Economics Policy Commission draft

Draft document for policy conference March 2014 (As amended at Policy Commission on 01.03.14)

Introduction – The Economic Context

The global financial crisis which erupted in 2008 triggered the worst economic slump in many economies since the early 1930s. Six years on output had still not recovered to its previous peak in much of Europe, including Britain. Debt-ridden economies within the Eurozone have been devastated by austerity packages primarily designed to ensure banks and other creditors are repaid regardless of the long-term economic and social consequences.  As in  the 1930s and 1980s, the mass of working people are being forced to pay the costs of a crisis   for which they were not responsible whilst the wealthiest 1% continue to rake in bonuses, and stuff their bank accounts in tax havens.

The crisis was precipitated by the excesses of global financial markets but has also exposed the chronic instability and grotesque inequalities which have characterised free-market globalising capitalism since the 1970s. In Britain we are suffering from the consequences of 30 years of what is known as ‘neo-liberalism’ – the privatisation of publicly owned services and utilities, the deregulation of financial and other markets, the pervasive marketization of everyday life, and a sustained onslaught on the gains won by the labour movement in the period from the end of the second world war after 1945.

At the time of writing (March 2014) Britain is experiencing a recovery for the few. Average real wages (after taking into account inflation) are still at least 6% below their level in 2008 with the average worker £30 a week or £1500 a year, worse off.  Cuts in public-sector jobs continue apace, disproportionately hurting women, ethnic minorities and some of the poorest regions in the country.

It is a myth that there is no money available. Private sector corporations were sitting on cash reserves of £671 billion (almost 50% of national income) in 2013, which they were unwilling  to invest productively. The Bank of England has pumped many billions more into the financial markets preventing further collapse but also fuelling another round of house price inflation in London and the South-East, whilst much of the country remains trapped in stagnation or decline.  Banks are reluctant to lend to any small business which actually needs the money, whilst handing out huge sums to buy-to-let landlords and property developers. Radical measures are necessary to ensure a transformation in the economic structure and a reversal of the damage inflicted over the last 30 years of attacks waged by the rich and powerful on the rest of us.

 

An Immediate End to Austerity and Cuts in Public Services

The Economic Policies proposed by Left Unity must necessarily  need to change in focus over time whilst retaining the core principles on which the party was founded.

At this point we call for an immediate

  1. Reversal of the cuts in public spending and the austerity package pushed through by the Conservative Government and an expansion of public spending in pursuit of a policy of full employment (see below)
  2. End to privatisation of public services in health, education etc, a reversal of outsourcing at all levels and a scrapping of the so-called Private-Public Partnerships and PFI schemes (see other commissions for more detail on these proposals)
  3. Abolition of zero-hours contracts and the use of agencies to evade European legislation on employment rights (along with all the anti-trade union legislation introduced by the Tories but retained under New Labour)
  4. Raising of  the minimum wage up to the level of a living wage linked to measures of the cost of living (with a higher rate to cover additional housing costs in London and comparable areas) and to the European decency threshold.
  5. Reversal of those changes to the tax system which have hurt the poor (we would lower VAT to 15% as a first step) and benefited the rich (we would restore the 50% rate of tax on incomes above £75,000 received by the richest 2%) with further changes outlined below

A Strategic Vision of Structural Change and A Different Society

Left Unity, since its founding conference, is committed to the principle of production for meeting human need not primarily for profit, or ‘people not profit’. We are  environmentalist, feminist and socialist and all these traditions of thought have influenced the proposals below for  fundamental structural change in Britain. Ultimately our vision is a society organised on completely different principles from those which govern capitalism:

  1. The principle of from each according to their ability, to each according to their needs.
  2. An end to the short-termism which prioritises the extraction of resources such as oil and gas despite the risk of long-term destruction of our environment.
  3. An internationalism which recognises that in a world of global capital and finance we cannot put an end to capitalism in one country alone nor abolish Britain’s reliance on exchange and trade with both Europe and the rest of the world. There need to be global solutions to global problems such as  climate change.

Left Unity as a broad party contains a healthy diversity of views on how a socialist society could be attained. We are under no illusions that any such programme  can be implemented without meeting resistance from the richest  1% in Britain and elsewhere, especially those elites who control transnational corporations and global finance. However what we can seek to achieve in Britain, in association with other similar left parties across Europe, are fundamental changes which

  1. Reverse the impact of 30 years of so-called neo-liberalism ( ie privatisation, deregulation, and the widening obscene inequality of wealth and income  between a tiny 1% – or 0.1% of the very rich – and the vast majority of people).
  2. End  the  dominance of the private financial sector, and the City of London in particular, within the economy and over Governments formed by all main political parties.
  3. Shift resources towards those areas of the country which have suffered from decades of deindustrialisation (the closure of factories, mines, shipyards etc.) and high long-term unemployment,
  4. Would be part of a national plan for regeneration of the economy (together with proposals from other commissions on education, health, housing etc.) which as a priority would reverse the chronic structural imbalances between the bloated financial sector and other parts of the economy, and between the wealthiest and the most deprived communities.
  5.  Respond to the threat of climate change with measures which take into account the full social costs of current policies for energy, transport and the natural environment.

