Thursday 14 February 2019

Capitalism Reshaped Post Brexit? An Important Insight

For the second time in as many weeks I find myself recommending a piece by Larry Elliott in the Graun. 
Ignore the free-trade evangelists. Brexit can create a fairer economy.  Free market economics created a world fit for multinationals. But we need less frictionless trade and more local control
OK, look past the silly headline (the wording in the link suggests it started life with a different title); he's onto something.  I don't have time just now for the full rejoinder-essay, but it's a great provocation with an important insight at the core.



Raedwald said...

Recognising that the shift from Internationalism (free movement of goods) to Globalism (free movement of goods and capital) from the early 1970s has brought us to where we are is one thing - turning the world back to an Internationalist place is quite another.

Yes, I wholly support Internationalism, and Localism - but have yet to find anyone who supports a return to capital controls to achieve it. Or anyone who actually wants a return to pre-1971 Bretton Woods in any form.

Larry may agree that we need a more Internationalist economy, but I wish someone would tell us HOW

Bloke in North Dorset said...

Larry was on a recent Spiked podcast, I was quite impressed with his position and arguments.

jim said...

Fine words butter no parsnips.

Once upon a time we were the ones doing the globalising and the rest had to suck it up and localism got them nowhere. Now the boot is on the other foot and we start whining s'not fair, we want localism. Well we could still be snuggled up nice and warm like piggies in a sty - in the EU. A large market bloc very adept at protectionism.

But Oh Dear Me No, we mistook or were misled into thinking the rough side of globalism was a consequence of being in the EU. Au contraire, we were protected from the rougher winds but are now set to go out into the cold wide world with not much more than a wet nappy for protection.

Capitalism is not going to hang around waiting for slowcoaches. The gods of capitalism are on the side of the big corporations. By comparison solo governments are weaklings to be bought, sold and bribed. Stick together and we might live, alone we will be hung out to dry.

The world has flattened out and an Englishman is worth no more than anyone else offset only by location and local investment. Flattening looks set to continue.

E-K said...

"*we* were the ones doing the globalising"

My ancestors were down pits. They didn't get the vote until after the retreat of Empire. They lived in squalor.

"Well we could still be snuggled up nice and warm like piggies in a sty"

Plenty of jobs and industry went whilst in the EU and competition imported for those left. Snuggled up like very obese piggies on welfare. No thanks.

andrew said...

Not sure flattening will continue.
Extractive govts with poor regard for property rights only prosper as long as the tide rises.

andrew said...

Otoh the quality of our govt could fall to thwir level. So i may eat my words

Anonymous said...

Capitalism - a system of economics and underlying laws where the [commercially] strong take advantage of the weak.

Communism - a system of economics and underlying laws where the [politically] strong take advantage of the weak.

Liberalism - a system of economics and underlying laws where the no-one gives a shit so you can do whatever you want.

jim said...

Collective bargaining was once the only tool workers had with which to pressure employers into better conditions. That and the fact that their work was valuable to the employers - employers just didn't like handing over much of the value generated. Two problems with this, the work may no longer be so valuable, machines or people elsewhere are an alternative. Secondly, up-skilling the workforce is expensive and only seems to work for a limited number, what do you do with the rest.

But now governments are in much the same position as workers were. They can see the nation being exploited and value being extracted. Realistically governments don't care much about workers but governments do have to find money to fill in the gaps left where corporate money has ceased to flow. Collective bargaining has moved on from the factory car park to international trade conferences. Localism seems an attempt to bring that back not to the factory car park and the workers but to some sort of government/corporate forum. Whether this game will work seems moot.

This raises two questions. How might capitalism develop as worker groups become less important and are replaced by governments getting together in 'collective bargaining'. How also might capitalism develop as robotics and AI reduce the importance of human workers (but increase the possibility of governmental interference). How indeed might governments develop when notions of sovereignty become subsumed by the need for cash and the necessity to cooperate in collective bargaining. We can already see hints of latter-day Arthur Scargills with an other-than-British accents.

A few more questions arise. What might happen to governments who think they can go it alone? How will workers fare when they become pawns in government/corporate power struggles?

E-K said...

Several world wars tipped the supply/demand balance for labour - at this point the Windrush arrived... during a baby boom !

The situation simply could not be left to stand.

1% of the British population were compensated when the slave trade ended, which is telling. This number sounds familiar today for some reason.

E-K said...

The Japanese have dealt with the issue of cultural preservation and demographics the right way - they are ready for the march of the robots.

James Higham said...

We await the essay.