We must Occupy the economy

The roller coaster ride of the world economic crisis continues. Elections in Greece and France have shifted the political ground slightly to the left, with a Socialist majority in France, and the spectacular result obtained by SYRIZA in coming second in Greece with about 27% of the vote. But the Eurozone crisis stumbles on and the 'free' market fundamentalists, the architects of the broken economic system, are still in the driving seat. Banks are bust and, under the current system, there is nothing to look forward to apart from years of economic stagnation at best. Meanwhile in the UK, millions are being pushed below the breadline by the governments cuts in benefits, tax credits, and increases in rents.

In 1966, the Marxist economist Paul Sweezy wrote a book, with Paul Baran, called Monopoly Capital, in which he said that the natural tendency of monopoly capitalism was economic stagnation, as capitalists struggled to use the surpluses of capital accumulation, and that they could only achieve this by increases in spend on marketing and defence spending, and increasing debt. Was Sweezy right? Its certainly true that US defence spending in WWII ended the Great Depression, and that a mountain of debt has been used to keep capitalism going in the past 30 years or so.

So what do we do? The market fundamentalists have no answer. They are like the mad person who repeats the same actions over again in Einsteins famous quote:

"Insanity is doing the same thing, over and over again, but expecting different results"

Einstein: described the madness of market fundamentalists

 
So we need an economic alternative. But what is that alternative? Neoliberalism, over the past 30 years has put commercial interests above democratic sovereignty. This has happened globally through organisations like the WTO and the European Union. We need to reverse this process and re-assert democratic control of our economy. This economic change must put governments in charge, actively planning and managing economic development, allow local decision making and create a mixed economy based on  genuine sustainable development to deal with ecological crises and halt endless growth. In the longer term the only answer to the domination of private commercial interests is to put the economy in the hands of the 99%. How can we do all that?

Firstly, we need to nationalise the bust banks that are hoovering up resources which need to be spent on creating jobs. Its a scandal that the UK's bust banks have been bailed out but are still in private hands. This must end, some banks must fold, and we need banks to be broken up to provide finance to small businesses, and local and regional banks which can focus on reviving local economies;

Secondly, we need to take the creation of credit out of private hands and put it under democratic control. Debt creation is too great a power to be left in the hands of private enterprise - this is what caused the current crash;

Thirdly, we need to take control of the big utilities such the energy and water companies, and sectors which rely on massive public subsidy to continue such as the railways;

Fourth, we must institute a programme of investment in our economy to create jobs through green quantitative easing and a Green New Deal;

Finally, and most importantly, we must break the power of the corporations by mutualising the economy, providing the finance to set up co-operatives and giving employees the power to buy-out the companies they work for and control them. This latter measure is crucial in putting economic power into the hands of ordinary people. We need to create a new culture of doing business in which people work together to create successful mutuals which are focused on local communities. Co-operatives have a better success rate than companies and they don't outsource downsize, or export jobs overseas.

Its a little known fact but there was an expansion of mutuals in the USA during the last Great Depression and there are many successful co-operatives both in the USA and here. It is a sector that is already growing. 130 million (yes that is million) people in the USA are now involved in mutuals and if you want to find out more detail read this previous post. You should also take a look at Gar Alperovitz's excellent book 'America beyond Capitalism' which gives practical examples of how the 99% in America are taking control of their economy from the bottom up by creating co-operatives. This is economic democracy in action and something we should celebrate.

Think it can't happen? Well, we have to make it happen. Its likely that the failure of the global banking system is going to mean that states are going to have to take a much bigger role in managing the economy now that the failures of the market have been exposed, and that people are going to be much more willing to trust democratic control and planning after they have experienced the privations of neoliberal austerity. If we want to really cure the malaise of neoliberalism and avoid the stagnation of monopoly capitalism we need to participate in the most important occupation of all, we need to Occupy the economy.

While Cameron schmoozes Murdoch, Greeks and Spaniards are fighting austerity

There are thousands of Spanish and Greek workers fighting to defend their jobs against the dead hand of austerity which is threatening to wreck Europe's economies. You would hardly know about this if you followed the mainstream media, which is instead fascinated by David Cameron's schmoozing of the Murdoch empire, and Simon Cowell's string of girlfriends.

Meanwhile, in Spain thousands of miners have been on strike since the end of May, defending their jobs and communities. In time-honoured fashion the Spanish government have unleashed the police who have been given a free hand to break up the strikes and protests leading to violent clashes. In Greece, striking steelworkers have stopped work for 228 days in their fight to protect their jobs.

So why doesn't this make the headlines? Because it doesn't fit with the media agenda which is the modern equivalent of bread and circuses, designed to distract and manipulate us, whilst pandering to the 'free' market neoliberalism of the corporations and their tame politicians. Its OK to report such clashes in the middle east, in places like Egypt,  because that is considered safe, but in Europe such events are not considered to be "newsworthy".

The big event this weekend is the Greek election and its looking like the Eurocrats have managed to turn the screws enough on the electorate to ensure a government which will support the 'memorandum' which is killing the Greek economy, and causing great pain to the Greek people. If New Democracy and its pro-bailout allies can form a government the Greeks will be ground down even further to protect the banks and the Euro vanity project. We can only hope that SYRIZA and its allies can gain enough votes to prevent this from happening. Since the bailout cannot work, a victory for the pro-bailout parties would be based on fear and ultimately fruitless. Either the terms of the bailout must be renegotiated and the debts written off or Greece will have to default anyway. Whatever happens the European Union has been badly damaged by this attempt to make its people pay for the blunders of the ruling 'free' market elite, who are wholly responsible for the current crisis.

