Posts Tagged ‘capitalism’

“The United States is the most successfully repressed country in the world ” – Stokely Carmichael, Black power activist.

“Repression is when you can get 90% of the students in the U.S to name you all the Three Stooges but can’t tell you what the WTO is.” – Michael Parenti

“The People are the very substance of Power. We have to organise.” – Michael Parenti

A classic talk from 1999 by political scientist Michael Parenti.
It’s just as illuminating today as it was then–and often funny, too.

Parenti shows how the Western colonial powers un-developed the “Third-World”–increasing poverty there in order to enrich private corporations at home.
Indeed (Parenti argues), almost all U.S. foreign policy seems aimed at increasing the profits of the Fortune 500.

This is the real purpose of the hundreds of U.S. military interventions abroad–many of which overthrew democratically elected governments, replacing them with dictatorships friendly to U.S. corporate interests. Boosting corporate profits likewise is the reason behind “humanitarian” military interventions.

Parenti shows that imperialism’s current form is “multilateral free-trade agreements” such as NAFTA and GATT.
These draconian, anti-democratic treaties give corporations the power to veto any national laws that might interfere with their profits.

Parenti’s brilliant, passionate, and funny talk is as relevant today as it was in 1999.


Globalization And Democracy: 

Some Basics

By Michael Parenti

26 May, 2007
Michaelparenti.org


The goal of the transnational corporation is to become truly transnational, poised above the sovereign power of any particu­lar nation, while being served by the sovereign powers of all nations.

Cyril Siewert, chief financial officer of Colgate Palmol­ive Company, could have been speaking for all transnationals when he remarked, “The United States doesn’t have an automatic call on our [corporation’s] resources. There is no mindset that puts this country first.”[i]

With international “free trade” agreements such as NAFTA, GATT, and FTAA, the giant transnationals have been elevated above the sovereign powers of nation states. These agreements endow anonymous international trade committees with the authority to prevent, over-­rule, or dilute any laws of any nation deemed to burden the investment and market prerogatives of transnational corporations. These trade committees–of which the World Trade Organization (WTO) is a prime example—set up panels composed of “trade special­ists” who act as judges over economic issues, placing themselves above the rule and popular control of any nation, thereby insuring the supremacy of international finance capital. This process, called globalization, is treated as an inevitable natural “growth” development beneficial to all. It is in fact a global coup d’état by the giant business interests of the world.

Elected by no one and drawn from the corporate world, these panelists meet in secret and often have investment stakes in the very issues they adjudicate, being bound by no con­flict-of-interest provisions. Not one of GATT’s five hundred pages of rules and restrictions are directed against private corporations; all are against govern­ments.
Signatory governments must lower tariffs, end farm subsidi­es, treat foreign companies the same as domestic ones, honour all corporate patent claims, and obey the rulings of a permanent elite bureaucracy, the WTO. Should a country refuse to change its laws when a WTO panel so dictates, the WTO can impose fines or international trade sanctions, depriving the resistant country of needed markets and materials.[ii]

Acting as the supreme global adjudicator, the WTO has ruled against laws deemed “barriers to free trade.” It has forced Japan to accept greater pesticide residues in imported food. It has kept Guatemala from outlawing deceptive advertising of baby food. It has eliminated the ban in various countries on asbestos, and on fuel-economy and emission stan­dards for motor vehicles. And it has ruled against marine-life protection laws and the ban on endangered-species products. The European Union’s prohibition on the importation of hormone-ridden U.S. beef had overwhelming popular support throughout Europe, but a three-member WTO panel decided the ban was an illegal restraint on trade. The decision on beef put in jeopardy a host of other food import regulations based on health concerns. The WTO overturned a portion of the U.S. Clean Air Act banning certain additives in gasoline because it interfered with imports from foreign refineries. And the WTO overturned that portion of the U.S. Endangered Species Act forbidding the import of shrimp caught with nets that failed to protect sea turtles.[iii]

Free trade is not fair trade; it benefits strong nations at the expense of weaker ones, and rich interests at the expense of the rest of us. Globalization means turning the clock back on many twentieth-century reforms: no freedom to boycott products, no prohibitions against child labor, no guaranteed living wage or benefits, no public services that might conceivably compete with private services, no health and safety protections that might cut into corporate profits.[iv]

GATT and subsequent free trade agreements allow multinationals to impose monopoly property rights on indigenous and communal agriculture.
In this way agribusiness can better penetrate locally self-sufficient communities and monopolize their resources.
Ralph Nader gives the example of the neem tree, whose extracts contain natural pesti­cidal and medicinal proper­ties.
Cultivat­ed for centuries in India, the tree attracted the attention of vari­ous pharmaceutical companies, who filed monopoly patents, causing mass protests by Indian farmers. As dictated by the WTO, the pharmaceuticals now have exclusive control over the marketing of neem tree products, a ruling that is being reluctantly enforced in India.
Tens of thousands of erstwhile independent farmers must now work for the powerful pharmaceuticals on profit-gorging terms set by the companies.

A trade agreement between India and the United States, the Knowledge Initiative on Agriculture (KIA), backed by Monsanto and other transnational corporate giants, allows for the grab of India’s seed sector by Monsanto, its trade sector by Archer Daniels Midland and Cargill, and its retail sector by Wal-Mart. (Wal-Mart announced plans to open 500 stores in India, starting in August 2007.)
This amounts to a war against India’s independent farmers and small businesses, and a threat to India’s food security.
Farmers are organizing to protect themselves against this economic invasion by maintaining traditional seed-banks and setting up systems of communal agrarian support.
One farmer says, “We do not buy seeds from the market because we suspect they may be contaminated with genetically engineered or terminator seeds.”[v]

In a similar vein, the WTO ruled that the U.S. corporation RiceTec has the patent rights to all the many varieties of basmati rice, grown for centuries by India’s farmers.
It also ruled that a Japanese corporation had exclusive rights in the world to grow and produce curry powder. As these instances demonstrate, what is called “free trade” amounts to international corporate monopoly control.
Such developments caused Malaysian prime minister Mahathir Mohamad to observe:

We now have a situation where theft of genetic resources by western biotech TNCs [transnational corporations] enables them to make huge profits by producing patented genetic mutations of these same materials. What depths have we sunk to in the global marketplace when nature’s gifts to the poor may not be protected but their modifications by the rich become exclusive property?

If the current behaviour of the rich countries is anything to go by, globalization simply means the breaking down of the borders of countries so that those with the capital and the goods will be free to dominate the markets.[vi]

Under free-trade agreements like General Agreements on Trade and Services (GATS) and Free Trade Area of the Americas (FTAA), all public services are put at risk. A public service can be charged with causing “lost market opportunities” for business, or creating an unfair subsidy.

To offer one in­stance: the single-payer automobile insurance program proposed by the province of Ontario, Canada, was declared “unfair competi­tion.” Ontario could have its public auto insurance only if it paid U.S. insurance companies what they estimated would be their present and future losses in Ontario auto insurance sales, a prohibitive cost for the province.
Thus the citizens of Ontario were not allowed to exercise their democratic sovereign right to institute an alterna­tive not-for-profit auto insurance system. In another case, United Postal Service charged the Canadian Post Office for “lost market opportunities,” which means that under free trade accords, the Canadian Post Office would have to compensate UPS for all the business that UPS thinks it would have had if there were no public postal service. The Canadian postal workers union has challenged the case in court, arguing that the agreement violates the Canadian Constitution.

