Monday, 19 December 2016

In defence of populism


Populism poses such  a threat  that David Cameron  has had to go to the US to tell them, for a fee, how it ruined his plans for a better Britain. It may once  have been the precursor of reform In the US. Now its global and a threat to the political elite which imposed the policies which exacerbated the populist drive spreading round the world. We need to understand it yet the commentariat  see it as a turd on the table of Downton Abbey. In the US its portrayed as a Trumpian disaster slightly less dangerous than nuclear war. In Europe it endangers the blessings of the Euro and ever closer union and produces  opportunities for a new Hitler.Even several.

I can agree that populism has its dangers. It's  tide can carry the man on the white horse or the one with yellow hair, to triumph over safer and sounder hands .In power  populist prophets  either become dangerous or betray their supporters to turn like Orwell's pig, Napoleon who turned into a nasty human.  Insofar as its the bar room braggadocio of easy answers and loud talk, populism is impossible to implement. Watch how Trump, having won by denouncing Goldman Sachs and Wall St stuffs his government Goldman staff and Wall St Republicans

All that provides fun for academics and the commentariat who are always right after every event Yet for the practical politician, and particularly for the Labour Party, populism poses more  immediate problems. It won't go away and we either understand that and adjust to it, or fail the protesting people.

Look at how it emerged. Post war politics were a game of two halves .In the first, the Never had it so good years , full employment, a welfare state and steady growth raising  the living standards and household incomes of the people shaped an affluent era in which the only symptoms of populism were  protests at immigration from Smethwick's electors and Powell's dockers. Both condemned but both allayed by restrictions on Commonwealth immigration.

For those at the bottom of the heap the second half of the game were the never had it so bad years of globalisation, neoliberalism, austerity and EU membership all of which ended full employment, curtailed welfare, replaced job security with the gig economy and damped the year by year improvement in household incomes and living standards. No wonder a new populism emerged among those left behind .No wonder either that the liberal elite, who'd benefitted from the changes found so little response to their  sermons about the benefits of globalisation and immigration and their assurances that the pain would be worth the gain with  a long term good which somehow never seemed to come.

 Labour, the cause of a good deal of the misery and the source of many of the sermons must  recognise that the populist surge comes from what should be Labour's  people: those at the bottom of the heap, those not educated enough to access the joys of a middle class life style, those left behind by economic and social change and those suffering from the rigours and  pain of austerity, globalisation cuts and the end of full employment. They don't think  that the blessings for the well off will trickle down to them  They need help now and no one else will provide it if Labour doesn't

This not only changes  the name of the game but the game itself relegating Labour's people to the uphill side of a loosing team. This happened for three reasons  Margaret Thatcher's neoliberal follies, combined with membership of a European union geared to serving the purposes of more powerful competitors, have  undermined  our industrial base and a manual working class which was shrinking anyway Government reduced the protective power of the people's defenders, the trade unions, the council estates, the mutuals and  local government in order to serve wealth, big business,  finance and London. Labour ceased to serve those at the bottom of the heap to win the support of those further up. No wonder politicians began to chant "We're all middle class now" But we weren't.

How do we respond to this new world which Labour helped to create?  Blair,  Mandelson and the third way brigade proposed to take Labour's traditional vote for granted, win respectability by accepting the Thatcherite programme and reach out to the growing middle class and the south .As a result in power we delivered too  little to our people, more to finance. We declined to restore union rights and kept them  on a tight leash to pursue more esoteric causes. Instead of class and equality we preferred feminism, ethnic justice, foreign aid, rights, environmentalism , consumerism and Euro enthusiasm  with a welcome to immigration thrown in

Labour has always been a coalition of proletarian populism, some of which is inevitably ugly, and middle class aspiration but in recent decades the latter has triumphed over the former. That  makes it difficult for the party to change tracks.In Parliament and party, horny handed sons of toil and  trade unions have made way for more women, ethnic groups, middle class kids on the make and apparatchicks and chaps who'd done an apprenticeship in Blairworld. All are  more presentable, house trained, younger and nicer but  middle class in  life style  and  less in touch with the world  of the underdog. Women took over the mining seats The party placed trusties in plum seats and a debilitated outside party accepted the imposition.  Youth and gloss  were more important than proletarian identity. The result was a party less in touch with its basic support and their world ,which was  taken by  surprise when Scotland rebelled, UKIP stole Labour votes,  and the people rejected an EU Labour had come to see as part of God's plan.

Describing populism is much easier than dealing with it. Denouncing it as wrong will only exacerbate the alienation and the feelings of impotence which built it in the first place.It  arises  because both parties have failed to deliver the growth, the full employment and the steady improvement in incomes and .living standards those at the bottom of the heap expect and had had in previous decades. Instead they've got sacrifices which fall primarily on them.

