Capitalists will try every trick to derail a Labour government. Sarah Bates argues it will take mass resistance and strong counter-measures to give them a run for their money
Part 2 - Limit
Trade union leaders agreed to “voluntarily’ limit their pay demands. The TUC union federation successfully enforced this “wage restraint”, with the number of strike days falling from 23 million in 1972 to 3 million in 1976.
Unemployment rose and wages fell. The IMF’s loan conditions and devaluing of the pound pulled Wilson’s government to the right. So the leadership went from promising to “get rid of every fucking grammar school in the country” to making cuts in the NHS budgets.
Socialist journalist Paul Foot later commented wrote that, “It was demonstrably true that it failed by a huge margin to shift the balance of power towards working people”.
Employment secretary Michael Foot told the 1975 Labour conference, “We face an economic typhoon of unparalleled ferocity and we cannot run away from it.”
It’s common to compare financial markets to natural seasonal occurrences, like a weather forecast. But economic decisions are not random—they are made by the ruling class. The bosses and bankers will unscrupulously use their economic power to exert political influence. McDonnell’s recent comments highlight an important dynamic in the capitalist system.
Bankers and others who have a stake in the status quo do not sit back passively if they feel their interests are threatened.
This discussion about a run on the pound shines a light on the type of system we live in. McDonnell spoke about “capital flight”, which is where investors take their money to other markets they feel are safer for their profits.