Top line: East Coast is Britain's best-run railway company. Photo: Bloomberg/Getty
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Leviathan’s revenge: how Britain belongs to someone else

James Meek’s superb new book exposes the perversities, hypocrisies and failures of privatisation.

Private Island: Why Britain Now Belongs to Someone Else 
James Meek
Verso, 238pp, £12.99

Thatcherism professed defiance against both the state and Europe: what a supreme irony, then, that its legacy involves the handing over of British utilities to nationalised European companies. It promised to forge a property-owning, share-owning democracy to build a new era of popular capitalism. Yet where about 40 per cent of British shares were held by individuals in 1981, the proportion had collapsed to less than 12 per cent by the time Margaret Thatcher was booted out of office. “We have not successfully rolled back the frontiers of the state in Britain, only to see them reimposed at a European level,” Thatcher famously said at Bruges in 1988. Less well-publicised is how – that same year – she flaunted to a group of business people the success of her administration in forcing the European Economic Community to remove obstacles to cross-border business. And so Britain’s electricity is now provided by the likes of France’s state-run EDF. The British state has been rolled back in favour of the French state.

James Meek’s superb book exposes the perversities, hypocrisies and failures of privatisation. Meek is a writer of fiction as well as a journalist, and it shows: he crafts beautiful and vivid passages that turn what could be a dry subject into a highly readable study. It is well timed, too. Our political elite treat privatisation as an article of faith, and dismiss its opponents as discredited dinosaurs who belong in a 1970s dystopia of rubbish piling up in the streets and a leviathan state throttling individual enterprise. But privatisation never did win the hearts of the British people. According to opinion polls, large majorities support public ownership of the privatised utilities – and that includes either majorities or pluralities of Ukip and Conservative voters. An open door is there to be pushed, and Meek is part of a growing literary counter-assault against neoliberals, who argue for the privatisation of public assets, reduction of taxes on wealthy individuals and corporate interests, and for the state to promote supposedly “free” markets.

Meek engages very impressively with the intellectual defences of neoliberalism to critique and undermine them more effectively. Privatisation would force subsidy-hogging, overmanned and technologically backward monoliths to become efficient, lean and forward-facing. They would be forced to compete, and if they failed to offer an adequate service they would be driven to bankruptcy. Yes, workers would lose their jobs, but they would become proto-Alan Sugar entrepreneurs, or find other work. “Everyone would win, except the lazy, and Arthur Scargill,” as Meek puts it. He considers the experience of the collapse of the Soviet bloc, which he experienced: in the initial period of capitalist restoration, he even wondered whether he was suffering from a creeping dose of Thatcherism. But post-Soviet Russia suffered one of the worst falls in living standards of any peacetime industrialised nation, and roughly a decade was sliced off the life expectancy of its men.

Each chapter – though admittedly rather self-contained – exposes the failures of a wave of privatisation with a mixture of reportage, interviews and facts. The railways are probably the most striking instance: subsidised by the taxpayer, their upgrading and technological development underwritten by the state, they were left fragmented and inefficient (though Meek doesn’t mention it, the publicly run East Coast line was found to be Britain’s most efficient rail franchise). Elsewhere, water companies paid £1bn in dividends to shareholders between 2009 and 2013 instead of investing in their infrastructure. The electricity companies invented a system for setting their wholesale prices that only they understood, finding ways of manipulating the markets to charge artificially high tariffs even as the cost of energy fell. The Tories built on foundations provided by New Labour and unleashed the privatisation of the NHS while claiming to love it. Then there is the disaster of right-to-buy: soaring social housing waiting lists, a collapse in housebuilding since responsibility was abdicated to the market, and the subsidising of private landlords with the explosion of housing benefit.

What Meek’s book does not do is promote an alternative. There is a collective failure on the part of all of us who oppose neoliberal triumphalism to present coherent alternatives that resonate with people. But in the 1970s, the left did present its own critique of the top-down, bureaucratic forms of nationalisation developed by the postwar Attlee administrations. Instead, it proposed democratic involvement on the part of both workers and service users or consumers. Surely this has to be at the heart of any new wave of public ownership.

Nonetheless, Meek calmly and eloquently administers some welcome right hooks to the prevailing dogma of neoliberalism. The question is whether the new dissidents can learn from the example of the neoliberals themselves: they, too, once languished on the ideological fringes but then they turned their polemics into policies. Economic crisis provided them with an opening, a moment when “the politically impossible becomes politically inevitable”, as Milton Friedman put it. Today’s crisis offers a similar opening. The neoliberal project has failed: but it will never be defeated until it can be replaced by something else. 

Owen Jones’s “The Establishment: and How They Get Away With It” is published by Allen Lane (£16.99)

Owen Jones is a left-wing columnist, author and commentator. He is a contributing writer to the New Statesman and writes a weekly column for the Guardian. He has published two books, Chavs: the Demonisation of the Working Class and The Establishment and How They Get Away With It.

