The Burston Strike School longest strike in British history

Last weekend saw the anniversary of the The Burston School Strike which till this day was still the longest strike in British history. The Burston Strike School was at the centre of the longest running strike in British history, between 1914 and 1939. Now a museum, it is in the village of Burston in Norfolk, England. The strike began when teachers at the village's Church of England school, Annie Higdon and her husband, Tom Higdon, were sacked after a dispute with the area's school management committee and schoolchildren went on strike in their support. The Higdons set up an alternative school which was attended by 66 of their 72 former pupils. Beginning in a marquee on the village green, the school moved to local carpenter's premises and later to a purpose-built school financed by donations from the labour movement. Burston Strike School carried on teaching local children until shortly after Tom's death in 1939. This famous strike is comemerated every year to show the endeavor and determination of the labour movement to succeed when the chips are down. The initiative shown by these workers to set up an alternative school to continue to teach the local children is a testament to working people’s ability to organize society. What this strike and what happened out of it tells me that working people are more than capable of running society despite what we are told and if up against it workers have the ability to organize among each other to the benefit of society. The rubbish we are told that workers need boss’s to run society is nonsense this strike here alone shows that workers are intelligent enough to know how to run society and would in my opinion run it far better for the many not just the few than the current system we live under. The background to the dispute was about honest working class people in the teaching profession wanting to make the system better and coming up against the establishment every time. Using old laws and their influence in the community the parish made things very hard for the Higdons Tom Higdon was born on 21 August 1869 at East Pennard, Somerset, and the son of a farm labourer. Annie Katherine Schollick (Kitty) was born on 13 December 1864 in Poolton-cum-Seacombe in Cheshire. They married on 4 July 1896, living first in London before moving to Wood Dalling in Norfolk in 1902. This coincided with publication of an Education Bill in Parliament which offered education to working class children, though in practice it was intended to ensure that they learned their place in society and respected their social betters. In Norfolk, as in most parts of the country, this meant that the boys were to be made farm labourers and the girls domestic servants. Kitty was appointed headmistress at Dalling County School with Tom an assistant teacher. Identifying themselves with the local farm labourers, the Higdons ran up against almost immediate resentment from the school managers, who were mostly farmers. They objected to the cold, insanitary conditions of the school and especially protested at the farmers taking children away to work on the land whenever they were needed. Eventually, after a complete breakdown of relationships, the Norfolk Education Committee gave the Higdons a choice: accept dismissal or transfer to another school. They took up the latter offer and moved to the Burston School in 1911. Arriving at Burston, the Higdons found conditions were no different. The newly arrived rector, the Reverend Charles Tucker Eland, was appointed chairman of the School Managing Body. Eland intended to recover the powers the Church had lost to the parish councils. He demanded deference and recognition of his right to lead the community. His situation, with an annual salary of £581 and a large comfortable rectory contrasted starkly with the farm labourers and their families, living on average wages of £35 a year in squalid cottages. Their employers, themselves mostly tenants of brewery-owned land, naturally allied with the rector. In 1913, Tom Higdon successfully stood for election to the parish council, topping the poll with Eland not just being unelected, but coming bottom. However, although the rector and the farm owners had been defeated in the parish council election, they still had control of the school's Managing Body and were determined to use this power to victimise the Higdons. Since their arrival in Burston, the Higdons had complained about conditions in the school, particularly the dampness, inadequate heating and lighting, lack of ventilation and general unhygienic conditions. Looking for a pretext for action, the managers accused Kitty of lighting a fire without their permission - to dry the clothes of children who had walked three miles to school in the rain. She was also accused of gross discourtesy when reprimanded for this act. In addition, Kitty was accused of beating two Barnardo girls. Despite her pacifist principles, the manager found there was "good ground for the complaints of the Barnardo foster mother" and they demanded the Higdons be transferred. Tom and Kitty also demanded an inquiry which was made by the Education Committee. The inquiry made no mention of the charge of "fire-lighting contrary to instructions" nor Kitty's repeated complaints about conditions at the school. The beating accusation was declared to be not proven. The final accusation of discourtesy to managers was accepted and the Higdons were given three months' notice. The Higdons' dismissal took effect on 1 April 1914. As the authorities were taking over, the sound of children marching and singing could be heard. 