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Slumlands — filthy secret of the modern mega-city

Across the world, slums are home to a billion people. The rich elite want the shanty towns cleared,

There is a long curve of water and, as far as the eye can see, there are shacks, garbage, washing, tin, bits of wood, scraps of cloth, rats and children. The water is grey, but at the edges there's a flotsam of multicoloured plastic rubbish. This is the Estero de San Miguel, the front line in an undeclared war between the rich and poor of Manila. Figures emerge from creaky doors to move along bits of walkway. In the deep distance is the dome of a mosque; beyond that are skyscrapers.

Mena Cinco, a community leader here, volunteers to take me in - but only about 50 yards. After that, she cannot guarantee my safety. At the bottom of a ladder, the central mystery of the Estero de San Miguel is revealed: a long tunnel, four feet wide, dark except for the occasional bare bulb. It's just like an old coal mine, with rickety joists, shafts of light and pools of what I'm hoping is water on the floor. All along the tunnel are doors into the homes of as many as 6,000 people.

We knock on the first one that's ajar. Oliver Baldera comes blinking to it, pulling on his shirt. On the floor behind him are his four kids, eating ice cream. His wife joins him.

The room is eight feet by eight and forms their entire dwelling space. It contains everything they own: a television, four bowls of ice cream, a light bulb, a mattress and the clothes they are wearing. "We've been here more than ten years," he says. "There's no choice. I'm a carpenter in the construction industry. We came from Mindanao."

Why did he move? "Because of poverty. It's easier to get a job here and I can earn 400 pesos a day. I can send the kids to school and they eat three times a day - but it's not enough. I need more space."

“But they're happy," Mena chips in.

Further along, there's a shaft of light and some kids are splashing about in a blow-up pool. Mena makes them sing. One of them comes up to me. "What's it like living here?" I ask. Mena mutters something to him in Filipino. "Happy," he says, and smiles.

This is a place where you cannot stride along without hitting your head or bruising your elbow, so people creep and shuffle. Here, you cannot go to the toilet without standing in a queue. Here, sex between a man and a woman has tohappen within breathing distance of their kids and earshot of 20 other families. This is the classic 21st-century slum. A billion people live in them, one in seven of the world's population. By 2050, according to the United Nations, there could be three billion. The slum is the filthy secret of the modern mega-city, the hidden achievement of 20 years ofuntrammelled market forces, greed, neglect and graft.

Yet Mena, at my elbow, is feeding me an incessant mantra: "We are happy; there is social cohesion here; we are organised; it is clean." The reason is this - the Estero de San Miguel has been condemned. The president of the Philippines, Benigno "Noynoy" Aquino, has decided to clear Manila's slums and send half a million people back to the countryside. That suits the business elite and the political clans that run the country fine. "Many of our people are no longer interested in agriculture, so we need to give them incentives to go back," says Cecilia Alba, head of the national Housing and Urban Development Co-ordinating Council. "If we had to rehouse the slum-dwellers inside Manila in medium-rise housing, it would cost a third of the national budget."

At the top of the list for relocation are the residents of the Estero de San Miguel. They will not go without a fight. "We will barricade and we will revolt if we have to," Mena says. "We will resist slum clearance and we will fight to defend our community. We are happy here."

This is not an idle threat. On 28 April, residents of the Laperal slum a few miles away engaged demolition teams with Molotov cocktails and guns in a riot that injured six policemen and numerous slum-dwellers. An arson attack had wiped out most of the area's dwellings ten days earlier.

Technically, global policy is on the side of the rioters. In 2003, an influential UN report, entitled The Challenge of Slums, signalled a shift away from the old slum-clearance policies and recognised that informal settlements make positive contributions to economic development. They house new migrants; because they are dense, they use land efficiently; they are culturally diverse; and they offer numerous opportunities for ragged-trousered entrepreneurs.

“Ten years ago, we used to dream that cities would become slum-free," says Muhammad Khadim of UN-Habitat. "The approach has changed. People see the positives. The approach now is not to clear them but to improve them gradually [and] regularise land tenure."

Cameron Sinclair, who runs the non-profit design firm Architecture for Humanity, goes further. "A slum is a resilient urban animal. You cannot pry it away," he tells me. "It's like a good parasite. There are some parasites that attack the body and you have to get rid of them but, within the city, the informal settlement is a parasite that acts in harmony with the city, keeps it in check."

