The Liberal Democrats held their party conference in Birmingham last week, amidst the greatest global crisis of the capitalist system the world has ever seen.
Not a day passed without ever more dire warnings from the International Monetary Union, the European Central Bank, the US Federal Reserve and the Bank of England about the precarious state of the world, European and British economy.
While Liberal Democratic leader and Deputy Prime Minister Nick Clegg and his spokesman for business and innovation, Vince Cable, could draw attention to these developments, they could not address them in any serious way.
In part this is because they are the junior partners in the coalition government with the Conservative Party, and it is the Tories who determine economic policy. Prime Minister David Cameron and Chancellor George Osborne have made clear there is no “Plan B”—a code word for a retreat from the policy of massive austerity measures set out by the government.
But the Liberal Democrats have themselves played a lead role in justifying the coalition’s £80 billion of spending cuts and insisting, too, that there can be no turning back.
The nervousness of the Liberal Democrat leadership was obvious. Cable’s appearance in particular, with lips and hands shaking uncontrollably as he spoke, made clear this is a party in crisis.
This is hardly surprising, given that in the last year they have trampled on every single policy they once claimed to represent.
Having agreed to the tripling of tuition fees and abolished state aid for working youth to attend college, the Liberal Democrats are helping oversee the destruction of tens of thousands of public sector jobs and wage cuts—as well as demonstrating a callous indifference to the lives of the sick and elderly with their dismantling and privatising of large sections of the National Health Service and social care.
So as not to break up the coalition by antagonising the Tories, the Liberal Democrat leaders even ditched their pledge to introduce proportional representation. Instead, they ran a half-hearted campaign for an Alternative Voting system that failed miserably.
Their actions have generated a lot of anger. This last year has been the Liberal Democrats’ annus horribilis, as the party witnessed its previous popularity plummet and membership collapse.
At the height of protests against the hike in student tuition fees earlier this year, Clegg’s effigy was burnt in the streets and urine was poured through his letterbox. In the May 2011 local authority elections, the Liberal Democrats lost more than 800 seats and outright control of some important County Councils.
As soon as it was clear that the May 2010 general election had produced no clear winner, Clegg and company fell over themselves in the dash for the ministerial cars and official governmental trappings. But it would be wrong to believe they had joined the coalition solely for these reasons. Most of all, this ragbag collection of political nonentities have convinced themselves that it is their historic task to save British capitalism, and especially the City of London. They were only too ready to ditch their election pledges to launch a rescue mission for Britain’s banks and super-rich, funded through austerity against the working class.
For years, the Liberal Democrats had presented themselves as being to the left of the Labour Party. They was able to do so only as a consequence of Labour’s abandonment of its past reformist programme and its refashioning as a right-wing party of big business.
The individuals remaining in the Liberal Democrats now are those that agree with its change of political direction. It is this, the party’s place in “the corridors of power” and the escalating world capitalist crisis, that ensures the Liberal Democrats’ continued rightward orientation.
At their conference then, the Liberal Democrat leaders had two main aims. The first was to try and conceal the true class nature of their party by rewriting its historical origins. The second, related aim was to justify why they are remaining in the coalition and imposing its attacks.
In an attempt to provide himself and his party with some historical legitimacy, Clegg peppered his speech with references to individuals from the former Liberal Party (1859-1988), claiming his party represented its “great Liberal spirit”.
He declared; “This Conference centre is on the site of the old Bingley Hall where [four-times prime minister] William Gladstone stood 150 years ago to found the National Liberal Federation”.
He went on: “Economic insecurity. Conflict and terrorism. Disorder flaring on our streets. Times like this can breed protectionism and populism. So times like these are when Liberals are needed most. Our party has fought for liberal values for a century and a half; justice, optimism, freedom. We’re not about to give up now”.
As Clegg himself knows, the origins of the Liberal Democrats lie not so much in the nineteenth century Liberal Party but rather the Social Democratic Party (SDP) of the 1980s. The Liberal Party was finished as the second major political party in Britain after the Labour Representation Committee broke away to set up the Labour Party in 1906. But it was a right-wing faction that broke with the Labour Party in 1981 to establish the SDP as an explicitly bourgeois party, hostile to the working class.
This was the work of the notorious “Gang of Four”—Shirley Williams, Roy Jenkins, David Owen and Bill Rodgers. All of them had been ministers in previous Labour governments but split from the party, accusing it of moving to the extreme “left” under the pressure of the trade unions.
Apart from anything else, their breakaway made it easier for Thatcher and her Tory government to win its second general election victory in 1983. Between 1983 and 1988, the SDP joined an alliance with the flea-ridden carcass of the old Liberal Party, before merging to become the Liberal Democrats.
Cable’s speech was unremittingly dark from the beginning. “These are dangerous times for our economy” and “there is much uncertainty,” he said.
He wanted to create a wartime scenario in order to justify his government’s austerity measures, so he harked back to the coalition government of the Second World War.
“I thought of [Labour leader Clement] Atlee and [Ernest] Bevin working with their Tory opponents—Churchill and Beaverbrook—setting aside their political differences in a common cause.
“That coalition unleashed the great Liberal reformers: [William] Beveridge and [Maynard] Keynes. Now, you could say: that was war; that’s different. Yes it is different. But we now face a crisis that is the economic equivalent of war. This is not the time for business as usual; or politics as usual. The financial crisis is still with us.”
This is all sophistry. Atlee and Bevin could at least rationalise their participation in the “national unity” government by citing the threat of imminent Nazi invasion. As for Cable and Clegg, they can only grovel before the financial oligarchy and super-rich.
There is much to be said about the politics of the liberal economists Beveridge and Keynes. Suffice it to say in this instance that they are generally credited with helping create the ideological and economic framework for the establishment of the welfare state. In contrast, Cable and the Liberal Democrats are intent on destroying it for once and for all.
That is why at the conference, besides announcing a few inconsequential measures, they were mainly interested in trumpeting their own role in “defending the national interest”.
Referring to the unbridled speculation and profiteering that helped create the current economic crisis, Cable apologised that “A bad message was sent; that unrestrained greed is acceptable.”
Like the man who locks the stable door after the horse has bolted, he wants to help encourage a “Responsible Capitalism”. He warned that unless some form of regulation was introduced in the UK, there was the danger of “massive potential instability…caused by UK-based global banks whose combined assets are over 400 percent of GDP, by far the largest of any major country.”
But all he could offer was the proposal to “separate retail and casino banking”—a measure that has yet to be legislated on, much less enacted.
As Cable was speaking, the Bank of England was preparing a new round of “quantitative easing”—i.e., more taxpayers’ cash to the banks. This makes a fallacy of the coalition’s claims that “We are all in this together” and will ensure it does not have long to last.