We love capitalism

Were trade unionists looking in the wrong place when they fought for better pay and shorter hours? T

Karl Marx famously predicted that capitalism would produce its own gravediggers. If so, they have been an awfully long time on the job. (Perhaps they knock off early.) In fact, there is no grave. Capitalism is alive and well, having triumphed on all fronts: economic, social and political. Like democracy, it has proved to be the worst way to run an economy - with the exception of all the others. Yet it seems unlikely that in a hundred years there will be any general need for the word capitalism at all. The only sixth-formers writing essays on "capitalism" or "socialism" in 2107 will be those studying history.

As a result of this total victory, the market economy has been depoliticised. If anything, it is Labour ministers who now make the case for capitalism - for productivity, competitiveness and growth - and new Conservatives who point to the "social irresponsibility" of a selection of companies. When Rover finally went under in 2005, victim of the scouring forces of global capitalism, the national response was a collective shrug. We are all, it seems, capitalists now.

But what species of capitalist do we want to be? Where markets have proved triumphant is in their ability to drive up living standards and personal choice through rising productivity. And yet, as John Maynard Keynes presciently warned in 1930, this solving of "the economic problem" still leaves mankind with his "real [and] permanent problem - how to use his freedom from pressing economic cares . . . which science and compound interest will have won for him, to live wisely and agreeably and well".

Solving this problem means rethinking the essence of each individual's relationship to the labour market. Capitalism is triumphant but complacent - to reform it, we have to go into the belly of the beast.

There are mountains of data being produced which show us what the Beatles and Aristotle instinctively knew: that higher levels of wealth and consumption have a limited, and diminishing, impact on our sense of well-being. Politicians are trading terms such as "general well-being" and "quality of life" because there is a grow- ing awareness of the costs as well as the benefits of consumer-driven growth - the malaise that the psychologist Oliver James calls "affluenza".

The prescriptions for the disease are to "simplify" our lives, consume less, address our "work-life balance" and meditate. There is even a gentle man giving out free hugs. At a policy level, higher income tax is sometimes proposed (presumably because those days of supertax in the 1970s were so euphoric), along with longer holidays and state-mandated limits on working hours. These are mostly well and good. But they skirt around the central issue (and here Marx was at his most acute): the relationship between the individual and his or her work. Purposeful, rewarding work is at the heart of a well-lived life. This is why Gordon Brown has called for "full and fulfilling" employment and why David Cameron - a decade later - supports a "modern vision of ethical work" as part of a drive towards "general well-being". There is a strong, consistent link between job satisfaction and overall happiness. Work is where economics becomes human, where the connection between the creation of wealth and cultivation of well-being is strongest.

Work is also the site at which the skills and effort of the individual are transformed into something the number-crunchers at the Office for National Statistics can measure and call GDP. Right now, in the UK at least, we are not doing too well on this score. The most important component of overall productivity today is labour productivity - in other words, what people actually do (or fail to do) at their workplace each day.

The problem that companies face is how to motivate people to "go the extra mile": to give the firm more creativity, energy or time than is required under the terms of their contract. In the management literature, this is labelled "discretionary effort". But it is much more than an issue for managers. It goes to the heart of the particular model of a market economy that is and has been in vogue for the past century or so, one that is based on people working for a firm owned by other people, to whom most additional profit flows. As the other Marx (Groucho) put it: "What makes wage slaves? Wages!"

There is a solution to both problems, a remedy that will raise levels of well-being and boost productivity. It is, in that incalculably misused phrase, a "win-win". The solution is this: for the people who work in an enterprise to have a real financial stake in its long-term performance. Firms in which the employees are also the "co-owners" are more productive, with more engaged employees. They account for no less than £20bn worth of turnover - roughly 2 per cent of the UK economy - and cover such diverse sectors as retail (John Lewis), civil engineering (Arup) and advertising (St Luke's). In the mid-1990s, Labour flirted briefly with the idea of a "stakeholder" society, then being articulated by Will Hutton, but backed off once the top brass realised that it would entail taming the capital markets. The essential insight of stakeholding was right, but the place to start is in the firm itself, not the market as a whole.

