Left Unity needs to Create an integrated National Economic Development Plan

941278_10151630019603523_1653256551_nJohn Penney form Crewe Left Unity explores the need to develop a coherent National Economic Development Plan.
Large scale national economic planning was a key feature of  European social democratic party manifestos, and political practice when in office, for much of the post WWII period. The first  Harold Wilson Labour government of 1964 to 1970 for instance , although profoundly wedded to the capitalist status quo,  tried to pursue an ambitious national planning agenda.  As the Wikipedia entry recalls :  “ A main theme of Wilson’s economic approach was to place enhanced emphasis on “indicative economic planning“. He created a new Department of Economic Affairs to generate ambitious targets that were in themselves supposed to help stimulate investment and growth (the government also created a Ministry of Technology (shortened to Mintech) to support the modernisation of industry). The DEA itself was in part intended to serve as an expansionary counter-weight to what Labour saw as the conservative influence of the Treasury…………… In any case the government’s decision over its first three years to defend sterling’s parity with traditional deflationary measures ran counter to hopes for an expansionist push for growth. Though now out of fashion, the faith in indicative planning as a pathway to growth,[15] embodied in the DEA and Mintech, was at the time by no means confined to the Labour Party – Wilson built on foundations that had been laid by his Conservative predecessors, in the shape, for example, of the National Economic Development Council (known as “Neddy”) and its regional counterparts (the “little Neddies”).[13] Government intervention in industry was greatly enhanced, with the National Economic Development Office greatly strengthened, with the number of “little Neddies” was increased, from eight in 1964 to twenty-one in 1970. The government’s policy of selective economic intervention was later characterised by the establishment of a new super-ministry of technology, under Tony Benn.[16]

Good as these ideas were –  regular economic crisis, and the fundamentally unwillingness of the Labourites to  do more than simply try to “bring order to domestic capitalism” rather than any more radical agenda, meant that  very little was actually achieved.   By the second Wilson government of 1974, “stagflation” and the Labour Government’s  main aim of  demobilising the then radically rising tide of working class struggle built up during the battles against the Heath Government, meant that Labour were more interested in  promoting class collaborationist ideological “we’re all in it together” con tricks like the bogus “Social Contract” , than trying to reshape the British economy to benefit the majority of citizens. And of course the neoliberal Blair/Brown governments were entirely “ideologically captured” by the toxic theory that all that capitalism needed was  to be “freed from the shackles” of  regulation and state direction, and it would  (eventually) create prosperity for all – through the crumbs falling on most of us from the ever increasing riches  on the superrich class’s  table. Well , since the 2008 world economic Crash , and now the endless Great Recession, we can see the real outcome of the lack of regulation, the lack of planning for public benefit, on the UK and the world’s economy – a class of superrich  gorged on a transfer of wealth and incomer unprecedented since Victorian times – and the rest of us increasingly impoverished.

From comments   on our own LU website it is obvious that the 30 year neoliberal ideological offensive , in favour of unregulated (and of course untaxed,)  free enterprise capitalism has bitten deeply into even the ideological “mindscape” of people who see themselves as “radicals”  !  So much so that the term “National Planning”, is too often seen as suggesting the establishment of the  structures  and practices of Stalin era Soviet “Five Year Plans”, rather than as a normal part of radical  social democratic practice and philosophy.  That some of the most successful examples of large scale integrated economic planning actually derive from reforming administrations in capitalist states, eg, The  Roosevelt  New Deal  Programme in the USA in the 1930’s , is not something the capitalist media wants us to remember. Even reformist programmes of large scale planning in capitalist states put far too much restriction on the greed-driven dynamics of capitalism for the capitalist class’s  liking.

 

What should a radical Left Party’s Economic Development “proposal” to the electorate look  like ? Simply assembling a bundle of  disconnected “desirable economic aims” and  outline policies is all very well, but credible Economic policy cannot just be a  “car boot sale” of pick’n’mix  ideas and policies which meet various criteria for being generally desirable from a “Leftish” perspective. . That’s  the  type of mish mash of economic policies piled up in the Green Party’s  portfolio – something for everyone – but no coherent masterplan , and no credible deliverability (and no intention to do so in the case of all the “anti capitalist “rhetoric ) .   If Left Unity is to have any credibility with its various “offers” to the target voters in the UK , ( mainly ex or existing Labour voters – and the  large working class contingent who seldom vote – because no-one seems to be interested in providing them with a good quality JOB). We have to outline in a few sentences our overall objectives in the economic field,  then  identify some key problems with the UK economy,, and then outline the bones of a coherent set of solutions.

To give an introductory example of the direction  think we should go:

Our overall economic objectives:

For Left Unity the entire purpose of  our  society ,and its economic activities, is to provide as prosperous, individually rewarding, healthy, and environmentally sustainable,  a life for the overwhelming majority  of the inhabitants of this island as is possible. We do not see the purpose of society in general, or its economic activity in particular, as simply to provide a profitable” platform” for big corporations and a tiny class of superrich. We reject the idea of our society being  comparable in any way to  “UK Plc”, as the  main three parties believe. For us all economic activity is there to serve the needs of people,  not  the blind pursuit of profit for a few.

