Pubes and crumbs

On the basis that the neo-liberal (or is it Anglo-Saxon?) model of capitalism has crashed and burned the past 20 months, I figured the Left might have something to say about it all. I was wrong. The Fabian society, that venerable centre left lot, have recently published a paper on housing apartheid in Britain, which is very nice give or take the collapse of the housing market. Red Pepper, those fiery mixers of environmentalism and socialism have published some half-decent accounts of why things fecked up, but the main proposal seems to be more legislation supporting credit unions, which is lovely, but still a fringe activity. The New Left Review on the other hand has, as ever, put things in a wonderfully global perspective (1) before tossing one off over the applicability of Marx’s theory of value. I kinda gave up on the Scottish Left Review and who cares what the Socialist Workers are saying. Presumably, it’ll involve some quotes from Imperialism the Highest Stage of Capitalism others from the Grundrisse and Das Kapital combined with a critique of reformism and bobs yer uncle or aunt depending on his or her particular gender orientation.

Shame really. You spend however many years waiting for the inevitable collapse of capitalism and when it arrives you've hee haw to say. Being theoretically inclined or at least someone who likes the odd typology or two, I figure I’ll try and highlight where we are in terms of the politics of it all, the participants and outputs.

Stage 1: This is the “Fucking hell” phase and/or “We must do something!”

This is (was) the initial response to the credit crunch and later on to Lehman Brothers. The key participants at this stage would be Prime Ministers, Chancellors, CEOs and Central Bankers.

In terms of outputs absolutely everything is on the table because the key objective is fire fighting i.e. stopping things collapsing. Hence quantitative easing, part nationalisations and kidding on not cutting benefits equals the rediscovery of Keynesianism.

Stage 2: This is when “We must stop this ever happening again!”

Its also when bank execs, the great and the good e.g. very old, possibly incontinent bank chairman and quango bitches along with the British Bankers Association, senior Treasury civil servants and junior ones who really are on a fast-track, CBI directors, Deputy Central Bankers and terribly senior regulators get involved. All of the bods from stage 1 are still in the frame, but only to receive reports, chair committees and steering groups and intermittently give reassuring speeches/launch papers.

The output here in the first instance is proposal documents, position papers, suggestions and speeches, giving way to more concrete reports setting out strategies and principles after the feedback has rolled in.

Stage 3: This is the intentionally reassuring, almost back to BAU stage because “We are taking care of things”.

Would the Prime Minister be involved? Gordon Brown might be given his apparent temperament (and if he’s still PM), but essentially everything has been handed over to middle and senior managers who, with the aid of wonderfully expensive consultants, have been tasked with putting the outputs of stage 2 into practice. This is when stuff gets set in stone and some poor sod discovers he’s lumbered with implementing various stupid ideas signed off by committees stuffed with terribly, terribly senior bods.


Right now I think we're working thru stage 2. For me January was the tipping point when it came to stage 1. This was when RBS shares fell once again prompting rumours about full-nationalisation, except it eventually became clear it didn’t matter how low RBS shares fell, the government wasn’t for nationalising. Thereafter the sense, felt acutely last year, of waiting for something else to fall over, was lost. No more major institutions it seems will be allowed to fail, not even in the US.

Alongside this and from a British perspective the Bank of England is maintaining a stream of speeches that refer to the new tools needed to combat asset bubbles and the FSA issued a huge document setting out various proposals i.e. they feel able to lift their heads up to outline what they think things will be like after the credit crunch. More importantly, the US just saw Timothy Geithner outline some ideas of what the US re-regulation of financial services will look like, which matters because it sets the benchmark for what everyone else will do (I liked the response of US bank bods to the Geithner proposals reported in the FT “yes, but these are proposals” i.e. piss off.)

All of which brings us back to what the Left has to say that’s of any relevance at this vital stage.……………………….. still waiting ……………………………. anyone any questions or suggestions? No? Shame that as it’s only the re-regulation of a global financial system that’s brought about the worst economic downturn since the great depression. Best just leave it then to the same bankers, regulators, government ministers and civil servants who either caused or facilitated it in the first place.

Actually it’s worse than that. Besides the very real moral, economic and political issues this all raises, it actually impacts on the drivel the left has been churning out in teh meantime. Take the Fabian society’s housing apartheid – if there’s no more cheap credit available for owner occupiers and buy to let investors to actually buy houses and fewer get built, how can this apartheid (what a disgustingly inappropriate use of that term), be addressed? Similarly, new housing regs impose higher environmental standards, so no housing market = less environmentally friendly homes, whaddya think of that then Red Pepper? Or theres PFI/PPP that good old trade union, lefty bugbear that was built on the assumption cheap credit would always be readily available. So should we connect what credit markets will look like in this brave new re-regulated world (heres a clue – more expensive) to debates over whether PFI/PPP will ever pass value for money tests in future (or whether these will simply be flexed to accommodate this?) Ah well.

Hence me stealing a phrase a mate came up with in a completely different context. The pubes are the gits involved in stages 1 and 2 and the left. The crumbs? That’s what the rest of us will be left with at the end of the downturn.


(1) For me Robert Wade’s recent NLR article on things is an honourable exception to this for the most part.