30/06/2020 - Self-reliance and the need for economic restructuring

glennicklassonSolidarity President Glen Nicklasson (pictured) writes

There is little doubt Britain was not prepared for the impact of Covid-19 and the effect it would have upon workers and the general populace across our country. There is also little doubt the economy will suffer because of this, with the likelihood of a depression far worse than the financial crisis of 2007 leading to job losses and bankruptcies. Some argue the government had weeks to prepare for the impact of Covid-19 as it spread across Asia and Europe, and this is certainly the case as far greater steps could have been taken. However, our economic structure had been damaged beyond repair before this as successive governments jumped aboard the globalisation bandwagon, shrinking our manufacturing base resulting in redundancies as businesses closed or relocated to lands where labour was much cheaper. This may have made sense to the bosses and shareholders as their profits increased, but it resulted in hardship for workers back in dear old blighty. It also resulted in the country becoming reliant upon overseas imports for vital equipment as Covid-19 headed to our shores.

International trade has always existed from the times the Romans landed in Britain. It is not a recent phenomenon. Globalisation, or as some refer to it neo-liberalism, is. The pandemic which is Covid-19 has tested this economic philosophy and it has failed miserably resulting in shortages as Britain was not in a position to produce the vital and in many circumstances basic equipment, the country needed. This is exactly why when we hopefully turn the tide on this pandemic there has to be massive economic changes within Britain where we can build a largely self-reliant economic structure which in turn will protect and create jobs and long term secure employment.

Self-reliance in the simplest terms is the ability to depend on your own means to get things done and to meet your own needs. Britain today is a million miles from this both in terms of manufacturing and workers relied upon to fill positions essential to the economy. However, we were not always in this position, and even as recent as the 1970’s Britain produced equipment and goods which the country depended upon. A labour market existed which provided workers that filled many positions which are now taken by economic migrants. The words ‘Made in China’ or ‘Made in Taiwan’ still appeared on some products (as international trade still existed as previously mentioned), but the words ‘Made in England’ or ‘Made in Britain’ appeared on far many more as we were not dependent upon imported goods. Likewise, horticulture and agriculture were not dependent upon migrant labour, as housewives, students, and others took on seasonal work. The advent of Thatcherism and her monetarist policies laid the path for globalisation and the eventual destruction of an economy which was bordering on self-reliant, and which would have been able to meet the country’s needs if confronted with the situation we face today with Covid-19.

The priority must be put Britain back on a path of a largely self-reliant economy which can protect as well as create jobs and one that is capable to withstand a global crisis. There has to be an initiative where industry is examined and a structure implemented whereby we look upon what we import and where we can successfully manufacture products ourselves, moving us away from dependency on others to a capability of self-reliance. The people must no longer be at the whim of multi-nationals who look upon workers as pawns who can be sacrificed in the quest for increased profits. A new economy must be built which creates vibrant third sector businesses such as co-operatives and stakeholder businesses in which workers are valued and have a real say. An economy built to such a basis can be successful, and we have only to look to the Emilia-Romagna region of Italy, where around 35% of regional GDP is generated by co-operatives. To generate such an economy a stable interest-free money supply has to be created, giving new ventures and existing industries the foundations to build and grow. This could come about through the creation of either a National Bank or regional banks. At the same time, we must secure businesses in this country, both for the need for self-reliance and to protect jobs. The national government should be prepared to buy a golden share in industries to keep them afloat. If this had been policy, Britain would still have had a major car industry of its own today instead of one owned by companies such as BMW. We must also stem the tide of globalisation to prevent job losses and businesses relocating to countries where labour is cheaper. Britain needs its businesses and workers need businesses to provide employment. At present there is little to prevent any business from uprooting and going abroad, closing its premises and making its workforce redundant. It is not a process that fits in with any program of self-reliance. Steps have to be taken whereby if a business owner decides to relocate, the workforce has an opportunity to take over that business, thus securing jobs and a cog in the economic framework of this country. Once more the need for a national/regional bank is key to this.

The other area that requires looking into is import tariffs. We currently import many goods from countries which have little regard for human and animal welfare. Countries where workers often receive a pittance for their labours, work in conditions where there is little regard for health and safety and where there is an abuse of child labour. Yet currently there is a level playing field, where goods can still be imported from these countries under the same tariffs as those who have decent standards of human and animal welfare and where workers do not face conditions which often put their lives at risk both in the short term and the long term. Again, this imbalance is a matter that needs addressing.

But what of workers’ rights in this country? These were initially savaged by the Thatcher regime, not reversed by New Labour, and continued under the coalition. To create a truly fair self-reliant economy, workers must be valued and these changes to employment and trade union legislation, some of which were quite draconian, need to be reviewed and where necessary reversed. During the Covid-19 crisis we have seen the value of frontline workers, such as cleaners, shopworkers, those involved in horticulture, refuse collectors, as well as the NHS and others. Many are those that Thatcher and her successors deemed to be low skilled and not worthy of decent wages. Yet the crisis showed the true value of these workers and how we depend upon them. Wages across the whole spectrum need to be investigated through a panel of government, business, and trade union officials, the result being a living income for all. The role of trade unions as part of this process is vitally important. We have seen unscrupulous acts by both governments and big businesses in the past when left to their own devices, therefore we must learn from this by having those that represent workers' interests at the table. such incomes, businesses will not be able to undercut the wages of employees by taking on those who will work for less or keep incomes low. Along with the respect for all workers which Thatcher sadly helped diminish, it would provide a real incentive for a labour market of people in Britain, instead of the reliance on migrant labour in some industries, thus helping us to return to self-reliance in employment.

Finally, we must not ignore Brexit, something which places Britain on a crossroads, but something which could lead to greater self-reliance. At this crossroads, we cannot take the turning which will see Brexit usher in an era where there is a further erosion of workers’ rights, where health and safety regulations are lifted and where Britain becomes a land of cheaper labour to make it competitive in the world of neoliberal economics. In addition to this, (and going back to the present crisis) we must not permit workers, especially those on lower incomes, to have to pay the price through substantial increases in taxation and a freeze on wages to pay for the vast cost that will follow the Covid-19 pandemic. The opportunity of Brexit is to build a self-reliant economy, with an industrial heart providing most of the country’s needs and where the people are provided with the means to obtain their needs. In simple terms sufficient money in their pockets to buy a greater range of British products, supporting the British industry and in doing so British industry supporting them. One huge economic cog that will keep the wheels of Britain turning.

Self-reliance would bring about a mass restructuring of industry to meet the country’s needs. Should Britain ever be faced with another crisis such as the tragic Covid-19 pandemic, it would mean us having the economic capacity to cope and far more lives would be saved. We have to learn from the mistakes of our past, and whilst we may never reach full self-reliance, we can and must get as close to this as possible.