potlatch

capitalism as a policy problem

The current British policy and media vogue for debating 'capitalism' may well be unprecedented. There have long been rolling public debates about specific institutions and practices, such as banks, markets, debt, financial markets and trade. But to focus on capitalism implies a more political-economic perspective, which is alert to questions of hierachy, ownership, power and institutional evolution. At least it should do. Historically, the question of 'capitalism' has been more often debated by its critics (from Marx onwards), or else by those such as Milton Friedman who have used it to attack socialism. Even then, neoliberals have preferred to refer to 'markets', 'enterprise' and 'entrepreneurship' when providing the gloss to their economic argument.

The new debate is to be welcomed, but it is inevitably throwing up misunderstandings and strange representations. The Financial Times has been running a sophisticated series of op-eds on the crisis of capitalism, which only really hit the intellectual rocks with a piece published yesterday, entitled 'It's a crisis of confidence, not of capitalism' (the stupidity of the article's headline turned out to be well-matched to the identity of its author, the Chancellor of the Exchequer).

The first thing to note, as if it needed saying, is that of course capitalism is in crisis. The denial of this fact seems to go hand in hand with two intellectual errors. Firstly, it misunderstands the meaning of the word 'crisis', which it hears as equivalent to 'end' or 'death'. Nobody has yet plausibly suggested that capitalism is coming to an end. But quite clearly there is a crisis, in the literal sense of a judgement, turning point or critique. Capitalism is in a critical condition, which will determine what sort of future it has. This is what 'crisis' refers to. For evidence that it is in crisis, one need only point to the fact that policies which once alleviated its shortcomings, now appear only to exacerbate them. To his credit, Gordon Brown appears in this piece to grasp the historic importance of the current period that we're living through, and the vast scale of any potentially adequate political response.

Second, the crisis deniers get lost in is/ought distinctions. They seem to believe that announcing a 'crisis of capitalism' means advocating socialism. They then very swiftly fall into making abstract and irrelevant moral-psychological claims about how competition and self-interest are 'still' the only plausible bases for organising the economy. Take this Newsnight debate from last week for example. The inevitability of capitalism, in roughly its current form, is asserted on the back of a philosophical anthropology, which is derived from... well, the think tanks and ideologues whose job it is to defend the freedom of capital. Typically this freedom is also erroneously dressed up as the freedom of markets, with endless mis-readings (and more likely, non-readings) of Adam Smith to buttress it.

Yet the ideologues are partly responding to the way in which the question of 'capitalism' has been posed by politicians and pundits alike, which is in heavily moralistic terms. Nick Clegg, David Cameron and Ed Miliband are competing to find ways to attack the morally noxious bits of capitalism, and not merely the useless bits, though Miliband's notion of 'predatory capitalism' suggested that the two go hand in hand. I've heard it suggested that politicians' sudden obsession with the 'c' word may be a strategy to avoid talking about immoral 'business', which swiftly invites questions of which businesses in particular, the same questions which floored the entire shadow cabinet after Miliband's conference speech.

It seems that the main reason 'capitalism' has been put on the table as a policy problem is that this distinguishes the problem as a moral one of principles, not a utilitarian one of economics. British politics is suddenly experiencing a classically ordo-liberal moment, in the sense that economic 'right' and 'wrong' no longer map cleanly on to 'efficient' and 'inefficient'. This partly explains why the collapse of economic growth is having so little impact on the Conservative Party's poll-ratings: for the time being, debates have shifted on to liberal questions of form and structure, away from utilitarian questions of output. Other bizarrely non-utilitarian behaviours abound, such as governments and firms seeking to pay off debt at a time of negative real interest rates, producing a 'balance sheet recession'.

To this, some nuance could be added, by recognising that all capitalist crises are also moral crises, but in a very particular sense. From the 18th century onwards, liberalism has functioned on the basis of an illusory split (famously criticised by in Polanyi's Great Transformation) between the amoral realm of the 'economic' and the moral realm of the 'social', also represented as a dichotomy between the sphere of value and the sphere of values. This illusion is propped up by an associated split between economics (the study of rational choice) and sociology (the study of association and rules).

Ultimately this split is a useful fabrication or fantasy that serves policy-making, rather than one emanating from institutions or agents themselves. 'Economic' institutions (such as banks) are awash with moral judgements, rituals and norms; 'social' institutions (such as families) are equally awash with rational and monetary calculation. But the split does some work, in preventing us from subjecting everything to constant moral judgement, which would be hugely time-consuming and inefficient. Neoliberalism has frequently committed the opposite error of seeking to subject everything to rationalist audit, which turns out to be equally time-consuming and inefficient, though when the target is lefty professions and academics, that may be its underlying purpose.

Every stable era of capitalist development rests on its own distinctive way of separating economics from moral judgement (or 'efficiency' from 'equity', as welfare economists like to put it). The critique of capitalism involves challenging this split (for example, through arguing that labour markets are unjust regardless of their efficiency, or that GDP measures bad things) but these critics can typically be rebuffed for decades at a time. However, a crisis of capitalism, like the one we're living through, brings about a collapse in the liberal divide, from both sides at once, as it becomes unclear what is worth measuring and valuing in the first place. Once economics and economic institutions cease to work in a utilitarian sense, their supposed insulation from sociology, moral judgement and political economy fails too.

