Thatcher’s economics has generated ‘poverty in the midst of plenty’

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By Prue Plumridge

Lord Wolfson, chief of the Next retail chain said recently that the national living wage could drive up inflation as the retailer would have to raise prices to offset the cost of the new minimum wage of £7.20.

The word ‘living wage’ (which £7.20 is not) clearly strikes fear into the hearts of rich businessmen.   The business mantra is that paying people a decent wage can only lead to the bogeyman of inflation or job losses and is the usual stick with which the workforce is beaten to keep it fearful and compliant.

Let’s first put a context onto this claim by Lord Wolfson.  According to Professor Bill Mitchell, Wolfson claimed that a living wage of £6.70 was ‘enough to live on’ and a ‘decent amount for a lot of his staff”.  He also said that it was not necessary for Next to raise wages because ‘the clothing chain had 30 applicants for every job advertised’.  Professor Mitchell went on to note the salary and benefit arrangements for Wolfson who had a base pay of £743,000 in 2014/15 along with a range of other benefits and bonuses which brought his salary to a total of £4,666,000.

A report published by Citizens UK recently noted that:

‘An estimated 5.24 million people in the UK are employed on less than the living wage. Many low-waged workers are in receipt of benefits and tax credits, policy tools used to top up their incomes [and are] criticised in popular media and policy circles.

The calculation of the public subsidy is a new way to think about low pay.  In effect it is low paying employers who are subsidised by state payments to their employees without which they would be unable to meet their basic needs and continue to work for low wages.’ 

In other words this is nothing more than corporate welfare on a grand scale which costs the tax payer a gigantic £11bn a year.  To put this into context benefit fraud is £1bn. Companies, in effect, have no incentive at all to pay decent wages when they know for certain that the State will (for now) pick up the tab through benefit payments.

To understand claims that increasing the minimum wage will lead to an inflationary loop or job losses we first have to understand from where this idea originated.  The post war period between 1948 and 1973 was known as the Golden Age.  Production had increased, there was full employment and living standards had risen.  In the words of Harold Macmillan in 1957 ‘most of our people have never had it so good.’  During this period before the attack on fiscal deficits occurred across the advanced world inequality was lower than it ever had been, workers were more upwardly mobile and GDP was averaging much higher growth.  The country was riding high on the post-war economic boom which had also seen the foundation of the National Health Service, a social security system and education for all and all despite the so called ‘National Debt’.

This was, in fact, the classic era of Keynesian economics which served as the standard economic model in the latter half of the 1930s and the post second-world war years.   Keynes’ theory was that problems such as unemployment were nothing to do with moral shortcomings but were more to do with imbalances in demand and the point at which a country was in its economic cycle – expanding or contracting.  As such he believed that at times of economic downturn when an economy could no longer sustain full employment government should step in to ensure that resources were fully utilised.  To this effect government spending, he believed, should be used to increase overall demand which, in turn, would increase economic activity and reduce unemployment.  It challenged the reigning laissez-faire model which had its roots in the Classical economic theories of 18th century thinkers like Adam Smith and David Ricardo who believed that markets worked better without government interference.

The 1973-74 recession changed all that.  The certainties of the golden age were to be challenged as unemployment rose and prices spiralled.  The trigger for this was the OPEC oil price crises in 1973 and 1979.   Inflation combined with recession was a new phenomenon and, as it turned out, proved to be the crucible for what is known today as neoliberalism.  The ideas of such economists and thinkers as Friedrich Hayek and Milton Friedman came into their own and quickly began to take root.  By the end of the 1970s, it dominated economic thinking amongst the educated elite in universities and the political and business world.

The study of economics was elevated to that of a science in the belief that through the use of modelling and formulae the future could be predicted accurately and the full employment agenda of the post war years, government intervention and market regulation was abandoned in favour of the magic of market forces.  Such interventions, it was believed, would cause inflation or result in increased unemployment through destabilising the market process which, naturally, sought to find its equilibrium.

