“The substance of the eminent Socialist gentleman’s speech is that making a profit is a sin, but it is my belief that the real sin is taking a loss.”
Sir Winston Churchill
What if the ‘real sin’ is neither, but to engage in a particular economic activity in the first place? Is it a sin to leave the rainforest alone, or is it ecocide to destroy it?
Conventional economics is not neutral about the desirability of economic activity. It places no limit to the extent of the economy. Nor does conventional politics. The centuries-old battle of ideas between laissez-faire and State intervention is over which can achieve the most growth in the shortest time at the lowest cost.
Is growth necessary? If growth is zero, the same quantity of goods and services is constantly being brought into being, so provided the workforce to produce them and the population to consume them also remain constant, no-one is any worse off than before. The lack of growth causes panic only because so many decisions are based on the idea that growth will continue, and so it must continue. In this game, the only options for those in control of the economic process are to increase their income through attacking the environment (growth) or through attacking society (austerity). Just stopping the treadmill is unthinkable.
In reality, the model has to be modified in a number of ways. Population is not constant: even within a constant total there will be ongoing changes in the age structure that affect the size of the working population. Natural resource costs are not constant either: as the energy cost of accessing resources increases, so does the overall cost even of maintaining a constant output of goods and services. The implications are that we ought to be debating what kind of society we wish to see in the future, and within what limits, rather than blindly following the assumption that we can have more of everything yet lose nothing important in the process.
Public policy, which is well-placed to uphold the holistic view that the economy is a wholly-owned subsidiary of the environment and not the other way round, is increasingly not up to the job of framing that rounded debate. The problem of regulatory captureis becoming acute, with even the most environmental of national agencies, such as English Heritage and Natural England, now seeing their remits redefined to support development at pretty much any cost. Massive damage is happening, but we are assured either that we are wrong to perceive it as negative at all or that the benefits outweigh the harm. Either way, it is our values and priorities that are attacked as the ‘problem’, not the damage that is being done to them.
There is no clear mandate from the electorate for governments to implement a totalitarian liberal agenda – one that marginalises any view that there is more to life than consumption – yet that agenda is being rolled out anyway. The idea that the State should promote pro-growth policies is an old one, but one previously balanced by others. One traditional conception of the State is as neutral adjudicator between competing interests. It is a role that cannot be fulfilled if the State has repeatedly thrown in its lot with one side.
Libertarians may point out the extent to which fiscal considerations compel the State to back the ‘wealth creators’, to the detriment of others, in order to go on funding its spending commitments. It is certainly worth asking if the UK is living beyond its means precisely because it is the UK. Radical decentralisation – and even independence in some areas – could cut the cost of government substantially by reducing distances between the decision-makers and their decisions, as well as by curbing unproductive military expenditure. (Libertarians in fact tend to be quite protective of the coercive forces of the State: they’ll happily pay for the security of others’ persons and property, just not their education or healthcare.) But radical decentralisation also risks empowering those with a democratic, anti-growth agenda, potentially placing barriers in the path of universal growth, and so has many enemies.
Research suggests that large industries are very good at capturing large governments and then using them in ways that are detrimental to local areas that lack the constitutional power to resist. The much more robust response to the financial crisis in Iceland as compared with that in the UK – or the EU generally – illustrates the point. The reverse may also be true – that small governments are vulnerable to capture by small industries concentrated in small areas. The domination of local councils in seaside resorts by hoteliers and restaurateurs is a familiar theme in Wessex. There seems much less reason, however, to suggest that this isn’t what local voters want. A balance seems most likely to be achieved where there is a diversity of industries, in terms of both range and scale, such as might be expected at the regional level or in areas not dominated by one sector that is a major source of public revenue.
Other means of limiting regulatory capture include appointing staff with a public or voluntary sector background in preference to those with a business background. The whole ‘revolving door’ culture which has been assiduously cultivated over the past 35 years has been fatal to perceptions of integrity but is the inevitable consequence of disregarding the need for government to remain neutral when dealing with commercial interests. ‘Experience of the real world’ isn’t helpful if all that is learnt is the fine art of corruption. How are politicians to rely on impartial advice that is potentially tainted, by past connections or future prospects? The rebuilding of integrity in public administration is as important as devolution itself in creating the kind of Wessex we wish to see. Why not have more of a ‘them’ and ‘us’ relationship between business and government? It’s a whole lot healthier, because it isn’t the job of government to help the private sector. It’s the job of government to govern.
One other side-effect of the revolving door culture has been the corruption of the language, so that the democratic sector now sees itself as serving ‘customers’ (rather than patients, students, arrestees and so on). The implication is that all relationships can be, and ought to be, reduced to cash, which in turn reinforces the idea that life is economics and economics alone. The democratic sector needs to be different in its whole outlook from the commercial sector, precisely because its difference is its justification. Making things ‘more businesslike’ can be a catchy way of saying that there should be a constant search for efficiency but take the analogy too far and the organisation ends up totally efficient but totally ineffective.
Last month, the Leader of Blaby District Council, in Mercia, took the astonishing step of describing himself as naïve in believing his party’s policy on localism, as it had been expressed in opposition. Yet he’s still a member of that party. To overthrow the tyranny of growth before it wipes out every decent human value requires a whole range of actions. Mass resignations from the London parties, of course. But also the replacement of political structures that privilege the least attractive economic interests with new structures that place decision-making beyond their grasp. That revolution starts in the mind, with a simple substitution of loyalty to Wessex for a worn-out loyalty to London that has been comprehensively betrayed.