This is why crises are so exciting and frightening at the same time. They involve a fundamental uncertainty as to what is going on, how long it will take and what types of technologies, institutions and policies will bring it to an end. As I argued in this New Statesman piece, one feature of our current predicament is that we don't yet know what we've come to the end of precisely. A new fluidity opens up, between moral problems of values and economic ones of value, and we confront the strange truth that the entire realm of 'the economy' as a separate thing is really a fiction. This uncomfortable realism only be suppressed again once a new settlement is established, in which a new form of socio-economic division is established, which is both economically effective and morally acceptable.

If current questions of 'responsible' and 'popular' capitalism are to be posed seriously, then we need to be clear about how far moral critique can (and must) currently penetrate. During times of stability, businesses and politicians raise moral questions of values, almost as matters of consumer preference.* This is the function of corporate social responsibility, which is a form of self-regulation at best, and green-washing at worst. During times of crisis, things are far more profound. It is no long a question of what moral values are to be added to utilitarian economic structures, but what moral values are to constitute a future definition of economic value.

This is what I was trying to communicate in my recent paper on employee ownership. In arguing that 'wellbeing' and 'patience' must be central business 'values' of any post-crisis capitalism, I was not intending that these are somehow nice things, which we really ought to think about a bit more. More fundamentally, the fact that the previous model had failed to account adequately for human psychology on the one hand, and for long-term outcomes on the other, was actually at the heart of how and why the crisis occurred. It follows that any resolution of the crisis will necessarily rest on a new notion of economic value, which somehow factors in these moral values.

If the new public debates about capitalism are to be more than rhetorical, they will need to move beyond obviously moral issues, such as inequality and who 'deserves' what. The term 'fairness', like 'equity', keeps morality safely confined to certain classically moral issues, from where it is unlikely to interfere in the distribution of political power (as I argued in this openDemocracy piece. I was delighted to discover amongst The Browser's quotations yesterday Scott Adams' "fairness is a concept so dumb people could participate in arguments"). Instead, it needs to take on economic institutions of ownership, governance, democracy, valuation, audit and performance measurement. There are some encouraging signs that this might be beginning to happen.

 

* I once worked at a research consultancy which was in the process of re-branding itself, and wanted to engage its staff in identifying its core 'values'. This resulted in a hilarious, Python-esque all-staff meeting in which one individual would opine "I think 'trust' should be one of them", which would then be met with a response from elsewhere "'trust' is rubbish! 'Integrity' is far better!", which in turn would be shot down by "nonsense! 'Leadership' is clearly the best". And so on, depressingly confirming Milton Friedman's famous dictum that "over values, men can only fight".

new issue of The Point

A quick plug for a newish journal, The Point, established by three graduate students at Chicago. Their latest print edition has a symposium of essays on the topic 'What is the Left for?', with contributions from me (plug plug) and Erik Olin Wright. Mine challenges the assumption that the Left is anti-market, and the associated assumption that neoliberalism is pro-market (an argument that is also well made in Colin Crouch's new book), and demands instead that we focus upon hierachies within capitalism.

I learnt from the ippr's roundtable commemoration of Marxism Today that the secret of its success lay in relentless, unsparing editorial intervention by its editor Martin Jacques (afflicting every author great and small except Bea Campbell, so it was said). By that standard, great things can be expected from The Point!

Independent article on happiness

I had this article in The Independent magazine on Saturday, offering some explanations for the turn towards happiness, as an object of statistics and government. It mainly summarises things I've written elsewhere in openDemocracy and The New Left Review. The piece concludes:

So much technocratic interest in our minds, brains and selves may sound frightful. In 1816, Samuel Coleridge accused utilitarian philosophers of recognising "no duties which it could not reduce into debtor and creditor accounts on the ledgers of self-love". But the science of happiness may have a more culturally transformative role: as we now know all too well, British living standards are going into reverse, at least for the next five years – and who knows what will happen after that? If GDP growth represents national 'progress', then this nation has stopped moving.

This poses crucial questions about how best to exploit a shrinking supply of income, jobs and public spending – which research on happiness can help answer. The same pound can have very different psychological pay-offs. As [Geoff] Mulgan explains: "The less money there is to go around the more important it is that each pound achieves the greatest possible effect, and some of the policies that would have the biggest impact on happiness won't actually cost much...".

But economic stagnation also poses serious philosophical questions about how else we can imagine our society's direction of travel, once the assumption of economic growth no longer holds. Modern societies need a sense that the future will be better than the past. If capitalism can no longer make such a promise, then forms of non-economic growth might have to. The ONS's figure of '7.4' could be the start of a whole new approach to social and economic change.

new report on employee ownership: All Of Our Business

My new report, All Of Our Business: Why Britain needs more private sector employee ownership, is published today by the Employee Ownership Association. To accompany it, I had an article in The Sunday Telegraph yesterday laying out its main arguments. And today, Nick Clegg seems to be taking this agenda seriously, as part of the (overdue) political movement towards questioning ownership and control in the private sector, and not just the public sector.

