The following are some personal thoughts from Bill Kerry (a co-founder of The Equality Trust) on General Election 2019.
Following the general election last Thursday, it seems almost certain now that Brexit will happen in some form or other. Perhaps, rather counter-intuitively, this could lead to a revival of progressive politics. When enough people realise that the future for them, their children and their grandchildren is set to be rather grim, the British public might demand change. There is already some hope in that younger people, largely, do not vote Tory and the current prospects for their rather bleak futures mean that is unlikely to change much as they get older. Conservatism will not flourish among a public that increasingly has little or nothing to conserve.
However, I fear the Labour party faces a very difficult challenge whoever the next leader might be. It’s historic power was based on largely homogenous working class communities aided and abetted (and occasionally hindered) by a strata of the middle class that were attracted to the ideas of socialism or social democracy. There was a broad commonality of interests that allowed the construction of a horizontal sense of solidarity across an electorally viable number of people in the country. I think the inequality and poverty unleashed on the country from the 1980s onwards has smashed up that cohesion. Material differences create social distances and everything falls apart. In our unequal, rats-in-a-sack society, we are forced to look after ‘Number One’. Quaint notions such as the common good, community or collective wellbeing take a back seat and we have to live Thatcher’s baleful dream where ‘there is no such thing as society’: only individuals and their families.
The working class still exists (despite siren voices on the right telling you otherwise) as most people still have to sell their labour to survive - but there are very wide variations within the working class in terms of pay, hours, conditions, job security, prospects and pension provision – and, accordingly, wide variations in the ability to plan, get a home and start a family, the things that give people meaning and a stake in society. Both you and the Deliveroo or Uber guy will sell your labour to live, but your worlds are likely very different and your attitudes, values, perceptions, priorities and beliefs will likely be very different too. All the while the top 1% and the top 0.1% soar away, further fraying our social fabric, and are sadly mirrored by the poorest falling away into destitution and homelessness. These conditions are so much worse than even Blair and Brown had to contend with so I don’t think a turn towards centrist Labour politics will guarantee success (you would think a sensible middle option between Blair and Corbyn could be found but if any party can fail to find this sweet spot, it’s probably Labour).
While the sociological foundations of Labour’s horizontal electoral coalition have crumbled a fair bit (not entirely), I would argue that the Tories have better maintained their electoral coalition on the basis of an appeal to nationalism - vertical solidarity if you like, necks craned upwards to the flag and the Queen while kicking down on those below (immigrants, single mothers, people on benefits etc) - a strategy that allows sufficient numbers of people to feel they will be given a chance to maintain, or even advance, their place in our unequal pecking order. History shows that nationalism often trumps (no pun intended) socialism. Before WWI the left parties across Europe all vowed to stop the war because they believed the working class would not fight a capitalist war. That commitment lasted a matter of hours. Thatcher was the most hated PM on record just before the Falklands War with people sporting car stickers that read “Ditch the Bitch” and then after the war she won a landslide. Whether the Labour party likes it or not, there is currently, under our First Past The Post system, an electorally viable constituency (at least 35%+) that can be cohered around a sense of nationalism (although the identity between England on the one hand and Britain on the other is highly fluid and complex). The latest stalking donkey carrying the nationalist agenda is, of course, Brexit.
I don’t have any solutions just a feeling that Labour will now have to embrace constitutional change and a fairer voting system, something it has always - to my intense regret - opposed. I also think part of that will have to be proposals for an English parliament or parliaments (north and south or more?) to address the “English Question” and neutralise that sort of ugly English nationalism which I think is a potentially bigger threat than most nice, middle-class people would like to admit. I would like to see an egalitarian “Federation of the Isles” replace the decrepit, colonial construction that is the Union but if Scotland departs and Ireland unites, I still think the English and the Welsh (assuming they stick around) will still need much greater local and/or regional democracy. Further wishes on my Santa list would be a written constitution, an elected second chamber and an elected head of state (or a Scandinavian-style, bicycling monarchy if we really have to keep them).
There is a consistent anti-Tory voting majority in this country but the electoral system does not allow it to translate into power. It seems impossible for progressive politics to win the game as it currently stands, so maybe we should now work to change the rules.