Under NAFTA, the U.S.-based Ethyl Corporation sued the Canadian government for $250 million in “lost business opportunities” and “interference with trade” because Canada banned MMT, an Ethyl-produced gasoline additive considered carcinogenic by Canadian officials. Fearing they would lose the case, Canadian officials caved in, agreeing to lift the ban on MMT, pay Ethyl $10 million compensation, and issue a public statement calling MMT “safe,” even though they had scientific findings showing otherwise. California also banned the unhealthy additive; this time a Canadian based Ethyl company sued California under NAFTA for placing an unfair burden on free trade.[vii]

International free trade agreements like GATT and NAFTA have hastened the corporate acquisition of local markets, squeezing out smaller businesses and worker collectives. Under NAFTA better-paying U.S. jobs were lost as firms closed shop and contracted out to the cheaper Mexican labor market. At the same time thousands of Mexican small companies were forced out of business. Mexico was flooded with cheap, high-tech, mass produced corn and dairy products from giant U.S. agribusiness firms (themselves heavily subsidized by the U.S. government), driving small Mexican farmers and distributors into bankruptcy, displacing large numbers of poor peasants. The lately arrived U.S. companies in Mexico have offered extremely low-paying jobs, and unsafe work conditions. Generally free trade has brought a dramatic increase in poverty south of the border.[viii]

We North Americans are told that to remain competitive in the new era of globalization, we will have to increase our output while reducing our labor and production costs, in other words, work harder for less. This in fact is happening as the work-week has lengthened by as much as twenty percent (from forty hours to forty-six and even forty-eight hours) and real wages have flattened or declined during the reign of George W. Bush. Less is being spent on social services, and we are enduring more wage conces­sions, more restructuring, deregula­tion, and privat­ization. Only with such “adjustments,” one hears, can we hope to cope with the impersonal forces of globalization that are sweeping us along.

In fact, there is nothing impersonal about these forces. Free trade agreements, including new ones that have not yet been submitted to the U.S. Congress have been consciously planned by big business and its government minions over a period of years in pursuit of a deregulated world economy that undermines all democratic checks upon business practices. The people of any one province, state, or nation are now finding it increasingly difficult to get their govern­ments to impose protective regulations or develop new forms of public sector production out of fear of being overruled by some self-appointed international free-trade panel.[ix]

Usually it is large nations demanding that poorer smaller ones relinquish the protections and subsidies they provide for their local producers. But occasionally things may take a different turn. Thus in late 2006 Canada launched a dispute at the World Trade Organization over the use of “trade-distorting” agricultural subsidies by the United States, specifically the enormous sums dished out by the federal government to U.S. agribusiness corn farmers. The case also challenged the entire multibillion-dollar structure of U.S. agricultural subsidies. It followed the landmark WTO ruling of 2005 which condemned “trade-distorting” aid to U.S. cotton farmers. A report by Oxfam International revealed that at least thirty-eight developing countries were suffering severely as a result of trade distorting subsidies by both the United States and the European Union. Meanwhile, the U.S. government was manoeuvring to insert a special clause into trade negotiations that would place its illegal use of farm subsidies above challenge by WTO member countries and make the subsidies immune from adjudication through the WTO dispute settlement process.[x]

What is seldom remarked upon is that NAFTA and GATT are in violation of the U.S. Constitution, the preamble of which makes clear that sovereign power rests with the people: “We the People of the United States . . . do ordain and establish this Constitution for the United States of America.” Article I, Section 1 of the Constitution reads; “All legislative Powers herein granted shall be vested in a Congress of the United States.” Article I, Section 7 gives the president (not some trade council) the power to veto a law, subject to being overridden by a two-thirds vote in Congress. And Article III gives adjudication and review powers to a Supreme Court and other federal courts as ordained by Congress.

The Tenth Amendment to the Constitution states:

“The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.”

There is nothing in the entire Constitution that allows an international trade panel to preside as final arbiter exercising supreme review powers undermining the constitutionally mandated decisions of the legislative, executive, and judicial branches.

True, Article VII says that the Constitution, federal laws, and treaties “shall be the supreme Law of the land,” but certainly this was not intended to include treaties that overrode the laws themselves and the sovereign democratic power of the people and their representatives.

To exclude the Senate from deliberations, NAFTA and GATT were called “agreements” instead of treaties, a semantic ploy that enabled President Clinton to bypass the two-third treaty ratification vote in the Senate and avoid any treaty amendment process. The World Trade Organization was approved by a lame-duck session of Congress held after the 1994 elections. No one running in that election uttered a word to voters about putting the U.S. government under a perpetual obligation to insure that national laws do not conflict with international free trade rulings.

What is being undermined is not only a lot of good laws dealing with environment, public services, labor standards, and consumer protection, but also the very right to legislate such laws. Our democratic sovereignty itself is being surrendered to a secretive plutocratic trade organization that presumes to exercise a power greater than that of the people and their courts and legislatures. What we have is an international coup d’état by big capital over the nations of the world.

Globalization is a logical extension of imperialism, a victory of empire over republic, international finance capital over local productivity and nation-state democracy (such as it is). In recent times however, given popular protests, several multilateral trade agreements have been stalled or voted down. In 1999, militant protests against free trade took place in forty-one nations from Britain and France to Thailand and India.[xi] In 2000-01, there were demonstrations in Seattle, Washington, Sydney, Prague, Genoa, and various other locales. In 2003-04 we saw the poorer nations catching wise to the free trade scams and refusing to sign away what shreds of sovereignty they still had. Along with the popular resistance, more national leaders are thinking twice before signing on to new trade agreements.

The discussion of globalization by some Marxists (but not all) has focused on the question of whether the new “internationalization” of capital will undermine national sovereignty and the nation state. They dwell on this question while leaving unmentioned such things as free trade agreements and the WTO. Invariably these observers (for instance Ellen Wood and William Taab in Monthly Review, Ian Jasper in Nature, Society and Thought, Erwin Marquit in Political Affairs) conclude that the nation state still plays a key role in capitalist imperialism, that capital-while global in its scope–is not international but bound to particular nations, and that globalization is little more than another name for overseas monopoly capital investment.

They repeatedly remind us that Marx had described globalization, this process of international financial expansion, as early as 1848, when he and Engels in the Communist Manifesto wrote about how capitalism moves into all corners of the world, reshaping all things into its own image. Therefore, there is no cause for the present uproar. Globalization, these writers conclude, is not a new development but a longstanding one that Marxist theory uncovered long ago.

The problem with this position is that it misses the whole central point of the current struggle. It is not only national sovereignty that is at stake, it is democratic sovereignty. Millions, of people all over the world have taken to the streets to protest free trade agreements. Among them are farmers, workers, students and intellectuals (including many Marxists who see things more clearly than the aforementioned ones), all of whom are keenly aware that something new is afoot and they want no part of it. As used today, the term globalization refers to a new stage of international expropriation, designed not to put an end to the nation-state but to undermine whatever democratic right exists to protect the social wage and restrain the power of transnational corporations.

The free trade agreements, in effect, make unlawful all statutes and regulations that restrict private capital in any way. Carried to full realization, this means the end of whatever imperfect democratic protections the populace has been able to muster after generations of struggle in the realm of public policy. Under the free trade agreements any and all public services can be ruled out of existence because they cause “lost market opportunities” for private capital. So too public hospitals can be charged with taking away markets from private hospitals; and public water supply systems, public schools, public libraries, public housing and public transportation are guilty of depriving their private counterparts of market opportunities, likewise public health insurance, public mail delivery, and public auto insurance systems.

Laws that try to protect the environment or labor standards or consumer health already have been overthrown for “creating barriers” to free trade.

