To Forge A New, More Egalitarian World, Our Economy Needs An ‘Enlightenment 2.0’
Our market fundamentalist system is failing vast numbers of people – and the Conservatives do not have solutions to the problems of Conservatism
For 40 years Britain has been in thrall to Austrian economist Friedrich Hayek’s ideology of ‘market fundamentalism’. Formulated at the height of the Second World War, and introduced here by his adoring disciple, Margaret Thatcher, it has shaped political and economic decision-making since the 1980s and been at the centre of a global experiment which has gone disastrously wrong. Hayek championed a narrow view of liberty, believing that collective action and democratic socialism took us on “the road to serfdom”. He insisted that ‘freeing’ markets in all spheres of society was the path to true liberty. And it was Hayek who urged Thatcher to crush the trade unions he hated, and to ‘free’ the labour market from regulation, believing weaker worker rights and job security would discipline people to work harder for less reward.
In Britain, the pursuit of these beliefs over the past forty years has shredded our post-war social settlement and created a society where collective endeavour, solidarity and fellow feeling have been discouraged, instead replaced by a coruscating selfish indifference to the suffering of our fellow human beings. This ideology led directly to the smouldering ruins of Grenfell Tower, the scandal of the Home Office’s treatment of the Windrush generation and the DWP’s deliberate demonisation of those with disabilities. But, as we show in our just published book, The New Serfdom, the market fundamentalist system is now failing vast and increasing numbers of people, and this failure has accelerated since the banking crisis.
Home ownership, secure employment and fair wages seem like relics of a bygone era. Meanwhile exploitative workplace practices have created a new serfdom leaving many people trapped in unfulfilling, underpaid work with no escape route. Even Theresa May recognises the anger this has created; she now claims she isn’t a laissez faire Conservative and that the state has a role. But as we saw with Carillion, her inaction speaks louder than her words. The truth is that the Conservatives do not have solutions to the problems of Conservatism. The only way out of this mess is a revival of the ideas and values of democratic socialism, making it fit to meet the formidable challenges of the 21st Century. Our values of equality, democracy, liberty, co-operation and internationalism must be at the core of the battle to forge a better, more caring society.
To do so, we will need to replace Hayekian market fundamentalism with a more realistic analytical base than the selfish, profit-maximising, all-knowing ‘economic man’ so beloved of orthodox economic theory. We need a more holistic economics, which values human emotions like hope, happiness and self-esteem, which recognises the finite nature of the world’s resources, and that the economic system exists to serve human society and the natural world, not the other way around.
By ending the narrow utilitarianism of modern economics, we can develop more holistic approaches. The idea that markets are natural, rational and exist separately to the society in which they are embedded is one of the most damaging ideas to emerge in recent years. Markets reflect political decision-making and priorities, not natural law. If we want a fairer country, we need to take back control from markets and reassert moral choices that reflect the values common to the Enlightenment and the core of democratic socialism: liberty, solidarity and equality.
Without the commitment to reason, facts and the scientific method, it would have been impossible for democratic systems to develop once God and the King had been demoted from the top of a rigid hierarchy of rule. But reason is under threat in an era of emotion and “alternative facts” wielded by populists and demagogues and distributed through unmediated social media. One American strategist typified this new mood recently by asserting “you can’t bring reason to a feelings fight” but he’s wrong. You can’t defeat hot gut feelings spewed by one side with the same by another. We need to end the marketisation of politics which views elections as a retail-based brand war and treats voters as passive observers rather than active participants, while technocrats operating to market rules ensure that nothing important changes whatever the result of the election. To do so, we must fundamentally recast the way we do politics by returning to Enlightenment values. But we will need to go further. Part of the reason the Enlightenment is under threat and that we argue we need an Enlightenment 2.0 is because the original was flawed and incomplete.
This article first appeared in the Huffington Post here.
Women were explicitly excluded from political power at the height of the French Revolution by French revolutionary ministers, prompting an outraged Mary Wollstonecraft to write A Vindication Of The Rights Of Women as an angry riposte. The philosopher Martha Nussbaum argues compellingly for the incorporation of compassion and hope in our politics and believes that the insights of feminism are essential to completing the Enlightenment. She’s right. Compassion is necessary to build social justice and solidarity. It stands in marked contrast to the “self-regarding individualism” (a posh term for greed) which motivates market fundamentalism and has led to social atomisation and political alienation. And it would also help cool the increasingly hyperbolic, hyper-emotional, fact-free and expert-hating politics that drove Trump and Brexit.
A new more egalitarian world remains to be forged. We can start by reviving and completing the Enlightenment. We need a new world outlook which is based on respect for reason and the facts but which accepts difference and pluralism whist striving for inclusion. It is only by completing the Enlightenment, forging a more holistic economics, reclaiming the right of politicians to make moral choices, and working together that we can and will forge a better, more sustainable and secure future for all.