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How the market abandoned morality

We need a renewed critique of capitalism – but is discouraging the lifestyle of educated young people and promoting the “ethical family” really the answer?

Like the lifelong sinner who makes a deathbed conversion, it was always likely that supporters of neoliberal globalisation would rediscover ethics towards the end. Having devastated communities through indifference, and coercively imposed commercial priorities on to family life, the political “centre” now has to deal with anger, distrust and rejection on an unmanageable scale.

In The Future of Capitalism, Paul Collier, a former chief economist at the World Bank, now professor at the Oxford Blavatnik School of Government, attacks the twin ethical systems that have dominated policymaking in the free-market era: utilitarianism and the theories of social justice associated with the political philosopher John Rawls. In their place he outlines a project for the renewal of centrist politics based on communitarian ethics.

The project, which he labels “hard centrism”, is backed by an appeal to patriotism and with a mea culpa from the economics profession. We over-egged the benefits of globalisation, trade, migration and light-touch regulation, and the result is an outbreak of fascism and xenophobia from Charlottesville to Katowice.

If it were coherent, Collier’s solution might place him as the latest in a line of “moral economists”, broadly aligned with the centre left and stretching from RH Tawney in the 1920s, via Karl Polanyi to Edward Thompson, whose evolution is explored in Tim Rogan’s book The Moral Economists. Unfortunately, Collier’s solutions are not coherent, and about as likely to defuse populist anger as a Goldman Sachs away-day.

Collier correctly identifies the symptoms that are driving political radicalisation: the massive inequalities generated by free-market economics; the spatial divide between ex-industrial towns, with their older and less educated workforce, and the buzzing, young cosmopolitan cities; plus the absence of empathy among those who’ve gained under neoliberalism for those who’ve lost out.

But for Collier, the root cause of these malfunctions is not the structure of the neoliberal economy itself, nor the rapaciousness of a small financial elite. It is, instead, the rise of a new skilled and salaried middle class who can capture the economic and social gains generated by highly productive and asset-rich city economies. “The newly successful,” writes Collier, “are neither capitalists nor ordinary workers; they are the well educated with new skills. They have forged themselves into a new class, meeting at university and developing a new shared identity in which esteem comes from skill.”

This group, says Collier, has not only captured policymaking but, to rub salt in the wound, developed an ideology whereby they – because of their mixed ethnicity and liberal sexuality – can portray themselves as victims in greater need of sympathy than the working poor, and at the same time justify their own lack of ethical belief.

Collier’s identification of the urban salariat as a “new class” is not simply a metaphor. He classifies the typical behaviours of young, urban, educated people as economic “rent-seeking”, which, in traditional economics, refers to activities designed to increase your own wealth without increasing the wealth of society. It can range from property speculation to trying to rig government regulations to favour your firm.

Collier, however, sees the lifestyle of educated urban people as the same kind of thing. Ducking and diving to get a decent job, investing in private tuition to improve your skills, “delaying marriage or delaying children” – each of these is portrayed as a form of exploitative behaviour, detrimental to the small-town poor, which must be discouraged by taxation and regulation.

Just as Keynes wanted “euthanasia of the rentier”, Professor Collier wants fewer lawyers, fewer actors, fewer migrants and fewer people avoiding marriage and family life. If you are wondering what kind of politics emerges from all this, you will not be surprised to learn it is a form of social-democratic conservatism, severely critical of Bernie Sanders, Jean-Luc Mélenchon and Jeremy Corbyn – whose followers are written off as “youthful idiots”.

Collier wants to save neoliberalism through a distributional attack on the urban salariat and a repudiation of its morality. So, although he wants to discourage high property values in cities, he is against rent control – which is too Marxist – and against a sudden programme of housebuilding, because it risks tanking house prices. To protect the political system from an enraged radical populace, Collier advocates depriving members of political parties from selecting who leads them – better that only elected representatives should have a say.

There is a logic to the nostalgia. Since the most successful and inclusive form of capitalism in our lifetime was the communitarian statism of the 1950s and 1960s, to recreate it Collier argues we have to discourage the morality and lifestyle of educated, mercurial and seemingly amoral young people, limit the migration that is annoying low-skilled people, and promote the “ethical family” and patriotism as the roots of shared identity.

But it is a doomed project. First, because it frames the task of renewing capitalism in opposition to the social values of the rising generation. Second, because, unlike the project of the radical left, which seeks to free the young generation from debt peonage and stagnating wages, Collier wants explicitly to penalise them until their behaviour falls into line with the communitarian project. Third, because it avoids the root of the problem: a system mired in financial rent-seeking by super-rich elites and geared to boom, bust and speculation, with an ever-greater fiscal hangover limiting public investment and growth. To these problems, which are the source of radicalisation to the left, Collier’s solutions are timid.

Yet the central call of Collier’s book – for a return to ethics in policymaking – is welcome. For as Tim Rogan points out in The Moral Economists, it is remarkable how unmoral the left’s critique of capitalism has become. Across the developed world the dysfunctions of free-market economics are seen as negative material outcomes: rising inequality, low growth and poor social mobility. While the left’s emphasis on material inequality seems unremarkable, says Rogan, “in historical perspective it is extraordinary… An alternative tradition focused less on material outcomes than on moral or spiritual consequences has fallen into disuse.”

