According to The Guardian’s George Monbiot, after each of the richest 100 people gained an average of $2.4 billion in 2012, they now hold wealth near equivalent to the United Kingdom’s GDP. The reasons, which he says are considered and chosen policies, will be familiar to readers of Northern Insight. They include:
- Reduced tax rates, less enforcement, greater regressivity;
- Refusal to recoup a decent share of revenues from natural resources;
- Privatization of public assets;
- Reduction of social services;
- Creation of toll-booth economies;
- Wage liberalization (deregulation, including open borders for migrants, undoing of pension obligations, etc.);
- Debasement of unions and collective bargaining, resulting in wage stagnation and stalled demand.
Theorists and economic managers promised something different. In Monbiot’s words:
The remarkable growth in the rich nations during the 1950s, 60s and 70s was made possible by the destruction of the wealth and power of the elite, as a result of the Depression and the second world war. Their embarrassment gave the other 99% an unprecedented chance to demand redistribution, state spending and social security, all of which stimulated demand.
Neoliberalism was an attempt to turn back these reforms. Lavishly funded by millionaires, its advocates were amazingly successful: politically. Economically they flopped.
To many, the arguments offered by Monbiot, with accompanying footnotes, will be convincing. He says the apostles of Hayek and Friedman “have conducted a 30-year global experiment and the results are now in. Total failure.“
Yes, the verdict might be in but the apostles are unmoved. Most believe that recent problems result from markets not sufficiently free and regulations still too restrictive. True believers have religion and are not about to change their faith. In fact, they criticize John Maynard Keynes, the main intellectual enemy, because he often changed his mind, and not just when the facts changed.
Monbiot notes that lavish funding by wealthy individuals allowed neoliberalism to gain political influence in the last three decades. We’ll have an an opportunity to see that effort in play here in British Columbia, particularly in the next 12 weeks. As I reported months ago, large sums of private money are committed, ready to supplement taxpayer paid messaging in favour of the BC Liberals.
However, for old warhorses aiming to buy an election, there are barriers today that didn’t previously exist. PVR’s limit the effectiveness of TV advertising and social media provides platforms for response and for original thought. The electorate will not be easily led by spinners and alarmists.