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.

GM technology is not the answer

In the past week a row has broken out over the actions of a group of protesters called 'Take the Flour Back ', which threatened to trash some GM wheat crops being grown as part of field trials in Hertfordshire by scientists from the Rothamsted Research Institute. On the day, the attempt was foiled by Police but the event raised arguments about whether opposition to GM crops is 'anti-science', and whether GM technology should be used in this way.

Jenny Jones, who recently stood as the Green Party London Mayoral candidate, attended the event and wrote a blog post criticising the decision to carry out field trials of the GM crop. As a result she, and the Party, were criticised in a Daily Telegraph blog by Tom Chivers as being anti-science. Of course Chivers could have bothered to look at Green Party policy before heading a blog post "Don't vote Green until they drop the anti-science zealotry", because as Jenny pointed out in her response to him, the Party's position is not anti-science but "sceptical and precautionary", and for very good reasons as I will explore below.

In an earlier post, I referred to an international report by 400 scientists which stated that GM technology was not the answer to feeding the world as has been claimed by its supporters. At the time the report was published the Daily Mail commented:

"Genetically-modified crops are not the solution to spiralling food prices or Third World hunger, according to a powerful international report published yesterday." and

"Professor Watson [UK Government Chief Scientific Adviser] and his team made clear that GM or transgenics - moving genes between plant species - was not the solution to providing plentiful cheap food."

This was a scientific report and the proponents of GM appear to have conveniently ignored this scientific view. Does that mean they are anti-science?

On Monday, whilst driving, I heard Professor John Beddington, the Chief Government Scientist, make supportive comments about the trials on Radio 4, during the interview he referred to the fact that food prices had surged in 2007 as if this was some sort of justification for GM crop technology. What he didn't say however was that the increases were caused by market speculators. A recent report from the World Development Movement said:

"Financial speculators have flooded food commodity markets, creating massive inflation and sudden price spikes. These broken markets are bad news for people in the UK, whose average annual food bills increased by £260 in one year alone. But for people in poverty in developing countries, price rises are disastrous,"

There is no compelling evidence I have seen that GM will reduce food prices and I believe that speculation in food should be banned. Food should not be treated like any other commodity, it is far too important for that. The problem of food shortages is caused by speculation and distribution. GM technology isn't going to solve that problem.

Organic vegetables at a farmer's market in Argentina

But if GM technology is not needed to feed the world what about the actual field trials that are being carried out? Those who oppose the field trials are not 'anti-science', they have legitimate concerns, based on science, that field trials pose unacceptable risks. The danger is that the trials will cause contamination of surrounding plants and crops or will have unexpected effects on organisms the food chain. In this particular trial:

"There is serious doubt that the aphid alarm pheromone as found in this GM crop would even work. Other scientists have raised concerns that if aphids get habituated and insufficient predators are available, this may increase the aphid burden on the wheat and thus potentially increasing the need for pesticides and chemical spraying against aphids."

In a small crowded island like ours these fears are very real, particularly amongst people who support organic agriculture, which would be ruined by such contamination. There is also a danger that the traits in GM crops such as herbicide resistance will be passed on the native plants creating 'superweeds', that there will be knock-on effects on biodiversity and environmental food webs, and harm to human health - see here. The pros and cons of GM are too complex to go into in this post but the key point is that supporters of GM have attempted to paint the protestors as 'anti-science'. This is not true. They are concerned about the use of GM technology, not science or research. They also have legitimate concerns about how this technology will be used by commercial interests.

The fact that the field trials were publicly funded and carried out by Rothamsted has been used by supporters to demonstrate the 'neutrality' of the scientists carrying out the research but according to Jonathan Matthews of the Ecologist:

"And this industry alignment is perfectly illustrated by Rothamsted itself, which partners up with corporations like Bayer, Syngenta and Dupont and has an Institute Director who not only drives a Porsche with a GMO number plate but has a c.v. to match. It is Maurice Moloney’s GM research that lies behind Monsanto’s GM oilseed rape."

Which is why its such a pity that commentators like Will Hutton have chosen to rush to support this slanted and unfair view of both Jenny Jones and the protestors. The problem is, of course, that science can easily be presented as 'progress' and opposition to it as 'Luddite'. Nuclear technology is science-based but there are plenty of good reasons, science based and otherwise, to be opposed to it. There is nothing anti-science about that. My view is that the protestors should have protested but have stuck to the arguments rather than threatening to damage the crops, making themselves an easy target for the likes of Will Hutton. I also believe that public money could be much better spent on research into methods of improving organic agriculture, which is more energy efficient, employs more people, and has the potential to feed to world in a sustainable way without risks to human health or the wider environment.

A report in 2007 concluded that:

"organic methods could produce enough food on a global per capita basis to sustain the current human population, and potentially an even larger population, without increasing the agricultural land base. (from the abstract)"

Perhaps we should re-name it 'organic technology' so that it can be taken more seriously by scientists themselves? But the real problem with organic farming is that it doesn't provide agribusiness with the same opportunity to make a profit. That is why so little research, publicly funded or otherwise, is being carried out.

