BOOKBUSTER REVIEW
Stolen
By Grace Blakeley
Published by Repeater Books, rrp £10.99, available at Bookbuster
Review by Tim Barton
In relation to ‘rational policies’, as Liz Truss and her ideologically extremist cohort insisted their economic shock tactics were, one must note, to quote historian Tony Wood albeit in a different context, such policies are ‘rational only in the context of a particular system, which has itself proved highly irrational, to say the least’. The notion that ‘trickle down’ is sufficient under gloves-off unfettered radical capitalism, or even a thing at all, has surely been demonstrated to be nonsense, with bells on. Yet Liz, a former acolyte of the Hayek Group at Oxford University, is still that dangerous entity, a true believer.
This current fundamentalist doctrine was surely rendered anathema by the crash of 2008 – that crisis had its roots in what was sometimes called Thatcherism, Reaganomics, and more widely since, neoliberalism. Friedrich von Hayek, alongside other members of the ‘Austrian School of Economics’ such as Ludwig von Mises were right wing economists in the first half of the twentieth century, whose views became core economic values during the 1980s acceleration of ‘financialisation’.
THE NEW CASINO ECONOMY OF HIGH RISK GAMBLING
Grace Blakeley’s book, Stolen, is subtitled ‘How to Save the World from Financialisation’. In it she traces the demise of Britain’s industrial economy, which increased wealth (for some) via production and the rise of the City as the forge of wealth through financial speculation. This model was promoted across the board and encouraged many banks and building societies, alongside other investors, to move from low-return ‘safe’ investments to the new casino economy of high risk gambling. This was marketed as sexy, with yuppies and city boys minting it: in Harry Enfield’s words they promised to produce ‘loadsa money!!’
The banks and building societies offering mortgages, and the companies selling pensions, predictably created what any reasonably well-read citizen should have spotted well in advance (once, almost every household had, or had read, Charles Mackay’s fascinating 1841 book Extraordinary Popular Delusions and the Madness of Crowds, especially its first volume, National Delusions): vast overinflated bubbles, that, as with the South Sea Bubble of 1720; the Mississippi Scheme, also 1720; or the Tulipomania of the 1630s; were doomed to burst, crashing the sector and, as in 2008, the wider economy with it.
HANDING OUR COUNTRY TO GLOBALISED CAPITAL ON A SILVER PLATTER
Blakeley looks at such corporate financialisation, but also at the ‘financialisation of the household’ through, for example the sale of social housing under Thatcher’s ‘right to buy’ policy which has led to ‘rentier capitalism’ and a vaster ‘property-owning oligarchy’, and of the state itself, giving an excellent account of Tony Blair’s roll-out of Private Finance Initiatives, first introduced under John Major. These were quite rightly seen as privatisation by the backdoor, and have endebted the public for generations. Blakeley uses the subheading ‘PFI: Profit for Investors’, which is entirely apt. Selling off our assets is also one way of looking at the new ‘special economic zones’ and ‘free ports’. Brexit believers take note: far from getting our country back, we are in fact handing (what’s left of) it to globalised capital on a silver platter.
These processes, amongst others, are what have driven the excessive widening of the wealth gap between us and the rich. To reprise Tony Wood’s point, in Blakeley’s words, ‘whilst all capitalist systems are premised upon the monopolisation of the gains of growth by the people who own the assets, under finance-led growth these dynamics become more extreme’. It is not an aberration or perversion of capitalism but an outcome of capitalism’s inexorable logic. ‘Grow or die’ is the mantra, only from outside the system can we see this clearly as a deadly logic, an ethic Ed Abbey reminds us is shared by aggressive cancers.
CRASHING YET AGAIN, AND YET HARDER
Getting out of this mess is not straightforward. As Grace puts it: ‘the growth of finance’ (from about 1.5% of total economy profits between 1948 and 1989 to 15% by 2007) ‘led to the emergence of a new economic model’, with as a consequence, a ‘deep, structural change in how the economy works’. Yet this economic model is crashing yet again, and yet harder. Its collapse can only leave ‘chaos and destruction in its wake’. This destruction is not limited to the sphere of economics, but sucks political and social institutions into its void. The first tremors were austerity economics (Truss promises Austerity Mk2).
‘What kind of political agency, in any country, can assert control over capitalism run amok – and who
is going to summon it into being?’ asks Tony Wood. Blakeley makes a valiant attempt at answering
this existential question. She offers practical reforms ‘to radically shift wealth and power in society away from those who currently monopolise it, and towards those who have been forced to pay for the excess of these extractive elites’. I strongly recommend reading her ideas on these matters and her analysis of the crisis. Many of us are teetering upon the precipice, and indeed many have already tumbled. Whilst pitching her book as offering at least a little optimism, she holds few illusions, quoting as an epigraph to her conclusion Tony Benn’s ‘There is no final victory, as there is no final defeat. There is just the same battle. To be fought, over and over again. So toughen up, bloody toughen up.’
Step forward Rishi Sunak and Jeremy Hunt!
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