Wednesday 16 August 2023

Keir Starmer's Radicalism

Is Labour going to be more radical in office than the image currently projected by Keir Starmer and the shadow cabinet? Yes, if you take this New Statesman headline as good coin. But what counts as radicalism? After all, Tony Blair's period in office, which saw the retrenchment of the Thatcherite settlement under new branding and the continued undermining of Labour's own base was dubbed "radical". Mostly by Blairite loyalists and no one else, but the point remains.

Radical, if it's to mean anything in politics, refers to some a break with the status quo. I.e. The conventions, practices, and ideas that dominate the bourgeois mainstream. But anyone can do that. Boris Johnson's contempt for constitutional niceties and probity would, by this definition, cast him as a radical politician. But this was subordinated to a very conservative aim (self-promotion) with equally conservative outcomes: the continued political dominance of the Conservative Party. Radicalism has to do more than upset: it has to fundamentally threaten the power relationships that structure and are upheld by a political settlement, and does so in a way that opens up opportunities for more democracy. Radicalism is a politics that embraces the potentials of the mass, and looks to invite the demos in. It cannot therefore ever be about replacing one ossified elite structure by another. New Labour then? Very obviously not radical. The "gains" of that period of government, where they were not undercut, raised living standards and made life better for millions of people. But it did not alter the fundamentals.

And according to our Freddie Hayward, our NS scribe, neither will Starmerism. He says that Labour have opted for a "better managers" strategy, and as such have decided to follow political opinion. Which, in practice, has meant not saying much. But we can look forward to a veritable policy blitz this Autumn as per Starmer's five missions. There are announcements due on net zero, economic growth, and plans to cut violent crime. These are the headline grabbers-to-be, but the real radicalism on offer is virtually cost-free: planning regulations, public sector reform, devolution, collective bargaining.

Are these radical? They are certainly different to what the Tories are offering, as well as Labour pre-Corbyn. The change to planning will allow building on the greenbelt, which would increase housing supply and should contain the rise in prices. Except this is what developers have been lobbying for for years. Reforming the public sector suggests making state services work better and be more responsive, but could easily be the Trojan horse for more private sector involvement and reinscribing the state/citizen relationship as provider/customer. I doubt private health and other outsourcing specialists are bunging shadow ministers because they agree with a radical democratic vision of politics. Devolution will see more powers pushed out of Westminster, but this is more consistent with setting up a new regime of accumulation. And the one unalloyed good, the expansion of collective employment rights and bargaining backed by statute itself owes more to managerial imperatives than an endorsement of workers' self-organisation.

What of the other claim Hayward makes? He says that for all Labour's caution on fiscal matters, "you can already picture [Rachel] Reeves standing at the despatch box, brow furrowed, proclaiming that action is required because the situation is worse than she understood." Can you? This is exceedingly unlikely, because she routinely defers to Bank of England orthodoxy. Be it on the causes of inflation and how it should be dealt with, her understanding of state finances, attitude to social security recipients, and suspicious attitude toward spending money, all come with a whiff of City consensus about them. Just because something is broken and it's necessary to fix it doesn't mean a government will cleave to this necessity. As the lessons of this very Tory government teaches us week in, week out. But supposing Reeves, faced with collapsing public services, does act. The options are borrowing more or taxing more. Closing tax loopholes, equalising capital gains and income tax rates, and upping the higher bands to address the NHS and teacher retention crises would be welcome. Chances are it would be very popular, but it's not radical.

Here's where we get to the nub of the matter. Labourism, apart from the programme the party had between 2015 and 2019, has never been radical. It is an ameliorative project, the political expression of a workers' movement that has long been integrated into the UK's constitutional order. It is circumspect and loyal, and is intellectually impoverished and intellectually elitist at the same time. The shock of Starmerism isn't that it abandoned Labour's radical tradition, but has rather forcibly returned the party to the historical mean. Starmer's politics does not break with Labourism, it's a rude instantiation as authentic to its tradition as any of its predecessors in government. If there is a radicalism here, it's the stark way Starmerism is presenting Labourism's true face to the public's gaze.

