Let’s Talk About: Economic Growth

Images like this mean nothing to Dan Hannan. who prefers to deal with fictional characters than real people and their complicated lives.

Economic growth or just ‘growth’ is the holy grail of career politicians, neoliberal economists and their hangers on in the media. We’re often told how important it is to have ‘growth’ in our economy and it is only then that everyone will see the benefit. The trouble with this notion is that those who continually spout this rubbish aren’t the ones who need to worry. They’re already comfortable. The ones for whom these pronouncements mean little, if nothing at all, are the poor and the low waged. They continue to see their income squeezed, while the cost of living continues to rise. But the media and the government will have none of it.

A few weeks ago, the BBC’s economic editor, Robert Peston, was crowing over low oil prices. He told the nation’s viewers that “everyone” would now feel “richer” because of the continued fall in petrol prices. This is not only misleading; it’s also dishonest. The only people who can feel “richer”, by definition, are the rich themselves. If you are poor, you cannot be “rich”, it’s an absurdity. Yet this does not stop the likes of Daniel Hannan repeating this meaningless tosh. In Thursday’s blog for CapX, he repeated Peston’s bogus claim that “The rich are getting richer and the poor are… getting richer”. This is a measure of how out-of-touch our media and politicians are in relation to the people they purport to serve. We can also draw the conclusion that the mainstream media, the Westminster politicians and economic cults like the Adam Smith Institute and the Institute for Economic Affairs are in a cosy conspiratorial relationship with one another. The relationship between these institutions and ordinary people themselves is one of power. They consider themselves to be the voices of authority and we must listen and obey… or so they think. So when they tell us that “things are getting better” we are expected to believe them. But I no more believe them than I believe in the existence of God, the tooth fairy or Father Christmas. I see no improvement and neither do millions of other people.

The problem with those who constantly talk about ‘growth’ is that they can only speak the language of statistics and mathematics, and can only view the world through the lens of their social status. They are incapable of relating their nutty ideas about economics to the average person because what they’re saying bears no relation to everyday life. Trickle down, for example, is one economic fallacy that is repeated ad infinitum by economic cultists and held up as a model for ‘growth’ and economic well-being. But not even right-wingers like George HW Bush believed it and derided trickle down as “voodoo economics”. Yet the Hannans and Osbornes of this world cleave so tightly to it like men at sea clinging to any bit of flotsam that comes their way.

A couple of months ago, the Labour leadership claimed that if the Tories were re-elected, they would take public spending back to the levels of the 1930s. This was enough to get all manner of right-wing economic cultists into a lather. Hannan was one of those. In this blog, he does his best to claim how the 1930s was a “time of growth”. It’s a risible misrepresentation of a decade that’s become synonymous with economic hardship.

Well, here’s a fact that may surprise you. The 1930s saw more economic growth than any other decade in British history. It’s true that there were patches of deprivation. As in all times of economic transition, some industries declined while others rose. The poverty of the Jarrow Marchers was genuine: theirs had been a ship-building town, devastated by the collapse of international orders.

Sophistry, damned sophistry. For the millions of working class people who struggled to survive the decade, this is an insult to their memory. My mum’s family was Liverpool working class and I can remember her telling me what life was like in the Thirties: if you were poor or low-waged, you had no access to affordable or decent healthcare, because there was no National Health Service (the Tories will abolish it if they are re-elected). There was very little work on Merseyside in the 1930s, so people lived a hand-to-mouth existence.

Hannan continues his fantasy tour of his romanticized past:

Yet these were golden years for new industries such as electrical appliances and aviation and cars, the years when Morris, Humber and Austin became household names. The 1930s also saw an unprecedented boom in construction, as the comfortable suburbs of Betjeman’s Metroland spread across England. The Battersea Power Station raised its minarets over the capital, a symbol of self-confidence in architecture.

Here, Hannan waxes floridly about a world that only those with the economic means could take part. The appliances and cars that he talks about were beyond the means of my family and many others. No working class people owned cars, let alone possessed household appliances. My grandmother was still using a boiler and a mangle well into the 1970s. As for Metroland, the houses that were built there were for sale. Only those with nice, middle class incomes could afford a mortgage.

Here, Hannan slaps more gloss onto his fantasy.

 Britain responded to the 1929 crash by cutting spending drastically and, in consequence, soon saw a return to growth. The United States, by contrast, expanded government activity unprecedentedly under the New Deal, and so prolonged the recession by seven years. Yes, seven years. Here is the conclusion of a major study published in 2004 by two economists at the UCLA, Harold L Cole and Lee A Ohanian:

Cole and Ohanian are comprehensively defenestrated in this blog. Hannan isn’t interested in reality and like all right-wingers of his ilk, he exists in the hermetically-sealed space of privilege. The material of history is bent and twisted to shrink-fit a weak narrative. Like many of his fellow Tea Partiers, he makes the same feeble argument for cuts.

Contrasting the American and British experiences, we are left with an inescapable conclusion. Cuts work, and trying to spend your way out of recession doesn’t.

Let’s put it this way, if a company doesn’t borrow or spend money to invest when it is doing badly, it will go under. Cuts only work for the already wealthy. They are also a means by which the powerful punish the poor for being poor. Hannan makes clear his hatred of FDR and the New Deal. This is the same position held by the economic cultists at the Ludwig von Mises Institute as well as his fellow Randists.

This is perhaps the greatest fallacy of all:

Still, if only for the record, let me set down the real lesson of the 1930. The best way to recover from a crash, not least for low earners, is to bring spending back under control. Growth follows, jobs are created, and the people taking those jobs thereby gain the most secure route out of poverty.

It’s easy for those who have never personally experienced poverty to claim that “the most secure route out of  poverty” is work. Low-paid and zero hours contract jobs actually lock people into poverty. Hannan is not only a fool, he’s a dangerous fool. Leaving people to fend for themselves without a safety net will lead to greater social problems. Hannan is unmoved by such concerns. Yet he would be the first to complain that shanty towns are an “eyesore”. This is the man who calls himself a “Whig”.