Karl Polanyi, who explained the deficiencies of a self-regulating market and the potential dire social consequences of unfettered market capitalism in his book ‘The Great Transformation’ predicted:

‘To allow the market mechanism to be sole director of the fate of human beings and their natural environment…. would result in the demolition of society.’

From the 70’s onwards we start to see a shift in economic thinking which can be summed up in a speech by Prime Minster James Callaghan who told the Labour Party conference in 1976:

“We used to think that you could spend your way out of a recession and increase employment by cutting taxes and boosting government spending.  I tell you in all candour that that option no longer exists, and in so far as it ever did exist, it only worked on each occasion since the war by injecting a bigger dose of inflation into the economy, followed by a higher level of unemployment as the next step.” 

Margaret Thatcher came to power in 1979 and she fully embraced the expansion of neoliberal ideas through government policies.  Her aim was to break with the post war political consensus and pursue policies which deregulated financial markets, rolled back the state through privatisation of publically owned assets and weakened welfare support, undermined union and employment protection and abandoned full employment goals.  The results were that the bargaining power of workers was seriously undermined.  By the mid-80s unemployment had trebled and there was widening income inequality.  Margaret Thatcher who said ‘It is our job to glory in inequality’ laid the foundations for the growing perception that the individual controlled his or her own fate.  On that basis, poverty was a result of one’s own shortcomings and not a failed social system.

Tony Blair’s Third Way attempted to humanise the market by reconciling traditional left of centre values with laissez-faire capitalism.  However, it still accepted the neoliberal doctrines linked to income distribution and the idea that there was a natural rate of employment which was determined by supply and demand.

As Professor Bill Mitchell commented recently:

“They preached equity yet watched income and wealth inequality rise under their stewardship.”

As part of this new Third Way approach, a minimum wage was introduced in 1999 by the Blair government.  However, whilst it was seen as one of the best achievements of New Labour and didn’t lead to the predicted job losses and increased costs the truth was that it was set at too low a level to have any real impact on people’s lives.   What is more, although unemployment fell during its first two terms in power overall, it did increase and the lowest unemployment rate it achieved was still more than 1% higher than in the early 1970s.  This combined with the fact that the low public investment as a share of GDP, which began under Thatcher, largely continued under New Labour and the effects of weakened bargaining power and wage stagnation further increased pressures on the working population.  Furthermore, Blair’s human face of neoliberalism was betrayed by a step change in attitudes to welfare when the Blair government moved to cut single-parent benefits in 1997 and tried to introduce cuts to disability benefits in 1999.  This culminated in 2008 with James Purnell’s Welfare Reform Paper under which everyone would have to do something in return for their welfare payments.  Tony Blair also boasted that the UK had ‘the most flexible labour market in Europe’ but we shall see shortly at whose expense.

When the Conservatives returned to power in 2010, the framework was virtually in place for a full scale assault on the public sector and workers’ rights.  Workfare forced claimants to work for nothing but their benefits under the guise of work experience and training and Tony Blair’s flexible labour market literally found themselves on an even faster race to the bottom.  Temporary contracts, zero hours and low paid work have all facilitated the normalisation of a flexible labour market which is a trademark of neoliberal economics.  In addition, as part of their goal to reduce public spending, the Conservatives also introduced high fees for employment tribunals which has led to a noticeable reduction in claims, clearly at the expense of working people’s rights.

In May 2015, the Tories were re-elected and in only a few months we have seen yet more attacks on Trade unions and working people’s rights and benefits.

Caroline Lucas summed up the last four decades in an article in the Independent:

‘The economic project that has dominated politics since the 1970s has had at its heart the strangulation of the Trade Unions. Why? Because it is the unions which stand as a last line of defence against repeated Government attempts to privatise, deregulate and cut back on the public services upon which we all rely.

The results of that economic project – skyrocketing inequality, the loss of thousands of public sector jobs and increasingly precarious work for many – are plain to see. For more than 30 years, successive Governments have sold off our national assets and deregulated our economy – but to continue the project the Conservatives know they need to remove a key barrier to change: the remaining power of the millions of members of Britain’s trade unions.’