Sinclair, whose organisation has upgraded slums in Brazil, Kenya and South Africa, believes that modern city design should not only tolerate slums but learn from them - and even emulate them. "To be honest, what we lack in a place like London is that the lower classes can't live in central London and have to commute for two and a half hours to do the jobs that keep people going."

What has driven the new thinking is ugly economic facts. After the 1970s, there was a sharp slowdown in the provision of social housing. The free-market revolution in the cities has led to the retreat of state provision, the rise of the informal economy and the rapid impoverishment of the rural poor. As a result, we are having to ask ourselves a question that would have made the 19th-century fathers of city planning shudder: do we have to learn to live with slums for ever?

It's a question to which the Filipino political elite have defiantly answered no.

“Should I buy them ice cream?" Regina "Gina" Lopez asks me, tilting her white Stetson as she leads me through what is left of a slum called the Estero de Paco. Teenage boys wearing hip-hop clothes and baseball hats are crowding, shirtless, around Gina. It's one of their birthdays, so should she buy them ice cream? Gina's trouser suit is the colour of ice cream. She is lithe, slinky and 61 years old. Among the 30 people with her are two cops, a media team of six, guys from the local community, her bodyguards, factotums and a man in dark glasses who is carrying her handbag.

Gina is a TV star, philanthropist, boss of the Pasig River Rehabilitation Commission and, most importantly, a member of the Lopez family. Lopez Inc owns much of downtown Manila - the energy company, a TV empire, a phone company - and has interests in all kinds of infrastructure, including water. Who better than Gina, in a country untroubled by worries about conflict of interest, to lead the forcible removal of slum-dwellers from the waterways?

The Estero de Paco used to have slums right down to the water's edge, just like the San Miguel. Now, instead of shacks, there is a neat border of agapanthus and rubber plants. State-of-the-art oxidation units are turning the brown sludge into something chemically close to H2O. Into the space that has been cleared, work gangs are laying a wide-bore sewage pipe.

As Gina approaches, a group of women from the slum falls into line and salutes. The women are middle-aged and poor; their T-shirts bear the words "River Warriors". They stand to attention and Gina, Prada-clad, goes into a drill routine: "River Warriors, atten . . . shun!" Then there are slogans about honour and playing for the team and some more of the drill, before they all fall about laughing. "I ordered them to dive into the water," she giggles.

The idea behind the River Warriors is serious. The clearance of the Estero de Paco was "non-negotiable". The Warriors' job is to make sure that those who have been cleared do not come back. "They will poo here! They will throw garbage," Gina says. "They would come back, if we didn't guard the place. So we work with the ones who are compliant. To make a change like this, you have to work with a chosen few, the vanguard."

The clearance programme works like a giant scalpel. Four metres of land is all that is needed to create the easement for the waste pipe, so a second, deeper layer of slums remains - you can see where something has sheared through walls, windows, dirt, alleyways. This is social engineering on a vast scale. It's what the government has decreed for half a million people. Like the slum-clearers of 19th-century London and New York, Gina has a missionary enthusiasm. "You can't live well if you're faced with the constant smell of faeces, right? You can't live a decent life on top of a sewer. Even if those people want to stay there, [they can't because] it has a wider impact on the city, the environment: we can't clean the water and bring the river back to life if they're there; the crime and sickness have a big impact on the environment."

With Gina out of earshot, two of the River Warrior women quietly tell me that they are secret returnees. They were moved on to a place called Calauan, four hours away by road, but have come back. I demand to see Calauan. "No problem," says Gina, flipping open her mobile phone. "Get me aviation."

The chopper skims low across Manila Bay. It's fringed with slums and, out in the bay, there are homes on stilts. "Even the sea is squatted," Monchet Olives, Gina's chief of staff, tells me. Soon, the skyscraper outline of downtown Manila disappears. We're above rice paddies; in the distance, there are mountains. Calauan comes into view - neat rows of single-storey housing, their tin roofs glinting. The whole complex houses about 6,000 families and there is room for many more.

On the streets, density is not a problem. The public space is deserted. There's a playground; there's a school with the name Oscar Lopez painted on the roof. The problem is - as Monchet concedes - there is no electricity, no running water and no prospect of ever getting any. And no jobs. "When it comes to electricity, we're between a rock and a hard place," he says. "Many of the new residents have never been used to paying bills, and the electricity company, to make the investment, needs an income stream that they just can't provide."

I notice that we're being shadowed by two soldiers, in camouflage and with assault rifles, on motorbikes. "That's because of the New People's Army. Guerrilla activity is what made them abandon this place for ten years."

