British Workers

As we wait impatiently while the Brits go through the interminable travail of Brexit, let us have a look at who they are. Not directly in a social, cultural or political sense, but by reviewing the data on UK employment. Work gives a foundation for people’s daily lives and will, in turn, have an impact on society, culture and politics. The employment numbers challenge the conceptions of many, especially those with a narrow ‘industrial’ view of the British working class. They also highlight that a surprising number of people, for various reasons, are not working at all, and that UK residents originally from other European Union countries are more likely to be employed than indigenous Brits.

Swamped?

According to the UK Office for National Statistics, the total UK population was 65.6 million people in 2018, with a couple of percent more women than men. Roughly 86% of these were born in the UK. Poland and India were the countries of origin for the largest number of others, each with 832,000. Pakistan (535k), Romania (392k) and the Irish Republic (369k) were next in line as other countries of origin. Even for Poland and India, their share of the total population was just under 1.3% each. Calculations of people by their claimed nationality give only slightly different data, and the overall picture is not simply that most people in the UK were born in the UK, as one would expect, but also that there has been no great influx of people from any one other country.

Even if the EU were taken as a whole, UK residents born in the 27 other EU countries amounted to only 3.6 million people, just 5.5% of the UK population. That figure was a slightly higher 5.8% in England, the major Brexit-voting country. Although this share is about three times higher than in 2004, a rapid increase, the still low percentage leads one to suspect that the anti-EU sentiment revealed in the dominant English Brexit vote (53.4% for Leave) has been based on something more than simply the scale of the EU immigration numbers.

A number of commentators have argued that it was the rapid influx of EU migrants after the accession to the EU of Poland and other countries in 2004 that led to worries on the part of British people about their domestic culture and ‘way of life’ being undermined by this development.[1] A look at the UK’s employment data will suggest a different perspective.

What about the workers?

In mid-2019, there were about 41.3 million people in the UK aged 16-64, the prime age group for employment. Of these, 31.5 million, or 76%, were employed, 1.3 million were unemployed and 8.6 million were ‘economically inactive’. Employed and unemployed are reasonably straightforward terms – although with changing definitions – but the latter one is worth examining further.

The ‘economically inactive’ category includes those who are students, those who are looking after the family or home, the temporarily sick, the long-term sick, ‘discouraged workers’ and the retired. It also includes some other reasons for inactivity, but basically means those who have not been seeking work in the past four weeks and who are not available for work in the next two weeks. It does not include those registered as unemployed.

At 8.6 million people, the number of the ‘inactives’ is surprisingly high: 21% of the population aged 16 to 64. Nevertheless, the inactivity rate has fallen over the past five decades, largely because of more women working. Over 40% of women were ‘inactive’ in the 1970s, but this has fallen to around 25-26% today. By comparison, the inactivity rate of males aged 16-64 has risen a lot – from around 6% in the 1970s to 16% in 2001, and it was 16.4% in the latest period. This is one way that the capitalist labour market, in its usual perverse manner, has tackled gender inequality. It is also linked to how female earnings can still remain below male earnings doing the same job, despite laws against such discrimination.[2]

The surprise at the high number is reduced when one takes account of 2.2 million students and another 2 million people looking after the family or home included in the total. But that still leaves another two big categories: 1.1 million who have retired before the age of 65, and 2.1 million who are long-term sick. Only 1.9 million of the 8.6 million inactives are recorded as wanting to have a job.

In addition to the inactive numbers, in mid-2019 there were also 333,000 people who had been unemployed for over a year but were still looking for a job. They are counted in the unemployment figures, which totalled 1.3 million, 3.9% of the workforce.

Economic activity divergence

There is a big divergence between the proportion of UK-born people who are economically ‘active’ and those who were born in other EU countries. In mid-2019, 76.3% of the UK-born population aged 16-64 was economically active, a rate which has slowly increased from a recession-hit 71% in 2010. By comparison, for those born in the original group of EU member states, named the EU-14,[3] the activity rate was higher, at 80.2% in 2019.

Much higher again was the economic activity rate of those born in the EU-A8 countries, among the group that joined the EU in 2004,[4] and which contains the famous ‘Polish plumber’: it was 85.2%. For Romania and Bulgaria, who joined the EU in 2007, the economic activity rate was highest of all, at 86.2%.

Recent migrants will tend to be the more economically mobile and more likely to be in the active workforce. They will also include fewer students, fewer people who have retired before the age of 65 and fewer long-term sick. These factors will tend to push the economically active rate of that population group higher. However, at the same time, there are other things, some less amenable to coverage in official statistics, yet clear in numerous anecdotal reports, which also account for the higher employment rate of the newer EU members.

For the EU countries that joined from 2004, a BBC report last year showed that these workers had hourly pay rates around 25% less than for UK nationals. This was despite them having average skill levels higher than for UK nationals. The skill-pay relationship only seemed to apply for workers from the EU-14 countries: their skill levels were much higher than for UK nationals, although they had pay rates only around 10% higher.

Many of those from the newer EU members included in the British working class have done low-paid jobs that British-born workers were reluctant to do, such as food processing and picking fruit and vegetables in fields. However, they are also in more skilled occupations, and not simply the skilled manual ones that led to the ‘Polish plumber’ term.

Workforce breakdown

Turning back to the British workforce, the following table gives a breakdown of the number of jobs in the UK by sector in June 2019. These sectors are based on standard classifications and are a bit broad. They can also be impacted by changes in the labour market over time. For example, if I recall correctly, it used to be the case that canteen workers in a workplace used to be counted in the total of people in that particular workplace sector. But with the outsourcing of most canteen services to outside companies, they would mostly be included instead under ‘accommodation and food services’. Nevertheless, the breakdown of the types of jobs done in the UK does a lot to question the common ideas people have about the relative importance of different jobs.

For example, while Britain may not be a ‘nation of shopkeepers’, it turns out that the biggest sector of UK employment has five million people in the wholesale and retail trades. The large numbers in health, professional, education and administration will not be a surprise to many, but each of these areas employs more people than the whole of manufacturing industry, which itself is not that far ahead of accommodation and food services. The much-maligned financial and insurance services sector employs over a million people, not all of whom are in the City of London. Another million have jobs in the arts, entertainment and recreation sector, and there are ten times more people employed in estate agencies than in mining and quarrying. A further detail is that more than 150,000 have ‘jobs’ in the armed forces.

