Whoa!!

The CIPS Services, May, Purchasing Manager's Index was out this morning and showed a reading of more than 51. Any reading over 50 signifies growth in the economy. Given that the Service sector now represents the largest part of thee conomy this reading is significant as an indication of a return to growth in the economy as a whole! In fact, the future intentions component of the index, which measures how much Purchasing Managers are intending to be icnreasing their buying in coming month's, showed an even more significant rise to almost 70!

Philip Shaw of INVESTEC, said this morning that it could mean that the Second Quarter GDP figure could actually show a return to growth, that he said, as I have been arguing that its likely to be the Third Quarter that will see a return to growth. Even so, given the level of pessimism and warnings of almost total collapse of the Casandras in the last six months this is a remarkably strong rebound from the sharp seizure in economic activity that happened at the end of last year. As I have been arguing for a long time, however, it shows the underlying power of the Long Wave Boom that has been driving the world economy forward since about 1999.

In further data out this morning the Nationwide said its survey of Consumer Confidence had seen a bige rise too. As I said yesterday its like running just to standstill with all of the data coming out, which shows continuing improvement.

Now wonder Gordon Brown will want to delay the election until next year. Harold Wilson once said a week is a long time in politics. In 1981, when Michael Foot was leading thousands of workers through the streets of Liverpool and other cities to protest at 3 million unemployed he was standing at 51% approval in the opinion polls with Maggie Thatcher looking like she was going to get trounced. A year later after the Falklands War she won one of her biggest election victories. In 1991, at the time of Black Monday when the pound got trounced on the Foreign Exchange Markets, and interest rates soared, John Major looked to be on his way out. A year later after leaving the ERM meant interest rates could be cut, and the result was a return to rising house prices he again won a victory - though the antics of the prat Kinnock helped him to some degree. A dramatic change in the fortunes of Brown and the Labour Party in the next year, alongside the dramatic turnround in the economy should not at all be ruled out, however, improbable it seems at the moment.

Either way, the place for Marxists at the moment is in the LP using it as a vehicle to mobilise support for workers in struggle in the workplace and in the community. The rising economy will create an upsurge in workers militancy as they feel their strength and confidence growing. The result will be a rise in syndicalism as success in industrial struggles will encourage the view that everything can be achieved by such means. But, its concomitant is reformism, the idea that political gains can be won within the system too. If organisations such as the SWP and SP stand to make some gains from the former as a result of their industrial militants, then the LP stands to gain far more from the latter. Neither offer a real solution for the working class. Only Marxists struggling to build the LP as the Workers Party on a non-sectarian basis by orienting it outwards to workers day to day struggles and problems can do that.