 Yet dealing  with the dissatisfactions of the people left behind  is not only expensive but involves a major change in national priorities .It requires us to compensate the people who've lost out to globalisation. It means making its beneficiaries pay a fairer share . We need to boost  the parts of the country which have suffered rather than concentrate all blessings on London and the South east  Either we rebalance the economy and run it in a way that satisfies the mass of our people rather than serving the interests of the monied elite, or  we face the alienation and dissatisfaction  which we'll then have to excoriate  as nasty populism.

Why not learn from history? The never had it so good years of post war growth shifted the social balances  from wealth to people.  Economic policy was managed to compensate them  for the sacrifices of war and the suffering of depression. When neoliberalism shifted the balances back to wealth, a culture of richesse  insultante  developed  and the life of the people became harder as they lost the power  to help themselves or even live a comfortable life .Instead of being protected, compensated and helped through the impact of globalisation its victims were punished by austerity while the benefits went to the grabbers and the greedy. When  ordinary people are sacrificed to the needs of wealth, banks and  financial institutions and condemned to watch as high salaries and big bonuses are showered on those at the top of the heap, its a little unrealistic to expect gratitude.

The people have been delivered, hands tied, into an age of big corporations, mighty multinationals, big, brutal government and greedy self enrichment .The market prevails  over the state which once protected them. The party which once advanced their cause has other things to do, more fashionable fads to follow. So why is it  surprising that the unloved feel they're ignored and that no one listens to, or speaks for them ?Why should we be amazed when they  seize the only chance they've had to hit out ? Is it Labour's business to tell them they're wrong

Lets reform our companies too

It's disappointing to find that Theresa May is  backtracking, in the face of the clamour of pain from business, from her promise to put workers on the boards of British companies. It's even worse that she's indicating that the limitation of top salaries and executive enrichment she wants to see won't now  happen.Two big mistakes  Now that we've made Britain a good place to do business it shouldn't be a good place for business to do the people. We need strong British companies to do it.

Having urged a requirement to put workers on boards to the last two  enquiries into corporate government I can  understand the difficulties of making business see that its best interests lie in developing a team relationship with its employees rather than imposing low wages and casual conditions. The Cadbury enquiry, commissioned by the Financial Reporting council in 1992 after a series of scandals, did at least listen. Sir Adrian Cadbury met us and agreed to  some of the reforms we urged in respect of stronger audit committees. The second enquiry was far more reactionary. It laughed at our proposals and flatly refused to share any power with the workers or to envisage any further reform of a system of corporate government which they viewed as the best possible in the best of possible economies

 Their claim that companies are answerable to their shareholders, not to government or their workers is a hypocritical myth.The average time for which shares are held has fallen from years to less than six months. Turnover at that speed means that few shareholders come to eat the cucumber sandwiches at AGMs, that it's rare for them to object to top salaries and even rarer to get them reduced The Directors always come armed with sufficient votes to carry whatever they want The funds who hold most of the shares are more interested in trading them to raise their own fund indexes  than to exercise any supervision.Everything is short term. The prevailing concern is not about company growth but shareholder value which determines the rewards of those at the top.

Because of this myth British companies have managed to escape giving workers a say in the running of their companies in the way the Germans do with two tier boards such as the one running Volkswaggon,or the worker representation on the boards of most other companies in Germany and in the other EU countries.  The benefits are obvious and were well argued by Labour's Bullock report in the seventies. Workers  involved in the running of their company are treated as a team not an exploitable, disposable resource. They have a strong interest in its strength ,success and survival unlike even the directors and CEOs  of British companies who are all too ready to sell up, gab huge sums for themselves and get out leaving their company to be run down or dismantled.

Worker directors would also advance Mrs May's other aim of reining in fat cats ."Star" CEOs and directors effectively decide  their own remuneration and they're usually very generous to their own talents. Shareholders have little say, witness the puny protests at Martin Sorrell's enormous rewards Eighty British CEOs take home over a million pounds a year and legions are showered with bonuses and share options. Are they worth it when British companies are fairly consistantly beaten by Germans?

Instead of maintaining their rewards in a decent ratio to those of their workers British directors are too inclined to milk their companies and vote themselves massive rewards while  treating workers as a cost to be cut down on by low wages, casual employment terms and intense exploitation of the Sports Direct kind.No wonder our productivity is so much ,lower than Germany where workers are treated as part of a company team and Mitbestimmung,or co-determination, produces ensures that waged claims are less excessive. No wonder too that far too many British companies have been closed down (look at the wool industry) or sold out to foreigners giving Britain the highest proportion of foreign ownership and killing off our few national champions like GEC and ICI.

If we are to compete successfully and build up strong companies as national champions we must stop treating them as commodities to be sold swapped dismantled or closed down just to enrich the few at the top. We can avoid this by treating workers as a team and giving them a say. Britain should learn from Europe rather than imitate the US. My advice to Theresa' May is to press ahead with reform Don't be deterred by the fear,shock and terror they'll generate in our greedy CEOs and our irresponsible board rooms.

