Corporate Mercenaries

Sunday, 14th November 2010

The LM Gang are back, this time advocating, in a new C4 documentary Britain's Trillion pound Horror Story,  the privatisation of healthcare and education and downsizing of the rest of the public sector to reduce taxes, the national debt and stimulate economic growth.

Back in 1998 a post-modern intellectual associated with the former Revolutionary Communist Party, which later became Living Marxism and then just the LM Group and more recently Spiked Online, produced a documentary for Britain's Channel 4, Against Nature, railing against misanthropic greens. They have taken some radical and provocatory stances aimed mainly at the thinking left, those of us who are not completely brainwashed by corporate conditioning and actually want to see a more caring, sharing and, dare I say, sustainable society. Since the fall of the former Soviet Union, they have argued that the socialist cause they once espoused is dead and instead they began a campaign against what they considered reactionary forces opposed to progress. To them progress was redefined as the globalisation of labour and consumer markets, rapid evolution of technology to enable constant material growth and the replacement of previous social structures such as families and close-knit communities with a shared cultural heritage with new structures based around life-style choices and special interests. The clique around Frank Füredi, a professor of sociology at the University of Kent and author of Reviews of Where Have All the Intellectuals Gone?, have morphed from extreme proponents of a worldwide Bolshevik revolution in the dying days of the modern era, to extreme advocates of postmodern neoliberal globalisation. Back in the 1970s and 80s, most on the left opposed immigration controls and welcomed multiculturalism because of a basic sense of humanitarian solidarity with the downtrodden, the perceived victims of imperialism and irrational ethnic prejudice. That was my gut instinct until the early years of the new millennium.

Yet as I try to explain in another post, modern globalisation owes its roots in 18th and 19th century European colonisation and the expansion of the United States as a world power. The left also championed women's rights, another very noble cause, which has arguably been perverted to disempower families, as wel as gay rights, which while removing stigma against natural feelings of erotic attraction towards the members of the same gender, served similar purposes in weakening traditional family units and empowering big business and the state. Thus for many years the disciples of Frank Furedi could pose on the left. When other sections of the left opposed nuclear power and later genetically modified food, the descendants of the British RCP, championed these technologies as a means of feeding the poor.

As noted elsewhere, former RCPers have become very media-savvy, but we'd be very naive if we thought they had somehow successfully inflitrated corporate media organisations in order to promote a revolution that would see the overthrow of the today's ruling elites. Rather they serve as fifth-columnists embedded in media and organisations appealing to the wishful-thinking left on behalf of a corporate elite who owe no allegiance to the ordinary people of any country.

Smart propagandists like to build on concerns about a very real problem and then differentiate themselves from other more mainstream opinion leaders to appeal to a disgruntled section of the gullible electorate. If we sum the government debt accumulated thus far and the total commitments for debt repayments, planned public expenditure, the UK public debt is forecast to reach a staggering 4.8 trillion pounds, which as the documentary pointed out could not be repaid if every house in the country were sold at current market rates. This is obviously unsustainable, indeed so obvious that even advocates of unlimited growth admit it. The documentary rightly sheds light on the huge bureaucracy within the UK's public services. Of 9 million public sector workers, only 2 million are engaged in frontline jobs as teachers, doctors, nurses, firefighters, police officers etc... Instead most sit in offices administering and monitoring others. Many dependent services become self-serving as they only exist to service the administration of the public sector. For instance, an equal opportunities commission does not provide the underprivileged with new opportunities, but merely liaises with other employers and service providers to ensure their client groups are well represented. However, as they're in the communication business, they inevitably require IT, multimedia, printing, catering and transport services and their infrastructure relies on hardware technicians, builders, plumbers, joiners, mechanics and electricians. However, this huge waste of resources is not confined to te public sector. We not only have a huge rise in the third sector of NGOs, charities and not-for-profit foundations promoting this or that agenda, but large corporations, even those with an industrial base, have morphed into miniature states. For all the talk of lean manufacturing and streamlined organisation, most large private sector companies are chock-a-block with non-productive penpushers and people-managers. hile the public sector is undoubtedly inefficient, it is at least in theory accountable to taxpayers. The documentary completely missed the point, why would the government and its corporate masters subsidise non-productive people management on such a large scale? The previous NewLabour government, which ran up the largest deficit in the UK's history, can hardly be accused of not acquiescing to the needs of large transnational corporations. More important before the government began its huge spending splurge following its 2001 re-election, banks had begun lending irresponsibly to millions without stable employment or even on benefits. The UK doesn't just have a public debt, but also a huge private debt to the tune of £1.4 trillion. Most owners of typical 3 or 4 bedroom houses do not really own their homes outright, their bank or building society does. They are in most cases 6 months to a year away from eviction should they fail to honour monthly mortgage repayments. Worst still as property prices skyrocketed in the South East of England, hundreds of thousands took out interest-only mortgages, i.e. for an initial period, usually 1 to 2 years, they pay only interest on their mortgage, but after this period of grace, their monthly repayments go through the roof. Many believed in a era of unprecedented finnacial growth that 2 years later they woud double or triple their earnings and once they were on the property ladder living the middle class dream, life would be sweet. In the end the government had to bail out the bankers, so a good deal of the huge £4.8 trillion debt is actually inherited from the private sector. I would suggest that both the state and corporate sectors wanted to stimulate consumer growth. Miraculously, as NewLabour launched Private Finance Initiatives and continued to transfer public services to private contractors, quangos continued to grow.