Talking about economic growth when people are struggling to survive is deeply offensive. Talking about GDP is meaningless because not only is it a poor way of measuring economic performance, it means nothing to ordinary people. For all his claims of how cutting public spending will improve economic performance, Hannan has never had to suffer the privations of working in a low-paid job. Like all of his pals in Westminster and beyond, he is a bully, who talks a good talk but when his words are unpacked, they reveal the true horrors of the current political system.

Let’s call it what it is: a depression

Are we about to witness the revival of Hoovervilles?

So, place your bets, readers.  How long will it be before some economic guru has the guts to admit that we’re living in the midst of an economic depression? Or is it the case that we’re just hanging around waiting for the next recession to come along, like the London bus of legend: three arrive at the same time and then we can call it a “depression”. So we’ve had two recessions, when’s the next one due [looks at watch]? I’m freezing my arse off!

Recessions, depressions, panics, slumps, credit crunches, call them what you will but they all amount to a failure of the capitalist system. The problem is that no one in authority (and I use that word loosely) wants to stand up and say that “This is a depression”. An economic depression apparently is determined by a sequence and length of recessions but no one wants to agree on the number. That’s because there is no set figure but there was an alleged benchmark to which all future depressions are supposed to aim. We are also told that in order for a recession to be classified as a depression, there needs to be a contraction in economic activity. This is happening now with banks refusing to lend to small businesses.

We are told that the last depression, now referred to as the Great (apparently) Depression of 1929 to 1939 was the longest and deepest depression. But there’s nothing “great” about a depression. This depression was preceded by the Depression of 1920 – 21, which was later downgraded to the status of “recession”. There were also 2 recessions during the 1920s. In Britain, the previous Great Depression of 1873 to 1896 was later called the “Long Depression” and was preceded by the Panic of 1872.

The tale of that period has been told innumerable times: a panic on the stock market and a run on the banks that combined with poor harvests to spawn a series of recessions that resulted in extreme hardship for millions, if not, billions of people around the world.

It was a “contagion” that began in Wall Street and spread around the world like some kind of economic plague. Shirts, jobs and homes were lost in short order. It was a tough time but not for the ruling classes, whose social and economic capital exists in perpetuity… much like the inexhaustible body armour cheat in a console kill game (Medal of Hour, etc). They would survive. They would have to get used to having foie gras only twice a week instead of six until the good times returned (on its high horse).

But could there ever be another depression that matches or exceeds the Great One for sheer, uh, depression? Apparently not. We were supposedly inoculated against further outbreaks of widespread panic… until Callaghan discovered monetarism and the genie was released from his bottle, free to wreak havoc.

The Great Depression has been fixed in the public memory as  a sort of golden age of economic depressions. It has supposedly surpassed previous depressions and panics – each and every one of them devastating in their own right, but ignored for ideological reasons – for its near-total effect on all levels of society. The previous depression has become folklore; its mythology has become the model of perfection against which certain economists and their forecaster allies (sic) judge current and future economic catastrophes.  But why?

Is it because our political leaders (that’s another word I use with caution) lack the intellectual courage to admit the truth of the situation, or is it because they have reached their intellectual limits and lack the honesty to admit that they have no plan for the future of civilization? Could it be because they don’t want to “panic” the public with the admission that the current economic situation is, in truth, a depression?

The issue of mass panic has never stopped them before.

Governments have never been afraid to use fear to coerce the public into accepting their version of the truth in order to prosecute pointless wars, as this clip reminds us.

That’s “good” panic. It’s the kind of panic that protects “freedom” and defends “our way of life”. Today William Hague claimed to have seen “some evidence” that the Assad regime in Syria has chemical weapons. There is a school of thought that believes the only way out of an economic crisis is to start a war. But wars are costly.

Depressions and recessions only ever benefit one kind of person and I don’t need to tell you that person isn’t you or I, dear reader. This is a time when the capitalist sees the opportunity to pit worker against worker. We have already seen how this government uses divide and rule in the way tries to create a false conflict between public and private sector.

This is a depression.

The have been dark murmurings of another recession on the horizon and yet, Osborne continues on his reckless course like a blind ship’s captain, who’s full of Dutch courage after drinking his crew’s rum rations.  But he’s fine. He’s got a wallpaper fortune and an Irish baronetcy to look forward to… not that he isn’t loaded already.

Two and a half years of this government’s bungling has done nothing to give people hope. Instead, prices increase year on year and incomes stay the same for average workers. For many people, there is nothing to look forward to. There is no trust in this government or in Her Majesty’s feckless opposition to put things right either, with disciplinarian Liam Byrne claiming that his party didn’t do enough to clamp down on benefit “cheats”. Trust left town on the same train as hope and it isn’t coming back.

There is a solution to this. It’s just that the ruling class and their lackeys in the media and the think-tanks don’t want to hear it. They have much to gain from economic catastrophes but, potentially, so do we.

More on the Liberty League

No sooner than I’d published this blog than I found myself dealing with three trolls, all of whom claimed to be dedicated to the cause of freedom. I also had three of them respond to me on Twitter, two of whom abused me (typical) and the other, Anton Howes, the League’s head honcho tried to tell me that they “appealed to left-libertarians”, and asked me if

@antonhowes

@buddy_hell spiked +IOI not count as “leftwing” anymore? Besides, orgs not same as ppl who attend our conferences. Many left-anarchists, etc

Spiked? IoI? Left-wing? Same sentence? “Good Lord, no”,  I said but just because they call themselves “left-wing”, it doesn’t necessarily follow that they are. I have already written about the LM network, their origins and their constituent parts in a blog that was cited on Powerbase. Anyone who takes LM’s left-wing credentials at face value is in for a major disappointment.  In fact, the Revolutionary Communist Tendency (the forerunner of the RCP/LM) was expelled from the SWP for being too “right-wing” (sic).