This article first appeared in the 08 October 2014 issue of the New Statesman, Grayson Perry guest edit

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Find the EU renegotiation demands dull? Me too – but they are important

It's an old trick: smother anything in enough jargon and you can avoid being held accountable for it.

I don’t know about you, but I found the details of Britain’s European Union renegotiation demands quite hard to read. Literally. My eye kept gliding past them, in an endless quest for something more interesting in the paragraph ahead. It was as if the word “subsidiarity” had been smeared in grease. I haven’t felt tedium quite like this since I read The Lord of the Rings and found I slid straight past anything written in italics, reasoning that it was probably another interminable Elvish poem. (“The wind was in his flowing hair/The foam about him shone;/Afar they saw him strong and fair/Go riding like a swan.”)

Anyone who writes about politics encounters this; I call it Subclause Syndrome. Smother anything in enough jargon, whirr enough footnotes into the air, and you have a very effective shield for protecting yourself from accountability – better even than gutting the Freedom of Information laws, although the government seems quite keen on that, too. No wonder so much of our political conversation ends up being about personality: if we can’t hope to master all the technicalities, the next best thing is to trust the person to whom we have delegated that job.

Anyway, after 15 cups of coffee, three ice-bucket challenges and a bottle of poppers I borrowed from a Tory MP, I finally made it through. I didn’t feel much more enlightened, though, because there were notable omissions – no mention, thankfully, of rolling back employment protections – and elsewhere there was a touching faith in the power of adding “language” to official documents.

One thing did stand out, however. For months, we have been told that it is a terrible problem that migrants from Europe are sending child benefit to their families back home. In future, the amount that can be claimed will start at zero and it will reach full whack only after four years of working in Britain. Even better, to reduce the alleged “pull factor” of our generous in-work benefits regime, the child benefit rate will be paid on a ratio calculated according to average wages in the home country.

What a waste of time. At the moment, only £30m in child benefit is sent out of the country each year: quite a large sum if you’re doing a whip round for a retirement gift for a colleague, but basically a rounding error in the Department for Work and Pensions budget.

Only 20,000 workers, and 34,000 children, are involved. And yet, apparently, this makes it worth introducing 28 different rates of child benefit to be administered by the DWP. We are given to understand that Iain Duncan Smith thinks this is barmy – and this is a man optimistic enough about his department’s computer systems to predict in 2013 that 4.46 million people would be claiming Universal Credit by now*.

David Cameron’s renegotiation package was comprised exclusively of what Doctor Who fans call handwavium – a magic substance with no obvious physical attributes, which nonetheless helpfully advances the plot. In this case, the renegotiation covers up the fact that the Prime Minister always wanted to argue to stay in Europe, but needed a handy fig leaf to do so.

Brace yourself for a sentence you might not read again in the New Statesman, but this makes me feel sorry for Chris Grayling. He and other Outers in the cabinet have to wait at least two weeks for Cameron to get the demands signed off; all the while, Cameron can subtly make the case for staying in Europe, while they are bound to keep quiet because of collective responsibility.

When that stricture lifts, the high-ranking Eurosceptics will at last be free to make the case they have been sitting on for years. I have three strong beliefs about what will happen next. First, that everyone confidently predicting a paralysing civil war in the Tory ranks is doing so more in hope than expectation. Some on the left feel that if Labour is going to be divided over Trident, it is only fair that the Tories be split down the middle, too. They forget that power, and patronage, are strong solvents: there has already been much muttering about low-level blackmail from the high command, with MPs warned about the dire influence of disloyalty on their career prospects.

Second, the Europe campaign will feature large doses of both sides solemnly advising the other that they need to make “a positive case”. This will be roundly ignored. The Remain team will run a fear campaign based on job losses, access to the single market and “losing our seat at the table”; Leave will run a fear campaign based on the steady advance of whatever collective noun for migrants sounds just the right side of racist. (Current favourite: “hordes”.)

Third, the number of Britons making a decision based on a complete understanding of the renegotiation, and the future terms of our membership, will be vanishingly small. It is simply impossible to read about subsidiarity for more than an hour without lapsing into a coma.

Yet, funnily enough, this isn’t necessarily a bad thing. Just as the absurd complexity of policy frees us to talk instead about character, so the onset of Subclause Syndrome in the EU debate will allow us to ask ourselves a more profound, defining question: what kind of country do we want Britain to be? Polling suggests that very few of us see ourselves as “European” rather than Scottish, or British, but are we a country that feels open and looks outwards, or one that thinks this is the best it’s going to get, and we need to protect what we have? That’s more vital than any subclause. l

* For those of you keeping score at home, Universal Credit is now allegedly going to be implemented by 2021. Incidentally, George Osborne has recently discovered that it’s a great source of handwavium; tax credit cuts have been postponed because UC will render such huge savings that they aren’t needed.

Helen Lewis is deputy editor of the New Statesman. She has presented BBC Radio 4’s Week in Westminster and is a regular panellist on BBC1’s Sunday Politics.

This article first appeared in the 11 February 2016 issue of the New Statesman, The legacy of Europe's worst battle