Within a week the Tory government will have ti announce its detailed plans for Phase 3 of its all-out attack on the wages and conditions of the working class (officially known as the anti-inflation poliey"), which is due to come Into force on November 1. In the past week sturtling economic news has revealed how the condition of capitalism in Britain makes it urgent that this attack be stepped up.
Apart from a disastzous set of new trade figures which sent the value of the pound tumbling once again, there is a much more alarming piece of news. The total value of national production, after rising for a year at about 4 per cent (the so-called "boom"), actually tell between the first two quarters of this year. The Tories' 'commitment to growth' has in the last six months actually produced economic decline. This is not too surprising given that the purchasing power of the working class has been severely reduced by the wage laws, and invest. ment has never recovered from the previous slump of 1970-71, OUTPUT AND PROFITS But declining output is the wont possible news for the Tories Phase 3 strategy. With output rising rapidly (as it was up to about March) it was possible, by balting the rise in real wages and then reducing them under the Phase 1 and Phase 2 formulas, to allow all the increase in ¿be value of production to acerue to profits. As a result the share of profits in the national Income, which had been halved between 1964 and 1970, and had failed to recover up to the end of 1972, increased somewhat in the fist balf of this year. The share in 1972 was about 10% per cent; in the first hall of 1972 it was over 11 percent This increase, which is also seen in soaring profit figures for a number of individual companies, has partly been made possible by