Wednesday, 26 October 2011

10,000 public sector jobs lost in Wales and counting…

Welsh youth to join the Jarrow March For Jobs

Over 10,000 public sector jobs have been lost in Wales in the last year according to accountants PwC. And it will get a whole lot worse according to the Wales Audit Office (WAO) who expects 21,000 jobs to be lost by 2015. So far the cutbacks have been less severe in Wales than the rest of the UK, but that has merely delayed the worst of the cutbacks.

The Welsh government delayed the cuts until after the Assembly elections in May this year, but fully intend to make them bite this year and the next two years. Already 1,000 jobs have been lost in the Welsh government itself. The NHS, education and councils are currently shedding jobs like leaves from the trees outside the Assembly offices in Cathays Park.

The ConDem government’s claim that job losses in the public sector will be made up by job gains in the private sector are confounded when you look at the small print of the employment figures. There has been a small growth in the number of employees (although not enough to stop a sharp rise in unemployment) but only by a rise in part time and temporary jobs. So permanent employment has been replaced by underemployment and short term employment.

And public sector cuts will lead to workers’ jobs being lost in the private sector as well. PwC estimates that over 50,000 jobs will be lost in Wales in the public and private sectors as a result of the cuts.

The loss of jobs in the public sector is also putting enormous strain on the remaining workforce. In the NHS (where a colossal £570 million is being cut in Wales) workers are reporting that they are having to cover for the unfilled vacancies as workers leaving are not replaced.

The response of people in Wales to the cuts has already been angry but they have only just begun to bite. Thus far the Welsh Labour government has been able to shift the blame onto the shoulders of the ConDem government in Westminster who control the purse strings and cut the funding for public services in Wales. The Welsh government has shrugged its shoulders and said "What can we do?" before cutting services to the bone. But that can only last so long before the cuts become intolerable.

The Wales Audit Office points out that the cuts will be absolutely unprecedented. Spending on public services has never been cut more than two consecutive years. It will now be cut in real terms for five consecutive years. Real term funding will be cut by a massive 12.4% over that period.

The NHS in Wales will really suffer with health spending due to be cut by 6.2% in three years in real terms. At the moment health spending per head is slightly higher in Wales than the UK average. However compared to other areas with similar socio-economic characteristics like the North East of England, Scotland and Northern Ireland it is the lowest. The Welsh government proposes to cut it even further so that it falls even below the UK average.

The Welsh Labour government that pretends to stand in the tradition of the NHS's socialist founder, Aneurin Bevan, is attempting to force health spending to the lowest in the UK.

Revenue from the Welsh government to the councils will fall by £283 million by 2013 (a 7% cut). So basic council services will be cut and thousands of council jobs will go. Many council workers are being hit by a double whammy in Wales. As well as the cutting back of staffing levels and the extra workload heaped on the remaining workforce a substantial number are having their pay frozen and even cut by the job evaluation process taking place in Welsh councils.

In Rhondda Cynon Taff and Neath Port Talbot councils the workers have been hit with a triple whammy as these Labour-run councils have threatened their workers with wage cuts or get the sack. Some councils are attacking union organisation withdrawing facility time or other union facilities to try and prevent the unions from defending their members.

And according to the Wales Audit Office things would have been just as bad if Labour was in power in Westminster. Last year the WAO had calculated £1.5 billion cuts to the year 2013-14 based on the estimates of the outgoing Brown government’s planned cuts. The actual figure was virtually the same at £1.6 billion. In other words Labour’s cut to Welsh funding would have been as bad as the ConDems.

But while jobs are being massacred in Wales the youth are showing that a fightback is on the way. Next week a delegation from Youth Fight For Jobs are following up their hugely successful Merthyr to Cardiff march by joining the Youth Fight For Jobs Jarrow march to London. A dozen Youth Fight For Jobs activists from Wales will join the march as it moves towards its arrival in London on November 5th.

This will bring home the burning issue of youth unemployment, running at over 30% in Wales. It will up the ante as we prepare for the one day public sector strike planned for November 30th.

by Dave Reid

Tuesday, 25 October 2011

1,000 march on Cardiff Hardest Hit demo

Tories welcomed by charities but not Remploy workers!

The turnout of 1,000 at the ‘Hardest Hit’ march and rally in Cardiff on October 22nd showed both the huge anger developing against the Tories’ proposals and potential to build a mass campaign against the attacks on the disabled. Disabled campaigners, trade unionists and the wider anti-cuts movement got a great reception in the city centre as they marched through, chanting “no ifs, no buts no disability cuts”.

But it also showed the weaknesses of cross party, cross class approach taken by many charities and politicians who claim to be the official leadership of the disability rights movement.

The march was inspiring in that a thousand disabled people, carers, trade unionists and anti-cuts campaigners turned out to march through Cardiff. The overwhelming majority of those that turned out would have been looking for a lead in the fight to defeat attacks on disability benefits and a plan of action to defend vital public services including the NHS and local authority services.

They would have been sadly disappointed listening to the official platform of speakers which consisted of directors and executives of charities and 3 Welsh Assembly Members. The AMs included, unbelievably, Mohammad Ashgar, Tory AM for South Wales East. This representative of the Tory originator of these cuts was allowed to speak, while Les Woodward, the national trade union convenor for Remploy - employing around 2,800 disabled workers and threatened with closure by the same Tory party of which Mr Ashgar is a Welsh representative – was refused on the grounds that he was “too political”. When large parts of the rally booed and heckled this representative of the party of the ruling class they were told to be quiet by the chair because the “support of all parties” is needed.

It took a comedian to introduce some sense to the platform, when actor and writer, Boyd Clack (Satellite City/High Hopes),told marchers that the lesson taught to him by his dad as a boy – “you can never trust a Tory” is as true today as it has ever been. But, he warned, that his father would be turning in his grave to see what the Labour Party he supported, has become. He warned disabled fighters to rely only on their own strength and not the support of politicians. He could have added that we should not rely on the support of charities which rely on government funding and will do all they can to argue for their own slice of a shrinking pie, while doing everything in their power to prevent political discussion.