We need to protest to stop the 'polluter elite' says environmentalist
MFL activist Tom McDonough reports on the recent talk by Dario Kenner at a My Fair London public meeting at Toynbee Hall in July
It can be easy when it comes to environmental issues for my concerns to narrow down to the individual level. Weighed down by guilt, I’m always asking myself how I can do less damage to the planet. I never drive, fly only once every two years, get my plastic, paper and glass recycled, don’t eat meat or use plastic bags or non-recyclable coffee cups and I’ve recently started using bamboo toothbrushes and shampoo bars and shaving bars to cut my plastic waste. Now I’m planning to get all my shopping from “zero waste” stores.
If I’m not looking at my own actions, I’m looking at what my fellow citizens are failing to do. I struggle to understand how people can leave their engines idling while eating fast food or watching movies on their ipads in their cars, how they can allow themselves to get multiple flights per year or come out of luxury shops laden with new plastic bags, all puffed up with pride at their new purchases.
And why are nearly all people present at environmental protests middle class and white? Hasn’t the message that we’re facing a climate emergency got through to the rest of the population?
But talks like the one delivered by independent researcher and author Dario Kenner at Toynbee Hall on 9.7.19, serve as a reminder that the solutions to our environmental woes lie more in challenging our economic elites than in persuading ordinary individuals steeped eye-ball deep in the ‘me, me, me’ consumer culture to change their behaviour.
For one thing, the super-rich do far more harm to the planet through their consumption and investments than the rest of us. Referring to damage done through consumption, Kenner pointed out that in 2013 in the UK, the richest 1% (64,000 people) were responsible for 147 tonnes of Co2 each, while the poorest 10% (6 million people) were responsible for just four tonnes per head.
Judging that wealthy people’s excessive spending habits have been well publicised already, Kenner dedicated more time in his talk to unveiling the harm done through the investments of the “polluter elite”,the wealthy people who run fossil fuel multinationals. For example, BP’s CEO, Bob Dudley, was responsible for 4,307 tonnes of carbon emissions in 2015 courtesy of his 0.008% share in the company, which generated 51,200,000 tonnes of emission that year.
“That’s the advantage of going to the individual level. You can see the motivation behind what they’re doing and they’ll do anything to defend their net worth and status,” said Kenner.
And herein lies the biggest problem of all. The wealthy people and companies running fossil fuel multinationals are doing everything in their power to block a transition to a green economy, using their political muscle to keep us dependent on the energy sources that generate their wealth.
In 2008 the Climate Change Act was passed in the UK, making us the first country to set legally binding targets aimed at reducing carbon emissions. Had we actually adhered to the Act, the UK would have taken a key step towards reducing our role in the global climate emergency.
But in 2015 the polluter elite stepped in to reverse the good work by setting up the Oil and Gas Authority, a body designed to maximise oil and gas extraction in the UK. It was established on the recommendations of a billionaire who made his money from oil services in Aberdeen.
Using a combination of lobbying power and donations, the polluter elite has also prevented us from switching to electric cars and persuaded Government to back fracking and provide oil and gas companies with subsidies.
Meanwhile, UK Governments are loath to challenge the energy companies because our economy needs oil and gas to achieve annual increases in GDP, a useless measure of progress that Governments nonetheless consider vital to their political survival.
The way forwards
The UK’s extreme economic inequality has left us with a club of super-rich polluters who feel insulated and aloof from the problems that affect the rest of us. Given that they’re unlikely to ever do anything that damages their interests and that the Government is unwilling to break free of its dependency on energy companies, the onus is on ordinary citizens to fight for change.
“The polluter elite have proven that they will fight to maintain their status and therefore we need to counter them and the best way to do this is by joining existing protests,” said Kenner.
Only if Government feels pressured by public protests, says Kenner, will it consider taking the kinds of actions that could weaken the polluter companies’ political and economic influence, with one such action being the re-routing of their subsidies to green energy companies.
With the window of opportunity to stop irreversible climate change and species extinction rapidly closing, ordinary people can no longer hide behind our curtains and hope for the best. It’s time to take to the streets.
Dario Kenner's book 'Carbon Inequality: the role of the richest in climate change', is published by Routledge.
Anti-monarchist group hones arguments at members’ day
MFL activist Tom McDonough attended Republic’s members’ day expecting to find common cause with anti-monarchists but discovered their focus is not socio-economic justice.
