Keir Starmer has come out to complain about the rocketing cost of living, and increased tax burden. It is sheer hypocrisy, and opportunism, because that rise in inflation and debt is a consequence of the policies that he, and others like him, have been advocating over the last two years and more.
The immediate cause of the sharp rise in the cost of living is the policy of lockdowns imposed by governments over the last two years. That policy seriously reduced the supply of goods and services, and created shortages in supply chains, bottlenecks, and increased costs and frictions. The shortage of supply is a direct result of governments preventing workers from working as a result of lockouts and lockdowns, and, because governments could not avoid taking responsibility for preventing workers from working, and businesses from functioning, they also found themselves having to take responsibility for paying people's money wages, and other incomes. The combination of reduced supply of goods and services, together with, at least, maintained levels of monetary demand, as the government printed money tokens to pay out these replacement incomes could have no other consequence than to lead to inflation, and that is exactly what is now seen.
But, it was Starmer who wanted lockdowns implemented sooner, more extensively, and for longer. It was Starmer who wanted more generous furlough payments and replacement incomes and so on. So, it is Starmer, if anything, who bares greater responsibility for the rise in inflation than Johnson and the Tories.
And, the same is true in relation to taxation. The same factors that have led to soaring levels of inflation are the same factors that have led to astronomical levels of debt. If you prevent workers from working, as a result of lockouts and lockdowns, you prevent new value being created by those workers, and so also prevent new surplus value being created. Tax is a deduction from surplus value, and so if you prevent new surplus value production, you prevent tax from being deducted from it. The manifestation of that is wages are lower so that income tax is reduced, profits are lower so Corporation Tax is lower, sales are reduced, so VAT is lower.
At the same time, Starmer wanted much more generous payments of furlough and other income replacement schemes. So, at the same time that the basis of tax was being reduced, the need for government spending on all these other things was expanded massively, so that government spending rose astronomically at the same time as its income was reduced. It could respond in only one of three ways. It could have increased taxes, which would have simply caused economic growth to have collapsed even more; it could borrow, which it did, which then causes interest rates to rise, with taxes having to rise later to pay back the debt; or it could print money tokens, which it also did, which then causes inflation, which also leads to interest rates rising.
And so, the economic state of the country is as a much a direct result of the policies in relation to lockdown and lockouts promoted by Starmer as they are the responsibility of the Tories. In fact, if Starmer had had his way, and lockouts had been imposed sooner, harsher, more extensively and longer, and pay outs had been more generous the levels of debt and inflation would be even worse.
And, of course, its not just in relation to lockouts and lockdowns that Starmer and the conservative social-democrats of the PLP bear responsibility. Inflation and debt across the globe resembles what exists in Britain, because the same kind of idiotic policies of lockdowns and lockouts have been imposed in other countries. But, Britain is worse, because of Brexit. Brexit has put all of the above factors on steroids. It has worsened labour shortages, due to the ending of free movement; it has increased costs, because of all the added bureaucracy and red tape, and other frictions arising from imposing borders where none previously existed. But, Starmer and the Blue Labour nationalists of the PLP have become even bigger supporters of Brexit than even Johnson. They have urged him on to get Brexit done, more quickly. They, now, offer no alternative to the sovereigntist, nationalist positions of the Brexiteers, and the reactionary petty-bourgeois that stands behind them.
But, they bear a wider responsibility too. The roots of the present inflation and debt go back 30 years to the time that Thatcher in Britain and Reagan in the US began the process of prioritising the inflation of asset prices and financial and property markets over the real economy. They created the mentality that it was the inflation of these asset prices that represented national wealth. That delusion was continued not only by Major, but even more by Blair and Brown. The inflation of commodity prices, of the cost of living now, is only the inevitable consequence of decades of money printing that has reached its limits in terms of inflating asset prices, and has surged out into the inflation of commodity prices. Starmer and the conservative social democrats of the PLP have not budged from that approach, and bear equal responsibility for it.
Finally, Starmer has been a prominent advocate of NATO imperialism's economic and military war against Russia and China. The immediate consequence of that has been a further increase in costs, most notably the costs of energy, food and raw materials. All of that has played into supply shortages and massively rising costs of living. NATO's war against Russia and China is again typical. Socialists too would like to see the back of dictatorial and vile regimes such as those of Putin and Xi. For more than a year, I have been writing that, after Trump's demise in the US, the US state would turn on the fascistic elements behind him, as well as their international allies such as Putin, le Pen, Orban and so on. But doing so by means of an increasingly hot war, rather than an open political struggle, is again typical of social-democracy, and particularly conservative social democracy.
In the US, Biden has been useless. No political war against the ideas of the reactionary petty-bourgeoisie that stands behind Trump has been waged. He has continually appeased the right-wing of his own party such as Manchin, whilst constraining the Left, in exactly the same way that Starmer has done in Britain. In both cases, the core of both the party and its voter base is demobilised and demoralised, opening the door to reactionaries, which should have been well and truly shut. In both cases, the reactionaries - Trump and Johnson - look set to prosper in forthcoming elections, when they should have been politically destroyed.
It is a repeat of what happened to Clinton and Blair, but has happened so many times in the past, when social-democrats have simply failed to undertake an open and militant political struggle against the petty-bourgeoisie and its reactionary ideas. Wilson/Callaghan, Carter, Mitterrand, Hollande and so on, all bear the same marks, and the same can be found of social-democrats across Europe, in many cases leading to the social-democratic parties being destroyed as with PASOK, or now the French Socialists. Macron was just Blair by another name, and quickly failed, his support plummeting. Now, it looks like the biggest winner in the French elections will be apathy and abstention, though, on that basis, the real winner is already the far-right.
In Hungary, the strategy of Paul Mason of an electoral Popular Front to oppose Orban was adopted, and as was expected failed miserably, because, as is always the case with such lesser-evilism, the lesser evil presented no attractive alternative to Orban, and every reason for progressive voters to simply say a curse on both your houses, leaving the hard core of the far right to turn out and win. But, the far right is winning across Europe, again, because, social-democracy has not only offered no attractive alternative, but has again allied itself with NATO imperialism, in the war against Russian and Chinese imperialism, and it is the working-class that is paying the cost of it.
One French voter summed it up by saying, as the cost of living rose, the poor were being protected because of welfare payments, and the rich were able to continue to live well, but it was those in the middle who faced higher taxes to cover the higher welfare payments, and so on, as well as having to cover the higher cost of living. And, that is fundamentally true, because that is the way social-democracy always deals with such situations, rather than dealing with the underlying class contradictions.
The war in Ukraine is just an extension of the Bonapartist methods of social-democracy, which rather than engaging in an open political struggle against petty-bourgeois reaction, which would involve mobilising the working-class itself, instead looks to the capitalist state to fulfil that function.
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