Most policy-makers view the co-ownership sector in the same way as the royal family: a good thing, slightly anachronistic . . . and a bit wet. But firms where workers not only own a real stake but also play a real role in running the firm - where the co-owners are also co-creators - are not for the soft-hearted. These are not reheated co-operatives: pay differentials tend to be lower than in comparable firms, but there is no expectation that everyone will get a same-sized slice of the pie. One of the sources of higher productivity in these "CoCo" companies is tougher peer policing: it is harder to "pull a sickie" when the co-workers who "welcome" you back will be poorer as a result. Information-sharing and innovation levels look to be higher in CoCo firms.

Latter-day pirates

The best study undertaken of relative performance suggests a 19 per cent productivity lift from co-ownership. Applied across the economy, co-ownership would make the UK the most productive nation in the world. In a survey of managers in co-owner firms, 72 per cent reported that staff worked harder than in competitor companies, and 81 per cent that they took on more responsibility. And CoCo firms should not be tarred with the brush of being an example of "corporate social responsibility". They are only as responsible or irresponsible as their owners, just like with any other firm.

CoCo enterprises should be the next-generation capitalist business model. A new organisation, the Employee Ownership Association, will start a campaign this month to raise political and public awareness. The timing is auspicious: the public limited company, until now the mainstay of capitalism, is in some danger from private equity firms (at this very moment, a ravenous group is circling Sainsbury's). It might be possible to throw a few legislative or regulatory obstacles in the path of these latter-day pirates. But the whole point of a public limited company is that its stock is publicly traded. If a private equity firm offers my pension fund a great price for its stocks in Sainsbury's, the fund might well be obliged to accept it. Most CoCo firms, however, are impregnable to outside raiders: the stock has to remain in the hands of employees. It is also easier, in such firms, to take longer-term decisions without too much fear of the impact on short-term share prices.

John Lewis is flying high, but had some years of retrenchment and reinvestment in the 1990s when its headline profit numbers were weak. "If we had been a plc, you could write a script that we would have been under severe scrutiny in those years," says the firm's personnel director, Andy Street. "But our structure allows us to operate on slightly different timescales."

As a business model co-ownership seems hard to beat. Yet if this was the end of the argument, it would be hard to get very excited. After all, productivity per se is scarcely relevant: what counts is how it is arrived at. But CoCo capitalism has other advantages, in its human engagement with work and an increased sense of citizenship that spills over into life outside work. For one thing, it seems that co-owned firms are less likely to award vast salaries to their chief executives, and may act as a brake on runaway wage inequality.

John Stuart Mill, a passionate advocate for co-ownership, argued in the 19th century that the benefits included "the healing of the standing feud between capital and labour; the transformation of human life, from a conflict of classes struggling for opposite interests, to a friendly riv alry in the pursuit of a common good to all; the elevation of the dignity of labour; a new sense of security and independence in the labouring class; and the conversion of each human being's daily occupation into a school of the social sympathies and the practical intelligence".

Given that the "feud" between capital and labour is the raison d'être of the trade unions, co-ownership is not necessarily good news for them. Even in the "corporatist", German-style version of capitalism, the underlying assumption is that labour and capital have differing interests, which have to be balanced peaceably and fairly. Under co-ownership, the distinction implodes. And it was certainly Mill's view that giving "the whole body of workpeople . . . a direct interest" in the profits of the enterprise would bring about "the true euthanasia of Trades Unionism".

Yet a move towards a different sort of capitalism poses challenges to political orthodoxy, too. Despite capitalism's victory, there is a resistance to looking with a clear eye at its flaws; there is still a timidity about questioning the current version of capitalism for fear of being branded a barricade-building red. But surely, it must now be possible to have a conversation about the kind of economy we want: after all, young people born after the fall of the Berlin Wall are reaching voting age.

There are certain policies that might help with the cultivation of co-ownership, from changes in tax treatment to better data collection and the provision of advice. However, the argument has to be won first. For the left, this requires a significant shift in focus. The primary locus of political attention in the past half-century has been on the state and its relationship to the individual. Taxation, regulation, redistribution and public services are the staple diet of Labour types. The fruits of this philosophy, especially the welfare state, are obvious and real, but the party has to start living up to its name again.