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Think Big Is Think Bad

Tax and social security are quick to  investigate beneficiaries claiming benefits while buying Lambourghinis.Yet when the nation wastes money on expensive projects it's viewed as a symptom of national virility and something to be proud of. Prestige projects are welcomed enthusiastically by ministers, politicians , the media and the vested interests who'll build or benefit.All think big and even now with Britain's finances in a mess, stringency the rule and local government crippled by cuts,Theresa May has  endorsed two huge white elephants in Hinkley Point and HS2 .

Big projects always turn out to be bigger disasters diverting enormous resources from better purposes and  always overruning. They never fulfill the big expectations held out for them and waste the resources of a nation  strapped for cash  forced to cut everything to meet a horrendous deficit and imposing a bedroom tax to force poor tenants to  pay more for living space.

The  health service is falling apart and needs twenty billion more by 2020. Instead it has to cut by a billion.Local government has to cut spending by a quarter by closing childrens' centres,libraries, youth facilities,social services support for old people and rubbish collections and even selling off town halls. Yet we can afford to squander billions on computer systems that not only don't deliver but end up costing two or three times the original estimates.?

Look at transport.Commuter lines into London, Manchester Birmingham and Leeds are now cattle transport.The companies can't make the the trains run on time,Southern is slashing services , Network Rail has had to be expensively renationalised and road congestion is up 40% in four years.Yet the Department is is Gung Ho for a High Speed Train which will take twenty minutes off the journey to Birmingham and  an hour off that to Leeds (which it won't reach until 2033).The cost has risen from an initial  thirty billions to eighty billions and almost certainly more in the future. To to save money services to Heathrow and Meadowhall have been cut and they can't afford to run the line into Euston .It will, decimate villages, towns and the countryside,all  to give a lower return than investing in  breaking  bottlenecks now . 

We need  the army navy and airforce to protect us and to intervene where our interests or humanity are threatened..Yet conventional forces have been cut back to the lowest level in two hundred years because so much is being spent on Trident Missile systems we'll never use (and can't without American permission) at a life time cost of 205 billion pounds .We're  acquiring two huge aircraft carriers we can't land planes on  and which will need several of pour shrinking numbers of destroys to protect them. We've got  high technology planes to fight a Cold War that's over but can't afford safe vehicles to protect our  troops from being blown up by primitive improvised explosive devices in Afghanistan and Iraq, two countries where British troops have  taken on battles they couldn't win  in Basra and Helmund where they had to be rescued by the Americans. 

 This coming winter pensioners will die of hypothermia or sit huddled for warmth because they can't afford to put the heat on .Yet government intends to throw billions away on Hinkley Point by getting the French to build a nuclear reactor with Chinese moneywhich hasn't yet worked anywhere then make the consumer pay for it by huge electricity charges. The original cost of this white elephant was twelve billion but it has already gone up to twenty before it's even started on a project which will overrun, and which,once started must be finished at whatever cost escalation the French want.If we have to have nuclear for base load  two or three modern American or Chinese designs could do the job better and far more cheaply.

The list goes on.In several years on the Public Accounts Committee I saw too much government waste on computer programmes, like the NHS computer estimated to cost two billions  which had risen to 12 before it was stopped,on defence contracts and on coming to soft deals on tax with big multi nationals Yet the biggest failure was always governments' love of  taking on prestige programmes it can't afford which will only materialise years ahead

 London needs more passages over or under  the Thames for the growing traffic pressure but the only  proposal is to build a 185 million garden bridge for people to walk over smelling the roses,though it may also become a "hedgehog superhighway".Even if it's cancelled as it should be it will still cost the tax payer fifty millions.The M62 across the Pennines is choking up but government  proposes a twenty five billion nineteen mile tunnel under the Peninnes for HS3 and has no plans to double roads or rail tracks now to remove the bottlenecks. The trans-Pennine rail  needs electrifying but instead the department is too re-build an Oxford to Cambridge line closed for lack of use. There is a huge need for public housing for rent for those who can't afford to buy. Government won't borrow to build it ,and won't let local authorities  issue bonds to build council houses even though they produce an asset with a return.Instead we get luxury flats for foreign millionaires and "affordable"houses which aren't

It's more than time to give up the pretence of being a great power and a rich country and recognise that we can't afford  big bills for big projects.We can't even pay our way in the world .We import more than we can export and have to sell off  companies,property and farms to pay for it .A country in that situation whose budget is in deficit and where every provision is cut  must avoid grandiose follies and put the money into financing the NHS properly,building public rented housing  and  rebuilding an infrastructure and a transport system which are disintegrating for lack of investment. It's more than time to cut our coat to suit our shrinking cloth.Forget think big .Just think   

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