The gentle rebels
For activists dedicated to overthrowing the Royal Family, one of Britain’s most beloved institutions, the men and women gathered at Republic’sannual members’ day at the NCVO Society Building in Islington, North London, on March 9th, seem like gentle souls.
As committed devotees of Britain’s foremost anti-monarchist campaigning group, they’d probably approve of the Sex Pistols’version of God Save the Queen, but if any of those present had ever been fans of punk, anarchy or revolution they are not showing any clear signs of it now, either in their attire or the comments and questions they direct at the day’s speakers.
“Can you explain more about the Royal Prerogative?” asks one. “We need to understand how the Royal Family came into being,” says another.
And their sensible appearance and measured approach is matched by the moderate tone and pragmatic nature of the demands made by Republic staff and members throughout the day and in their campaigning materials.
Gareth Robson, a 60-year-old private school teacher and Republic board member, is clear that Britain’s republican movement must steer well clear of any notion of revolution or redistribution of the monarchy’s land and wealth.
“If we’re talking about land and wealth..they’re (the Royal Family) only the pinnacle of a massive, horrible iceberg which is the aristocracy and landed gentry,” he says, adding: “But to take it back? I mean, yes, it was appropriated by theft hundreds of years ago if not a thousand years ago, but to take it back now, even in the name of the state, I’m afraid it looks altogether too revolutionary and too much like theft.”
But Gareth, who is sitting at the registration table near the entrance to the main room, is confident that the monarchy will be removed peacefully one day.
“I’m 100% certain of it. The only question is when,” he says.
Either, he believes, the Royals will be gently nudged aside by parliament over the coming decades or they will remove themselves when they see their support-base among the population drop to 50% or below, something he sees as being more likely to happen during Prince Charles’s reign. The third, and in Gareth’s view, least likely and least desirable source of a republican victory would be successful pressure tactics from right wing, majoritarian, anti-establishment forces.
Republic’s anti-monarchy arguments
It’s not just revolution that appears to be far from the minds of Republic staff and members; the corrosive impact of extreme wealth and income inequality also don’t get a mention throughout the day or on the organisation’s website.Read more
My Fair London activist Tom McDonough reports from the 'Speaking to Power' event in London on 19th January, part of the Fight Inequality Alliance's Global Week of Action, as the world's elite met in Davos
Between sets of reggae and hiphop played by DJ Groovemaster Martin at the Speaking to Power event at The Playground Theatre on 19th January, activists and artists from Britain and abroad highlighted the devastating effects of economic and social inequality and called on everyone to join the fight for a fairer future.
Organised jointly by The Equality Trust and The Playground Theatre, the event was timed to mark The Fight Inequality Alliance’s Global Week of Action, an anti-inequality campaign aimed at countering Davos. Speaking about the international campaign Jenny Ricks, Global Convenor at The Fight Inequality Alliance, said: “We are living in an inequality crisis. It affects people very fundamentally in many ways they experience every day - from whether you have decent work, who owns what wealth, who can access decent public services, who experiences violence, and so on in hundreds of tangible ways.”
Income inequality, the prime focus of The Equality Trust and the research that led to the Trust’s foundation, was but one of a broad church of social injustices addressed during the day.
Wanda Wyporska, Executive Director of The Equality Trust, said: “As we have trenchant gender, ethnic minority, disability and class pay gaps we cannot ignore the impact that protected characteristics have on our relationship to the labour market and on income and wealth inequality. These issues are intricately and inextricably linked.”
With the event taking place just minutes away from the burnt out of shell of the Grenfell Tower, the blaze that killed 71 residents of the tower in 2017 inevitably formed one of the focal points of the day.
Grenfell community members, media commentators and campaigning groups, including My Fair London, have argued that the extreme levels of income and wealth inequality seen in Kensington and Chelsea (K&C) and in Britain as a whole had a causal relationship with the disaster.
In “My Grenfell Year”, a short documentary film shown at the event, local residents spoke eloquently about how they’d rallied as a community to support each other and fight for justice in the aftermath of the tragedy. “The fire was the product of decades of silent and invisible violence,” said one of the survivors featured in the film, in an apparent reference to K&C council’s refusal to listen to or respect residents’ concerns about fire risks prior to the tragedy.