But what is a “left-anarchist”? Is that an anarchist who is not an anarcho-capitalist? Anarcho-capitalism is an oxymoron. Anarchists despise the capitalist system and no anarchist in their right mind would knowingly associate themselves with a network that includes the likes of The Freedom Association or the Institute for Economic Affairs. I told Howes this but I have yet to receive a reply.

Howes also told me that he was a PhD student but it turns out, according to Spiked’s Patrick West (brother of Ed) that he is, in fact, an undergraduate student at Kings College, London. The article was written in March of this year, so it is entirely possible that Howes skipped the Masters degree and went straight for the doctorate. It has been known to happen. He told me,

Anton Howes ‏@antonhowes

@buddy_hell and yes, I’d noticed. Although I’m not ‘rightwing’ at all, it won’t stop me using the terms.

He works for the Adam Smith Institute, you can’t get more right-wing than that. But like so many right libertarians, he presumed me to be stupid. They’re an arrogant bunch.

While not being a fan of Spiked, I found some of West’s article interesting because it shed a little more light onto the Liberty League. West opens in strident fashion.

For decades, university students in Britain who wanted to change the world often had little more than a handful of left-wing groups to sign up to. And, as time has gone on, these radical groups have become more and more outdated and divorced from political reality. Left-wing student associations are now more likely to call for state intervention into people’s lives, embrace the welfare state and demand fewer cuts, rather than fundamentally challenging the state’s role.

Ah, yes, the “left” is “outdated”. So presumptuous and so wrong. if Spiked is left-wing, then this West article puts paid to that notion. The left is marginalized. Yes. The left is divided. That’s true. But these libertarians will not change the world in a way that benefits all of society, they want the same world but with bells, whistles and a fringe on the top. Let’s continue,

Howes recognises this phenomenon. ‘People are sick of seeing tonnes and tonnes of Socialist Workers Party or Marxist groups hounding them on tables outside campus all the time, posting fliers and posters everywhere. They think “well, I don’t agree with this”. Students want to see an alternative group on campus that has pro-liberty ideas.’

“People are sick”, he says, “of seeing tonnes and tonnes of Socialist Workers Party or Marxist groups hounding them on tables outside campus all the time”. Does he ever think students may be genuinely interested in left-wing groups? I mean, it isn’t as if the right doesn’t organize on campuses. It does. They just don’t happen to be popular with a good many students and for very good reasons.  The other thing that is evident in the passage is Howes’ insistence that only his network understands the true nature of “liberty”.

The demand for such a group is coming from a mix of students, says Howes, who place themselves all over the traditional political spectrum, from left-wing anarchists to young conservatives. Liberty League now has 30 active student societies on campuses across the UK and it is rising all the time.

I would be interested in seeing exactly how much “demand” there is for “libertarianism” at, say, a post-1992 university like London South Bank for example. These libertarians are top-down, hierarchical types and if you scratch the surface you’ll find an authoritarian underneath. “Left-wing anarchists” that is to say, real anarchists  would have no truck with this kind of “libertarianism”. Further down the article, I found this,

One enthusiastic Liberty League supporter is Gabrielle Shiner, a young American studying at Queen Mary, University of London. Shiner recounts: ‘When I got to the UK I couldn’t really find any student group to join. It was really disheartening for libertarian students. And then Anton, who I’d never heard of, started tweeting asking me if I was looking to get involved in something and I was really excited about that.’

Later we learn that Shiner is involved in Students for Freedom, a US  student libertarian organization that is part of Cato’s “limited government movement”.  We all know what The Cato Institute does but it seems Howes and his buddies don’t or are lying. I think it’s the latter.

So as we can see, part of the League’s job is to undermine what’s left of the rather ineffective Student Unions. There are some universities that have strong SU’s – University of London Union, for example – the rest are little more than providers of student freebies. The process of destroying the SU’s began under Thatcher, who was concerned that the NUS was a hotbed of student radicalism. Instead, we now have a situation where the Right, led by the Liberty League, are attempting to dominate political discourse on campuses around the country.

The Right – the Conservative Party, especially – is against political activity on campus unless it is either right-wing or “libertarian”. This is the reason why the Thatcher government wanted SU’s to disaffiliate; it hated the very idea that students chose left-wing politics over the right. It felt that by eliminating left-wing political discourse on most campuses and confining it only to Oxbridge and other Russell Group universities, it would destroy left-wing politics in Britain for good. It nearly worked.

Anton Howes ‏@antonhowes

Pretty disgraceful that @libleague society being discriminated against by Manchester SU in terms of funding, for not backing Demo12

This is pretty typical of the Right. I know how hard it is to set up and run a society but in terms of funding, the SU will only match the membership money and any other monies that the society has raised in its coffers. I get the feeling that the League wanted more than its fair share. But this tells us something else about the Lib League: they support cuts to higher education and regarded Demo12 as something that  only “lefties do”. They are above protest unless it’s to demand more cuts to public services. I wonder how many of them attended the disastrous Rally Against Debt last year?

The one thing that I left out of the original article about the Liberty League was its campus network. If you look at the list, you’ll see one called the LSE Hayek Network. There’s nothing “non-partisan” about Hayek, the great guru of neoliberalism, he is most certainly right-wing and was a supporter of Pinochet’s economic liberalization. You see, economic liberalization can only be forced onto people. If given the choice people would reject it without a second thought.

Right libertarians seek to perpetuate the notion of the importance of the sovereign self over society. Please the self, pamper the self, flatter the self, the self is king. This is the atomized society that Thatcher spoke of; one that is bereft of communities. Our society is in tatters, wrenched apart by the spoilt brat of the sovereign self.

If you inculcate the notion that the individual is more important that the rest of society, before you know it, people will begin to see themselves less members of society but more as consumers at the end of a long supply chain. Individualist anarchists fit in well with Objectivists or Randists, because they place the self at the centre of the universe.

