Will Johnson Quit or Be Forced Out, Once He Has Wrecked the Country For Brexit?

Also in Lobster 80 for Winter 2020 is a very interesting piece by Simon Matthews, whose observations about Johnson’s real motives for running for PM and supporting Brexit I discussed in my previous blog post. Matthews has a piece, ‘Time for the Pavilion (or: there are 365 Conservative MPs)’ pondering whether Johnson will either retire as PM or be forced out by angry members of his own party, once he has successfully ruined the country with a hard Brexit.

And Matthews makes some very interesting observations. Johnson’s majority looks impressive, but is actually very fragile. 50 Tory MPs, for example, voted against the imposition of the second national lockdown at the beginning of November. And many of the 80 new MPs forming the Tories’ parliamentary majority actually have very small majorities in their own constituencies. He writes

Secondly, and less remarked upon, Johnson’s majority of 80 is actually quite fragile. No fewer than 78 Conservative MPs have a majority of 5,000 or less, and of these 34 have a majority of 2,000 or less. Indeed,
all the fabled ‘red wall’ seats that Johnson gained are in this category. Any MP in this situation would be aware that it really wouldn’t take much of an electoral swing to oust them.

Also, although the background of the typical Tory MP is privately educated, with a background in the financial sector, think tanks and policy groups, and is strongly anti-EU, there are still 102 Tory MPs who support the European Union.

Finally, and a puzzling anomaly, there are still 102 Conservative MP’s who were pro-EU in 2016. Admittedly, some of these may have been so at that time because it was party policy (i.e. now party policy has changed,
their views will have changed, too); and there will be others who were ‘pro-EU’ on the basis of Cameron’s re-negotiation of 2015-2016. But, nevertheless, amongst those 102 there must be some (40? 50?) who would much rather the UK stayed as close to the EU as possible, including membership of the Single Market, Customs Union and the EEA rather than exit everything, in its entirety.

BoJob’s position is very precarious. If things get very desperate, and the Tory party does decide it wants to form a ‘government of national unity’ in a coalition with Labour and the Lib Dems, it would only take 45 Tory MPs to oust him.

The article then goes to discuss the problems Johnson faces from Brexit, and particularly the challenge it poses to the integrity of the UK, and opposition from Northern Ireland, Scotland, Wales, the EU and the Americans, and members of both chambers of parliament. He’s also got severe problems with the Covid crisis, and the havoc this and the consequent lockdown has played with the economy. The sacking of Dominic Cummings could be seen as a warning shot to Johnson from Brady and the party’s donors out in the tax havens, who feel they are being ignored by the PM. But he notes that the donors and corporate backers really don’t seem to have an idea of the massive damage that Brexit will inflict on the UK economy. It will destroy 60-65 per cent of UK manufacturing, and although stockpiling of food and other goods has been going on since 2017, these supplies can only last for so long. So that Britain will return to the food queues of the ’60s and ’70s at the borders.

He makes the point here that the majority of British ports are foreign owned. In footnote 7 he writes

The owners of the UK’s main trading ports are Associated British Ports (owned in Canada, Singapore and Kuwait), Forth Ports (Canada), Hutchison Port Holdings (Singapore), Peel Group (the Isle of Man and Saudi Arabia), PD Ports (Canada) and Peninsular and Oriental Group (complex, but seemingly Dubai, China and Hong Kong). The latter group include P&O Dover Holdings Ltd, which operates most of the ferry services out of Dover, and is owned by the Peoples Republic of China. (The other ferry services at Dover, DFDS, are owned in Denmark). The intention post-Brexit of declaring many UK ports ‘free ports’, when so many can be connected back to tax havens anyway, is striking, and one wonders to what extent the owners of these ports have lobbied for that outcome.

Matthews concludes that Boris is on such shaky grounds that he may well decide to jump before he’s pushed.

The truth is that Johnson can now be ambushed by so many different groupings for so many different reasons, that the chances of him remaining PM after he has delivered the hard Brexit his backers require
must be doubtful. And why would he anyway? He looks bored most of the time and wants money. Leaving Downing Street – and the cleaning up – to others, gives him time to spend with his many different families, time to write his memoirs for a hefty advance, the chance of a US TV show and time to kick on, as all ex-UK PMs do, with earning serious money on the US after-dinner speaking circuit. The possibility that some formula will be devised to facilitate his exit, possibly a supposed medical retirement, looks likely.

After all, he’s been sacked from every job he’s ever had. Why would he wait until he is sacked from this one?

See: Time For the Pavilion (Winter 2020) (lobster-magazine.co.uk)

I found this interesting in that it showed that there is grounds for optimism amongst the gloom. The Tories have a huge majority, but it’s fragile. Very fragile. If Starmer actually got his act together and started behaving like a leader of real opposition party, he could start cutting it down significantly. But he doesn’t, perhaps because, as a Blairite, the only policy he has is stealing the Tories’ and winning the support of their voters, and backers in big business and the Tory media. Hence his silence and his determination to persecute the socialists in the Labour party.

It also shows just how much damage the ‘No Deal’ Brexit Johnson seems determined to deliver will do to Britain. It’s going to wipe out nearly 2/3 of our manufacturing industry. This won’t matter for the Tories or Blairite Labour. Blair took the view that British manufacturing was in decline, and that it could be successfully replaced by the financial sector. This hasn’t happened. Ha-Joon Chang’s 23 Things They Don’t Tell You About Capitalism argues very clearly that the British and other economies still depend very much on the manufacturing sector. The fact that it appears comparatively small to other sectors of the economy merely means that it hasn’t grown as much as they have. It does not mean that it is irrelevant.

And it also shows once again how this chaos and poverty is being driven by a desire to protect the Tories’ backers in the financial sector, and the foreign companies owning our utilities, as well as the British rich squirreling their money away in tax havens. Shaw pointed this all out in once of his books written nearly a century ago, condemning the way the idle rich preferred to spend their money on their vapid pleasures on the continent, while the city preferred to invest in the colonies exploiting Black Africans instead of on domestic industry. He stated that while the Tories always postured as the party of British patriotism, the opposite was the truth: it was the Labour party that was genuinely patriotic, supporting British industry and the people that actually worked in it.

Shaw was right then, and he’s right now, no matter how the Tories seek to appeal to popular nationalistic sentiment through images of the Second World War and jingoistic xenophobia about asylum seekers. The Tories haven’t backed British industry since Thatcher and Major sold it all off. The only way to build Britain back up is to get rid of her legacy.

