There were many reports yesterday on Extinction Rebellion's (XR's) occupation of a part of Covent Garden to protest about the role of the City of London in creating climate emissions. As a result a couple of journalists called me. I cannot comment for XR, and it is certainly not my job to do so.
What the journalist told me was that they were confused. They got the XR demand that investment in fossil fuel should stop, because it is easy to understand why this should be the case. But, they were concerned that this demand was wrapped up in what they thought to be anti-capitalist rhetoric which they did not think help the XR cause unless it was unwrapped in a way that people could understand and relate to. I stress, they did not appear antagonistic in the way that they were approaching the issue.
If that is the case, although I have no role in XR, except by knowing some of those involved, I think it appropriate to suggest what I think protesters might be saying about capitalism if they want to reach the very large audience who share their concern about climate change.
What XR are correctly highlighting, in my opinion, is the fact that we have for the last 40 years had a form of capitalism that promotes the making of profit above all other considerations when directors manage the affairs of the companies which, very largely, meet our needs for goods and services that are only supplied within commercial marketplaces. I would entirely agree with XR that this priority is wrong.
Saying so, I am not suggesting that profit is, necessarily, a bad thing. If profit is understood in the way that classical and most neoclassical economists thought about it then it is a return to enterprise, which is the human endeavour that is used to create a business. In a very real sense that is a special form of labour.
But, what we actually have seen that is described as profit in recent decades is something that is very different. The neoliberal era has highlighted the making of profit from exploitation.
Initially that exploitation was of labour. So, we saw unions broken. Then we saw outsourcing, and the suppression of wages as a consequence. After that we have had the gig economy, and so on. The result has been that the share of wages within total national income has fallen significantly. When once that share was well over 60%, it now only just makes up 50% of GDP. The shift of reward from labour to capital has been enormous. No wonder so many people feel that they are not better off despite the supposed growth in the economy. They are right. They have been conned. Their labour has been captured by others who have taken the rewards for themselves.
XR, however, concentrate upon another form of capture. That is the exploitation of the natural resources of the planet to make what is called profit, but which is actually rent.
Most of us are familiar with the idea of rent as a periodic payment to someone who owns an asset, such as a house or building, for its use. This, though, is a very limited understanding of what rent means in economics, although it does provide an insight into the issue of concern.
If the rent referred to is of land, then that part which accrues to the land itself, rather than to its improvement by placing a building upon it, is a description of a pure surplus arising to the owner of that land which they have done nothing to earn, apart from acquiring it is property to which they can claim title. The person making payment for that land is, then, simply paying a reward for scarcity to someone who has done nothing to earn it. Of course, the land gets no share of that return. As a consequence this is an example of what is properly called economic rent.
Economic rent is a payment made for use of resource which is not necessary to incentivise its production. That rent has nothing to do with the production process as a result. It is, instead, a simple return paid because there is no other way to access the resource. The control of access is then, the basis for charging that economic rent.
And that is the basis on which so much of the economy has been organised over the last forty or so years. Resources within ever larger parts of the economy have been made scarce either by restricting ownership to small groups in society or by creating artificial barriers around patents come with copyrights and trademarks, many of which have been located in tax havens. The resulting surpluses have been called profit, but they have actually been economic rent charged to most in society, which is why the labour share of the economy has fallen and most people feel worse off
Simultaneously, labour has had its return reduced by increasing its availability, and by reducing its power to organise. The aim has been to reduce its scarcity.
So, one the basis of this analysis what should XR be saying?
I suggest that the message should not be that it is opposed to capitalism per se. What it should be is that XR opposed to a form of capitalism that is built on the basis of the exploitation of natural resources for the benefit of a few at cost to the many in society who are at risk as a consequence. And what it wants is that this exploitation be brought to account.
This last point is particularly important if the target for action is the City of London. There is no analysis in existing accounting that shows the amount of profit that a company makes that arises as a consequence of its exploitation of natural resource. We simply do not know what that number is.
Nor do we, come to that, as a consequence know what is a fair reward to those who run these businesses for the entrepreneurial effort that they might expand on its behalf, over and above that part of their payment which is simply due as a wage for their labour expended. Without a record of economic rents it is impossible to know what that true sum should be.
What is more, no one is trying within accounting to find out what this proper split of reward is.
And, as yet, accounting is resisting calls to be accountable for this use of natural resources. The method of climate accounting that the International Financial Reporting Standards Foundation and the Task Force on Climate-related Financial Disclosures are proposing are simply measures of emissions. This data they treat as something of curiosity to be kept outside the financial accounting framework, meaning that it does not impact on profit, or the estimation of economic rent that is implicit within their definition of profit. As a consequence, there is nothing in their accounting methodology that requires a process of change to end this exploitation.
