[page 8]
Poll tax - Thatcher's
terminal
CriSiS?
The poll tax has become a lightning conductor for the accumulated bitterness
at eleven years of
atcherism. Peter Taaffe
amines perspectives for
Britain.
Th ex
"As Trotskyists the world over scurry for cover, their British comrades are suddenly on the march in the vanguard of the working class revolution in such hitherto neglected proletarian outposts as Windsor and Maidenhead. Worcester and Norwich.... The only real gainer.... is Militant. It is a strange situation. But then as Trotsky observed in his Histort of the Russian Revolution. 'The revolution does not choose its paths: It made its first steps towards victory under the belly of a Cossack's horse! How wonderful it is — how richly: exquisitely comic - that Trotskyism has made its biggest advance of the 1990s in the conservative home counties. under the belly of an English police horse. outside the local town hall." (Robert Harris, Sunday Times. 11 March 1990).
The poll tax revolt has swept like a tidal wave through Britain. Inspired by the year long resistance in Scotland, demonstrations of hundreds and thousands have besieged town halls
throughout the land, culminating in the magnificent demonstrations, 200,000 strong in London and 50,000 in Glasgow, on March 31. The London demonstration was the biggest in Britain for a hundred years, and one of the largest in history. The violent clashes and rioting which took place at the end have done nothing to diminish its huge impact. (See Militant Vo. 987 for an analysis of the march and the causes of the violence).
Not just in the towns and cities but in the smallest village in the remotest rural areas the resistance has developed on an unprecedented scale. This is typified by Bishops Green in East Sussex where from a population of 280, 180 are not paying the poll tax. The sign outside the village reads. 'You are now entering a poll tax free zone. It is as if Thatcher has taken a giant spoon to stir up the whole of society. Hitherto firm supporters of the government have besieg. ed local Tory dignitaries. In Bexley former
[page 9]
8 Spr Poi
MIR ng 1
Tax
Former Tories now denounce
Thatcher as a
'traitor.
Tories "traitor.
Hesseltine has launched a barely concealed challenge for Thatcher's crown. Rifkind, Scottish Secretary, by threatening to resign, forced the government to do a complete about-turn and extend relief for poll tax payers in England and Wales to Scotland. Incredibly he subsequently stated "she (Mrs Thatcher) has fallen in line with my better judgement" (Observer. 25 March 1990). Such public 'insolence' in the past meant dismissal from the Cabinet for Biffen and others. Now a weakened Thatcher, desperately clinging to her premiership, is incapable of her previous 'firm leadership'.
This situation completely confirms the analysis which the Marxists alone made both of the consequences of the poll tax and perspectives for the Tory government. In summer 1988, for example, answering Thatcher's declaration that the poll tax was the 'flagship' of her third term, we explained that "with clear leadership the labour movement can sink the Tory flagship without trace. And when the flagship goes down, the Admiral either goes down with it or is sacked!" Militant, 29 July 1988.
Hegel was fond of stating that reason becomes unreason and unreason becomes reason. Those qualities, which a fawning capitalist press lauded so much in the past, have turned into their opposite. Thatcher, hailed as the Warrior Queen' able to face down foreign dictators and 'the enemy within', is now assailed on all sides as 'stubborn' and 'inflexible' Ritualistic support for the 'community charge' has now been completely abandoned by Thatcher's Tory opponents. John Biffen, writing in the Observer, states "the major political liablity of the community charge is that the flat rate concept is considered to be unjust. It offends a widespread belief that higher incomes merit higher taxes. Arguments showing that the community charge accounts for only a quarter of local spending and that the bulk comes from the general and progressive taxation are words in vain. It is a rich man's tax devised by a government dedicated to the elite of wealth... the prime minister, in a maladroit (this is Tor! code for idiotic - PT) political judgement. elevated this measure into 'the flagship of our legislation'." (25 March 1990).
Thatcher's second blunder was to take the pusillanimous stance of the labour and trade union leaders as indicative of the resistance of the working class to the poll tax. She also totally underestimated the capacity of the Marxists to organise a mass movement against the tax. Originally, it is now revealed, Baker, the architect of the poll tax, considered the issue so sensitive that he wanted it introduced over 12 years - death by a thousand cuts! However the
Margaret
feeble resistance of Labours front bench convinced the Tory strategists otherwise. Even then, in 198. it was planned to soften the impact in the inner city areas by a three rear phased introduction. But the clamour for its immediate introduction by the massed ranks of the Tory petty bourgeois at the 198- Tory conference, and the realisation that the full impact of the tax would be felt just before the next general election. changed the governments' mind
The critical factor however was the complete abandonment of any campaign by the labour leaders. Scotland was chosen because of the traditional militancy of the Scottish working class. With Scotland beaten into submission minimal resistance could be expected from the working class in England and Wales. This was the calculation of the Tory strategists.
If it had been left to the summits of the labour movement. Thatcher would have succeeded Indeed, the labour leaders actively assisted in smoothing its path in Scotland. Tory ministers did not need to denounce the mass nonpayment campaign. Her front line troops in this were unfortunately the leaders of the labour movement in Scotland. Without the magnificent organisation of a mass non payment campaign, resistance to the tax would have been scattered and incapable of defying the onslaught of government agencies which, buttressed by police and bailiffs. would have picked off individual protesters.
The potential for a mass movement of nonpayment existed in Scotland. But from potential to an actual movement history demons trates that the working class needs an organised focal point. This vital ingredient was supplied by the Scottish Anti-Poll Tax Federation and now by the All-Britain Federation. While the generals at the top of the labour movement abandonned the field, and from the sidelines denounced those still engaged in struggle, this organisation took root amongst the housing schemes and workplaces of Scotland. This was a broad-based movement. including different political trends and workers who subscribed to no particular political standpoint. However, Militant supporters took the initiative in founding and organising the Federation, and supplied its political backbone.
Trotsky once described the role of Marxists in a mass movement as the equivalent of a 'crystal in a saturated solution' which gathers around it all the disparate elements. The strategists of capital, as well as the labour leaders, are conscious of the decisive role played by the Militant. In Scotland, howerer, having written and rewritten the obituaries for the Militant, and eager not to give the credit to the Marxists the role of Militant was delibrately underplayed and that of the Scottish National Party
[page 10]
BILS
DONT CAM DA%
ANTI
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BREAKI
TORY
PR
PAY pAY NC
PAY Pl NO thin POL
088%
292e 2922 THE p0- TAX PAN PAI NO THE TORY DON
Mn N POLL PAY ВНЕЛК Bus:
PAY BRET NO POLL TAY PAY
5922 NO THE KOANPOL TAX NON PAYE THE TORY COLE
TAX
POLL
TAX POLL TAK
PAY
NO 681 cate
POLL
TAX
given prominence. In effect the SNP have played a minimal role in the Scottish resistance to the tax. with very little forces on the ground
In England and Wales however, the capitalists were compelled to adopt a different position. There was no English equivalent of the SNP. Moreover. Tors sategists were eager to play the red card Boner and Tory Central Office planned for mondo to denigrate and slander Militant and thereny the non-payment campaign. Baker's right-hand man was Dr Julian Lewis, a Tory 'entrist into Newham North East Labour Party in the mad jo-Os. the infamous defender of Reg Prent who subsequently joined the Tory Party
Lewis, it seems, had been in America studying the 'dirty tricks' metnod of the Republican Party. However, when these methods were deployed in March they completely rebounded on Baker. The attempt to picture Militant as the 'orchestrators' of violence cut no ice with the mass of the population. While understanding the legitimate anger of protestors, some of them youth embittered at what they had suffered under Thatcher. Wilitant pointed out that throwing a brick through a town hall window, attacking the police or looting the shops of small shopkeepers. who are also groaning under the weight of the poll tax, will not stop its implementation. Only a mass civil disobedience campaign would stop the tax and with it Thatcher.
The hired scribblers in the service of the ruling class such as Robert Harris can barely conceal their venom against Militant supporters, whom he describes as "insufferable young leaders. But he concedes that, 'in the past the government was able to enact anti-left measures — against the trade unions for example - because they had widespread public support. But the poll tax is different. It does not have the consent of the governed... it has created what Trotsky would have diagnosed as the classic pre-revolutionary phase. Elements of the petty bourgeoise, hitherto Mrs Thatcher's strongest supporters, believing their incomes and savings to be under threat, have allied themselves with the dissatisfied working Class."
