‘His political solutions seem so abstract and unworkable’: Thomas Piketty. Photograph: Joel Saget/AFP/Getty Images
To bring a book into the world with 1,065 pages, there has to be a good reason. Thomas Piketty’s reason is that without a detailed account of the ideologies that have sustained inequality in the past, we cannot understand its present form, or how to overcome it.
So Capital and Ideology takes us on a historical grand tour of the hypocrisy of elites, ranging from the punishments meted out to slaves in Mesopotamia to the cruelty of the Belle Époque, which, as French economist Piketty points out, was belle only for a small number of white men.
But the main focus of the book is the present, which is marked by extreme and rising inequality, alongside the breakdown of traditional, class-based politics. The social coalition that drove redistribution in the mid-20th century has disappeared. If we don’t do something radical to reduce inequality, Piketty argues, “xenophobic populism could well triumph at the ballot box and initiate changes that will destroy the global, hypercapitalist digital economy”.
Piketty’s 2014 book Capital in the 21st Century showed how inequality is baked into our current economic model. In a free-market economy, he argues, inequality inevitably rises faster than growth. And as the incomes of the rich become reliant more on asset wealth than salaries, the old forms of redistribution, based on income tax and corporation tax, cease to work.
In this book, Piketty outlines his solution: a “participatory socialism” in which capitalism is gradually abolished via a progressive income tax and a tax on inherited wealth, which are used to finance both a basic income and a “capital endowment” for every citizen.
In a single table, Piketty demonstrates that, in the abstract, it would be possible to finance a radically egalitarian economy if both income tax and inheritance tax for the rich were set around 60-70%. The outcome would be to “make ownership of capital temporary”. Meanwhile, by legislating to enforce power-sharing within firms, between workers and bosses, you could achieve the “true social ownership of capital”.
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The problem, of course, is the resistance of the current elites: the phalanx of Super Pacs in the US, the Brahmin-like permanence of the European centrists, the extreme concentration of power alongside wealth, the evisceration of democracy, the culture of secrecy around the taxes paid by rich people and corporations.
It’s a resistance bolstered by the ideology of what he calls “hypercapitalism”: our willingness to believe billionaires have earned their money, that their philanthropy offsets their greed, that most of the poor are “undeserving”, and that any tinkering with the present distribution of wealth will lead to economic collapse.
As the book demonstrates, the task is further complicated by the breakdown of left-right politics. Piketty makes the case that most electorates are now fractured into four parts: the globalist camp is split between egalitarians and anti-egalitarians, but so is the nativist camp. As a result, any movement for economic equality has to include nativists and globalists, who, as the UK general election showed, currently hate each other’s guts.
If there is a case for optimism in this book, it relies on the incoherence of the hypercapitalist ideology, which promises social mobility to the poorest 50% but repeatedly dumps them at the bottom of the pile.
‘Piketty’s big idea is to tax capitalism out of existence’: an Occupy Wall Street protester, New York, September 2013. Photograph: Emmanuel Dunand/AFP via Getty Images For Piketty, the history of ideologies is autonomous from that of the societies they have been used to justify. Unlike Marx, who wrote that all history “is the history of class struggles”, Piketty believes it is “the history of the struggle of ideologies and the quest for justice”. For the avoidance of doubt, Piketty does not say – as French structuralists did – that ideology is relatively autonomous from the economy: instead he says “the realm of ideas, the political-ideological sphere, is truly autonomous”.
Piketty’s socialism, then, is not just a socialism without the working class. It is a socialism without class struggle, or the need for class struggle. As a result, the intellectual and moral rearmament the left must undergo has to arise out of academia, or the world of thinktanks and NGOs. As for ideologies, they are, in Piketty’s historical scheme, almost never busted open from below, but simply destined to lose their coherence from within.