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9 comments:

Dipper said...

Well yes, it does look like Starmer will stick to technocratic centrism.

The promise of technocracy is that skilled and wise professional people act out of a sense of apolitical best interest to implement polices that are best for the country and not ones driven by partisan short-term political expediency.

There are three problems with this.

Firstly, technocracy doesn't work. Politics takes place in a multi-parameter inter-active poorly understood environment in which predicting the outcome of political actions is extremely hard. It is, in effect, the wrong skill set. It doesn't work, and is hopeless at dealing with the multitude of issues that arise.

Secondly, Technocrats are themselves a class. They have a class interest, and are not impartial. Hence their policies inevitably priorities whatever keeps them as a class in power and rewarded.

Thirdly, they have shown with the Trans issue and Critical Race theory that they are open to capture by determined forces, and having been captured are impervious to any political control.

So any attempt to stick technocracy front and centre is likely to create more problems than it solves. I remain to be convinced that Starmer/Reeves have the political skill and will to handle the inevitable storms that will come their way.

Zoltan Jorovic said...

"The change to planning will allow building on the greenbelt, which would increase housing supply and should contain the rise in prices."

There are a number of false assumptions here.
1. That housing supply is ‘constrained’ by the green belt
2. That housing supply is ‘constrained’ by planning
3. That housing supply being ‘constrained’ is what drives prices
5. That new housing could be increased so as to drive prices down

I put constrained in quotes because this word holds a host of meanings and carries a huge load of assumptions in itself. The supply of housing is greater than the number of households (30 million vs 28 million), so it could be argued that there is no constraint. Rather, the problem is that the financial resources necessary to purchase a house are not evenly distributed.

The whole argument reveals a naive and simplistic view of the economics of house prices. It assumes a simple intersection of supply and demand curves where an increase in supply causes a commensurate fall in prices and vice versa. In reality no such simple relationship exists, for this, or, probably, any other commodity. Conventional neoclassical theory argues that demand falls as the price rises. This is clearly not true for housing, as the demand remains high despite prices being out of reach for many. But, conversely, as prices fall, so should demand rise. So, if building on the green belt pushed prices down, it should push demand up. Demand here is not synonymous with need. As prices dropped, those with the means would be more inclined to buy – given the extreme range in income and wealth, it is highly unlikely that this would touch those sectors of our society who currently struggle to afford a house. In other words, it would mean more buy-to-let, buy to accrue and buy to indulge (i.e. second or more homes) from those with the wealth.

I could go on. The truth is that new builds represent a small fraction of housing. There are approximately 30 million dwelling in the UK, and around 300,000 new dwellings are built annually - so about 1%.
Lets say allowing building on the green belt pushes this up to 360,000 this would mean 1.2%, so an increase of 0.2%. Would this affect prices? Doubtful.
Lets say they were to build twice this number - 600K. The highest number ever built in any one year (1968) was 425k. There are not enough skilled tradesmen to achieve a doubling in new builds, even were the sites available and building companies inclined to try. It's just fantasy.
Even were it possible, is supply per se the problem? Or is it supply of the right type of dwelling, at the right price in the right place?
Would removing the Green Belt and declaring open season for builders on all the land that includes deliver houses that are affordable for those who most need them? Or would the developers have to pay top whack for that now suddenly hugely more valuable land, and so need to charge high prices, and so build “executive” or “luxury” houses? You know the answer.
Those who can’t afford a house now, would still not be able to afford one. House prices might stabilise, or even drop a bit, but with interest rates as they are, monthly mortgage payments would remain beyond the reach of those that can’t afford them today.
Meanwhile, the blow back from all the people who living near the de-greened belt would be intense.
The only beneficiaries would be the land owners, the developers, the wealthy, and whichever party promised to restore the Green belt.

