Bring on the show trials

AN 82-YEAR-OLD man who fled Nazi Germany was yesterday thrown out of the Labour Party conference for disagreeing with a speech by Jack Straw, the Foreign Secretary...

Earlier, Walter Wolfgang was bundled out of the auditorium when he protested against Mr Straw comparing the political situation in Iraq to post-war Germany.

A second man who tried to defend the delegate's right to freedom of speech was dragged out of the hall by stewards.

The incident isn't surprising. New Labour was conceived on the ruins of inner-party democracy: what Kinnock started, with the witch-hunts and expulsions directed against the left, Blair has continued: the emasculation of annual conference and the NEC, the promotion of "unity" and "loyalty" as the supreme virtues, the concentration of power and resources around head office. That they're now roughing up pensioners in their own party conference is almost plus ca change.

They've applied the same techniques in power. From ASBOs and control orders, to the obsessional focus on presentation, a political leadership that since its birth has dedicated itself to uprooting opposition amongst its immediate circle would hardly act any other way when confronted by a whole country of potential malcontents.

The reaction at the BBC website is interesting. Overwhelming condemnation, obviously, but it was the use of the Terrorism Act to detain Walter Wolfgang that has rattled everyone: there may have been some expectation that it was intended for use against, well, terrorists, rather than 82-year old refugees. It's the little incidents like this that eat away at the grand schemes. Wolfgang's run rings round the supposedly professional New Labour media operation:

An 82-year-old activist thrown out of the Labour party conference for heckling Jack Straw has returned to the venue to a hero's welcome.
Walter Wolfgang, from London, was cheered as he held up his security pass - confiscated by stewards on Wednesday.

He said a "small mistake" had been rectified - unlike the "big mistake we made in invading Iraq".

Socialist Worker has the story on British Airway's machinations against the T&G.;

And, in other news,

French special forces have recaptured a cargo/passenger vessel that was hijacked to the Corsican port of Bastia by striking union workers.

Commandos abseiled to the deck of the Pascal Paoli from five helicopters as it came into port after being taken over in Marseille late on Tuesday.

(Thanks to Kotaji for the last one)

Piers and the Panopticon

On balance, Piers Morgan is probably a Good Thing. No, really: his editorship of the Mirror, until the bloody silliness with those photographs, was managing to drag the title back towards something like the newspaper it used to be: a critical, leftish, intelligent tabloid. (This isn't a point to be stretched too far, obviously; even at the height of its anti-war drive, the Mirror remained caught up with the same lazy journalism and contempt for its readers that drives the British newspaper market.)

Morgan's article for the Observer on youth crime, apart from once again demonstrating Tower Hamlets really does have it all, had a few startling statistics:

We are CCTV-mad in this country. I discovered in the course of filming this programme that Britain has 20 per cent of the world's CCTV cameras. Yes, 20 per cent. There are more cameras in Basingstoke than in New York City, where they are banned from places like the subway on civil liberty grounds.

The average Briton will be picked up by 300 cameras a day, creating a pervading sense of paranoia...

...which reminded me of IPPR wonk William Davies writing on OpenDemocracy the other day about the "age of surveillence" being a "new dotcom boom". Davies' thesis is that the ludicrous over-expansion of information technology in the 1990s created, in short order, the networked technology needed to maintain a very thorough system of monitoring and control:

But having been drawn into the digital age by the allure of its newness – just like any “early adopters” – we may now be settling down into a surveillance society where privacy is at best conditional, and contingency is monitored and dealt with. Historians may one day reflect on the bizarre coincidence by which westerners exuberantly flooded their societies with digital technology for very little reason whatsoever, just in time for it to be put to use as part of the largest international policing programme ever.

(Worth reading the whole thing.) Now, I'm not too bothered about either a system of continual electronic monitoring, whether dispersed in private security firms or centralised into the state, for the reasons approximately given here: continual and sophisticated spying generate too much information to process. I remember being told, during the course of a trial - not mine, he adds - that although a large number of CCTV cameras covered the area around the crime-scene, there was "too much footage" for the police to do anything useful with it. Newham council, down the road from Tower Hamlets, used to boast about both the extent of its CCTV coverage and the sophisticated face recognition system it was wired up to. The system didn't work.

