Unemployment is a free market failure

As unemployment rises inexorably towards three million in the UK the government has no answer. That is hardly surprising because this government is so intent in worshiping at the altar of the market that it believes that governments can't and shouldn't' do anything - that is the job of the market. So we can't expect much from this government except the harassment and impoverishment of the unemployed and those on welfare as I described in this post on the government's latest so-called 'welfare' reform.

The unemployed are the ones who are paying the most for the banker's recession. By being shut out of paid work they will suffer hardship, low esteem and health problems, often brought on by malnutrition. Malnutrition is estimated to affect three million people in the UK and cost £7.3 billion. Yet another cost dumped onto society by capitalists.

Capitalism has always lead to unemployment. In fact there was no unemployment before capitalism. It is a feature of the capitalist economic system described by Marx over a century ago:-

"....it is capitalistic accumulation itself that constantly produces, and produces in the direct ratio of its own energy and extent, a relatively redundant population of labourers, i.e. a population of greater extent than suffices for the average needs of the self-expansion of capital, and therefore a surplus population" [Marx: Capital].

Further to being an intrinsic feature of a capitalist economy unemployment is actually useful to capitalists. It creates the 'reserve army of labour' which is so beneficial to capitalists because it helps to lower wages and reduces militancy amongst workers, helping to keep them in line. No wonder capitalist governments like New Labour have very little intention of doing anything about unemployment.

Any economic system which cannot provide full employment is a failure. It needs to be replaced by an economic system that can provide full employment. Even in a capitalist society where the free market is failing governments must step in to do what the market cannot and create jobs for those without work. That is the hallmark of a civilised society. Its a pity that doesn't apply in the UK.

A Radical Programme for the Left

There has been a lot of talk about where the left goes next. In spite of the credit crunch left wing and progressive groups appear to have no coherent alternative programme to free market capitalism.

I've posted about these issues before and suggested some alternatives but here I want to explore what an alternative programme might look like. Firstly its essential to understand that the core of any alternative programme must be an economic strategy. It is essential because the economy is at the heart of our society. The economy embedded as Polanyi observed. This is historically where the left have failed to deliver. The focus thus far has been on nationalisation and delivery by the state. Thanks to the collapse of the Soviet Union this approach has lost much of its credibility. And its not just in the Soviet Union that state control of the economy has run into trouble. In the UK the Labour Party used to believe in a 'mixed economy' (in the 1960s and 70s) with utilities and public services owned and run by the state with the rest in the private sector. That also failed for reasons which are too complex to debate fully here but a large part was played by the fact that the Labour government's commitment to state control was weak and lacking in any kind of dynamism or innovation. However, when we talk of these failures we must never lose sight of the effective propaganda and financial war waged by the free-market right to undermine alternatives to capitalism.

Its important to understand why the alternative economy is crucial. As long as we rely on the 'free' market - i.e. capitalism - to deliver our economic needs we will continue to have great inequalities and mass poverty globally. That can never change because that is how capitalism works. It was Marx who first explained this process. By acquiring the surplus value of worker's labour capitalists are able to cream off the wealth from society for themselves - leaving the rest of us with the crumbs from the cake. This can't change unless we create wealth for ourselves instead of wealth for capitalists. They need us but we don't need them. You can't have capitalism and social and economic justice - they don't go together. Its essential to at least understand this basic bit of Marxism. You don't have to be a Marxist but you need to understand how capitalism works and Marx has the answers.

It is important to also understand that by capitalists I don't mean the person who runs your local corner shop, restaurant, farm, or small business. these people are not capitalists. Capitalists are the people who own the means of production i.e. Olag Deripaksa, Lakshmi Mittal, Rupert Murdoch et al. It is the multinational corporations which are the root of the problem - not your local newsagent.