We recognise the obstacles to implementing any such programme of structural reforms. The response of Labour Governments to threats of capital flight and investment strikes has always been to capitulate. However:

  1. We would help to build international networks of solidarity to support any government introducing such measures within Europe and elsewhere.

Employment Policy

 Full employment, as existed in the postwar period up until the 1970s, should be a primary objective for any left government. But we  recognise that the type of jobs created and their conditions and pay also matter.  All the policies outlined here will contribute to a dramatic reduction in both    unemployment and underemployment (part-time workers who seek more hours).  In particular we would prioritise

  1. Green Jobs: Electricity generation and transmission, transport and the heating and cooling of buildings account for 83% of greenhouse gasses emitted in Britain annually and it is vital that we adopt a twin track strategy of ‘powering down’ (reducing energy wastage) and ‘powering up’ (hugely expanding our generation capacity by developing and deploying zero carbon technologies based on wind, sun and water). This strategy would require a massive infrastructural investment and reconstruction programme prioritising the rapid development of three key sectors – energy generation and transmission, construction and transport – and the creation of hundreds of thousands of new and sustainable jobs. Such a major programme of public investment and employment would not only lead to major regeneration in other key industrial sectors, but to rapid growth in R&D in sustainable and socially useful technology and stimulate the demand for graduates from almost all areas of tertiary education and/or training.

16.    Purple Jobs: The term refers to jobs in the caring sectors which are being remorselessly cut by local authorities as a result of national government reductions in their funding. We would not only reverse those cuts but significantly expand the public  sector (which currently mainly employs women) ensuring that labour necessary for the society no longer faces low wages and increasingly casualised and precarious conditions of employment. These are jobs which are critical for support for disabled people, the sick and the rapidly growing numbers of older pensioners. They are also jobs in childcare which would be provided for free to all those with children below school-age. Job creation in a unionised public sector in these areas will serve to strengthen unions and collective bargaining and raise pay levels generally.

(The purpose of Purple job creation is to free women from primary caring responsibilities which have led to their concentration in part-time work, discontinuous labour, and involuntary underemployment. Ending segregation of the labour market where women are consigned to low pay and underemployment to enable them to provide caring for children, sick, disabled people and the elderly, these jobs will enable men and women to work in this sector. This is a step towards ending women’s unpaid personal labour at home enabling their full participation in employment and enabling their access to education, personal development and economic independence.)

17. Creation of Vertically Integrated Cooperative Sector as part of a general national economic plan for the economy. A vertically integrated sector is one which produces all inputs and outputs from initial production to consumption goods. A workers’ owned and operated sector (that is locally or regionally based) can be targeted initially to revitalise areas of the country that are suffering from severe unemployment under worker’s control and management as part of a transformational project away from a capitalist competitive basis towards cooperative organisation of work.  Initial startup funds and investment will be provided by the national government at zero interest.

18. A Reduction in the Standard Working Week to 35 hours in the first instance, with further reductions over time and corresponding adjustments to the hourly living wage. For those paid less than the median wage, no loss of income will be incurred due to reduction in working hours. All additional hours over 35 are to be voluntary at overtime rates of pay, negotiated under collective agreements with trade unions.

The Banks and Finance

The financial crash of 2008 exposed the damaging consequences of deregulation of the banking sector since the 1970s – and the disastrous consequences of having the City of London operate as a global financial centre divorced from the rest of the economy. Even partial socialisation (to cover the losses) of banks such as Lloyds and RBS has not changed how the banks operate or put an end to multi-million pound bonuses

We propose

  1. 19.  An extension of the publicly owned banking sector to embrace all the major British owned banks, building societies and insurance companies. New forms of governance, combining control  by elected representatives of finance workers  and  local communities and government, would scrap the bonus culture and direct credit to the most socially desirable forms of investment. Compensation in the form of fixed-interest government bonds could be provided, eg to pension funds, depending on the results of an audit of shareholders.
  2. 20.  A tax on financial transactions (sometimes known as a Robin Hood tax) which across the EU would both raise revenue and significantly reduce the scale of speculative cross-border financial flows.
  3. 21.  Tighter regulation over all forms of financial activity, especially  capital controls on cross-border movement of funds by institutional investors, hedge funds etc , although these would be difficult to implement in Britain alone and we should seek effective European-wide (if not global) regulation where possible.
  4. 22.  Reform of pension funds, many of which are currently in the control of fund managers  or investment banks who are responsible for the allocation of funds currently worth over £1 trillion with no democratic accountability.
  5. 23.  Measures to assist and protect from eviction those households trapped by debts or with mortgages they are unable to repay

Other Forms of Public Ownership and Cooperatives

Left Unity also proposes

  1. 24.   The return to  public ownership of all the essential public utilities (with the same rule for compensation as for the banks) , such as electricity, gas, rail and bus transport, and water, which were privatised over the last 30 years. The private companies have raised prices faster than inflation, made huge profits and still neglected investment in essential infrastructure.
  2. 25.  We also propose the public ownership of other essential services, including the  giant supermarket companies, which dominate the retail trade and much of the agricultural and food industry in this country.

We recognise, however, that state ownership alone does not suffice.

