NATO Using Depleted Uranium in Libya

According to an article on RT (video below) NATO is using depleted Uranium munitions in Libya.

NATO denies that. However, one US specialist, who was interviewed, dismisses their denial saying that some of the weapons platforms being used only use depleted uranium munitions. Moroever, he states, the pictures of the tanks and other equipment, that have been hit, bear clear signs of being hit by depleted Uranium munitions. When it explodes, it does so at very high temperatures, which melt 4 inch thick armour plating like butter, that enables the munitions to cleanly penetrate the armour leaving a distinctive single entry point.

It is not just the radioactivity of depleted Uranium that is the problem with it.

The real problem is that, when it explodes at these very high temperatures, it turns into a fine powder. The powder then disperses into the air to be breathed in, or else it settles into the ground, finding its way into water courses, and the water table, and consequently being ingested. As a heavy metal, it is very toxic, causing cancers and other health problems, such as birth defects. Once again, as with other instances of imperialist intervention, it appears that the consequence will be not just large numbers of civilian casualties in the short term, but a long term legacy of death, destruction and misery, long after anyone is thinking about why the intervention occurred in the first place.

Northern Soul Classics - Philly Dog - Herbie Mann

During the 1960's there were a plethora of new dance crazes - the Shotgun, the Duck, the Monkey, the Jerk, the Twine to name but a few. Each has their own song/s.

This is one of them. I have two versions of Philly Dog, both from Stax. This one, and one by the Mar-Keys, which was one of the names the Stax houseband used depending upon its composition at the time. The sound quality isn't brilliant on this video, but its better than on the other one I could find.

Herbie Mann's version is the preferred Northern rendition. Herbie - real name Herbert Jay Solomon - was a Jewish flautist who covered a whole range of musical styles. As with the modern jazz of Ramsey Lewis, or the contributions even of artists better known for being County singers such as Roy Hamilton, it shows that Northern Soul itself covers a wide range.

Ebb & Flow In Egypt - The Beginning Of Repression By The State

Revolutions never proceed in a linear fashion. In Egypt, for years it was workers who resisted the regime at a low level with repeated strikes and industrial action, as they attempted to use their only weapon – withdrawal of their labour power – to mitigate their condition, and attempt to defend their wages and working conditions. As always it was the workers in the larger enterprises who were both better placed to organise, and better placed to win concessions from their employer, which was itself often the Egyptian Capitalist State.

It was a high point of such struggles, the strike of the Mahalla textile workers on April 6th 2008, which provided the impetus for students, and other petit-bourgeois elements to organise later for their own interests and demands, taking them out into the streets, and into Tahrir Square.

In January 2008 Mahalla workers drew up a list of demands. It included higher wages, bonuses and allowances, and indicating that they were looking beyond their own sectional interests to broader class interests it included a rise in the national minimum wage from 35 Egyptian pounds to £E1200 ($212) a month. It had not gone up since 1984. They announced a strike on April 6th if their demands were not met.

A few weeks later opponents the Mubarak regime called for a general strike on that day. The call was not made by organised groups of workers but was supported by some small opposition parties, intellectuals, some youth and radicals. The call for a General Strike spread over the Internet and via mobile phones. More than 65,000 joined a Facebook site promoting the strike. By its nature this was almost entirely a movement of middle class youth, but as so often in the past they were being given confidence and inspiration by the example provided of working class power.

The Interior Ministry warned people off with the usual appeals to the need for Order. In the event, a general strike did not take place. However, thousands of workers did take strike action.

In Mahalla, some of the workers’ leaders, who had played a leading role in the previous strikes, called the strike off after the monthly food allowance was doubled on April 5th. The strike had been due to start at 7.30am but at 3am hundreds of plain-clothes security moved in to the factory and arrested anyone who tried to speak out. Despite this many stayed away from work.

On April 7th. a demonstration of 2,000 started at 4 p.m. and grew to several demonstrations with up to 40-50,000 involved. Anti-government slogans were raised along with demands for the release of those arrested the previous day. Children were throwing stones, at the Security Forces and soldiers, and chanting ‘The revolution has come! The revolution has come!’

On April 8th. the Prime Minister, Ahmed Nazif, announced a bonus of 30 days wages! Following this the regime was less confident to crack down on workers in the way it did on students, community or democracy campaigners, and it is no coincidence as I pointed out in my blog Military Coup As Egyptian Workers Appear On The Stage that it was at the point when workers once more began to flex their muscles that the Generals moved in their Coup to replace Mubarak.

In fact, what we see developing is something that is quite common in revolutionary upheavals. Firstly, we see different social groups having different objectives. The workers who began the movement, were concerned with immediate economic concerns. Looking back to when these disputes began around 2006, it was precisely at that point, around 7 years into the new Long Wave Boom, where the economic tide had had long enough to begin to significantly raise the demand for labour-power. Trotsky, who had begun to analyse the effects of the Long Wave as described by Kondratiev – though Trotsky disagreed with Kondratiev in terms of method and detail – spelled it out,

“But a boom is a boom. It means a growing demand for goods, expanded production, shrinking unemployment, rising prices and the possibility of higher wages. And, in the given historical circumstances, the boom will not dampen but sharpen the revolutionary struggle of the working class.

