Denmark: A change in the situation

In November 2011 Denmark’s right-wing coalition government led by the Liberal party (Venstre) lost the general election to the centre-left coalition led by the Social Democrats. This election marked the end of a period of neo-liberal domination in Danish politics that had lasted ten years. Many working people hoped that this new centre-left coalition government would mean a change in economic and social policy, not least because for the first time ever the Socialist People’s Party (Socialistisk Folkeparti, SF) was participating in the government. Although it should also be said that, along with the Social Democrats and the SF, the government also embraced the liberal-centrist party, ironically called the Radical Left (Radikale Venstre).

Although the global crisis of capitalism has not yet hit Denmark with the same ferocity as it has hit European states such as Greece and Spain, growth in Denmark remains negligible and the ruling classes have been attacking the living standards of ordinary people. The hopes of workers and youth that this new government would defend them against such attacks have been consistently let down since the election and in the last two weeks it has become clear which side of the battle over austerity this government has chosen. The government has introduced three reforms that take money away from students, the unemployed and public welfare and hand it straight over to big business. 

However, the last two weeks have also seen the beginnings of a change in the mood of society. We have seen the biggest student demonstration in five years and this represents a huge awakening amongst the youth. At the turn of the millennium there was a wave of protests, demonstrations and strikes against the liberalisation of the labour market by the newly elected neo-liberal government. But this was cut across both by the lack of militant leadership of the workers and the crisis of capitalism that began in 2008 and which had a shock effect on the working class and youth, paralysing them into inaction. Now it seems this passivity has been broken. The youth often works as a barometer for what is going on below the surface in society and this upsurge in opposition to austerity amongst the youth is a sign of what is to come across all layers of society.  

A reverse Robin Hood – stealing from the poor to give to the rich

In recent weeks the government has introduced two reforms that aim to make students and the unemployed pay for the crisis. Two billion Danish Kroner (DKK) is to be cut from the budget for student grants (out of a total budget of DKK 19 billion). These cuts take the form of lowering the cap on the amount of grant money that can be claimed, drastically lowering the amount of money available for students living at home during their studies, and removing the allowance for the sixth year of study thereby forcing students to finish their courses much faster than is currently the case.

These cuts remove financial support for many students who would be unable to study without these grants. This is a step towards an education system only for the children of the rich, who can afford to study without financial help from the state. It also risks creating a two-tier system in the universities where students who rely on grants are rushed through their course as quickly as possible, while those students wealthy enough not to have to rely on the grants are able to complete their studies over a longer period of time at a comfortable pace.

Many students are asking: why should we be forced to rush our studies? Unemployment in Denmark is still at a record high and, for many students, final exams are just a ticket straight to unemployment. The real aim of the government became clear when it was announced that the intention was not only to save money but also to “increase the work force”. What went unsaid by the government but is clear to those students who will suffer under this measure is that an increase in the work force means nothing but higher unemployment thus putting more pressure on wages and working conditions.

A few days later the government also launched a reform of the public unemployment benefits. Also here the changes will clearly have a disproportionately damaging impact on the youth in society.

The day after this cut to unemployment benefit the government revealed the destination of the savings made by cutting the welfare budget with the launch of a “Growth Plan”. The DKK two billion being taken from the students and DKK one billion from the unemployed are to be given to big business in the form of reduced tax rates. Business tax is to be reduced from 25 to 22 percent and environment taxes for businesses have also been slashed.

And it is not just funding cut from the students and unemployed that is to be given to big business. The pace of public spending cuts will increase more than planned each year until 2020 with the plan for next year alone requiring a “saving” of DKK two billion in city councils which will affect schools, kindergartens and other vital services.

The government claims that this is all to create jobs in the private sector. But there is no evidence whatsoever that reducing taxes for companies creates jobs. On the other hand we know for sure that these changes will create higher profits for the bosses. The toy-company, Lego, made a profit of DKK 7.9 billion in 2012, 40 percent higher than the year before, the fifth year in a row with a growth of more than 15 percent in turnover. Despite this Lego has just announced the termination of production in Denmark in favour of moving factories to Mexico, Hungary and the Czech Republic. At a time of capitalist crisis the bosses are seeking to minimise costs as far as possible by stopping production or moving it overseas to countries where the cost of production is much cheaper than in the developed world. So in fact the plan to reduce corporation tax by cutting welfare will not create jobs, quite the opposite! It is estimated that the cuts in public spending will result in a loss of more than 8000 jobs in the public sector with little chance of any more private sector employment.

The tasks of the Unity List

The government has disappointed all those who voted for it in the hope of stopping the neo-liberal government and its austerity programme. In fact, this government is implementing harsher austerity than the old one. These latest reforms have proven to be the straw that broke the camel’s back. For those on the Left it has raised the question: what now?

The government is a minority government, which is common in Denmark. It was able to take power thanks to the parliamentary support of the left wing party, the Unity List, which acts as the “parliamentarian base” of the government.

