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'Managed Decline' was the advice of Thatcher's Chancellor for Liverpool after the riots in 1981. David Jamieson argues that this is a good description for the way Britain is heading in 2012.

Toxteth riots 2011

The media world seems to be bracing itself for the demise of Margaret Thatcher some time in the New Year. 2012 will open with what is expected to be a soft hearted portrayal of Thatcher in power and then senility – Meryl Streep’s ‘Iron Lady’. This has been preceded by the revelations that following the riots in Toxteth, Liverpool in 1981 (pictured) Thatcher’s Chancellor Lord Howe advised a programme of ‘managed decline’ for the suffering city. We can expect that, as the wicked creature dangles between this world and dubious posterity, more such revelations will appear.

The Liverpool story will probably shock no one who lived through Thatcher’s years in office, nor those who have not but must suffer her progeny today. There’s something deeply nihilistic about British conservatism. To be sure – the Tories' repeated offensives against working class society, especially in the latter half of the 20th century – were about restructuring the British economy and class relations in a way useful to the British ruling class. But the practice of this class strategy involves mobilising the reckless contempt of the Tory right. The black youths are dissenting? Let their community rot. The Unions won’t comply? Smash up industry. Women won’t vote for us? Cut their welfare. That’s the drum that beats for a populist conservatism – an ideology born of the long decline of Britain as a world force.

Its most recent victim has been Britain’s diplomatic and, by extension, economic relationship with Europe. In December Cameron chose to exercise his veto and keep Britain out of a new EU treaty. He did so primarily, by his own admission, to protect British finance capital from proposed regulation. The operation of British Finance has long been contentious in Europe; countries with smaller, less concentrated banking sectors fearing predatory British corporate finance and seeking regulation. Up until now Britain has successfully protected the city – with financial services escaping European ‘harmonization’ in a way that transport, for instance, has not.

But British manufacturing and other industry are pissing blood over the veto and Britain’s subsequent estrangement from the European community. The EU represents by far the largest market for UK exports, yet Britain can no longer depend upon a say on the many formative economic dilemmas facing the continent. The Tory right, which made abortive early attempts to force the issue and break Britain further from the EU, has no back-up plan for Britain’s economy and international position post such a rupture. It’s often assumed that the Tory right simply favour a retrenchment into an even closer partnership with the U.S. But this is not necessarily the case. The ideological backdrop to the hard right is ‘glorious isolation’ – theirs is a fevered mind that wants for the return of old Britannia so badly that they almost believe the mirage. The real world is heading in the opposite direction.

The Crisis of the British Regime

No one should underestimate the damage this has done to the coalition government. Rather than recognise the luck they have in being able to shield themselves, to some extent, from public discontent by way of the liberal democrats, the Tory backbench plot endlessly against their coalition partners. The effect has been to morph the Liberals into a self-conscious and embattled faction of government. Limited though they are by a lack of leadership and coherence, the Liberals will choose their moment to counter attack – they have little to lose by audacious behaviour. The nature of the coalition remains a handicap for the Tories for other reasons – chiefly it has further discredited the parliamentary process. The intensity of student anger in the last year emerged to a great extent from estrangement from the Lib Dems, who a significant layer of politically conscious young people saw as the last roll of the parliamentary dice since Labour went renegade. The tuition fees debacle made concrete what many young people already suspected – that no one in establishment circles can represent them or anyone with a broadly progressive political agenda. All of this has further reinforced an already prevalent mood that stipulates only extra-parliamentary politics as legitimate.

Neither should anyone underestimate the encroaching horizon of the independence debate in Scotland. Britain’s apparently growing distance from Europe, as well as the crisis of the Euro zone, has profound implications for Scotland, its constitutional future and the SNP. A traditionally popular angle for Scottish Nationalism was that Scotland’s secession from the UK would be concomitant with a more profound integration in the E.U, and possibly the replacement of sterling with the Euro. That seems unlikely and Scottish Labour will try to pressurise the SNP over the issue of currency – and other issues pertaining to the viability of an independent Scotland in Europe’s choppy waters. Yet the new Labour leadership will be restrained by the one clear lesson that has emerged from both the Scottish elections and Labour’s subsequent leadership contest – that negative campaigning, especially over the independence question, doesn’t work.

The stronger hand in upcoming debates around independence is likely to be the continued deterioration of Scotland’s economy. The Latest Lloyds TSB Scotland business monitor presents Scotland’s economy as suffering little short of recession in the last quarter of 2011 to November, with the service sector in particular hit by below expected turnover, and Scotland’s exports hit by the crisis in the Euro zone. The same report predicts a worsening situation into the new year. It is very likely that blame for this will be attributed to the Westminster government’s high profile austerity measures rather than – as Labour hope – to the Scottish administration; whose enduring case will be the reduction by a third to Scotland’s capital budget. This gives the Nationalists the perfect backdrop to argue for, at the very least, devolution max. What that maximum will represent in terms of the transfer of powers will likely remain unknown until well into the referendum game; the SNP know how to keep their cards close.

From the International Socialist Group (Scotland) website

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