Thursday, 8 October 2015

Tory Conference Displays Just How Out of Touch They Are

Its not just the fact that the Tory Party Conference was stuffed with chinless wonders, passing their adolescence at Eton and other such establishments.  Its not just that it is still full of 1980's throw backs, who haven't recognised that the world has moved on, and still have realised that Thatcher's policies from that time were a disaster for British capital, as well as British workers, or even that this is reflected in the fact that male or female so many of those delegates see themselves as latter day manifestations of The Iron Lady, and that Cameron's policies are modelled upon those same failed policies.  It is simply in the assumptions that the Tories make, and which run through their policies, which demonstrate how out of touch they are with the average British citizen today.

Take the Tories announcement on housing policy, for example.  The real problem facing the majority of people today is that they cannot afford the basic requirement for shelter.  At its worst, that is reflected in the 55% increase in the number of rough sleepers since 2010.  Similar rises in all forms of homelessness have been seen since the Liberal-Tories came to power.  It can also be witnessed in the return of the phenomena of Rachmanite landlords, and of the mushrooming of sheds at the bottom of gardens to house people, that is reminiscent of the worst periods of the 19th. century.  But, it is also reflected in the sharp rise in the number of people that are led to rent from private landlords, because conservative policies over the last 30 years (conservative policies pursued by both Tory and Labour governments) have both reduced the quantity of available council housing, and at the same time promoted property price bubbles, that make home ownership unaffordable, and make moving up the property ladder for existing home owners, similarly unaffordable.

But, what is Cameron's response to this crisis, in his new found desire to govern from the centre.  It is not to provide the funds for councils to build hundreds of thousands of new council houses, as even right-wing Tory governments have done in the past.  Quite the contrary, not only is it to place even further restrictions on local councils, and ever higher levels of austerity on council budgets, but it is also to force even Housing Associations to sell off the properties they own!  No wonder, having followed policies that force people into poor quality, expensive, private rented accommodation, Cameron now abuses all those placed in this position, by his dismissive, snooty sneering at "Generation Rent".

In just the same way that the Tories seem to think that the Jobs Fairy will simply come along and provide jobs for the unemployed and under-employed, if only the benefits are removed from them, so Cameron seems to think that the Property Fairy, will come along and provide houses for all those in rented accommodation, if only Housing Benefit is removed from them.  But, its not the existence of Housing Benefit that has prevented people living in expensive, poor quality rented property from buying homes of their own!  It is the fact that the price of such houses has been blown up to astronomical levels by the conservative policies of easy credit that have been pursued over the last 30 years.

But, of course, if you are a Tory that fact is not one you can recognise.  A quarter of Tory MP's are private landlords.  The astronomical rise in property prices is no crisis for them, because it represents a huge rise in their fictitious wealth, which has risen along with the astronomical rise in their fictitious wealth held in the shape of shares, and bonds, and caused by the same easy credit policies.

So, what has been Cameron's new centre ground policy been to remedy this crisis?  He has limited the amount of social housing even further.  In his conference speech, he announced that private builders would no longer have to build a given proportion of houses available for rent in any new development, but would instead be able to produce that proportion as "affordable housing", to be sold at a 20% discount.  And what is the Tory definition of affordable?  In London, it is a house for a first time buyer costing £450,000, and outside London, a house costing £250,000!!!!

In order for a first-time buyer, to buy one of these "affordable" houses in London, they would need to be earning £77,000 a year, or more than three times the average wage.  For someone to buy one of these affordable houses in Stoke, they would need an annual salary of around £40,000 a year, or nearly three times the average wage for someone in the area.  But, why would a party of millionaires like Cameron have any conception whatsoever, about what affordable means for the average citizen today?  After all this is a party one of whose supporters announced prior to the election that she could not find anything other than a decent garage in London, for less that £3 million!

As, Phil has pointed out, Cameron's speech is just hot air.  No one believes that any of the supposed "centre ground" policies and ideas he blathered on about bears any resemblance either to the policies the Tories have actually pursued over the last five years, or the policies they are going to pursue in the next period.  It is as disconnected from reality, as Theresa May's comments on immigration, as though she had not been the Home Secretary for the last five years, or in a different context, its rather like the VW Executives who now act, as though the introduction of cheating devices on their cars, is somehow an accidental occurrence that they now have to remedy!

