Notes On The News
by Gwydion M Williams
- Malignant Populists
- Broad Capitalism
- China Narrowing Its ‘Broad Capitalism’?
- Coolhearts, Immigrants and Brexit
- A War Against Islam
The New Right do for Western civilisation what Al Capone did for Valentine’s Day.
The centre and centre-left hate the New Right, but lost out in opposing them. Lost out because they misunderstood the issues. Lacked a correct understanding, which would upturn most of what they think they know.
From 1945 to the 1970s, the world seemed to have to choose between the Soviet and Western models. In the 1980s, the New Right started tinkering with the Western model, thinking they were improving it. But pulled back sharply with the economic crisis of 1987, now largely written out of history.[a] Unlike the much bigger crisis of 2008, Britain’s Tory government ignored New Right doctrine. Followed the ‘Keynesian’ system of massive government spending.
The 1987 reversal might have finished the New Right. John Major as Thatcher’s successor looked back to traditional one-nation conservatism. This was undermined by Tony Blair in Britain and Bill Clinton in the USA. Correctly seeing the need to modernise the centre-left, they made foolish choices about what to adjust. Knowing that most voters did not want the immediate abolition of capitalism, they were confused by theorists of both left and right describing the highly successful post-1945 Western system as capitalist rather than Mixed Economy.
The sudden collapse of the Soviet Union also helped the New Right bounce back. But it was a victory for the Mixed Economy or Broad Capitalism. The Prague Spring had opened the way to Chinese-style reform for the Soviet bloc, but was crushed by Brezhnev in 1968. Meantime China is wonderfully successful with an authoritarian but popular version of the Broad Capitalism. But Blair and the two Clintons lost touch with ordinary people. Did excellent work in social liberalisation and modest welfare, but dared do nothing that the rich elite seriously disliked. They really did believe that wealth would not exist without the elite being left to do as it pleased.
The New Right have messed up massively. Fantasies of making the Islamic World into a docile and obedient copy of the latest Western fashions have backfired. Failed because of a false reading of our own history. Western values were seen as a wonderful spontaneous outbreak of Freedom. They were actually imposed by an authoritarian elite with Enlightenment values. Controls were relaxed only after decades of hammering those values into a resistant population. The West attacked secular dictatorships doing the same thing in the Islamic world.
At home, they broke the informal Social Contract that had allowed enormous progress since the 1940s. Mass unemployment had boosted both Fascism and Leninism: the 1940s elite decided to avoid a repeat at all costs. In fact there was no cost:. There were Economic Miracles in Japan, West Germany, Italy and France, which all moved closer to Anglo values. Britain and the USA grew faster than they ever had before or since. But the ‘wisdom’ of the New Right told them that this was a pure accident. On no account should they do the same for the collapsed Soviet Union.
George Soros, not then famous or influential, had a moment of wisdom when he urged a Marshall Plan for Russia. But he couldn’t exactly say why. Despite his pretensions, Soros is not a philosopher, or even a systematic thinker. He keeps evading the logic of his own arguments. Will never say that the methods he used to grow rich were socially destructive and should be regulated against. Joseph Kennedy – father of the President –did just this in the 1930s, helping frame laws to criminalised the legal tricks he had used to grow rich. The man was a realist, even if some of his values were obnoxious by modern standards.
The Smart-Alecs of the New Right were sure that the methods that had actually weaned Western Europe and Japan away from fascism were a massive error. Their way would work much better in new and trusting post-Leninist Russia. This is as big a goof as their failure after shattering Iraq, but less recognised. The centre-left haven’t moved on from the Cold War. They let the New Right explain their failures in Russia as a baffling outbreak of evil, blamed personally on Putin.
(I explained last month that Russia’s wars beyond its borders have been to give self-determination to peoples whom the USA wished to deny it to. The USA also enforced independence for Kosovo, insisted that majority-Serb areas must be part of it. And regarding suspicious deaths: there have been no killings of members of Yabloko, the biggest pro-Western party, except in North Caucasus which is dangerous for everyone.[b] Those killed elsewhere maybe had murky connections. Or else were honest crusading journalists who threatened mid-ranking crooks without good Kremlin connections.)
At home, allowing mass unemployment and the loss of good well-paid working class jobs was bound to produce a backlash. For now, Theresa May manages to sound sympathetic, while making things worse. Inequality in Britain increases.[c] NHS cuts caused 30,000 extra deaths in 2015:[d] things are now worse. A deregulated property market and hostility to public housing have killed the notion of a ‘property-owning democracy’. Most young Britons will never own a home.[e]
Life for most people is also worse in the USA.[f] Bernie Sanders rightly noted that President Trump has appointed economic overseers who were part of the problem. [g] They plan even more deregulation: even greater freedom for parasitic finance.
