Britain’s Liberal Democrats warn of “Greek-style” unrest

16 April 2010

Britain will be hit by “serious social strife” and waves of “Greek-style unrest” in the event of a narrow Labour or Conservative victory in the General Election on May 6. That is the forecast of Liberal Democrat leader Nick Clegg, made in an interview with the Observer newspaper on April 11.

With opinion polls predicting that neither Labour nor the Conservatives will win an outright majority, Clegg warned that a minority government formed by either party would face a crisis of legitimacy. This could result in “serious social strife” on the streets, he said, as the administration attempted to impose draconian public spending cuts in order to tackle Britain’s £160 billion-plus state deficit.

The massive debt is largely the consequence of Labour’s bailout of the banks, which has seen up to £1 trillion made available in various stimulus packages in response to the economic crisis precipitated by the crash of Lehman Brothers in 2008.

There is no doubt an element of political manoeuvring in Clegg’s comments. In the event of a hung parliament, the Liberal Democrats would play a significant role in coalition talks. Clegg has not ruled out an alliance with either party. Notwithstanding these calculations, the Liberal Democrat leader’s comments point to an acute political crisis that is building behind the scenes.

Clegg’s interview appeared as the European Union was meeting to cobble together a rescue package for Greece, in collaboration with the International Monetary Fund.

Over the last months, the Greek social democratic PASOK government’s austerity agenda has provoked strikes by hundreds of thousands of workers and mass protests. But the government’s pledge of wage cuts and job losses has failed to satisfy the international finance markets.

With state bankruptcy once again staring Athens in the face, the EU proposed a “life-line” loan of €30 billion. Set at interest rates of around five percent, however, the stop-gap measure will only increase Greek indebtedness, while condemning the population to yet more savage attacks.

The situation in Greece is paralleled by that in Ireland and Latvia, where even more draconian cutbacks have been imposed. Across Europe, all governments are making similar preparations.

Britain’s budget deficit is 12.5 percent of gross domestic product, the same rate as that of Greece. “If you really want a fiscal problem, look at the UK”, Mark Schofield at Citigroup told the New York Times last month. “Since the Labour government’s intense fiscal intervention in 2008 and 2009, yields on British government debt have soared to among the highest in Europe”, the Times continued. “And on a broader scale, which includes the borrowing of households and companies, the overall level of debt in Britain is the second-largest in the world, after Japan’s, at 380 percent of the country’s gross domestic product, according to a recent report by the consulting company McKinsey”.

While trying to play down the magnitude of the crisis facing British capitalism during the current election, Labour set out a £57 billion deficit reduction programme in its recent budget, while the Conservatives plan an additional £8 billion in savings immediately.

These measures are only the prelude to a massive assault on living standards.

Clegg poses the crucial question of how this can be pressed forward in the face of intense hostility from the broad mass of working people. He notes that Labour won office in 2005 with the support of just 22 percent of eligible voters. This means, he said, that the Conservatives could gain an “absolute majority” on just 25 percent of the eligible vote.

The Observer comments, “But in his own constituency city of Sheffield, where there are no Conservative MPs or councillors, and a high proportion of public-sector workers, he fears a ferocious backlash against potential Tory cuts”.

The danger, Clegg told the newspaper, is that, “Suddenly these people will be told by a government that has no legitimacy in their eyes that this government is going to slash and burn, having promised them something else”.

Clegg is offering the services of the Liberal Democrats as a supposed means of providing substance to any government’s claim to represent the electorate. He argues that it is “stating the obvious” to opine that a hung parliament would be good for the country.

He maintains further, according to the Observer, that, “The alternative would be to have a government that lacked support across huge parts of Britain at a time when emergency measures were needed to cut the deficit”.

There is no question that the Tory Party is largely confined to the privileged rural shires. There is currently only one Conservative MP in the whole of Scotland, and just three in Wales. In the largest 10 cities in England, excluding London, there are no Conservative representatives. Even in London, the Tories currently control just 20 of the 74 constituencies—all of them on the outskirts.

But this begs the question of Labour’s own lack of popular support. Labour’s control of major inner-city areas is today the outcome of Britain’s fundamentally undemocratic first-past-the-post electoral system. Abstention rates in the major urban centers are massive and growing, thanks to widespread disaffection with Labour.

A Labour government would have no more of a mandate to press forward its agenda than a Conservative administration. And a coalition of the Liberal Democrats with either or both of the parties does not change this one iota.

Clegg has no disagreement with the need to impose austerity measures on working people. He has called for “savage cuts” to be made in public spending, while the Liberal Democrats’ candidate for chancellor, the former chief economist for Shell Oil, Vince Cable, is calling for a “credible” and “explicit plan” for addressing “the black hole in the public finances”.

“The Tories talk tough on slashing the deficit, but have only identified miniscule actual credible cuts”. Cable complained.

The illegitimacy of the next government arises not from parliamentary arithmetic, but from the fact that the official parties are little more than sclerotic shells, through which the super-rich and big business politically advance their class interests at the expense of the broad mass of the population.

In the absence of a majority win for either the Tories or Labour, sections of the ruling elite have made clear their readiness to accept a coalition government. This would be passed off as a “government of national unity”, thereby providing a veneer of legitimacy to the austerity measures it has to impose.

Without any public discussion, contingency plans have been drawn up in the likelihood of a hung parliament. Under the proposals, the period of time given to Gordon Brown, as the incumbent prime minister, to form a government has been extended from 6 days to 18.

Even before a single vote has been cast, talks have taken place between the Treasury and other government departments with the Liberal Democrats as to their spending plans. Under the contingency measures, unelected civil servants will be able, for the first time, to “advise” the parties on forming a coalition. According to reports, the civil service has already spent months drawing up secret “doomsday” plans for cuts of 20 percent in public spending so that the new administration is prepared.

Clegg’s comments should be seen by working people as a warning. As he makes clear, the purpose of any coalition government, or of a “national government” of all the parties, would be to safeguard the political dictatorship of big business against any challenge from below.

Julie Hyland

Julie Hyland