As a certain amount of contrived hysteria over the coming national postal strike circulates, there are two questions of absolute importance to bear in mind. What does Royal Mail's management want? And what does the government want? One part of the answer to these questions was furnished by BBC Newsnight last week (see report here), after an internal Royal Mail document was leaked to the programme. Entitled 'Dispute: Strategic Overview', the document lays out the plan for forcing the union to accept Royal Mail's terms for 'modernisation'. If the union did not accept Royal Mail's terms, management would just proceed to implement them regardless. The upshot of a complete success by Royal Mail management in this dispute would be the effective de-recognition of the union: forcing through major changes without negotiation with the workforce is exactly what companies without union representation are able to at liberty. This strategy, the document reveals, had the government's approval.

So, this is the first point: when you hear government ministers urge the CWU to 'return to the negotiating table', the reality is that Royal Mail management are the ones refusing to negotiate, with government backing. The business secretary and prince of the Brighton prom, Lord Mandelson, has already tacitly acknowledged the existence of the document, and ruled out the use of ACAS to arbitrate the dispute. The CWU has made repeated overtures, which have been rebuffed. This tendency on the part of Royal Mail's management to ignore conciliation and adopt bullying tactics is one reason why the vote for strike action was so overwhelming: 76% voted 'yes' for strike action.

In this connection, bear in mind what a future in Royal Mail without strong union representation would mean for a postal worker. It has been announced that Royal Mail has scrapped its anti-bullying week. The reason why this measure, among others, was introduced in the first place was because Royal Mail's management culture is one of the most retrograde in the whole of UK industry. Not only is the use of bully-boy management typical of the way Royal Mail handles disputes. It has long been part of the culture of management at sorting offices and depots across the country.

In 2001, an inquiry into Royal Mail's industrial relations by Lord Sawyer, Nicholas Underhill QC, and Ian Borkett of the TUC, was initiated by both the CWU and Royal Mail management to find ways to reduce the frequency of conflict (you can read the full pdf document here). This was after a series of unofficial actions brought sections of Royal Mail to a standstill - 95% of work days lost in 2000-1 were due to unofficial strikes beginning locally and then spreading through wildcat action. The report started from the assumption that workers' militancy was the problem to be averted, expressed disapproval of excessive worker involvement in managerial tasks, and was sympathetic to Royal Mail's 'modernisation' project. Yet, its findings highlighted an abysmal "authoritarian" culture in Royal Mail management, with managers insisting that workers ask for permission just to go for a slash or get a drink of water. Management knew how to apply punitive measures, even where they were inappropriate, but not much else. More senior managers, they found, were of a similar mentality. They refused to punish or confront "unacceptable behaviour" by frontline managers, evidently because they didn't find such behaviour to be "unacceptable".

What kind of behaviour might be hinted at in this cool terminology? Well, in 2003, it was disclosed that some 20% of staff had suffered bullying in the form of physical and mental abuse. Sometimes the abuse has taken on racist dimensions. In 2002, management had to make an unprecedented pay out of £100,000 to the family of a black postal worker who was driven to suicide after racist bullying by a group of managers. In another significant case, Mahmood Siddiqi was awarded almost £180,000 after it was revealed that he had been the subject of racist bullying for years that was condoned by managers on at least ten occasions when they might have acted to prevent it. Consider what might happen, with that sort of management culture operating without the constraints of a strong union. And think about that whenever you hear about 'union bullies', as you surely will.

Another part of the picture is that management want to reduce the cost of labour, to enhance the company's capacity as a profit-making institution. The inquiry led by Lord Sawyer acknowleged that aside from working in an unpleasant environment, postal workers traditionally suffer from low pay. The CWU points out that the average pay for a postal worker is much less than the average for skilled workers, even though managers enjoy lavish pay settlements with bonuses rivalling some of those bestowed on the oligarchs of the City. Royal Mail management would like to reduce workers' pay even further if they can, with proposed pay caps costing some workers £180 a week. This issue has been fuelling strikes across the country recently. (Royal Mail managers have responded to the strikes by scabbing). So, aside from job cuts, Royal Mail's current strategy involves forcing through a pay freeze, which is a de facto pay cut, while insisting on compulsory - but free! - overtime.

The next part of the story has to do with what the government intends to do with the postal service. Had Mandelson had his way, part of the Royal Mail would already be privatised. That had to be shelved last year, in part because of opposition from the backbenches. The major source of opposition to the privatization programme, though, is the organised Royal Mail workforce itself. So, in preparation for a renewed privatization drive, the government wants to decisively beat the union. Now, Mandelson has been very clear that this part-privatization proposal is just the first step toward full privatization. As Blair's secretary for trade and industry, he had always wanted Royal Mail "to be progressively private, even if if initially part of the company stayed in the Government's hands".