So how can an alternative economy work? How can we deliver all the goods and services which we need without the 'free' market? The answer is a mixture of nationalisation and mutualism. There are some obvious things which the market cannot deliver - the railways and universal post are examples. So we nationalise the railways and keep Royal Mail in public ownership. We also need to nationalise the banks and utilities. The banks have far too much power as we have seen and essential services such as energy and water need to be available to all - not on the basis of what people can afford to pay. Also included would be healthcare, education, social services and welfare.

By nationalisation I do not necessarily mean straightforward ownership and control by the state. These nationalised industries could be not for profit companies or social enterprises where the employees are the stakeholders. We need to look for more dynamic models in order to make sure that the nationalised services do not stagnate. They must be able to pay their way, and to develop and innovate. The workers in them must be moivated to make them successful. In any case there must be no shareholders - unless that is, all UK adults are made 'shareholders' with 'shares' that cannot be sold or otherwise traded. There is no reason why public services such as health, for example, could not be delivered by mutual organisations supported by the state. We need to come up with new models because we do not want to repeat the mistakes of the past.

What about goods? there is no reason why goods can't be delivered by co-operatives as I've ready proposed in 'How to Beat Capitalism'. There are plenty of successful examples. What we need is a government which is committed to actively promoting and supporting mutualism as a viable alternative to capitalism. There used to be a national Co-operative Development Agency and this needs to be revived - so does co-operative development at a local level. The Mondragon Co-operatives provide a good example of how co-operatives can successfully deliver a range of goods. In the short to medium term we also need the kind of Green New Deal which is being supported by the Green Party to provide thousands of jobs and investment to help to combat climate change.

If an alternative economy is the first priority, the second priority must be democratic reform. We need a written constitution - with a removal of all royal perogatives from the government, an elected second chamber to provide checks and balances, electoral reform with proportional representation and the revival of local government. Local councils must be able to deliver services in-house, be able to provide social housing and have democratic control of local services including health and education. People, local and democratically, must be able to determine whether they want a new store in the heart of their town - not the corporations.

A programme for the left needs to begin urgent steps to move to a low carbon economy. I've already mentioned the Green New Deal But we need to much more particularly in the area of public transport. Climate change is the biggest threat to our society.

There are many other issues but these are the key ones. The left will have to work hard to persuade voters that these changes are necessary given the evident pro-market bias in the media, and left groups will have to learn to work together instead of the eternal infighting which has cursed socialist politics for the past century or so. A left government will have many obstacles to contend with. Capitalists are likely to stage an investment strike, starving the UK of capital and creating unemployment. European legislation, which enshrines neoliberal values, will have to be reformed. But all this can be done. Franklin D Roosevelt did much of this in the USA - the world heartland of capitalism - and we can do it here.

And finally a word about trade unions. There is a crying need to free up trade unions from the repressive Thatcherite legislation designed to hobble them, This must also be part of a radical left wing programme. But trade unions need to change also. In the UK they have always had very limited horizons - recruit, negotiate, collective bargaining... and er .. that's it. Trade unions did set up the Labour Party but now it has turned against them they must grab the opportunity for change by refusing to support New Labour financially and if necessary setting up a new party of the left. Their role in bringing about an alternative economy will be crucial.

None of this can be done overnight - its a long hard road. But it must and can be done. Capitalists changed the rules to suit their purposes. We must democratically change the rules to suit ours.

Parliamentary reform? - don't hold your breath

I haven't said much in this blog about the MP's expenses scandal. Why not? Firstly I've been busy with the Euro elections and then away for two weeks, secondly there has been wall to wall coverage everywhere and finally it has proved to be a great distraction from what really matters at the moment - the economic crisis. In fact my last post on the issue was in January well before the Daily Telegraph spilt the beans.

