Thursday 3 July 2014

Inequality and British Capitalism

As we saw the other day, inequality has become so pathological that capitalism could seize up. When lucrative markets are locked down, when governments bow and scrape to big business, when social mobility is choked off, and the unobtainable opulence of the vanishingly few is crassly paraded in front of the many, capitalism is going out of its way to court an existential crisis. Though, of course, there is no one as such to blame for this state of affairs. And that's the most terrifying thing about the system. Capitalism is blind. Market-driven production for profit means our economics are only interested in basic human needs if there's money to be made. It's how hunger in the advanced nations can co-exist with Google Glass. It's how worsening climate change runs alongside the "greenest government ever" making it even easier to allow fracking. Forget the invisible hand - we need to talk about the invisible wrecking-ball. This is why the likes of Nick Hanauer has to pen memos to his fellow plutocrats about inequality, because left to its own devices capitalism will drive itself off a cliff.

What does inequality mean to British politics? Everything. There are many kinds of inequality out there, but in Britain, the world's first capitalist nation, its politics has long reflected the class relations capitalism produces and depends on. The Conservative Party was - and still is - a coalition of land, business and finance. And Labour, basically, a coalition of everyone else. The former represents money made from the labour of others, the latter the labourers who make money for others. So when it comes to the question of inequality, where do the parties sit? How do they address the problem?

Well, the Conservatives do not. We are told the Tories have a long-term economic plan. Dave and co are eager to utter those words at every available opportunity. But do they, really? More on that another time. For now, whether in possession of an economic plan or not, they certainly do not have a programme for addressing inequality. In fact, is it even recognised as a problem? Clearly not. For them, inequality is good. Rip out the social security safety net and you have a mass of people who, of necessity, will queue up for the latest zero hours, minimum-wage offering down the dole office. And this is a good thing. If you're ever fortunate enough to receive a ministerial letter from the DWP, they wax lyrical about the mental a physical health benefits of being in work. Low paid work encourages employees to graft harder, to work their way up the greasy pole. It demands discipline and self-responsibility. Best of all, low wages are attractive to overseas investors. Where else in Western Europe can you find a benign corporate tax regime, excellent transport links to the continent, and an educated work force on the cheap?

Previously, I've mentioned, from the standpoint of British capitalism, how dysfunctional the Tories are. They are, but that's because they pursue the short-termist logic of individual capitals. Every business strives to produce commodities at minimum cost, thereby reducing the risk each commodity represents when it goes on sale and maximising the potential realisation of surplus value (see point nine, here). Examples of how businesses go about this is the introduction of labour-saving technology, IT systems, greater surveillance and supervision of the workplace, forcing through temporary and zero hour working. We could be here all day listing the means by which individual capitals wring every bit of surplus value possible out of their employees. And, of course, they have an interest in keeping the work force as individuated and atomised as possible. Disorganised workers do not challenge management decisions. Disorganised workers accept whatever pay and conditions are thrust upon them. So trade unions, wherever possible, are a no-no. The Tories are basically governing Britain as if it was Amazon or McDonald's. Grind the workers down, pretend there are no long-term structural problems, and celebrate inequality not just as a virtue, but a selling point.

Labour is different. Forget the far left fairytales you might have been patronised with, Labour has always been a party of capitalism. Let me repeat that. Labour has always been a party of capitalism. Yet, because it is a labour party, it has a varied and patchy batting record for the interests of working people. Working people here is everyone who, of necessity, works for a wage or salary in all the possible jobs you can think of. And interests are their particular and general interests as they exist within the system. Also, as a party of labour, it is suffused with the potential to become something more than just a better manager of British capitalism. But more about that another time too. As big business abandoned Labour prior to the 2010 general election, it has become more dependent on affiliated unions and cash raised by party members. The party's circumstances may be reduced, but it is much clearer about the problems British capitalism faces. Look at the emerging party programme. Decentralisation of government, 50p tax, jobs guarantee, attacking land banks, no EU referendum, reversal of NHS marketisation, higher minimum and living wages, ambitious house building programmes - even the maligned training or no benefits for the young unemployed - they slot together as scaffolding around a creaking, tottering capitalism stubbornly stuck in relative decline. Ed Miliband talks an awful lot about inequality, and has even mentioned the S word. This, of course, is not socialism. It's a vision of a managed capitalism different to the 1945-79 Keynesian consensus, but not entirely dissimilar. It's a vision in which inequality is eroded, in which the power of the state breaks capital's collective investment strike, and gives stability and security to millions of people without it.