66 of the school's 72 children had gone on strike, marching around the village waving flags. None of them returned to the school, but instead had lessons on the village green. The school was well equipped, maintained a full timetable and observed registrations with the full support of parents. The authorities were in no mood to tolerate this defiance and 18 parents were summonsed to court and fined for failing to ensure their children's attendance at school. Collections outside the court paid the fines, and since the parents were sending their children to the school of their choice, the authorities were soon forced to back down. Word of the strike quickly spread and it became a central issue for trade unionists and school reformers throughout the country. There were regular visitors of supporters and speakers. With the onset of winter, the school moved in empty workshops. The authorities kept up their intimidation with farmers sacking farm labourers (which also meant eviction from their tied cottages). This could not be maintained, because a shortage of labour during World War I meant that they had to be re-employed. Striking families who rented land from the Rector for growing food were evicted and their crops and property destroyed. The village's Methodist preacher, who held services on the village green on Sundays for families of the Strike School children, was censured by his church. At the end of the first year of the strike, with the lease on the old workshops due to expire, an appeal was made for funds to build a new school. By 1917, a National Appeal had reached £1250 with donations from miners' and railway workers' unions, Trades Councils, Independent Labour Party branches and Co-operative Societies. The new school was opened on 13 May 1917, with the leader of the 1914 demonstration, Violet Potter declaring, "With joy and thankfulness I declare this school open to be forever a School of Freedom". The Burston Strike School continued until 1939. Tom Higdon died on 17 August 1939. Kitty, in her seventies, was unable to carry on alone, and the last eleven pupils transferred to the Council School. Kitty died on 24 April 1946. Both are buried in Burston churchyard. Every year we celebrate this strike and the efforts of the labour movement to step in and support workers in struggle. We will need more efforts like this to stand up to the boss’s in the coming period I feel. With more strikes likely a new layer of leaders is needed ones who won’t sell out or run from a fight instead get in and fight for their members and their communities. With extracts taken from wickepedia entry on the strike.

How Lenin looked to deal with bureaucracy

"In the last period of his life Lenin was desperately concerned about the growth of bureaucracy in the Soviet state and in the Party." Lenin feared for the party and the Russian state and could sense Stalin’s rise and him concentrating more and more power in his hands. Many people understand wrong the definition of bureaucracy today many believe bureaucracy" as if it were simply a matter of "bureaucratic behavior", excessive red-tape, officialdom, etc. Such an approach has nothing in common with the Marxist method, which explains bureaucracy as a social phenomenon, which arises for definite reasons. Lenin, approaching the question as a Marxist, explained the rise of bureaucracy as a parasitic, capitalist growth on the organism of the workers' state, which arose out of the isolation of the revolution in a backward, illiterate peasant country. Lenin’s ideas did not grow into Stalinism as many opponents of socialism tell us. Stalinism was a rise of the bureaucracy which h fed off of the degeneration of the Russian workers state. In one of his last articles, Better Fewer but Better, Lenin wrote: "Our state apparatus is so deplorable, not to say wretched, that we must first think very carefully how to combat its defects, bearing in mind that these defects are rooted in the past, which, although it has been overthrown, has not yet been overcome, not yet reached the stage of a culture that has receded into the past." (Works, vol. 33, page 487) The October revolution had overthrown the old order, ruthlessly suppressed and purged the Tsarist