*Meanwhile, within total public expenditure, a higher priority is being given to expenditure which is designed to maintain or improve our industrial capability, and to give us a better chance of success as the economy picks up.
These words from Healey's White Paper on public expenditure sum up the Labour Government's economic strategy. The idea is to make room in the economy for more growth in industrial investment, in preparation for an 'export-led boom' as the world capitalist economy slowly turns upwards. "Changing the structural distribution of resources in this way is the only means of restoring and maintainWhite Paper. more towards this end. ing full employment, claims the This claim is a huge lie. Not only will the planned cuts have disastrous effects on the social services; the vast amounts of money designated for industrial investment, far from creating jobs, will actually destroy even million.
This is the major finding of Counter Information Services' second crisis report, Who's Next for the Chop (the essential facts on unemployment), published last week.* It charges that in the name of the regeneration of British industry', the Government is planning a permanent unemployment economy and that state intervention is directed 'State intervention is no new phenomenon, says CIS, but it is now probably more oriented to the needs of capital than ever before. At the same time, owing to the severity of the recession and the particular weakness of the British economy, that intervention is now more decisive. Its main effect will be to speed up the process of rationalisation and concentration of production, and that can only mean fewer INSTRUMENTS The chosen instruments of this policy are planning agreements and the National Enterprise Board. Far from being a step towards the opening of the books of capitalist firms to workers inspection, the purpose jobs. of planning agreements is 'to bring the bureaucracy of the trade unions, the mandarins of government and the captains of indThe other side of the new Information Services crisis report on unemployment | interventionist policy is the National Enterprise Board. This has been set up to cope with companies in which direct state intervention, through either shareholdings or long term financial support, is unavoidable. It will be getting at least £1,000 As the American business magazine Fortune (December 1975) put it: The Wilson Govern ment's programme for additional nationalisation is not based on blind socialist doctrine. The bleak truth is that most of the companies now being picked up by the state had been run into the ground by their private managers, and were in danger of going out of business.
CASE British Leyland is a case in point. Between 1968 and 1972 it distributed 95 per cent of the firm's profits to shareholders, keeping only 5 per cent for reinvestment. Even Lord Ryder had to conclude that this and not strikes was the main cause of bullish Leyland s probicus.
Now that the NEB has taken over, the main aim is still profit. The difference is that the NEB is prepared to wait until 1981 to see the results of the vicious productivity drive they call it rationalisation'- which is being fought out in Cowley, Longbridge, Solihull and other Leyland plants. Working class taxpayers are financing a concerted attack on their own The CIS report estimates that on the basis of the Central Policy Review Staff's report on the motor industry, a grand total of 275. 000 jobs will go in the motor and component supplies industry by 1985 - for good. Another 20,000 will go in aerospace in the next two years *The Government defends its policy of shifting resources from consumption to investment by claiming that it will create more jobs. But the investment is to be used to increase the productivity of the existing industrial base Apart from North Sea Oil, there is no new area where industrial investment is taking place to any significant degree 'As productivity increases, less labour is needed. The growth of productive capacity has not been enough to compensate for this, and the point was long ago reached where more labour is being expelled from production than is being re-employed. As a result the number of workers in manufacturing industry has fallen from 9,010,000 in 1964 to 7,758.800 in 1974.
The money now being 'saved" on schools and hospitals will be used to put more people on the dole - that is what all the White Paper's verbiage about improving to. In fact, it is the massive cuts in company taxation, rising cash subsidies to the private sector and rapidly increasing debt interest which are three of the most important factors behind the Government's deficit of £12 billion for 1975/6. But instead of attacking the vested interests of capitalism, the Wilson Government chops the social services to pay off these parasites.
And what of the existing state sector, which in the past has replaced many of the jobs lost in the private sector? The overal rise in government employment over the past 20 years 'masks the fact that the Government has been one of the greatest unemployers. British Rail and the National Coal Board have shed an enormous number of lob. over 700,000 over the past 15 years.
*For many years the prices of nationalised industry products and services were kept artific ially low, mainly as a hidden subsidy to the private sector This, together with the effects of direct subsidies in the form of fixed price contracts with major companies (these cost British Gas alone £180 million last year). resulted in massive losses.
*The Labour Government now demands that the nationalised sector becomes 'commercially viable. The two paths to this objective are firstly substantial price rises, and second much coming weeks in win support for t attacks on the so All militants si this report, which capably to one co whether in existir industry or the n sector, in vestmen only be beneficia employed in the is carried out unc real The Labour Governn "our industrial capability' amounts with pride at the mea Healey has taken to f The real picture, how different.
Clearly no-one is goi 'ainst measures to create should note two unings Firstly, the measures an last months are pathetic pared to the size of the secondly, the present air Cruments onces Is no manent jobs guarantee f ployers. If these measur ainst the overall strategy Government - massive social expenditure, the f - they amount to li face-saving operation to the TUC bureaucrats A closer look at the tion schemes work out i demonstrates this. They arily through two agenc ent offices of the Traini Jobs Creation Scheme.
In 1975 the Trainins trained 61,000 workers these stu were in area defined by the TSA