“Everything that becomes true starts with a manifesto”
“I write a manifesto and I want nothing, yet I say certain things, and in principle I am against manifestoes, as I am also against principles.”
Neoliberalism is based on 19th-century ideas associated with laissez-faire economic liberalism and free market capitalism such as privatization, austerity, deregulation, free trade and increasing the role of the private sector in the economy and society. The term itself in the form “néo-libéralisme” was introduced by a number of French economists in the late 19th. Century before being taken up by Friedman. In its modern manifestation it reflects the ideas of the Mont Pelerin Society, a group of economists, philosophers, politicians and business leaders which has been meeting since around 1947 with the aim of providing an alternative paradigm to the then emerging Keynesian consensus. Its theoretical underpinnings rely principally on the works of Friedrich Hayek, Milton Friedman and Ayn Rand. Early attempts to implement it as policies took place in post-war Germany as part of the Wirtschaftswunder (“economic miracle”) and in Pinochet’s Chile in the 1960.
In the late 1970s and onward it was taken up by leading politicians and central bankers such as Margaret Thatcher, Ronald Reagan and Alan Greenspan. It was successful, in their terms, leading to a period of sustained economic growth. Features of its practical implementation were:
- Mass privatisations of public services,
- Sustained attacks on Trade Unions and organized labour,
- Almost complete deregulation of the financial services sector,
- Support for globalization,
- Austerity to keep down wages and free the rich from the burdens of taxes to, supposedly, concentrate on investment and growth,
- Free Trade areas and treaties,
- Military intervention and regime change in non-cooperating countries which had useful resources.
Being based on classic Libertarian principles the size of government was diminished; its major roles now being to promote free market competition, keep trade unions powerless and direct social and physical infrastructure towards satisfying the needs of the big global corporations.
Neoliberalism became the economic and political orthodoxy. It was virtually the only system taught in universities and much of its propaganda was based on the idea that “There is no other way.”
One of the supposed benefits of neoliberalism was to avoid the classic boom and bust cycles. This appeared to be working, creating one long boom, until the massive crash of 2007–2008 showed that it had in fact just postponed the minor busts and rolled them all into one major one! From that point on the cracks started to appear until, by the time of writing (early 2019,) it has been largely discredited in academic circles although it is still hanging on in political and business circles. It has made a few individuals extremely wealthy; that wealth imbues them with great power without the normal systems of checks and balances. These people clearly have no reason to want to change the system which has benefitted them so enormously, and they have the power to maintain the system long after it should have been replaced or at least drastically modified. The problems of neoliberalism can be quite simply be summed up: it has broken the world.
The State We’re In (A)
“There is one consolation in being sick; and that is the possibility that you may recover to a better state than you were ever in before.”
Henry David Thoreau
Broken Money System
“Money doesn’t talk, it swears”
Money is debt. The popular idea that money grew as an adjunct to barter systems, and that credit is a relatively modern invention of the later mercantile and capitalist systems, is a complete fallacy. From the earliest available records we see details of debts and obligations being recorded. Money has always had a triple purpose as medium of exchange, a measure of value and a reification of credit.
It is a long time since money held any intrinsic value. For some time it was commodity money, backed by something of actual value, usually gold or silver, but it is now mostly in the form of fiat money, that is it has value solely due to the backing of the government that issues it and that value can vary according to the actual or perceived performance of the economy overseen by that government. Governments, however, do not create money except in the very minor matter of producing notes and coins. Since the beginning of the twentieth century money creation is in the hands of private banks, who create new money in the form of a debt owed to them by their customer every time they make a loan. Although that money may be repaid, that is generally because other new money has been created, possibly as a loan to a company that pays wages. Even if we look at a perfect system where the money is recycled, there is still interest to be found from somewhere. Consequently the money supply must always grow. As the money is spent, demand is created which will usually cause a rise in prices as supply balances the demand and so we have inflation. This is an unstable and unsustainable system. Inflation does not occur at the same rate across sectors creating imbalances which need continuous attention and often go out of control. Further this is a system that requires continuous and increasing growth; eventually anything of value has to depend on the human and material resources available; potential infinite growth within a finite world is obviously not possible and at some point the entire system must collapse. This system is under the control of a few very wealthy and powerful people. One of the main powers they have is the ability to directly or indirectly determine their own remuneration and that of their friends, a power that they use with great relish to give themselves even more wealth and power. Nominally such large remuneration should depend on results which means increasing returns, thus further fuelling the insane rates of growth and hastening the end.
Broken Financial System
“New Golden Rule of Fractional Reserve Banking: He who creates the ‘fool’s gold’ controls the fools.”
For decades after Breton Woods, the world economy worked on a system devised by Maynard Keynes (and others) with currencies pegged to gold and the US dollar, with the IMF and World Bank to even out any inconsistencies that arose. A trade cycle was introduced where the USA, and to a lesser extent the UK ran a trade deficit, importing goods from the major producing countries, mainly Germany and Japan. In return the countries running surpluses invested the excess back into the financial markets, run almost exclusively by the USA and UK, making up for their deficit. The news would run stories about the “Balance of Payments” problem, and how it was all OK really because of the “invisible earnings” from the services sector. This was, of course exactly how it was supposed to work but it laid the foundations for the deliberate policy decisions to run down manufacturing and boost financial services. As an open policy this could be unpopular and provoke a backlash, particularly from the trade unions, but by blaming the unions for failing to provide productivity gains and painting the financial institutions as saviours it would not alienate the electorate.