David Cameron's illiterate class war 'economics'

Once again David Cameron's chums in the capitalist class have seen an opportunity to kick the workers of the UK whilst they are down. Workers who have been subjected to pay freezes and pension cuts to pay for a crisis that was not of their making are to have their employment rights trashed to benefit those  'free' market fundamentalists who helped to cause  the crisis.

David Cameron: economically illiterate class warrior

In time-honoured fashion whenever a UK government has a 'problem' to solve they turn to a 'businessman' for ideas. And those ideas, which are habitually presented as being from someone who is 'dynamic' and 'innovative', always personally benefit the individual who came up with them, and people like him, at the expense of other people, usually workers. In this case, step forward Adrian Beecroft, a venture capitalist and Conservative Party donor, who thinks that fair compensation for loss of earnings at an employment tribunal, and reasonable notice of redundancy are hampering 'growth'. Even people inside government recognise that Beecroft is talking nonsense. See this quote from Garry Gibbon's blog about Beecroft's 15 page report:

"Government aide: “crap – supported by only one person in No. 10,” (Steve Hilton, allegedly)".

And Beecroft  is one of the people behind the company Wonga which provides small short term 'payday' loans at 4214% and have been described by campaigners as "legal loan sharks".

The Daily Telegraph claims this is a war on red tape, but then I guess that the pundits at the Telegraph think that any legislation which makes our society fairer and gives ordinary people decent protection at the expense of their chums in business has got to be a bad thing. I have no doubt that David Cameron's, and the Telegraph's lust for worker-bashing will only be satisfied when most of us are reduced to the abject penury and wage-slavery that they and their 'free' market fundamentalist buddies appear to think ought to be the lot of all UK workers - their own children and families excepted of course.

This is pretty pernicious stuff in itself but what makes it worse is that it is economically illiterate also. These kind of so-called 'structural' changes won't make one iota of improvement to UK growth, in fact, by making people poorer they are likely to reduce it. It was James Tobin the economist who came up with the financial transaction tax known as the Robin Hood Tax who said; "structural labour market policies can make only marginal improvements". 

Just as 'growth' and 'cutting red tape' are the fraudulent excuses for David Cameron waging class war on UK workers, now the government have shifted their excuses for our failing economy onto the Eurozone crisis. Before it was Labour government overspending that was the cause. So, one lie replaces another. Finally, one bit of good news today is that the Guardian now seems to have caught up with reality. Its well worth reading this editorial, and I'm quoting one of the key passages:

"At the heart of this calamitous [government] strategy is a wholesale misdiagnosis of how the market economy functions and a complete failure to understand why the financial crisis took place, the profundity of its impact and its implications for policy. For a generation, business and finance, cheered on by US neoconservatives and free market fundamentalists, have argued that the less capitalism is governed, regulated and shaped by the state, the better it works. Markets do everything best – managing business and systemic risk, innovating, investing, organising executive reward – without the intervention of the supposed dead hand of the state and without any acknowledgement of wider social obligations.

The lesson of the financial crisis is that this is complete hokum that serves the political and personal interests of the very rich."[my italics]

Really pleased to see that the Guardian has at last picked up on my "free market fundamentalist" tag. Someone must have been reading my blog :)

Greece: the frontline in the battle against austerity

In July 2011 I posted on this blog about how 'The Greeks MUST default on 'their' debt'. Getting on for 12 months later that default is looking increasingly likely. The Greeks are being sacrificed for the sake of the Eurozone and the banks. The crucial point is that the bailouts were never intended to help the Greek people. The purpose of the bailouts is to save banks, Greek, German and French banks, NOT the Greek people. The pain the Greeks are suffering is to save bust institutions which made bad lending decisions. Once again, banks are too 'big to fail' but people lose their jobs and go hungry and homeless, or lack access to medicine - that is OK, apparently.

This is appalling and inhuman, and what it tells us is about the kind of economy we live in, an economy where people come a long way second to money, and financial institutions. It also tells us a lot about the EU, and what kind of institution it has become. Angela Merkel had the nerve to talk about Solidarity with Greece. But what is happening is the exact opposite of solidarity. The Greeks are being screwed. It is the Germans who have benefited from years of having a weak currency, the Euro, which has helped them to export. This has been at the expense of Greece and other southern European countries.

In the aftermath of the recent Greek election, now that the parties have failed to form a coalition, the screws are being turned on the Greek people once again. Threatening noises have been made in Germany and elsewhere. There is a clear attempt to bully the Greeks into voting for a coalition in June which will implement to terms of the bailout which have been imposed on Greece. This has come about largely due to the resistance of the SYRIZA coalition which came second in the recent election. Quite rightly, SYRIZA have insisted that the terms of the bailout must be renegotiated because they recognise that the debt can never be repaid on these terms and the Greek economy is being destroyed. Its well worth reading the letter that Alex Tsipras, leader of SYRIZA, sent to Manuel Barroso, President of the European Comission. It is perfectly level headed and points out that the terms of the bailout have to be re-negotiated.

SYRIZA: fighting austerity

So where does that leave us? Another election, in which SYRIZA is expected to gain even more of the Greek vote. And we are today being told that if SYRIZA win Greece will have to leave the Euro. So much for solidarity! The tragedy is that 70% of Greeks still want to remain in the Euro. I can only assume they would feel that it would be a national humiliation to leave. But what could be more humiliating than the position they now find themselves in? A default and a return to the Drachma would be hard. Banks would go bust and close. But the outcome, the longer term would be that Greeks could regain their self-respect, and a much larger measure of sovereignty than they have now. It would be a chance to re-build their economy and it has been done before, most recently in Argentina.