Which means getting rid of Johnson, the Tories and Starmer.

Was Mussolini’s 1931 Policy on the Banking Crash Better than Britain’s 2008 Bail-Out?

Here’s another interesting question posed by the changing policies of the Italian Fascist state towards industry and the financial sector. Fascism celebrated and defended private industry as the essential basis of the Italian economy and society. When Mussolini first took power in the early 1920s, he declared that Fascism stood for ‘Manchester School’ capitalism – privatisation, cuts to public services and expenditure and the lowering of wages and welfare benefits. But this changed with the development of the Fascist state through the establishment of the corporations – industrial organisations combining the employers’ organisations and the trade unions, which were supposed to take over the management of industry – autarky, which aimed to make Italy self-sufficient and the movement to a centrally planned economy.

This was partly achieved in the early 1930s when Mussolini set up two state institutions to buy out the Italian banks following the Wall Street crash of 1929 and the ensuing depression. These not only bought out the banks, but also the industries these banks owned and controlled, so that the Italian state ended up owning just under a fifth of the Italian economy.

This is described in a passage in the article ‘Industry’ in Philip V. Cannistraro’s Historical Dictionary of Fascist Italy (Westport, Connecticut: Greenwood Press 1982). This runs

Two public agencies were created to save banks and crucially affected industries: the Istituto Mobiliare Italiano (IMI) on November 13, 1931, which was to control credit; and the Istituto per la Ricostruzione Industriale (IRI) on January 23, 1933. IRI was by far the more radical solution, for it purchased all the shares of stock in industrial, agricultural, and real estate companies previously held by banks. (The banking law of 1936 prohibited banks from extending long-term credit to industrial concerns). Although the industrialists fully expected a return to “normalcy” and to private enterprise after the crisis had passed, Mussolini had successfully created an instrument for the permanent intervention of government in the economy. By 1939 IRI controlled a series of firms representing 44.15 percent of the capital of Italian stock values and 17.80 percent of the total capital of the country – hence, the Fascist government controlled a proportionately larger section of national industry than any other government in Europe except the Soviet Union. (p. 278).

This allowed the government to interfere and restructure the Italian economy leading to the expansion of the manufacturing economy and a reduction in imports. On the other hand, poor government planning and an inefficient bureaucracy meant that Italian domestic manufactures were frequently inferior and the country had a lower growth rate than many other western European countries.

But this contrasts very strongly with policy of Britain and America to the financial sector after the 2008. The banks were bailed out with public money, but were not nationalised and the government has continued with its ‘light touch’ approach to regulation. Meaning that the banks have been free to carry on pretty much as before. Public spending, especially on welfare, has been drastically cut. Despite the Tories claiming that this would boost the economy and they’d pay of the debt within a couple of years or so, this has very definitely not happened. In fact, the debt has massively increased.

This has added to the long term problems of Britain’s manufacturing industry. Left-wing economists have pointed out that Britain’s domestic industries suffer from a lack of capital because the financial sector is geared towards overseas investment. A situation that has no doubt got worse due to globalisation and the personal investment of many Tory and New Labour MPs in foreign industry and their savings in offshore tax havens. British industry has also suffered from the ignorance and neglect of successive prime ministers from Maggie Thatcher onwards. Thatcher couldn’t understand that her policy of keeping the Pound strong would damage British exports, and in any case did not want to rescue failing British industries. They were either to be allowed to go under, or else sold to foreign companies and governments. Tony Blair went further, and believed that manufacturing industry’s place in the British economy could be successfully taken over by the financial sector and the service industries.

But this has also been a failure. Ha-Joon Chang in his 23 Things They Don’t Tell You About Capitalism has pointed out that manufacturing industry is still very much of vital importance. It’s just that it has grown at a slower rate than the other sectors.

Fascist Italy was a totalitarian dictatorship where Mussolini ruled by fear and violence. There was no freedom of speech or conscience in a system that aimed at the total subordination of the individual, economy and society. Mussolini collaborated with Hitler in the persecution of the Jews, although mercifully this wasn’t quite so extreme so that 80 per cent of Italian Jews survived. The regime was aggressively militaristic aiming at the restoration of a new, Roman-style empire in the Mediterranean. Albania, Greece and Ethiopia were invaded along with Tripoli in Libya and Fascist forces were responsible for horrific atrocities as well as the passage of race laws forbidding racial intermixture with Black Africans.

It was a grotesque, murderous regime which was properly brought to an end by the Allied victory of the Second World War. It must never be revived and Fascism must be fought every where. But it does appear that Mussolini’s policy towards the banks and industry was better than that pursued by our supposedly liberal democracies. But the governments of our own time are also becoming increasingly intolerant and authoritarian. The danger of our country becoming similar repressive dictatorship under Boris and the Tories is very real.

We desperately need the return to power of a genuinely socialist Labour government, committed to investment in the welfare state and public services with a nationalised NHS, a mixed economy and positive commitment to democracy and freedom of speech rather than the illusion maintained by the mainstream media and Tory press.

And that will mean overturning over three decades of Thatcherite orthodoxy on the banks and financial sector, just as Mussolini changed his policies towards them with the aim of restoring and expanding Italian industry.

From 1996: Downsizing Guru Realises It Doesn’t Work

Remember the downsizing craze of the 1980s and 1990s, when Thatcherite economists all demanded that big firms should slim down through mass lay-offs and sackings? Firms were overstaffed, and it was all flab that needed to be cut out to make them ‘lean and mean’ in the marketplace.

Looking back through my scrapbooks of newspaper clippings, I found this article by the Daily Mail’s industrial correspondent, David Norris, ‘Guru of the job cutters admits downsizing has its down side’ in that paper’s edition for Monday, May 13, 1996. The article runs

‘An international economic guru who advocated massive job-shedding to make big business lean and fit has admitted he got it all wrong.

American Stephen S. Roach coined the word ‘downsizing’ in the early Eighties to sum up his philosophy that ruthless workforce pruning was needed to boost profits and productivity.

It was seized on around the world – not least in Britain, where hundreds of thousands of full-time jobs have disappeared over the last ten years.

His astonishing turnaround is certain to provoke more outrage against ‘fat-cat’ bosses, who have often used huge payroll savings to justify big salary rises for themselves.