What is not happening is what I am calling for, which is a form of accounting that requires the elimination of carbon and other greenhouse gas production within large companies. This is what sustainable cost accounting (SCA) does.
If we see the reaction to climate change as a four-part process, starting with denial and then moving through the stages of recognition, measurement, and reaction, it is fair to say that the vast majority of the population are beyond the denial stage. Most have now reached the point of recognising that climate change is significant. But few do as yet, as an FT article yesterday recognised, think that the measurement of climate change is resulting in any meaningful reaction to the issues of concern.
What XR quite reasonably want is that reaction. This is also precisely what is being denied to them, and all the rest of us. In order to keep the system of economic rent extraction in place there is a denial of the need for that reaction, and effort is instead being put into improving the measures of climate change, without recognising the need to respond as a consequence. I suggest that this is a precise and fair definition of exactly where accounting for this issue now is.
So, what could XR ask for? If they took a demand for SCA to the City of London and said this is what they wanted they would have an argument to sit down at the table with. They would not appear to be anti-capitalist. What they would appear to be would be people with a plan for the private sector is to survive within the economy that we must have if the planet is in turn to continue to support human life.
I am, of course, aware that I am promoting my own ideas here. But then, the last time there were major anti-City protests in 2010 the Occupy movement ended up adopting tax justice demands as its main call, and many of those were based on my work. The reason for that is that I believe in solution focussed demands. In other words, I believe that the best protest is not against something, but is instead ultimately for a better solution to a problem that is widely recognised.
SCA is about the reaction stage of that four-part journey to tackling climate change. It requires that companies change, that rent extraction end and that a world that can survive be created based on businesses that can live within the constraints of this planet. That is why I think it meets needs, including that which XR have if they are to move from the current important negative (stop fossil fuel investment) to the positive (what are we going to do about it?). As ever, I live in hope.
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The founder of Extinction Rebellion Dr Gail Bradbrook said she drives a diesel car!!..she needs to use the car to take her children to rugby and football matches because there are no available buses near her home on a Sunday.
Says it all really for the hypocrisy of so many attached to this movement
No it does not
Continuing to drive a car until it is life expired is a green thing to do
Why not discuss facts rather than the drivel that seems to preoccupy the minds of people like you?
Instead of criticising Dr Gail Bradbrook, why not criticise Maragret Thatcher’s criminal (used advisedly) destruction of a passenger-oriented and passenger-friendly bus service that has marooned many in rural, and even some urban, areas, all in favour of what turned out to be the non-existent “magic hand” of market forces?
When Thatcher implemented her dogmatic attack on passenger-focused public transport, as I recall there were several bus companies “competing” for passengers up and down Darlington’s main shopping area, while outlying villages were denuded of services.
And to compound the evil (again, used advisedly) of her dogmatic attack on the travelling public, she actually, I believe, legislated to prevent local authorities from setting up their own, more reasonably priced, and passenger-defined, services – a policy that can only be described as sacrificing the public on the altar of neoliberal dogma.
If local authorities could run cheap, regular bus services on routes the public had indicated to their Council were the services they wanted, not only would Dr Bradbrook almost certainly have been able to leave her diesel car at home.
Additionally, the services she, and other passengers, would have had available would actually, in all likelihood, have genuinely been the product of the genuine (not hypothetical) ‘market’, of voters telling their representatives what they wanted and needed, and having it provided locally, by a genuine local business, rather than by the 4 +/- big companies that have swallowed up all the smaller fry. (NB: I was stunned to see, when I visited my Czech in-laws in 2017, buses with the Arriva logo on them in northern Moravia!!)
The small fry, of course, went to the wall, when there were multiple companies vying for a limited number of passengers that could have been more than adequately catered for by a cheaper, democratically accountable local service.
Agreed Andrew
Spot on
But I’d also add that Gail is not wrong to have a diesel car if a car she must have. Scrapping all existing cars when there is still a need for transport is not green: a transition to better transport is what is required
Those who suggest otherwise just show their complete lack of understanding of the issue and political economy
But that’s the level trolls are at
So, if I understand you correctly.
I put up a shed on my land at a cost of £1000, I think it will last 10 years.
If I rent it to you for £100pa I will break even
Everything over that £100pa allowing me some return on my investment and that there is some risk to me that you might not pay, it might burn down etc (Ok its only for the sake of the argument ) and any money I might have made say growing cabbages on the site is ‘Economic Rent Extraction’?
No, that is not true
Clearly insuring the property is a cost of naming it available so it is not included in economic rent
And the labour expended on growing cabbages is a labour return
I am not sure what is so hard about that
Is the methodology of SCA clear ? It is not easy to break down the components of any activity to ensure the carbon used is fully accounted for.
I have been studying the methodology for calculating embodied carbon in construction and so far very few people have been able to implement it. HS2 is the classic example of a project that claims it is sustainable but is very far from being justifiable. If the payback period for the embodied carbon used in construction is 200 years then that cannot be considered to be viable.