You can be sure that the Eurocrats are shoring up the EU economy as best they can, to protect themselves against a default. What they should be doing is helping the Greeks out of the mess both they and the leaders of Greece have created. Whatever happens, and make no mistake a Greek default could have serious ramifications for the world economy, the EU has been severely damaged by this debacle, which leaves a very nasty taste in the mouth.

After Caroline - what next?

I'm guessing most Green Party members were shocked by the news last night that Caroline Lucas is not seeking re-election as the Party leader. I also suspect that our political opponents will be relieved. As party leader Caroline played a blinder as an advocate for the Party's policies of social justice, economic regeneration, fighting climate change, and support for the public sector. As leader, she is going to be sorely missed, and hard to replace, so perhaps I should have said - "who next?"

Caroline Lucas

After the local elections, and the news of Caroline's departure as leader, Green Party members need to take stock of where we are, before thinking about what they want from a new leader. We are still a minority party and, although we punch well above our weight, we have a long way to go before we can get into government, even as part of a coalition. We keep making gains in local elections but we have failed to make a national breakthrough despite our anti-austerity message and support for jobs and public services. Many people in the party are committed to plugging away, doing the hard work of leaflet delivering and canvassing, and, whilst this is necessary and commendable, on its own it is not enough.

What the Green Party needs is a strategy which will increase both membership and support in the country as well as energising many of our less active members. What's worrying about the GPEW statement about Caroline (link above) is the talk about attracting disillusioned Liberal Democrats, because that is not the best way forward for GPEW. Why? because the Liberal Democrat Party is neither radical nor green, despite what many of its current and ex-members might like to think. It is an entirely conventional, grey, neoliberal party committed to austerity and the 'business as usual approach' so often condemned by Caroline Lucas herself.

Depressingly, there are those in GPEW who think entirely in conventional political terms and would like to see GPEW replace the Liberal Democrats in Westminster. This is delusional politics for two main reasons: Firstly, the last thing the UK needs is another Liberal Democrat Party, even if it was a fairer, greener version, and the voters won't be fooled by any attempt to do this; Secondly, this is a potentially a move to the right, to what some people would see as the centre ground, though centre-right would be more accurate, and risks the GPEW falling into the same trap as the Irish Greens did - I posted previously about this trap here.

The way forward is for the Green Party to strengthen its position as a party of social justice and radical economic change. By the latter I mean an explicit rejection of neoliberalism, austerity, corporate domination, and the democratic deficit in the EU, and a commitment to the alternatives such as the Green New Deal, ending privatisation and de-regulation, saving the NHS, ending tuition fees, government planning, and control of the banks.  What we should be aiming to do is to attract support from the huge pool of young people, many of whom have never voted, and who want real change, and access to jobs. We should also be attracting support from the millions of ex-Labour voters who believe in the public sector and social justice. And we need to do much better in attracting support from the ethnic minorities. These are all potential supporters who are more likely to be attracted by a party offering a radical alternative than many of the disillusioned Liberal Democrats.

As things stand, Ed Millband is likely to be Prime Minister in 2015, if not before. But this will be a victory by default. People will vote Labour to get the Tories out, not because they love Labour, but in the hope that things will be less worse than they are now. There is still plenty of room for a radical party of social justice at the next general election. We are more likely to make gains then, by going down the route I have described, than the dead-end advocated by those who see replacing the Liberal Democrats as the best bet.

One of the things those on the right of GPEW, who oppose a more radical Party direction, need to come to terms with, is that that green, environmental politics and 'free' market capitalism are ultimately incompatible. This is the elephant in the room, and is central to the whole debate about what kind of Party the GPEW should be. The kind of society we Greens want, is more democratic, more fairly regulated, more local, more community based and truly sustainable, and this is anathema to the corporations, because they understand fully that such a green economy would exclude both them and their destructive practices. That is why people like Nigel Lawson of the Global Warming Policy Foundation (GWPF) expend so much energy and cash railing against climate change. And that is why so many commenters in CiF rage about Greens being eco-fascists. They get it even if some Greens don't. As I said in a previous post:

".....you have to ask - why is it that climate change has become a left vs right issue over the past decade or so? Why do right-wingers like Nigel Lawson, of the GWPF, Tory MPs, and Ruth Lea seem to think that all environmentalists are lefties and climate change is a left-wing plot to bring about an eco-socialist world? Why do they object so strongly? The answer is simple - capitalism and corporate profits. The 'free' market right have recognised that climate change is a potential threat to established big businesses and capitalist accumulation, which relies on compound growth."

If Ruth Lea and co. think like that, then it makes Green politics radical and anti-capitalist whether you like it or not. Don't believe me? Then read this excellent article by Naomi Klein, "Climate vs Capitalism", which sums up why capitalists are out to kill climate change and green politics. Here is a telling quote:

"The [climate change] deniers did not decide that climate change is a left-wing conspiracy by uncovering some covert socialist plot. They arrived at this analysis by taking a hard look at what it would take to lower global emissions as drastically and as rapidly as climate science demands. They have concluded that this can be done only by radically reordering our economic and political systems in ways antithetical to their “free market” belief system."