The laws of revolution and counter-revolution are foreign to the superficial Harris. !! is wrong to describe the position in Britain as a classic pre-revolutionary phase. Nevertheless. the fundamentals of his analysis are correct and were predicted by Militant. He also correctly writes: "I doubt whether the ordinary voter watching the violence on television says, Look at all those horrible communists. Mabel. We must vote for Mrs. Thatcher as the only person who can deliver us from these ruffians. The voter is more likely to say Look at the latest bloody mess that woman has landed us in. Everyone told her this was going to happen, but she thought she knew better. as usual'."
London, March 31: one of the largest demonstrations ever
Tory Strati were play card
gis ea the
VIR
[page 11]
100 Spri Poll
MIR
15
Only the use
of massive
state forces
could guarantee the imposition of the poll tax
Rather than undermining support for Militant, the Tories' attacks have exactly the opposite effect. Such is the deep loathing for the poll tax, of workers but also of sections of the middle class, that those organising resis tance to its implementation have gained enormously in their eyes. A Sunday Correspondent poll on 25 March showed that 7.8 million, even before the bills had arrived, intended not to pay. This would not have been possible without the magnificent resistance of the Scottish working class. The scale of the Scottish resistance has seeped through to the population of England and Wales by a thousand different channels. The marvellous Scottish campaign, and the priceless weapon of an organisation that would co-ordinate the resistance, has had a decisive effect on the mood of millions.
This acheivement is all the greater given the ferocious opposition of the labour and trade union leaders and the perjured Tory press. In action the Scottish Federation has demonstrated that it is possible to resist the forces of the state in seizing goods for non-payment of the tax. This has proved, as Tony Benn has now belatedly recognised, that in England and Wales only the use of massive state forces could guarantee the imposition of the poll tax. But for the government this would make a desperate position absolutely catastrophic. It would prepare the ground not just for mass civil disobedience but also for industrial action which could assume general strike proportions. When ten million people say 'No' it is impossible to cow them into submission.
The poll tax has also become a lightning conductor for the accumulated bitterness at 11 years of Thatcherism. Thatcher's 'propertyowning democracy' has become a nightmare for millions. As mortgage rates soar, hundreds of thousands are in arrears and house repossessions are spiralling. One houseowner, a solictors receptionist, angrily declared to the Financial Times "we've all be conned... I've no intention of buying again if I do sell up." The attacks on the health service have completely alienated even former Tory voters.
More than 500,000 families are facing severe financial ditficulties. At least 200,000 households are in serious arrears with loan repayments. Overall, one in nine households are struggling to make ends meet with debts worth £2.9 billion, 2.4 million out of 21 million families in the UK. The much vaunted prosperity' of the Thatcher years — only a reality for a few - has floated on a sea of debt. Last year bank and building society lending totalled a colossal £90 billion.
However, refugees from home ownership will find little comfort in the rented sector. A Labour Party survey of 100 local authorities' rents showed an average rise of 10% and a
colossal 54% in parts of southern England. In Gloucester rents have risen by 35%, in Salisbury and Reigate 39%, in Cheltenham 29%, and in Merton 14%. The poll tax is just the last imposition. and not necessarily the largest.
These factors resulted in the huge electoral swing in the Mid-Staffordshire by election. the biggest by-election upset since 1935. and in recent opinion polls. The Dail! Telegraph Gallup poll on April 6 gave Labour a 24% lead over the Tories, its biggest ever. Thatcher has the lowest personal rating of any prime minister since polling began in 1938. Professor Anthony King commented that "Labour is benefitting and the government suffering from the fact that scepticism is widespread and growing about the alleged 'economic miracle' of the past decade.. around half the electorate - 51% believe that there has not been such a miracle; only 37% think there has been." The Tories have attempted to dismiss their position as 'mid-term blues. Yet no government has recovered from so far behind to win the next election.
If the polls were to be repeated in a general election the Tories would suffer an electoral massacre. Thatcher's Finchley seat would fall on a swing of 11.1%. The Scottish Secretary, Malcolm Rifkind. the departing Welsh Secretary, Peter Walker. and the poll tax ministers' David Hunt and Christopher Chope, would all go. What an answer to the ingrained sceptics headed by Neil Kinnock's guru. Eric Hobsbawn, and Marxism Today, who a year ago were arguing that Labour could not win the next election.
Indeed the Labour Party leadership itself had given up the ghost, with Kinnock contemp lating giving way to somebody else. The majority of the Parliamentary Labour Party, in desperation, had embraced proportional representation, and by implication a coalition with the 'centre' parties, as the only means of defeating Thatcher. These worthies argued that Labour's electoral base was 'shrinking, ie the working class and the Labour strongholds in the North, while that of the Tories. the middle class, the homeowners, the shareholders etc and the South was growing
We characterised this, in the language of Marxism. as impressionism, mistaking the outward appearance on the surface of society as an expression of the underlying reality. We argued on the contrary that society was moving towards an enormous class polarisation which would shatter to its foundations the Tory Party and with it Thatcherism. This in turn would completely undermine the SDP and enormous ly weaken the Liberal Party.
Our contention that Tory supporters could
pass over straight to the Labour Party was met
with scarely concealed mirth. Yet as poll analyst
[page 12]
Ivor Crewe now writes in The Independent on
sunday: 25 March, "not since 1945 have the
middle classes of middle England been so ready
to embrace the Labour Party:" The SDP. the
deserters from the Labour Party, face complete
extinction. Owen graciously condescended to
endorse Neil Kinnock in a general election - as
an opinion poll in his own constituency showed
Labour 26% ahead of the SDP! There is open
speculation that Owen might stand down at the
clection rather than risk a heary deteat.
Labour's front bench ascribe this swing to the
new moderate image of Labour. It is nothing of
the kind. It is primarily a massive anti-Tory
movement. Morcover the massive unpopularity
of the poll tax has more to do with the mass
campaign conducted by the anti-poll tax federa-
tions than Kinnock and the leadership of the Labour Party: History has demonstrated that only when the labour movement translates words into deeds can it draw behind its banner those sections of society who usually stand outside its orbit. The main factor in the massive
Labour vote in Scotland in 1987 was the Caterpillar workers illegal' occupation, which represented the last possibility of maintaining an industrial manufacturing base for the Scot tish economy. Bold action by the labour movement in turn drew support from the middle class and other sections not traditionally sup porting Labour.
A similar victory resulted from the heroic stand of Liverpool city council from 1983-87 Neil Kinnock seems to think that slavish accep rance of patently unjust laws will draw the middle class and the more inert and politically uneducated workers to Labour. It is exactly the reverse. Of course the labour movement would accept those laws that prevent crime against ordinary people and their personal propert! Yet not one of the rights that the working class possess today, the right to strike, freedom ot assembly, to form unions, or a tree press, would have been conceded unless the pioneers of the labour movement had not been prepared to break unjust laws.
Another 'legal' refuge for the Labour leaders is the argument that Labour in opposition must obey the law for fear that when the Tories are in opposition they will also break laws that thes don't like. This argument is childish and betrays i complete ignorance of the real lessons of history. When have the ruling class ever allowcd legal niceties or constitutions to stand in their way in seeking to overthrow not just laws but governments which threaten their vital interests? The legally elected government of Allende in Chile was brutally overthrown by a military coup in 1973. Faced with a similiar situation the British ruling class would not hestitate to resort
similiar measures.
If it is objected
such 'unconstitutic
hestitate to resort to similiar measures.
that
NO
in No
NO NO
1E3
PULL TAX
PAY
ULTA
2 mullton peppe orene
IA S cutar
LOT ONE PERSON.. ber
actions are possible abroad but not in 'democ-
ratic Britain. then what about the 191* Cur-
ragh mutiny? Then the British officer corps stationed in Ireland staged a mutiny, encouraged and supported by the Tory leader Bonar Las: eftective! preventing the Liberal government granting Home Rule to Ireland.
'Yes hut this is all in the dim and distant past. the right wing reformists will object. But the Labour government of 196÷-70 introduced a variation of a wealth tax, the Corporation Bill, which amongst other things attempted to restrict the income of company directors. This was denounced in the City of London as a Bol- -herit measure. Such was the colossal pressure alerted by the handful of monopolists who control industry and the banks that the then Labour government introduced 134 amendments to neuter the Bill. The Labour leadership have a completely non-class approach, in effect i bourgeois conception of the law, which flies in the face of the historical experience of the labour movement. If a future Labour government introduced measures to benefit the working class and was met by Tory extra- Parliamentary resistance, then it would have to call upon the forces of the labour movement to ensure the implementation of those laws.