Right libertarians speak movingly about freedom but, as history has shown us, they are more than happy to collaborate with fascists or military strongmen (the  Italian Futurists, for example, described themselves as “anarchists” and joined Mussolini’s fascist government). Anarchists, on the other hand, fight fascism and all forms of authoritarianism. The right libertarian would happily watch as the cops beat the shit out of you for protesting against an authoritarian state.

Cato supported the Pinochet dictatorship. Jose Piñera, the architect of Chile’s private pension system and former Chicago Boy is a “senior fellow” at the Cato Institute. That’s right libertarianism for you.

POSTSCRIPT

Not “right-wing”? The Tories don’t think so.  Last year, Conservative Home heaped praise on the Liberty League.

Here’s a revealing paragraph (I’ve bolded a bit for emphasis),

This work was started by Simon Richards, Director of The Freedom Association, with his vision for ‘Freedom Socs’. There are now five such societies, the first of which launched at York three years ago. In addition to this, there are a large number of libertarian societies, which spontaneously popped up around the country. The Liberty League enables these individual groups to be part of a cohesive network and acts as a gateway for young freedom lovers in the UK.

Bingo!

Mediating freedom: the role of the libertarian think-tanks

Madsen Pirie: the architect of Thatcher’s privatization programme

How does one define the word “freedom”? There is a group of people who believe they know exactly what the word “freedom” means. “Freedom” and its cousin “liberty” are abstract nouns, there is no hard and fast definition for either of them and any attempt to give them some kind of single meaning or, indeed, a list of meanings is utterly futile and is most likely going to be dishonest. Moreover, it could take you a very long time to compile such a list.You can no more easily define “freedom” than you can words like “happiness” or “love”, because these words mean different things to different people at different times.

There are people who believe that they have knowledge of the true nature of freedom. They form themselves into ‘non-partisan’ think-tanks’ and discussion groups and refer to themselves collectively as “libertarians”. It’s as if as libertarians, they and only they have found the true meaning of freedom. It is as though they had heard the word of G*d Himself who spoke unto them and revealed the secret of liberty.  He said unto them, “It is not Communism”.

And lo, it became the everlasting Truth… until the collapse of the Wall of Berlin, when the disciples of The Truth believed unto themselves that freedom had triumphed over the tyranny of Communism, which they declared to be “unfreedom”.

After some soul-searching and not an inconsiderable amount of hand-wringing, they decided among themselves that unfreedom was to be represented by so-called radical Islam. They had found their antithesis! Lazy thinkers are attracted to binaries because they can only define themselves against their opposite. They are not Communists/Socialists/Lefties/Islamists, therefore they love freedom!

Those who call themselves “libertarians” deny that they are of a right-wing disposition and will gather at the feet of some economic guru or high priest, where they receive The Word directly from the master’s mouth. They may also deny that they are ideological and claim that they are “non-partisan” or “neither right nor left” but this is dishonest for when you press them on certain matters, they will produce a reply that contains the usual messages of “responsibility” and a “small state”. They speak in maths. Society is merely an afterthought.

Classical liberalism, as a term, has become both a touchstone for nostalgists and means by which to reorder language. Even neologisms are subjected to this transformation. The term “neoliberalism” is resented by the Right because they did not coin it. In its stead came “classical liberalism”, a term made seemingly older by the prefix “classical”. It is still neoliberalism in form and in substance. We cannot return to the past, no matter how hard the Tories try to recreate the past in the present. Therefore they revive old terminologies and long for the days before they were born.

The economic theories embraced by the Adam Smith Institute (ASI), for example, are most definitely on political right and are therefore ideological. There’s no escaping it. In the 1980s, the ASI was very close to the Thatcher government. To whit, ASI’s president/high priest, Dr Madsen Pirie was  the architect of privatization. His freedom is that which steals food from the mouths of babes and condemns the poor to lives of never-ending serfdom.

Right libertarians believe themselves to be the arbiters of the freedom ideal. Their idea of freedom is a mediated one. That is to say, it comes from someone else or is produced by a body of people like ASI who make a deterministic argument of freedom, based more or less on the notion of economic liberty, which they assert is the fount of all freedoms. Such thinking is absurd when one considers the tyranny exerted on the poor and working poor by states that have operated this model.

For neoliberalism or classical liberalism to work, it must be imposed on the citizenry. These economic ideologies can only benefit the rich and any claim that they will “liberate” the poor is patently absurd and is not supported by the evidence. “Trickle-down” is a lie.

The ASI, like so many other libertarian think-tanks have convinced themselves that they know the True meaning of the words “liberty” and “freedom” but it doesn’t and to claim that it has a form of superior knowledge that leads them to a position where they can provide a definitive meaning for these words is arrogant, mendacious and self-delusional. Have a look at this pamphlet from the ASI, from which I shall quote a portion,

Liberty can be defined as not being interfered with, or not being
imposed on, by others (non-invasive liberty). Not being attacked
or robbed is part of liberty; attacking or robbing people is not part of liberty.

It follows that liberty means being able to do what you like with
your own body (the principle of self-ownership) and your own
property, as long as you are not thereby imposing on the body or
property of others. You are free to harm yourself, for example by
taking dangerous drugs, but if you harm someone else or damage
their property without their consent, you are violating their liberty.

This sense of liberty is what libertarians, or classical liberals,
mean when they advocate liberty. It is also the dominant idea of
liberty within Western history and it applies to any society that is
described as generally ‘liberal’.

This is a mainly Hobbesian formulation of liberty that has been infused with neoliberal discourse (Hobbes was a supporter of absolute monarchy). But to characterize liberty in purely Western terms is misleading and rather vague since it presumes that freedom does not exists outside Western ‘liberal’ discourse. It also suggests that “liberty” was conceived by Westerners, ergo they are the arbiters and owners of the “freedom” concept. Furthermore the essentialistic arguments on the nature of freedom put forward by the ASI is only one set of definitions and can never represent a totality of freedom, because there will always be limits or disagreements.