What might be a little more alarming the possibility of combining the technology with dedicated human monitors. However, as (the inevitable) George Orwell indicated, to establish the organisations on the scale needed would require a fundamental transformation of society. Unless the proposed "anti-terror" legislation is more thoroughgoing than any of us suspect, that's not yet on the horizon.

Reassuring, no? I'm off to collect my ID card forthwith.

Neo-liberalism: no longer quite the thing?

It is, I grant, a hopelessly optimistic title but it's usually better to call these things too early than too late. The signs are there: most dramatically, the obvious unwillingness of large numbers to tolerate further "reforms" upon their basic public services. In both the French EU referendum and the German election campaign, it was the weight of popular feeling against neoliberalism that decisively tilted election results to the left; and, dropping the parochialism, the ferocity of anti-privatisation, anti-"Washington Consensus" anger worldwide is scorchingly apparent.

But more than this, it is perhaps just about possible to detect certain divisions appearing amongst those confronted with that anti-neoliberal heat. Splits over Iraq and Washington's new assertiveness have been obvious to all; but there seems to be just the vague glimmering of a realignment on economic policy. It's hard to put your finger on it, but the whisperings against the neoliberal consensus that have been heard in academic circles appear to be gaining a traction elsewhere. Keynes is a name that keeps cropping up.

And why shouldn't it? Far from being the end of history, the period since 1989 and the supposed unwinding of public expenditure in the west have been marked by an incredible turbulence. Blindly continuing on the same course in such circumstances could be considered as enormously foolhardy.

The economic historian Karl Polanyi left a theory of modernity in which a pure free-market is gradually undermined by democratic (and other) pressures for an expansion of public goods and state provision; whilst he did not forsee that this process could be reversed, the desire to "roll back the frontiers of the state" over the last twenty to thirty years can be viewed as an attempt to do precisely that.

It has not been wholly successful: as a share of GDP, public expenditure was almost identical when the Tories left office in 1997 to what it was when they entered in 1979. The state has shifted its functions, but it has not much changed its size. Given that, there is no reason to expect the neoliberal style of governance to be permanent. In conditions of persistent economic weakness, the pressure for alternatives will grow.

Vote Lib Dem, get Tory: II

Don't say I didn't warn you, but:

The Conservatives could form a coalition with the Liberal Democrats if there is a hung parliament after the next election, the Tory chairman Francis Maude, has said.

He told The Independent: "You look round the country and you see a number of councils where Conservatives are in alliance with Lib Dems, Birmingham, for example. There's no great drama about that."

Asked whether there could be a Conservative-Liberal Democrat coalition, he replied: "There's no reason why that should be out of the question If you end up with a hung parliament, there is either a minority government, which is unwieldy, or a coalition. You deal with what the electorate gives you."

New Labour: "addressing the full range of concerns"

Occasionally, you find a Parliamentary candidate from one of the main parties so dirty and rotten and desperate they'll try and stoke up racism to claw their way in to power. In the 1964 general election, Labour frontbencher Patrick Gordon-Walker was defeated at Smethwick in the West Midlands by a Conservative who campaigned under the slogan "If you want a nigger for your neighbour, vote Labour." Harold Wilson, then Prime Minister, rightly described the loathsome Tory creature as a "Parliamentary leper".

Labour's learned a trick or two since then. In a by-election last year, former management consultant and investment banker Liam Byrne scraped a narrow victory over the Liberal Democrats at another West Midlands seat, Birmingham Hodge Hill. Here he is in the Guardian today, freshly-promoted to a ministerial position, and sharing with us the secrets of continued New Labour success:

...in May 13% of Labour identifiers voted for another party and 9% stayed at home. The evidence shows that these were by no means all leftwing protests - where we lost support, we were challenged from left and right. Iraq was the most important issue for Labour defectors. But almost as many cited crime, antisocial behaviour and asylum as the reasons for failing to back us - the same is true of the economy and NHS. Regaining all these supporters means addressing the full range of concerns.