This flows from all of the foregoing. In all capitalist countries the working-class movement after the war reached its peak and then ended, as we have seen, in a more or less pronounced failure and retreat, and in disunity within the working class itself. With such political and psychological premises, a prolonged crisis, although it would doubtless act to heighten the embitterment of the working masses (especially the unemployed and semi-employed), would nevertheless simultaneously tend to weaken their activity because this activity is intimately bound up with the workers’ consciousness of their irreplaceable role in production.

Prolonged unemployment following an epoch of revolutionary political assaults and retreats does not at all work in favour of the Communist Party. On the contrary the longer the crisis lasts the more it threatens to nourish anarchist moods on one wing and reformist moods on the other. This fact found its expression in the split of the anarcho-syndicalist groupings from the Third International, in a certain consolidation of the Amsterdam International and the Two-and-a-Half International, in the temporary conglomeration of the Serrati-ites, the split of Levi’s group, and so on. In contrast, the industrial revival is bound, first of all, to raise the self-confidence of the working class, undermined by failures and by the disunity in its own ranks; it is bound to fuse the working class together in the factories and plants and heighten the desire for unanimity in militant actions.

We are already observing the beginnings of this process. The working masses feel firmer ground under their feet. They are seeking to fuse their ranks. They keenly sense the split to be an obstacle to action. They are striving not only toward a more unanimous resistance to the offensive of capital resulting from the crisis but also toward preparing a counter-offensive, based on the conditions of industrial revival. The crisis was a period of frustrated hopes and of embitterment, not infrequently impotent embitterment. The boom as it unfolds will provide an outlet in action for these feelings.”

Flood Tide

That is what has been seen in every instance of the Long Wave Cycle. It was what led me to be confident in the prediction back in 2005, and to repeat in a blog in 2007 Prepare To Dust Off the Sliding Scale,

“I think all of these elements can be identified in the present conjuncture, and that should give confidence to Marxists that once more the conditions are developing for militant working class struggles. How these struggles manifest themselves will differ.

In China wages are rising by 10% plus per year, and there are clear signs that Chinese workers are beginning to become more organised. The same is true of workers in South Korea and other rapidly growing Asian economies. Under these conditions workers struggles are likely to take on increasingly an offensive nature.”

In more recent months I have pointed out that Egypt along with Turkey is one of those economies that has industrialised and developed rapidly enough in the last decade or so, to be listed by Goldman Sachs and others as one of the “Next 11” group of economies after the BRIC economies of Brazil, Russia, India and China.

Part of the reason for its economic development has been a need to focus on industrialisation given its lack of the oil resources of other Middle eastern countries, and its integration into the Mediterranean Economic Area, and trading relations with EU countries through that relation. That together with the size of the working-class that goes with it, the relatively high levels of education and other social development, means that Egypt probably more than any other country currently undergoing social upheavals is the most likely to be able to throw off the chains of the Bonapartist regime and move forward to some form of bourgeois democracy. Indeed, it is that which has brought the bourgeoisie, and sections of the radical bourgeoisie out on to the streets.

As I wrote in my blog Egypt – What Is To Be Done, we have seen this before in 1848, and in other democratic revolutions. In many of those Revolutions, the bourgeoisie and petit-bourgeoisie, once the workers began to advance their own separate interests took fright.

They lined up with the existing rulers, and suppressed the workers often in the most bloody manner, only then to find themselves being suppressed by the State. It was this that led Marx and Engels to develop the idea of the need for a permanent revolution, a revolution by which the workers themselves would have to concentrate on developing their own organisation, property, democracy and forms of State, and to counterpose these when they were strong enough both to the old regime, and to the bourgeoisie.

But, as I pointed out in those posts, the situation in Egypt is not the same as that analysed by Marx, or the situation analysed by Trotsky in Permanent Revolution. In Egypt it is not a Landlord Class or Colonial Ruling Class that holds state power.

It is the Egyptian capitalist class. A democratic revolution is required in Egypt not to establish a Capitalist State, but in order that the Egyptian bourgeoisie can wrest direct political control of its state back out of the hands of the Bonapartist Military-bureaucratic elite that has seized it on the back of the weakness of the bourgeoisie. It is for that reason that the extent to which the Theory of Permanent Revolution applies, depends upon the extent to which that elite fights to hold on to power. If it goes relatively quietly, then a transition to bourgeois democracy may be effected without the need for the bourgeoisie to mobilise the working-class without which it lacks the numbers and social power to overthrow an entrenched State power. Under those conditions, especially if it were supported by Imperialism with aid, such a regime could buy off the workers via some form of Social Democratic consensus. If the regime resists, then in the course of the wider social mobilisation against it, rather like in Libya, then at some point the workers will begin to advance their own interests, and the bourgeoisie will draw back, line up with the forces of reaction and crush the workers.

Its for that reason that in both Egypt and Libya, it is necessary for the working class to maintain its independence from these alien class forces and to concentrate on building up its own forces and means of defence. It is for this reason that those within the Labour Movement who advocate some kind of Popular Front with those forces, advising the workers and socialists to only raise their own demands after the existing regime has been overthrown, are betraying the working-class, and leading them into mortal danger. Still worse are those who mislead the workers into a belief that Imperialist intervention could be in their interests.

Early on in the Egyptian Revolution, the BBC and other media were advising the protesters to go back to work and clear the streets after Mubarak stood down.