Table: UK Employment Breakdown, June 2019

Employment in sector	Number (000)	Percent
Wholesale, retail trade, incl repair of vehicles	4,997	14.0%
Human health & social work activities	4,538	12.7%
Professional, scientific, technical activities	3,156	8.8%
Education	2,970	8.3%
Administration, support services	2,968	8.3%
Manufacturing	2,729	7.7%
Accommodation & food services	2,470	6.9%
Construction	2,369	6.6%
Transport & storage	1,789	5.0%
Information & communication	1,620	4.5%
Public administration, defence, etc	1,510	4.2%
of which, HM armed forces	152	0.4%
Financial & insurance services	1,113	3.1%
Arts, entertainment, recreation	1,053	3.0%
Real estate activities	572	1.6%
Agriculture, forestry & fishing	366	1.0%
Water supply, sewerage, etc	239	0.7%
Electricity, gas, etc	141	0.4%
Mining & quarrying	57	0.2%
Other sectors	1,010	2.8%
Total jobs in all sectors	35,667	100%
Note: Services sector total	29,766	83.5%
Note: The data count the number of jobs in each sector and not the number of different people. The total of jobs exceeds the total number of people in the workforce.
Source: ONS, Labour Market Overview, UK: October 2019

Overall, services sector jobs make up nearly 84% of the total number of jobs in the UK. This makes the common refrain from the British left about ‘industry’ – let alone ‘manufacturing’, which got a special mention in Jeremy Corbyn’s Brexit policy statement in Parliament on Saturday 19 October – seem more than a little out of touch with the reality of contemporary employment.

Conclusion

Many British workers voted for Brexit in June 2016, and many were enticed by the ‘take back control’ argument of the Leave campaign – a phrase that was a poorly disguised attack on migration from the EU. The data show that although the number of EU migrants into the British workforce rose fairly rapidly after 2004, it remained a relatively small proportion of the total. The data also indicate that an underlying problem for British-born workers was the much higher employability of the more recent EU migrants, whether that was due to their higher levels of skill or to their lower wage rates, or both.

Workers often react to labour market competition in a reactionary way. The irony is that they usually support the capitalist system and the capitalist labour market, but then complain if how these operate does not turn out well for them. The result is that they call upon the state to stop or control immigration. Far from any notion of ‘workers of the world unite’, the sentiment instead has been ‘British jobs for British workers’, something supported by the Labour Party and, implicitly, by sections of the useless left.

A basic minimum demand for anyone with a sense of justice is that all workers should get the same rights and protections, ‘immigrant’ or not. That might be the most justice one can get from a labour market based upon a capitalist system that oppresses workers and destroys society.

Tony Norfield, 22 October 2019

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[1] A comprehensive assertion of this view is from academic authors Roger Eatwell and Matthew Goodwin in their National Populism: The Revolt Against Liberal Democracy, Pelican 2018, which I critique here.

[2] This point excludes the other feature of the labour market, that many occupations are dominated by one gender, and those with a preponderance of women often have lower wage rates.

[3] The EU-14 is made up from those countries who joined the EU before 2004, but excluding the UK in these UK statistics of other countries. The 14 are: Belgium, Denmark, France, Germany, Greece, Ireland, Italy, Luxembourg, Netherlands, Portugal, Spain, Austria, Finland and Sweden. The latter three joined the EU in 1995.

[4] In 2004, 10 countries joined an expanded EU, but the EU-A8 definition excludes Malta and Cyprus who also joined then, presumably because they were formerly British colonies. The EU-A8 countries are: Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Slovakia and Slovenia.

Liberals, the Populist Right & the Politics of Imperialism

Roger Eatwell and Matthew Goodwin, National Populism: The Revolt Against Liberal Democracy, Pelican Books, October 2018

How to respond to the rise of national populism? The phenomenon is evident not only in Trump’s US but throughout Europe, as shown in this book’s comprehensive review of changes in mass opinion. The book also attempts to provide a solution to the problem, one that will defend democracy, but in doing so it inadvertently highlights the bankruptcy of the liberal outlook. They detail how, over the past two decades and more, new political forces have undermined support for the traditional political parties in the West, and especially for the social democratic parties of western Europe. Yet their ‘solution’ is to make concessions to reactionary views in order to ‘engage with’ the concerns people express in opinion polls. Like many liberal commentators, on the face of it they will have no truck with racism. But they seem to be fine with the nationalist mentality and an anti-immigration stance, and they persistently raise the question of ethnicity in national politics.

The book’s real value is in documenting how pervasive are reactionary opinions in the West. They show how the success of Trump, et al, cannot be put down to ‘angry old white men’, who will all die soon anyway, or simply to those who have lost out economically with ‘globalisation’, and who may then be attracted to a left-wing party’s plans for economic reform. The political problem in the West is far deeper, and more depressing. As they put it: ‘people who support national populism are not merely protesting: they are choosing to endorse views that appeal to them’ (p 39).

Four D national populism

Eatwell and Goodwin organise their work along the lines of what they call the Four Ds. This is how the ‘elitist nature of liberal democracy has promoted distrust of politicians and institutions’, how ‘immigration and hyper ethnic change are cultivating strong fears about the possible destruction of the national group’s historic identity and established ways of life’, how ‘neoliberal globalised economics has stoked strong feelings of what psychologists call relative deprivation as a result of rising inequalities of income and wealth in the west and a loss of faith in a better future’, and finally, the ‘weakening bonds between the traditional mainstream parties and the people, or what we refer to as de-alignment’ (pp xxi-xxiii).

If you are already finding your blood beginning to boil with a phrase like ‘immigration and hyper ethnic change’, then I recommend taking a few deep breaths because things get worse. Worse because of the reality they describe, not because the authors are closet racists hiding behind academic language – although in some of the things they write, they will come close to readers interpreting them that way. Towards the end of the book, they sum up the argument as follows:

“The ‘Four Ds’ have left large numbers of people in the West instinctively receptive to the claims being made by national populism: that politicians do not listen to them, even treat them with contempt, that immigrants and ethnic minorities benefit at the expense of ‘natives’, and that hyper ethnic change and in particular Islam pose a new and major threat to the national group, its culture and way of life.” (p 272)

I will deal with these D issues a little later, but first it is worth covering some of the characteristics of voters that the authors set out. In the end, these are the decisive people in a democracy.