Planning is not the reason that house prices are unaffordable. Nor is the number of new builds a significant factor. 2 million more dwellings exist than households. That should tell you something. The problem is inequality, and market fundamentalism If it is left to the ‘market’, there are enough people who can afford two or more ‘homes’ to ensure that demand outstrips supply at any realistic level of new builds.

Zoltan Jorovic said...

@Dipper hits the nail on the head when he says that "predicting the outcome of political actions is extremely hard" and that Technocrats have "the wrong skill set". Unfortunately, it would seem that nobody possesses the necessary skill set to run the country well.

Perhaps then, the problem is not that the people elected are the wrong people, but that the premise of running a complex system like a nation using elected representatives, chosen fairly arbitrarily every 5 years using an archaic FPTP election simply doesn't work well. Representative Democracy, as we have it, and effective government (where effective means delivering a decent standard of living and level of well being to all its citizens sustainably) are not compatible.

Maybe we should accept that the country will be run less than optimally, provided it is run in a way that does not clearly favour a certain interest group at the expense of the rest. We need, therefore, to democratically devise a measurement, monitoring and control system to ensure the government delivers a decent standard of living and level of well being sustainably to all its citizens. One that holds them to this and is resistant to capture by interest groups. Something better than having a vote every 5 or so years.

Blissex said...

«Labourism [...] the political expression of a workers' movement that has long been integrated into the UK's constitutional order. It is circumspect and loyal, and is intellectually impoverished and intellectually elitist at the same time. [...] Starmerism is presenting Labourism's true face to the public's gaze»

I remained astonished that our blogger has the power of imagination to state that Starmerism is the "the political expression of a workers' movement", when the claimed core constituency of Starmer is individual kipper thatcherite property owners, not workers, never mind a movement of workers. Much the same as the "Sierra man" constituency of Blair.

Labourism to me was the "butskellism" period of Labour, the conformist "pink" postwar consensus, something way to the left of Starmer's kipper thatcherism.

«it does look like Starmer will stick to technocratic centrism»

Where "centrism" is just an euphemism for "globalist thatcherism plus identity politics" and technocracy is a core value of globalist thatcherism.

https://www.jwz.org/blog/2019/11/centrist/

Blissex said...

«The supply of housing is greater than the number of households (30 million vs 28 million), so it could be argued that there is no constraint. Rather, the problem is that the financial resources necessary to purchase a house are not evenly distributed.»

Rather as several books argue the problem is that there is an excess of jobs where there is a scarcity of housing, and viceversa. This map shows the situation very clearly:

https://loveincstatic.blob.core.windows.net/lovemoney/House_prices_real_terms_lovemoney.jpg
https://www.lovemoney.com/news/53528/property-house-price-value-real-terms-2005-2015-uk-regions

This disparity has been the main goal of UK government policy for 40 years: push the "losers" to emigrate out of areas with cheap housing by heavily subsidising jobs in areas where housing is scarce and owned by "winners", for example:

https://earth.google.com/web/search/oxford/@51.75291175,-1.23776218,67.30389414a,6933.505051d,35y,59.63985276h,59.98365871t,359.99999879r/data=CigiJgokCX4cEq18pjdAEX4cEq18pjfAGeCX3k-e2kVAIYGHhhbqUU_A

where a cheap 2-up-2-down goes for £500,000-1,500,000, and it is a low density town where development is heavily discouraged to keep prices high. As Von Th√ľnen argued 200 years ago land price is usually proportional to wages.

Astute property speculators buy in areas where the ratio between vacancy growth and housing growth is rising.

Astute speculators also know that demand and supply of housing is far more flexible than some people think because of doubling up/halving down: when prices rise more people share dwellings or even rooms or even beds, and viceversa.
Actually because housing largely exists in relation to the job market, demand and supply should be measured in bed-days, not in house-units.

«Conventional neoclassical theory argues that demand falls as the price rises. This is clearly not true for housing, as the demand remains high despite prices being out of reach for many.»