Here's Byrne "addressing the full range of concerns" on crime and antisocial behaviour during his first election campaign:

People of Hodge Hill deserve to know the truth about dangerous Liberal Democrat policies.

I know how concerned people of Hodge Hill, Alum Rock, Bordesley Green, Kitts Green, Stechford, Shard End and Washood Heath are about the anti-social behaviour of teen gangs and drug dealers. I want these gangs busted. I want these drug dealers put behind bars, I want the drug money of these so-called drug barons confiscated and used to make our area better.

I challenge the Liberal Democrat candidate Nicola Davies to defend policies that would make life worse for local people.

Here's Byrne on asylum:

Labour is on your side—the Lib Dems are on the side of failed asylum seekers...

We have taken tough action against those who abuse the system as a cover for economic migration.

While Labour were tough the Lib Dems were wimps—they tried to stop us taking away benefits from failed asylum seekers and they voted against plans to speed up deportations.

If the language is not that of Smethwick in 1964, the intention is the same.

Wacht auf, Verdammte dieser Erde

Quickly, for now, but what a thoroughly superb result:

CDU – 35.2% (225 Seats)
SPD – 34.3% (222 Seats)
Free Democrats – 9.8% (61 seats)
Left Party – 8.7% (57 seats)
Greens – 8.1 % (51 seats)

(as of Monday 10am)

The CDU have done significantly worse than polls expected: from a seemingly insurmountable 21 per cent lead over the SPD, they've slid back to barely scraping a single percentage point above Schroeder's party.

Phil at Actually Existing pointed out via email that, from a rock-solid 50% vote for the CDU-FDP, the right's combined total has has remained in the doldrums since reunification.

Even better, the Left Party is in third place in three (of 15) Laender, and second in a further three, ahead of the CDU. The Left Party's fantastic showing is directly related to the Christian Democrats' decline: prior to the alliance between WASG and the PDS, the CDU was on course to win a huge vote in the east; after its formation, the Left knocked a huge chunk of its support away. That, and the decided swing to the left across the country in general, was enough to deprive them of the votes they needed.

In the west, meanwhile, the radical left is gaining substantial support for the first time in 70-odd years. Significant pressure on its well-established working-class base from the Left Party forced the SPD to tack rhetorically a long way from its neoliberal "reform" programme. The CDU were denounced for their "cold" programme that failed to account for "social justice", whilst the flat-tax albatross undoubtedly cost Merkel thousands of votes.

You wouldn't have guessed it from, for example, the BBC report this morning, but the biggest single story emerging from the German poll is that the radical left have not only established a firm base across both east and west Germany, but have forced the German political establishment into its gravest crisis at least since reunification.

The best indicator, though, of the left's rise comes from the markets. They don't like the result one little bit:

Merkel's failure to win support for her plan may also make other politicians across Europe less prepared to make proposals that risk alienating the electorate.

"It's hard to get people to vote for the painful medicine you really need," said JPMorgan's Mackie. "It's not obvious where it's going to come from. I don't really see anyone offering it in France or Italy either."

Having forfeited their confidence, perhaps JP Morgan could dissolve these people and elect another?

And incredibly - or, really, not "incredibly" at all:

"We have to explore everything with the Greens," CDU economy and labor policy expert Peter Mueller, who is also prime minister of the state of Saarland, told reporters in Berlin today.

(Perhaps the Greens, too often little more than the FDP with windfarms, could follow the example of their friends in Leeds. Atomkraft - nein danke! Gewerkscahft - nein danke! has a certain ring to it.)

Lenin has a little more (and some good discussion in the comments), but check also Direland and A Fistful of Euros.

Update: Jonathan Steele is spot-on, here:

...Sunday's central message was a protest against neoliberalism. It had much in common with this summer's votes in France and the Netherlands against the EU constitution. Germany's paradox is that a country which is the world's second-largest exporter and can compete globally has an internal market where employers decline to invest, small business stagnates and joblessness is high. Then people are asked to sacrifice the welfare state they built up after 1945. Confused, bitter and bereft of leaders with a convincing programme, many are joining a growing trend in saying that there must be another course.