Having paid a lot of attention to the social dimensions of voting, they note that the unemployed and those very dependent on welfare payments tend to vote less than average, that the youth vote also tends to be below par and that, at least in the past, white workers without degrees were under-represented in samples taken of popular opinion, which helped lead to the poll surprises of Trump and Brexit. In their view, it is the ‘middle educated’ who are most open to national populism – those who are not uneducated, but who do not have university degrees.

This middle group also tends to feel more vulnerable than others, being above the unemployed but below the middle class economically. In the UK, it was the group focused upon in the Conservative Party’s term ‘just-about-managing families’. However, this is not to say that better off workers did not vote for Trump or Brexit, or for populist causes in general, or that support only came from white (male) workers. They show that national populism also gets significant, if usually minority support from younger people, women and ethnic minorities.

One reason is that the national populists also address welfare issues. This helps undercut the traditional capitalist state-dependent approaches to national politics of more left-wing parties and groups. For example, the leader of the conservative, populist Sweden Democrats argued that ‘The election is a choice between mass immigration and welfare. You choose’ (p71).

Immigration, racism and nationalism

The authors are clear about their perspectives, which should help readers also to clarify what they think about these issues. Take the question of racism. I raise this question, because, when the authors do talk about racism, they appear to cross the line into endorsing what a United Nations Convention would call ‘racial discrimination’.[1] The UN defines such discrimination as being on the basis of ‘race, colour, descent, or national or ethnic origin’ and, in discussing popular political views, the authors write:

“We do not think that the term ‘racism’ should be applied solely because people seek to retain the broad parameters of the ethnic base of a country and its national identity, even though this can involve discriminating against outside groups” (p 75).

Unless the word ‘broad’ somehow lets them off, ‘retaining the broad parameters of the ethnic base of a country’ would indeed be racial discrimination according to the UN!

Are they only describing how such views exist, rather than endorsing or advocating them? I found the focus on ethnicity to be a strange one for these UK academics to spend much time on since, in the Brexit debate, for example, it was clear that race and ethnicity had little or nothing to do with the anti-EU case. Instead, popular views were much more concerned about competition in the jobs market from low wage, white East European workers – the ‘Polish plumber’. Of course, the coverage in this book is not just of the UK, and not just of Brexit. But the authors are not just describing how there is opposition to other ethnic groups. While they do not explicitly share these concerns themselves, they go out of their way to say that these are valid. For example:

“Too often the left view this immigration angst solely as a byproduct of objective economic grievances when it is in fact a legitimate concern in its own right and … is rooted in broader subjective worries about loss and relative deprivation.” (p 222)

and, on popular anxiety about immigration and ethnic change:

“While many of these fears are exaggerated – especially in the case of Muslims, who as a group are often damned for the sins of a very small minority of Islamists – we need to appreciate how people feel. Given ongoing immigration and rapidly rising rates of ethnic, cultural and religious change, it seems to us unlikely that these anxieties will fade.”

“It is important to try to engage with their concerns, particularly for those on the centre-left who, to avoid further losses, will need to make short-term concessions. Meeting the demand for tighter borders or modifying the type of immigration … is compatible with progressive politics.” (pp 281-2)

Basing their stand on the evidence from numerous opinion polls, they can correctly dismiss as mistaken the views of the established political parties and of the left that if workers can be given ‘more jobs, more growth and less austerity, then their support will return’. Yet that leads them to argue that policies should be adopted to address and deal with ‘people’s concerns about immigration and rapid ethnic change’ (p 261).

If the authors escape the charge of endorsing racism, they still remain guilty of accepting and working within a framework of nationalistic politics. The irony running throughout this book is that they have set up national populism as a political challenge to liberal democracy and then have taken on board the concerns of the national populists.

Imperial politics

The authors do not ignore capitalism in their analysis, or the wider political trends. They cover quite a lot of ground in a summary historical review of how capitalism has developed, the different forms of politics that emerged in the West that helped to endorse the system in the eyes of the population, and of earlier forms of populism. They also note the different phases of immigration into the US and the UK over the past hundred years or so, and the more recent trends in a wide range of European countries.

I was pleasantly surprised to find some brief mentions of the term ‘social imperialism’, describing how capitalist parties and governments in the late 19th and early 20th century countered the appeal of socialism and attracted support from workers by ‘a combination of welfare measures to help poorer people, such as the introduction of old-age pensions, and the celebration of national greatness and expanding Empire’ (p 228). But this remained only part of their historical review and did not seem to have much implication for their discussion of more contemporary trends.

It would have been more consistent for them to spell out how masses of people in the richer countries remain wedded to the social imperialist outlook. Welfare provision by governments in rich countries has grown far beyond what it was in the early 20th century, and it has been a key pillar of what is effectively a ‘social contract’ between the national working class and the capitalist state. In other words, workers will remain loyal to the capitalist system and the national state, including support in wars, as long as the state provides some basic economic security.

That deal has now been undermined by two important developments. Firstly, the growth of the global market, aside from its dysfunction and destructive tendencies, has also shown for capitalist business that there are cheaper ways to get things produced than depending upon welfare-supported workers in the richer countries. Employment conditions have been undermined by outsourcing, supply chains and worse labour contracts, with only some privileged areas remaining relatively unscathed, in high level engineering, technology and some other monopolistic sectors. Secondly, more stagnant economies over the past decade or so have thrown into sharper relief the accumulation of debts, and state spending deficits in particular. Accentuated by problems of an ageing population in many countries and capitalist pandemics like obesity, welfare provision is under pressure.

But these developments have not led the mass of people in richer countries to realise that the game is up and capitalism no longer works for them. Instead, they have turned towards reactionary politics. This can hardly be much of a surprise, since, as the authors themselves note, there have been longstanding racist and nationalist opinions. Liberal views were often more supported by the social strata that were made comfortable by the system, while the remainder kept relatively quiet as long as things were ticking over for them. Now that the capitalist markets supported by the working class have come back to bite them, they have spoken out.

