Bigger state no answer to 'Big Society'

David Cameron’s crusade for the “Big Society” should compel its opponents to question and reconsider the role of the state in our corporate-owned, profit-driven society. Unfortunately, it has done nothing of the kind.

Though difficult to pin down, the BS project could be understood as Cameron’s libertarian response to a top-down, bureaucratic state that vast swathes of the population despise and want nothing to do with.

Perhaps Tory prime minister Cameron understands that should this attitude to the state continue unchallenged, there’ll come a time when it loses remaining legitimacy. And that point, anything could happen, as events in Egypt have shown.

So the Coalition’s plan is to shed the state’s responsibility for things like forests and involve the unelected, unaccountable “third sector” of charities and the like to bid for services currently provided by local councils. Other community projects will be able to access funds from a BS bank and the rest of us simply have to volunteer.

Labour and trade union leaders like Brendan Barber have simplistic responses which reveal much about their fondness for the capitalist state and litle else. Labour crudely says the BS is a “cover for the cuts”, which is a bit rich for a party implementing the government’s draconian policies at local level without any resistance.

Just for the record, the previous New Labour government contracted out huge chunks of formerly state-provided services at vast cost to the taxpayer. Private Finance Initiative (PFI) schemes became a licence to print money for companies building hospitals and schools while Londoners are weighed down by the cost of rescuing a failed Tube modernisation contract.

Now it turns out that 25 for-profit Independent Sector Treatment Centres created by New Labour to do non-essential operations on behalf of the NHS have been overpaid by up to £250 million in the five years to 2010. This is because they were paid a fixed sum, even though the centres carried out fewer operations than the contract specified.

So the Coalition is deepening a trend set by Blair and Brown, which makes the claims that Cameron wants a “smaller state” more than slightly ludicrous. Barber, general secretary of the Trades Union Congress, who bizarrely says the BS will create a failed state like Somalia, favours the Scandinavian approach, consisting of a massive (and oppressive) state apparatus and a welfare system paid for by taxing ordinary workers at around 50% of their incomes. (If he cared to check he would find Scandinavia is moving towards market states).

But we should we allow ourselves to be placed in a position of defending the role of the existing state (Scandinavian or otherwise) in opposition to the BS project? The present state reinforces the capitalist status quo, with its gross inequality and exploitation. It sanctifies profit by legally obliging corporations to put shareholder interests first. The “welfare state” in turn legitimises the notion of the deserving poor, forever dependent on the charity of the state.

Other parts of the state apparatus supply judicial and police powers to control the population lest they resent what passes for democracy, fitting up activists where necessary as they did over the Nottinghamshire power station action. So who’s for a bigger version of this wretched state? Only Ed Miliband and Barber because access to the state gives them privilege and limited power without ever having to challenge how things are.

We are obliged to develop concrete ideas for an altogether different system of ruling, one that does not sit above society while operating on behalf of the powerful and the rich. What is wanted as an alternative to the BS and Labour’s love of the state is a thoroughly democratic system based on a network of People’s Assemblies as a transition to real self-rule. At the heart of such a democratic system would be co-ownership and control of all society’s resources, including land, banks and corporations. Then we could truly say that society was much, much bigger than it is today.

Paul Feldman
Communications editor

All out for the Climate Camp!

Climate Camp 2009 will “swoop” on a site near the hated City of London, on August 26 and the camp’s website sets out 10 good reasons for choosing this location.

One reason is that there are more branches and subsidiaries of international banks in London than in any other city in the world. “The Royal Bank of Scotland, Britain’s high street bank most closely associated with financing fossil fuel projects, has received billions of pounds of public money and is now more than 70% owned by the UK government.

“Yet despite this research shows that, since October 2008, RBS has financed loans to companies involved in the oil, coal and gas industry worth almost £10 billion. And yet renewable energy projects, like the Isle of Wight wind turbine blade factory, are being abandoned,” says Climate Camp 2009.

Top of the list for being in the City, however, is the fact that “London is currently the natural habitat of the transnational corporation, one of today’s most powerful causes of social and ecological injustice. Unaccountable, undemocratic and causing catastrophic climate change, these creatures need to driven into extinction.”