This worked well for a while, but in 1971 Richard Nixon unilaterally removed the convertibility between the dollar and gold leaving the US dollar as the world’s reserve currency and forcing others to float their value compared to it. This was good for the USA, not so good for everyone else, but was part of the drive to increase the power of the American Hegemony whose progress had been somewhat stalled through the activities of the USSR. The trade cycle continued however until the advent of the neoliberal consensus in the 1980s and 90s, with the massive increase in the power and wealth of global corporations who wanted to syphon off as much as possible into their own hands. In addition the world had moved on. The USSR had fallen but Russia began to re-emerge. China went from strength to strength with an economy set to overtake the USA in a few years. It is now more important to sell goods into the Chinese market than the American. India, Brazil and many other countries began to flex their economic muscles. The EU tried to separate trade from politics, creating a single market with no political oversight, then a currency with a Central Bank similarly outside direct political influence. The USA, with inward investment falling began to face political problems at home. The countries that had previously invested in the USA wanted to invest more in their own countries and extend their spheres of influence. More and more wealth, power and influence was hoovered up into clutching hands of the global corporations and a handful of by now obscenely rich individuals. Protectionism has reappeared and the prospect of trade wars. The old Breton Woods based system may have had many faults, but it was at least agreed and on the whole maintained cooperatively. Now there is nothing but a blatant grab for power and wealth with little or no control or protection for ordinary citizens.
Broken Political System
“Vote for the man who promises least; he’ll be the least disappointing.”
Neoliberalism has always been the enemy of democracy. If everything has to be left for “the market” to decide, then that leaves no scope for people to intervene and make different decisions to what the market ordains. Furthermore it is a long term project that requires consistency across the relative short term lives of governments. Once complete control has been relinquished to the market and its servants it can be relatively easy for them to retain it. The amount of money and power available for use, combined with the overriding need for growth and profit can easily overcome any attempts at oversight on moral or ethical grounds.
The way to privatise a public service is well documented by, among others, Noam Chomsky: first starve it of funds so it begins to fail and people get angry; then use your propaganda machine to put out the idea that a privatised version will be better. At the appropriate time sell the public some shares at a cheap price so when the price goes up they sell quickly to make a big profit and the shares end up with the big pension funds and other private equity companies where they were meant to go all along. Then set up a toothless regulator and watch as the quality goes down, the prices go up, the already rich make yet more money and the public actually think they got a good deal. As the realisation eventually dawns no one wants to admit to being conned. It is grossly unethical but it is legal and it makes a profit and that is all that counts.
The cry that “it’s legal” or “it isn’t against the rules” resound throughout Westminster and the equivalent political pseudo-towns in other countries. Whether it be expenses, conflicts of interest, failure to declare outside earnings or misleading (i.e. lying to) Parliament, if there is no specific law or regulation to forbid something then that automatically means it is OK to do it. If a rule is actually broken then all that is needed is something that by some stretch of the imagination could be construed as an apology and then just carry on making sure not to be caught next time. For example, MPs with large financial interests in healthcare companies get to vote on selling off parts of the NHS, and in some cases they get to actually run it. MPs with large financial interests in the arms industry likewise get to vote on buying armaments for our forces and selling them to other countries.
Lobbyists have easy access to MPs and government ministers and can quite openly buy favours. Many MPs take on lucrative consultancies and directorships and become lobbyists themselves.
The first-past-the-post voting system exacerbates all these ills. A minority of votes in a general election can elect a party with a large majority. Control of the state machine combined with an efficient propaganda machine can usually ensure control through more than one election cycle giving time to cement changes so that a new government will need to spend time and resources dismantling them. In fact changes in government are usually not that significant; the lure of money, given the extraordinary amounts available, can suborn most people so that when, inevitably, a ruling party falls into decadence, the opposition can be readily formed into a continuation of the same regime with only cosmetic differences. When Margaret Thatcher claimed Tony Blair as her greatest success, it was not her personal achievement but that of the neoliberal system she had introduced.
The first-past-the-post voting system also extends the propensity for deception. It coerces parties into large monolithic coalitions of factions, that can differ widely, in order to muster sufficient members to form a majority. Before an election all those factions must agree on a compromise manifesto and it is extremely unlikely that everyone will agree to all of it, often there may be policies that nobody wants simply because nobody can accept anything offered by the other factions. During the election, however, candidates are all forced to campaign on that manifesto as though they believed all of it wholeheartedly, defending what they do not necessarily believe. It is no surprise that politicians are among the least trusted of professions. By contrast, in a proportional representation system with a multiplicity of smaller parties, all candidates can campaign on what they actually believe. After the election there will, of course, have to be the same or similar compromises made in order to achieve a working majority, but they will be made openly without compromising principles. Everybody understands the need for compromise; anyone with a family or friends will be negotiating compromise all the time. There is no need to do it behind close doors and pretend that reluctant compromise to achieve some progress is actually full agreement.
The large monolithic parties are much easier to control, not only by their internal leadership but external forces trying to gain influence. It is much easier, and cheaper, to buy one or two strategically placed politicians who can then bring the entire ruling party with them, than to have to deal with a larger number of disparate politicians with different desires.
Broken Civil Service
“A civil servant is sometimes like a broken cannon — it won’t work and you can’t fire it.”
George S. Patton
The British Civil Service, as immortalized in “Yes, Minister” and “Yes, Prime Minister”, used to be one of the wonders of the world. They were led by a group of bumbling amateurs, virtually all from the Clarendon schools and Oxbridge, whose major qualifications came from the contacts they built up over the years. Beneath them were a slightly more competent group from the lesser public schools and the occasional grammar school and the “other” universities whose main task was to try and appear to satisfy the demands of arrogant, self-serving politicians who neither had nor wanted any form of expertise in the areas under their control, without causing too much damage. Somehow they managed to hold together “the greatest empire the world has ever seen” without causing any major disasters (except to the unfortunate native inhabitants of the colonies, but they didn’t matter.)
British Industry was run on similar lines, but survived because of the continuous flow of cheap raw materials from the colonies which also formed a captive market to sell manufactured goods back to, at great profit. There was more money to be had in industry, but in compensation work in the Civil Service could guarantee some form of honour: knighthoods and the occasional peerage for those at the top, sundry letters after the name for the others, and of course a decent pension.