How to end it? Corbyn should say that a return to wholehearted support for Broad Capitalism is the realistic goal. That complete socialism is a much more distant objective that could not be included in the actual program of a Labour government. Likewise Bernie Sanders, or whoever replaces him to lead the solid left of the Democrats.
If Corbyn is feeling bold, he might add that the Trotskyist movement as it emerged in the 1920s has a total lack of positive achievements. That it has never posed a significant threat to any government it hoped to overthrow. That its main threat was within the Soviet Union and within Global Leninism, where it certainly contributed to Stalin’s harshness at a time when Global Fascism was a very real threat. And that Trotskyism stood neutral in the actual struggle against Global Fascism, thinking it could suddenly emerge as a functional Third Force if it opposed existing anti-Fascism.
If speaking so means alienating the diverse Trotskyist sects, they are much safer to have as enemies than as friends. Only their would-be friends have ever taken any significant damage from them. Admirable intentions are ruined by their lack of realism. Trotskyists illustrate an old US saying: it isn’t ignorance that makes you a fool: it’s what you know that ain’t so.
‘Broad Capitalism’ is any system where capitalism is permitted but does not dominate. Where the state machine can override the wishes of business people, and often does so.
Up until the 1970s, the Western or Keynesian variant of Broad Capitalism was called the Mixed Economy. Vast efforts by the Hard Left convinced most people that it was actually just capitalism. The vast differences from Classical Capitalism and other versions of Narrow Capitalism got overlooked.
There is also Imaginary Capitalism, where everyone is a law-abiding sociopath whose needs and desires are perfectly expressed by cold cash. Where each unit of an identical human individualist can perfectly calculate its financial best option, even when experts cannot do so reliably in the real world. It makes for some fine fancy maths, which intimidates most people. But such maths is lousy at predicting real-world events.
(It is sometimes called physics-envy. But for physicists, even the best mathematic models are thrown out if they fail to match the real world. In economics, never.)
Thatcher and Reagan hoped to restore Narrow Capitalism as it existed before the 1930s Great Slump. They failed: we have a new version of Broad Capitalism, where private companies make huge profits from tax-funded franchises. Where rich individuals and gigantic corporation pay far less tax than the working mainstream, the 99% whose income comes from their own hard work.
There are many possible types of Broad Capitalism. 19th century Tories kept the booming British economy healthy by factory regulations that stopped industrialists from working to death the British workforce. They tried but failed to preserve large numbers of small farmers with the Corn Laws. Then from the late 19th century, the Liberals took over with the basics of welfare. Labour then replaced them. The system peaked between 1950 and 1970, which were also Britain’s best years for economic growth.
China’s own Broad Capitalism makes business people much more dependent on the state than has ever been true in the West. Foreign investors discover that you need ‘contacts’ at all levels to prosper. Most of the time, the central government first permits, but you also need a friendly regional government to enable. No one can get away with ignoring or defying the authorities, as sometimes happens in the West.[h]
The Soviet Union’s failure was caused by a peculiar attempt to create a state-run market that mimicked the outdated realities of Narrow Capitalism and the seductive notions of Imaginary Capitalism. When this failed, the displaced persons often brought their ‘wisdom’ to the New Right, whose thinkers are very often ex-Marxists.
China Narrowing Its ‘Broad Capitalism’?
“The 20th anniversary of the death of paramount leader Deng Xiaoping passed quietly on Sunday without fanfare and little coverage by state-owned media.”[i]
Chinese government intentions are always hard to read. But they may think that Deng made more errors than Mao. He repudiated and disgraced his first two choices for successor (though so did Mao). The Tiananmen Square protests in 1989 came closer to wrecking the system than Mao ever came: only the vile treatment of Russia in the 1990s restored the Party’s credibility.
Deng also allowed vast inequality and widespread corruption. Got away with it because the West was so keen to win China that it allowed China to take over enormous areas of low-cost manufacturing. This was much the same as the USA had earlier done for Western Europe and non-Communist East Asia.
Growth equaled the best years of Japan. The left-behind did OK, unlike the West:
|Total cumulated real growth 1978-2015|
|incl. Top 1%||2491%||198%||67%|
This is from Global Inequality Dynamics: New Findings from WID.world, [j] which includes Thomas Piketty. Like Branko Milanovic,[k] this report shows inequality rising fast under Deng and Jiang Zemin, but stabilising with continuing fast growth under Hu Jintao from 2002. The data stops just past 2014: we’ll have to wait to see if Xi Jinping’s successful drive against corruption has reduced inequality or just stopped it being flaunted.