Niles Hailstones, a musician and vocal Grenfell community activist, said: “Its (the fire’s) roots were in the culture that was being operated within RBKC for a very long time and still operates today in the same way. That’s not something that can change overnight in terms of how people in positions of power see who we are and what our use is in society because they’ve already set up a structure that keeps us on the lowest rung.”
Reflecting the wide range of issues affected by inequality, the organisers put on a variety of performances including an animated film about living with mental health problems, a poetry reading about global solidarity and a powerful re-enactment of the speech given by Martin Luther King on the eve of his assassination.
In a panel discussion about the culture of putting profit before people Luke Espiritu, Labour Leader at Solidarity of Filipino Workers, said seven billionaires hogged the wealth of the Philippines, leaving 100 million citizens languishing in extreme poverty, with many being reliant on remittances from the ten million Filipinos who workoverseas.
“Seventy per cent of Filipinos are precarious workers. That means they have no security, no minimum wage and no retirement money. Their work is being used by the owners of the business to squeeze profit away. And then when workers go home, they still have to give money to the business man. Why? Because 20% of your income goes to electricity since electricity was privatised in 2001,” he said.
The odds of escaping poverty in the Philippines are now so slim that people are giving up all hope, according to Luke. Illustrating his point, Luke spoke movingly about one of his acquaintances, a teenage Filipino girl, who committed suicide after her efforts to study her way out of poverty came to nothing.
“It’s not about you exerting effort. The entire system is against you. Even if you study well your dreams will be crushed. The future will be bleak unless we band together and fight inequality,” he added.
Fellow panel member Koldo Casla, Policy Director at Just Fair, a charity dedicated to fighting for a fairer UK, said that inequality is a human rights issue.
“The Equality Act 2010 puts a legal requirement on the Government to reduce socio-economic inequality,” said Koldo. “But the Government has simply decided to ignore it.” And it’s not just the Equality Act our Tory rulers have violated. Koldo described how Professor Philip Alston, United Nations Special Rapporteur on extreme poverty and human rights, had slammed UK Government austerity policies in a damning report in November last year. According to Professor Alston austerity has left 14 million people, a fifth of the population, in poverty, with four million people more than 50% below the poverty line, and 1.5 million destitute, unable to afford the most basic essentials.
It’s anti-poor policies like those of the Tory party that have galvanized The Fight Inequality Alliance to press for change around the world. As Jenny Ricks said, “we want to get a big picture message across that governments around the world must listen to their citizens instead of elites at Davos and end the Age of Greed. Privilege and wealth are reshaping economic and social systems at the expense of people as a whole and the planet. Lives and livelihoods are being lost because those who design policies are following a damaging model that privileges elites and corporates over the rest of society.”
Christopher Tajah plays Martin Luther King Jr.
Wanda Wyporska speaking in the debate
MFL activist Tom McDonough writes: “Blade runner society” awaits if inequality increases
Nearly 100 Londoners heard inequality guru and Oxford Geography professor Danny Dorling tell My Fair London's October meeting that Britain’s extreme level of income inequality had peaked. Inequality would have to come down unless we were willing to become a “blade runner society”.
Claiming that history shows income inequality is cyclical, a cautiously optimistic Dorling told London inequality activists that the gap between rich and poor in Britain had last peaked in 1913 and had reached a new upper limit in 2018. “Over the long cycle of history inequality goes up and down and all inequalities eventually come down,” he said, adding that they could either fall fast, as in the case of Japan and Germany, or slowly, as with Holland.
Pointing out that the events accompanying the starts of declines in inequality were not always pleasant, Dorling warned that this new shift towards greater equality may be accompanied by painful social and economic upheavals, with the fallout from Brexit being chief among them.
Income equality increased in Britain from the start of World War One until the late 1970s, when we embarked on a 40 year political and economic experiment that made us what we are today: the most unequal country in Europe and the second most unequal in the rich world, he told the audience. Such abnormally large gaps in remuneration and status between the better and worse off members of our country had resulted in a raft of problems that people could no longer accept.
Illustrating his point, Dorling pointed out that in 2014 the UK infant mortality rate rose and our average life expectancy fell, making us the only country in Europe to experience regression in these key health indicators. “Our education system is the most divided in Europe. Our children are segregated according to an “apartheid” system. It’s not unfair to describe it like that,” he added.
