The New Serfdom

by Angela Eagle

  CO-OPERATION

  We believe in the values of community and social solidarity. Consequently, we believe in the power of co-operation. We believe that people working together achieve more than people existing in solipsistic isolation or dog-eat-dog competition, where morality is based on what succeeds and the only measure of success is the size of your personal bank balance.

  To quote the party constitution’s current Clause IV, which set out Labour’s aims and values after 1995:

  The Labour Party is a democratic socialist party. It believes that by the strength of our common endeavour, we achieve more than we achieve alone so as to create for each of us the means to realise our true potential and for all of us a community in which power, wealth and opportunity are in the hands of the many not the few, where the rights we enjoy reflect the duties we owe, and where we live together, freely, in a spirit of solidarity, tolerance and respect.

  The earliest pioneers of socialism in Britain, such as Robert Owen, experimented with communities based on the cooperative principle. They understood that we are social beings living an interconnected life. Modern technology will only increase this connection, so our society and our community remain important. As such, they need to be nurtured, supported and strengthened.

  INTERNATIONALISM

  We believe that the true emancipation of human beings from injustice and exploitation can only be achieved by international co-operation. Just as capital is global, it is important that the interests of labour can be co-ordinated across national borders too. Throughout its history, the Labour Party has forged alliances and campaigned internationally for social and economic justice. From its support of the battle for self-determination in the colonies of the British Empire to the campaign against the evils of apartheid in South Africa, Labour has sought to project its values around the world. Labour’s backing in the fight against fascism was crucial in defeating the policy of appeasement that led to it joining the wartime coalition headed by Winston Churchill. In the aftermath of the war, Labour’s support for the creation of the United Nations and the adoption of the Universal Declaration of Human Rights neatly encompass the value of internationalism in action. As the world becomes more interdependent, the need for international co-operation will only grow stronger. The battle against catastrophic climate change is only the most important example of this.

  CONCLUSION: WHAT LABOUR BELIEVES

  Labour was born to create a better society for all. It came into existence in an era of rapid economic and social transformation which was changing Britain out of all recognition. Its appearance on the political scene was the culmination of the work and dreams of many generations. It embodied the aspirations of millions for a better chance at life and the pursuit of prosperity and happiness for all. Fighting for a fairer society was its core task. And that is the basic task which now needs to be accomplished once more in another era of rapid change and transformation, where inequality is rising sharply and life chances are once more correlated with the social class of one’s parents.

  Labour was focused primarily on the empowerment of the working classes as the lever for change and it certainly ensured that those who came from the working class were represented in the ranks of those seeking to govern for the first time in our country’s history. But Labour also attracted plenty of idealists and activists from the middle and professional classes, too, who were horrified by the poverty they witnessed and saw the need for a fairer, more equal society, in which all human beings were afforded the dignity and opportunity to live a good and rewarding life.

  Labour came into existence to rebalance the rewards flowing to those who work for a wage (labour) relative to those who own the means of production (capital). Prior to its emergence, it was clear that there was a gross imbalance between the forces of capital and labour which needed to be addressed in our politics. This task is as relevant today as it was then.

  It is now vital that we consider how democratic socialism should once more evolve to answer the challenges facing Britain in the twenty-first century. These have been made infinitely more difficult by Brexit. There are signposts to be found in the insights of earlier thinkers who wrestled with these questions in their own time, but we must find our own answers for our own generation.

  PART 2

  THE STATE OF OUR NATION

  CHAPTER THREE

  WANT

  We humans are an ingenious species. We’ve reached the moon, plumbed the depths of our seas, split the atom and eradicated some of our most dangerous diseases. But we have never managed to create a society that hasn’t experienced the evil of want: poverty and the attendant ills that go with it, such as hunger, homelessness and mental ill-health.

  Poverty is stressful, humiliating and degrading to self-worth. If there was something we as human beings should put our minds to, it would be eliminating this wasteful and unnecessary evil.

  Britain’s most famous chronicler of the lives of the poor was Charles Dickens. Dickens wrote with huge moral force about the iniquities of a time in which children starved on our streets and slaved away in brutal workhouses. In part thanks to him, a series of laws were passed in the nineteenth century and early twentieth century to alleviate the suffering of the poorest in British society.