How does biodiversity loss get accounted for in SCA ?
Do we have a value that can be put on trees or bats or badgers for example ?
I think that’s why XR simplifies the issue to a fundamental one of capitalism not taking these things into account at all. There is a long history of greenwashing in marketing. Selling new things to people is a huge part of the problem we face, the comment about cars above is relevant. We are already being sold the idea of EV’s as the answer to the end of fossil fuels when it clearly is n’t.
If it is not clear then no company can ever estimate its carbon footprint
As a matter of fact they think they can, and that is widely considered to be true
In that case they can also estimate the cost of eliminating it
And no, biodiversity is not in SCA – it does not say it is
Your question makes no sense in that case
If the SCA does n’t measure biodiversity loss it can’t take into account the value of nature in financial terms ?
We need to find a way of valuing the Amazon for example or the loss of habitat as a result of HS2.
If we can’t do that sustainability reports from companies are going to be of very limited value and we wont be able to meaningfully compare what they are doing. This is a huge problem assessing the HS2 project. That’s why XR have targeted what claims to be a sustainable project.
The simple question is can you actually have green capitalism ?
I think E.F Schumacher tried to answer that way back in the 1970s in his book ‘Small is Beautiful’ fairly successfully and his answer was yes, but fundamental change is required in economics such as the way GDP is measured.
When this was first discussed with Prof Aled Jones and Rupert Read (of XR) we agreeed that to even get GHG bases on the balance sheet would be a massive step forward
Do you want to be the enemy of the good for seeking the perfect
And can we have green capitalism? Yes. Read my book The Courageous State to see heat is required and the economics behind it
I will look up your book, and agree something is better than nothing, but it is definitely worth looking at Schumacher again as he tries to address this question holistically and within a framework of economics and wrote this critique of economics 50 years ago from the position of an insider in the fossil fuel industry : summary of the first part of the book below from wikipedia :
‘Part I – summarizes the economic world of the early 1970s from Schumacher’s perspective. In the first chapter, “The Problem of Production”, Schumacher argues that the modern economy is unsustainable. Natural resources (like fossil fuels), are treated as expendable income, when in fact they should be treated as capital, since they are not renewable, and thus subject to eventual depletion. He further argues that nature’s resistance to pollution is limited as well. He concludes that government effort must be concentrated on sustainable development, because relatively minor improvements, for example, technology transfer to Third World countries, will not solve the underlying problem of an unsustainable economy. Schumacher’s philosophy is one of “enoughness”, appreciating both human needs and limitations, and appropriate use of technology. It grew out of his study of village-based economics, which he later termed Buddhist economics, which is the subject of the book’s fourth chapter.’
Kate Raworth’s idea of Donut economics and the 15 minute town is a modern version of this I think.
I read the book when a sixth former and still have it
It was powerful
But, to be candid, it was it great economics in the sense that as you note others have said it better since
Richard Douthwaite did it better not long afterwards
It is inevitable that the capitalist system will be criticized as it I the main driving economic force which is the maximisation of profit. As the long term tendency of profit is to fall, especially as the exploitation of labour has probably reached its limit as you hint, natural resources are the only thing left to overexploit. Until we reach a steady-state economy based on need rather than greed, capitalism will be examined and criticised closely.
“Economic rent is a payment made for use of resource which is not necessary to incentivise its production. That rent has nothing to do with the production process as a result.”
If you were an GCSE economics teacher and a student wrote this, you would have to ask them to leave the class. If there is no return that would incentivise people to use it, why would you use it in a different way? Just let that patio continue as a weed bed. If you could put a flat on that patio and rent it out, then you have an economic rent. So your definition is precisely wrong.
Thank heavens you don’t teach economics in that case
You can’t tell the difference between the economic rent and the return to labour from building a flat on that patio
Now that is why you would be sent out of class
Try learning some economics before making a fool of yourself next time
An excellent exposition of your SCA proposals – and I very much hope people will take heed.
However, poorer people will not be able to afford the higher prices for fuel and other goods implicit in your proposals. Unless, that is, they are accompanied by rationing – same-for-everyone or Tradable-Energy Quotas (TEQs). If not, suffering and ‘yellow vest’-type riots will follow.
But any form of rationing is impossible while the public is largely kept in ignorance. The ‘big lie’ is the implication that minor changes ‘by 2050’ will have an impact on climate trends.
Comparing where we are with history prior to WW2, Chamberlain’s ‘Peace for our time’ Munich Agreement did not work. Even his declaration of war on Germany was insufficient.
When Churchill came to power in May 1940, he abandoned all attempts at minor political manoeuvring by announcing A COALITION GOVERNMENT.
In his first speech to the Commons, he announced, ‘I HAVE NOTHING TO OFFER but blood, toil, tears and sweat.’