The Freedom Association (TFA) is a right-wing pressure group, whose idea of freedom is narrow. Indeed, its name is Orwellian. I can think of no group that calls itself The Love Association or UK Happiness League.  No one can tell you what constitutes  love or happiness. If I were to ask you to sum up what the word “love”  in a few words, you would tell me one thing. If I were  to come back to you in a couple of months and asked the same question, you may have a different answer for me. No one can tell you or I what love is; it is dependent upon one’s individual perception of that word at a particular moment in time.  You could say that love is not hate. But then, what is hate?

The idea of freedom put forward by ASI or TFA is a spectacular one, precisely because it has been mediated. These groups have set themselves up not only as arbiters of liberty but have hijacked the discourse on the subject. It stands to reason that those who accept the ASI’s and TFA’s definition of freedom as Truth, do so because it emphasizes their relationship to capital. If you do not accept their kind of freedom, then you are a supporter of unfreedom; a totalitarian. It’s as simple as that.

When the government announced it was going to “measure” the nation’s “happiness”, I was suspicious and rightly so, you cannot measure, let alone define, happiness. It was a government attempt to manipulate people’s emotions. Nothing more. Nothing less.

In George Orwell’s satire, 1984, he created a dystopian world in which ignorance was a virtue and in which the state created ministries with names like the Ministries of Truth and Love. He was onto something.

There was some  Situationist graffiti that once said, “Don’t liberate me, I’ll take care of that”. That is my motto.

What is the Liberty League?

This is your freedom, you can’t afford the other kind.

If it’s one thing that the Right loves to do, it’s to lecture the Left and anyone who’ll listen on the nature of freedom. They’ll wrap their semi-feudal ideas in economic jargonese and present them as unassailable truths, telling anyone who dares to disagree with them and their muddle-headed views that they “hate” freedom. They would deny that they are superstitious but their unquestioning belief in The Invisible Hand of the Market is naive at best and dangerous at worst. It’s another way of saying “We’ll just let the Lord decide this one, shall we”?

I only came across the Liberty League fairly recently and as is always the case with groups that use the word “liberty” or “freedom” in their name, they work to deny others of their freedoms. As it turns out, the Liberty League is not the name of one particular organization but an umbrella name for a network of, some would say, the usual suspects but with one or two names added. At first glance it would appear that they have taken their name from the American Liberty League, an anti-New Deal group of businessmen who were involved in the alleged Business  Plot of the 1930s, but they haven’t.

Have a look at this list, you’ll see some familiar names and some not-so-familiar names. One such name is the Legatum Institute, whose parent company is Legatum.  I can tell you that Legatum is based in Dubai, that free-market paradise in which migrant workers from places like India and Pakistan are treated appallingly. Legatum is an international investment company that was founded in 2006 by New Zealander, Christopher Chandler, who was president of Sovereign Asset Management. It has also created The Legatum Center at the prestigious Massachusetts Institute of Techonology or MIT.

The Legatum Center for Development and Entrepreneurship was founded on the belief that economic progress and good governance in low-income countries emerge from entrepreneurship and innovations that empower ordinary citizens.

The Center was founded at the Massachusetts Institute of Technology in 2007 through a multi-million dollar gift from Legatum, a global investment firm.

The Legatum Institute has something that it calls its “Prosperity Index”, which it says

is a unique and robust assessment of global wealth and wellbeing, which benchmarks 142 countries around the world in eight distinct categories: Economy; Education; Entrepreneurship & Opportunity; Governance; Health; Personal Freedom; Safety & Security; and Social Capital.

I had a look at the first video and was led to this site, which gives details of how they measure “prosperity”. It also ranks countries in order of their relative “prosperity”. Some countries don’t figure because of “insufficient data”, these are countries like North Korea and Somalia. The colour green indicates “high prosperity”. Guess which countries are listed? You guessed it. The UK, USA and all the Northern European countries plus Australia, New Zealand, Japan the UAE and some others.

While this all sounds rather reasonable and indeed plausible, the fact that Legatum is part of this Liberty League says more than their charts or their methodologies could ever say. Rest assured that when it comes to prosperity, it is clear that they’ve ignored certain factors in order to advance a thesis of ‘liberty’ through laissez-faire capitalism. The UK, for example, is by all accounts, not as socially mobile as Legatum would have us believe. Social capital plays a large part in how power is exercised politically. Those who possess the social capital inherited from aristocratic, landed families and the rest of the old establishment is not considered in the analysis. Money in Britain stays with the same group of people. Prosperity exists for some and not for all.

Freedom, contrary to the claims of the Right, cannot be measured by a set of indicators or benchmarks. Freedom is much more personal and is arguably a more a state of mind than a word or a set of principles that have been decided upon by the high priests of this economic cult or that. No matter how many times they’d like to tell us, capitalism is not congruent with freedom.

The President and CEO of the Legatum Institute is Jeffrey Gedmin, a former president of Radio Free Europe/Radio Liberty, the international charm arm of the US Congress (it was funded by the CIA until 1972) that once beamed music and messages of “liberty” to the so-called Iron Curtain countries has now turned its signal towards Iran, Central Asia and the Middle East. Gedmin was also a resident “scholar” with the American Enterprise Institute, a neoconservative think-tank that boasts the talents of Richard Perle, who was one of the principal architects of the Iraq Invasion. The use of the word “scholar” to describe these people is flattering to say the least.

Legatum also organizes Democracy Lab, which appears to be part of its magazine, Foreign Policy.  Here’s the Facebook page for Democracy Lab. It tells us,

Democracy Lab covers the political and economic challenges facing countries trying to make the transition from authoritarianism to democracy.

