(N.B. This post is not about social media. It is a political rant, but after last night’s initial election 2015 TV (non) debate, I just had to get it out of the system).
So – the campaign has started. As an electorate we now have the opportunity to see exactly what is on offer. There may be cock-ups, controversy, confrontation and commentary ahead, but there will be no ‘new’ policies. I put new in inverted commas since this pre-supposes the existence of some identifiable policies (as distinct from just initiatives) to start with.
So how do we all feel? Are we energised? Are we enthused about the debates to come? Do we sense that we are living in a vigourous democracy that thrives on the exchange of ideas? Do we even feel, as did the people of Scotland in their independence referendum, that there are clear choices presented to us?
Well, I will tell you how I feel. I feel as though I have been working hard all day with nothing to eat, have sat down at a table where I am promised a slap-up meal and then presented with … a plate upon which sits three crackers and a small piece of dried-up cheese. But wait, another plate is offered! And upon it sits … three crackers and a piece of dried up cheese. Yet the man who has given it to me declares, “behold, see what sits atop this cracker. Gaze ye with joy in your heart upon the sprinkled poppy seeds of a mansion tax! And next to it, the (dishevelled) lettuce garnish that constitutes a three-year freeze on energy prices!” In the interests of a balanced debate I must point out that the word dishevelled is my addition.
I don’t know what I was necessarily hoping for, I guess it was some discernible sort of policy response from the Labour Party that would provide the basis for a genuine debate, rather than just a sterile slanging match about cuts, tax and spending. No-one wants to talk about how much money we are not going to spend, (or why Ed Milliband looks grumpy) the issue we all want to debate is how to run the country because I think it is pretty clear to everyone that as a nation we are not in a good place. As a world we are not in a good place. Yet democracy doesn’t seem to be providing us with the spaces in which to debate the issues we all know we need to debate.
Worse than that a whole lot of stuff seems to have come about, none of which we ever voted for. A healthcare system mired in the bureaucracy of targets. An education system that isn’t actually a system, just a mess of competing alternatives dressed up as ‘a choice’. A society that allows the most aggressive and self-interested to reach the top of both politics and business. A society which has a denuded sense of collective interest or responsibility. A society where everyone is compelled to be in it for themselves. A society where wealth is associated with virtue and poverty is a sin. A society that is hungry for scapegoats (immigrants, benefits ‘scroungers’, Europe). And also a society which doesn’t have a car industry anymore (or at least not one actually owned by a UK company).
We didn’t ask for any of this. It just happened. But, this stuff didn’t ‘just happen’. And here is the problem: what is missing from politics is the story that explains to us why all this stuff ‘just happened’. And I think it is a story that is being deliberately pushed to the margins – by both Labour and the Conservatives.
The story is the story of markets, and how markets have come to rule not just our economies but also our societies. It is a story of how governments have become subservient to markets, to the extent to which, in this country, the very business of government itself and the provision of public services is being converted into one gigantic profit making opportunity operating in a ‘free’ market. Most of all, it is a story about who has come to benefit from the marketization of our society and why this explains how all this happened in the first place.
This is a story that started 30 years ago in the United States with an economist called Milton Freidman. It is an important story to understand because it will help you understand why all this stuff (just) happened and is still (just) happening. But most important of all, it is only once we understand this story that we will be able to create a space within which we can start to create new (and better) stories.
Milton Friedman was a professor at the Chicago School of Economics and economic adviser to Ronald Reagan. The Economist magazine has labelled him “the most influential economist of the second half of the 20th century…possibly of all of it”. Margaret Thatcher possibly had a picture of him on her desk, because she was very keen on his ideas. Milton almost certainly would have had a signed picture of Margaret upon his desk, alongside that of Ronald and also quite possibly Augusto (Pinochet).
Back in the late 1970s the old models of economics seemed to have failed. We were mired in industrial disputes, power cuts and the three-day week and Friedman seemed like a breath of fresh air. There were three elements to ‘Friedmanism’. The first was something that became known as monetarism and supply side economics. The second was all about unleashing the power of de-regulated, globalised, ‘free’ markets and the third was all about the role (or lack of it) of government itself.
The Thatcher Government went for monetarism in a big way, but when it basically failed to deliver on its promise of both low inflation and low unemployment, Thatcher shifted to embrace Friedman’s second idea – that of deregulated ‘free’ markets. Everything, from the City of London, to the NHS and public education were deregulated and marketised. The free market was seen as a one-size-fits-all solution to just about any problem.
