The strange cost of victory

Centrists often tweet at me saying that supporting the Corbyn project was a mistake. Blair is the only Labour leader who consistently won elections, and, of course, socialism won’t work.

Just saying stop talking bollocks doesn’t help. Everyone who knows realises that Corbyn was sabotaged and it’s hard to say what might have happened if there had been a fair election and the poor man hadn’t been continually undermined by factions in his own party. Of course, that was never going to happen and it’s not worth arguing about. The curious double think, where the sabotage is ignored and Corbyn’s Labour were always going to fail because some pundit said so, is part of the story these folks tell.

The other thing they do is harp on about Blair’s victories. But was it though? Let’s think about this some more.

All the way back in 279 BCE a king won a battle. His name was Pyrrhus. His victory was so memorable that it has become a phrase often used in English, as in Pyrrhic victory, this being victory that costs so much you have little left. This short piece will look at some of the lasting consequences of the Blair regime and question whether the winning so much lauded by some centrists was anything of the sort. After all, it is predicated on Blair being some kind of progressive, and even that is now easily recognised as debatable.

Labour was founded in part by the trade unions. They were unhappy with not having enough of a voice in the British Parliament and wanted a party they could have direct input into. This relationship was often used by Tories to pretend that Labour was beholden to the unions. The answer to this is so what? If you think about it, is it any different from being beholden to the people who think they own everything and everybody like the Tories? Who controls the trade unions, at least in theory? Their members. So in reality is there a divide with working class people as preached by our dead from the neck up media?

Thatcher defeated the miners and the other strong unions (Railways and Engineering) by using extreme violence and in part a variety of anti trade union legislation that her goverment introduced. Earlier Tory governments had tried to introduce similar legislation this and were roundly trounced in the late 70’s.

So, one of the things that Labour promised to its founders was a repeal of the legislation when it got back into power.

This never happened and has been conveniently forgotten.

The recent lack of support for the teaching unions over the attempts to force schools to open during the pandemic is more of the same. Support for trade unionists is dubious and partial at best, the middle class centrists who now run the party are terrified of people working collectively to protect themselves because they don’t understand it, it’s not sufficiently aspirational.

So, when we’re talking about winning with Blair this is the first win.

Next, let’s talk about the organisation of the NHS. Thatcher inherited a monolithic organisation that was run nationally and financed centrally. It was not something that could easily be privatised. That said, there are strategies and techniques in place that allow the break up of such monolithic organisations. These are very similar to ones used by businesses that are planning to off shore their manufacturing arm.

• Create a management layer that splits the comissioning of the work
  from the doing of the work
• Break large national organisation into smaller regional ones
• Allow external companies to bid for pieces of work now they are small
  enough to be manageable.
• Transfer the staff to the external companies so they lose their rights
  and are cheaper to employ. In the case of the NHS this is how
  companies can make money from a service that was designed to not have any kind of surplus, by attacking workers’ pay and conditions.

This is broadly what happened to the NHS. It’s why we now have a whole bunch of care commissions and service delivery groups in the NHS. It’s why there is a market in the NHS, allegedly to foster competition, but in fact to give external companies a way to take over the operations. A useful side effect of this is it’s easy to make cuts and give the reconstituted bureacratic layers less money to work with without it being too obvious. The tories also played games with VAT so on paper external companies were cheaper, because they could reclaim their tax, when the NHS itself was not able to. This effectively gave the external companies a 20% subsidy. As well as this, of course, the delivery parts of the NHS were never intended to make a profit. So if you allocate the same or less funds to a private company that is intended to make one the service will suffer. This isn’t rocket science.

The so-called NHS deficit (which means chronic underfunding in plain English) almost exactly matches the cost of the bogus internal market. This is no coincidence as extra funds weren’t allocated to pay for it.

Again, undoing the internal market, and removing these reforms were promised and never happened. Blair’s government did put a lot more money into the NHS, but they didn’t undo the privatisation preparations. All the tools and structures to destroy the service and replace it with a US style insurance system with the care being commissioned was left in place. All the Cameron government had to to was pick it up and run with it.

This is the second great win, of course.