state; but in conditions of chronic economic and cultural backwardness, the elements of the old order were everywhere creeping back into positions of privilege and power in the measure that the revolutionary wave ebbed back with the defeats of the international revolution. Engels explained that in every society where art, science and government are the exclusive of a privileged minority, then that minority will always use and abuse its positions in its own interests. And this state of affairs is inevitable, so long as the vast majority of the people are forced to toil for long hours in industry and agriculture for the bare necessities of life. After the revolution, with the ruined condition of industry, the working day was not reduced, but lengthened. Workers toiled ten, twelve hours and more a day on subsistence rations; many worked weekends without pay voluntarily. But, as Trotsky explained, the masses can only sacrifice their "today" for their "tomorrow" up to a very definite limit. Inevitably, the strain of war, of revolution, of four years of bloody Civil War, of a famine in which five million perished, all served to undermine the working class in terms of both numbers and morale. The NEP stabilized the economy, but created new dangers by encouraging the growth of small capitalism, especially in the countryside where the rich "kulaks" gained ground at the expense of the poor peasants. Industry revived, but, being tied to the demand of the peasantry, especially the rich peasants, the revival was confined almost entirely to light industry (consumer goods). Heavy industry, the key to socialist construction, stagnated. By 1922 there were two million unemployed m the towns. Immediately after the seizure of power, the only political party which was suppressed by the Bolsheviks was the fascist Black Hundreds. Even the bourgeois Cadet Party was not immediately illegalized. The government itself was a coalition of Bolsheviks and Left Social-Revolutionaries. But, under the pressure of the Civil War, a sharp polarization of class forces took place in which the Mensheviks, SRs and "Left SRs" came out on the side of the counter-revolution. Contrary to their own intention, the Bolsheviks were forced to introduce a monopoly of political power. This monopoly, which was regarded as an extraordinary and temporary state of affairs, created enormous dangers in the situation where the proletarian vanguard was coming under increasing pressure from alien classes. In relation to Stalin, Lenin writes that "Comrade Stalin having become General Secretary has concentrated enormous power in his hands, and I am not sure that he always knows how to use that power with sufficient caution." Repeatedly, Lenin characterized the bureaucracy as a parasitic, bourgeois growth on the workers' state, and an expression of the petty-bourgeois outlook - which penetrated the State and even the Party. The petty-bourgeois reaction against October was all the more difficult to combat because of the exhausted state of the proletariat, sections of which were also becoming demoralized. Nonetheless, Lenin and Trotsky saw the working class as the only basis for a struggle against bureaucracy, and the maintenance of a healthy workers' democracy as the only check on it. Thus, in one article Purging the Party Lenin wrote: "Naturally, we shall not submit to everything the masses say because the masses, too, sometimes - particularly in time of exceptional weariness and exhaustion resulting from excessive hardship and suffering - yield to sentiments that are in no way advanced. But in appraising persons, in the negative attitude to those who have "attached" themselves to us for selfish motives, to those who have become "puffed-up commissars" and "bureaucrats", the suggestions of the non-Party proletarian masses and, in many cases, of the non-Party peasant masses, are extremely valuable." (Works, vol. 33, page 39) As the bureaucracy became more remote from the working class within Russia, so it increasingly gave up confidence in the proletariat abroad. The Communist International was transformed into an agency of the bureaucracy's foreign policy. Searching for national security, the bureaucracy began to play a counter-revolutionary role on the world arena. The perspective for an independent struggle for socialism was abandoned. In an effort to provide theoretical, 'Leninist' justification, Stalin exhumed Lenin's old formula of the democratic dictatorship of the proletariat and the peasantry. In other words, they returned to the policy they had supported at the beginning of 1917 - before they had been defeated by Lenin in the struggle within the party. The revival of this discredited policy was applied with disastrous results to the Chinese revolution of 1925-26. Against the wished of the leadership of the Chinese Communists, the Stalinist bureaucracy imposed a policy of subordination to the Chinese bourgeoisie led by Chiang Kai-cheek