The government and the right-wing media would like it to be known that they are very disappointed with the lack of scruple, principle and resolve on the part of the capitalist class. In these difficult, austere times, it was incumbent on them to make very public, proud, ostentatious use of freebie labour, and to show class-wide unity in the offensive: not wilt under the slightest pressure from the Socialist Guardian BBC Bloody Trotskyspart General Strike Workers Party. 

The aforementioned parties have therefore decreed the following: 

1) it is a disgrace that a tiny party with no seats in parliament can make us look likely bloody idiots; 

2) of course, we don't look like idiots - they look like idiots, we look great, and we're winning (winning, winning, winning!); 

3) businesses have to stiffen their spines and stop pretending that they're embarrassed to be seen in public with us... yeah, well, does our face look bovvered?; 

4) you turn if you want to, Greggs, Tesco and the rest, but we're not for turning, unless you want us to. Do you want us to? Do you want some free money? We'll give you free money. Look, have Iain Duncan Smith's house, he doesn't need it, he sleeps in the fucking crypt.; 

5) it's not true that we're very unpopular. The SWP is very unpopular. We have written it in our columns, and said so on the television, and now everyone knows just how unpopular the SWP is.; 

6) the SWP is a tiny party, completely irrelevant, things would be perfectly okay if everyone would stop talking about the SWP.; 

7) the SWP has eaten our hamster.

Overall, public spending is being cut by about a fifth in this spending review. Let's have a quick look:

*£7bn additional cuts in welfare spending. That's a huge figure. Total welfare spending including income replacement benefits and social exclusion spending is £60.4bn. If it's coming out of the whole, it's more than 10% cuts. If it's just coming out of income replacement benefits, it's closer to 26% cuts. Judging from the BBC's coverage, it's mainly coming out of income replacement benefits. Either way, it's going to be extremely messy if you're disabled, on the dole, or on low incomes.
*7.1% a year reductions in council spending for four years, which I think is a total of 28.4% cuts - that's your libraries, rubbish collection, street lighting, paving, all the basic quality of life stuff, savaged. Social housing is to be 'reformed', which basically means torn to pieces.
*7.1% cuts a year in the Department of Business Innovation and Skills, which deals with higher education, investment in R&D, consumer protection, trade issues, etc. Over four years, I guess that amounts to 28.4% cuts.
*40% cuts to higher education are included in that figure. This was anticipated by the Browne review, which basically recommended tearing up funding for teaching, while keeping most research funding.
*3.4% cuts in the Department of Education, with 40,000 teaching jobs lost.
*Higher rail fares, which will raise by 3% above the rate of inflation until 2012, presumably to make up for a shortfall in investment. Rail fares in the UK are already among the highest in Europe, especially in London - where the system is going into chaos under Boris Johnson.
*Retirement age to rise to 66, thus saving on pensions in the long-term. The Hutton review, which has already recommended cuts to public sector pensions, is cited in support of this measure - thanks again, New Labour.
*490,000 public sector job losses are expected, and if this government's track record is anything to go by, that's an optimistic assumption.

There are also a whole swathe of cuts coming in environment, justice, the foreign office, and the department for energy and climate change. Apart from everything else, this is not a green budget. Let's also take a quick look at police and defence. The police are going to lose 16% of their budget over the next four years. That's quite shockingly high to my mind, more than I would have expected, and it takes a risk with the police's political support for the administration - which I would have thought they would want to safeguard in a potentially turbulent era. The MoD is going to lose 8% of its budget - way lower than the 20% initially flagged up, probably due as much to US pressure as to pressure from the military brass itself. But it does mean fewer troops, and a delay in the replacement of Trident. For Cameron, this probably means not a break with the 'special relationship', but much more dependence on the US.

Well, that's it. The Tories, of course, have tried to sell this as 'progressive' in that they claim it will affect the rich more than the poor, and are massively overselling a puny bank levy which they claim will raise £2.5bn a year. No one is going to buy the progressive sell, beyond the dippiest of Liberal loyalists. I await a fairly comprehensive trashing of this dubious cover from the Institute of Fiscal Studies or a similar think-tank. The situation could not be clearer: either we stop them or they finish us off.

Treasury figures show that the spending cuts will cost 1.3m jobs, 600,000 of them in the public sector. HM Treasury estimates that this will be made up for with the creation of 2.5m new jobs. David Cameron now claims that 2 million new private sector jobs will be created in the next parliament, citing the 'independent' Office of Budgetary Responsibility. The private sector thinks not. The TUC seriously doubts it. And the think-tanks don't believe it. For good reason, as well. Anthony Painter points out that in the last decade the years of growth lasting from 1999 to 2007 saw the creation of only 1.52m private sector jobs, or 190,000 jobs a year. The Treasury is relying on the creation of 500,000 new jobs every year for the next five years, in a period of economic stagnation. There is no way in hell that is happening. Not only that, but most of the job growth in the last decade accomodated growth in the labour force. Now, the total labour force will grow by o.25% each year from 2011. That means the economy would have to add a net ≈100k jobs per year, just to avoid unemployment increasing. That it could feasibly manage. But half a million new jobs every year is an ornate fib with brass balls on.

