This is the third part of A Critique of Jeremy Corbyn and British Left Social Democracy, written by Allan Armstrong. The first part can be read at:- the second part can be read at:-





Contents of part 3

 a.     The limits placed on social democracy during a crisis of global capitalism

 b.     From revolutionary democratic social democracy to existing state-accommodating reformist social  democracy

 c.     A further shift in the meaning of social democracy; the brief emergence of an alternative revolutionary democratic communism; and the descent to state-backed official communism and dissident communism

 d.     Social democracy and official communism morph into social neo-liberalism

 e.     From social liberalism to populism



a.     The limits placed on social democracy during a crisis of global capitalism

i.       We are living through a period of unprecedented global crisis – political, economic, social, and cultural. This means that ideas will be tested continuously. A democratic party based on the exploited and oppressed will have people from a whole number of tendencies – communist (as outlined in 2.f.iii), republican socialist, social democratic, movementist, green socialist, socialist feminist, environmental, etc.

ii.        Any new party needs to recognise that political ideas will be in ferment, and not try to come up with some deal, which freezes the political relationship between particular tendencies, in order to bring about diplomatic ‘unity’. In a fast changing situation, the relationship between these tendencies, and the relevance of the arguments they make, will change. Thus, it is not some political deal that is required (which usually means marginalising those people and suppressing those arguments which it is thought will undermine this unity), but promoting the most advanced democratic culture, where different ideas can be thoroughly debated, applied and tested.

iii.       The current extent of the multifaceted crisis we confront is such that it is highly unlikely that any of the dominant forms of politics found in the world today can bring an end to the uncertainty, insecurity and threats to human lives. In the run-up to the horrific 1914-18 First World War, which marked the culmination of an earlier period of imperial crisis, Rosa Luxemburg said that the choice facing humanity lay between ‘Barbarism or Socialism’. In the event, humanity had to endure this war, and after a relatively short post-war boom, they then had to go through the growing barbarism of the late 1920s and 30s. This culminated in the even more horrific 1939-45 Second World War.

iv.       However, the resulting massive destruction of capital allowed for a new (but still pretty destructive) period of post-war reconstruction. Keynesian state intervention in the ‘West’, and Party-state controlled planning in the ‘East’, were able to deliver real gains in such a period of economic expansion. These provided the material basis for renewed national statist, social democratic politics in their different forms – ‘Western’ and ‘Eastern’.

v.         It is not surprising that today’s social democracy has deep roots, particularly in a long-standing state like the UK, which once dominated the world economy, and hence for a long period was more shielded from the effects of crisis than more peripheral, imperially dominated countries. This meant the British ruling class could make concessions to its working class. Due the conservative nature of the UK state though, such concessions were only made after considerable political pressure. And these concessions were made in return for ‘lower orders’ acceptance of the UK state and its continued British imperial policies.

vi.         Ignoring or downplaying these aspects of British rule, British social democracy became associated in many workers’ minds with the periods when they enjoyed more secure lives, their best pay and conditions, and improved access to health, education, leisure and cultural provision. Hence, there is the desire to turn back the clock – to the ‘Spirit of 45’ or 1972-5. These dates correspond to the beginning and the end of the post-war boom. The idea that capitalism can be permanently reformed and eventually lead to a post-capitalist society (which some social democrats might call socialism) has formed the basis of social democratic politics, at least since the First World War.

vii.       However today, such is the threat from continued economic recession, environmental degradation, and nuclear and other forms of warfare, that for Rosa Luxemburg’s ‘Barbarism’, the independent marxist, the late Istvan Mezsaros has substituted ‘Barbarism or Worse’. We have entered another period of imperialist crisis, and as during previous crises, social democracy will be found wanting.


b.        From revolutionary democratic social democracy to existing state-accommodating reformist social democracy

i.          Before examining more contemporary events, it is necessary to go back much further and understand the changes in the meaning of social democracy. In the lead up to the 1847-9 International Revolutionary Wave, democracy was understood as being based on the principle of the sovereignty of the people expressed in a republican constitution. Thus democracy and republicanism were closely linked revolutionary ideas. This is why people saw that the struggle to attain popular sovereignty needed to be achieved by revolutionary democratic means. There were already divisions over how this was to be done, whether by party methods, or by communes and revolutionary societies, or some combination of these. These divisions had already appeared in the first phase of the International Revolutionary Wave between 1789 and 1795. They were to reappear in the future.

ii.         In the lead up to, and during the 1847-9 International Revolutionary Wave, a minority began to analyse the deeper contradictions in the emerging new society. They recognised the significance of the labour and capitalist divide, and not just the older monarchy/aristocracy and people divide. They realised that, unless the labour and capitalist divide, which provided the real underpinning of the new rising capitalist order, was transcended, then exploitation, oppression and alienation would be reconstituted in a new form. Wage slavery would replace earlier forms of exploitation. This is why they argued that capitalism’s social conditions would also need to be ended – hence the ‘social’ prefix to democracy. As understood in this sense, social democracy was synonymous with communism.

iii.        Despite the defeat of that vision, the 1847-9 International Revolutionary Wave still resulted in the end of feudalism and exclusive monarchical/aristocratic power in Europe and led to the further undermining of other tributary social systems in the world, e.g. in India, China, Japan, the Ottoman and Persian Empires. A massive expansion of capitalism took place, particularly in the leading imperial states – the UK, France, and later Prussia/Germany and USA. The consequent rise in living standards  for the majority contributed to the consolidation of parliamentary representative forms of government. Although there were still considerable democratic limitations and many living in destitution (as could be seen in the UK, France, Prussia/Germany and the USA), what had been understood to be democracy before – a republic based on the principle of the sovereignty of the people – became replaced with the much more limited concept of parliamentary democracy with an extended franchise, and the possibility of further economic and social reform.

iv.         In the leading imperial countries, the expansion of capitalist economic relations, particularly to industry, helped to create a new working class, the majority of whose living standards did improve. They now accepted this capitalist framework as given. In the UK, following the defeat of the social republican wing of the Chartists, new working class organisations appeared. These included the Model Trade Unions, which looked, not to  the ending of wage slavery, but to  ‘a fair day’s pay for a fair day’s work’. Their members often also worked within the Radical, and later the Lib-Lab section of the Liberal Party to press for economic and social reforms and further extensions to the franchise.