‘Downsizing’ became a boardroom buzzword, with directors proudly telling shareholders that they were able to  pay higher dividends through redundancy-related cost-savings. The slick  term was more acceptable than talking of throwing people out of work.

Middle England has been worst hit, with thousands of white-collar jobs axed. High street banks have between them got rid of 90,000 staff since 1989. Downsizing has created a climate of insecurity which many blame for the still sluggish economic recovery. And the Government has lost millions of pounds in tax from workers axed from previously labour-intensive industries.

It emerged yesterday that Mr Roach, chief economist at the investment bank Morgan Stanley on Wall Street, announced his conversion in a memo to his firm’s clients.

He confessed he had now concluded that relentless cost-cutting was bad for business. ‘If you compete by building, you have a future. If you compete by cutting, you don’t’,’ the contrite guru said.

‘For years I have extolled the virtues of America’s productivity-led recovery. While I think it’s safe to say that such a scenario has become the new mantra for U.S. businesses in the 1990s, I must confess that I’m now having second thoughts.”

And he warned of a worker backlash ‘not on the shopfloor, but in the polling booths’.

That forecast was echoed by TUC boss John Monks yesterday.

He said: ‘Downsizing has done more than any other single business strategy to create the deep insecurity felt in Britain.

‘I hope this will herald a re-think in Britain’s boardrooms. Long-term success comes from steady investment and skilled, motivated staff.”

Around 38 per cent of Britain’s workforce – nearly ten million people – are now not in full-time permanent jobs. They are either in part-time or temporary work, or self-employed.

The main full-time job creation thrust has come from small firms, employing 20 staff or fewer. They have taken on 2.5 million extra workers in ten years.

Big retail chains have also taken on more workers. Tesco recently announced it was recruiting 4,500 to pack bags and generally assist shoppers. Last month it revealed record profits.

Late payment is still a problem for 45 percent of small and medium businesses.

The average time taken to be paid has risen from 52.8 days in 1994 to 53.2 this year, according to a survey by the Confederation of British Industry and accountancy firm Coopers & Lybrand.’

Ha-Joon Chang describes in his book, 23 Things They Don’t Tell You About Capitalism, how downsizing has literally driven firms bankrupt. They cut back their staff and plant so much in order to boost management pay and shareholder dividends beyond the point where they were economically viable. He argues that the most durable firms tend to be those where the state also has a stake in the firm, and so in maintaining it, or where the workers are also strongly involved in its management. Chang’s not anti-capitalist, but he states that shareholders are fickle – the moment they think a firm is no longer as profitable as another company, or is in trouble, they’ll sell their shares and go elsewhere.

Despite this attack on downsizing’s credibility and the loss of government revenue it has created, job insecurity has increased massively to the point where it is normal. Blair and Gordon Brown are as responsible for this as the Tories, as they accepted the neoliberal, Thatcherite dogma that the labour market had to be fluid and flexible. Which means that firms should find it easy to lay off staff and their should always be a supply of cheap workers waiting to be taken on.

Thatcherism has been a disaster. This clipping from a quarter of a century ago shows one of its central doctrines was recognised as such by the man who invented it even them. But it’s kept the rich richer, and the poor poorer, and so despite articles like this, it’s still being pushed.

And the result is a Britain of despair and poverty where working families, never mind the unemployed and disabled, are dying of starvation or forced to use food banks.

 

Lobster on the Economic Damage Caused by the Financial Sector

Lobster over the years has criticised the dominance of the financial sector over the British economy, and attacked the way this has actively harmed other sectors, particularly manufacturing industry. Thatcher, Major and then Tony Blair favoured banking and financial services over the industries, partly from economic illiteracy and partly from the conviction that Britain’s manufacturing sector was doomed. Thatcher believed very much in a strong pound and didn’t think it would harm the manufacturing industries. One of the few businessmen from that sector in Thatcher’s government tried to tell her otherwise, and show her that it would damage our exports by making them too expensive over our competitors. But Thatcher wouldn’t hear of it. She was convinced that it wouldn’t have any effect on manufacturing because the Germans had a strong manufacturing base, and they had a strong Deutschmark. The businessman tried to explain to her that the Mark was strong because they had a strong manufacturing base, not the other way around. But it was too much for the Leaderene’s brain and she refused to listen.

Thatcher also made it very clear that she was not going to help failing industries. What help there was, was supposed to come from the privatisation of state utilities and the operation of market forces. This was supposed to open up new forms of private investment. If they didn’t, then that company or industry was uncompetitive and doomed to fail. Meanwhile, the thinking went that the financial sector would take over from the failing manufacturing industries as a new source of wealth and employment. Thus Blair, Brown and the late Mo Mowlam opened up the ‘prawn cocktail’ campaign to win over the City of London, promising light regulation. One of the chief executives at the Bank of England, imported from America, was Deanne Julius, who said that Britain should abandon its manufacturing industries and allow them to be replaced by America’s. Instead, Britain should concentrate on the service industries.

This is another load of neoliberal economic rubbish that has been conclusively proved wrong. The Oxford economics professor, Ha-Joon Chang, in his book 23 Things They Don’t Tell You About Capitalism shows that despite Thatcherite dogma, manufacturing is still crucially important for the British economy. It only looks weaker than the other sectors, because it has grown at a slower rate.

Now Robin Ramsay in the latest update to his ‘News from the Bridge’ column in Lobster 78 has published a piece actually describing the active harm the privileged position of the financial sector has done the British economy as a whole. It’s in a piece ‘The Future of Britain’s Crisis’, which begins with a few sharp observations about the impotence of the House of Commons Security and Intelligence Committee. This is supposed to supervise Britain’s intelligence services, but its lack of effective power is demonstrated by Johnson’s suppression of the report into Russian influence in UK politics. From leaks to CNN and others, it shows that rich Russians have purchased UK citizenship and poured money into Tory coffers. He states that this is just part of the price Britain has to pay for Britain being one of the leading centres of money laundering. He continues

The idea that there is a structural conflict between the interests of the manufacturing economy and that of the City has been around since the late 1970s in my experience, and probably much longer. The conflict was rarely articulated by public figures beyond the British left but in 1980, with Bank of England base rates lifted to 14% ‘to control inflation’, Sir Terence Beckett, director-general of the Confederation of British Industry (CBI), told its annual conference that they had to ‘to take the gloves off and have a bare-knuckle fight’ with the Thatcher government. But no such fight ensued, Beckett resigned and in the following decade while the City boomed, British manufacturing shrank by about 20%.

