The Archbishop is Right

We are being committed to radical, long-term policies for which no one voted” (The Archbishop of Canterbury Rowan Williams).

He is right. The government is implementing policies for which no one voted, or would vote for. No one voted to cut care services for the old and the disabled. No one voted to close hospital departments or to delay repairing schools or to close libraries and sports facilities or to reduce rubbish collection. Yet this is all happening as a result of what the government is doing.

It’s what governments always do when capitalism goes into one of its periodic crises. If nothing else this shows that capitalism is not a system geared to improving people’s lives. If it was, this sort of thing would never happen. As productivity went up (as it does slowly but surely each year) then society would be able to produce more and so be more able to provide better care for the elderly and better amenities for everyone.

That is what the increasing surplus of wealth over and above meeting basic needs would be used for. Under capitalism, however, it takes the form of profits, and competition between profit-seeking enterprises forces most of these to be reinvested in production rather than in improving people’s lives. Any government that tried to do this by diverting profits from capital accumulation would soon find itself in economic difficulties. Governments that have tried have been forced by capitalist economic reality to do a U-turn and give priority to “growth” as they call capital accumulation. But this growth is not a steady process but a series of fits and starts, of periods of booms ending in a crisis and a slump when amenities and living standards have to be cut as a way of creating the conditions for capital accumulation to resume.

Which is where we are now. People getting what they didn’t vote for also shows that capitalism is incompatible with democracy as an expression of “the people’s will”. This is not because there are no procedures in place for people to decide what they want, but because the way the capitalist economy works prevents some of these decisions being implemented. Capitalism is not geared to doing what people want. People want the problems they face to be solved but capitalism simply can’t do this. And no amount of making the decision-making process more formally democratic can alter this because that’s not where the problem lies. It’s that capitalism is a system geared to making profits and accumulating capital irrespective of people’s decisions and needs.

This is not happening just in Britain. In some other countries it’s even more blatant. In Iceland a law was passed during the financial bubble guaranteeing the savings of depositors, whether from Iceland or abroad, in Icelandic banks in the case of a bank failing. No one expected that banks would fail but they did. The Icelandic government didn’t have the money to hand to honour this promise so the British and Dutch governments stepped in and sent the bill to Iceland. The government there told these creditors that it would find the money by drastically worsening the life of the people in Iceland. And did so. The people of Iceland have voted twice in referendums to reject the terms of the deals. To no effect. In the end the Icelandic government will have to pay up and cannot reverse its austerity programme.

It’s the same in Ireland where the government had given a guarantee to underwrite bank losses. Fintan O’Toole made a valid point in the Irish Times (3 May) when he criticised the twisted logic used to justify making things worse for people there:

“The basic proposition is that ‘the Irish’ borrowed loads of money and ‘the Irish’ must pay it back. Each and every citizen of a particular nationality is responsible for the misdeeds of others who hold the same nationality. National identity trumps everything else. It doesn’t matter that you didn’t borrow the money or that you had no way of knowing what decisions private banks were making. You’re Irish, the banks are Irish, so you’re all guilty. (…) so the nurse in Ennis and the factory worker in Portlaoise have to pay it back.”

The Irish government will have to honour its guarantee, and nurses and factory workers and others will have to suffer. The Irish voted to kick out the previous government but that hasn’t made any difference. The new government will have to continue doing the same, as will the new government in Portugal and as the old government in Greece has been doing. It’s what managing capitalism – whichever party or coalition of parties is in office – involves at the moment, what the Archbishop (who seems to be rather perspicacious) described in his article in the New Statesman (9 June) as “managerial politics, attempting with shrinking success to negotiate life in the shadow of big finance”. He described this as “not an attractive rallying point”, but that’s all that’s on offer and can be on offer.

In other places it’s yet worse still. The government of the Maldives in the Indian Ocean decided recently to float its currency against the dollar as “essential to cut the country’s ballooning budget deficit and stabilise the economy” (Times, 6 May). As a result “almost overnight, the price of staples such as rice and bread soared by 30 per cent”. Hence the news item’s headline: “Violence in the holiday island intensifies as food prices soar.” The opposition party there is trying to use the unrest to get back into office but even if they succeed they would still have to attempt to negotiate life in the shadow of capitalism. This is all governments everywhere can do.

People don’t take this lying down and, rightly, try to resist their lives being made worse. But if government action cannot overcome the iron laws of capitalism, neither can strikes, street demonstrations or riots. The most these can do is slow down the worsening a little but not reverse it. The cruel fact is that within the context of capitalism, as Mrs Thatcher said to the archbishop, there is no alternative. That’s the case for socialism.


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