There is no route to a green future in going down the same political cul-de-sac as the Liberal Democrats, and no point in wasting time with the illusion that capitalists will 'see the light' and suddenly become socially and environmentally responsible. In addition, as I've made clear in previous posts, neoliberal capitalism will never revive our economy, and those that believe that existing economic systems can be made to work in the face of climate change are doomed to disappointment and failure.

Finally, there was an interesting post in the Guardian today by party colleague Jim Jepps entitled "Caroline Lucas stepping down is good for the Greens". I do hope he is right. For my money there is only one Party member who has the track record and credibility to replace Caroline Lucas as leader. I just hope he is willing and able to stand.

Footnote:

I just wanted to update this post to clarify some of the points I made in the light of comments I have received here and elsewhere. As for Lib Dems:

1. Lib Dems may be active and disillusioned but do they really share our values? - I don't think so. I'm sure that many ex-Labour supporters and members have values which are closer to our own. I can't pretend this is scientific but it is based on my 40 years of involvement in politics. I am, of course, not opposed to ex-Lib Dem supporters or members who share our values joining GPEW -  In fact I would welcome them.

2. Following on from 1; Five million voters deserted Labour from 2005 onwards, there are over 1 million unemployed people under 25, and many others who are politically disengaged. We also need to reach out to ethnic minority voters. This is a much larger pool of people than disillusioned Lib Dems and these are people we should be targeting. Targeting Lib Dems is a very limited approach for a party that wants to make a breakthrough and shows a lack of ambition as far as I'm concerned.

On Capitalism:

If you have read other posts on this blog you will know that I have been careful to distinguish between "capitalism" and the "private sector". By capitalists I mean people who own the means of production such as Branson, Murdoch etc, people who control and own the the corporations. However, I have no problem with the "private sector". Your local newsagent, pub landlord, tenant farmer, co-operative, and numerous other small businesses etc etc are not capitalists. I welcome the contribution these people make to our economy, in fact, I think it is essential. The problem of "capitalism" centres around the power and sheer social, economic, and environmental destructive capacity of corporations and financial capitalism, including the banking sector. If we want social justice and to fight climate change and deal with resource depletion we will have to move away from the current "capitalist" model which is unsustainable in any case, as I have argued above, and in other posts.

A key part of the purpose of this blog as far as I am concerned is to share ideas and stimulate debate so I welcome both comments that are supportive, and those that are critical, the latter as long as they are constructive and deal with the arguments. I don't publish comments from people who are simply out to slag me off or be abusive.

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

Will Hollande beat the EU austerity stitch-up?

Good news for all those on the left of politics who want to fight the neoliberal austerity programme being forced onto the people of Europe by the EU! -  Francois Hollande has been elected President of France on an anti austerity ticket and the Greek parties New Democracy and PASOK who collaborated in the EU, IMF and  ECB bankers carve-up of Greece have been battered in the latest elections.

The problem remains that the European neoliberal elite of politicians, bankers and corporations who run the EU are committed to crushing all democratic attempts to derail their austerity programme, which is designed to protect banks and bondholders at the expense of ordinary Europeans. As I've blogged before, previous attempts by the people of Europe to stymie this elite have been defeated. The Irish, French and Dutch people tried and failed to block the European constitution (we were told it wasn't really a constitution) in referendums but the attempts were in vain.

The Euro-elite have a way of dealing with the inconvenience of democratic decisions - they make you vote until you give them the required answer. This has happened in Ireland - twice. Now that Hollande has been elected and the Greek pro-austerity parties have been humiliated, you can be sure that Brussels and Berlin will be working overtime to ensure that their plans can't be derailed.

The obvious answer in Greece, as it has been in other European countries before, is to make the Greeks vote until they come up with a pro-austerity choice. New Democracy has failed to form a coalition, lets hope that SYRIZA can do it, if they can't, its likely that the `Greeks will be required to vote once again. As for Hollande, we can only hope that he is serious in bringing about real change, and even if he is, then he may be bullied into submission for all we know.

Need the European elite worry about the inconvenience of democracy ?

So conformist and robotic has been the acquiescence of Euro-politicians to neoliberalism and austerity that its tempting to think that they must have Euro-microchips fitted before they are allowed to take power. Lets hope that Hollande can avoid this fate. Whatever happens its clear that the European people, when they get a chance, want no truck with austerity, and the sooner the left can get its act together and respond to this the better. In the UK the Green Party have made a good start, but its time for others to stand up and follow.

We need boldness to replace the weak timidity of the Coalition

When people are under pressure they often retreat into what they think they know, and what makes them feel safe. The global economic crisis, triggered by the banks and the collapse of Lehman Brothers in 2008, threatened to bring down the whole global economy and capitalist order. The response, lead by politicians in the UK, including Gordon Brown and Alastair Darling, was to use the power of the state to preserve the status quo. Losses were nationalised and profits remained in Wall Street and the City as taxpayers were required to bail out the private sector banking system. The aim was to restore "business as usual", as if nothing had ever happened.

Since the 2010 general election in the UK, David Cameron and George Osborne, have continued to use the British state to maintain "business a usual", playing the class war card and ensuring that corporations and the rich continue to be shielded by making the rest of us pay to reduce the structural deficit and prop up the banks. As long as the 'markets' and bondholders are safe, the rest of us can go hang. The recent budget provided ample evidence of this with the top rate of tax being reduced to 45% and Osborne later claiming that, even though he is a millionaire, that he didn't know that wealthy people pay lower taxes overall than the rest of us.