Neil Kinnock, at the Scottish Labour Party Conference, correctly stated that millions will not be able to pay the poll tax. He then went on to denounce those who were prepared to assist the poor in their resistance to such an unjust measure. But Kinnock's dismissal of Militant supporters as toy town revolutionaries" is not echoed by the serious strategists of capital. They well understand the vital role which
Lobby in Stroud. "Not since 1945 have the middle classı of middle England beei so ready to embrace the Labour Party Ivor Crewe.
The Independent on Sunday
[page 13]
120 Spri Poll
MIR
15 Tax
The
Economist
magazine surveyed city conomists on
their views on a Labour
government.
"Do they
tremble in
their lir-conditioned
towers? NO,
three fifths
believe Labour would
either be good for the
economy or
make no
difference."
14 April
1990
Militant supporters have played. Hence the unprecedented explicit denunciation by the prime minister and the chairman of the Tory Party in the House of Commons. The attempt of both front benches to picture Militant supporters as 'alien', seeking to 'hi-jack' the antipoll tax movement, has cut no ice with the mass of the population. Nor will Kinnock's attempts to once more engage in a witchunt stop the advance of the anti-poll tax movement or the forces of Marxism.
Kinnock is not at all original in this respect. The TUC General Council banned the Unemployed Workers Movement in the 1930s but this did not prevent the mass hunger marches which had the overwhelming support of the working class. Marx wrote that 'once an idea grips the minds of the masses it becomes a material force? Millions have decided that they are not going to pay. They have turned to those who have the strategy and tactics to ensure victory in this struggle. Black propaganda from the Tories, as well as denunciation from Labour's right, will be as effective as a dew-drop on a hot stove.
Is it possible however for Thatcher to escape? Maintaining the tax in place is a guarantee of electoral slaughter. Any concessions have always been "too little and too late'. And rather than mollifying the opposition, the circle of discontent has been widened. The dilemma of the government has been summed up surpris. ingly by Norman Tebbit, not the most sensitive of political commentators. He bewailed the fact that the Tories now appear to be 'dogged by the 'rottweiler syndrome'. Such is the adverse press tor rottweilers, that it one were to jump into a river to save a drowning baby, it would be attacked for wanting to eat the baby! Thatcher will be damned if she does not give concessions but also if she does.
This does not mean that out of sheer desperation the Tories will not attempt to at least mollify the opposition of their own sup porters to the tax. Thus Environment Minister Patten has 'capped' the poll tax levels of 20 Labour councils. This panicky measure, introduced at the behest of Thatcher with Patten himself reluctantly acquiesing. is a brazen act of political spite which will further rebound on the government. It has undermined the raison d'etre of the poll tax, of 'local' as opposed to government control, and it will not result in huge financial gains to poll tax payers. It will however slash jobs and services in the 'capped authorities, resulting in a 'Bradford situation'. with the closure of schools, old peoples homes.
Meals on Wheels etc. Given the mounting opposition in local government unions like
NALGO to being put in the invidious position of acting as collectors of the hated tax, capping is a formula for further inflaming the situation.
Concessions, to have any effect. would have to be huge. One billion pounds extra expenditure would only reduce poll tax bills on average by £ 28 a year, if the local authorities do not spend the extra government grant. To have any effect, the government would have to inject $5 billion or more, probably next year. slashing the government's budget surplus. This would rule out tax concessions in the run up to the election. The predicted budget surplus in any case has fallen from £1t billion last year to 28 billion this year.
On top of this the Tories are faced with a recession this year with the inevitable rise in unemployment. As the last issue of the MIR pointed out, the economic prospects confronting British capitalism are calamitous. Such are the trends in the world economy, with the rise in interest rates in Germany: Japan and America. it is likely that interest rates will be jacked up once more. The value of the pound has dropped 5% since October. This, together with rises in fares, the poll tax, water rates etc will add to underlying inflation. In the past British capitalism plugged the massive deficit in manufacturing trade with the surplus earned on 'invisibles', that is banking, insurance and profits repatriated from investments abroad. Yet Britain had a deficit on 'invisible' trade in the fourth quarter of 1989!
The rout in Mid-Staffordshire was bad enough. It has not escaped commentators that the captain of the Titanic was born in the constituency! Yet even worse looms. The May local elections will further shatter the electoral base of the Tories. Loudly proclaiming itself as a 'unionist, that is, all-British party. the Tories have been reduced to near extinction in Scotland and are an endangered species in Wales. The North is largely foreign terrority to them. And now they are under seige in the West Midlands and in the South. Against this background it is not excluded that Thatcher will be compelled to find an excuse to retire to Dulwich. Some bourgeois commentators are urging Thatcher to ditch the poll tax as a means of clinging to power. The Times. The Financial
Times. The Independent and Today are all urging Thatcher to drop the poll tax.
Things have become desperate when Mur-
doch urges Thatcher to retreat! Yet, as we have
pointed out. this will not save her. Consequent-
I! a growing Tory opposition has been sear-
ching for an alternative in the candidatures of
Howe and Heseltine. The latter has been
deliberately built up by a section of the press.
Yet Heseltine is no liberal. He initiated the sale
of council housing. fought CND and has urged a
tighter implementation of the vagrancy laws to
drive the homeless off the streets of London.
Heseltine would seek to achieve the same goals
as Thatcher only he would be prepared to bend
[page 14]
little more when facing hostile winds.
The more far-sighted Tory strategists are
seeking an escape route in a new leader, who
would resort to what John Biffen called 'the
social market economy!' This would involve a
defence of capitalism, no less determined than
Thatcher herself, but buttressed by increased
spending on education and the infrastructure
which is in any case in a disastrous state. They
hope in this way to salvage something from the
wreckage of the Tory Party: Yet a new leader
would not guarantee victory for the Tories in a general election. The pendulum has sung too far in the opposite direction. Two thirds of those polled who have sung over from the Tories to Labour would not go back again.
If Howe was to replace Thatcher he would be a modern day equivalent of Douglas Hume who replaced MacMillian in 1963. This did not prevent a Labour victory in 1964, in an economic and social situation far more favourable to the Tories than the one which looms in two years time. If Heseltine were to become leader this also would not prevent a Labour victory. Possibly Heseltine is looking towards the aftermath of the next election. Probably he is not too keen to preside over a party heading for inevitable defeat. Far better, as the strategists of capital have undoubtedly concluded, to send the British working class back to the school of reformism, to the school of a Kinnock government.
Kinnock, John Smith, Cunningham and the rest of Labour's front bench have been busy demonstrating that they, as opposed to the labour movement, offer no fundamental threat to the existence of capitalism. They are the 'second XI' of capitalism, who can be put into bat when the wicket becomes a little bit sticky. Even The Investors Chronicle has given its seal of approval to Labour's front bench: "The old ideological battleground is, after all, defunct. The primacy of the market is now recognised in theory as well as practice." The MIR supports the election of a Labour government. But we want a socialist Labour government. The experience of Spain, Greece. France. Australia, and above all, Sweden, show's that a Labour government which remains within the framework of capitalism will be forced to carry through counter-reforms.
The only guarantee that a Labour government will carry through lasting measures in the interests of the working class is to take over the handful of monopolies which control 80 of industry and introduce a socialist plan of production. Failure to do so will inevitably result in retreats and disappointment for those who repose so much trust and faith in such a government. At a certain stage of a Labour government an inevitable recoil by the trade unions in particular will take place. The
NO
POLL TAX POLL TAX
HERE
Mulent RE DON'T COLLECT NO LLECT
POLL TAX LL TAX
OLLITAX HERE ERE
DON'T COLLE DON'TCOLLECT T COLLECT DONT PAY IPAL
Swedish Social Democrats. held up as models for the British labour movement by the Kinnock leadership, have bent the knee to capital. They recently attempted to ban strikes and were met with a hurricane of opposition from below, particularly from the trade union rank and file. The Finance Minister, Feldt, was forced to resign. Those trade union leaders who went along with the anti-strike proposals are under presure to resign and the ideas of Marxism are finding a ready audience in the factories and in the ranks of the Social Democracy.
Retreats by a Kinnock Labour government after an initial delay of one or two years, will result in even greater turmoil in the British labour movement. All trends of opinion will be put to the test. This is what has already happened in the anti-poll tax movement. Only the Marxists, the supporters of Militant, were prepared to go to the end with the working class in the struggle to defeat this tax. It is this which has earned them a spectacular increase in support and influence. The attacks of the capitalist press, rather than undermining Militant, has buoyed up its support. The threats of a witch-hunt. and the actual expulsions of some of the best class fighters in the labour movement. have not gone unnoticed by the mass of ordinary workers engaged in this battle. But this has done nothing to undermine support for Militant. The poll tax is one of, if not the decisive battle we have seen in Britain in the last decade. On the basis of the strategy and tactics advanced by the Militant, it has every prospect of victory, not just over the tax but over Thatcher and the Tory government itself.