The central social and economic issue of our time is the relationship of individuals not to the state, but to the organisation for which they labour. Co-ownership could be seen, using the old labels, as socialism without the state, yet it could equally be seen as capitalism with more capitalists. The point is that it doesn't matter. What should concern us now is whether existing structures and cultures are enabling us to live "wisely, agreeably and well" and, if not, what we might do about it.

CoCo Companies is published by the Employee Ownership Association (http://www.employeeownership.co.uk)

This article first appeared in the 19 February 2007 issue of the New Statesman, Iran - Ready to attack

RALPH STEADMAN
Show Hide image

The age of outrage

Why are we so quick to take offence? The Private Eye editor on Orwell, Trump and the death of debate in post-truth politics.

Anyone who thinks that “post-truth politics” is anything new needs to be reminded that George Orwell was writing about this phenomenon 70 years before Donald Trump.

Audiences listening to President-Elect Trump’s extraordinary disregard for anything resembling objective truth – and his astonishing ability to proclaim the absolute opposite today of what he said yesterday – will be forcibly reminded of the slogans that George Orwell gave to his political ­dictators: Black is White, War is Peace, ­Freedom is Slavery, Ignorance is Strength (the last of which turned out to be true in the US election). But any journalist trying to work out what the speeches actually mean, amidst the mad syntax and all the repetition (“gonna happen, gonna happen”), cannot help but fall back on Orwell’s contention that “political chaos is connected with the decay of language”. And the sight of Trump praising Secretary Clinton for her years of public service in his post-election victory speech while the crowd was still chanting his campaign catchphrase of “Lock her up” was surely a perfect example of Doublethink.

No wonder Trump is an admirer of Vladimir Putin, who is an admirer of the Soviet strongmen whom Orwell satirised so well. These echoes from the past are very strong in America at present but there are plenty of them reverberating through British and European politics as well. Our Foreign Secretary managed to accuse other European leaders of a “whinge-o-rama” when they issued qualified statements of congratulation to the new president-elect, even though he himself had previously accused Trump of being “nuts”. Black is White, Remain is Leave, a Wall is a Fence, two plus two equals five: but Brexit means Brexit.

You may find this reassuring, in that we have been here before and survived – or distressing to think that we are regressing to a grimmer Orwellian age. But one of the worrying developments attached to these “post-truth” political figures is the increasing intolerance in public debate of dissent – or even disagreement – about what objective truth might be.

A great deal has been written recently about the influence of social media in helping people to become trapped in their own echo chambers, talking only to those who reinforce their views and dismissing not only other opinions, but also facts offered by those who disagree with them. When confronted by a dissenting voice, people get offended and then angry. They do not want to argue, they want the debate to be shut down. Trump supporters are furious with anyone who expresses reservations about their candidate. Pro-Brexit supporters are furious with anyone who expresses doubts about the way the process of leaving the European Union is going.

I edit the magazine Private Eye, which I sometimes think Orwell would have dismissed as “a tuppeny boys’ fortnightly”, and after the recent legal challenge to the government about Article 50 being put before parliament, we published the cover reproduced on page 25.

It was a fairly obvious joke, a variant of the “wheels coming off” gag. But it led to a large postbag of complaints, including a letter from a man who said he thought the cover was “repulsive”. He also said he wanted to come around and smash up the office and then shove our smug opinions so far up our arses that we choked our guts out.

There was one from a vicar, too, who told me that it was time to accept the victory of the majority of the people and to stop complaining. Acceptance was a virtue, he said. I wrote back and told him that this argument was a bit much, coming from a church that had begun with a minority of 12. (Or, on Good Friday, a minority of one.)

This has become a trend in those who complain: the magazine should be shouted down or, better still, closed down. In the light of this it was interesting to read again what Orwell said in his diary long before internet trolls had been invented:

 

We are all drowning in filth. When I talk to anyone or read the writings of anyone who has any axe to grind, I feel that intellectual honesty and balanced judgement have simply disappeared from the face of the earth. Everyone’s thought is forensic, everyone is simply putting a “case” with deliberate suppression of his opponent’s point of view, and, what is more, with complete insensitiveness to any sufferings except those of himself and his friends.