Why do I get the feeling this has nothing at all to do with democracy? Since the collapse of the Berlin Wall over 20 years ago, neoliberals have have rushed into the former Eastern Bloc countries in their droves. The economic vacuum that was created in the wake of the collapse of European Stalinism was the ideal opportunity for groups like CATO and others to reshape these nations into model free market economies. They have done this through a network of economic think-tanks and pressure groups that share the common goal of free market capitalism. The new leaders of these countries were the antithesis of their predecessors, and threw themselves lovingly into the arms of neoliberalism’s carpetbagger-priests.

The University of Bath Tobacco Control Research Group has a site called “Tobacco Tactics” that “aims to provide up-to-date information on the Tobacco Industry, its allies or those promoting a pro-tobacco agenda”. It lists the Liberty League as one of those groups that acts as front for the tobacco industry.

Back to the Liberty League. They have six staff, all of whom look at though they’ve just walked out of university. Interestingly, two of them have degrees in War Studies.

The site says that three of its staff, Will Hamilton, Anton Howes and James Lawson, are members of the Adam Smith Institute’s (ASI) “Next Generation Project”. But the link is dead. However I have discovered Pete Spence, Operations Manager for the League is one of the project’s “key people”.

Pete Spence is Programmes Officer at the Adam Smith Institute, responsible for overseeing the ASI’s events and student programmes. He holds a BSc in Economics from the University of York.

Pete’s policy interests include agricultural policy, opposition of corporate welfare and internet freedom.

Away from work, Pete enjoys weight training, live music and volunteering as Operations Manager for the Liberty League.

Ah, so he’s only a part-timer at the League? This straddling of two or more groups is quite common. We should remember that Dan the Han is involved with Young Britons’ Foundation (YBF) and TFA. The YBF is, for all intents and purposes, the continuity Federation of Conservative Students.

The Liberty League has invited the Institute of Ideas (IoI), who are part of the LM network to join. Liberty, the civil liberties pressure group, has also been invited. The IoI produces propaganda in the form of ‘scholarly’ research for global pharmaceutical companies and agri-business companies like Monsanto.  The IoI has shared a platform with the League at their “Freedom Forum” events, which were also attended by The Institute of Economic Affairs, Spiked, TFA, Big Brother Watch and Liberal Vision. The latter is formed of Orange Book Lib Demmers.

This is liberty, dear readers. It’s the liberty of corporations and feral capitalists to exploit others for profit. It’s the liberty that holds most of humanity in bondage to the markets.  In other words, it’s an Orwellian idea of liberty.

Ethics, morality and the right’s economic arguments

Gordon Gekko: patron saint of greedy bastards everywhere

“Greed is good” was the quote attributed to the character Gordon Gekko in the film Wall Street. But he never said those words, this is what he said,

Greed, for lack of a better word, is good. Greed is right. Greed works. Greed clarifies, cuts through, and captures, the essence of the evolutionary spirit. Greed, in all of its forms; greed for life, for money, for love, knowledge, has marked the upward surge of mankind and greed, you mark my words, will not only save Teldar Paper, but that other malfunctioning corporation called the U.S.A

As you can see, the sentiment that “greed is good” is contained within the speech. Perhaps the most revealing part of that speech is the phrase “evolutionary spirit”. In other words, the form of capitalism that is currently  being practised is a form of social Darwinism.

Greed is a highly-regarded character flaw among the neoliberals who currently dominate economic discourses. They will tell us that those who salt their vast sums of money away into off-shore accounts are “wealth-creators”, not tax-dodgers who pay their employees peanuts and who continue to rake in vast profits while paying no corporation tax.  As we know already, this newly-coined phrase “wealth-creator” is indicative of an ongoing effort on the part of a group of pathological liars to convince us that it is in our best interests to cut our throats for the benefit of these parasites and, indeed, the nation. These wealth-creators create wealth but only for themselves. You and I will see not a penny of it.

It says a great deal about the morality of the right when they tell us that greed is “natural” and that it should be encouraged. Hayek, whose word is holy writ among neoliberals and the mendacious, self-delusional ‘classical liberals’, rationalized greed as something inherent in our make-up, which therefore meant that the small state should do all it can to facilitate it. No planning. No regulations. Just pure unabashed greed would benefit us all, he alluded.

We don’t praise or celebrate murder nor do we sanction murder as a good thing unless it has been given license, as in the case of war for example, where murder is regarded as a good thing, because it is in the “national interest”. People get medals for murder.  The greedy are rewarded with bigger tax cuts and knighthoods for their ‘risk taking’. The aftermath of the Iraq invasion showed us how both murder and the clever justification for greed could be used as a means of social control and a means to cart loot out of the country under the effective guise of the “free market”. “It isn’t greed” they’d tell us. “This is freedom”!

But why should we praise anyone who is permitted to give full expression to their greed? We don’t praise murderers unless, of course, they wear medals. Should we also allow those who burgle their neighbours to carry on because they’re showing ‘entrepreneurial spirit’? That’s another slippery concept: entrepreneurialism.  What is it? Is Grant Shapps an entrepreneur? Some, his fellow Tories, would think so. I say that he’s a crook and a parasite.

The trickle down theory has been thoroughly discredited. Even George Bush Sr had his doubts when he called it “voodoo economics”. Yet this government and its Lib Dem human shield persist with this notion that only greed can save us from our economic woes. Instead of clamping down on the cheats, they are given ever greater license to rip us off.

I find it bizarre that some of these greedy people would describe themselves as Christians but doesn’t the Tenth Commandment advise against greed? I do believe it does.

What Hayek and his acolytes propose is nothing less than a form of economic natural selection. Those that have money will survive and carry on exploiting others, while those without will either die or will otherwise be enslaved by the greedy.

Greed is no more natural to us than spree-killing. We don’t tolerate spree-killers, why should we tolerate greedy capitalists?

Ron Paul and “Austrian Economics”

Ron Paul, the self-styled libertarian,  has declared that we’re all Austrians now.