Militant ha• supplied the political backbone to the anti-poll tax struggle.
MIR
[page 15]
German unification:
capitalism triumphant?
ich a rapid n of events
cannot be understood apart from
the nternational
situation
140
Lynn absence allapse
Walsh argues that, in the
of a clear alternative, the
of East Germany's Stalinist
regime, combined with the
overwbelming impression of
prosperity in West Germany, termined the movement towards re political revolution begun by last year's mass demonstrations.
What are the prospects now?
ON 18 MARCH, the CDU-dominated Conservative Alliance won an overwhelming victory in the East German elections. The scale surprised even the most optimistic capitalist commentators. Forty-eight per cent of voters, including almost two thirds of workers, voted for Kohl's allies in the East.
This was a vote for unification, but unification in the form of immediate anschluss, or annexation, by West German capitalism. How could it happen that decisive moves towards counterrevolution, the replacement of the nationalised. planned economy (grotesquely distorted, it is true, by Stalinist bureaucracy) by the domination of Western banks and monopolies could receive such overwhelming endorsement in free elections?
Only last year, between 9 October and 9 November, mass demonstrations in Leipzig. Dresden. East Berlin and other cities brought down the Honecker regime. The movement was trigg ered by the opening of the Hungarian-Austrian border, which provided the first 'opening' in the Wall, undermining one of the regime's vital supports. At the same time, Gorbacher disavowed support for Honecker and the old guard leaders of the ruling Communist Party, the SED.
Hundreds of thousands of students, youth, and workers sang the Internationale on the streets. There was a spontaneous demand for the purging of bureaucrats and a radical democratisation of society. The outline of the political revolution could be seen on the streets and in the factories.
Tragically, howerer. the absence of a conscious Marxist party capable of giving the move. ment clear aims allowed the movement to be diverted. After the opening of the Wall on 9 November, the call for unification came to the fore. This was not an upsurge of nationalism. Merger with West German capitalism was seen as the best escape route from the blind alley of Stalinism and the quickest path to the high living standards prevailing in the Federal Republic.
Such a rapid turn of events can not be understood apart from the international situation. There is a general crisis in Stalinism, which has exhausted its ability to derelop the planned economy. At the same time, the growth of the world economy since 1981 (a distorted, onesided boom drawing on the fat accumulated in the long postwar upswing) has boosted the attractive power of the market economy, ie capitalism, especially among workers living under the grey austerity of Stalinism.
[page 16]
East Germany, moreover, is a special case among the East European states. Bordering on Europe's richest capitalist economy, with which until 1945 if formed a single nation state. the GDR inevitably came under the pressure of West German capitalism, which has always harboured a desire to reclaim its territory in the East. The collapse of East German Stalinism and the bankruptcy of the GDR's reformist parties provided the leaders of German capitalism with an historic opportunity - which was seized by Kohl. From the start, the East German elections became a proxy battle ground for the West German parties. The resulting grand coalition, composed of the CDU, SPD and Free Democrats (the surrogates of the West German parties) will enable the Bonn government to proceed with the dissolution of the GDR and the integ ration of the reconstituted Eastern Laender into the Federal Republic on the CDU's terms.
Monetary Union will be pushed through. probably by the end of the Summer, clearing the way for the beginning of privatisation of state firms and the introduction of the capitalist market. The 'Four-plus-Two' talks between the allied powers and the two German states, due to start in May, will pave the way for full unification.
The triumphal mood of the West German capitalists, however, is tempered by caution on the part of serious commentators. Congratulating Kohl on his famous victory: the Financial Times warned: "The path ahead is unlikely to be strewn with roses." Election victories do not provide magical solutions for economic and
social problems. While a majority have swung to the CDU at the moment, the working class will not passively accept capitalist measures which threaten their interests. Nor will German unification prove to be an unmixed blessing for world capitalism.
KOHL WAS PUSHED into action on reunification much quicker than he or the strategists of capital originally intended. Poehl, for example, the head of the Bundesbank, envisaged unification over five to eight years. Kohl was forced to act by the mass exodus which threatened to destabilise both the GDR and the Federal Republic.
In 1989 over 300,000 East Germans arrived in West Germany. This was in addition to a further 300.000 from the USSR and Eastern Europe. mainly from Poland. Moreover, the Bonn government estimated that another 2m East Germans were sitting 'with suitcases packed. While the initial wave of youthful migrants supplied much needed labour in some sectors of the economy, a floodtide threatened to produce explosive social tensions and a political backlash for the CDU government. In 1990. East Germans were still leaving at the rate of 2.000 a day: another 100.000 br mid-february.
Western leaders feared that a sudden collapse •i the GDR regime could produce another explosion likt Romania. In the British parliament, the Tory Minister David Howell warned that an uncontrolled exodus could mean "a vortex of chaos. a black hole which could be full of dangers." (22 February )
An anti-Stasi demonstratio in East Berli
Bundesbank president Poehl
MIR
[page 17]
160 Spri Gerr
MIR
1S any
SPD-East leader Markus Meckle.
Kohl decided to make a virtue of necessity. In February he put forward a ten-point plan for rapid monetary union and reunification under Article 23 of the FGR's Basic Law, which allows new Laender (states, like the Saarland in 1957) to join the Federal Republic.
Kohl awakened to the political advantage of presenting himself as the 'Unity Chancellor' in next December's FGR elections. At the same time, the expansionist aims of German capitalism, held in check by the postwar political settlement which denied the FGR the full political fruits of its economic power, began to reassert themselves. Unification, said Karl Hahn, boss of Volkswagen, was "an unimaginable gift of fate."
At the start of the campaign, it seemed likely that the SPD (East) would emerge as the biggest single party. As it developed, the election became a referendum on the issue of rapid unification - and Kohl was determined to be the highest bidder. At Cottbus, a few days before polling, Kohl announced: "We want savers to know that when the change in the currency comes, it will be at one-to-one for them." This carefully left open what the ceiling on one-toone conversion would be. But as the West German SPD leader, Lafontaine, said: "They had the impression that if they voted for Kohl, then the money would flow."
Kohl also reassured East Germans that "The passage to a market economy is no cause for fear, since the market order and social security are inseparable in our way of thinking." Throughout the campaign, the CDU in the East stressed the social aspect of the market economy: "Even a party of the right contending for East German votes" commented the Wall Street Journal (13 March), "is not prepared to renounce totally the country's socialist past."
Kohl addressed six massive rallies which were bigger than the SPD's. Even the editor of the Conservative West German newspaper Die Welt was amazed at the remarkable transformation of the 'sometimes bumbling, often stumbling. forever mumbling' politician into a popular hero. Kohl may lack charisma, but "He was the leader of a government which had given its citizens one of the highest standards of living in the world." (Financial Times. 20 March) Given the crumbling of the GDR's rotten Stalinist reg ime and the collapse of the economy: a big section of the electorate saw unification as the onl! road to higher living standards.
"We now realise that the GDR's economy is really rotten - and everybody deceived us about it," said a young crane driver (Wall Street (ournal, 19 March). He had voted CDU "because it's the party that will make unification happen as quickly as possible." "What would you prefer? A long, agonising death, or a quick end? l prefer the latter." commented a bureaucrat.
At Kohl's Magdeburg rally, one man said: "We have had 40 years of socialism (ie Stalinism) We have had enough. Helmut is our man." (Sunday Times, 11 March) At the start of the campaign, about 40% of the electorate were undecided. The Conservative Alliance (the CDU plus the German Social Union and the Democratic Awakening) won the support of most of these 'floating voters.
In the South especially, in Thuringia, Saxony, Sachsen-Anhalt (SPD strongholds before the Nazi regime), the workers turned out for Kohl. The electoral districts of Dresden, Erfurt, Gera, Sahl and Karl-Marx-Stadt all recorded votes for the Alliance of about 60 per cent, with less than 20 per cent for the SPD and less than 15 per cent for the PDS. According to one survey, 58 per cent of workers throughout the country voted for the Alliance. After four decades of grey, oppressive, bureaucratic 'socialism', the workers delivered their verdict on the basis of the system's dismal practical results. Industrial workers in the South have experienced even worse conditions than in Berlin and the Northern cities.