The central argument of the report is this:

[The report identifies] two rival philosophies of economic value, that businesses can embody. The first privileges the power of ‘exit’, and rapid turnover of all stakeholders, including shareholders, management and employees. Its proponents argue that this philosophy breeds efficiency, dismantling obstacles to innovation and profit. But in the last four years, it has become mired in a legitimacy crisis, as it appears to lead primarily to the personal enrichment of those who enforce and facilitate this model.

The second philosophy privileges the power of ‘voice’ and institutional memory, such that relationships between owners, managers and employees are sufficiently strong that information can be shared, and difficult economic times can be weathered. This can be difficult to realise in our culture of short-termism and distrust, but the argument made in this paper is that it is substantially easier in situations where the owners are also employees, and the employees are also owners. Employee ownership is a ‘commitment device’, which can save businesses from their own worst tendencies.

The employee-owned sector is not currently large enough to bring about a wholesale change in the character of the British business model, although the mutuals and co-operatives sector at large (which includes building societies, credit unions and consumer co-operatives) can make a significant contribution to alleviating many of the malaises of corporate governance, especially in the financial sector. They are also more numerous and high-performing than many policymakers appear to realise. The point that this report seeks to stress is that it is not only employees who suffer from a model of short-termist, earnings-obsessed business, but also shareholders, entrepreneurs and businesses, whose long-term interests are frequently neglected by the ethos of profit-maximisation. Eventually, society and public services are impacted negatively by business models and business culture that take such a narrow view of human psychology, as has prevailed in the UK over the past thirty years. The spill-over costs of bad workplace relations are now increasingly falling on the NHS. Viewed this way, it’s not clear that dominant notions of ‘efficient’ business practices are really as efficient as all that.

I'll try and blog a bit more about this in the coming days.

Update: British readers can hear Charlie Mayfield, Chair of John Lewis Partnership, and I discussing employee ownership on Radio 5 yesterday evening, at 2:24mins here.

institutions and privilege

Maurice Glasman has raised the question of why the Labour Party is currently so dominated by middle class Oxbridge elites. This piece outlines some worrying evidence of the narrowing of Britain's political classes. I argued in Renewal a few year's back [pdf], that New Labour appeared to have become dominated by not only 'professional politicians' (as Weber feared) but by a new cadre of experts.

Amongst the plethora of explanations for these trends, we should keep sight of one 'constructivist' element: the way in which institutions have been represented and justified by social scientists and policy-makers over the past forty years. I suspect that, due to the impact of rational choice ideas (theories of public choice, social capital, human capital, Law and Economics), policy-makers have come to misunderstand what makes an institution an institution. Philosophically, this involves repeatedly mistaking explicit measurement for tacit purpose.

This has been particularly disastrous for the Left, which has come to the entirely mistaken view that institutions are regressive and conservative, while 'progress' consists in gutting them through constant statistical audit or replacing them with more fluid forms of networks. A particular functionalist view of politics and civil society has sought to test the validity of institutions, by gauging their measured outcome, and ignoring their normative character. In the process, this turns institutions into a game to be played and won by those with the resources to play it best, rather than a ritual with at least the capacity (not always used) to ignore race, gender and class. This is the public and civic equivalent of what has gone on in company boardrooms over the same period, in which one particular measure of output (i.e. return on equity) has come to serve as the purpose of management, with disastrous long-term consequences for business and the economy, especially in the financial sector.

An institution is first and foremost a set of rules, which exists independently of any identifiable rule-giver. As Luc Boltanski argues in On Critique, institutions are "bodiless beings", the sources of rules that can be appealed to when we argue about the right or wrong way to act. Of course institutions have human (and non-human) representatives: uniforms signal the fact that a human being is actually the delegate of a some larger institution. But institutions cannot be reduced to their visible representatives or symbols, without missing what gives them their binding character. Were you to view spitting in a train carriage only in terms of its health risks and costs, then you would be missing an essential element of what makes it wrong.

Yet from Ronald Coase's 1960 paper, The Problem of Social Cost, onwards, that is exactly how particular rationalist strains of social and political science have viewed such actions. They deliberately ignore the normative element of rules, in favour of how they affect incentives and outcomes. Offensive, unfair or even violent activity could potentially be justified from this perspective, if its aggregate outcome were optimal, a measure which includes the pleasure it may give the 'offender'. Institutions - law, firms, voluntary groups, trade unions, professions - come to be judged in terms of inputs and outputs. Anything that goes on in between is dismissed, either as crypto-socialism or metaphysical nonsense.

The idea of 'social capital' that swept the Anglo-American policy world during the late 1990s was a symptom of this, analysing associations in terms of their measurable effects, with no regard for their intrinsic purpose. It was discovered [pdf] that Britain's social capital had fallen since the early 1980s, primarily due to the decline of working class institutions, and decline of trade union membership in particular. But what sort of problem is this? Is it a fundamental rebalancing of power in the economy and civil society? Or simply a decline of one resource, that can be compensated for with the addition of a new resource? It is the latter that predominates in a rational choice worldview.

