The two main news stories this morning both gave us an insight into how capitalist power works.
The first item is the increase in NICs despite repeated Tory promises not to do so. It would be nice to think this will lead to a backlash against the Tories. But it might not. People don’t like to admit even to themselves that they were stupid enough to let themselves be conned. One trick to protect their egos is to adopt naïve cynicism towards politicians in general: “they’re all the same, aren’t they?”. As the Economist put it:
It is tempting to think that, when policies sold on dodgy prospectuses start to fail, lied-to supporters might see the error of their ways. The worst part of post-truth politics, though, is that this self-correction cannot be relied on. When lies make the political system dysfunctional, its poor results can feed the alienation and lack of trust in institutions that make the post-truth play possible in the first place.
But who benefits from this lack of trust?
Capitalists, that’s who. Collective action, exercised in part through state politics, is a potential constraint upon capitalist power. The less trust people have in politicians, the less this constraint will be used. Colin Crouch has said:
An atmosphere of cynicism about politics and politicians…suits the agenda of those wishing to rein back the active state, as in the form of the welfare state and Keynesian state, precisely in order to liberate and deregulate…private power (Post-Democracy, p23)
Our second item is the news that BlackRock is paying George Osborne £650,000 a year. What are they buying? It’s not his economic expertise – he’d struggle to get a minimum wage job on that account – nor even his contacts. Instead, BlackRock is offering an incentive to the world’s finance ministers. It’s telling them that they too can get big money if they behave themselves in office*.
Such behaviour consists of giving the industry a favourable tax regime, lightish regulation, and ensuring a good flow of easy money. Osborne’s policy of fiscal conservatism and monetary activism had the effect of boosting asset prices (pdf), to the benefit of firms like BlackRock**.
This influence isn’t perfect – we’d probably not have had Brexit if it were – but it exists. The idea that democracy means equality of political power is a fiction in capitalism.
You might think this is a Marxist point. I prefer, however, to think of it as a Cohenist one:
Everybody knows the fight was fixed
The poor stay poor, the rich get rich
Except that not everybody does know the fight is fixed, because the question of how capitalist power is exercised – like other questions such as whether capitalism impedes productivity or whether hierarchy is justifiable – is not on the agenda. But then, the issue of what gets to be a prominent political question and what doesn’t is another way in which power operates to favour capitalists.
* I’m not saying this is BlackRock’s motive – but it certainly looks like the effect of its decision.