By Sacha Ismail
The arrest last month of Labour Party fundraising chief Lord Levy and Downing Street director of government relations Ruth Turner over the loans for peerages scandal has created a crisis for New Labour.
In July 2006 it was revealed that a number of loans had been made to Labour by businessmen who were later nominated for peerages. A police investigation ensued. The police have arrested and questioned (though not charged) Levy and Turner, as well as Sir Christopher Evans and Des Brown, two major business donors to the Labour Party. The police investigation has focused on whether the 1925 law banning the buying and selling of peerages has been broken, but Turner was also accused of perverting the course of justice, i.e. attempting a cover up of what has taken place.
For a government that came to power at least in part as a result of revulsion at Tory sleaze, all this is deeply damaging. It may yet force Tony Blair into resigning.
But the affair highlights also deeper political, and social issues. The connection between corruption and the funding of the Labour Party by big business is not coincidental. Although the problem sleaze is exacerbated by the particularly secretive, bureaucratic form of the British capitalist state, for instance the existence of a second chamber filled by party appointees, corruption is implied by the whole system of political parties funded by and doing the bidding of the rich.
The only real solution to the problem of political corruption is the forceful reinstatement of organised working-class politics, building a democratic labour movement counterweight to the politics of the rich. And in these terms the "solutions" advocated by the Blairites are not just inadequate, but actively harmful.
The proposal for a £50,000 cap on donations, proposed by the Tories but seconded by leading figures in New Labour, is a blatant attack on the right of the labour movement to organise a voice in politics.
Similarly, state funding for political parties will move Britain closer to the situation of the US, where the two main, virtually indistinguishable bourgeois parties are thoroughly intertwined with the state machine.
Blair wants his legacy to be a final push to drive the British working class out of politics. The only adequate response is for the organised working class, and in the first place the unions, to take this opportunity to fight back, using their position in the Labour Party to fight Blairism and, if necessary, rally the forces for a new working-class party.
This means supporting John McDonnell's bid for the Labour leadership; but also a perspective of restoring class to its rightful place at the centre of politics by challenging the bosses at every level, from industry to Parliament.
The union leaders we currently have show no sign of doing that. We need to make them fight, and be prepared to replace them if they will not do so.