Chuck Spinney: Neo-Liberalism Actually Neo-Serfdom

Commerce, Corruption, Government
Chuck Spinney

One of the pillars of the neo-liberal economic policies adopted by Republicans and Democrats alike in the UK and the US is privatization of government services on the theory that free market pressures will generate greater economic efficiencies.  The UK is a case study of how neo-liberal privatization policies promoted by Thatcher, Blair, and Cameron, (and in the US by Reagan, Clinton, Bush II, and maybe Obama) are changing the distribution of economic power.  The attached article by James Meek, which was brought to my attention by my good friend Andrew Cockburn, is a short and not-so-sweet analysis of how the looters in the UK and the US are selling the people into a 21st Century variation of peonage.

Chuck Spinney

Human Revenue Stream 

James Meek, London Review of Books, 20 March 2012

The privatisations are joining up. First it was gas. Then telecoms, oil, electricity, public housing, water, the railways, the airports. There are moves afoot to obliterate the concept of the council house; NHS hospitals are to be privately run, built and managed; now David Cameron wants to get private companies and foreign governments to ‘invest’ in Britain’s roads. What does it all mean? The episodic character of privatisation – one sector being sold, then a pause, then another – has hidden a meta-privatisation that’s passed the halfway point. The essential public good that Margaret Thatcher, Tony Blair and now Cameron sell is not power stations, or trains, or hospitals. It’s the public itself. It’s us.

The commodity that makes water and roads and airports valuable to an investor, foreign or otherwise, is the people who have no choice but to use them. We have no choice but to pay the price the tollkeepers charge. We are a human revenue stream; we are being made tenants in our own land, defined by the string of private fees we pay to exist here. If it’s not obvious that we’re being sold to investors, it’s partly because the idea of privatisation is sold so hard to us, in a way that is hypnotically familiar.

  • First, the denigration of the existing service, as if a universally accepted truth is being voiced: the schools/hospitals/roads are crumbling/failing/ second-class.
  • Then, the rejection of government responsibility: we’ve no money/bureaucrats are incompetent.
  • Finally, the solution: private investment.

And that investment does come, and things get shinier. Surely if the private sector weren’t replacing our old sewers, and won’t replace our old motorways and power stations, we’d need to pay higher taxes instead? The truth is that we already do pay higher taxes. They just aren’t called taxes. Our water supply system is being upgraded because of a huge water tax increase. But it isn’t called that. It’s called ‘the water bill’. As Chris Giles explained yesterday in the FT, water bills have gone up by nearly twice as much as inflation since privatisation. We pay a rail tax: it’s called ‘fare increases’. We pay an energy tax in the form of higher electricity bills, and so on.

By packaging British citizens up and selling them, sector by sector, to investors, the government makes it possible to keep traditional taxes low or even cut them. 

By moving from a system where public services are supported by general taxation to a system where they are supported exclusively by the fees people pay to use them, they move from a system where the rich are obliged to help the poor to a system where the less well-off enable services, like a road network, that the rich get for what is, to them, a trifling sum.

Will there be a revolt?

There was one in the 1990s, on the Isle of Skye. Ostensibly, the private sector was going to build something the people of the island would not have had otherwise: a road bridge to the mainland, replacing the old ferry. The islanders understood what was actually happening. They were being sold as revenue stream. Instead of the bridge being built from a tiny fraction of the government budget, it was built by a private firm, which had been promised that it would be able to gouge the islanders with hefty tolls. Less general tax for British taxpayers: a huge private tax for Skye islanders.

A long campaign of civil disobedience ended in victory for the islanders when in 2004, against the tide of history, the bridge was nationalised. Skye is a small island. Britain is a big one. The plan’s the same. Let’s see what happens.

Phi Beta Iota:  Emphasis added above.

See Also:

We the People Reform Coalition