v.          Nonconformist and other Christian influences also became more deeply rooted in the UK working class, leading to the marginalisation of freethinking and secularism. As the state’s remaining political and social restrictions on Nonconformism were removed, the leaders of these denominations began to have greater influence after their bourgeois members joined the British ruling class. (This process occurred more slowly for those from a Catholic or  Jewish background). A Christian cross-class social liberalism was promoted to undermine any independent working class thinking or organisation. Christian social liberalism could give its support to improved economic and social conditions for the working class. However, their working class tended to be the god-fearing, respectable and skilled, beyond whom lay the godless, non-respectable and unskilled. Christian thinking also  promoted a divide between men’s world of work and women’s domestic world. Rather than secular education, denominational schooling was increasingly accepted. In this way working class boys and girls could be more easily disciplined and prepared for their allotted role within capitalist society.

vi.          A more ecumenical, but still Christian wing of social liberalism emerged (indeed some would call themselves Christian socialists), which did hold to a vision of a new society; but one that would come about through the gradual evolutionary changes, as a projection of an almost inevitable ‘British road to progress’ under divine providence. This ‘British road to progress’ became useful to the British ruling class’s wider imperial aims. Indeed this could be exported, particularly to the white settler colonies.

vii.       Social liberalism had a major impact upon the British social democracy, which emerged from the 1880s. Whereas the earlier social democrats understood the need for a revolutionary democratic overthrow of the state, the ending of wage slavery, and the transformation of the world order, the new social democrats accepted the wages system, the existing UK state and the British Empire. Some even welcomed the attention and honours they received from monarchs, aristocrats and business leaders. Following the ruling class, they equated democracy with Westminster and the UK state. They looked for  further extensions of  the franchise and improved educational provision, so the working class could be ‘brought in from the cold’.

viii.       Soon, social democracy came to mean, in effect, social parliamentarianism, with an acceptance of such blatantly undemocratic features as the monarchy, House of Lords, Crown Powers, an established religion, and the unionist and imperialist suppression of national self-determination.  The growing acceptance of the legitimacy of such institutions and practices represented an extension of the newer social democratic acceptance of the anti-democratic features of the existing states in which they operated. The word ‘social’  began to appear before many other terms, e.g. monarchy, imperialism and patriotism.

ix.         Following this early shift in the understanding of social democracy, the main working class organisation, which emerged in the UK, the Independent Labour Party (ILP), was treated with some reservation by other social democrats in the orthodox Marxist-dominated Second International. The ILP was often pulled into political alliance with the Liberal Party, particularly when the latter became more overtly social liberal under Lloyd George’s New Liberalism. The ILP’s name did not proclaim its commitment to social democracy/socialism because the leadership thought that its ideal future society could be obtained by stealth, through the gradual reform of capitalism and Westminster under the existing UK constitution. Influenced by the Fabian Society and trade union leaders seeking only  improvements within the existing order, the ILP’s name did not include social democracy or socialism, because these still had revolutionary connotations and would scare off the social liberals, whose votes they were seeking.

x.         Nevertheless, the ILP passed another test of the Second International. It represented significant sections of the organised working class, particularly those in British trade unions. The self-proclaimed Marxist Social Democratic Workers Party had already been prepared to join with the non-Marxist General German Workers Association to form the SAPD in 1875, because of the latter’s larger organised working class support. Marx expressed his reservations about this deal in the Critique of the Gotha Programme.

xi.        The SAPD became the SPD, when legalised in 1890. In 1891, Engels noted, in his Critique of the Erfurt Programme, that the by now orthodox social democratic SPD did not oppose key elements of the reactionary Prussian/German constitution. Even official social democracy was beginning to give primacy to the continuation of its host state, which underpinned the capitalism to which it applied its minimum programme of reforms.

xii.       After the Second International was formed in 1889, it sought to recognise member parties on the basis of one state/one party. However, since there was, as yet, no official state backing for such a notion, a number of parties, not formed on this principle, were still recognised. Ironically, this happened because inter-imperial conflict was beginning to make its impact, and some non-state parties in particular states could get support from the one-state parties in other states, when there was some imperialist tension between them. Hence, James Connolly’s Irish Socialist Republican Party was able to get recognition at the 1900 Second International conference, against the wishes of the British social democratic representatives.

xiii.     Internationalism was now pursued through diplomacy between state-based member parties. This mirrored the way the imperialist states conducted their business. Any severe crisis was likely to disrupt particular states’ and parties’ diplomatic arrangements. The degree to which the SPD accepted its host state was finally displayed by its support for the First World War in 1914. The degree to which this was true of the majority of other state-based member parties was highlighted by the collapse of the Second International in the face of this war. Even when the true horrors of this war began to impinge on these social democrats’ thinking, they looked little further than to the re-establishment of peaceful diplomatic relations between their states and within a reconstituted  Second International after the war.

xiv.       Thus, over quite an extended period of time, earlier in some states than others, depending on how well they were placed in the global pecking order, the term social democracy relinquished its onetime revolutionary democratic and internationalist connotations.


c.          A further shift in the meaning of social democracy; the brief emergence of an alternative revolutionary democratic communism; and the descent to state-backed official communism and dissident communism

i.            In the face of the horrors of the First World War, the minority revolutionary democratic wing of the Second International began to prepare for a new International. The Communist or Third International was formed in 1919, in the midst of the 1916-23 International Revolutionary Wave.

ii.          This International Revolutionary Wave produced some of the most advanced thinking, in regard to defining and putting emancipation, liberation and self-determination into practice, that has ever been witnessed. Even after its final crushing in 1923, there were continued eddies and ripples. As often happens following major defeats, these also took the form of cultural renaissance.

iii.         The dilution of any rounded and connected vision of emancipation, liberation and self-determination took an extended period of time in the case of the  earlier social democracy. However, this process happened much more quickly with the establishment of state-backed official communism, following the spectacular rise and fall of the 1916-23 International Revolutionary Wave.

iv.         Furthermore, this process continued amongst many of the dissident sects, which left the Third International, after the crushing of the Kronstadt Rising in 1921; after the exile of Trotsky in 1928; and after 1956 following the CPSU revelations once Stalin had died. Official communism had become equated with a Party-state presiding over a nationalised economy. Many dissident communists whilst no longer accepting the legitimacy of the official Party running the state, still upheld the revolutionary nature of the nationalised property relations it was based on.

