Taming the beast by "consultation"?

Submitted by martin on 22 September, 2010 - 7:10
Cable

Lib-Dem Vince Cable, Business Secretary in the coalition government, has described capitalism as a ravening beast... and proposed to tame it by severe tut-tutting.

"Markets are often irrational or rigged", declared Cable at the Lib Dem conference on 21 September. He will "shine a harsh ligh into the murky world of corporate behaviour...

"Why do directors sometimes forget their wider duties when a fat cheque is waved before them? Capitalism takes no prisoners and kills competition where it can..."

A Lib-Dem explicating Cable's speech to the Guardian added: "Capitalism left to its own devices just creates monopoliies which... inflict severe damage on the economy".

The banks in Britain, for example, are even more dominated by a few giant enterprises than before the 2008 crisis.

HSBC has assets of $2.4 trillion; Barclays, $2.2 trillion; Lloyds, $1.7 trillion.

HSBC's stash of assets exceeds the total foreign exchange reserves of every country in the world bar China. It is 24 times bigger than the UK's foreign exchange reserves, and three times bigger than the eurozone's.

To subdue these gigantic forces of social destruction, Cable proposes... "a major consultation on takeovers and executive pay".

Cable is explicit about not siding with the labour movement, the only social force which has the potential social power to conquer the corporate monsters.

He recently said proudly that he would "not be thrown off course" by trade-union resistance to selling off Royal Mail. "The Labour government capitulated [on privatisation] because of pressures in the labour movement. Well, we are not part of the labour movement".

He opened his speech to Lib-Dem conference by boasting that he had "acquired a fatwa from the revolutionary guards of the trade union movement", as well as annoying the bank bosses.

Cable's vision is one where gallant supervisors like himself stand above the big social classes, and shepherd both workers and big bosses into a harmonised, cleaned-up capitalism.

As policy, it is empty. As empty as the "trust-busting" of US President Theodore Roosevelt at the start of the 20th century, which did break up the Standard Oil combine, only to see it spawn even bigger capitalist giants, like Exxon. As empty as the notions of those who think they can deal with global capitalism by withdrawing Britain from the European Union.

Capitalism is a system with its own logic of the strong killing the weak and the big eating up the small. Consultations and government regulations will never break that logic, if only because the big capitalists remain the dominant influence on the consulters and regulators.

The logic of capitalism can be combatted effectively only by basing ourselves on the counter-force created by capitalism itself, within capitalism itself - the working class.

The labour movement must mobilise to adapt economic life to human goals, to assert human control against the control of the profit-crazed capitalist giants, by way of a workers' government.


Cable's stance is the populist trimming to a policy trend in capitalist governments across the world since the acute financial crisis of 2008.

Despite much talk and many promises at the time, those governments are sticking to neo-liberalism. The banks have talked down the once-threatened tighter government regulation of their business to minimal levels.

In early September the world's central banks agreed on a new set of international banking regulations, "Basel III".

The new regulations call for banks to keep a bigger stash of capital assets to underpin their deals.

But it is no bigger than most major banks already have, just to reassure the people they deal with. And, while the government tells us that cuts must come immediately, the banks have nine years' grace before the new regulations come into full force.

By that time, of course, financiers will have worked out a hundred new ways to get round those regulations.

As John Authers sums up in the Financial Times, "the world's financial regulation has changed less than predicted... An unrepeatable opportunity to make the world's financial system safer has been missed".


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