The purpose of trade unions, by this account, are those effects which can be causally connected to individual trade union membership using econometrics. These may include effects on health, happiness, risk of crime, fear of crime, job prospects and family life. They are by no means negligible, but they necessarily miss the institutional character of the trade union itself, which is that it holds substantive value to its members, predates them and will outlive them. Institutions have an anti-economic quality, which offends 'modernisers' and rational choice theorists. When Blair attacked the 'forces of conservatism', he was preaching the utilitarian gospel of Jeremy Bentham.

Similar misunderstandings now surround university education. A degree becomes reduced to its economic effects, as if it is the function of a university to increase a student's salary by a certain amount. In the process, the intrinsic value and ritual of education gets overlooked, and potentially undermined. Once this normative character gets removed, it follows that education will become a game to be played, and typically won by the wealthy. Only where education's value is viewed as intrinsic do working class children and students get judged with a spirit of fairness, rather than just a rationalist audit to be cynically deconstructed and interpreted by teachers and parents.

In a sense this is about time horizons. The phoney institutionalism that followed from Coase evaluated institutions in terms of their short- or medium-term effects. It disregarded where they had come from or how long they'd been around (see Said Business School's anti-historical slogan, 'educating leaders for 800 years'), and treated their long-term 'effects' as mired in uncertainty. (In this, there are parallels to the way oil was perceived over the twentieth century, as Timothy Mitchell's analysis details.) But it had no way of understanding the value of endurance, other than as a psychological preference on the part of their present members.

Historically speaking, it is scarcely any surprise that working class representation in Westminster is so low, after the decline of trade unions and political parties. And that decline is little surprise, seeing as how trade unions and political parties have been stripped of political autonomy. To recognise as much is not necessarily to oppose the centralising tendencies of Thatcher and Blair or to romanticise social democracy; but real political power, built upon enduring "bodiless bodies", cannot simply be replaced by alternative forms of 'social capital', without serious consequences.

Meritocracy is a paradoxical thing, best pursued obliquely. Efforts to test 'talent' end up being rigged, while stuffy institutional rituals often have the side effect of acting as economic and political ladders. The reason for this is that tests and audits themselves become unwittingly institutionalised - 'rituals of verification' - and unseen, unwritten forms of power and cultural privilege are mobilised in order to ensure that the winners carry on winning. Tests, in contrast to institutions, have no reflexivity or self-knowledge; they are designed to discover the 'truth' about people, but unintentionally develop into rituals in their own right, whereby the middle classes slavishly practice techniques for gaining and holding on to power. Having no concept of what lies outside of the test, beyond the numbers, these anti-institutional institutions collapse into forms of cronyism. By contrast, self-desribed institutions, such as trade unions and universities, have at least the capacity to speak honestly about the immeasurable values that they are upholding and the political agendas they are pursuing, if only because they (unlike the positivists) see values and politics as part of social reality.

None of this is to say that British institutions haven't upheld norms of sexism, racism, snobbery and homophobia over the centuries, nor is it to entirely dismiss the Thatcherite and Blairite desire to shake up the seemingly sleepy British class system. It is simply that unless the ritualistic aspect of social life is acknowledged (which must partly rest in shared and not entirely articulated rules), then any effort to reform traditional elitism will produce something even worse. Unsuccessful modernisation involves tests and measurements, which reduce social reality to its 'effects', and are then played by cynical elites for private gain. Successful modernisation must therefore involve new rituals which mediate between the spoken and the unspoken, the measurable and the immeasurable, judging people on conformity to rules and the spirit of rules, not only on their output.

'political correctness' revisited

We live in the age of 'transparency' or what I once heard Michael Power describe as 'the age of permanent audit'. This is thanks to the presence, sometimes ubiquity, of technologies which make audit the default option, and inaudit (or privacy) a form of specified opt-out. For celebrities, these include legal and quasi-legal forms of media surveillance; for the powerful, it means the constant threat of leaks, the publication of money-grabbing memoirs and Freedom of Information Requests; for the rest of us, it means facebook and digital cameras.

Under these conditions, words, actions and decisions have a nasty habit of catching up on one. Interestingly, we've largely forgotten about the intrusion of the Big Brother state (for the time being), and discovered that the public sphere can be a far more brutal and effective mechanism for surveillance than the all-seeing, expert panopticon. This is partly thanks to the on-going furore around 'hackgate' in the UK, but also because of a strange new form of political correctness that appears to be emerging, as the public etiquette of the twitter age.

As Chris Dillow argues, a number of recent events suggest that the British have become incredibly over-sensitive recently. Despite having been one of the marchers that Jeremy Clarkson said he would like to shoot (in front of my family) in November, I was depressed by the scale of reaction against a man who (as Stuart Lee points out) is paid specifically to recite predictable rightwing slogans in public. The saga over Luis Suarez's finger - which hilariously now gets reported with the offensive gesture concealed - suggests that we're reviving an Edwardian sensibility. This at a time when no Guardian or Observer op-ed is complete, without an anonymous cabinet minister being quoted that someone or other is "completely fucked" (serving only to demonstrate the intimacy of quoter with quoted).

