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WHY IT TOOK FIVE MONTHS OF PUBLIC DISCUSSION TO GET A FREEZE
It is necessary to examine what marks out this attempt at Incomes Policy from other previous attempts both in Britain and elsewhere. The highly successful American "New Economic Policy" was grafted onto the society by Presidential prerogative. At first sight this appears mere than slightly bizarre. After all, the American bourgeoisie and working class have always stood four-square behind the principles of laissez faire and done very well with the market thank you, rejecting dogmatically anything that smelled of state interference. Nixon's NEP in August 1970 introduced far more Government control into the economy than the New Deal or Kennedy. It was done without prior warning or education or explanation to an initially hostile bourgeoisie and unco-operative trade union movement. However, the robber baron capitalists soon came to heel and indeed are now fully enthusiastic about wage-price controls while the trade unions have not even offered token resistance. There has been no discussion, explanation of the measures since their proclamation, either in Congress - where after all there ought to be the highest level of consideration and discussion of executive action - or in the Press. The classes simply accepted the measures as the Executive's prerogative and worked within them. No doubt if they had been unsuccessful, if there was not a high growth rate and a lessening of inflation, there would have been vocal opposition. But this would have been opposition concerning the incorrectness of the measures, not the Government's right to take them, to interfere in the economy. In Holland and Sweden, where institutionalised incomes policies have existed literally since the war, there is no public airing of the options open before the yearly agreements are made. The process of reaching agreement is clearly delegated to the TU officials and employers with the Government if necessary acting honest broker and the only form dissatisfaction has taken in both countries is strike action (which has been infrequent). There has been no concerted public airing of grievances.
In Britain the first Freeze in the postwar period was carefully explained to the trade unions by the Labour Government as necessary if Britain were to survive in the postwar world. It accompanied the 1949 devaluation of the pound and was accepted by the trade unions both as necessary (the economics of the need for more exports and also dollar paid imports were carefully gone through) and as a gesture of co-operation with a Labour Government that was part of the bargain if the Labour Party were to be able to represent the trade union interest in Parliament. After one year of Freeze, the TUC Conference of Executives refused to support the General Council's recommendation to continue giving support to it. They did this (despite dark hints that Labour defeat the next election would result) on the grounds that trade unionists gained nothing from the freeze and were indeed the losers - there were higher wages to be won and nothing that they could see which would be lost by winning them. Selwyn Lloyd's 1961 Pay Pause is next. NED (National Economic Development Organisation) a tripartite body for the continuing discussion of economic issues dates from this time. However, the pay pause was spectacularly unsuccessful. The trade unions were unprepared to discuss incomes and the National Incomes Commission (seen as the counterpart to NED by the Government) was boycotted by the trade unions and thus still born. (It should not be forgotten by the bureaucratic theorists of history that the TU movement was then in the grips of 'right-wing traitors' like Lord Carron and George Woodcock)
The Labour Government's attempt at Freeze in 1966-9 was also unsuccessful. Hugh Clegg has shown that there had been no thought inside the Labour Cabinet about how to administer an ongoing Incomes Policy, i.e. a Phase 2 and 3. After the statutory Freeze, the Cabinet was pre-occupied with the legal formalities and completely ignored the question of putting it to the country - making it intelligible and agreed. Clegg states that it does not particularly matter what the conscious rationale of an Incomes Policy is, but it must have one. Apart from George Brown's rhetoric, there was nothing. Consequently the trade union leadership had nothing to take to its membership to explain why collective bargaining should not continue as normal, taking from the bosses what they could get.
The current and much-vaunted hostility between the trade unions and the Tory Government derives only in passing from its Tory nature and much more from the working class reaction to the last Labour Government's moves. That Labour Government had relied on the trade union leaders to deliver a working class enthusiastic about progress, technology and planning. Instead the trade union leaders with nothing to explain to the working class and nothing concrete to offer from this New Age except Incomes Policy and In Place of Strife had their knuckles sharply rapped by the working class and support was withdrawn from Labour politics as a result ... until the Labour Party did its own volte-face. The Conservative Government responded to the assertion of working class power begun under the Labour Government by standing up to the challenge where Labour had abdicated. What happened? The Industrial Relations Act was passed but it could not be put into practice. The Miners were conceded a 20% increase as fair and just. And then it undertook the Tripartite talks in an attempt to arrive at a voluntary incomes policy after it had failed in its challenge to the working class.