How to achieve this excellent goal will be the focus of the workshop that A World to Win is hosting on Saturday, August 29

The title of our workshop is “Composting Capitalism”, and we will argue that it is the capitalist state that stands between us and a sustainable future for humanity and other species and eco-systems.

The transnational corporations do not maintain their rule over us directly. For that they rely on the state - parliament, local government, education, the police, the army and of course, the monarchy. This network of control maintains the rights of private property and the right of the transnationals to exploit the planet for the extraction of profit.

Whether we like it or not, we can’t ignore the state, jump over it, or opt out of it. And experience shows that it is impossible to reform it, either. We must not rely on these structures to act to halt climate change.

We cannot start to tackle the devastation wrought by the capitalist drive for profit until we liberate the resources, talents and technologies created by humanity as a whole from their power and control.

We need to overcome what Marx called the “metabolic rift” that capitalism has imposed between humans and nature. Only in this way can we defend our own society, other species and eco-systems.

Therefore, creating a new democratic, transitional state is the key to liberating nature from corporate pillaging. We need to start now by organising local, regional and national Conventions that bring together people whose lives and livelihoods are being destroyed by the capitalist crisis.

As more and more people reject parliamentary politics and parties and start looking for new democratic solutions, we have a window of opportunity. We should not hesitate to establish our own parallel structures as test beds for democracy.

Direct actions along these lines would amount to a sustained challenge for power.

We look forward to seeing you at Climate Camp, and hearing your views!

Penny Cole
Environment editor

Occupations confront the state as crisis deepens

Hopes of a recovery in the health of the banking sector and the real economy look more like pipe dreams in the wake of worse than expected figures from Lloyds and Northern Rock. Both sets of losses reveal the impact of the deepening recession.

Financial institutions worldwide are now suffering the second wave of destruction of value since the crisis erupted in 2007. The first wave was triggered by the end of the credit-induced boom as consumers reached the limits of their ability to pay the interest on their mortgage debt. The most exposed to the pyramid of fantasy finance built upon sub-prime loans were the first to be hit and the result was the closure of the credit markets.

The vast sums poured into the financial sector by central banks and governments last year in an attempt at a globally co-ordinated programme to restart lending came to nothing. Rather than disappearing into a black hole as some said, the money has found its way into the gambling houses of the world’s soaring stock markets and is once again driving commodity prices up. These are the figures that are used to bolster belief in a recovery.

Lloyds’ losses of £4 billion are worse then the most pessimistic of expectations, partly as a result of its exposure to the sharp and continuing deterioration in the commercial property market. New Labour’s fabled asset protection insurance scheme designed to help banks by nationalising their losses and passing the cost to taxpayers has also come to nothing, as neither RBS nor Lloyds have fulfilled their promises to sign up.

As businesses fail, jobs are lost and unemployment soars no-one should be surprised that Northern Rock is suffering a greater exposure to mortgage payment default than the rest of the industry.

As the crisis deepens, corporate employers and the capitalist state that stands behind them must attempt to rescue their economic system and pursue a return to profitability by intensifying the elimination of excess capacity in the real economy. They will stop at nothing to achieve this aim.

Yesterday, Vestas, the Danish wind-turbine company won a court order for the bailiffs to end the workers’ occupation aimed at preventing closure of their factory on the Isle of Wight in the UK. Earlier in the day, in South Korea, police commandos descended from helicopters onto the roofs of the Ssangyong car assembly plant in Pyeongtaek, about 80 km south of the capital Seoul, to try and break the occupation by workers trying to protect their jobs. The police commandos stopped short of trying to storm the paint shop after fierce resistance from the workers inside, who were armed with metal pipes, firebombs and projectiles launched by catapults.

As the crisis deepens and workers are forced to fight for their livelihoods they will increasingly find themselves confronted by the capitalist state and its forces. In Britain, this takes the form of the courts, the police and bailiffs and the government. All are dedicated to upholding the legal right to private property – the basis of capitalist exploitation.

Now we must move beyond protest, turning our attention to composting the capitalist economic system and the state which defends it. In the end, “their” property has to become ours if we are to tackle the economic crisis in the interests of ordinary people and not the rich and powerful.

Gerry Gold
Economics editor

Parliament is beyond reform

When right-wing newspapers call for “revolution not reform” and leading Tory writers claim that the bond between rulers and ruled is “irreparably ruptured”, you can gauge the measure of the constitutional crisis now sweeping through the British state.

