Omicron and covid chaos - no end in sight

In many ways, Covid is the perfect storm. An infectious virus that is more deadly than the flu. Easily transmissible, it can kill and cause long-term health effects. Thankfully we have vaccines, but the vaccines don't provide full protection and don't prevent transmission either. In early 2020 Covid spread around the world. With one or two notable exceptions, governments reacted too slowly to the threat. At least 5 million people have died worldwide and the death toll in the USA alone recently passed 800,000. 

The fundamental problem is that capitalism can't cope with coronavirus. It's that simple. In an economy driven by profit and growth where little heed is paid to poverty, poor housing, and people's healthcare needs, where the economy comes first, it was always inevitable that countries would struggle to contain the virus successfully. Couple this with the fact that much of the world hasn't been vaccinated and the obscene fact that vaccine patents haven't been waivered while companies make massive profits and you have the failure of capitalism in a nutshell.

In the UK, the government predictably and foolishly celebrated 'freedom' day in July 2021 and here we are in another winter wave which threatens to overwhelm the NHS and damage businesses. Plan B, announced recently by Boris Johnson was too little, too late. With the omicron variant surging the government needs to take action, insisting rather than recommending that people work from home, revisiting the furlough scheme, and dealing with wholly inadequate statutory sick pay as a minimum. They also need to take much stonger action on schools where our children and teachers have been abandoned. 

There seems little chance of this happening. Rishi Sunak has already been moaning about the cost of the booster jabs programme and appears to have gone awol, sunning himself in California. When he gets back, don't expect him to do anything useful - expect more cuts and tax rises - exactly what we don't need.

The big issue here is that covid isn't going away any time soon. We will have to live with it for the rest of our lives and hope that it mutates into a less harmful form. But what we need to do is factor into our economy living with covid. This will require government support which is anathema to the Conservatives. It may require a basic income funded by covid QE, something which was used with the furlough scheme.

In the longer term we need a rethink about the way our economy works and who benefits from it. The climate crisis will force this on us anyway although governments and corporations are in denial about it. We need an economy that puts people before profit. One which is cooperative and collective, where people are decently housed, have stable remunerated work and access to healthcare. If we don't begin to move in that direction soon the alternative could be very bleak.

The aim of #Cop26 is not to save the planet but to save capitalism

Welcome to the climate con which is CoP26 in Glasgow. Here, governments, NGOs, and corporates are supposed to be working together to limit global warming to the 1.5º centigrade target set in the Paris climate agreement. Each country will set itself a Nationally Determined Contribution (NDC), and there is talk of a $100,000 billion contribution - small change in global terms - to help countries in the global south deal with the current impacts of climate change. Outside the conference, there is a mass of activity - speeches, singing, marches, and music - carried out by climate activists from all over the world. Before this CoP started we were told that this was humanity's last chance to take real action to avoid the climate crisis becoming a climate catastrophe.

But there is a real problem with this CoP. As with other CoPs delegates from the very corporations who are the biggest carbon polluters are in attendance. Not only this, but they have the largest delegation, bigger than any country! The aim of these delegates is not to protect the planet, they're really there to protect their business interests. They do this by peddling business 'solutions' to the climate crisis such as carbon offseting - pour out CO2 and plant some trees - and carbon capture and storage (CCS), an unproven technology in which CO2 outputs are collected and buried underground. According to Global Witness:

"What we seeing is the putting forward of false solutions that appear to be climate action but actually preserve the status quo, and prevent us from taking the clear, simple actions to keep fossil fuels in the ground that we know are the real solutions to climate crisis."

As George Monbiot said recently this isn't just greenwashing by corporations it's 'green waterboarding'. Furthermore, Campaign groups argue that the World Health Organization didn't get serious about banning tobacco until all the lobbyists for the industry were banned from WHO meetings. They want the same treatment for oil and gas companies at COP, and they're right.

The only way to prevent catastrophic climate change is to keep fossil fuels in the ground but that is a threat to major business interests, hence the confidence trick of 'net zero' instead of what we need - zero - which allows corporations to continue pouring carbon into our atmosphere. And then there is the issue of subsidies. Its unbelievable but true. The IMF has found that: 

"the production and burning of coal, oil and gas was subsidised by $5.9tn in 2020, with not a single country pricing all its fuels sufficiently to reflect their full supply and environmental costs. Experts said the subsidies were “adding fuel to the fire” of the climate crisis, at a time when rapid reductions in carbon emissions were urgently needed."

The scientists of Carbon Action Tracker (CAT), a globally respected group, are predicting that the result of CoP26 will be a disastrous rise in global heating of 2.4ºC. It's important to be aware that even with a 1.5ºC rise one billion people will be heat stressed, and a temperature of 30ºC for six hours can kill. To find out about MAPA - most affected peoples and areas visit the Fridays For The Future website.

So what does need to be done? We need to shut down all coal mines and halt all new oil and gas extraction, and we need to scrap all subsidies for fossil fuels. This, combined with a carbon tax and a green new deal would be a good start. Then we need to start to focus on degrowth. If you want to know more about what degrowth is and how it works watch this video in which Jason Hickel explains degrowth. I recommend you read Jason Hickel's book - Less is More.

Now an economist proves what we already knew - capitalism doesn't work!

I was really interested to read about Thomas Piketty's new book 'Capital in the Twenty-First Century' which is being hailed as a 'groundbreaking'  work and, apparently, is making a real impact on economists. What Piketty has done is to 'prove' what many of us long thought was true - capitalism creates inequality, and left unchecked, ever increasing inequality. Piketty has done this by sifting through masses of economic data from the past couple of hundred years and he has written about his findings in a book which is accessible to the general reader.

All of this is good news - if it has a real impact on economics - and we can only hope now that it does. One hundred and fifty years or so ago Marx showed how capitalists expropriate wealth from working people through the mechanism of surplus value, and despite the fact that Marx had a huge influence politically, much of his work was ignored by mainstream economists, who were wedded to the capitalist economic system. Lets hope that Piketty doesn't suffer the same fate as Marx because economists whose ideas run counter to the prevailing order tend to have little impact in the end. This is because 'economics' is less an academic discipline and more a political justification of the current structures of economic power. 

David Harvey's new thought provoking book

I look forward to reading Piketty's book when I've finished a book I suspect will prove to be a much more interesting and thought provoking read - this is David Harvey's 'Seventeen Contradictions and the End of Capitalism'.  Harvey is a renowned Marxist who has lectured on Capital for many years. I'm only six contradictions into this book but Harvey has already nailed the iniquities and inefficiencies of capitalism and is well on the way to explaining what we must do to build an economy for the 99%. Its a book that I can thoroughly recommend. I'll get round to reading Piketty as soon as I can but I guess I owe him thanks already for proving what I have been saying on this blog for years - capitalism creates poverty.