What also is overthrown is the right to have such laws. This is the most important point of all and the one most frequently overlooked by persons from across the political spectrum. Under the free trade accords, property rights have been elevated to international supremacy, able to take precedent over all other rights, including the right to a clean livable environment, the right to affordable public services, and the right to any morsel of economic democracy. Instead a new right has been accorded absolutist status, the right to corporate private profit. It has been used to stifle the voice of working people and their ability to develop a public sector that serves their interests.

Free speech itself is undermined as when “product disparagement” is treated as an interference with free trade. And nature itself is being monopolized and privatized by transnational corporations.

So the fight against free trade is a fight for the right to politico-economic democracy, public services, and a social wage, the right not to be completely at the mercy of big capital. It is a new and drastic phase of the class struggle that some Marxists–so immersed in classical theory and so ill-informed about present-day public policy–seem to have missed. As embodied in the free trade accords, globalization has little to do with trade and is anything but free. It benefits the rich nations over poor ones, and the rich classes within all nations at the expense of ordinary citizens. It is the new specter that haunts the same old world.

Michael Parenti’s recent books include The Assassination of Julius Caesar (New Press), Superpatriotism (City Lights), and The Culture Struggle (Seven Stories Press). For more information visit: www.michaelparenti.org.


© 2007 Michael Parenti

[i] Quoted in New York Times, May 21, 1989.[ii] See Lori Wallach and Michelle Sforza, The WTO (New York: Seven Stories Press, 2000); and John R. MacArthur, The Selling of Free Trade: Nafta, Washington, and the Subversion of American Democracy (New York: Hill and Wang, 2000).

[iii] New York Times, April 30, 1996 and May 9, 1997;Washington Post, October 13, 1998.

[iv] See the report by the United Nations Development Program referenced in New York Times, July 13, 1999.

[v] Project Censored, “Real News,” April 2007; also Arun Shrivastava, “Genetically Modified Seeds: Women in India take on Monsanto,” Global Research, October 9, 2006.

[vi] Quoted in People’s Weekly World, December 7, 1996.

[vii] John R. MacArthur, The Selling of “Free Trade”: NAFTA, Washington, and the Subversion of American Democracy (New York: Hill & Wang, 2000; and Sarah Anderson and John Cavanagh, “Nafta’s Unhappy Anniversary,” New York Times, February 7, 1995.

[viii] John Ross, “Tortilla Wars,” Progressive, June 1999

[ix] For a concise but thorough treatment, see Steven Shrybman, A Citizen’s Guide

to the World Trade Organization (Ottawa/Toronto: Canadian Center for Policy

Alternatives and James Lorimer & Co., 1999).

[x] “US seeks “get-out clause” for illegal farm payments” Oxfam, June 29, 2006,

http://www.oxfam.org/en/news/
pressreleases2006/pr060629_wto_geneva

[xi] San Francisco Chronicle, June 19, 1999.

 

 

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Link: https://vimeo.com/149970851

Jarecki/ Why We Fight from Lawrence Christopher Skufca on Vimeo.

Synopsis:

Documentary filmmaker Eugene Jarecki’s in-depth look at how the United States has built the largest peace time military/corporate/industrial complex in the history of the World.

The film received the Grand Jury Prize at the 2005 Sundance Film Festival and raises important moral and ethical questions about the revolving door between our government and the defence contractor industry and the underlying economic decisions which influence U.S. policymakers to lead the nation into war.

Fair Use.
This video contains copyrighted material. Such material is made available for educational purposes only in an effort to advance the understanding of human rights and social justice issues and is distributed without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. This constitutes a ‘fair use’ of any such copyrighted material in accordance with Title 17 U.S.C. Section 107 of the U.S. Copyright Law.

A superb piece from George Monbiot, covering a lot of ground about a system that some people are not even aware exists. It is important that people start to wake up to the this. We are sleep walking our way towards disaster, be it climate change, economic and social collapse or catastrophic war.


Neoliberalism – the ideology at the root of all our problems

Financial meltdown, environmental disaster and even the rise of Donald Trump – neoliberalism has played its part in them all. Why has the left failed to come up with an alternative?

Ronald Reagan and Margaret Thatcher at the White House.

 

Imagine if the people of the Soviet Union had never heard of communism.

The ideology that dominates our lives has, for most of us, has no name.
Mention it in conversation and you’ll be rewarded with a shrug.
Even if your listeners have heard the term before, they will struggle to define it.

Neoliberalism: do you know what it is?
Its anonymity is both a symptom and cause of its power. It has played a major role in a remarkable variety of crises:
the financial meltdown of 2007‑8,
the offshoring of wealth and power, of which the Panama Papers offer us merely a glimpse,
the slow collapse of public health and education,
resurgent child poverty,
the epidemic of loneliness,
the collapse of ecosystems,
the rise of Donald Trump.

But we respond to these crises as if they emerge in isolation, apparently unaware that they have all been either catalysed or exacerbated by the same coherent philosophy; a philosophy that has – or had – a name.

What greater power can there be than to operate namelessly?

So pervasive has neoliberalism become that we seldom even recognise it as an ideology. We appear to accept the proposition that this utopian, millenarian faith describes a neutral force; a kind of biological law, like Darwin’s theory of evolution. But the philosophy arose as a conscious attempt to reshape human life and shift the locus of power.

Neoliberalism sees competition as the defining characteristic of human relations. It redefines citizens as consumers, whose democratic choices are best exercised by buying and selling, a process that rewards merit and punishes inefficiency. It maintains that “the market” delivers benefits that could never be achieved by planning.

Attempts to limit competition are treated as inimical to liberty. Tax and regulation should be minimised, public services should be privatised. The organisation of labour and collective bargaining by trade unions are portrayed as market distortions that impede the formation of a natural hierarchy of winners and losers.
Inequality is recast as virtuous: a reward for utility and a generator of wealth, which trickles down to enrich everyone.
Efforts to create a more equal society are both counterproductive and morally corrosive. The market ensures that everyone gets what they deserve.

We internalise and reproduce its creeds. The rich persuade themselves that they acquired their wealth through merit, ignoring the advantages – such as education, inheritance and class – that may have helped to secure it.

The poor begin to blame themselves for their failures, even when they can do little to change their circumstances.

  • Never mind structural unemployment: if you don’t have a job it’s because you are unenterprising.
  • Never mind the impossible costs of housing: if your credit card is maxed out, you’re feckless and improvident.
  • Never mind that your children no longer have a school playing field: if they get fat, it’s your fault.

In a world governed by competition, those who fall behind become defined and self-defined as losers. Among the results, as Paul Verhaeghe documents in his book What About Me? are epidemics of self-harm, eating disorders, depression, loneliness, performance anxiety and social phobia.

Perhaps it’s unsurprising that Britain, in which neoliberal ideology has been most rigorously applied, is the loneliness capital of Europe. We are all neoliberals now.

The term neoliberalism was coined at a meeting in Paris in 1938.

Among the delegates were two men who came to define the ideology, Ludwig von Mises and Friedrich Hayek. Both exiles from Austria, they saw social democracy, exemplified by Franklin Roosevelt’s New Deal and the gradual development of Britain’s welfare state, as manifestations of a collectivism that occupied the same spectrum as nazism and communism.

In The Road to Serfdom, published in 1944, Hayek argued that government planning, by crushing individualism, would lead inexorably to totalitarian control.
Like Mises’s book Bureaucracy, The Road to Serfdom was widely read. It came to the attention of some very wealthy people, who saw in the philosophy an opportunity to free themselves from regulation and tax. When, in 1947, Hayek founded the first organisation that would spread the doctrine of neoliberalism – the Mont Pelerin Society – it was supported financially by millionaires and their foundations.

