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December 8, 2014

There Is An Alternative

The great political question of our age is what to do about corporate power. It’s time
we answered it.

By George Monbiot


Does this sometimes feel like a country under enemy occupation? Do you wonder why
the demands of so much of the electorate seldom translate into policy? Why the
Labour Party, like other former parties of the left, seems incapable of offering
effective opposition to market fundamentalism, let alone proposing coherent
alternatives? Do you wonder why those who want a kind and decent and just world, in
which both human beings and other living creatures are protected, so often appear to
find themselves confronting the entire political establishment?

If so, you have already encountered corporate power. It is the corrupting influence
that prevents parties from connecting with the public, distorts spending and tax
decisions and limits the scope of democracy. It helps to explain the otherwise
inexplicable: the creeping privatisation of health and education, hated by almost all
voters; the private finance initiative, which has left public services with unpayable
debts(1,2); the replacement of the civil service with companies distinguished only by
their incompetence(3); the failure to re-regulate the banks and to collect tax; the war
on the natural world; the scrapping of the safeguards that protect us from exploitation;
above all the severe limitation of political choice in a nation crying out for alternatives.

There are many ways in which it operates, but perhaps the most obvious is through
our unreformed political funding system, which permits big business and
multimillionaires effectively to buy political parties. Once a party is obliged to them, it
needs little reminder of where its interests lie. Fear and favour rule.

And if they fail? Well, there are other means. Before the last election, a radical
firebrand said this about the lobbying industry(4): “It is the next big scandal waiting to
happen … an issue that exposes the far-too-cosy relationship between politics,
government, business and money. … secret corporate lobbying, like the expenses
scandal, goes to the heart of why people are so fed up with politics.” That, of course,
was David Cameron, and he’s since ensured that the scandal continues. His lobbying
act restricts the activities of charities and trade unions, but imposes no meaningful
restraint on corporations(5).

Ministers and civil servants know that if they keep faith with corporations while in office
they will be assured of lucrative directorships in retirement. Dave Hartnett, who, as
head of the government’s tax collection agency HMRC, oversaw some highly
controversial deals with companies like Vodafone and Goldman Sachs(6,7),
apparently excusing them from much of the tax they seemed to owe, now works for
Deloitte, which advises companies like Vodafone on their tax affairs(8). As head of
HMRC he met one Deloitte partner 48 times(9).

Corporations have also been empowered by the globalisation of decision-making. As
powers but not representation shift to the global level, multinational business and its
lobbyists fill the political gap. When everything has been globalised except our
consent, we are vulnerable to decisions made outside the democratic sphere.

The key political question of our age, by which you can judge the intent of all political
parties, is what to do about corporate power. This is the question, perennially
neglected within both politics and the media, that this week’s series of articles will
attempt to address. I think there are some obvious first steps.

A sound political funding system would be based on membership fees. Each party
would be able to charge the same fixed fee for annual membership (perhaps £30 or
£50). It would receive matching funding from the state as a multiple of its membership
receipts. No other sources of income would be permitted. As well as getting the dirty
money out of politics, this would force political parties to reconnect with the people, to
raise their membership. It will cost less than the money wasted on corporate welfare
every day.

All lobbying should be transparent. Any meeting between those who are paid to
influence opinion (this could include political commentators like myself) and ministers,
advisers or civil servants in government should be recorded, and the transcript made
publicly available. The corporate lobby groups that pose as thinktanks should be
obliged to reveal who funds them before appearing on the broadcast media(10,11),
and if the identity of one of their funders is relevant to the issue they are discussing, it
should be mentioned on air.

Any company supplying public services would be subject to freedom of information
laws (there would be an exception for matters deemed commercially confidential by
the information commissioner). Gagging contracts would be made illegal, in the
private as well as the public sector (with the same exemption for commercial
confidentiality). Ministers and top officials should be forbidden from taking jobs in the
sectors they were charged with regulating.

But we should also think of digging deeper. Is it not time we reviewed the remarkable
gift we have granted to companies in the form of limited liability? It socialises the risks
which would otherwise be carried by a company’s owners and directors, exempting
them from the costs of the debts they incur or the disasters they cause, and
encouraging them to engage in the kind of reckless behaviour that caused the
financial crisis. Should the wealthy authors of the crisis, like Fred Goodwin or Matt
Ridley, not have incurred a financial penalty of their own?

We should look at how we might democratise the undemocratic institutions of global
governance, as I outlined in my book The Age of Consent(12). This could involve the
dismantling of the World Bank and the IMF, which are governed without a semblance
of democracy, and cause more crises than they solve, and their replacement with a
body rather like the international clearing union designed by John Maynard Keynes in
the 1940s, whose purpose was to prevent excessive trade surpluses and deficits from
forming, and therefore international debt from accumulating.

Instead of treaties brokered in opaque meetings between diplomats and transnational
capital (of the kind now working towards a Transatlantic Trade and Investment
partnership), which threaten democracy, the sovereignty of parliaments and the
principle of equality before the law, we should demand a set of global fair trade rules,
to which multinational companies would be subject, losing their licence to trade if they
break them. Above all perhaps, we need a directly elected world parliament, whose
purpose would be to hold other global bodies to account. In other words, instead of
only responding to an agenda set by corporations, we must propose an agenda of
our own.

This is not only about politicians, it is also about us. Corporate power has shut down
our imagination, persuading us that there is no alternative to market fundamentalism,
and that “market” is a reasonable description of a state-endorsed corporate oligarchy.
We have been persuaded that we have power only as consumers, that citizenship is
an anachronism, that changing the world is either impossible or best effected by
buying a different brand of biscuits.

Corporate power now lives within us. Confronting it means shaking off the manacles it
has imposed on our minds.