A blog for the socially and politically conscious, written by a young, gay activist who strongly believes in equality and justice.

Friday, 16 April 2010

Who really holds British power?

We are told that we elect representatives to parliament so that they can make decisions on our behalf—but big business still pulls the strings. For the next three weeks there is no government in Britain. Parliament has shut down for the election, and every MP and minister is running around the country desperately trying to shore up their vote. So who’s running the country in the meantime? The answer is the same people who always do.We are told that power in Britain lies in parliament, the cabinet and the office of the prime minister - whether it’s day-to-day politics or a huge emergency, they make the decisions. That’s one reason why people get so angry when MPs are caught spending more time sitting in their million-pound expenses mansions than “running the country”. Some even say that our problems come from the rise of a corrupt “political class”—party apparatchiks more interested in feathering their own nests than serving the people.But the truth about who really runs Britain is even worse. Our real rulers are completely unelected. Once it was the landed aristocracy who held power. Their influence has declined—although many are still filthy rich. But since the industrial revolution, it has been the super-rich—the chief executives, bankers and industrialists—who hold sway. They are the people who own the massive corporations and have the power to make the real, economic decisions that affect all of us.They are the ones who can close down a factory and sack thousands of workers at the stroke of a pen.

A small number of very rich men, and a few women, dominate British companies. Just a few hundred people make the decisions about investment and employment that affect the lives of millions. These are the people who have queued up to sign the Tories’ letter bemoaning Labour’s decision to raise the level of national insurance. In truth they are against all taxes on business—and anything else that drains money away from profits, such as a decent minimum wage or union rights. To take one example—Sir Stuart Rose signed the Tories’ letter. He was appointed executive chairman of Marks & Spencer in June 2008. He is also a non-executive director of Land Securities plc and chairman of Business in the Community. That’s typical of the web of interlocking directorships that produce a powerful “magic circle” of bosses. Nicolas Moreau, another signatory, is the chief executive of Axa UK insurance. He is also a trustee for the Hedge Funds Standards Board Ltd and director of Winterthur Life UK Ltd which “offers wealth management solutions to the high net worth marketplace”. Sir Nigel Rudd also signed the letter. Rudd is the non-executive chairman of BAA, but holds an additional seven posts on boards of big business. These include luxury car dealerships and LLP Capital—a private equity firm.One study of the directors of Britain’s biggest 350 companies showed that six men were each on the board of five companies, and 15 were on the boards of four companies. If smaller companies are included then some businessmen have collected 17 directorships each. These are not only incredibly powerful positions, they are also very well paid. The boss of Xstrata, Mick Davis, grabbed almost £29 million for 2009. Davis is one of the most high- profile supporters of the Tories’ campaign against the government’s increase in national insurance. The Tories say they want the top earners in the public sector to get no more than 20 times as much as the lowest paid. The Guardian newspaper last week found that bosses at ten of the largest companies who backed the Tories on national insurance would have to take a combined £74 million cut to their pay and bonus deals if the same rules applied in the private sector.

As was hazarded on Tuesday, Labour's election manifesto was marginally less toxic than the farrago that the Tories had built up as their offering. And so it has turned out. Toxic terror David Cameron has produced something that is as poisonous as any political manifesto coming out of the Thatcher years and, if it's possible, even more deceitful. Let's give public-sector workers ownership of the services they deliver, says Mr Cameron. But, at the same time, let's freeze their wages. Up and down the country, said he, the Tories have been faced with pleas from the private sector to do their bit. Mind you, according to Mr Cameron, these pleas were framed in terms of "give us more government contracts," so we beg leave to doubt the motives behind them. It would just mean that the rich get richer. And as far as ownership of the services is concerned, the Tory vision of a public sector made up of small private firms and so-called "co-operatives" bidding against each other for contracts in a frantic race for the bottom is merely a formula for a price war on services which could only lead to wholesale cost-cutting and the eventual destruction of those services. Residents will apparently be able to veto council tax increases. Sounds wonderful, doesn't it? That is, until you remember that much of the funding for councils also comes from central government and, should that be cut, you can bet that there won't be any referendums allowed.

In that event, councils would lose any political decision-making powers and would be faced with no choice but to cut services, something which would suit the Tory privatisation agenda very nicely indeed. In fact, it's just a recipe for wholesale demolition of the public sector under the guise of fake "democratisation." Unison general secretary Dave Prentis accurately descibed this as "another ploy to break up public services, plunge them into confusion and then let the private sector pick over their bones. The Tories' plans would create a bureaucratic nightmare," and we can't disagree with him. "We will consult on the introduction of a fair fuel stabiliser. This would cut fuel duty when oil prices rise, and vice versa," continued Mr Cameron. Again, this sounds wonderful, a way forward for cheaper fuel - until a little more thought reveals that it's simply a way for the private sector to control government revenues. Prices rise and, as a result, taxes fall. So it's just a way of cutting taxes and transferring tax revenues into private-sector pockets.

And who's going to replace the lost revenue? The simple answer is... nobody. Revenue will fall and services will therefore be cut as unaffordable. Big company profits are underwritten by tax cuts and the rich just keep getting richer. It's not just on the roads or in the air, either. "We will grant longer, more flexible rail franchises to incentivise private-sector investment," say the Tories. Again the truth is somewhat different. Longer franchises simply mean licences to print even more money and will make it even more difficult to get rid of the incompetents who hold the franchises at the moment. Result? The rich get even richer. Then they move on to corporation tax and, guess what, the Tories are going to reform it. A new Conservative government would cut corporation tax. Surprise, surprise. A giveaway to big business from the Tories. Who would have thought it? It summarises the Tory position marvellously. Demolish the welfare state, wreck the public sector and hand it all over to big business to profit off - oh, and don't tax their profits. And it's all clad in populist fancy dress to make it appeal to the voters. But it's a big, ugly lie which is dressing up the closure of the welfare state as some kind of democratic advance. All it's aimed at is making sure that the rich just keep on getting richer.

No comments: