Tuesday, April 14, 2009

Hobsbawm's alternatives

We ought to be able to show some generosity toward distinguished historian Dr Eric Hobsbawm, who has lived through so many decades of turbulent history and has consistantly supported the working class (even if they're now renamed "a minority of the poor"), as well as intermittantly supporting the bureaucratic elite who used to rule the Soviet Union.

Dr Hobsbawm argues in last week's Guardian that "the basic idea that dominated economics and politics in the last century” is that there are “two mutually exclusive opposites: capitalism or socialism.” and:

"We have lived through two practical attempts to realise these in their pure form: the centrally state-planned economies of the Soviet type and the totally unrestricted and uncontrolled free-market capitalist economy."

Is the current social, political and economic structure of Britain really the result of a "practical attempt to realise" a "totally unrestricted and uncontrolled free-market capitalist economy"? Dr Hobsbawn is referring, presumably, to government policy from Thatcher onwards. Clearly the policies undertaken in this period are consistant with each other but was the goal really the triumph of the free market? We ought to ask for whom these policies were carried out, irrespective of their democratic mandate. Britain's political structure is intertwined with its economic structure, in which power is fairly concentrated. The post Thatcher governments inherited a good deal of corporatist legislation apparently related to welfare state provision and a semi socialised economy through some kind of social contract. The "socialist" parts of the British economy have been relentlessly attacked, corporatist legislation restricting free trade has not, where it is in the interests of big capital.

The monopolistic structure of big capital and its relationship to the government apparatus largely explains the current crisis and why the governments response has been anything but "a practical attempt to realise" a "totally unrestricted and uncontrolled free-market capitalist economy".

Dr Hobsbawm asks "Have we really got away from the assumption" that "the growing chasm between the super-rich and the rest doesn't matter that much, so long as everybody else (except the minority of the poor) is getting a bit better off?" He doesn't think we have. If I was super-rich I don't think I'd think it mattered, even if I wouldn't demand "we" thought it too. The important point surely is how it came to be that "everybody else (except the minority of the poor)" got a bit better off and if this is likely to be a continuing trend. The principal driver of this ameliorative trend has been house price inflation. The prices have inflated because the market is not at all free and was not intended to be so. The continuance of house price inflation will eventually work to make "everybody else" worse off as housing stock becomes concentrated in fewer and fewer hands.

Dr Hobsbawm is right that what's needed is "a progressive policy". Better policies could be formulated than those which are on the table, and better policies could be formulated that most people would approve. We ought to ask whether there's any force in play capable of instigating such a progressive policy. There isn't. The likely trajectory of current policy follows from this abdication.

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