  1. 26.   New forms of governance are necessary involving democratic elections of both worker and community representatives. That also applies to existing public services such as the NHS and Educational institutions.
  2. 27.  There should be a cap on the highest rates  of pay for managers across the public sector, set no higher than three times the average wage in the sector.
  3. 28.  It is also essential to  support and extend existing forms of cooperative and mutual ownership, whilst preventing the violation of those principles evident in the mismanagement of the Cooperative bank. We will oppose and campaign against the de-mutualisation of existing building societies and other cooperatives. We would  ensure that financial institutions under public ownership gave priority to lending to worker, consumer and housing cooperatives, as part of the broader strategic priorities outlined above under employment policy.

Taxation policy

When the Coalition came to power, it made it clear that the reducing Britain’s budget deficit would be primarily achieved through public spending cuts rather than tax increases. The result has been the most vulnerable sections of society pushed ever deeper into poverty. What tax rises we have seen such as VAT have largely been regressive measures, hitting poorest households hardest. Meanwhile, the government has given away billions to the richest individuals and biggest corporations through tax cuts, while failing to stop billions more being siphoned off to tax havens. Richard Murphy of Tax Research estimates the tax gap at £123 billion a year.

  1. 29.  We need tax policies to offset the cost of reversing the spending cuts in the immediate term, while in the longer-term realigning the British tax system into a progressive framework that substantially reduces inequality, protects the poor and ensures the rich pay a much higher share.

Left Unity will therefore:

30. Work to stamp out tax evasion and avoidance, drawing on the wealth of research by the Tax Justice Network. A Left Unity government would implement unilateral measures at home to shore up its domestic tax base, including a general anti-avoidance principle, strengthening HMRC, creating strong barriers to protect tax policy making and adminstration from political and corporate interference, controlled foreign company reform and aligning capital gains tax with income tax. It will work with governments around the world to promote financial transparency and prevent tax avoidance by pushing for country-by-country reporting, unitary taxation and automatic information exchange. It will crack down on the UK’s network of tax haven Crown Dependencies and Overseas Territories which lie at the heart of the global tax avoidance industry.

31. Immediately cut VAT to the EU minimum of 15% (and abolish it for basic necessities) and remove the VAT exemption for financial services. Our long-term goal is to abolish VAT entirely.

32.  Reverse the corporate tax cuts, raising rates back to 40% for large companies, while reducing taxes for small businesses to compensate them for the mandatory living wage. As a matter of principle, Left Unity subscribes to international tax cooperation and building a framework of rules and conventions to inhibit tax wars and beggar-my-neighbour tax policies. We will work with other governments to push for higher corporate taxation rates globally.

33. Bring back the 50% tax rate and apply it to people earning over £75,000. We would introduce an 80% for all earnings 10 times above the median wage. We will work to lift all those earning below £20,000 a year out of tax entirely.

34. Introduce an inheritance tax  rising to 90% on all wealth and assets 100 times  the median average level, along with a wealth tax of 10% on wealth more than 10 times the median.

35.  Investigate alternatives to council tax including a mansion tax for homes over £2 million and a local income tax, and introduce a land value tax collected centrally and redistributed to local authorities according to need.

On Trade and the European Union

36. Given that over 50% of Britain’s trade is with the rest of the EU we do not propose a withdrawal from the Single Market, or  ‘protectionism’ against imports,  whilst recognising that some of what we propose (such as capital controls) will be in breach of Single Market rules on the  free movement of capital.

37. We are opposed to Britain joining the single currency as currently constituted with an unaccountable European Central Bank which has helped impose austerity measures on countries such as Greece, Ireland and Portugal.

38. We also oppose the provisions of the proposed Transatlantic Trade and Investment Partnership between the EU and the USA which threaten to impose further privatisation of public services and weaker forms of environmental regulation.

39. We are for joining with others across Europe to campaign for a different form of European Union, a ‘socialist reconstruction’, as called for by the 4th Congress of the European Left Party.

For Further Debate: There are a number of proposals for a different type of economy based on democratic and socialist principles which we believe deserve further debate in the wider movement. However:

40. The  Economic Policy Commission considers that under capitalism (but not necessarily in a fully socialist society) the various competing versions of a Citizen’s Income will in practice promote the neo-liberal agenda of reducing the welfare state and leave the most disadvantaged people in society worse off. Our alternative is to promote full employment as outlined in the document and the principle of from each according to their ability, to each according to their needs.


19 comments

19 responses to “Economics Policy Commission draft”

  1. John Penney says:

    As a member of the economic Policy Commisson I support this draft of our proposed outline Economic policy statement. Of course Left Unity will eventually require a much more comprehensive, joined up Economic Development/Regeneration Plan ,running into more like 20,000 words to adequately cover the broad area of interconnected policy areas “economic policy” covers. The statements and proposals in this draft does however serve to differentiate Left Unity from both the “its total revolution and the overthrow of capitalism – or nothing” ultraleft position , and its neoliberal New Labourite opposite of “we’d really, really, like to support working class interests but we actually have to follow the dictates of the capitalist market and therefore continuing Austerity and the interests of the super-rich remains the priority”.