Fortunately disabled campaigners do have allies they can rely on to fight all the way with them – public sector trade unionists, their families and the working class in general. This was the theme of the ‘alternative’ rally that Socialist Party members staged – that the struggle against the Welfare reform Bill and other attacks on the disabled can be defeated, as part of a campaign to oppose all public sector cuts.

Thanks to the Socialist Party, Les did get to address the crowd on the importance of fighting for Remploy and the thousands of disabled workers that it provides with the dignity of training, learning skills and earning a wage. He also exposed the shameful way that charities, including some of those participating in the ‘hardest hit’ campaigns, have colluded with the ConDem government’s plans to destroy Remploy. He was joined by other Socialist Party members, including Andrew Price from Cardiff Trades Council, whose message that the opposition to attacks on disability benefits and services needs to be linked to the strike action of public sector workers in November, was well received.
by Ronnie Job

Remploy workers vow to fight closures

Defend disabled workers, defend jobs

Over 40 workers from the Remploy factories in Porth, Abertillery and Aberdare attended a public meeting along with 20 of their supporters to build the campaign to fight the Con-Dem government's closure programme.

In a lively meeting, Remploy workers spoke from the floor and showed their anger and their determination to fight. "They'll never get me to accept redundancy", said Jeff Hollinshead, plant convenor. "We don't own these jobs. They aren't ours to sell; we are just looking after them for those who come after us".

One worker said, "For a lot of people in this factory, this is more than just a job. It's their whole social life. Without this factory, they'd be lost".

Another explained that 95% of the 2,000 Remploy workers who lost their jobs in 2008 are still out of work. He said, "They want to replace a £21,000 a year job with a few hours stacking shelves in ASDA - and that would be for the lucky ones".

Les Woodward, national trade union convenor on the Remploy Consortium is based at the Swansea plant. He welcomed suggestions that the Welsh government could put procurement work into the Remploy factories. But he warned against any attempts to save the eight plants in Wales by sacrificing the other 46. "We can win this fight", he said, "but we need unity to do that".

Socialist Party members intend to build support through the anti-cuts Campaigns and the NSSN. They will discuss with members of PCS, Unison, the RMT and other unions the potential for campaigning for procurement in their sectors to go to Remploy plants. On 30 November, Remploy workers will be on the trade union demonstrations and all trade unionists need to give them their support.

by Mariam Kamish

Monday, 24 October 2011

Crisis in the Eurozone

RCT Socialist Update no.36
As the world economic crisis deepens much of the focus has turned to the eurozone which is currently in chaos with no way out in sight. Yet this is not simply a problem for those countries within the Eurozone but a problem for many outside of it including Brtain. Whilst the political establishment look to making more and more cuts around eurozone nations in the hope of bringing economic stability, what is becoming more and more apparent is that it is only making things worse. In reality though on the basis of capitalism the only way forward is to brutually crush the living standards of workers all across Europe.

This week the Socialist Party will be holding a joint meeting of all our branches in South East Wales in which we will discuss the current state of the European economy and what effects it will have, more importantly we will discuss future developments in the economy but also the mounting resistance to this which is growing rapidly, particularly within Southern Europe but spreading outwards from there.

Come along to the discussion and find out more about the Socialist Party and our sister parties throughout Europe and join the discssion about the socialist alternative to this capitalist chaos. In the meantime you could read this short article about the Eurozone economy here

Come along to the meeting
Wednesday 7pm
Cardiff Bus and Social Club
Tudor Street, Cardiff (5 minutes walk from central station)

Sunday, 23 October 2011

Mass movement needed to save our NHS

The following is the editorial from the socialist issue 690

In the week in which the National Audit Office announced that 80% of hospitals in England are in financial trouble and almost 50 trusts are in crisis, the House of Lords passed the Con-Dems' Health and Social Care Bill. It will now go through the parliamentary committee stages, and could be passed into law next summer.

The NHS is the biggest reform ever won by the working class in Britain. Before it was established in 1948, working class people had to save, borrow or pawn their goods to be able to afford a GP. Thousands of people suffered and died unnecessarily.

The NHS was never fully publicly-owned and controlled, as GPs were allowed to continue private practice and the pharmaceutical industry remained in private hands. However, the establishment of the NHS utterly transformed the lives of all working class people.

But for more than 30 years the NHS has faced underinvestment and privatisation. The Tories introduced the 'internal market' and established Trusts outside of democratic control. Labour poured increased public funding into the coffers of private profiteers, through PFI (Private Finance Initiatives), Independent Treatment Centres and Foundation hospitals.

Con-Dem aims

The Con-Dems' bill aims to take these steps to their conclusion and end the NHS. As legal opinion has exposed (see, the bill aims to remove the duty of the government to provide a national health service in England. As analyst Allyson Pollock has explained, it turns the NHS over to the global health market, for multinational companies to make enormous profits. A universal health service, free at the point of use, could disappear.

To try to prevent this dire scenario, thousands of people have participated in local demonstrations. Campaign groups such as Keep Our NHS Public exhorted people to lobby Lib Dem MPs and to "adopt a peer", in the hope of scuppering the bill.

Lobbying politicians can be an important component of any campaign. When faced with massive opposition, even the political representatives of big business can be forced to backtrack. This weak coalition government has already performed numerous u-turns, including their "pause" on NHS changes earlier this year.

However, at the 'Block the Bridge' event on 9 October, the day before the Lords began their deliberations, some in campaign group UK Uncut declared this was "our last chance to save the NHS". This is not true.


It is understandable that there has been a sense of desperation as the bill has gone through the Commons and the Lords. However, while lobbying can force a u-turn on more minor questions, or on particular aspects of the NHS bill, to knock the government off course on the NHS altogether would require a much bigger movement. What is at stake for the representatives of the ruling class is a huge ideological and economic question: the opening up of the hundreds of billions of pounds in the NHS to private profit.

