Free Market Free-fall: The Economy Issue
Article published: Monday, December 8th 2008
Prophesies of doom have filled the newspapers since September bar the odd distraction provided by Rossgate and the X-factor. We are experiencing ‘The worst financial crisis since the 1930s’, warned of ‘A looming global recession’ and told to expect ‘Mass unemployment’.
George W Bush said over the summer "Wall street got drunk…now it’s got a hangover." But not even the (former) big-drinking President will have experienced a hangover like this. The UK economy was certainly in on the party, and while it was in full swing, few really cared how it all worked. In fact, their bonuses depended on not caring!
In the midst of what’s being called a ‘middle class recession’, it’s worth remembering that the boom years weren’t great for everyone. The report ‘Poverty and Inequality in the UK’, released by the Institute for Fiscal Studies in June, found that UK "income inequality has risen for its second successive year and is now equal to its highest-ever level (at least since comparable records began in 1961)". According to the Organisation for Economic Cooperation and Development, the "the gap between rich and poor is still greater in the UK than in three quarters of OECD countries." Meanwhile, "the wage gap has widened by 20 per cent since 1985" and "child poverty rates are still above the levels recorded in the mid-1980s".
The size of trillion dollar bank bailouts make these figures harder to swallow. You might therefore expect a little gratitude from the recipients, a softer approach toward debtors perhaps. Far from it: house repossession rates have soared and Bank of England interest rates cuts still haven’t been properly passed on to customers. With government now launching a big brother-esque ad campaign against petty benefit fraud, claims that we live in a system of ‘socialism for the rich’ seem no exaggeration.
So what of the socialists then, and all the others opposed to capitalism from the Left? Is it a time for celebration? A time of opportunity? The idea that ‘the unfettered market’ works as a perfect system of distribution and exchange, which continually cleanses itself of inefficiencies, has been destroyed. And government intervention in key aspects of the economy- a central tenet of Left politics, though pursued to markedly different degrees – has now been implemented on a previously unimaginable scale.
Suddenly, the economy isn’t something that can be taken as a given and left to distant specialists. Examinations of the wreckage of the financial market crash reveal the calculated political decisions that gave rise to it. People are beginning to question whether this kind of capitalism (or capitalism itself) really is the only game in town.
So, we now want to warmly welcome back politics to the economy! Bookshops report that Marx has been flying off the shelves. People want answers, and not from those ascribing to the doctrines which created the mess in the first place. We’ve brought together a range of different perspectives from alternative thinkers who envisage a more socially and ecologically just society. They ask what went wrong, explore whether the crisis is indeed an opportunity for new ways of doing things and if so, as Vladimir Ilyich Lenin once said, ‘what is to be done?
More: Manchester
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