A smiling Gordon Brown pictured sitting in a helicopter gunship at the weekend may have been dreaming about new ways to persuade disillusioned voters to back him or simply how he was taking New Labour further down the road from welfare to warfare. For today, the government declared war on people scraping by on miserly state benefits.
Heavily-trailed proposals will compel the long-term unemployed to clean streets and pick up litter – not for a wage but just to go on claiming their benefits. Those who decline will be left without a penny. Naturally, the Tories are cock-a-hoop because they thought of these ideas first. So naturally they will vote with the government when these plans come before parliament.
Work and pensions secretary James Purnell said that his plans would "transform lives". He is right there, although perhaps he should have said “destroy lives”. And yet people still tell me that however bad this government is, the Tories would be worse! The only people they are fooling are themselves.
Actually, these proposals are no more than the modern version of the Poor Law and the workhouse introduced in 1834 by the newly-enfranchised capitalist class. Relief, as it was called in those days, was conditional on being in a workhouse. The only alternative was starvation, especially in rural areas.
The contrast with how the government treats global economic elites could not be greater. As Purnell was knocking the last nails into the coffin of the welfare state, news was emerging about how the government had caved into caved into business demands over foreign profits taxation. According to the Financial Times: “The concessions mark the latest in a string of climb downs by the chancellor, who has been forced to rewrite large sections of his Budget and pre-Budget report, including proposals on income tax, capital gains tax and fuel duty.”
Proposals to impose a worldwide tax on “passive” income, such as royalties from intellectual property, provoked a backlash from leading transnational corporations. Some decided to relocate their headquarters to Ireland for tax purposes. So this week the Treasury will announce that these anti-avoidance proposals have been axed. “Business felt the changes [to the anti-avoidance] rules were not acceptable or workable and we’re talking with them to resolve those concerns,” a Whitehall official said. So that’s alright then. Business has spoken and, as usual, has got its way. The weak, the poor and those on benefits have no clout and so they get clobbered.
Still the illusions in New Labour persist in some quarters, especially amongst the supine trade union leaders. In exchange for keeping the party afloat financially, this week they will present a shopping list of demands to Brown with the aim of getting him to change course and avoid electoral disaster. They simply don’t get it and never will. New Labour and Brown are not for changing. They are 100% committed to meeting the needs of global capital, insofar as they can, as the climb down on tax confirms.
As the economy goes into freefall, with unemployment climbing rapidly, the attacks on working people will intensify. We will have to defend our interests independently of the state and the weak-kneed union leaders. Our Stand Up for Your Rights festival and rally in October is a contribution towards building such a movement and you should register to join us there.