This all changed with the end of empire and the neoliberal revolution. British industry had to survive in a global market on equal terms with everyone else. Those that didn’t modernise quickly went under or found themselves gobbled up by foreign multinationals and either forced into line or asset stripped. The Civil Service also had to change. The top ranks still came mainly from the same public schools and Oxbridge, but they had to work a bit harder. In the top and middle ranks the vastly inflated salaries available in industry could not be adequately compensated by any honours system, besides which honours were as easily come by for those in industry, all it took was a few donations to political parties or the campaigns of influential politicians. The major power remaining to the civil servants was the administration of the huge government contracts. To avoid a complete exodus of all remaining talent out from the civil service the “revolving door” policy developed whereby individuals could move freely between public and private sectors. This meant that someone could give the government advice on which company should get a big contract, then move out and work for that company and possibly be brought back in as a consultant to advise the government on the next phase of that contract or new similar contracts. The classic example is the “big four” accountancy firms who employ most available tax expertise. They supply consultants who advise the government on tax policy and its implementation, then return to advise their private customers on how to make use of the loopholes they have just created, to avoid paying their taxes. There is, of course, meant to be a “Chinese Wall” separating those advising the government from those advising private customers, but anyone who has ever worked in a company where one of these is supposed to operate will know that it only means being careful about who knows what is going on. There is of course nothing that should interfere with maximising shareholder value. It is a frighteningly corrupt system.
“Just because something isn’t a lie does not mean that it isn’t deceptive. A liar knows that he is a liar, but one who speaks mere portions of truth in order to deceive is a craftsman of destruction.”
The circulation figures for newspapers, with one or two exceptions, show a marked annual decline. The British Press is the least trusted in Europe. Even the Guardian, for so long regarded as more reliable because it was managed by a trust and not by private individuals, is no longer trusted, or indeed trustworthy. It is virtually impossible to make a profit from a newspaper; they nearly all make quite considerable losses. The people who own and run most of the papers are among the rich and powerful leaders of the neoliberal, free market, world. They do not continue with something that makes a loss out of the goodness of their hearts, they expect something in return. In this case the returns come from having a platform to expound their own views, and the power to affect events, that comes from their ability to influence a still sizeable number of people.
The BBC is biased, though which way depends on who is talking. In a classic BBC fashion, they claim that complaints of bias from both sides of the political divide must mean they are striking the happy medium. In fact, a known bias towards the left among creative people and intellectuals is reflected in the BBC’s drama output and some documentaries. Threats to the licence fee and looming prospects of privatisation have enabled right wing infiltration into the upper echelons and news service. Audience figures for its news services have shown a steady decline, though not as steep as for the written press. This, however, masks a greater problem as the demographic studies show the BBC, and other TV audiences are predominantly from the over 60s. Younger viewers now increasingly use online TV services such as Netflix for general viewing and social media for news. The budgets for BBC News services have been regularly slashed, which has meant that outside the big headlines it is rare for them to actually get the news from their own correspondents; they have to take what is on offer from other news services, the written press and often publicity material from the very people they are supposed to be reporting on.
The overall effect has been to merge content with editorial. The old days of “all the news that’s fit to print” have gone. No longer can you rely on a paper or TV station giving all the facts, then adding additional comment, probably biased, but at least in a known way. Now the news that does not fit your bias is ignored or the facts manipulated, and the consumer is led to believe that an extremely biased interpretation of events is actually full coverage.
The BBC, and other media organisations have used extensively the techniques of “framing” and differential interview mannerisms to great effect. There could be, for example, two people being interviewed from both sides of the political spectrum. One will be interviewed with relatively straightforward questions, and will be allowed to speak without interruption while the interviewer sits back smiling and nodding; the other faces a barrage of difficult questions, is continually interrupted while the interviewer sits forward jabbing at the interviewee with finger or pencil. Behind one interviewee will be nice pastel colours and/or a pleasant scene, behind the other will be angry or even bilious colours and/or a scene designed to arouse anger or disgust. The media organisation can put their hand on their heart and claim to have fulfilled their obligation of impartiality, because they have given equal time to the two sides, but they will have actually inflicted a heavy bias in order to sway the audience in the desired direction.
Another commonly used technique is differential selection of interviewees. From one side will be chosen someone who stands strictly for the party line, from the other someone from an extreme wing who is known to disagree with their party line. When some form of expertise is needed, on one side you may have an expert with great technical knowledge but little experience in presenting their point to a less knowledgeable audience pitted against a politician with zero technical knowledge but a lifetime’s experience in being able to present a case carefully prepared for them by their researchers.
Yet another technique is to present something where there is near universal agreement, just one or two mavericks as though it was close to a 50–50 split with genuine disagreement. This has been especially used in arguments about climate change and a classic case was the fuss about the triple vaccination. In that last case someone with a poor research record, who had previously been found falsifying results, and with a clear conflict of interest, had taken advantage of a coincidence. This was that a new vaccine had been brought out at the same time as a new test for autism which allowed diagnosis at an earlier age and detected more sufferers. The age of testing was coincidentally the same as the age of vaccination. This then produced a spurious correlation between the new vaccine and increased numbers discovered with autism which was used to try and imply a non-existent causal link. The opportunity for headlines pointing out possible dangers to children was too much for the media to resist. As a direct result levels of take up for the vaccine fell, in some areas to below the limit for herd immunisation with the result that there have been several unnecessary outbreaks of disease with the resulting death of some children. No action has ever been taken against the media organisations, who had a direct responsibility because they grabbed for a sensational headline without doing anything like the necessary due diligence.