What we can all learn from Bob Crow

I was really shocked when I heard that Bob Crow had died this morning. He was only 52 years old and his sudden death will be a real blow to members of the RMT and trade unionists and workers everywhere. In his twelve years as leader of the union he increased its membership by 20,000, no mean feat in difficult times. He also did his best to ensure that his members were properly rewarded for their work and wasn't afraid to use industrial action to achieve better terms and conditions for them. That, of course, is how it should be and that is why he earned so much respect, even from his political enemies.

Bob Crow - a fighter for social justice who will be missed

The oft forgotten reality is that the wealth in our economy is created by workers. The trains and the infrastructure Bob Crow's members used in their daily work were built by workers, and the vital task of transporting millions is daily carried out by workers. What would happen without any of this? Capitalists, who are credited with creating wealth, are really the expropriators of the wealth that workers create. Since when has a shareholder or banker ever done any useful or essential work?

There will be more Bob Crows in the future and some of them will have been directly inspired by his example of shrewd tactics and tireless struggle for social justice. What can we learn from Bob Crow? The value of workers and the necessity of struggle by workers to achieve a better world for all. Every poorly paid worker can learn to join a union and to fight for a better standard of living. When Bob Crow was elected he was invited to Newsnight for an interview. He didn't go because he was celebrating with his mates in the pub. Tonight I will be raising a glass to the memory of Bob Crow and all the good things he achieved. RIP Bob.

Capitalism depends upon coercion and violence

The media commonly portrays the 'enemies' of capitalism as violent and destructive. This applies to those who protest, even non-violently against the excesses and destructive nature of capitalism. One recent example is the Occupy movement in the USA. Although there were some clashes between protesters and the police, the violence was very much driven by the aggression and brutality of the police, and its clear that there was a concerted effort to shut down the Occupy movement nationally in the USA. And there lies the problem. Capitalists, and the tame politicians who support them, enact laws which restrict peaceful protest and labour unions, and use the police as proxies to push through measures which benefit them at the expense of the communities which they are exploiting. This is a very convenient arrangement which allows the capitalists and corporations themselves to remain aloof and 'above the fray', hiding behind the law.

One of the more recent examples of this has been the criminalisation of environmental protesters. Not only have the protesters been attacked and threatened with imprisonment but they have also been targeted by the security services, spied upon, and treated like terrorists. So why are these protestors being targeted? It is because they threaten business interests, and that tells you something very interesting about the police and security services - they are here to defend the property and profits of capitalism - not the people, who they are supposed to be protecting.

The front line in the battle for the environment is now taking place over fracking in the USA, UK and in Canada. In New Brunswick the Mi'kmaq people are trying to defend the rights to their land from companies who want to exploit extreme energy. But it's the reaction of the authorities which has been extreme. When business interests were threatened the government reacted with a display of force including riot police, dogs and armed snipers in camouflage gear. Tear gas, pepper spray, and rubber bullets were used against the protesters. Its hard to believe that kind of level of coercion can be used against a peacefully protesting community, and its not surprising that it provoked real anger amongst those affected, which resulted in six police cars being burned. These events are similar to those that have been taking place in Balcombe in the UK where excessive force, though not tear gas and rubber bullets, has been used against locals and supporters protesting against fracking.
 

RCMP use pepper spray on protestors in New Brunswick

Of course there's nothing new about this kind of violence being used against those who threaten the interests of business. In the USA business have long hired strikebreakers and thugs to force their will on workers and communities. One of the most dramatic examples of this occurred in the Battle of Blair Mountain in 1921 when 10,000 coal miners fought for 5 days with lawmen and 'agents' hired by the bosses. here is a quote from the Wikipedia page:

"The Battle of Blair Mountain was the result of economic exploitation of workers during a period of social transformation in the southern West Virginia coalfields.Beginning in 1870–1880, coal operators had established the company town system.Coal operators paid private detectives as well as public law enforcement agents to ensure that union organizers were kept out of the region. In order to accomplish this objective, agents of the coal operators used intimidation, harassment, espionage and even murder."

In the UK, strikebreakers were used in the 'Tonypandy Riots' in Wales in 1911 and troops shot dead striking miners. 

Capitalism is once again in crisis, and if you think the bad days of Blair Mountain are over think again. Those kind of clashes are still happening, and did recently in South Africa when the police shot dead 34 striking miners in the Marikana dispute. The reality is that the primary function of the police in capitalist economies is to defend the interests of business against the people they are exploiting, and the role of the media is to defend the police when they do it to the extent that this coercion has become 'normalised' and is accepted by most people. 

Capitalism has always depended up coercion and the threat of harm to people and communities which don't comply with the wishes of the capitalist class. Even if that coercion is just the threat to destroy jobs and livelihoods - as happened in Grangemouth in the UK recently. We need to expose this violence for what it is - class violence in the service of property and profits riding roughshod over what communities and people want. We need to fight back by campaigning and building up resistance to these atrocities and make them what they really are - totally unacceptable. 

Update 2017: the recent events at the Standing Rock camps where water protectors are protesting about the construction of the Dakota Access Pipeline (DAPL) is just the latest example of excessive force and brutality against peaceful people defending their environment and land against harmful and unwanted exploitation.

Zombie capitalism

Ever since the crash of 2008, when Lehman Bros. bank went under, politicians in the EU and USA have been battling to restore the status quo, which is often described as 'business as usual'. But it wasn't the collapse of Lehman's which brought the capitalist economy to its knees, it was the accumulation of a huge bubble of toxic debt in the world banking system. Rather than a crash, it has been more of a slow motion collapse, as the house of cards comes down.

The banking bailouts which followed, where governments injected capital into a bust banking system, was supposed to solve the problem, but it hasn't and it never could have done because the debt is still there, it hasn't just disappeared. In the shorter term the debt problem has become a sovereign debt crisis which is threatening to break up the Eurozone. European banks have been propped up by short term loans from the ECB, and this still hasn't solved the problem, but what if it can't, what if there is simply too much debt for the system to pay off?

I have blogged before about how I suspected that there were lots of insolvent banks which were hiding their insolvency with the collusion of governments. For any other kind of business this activity would be illegal, but as we have seen, there is one law for the banks and another for everyone else. Now the Telegraph has revealed the state of hidden debts in the UK banking system. The article, by Liam Halligan, shows that UK banks are sitting on £40 billion of undeclared losses, and that is just what we now know about.

Britain's banking black hole

My guess is that taxpayers patience is exhausted. Are we really going to be expected to bailout a bust system yet again? Not a chance in my view. The reality is that there can be no return to 'business as usual'. Neoliberal capitalism, through privatisation and deregulation, has broken the world economic system. The emperor has no clothes. There isn't going to be a recovery, not in the short to medium term, probably not ever. In a recent post I explained why I thought capitalism had reached the end of the road. In essence falling profits have lead to a class-war attack on the 99%, cannibalisation of the public sector, mass unemployment and an unsustainable property and financial bubble. Now there is nowhere left to go. We urgently need a radical alternative economic strategy which has to involve the state taking responsibility for control of the economy, nationalisation of the banks, a Green New Deal, and a move to a low carbon economy. The alternative could just be a collapse into the kind of barbarism we saw in the 1930s. Oh, and don't forget the fact that we have to deal with climate change, and we saw a graphic illustration of that in the UK this weekend.