The prices of housing units may remain out of reach, but the prices of bed-days can be falling as more people double-up. When a bedroom occupied by 2 people gets bunk beds, and takes 4 people, it can satisfy twice the demand at the same price (actually at a higher price).

«But, conversely, as prices fall, so should demand rise. So, if building on the green belt pushed prices down, it should push demand up.»

Neoclassical theory for all its ridiculous assumptions and inconsistencies has however the concept of *notional* demand and supply, that is demand and supply around the "equilibrium" point, which shifts as the demand and supply of bed-days expands or contracts even if housing units remain constant.

Blissex said...

«Demand here is not synonymous with need.»

Neither it is for food or clothes... But the peculiar aspect of housing (in the south-east) is that it is not only needed for survival like food or clothes, it is not just a necessary cost, but it also a gateway to jobs and wages.

«As prices dropped [...] would mean more buy-to-let, buy to accrue and buy to indulge (i.e. second or more homes) from those with the wealth.»

So except for "buy to indulge" the supply of bed-days would increase.

«around 300,000 new dwellings are built annually - so about 1%. Lets say allowing building on the green belt pushes this up to 360,000 this would mean 1.2%, so an increase of 0.2%. Would this affect prices? Doubtful.»

That's an increase in supply of 20%, 0.2% is the increase in percent-points.
That might provoke a collapse in house prices, so it is never going to happen.

The collapse would happen because house pricing has some particular characteristics that make it non-linear:

* Prices are largely set by the *marginal* buyer of bed-days. A 20% expansion of supply would involve more competition at the margin for buyers and tenants and this would reduce rents and prices in the whole affected areas.

* Housing is often bought on margin and often purely to make a capital gain or profit from rising rents. If prices or rents stall a property becomes a waste of capital and a risk of leverage capital losses, and many will sell as fast as they can to reinvest their capital into something better.

There is also the side point that most of the new building would happen in areas with many jobs, so that 20% national average supply increase might result in a much bigger supply increase in areas with housing scarcity like much of the south-east.

Blissex said...

«The problem is inequality, and market fundamentalism If it is left to the ‘market’, there are enough people who can afford two or more ‘homes’ to ensure that demand outstrips supply at any realistic level of new builds.»

The problem is the political necessity to buy support for the policies that benefit the upper class with policies of massive intervention in the markets to benefit the middle classes at the expense of the working class and the under class, and booming south-east property prices and rents have done that for 40 years; with the added advantage that the upper class too benefit from redistribution from the lower class via property, perhaps even more than the middle classes benefit.

Without being more than compensate with massive property gains and rents the middle class would not have supported the thatcherite/blairite shrinking of wages, pension, social insurance, public services.

And that's why Starmer and the Mandelson Tendency thatcherites are so keen on chasing the votes of affluent property owners.

Blissex said...

«nobody possesses the necessary skill set to run the country well. [...] democratically devise a measurement, monitoring and control system to ensure the government delivers effective government (where effective means delivering a decent standard of living and level of well being to all its citizens sustainably)»

Ah the eternal yearning for the abolition of politics and its replacement by "technocratic centrism" including KPIs. "New Public Management"!

Zoltan Jorovic said...

@Blissex You completely missed the point I was making and instead read into it the opposite! I wasn't asking for politics to be abolished but for it to be reformed. Unless you believe that it is working well for the vast majority of people?

Reform here means updating the electoral system so it reflects the actual voting preferences of the people who bother to vote. It also means replacing the House of Lords with something at least vaguely democratic. Much stricter controls on funding - ideally so that there is a per person limit and no corporate, oligarch or trust-fund buying of influence. And, some means of monitoring MPs to stop the abusive practices of those who ride the gravy train to lucrative Directorships and serve funder interests rather than the interests of constituents. That would do as a start.

If people then still insist on voting for the likes of Rees Mogg and Dorries and sundry other self-servers then I will accept that there is no hope and we all might as well give up and if we have the means, buy ourselves several homes to live as rentiers while the world collapses and dies.