We are the economy

One of the things that I find utterly baffling and amusing, in a very darkly comic way, is the BBC's analysis of 'our' economy. I listen to Radio 4 because it is supposed to be a serious news station, with journalists who allegedly offer us a realistic analysis of the world we live in. I mean people like; Robert Peston, Stephanie Flanders and Nick Robinson. The problem I have with these people is that their analysis is fairly useless if you really want to understand the world we live in.

What we get offered is an 'orthodox' economic analysis. Just think -  "Middle Ages" and "Catholic Church" . Because that is really what it is like. If you think further you might even get to "Spanish Inquisition". Keep listening  to this stuff and you hear things like - blah IMF, blah blah, default, blah Euro, blah blah Mervyn King, blah blah the markets, etc etc - remember Bart Simpson and his teacher Ms Krabappel? That is what happens to me when I listen to this stuff. Is it because I am thick - or is it because I am hearing total bollox?

I'd like to argue it is the latter, and I'd like to argue that the BBC is little more than a propaganda station for the UK government, and the market. In fact, I'd like to argue that I know more about economics than Stephanie Flanders and  Robert Peston. Is that because I am a bighead? No, its because I am a worker. Remember them? Well, you probably are one if you are reading this.

All you need to know about economics is that all the wealth in the world is created by working people. By wealth I don't mean suitcases full of cash. What I mean is houses, cars, and iPods. I also mean services like teaching, passports, probation, and emptying the bins. This is stuff that we do. Without us, none of these things would happen. We are the world economy. Fuck the markets, they are irrelevant. We don't need them, but they need us, because they prey upon our labour like parasites. They contribute nothing that is socially or economically useful.

Tomorrow, public sector workers will go on strike. Without them there is no economy. Without teachers, our children won't be taught, without civil servants, you won't get a passport.  Whether private or public sector workers - without workers, as Marx explained, we have nothing, no wealth and no prosperity. We don't need bankers, or hedge fund mangers. We don't need the free market. These people and their gambling casino are irrelevant. This is our economy and its about time we took control of it. Support the public sectors workers pensions strike tomorrow, and make that the beginning of a peaceful revolution to bring us to a position where our economy really does belong to us.

Britain's new ruling class

I grew up in Britain in the 1960s. A that time, people used to talk about the ruling class. Nobody thought there was anything odd about that - such talk was common currency, on the bus, in the pub and in the workplace. This was because people wanted change, they wanted the ruling clique bust wide open. I have already referred to this in more detail in a recent post - about how things improved, and how people thought that power had become more accessible to all, largely through the opening up of our higher education system. How things have changed! Now you never hear anyone talk about the ruling class. There is a kind of tacit assumption that we all have equal access to the corridors of power - but I beg to differ. I think that the ruling class  is back, and with a vengeance.

There is no doubt that over the past 20 years or so we have seen the development of a political class of career politicians. Peter Oborne, the right wing polemicist wrote about this in his book, The Triumph of the Political Class, in 2007. In a nutshell, his argument was that a new self-serving political class had grown up, and become dominant in the UK. I have to say that, on the whole, I agree with him. Prior to the emergence of this class, politicians had often lived and worked in the real world before entering parliament. They had to work their way up the ladder. There were working class MPs. But this has changed. Many of the most important and influential of our politicians have jumped straight from higher education into parliament. Worst still, many are the appointees of our leaders, people who were chums of Tony Blair or are pals of Dave and George. These people are parachuted into safe seats knowing that they will be elected, and they owe their allegiance to the people who 'appointed' them.