The focus these days is less on structural conflict than on what is known as ‘over-financialisation’: roughly, that the financial sector gets to be too big for the rest of the economy. Recently a trio of economists/econometricians (from the Sheffield Political Economy Research Institute at the University of Sheffield) have tried to quantify the cost of UK over-financialisation and have concluded:

‘Our calculations suggest that the total cost of lost growth potential for the UK caused by “too much finance” between 1995 and 2015 is in the region of £4,500 billion. This total figure amounts to roughly 2.5 years of the average GDP across the period.

The data suggests that the UK economy, may have performed much better in overall growth terms if: (a) its financial sector was smaller; (b) if finance was more focused on supporting other areas of the economy, rather than trying to act as a source of wealth generation (extraction) in its own right.

This evidence also provides support for the idea that the UK suffers from a form of “finance curse”: a development trajectory of financial overdependence involving a crowding out of other sectors and a skewing of social relations, geography and politics.’ [Emphases in the original.] 

On similar lines, Grace Blakeley writes in her On Borrowed Time: Finance and
the UK’s current account deficit, that

‘Rebalancing the UK’s international position requires moderating the significance of finance within the UK economy and bringing asset price volatility under control, while nurturing non-financial exporting sectors.’

Ramsay concludes the article by remarking that it would be a difficult job convincing the political establishment of this, never mind the electorate. The failure of people working within London to understand that the capital’s influence and share of the country’s wealth is harming the rest of the country has helped the rise of the Scots and Welsh Nationalists, along with less significant movements like the Yorkshire Party, the Campaign for the North and Mebyon Kernow.

See: https://www.lobster-magazine.co.uk/free/lobster78/lob78-view-from-the-bridge.pdf

£4,500 billion lost to the British economy between 1995 and 2015! 

And never mind the millions of jobs lost, the destruction of working class communities right across the country from Cornwall to Scotland and Northern Ireland, lost skills and damaged lives!

All that simply so that Thatcher’s, Blair’s, and now Boris and Rees-Mogg and their chums in the City of London could make a tidy profit.

This is proof that we need a Corbyn government that will do something for public services and manufacturing industry, rather than more of the self-serving Tory economic policies that benefits only the City.

What A Surprise! Anti-NHS Thinktank Funded by Tobacco and Fast Food Industries

One of the fascinating articles Mike put up yesterday was about an article in the British Medical Journal that reported that Institute of Economic Affairs, a right-wing think tank that funds the Tories and which demands the privatisation of the NHS, is funded by all the industries that actively damage people’s health: tobacco, gambling, alcohol, sugar and fast food. One of the major donors to this secretive think tank is British-American Tobacco. The report noted that the IEA had attacked campaigns against smoking, drinking and the obesity academic, and raised concerns that a future leader of the Tories would side with these industries against the interests of the British people.

Well, as Bill Hicks used to say ironically, ‘Colour me surprised!’

I don’t wish to sneer at the doctors and medical professionals behind this article, and am absolutely fully behind its publication. But I’m not remotely surprised. It’s almost to be expected that a think tank that demands absolute privatisation and deregulation in the interests of complete free trade, should be funded by those industries, which have the most to lose from government regulation. And in the case of the Tories, that has always included tobacco, alcohol and gambling. Way back in the early ’90s under John Major, when Brits were just beginning to get into the habit of binge drinking and the government was considering allowing pubs and nightclubs all day licences, there were concerns about the damaging effects of alcohol. People were demanding greater regulation of the drinks industry. But this was being blocked by the Tories, because so many Tory MPs has links to these companies. This was so marked that Private Eye actually published the names of these MPs, and the positions they held in various drinks companies.

As for gambling, the Labour government after the War tried to crack down on this, but it was the Tories under MacMillan, who legalised the betting shops. Later on, Tony Blair, taking his ideas from them, had plans to expand the British gambling industry further with the opening of ‘super-casinos’, one of which was to be in Blackpool, I believe. But fortunately that never got off the ground. Unfortunately, there has been a massive rise in gambling addiction, despite all the warnings on the the adverts for online casinos.

The Tories have also had a long relationship too with the tobacco industry, resisting calls for bans on tobacco advertising. Private Eye also reported how, after Major lost the election to Blair, former Tory Chancellor of the Exchequer Kenneth Clarke then got a job with British-American Tobacco. As did, I believe, Saint Maggie of Grantham herself. BAT was employing him to open up markets in the former Soviet central Asian republics. The Eye duly satirised him as ‘BATman’, driving around in a car shaped like a giant cigarette, shoving ciggies into people’s, mostly children’s, mouths.

The Institute of Economic Affairs is a particularly nasty outfit that’s been around since the mid-70s. For a long time, I think it was the only think tank of its type pushing extreme free market ideas. A couple of years ago I found a tranche of their booklets in one of the secondhand bookshops in Cheltenham. One was on how the state couldn’t manage industry. This looked at four examples of state industrial projects, which it claimed were incompetently run and a waste of money. One was the Anglo-French supersonic airliner, Concorde. The booklet had a point, as many of the industries they pointed to, like British Leyland, were failing badly. Concorde when it started out was a massive white elephant. It was hugely expensive and for some time there were no orders for it. But now it is celebrate as a major aerospace achievement. While the British aircraft industry has decline, the French used the opportunities and expertise they developed on the project to expand their own aerospace industry.

Looking at the booklet, it struck me how selective these examples were. Just four, out of the many other nationalised industries that existed at the time. And I doubt the pamphlet has worn well with age. Ha Joon Chang’s 23 Things They Don’t Tell You About Capitalism and John Quiggin’s Zombie Economics have very effectively demolished their shoddy and shopworn free market capitalism, and shown how, rather than encouraging industry and prosperity, it has effectively ruined them. Read these books, and you’ll see just why we need Corbyn, whatever the champions of free market capitalism scream to the contrary.