Today, politicians OFFER electric cars and a trivial flying levy. They are ignoring facts.
We westerners, many with large houses (or more than one), race around the globe spewing out greenhouse gases for holidays, entertainment and sport.
The emissions that we have created directly or incidentally are at the root of reports such as this a couple of days ago: “Madagascar famine becomes first in history to be caused solely by climate crisis. More than 1.14 million people are food-insecure as severe droughts push communities to the brink of starvation”.
https://www.independent.co.uk/climate-change/madagascar-famine-climate-crisis-b1888058.html .
Meanwhile, Branson, Musk and Besos are lauded instead of being imprisoned and having their wealth used for reparations. Obviously newspaper and media moguls have talent for accumulating wealth. Present and former government ministers have skills. But it is also clear that, if they are saying what they believe, not one of the most prominent has the scientific understanding of the average student who has earned an A-level in Physics. It is time that they were effectively challenged.
Much of Churchill’s speech could be applied to our current climate and ecological peril:
“We have before us an ordeal of the most grievous kind. … long months of struggle and of suffering. You ask, what is our policy? I can say: It is to wage war with all our might; to wage war against a monstrous tyranny, never surpassed in the dark, lamentable catalogue of human crime. Our aim? It is victory at all costs, victory in spite of all terror, however long and hard the road may be; for without victory, there is no survival.”
Climate change is now creating and accelerating a series of calamities. Avoiding widespread death is now impossible.
Using more of Winston’s words: ‘What is our policy?’
I suggest it should be, as far as possible, that every human has a good chance of adequate food, basic health care and education and a home. ‘Fairness’, and little more.
Leeds Professor Julia Steinberger and colleagues suggest a global scenario for: ‘Providing decent living with minimum energy. Ecological breakdown looms while the basic material needs of billions remain unmet. Yet, despite population growth, global use of energy by 2050 could be reduced to 1960 levels – and still provide decent living globally & universally. This requires advanced technologies & reductions in demand to sufficiency levels.
But ‘SUFFICIENCY’ IS FAR MORE MATERIALLY GENEROUS THAN MANY OPPONENTS OFTEN ASSUME.
The drastic increases in societies’ energy use seen in recent decades have, beyond a certain point, had no benefit for the well-being of their populations.
Far from cultivating well-being, consumption is often driven by factors such as private profit; intensive and locked-in social practices; employment-related stress and poor mental health; conspicuous- or luxury-consumption; or simply over-consumption in numerous forms.’
https://www.sciencedirect.com/science/article/pii/S0959378020307512?via%3Dihub
It is time to recognise that our children’s survival might cost us almost everything.
You are ahead of many Joe
Which means you may well be right
The rent we have been paying when it comes to the environment and living on this beautiful oasis in the universe is TIME.
And it it seems to me that we can no longer afford it, because its definitely becoming more expensive to do nothing. TIME is turning into money.
I wish XR well – I hope to join them one day when I retire as my public sector employer has made it clear that it sees them negatively and I’d lose my job as they are I kid you not seen as ‘extremist’!
But if XR don’t grasp the true nature of carbon costing and stuff like MMT – a true alternative capitalist system – then to me at least they will just be another bunch of useless do-gooders – all heart and no brains. And we’ve enough them already.
I pray to God that they’ve read your post.
Me too….
Pilgrim, I wonder if you’re wanting XR to be something they’re not. They have 3 very simple demands, which are:
1. TELL THE TRUTH.
– Government must tell the truth by declaring a climate and ecological emergency, working with other institutions to communicate the urgency for change.
2. ACT NOW
– Government must act now to halt biodiversity loss and reduce greenhouse gas emissions to net zero by 2025.
3. GO BEYOND POLITICS
– Government must create and be led by the decisions of a Citizens’ Assembly on climate and ecological justice.
Every person in XR subscribes to these aims but (as I’m sure you’re aware), XR is not a hierarchical organisation and, for this reason, groups within the movement might also push for discussion of, or action on an additional issue provided that it doesn’t conflict with these demands. I imagine a greater understanding of MMT and its possibilities might fit in here and I’m sure there are people who are aware of, or would be open to that.
Not sure if that makes us useless do-gooders in your eyes. But it did occur to me that as not everything we do is out-on-the-street action, you might find a back-room role for yourself that might open the way to introducing MMT, but without incurring the wrath of your employer.
Jan
It’s when I read stuff like ‘Go beyond politics’ that I just want to give up.
Aaahhhh bless……..poor darlings – so every one hates politics eh? We’ve got to keep nasty old politics out have we? Yeah right.
If XR do not get a grip of the more heterodox side of economics and politics, it will find that it will (1) just run out of ideas about how to finance changes that will save the planet (money is the mechanics of this you know, its the fuel for change) and (2) end up using unorthodox thinking to get us out of this mess which will mean that they just play into the hands of the people who are causing the lack of progress in the first place.