Why we can and must build our own economy

UK companies are sitting on a cash pile of about £750 billion, and EU companies have about €2 trillion stashed away. So why on earth is our economy struggling? There is plenty of cash to get the economy moving and create the much-vaunted 2.5 million private-sector jobs that George Osborne has been promising us. Why isn't this private-sector job creation happening? Apparently, it's because firms don't want to invest due to a lack of "confidence" (sic!). The problem is that neoliberal austerity policies are reducing the share of national income for working people and depressing demand in a consumer-capitalist society. This is confirmed by a quote from the following article in the Wall Street Journal which states:

".... that policies aimed at further depressing the share of labor in national income will further undermine economic growth. He [SimonTilford] suggests increasing corporate income won't help spur investment while squeezing households by cutting wages will damp growth." [my italics]

In other words, neoliberalism is self-defeating, as I argued in a recent post. Erm... but isn't our government meant to be doing what the private sector - the market - wants? If the corporations and banks want austerity, why haven't they any confidence? What this situation clearly illustrates is that capitalism always wants to have its cake and to eat it. They want austerity to make us pay for the crisis and to trash the welfare state, but they also want us to be able to buy their products!

If we can't rely on either governments or the private sector to lift the economy and produce the jobs that we so desperately need, what are we going to do? Well, we can forget the banks and the corporations because they are not going to help us. They are part of a failing neoliberal economic system which is essentially exploitative and destructive, a system which is eating the planet, and in the process, destroying the prosperity of most of us, of the 99%. As capitalism gobbles up the planet's resources, cannibalises the public sector, and indulges in an orgy of financial and property speculation in order to try and maintain its falling profitability, millions of people are suffering globally. Not just people in the so-called third world, but people in the once-prosperous west, and nowhere has this become more obvious than Greece, which is the front-line of neoliberal austerity.

But one of the starkest outcomes of this crisis is in the modern home of capitalism itself, the USA. Detroit, the motor city, and once-great powerhouse of American capitalism has been devastated. Paul Craig Roberts has written about this in The Ruins of Detroit :

"Detroit’s population has declined by half. A quarter of the city 35 square miles is desolate with only a few houses still standing on largely abandoned streets. If the local government can get the money from Washington, urban planners are going to shrink the city and establish rural areas or green zones where neighborhoods used to be. President Obama and economists provide platitudes about recovery. But how does an economy recover when its economic leaders have spent more than a decade moving high productivity, high value-added middle class jobs offshore along with the Gross Domestic Product associated with them?"

Capitalism at work: economic devastation in Detroit

But amongst the ruins of Detroit, at the grassroots, economic activity is stirring. This is a grassroots revolution. People are beginning to come together and realise that if they want a better economy they are going to have to do it for themselves, and they are starting to rebuild from the ground upwards through co-operatives like the Evergreen Co-op. What's so inspiring about this re-birth is that it is community-focused and lead not by overseas investors or the 'entrepreneurs' of neoliberal myth, and hungry for a buck, but 'ordinary' citizens, and what it shows us just how extraordinary us ordinary people can be. Here is an extract from the recent Re-imagining Work in the Motor City conference:

"In another discussion, participants acknowledged that relying on political and economic leaders to lead was a fruitless endeavor because they have forgotten the people they are supposed to represent. A “we have to do it ourselves” attitude permeated the conference in a recognition that representative democracy is in serious decline. Besides, they said, societal change usually occurs at the grassroots level—and rigid social class distinctions and hierarchies have no place in the new economy we are envisioning". [my italics]

People in Detroit have realised an essential truth - that capitalism dis-empowers all of us. The system is designed to make us think that we need the super-managers and capitalists, that without them, we just couldn't survive. This system is designed to keep us in our place and to keep them in the luxury that only they can afford. But as a result of this crisis, in which whole communities have been abandoned, this myth has been busted, because more and more people are beginning to understand that 'they' need us, but we really don't need them.

But its not just in Detroit that this phenomenon is happening. All over the USA, people are beginning to turn their backs on capitalism and the banks and find their own solutions by building their own economy. According to Gar Alperovitz in his New York Times article entitled Worker Owners of America Unite:

"Some 30 million Americans, for example, now participate in the ownership of co-op businesses and credit unions. More than 13 million Americans have become worker-owners of more than 11,000 employee-owned companies, six million more than belong to private-sector unions."

The politicians and corporations who control our economy want us to believe that it can be restored, but only on their terms, and they are resorting to ever more desperate means to try and continue as if the great crash of 2008 never happened. In the process, through neoliberal austerity, they are making the poorest pay for the crisis, but they're also beginning to scrape the bottom of the fossil fuels barrel with tar sands extraction and shale gas exploitation, both of which are environmentally destructive. These are acts of desperation, meant to prop up a failed system which has run its course.

The truth is that we cannot rely on capitalism and its tame politicians like Obama and Cameron to help us. Essentially, we are on our own. But that, despite the hardship, gives us an opportunity, an opportunity to build an economy that we own and control ourselves. Such an economy needs to be co-operative and community based, supported by local banks and credit unions, which are subject to democratic control.

Co-operatives create wealth and employment, they are rooted in communities, they do not downsize or outsource jobs overseas. They build strong local economies that are resilient in the face of climate change. Best of all, there are no fat-cat managers or owners to cream off the bulk of the wealth that is created. That does not mean we should ignore political parties, we need to support and help build parties that are supportive of this kind of economic development. And we need to help to propel such parties, through the democratic process, into government. Then we can really get down to the business of rebuilding an economy that is truly our own.

For reference see: America Beyond Capitalism

'Free' market myths no.3: entrepreneurs create wealth

It seems that wherever you go these days you are subjected to neoliberal propaganda. The media is full of 'free' market pundits endlessly repeating the mantras of "red tape" and "privatisation", and no matter how bad things get, as a result of the economic crisis created by neoliberal 'free' market fundamentalists, we are told we need more and more of the same. As I've said before this is because the 'free' market fundamentalism of the neoliberalists is not just a mere ideology - its more a system of belief. The advocates of the market have more in common with the fanaticism of the Taliban than they do those who have historically been on the political and economic right.

Which brings me to the third post in my series about 'free' market mythology - entrepreneurship. In the mythology of the market, entrepreneurs, who start out with small businesses and end up with empires, have been elevated to the role of magicians, they are the Gandalfs and Harry Potters of capitalism, individuals possessed of exceptional powers, and without them, you would think that we would all still be living in caves. If you do an internet search on 'wealth creation' you will find many dozens of evangelical articles which extol the virtues of entrepreneurship, and the vital role of entrepreneurs as wealth creators.

