THE ECONOMIC SITUATION
The key thing in the economic situation of the capitalist world is the likelihood of anti-inflation measures in the United States leading to, at best, a mild recession.
The American balance of payments deficit reached the fantastic figure of 3.8 billion dollars in the April-June quarter of this year. This figure is to be treated with caution because it was accompanied by an actual increase in the currency reserves held by the Americans. However, it did reflect a deficit in trade of an annual rate of over 15 billion dollars, The American Government is bound to take anti-inflation measures and do other things to help its trade position,
Both these steps are certain to hit the United Kingdom. On average, this country sells 12 per cent. of its exports to the United States. Just now with internal deflation and restrictions on government spending, the only way the economy can be kept on its present level is by a massive increase in exports (barring a socialist policy).
This country is already doing badly in a relative sense in the struggle for exports: the massive deficit on the American balance of payments means a surplus for other countries, In fact, practically every other country did share in this surplus[.] Britain shared with France the dubious honour of not taking advantage of the American's bad trade figures.
Unemployment was recorded at 606,152 people on August 11th - the highest total for August since the war. The Ministry of Employment and Productivity drew comfort from the fact that the rate of increase in full-time unemployment was down on that of the last two months. It also draws attention to the fact that the figure was swollen by a large number of school-leavers still unemployed. These qualifications might mean something if we weren't on the eve of a down-turn in the rate of world trade. As it is the LEAST these figures show is that Britain will be facing the coming period of likely recession with an already high level of unemployment.
This is the background to the 600,000 plus figure of unemployed in August. Whilst Wilson and Co. will undoubtedly try to draw some comfort from some more improvement in Britain's trade figures (to a great extent statistical and conjunctural) the outlook is extremely gloomy.
Wilson has explained his anti-working class policy by the need to sort out Britain's economic position, In the event we have got the worst of both worlds: anti-working class policies and no solution to the economic situation,
NIXON'S VIETNAM POLICY
Nixon is now threatening North Vietnam with not withdrawing troops from South Vietnam unless he sees some sign of reciprocal action,
Two remarkably frank articles in the British press recently cast light on the hypocrisy of Nixon's "stick and carrot" posturing,
The ECONOMIST of August 16, quoting the opinion of "a lot of military people" said:
"They argue that the Americans and South Vietnamese can maintain the war at its present level after as many as 100,000 Americans have been pulled out without running unnecessary risks[.]
"There are a number of reasons why they say[:] The supply and administration system is now established, General Abrams' emphasis on 'clear and hold' operations is proving more effective in bringing security to the villages in the countryside than the original 'search and destroy' tactics."
The FINANCIAL TIMES of August 25th also made the point that many American officials argued that the war could be continued with 100,000 less troops, But it has this to say about opposition to the war:
"There is a widely held belief in Washington that Mr. Nixon has only got away with his Vietnam policy" (i.e., promising to end the war and doing virtually nothing) "because the students have been away all summer, and that as soon as the universities open up again in September there will be plenty of trouble, All reports from student organisations confirm this: they want action on the war, and they want it now, They will demand it, just as they demanded it of LBJ, finally increasing the general pressure on him to the point where he has to give.
"This is not an attractive prospect, for President Nixon or for anyone, Student agitation rubs off on non-students, especially when they are agitating against something as unpopular as the Vietnam war, For 18 months now Mr, Nixon has been telling the American people that he will end the war.
Then the article comes to the punch-line: "Any discontent will only be aggravated by the fact that inflation drive will be hurting people much more, directly than now...."
Don't be surprised if Nixon announces new moves to end the war....just before the elections.
Actually, all the evidence points to Nixon carrying on with Johnson's policy, The latter was forced - by the Tet offensive last year - to abandon his policy of meeting each blow of the NLF by an escalation: it just didn't pay off and the consequences (mounting inflation, increasing opposition to the war at home and abroad, etc,) were too much to bear. He then switched to a policy of maintaining the war and trying to get concessions - since none have been forthcoming both he and his successor have been waiting for "something to turn up." They have both tried to present this policy (or lack of a policy) as proof of their desire for peace,
Things indicate that more and more people are seeing through this in the United States. We also have to work for this understanding.
RACIALISM IN LEEDS
The left has been far too complacent about the danger of racialism, Whilst it is very important to distinguish between racialism and fascism, we would be very foolish if we weren't worried by recent events in Leeds,
Crowds roamed the streets shouting "let's get a Pak" and many people were molested and even attacked just because of the colour of their skin, There are well-substantiated reports that fascist and racialist organisations had been active in the area,
We also understand that local response by the left was minimal, This, if true, is most regrettable in view of the potential strength of the left in Leeds,
It is important to nip racialism in the bud, As the social crisis in this country grows, as all the traditional organisations prove impotent, the discontent of workers and lower middle class can easily be channeled into racialist paths, Every manifestation must be fought as it arises, It will be best fought by a combination of an anti-capitalist programme and political clarity,
Racialism will be beaten not by going down to the lowest common denominator of the opposition to it but by a firm anti-capitalist campaign, Many of those infected by the virus of racialism, nourished by generations of chauvinism, are discontented with the present state of affairs, They fall victim to the propaganda of right-wing [illegible] to the things which cause their poverty and bad housing.
They can be won away from this only by firm [illegible] fascist groups divert attention from the real culprits in this matter, the leaders of the Labour Party, who will also mouth phrases against fascist groups whilst passing racialist legislation,
Racialism is also countered by the black and brown workers organising themselves to defend their people, Lumpen workers respect people who stick up for themselves, The left should help in every way it can the immigrant workers to organise themselves into defence squads, and should also provide defence squads where necessary. Leeds has been a warning, let us take steps to heed it before it is too late,
STOP PRESS
EYE WITNESS REPORT FROM PRAGUE by John Presland
The first anniversary of the Kremlin's invasion of Czechoslovakia was marked by demonstrations in the country's major cities, These demonstrations had the support of practically the entire Czechoslovak people with the exception of a handful of Stalinist bureaucrats and their police force[.] Nevertheless, the Husak Government used its police and conscript army to suppress viciously every manifestation of discontent with its Kremlin-orientated policy.
On August 21st, I was among a group of some [illegible] people who were doing nothing more subversive than watching an abandoned barricade burn, No attempt was made to clear the crowd with tear gas[;] instead and without warning, soldiers charged in firing as they ran, while it was also shot at from an armoured car. The victims of this assault could do nothing but run, leaving several dead or wounded behind them.
Stalinist police methods I experienced myself, when I was arrested after being batoned without reason by a policeman. Upon being interrogated I was accused of having "participated in an attack on the police", and was told I could choose between imprisonment or immediate exile from Czechoslovakia.
Attacks and police malpractices such as I witnessed in Prague were not exceptional during the period around August 21st, It was, in fact, their widespread use that Gustav Husak won what the Kremlin ironically calls "The Order of Lenin".
N.B. A longer report from this comrade will be appearing in the next issue of BLACK DWARF,