Key  current problems with the current UK economy:

1. Outside the  monstrously oversized financial services sector  dominated London- centred economic  zone  of the relatively prosperous but overcrowded South East , the lack of a serious  UK  regional development strategy for 30 years , and the unlimited growth of the parasitic, destructive, financial sector at the expense of manufacturing industry ,has led to most of the UK being an increasingly  deindustrialised wasteland with few good quality job opportunities.

2. There is no joined up “national plan” to regenerate the failing regions, restructure the “economic sectoral mix” away from casino banking /financial speculation, to regionally spread, diversified ,manufacturing , particularly  high tech manufacturing .

3. We are spending far too little on the education and appropriate skilling of our population, particularly our young people – to ensure opportunities and well paid, rewarding jobs for all, in a dynamic economy with a full range of job opportunities nationwide.

4.The government coffers are increasingly being drained by the ever decreasing tax revenue from the  superrich and big corporations, as they take advantage of the tax loopholes deliberately created by compliant politicians and an Inland Revenue now run entirely by ex- tax avoidance experts, to reduce their tax payments to derisory levels.

5.We are squandering tax revenues needed to regenerate the UK and pay for our Welfare and Educational services,  on a Cold War era nuclear weapons capability which has no credible enemy, and tying down a huge skilled workforce in arms production, better devoted to socially useful products.

 

I could go on – but the key problems facing the economy and the majority of its citizens need to be identified ,  and then a series of radical measures proposed to transform the UK economy from a low wage, high unemployment, one, skewed to the interests of the London-based financial sector,  to a balanced economy with good jobs and good wages for the majority – not just a bunch of investment bankers.

Such Radical policies might include:

 

  1. To facilitate the implementation of an  economic recovery plan, on an integrated nationwide basis we will : Take back into public ownership/ stop the privatisation of,  all the key national resources and “natural monopolies”, eg, water, Gas, Oil, coal, Steel, rail, Post Office. End all outsourcing/privatisation of public services, eg, prisons, police, education, healthcare. And the BANKS – not only bring them firmly into full public ownership but to operate within the framework of  supporting with finance the implementation of a comprehensive National Economic Development Plan, aimed at building an economy to benefit the majority, not the few.

 

  1. In a national joined up regeneration effort we need  to  get the economy moving again, via a massive programme of job creating and productive public works, including building and refurbishing  millions of council houses, creating  an efficient national road/rail interchange freight network,  and major renewable energy infrastructure projects, from hydro electric, to tidal energy and wind power .

 

  1.  We need  a targeted long term massively funded national education/training  national plan to encourage the development of  the skills required by an economy focussed on high tech manufacturing, not short term financial spivery, and to ensure that every young person  is equipped  with the vocational skills and education to participate fruitfully in the world of work.

 

  1. Develop an integrated National energy plan , and a National Energy Corporation ,to exploit and develop Britain’s energy reserves, and create a sustainable energy supply infrastructure, including as many renewable sources as possible, to provide cheap energy to the domestic consumer and industry.

 

  1.   We  need  to   develop a major focus on developing   new industries within the emerging environmental  sector, and an emphasis in all industrial policy on environmental responsibility.

 

  1.  We need to totally overhaul the tax system, by  introducing  a radically income redistributive taxation system , and closing all possible tax loopholes , including avoidance schemes on high end Death Duties and closing down all UK controlled offshore tax havens ,to maximise the tax take from big corporations and the rich – to help fund  an enhanced  Welfare State’s services and the recreation  of the UK’s economic base.

 

  1. We will scrap the Trident nuclear  weapon system, and  cancel its successor  programmes. The UK will become a non-nuclear weapons state. The vast amount of  money saved , and the skilled jobs involved  ,  will be redirected to socially useful production .

 

  1.  Encourage the development of a massively expanded thriving SME manufacturing sector , based on private firms, co-operatives, community businesses, social enterprises,  to bring flexibility and dynamism to the  UK business environment. Worker participation in the operations of these and large firms to be legislated on  — drawing on, and extending beyond,  the postwar experience in Germany of worker/trades union  participation in business management.

 

and so on…

 

Airy statements of principles and nice objectives are all very well – but the UK economy is in a mess, millions of people need good quality jobs (not zero hour contracts and workfare). Left Unity’s take on the economy has to be radical but believable and hard headed, and above all holistic..

 

 


12 comments

12 responses to “Left Unity needs to Create an integrated National Economic Development Plan”

  1. pete green says:

    John if you’re serious about this plan becoming left unity policy please join the Economics policy commission and submit it there for further discussion.