To defeat this requires a powerful mass movement that mobilises the anger at the destruction of the NHS. Such a movement should also call for an end to underfunding and privatisation, and for the rebuilding of the NHS as a fully public service under democratic control.

It would need, to start, a national demonstration called by the health trade unions. The authority of the trade unions was demonstrated on 26 March on the massive Trade Union Congress anti-cuts demo. This would be an important step in pulling together the local campaigns and building confidence.

Crucially, however, it would need the one and a half million people who work in the NHS to use their industrial might in strike action. If the power of workers in the health service was brought together with patients and communities, a movement would develop which could force the government into significant retreat. When linked up with other public sector workers in strike action against cuts, itself a step towards general strike action of all workers, it could cause this government to collapse.

Our health service

It was the power of the working class that won the NHS in the first place. Combative trade unions, formed through struggle towards the end of the nineteenth century, argued for state medical provision. This was followed by the formation of a new political party representing workers, the Labour Party. Trade union militancy led to the first national health act in 1911 bringing in health insurance. Then after the Second World War, mass movements of workers, determined not to go back to the deprivations of the 1930s, swept across Europe. The capitalists feared for their system. An election victory for the Labour Party allowed the introduction of the NHS.

Will this kind of movement happen now? It is one thing to pass a law through parliament; as the experience of the anti-poll tax campaign demonstrates, it is quite another to implement it. The poll tax was passed into law in 1989, but was defeated by a mass movement, led by the forerunner of the Socialist Party, in 1991. We should expect that when the effects of the NHS changes deepen, hospitals close and services are sold off hook, line and sinker, a big movement is likely to develop.

In 2006, when hospitals were suddenly forced to balance their budgets and big cuts were made, campaigns sprang up around the country and tens of thousands of people demonstrated. As the NHS attacks dig in, especially alongside equally savage cuts to other services, jobs, pay and benefits, we can expect a movement to rise up that could dwarf the 2006 campaigns.

Trade union action urgent

It is criminal that so far the health trade unions, held back by timid leadership, have done almost nothing to defend the NHS. Unite the Union has at least supported some of the protests. Up until now, Unison, the biggest health union, has not acted. This is a key reason for the feelings of despair amongst some NHS campaigners.

However, 30 November could change everything. For the first time since 1982, NHS staff are being balloted for national strike action. If built for vigorously, taking national strike action alongside millions of other public sector workers, the confidence of health workers could rocket. This in turn would give a huge boost to community campaigners who could start to see how a powerful national movement can be built and put pressure on the conservative union leadership.

A crucial factor in the winning of the NHS originally was the formation of a political party which could fight for that demand, and when in power, implement it. The Labour Party has long since ceased to be that party. While Labour has opposed the latest Con-Dem bill, the last Labour government increased the pace of privatisation in the NHS and paved the way for the Tories' latest steps. It is important that the campaign to save the NHS includes the demand for a new mass workers' party that will inscribe the demand for a fully-funded, democratically-controlled public national health service on its banner.

Monday, 17 October 2011

Cameron's big 'them and us' society

The Following is taken from the socialist issue 689

There is huge support for the young people on the Jarrow March for Jobs who call for massive investment in a programme to create socially useful jobs. A recent YouGov poll found that 72% wanted to see government action to address youth unemployment.

Millions of public sector trade union members are filling in their ballots to vote for a strike against attacks on their pensions and to defend public services on 30 November. But all the Con-Dems have on offer is cuts, cuts and more cuts and misery.

While the bankers receive record bonuses for their role in the economic crisis and the number of billionaires increases, nurses and other public sector workers who provide vital services are being asked to work for free.

Tory leader David Cameron presented the 'Big Society' as empowering local communities, giving them choice and control over their services. The reality is the opposite. The Con-Dem government is attacking our public services, demanding more privatisation and cutbacks, for the benefit of big business.

For example, at Whipps Cross University Hospital Trust in Waltham Forest, north east London, all 3,400 staff are being urged to work for free.

Chief executive Cathy Geddes wrote to all staff asking them to "volunteer to sacrifice annual leave and/or perform additional unpaid sessional duties". The hospital, which is due to be merged with two other hospital trusts, is attempting to cut its £4.5 million deficit so that it can become a Foundation Trust, mandatory for all hospitals by 2015.

Many hospitals are stretched with a lot of staff already working overtime for free. As one Whipps Cross midwife said: "Many of us have already accumulated weeks of lieu days for all the unpaid overtime we do and there are no signs we'll ever get it."

It is an insult to these workers to suggest they should give up their pay while health trust chief executives enjoy an average salary of £158,800.

Hospitals already owe almost £270 million from emergency 'working capital loans' introduced in 2007 under the then New Labour government, which pioneered 'competition' (ie cuts and privatisation) in the NHS. Yet the Con-Dems are now cutting the health budget in real terms. Big businesses are lining up to take over NHS services, not to improve health care but to improve their profits.

Local authorities are also slashing services while appealing to volunteers to step in and pick up the slack. Libraries in London, Hampshire, Lancashire, Northamptonshire and Yorkshire are being threatened with closure or reduced opening hours unless local people are willing to work for free.

On the Isle of Wight, the Wight bus service has been cut completely and a new service has been set up with volunteer drivers.

Many people see through the Big Society smoke screen and are fighting against it. In many towns and cities, local anti-cuts groups have been protesting against cuts and closures.

A strong message needs to be sent to the government and local authorities that we will not stand by and watch these vicious attacks.

A mass movement against this government could stop it in its tracks. In workplaces and communities we need to build support for the 30 November strikes and to fight for properly, publicly funded services including decent jobs, pay and conditions for all.

Sunday, 16 October 2011

Brtain heading for a showdown

RCT Socialist Update no. 35

On the 30th of Novenmber pending ballot results it is likely that Brtain will see the biggest strike action since 1926 and the largest number of workers on strike in a single day. All of this because the government is intent on making working class people pay for the crisis of the rich and quite rightly ordinary people are not willing to lie back and take it.