But all this talk of Parliamentary reform brought on by the expenses scandal is old news to many of us. If you read the Guardian you would think that the nation had only just noticed that we had a rotten parliamentary system. Not long ago the likes of Polly Toynbee and Jonathon Freeland were writing as if all was well with the world - all it needed was a few tweaks from Gordon and everything would be hunky dory. But some of us have known that Parliament and the electoral system drastically needed reform - well, for most of our lives. And some of us have known that Gordon would continue exactly where Blair left off er.. ever since he became Prime Minister - as I made clear in April 2008.

For example, there has been talk of introducing electoral reform for decades. When I was a teenager in the early 1970s I couldn't understand why we had an unelected House of Lords. Our system has clearly been rotten and bankrupt for a very long time, and, despite the overwhelming case for change, nothing has happened.

Nor is very much likely to happen because we live in an elected dictatorship. All power is in the hands of the government (increasingly the Prime Minister) with no checks or balances. We have no written constitution, and in the past 400 years or so politicians have gradually taken over powers which used to belong to the monarch. Combine that with a first past the post system which virtually guarantees a monopoly of power for the two main parties and what politician would want to change it? An honest one perhaps? One who believed in social justice? Now when was the last time we had one of those in Number 10?

Why we should support the Lindsey strikers

After the sacking of 647 workers at the Lindsey oil refinery the industrial action continues. Many workers showed their defiance by burning their dismissal notices. It is estimated that another 4000 workers have gone out on strike around the country in support, including workers at Sellafield. There is absolutely no way that Total and its contractors could have got away with treating workers like this in France, or Germany. This is good old fashioned union busting.

The fact that the strike is 'illegal' means nothing. These workers voted with their feet - they walked out. Who needs a ballot to do that? The Thatcherite labour laws were brought in to hobble trade unions and weaken workers power. That is class war - pure and simple. Of course there will be people who will say you must have a ballot and I agree that there should be a ballot - if workers want one. The whole purpose of the ballot in Thatcherite trade union legislation is not to make things fairer but to tie up the union in bureaucracy and expense and prevent them from taking spontaneous action like that at Lindsey.

In the Lindsey case it remains to be seen if wildcat action was the right tactic. Much will depend upon support from other sectors, and there is still the possibility of a national strike ballot. All workers should support the Lindsey strikers. The Visteon workers showed that it is still possible to win disputes even in the most difficult of circumstances. We will need workers to show more strength and solidarity in the months to come because they are are going to be made to pay for the bailout of the fat cat bankers with their wages, conditions and jobs.

Update: Well. It looks like wildcat strike action proved to be the right tactic for the Lindsey workers. They have secured jobs for the original 51 workers who were laid off and the 647 who were sacked.

Unison Conference - Brighton 2009

Off once again to the Unison Conference in Brighton. Great venue, the town that is, but there is talk of not going there again - pity. The conference was much the same as last time I went two years ago but some things have changed. The most important difference was that the penny has now dropped with just about all the delegates - New Labour is a boss's party and has completely betrayed its working class supporters - so that is a step forward.

There was a rousing speech by Dave Prentis in which he threatened to withhold funds from Labour. Many have taken this with a pinch of salt but I wonder. Prentis mentioned twice that we have reached a "crossroads" and mocked senior Labour politicians. If the Labour Party can only deliver 16% of the vote why should trade unions support it any longer? I think we are just begining to see the start of a fundamental shift in politics.

As for the rest of the week it was farly dull. As usual the most passionate debate was about Palestine. This time the 'friends of Israel' used a low key devious approach which went - "We support a two state solution but a boycott will hurt the Palestinians" - Yeah of course it will - then why are they asking for it? The usual disingenuous guff we hear from pro-Israelis. Needless to say they rightly lost again and the boycott continues.

I just had to finish by mentioning the Socialist Worker/Socialist Party crew who bombarded the deleagtes with literature, as usual, every time they entered and left the hall. How many years have they been stood outside doing this and where has it got them? - even though there is a crisis in capitalism. When are they going to wake up and realise that dogmatic socialism just doesn't wash with the British people. Social justice yes - Marxism (sadly) no. Why do you think I joined the Green Party?