 

This was in 1942, when the arguments were about war and peace, life and death, and there were real fascists and Stalinists around rather than, say, people who disagree with you about the possibility of reconciling freedom of movement with access to the single European market.

Orwell also made clear, in an essay called “As I Please” in Tribune in 1944, that what we think of as the new online tendency to call everyone who disagrees with you a fascist is nothing new. He wrote then:

 

It will be seen that, as used, the word “Fascism” is almost entirely meaningless. In conversation, of course, it is used even more wildly than in print. I have heard it applied to farmers, shopkeepers, Social Credit, corporal punishment, fox-hunting, bull-fighting, the 1922 Committee [a Tory group], the 1941 Committee [a left-liberal group], Kipling, Gandhi, Chiang Kai-Shek, homosexuality, Priestley’s broadcasts, Youth Hostels, astrology, women, dogs and I do not know what else.

 

When Orwell writes like this about the level of public debate, one is unsure whether to feel relieved at the sense of déjà vu or worried about the possibility of history repeating itself, not as farce, but as tragedy again.

The mood and tone of public opinion is an important force in the way our society and our media function. Orwell wrote about this in an essay called “Freedom of the Park”, published in Tribune in December 1945. Five people had been arrested outside Hyde Park for selling pacifist and anarchist publications. Orwell was worried that, though they had been allowed to publish and sell these periodicals throughout the entire Second World War, there had been a shift in public opinion that meant that the police felt confident to arrest these people for “obstruction” and no one seemed to mind this curtailment of freedom of speech except him. He wrote:

 

The relative freedom which we enjoy depends on public opinion. The law is no protection. Governments make laws, but whether they are carried out, and how the police behave, depends on the general temper in the country. If large numbers of people are interested in freedom of speech, there will be freedom of speech, even if the law forbids it; if public opinion is sluggish, inconvenient minorities will be persecuted, even if laws exist to protect them.

 

This is certainly true for the press today, whose reputation in the past few years has swung violently between the lows of phone-hacking and the highs of exposing MPs’ expenses. In 2011 I remember at one point a football crowd shouting out the name of Ryan Giggs, who had a so-called superinjunction in place forbidding anyone to mention that he was cheating on his wife and also forbidding anyone to mention the fact that he had taken out a superinjunction. He was named on Twitter 75,000 times. It seemed clear that public opinion had decided that his private life should be made public. The freedom of the press was briefly popular. Later the same year it was revealed that the murdered schoolgirl Milly Dowler’s phone had been hacked by the News of the World, along with those of a number of high-profile celebrities, and the public decided that actually journalists were all scumbags and the government should get Lord Leveson to sort them out. Those who maintained that the problem was that the existing laws (on trespass, contempt, etc) were not enforced because of an unhealthy relationship between the police, the press and the politicians were not given much credence.

In a proposed preface to his 1945 novel, Animal Farm, Orwell wrote: “If liberty means anything at all, it means the right to tell people what they do not want to hear.”

This is the quotation that will accompany the new statue of Orwell that has now been commissioned by the BBC and which will stand as a sort of rebuke to the corporation whenever it fails to live up to it. The BBC show on which I appear regularly, Have I Got News for You, has been described simultaneously in the online comments section as “overprivileged, right-wing Tory boys sneering at the working class ” and “lefty, metropolitan liberal elite having a Labour luvvie whinge-fest”. Disturbing numbers of complainants feel that making jokes about the new president-elect should not be allowed, since he has won the election. Humour is not meant to be political, assert the would-be censors – unless it attacks the people who lost the vote: then it is impartial and neutral. This role for comedy would have surprised Orwell, who was keen on jokes. He wrote of Charles Dickens:

 

A joke worth laughing at always has an idea behind it, and usually a subversive idea. Dickens is able to go on being funny because he is in revolt against authority, and authority is always there to be laughed at. There is always room for one more custard pie.