The replacement source for news is the Internet, and particularly social media. This has the great advantages of immediacy and a direct contact between the news source and the consumer. It does, however, introduce a new problem of validation. It is only too easy to lie online and people use this to spread disinformation, and also to denigrate genuine sources with which they disagree. It is not too difficult to track down and distinguish genuine news; it just takes time and effort, precisely the same techniques as used to be done by reporters: look for multiple sources and check their reliability, then follow a story forwards and backwards to provide context. Most people do not have the time to do this, so a new phenomenon has emerged, the private news aggregator, who trawls through social media, carries out (hopefully) the due diligence and then presents their selection “so you don’t have to.” Of course, as you might expect, unscrupulous organisations now pose as independent news aggregators to try and get over their biased message, and so the world moves on…
“There is no such thing as society”
The recent report by the UN Special Rapporteur on extreme poverty and human rights on conditions in the UK was a damning indictment of the government’s policies over the last few years. In response the Work and Pensions Secretary attacked the report writer for taking a “political” stance and tried to ridicule the report’s findings. It seems that causing extreme poverty, premature deaths and abject misery throughout what is purportedly the fifth wealthiest nation on the planet is not only acceptable behaviour, but reasoned, evidence-based and wholly impartial criticism of the policies that caused this appalling state is also not to be allowed.
This follows on from the case where the same individual, then as Home Secretary, carrying out a policy initiated by the current Prime Minister had attempted, and in many cases succeeded, to deport a number of genuine British Citizens, people who had specifically come here at our invitation to help us at a time of need, and their descendants, because they did not have the papers to prove when and how they came. The fact that the Home Office had deliberately destroyed those papers and told the people that they were not needed did not make any difference. British Citizens, many elderly, who had been born in this country were deported to countries with which they had no connection, where some died. Rather than apologize and provide compensation, the government continued the policy and had to be forced to stop by legal action. Despite the demonstration of illegality, the policy continues.
These examples illustrate a great divide between government and governed. Money is the only measure of worth; if you have none then you are worthless. All thoughts of honour and decency have vanished from all but a small number of those we are supposed to look up to. Lies, deceit, fraud, bribery, blatant conflicts of interest are all not only acceptable but commonplace. Serious criminal activity is no bar to a successful public career; friends in high places and the media will look after you provided you continue to toe the party line. Anyone who shows the slightest sign of decency will be pilloried, laughed at, and every attempt made to drive them out. Honours, the services of politicians and civil servants, elections can all be bought. With money and a good propaganda machine anything is possible.
This is sick and decadent society in which we live.
“All things share the same breath — the beast, the tree, the man… the air shares its spirit with all the life it supports.”
Chief Si’ahl, Dkhw’Duw’Absh tribe
The problems of climate change and global warming are well known. Sadly there remain some people who refuse to believe what is happening in front of their eyes, and people prepared to give them a platform.
Near universal acceptance of the existence of man-made climate change is one thing; getting governments to actually implement policies is something entirely different. Every politician is happy to proclaim their green credentials, but none of them wants to be the one to tell their electorate that they must stop using their cars, stop flying on holiday and pay more for a smaller variety of food.
Species are disappearing to the extent that the world is thought to be approaching a new mass extinction event. Sea levels are rising, threatening coastal cities and some island nations. Weather patterns are changing causing more and more dangerous natural disasters. Yet the release of pollutants, the over consumption of resources and the production and subsequent dumping of unnecessary and long-lasting chemicals continues.
The most optimistic say there is still time to turn the situation around, though there is no real evidence that that is happening to anything like a large enough degree. The pessimists say that it is already too late.
“But the age of chivalry is gone. That of sophisters, economists, and calculators has succeeded; and the glory of Europe is extinguished forever.”
In 1951 the Treaty of Paris created the European Coal and Steel community. The vision of its founders, notably Robert Schuman and Jean Monnet was to tie the nations of Europe, principally France and Germany, together economically in such a way as to preclude the possibility of another war like the two that had blighted the continent in the first half of the twentieth century. The Treaty of Rome in 1957 extended economic cooperation and saw the formation of the European Economic Community. Alongside economic cooperation there was increasing cooperation in foreign affairs and in justice and security which led to the renaming as the European Community and the incorporation of these “three pillars” in the Treaty Of Maastricht in 1993. Finally this all became a single legal entity as the European Union in the Treaty of Lisbon in 2007. Along the way many additional states had joined making a total of 28. 19 of these formed a common currency union and passed much fiscal policy into the hands of the European Central Bank.
The EU was created as a neoliberal institution, with Margaret Thatcher playing a leading role. There are some elements of the original Schuman-Monnet vision remaining: the free movement of labour, working times directive and rulings against some of the big global semi-monopolies, along with the persistence of some elements of state support for industry and nationalised public services. If degrees of neoliberalism are possible, this places the EU as slightly less neoliberal than the nation states of the USA and UK. Given the artificial construction of the EU, without any of the historical underpinnings of a state, it is not surprising that the strains of the impending collapse are showing here most openly, and where the first fault lines are appearing.
The workings of neoliberalism require the close cooperation between government, central bank, private banks and global corporations. Introducing what is almost a government and taking away control of the currency from the individual nations has proved extremely divisive. The largest economies, particularly Germany, want, and are getting, a system that benefits them enormously. Making the most profit in the largest economies obviously has the biggest effect on the overall balance sheet. This does not go down well with the markedly different and smaller economies of southern Europe. Countries with a stronger tradition of socialist or social democratic governments face social discontent after the imposition of the inherently right wing policies required.
In the former colonies in the Middle East and Africa the big corporations, strongly associated with the former colonial masters, are continuing to remove the natural resources at an ever increasing rate, for knock down prices, by the use of bribery through puppet regimes. These unfortunate countries are beginning to dissolve into a new set of wars as populations sought the freedom that was still denied to them. Many of the poorest of these countries are among those worst hits by the impact of climate change, caused by those same ex-colonial powers (and the USA.) Faced with extreme poverty the only solution for many is to grab what belongings they have and head north towards Europe. Internal divisions as to how to cope with this remorselessly increasing tide of immigrants and disparities between internal nations and those with external borders continue to grow.
