Economics and the Powerful: How to fight back against neoliberalism

06 February 2013

By Enrico Tortolano

The left should make use of conferences and publications to educate themselves and organise in order to provide a real alternative to the neoliberal regime.

The recent gathering of the power elite at Davos served only to reaffirm what we already knew: That too much is never enough for the rich and powerful. Capable only of uttering unoriginal, orotund statements about how there really is no alternative to neoliberal austerity, their intellectual and moral bankruptcy was tellingly exposed. A new report by Oxfam shows that in 2012 the richest 100 billionaires added a colossal £150bn net income to their existing wealth. Between 1983 and 2002 sales at FTSE 100 businesses rose an average of 2.7% a year, slightly less than the growth of the economy. FTSE company directors, on the other hand, filled their boots with their pay soaring 27% a year above inflation, every year. This has meant the richest 1% now controls more than 40% of the world’s wealth, and their share is increasing.

New research by the Institute for Fiscal Studies (IFS), Piecing Together the Productivity Puzzles, shows that low real wages have been encouraged by more robust labour supply – or in other words, the creation of mass unemployment. Profits as a share of GDP in Europe and the US are at record highs and executive pay has gone beyond exorbitant. Concurrently, real wages for workers are falling or stagnating, justified by an economic elite in Davos as the natural consequence of “structural adjustment”. No structural adjustment for Tony Blair, royal families, oligarchs and other Davos grandees though.

David Harvey in his illuminating tract A Brief History of Neoliberalism reveals that wherever the neoliberal programme has been implemented, it has caused a massive shift of wealth not just to the top one percent, but to the top tenth of the top one per cent. In the United States, for example, the upper 0.1% has already regained the position it held in 1918. The conditions that neoliberalism demands in order to supposedly free human beings from the slavery of the state – minimal taxes, the dismantling of public services and welfare, deregulation, the breaking of unions – just happen to be the conditions required to make the elite even richer, while leaving everyone else to sink.

Trade unions and activists need an antidote and corrective to Davos strategy and propaganda that opines ‘there is no alternative’ to neoliberal capitalism. We urgently need a new manifesto for radical change. One that understands that neoliberalism is quintessentially a project to restore class dominance to the ultra-rich that saw their interests threatened by the ascent of working class organisations and social democratic / socialist government’s post-1945. Although neoliberalism has proved ineffective as an engine for economic growth, neoliberal policy has succeeded in rapidly shifting wealth from workers to capital and from poorer to richer countries. This process also motored the undermining of local / national and International institutions and narratives that promoted fairer distributive measures.

Few remain blind to the massive transfer of public wealth into a few private hands. There is a shared public understanding that neoliberalism has exacerbated existing inequalities, sent unemployment levels soaring, debt spiralling whilst poverty rapidly expands. However, other destructive aspects of this rapacious ideology, especially the insidious penetration of corporate culture and values into all forms of democratic life, are carefully hidden from the public gaze, but in fact drill deep into the institutions of civil, economic and political society.

Davos reminds us that it’s a global phenomenon. We are witnessing the systemic eradication of non-commercialised public spheres and institutions such as state schools, state health care, independent bookshops, workers’ owned newspapers, public libraries and swimming pools. All these social components are essential to meaningful participatory democracy as they bind individuals to community and wider society providing a robust mechanism for people participation in public policy and democratic activism.

Neoliberalism is the most dangerous ideology infecting our society and politics today. We must abandon the neoliberal economic and political logic of endlessly tweaking this failed system. Unfortunately, most mainstream politicians are trapped in the erroneous belief that sooner or later recovery will somehow occur and that the neoliberal capitalist system – underpinned by profit maximisation – will be restored in full. Because of the vast armoury of the neoliberal agenda and its creativity, the habits of thought that sometimes dominate trade union activity are easy meat for the monsters. Trade unionists spend their negotiating lives between a rock and a hard place and the crushing blows that are dealt in this place often make us forget that we should not be here in the first place. A really insidious habit of always accepting the least worst option develops. To get out of this current dilemma a new attitude must blossom, one of critically questioning all the options available and seeing beyond them all to a new and different future. A commonly heard expression of this mentality is the idea that we must vote Labour because they are not as bad as the Tories. We should be more confident. An alternative world really is possible. It simply doesn’t have to be like this. It’s time to reject the second best.

British unions have produced brilliant materials and evidence to prove this all wrong and give people confidence by dispelling the fear arising from the illusions that the economy was in tailspin and only more misery would get us out of it. It’s difficult for this to take hold of the minds of workers and lead to the kind of action that would, for example, save our pay, pensions and jobs. So it’s important to deliver materials that offer a concise and concentrated account of why the politics and economics of the Coalition’s programme, like those of the neoliberals everywhere, is so very wrong: No more than a form of theft and vandalism ideologically driven on behalf of the 1% who rule the roost through a complex network of essentially criminal activities.

Trade unions need to adopt a long-term strategy of resistance. Instead of jumping from issue to issue or rising up only to sink back down, we need to build real solidarity by raising the political consciousness of members. We need to be organising for a longer struggle, finding ways to create spaces for debate and change within a commitment to collective solutions. There seems to be a failure of imagination in the trade union movement, an inability to see how other activists – Occupy, UK Uncut etc – are developing not just new tactics but also new approaches to organising and campaigning. Adapting to an environment where constant change ensures that everything remains the same, they approach actions and demonstrations as components of a larger struggle requiring critical research, policy discussion, analysis and planning as well as the training and education of activists, organisers and importantly, leaders.

The General Federation of Trade Unions (GFTU) is one interesting example of the deepening of the political education approach by unions and this is reflected in their exciting new range of 2013 courses. The Centre For Labour and Social Studies (CLASS) publications and the PCS booklet series support this approach. GFTU General Secretary, Doug Nicholls rightly argues: “It’s about education: Education in its fullest sense involves liberating our minds, and developing new ways of seeing the world in order to change it. Trade union education has to help us understand techniques of negotiation, enhance our confidence and skill levels and engage us in knowledge. But this is simply not enough these days.”

Cameron’s Coalition and the Davos cabal send their children off at 6 years old to prep school, then to misnamed public schools, then off to elite universities. They study politics, philosophy, economics and, above all, how to wield power over us. They have think tanks in abundance, and always seem to give senior managers plenty of time off to learn how to try and outmanoeuvre us. They also have most employment law on their side, and of course the media. To empower our members and get increased activism we need to deliver courses and events that allow members to step out of the daily grind and consider the bigger issues. Or as Naomi Klein powerfully argues, ‘Information is shock resistance, arm yourself’.

Originally published in the Morning Star

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