An epochal change on our political culture

Rupert Read
13 October 2008

Rupert Read (Norwich, The Green Party): Here is a good place to start. Check out the sub-head to this piece in today’s ‘Telegraph’: "October 13, 2008 will go down in history as the day the capitalist system in the UK finally admitted defeat." These are extraordinary days. In fact, the crisis is so fast-moving now, that it would be more accurate to say: 'These are extraordinary hours'. This blogger's and then the Green Party's call for the banks to be nationalised - for no taxation without representation - have been dramatically vindicated. At last, we the taxpayers are going to get seats on the Boards of banks. At last, banks will be forced to lend to each other, and to their customers, especially small businesses, who are at the moment being either gouged or stonewalled by commercial banks. At last, the obscene profiteering of the banks will be reined in, including dividends and executive bonuses.

I would have preferred a bigger, fuller, more pro-active, earlier nationalisation. As detailed here, the 'preference shares' move last week was totally inadequate. If we are to put our money into banks, then we need to be able to exert real control over banks to change their behaviour. That is the path that the Government, albeit too tentatively, too piecemeal, and much much later than they should have done (echoes in that regard of their disastrous slowness over Northern Rock), have at last embarked upon. I hope that the Government (i.e. us taxpayers) are not over-paying even now for the shares of HBoS and RBS; we may yet true that a more dramatic total nationalisation has not yet been countenanced.

But what is clear today is: The Thatcherite experiment of finance deregulation has utterly failed. When the _Daily Telegraph_, for heaven’s sake, says, as above, that it is the dawn of a new era of state regulation and control, then you know that something profound has changed in our world... Compare also these words from Sir George Cox, the former senior independent director of (now-nationalised) Bradford and Bingley, on the Today programme this morning (Listen again here): ‘The market model for the economy has now been brought into question’. And ‘When this crisis is over, are the people going to say to the banks, “OK, now you can take control of yourselves again, until you bring about the next crisis”? Of course not.’ In other words: We need to think really radically, right now, and really long-term: we need, as I argued here, to consider the permanent nationalisation of big finance. (And we need to consider this worldwide. We need a Europe-wide or even worldwide ‘Green New Deal’, to solve and fundamentally alter long-term the currently-unsustainable nature of our financial and our business/industrial system.)

We need systemic reform of the banking system, to stop crises like this from ever re-occuring. But reforms alone will never be long-term-safe, because after a while a privatised banking system will start agitating and pushing to strip away and circumvent the protections and regulations; it will always want to take more risks with the public good than that public would. There are many who do not get this, yet: so, for example, the supposed ‘man of the hour’, Robert Peston, was prattling on just before 9 a.m. this morning about how any further moves toward nationalisation would be ‘Eastern European’; he descended from journalism into empty pro-capitalist rhetoric alarmingly quickly.

What we really need is to seize this historic moment to permanently eliminate the spectre of private banking profiteering and excessive risk-taking. The only sustainable banking system is a banking system that strips out the private commercial profit motive. We should have a banking system consisting of a large public sector that is democratically directed toward a sustainable economy, with ultra-low-interest-rates, plus a network of co-ops, mutuals and credit unions, to ensure diversity in the banking system.

But that is for next week... The question on my mind today in OurKingdom is: What does this massive Government move into our main High Street banks mean for the political culture of our kingdom? Cameron’s New Conservative Party is left rudderless in this new necessary climate of massive Government intervention; suddenly, the Tory message of a smaller state seems a dangerous irrelevancy, and their drop in the polls is already confirming that the public sense this. But Gordon Brown’s ‘light touch’ New Labour Government contributed just as much to the problem as the Party of Thatcher and Cameron did; Brown did nothing to try to avert this crisis in year’s gone be: he did not even try to regulate the City to prevent it, although he had years of warnings suggesting that he ought to consider doing so. The financial meltdown, like the (slower) climatic meltdown that industrial economies are quietly causing on a longer-time-scale, shows the bankruptcy – literally, the bankruptcy – of neoliberalism. We have been told for the last 30 years by all ‘mainstream’ politicians that the days of big Government are over: but the events of this year, and especially of this last week, and especially of this last 24 hours, are waking everyone up to the disastrous falsity of this claim.

If there is to be a future for our society, it requires strong government regulation of big business and big finance, to prevent a repeat of the current financial crisis, and to prevent manmade climate change from terminally over-heating our planet (and to prevent economic collapse as ‘Peak Oil’ bites, and to prevent famine and misery spreading as food security here and around the world becomes tenuous…). That is why we need a ‘Green New Deal’, as the Green Party’s Leader Caroline Lucas MEP is proposing, to fix our financial and economic system without wrecking the climate. Cameron and Brown alike are bereft of pro-active vision (as opposed to reactive piecemeal crisis-management) about how to do this – their shared neo-liberal ideology makes it impossible for them to have any such vision. It is Green leaders who now ought to be given the opportunity to make good on our promise of leadership and vision. For without vision, the people perish.

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