But its not just the ongoing economic crisis that we should be concerned about, we are facing a crisis of resource depletion and climate change. Far from being a sign of strength as, Cameron, Osborne, Brown and Darling have claimed, in 'protecting' 'our' economy they have shown weakness. Brown and Darling could have taken the opportunity of the crash to bring the banks under control, Cameron and Osborne could have taken the opportunity of election victory to re-engineer our economy to deal with the very real challenges we face. They all failed. The same mistakes have been reproduced by Sarkozy and Merkel in the EU, making the Eurozone crisis even worse, something which the economist Joseph Stiglitz has recently described as a "suicide pact".



What we need now is politicians like Caroline Lucas who have the courage to cast aside the failed 'free' market neoliberal ideology of business as usual and build an economy which can deal with the very real challenges which we face. Sadly, there is no hope of this happening with this government, Cameron and Osborne will continue to protect the interests of their class, and fiddle while Rome burns, but lets be clear - what they offer us, apart from years of hardship is, for all the posturing, not strength, but weakness in the face of adversity.

Globalisation and austerity - so many rotten apples!

A few years ago, after more than a decade of battling with Windows, with viruses, system crashes, obscure drivers and innumerable updates I decided to buy a Mac. Now Macs are outrageously expensive compared to PCs but they do what they say on the tin, quickly, efficiently and simply, and, since then, I've had trouble free access to the web and have even been able to edit my own videos! So it was worth it. But, and the but is - that I've become increasingly disillusioned by what Apple does, and how it operates. Thanks to the iPhone and other products,  Apple has become the biggest company in the world, with billions of dollars, reputed to amount to $100 billion, sloshing around in its back pocket, so much in fact that it didn't seem to know what to do with all that dosh. Hmmm? ... after some thought Apple decided to hand over some cash to its shareholders.

No surprise there then, but what is wrong with Apple? For some time there has been growing concern about the treatment of workers who make Apple products at Foxconn in China. Workers at Foxconn, who make iPhones and iPads,  have protested about working conditions and Reuters reported today that:

"Workers at a Chinese factory owned by Foxconn, Apple Inc's main manufacturer, threatened to jump off the roof of a building in a protest over wages just a month after the two firms announced a landmark agreement on improving working conditions."

But what's more is that Apple has a huge profit margin, something that most corporations would die for. A recent article by Aditya Chakrabortty in the Guardian revealed that:

"Assembled in China, the total cost of putting together just one phone was $178.45. Compare that with a sale price (including downloads) of $630 and Apple makes $452 on each phone: a whacking gross margin of 72%."

This is mind boggling enough, but what the article also showed was that if Apple made the same product in the USA it could still make a whacking 45% profit! So why bother to outsource production to China?

Its not just Apple, because Apple is doing what every other corporation is doing nowadays, screwing every last drop of profit out of consumers and workers for the benefit of a tiny minority - the 1%. This is what globalisation and neoliberal capitalism are all about, a global race to the bottom in environmental and labour standards which is threatening the prosperity of societies all over the world, and puts commercial interests above democratic sovereignty through organisations like the WTO. If you want to know more about how globalisation works I recommend you read the excellent essay by Michael Parenti called Globalisation and Democracy. As Parenti says:

"With international “free trade” agreements such as NAFTA, GATT, and FTAA, the giant transnationals have been elevated above the sovereign powers of nation states. These agreements endow anonymous international trade committees with the authority to prevent, overrule, or dilute any laws of any nation deemed to burden the investment and market prerogatives of transnational corporations."

Henry Ford - a capitalist who understood that workers have to be able to afford to consume

Now, the world economic barrel is full of capitalist rotten apples, corporations which are allowed to ride roughshod over social and environmental legislation whilst they devastate communities and economies. As I've pointed out in a previous post, neoliberalism is ultimately self-defeating because it is economically unsustainable, as well as being environmentally unsustainable. You can't have a consumer capitalist economic model if no one can afford to consume, and that is where we're headed -  Henry Ford realised that a hundred years ago. There is a big problem here because neoliberal globalisation and austerity are going to create a huge number of human casualties, and things are going to get a lot worse before they get better. We need an economic alternative now, with governments leading the way in Europe for investment and job creation, and providing social housing and healthcare, that is why we must hope that Hollande will become President of France and why you should vote for the Green Party in the forthcoming local elections.

A Green vote is a vote against austerity!

The savage cuts of £81 billion imposed by George Osborne in the Coalition's so-called emergency budget in 2010 were designed to make the ordinary people of the UK pay for the sovereign debt crisis which resulted from the financial crisis caused by banks. These are the very same banks that had already been bailed out to the extent of £1.2 trillion by the UK taxpayer. At the time, Osborne and David Cameron cynically claimed that "were all in it together" but they knew that the cuts would fall disproportionately on the low paid, unemployed and disabled, and would hit women particularly hard. The savage cuts imposed by the Coalition are unprecedented in the history of the UK and are driven by ideology, not by necessity, as has been claimed. The government cuts will lead to 700,000 job losses in the public sector, causing further hardship to those already bearing the brunt of the cuts and will probably lead to economic stagnation in the UK for at least a decade.




