And its the most godawful mess, too:
Take banking, since this week the big high street names report their results. With each disclosure of rebounding profits will come an admission that the banks are putting aside millions more to compensate businesses and households they’ve ripped off through mis-selling. And each time, Chuka Umunna or Chris Leslie will swear that Labour would bring in “challenger banks”, while the coalition will retort that “there is already greater choice on the high street” than there was under Tony Blair.
But what is the point of having more competitors if they’re all doing the same thing? Go online and look for a savings account: there are tons around – most with time-limited offers, or with fiddly rules about how much you must pay in each month. Lots of versions of the same, basic product: the providers simply competing to bamboozle customers. All hail the market!
For Labour to say that more competition will fix predatory industries is to mouth economic theory while ignoring business practice. For Ed Miliband to claim market forces alloyed with some cliches about living wages and an industrial policy will get Britain out of its deep hole is to see the country through Westminster abstraction over real-world specifics.
Britain’s model of capitalism was clearly not working long before 2008. Once you strip out inflation, the typical worker saw no wage rise for most of the past decade. So who prospered during the boomiest boom in economic history? Those at the top, often running or owning businesses well-sheltered from competition (think: water, rail, energy) and shaking them down for bonuses and dividends.
Such rampant market inequality won’t be solved by competition.
I’ve not cut nor edited anything there. He really is stating that the worst abuses came in those markets with little competition and also that competition doesn’t solve or cure market abuses.
Blimey, with this sort of logic you can describe an historian as a valid and useful commentator on the economy.