and the Kuomintang. This led to the defeat of China's dynamic working class, with the massacre of thousands of Communists and militants. Since then, the same policy has been applied with the same disastrous results. In the post-Second World War period the ex-colonial lands have experienced a series of revolutionary upheavals. The communist party leaders, still dominated by Stalinist ideology, have invariably subordinated the workers' organizations to the interests of national-capitalist leaders. In many cases this has meant support for Bonapartist, including military bonapartist leaders. Sukharno in Indonesia, Kassim in Iraq, Gonclaves in Portugal - the list could be extended around the world many times. Lenin stood for all workers officials to only receive the wage of a skilled worker, an immediate right to recall, a rotation of tasks to not get too bogged down in one position for too long and for all officials to be accountable to their members. These policies we still stand by today in the socialist party and look to popularise them in our fight against bureaucracy and for the most open democracy at all times with thin the labour movement. With extracts taken from Lynn walsh’s introduction to Lenin’s April thesis and Ted Grant and Alan woods lenin’s fight against bureaucracy

Class or the party first? Why both are equally important

I am as many of you may or may not know I’m a Socialist party member, a member of the CWI and a Marxist a bit of a mouthful but do I put our party before the working class? Never to me they go hand in hand and always should do if we are too far ahead or are chasing after the class are we doing something wrong. For Marxists to gauge the mood of the working class putting forward demands and transitional demands that can win workers to a Marxist programme which will eventually lead workers to drawing the conclusion that this current system of capitalism cannot meet everyone’s needs and needs to go. I believe the vanguard of the working class the most advanced layer of the working class who have drawn the conclusions as we have that the current system needs to go and cannot be reformed especially now given the global economic crisis . We fight for a socialist democratic system based on the needs of the many not just the few. For me that means joining a party and the Socialist party meets my expectations of a revolutionary party looking to change society. I don’t just think that changing a capitalist neo liberal government for another will do. While I don’t slavishly follow everything the SP say like some think I do I do however think we have the best all round Marxist programme and the most democratic organisation going. Of course I haven’t experienced all but I’m happy in the party I am and am happy to promote our ideas as a movement to win over others and to move the working class in the right direction. But I do think about every step trying to apply a Marxist theory to every situation every political question that may arise. I do not follow the SP like a cult or a fan club I see it as a means to an end not an end in itself. Of course I support the party whole heartedly and feel we have the best well thought out genuine Marxist ideas but debate and critical thinking is always welcome and actively encouraged certainly in our branch and I am convinced throughout the party too. We may not always agree that is the nature of democracy but we do as a party agree the working class has the power to change society. This is where we reach out to the wider working class to win over and spread our ideas. Not to doctrinate them as some put it but to begin to win workers to the ideas of genuine socialism which as I’ve felt for a long long time now that is many workers default position. I believe all workers are deep down natural communists who believe in thebenifit of the many over the few and that what we produce should be shared out. But as we know current society capitalist society convinces us this is not the case and push’s us in a entirely unnatural direction of greed, procession, exploitation of others and division for the benefit of a few. We, I and I would go as far as to say the majority of the working class reject this and fight against this every day. It is a constant struggle as we say. It is key we never put the working class or the party before each other ideally the party should inspire the working class but we know the both need each other to survive. The party should never come before the class as that would be sectarian but instead it should learn from the class and look to lead while keeping step with the workers movement. Giving clear guidance of the way forward learning the lessons from history and applying those lessons to today. As the old saying goes you move with your class not before or after it. Being in tune with the working class is a art in itself but a good rounded out Marxist theory can go a long way to helping this.