Arguing that we can no longer tolerate the dehumanizing impact of inequality on ourselves and our fellow citizens, he said that grass roots pressure from ordinary people and groups such as MFL would result in a slow, possibly painful, shift towards the more reasonable levels of inequality seen in societies like Finland or Holland.
“Back in the 1930s, twenty years after the previous peak, there was a change in the moral sentiment; it was thought to be wrong to be so greedy when there was so much trouble in the world. The shame is beginning to happen again and we are potentially at that change moral sentiment now.”Read more
London’s housing crisis is a major concern for My Fair London. Below, MFL activist Joan Grant offers an extended review of John Boughton’s new book, Municipal Dreams: the rise and fall of council housing, (Verso, London, 2018)
John Boughton’s book starts by taking us back to a lost world - a world in which a local authority, the London County Council was a major housebuilder. The LCC predated the GLC and was in existence from 1889 to 1965. Its Architecture Department was responsible for many council housing schemes. By the early 1950s it had 1500 staff of whom 350 were architects. In the 1950s, there was conflict between the Swedish Humanists and the Corbusier Brutalists. Brutalism (synonymous with the use of concrete) came to be seen as a way to cheaply build the new welfare state: homes, schools, hospitals and universities from the 60s onwards.
The story of Council housing is a story of a constant struggle between generosity and parsimony in terms of spending on social housing. For 80 years there has been a debate about who council housing is for. Is it for the broad mass of the working population (Labour) or is it only for those who can do no better, with private housing rented or owned always preferable (Conservative).
By the turn of the 20th century, the government accepted that it might have to fund some social housing. The Boundary Estate is the first council estate in London. But there had already been other council housing built in Liverpool. For a couple of years from 1919 when the government pledged to build homes fit for heroes a reasonable amount of money was spent on social housing. In 1921, austerity kicked in and the quality of public homes built began to decline.Read more
MFL activist Tom McDonough reports on our most recent public meeting. Professor Diane Reay spoke to My Fair London on 10th May 2018.
Mission impossible: educating our way out of inequality
Professor Diane Reay explains how England’s education system merely reflects rather than remedies inequality and how it has always failed the working-class.
It’s the rule that matters, not the exception
It would have been easy for someone with Professor Diane Reay’s life-trajectory to hold herself up as a shining example of what can be achieved in an unequal, meritocratic society provided one is bright, aspirational and hard-working. Had Diane adopted such a stance, her tale could have been added to the many clichéd rags-to-riches stories told and re-told by advocates of the American dream and its international equivalents.
Instead, Diane attributes her rise from free-school-meals child to Cambridge professor to family circumstances rather than individual brilliance or aspiration. What makes her story all the more refreshing is her assertion that her parents nurtured her abilities and confidence not by aping middle-class attitudes or behaviours but by fostering within her a pride and belief in working-class values and political perspectives. Shored up by familial support and her strong sense of class identity, Diane passed her grammar school entrance exam and went on to become a successful academic. That her success was achieved within an educational system that has failed most of her class brethren since its inception is a sad fact that has inspired Diane to commit her energies to pressing for educational reform. In her presentation to an audience of My Fair London (MFL) members at the UCLH Education Centre on May 10th, Diane highlighted some of the key points outlined in her book ‘Miseducation – Inequality, education and the working classes.’ Drawing on 500 interviews, the book explains how the education system in England not only fails our working-class children but also makes many of them feel worthless and distressed.
“Education policy is nominally about raising working-class achievement, but its practices achieve the opposite, ensuring that educational failure remains firmly located within the working-classes. Regardless of what individual working-class boys and girls achieve, the collective patterns of working-class trajectories remain sharply different from those of the upper and middle classes, despite 150 years of universal state schooling,” she said.
From flying squirrel to marmots
Our status-conscious and competitive society, argued Diane, is now mirrored in our schools, including the earliest years of our nursery and primary schools. Pupils as young as two are placed in sets or ability-groups, writing themselves off as losers if they are placed at the bottom. In some cases, the sense of hierarchy is heightened by the names used to describe the sets. One researcher told Diane about a primary school that named its sets, from top to bottom, as flying squirrels, tree squirrels, ground squirrels and marmots, the latter living under the ground.