Deep in the jungle? "No, just up there on the hill." Monchet waves his finger in the general direction of the landscape, which suddenly looks a lot like the treeline in the opening credits of Apocalypse Now.

Ruben Petrache was one of those who moved here from the Estero de Paco. He is in his fifties and has been seriously ill. His home is a spacious terraced hut. It has a tin roof, tinfoil in­sulation to keep the heat down, a pretty garden and a "mezzanine" arrangement that creates two bedrooms, such as you would see in a loft. Ruben's English is not so good, so Monchet translates: "What he's saying is that although the community is disrupted, he thinks it's better here. For him, at least. Once you get here, after a while, you realise that you'd become accustomed to conditions that were insanitary. You learn to move on, live in a new way."

For electricity, he points to the solar panel; for water, to the barrel collecting rainwater on his porch. Are there any downsides?

“It would be better if there was a factory here, because we need more jobs," Monchet summarises. Later, with a translator, I work out what Ruben, hand-picked by the camp's authorities, was trying to say: "What the people need is a job. We need a company nearby so that we don't have to go to Manila. Also, we need electricity. Many residents here know how to fix electric fans, radios, but the problem is, even if they have the skills, they cannot [use] it because there is no electricity here - so they are forced to go to Manila to find work and earn money to buy food.

“We are hard workers. If we don't do anything, we might die of hunger here. That's why many go back to Manila: to look for work and earn money."
In the covered market, the stalls are stocked with meat, rice and vegetables but there are more stallholders than shoppers. Gloria Cruz, a 38-year-old mother, is holding forth on a kara­oke machine to three toddlers, two other mums, the ArmaLite-toting soldiers and me. After a couple of verses, she hits the pause button. "My husband goes to Manila to work," she says. "He comes back at weekends. It's the same for everybody. There's nothing here."

Felino Palafox is an architect who specialises in the construction of vast, space-age projects in the Middle East and Asia - mosques, Buddhist temples, futuristic towers on the Persian Gulf - always for people with money to burn.

Now, however, he wants to save the Estero de San Miguel: to rebuild it, in situ, with new materials. The plan is to clear it bit by bit and put inmodular housing. Each plot will be ten square metres; the ground floor will be reserved for retail and tricycle parking, the floors above extending out above the walkway, just as slum-dwellers build their homes - "stealing the air from the planning authorities", Palafox calls it. "The slum-dwellers," he adds, "are experts at live-work space design. They spontaneously do mixed-use! We just have to learn from them."

From the roof of the tower block in Makati, the central business district, where his practice has its headquarters, he gives me a primer in what has gone wrong. He indicates the neighbouring tower blocks - "monuments to graft" - and the gated compounds downtown where the rich live. To the government, which says his design is too expensive, he says: "OK, the total cost of rehousing slum-dwellers in situ is 30 per cent of GDP [but] I calculate we lose about 30 per cent of the country's wealth through corruption. If we didn't have corruption, we wouldn't need to tolerate slums." He sees the Estero de San Miguel as a test case: if he can make it work there, it's scalable to each of the city's riverside slums. So the stakes are huge.

Father Norberto Carcellar, who has worked for much of his life with Manila's poor, thinks that the elite are engaged in a huge self-deception about the question of slum clearance: "We have to recognise the value of slum-dwellers to the city. These are the ones who drive your car, clean your house and run your store. If these people were cleared from the city, the city would die. Slum-dwellers add social, political and economic value to the city."

That sentiment would have seemed alien to our grandparents' generation: I can still hear mine, brought up in Edwardian poverty in a coal and cotton town in northern England, spitting out the word "slum" with disgust. For them, slums meant a dog-eat-dog, dirty world where solidarity could not flourish and people lived like animals and treated their kids worse. Thirty years of globalisation have produced something which defies that stereotype. With Mena at my side, I'm about to witness it.

As it is Saturday night, there is a full complement of beefy guys with sticks, rice flails and flashlights - the volunteer police force of the Estero de San Miguel. Mena and I turn off into an alleyway opposite a McDonald's. You would hardly know it's there. The passage narrows, jinks around, and suddenly it feels as if I am in a novel by Charles Dickens.

On a bridge that is less than a metre wide, a man is squatting beside a barbecue. Because of the smoke, I don't see that it is a bridge until
I'm on it, or that below us is the canal, which is about two metres wide here. The dwellings are built so close together that the mothers peering out of the upstairs bedrooms, made of wooden boxes, could shake their neighbours' hands. If you'd decided to remake Oliver Twist as an expressionist film and this was the proposed set design, you would probably sack the designer, saying: "It's too much, too grotesque."