France: difficulties bubbling under surface for Holland

France’s president Francois Holland who swept to power on the back of a growing turn against austerity is already starting to let his voters down. The CWI has always said if you do not break with capitalism you will be forced to meet its calls which call for austerity. France’s economy is not performing well and trouble may be ahead for Holland and the French economy very soon indeed. Hollande, who returned from a 15-day summer break last week, faces an economy that hasn’t grown in three quarters, rising joblessness, a ballooning trade deficit and the task of coming up with a plan in the next few weeks to plug a budget hole of more than 30 billion euros ($37 billion) for next year. The challenges ahead may undermine the rally in French bonds that has allowed the country to sell bills at negative yields for the first time. During Hollande’s first 100 days in office, the premium demanded to hold French 10-year debt rather than comparable German securities fell to the lowest in more than a year. That trend may be reversing. “France’s fundamentals -- rising unemployment, widening current account deficit and budget deficit -- would not support its bonds,” said Jamie Stuttard, head of international bond investments at Fidelity Investments in London, Sovereign debt from France, which was stripped of its AAA rating by Standard & Poor’s in January, got more expensive throughout 2012 -- notably since Hollande’s victory. The rally came as the European Central Bank cut its main interest rate to a record low and reduced its deposit rate to zero as the euro area teetered on the verge of recession and Spanish and Italian 10-year bond yields climbed above 6 percent. Whether or not European leaders manage to reassure investors, Hollande also knows he has an uphill task ahead at home. According to the national auditor, he will have to find about 33 billion euros in new tax revenue or savings by the time his government sets out its 2013 budget on Sept. 24. The budget hole will be larger if the finance ministry is forced to lower its 2013 growth forecast of 1.2 percent. That’s looking likely after France posted a third consecutive quarter without expansion in the three months through June. French jobless claims rose to the highest in 13 years in July as stalling growth prompted companies to trim payrolls, a Labor Ministry report yesterday showed. Prime Minister Jean-Marc Ayrault declined to repeat next year’s growth forecast in a radio interview on Aug. 22. For the first time since Hollande took office on May 15, a majority of French voters lack confidence in his ability to run France, pollster CSA said Aug. 23. Only 49 percent of the French said Hollande has the capabilities to steer the country, down from 58 percent in May, according to the CSA poll for Les Echoes newspaper carried out Aug. 21 and 22. His predecessor Nicolas Sarkozy had a rating of 55 percent at the three-month mark in 2007. Clearly a lot of the optimism Holland swept to power with from many sections of the left and the liberal left is starting to wain. Holland will be forced to make huge cuts to jobs and services which will bring him into conflict with the mighty French working class who have been somewhat quiet of late compared to their usual militancy they are so well known for. What is clear though is that France will not be immune to outside risks and the chickens of Hollands failure to break with the market and capitalism may come back to haunt him. What is needed though is a mass party of the French working class. The left front in France if it keeps up its upward curve of support and highlight Hollands misgivings I am sure we will start to see the left gain ground in France and hopefully move into action. Let’s hope the French working class remember their famous revolutionary traditions and show Europe how to struggle later this year. I look forward to sharing solidarity with the French workers who certainly know how to strike leading to a near revolution in 1968. Workers must learn the lessons from 1968 and lay the ground for bigger and more explosive struggles on the horizon. With extracts taken from Bloomberg

The Dutch election, will voters turn to the left?