One June 30th we saw the first co-ordinated public sector strike action of the governments attacks on public sector pensions with over 700,000 on strike, but November 30th is likely to be much larger with upto 3 or 4 million on strike. Along with this public support for the strike action is extremely high not just because of the battle over pensions but rather because this is seen by many as the frontline in the battle against all austerity measures.

November 30th will certainly go down in history as a turning point, and Socialist Party members will be heavily involved in picket lines and demonstrations on the day, but all this poses a much larger and more significant question. Where is Brtain going? How will the government respond, and what steps should we take next in the battle against cutbacks to pay for the crisis of the rich.

This week out our regular branch meeting we will have a discussion based around these topics, we will take a look at recent events and the prospects for the near future, not for the sake of it, but in order to best equip of for the unfolding situation so as to best place us for the fight for socialism. You can read a recent article from on the subject here

Come along to the meeting
Wednesday 7.15pm
Otley Arms, Treforest

Tuesday, 11 October 2011

Welsh Draft Budget: more cuts

Education, NHS, environment biggest losers as Welsh Labour passes on ConDem cuts

The Welsh Government's 2012-2013 Draft Budget, published today by Labour finance minister Jane Hutt, is the second one in a row to cut Welsh public services. 12.2% cuts to education, 3% cuts to the NHS and an average of 6% cuts to environment, housing, fire services and elsewhere across the public sector promise to make Welsh residents less healthy, less safe, and less financially secure over the coming year while hurting social mobility and wasting resources.

An 8.2% cut to higher education support calls into question how long the Welsh Government intend to keep their promise of lower tuition fees in Wales. The simple act of abolishing tuition fees in Wales for all students would likely save the Assembly money; but Education Minister Leighton Andrews' turn toward the market means that, like in Tory-run England, university students studying in Wales will pay more and get less once again. Funding to improve workers' literacy and numeracy has been cut in half, as has money for the poor to access post-16 education. Anticipating this slashing of support for education, students from half of Wales' universities have organised a demonstration and All-Wales Student Assembly against education cuts on the 21st and 22nd of October.

A 5% real-terms cut to local government will give councils across Wales an excuse to sack thousands more workers. While some trade union branches are already taking steps toward industrial action against the cuts, public-sector unions Unison and GMB can no longer make apologies for a Welsh government that takes its members' money and yet acts completely against those members' interests. A successful campaign by the FBU in 2010 turned back proposed fire service cuts in South Wales, but it is similarly clear that the Welsh Government will not relent unless decisively defeated.

A few Labour sops to the press are only intended as distractions. £288 million "added" to the NHS Wales budget is simply a slowing of £1 billion in cuts already proposed, and will quickly be destroyed by inflation which is running at 5%. An extra £1 million for the environment consists in reality of £4 million added to subsidise incineration, and £3 million cut from other areas to make up the difference. A new jobs fund will create at most 4,000 minimum wage jobs over three years -- a sticking plaster which won't even make up for the jobs lost as a result of the Assembly's other cuts.

Cuts to housing and homelessness support abandon Wales' most needy to an uncertain and harsh winter. Cuts to the Food Standards Agency just weeks after over a dozen cases of E. coli were traced to a Cardiff restaurant seem wilfully ignorant or even contemptuous.

In the whole budget there is only one winner: big business, which will receive £10 million in handouts through "enterprise zones", the aforementioned £4 million for incinerators and an additional £1.7 million through "encouraging innovation". Insurance giant Admiral, job-slashing military firm BAe and nuclear power are likely to be the greatest beneficiaries of government largess.

The government will claim, as Thatcher did twenty years ago, that "there is no alternative" to the cuts. The Socialist Party have always put forward a practical alternative, tested and proven in Liverpool Council in the 1980s: defy Cameron and Clegg, set a budget based on need and hand the bill to Westminster. If Labour in the Assembly put half the effort into such a fighting programme as they do into making excuses for implementing cuts, Wales would have all the money it needed to create jobs and build a sustainable, productive economy. Time and again they, alone and in partnership with Plaid Cymru, have failed to do so. Welsh Labour have written the budget of the Welsh Government; but we need a new, mass party, representing the interests of the working class of Wales, can write a genuine Welsh Budget.

by Edmund Schluessel

Monday, 10 October 2011

Miliband's fruitless dreams of a 'better capitalism'

The following is the editorial from the socialist issue 688.

Ed Miliband has said very little since becoming leader of the Labour Party. Many working class people, struggling to make ends meet, would have hoped that he would set out a sympathetic agenda at the Labour Party conference.

But instead he announced that the next Labour government will only spend what it can afford and that we would have to 'live within our means'. He added that: "Most of the cuts implemented by the Con-Dems will not be reversed"!

Many would ask why they should support Labour and give them their vote if it just means the continuation of Con-Dem policies? For others, because there is currently no mass workers' party which puts forward a real alternative to the Con-Dem cuts, there is a hope against hope that Labour will be able to get rid of the Tories, and stop at least the worst of the cuts.

Even though Miliband never mouthed the word "socialism" at the conference, we were told by his supporters that socialism was "implicit" in his speech!

Martin Kettle wrote in the Guardian that Miliband's speech "adds up to an attempt to reclaim social democracy as Labour's core route-finding principle".

Miliband is looking towards a new, better capitalism. He implied that there are good and bad capitalists (producers and wealth creators are 'good' while predators and asset strippers are not).

Miliband claimed that his alternative is a kinder capitalism, one that is not so aggressive. He argues that it was neoliberalism that caused the current crisis and not capitalism as such. But in reality capitalism will always ensure that the wealthy will make profits at the expense of ordinary workers.

There can be no return to the period of social democracy after World War Two when there were uniquely high levels of productivity and growth and workers were able to win some reforms including the NHS. Today capitalism is in its most profound crisis since the 1930s. The capitalists have no real solution, and as a result are divided on the way forward, but there is agreement that it should be the working class that pays for the crisis.

