I read a book recently that made the distinction between capitalism that added value and that which extracted it. The former might be characterised by entrepreneurial types that we can all approve of, doing their best to increase the wealth of the nation, and the latter are identified as hedge fund managers, bankers, landlords and profiteers, who move money round rather than create it – which are increasingly at the end of popular criticism (Mazzucato ‘The Value of Everything’)
I am currently reading Hannah Arendt’s book ‘The Origins of Totalitarianism’. She describes the rise of antisemitism and suggests that wealthy who have power are not threatened if they are perceived to be useful – entrepreneurs may be above criticism, but those with asset wealth, without obvious power, political or social, come in for much more criticism – perhaps the recent calls to ‘tax the rich’ addresses this group. Although lobbying activities might disguise their influence.
Wealthy Jews in the nineteenth century were content to be international deal makers and bankers and failed to develop a political presence to counter negative stereotypes. They also isolated themselves from their own wider community but at the same time they did not fit in with European aristocracies, so they retreated into their families. Can we say the same for the Russian oligarchs today – split off from their country and living a rootless, global existence? Have they made themselves a popular target for sanctions and displeasure? You can also see their vulnerabilities around Putin who has a tendency to put people in jail.
Arendt also discusses Imperialism, defined as the economic colonialism of the rising bourgeoisie, the business owning classes, in the eighteenth century, which sought to expand their wealth abroad when expansion nationally became exhausted. This expansion into other countries was thought to solve the problem of over-saving. Yet the profits from imperialism tended to go back into savings accounts, and were not redistributed to the poor at home or abroad, but accumulated wealth for the middle classes. She worries that international business networks will destroy the nation state which is small enough for democracy to be possible and recognizes the rights of the individual, and bring about world, i.e. totalitarian, government. Businessmen and the aristocracy (the asset rich) have never been fans of the republican call for ‘liberty, equality and fraternity’. Destruction of national democracies hasn’t happened yet but are our polities going that way?
I can’t help but think of the current leadership contest of the Tory Party. It seems that our new PM will be voted in by a small minority of the bourgeoisie, asset rich but mostly retired i.e. unproductive savers, keen to maintain their quality of life and pitiless in the face of great reported hardship. It does not feel very democratic – I don’t get a say, for example. Although neither candidate is very attractive.
Another growing critique is that of international corporations and their poor record of paying tax, often through the wheeze of moving their money around to more favourable tax regimes. Since most of the innovations of modern industry, including pharmaceuticals and information technology, have been seed funded by governments (Mazzucato) why doesn’t the taxpayer get some kind of dividend, much in the same way a shareholder does?
The relationship between business and politics is a fraught one. The use of court Jews by European princes to do trade deals across national borders, led to the rise of the Jewish bankers, such as Rothschild, but it also contributed to antisemitic conspiracy theories which finally led to the Holocaust. Nowadays, corporations have become more savvy and milk the state, foolish enough to sell public utilities for a quick profit and little return. But these sell offs are mostly hidden until lack of investment and management incompetency reveals itself in a crisis such as in the case of the UK water companies and the ongoing drought. Who knew that our water is controlled by foreign investors and hedge funds – as much of the privatised public sector is.
So the race is on. Democracy or totalitarian world government? What would you put your money on?
Walking whilst ill 