One of the premises of neoliberal thought is that wealth trickles down as a result of markets having the freedom to act without government interference.  We have not found this promised market equilibrium.  What we have seen instead is wealth pouring into the hands of fewer and fewer people.  Unemployment, underemployment and low wages have become a scourge in our society as they disempower people and dispossess them of dignity and the means to ensure their well-being.  Market competition and globalisation have spurred a race to the bottom by allowing companies to suppress real wage growth and accept unemployment as part of the price we have to pay for reaching the promised-land.

So this bring us back to the start of the story.  We have nearly 2 million unemployed people but the real picture is of many more millions who are underemployed, on low incomes and temporary and zero hours contracts having no job security at all and facing the prospect of reduced income support from the State.  Ninety percent of the McDonald’s chain work on zero hours contracts – that’s 82,800 people, Sports Direct employ 20,000 and J D Weatherspoon 24,000 on such contracts.  The employers’ justification for such working arrangements is that it makes Britain more competitive in a harsh economic climate.  Compare that assertion to an increasingly unequal income distribution in which those at the top benefit at the expense of those at the bottom.  Remember Lord Wolfson’s salary last year.

With high unemployment, companies have no trouble finding people to work at the prevailing wage rates.  And yet, whilst profits and bonuses increase, the price for market competition and globalisation is being paid by those least able to ride the waves of economic uncertainty.

Michal Kalecki in his work ‘Political Aspects of Full Employment’ posits a number of reasons why industrial leaders are opposed to full employment.  Although it was written in 1943, his propositions seem as true today as when he wrote it.  Business leaders were, he said, averse to government interference in employment matters, feared losing control of government policy, loathed the idea of public investment and disliked the idea of publically funded welfare.

In 1943 the Times editorial explained why full employment was not a good idea. It said:

Unemployment is not a mere accidental blemish in a private enterprise economy. On the contrary it is a part of the essential mechanism of the system, and has a definite function to fulfil.  The first function of unemployment which has always existed in open or disguised form is to maintain the authority of master over man.  The master has normally been in a position to say if you do not want the job there are plenty of others who do.  When the man can say if you do not want to employ me there are plenty of others who will the situation is radically altered.’

As Kalecki describes it very succinctly:
“For here a moral principle of the highest importance is at stake.  The fundamentals of capitalist ethics require that ‘you shall earn your bread in sweat’ — unless you happen to have private means.”

The Golden Age, for a short period of time, challenged the status quo and the power of big business to dictate terms but since that time the ascendance of neoliberal thought has restored the balance in favour employers and has been supported by ever more government legislation to undermine working people’s rights.  As Lord Wolfson’s assertion indicates, they now have considerable control over the labour market and wages and people have become mere pawns in a global game to be exploited in the name of profit.  The cost to the economy and society of unemployment and underemployment is huge in terms of the outcomes on health and well-being and as a consequence on society as a whole.

So how can this imbalance be best addressed? Jeremy Corbyn stood on a platform of anti-austerity and has promised a radical programme. This will require first that he and his Chancellor wholly reject the neoliberal framework of deficit reduction and balanced budgets. These two positions are irreconcilable. Secondly we need to address urgently the issue of unemployment. In the words of Hyman Minsky in his book ‘Ending Poverty: Jobs, not welfare.

they involve a commitment to the maintenance of … full employment and the adjustment of institutions, so that the gains from full employment are not offset by undue inflation and the perpetuation of obsolete practices.’

So what would this mean in practice?