The Euro debacle - 9th June 2009

Well, it couldn't have been much worse for the Green Party could it? We increased our vote by more than 25% nationally and scored as high as 12% in the South East. We came agonisingly close to getting several more MEPs and the main beneficiaries of the night were the BNP and UKIP, two parties who deserve the votes of nobody at all.

Much has been made of the BNP getting elected but their vote went down. The BNP got in because the Labour vote collapsed. In the NW it was particularly painful because our candidate Pater Cranie missed out to the BNP by 5,000 votes. We deserved a lot better.

The question that has to be asked is why on earth do people vote for a bunch of Tory rejects like UKIP? Their leader Nigel Farage (who?) was heard boasting before the election of the millions he has made from Euro allowances, and then there is the UKIP MEP Ashley Mote who was convicted of fraud ....oh and er there is the other UKIP MEP Tom Wise who has been accused of false accounting and money laundering! Why would anyone want to vote for this shower? Well unfortunately they do.

All this shows a more desperate need than ever for a party of the left that can re-assert the values of social justice. I believe the Green Party is just that party but I'm realistic enough to appreciate that there are many in the labour movement who will never support or join the Greens. They just don't get it on the environment and are still stuck in a post-war time warp as far as their political thinking goes.

Great Gable 6th June 2009

I had been planning to walk up Great Gable in my shorts and T-shirt on 6th of June in support of Water Aid. Seven of us from work made the climb but it turned out not at all how I expected. We stayed the night before at Buttermere Youth Hostel and that was quite an experience after 30 years - but more of that later. The early morning was overcast and showery, so at Seathwaite we donned our waterproofs and girded up our loins for the ascent via Green Gable. This is a popular route and the first part of the climb, by Sourmilk Gill, is pretty steep. By the time we reached the top most of us were feeling the strain. The next part of the walk is a relatively easy stroll up the Gillercomb and then onto the shoulder of Green Gable. Though it rained through most of the walk it wasn't until we reached the shoulder that the full force of the weather hit us. It was very cold, with a strong wind, and we could see snow on top of the Helvellyn range!

Although we wanted some lunch there was no shelter so after a drink and a snack we pressed on to the summit of Green Gable. These weren't the conditions to hang around in so after a few photos we went down to Windy Gap - which certainly lived up to its name. From the Gap there were great views of Ennerdale but we had no time to waste - weather conditions were worsening so we carried on straight up Great Gable. The climb was much steeper than I remembered it. I was beginning to get tired and cold - luckily I had brought two fleeces and after the second one went on I felt much better. After that it was a struggle to the summit fuelled by a half frozen Mars Bar.



It was a relief to be on top but just as I approached the summit the mist descended and we were in cloud. There were patches of snow on the summit and it began to sleet. This was no place to hang around with tired and hungry bodies so after a few photos we headed straight for the descent to Sty Head. And what a descent it was! Fifteen hundred feet of unrelenting steepness on wet and slippery rocks. My knees were like jelly by the time we reached Sty Head. But there was no time to relax even here - there was a bitter wind and driving rain so we headed straight down to Seathwate and a welcome cup of tea. In the end we raised just over £2500 for Water Aid so thanks to all that helped and contributed.

I just ought to add something about 21st Century Youth Hosteling. Buttermere Youth Hostel is a very pleasant place which is obviously popular with families. Much has changed since I used to go in the 1960s and 70s. You can get alcohol and decent coffee and the food has much improved. However there are still some odd anomalies; Buttermere shuts, yes shuts, at 11pm, get back any later and you are locked out!; the bunk beds are still the same ones I slept on 40 years ago and just as uncomfortable; there is an eerie quietness in the common room - as if you are in church - people speak in hushed tones. Later in the week I moved to Elterwater (stays open until 11.30pm!) with a friend and did some self catering. The kitchen was nice and clean but the pots and pans were still post-war vintage. Not a non-stick in sight! Would I go Youth Hostelling again? Possibly, but despite the modernisation it its still all a bit hair shirt'. I know the YHA is strapped for cash but please get some new bunks!