As he recounts the history of the transition from slave-owning, feudal and colonial societies towards 19th-century modernity, the most consistent actor in the name of progress is the state. By the end of the book, while we have a detailed description of the correlation between forms of inequality and the ideologies used to justify them, there is not a trace of cause and effect. Facts, Piketty states, are untrustworthy because they themselves are socially constructed.
It is as if Piketty, a commanding figure in the economics department, has sauntered across to give a (very long) lecture series in the history department without bothering to engage in the methodological debates that rage there. But his implicit method is that of the Enlightenment philosopher Georg Hegel: human progress exists, the state is nearly always its main actor, and history is driven by supra-historical ideas – above all, the idea of justice.
And that’s what makes his political solutions seem so abstract and unworkable. What happens to the value-creation process in a world where the rich are getting their wealth confiscated and their incomes flattened (ie the actual problem that destroyed the Soviet experiment)? How do you revive the actual democracies we are fighting in other than by giving every citizen a “democracy voucher” to even out political spending by the elite? By the time we get to page 1,027, and Piketty’s design for a world government, we are well and truly down the rabbit hole of bright abstractions.
As for the most pressing problem – how to deal with the rise of nativism and xenophobia among the communities that once voted left – Piketty’s solutions are perfunctory. He rightly slates the French left for becoming “Brahmins” – exclusive representatives of the educated class – and calls for left parties to be less elitist and less hostile to the self-employed.
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But electoral experience – in the UK, the US and France – shows that right-voting workers are strongly wedded to inequality. As Labour found out in December 2019, pledging to tax the rich without mobilising those voters with a narrative of self-liberation can backfire. Only recently, a survey of “red wall” seats found they want “modest tax hikes to make the system fairer but outright reject attempts to take money from the modestly well-off and even from billionaires”.
Piketty is right to say that, in moments of transformation, big ideas come first. His big idea is to tax capitalism out of existence, and it has triggered an avalanche of derision among the Davos-going crowd. My objection is not that it is too radical but, lacking any explanation of which social forces might enact it, not radical enough. Paul Mason is a writer and broadcaster on economics and social justice • Capital and Ideology by Thomas Piketty is published by Harvard University Press (£31.95). To order a copy go to guardianbookshop.com. Free UK p&p over £15
Ombudsman Services Pt. 4: The Full English Cover-Up - (93) Time For A Conversation About The Ombudsman Services' Blueprint For Private So-Called Justice.
Caroline, the pre-Brexit blueprint for private Alternative Dispute Resolution (ADR) was provided by Ombudsman Services:Property. Private justice that was wielded by unaccountable ombudsmen with attendant supine Whitehall civil servants seemingly happy to monitor absolutely nothing. It was all very pro-business.
Ask the government civil servants who monitored this government approved scheme a question and then sit back and wait and wait and wait for the answer that never comes.
They wield the power. We don't and it was ever such.
Take back control? We - the people - never had it in the first place. And it was ever such. Time for a conversation about ombudsmen and their opaque, unaccountable, masonic and Byzantine ways of operating and a public inquiry into RICS "appointed" Ombudsman Services:Property whilst we're at it.
Ombudsman Services Pt 4: The Full English Cover-Up - (92) Brexit Time And Now The People Can Take Back Control Of RICS And Its "Appointed" ADR Scheme OS:Property.
The former CEO and Chief Ombudsman of Ombudsman Services once described the private scheme as being, "a superb model of ADR."
That was before the wheels came off and it careered hopelessly out of control. And so it was quietly closed down. Never to be seen or heard of again. It was all the fault of the system. Nothing whatsoever to do with the maladministration or eye-wateringly illogical decisions that came to typify his stewardship of what was trumpeted as - administrative justice.
The new Chair even blamed complainants for whinging about the injustice they were being forced to swallow.
Mutually Accepted Decisions (MAS) were arrived at in paltry 1-2% of cases. 98-99% of decisions were made by the ombudsman. There was absolutely nothing "mutual" about it. According to: Sharper Teeth: The Consumer Need For Ombudsman Reform, 85% of complainants were "dissatisfied" with the outcome of their case. But the Chair still insisted that some individuals just weren't satisfied with his firm's best efforts.