It is the party not based on capital that can see the general interests of British capital most clearly. Trotsky's theory of permanent revolution is seldom spoken of these days, let alone used intelligently to shine a light on capitalism's guts, but an occasionally useful tool it remains. For those not au fait, it's basically the thesis that nascent capital in colonial or semi-colonial countries were not capable of leading anti-imperialist revolts and developing a national capitalism because their immediate interests were too bound up with those of the occupier's capital. Only proletarian-led forces, which are free of those interests, have the capacity to take power and get development moving. Whether that has been confirmed or refuted by subsequent history need not detain us here. Yet, surprisingly, it has some purchase on the position of social democratic and labour parties in the advanced countries. After the war, as British capital lay exhausted and its bourgeoisie rudderless, in six short years Labour restructured the system. It could not be any other way. The Tories through a million and one ties of friendship and kinship were bound to the old, inefficient and exploitative way of doing things. From an existential stand point, they were incapable acting as Labour did. And so it is the case today. We scorn at the prospect of Dave ever standing up to the hedge funds, the fossil fuel lobby, private health, because they're his mates, his bedfellows, the bedrock of the Tory Party. The Tories cannot enforce the sort of reforms endorsed by Labour because acting in the interests of capital-in-general means going against the interests of the capitals-in-particular they are heavily dependent on. Labour's different social base allows it, compels it to act differently.

With the fall of the Berlin Wall, we've had to endure 25 years of triumphalism, of dog-eat-dog capitalism being the only game in town, of scorn poured on claims of socialism's superiority to capitalism. Yet the historical egg could be on our ideologists' faces. Marx is very clear that socialism is a real movement, a real tendency in really-existing capitalist societies. Trade unions and labour parties are vehicles and incubators of that movement and, in Britain, is the only political force capable of saving British capitalism from itself. What a lovely irony.


Mark said...

So I'd say you're generally right, but I think too optimistic. Most working people consider themselves middle-class or strive to do so, a far-cry from the 1940s; what they need is different to what they say they want. Social groups are not clearly defined and don't we just know how the labour movement has faded away as a result.

Labour's social base, it seems to me, is far more tied to a sort of middle-class humanist philosophy of paternalism with whatever remains of the workers movement than it is to assaulting inequality these days. I don't know. I can see Miliband offering some home remedies but nothing really to inspire mobility/renew social democracy.

Anonymous said...

As Mark said in the previous post - most working people think they are 'middle-class'. This more than anything else is the legacy that Thatcher left the UK. She fooled the people into buying up council houses that they already collectively owned. Much the same with the shares in GAS, BT etc. What she succeeded in doing was conning them into the debt bubble. Add to this the availability of new 90s designed cheap commodities like plasma/LCD TVs mobile phones and everyone believed they had 'increased' their worth and had magically beat the system and were somehow socially climbing out of the working class. If they stopped to look around they would have realised that their neighbours had fallen for the same line and in fact every worker had been convinced they had socially climbed into the middle class. In reality they were still in the same jobs living in the same houses, only now they had a huge debt hanging around their neck. Nonetheless, this fallacy of social mobility made them swallow the debt burden for the false status of being middle class. Of course 'middle-class' shun the idea of rabble rousing unions, so Thatcher scored a double whammy.


Speedy said...

I get the general drift, and the theory, but i feel the details, and the practice, are a bit off.

Let's begin at the beginning - I'm not convinced that those kids rifling bins are starving (although they may well be hungry). Around where I live, they're Romanian gypsies, and that's what they do - and what they've always done. It's a form of recycling.

Because food banks exist, people will use them - here's a sociological conundrum for you. Had they been created at the height of the boom people would have still used them, and we would be "food bank Britain". Of course some people at some times will always be in need of help, but compared to most places in the world (and in Europe) the system of benefits in the UK is still generous. There is no need for people to actually starve.

(Well, seeing as this is the month of saying the unsayable).

