A blog in four parts by Paul Kennedy: MMU Visiting Research Fellow and formally Reader in Sociology – with Kevin Albertson
Part 3. Follow the money
In last week’s blog we considered the topic of motivations and their role in social institutions, including the market. In the following we assess who are the winners and who are the losers from financial crises of the type which began in 2007/8. It hardly needs to be said, if those who suffer most from such crises have no hand in bringing them about, and if those who do bring such crises about do not suffer the consequences, there is no incentive mechanism which can prevent such crises recurring in the future.
The advantaged and the disadvantaged
One of the most inexplicable policies peddled by Neoliberal governments, and especially by the UK Coalition government since 2010, has been to heap opprobrium on to the poorest and most vulnerable groups in our society. These are people who, even a brief moment’s consideration would show, are clearly incapable of bringing down the world financial system – they simply do not have the resources. And certainly, they do not have the motivation.
While blame is heaped on the blameless who are in no way responsible for macro financial problems or the current crisis, the “masters of the universe”, those who clearly do have the power to do much good, or cause much ill, face little more than a modicum of re-regulation and the need to attend a few committees. To be fair, the crisis might have been less severe had not the government hurried to bail out the banks and return them to business as usual. Conversely, in Iceland, as the IMF has noted, the recovery was rapid as the government and the IMF sought to “ensure that the restructuring of the banks would not require Icelandic taxpayers to shoulder excessive private sector losses”.
Conversely, in Neoliberal economies, the austerity policies ostensibly imposed to cope with the government deficits which resulted from bank bail-outs in 2008 have become a vehicle for furthering policies designed to shrink the state and punish the poor for their (supposed) entrepreneurial incompetence and need for welfare compensation. Worse, with the assistance of an often vicious tabloid press, those same disadvantaged people have been persuaded to turn on each other or on those living next door who are even more disadvantaged than themselves: the low paid worker in receipt of tax credits and housing benefits, for example, blaming the disabled person down the street or those currently without any work at all for the nation’s deficit and economic malaise.
Entrepreneurs of the self
The rationale for this apportioning of blame on those who have not succeeded arises from the Neoliberal insistence that all individuals can and must all become entrepreneurs in control of our lives and destinies through the miracles of the market. This allows those who succeed to take sole-credit for their success (in some cases at least, success has rather resulted from their parents income, social contacts and their private school education). Similarly those who are less successful must take the blame for their own predicament – their laziness, or lacklustre success at school, unhealthy living style or wrong choices concerning work opportunities are clearly to blame for their poverty and work insecurity.
Those who allowed themselves to be persuaded by the self-entrepreneurship argument not only feel that they are entirely responsible for their own situation but also that there is no reason to help the vulnerable; given the market has promoted an abundance of wealth, if some have chosen to turn away (for whatever reason – who can guess at individual motivations), well, they ought to endure deprivation to incentivise better decision making in future. Such an attitude legitimises a reduction or removal of the welfare help previously available. This is mean and uncharitable in any country, but especially so in one whose values – so we are given to understand – are solidly Christian.
Even if everyone struggled with every resource available to them to seek the golden path of self-entrepreneurship most would ‘fail’ in relative terms simply because the rewards available, top jobs and salaries, are few. In the UK two-thirds of all families require state benefits of some form, yet it is not possible for everyone to be in the top one-third.
It hardly needs saying, not everyone is capable of gaining a doctorate in advanced mathematics or running a four-minute mile. Even if they were, there would still be winners and losers given the shortage of prizes (some people can run a four-minute mile faster than others). This is the nature of competition. In business, as in sport or any arena where people are pitted against each other, the ‘success’ of some requires the ‘failure’ of the many. This might be a valid model for business, Neoliberalism asks us to accept this is a valid model for our society.
Winners and regular people
Those who do not win this incessant competition – those who are made redundant, who are only eligible for the lowest paid wages or the most insecure working conditions, whose qualifications are a fraction lower than their peers and who therefore do not gain promotion – are not to blame for their relative lack of success. The system itself guarantees the creation of a pool of those who miss out. Most of them have done no wrong, committed no crime; they are simply the casualties of a competitive system they did not create or desire and from which they cannot escape, especially in today’s world of expensive technology, ever higher skill level requirements, vast corporate monopolies and global markets. Certainly, they should not be punished or belittled for providing the minor characters and stage props – as competitors, workers, consumers and taxpayers – who make it possible for the entrepreneurial ‘winners’ to action their ‘superiority’.
In any case, the inherent arbitrariness of the competition ‘game’ and the vast unavoidable inequalities between the players – inequalities that both predate its onset and are created by it – means it is hardly surprising that many of the most deprived people in the play conclude that, since they can never win or benefit very much, there is no point in striving. If they do struggle to participate they will have to accept the likely humiliation of failure, the perception of being someone who lacks merit, who is despised and who has no choice but to pick up the scraps lying under the table.
We are fortunate that the billions across the world who find themselves in such a position do not respond with greater anger and violence and/or by channelling their insecurities and frustrations into criminal activity on a greater scale than they already do.
To be continued …
In the ultimate part of our episodic blog, we ponder the fetish for privatisation which generally is apparent in those nations which adopt Neoliberal dogma.
Please note that blog posts do not necessarily represent the views of other authors on the blog or of the Manchester Metropolitan University