Philip Pilkington in an article published in the Guardian in 2013 summed it up very neatly with reference to the work of Hyman Minsky:

“Minsky’s theories of financial instability suggested that capitalist economies were prone to serious downturns in which huge amounts of the labour force would find themselves unemployed. What’s more, this would lead to large shortfalls in demand for goods and services which would further exacerbate such downturns. The result was a vicious circle that would become worse and worse as the financial system evolved into an increasingly fragile entity and households and businesses became increasingly mired in debt. The only way out of this was to build robust institutions that insulated working people from the excesses of the system. While progressive taxation and unemployment benefits went some way toward both protecting workers and propping up demand during downturns, it did not, according to Minsky and his followers, go nearly far enough. They believed that governments should offer a job to anyone willing and able to work and then pay for these jobs by engaging in increased deficit spending – as they currently do with unemployment benefits during downturns.

We have a capitalist system which, in fact, has generated ‘poverty in the midst of plenty’.   Poverty, rather than as suggested being the result of the shortcomings of the individual is, in reality, the consequence of unemployment, underemployment and low pay. The primary objectives of government, therefore, should be to ensure that working people are paid a wage which is sufficient and gives them dignity, and the provision of a job guarantee for all those who want to work.  This should be supported by an adequate welfare system to help those who are physically or mentally unable to work through illness or other misfortune.

Those who, like Mark Carney, decried Jeremy Corbyn’s economic plans for PQE by saying it would imperil the recovery, drive up inflation and hurt the poor and the elderly are in denial and should question the very basis upon which they construct their economic assumptions.   Firstly today’s global economy is suffering from deflationary pressures rather than inflationary and even a Governor of the Bank of England should know that some inflation is beneficial.  And secondly, the economic paradigm which advocates austerity, deficit reduction and balanced budgets is bogus and has been for over 40 years.  It has been used to justify the creation of a small state on the false basis that the private sector is more efficient.

We should understand as L Randall Wray said in his introduction to Hyman Minsky’s book that:

‘…. the primary barrier to attaining and sustaining tight full employment is political will’.

The Universal Declaration of Human Rights states: “Everyone has the right to work, to free choice of employment, to just and favourable conditions of work and to protection against unemployment. 
The neoliberal paradigm is foundering but those supporting it will not give up without a struggle since so much is at stake. There is an alternative and with Jeremy Corbyn we now have a mandate to take the ‘road less travelled’ to secure the necessary changes which will rebalance the economy in favour of a fairer distribution of available resources and income.

Our next step must challenge the status quo by understanding how we can best implement that alternative and build the mass movement we need to make change happen.

References:

http://www.mirror.co.uk/news/business/next-boss-warns-living-wage-6421023

http://ineteconomics.org/ideas-papers/interviews-talks/demystifying-modern-monetary-theory

www.guardian.co.uk/commentisfree/2013/jun/07/labour-jobs-guarantee#sthash.ikqwo08O.dpuf

Ending Poverty: Jobs not welfare: Hyman Minsky

Political Aspects of Full Employment: Michal Kalecki

http://www.theweek.co.uk/business/54485/zero-hours-contracts-mcdonalds-flexible-or-exploitative

Rejecting the TINA Mantra and the second ‘gilded age’ http://bilbo.economicoutlook.net/blog/?p=31888

Jeremy Corbyn’s new politics must not include not lying about fiscal deficits http://bilbo.economicoutlook.net/blog/?p=31888

A short history of neoliberalism

http://www.globalexchange.org/resources/econ101/neoliberalismhist

From Keynsianism to Neoliberalism: Shifting paradigms in Economics

http://fpif.org/from_keynesianism_to_neoliberalism_shifting_paradigms_in_economics/

http://www.marxist.com/neoliberalism-dead-or-sleeping.htm

Politics in the Pub Your Rights 2 Work

https://www.youtube.com/watch?v=pS7AOaYY6Lo

Published on Sep 4, 2015

Dr Victor Quirk of CofFEE (Centre of Full Employment and Equity) outlines the history of employment policy in Australia, tracing it from the 1940’s policy of full employment and questions why it’s no longer Government policy.