Politics – good politics – is the art of compromise – not about winning outright – the Reaganite/Thatcherite business mode where you have to destroy opposition for ‘market share’. That’s not politics. And lying is lying – that’s not politics either. So why label it as such? Instead of wanting to get rid of politics per se, why not CHANGE it. A world without politics? I cannot see it. A world with better politics? I can see that.
In the Green debate, Richard and others has shown time and time again that there is money, good business and profit to be had from going Green. So there’s your compromise right there. What holds progress back in my view is investors who are adverse to spending money in order to put returns first.
It’s simple to me – courageous Government and politicians just need to either change the rules for investment to favour the planet and other stake holders rather than ‘investor first’. Or, courageous Governments need to print the money to help the carbon lovers to change – rotate into the Green sector not through tax bollocks but through investment – pure money creation that takes the risk of change away in some way. And yes, you can tax that change too in order to control inflation.
I refuse to accept that this cannot be done. Think about how we always find the money for war for example or something else that the politicians actually agree on for once.
XR are activists and I deeply respect that. But XR also have to be intellectuals too – they need to think before they think. Every movement for change is political whether it accepts or not. Any viable group seeking change has to work on a number of fronts and the political one cannot be ignored. I happen to think that much of what is discussed here fits the bill for XRs discussions.
Jan – nothing is ‘beyond politics’. If this is how XR actually are, XR need to grasp that – fast.
We call people in politics ‘politicians’. But if a politician lies – that’s not politics – its lying, just like if a doctor, policeman and a mechanic lies. It’s human behaviour – not politics. The point I’m labouring is that we have to give better politics a chance. It’s about talking, working things through and ultimately agreement – a win/win.
This aversion to politics will just close down deeper exploration of how we can change and what is the alternative. If you want to change, then what are are XR proposing? And is it possible?
Forgot to press submit – poor old brain! If it’s not too late, Pilgrim, I just wanted to ask why you think these things aren’t already being done within the wider XR movement?
As always, much to agree with in your post, Pilgrim. And I’m sorry to have added to your frustration.
Trying to condense a response to the climate crisis into three very short, easily remembered demands (which, of course, also serve as guidelines for action) could not have been an easy task and clearly for you (and probably for others too) it hasn’t been helpful.
I can’t really speak for people deeply involved in ensuring that things continue to happen under the XR banner – among other things facilitating communication between the many diparate groups that comprise XR, but I’d be astonished if they, like very many other members, weren’t aware of the extent to which politics permeates every aspect of our lives. For myself, I had read that as a demand to go beyond “politics as usual” and part of their commitment to the establishment of Citizens’ Assemblies. You’ve read it differently and it’s angered you and that’s a shame because nobody would want to alienate a well-informed, passionate and articulate potential ally.
But I do still think you’re wanting them (us) to be something we’re not are setting out to be. We are not the ones to say how the demands should be met. There are other organisations, much more tightly structured than XR, who could do that, as well as thoughtful and knowledgeable people who fully understand how money systems work ready to step up (Government, of course, should be amongst these, but fat chance!) This is not to say that members, or groups of members can’t or don’t have their own ideas about this, but it’s not what we organise around and what binds us together. If that’s what you want us to be, we will always disappoint you and make you angry.
And by the way, I’m sure we have our fair share of bleeding heart do-gooders, but I don’t think we’re worse off for that.
Jan
I’m not angry I’m just so despondent at what I see as a lack of ambition.
What is XR then? Just a feel good thing for the weekend? Balm for middle class consciences? Gesture politics? A chance to be naughty? Oh come on Jan!
I don’t understand. XR need to develop a political arm – surely? It’s all very well stopping something, but what do you replace it with? What’s it all for.
Marketing? What are you marketing? Change? Change to what? And how? And where’s the cash coming from?
I tell you there’s more than enough in this blog to help you.
I tell you what – have a meeting (any way you want, unstructured and with as little hierarchy as you want) – decide on who wants to be an activist and wants to do some reading and research. Then send the readers HERE to engage.
I don’t know – hire Professor Murphy as consultant or advisor.
I tell you the answers to the deeper question XRs brave stance pose are all here and if not, the beginnings of it certainly are.
For the record I do speak to some in XR…
I really appreciate the work you’ve done on sustainable cost accounting Richard. Do you think it would help with problems like consumerism though? An example would be something unsustainable like fast fashion – how do you encourage companies to make clothes that last a long time, when this would reduce their long term profits?
How do we correctly value uncompensated labour like care work under capitalist structures? How do we avoid labour exploitation?
Most of your solutions point to a strong state within a mixed economy. I agree with the pragmatism, but that’s not about capitalism either – it’s about offsetting the harms that pure profit seeking produces, and having alternative social structures to control for that damage.