The Thatcher and Major Governments didn’t get quite so far into Friedman’s third idea – that of the role of government. Friedman basically did not believe in government. He thought that government’s role should be restricted to protecting borders and maintaining law and order and that everything else should be left up to businesses operating in a free market. Thatcher was very keen to encourage entrepreneurship and business enterprise by removing red tape. She thought that The State should get-out of people’s lives as much as possible but the idea of actually dismantling the institutions of government was a bit too much both for herself and the party establishment. As a result, the main expression of this idea was privatisation. Rather than privatise government itself, Thatcher privatised the businesses that government owned (many of which should probably never have been owned by the government in the first place). Interestingly it was probably Tony Blair and his ‘public sector reform agenda’ that did more in this area through the introduction of business into aspects of the public sector through such things as Private Finance Initiatives (PFIs) and Public Private Partnerships (PPPs) and the acceleration of the contracting out of public services to private sector contractors such as Serco and G4S.
It was, however, the current government that has really focused on this one. Everyone likes to have a big new idea when they come into office, and David Cameron’s was The Big Society – remember that? In reality, the Big Society turned out to be the Big Business Society because while the ‘story’ was that government would devolve responsibility for providing services to local people and the third-sector, what got devolved mostly ended up in the hands of Serco, G4S, Capita et al or else just got closed down altogether. It was a nice-sounding front that allowed large parts of the business of government to be either turned into a business or to become a cost-saving. It is interesting to note that in the TV non-debate between Cameron and Milliband that marked the start of the campaign, David Cameron was asked whether he supported the idea of introducing more private companies into the NHS. He replied by saying he thought it was a good idea to introduce “charities and independent organisations”. He tried to make it sound all nice and cosy by invoking the role of charities and brushing over the private companies and profit bit by labelling them “independent organisations”. Yet another attempt to disguise or manipulate the story.
The language of the Big Society may have faded away, but the conversion of government into business opportunities has continued. Government is not so much being privatised as businessised. In a Today programme interview in 2013, David Cameron listed as one of his Government’s achievements “the breaking-up of the state monopoly over the provision of public education.” Is that how he sees public services, simply as monopolies to be broken-up?
As Education Secretary, Michael Gove was ultimately prevented from allowing profit-making organisations to deliver public education. But public education has been businessised none-the-less. Huge new academy chains or sponsors, which are really businesses in all but name with their CEOs and business managers, are eating up large chunks of the landscape. To borrow from the language of business (and why not) public education is being primed as a sector ripe for consolidation. Expect to see mergers between academies, the emergence of large regional or even national providers, multi-national media companies such as Pierson taking over much of the provision of course materials and contractors such as Serco moving in deliver everything else. Serco already run large parts of Ofsted. I was somewhat alarmed to discover that one.
Again, I could go on. I haven’t even dealt with the NHS. But it is worth remembering that the reason government has been doing this isn’t because this is something that has been proven to work, it is being done because the ideology says that it should work. Decisions are being taken about education that have nothing to do with how best to educate our children, they are being taken because the ideology says so, or even worse, decisions are being taken to try and make the ideology work. Our health service has basically been destroyed because the ideology said you have to break it up and introduce competition. Common sense will tell you that you don’t make something more competitive simply by introducing competition into it. But common sense is not ruling the roost. Ideology sits on the top perch.
How has this happened? And, in particular, why has this crazy ideology not been challenged or exposed – especially by the Labour Party?
To answer this question we have to get a wider perspective. Freidman’s ideas were not just taking root in the UK and the USA, they were being taken up everywhere – often on the insistence of institutions such as the World Bank and the International Monetary Fund. Probably the place where they were applied with most vigour was Russia, following the break-up of the Soviet Union. The group of Friedmanites know as the Chicago Boys (from the Chicago School of Economics) were flown in to basically take control of the Russian economy. Russia was seen as a great experiment for Friedman’s ideas – ideas which were now starting to be called neo-classical, or neo-liberal. Russia didn’t have a problem with government, because the government had basically melted away. It was therefore seen as a perfect environment in which an economy constructed exclusively around the neo-liberal model could rise from the ashes. One might say that this was an exercise in building on the ashses of one ideology by lighting the fire of another. This approach was called Economic Shock Therapy. It was basically a total disaster.
A small group of people, who became known as the oligarchs, ended up owning most of the State’s assets as well as some English Premier League football clubs. Large numbers of people were pushed into poverty, a form of gangster capitalism emerged, and the Russian state itself was pushed to the brink of collapse – thus paving the way for the emergence of Vladimir Putin as a populist strongman to impose some sort of order.
Or to put it another way, three things (just) happened.
- First – there was a significant transference of public wealth and assets into private hands.
- Second – there was an increase in the gap between rich and poor, with the creation of a new super-rich class at the top end and an underclass at the bottom.