The Myth of Thatcherism/Reaganomics: Keynes vs Greenspan

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The Myth of the Great Moderation: Keynes vs Greenspan

by Haiku Charlatan

Why I’m Lighting a Candle to the Many

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Tonight I will light a candle to the many

Contribution from Suzanne Kelsey

Hat tip
Prue Plumridge

I appreciate there will always be huge differences of opinion regarding politics and there will be many thousands of people who have attended Margaret Thatcher’s funeral and I am not affected by this. (although I do take offence at the obscene amount of money it is costing during a time of severe austerity) Also many thousands will have watched it at home caught up in the pomp, circumstance and emotion of the occasion, that is obviously their right just as it is my right not to watch it. I cannot be a hypocrite unlike some of her own party who actually stabbed her in the back, which resulted in a very undignified exit from no.10 in 1990.

Therefore I do hope in the same way people will not take offence if I in my own way reminisce on why I do not think Margaret Thatcher left this country in a better state and show my respect to all those who suffered and continue to do so due to the extreme ideologies surrounding Thatcherism. Her death sad as it is for her family, friends and admirers for me has been a salient reminder of how it all started to go wrong and brought to my attention the major difference between compassionate politics and conviction politics.

Clement Attlee and Aneurin Bevan have long been my heroes; they did so much for the working class people of this country that was in desperate straits after two world wars and the great class divide.

Atlee , or Thatcher n

Attlee introduced the welfare state and the NHS, got rid of the horrendous workhouse ethos and made life bearable for countless millions, not just the privileged few, giving them the right to a decent life, equality, freedom from fear and last but not least aspirations. Bevan was a lifelong champion of social justice and spearheaded the establishment of the NHS, the most equitable universal health care system in the world. I was one of those able to benefit from this major change in society, I left home and took up further study and subsequently had a decent, fulfilling profession, unlike my parents who in their working class family could not even afford to attend the grammar school they should have gone to after passing their 11 plus, both leaving school at a very young age.

Attlee+and+Bevan

I am therefore lighting a candle for Atlee and Bevan and all they stood for and which tragically are ultimately being destroyed by Margaret Thatcher’s legacy.

  • A candle in honour of Nelson Mandela who did so much for apartheid and whom Mrs. Thatcher called a ‘grubby terrorist.’
  • A candle for the thousands of innocent people murdered by Pinochet and whom Margaret Thatcher called a champion of freedom, who was later charged with genocide.
  • A candle for the thousands of families and communities who suffered and are still suffering due to the destruction of our 150 coal mines, resulting in the importing of very expensive coal from abroad. We had the safest and most organised mining industry in the world; miners had fought long and hard to get this through their unions. I am sure we can all remember the many stories of colliery disasters in the past. However it was still a challenging and gruelling job and like many I felt so desperately angered about what happened to these hardworking miners.
  • A candle for the many unemployed as manufacturing industries were also closed during Margaret Thatcher’s time resulting in 3.6 million plus citizens ending up on the scrap heap, suffering depression and deprivation with crime and poverty doubling.
  • A candle for the 96 Hillsborough victims whose deaths were not fully investigated during her time.
  • A candle for all of those hardworking people who lost money when banks collapsed and all those suffering now due to the current austerity measures because of bank failures. Financial deregulation that Margaret Thatcher introduced, has turned city institutions into avaricious money pits with their strangle-hold on the lives of ordinary people.
  • A candle to the dead and dying public services and the privatisation for profit that Margaret Thatcher introduced and not forgetting the ensuing corporate greed culture that now exists. These services should be there to benefit the citizens of this country who pay inordinate amounts of varying taxes for such services and should not be allowed to line the pockets of the greedy. Overseas companies are now running many of our services inefficiently and for maximum profit and in which many members of parliament have vested interests.
  • A candle for the thousands who ‘inconveniently’ died after they were found fit to work by Atos, another private overseas company demonising the very sick, some of them my heart buddies. (See Calum’s list if you do not believe me)
  • A candle to the present day draconian measures been undertaken by ‘Thatcherism’ that sees many working families struggling and relying on benefits due to the appalling lack of a living wage, rip off utility prices and astronomical rents. Margaret Thatcher opposed even a minimum wage.
  • A candle to the many homeless and those facing that imminent possibility, due to the bedroom tax as there is a drastic shortage of housing. Margaret Thatcher gerrymandered local authorities by forcing through council house sales which may have been good for the council tenant that could afford them but she prevented councils from spending the money they got from selling the houses to build new ones, in fact spending on social housing dropped by 67%…

These are just a few of the policies that I cannot ever condone, there are many more.