Levels of rudeness, obscenity and pornography are becoming normalised everywhere, while the stakes surrounding a stray finger or badly-judged joke are also rising rapidly. It's hard not to feel sorry for the BBC and Channel 4, who have to muster unprecedented levels of confidence (that are impossible to defend, if challenged persistently enough by enough people) that Franky Boyle or someone is within his rights to use a certain word or sentence.

Clearly, twitter and chatrooms have changed things in two obvious ways. Firstly, registering disgust has become massively easier, a problem which afflicts various service and hospitality industries, via user feedback websites. Secondly, movements of disgust can gather momentum and experience tipping points, until they dominate the headlines. This means that complaints can far outstrip the number of initial viewers, as 'Sachsgate' demonstrated best of all.

All of which turns public offence and defence into a game, involving strategy, scores, winners and losers. Offence can be measured partly in terms of how many people claim to be offended. But there are also PR-type strategies at work in terms of getting things into and out of the public 'conversation'. If they hang around for long enough, then it becomes apparently insensitive for political leaders to avoid confronting them (as both Ed Miliband and David Cameron seemingly felt in relation to Jeremy Clarkson's joke). Because the threat of over-reaction by the public is now so great, authorities often opt to over-react in the first place. For instance, this mildly irreverant Tim Minchin Christmas song was apparently pulled by ITV, before any offence had been taken. OfCom, which ironically was set up according to the most boldly technocratic principles of any regulator, is now in the unfortunate position of having to adjudicate over many such moral issues. Humour experts cannot be far behind.

What gets forgotten in amongst all of this is a fairly simple question: what does offence consist of in the first place? This NYRB article, reviewing two books on digust, might be a good place to start. I am perfectly willing to call Jeremy Clarkson a 'tosser', or even - if I thought I could get a cheap laugh - suggest that he be chopped into slices and fed to the rest of the Top Gear team. But I would find it difficult to watch the clip of him asking for marchers to be 'shot', and report that I am experiencing 'offence' or 'disgust'. To do so would be to descend to another form of moral failing: it would make me a 'liar'.

So what about the recent scandals surrounding racism by Premier League footballers? Maybe all of this over-sensitivity is a price worth paying, if it helps to out John Terry and Luis Suarez as racists and condemn them accordingly. But the problem is that these cases still feel like they're part of a game. The moral repugnance of racism gets almost overlooked, in favour of empirical questions, such as who said what, how do we know, what does the camera or microphone pick up, whose responsibility is it to act, what does the FA (or police) have to do in order for the issue to go away again, how will this affect his football or the England football team. It's almost as if John Terry's greatest mistake was to be so easily lip-read. Quite how or why a multi-millionaire England football captain thinks like that in the first place (or whether he really does) gets left in the shadows, by debates about what can be seen and confirmed as true.

As a result of all this, the age of transparency is also the age of the choreographed grovelling apology. The most disgusting - yes, I think I really mean that - aspect of the Aiden Burley 'nazi-themed stag party' scandal was the report that:

Aides tried to arrange for him to join a trip organised by the Holocaust Educational Trust to Auschwitz, the Nazi concentration camp in German-occupied Poland. But the Tory leadership moved against Burley after the newspaper reported on Sunday that he was responsible for hiring the Nazi uniform.

So their ruse didn't quite work. But the point is this: in the game of public offence and defence, Aiden Burley's aides sought to instrumentalise a Nazi concentration camp as a strategy to wrong-foot his opponents (perhaps in time for the lunchtime news). Personally, I hope Aiden Burley and his aides suffer serious disappointments in their careers, leading to prolonged regret and self-doubt. In front of their families. I'm not joking, but I am being offensive.

John Terry's PR team pulled off an equivalent coup, with this surreal headline. Is this where we're all heading to? Mobilising children, monuments and history as a means to distract the twittersphere for a few hours? Some bizarre logic of equivalence is underway, that one regrettable photograph or youtube clip can be cancelled out with one carefully planned (and photographed) gesture towards transcendent political ideals or tragedies. I suspect that Princess Diana may have set the stage for the politics of this new era.

The first wave of political correctness was idealistic, with shades of Orwellian mind control, but too technologically naive to tip into totalitarianism. It sought to police how people spoke, but with no means of achieving this, other than traditional education, debate and disapproval. As the inverse of this, the new wave of political correctness is technologically sophisticated, but with no ideals attached. It is purely concerned with catching people out, making them look foolish, putting them through the ringer for a few hours, days or weeks (depending on how much they are considered to deserve it).