Both studies fail to comment on what their own data shows about a stabilisation of inequality: much as I’d have expected. I was pleasantly surprised that they showed it at all. They and all other Western sources I’ve seen suppress the awkward fact that China under Mao saw economic growth that matched the world average and fast-rising life expectancy. Did this despite US hostility, international isolation and the need to be prepared for a superpower invasion.[l] Most Western writers on China mislead by only mentioning bold policies that went wrong, not the much larger number that worked well.[m]
I’m sure they’d also reject my Broad Capitalism / Narrow Capitalism / Imaginary Capitalism model. They have their own brand of Imaginary Capitalism, in which the rich are compelled to grab vast chunks of extra wealth thanks to economic abstractions beyond human control.
So, China rises with Broad Capitalism, with the socialist element maybe increasing. And if the West thought China would never move up-market, this was foolish. Under Mao, China got both H-bombs and rockets that could launch space satellites, with zero outside aid. After 1989, they absorbed knowledge from the former Soviet Union’s space program, but improved on it. They are currently one of only two states that can independently put people into orbit. (The USA lost it when they retired the shuttles, and is still working on fancy replacement rockets.)
Coolhearts, Immigrants and Brexit
1960s radicalism evolved into a Coolheart consensus. Everything was personal. Morality was oppression. The state was mostly bad news, though not when it came to enforcing rights for non-whites, women and gays. These are observably less discriminated against than they used to be, so state authority clearly worked. But on the less familiar matter of the welfare of the working mainstream, the working class and an unprivileged middle class mostly dependent on their salaries, they felt nothing could be done. Any state efforts to make things better would assuredly make things worse.
From the 1990s, it was obvious that a more-than-millionaire class had a growing share of the new wealth created by the entire society. In the USA, they got almost all of it. But if Coolhearts sometimes protested, they were also certain that neither trade unions nor state power could fix it. They asked overpaid managers to show better personal morality, and were astonished when this didn’t happen.
This elite consensus is being rejected right and left. We have more of the negative types of freedom, but not the security we once had.
You may feel that people should not prefer security to freedom. But you can reliably predict that most will actually do so.
It is sad but understandable that the poor and neglected blame immigrants. The well-off get benefits from immigration. Without proper state spending, costs are dumped on the poor.
Brexit is now irreversible. It was careless of Cameron not to set a voting threshold. In 1979, Scottish devolution got about the same majority as Brexit, but needed 40% of all possible votes.[n] Failed with 32.9%. Brexit got 37.47%, but everyone had assumed that a simple majority was enough.
Cameron might have demanded 60% for a massive upset to the status quo. He did not. British respect for democracy means that one extra vote is enough, without special rules. In 1989, Welsh devolution won by less than 7000 from more than a million votes. MPs since 1945 have won with majorities of 4, 3 or 2.[o] In 1886, an MP got zero and won with the Returning Officer’s casting vote.[p]
Corbyn was quite right to insist that Labour accept the vote. Fighting for decent terms is another matter.
A War Against Islam
Muslims in different traditions differ from each other just as much as a Roman Catholics, Greek Orthodox, Southern Baptists, Anglicans and Quakers. But it seems no one told Trump.
Islamic theology is immensely complex, with an ancient split between Sunni and Shia. Iranian hard-line Shia Islam has never included suicide bombers attacking ordinary Westerners. Very little encouragement of violence outside of majority-Muslim countries. Yet Trump has banned all Iranians from the USA, insulting surviving pro-Western elements.
Al-Qaeda and Daesh (‘Islamic State’) recruit mostly from Wahhabi Sunni Muslims, an extremist offshoot of the Hanbali school. This is the smallest of the four orthodox Sunni Muslim schools of jurisprudence. Most devout Muslims regard Wahhabism as an aberration.
Most of the 9/11 bombers came from Saudi Arabia, which has pushed Wahhabism all over the globe. The rest came from countries not banned by Trump.
Some Westerners say that Westernising the Middle East can’t happen until Islam is abolished. It is certainly a barrier to Israel grabbing yet more territory inhabited by Muslims and often including Islamic holy places. But in as far as Political Islam could be weakened, this was being done by the secular dictatorships that the West has been targeting.
It is going to end horribly.
