The Political Situation (12/14)
The climax of this appeared to come in 2008. The economic fall-out from what was a financial rather than economic crisis, was severe, and prompted states to have to intervene with large-scale fiscal stimulus, alongside further injections of liquidity to end the credit crunch and collapse of financial markets. But, as soon as that had created a measure of stability, the underlying reality started to be reflected in the realm of ideas, and politics.
In the the US, the further bail-out of the speculators produced a hostile response from both right and left. On the one hand, on the Left, there was Occupy Wall Street, which was a vague, mostly middle-class protest against the state bailing out the rich. On the Right, there was the Tea Party, comprised of the petty-bourgeoisie, and its Libertarian political representatives and ideologues. It also objected to the bail-out of the big banks, and financial institutions, and even more so of the bail-out of the big corporations like GM and Ford. They objected to the massive fiscal stimulus, all of which appeared to them to be an example of Socialism For The Rich, which is seen as simply a forerunner of creeping Socialism itself. The Tea Party Right begins to ensure that Republican candidates are removed unless they commit to scrapping these measures of fiscal stimulus, and this has an effect elsewhere. When the 2010 General Election comes along, the Tories, who had, until then, been committed to, at least, matching, if not exceeding, Labour's spending commitments, having witnessed the success of the Tea Party, switches tack. It moves to a core vote strategy of mobilising its petty-bourgeois base, on the basis of a commitment to implement severe austerity.
Cameron having modelled himself as a Tory Blair, has to suddenly become the later Thatcher incarnate. ( See History Repeating As Farce). Having committed to a pro-European position, and to ending the eternal squabbles over Europe, in the party, he ends up leaving the conservative social democratic, People's Party formation in the European Parliament, and lining up with the reactionaries, and Eurosceptics. As, this collapse of the political centre, reflecting the collapse of the delusion of debt, following 2008, results in growing consolidation of the petty-bourgeoisie around ultra-nationalism, such as the growth of UKIP, Cameron ratchets further to the Right appeasing them with the offer of an EU renegotiation, and referendum.
This represents the fact that, conservative social-democracy has come to the end of the line. The material foundation of its existence has ceased to exist, as the perpetual inflation of asset price bubbles resulted in the 2008 financial meltdown. The reflation of that bubble after 2008 can only be done on the basis of deliberately sabotaging further economic growth by the introduction of fiscal austerity, and that simply further undermines the accumulation of capital required for the growth of profits without which the payment of interest/dividends cannot occur, and so the inflated asset prices become even more surreal. Conservative social-democracy chooses that route rather than an alliance with progressive social-democracy to grow the economy, and promote real capital accumulation, required to produce the profits which are needed to produce the interest/dividends and rents of the owners of fictitious capital. It does so, on the basis of knowing that any resumption of economic growth will result once again, in rising wages and interest rates, which will burst the asset price bubbles once more.
But, having aligned itself with the forces of reaction to that end, it necessarily strengthened those reactionary forces. Cameron no doubt believed that his Popular Front with the reactionaries in his party, would be just a short-term manoeuvre, to destroy UKIP, and thereby, the influence of the Eurosceptics inside his party. Undoubtedly, the conservative social-democrats of the Liberal-Democrats believed that that would be the case, as they joined in that Popular Front, and joined the coalition government, becoming ardent proponents of the fiscal austerity that, during the election campaign, they had rightly proclaimed was economic madness. But, like all Popular Fronts, it simply acted to strengthen the position of the reactionaries, and produced a ratchet to the right. Cameron, as representative of conservative social-democracy, and the interests of the owners of fictitious-capital, undoubtedly saw his manoeuvres in the European parliament as just a clever sop to the Right, as with his commitment to a referendum, which he also no doubt believed a future coalition government with the Liberals would save him from having to actually hold. Having been ploughed into holding that referendum, he also no doubt believed that he would win it, as indeed did pretty much everyone else, including the Brexiteers themselves.
The reality was that the owners of fictitious capital, needed continued membership of the EU, because, whilst they did not want economic growth to be too rapid, as it would lead to rising interest rates, and another collapse of asset prices, they do require membership of the EU and its single market, in order to avoid all of the additional costs that national borders impose; they do need to be part of that larger economy to obtain economies of scale, and all of the social-democratic features of planning and regulation required for capital accumulation on today's mammoth scales. The owners of that fictitious capital, and the conservative social-democrats that are their representatives have created a dilemma for themselves as a result of their alliance with the forces of reaction, and as a consequence of their own hubris.
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