If you\’re old enough to remember the Thatcher years, you may have an answer to this question, but it\’s still worth asking: in living memory, have thousands of us on the left ever felt so bleak? Every day, I seem to have at least one conversation that ends with sighing expressions of fatalism about where Britain is headed, and how disorganised any opposition seems to be. Cameron is supposedly triumphant, and it certainly feels like it: even if the Tories failed to win the last election and now see some of their most treasured plans tumbling into disrepute, it\’s the right that is setting the terms of the argument.
Across Europe, the crisis of social democracy continues apace: now Portugal is added to the list of countries where the key effect of a supposed crisis of capitalism has been a thumping defeat for the centre-left. And what have we got even to keep us warm?
There really is a very simple retort to this sort of moaning.
If you\’re going to have anything like a capitalist (or even market based) socio -economic system then better to have it run by those who understand capitalism/markets.
If you don\’t want that sort of societal structure then great, vote for the socialists, the Galloways, Richard Seymour and the varied groupuscules of the gallopingly insane. Watch as society descends into a welter of blood spattering, as it did everywhere else anyone did this.
If you do though, if you like the wealth that that capitalism/markets mixture produces, that ever onwards surge of technological innovation, then the one group of people you don\’t want running it are the British left. Because they don\’t understand it: and by left I don\’t mean just those idiots reading Socialist Worker or the Morning Star. This ignorance extends well into the leftier parts of the Tory party and certainly includes the likes of Polly etc.
For they look at societies they admire, desire the UK to be more like, and fail to understand what makes them work. Places like Denmark and Sweden, for all their high tax rates and redistribution, for all that lovely subsidised child care, are more capitalist, more market based, than the UK is.
Take, for example, taxes. The classical economics of taxation tells us that for whatever amount of money we raise, we\’ll get more economic growth by taxing property and consumption more highly and capital and corporations more lightly. This is about the tax mix, not the level of taxation.
So, what does Sweden do for example? They have a high VAT (25%) with very few lower or zero rated items (Denmark is also at 25% and they\’ve even fewer let outs), low corporation tax, low capital taxation and no inheritance tax at all. Nor a national minimum wage even.
Now if you said to your average Brit leftie that that\’s how you run a social democracy they\’d look at you as if you\’re mad. No! VAT is regressive! Well, yes, it is, but it\’s still one of the best ways to collect tax money without destroying future growth. Low corporation tax? But the bastard companies must pay! But companies don\’t pay, ever, they\’re just a convenient place to collect the burden that falls upon others. A burden that, the more open the economy, falls more upon the workers.
And so on and whatever und so weiter is in Viking.
In my saner moments I realise that the British left isn\’t in fact evil. Desiring free child care isn\’t even immoral. But they are entirely ignorant: for they have failed to understand what it is that makes the places they admire actually work.
In order to have all of those lovely state services you\’ve got to raise the money to pay for them. Something you want to do in a manner which doesn\’t crucify the productive economy underneath. Which means that you\’ve got to run the economy along even more classically liberal lines, not less.
In order to be able to afford to heal the wounds of capitalism red in tooth and claw, cuddle them with those wondrous services, you\’ve got to have a capitalism even more red in tooth and claw underneath to pay for them.
Until the British left understand this pretty basic point they will continue to be incompetent at running a capitalist/market based society. Because without understanding it they will never be able to find enough money to get all thet prety shinies they see and desire but have no friggin\’ idea how to pay for.