Surveying the work of Tawney, Polanyi and Thompson, Rogan shows how the 20th-century moral critique of capitalism was rooted in humanism, in part derived from the Judeo-Christian religions, and in part from their last prophet – the early Marx. The attack on humanism after the 1960s, first by structuralist Marxism and then by postmodernism, stripped the left’s moral critique of capitalism of its confidence.

For the followers of Louis Althusser, history was a “process without a subject”. The downsides of capitalism had to be calculated functionally – in terms of the rising technology clashing with old forms of social organisation – and not against the moral claim of working-class people to a fully human life, which was seen as a hangover from Christian socialism.

Each of the theorists Rogan surveys studied the transition from late feudalism to early capitalism, observing the death of a pre-capitalist moral universe as industrialisation and commerce introduced utilitarian ethics to the masses. Each also observed among the 20th-century working class a surviving moral critique of capitalism and an alternative moral practice: Tawney found it in the everyday solidarity of his contemporaries in the Potteries; Thompson in the literate and cultured lives of the 19th-century pioneers of labour he studied in The Making of the English Working Class (1963).

Each, in turn, tried to ground this plebeian moral alternative in something theoretical: for Tawney it was Christian socialism, for Polanyi a rereading of Adam Smith and for Thompson the early Marx. Ultimately, Rogan shows, they were all unsuccessful, leaving the ethical framework for 21st-century capitalism open to the forces Collier derides: utilitarianism and Rawlsian justice theory. Which begs the question: what might be the moral basis for a critique of neoliberal capitalism, should anybody beyond a few nostalgics be in the market for it?

If we are to judge the Gestapo-like tactics of the Department for Work and Pensions, the actions of Brett Kavanaugh, or Duterte’s death squads in the Philippines as merely dysfunctional to the operation of the free market and the rule of law, then we don’t need a moral philosophy. The airport bookshelves are groaning with blockbusters insisting humans are “already algorithms”, under the complete control of our DNA and our smart devices, and thus absolved by neuroscience from moral responsibilities founded on human values.

For Collier, the biggest mea culpa neoliberalism must deliver is over the destruction of community, without which reciprocal obligations cannot give rise to shared values. But having rejected utilitarianism and social justice, Collier never suggests what the source of a new shared value system might be, other than a spontaneous mass return to the thought-patterns and behaviours of his home town, Sheffield, in the 1960s.

People shaped by 30 years of compliance with neoliberalism, for whom freedom has come to mean the ability to choose between latte and cappuccino, cannot return to the value systems of their grandparents. A new moral critique of capitalism would have to be based on a shared concept of the human rights accruing to an adult with a smartphone, a credit card and a Tinder account.

The networked generation, written off as amoralists and rent-seekers by Collier, are in fact engaged intensely in questions of practical morality, above all via the agony columns and private social networks of advice. Is it right to “ghost” somebody you slept with but didn’t like? Can polyamory work without someone getting exploited? Can you snort cocaine without becoming complicit in the destruction of rainforests? Though these questions sound facile to the older generation, they should be read as evidence that the young generation is searching for an alternative morality, albeit in a largely godless world.

Among the networked social movements of the past ten years, from the British student revolt in late 2010, via Greece and Turkey, through to #MeToo and Corbynism, I’ve found an implicit moral critique of capitalism amounting to this: it dulls human potential, requires absurd levels of performative behaviour, and makes you unhappy. Though that is not the same critique as the one Tawney found in Staffordshire, or Polanyi in 1920s Red Vienna, it is an implicit moral system none the less, and rooted the same desire to live a fully human life.

Looked at this way, the networked individuality that characterises the new demos of the 21st century is something more than selfish amoralism. This group, too, can generate oppositional movements, ideologies and projects. It, too, can be communitarian: witness any music festival, or rave, or just a beach such as Brighton or Bondi on a really busy summer’s day.

If so, the 21st century will not play out as a battle between the emotionalism of the extremes versus the pragmatism of the centre. It will be a struggle over which moral critique of neoliberalism wins.

In that struggle, a truly “hard centre” would make a choice: to ally with the left, with the radical movements inspired by Corbyn, Mélenchon and Sanders, against the fascists, misogynists and xenophobes, wallowing in nostalgia. It’s a choice modern centrism seems determined to avoid making. 

Paul Mason’s “Clear Bright Future: A Radical Defence of the Human Being” will be published next year by Allen Lane

The Future of Capitalism: Facing the New Anxieties
Paul Collier
Allen Lane, 256pp, £20

The Moral Economists: RH Tawney, Karl Polanyi, EP Thompson, and the Critique of Capitalism
Tim Rogan
Princeton University Press, 280pp, £30

Paul Mason is a New Statesman contributing writer, author and film-maker. As economics editor at Newsnight, then Channel 4 News he covered the global financial crisis, the Arab Spring, the Occupy movement and the Gaza war. His bestselling book Postcapitalism has been translated into 16 languages. His play Why It’s Kicking Off Everywhere was televised on BBC Two in 2017. 

This article first appeared in the 02 November 2018 issue of the New Statesman, The Great War’s long shadow