- Third – there was a breakdown in the basic fabric of society, as measured by almost any index of social cohesion (mostly a rise in alcoholism and suicide in Russia’s case).
Public into private, increase in inequality, creation of a super-rich class, broken societies. Does any of this sound at all familiar?
In short, wherever these neo-liberal policies were applied, these three things almost always just happened and the extent to which they just happened was usually in proportion to the vigour with which the policies were applied.
I would draw your attention to the first two of these effects – public wealth being transferred to private hands and the creation of a new super-rich. No matter what sort of society neo-liberal policies might have predicted in theory, in practice they delivered an environment where the rich got richer. Markets could become mechanisms which act to protect and enhance the interests of those who are already advantaged. They also have the great advantage of allowing people to evade responsibility. Governments can step away from their responsibility to actually manage the provision of public services – the market can sort it all out from them. Governments don’t have to manage anything anymore, because you mustn’t manage markets – you can only regulate them. If things go wrong it is a market failure or a failure of regulation. A former policy adviser to Michael Gove has posed the key problem for provision of public education as “devising a system of regulation to detect failure early enough”. So rather than manage to promote success, we regulate to detect failure. And everywhere we look we see regulators – from Ofsted to Ofwat and Ofgen. CEOs can accept multi-million pound salaries because the market says it is OK. It is a great wheeze. Neo-liberalism is a game that has rules built into it that will ensure that the winners will keep on winning, no matter how badly they play. And that explains why all this (just) happened. No one really believes in free markets. The City ‘believed’ in free markets just so long as this provided a cover that allowed everyone to pay themselves huge salaries and bonuses. But behind the scenes everyone was busy abusing and distorting the markets and when the markets eventually did what markets will always do in this situation – i.e. collapse – everyone turned to us taxpayers and said “save us from the markets”.
Any set of policies that will ensure that rich and powerful people will become more rich and powerful are going to get a lot of applause (and funding) from the influential people in the posh seats. But we live in a democracy. People in the poor seats can also watch the show now. What were the people who are there to represent the people in the poor seats (i.e. pretty much all of us) actually doing? More specifically, what was the Labour party, i.e. a party that was founded to represent the interests of the non-rich and powerful, actually doing, especially since it was in power during a large period of when all this was (just) happening.
Now I am not especially anti rich and powerful people (provided they don’t take the piss). In this country we have a rich and powerful traditional of cow-towing to rich and powerful people and then cutting their heads off or kicking them out of the country when they take the piss. Long may that continue.
In fact we need rich and powerful people if we are to have a functioning democracy. Any democracy, if it is working properly will always produce a Conservative party – i.e. a party that primarily represents the rich and powerful. We and/or it, should not be ashamed of this fact. It will always be easy to ‘be’ this party because you will have the influence of the rich and powerful behind you. The great thing about democracies is that they provide a space within which parties and ideas can grow that represent the people who are not rich and powerful. And thus we have a balance. We don’t necessarily achieve this balance simply by swinging from electing one party to another, but because we have political debates within which ideas from both perspectives can be represented. In a democracy, being in opposition is in many ways at least as important as being in government. UKIP, for example, is currently demonstrating the power that comes from being in opposition.
This is the thing that the Labour Party forgot. Having been in opposition for quite some time and also having become envious of the fact that it is much easier to get elected if you have the influence of rich and powerful people behind you, the New Labour idea was concocted. It went something like this. We are the Labour Party: the party that was born out of representing the working people of this country and championing their rights in the face of exploitation by the rich and powerful (yada yada). But hey, things have moved on a bit. The dark satanic mills are now loft apartments. Everyone has colour TVs and goes on foreign holidays. We can cut the rich and powerful a little slack, in fact why can’t we all aspire to be rich and powerful. Why should the Tories just benefit from accessing the influence of the rich and powerful, why should not we (on your behalf, of course) siphon off a little of their influence and support? So even if we do end up basically promoting their interests, we can be assured that we are doing it in a way that is still fundamentally in the interests of the working people, because, after all We Are The Labour Party – just a New Labour Party. “Hi. I am Tony Blair. I am a nice guy. You can trust me. I am not one of those nasty Tories all mired in sleaze and complacency.”
The Labour party fell into the dreadful trap of believing that its actions could be validated on account of who or what it was, rather than what is was that it did. And what it actually did, therefore, was to not rock the boat. “Let us just drift along with the current of this free market thing” they said, “because provided we have a New Labour captain at the helm, it will all be OK.” Being in power, being the captain, therefore became the key thing.
Straying into what might be seen as the legacy of Tony Blair is a territory fraught with danger, but I think it is fair to say, that from the perspective of his political supporters (and there may indeed still be a few of those in the Labour Party), his greatest achievement was that he won three elections. He kept a Labour man at the helm. He wore the captain’s hat. Wearing that hat became (and remains) more important than where you steer the boat to – especially since the markets have already mapped that out.
