Backwards or forwards but no stagnation?

Perhaps the leadership election is time for reflections on our party’s aspirations, policies, practices and assessments thereof?

The “Preamble to our Constitution” presents our aspirations. Perhaps it is a statement of the need for and achievability of justice for the individual, the group, the nation and the World?

It could be a compass for the creation and management of policies, policy implementation and their monitoring. We could then monitor the policies of others too. Thus we could develop ourselves as a party of service, information, transparency and reliability.

Preamble paragraph 1 refers to the state’s role in enabling citizens, and, presumably, their children, to flourish, make the most of themselves and be active and positive members of their communities. To achieve this, people need surpluses of time, energy, wealth etc. So this set of apparently social objectives has a large, possibly dominant, component of economics.

The creation, maintenance and distribution of economic and financial power is fundamental to what a society is, and how just.

A useful, stylised analysis of economic and financial power, used by Michael Hudson, has three components – government, the very rich and the rest of us. A combination of any two is stronger than the third. Consequently, it is the duty of our party to gather, and publicise the actual results of every government in representing the “not so very rich”. This need/duty has become increasingly pressing with the imposition of Neoliberalism since 1979 and its continuation by every party since, when in power, if not in opposition.

A consequence, possibly intentionally, of Neoliberalism is the polarisation of wealth. Wealth correlates highly with power which is used to increase wealth further, and so on. It also results in rapid, short-term growth resulting in an exponential increase in human-induced, soon to be catastrophic, climate change; the extensive depletion of key human-need resources such as water and fisheries, and a speculation bubble 50 times larger than the real economy of goods and services.

Our preamble is about people, sustainability and justice for all. Policies and practices to achieve such include the general understanding and application of the following:

  1. The economy is to serve the people, not the reverse.
  2. It is a subsystem of a larger, finite system, the biosphere; hence permanent growth is impossible.
  3. No economy is possible in the absence of biosphere/ecosystem resources and services.
  4. Development is more beneficial than growth and requires not growth.
  5. Development is about people before “stuff”.

(Courtesy “Economics Unmasked”: Smith & Max-Neef)

Assessment of economic performance can be better achieved by publicising an expansion of economic data to include such as:

  1. The number of food banks plus their economic and geographic contexts
  2. Ditto hungry children
  3. The losses in pensions and savings following the 2008 crisis
  4. The number of homeless plus contexts
  5. Ditto the number living on the street

Our preamble has so much to offer: let’s make it more lively!

* Steve Trevathan is chairperson of Lyme Regis and Marshwood Vale Liberal Democrats.

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10 Comments

  • Peter Martin 3rd Sep '20 - 10:36am

    “Development is more beneficial than growth”

    Yes. There is a problem that some growth is necessary to keep our system on track. If the economy stagnates then everything doesn’t just stay the same. Unemployment rises and inequality worsens. Because we live under capitalism, it’s generally considered a flaw in capitalism. But we are always looking to produce the same amount with less effort. To utilise the entire labour force means we have to produce ever more.

    Conceivably this could be a problem under socialism too. The obvious solution is for us all to work shorter hours and have longer holidays. That makes more sense than to pay a percentage of people a supposed UBI to do nothing. Also it should be more popular electorally.

    If you are trying to win an election with, say, 10 voters you could tell everyone they will have to work 10% fewer hours for the same wages, or say that 9 voters will have to work the same hours as before, but pay to support the tenth who doesn’t have to work any longer.

    I’m not sure why most Lib Dems seem to favour the latter.

  • Paul Barker 3rd Sep '20 - 11:36am

    The “Green” argument against growth is based on a fundamental misunderstanding.

    Economic Growth is simply a growth in Value & Value is simply stuff people want enough to deliberately pay for it. Stuff in this case doesnt have to be anything material & more & more it isnt. Most of the stuff being produced in The UK is immaterial.
    Economic Growth does not inevitably generate growth in the demands we put on The Planet.
    An obvious example is Energy _ growth in Energy use is generally lower than Economic growth & growth in the resulting CO2 production is even less as Renewables take an ever larger share.

    The idea of “Zero Growth” is a distraction from all the changes we need to make now.

  • John Marriott 3rd Sep '20 - 12:11pm

    The “Green” argument against growth could be summed up in the slogan I read years ago: “Everyone wants to go back to nature; but nobody wants to go on foot”. Mankind in most parts of the world, seems to be stumbling towards some kind of modus vivendi with the environment. That fact that ALL parts of the world haven’t cottoned on would appear to be the problem.

