Invest in Steel, For a New Direction for the Economy!
Steel production in Britain suffered a further blow on January 20 with the announcement of the loss of 100 jobs at Sheffield Forgemasters.
Two days earlier, the monopoly Tata cut 1,050 jobs, three quarters in Port Talbot, south Wales, along with Trostre in Llanelli, Hartlepool in north east England and Corby, Northamptonshire. That comes on top of 1,200 redundancies made by Tata in October in Scunthorpe and Lanarkshire.
That in turn came in wake of Caparo going into administration, and the previous month’s closure of the SSI works at Redcar, with 2,200 jobs lost.
So far, 5,000 jobs in the industry have been destroyed over the past year out of 30,000. This will cost the communities affected dearly in lost productive capacity, removing vast sums of value in the form of wages from local economies, further decimating whole towns and communities, and deepening the crisis in the British economy in general.
Unite assistant general secretary for manufacturing Tony Burke said on January 12: “These figures are deeply worrying and show that George Osborne’s promise to rebalance the economy is becoming an ever distant pipe-dream.”
“As we saw with closure of the steel works in Redcar, the government’s laissez faire approach damages communities and strips out decent well paid jobs from the economy,” he said. “With steel communities across the UK facing uncertainty and as the storm clouds grow in the global economy we urge the government to adopt an active industrial strategy with steel at its heart.”
A modern socialised economy, with its interconnected large-scale production, comes into contradiction with the private ownership of the means of production. When looked at with a human-centred perspective, with the aim of meeting the material and cultural needs of the population, these conditions pose as a matter of necessity the development of sovereign, self-reliant national economies that trade with each other for mutual benefit. This is the opposite of the motivation of the economy of Britain, taken as a whole, in which parasitism, the urge for a quick score, and competition in the global economy hold sway.
It is clear that an economy cannot be built to ensure the claims of society on it without a manufacturing base, which requires basic materials such as steel. There is still a huge requirement for steel and this will continue into the foreseeable future. Even where steel is being replaced by new materials, such as certain components in vehicle manufacture which are now made of carbon fibre, steel is still ubiquitous, not least in machinery and infrastructure. Steel remains a basic necessity for the functioning of the economy.
After writing off Redcar, Industry and Business Minister Anna Soubry said that “the priority is securing Port Talbot and making sure that Scunthorpe survives”. Only recently, she led the Conservative counter-argument in the House of Commons debate of January 13 on trade, that there is too much steel on the market and that the opposition should “get real”. The reasons put were that it would be loss-making, asking why anyone would invest. The whole point of steel’s significance for the present and future economy was either missed or dismissed.
This narrow market-led view is promoted by media pundits. Reporting on the redundancies at Port Talbot, for example, the BBC claim that the British steel industry is struggling to be “competitive”. “But it is fighting against global forces including cheap imports from China,” wrote business correspondent Brian Meechan. “The steel industry has not really recovered from the financial crash in 2008 when at its height people stopped buying white goods, cars, and construction stopped.”
These are markets dominated by the monopoles, and also under the sway of massive speculation and manipulation. They are experiencing all kinds of chaotic movements, particularly in this time of extended crisis. These problems in the prices of commodities and currencies are also used for various ends in world politics, to accuse and isolate particular countries, enact protectionist measures as part of trade wars and so on, further contributing to disequilibrium.
The European Union of the monopolies is also responsible, since its origins and preliminary organisations like the Common Market and Iron and Steel Trades Federation were based on control of strategic European steel production. The EU is against sovereign countries and economies from developing their self-reliant balanced economies. It prefers balancing to be carried out across the EU and dominated in a one-sided manner, in particular by the strongest economies like Germany, France and Britain. With this aim, EU regulations have long prevented governments from propping-up “ailing” or unprofitable industry, regardless of how vital they are.
Furthermore, it should be remembered that the destruction of the coal and steel industries began in earnest with the rise of neo-liberalism in the days of Margaret Thatcher. The so-called “laissez-faire” of neo-liberalism meant the unbridled rule of the monopolies. Under Thatcher, in fact, the interests of the national economy were over-ruled, despite all the chauvinism associated with her and her ideology.
Osborne promised a “balanced” economy. What would this mean? First of all, a “balanced” economy would have to be human-centred. There must be planned control of market prices and planning over all aspects of international trade. This means restricting the monopolies who already exert such power for their private empire-building interests.
A harmonious economy cannot come about if the economy is fragmented into mutually antagonistic, competing parts. Association has to supersede competition. In other words, instead of anarchy, competition and being subject to the market, human, conscious control over the economy is required, meaning planning, with the aim of meeting the needs of the population. Instead a completely different direction is evident in the monopoly-controlled economy which bears all the hall-marks of the domination of private interests, of irrationality and the demand that everything must serve to counter the falling rate of profit.
This is summed up in the need for a change in direction, for an economy where the steel industry is an integral part of the social economy. In the immediate present, the government must be held to account for its wilful failure to safeguard the steel industry. The proletarian front, led by the Workers’ Opposition, must fight to safeguard the future of the steel industry and the whole manufacturing base. It must do this by strengthening its organised resistance to the wrecking of the economy by the ruling elite. This organised resistance gives rise to a glimpse of the future in which the people themselves gain sovereign control of their economy in general and the steel industry in particular.
The government must be held to account over its refusal to accept its responsibility to safeguard the future of the industry. The crisis in manufacturing underlines the necessity for the working class to develop its independent programme and action to bring about a sovereign economy under its control and end the parasitism of the monopolies and financial oligarchy. To take steps in this direction, monopoly right must be restricted and a fight take place for a new direction for the economy.