These might well be exciting times to be in the Labour party, writes Carl Packman.
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This was the week that Ed Miliband decided to deliver plans for the banking sector, just days after the Libor scandal rocked Barclays and the entire banking sector.
Ed’s call is for there to be room made for more competition by the “big five” banks, obliging them to sell up to 1,000 branches to do so.
The speech, made at the London headquarters of the Co-operative Bank, coincided with the publication of Labour’s case for a British Investment Bank to help the business sector.
As former city lawyer Nick Tott, author of the newly published report, notes examples of state backed banking institutions can be found in Canada, France, Germany, Italy, Japan, Russia and the USA – so it is high time the UK caught up.
And plus it is high time we address the issue of inadequate bank lending.
As Duncan Weldon at the Touchstone Blog has pointed out:
“Even during the ‘good years’ around 85% of bank lending was going to either financial companies or property.”
A British Investment Bank could go some way of correcting the inability of today’s banking system, to support small and medium sized enterprises.
When companies such as Wonga, of all places, are starting to offer their own loans to businesses we know the system is in trouble (though when I spoke to one of their spokespeople he could only offer anecdotal evidence that thousands of applications for their business loan had been received).
Something else that Weldon noticed, also picked up by the Financial Times, was Ed’s reference to the Vickers recommendations.
Labour had always planned to implement the Vickers recommendations in full – but now that is only a “starting point”. This has caused a mini-stir, implying that Labour are thinking about setting rather more radical plans over and above Vickers.
So how far could Labour go? Fortunately, not too far behind Ed’s speech was some perfectly timed noises from Lord (Maurice) Glasman. Speaking last week at the London School of Economics with Lord (Robert) Skidelsky, and on the Guardian’s Comment is Free pages, he had some ideas as to where Labour could go in order to move beyond Keynesian economics and rediscover its own socio-economic roots.
For Glasman, there are two major bones of contention with Keynes, especially in the context of the UK’s current financial predicament. Namely that Keynes is the economist for crisis management, and for this he works very well, but where are his solutions for growth that are not reliant on the Treasury or centrally collected taxation/centrally administered spending to generare growth.
• Miliband lays in to ‘Millionaires’ PM’ at last PMQs before recess 11 Jul 2012
• Miliband attacks “slow to act, bankrolled by the banks” Cameron at PMQs 4 Jul 2012
• Miliband redirects Barclays rage to Cameron over PM’s inaction 30 Jun 2012
Secondly, Keynes is not the economist for local economic genius.
As he puts in his Guardian article:
Apart from the odd flashes of ambiguous insight in chapter 12 of The General Theory of Employment, Interest and Money, there is not much going on in Keynes concerning regional, sectoral or vocational institutions within the economy, or any mediating institutions between the individual and the state.
So to go beyond crisis management, we must go beyond Keynes and build up regional, sectoral or vocational institutions within the economy. Where do we go?
Glasman hints at Catholic Social Teaching on more than one occasion, both in his Guardian article and during his talk with Lord Skideslsky. The main economic philosophy to have been developed out of the principles of this teaching is the economics of distributism.
The basic tenets of distributism are a defense of property ownership as a right, but with ownership being spread across as widely as possible, opposed to centralised state socialism, or indeed democratic centralism, and laissez-faire capitalism, which usually culminates in near-monopolistic levels of ownership.
It is essentially the economics of how Lord Skideslsky described Catholic Social Teaching: as an “anti-capitalist defense of private property.”
(It ought to be noted that Philip Blond, who was to the Tories what Glasman is to Labour, is also something of a distributist. Their friendship and similarities do not go unnoticed, and the conspiritorial among us may even suppose that they’ve chosen to pursue their political philosophy in different parties, in the same way a gambler places bets on two opposing football teams so as to get a reward for whichever team pays out – unless, indeed, it is a no-score draw).
GK Chesteron, the novelist and a proponent of Distributism, once pointed out:
“Too much capitalism does not mean too many capitalists, but too few capitalists.”
In this same way, Glasman, in a glimpse of his own Chestertonian vision, does not want Dover port to be privatised (he said at the LSE that a French company wants to buy it – to which Skidelsky said “they”ll run it better won’t they”), or state-owned, but its assets owned by the people.