There is no possibility of Miliband opposing this, as was confirmed by his reaction to the suggestion by most of the capitalist media that he had moved leftwards and wanted to attack predatory bankers. Had he actually done so it would have been popular with workers, but he spent the next day vigorously denying he had said any such thing!

Incredibly Miliband also spoke about 'good' and 'bad' social housing tenants. With a shortage of social housing he stressed that "choices have to be made". He argued that people in work should get priority for social housing, thereby punishing the unemployed and poor.

He also said that benefits were "too easy to come by for those who don't deserve them and too low for those who do". This approach will potentially create divisions among the working class and worsen the plight of the most vulnerable.

Public sector union PCS general secretary Mark Serwotka opposed this at a conference fringe meeting. He explained that this would lead to a "different kind of welfare state with working people getting priority over the unemployed." He pointed out cold facts like in Merthyr Tydfil there are 1,500 people on jobseeker's allowance chasing 39 vacancies!

Many families are already relying on food donations from charities to survive. One charity reports that the number of people that it donates food to has gone up from 41,000 to 61,500. This is the result of job losses, low pay and rising prices.

Unlike the Tories' rich donors, those unions who generously fund the Labour Party and were key in electing Miliband as Labour leader last year get little for their money. Miliband told the TUC conference that strikes are a 'mistake' and opposed the planned public sector strikes over pension attacks on 30 November.

Both Len McCluskey, general secretary of the Unite union and Dave Prentis, general secretary of Unison gave support to Miliband. But Prentis received a standing ovation when he demanded that Labour should support the strikes if they went ahead.

Miliband even praised Margaret Thatcher for ending the 'closed shop' (where workers could only take up a job if they were in the union) and forcing trade unions to hold strike ballots before being able to take action.

Those unions who fund the Labour Party will face increasing anger from their members about union money going to a party that won't support their strike to defend their pensions or commit to repealing the anti-trade union laws.

Miliband also called for "cooperation not conflict in the workplace". Yet trade unionists know that it is the bosses and management who have to be dragged to the table by the unions in order to negotiate.

The trade unions set up the Labour Party. They will need to pay a key role once again - in founding a new party that stands in the interests of the working class.

Sunday, 9 October 2011

Come to Socialism 2011

RCT Socialist Update no. 34

Socialism 2011 is fast approaching., it is an excellent event that no socialist, trade unionist or ani cuts campaigner will want to miss. The event is a weekend of discussion and debate hosted by the Socialist Party. With a range of discussions taking place over the course of the weekend the hardest decision every year is which sessions to attend as there are so many good sessions to choose from.

Some of the sessions include "What would a socialist democracy look like", "How can the masses of the Middle East win?", "What future for young people", "How can the anti-cuts movement win?", "20 years since the collapse of the USSR: proof that socialism doesn't work?" a debate with UKUncut and many more sessions.

As well as this there will be a Rally for Socialism on the saturday evening with speakers such as Peter Taaffe, general secretary of the Socialist Party, Clare Daly, Irish Socialist MP and activists from Egypt and Tunisia. Followed by the Party for Socialism.

This years event will start of with a bang as it coinsides with the arrival of the Youth FIght for Jobs Jarrow marchers at the end of the 5 week march from Jarrow in the north of England to London who will be met by 1000s of trade unionists, socialists and anti-cuts activists for a fantastic demonstration through trafalgar square.

Socialism 2011 takes place on the weekend of the 5th and 6th of November, there are a range of ticket options available depending ranging from single day tickets, weekend tickets and tickets including accomodation. For more details, including the full programme of events or any other quires and to book tickets and transport you can visit or call us on 07931955007.

In preperation for the great event this week at our regular branch meeting wie will be hosting an open question and answer session on socalism and the Socialist Party, any questions you have or just want to come along and find out more, then come along and join the discussion.

Wednesday 12th October, 7.15pm
Otley Arms, Treforest.

Wednesday, 5 October 2011

Eurozone endgame

The following is taken from the October edition of Socialism Today issue 152

After a year and a half, the Greek debt crisis is far from resolved. In fact, with Greece on the verge of a social explosion, a default and exit from the euro appears almost inevitable. The eurozone is threatened by an interlocking sovereign debt and banking crisis, compounded by near-zero growth. Capitalist leaders are in complete disarray. Competing national interests are a barrier to cooperative measures. LYNN WALSH analyses the latest twists and turns of the eurozone crisis.

ON 21 JULY, the eurozone leaders proclaimed at their summit that they had agreed on a package to stabilise the Greek debt crisis. This, they claimed, would avert the threat of a Greek default and precipitous exit from the euro. There would be a further €109 billion (following the 2010 €110bn package), while the role of the European Financial Stability Facility (EFSF – with proposed €440bn funds) would be extended to allow intervention to support governments and banks. There would, moreover, be a bond exchange that would involve a 21% ‘haircut’ for the holders of Greek bonds.

This package, however, was more a promise of future salvation than an immediate, practical solution. The whole deal is dependent on the approval of the 17 eurozone governments or parliaments, and this is not likely to happen until the end of September or the beginning of October. The 20% ‘haircut’ for Greek bonds will provide very minimal debt relief for the Greek government – Greek government bonds are already trading at less than 50% of their nominal value on the secondary bond markets. If the bond exchange goes through (it requires the agreement of 90% of the bondholders) it will be a good deal for the banks and a raw deal for the Greek people. In fact, it would require a ‘haircut’ of at least 50-60% to make any real difference to the debt mountain weighing down the Greek economy.

