If capitalism survives this crash one thing is certain. The corporate classes will again lobby for the same rules that brought us here. History will be rewritten and it won’t be the unregulated market to blame but the remnants of government intervention. As always with the monetarist religion all errors boil down to the same failing – we didn’t believe hard enough. Again we will be assured that the only root to freedom and economic security is through the economic free-for-all.
Resisting this resurgence will not be easy, any more than last time. The bitter fact is that wealth usually has the power to usurp truth. While it is plain as day that privatisation and deregulation have been disastrous for democracy, liberty and security, the elites that benefit have much louder voices than those who suffer. Monetarist ideology is 99% lies, but its advocates are well connected and have endless resources at their disposal.
The other problem is the remaining 1% - the grain of monetarism that is true. The rational kernel of free-market ideology may be minuscule in comparison to the propaganda that hangs off it, but its logic is potent and appealing. Those who wish to prevent free-market madness from returning would do well to understand that logic.
99% Lies
The first point is plain enough. While monetarism is sold to us as freedom it is in fact a strategy to neuter democracy. All the talk of liberty and free competition is propaganda. The real objective is to keep politics and economics out of the hands of the citizenry and in the hands of the super rich – and it’s worked a treat.
It is bitterly comical to recall that Thatcher won power in 1979 as the champion of the small business. Thirty years on and every high street is reduced to the same cluster of national or global chains. Thirty years of ‘free competition’ culminates in us all being fed by four supermarkets; independent butchers, bakers and greengrocers outnumbered by homeopaths and palmists.
The monetarist might argue, well that’s the free market. There was a fair contest and these four won. But of course the competition never was fair. Obviously those with huge cash reserves can buy and sell cheaper, and bankrupt smaller competitors. But this shows no talent in business only a talent for ruthlessness. And the end results are the antithesis of freedom and competition.
If the consequence of a competition is four indistinguishable businesses and no real choice then clearly there was something wrong with the rules of the game. Any government truly interested in the benefits of the free market would break these behemoths up and run the competition again, with rules to protect the smaller retailers from such vast accumulations of capital (that’s any government truly interested in the benefits of the free market.....)
Similarly the privatisation of public utilities was nothing but corporate theft of public property. Such a grand heist required a thick smokescreen. The propaganda version was that this was a democratic extension of share ownership. A portion of shares were sold, undervalue, to the general public. Those lucky enough to afford a few then saw the share price rise sharply and so sold them on – to the usual suspects. So a tidy profit for those members of the public who already had a few quid handy, and a swift transfer of ownership and control to unaccountable multinational corporations. If you see Sid, tell him.
Similarly, how can a market be free when some of the competitors are lobbying government or bribing government, or actually serve in government? Corporate propaganda, or as it re-branded itself, ‘Public Relations’ is an immense industry with tentacles in every corner of business and politics. No string is left un-pulled to ensure wealth stays with the wealthy, and that democracy never poses a threat to profit.
The central plank of monetarism is that government should keep out of business. For this to have any useful meaning the opposite must also be true – business must keep out of government. Politics cannot be democratic when wealth is allowed to skew opinion and skew elections. A market cannot be free when ministers awarding contracts end up on the boards of the companies that win them. (For the whole horrific history of back-scratchers, businessmen, lobbyists and politicians see Miller and Dinan’s A Century of Spin.)
Finally, the lies that triggered the current crisis, a deceit transparent enough for a child to see through: It doesn’t matter how bad your credit record because property prices just go up and up indefinitely. And no one ever loses their job. What can possibly go wrong?
How ever did such lies and idiocy become the orthodoxy? It all comes down to self-interest, self-delusion, and a wilfully naïve interpretation of ‘laissez-faire’. This monetarist slogan roughly translates to ‘let do’, specifically, ‘let the economy do’; let business run itself, with minimal state intervention. Monetarists argue that this is the key to prosperity and security, and indeed the only way to protect individual liberty.
The validity of this belief will be the subject of part-two. To finish here, it can be seen that the lies and chaos of the past thirty years can be traced back to this naïve interpretation. To mix the Frenchisms, ‘laissez-faire economics’ was translated as ‘carte-blanche for capitalists’. Everything for sale to the highest bidder. From bin-collection to building societies, the only relevant qualification to own or run anything was money.
And should anyone query this wisdom a reflex answer was to hand: Stop interfering. The market will provide. Anything else will lead to low productivity, un-competitiveness, perhaps even lead to another Stalin or Hitler.
Although the lie was vacuous and transparent, as long as enough of the right sorts of people were doing well out of it there was nothing to stop it spreading. To the last minute government and media were still nosing it along. As calamity loomed dissenting voices were still labeled heretical, part of any problem, snuffed out.
Only when the banks failed did the expressions change. Brows once fixed in certainty now feigned surprise: Who would have thought unrestrained corporate slash-and-burn could result in economic disaster?
Overnight, heresy became necessity. Suddenly it was fine for governments to intervene in business, essential in fact. All talk turned to checks, balances, interventions and bailouts.
The monetarist ‘consensus’ was just a confidence trick. The scam held as long the economy could bear it, but the game is well and truly up. The artists and their shills are laughing on the beach. The mugs, the great mass of us, prepare to meet the costs in tax, employment, housing, public services, health, hunger, warfare, ecological breakdown and a swathe of other uncertainties.
The free market promised wealth, security, and liberty and then led us to the abyss. But all will be forgotten should the economy ever recover. We’ve been here before, after all. Monetarism will re-emerge, probably under a different name, but making the same demands. It will be advocated by the same self-interested parties and have the same financial backing. That’s the self-generating power of privatisation. It makes some people very rich. They can then use those riches to campaign for more privatisation.
Nevertheless there’s one weapon in the free-marketeers arsenal with more to it than wealth and power. Mention of it is likely to prompt more cries of heresy, this time from the left. It’s the 1% of monetarist ideology that is merits examination, and that’s the subject of part two.
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