This is the relevant background to the authors’ focus on ‘hyper ethnic change’. The popular reaction to a rapid influx of immigrants seen over the past few decades, and especially in the past 10-20 years (after 2004 in the case of the EU, following the accession of several new Eastern European members), reflects the worry of the ‘native’ masses about their social and economic welfare. They don’t stop for a moment to consider the many fires that their governments have started in and the destruction they have brought upon countries in the Middle East, Africa and Latin America, nor of the collapse of living standards in many East European countries when they were incorporated into the western capitalist markets.

Culture and privilege

Privileges enjoyed by the mass of people in the rich countries are being taken away, so they blame Mexican or East European workers, Chinese and Asian goods, and they wrap that up in moans about the threat to their ‘way of life’ and culture, especially from the Muslim community. As the authors put it, using apologetic brackets to distance themselves: ‘most national populists see the quest for lower immigration and slower ethnic change as an attempt to stem the dwindling size of their group, to advance its interests and (in their eyes) avoid the destruction of their culture and identity’ (p 162). Let us consider this culture question for a moment.

I do not know whether any of the myriads of opinion polls cited by the authors have ever asked the question of whether Muslims, or other groups considered unwelcome in these polls, are believed to have a stronger sense of community than the anti-immigration respondent. The ‘native’ reaction is to a different group, whether that distinction is made visible by them using a different language, religion or something else. But it raises the question of what they are really protesting about.

‘Native’ working class culture has been disintegrating for the past 40 years or more in many western countries. Even before, it was nothing to brag about, and the latest decline has nothing to do with immigration, ‘hyper’ or otherwise. The protracted crises of the 1970s and 1980s dealt a blow to many traditional industries and forms of employment that were the centre of settled working class communities, from mining to manufacturing, from steel making to shipyards and transport, and the hollowing out of jobs in many areas. There have also been changes in technology and work practices, a reduction of trade union membership and the creation of many new service sector jobs less covered by trade unions. These and other, more recent developments, sometimes labelled the ‘gig economy’, did not come from immigration. Popular sentiment has nevertheless found immigration as something to focus on, since it was never far from a nationalistic and sometimes racist mindset in any case.

What is it about ‘culture and identity’ that popular sentiment wishes to save from ‘destruction’? The population has done little or nothing done to combat the capitalist market trends that have undermined them, and instead it has been absorbed by mass consumer culture. It is only now, when the economic foundations of an acceptable life are being taken away, that the pro-imperialist working class protests. It fights back by demanding that the capitalist state cuts or stops immigration. The authors say that even if more ‘jobs and growth’ were created then ‘tensions over perceived differences in culture and values will remain’ (p 152). But that is because a large section of the working class has chosen to try and defend itself by relying on ‘its’ state to take action against foreigners. The truth is that it is in no position to hold up anything in its own culture worthy of respect.

Political climate

This book gives a systematic overview of contemporary political opinion, especially that underlying the support for national populism. It helps to clarify the depth of the political problems faced by those who do not like what is going on, but the solutions offered by the authors end up endorsing the concerns of the reactionary populists! When the capitalist system is pissing down on everyone from a great height, they join in the argument about the distribution of umbrellas and raincoats, and wonder if immigrants should be given any if that risks the ‘native’ workers going without.

Tony Norfield, 19 December 2018

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[1] The United Nations International Convention on the Elimination of All Forms of Racial Discrimination in 1966, of which Article 1 of the Convention defines racial discrimination as: ‘... any distinction, exclusion, restriction or preference based on race, colour, descent, or national or ethnic origin which has the purpose or effect of nullifying or impairing the recognition, enjoyment or exercise, on an equal footing, of human rights and fundamental freedoms in the political, economic, social, cultural or any other field of public life’.

Some Books

Based on my non-economic readings over the past year or so, here are some books to follow up if you want to find out about …

The British Labour Party

Edmund Dell, A Strange, Eventful History: Democratic Socialism in Britain, Harper Collins, 1999

Written by a Labour right-winger, this book contains a telling critique of the reformism and hypocrisy of the Labour left, plus rarely noted information on how the colonies (and the US) provided the funds with which to set up the welfare state in 1945. Its main message is that the British electorate will not warm to ‘socialism’, so Labour has always had to retreat from radical programmes, even ones that were far from socialistic and which at best could be called national welfarism.

The Partition of India

Narendra Singh Sarila, In the Shadow of the Great Game: the Untold Story of India’s Partition, Harper Collins 2005 and 2009

This is the only book I have found that explains what was in it for the British when India was partitioned. It shows how the British backed Muhammad Ali Jinnah in his opposition to the Indian National Congress, and how they encouraged the formation of Pakistan as a dependent state that they could better rely upon to be anti-Russian than an independent India. Historians usually avoid this and explain partition by claiming that there were deep-rooted ethnic/religious differences that demanded a Moslem Pakistan separate from a Hindu India.

Middle East historical background

James Barr, A Line in the Sand: Britain, France and the Struggle that Shaped the Middle East, Simon and Schuster, 2011

A very interesting account of the carve up of the region between the British and the French, from Iraq to Syria, Lebanon, Palestine and Israel, mainly covering the 1915-49 period. This brings out the hypocrisy and double dealing of the major powers very clearly. For example, it shows how France armed and supported the Zionist opposition to Britain in Palestine as a means of getting back at the Brits for edging them out of Syria.

David Fromkin, A Peace to End All Peace: the Fall of the Ottoman Empire and the Creation of the Modern Middle East, Phoenix Press, 2000

Fromkin has some very good coverage of the machinations of the big powers in the region, from the late 1800s to the 1920s. Although he is pro-Zionist, he provides a lot of useful material on who did what, when and why.

However, neither of these books (nor many others) asks the question of why the Palestinians had to pay the price for the European murder of millions of Jews – in terms of expulsions and seized land in the UN 1948 deal to set up Israel (quite apart from the new state’s later annexations).

Immigration/racism in Britain

Robert Winder, Bloody Foreigners: the Story of Immigration to Britain, Abacus Books, 2004 and 2005

This covers a long history from the 1200s (!), but very well, and with interesting insights into popular prejudice and political responses, giving many striking examples. The 20th century takes up most of the book, and is most relevant for contemporary politics.