It was a particular strain of Austrian economics that helped to create the global economic situation we’re in today and yet, Paul wants more of the same. But his love of “Austrian Economics”  goes far beyond the black and white world of so-called free-market economics.

The variety of Austrian economics that we are most concerned with here is not the Hayekian strain (he digs Hayek too) but the Misean strain as promoted by Lew Rockwell and the Ludwig von Mises Institute, the neo-Confederate think-tank that rationalizes the Civil War as merely an unnecessary “tariff war” and declares the Emancipation Proclamation and all the legislation that stems from it to be an abomination. Paul thinks slaveowners were cheated out of their right to own slaves by the cruel North. He also believes that the Civil Rights Act stripped away a person’s freedom to deny service to someone on the grounds of their skin colour. It’s all about “state’s rights”, see?

There’s a good story from Paul Rosenberg  on the Al-Jazeera site here.

So when Paul talks about Austrian Economics, he does so safe in the knowledge that most Americans have no idea what he’s talking about. Many people find his brand of libertarianism attractive and can’t help but feel drawn to it. That’s understandable.  It’s a little like finding yourself humming along to a catchy pop tune but don’t know the name of the song or the person who is singing it.

Memo to Dissembling Dan and his rich chums

Today in the Torygraph, Dan Hannan has written some pure drivel about #OccupyLSX. Apparently he went down to St Pauls Cathedral to have a “chat” with the camp and to try and convince them that he is right and they were wrong (he’d tell you otherwise). Today he’s produced what he’s called his “Memo to the Occupy protesters: here are ten things we evil capitalists really think”.  Here’s what he says.

1. Free-marketeers resent the bank bailouts. This might seem obvious: we are, after all, opposed to state subsidies and nationalisations. Yet it often surprises commentators, who mistake our support for open competition and free trade for a belief in plutocracy. There is a world of difference between being pro-market and being pro-business. Sometimes, the two positions happen to coincide; often they don’t.

Well, that may be the case but it’s your version of capitalism that’s destroying us. By the way, there is no such thing as free trade.

2. What has happened since 2008 is not capitalism. In a capitalist system, bad banks would have been allowed to fail, their profitable operations bought by more efficient competitors. Shareholders, bondholders and some depositors would have lost money, but taxpayers would not have contributed a penny (see here).

Wrong, Dan, it is capitalism. You certainly can’t describe it as ‘socialism’.

 3. If you want the rich to pay more, create a flatter and simpler tax system. This is partly a question of closing loopholes (mansions put in company names to avoid stamp duty, capital gains tax exemption for non-doms etc). Mainly, though, it is a question of bringing the tax rate down to a level where evasion becomes pointless. As Art Laffer keeps telling anyone who’ll listen, it works every time. Between 1980 and 2007, the US cut taxes at all income levels. Result? The top one per cent went from paying 19.5 per cent of all taxes to 40 per cent. In Britain, since the top rate of income tax was lowered to 40 per cent in 1988, the share of income tax collected from the wealthiest percentile has risen from 14 to 27 per cent.

Simpler tax system? Yes. Progressive tax system? Yes. Flat tax? No, they only benefit the rich. The Poll Tax was a flat tax. Those on lower incomes had to pay the same amount of tax as those people drawing down 6 figure salaries. This is dishonesty but then, this is what I have come to expect from Dissembling Dan. Another thing that Dan doesn’t mention about Art Laffer and Reaganomics is that millions of Americans lost their jobs and many more suffered as a result of the new tax system. Far from reducing overall debt, Reagan actually managed to create more debt. As for “closing loopholes”, the Tories will make the right noises but will fail to act. They don’t want to bite the hand that feeds them.

4. Those of us who believe in small government are not motivated by the desire to make the rich richer. We’re really not. We are, in most cases, nowhere near having to pay top rate tax ourselves; our most eloquent champions over the years have been modestly-paid academics. We believe that economic freedom will enrich the country as a whole. Yes, the wealthy might become wealthier still, but we don’t see that as an argument against raising living standards for the majority.

The motivation behind the movement to create a “smaller” government is to protect the interests of capital, thereby making the rich richer. Night watchman governments will exist only to rubber stamp the diktats of corporate interests and to use force against those who act against those interests. Just have a look at Chile, then magnify that by 2.  By the way, Dan’s rich.

5. We are not against equality. We generally recognise the benefits in Scandinavian-style homogeneity: crime tends to be lower, people are less stressed etc. Our objection is not that egalitarianism is undesirable in itself, but that the policies required to enforce in involve a disproportionate loss of liberty and prosperity.

This is contradictory. Here, Dan says that he is not “against equality” but then ends by saying that egalitarianism will result in a ” disproportionate loss of liberty and prosperity”. What he doesn’t say is that he’s worried that his class – the ruling class – is scared of losing its privileges; the privileges that it assumed for itself as a result of exploiting others who are less privileged.

6. Nor, by the way, does state intervention seem to be an effective way to promote equality. On the most elemental indicators – height, calorie intake, infant mortality, literacy, longevity – Britain has been becoming a steadily more equal society since the calamity of 1066. It’s true that, around half a century ago, this approximation halted and, on some measures, went into reverse. There are competing theories as to why, but one thing is undeniable: the recent widening of the wealth gap has taken place at a time when the state controls a far greater share of national wealth than ever before.

Here, Dissembling Dan seems a bit confused. He’s mistaken his hat stand for a hat. Comparing the present day to 1066 is like comparing apples with oranges. When he says, “Britain has been becoming a steadily more equal society since the calamity of 1066″, I wouldn’t expect to be struggling under the same brutal feudal system that the Normans imposed on the country but, at the same time, the last vestiges of feudalism remain – particularly with regards to property and common ownership of the land. He could have easily said that “Britain has been becoming a steadily more equal society since 43” or since the so-called “Glorious Revolution”. Utter nonsense.