With their help, he began to create what Daniel Stedman Jones describes in Masters of the Universe as “a kind of neoliberal international”: a transatlantic network of academics, businessmen, journalists and activists.

The movement’s rich backers funded a series of thinktanks which would refine and promote the ideology. Among them were the American Enterprise Institute, the Heritage Foundation, the Cato Institute, the Institute of Economic Affairs, the Centre for Policy Studies and the Adam Smith Institute. They also financed academic positions and departments, particularly at the universities of Chicago and Virginia.

As it evolved, neoliberalism became more strident. Hayek’s view that governments should regulate competition to prevent monopolies from forming gave way – among American apostles such as Milton Friedman – to the belief that monopoly power could be seen as a reward for efficiency.

Something else happened during this transition: the movement lost its name. In 1951, Friedman was happy to describe himself as a neoliberal. But soon after that, the term began to disappear. Stranger still, even as the ideology became crisper and the movement more coherent, the lost name was not replaced by any common alternative.

At first, despite its lavish funding, neoliberalism remained at the margins. The postwar consensus was almost universal: John Maynard Keynes’s economic prescriptions were widely applied, full employment and the relief of poverty were common goals in the US and much of western Europe, top rates of tax were high and governments sought social outcomes without embarrassment, developing new public services and safety nets.

But in the 1970s, when Keynesian policies began to fall apart and economic crises struck on both sides of the Atlantic, neoliberal ideas began to enter the mainstream. As Friedman remarked, “when the time came that you had to change … there was an alternative ready there to be picked up”.
With the help of sympathetic journalists and political advisers, elements of neoliberalism, especially its prescriptions for monetary policy, were adopted by Jimmy Carter’s administration in the US and Jim Callaghan’s government in Britain.

After Margaret Thatcher and Ronald Reagan took power, the rest of the package soon followed:
massive tax cuts for the rich,
the crushing of trade unions,
deregulation,
privatisation,
outsourcing and
competition in public services.
Through the IMF, the World Bank, the Maastricht treaty and the World Trade Organisation, neoliberal policies were imposed – often without democratic consent – on much of the world.

Most remarkable was its adoption among parties that once belonged to the left: Labour and the Democrats, for example. As Stedman Jones notes, “it is hard to think of another utopia to have been as fully realised.”

It may seem strange that a doctrine promising choice and freedom should have been promoted with the slogan “there is no alternative”.
But, as Hayek remarked on a visit to Pinochet’s Chile – one of the first nations in which the programme was comprehensively applied –

“my personal preference leans toward a liberal dictatorship rather than toward a democratic government devoid of liberalism”.

The freedom that neoliberalism offers, which sounds so beguiling when expressed in general terms, turns out to mean freedom for the pike, not for the minnows.

Freedom from trade unions and collective bargaining means;
the freedom to suppress wages.
Freedom from regulation means the freedom to poison rivers,
endanger workers,
charge iniquitous rates of interest and
design exotic financial instruments.
Freedom from tax means freedom from the distribution of wealth that lifts people out of poverty.

As Naomi Klein documents in The Shock Doctrine, neoliberal theorists advocated the use of crises to impose unpopular policies while people were distracted: for example, in the aftermath of Pinochet’s coup, the Iraq war and Hurricane Katrina, which Friedman described as; “an opportunity to radically reform the educational system” in New Orleans.

Where neoliberal policies cannot be imposed domestically, they are imposed internationally, through trade treaties incorporating “investor-state dispute settlement”: offshore tribunals in which corporations can press for the removal of social and environmental protections.

When parliaments have voted to restrict sales of cigarettes, protect water supplies from mining companies, freeze energy bills or prevent pharmaceutical firms from ripping off the state, corporations have sued, often successfully. Democracy is reduced to theatre.

Another paradox of neoliberalism is that universal competition relies upon universal quantification and comparison. The result is that workers, job-seekers and public services of every kind are subject to a pettifogging, stifling regime of assessment and monitoring, designed to identify the winners and punish the losers.
The doctrine that Von Mises proposed would free us from the bureaucratic nightmare of central planning has instead created one.

Neoliberalism was not conceived as a self-serving racket, but it rapidly became one. Economic growth has been markedly slower in the neoliberal era (since 1980 in Britain and the US) than it was in the preceding decades; but not for the very rich.
Inequality in the distribution of both income and wealth, after 60 years of decline, rose rapidly in this era, due to the smashing of trade unions, tax reductions, rising rents, privatisation and deregulation.

The privatisation or marketisation of public services such as energy, water, trains, health, education, roads and prisons has enabled corporations to set up tollbooths in front of essential assets and charge rent, either to citizens or to government, for their use. Rent is another term for unearned income.
When you pay an inflated price for a train ticket, only part of the fare compensates the operators for the money they spend on fuel, wages, rolling stock and other outlays.
The rest reflects the fact that they have you over a barrel.

Those who own and run the UK’s privatised or semi-privatised services make stupendous fortunes by investing little and charging much. In Russia and India, oligarchs acquired state assets through firesales. In Mexico, Carlos Slim was granted control of almost all landline and mobile phone services and soon became the world’s richest man.

Financialisation, as Andrew Sayer notes in Why We Can’t Afford the Rich, has had a similar impact. “Like rent,” he argues, “interest is … unearned income that accrues without any effort”.
As the poor become poorer and the rich become richer, the rich acquire increasing control over another crucial asset: money.
Interest payments, overwhelmingly, are a transfer of money from the poor to the rich.
As property prices and the withdrawal of state funding load people with debt (think of the switch from student grants to student loans), the banks and their executives clean up.

Sayer argues that the past four decades have been characterised by a transfer of wealth not only from the poor to the rich, but within the ranks of the wealthy: from those who make their money by producing new goods or services to those who make their money by controlling existing assets and harvesting rent, interest or capital gains.
Earned income has been supplanted by unearned income.

Neoliberal policies are everywhere beset by market failures. Not only are the banks too big to fail, but so are the corporations now charged with delivering public services. As Tony Judt pointed out in Ill Fares the Land, Hayek forgot that vital national services cannot be allowed to collapse, which means that competition cannot run its course.
Business takes the profits, the state keeps the risk.

The greater the failure, the more extreme the ideology becomes.
Governments use neoliberal crises as both excuse and opportunity to;
cut taxes,
privatise remaining public services,
rip holes in the social safety net,
deregulate corporations and
re-regulate citizens.

The self-hating state now sinks its teeth into every organ of the public sector. Perhaps the most dangerous impact of neoliberalism is not the economic crises it has caused, but the political crisis.
As the domain of the state is reduced, our ability to change the course of our lives through voting also contracts.
Instead, neoliberal theory asserts, “people can exercise choice through spending”.
But some have more to spend than others: in the great consumer or shareholder democracy, votes are not equally distributed. The result is a disempowerment of the poor and middle.
As parties of the right and former left adopt similar neoliberal policies, disempowerment turns to disenfranchisement.
Large numbers of people have been shed from politics.

Chris Hedges remarks that;

“fascist movements build their base not from the politically active but the politically inactive, the ‘losers’ who feel, often correctly, they have no voice or role to play in the political establishment”.

When political debate no longer speaks to us, people become responsive instead to slogans, symbols and sensation. To the admirers of Trump, for example, facts and arguments appear irrelevant.

Judt explained that when the thick mesh of interactions between people and the state has been reduced to nothing but authority and obedience, the only remaining force that binds us is state power.
The totalitarianism Hayek feared is more likely to emerge when governments, having lost the moral authority that arises from the delivery of public services, are reduced to “cajoling, threatening and ultimately coercing people to obey them”.

