Tag: corbynism

Why capitalism is safer in Corbyn’s hands

By Daniel Margrain

“If we don’t get inequality under control then it’s likely to lead to war. Inequality and the rise of a super rich elite is undermining the foundations of capitalism. The trappings of capitalism could be swept away by the pitchfork of revolution unless capitalism is fundamentally re-imagined.”

The above is not a quote by Jeremy Corbyn, Nicolas Maduro or Bernie Sanders, but by American venture capitalist, Nick Hanauer. During a 2015 interview with BBC journalist Stephen Sakur, Hanauer said, “If capitalism doesn’t change fundamentally, it will destroy itself.”

“In my state”, he said, “since 1990, close to 100% of growth has been accrued to just 1% of the top earners. People are beginning to get angry and increasingly less patient with a system that rewards nearly all of the benefits of growth to a tiny minority at the top.”

This ‘gushing upwards’ of capital towards the top of the socioeconomic pyramid is not indicative of regulated free-markets, but an extreme form of crony capitalism in which the publicly owned assets of the state are systematically stripped and the spoils distributed to an elite economic and political class.

The potential bailing-out of Carillion, farm, housing and rail subsidies, public sector retrenchment, quantitative easing and share giveaways, are some of the ways in which corporate welfare continues to greatly enrich the wealthiest in society. Figures reported in the Guardian indicate that the richest 1% in Britain have as much wealth as the poorest 57% combined.

No morality

Hanaeur is clear that his argument isn’t intended to be a moral one but a pragmatic solution to a growing crisis: “I’m not saying that we capitalists should pay workers more because we feel sorry for them. But the more they get paid, the better it will be for venture capitalists like me”, he said.

Hanaeur added:

“The more money ordinary folks make, the greater the opportunity people like me have to innovate, create enterprises and sell them stuff. The better they do, the better I do.”

When Theresa May recently described capitalism as the “greatest agent of collective human progress ever created”, what she failed to grasp, but what Hanaeur understands, is that economic growth is the culmination of collective human labour. In other words, it’s the latter that gives rise to what Hanaeur terms a “thriving middle class”, not the other way round.

Similarly, in her critique of the austerity myth, author of The Production of Money, Ann Pettifor, argues cogently that “taxes are a consequence of investment and spending. They are not its cause.” The cornerstone of Tory economic policy is not to invest to stimulate the economy in order to boost growth and generate tax revenues, but on the contrary, to attack the welfare state and public sector which has the reverse affect.

What Theresa May and other apologists for the existing system really mean, is not that capitalism is the “greatest agent of collective human progress ever created”, but rather that neoliberalism is the best economic model through which the elite class are able to financially enrich themselves by manipulating the institutions of society.

It is not only leading politician’s on the political right of the spectrum who apparently have difficulty in untangling socio-environmentally protected notions of free trade from the cronyism associated with its neoliberal capitalist variant, but mainstream political commentators also. On Twitter (January 17), for example, radio presenter Julia Hartley-Brewer, spectacularly mischaracterized Jeremy Corbyn’s correct evaluation at PMQ of the Carillion crisis.

He means “capitalism”. It isn’t perfect, that’s for sure, but it’s a millions times better than the alternative Corbyn is proposing.

Julia Hartley-Brewer added,

Presumably, Hartley-Brewer is of the opinion that consumer-based capitalist economies can be driven with only the extreme wealth of the few and that any attempts to buck the market by ensuring that employers pay their staff a minimum wage of say £10 an hour will bring the said economies to their knees?

Reining-in

Hanaeur, whose primary motivation is to make money, recognises the absurdity of this kind of ‘booster of globalization’ argument. In the BBC interview outlined above, the venture capitalist argues that rather than being set free by deregulation, capitalism needs to be controlled through a system of planned and coordinated regulation:

“Capitalists have the idea that their things will be bought by everybody else as a result of higher wages paid by other capitalists”, he said.

Hanaeur added:

“But this logic of paying higher wages to staff to help improve business activity more generally, is resisted since capitalists will insist on paying their own workers next to nothing thereby not absorbing the costs themselves.”

Hanaeur’s argument can essentially be summarized thus: There is a need for capitalism to be reined in, in order to save the system from the rapacious actions of competing capitalists who are driven, as Marx put it, by their need to “accumulate for accumulations sake”.