Now if they'd followed the EU Directive 2011 word for word things might have been different - things might have actually been Good For Consumers and not so Good For Business. But that was never going to be allowed to happen. Capitalism isn't about mutuality. It's about money.
So that was then and this is now and there can be little doubt that we're heading for Boris' Brexit Capitalism - the new BBC.
People taking back control? In their dreams.
Ombudsman Services Pt 4: The Full English Cover-Up - (91) Off To Hell In An Anglo Saxon Cartesian Handcart.
Ambrose, seems to have been so utterly bamboozled by Boris's banana bending Brexit baloney that he's completely failed to spot the top-down Anglo Saxon good for business philosophically bewildering so-called private justice that was dispensed - no fault of Europe - by Ombudsman Services:Property.
A scheme that was so Anglo Saxon and so philosophically superb that it ….. closed down.
A true-blue print for a de-regulated arms-length self-regulating post-Brexit Britain about to be unleashed on Anglo Saxons (and others) still drunk on the euphoria of having taken back control.
Keir Starmer: ‘The free-market model doesn’t work.’
Photograph: Richard Saker/The Observer
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Dear Reader, We're told, Keir Starmer appealed to the Labour left to back his bid for the leadership on Saturday as he denounced the “free-market model” as a failure and backed higher taxes on the wealthiest to pay for better public services. The Ombudsmans61percent Campaign denounced the "free-market model" of ADR (Alternative Dispute Resolution) and the Ombudsman Services:Property version of it 10 years ago. Unfortunately, not a single Labour Party MP was prepared to do anything whatsoever about it. The list of Labour Party politicians we've tried contacting over the years is impressive. Their almost total lack of a response wasn't.
Starmer’s bid for the support of Labour members who previously backed Jeremy Corbyn came amid signs of splits in the grassroots organisation Momentum, after it said it would recommend Rebecca Long Bailey as leader and Angela Rayner as deputy in an internal ballot. We tried raising the issue of what we believe was rigged market redress and consumers being hung out to dry by an OS:Property ombudsman with a habit of "arriving at decisions in an illogical manner" (DJS Research 2008-11) with Rebecca Long Bailey but never got a reply. There was no momentum there.
Speaking in Manchester, Starmer said the party should unite, and “trash” neither the last Labour government nor “the last four years” under Corbyn. But – although describing the 2019 manifesto as “overloaded” – he made clear he would also back a distinctly leftwing economic agenda with the aim of reducing inequality and increasing social justice.
I said as much at meeting called by Luke Pollard MP in Plymouth Guildhall in 2019. I suggested that a Labour Party that wasn't prepared to place economic, social and "justice" justice at the heart of all it did was wasting its time. That a modern, democratic Labour Party should surely be united in campaigning for justice for the victims of an ombudsman left free to dole out decisions that were to all intents and purposes - bonkers. The man wasn't interested.
“We have to be bold enough to say the free-market model doesn’t produce, doesn’t work ... the trickle-down effect didn’t happen,” Starmer told a meeting at the Mechanics’ Institute where the TUC was formed in 1868.
We were bold enough to say to Yvonne Fovargue, the then Labour chair of the All Party Parliamentary Group on Consumer Protection, that the Ombudsman Services:Property's idea of private justice was failing to trickle down to bewildered consumers and that Martin Lewis' "Sharper Teeth: The Consumer Need For Ombudsman Reform" was a whitewash. What was needed were sharper eyes, brains and analysis, She wasn't interested.
“We have to rebuild an economic model that reduces inequality and protects working people.” We need an economic model that reduces inequality and protects everyone. And when that economic model invariably goes wrong what we don't need are arrogant, unaccountable and remarkably dim individuals with stupendous job titles handing out eye-wateringly ludicrous decisions to unprotected vulnerable individuals in search of justice.