This has all led to a rising tide of nationalism and populist governments who do not want to uphold the EU rules. France is facing great difficulties because it cannot match the rates of economic growth shown by Germany and its attempts to keep up have caused greater levels of austerity and open revolt by a large proportion of its population. France and the UK have both faced the problem of maintaining their status as world powers as their economies, relatively, slip ever downwards in the world rankings. The only way to maintain their position has been to rely on military power which, in the age of expensive, technologically advanced weaponry, has to be funded by arms sales to anyone who will buy, regardless of any ethical considerations. The original, admiral, aim of binding the economies of France, Germany and the others is unravelling as the global corporations increasing move towards a new eldorado in Asia while the attempts to move towards a European neoliberal state founder against the rocks of old-fashioned nationalism.
Where We Want To Be (B)
How many goodly creatures are there here!
How beauteous mankind is! O brave new world,
That has such people in’t.”
“In the absence of justice, what is sovereignty but organized robbery?”
Sovereignty is the authority of a state to govern itself and make its own laws; it is also relevant to consider where, in what people or institutions, that authority resides. States may voluntarily pool parts of their sovereignty, or they may devolve parts of their sovereignty to internal subdivisions. So, for example, the UK has for a while pooled large parts of its sovereignty with the other states in the EU. The existence of article 50, however, guaranteed that ultimate sovereignty lay back in the UK, because we could always leave and reclaim what had been pooled. The UK has devolved parts of its sovereignty to Scotland, but ultimate sovereignty resides with the UK, Scotland cannot declare independence or even hold an independence referendum, without the permission of the UK government. In practice it could do so but that would be an act of rebellion.
The question of where sovereignty lies in the UK is not clear. The sovereign has the power to dismiss a prime minister, and to dissolve parliament. He or she also retains control over the armed forces so that theoretically they could enforce any laws they wished to make without recourse to ministers or parliament. The Prime Minister and the rest of the government are supposedly able to wield the sovereign’s power, though, theoretically, for some things they could be required to seek the sovereign’s approval with the threat of changing the allocation of powers if it were withheld. Parliament has the power to remove the Prime Minister and government and, supposedly, it has control over the money supply and hence the power to make the government ineffective. The people have the power to elect a Parliament occasionally, but not to remove one. The judiciary can basically do what it wants, with a minimal level of oversight from both government and Parliament. Some powers are devolved to Scotland, Northern Ireland and Wales, and a few to other local authorities. This system could be described as “the way we have always done it”, “the oldest democracy in the world”, neither of which is true, as a robust system of checks and balances that has stood the test of time, or simply as a mess.
Sovereignty in the UK is supposed to lie with Parliament, though successive governments have managed to shift much of the power from Parliament to themselves, so it is unclear whether this remains true. Recent events would seem to indicate at best a stand off, with possibly the government edging it. However we do claim to be a democracy, which means “power of the people” or specifically “a system of government by the whole population or all the eligible members of a state.” In other words “Parliamentary democracy” could be considered a contradiction; if sovereignty lies with Parliament then it does not lie with the people, regardless of whether or not the people have a role in choosing their representatives.
This problem arises partly because of the difficulties in actually exercising the powers of sovereignty. Consulting the people about every small decision, or even every large one, is too difficult so, very conveniently, it is regrettably necessary to concentrate power into the hands of a few people. This may remain the case but only giving people the opportunity once every five years to make a single choice between two large, comprehensive and mainly untrue manifestos in the face of an unrelenting media onslaught from people whose entire experience and expertise has been in the arts of persuasion is not giving power to the people. Consulting all the people can be an expensive and time consuming process, but it is not necessary to consult everybody every time and, although technology has not yet advanced enough to enable complete quick and easy online voting, it should certainly be able to streamline procedures securely.
For a nation to truly be a democracy, the ultimate power and responsibility must lie with the people; any representatives are merely a convenience to help efficient operation of the machinery of state and must remain subservient to the will of the people. This means that it must be possible to recall representatives who no longer properly represent their constituents and, if necessary recall an entire Parliament. Referendums may not be popular, nor easy to manage, but in the relatively rare cases where major issues with serious ramifications for everybody cannot find reasonable levels of support across Parliament then there has to be a way to consult the people directly.
“The difference between involvement and commitment is like ham and eggs. The chicken is involved; the pig is committed.”
Neoliberalism is the enemy of democracy. Democracy requires that decisions be made using different criteria than just profit. Democracy requires politicians to attend to the needs of their constituents and not to take money and instructions from lobbyists for the big corporations. Democracy may want public control of key services, regulation and accountability where neoliberalism wants privatisation of everything, deregulation and accountability only to shareholders.
When someone has to work very hard to make ends meet there is little time left to be involved in politics. When politicians set out to make what they do sound complicated, it is no surprise that people prefer to leave it to them rather than trying to understand what is being done to them and in their name. The end result is that public interest in politics declines, turnout for elections is reduced and the voters are easier to mislead by whoever has the most money and most efficient propaganda. Apart from 2010, when the government was formed by a coalition of two parties, the last time the winner of an election had more than 50% of votes cast was in 1935. This means that governments are claiming mandates for what are often extreme policies from a minority of votes cast. Turnout in the UK averages 72.9% and can often fall below 60%. In many “safe” constituencies the result is a foregone conclusion and many will not bother to vote. The result is that elections can be won or lost by influencing the vote of a relatively small number of people, which is much cheaper and easier to do. A very large proportion of the electorate is effectively disenfranchised.
While the supposition is that an MP represents all of their constituents, this only applies in practice to a tiny proportion of Parliament’s affairs that directly affect that constituency. For important national issues an MP only represents the interests of those that voted for them, and often only the actual members of their political party. For most people the MP is a distant irrelevance, they may not even know his or her name; an MP will be described as “a good constituency MP” if they are one of the rare ones that actually do their job properly. Yet these same constituents are being affected, often very seriously, by the decisions being made at Westminster.
