1. FREE-MARKET FUNDAMENTALISM GONE MAD
Blog 1 of 3 in the INDIVIDUTOPIA series.
We live in a neoliberal era. And neoliberalism, in case you’re unaware, is dangerously ideological.
This belief states that the private sector is always efficient, even when it is not. The public sector is never efficient, even when it is. Greed is always good, even when it isn’t. And the state shouldn’t interfere with the market, even when it should.
This fanatical faith in the free-market is based on the assumption that if we allow businesses to do their thing, the economy will grow at a faster rate, even though it probably won’t. Neoliberalism’s disciples like to quote the “Trickle Down Theory”: The idea that the wealth created by private businesses will end up in workers’ pockets, as if by magic, even though this doesn’t actually happen.
The free-market fundamentalists, with religious devotion, believe in a God-like “Invisible Hand”, which they say will take care of the economy, just as long as governments don’t get in the way. They believe everything should be privatised, and the private sector will do the rest.
Margaret Thatcher once said, “The problem with socialism is that you eventually run out of other people’s money”. Well, the problem with neoliberalism is that eventually you run out of national assets to privatise. Then you come face to face with the stark reality: The private sector can be inefficient, and the public sector can be efficient…
In Britain, a clear example of this private-sector inefficiency can be seen in the rail industry, which was privatised in 1997.
Since then, the service has hardly improved: One in three passengers on commuter trains to London are now unable to get a seat. Fares haven’t become cheaper. In fact, prices have skyrocketed: British commuters now spend up to six times the amount on train tickets, as a proportion of their pay-packets, when compared to their neighbours in Europe. And government subsidies haven’t reduced: They were six times higher in 2013 than in 1996. (Guardian).
Perhaps the most bizarre case is that of the East Coast line, which was brought under public control in 2009. Public bureaucrats turned the failing line around, made it profitable, returned millions of pounds to the treasury, reduced its reliance on subsidies, and introduced discounted fares. Under public management, it had the highest customer satisfaction ratings in the land.
What did the neoliberals do?
Ideologically in love with the private sector, even though it had failed, they immediately re-privatised the line!
And what happened next?
It failed in the private sector once again!
You really couldn’t make this stuff up.
But this is not a lone example.
When RBS went bankrupt, in 2008, the government took it over and returned it to health. Having failed in the private sector, it turned a profit when run by the state. And then what happened? It was handed back to private-sector profiteers, so that they and not the British people could benefit.
Only last week, G4S lost total control of one of their prisons. The government has now had to step in. You can bet it’ll be back in private hands just as soon as the issues are fixed.
But it’s not just the railways, banks and prisons which can be more efficient when run in the public sector. Take a look at these statistics for healthcare, which compare the UK (where it is nationalised) with the USA (where it is privatised):
The UK, which only spent $3,405 per person a year on healthcare, topped the charts in several areas (including “Efficiency”). The USA, which spent $8,508 per person a year on healthcare, came near the bottom.
And yet despite this, every effort has been made to privatise the British healthcare system from within; introducing internal markets and outsourcing services. There is even demand amongst some Conservative MPs to introduce fees for patients to see their GP.
It’s not rational. It’s not efficient. It’s ideological extremism, plain and simple.
This quote from Barack Obama was telling:
“Everybody who supports single-payer health care says, ‘Look at all this money we would be saving from insurance and paperwork.’ That represents one million, two million, three million jobs [filled by] people who are working at Blue Cross Blue Shield or Kaiser or other places. What are we doing with them? Where are we employing them?”
Here, Obama is clearly stating that he accepts it would be more efficient to nationalise the American health service: It would save millions of pointless jobs. With a state supplier, you wouldn’t need so many insurance companies, those firms wouldn’t need administrators, people to respond to claims, or salespeople to entice new customers.
But that’s exactly why Obama wanted healthcare to remain in the private-sector! He wanted us to continue working pointless jobs, in the private sector, even though it’s totally inefficient! He didn’t care about efficiency. He just wanted us to work for the sake of working — to be subservient wage slaves, dependent on corporations to survive.
This is the exact opposite of what we were promised by the private-sector ideologues. The likes of Thatcher pointed to Keynesian and communist systems, said they contained far too many pointless bureaucrats, and told us these jobs would be abolished in the private sector.