Africa and nationalism

Basil Davidson, The Black Man’s Burden: Africa and the Curse of the Nation State, James Currey, 1992

This is the best thing I have read on the problem of nationalism, and why Africa is such a mess. Davidson shows how the efforts of post-colonial governments in Africa to adopt a national perspective, largely adopted from Europe, could not work. This perspective did not suit the realities on the ground, where there were all kinds of cross-border relationships and also divergences within supposedly unified nations. Davidson puts this in a materialist perspective, showing how the up and coming African bourgeoisie was still very weak, and in the 20th century could not replicate what the Europeans did in the 19th in terms of building nation states. This was a clear sign of the limits on development created by the imperialist world economy, both in colonial times and today.

Tony Norfield, 29 December 2016

Corbyn’s National Welfarism

In the days, even weeks, leading up to Remembrance Sunday on 13 November, all public figures in the UK must wear a poppy. This is not actually obligatory; it is just the way things are done. Some 45 million poppies were attached to clothing this year, a total that far outweighs the number of celebrities. If you are not seen wearing one, then perhaps you forgot, perhaps it is on a different jacket, perhaps your mum or dad did not buy you one and your pocket money was insufficient, perhaps you are a household pet, or, heaven forbid, you might have some questions about this totem for honouring/remembering the war dead in their sacrifices for ‘Britain’, otherwise known as British imperialism. Just to make sure he was not numbered among the latter persona non grata, Labour Party leader Jeremy Corbyn made sure that he was wearing a poppy when he appeared on the BBC’s Andrew Marr show that day.[1] To reinforce his patriotic credentials, Corbyn also made sure to note that he would be standing at the Cenotaph later on Remembrance Day with a 92-year old friend, a Labour party supporter and veteran of World War Two. Thus began his exposition of how Labour’s policies would meet the demands of the UK electorate.

The interview with Andrew Marr covered lots of questions. Corbyn came out clearly against racism, responding to recent political developments in the US and Europe. In the aftermath of the UK’s Brexit vote, he also stressed the importance of keeping its access to the EU single market and the provisions for workers’ rights existing in the EU. But my main focus here is on how Corbyn’s comments illustrated a common feature of leftwing views in many rich countries, national welfarism.

National welfarism

National welfarism is somewhat different from simple nationalism, which can be summed up as demanding that government policies should benefit the people of a particular country (usually meaning the corporations). Instead, national welfarism cloaks a nationalist policy in progressive phrases and proclaims the need to protect the common people from the depredations of the market. In all cases, national welfarism amounts to a call for the capitalist state to implement such policies, not for a struggle of people to protect themselves from such depredation. Furthermore, it avoids naming names. Rather than singling out capitalism as the problem, and the capitalist state as the enemy’s enforcer, it is a demand for different government policies. It is the stance taken by those who do not like capitalism’s impact on people’s lives, but who do not want to make a fuss about opposing capitalism. One might think this is just letting discretion be the better part of valour, but it is more than that. It is a facile belief that good bits of capitalism can be salvaged from the bad bits of capitalism.

Worse than this, national welfarism pays no attention to whether the state in question is one of the major powers in the world that spends its time oppressing others, either directly, or indirectly in making sure that the general system of oppression and privilege for the major powers remains in place. The reason is that this oppression by their own powerful state is something from which, implicitly at least, the national welfarists would like to benefit.

Answering the questions

Andrew Marr, a pillar of the BBC’s establishment opinion making elite, asked some pertinent questions. Corbyn answered clearly.

Why has there been a political shift to the right in many (rich) countries, and why has the left failed to channel popular anger? Corbyn thought that the previous New Labour agenda was mistaken and could not meet popular concerns, because it ignored the deindustrialisation of Britain and focused on globalisation. This was how he introduced his alternative Labour Party policy.

While Trump in the US and Marine Le Pen in France were in favour of trade protectionism, to stem the loss of domestic jobs, Corbyn countered with the view that there should be new investment in industry and ‘fair trade agreements’. He did not openly endorse tariffs and protectionism, but was very open to other forms of trade control – to make it ‘fair’, of course – which would go back to the Labour left and British Communist Party ‘alternative economic strategy’ programmes of the 1970s and 1980s. In this, he ends up posing foreign countries as the barrier to economic welfare for the Brits, not the market system, and still less capitalism. So the capitalist state should take measures against those who are not playing by the rules that the major powers, such as Britain, have introduced. Environmental concerns were also used to bolster his position. This is the common fashion among radicals these days – and is essentially a dig at China, in line with major power policy – despite the fact that the major powers have done by far the most to destroy the global environment.

Corbyn later criticised Donald Trump for demonising foreign workers, but, despite his anti-racism, he still managed to point to migrant labour as a problem for British workers. Even from his own perspective, he could have more simply said that migrant labour is not the problem, it is the capitalist labour market, and that he would demand the same conditions for all workers, whether migrant or not.

Immigration and UK politics

It was on the explosive popular issue of immigration that Corbyn was most evasive. He posed regional investment as a solution! The implicit logic was that if the state could encourage investment in those areas that were most anti-immigrant (basically, in England, and probably also in Wales), then such sentiment would fade away. This stepped aside from the post-Brexit issue of who is meant to benefit from the national investment policy, while his statement would, of course, be taken as meaning the ‘national’ working class. When asked about whether he agreed with the view of Keir Starmer, Corbyn’s Shadow Secretary of State for Exiting the European Union, who has argued that immigration should be lower, Corbyn said:

‘I think it [immigration] will be lower if we deal with the issues of wage undercutting, deal with exploitation, but we should also recognise that the migrants that have come to this country work and contribute, and pay taxes, and the NHS would simply not survive without the level of migrant labour, doctors, etc, because we have not invested enough in high skills in our own economy.’

So, migrants are justified on the basis of their economic contribution, but there is also the hope that training domestic workers, and enforcing higher wages, will cut immigrant job applications! This is the national welfarist’s solution to the anti-immigration outlook of his electorate. Just in case you thought that Corbyn was ignoring the demand from a sizeable chunk of that electorate for immigration to be checked, even reversed, he wants to stress that his policies will help do just that.

In a final, summary comment, Corbyn makes the broader points that his economic policy is for ‘left behind, broken Britain, poverty Britain’, one that will oppose the Conservative government’s policies on the National Health Service, etc, and appeal to the electorate that there really is an alternative that the Labour Party under Corbyn can implement. But there’s the rub. How to reconcile the predatory demands of capitalism and imperialism with the social welfare outlook of the reformer, while not giving too much ground to popular reactionary nationalism that the middle class, for now, still finds unacceptable?

