12 April 2016
Jeremy Corbyn gave one of his best Commons performances yesterday, challenging David Cameron over tax avoidance. Showing a flash of genuine anger and unforced passion, he asked the Prime Minister:
How can it be right that street cleaners, teaching assistants and nurses work hard and pay their taxes, yet some at the top think the rules simply don’t apply to them?
This is the sort of thing that Labour needs to do more often: turn the government’s disingenuous (and frequently patronising) rhetoric about ‘hard-working people’ on its head, and expose ‘some at the top’ as the real free-riders in our society.
As our contributor Eunice Goes reminds us in an article we released online today, Ed Miliband faced severe problems in articulating his social democratic vision because neoliberalism has become the ’embedded common sense’ of British politics and culture. Instead of talking about inequality in the abstract, it might be better for Labour focus more narrowly on the fact that excessive wealth is often unearned; the product of inheritence, tax avoidance or rent-seeking, rather than talent, industry and freedom.
Rent-seeking by monopoly capitalists, enabled by the anti-union and shareholder value policies of successive governments and CEOs, is also something that even that most orthodox and respectable of neoclassical economists, Robert Solow, regards as a major problem. As he put it last year:
one important reason for the failure of real wages to keep up with productivity is that the division of rent in industry has been shifting against the labor side for several decades. This is a hard hypothesis to test in the absence of direct measurement. But the decay of unions and collective bargaining, the explicit hardening of business attitudes, the popularity of right-to-work laws, and the fact that the wage lag seems to have begun at about the same time as the Reagan presidency all point in the same direction: the share of wages in national value added may have fallen because the social bargaining power of labor has diminished. This is not to say that international competition and the biased nature of new technology have no role to play, only that they are not the whole story. Internal social change and the division of rent matter too.
This suggests to me Labour doesn’t need to fight all its battles at once, or spend too much time worrying about abstractions like ‘neoliberalism’ or ‘inequality’ — however analytically useful they may be. The internal contradictions of the current order are bad enough in themselves. Whatever it may say, the modern Conservative party does not exist to promote innovation, liberty or fair competition in our economy. Instead, it routinely uses public money and state power to promote the very worst forms of rent-seeking, undertaken by monopoly utilities, security conglomerates, tax avoiders, letting agents, unscrupulous private landlords. Their talk of enterprise, merit, exertion and freedom remains persuasive, but it is also patently disingeunous.
Before we get too deep into questioning whether all those things are worthwhile, or part of a ‘good society’, or ‘socialist’, we might therefore want to spend more time pointing out the glaring inconsistencies within this dominant ideology. This is what Corbyn did yesterday, to great effect. As every good French revolutionary knew, the root of inequality is corruption. We need to be taking our new rent-seeking aristocracy to task. This is the underlying republican message of Piketty’s Capital, which opens, after all, with a quotation the ‘Declaration of the Rights of Man and the Citizen’ (1789):
Social distinctions can be based only on common utility.