I think your future version of society sounds great, but it is not what many would describe as capitalism.
Why can’t we criticise capitalism? Why is that off limits, and why is everyone so afraid of suggesting there may be alternative economic systems that would work better?
To me it sounds like circular economies are sufficiently different to our current system to not be considered capitalism at all.
Chris
Thanks for the comment.
First, I make no claim that SCA answers all problems. On consumerism, the curse of interest and the relationship with debt, see my book The Courageous State where I dealt with those issues. But different regulation is required to address them.
SCA might increase prices, but the market should still work. My point is, if prices do rise that’s not the fault of SCA. It is instead that we are currently abusing resources to subsidise society, whilst the richest get richer. The answer is instead to reallocate resources to those who need them. That’s not because SCA is wrong, it’s because society has income distribution wrong now.
In other words we need a strong state within the knowledge of what it has to do. But let’s be clear, that’s what fair markets always require if they are to not be abused. But remember, abuse is not capitalism, it undermines it. So I am actually promoting capitalism when right now that’s far from what we have actually got.
I am not pretending this is easy: SCA is probably the easiest bit. But no one said saving the planet was going to be easy.
Richard
Thanks Richard,
With a profit motive currently being the main driver of our economy, it seems that the corrupt often attempt to use accumulation of capital to gain excess power.
Supposing you made social welfare or other criteria the main measurement and purpose for the economy, and disrupted the ability of the powerful to acquire more and more resources, (i.e you actually succeeded), then would you actually have “capitalism” anymore?
Being as we’d not be obsessed by GDP growth or increasing profit (or the pretence of profit through fraudulent means as you sometimes mention) where would be the drive to accumulate capital at all? Without that accumulation, what would actually make it capitalism, and not some alternative market economy?
That was really what I was getting at with my original question, even if it seems semantic perhaps.
All noted
If we have a society where people can work for profit (and the self employed often do) isn’t it capitalist?
I think it is
Capitalism can morph
I suppose technically, but surely it’s return on capital that really makes this a capitalist society, not return on labour.
If everyone was employed by the state as self employed contractors, they might be making profit, but it wouldn’t be considered capitalism.
But I don’t want to split hairs. If we can wrap up basically socialist ideas in a bit of PR and call them “all new and improved capitalism” then that’s fine by me too. I’m a pragmatist.
[…] Cross-posted from Tax Research UK […]
This is a great thread and I am late.
Not convinced that XR need to know MMT. Coming back to Joe B excellent comment on leadership we could remember that not knowing MMT did not stop Churchill. A better catch phrase for XR is a variation on the Ann Pettifor quote, we can afford what we can do.
Keeping within the 1.5 degree bound is completely feasible but to make it happen will require strong leadership and currently we are not seeing much of that.
Ann was quoting Keynes, directly
Thanks. You are right.
Anything We Can Actually Do We Can Afford. Keynes: 1942
See this link for a bit more of the speech.
http://jwmason.org/slackwire/keynes-quote-of-day-2/
Obviously Keynes was not addressing the climate emergency but he does mention
“urgent and necessary outgoings on […] replanning the environment of our daily life”
He got it right
‘Not convinced that XR need to know MMT.’
Jesus wept.
XR are are in the public sphere, their important message already being undermined by the ‘anti-terrorist’ agenda (convenient conflation of XR with other issues, just like the agnotology play books say opponents should) or petrol heads who see motoring as a human right.
Like anyone who is trying to tell people that we are on the wrong track, there will come the question ‘How are you going to pay for it?’
There has to be answer ready for that, that XR believe in and get behind. There is a tremendous opportunity here to tie activism and heterodox economics etc., together. And it will make them more credible and heterodoxy too – a force with depth, because the forces we are up against have incredible depth and reach at the moment.
Other than that, I’m not trying to convince anyone. Just think about it that’s all. Or not , as you wish.
But it still has to be said whether you buy it or not.
The big risk is that XR just emerges as a group of individuals who all agree that there is a problem, but do not agree about how to deal with it. Think about how and why the Occupy Movement just seemed to fade away. It wasn’t just because there was no political take up in establishment politics – it was that there seemed to be no sense of where it was going wasn’t it?
So really is XR just a ‘loose association’ of sorts easily seen as a bit eccentric and nothing else, but hey it makes those individuals involved feel good about themselves – ‘themselves’ being the biggest malady in society at the moment? XR actions bother ordinary people mostly from what I can see – not politicians or the rich that much.
Climbing on tube trains and interrupting roads? Really? Hmmm. OK. Well, good luck with that. Maybe XR will have to explain further just to get around the resentment that might build up in the general public?
Richard – I hope that XR opt to spend more time in your company and note your successful influencing record. I really do. Sincerely.
The ultimate question is always ‘how will you pay for it?’
XR will need to address it
“How are you going to pay for it?”