 

I think there is also room for a custard pie or two to be thrown against those who claim to be outsiders, against authority and “the system”, and use this as a way to take power. The American billionaire property developer who is the champion of those dispossessed by global capitalism seems a reasonable target for a joke. Just like his British friend, the ex-public-school boy City trader-turned-critic of the Home Counties elite.

The emblematic quotation on liberty is from a preface that was not published until 1972 in the Times Literary Supplement. A preface about freedom of speech that was censored? It is almost too neatly Orwellian to be true, and in fact no one seems to know exactly why it did not appear. Suffice to say that it is fascinating to read Orwell complaining that a novel which we all now assume to be a masterpiece – accurate about the nature of revolution and dictatorship and perfect for teaching to children in schools – was once considered to be unacceptably, offensively satirical.

The target of the satire was deemed to be our wartime allies the Russians. It is difficult to imagine a time, pre-Putin, pre-Cold War, when they were not seen as the enemy. But of course the Trump presidency may change all that. Oceania may not be at war with Eurasia any more. Or it may always have been at war with Eastasia. It is difficult to guess, but in those days the prevailing opinion was that it was “not done” to be rude about the Russians.

Interestingly there is now a significant faction on the British left, allied with the current leader of the Labour Party, who share this view.

 

The right to tell people what they do not want to hear is still the basis of freedom of expression. If that sounds like I am stating the obvious – I am. But, in my defence, Orwell once wrote in a review of a book by Bertrand Russell published in the Adelphi magazine in January 1939:

 

. . . we have now sunk to a depth at which the restatement of the obvious is the first duty of intelligent men.

 

Orwell himself managed to come round to a position of accepting that an author could write well and truthfully about a subject even if one disapproved of the author’s politics: both Kipling and Swift were allowed to be right even though they were not left enough. So I am hoping that we can allow Orwell to be right about the principles of freedom of expression.

In the unpublished preface to Animal Farm he writes:

 

The issue involved here is quite a simple one: Is every opinion, however unpopular – however foolish, even – entitled to a hearing? Put it in that form and nearly any English intellectual will feel that he ought to say “Yes”. But give it a concrete shape, and ask, “How about an attack on Stalin? Is that entitled to a hearing?”, and the answer more often than not will be “No”. In that case the current orthodoxy happens to be challenged, and so the principle of free speech lapses.

 

One can test oneself by substituting contemporary names for Stalin and seeing how you feel. Putin? Assange? Mandela? Obama? Snowden? Hillary Clinton? Angela Merkel? Prince Harry? Mother Teresa? Camila Batmanghelidjh? The Pope? David Bowie? Martin Luther King? The Queen?

Orwell was always confident that the populist response would be in favour of everyone being allowed their own views. That might be different now. If you were to substitute the name “Trump” or “Farage” and ask the question, you might not get such a liberal response. You might get a version of: “Get over it! Suck it up! You lost the vote! What bit of ‘democracy’ do you not understand?”

Orwell quotes from Voltaire (the attribution is now contested): “I detest what you say; I will defend to the death your right to say it.” Most of us would agree with the sentiment, but there is a worrying trend in universities that is filtering through into the media and the rest of society. Wanting a “safe space” in which you do not have to hear views that might upset you and demanding trigger warnings about works of art that might display attitudes which you find offensive are both part of an attempt to redefine as complex and negotiable what Orwell thought was simple and non-negotiable. And this creates problems.

Cartoon: "Voltaire goes to uni", by Russell and originally published in Private Eye.

We ran a guide in Private Eye as to what a formal debate in future universities might look like.

 

The proposer puts forward a motion to the House.

The opposer agrees with the proposer’s motion.

The proposer wholeheartedly agrees that the opposer was right to support the motion.

The opposer agrees that the proposer couldn’t be more right about agreeing that they were both right to support the motion.

When the debate is opened up to the floor, the audience puts it to the proposer and the opposer that it isn’t really a debate if everyone is just agreeing with each other.

The proposer and the opposer immediately agree to call security and have the audience ejected from the debating hall.

And so it goes on, until the motion is carried unanimously.