Expropriation

Most transfers of ownership from private to public and the from public back to private hands disempower locals and empower transnational corporations. In its early stages in a favourable resource-rich environment , a market economy can theoretically reward hard work and let entrepreneurs build communities around the provision of useful products and services. This certainly appeared to be the case in 19th century North America and even in prosperous enclaves of Western Europe. However, such a system relied on a working class willing to let their bosses profit from their labour in exchange for job security. As small companies grew larger to take advantage of economies of scale and drive industrial development, the proletariat became a distinct class whose interests clashed with those of their bosses. Before the emergence of capitalism, most workers were mere peasants tilling a small plot of land and handing a large proportion of their produce to their landlord as rent. Much of the British economy came under government ownership in the aftermath of the Second World War as much of the country's industrial infrastructure such the still important railways, coal mining, steelworks, health system could not operate effectively at a profit. The State left the profitable sections of the economy to the private sector. Indeed much had controlled by huge state interventions, not least through massive armaments contracts. Nonetheless after the austere 1940s, the 50s and 60s saw the longest period of economic and social betterment, as measured by rapidly decreasing infant mortality, the reduced incidence of poverty-related diseases (such as rickets) and full employment. Although the tertiary sector continued to grow, Britain still had a manufacturing base. Most cars, lorries and trains were still made in the UK as was most industrial machinery, coal and steel. While more and more women chose to pursue careers, most mothers of young children were happy to work as housewives. In many ways the 50s and 60s were the hey day of the modern nuclear family with its typical 2.3 children. Social services still played a relatively marginal role and Health and Safety inspectors were few and far between, hence despite apparent technological limitations before the advent of microprocessor-enabled information technology, public sector bureaucracy was a lot smaller.
Proponents of nationalisation or privatisation often use the democracy argument. Thus nationalisation makes an organisation democratically accountable, while privatisation frees an enterprise of the constraints and inefficiencies of state control and places it in the hands of private shareholders. In reality nationalisation merely transfers ownership to the state, which in turn serves the interests of its corporate backers and usually rewards former owners handsomely, while privatisation leads to a temporary injection of capital into the public coffers, but has always transferred ownership to monopolistic capitalists, thus failing to provide any real competition. We could even argue that nationalising loss-making industries did an enormous favour to venture capitalists as they could invest their compensation oversees, allowing other entrepreneurs to acquire the more profitable remnants when the government privatises again.
The post-war boom would simply not have happened without an advanced welfare state, a healthy and largely contented work force and the survival of strategic energy, transportation and manufacturing industries. Hence even capitalists, claiming to favour a free market, supported nationalisation in the mid 20th century. The Thatcherite revolution practically outsourced most major manufacturing and refocussed on non-productive media and banking, a trend that continued unabated under New Labour. The only segments of Britain's industrial base that remained almost unscathed were the multi-billion pound government-subsidised armaments industry (so-called defence), the pharmaceutical and biotech industries with some niche luxury and entertainment gadget producers. Manufacturing saw a brief comeback in the late 1980s and early 1990s with an influx of American, Japanese and German inward investors. However, by the early twenty-noughties factories resumed closing, replaced only by supermarkets, call centres, entertainment complexes. In 2006 Tessa Jowell promoted regional casinos as a means of job creation and urban renewal in Britain's depressed former industrial heartlands.