There is now the potential, probably everywhere, to create broad-based radical parties in opposition to neoliberalism. The language and the style of the politics needed have been around for a while, in the form of the anti-capitalist and anti-war movements; what is now being demonstrated is that the social base exists to support popular parties built on these lines.

Seditious libels

Good god:

Under another proposal likely to attract criticism from civil rights campaigners, the Government also announced stringent new rules to target extremist bookshops and curtail the dissemination of "terrorist publications".

According to the new law, a terrorist publication is any article that includes "a direct or indirect encouragement or other inducement to the commission" of terrorist acts or information that would help someone to commit an atrocity.

"Direct or indirect". What the hell is that supposed to cover?

Opposing collaboration

The interview with a Left Party activist at Lenin's Tomb has sparked a bit of a discussion about the co-operation of new left-wing parties with old social democrats in government. There's potentially a serious concern, given the way the PDS - one-half of the Left Party - has collaborated with the SPD in various local governments to impose the familiar neoliberal round of cuts in social spending.

Oskar Lafontaine himself, however, has ruled out the possibility:

German Left Party leader Oskar Lafontaine said he'll refuse to support his former ally, Chancellor Gerhard Schroeder, after next month's election even if that would stop opposition leader Angela Merkel taking power.

The chancellor's "Social Democrats are no partners for us," said Lafontaine, 61, who was once Schroeder's finance minister, in an interview in Berlin Aug. 27. "They're keeping to their welfare- cutting agenda. That's unacceptable to us."

It's a message that needs to be drummed home: the left can't work in government with any of the parties of neoliberalism. This isn't a dogmatic point: the rise of the new left across Europe has been fermented by the mass opposition to neoliberal politics. It would be immensely destructive to pretend otherwise. We're not here to join in the game that has been played for the last twenty-odd years. We're here to change the rules entirely.

Flat tax, flat earth II

It is an entirely mad scheme:

Almost 30 million people would be out of pocket under a 'flat tax' regime which would raise as much money as the current system, the Treasury claims...

However, Treasury number-crunchers calculate that charging the same rate of income tax across the whole economy would leave between 25 and 30 million people worse off if it were to bring in enough revenue to maintain current spending levels.

As was pointed out by HIOP in the Tomb's comment boxes, the real virtue of the flat-tax is its ability to repackage the decimation of government spending as a progressive, sensible measure that simultaneously helps the deserving poor and gives the rest of us nice fat wodge of cash. Thatcher was never able to "roll back the frontiers of the state" as she wished: as a share of GDP, government expenditure barely moved between 1979 to 1990.

But the flat tax revolutionaries think they have the answer, though it's not pretty:

The right-wing Adam Smith Institute, one of the few groups to have produced detailed proposals for a flat tax in the UK so far, admits that its plan, which would levy it at 22 per cent, with a personal allowance of £15,000, would initially result in a £60 billion reduction in annual government revenue.

If they're feeling apologetic, this is followed by a certain amount of hand-flapping about the Laffer Curve, vague pronouncments about the productivity rewards that would be reaped and the repeated belief that government revenues would eventually recover. It seems a little implausible to ask all this to make up for a £60bn shortfall, but of course that's not really the point.

What's unsettling is that, after years of economic defensiveness - including the spectacle, in this year's election, of Tories desperately claiming they had no plans to significantly cut government spending - the Conservatives are recovering something of their backbone.

The constraints that used to make even centrist politicians think twice about advocating a proposal so patently unfair and inequitable are atrophying. The consensus between the parties that rising inequality is essentially an economic and social ill has evaporated. The professional and the managerial classes now live in a universe in which their ever higher income is regarded as an entitlement. No obligation exists to the society of which they are part and, as a result, the infrastructure of social justice and equalisation of opportunity should essentially be paid for by those who might benefit - the poor.

