Furthermore, the effect of devaluation would be the same as always in the past. Imports would become more expensive, and exports cheaper. In the long term, the theory is that people will switch to buying because relatively cheaper.
But in the short and medium term, Britain's import bill would rapidly rise because the same bundle of imports, needed if working people are to live at the same standards as before, would cost proportionately That is why every past has been immediately draconian cuts.f The point is that, because of the long-term decline in Britain's dustry, this could not be financed by exports until huge amounts of new investment had been pumped into improving industry. And this money could be released only in one of two ways: either if working people make sacrifices, or if profits were sacrificed.
Of course if profits were cut, the resources could easily be freed. For example, the government now has to pay over £10bn alone. This would be enough to treble investment in manufacturing if the government nationalised the banks and froze debt repayments. government would also have to control investment itself, capitalists would not invest money without guarantee of longterm profits.
In short, only by a frontal assault on capitalist parties could the working itself. But precisely -Ine SDP Labour's right-wing - want to avoid.
The message is obvious: only a radical assault on the capitalist class c an get us out of the economic crisis and defend the traditional demands which working people expect from The aDolla By tying itself to the SDP, the Labour Party would responsible for the crisis. Just as in 1979, it would have to attack trade unionists, divide its own forces, and pay the political price of a further setback of historic proportions.
There alternative socialist alternative. If we want to make a future Labour government carry them out, we have to mobilise the very force the SDP was set up to oppose - the industrial might of the working class. If this Labour could not only defend itself whether or not it had a majority, but go on to increase its vote and divide Thatcher's by creating demoralisation and fear in the ranks of our true enemy: the bankers, financiers, and industrialists whose system, in its entirety, has got us into the mess we are now in.
brought Thatcher to office.
In contrast, the Labour government of February 1974, which came to office in the wake of the miners' strike, governed as a minority and went to the polls in late 1974 to win an increased vote and an overall majority. This was possible because of the extraparliamentary activity of the miners, whose strike had served as a warning to the ruling class that it would be unwise to obstruct the he Labour government until they had ty politically defeated it.
so The political defeat 1? delivered, obligingly, by himself. In June 1975 he sided with the Tories in fighting for admission to the Common Market, and won a majority in the referendum. He used ce this political victory to sack Tony Benn from the Department of Industry, junk Labour's policies, and use the "Social Contract' to help union leaders police the labour demoralising dividing it — leading to the Lib-Lab pact, and to Thatcher.