v.           For the official communists, a new global communist society would no longer come about through a revolutionary democratic extension of socialist republicanism wherever the exploited and oppressed had won power, but by an extension of a national state-based ‘socialisms in one country’. Internationalism increasingly took the form of unquestioning support for a Third International, which was subordinated to the interests the USSR Party-state. Wherever new Party-states were created these were meant to become part of the  new international socio-economic order created by the USSR. New international economic bodies like COMECON (1949) were set up. As long as the old imperialists still threatened, then the Warsaw Pact (1955) was meant to provide military defence.

vi.          However, the leaders of those states participating in the bodies set up by the USSR soon realised their own subordinate position within this new set-up. This resulted in the freeze in relationships between USSR and Yugoslavia after 1947, Albania in 1961, and Romania in the 1960s. It was shown by the USSR-state promoted Warsaw Pact military interventions in Hungary in 1956 and Czechoslovakia in 1968. China never joined COMECON and border skirmishes with the USSR broke out in 1969. Bigger wars took place between Vietnam and Kampuchea in 1978 and China and Vietnam in 1979.

vii.        The Party-states’ inability to deal with the National Question, even within their own borders, has been highlighted by the break-up Yugoslavia in 1990 and the USSR in 1991; and the continued national resistance in Tibet and Xinjiang to their incorporation within the Chinese state.

viii.       The old one-state/one-party policy of the Second International was taken a step further in the official Party-states, where defence of the one Party-state became official policy. The USSR provided an interesting comparison with another Union state – the UK. Both officially recognised their own multi-national make-up. They both created ‘international’ identities – Soviet and British, which incorporated hyphenated subordinate identities, e.g. Russian and Ukrainian Soviet or Scottish, Welsh and ‘Ulster’ British. In the UK, the Crown Powers negate any right of national self-determination. In the USSR, the supremacy of the one-state Party had the same effect.

ix.         In the meantime, the national reformist social democracy, which had developed in the period leading up to the First World War, became organised in a new Labour and Socialist International (L&SI), set up in 1923. The addition of the word ‘Labour’ reflected two things. First was a dilution of any specific socialist requirement as a condition of affiliation. The second was the ongoing battle with the new Third International as to which party best represented the working class.

x.          Where, in the immediate context of 1916-23 International Revolutionary Wave, the working class became drawn into major class struggles, e.g. France and Italy, or into struggles facing the additional whip of competing state powers’ imperial oppression, e.g. Germany, then the infant Third International-affiliated communist parties threatened to replace the L&SI-affiliated social democratic parties. In France the PCF outgrew the SFIO. However, although growing in influence, until Hitler crushed all the opposition, the KPD did not overtake the SPD. Social democratic and official communist party competition continued. Sometimes, as in Great Britain, the Third International section, in this case the CPGB, whilst remaining a minority, related better than the social democrats to the most exploited and oppressed sections of the working class (e.g. Maerdy in South Wales, West Dunbartonshire’s Vale of Leven, the Fife coalfield, Chopwell in County Durham and East London).

xi.         However, the key area in which competition for working class support took place was the trade unions. The Third International set up Profintern in 1921. In France, Profintern was able to win over the largest section of the trade union movement, the CGT. In Germany, however, the continued drastic economic effects of the World War I defeat (e.g. the heavy cost of the imposed reparations) and then the Depression, as well as some bad political decisions, made it harder to increase the KPD’s influence in the trade union movement. The official communists increasingly recognised that outside those areas in which they enjoyed state control (the USSR before Second World War and Eastern Europe afterwards), they would have to adapt to official social democracy, particularly in the trade union arena. Profintern was closed down in 1937. Although the CPI emerged as the largest Left party in Italy after the Second World War, it pushed for the development of the CGIL, a new Italian trade union federation, to organise official communist, social democratic and Christian democratic trade unionists. The CGIL was set up in 1951.

xii.        Instead of building new unions or federations, or adopting an industrial republican approach and democratising the trade unions, the official communists pursued what was termed a Popular Frontist, or in its British trade union context a Broad Left approach. This involved allying with Left social democrats to replace the Right social democratic leaders of the existing trade unions, whilst largely leaving their bureaucratic structures intact. One of the weaknesses of this approach became evident, when new Broad Left candidates had to stand against old Broad Left officials, who had become bureaucratised in their outlook.

xiii.       However, it was the largely one-sided inter-imperialist competition, which emerged between the USA and the USSR in the Cold War period between 1947 and 1989  that  pushed official communism and a section of Left social democracy closer together. This had precedents in the pre-Second World War Popular Frontist politics, particularly Third International support for Leon Blum’s SFIO led French government (1936) and Juan Negrin’s PSOE participation in the Republican government of Spain (1936-9).

xiv.       During the Cold War, Right social democracy sided with the US state. Where any ‘Moscow’ sympathising Popular Frontism existed in national social democratic parties, trade unions and cultural organisations, the Right worked to break this connection. Every level of the US state was involved, including the CIA. What became known as an Atlanticist political orientation was promoted using US state funding, including money for US visits and other forms of ‘hospitality’. Against the Left, blacklisting and, political show trails were all resorted to in the USA and Western Europe; military coups elsewhere, including Greece in 1967.

xv.         There was even a Leftist version of this crusade against official communists and their supporters. This extended to some dissident communists, e.g. Max Schachtman and his followers from 1958. (Today the Alliance for Workers Liberty follow in this tradition.)

xvi.       Many Left social democrats though aligned themselves with the official communists. In the UK, there was a lot of shared thinking in the British Road to Socialism (published under Stalin in 1951, with further revisions in 1952, 1958, 1968 and 1977). An indication of the linkage was the CPGB’s support for Left social democrat, Tony Benn’s Alternative Economic Strategy (AES)(1976) based on the promotion of neo-Keynesian economics. The Broad Left in the trade unions pushed the AES at the same time as  its key leaders, Jack Jones and Hugh Scanlon, accepted the Labour government’s Social Contract.

xvii.      The Third International proved to be more attractive to those living in states subjected to western imperialism. Here, as a result of the imperial control and distortion of their economies, the working class usually formed small minorities. So, the Third International affiliated parties sought to represent the interests of other oppressed classes, particularly the peasantry. It abandoned the notion of international democratic revolution in favour of the building of what it saw as the preconditions for socialism. This meant further capitalist development but on the basis of national state protectionism, and making economic deals with the USSR. Thus, the Third International extended its appeals in these countries to those who wanted to form a would-be state capitalist class.