In principle, Hanaeur’s view is no different from the minority of capitalists in 19th century Britain who argued in favour of the introduction of the Factory Acts of the 1830s and 1840s which set down a maximum length for the working day.

Hanauer’s pragmatism is closer to Jeremy Corbyn’s vision for society than it is to Theresa May’s and underscores the undeniable truth that the ability to accumulate for accumulations sake doesn’t necessarily lead to higher profits.

Contradiction

One of the contradictions inherent to capitalism is that the system as a whole needs to spend money to make profits, yet every individual capitalist wants to spend as little as possible. The lengths to which giant companies like Amazon, Google and Starbucks will go in order to avoid paying tax shows how this dilemma is played out.

The failed neoliberal austerity experiment is what economist Paul Krugman describes  bluntly as “a con that does nothing but harm the wealth [of nations]. It has been discredited everywhere else: only in Britain do we cling to the myth”, he said.

Contrary to mainstream media mythology, Corbynism and the notion of a reformed capitalism are, counter-intuitively, congruous concepts. It’s not only aspects like health and social care that are safer the further they are, ideologically, from neoliberalism, but from the perspective of capitalism’s longevity, so is the economy.

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September 12, 2015: the day Blairism died

By Daniel Margrain

The momentous nature of Jeremy Corbyn’s landslide victory  one year ago should not be underestimated. It has to go down as one of the most sensational and politically earth shattering events in modern British political history – the impacts of which sent tremors throughout the entire establishment. After the announcement was made that Corbyn had won, it was obvious that the smiles, handshakes and applause of the vast majority of the calculating and opportunistic labour elite were as a fake as Blair’s claim that Saddam was about to attack Britain within 45 minutes.

A pointer to the overwhelming inspiration underlying Corbynism was the fact that no less than 160,000 volunteers who seemingly emerged out of nowhere, were recruited to the cause. The grass roots support that Corbyn engendered – by far the biggest of its kind in history – was almost certainly the catalyst that propelled him to victory. Although the activists were mainly young people, they were by no means exclusively so. In fact the demographic was wide ranging.

Corbyn’s straight talking, lucidity, and unambiguous commitment to a programme of anti-austerity brought many older activists who had felt betrayed by the direction the party had gone under Blair, back into the fold. To put Corbyn’s victory into context, he secured a higher percentage of votes than Blair in 1994  Even more significantly, the 554,272 votes he achieved was more than double Blair’s, and no less than 76 per cent of them actually voted, a higher percentage turnout than Blair received.

This suggests that ‘Corbynmania’ is no ‘flash in the pan’. On the contrary, it represents a new hope for people that society can make a great leap forward from the decades of Blairism where nothing happened, to weeks where decades happen. Neoliberal ideology and the cementing of the Red-Tory axis, which for many was perceived to have been fixed and immutable has, with the rise of Corbynism ,the potential to be swept into the dustbin of history. All that is solid really can melt into air.

When Corbyn was first nominated, he was seen by his opponents – both inside and outside the party – as a joke candidate. But an indication of how seriously he has been taken since he became leader is the extent to which the mainstream corporate media and Tory establishment continue to unanimously attack him.

Tories such as Gove, Fallon, Cameron, Osborne and Patel who thought an opposition party lead by Corbyn could only enhance their political careers, were the ones who subsequently read out an unsubstantiated claim contained within what was clearly a widely circulated Whitehall-issued memo which asserted Corbyn was a threat to national security. Gove then went on to misquote the Labour leader by implying he was economically incompetent and an apologist for Osama bin Laden.

The smearing wasn’t restricted to the media and Tories. On the labour side, around twelve MPs ‘lent’ Corbyn their support ostensibly to widen the contest. Blairites such as Margaret Beckett who nominated Corbyn clearly as a tokenistic gesture, described herself as a moron after Corbyn won. His victory had therefore rebounded back in her face.

No sooner had Corbyn’s victory based on clear and unambiguous principles been announced, then threats to resign by ‘modernizing’ frontbenchers followed. According to the Daily Mail at the time of Corbyn’s election victory, among the Labour figures refusing to serve in his team were high profile prominent Blairites Chris Leslie, Tristram Hunt, Emma Reynolds, Vernon Coaker, Michael Dugher, Shabana Mahmood, Mary Creagh and Lucy Powell. I’m sure the Tories will welcome these unscrupulous careerists with open arms.