This process means that more and more of the people who sit in parliament are hand-picked by a small ruling clique. No one else can get a look in. Its as if the House of Commons is set up like the House of Lords. Sure, you can vote for people, but only people chosen by Dave, or Nick, or Ed. Put like that, its a chilling thought, and what does it say about our democracy? I'm not suggesting this is the whole story because I don't believe that these politicians rule on their own. The new ruling class is an alliance of these leading politicians and big business leaders (capitalists, increasingly from the financial sector). What matters is that we are talking about a cabal of people who have things sewn up, and act in their interests - not the interests of the people in the UK. The resulting irony is that Britain is becoming more like Egypt, with a rotten self-perpetuating elite and a fraudulent democracy, just as Egypt struggles to become, more like how Britain is supposed to be.

What suits this ruling group is a narrow neo-liberal right wing ideology dressed up as economic necessity i.e. the usual suspects - privatisation, de-regulation, ending welfare and pensions etc. - which amounts to a massive transfer of wealth from ordinary people to the elite - the rich and the big corporations. No wonder we are being told to tighten our belts, we are facing the biggest heist in history. 

Its not just the fact that our democracy has been subverted by this new ruling alliance that we should be concerned about. Its the fact that some of these 'chums' are unfit to be in positions of power, and never would have been, if they'd had to go through a normal selection process. One topical example that springs to mind is Michael Gove, Minister for Education, and chum of David Cameron, who was parachuted into parliament because Dave thought he was a good egg. But Gove is a deluded right-wing crank who draws his inspiration from Tom Brown's Schooldays. His latest potty idea, that parents should break the teachers strike on June 30th by taking over schools, shows exactly what sort of extremist he now is. Take a look at this priceless photo, which shows just what sort of 'extremist' he used to be.

We can end this  situation, but only by re-asserting control over our political parties and our democracy. By using our votes wisely and judiciously at election time and fighting for change. Its going to be a long hard struggle, and we need to get started now!

J30: STRIKE!

Support the strike action by public sector workers on June 30th! You can visit this website to find out more about the actions planned next Thursday - http://www.j30strike.org

Everyone who is not capitalist class, unlike Cameron and Osborne, should support the public sector worker's strike action on Thursday June 30th. This isn't just an attack on pensions its part of a wider attack on the living standards of all of us - except the very wealthiest in our society. That means an attack on you!

You should support this strike action in any way you can because:

1. Decent public and private sector pensions are NOT unaffordable - see here.
For far too long the right have got away with using the demographic argument. The reality is that final salary pensions can be funded if there is the political will there to do it. 3.5 million public sector workers are in the Local Government Pension Scheme, which is well funded. A sustainable settlement for this scheme was agreed by the previous government in 2006.

2. The savage £81 billion worth of cuts are not designed to help our economy. They are ideologically driven, with the intention of destroying the welfare state and privatising public services, to the detriment of all except the very richest in our society. Under cover of the shock of the financial crisis, which they caused, capitalists are attempting to undo a century of progress for ordinary people.

3. Public and private sector workers must reject the attempts by this class war neo-liberal government and its supporters to divide them.There has been a concerted and effective campaign by the political right and its cheerleaders in the media to implement austerity by dividing public and private sector workers. If you are a private sector worker you should be supporting decent pensions for all - not expecting public sector workers to have their pensions destroyed as well.

4. This is a weak government with a weak argument for cutting pension benefits. Cameron and co. really do fear that the strikes could get up a momentum and majority public support. If this happens they are deep trouble.

I hope to see you at one of the protests next week. Not sure where I'll be yet but I'll probably be in Chester, solidarity!

The Greeks MUST default on 'their' debt

I came across this post by Mark Hudson yesterday on a blog called Naked Capitalism. It's an excellent description of how the failures of financial capitalism, which culminated in the collapse of Lehman Brothers in 2008 and threatened to bring down the world economy, are being used by the capitalist class to roll back all the democratic gains made in the past century by ordinary people. This is, as Naomi Klein has described, an economic shock doctrine - use a crisis to impose cuts in living standards on the mass of the people which they would ordinarily never accept.