xviii.     International competition took place on the basis of whether the US or the USSR backed models offered the best roads for national economic development. The USSR-backed model proved particularly attractive to those  who held to a top-down bureaucratic managerialist ethos. These people considered it the duty of the workers and peasants to make sacrifices for further national development. Such sacrifices were rarely demanded of the leaders, who after they came to power, usually enjoyed extensive privileges.

xix.       Therefore, the period between 1923 and 1975 saw a trend to a coalescence of Left social democracy and official communism. This involved no revolutionary democratic vision of emancipation, liberation and self-determination, but a shared, top-down managerialist concern for greater state promoted economic development. There were differences over the balance between the degree of state control, from complete nationalisation and state direction of the economy to nationalisation of key strategic sectors and  state regulation of the economy. Official state-backed orthodox marxism justified the first, social democratic neo-Keynesians the second. There could be some overlap between the two.

xx.       Thus, the national state focus of pre-First World War social democracy was taken further by both later social democracy and official communism. This approach was justified as taking a national road to socialism. The next section will show that these roads did not lead to socialism but contributed instead to the latest phase of global imperialism, dominated by finance capital beyond the effective control of any national state.


d.        Social democracy and official communism morph into morphs into social neo- liberalism

i.           Both social democracy and official communism reached the highpoint of their influence in the prolonged post war boom. Their decline was also linked. Transnational corporations were increasingly able to escape the restrictions of national states and developed global institutions, particularly in the financial sector, e.g. IMF, to pressurise existing states to bow to their needs. Following the new global economic crisis, which developed from the mid 1970s, Thatcher’s Tories and Reagan’s Republicans launched their neo-liberal offensive through the 1980s. This succeeded in reversing many earlier social democratic and official communist inspired reforms, and led to an increasing accommodation by these two groups to this rising neo-liberalism.

ii.          In accommodating to this latest form of capitalism, and the sacrifices it demanded of the working class, Right social democracy gained ascendancy over its Left and Centre predecessors in the West. This slide to Right social democracy took place throughout the western world. In New Zealand it was the Labour Party under Finance Minister, Roger Douglas, which actually initiated neo-liberal restructuring in 1984. It took the experience of Thatcher’s Tories and the defeat of the miners, before a new social neo-liberalism became more entrenched in the British Labour Party.

iii.         Eurocommunism had developed in Italy, Spain and elsewhere in the 1970s. Eurocommunism represented a more dissident strain in relation to official communism, until official communism itself adopted Perestroika and Glasnost in the USSR to prop up the state and economy. There were similar Eurocommunist style developments in several Warsaw Pact states, e.g. Poland and Hungary (but they were still restrained by a slower moving USSR which remained in overall control). Had the USSR been able to survive, a version of Eurocommunism might have become the new official communism. The fact that Eurocommunism, which increasingly accommodated to existing western capitalism, inspired Perestroika and Glasnost in the USSR, highlighted the growing ascendancy of Western style social democracy over Eastern official communism. This in turn was a product of the growing accommodation of social democracy to the neo-liberal offensive.

iv.          The Party-states had also been stagnating for sometime. Key sectors of their economy had become dysfunctional. This was reflected in their low productivity rates as working class resistance, under police state conditions, took the form of, ‘If they pretend to pay us, we’ll pretend to work’. Political battles within these states took place over the degree to which the dominant state protectionism should give way to a new engagement with the global economy, with further marketisation of the economy and the legalisation of already extensive black markets.

v.          When the Party-states collapsed, their successor states abandoned the state protectionism, which had shielded then from the direct impact of the global economy. The capitalist economic relations already latent in these states were able to firmly establish themselves. There was no need to mount a bloody counter-revolution such as occurred after the 1871 Paris Commune, in order to remove the working class from power. It was the Party-state bureaucrats who had wielded power, and not the working class. Many former bureaucrats got their hands on the state property they had previously managed and gained their privileges from. They launched a  neo-liberal assault on jobs, pay and welfare provision. These attacks were similar to, but more brutal than those that occurred in the West with the support of Right social democrats. The levels of state protectionism in the old USSR and Eastern Europe had been considerably greater and these had to be removed for neo-liberalism to take root, however drastic the social effects.

vi.          In the aftermath of the collapse of the Warsaw Pact and USSR, many well placed former official communist party officials were able to make the transition to being individual capitalists, sometimes in league with new gangster capitalists. Together they opened up the Russian Federation’s state resources to foreign capitalists, aided by the ‘Chicago Boys’ – western finance capital’s own buccaneers. In the process, Boris Yeltsin ousted Mikhail Gorbachev. The latter’s policies of Perestroika and Glasnost, designed to reform the USSR, in order to maintain it, failed spectacularly in 1991. The post-1991 joint looting of the old USSR by a new kleptocracy led to a catastrophic decline in production, living standards, welfare provision and even life expectancy. But in the process a new class of capitalist oligarchs was forming.

vii.         Official communism had led to a particular form of economic development with its simultaneous  exploitation and oppression of workers and peasants, and its increase in the provision of education and skills training needed to speed up industrialisation. Eventually, the living standards of the working class in the Party-states did rise during the global post-war boom. Official communism’s main advantage over social democracy was that it enjoyed official state backing. When this ended between 1989-91, the official communist model collapsed.

viii.       Triumphalist neo-liberals highlighted the common statist approach shared by official communism and social democracy. They stepped up their offensive. Furthermore, since the official communists had used their state power to marginalise any genuine communism based on a vision of emancipation, liberation and self-determination, the Right was now able to say, “There is no alternative”.

ix.         But it was not a completely one-sided take-over. The major global corporations are usually  run, not by individual capitalists, but by professional managers, led by a CEO. They did take on board some of the managerialist techniques developed in the Party-states. Target setting for lower managers and an atomised workforce were borrowed from the Five Year Plans. New corporate plans were often launched before earlier ones had been completed, because the main function of planning was to impose managerial discipline. Glossy corporate brochures boasted of successes that were as far from the reality experienced by the workforce as the old Soviet Weekly.

x.          After the experience of Tiananmen Square, Peking, in 1989, the Chinese CP leadership decided the Party-state would have to preside over the transition from a heavily protectionist to a turbo-capitalist economy within the new world order. Under the CPC’s continued political domination, a new powerful capitalist class began to grow rapidly. The CPC opened up Special Economic Zones to transnational corporations, with the intention of massively increasing exports and to gain access to global financial markets in order to further investment. This created a new working class in the most advanced sectors of the global economy.