The resignations were undertaken on the basis that Corbyn’s programme was too ‘extreme’. Is a refusal to be a part of the Labour friend of ethnic cleansing (sorry, Israel) rump within the party ‘extreme’? Is supporting the nationalization of the railways and utilities ‘extreme’?

Is it also ‘extreme’ to oppose nuclear weapons, war, the growing wealth gap and supporting the need for a massive affordable house building programme that benefits the mass of the population? How can it be that as far as the PLP are concerned, all these things are regarded as ‘extreme’, yet the bailing-out of bankers that benefit nobody other than bankers, is not?

It’s precisely the kinds of principles Corbyn espouses that has resulted in the regurgitation of the official/media meme which criticises him for voting against his party 500 times. This is represented as disloyalty. The notion that he might have voted against the Tories, while most of his Blairite colleagues, many of whom are war criminals, voted with them, is quietly forgotten.

The notion that the Blairites within the PLP will willingly work alongside Corbyn after having spent a large part of the past year conspiring against him – despite the elected leader’s continued attempts at reconciliation – is, I would suggest, delusional. If he wins the election on September 24, as expected, it’s almost certain that the war of attrition against him will continue. Any reluctance to act decisively against the destabilizing elements is likely to be seized upon resulting in a possible split within the party.

Corbyn might be banking on the possibility that a newly elected pro-Corbyn NEC will reinvigorate the party further from the grass roots up leading to a dissipation of the Blairites by stealth, akin to the melting of ice enveloped by steam. As the parties grass roots expand, the reliance on corporate funding and large individual donations lessens. This will give more confidence for Corbyn and his allies to expose, as John Moon put it“the ongoing immoral motivations and machinations of their elected Blairite MPs”, thus initiating the possibility of deselection at the grass-roots level.

A year ago, I heard Ken Livingston on LBC say that under Corbyn the party will unify with little signs of any attempts to undermine him. In terms of the latter, he has been proven wrong. We await the outcome of the former. My fear is that in the absence of any purging of the Blairite clique, the gap between the ideology represented by the elite within the hierarchy of the party and the multitude of its members is so vast, as to be irreconcilable. I strongly suspect that something will have to give as the party moves forward, but we will see.

The idea that a highly principled leader of a party who espouses peace and reconciliation can reconcile two diametrically opposing forces, seems to me to be a bridge too far. But equally, the notion that these irreconcilable forces are able to keep Blairism teetering on the edge of the precipice by its fingernails indefinitely, is as misguided as the insistence that a free-falling object is able to resist the gravitational pull of the earth.

As I type this, I’m watching Corbyn being interviewed by the BBC in relation to the proposed boundary changes against a backdrop in which fellow comrades are seen uniting behind those protesting against the police brutality at Orgreave. A year ago a newly elected Corbyn was protesting at a rally about the terrible treatment of refugees created by Cameron and Blair’s wars. Could, you dear reader, imagine Owen Smith or any of Corbyn’s predecessors post-Michael Foot doing that?

 

All That Is Solid Melts Into Air

By Daniel Margrain

The momentous nature of Jeremy Corbyn’s landslide victory should not be underestimated. It has to go down as one of the most sensational and politically earth shattering events in modern British political history – the impacts of which are sending tremors throughout the entire establishment. After the announcement was made that Corbyn had won, it was obvious that the smiles, handshakes and applause of the vast majority of the calculating and opportunistic labour elite were as a fake as Blair’s claim that Saddam was about to attack Britain within 45 minutes.

A pointer to the overwhelming inspiration underlying Corbynism was the fact that no less than 160,000 volunteers who seemingly emerged out of nowhere, were recruited to the cause. The grass roots support that Corbyn engendered – by far the biggest of its kind in history – was almost certainly the catalyst that propelled him to victory. Although the activists were mainly young people, they were by no means exclusively so. In fact the demographic was wide ranging.

Corbyn’s straight talking, lucidity, and unambiguous commitment to a programme of anti-austerity brought many older activists who had felt betrayed by the direction the party had gone under Blair, back into the fold. To put Corbyn’s victory into context, he secured a higher percentage of votes than Blair got in 1994  Even more significant, the 554,272 votes he achieved was more than double Blair’s, and no less than 76 per cent of them actually voted, a higher percentage turnout than Blair received.

This would indicate that Corbynmania is no flash in the pan, but on the contrary, represents a new optimism that things really can be better given the right circumstances. Decades where nothing happens can all of a sudden transform into the possibility where decades happen all within the blink of an eye. Neoliberal ideology, which for many was perceived to have been fixed and immutable has, with the rise of Corbynism ,the potential to be swept away.