But, as I pointed out Egypt what Is To Be Done, if they did demobilise it would mean the end of the revolution. The concessions would be replaced with repression. In the last few weeks without much coverage in that same western media that has instead been focussing on atrocities in Libya, that change has begun to develop in Egypt. There were reports coming out that the regime had been negotiating with the Muslim Brotherhood to introduce limitations on who could be termed Egyptian, and claim the right to vote. Other concerns arose as it became clear that various regulations and measures were being put in place, which would ensure that the old regime could still control the new parliament. This came as the Egyptian workers were increasing their organisation, and it appeared that the younger members of the Brotherhood were being won away towards socialist organisations.

The change was symbolised when the military, which had refrained in large part from intervening during the demonstrations in Tahrir Square, began to act against protesters, for example, when they tried to storm the Interior Ministry where they believed that secret files and records documenting torture etc. were being destroyed.

Now Channel 4 News has highlighted, the fact that the Military are now acting against sections of the protesters, and many of them have disappeared, as well as many others having been seized and subjected to beatings and torture. Some of this is highlighted in the video below.



Further details are to be found at the website Channel 4 News.

Once again this highlights the lunacy of those who want to tie the workers hands by limiting their struggle merely to bourgeois democracy, let alone who want to tie the workers to the fortunes of alien classes, or to rely on the good will of Democratic Imperialism. As I said in my blog Egypt – What Is To Be Done,

“In short, there are a number of principles which must govern the actions of the Egyptian workers if they are to avoid the mistakes of the past. The most important of those is for the workers to maintain their strict independence from other classes, supporting them in action in the struggle for Democracy, but using their own methods of struggle for that, and developing their own organisations and demands alongside it.

They must maintain a position of “extreme revolutionary opposition”, supporting the Democracy movement in action, but all the time stressing the separate interests of the working-class, and its ultimate hostility to the bourgeoisie. It must focus primarily on the goal of developing the working-class, and the fight for Socialism rather than subordinating that to the immediate concerns of the struggle for democracy. It must build the strength of the working-class from below. The socialists must conduct mass work on the shop floor and in the workers communities, concentrating on the building of Rank and File Organisations from the bottom up, as the only sound basis for winning positions. Until such time as the socialists have successfully conducted that struggle and won the battle for democracy they must avoid any premature bid for State power...

The fate of the Egyptian workers lies in their own hands, and they can by organising to fight for their interests here and now, transform their condition, and can become the most important force in Egyptian society as a result of their actions.”

For now that will mean the workers raising demands for the release of all political prisoners, and an end to detentions and beatings. But, it also shows why Marxists in Egypt must convey the message of no trust in the Generals or Military, and begin to build their own structures of workers' democracy in the factories and communities. More than ever it shows the need to build Workers' Militia.

What Happens When The Debt Crisis Really Does Hit Britain

Once again, George Osborne has been busy with the kind of scaremongering, and talking down of the UK economy that sent it into a tailspin last year. At the beginning of 2010, Osborne, as part of the Tories Election Campaign, began to come out with the most ridiculous scare stories that put Britain on the same kind of level as the basket cases of Europe such as Greece.

From an Economics standpoint it was illiterate. There is, of course, no comparison between Britain and Greece, or between Britain and Ireland, or Britain and Portugal. Britain is more akin to Japan, which also has a huge fiscal deficit, has had one for the last 20 years, and yet, which still has record low interest rates. Japan's deficit like Britain's are largely composed of long term debt, and most of it is owed to Japanese citizens, not to foreigners.

Japan like Britain has control over its own interest rates, and currency. The main difference between Japan and Britain is that Japan has a large trade surplus.

Right up to the time of the Election the Liberals were opposing the Tory plans for Cuts. As I pointed out in my blog Liberal Economy With The Truth, in an interview with Sky News Deputy Political Editor, Joey Jones, David Laws confirmed that the deficit was being hyped up.



In fact, as I also pointed out in my blog Cuts Inflation & Interest Rates,

“Yet, even in the area that the Liberal-Tories placed most of their attention in justifying the need for immediate deep Cuts, their narrative has collapsed. In January 2010 the UK was paying less than 4% on its borrowing via the Ten Year Gilt. That figure continued to fall from that figure even prior to the Election. The Liberal-Tories attempted to claim credit for this falling Yield, saying that it was a consequence of their Cuts agenda. But, the FT last weekend had a chart (page 23) showing that, in fact, having fallen from a level of 3.6%, down to 2.9% in July, the yield on UK 10 Year Gilts then rose fairly steadily to around 3.7%, where it currently sits. That is a 25% increase in yield from just after the Liberal-Tories Cuts Budget was announced in June, and is consistent with the rise in yields on the Bonds of other countries that have initiated similar policies in Ireland, Greece, Spain and Portugal. The conclusion is that either the Big Capitalists and Financial Institutions who buy these Bonds believe that the Cuts will be detrimental to their interests, or else as Ed Yardeni put it, they simply don't believe Governments will make the Cuts,”

And today, after a year of Liberal-Tory Government, and economic policy the Yield on the UK 10 Year Gilt stands not at the 2.9% it had fallen to as a result of Labour policies, but at 3.79%, having risen earlier to 3.85%! In fact, contrary to the argument that Osborne was making today that Portugal applying for an EU Bail-out justified the Liberal-Tory policy of Cuts, the opposite is the truth.

One after another, economists and analysts on CNBC and other business channels have pointed out that the real problem for Greece, Ireland and Portugal is lack of growth. The ausetrity measures they had already put in place before they had to seek a bail-out had not worked. They had made things worse. Now, even with the bail-outs, these economies are being asked to cut even more, further reducing the potential for growth, whilst at the same time being asked to pay exorbitant interest rates as part of the bail-out to the EU.

