Mick Lynch Summer

Contrary to the claim of the Prime Minister, we are not facing a wage-price spiral. For this to be true, wage increases would have to be regularly beating inflation, and they are not. In fact, current wage demands are well behind the projected increase in prices. For example, the rail unions are looking for around 7% at a time when inflation is rising to 9%. It's also worth emphasising that what is driving inflation is not wages but the cost of goods. As the ONS has explained, "Inflation is being fuelled by food and non-alcoholic drink prices, which are rising at the fastest annual rate since 2009, with the most dramatic increases seen in the cost of bread, cereals and meat." We are all familiar with the geopolitics of the increase in gas and electricity bills, and now we are seeing the supply-chain ramifications of disruptive factors such as China's Covid-19 lockdown and the war in Ukraine, but we shouldn't let these exceptional events obscure that the chief driver in rising prices is actually profit-seeking, which is often in turn the consequence of growing monopoly power. What this means is that inflation isn't going be "tamed" any time soon, no matter how modest trade unions are in their expectations. 

Those limited areas of the economy where wages are rising faster than inflation tend to be high-skill and relatively small. They also tend to avoid criticism by government, in part because they are sectors viewed benignly, such as banking, but also because their success is attributed to just deserts: whether through increased productivity or simply as the result of effective competition in a free market. Of course it's a commonplace to note the hypocrisy of politicians dividing society into makers and takers in this way, but perhaps the greatest echo of the notorious 1970s is the return of class to public debate, in the sense of overt material interests unadorned by culture war nonsense or the framing of inter-generational conflict. This turn has been marked in the UK by the incredulity of the liberal media on discovering that a working class trade union leader can be intelligent, articulate and sympathetic. The ensuing reverse-ferret has seen him achieve national treasure status in record time. It can only be a matter of days now before the Sun splashes on his "holiday hideaway paid for by union funds" or unearths some wobbly video of him appearing on a platform with Gerry Adams thirty years ago.

While Mick Lynch has good-humouredly played along with his role of dancing bear, he has used the opportunity to make it clear that he has nothing but contempt for the fourth estate and is unwilling to put up with its bullshit, which stands in marked contrast to the nominal leaders of the wider labour movement. Through this act of omission, he has made perhaps the most damning criticism of the Labour Party without the need to even mention Keir Starmer's name. Of course we should recognise that what motivates Labour's behaviour is not cowardice - the "power of the press" is exaggerated, not least by the press itself - but ideological congruence. As Jeremy Gilbert noted, "since the 1980s we have seen the consolidation of a professional class of senior managers, politicians and media operatives, who tend to share a culture and an outlook, whichever political parties or institutions they may be attached to. Its members tend to be socially liberal, but also utterly committed to the assumption that socialism, and even traditional social democracy, are political philosophies that died with the 20th century."

Gilbert has to choose his words carefully to get through the centrist filter of the Guardian, but it is clear that this is a class critique as much as a lament for the missed opportunities of the past: "While at one time it was the Labour party itself that was supposed to be the vehicle for bringing such people into public life, for much of the Blair period and beyond it has prevented these people from reaching positions of power, with the exception of the period of Jeremy Corbyn’s leadership." However, this is slightly misleading in that plenty of trade union hacks rose up the ranks and secured safe seats as part of the PLP during the Blair years too. That professional class of senior managers is to be found at the TUC's annual conference as much the CBI's shindigs. What is different about Lynch is not his class authenticity - with the unstated, patronising assumption that he might not be a whizz with spreadsheets or give a stuff about the niceties of HR policy - but that he is clearly representing class interests. This is a spectacle of class performance.

The response of the government has been interesting. Despite the 70s-style rhetorical tropes, they haven't tried to frame the struggle in the class terms familiar from that decade, when the damage done by inflation to "savers" was paramount and the critique of "over-mighty unions" segued into the demand to "let managers manage". Instead the focus has been on the divide-and-rule demographics that have dominated British politics since the 1990s, notably the need to protect pensioners. As the Guardian reported, "Dominic Raab, the deputy prime minister, defended the government’s actions on public sector pay, saying raising it could lead to a “vicious cycle of inflation”. He said it was right to hold out against higher wages for rail workers, who are striking this week over their pay, saying the government must not give in to “militant unions”. Defending the decision to raise pensions in line with inflation, he said: “[Pensioners] are particularly vulnerable and they are disproportionately affected by the increase in energy costs which we know everyone is facing.”"

This isn't just electoral calculation, otherwise the government would be doing a lot more for the elderly. We shouldn't forget that the state pension remains relatively ungenerous compared to other countries in Western Europe. The triple-lock has gone some way to improve the pensioner's lot in recent years, but it is an improvement from a low base. Pensioner poverty is still a thing. That said, they do enjoy some relative advantages. For example, they are less exposed to higher prices for petrol and food than families with young children. But to make these points is to fall into the trap of pitting age groups against each other and so occluding class. There are rich pensioners and poor pensioners; rich kids and poor kids. What ultimately determines their lives is not the degree of favour in which they are held by government but their ability to independently negotiate wages (and pension contributions) in return for their labour. It is the display of independence by the RMT that causes offence across the "professional class of senior managers, politicians and media operatives", hence Starmer's foolish ban on picket line appearances by his front-bench.

Where the government has returned to the arguments of the 70s is in reviving the traditional "private sector good, public sector bad" dichotomy, with the insistence that the size of the former - and the generosity of its remuneration - is a drag on the economy as a whole. This is an odd claim to make given that they have been in office for all bar 13 of the last 43 years (and their ideological hegemony has persisted throughout). You'd think over that time they'd have fulfilled their ambition of reducing the public sector to the point where its economic impact was marginal, or to have at least admitted defeat and accepted that "the state is always with us" and thus needed to be adequately funded. This was always a specious argument because the real concern was not "crowding out" but the risk of public sector wage increases setting a benchmark for the private sector. In other words, what they fear is a wage-wage spiral. I enjoyed the Economist's typically dry take on the subject which ended with the footnote "This article appeared in the Britain section of the print edition under the headline "Wage fright"".

The government has got itself into a bind of its own making. The expectations raised by Brexit of a high-productivity, high-wage economy unburdened by red tape were always pie in the sky, but Boris Johnson can't turn round now and say the sunlit uplands are off the menu. Equally, the idea of levelling-up, despite its policy incoherence, was always premised on a public expectation of investment in the fabric of the country. However much this might simply mean more tax revenues being diverted into the coffers of private businesses, in the manner seen during the pandemic, there is a common belief that it would lead to a reinforcement of the public sector, not further cuts and a steady decline in the services on which the depressed areas of the North and Midlands depend. It's also worth noting that one of the most effective ways of boosting small towns would be through pay rises for public sector workers, as in many they are the largest employment group and therefore a major driver of economic demand. 

What we are witnessing in the current inflationary moment is not the power of labour organised on a national scale (i.e. public sector unions) but the power of capitalism organised on a global scale (i.e. the likes of Cargill). In the 1970s, the political right were able to convince the public that capitalism was fettered and that its freedom would benefit all. That argument convinces few today. If anything, impulses like Brexit and levelling-up have to be seen as attempts to constrain global capital, not to empower it even further. In this context, the Labour Party's clear preference for business over organised labour is strategically obtuse and likely to prove electorally damaging, no matter how badly the Tories run government over the next few years and no matter how many low-turnout by-elections like Wakefield the party wins. The liberal media's focus on Mick Lynch is a distraction from the necessary choice of capital versus labour, just as the Labour Party's incessant blather about brand values and "repairing the Red Wall" is a distraction from its neoliberal ideology.