Thinker's Corner

An Economists' Manifesto on Unemployment in the European Union (BNL Quarterly Review Sept 98 - contact Dennis Snower, Birkbeck College, 7-15 Gresse St, London W1P 2LL). As Europe is poised to abandon pure monetarism, this manifesto proposes a policy prescription designed to slash unemployment by 4 to 5 per cent in a matter of years. This can be accomplished by an active state that simultaneously pursues demand and supply-side policies. Calls to restrain unions, overhaul social security systems (notably sickness and unemployment benefits) and keep minimum wages modest will please Blairites, even more so because the authors deem them the proper domain of national governments. Others will seize on the plea for a concerted European push towards lower interest rates, plus new infrastructure projects to kick-start the economy, financed by borrowing. A hotchpotch of conflicting philosophies or an inspired balancing act? Maybe a bit of both, as the authors might say.

Stakeholding - Betraying the corporation's objectives (Social Affairs Unit, Morley House, Regent Street, London W1R 5AB, £6). Elaine Sternberg has squandered an opportunity to make a credible contribution to the current debate. She paints stakeholder theory in the most ludicrous colours at the expense of factual evidence. Stakeholding is alternatively a "parasite" ravishing the body of business or a Trojan-horse attempt to sabotage companies. If it prevails, we can kiss both wealth-creation and property rights good-bye. Sternberg proposes a return to pure shareholder-value and the nightwatchman state. What is more disappointing, though, is that the report fails to attack the crucial question head-on: what is it about stakeholding that makes it palatable even to the CBI? In other words, what is it about Thatcherite thought that even business won't listen to it any more? The answer to that question may lie in this depressing booklet.

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This article first appeared in the 13 November 1998 issue of the New Statesman, Why gays become politicians