I’VE GOT PAST the stage where each Saturday I cast the loss-making, tax-dodging Guardian (and on Sunday its sister rag, The Observer), into the nethermost regions of the living room and wonder how supposedly intelligent people can come up with such scintillating stupidity week after week. Now I just regard it as light entertainment of a politically incorrect kind – it’s like going to watch the inmates of Bedlam back in the eighteenth century. It’s stupid, really, since I’m paying for the privilege of being treated by the inmates as if I’m the idiot.
So this is my usual modus operandi when reading the likes of Deborah Orr in the Guardian. Here she is berating capitalism for its failings (“It’s time for a better sort of capitalism – one that creates jobs and provides security”):
It is time now for capitalism to start doing all the things it claimed to do. Like providing jobs. Like offering a fair day’s pay for a fair day’s work. Like standing against protectionist monopolies. Like increasing prosperity and raising standards of living for all. Like providing the foundations of long-term stability instead of the conditions for short-lived booms. Capitalism, in the late 20th century, became a monster. Its idols were people who took over other companies, destroying jobs, value, security and fairness as they made profits for themselves and their shareholders. The results are now hideously apparent. But what can – and hopefully will – emerge from the rubble is a capitalism that creates jobs, creates value, provides security and promotes fairness; the civil and civilised capitalism that was always promised, but never with the smallest modicum of real commitment or sincerity.
I don’t think there’s one correct statement in that paragraph, but if you wanted a succinct summary of everything that’s wrong with the socialist view of business reality, you couldn’t do better than this. I’m using the word “socialist”, by the way, since that’s what it is, despite the fact that it’s been banished from public discourse since the Blair days. A leech remains a bloodsucker whatever you call it.
First of all “capitalism” is not an ideological system that can be imposed on society – like socialism. It has advocates but no authoritative voices directing or trying to direct thought and policy, in the way that a political system does. Neither does it have a clear universal structure or hierarchy, like the Catholic church, for example. It has no programme or manifesto, so to say it has to start acting in different ways is a nonsense. You can’t point your finger at it, like a school teacher, and demand it share its sweets out more fairly.
Capitalism has never “promised” to do anything. Its advocates have, most definitely, recited the benefits that accrue as a result of its actions, which include employment, rising living standards, and so on, but they do so for a number of reasons, not least to convince politicians and public that their work is vital to society. Businesses will dangle the prospect of “jobs” in front of councillors and governments if they think it will wangle them a better deal but you’d have to be stupid to think that providing employment is their main concern.
As for living standards, only the most historically ignorant would deny that it hasn’t raised them. Unfortunately it doesn’t stop the whingers in the comments section from claiming they’ve suddenly found themselves back in Dickensian Britain. It would help if they’d read Dickens, of course.
Crucially, however, the purpose of capitalism is simple and easy to understand – obviously too easy for the sophisticated minds of Orr and her ilk: it’s to make profits for the shareholders and business owners. In order to do that a business has to sell its customers something they want at the price they are willing to pay. That’s a win-win relationship: the producer gets a profit, the buyer gets value for their money. If a business fails to do that, it fails, full stop. All other benefits to employees, individuals, “communities” and society at large are incidental. Those benefits can be profound, but they remain incidental nonetheless.
That’s what really irritates the hell out of the left – the fact that the benefits are not planned, for the socialist mindset is nothing if not that of a central planner, obsessed with tidying and controlling everything in sight. Individual freedom and the existence of uncertainty are nightmares to these people and the idea of someone making a profit sends them into frenzy.
Orr encapsulates in this single paragraph a core misunderstanding of capitalism. She thinks it’s about creating jobs, “fairness”, security, etc. It’s not. She thinks that failure and collapse can be avoided. They cannot. They’re as much a part of the capitalist process as success (one reason the banks should have been allowed to collapse). She claims capitalism has destroyed “value” at the same time as it was creating profits (ie “value”) for shareholders. Does she really know what she’s talking about?
What she is really describing is a socialist’s dream version of reality: a world in which pleasant, community-minded business people (perhaps a bit like that nice Mr Branson) settle for small profits or no profits at all so that us poor Cratchits can have jobs for life and plenty of cash whether we’re producing stuff people want or not; irrespective of competition from other businesses who may be providing better services at cheaper prices.
It’s a world governed by an increasingly hysterical Health and Safety mentality, a vision of the country run primarily as a welfare state sustained by a capitalism with its heart removed. You can see why only the inmates of a madhouse would think that’s desirable. Particularly when they’re working for a paper that’s losing customers and cash.