UP GOES THE COST OF LIVING!

the Tory Aubrey Jones in collaboration with George Brown's Department ot Economic Affairs.

Taken together with the changes of last Autumn, two of which, the increases in national insurance contributions and the increase in PAYE income tax, are now being felt by working-class families, the Budget represents a cut in real wages.

A number of deflationary measures, together with the cancellation of the TSR2, will produce unemployment and help to provide industry with a more 'mobile' labour force.

Callaghan has obviously paid attention to those business interests who pointed to the big risks in too heavy a dose of deflation. But purchase tax has not been increased even on luxury items, though power to vary rates at-short notice remains.

Through the Capital Gains Tax and the Corporation Tax, the impression is created that the Budget knocks the rich.

The very fact that the Chancellor expects the Capital Gains Tax to bring in f20 million in the first five years gives an idea of what is left in the hands of a relatively small number of rich people since the tax takes only 30 per cent of their gains.

Not socialist Their hoards in the past decade have been fabulous. What Callaghan does is to admit their right to these hauls on condition that they make a contribution to the national revenue, which is still at a lower rate than the standard rate of income tax.

The Capital Gains Tax, which is used by a number of other countries, including the USA, is no more a socialist tax than the income tax.

It does not, in any sense, prepare to expropriate big property owners. It only makes for greater equality in taxation between different sorts of capitalists.

As for the Corporation Tax, Callaghan describes it as a 'business tax incentive'. It amounts, in fact, to a reduction in profits tax.

The cessation in income tax concessions on entertainments and motor cars also pays lip-service to the idea of equality of sacrifice. Within the context of the tremendous inequalities of capitalism, these measures are quite phoney.

Skilful

There is a considerable difference between business firms which can no longer pass part of the cost of lavish entertainment on to the taxpayer, and the old age pensioner who now sees part of the recent increase going on higher prices for beer and cigarettes and all things whose prices have been going up in recent months.

The Budget changes have been skilfully presented to enable the government to oppose wage increases in the months ahead by claiming the measures taken were against the rich.

They will assist capitalism to face its crisis by holding down wages increasing the cost of living, cutting consumption and thus, they hope, increasing exports.

The Budget should not be isolated from the whole policy of the Wilson government since it came to power.

Some steps have had to be taken in the interests of business efficiency to begin a reform of the tax structure.

The working class is too strong to be taken on openly at this stage. If it can be offered no concessions or improvements, it still has to be approached with caution. As for the millionaires, monopolists and bankers, whatever some of their hot-headed representatives may say, they must be reassured.

Mr. Callaghan has certainly gone out of his way to do just that.

B/OSL FILE passed - by NALSO Correspondent AT their annual conference last week, the National Association of Labour Student Organisations passed a number of resolutions criticising the policies of the Labour government, calling for a programme of socialist nationalization and an end to the bans and proscriptions of working-class organisations at present operated by the Labour Party.

The main resolutions condemned the reactionary acti vity of the Home Office under Sir Frank Soskice, and deplored the anti-working-class attitude of the Labour government in its support of the glorification of Sir Winston Churchill.

Vietcong supported It deplored the actions of Wilson and Stewart, the oreign secretary, m supporl g the United States nolicv o aggression in Vietnam, and supported wholeheartedly the struggle of the Vietcong and the National Liberation Front to gain independence.

(Delegates strengthened their stand when they made North Vietnam's leader, Ho Chi Minh, an honorary president of NALSO.)

It strongly attacked Reg Underhill, the Labour Party Youth Officer, and Harold Simms, Yorkshire Regional Youth Officer, for their vicious witch-hunting activities in connection with the Young Socialists and Sheffield Labour Society (see last week's Newsletter).

Full support was given to Dr. Victor Allen and the three Nigerian Socialists in their fight against working-class opThe New A significant event trade union movement. ery day that the government of Harold Wilson is allowed to continue discredits the labour movement. In its attitude towards Vietnam it enjoys the full support of the Tories.

ALSO has indeed placed the blame where it rightfully belongs. It must now throw its full weight behind the struggle to change the policy of the Labour Party before it is too late. ' adopting Ho Chi Minh as its honorary president for the coming year, the Labour students have openly defied the right-wing witch-hunters at Transport House. They are following closely on the heels of the Young Socialists who long ago refused to Callaghan's crisis budget Ho Chi Minh made honorary president of NALSO pression in Nigeria. Conference also decided to support the campaign being conducted on their behalf by students of Leeds University.

A further resolution also recommended that the activities of Labour students should be directed mainly to the labour movement in general including the Labour Party, trade union movement and Young Socialists.

An emergency resolution which called for the NEC of the Labour Party to call a national conference, so that there can be full discussion of the Labour government's policies with the rank and file, was narrowly defeated.

Divided vote

THIS WEEK Page Page Page The right wing of the Labour Party has no organised support in most universities, but as the class struggle intensifies the right wing will make a bid for the control of the organised Labour students, employing the negative and destructive tactics used in the witch-hunt of the Young Socialists.

Win support

Thus the fight put up by NALSO against all bans and proscriptions must be fought through to the end, all the time winning support from politically conscious students as well as from the wider labour movement. Wilson-de Gaulle entente Trotsky confronts scribes Pacifism, Revisionism and the Negro Question Attack on Cowley strikers The seamen's struggle on Vietnam UN April 1, Labour Foreign Secretary Stewart received the highest paeans of praise from the Tories after opening the debate on the war in Vietnam. He reaffirmed complete support for the American counter-revolutionary war, and, as "The Times' put it, gave an 'almost clinically exact justification and defence of American policy in Vietnam'.

To quote from the Parliamentary record:

'Sir Alec Douglas-Home said that the House was immensely grateful to Mr. Stewart for the manner and the matter of his speech.... He found himself agreeing with almost everything that Mr. Stewart said....

'Sir Robert Cary (Conservative) said he wished to add his praise to the Foreign Secretary for his speech. When there was a fusion emerging between both Front Benches on the conduct of foreign policy, there was greater hope for the future' COMPLIMENTED Stewart was similarly comimented from the far right the Tories:

'Sir Tufton Beamish (Conservative) said that so lóng as the Foreign Secretary continued on these lines he would have the support of the Opposition. He himself had always been a strong believer in a bi-partisan foreign policy. He welcomed the fact that many aspects of foreign and defence policy were broadly along the lines on which the previous government conducted them.' The Tories recognise very well that the Labour government has sold out completely to the service of imperialism, and is prepared to go the whole hog in defending the bloody repressions and brutal experiments with chemical warfare which are being used in an attempt to beat the workers and peasants of Vietnam into submission.

They welcome, too, the sickly hypocrisy of Mr. Stewart's peroration in the House, when he ended his justification of this war with this passage:

It is the combination of imagination and resolution that can bring us up the long road that leads from a world disorganised, excessive in armaments and defective in prosperity, to a world so organised that the creative energies of man can leap forward to exalting the welfare of nations and the dignity of human life?

[sic] (Cheers).

This humbug was nicely unded off by Sir Alec Douglasame, who likes things repeated ce and simply; he pointed out:

'The critics of the United States should remember that Britain was in precisely the same position in Malaysia as the Americans were in Vietnam.' He might have added that there are 50,000 British troops in Malaysia, more than twice the U.S. force in Vietnam, all to assert the dignity of man.

Throughout the labour movement, opposition to the Vietnam Just two of the many trade union and Labour Party branches to join the tremendous opposition to the Vietnam war and anger at the Labour government's support for U.S.

action are the Brixton (London)

G/S branch of the ABU and the