What happened to the SPD? "No doubt we are the bigggest losers in this election," admitted Markus Meckle, the SPD (East) leader. But the SPD lost, gaining 21.84% of the vote, because its leaders offered no real alternative to the CDU. From its formation last year, the Social Democratic Party (Sozialdemokratische Partie). although trying to distinguish itself from the SPD (Sozialdemokratische Partie Deutschlands), adopted a pro-capitalist position. Rapidly, however, the party in the East became a client of its rich Western patron, changing its name to SPD. They supported unification on a capitalist basis, but advocated a slower route, using Article 146 of the FGR's Basic Law, which would mean unification under a new constitution. So, while Kohl offered the fast track, the SPD appeared as the party of 'ifs' and 'buts".
Until very recently, the SPD in the West opposed reunification. Brandt, Schmidt, and other SPD leaders have never called for unification on a socialist basis. On the contrary, over many years the leadership pursued a policy of rapprochement with the Stalinist regime, and SPD leaders established close ties with Honecker and other discredited CP (SED) leaders. The SPD nevertheless drew support from many who feared that unification and the market would undermine the GDR's social welfare network, though some support appears to have been lost back to the PDS, the renamed Communist Party.
"This was a victory for the bloc parties," ruefully commented Willy Brandt, the former SPD Chancellor who spoke at big rallies in the East. The CDU (East) had long been a stooge of the SED in the Stalinist 'coalition' government.
[page 18]
Woltgang Schnur, leader of the Democratic
Awakening, was forced to resign after his links
with the Stasi were revealed. When Lothar de
Maiziere became head of the CDU last Novem-
ber, he replaced Gerald Goetting, who is now
awaiting trial on charges of corruption. Yet the
sordid past of the Conservative leaders in the
East has been like a little speck of effluent swept
away by the political tide. Voters overwhelm-
ingly voted on the basis of the parties' current
proposals for the immediate future, not on an
assessment of their past record
Mass revulsion against Stalinism, which has
poisoned the popular conception of socialism,
meant that the SPD suffered from what Willy
Brandt described as "unfair comparisons bet-
ween communism (ie Stalinism) and social
democracy:" (Financial Times, 19 March) The
Conservative Alliance played on widespread
fears that the SPD might provide a means for the
SED leaders to find a way back to power. The
CDU took a lion's share of the estimated DM20
million which was reportedly funnelled into the election campaign. (Wall Street Journal, 19 March) Almost daily: their propaganda machine produced anonymous leaflets alleging that the SPD was dominated by former communists. "A lot of communists threw their Little Red Book away and joined the SPD, hoping to save their privileged position," a middle-aged man from Bitterfeld said. "I am frightened they will just form a coalition with the communists and it will be the same mess all over again. I am voting Christian Democrat so it doesn't happen." (Sunday Times, 11 March)
Alliance 90 (Bundis 90), the left coalition made up of New Forum, Democracy Now, and Initiative for Peace and Human Rights, received a mere 2.9 per cent of the votes. The New Forum leaders were unceremoniously pushed aside by the surrogates of the main West German parties. While Havel is president in Prague and Kuron, Minister of Labour in Warsaw, the intellectuals who were projected into the limelight by last year's mass demonstrations have been dropped back into obscurity.
Jan Peter, editor of Leipzig's The Otber Paper, nostalgically recalled the heady days of the mass demonstrations, "when we thought we could have a separate democratic. but socialist, state here." (Correspondent, 18 February) The writers, artists, and intellectuals who had in many cases courageously opposed the Honecker regime were incapable of giving direction to the movement. Lublich Mehlhorn admitted that, "When the communists fell, there was a power vacuum. We were unable to fill it, so the West Germans stepped in." (Independent, 17 March) They called for an 'alternative' socialist society, but they had no understanding of the character of the bureaucracy, which is a ruling elite, a social strata based on material privilege.
The New Forum called vaguely for democrat-
isation. Some believed that they could replace
Stalinism by a 'user-friendly' form of socialism
without the overthrow of the bureaucracy.
Many of the leading supporters of the New
Forum, however, while they claimed to defend
socialism, actually supported the introduction
of the market. Now, the intellectuals blame the
workers for the derailing of the revolution. "It's
the triumph of money over ideology," comm-
ented the East German novelist, Thomas Bras-
ch. "The people in East Germany rose up - and
went to Woolworths." Another, Rainer Pietsch,
said: "As soon as the border was open, the rev-
olution was over. People went over to West
Germany and were spell-bound. It was no lon-
ger 'We are the people', but 'We are one peo-
ple'. Unification suddenly appeared to be the answer to their dreams." But the revolution took this direction because of the weakness of the subjective factor, the political conscious-
ness of the working class, and the absence of a party based on Marxism. The leaders of New Forum, while blaming the workers, have confessed their own political bankruptcy. There was no party capable of putting forward the programme of workers' democracy, of fighting for the perspective of the political revolution, or of raising the call for the socialist unification of Germany.
The political revolution which began in the mass demonstrations last year has therefore suffered a severe setback. The workers and youth rose up against the totalitarian regime of Honecker. The regime was toppled, and through the intervention of the workers from below, the Stasi was disbanded and corruption exposed and rooted out. The workers formed committees in the factories and began to move to take democratic control into their own hands.
But in the absence of a clear alternative, the collapse of the Stalinist regime combined with the overwhelming impression of prosperity in West Germany undermined the movement towards the political revolution. The spontaneous mass initiative on the streets dissipated. With the rapid move towards elections in the East, the movement was diverted to the electoral plane. The majority of workers, desperate to find a way out of the Stalinist blind alley and despite skepticism among some more conssious layers. then began to look towards the West German parties in the hope that they could accelerate progress towards West German levels of prosperity.
The party which ruled over the GDR and defended its socialist achievements, the Communist Party: formerly called the Socialist Unity Party (SED) and now renamed the Party of Democratic Socialism. gained a mere 16.33 per cent of the votes. True. this was more than the
MIR Spring
Geri
•17 1990 lany
Willy Brandt and Oscar Lafontaine.
[page 19]
unification with Germany. After the First World creative power of the working class would be 180 MIR predicted 12 per cent! Its highest vote was in Spring 1990 East Berlin, where it received 29.97 per cent of Germany'
the votes, coming second to the SPD. which received 34.95 per cent (the CDU and allies received only 21.62 per cent in East Berlin). In Berlin, especially, which is the centre of a massive bureaucratic apparatus, the PDS's vote reflected the loyalty of a large section of the state and party bureaucracy: as well as continued support from intellectuals whose positions depend on the nationalised economy and government institutions. A small section of workers voted for the PDS. seeing it as the best defence against the privatisation of industry and the dismantling of welfare provision. Nevertheless, such a vote is a monumental condemnation of the Stalinists record.
The new leadership under Gysi are now presenting themselves as ready to play the role of a loyal opposition under a capitalist government. But for forty years they lived privileged lives on the backs of the workers. Their bureaucratic methods discredit the idea of socialism. In the last analysis, it was the Stalinist leaders who delivered the East German workers - for the moment - into the hands of the West German parties of capitalism.
CAN UNIFICATION, IN any way, be considered a step forward from the standpoint of the working class? After all, Mark and Engels hailed German unification under Bismarck as an advance. Bismarck acted as a Bonapartist, leaning for Gregor Gysi.
support on the reactionary Junker landlords. Nevertheless, his measures demolished many of the feudal remnants, clearing the ground for the development of capitalism. This meant, in turn, the growth of an industrial proletariat, creating more favourable conditions for the struggle for socialism.
Unification under Kohl. however, is a backward step. Marxists support the right to selfdetermination. But self-determination cannot be separated from the contending class forces involved. By whom is unification being carried out? In whose interests? And what consequen ces will follow for the working class? Unification is not a transcendental good which allows these questions to be ignored.
Writing in 1939 (with reference to the Ukraine), Leon Trotsky said: "The right of national self-determination is, of course, a democratic and not a Socialist principle. But genuinely democratic principles are supported and realised in our era only by the revolutionary proletariat: it is for this very reason that they are interlaced with socialist tasks." (Trotsky, Writings 1939-40, p+5) Earlier, with regard to the Saar, Trotsky sharply criticised the leaders of the German CP, who initially advocated a 'yes' vote over re- War, this German area was placed under the League of Nations, with France controlling the coal mines as a form of war reparations. Its future was to be decided by a referendum fixed for 1935. By then, however, the Nazis had come to power, and the call for the return of the Saar was a prominent nationalistic plank in Hitler's demagogic programme.