  By the time William Beveridge first wrote about the ‘evil’ of want, Britain had already legislated for a basic safety net and many of the horrors of Dickens’s times had been eradicated. The poverty Beveridge sought to fix was one of worklessness, and so getting people into jobs was central to his plan. In the aftermath of the mass unemployment of the inter-war period, which had done so much to turbo-charge the rise of fascism, Beveridge broke sharply from previous political practice in Britain by making his aim to reduce unemployment as much as possible, if necessary by having the state create jobs. The work of J. M. Keynes had established how economic policy could be used to accomplish this goal. Clement Attlee’s government went on to nationalise part of the British economy, and helped our industries become globally competitive by investing to improve productivity. If demand for labour went down, Keynesian economics had shown how the government could intervene to give it a kick-start. This approach to managing our economy endured until the 1970s, when rising unemployment and inflation (so-called stagflation) caused the political consensus to break down. During this time it became fashionable to recast unemployment as a problem of employability – the attractiveness of individuals to prospective employers, aka the ‘supply side’ of the labour market – rather than being associated with fluctuations in demand. The focus of the government switched to helping businesses to create jobs by making life easier for them. Cutting down on regulations and the demands on private enterprise, they claimed, would keep Britain prosperous.

  Apart from a brief period after the financial crisis, this approach has persisted. In its purest, most ruthless form, under Margaret Thatcher’s government, it led to soaring unemployment of up to 12 per cent – over 3 million people. Beveridge would have turned in his grave. No post-war politician before Mrs Thatcher would have been prepared to countenance unemployment rates so high. The Conservative government had allowed poverty to become a problem again, blaming it on individuals for not being employable while making life easier for the rich owners of large companies.

  There are two types of modern poverty. One is the kind that is gleefully depicted on shows such as Shameless and the exploitative, disgusting ‘poverty porn’ of Benefits Street. This portrayal of poverty is the subject of fulminating editorials about the ‘feckless poor’ in right-wing tabloids. They present it as the result of individual problems such as a lack of education, alcohol or drug dependency, or criminality, and often portray it as intergenerational and persistent. As it happens, Britain has one of the lowest ‘persistent poverty’ rates in the world and the fifth lowest in the EU – around 7.3 per cent of our population have been in poverty for two of the last three years.

  Despite these figures, the evil of want is much more pervas
ive than we might think. Britain has quite a high poverty rate – around 16.7 per cent of the population – because a lot of people are on low wages, are underemployed or not able to get the hours they need to get by. This is the other kind of poverty – the type that is caused by the structure and nature of our economy, which cannot plausibly be blamed on individual failings, even for the purposes of right-wing Hayekian propaganda.

  On top of those figures, around 30 per cent of people are at risk of poverty. This means a really significant proportion of our fellow citizens are always teetering on the edge of not being able to fulfil their basic needs. The insecurity and fear that this sort of precariousness causes is inherently stressful and causes a constant strain on rising numbers of people. And this is all happening at the same time as we have record low unemployment.

  This structural poverty is a result of the Hayekian revolution of market fundamentalism and the Thatcherite policies that put them into effect. The Conservatives stripped back the state and our safety nets because they perceived them as dangerous socialist ideas. They strengthened the power of owners over workers by going to war with trade unions and making it fundamentally harder for workers to exert their collective power to ensure that pay and conditions were improved and not eroded. They celebrated the extraordinary accrual of wealth by those who already have capital, claiming it was all OK because it would eventually ‘trickle down’ to everyone else.

  As a recent report on the state of the British economy, Time for Change: A New Vision for the British Economy by the Institute for Public Policy Research’s Commission on Economic Justice, asserts:

  The UK’s high employment rate has been accompanied by an increasingly insecure and ‘casualised’ labour market. Fifteen per cent of the workforce are now self-employed, with an increasing proportion in ‘enforced self-employment’ driven by businesses seeking to avoid employer responsibilities. Six per cent are on short-term contracts, and almost 3 per cent are on zero-hours contracts. More workers are on low pay than ten years ago. Insecure and low-paid employment is increasing physical and mental ill-health.

  Is it any surprise that so many people are only just about managing?

  All of this is even more difficult to stomach when there appear to be so many people, sometimes perceived as undeservingly so, like the bankers who caused the latest financial crash and Britain’s endless supply of Z-list celebrities, who are living life so large.

  The creation of this economy, which is characterised by precariousness, actual inequality and growing perceptions of inequality, has played a big part in driving the political anger and volatility that has been such a feature of elections over the past few years, not just in the UK but in comparable countries like the US and in some European countries.

  All this is not to say that the United Kingdom has not made enormous strides in improving living standards over the past decades and centuries. We have more material possessions than before, because the costs of those goods has been inexorably driven down. Think of the cost of clothing, of household goods like televisions, washing machines and dishwashers. That fall in price has been a result of our particular globalised form of capitalism. It has driven down the costs of consumer goods and widened choice and availability.