Like communism, neoliberalism is the God that failed.
But the zombie doctrine staggers on, and one of the reasons is its anonymity. Or rather, a cluster of anonymities.

The invisible doctrine of the invisible hand is promoted by invisible backers. Slowly, very slowly, we have begun to discover the names of a few of them. We find that the Institute of Economic Affairs, which has argued forcefully in the media against the further regulation of the tobacco industry, has been secretly funded by British American Tobacco since 1963. We discover that Charles and David Koch, two of the richest men in the world, founded the institute that set up the Tea Party movement.
We find that Charles Koch, in establishing one of his thinktanks, noted that
“in order to avoid undesirable criticism, how the organisation is controlled and directed should not be widely advertised”.

The words used by neoliberalism often conceal more than they elucidate. “The market” sounds like a natural system that might bear upon us equally, like gravity or atmospheric pressure. But it is fraught with power relations.
What “the market wants” tends to mean what corporations and their bosses want.

“Investment”, as Sayer notes, means two quite different things.

One is the funding of productive and socially useful activities,
the other is the purchase of existing assets to milk them for rent, interest, dividends and capital gains.

Using the same word for different activities “camouflages the sources of wealth”, leading us to confuse wealth extraction with wealth creation.

A century ago, the nouveau riche were disparaged by those who had inherited their money. Entrepreneurs sought social acceptance by passing themselves off as rentiers. Today, the relationship has been reversed: the rentiers and inheritors style themselves entrepreneurs. They claim to have earned their unearned income.

These anonymities and confusions mesh with the namelessness and placelessness of modern capitalism:

The anonymity of neoliberalism is fiercely guarded.
Those who are influenced by Hayek, Mises and Friedman tend to reject the term, maintaining – with some justice – that it is used today only pejoratively. But they offer us no substitute.
Some describe themselves as classical liberals or libertarians, but these descriptions are both misleading and curiously self-effacing, as they suggest that there is nothing novel about The Road to Serfdom, Bureaucracy or Friedman’s classic work, Capitalism and Freedom.

For all that, there is something admirable about the neoliberal project, at least in its early stages. It was a distinctive, innovative philosophy promoted by a coherent network of thinkers and activists with a clear plan of action. It was patient and persistent. The Road to Serfdom became the path to power.

 

DWP forced to reveal firms using benefit claimants for unpaid work after 4-year legal fight

Here’s the (very long) list of companies that took advantage of taxpayer-funded workers courtesy of the DWP.

Feel free to use the information in whatever way you see fit.