Westminster itself, often referred to as a “village”, is an incestuous mix of MPs, civil servants, lobbyists and journalists who speak their own language, rarely mix with others and regard themselves as inherently superior, on the rare occasions they put in an appearance in front of the rest of us. Politicians from an elite background, having been to an elite school and an elite university, then straight into Westminster, claim that they understand the problems of those living in extreme poverty in rundown areas.
It is vitally necessary that people should be given the education to understand the workings of a society, all the information available to enable them to make rational, informed decisions and the opportunity to come together to help make those decisions. They must also see that their opinions are properly taken into account in decision making.
“He is richest who is content with the least, for content is the wealth of nature.”
The pursuit of wealth has become the main preoccupation of most of humankind. In some places it is a universal obsession, as in the “American Dream.” In other places, such as much of Europe, a more class based society saw an elite concentrating on their personal wealth at the expense of the lower classes and particularly their colonial subjects, who scrambled around to survive with an ideal of some form of security from outright poverty. Some countries and isolated rural communities have maintained some form of subsistence economies in which, given reasonable conditions, people can be content with relatively low levels of inequality. The number of these has diminished as the outside world tries to grab what resources they have by bringing them in as subordinate partners in a larger global economy. It is difficult to resist the bribery offered to any country’s leaders, financing regime change for any that resist, and the full force of propaganda/advertising promising the wonders of modern technology to the general population.
The creation of wealth has been taken from governments and any semblance of democratic control and placed into private hands. It cannot surprise anyone that those wielding that power should be concentrating on creating wealth for themselves and not for everyone. It is quite amazing that, despite all the evidence, it is still put forward as a valid theory that allowing a few people to just give themselves everything they want will actually filter down to provide some increase in wealth for everyone.
Wealth creation has to be taken from the private banks that currently wield that power, or at the very least it should be tightly regulated and democratically accountable. The institutions that handle wealth creation and manage its distribution as investment in public and private enterprises must be non-profit-making to remove any taint of corruption or conflict of interest. Private banks should return to their original role of managing finance for private individuals and companies.
Globalisation, Internationalism and Cooperation
“No generation has had the opportunity, as we now have, to build a global economy that leaves no-one behind. It is a wonderful opportunity, but also a profound responsibility.”
“Our global economy is out of control and performing contrary to basic principles of market economics.”
The grand vision after World War 2 was to minimise the possibility of war by tying all nations together economically. The European Community was one part of this, but also the defeated nations, principally Germany and Japan, would be helped financially to rebuild and take a major part in the cycle of world trade developed at the Bretton Woods conference. The newly independent colonies from the old European empires would be helped to move towards modern market economies to replace their previous controlled or subsistence economies. The United Nations would oversee and police the emerging new world order. That did not work for many reasons, among them the maintenance of huge military industrial complexes requiring continual wars to justify their existence, and the concentration of wealth and power in a few global corporations who along with some countries were too big to be effectively controlled.
There has to be some effective way of enforcing international law; no single country can be the “world’s policeman.” Global corporations need effective global controls to prevent them playing one country off against another and moving their operations to wherever maximises profit ignoring the effect on people. International standards must be agreed and enforced.
Globalisation has to come to mean the coming together of people to look after the world and make progress through peaceful cooperation. It must no longer mean the concentration of the world’s wealth in the hands of a privileged few, while maintaining division among the mass of people to avoid dissent.
“Freedom is never voluntarily given by the oppressor; it must be demanded by the oppressed.”
Martin Luther King, Jr.
These five freedoms should provide a minimum base from which to build a better world.
Freedom From Fear
People must be free from fear of war, natural disasters caused by manmade climate change, food scarcity and water shortages, racist, colonial, sexual or any other form of violence, militarized borders.
Freedom From Toil
No one should have to spend their time doing useless toil. Useful work should be shared equitably among all who can and want to do it so that everyone can enjoy the world.
Freedom to Move
The ability to move around the world should not be constrained by wealth. Public Transport should be free and everyone able to visit friends and family, see the sights of the world subject only to constraints of conservation of the environment, live anywhere subject to constraints of availability.
Freedom From Domination
Domination can be by dictators, bosses, majorities, racial or patriarchal divisions, religions, individual bullies and, of course “the market.”
Freedom to Live
Everyone must have access to all the basics of life, education, art and all the wonders of the world. They must have the opportunity to better themselves and create a better life for their children. They must have hope.
Getting From A To B
“Another world is not only possible, she is on her way. On a quiet day, I can hear her breathing”
The Kilburn Manifesto
“The window logs Kilburn’s skyline. Ungentrified, ungentrifiable. Boom and bust never come here. Here bust is permanent.”
The Kilburn Manifesto is a sequence of documents produced a few years ago by a group of sociologists (who happened to all live in, or close to, Kilburn) who analysed the success of neoliberalism as a sociological phenomenon and offered a few, admittedly somewhat vague, ideas about how to counteract it. The major premise is that a neoliberal social settlement has replaced the previously existing social democratic one based on a welfare state. This has moved the idea of common sense away from ideas about community and fairness towards individual freedom, choice, self-interest and an acceptance of market forces as natural. This new social settlement has so far survived major financial crisis, a shift in economic power into Asia and a massive redistribution of wealth upwards to the extremely rich.
The focus of public debate has to be shifted towards the benefits of collectivism and solidarity, particularly as regards the politics of gender and race. The vocabulary of economics has to change away from the concepts of debt and profit towards a proper accounting of the effects of types of economic activity on people and the environment. In particular the attitude to tax must change away from being an imposition to be avoided if at all possible, towards the more Scandinavian view that it is the glue that holds the society together, a contribution to the welfare of all.
The Piketty Manifesto
“We want capitalism and market forces to be the slave of democracy rather than the opposite.”