Tony Norfield, 16 November 2016

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[1] Corbyn’s interview with Andrew Marr starts around the 16-minute mark in this video.

Value of Labour-Power, Wages, Productivity and Imperialism

These are notes from, and for, a series of discussions on imperialism organised by Redline. (See here for other details) As such, they are not a fully rounded analysis, just some guidance on points in these debates.

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A key point to note is that the discussion of these topics often mixes up the question of the value of labour-power and that of (the rate of) exploitation. Both are affected by social productivity – how much can be produced in an hour – but are different aspects of labour’s employment by capital.

For example, assume that the value of labour-power, represented by the wage, is the same everywhere. Then the rate of exploitation – how much surplus-value compared to the value of labour-power – is higher if some workers work more hours at the average level of productivity. Even with the same number of hours worked, the rate of exploitation would be higher where workers are more productive per hour than average – usually meaning they are working more intensively, or have better technology or have higher skills. One hour of productive social labour under capitalism produces the same amount of value as another only if it is of the same productivity, intensity, etc.[1]

Of course, the value of labour-power is not the same everywhere, so that adds another variable to how exploitation is calculated. If the value of labour-power is much lower in some countries than others, exploitation might be more, but it might also be less, depending upon hours worked, intensity, productivity, etc. Nevertheless, these are abstract points of theory; the reality of the world economy paints a much more straightforward picture.

1. Wages, value of labour-power

Everybody knows that there are huge disparities in living standards worldwide. Equally, every capitalist company knows that workers in one country may get wages that are a small fraction of those in another country. Recent data from the US Conference Board for 2012-13 show that manufacturing hourly compensation costs (ie wages plus various directly-paid benefits) in China and India were 11.3% and 4.5%, respectively, of the US level, despite a previous increase, especially in China. So, if the US worker got $25 per hour, the Chinese worker got under $3 per hour and the Indian worker still less. In the rich European countries, by contrast, compensation levels were generally above those in the US, although for the UK they were 20% lower, at nearly $21 per hour.

Whether one allows for the impact of exchange rates, local costs, or anything else, it remains the case that a large proportion of the world’s proletariat is living in penury compared to those in the rich countries. The disparity is so huge that, even with so-called globalisation in recent decades, there has clearly been no ‘equalisation’ of wages in the world market, nor really any significant narrowing of differentials. For this reason, it would be wrong to argue that there is an equal value of labour-power everywhere, so that if one group of workers gets paid below this, then they are getting paid below ‘the’ value of labour-power. Instead, it makes much more sense to argue that there are different values of labour-power in different countries, for a variety of historical, political and social reasons.

Taking absolute levels of wages (basically, their purchasing power, or real wages), moves towards an equalisation could potentially occur, but only if there were a free market in labour-power. However, from the late 19th century, when travel became less costly, there was also the growth of passport laws and immigration controls in the richer countries. Governments implemented these not only due to concerns about ‘undesirable aliens’. More importantly, labour unions and workers in the richer countries protested about the pressures on the labour market for lower wages from these migrants and the extra demand for housing, etc.

Such controls have remained in place, in different forms, since then. Where they have been relaxed, as with the EU membership of Eastern European countries from 2004, this has caused political trouble, as witnessed in the latest UK Brexit vote. The ‘exit’ voters (mostly in England and Wales) were those who felt they had suffered from an influx of cheaper ‘Polish plumbers’, etc, who had done them out of jobs, made housing more expensive or less available, and made the queues for medical services and welfare payments longer. Similarly, in the US we have the ‘Trump wall’ proposals to keep out the Mexicans, etc. These political moves, contradicting the usual capitalist search for the lowest labour costs, are responses of the ruling class to the economic discontent of a loyalist, pro-imperialist working class that is demanding protection from its state.

From a Marxist perspective, wages are based on the reproduction costs of labour-power, or what capitalists need to pay workers to get them to be able to show up for work (not just individually, but also to allow for family costs, etc). This, in turn, depends on subsistence costs as a minimum, plus what Marx called a ‘historical and moral element’. This latter element is based on the social conditions prevailing, including the success or otherwise of working class struggle for higher wages, benefits, etc.

This also means that there is not necessarily any direct relationship of wages to productivity. It is true that higher productivity can allow the capitalist to make some concessions on wages and benefits while still making a profit. Equally, low productivity means the capitalist will have to impose harsh conditions in order to survive in competition. However, there is no one-to-one relationship. It depends on the political and social situation. A defeat of the working class can lead to high levels of exploitation and high productivity, but low wages. This was true for the West German ‘economic miracle’ in the 1950s, for example, where exploitation of the working class was comparable to that under Hitler.

In periods of crisis-free growth, it is likely that wages will rise, but commonly we find that wages grow less than productivity. The degree to which that happens is not predetermined. Rising productivity is usually an indication of a rise in the rate of exploitation, despite what may also be improved living standards (higher real wages) for workers. However, this mechanism does not work in the same way for workers in the dominating, imperialist countries and for those in a more subordinate position.

In the imperialist countries, the capitalist class may attack living standards, but it has far less freedom to do so than in the dominated countries. In the latter, it is also starting from a lower level of living standards from which to begin exploitation. In this case, the ‘historical and moral elements’ work in capital’s interests. Especially for countries that are newer entrants to the global economy, the more traditional social relationships can substitute for higher wages paid by the capitalist (eg workers from the countryside working in factories but still growing some of their own food). Wages will be very much lower than in the major countries, even if productivity in the factory is not that much lower, or may even be higher, than in the more developed economies.

2. Productivity

A few points on productivity measures in commonly used economic statistics, and the differences between imperialist and dominated countries, are also worth bearing in mind.

The national average productivity level in dominated countries may be low, since it will often include a large subsistence-based agriculture or commercial sector and small-scale producers. This can lead economists to argue that differences in wages are a function of differences in productivity (on their assumption that workers get rewarded according to the value of what they produce – something at odds with a Marxist understanding). But this economist argument conveniently ignores that foreign companies from imperialist countries invest in, or are supplied by, companies in sectors of the economy where levels of productivity that are not materially different from those in the major countries.