The excitement that surrounds Corbyn in 2015, therefore, marks a more significant change within the labour movement than the superficial controversy of ‘third way’ Blairism in 1994. Blair’s subsequent general election victory in 1997 cemented the ideological coming together of the Red-Tory axis that this writer hopes Corbynism will shatter to the dustbin of history. What is certain is that September 12, 2015 will be remembered as the day in British political history that Blairism officially died.

When Corbyn was first nominated, he was seen by his opponents both inside and outside the party as a joke candidate. But an indication of how they are now taking him seriously is the extent to which the mainstream media are unanimously attacking him. The Tories, who apparently voted for him because they thought it would enhance their future electoral prospects, are the ones now claiming he is a danger to national security.

But the more they attack, the greater is his support. Justice Secretary, Michael Gove, Defence Secretary, Michael Fallon, Prime Minister David Cameron, Chancellor, Gideon Osborne and MP, Priti Patel have all made exactly the same public statements attacking Corbyn. Clearly, all of them have read the same memo issued from Whitehall. The fear mongering and demonizing propaganda, intended for news bulletin soundbites, is so transparent that it’s comical.

The Tories got this tactic from the Republican Party in America who repeat the same propaganda over and over again hoping that some of it sticks which it invariably does. Of course, the media play their part by uncritically reporting it. An example was the way Fox News repeated the lie that President Obama was a Muslim who was born outside of America.

The phrase repeated in the UK media is that “hard-left” Jeremy Corbyn is a danger to the security of our country, economy and every UK family. In the interest of consistency, why don’t the media who describe security-risk, Corbyn as “hard-left”, apply the euphemism “hard-right” to Cameron whose illegal wars greatly increase the risk of domestic terrorist activity? Gove said:

Jeremy Corbyn’s victory is a deadly serious demand from her majesty’s opposition that we put the future of this country in the hands of the MP for Islington North…There can be no room for doubt or ambiguity about what Jeremy Corbyn would do if he formed the next government. He would pose a direct threat to the security of our country, the security of our economy and the security of every family…. He would weaken our defenses and make Britain less safe. By choosing Jeremy Corbyn over his rivals, the party have now endorsed deserting our allies like Norway. He proposes leaving the NATO alliance just as the growing threat from Islamist extremists requires international solidarity.

Or to put it another way, Corbyn wants Britain to stop trailing after America to launch another war that got us into this mess in the first place. Gove continues:

“Corbyn would also reduce our armed forces further unilaterally, scrapping our nuclear deterrent whilst terrorists and state sponsors of terror seek to develop nuclear weapons of their own.”

Just think about that for a moment. In the unlikely event that terrorists get hold of a nuclear weapon, they are not going to put it on the back of a rocket and send it from where they are living because they will be easily detectable from space and consequently we would be able to respond in kind. Terrorists are insane but they are not stupid.

What they are more likely to do is Fed Ex some kind of small device in the hope that it would be undetectable which, therefore, totally mitigates against the effectiveness of a state like Britain to be able to use nuclear weapons as a targeted response.

Gove then goes on to criticise Corbyn for his apparent economic incompetency by suggesting that his policy of printing money would be inflationary, overlooking the fact that his own government flooded the bankers with money. The stated aim was that the banks would lend the money back to us with interest so that they would make more profit. But the bankers went one better than that by using the money to buy shares in their own companies thereby increasing the value of those shares and hence the amount of bonuses they were able to award themselves. Conversely, Corbyn’s stated aim is to give the money to the people as a means of generating growth.

Gove then misquotes Corbyn as saying that the death of Osama Bin Laden was a tragedy. But what Gove failed to mention, was that Corbyn was not describing the death as a tragedy, but the fact that Bin Laden wasn’t put on trial, imprisoned and therefore punished for longer.

Why is Tory economic dogma seen as mainstream, but Corbynism extreme?

Sixty-six years after the foundation of the welfare state, under the current Conservative government, every aspect of it is under attack. The 2012 Health and Social Care Act, for example, will remove the duty on the Secretary of State for Health to provide a comprehensive health service, while the requirement in the act that up to 49 percent of services can be tendered out to “any qualified provider” will rapidly lead to the privatisation of the NHS in England and Wales. Already between a quarter and a half of all community services are now run by Virgin Care [1].