The leaders of the Unity List have now moved the party into a difficult position. After the elections these leaders decided to support the formation of this government even though the government’s plans clearly showed that the austerity programme would be continued, with attacks on pensions, early retirement, unemployment benefits etc. After that the Unity List voted for the first state budget and imperialist intervention in the war in Libya.

The leadership of the Unity List continually refers to the tactic of the “lesser evil”: that the present government, despite everything, is better than the neo-liberals and that therefore the Unity List must support this lesser evil. In really this tactic gives a carte blanche to the government which only has to threaten to do a deal with the Liberal party and thereby get the Unity List to agree to anything it proposes.

It was not until the government came to an agreement with the Liberal party this summer to approve tax breaks for the rich paid for by cuts to unemployment benefits that the leaders of the Unity List adopted a principled position of defence of ordinary people. They declared they were no longer the parliamentarian base for the government but were now in opposition. This move resulted in a boost for the Unity List both in opinion polls and membership. But it didn’t take long before the next state budget was negotiated and the Unity List leadership fell back onto the old argument of the “lesser evil”. The Unity List leadership gave up being in opposition even before it had really shown in practice that it opposed the government, and they went ahead with making the state budget with the government, despite its imposition of severe cuts and attacks on the unemployed and students.

This situation has left the leadership of the Unity List in a bit of a mess. After their opposition to the tax breaks they showed that their threat of going into opposition only lasted until the government looked as if it was about to collapse, at which point the Unity List returned to continue to prop it up. In other words, these leaders’ empty threats made them the only party capable of saving the government, thereby clearly making them responsible for the government’s continuing austerity program. The longer the Unity List continues to behave like this, the more it will be seen by the mass of people as equally untrustworthy and anti-working class as the government.

The consequences of taking on responsibility for the government’s austerity policies becomes clear when considering SF, which now stands at less than five percent in opinion polls (in the elections they got thirteen percent and at the height of their popularity they garnered almost twenty percent in the polls). If the Unity List continues as it is now with thunderous speeches, full of rhetoric but without real content, they run the risk of suffering the same fate as SF. Instead it is time the Unity List draws a line between itself and this government.

The Unity List has brought seven demands to the negotiations on the “Growth Plan”, including no cuts to student grants and unemployment benefits as well as better conditions for the unemployed. To put forward non-negotiable demands is a good first step. But some of the demands are quite abstract – “better conditions” for the unemployed is difficult to define, a more concrete demand such as the reversal of cuts already implemented would be more effective – and in any case the Unity List didn’t specify any consequences if the demands are not met, other than withdrawing from negotiations and leaving the decision-making to the Liberal party. Plainly speaking, the government does not care one bit if the Unity List withdraws from the negotiations. From the beginning it has been clear that these reforms were to be made through cooperation with the Liberals. The Unity List’s opinions on this issue are not of much interest to the government.

The Unity List has to show that it means what it says if it is not to lose all credibility and risk ending up like SF. The Unity List must say to the government: “If you go ahead and adopt the “Growth Plan” with all its cuts and anti-working class reforms, you will have broken the promises upon which you were elected. We will not take responsibility for your government when there is not an ounce of progressive politics left in its policies. If this plan is adopted we think new elections must be held and therefore we call a vote of no confidence.”

All responsibility must be laid at the feet of the government; it must be their choice alone whether to pursue austerity measures. A vote of no confidence in the government is a serious and exceptional step, but in a situation as serious as this, such a step is necessary. This is an opportunity for the Unity List to table a vote of no confidence on the basis of a decisive issue for Danish workers and youth. If this opportunity is missed the party will not be able to come running back at a later stage to put forward a vote of no confidence on a secondary question without completely discrediting itself.

A crystal clear break

The leaders of the Unity List object: “A vote of no confidence will mean the right-wing gets back into power”. That is very likely. But there is no doubt that if the present situation continues the right-wing parties will get back in power anyway. The right-wing wants to get the workers’ parties to carry through all the unpopular cuts, discredit themselves and then come back into power with the strength to carry through even harsher attacks and with an opposition that has weakened itself by carrying out austerity policies now.

If the Unity List puts forward a vote of no confidence in the government it could only be successful with votes from the right-wing parties, and no doubt this would create some problems for the Unity List. Many people may lay the blame for allowing the right-wing back in power with the Unity List, and to some extent they would be correct. This just highlights how the Unity List leadership has positioned the party in a situation where its only choice is between the plague and cholera. What the party must do is openly speak the truth: “we recognize that the strategy so far has been wrong and has put us in a difficult position. We should have made our support for this government conditional upon guarantees that attacks on youth and the unemployed will not be carried through. Without those guarantees we should have refused to support the Social Democrats at all in the first place.”

If the Unity List once again props up the government, it will lead itself even further into this quagmire and make it more and more difficult to find its way back. People will rightly ask why a party that has already made so many compromises suddenly now decides to try to overthrow the government.