My answer is much simply.
Just like we paid for Roosevelt’s New Deal!
Tried and worked!
Professor Murphy, thank you for the work you do.
Reading your posts, this one being a prime example, really makes me evaluate the way I think about the issues of today (and tomorrow) and also educates me extensively.
I can’t add anything to this thread, specifically, except to say that your approach to problems of proposing solutions rather than just protesting is excellent. The solutions you propose also make great sense and on the whole I think I have a grasp of most of what you talk about.
Long may you continue and I hope your influence reaches those who really should be on top of all this.
Richard, Thank you.
“XR opposed to a form of capitalism that is built on the basis of the exploitation of natural resources for the benefit of a few at cost to the many in society who are at risk as a consequence. And what it wants is that this exploitation be brought to account.”
Yes, but it needs to be in three words please (e.g. get brexit done) or it won’t work. It is 2021 you know.
Let us live
‘Think Globally Act Locally’ is pretty good in 4 words or ‘Make Polluters Pay’, 2 old ones.
An excellent post Richard, and one I will be sharing. Thanks
I’m very pleased that you have increased your focus on the capture of economic rents that is the defining feature of this ugly variant of capitalism that is misnamed as neoliberalism. But, as I’m sure you’re aware, it’s very difficult to secure public interest. I’ve been banging the drum in Ireland on this for the best of 20 years to no avail.
Those who benefit from the sustained capture of economic rents – and who often expend resources to maintain their capture up to the value of the rents themselves – will simply deny they exist. Those who fund these economic rents often have a good idea they’re being ripped off, but can’t identify precisely how it is happening (and are often conned by the rent capturers who claim they know how the system works and no economic rents are being captured – because if they existed they’d be competed or taxed away). And the final consumers and service-users who fund these economic rents often swallow this self-serving nonsense.
But I wish you well in your efforts. It’s probably one of these areas where one has to keep chipping away and eventually soemthing will give.
As for XR, they give off a stench of anti-capitalism that tends to repel most voters.
I am discussing this as an academic paper now…..
That’s good to hear. But it is an enormous topic. There seems to be little understanding of the extent to which rent capture is pervasive and endemic and to which the entire legal, policy and administrative structure has been distorted to facilitate and protect the sustained capture of economic rents by those who exercise economic and organisational power – and, via this power, political power.
For example, in Ireland, the Leprechaun Economy enclave generates huge economic benefits for the economy, but it also hugely distorts the Irish economy. Although genuinely productive economic activities are being performed by the mainly US MNEs in the enclave, the driving force of the enclave is the capture of enormous economic rents. The Irish state captures a share of these economic rents in the form of corporation tax receipts, but, while prior to the GFC it allocated a portion of these receipts to a Pension Reserve Fund, that fund was pillaged after the triple bust in 2008. Rather than building up and maintaining a sovereign wealth fund, as Norway has from the economic rents generated from the exploitation of its oil and gas reserves, Ireland has nothing to show for decades of rent capture. And now the OECD BEPS process and changes in the US tax regime will severely curtail the rent capture by the US MNEs.
And to make matters worse, the generous rates of pay in the enclave and the economic rents it allows Irish professional (and other) service providers to capture set the markers for pay and costs in the indigenous economy. The result is that the Irish cost of living is 30% above the Euro Area average. Unfortunately, while the median equivalised wage is also above the Euro Area average, it is not 30% above it and many households, fully engaged in the formal economy, are really struggling.
Ireland also has health and housing crises and an inadequate provision of public services that have been provided on a universal basis for decades in the other advanced economies. The root cause of these crises is the official facilitation of the sustained capture of economic rents.
All of the other advanced economies are plagued by the sustained capture of economic rents, but Ireland has the problem in spades.
Thanks
And I agree re Ireland – and that for it that has always been the case. Property rather than enterprise was always its answer
Since revolution is not on the menu, the challenge, to paraphrase Marx, is not just to analyse it, but to change it.
Our biggest deficiency is that there is no tradition or practice of the statutory representation of the collective interests of final consumers or service-users either here or throughout Europe as there is in the US. Whereas the US has long had mainly private sector provision of utility and essential services subject to quasi-judicial regulation with the statutory representation of the collective interests of service-users, here and in Europe it tended to be nationalised public provision of these service. However, since these services have been largely privatised, final consumers have been atomised, individualised, disenfranchised, disempowered and their biases and behavioural traits exploited to extract additional revenues for the service providers. These companies devote considerable resources to bamboozle consumers so as to extract additional revenue from them. Regulators claim to be protecting the public interest but most either been captured by those they’re supposed to regulate or are swamped by the inevitable asymmetry of information.
We have to start with the statutory representation of the collective interests of final consumers and service-users.