In 1997 I suggested to an acquaintance who worked as an advisor for the Labour Party that he'd better save up for his daughter's university education. "Nonsense", he said, "New Labour would always ensure higher education remain accessible to all". A few months later, New Labour announced the introduction of tuition fees, initially just £1000 a year, soon rising to £3000 and now, under the Con-Dem government to £9000. As a result millions of young workers will either have to accept low-paid jobs to escape repaying their loans, thus defeating the purpose of higher education, or forever be in debt. However, the true cost of higher education actually exceeds £9000 a year, but that misses the point, the whole sector is slowly but surely being primed for privatisation, relying on wealthy foreign students and failing to train the country's future generation of engineers, doctors and scientific researchers, while the relative academic value of degrees has been significantly debased. In the 1970s only 15% of school leavers went to uni, by 2010 that number is nearly 50%. Despite the Blairite mantra of education, education, education!!, class sizes have grown and student behaviour worsened leading hundreds of thousands of middle class parents, including Labour cabinet ministers, to send their offspring to private schools. When they consider the costs of a UK university degree, they might as well use their academic loan to send their offspring abroad. I suspect Indian universities will soon start offering cut-price degrees to the same disgruntled moneyed middle classes who travelled to Eastern Europe for cosmetic surgery.
The previous government pumped billions into the national health service, insisting all new hospitals be built via PFI (Private Finance Initiatives). Despite the rhetoric the NHS bureaucracy has mushroomed with billions squandered on management consultants (not doctors) and centralised IT projects, as detailed brilliantly by David Craig in his 2008 book Squandered. More disturbingly, vast sums of public money have been spent not on essential frontline healthcare, but on promoting awareness of new mental illnesses and lifestyle-related ailments ( diabetes, obesity, angina, high blood pressure etc..) hugely boosting demand for pharmaceutical products. Amazingly, the new Con-Dem government, depsite a massive debt, has committed itself to maintaining the previous administration's spending plans. In real terms public health spending has doubled since 1997, yet the nation's health patently hasn't as any gains in prosperity have been offset by culture of hedonism and a growing rich-poor gap. Any recent gains in life expectancy have more to do with improvements that occurred 30-40 years ago (i.e. your life expectancy is largely determined by your health in your 30s and 40s) than multi-million pound anti-smoking campaigns. The US probably has the world's most wasteful healthcare system with 16% of GDP devoted to public and private healthcare. This compares with 10 to 11% in France, Canada and Germany and 8.9% in Italy, 8.7% in Australia, 8.4% in the UK and just 8.1% in Japan, while life expectancy is highest in Japan, France, Italy, Spain, Greece and Iceland, probably more down to diet and lifestyle than provision of drugs. The US Model is to boost public demand for healthcare services persuading more people that they need long-term medication and cosmetic surgery (not included in the above figures), creating a huge comsumer market. In my humble analysis the UK health system is being primed for privatisation in all but name. It has become such a monster as to be completely unsustainable and the corporate elite will rely on a knee-jerk reaction to reports of waste and inefficiencies to soften public opposition to the removal of universal provision of healtcare free at the point of delivery. Nadeem Waylayat of Market Oracle has detailed the almost inevitability of the failure of the NHS project ( see http://www.marketoracle.co.uk/Article23744.html ), however, he seems to welcome its downfall. I hasten to add, when the NHS collapses, millions will suffer the consequences.
Martin Durkin's documentary is just the latest salvo in a war against common sense, i.e. a rational world in which education and healthcare serve the needs of taxpayers rather than those of multinational corporations and are not allowed to become unsustainable. Apparently he has the government on his side as they have now allowed the cloning of animals for human consumption and given the green light to transgenic farming and quiely announced the privatisation of the Royal Mail.
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