xi.         However, the attacks on welfare in China were even more draconian, the super-exploitation of labour even harsher, with internal controls over labour movement as brutal as much of the cross-border movement of labour to the EU and the USA. A segmented labour force was created, with an ever decreasing proportion being protected by the ‘Iron Bowl’, and an increasing proportion being dependent on balancing their existence between resort to precarious urban industrial employment and whatever support they could get from the rural communities they came from. Land in these communities has often been sold illegally, with the connivance of corrupt party officials, further weakening the working class, still dependent on subsistence produce and incomes from the rural villages. And beyond this there is an extensive semi-legal and black economy where ‘illegals’ are employed, including North Koreans fleeing repression.

xii.        Meanwhile, a further shift occurred in the meaning of social democracy under the Right. In the UK, the Labour Party first accommodated to the rise of Thatcher through the ‘dented shield’ policy of Centre social democrats under Michael Foot, Neil Kinnock and John Smith. After the defeat of the Miners’ Strike though, the political trajectory moved relentlessly further Right, until Tony Blair emerged as leader of New Labour. He ditched the Old Labour, Centre and Left social democratic Clause 4 pretensions.

xiii.      Following the earlier historically premature breakaway of the Social Democratic Party, which went on to merge with the Liberal Party, Blair talked about reintegrating the social democratic and liberal traditions. He began to investigate the possibility of state funding to marginalise the hold of the trade unions on the party. Which class actually Labour represented became decidedly vague, as Peter Mandelson declared, “He was extremely relaxed about people getting filthy rich”.

xiv.       Tony Blair, fully taking on board the earlier political degeneration of the term social democracy, went on to describe himself as a ‘social-ist’. This concept meant putting the word ‘social’, not only before democracy, by which he meant Westminster; but monarchy, hence his suggestion of the ‘Peoples Princess’; neo-liberalism, by which some of elite’s wealth might trickle down to the minions. As a social  imperialist  he took the UK into war with Iraq, by such ‘democratic’ means as sanctioning covert military actions before the war was officially declared, the use of the ‘Dodgy Dossier’, the sacking of journalist Andrew Gilligan from the BBC, and the ‘suicide’ of weapons expert, David Kelly.

xv.        Right social democrats did come into conflict with the neo-conservatives over the kind of society they wanted neo-liberal economics to create. Social democrats could support women, gay and LGBT and minority rights. However, the emphasis was on improving access to higher managerial jobs, providing niche consumer markets and seeking legal recognition within the existing order, not on drawing together the oppressed to create a wider vision of social possibilities based on emancipation, liberation and self-determination in its widest sense.

xvi.       Right social democracy’s abandonment of any commitment to the state other than to maximise the opportunities for corporate profitabilty in its particular national ‘branch’ of the global economy; to any particular commitment to the working class other than as individual consumers; to democracy other than the existing UK state and the use of focus groups to help make policy, led to the ditching of even the remotest prospect of a reformist alternative to existing society. Right social democracy  bought heavily into TINA, offering nothing more than ‘neo-liberalism with a human face’.

xvii.      Thus, instead of leading workers along their ‘national roads to socialism’, social democracy and official communism has dragged them into the dead end of neo-liberal integration into the world economy.


e.        From social liberalism to populism

i.        The most widespread political reaction across the globe to the regressive impact of neo-liberalism has been the rise of populism. Populist politics should not be conflated with popular politics. In popular politics, the well-organised sections of the working class use their power and influence to win support from the more marginal exploited and oppressed groups in society. Populist politics, however, reverses this. Particular charismatic leaders, anti-democratic movements or parties try to impose their views upon a marginalised, atomised and alienated working class, peasantry (where this still exists) and a downwardly mobile middle class. Populism also means mobilising on a national, cross-class basis. Thus populism, Left or Right, is always nationalist.

ii.         Populism can take root after particular defeats, in the context of the disintegration of class organisations – whether older social democratic, official communist or independent – which had previously provided the basis for gaining reforms or for resistance. Populism, instead of uniting workers and promoting class confidence from their own collective experience and organisation, turns to atomised individuals who look for saviours and scapegoats. They still crave collective identities – but these begin to take other alienated forms – nationalist, ethnic, ethno-religious, racist and male chauvinist – which break-up working class unity. Furthermore, the lack of an organised class-conscious pole of attraction means populism can oscillate between Left and Right.

iii.         As early victims of US imperialism’s and the IMF’s Structural Adjustment Programs imposed upon South America, a Left populist politics appeared in the form of Hugo Chavez’s proposed 2000 Bolivarian Revolution in Venezuela and Rafael Correa’s 2008 Citizens’ Revolution in Ecuador. More ambiguously, the vice president of Bolivia, self-styled Marxist, Alvaro Garcia Linera has termed Evo Morale’s post-2006 government, “Andean and Amazonian capitalism”, whilst Aymara Indian activist, Felipe Quispe, has termed it ~”neo-liberalism with an Indian face” [i]. This slippage along a Left/Right spectrum is characteristic of populism.

iv.          In the Russian Federation, neo-liberalism was imposed in such a brutal way, under Boris Yeltsin and the kleptocracy, between 1991-99, that a Right populist alternative emerged around Vladimir Putin. He was Depute Prime Minister under Yeltsin, before becoming President in 2000. However, to gain popularity he began challenging ‘unpatriotic’ elements amongst the rising class of oligarchs and their neo-liberal ‘excesses’. Putin centralised executive power into his hands, taking on both non-compliant oligarchs and any independently minded journalists. He had some killed. Putin acted as the political front man for the interests of one section of the Russian oligarchy.

v.           Even before the demise of the old USSR, a particularly virulent Great Russian chauvinist and right wing street politics had emerged in the form of Pamyat, under the protection of the KGB. Putin, an ex-KGB officer, based his Right populist politics in the revival Great Russian nationalism, Russian Orthodoxy and the promotion of very traditional social values.