Aleppo – a Weird Silence
When the Syrian government recaptured East Aleppo, the Western media predicted a bloodbath. And then dropped the matter, apart from reports of the torture that Syria has always practiced, often while being courted by the West.
You have to look hard to hear of rejoicing by Syrian Christians, descended from some of the first Christians beyond Roman Palestine.[q]
Most people never learn that no Western reporters dared enter the anti-Assad zones, and so relied on one side’s propaganda.[r][s]
“Monday, 13 April 2015 was a typical day in modern British politics. An Oxford University graduate in philosophy, politics and economics (PPE), Ed Miliband, launched the Labour party’s general election manifesto. It was examined by the BBC’s political editor, Oxford PPE graduate Nick Robinson, by the BBC’s economics editor, Oxford PPE graduate Robert Peston, and by the director of the Institute for Fiscal Studies, Oxford PPE graduate Paul Johnson. It was criticised by the prime minister, Oxford PPE graduate David Cameron. It was defended by the Labour shadow chancellor, Oxford PPE graduate Ed Balls.”[t]
“Western-led regime change has produced a catastrophic breakdown: 400,000 people are internally displaced out of a population of six million; more than a million have fled abroad. Many layers of conflict – tribal, regional, ethnic, religious, for and against the old regime – are now superimposed, one on top of another. Libya is now a country of several governments and none, where rival entities with grand titles – the Government of National Accord, the Government of National Salvation, the House of Representatives – fight for the right to claim authority over a state that no longer exists.”[u]
2% of Climate Scientists Can’t Be Wrong
When the vast majority of scientists move to a new view of the world, they have never yet moved away from the truth. Trump’s rejection of Climate Change will get him branded as a fool.
2017 probably will be cooler: a major El Nino has ended. But there are fears another one is stirring unusually quickly.Fear or hope for 2018, which sees mid-term elections.
Trump is likely to marry Hillary Clinton as to be vindicated by climate events.
Previous Newsnotes can be found at the Labour Affairs website, https://labouraffairsmagazine.com/past-issues/. And at my own website, https://longrevolution.wordpress.com/newsnotes-historic/.
- [a] https://en.wikipedia.org/wiki/Black_Monday_(1987)
- [b] https://www.quora.com/Has-anyone-from-the-Russian-opposition-party-Yabloko-been-murdered
- [c] http://www.huffingtonpost.co.uk/entry/tories-overseeing-biggest-rise-in-inequality-since-days-of-margaret-thatcher_uk_5891aaa5e4b03ab749ddd808?utm_hp_ref=uk
- [d] https://www.theguardian.com/politics/2017/feb/18/people-are-dying-at-the-hands-of-austerity-says-jeremy-corbyn
- [e] https://www.theguardian.com/commentisfree/2017/feb/06/home-ownership-tories-housing-crisis
- [f] http://portside.org/2017-02-04/what-made-great-recession-%e2%80%98great%e2%80%99
- [g] https://www.washingtonpost.com/news/powerpost/wp/2017/02/05/after-trump-moves-to-undo-financial-regulations-sanders-calls-him-a-fraud/
- [h] This is drawn from several books by actual investors. Something I’ve not yet got round to writing up.
- [i] http://www.scmp.com/news/china/policies-politics/article/2072169/chinese-media-low-key-about-deng-xiaoping-20-years
- [j] Available free as a PDF at https://www.aeaweb.org/conference/2017/preliminary/paper/en6b6859
- [k] See https://gwydionwilliams.com/46-globalisation/degraded-globalisation/
- [l] https://gwydionwilliams.com/99-problems-magazine/mao-and-china/
- [m] https://gwydionwilliams.com/99-problems-magazine/how-chinese-communism-fixed-a-broken-society/
- [n] https://en.wikipedia.org/wiki/Scottish_devolution_referendum,_1979
- [o] https://en.wikipedia.org/wiki/United_Kingdom_general_election_records#Smallest_majorities
- [p] https://en.wikipedia.org/wiki/Ashton-under-Lyne_(UK_Parliament_constituency)#Elections_in_the_1880s
- [q] http://www.ibtimes.com/christmas-aleppo-photos-video-show-christians-celebrate-assad-victory-syria-2464372
- [r] http://www.informationclearinghouse.info/46082.htm
- [s] http://www.lrb.co.uk/v39/n03/patrick-cockburn/who-supplies-the-news, subscribers only
- [t] https://www.theguardian.com/education/2017/feb/23/ppe-oxford-university-degree-that-rules-britain
- [u] https://www.lrb.co.uk/v39/n05/tom-stevenson/flip-flops-and-kalashnikovs, subscribers only.