 

This was dismissed as “sneering” and, inevitably, “fascist” by a number of student commentators. Yet it was only a restatement of something that Orwell wrote in the unpublished preface:

 

. . . everyone shall have the right to say and to print what he believes to be the truth, provided only that it does not harm the rest of the community in some quite unmistakable way. Both capitalist democracy and the western versions of socialism have till recently taken that principle for granted. Our Government, as I have already pointed out, still makes some show of respecting it.

 

This is not always the case nowadays. It is always worth a comparison with the attitudes of other countries that we do not wish to emulate. The EU’s failure to confront President Erdogan’s closure of newspapers and arrests of journalists in Turkey because it wants his help to solve the refugee crisis is one such obvious example. An old German law to prosecute those making fun of foreign leaders was invoked by Erdogan and backed by Mrs Merkel. This led Private Eye to run a competition for Turkish jokes. My favourites were:

 

“Knock knock!”

“Who’s there.”

“The secret police.”

 

What do you call a satirist in Turkey?

An ambulance.

 

As Orwell wrote in even more dangerous times, again in the proposed preface:

 

. . . the chief danger to freedom of thought and speech at this moment is not the direct interference of the [Ministry of Information] or any official body. If publishers and editors exert themselves to keep certain topics out of print, it is not because they are frightened of prosecution but because they are frightened of public opinion.

 

I return to stating the obvious, because it seems to be less and less obvious to some of the current generation. This is particularly true for those who have recently become politically engaged for the first time. Voters energised by Ukip and the EU referendum debate, or by the emergence of Jeremy Corbyn as leader of the Labour Party, or by the resurgence of Scottish nationalism or by the triumph of Trump, have the zeal of the newly converted. This is all very admirable, and a wake-up call to their opponents – the Tartan Tories and the Remoaners and the NeoBlairites and the Washington Liberal Elite – but it is not admirable when it is accompanied by an overpowering desire to silence any criticism of their ideas, policies and leading personalities. Perhaps the supporters of the mainstream parties have simply become accustomed to the idea over the decades, but I have found in Private Eye that there is not much fury from the Tory, New Labour or Liberal camps when their leaders or policies are criticised, often in much harsher ways than the newer, populist movements.

 

 

So, when Private Eye suggested that some of the claims that the Scottish National Party was making for the future of an independent Scotland might be exaggerated, there were one or two readers who quoted Orwell’s distinction between patriotism being the love of one’s country and nationalism being the hatred of others – but on the whole it was mostly: “When if ever will you ignorant pricks on the Eye be sharp enough to burst your smug London bubble?”

Those who disagreed with the SNP were beneath contempt if English and traitors if Scottish. This was matched by the sheer fury of the Corbyn loyalists at coverage of his problems with opposition in his own party. When we suggested that there might be something a bit fishy about his video on the lack of seats on the train to Newcastle, responses included: “I had hoped Private Eye was outside the media matrix. Have you handed over control to Rupert Murdoch?”

Their anger was a match for that of the Ukippers when we briefly ran a strip called At Home With the Ukippers and then made a few jokes about their leader Mr Farage: “Leave it out, will you? Just how much of grant/top up/dole payment do you lot get from the EU anyway? Are you even a British publication?”

In 1948, in an essay in the Socialist Leader, Orwell wrote:

 

Threats to freedom of speech, writing and action, though often trivial in isolation, are cumulative in their effect and, unless checked, lead to a general disrespect for the rights of the citizen.

 

In other words, the defence of freedom of speech and expression is not just special pleading by journalists, writers, commentators and satirists, but a more widespread conviction that it protects “the intellectual liberty which without a doubt has been one of the distinguishing marks of Western civilisation”.

In gloomy times, there was one letter to Private Eye that I found offered some cheer – a willingness to accept opposing viewpoints and some confirmation of a belief in the common sense of Orwell’s common man or woman. In response to the cartoon below, our correspondent wrote:

 

Dear sir,

I suffer from a bipolar condition and when I saw your cartoon I was absolutely disgusted. I looked at it a few days later and thought it was hilarious.

 

Ian Hislop is the editor of Private Eye. This is an edited version of his 2016 Orwell Lecture. For more details, visit: theorwellprize.co.uk

This article first appeared in the 01 December 2016 issue of the New Statesman, Age of outrage