Guest post by Jules:

The backdrop to this Saturday's 'Right to Work' conference was an ongoing economic and political crisis that has seen unemployment rise steeply, public services slashed, a 'good war' become a running sore, and eye watering bonuses for a tiny minority for whom it is business as usual. Combined with the widespread anger and lucid understanding of what is coming, there is a real desire to resist.

Sometimes events simply expire while you are there and sometimes they are the beginning of something. The Right to Work conference in Manchester this Saturday which crammed 900 socialists, trade unionists, students and activists from campaigns of various stripes into the Methodist Central Hall, most definitely fell into the latter category. The purpose? To begin to cohere and pull together the different centres of resistance that have flared up in the last couple of years and start to build the wider ''networks of solidarity'' the working class will need if it is to beat off the intensification of the neo-liberal offensive over pay, pensions, working conditions, public services and education that looms after the general election.

So it was a good start. Those attending represented various labour movement bodies and campaigns, trade councils, union branches, national organisations like the National Shop Stewards Network, Labour Representaion Committee, STW, UAF, the Unemployed Workers Union, Sheffield Pensioners Action Group, various Green Party branches, revolutionary left groups to name but a few. The speakers on the platform in the opening and closing sessions and the lead speakers in the 11 workshop sessions demonstrated just how broad and serious the Right to Work campaign is intended to be in building on the major examples of struggle and resistance in the last year.

There was an optimistic, militant spirit, best represented by those speakers directly involved in the strikes, disputes and occupations of the last year such as the Leeds refuse workers dispute, the Tower Hamlets college strike, the Superdrug workers, Vestas, London Cleaners campaign and so on, but also ongoing struggles such as the national Fujitsu dispute. The Fujitsu dispute is crucial, and hopefully a harbinger of the future, as it has taken place in an industry hardly touched by trade unionism or militancy but which since it began has seen over 1,400 workers join the union. Fuelling the optimism expressed at the conference is the fact that many of these struggles have been successful, breaking the dismal trend of a generation of defeat. They have defied and seen off anti-trade union laws, and revived of forms of action that appeard to be redundant or anachronistic. And they have actually delivered for the workers involved. Michael Bradley (SWP, RTW committee member) summarised this mood when he observed ''something has changed'' - and people understood this referred as much to the possibilities as the recent past.

The workshops reflected this, for example, Jerry Hicks, militant candidate for the General Secretary of Unite led off a session on 'How Can We Stop The Jobs Massacre?' Other sessions dealt with fighting the anti-trade union laws, organising against anti-immigrant racism, ending the pensions swindle, organising the unemployed, fighting climate change after Copenhagen and more but crucially made the connection between these different aspects of the anti-capitalist struggle.

Your correspondent personally attended 'How Can Workers Get A Real Political Voice' led off by Michael Lavalette and a speaker from LRC. This was not the sparkiest session perhaps. While there is a recognition of the need for a left realignment and the existence of a sizeable electoral minority to the left of Labour - it got a little bogged down in the brouhaha about whether to vote New Labour where no credible left candidate was standing. The decay of Labourism / Social Democracy and its implications was missing from the debate. And among some, some humility or acknowledgement of how relatively marginal the left is in electoral terms, was missing too. But obviously in Britain left realignment still has some way to go.

The final rousing session - 'building solidarity' drew the different strands of the conference together. Next stop? To ensure the biggest presence possible in Redcar 13 February to oppose the Corus jobs massacre that would - if it were allowed - kill the town. And then... building the defend public services demo in London 10 April and ensuring the biggest presence outside the Tory's spring conference. There is much work to do and Saturday was a good beginning.

Forget about green shoots, and don't be taken in by chipper 'investors'. The UK is tanking. In the year to June, UK GDP declined by 5.6%, a fall almost identical to that in the first years of the Depression. Unemployment made a record rise in the first quarter of this year, despite the fact that public sector employment rose. Corporate profits continue to tumble (only boosted a little by hypertrophic profits from 'continental shelf' companies). Unlike in the US where massive, centralised intervention and public spending higher than its peak in the 1930s may well have mitigated the crisis (and state spending has had to soar because consumer spending is not recovering), the UK is still in freefall.

So, why is it that the Tories are planning for 'deep' spending cuts in the event of their winning the next election? David Blanchflower, the sole 'dove' on the Monetary Policy Committee, pointed out a while ago that the experts who have called for such cuts also tended to be those who missed the recession in the first place, and are still basing their expectations on outlandishly optimistic assessments. Cutting public spending now or in the near future is a certain way to prolong and deepen the recession when major public investment is the indicated remedy. Even in the enormously unlikely circumstances of a rapid recovery, the regional impact of public spending cuts would be dire - Wales, Scotland and Northern Ireland in particular have tended to rely on a healthy public sector for growth in the past, and would lose ground massively.