In our 2010 manifesto the Green Party provided the UK with a radical and positive economic alternative to this savage austerity programme. We planned to halve the deficit in five years without cutting public sector services or jobs and invest £44 billion in creating one million green jobs, and our programme, based on cutting unnecessary government projects like Trident, environmental taxes to cut pollution, and taxing the better off, was fully costed. This approach, if adopted, would have mitigated the worst effects of the financial crisis and created hope for millions in the UK.

The Coalition government have cynically left local councils to implement much of their cuts and councillors are left in a position where they will struggle to support vital local services and protect jobs. Despite this Green Party councillors and candidates in the forthcoming election are determined to do all they can to maintain the local services that people need. In Brighton and Hove, our first Green council is the the most democratic and open in the borough's history and has introduced the living wage for council staff, and is fighting to protect the victims of the cuts. If you want change there is a real alternative to the despair and destruction being wreaked on communities in the UK. On 3 May, vote Green!

Supermarket dinosaurs deserve to die

Tesco is in trouble. For the first time in many years sales at the supermarket behemoth are declining, and although I've been carrying out a one-man boycott of Tesco's for several years, unfortunately I can't claim the credit for this. When I say boycott, what I mean is that I never do my main weekly shop in Tesco. Sometimes I have had to buy something in a Tesco Express, partly because of expediency, but also because Tesco has now become so ubiquitous that it is hard to find an alternative store in many neighborhoods and city centres.


Why did I decide to boycott Tesco? There are two main reasons; Firstly, it is just way too big. Any company which takes £1 out of every £7 spent in the UK has to be a bad thing for the UK economy. This is monopoly capitalism at its worst, and much of the money made by Tesco is inevitably going to go out of the UK into the hands of foreign shareholders, but more of that later; The second reason is that I found Tesco poor value for money, and I didn't like the quality of the food much either.

Tesco, monopoly-capital Behemoth

It seems that I'm not the only one. Lots of other people have similar problems with Tesco. In fact, I'm sure that Tesco could learn a lot about why people don't like it by reading this article. Here is just one comment:

"The brand has been tainted by greed and cynical and exploitative practices. That means that no one has any feeling of affection or loyalty that could see it through a sticky patch. I actively avoid Tesco's and, like many others, would be pleased to see them cut down to size. So, I'm really not sure where they go from here as I can't imagine anything that they could do which would make me love them".

..... which I like because it took the words right out of my mouth. The problem with Tesco is that they epitomise all that is wrong with the over-mighty corporations which have arisen as a result of monopoly capitalism. We are told that these corporations are good for the economy because they are 'efficient' but this  so-called 'efficiency' means market domination (30% for Tesco), squeezing that market at both ends by shafting the supplier and customer, exploiting low paid workers to maximise profits, damaging the environment with megastores, and contributing to the devastation of local high streets by reducing diversity and putting small stores out of business.


This is what happens with monopoly capitalism, across the board not just in the food retail sector. When a few corporations dominate a mature market they don't compete on price anymore - though that's what they want you to believe - they focus on slashing costs and using advertising to maximise their profits, and this is at the expense of employees, customers and the environment. Corporations want you to believe the customer is king but to quote Fred Magdoff and John Bellamy Foster:

"Under a mature monopoly-capitalist system, people serve the economy and not vice versa. The much ballyhooed "consumer sovereignty" is transformed, as John Kenneth Galbraith pointed out, into "producer sovereignty".

This is from their excellent book - 'What Every Environmentalist Needs To Know about Capitalism' - which explains how monopoly capitalism works, and a book I would recommend everyone to read.

Of course its not just Tesco which is the problem, its all of the giant monopoly capitalist corporations which are devouring our planet in their insatiable drive for capital accumulation. But in the UK Tesco embodies this destructive monopoly more than any other corporation, and many people are conscious of this, despite all the advertising and hype. Maybe Tesco will be able to turn it around. But that would be a pity because what we need is thriving local businesses selling locally grown good quality food, not corporate giants devouring the environment and our high streets. I won't be shopping there ever again, if I can help it. The best thing for Tesco would be for it to be broken up into local co-operatives that really served the communities they are based in.

Twenty first century corporate capitalism is about creating monopoly, about endless growth and capital accumulation, not efficiency or building a socially useful economy, and it lies at the heart of the sociopathic disease of neoliberalism which is damaging our economy and destroying our planet, and we would all be better off without it.

Is there a cure for homophobic Christians?

The recent furore about anti-gay ads on buses in London, has shone the spotlight on the shadowy activities of evangelical 'Christian' groups who claim to be able to 'cure' homosexuality. It all began when the gay group Stonewall paid for an advertising campaign on London buses with the slogan - " Some people are gay. Get over it!". So far so good, nothing wrong with challenging homophobia, but predictably, an evangelical Christian group - The Core Issues Trust ("God's heart in sexual and relational brokenness") - retaliated with a bus ad which read - "Not gay! Post-gay, ex-gay and proud. Get over it!". The ad was immediately banned by Boris Johnson, the London Mayor, who is obviously sensitive about such issues in an election period and doesn't want to alienate the gay vote in London. Predictably, The Core Issues Trust are now considering legal action.

