'THATCHER a skirmish to save face, reads comment from Al Haig. to Ronald Reagan after his fruitless discussions with the iron lady.
But more is at stake than prestige. Britain is the world's third military power; and its might doesn't just defend the British flag. It stands worth foreign vestments - more than any other power except ano tionally the highest foreign holdings in the Britain's world role is Thatcher's point of support. That is why she nas stakea so mucn on il. The Labour leadership unrowine away historic chance to ditch Thatcher, who 1OW 11101C vulnerable than ever Their jingoism is her last line of defence united assault Britain's workers combined with the poor of DIRECT INVESTMENTS ABROAD 5áo 2000-100 INFLOWS But this also highlights the political weaknesses of the Labour left.
TEeT approach, form or another, lies Tony Benn's view that Britain has ceased to be an imperialist power.
This view underlies the thinking behind the Alternative Economic Strategy.
therefore relates directly to the policy in the Labour Party.
All variants of the AES share the idea thal Labour government can capitalist resistance to reforms by protecting Britain outside influence. as planning agreements ana import reality subsidy workers to mecient capitalists) there lies the view that 'our' bosses will cooperate get the foreigners off their backs.
This only makes the remotest sense it believes that the main threat to change in Britain outside the country.
Apart from all else this is based on a gigantic error of fact.
Resistance to change in Britain is sponsored from within. It appears external OLIV because own capitalists are so heavily involved capitalism.
Consider, for example, the 1976 social service cuts which Tony Benn sees as the product of IMF imperialism. Michael Meacher tells a truer story Went Wrong:
The IMF,' he says, 'was largely the vehicle by OUTFLOWS OUTFLOW:
Fig 1 which domestic groups, including the City, Bank and Treasury, could get extra their elbows."
Similarly Benn presents Britain as almost the innocent slave of the world-dominating Pentagon.
the South Atlantic? Certainly Haig.
1108 Ironically, the Labour left is now asking Thatcher to listen to the Pentagon The fact is that Britain wants to play Robin America's Barman. It can break from US control onby scrapping its own world plans. understand that the enemy facing both them and the rest of the world is their U WIl capitalist class that the Labour left can't link up with their natural allies aoroad, such as lne Argentinian workers.
But they make another terrible mistake: they comunderestimate DICICH domestic resistance because they do not see how deep a mess our bosses are in Fig 2 Domestic Product.
decline dominated by a grotesque overextension of foreign economic activity, and particularly investment, at expense growth Forty-two per of VUI bosses make is produced abroad And this is on the increase. Figure 1 shows how the flight overseas has mounted with the decline of thee normi principal tradiction facing capitalism is this conflict between its role as a world military, financial and commercia dower trea strength. now impossible to resolve this contradiction without courage private investors to invest The AES, which calls on the government to imitate the 'GermanJapanese' model, ignores what had to be done to German and Japanese workers their economies could rebuilt.
Our rulers are compelled to attack with a ferocity that leaves the Labour lett bewildered. They tragically misunderstand both the resistance to their own mild reforms, stakes behind Thatcher's present attack on British working people. by a conflict between Brimilitary/financial century the two went Britain lent money to railways, bridges and min- wOre ne cloner • and seni back food and minerals to IOTe always When the world couldn't pay its debts, Palmerston sent a gunboat to collect. Indices of investment as proportion of Gross But whilst capital went abroad, other countries built up their own economies. Figure 2 shows the relative amounts home by leading capitalist countries for the last couple of decades.
And others began to make railways cheaper than us. Figures 3 and 4 show the consequences of the investment patterns of various capitalist tries.
In a to socialist world this would have led to a new division of laboul in which Britain built its nome economv under conditions of expanding trade.
But live in capitalist world. By relying on overseas investment the state worsened all the conditions that would courage private investors investment DOUROS world role made it cheaper to export Labilai dru produce. Colonial superprofits were an easy alternative to a frontal attack on the working class.
result was • that when Britain met competition it posted 'keep out' signs on half the globe one of which was stuck on the Falklands. war. meant that Britain's military and financial institutions became parasitic. They rely on agression maintain unense ver We now spend £8 bn every vear on arms. This is bad enough when we contrast it with current spending needs. But when think what could be done with it in terms of investment (including ment in social needs such hospitals and schools, half of which are now over fifty years old), the true maLure of this disaster becomes clear. British inmanulaciur ing, for example, could be trebled.
Banking is even nore outrageous. The Tories who fulminate against 'excessive state bureaucracy' say anything about UCVCI the fact that while state employment has remained at about 1.4 million since 1951 banking Cluby ment has risen from half a million to a million and a quarter over the same period.
This banking and finance sector is completeIv oriented to foreign investment. comparison holdings of British and German banks reveals that three of long-term British bank assets are abroad while three-quarters of German assets are at nome Furthermore industry and multinationals receive the same orientaGOt. Overseas direci vestment is now a growing proportion of overseas in vestment and has indeed led to a closer link-up between the city and industry - with the aim of pumping even more money abroad!
Thatcher's military adventures are provoked the same structural crisis as attacks oraclic maintain the operation of at home and abroad that Thatcher • attacks on both fronts, because there now no chance for her to retreat on either To defend Britain in the Falklands is to defend its world role - which can now only be guaranteed by means of a simultaneous war on working people.
Fig 3 I960 61 62 63 64 There is one enemy for both British workers and Argentinian workers Margaret Thatcher and ne class. She is more vulnerable to a combined INDEX OFOUTPUT PER MAN HOUR (1967 = 100) Source: MONTHLY LABOUR REVIEW NOVEMBER 1973 NETHERLANDI STATED -66 or 68 69 l0 t1 12 13 assault than ever before: labour movement's failure to take advantage of her weakness that keeps her in the saddle riding towards war.