    Unfortunately there are two (I think quite unnecessary) mentions in the supporting explanatory text of the currently vogueish proposal doing the rounds of the “ trendy middle class left” – (mainly the Green and anarchist “left”) , for a “Universal Citizen’s Income”. I certainly wouldn’t support any economic policy statement that’s included this toxic escapee from the American ” Libertarian capitalist “ Far Right’s long promoted “policy bundle” . The newish pseudo Left version has significant differences to the original Libertarian Right’s version of course. In the original US Libertarian Free Enterprise Right’s version all Welfare/social support would be abolished, and its funds would be handed out equally to each citizen each year – to do with as they may. The individualist ideology of “Personal responsibility” and “consumer choice” of course concealing the reality that for the poor a small annual “citizen’s Income” handout still wouldn’t pay the big medical bills, or provide long term unemployment support – and the 1% of superrich are still left owning and control the overwhelming proportion of the means of producton, distribution and exchange – including the medical services of course. .

    The current “leftish” version of Citizen’s Income isn’t so radically anti state of course, or so clearly a device to cut the rich’s tax bills, , and doesn’t support the abolition of all Welfare provision to pay for the undifferentiated citizen handouts. But at root the concept is still fundamentally reactionary , seeing the “citizen” as an unfifferentiated individualised consumer, not a part of different social classes with radically different interests. It is bereft of a socialist strategy to build working class power through political and workplace and community mass struggle so as to transform the current grossly unequal distribution of productive wealth and political/social power deriving from capitalism.

    It has quite rightly long been a socialist aim that we seek to achieve a society in which it is possible to achieve the principles of “From each according to their ability – To each according to their needs”. The British Welfare State , in principle, though obviously not always in practice – and now under vicious assault from the Coalition and New Labour, is recognised by most British working people, often not consciously socialist at all, as a fair and decent way to run a society . Which is why Left Unity only needs to support the defence and deepening of the Welfare State, in our adopted key policy objectives, to gain widespread support from masses of working people. In contrast the demand for the gimmicky “universal Citizen’s Income” would be a complete distraction from the struggle to defend and improve our much loved, and well understood, British Welfare State . Most tax-paying working people would be in particular horrified by the core feature of the “universal Citizen’s Income” that from everyone’s taxes an equal adequate income be provided to every “citizen”- independent of different levels of personal need , so that even if perfectly able to work and contribute to the wider society, they can simply choose never to work at all. This would go down like a lead balloon with the wider public – and would be a complete gift to the Tory mass media – as a “ workshy leadswinger’s Charter” .

    Of course such a policy is not only electorally toxic, but is economically and socially complete nonsense too – and would inevitably lead to the withdrawal of masses of perfectly work-capable Citizen’s Income handout accessing “citizen’s” from all those nasty low paid jobs that nevertheless have to be done in any society . And who would do these jobs ? Saintly volunteers ? Nope. The few societies which have supported a passive layer of subsidised citizens with undifferentiated handouts , eg, oil states like Libya under Gaddafi , and Kuwait, show what happens. A large layer of super-exploited non –citizens are recruited to do these jobs instead – leaving the subsidised “citizen” non-workers as a pool of reactionary supporters of the status quo, (This of course was also the nature of the “free” Plebian “bread and Circuses “underclass in the Slave society of ancient Rome).

    As radical Socialists we should be helping to rebuild the trades union capability to use mass action and collective bargaining methods to secure a bigger share of the national cake. We should be aiming as a future Left Unity Government to repeal all anti trades union legislation, to institute a “living wage” minimum wage , and to tax the rich and corporations “until the pips squeak” to pay for a fully supportive Welfare state, as part of a dynamically productive economy with the Commanding Heights within democratic public ownership. We don’t need dodgy new projects like the “Universal Citizen’s Income” proposal. We can leave ideas like that, saturated in the ideology of “consumerist individualism” to the likes of the largely middle class pseudo Left, but in practice Austerity implementing, Green Party. Let’s steer well clear of the toxic gimmickry of the “Citizen’s Universal Income” proposal – and build Left Unity on well understood radical socialist policies that have immediate appeal to millions of working people..

    • John Tummon says:

      John, you are being economical with the truth in pointing to the failure to put together a comprehensive Economic Policy that integrates trade union rights and powers, consumer rights and powers, organisational governance across all sectors, training and professional/skills development, regulations around production (from ending planned obsolescence & emotion-based advertising to decision-making on what is to be produced and in what quantities), the measurement of economic indicators, distribution, etc, to mention just a few. I would like to see a comprehensive framework devised first and then each constituent policy area addressed in turn. We could all then see the direction in which LU policy development was travelling. Instead, the working method seems to have been to try to integrate thr work of a few disparate Left Think Tanks like NEF & Tax Research.

      I disagree with Nick Wrack’s Facebook comment that “is essentially a utopian, limp Keynesian plan to manage capitalism” and puts forward no alternative to a socialism in one country which it explicitly rejects, because Nick is just using empty rhetoric.

      But there is a distinct lack of a non-governmental dynamic in the document: something which empowers working class people and organisations as makers of history. WIthout this, it could be seen as socialsim from above.

      Finally there are some pretty unambitious reforms, like the reduction of VAT to 15% and opposing any further de-mutualisation of existing building societies without re-mutualising the whole sector.