Ultimately there is no doubt in my mind that the rich are getting richer and the poor poorer and I like many activists and campaigners are merely striving to make the world a better, safer and fairer place for the many not the few, with their great sense of entitlement. This is what we have fought for for so long and we cannot allow it to be stolen away, we must protect our rights and particularly those who are particularly vulnerable and fall on hard times through no fault of their own, it could happen to any one of us…No, do not celebrate Margaret Thatcher’s death but consolidate and reflecting on where we are heading and remember the famous words of Bevan:

‘‘No longer will wealth be an advantage nor poverty a disadvantage.”

The Empire of Things: In Memory of Margaret Thatcher

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The Empire of Things In Memory of Margaret Thatcher

Previously published here:

By C J Stone

They hang the man and flog the woman,
Who steals the goose from off the common,
Yet let the greater villain loose,
That steals the common from the goose.

Seventeenth Century English protest rhyme

Riots

It was Margaret Thatcher who said there was no such thing as society. “There are individual men and women, and there are families… It’s our duty to look after ourselves and then… to look after our neighbour,” she said. “People have got the entitlements too much in mind, without the obligations. There’s no such thing as entitlement, unless someone has first met an obligation.”

She said this in an interview with Women’s Own magazine published in October 1987. Six years before that, in 1981, riots had ripped through Britain’s inner cities. There were riots in Brixton in London, in Toxteth in Liverpool, in Handsworth in Birmingham and Chapeltown in Leeds. There were further riots throughout the 80s, including Broadwater Farm in 1985, and Peckham that same year.

On coming to power in 1979, on the steps of Downing Street, Margaret Thatcher had quoted from St Francis of Assisi: “Where there is discord, may we bring harmony. Where there is error, may we bring truth. Where there is doubt, may we bring faith. And where there is despair, may we bring hope.”

Never have a set of words proved to be less appropriate, or more vain, or less honest, or more ignorant of the truth.

The central idea behind Thatcherite policy was an economic theory known as Monetarism. The aim of Monetarism was to break the post war consensus which had given working people unprecedented wealth – a welfare state, a national health service, free education, participatory democracy – and to redistribute that wealth to where its proponents believed it should go: back to the very rich. It did this by deregulating the banks, by breaking the trade unions, by selling off public assets, and by a form of social engineering in which traditional Labour voters were lured into property ownership by selling their council houses to them at drastically reduced rates, and in this way, getting them into debt. Debt became the driving force of the new economy.

Within one year of this we had the first riot: in St Pauls in Bristol.

The Enemy Within

In 1984 Thatcher took on and defeated the Miners. She called the Miners “The Enemy Within”. They were the bastion of working class solidarity in the United Kingdom, fiercely socialist in their outlook. This came directly from their work. Mining is a dangerous job. People who work underground have to watch each other’s backs. This creates a form of solidarity which they then bring back to the surface with them, into the over ground world.*

It is out of adversity that socialism arises.

It is out of love. Solidarity is another word for love.

The National Union of Mineworkers was an organisation of love. You listen to any old Miner talking about their union, and you will hear it. You will hear it in the tone of their voice and in the words they use. It was  their  organisation, forged out of their solidarity, out of the bonds created in the terrible conditions they encountered in their work, out of their history of struggle, out of loyalty to  their class and their fierce independence. The NUM actively stood against the kind of world that Thatcher was promoting. It had to be destroyed.

We had love, and they had greed, and greed won. The defeat of the Miners lead directly to the kind of world we live in now.