In Italy we have seen how the left wing in parliament has completely disappeared after Rifondazione Comunista (RC) participated in the Social Democratic led coalition Prodi-government in 2006 that led vicious attacks upon workers and youth. In 2008 RC voted for a motion of no confidence in the government on the question of the war in Afghanistan. The problem was that Italian workers and youth had already lost confidence in RC because of its participation in compromises and cuts with the bourgeois parties. When RC finally overthrew the government, on what was for them a secondary question, the last flicker of confidence in the party disappeared. RC has now lost all its seats in parliament.

If the government is to fall then it has to be on the basis of a crystal clear political question that workers and youth can understand and identify with. Otherwise the Unity List will not be able to put forward clear political ideas with which to fight for working people, the unemployed and the youth, and it risks the same difficulties as RC in Italy.

For a socialist alternative!

The Unity List must not only break with the government on the basis of a clear question but must also put forward a clear alternative. A major problem so far has been that the leadership of the Unity List has accepted the premise set up by the government: that there is a majority of the right wing parties (counting also the Liberal Radical Left party) and that the only thing that can influence decision-making is negotiations in parliament. The leaders of the Unity List must reject this false premise and instead start a campaign for a Socialist programme.

The members of SF are very unhappy with the policy put forward by their party leadership. The dissatisfaction was not least demonstrated by the election of the party secretary in November. Here the right-wing candidate, supported by the entire leading layer in the party, only got one third of the votes. Unfortunately the new party secretary, Anette Vilhelmsen, has done nothing to change the course of the party after she was elected. Her example has very clearly shown that the choice facing SF is between staying in government and accepting the austerity program or getting out of the coalition, there is no middle ground. The present leadership of SF, the former left wing in the party, has continued the line of the old leadership. This is sparking strong disagreement amongst members, which is shown for example in the fact that city council members in Horsens have started a petition arguing for SF to withdraw from the government. In addition the SF voters disagree with the current policy of the party leadership: 51% of those who voted for SF at the last election think they should withdraw from the government and only 23% think they should remain in government. Only 3% of SF voters agree with the cuts and austerity put forward by the government.

Furthermore, even at the heart of the leading governing party, the Social Democrats, there exists dissatisfaction with the government, exemplified by one of the Social Democratic mayors in Copenhagen, Anne Vang, who has said she can no longer recognise her party.

This simmering discontent represents the basis upon which the Unity List can fight against the government policy on a socialist programme. The Unity List must put forward an offer to the left wing in both SF and the Social Democrats of a united front to fight for a socialist alternative to the present government.

The first step is to put forward clear concrete demands, including:

Reverse all cuts to pensions, sick pay, unemployment benefits, student grants and early retirement provision.

No to all cuts! Expand the welfare state!

Make the bosses, not workers, pay for this crisis!

But this is only the first step. These demands are a necessary part of a socialist programme. There is no middle way at a time of capitalist crisis: the choice is between the barbaric measures needed to prop up capitalism or fighting for a socialist programme.  And this crisis shows no sign of going away. It still has its grip on the world economy and on Denmark. The latest figures show a negative growth in the last quarter of 2012. Some on the Left have put forward a Keynesian alternative to austerity through public investments but such measures require government spending. At a time when governments all over the world are short of cash the Keynesian approach of more government spending is not a practical possibility.

The only way forward is a socialist programme to take into public ownership the key sectors of the economy in order that they can be democratically and rationally planned in the interest of need and not profit. All over Europe we see governments of all colours carrying through the same austerity policies. What is happening in Greece and Spain now is what Denmark can look forward to if we cannot free ourselves of capitalism and its crises. In Southern Europe we have seen how the crisis has forced the youth and workers into class struggle and many have quickly become radicalised. It is natural that the class struggle first comes onto the scene were the crisis has been most acute. But the crisis is not confined within national borders, it affects all countries.

Same demonstration as the above - Photo: Sigfrid LundbergSame demonstration as the above - Photo: Sigfrid LundbergThe situation is changing in Denmark. The demonstration on February 28 with 20,000 students against the student grant reform is a symptom of the enormous dissatisfaction and anger that is building up under the surface in society. This is a sign of what is to come. On the same day as the demonstration the national organisation for city councils (Kommunernes Landsforening, KL) sent out a lock-out notice against all 50,000 primary school teachers as part of wage negotiations in the entire public sector that are currently taking place. The lock-out is to start from April 1st if the teachers do not accept severe attacks on working conditions. The government has discretely said that it is ready to step in and stop the conflict (and not in the interest of the teachers but in the interest of the employers). But the government is playing with fire – now unions, representing 500,000 public sector workers, have said that they too will not accept a new wage agreement until the teachers have one.

We have entered a new period in Denmark, a period where class struggle is on the agenda with further radicalisation just around the corner. The Unity List will be powerless to connect to these radicalised layers if they are seen as part of the established political system and as defenders of the crisis-ridden capitalist economy. Only by putting forward a real alternative can the Unity List distance itself from the present government and connect with these newly radicalised workers and youth to build a mass movement for the socialist transformation of society.