Think Again - Vote Green



Stop the BNP!

In the forthcoming Euro Election on 4 June Peter Cranie is the Green Party's candidate. He is in a straight fight for 4th place with Nick Griffin leader of the British National Party (BNP). The BNP represents the politics of hate and it would be a disaster if Griffin got elected

Here Peter Cranie talks about his campaign:



USE YOUR VOTE IN THE EUROPEAN ELECTION - VOTE GREEN TO STOP THE BNP

Public good, private bad

People who have followed the posts on this blog will know that I have been explaining how privatisation benefits the rich at the expense of the poor but it is probably worth pulling it all together in one post so here goes.

Privatisation of public services has been a key part of the neoliberal Thatcherite project of the past 30 years. It makes the rich richer and the poor poorer. The neoliberal project is all about dumping costs onto the poor whilst creaming off more of society's wealth for the rich.

So how does it work? Quite simple really but it has to be bolstered by one big crucial lie. The lie is that the private sector is always, but always, more efficient than the public sector alternative. No evidence is ever produced for this but it has been repeated so often over the last few decades that most people accept it as a fact. There is evidence though to show that the private sector is not more efficient than the public sector and that comes from the International Monetary Fund! (IMF) - see this paper.

But we do need to consider what is meant by 'efficiency'. Normally it is taken to mean that the private sector can deliver public services at a lower cost - as if that was all that mattered anyway. The fact that they can deliver services at a lower cost is very questionable and not just by the IMF. Consider what happens when a public service is privatised; a private company moves in and takes over the service and the workforce that delivers it. The company needs to make a profit so the first thing it does is to cut the workforce and lower their terms and conditions (reduce holidays and pensions). The cost of resulting unemployment is pushed onto the taxpayer and the cost of the profits is pushed onto the remaining workforce. In fact the employer is literally taking money out of the pockets of the employees and giving it to shareholders - hence a direct transfer of money from the poor to the rich. This is not lower cost delivery it is dumping the costs onto workers and the wider society. Its not efficiency its legalised robbery.

But its much worse than this. Because you don't have competing public services (e.g you only have one waste collector in your council area) what you end up with is a private monopoly. Once the public sector alternative has been lost what happens if the company providing the service goes bust? Well it has to be bailed out. Why? Because even if you wanted to you couldn't just bring in another company to take over at short notice (bins have to be emptied). We are also sold a lot of guff about competitive tendering as if hundreds of companies were competing for every contract. This simply isn't the case and contracts are usually awarded to one of a few of the usual suspects.

What we end up with is a very cosy private monopoly and and easy money for the people who own the company. In time, costs can be hiked up to increase profits and all this is at the taxpayers expense. No private company could compete with an efficient public sector alternative . Why? Because the public sector alternative does not have to make a profit therefore it will always offer better value for money. In addition the public sector can always borrow money for investment at a lower rate of interest then the private sector which again saves the taxpayer money. The reality is that the most cost effective way to deliver public services is the public sector option.

Of course, it is an essential part of the privatisation project that the public sector is excluded from competing with the public sector in because it is unacceptable to the privatisers for the public sector to be seen to provide better value for money. That is why everything has to be privatised. And that is why the public sector is being privatised by stealth. Slowly but surely. One the Tories get into power they will have the confidence to accelerate this process because they will claim that they are eliminating 'public sector waste' and delivering better value in a time of budgetary restraint.

Privatisation of public services is basically a racket. Its hard for people to understand that their government would want to institute a system which costs them more, reduces employment and only benefits the rich but that is the kind of government we have. That is what New Labour stands for. In the long run we will all have to pay more for less and those who benefit will be the better off.