"To rally to Hitlerite Germany in practice, ie through the referendum,"
Trotsky.
wrote "means, theoretically speaking, to put national mystification above the class interest and psychologically to conduct a really cur-like policy Naturally, only traitors can demand annexation at present, for that means to sacrifice the most concrete and vital question of the German workers in the Saar territory to the abstract. national factor." (Writings 1933-34, p135) The present Federal Republic is not, of course, a fascist state like Hitler's; the working class still possesses democratic rights. Never theless, unification under the present circumstances will be through capitalist counter-revolution, even if it takes a democratic form, with parliamentary and trade union rights being spread to the East. It will entail the replacement of the nationalised, planned economy of East Germany by the domination of the big banks and monopolies and the anarchy of the market. This will be an historical regression. The planned economy, despite Stalinism, still represents an advance over capitalism. Planned production, under democratic management, remains the only means by which the proletariat can take control of society into its own hands. In recent years, the bureaucracy has squandered the gains of the planned economy. The advantages of the plan over the market system. particularly in comparison to West Germany, appear to have been largely cancelled out. An assessment of the current results of planning, that is, the actual economic record of the bureaucracy, is obviously of decisive importance to the workers living under a Stalinist regime. But this is not the same thing as evaluating the historical potential of the underlying property relations and mode of production.
Unification would be progressive only if it extended the planned economy: with the addition of workers democracy, to the whole of Germany. This would require a combination of the political revolution in the East and social rerolution in the West. In the GDR, the burcaucracy would be replaced by the democratic rule of the working class. In the FGR, a fundamental transformation of property relations would be required, replacing capitalism with a planned economy, under democratic management and control. The combined resources of East and West Germany would then provide the basis for unparallelled social progress. The
[page 20]
tapped as never before. Such a transformation,
moreover, would not be confined to a unified
Germany, but would spill over into both the
capitalist West and the Stalinist East.
Therefore, Marxists stand for the socialist
unification of Germany by the working class.
Unification by the capitalist class, even under
the democratic conditions which exist now,
will inevitably have reactionary consequences
for the proletariat.
Today, the GDR's planned economy is por-
trayed as a totally negative phenomenon, not
only by capitalist commentators but also by the
demoralised Stalinist leaders. The top bureau-
crats themselves lost confidence in their ability
to run society on the basis of planning. For ex-
ample, before 18 March, the boss of Mikroelek-
tronik, one of the most modern state firms, said
he favoured unification and the market (capit-
alism) rather than the 'chaos of uncertainty.'
After the results, the boss of Robotron, the lat-
gest electronics combine, welcomed the maj-
ority of the CDU. "We (the Robotron manage-
ment) believe this is the most favourable result
the Kombinate could have hoped for." (Finan-
cial Times, 20 March) For the workers, as the
Mikroelektroniks boss admitted, the market
would mean "inevitable social hardship." The
bureaucrats, on the other hand, could afford to
take a more positive view because many of them had already fixed up jobs for themselves with big West German companies. Reporting on the Leipzig trade fair, the Financial Times (12 March) noticed many "old faces wearing new masks."
But in spite of the bureaucracy, the plan, for two or three decades, did mean social progress. Up to the early 1970s, the foundations of a modern, industrial economy were laid. Industrial production grew seven-fold between 1950 and 1975 (71% between 1961-70 and 38% between 1971-75). "By the mid-1970s," writes Martin McCauley, in The GDR since 1945, "the GDR was a modern, industrial society. The dominance of industry: the rise in the level of skill and expertise of the labour force, especially the growth in the number of university and technical college graduates. heralded a future in which more and more could be expected from scientific-technical progress.
Even with workers' living standards, which cannot be measured by a single yardstick, there were significant gains. Employment was guaranteed for workers, including the vast majority of women. Rents were low: taking less than five per cent of average income. Comprehensive child care and nursery education were devel oped, and even the capitalist commentators are forced to acknowledge the quality and scope of the GDR's welfare services, though they have deteriorated recently.
However, workers' appreciation of these
gains have been offset in recent years by the
short supply and especially the poor quality of
consumer goods. This was glaringly highlighted
by the contrast with the seeming abundance of
all the latest consumer goods in West Germany.
Material frustrations were sharpened by the
lack of progress towards the more egalitarian,
democratic society continually promised by the
bureaucracy. The greyness, the stultifying con-
formity, and the hopelessness of real existing
socialism' brought deeper and deeper alienat-
ion from the Stalinist system.
Underlying the falling back in the field of
consumer goods and services was the slow-
down in economic growth. The bureaucracy
could take the nationalised economy only so far.
It was able to build up heavy industry and mass
production units. But it cannot cope with advan-
ced technology and more sophisticated modern
processes. Only workers' democracy - lethal to
the bureaucrats - could provide the necessary
methods of management and control.
The opening of the Wall on 9 November,
which mega-amplified the siren call of the West's opulent consumer market, coincided with full exposure of the rottenness of the bur-
eaucracy. The economic position was even worse than it had at first appeared. The regime had to some extent put off the crisis by ever increasing foreign loans, which now absorb about half of the GDR's hard currency export earnings to capitalist countries. Workers were stunned by the depth of the privilege and corruption of the top bureaucrats, previously largely concealed. Top party leaders enjoyed the same exclusive hunting lodges used by top Nazis up to 1944. Others accumulated hard currency fortunes in foreign bank accounts. The grotesque scale of surveillance by the Stasi, used to secure the power and privilege of the bureaucracy, was also revealed. Almost 200,000 people, or more than one in a hundred of the population, were allegedly either full-time Stasi employees or informers on their neighbours or fellow workers.
Events last October-November shattered what remained of the workers' support for the Stalinist counterfeit of socialism. Moreover, fear of the state evaporated on the streets as the youth and workers increasingly felt their own power. But the absence of a genuine Marxist alternative has allowed a profound swing to- "wards the idea of the 'market economy' (in reality, capitalism) as the answer to the workers' problems. This is undoubtedly based on profound illusions in capitalism. Nevertheless, when illusions hold sway over millions, they become a material factor in the situation. They have gained a hold because of the extreme weakness of the subjective factor, the absence of the genuine ideas of Marxism.
The current illusions in capitalism, however,
MIR Spring
Geri
•19 1990 nany
Car production in East Germany
[page 21]
200 Sprin Gerr
MIR g 15 any'
FGR Finance
minister
Waigel.
have their material roots in the present international conjuncture, which is temporary. The slow decay and recent sudden collapse of the Stalinist regimes has coincided with an apparent re-invigoration of capitalism. The post-war economic upswing since 1945 has made the Federal Republic into the most powerful European economy, rivalling Japan and catching up with the United States. The boom since 1981 is still continuing, particularly in the case of West Germany. Growth is now slowing down in the United States and Britain, and the world boom will exhaust itself in the next few years. The West German economy will not be immune to the crisis now being prepared in the world economy. Nevertheless, for the time being, it appears that West German capitalism is thriving. This has had a powerful effect on the consciousness of East German workers.
IMMEDIATE UNIFICATION THROUGH anschluss currently appears to be the quickest route to higher living standards. Underlying fears about unemployment and social welfare have been cast aside for Kohl's more optimistic promises. But in the coming months and years, the promises of the election campaign will be put to the test.
All serious commentators, West and East alike. agree that millions of jobs will be wiped out. "Unemployment in East Germany — currently estimated at about 70,000 - is likely to rise substantially as the country's moribund and inefficient companies are exposed to the full force of competition." (Financial Times, 20 March) Voigt, head of the GDR's IFA car group, warned that 60 to 70% of its work force could lose their jobs. Joachim Lezock, head of Kombinat Schuhe, the state shoe combine, predicted at the recent Leipzig trade fair that there would + to 5 million unemployed during the 'transition' to economic union with the FGR. He pointed out that the GDR's state retail organisations were already switching to West German products, and the Kombinat workers were 'holding regular demonstrations'. (Financial Times, 14 March)
The conversion of wage rates to DM at oneto-one or even at one-to-two might raise the East German workers' income levels. But big business wants to invest in the East to exploit the cheap, but relativel! skilled. labour: and "given the relatively low productivity levels of East Germany, a West German standard of living for some is all too likely to mean unemployment for many others." (Financial Times, 17 March) High unemployment in the East will be used by the capitalists to hold down pay levels in both the East and the West.