vi.          Putin has made international overtures both on the Right and Left. He has backed Russian neo-fascist forces in Crimea and eastern Ukraine. Some from old official and dissident communist organisations have been prepared to form Red-Brown alliances with these forces. Although Putin clearly fronts a Russian capitalist state, he shares a Great Russian chauvinism with neo-Stalinists and a nostalgia for ‘Soviet’ pan-unionism with some Trotskyists. They see the Russian Federation as a victim of imperialism or western imperialism, rather than a declining imperial power, like the Spanish Empire in relation to a rising US imperialism in the nineteenth century. This, rather than uncritical support for ‘existing socialism’, which led to such earlier Red Brown alliances as the Molotov-Ribbentrop (or Hitler-Stalin) Pact from 1939-41, helps to explain, but not excuse such alliances.

vii.         Putin’s most consistent overtures have been to the Far Right in Europe – Golden Dawn in Greece, Attak in Bulgaria, Jobbik in Hungary, Northern League in Italy and Front National in France. He has recognised fellow Right populists in Farage and Trump. However, the Russian state-backed Russia Today in the UK is more designed to appeal to Left populists. Some overtures, like his attempt to woo the SNP led government in Scotland have not worked because, although Scottish independence was opposed between 2012-14 by the UK, US governments and leading EU bureaucrats, the SNP has remained Atlanticist and become openly pro-NATO and is pro-EU. Putin and his oligarchic backers see the EU as an economic threat to Russian interests, and its lack of an independent military force, as making it subordinate to NATO’s policy of encirclement of the Russian Federation.

viii.       The full impact of neo-liberalism only became obvious in the EU, including the UK, during the 2007-8 Financial Crash. This has led to a prolonged recession.   Many of neo-liberalism’s leading proponents were initially shell-shocked. Gordon Brown, who as UK Chancellor, abolished any remaining government regulation of the City of London in 1997, had been claiming for a number of years that the old boom and bust days were over. He fully accepted the economic basis of neo-liberal economic thinking, but opposed its ‘excesses’. Under New Labour, neo-liberalism could be made to work for the majority of the British people, including its working class, through the trickle down of the wealth ‘created’ by a turbo-charged global economy. He joined the massive Make History Poverty demonstration in Edinburgh in 2005, coinciding with the G8 conference at Gleneagles. In a throwback to old nineteenth century Christian moralism and pacifism, this protest was made to bring about a change in the consciences of global capitalists. They remained unmoved.

ix.        In 2008, following the Crash, Alan Greenspan, Chair of the US Federal Reserve and arch-advocate of finance capital-led neo-liberalism declared, “I have found a flaw. I don’t know how significant or permanent it is. But I have been very distressed by that fact [ii]“. Traditionally, it has been thought that it would be the Left that would highlight and take advantage of any major crisis of the capitalist system. However, one effect of a serious crisis is to provide new opportunities for some capitalists – “Never let a good crisis go to waste”.

x.         When the post 2007/8 economic crisis hit the EU, the Troika (IMF, European Central Bank-ECB and European Commission – EC) resorted to an updated version of the Structural Adjustment Programmes previously imposed upon the ‘Third World’. In the EU, they demanded that the exploited and oppressed should pay the banksters’ debts. In the process, the EU’s southern tier – Greece, Italy, Spain to Portugal, plus Ireland (which was done over by both the EU and The City) – were the worst hit.

xi.        In 2011, a year of mounting resistance across the world (from the massive Arab Spring to the student demonstration in London and the Hetherington occupation at Glasgow University) two new movementist organisations appeared in the EU – Direct Democracy Now in Greece and the Indignados in Spain. Initially though, the movement with the most international clout was Occupy. This was launched in the very heart of the beast – New York’s Wall Street. Occupy, which celebrated its own spontaneous nature, was to rapidly rise and fall. However, in the context of even deeper crisis in Greece and Spain, many of those who had been involved in Direct Democracy Now and the Indignados saw the need for a specific political challenge.

xii.       Therefore, in both Greece and Spain, new Left populist and electoral organisations arose – Syriza and Podemos. Both claimed inspiration from Venezuela. However, they have been more circumspect in any resort to revolutionary talk than Chavez. They both accepted their existing state frameworks as an adequate vehicle to begin their challenge. Two charismatic leaders came to the fore – Alex Tspiras in Greece and Pablo Iglesias in Spain. Under the guise of marginalising the sects (whose behaviour usually alienated many), these two individuals increasingly concentrated real power in a leadership built around themselves.

xiii.       Syriza’s Finance Minister, Yanis Varoufakis, who describes himself as an ”erratic marxist” was quite clear about why he adopted Left populism. This was done to “save European capitalism from itself…. Not out of love for European capitalism, for the eurozone, for Brussels, or for the European Central Bank, but just because we want to minimise the unnecessary human toll from this crisis”. “I have campaigned on an agenda founded on the assumption that the left was, and remains, squarely defeated”. The link between populism and Left defeat could not be clearer.

xiv.       Furthermore, Varoufakis went on to recognise the negative historical role of “the communist and social democratic parties. Both of them, in addition to their other errors (and, indeed, crimes) failed, to their detriment, to follow Marx’s lead in a crucial regard: instead of embracing liberty and rationality as their rallying cries and organising concepts, they opted for equality and justice, bequeathing the concept of freedom to the neoliberals. Marx was adamant: The problem with capitalism is not that it is unfair but that it is irrational, as it habitually condemns whole generations to deprivation and unemployment and even turns capitalists into angst-ridden automata, living in permanent fear that unless they commodify their fellow humans fully so as to serve capital accumulation more efficiently, they will cease to be capitalists. So, if capitalism appears unjust this is because it enslaves everyone; it wastes human and natural resources; the same production line that pumps out remarkable gizmos and untold wealth, also produces deep unhappiness and crises [iii]“.

xv.        There is real substance to Varoufakis’s criticism of the “left for failing to put forward a vision embracing liberty… and bequeathing the concept of freedom to the neo-liberals [iv]“. Varoufakis stated that he has “been accused, by well-meaning radical voices, of being ‘defeatist’ and of trying to save an indefensible European socio-economic system. This criticism, I confess,  hurts. And it hurts because it contains more than a kernel of truth [v].” However, it also needs to be recognised that Varoufakis’s criticism of the Left itself contains more than “a kernel of truth”, even if it hurts.