On what rational basis does it make sense that economies already in trouble should be asked to pay 6,7 or 8% interest rates compared to the 3% being paid by Germany? The whole point of these economies being part of a single economic bloc, a single market, a single currency area, and giving up control of their interest rates and currency was that they should be able to enjoy the same borrowing costs etc. as the more propserous economies!

As I have pointed out before, in fact, Portugal has not faced the same problem as other PIG economies. It did not run up a large deficit on the back of increased Public Spending, and borrowing on the back of an asset bubble as did the US, UK, Spain, Ireland etc. Portugal's deficit results simply from the fact that its economy lacks the dynamism and resources to grow rapidly. Trapped within the Eurozone, with first interest rates, and a currency that were too high, and then suffering from the effects of the Credit Crunch and downturn of the European economy, it simply found that it could not pay its way in the world. It had to borrow simply to survive. Had it been able to borrow at the same rates as Germany, and to use that borrowing to finance investment in its economy that was needed, it might have created the potential for growth that would have enabled it to pay its way, and thereby avoid a worsening deficit.

The lesson from that for Britain should be clear. The UK economy was de industrialised under Thatcher during the 1980's, as British Capital found that it could make much higher rates of profit locating production in low wage economies overseas, particularly in Asia.

To keep the economy going, and to avoid the kind of social explosions that began to arise in the Inner Cities as real wages began to fall, British Governments from the late 1980's opened the monetary spigots even wider, and financed a credit bubble that gave the impression that living standards were rising by replacing wage rises with the ability to borrow, large amounts at low interests rates. This explosion of the Financial Sector of the economy, of fictitious Capital, went hand in glove with the Big Bang in the City, which made London the world hub of the Financial Services industry, and led to an unhealthy reliance of the British economy on Financial Services. That is why when the Financial Meltdown came, Britain was particularly badly hit. This was part of a long term change and decline in the British economy as set out in my blog Answering Cleggy's Questions.

Britain now needs to restructure its economy, and that implies lots of investment in new types of productive capacity, particularly in high value production, and that also requires large amounts of investment in infrastructure – the plans to introduce “high-speed” broadband, for example are a joke, by the time they are implemented they will be ten years behind what some economies such as South Korea and Singapore already have today, the plans for “high speed” rail will be equally out of date by the time they are implemented – and in education and training of workers. Yet, the reality of the Liberal-Tory policies is the exact opposite. It will mean an increasingly uncompetitive economy, and an increasing impossibility of covering the deficit or interest payments.

When the Liberal-Tories came to power, the economy was growing as a result of the fiscal stimulus introduced by Labour. The recovery appeared to be strengthening in the same way that such policies had had that effect in the US and elsewhere. The consequence was that unemployment was falling, and with it the deficit was being reduced, borrowing coming in lower than had been anticipated. Interest rates, as indicated earlier, were low and falling. But, the effect of the Liberal-Tory scaremongering and talking down of the economy soon had its effects on what Keynes called the “animal spirits”, the psychology that affects consumers, and investors.

Having been told how dire things were by the Liberal-Tories consumers believed them, and acted accordingly. They pulled in their horns, and began to spend less, and save more, worried that tomorrow they might not have a job – a likely prospect if they worked in the State Capitalist sector, or in an industry dependent on it. Businesses began to do likewise as they saw consumers spending less.

The Bank of England had attempted to do what it could to persuade people to keep spending, by going even further into debt – despite the fact that the Liberal-Tories kept up the narrative that the problem had been caused by too much debt, and the country maxing out its credit card. The Bank's Deputy Governor, Charlie Bean, admitted that the reason for the maintenance of such ridiculously low interest rates, despite inflation soaring to more than twice the target rate, was to persuade people there was no point in saving, and that they should spend their savings.

But, as the animal spirits began to feed into that area of the economy that had bubbled up more than most, and financed the continuation of spending by equity release – the Housing Market – with month after month declines beginning from the second half of 2010, it became clear as I pointed out in my blog Why Charlie Bean Could Be Disappointed, that there was a considerable incentive for consumers to save as much as possible even at such low interest rates, because measured against falling house prices, that were declining by 1% or more a month, the value of money against property was rising very rapidly.

It seems inevitable now that the next domino in the line to fall – Spain – will begin to come into the firing line very soon. Unlike Portugal, it did run up a big deficit on the back of a ridiculously huge property bubble that has yet to burst, despite more than a million empty properties overhanging the market.

Like the rest of the Spanish economy it is being maintained on the back of a fiction. The Spanish regional banks, the Cajas, are massively exposed to a fall in the Spanish property market. If the properties on its books were valued at anything approaching a realistic level, most of them would already be bust. The Spanish Government has been attempting to rescue this situation by encouraging them to merge, and is proposing to nationalise some of them to ensure that they are recapitalised.

In other words a re-run of the situation in Ireland prior to it going bust. Some of the proposed mergers of the Cajas have already foundered. The big Spanish Banks, which have considerable exposure to the Portuguese Banks – one reason Portugal was encouraged to seek a bail-out before they went bust taking some bigger European Banks down with them – are also massively exposed to the Cajas. Today's rise in the ECB Interest Rate could be the first step in the collapse of the Spanish Banking system. First will come a collapse in the Spanish property market as the bubble bursts. That will collapse many of the Cajas, which have to be nationalised or taken over by the larger Spanish Banks. Those Banks will attempt to do that rather than see their loans to those Cajas disappear, but that will probably just lead to the collapse of those larger banks, or at least the need for them to be massively recapitalised, which could only be done by the kind of State intervention seen in the UK, US, Ireland and so on.

