A crisis which only the working class can resolve

3 September 2020

As this year’s “non”-holiday season comes to an end - because there was no real holiday for most workers - Boris Johnson is exhorting everyone to get back to work as soon as possible... and never mind the virus or threat of a second wave.

    But in fact, as of the middle of August, only around 16% of workers were still officially on furlough. Most are already back, that is, those who still have work. Because an estimated 750,000 jobs have been cut since the beginning of the Covid-19 crisis. And as we all know, the economy is officially in “recession” with a huge, 20% drop in GDP registered in June.

    Without doubt, worse is yet to come, as many more companies decide to cut jobs and force fewer workers to take on more tasks, under the pretext of this Covid-crisis.

    However, unlike workers, the bosses have been well-compensated throughout. Every government among the rich counties stepped in quickly to offer hand-outs and loans - and in the case of Johnson’s government, not only did it do what the other EU countries did, but it created a whole new raft of private contracts, awarded to companies to “consult over” and “manage” the pandemic!

Money for old rope

So, out of Sunak’s £190bn of public spending, so far, plus the extra £30bn pledged in July, much of which was handed to the bosses in the forms of loans, subsidies and furlough handouts, additional millions have been lavished on the likes of government favourites, PwC, Deloitte and McKinsey.

    The amount - £109m for 106 contracts, which is probably just the tip of the iceberg - has only just come to light. It was kept secret, against the government’s own transparency rules for the past 3 months. And no wonder, given the utter ineptitude shown by these so-called experts when it came to managing the provision of PPE, testing, contact tracing and all the other vital work handed over to them!

    Yes, these “intermediaries” are employed solely in order to provide lucrative profits, courtesy of the government, to their shareholders. They have little or no expertise to offer - especially not when it comes to controlling a lethal pandemic. They could, in fact, be completely dispensed with. In fact it might well be a matter of public safety, let alone saving millions, to do so!

    Their ineptitude was proven during the latest local outbreaks of Covid-19 in Leicester and Blackburn, when Serco contractors (engaged by Deloitte) proved totally incapable of finding anybody who had been infected. And where effective contact tracing was achieved in the end through footwork and face-to face visits by experienced local public health workers on the ground, bypassing the government’s “track and trace” completely...

    So one can only wonder what a company like London firm “Consulting”, owned by private equity group Carlyle, actually did in practice, to justify the four contracts worth £18.3m given to it, to “advise” on the Ventilator Challenge project?

    Or what MullenLowe did, to justify the six-month contract worth £16m it was awarded for its cheap coronavirus advertising campaigns, which included the national “stay at home” message at the peak of the pandemic?

More tax needed, maybe, but from whom?

Yes, the government has splashed out money here, there and everywhere amongst its City friends and what’s more, without providing the least justification. And yet now the message it is promoting is that all of its public borrowing will have to be paid for.

    So there is much discussion about raising tax rates, even though Sunak’s “Autumn Budget”, is now possibly delayed until Spring 2021, due to a likely second Covid wave this November - and the possible need for another lock-down.

    So who should pay? According to the Financial Times (and it should know), Sunak is planning “a £30bn hit on the wealthy, pensions and companies”.

    The rumour circulating in Tory circles - and causing MPs to tear their hair out, is that he might raise corporation tax from the all-time low of 19% to 24%, and also increase capital gains tax. In answer to those who accuse Sunak of following Labour’s 2019 manifesto pledges, he says that this will be temporary. Maybe so. But the shrinkage of the British economy and the financial black hole caused by the joint efforts of Sars-CoV-2 and capitalism, will be permanent.

    And Brexit won’t help. In fact this isn’t a problem which any government under this system can fix. It’s something only the working class, organised in its own revolutionary party, will have the means to resolve. The task of building such a party has seldom been so urgent!