By Mark Buckley
The Labour government is imposing another round of austerity measures, extending the offensive that began under the Tories in 2010. The fightback can begin in earnest with the call of the People’s Assembly Against Austerity demo on 7 June.
Austerity is objectively linked to both the current war drive and the policy of whipping-up racism. Some of the cuts are directly linked to the increase in military spending, while racism is blatant scapegoating; blaming migrants and asylum-seekers for the effects of the austerity policy while chasing Reform UK’s politics.
Within the united front against austerity socialists need to explain these three aspects of the current crisis in a combined way. The economic and social crises arising from austerity is the capitalists’ response to economic stagnation, which must be countered by the demand for public investment. At the same the demand must be for no increase in military spending, which only contributes to rising poverty and militarism. The whole of the left must challenge rising racism, explain the scapegoating for what it is, how it is used as a distraction from austerity and making no concession to the racists’ agenda.
The fightback takes place as the government has created a trio of channels for popular discontent, over cuts to the winter fuel allowance, disability benefits and the two-child benefit cap. These are direct and obvious attacks on the poor and the most vulnerable and there has deservedly been a large push-back against them from Labour MPs, including from both the centre and the left as well as from some unions.
But the austerity policy is far broader than these controversial cuts to welfare. The October 2024 Budget introduced a range of measures that amount to a wide attack on workers and the poor. These include a freeze on income tax thresholds so that more workers will be paying higher tax, strict public spending controls which mean some public services are underfunded (the NHS) or others experiencing outright cuts (local government services), and no funding for public sector pay rises in future years, which will either lead to real cuts in public sector pay, or cuts to services, or a combination of the two.
All the leaks and briefings ahead of the 11 June Spending Review suggest more cuts to come. It is rumoured that the NHS will receive a 2% increase, which is insufficient to meet the needs of new technology, as well as an ageing, rising population. It will mean cuts in NHS capacity, while other areas of public spending are set to receive outright cuts.
The exception is military spending, where Starmer and Reeves are aiming to meet Trump’s initial demand for an increase in spending among all NATO members, and have set a target of 2.5% of GDP, even as welfare and other essential spending is being cut. It will not satisfy Trump, who is now insisting on 5% military spending among NATO members. His demands are based on the US policy shift to menacing China, and his insistence that the European NATO members assume the financial burden of war with Russia.
None of this will spark a recovery in the British economy, and Starmer and Reeves have set up a doom-loop where a weak economy, pressure on government finances and more austerity reinforce each other. The economy has grown close to a 1% pace for the last four quarters, and official boasting about ‘the strongest growth in the G7’ is plain foolish, revealing much more about the parlous state of the G7 economies than anything positive about the British economy.
All of this feeds into the plummeting level of support for Labour and the rise of Reform UK. Repeating the same policy will only reinforce current political trends.
Beginning the fightback against austerity, explaining how it is linked directly to military spending and the rise of racism is the first step in a long fight to revive the left, to defeat these attacks and to push back against Reform UK.