A child named Jason explained to Diane’s research team how the setting system impacts on children like himself, saying: “Some kids they just can’t do it, like they find the work too hard or they can’t concentrate because there is too much going on for them. Then they are put like as rubbish learners and put in the bottom set, and no one cares about them even though they are the ones who need the most help. They should be getting the most help.”
Setting also serves to reinforce class divisions as children end up in sets with other children from their social class. Consequently, rather than remedying the inequalities that exist in English society, our schools merely reflect them, says Diane.
The sharp elbowed middle class
The segregation is worsened further both by the attitudes of sharp elbowed middle-class parents and the measures they take to ensure their children have a competitive edge in exams. The most obvious strategy involves using their financial muscle. Diane’s research found that middle class parents sometimes spend more in a week on private tuition for their children than working class parents have to live on. Meanwhile, children whose parents send them to private primary schools have more than twice as much spent on their early schooling than children whose parents send them to state primary schools. The discrepancy at secondary school level is even greater.
Other strategies include demanding that primary schools prepare their children for exams, campaigning for setting to be introduced, buying properties in areas with high-achieving schools and, if this doesn’t work, lying about their address.
But financial investment is only one and not necessarily the most important advantage enjoyed by better off children. Their parents’ belief in the cultural superiority of their social class and the innate brightness of their children serve to instil confidence in middle class pupils. One study cited by Diane found that 250 sets of white middle-class parents made 254 references to their children being ‘bright’ during their interviews with researchers.
MFL activist Andrew Robert’s reviews George Monbiot’s book ‘Out of the Wreckage: a new politics for an age of crisis’ (published last year) and asks whether, as fairness campaigners, we need to sharpen the way we tell the story of inequality.
In his book ‘Out of the Wreckage’ (published last autumn) George Monbiot presents the political landscape as he sees it. Political narratives drive change, he thinks, and we are now somewhere toward the end of the neoliberalist narrative, which has held sway since it vanquished the previous dominant narrative, Keynesianism. Monbiot asks what’s next?
In answering that question, Monbiot, building on an analysis of political narratives, takes a look at the structure of the neoliberal and Keynesian narratives. He suggests they are mirror images of each other. Both involve a hero defeating a monster; in Keynesianism the state saves us from an economic elite; in neoliberalism the entrepreneur in a free market saves us from the totalitarian horrors of collectivism.
Monbiot posits that the reason the discredited neoliberal narrative has not been finally disposed of is that no compelling replacement has been found. He gives a number of reasons why it’s not possible to simply go back to Keynesianism: political stories have to change, the issues of the 1970s have not gone away; Keynesian growth will inevitably damage the environment.
In searching for an alternative Monbiot points to a growing body of research suggesting that altruism is one of humanity’s unique traits. We show compassion for people we have never met. This, claims Monbiot, is in sharp contrast to the picture presented in the neoliberal narrative, of humanity as inherently only interested in looking after number one.
Monbiot has a number of explanations for our tendency to agree with this false picture of inherent selfishness. Our current leaders often got where they were through sharp elbows – we generalise from them. We are programmed to look out for danger; we are biased to notice bad things (like the Charlie Hebdo killings) more than the good (people taking to the streets in solidarity). And then there are powerful interests who are keen to stress the selfishness narrative.
How to make the most of this altruism? The answer, he thinks, is to empower communities. This can be done in two ways: firstly, creating a participatory culture. One project he cites is Todmorden, where a community garden project has expanded into a number of different projects and these, taken together, have turned the fortunes of the town around. The second is an emphasis on the idea of the commons, that is resources managed by the community. Government could act to recreate the commons by charging a land value tax, with some of the proceeds going to local communities. A citizens’ wealth fund could give a basic income. There could be a Community Right to Buy.
Monbiot is a staunch campaigner for greater economic equality, and his idea of empowering communities could clearly be one mechanism for narrowing inequality, for example through provision of a basic income, or by giving communities much more direct ability to collectively meet housing needs. His analysis perhaps also challenges campaigning groups like My Fair London to reflect harder on whether the story we tell - of the desperate need to reduce inequality - is as fresh, positive and compelling as it needs to be in order to dislodge the neoliberal narrative in people's minds.
