What made me want to write this post was an item I heard on the BBC Radio 4 lunchtime consumer programme You and Yours. I heard about mobile phone customers complaining that they were paying £40 for nothing - no service at all. Some, but not all, of these people lived in the countryside and could never get a mobile signal in their home. I live in mid Cheshire and the mobile signal in my house is poor to say the least, sometimes I get cut off in mid call because the signal drops. The reality is that mobile phone reception varies wildly around the country and there just isn't a good universal service.
So why is this? The answer is simple - privatisation. This is what you get in terms of service from private sector corporations. A couple of months earlier I caught part of a conversation on The World at One, again on Radio 4. This was also an argument about mobile reception and someone was saying that if the service was run by the public sector it would be universal - everyone in the UK would get good reception, regardless of where they lived. That was when he could get a word in edgeways because he was being shouted down by a representative of the private sector who ranted about how much better it was, how private was more efficient, blah blah etc.
More recently I heard someone from Stagecoach being interviewed on BBC Radio 4PM about why they and Virgin could run East Coast Main Line better than the successful public sector company that's run it for five years. The guy couldn't give a good answer to the question, he blustered and floundered and talked about new trains, which are being paid for by the government anyway.
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| East Coast Main Line |
I'm sure you have heard that kind of stuff before. The reality is that the public sector can do many things much better than the private sector can, like running services we all depend upon, and still make a profit which goes to help the taxpayer instead of going into the pockets of foreign shareholders. No wonder these private sector advocates bluster and flounder and have to shout their opponents down. Its because they know damn well they can't compete with a good public sector alternative on efficiency or price, and they know that they are riding the fat privatisation gravy train out our expense. So what we need to do is boot out the profiteers and bring essential services like railways, mobile phone networks, energy distribution and broadband supply back where they belong - into a sector we own and control - the public sector.
I was talking to a friend the other day who was telling me about someone in his family who is a businessman. "What is his business" I said, "property" came the reply. This exchange set me thinking about how capitalism works. For sure, it wouldn't work without 'property', because the concept of private ownership of property is crucial, and without it capitalism couldn't function. When the Soviet Union collapsed and the 'free' market vultures moved in to feast on the corpse, one of their first priorities was to introduce new laws enshrining property rights so that the 'oligarchs' could get their hands on the loot - otherwise known as the common property and resources of the people of the Soviet Union.
So property is a crucial part of capitalism because from property comes rents and the commodification of land, which leads to capitalists cashing in on the exploitation of natural resources such as oil, which ought to be held in common. All these activities which rely on the holding of property can be used to generate great profits but none of them are in any way dynamic or innovative. Much of capitalism is about getting an easy ride like rent-seeking, asset stripping, corporate welfarism and cannibalising the public sector. Far from being innovative capitalists will seek to squeeze every drop of profit from existing commodities and plant and machinery before they bother to think of trying to do something new or different. There are countless examples of this, one recent example being the iPad 3 which differed from its predecessor largely only in having a higher definition screen. And, you can easily see how conservative capitalism is if you go to your local supermarket where you will see the same old detergents wrapped up in packets labelled "new" and "improved" .
Its much easier to make money from what you know. If you have a good product you flog it to death before thinking about a new one. This makes corporations resist change and become conservative rather than innovative, and that, as I've pointed out before on the blog is the reason why capitalists aren't using new, resource efficient methods which would make them more competitive and be much better for the environment - see here. What capitalism tends to be good at is adaptation to changing circumstances and finding a way around the crises it creates. But its the public sector which often leads the way in innovation. Many of the greatest breakthroughs we have seen in medicine, engineering and computing, like the mouse you are using with your PC, come from publicly funded activities. However, for the 'free' market fundamentalists its essential to maintain the myth that the public sector is slow and bureaucratic, whilst the private sector is dynamic and innovative. The problem is this just isn't true.