    Greta Thunberg and her middle class camp followers in the so called Extinction Rebellion Movement need to wise up. You know, for once, and only once, I agreed with Trump, when he advised her to go back to school. Mind you, she can skip English classes as she appears at her young age to have mastered the language already. I wonder what her French or German are like?

  • Peter Martin 3rd Sep '20 - 2:50pm

    @ Paul Barker,

    “Economic Growth does not inevitably generate growth in the demands we put on The Planet.”

    I’m afraid it has and it still does. As you say yourself the increase in CO2 production may not be proportional to GDP but it is still an increasing function of it.

    GDP per person, in the UK, is about £30k per person pa. Just when is enough ever enough? I could just about scrape by on that. Just as a couple with two children should be able to manage on £120k pa. So we do need to be thinking about not pushing those figures to £40k and £160k without good reason.

  • Peter Martin 3rd Sep '20 - 2:56pm

    @ John Marriott,

    “I wonder what her French or German are (sic) like?”

    Probably better than our Swedish and maybe even better than our English! 🙂

  • Steve Trevethan 3rd Sep '20 - 5:25pm

    “China can recover [better], fiscally and financially, from the viral disruption because most debts ultimately are owed to the government-based banking system. Money can be created to finance the material economy, labor and industry, construction and agriculture. When a company is unable to pay its bills and rent, the government doesn’t stand by and let it be closed down and sold at a distressed price to a vulture investor.
    The world — has two options: a basically productive financial system in China, or a predatory financial system in the United States.” [Michael Hudson]
    https://michael-hudson.com/

    Might we be better of following the Chinese model?

  • Peter Martin 4th Sep '20 - 5:59am

    “Might we be better of following the Chinese model?”

    Probably not!

    Yanis Varoufakis is fond of saying that Germany works because there is only one Germany. The same could be said of China. The other countries we are often encouraged to emulate are the Nordic countries: Norway, Sweden, Denmark and Finland. Some would add Korea and Singapore to the list. Japan used to be on it but now their National Debt to has increased to over 250%, they have lost their neoliberal tick of approval.

    So what do they all have in common? The answer is they are all highly mercantalistic and want to game the system to produce large export surpluses for themselves. An influx of export money into their economies, enables them to avoid having to run a significant Govt budget deficit to provide the same money. The neoliberals like that.

    Of course the snag is that we can’t all run export surpluses. The world does need someone to run the trade deficits. The UK has always done its bit in this respect.

    Having said this, Michael Hudson does have a point in criticising what he terms the FIRE economies of the USA and UK. Finance, Insurance, Real Estate. But we can’t all be like Germany and China. This isn’t the solution.

  • Antony Watts 4th Sep '20 - 7:50am

    Boy am I pleased to see Liberal Democrats discussing these issues. I am not going to inject anything. Just hope the debate increases and we come out with a good, definitive policy we can project to the world.

  • Peter Hirst 4th Sep '20 - 5:20pm

    If we stand for anything it must be a sense of what is possible beyond the sad pictures painted by the other two Parties. It must include hope or a dream of an all inclusive society in which every citizen want to and plays its part drawing upon its local and central infrastructure for support as necessary.

  • Steve Trevethan 5th Sep '20 - 4:10pm

    Thanks to all conversationalists!
    PM – Yes, less work, especially “Bullshit Jobs”* would benefit society and the environment provided all had enough to live comfortably. A universal job entitlement as suggested by Stephanie Skel;ton in “The Deficit Myth” seems be possible. [*Interesting book by David Graeber]
    PB – Growth denotes more. Development may or may not?
    JM – Might a leadership promotion emphasis on the actuality that all “economics” is set in contexts which are finite/destroyable help?
    PM- “The neoliberal economic policies of the German Bundesbank and the E. C. B. placed Eurozone economies at the mercy of the unfettered speculation of capital markets, their risky lending [eg. Greece] and their usurious rates of interest.” [The Production of Money: How to Break the Power of Bankers by Ann Pettifor]
    AW – Many thanks!!!
    PH – Agreed! Perhaps we could also stand for having a purpose of achieving such an an all inclusive society?
    P.S. If we could get our leadership to read and use Ann Pettifor’s book, we should be so much better off!
    P. P. S. This book was recommended by a conversationalist in a previous L. D. conversation

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