Kwarteng’s mini-budget is a declaration of war on workers

By Tom Costello, Socialist Alternative in England, Wales and Scotland

Kwasi Kwarteng’s new budget for the rich is an open, naked display of class warfare. It represents a Tory party hurtling even further towards the right, as working class people begin to strike back against the cost of living crisis.

This budget amounts to a multi-billion transfer of wealth from what little sits in the pockets of ordinary people into the already fattening pockets of the capitalists. A mammoth £45bn in tax cuts, overwhelmingly benefiting the richest, are on the agenda. This is the largest single package of tax cuts in half a century. Rishi Sunak’s proposed corporation tax rate rise of 19% to 25% is to be scrapped. Even Tory MPs themselves have expressed worry at this budget being such a naked display of ruling class arrogance. 

In his statement, Kwarteng also announced plans to attack trade union rights. Passing this raft of anti-worker attacks will require a confrontation with the trade unions which our movement will have to uncompromisingly fight until the end. Socialist Alternative is calling for an emergency plan of action to beat back this budget and stage generalised action which can drive out not just the budget, but the Truss government as a whole. 

Capitalist elite divided

The Tories are fundamentally divided over this budget. As one unnamed Tory MP commented, they have “never known a government that has had so little support from its own backbenchers, just four sitting days in”. Even many of those Tory MPs who had lent their vote to Truss in order to appease the right-wing reactionary base of the party were notably absent from the scene when it came to supporting this mini-budget. 

Much of the British capitalist class has been in public disbelief. The pound compared to the dollar hit its lowest level in 37 years. The Tory promise of a special US-UK economic relationship has now been questioned as former US Treasury Secretary Larry Summers commented that “Britain will be remembered for having pursued the worst macroeconomic policies of any major country in a long time”.

RPI inflation sits at a whopping 12.3%. But these measures – a package of borrowing that will amount to an estimated £411bn is expected to only add fuel to the fire. The Bank of England has indicated that this budget will push them into further interest rate hikes, which will worsen a recession which it says has already begun. The devaluation of Sterling together with inflation also threatens  an unparalleled debt crisis.. 

However, the most important reason why some capitalist commentators have voiced opposition to the budget is the fear that it will further stoke anger among working class people facing the worst impacts of the cost of living crisis. If workers see a government that is transferring wealth rapidly towards the billionaires and CEOs in an era where workers are left hungry and cold in the winter, their system will come under deeper scrutiny. The wave of strikes – on the railways, at Royal Mail, in education, as well as among dockers at Liverpool and Felixstowe is already explosive raw material for the bosses! 

As Socialist Alternative has pointed out, capitalism is entering into a new era – one marked by both state intervention, a retreat into protectionism and the new US-China ‘Cold War’. This death of the neoliberal era, however, will not mean an end to drastic anti-worker attacks. Truss and Kwarteng represent a hardline wing of the Tories – an ideological wing of the ruling class removed from reality and deluded about its own ability to push through these attacks. Like Thatcher, what Truss wants is a full-on confrontation with the trade union movement, with the aim of dealing a decisive blow early on. 

Workers movement under threat

It is no coincidence at all that, alongside the tax cut plans, is a new proposed raft of some of the most severe and restrictive anti-union laws in recent memory. These include a new proposal, long hinted at and proposed by both Sunak and Truss in the leadership campaign, for ‘minimum service laws’ in ‘essential services’. These would, in effect, make meaningful strike action illegal.

This is quite explicitly in Kwarteng’s words, to smash “militant” (in other words, effective) trade unionism. This is a declaration of war which can only be met by an even more determined declaration of intent to fight from our side – of the working class. The entire trade union movement must urgently be mobilised to make clear that no attacks on trade union rights will be accepted.

The momentum at this stage is still overwhelmingly with the trade unions. The strikes continue strong, even after a period of enforced ‘national unity’ following the death of Queen Elizabeth II. The resolve of workers to fight back is still strong. Kwarteng is putting this bill forward at this time in the hopes that, if events slow down, the billionaires and Tories can go on the offensive.

However the new proposals, if passed, can and must still be defied by the movement! If action is fully coordinated, if the unions draw on their collective strength and plan to coordinate, escalate and broaden action into all sectors, we can win. The proposal from the Tories that insulting, paltry, below-inflation offers automatically must be put to a ballot of union members should not be followed even if it passes. If non-compliance was organised across wide sections of the trade union movement, the Tories would be left powerless to enforce it.

During the week that these new anti-worker bills are put to parliament, Socialist Alternative says that a bold call for a one-day general strike, bringing workers out  in the public sector and private sector, could demonstrate the mighty power of workers . Such a movement would rattle the disunited Tory Party even further and open up the possibility of Truss being forced to U-Turn.

It could galvanise the resistance and not only stop the Tories in their tracks, but bring the government down. This would then have the potential to put the workers movement on the front foot, not just to fight new anti-union laws but to repeal all undemocratic restrictions on workers’ right to strike. 

Enough is enough! Build towards a general strike

The Trades Union Congress should immediately begin organising a general strike from now, in response to these attacks and the cost of living crisis. But it is quite clear that they are so far not up to this task.. Likewise, Keir Starmer’s pro-big business leadership of the Labour Party is actively hostile to workers taking action. This is why the task of fighting to build a general strike falls in the short term to workers and those unions who have already shown some willingness to fight. 

Mick Lynch stated the other day: “RMT and other unions will not sit idly by or meekly accept any further obstacles on their members exercising the basic human right to withdraw their labour.” This is absolutely correct. But it will mean stepping up the pace of the action. A campaign to increase both the frequency and duration of strikes, while appealing for other unions to synchronise and escalate their action is needed.

Democratic, united strike committees, drawing workers in dispute together should be established to connect those disputes. This could also be a conduit to tap into the huge public solidarity with strikes, as is seen in the continued growth of the Enough is Enough campaign with its thousands-strong public rallies. 

Tories could be forced out

As the media were quick to point out, the new Kwarteng budget contains the biggest package of tax cuts for the rich since the Tory Heath government 50 years ago. 1972 was a year of huge class battles. Hundreds of thousands of miners, alongside dockers and builders put the Tories on their knees. The Tories asked the question then: “Who runs the country? The government or the unions?”. People chose the unions; the Tories were kicked out. Something similar and potentially even more powerful could be organised today. But only if we fight for it and organise from below to demand action from our leaders. 

Socialists say: 

  • We need a general strike! Fight to win every ballot and escalate and coordinate the strikes! 
  • Build Enough is Enough as a mass, unified, democratic and socialist mass movement. Build local groups with democratic structures at all levels
  • Make the rich pay for the energy crisis! Cap bills at socially affordable levels and tax the super rich to pay for it! Nationalise the energy companies and invest in an accelerated green energy transition that defends all jobs 
  • For a sliding scale of wages! Permanently link all wages to the rate of inflation by law, alongside pay rises to compensate for real pay lost over the last decade of austerity
  • For a £15-an-hour minimum wage now, to rise with inflation at least annually! 
  • Raise Universal Credit, pensions and all other benefits to the level of a living wage
  • To end economic robbery we need revolutionary socialist change! Nationalise transport, mail, energy, all utilities, the banks and major monopolies under democratic workers’ control, with compensation only for proven need. Build a socialist economic plan to end poverty, climate destruction and all forms of oppression
  • Build a new a mass left party, based on the struggles of the working class, youth and oppressed that can unite people across the sectarian divide
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