But as a result, it has no concern with the unseen, the undetected or the not-yet-detected. It can work in tandem with professional investigative journalism (as with hackgate, MPs expenses and wikileaks), but it only judges what it can see. It reduces crimes and misdemeanours to their visible evidence, which can be cancelled out by the creation of equivalent visible counter-evidence.

the demise of football

Thomas Friedman famously offered the 'Golden Arches Theory of Conflict Prevention', on the basis that no two nations with a McDonalds within their borders had ever gone to war. Allow me to offer its successor: the 'White Goalposts Theory of Crisis Resolution'. This theory states that we will know that our present economic crisis is being resolved (rather than deepened), once a front-bench politician comes out and publicly attacks football, in terms of its business models, culture and economic norms, and not only for its sporadic eruptions of racism or corruption. My prediction, for what it's worth, is that this event will occur in October 2013, and that the politician in question will be Yvette Cooper, Leader of the Labour Party.

Football was once such worthless political currency that Margaret Thatcher publicly questioned whether England should be allowed to compete in the 1990 world cup, due to the threat of hooliganism. Euro96 was the turning point, although English hooliganism was still rife at the Euro 2000 championships. Since Euro96, no politician has had the guts to question any aspect of the game or its status within our media, public sphere or national self-image. The 'old' aspects of the game - racism and FIFA corruption - are routinely attacked, but the 'modern' game cannot be questioned.

But look how grizzly things are getting. I read last week that Carlos Tevez may be prepared to take a pay cut from his £250,000 a week job at Manchester City, on the one condition that his new club has it written into his contract that he remain the highest paid player in the squad. Wayne Rooney's behaviour regarding his Manchester Utd contract was criticised by many, but politicians repeatedly duck these issues, despite viewing consumerism, (some) advertising and (recently) X Factor as fair game. Energy oligarchs have removed whatever sense of 'level playing field' may have remained in the English Premier League, turning the top of the football labour market into a far less dignified version of what goes on in boardrooms, as players shamelessly strategise towards remuneration increases (hilariously still termed 'wages') through any means possible.

What precisely are we celebrating when we enthuse about football? Increasingly it is referred to as 'athleticism', in which case lets all start following Usain Bolt. If we have to turn our backs on the tediously-adored Barcelona at the same time, then so be it. It's a price worth paying. The football-obsessed sports shops in British high streets have nothing to do with athleticism or even physical exercise any longer. Just try buying some new laces, socks or functional trainers in JD Sports. You could come out dressed from head to toe as Michael Jordan, but there are much cheaper ways to get a fancy dress outfit.

Football is more interesting as a bellwether of contemporary capitalism, and should be criticised accordingly. Not long ago it was PLC ownership structures that looked like they were stripping the heart out of clubs, seeing them run 'for profit'. Now the problem is the opposite: they are owned by private billionaires, run 'for power', but at a vast loss. Roman Abramovich's takeover at Chelsea in 2003 thefore anticipated the broader trends that I've argued the present crisis will unleash.

Regulation School Marxists define a capitalist crisis as a situation where neither 'more of the same' nor 'less of the same' will resolve the situation. Our present debt crisis is a case in point. More debt makes it worse; paying off debt also makes it worse. Resolving such situations requires a fundamental revaluation - innovation not only in policy measures and mechanisms, but in the culture and values that underpin how government and business institutions operate.

The challenge of resolving a serious crisis is that it involves a degree of truth and reconciliation regarding the past. One often has to accept that critics (sometimes quite eccentric ones) are right, and even that they have been right for a long time. The demise of Keynesianism was as slow as it was because it involved coming to terms with the fact that full employment was no longer a useful goal of policy. This was a severe moral revaluation, not simply a technical paradigm shift. The enemies of Keynesianism (the monetarists) had to be welcomed in to the fold. This takes time and much pride swallowing. There is also some first mover advantage on these occasions, just as Britain seemed to benefit from giving up on the ERM, before its terms were loosened anyway.

To accept that football - or should we say 'Football' as an idea - may actually be part of the disease, and not a harmless supplement to our economy would take some pride-swallowing. The idea that 'talent' has its 'desert' in very large amounts of money is so ingrained, we so want it to be true, that we carry on adhering to it no matter how grotesque the spectacle it generates. The media maintains the pretence of separating Ashley Cole the 'talented' footballer from Ashley Cole the unruly working class 'yob' (as if the latter is just his unfortunate inheritance), ignoring the obvious liklihood that football is far more responsible for his noxious personality than his upbringing.

Those on the liberal-left are able to see through the rhetoric of bankers, when they demand that London remain a 'level playing field' so as to ensure that their industry's 'David Beckhams' are still attracted to work here. The liberal-left is able to debunk football as a metaphor. But why not go a stage further, and attack the whole sorry charade that's been making fools of so many people (me included) for the past 15 years?

Why must Jonathan Freedland write a sensible argument about extreme inequality in pay, but in the same article offer a justification for Wayne Rooney's £250k a week? Once you give in to the neo-classical vision of a labour market, that wages are simply a reflection of 'demand', then the door has been left ajar for the likes of Fred Goodwin. Why not just take the bull by the horns, and accept that the whole thing should just be shipped off to a vast in-door Nike sports complex in Dubai where it belongs? Is it not possible that the constant news reports of footballers attacking women, of fans being charged £50 a ticket and replica shirts being 'outdated' every 9 months, of Manchester Utd's Nani having a life-size marble sculpture of himself in his house do not happen inspite of the vast sums of money that are now at stake in this game, but because of it?