1. African Childrens Fund

2. Abacus Children’s Wear

3. ABCAL

4. Ability

5. Ace of Clubs Charity Shop

6. Acorns

7. Action for Disability

8. Action Housing

9. Active Community Team

10. Advocacy Support

11. Afro Caribbean Centre

12. Age Concern

13. Age UK

14. Agnew Community Centre

15. Air Ambulance

16. Aire Valley Recycling Ltd

17. Airedale Computers,

18. Al-Khair Foundation

19. All Aboard

20. Allied Healthcare

21. Almadene Care Home

22. AMF Torquay Bowling Alley

23. Amicus Horizon Housing Association

24. Animal Krackers

25. ARAS German Shepherd Inn

26. ARC

27. Archer Project

28. Arthritis Research UK

29. Arthur Rank

30. Arts Factory

31. ASAN

32. Asda

33. Asha Charity Shop

34. Ashgate Hospice

35. Aspire Community Enterprise Ltd

36. Auchinleck Talbot F.C.

37. Autism Plus

38. Aylestone Park Boys Football Club

39. Babygear

40. Back2Earth

41. Bangladesh People

42. Bangladeshi ass sangag centre

43. Barnardos

44. Basic Life Charity

45. B’Dwe

46. Beaumaris Hostel

47. Bedfordshire Education Academy

48. Belgrave Hall Museum

49. Bernicia Group (Social housing provider)

50. BHF

51. Blaby & Whetstone Boys Club

52. Blue Cross

53. Bluebell Wood

54. Bookers

55. Boots

56. Botanical Gardens

57. Bottle Rescue Aireworth Mill

58. BR Environmental

59. Bradford Autism Centre

60. Bradford Community repaint

61. Breaking Free

62. Brian Jackson House

63. Briardale Community Centre

64. Bright House

65. Brighton and hove wood recycling

66. Britannia College

67. British Heart Foundation

68. British Red Cross

69. British Waterways

70. Brockhurst Community Centre

71. Bryncynon Strategy

72. Bryncynon Strategy

73. Butterwick Hospice

74. Cancer Research

75. Cancer Uk

76. Capability Scotland

77. Care & Repair

78. Carers Centre

79. Caribbean Centre

80. Caribbean Restaurant (Streatham)

81. Carlisle Park

82. Carr Vale Allotments

83. Cash Convertors

84. Castle Gresley Community Centre

85. Cat Haven

86. Cats Protection League

87. Cauwood day services

88. CCA Furniture Outlet

89. Cerebal Palsey Care

90. Changing Lives in Clevedon

91. chapletown youth community centre

92. Chesterfield FC Community Trust

93. Chestnut Tree House Shop

94. Children in Distress

95. Children Scrapstore Reuse Centre

96. Children Trust

97. Childrens Society

98. Chopsticks North Yorkshire

99. Circulate

100. Citizen Advice Bureau

101. Claire House

102. Clic Sargent

103. Comfort Kids

104. Community Association – Trefechan

105. Community Re-Paint

106. Community Resource Centre

107. Community Voice

108. Complete Professional Care

109. Compton Hospice

110. Congburn Nurseries

111. Cooke Computers

112. Cooke E – Learning Foundation

113. Co-op

114. Corby Boating Lake

115. Cornerstone

116. Cornwall Hospice Care

117. County Durham Furniture Help Scheme

118. Croydon animal samaritans

119. CSV Media

120. Cusworth Hall

121. CVS Furniture

122. Dan’s Den Colwyn Bay

123. Dapp UK

124. DC Cleaning

125. Deans

126. Debra

127. Demzela

128. Derbyshire Timber Scheme

129. DHL

130. Dial Intake

131. Didcot Railyway Museum

132. Disabled Childrens Services

133. Discovery Community Cafe

134. Dogs Trust Glasgow

135. Dogsthorpe Recycling Centre

136. Doncaster College

137. Doncaster Community Centre

138. Dorothy House Hospice

139. Dorset Reclaim

140. Dovehouse Hospice Shop

141. Dragon Bands

142. Durham Wildlife Trust

143. E Waste Solutions

144. Earl Mountbatten Hospice

145. East Anglia Childrens Hospice Shop

146. East Cleveland Wildlife Trust

147. East Durham Partnership

148. East Midlands Islamic Relief Project

149. East West Community Project

150. Ecclesbourne Valley Railway

151. eco Innovation Centre

152. Elleanor Lion Hospice

153. ELVON

154. Encephalitis society

155. English Landscapes

156. Enhanced Care Training

157. Enterprise UK

158. Environmental Resource Centre

159. Essex County Council

160. Extra care Charitable Trust

161. Fable

162. Family Support

163. Fara

164. Fare share Malmo Food Park

165. Featherstone Rovers

166. Fenland District Council

167. First Fruits

168. FN! Eastbourne

169. Foal Farm

170. Food Cycle

171. Fops Shop

172. forget me not childrens hospice

173. Foundation for Paediatric Osteopathy

174. Fountain Abbey

175. Fox Rush Farm

176. FRADE

177. Frame

178. FRESCH

179. Fresh water christian charity

180. Friends of St Nicholas Fields

181. Furnish

182. Furniture for You

183. Furniture Project

184. FurnitureLink

185. Gateway funiture

186. Genesis Trust

187. George Thomas Hospice – Barry

188. Geranium Shop For The Blind

189. Glasgow Furniture Initative

190. Glen Street Play Provision

191. Goodwin Development Trust

192. Govanhill Baths Community Trust

193. Greenacres Animal Rescue Shop

194. Greenfingers

195. Greenscape

196. Greenstreams Huddersfield/ environmental alliance

197. Grimsby District Health care charity

198. Ground Work

199. Hadston House

200. Happy Staffie

201. Harlington Hospice

202. Hart Wildlife Rescue

203. Hartlepool Council

204. Hartlepool Hospice

205. Hartlepool Prop (Mental Health)

206. Hartlepool Trust Opening Doors

207. Hastings & Bexhill Wood Recycling Project

208. Havens Childrens Hospice Shop

209. Havering Country Park

210. headway

211. Healthy Living Centre

212. Hebburn Community Centre

213. Help the Aged

214. Helping Hands

215. High Beech Care Home

216. High Wycombe Central Aid

217. Hillam Nurseries

218. Hinsley Hall Headingley

219. Hobbit Hotel

220. Holmescarr Community Centre

221. Home Start

222. Homemakers

223. Hope central

224. Hospice of hope

225. Hounslow Community Transport Furniture Project

226. Hull Animal Welfare Trust Hull

227. Humanity at Heart

228. I Trust

229. Indoamerican Refugee and Migrant Organisation (IRMO)

230. Intraining Employers

231. Ipswich Furniture Project

232. Iranian Association

233. Islamic Relief

234. Jacabs Well Care Center

235. Jesus Army Centre

236. JHP

237. Julian House Charity Shop

238. K.T. Performing Arts

239. Kagyu Samye Dzong London

240. Keech Hospice Care Shop

241. Keighley & District Disabled

242. Kier Services – Corby

243. Kilbryde Hospice

244. Killie Can Cycle

245. Kingston Community Furniture Project

246. Kiveton Park & Wales Community Development Trust

247. LAMH

248. Leeds & Moortown Furniture Store

249. Leicester City Council

250. Leicester Riders

251. Leicester Shopmobility

252. Leicestershire Aids Support Services

253. Leicestershire Cares

254. Lifework

255. Lighthouse

256. Linacre Reservoir

257. London Borough of Havering

258. London College of Engineering & Management Woolwich

259. Longley Organised Community Association

260. Lyme Trust

261. Lynemouth Resource Centre

262. Mackworth Comm. Charity Shop

263. Making a Difference

264. Marie Curie

265. Mark2 (marc)

266. Martin House Hospice

267. Mary Stevens Hospice

268. Matalan

269. Matchbox

270. Matthew25 Mission

271. Mayflower Sanctuary

272. MDJ Lightbrothers

273. Meadow Well Connected

274. MEC

275. Mental Health Support

276. Midland Railway Trust

277. MIND

278. Miners Welfare community centre

279. Mistley Place Park

280. Monmouthshire & Brecon Canal Regeneration Partnership Scheme

281. Moore Cleaning

282. Morrisons

283. Muslim Aid

284. Myton Hospice

285. Nandos

286. Naomi Hospice

287. National Railway Museum

288. National Trust

289. NDDT

290. Neath Port Talbot County Borough Council

291. Necessary Furniture

292. Neighbourhood funiture

293. Neterlands Dog Rescue

294. New Life Church

295. Newham Volenteers Group

296. Newport City Council

297. Nightingale House

298. NOAH enterprise

299. North East Lincs Motor Project

300. North London Hospice Shop

301. North Ormesby Community Shop

302. Northumberland County Council

303. Norwood

304. Old Nick Theatre

305. One 0 One

306. Open Secret

307. Overgate Hospice

308. Oxfam

309. Papworth Trust

310. Partner Shop

311. Paul Sartori Warehouse

312. Paws Animal Welfare Shop

313. PDSA

314. Pegswood Community Centre

315. Pennywell Community Association

316. Peterborough Streets

317. Pheonix Community Furniture

318. Pilgrim Hospice

319. Placement Furniture Project

320. Platform 51 Doncaster Womens Centre

321. Playworks

322. Plymouth Food Bank

323. Plymouth Play Association

324. Plymouth Volunteer Centre

325. Pound stretcher

326. POW Shop

327. Powys Animal Welfare Shop

328. PPE Paving

329. Preen Community Interest Company

330. Primrose

331. PRINCE & PRINCESS OF WALES

332. Prince of Wales Sherburn in elmet

333. Princess Trust

334. Queen Elizabeth Foundation

335. Queens Walk Community

336. Queensland Multi-Media Arts Centre

337. Rainbow Centre

338. Rainbows End Burngreave

339. Real Time Music

340. Recycling unlimited

341. Red Cross

342. Refurnish

343. Regenerate Community Enterprise

344. Remploy

345. Restore

346. Rhyl Adventure Playground Association

347. Right Time Foundation

348. RNID

349. Rochford Council

350. Rosalie Ryrie Foundation

351. Rosliston Foresty

352. Royal Society for Blind.

353. Royal Wotton Bassett Town Council

354. RSPB

355. RSPCA

356. Rudenotto

357. Rudyard Lake

358. S & S Services

359. Saffcare

360. Sainsburys

361. Salvation Army

362. Santosh Community Centre

363. Sara

364. Save the children

365. Savera Resource Centre

366. Scallywags

367. Scarborough Council

368. SCD Fabrications

369. School of English Studies

370. Scope

371. Scottish Cancer Support

372. Scottish International Relief

373. Scunthorpe Central Community Centre