The reason people are not currently buying houses, and why the introduction of this new gimmick will not change that, is because house prices are currently 400% higher than they should be on any kind of rationality, and past basis.  That means that, for the vast majority they are now unaffordable, and for those who can afford to buy, there is no rational basis for doing so, because such an inflated bubble, must burst sooner or later, which would mean simply throwing money away, by buying at current prices.  The same thing explains why builders will not build more houses.  If buyers cannot afford to buy at current prices, why on Earth would builders build houses they cannot sell at current prices, and on which, therefore, they could make no profit?

The same thing applies with the Tories policies on the removal of Tax Credits.  Marxists oppose things such as Tax Credits.  Marx in Capital Volume I, set out the reactionary and distorting effect that such measures represent.  Analysing the plight of the hand loom weavers, who could not compete with the newly introduced power looms in factories, Marx describes the pernicious effect that such measures, at that time in the shape of Parish Relief, had upon them.  It meant that the hand loom weavers continued to pursue their occupation, supported by such relief, which was taken from the wages of other workers in the Parish, and thereby survived in the most miserable conditions, clinging to a subsistence close to starvation, and often even then falling below it.

"The questions of the Committee of Emigration, and Mr. Turner’s answers, show how the competition of human labour is maintained against machinery. ‘Question: Has not the use of the power-loom superseded the use of the hand-loom? Answer: Undoubtedly; it would have superseded them much more than it has done, if the hand-loom weavers were not enabled to submit to a reduction of wages.’ ‘Question: But in submitting he has accepted wages which are insufficient to support him, and looks to parochial contribution as the remainder of his support? Answer: Yes, and in fact the competition between the hand-loom and the power-loom is maintained out of the poor-rates.’ Thus degrading pauperism or expatriation, is the benefit which the industrious receive from the introduction of machinery, to be reduced from the respectable and in some degree independent mechanic, to the cringing wretch who lives on the debasing bread of charity. This they call a temporary inconvenience.” (“A Prize Essay on the Comparative Merits of Competition and Co-operation.” Lond., 1834, p. 29.) (Capital I, Note 1, p 406)

The use of such welfare benefits not only leaves its recipients in this pauperised, "wretched" and "debased" condition, but it mitigates against the displacement of all of that inefficient capital, that cannot exist without such debased labour, and which thereby prevents that capital being used in more effective, more profitable pursuits, which would enable normal wages to be paid.  The existence of all these in work benefits, be they Tax Credits, Housing Benefit, Child Benefit, along with all of the other bureaucratic fiddles such as subsidised childcare and so on, have the effect both of subsidising underpaying employers, and overcharging landlords, and service providers, whilst increasing the costs of more efficient capitals, who have to pay higher wages, and taxes to cover these state transfers.  It is one reason that British productivity levels are so appalling, and levels of under-employment so high.  It is why there are so many zombie companies (around 160,000) only clinging to survival because of such subsidies, and low interest rates; it is why there are so many households with huge levels of private debt, and dependent upon pay day lenders, credit cards, and other forms of usurious lending.

But, Cameron's policy of cutting Tax Credits, has nothing in common with a Marxist objection to these subsidies to bankrupt capital.  First of all, a Marxist objection stems from an analysis that the problem resides, in the first instance, from the organisation of capitalist production itself, which denies useful work to millions of workers, only on the basis that capital cannot make a profit from the employment of their labour.  But, even from a social-democratic position, i.e. from a position which accepts the continued existence for now, of capitalism, any removal of such benefits, should only be made on the basis of workers' wages being high enough, that such benefits are not required, and that workers who are denied work by capital, should receive a minimum level of income to cover their needs.

Had Cameron announced that his government was immediately raising the Minimum Wage to £20,000 a year, with a minimum monthly wage for each worker of £2,000, irrespective of the hours worked, then a removal of Tax Credits, and other benefits could have been justified.  But, of course, the Tories would not introduce such a policy.  They originally opposed even the introduction of the Minimum Wage, and now their introduction of the National Living Wage, is simply a means of covering the fact that they have cut workers' wages.

The Tories for all their hot air, and propaganda by their media, are as far to the right as they have ever been.  In fact, as Polly Toynbee, pointed out on Newsnight, Cameron is even further to the right than Thatcher, manifest by his ideological attack on the capitalist state, and by their renewed attacks on trade union rights.  Even The Sun, has criticised the right-wing policies of Cameron.  The centre ground belongs currently to Corbyn and the Labour Party.

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