois socialists criticised by Marx. They claim to believe in "independent working-class politics", for the self-activity of the working class, but here as elsewhere they reveal in fact that they beleive in nothing of the kind, but in Lassallean programmes for the workers problems to be resolved by the State, and as Marx pointed out the only State that can mean is the one that exists - the Bourgeois State. As Marx pointed out in his Critique of the Gotha Programme those socialists that place such demands on that State are no socialists at all. They have not yet learned to get up off their bellies in their cringeing towards it, and until they do they are in no position to lead the workers.