Oh yes, and ladies, particularly, be warned. This is an anti-feminist organisation. Mike mentions in his article that it has a spokeswoman, Kate Andrews, who turns up regularly on Question Time to push for the privatisation of the NHS. Or rather, its reform, as they don’t want to alarm the populace by being too open about what they want to do. Despite this feminine face, this is an organisation that has very traditional views about gender roles. One of the pamphlets I found had the jaunty title Liberating Women – From Feminism. The booklet was written by women, and I know that some women would prefer to be able to stay home and raise their children rather than go to work. And that’s fine if it’s their choice. But this outfit would like to stop women having a choice. Rather than enabling women, who choose to stay home, to do so, they would actively like to discourage women from pursuing careers.

The IEA really is a grubby organisation, and the sooner it’s discredited everywhere, the better. Like the Tories.

Now Tories Troubled by Split

Yesterday, a group of three MPs, Sarah Wollaston, Heidi Allen and Anna Soubry, defected from the Tory party to join the Independent corporation, that had split from Labour.

At their press conference they gave three reasons why they had left. Heidi Allen said she was disgusted with the suffering the party had inflicted and its lack of benevolence. For Sarah Wollaston, it was the harm the Tories had done to the manufacturing industry. And for Anna Soubry it was the way her former party had wrecked the country with their massively inept handling of Brexit. Or it might have been Wollaston, who was most concerned about Brexit, and Soubry about the destruction of Britain’s manufacturing sector under the Tories. This is how the reasons for their departure was presented on one of the short videos on YouTube, although I got the impression from listening to Heidi Allen speaking on the 45 minute long video of their press conference put out by Channel 4 News that she was also concerned about Brexit and the attack on manufacturing, as she also ran her own manufacturing firm.

The Tories, who had previously been gleefully exploiting Chuka Umunna and company’s split from the Labour party, were left outraged in their turn. Hunt gave a speech saying how much he regretted the departure of such valued colleagues. Other Tory functionaries demanded that the Splitters should now call a bye-election. Just like the real supporters and activists in the Labour party have been demanding Umunna and his coteries of bitter Blairites do.

I don’t know how sincere Allen and her two colleagues are about the suffering caused by the Tory party. She made a number of speeches saying how upset she was by the suffering caused by her former party’s wretched welfare reforms, but voted for them all the same. So in her case it was, as Mike pointed out, a case of crocodile tears. She may be genuine, and that after years of dutifully following the party line her conscience has won at last. Or it may simply be that, like some other Tories, she’s just worried that the electorate will punish the Tories for the misery they’ve inflicted at the next election.

I think the three’s statement that they’re concerned about British manufacturing and the devastating effects of Brexit are rather more genuine. Margaret Thatcher and Blair in his turn ignored the manufacturing sector. One members of Thatcher’s cabinet, who was the only member in it from that sector of the economy, described how he couldn’t get Thatcher to understand that a strong pound would harm British manufacturing by making our products more expensive. She also uncritically accepted as an article of her neoliberal, free market dogma, that failing firms and industries should be allowed to go under, and should not be given government assistance. Which contrasted with Labour’s promotion of the National Enterprise Boards and state assistance for British industry, where the government would help firms acquire plant and equipment.

And as a good Thatcherite, Blair also adopted her destructive attitude to British industry. He was also quite happy to see British manufacturing collapse. Instead, its place at the heart of the British economy would be taken by the financial sector and the service industries. Deanne Julius, a leading official at the Bank of England, recruited from America, actually said that Britain should give up its manufacturing industry, and simply concentrate on the service industries.

The result has been that vast swathes of traditional British industry have been destroyed by Thatcherism, including mining. Which was done simply to destroy the miners’ union, so they could never overthrow a Tory government as they had Heath’s. However, as Ha Joon-Chang has shown in his book, 23 Things They Don’t Tell You About Capitalism, manufacturing is still an extremely important part of the British economy. It looks weak simply because it hasn’t expanded as much as the other sectors of the British economy. But if it went, the British economy would collapse completely.

As for Brexit, the past few weeks have seen company after company leave the UK because of the Tory party’s incompetence. They’re leaving because we haven’t reached a trade agreement with EU, and so the tariff barriers that will be erected after Britain leaves will make it difficult for them to sell their products after our departure. The latest firm to announce it was closing down its British plant has been Honda in Swindon. When this goes, so do 3,500 jobs.

But I doubt that this will concern those in the Tory party demanding a hard Brexit, like the odious Jacob Rees-Mogg. The financial sector has also been hit, with various banks and international financial regulators announcing that they will leave Britain for Dublin, Paris and the Netherlands. But this doesn’t seem to dismay Mogg and his comrades. They seem to be all financiers, who make their money through investing in companies around the world. And so the destruction of the British manufacturing sector simply doesn’t affect them. They’ll get their money anyway.

The Tory party is seriously split over Brexit. It was to call the Eurosceptics’ bluff that Cameron called the referendum in the first place. He was so confident that people would vote ‘remain’ that he didn’t do any proper campaigning. The result was that he was astonished when the ‘Leave’ vote prevailed. But I gather that the Tories were on the edge of splitting years before, when Tony Blair was in power. Blair stole their policies, and indeed moved further right than the Tories had dared. The party was also split between the Tory paternalists and Thatcherites, and the rural sector, which believed that British agriculture and country communities were being ignored. I’ve heard it said that if Brown had won the 2010 election, the Tories would have collapsed completely, and would have tried to rebrand themselves instead as the English Nationalists. This has the ring of truth, as I do remember one opinion piece in the Heil actually recommending that the party thus rename itself.

I hope that the departure of Allen, Wollaston and Soubry will spark a series of other defections from the Tories and bring about the party’s much-need demise. It’s brought nothing but misery and poverty to Britain’s working people since Thatcher came to power in 1979. And even if the party doesn’t collapse completely, I want there to be so many defections that at the least it causes the collapse of May’s vile, malignant, destructive government.

Tory Health Minister Matt Hancock Receiving Donations from NHS Privatisation Think Tank

On Monday Mike published a very interesting piece revealing that Matt Hancock, the Secretary of State for Health and Social Care, has been receiving donations of between 2,000 and 4,000 pounds after his election in 2010. The donor is one Neil Record, a currency manager. Who is also the head of the board of the Institute of Economic Affairs. The IEA is one of the key think tanks behind Thatcher’s programme of privatizing everything that isn’t nailed down, and destroying the welfare state. All for the benefit of private industry, of course. It is very firmly behind the privatization of the NHS, and the IEA is campaigning to introduce a private medical service funded by private health insurance, as in the US. Where their system has broke down to such a level that 40,000 each year die because they can’t afford their medical care, and where 7 million Americans last year lost their insurance cover.