We head down into the tunnel, stooping now, because it is less than five feet high. After passing a poker game and a stray chicken, I come to a store that is run by Agnes Cabagauan. It sells the same things as every slum store in the world: sachets of Silvikrin hair product, Cif, Head & Shoulders shampoo, the Filipino version of Marlboro cigarettes, lighters, tampons and chewing gum. "My parents helped me set up [the store] to pay for my education," Agnes tells me.

What are you studying?

“Business admin. I have a degree. I also have a day job in a large corporation - coding in a sales department."

And you live here? "Yes. I was born here." She is 22 years old.

Then we run into Mena's son; he's an engineering student. As we cross another bridge, the unmistakable whizz and pop of something digital come blasting across the stagnant water. It's an internet café. There are nine computers crammed into a plywood hut. A dog yaps and runs around; the light is harsh. Some kids are on Facebook. Others are playing online poker. One young woman is doing her CV, another is engrossed in a game called Audition. She, too, is at college, she tells me, multitasking between her BlackBerry and the game.

Business admin? Yup.

In the space of a hundred yards, I have encountered three graduates, a DIY police force and the social media revolution. As I become used to the smoke, the wail and chatter of children, the chickens and the confined space, I learn what a billion people have had to learn: it's not so bad. "Other places have prostitution. We don't," Mena says. "We get drunks and a bit of drug-taking but it's under control. We look out for each other. We can see everything that happens - it's one big family. The main job for the volunteer police force is to look out for arsonists. Settlements under threat of clearance have a habit of getting burned down." As she discourses on the fine details of social policy in the five-foot-high niche that is her living room and kitchen, I ask the question I should have posed when we first met. How did she become so politically literate?

“I majored in political science at the University of Manila."

What slum-dwellers have produced (and I've seen it not just here but in Cairo, Nairobi, Lima and La Paz) is something the slum clearance tsars of yesteryear would not recognise - the orderly, solidaristic slum, or what the UN calls the "slum of hope".

The debate, at the global level, is no longer about how fast to tear these places down but whether we can meet the rapidly developing aspirations of highly educated people in tin shacks. To those who dream that, as capitalism develops, it will eradicate slums, Sinclair of Architecture for Humanity says dream on. "You can't fight something that has a stronger model than you [do]. It's never going to happen again. The fact of it is that if you tried to do it in some of these informal settlements, they could take out the city . . . march on the central business district, and it's game over."

Paul Mason reports from Manila on Tuesday 16 August in "Slums 101" (Radio 4, 8pm) and on "Newsnight" (BBC2, 10.30pm).

This article first appeared in the 08 August 2011 issue of the New Statesman, Slum rule

Picture: Archives Charmet / Bridgeman Images
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What Marx got right

...and what he got wrong.

1. You’re probably a capitalist – among other things

Are you a capitalist? The first question to ask is: do you own shares? Even if you don’t own any directly (about half of Americans do but the proportion is far lower in most other countries) you may have a pension that is at least partly invested in the stock market; or you’ll have savings in a bank.

So you have some financial wealth: that is, you own capital. Equally, you are probably also a worker, or are dependent directly or indirectly on a worker’s salary; and you’re a consumer. Unless you live in an autonomous, self-sufficient commune – very unusual – you are likely to be a full participant in the capitalist system.

We interact with capitalism in multiple ways, by no means all economic. And this accounts for the conflicted relationship that most of us (including me) have with capitalism. Typically, we neither love it nor hate it, but we definitely live it.

2. Property rights are fundamental to capitalism . . . but they are not absolute

If owning something means having the right to do what you want with it, property rights are rarely unconstrained. I am free to buy any car I want – so long as it meets European pollution standards and is legally insured; and I can drive it anywhere I want, at least on public roads, as long as I have a driver’s licence and keep to the speed limit. If I no longer want the car, I can’t just dump it: I have to dispose of it in an approved manner. It’s mine, not yours or the state’s, and the state will protect my rights over it. But – generally for good reason – how I can use it is quite tightly constrained.

This web of rules and constraints, which both defines and restricts property rights, is characteristic of a complex economy and society. Most capitalist societies attempt to resolve these tensions in part by imposing restrictions, constitutional or political, on arbitrary or confiscatory actions by governments that “interfere” with property rights. But the idea that property rights are absolute is not philosophically or practically coherent in a modern society.

