OF all post-war Conservative premiers apart from Winston Churchill, it was perhaps Margaret Thatcher who was a true master of the political soundbite. One of her most memorable Tory crowd-pleasers was this one attributed to her during a 1976 television interview, three years before she became prime minister: “The problem with socialism is that you eventually run out of other people’s money.”
This dismissal of socialism managed to combine all the inaccuracies and false assumptions that Conservatives like to convey when making their case for avarice and trashing the concept of sharing. You had to hand it to her, though. Few others have been able to condense entire swathes of political fiction into such a tidy locution.
A rather more accurate, if less pithy summation of Thatcher’s beloved free-market mantra might look like this: “The problem with capitalism is that it never runs out of other people’s money, mainly because the banks keep the taps running.”
Echoes of Thatcher’s contempt for socialism could be found in his column yesterday by my esteemed National colleague Michael Fry. Socialism always fails, he said, and it’s just like Soviet communism. There were references to that enchanted land that exists in the imaginations of all Conservatives: “The Real World”.
I doubt though that even Thatcher would attempt a defence of the International Monetary Fund, an organisation that exists to maintain a safe distance between the few that have the most and the many who have the least. The IMF’s approach was best summed up in 2010 by Brazil’s executive director to the IMF in response to the organisation’s support for the Greek loan programme: “This may be seen not as a rescue of Greece, which will have to undergo a wrenching adjustment, but as a bail-out of Greece’s private debt holders, mainly European financial institutions.”
The essential wickedness of capitalism has been exposed in the behaviour of its biggest adherents during coronavirus. The earliest economic advice we all received from parents, teachers and bank managers was to save money for a rainy day.
Yet, in the first weeks of the global pandemic, we observed dozens of multi-billion corporate behemoths ruthlessly tossing aside its lowest-paid employees despite years of raking in eye-watering profits.
This was their rainy day and they had the money to see them through it, but nothing could be permitted to interrupt the flow of dividends to institutional shareholders. Others sitting on large personal and corporate treasure troves nevertheless availed themselves shamelessly of the furlough scheme.
The author Naomi Klein, in her 2007 book The Shock Doctrine: The Rise of Disaster Capitalism, explains how force, stealth and crisis are used to deploy neoliberal economic policies such as mass privatisation, deregulation and cuts to social services.
Klein makes an analogy with the electroshock experiments carried out by the Scottish psychiatrist Ewen Cameron for the CIA in the 1950s. Cameron’s methods on damaged minds forced them to regress to a blank state on which he could impose a new personality.
A process such as this, she argued, is used to impose neoliberal economic and cultural regimes throughout the world. At its most basic and inhuman level, wars are deliberately waged to stimulate growth in property development and arms manufacture. Halliburton’s partnership with the US Government in both Iraq wars is perhaps the most egregious recent example of this.
In May, Antonio Guterres, the secretary-general of the United Nations, urged the expansion of post-coronavirus debt-relief programmes to help the world’s poorest countries. According to UN official figures African nations are servicing a $45 billion debt bill and rising for 2020.
READ MORE: No country’s done well from socialism – why would Scotland be any different?
THE UN estimates that around 60 million people living in the world’s poorest countries now face a future where any hope they had of relief has been extinguished by the coronavirus and the refusal of the west to cancel historic debts. Many of these loans were organised by the IMF and World Bank for regimes they knew to be corrupt and genocidal.
One of these was the apartheid regime in South Africa, which drew greedily on irresponsible lending by the IMF to fund military adventures and to support its synthetic fuel industry, by which it sought to mitigate oil sanctions. Since then, appeals by the post-apartheid government to have these ill-gotten debts forgiven have found short shrift in the global finance system.
For this would break the first two rules of capitalism: there shall be no mercy, and if you grow tired of keeping your foot on the victim’s neck, replace it with the other one.
It’s left South Africa and many other poor nations at the mercy of vulture funds. These pounce on discounted debts, buying them cheaply and then extorting the full, original sums owed by means of legal hit squads.
The same principles of capitalism are found in the multi-million-pound orders placed by the UK Government for dodgy PPE equipment without a legal tendering process. It’s found in the activities of global hedge-fund managers who have exploited the pandemic to increase their wealth.
In April this year, it was revealed that one London hedge fund had made £2.4bn betting on the market as investors began to get fidgety over the impending economic shutdown.
The Guardian reported that Crispin Odey, the Brexit supporter who made millions betting against the pound in the run-up to the EU referendum, had admitted his fund had made its biggest monthly gain since the financial crisis of 2008.
It’s important to distinguish here between responsible entrepreneurialism and capitalism. The first recognises the role of labour in commercial success; the second is fuelled purely by greed and profit at any cost. Of course, those states which strive for socialism face challenges. They are blockaded (Cuba) by paranoid larger neighbours; rich people and corporate interests immediately instigate the flight of capital when a left-wing government is democratically elected (UK) and affluent western governments demand the return of loans at crippling interest rates (Africa).
And if all that fails, they simply assassinate the president (Chile); send in death squads (Nicaragua) or bomb the b*stards and wreck the joint (Iraq).
Socialism is flawed, not the least of the issues being the human weaknesses of its proponents. In Britain though, it has delivered free higher education; proper housing; free universal health care; fair wages and social security. It has forced employers to treat their staff with compassion and humanity. Capitalism and its apologists resisted all of these and would ditch every one of them given half a chance.
The effects of coronavirus and a hard Brexit have created a rich spawning ground for disaster capitalism to flourish in the UK. It’s what Dominic Cummings has been planning for many years and, in Boris Johnson, he has found his perfect glove puppet.
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