However, the IEA, according to Mike, has responded to critics of NHS privatization by saying that they’re opposed patients having a choice.

Ah yes, ‘choice’. That old Thatcherite canard. I can remember being told by one of the Tory students at College that private industry provided ‘choice’. It was one of the mantras of Maggie Thatcher. Someone once asked her what the essence of Christianity was. Her answer was simple: ‘Choice’. So, nothing about salvation from sin, the healing of a broken world, the moral duty to work for the public good and create a better society, provide for the poor, the sick, disabled and marginalized. No, nothing about that. Just ‘choice’. No wonder she fell out with Archbishop Runcie and the Scots Kirk. She had no idea.

Mike concludes his piece on Hancock with the words

In fact, privatisation would force patients into insurance schemes that are unlikely ever to pay out, meaning patients would end up with no choice at all.

The IEA is a firm fan of such insurance schemes.

And our Health Secretary takes its bribes cash.

We’ll need to watch this one carefully. Will he try to use Brexit to put through his real paymasters’ plan?

See: https://voxpoliticalonline.com/2019/01/28/how-can-we-trust-the-tory-government-when-its-ministers-behave-like-this/

It isn’t just the fact that the private insurance schemes the Tories and New Labour would love to force us all into won’t pay out that makes all the claims of ‘choice’ a farcical lie. It’s the fact that under Blair’s introduction of private medical care in the NHS, costs still have to be kept down. Blair’s reforms were based on those of the private healthcare group, Kaiserpermanente in America, which he wrongly believed provided better value for money that state-managed healthcare. Under their system, there was a special office that looked into the comparative treatment prices of different hospitals, and the patient got sent to the cheapest, regardless of what he or she personally wanted. There was no choice.

I’m not at all surprised that Hancock has been receiving money from the privatisers. All the Tories and New Labour have. The privatization of the NHS was heavily pushed by private healthcare firms like Unum under John Major and his wretched health secretary, Peter Lilley, and then under Tony Blair. Who was surrounded by any number of private healthcare companies desperate for some of that sweet, sweet NHS action. Like BUPA, Nuffield Health, Virgin Healthcare, Circle Health and others.

As for the IEA, I found a slew of their pamphlets in one of the secondhand bookshops in Cheltenham, and actually couldn’t believe how bad they were. There was one pamphlet arguing that the state can’t run industries, as shown by about 4-6 very carefully selected examples. One of them was Concorde, which did initially have a very difficult time selling the plane. However, while British aerospace companies have continued to be troubled, the French used the expertise they developed with the project to expand theirs. And Ha-Joon Chang in his book, 23 Things They Don’t Tell You About Capitalism shows very clearly that the state very much can run private companies very successfully. The examples in the IEA pamphlet are obviously very carefully cherrypicked.

And I don’t think it’s just in the economic sphere that the IEA is a backward influence. Along with this pamphlet was one Liberating Women from Feminism, which I think was basically arguing that the ladies should give up any hope of having a career or equality, and go back to running the home. I’m sure some women would like to, and that’s fine if it’s their free choice and they find it fulfilling. But the majority of women these days want a career and economic parity with blokes. And the IEA’s campaign against that would leave many women without any choice, as it was until only a few decades ago. Which all shows how much they really believe in ‘choice’.

Get the IEA and the other privatizing think tanks out of politics, and Matt Hancock and Tweezer out of government. We need a real, socialist Labour government to restore the NHS. A government that has to be led by Corbyn.

Tony Benn on Capitalism’s Failure and Its Use as System of Class Control

I put up a long piece the other day about two books I’d bought by Tony Benn, one of which was his Arguments for Socialism, edited by Chris Mullin (Harmondsworth: Penguin 1979). Benn is rightly revered as one of the great champions of socialism, democracy and working people of the late 20th and early 21st century. Reading the two books I ordered has been fascinating, because of how so much of them remain acutely relevant to what is going on now, in the last years of the second decade of the 21st century. It struck me very hard that you could open his books at random, and find a passage that would still be both highly enlightening and important.

One such passage is in the section of his book, Arguments for Socialism in the chapter dealing with the inheritance of the Labour party, where he deals with Clause IV. This was the section of the Labour party’s constitution which committed it to the common ownership of the means of production, distribution and exchange. This was removed in the 1990s by Tony Blair in his desire to remodel Labour as a capitalist, Thatcherite party. Benn however fully supported nationalization and wished to see it expanded beyond the public utilities and the coal and steel industries nationalized by the Attlee and later governments. This was to be part of a genuine socialist programme to benefit and empower working people. He also argued that this was necessary because capitalism had not produced the benefits claimed by its early theorists, and was simply maintained because it was a useful instrument of class control by the capitalists themselves, particularly the financial section. Benn wrote

The phrase ‘common ownership’ is cast widely enough to embrace all forms of enterprise, including nationalized industries, municipal and co-operative enterprises, which it is envisaged should provide the basis for the control and operation of manufacturing, distribution and the banks and insurance companies.

In practice, Labour programmes and manifestos over the years have focused primarily on the great monopolies of financial, economic and industrial power which have grown out of the theoretical operation of a free market economy. For the ideas of laissez-faire and free enterprise propounded by Adam Smith and carried forward by the Manchester School of Liberal Economists until they reappeared under the new guise of monetarism, have never achieved what was claimed for them.

Today, capitalist monopolies in Britain and throughout the world have long since ‘repealed the laws of supply and demand’ and have become centres of political power concerned principally with safeguarding the financial investors who have lost the benefits of shareholder democracy and the great self-perpetuating hierarchy of managers who run them. For this purpose they control the media, engage in direct propaganda and on occasions have been found guilty of corrupt practices on a massive scale or have intervened directly to support governments that will allow them to continue their exploitation of men and materials for their own benefit. (Pp. 41-2).

This has been thoroughly proved by the last four decades of Thatcherism and Reaganomics. The shareholder democracy Thatcher tried to create through the privatisations of the ’80s and ’90s is a failure. The shares have passed out of the hands of the working class investors, who bought them, and into those of the traditional capitalist middle class. Shareholder democracy within companies has also been shown to be extremely flawed. A number of companies have spectacularly gone bankrupt because of serious mismanagement. The directors put in place to safeguard the interests of shareholders either ignored or were participants in the dodgy schemes of the managers they were supposed to supervise. Furthermore, in many companies while the numbers of workers have been cut and conditions for the remaining staff has deteriorated with lower wages, the removal of workers’ rights and zero hours contracts, management pay has skyrocketed.