Foxconn, for example, has greatly mechanised its massive production facilities in China with a huge number of industrial robots. This highlights how the massive gap between wage levels paid in China, India, etc, and the wage levels paid at home is a sign of extra exploitation, in the sense of value produced versus the value of the wage paid. In other words, it is a higher rate of exploitation (s/v) by these companies in India/China, etc, not a sign that they pay low wages because productivity is low.

I think a key point of John Smith’s Imperialism book is to show how GDP-related statistics mean that measures of value ‘production’ are implausibly distorted in favour of the rich countries. With their commercial (and more general) market power, they are able to force a deal upon the producers of the oppressed countries, although this shows up as value accruing in their own domestic economies. This is why Apple Inc, a US company, looks so profitable, despite producing little or nothing in the US.

3. Profitability, rate of profit

Differences in national rates of exploitation may not be the reason or the only reason for the different measured rates of profit. Tax concessions for foreign capital, or other concessionary deals to attract foreign capital can also be important. Equally, cheaper land or other available resources can also help boost profits, separately from whatever wages might be paid.

This raises the question of why ‘all’ capitalist investment does not migrate to the more profitable location, or why it has not all moved to China, etc. John Smith has made some useful points here, both that a lot of the productive capacity has done this – as shown in some details of FDI that distinguish HQs and more marketing-type facilities from production facilities – and that there has been a distinction in the product markets between more high-tech and low-tech operations. The former are in one ‘market’, that run by the major powers making aerospace products, top-end engineering products, etc, with patents and other barriers to entry from competitors. The latter is a separate market making textiles, clothing, simpler components for other products, where competition is fierce.

I would add that there is also an extra ‘value’ given by design patents and intellectual property, plus marketing power. More or less all of this economic benefit accrues to the companies based in the imperialist countries. This is a form of monopolistic control of markets, boosted by the greater buying power of rich consumers – in this respect it is a feature of monopoly control that is self-reinforcing. One interesting angle on this is given by the ‘Smiling Curve of Stan Shih’, where Shih, a former Acer executive, notes that the worst thing to do if you want to make any money is to produce the goods, rather than designing or selling them!

This harks back to British imperialism’s heyday, when Britain was more of a commercial and financial operator than a producer. If anything, the pattern of the world economy today, with the power of Google, Facebook, Amazon, etc, shows that profitability has little to do with producing any value. Don’t be an idiot, get others to do the hard work producing!

Such developments also cast questions on an equalisation of profit rates internationally, as measured by country-based rate of profit measures. Yes, companies will tend to focus on where more profit can be made. But how do they do this, and does this mean they change location? This is one more sign that Marx’s analysis, and even Lenin’s, is only a starting point for analysing imperialism today.

4. Productivity, C/V, rate of profit, imperialism

Higher productivity means producing more use-values with less of an input of value, ie less value (social labour-time) per unit of commodity produced. Usually, and historically, this comes about through mechanisation. But there can be path-breaking innovations that use up far less resources (constant and variable capital) per unit of output (for example, in telecoms, containerisation) and might even involve much less cost of constant capital. So, there is a very common, but not always a necessary link between a higher C/V and higher productivity.

The point I would stress, however, is that in much historical work on imperialism there is a mistaken view that the basic mechanism of exploitation/value transfer is where higher C/V countries (presumably, the more developed) extract value from lower C/V countries (the less developed). This derives from the process Marx describes for an equalisation of profit rates in the capitalist market, ie that there is a flow of value (based upon prices of production differing from values) from the low C/V companies to the high C/V companies.

The problem is that this has nothing to do with imperialism as something special in a new phase of capitalism! It is a normal feature of the capitalist market, even within an imperialist country. The economic analysis of imperialism has nothing to do with this aspect. Instead, the economic content of imperialism should show how the more powerful countries exert economic power over the oppressed. Furthermore, this is how a monopolistic market run by the major countries tries to prevent whatever free-market equalisation is meant to occur, whether this is of profitability – to protect their interests – or even of wage levels, to keep their populations onside, when it comes to imperial conflict!

5. Conclusion: the benefits of imperialism

In economic terms, imperialism benefits not only the imperialist governments and corporations, but also the mass of the populations in the powerful countries. This comes through concessions that the former are able to give to the latter, whether in welfare payments or in wages directly. In the major countries, even when wages and working conditions are under pressure, or when unemployment is rising, there remains a clear distinction between the living standards and the state-sponsored social safety net available to workers in rich countries and what workers in poor countries receive. These privileges are an important material basis for the political outlook of the mass of workers in the rich countries.

Tony Norfield, 30 July 2016

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[1] Also note that whether value is created is socially determined. For example, if too much is produced of a particular product, then part of the social labour allocated to its production is worthless. This will be reflected in unsold commodities and/or falling prices.

BREXIT, the City and British Politics

I was interviewed by the Argentine magazine Ideas de Izquierda about BREXIT, the City and British politics last week. The interview will be published on their Spanish language website in a few days, and the English version is available now on the website Left Voice.

Tony Norfield, 9 July 2016

Imperialism and Social Democracy

This item is a response to comments made by 'Anonymous' on two of my blog articles earlier this month: Immigration and the Imperial Mentality, with a comment on 24 April, and The Dead Sea, with a comment on 27 April. I would prefer that people who comment use a name, but let that be. I would also prefer that the comments or questions had more substance, rather than simply recycling prejudices. But, since the prejudices raised are commonly held, I feel inclined to answer them, rather than to think they are from an Internet troll or a calculated wind up from someone who knew that they would make my blood boil.

I have reproduced each of the main comments in bold below, and then answered the points raised in the text below each one. My replies are brief, partly because I have other things to do and partly because the ill thought out nature of the comments does not deserve a more extensive response. The views of Anonymous reek of imperial prejudice. However, it is not the confident prejudice of the British establishment, but the no less sickening hypocrisy and prejudice of the British ‘labour movement᾿.

The latter is cloaked in a concern for the mass of people, but is really an assertion of the rights of imperialist country workers over those elsewhere. Notably, the comments from Anonymous have been raised on the question of immigration. The answer to this question determines whether you are on the side of the working class internationally, or whether you want special privileges for your ‘own’ working class, ones that you think will come from calling on ‘your’ state to implement the correct policies. This is the core of the argument presented by Anonymous, covered with the stinking slime of ‘Europe’ and ‘Western values’.