Now let’s move on to the next great victory, which is the nonsense that is the Public Finance Initiative (PFI). Blair’s chancellor, Brown, had promised that he would stay within Tory spending targets. Putting aside the nonsense that a country with a sovereign currency could be said to have debt, it means that Brown had a slight quandary, in that Labour had promised to invest in the public sector and particularly the NHS but inherited spending plans that meant it wouldn’t be possible.

PFI, in essence, borrows money in a way that meant it wasn’t technically included in government borrowing. The funds required to, say, rebuild a school or hospital the Tories had neglected so long it was falling down, was turned into a financial contract. The hedge funds or whoever held the contract were entitled to interest several points over the base rate, and the hospitals or schools were obliged to make the payments first before doing anything else. If the payments don’t happen the people who hold the contract would end up owning the thing they had financed.

If you lived in the fantasy world where boom and bust was over, and everyone’s wages will increase forever, and so on this almost seems like a good idea. Of course, anyone with any sense could see it was stupid.

So now, in 2021, we have companies that failed to build hospitals or whatever and went bankrupt. We have new facilities that are technically fantastic but they haven’t been given the funds to employ staff and pay the debt on the buildings, which contributes to the so-called deficit. As usual, the money flowing around the capitalist system in the UK has been diverted into the pockets of those who already have plenty. We have a sovereign currency that means it can effectively just be called into existence, but instead of using that to invest it’s been put into the pockets of the wealthy, as usual.

Brown’s team, at the time, claimed they were rescuing PFI which could, one supposes, now seem very amusing. As usual there is now no sense of consequence or hubris. Brown keeps popping up in the commentariat and expects to be treated as something other than a bumbling has been. So, win number three for Blair (and Brown).

Then we come to the sore question of the 2008 crisis. It was a con driven by the banks to suck money out of the credit bubble by selling it back to themselves and loaning it out again over and over on ever more risky investments after downgrading the risk by lying about it. The boom was fundamentally built on fraud, allowed by the reregulation and massive cutting back of the regulators of the Thatcher era in the UK, and Regan and Clinton in the US, along with most of the other capital markets at the time. Laws put in place to stop rip offs and mis-selling, of setting your customers up to take losses while you hoovered up the money, were repealed or just ignored. Eventually the bubble burst.

Instead of jailing the fraudsters and protecting small investors the banks were bailed out. Their fraud and folly was turned into public debt, and, after being saved, bonuses were still paid. Think about this for a moment.

Win number four.

If you can remember back far enough there were in fact two Iraq wars. The first one drove the Iraqi forces out of Saudi Arabia and then left things hanging for many years (after abandoning people who rebelled against the regime to be murdered by it). So, the Iraqi people were punished for the crime of having a leader who was now out of favour with his former Western sponsors with sanctions. If they wanted to buy medical supplies, or indeed anything useful, with their oil revenues they were first price gouged and then various British and US officials decided whether or not the items could be deemed as having military applications and be denied.

So medical supplies, vaccines for children, cancer treatments and so on were not available to the ordinary Iraqis. A report in the British Medical Journal puts the number of children who died as a result of this policy, alone, at half a million. Labour at the time claimed to have an ethical foreign policy. These are not tears of laughter, they’re just tears.

Win number 5.

So, in summary:

• Let’s leave anti Trade Union legislation in place
• Let’s leave NHS provider split in place ready for Cameron
• Let’s hog tie future generations with PFI idiocy
• Let’s bail out banks & not prosecute fraud
• Let’s kill half a million kids with sanctions even before we went to
  war

Win win win win win!

This feels a lot like losing looking back in 2021. We could also talk about how various flagship policies which did actually make some kind of difference to a few people were easily dismantled when Cameron came in. Not discussed here, either, is Brown selling of the UK gold reserves at a massive discount, or his changing the tax regime so that single people on fixed incomes were properly shafted. These are minor wins, obviously.

So, Tony Blair is the only Labour leader who won two elections since the war.

So what?

The boot appeared to be lifted off our necks for a few years, only to make sure it could come back down more firmly later once the ground had been prepared for more misery.