And some economists are now turning against the current economic consensus. Ha-Joon Chang’s 23 Things They Don’t Tell You About Capitalism has shown that laissez-faire capitalism doesn’t create prosperity, economic growth and jobs. He still supports capitalism, but demonstrates that what genuinely does work to benefit countries and the majority of their people economically is state intervention. He shows the benefits of nationalization, workers’ participation in management and protectionism. The American economist, John Quiggin, has also attacked contemporary laissez-faire Thatcherite, Reaganite capitalism, arguing very clearly that it is so wrong it’s intellectually dead, but still justified and promoted by the business elites it serves. He calls it in the title of his book on it, Zombie Economics, which has the subtitle How Dead Ideas Still Walk Among Us.

Thatcher’s much vaunted monetarism was effectively discarded even when she was in power. A friend of mine told me at College that Thatcher had quietly abandoned it to try to stimulate the economy instead through the old Keynsian methods of public works. And I can still remember the controversy that erupted in the early ’90s when Milton Friedman announced that monetarism was a failure. The Heil devoted a double-page article to the issue, one page arguing for it, the other against.

Tony Benn was right. Monetarism and the laissez-faire capitalism of Thatcher and Reagan was simply a means to entrench and give more power to the financial class. State intervention, nationalization and proper trade union representation were the way to protect the interests of working people. It’s long past time the zombie economics of the Blairites, Lib Dems and Tories was finally consigned to the grave, and a proper socialist government under Jeremy Corbyn and Bernie Sanders elected in Britain and America instead.

Adolf Hitler on Industry and Nationalisation

I’ve put up several articles making the point that the Nazis weren’t socialists, and that the promoted monopoly capitalism. However, Hitler did not want civil servants or Nazi apparatchiks to have interests in business because of the dangers of corruption. His example was the Danube Shipping Company, a private German firm which massively profited by having sitting members of the Weimar government on its board, who then awarded the company very large subsidies.

Some of Hitler’s views on the question of private industry versus nationalization can be found in his after dinner conversations, recorded by Martin Bormann, Hitler’s Table Talk (Oxford: OUP 1988). Hitler said

I absolutely insist on protecting private property.
It is natural and salutary that the individual should be inspired by the wish to devote a part of the income from his work to building up and expanding a family estate. Suppose the estate consists of a factory. I regard it as axiomatic, in the ordinary way, that this factory will be better run by one of the members of the family than it would be by a State functionary-providing, of course, that the family remains healthy. In this sense, we must encourage private initiative.

On the other hand, I’m distinctly opposed to property in the form of anonymous participation in societies of shareholders. This sort of shareholder produces no other effort but that of investing his money, and thus he becomes the chief beneficiary of other people’s effort: the workers’ zest for their job, the ideas of an engineer of genius, the skill of an experienced administrator. It’s enough for this capitalist to entrust his money to a few well-run firms, and he’s betting on a certainty. The dividends he draws are so high that they can compensate for any loss that one of these firms might perhaps cause him. I have therefore always been opposed to incomes that are purely speculative and entail no effort on the part of those who live on them.

Such gains belong by right to the nation, which alone can draw a legitimate profit from them. In this way, at least, those who create these profits – the engineers and the workers – are entitled to be the beneficiaries. In my view, joint-stock companies should pass in their entirety under the control of the State. There’s nothing to prevent the latter from replacing these shares that bring in a variable interest by debentures which it guarantees and which produce a fixed interest, in a manner useful to private people who wish to invest their savings. I see no better method of suppressing the immoral form of income, based only on speculation, of which England to-day provides the most perfect example. (pp. 362-3).

He also believed that the power industry should be nationalized in some way.

It’s obvious that the power monopoly must be vested in the State. That does not exclude the participation of private capital. The State would offer all its securities for investment by the public, which would thus be interested in the exploitation of the monopoly, or, rather, in the favourable progress of State business. The fact is that, when State affairs are not prospering, the holders of certificates can put a cross through their unearned incomes-for the various affairs in which the State is interested cannot be dissociated. The advantage of our formula would be to enable everyone to feel closely linked with State affairs. To-day, unfortunately, most people are not clear-sighted enough to realise the closeness of this link.

What is true of the power industry is equally true of all the essential primary materials – that is to say, it applies also to petroleum, coal, steel and water-power. Capitalist interests will have to be excluded from this sort of business. We do not, of course, contemplate preventing a private person from using the energy of the tiny stream that powers his small works.

In fact, Hitler was resolutely against profit-sharing and anything remotely like worker’s control in industry. He despised socialism, which he reviled as ‘Marxism’ and the trade unions. They were banned, and their members sent to the concentration camps. In their place was the Labour Front and its councils of trustees in factories, which were there to mediate between the workers and management, and to enforce the authority of the latter.

But Hitler is absolutely right about the problems of joint-stock firms. The Korean economist, Ha-Joon Chang, in his book 23 Things They Don’t Tell You About Capitalism, states that one of the problems with shareholder capitalism is that if the firm appears to be in trouble, the shareholders withdraw their money to invest in a better prospect somewhere else. This exacerbates the firm’s troubles. Those enterprises, which are either wholly or partly nationalized, or which have a degree of worker’s control, tend to be much more resilient as the state and the workforce have a greater interest in maintaining it as a ongoing concern.

As for the nationalization of the power and related industries, that was so obviously needed in Britain that when the Labour party nationalized the electricity and coal industries in late forties there was little opposition from the Tories and the Liberals.

Now Hitler’s own ideas on nationalization are very peculiar. He seems to wish to retain some aspects of capitalism after nationalization by allowing people to buy bonds in them. Or something like that. But when Margaret Thatcher was busy privatizing the utilities and everything else she was able to get her grubby mitts on, one of the leaders of the Labour party at the time also suggested that the party should instead look at schemes of issuing bonds in nationalized industries. This would also combine the perceived advantages of privatization with those of nationalization.

This scheme was suggested at the time when Maggie’s privatization programme was popular, or pretended to be. Her aim was to spread corporate ownership far beyond its traditional narrow base in the middle class, hence her reforms of the stockbroking industry. Britain was to become a capitalist nation of small investors.