Already, the introduction of private competition has allowed companies like TNT and Citypost to bid for Royal Mail's more profitable contracts, while still using the Royal Mail's socialised infrastructure to actually deliver the mail. That has clearly been done in such a way as to make Royal Mail uncompetitive, and to blackmail its workforce into accepting changes that may not be for either their good or that of customers. Thus, in respect of the current strikes, The Guardian has reported - falsely, as it turned out - that the Royal Mail had lost a major postal contract for Amazon. The moral is clear, and cited by government ministers everywhere: strike, and people will just find other ways to get their mail delivered. Royal Mail managers have also claimed that the amount of mail being handled has declined, and that this in itself justifies substantial job losses in adaptation to a changing market. But postal workers have spotted the ruse behind this:

These myths - about union intransigence, about the economic necessity of job losses, about the superior efficiency of private competitors, etc. - are being deployed for the purposes of turning a low-cost public service provider into a marketplace of competing providers in accordance with the extraordinarily resilient neoliberal orthodoxy. This brings with it the usual problems - soaring costs, as companies seek to make a profit, duplication of capacity as they fight for market share, and poorer service as low paid, casualised and de-unionised workers are less committed to the job, and less likely to have the time and training necessary to develop their skills. Royal Mail, for all its faults, is one of the last bargains in town. Less than forty pence for a first class letter to anywhere in the UK is nothing. What else would you spend that money on? You couldn't even buy a pint of milk or a Mars bar with that money. Additionally, as much as businesses might whine when there is a strike on, capital makes a big efficiency gain with Royal Mail, especially if they use the metered mail service which gives them a further discount. Admittedly, the Royal Mail is not as cheap as America's socialised mail service, where a first class letter can cost as little as $0.44 (£0.27). But we can't all be as communistic as the yanks.

The government, you will be heartened to learn, has something else on its mind aside from prominently displaying its mean streak toward the disabled and single mothers. The cabinet has been sick with worry about your welfare in this recession. For this reason, the nationalised bank Northern Rock, having slashed jobs and shed mortgages from its books for months on end, is now offering some first-time buyers mortgages on 10% deposits. And the government has also persuaded Lloyds to expand its lending to consumers and small businesses, on pain of full nationalisation. Wonderful. Orgasmically peachy. The trouble is that in the current climate, no one wants to borrow, given the real knowledge that they won't be able to pay it back. Who would be a first-time buyer today, when 1.2m households are in negative equity? Who would borrow money for an expensive consumer item that didn't have to? As for small businesses, forget it. Business investment has shrunk by 7.7% across the economy over the last year. Demand is plummetting, there is tons of spare capacity, and businesses are more likely to sell assets and cut jobs than borrow more to invest more.

But before you go drawing the conclusion that senior ministers think in terms of amusing demographoids such as ‘Vauxhall Man’ and ‘Bognor Regis Woman’, and designs policies on the basis of flattering said specimens’ alleged ‘aspirational’ propensities, please consider the stimulus. Because, after all, a giant middle finger aimed in your direction can be quite stimulating. Aside from the fact that the supposed spending increases comprise cash that was already in the pipeline, brought forward a couple of years, don't forget that the Chancellor is still intending to cut public spending by £5bn this year. Schools and hospitals, the latter already suffering from the burden of soaring PFI costs, are expected to fare the worst. There’s your stimulus – do you feel that? So, with unemployment expected to reach 3 million next year, and with the government pushing through cuts in public services and welfare, where are these millions of confident, spendy consumers going to come from to bail out the economy and get investment flowing again? It seems that the government is essentially committed to restoring the City of London and the housing market to their prior importance after the recession. They still think they can rely on the financial sector to generate jobs, and a strong housing market to give people collateral to borrow against. This is the only explanation that I can think of as to why they are still committed to keeping even the worst banks alive as profitable enterprises while refusing to do anything substantial about the massive housing crisis that the country faces.

And even as the government rushes to repeatedly inject billions into the financial system and (temporarily) nationalises failing banks, the rush to privatise existing (and comparatively well-functioning) public services continues. 30% of Royal Mail is to be sold off, following up on the pre-Xmas orders of the latte-moustached Secretary of State for Business Peter Mandelson. This is ostensibly to help recoup sufficient funds to make up for the pensions deficit and introduce modernising measures. The trouble is, the government has already pledged to fund the deficit, and all it is doing is handing over a profitable part of the enterprise to a private company. Taxpayer still gets milked, private capital gets the cream. It has absolutely nothing to do with pensions. This is a move that the government is by no means obliged to undertake. It is not politically popular, it will split the Labour Party, and it has galvanised serious opposition even among ordinarily spineless backbenchers. 125 Labour MPs have signed motions against the policy, and even that former left cheek of Blairism John Prescott is opposed to the plans. The government will have to rely on Tory votes to push the policy through. So, the government's slogan come election 2010 will be: "If you value it, vote for it; then we'll smash it up and sell the parts."

Still, at least you can rely on the government, having alienated voters on the left, to pander to voters on the right who are going to vote Tory anyway. Thus, even as the flow of migrant workers decreases sharply under the impact of recession, the Home Secretary still wants to ban thousands of them. That 'British jobs for British workers' bollocks has a lot to answer for. Meanwhile, Hazel Blears, having been taken to pieces by George Monbiot, is preparing her comeback as an archnemesis of political-correctness-gone-mad, in a madcap re-enactment of Margaret Hodge's campaign to give half of her constituency over to the BNP. When this bizarre mix of haughtiness, arrogance, elitism and pseudo-populism leads to electoral annihilation, Blears will be the first one to blame it on the government's refusal to use her purloined Jimmy Carr jokes in the campaign.