Misguided faith: The Guardian's economics editor slams neoclassical economic orthodoxy
My Fair London activist Tom McDonough writes:
Our leaders’ unquestioning faith in neoclassical economics is in dire need of a shake-up, according to the Guardian economics editor Larry Elliot.
Speaking last week to an audience of just under 100 MFL members at the UCLH Education Centre, Elliot claimed that despite its status as an ideologically bullet-proof model, neoclassical economics is in fact not fit for purpose, being unable to avert or even predict economic recessions.
This free market system, made famous in Britain by Margaret Thatcher and endorsed by all British political leaders since, crashed spectacularly in 2008 and is on course to suffer the same fate again, says Elliot. Add to this the model’s failure to factor in its impact on the natural world, its reliance on the provision of credit and its heavy weighting in favour of certain groups and we have a defunct and failing system.
Yet, argues Elliot, the neoclassical economic model has morphed into an ideology whose tenets are seen as so self-evidently correct that anyone who challenges them is considered a heretic or crackpot. Self-regulating markets, privatisation, the shrinkage of the state, free competition, the centrality of financial markets and huge income and wealth inequality are all seen as natural, beneficial and beyond reproach.
The references to faith, ideology and heresy in Elliot’s articles and talks on this topic are reflective of his contention that neoclassical economics has become as dogmatic and as removed from ordinary people as a medieval church.
“It’s become lost in its mathematical thickets and its processes have been mystified. It’s similar to the way the medieval church used Latin to talk in its own language and mystify the whole process,” he said.
In fact, Elliot, together with a group of like-minded economists and students, has likened the call for fundamental economic change to Martin Luther’s instigation of the Reformation of the Catholic church in the 16th century.
Led by economist Steve Keen, this group of economic reformers, Elliot among them, delivered a 33-point call for change to the London School of Economics in December last year. With Keen dressed as monk and carrying a giant inflatable hammer, the stunt was designed to be a humorous re-enactment of Luther’s alleged nailing of his 95 theses to the door of Castle Church in Wittenberg in 1517. The activists targeted a leading university to highlight the need for change not just in economic policy but also in economic thinking, research and teaching.
The 33 points read like a list of the shortcomings of neoclassical economics, with the areas covered ranging from the teaching of economics to the nature of decision making and the role of institutions in markets. Among the flaws highlighted are free markets’ tendency towards inequality. Point 17 acknowledges that people with the same abilities, preferences and talents do not end up with equal levels of wealth owing to differences in luck and circumstances. Meanwhile, point 18 states that unequal societies fare worse across a range of social indicators.
However, while Elliot believes that strong unions, a decent welfare state and lower levels of inequality are all crucial ingredients for a more successful economy, he is no far left egalitarian.
“People are not equal and you can only lean against the wind to a certain extent. In the 1970s the richest used to earn ten times more than the poorest; now the ratio is something like 150 to 1, which is dangerous. It should go back to what it was like in the 70s,” he said.
Where to from here?
If one reason why the badly needed backlash against the economic status quo has not happened is the neoclassical economists’ intellectual and ideological monopoly, a second, argued Elliot, is that it just hasn’t suited the country’s elite to reform it. By contrast, when Keynesian economics faltered in the mid-1970s, after having fostered a golden era of growth and falling inequality, the elite leaped at the chance to restructure the system.
A third reason would seem to be the lack of any viable, clearly defined alternative. The 33 theses do not point to one and while Corbyn’s Labour is seeking to neutralise the worst excesses of current system, it does not set out a vision for an alternative economic model.
Meanwhile, anger levels among the dispossessed are rising as evidenced by the Brexit vote in Britain and the election of Trump in the US. Change is imperative, and the 33 theses are make a decent point of departure, but bold, clearly defined alternatives are still lacking.
Larry Elliot speaking at My Fair London
We are pleased to publish our new pamphlet, on inequality and the economy. In a few pages we try to summarise just how our society, and London, became so unequal over the last forty years. We also set out some of the changes we think are needed to help make our city and our economy fairer for everyone.
We need London (and the UK) to change course, towards a fairer future, where we can all share in the wealth, culture and opportunities that our city can offer. Inequality tears at our social fabric and harms us all, but to change direction we need to change the way our economy is run, and in whose interests. We hope this pamphlet helps make those arguments.
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