Workers Must Challenge the Rich’s First Claim on the Social Product

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Workers Must Challenge the Rich’s First Claim on the Social Product

How are available funds decided on by the government which then are the subject of its budget? Let us first look at two items of news for Monday, March 1.

Over 50 schools in the London borough of Croydon were closed at lunchtime on March 1, as members of the National Union of Teachers staged a half day strike against threatened job losses of 160 teaching and support staff. The threatened cuts reflect the financial crisis facing the Croydon Local Education Authority (LEA), which has said that an additional £6 million is needed for the financial year from April 2004 in order to achieve the government target of increasing the spending on each school by 4%.   In the light of these financial difficulties, a spokesperson for the Croydon LEA said the Authority anticipated that some 20 schools would face deficits in the coming financial year and demands have been raised that the council should dramatically increase the council tax in order to cover the shortfall.

            The teachers' strike in opposition to the proposed cuts met with all-round support from local parents and children, who joined a rally outside the town hall in their hundreds.  Children shouted such slogans as "No ifs, no buts, no education cuts" and parents voiced their opposition to the growing crisis in the education system. One mother pointed out that her children's school had seen an increase in class sizes, and an end to buying books and she wanted to support her children's teachers who were striking to protect standards in their schools. At the same time there is growing unease among wide sections of people, especially pensioners, that proposed council tax increases for the coming financial year will drive them even deeper into poverty.

            Also on March 1, HSBC Holdings Plc, a huge international financial conglomerate registered in London and Hong Kong, announced record profits for the financial year ending in December 2003. HSBC's announcement of £6.89 billion in pre tax profits for 2003 represented a 33% increase on its 2002 figures and was the largest ever reported profit of a British bank, outstripping the £6.16 billion in pre tax profits announced by the Royal Bank of Scotland in the middle of February. HSBC, which has a workforce of 230,000 and operates in 79 countries, has a share issue of 10.9 billion shares, owned by some 190,00 shareholders in 100 countries.

            In the light of its 2003 profits, HSBC proposed a dividend payment of 32p per share, an increase of 13 % on the previous year. Through this mechanism some £3.5 billion of the world's wealth is siphoned off to the financial oligarchy.

            These two incidents highlight key issues for the workers and people over the social product and who should have first claim on it. In the first place, it is clear that the movement of wealth from the country in which it was created so that it can be consumed elsewhere is theft and should be outlawed. The workers cannot accept the idea that the wealth produced by their brothers and sisters in one country can simply be stolen and transported elsewhere for consumption. Secondly, it raises the issue of who should have first claim on the wealth produced by the labour of the people in Britain.

            It is essential that the workers should challenge that the social product produced by the application of their labour should be first applied to the claims of the rich. The workers cannot accept the logic provided by the government on the question of funding for social programmes on the one hand, and the justifications that massive profits are needed on the other from which the government of the day takes a certain share in the form of taxation. This logic covers over that the government’s revenue is a slice of the social product produced by the application of living human labour. Workers must seriously investigate and discuss this question, how the government decides on its revenue which is then the subject of its budget. Not to seriously investigate allows the government to get away with its claim that it is faced with “hard choices”, that there is only so much funding available for social programmes. How are the funds available to the government decided? Is it nothing more than taking a fraction of the “profits” which the capitalists and the banks claim as theirs? Can the main bone of contention be the level of personal income tax? Why should salaries and wages be taxed at all? That there can be a lack of funding for the people’s essential claims while the claims on the rich are made sacrosanct cannot be accepted.