Compass New Year Annual Lecture 2011

Prof. David Marquand has written about the ‘unprincipled society’. He believes that successful societies must be underpinned by a moral case, and Neal Lawson, Chairman of Progress, argued that this was necessary for the progressive left.

Outside of the scope of the discussion is an analysis of political parties. Marquand argues that there should be a political, economic and moral cross-disciplinary discussion of ‘the truth’ for the future. Marquand argues that the conversation needs to start with the economic crisis of 2008, which was expected to trigger a departure of neo-liberalism orthodox using a precedent of 1930s and 1940s. No substantial economic leader appears to have echoed Roosevelt’s call ‘to drive the money changers’ from the temple. There is a sense of driving back to ‘business as usual’. Keynesians want to get back through stimuli, neoliberals strive for balanced budgets; the two groups disagree on the route, but not the destination, according to Marquand’s thesis. The crisis demonstrated, according to Marquant, that unrestrained capitalism does not necessarily work; private greed, e.g. created in hedge funds, are wealth destroyers, not wealth creators; wealth has not trickled-down; the self-regulated markets have demonstrated to be a phantom, which has produced outrageous inequalities causing a ‘turbo-capitalism’ not driven by rational economic actors but ‘electronic gamblers’.

No particular school of thought can therefore explain the economic crisis. Marquand believes that Marx has more to say than Keynes or Hayek, and wishes to look at three consequences of thus for public life.

‘The public realm’ as opposed to the buying-selling market. One of the great achievements of the late nineteenth century was to create the career civil-service driven by merit, Lloyd-George’s National Insurance Act, Bevin’s National Health Service. There is a flaw, in the sense that the guardians about the public realm forgot about the inherent voracity of rampant capitalism. They failed to see that the market domain is inherently expansionist, and is likely to invade or annex the public domain.  Marquand argues that the Thatcher government and Nu Labour accelerated this through privatization and marketization – a long-drawn process of ideological colonization, akin to the Stalinisation of civil society. Wherever possible, public institutions were forced into a market mould. The corporate private sector provided the sole model, which encouraged a slide back to fiscal corruption (as demonstrated through ‘the expenses scandal’).

The Conservative-Liberal Democrat Coalition appears to have extended this. For example, the debaters focused on the impact of Lord Browne’s review of higher education on individual students of different backgrounds, but missed the impact of higher education on the public realm. For Browne and his colleagues, higher education in the arts and social sciences is a ‘private good’ or ‘commodity’, giving graduates a higher standard of living, which should be traded in the market-place. Subsidies should be freed up, like electricity and gas, so the market is truly free, thus allowing free choice between economically-rational students ‘drive up standards’. Marquand argues instead that the University should be where young people think critically, in helping people ‘to grow’, like public libraries, belonging to ‘the public realm’. Universities therefore become supermarkets satisfying individual wants. Browne’s review is part of a syndrome which goes back to the 1980s – Lansley’s reforms to the NHS are similar , conceptually.

The totemic word is ‘choice’. ‘People want choice’ according to Andrew Lansley (and also Alan Milburn’, as we live now in a consumer age.

The distribution of resources and life chances. The Labour Party is specifically egalitarian, but there was not much change in the income distribution in the post-war era. ‘The G coefficient’ measures income inequality; the higher the coefficient, the more unequal the society. In 1962, the coefficient was 0.26; in 1980, it was 0.25 in 1980; under Thatcher and New Labour, it rose. By 2007, it was higher than all EU states apart from a few; the UK was 8^th, in terms of the numbers living in poverty. The UK is more unequal now than when New Labour came to power, and the UK is an ‘outlier’ in Europe, both in terms of poverty and income distribution, than any other country in heartland Continental Europe. Marquard believes that turbo-capitalism was the only way forward for economic growth.

Democracy It is often assumed that capitalism and democracy are natural bed-follows, explaining why the West approached the ex-Communist Worlds, for example.  However, this is not true of China or Chile, for example. The basic promise of democracy is equal citizenship, in other words nobody has the right to rule over others without their basic consent. There is a built-in tendency for the inequalities in capitalism to spill over into the inequalities in democracy. For example, Frederick Hayek and Lord Salisbury have argued that democracy undermines capitalism because of the pressures for ‘resource distribution’, producing a dilemma for capitalist countries: “how can we reconcile the outer appearance of democracy with untamed democracy?” In the UK, the answer is what Stefan Colini from Cambridge has described as ‘market populism’.

Marquard argues that the total picture is bleak for a number of reasons. Marquand can detect “growth points” of a better society. Turbocapitalism has been legitimized by a passionately-held moral vision; unhindered pursuit of self-interest in free, competitive markets is not only economically efficient, but morally right. Collectivist interference might turn them into ‘moral cripples’ as described by Thatcher, in awe of choice and freedom of the individual. Not all choices are morally equal; freedom to ignore the moral good is not acceptable. We cannot go back to the highly structured, oppressive society, a debased culture which pervades the twentieth century. There are resources in social movements on which we can build, e.g. the burgeoning environmental movement, the National public libraries campaign. The notion itself is still alive. Edmund Burke, ‘the father of Conservatives’ considered society as a partnership between the living, the dead the unborn, an ethic which challenges turbo-capitalism. John Stuart Mill sees the freedom to develop and grow in civil associations contributing to the ‘worth’ of society. Ethical socialists see fraternity in the lived experiences of the Labour movement, different from the regime of the New Labour regime. Civil engagement, mutual learning and public reasoning constitute the way forward. In a book called ‘Not for profit’, democracy is not just head counting, but must be informed by daring decision and rich human relationships.