Thomas Piketty has been studying the causes, extent and effects of inequality, in particular the move towards greater wealth equality, progressive taxation and democracy, as a result of the wars and economic disasters of the first half of the twentieth century, followed by the exact opposite after the neoliberal revolution of the 1980s. Now, along with Antoine Vauchez, he has come up with a “Manifesto for the Democratisation of Europe”. Though concerned principally with reform of the European Union, which they regard as extremely urgent with the removal of the UK, possibly followed by other countries, the rise of right wing extreme nationalist parties through much of Eastern Europe and the ever widening economic gap between the North and South of the continent.
This is not a detailed manifesto full of policies but a call to replace the Lisbon Treaty with a “Democratisation Treaty” and the creation of a sovereign European Assembly to debate, vote on and subsequently manage a “Budget for Democratisation.” The assembly would comprise around 80% parliamentarians from each member country according to population and party allegiance and the rest elected as for the current European Parliament. This would align policies of Europe and the member countries more closely. The fact that it is sovereign marks a clear separation of powers between it and the sovereign governments of the member countries and diminishes the power of the European Council, shifting much decision making from government ministers to parliamentarians. Its control of the budget and a requirement to oversee all Europe wide decisions also diminishes the power of the Commission and allays the current criticisms of effective rule by an unelected body.
The Budget for Democratisation would be raised by progressive taxes on profits of major firms, the top incomes, the highest wealth owners and carbon emissions. This budget would finance education, investment in projects to reduce inequality, improve democracy and transform the economy and the reception and integration of immigrants.
Although specifically aimed at Europe, the proposals are applicable elsewhere, for example for a federal UK.
European Spring is a Europe wide organisation, effectively a political party, organised by a small group of progressives, principally Yanis Varoufakis. Its intention is to put forward candidates in all countries in forthcoming European elections. Its policies have, to some extent, been determined by all its members contributing online.
The Progressive International is world wide organisation set up as an attempt to counteract the global corporations and their supporting political organisations. It is headed again by Yanis Varoufakis and Bernie Sanders. Its ideas and aims seem interesting and worthwhile, but it is as yet far too early to predict what, if any, success it may have.
The Green New Deal and MMT
“The Green New Deal we are proposing will be similar in scale to the mobilization efforts seen in World War II or the Marshall Plan. We must again invest in the development, manufacturing, deployment, and distribution of energy, but this time green energy.”
Alexandria Ocasio-Cortez is a charismatic young US Democrat, known by her three initials, AOC. Unfortunately she is too young to stand for president this time, or the next. Her main policy platform is the Green New Deal which is an idea that has been around for a while, being championed since 2007 in the UK by the Green New Deal Group headed by, among others, economist Richard Murphy. The proposal is quite straightforward, that by a type of deficit financing as used by Roosevelt in the original new deal of the 1930s, a massive effort should be made to eliminate the pollution of greenhouse gases by investment in manufacturing, agriculture transport and all other sectors along with a shift to 100% renewable energy production. It also comes with a jobs guarantee.
The problem with all such policies is always seen, particularly by its opponents, as how it can be afforded. The fact that when a country such as the USA or UK wants to fight a war then the huge sums required can always be found, is conveniently forgotten. The current neoliberal economic policies rely on the banks creating money in the form of debt to finance their own transactions and speculations, while government spending, which should be minimal, comes out of whatever can be raised by taxation. When the government is running a deficit, which is described as a debt (to the banks), the overriding necessity to pay it back requires austerity measures in order to lower government spending even further while, hopefully, increasing tax revenue from those unable to avoid paying. This nonsense is based on the thoroughly discredited Laffer Curve, a classic example of confirmation bias, which is always trotted out to show how cutting taxes for the rich actually increases tax revenue. It is symptomatic of the parlous state of our society that such a theory can attain preeminence despite a total lack of favourable evidence and vast amounts of contrary evidence.
Modern Monetary Theory completely turns this prevailing orthodoxy on its head, and while it is not a prerequisite for the Green New Deal they are usually connected in order to answer the question of how to afford it. In MMT, money in the form of fiat currency is created by the government inserting it into the economy by public spending; that public deficit then equals a corresponding private surplus which is available to spend on goods and services and keep the economy moving. The government recoups some of that money by taxation or by issuing long term bonds; the tax obligation provides the incentive to keep introducing money and fuels the cycle. As the money issuer, the government cannot go bust, or even be in debt, however by the laws of supply and demand, if it issues more currency than the actual trade in goods and services requires the result will be inflation, and it is that which provided the check on the government just “printing money”. Taxation is no longer an obligation on the private sector, but the policy tool to regulate inflation and unemployment.
“Direct action is, ultimately, the defiant insistence on acting as if one is already free.”
General dissatisfaction and disillusion with the normal political process has led to low turnouts, particularly among young people and the lower income groups, many of whom do not even bother to register to vote. This makes radical change less likely by the standard means, most voting power residing in the older, more conservative, section of the population. This, combined with the power exerted over politicians by the few very rich people and the global corporations and media that they control, can cause a sort of despairing resignation and acceptance that there is nothing that can be done. In these circumstances many who refuse to just tug on forelocks and put up with the austerity and enforced poverty feel they have to resort to direct action. This can range from peaceful demonstration to outright riots leading to revolution.
History has shown that little is actually achieved by peaceful demonstration. Authorities and the media often ignore them. The only interest is when the usual groups, who like to take advantage of a crowd to indulge in provocative action, start using violence, and when the police over respond. If there is sufficient public feeling and demonstrations become large enough and frequent enough then there can be a threat of violence which can be enough to provoke police into preemptive action which may calm things down but leave a legacy of mistrust for the next time, or actual violence can break out. When feelings are running particularly high then violence may erupt with very few preliminaries. Prolonged large scale violence, such as the Gilets Jaunes in France, will usually lead to some form of political change whether it be policy reversal, the fall of a government, or a lasting bitterness and animosity between government and governed.