The fact is that the magical powers of the entrepreneur have been greatly exaggerated because they are not responsible for wealth creation. But if not them, who is? Step forward the humble worker. All the wealth that has been created in the history of the world has been created by working people, and workers were creating wealth well before entrepreneurs were ever thought of. It is a fact that this iPad I am now using was made by workers not entrepreneurs. The iPad itself was made by Chinese workers in China and was designed by workers at Apple in the USA. No entrepreneurs were involved. The same is true not only of every other product you buy, but the house you live in and the food you put on your table each day. The problem with this reality is that it doesn't fit with the market belief system.

But is not just ecosocialists like me who think that very little if any real wealth is created by entrepreneurs. Even Scott Shane, Professor of Entrepreneurial studies at Case University in the USA, doesn't think entrepreneurs create wealth. He thinks that large established businesses can create more jobs in the USA than entrepreneurs. The fact is that the plucky entrepreneur who sets up a small business that becomes a successful corporation is actually the real myth. The chances of it happening are very small indeed. An article in the New York Times also debunks many of the myths about the small number of entrepreneurs who do make it. Far from being the plucky barrow boys of 'free' market mythology they are well educated individuals who come from middle-class or wealthy backgrounds. These people are usually older than the myth-makers would have you believe and have a track record which often includes business failure. In fact, co-operatives, which are run democratically by workers, have a far better track record of success than businesses set up by entrepreneurs.

'Free' market propaganda has penetrated so far into our media that statements such as "entrepreneurs create wealth" have become almost accepted as axiomatic. I was listening to Radio 4 recently and caught part of one of the business programs which are becoming all the more common these days. The format is that a presenter sycophantically 'interviews' 'successful' businessmen and women and gushes about how rich and talented they are. On this programme I heard one of the 'interviewees' say that poverty could be eliminated in India if there were more entrepreneurs. But this is arrant nonsense. There are already millions of people running their own small businesses in India and the Third World. They are all poor and will remain so. They run these businesses because they have no choice, because 'free' market capitalism has failed to find them a job or a decent living. If they could get a decent job as an employee, they would jump at the chance. This is explained by the economist Ha-joon Chang in this excellent post on poverty in the 'developing' world. And what's more as capitalism fails in the west, more and more people are having to create their own jobs. This isn't a success as some would have you believe, its a failure. A failure of capitalism create decent jobs that people want. In fact, as the 'free' market fundamentalists gain more influence, so the number of real, decent jobs that people would want to have, continues to decline.

The simple truth is the the myth of the entrepreneur is an important pillar of 'free' market fundamentalist belief and propaganda. It enables those who are successful capitalists, who bask in the glory of wealth, to promote an image of plucky success. Don't they richly deserve their vast riches? Didn't they do it on merit? Er....well actually no. Capitalists are overwhelmingly people who inherit wealth, they don't create it. Those that are successful like Gates and Murdoch usually rely on creating a monopoly for success, as Gates did with Windows, and Murdoch did with Sky, not brilliance and dynamism. But don't be fooled, capitalists get wealthy by exploiting the efforts of workers through the mechanism of 'surplus value' as Marx described in Capital. But for the purposes of the 'free' market fundamentalists it is essential that you think otherwise.

Banker's bonuses: why we are being screwed

In September 2008 after the collapse of Lehman Bros bank it became obvious to economists and senior government officials that the world financial system was in danger of collapse, and that banks would be wiped out in the process. In the UK Gordon Brown's Labour government took action and bailed out Royal Bank of Scotland (RBS) and Halifax Bank of Scotland and pushed through a merger between HBoS and Lloyds TSB. In the process the taxpayer acquired 84% of RBS and 47% of Lloyds TSB. The full cost of the UK bailout taking into account Northern Rock and other banks was a whopping £1.2 trillion. The bailout was repeated in other countries, with the TARP, for example, in the USA, and lead to the stabilisation of the global banking system.

What is critical about this is that if the bailout hadn't happened all the banks would have gone bust - not just those who were directly bailed out by the taxpayer. Since 2008 'free' market apologists have tried to claim that banks such as Barclays and HSBC were always OK, as if they would not have crashed, but this is not the case, the fact is that the global banking system was saved by taxpayers.

Lehman Bros HQ

Up to the collapse of Lehmans a culture of huge bonus payouts had become the norm in banking, and in fact when Lehman's collapsed they were still trying to pay out $6 billion in bonuses. After the bailout the culture of huge bonuses continued even at taxpayer 'owned' banks, much to the dismay of the taxpayers themselves. The banking collapse lead directly to an economic collapse which in turn has lead to a sovereign debt crisis.In the process, the UK economy has contracted by 7%. Having paid for the bailout we are now paying for the crisis with the Coalition government's austerity programme. The cost is increasing unemployment, pay freezes, pension cuts  and an attack on the living standards of all but the wealthiest. Bad as things are in the UK, they are far worse in countries like Greece and Ireland, and the Eurozone is itself in danger of collapse.

What does all this tell us? It shows the power of financial capitalism and that our democracies are dominated not just by financial capitalism but also the other big corporations. In the West, which has been hardest hit, politicians have put the interests of financial capitalism above the rights and interests of their own people. The aim has been to preserve the capitalist system and to continue 'business as usual' at all costs, even though it is obvious that the austerity programme in the UK and elsewhere isn't working, at that it will probably make things worse rather than better.

The latest manifestation of the row about bankers bonuses centres around Stephen Hester who is the CEO of taxpayer 'owned' RBS. He was awarded £963,000 in shares as a bonus this year, despite the fact that RBS is still struggling and 33,000 employees have lost their jobs. David Cameron claims there is nothing the government can do about this but that is clearly not true. The Independent revealed that there is nothing in Hester's contract that would prevent the government denying him a bonus. There have been claims that the RBS board would have resigned but so what? They are not the only people who can run a bank. The fact is that the government is taking sides and its not our side, its the bankers side. They are putting the interests of capitalists above our interests. RBS is clearly not being run in the national interest. The bank should be fully nationalised and turned into a green national investment bank to make the loans that  businesses need to help create jobs. That is something that RBS and the other private sector banks are failing to do.

Are we conditioned to capitalism?

On the day of the funeral of the 'Dear Leader' of North Korea, Kim Jong-il, I've been musing about how it is that there has been such an outpouring of grief in that country. North Korea is a 'communist' state, which still has all the trappings of Soviet-style government, and there has been a huge outpouring of grief amongst the population. The grief has caused some some comment and bemusement in the western media, and while its obvious that some of that grief is genuine, the suspicion is held that the grief is largely stage-managed and that many people, living in such a totalitarian state, have little choice but to be seen to display grief publicly. Because its not difficult to imagine how it is possible, through a system of education, rigid control of the media, and a cult of personality, to foster belief in a system of leadership and government, even if that  leadership and government is ultimately corrupt and despotic.