The Parliamentary system is in meltdown following the revelations about large-scale abuse of the Commons’ expenses system, whereby MPs of all the major parties claimed for just about everything, including mortgages already paid off. And not just backbench MPs either. The Cabinet has been at it too. Chancellor Alistair Darling is a serial tax evader who “flipped” the designation of his main residence four times in as many years to claim the maximum expenses.

This crisis is exericising the right wing, who perhaps sense the consequences better than the liberal media. Peter Oborne (whose book The Triumph of the Political Class foreshadowed what has been revealed) says: “This is hypocrisy of the most staggering order. The scandalous revelations over the past week about MPs' expenses have destroyed any concept of Britain having a virtuous governing class and have also irreparably ruptured the bond between rulers and ruled.” Fraser Nelson, writing in the Murdoch-owned News of the World, went further, declaring: “What started as a scandal is mutating into a constitutional crisis. And one that will have to end not just in reform, but in revolution.”

The scandal reveals not just a loss of confidence in the major parties but also, more significantly, in the parliamentary state itself in a way not seen before in modern British history. By and large, the majority have consented to the present system of government on the condition that it would a) act as a buffer between capitalists and citizens b) provide key services like housing, education, health and pensions c) protect liberties and human rights and d) protect the country from external threats.

That political bargain has broken down, a victim of corporate-driven globalisation which itself has now produced the prospect of the greatest economic and financial crash in history. Capitalism has been let rip in society, first under Thatcher and then courtesy of New Labour. The imposition of naked market forces has undermined not just areas like housing and pensions but also reinforced rampant individualism.

It’s easy to see the greed of MPs as a reflection of the atmosphere created in society at large. After all, why should they be excluded from making money by buying and selling homes just because they were MPs? Apart from siding with corporate and financial interests, the capitalist state under New Labour has destroyed many human rights and engaged in illegal wars in Iraq and Afghanistan that have actually increased the threat to the safety of ordinary people.

So the expenses scandal has brought to the surface frustrations that have been boiling up over decades. During the 1945 period, turnout at elections, for example, has plummeted from 83.9% in 1950 to 59.4% in 2001. It rose slightly in 2005, still leaving New Labour victorious with the votes of just one in four of the registered electorate.

Now it is reported that large numbers of the electorate plan to vote for smaller parties at the June 4 European elections in order to “punish” the major parties caught up in sleazegate. This includes the Greens as well as two far right parties, the BNP (which is cashing in on New Labour’s abandonment of low-paid white workers) and UKIP.

When a social or political institution fails, it’s time to move history on. This could be achieved, for example, through the calling of a People’s Convention for Democracy, charged with drawing up and then implementing a written democratic constitution. Delegates would be drawn from all ordinary sections of the community but exclude the rich and the powerful who are responsible for first the economic and now the political crisis. Instead of being cast as bystanders, we should seize the initiative before the right wing uses the expenses' scandal to close down the democratic process altogether.

The Convention’s aim should be the transfer of power not just from the corrupt political elites but also from the minority who have run the economy into the sands. In short, we need a revolutionary new system of government that goes beyond mere representation to forms of direct democracy in all areas of society, including the workplace. If Parliament is to have any future, it has to be in this context because it is certainly beyond reform.

Paul Feldman
AWTW communications editor

End a system that wrecks lives

This government is interested only in saving capitalism, not jobs. That’s the meaning of today’s unemployment figures, which show that people’s lives are being wrecked by a system that’s breaking apart. That’s the significance of writing a blank cheque to bankers, who promptly hoard taxpayers’ money to bolster their shattered balance sheets, while jobs disappear in their tens of thousands.   

No one knows how much the state has pledged to the bankers because the government refuses to come clean on that one; what we do know, however, is not a single penny has gone to save one job since the crisis exploded last summer. So official figures show that unemployment in November reached 1.92 million in November last year, a rise of more than 131,000 in three months. The real total is bound to be higher because many people do not register while others from outside the UK, like Polish workers, have simply returned home. 

Anyone looking for a positive response from New Labour will have to forget it. All employment minister Tony McNulty could say was that the figures were "very disappointing" and predicted things would "get worse before they get better". Just what sacked workers wanted to hear as they search for the address of their local unemployment office (aka “Job Centres”). 