With the upcoming elections in Holland Dutch people are facing a choice of a fairly new party. The socialist party in Holland – no relation to the Socialist party I’m a member of I might add. This former Maoist party no fully reformist could gain big in the coming polls. The polls point to a neck-and-neck race between the SP and the liberal VVD for top spot. The political spectrum remains fractured, with no obvious majority emerging. But if the SP does become the biggest party Mr Roemer should have first shot at forming a cabinet, for the first time in his party’s 40-year history. Tracing its roots to the split between Soviet and Chinese communism, the SP was once proudly Maoist. But it shed its Marxist-Leninist ideology at the time of the fall of the Berlin Wall, replacing it with messages of solidarity and human dignity. It has since slowly gained ground, going from two MPs in 1994 to nine in 2002 and then 25 in 2006. It slid back to 15 in 2010, but under Mr Roemer’s leadership its popularity has bounced back. Some of this is down to Mr Roemer’s warm and friendly image and unforced man-of-the-people sense of humour that puts him in contrast with other Dutch politicians. But it also reflects a political agenda that responds to the fears of the voters. Without explaining how he would find the money, Mr Roemer promises both to safeguard the welfare state and to share the burden of paying for it more equally. Which I’m sure all sounds very good to Dutch voters who may be willing to give this party a chance at governing. But as Dutch capitalism continues to perform reasonably well in the Euro this can surely only last so long. The SP is not against the European Union, but would slash its budget in half. Nor is it against the euro, only against excessively strict budget-deficit rules (and, by implication, against cuts at home to finance bail-outs abroad). So how the SP would do if fully elected would be interesting as with many refromist parties they could be pushed in eitehr direction furtehr than they originally intended depending on the mass pressure from below. They may end up buckling and pushing through more cuts but we wait and see the outcome of this election. Not given much coverage so far could be quite an interesting one to watch. It is still clear though that Holland too needs a new workers party to provide working class Dutch people with a political voice if the SP does not succeeed in fighting for workers workers should start the process of forminga new mass workers party out of the trade unions. All in all the coming period will be a difficult one for Holland and the Dutch working class as the Euro crisis deepens further into 2013.

Why I’ve taken to reading the capitalist press

Yep you’ve read that correct I have started looking at the bourgeois press the more quality stuff that is. You may be surprised to hear that but there is a method in my madness. I haven’t suddenly chucked my Marxist principles out the window but in fact I’m taking a greater interest in the global economy for several reasons. As a Marxist reading our own material can be great propaganda and agitation material to win over workers but to find out what is really going on out there in capitalism reading such publications as the Economist and the Financial times and the Wall Street Journal to name just a few. These are in the main well put together papers and magazines. They are often pro market of course and do not tell it how it is from the workers perspective. But that is where I need to apply Marxist analysis to understand what is really going on underneath the surface of society and in the economy at large. There is an old phrase that revolutions start at the top and in many ways this is true the tops of the trees begin to shake at first and this sends shock waves to the very foundations of society. Understanding what is happening at the very top of capitalism and the process’s involved just as Karl Marx did in his excellent analysis of capitalist production in the 1800’s can give us a excellent insight into predicting what will happen next in terms of the class struggle. Understanding if we’re in a period of growth or decline and how the economy is going to develop or contract in the next period. Understanding b bourgeois ideaology can be interesting but can also provide us a glimpse of their thinking. The old phrase keep your friends close but your enemies closer applies here. Understanding the twists and turns of the class struggle is key to applying the correct slogans and understanding of what period we are in and how we can best put forward a programme to change society towards a socialist transformation of society. While I don’t read the capitalist press religiously it does pay all workers if they can to take an interest in the wider economy out there to see where we are going and to independently educate ourselves. Watching our own news and our own material will only tell you so much it’s good to get a rounded out perspective on the world and the way society is heading. Its key for all revolutionaries who have a aim in changing society to understand capitalism and how it works this does not mean agreeing with it but to over throw capitalism we must understand it where its weakness’s lie and when it is most venerable. These tend to be the points just before an incline or just after a crash Trotsky’s curve of capitalist development is an excellent piece to get to grip with this idea of when workers can go on the offensive and will be most confident of wins. But we are now in a huge downturn in capitalism and there will be opportunities for workers to come to power many opportunities. We must learn the lessons to be prepared to take those chances when they arise. Those who don’t learn from history are doomed to repeat the mistakes of history as they say.

Could Keynesian policies solve the global economic crisis?

