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Marxist Analysis · 2026-05-13

Core Argument

The central thesis is that the UK economy under New Labour was not the success story it claimed to be, but a structurally weakened rentier economy sustained by asset bubbles — first the stock market, then property. The firefighters' dispute of 2002–03 is presented not as an isolated industrial conflict but as a symptom of this underlying fragility. Roberts argues that the Blair government's refusal to grant firefighters a living wage was driven not by fiscal necessity but by the imperative to protect capitalist profitability: if public sector workers won concessions, it would threaten the Treasury's strategy of debt reduction, privatisation (PFI), and maintaining the conditions for financial accumulation. The article claims that the UK's low productivity, chronic underinvestment, and reliance on finance and property speculation made a crisis inevitable — and that the working class would be forced to pay for it.

Theoretical Grounding

The analysis draws on the Marxist theory of capitalist crisis, particularly the distinction between productive and unproductive labour. Roberts implicitly deploys the concept of fictitious capital — the stock market and property bubbles that temporarily masked the weakness of UK productive industry. The argument that "the worst paid jobs are the ones most useful to society but least useful to making profits" is a direct application of the Marxist distinction between use-value and exchange-value, and the subordination of social need to the logic of accumulation.

The article also engages with the Marxist theory of the state: the state is not a neutral arbiter but an instrument of capitalist class rule, willing to deploy troops against firefighters while remaining silent on the theft of pension funds by City financiers. The connection between imperialist war abroad and class war at home — "if you adopt the policies of capitalism abroad, inevitably you will adopt them in domestic policy" — reflects the Leninist understanding of the state as a class organ.

The piece sits within the tradition of Marxist crisis theory associated with the work of Michael Roberts himself, particularly his emphasis on the tendency of the rate of profit to fall as the underlying driver of capitalist stagnation. The reference to falling profitability "back to the lows of the early 1980s" signals this theoretical commitment, though the article does not develop the formal argument in detail.

Conjunctural Relevance

The article was written in July 2005, but its analysis is retrospective: it refers to the firefighters' dispute of 2002–03 and the Iraq War preparations of 2002–03. The conjuncture it describes is the tail-end of the dot-com crash (2000–2002) and the period of the property bubble that sustained UK growth in its aftermath. Roberts identifies specific data points:

  • Manufacturing output falling at 3% annually
  • Overall growth down to 1%
  • Investment falling at nearly 10%
  • UK productivity 30% below US, 25% below France, 15% below Germany
  • US capitalists investing 46% more per worker than UK counterparts; in high-tech, nearly three times as much
  • 57% of UK workers with no qualifications, compared to 20% in Germany
  • Stock market down 60% from March 2000 peak
  • House prices rising at 30% annually
  • Financial services contributing 29% of national income

The article correctly identifies the property bubble as the last remaining support for UK capitalism. The deputy governor of the Bank of England, Mervyn King, is quoted warning of "major imbalances." Roberts predicts that when the property bubble bursts — and when a world recession arrives — the UK's rentier model will collapse, and the working class will be made to pay.

In retrospect, this analysis was prescient. The 2008 global financial crisis, triggered by the US subprime mortgage collapse, exposed exactly the vulnerabilities Roberts identified: over-reliance on finance, low productive investment, and a state unwilling to fund public services. The firefighters' dispute was an early warning of the class conflict that would intensify after 2008.

Where the Argument Continues

The article leaves several threads underdeveloped:

  1. The formal theory of crisis: The reference to falling profitability is not elaborated. Roberts's later work — particularly The Great Recession (2009) and The Long Depression (2016) — develops the law of the tendency of the rate of profit to fall as the central explanatory mechanism for capitalist stagnation.

  2. The political strategy for the labour movement: The article does not discuss how firefighters or other public sector workers should organise beyond the immediate dispute. The RCI's broader analysis of trade union strategy — the need for rank-and-file organisation, the rejection of class collaboration — is developed in other IDOM articles and in the Against the Stream podcast.

  3. The international dimension: The article mentions world recession and oil prices but does not develop a systematic analysis of the global economy. Roberts's later work on the internationalisation of capital and the uneven development of the world system fills this gap.

  4. The nature of the British state: The connection between imperialism and domestic class war is asserted but not theorised in depth. The RCI's analysis of British imperialism — its decline, its subordination to US imperialism, and the role of the City of London — is developed in other texts.

Connections

  • Michael Roberts, The Great Recession (2009) and The Long Depression (2016): These develop the crisis theory only gestured at in this article.
  • Marx, Capital Volume III, Part III: The law of the tendency of the rate of profit to fall is the theoretical foundation for Roberts's crisis analysis.
  • Lenin, Imperialism, the Highest Stage of Capitalism: The concept of a rentier economy — living off investments abroad — is directly drawn from Lenin's analysis of finance capital and imperialism.
  • IDOM articles on the 2008 crash: Roberts wrote extensively on the crisis as it unfolded, connecting the UK's specific vulnerabilities to the global downturn.
  • Against the Stream episodes on public sector strikes: The RCI's podcast has covered subsequent public sector disputes (junior doctors, rail workers, university staff) as part of an ongoing analysis of the state's fiscal crisis and the attack on living standards.
  • The RCI's programme on the British state: The rejection of reformism and the call for a workers' government are the political conclusions that follow from the economic analysis presented here.

Key Quotes

  1. "It is the rule under capitalism that the worst paid jobs are the ones most useful to society but least useful to making profits."

  2. "The best paid in our society are those who manage big capitalist companies or bet on the stock market in the City of London (using our hard-earned pension savings and making a hash of it most of the time). But they contribute little or nothing to society."

  3. "The UK has become a rentier economy. It is an economy that does not make anything any more. Instead, it sells things others make or it lends money to others to make them or it lives off the income 'earned' from investments it makes abroad."

  4. "Every bit of surplus value created by British workers is being sucked into property speculation or investment overseas. Little or nothing is going into improving productivity and profitability in productive sectors or into exports."

  5. "The firefighters must pay the bill for this coming mess in advance. The rest of us will pay to bail out capitalism later through rising taxes and disappearing jobs."

  6. "If you adopt the policies of capitalism abroad, inevitably you will adopt them in domestic policy."