Marxists have long since
been conscious of the nature of the state, its industrious defence of the
capitalist class, and its prejudice against working people. But much of the
public are unaware of just how incestuous the capitalists and governments
really are. Will Roche continues with his second in a series of three articles
on monopoly capitalism.
‘Monopoly Capitalism’ I tried to demonstrate
that monopolisation is endemic to a capitalist economy. I showed how economies
of scale lead to ever-larger companies, and to the domination of entire
national economies. Big business has become wealthier and more powerful today
than ever before.
Economic forces are not
the only causes. Political forces are at work too. In this article, I’ll try to
demonstrate how big business infiltrates and controls government, and indeed,
how government has become absorbed into big business.
Marxists have long since
been conscious of the nature of the state, its industrious defence of the
capitalist class, and its prejudice against working people. But much of the
public are unaware of just how incestuous the capitalists and governments
really are.
Corporate domination of
parliament is not a new phenomenon. During the late 1800s, for example, Liberal
Prime Minister Gladstone’s efforts to regulate the rail industry were
obstructed by 132 MPs who held directorships in railway companies. But today,
it takes place on an unprecedented scale.
Money talks
Big business has a big
impact on policy making, not because of the strength of their ideas, but due to
the amount of money they throw at government. The party of big business, the
Conservatives, get the lions share of their funding from rich individuels and
corporations. They recently hit the press for the enormous £5m donated by
millionaire Stuart Wheeler. David Cameron has personally raised more than £5m
for the general election campaign after nearly 100 business people signed up to
a premier club that offers them a private dinner with the Tory leader for an
annual fee of £50,000.
Disgracefully, due to
working class disappointment with policies in office, the Labour party has
become increasingly dependent on big business. Labour originally received 90%
of its funding from the trade unions. Today that figure stands at a mere 30%.
New Labour now gets over 20% of its funding from big business.
Lobbyists for hire
This money has more
strings attached than the Philharmonic Orchestra! It’s often used to secure
exemptions from the rules, to get permits or receive other favours. For
example, Bernie Ecclestone, head of Formula One, donated £1m to New Labour
before the 1997 general election. Almost immediately after a subsequent meeting
between Blair and Ecclestone, the UK ban on tobacco advertising was scrapped.
If you’ve got the money,
you can hire a lobbyist and get your interests represented at the heart of
government – who says we live in a democracy? Most of it takes place behind
closed doors, but the clumsy occasionally get caught.
In 1998, there was the
‘cash for access’ scandal, where lobbyists were being paid by corporations to
secure meetings with ministers. There was the ‘cash for wigs’ scandal in 2001
with Lord Chancellor Irvine. And earlier this year, there was the ‘cash for
influence’ scandal where four Labour Party Life Peers offered to help make
amendments to legislation for £120,000.
Revolving doors
But big business has
gone much further than bribery and lobbying. Capitalists and MPs freely interchange
between government and private firms. This process has become known as the
'revolving door'. Companies are often keen to employ former ministers as they
hold inside information, or influence policy-making, which can advantage a
bidding company.
There was a significant
turnover of ministers in 2007. For example, Patricia Hewitt MP, former Health
Secretary, became Special Consultant to Alliance Boots Ltd. Most prominent,
though, have been former Prime Minister Blair’s new roles as senior adviser to
JP Morgan Chase & Co. and Zurich Financial Services.
Conversely, many
business people have become MPs, accessing classified information and
influencing policy for their industries. For instance, Chairman of British
Airways, Lord Marshall of Knightsbridge, who campaigned against tax on aviation
fuel, is now in charge of Gordon Brown’s energy tax review. Paul Leinster,
Director of Smithkline Beecham, which has polluted streams in Sussex and
Gloucestershire, is now Head of the Environment Agency’s Environmental Protection
Directorate! In 1999, Leinster proposed that companies should be allowed to
monitor their own pollution, and that regulation be redesigned by industry.
Business people can even
temporarily go and work in a minister's office for a couple of years. This is
known as ‘seconding’, and it’s completely legal!
This has had a profound
effect on industry. For instance, it is quite extraordinary the number of
former MPs and ministers who are now working for the nuclear industry. All the
inside pressure has resulted in remarkable about-face in government policy
since 2003, when it announced it was "not going to build a new generation
of nuclear power stations". In 2007, the Government said in contrast that
it would be a "profound mistake" to rule out nuclear power.
