1990s >> 1998 >> no-1131-november-1998

Won’t – or can’t?

Does the globalisation of capital mean that national governments are powerless to control capitalism or is it just that they don’t want to?

Now they tell us. When Siemens closed its semiconductors factory in North Tyneside Peter Mandelson, newly appointed as Trade and Industry Secretary, declared: “This is a product of global changes, which are completely outside our ability to control” (Soapbox, Sunday Sun, 16 August). A month later when Fujitsu announced the closure of its factory in his own constituency nearby, Blair “admitted that the Government could do little about the ‘twists and turns’ of world markets” (Times, 17 September).

For once, Mandelson is telling the truth. The government is powerless to change world market conditions. Far from governments being able to control economic conditions, it’s the other way round: governments have to tailor their policies to fit in with global economic conditions. As the moment these conditions are difficult in that competition is much fiercer than it was until the early 1970s when the world market was expanding much faster than has been since. Governments have had to take this into account and bow to world market pressures to keep costs down by cutting back on their social spending. They have had no choice. To paraphrase a mad woman who was a Prime Minister in Britain in the 1980s, you can’t buck the world market.

There are some who disagree with this—the anti-Labour Left, amongst whom are to be found some of the most incorrigible defenders of reformist political action. They think you can buck the world market. According to them, it’s just a question of political will and mass pressure

As Robin Clapp put it in an article entitled “Global Myths” in Militant’s theoretical journal:

“National governments do have the power to maintain welfare systems, vary taxes and interest rates and set economic priorities. The problem today is that capitalist governments don’t want to resist international capital, not that they are incapable of it” (Socialism Today, April 1996).

The view is echoed by the SWP. In a review, entitled “No Place Like Home”, of a book that challenged the extent and consequences of the globalisation of capital (Globalisation in Question by Paul Hirst and Grahame Thompson), Chris Harman argued that radical action within a national framework could still overcome world market pressures:

“Capital may be able to shrug off attempts by government to control it using the limited techniques of ‘Keynesianism’ and social democratic intervention. But it can be challenged successfully by those prepared to take much more radical action—the sort of action open only to those who base themselves on the mass mobilisation of its workers” (Socialist Review, May 1996).

Harman may have been talking about trade union struggles as well as about reformist movements to put pressure on governments but, contrary to what he implies, trade unions have even less power to “successfully challenge” world market forces than governments. Not only have there not been any reforms, as improvements for workers brought about by government action, since the early 1970s, but all the big trade union battles in recent years have been purely defensive. Indeed, many such battles-Wapping, the Miners, P&O cross-channel ferries, the Liverpool Dockers—have ended in defeat. We are not saying that workers should not engage in such defensive, rearguard actions—there is some room to stop conditions worsening as much as the bosses would like or try on—but they should be recognised as such, as precisely battles to stop things getting worse, retreats imposed by current world market conditions.

That’s more like it

However, there does not seem to be unanimity within these organisations as to whether, and to what extent, capitalism in it current depressed sate can offer reforms.

Tony Saunois, of the secretariat of Militant’s international body the “Committee for a Workers International”, has put a somewhat different position from Clapp:

“The influence of the world market currently determines the policies pursued in each country. No country has been able to escape its influence. It has been one factor which has prevented the implementation of reformist policies. This is likely to be the case in the short to medium term.”


” . . . the decisive feature is the dominance of the world market. This has rendered the application of distinct and separate polices within national boundaries impossible for any length of time. This is especially the case for policies of a reformist or left reformist character”.

And, after giving the example of the failure of the Mitterand government in France in the early 1980s and of a leftwing coalition in Venezuela in the 1990s:

“These examples illustrate the domination of the world economy and show that the material basis which allowed capitalism to implement lasting reforms in the post Second World War decades no longer exists. Temporary concessions may be given by a government threatened with massive social explosions. However, they will rapidly be taken away again because of the limitations of the resources of capitalism” (The Future for Socialism, second printing, January 1997).

This is a position we can endorse, indeed have been putting forward ourselves.

Similarly in the SWP, Peter Green (who wrote a passable pamphlet for them on The World Crisis of the 1980s) in a letter to Socialist Review (June 1996):

“We are now in a world where all talk of national reformism is fantasy—which was not true in 1945 or 1914. International socialism really is the only hope for us all.”

If international (or, as we would prefer, world) socialism is the only hope for us all—as it is—then the logical conclusion is that what we should be doing is campaigning in favour of this, not to try to pressurise governments to “maintain welfare systems, vary taxes and interest rates and set economic priorities”.


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