      • John Penney says:

        I’m not actually unsympathetic to your critique of aspects of our current LU “Policy Development” methodology, John. Despite being a member of the LU Economy Policy Commission – and supporting its third draft policy document – I actually wrote earlier a 6,000 word, 10 page comprehensive “Radical Economic Regeneration Strategy for Britain in the 21st Century” document myself. It can still be viewed on www,johnleftie.wordpress.com . This is a much more all encompassing, and more radical, strategy document , which embraces in a holistic way a range of the policy areas which at present are separate in our policy discussions. Anyway, I posted this up on the , now discontinued “policy discussion forum” site, and sought supporters for it from our LU membership. Number of supporters willing to sponsor it , or even positive feedback ? Nil.

        Eventually I’m sure Left Unity will develop a more comprehensive policy “bundle” – but at present we are developing policy in a more piecemeal way – and that does draw upon policies already developed by various Left “thinktanks” and campaigns . I think it just has to be accepted that policy development in a politically quite broad, democratic movement like ours will be a fairly slow and iteratively developmental process – no doubt with a few missteps along the way.

  2. M. Jones says:

    Comrades

    This is pretty feeble and insipid stuff – no workers control, no expropriation, no democratic planning, no removal of large chunks of finance capital, particularly the most parasitic bits like hedge funds and “investment” banks? The capitalist class is not interested in “reforms” which don’t involve the reduction of workers’ living standards, it’s time to remove it from the stage!

    • John Penney says:

      For information : the latest version of the Policy commission’s Economy Policy statement (Draft 3 as it is now) supercedes the document currently on display here. It was agreed at a very successful all-day Economy Policy workshop in London on March 1st. This updated document has now been sent out to LU branches, and is the version which will be the one put before Conference on 29th March. I think it is many ways far superior to the first draft available here at present.

      And no, comrade M. Jones, even the new draft does not contain any “maximalist” revolutionary policies or demands. Why ? Because we are not in a pre revolutionary situation in Britain . We, on the Left, are actually currently struggling to build any significant level of working class resistance to the ever accelerating Austerity Offensive of the capitalist system, here in the UK and globally. We, the working class, and the left and Trades Union Movement are in full retreat, ideologically and organisationally. This is not the time to issue posturing “maximalist” revolutionary demands, like “expropriate the capitalist 1%” or “General strike now” – because these inappropriate demands would be viewed with bemusement and ridicule by the very working class people we are aiming to influence. We need to build a mass movement of active resistance around much more “bread and butter” – believable demands – “Defend the NHS”, “Tax the Rich and corporations”, “defend the benefits system”, reverse the privatisation of public services and assets, etc, etc.

      These are indeed in normal times of capitalist stability just radical “reformist “demands. Today, in the midst of worldwide capitalist systemic crisis they, and our full agenda of demands, would meet with sustained capitalist resistance – hence raising the tempo and political depth of struggle immeasurably as masses of people are drawn into struggle to achieve these demands. Our demands , sneered at by the tactically inept ultraleft, as “”neo-Keynsian reformism … etc. etc..” are in fact “Transitional demands” – building a policy and action “bridge” between the actual low level of class consciousness and combativity of the mass of working people today, and the longer term objective of confronting and challenging capitalism as a system.

      The ultraleft can sit forever in its tiny lifestyle bubble shouting “revolutionary” slogans at an uninterested working class. The majority of Left Unity, including many dedicated revolutionary socialists, are instead trying to build a mass socialist party which can break out from our collective isolated tiny Far Left Bubble – into the mainstream working class – and build a real radical Left Socialist mass party able to take on the capitalist offensive for real, not just in empty rhetoric.

      • M. Jones says:

        Comrade

        You have a serious problem here – being a reformist depends on the capitalist class which runs society being open to making the reforms you want. Given the crisis of capitalism and the weakness of the working class and the left the ruling class is only interested in “reforms” which allow it to seize ever more surplus value from the working class to the point where workers’ living standards are being reduced year on year across most of the world. Your position here is effectively to say to the ruling class they can remain in power and run society but you you want these improvements to workers’ lives which will cost them a chunk of the surplus they are planning to extract from us in future. We can state with certainty that the answer from the ruling class to this proposal will be NO. This leaves two alternatives: either you carry on the effective logic of your position as a reformist and become an agent of the ruling class imposing austerity on the working class (the position of about 100% of the world’s reformist political organisations at this point) or you decide that what is necessary for the liberation of humanity is the overthrow of capitalism and the ending of class based society. With the savagery of the crisis and of the ruling class and its agents the choice is fairly absolute.