The Ministry of Defence
is just as bent. They recently privatised the Defence Evaluation and Research
Agency, built from public money, changed the name to QinetiQ, then sold it off
to the U.S. firm Carlyle, a company currently making a fortune from the
‘reconstruction’ of Iraq. And, guess who’s on the board of Carlye? George Bush,
and John Major. No wonder the company is getting plum contracts!
Public services
The most notable
conquest by big business has been the privatisation of public services, most
notably, the NHS. Over a hundred hospitals have, or are being demolished, and
lucrative contracts are being farmed out to private firms to build a small
number of private hospitals, only to then be leased at great expense back to
the NHS. Private firms have also taken over catering, cleaning and portering.
Big business has
successfully installed its representatives into government. In 1997, the
Confederation of British Industry, a lobbying organisation for big business,
demanded that government’s Private Finance Panel (composed of civil servants)
be scrapped and replaced with a Task Force composed of industry
representatives. It got it. Adrian Montague, a merchant banker who worked on
the privatisation of British Rail, and the Channel Tunnel project, was put in
charge.
In a move that outraged
critics, the government hired Robert Osborne head of Tarmac, one of the major
builders of private financed hospitals, to run the private finance unit at the
Department of Health (DH). How about that for a conflict of interest! By 2007
the DH’s Commercial Directorate had a staff of 190, of whom just eight were
civil servants, the other 182 being recruited from the private sector.
In the past 18 months
over 25,000 jobs have been axed from the NHS, and thousands of hospital beds
lost. One in eight NHS Trusts faces closure. The corporate takeover of the NHS
is well underway.
Planning permission
for sale
Scores of local
authorities, whose task is to represent the public interest, have been swayed
by private companies, who often offer inducements. In Pembury, Kent, Tesco
offered to give £200,000 to the local authority’s park-and-ride scheme and pay
£300,000 for a community centre if it received planning permission for a new
store. Whilst supermarkets were lobbying against the introduction of a new tax
on store car parks, Tesco made a £12m donation to the Millennium Dome. Tesco
subsequently met with John Prescott. Two months later the tax proposal was
scrapped. Much of these plans go ahead despite enormous public protest from local
residents. Many consider this bribery, but government calls it ‘offsite
planning gain’, and it’s completely legal!
No commercial sector is
better represented in than supermarkets. Chain owner, David Sainsbury, who has
donated over £5m to the Labour Party, was a minister for the Department of
Trade and Industry, as it was then called. Until recently, Tesco executives
inhabited no fewer than six government task forces.
The final arbiter of
planning in England is the Secretary of State for Environment, Transport and
the Regions. They’re just as crooked! In 1993, Secretary of State for
Environment John Gummer installed a new division called the Construction
Sponsorship Directorate (CSD), aimed at ‘helping the construction industry’.
This was an organisation designed to lobby against legislation Gummer was in
charge of enforcing! Key positions were occupied by industry reps. This helps
to explain some of their scandalous decisions, such as agreeing to the
construction of Manchester Airport’s second runway. Dismissed as unnecessary by
transport consultants, and deeply unpopular with local people, it destroyed one
of the most stunning landscapes in the northwest of England. More recently, we
have the Heathrow third runway scandal, where the British Airports Authority
got into bed with the Department of Transport. They ran the consultation on its
behalf and were given access to all kinds of confidential information and were
able to fiddle the figures.
International
Corporations dominate
the political arena the world over. In Japan, they call it the iron triangle,
referring to corporations, government and the labour bureaucracy. In India, one
in four election candidates are millionaires. In the USA, George Bush raised a
record breaking $130 million for his 2004 election campaign, donated by the
likes of Pricewaterhouse Coopers, Goldman Sachs and Merrill Lynch & Co.
But, public awareness is
growing. In Britain, according to a survey by the Committee on Standards in
Public Life, 56% believe that half or more of ministers use their power for
their own personal gain. In the USA, 90% now believe big business has too much
power. More significant, is that 20% of Americans believe that socialism is
superior to capitalism, according to the Rasmussen poll. The future of monopoly
capitalism and all its trickery is beginning to look less certain.
In my next article, I’ll
try to debunk the myth that capitalism is efficient, and show the enormous
resources it squanders, and the destruction it causes. I’ll also explain,
surprisingly, why there is a positive side to monopoly business, as I make the
case for socialism.
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