This dream came to an end over a decade ago. By the early years of this century the Financial Times reported that the ordinary people at whom Thatcher had aimed her share-ownership scheme, had sold theirs and that all, or almost all of them, were once more back in the hands of major investors. In other words, the traditional, property-owning middle class.

Hitler was a monstrous tyrant, whose party plunged Europe into a war which killed forty millions, and who murdered 6 million Jews and 5 1/2 million non-Jews in the hell of the concentration camps. And it shows how far wrong Thatcherite orthodox economic theory is when even he talks sense about some subjects.

Privatisation has failed. It has failed to provide the investment needed to maintain and expand the utilities and other industries, and instead any profit these firms make now go out of the country to their foreign owners. It’s about time this was ended, and the firms renationalized, with their workers given seats on the board and a role in management.

Andrew Marr Praises Steven Pinker’s Book on Science, Rationality and Free Markets

Mike has posted a number of pieces on his blog commenting on the right-wing bias displayed by Andrew Marr on his Sunday morning show. One recent example of this was his comment to a Tory guest, who came on immediately after he had given a hard interview to someone from the Labour Party. His interview of the Tory was softer, and at the end of it he leaned over to tell her that she had done ‘very well’. Or something like it.

I’m not surprised by this bias. Marr is a fan of the free market, the sacred ideology at the heart of Thatcherism, against which no-one is allowed to blaspheme or question. He was in the I newspaper a few weeks ago praising Steven Pinker’s new book, which argues that the world has got immensely better due to science, reason and markets. Pinker’s a neuroscientist and atheist polemicist. The book’s a successor to his previous work, The Better Angels of Our Nature. This was written to refute the claim that the 20th century was the bloodiest period in human history. This argument has been made in defence of religion, as much atheist polemic is based on the violence and bloodshed that has been generated by religion. But the 20th century is a problem, as the massacres and genocides there took place within an increasingly secular world, and in the case of the horrors committed by Communist regimes, were perpetrated by aggressively atheist regimes. And in the case of the Fascist regimes, it’s questionable how religious they were. General Franco in Spain believed that he was defending Christianity from secularism and materialism when he launched his attack on the Republican government, and horrifically many Christians did support the Fascist regimes against the supposed threats of Communism and Socialism. I’m well aware that Hitler claimed that he was doing ‘the Lord’s work’ in persecuting the Jews in Mein Kampf, but in his Table Talk he has nothing but contempt for Christianity, and wants astronomical observatories set up near schools as part of a scientific campaign against the religion. Hitler’s own religious beliefs seem to have been a kind of monistic pantheism, possibly not that far removed from those of the Monist League, who also sported the swastika as their symbol. As for Mussolini, the Italian dictated signed the Lateran Accords with the papacy, in which the Pope finally recognised Italy’s existence as a state in return for Roman Catholic religious education in schools. But il Duce had started out as a radical socialist, and many members of the Fascist party still were vehemently atheist. Much depended on the religious opinions of the local Fascist ras whether Roman Catholic religious education was taught in the schools in his area. I don’t wish to go into this argument now, whether these regimes were really atheist or not, or if the 20th century really was the bloodiest period in human history. I just wish to make the point that this was the issue at the heart of Pinker’s previous book.

Pinker’s new book apparently tells us that everything’s getting better, including the environment, and Pinker marshals an impressive arrays of facts. But all this said to me was that people and governments have become more ecologically conscious. It does not mean that we aren’t facing the devastating loss of an extraordinary number of this planet’s animal and plant species, or that we face catastrophic global warming which may make the Middle East uninhabitable.

But even more questionable is Pinker’s and Marr’s assertion that modern, post-Enlightenment society has been immensely improved thanks to the science, reason and markets. In the case of science and reason, at one level the statement is obviously true. Human life has benefited immensely from scientific advance, particularly in medicine. But the view that science and reason didn’t exist before then is one that many Medieval scholars would strenuously reject. In contrast to the stereotypes, the Middle Ages actually wasn’t anti-science. There are poems from the 12th-13th centuries celebrating it, and the new knowledge that was flooding into Europe from the Islamic world. The 15th century English poem, The Court of Sapience, lists the various branches of knowledge known to the medieval world, and celebrates them as the area of ‘Dame Sapience’, an idealised personification of wisdom. As for superstition and the occult, historians have also pointed out that the Middle Ages were also an age of scepticism as well as faith. Medieval theologians wrote texts arguing that visions of demons were more likely caused by a full stomach interfering with the correct functioning of the nerves, and so causing bad dreams. Others doubted whether the seers, who claimed to be able to identify thieves through peering in bowls of water or other reflecting surfaces, had any such powers, and were simply using common knowledge to put the blame on notorious thieves. And in contrast to what Marr apparently thinks, free market capitalism did not suddenly emerge in the 18th century with the French Physiocrats and then Adam Smith. In fact, some Christian theologians were arguing for free trade as far back as the thirteenth century.

As for free market capitalism benefiting humanity, the evidence today is that it really doesn’t. The neoliberalism ushered in by Thatcher and Reagan has done nothing but make the lives of the poor much poorer across the world, and in so doing has increased international tension and political violence. The Korean economist, Ha-Joon Chang in his book 23 Things They Don’t Tell You About Capitalism, shows how the strong economies of the world’s developed nations were all created, not by free trade, but by protectionism.

This is very clearly not something any true-blue Thatcherite wants to hear. But it also shows the strange, cult-like nature of the ideology of free trade capitalism. A number of writers have pointed out the apparently illogical, absolute belief its supporters have, even when they are shown the plentiful evidence to the contrary. They still go on believing and demanding free market solutions, even when it is abundantly clear to everyone else that not only do they not work, they are even causing immense harm. And Marr is clearly one of these true believers. He also seems to have uncritically accepted the view that science, reason and free market capitalism were all products of the Enlightenment, when academic historians have been pushing the origins of science and capitalism further back to the Middle Ages, and demonstrated that the Age of Faith was also one of Reason, however irrational it now seems to us.

Marr’s praise of the book and its promotion of the free market also gives more than an indication of his own political beliefs, and why he is much less sympathetic to left-wing guests on his show than those from the right. He’s another member of the cult of neoliberal market capitalism, and this has to be protected at all costs from unbelievers. Even when he and the Beeb swear impartiality.