xvi.        Nevertheless, in abandoning the bureaucratic politics of traditional social democracy and official communism and the sectarian politics of dissident communism, what alternative economic course did Varoufakis advocate, to save European capitalism from itself, and to prevent a slide to the Far Right? Populism has no distinct economic programme of its own, so Syriza borrowed heavily from the Left social democratic neo-Keynesianism. George Papandreou, leader of Greece’s mainstream social democratic party, PASOK, had abandoned this course. On occasions Papandreou had not been averse to making his own Left populist appeals. He won the 2009 election on the basis of challenging austerity (just as Francois Hollande’s social democratic PSF did in 2012, with a programme similar to Corbyn’s). Yet, within months, Papandreou was imposing the EU’s drastic austerity package, without mounting any opposition (as Hollande was to do too).

xvii.        Syriza aimed for government office in the belief that it could persuade the European capitalist class to act in its own best longer-term interests (a somewhat Lefter version of Gordon Brown’s ‘Make Poverty History’ thinking). However, the European capitalists’ representatives in the ECB were not operating in an international vacuum. The post 2007/8 crisis had placed the EU in increasing economic competition with the US and China. This was a time to batten down the hatches of the EU Megacorp, and not encourage any of its ‘branch offices’ to come up with alternative experiments. This could only lead to the undermining of the centralised financial power of the ECB, the coordinator of the European capitalist response to the global crisis it found itself in. Furthermore, the US under Obama, the UK under Brown and Cameron were already to the forefront of making their working class’s pay for the crisis, so the ECB, backed by the EC, were not going to follow a neo-Keynesian course, which could lead to global financial and speculative attacks on the euro.

xviii.       When Left populist Syriza took office in 2015, it formed a coalition with the Right populist ANEL. This again highlights the ability of populism to behave in a chameleon like fashion. Although Syriza belongs to the European Left and its parliamentary group GUE/NGL, Prime Minister Tspiras was aware that its internationalism was largely sentimental. Its leaders much preferred diplomacy behind the scenes to taking the lead in organising effective international solidarity. He also knew that the Greek Communist Party’s (KKE) sect international – the Initiative of Communist and Workers’ Parties [vi] – and those of Antarsaya [vii] (a coalition of several sects including the Greek section of the USFI and IST ) – were unable to provide any effective solidarity for their alternative Grexit policy. This is why, on the international plane, Tspiras turned to Putin, the Right populist leader of the Russian Federation, for an ally to help him deal with the Troika. Putin, however, hedged his bets, and also made overtures, on a pan-Orthodox basis, to the Greek fascist Golden Dawn.

xix.       There is a strong likelihood that Tspiras, knowing that his Syriza/ANEL coalition only enjoyed 40% electoral backing [viii], conducted his Greek bailout referendum on 5th July 2125, in the expectation that he would only get minority backing for defiance. This would provide Syriza with the excuse Tspiras was looking for to back off. However, the Greek people gave a defiant 61% ‘Oxi’ (No) vote to the deal the ECB was trying to impose. Therefore, when Tspiras capitulated, three days later, the limitations of national populist challenges to corporate capital became very apparent. A gloating ECB was able to impose an even harsher austerity package than the one the Greek people had rejected.

xx.        Unable to offer the Greek people any practical alternative, which would have required effective international solidarity, neither the KKE nor Antarsya made any breakthrough in Tsipras’ rushed September 2015 election. Syriza, despite a fall in its vote, held on to office [ix]. The increased abstention rate and the rise in the vote for Golden Dawn was an indication of the politics of demoralisation. The mainstream Greek parties did not mind Syriza carrying the can for the ECB’s austerity measures. Now that the Syriza/ANEL coalition has become directly responsible for implementing these (including pensions cuts and more privatisations), the neo-fascism of Golden Dawn could further benefit.

xxi.     However, the impact of the crisis struck even closer to the centres of corporate power – in the UK and US. Although the ‘1%’ appeared to be out on a limb politically, crises that downgrade the economic and hence political clout of some players also raise the prospects for others. And some of these new players are extremely ambitious. This has meant that those, less obviously linked to the existing state institutions and mainstream parties, were in a better position to seize the new opportunities presented to them. Hedge funds owners and managers, e.g. BlackRock and Ray Dalio [x], and certain major companies, e.g. Uber, Coors appreciated this. They financed Donald Trump’s presidential bid. Trump, himself a major corporate business owner, could attack the Washington establishment, and its prime political representative, Hilary Clinton. She was so obviously in the pockets of major US corporations. Billionaire Trump could claim he did not need to bribe any government. He could miss out the middle {wo}man and bring his ‘successful’ business skills directly to government. He knew that Clinton would not want to run her campaign on the ethics of big business!

xxii.     It was Trump’s personal wealth (and that of his wealthy backers), coupled to his political outsider status, which gave him a decided advantage when appealing to the workers in the rust-belt communities. They had faced decades of industrial decline, the loss of skilled work, increasingly precarious labour, and removal of much of what was already weak welfare support. They now confronted the world as atomised and alienated individuals, with whatever support they received often coming from fundamentalist evangelist churches. The National Rifle Association, and Far Right organisations like the KKK and various militias also operated in this milieu.

xxiii.    Few workers in the rust belt any longer had independent class organisations of their own. Now far more atomised, they had been ‘groomed’ for decades to think only individually, through watching highly competitive TV games shows at home, and to look to celebrities as role models. The major TV channels, NBC, Fox News and CNN were overwhelmingly pro-corporate America. However, they became outflanked by a whole online media world, which encouraged audience participation. This increased the possibility of drawing people into supporting new celebrity politicians. Trump was already well known as the US producer of The Apprentice. So he straddled the two worlds of commercial TV and the massive online world of Twitter. This was a world that his AltRight backers had also colonised, through such outlets as Breibart.

xxiv.     Too much focus, though, on the role of the hard Right can draw attention away from the fact it was the economic conditions and hyper-individualism promoted under neo-liberalism that allowed this new political phenomenon to grow. No matter how unsavoury Trump’s ‘America First’ appeared to the Old Guard of Democrats and Republicans, he represents a ‘blowback’ consequence of their own neo-liberalism.

xxv.      Trump’s supporters also saw Brexit as a possible dry run for their US ambitions. Thus Robert Mercer, hedge fund billionaire and co-owner of Breitbart, provided free backing for Nigel Farage [xi]. But one-time City trader, Farage did not have the same economic muscle as Trump, and only had the support of a few wealthy business figures, like Arron Banks. But Brexit also had another parallel campaign, with far more significant backers on the Tory Right. Once the vote for Brexit had been won, Trump would go on to his own “Brexit, plus, plus, plus” victory. Having seen Theresa May adopt Brexit, he tried to get her to make Farage the UK ambassador to the US. The British ruling class could accept the Tories donning much of UKIP’s clothes, but not its erratic leader or its other prominent and unpredictable figures. Trump could see the lie of the land and got May to meet him in the Oval Office, to plan for his ‘America First’ US-UK ‘free trade’ deal.