What really matters about this story is the fact that ultra-conservative Christian groups have been peddling 'cures' for homosexuality for some time now. These bigots, who are clearly unable to cope with the reality that God created homosexuals, if you believe in God that is, are tormenting gay Christian men and women with the 'hope' that they can be heterosexual. This is not just extremely offensive, it is psychologically damaging to those who are subjected to this cure and and encourages prejudice against gay people. The American Psychological Association (APA), the world's largest association of psychologists has stated that:

“Homosexuality is not a mental disorder and the APA opposes all portrayals of lesbian, gay and bisexual people as mentally ill and in need of treatment due to their sexual orientation".

What should really concern us is whether there is a cure for so-called Christians who are prejudiced against gay people. I believe there is - they just need to follow the teachings of Jesus and start behaving like real Christians, leaving their bigotry behind them. In the meantime if you want to help diminish the malign influence of these 'Christian' groups please sign this petition which calls upon MPs to refuse to use the services of interns provided by the 'Christian' group CARE which sponsors 'gay cure' events.

Why capitalism won't exist in 50 years time

I've been reflecting on the Coalition government's claim that the market will make up for the 750,000 public sector jobs that are going to be lost under the austerity measures imposed by Chancellor George Osborne. In his first emergency budget, which introduced £81 billion of cuts, Osborne claimed that the private sector would take up the slack by creating 2.5 million jobs. Clearly that hasn't happened, but what if it never does? Why should the private sector create that number of jobs in the UK anyway? In a golbalised economy it may be that the market will provide jobs elsewhere instead, or maybe the jobs will just never materialise.

Of course, Osborne never mentioned what kind of jobs would be created, but its a fair bet that the jobs, if created won't be as good as the public sector jobs that have been culled by the government. Not all public sector jobs are well paid by any means but many are highly skilled, and nearly all offer better benefits than private sector equivalents. Its likely that many 'replacement' private sector jobs will be low skilled 'McJobs'. To add to the existing problems in the job market, Osborne is now trying to implement a long held dream of the Tories to 'regionalise' public sector pay in order to drive down wages still further, on the excuse that the private sector will be able to compete in the jobs market with their McJobs. This is likely to backfire on the government because public sector workers will seek to keep pace with those in similar jobs around the UK, leading to more disputes and industrial action.

There is still the question of whether any jobs will be created. The record is not good. Its worth reading this article by Larry Elliot which shows that in the past 100 years the private sector has failed to replace jobs in the North of England lost when heavy industries such as shipbuilding, cotton manufacture, steel-making, and coal mining went into terminal decline.The reality is that Osborne's approach is going to hit the North, which is already suffering, very hard. That is part of the reason for George Galloway's recent victory in Bradford West - people are fed up with a lack of jobs and opportunity and the fact that none of the three main parties are offering an alternative to austerity.

My view is that the oft promised jobs will never be created. For sure, as long as we follow the discredited 'free' market neoliberal ideology beloved of Mr Osborne. Why? -  because we have entered a different, and, I believe, final, phase of capitalism. There are a number of different factors working here to bring about the demise of capitalism as we know it;

Firstly, the rise of financial capitalism, fuelled by deregulation of the banking and finance sectors. If you want to get the best return and make money you invest in financial instruments, and property, that is the quickest and easiest way to make a buck. There are currently trillions of dollars flooding this financial system, and none of it is being invested in job creating industries. The problem for capitalists is that the 'real' economy is suffering from falling profitability;

Secondly, the model of consumer capitalism on which we currently rely for our prosperity is slowly breaking down. Consumer capitalism really started in the 1920s with Edward Bernays, and only really took off in the period of prosperity following WWII. Bernays, who is often called the father of Public Relations is credited with creating consumer 'wants' rather than the 'needs' that existed previously. Neoliberalism is undermining that consumer-lead model though globalisation by making people, particularly in the affluent west, poorer. You have to earn a decent amount of money to support the consumption that consumer capitalism needs. In the USA consumer spending is 70% of the economy. That is why neoliberal capitalism is relying increasingly on, the creation of debt to sustain consumerism, the cannibalising of the public sector, and corporate welfarism, to maintain its failing profitability;

Edward Bernays - the man who invented consumer capitalism

Thirdly, and most importantly, we are reaching the limits to growth. Resources, and oil in particular, are becoming depleted, which means that capitalist expansion is becoming impossible. capitalism relies upon compound growth, and you don't need to be a Nobel prize winning economist to understand that this kind of growth is unsustainable.

The fourth factor may prove to be the most important - climate change -  which is likely to damage the global economy further by extreme weather events like the recent tsunami in Japan, and damaging agriculture, thus limiting food production. That is an issue which I have covered extensively on this blog. Attempts to postpone the inevitable end of 'business as usual', such as the exploitation of shale gas and tar sands, are likely to be self-defeating.

If you want to know more about monopoly capitalism and how this crisis is being driven by factors one and two then you should read the excellent book 'The Great Financial Crisis' by Magdoff and Foster, which explains how capitalism has increasingly invested in finance, at the expense of the real economy.

I just want to finish this post with a prediction. Capitalism as we now know it won't exist in 50 years time. I won't be around to see it but I have no doubt that capitalism will reach its limits, economically and environmentally in the next 50 years or so. What we ought to be doing now is planning for the future. That future will inevitably mean more state intervention, not because of ideology, but because of necessity. In 2008, when the global economy was crashing, the state came to the rescue. There is no doubt that it will have to come to the rescue again because, by then, 'free' market fundamentalism will have brought the whole house of cards crashing down.