Its worth a brief recap of how we got here. Financial deregulation since the 1970's, combined with an aggressive free market doctrine known as neo-liberalism, which originated in the Chicago School, have lead to banks and financial institutions such as hedge funds becoming out of democratic control in Western countries. At the same time the standard of living of all except the wealthiest has come under attack. The lack of controls on financial capitalism has lead to a series of economic crashes since the 1980s, each one worst than the last. These include; the Asian crisis, the dotcom boom, and the latest and greatest crisis since the crash of the Great Depression, which began in the USA with the collapse of subprime mortgages in 2006.

The latest crisis resulted in the virtual collapse of banks worldwide which was only halted by state intervention. What began as a crisis for the financial sector lead directly to the current sovereign debt crisis which we are now in. This sovereign debt crisis, in which taxpayers are being asked, once again, to bail out the financial system is being used as a weapon to impose neoliberalism on people in Europe and the USA. This means an attack on welfare, pensions, wages, workers rights, and environmental regulation, and privatisation of public services and state assets. This is driven not by economics but ideology. The aim is not to find a solution to the crisis but to use the shock of the crisis to destroy the standard of living of the mass of the population in the West. Those who gain from this will be the capitalist class.

Nowhere is this revealed more starkly at the moment than in Greece. The bailout of Greece, imposed last year to the tune of €110 billion, failed. The important point is that this bailout was only ever in tended to protect French and German banks, and other bondholders, and not the Greek people. Also of great importance was the desire to protect the great European single-state project know as the Euro. Of course the Greeks should never have been in the Euro. Without their own currency and the ability to set interest rates they were always going to struggle economically. Of course it can be argued that successive Greek governments mismanaged the economy and that the Greeks were living beyond their means but that misses the essential point. This is really about a coup d'etat, about financial technocrats and finance capitalists taking control. It is a struggle between democracy and capitalism.

The only way forward for the Greeks (and the Irish for that matter) is to default on their debts and leave the Euro. The alternative is the end of Greek democracy and the wholesale privatisation of the country at knock down prices. Greece will become a sovereign state and democracy in name only. As Mark Hudson said in his post; this is the road to financial serfdom;

"This new road to neoserfdom is an asset grab. But to achieve it, the financial sector needs a political grab to replace democracy with financial technocrats. Their job is to pretend that there is no revolution at all, merely an increase in “efficiency,” “creating wealth” by debt-leveraging the economy to the point where the entire surplus is paid out as interest to the financial managers who are emerging as Western civilization’s new central planners".

Back to the future?

One of the golden rules about writing a political blogs like this is that if you want to be taken seriously you should write well argued posts which are fully referenced. Whatever you do, you should avoid having a rant! Now I know I've come very close to breaking this rule on a number of occasions but here is where I blow it wide open:

Did you watch the Royal Wedding? - have you noticed the praise given to Prince Phillip recently on his 90th birthday? These events were marked in the UK media by the kind of sickening sycophancy you would have thought died out many years ago. The Prince is a reactionary dinosaur of the highest degree. Despite the fact that he has managed to avoid making many public gaffes over the years he is still well known for the 'slitty eyed' gaffe he made about the Chinese years ago. What is so worrying about the recent Royal mania is that it seems to replicate the kind of deference that used to exist about sixty years ago - we appear to be heading backwards at an alarming rate.

On the Duke's birthday, Johan Hari said in the Independent:

"Today, you are being encouraged to celebrate a man who merrily visited a genocidal dictator and used the occasion to sneer at British democracy. A man whose political interventions even prompted complaints from the far-right Enoch Powell. A man who, at the height of mass unemployment, mocked the unemployed, while complaining his own family of multi-millionaires was financially deprived. A man who has shot countless examples of endangered species – and then sought praise for his protection of wildlife."