There is no guarantee whatsoever that all 17 governments will agree on an increase in the funds available to the EFSF or to increased powers of intervention. The eurozone leaders are reportedly arguing in tense, behind the scenes negotiations about where the EFSF funds will come from. Some leaders are proposing that they would mainly come from the European Central Bank (ECB). This would be, in effect, another form of ‘quantitative easing’, printing money in order to bail out governments and banks through the EFSF. This is strongly opposed both from within the ECB and by a number of governments, such as Germany and Netherlands, who see it as a road to escalating inflation. Regarding the €109 billion loans package, the government of Finland is demanding collateral (security) for its share of the loan. Other governments, such as Slovakia and Austria, are likely to make similar demands. These governments are demanding that a slice of government revenue or physical assets, such as land or buildings, should be allocated to them as security. This is reminiscent of the demands for reparations made on Germany after the first world war.

The wrangle over this new package demonstrates once again the way national interests stand in the way of common agreement. The 17-strong eurozone is an alliance of national states, not a confederation with a unified governing body.

Soon after the July summit, moreover, there were precipitous falls in the shares of major French banks, reflecting fears about the repercussions of a Greek default. At the same time, European banks were finding it increasingly difficult to borrow dollars from US banks to finance their current business. The ECB, which under Jean-Claude Trichet had been extremely reluctant to intervene, was forced to step in to offer unlimited dollar loans to eurozone banks. The ECB also started buying the bonds of the Italian and Spanish governments in order to prevent a precipitous rise in the borrowing costs of Italy and Spain.

Meanwhile, growth in all the major eurozone economies slowed to near zero, indicating a renewal of the recession that began at the end of 2007. The British economy also slipped into stagnation. This renewed slowdown is partly the result of fears about a sovereign debt meltdown and banking crisis, but more especially the result of austerity measures that have cut demand and reinforced the spiral of weak demand, falling investment, and rising unemployment. This in turn reduces government tax revenues, and actually leads to bigger deficits.

Piling the pressure on Greece

AT THE EUROZONE summit on 17 September, the troika – the European Council, International Monetary Fund (IMF) and ECB – who police the austerity measures imposed on Greece, postponed payment of the latest €8 billion loan due under the 2010 package on the grounds that Greece has not carried out sufficient cuts in state employment, spending, etc. Georgios Papandreou, the Greek prime minister, duly scurried back to Athens in order to carry out the troika’s orders.

The package of additional austerity measures includes a property tax, together with more public-sector job losses – on top of the plan to sack around 150,000 civil servants (20% of the total) by 2014 – and draconian wage cuts. If implemented, the accumulated measures will mean an economic and social catastrophe. The troika is "holding a knife to the throat of the Greek government", as one Greek minister put it, partly to enforce deeper and more rapid cuts and partly as a warning to other governments like Portugal and Ireland to keep to their austerity packages. This is a very dangerous game, however, and could detonate a political explosion in Greece, propelling the country towards default and exit from the euro.

Economically, there is no way these measures will provide a way out of the ever deepening slump. In fact, further austerity measures will only push the Greek economy even deeper into slump, pushing up the outstanding debt and making it even harder for Greece to pay it off. After falling 4.5% last year, GDP will fall by at least 5% this year (second-quarter growth was 7.3% down over last year). Unemployment is officially 16%, but more realistically is over 20% nationally (with over 900,000 unemployed). The northern region of western Macedonia, where an estimated 20% of small businesses have shut down during the recession, has an official unemployment rate of 22%. Health, education and other public services are collapsing. There is a process of social disintegration.

Angela Merkel and other eurozone leaders have repeatedly denied that they are seeking to provoke a default on Greece’s debt or force Greece out of the eurozone. Other leaders, however, appear to contradict this line. For instance, Wolfgang Schäuble, the German finance minister, has threatened that if Greece does not meet the conditions set by the troika, payments will stop (regardless of the fact that Greece urgently needs cash to pay its bills and refinance debts in October). "Then Greece has to see how it gets access to financial markets without help from the eurozone", said Schäuble. "That’s Greece’s problem".

The Netherlands prime minister, Mark Rutte, went even further: "Countries which are not prepared to be placed under administratorship can choose to use the possibility to leave the eurozone". (International Herald Tribune, 9 September)

It may be that some of the eurozone leaders are bluffing, and their statements are intended to maximise the austerity measures implemented in Greece. However, they are playing an extremely dangerous game. Christine Lagarde, the head of the IMF, has recently warned about the rise of social tensions as a result of austerity measures. Massive strikes, demonstrations and other protests have continued unabated in Greece – and, at a certain point, will result in a social explosion.

Debt default and eurozone exit

PUSHING FOR EVEN greater austerity measures, eurozone leaders are ignoring the reality that Greece’s debts are absolutely unsustainable. While political leaders are repeatedly stating their determination to defend the eurozone and avoid a breakup, strategists closer to the investment banks and other financial institutions are quite clear that, sooner or later, there will be a Greek default. That would mean a Greek exit from the eurozone.

For instance, Nouriel Roubini, who has a far more realistic view than most commentators, argues that Greece will never resolve its debt problem within the straitjacket of the euro. In order to stimulate economic growth, the precondition of debt reduction, Greece would have to be able to devalue its currency in order to boost exports. Clearly, this would mean abandoning the euro and returning to the drachma. The drachma would undoubtedly sharply fall in value against the euro. This would enormously increase the foreign debt, in drachma values, of the Greek government, banks and businesses. In reality, Greece would (like Argentina in 2001) have to write off a significant part of these debts by revaluing the debt in drachma terms. Greece would undoubtedly become a pariah on financial markets, unable for a time to borrow from European and international banks. As in Argentina (comments Roubini), the situation would mean ‘bank holidays’ (denying or limiting savers access to their accounts) and capital controls to prevent a flight of capital out of the country.

Roubini argues that an orderly default and exit from the euro, although inevitably imposing extreme hardships on the Greek working class for a period, would be preferable to the "slow disorderly implosion of the Greek economy and society". He argues that there should be international, coordinated action to recapitalise the banks and other financial institutions suffering losses on their Greek loans. Moreover, international banks should step in to recapitalise the Greek banks, which would also suffer massive losses on Greek government bonds.