McNulty and his fellow ministers labour under the illusion that bailing out the banks will get them lending again and that the economy will magically revive. This says more about New Labour’s infatuation with finance than it does about the government’s ability to grasp even the bare essentials of how capitalism operates. 

The global banking crisis actually expresses processes within the “real economy” and not the other way round. So long as the world economy continued to grow, and people repaid their borrowings, the merry-go-round could continue. As long ago as 2006, however, some American households hit by falling income, stopped paying their mortgages and the rest, as they say, is history. 

Suddenly exposed to the light of day were the results of the tendency for capitalism to over-produce commodities which consumers cannot purchase out of their normal income. This obvious contradiction itself expresses the predisposition for the rate of profit to fall as output per worker increases. Today’s crisis is thus the unravelling of this fatal flaw at the heart of present capitalist economic social relations. 

Not that New Labour could or would do anything to resolve this paradox, even if it could understand what was going on. For one, the state is capitalist in its nature and cannot, therefore, act in a way that challenges private ownership of big business and finance run for profit as the basis of the economy. Moreover, there is an objective, unstoppable momentum to the economic crisis which capitalist governments are incapable of arresting. 

You could actually see this in a graphic way yesterday, both in Britain and the United States. As the markets digested the second Brown government bail-out, shares and the pound fell sharply. Even as Obama was sworn in as president, banking shares nosedived on Wall Street. Firms continued to announce redundancies and closures because orders had dried up. 

Yet, you can conceive of a state and a government that could act. One that would order a halt to redundancies and closures pending a reorganisation of the economy on co-operative lines. A state that would switch funds from the banks to pay the unemployed the average wage while the economy was reorganised. A government that would reconstitute the financial system on the basis of mutual ownership and control. A democratically-controlled political system that would issue a clarion call to workers in other countries to do the same. Getting to this point requires decisive, conscious revolutionary action. 

Paul Feldman
AWTW communications editor

Naive and dangerous

As the global credit crisis lurches out of control, you can always find some consolation if you look hard enough, especially if you are a Guardian columnist with words of advice for the political and financial élites who are allegedly in control.

Economics editor Larry Elliott believes that financial market mayhem makes the case for returning to some golden age of regulated capitalism and the policies of the economist Keynes, after which everything will be more or less just hunky dorry. Unfortunately for him, the globalisation of financial markets alongside transnational corporations make this scenario a pipe-dream.

But wait. Today, comment editor Seumas Milne sees hope for the future in the actions of the state in response to the convulsions in the global financial system. “What,” he writes, “last week seemed outlandish becomes today's common sense”. After rather stupidly attacking the Tories for being “irrelevant” (if only that were true!), Milne says the scope for “piecemeal interventions may be coming to an end”, adding:

“In particular, if the HBOS deal, the last rampart of a private solution, were to unravel, there is already speculation that wholesale nationalisation of banks could become unavoidable.” Milne, who likes to think himself as a man of the Left, is particularly infatuated with what’s going on in America, declaring: “When a US Republican treasury secretary comes up with a $700bn bank rescue package, the potential of what governments can do with political will is thrown into unusually sharp relief.”

So all that’s lacking is the “political will”? Milne’s touching faith in the state to provide the answers and solve the crisis is extremely dangerous as well as naïve. When he writes that “the battle has been won over the necessity of intervention”, he is reinforcing the illusion that the crisis can some how be brought under control by a set of rational actions drawn up by the Guardian.

This assumes that the state is actually capable of imposing some sort of order and that this in itself would be a good thing. All the evidence is that recession is turning to slump and the state can do nothing about it, except try to save capitalism from itself at the expense of jobs, homes and living standards. And lest Milne, who has a reputation as an apologist for Stalinism, has forgotten his history, we should remind him that when the capitalist state comes together with corporate and financial power it equals fascism.

We have a double bind. The mass of the people are disenfranchised because the major parties stand for the same thing. And the state is openly the plaything of big business and finance. So the challenge is to create a new democratic politics and state that can propose a sane economic system based on production for need and not profit. Working on that project would be more fruitful than expecting the capitalist state to somehow become progressive in the midst of the gravest crisis since the 1930s.

Paul Feldman
Communications editor