How right he was! But what really disturbs me is this; I grew up in the 1960s; at that time people were sick and tired of the UK being run by a moribund establishment, based on connections and privilege, closed to ordinary people, known as 'the old boys network' and populated by people like Prince Phillip. Thanks to scandals like the 'Profumo Affair', this ruling establishment was regularly mocked on TV by comedians like Peter Cooke, and in programmes like 'That Was the Week That Was'. People wanted change, and they got it through an opening up of opportunities, not perfect, but much better than anything that had gone before. Thousands of young people, many of them working class, were able to go to university for the first time, thanks to free higher education. Social mobility improved dramatically and inequality in the UK fell for the first time ever. Ordinary people were able to achieve things they could never have dreamed of under the old system.

Now this is all being reversed. David Cameron, far from being the 'boy next door' is a millionaire son of the ruling class. He is presiding over a reactionary government which is dragging us backwards to an age of connections, privilege and noblesse oblige - handouts from the rich. Anyone who thinks that increasing tuition fees to £9,000 a year and privatising higher education is a good thing is an idiot. Yet this, in the face of deficit cuts, is being presented as a kind of 'progress', and some people are stupid enough to think it is a good idea. The deficit, created by the bankers and capitalist class, is being used by this government as an excuse to drag us back at least half a century, undoing all the gains that have happened for ordinary people during that time.

Of course it's not just those who might have been able to go to university, as I did, who are being affected. Its everyone who is unemployed, disabled or low paid. Thanks to this government and the two previous ones, we have a chronic housing shortage. Low paid people who would have benefited from the council house building programmes of the 1950s and 1960s, and given some security in their lives, are being forced out of their homes by 'social cleansing', leaving ghettos for the rich. The unemployed, the victims of free market failures, are being vilified and treated like criminals. In addition, the incomes of all but the richest are being reduced to pay for the bankers deficit.

Where will this end, and how far does it have to go, before people will eventually wake up, smell the rotten stink of class war and privilege, and realise what is happening is unacceptable in a civilised society? How about bringing back feudalism, or slavery? Why not make the unemployed work for nothing, chained in the slave galleys of the big corporations? How long will it be before children are shoved up chimneys, so that we can 'compete' better with the impoverished and exploited of the Third World?

Perhaps what we need is a new Charles Dickens - someone who can reflect back to us the harsh realities of 21st century-19th century capitalism, or would that person be drowned out in the modern age, by the wall to wall bread and circuses of the new celebrity age?

The Economic Hitmen

This is an excellent video, well worth watching. At just over two minutes long, it sums up how Western capitalism exploits the rest of the world, and it's coming to a country near you very soon. I hope John Perkins, the author of Confessions of an Economic Hitman doesn't mind me posting a link to this video, especially since I don't agree with his view that this is an aberrant, mutant form of capitalism. If anything I think that the more sharing capitalism we had after the second world war - the 'Golden Age' - was the mutant form of capitalism. That real mutant form existed after the war because of the Cold War, a time in which western workers had to be kept onside because of the supposed threat of the Soviet Union. Now that 'threat' has gone we are seeing capitalism as it truly is. Of course it's not just about the Soviet Union but the boom and bust cycles, and the fact that we are in a crisis because profit is falling.

There are also two other important factors which, in the past, helped to mitigate the worst excesses of capitalism. The kind of capitalism we see now is 19th century capitalism, the worst excesses of which were disguised, at that time, by colonialism. Progress for ordinary people happened then because the more advanced western capitalist nations protected their economies from overseas competition. In addition, ordinary working people, who made up the bulk of the population made democratic gains - pensions, healthcare etc - through political parties like the Labour Party in the UK and the Democratic Party in the USA. Those factors no longer exist, protectionism has gone and so have the parties of the working class. That is why workers in the West are now being screwed, rather than just those in the Third World.

Costing the Earth?

Buttermere in the English Lake District

Interesting news last week - to the sound of a fanfare the Coalition government proudly announced a ground-breaking piece of work with the publishing of the National Ecosystem Assessment (NEA). According to the BBC - "Nature is worth billions to the UK" - no kidding? Or as we say in the UK - 'No shit Sherlock!". Its worth noting that there is nothing new in trying to put a cost on nature. The economist David Pearce did it in his book Blueprint for a Green Economy twenty years ago.