Defections

Sarah Ruiz, Labour councillor in Newham since 1993, has resigned the Labour whip and joined Respect. From her resignation letter:

This is not a decision I have taken lightly. When I joined the Labour Party it still stood for social justice, peace and fair treatment for all. Under Blair’s leadership the Party has abandoned all of its principles...

I am mindful that the Leadership of Newham Council, especially Sir Robin Wales, has supported every policy of New Labour.

Instead of speaking up for the people of Newham Sir Robin has put self interest and the interests of New Labour first. This is clearly illustrated by the Council’s failure to condemn the government for persistently short changing Newham on government funding. Despite eight years of a Labour Government, Newham is still being denied inner London status – but the Mayor has run a half hearted campaign because we must not antagonise the government.

The Council continues to show contempt for local democracy – our 19,000 tenants are having the management of their homes handed over to an Arms Length Management Organisation – the first step to privatisation – without giving tenants a vote.

New Labour have let down the people of Newham and that’s a key reason why I’ve joined Respect – a party that stands up for old Labour values such as peace, human rights and justice.

Word has it that Newham Mayor, Sir Robin Wales, also chair of the Local Government Association and a big cheese in local government circles, is busily positioning himself to be Labour candidate for Mayor of London when Livingstone steps down. It would be just terrible if his Blairite copy-book was blotted next year by Labour losing control of a council they've run for decades.

Flat tax, flat earth

George Osborne is an irritating creature:

Shadow chancellor George Osborne says Britain should investigate the merits of a "flat tax" - where everyone pays the same rate regardless of earnings...

Mr Osborne said he accepted that the Tories had not "made an economic argument" for tax cuts at the last three general elections, or that they would deliver jobs and prosperity.

Osborne's argument is that the Tories just love cutting taxes. They just haven't persuaded the rest of us it's such a neat idea. In order to do so, they're going to sit down and work out what the consequences of cutting taxes will be, and then tell us all about it.

It's as perverse as a party telling us they want to raise taxes - and then thinking about what to do with the extra cash. Instead of using the tax system as a means to an end, Osborne and friends see it as an end in itself. It is, simply, an ideological preference for them.

The usual suspects have attempted to disguise flat taxes as sensible realpolitik. We can remove bureaucracy, improve efficiency - and, by increasing perosnal allowances, do something for the poor. Who but a miserly conservative would stand in the way of the flat-tax revolution?

But these Che Guevaras of the Adam Smith Insititute are covering up a big secret. There are only two groups who may benefit from a flat tax system: some, most likely not all, of the lower-paid workers; and virtually all those on higher incomes. A huge lump in the middle, currently taxed in a vaguely progressive fashion and recipients of significant benefits, could find themselves losing out.

An alliance of the idle rich and the working poor is not going to deliver an election victory. The Tories have, once before, defeated an unpopular Labour government by mounting an ideological offensive of the kind Osborne wants. No doubt the hope, still, is that a pastiche of Thatcher's Second Coming will wash a Conservative into Number 10.

What the glittery-eyed ideologues in today's Tories fail to realise is that, yes, a serious ideological battle was mounted by Thatcher; but the Tories won in 1979 because the ideological assault they promised had some appeal to large numbers of voters.

There are no reasons to think that grand schemes to simultaneously cut public expenditure and increase the tax burden faced by millions of voters would have the same impact.

Osborne, like other front-bench Tories, was (and is) determinedly in favour of the war in Iraq. The Conservatives appear dizzyingly aloof from ordinary voters: as Third Avenue says, we have an opposition party that "plans to remain in opposition for a very, very long time." What a terrible shame.

Monbiot on Geldof

George Monbiot's been on a roll lately. Here is, again, pitching into his old adversery, the court jester of happy-face neoliberalism, Bob Geldof:

The uses to which a Geldof can be put are limited. Before the summit he was seen by campaigners as naive, ill-informed and unaccountable. But he can make public statements with the potential to embarrass politicians. While they don't usually rise above the "give us your focking money" level, they do have the effect of capturing the attention of the press. But though almost everything he said he was fighting for has fallen apart, he has yet to tell the public...