Precisely because the working class and the trade unions had taken up a stand outside the sphere of Parliamentary Government and mutual concession, the Conservative Government was compelled to go much further than previous postwar Governments in taking the issues to the working class directly. Not only had there to be talks: they had to mean something and be explained step by step to the working class. For five months (since mid-July when after three months of preliminary meetings which were also public and well-reported aims had been agreed) the talks have been front-page news in every paper . Participants have been interviewed and subjected to cross-questioning by rank-and-file militants (Sid Harraway, CP Fords convenor became a hardy television regular) in prime television time. It has not been the "event" of the Talks that is newsworthy (i.e. what they ate for lunch in the breaks or what they looked like) but what they have been discussing. Both the Government and the TUC were under tremendous pressure from the working class to justify their presence at the talks.
The result was the TUC stated it could not simply talk about aims, brass tacks were necessary (see October Communist) The Government package deal was presented at the end of September and there followed a public discussion of its points. The Left Trade Union leaders were the most often quoted and interviewed, i.e. listened to. Both Jones and Scanlon refused to hide behind rhetoric or NEDO for what they were doing in Downing Streets They stated clearly that they were negotiating, looking for an agreement which they could recommend to their members. The foreign exchange markets throughout Europe and the US got very worried by these five months of constant airing of the economic ills of Britain. Here life went on as normal and everyone listened. Though IS and the CP shouted about the need for the working class to repudiate its turncoat leaders neither of them organised demonstrations or even protest meetings against the talks. Neither had the guts to put their counter-case to the working class and be judged by it on their case's merits . As for the Labour Party:
"The confusion on the Labour side has been equally fantastic - and instructive ... On the one hand there is a strong, though largely surreptitious, feeling of relief that the talks broke down, for they had always aroused deep suspicions on the Labour side. Suppose, good heavens, they had succeeded! It would have been a coup for the Prime Minister, and it would have undercut the Labour Party' s elaborately negotiated claim to be able to do a deal with the unions where Tory insensitivity was doomed to failure. But worst of all it would have robbed the Opposition of their occupation. If trade union leaders can negotiate amendments to the Fair Rents Act, increases in pensions and the introduction of threshold agreements directly with the Government, where does that leave Mr Wilson? This point was very reasonably elevated to the constitutional stratosphere by Mr Michael Foot in the debate the other night, but the root of the matter is the question of the power and credibility of the Parliamentary Labour Party." (D Watt, FT, 10.11.72)
"Contacts between the Labour Party and the TUC at a time when the TUC is talking to a Conservative Government while most union leaders are at the Labour Conference have clearly been delicate for the past weeks, and Mr Healey stressed today that he did 'not propose to tell the TUC how to deploy its case to the Prime Minister.' However, he described the Government's proposals as 'quite unacceptable'"(FT, 6.10,72)
"Mr Wilson argued that, although he hoped Mr Heath would be able to reach an agreement with the unions on prices and incomes, he thought the Prime Minister 'cannot and will not take the broader economic and social measures necessary to resolve this crisis'. Only a Labour Government could produce the policies necessary to win the co-operation of the unions ." (FT, 4.10.72) "Trade union MPs from all sections of the Labour Party - left, right and centre - last night gave a rough ride to Mr Victor Feather ... on the subject of wage restraint ...They are said to have expressed the strongest scepticism about the ability of the TUC to 'deliver' on any Chequers agreement involving a fixed figure for maximum wage increases ... The cause of the trouble was apparently Mr Feather's opening speech, giving a broad resume of the course of the Chequers negotiations so far, which was little more informative than the Press reports of the negotiations." (FT, l9.10.72)