  However, it’s also true that there is a decline in how many people own their own homes in which to put these goods. The real-term costs (i.e. once you adjust for inflation) of some of our basic needs – housing and utilities in particular – have gone up over the past few decades. Both housing and gas – since 1996 – and electricity – since 1998 – are now primarily provided by the private sector, which means by companies whose first directive is to create profit for their owners. But given housing and fuel are captive markets, providing basic necessities you cannot live without, the providers are under no pressure to lower the price or increase quality. All they care about is that they make a profit.

  In short, our current system is quite good at providing cheap consumer goods and quite bad at providing affordable basic needs.

  The psychologist Abraham Maslow wrote in the 1940s about people’s ‘hierarchy of needs’. It was an evolution of other thinkers’ theories of human nature, wants and needs, including that of Karl Marx. Maslow argued that only by satisfying our most basic physiological and security needs – which he identified as belonging, self-esteem and self-actualisation – can we be freed to satisfy our higher wants. His pyramid of needs, shown below, has had a profound influence on a number of fields, so how might we use it to look at the extent to which our basic needs and our higher wants are being satisfied by what our modern economy actually delivers?

  Capitalism has proven itself to be brilliant at producing cheap consumer goods and services. We have more ‘stuff’, more access to information and to a richer array of entertainment than ever before, so our higher wants have never been so satisfied. But profit-driven private markets are remarkably bad when it comes to providing for our most basic needs. In Britain, we have thus far decided that some of our most basic needs should be out of the hands of the market. Our National Health Service, our emergency services and our social security safety net are administered by the state, despite the market fundamentalists continuing to argue for marketisation of this provision, and their continuing eff orts to encroach around the edges of it. We know from other countries that when you do privatise services like healthcare, the outcomes are terrible. In America, millions are without coverage and yet the US spends more as a percentage of its national income on healthcare than any other developed country. Most British people would understand that this is because healthcare is a basic need; profit-driven healthcare providers would by their very nature exploit the captive market of people that need their services to maximise their own profits.

  But before we get too smug at identifying the idiocy that has lain at the heart of US healthcare policy for decades, let’s just remember that that’s pretty much the situation our housing market is in. And our utilities markets, which were privatised by Mrs Thatcher in the 1980s. Substantial swathes of our transport network, too, went the same way and are now largely owned by foreign states seeking to maximise their profit at our expense. Even our broadband network, an increasingly indispensable utility in modern Britain, is privately owned and provided for. It is precisely the injection of market fundamentalism into the provision of services and goods that we all need that has allowed those who provide these services to get richer and richer while the public pays through the nose for the utilities that are essential to life. This is why Labour’s calls for nationalisation of certain national utilities and the transport network has gone down so well. Other EU countries efficiently and effectively run these necessary services on a public basis; there is absolutely no reason beyond the blind dogma of market fundamentalism and its abhorrence of state action why we shouldn’t do so too.

  It is an irony that right-wing newspapers love to fulminate about poor people in council houses owning large televisions and spending money on clothes, since it’s the trickle-down system for which they have advocated – on behalf of their plutocrat owners – that has allowed this anomaly to emerge. It is the offshored production of consumer goods from Britain to locations with much lower labour costs and weaker regulatory regimes that has brought down the cost of 50-inch televisions and jeans and dishwashers and party dresses to a level at which they can be bought by poorer people. But, of course, it is the shedding of the jobs producing those goods, the evisceration of our manufacturing and industrial base, the failure to invest into lifetime education, the deliberate weakening of the trade unions, that has kept people poor and income distribution so skewed. The impoverishment of British people was done at the behest of plutocrats, and then they have the temerity to slam those very same people – many of whom work one or more jobs to earn their thin gruel – for being able to buy the cheap goods that were, apparently, the upside of the market fundamentalist economic experiment. For shame.

  At the same time as we are having
to work harder and harder to fulfil basic needs because of real-term rises in the prices of necessities, inequality, which declined for forty years after the Second World War, has been rising in Britain for thirty years.

  This trend was exacerbated by the financial crisis, which has led to stagnating wages and living standards for most Britons in the past decade, whereas the richest have recovered to the status quo ante. A 2017 study by the Resolution Foundation showed that households with incomes of £275,000 or more – the top 1 per cent – had seen their share of national income return to its pre-crisis levels. However, the other 99 per cent of UK households continued to struggle to regain their financial power.

  The Office for National Statistics’ figures on average wages in Britain show that we have had ten years of stagnation in real terms. Families on low and middle incomes have seen their living standards rise by just 3 per cent since 2002/03. Once housing costs had been taken into account, they were no better off than they were fifteen years ago. One way of looking at how much families have to spend and how confident they are about parting with it is to look at household spending data, which the Office for National Statistics collates. There has been a decline in real-term spending by British families over the past decade, a remarkable reversal of what had been a soaring trend in spending power.