At some point in the future this will appear obvious. Soon after that, we will find it difficult to ever believe we tolerated, even celebrated, this circus in the first place - just as, by the 1990s, it seemed extraordinary to think that governments once targeted full employment. For the time being, any politician would shudder at the thought of criticising the game, as opposed to its undesirable 'externalities' or its metaphorical distortions. Which, according to the White Goal Posts Theory of Crisis Resolution, only goes to show how far into our current crisis we are: not even half way.

The new conservatism began/ In nineteen seventy three...

Amidst the fall-out from David Cameron's European veto, whose logic I cannot compute (I have always considered myself far too nice to fully understand either statecraft or Tories), I've been struck by an analogy between American and British conservatism. For rightwing parties and conservative movements, Britain's membership of the European Union has a number of parallels with the US Supreme Court's abortion ruling in Roe v Wade. Just think...

In 1973, at the fag-end of the 1960s, the state takes a historic modernising, cosmopolitan, liberal decision, in keeping with the spirit of an age which is drawing to a close. The decision is supported by many modernising elites from across the political spectrum, but creates strong feelings amongst traditional conservatives, including those who had traditionally voted for the centre left party. This contributes to a conservative victory at the close of the 1970s, led by a conviction politician who spoke the language of traditional social values, winning working class support despite economic policies that later destroyed working class jobs. The rhetoric of family values and nation was turned against both left-liberals and establishment elites, both of whom were held guilty of having betrayed core national values, as manifest in that 1973 decision.

However, the conservative victors of the 1980s did very little to reverse the liberal legacies that they'd inherited, including the 1973 policy itself. They were able to blame unelected, rule-obsessed liberals, for the aspects of modern society that offended traditional values and angered the rightwing media, to great effect. The 1973 decision itself was not really a politically live one until the 1990s, when it became the cause celebre of an entirely new generation of conservatives. Until the 1990s, socialism had been the main preoccupation of conservative animosity, but this spectre swiftly disappeared after 1989. By the mid-1990s, a centrist government was finding that a new, angrier, unreasonable strain of conservatism was making governing almost impossible. The executive was in daily war with the legislative. And it was the historic 1973 ruling that got them angriest of all.

This new, less reasonable conservatism posed a serious problem to the rightwing party. It was both tempting to pander to it, but also dangerous, in view of its unpredictability and its slightly messianic commitment to a single moral issue, to the exclusion of economics or utilitarian policy analysis. The rightwing party wanted its energy, but also feared how its seething anger and obsession with matters of constitutional principle might alienate swing voters. What should they do?

There is a huge amount about the analogy that doesn't work. I don't know exactly how democratically popular abortion is in the US, but I suspect that it is much more popular than Britain's membership of Europe, which attracts very little public support. There is also a vast difference between a secular issue of national sovereignty and a metaphysical issue of 'life' (as it is defined by US conservatives). I doubt Britain's entry to the single market did much to further Thatcher's cause in 1979, whereas Roe v. Wade did much to encourage the 'Reagan Democrats'. Plus entry to Europe was carried out by an elected government, not by an unelected judiciary.

And yet the historic rhythm of each issue is similar, especially the way in which the 'angry white men' appeared twenty years after the crucial (liberal modernising) decision had been taken, and appeared hell-bent on subverting sensible government, without regard for public opinion. The removal of the socialist bogey-man led conservatives in search of a new enemy, which they found in the fallout from the 1960s. The new breed of Tories are just as hostile to their 'wet', pro-European Conservative forbears as The Tea Party is to the GOP establishment.

Today, I can see three reasons why a young, aspiring politician would want to join the Conservative Party. Firstly, because it offers them a comfortable rural existence, combined with access to London's toff circuit. Secondly, because they are ruthlessly opportunistic, and would happily have stood as Labour candidates if they'd been born 10 years earlier (this applies more to political advisors than to MPs). Thirdly, because of animosity to Europe, or at least some commitment to the British establishment that has recently become re-framed in anti-Europe, patriotic terms. Cameron and George Osborne betray elements of all three; but the point is that there is no longer a pool of Geoffrey Howe or Michael Heseltine types, for whom the Conservative Party offers opportunity for respectable and traditional public service. Ken Clarke is last man standing (would his equivalent be John McCain?).

Europe has become crucial to the identity of contemporary British conservatives, just as abortion is to American conservatives. This is not a rational or economic issue any longer, and David Cameron must have believed that his European veto would grant him the form of power over his party that Thatcher and Major never achieved. He appears to be banking on the notion (contradicted repeatedly by Tony Blair) that the adoration of his party would be an invaluable political asset.

