What Labour must learn from the unions

The TUC has dominated the news all week.

The very welcome election of Frances O'Grady as general secretary, an economic strategy including a serious proposal on public ownership of the banks, looking beyond the October 20 march For a Future that Works to an alternative economic future and a commitment to industrial action to oppose austerity were all highlights.

Most of the media, which dominates so much popular political thinking and is the source of so many prejudices, started the week with a discussion of the "relevance" of unions and falling membership.

You would have thought experienced commentators might connect falling membership with falling employment, but no.

As long as unions have been around there have been attacks on their "relevance." Their existence has always been under legal threat from the Combination Acts beginning in 1799 - "an Act to prevent unlawful combinations of workmen," the first was called - right through to Thatcher and her anti-union laws of the 1980s.

To its shame new Labour failed to repeal those laws, and British unions work under the most restrictive conditions of any in Europe.

The language used in relation to trade unions is amazing and absurd. Every general secretary is termed a "baron" and personally held responsible for all the failings in their industry or service.

The fact that trade union leaders have to be elected by an independently verifiable process is ignored, as is the fact that the number of full-time union officials is very small.

The reality is that trade unions are the Big Society, and have been since long before a speech-writer handed the term to David Cameron.

Unions consist of volunteers helping others and trying to ensure justice is done. But you'll never read that in the Daily Mail.

Trade unions represent over six million workers in Britain and have always had a huge influence on life in this country.

They founded the Labour Party and without them we would not have a national health service or a welfare state. We would never have seen vital legislation on health and safety, welfare at work or redundancy payments.

We wouldn't even have weekends.

But their power is limited by the nature of our society and their influence on the Labour Party, far from being excessive, is much too weak.

A whole host of issues carried at TUC this week commit the new general council and general secretary to big campaigns ahead. Unions are making the essential demands needed to protect the welfare state and prevent further attacks on it by the coalition - and going further to challenge the banking philosophy that dominates this government.

October 20 will be a huge and very important day. Hopefully it will be even bigger than March 26 2011 was, but more importantly we need it to encourage a growing movement against austerity, not a one-off show around the streets of London, however welcome that might be.

The ostensible reasons for the austerity packages wheeled out by the government and imposed on health, education and local services are the debts of 2008.

But the solution of cuts in public employment, a reduction in real income levels and increased charges for everything does not stimulate growth. It has the opposite effect.

Even more extreme cuts in Greece and Spain have neither reduced the debt nor improved job opportunities.

With a quarter of all adults out of work - rising to half among young people - this is the grimmest time since the 1930s.

Young people in later school years, at college or at university fear for their future.

Older workers are terrified of losing their jobs and effectively retiring at 50 or 55.

Those in desperate need of somewhere decent to live are equally fearful.

While the last Labour government did introduce a deeply flawed form of public ownership of the banks, former chancellor Alistair Darling promised greater cuts than Thatcher's during the last election.

Even now the Labour front bench complains about cutting "too far, too fast" - it doesn't challenge the principle of austerity itself.

It is worth thinking for a moment of the winners in this situation. As with the US in the 1920s and '30s, millionaires are created out of misery from a combination of a grossly unfair taxation system and an ability to pay ever lower wages, reducing employment costs.

The reduction in the top rate of taxation is a gift - as Ed Miliband has pointed out - of £14,000 a year to the big earners.

The tax havens that even government advisers like Philip Green keep their money in are thriving as we are told that "trickle-down" economics will help the poor.

It doesn't and it won't. Tax relief on charity donations are no substitute for a properly funded welfare state, proper employment rights and investment in young people.

The mood of many in Britain is not "more of the same, but a bit less" under a future Labour government. People want something much more radical.

While the plethora of think tanks surrounding the political class busy themselves with complex proposals we should be proposing something far more significant. To unite those facing job losses, hospital closures, benefit cuts or library sales, an alternative strategy needs to be offered that includes public ownership and control of the major banks as well as a commitment to the redistribution of wealth in our society.

In Parliament on Tuesday there were two opposition motions up for debate. Both were critical of the coalition, but they showed a depressing lack of ambition and scope.

The first, on universal credit, was introduced by Liam Byrne. Universal credit attacks the budgets of the very poor and by linking income-related benefits to housing costs is a massive assault on the poorest inhabitants of high-cost areas such as London. Byrne's motion ought to have read: "We oppose universal credit."

Instead, it restricted itself to the costs of introducing the new scheme and the staffing consequences of it. It also asked for more details on the implementation plan.

The second motion was introduced by Shabana Mahmood and called for reducing tuition fees by introducing a cap of £6,000.

That would undoubtedly be better than paying £9,000 - but it's a far cry from the universal and equal access to higher education that is a long-cherished aim of the labour movement.

At the end of this month the Labour Party conference meets in Manchester. How much better it would be if the speakers on the platform condemned austerity and did not call for wage increases but addressed not just "predistribution," but the distribution of wealth as a whole.

Jeremy Corbyn is Labour MP for Islington North.