So, to begin …

1. “Should Europeans commit the last of their pension money, destroy their social democracy, extirpate their cultures, genetic identity, etc., to facilitate invasion of their countries? Would mass-suicide be a proper move, speeding the process up a few years?” 27 April 2015

a) Pension money. This comes from money invested in financial securities, usually with a return based on income gained from equities and bonds, but perhaps also from property, commodities, etc. This money is not simply workers’ and others’ savings, but savings that are directed into funds that earn revenues from worldwide investments, particularly in the funds run by the major powers. So, pension payments are based on the profits produced worldwide, rather than simply being a means of saving for retirement. Note also that many poor countries do not pay any pensions of significance, while most rich country pension funds have payment liabilities that greatly exceed the expected returns on their assets.

b) Social democracy. This is a form of politics that originated in Western Europe from the late 19th century, one that tried to reconcile the newly enfranchised working class masses with the capitalist system. It offered social reform as a palliative to the exigencies of the capitalist market that drove many into poverty. Particularly in Germany before 1914, it also offered a gradual, reform-based road to socialism, but everywhere it supported the state’s war on other states, mass slaughter and the oppression of Europe’s colonies. No political movement in the West today could in any sense be called social democratic; the mainstream parties all accept capitalism as a permanent fact of life. It is appropriate that even radical ones adopt ‘Keynesian’ views of managing the economy, as Keynes himself wanted to save capitalism.

c) Cultures. Europe? Personally, I prefer Indian and Middle Eastern mathematics to Roman numerals, and jazz and other forms of music (from Africa and the Caribbean) to Classical music. I really do not like Morris dancing. Everyone to his or her own taste.

d) Genetic identity. You should check this out more. Scientific evidence would suggest that everybody comes from Africa. In any case, what has genetics got to do with the development of society, which in its main forms has developed in the past ten thousand years?

e) Invasion of countries. This is a preposterous exaggeration of the scale of immigration. You would also do better to study European military invasions in the Americas, Africa and Asia to find real examples of how to ‘extirpate’ cultures.

f) Suicide. Everyone must make his or her own decision whether life is worth living. More important is the decision whether to try and understand what drives the world, rather than accepting first impressions or whatever the political climate imposes.

2. “Do you know how much wage suppression causes, extending capitalism by keeping profits at that sweet 12 percent/year it demands? Do you know how the accelerated the destruction of social services are, a combination of right-wing cuts and over extension from millions of illiterate, intolerant peasants? Do you know the hundreds of millions in remittances the immigrants send home, further eroding the domestic economy in an age of austerity?” 27 April 2015

a) Wage suppression. It is a mystery where you get your 12% (rate of) profit. In any case, there is always an attempt by capitalist employers to keep wages low. How have ‘millions of illiterate, intolerant peasants’ contributed to this? You also ignore the role of trade unions in colluding with management to split the workforce into insiders and outsiders, the latter being part-time, temporary workers, etc.

b) Destruction of social services. There has been little cut back in social services spending, at least so far in the UK. There will be significant cuts in future, and these are attempts by the ruling class to restore profitability, the lack of which has undermined the revenues from which these unproductive (for capitalism) expenditures can be funded. However, you want to blame immigration for putting pressure on social services, rather than capitalism for being increasingly unable to provide decent living standards. As for ‘right-wing cuts’, you ignore the role of the previous Labour Government in backing privatisation, school academies, etc. In any case, this raises a point about the origin of the social services. If you look, you will find that the 1945'ish origin was (i) promoted by the Liberals (Beveridge) and (ii) was planned under the subsequent Labour Government as being funded by exploitation of Britain's colonies. This was part of a ‘social contract’ between the British ruling class and the mass of people: in return for mass support for British imperialism, the state delivered some social welfare. The economics behind that game is over. But you moan about not getting your goods, while still clinging loyally to the capitalist state. The term reactionary fool comes to mind.

c) Illiterate, intolerant peasants. Is it so hard to meet the relatives of those who made the shirt you are wearing? Those who are more than 10 years behind our elevated standards on women’s rights? Those who often have a stronger sense of community than the British? Your European culture has been fuelled by the blood and oppression of countries that are the source of your fearsome peasants.

d) Remittances. Yes, I do know the scale of remittances. It is very small indeed compared to the other items in the balance of payments, on imports, exports, etc. Notably, you are more nationalist-minded, not to say racist, in these calculations than British and other national capitalists, who also take into account the benefits they get from the supply of cheap labour from immigrants. For example, since the 1950s, low-paid immigrants have increasingly staffed the NHS. Presumably, you would be opposed to higher wages in such jobs because that would only increase the remittances these foreigners could make. That would be consistent with your choice of nation before class.

3. “Have you ever traveled? If so, you know full well not one non-Western country is importing workers, much less to the point of total destruction of the home culture by ones that do not believe in tolerance or left politics.” 24 April 2015

a) Have you ever travelled? Yes.

b) Not one non-Western country is importing workers. Migration is affected by many things, wars, social disruption, natural disasters, people seeking a better life or job elsewhere. Countries have many different ways in which they regulate immigration, naturalisation of immigrants as citizens, etc. While economics is a key driver of migrant flows, with poorer people usually moving, or attempting to move, to richer countries, it is not a one-way street. It is simply wrong to say that non-Western (meaning poorer) countries do not import workers. There are about six million migrants from other countries in India. Brazil even has co-official languages (usually Italian or German) in cities where there is a large proportion of immigrants.

c) Total destruction of home culture, tolerance and left politics. I cannot tell you how much I miss bread and dripping, a day at the dogtrack, breeding pigeons, colour bars on jobs and housing and racist chanting at football matches, because I don't miss them. Tolerance is a function of relative comfort. ‘Left politics’ has been moribund for decades in rich countries, not least the UK. It tried to connect with the pro-imperial mentality of the masses in rich countries and was always delusional, relying on the state.

4. “There's nothing in Marxism that demands obliteration of one culture by importing unlimited amounts from another culture to offer a one-off wage suppression.” 24 April 2015

There is nothing in Marxism that calls upon the state to defend the privileges of one group of workers at the expense of another.

Tony Norfield, 29 April 2015