But, this would be from a Spanish State already facing huge questions over its own creditworthiness. It is in the context of a Spanish economy that is likely to be contracting due to its own austerity measures, and which already has more than 20% unemployment, and more than 40% youth unemployment; the kind of figures you get in a Depression!

But, in reality the UK does not face this problem. Because Spain does not control its own Monetary Policy it cannot simply print money to cover these debts. The UK can. The problem for the UK is not Public Debt, but Private Debt. As I pointed out in my blog, UK Debt The Facts, private debt, the debt that every individual racks up on store cards, credit cards, student debt, mortgages and so on, is TWICE the figure for Government debt. Unlike the Government, which can simply print more money to cover its debts, individuals cannot do that without risking a long gaol sentence. But, more than that, what the Liberal-Tory Government's policies amount to is not reducing the amount of debt, but simply transferring Government debt to individual private debt. The Government is reducing some of its spending by reducing the wages and pensions of Government workers.

But, in so doing it means that those workers have to increase their own debt to retain the same standard of living. The same is true with the increase in Tuition Fees, and so on that transfers the Government's debt on to individual students. The Cuts in services mean that individuals will now have to buy them, and if they are already at the limit of their budget they will have to borrow to finance them. The same is true with the reductions in Benefits and Tax Credits.

So we already have a massive amount of private debt built up at least over the last 40 years as a result of the loose money policies of successive Chancellors after Tony Barber, that was encouraged by Governments to mask the stagnation in real wages.

That private debt, already standing at twice the Government debt is about to get much, much bigger as most analysts have indicated. It is doing so at a time when global interest rates, including the interest rates in the UK are rising. It has been illustrated by the fact that some fixed rate mortgage products have already disappeared, and Banks and Building Societies are demanding much higher deposits, and interest rates. It is being indicated by the steady rise in home repossessions and the rapidly rising number of people in arrears on their mortgage payments. A similar sharp rise in the number of people who say they cannot get to pay day before their money runs out has been recorded.

I was told the other day about a house repossession where the Bank had auctioned the house for £79,000, it having been bought only two years ago for £130,000. Another identical house in the same street sold recently for £118,000.

That is an indication of what happens when forced sales begin to rise, and the more such a firesale takes hold, the more rapidly prices collapse as happened in Ireland over the last year where prices fell 60%, or as happened with the rise in interest rates in the UK in 1990, when house prices collapse by 40%. As I've pointed out before on any measurement, UK house prices are massively overpriced. On a long term basis, the usual relation between wages and house prices is 3.5. Today it is more than 5. That implies that house prices would have to fall by around a third, or wages would have to rise by about 40%!!! But, in fact, the real relation has to be with take home pay, or disposable income, and in the current conditions that is going to be falling not rising. For large number of people thrown on to the dole as a result of the Cuts, things will be even worse. Using another metric, its been calculated that over a long period house prices rise by 4% p.a. Taking a three bedroom detached house that I know was bought for £2,000 in 1960 that would mean that today its price should be around £15,000.

In fact, its today valued at around ten times that! Finally, as I have shown previously taking the figure just since 1970, on an inflation adjusted basis, house prices today are around four times the figure they should be.

The debt crisis that has swept through one European economy after another will come to Britain. But, it is not the Public Sector deficit that will prove to be the problem, but the debt of millions of individuals. It will lead to mass defaults on credit cards and store cards, with huge implications for the banks and financial institutions that stand behind them. But, the latest figures also show that the economy having shrunk in the final quarter of 2010 has not recovered. Retailer after retailer has announced large falls in their sales and profits.

Analysts are talking about a year long sale, as retailers try to get customers in through the door. Many look set to go bust, and as I said recently some of them, such as Dixons are already blaming Government economic policies for the situation. But, the long expected and awaited crash of the property bubble must follow as sure as night follows day. I'd expect prices to fall on the above figures by anything between 75% and 90%, and that will have huge consequences. It will affect many of he calculations that Government has made about extracting wealth from people in old age to cover nursing care. It will mean that the Banks and financial Institutions will get hammered, and require the Government to pump even more money into them, having to print huge amounts of it to finance the operation. And under those conditions of another round of “Socialism For the Rich” as the Capitalist State bails out the banks, it will become impossible to insist on yet further austerity measures, or else widespread social unrest is inevitable. But, the other consequence is that for the first time in at least a generation, it will become possible for ordinary workers to be able to afford to buy a house.

In fact, out of that destruction is likely to come the basis of recovery.

Northern Soul Classics - Do I make Myself Clear - Etta James & Sugar Pie Desanto

Etta James is awesome.

Typical Northern soul power and grit as demonstrated in the previous offering from Etta I featured - "Seven Day Fool", which I am adding as a bonus below - and by her much used on TV ads version of "At Last". Here Etta is perfectly matched with Sugar Pie Desanto. I remember first hearing this when I was about 8 years old, on a tape on my sister's reel to reel tape recorder.

If you listen to this and it doesn't move you, if you don't feel the need to get up and get your groove thang on, then you really do have a hole in your soul.