Much debate is raging in America and among leading economists as to whether Keynesian policies could be an escape route for global capitalism. While we cannot rule anything out in the class struggle when the ruling class get desperate as no doubt they will do as their system grinds itself into a deeper recession and depressions in many places calls for state intervention will become louder and louder from certain economists. One of the most outspoken economists who promote such policies is Paul KRUGMAN who is a Liberal at the end of the day but does speak out and opposes austerity. He doesn’t line up with the working class though lets be clear. Hefundemenatlly supports the capitalist system still but wish’s to see different tactics used. Extracts below are taken from Comrade Lynn Walsh (who is editor of Socialism today) excellent review of Paul Krugman’s recent book full article can be read: http://www.socialistworld.net/doc/5904 Political leaders, according to Paul Krugman, have failed to learn the lessons of the 1930s. Through a combination of distorted ideology and economic self-interest they exerted pressure for a return to deficit reduction policies in 2010, undermining the fiscal stimulus policy. Obama lacked the “Rooseveltian resolve” demonstrated by President Franklin D Roosevelt during the great depression. Krugman recognises that Obama faced bitter opposition from the Republican-dominated Congress, but criticises his failure to make the case for a bigger stimulus package. Obama failed to effectively mobilise public opinion behind such an intervention. The result is the current, lamentable state of the US economy. So Krugman has written a tract for the times. Its title suggests that it is a campaigning pamphlet rather than an academic analysis. It is succinct, polemical, and satirical in places, advocating unashamedly Keynesian policies which, in his view, could rapidly end the recession and produce sustained growth. Krugman is a prominent academic economist in the US, but best known for his informative and polemical columns in the New York Times. He is the most prominent of the Keynesian economists (including people like Joseph Stiglitz) who advocate more state intervention to stimulate recovery, and are severely critical of the voodoo economics of the ultra-free-marketeers, now championed by the Republican presidential candidate Mitt Romney, and especially by his vice-presidential candidate, Paul Ryan. Without state intervention in the US and elsewhere to rescue the banks there would have been a worldwide collapse of the financial system. There has been a trend of a turn by the capitalists away from investment in manufacturing and towards ever greater investment in the financial sector. Short-term profits through financial speculation, which tended to concentrate profits increasingly in the hands of the top 1% - or, more accurately, the top 0.01% - became a dominant economic trend. Ultra-free-market ideology was promoted to legitimise the shift. Financialisation changed the structure of the US economy and other advanced capitalist countries. They concentrated more and more on services, boosted consumer demand through the expansion of cheap credit and the boom in housing and financial assets, and outsourced manufacturing to low-cost economies such as China. The Keynesian approach is a very simple looks at things a very one-sided view that things could be different if we just changed our macro economic policy. Of course the crisis is far more far reaching and fundamental than that. The Keynesian argument is that in this situation the state has to step in and stimulate demand. Lowering interest rates (even to zero) is not enough. By borrowing money to finance deficit spending – or by printing money – the state should inject demand into the economy. Increases in the social safety net (for instance, unemployment benefit) and job creation schemes (such as, infrastructure projects) could reduce unemployment and support increased demand. However, in isolating the factor of ‘demand’ as the crucial factor, Krugman fails to get to the root of the problem. The Keynesian idea is that a spurt of state spending will jump-start the economy, creating jobs, stimulating investment, and so on, “until the private sector is ready to carry the economy forward again”. But it is far from certain (leaving aside capitalist hostility to an increase in the economic role of the state) that a short-term stimulus of this type would actually revive investment and production by the big corporations. Capital investment has been declining as a share of GDP in the US and other advanced capitalist countries since the early 1980s, despite the increased share of profits in national income. The stagnation of capital investment continued in the US in the 1990s and the 2000s despite the high level of demand (which was sustained by credit/debt). Keynes believed that ‘equilibrium’ of the market would break down at a certain point because of the capitalists’ so-called ‘liquidity preference’. In other words, they would save more than they invested, preferring to hoard their cash rather than invest it productively. Keynes explained this through the factor of ‘confidence’, a subjective explanation. In reality, the lack of confidence is rooted in an estimation of a much more objective factor: the prospects of making adequate profits. ARE