  3. No-one on the left is proposing the ‘citizen income’ fantasised by John Penney. What is being put forward is an unconditional basic income (UBI) – look it up. Some points on Penney’s farrago of nonsense:
    – the welfare state is not ‘well-loved’ by the British working class. The NHS is; no-one loves the rest for good reason. Like the old Poor Laws, welfare provision has always been a means of enforcing class discipline something that has never been more clear than now. It is, and always has been, a bureaucratic nightmare reluctantly accepted, not a liberating force. The only bits of welfare that people actually like are the simple universal benefits – child benefit, retirement pension, DLA to some extent. That is why the Tories assault on welfare has been so successful
    – Left Unity absolutely should not be for defending and deepening existing welfare provision. In particular we must adamantly oppose the principles that are currently being used to impose unprecedented levels of penury and hunger on swathes of workers – conditionality and means testing. Opposing conditionality means opposing sanctions. John Penney apparently supports these murderous bureaucratic punishments because they deal with “workshy leadswingers”. Penney puts these words in quotes but nonetheless relies on their logic – quite appalling in a socialist discussion. Opposing means testing means supporting the financial independence of each individual – a principle recognised for middle and ruling class people by independent taxation but denied to working class women who are still being punished daily – frequently imprisoned – for choosing to have a boy or girl friend. This is done by the capitalist welfare state which John Penney wishes to defend. Tell that to the women in Styal for alleged cohabitation. Tell that to the young people forced to starve or beg for being considered workshy;
    – UBI meets these points head on by insisting on a basic right to live and eat for everyone, never mind whether they are judged deserving by the new, socialist poor law as advocated by Penney. We should add to these right equally unconditional rights to health care and housing, expanding the preserve of free goods alongside UBI;
    – Penney eulogises traditional trades union actions to increase wages weithout appearing to recognise at all that the basis for these has been sapped away by neo-liberalism, in particular, the spread of in work welfare and the minimum wage which signalled much greater state involvement. There is no longer a straight fight between labour and capital but one heavily mediated by the state, in particular by state welfare provision. Far from being “bereft of a socialist policy to enhance working class power” UBI is a decisive response to this development. It strengthens workers hands in every battle with employers by guaranteeing a basic income regardless. It redistributes wealth effectively, coupled with appropriate taxation policies and empowers the whole working class – especially the most oppressed sections like women, guaranteed an independent income for the first time, and disabled people, freed from some of the grotesque pressures to perform in the service of capital imposed by the likes of ATOS. It creates a shift in the balance of class forces, even while it isn’t socialism;
    – Penney’s rant consistently uses the most reactionary possible language culled from the scum press and the Tax Payers Alliance – “tax-paying working people” (everyone pays taxes – ever heard of VAT?) – “workshy scroungers”, “handouts”: appropriate given his fundamentally reactionary and nostalgic argument. (I pass over “trendy middle class pseudo left gimmickry” as not worth a reply).
    – underlying all this is a failure to understand, or even think about, the changing nature of ‘work’. For Penney work is something people must be forced to do, not ‘life’s first need’ as Marx put it. Witness his irrelevant reference to supposed cases of subsidised idleness from ancient Rome to the Gulf states. He believes that, absent state compulsion, we would all spontaneously lapse into a drone-like state, supported by others. This is an account of human nature derived from the saws and wisdom of the Daily Mail. UBI is based on an alternative view and other values. It is based on a belief that people should not be forced by the state to perform meaningless, useless work (most work under capitalism)by the threat of penury.
    – finally Penney believes that UBI cannot be an election winner. Leaving aside the nature of that criterion, which would block an awful lot of LU’s policies if generally applied, UBI builds upon the popular and useful parts of the welfare state (the universal parts); it eliminates benefit ‘fraud’; it creates vast economies in administration; and it ‘makes work pay’ far better than any system of means testing. Not an impossible argument – unless your main concern is – like John Penney it seems – to penalise workshy scroungers

    • John Penney says:

      Your peroration wilfully ignores the actual behaviour of real people in a capitalist society, Richard. But then the entire concept of Citizen’s Income (or Unconditional Basic Income , UBI ) , in both its various Right and Left versions has always combined huge amounts of wishful thinking with a comprehensive naivete about individual behaviour, the dynamics of the capitalist market place, and the actual profoundly unequal class nature of capitalist society. Citizens Income (or UBI) in its “leftish” versions simply represents a defeatist ideological and policy accommodation by sections of the middle class “left” to the hegemony of neoliberal ideology and unchallenged capitalist power and corresponding working class retreat over the last 30 years. It actually rejects the traditional socialist methodologies of class struggle as a means of improving the conditions of the majority, in favour of a naïve individual consumerist “empowerment via state handouts” strategy.

      For good reason the entire concept of a “universal citizen’s Income (or UBI) ” originates on the wilder fringes of the US “Anarcho Libertarian free Enterprise Far Right”. Far from “empowering” the poorest in society, it
      gives them a “basic living ration”(usually sourced from the funds derived from a complete destruction of any existing state welfare structure) and then leaves them to fend for themselves in the cold competitive mechanisms of the capitalist market place – irrespective of their individual needs, or differing abilities, or wealth ownership.

      Socialists believe in the principle of “From each according to their ability – To each according to their needs. Unlike the underlying individualist consumerist assumptions behind the various CI proposals , we as Socialists don’t see people in society as simply “individual consumers confronting the capitalist market place” – but as members of distinct social classes – in a society where the tiny 1% capitalist class owns all the means of production, circulation and exchange. We look to collective class action by our majority class to improve the income levels and living conditions of our class – and in the long term aim to take collective ownership of the means of production by expropriating the capitalist class and abolishing their capitalist system.

      The underlying ignoring of the class basis and totally unequal power and wealth distribution in capitalist society, and the red herring diversion from the realities of the need for class struggle on a collective mass basis to improve the lot of working people, which the demand for a ” CI state handout” irrespective of personal wealth or individual need to each “citizen” represents, is the reason why the concept is so popular with capitalist parties like the Lib Dems, sections of “Blue Labour” and the middle class individualists of the Green Party. The various “lefter” versions of CI are still saturated with its original individualist neoliberal ideology, despite the various added “progressive” additions , and redistributory and empowering claims made by its “left” advocates.