On the one hand, it is all too easy to believe that the Tories don't give a damn about high unemployment and long-term stagnation provided it weakens the bargaining power of labour and restores profitability in the long term. But one also gets the sense that both New Labour and the Tories, and possibly those sectors of the ruling class that they represent, are still in deep denial about the scale of this crisis, its durability, and what it means for the neoliberal settlement of the last thirty years or so. They really are trying to restore the situation that prevailed prior to the 'credit crunch', based on debt-fuelled consumption, low corporation taxes, a 'flexible' labour market and so on. But people, quite sensibly, don't want to borrow money to spend at this time, so there isn't going to be a consumption-led recovery based on debt. The figures bear this out - despite a jump in new mortages, the main trend is for people to avoid using credit cards and save whatever money they have. Long-term high unemployment, expected to continue in most advanced economies, could only entrench this trend, unless the state decided to support consumption directly, bolster the bargaining position of labour and engage in job creation programmes that would bolster the state sector of the economy. But this would involve precisely the kind of programmatic re-ordering of public priorities that none of the mainstream parties are currently capable of.

Guest post by redbedhead:

When the US Federal Reserve Bank decides to cut interest rates by three-quarters of a percentage point, between meetings, that’s what you call the smoke that tells you there’s a fire. This is the first time that the Fed has cut rates at an emergency meeting since September 2001, after the World Trade Center attacks. And it’s the biggest single cut in interest rates since 1982. And word is that there will be another half percentage point cut by the end of the month if this adrenaline shot to the heart attack patient doesn’t revive it. But a lot of folks are worried it’s too little too late and that the economy is already in a self-reinforcing downward spiral.

A look at the numbers certainly would indicate that things are not good:

“U.S. payrolls rose by 18,000 in December, capping the worst year for job creation since 2003, and unemployment jumped to a two-year high of 5 percent, according to Labor Department figures released Jan. 4.
“The housing slump also deepened last month, with home construction falling 14 percent. Starts were down 25 percent for all of last year, concluding the worst year for the industry since Jimmy Carter was president. Sales of previously owned homes also slid in December, as single-family property prices posted their first annual decline since the Great Depression, the National Association of Realtors said today.”

Claims that the US isn’t already in recession are belied by these kinds of numbers and the panic that’s setting in on stock markets and in government. The degree of slowdown isn’t known yet but what is known is that it is greater than they’re saying. The stats for the third quarter in the US indicated that growth had “rebounded” to 3.9% but once inflation and population were factored in, it was actually closer to 1.5%. The fourth quarter numbers haven’t been released yet but don’t be surprised if we’re already in a contraction. In the face of this unfolding debacle the US government has also stepped in with its own $150 billion economic stimulus package. However, that package is entirely in the form of tax rebates of up to $600 per head, plus $300 per child. In other words a family of four that earns a household income of less than $75,000 would get a cheque for $1,800.

Now, $1,800 is nothing to sneeze at and it shows what bogus are the claims of from politicians and economists that the market should rule. $150 billion dollars is a big interference in the market. But the package specifically doesn’t include extending unemployment benefits or granting more food stamps. US rulers live in fear that workers in the US will get uppity or decide that the poverty of unemployment insurance is better than their shitty, soul-destroying and/or dangerous job.

There’s a problem here though and it is two-fold. The basis for restoring the US economy is consumer spending, which makes up 70% of GDP. But the trouble is that consumers have no more cash. In fact, they are drowning in debt, which has been increasing at a rate of 7.5% per year since 1997. In that time the amount of household debt has increased from $8 to $14 trillion dollars. In other words household debt as a percentage of GDP has rocketed from 66% to around 95%.

And not surprisingly, debt servicing payments are now at record highs. I haven’t even gotten into the massive and ballooning US government debt, which is headed towards $10 trillion. The point of all this is that the $1,800 that family of four is about to get in the mail is probably going to go on paying down the credit card to ease the interest burden. This is especially the case since some see house prices declining by 20 to 30 percent, which means that any further credit against home value will have dried up for a lot of Americans.

And credit card payments are not an economic stimulus – that’s just paying for old growth, not creating new growth. So, the layoffs will continue, which will reduce demand and create more layoffs. Giving out money is also stupid economics. $150 billion dollars that is dedicated towards specific employment projects, such as they had in the 1930s is a much more efficient way to spend money than to just throw it in the air. Economic enterprises have multiplier effects on the economy – building the Hoover dam gave jobs to thousands of workers, those workers spent money, the project bought equipment and raw materials, those materials had to be shipped, etc. Of course, other than in the field of military spending, this doesn’t fit with the neo-liberal consensus. What does that mean – the shithouse is going up in flames and they’ve locked us inside.