Enterprise Zones - Part 4

On Wednesday, I heard Joan Walley ask a question at Prime Minister's Question Time, imploring the Prime Minister to look at establishing an EZ in Stoke. I have known Joan going back to the Miners Strike in 1984. She has the best interests of workers at heart. But, the reality is that what such an appeal amounts to is this. Stoke is characterised by its very low wages, and poor working conditions, as well as its history of poor educational achievement, and low levels of aspiration.

What the request for an EZ in Stoke amounts to is a request for the introduction of even more abysmal levels of all these things! The whole purpose of an EZ is to allow bad, or cheapskate employers to get away with paying even more abysmally low wages, to escape even the very limited employment regulations imposed upon them to protect workers, and to get away with this on the basis of employing workers who have little hope for the future!

The same was true in the 1980's. At a national level the NEC eventually came out with what was a relatively good statement. In August 1980, it produced the following.

“Britain at the time of the Industrial Revolution was the original enterprise zone, and it was the resultant human misery which was one of the main spurs of the Trades Union movement...the Labour Movement has in turn striven for years to rid the country of the pollution of our social lives that was caused by this 'enterprise zone'. We do not look with favour on its return”

(NEC Home Policy Statement)

But, the function of the policy as an ideological battering ram, able to divide the Labour Movement soon proved its worth. Shutt quotes Michael Brown MP for Brigg & Scunthorpe.

“Will my right honourable friend acknowledge that Labour controlled local authorities recognise that enterprise zones will be able to play a part in the regeneration of British industry?”

That provided Environment Secretary, Michael Heseltine with a perfect opportunity to reply.

“My right honourable friend raises an interesting dilemma for the Labour Party. While on its national platform it decries enterprise zones, when it comes to the real world, Labour authorities apply for them.” (Hansard, 15th November 1982)

In fact, there were only a few Labour Local Authorities that did not apply for or accept EZ's. All of them took part in the establishment of SRB areas that put them at the mercy of central Government to control their Capital Spending, and acted to divide Council Wards, and therefore, their Councillors one against another. It was a perfect utilisation of divide and rule tactics to weaken Local Authorities prior to the real assault upon them, and to prevent any possibility of any kind of united fight against the Tories Cuts.

But, they had a further function in acting as such a battering ram for capital. In their opposition to the EZ in their area, the Chairman of the West Midlands Regional Group of Chambers of Commerce, said,

“If this experiment is successful, then the lessons that have been learned should be applied to industry and business generally, and not just to the pre-selected sites dotted around the country. Acceptance of this view would see especially a firm ceiling to the rate liability on industry and commerce.”

Shutt quotes Doreen Massey, who wrote,

“it is not too much to claim that the enterprise zone idea helped to create the political space for the major attack being waged by the Conservative Government and much of industry on local revenue raising and local services.”

(Doreen Massey, ' Enterprise Zones:A Political Issue' International Journal of Urban and Regional Research, Vol. 6, No.4, pp. 429-434)

Part of the strength of the idea for the Tories was that in many ways it fitted neatly with the ideas of Social Democracy, which cannot see any means by which the interests of Labour can be furthered without at the same time, indeed as a consequence of, the furthering of the interests of Capital. If EZ's increased business activity, then this was seen as necessarily good. It was not just the Labour Party that at a local level adopted this approach. In Salford, the Labour Party in its 1982 Manifesto wrote,

“A programme to develop the docks area as an Enterprise Zone will be pursued vigorously. This will transform an industrial wasteland into a floursihing site, bringing hundreds of new jobs to Salford.”

(Salford Labour Party Manifesto 1982)

I can remember myself as a City Councillor in 1983, at every meeting of the Labour Group in Stoke, putting forward amendments to every decision to provide economic assistance to small firms, to the effect that such support be dependent upon the firm recognising and encouraging its workers to join a Trade Union. At that time not only was it a requirement for all LP members to be a member of a TU, but nearly all of the leading Councillors were TU activists themselves. Yet, every time, the amendments received the same handful of votes in support from the hard left caucus within the Group. But, it was not just at a local level that the Trades Unions attitude towards the EZ's was weak.

The TUC itself accepted the basic ideology about the need to provide incentives for small businesses to encourage them to exploit workers. Their only objections tended to be to present the argument that such employers would be anti-union.

The EZ's in the 1980's did not provide any solution to the problems of Britain's decrepit Capitalist economy, could not provide any answer to the rapid de-industrialisation under way at the time, as jobs flooded to rapidly developing, low-wage, and dynamic economies in Asia. They were themselves dependent upon not only large amounts of money from the Capitalist State in order to establish them, but also required considerable intervention by the Capitalist State in other ways, for them to function. But, they did not even succeed in providing any new jobs within the backward, inefficient, small capital sector they were aimed at.

They only succeeded in persuading some of these employers to move their operations from outside the zone to inside, thereby in themselves distorting the local market, and hence the objections to them even from small business itself.

Today, with the further de-industrialisation of economies such as Britain's, and the entrenchment of much industrial production in Asia, Latin America, and increasingly in Africa, as these economies themselves seek to outsource to even lower wage areas, there is no way that Enterprise Zones could provide a rational solution for British Capital. The most effective Enterprise Zones in Britain, have in fact, been those established on University Campuses i.e. the Science Parks.

But, these Science Parks are the very opposite of the EZ's. The science parks are based on high value production, and the employment of very highly skilled, workers. They are able to prosper precisely because they are able to utilise a relative comparative advantage within the global market. Creating a labour force in Britain that is characterised by such skills would take perhaps 50 years. At the very least it would require 15 years in order to raise the next generation of workers up to these kinds of levels, providing the kinds of resources that would facilitate a transition period, during which other workers could be supported and retrained. Yet, the cuts in HE, and the introduction of higher Tuition Fees, are the very opposite of the kind of policies required to bring that about!