*Anyone who doubts this should consider the Chilean Miners. During their first 17 days underground – before they were contacted, when they were nearly starving, and fearful that the probes might not find them – they had instituted a form of democracy, a form of socialism, which many of them say saved them from a descent into barbarity.

There was an irony here. Thatcher appealed to a form of cod patriotism. She promoted patriotic values, waving her rhetorical flag for the assembled audience. And yet she helped destroy this most British of institutions, the National Union of Mineworkers, and to undermine trade unionism as a whole – a British invention – while encouraging an invasion of international corporations in the service industry, such as McDonalds, in which trade unionism was actively banned.

Waving the patriotic flag while inviting a foreign invasion. There’s a word we normally use for this. Under other circumstances we would call it “treason”.

McWages

If the young are not initiated into the village, they will burn it down just to feel its warmth.

African proverb.

Roll on 30 years, to a new Tory government, to a new Monetarism, to a new austerity, a new Thatcherism.

And don’t be in any doubt that this is exactly what it is. When George Osborne told MPs that his deficit-cutting plan had made Britain a “safe haven in the global debt storm”, what he meant was that the financial institutions, to which he is obligated, have approved of his policies. They don’t have to loot the British economy, because Osborne is already handing the loot to them.

It’s a form of protection racket. The world has already seen what a financial mugging looks like. They’ve already broken the backs of governments in Ireland and Portugal and Greece. Give us your wealth, they say, or this is the fate that lies in store for you too. Give us your public property. Privatise, privatise, privatise, and no institution – not even the Health Service – is sacred.

That is what deficit reduction means. It means privatisation: not by the back door, but by the front door. Financial looting. It means taking British capital, currently held by the British state, and handing it over to financial institutions at a reduced rate. “Waving the patriotic flag while inviting a foreign invasion” again.

We are in the midst of an age of unprecedented structural change in our world, a return to feudalism. Feudalism arose out of the collapse of the Roman Empire. It involved a robber class living off the back of a servant class, using rent as its means. The new Feudal Lords use financial rent – indebtedness – in the same way. What we are watching is the collapse of the New Roman Empire into a new Dark Age of institutionalised plunder, a takeover by the banks.

The austerity measures are already being implemented, and it is the young who are being targeted. So tuition fees are going up to £9,000 a year, while the Education Maintenance Allowance for 16-19 year old has been scrapped. Inflation is rampant, while real wages are declining. There is no future for the young. No jobs, no education, no skills, no apprenticeships. These were mostly scrapped by Thatcher 30 years ago. A nation built on skill has been reduced to a service economy, to McJobs and McWages in a McSociety.

You can call it “muck” if you like.

As Above So Below

“When your most elite, most powerful members of society adopt a strategy of plundering…. they will develop a morality that doesn’t simply permit plundering, but valorises it. When that happens the moral structures of a society will inevitably deteriorate. In the upper classes that leads to polite looting. In the underclass it leads to street looting.”

Bill Black on the Keiser Report, 16/08/2008  

The illusion that’s been created is that we are separate beings. We are not. We are social beings. Margaret Thatcher was entirely wrong when she said there was no such thing as society. Society is the very essence of who we are. We are tied together by bonds of language, by bonds of morality, by bonds of loyalty, by bonds of family, by bonds of society, by bonds of love. You break those bonds and the social world begins to fall apart.

Society is the individual write large. The individual is society in microcosm. As above, so below. The unconscious is not underneath us, it is around us. It is not inside of us, it is outside of us. The unconscious is that part of ourselves that lies in other people. It is in the obligations we owe to the people around us, in our human interactions, only barely recognised, as we negotiate our way around our social world.

In the individual personality, rampant, out-of-control egotism is a form of mental illness. Commonly called psychopathy, it is a mental state in which the individual only concerns himself with his own gratification. So if a psychopath gets pleasure from murder, than he will murder, free from conscience, because personal gratification is his only concern. Not every psychopath is a murderer, though. There are psychopaths all around us, and everyone is capable of psychopathic behaviour. Everyone who seeks personal gratification at the expense of his fellow creatures is a psychopath to some degree.