374. Seagull Recycling

375. Seahouses Development Trust

376. Second Chance

377. Second Opportunities

378. Sedgemoor Furniture Store

379. Sense

380. Sesku Acadamy Centre

381. Shaw Trust

382. Sheffield Reclamation Ltd – Reclaim

383. Shelter

384. Shooting Stars

385. Shopmobility & Community Transport – Access

386. Slough Furniture Project

387. Smythe

388. Sneyd Green

389. Somali Community Parents Association

390. Somerfields

391. Somerset Wood Re-Cycling

392. South Ayrshire Council

393. South Bucks Hospice Warehouse

394. South Wales Boarders Museum

395. Southend United Football Club

396. Spaghetti House

397. Spitafields Crypt Trust

398. Splash fit

399. St Barnabas

400. St Catherines Hospice Trading

401. St Chads Community Centre

402. St Clare’s Hospice

403. St Davids Foundation

404. St Elizabeth Hospice Charity Shop

405. St Francis Hospice Shops Ltd

406. St Gemma’s Hospice

407. St Georges Crypt

408. St Giles

409. St Helens House

410. St Hughs Community Centre

411. St Lukes Hospice

412. St Margarets Hospice Scotland

413. St Oswald’s Hospice

414. St Peters Church

415. St Peters Hospice

416. St Raphaels hospice

417. St Vincents

418. St. Catherines Hospice

419. St.Theresa’s Charity Shop

420. Stages Café

421. Stannah Stair Lifts

422. Stef’s Farm (Education Farm)

423. Step Forward

424. Stocking Farm Healthy Living Centre ( Sure Start)

425. Stockton Council

426. Stone Pillow

427. STROKECARE

428. Strood Community Project

429. Strut Lincoln

430. Sudbury Town Council

431. Sue Ryder

432. Sunderland Community Furniture

433. Sunderland North Community Business Centre

434. Superdrug

435. Swindon 105.5

436. Sycamore Lodge

437. sydney bridge furniture shop

438. Sypha

439. T&M Kiddy’s Kingdom

440. Tara Handicrafts

441. Teamwork

442. Teesside Hospice

443. Tendring Furniture Scheme

444. Tendring Reuse & Employment Enterprise

445. Tenovus

446. Tesco

447. Thames Hospicecare

448. Thames Valley Hospice

449. Thanet District Council

450. The Ark Shop

451. The Art Organisation

452. The Charity Shop

453. The Childrens Society

454. The Childrens trust

455. The Crossing

456. The Good Neighbour Project

457. The Greenhouse

458. The Harrow Club

459. The Hinge Centre Ltd

460. The Isabella Community Centre

461. The Island Partnership

462. The Kiln Cafe

463. The learning community

464. The Linskill Centre

465. The Listening Company

466. The Octagon Centre Hull

467. The Old Manor House Riding Stables

468. The Princess Alice Hospice

469. The Range

470. The Reuse Centre

471. The Rising Sun Art Centre

472. The Rock Foundation Ice House

473. The Shores Centre

474. The Spurriergate Centre

475. The Undercliffe cemetary charity

476. The Vine Project

477. The Welcoming Project

478. The Woodworks (Genesis Trust)

479. Think 3E,

480. Thirsk Clock

481. Thurrock Council

482. Thurrock Reuse Partnership (TRUP)

483. TLC

484. TooGoodtoWaste

485. Top Draw

486. Traid

487. Trinity Furniture Store

488. Troed Y Rhiw Day Project

489. True Volunteer Foundation

490. Tukes

491. Twice as Nice Furniture Project

492. Twirls and Curls

493. Ty Hafan

494. Tylorstown Communities First

495. United Churches Healing Ministry

496. United Play Day Centre

497. Unity in the Community

498. UNMAH

499. Untapped Resource

500. Urban Recycling

501. Vale of Aylesbury Vineyard Church Project

502. Vista Blind

503. Walpole Water Gardens

504. Walsall Hospice

505. Wandsworth Oasis trading Company Limited

506. Wat Tyler Centre

507. WEC

508. Weldmar

509. Well Cafe

510. Wellgate Community Farm

511. Wellingborough District Hindu Centre

512. Western Mill Cemetary

513. WH Smith

514. Wheelbase

515. Whitby Council

516. Wildlife Trust

517. Wilkinsons

518. Willen Care Furniture Shop

519. Willington Community Resource Centre

520. Windhill Furniture Store Shipley

521. Woking Community Furniture Project

522. Womens Aid

523. Womens Centre

524. Woodlands Camp

525. Worsbrough Mill & County Park

526. Xgames

527. YMCA

528. York Archaeological Trust

529. York Bike Rescue

530. York Carers centre

531. Yorkshire Trust

532. Yozz Yard

533. Zest

534. Zues Gym

 

The Tory government has been forced to reveal a vast list of firms that hoovered up free labour from benefit claimants after spending four years trying to keep it a secret.

Poundstretcher, Tesco, Asda and Morrisons are among more than 500 companies, charities and councils named as having used Mandatory Work Activity.

Others on the list from 2011 included payday loans firm Cash Converters, chicken diner Nando’s, WH Smith, Superdrug and DHL.

More than 100,000 jobseekers were put on the hated ‘workfare’ scheme, which forced them to work 30-hour weeks unpaid for a month each or have their benefits docked.

Yet the Department for Work and Pensions (DWP) mounted an astonishing and costly legal battle to keep the firms’ names a secret.

Officials claimed revealing those involved would hurt their “commercial interests” because protesters would boycott them.

The DWP stood its ground for nearly four years despite being overruled by the Information Commissioner (ICO) watchdog in August 2012.

The saga finally ended at the Court of Appeal on Wednesday – where a trio of top judges threw out the DWP’s argument by a 2-1 vote.

Campaigners and Labour condemned the vast cost of the cover-up – in which taxpayers had to fund lawyers for both the DWP and ICO.

 

 

 

Only Greece (out of developed nations) has seen a wage collapse as dramatic as the UK

While most of the rest of Europe have experienced some wage growth since 2007, including crisis devastated economies like Spain (+2.8%) Ireland (+1.6%) and Italy (+0.9%), UK workers have seen a catastrophic decline in earning power only matched by workers in the economic catastrophe zone that is Greece (-10.4%).

Ordinary British workers have seen the deliberate decimation of their wages since the Lib-Dems enabled the Tories back into power in 2010. Meanwhile the super wealthy minority have literally doubled their wealth since the economic crisis. 

Aside from overseeing the longest sustained decline in wages in economic history, a reduction in earning power only matched by the crisis stricken Greek economy, a huge upwards redistribution of wealth, and the slowest economic recovery on record, the Tories have also been savagely attacking working rights too.

Just look at the furious way the French have reacted to attacks on their employment rights with continued riots (mostly unreported by UK MSM), and consider that they’ve enjoyed a 10% increase in their earning power since the pre-crisis period.

In Britain we’ve had a 10.4% decrease in our earning power and most people have sat back compliantly as the Tories have repeatedly snatched our employment rights away.

What will it take for the Sheeple of the UK to wake up from their torpor?

 


Credit to the TUC report below: http://touchstoneblog.org.uk/2016/07/uk-real-wages-decline-10-severe-oecd-equal-greece/

UK real wages decline of over 10% is the most severe in the OECD (equal to Greece)

27 Jul 2016, by  in Economics

The decline in UK real wages since the pre-crisis peak is the most severe in the OECD, equal only to Greece. Both countries saw declines of 10.4% per cent between 2007 Q4 and 2015Q4. Apart from Portugal, all other OECD countries saw real wage increases, albeit mostly modest ones.

oecd_w_jul16

(NB strictly the Greek decline is 10.41% and the UK 10.37%, but no way are the figures accurate beyond one decimal place.)

These results are derived from figures in the 2016 edition of the OECD’s Employment Outlook (released a couple of weeks ago, but it has taken me some time to get hold of the figures – see endnote for details of calculation). Even though most countries have seen real wages rise, growth rates are generally disappointing – under normal condition you might expect around 2% a year, and so 16% over eight years.

At the time their UK release contrasted a strong employment performance with weak earnings growth. The employment rate is at a record level, some 5 percentage points above the OECD average. On the other hand real wages “fell by more than 10% after 2007”. See the left and rightmost charts below:

oecd_report_jul16

The comparison of figures for individual countries therefore gives a fuller context for the wage decline shown on the OECD chart. To be balanced, the same should be done for employment – the OECD also provides figures for the ‘employment gap’ – defined at the top of the next chart:

oecd_e_jul16

(The figures are extracted from chart 1.2 in the Employment Outlook.)

The government’s argument is that flexibility on wages has permitted the employment gains. Whatever your view of the theory, the data show this is not obviously the case. In spite of the largest falls in wages, the UK ranks sixteenth (of 42) in terms of job gains (though the employment chart includes some non-OECD countries that have performed well). Any flexibility in Greece was completely pointless. Moreover the countries with the highest gains in real wages were also among those with the highest employment gains.

Plainly the relationship between wages and employment is not as straightforward as notions of flexibility might suggest. The following chart compares outcomes on employment with those on wages (the underlying data by country is in the annex).

The UK is very much an outlier – the only country where a good jobs performance is associated with a bad (terrible) real wages performance.

