Scotch Myth

Vince Mills

THERE HAVE BEEN SO MANY LIES BY NEW LABOUR THAT IT MAY SEEM A LITTLE CHOOSY TO PICK OUT JUST ONE OF THEM FOR CONSIDERATION. And this one, believe it or not, is not about the War.

I am referring of course to the supposed miracle economy of the Blair/Brown years. So widespread is the belief in Brown's economic competence that it is shared right across the political spectrum of the labour movement, from right to left.

Well, who can deny it? Unemployment is down. There are more people in the jobs market. How can this be anything other than success?
To paraphrase Max Bygraves: let me tell you a story. I was talking to a successful Scottish businessman who is part of a conglomerate which, among things, owns a packaging plant but has a manufacturing capacity. His company had developed a product which is important in increasing the effectiveness of extracting oil in a less environmentally damaging way. I asked if his company would be manufacturing it. No, he told me. They would sell it under licence to US partners and take a share in the profits the US company created. That required little investment but brought high returns.

I asked about Scottish jobs. He told me that as far as jobs were concerned the real expansion in his company was in packaging. The Chinese were exporting televisions and it cost too much to box them in China because it put up the shipping fees. Instead his company boxed the TVs on arrival in Scotland and sent them on to retail outlets in the UK. It was, he told me, how jobs market was likely to develop in Scotland.

In other words, what we have seen in Scotland is not self sustaining growth; we have been witnessing the transformation of a highly skilled, high value added manufacturing base to a low skilled, low value added and largely service orientated economy. It is also highly dependent. It is worth noting how vulnerable service sector economies are to global recessions. Think of our packaging workers if the Chinese stop manufacturing TVs.
This has been the price of running our economy in accordance with neo-liberal principles where tbe state's capacity to intervene has been deliberately curtailed by supra national institutions like the European Union, and the World Trade Organisation. From global capital's perspective it is of course entirely consistent with its desire to locate wherever labour is cheapest or buy up whatever assets -public or private -without state interference.

Nor have we reached the end of this process in Scotland. Far from it. The Futureskills labour market projections for Scotland show that in manufacturing and agriculture jobs will continue to disappear and that in future the service sector will dominate. Between 2003 and 2008 we can expect job losses in agriculture, mining, food, drink and tobacco, textiles and clothing, chemicals, metal, engineering and construction but growth in retail and distribution, hotels and catering, banking and insurance, business services and health and education. Of course whether the jobs in the last sector mentioned will be private or public is debatable.

There's something else worth mentioning here. Much is made by apologists for the New labour putchists currently in control of the Party, that the new economy will be knowledge based. It is an aspiration summed up in the Scottish Executive's Smart Successful Scotland strategy. Hardly surprising that it is repeated in the Futureskills document I have just quoted, since Futureskills is funded by Scottish Enterprise, the economic wing of the provisional labour leadership. However, that same document tells a different story when you look at what it has to say about the need for qualifications in the future jobs market.

They produce an interesting statistic on projected job openings requiring new employees by level of qualification. The total of such jobs is 500,000. Over 60% of those will require from no qualification whatsoever to a Scottish Vocational Qualification level three, which although it is hard to be precise, is roughly equivalent to an HNC at most. The rest will require Scottish Vocational Qualification level 4 or more. Again a level 4 is hard to define: it includes sub-degree as well as degree level qualifications.

o summarise the story so far, then, the much vaunted economic revolution has been little more than a Nero-like fiddle over the destruction of skills and knowledge in return for a vast increase in low skilled and low paid jobs. Well, you might argue at least there has been a growth in jobs. Once again this increase disguises more than it reveals. All of the growth in employment since 1981 has been in part-time jobs and self employment. This may help explain that other great mystery of prosperous Scotland. There are 2.5 million jobs in Scotland but only 2.4 million people in work. Likely explanation? Such is the poor rate of pay many are in two jobs.

It is not enough, as Marx would have it, to merely analyse the current dreadful state of the Scottish economy, or even expose the myths about its success. The point is to change it.

This is by no means easy. The Thatcherite years which embedded myths of the supremacy of the market and the ineffectiveness of social ownership were bad enough, but these have now been reinforced by Blair's term in office, described by John Gray as: '...the long fag end of Thatcherism. When he quits Downing Street he will leave Britain much as he found it.'

The key is surely to begin to rehabilitate the notion of democratic control of the economy. And while this does not mean a return to Morrisonian nationalisation, nor does it mean accepting the argument of the neo-liberals, that the state has no role in protecting and owning public assets, especially those so close to the heart of an effective economy that to surrender ownership of them is to surrender control of the nation's economy. I am thinking, for example, of transport, energy, health and education. Some of these are already in the private sector or are threatened by the private ownership and will be even more vulnerable should Gordon Brown's or Tony Blair's vision of Europe be accepted.

In a recent FT article Brown argues that, "because global trade and investment are central to future prosperity; we need greater external openness... The new protectionism we are seeing, however well intentioned, is a wake-up call because it is the last stand from those who believe we can stop the clock, postpone or prevent inevitable change... Europe can only succeed by moving up the value-added chain. When we equip people for the future, investing in new skills, flexibility and greater fairness go hand in hand. An old European social model that leaves 20m people unemployed is neither efficient nor fair." Brown's solution is to call for greater labour market flexibility and less regulation. This
is of course identical to the 'vision' of Europe offered by Blair.

And it was precisely this smoke screen that New Labour used to disguise a massive re-structuring of the British economy. New Labour have given us what Capital wanted: millions of jobs that are insecure, low skilled and low waged, and an economy which is debt fuelled. And this they have declared an economic miracle. A million manufacturing jobs have been lost since New Labour came to power. Only 3.22 million people work in manufacturing out of a total British workforce 28.6 million -a consequence of New Labour's ideological commitment to do nothing to limit capital's ability to move around the globe, hiring and firing and buying and selling at will.

It is absolutely essential then that trade unionists and political activists explode the myths and get arguments for social control back into the public domain. It is the job of the Campaign for Socialism and other socialists in the Labour Party to make sure that every Labour Party conference confronts the real state of the economy and offers real solutions based on social ownership.