xxvi.     This, in turn, is the immediate political context in which Jeremy Corbyn and British Left social democratic politics have emerged. Therefore, it is not surprising that some of his closest political advisors are calling upon Corbyn to adopt a specifically Left populist politics, which ramps up the British nationalism already inherent in social democracy. Independent working class organisation, whether industrial or communal, is currently weak, but a national statist politics can draw support across a wider Left/Right political spectrum.

xxvii.    Leading trade union bureaucrats welcome the prospect of increased power, after years of their marginalisation under neo-liberalism and Right social democracy. In return for trying to persuade their members (but not themselves of course) to make the necessary ‘sacrifices’ to prop up a Corbyn-led government, they expect to be given a much more central role in the running of the UK state. All of McCluskey’s years of political manoeuvring in the TUC and Labour Party could yet bear fruit for him. May Day ‘socialist’ rhetoric aside his political vision represents an extension of the best deal he thinks that a trade union bureaucrat can deliver at any particular time. His ‘socialism’ is designed to come about through an accumulation of good deals, which improve everyone’s pay, conditions and welfare provision. So collective bargaining needs to be supplemented by neo-Keynesian state regulation.

xxviii.   But the overwhelming weakness of this revived Left social democratic economics is that it ignores the massive pressures exerted on the competing nation-based capitalist classes, particularly in a period of continued economic crisis. Keynesian measures may be able to iron out short term cyclical movements in the economy, during a prolonged period of overall growth. However, once the rate of profit has slowed down due to the prolonged post-war build up of vast amounts of capital, then neo-Keynesian measures threaten corporate profits even more, particularly in the context of growing inter-imperialist rivalry. No national capitalist class is prepared to make the sacrifices demanded of them in the name of ‘the many not the few’, because their international competitors will go for the jugular to try to eliminate or subordinate them to their interests.

xxix.     Furthermore, the UK state, which the British Left social democrats hold to be the vehicle for their neo-Keynesian reforms, has been developed over the centuries to best meet the interests of the few and not the many. The Crown Powers serve the British ruling class. This is why any sustainable challenge to the existing global corporate order, and its local centres of accumulated power, involves the development of a party and international advocating revolutionary democracy and independent working class organisation.







[iv]    ibid.

[v]     ibid.



[viii]  The Greek electoral system gives a parliamentary representative boost to the leading party.

[ix]    However, Tsipiras had to sack one of his ANEL coalition ministers, Dimitris Kammenos, because of his anti-semitism –




  • A comment on dvi – ‘Chicago Boys or ‘Harvard Boys’?

    The “shock therapy” of the former Soviet bloc, and formation of the Russian federation was carried out under the administration of President Boris Yeltsin. Directing privatization however, was deputy prime minister for economic and financial policy, Anatoly Chubais, who The New York Times once referred to as “the most despised man in Russia.”

    Cozy with the U.S. Clinton administration, Chubais was instrumental in giving control of Russia’s economic policy to the Harvard Institute for International Development (HIID), which had originally arisen out of the Harvard Center for International Affairs, founded by Henry Kissinger and known for its close relationship with the CIA and FBI. In the 1990s, the HIID consisted of an ideologically driven group of economists eager to apply their neoliberal credentials to what was once the world’s then largest socialist economy.

    The sale of Russia was first devised in a villa outside Moscow in the final years of the Soviet Union, when Harvard economist and HIID director Jeffrey Sachs met with Chubais and a small pro-Yeltsin clique. The team devised their plan to eliminate nearly all price controls and subsidies, and privatize all key industries in a very short time-span.

    Later, at Chubais’ urging following the dissolution of the Union, the U.S. Agency for International Development, or USAID, was tasked with the “reform” of the fledgling Federation’s economy, and delegated that authority to the HIID.

    And so it came to be that a few Harvard professors, at the behest of USAID, became the architects of post-Soviet Russia.

    The “Harvard Boys,” as they came to be known as (perhaps a play off of the “Chicago Boys” that privatized Chile), included “shock therapy” theorist Jeffrey Sachs, former World Bank Chief Economist Lawrence Summers, and Harvard economists Andrei Shleifer and Jonathan Hay.

    Hay and Shleifer would later be fired and sued for using USAID money for personal gain. In spite of the scandal, Shleifer teaches economics at Harvard to this day.

    Shock therapy proved to be a “shock” indeed. Commodity prices went up by 2,500 percent within a single year due to hyperinflation. Although the inflation stabled out (temporarily), the damage was done, and numerous people had been pushed into poverty, while an oligarch class was rising to wealth and power.

    Chubais implemented a voucher program to alleviate the worst of privatization, originally conceived of in an academic paper by Shleifer. The program entailed providing a “voucher” of roughly 10,000 ruble shares in formerly public companies to each citizen. However, the fact that the most profitable industries, including oil, gas, and metal, were excluded from the program, paired with extremely high inflation, quickly led to the vouchers becoming worthless.

    Financial scams involving the vouchers quickly further complicated the program, leading many to sell off their “shares” for practically nothing, getting perhaps a bottle of Vodka or some groceries in exchange.

    Chubais and the HIID were able to operate by using foreign money to establish private, non-governmental organizations that could bypass parliament, most notably the Russian Privatization Center, which carried out government policy and directed privatization processes. It had the power and authority of a government agency, but was not accountable to parliament or officials, being run directly by Chubais and the Harvard Boys. Hundreds of millions of dollars flowed into Russia from USAID, the World Bank, and the European Union, to prop up the NGOs carrying out privatization.

    Western aid money provided the funds to construct an oligarchy. Quoted in a 1998 report by The Nation, the USAID coordinator for the former Soviet Union, Richard Morningstar, admits this: “If we hadn’t been there to provide funding to Chubais, could we have won the battle to carry out privatization? Probably not.”

    By the end of Yeltsin’s first term, Yeltsin’s popularity had plummeted to the single digits, and Chubais and his clan were implicated in a massive corruption scandal for awarding bribes and privileges and using funds for personal profit. Yeltsin in response, fired several officials, but still kept Chubais on, claiming his departure would “destabilize the situation.”

    from –