But has he fully understood conservatism? Perhaps not. The genius of the US Republican Party over the past 20 years has been to stoke the flames of conservative anger, rather than to douse them with the policy changes they demand. Much of the Republican's political strategy has been neo-conservative, not conservative, that is, cynically and cleverly exploiting 'values' and religious belief, in the service of secular realpolitik - the lesson of Leo Strauss. Karl Rove, I'm guessing, would never have wanted to see Roe v Wade repealed (were that even possible), for that would have immediately dampened the ire of millions of angry, Republican voters. Tony Blair, also, recognised that if politics is fundamentally about 'friend-enemy' distinctions, that destroying enemies is a far smarter route to keeping friends on board, than simply giving them what they clamour for.

Cameron has opted for a far less strategic route, suggesting that he may be more 'con' than 'neo-con' - a naive position to hold, in a modern capitalist global society. His back-benchers will demand more concessions from him, leading eventually to a full withdrawal from Europe, whereupon the cause celebre that drew them from their rural idyls and their Mayfair hedge funds in the first place will be lost for good.

1991 revisited

The post-socialist moment of the early 1990s throws some interesting light on our current predicament. Was there anything that could be recovered from the socialist scrapheap? I recently discovered Robin Blackburn's long 1991 essay in the New Left Review, Fin de Siecle: Socialism After the Crash. It's a fascinating read, not only for how it picks apart the successes and failures of 20th century socialism, but also for how he envisages a future for socialism, that learns from its 1989 demise. Many of his proposals and ideas for a liberal, 'market socialism' seem eerily relevant to our current predicament, twenty years later. This sounds like a sound recipe for a post-Fred Goodwin age:

Why could not publicly owned banks hire investment specialists or managers, just as banks or pension funds do in today’s capitalism? The successful socialist entrepreneur, whether investment banker or manager, would not, of course, be able to claim the hypothetical ‘full fruit’ of the results of his or her expertise, but neither does the professional today. They would be able to derive intrinsic satisfactions from their job, and they could easily be offered well above the average rate of pay if this was found necessary to their motivation. In a generally egalitarian socialist society quite small differences of pay could be quite highly valued by certain individuals. And it might even be discovered that there were potential entrepreneurs who had been deterred by the morally obnoxious consequences of successful management under capitalism, such as depriving others of a livelihood by closing down a plant. And even in a pattern of socialist economy that encouraged worker-participation and enterprise democracy there would still be ‘positional goods’; the elected manager, indeed, might obtain satisfaction from the discharge of his or her responsibilities rather more legitimately than the owner-appointed manager. If the more acceptable motives failed to work, would not the recourse to differential economic rewards re-create class division? A principled realism might allow that if incomes vary only modestly, and are prevented from being invested in ownership of productive property, then this could permit some incentive element without allowing social differentiation to acquire class-like self-reproducing dimensions and forms.

The banks or holding companies could be encouraged to make a proportion of their funds available for more risky investments or for socially desirable investments, by tax breaks. They could be encouraged to display responsibility as well as initiative by linking them to corporate entities based on pension funds or municipal development boards. The ‘social’ in social ownership should not be derived from one privileged economic agent—the nation-state—but from a plethora of differently constituted but accountable public bodies.

For most of the past 20 years, this would have all read like far-fetched socialism. But in the context of our current, deepening crisis, it highlights a very relevant question: at what point will a frontline politician dare to suggest that UKFI (the organisation which owns and directs part-nationalised UK banks) pursue objectives other than a narrow definition of 'value' to the taxpayer?

Many figures in the employee-ownership movement, including Charlie Mayfield Chair of John Lewis Partnership, have suggested that the government could support the creation of new types of ownership, by virtue of our semi-nationalised banking system. Could UKFI take a view on what types of businesses RBS and Lloyds-TSB should be supporting? Of course it could. But we'd then be heading back to the 'socialist accounting' debates of the 1920s. As of December 2011, I suspect that this turn towards active, 'social value banking' is unlikely to happen any time soon. But it will be interesting to see if and how UKFI becomes a live political issue over the course of 2012. There: my little tip for the New Year (the other one is 'Travel Chaos').

Marxism Today remembered

The ippr's edition of Public Policy Research, dedicated to remembering and learning from Marxism Today, is now out. The individual articles can be downloaded here, for those with university log-ins.

The purpose of the edition is to ask how the approach taken by Eric Hobsbawm (interviewed in it), Martin Jacques, Stuart Hall et al might be updated for the Left's current purposes. How might the 'new times' of post-2008 political economy and post-Blairite politics be understood today, so that the Left can work with sociological forces, and not against them? This question isn't without some controversy, seeing as how it typically credits the Left's opponents with considerable cultural credibility and political authority. At a discussion of this legacy at the ippr last night, a number of former contributors noted the curiosity of the fact that this was a journal that was both tightly disciplined, fiercely edited and bankrolled by the British Communist Party, while also injecting a form of pluralism, lightness and open-mindedness into the Left that represented an exit route from the macho ideological infighting of the early 1980s.

My contribution has already been trailed in The New Statesman, and David Miliband's was trailed in The Observer on Sunday. You can also read an edited version of Tristram Hunt's contribution on the ippr website.

Update: You can watch Martin Jacques, David Miliband, Charles Clarke and Graeme Cooke discussing all of this below.