In the social sphere, the financial sector is a kind of collective psychopath, destroying the health of the economy for its private gratification. We honour the psychopath in our current world. It is the world of private gratification of private power. We give power to the psychopath, while denuding and deriding the common good that arises from our common world.

All private wealth is won at the expense of the commons. What we are witnessing right now are the new enclosure acts, the new clearances. We are beings born of the commons and not only our economic, but also our mental and emotional health, is measured by how much we bring to the common good.

Democracy

“If you don’t find God in the next person you meet, it is a waste of time looking for him further.” Gandhi

I saw a BBC reporter interviewing a community activist in one of the riot areas. The activist compared what was happening to the Arab Spring. “But this is a democracy,” the reporter said, in a slightly hurt tone.

Is it though?

There are four pillars to a functioning democracy. We need an effective police force, a free press, rational political institutions and an efficient financial system. All of them must be regulated and free from corruption. What we have instead is a corrupt police force in hock to a corrupt press, with corrupt politicians serving the interests of a corrupt financial elite. Corruption from top to bottom. Corruption in every avenue of our public life. Top policemen taking bribes, politicians on the make, an intrusive and bullying press, distracting us with trivia and gossip, while covering up its own illegal practices, and a City of Londonwhich is entirely out of regulatory control, and which is plundering the nation’s resources for its own private gain.

And you wonder why the young riot?

The kids are looting the shops.

The banks are looting the nation.

Then we have the Labour Party – the Party created by the working class in the early part of the last century to institute socialist policies through democratic means – being seduced by high finance, and taking part in the financial rape of this country. Tony Blair amassing a personal fortune by taking us to war. Gordon Brown bailing out the banks and indebting the nation, borrowing money from the banks to give to the banks, imposing dangerous levels of debt on future generations. Peter Mandelson declaring: “We are all Thatcherites now.” What hope for us when even our own party stands against us?

The Empire of Things

“These people are living in a financial prison, and this is a prison riot.”

Max Keiser on the Keiser Report, 16/08/2008   

We’ve had over 30 years of rampant individualism, of consumerism, of me-ism and the devil take the hindmost; 30 years of mortgaging our future to pay for our present consumption; 30 years of selling off our birthright for a mess of consumerist pottage; 30 years of corruption and greed, of the worship of Things. It is an Empire of Things. So we have our technology and our consumer durables, our computers and our mobile phones, our technical baubles. Well some of us have. Many of us don’t have these Things. The young in particular, don’t have these Things. The young from the sink estates, the second and third generation underclass.

So we’ve set these Things up in place of our values. We’ve substituted them for the social ties that used to bind us together, and we’ve told the young who can’t afford these Things, that they are the only measure of value, that you don’t count unless you can flaunt these Things in the faces of your peers. That only Things count. And then society starts to break down under the pressure of the new Feudal arrangements, in which we are becoming economic vassals paying homage to debt, and the kids take to the streets in a blind fury of acquisitive excitement. And what do they do? They steal. They loot. They plunder. They obey the rules laid down on them by the Empire of Things. They collect the very Things we told them to, declaring fealty to the Things that are our Lords in the new fiefdom of debt.

They do what we tell them to do and then we punish them for it.

The bankers have plundered the economy, and they have been rewarded. The politicians have plundered their expenses, and they still sit in Parliament. The Murdoch Press have corrupted our values, and yet they are still allowed to own newspapers. The police have taken bribes, and yet they talk brazenly of the criminality of the streets.

Young people are put in gaol for the theft of a bottle of water, while bankers are given bonuses for the plunder of nations. People are losing their homes because their children are suspected of rioting, while politicians, who claimed for multiple homes on their expenses, are allowed to bleat on about rioters and looters from their privileged position in the House of Commons.

It’s at this point that I would like to agree with Margaret Thatcher. As she said: “People have got the entitlements too much in mind, without the obligations. There’s no such thing as entitlement, unless someone has first met an obligation.”

To whom do we owe the obligation? To society, of course.