The Dear Leader

Also it is true that In any society there will be those who choose to conform and support the system, often for personal gain, and those who oppose it, and those who oppose are likely to have a torrid time. Because the same is true in the UK as it is in North Korea, if you oppose the system you are likely to be subject to coercion and end up in some kind of trouble. The difference is that how much 'trouble' is likely to be a matter of degree, though the methods are pretty much the same; public ridicule, loss of employment opportunities, harassment, beatings and imprisonment. All those things happen here as well as in countries like North Korea. The difference is that the powers that be in Western capitalist societies stage manage the coercion particularly well by making dissent a criminal activity in order to avoid having 'political prisoners'. Thus active trade unionists find themselves labelled as 'trouble makers' and sacked and blacklisted, opposition politicians are ridiculed in the press, people who demonstrate peacefully are beaten by the police and risk imprisonment because protest has been criminalised. All these things have happened to dissenters in the UK since the election of a Coalition government determined to destroy the welfare state and privatise the NHS.

So how does 'freedom' really square up in the capitalist UK? How conditioned are we to capitalism? Surely we don't have a media propaganda machine and a cult of personality? Maybe its worse than you think. Only recently we've been reminded of the incredible power of the media through the Leveson inquiry, and witnessed the suppression of dissent by the police and the courts, and that is even before we consider the effect of advertising and consumerism in creating 'needs' in a capitalist society. Then there is the co-opting of people by making them, falsely, think they have a real stake in capitalism through things like home ownership, and the use of fear by exaggerating the threat of terrorism. This is a blog post not an essay, and I don't have the time or space to fully consider how conditioned we are to a capitalist society, though I recommend you follow the last two links and watch the excellent documentaries by Adam Curtis. Suffice to say that conditioning must be considerable given the way we tolerate capitalism's creation of poverty, inequality,  exploitation of workers and destruction of the biosphere.

And do we have a cult of personality? A cult of personality is usually based around a ruling dynasty. The media pay rigid obedience to the importance of this 'ruling clique' and show deference, particularly at times of stress. Step forward Prince Philip, who topped the headlines with his stay in Papworth Hospital recently due to a 'heart scare' at a time when millions suffer in silence due to government cuts. Of course I'm not suggesting that Prince Phillip is the 'Dear Leader' of the UK, after all he is only the Queen's consort, just that in the UK, he and his family have been willingly co-opted into the role of figureheads who help to maintain the system and keep all of us in our place.

A Tory driven ideological class war attack on British workers won't promote growth

It was bound to happen here, as it did in Wisconsin and other American states. First the capitalist class, or 1% if you prefer,  creates a crisis, a crisis of financial capitalism which nearly brings down the world economy. It does so through its ideology, neoliberalism; which means destruction of public services by privatisation; letting the banks and corporations run riot through deregulation; and the looting of natural assets by corporations through globalisation. Then, using their tame politicians in the UK, USA and Europe, it makes the middle and working classes and unemployed, the 99%, pay to bailout the banks and save the skins of the bankers. This is privatising the gains and nationalising the losses. Socialism for the rich, capitalism for the rest of us.

So the banks get saved but there is still a big problem because much of that debt incurred by the banks has now been transferred to governments and taxpayers leading inevitably to a sovereign debt crisis, which is where we are now. The Eurozone crisis has been triggered by the sovereign debt crisis brought about by the banking crisis. Still with me? We are nearly there.

In response to the sovereign debt crisis governments in the UK and Europe implement austerity programmes, ostensibly to bailout government debt, particularly in Greece and Ireland. But its not the poor old Irish and Greek taxpayers who are being bailed out, the money is being used, once again, to bailout French, German, Spanish and Greek banks. So taxpayers have been shafted twice, first in the bank bailout and secondly by austerity - which is just another bank bailout.

To top all this the right wing politicians who are the friends of the bankers and the 1%, are now using the crisis to try and smash workers rights. In the USA, in Wisconsin, the Tea Party backed Governor Scott Walker has used the deficit to not only slash services but to try to deny unions their collective bargaining rights. Now in the UK today we hear that the government is contemplating undermining workers rights by making them easier to sack and limiting further their already limited rights to an Employment Tribunal. This crude, class war attack on workers is being carried out in the pretence that it will encourage growth.

The real irony is that the rising unemployment, increasing poverty and lack of growth in the UK are a direct result of this government's austerity programme. Economically, this government is already a complete failure and its only to be expected that it should dishonestly try to pin the blame for that failure on working people and the unemployed, that, after all, is what class war is all about.

God's investment banker still doesnt get it

Nice to hear that the Church of England is beginning to catch up with the protesters at occupylsx. The recent statement by Rowan Williams, the Archbishop of Canterbury, that there is "widespread and deep exasperation with the financial establishment",  is what we should expect from the church - support for the poor against their powerful and rich exploiters - now known as the 1%.

Now, the Bishop of London, he of the chauffeur driven car, has appointed an investment banker to look at solutions to the problems identified by the occupylsx protesters, though you could be forgiven for thinking that a banker is perhaps not the best person to seek advice from, given the problems we have been suffering from since 2008. However, in today's Sunday Telegraph, Ken Costa, Chairman of St Paul's Initiative, has written about markets losing their "moral moorings". He is right of course, but what are his solutions? Well, there is a lot of stuff about civic duty. Essentially we need reform, and we need to get rid of "shareholder value", something I couldn't disagree with, and we need to " reconnect the financial and the moral", and "legislation might help with this", but not yet apparently. Then he goes on to make this telling statement:

"Those in power should understand that governments are incapable of creating new jobs and wealth, that is what a vibrant private sector is for, supported by a vibrant financial services sector. "

I find this statement worrying because it is plain wrong. It is factually incorrect. Of course governments can and do create jobs and wealth. The public sector is essential, not only for delivering services, but it also creates jobs in the private sector as well. What we need is more government intervention to create green jobs in the UK, especially for young people, because the private sector has failed to do so, and is incapable of doing so. What the crash and its aftermath have shown us is that the powers of the private sector are very limited indeed, and that we need governments more than ever to directly create wealth and to help the rest of society to create wealth.

What Costa's article illustrates is that he is trapped in the same 'free' market fantasy as are all neoliberals. Perhaps that's not surprising when we learn from his article that he has been a banker for 30 years. That tells us that he has been part of the problem, and is therefore unlikely to be part of the solution. His pious words about "moral moorings", and patronising comments about the "usual suspects" at occupylsx are a dead giveaway - if we want to get out of this mess we need a radical change of direction, not the tinkering with legislation, appeals to goodness,and papering over of the cracks - however worthy that may be.