It is possible in the meantime that some industries could be developed that could also utilise such an international comparative advantage. In areas such as Stoke there has been a history of creativity, and you do not necessarily have to be academically gifted to be creative.

In fact, some of those areas usually descried by the popular press such as Media Studies, if understood in the wider con text of such things as Video Game production, are precisely those high value added areas, which could prosper in the new global marketplace. There are no doubt, many kids in school today, who are disenchanted with traditional subjects, but whose enthusiasm for computer gaming could be harnessed in such an industry. Moreover, as I have previously pointed out Porn Free, these kinds of business can overcome the kinds of problems that normally beset small firms. That is there is no big advantage from economies of scale.

Moreover, they are the most suitable kinds of firms to establish as Co-operatives. In its recent adverts The Co-op is advertising its role in bringing about a new Revolution. It is proposing providing funding for such businesses. In fact, the Co-op, at a time when private capitalist firms have been struggling, the Co-op, like the worker owned John Lewis has had stellar results. The Co-op's profits have risen 50%.

It is unlikely that the LP and Trades Unions today will put up any kind of resistance to Enterprise Zones. They did not in the 1980's, and as already stated, the Labour Party is already competing to have them established in their areas so that they can exploit workers under even more oppressive conditions. It is necessary to think of a more intelligent means of responding to the Liberal-Tory policy. I would suggest that if EZ's are established, then Labour Local Authorities should be pressed by the local Labour Party and Trades Unions to ensure that where possible the firms established on them are Co-operatives. The Labour Party and Trades Unions should also get stuck into the Co-op, and ensure that some of those large profits, not to mention the £75 billion of assets sitting on the Co-op Bank's Balance Sheet, be used to invest in and develop these new Co-operative enterprises.

In that way, if businesses are to get advantages by setting up on EZ's, they will at least be workers enterprises. If cost savings are to be provided, in lower rates etc. then those saving should go to assist the workers in those enterprises, rather than subsidising the profits of small-scale, cowboy capitalists. In that way the policy can be turned to the advantage of workers, the new worker owned and controlled co-operative enterprises established can act to strengthen the economic position of workers, and can act to provide a model of pay and conditions to be copied by workers elsewhere, rather than the opposite that the Tories intend.

Back To Part 3

Enterprise Zones - Part 3

But, even for the highly ideological Thatcher Government, which came in emphasising its commitment to reducing the size of the State – but which ended up increasing its size – Enterprise Zones were a deeply contradictory policy.

Shutt quotes the view expressed by the official monitoring agency in relation to the fundamental role that had to be be played by spending by the Capitalist State.

“..some of the most successful enterprise zones to date are those which were already the subject of major public sector programmes at the time of designation e.g. Corby, Swansea, Clydebank” (Roger Tym, 1983, p118)

In Swansea it was the Lower Swansea Valley reclamation programme developed by Swansea City Council, the Welsh Development Agency and the Land Authority for Wales. In Corby it was work being done by the New Town Commission, and subsidies from Development Area Status, EEC low interest loans, and money from BSC following the closure of the steel works. In Clydebank it was the Scottish Development Agency which had been acquiring sites such as the BL Albion Works. In fact, the SDA was responsible for 70% of the £10.4 million of site development in the first year of EZ status.

Shutt states,

“Enterprsie Zones are, then, contributing to an expansion of state expenditure which aims to reduce land investment costs for private capital.”

Even then with this direct subsidy to private Capital by State Capitalism, finance Capital was not convinced. Shut writes,

“UK finance capital, ever cautious, prefers to play a waiting game, as yet unconvinced, that these areas can be recapitalised. It will happily allow construction and commercial capital to battle it out with the local authorities until sound investment opportunities have been created.”

But, this was not the only subsidy to private capital given by State Capitalism. In 1981/2 the Treasury paid back £5.2 million to local authorities for tax relief and capital allowances on Corporation Tax of 100% on capital expenditure for the construction, extension and improvement of industrial and commercial buildings amounted to £17.5 million. And as Shutt points out, the more successful the zones, the more expensive they become for the Treasury! He quotes the FT for October 18th 1983, which stated that for the ten year period rate relief alone at 1981 prices would amount to £60 million.

But, Shutt was right then, and the same thing applies now, when he said,

“Contrary, then to the rhetoric, enterprise zones are heavily underwritten by the state and the evidence suggests that they are not performing functions which differ significantly from traditional regional policies. They are based on the assumption that 'bribing capital' to shift location and subsidising development costs for construction and finance capital can actually halt the processes of industrial restructuring which is creating chaos in our conurbations and contribute to new job creation. Tinkering with the economic geography of the UK in this way will not solve the long-term crisis facing UK capital. It cannot create the conditions for a new innovative wave, nor can redistribution of local employment into the zones provide a solution to unemployment in the areas surrounding the zones.”

It is, if anything, typical of the general incompetence shown by this Liberal-Tory Government so far, it will be introducing these new EZ's at a time when that structure previously so important for the establishment of them, has itself been scrapped! It is inevitable that despite the stated aim of the Government to scrap QUANGOS, the absence of the RDA's, together with the squeeze on Local Authority financing, will mean that the channelling of State funds needed to establish the zones will have to come through yet another swathe of QUANGO creation.