Well said Richard. You ARE making an impact where it matters; public protest is our major weapon at the moment. How can people with similar convictions to you also be heard:
-Form a campaign group combining MMT, Fair Tax and SCA?
– Join an existing campaign group?
– something different (peaceful/lawful) that would make an impact?
Writing to my local MP Peter Bone on a number of issues over the years has proved futile. Whilst shielding, I prefer not to join public demos but a lot can be achieved online with a credible message
Don’t give up!
I’m not giving up
I do think we need a new economic justice organisation – it is something I am discussing but I am definitely not the person to run it
‘Extinction Rebellion’ heads this post because XR activists have put climate change firmly into the conversation.
30 years of scientific reports and good suggestions like ‘Green New Deal’ and SCA did not do so.
Paul disapproves of ‘anti-capitalism’, but his comments on the way capitalism is failing poorer people in Ireland is just one indication of the system’s failings.
Here is another: ‘A UK oil company is currently suing the Italian government for the loss of its “future anticipated profits” after Italy banned new oil drilling in coastal waters. “Investor-state dispute settlement” makes effective action against climate breakdown almost impossible. It represents an outrageous curtailment of political choice, with which governments like ours are entirely comfortable.’
https://www.theguardian.com/commentisfree/2021/aug/19/life-earth-second-place-fossil-fuel-climate-breakdown 19 Aug 2021
The Murdoch-Barclay-Rothermere-Lebedev press owners discourage effective action. https://www.opendemocracy.net/en/opendemocracyuk/five-reasons-why-we-don-t-have-free-and-independent-press-in-uk-and-what-we-can-do-about/
Pilgrim wrote “I wish XR well – I hope to join them one day …”. I was encouraged by that but then “just another bunch of useless do-gooders – all heart and no brains.”
Thanks Pilgrim!
In Somerset, a bunch of us organised public meetings for 3 MPs and 2 MEPs. We showed Al Gore’s film, ‘An Inconvenient Truth’ twice … and that’s not one tenth of it.
2 years ago Dorset Council declared a Climate and Ecological Emergency. When the Council published a strategy for consultation, XR created series of Zooms. Councillors asked us to put on more for their areas – and we did.
In my experience XR organisers are politically savvy, well informed, diligent and determined that everyone should be heard.
If you don’t want to join XR (yet) fine, but surely it is in the interests of children you care about to support us.
In the recent Climate Crisis Advisory Group http://www.ccag.earth report Sir David King asserts “The current shift in global emissions is not sufficient to avoid global disaster; there is no ‘remaining Carbon Budget.’”
We need to STOP ALL USE OF FOSSIL FUELS for pleasure or entertainment NOW.
Is it anti-capitalist to point out that the space antics of Bezos, Branson and Musk convey exactly the wrong message?
3 days ago I suggested an aim for governments: As far as possible, that every human has a good chance of adequate food, basic health care and education and a home. ‘Fairness’ and little more.”
That policy will require unilateral action from coalition government. Party political rivalry will not do it.
I’d like to highlight an entrenched economic measure that some have said is not fit for purpose now, if it ever was, namely Gross Domestic Product (GDP).
For the past eight years, an alternative world-wide measure has been published annually and it is called the Social Progress Index under the Social Progress Initiative (SPI) organisation https://www.socialprogress.org.
It is an annual country-by-country analysis of progress on a myriad of metrics and takes some wading through but is a much better basis for measuring progress towards defined goals of a population’s wellbeing. A number of governments have adopted it an an alternative to, or alongside, GDP measures.
In reply to Sam’s comment, at the very beginning of the thread: Another reason why Dr Bradbrook’s use of a diesel-fuelled vehicle isn’t hypocritical is that XR does not campaign for individual people to change their lifestyles and personal habits. XR’s three demands are aimed squarely at those who hold the power of governance and policy influence. All of us are caught up in the same economic model, in a social and economic infrastructure fuelled by the burning of fossil fuels and a culture driven by consumerism. It’s the comprehensive transformation of that system that XR is focused on, alongside and in collaboration with other movements with the same aim. We don’t, as a movement, advocate specific solutions (ditching diesel vehicles or anything else!). We recognise that there are thousands of experts in all of the relevant fields of research and development working on solutions to the crisis and that, if XR’s third demand is met, those experts will be brought to bear on working out what we as nations do, on a national and international level, to address this colossal emergency. We’re using non-violent disruptive tactics because none of the other measures available to us as citizens of a democratic country have worked (30 years of IPCC assessments, international climate conferences, national plans, actions and campaigns by NGOs and, of course, all manner of ordinary people making all manner of personal lifestyle choices, and the crisis, on all its complex, inter-connected levels, continues to accelerate). We don’t ask ordinary people, any people, to change their individual lifestyle choices. We ask one thing of them, and that is to join us. Once you understand what XR is about you see that the ‘hypocrites’ tag is misplaced.
Thank you