The free market fundamentalists are the purveyors of our poverty

I like to describe neoliberals as 'free market' fanatics or 'free market' fundamentalists. I always put the 'free market' bit in italics because there really is no such thing as a free market, and never has been. The 'free market' concept is a crucial part of the flawed ideology of neoliberalism, which is an extreme right-wing ideology that favours the rich - the capitalist class, over the rest of us. An important part of the reason why neoliberalism has been so successful is that it has successfully disguised itself as 'economics', an economics which pretends to be a mechanism for prosperity and has been sold to us as good for everyone.

We have been told by economists and politicians that the tenets of neoliberalism i.e. - globalisation; 'free' trade; privatisation; low taxes; downsizing; outsourcing; and deregulation are essential economically and that without them, we cannot have a prosperous and successful society. But prosperous and successful for who? All the aforementioned things benefit the capitalist class, at the expense of the rest of society. That is how they have gone from being the rich to the super-rich over the past 35 years or so, and these are the mechanisms by which the 1% have left the 99% way, way behind.

The simple fact is that the outcome of this neoliberal ideology, driven by the capitalist class, with the support of Western politicians, is a direct transfer of wealth from the 99% to the 1%. As wages have fallen as a percentage of GDP, profits and income for the rich have risen - see here for the recent US figures. The super rich don't need social security, they don't need healthcare, they don't need state education like the rest of us, so their view is - 'why should I pay for any of that through my taxes'? In fact, 'why should I pay taxes at all'? Furthermore, thanks to globalisation, if they can pay someone in the Third World $1 an hour to make widgets, why should they pay you, as a worker, in Europe or the USA, $10 an hour to do the same job?

But we still live in a consumer-capitalist economy, so as wages have fallen as a percentage of GDP, the 99% have accumulated more and more debt, with the help and encouragement of capitalist lenders, in order to try and maintain their lifestyles, and this is part of the debt crisis, and the economic crisis we are now in. Because if people in 'wealthier' Western countries can't afford to buy the products of capitalism, and are saddled with debt, the consumer-driven economy is bound to be depressed, which is exactly what is happening now. The 'free market' fanatics through the mechanisms of privatisation etc. are therefore purveyors of poverty, through lower wages, unemployment and austerity for us, the 99%.

In addition to the problems of the current banking debt crisis, which was caused by deregulation of the banks and financial capitalism, there is the longer-term problem for capitalism of the falling rate of profit. It has been noted by many observers that capitalism is uniquely versatile and able to re-invent itself when faced, as it always is, by periodic crises. If capitalism reaches a barrier it will find a way round it. So, the big driver for privatisation is the need for capitalist corporations to maintain their profitability, because having exhausted much of the possibilities of the private sector, through globalisation, they are now intent on devouring the public sector in the search for new profitability and never ending growth.

For the 99%, healthcare, education, pensions, housing and social security are essential. Healthcare and education are public goods - not commodities to be bought and traded like widgets. We need social security as a right, paid for through national insurance - not welfare as some kind of handout. We need social housing and pensions so that we can retire with some dignity in our old age. All these public services are best paid for through taxes, collectively, and delivered without the profit motive, for the benefit of all. If we want public services and pensions we need to pay taxes. Low taxes are only good for the 1%, and are bad for the rest of us. In addition to paying more taxes ourselves, we need to make the rich pay much more in taxes, as a prelude to permanent economic change.

Until very recently, we had all of these essential public services mentioned above here in the UK. Now the capitalist class are trying to take them away from us, they are trying to to roll back all the democratic gains our grandparents, and parents made in the 20th century. The banking crisis is being used as an excuse to pay for the failures of neoliberalism through austerity. It is essential that we resist privatisation and cuts in public services by supporting each other, and supporting the occupations, local anti-cuts organisations, student protests, and all the diverse community groups in their ongoing struggle against austerity, and the trade unions in their planned strike action on November 30th.

Last weekend, on 15 October, global demonstrations were held to show the growing discontent of the 99%, and as a result a video was produced - see below, and a manifesto, which is worth reading, and may be the start of global demand for change.



The many thousands of people involved in the occupation movements and protests which are now happening in 900 cities across the world are rightly suspicious of politicians, political parties, and ideologies. They must be able to determine their wants and their own destiny. But ultimately what they need are the things we all need, the public services which I have outlined above, plus work, and freedom of expression, and freedom from fear. What is clear is that they can only achieve their aims by breaking the stranglehold that 'free market' neoliberalism has on our economy and democracies, and to regain control over their lives they must seize control of the economy and make the global economy their economy.

Only when we control our economy will we have the freedom and dignity we all desire and need.

The Neoliberalspeak dictionary

This post was inspired by George Orwell's Newspeak. According to Wikipedia:

Newspeak is a fictional language in George Orwell's novel Nineteen Eighty-Four. In the novel, it refers to the deliberately impoverished language promoted by the state.

Over the past 30 years or so neoliberalism has contributed to the impoverishment of our language by the usage, or perhaps mis-use of certain words. The aim of a neoliberalspeak dictionary is to give some of the key words their real meaning.

• affordable housing / adj. - unaffordable housing. Mythical housing unavailable to most citizens in the UK
• bailout / n.; v. - a method of privatising financial gains and nationalising financial losses
• capitalism / n. - a gigantic global Ponzi scheme designed to benefit a small elite whilst plunging billions of people into abject poverty
• deficit reduction / n. ; v. - a means of class war by which the populations of countries are made to pay for the failures of the markets
• efficiency / n. - increasing profits by lowering the living standards of workers. This is typically achieved by cuts in pay, a reduction in holiday entitlement and reduced pension.
• efficiency savings / adj. - cuts
• Eurozone / n. - proto-European capitalist empire where commercial interests are put above democratic rights
• gig economy / adj. low paid - sweatshop labour
• globalisation / n.; v. - a process of opening up the world to Western economic imperialism. A means of looting the natural resources, exploiting labour in all the countries of the world and lowering the standard of living of workers in the West
• Labour market flexibility / adj. - attack on workers conditions, lowering pay reduction in holidays - cheap labour. 
• privatisation / n.; v. - asset stripping of the public sector by the private sector 
• quantitative easing / adj. handouts for the rich. Printing trillions of dollars to prop up a broken global economy
• Social mobility / adj. - conservative fraudulent frame which is used to legitimise inequality in society
• strong leader / n. - a weak leader i.e. someone who will do what we tell them to against the wishes of their own party and its supporters. we being the neoliberal so-called free press (corporate media)
• sustainable / adj. - unsustainable. A word that has become so debased and devalued as to have rendered it virtually meaningless
• tax / n.; v. - a levy by the state on the 99%
• Trump / n.; v. - a fart, noxious gas released from the anus
• we're all in this together / adj. - you pay for our crisis
• WTO / n. - 'we've taken over' . Global organisation for the purpose of promoting the commercial interests of global corporations above the democratic rights of nation states.

