12 February 2018

Not All People-Centred Politics is Marxist.

I was looking at an article by a Anarchist this morning. Interesting guy. He reminded me that not everyone on the political left is a Marxist. Socialism predates Marxism, and Anarchists often see Marx as an authority figure to be rejected.

I think Marx's critique of British politics 150 years ago was prescient, but the idea that the British would achieve what the French did in their revolution has always been laughable. The British Class system kept everyone in their place.

Things have changed since the mid 19th Century, of course. Still, class is a major factor in British life. There is still deference to authority here in spades. And of course the Left are deeply divided as portrayed in Monty Python's Life of Brian.

Living in Britain has radicalised me to some extent. Most New Zealanders were socialists - we had a generous welfare state, my education and healthcare were paid for out of taxes. At least until the Neoliberal virus hit us in the mid-1980s. Growing up in NZ did not prepare me for the political right here.

The UK is largely run by people who inherited wealth and therefore power. Britain briefly went socialist post-war but it has lurched to the right since then and seems to be becoming increasingly right-wing. The welfare system has become punitive, university education is no longer free, local councils are going broke. The National Health Service is gradually being strangled by under-funding and is being outsourced to badly governed, unscrupulous private companies who are taking on massive debts in order to keep paying out dividends to shareholders. My local water company paid out more in dividends than it made profits in the last ten years.

And why? So the people who could afford to pay for services could pay less tax. Rich people don't mind paying a premium for personalised services at inflated prices. They do mind paying tax so that everyone benefits.

Another story today, in Forbes, points out that even if Brexit goes very badly, the leading proponents of it in government are so rich that they won't really be affected by it. But they also seem to be deeply deluded about the effects it will have.

It's not that the EU is perfect. The EU has major problems. But I think the key problem for Brexiteers is that Europe is republican and federal. Britain is monarchist and imperial and the ruling classes don't want to give up their power.

British politics is now highly slanted towards the desires of the rich. Our legal and tax frameworks cater for rich locals and rich foreigners as well. We're not even too bothered how they came by their money. No one is really interested in tax reform or tackling tax evasion. We have 10 times as many staff investigating benefit fraud than we do for tax evasion, and the value of tax evasion is 100 times greater. That's symbolic of the orientation of the nation.

As employment levels rise, but pay and conditions continue to be eroded, and workers get further into debt, the demand for goods and services is weak. Consumer spending fell in January. Richard Koo has described a situation in which businesses with debts no longer prioritised maximising profit but instead look to pay down debt. Similarly with indebted households. Eventually they realise that carrying debt is a drain on their resources and they tighten their belts in order to pay down debts.

The thing business people don't seem to understand is that if the workers get too small a slice of the profits of enterprise, they can't buy things. At present the lion's share of profit is going to shareholders and highly paid executives. These people don't pay taxes in the UK, they move their capital off-shore to tax havens, and they don't reinvest their money in the real economy to create jobs or raise wages. They are sitting on vast pots of uninvested cash. All the big tech companies have huge cash reserves for example.

This is not rocket science and it's not Marxism. Capitalism works best when workers are well paid and spend their money on goods and services. The accumulation of unused capital is anti-capitalist.

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