    • John Penney says:

      Oh, I’m serious, but the reason I’ve put this on the main site is that for some technical reason I’ve been “firewall excluded” from the main site for a few days, and the Policy Commssions site at present– I don’t undrstand why ! But I can still send in articles by EMAIL ! I have had to drive out to be near a wifi hotspot from my rural location, to access the LU site from my laptop dongle Vodafone connecton today – avoiding the site’s current “Firewall” bockage of my home computer !

      I’ll post the article on the Policy Commission Economic Policy section now if I can – whilst I have connectivity. I don’t know if anyone else has run into this Firewall problem ?

  2. Baton Rouge says:

    John: It is traditional for parties to present manifestos and programmes not proscriptive plans. For socialists it has to be usable in elections and more importanty in day to day class struggle. A programme outlines the most urgent and immediate policies that can defend the working class and present a way for forward for the whole of society in the form of five or six key socialist policies one of which would include the need for a democratic plan. That plan however would need to be discussed by the entire class in the organs of power that it throws up in the course of its struggles for power. I urge you to put your support behind the Manifesto Group’s resolution and programme when it is presented and hopefully discussed in the branches, regionally and at specially called meetings for all members to attend that are interested before the November Conference where it will be passed in preference to the sectarian offerings of Socialist Platform and the `broad’ opportunism of the Left Party grouping.

    • John Penney says:

      The “Manifesto Platform” sounds very interesting, Baton Rouge !. I agree with your assessent of the other two named Platforms.I’m currently “Firewall ” exclude (by LU’s hosting platform)from accessing the LU site from my home computer, for an unknown reason,so keeping up with developments is tricky !

  3. Alex says:

    This is excellent.

    The integrated character of such a plan, which you emphasize, is something distinguishing planning from laissez faire – in which a jumble of this and that occurs, with no mutual coordination.

    But bear in mind that realistically, you would only actually be able to have an integrated plan with full access to fine-scale economic data, detailed modelling, and so forth; indeed you’d only really know whether things were interlocking harmoniously after the plan had been running, in reality, for a bit. Just because of the complexity of actual economic life.

    So a manifesto plan should come with the rider: “provisional aspiration”.

    • John Penney says:

      Absolutely Alex. Such an aspiration for a joined up Plan could only be indicative, and aspirational, prior to Left Unity being a serious political force – indeed being a government really – in its final form – because such a Plan would need to involve the widest possble “stakeholder” participation – particularly from the Labour Movement, and would also need bang up to date data – and major input from ideologically attuned academic economists.

      There is also the issue of “devolution” , in that such a Plan woul only work if devolved governments in Wales and Scotland “bought into” the process too. If Scotland goes “independent” then getting that island-wide “buy-in” would be more difficult – but still desireable.

  4. Nick Wright says:

    There is already a lively discussion in labour movement circles about the shape of an alternative economic strategy.
    See

    On industrial strategy Jonathan White wrote perceptively here:
    http://21centurymanifesto.wordpress.com/2013/04/30/whats-left-industrial-strategy-the-labour-movement-and-manufacturing-in-britain/

    and here
    http://21centurymanifesto.wordpress.com/2012/11/29/building-an-economy-for-the-people/

    The book Building an Economy for the People is obtainable from Manifesto Press
    http://www.manifestopress.org.uk/index.php?option=com_content&view=article&id=34:building-an-economy-for-the-people&catid=14:aeps&Itemid=2

    • Andrew Crystall says:

      Given the plan which Labour have committed themselves to is the same as the Tories, including blocking automatic stabilizers…

    • Alex says:

      Interesting. What sort of traction do you think these proposals (this general model of state-led/social industrial strategy) have in the Labour Party?

  5. Interesting that you are having this debate when there are other groups etc. that having been putting forward alternative economic policies. For example LEAP (Left Economic Advisory Panel) and Tax Justice. Rather than reinvent the wheel look at what these groups have been putting forward.

    http://leap-lrc.blogspot.co.uk/?m=1
    http://taxjustice.blogspot.co.uk/?m=1

    Also PCS trade union has put forward economic alternatives. Instead of creating some kind of economic manifesto in isolation wouldn’t it be preferable to first examine what’s already existing on the left?!

    • John Penney says:

      My article was about the basic principle of Left Unity adopting a radical National Economic Development Plan strategy, with an example of the possible content, NOT a suggestion that we should ignore all the good stuff already out there. If LU adopted such a key component for its Manifesto I would hope we would gather the best ideas from across the Labour Movement and combine these, with any new ideas required, into a basic Plan – in the context of wide consultation.

  6. mikems says:

    John,

    That’s a great contribution, thanks. I would just add need for capital controls for such an economy to work properly and that would present difficulties that we need to think through.

    Also a publicly owned banking infrastructure to build public capital and investment funds.

    Also – last one! – not just rail nationalised, but buses back under local public control. Expensive buses throttle economic activity for non car owners.


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