I'm sure that in time the dictionary will grow into a comprehensive guide to Neoliberalspeak. I hope that I'll be able get some contributions from some of the greatest exponents of Neoliberalspeak  such as Nick Clegg, Tony Blair, Barak Obama, David Cameron, Ed Miliband and Nicola Sarkozy.

The Green Party Conference

Plenary session at Sheffield Hallam University

My report of the Green Party Conference has been delayed by work, but my head is still full of ideas after having three great days in Sheffield. One of the best things about visiting any political conference is meeting up with fellow troublemakers.  I met lots of people who I have been talking to online for ages, and it was really good to see all of them.

I arrived on Friday and departed on Sunday after a weekend of passionate debate and very stimulating fringe meetings. The fringe is always an important part of conference, where people come together to discuss ideas and ways forward. There is never really enough time to do much of the debate justice, often, speakers take up too much of the allotted time, and I'm afraid this was the case at conference this year. There were lots of excellent meetings but the two that stood out for me were the 'Living Wage' and 'Greens and Capitalism'.

Jean Lambert (right) speaking at the Living Wage fringe meeting

At the latter fringe meeting there was a rousing speech by Derek Wall, who narrowly missed out on becoming Party Chair this year. The speakers, who also included Jonathan Essex and Jane Ennis,  presented the meeting with a cogent criticism of the crisis of capitalism we are going through, in which ordinary people are being asked to pay twice for the failures of capitalism, first through the bank bailout, and now, through the sovereign debt crisis. The economic failures of neoliberalism are being compounded by the ongoing programme of privatisation and deregulation which is making all of us poorer. 

In the main hall there were a number of important debates on policy and organisational issues. Motions on a moratorium for Shale gas extraction (fracking) and against an immigration cap were passed, as were motions to support One Million climate change Jobs and the Coalition of Resistance. There was a very lively and tough debate about the motion on delegate conferences. The debate was complicated by the fact that the motion presented conference with four options. In the end, conference went for Option 4, which was to re-consider the position when the party membership reaches 25,000. In my view, this was the right result. There are powerful arguments for a delegate conference e.g. delegates represent the views of their local party thus widening representation at conference, which means that more members have a say. But we are still a small party, many local parties don't have the resources to support delegates, and, in my view, as an experienced union steward who attended two Unison conferences and two NUT conferences, delegates tend to be the same people every year, activists who may represent the view of the branch committee, not necessarily the wider membership. I look forward to the time when we will debate this issue again at conference.

Relaxing at conference

I need to mention two of the most contentious motions debated at conference . These were; the GPRC report; and the motion on the GP being a model employer. Both motions criticised the party executive, GPEx, over a contentious staffing change. There was heated discussion at the plenary because GPEx  were being censured for the way they had handled the change, and the way they had communicated their reasons for the change to the Party. In the end, the censure motions were passed. Lets hope that lessons will be learned and we can all move on.

There were also a number of excellent emergency motions on; Legal Aid and Justice for All; Robin Hood Tax; Anti – ATOS; Nuclear Waste Disposal; NHS Listening Exercise; Bombardier - Rail jobs; English Riots; ; and the National Planning Policy Framework.

Overall, it was a great conference, with rousing speeches defending the NHS from Caroline Lucas and Adrian Ramsay which put the so-called Labour Party to shame and consolidated our position as the only mainstream party of the left in England and Wales.

"Free" market corporate domination means mass unemployment - forever

Ever had the feeling you've been conned? Well, you have been, because I've no doubt you've been told that the "free" market will make us all better off, because that is what we are told by politicians and economists on a daily basis. The truth is the opposite, the "free" market will make us all poorer, and that is what is happening in the UK today. But this isn't just happening in the UK, it's happening all over the world.

The most instructive place to find out what is really going on is the USA. This is where the "free" market ideology known as neoliberalism started, at the Chicago School in the mid 1970s. Since the late 1970s incomes for working people in the USA haven't risen in real terms but incomes for the rich (i.e. capitalists) have boomed. The result of this is increasing inequality and increasing poverty. Through globalisation, which is a form of corporate economic imperialism, neoliberalism has spread worldwide.

The principal outcomes of the neoliberal project, which uses methods such as privatisation, deregulation, outsourcing, downsizing and shareholder value, have been squeezing the living standards of the working and middle classes, creating ever greater inequality, rising poverty and rising unemployment.

Wherever you look, in Europe for example, you'll find mass unemployment, even in that much vaunted economic powerhouse, Germany. And unemployment is rising inexorably in the West - 10% (the real figure is nearer 20%) in the USA, 20% in Spain, 6.7% in Germany, 9.8% in France, 8.7% in Italy. The average for the EU is a staggering 9.6%. Moreover, unemployment in these countries mainly affects the young. There are over 1 million unemployed people under 25 in the UK.

I can remember a time, not that long ago, when full employment was an aim for governments in the West. This is no longer the case. Such is the "free" market corporate domination of our democratic systems that the modern assumption by politicians is that job creation is purely a task of the "free" market - governments shouldn't be doing anything about it. If the market can't create enough jobs - that's just tough, apparently. We are told that all will be better in the future. But there is no guarantee of this. In fact, if we continue down this road, things are inevitably going to getting worse. Remember the Banana Republics? - countries dominated by Western corporations with corrupt politicians, wealthy elites, and the mass of the population living in poverty. That is where we are heading. Perhaps the UK will become the world's first turnip republic.

In an interesting Guardian article, the macroeconomist Dean Baker reports how American economists - the very people who dominate economic policy globally - accept unemployment without a second thought. Not only that but they seem to think that it is a good thing that you and I should become poorer. This quote is very illuminating:

"The fact that the overwhelming majority of economists in policy positions failed to see the signs of this disaster coming, and supported the policies that brought it on, did not seem to be a major concern for most of the economists at the convention. Instead, they seemed more intent on finding ways in which they could get ordinary workers to accept lower pay and reduced public benefits in the years ahead. This would lead to better outcomes in their models."

How can this be possible? How can it be that one of the goals of economists is to make you and me poorer? The answer is that this isn't economics; it's right-wing political ideology masquerading as economics. Economics as a discipline has become completely subsumed to the ruling capitalist ideology.

How do we get out of this mess? We have to ditch the “free” market rules all ideology for a start. We need to have governments, which are free from corporate domination and are prepared to intervene in the economy and actively create meaningful jobs. We need a vibrant public sector providing services such as health and education without the profit motive. Most of all, we need political parties and politicians who recognise the need for positive change and can bring these measures into effect. Currently the Green Party is the only party in the UK that has these policies. Come and join us if you want to see real change happen.

Welcome to 19th century free market capitalism

In previous posts I have talked about how neo-liberal 'free' market capitalism is a project which aims to take us back to the 19th Century. Privatisation, de-regulation, outsourcing, and labour market flexibility are all products of neo-liberalism. They are all intended to weaken the rights of working people and their ability to defend their standard of living.