During the election campaign, Kohl promised that the social provisions would be protected after anification. The Federal government has
promised subsidies for pensions and unemployment pay. But to what extent, and for how long? Shortly after the elections, Hahn, the boss of Volkswagen, warned against "ambitious East German demands for a social charter protecting socialist ideas for guaranteed work and housing factory nurseries and canteens." (Wall Street Journal, 22 March)
The escape route to the west, meanwhile, will be increasingly closed off. Immediately after the East German election results, a number of cities and states began to stop weltare support to migrants from the East. "When the temporary camps are shut down," announced the Mayor of Hannover, "it will become clear that resettlers are to be treated like homeless persons. They have to return to where they came from." (Wall Street Journal. 21 March) The evangalists of freedom who previously denounced the Berlin Wall, are now quite prepared to use administrative and economic walls' to force workers back to the East. Bremen is turning East Germans away, while the Saarland has stopped all welfare support. Shamefully, Lafontaine, the SPD leader, has led the chorus demanding measures against East German workers migrating to the West.
When the realities of capitalism hit them, the workers who moved to bring down the Honecker dictatorship will be forced to move into action again to defend their interests. Millions of workers will come to regret their support for capitalist anschluss. Even the Financial Times (10 March) soberly warned: "The likelihood that unemployment, rents, prices and social disruption will all increase in East Germany will make unification increasingly unpopular."
Already, the Federal government is retreating on Kohl's promise of one-to-one conversion ot East Marks to Deutsche Marks. Within hours of the election results, the Bundesbank president, Poehl, was warning that 1:1 conversion would be limited to savings of 2,000 East Marks. The FGR Finance Minister, Waigel. bluntly stated that the 1:1 conversion could not apply to wages and pensions. "We must not burden the corporate sector." he said (Financial Times, 29 March). "with too many difficulties as it tries to make a start in the market economy."
Signs of a retreat on 1:1 conversion provoked angry mass protests in the East. Over 100,000 turned out in East Berlin and elsewhere in demonstrations called by the trade unions, coinciding with the opening session of the newly elected parliament. In the face of this upsurge, and with protests too from the East German parties, the Bonn government made conciliatory statements. It now seems likey that savings up to at least 4,000 East Marks as well as pensions and wages will be converted at 1:1. Prices will rise rapidly, however, and high unemployment is likely to depress wage levels. Public-
[page 22]
sector debts will be converted at 2:1, effectively writing off half the GDR's domestic debts thus reducing the cost of privatisation.
Kohl urged the CDU leader in the East, de Maiziere, to form a 'grand coalition' including the social democrats. This was "to spread the risks likely to stem from unpopular economic measures, such as cuts in subsidies." (Financial Times, 20 March) Initially, the SPD leaders refused the poisoned chalice. After playing hard to get for several days, however, they joined the
new government.
But does the success of the CDU mean that the East will now be an assured bastion of support for the Christian Democrats? The pro-unification vote, as the Financial Times commented (19 March), "almost certainly overstates the true level of support in East Germany for the mainstream conservative groupings." Similarly, the Wall Street Journal said (20 March): "It is quite possible, of course, that the East Germans who voted for the conservatives this time, may later list leftward again."
Winning the elections is likely to be the easiest step for Kohl. The West German capitalists are far from having ready-made solutions to all the problems now facing them. The underlying uncertainty was shown in the response of financial markets to the election results. The stock exchange rose, reflecting optimism about investment and profits in the East. The bond market, however, which reflects the prospects for government finances, went down, revealing investors' fears about higher state expenditure and the danger of inflation.
Prior to the elections, the banks and big business were poised for investment in the East. East Germany is seen, not only as a field of investment in its own right, but as a bridge to the market of Eastern Europe (140 million) and the USSR (280 million) - "a type of mega-market without parallel." as VW boss, Hahn, put it. (Financial Times. 23 January) Hahn said that the joint development of car production in the East between VW and the state-owned IFA would require DM5 bn investment over the next few years, most of which VW would find from its own cash reserves and profits. A spokesman of the Federation of German Stock Exchanges (Wall Street Journal. 20 February), said that "estimates indicate that amounts of up to DM500 bn (about $300 bn) would flow in to East Germany in a short time.*
But it will take time before big business begins to get a return. It will be five rears before new projects, whether joint ventures or direct investments, will start to yield real. extractable profits' Hahn admitted that current projects were still in the 'pre-feasibility stage.' Real businesses would emerge in 1993, "perhaps starting to produce a profit in 1996." (Financial Times, 15 January)
But what will be the state of the worid economy in 1996? If the world boom were to continue, then the capitalists might well reap rich profits. The boom, however, is exhausting itself: all the conditions for a new crisis are being prepared. West Germany, despite its huge trade surplus, will not escape the effects of a world recession. If there is a downturn within the next five years, the West German capitalists may well find they have made enormous investments but are unable to recoup the profits they expect. Instead of prolonging the boom, therefore, West German capitalism's enormous outlays in the East are likely to rebound on them, further aggravating the crisis.
The leaders of West German capitalism recog nise that the absorption of the East will mean enormous costs, particularly to the West German state. According to RWl, an economic institute in Essen, the overall cost to the public purse will be DM35 bn a year for the next few years. The Ministry for Labour in Bonn estimates that the social costs (eg underwriting unemployment pay and pensions) will be DM15 bn a year.
There are widely varying estimates of the costs of bringing the East's infrastructure up to the standards of a modern economy. The telephone system, railways, roads, water and power supplies all need drastic upgrading. Some estimates put the cost as high as DM2,000 bn. The cost of cleaning up the terrible pollution in the GDR is estimated at about DM200 bn.
West German capitalism still has enormous reserves. Last year, the trade surplus was DM135 bn. The net foreign assets of big business in the FRG are about DM500 bn. One indication of the affluence of the past period is that West German citizens spend DM45 billion on holidays abroad. Nevertheless, the question remains: will such expenditure be justified by the returns in the next period? Under favourable economic conditions, the absorption of the East would transform West Germany into the most powerful European economy: rivalling Japan and the United States in the world arena. In the event of a world downturn, on the other hand, West German capitalism could be acquiring an enormous liability — without the certain ty of reaping the expected rewards.
A UNIFIED GERMAN) will be sailing into uncharted waters. and there will be storms ahead. The process of integration will be complex, with many unknown factors. The anschluss greeted with enthusiasm by the capitalists today will tomorrow bring unwelcome instability and crisis.
During the postwar upswing, West German capitalism, on the basis of high and rising living standards, enjoyed relative social peace and political stability. Now the FGR will be absorb-
MIR ring
Ger.
Lothar de Maiziere.
D21 1990 rany
[page 23]
220 MIR Spring 1990 Germanı'
IN1*
International frictions loom.
ing a foreign body, a society thrown into turmoil by the degeneration of Stalinism and the inevitable dislocation caused by capitalist restoration. The lives of millions of workers in the East will be turned up-side-down. Notwithstanding the mass support for the CDU, workers in the East have a different experience and outlook. When their aroused expectations come into collision with economic reality in a capitalist Eastern zone which will remain much poorer than the rest of Germany, they will move into struggle. The experience of the mass morement in October 1989 will not be forgotten. This is recognised by the serious capitalist commentators: " ...a united Germany will be a more polarised, disharmonious and unstable place than the Federal German Republic." (Financial Times, 10 March)
One potentially inflammatory question is how the claims of former owners to property confiscated, nationalised or collectivised in the GDR will be settled. Such property includes many private homes and small farming plots, as well as more substantial property like factories.
In international relations, the emergence of a strengthened German capitalism incorporating a state extracted from the Eastern bloc will inevitably create new tensions and instability. US imperialism has signalled acceptance of unification. But this does not rule out intensified rivalry in the future between Germany and the US, particularly in a period of sharpened conflict on the world arena. Thatcher most clearly reveals the fears of West Germany's weaker capitalist neighbours. Other European states fear that up to 20% of the cost of unification will be passed on to them through reduced FGR contributions to the European Community budget and increased expenditures on the East when it becomes, in effect, an underdeveloped region of the EC. The EC has hardly begun to resolve the many different problems of integrating East Germany, undoubtedly a rich source of acrimony. There are also fears, already reflected in the Netherlands' threat to break the link between the Guilder and the DM. that increased state expenditure in the FGR will lead to a higher rate of inflation, which mould adversly effect the EMS and other major currencies
The ruling bureaucracy in the Soviet Union has also accepted unification. Gorbacher now accepts a return to capitalise in Poland and Hungary, and the departure of the GDR from the Eastern bloc. This is a major defeat for the Russian bureaucracy's longstanding foreign policy aim of maintaining an East European seeurity zone around the USSR. Publicly: Schevard. nadze has been demanding that a unified Germany should be 'neutral', ie outside Nato. From US State Department statements, however, it seems likely that the Kremlin has privately
agreed that Germany will remain in Nato, provided the Soviet Union is allowed to maintain troops in the Eastern zone - at the expense of the FGR! For the US (and Germany's other rivals), the presence of Soviet troops in an enlarged Germany will act as a certain check on the freedom of action and ambitions of West German capitalism. For the sake of their immediate objectives, Kohl and company will accept this, but such conditions will soon become irksome for the German ruling class and turn into another bone of contention between the powers.