Speaking to the Observer, Starmer said that while he accepted that the UK would be leaving the EU at the end of January it was essential that it kept as close a relationship as possible with the European single market and customs union.
For the sake of the growing numbers of innocent victims of economic malpractice a close relationship with EU Directive 2013/11/EU on ADR is essential.
Rebecca Long Bailey. Photograph: Chris McAndrew/UK Parliament
“We are leaving the EU but I do not, however, accept that the fight for a close economic relationship with the EU is over. On the contrary, I think it is more important than ever. And therefore the argument for a customs union and single market alignment is as powerful now as it was before the election.” We sought to raise the issue of Ombudsman Services' strange interpretation of the EU Directive with Dame Helena Kennedy the then Labour Chair of the EU Justice Sub-Committee. She wasn't interested either.
On Monday Starmer, Long Bailey, Lisa Nandy and Jess Phillips will all go through to the next stage of the contest having gained the necessary backing of at least 22 MPs or MEPs. With 63, Starmer has more than double the tally of any of the other candidates. Emily Thornberry and Clive Lewis were still battling to secure the necessary nominations last night.
We tried raising the issue of the injustice of a property ombudsman handing out illogical Final Decisions with all of the above. None of them were interested.
After a meeting of Momentum’s elected steering group, the organisation decided on Saturday to recommend support for Long Bailey in its own ballot of members, arguing that she was “the only viable left candidate who can build on Labour’s socialist agenda, deepen democracy in the party and unite all of Labour’s heartlands at the next election”. The ballot will consist of two questions and will be sent to members on Monday or on Tuesday and will last 48 hours. The move drew immediate criticism from Laura Parker, a leading Momentum member who resigned as national coordinator after the recent election defeat. A socialist agenda that has no room for a fair, transparent, accountable and independent scheme of publicly owned and controlled ADR is pointless. In a democracy surely such a scheme just bloody work - for the victims and not the accused.
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Parker tweeted: “Although I am pleased Momentum’s governing body accepted the principle of balloting its members on the leadership I’m sorry they seem to have decided in advance what the answer is. Members should be able to choose from all Leader & Deputy candidates.”
Which is remarkably like how the Ombudsman Services:Property Ombudsman seemed to operate. We did suggest that the CEO and Chief Ombudsman's self-styled, "superb model of ADR" was a blueprint for the future. sadly that prediction is also coming true.
A Momentum spokesperson said: “We need a new generation of leftwing MPs to lead our party and build on Labour’s popular policy agenda. Our coordinating group believe Rebecca Long Bailey is the only viable candidate who will build on Labour’s vision for the future, deepen democracy in the party and unite all of our heartlands at the next election.” Not if she continues to ignore the corrosive and deeply undemocratic effects of private rigged justice she isn't.
Lisa Nandy won backing last night from over 60 Labour figures, including MPs, peers and council leaders. In a statement they said: “Too many people feel that Labour is unwilling or unable to understand their lives. They no longer believed in our ability to deliver radical change or to protect the things that mattered to them. In order to win back the trust of these communities Labour must listen to them.” Perhaps Lisa Nandy should begin her political journey to the summit by asking her erstwhile colleagues; Luke Pollard, Yvonne Fovargue and Dame Helena Kennedy why each of them saw nothing remotely wrong with a Property Ombudsman handing out illogical decisions if she's really committed to winning back that trust - or is it all just saying the right words at the right time in order to further yet one more political career that's doomed to end in failure?
Starmer added: “We are in the very early days of what will be a long campaign. I am conscious that there are excellent candidates up against me.” Our campaign's taken 10 years so far - perhaps Keir Starmer is the excellent candidate after all. We're sure Keir Hardie would have seen the injustice of rigged "redress" and seized the moment. Yours sincerely, Steve Gilbert - The Ombudsmans61percent Campaign.