In theory, an approach along these lines, based on a coordinated, international intervention to mitigate the problem of unsustainable debt in Greece, would be preferable to blundering into an explosive collapse of the Greek economy and all the uncontrolled repercussions this would have in Europe and beyond. However, the capitalist markets do not function in an ‘orderly’ way, and recent events demonstrate the complete lack of policy coordination between the leaders of the advanced capitalist countries.

Default on the country’s debt and exit from the eurozone would not, in themselves, provide a solution for the working class of Greece. As in Argentina 1999-2002, the Greek ruling class would attempt to throw the burden of crisis onto working people. In time, the return to the drachma and devaluation would boost exports and possibly see a return to growth. In the short term, however, this would be on the basis of low wages, shortages of food, fuel and other essentials, and a degradation of public services.

To protect the interests of the working class it would be necessary to nationalise the banks and cancel the debt held by foreign big business and financial institutions, while protecting the savings of working people. It would also be necessary to take over the commanding heights of the economy (with minimum compensation on the basis of need) to ensure the supply of essential goods and services. Priority should be given to reconstructing public services such as health, education, etc. Control of the economy should be through bodies of democratically elected representatives from the trade unions, community organisations, and the wider public. On a capitalist basis there is no easy way out.
Eurozone banking crisis

THE EUROZONE SOVEREIGN debt crisis is interlinked with a Europe-wide banking crisis. In 2008, eurozone governments intervened to bail out a number of shaky banks. But they did not carry out the kind of large-scale recapitalisation of banks that took place in the US under the Troubled Asset Relief Programme. Only eight eurozone banks out of 91 failed the recent ‘stress tests’, a theoretical test to determine whether banks can withstand another financial crisis. The big investors and speculators, however, are not convinced that all the banks are healthy. In fact there was recently a leaked IMF report which said that eurozone banks need €273.2 billion of additional capital. Lagarde commented that the eurozone crisis was entering "a dangerous new phase" and called for part of the EFSF funds to be used to recapitalise banks. This provoked strong opposition, some from political leaders who object to EFSF funds being used to prop up banks, and some from the banks themselves which deny that they are in trouble.

Nevertheless, there are clear indications of a new crisis building up in the eurozone banking sector. For a start, banks are refusing to lend to one another, preferring to park their cash in the ECB, even if this earns them a lower interest rate. A more startling recent development is the fact that Siemens, the giant German engineering firm, has deposited almost half its cash reserves (€6bn) with the ECB, rather than with commercial banks. Eurozone banks have also had difficulty in securing dollar loans from US banks, vital funding to conduct their US and global business. The ECB was forced to step in and offer eurozone banks unlimited dollar funds on the basis of three-month loans (though this will cost the banks more than loans from the commercial money markets, which have begun to dry up).

In mid-August the focus turned to the French banks. A rumour circulated that Société Générale was in trouble, and there was a massive fall in its share price (with a 50-60% fall between June and September). Société Générale shares were worth €52.7 in February, while by early September they had fallen to €21.19. Société Générale holds €2 billion of Greek bonds, while BNP Paribas holds €4 billion and Crédit Agricole holds €800 million. Big investors and speculators fear that a Greek government default on its debts would precipitate a deep crisis for these three major French banks, which play a key role in the French economy. French government ministers assert that the fears about these banks are ‘irrational’. Any short-term liquidity problem (ie a shortage of funds to cover current business) would be covered by intervention by the ECB. They deny that there is a basic solvency problem, asserting that these banks have enough capital reserves to survive a Greek default and other shocks. French ministers have furiously rejected the idea that they are discussing plans to nationalise these banks. This is reminiscent of the position of Gordon Brown and Alistair Darling at the time of the Northern Rock bank crisis in 2007/08.

Lagarde, however, let the cat out of the bag. When she was previously French finance minister, she claimed there was no problem with the French banks. Since taking over as head of the IMF, however, she has called for a recapitalisation of the major French banks and other banks in trouble using the EFSF funds. There has been a furious reaction against this. On the one hand, any such bailout would confirm that these banks have a solvency problem, and could actually exacerbate their situation. On the other, existing shareholders are up in arms because a government bailout (which would involve the government buying shares in the banks) would effectively dilute the value of shares of existing shareholders.

Eurozone leaders’ disarray

UNDER THE IMPACT of the economic crisis there has been a sharpening of national tensions within the eurozone. There are also divisions within the leadership of the German government, the key power in the eurozone. Merkel has faced growing opposition from leaders of the Bavarian Christian Social Union (CSU) and the Free Democratic Party (FDP), the Christian Democrats’ coalition partners. These leaders have been playing the euro-sceptic card, reflecting the growing opposition in Germany to bailing out Greece and other so-called peripheral states.

The lack of decisive action at eurozone summits shows that the eurozone leaders are in complete disarray. Each time they proclaim everything will be fine, Greece will not be allowed to default or be pushed out of the eurozone. The big investors in financial markets, however, do not take these reassurances seriously. Most of the strategists who speak for investment banks, etc, now believe that a Greek default is inevitable and will result in an exit from the eurozone.

The leadership of the ECB is also divided. While buying Greek, Portuguese and Irish government bonds in order to keep down interest rates for their respective governments, Trichet and other ECB leaders repeatedly stated that they were against large-scale intervention to support other eurozone governments. However, the speculation against bonds of the Italian and Spanish governments, which was forcing up their interest rates at the beginning of September, forced the ECB to intervene with large-scale purchases of these bonds. This provoked the resignation of the German representative, Jürgen Stark. There is now an intense battle between those ECB leaders who believe that an even bigger intervention is required. They argue that unlimited support for the bonds of threatened governments would stave off a sovereign debt crisis. However, other ECB leaders are still intransigently opposed to this kind of intervention. They believe that the ECB’s role should be strictly limited to monetary policy, ie setting interest rates and regulating the money supply.