      As a radical, transformational, socialist party, Left Unity needs to promote itself as the party which will restore full employment to Britain through an integrated National Plan, empower and rebuild the trades union movement by abolishing all the anti trades union legislation of the last 30 years, tax the superrich till the pips squeak, introduce well-policed minimum “living wage” legislation, nationalise the commanding heights of the economy, rebuild the Welfare State .

      We are not about accepting the permanence of mass unemployment – or indeed accepting that able bodied citizens have any “right” to refuse to participate in the collective work effort required to make society function. In return for al the privileges of citizenship, everybody who can work, should work. That is a very basic, deeply traditional working class and socialist principle. We are not middle class Hippies – who think long term abstention from work is any more acceptable from our able bodied working class brethren than from the “idle rich”. The mass of our target working class audience would find the incentive provided by CI for perfectly work-capable people to retreat into a passive life of idleness deeply offensive. As an economist I also find the claim that CI (or UBI) wouldn’t produce a hugely increased new passive non-working CI-receiving “citizen” population – replaced by a super-exploited “non-citizen” migrant worker sub-class , simply based on a willingness to ignore abundant historical evidence across innumerable societies.

      The “Left-wing” versions of “Citizen’s Income” (or UBI) is a reactionary, diversionary, political proposition, completely alien to the socialist tradition – a modified “crossover” concept from extreme Far Right neoliberalism, which still retains all the underlying toxic ideological content from its original parentage. Left Unity should have nothing whatsoever to do with such a concept which would be both electorally toxic with our target working class audience, and is actually economic nonsense in terms of any of the “progressive” objectives it claims to deliver for the working class and most vulnerable in society.

    • John Penney says:

      Time constraints earlier meant I didn’t take have time to take up a core “straw man” argument Richard Atkinson puts up in favour of Citizen’s Income/UBI – namely that every “citizen” getting an equal state handout each year would free everyone permanently from the scourge of benefits means testing. This of course is utterly untrue. Every citizen gets an equal state handout under CI/UBI – which may , or may not, provide the very basic living income required for a “typical person”. However if a family or parent has a series of exceptional needs because of a disability they or their children have – major additional support will be required. This additional support will of course have to be assessed , yep, by agents of the state – before support can be delivered. That’s just the reality of how exceptional needs can be met from public funding. The idea that “means testing” is abolished by a Citizen’s Income set up is a complete canard. Except of course in the hard line neoliberal variant of CI – in which no additional support is available at all – beyond the fixed “ration” of income given out regardless of individual need . It is also a spectacularly cynical “straw man” argument to suggest that a Welfare State under a socialist Left Unity Government would allow the carrying out of perfectly reasonable needs assessments for Welfare benefit support in any way similar to the deliberately draconian and vicious methodologies carried out under capitalist governments – particularly all the ATOS brutality of recent years. In reality of course it is socialists like myself who would put no limits at all on the support provided to individuals or families with exceptional needs. To assess and meet this need though some process of needs assessment would be required. It is the CI/UBI proposals in their myriad forms that actually would leave huge numbers of people with major special needs completely unprovided for beyond that small fixed Citizen’s Income handout. which is why the concept is so attractive to neoliberals everywhere as a way to cut the Welfare budget, whilst hiding behind the mantras of “person responsibility” and “everyone being freed to make their own spending choices”.

      Many LU members may not be aware that in a previous guise a very similar iteration of many of the key features of the current Citizen’s Income/Universal Basic Income proposals was hawked around the Labour Movement – in the 1930’s. That time around it was called “Social Credit”, the brainchild of non-socialist British social theorist called Douglas- and it had many of the same features – particularly handing out fixed equal amounts of income to each citizen. It was roundly rejected that time around by the Labour Movement – as an eccentric economically incoherent set of proposals, (with a very unsavoury anti-Semitic and fascistic totalitarian social model core), as a diversion from the need to build a mass socialist movement through class conscious mass working class struggle – to replace capitalism with socialism. Today’s Citizen’s Income or Universal Basic Income proposals are different in detail from the old eccentric “social Credit” nostrums, but at root they are the same old economically incoherent, reactionary, individualistic, ideas, given a new lick of ideological paint. We need to show these new CI/UBI proposals the exit door as decisively as our Labour Movement forebears did “Social Credit” in the 1930’s.

  4. Nick Wrack says:

    Can someone explain how the Commission can amend its own document after the deadline for submission to the conference? And could the authors of the document please put their names to it?

  5. John Penney says:

    I think the logistics of getting the March 1st economy Policy workshop together led to a very, very, slight time overrun on the submission of the final Draft , Nick, but only by a few days. Surely this isn’t a big issue ? The improved content (in my opinion) – and the outright rejection of Citizen’s Income as a potential policy for LU, justifies the slight overrun. Still a non-revolutionary policy bundle though – and given that LU isn’t a revolutionary party – why would it be ?

    I’m sure the attendees at the March 1st Working Party and the two Convenors of the Economy Policy Commission won’t object to appending their names to the document for Conference. Seems fair enough a request .

  6. Guy H says:

    Now updated to amended draft.
    Nick – amendments can be made up to 14 March.
    The authors were the LU Economics policy commission convened by Pete Green and Salman Shaheen.