3. What Marx got right about capitalism

Marx had two fundamental insights. The first was the importance of economic forces in shaping human society. For Marx, it was the “mode of production” – how labour and capital were combined, and under what rules – that explained more or less everything about society, from politics to culture. So, as modes of production change, so too does society. And he correctly concluded that industrialisation and capitalism would lead to profound changes in the nature of society, affecting everything from the political system to morality.

The second insight was the dynamic nature of capitalism in its own right. Marx understood that capitalism could not be static: given the pursuit of profit in a competitive economy, there would be constant pressure to increase the capital stock and improve productivity. This in turn would lead to labour-saving, or capital-intensive, technological change.

Putting these two insights together gives a picture of capitalism as a radical force. Such are its own internal dynamics that the economy is constantly evolving, and this in turn results in changes in the wider society.

4. And what he got wrong . . .

Though Marx was correct that competition would lead the owners of capital to invest in productivity-enhancing and labour-saving machinery, he was wrong that this would lead to wages being driven down to subsistence level, as had largely been the case under feudalism. Classical economics, which argued that new, higher-productivity jobs would emerge, and that workers would see their wages rise more or less in line with productivity, got this one right. And so, in turn, Marx’s most important prediction – that an inevitable conflict between workers and capitalists would lead ultimately to the victory of the former and the end of capitalism – was wrong.

Marx was right that as the number of industrial workers rose, they would demand their share of the wealth; and that, in contrast to the situation under feudalism, their number and geographical concentration in factories and cities would make it impossible to deny these demands indefinitely. But thanks to increased productivity, workers’ demands in most advanced capitalist economies could be satisfied without the system collapsing. So far, it seems that increased productivity, increased wages and increased consumption go hand in hand, not only in individual countries but worldwide.

5. All societies are unequal. But some are more unequal than others

In the late 19th and early 20th centuries, an increasing proportion of an economy’s output was captured by a small class of capitalists who owned and controlled the means of production. Not only did this trend stop in the 20th century, it was sharply reversed. Inherited fortunes, often dating back to the pre-industrial era, were eroded by taxes and inflation, and some were destroyed by the Great Depression. Most of all, after the Second World War the welfare state redistributed income and wealth within the framework of a capitalist economy.

Inequality rose again after the mid-1970s. Under Margaret Thatcher and Ronald Reagan, the welfare state was cut back. Tax and social security systems became less progressive. Deregulation, the decline of heavy industry and reduction of trade union power increased the wage differential between workers. Globally the chief story of the past quarter-century has been the rise of the “middle class”: people in emerging economies who have incomes of up to $5,000 a year. But at the same time lower-income groups in richer countries have done badly.

Should we now worry about inequality within countries, or within the world as a whole? And how much does an increasing concentration of income and wealth among a small number of people – and the consequent distortions of the political system – matter when set against the rapid ­income growth for large numbers of people in the emerging economies?

Growing inequality is not an inevitable consequence of capitalism. But, unchecked, it could do severe economic damage. The question is whether our political systems, national and global, are up to the challenge.

6. China’s road to capitalism is unique

The day after Margaret Thatcher died, I said on Radio 4’s Today programme: “In 1979, a quarter of a century ago, a politician came to power with a radical agenda of market-oriented reform; a plan to reduce state control and release the country’s pent-up economic dynamism. That changed the world, and we’re still feeling the impact. His name, of course, was Deng Xiaoping.”

The transition from state to market in China kick-started the move towards truly globalised capitalism. But the Chinese road to capitalism has been unique. First agriculture was liberalised, then entrepreneurs were allowed to set up small businesses, while at the same time state-owned enterprises reduced their workforces; yet there has been no free-for-all, either for labour or for capital. The movement of workers from rural to urban areas, and from large, unproductive, state-owned enterprises to more productive private businesses, though vast, has been controlled. Access to capital still remains largely under state control. Moreover, though its programme is not exactly “Keynesian”, China has used all the tools of macroeconomic management to keep growth high and relatively stable.

That means China is still far from a “normal” capitalist economy. The two main engines of growth have been investment and the movement of labour from the countryside to the cities. This in itself was enough, because China had so much catching-up to do. However, if the Chinese are to close the huge gap between themselves and the advanced economies, more growth will need to come from innovation and technological progress. No one doubts that China has the human resources to deliver this, but its system will have to change.