There is also a growing difference between capitalist leaders over economic policy. The prevailing policy, upheld by Merkel and other eurozone leaders, is that ‘fiscal consolidation’ is imperative to reduce deficits. This means severe austerity policies. However, this has produced a new downturn in the European economy and, as Timothy Geithner, the US Treasury secretary, has warned, now threatens the whole global economy. The fall in government spending and massive cuts in public-sector jobs have set in motion a downward spiral: declining consumer spending, weak investment, higher unemployment, and a decline in tax revenues that can result in even bigger deficits.

The ultimate stress test

A WARNING WAS recently sounded by Lagarde. While advocating continued austerity for countries like Greece, she is – without naming names – calling on the major European economies to adopt short-term stimulus measures, while maintaining the aim of fiscal consolidation in the longer run. She warned: "A vicious circle [of weak growth and weak government balance sheets] is gaining momentum in Europe and the US". "Political dysfunction" was feeding policy indecision in a "dangerous new phase of the crisis". "Social strains", she warned, "are evident in many parts of the world, not just in the countries undergoing severe [fiscal] adjustment". (IMF, 15 September)

Since then, the IMF has published its latest economic outlook. This forecasts global growth for 2011 to be 4%, but warns that, unless there is concerted action to revamp economic policies, there is a strong possibility of growth falling below 2%. In the US and Europe, growth will certainly be under 2% and is likely to be virtually stagnant, while there is zero growth in Japan. But, as the Wall Street Journal comments (21 September): "It is unlikely that either the IMF or the G20 will manage to produce a cooperative plan of action this weekend, given the sharp political discord within the US and Europe".

However, it may be too late for the major capitalist economies to avoid a prolonged stagnation or a further downturn. The ruthless pressure on Greece to intensify the austerity measures can detonate an explosion in that country, which in turn would detonate a meltdown of the eurozone. It is hard to imagine that Greece could default on its debt and remain in the eurozone. That would undermine the credibility of the whole eurozone. In any case, the only way Greek capitalism could escape from its crisis would be through readopting the drachma and devaluation. And if Greece takes this path, why should others stick with the pain of eurozone austerity measures?

On the basis of the relatively strong growth of the world economy since 2000, the eurozone appeared to become a success. But the growth was based on huge volumes of debt, which are now at the heart of the current crisis. Since the financial meltdown and economic recession of 2007-09, the eurozone is being subjected to a severe stress test – from which it will not emerge intact. At a certain point it will break up; but how long the process will take and through what permutations it will twist and turn cannot be predicted. The eurozone has entered its endgame, only the moves and timescale are uncertain

Tuesday, 4 October 2011

Mass strikes can kick out Con-Dems

The following is taken from the socialist issue 687

On 30 November, two to three million public sector workers will be on strike to defend their pensions. More workers will be out than on the first day of the 1926 general strike.

The NSSN is proud of the role that it's played in paving the way. On 11 September we lobbied the TUC Congress and held a rally under the slogan of a 24-hour public sector general strike. Over 700 shop stewards and trade unionists listened to leading union speakers such as Mark Serwotka of the PCS and Bob Crow of the RMT.

This government of millionaires can be defeated by coordinated strike action. Millions of workers striking together can stop the Con-Dems in their tracks. And if one day is not enough to force a u-turn, we must prepare for a two-day strike as the next stage of the escalating action.

In all the workplace meetings, shop stewards' committees and union branch committees, the message has to be hammered home that workers shouldn't pay the price for the bankers' crisis.

Workers have shown their determination to fight at every opportunity they've been given this year. Over 500,000 marched against the cuts in London on 26 March and over 750,000 civil servants, teachers and lecturers went on strike against the pension attacks on 30 June.

But the first job for 30 November is to win the strike ballots with an overwhelming vote. Meetings have to be organised in every workplace. Where there is more than one union, these could be joint meetings. Members of the PCS, NUT, UCU and ATL unions who were out on 30 June and have live strike mandates should be invited to speak. This can give confidence to the many workers who haven't been on strike before.
These can be supplemented by public meetings and rallies in towns and cities and on estates to draw in other working class people - young people and all those who suffer from and oppose the cuts, including private sector workers who also face job losses and pay and pension cuts.

The NSSN encourages all private sector workers involved in current disputes to consider coordinating their industrial action with the strike on 30 November. As Mark Serwotka said at the NSSN rally on 11 September: "Low-paid workers in the private sector are exploited by shareholders and executives, not by fellow low-paid workers in the public sector."
A victory for public sector workers on pensions, by forcing a retreat or even the downfall of this government, would raise the confidence to fight back.

What you can do:

  • If your union is balloting, you could organise a workplace meeting, if applicable jointly with other unions. This should form the basis for democratic control of the strike
  • You could organise a public meeting in your town or city with the unions in dispute or trades council, anti-cuts campaign or NSSN. Explain the need to prepare for further action if necessary  
  • Plan a demonstration in your town or city on the day of the strike  
  • All united - invite private sector workers, young people, unemployed, pensioners, etc to any public meetings, rallies and demonstrations

Socialism or Anarchy?

RCT Socialist Update no. 33

As the economic crisis is ridden out comfortably by the rich whilst it is us ordinary people who are paying the price in the most savage of ways across the world. Capitalism as a system is being openly questioned and many are rightly coming to the conclusion that is it a thoroughly corrupt sysem run in the interests of the rich by exploited the majority of us.

The only questions which remains for so many people is what do we replace capitalism with. So many working class people are looking for alternatives and the most common are those of Socialism and of Anarchism. This week at our weekly branch meeting the discussion will focus on these distinct ideas what their similiarities are and what the differences are, but most importantly which of these ideas can be put into practice to produce an equal society.

Inevitably the discussion will reflect the view that socialism forward and the only viable replacement for capitalism. Come along and find out the reasons why or to ask any questions, if you disagree come along and argue you rpoint this us and join the discussion. In the meantime you can read this short article about Socialism vs. Anarchism here

Come along to the meeting
Wednesday 5th, 7.15pm
Otley Arms, Treforest