Although politicians will always claim that there is never a need for violence, there can come a point where it is the only alternative to subservience and decline for a section of society. Governments implementing austerity policies will also oversee an increase in deaths and illness through underfunding health services and the benefits system. The harm that this does is never described as violence, no matter how many people end up suffering or dying; it is always allowable and justifiable. If people who have no hope, in despair protest in the only manner open to them that will actually have an effect, then this is, of course, not allowed and unjustifiable.
Universal Basic Income
“Basic Income is not a utopia, it’s a practical business plan for the next step of the human journey”
The idea of a Universal Basic Income is old, but many feel its time has come. It can involve anything from what is almost a jobs guarantee to universal cash handouts. It garners support from both sides of the political divide; those on the right see it as a possibly cheaper form of welfare which guarantees a plentiful supply of consumers for the market to supply; on the left it is seen as a way to end poverty and allow everyone some human dignity. There have been a number of experiments to test its viability, most being very positive. Preliminary results from the recent large scale trial in Finland have shown no significant drop in the numbers of those seeking employment, no significant extra costs but a marked increase in general well being reflected in lower costs for health, education and policing. It cannot be a panacea, and needs to be implemented as part of a package of reforms. For example means testing is a very costly exercise and so best avoided, but that means rich people get paid as well as the poor which, in a rampant neoliberal economy like the UK, means that a substantial part will just disappear into tax havens, paid for by the poor. With a decent progressive income tax with a high rate for high earners, it would virtually all come straight back.
“I’m deeply worried about what our outdated, dysfunctional electoral system is doing to the legitimacy of our governance system.”
The first past the post system used in the UK is not fit for purpose. Mandates are claimed for extreme policies based on a minority of votes cast. There are very few checks and balances built in; once a government has a majority it can do what it likes, completely ignoring any manifesto promises. Many people are effectively disenfranchised and/or not properly represented. It is democracy in name only, which, of course, is exactly what is needed by a neoliberal system where decision making needs to be with company chief executives, or at least in the boardroom, not with people who might negatively affect profit. Most of the developed world uses some form of proportional representation, where the result more clearly reflects the actual vote. Governments are often coalitions which act against extreme policies and maintain continuity from one government to the next. Large constituencies with more than one MP can usually guarantee that constituents can connect with someone close to their own beliefs.
“Everything will be tokenized and connected by a blockchain one day.”
Blockchains came to everyone’s notice with the coming of bitcoin and other crypto currencies, but it has much wider uses and ramifications.
The world now runs on data, there are masses of it and large proportions of the world’s resources and people’s efforts are used to store it, access it, copy it and use it. Someone who has control of your data has significant power over you. Traditionally data is stored in large central databases; access has to be jealously guarded and anyone who can break in has a treasure trove at their fingertips. Copies have to be kept to avoid loss, thus increasing security problems, and it has to be moved about in bulk, again causing security problems. The system relies on trust, often misplaced, that whoever holds the data will look after it and not misuse it.
Blockchains change that by distributing the data so that many people hold copies, in a securely encrypted form, any changes have to be made to all copies, so everyone who has a copy has to agree to make that change, and all activity is recorded in the chain. You no longer have to trust that the data is secure and used properly, there is a mathematical proof that that is the case. It is in a sense the democratisation of data. There is a price to pay; the amount of processing power and storage is increased which means more energy consumption and possible pollution.
Conclusion — Mending the World
“If something can’t be fixed with duct tape, then that means you aren’t using enough duct tape”
The demise of capitalism has been decreed many times in the past, but it has shown a remarkable resilience and ability to reinvent itself. From the mercantilism of the 18th century through the industrial revolution and the growth of manufacturing, followed by the move to financial services and then to neoliberalism and a system based on trade in derivatives. Estimates of the size of the derivatives market vary from 10 to 20 times the value of the world economy and its value is measured in quadrillions; that wide variation showing how little it is controlled or regulated. This unimaginable amount is not actual money, nor is it virtual money, nor is it services based around the movement of virtual money, or virtual services based on actual services; it is virtual aggregations of virtual services manipulating actual services involving virtual money. It is Monopoly™ money, except that the people playing the game have so much power that at any time they can decree the equivalence of their game money to real money and use it to buy actual goods. The goods they buy tend to be those with some form of permanent intrinsic value: gold, silver, gems, rare metals, land, buildings and works of art. This guarantees that they can remain rich and powerful even after the inevitable collapse.
If capitalism is to survive the coming cataclysm then it will have to rebuild itself so much that it would no longer be reasonable to refer to it by the same name.
Up to the point of neoliberal ascendancy, the changes in capitalism had run in parallel to a slow, gradual move towards some form of “social democracy”. Throughout much of the world poverty was reduced, general health and education improved and although it could and should have gone a lot further and a lot faster, it was still enough to keep the capitalists in power despite the move to increased democracy. This changed. For many, health and education levels are decreasing; for the first time for centuries, in the most extreme neoliberal countries, the USA and the UK, life expectancy has decreased. It is no surprise that neoliberal politicians have talked about a return to Victorian values.
It is difficult to see how the current system can make the necessary changes to avoid the worst effects of climate change. Companies that try to make the first move immediately lose competitiveness and must either reverse or go under. The only way can be by massive government spending to offset any loss in competitive advantage, but that carries the same difficulty unless every country moves at the same time. Anyway, such intervention cannot be allowed without a change in economic system.
Time is running out. It may be possible to effect enough of a change by voting in socialist, or at least strongly non-neoliberal, governments in a few key countries leading to a domino effect. Unfortunately many countries are moving the other way, voting in extreme right wing neo-fascist governments in the mistaken hope that nationalism will protect them from the upcoming collapse. The only alternative would seem to be violent revolution to overthrow the new “Ancien Régime”. It has happened before!
In later essays I will start to assemble some practical suggestions as to the way forward from here.