We have been let down very badly and in many ways it is the Labour Party that has done this to us. It abandoned its post and as a result this space has become derelict. This isn’t about nonsense such as left wing or right wing, socialism or capitalism. It is about ensuring that democracy doesn’t become harnessed to promoting the interests of the rich and powerful, especially at a time when the rich and powerful have discovered a very effective means (neo-liberal, free market economics) of advancing their interests. This isn’t about a swing to the left or a return to the days of socialist ideology. The only reason that it might be portrayed as such is that there is nothing else to return to.
Post-war state socialism wasn’t the answer. It was based too much upon (another) ideology. But the people who should have been involved in building something better simply gave up and went to play with the rich kids because they got to play with better toys. As a result the rich kids’ neo-liberal game has advanced, essentially unchecked, for 30 years. It has been elevated beyond the realm of democratic debate and thus we cannot debate it.
You can’t blame the Tories, they were not the ones who abandoned their post. They were just doing their job, sticking up for the interests of the people they represent.
Which brings us back to the three crackers, poppy seeds and wilted lettuce. We don’t have a space any more within which we can construct new ideas and thus inject the necessary choice and opportunity for debate back into politics. It is all a shouting match about poppy seed and lettuce. We don’t have democracy, we have ‘free market’ democracy. Adherence to the ‘free market’ ideology has now become enshrined as a necessary pre-condition. When did we ever vote for that? We never did, it just happened. We don’t just have an unbalanced economy, we have an unbalanced democracy.
And we have now reached a dangerous position. We don’t want to get to the point where we cut people’s heads off, or create the space for a populist strongman. The ideological attachment of the current government to Friedman’s ideas has reached a level where some quite insane things are happening. In fact, where ideology meets reality it almost always produces insanity: be that the insanity of the five year plans of Stalin or Chairman Mao, or the insanity of the five year plans of Commissars Gove, Pickles and Hunt.
Business has become the filter through which we define the actions of government. We have moved from the point at which we have introduced business into the mix in order to better deliver what it is we want governments to do, to the point at which governments will only do what is that business can deliver. If a government service cannot be turned into a profit making opportunity, it therefore means, so the ideology goes, that government shouldn’t have assumed any responsibility for doing it in the first place and can therefore withdraw from such responsibility at will.
This is all crazy topsy turvey. Surely the whole point of having government is for it to do the things that business can’t. Public education is not the same thing as private education. Public healthcare is not the same thing as private healthcare. Markets can indeed do many things quite well, if carefully regulated, but they can’t do everything. That is why we have governments.
People can see that this is happening, but it doesn’t get much attention. The highly respected Kings Fund can release a report that shows that billions of pounds were wasted on a top-down re-organisation / destruction of the health service that didn’t work (and in any case we were told was not going to happen) and it is a headline for a day and then it fades away. The reason for this is that it cannot gain the support that comes from being part of a story. It becomes just another confusing event.
That is why it is so important to expose and debate, the real story. Neither of the mainstream parties want us to do this – for reasons which hopefully this post has made clear. They want to keep the story in the shadows or promote the lie that for last 30 years the problem has been ‘Big Government’. They want to take the peripheral issues and place them at the centre, whilst pushing out what should be at the centre to the periphery. So we debate whether tuition fees should be £6,000 or £9,000. We don’t debate about whether or not the state should provide university education for free, as it does for secondary education. That debate never happened.
Or else the political parties resort to spreading confusion. As senior Tory, Francis Maud said, “the problem with charities is that they are too dependent on the State.” And so the solution, according to David Cameron, is to make the State more dependent on charities. Confused? George Osborne will declare that the problem is not the recession caused by the collapse of global financial services market, it is the size of the national debt. And this debt has gone up, yet that still means the policies are working. It is all too confusing, all too hard. Anything to stop us from seeing the real story.
As one senior Labour politician (Peter Hain) said recently, “this is not about the politicians that you want, it is about the politicians you have got.” He might as well have said this was not about the politics that you want, but the politics you have got. You can have a cracker with poppy seeds, or a cracker without. Nothing else is on the menu. TINA politics – there is no alternative.
But there is an alternative – we just need to create the space that will allow it to develop, and the place to start is by exposing and challenging the story which has captured and degraded democratic politics for the last 30 years: the story of Milton Friedman and economic neo-liberalism. It is not about forcing David Cameron to take part in a debate, it is about forcing all politicians to have the debate about why all this stuff we never voted for (just) happened. The debate we want, rather than the (non) debate we have.