In social care, a combination of cuts of around 30 percent to local authority budgets since 2010, increasingly restrictive eligibility criteria for services, and inadequate personal budgets will leave millions without the support they need and increasingly dependent on the family, and in particular women family members [2].

And in place of what was once called social security, unprecedented cuts across all areas of benefits, especially disability benefits, the introduction of sanctions regimes which have contributed to 500,000 people being forced to use food banks, and a bedroom tax affecting around 600,000 people will increase the number of children living in poverty by 200,000 [3].

All of this has been underpinned by a brutal ideological offensive against people on benefits which explains the reason for the growing rates of sickness benefit claims are for those who suffer from depression and anxiety [4], as well as the increase in the rate of suicide among those on benefits [5].

The ideological attack on the poor is predicated on the governments’ insistence that those able to defend themselves least, pay the costs for a global economic crisis which began in 2008 but was not of their making [6].

Over the last forty years, successive Labour and Tory governments’ have been committed to rolling back the post-war welfare settlement under the guise of debt reduction premised on neoliberalism which involves a change to the function of the state as less ‘welfare provider’ to more ‘pro-business facilitator’.

Many people believe that the neoliberal assault that embody these changes began with the 1979 Thatcher governments’ limited (by today’s standards) publicly-owned asset stripping. But this is a myth. It was actually under the Callaghan administration that preceded Thatcher that the initial structural changes happened  As Colin Leys (p.41) notes:

From 1976 onwards Labour…. became “monetarist”. It’s leaders accepted that full employment could no longer be achieved by government spending but must be sought through private sector growth. For the necessary private investment to take place, prices must reflect real values, and this in turn required “squeezing” inflation out of the system and permitting the free movement of capital. In 1978 Treasury officials began preparing to abolish capital controls

But it is the assault by the trio of Cameron, Duncan Smith and Osborne on, not just the welfare state, but the entire ethos of the public sector in general, that has taken things to a new level. This is demonstrated, in part, by Osborne’s intention to sell off £31bn of public assets in 2015-16. It is clear that the Tories are using austerity and the neoliberal ideology that underpins it, as an excuse to expand the pro-business facilitator model to areas within the public sector that Thatcher could only in her wildest of dreams imagined.

That said, this approach has limits in terms of maximizing utility to capitalists within a modern state. It is precisely this kind of rationale that explains why the former governor of the Bank of England announced that the current situation is “the worst crisis at least since the 1930s” [7].   

As this writer has pointed out previously, even venture capitalists realize that proper welfare provision for those not working as well as a substantial increase in the the minimum wage for those in work, is necessary to prevent the capitalist system that they benefit from collapsing in on itself [8].

In 1943, the Tory MP Quintin Hogg warned that “If you don’t give the people social reform, they will give you social revolution” [9]. This is as relevant today as it was then.

It’s therefore in nobody’s interest that wages are kept depressed and the unemployed and sick are continually made to suffer. The fact they continue to suffer unnecessarily is the reason why a political space has opened up for the likes of Jeremy Corbyn to move into.

Although much of the mainstream media are characterizing Corbyn’s policies as unworkable, misguided and extreme – and seemingly doing everything in their power to undermine and discredit him -, these are nevertheless policies that are, in truth, mainstream and pragmatic. This explains why an increasing number of economists have publicly come out in support of the kinds of economic policies Corbyn articulates [10].

These policies are economically credible, popular with the public and, for most of the world, regarded as mainstream:

In 2009, most of the world was following mainstream economics of the kind that Corbyn is proposing today in undertaking a fiscal stimulus to combat the impact of the financial crisis. But in the UK a certain politician decided to ignore ‘economic credibility’, and instead proposed doing the opposite: what has subsequently become known as austerity [11].

The imposition of 40 years of neoliberal economic dogma pursued by successive Labour and Tory governments’ has failed the people of Britain who rightly, in my view, see Corbyn as the catalyst for change. As time goes on there will be increasing pressure not just from below, but from the top, for the Tories to change course.

As the open letter to the Guardian by over 40 leading economists illustrates, this is already starting to happen. If the government refuse to acknowledge that austerity and neoliberalism have failed, and thus continue to stick rigidly to their failed ideology of cuts and austerity, the British people will eventually elect a figure like Corbyn into power on a mandate to do something about it. That time is coming closer with every passing day.