In the NEA, a bunch of economists - could these be the same ones who failed to spot the Great Crash that we've just been through? - set out to measure the monetary value of the UK environment. There were some priceless quotes including this one from Bob Watson, chief scientific adviser to the Department for Environment, Food and Rural Affairs (Defra) and co-chairman of the NEA:

"Humans rely on the way ecosystems services control our climate - pollution, water quality, pollination - and we're finding out that many of these regulating services are degrading,"

Really? Did you need to stick a price tag on a Beech tree to discover that? It seems to me that the people who did the NEA need to get out more - preferably out their cosy offices and into the environment itself. According to the NEA, the benefit to an individual of living near a green space is £300 per year and bees are worth £430 million or so a year to our economy. What's wrong with this is it's arrant nonsense, and potentially dangerous nonsense at that. Imagine that someone wanted to build a brick factory on the park next to your house and was willing to pay you £300 a year for the privilege, would you accept the money? - of course not. You might be £300 pa better off but you would have lost something far more valuable - your peace and sense of well being. As for bees, if we lost them we would all be screwed.

The simple truth, as we all know, is that bees, for example, are irreplaceable and therefore priceless. There is no way they can be costed. And what about the view of Buttermere Lake and Haystacks from Buttermere (see my photo) - how much is that worth? I guess if the NEA can help prevent developers and money grubbers from destroying our natural environment and wildlife it will have been worth the effort, but somehow I doubt that it will.

Neoliberalism is unravelling, and so is everything else

Capitalism isn't working, and, as a result, we are facing multiple social, political, economic and environmental crises. So wedded are our politicians to the market, and there is so much power in the hands of financial capitalism, that the politicians are trapped like rabbits in the headlights of an oncoming juggernaut. In the UK this is exemplified by the adherence of Osborne and Cameron to a failed economic approach which threatens to take us back into recession. Despite the warnings of what happened to Ireland and Greece, and economists like Joseph Stiglitz and others, despite the dire news about climate change, peak oil and food security, and despite the protests in the Arab world and Europe, we continue, lemming like, to be lead towards the abyss.

It was Santayana who said that those who don't learn from history are doomed to repeat past mistakes. As we repeat the mistakes of the past we are also repeating the failures of the past. It appears we have learnt nothing from the depression of the 1930s. But the saddest thing in the UK is that we also seem to have learnt nothing politically. In the UK the Labour party has learnt nothing from losing millions of votes at the 2005 general election and continues ploughing ahead with self-defeating neo-New Labourism, ignoring the fact that Labour supporters want a return to social democracy. Ed Milliband's timidity, under the circumstances, is astonishing. Here we have a government which has cocked-up the economy, devastated the welfare state and is threatening the future of the NHS and what do we hear from Labour? - a big fat nothing! No wonder the latest poll showed Labour neck-and-neck with the Coalition for the first time since the election in the latest polls.

We won't be able to solve any of the above mentioned crises until we end the domination of the political right and financial capitalism. This can only be done by a move to the left, a return, initially at least, to the politics of social democracy and social justice - that is what people are crying out for here, in Europe and the Middle East. As a socialist and environmentalist, I've been aware for decades that rampant capitalism with its endless desire for growth would lead to the collapse of environmental systems with devastating consequences for all of us. I just didn't expect it to happen in my lifetime.

So what is the answer? How can we change politics and revive the politics of the left? Not by suddenly ramming Marxism down peoples throats that's for sure. We need to learn from history and make sure we don't repeat the mistakes the left made in the past, ditching the dogmatic and sectarian aspects of Socialism which have lead to disillusionment and defeat. I've posted about this before here. The answer is the stick to the straightforward democratic socialism of social justice and need not greed, of putting people in control of their own economy, of jobs, housing, healthcare and a strong public sector. That is what the people in Syria, Yemen, Egypt, Libya really want.