Germany's eastern borders with Poland are also a thorny issue. In reality, West German capitalism will have to accept, for the foreseeable future, that the postwar borders will remain unchanged. During the election campaign, however, Kohl would not publicly repudiate the idea of any revision. Clumsily, he tried to link the issue with the FGR's refusal to make any further reparation payments to Poles. This was to appease ultra-right wing, nationalist opinion, especially strong among German emigres from the German territories occupied by Poland and the USSR after 1945. While not a major issue at the moment, the Polish borders will be raised again by the ultra-right in a new period of social tension.
The "Two-plus-Four' talks, between the big powers (the USSR, US, Britain and France) and the two Germanies, will no doubt reach some compromise on the immediate issues raised by reunification. But the relationship of an enlarg ed Germany to NATO and the Warsaw pact is interlinked with the fundamental economic, political and strategic relations between the super-powers. With the present detente it appears that the powers can resolve their differences through talks and compromise. But the underlying class and national-capitalist antagonisms remain. Detente, with a world economic downturn and revolutionary upheavals, will give way to a new period of tension and struggle between the powers. A united Germany, although apparently a victory for capitalism, will in no way soften the antagonisms.
The restoration of capitalism in East Germany is a big set-back for the proletariat. But the price to be paid by a temporarily triumphant German capitalism will be the incorporation of many volatile. combustible elements into its once so-solid foundations. It will not be so long before the complacency of the capitalists is shattered by stormy movements of the German workers. who will forge their own class unity in the struggle to abolish capitalism. They will reconquer the social gains squandered by Stalinism. They will build a planned economy under workers' democracy which will demonstrate the inestimable advatages of the socialist organisation of society.
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A participant's account Romania "The movement really started four years ago in Brasov by workers who began to organise protest meetings and a strike. This movement was quickly silenced by the authorities, with a massive police presence on the streets. Many people were arrested, and this succeeded in eliminating the movement for a time...
But the discontent was growing all the same. Finally, the patience of the people ran out. The explosion in Timisoara marked a new beginning. Somebody told me that Causescu was planning to call a big demonstration in Bucharest to protest against the movement in Timisoara. This kind of organised demonstration was nothing new. But this time it was different. I told my headmaster that I wanted to go too. But he said: 'You can't go, I'm only taking special people'. So the regime was only mobilising its own supporters, party members and burcaucrats. Clearly it did not trust the people. I decided to go anyway: I went on to the streets with my friends and saw many cars with flags. In Victory Square Ceausescu was speaking from a balcony. Suddenly I heard people begin to shout and boo. It was incredible.. Betreen The Romanian revolution inspired workers worldwide. Elena, an infant school teacher from Bucharest, recounts her experiences of those momentous day's.
10 and Mam on 21 December thousands of people came on to the streets of Bucharest. It was a popular explosion. The demonstrators were pacific but the police used violence. Although at this time they used batons, not guns, a lot of people were hurt. There was massive participation by the people, many active, many more passive, giving encouragement and support. The police acted very quickly. They blocked all the main streets and squares. The people couldn't get in or out. The same tactic was used all over the centre of Bucharest. I was in Romana Square about 5pm with a group of friends. We noticed a gap in the police blockade, in one of the side streets. So we left the square and went to see what was happening in other parts. Everywhere the situation was similar. We reached University Square. Suddenly a large number of armoured cars appeared. They were firing flares and water cannon in order to frighten the people and force them off the streets. But there were so many on the square, it was impossible to move them. After an hour we returned to Romana Square but were surprised to find it deserted. We found out later what had happened. In our absence the Securitate had arrived in large numbers, shooting and arresting A Securitate man recognised us as demonstrators and called to us: 'Hey. you come here!' We could not escape. He kicked me and pulled amy hair and pushed me inside a police car. I was taken to the Securitate Centre Number One where 1 was interrogated for five hours. After this I was taken in a police bus to jail where I was interrogated again. and then locked in a cell.. (See inser) On the morning of 22 December a prison doctor came in and gave us medicine and bandages. Then at 12 noon the prison director came to the cells and said: After one hour you will be MIR U23
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24 MIR Spring 1990 Romania
Iliescu.
free. We still couldn't believe it. In the end we were taken away in a nice car and released. They left me in a square but I couldn't go home immediately because I was so shaken. I hadn't really realised what had happened to me. Only now I realise how close I'd been to death. I was very lucky that they'd arrested me at that moment. Just before we returned to Romana Square the police had opened fire. Just after we were taken away another group of Securitate arrived and started firing again. The police who arrested me didn't treat me too badly. At the other centre they were much worse. Interrogation was very harsh and many people were killed or mutilated for life.
While I was in jail the revolution had triumphed. The workers came onto the streets demanding freedom for the prisoners and an end to the regime. It is thanks to these workers that 1am alive today and Ceausescu is no more. Once the workers came onto the streets there was no turning back. This was the revolution.
After the storm came the calm. People were very happy that Causescu was gone but found it difficult to understand what had happened. No one asked what would come atter.
After the old regime had been overthrown by the revolutionary workers and students, many political parties were formed. These parties wanted to take the power but were not concerned with the people. All kinds of political speculators wanted to take advantage of the revolution made by the people. Many emigres came back and tried to get the power for themselves.
The student and working-class what was happening and were very
youth angry.
saw That
I was put in a cell with 36 other girls. Some of
girls from another police station were in a very
bad condition. They had been forced to walk
between two rows of police, who beat them with sticks. Their faces were so swollen, you couldn't see
where were their noses, their ears or their eyes... One girl's skull was fractured in three places and a
dog had savaged her leg. She died in our cell that ight.
Physically I was OK but psychologically I was in a
terrible state. In the night more Securitate came to the jail. Every half hour they took somebody out of
the room for interrogation. I lay in a bed with a
blanket over my head. I thought: I can die tonight
or I can die tomorrow - but now I sleep! I was
lucky - they had no list of the prisoners in our
and they didn't take me out...
the morning a doctor came to us with medicine
bandages. I was very surprised. The police asked
we want cigarettes? Do we want food? I was very
afraid. Was this to be our last meal or cigarettes before we were shot? It seemed there were only two
possibilities - either Causescu had fallen, or the police were going to kill us.
cell
In and
do
led to another explosion. At first everyone was in tavour of the National Salvation Front. But it became clear that many of the leaders of the Front were bureaucrats and opportunists from the old regime.
On 5 January the students demonstrated for democracy. Then on 22 January another demonstration was organised by the opposition parties, the National Peasants Party and the National Liberal Party: These are pro-capitalist parties which get a lot of money from abroad and want to return to capitalism. But the Romanian workers are suspicious of these parties which they see as a threat to the gains they have made as a result of the revolution. They don't want the rule of a privileged bureaucracy. but they do not want the rule of private capitalists either. So they organised a counter-demonstration against the capitalist opposition...
Now we see the beginning of a polarisation in Romanian society. Probably the majority of workers still support the Front and Iliescu. Don't forget that Iliescu gave very important reforms after the revolution, which made him very popular. Of course these reforms were really conquered by the workers. They were not organised to take the power. Now the task is to organise.
In the factories the workers are beginning to organise committees. The students are beginning to organise their own unions. But we need help to organise genuine democratic socialist organisations. We need money to buy typewriters, duplicators, paper and books. We hope that our friends and comrades in Western Europe will give us this help. We hope that the workers and trade unions here will establish direct links with the workers of Romania so that we can learn from each others' experience. We hope that the students here will establish direct links with the Romanian students and help them to set up their own organisations.
For more than 40 years we have not had in Romania either communism or socialism, but the rule of a corrupt and brutal Stalinist bureaucracy. The revolution in Romania has begun, but it is not yet finished. We hope to establish a real socialist Romania based on the democratic rule of working people. With your help we will succeed."
The Socialist Campaign for Workers Democracy was established towards the end of 1989 following requests for aid and assistance from a number of workers' organisations in the USSR and Eastern Europe - miners' strike committees, independent trade unions and new student formations. To sponsor the campaign, or for further information, write to SCWD, co Terry Fields MP, House of Commons, London SWIA OAA. Cheques payable to SCWD.
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T'