7. Let’s tackle the idea that being on the Left means being on the side of ordinary people, while being on the Right means defending privileged elites. It’s hard to think of a single tax, or a single regulation, that doesn’t end up privileging some vested interest at the expense of the general population. The reason governments keep growing is because of what economists call ‘dispersed costs and concentrated gains’: people are generally more aware the benefits we receive than of the taxes they pay

In this paragraph, he tries to deflect attention away from the way the right (the Tories) protect their interests through the use of legislative mechanisms. Not content with hammering the low and medium waged by demanding that they work more hours for less money, the Right also attacks their culture. There are many examples of this: The Six Acts, The Licensing Act (1737), The Criminal Justice and Public Order Act. Since the Tories came to power in 2010, they have moved swiftly to carve up the rest of the welfare state (in spite of having no mandate to do so). Top of their list is the NHS, an institution that is despised by our Dissembler-in-Chief and which they want to privatize. Remember this?

8. Capitalism, with all its imperfections, is the fairest scheme yet tried. In a system based on property rights and free contract, people succeed by providing an honest service to others. Bill Gates became rich by enriching hundreds of millions of us: I am typing these words using one of his programmes. He gained from the exchange (adding fractionally to his net worth), and so did I (adding to my convenience). In a state-run system, by contrast, third parties get to hand out the goodies.

This has come straight from Ayn Rand’s dead mouth. She said that capitalism was the “only moral system”. When Dan says that capitalism (or rather his variety of capitalism) is “the fairest scheme yet tried”, he does not mention other “schemes”. Doubtless, he has in mind the economic system of the USSR, which was not socialism at all but a bureaucratic form of capitalism. Furthermore, Bill Gates has not “enriched” me or anyone else. That’s bullshit. He enriched himself and then turned into a present-day Victorian philanthropist. Was it a sense of guilt on Gates’s part? Maybe. If it was guilt then some of this nation’s rich could do with a dose of that guilt and start paying higher taxes.

9. Talking of fairness, let’s remember that the word doesn’t belong to any faction. How about parity between public and private sector pay? How about being fair to our children, whom we have freighted with a debt unprecedented in peacetime? How about being fair to the boy who leaves school at 16 and starts paying taxes to subsidise the one who goes to university? How about being fair to the unemployed, whom firms cannot afford to hire because of the social protection enjoyed by existing employees?

What on earth is he talking about? Fairness “doesn’t belong to any faction”… what does that mean? Nothing. Here it would appear that he was running out of ideas to fill up his list of ten. These examples of ‘unfairness’ are nothing more than diversions. Riding in the slipstream of these thoughts are education vouchers and a two-tier health service.

10. Let’s not forget ethics, either. There is virtue in deciding to do the right thing, but there is no virtue in being compelled. Choosing to give your money to charity is meritorious; paying tax is morally neutral (seehere). Evidence suggests that, as taxes rise, and the state squeezes out civic society, people give less to good causes.

More Randian drivel. The subtext here is that charities won’t be able to do good works if we have a more egalitarian economic system.

Well, there you go, comrades. I don’t expect the tents outside St Paul’s to fold overnight. But perhaps we might at least engage honestly on some of these issues rather than talking past each other. ¡Hasta la victoria siempre!

I’m not your comrade and you have signally failed to engage honestly.

Hannan would claim that the occupiers don’t have any ideas or that they don’t have an argument. What Hannan isn’t going to do is listen and take on board ideas, especially if those ideas don’t intersect with his barmy brand of  neoliberalism. For him, a Randian world of unfettered capitalism and shrunken states is the path to ‘freedom’.  Yet, history shows us that when capitalism is unregulated it leads authoritarianism because the state acts only to protect the interests of the capitalists, many of whom enjoy exceptional privileges under the iron rule of the caudillo.

Dissembling Dan’s preferred version of capitalism has already been imposed on the people of  Chile and now his government want to complete the neoliberal project that was started under Thatcher.

Far from having no ideas, the Occupy movement has shown that it has more ideas than our current government (and Dan Hannan), who want more of the same.

Those who don’t learn from history are doomed to repeat it

Behind the rhetoric (Part 1)

The Right says

“We want to create wealth”.

The bit they left out,

“For ourselves”.

The real road to serfdom

So the credit rating agency, Standard & Poor (great name) has downgraded the US’s credit rating from AAA to AA+. Do you know what this means? No? Because I don’t either. Does it mean that the US will have its credit card taken away and sent to the naughty step?

Is it me or is this whole process of credit rating  nations a little simplistic? I remember when Thatcher compared Britain’s economy to to a domestic budget. It was silly and reductive then and it’s silly and reductive now. It provides an instant rationalization and a justification for spending cuts and job losses.

Viewing the world in such simplified terms can only lead in one direction: disaster. The global economic meltdown is partly a product of lazy thinking as well as inveterate greed.

The world and its economies are much more complicated than the world’s politicians are prepared to admit. Credit rating agencies are merely an arm of enforcement that works on behalf of the banks and other financial institutions.

The US can thank the sociopaths in the Tea Party for its downgrade. It can also thank them for nearly bringing the world to its knees. I get the feeling that they won’t be happy until we’ve all returned to a feudal formation.

When Hayek wrote The Road To Serfdom, the serfdom that he envisaged was associated with what he saw as the two ‘socialisms’: Nazism and socialism (or communism). But there are fundamental flaws in his understanding of what constitutes serfdom. His knowledge of socialism was also limited to his own narrow ideological understanding of the word. In Hayek’s world, only the free market could protect liberty but, as we have seen in the last thirty years, people are less free because our politicians put the interests of corporations and banks first. The Hayekian praxis of Thatcher and Reagan and those who have followed them has put us all on a path to serfdom. The trouble is, those who support this form of economic libertarianism have little , if nothing, to lose. They won’t become  serfs. But the rest of us will end up as their slaves if we don’t put a stop to this nonsense.

Meanwhile in Israel, people have been on the streets to demand homes and jobs.

We need more of that here in Britain.

Guns or butter?

Here’s a song from a The Gang of Four.