It was the beginning of the end for the government’s incomes policy. Within a matter of months, the “Winter of Discontent” had commenced. This movement was initially sparked off by an announcement by James Callaghan of a further round of wage restraint. But the prime minister had misjudged the mood entirely. Workers had reached their limit and were not prepared to toe the line any longer. With the TUC in opposition, the incomes policy was dead in the water. Callaghan’s wages proposal was again rejected by the full TUC conference in September 1978.
This signalled a general offensive by the trade unions keen to get back the ground they had lost. Between October 1978 and March 1979 some ten million working days were lost through industrial action. Perhaps the most significant strike was at the Ford Motor Company in 1978, where after seven weeks on strike workers won a 17 per cent increase in wages. In the course of this dispute, the Labour Party Conference also voted against the Labour government’s new five per cent pay policy. This represented a mortal blow for the government. The vote reflected an important shift to the left within the unions and Labour Party. The workers had needed time to digest the lessons of the past period. Now consciousness began very quickly to catch up with reality. By the end of 1978, all hell was let loose.
It is a social law that discontent within the working class finds its expression within the official mass organisations, and this is above all true in Britain. Opposition tends to develop first in the trade unions, then with a certain delay, in the Labour Party, which is historically the political expression of the unions. If their leaders, as in the 1950s and early 1960s, block the workers from taking official action they will tend to take unofficial action. Nevertheless, this accumulated resentment will ultimately find its expression within the trade unions – as is currently taking place today – and also inside the Labour Party.
Local authority manual workers, who were one of the poorest paid sections, took widespread action in support of their wage claim, beginning with a major one-day strike on 22 January 1979. Talks finally broke down at the end of January and half a million workers took strike action in the first week of February. These workers were subjected to a smear campaign in the press, with lurid stories of dead bodies being left unburied and rats in the streets, but they managed to hold out until a revised offer of nine per cent was made at the end of the month.
In a remarkable show of militancy 185,000 TGWU lorry drivers won their first national strike for 50 years through effective picketing. Strike committees were established to run the strike, which vetted transport needs, permitting emergency and essential deliveries, but stopping all others. It was once again a demonstration of the potential power of the workers, and an echo of the Councils of Action of the 1920s. These committees constituted elements of “dual power” in the strike, as they challenged the prerogatives of employers and the state. Thatcher, who was horrified at this display of union strength, declared in the Commons,
Now we find that the place is practically being run by strikers’ committees… They are ‘allowing’ access to food. They are ‘allowing’ certain lorries to go through… They have no right to prevent them from going through.
Other low-paid sections, like ambulance workers also followed suit. Although troops were brought in to deal with the dispute, the government made an improved offer of nine per cent plus the promise of pay comparability. On the basis of the revised offer the strike was called off. The struggle of these low paid workers – predominantly women workers – brought them into the trades unions in droves. Membership of the National Union of Public Employees (NUPE), for instance, swelled from 256,000 in 1968 to 693,000 a decade later! Total union membership in 1979 reached unprecedented levels, embracing some 13.3 million or 55 per cent of the workforce. It was an incredible figure and a historic high point of trade union organisation.
The tremendous strike wave of 1978-79 was largely a product of the wage restraint of 1974-77. Workers were prepared to make sacrifices for the Labour government, but were now no longer prepared to see a dramatic fall in their living standards. After months of dithering, in May 1979, Callaghan decided to call a general election. This was a bad miscalculation. As in 1964-70, the counter-reforms of the Labour government had created widespread despondency and disillusionment. On 28 March the government lost a vote of confidence in the Commons by 312 to 311, and Callaghan was forced to dissolve Parliament. In the ensuing general election on 3 May, the Callaghan government was defeated. The Tory leader, Margaret Thatcher, became the first woman Prime Minister in history. She would end up also as being the most hated.
The pundits blamed the 1979 defeat on the “Winter of Discontent” and the militant actions of the working class. This is fundamentally false. It was not the struggle for decent pay that caused the defeat, but the growing alienation of workers fed up with the counter-reforms of the Labour government. It was this mood of widespread apathy and abstention amongst Labour voters that led to the electoral debacle. “Disillusion with the Callaghan government was almost complete. Once again, a Labour administration had lost touch with its own supporters”, stated Eric Heffer.[12] Even Denis Healey concurred, “Jim himself was badly out of touch with popular feeling.”[13] The same process had resulted earlier in Labour’s defeat of 1970, a lesson that was not lost on the rank and file of the labour movement.
The coming to power of Margaret Thatcher in 1979 was to pose a new and dangerous threat to organised Labour. The strategy of the Tory Party, developed while in opposition, was to break the power of the unions and to seek revenge for the humiliations of the past. This, in turn, was born out of the special crisis of British capitalism and the need to tame the working class. Thatcherism, which represented capitalism “red in tooth and claw”, was to prove the greatest of test for the trade union movement for more than half a century.