If you believe some of the crap right-wing bloggers and commentators write, Robert Peston, the chap pictured to the left, is the man responsible for the cataclysm that has engulfed Britain's banking system. The spectre of Marx no longer haunts the nightmares of your average city traders. Instead it is the demonic face of the BBC's business editor that has earned a place in their deepest anxieties. And now, Peston's at it again. At the risk of incurring the displeasure of all those who've grown fat on the neoliberal diet of deregulation and privatisation, Peston has forecast the emergence of a new, 'nicer' capitalism is just around the corner. The question is, can this forecast be justified?
Peston's report starts off with a line up of what the next 12 months are likely to bring. And these are, unsurprisingly, reduced consumer spending, job cuts and a continuation of market volatility. But unlike a run-of-the-mill recession, if that's what you could call the Tory bust of the early 90s, this crisis "will affect the relationship between business and government, between taxpayers and the private sector, between employers and employees, between investors and companies". But, apparently, in a much nicer way.
The debt crisis has knocked the stuffing out of global capital and battered the confidence of the once-invincible Masters of the Universe. And what is more they have no solutions to the predicament. All they have proven capable of doing is to crow ignorantly against the vast bail outs by governments. Against one, albeit hitherto hegemonic section of capital, the likes of Brown and Bush have, by their actions, asserted the interests of capital-in-general. For Peston, "the system's salvation may require it to be kinder, gentler, less divisive, less of a casino where winner takes all".
The new capitalism, propped up as it is by taxpayers' cash, has opened key sectors of the economy to political pressure, and as more firms go cap in hands to government over the short to medium term, this space is likely to widen. As Peston argues, the private sector will have to behave in a way that legitimates the use of public monies. In theory it means more management visibility and accountability, a greater understanding of the problems and anxieties facing employees, and fewer inflated salaries with astronomical bonuses. However, for Peston this should not go hand in hand with a new protectionism, which he believes would reverse the 'gains' of globalisation.
Unfortunately Peston's speculations end there. But where he drops the baton, Jonathan Rutherford and 'left' Labour MP, Jon Cruddas take it up in their latest contribution to Liberal Conspiracy. They argue the crisis and the interventions the government have been forced offer a political opening to the left. They argue for the development of new business models, structures of corporate governance and packages of new regulatory mechanisms that the banks will be subject to prior to their being returned to the private sector. At the centre of their plan is a national strategic investment bank that would be the driver of planned economic development, such as infrastructural and sustainable development, and all this would proceed alongside a process of rebuilding local democratic institutions. In short, what Rutherford and Cruddas offer is a 'new' social democracy for our times.
There are problems though. Rutherford and Cruddas have a vision that does not go far enough. It is even tame by social democratic standards. For example, looking at the experience of the past 30 years, is it really a good idea to return the banks to the private sector? Theirs is a strategy entirely governed by the paradigm of keeping capitalism going, hence the lip service paid to democracy, and then at the margins of their proposals. A socialist strategy would entail nationalising the lot but under the democratic control of those who work and bank there, and also with input from the government. Socialisation and stabilisation are the socialist watchwords.
But Peston, Rutherford and Cruddas are right to identify the existence of a new political space. Social democrats can argue it offers an opportunity to tame the capitalist beast. Socialists could use it as a wedge to argue for more thoroughgoing measures that point beyond commodity production and exploitation. However, at present, there are no significant social forces won to either perspective. Because the labour movement remains at a low ebb and our class is largely unorganised, what is the likelihood of either approach winning out in the battle of ideas in the short term? At the moment Rutherford and Cruddas's ideas are like the strategies of the far left: straws in the wind. However, at least the far left are out there week after week putting their alternatives across to the public. Since New Labour has been gutted of most of its social-democrat aligned activists, who's going to spread their reform-minded gospel?