Inequality is a false measure - in capitalist societies there will always be inequality. Labour did next to nothing to address this - materialists that they are they just thought giving people more money would "lift them out of poverty". Well, maybe, but many were still on the scrap heap without a sense of hope while Labour encouraged immigration to do the low paid jobs that these people could have been doing, at the same time encouraging easy credit and gambling and going easy on Murdoch etc.

I have worked with some of these families and they're are not starving - obesity and depression are the big problems. A classic quote from one defeated mother of her deliquent son: "I got him a playstation, an xbox, and he still smashes things up."

Labour may want a fairer capitalist society, but it actually aids and abets the worst aspect of capitalism - the lack of social mobility. It consigned a whole class of people to Epsilon-like welfare dependency.

Modern Labour does this out of naivety. It does not understand capitalism. it thinks it can be controlled, manipulated. Because it is run by bright bourgeois types who look perplexedly across the House at the Shire Tory cretins, it thinks it is cleverer than capitalism is. This is a mistake (and not one the '45 government made).

In a capitalist society social mobility is the key. This, New Labour actually managed to reverse.

The people who run Labour see social mobility as a rather bad thing - vulgar. Look at "loadsamoney", chavs, etc. They don't like WHAT IT LOOKS LIKE, because deep down they have a profound bourgeois loathing and fear of the ACTUALITY of the working class.

For much the same reason I sometimes wonder if the Left hates the US - not because it bombs Iraq or whatever but because it (until recently) has been a more socially mobile society where people do not know their place and what is expected of them by their "betters" - those bright bourgeois Leftists.

So I am not convinced that Labour will save capitalism from itself. I think capitalism is getting along quite nicely - it has a long way to go before it "collapses" (look at how everything settled down after the Great Looting, which now seems to have been consigned to a vague memory).

Look at South Africa, look at Brazil - there is far to fall. People won't start getting properly angry until they get really hungry - that is why the government of '45 actually did shit, because people knew what hunger, poverty and fear really meant. New Labour was mainly about anaesthetising this memory.

Organized Rage. said...

"most working people think they are 'middle-class'"


That is simply not true, if you look at all the opinion polls in recent years and over 51% believe they are working class. People having colour TV, etc, or owning their own home has nothing to do with which class we belong to for christ sake. If you go down that road you will be saying we are not working class if we do not keep coal in the bath.

The question of Council House sales is complex. I was against council house sales but who am I to blame any worker if they were in a position to do so who took advantage of the massive discount.

Critics had nothing to say when middle class people took advantage of the tax discount years ago when they brought their homes. To suggest a worker who brought his home is no longer working class is ridiculous.

Government does not chuck wads of cash at working class people that often, now do they? And when they do we can point out the disadvantages but that' all, a blanket condemnation no.

The lack of public housing is not down to the sale of council houses only, but due to both the Tory and Labour governments actively working to do a way with public housing. New Labour were in many ways worse than the Tories as they failed to build new council housing and reduced the discount people got when buying their home (We should not forget many who brought had lived in their home for many years before buying).

NL created the worst of both worlds so to speak.

Indeed the re-Rachmanisation of the housing rental sector is as much the fault of new labour as it is Thatcher and Clegg and Cameron.

Robert said...

@Speedy The idea that foodbanks don't reflect real hunger but are simply a result of people taking advantage of a free good or that our benefits system is generous compared to other West European cuntries is Tory propaganda.

"You cannot just swan in. You get nothing unless a charity or public agency has assessed your need and given you a voucher. The trust is at pains to make sure that the beggars – for hundreds of thousands of beggars is what Britain now has – receive a balanced diet. To feed a couple for five days, it gives: one medium pack of cereal, 80 teabags, a carton of milk, two cans apiece of soup, beans, tomatoes and vegetables, two portions of meat and fish, fruit, rice pudding, sugar, pasta and juice. That this is hardly a feast is confirmed by the short list of "treats", which, "when available", consist of "one bar of chocolate and one jar of jam".

Sharon Cumberbatch, who runs the centre, tells me that she is so worried that shame will deter her potential clients that she packages food in supermarket bags so no one need know its source. The clients, when I met them, reinforced her point that they were not the brazen freeloaders of Tory nightmare. They trembled when they told me how they did not know how they would make it into the new year."

luckys said...

Well, the Conservatives do not. We are told the Tories have a long-term economic plan. Dave and co are eager to utter those words at every available opportunity.
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