But, as I said at the beginning, Enterprise Zones then and now were not really intended as a substantial means of creating a vibrant economy, or of solving the problems of deprived Inner City Areas, and high unemployment.

Then and now they performed rather an ideological function for the Tories. The real nature of the Tories has to be understood, to grasp this properly. I have set out previously Engels analysis of the nature of British Capital at the end of the 19th Century.

On the one hand, there was still a large number of small firms, but already by that time British Capitalism was really dominated by a relatively small number of very large firms, if not the kind of monopoly capitalism that existed in Germany and the US. As Engels pointed out this Big Capital had outgrown many of the traits of the small capitalist enterprises that dominated the earlier part of the century. Its use of large amounts of Capital equipment to back up an increasingly educated workforce, meant that Surplus Value was no longer extracted by the means of penny-pinching, and cheating of the small-capitalist, but the far more effective means of the extraction of Relative Surplus Value. The concomitant of that was large-scale production, long production runs, relatively stable market conditions, and relatively stable labour relations. The introduction of Universal Male Suffrage towards the end of the 19th Century was a part of this socialisation process of Labour, along with the new relation that the bosses forged with the Trade Union bureaucracy around the acceptance of, and incorporation of Collective Bargaining. In other words, the big bosses themselves adopted as Engels suggests the kind of ideas of “Social Democracy” that ran through the Labour Movement itself. Its manifestation in the US was "Fordism". It had the advantage for them, that the kinds of regulations that this imposed on all employers could be accommodated by the bigger Capitalists, but placed considerable burdens on their smaller brethren. As Engels points out, in doing so, it facilitated the process of consolidation, and centralisation of Capital that was taking place already.

In the US, that was manifest, because the two bosses parties, in fact, reflect this split. In Britain it was essentially reflected in the two bosses parties – the Liberals and the Tories. When the Liberals, who originally represented the free market industrialists as well as the working-class, were replaced by the Labour Party, it was only natural that the Capitalists of all stripes should see the remaining bosses Party, as their Party, rather than the Labour Party. And, for much of the twentieth century, the Tory Party did indeed continue to fulfil that function as a bosses party, but one that operated still on the basis of what were essentially social-democratic principles.

It was Neville Chamberlain that drew up the basic ideas of the Welfare State, and after WWII, Tory Governments made no real attempt to roll back the nationalisations of the Attlee Government, and certainly not the principles of the Welfare State, by which the Capitalist State fulfilled its function of ensuring the reproduction of labour power. The term “Buttskillism” was adopted to reflect this fact, being the conflation of the names of Tory, R.A. Butler and Labour leader, Hugh Gaitskill. It was only with the onset of the Long Wave Slump in the 1970's that this began to change. Even then, inside the Tory Party of Margaret Thatcher there was considerable opposition to her policies, from what were termed the “Wets”, i.e. essentially those Tories who continued to believe in that old Social-Democratic consensus. Nor was support for Thatcher's open class war policies unanimous from within the ranks of Capital either. But, the Capitalist class does represent a class as against Labour, and the Tory Party continues to be its political representative. Yet, as Engels noted, that class is far from homogeneous, its interests far from being undivided. The Tory Party represents like all parties a coalition of views and interests. The majority of its members are comprised of those very small capitalists, whose penny pinching methods Engels set out as having been discarded by the Bigger Capitalists, as well as by the middle class, and aspiring middle class elements from within the backward sections of the workers and petit-bourgeoisie. This coalition of views within the Party is only a microcosm of the electoral coalition it needs to mobilise in order to ensure that it can gain a Parliamentary Majority. In fact, Peter Hitchens was probably correct when he said recently, that the Tories are probably incapable now of mobilising such a coalition of votes on their own, which is why they need the Liberals. But, they can only mobilise such votes if they appeal to those small minded views, and the interests of those elements, and without the ability to win Parliamentary majorities they are no use to Capital as a whole.

In the 1980's Thatcherism worked because it was able to mobilise that electoral coalition, whilst being given freedom of movement by Big Capital, which was facing its own problems resulting from the Long Wave slump, and the problems of resolving those problems via the extraction of further Relative Surplus Value.

The nature of the crisis following the Financial Meltdown is providing Cameron with similar conditions today, yet the reality is that globally the world economy is in a Long Wave Boom. In reality, the ideological basis of Cameron's policies are contradictory to the interests of Big Capital today. That can be seen by the demise already of some large companies such as Connaught that are a direct result of those policies. Many other firms dependent upon the Public Sector for contracts within construction and through to ICT, are also being hit badly. But, even in the High Street, large firms are also suffering from the Liberal-Tory policies and are saying so. The latest example is Dixons, who as the FT here reports made clear that its dramatic fall in sales of 11% in 11 weeks, was a direct result of Government policy.

"It cited the “chilling” effect of public sector workers waiting to hear whether they would lose their jobs."


"John Browett, chief executive, said: “The issue ... at the moment is more to do with mid-market families who maybe have somebody who works for the government, or both people who work in government.”


"“Areas with heavy reliance on government employment are the most difficult markets.”


Source: FT.Com

But these policies are being driven firstly because of the nature of the Tory Party itself, and because of its need to appeal to its electoral base. Enterprise Zones are merely a reflection of that. As stated earlier they have absolutely nothing to offer Big Capital. But, they do fulfil another function, just as they did in the 1980's. That is as an ideological battering ram.

Back To Part 2

Forward To Part 4