WSF (1997): “Workers Solidarity study series: Stealing from the poor-“Free Market” policies = Bosses’ tool”
From Workers Solidarity, magazine of the Workers Solidarity Federation, volume 3, number 1, first quarter 1997. Complete PDF is here
Internationally, there is a massive shift in the form of capitalism towards the so-called “free market”. In South Africa, we have the government’s new “GEAR” policy and capitalist “industrial restructuring” (see earlier article).
STATE AND MARKET
Before the 1970s, the key trend in capitalism was towards expanding the role of the State in the economy. This was done through governments nationalising industries, providing social services, and setting prices through boards. The most extreme example of this process was Russia, where the economy was nationalised and run by a State-capitalist ruling class. But the same processes took place throughout the Western countries and the Third World. This was not socialism, but a specific form of capitalism.
From the mid-1970s, however, the world-wide trend has been towards so-called “free market” policies. In other words, a trend towards the withdrawal of the State from direct involvement in the economy, and an attempt to regulate the economy through the “free” operations of buyers and sellers in the market. The idea here is that the State cannot run the economy properly. This set of policies goes by many different names: “neo-liberalism”, “monetarism”, “Thatcherism”, “economic rationalism”, “structural adjustment” etc.
FREE MARKET POLICIES
In concrete terms, these “free market” policies involve:
- Privatisation of State corporations.
- Removal of State control over prices and money (the removal of subsidies on basic goods).
- Cut backs and freezes on social spending as the government tries to minimise its costs.
- “Labour market flexibility”. This is bosses’ talk for: (1) sub-contracting out jobs, (2) taking on casual workers rather than permanents workers with rights and benefits;(3) undermining trade union rights; (4) undermining existing working conditions
- Promoting competitiveness. This includes: (1) reducing tariff barriers that restrict the import of foreign goods; (2) reducing taxes on companies and bosses.
- “Industrial restructuring” ( making bosses more competitive with the bosses from other countries) means: (1) Increases in productivity (2) “downsizing” (retrenching as many workers as possible); (3) so-called “co-operative” work arrangements that try to get workers to help manage capitalism and increase productivity.HELL FOR US
The effects of these policies on workers and the poor are overwhelmingly negative.
- Cut backs in government spending and privatisation means: (1) large scale retrenchment; (2) reduced access to social services such as health and education; (3) increased costs of social services, such as transport, due to new commercial and “profitable” rates.
- Higher prices on basic goods like food and petrol due to the removal of subsidies and an increased reliance on sales tax (Vat) instead of corporate tax.
- Attack on workers rights and conditions, undermining of trade unions by promoting “co-operative” work arrangements, expansion of low-wage and unorganised casual and sub-contracting workers.
- Unemployment.CAUSES OF FREE-MARKET POLICIES
Why are these policies being applied across the world? These are the main reasons:
- Capitalist crisis. Capitalist entered a crises in the early 1970s, as “growth” slowed and profits fell. The bosses response was to try maintain and increase profit by undermining union rights and workers wages, and by reducing taxes on themselves.
- Crisis of State-capitalism. The collapse of the State-capitalist systems of East Europe and Russia has undermined the idea that the State can run the economy. In the West and Third World, state intervention is blamed for the onset of the economic crisis in the 1970s.
- Multi-national corporations. The giant international companies that emerged after World War Two want cheap labour, policies that allow the easy international movement of money, and the chance to buy up State corporations
- International Monetary Fund and World Bank. These imperialist institutions promote free market policies by demanding that countries which use their loan facilities implement free market policies.WHAT WE SAY
There is no such thing as a “free market”. The economy is dominated by huge companies that own the means of life. We own nothing, and so have to work for the bosses for wages. No money means no food.
We are also exploited by the bosses who only pay us part of the actual value we produce (e.g. worker helps builds 50 Mercedes a month, gets R1,500). Their gain is our loss.
Free market policies are just an extension of this basic principle of capitalism. The bosses are trying to maintain and increase their profits by cutting our wages, services and jobs. They want us to pay for their crisis and themselves to keep living as fat cats.
GIVE THEM HELL
The only way forward for the working class is to resist all attacks on its existing conditions, and to fight for better conditions. We do not support this or that form of capitalism. We realise that capitalism with strong state intervention is still capitalism and therefore exploit workers and the poor. We must resist ALL forms of capitalism..
We must organise in our unions to force the bosses and the politicians to stop their attacks on us. We must also resist and kick out the “sell-out union bureaucrats” who support capitalism and the state by arguing for “restructuring” and privatisation. Trade unionism is the way forward to fight the bosses here and now, and, one day, to destroy their rotten racist system for once and for all. We must fight for real worker control of the economy through our trade unions. Massive fight backs against the “free market” in other countries who us we can win if we stand together, we workers and poor people.
WE CALL FOR:
- Mass actions and strikes against privatisation.
- Workplace occupations and strike action by workers threatened by job cuts. This must be backed up by maximum solidarity from other unions.
- Fight attempts to erode, privatise or cut off services.
- Defend worker and union rights