Earlier in the week, I posted an overview of my talk at this year’s Parnell Summer School, where the theme is Sovereignty & Society, in recognition of the 100th anniversary of the Home Rule Bill. I mentioned towards the end that following my address, there was a panel discussion on Ireland’s economic sovereignty, involving Richard Boyd Barrett (the People Before Profit TD), Paul Murphy (the Socialist Party MEP), Brendan Butler (of IBEC) and Pascal Donoghue (of Fine Gael).
The discussion was in reality four rather separate speeches, each of about 25 minutes in length, followed by audience Q&A. Given their backgrounds, however, the speeches by Boyd Barrett and by Murphy were quite similar in nature. When listening to both, it struck me that – whatever about TV debates, particularly when it comes to elections – there is no sense in trying to engage on particular points. If you disagree, it has to be a disagreement at a fundamental level, the level of the entire narrative. This is not a criticism of either contributor – they are both excellent speakers. In fact, it is a testament to the completeness of their narrative that really means the only fruitful engagement will come from going all the way back to basics.
The Socialist Narrative
I will do my best to sum up the Boyd Barrett-Murphy argument: they believe that the economic crisis that started in 2007 is being used as an opportunity by a global elite in control, who share a common ideology, to embed that ideology permanently and beyond the reach of citizens, i.e. anti-democratically. To them, the global elite’s “neoliberal” ideology is summed up by capitalism, privatisation, deregulation and the market. (By the by, I’ve never understood what was precisely so ominous about being a latter day liberal, other than the tone in which it is used by those who have set themselves against neo-liberals!)
According to the narrative, this elite that is in commanding control is pro-market, pro-1% (i.e. themselves presumably) and anti-worker, hence they are trying to reduce minimum work standards and similar, and impose austerity so that the “ordinary man” pays the cost of them enjoying greater wealth. In that context, the EU’s new fiscal “six-pack” is interpreted easily – as a way for the elite to put their ideology irreversibly beyond democratic control.
Paul Murphy, who spoke second of the two, explain in more detail that the root problem is profit. When the profit motive is king, it tramples on people, according to him – why else would EU companies be sitting on €3,000 billion of cash reserves while there are tens of millions unemployed across the EU?
A complete story is not necessarily a true one…
Listening to both men speak, they are compelling public speakers and likely to tap into public anger. They are likely in the next election to have success with those who believe that it is banks, not deficits, that are the bulk of what’s wrong with Ireland’s problems right now. If you try and tackle one point that they make, their answer will most likely be something that is entirely consistent within their narrative – and leaves the questioner having to go one step further back.
Ultimately, the 21st century’s socialists view of the world, if Boyd-Barrett and Murphy are representative, comes down to control. Socialist or not, we all have to answer the question: why are there so many things wrong in the world right now? From first-world problems like falling birth rates, pension shortfalls and youth unemployment to more pernicious issues ravaging developing countries, the world is not as any of us would like – and any account of the world has to incorporate the economic crisis of the last five years. And it comes down to whether you believe in incompetence or malevolence.
Evil? Or just incompetent?
The root difference between my world-view and and the socialist one is that they believe the world is like it is by design – malevolent forces (the “global neoliberal elite”, the 1%) have crafted a world exactly as they would like it. To me – and I think to very many others – the world is like it is due to the incompetence of those in charge, not because this is their masterplan. Socialists seem furious that the economics of Keynes gave way to the economics of Friedman, oblivious to the fact that the dominant model in economics, the one that has dictated the rules for monetary and fiscal policy for the few decades, is New Keynesian! Keynes believed that output could be controlled by policymakers to dampen business cycles – and mainstream economics has clung dearly to that belief, refining it so that it is the interest rate that is used to do this.
If we step back for a minute, if there is a global elite working against our interests in confident control of the world economy, why is it the case that the typical person is so much better off now than fifty years ago (looking at figures such as inflation-adjusted mean and median incomes)? Why is labour’s share of income so high if capital is in control? Why is the standard of living in the 2010s going to be better than any decade that has gone previously? More fundamentally, why are they allowing democracy to spread? Why are they allowing people’s education levels to get higher and higher? After all, surely, at some point if we keep getting more educated, we’ll eventually cotton on to their plan? And why do they allow mobility between “us” and “them”?
This is not to say for a minute that there are no issues to sort out. But even in those issues, the narrative starts to crumble. Why are so many genuine capitalists (i.e. those who earn money through capital, rather than labour) and “right-wingers” so vehemently against bank bailouts? Well, presumably because a system where some people cannot lose no matter what (bank bondholders, say) is a subversion of an economy built on risk-taking. Risk means the potential to lose.
Politics and academia also don’t sit easily with the narrative. In the US, for example, the typical lower income household has seen their real income at best static over the last generation and even longer. But in terms of economic policy, this is one of the hottest issues on the campaign trail – if the US elite were truly in control of everything, this is the last thing they would want! In terms of economic theory, static incomes of lower-income households is one of the most active areas of research (at least in the US) – the two candidates for causing this are trade and technology, not – I guess it should be pointed out – a global elite in control of our lives.
Follow the trillions…
For me, the point about three trillion in the bank neatly encapsulates the shortcomings of the 21st-century socialist world-view. When making that point, there is the implicit assumption that if lots of money is left in the bank, it does nothing – a shockingly poor level of understanding of fractional reserve banking! One man’s savings is another’s borrowings. Moreover, there is the explicit accusation that these multinationals are leaving money in the bank instead of hiring unemployed people. As if business people would rather sit on what are assumed to be useless piles of cash than make more money by investing it.
The currency of the world is confidence. It dictates the value of money, the value of wealth, even the business cycle. It is not something that can be managed – either by benign policymakers or malevolent elites. If some businesses are “sitting on hoards of cash”, it is because they are nervous about the future. But at least they are depositing that cash with banks, who can then lend it out to other businesses. If those banks are “sitting on hoards of cash”, it is because they are nervous about the future.
Ultimately, no-one is in control. I’m not sure if that makes the world a scarier place than one in which at least someone, albeit a malevolent elite, is in control. But it’s a reality we need to accept if we are react as best we can to what’s going on around us.
Undoubtedly, any socialist worth their salt will have answers to some or all of these points that restore the cohesive whole of their narrative. I would like to point out that I posted the above at least for myself as for anyone else, as I wanted to crystallize – so soon after hearing the guts of an hour of modern socialist thinking – that world-view and my thoughts on it. As always, I mean to engage (and certainly not caricature or mock). I am currently reading Michael Sandel’s “What Money Can’t Buy – The Moral Limits of Markets” as a way to delve more fully into this topic. When I’m finished the book, I will post a review on the blog. It’s early days in the book and I would already love to write my own book in reply!