But they still exist in their droves!
In his book, “Bullshit Jobs”, David Graeber gives examples of five types of jobs which (according to the people who do them) don’t produce anything of value at all:
· Flunkies: Jobs which exist to make a boss or company look good, such as a glamorous receptionist.
· Goons: Jobs which exist because other firms have them. If your competition has telemarketers, then you need telemarketers to keep up, even though it’d be more efficient if neither of you employed such people.
· Duck Tapers: Employees who fix problems which only exist because cost-conscious firms have cut too many corners in the first place.
· Box tickers: People who spend their lives filling in forms, tabulating data and writing corporate reports.
· Middle management: People who supervise staff who don’t need supervising. (Real News).
A recent poll in the UK found that 37% of workers felt their job made “No meaningful contribution to the world”! (Daily Beast)
This is before we get onto the subject of jobs which don’t just produce nothing, but which produce things which are socially undesirable: The arms dealers who sell weapons to murderous regimes. The oil firms who pollute our planet. The raft of sales and marketing professionals who subtly coerce us into buying things we don’t need, with money we don’t have.
At the heart of their ideology, the free-market fundamentalists believe that it is competition which drives efficiency.
In fact, they’re so in love with the idea of competition, they don’t just want firms to compete, they also want employees to compete within those firms; placing them under immense pressure to do better than their colleagues and top the company charts.
But there’s a problem here: When you tell an employee you’ll judge and rank their work according to one key metric, they tend to focus on that metric, which can distract them from doing the things which really matters.
One of my first jobs as an adult was in a chain pub. The firm used “Mystery Shoppers”; people disguised as regular punters, who judged and ranked the manner in which you served them.
One of my co-workers had a particular knack for spotting these mystery shoppers. He would pick them out and serve them first, overlooking genuine customers who had been waiting longer. He would be extra friendly and attentive, which ensured he got the highest marks.
The company, using feedback from their mystery shoppers, thought this employee was doing a fantastic job and gave him a promotion. They were completely oblivious to the fact he was pretty lazy most of the time, took lots of breaks, and chatted with his favourite customers when there was work which needed doing.
Meanwhile, hard working employees, who tried to offer great service to everyone, and do the hard graft behind the scenes, often got worse grades and found themselves under pressure from management.
This is not a unique tale.
I’ve seen this in marketing roles I’ve had, where workers were pushed hard to make sales in the short-term, alienating their clients, when it would have been better to nurture relationships and sell more in the long-run. Apparently Chief Executives feel under so much pressure to deliver short-term profits to shareholders, they can forgo investment opportunities which may yield far great profits in years to come. Most firms are too myopic to see that by driving down wages, people (their customers) will have less money in their pockets, and so there will be less demand for the goods and services they are trying to sell.
Still, the neoliberals love this rankings-based approach. Since it was born in the private sector, they simply can’t conceive that it might inefficient. They’re even pushing it onto what remains of the public sector…
Rather than try to mould their pupils into happy, free-thinking, upstanding citizens, teachers are now being placed under pressure to focus solely on getting them the highest grades in academic exams. Like in the private sector, both they and their schools are ranked in charts.
I recall the story of one of my friends, who was stopped from taking his A Levels because he had been predicted low grades. His school didn’t want his grades to pull down their average, which would have cost them places in the inter-school rankings, so they stopped him from getting any A Levels at all; forgetting to help the very people they were employed to help: Their students.
Doctors are now under pressure to reduce waiting times for operations, which are also ranked. This means a doctor must choose between completing small, less significant operations, to get people off their waiting lists, and longer operations which may actually save lives, but will result in longer waiting lists. Dentists have to endure an equally ludicrous points-based-system.
This sort of private-sector inefficiency is rife within our economy, and it’s spreading into the public sector, but its rarely talked about in the mainstream press. For the neoliberals, private-sector simply inefficiency doesn’t even exist. “All hail the free market,” they’ll say. “Long live the entrepreneurs!”
Joss Sheldon’s new novel, Individutopia, deals with the themes introduced in this blog. It’s set in a neoliberal dystopia, in which everything has been privatised, all jobs are bullshit jobs, and everyone must compete to top an infinity of pointless corporate charts.
To read blog two in this series, on “The Self-Made Delusion”, please click here.