7. How much is enough?

The human instinct to improve our material position is deeply rooted: control over resources, especially food and shelter, made early human beings more able to reproduce. That is intrinsic to capitalism; the desire to acquire income and wealth motivates individuals to work, save, invent and invest. As Adam Smith showed, this benefits us all. But if we can produce more than enough for everybody, what will motivate people? Growth would stop. Not that this would necessarily be a bad thing: yet our economy and society would be very different.

Although we are at least twice as rich as we were half a century ago, the urge to consume more seems no less strong. Relative incomes matter. We compare ourselves not to our impoverished ancestors but to other people in similar situations: we strive to “keep up with the Joneses”. The Daily Telegraph once described a London couple earning £190,000 per year (in the top 0.1 per cent of world income) as follows: “The pair are worried about becoming financially broken as the sheer cost of middle-class life in London means they are stretched to the brink.” Talk about First World problems.

Is there any limit? Those who don’t like the excesses of consumerism might hope that as our material needs are satisfied, we will worry less about keeping up with the Joneses and more about our satisfaction and enjoyment of non-material things. It is equally possible, of course, that we’ll just spend more time keeping up with the Kardashians instead . . .

8. No more boom and bust

Are financial crises and their economic consequences part of the natural (capitalist) order of things? Politicians and economists prefer to think otherwise. No longer does anyone believe that “light-touch” regulation of the banking sector is enough. New rules have been introduced, designed to restrict leverage and ensure that failure in one or two financial institutions does not lead to systemic failure. Many would prefer a more wholesale approach to reining in the financial system; this would have gained the approval of Keynes, who thought that while finance was necessary, its role in capitalism should be strictly limited.

But maybe there is a more fundamental problem: that recurrent crises are baked into the system. The “financial instability” hypothesis says that the more governments and regulators stabilise the system, the more this will breed overconfidence, leading to more debt and higher leverage. And sooner or later the music stops. If that is the case, then financial capitalism plus human nature equals inevitable financial crises; and we should make sure that we have better contingency plans next time round.

9. Will robots take our jobs?

With increasing mechanisation (from factories to supermarket checkouts) and computerisation (from call centres to tax returns), is it becoming difficult for human beings to make or produce anything at less cost than a machine can?

Not yet – more Britons have jobs than at any other point in history. That we can produce more food and manufactured products with fewer people means that we are richer overall, leaving us to do other things, from economic research to performance art to professional football.

However, the big worry is that automation could shift the balance of power between capital and labour in favour of the former. Workers would still work; but many or most would be in relatively low-value, peripheral jobs, not central to the functioning of the economy and not particularly well paid. Either the distribution of income and wealth would widen further, or society would rely more on welfare payments and charity to reduce unacceptable disparities between the top and the bottom.

That is a dismal prospect. Yet these broader economic forces pushing against the interests of workers will not, on their own, determine the course of history. The Luddites were doomed to fail; but their successors – trade unionists who sought to improve working conditions and Chartists who demanded the vote so that they could restructure the economy and the state – mostly succeeded. The test will be whether our political and social institutions are up to the challenge.

10. What’s the alternative?

There is no viable economic alternative to capitalism at the moment but that does not mean one won’t emerge. It is economics that determines the nature of our society, and we are at the beginning of a profound set of economic changes, based on three critical developments.

Physical human input into production will become increasingly rare as robots take over. Thanks to advances in computing power and artificial intelligence, much of the analytic work that we now do in the workplace will be carried out by machines. And an increasing ability to manipulate our own genes will extend our lifespan and allow us to determine our offspring’s characteristics.

Control over “software” – information, data, and how it is stored, processed and manipulated – will be more important than control over physical capital, buildings and machines. The defining characteristic of the economy and society will be how that software is produced, owned and commanded: by the state, by individuals, by corporations, or in some way as yet undefined.

These developments will allow us, if we choose, to end poverty and expand our horizons, both materially and intellectually. But they could also lead to growing inequality, with the levers of the new economy controlled by a corporate and moneyed elite. As an optimist, I hope for the former. Yet just as it wasn’t the “free market” or individual capitalists who freed the slaves, gave votes to women and created the welfare state, it will be the collective efforts of us all that will enable humanity to turn economic advances into social progress. 

Jonathan Portes's most recent book is “50 Ideas You Really Need to Know: Capitalism” (Quercus)

Jonathan Portes is senior fellow The UK in a Changing Europe and Professor of Economics and Public Policy, King’s College London.

This article first appeared in the 22 June 2017 issue of the New Statesman, The zombie PM

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