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').

Comments

[Dick Pountain]

Blackburn's piece certainly reads well. But surely since we're all agreed on the desirability of market socialism then we don't need to repeat the "socialist accounting" debates but rather start a "mutualist accounting" debate - how to handle a transition to employee shareholding, the legislation needed, balance between founders and transient employees etc etc etc. We also need to have a "vote accounting" debate about lobbying, party funding, election advertising etc, to try and reverse the capture and suborning of government by finance.

[Dick Pountain]

PS "all agreed" was ironic

[UKFI Not FFP]

Let's not wait for a frontline politician to suggest that UKFI pursue other objectives?
I've managed to get an epetition published on the role for UKFI. It's in generalist terms about Value For Money for taxpayers. Please have a look at http://epetitions.direct.gov.uk/petitions/28557 and any help getting it publicised would be appreciated.

Regards

UKFINotFFP