...Bob Geldof is beginning to look like Mother Teresa or Joy Adamson. To the corporate press, and therefore to most of the public, he is a saint. Among those who know something about the issues, he is detested. Those other tabloid saints appeared to recognise that if they rattled the cages of the powerful, the newspapers upon which their public regard depended would turn against them. When there was a conflict between their public image and their cause, the image won. It seems to me that Geldof has played the same game.

Geldof's involvement certainly ratcheted the profile of events up several notches. He made some promising - or at least usefully ambiguous - noises about protests and the "long march to justice". And then, some time after his demand to bunk work and join "a million people" in Edinburgh and the confirmation of the Live-8 line-up, the ambiguity disappeared.

Behind the inanity, Live-8 was an attempt to bat the global justice movement even further to the right than the Make Poverty History campaign had been. It was unspeakably depressing to see, at the London concert's height, the Republican billionaire Bill Gates presented as a philanthropic hero - wrecking even Geldof's earlier claims that politics, not charity, provided the solution.

I don't think the attempt worked. Because the movement has far more solid social roots than Geldof and others realised, by Wednesday evening and the close of the protests at Gleneagles, Live-8 had neither substantially deflected it, nor won any greater support for the G8 leaders. By Thursday morning, the G8 agenda had shifted again.

Europe "heading for Third World status"

Ah, the Telegraph - a truly dependable source for grammatically-precise nutiness. What, for example, to make of the startling news headlined above? It would seem the government - as is its wont - has commissioned an "independent" selection of prophets and seers to gaze deep into their crystal balls and foretell of strange and terrible Events that shall come to pass.

Europe risks becoming a "second- or third-world region" within a generation because strict labour laws are preventing companies from restructuring properly, according to the author of a Government-sponsored report out today...

Mr Lewin warned that without more investment in ICT then "Europe will lose the technology and fall behind and become a second- or third-world country within decades".

..."within decades", rather than, say, a week.

A quick glance at Indep's report (PDF) reveals it to be the usual extended apology for the Lisbon Strategy: the EU's grand quest after free market redemption, where "more and better jobs" will mysteriously arrive by paying people less and making it easier to sack them.

Fortunately, this particular Holy Grail has been kicked a long way out of the Barroso gang's reach after the shredding of the proposed Constitution and the quiet fading of the Bolkestein directive. Our knights of the Round Table are not wholly deterred, however, and with Tony Blair's rallying cries ringing in their ears, Europe's surly and ungrateful peasants can be brow-beaten into submission.

And so another round of hectoring from the UK government to sclerotic, sluggardly European countries to tighten belts is heralded by a flimsy report whose persuasive power relies on the cunning juxtaposition of pretty graphs besides ugly claims.

Take ICT. We all know that the internet is destined to feed the world, clothe the hungry, and rebuild levees. But I bet you didn't know how to use it properly, did you?

The productive and profitable use of ICT requires changes in the organisation, management and the location of activities. Change will involve the entry and exit of firms, the hiring and firing of labour, and the need for more general purpose skills.

To use a term coined by economist Joseph Schumpeter the productive and profitable use of ICT requires "creative destruction". Fundamental change is required to benefit fully from ICT, and greater investment in ICT capital and skills alone in the current European environment would deliver poor returns...

Barriers to the reallocation of labour – including undue restrictions on hiring and firing and impediments to labour mobility – should be lowered. Barriers to the creation and destruction of firms and to market integration should also be lowered in order to allow innovation and "creative destruction" to flourish...

Poor old Joseph Schumpeter. I don't think he was ever so crass as to urge "creative destruction" as a desirable instrument of policy; and yet here we have the headline report of a government-sponsored conference demanding firms be allowed to "reallocate labour" as they see fit, whilst lay-offs and redundancies are presumed to aid "innovation".