We didn't just get the eight hour day, the weekend, pensions, paid holidays and decent working conditions given to us - our parents and grandparents had to fight for them against capitalist employers who had no intention of reducing their profits for our benefit. We made these gains through organisation, in trade unions and political parties which made democratic gains through the ballot box.

The intention of neoliberalism is to roll back all the gains that working people made, and that would take us back to the 19th century. Neo-liberal politics has been dominant in the west for a generation - it started with Nixon in the USA and Thatcher in the UK. As ever, the Americans are ahead of us. In the USA there are 40 million poor people living in conditions that we in the UK would find shocking. Wages for working people have been static in the USA since the late 1970s, whilst those for the wealthiest have continued to grow ever greater. This isn't about some kind of entrepreneurship as they would like you to think, this is about the rich screwing the people who make them rich - workers.

Today, in the news we were given a glimpse of what '19th century - 21st' century Britain looks like. Romanian children were found labouring near Malvern, picking spring onions. The independent reported:

"The children were among 50 Romanian workers discovered picking spring onions in a field in the Kempsey area of Worcester by the Gangmaster's Licensing Authority (GLA). The seven children, aged between nine and 15, were being made to work from 7.30 in the morning until dusk, dressed in thin summer clothes, as temperatures dropped close to zero."

Of course the Independent, indignant, but missing the point as usual, complained about human trafficking. This isn't human trafficking - its capitalism, pure and simple - this is what capitalism is about. This is what happens when you let the market run without regulation. This is what will happen more and more frequently here and in Europe and America until we bring the market under democratic control. We did it in the past and we can do it again. But when we do it next time we must ensure there is no going back.

How to beat capitalism

Historically socialists have followed the' Marxist' model. By that I mean capture the power of the state and use it to control the means of production. By doing this you can put power into the hands of the people and liberate them from exploitation by the capitalist class. There are basically two ways of doing this: Communism, and democratic socialism. Both have so far failed. Communism, in the Soviet Union, liberated workers and greatly improved the condition of women, but failed to find a successful alternative economic model and degenerated into a dictatorship rather than a 'dictatorship of the proletariat'. Democratic socialism, whereby socialist parties have come to power through elections, has simply failed to control capitalism, again largely because the parties failed to pursue an alternative economic model and were content to 'manage' capitalism through social democracy. I know some people will argue those parties weren't socialist but that's another argument too complex to go into in this post.

There is a pattern here. The key thing is the economy and the creation of money. Having a capitalist economy and a socialist - or social democratic - government doesn't do much for most of the population apart from ameliorating the worst excesses of capitalism. It is certainly preferable to right-wing 'free' market alternatives but it doesn't solve the underlying problem. For a long time, capitalist entities like the big corporations have been more powerful than governments. Many corporations have turnovers which are larger than the GDPs of well-developed nations. Now, through global entities like the World Trade Organisation (WTO) - in which secretive panels of 'experts' are able to overturn national legislation, they have formally elevated commercial interests - the right to make money - above democracy, above all our democratic rights.

What the credit crunch has shown us is the true power of these capitalist entities. The mask has slipped. The 'free' market model has come unstuck through de-regulation, and selfishness and greed - the twin engines of capitalism. We, the poor, the unemployed, the disabled, the low paid, and the working and middle classes, have been forced to bail out capitalism. The losses have been nationalised and the gains are still in the pockets of the people who brought the system down. That is socialism for the rich and the market for the rest of us.

In his book, The Great Transformation, written in 1944, the socialist economic historian Karl Polanyi explained how economies work. He said that they are 'embedded' in society. By this, he meant that they are inseparable from the way we live. They are what we do. This may sound obvious but classical economists, such as Ricardo, have tried to separate the economy from society as if it exists separately in its own right. This is crucial because it allows conventional economists to ignore social and environmental concerns. They just don't figure on the balance sheet. Economists routinely ignore human suffering and environmental degradation caused by capitalism. This helps to give capitalism economic validity because it becomes simply about making money - forget about people and the environment. This is why economists are able to make ludicrous statements like - "It benefits all of us if production is moved to countries where labour costs are lower" - really? Does it? Who does it benefit? Not the people who have lost their jobs and the communities that are devastated. Of course, there have been dissident economists like Marx and E F Schumacher who wrote 'Small is Beautiful - a study of economics as if people mattered'. But Schumacher and Marx have been completely ignored by capitalist academia and media.

Karl Polayni: realised that society and economy are indivisible

Democratic socialists have made a similar error to the economists because they have assumed that politics is also separate from the economy. If you have political power you can change things. But as we have seen that is not true, not unless you change the fundamental basis of the economy. What socialists and progressives need if they are really going to change society is economic power. Capitalism can only be beaten economically. Therefore we need an alternative economic model and we need to start to build that model now. But what is an alternative economy? It is one where the means of production are owned and controlled by the people, and the creation of money is under democratic control.

For the means of production, there are basically two options: Nationalise industries or put them directly into the hands of workers to run and control themselves. Total nationalisation and state control, as in the Soviet Union hasn't worked well because people are not empowered and often they have little incentive to produce anything. They end up still as workers controlled by bosses. The real alternative is economic democracy. This is something that can be achieved through co-operatives. By co-operatives, I mean businesses owned and controlled by the people who work in them. Not possible? Think again. There are already many such successful businesses around. One example is the Unicorn Grocery, a worker-owned co-operative in Chorlton, which is thriving. There are many other examples.

Some cynics will no doubt say that this can only happen on a small scale but I don't believe it. There is nothing to stop larger scale businesses from being run in this way. The co-operatives in Mondragon in Spain provide us with an example of large-scale worker-owned and controlled businesses. Even models like John Lewis and Gore-Tex, which are not wholly worker-owned co-operatives in the sense that the Unicorn Grocery is, offer us a better alternative than voracious capitalists such as Tesco.

The beauty of the co-operative model is that we don't need a revolution or a socialist government to get started. There is nothing to stop people from starting co-operatives now. I have given examples in other posts such as the workers in Argentina who took over factories and started running them as going concerns during the economic crisis there.

In addition to this, we have to put the creation of money, and the control of its supply under democratic control. We need to ensure that only the state, through state-owned banks, rather than private sector banks, can create money. Alongside this, we also need to ensure that there are smaller local and regional banks. We also need a decentralised energy production system where locally owned companies generate energy from renewables and a centrally controlled energy distribution system.

None of this means that we shouldn't bother with socialist or political parties or be trying to get progressive governments elected. Changing our economic model isn't going to happen overnight. We need the support of governments who are friendly and can help with investment. In the shorter term nationalisation of the banks, railways, water, power generators, education, and health is essential for moving us away from a capitalist economy. It's a long haul but this is the only way forward. You cannot beat capitalism politically - it has to be done economically. Socialists and progressives need to start thinking seriously about building a new economy and making it happen - now.