The stirrings of a 1960’s-sounding popular movement against the status quo is what inspired me to embark on Groundswell. The 999 Call For The NHS grassroots activists in the film share with their dissident forbears an animated hunger for new ways of thinking and speaking on what society should be about.
Last week’s symposium on Modern Monetary Theory (MMT) organised by Deborah Harrington typified this. Australian economist Bill Mitchell, something of a Dr Timothy Leary figure in the MMT world with his surfing and rock music references, talked of the need to change the language and metaphors of popular economics.
Public spending on hospitals, transport etc, funded by Treasury bond loans from the private sector, burdens governments with hefty interest and repayment costs. These are subjected to cosy ‘good housekeeping’ maxims of ‘surpluses’, ‘deficits’ and ‘not living beyond our means’. But the maxims, used by privateers and politicians to justify cuts, austerity and privatisations, are bunk metaphors for bunk concepts according to Mitchell and MMT.
MMT says that governments can actually print as much money as they need without relying on the private sector’s strictures. And without causing massive inflation or the collapse of their currencies, as has been demonstrated in their humongous money printing for bank bailouts and Quantitative Easings.
According to MMT money creation need not be denominated as debt and need not require any return of capital or interest. The debt-based concept of monetary return is a legacy of robber barons owning the lion’s share of a society’s wealth and enhancing it through loaning it out and limiting its supply.
Under MMT money creation would be determined by society’s available resources, such as green energy and especially the unemployed. With its money printing capability government would provide whatever money needed to utilise these resources, free of any interest or repayment liabilities.
The investment and return would be social, an addition to the prosperity of all, with full employment providing healthy consumer demand and a healthy productive sector – the kind of economy that would actually make UK plc and its currency attractive to investors, contrary to what MMT’s detractors claim.
Prices and incomes policies and agreements would keep earnings in line with productivity to curb wage-led inflation. Taxes would be used on earnings and goods to regulate demand-led inflation and to bleed off excess money in circulation. There would be no need to ‘balance the books’ between money created as public debt and returns on it to come from taxes to make good any ‘deficit’.
The other symposium speakers were Ann Pettifor, author of the lucid Just Money, and tax expert Richard Murphy, who is advising the anti-austerity Corbyn camp in the Labour leadership election (see MoneyWeek Magazine ‘What Is QE For The People?’). MMT is music to the ears of those seeking economic arguments to justify a negation of austerity and an expansion of public spending.
Yvette Cooper has decried the Corbynistas’ lack of economic ‘realism’. Yet she and Burnham were among Labour ‘realists’ so successfully ensnared in the City’s smoke and mirrors that they failed to foresee the Crash, despite warnings from capitalist seers like Warren Buffett and William White, chief economist of the Bank Of International Settlements, the overlord of the world’s leading central banks.
Both were supporters of Blair/Brown administrations’ punitively costly Private Finance Initiatives (PFI’s) directed at cutting public spending under the ‘good housekeeping’ rubrics trumpeted by the finance sector’s mouthpiece Thatcher.
Both were advocates of Labour’s NHS ‘Efford’ Bill whose embrace of such ‘realism’ allows for the maintenance of a marketised element in the NHS – thereby leaving the NHS open to continued privatisation under international competition law, including those of the looming EU/US Trade & Investment Partnership (TTIP).
Both have failed to reject other State-owned services and assets like schools, housing, libraries and prisons being subject to TTIP, thereby exposing them too to continued privatisation.
To MMT’ers like Bill Mitchell their ‘realism’ reflects New Labour’s abiding bondage to a discredited free-market ideology still being peddled by Goldman Sachs et al, today’s equivalents of the robber barons of old. They head the global financial sector’s control over money and debt creation. And they’re using that lever to seize lucrative public services and assets, as the Greek bailout deal demonstrates.
Despite his dodgy NHS position Burnham has support among some NHS campaign organisations like the People’s Vote For The NHS. The People’s Vote was formed by ex-999 Callers and Labour Party activists after a rift with Joanna Adams and other 999 colleagues. The latter were insistent on 999 Call For The NHS remaining a non-party campaign group untainted by association with a Labour Party whose City-sugared, watery Election manifesto included Burnham’s leaky NHS ‘Efford’ Bill.
That rift was a symptom of the conflict between “those whose priority is to get the Labour Party elected and those whose priority is to Save Our NHS” pointed up by Lucy Reynolds in Groundswell. This conflict, over “ethics not tactics; principles, not opinion polls!” as Joanna Adams puts it, continues in the leadership election.
The Labour Party had a golden opportunity to turn back the free-market tide offered on a plate to them by the 2008 Crash which so crunchingly discredited the privateers. But its MandelBlairson regime, rooted in Labour’s defeatism of the Thatcher era, disdained the Party’s founding tenets and failed to take it.
Further failure by any coming Labour leadership to properly challenge the financial plutocracy and their colonising of our social and political apparatus, indeed our democracy, is what will doom the Party to years in the wilderness.
Not Corbyn. He, like the Greens, the SNP and indeed the UKIPpers, seems simply part of an expression of deep public disillusionment with that failure. That’s what the 999 Call activists in Groundswell powerfully convey. And that’s what the Party needs to address. Whoever wins the leadership ballot.