Employment v earnings, change over 2007Q4 to 2015Q4

oecd_scatter_jul16

Thankfully the UK is not Greece or Portugal in the bottom left quadrant. Taking the low wage road may have helped to keep jobs afloat in the UK; in contrast, in the majority of countries (in this sample) the employment gap was still negative but wages rose (bottom right quadrant). It is possible to think that economies/policymakers face a choice between these two options.  But this would be wrong – other countries have managed to have it both ways (top right quadrant).

These are mainly central European countries: Austria, Czech Republic, Estonia, Germany, Hungary, Lithuania, Poland, Slovakia and Switzerland along with Japan and Israel. All these countries have benefited from strong aggregate demand in recent years, in particular through exports and/or government spending.

Plainly this is not a decisive measure of performance, if such a thing exists. My sense is that outcomes in the post-crisis period should be assessed alongside a comparison of performance relative to the pre-crisis period (see for example my examination of the effect of spending cuts cross the OECD – here). On this basis of the countries above, those ‘A8’ countries (that joined the EU from 2004) may have performed strongly over the post-crisis period, but have seen a significant reduction since the pre-crisis days.

Nonetheless the above results offer a valuable perspective on labour market outcomes overall.

We knew already that the UK had endured the longest and steepest decline in real wages since at least 1830. We now know that this decline is matched by no other country apart from Greece. Gains in employment are not adequate compensation.

Endnote: the total wage decline is derived from Figure 1.6, by compounding the separate growth rates for 07Q4-09Q1, 09Q1-12Q4 and 12Q4-15Q4. Note that the OECD derive real wages from national accounts information, dividing total wages by hours worked and putting into real terms with the household consumption deflator. These can differ from those based on average weekly earnings and CPI inflation that tend to be used in the UK.

ANNEX: change over 2007Q4 to 2015Q4

oecd_tabler_jul16

 

Frankie Boyle has just won politics, you won’t read a better analysis of the current state of UK politics, and some of these metaphors are the funniest thing I’ve read in ages!

MAD TING. SAD TING.


“Theresa May claims to want compassionate Conservatism, and for the party to be greener. So fingers crossed her next ‘go home immigrants’ poster vans are all going to be hybrids. It’s great for girls to see a female leader, say people who live under the longest reigning female monarch and an equal pay structure worse than Namibia.

May is currently meeting a few world leaders so that they can get to know the real woman behind their citizens’ cavity searches and illegal detentions. It does feel a bit awkward turning up in France right now wanting to talk about Brexit, like we’re a neighbour rocking up at a funeral asking if we can have our Tupperware back.

Angela Merkel was quick to pay her respects. May is very popular in Germany where she’s a character from a childhood cautionary tale about not cutting your nails.

Of course it’s lazy sexism to compare May to Merkel, Thatcher, or to any female leader. We should instead compare her to people with similar qualities, like Judge Dredd or a sort of crocodile man that once ate me in a nightmare. Any idea that she was going to show a gentler side in her new role disappeared when she stood up in Parliament, looking like she’s solely made from the bones they left out of Boris Johnson, and announced that she’s prepared to push the nuclear button with the suppressed grin of a serial killer on a conjugal visit.

The Tories are currently brain-storming how to cherry pick the absolute worst parts of EU membership while jettisoning all that stuff about human rights and environmental standards.

For the left-wing Brexit voter,this is going to be like sending your Christmas list up the chimney and finding the only wish you’re granted is the wheezing old stranger watching you sleep.

And let’s pause for a moment to imagine how badly Johnson, Davis and Fox are going to play with Europe’s technocratic negotiators. Soon a UK citizen’s best chance of getting an EU passport will be showing Islamic State’s forgery department a full HGV license.

I was sure we’d never need Trident to stop other states from attacking us. But then Boris was made Foreign Secretary and I thought, ‘could be time for a rethink’. One thing we can be sure of, his translator’s going to be getting a fair few smacks in the mouth. It’s easy to underestimate his achievements, without Boris I doubt there’d be that ‘do not consume while pregnant’ warning on bottles of Pimm’s.

He’s undeniably a product of the public school system, the sort of kid whose parents’ evenings consisted of apologetic appearances by the butler. And it might be just as well: if he’d gone to a comprehensive he’d have been wedgied clean in two.

Meanwhile, the Parliamentary Labour Party is trying to replace Jeremy Corbyn after ten months, showing all the patience of Prince waiting for his paracetamol to kick in.

We’re told Corbyn is useless, then he manages to put together a more competent cabinet out of his billiards partner, an ex-girlfriend, mirrors, and some masking tape than May did with the entire back catalogue of fee-paying education’s finest.

It’s weird to see the media cast him as a bully, and it might just be a simple case of projection. At the moment he’s re-enacting a Spanish bullfight. He’s a beige bull staggering around an allotment with a couple of dozen swords sticking out of him, heroically whispering, ‘Who wants a courgette, I’ve got a glut’.

Corbyn hasn’t formed a strong opposition, say a parliamentary party who voted for renewing Trident, bombing Syria, and cutting benefits. Really what Labour MPs are selling is a sort of nihilism. They have grown up in a party where their core vote had no option but to vote for them, and where until recently members had little power. So they’re going to go into a leadership election asking their members to, essentially, abandon hope.

The only time most Labour MP’s are going to try and inspire the working class these days is if they need a new kitchen fitted for a short-notice dinner party.You have to wonder how they’d fare under the same media scrutiny as Corbyn, particularly after a week where the Syrian bombing they voted to get involved in killed 85 civilians and one of the rebel groups it was supposed to support beheaded a child.

In a way Labour are the only party reflecting the mood of the country, by loathing each other. Angela Eagle withdrew from the leadership race. There was nothing about her that suggested leadership – she looks like she’d shriek every time Putin entered a room and has the voice of a Collie locked in a hot car. Owen Smith was head of policy for Pfizer, but despite his best efforts there still aren’t enough drugs in the world to make his election seem like a good idea. Smith looks like his most radical policy will be not wearing a tie to the park.

There are a lot of people in Britain who need radical ideas, because the status quo for them is simply not survivable.

Even with the full weight of the media behind them, it’s going to be very difficult for Labour to persuade such people that things can go on as they are, that there’s a non-radical solution.

Theresa May might find she has a similar problem managing the expectations of those who voted for Brexit. What we can be sure of is that all this is going to demand a lot of distraction and scapegoating, and personally speaking I can’t wait to see which religion, race, class, country, gender, sexuality, human right or raft of drowning children our political class decides to blame next.”


Just brilliant!

The Five Rules Of Propaganda as laid out by Edward Bernays, godfather of PR, nephew of Freud.

The Five basic rules of propaganda, once you’ve read, absorbed and understood these five points, you will almost certainly see all these techniques within minutes of turning on the TV news or picking up a newspaper.

1:The rule of simplification:

reducing all data to a simple confrontation between ‘Good and Bad’, ‘Friend and Foe’ (or even ‘Right and Wrong’).

2:The rule of disfiguration:

discrediting the opposition by crude smears and parodies.

3:The rule of transfusion:

manipulating the consensus values of the target audience for one’s own ends.

4:The rule of unanimity:

presenting one’s viewpoint as if it were the unanimous opinion of all right-thinking people: draining the doubting individual into agreement by the appeal of star-performers, by social pressure, and by ‘psychological contagion’.

5:The rule of orchestration:

endlessly repeating the same messages in different variations and combinations.


Thirty one minutes of outstanding lecture on the history of propaganda and it’s relevance to Obama and the Empire of the USA.

John Pilger – Obama & Empire

https://t.co/PGHxb4ggme
Bernays, Disinformation, PR & Propaganda speech 2013. WHAM – Winning Hearts And Minds
(https://www.youtube.com/watch?v=GAmtNIC8zv0)