The sole empirical basis offered for this is a single graph, purporting to show a negative relationship between "labour-market flexibility" and productivity growth in ICT. We are asked to conclude that more "flexibility" produces more productivity growth. Yet to demonstrate an apparently EU-wide problem, all the countries included - bar one - are within the EU: so where's the standard of comparison? The closest we get is the inclusion of the US, which, sure enough, appears to have high "labour market flexibility" and high productivity growth. If the US is to be included - why not, for instance, also throw in other OECD countries? If the authors' conclusion was correct, it would be reinforced by doing so.

Elsewhere, however, it is grudgingly admitted ICT does not necessarily produce faster growth: "While South Korea has, and continues to have, a rapidly growing economy, a productivity growth acceleration in ICT-using sectors did not occur in the mid 1990s." The IMF working paper (PDF) cited by Indep notes that

...the evidence from the McKinsey Global Institute research on productivity growth in France, Germany and the United States, does not clearly indicate which [labour-market] reforms should be implemented. Take the case of the retail food sector, for instance. McKinsey finds that labor productivity in that sector was actually 7 percent higher in France than in the United States in 2000. In addition, the degree of IT use in that sector was about the same in France, Germany and the United States in 1999, with the United States holding only a small lead...

...it is equally possible to argue that the euro area is only lagging the United States in terms of adoption of ICT technologies in some service sector industries.

But there's more. There's something a little peculiar about all the graphs dragged out to demonstrate how the EU now lags behind the US, how it suffers from chronic unemployment, how generally inflexible and flabby the whole place is. They all show the Atlantic-sized gap emerging in the early 1990s. Unemployment peaked in 1994 and remains higher than the US. Productivity growth falls below the US' in 1993, and remains low.

What's important about these dates is that they occur after the ratification of the Maastricht Treaty and the great strides made then towards a liberalised market across the EU. The rise in unemployment, and the slump in productivity occur precisely during the period in which neoliberalism was making its most determined advance in Europe.

Yet if the Indep report was correct, all this should have lead to declining unemployment and accelerating productivity growth. Instead, quite the opposite took place. After over a decade of receiving the quack medicine peddled by the likes of Indep, ordinary punters across Europe are becoming noticeably irate. How long before the neoliberal doctors pack up?

Floods, pestilence, taxes, etc

Stephen King, "managing director of economics at HSBC", on market failures:

The suffering we're now seeing in the Deep South evokes John Kenneth Galbraith's famous reference to "private affluence, public squalor". If a nation becomes too reliant on the market, and market failures are therefore ignored, the nation's longer-term economic health is potentially compromised...

...some mechanism should be found to ensure that businesses and individuals pay for the social costs of their private actions. If stronger flood defences are a requirement for cities like New Orleans, then those that profit from activity in the region should be made to bear some of the costs. After all, property developers who are given a free rein to invest without making a proper contribution to flood defences are typically long gone before disaster strikes: their profit all too easily comes at the detriment of those who, later on, have to pick up the pieces. There's a need to understand when government has to be involved to help establish the socially-appropriate market price.

Meanwhile, in other news... incidentally, I wonder who the property developers now rushing to build on the UK's flood-plains are borrowing their money from?

New Orleans and "the politics of weather"

Horrible, Biblical scenes from the southern US; combined with a hideous, Wild West approach to property rights. If you've not read them already, China has three excellent posts on Hurricane Katrina at Lenin's Tomb that you need to see (here, here and here). The last, especially: it looks as if IEM, the disaster management "experts" contracted to provide New Orleans' privatised hurricane relief plan are attempting to cover-up their failure to provide anything like a "hurricane relief plan". Or, as China asks, rhetorically, "So, the IEM team's approach isn't to siphon off tax money, spout management shit, provide a demonstrably catastrophically inadequate plan, then fuck off like craven fucking caveworms and hide the evidence when the fucking corpses start piling up?"

If a state government had screwed up this badly, you'd know who to point the finger at. You could perhaps even do something about it: force a resignation, vote someone out of office. But you can bet your last levee that this is exactly the moment at which a grey mist of contracts, sub-clauses and legalese will descend. There's nothing like privatisation for corporate irresponsibility.