  7. Nick Wrack says:

    Guy, surely that can’t be right. Normally resolutions or documents are submitted by a deadline. They go out to the branches/membership for consideration and amendment. The amendment deadline in this case is 14 March. The original resolutions and documents and the amendments submitted in time then all go to the conference for a decision by those at the conference. What appears to have happened here is that the Economics Commission has amended its own document without it having been discussed by the conference. I’ve never come across this before. Have I got this wrong?

    • Pete Green says:

      In response to Nick Wrack: this issue was taken to the last TNC by myself and discussed as part of the broader discussion about policy commissions and Manchester. the full discussion was not of course recorded in the minutes but my original motion had been circulated, and was passed overwhelming. This contained a reference to the difficulty which has since been raised by yourself, and Simon Hardy.
      It had originally been the intention to produce a draft for a workshop (open to all members and advertised on this site as such)to be held earlier in February. For various reasons ( problems with room booking, clashes with other engagements involving active members of the commission etc.) the workshop had to be postponed until March 1 – later than the deadline already agreed for submission of policy proposals for Manchester. That left us with two options and I personally was open to debate on the question. One option was to leave the Economic Policy document until the second policy conference in June. Unfortunately and with other commissions also seeking postponement until June this would have resulted in the June conference being overloaded – and other officers were unhappy with that option. The second option as agreed by the TNC was to proceed as we did – to circulate a first draft to branches in advance of the workshop and then to have the collective discussion at the workshop which proved very constructive. The result is a much better document as several of our critics seem to agree and a testimony to the value of an extensive workshop session involving around 18 members of the commission (but unfortunately only one person who was critical of the document from the perspective previously enunciated by Nick himself – we would have welcomed others, including yourself, I can assure you.
      I then rewrote the draft circulated it to all those who had been present at the workshop, and then made further corrections – all within the space of three days to ensure that the revised draft could be sent out to branches and posted on the site as soon as possible.
      A generous critic would show some appreciation of the work that went into this process even if they still disagreed with the outcome. As it is you have the option to move a reference back of the whole document on formal procedural grounds. What could be more open and democratic?

      • Nick Wrack says:

        Pete Greeen’s reply to my question appears to acknowledge that the rules have been bent to accommodate the Economics Commission getting its final submission in late, after the deadline. I have no doubt that a lot of time and effort went into drafting the documents. I agree that the revised document is an improvement on the first draft, although it is still fundamentally flawed. That is not the point, however. If the document was out of time – and it was – then in should be rule out of order by the Standing Orders Committee. Or are rules only there for the members and branches and not for the self-selecting members of the Commissions?

  8. Pete Green says:

    In response to Nick Wrack: if the Standing Order Committee votes to rule the Economics Policy document, as revised, out of order for Manchester, and the conference endorses that position, then fine we can debate it at the London conference. We were certainly not looking for any special consideration. All we were doing was trying to maximise the engagement of interested members in a process which involved intensive political debate and resulted in a greatly improved document in the opinion of many who’ve read it.
    In any event the commission convenors will be prepared for a debate depending on any democratic vote on whether we proceed at Manchester or not.
    What’s extremely objectionable about this comment is the insinuation in the final sentence. Nick was originally on the working party for policy commissions which was set up ( admittedly in a rather hasty fashion) at the Doncaster meeting of the provisional National Council (or whatever it was called) back in May 2013. I along with other volunteers played an active role in that working party. Nick resigned after a few weeks on the grounds that he was too busy. Then he complains about ‘self-selecting’ members. Salman and myself then went to the Manchester policy forum in September ( a forum which Nick and many others who supported his platform didn’t even bother to attend perhaps because they were too busy organising their faction). There we presented our outline of how to proceed and offered to resign if those present were unhappy with our role. It would appear sadly that Nick only wants to be involved in these discussions and workshops if he himself is setting the agenda. There’s been too much of that attitude in recent years on the left, not least in Respect as I recall. We desperately need to move on from this style of debate replete with insinuations and denunciations which serve as a substitute for addressing the appalling state of the left in Britain today and what we can do to address that.

  9. Jacob Richter says:

    On the subject of “fair trade” and international trade in general, this draft comes woefully short.

    I believe there should be consideration for requiring all developed countries to import anything from developing countries at above-market prices, and for all developing countries themselves to be allowed to import anything from developed countries at below-market prices.

  10. Steved says:

    Not a lot of unity on this discussion. Fighting like cats in a bag while the reactionary right run off with all the protest votes.

    A shocking disgrace. I’d try and bang your heads together, but know there is no point. So few lessons learned from past failings. Too much one-up ship with fetishised rhetoric.

    Get a solid left platform, stop quibbling. Get behind it and stop imagining yourselves on some cobwebbed committee circa 1965.

    Just my opinion. Believe it or not, I wish LU the best of luck if they can actually be united.

  11. Jacqueline Anderson says:

    When will the left address the main issue, the constant priority of the ‘economy’ over the welfare of people and the planet. I would like to see a clear statement of the parties commitment to society, people and the planet over the needs of the so called economy, which is short hand for capital owners amassing more power and capital. There is a lot of worthy objectives here but an overarching policy direction is needed. Such as overcoming inequality and encouraging the optimum health and full potential of land, communities and individuals.


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