KEYNESIAN POLICIES now ruled out? Some people undoubtedly think so. “In the current market environment”, says a Deutsche Bank analyst, “there is no room for using a Keynesian-type expansionary fiscal policy to boost demand in countries with low growth – the markets will simply not accept such a strategy”. (International Herald Tribune, 10 January). Global financial markets are now far bigger than they were in Keynes’s time, or even before the 1980 neo-liberal ‘revolution’. In 1980 financial assets (in reality, credit/debt securities) were equal to one year’s output of the global economy. By 2006 such assets amounted to four times global output. This scale gives speculators – the so-called ‘bond-market vigilantes’ – the power to speculate against any governments that carry out policies of which they disapprove. The bond traders, moreover, are reinforced by ultra-free-market ideology, which now dominates the thinking of capitalist governments and international agencies such as the OECD. Despite the deepening of the current world recession, they really believe that unfettered markets will produce growth – and mass unemployment and impoverishment of sections of the working class will not dent this growth. The kind of policies advocated by Krugman, if effectively implemented, could cushion the downswing in the US and elsewhere. But they would not overcome the underlying problems of capitalist accumulation. In any case, many Keynesians feel that it is already too late. For instance, Keynes’s biographer, Robert Skidelsky, writes: “At last, opinion is starting to shift [in favour of Keynesian policies] – but too slowly and too late to save the world from years of stagnation”. (The New Republic, 12 July) Yet things can change. The capitalist crisis will produce social explosions and eruptions of class conflict. In the US, for instance, in the event of Romney winning the presidency and implementing the policies advocated by Ryan, they are likely to provoke an even worse slump. (It is possible that even a Romney-Ryan presidency would be forced more by pressure from big business to temper its crazy ideas with more pragmatic policies.) Explosive movements of the working class and deep social crisis will, under certain conditions, push capitalist governments into adopting Keynesian-type measures to avoid a mortal threat to their system. Keynes himself said that his policies were designed to avoid revolution. When it is a question of saving their system, the capitalist class will, at least temporarily, make concessions to the working class. To reduce mass unemployment they may well adopt public works programmes. They will be forced to repair the social safety net. But such policies will be a temporary expedient. They will not be a return to the long-term, sustained Keynesian policies of the post-war upswing, when the state increased its intervention in the economy and developed an extensive social welfare infrastructure. Keynesian policies may buy time for the ruling class but they cannot resolve the crisis of capitalism. How, as socialists, should we regard a stimulus package or programme of public works? In the face of mass unemployment and the prospect of prolonged economic stagnation, the leaders of workers’ organisations should indeed be calling for a massive programme of public works to provide jobs and stimulate growth. To be effective, a public works programme would have to be on a much bigger scale than that proposed by Krugman. It would mean the refurbishment and addition of new infrastructure, especially homes, schools, hospitals, community facilities, etc. Workers should be employed on a living wage with full trade union rights. Effective economic stimulus would require a big increase in social spending, increasing pensions and other benefits. Tax rates for the wealthy and big corporations should be substantially increased, with a levy on the uninvested cash piles of big companies. Effective measures should be taken against tax evasion and avoidance. It has to be recognised in advance, however, that the capitalists will vehemently resist a bigger role for the state and increased taxation. A programme to provide jobs and stimulate growth would require the mobilisation of the working class. Moreover, increased taxation in itself will not be sufficient to develop the economy. The dramatic raising of the living standards of the majority of the population would require the resources (additional real wealth) created by increased production. The banks and finance houses would have to be nationalised (not bailed out and propped up at public expense), and run under democratic workers’ control and management. This would ensure the credit required to develop all sectors of the economy. There would also have to be capital controls to prevent any flight of capital. Such measures would undoubtedly meet the entrenched resistance of the capitalist class. State intervention in favour of the working class would unavoidably pose the question of the takeover of the commanding heights of the economy, to form the basis of a democratic plan of production (run by elected representatives of the workers and the wider community). Any government carrying out such a policy would need an international perspective, collaborating with the workers’ movement in other countries to develop socialist planning at an international level.