It’s Glasman’s mutual moment – we should all own capitalism, from ports to banks. If Miliband is signalling that Labour can go further then Vickers then this could be the ticket.
As Glasman pointed out, Catholic Social Teaching can show us a lot about the differences between predatory and productive capital. Dissenters might want to mull over that for a while. On the left we’ve spent so much time criticising neo-liberalism, rightly, that we’ve failed to develop a modern critique of capitalism distinct from it, such as distributism.
Might it be the case that where anti-capitalism has focused solely on corporatism (the devil you know), to which books like No Logo have been bought lock, stock and barrel, that we haven’t grown wiser about what capitalism might look like separated from it?
People will surely turn their noses up at Glasman (just mention him on Twitter and see what happens). Though I think there has to be something in this. Glasman has begun to develop a criticism of Keynes that isn’t Marxist or lassiez-faire capitalist, but organised it in a distinctively modern way.
To many, that this is possible isn’t a surprise, but it has been off the political table, at least in the UK, for some time.
He has also prompted us to look harder at what capitalism is in theory, in practice, and in potential. And this comes at a time when Labour are starting to get their act together on the way in which the UK organises its financial practises.
These might well be exciting times to be in the Labour party.
46 Responses to “Lord Glasman has developed a criticism of Keynes in a distinctively modern way”
Roger McCarthy
As one of the few people on the left who has actually read deeply in the Catholic Social Teaching to which Maurice Glasman is so inexplicably devoted it seems very odd indeed to label ideas first promulgated (in Latin!) by Pope Leo XIII in 1891 and given their fullest development by the likes of Chesterton and Belloc in the late 1900s and 1910s as a ‘distinctively modern’ response to Keynes (whose magnum opus wasn’t published until 1936).
These ideas are only new in the sense that they became decidedly toxic after WW2 when a surprising number of their supporters turned out to be fascists – starting with Chesterton himself who banged the drum for Mussolini’s invasion of Abyssinia in 1935 – and have been forgotten for so long that they are indeed new to anyone other than specialist historians.
(It’s another essay but I’d argue that the later strand of CST that started out with Vatican II is rather different and far more corporatist in the 1960s and 1970s sense and is not in any case Glasman’s primary reference point).
And the arguments which both left and right wing critics advanced against Distributism when it was still a living political force (as well as the extensive critique levelled against its feudal socialist and Proudhonist precursors by Marx in The Communist Manifesto and The Poverty of Philosophy) are still equally potent today: if one could more equitably redistribute property rights any sort of free market will once again cause them to become more and more unequal.
In a purely agrarian society (which is what distributists would clearly prefer) this might theoretically be corrected by periodic land re-distributions and elaborate forms of entail like those actually implemented by Nazi Germany – but in an industrial (never mind post-industrial) society this is clearly absurd and impossible.
And you don’t have to go back very far at all to see how quickly a distributist programme can be undone by the market – various post-Soviet states engaged in quite grand experiments of giving the ownership of industries and housing and former collective farms to those working and living in them – and within a very short time indeed these societies had become either carbon copies of their capitalist neighbours or in the case of Russia (and now China) a true plutocratic oligarchy.
Because if they are truly property rights then people WILL sell them either through greed (as happened in our great de-mutualisation wave) or desperation as happened in the former eastern bloc.
Now a mutualist society built around co-operative enterprises where ownership is collective and inalienable rather than individual and transferable is another thing altogether – but this is not what Leo XIII and Chesterton and Belloc had in mind.
Robert CP
Lord Glasman has developed a criticism of Keynes in a distinctively modern way, writes @CarlRaincoat: http://t.co/eFRD1GZu
Carl Packman
RT @leftfootfwd: Lord Glasman has developed a criticism of Keynes in a distinctively modern way, writes @CarlRaincoat: http://t.co/VVaoIQSi
Chris Dietz
Lord Glasman has developed a criticism of Keynes in a distinctively modern way, writes @CarlRaincoat: http://t.co/eFRD1GZu
The Interzone Media
Lord Glasman has developed a criticism of Keynes in a distinctively modern way, writes @CarlRaincoat: http://t.co/eFRD1GZu