NEOLIBERAL CAPITALISM IS A DISASTER

Michel Albert published Capitalism against Capitalism in 1993. Its central theme was that humankind then had very different varieties of capitalism from which to choose. Having no challengers then, capitalism had no mirror in which to examine itself, no alter ego against which to measure its performance. West Germany then had the highest wages and the shortest working week amongst highly industrialised nations, and had built up a huge trade surplus with the rest of the world at the same time. But since about 1980, Reagan’s neoliberal version of capitalism and West Germany’s capitalism had proceeded in very different directions.

Michel Albert suggested in his book that during the 1970s America seemed to be in retreat in every continent,powerless to stop Soviet expansionism But in the presidential election of November 1980, the far right Republican candidate Ronald Reagan triumphed over the Democratic President Jimmy Carter with a majority of 9 million votes,winning 45 States against Carter’s 5. In the next presidential election in 1984, President Reagan won again, this time winning 49 states.

President Reagan ‘possessed an intuitive genius for capturing and shaping the economic trends of the 1980s’. European social democracy was evaporating. Adam Smith’s capitalism was ready to return, and President Reagan’s awareness of these trends and how to take advantage of them achieved great influence worldwide. Europe was his first major success, followed soon afterwards by developing countries in which a dramatic shift toward market forces, open competition and private enterprise was secured by the combined efforts of the World Bank and the International Monetary Fund(IMF). Europe and the South were soon privatising extensively. Monetary policy was adopted generally in attempts to control inflation that was depressing property values and earnings and worsening inequality. Margaret Thatcher, who became the Prime Minister of the UK in 1979, held views similar to those of Ronald Reagan She envisaged a Europe of thrusting business and beefed up trade at the expense of Jacques Delors’ vision, shared by the European Parliament, of a political and social community. But ‘the Reaganite boom so admired by the world’s movers and shakers bore little resemblance to the genuine economic miracles of which West Germany, Japan or South Korea could boast’.

David Harvey (2005, p89) considered West German and Asian ‘regimes of accumulation’, as similar and also that ‘In Asia. the Japanese model was broadly emulated first by ‘the Gang of Four (South Korea Taiwan, Hong Kong and Singapore, and then by Thailand, Malaysia, Indonesia and the Philippines’ .

After the fall of the Berlin Wall in 1989, reunification was facilitated by German confidence – both in the former Western Federal Republic and in the East of Germany – that acute short-term problems- huge financial deficits, higher taxes and substantial social problems-would be amply compensated by long term benefits. This long-term vision was founded on the West German priority for the common good over individual interests.

Unfortunately, however, Germany’s progress after reunification was not reflected in similar progress in Poland Hungary and Czechoslovakia (later split into the Czech and Slovak Republics). The European Union (EU) to which these countries belong is only a free trade zone and by no means a political federation. Unlike East Germany these countries were unable to benefit from the generous financial assistance which was granted by West to East Germany. And both the UK and the EU may have been weakened by the subsequent UK departure from the EU.

But the last thirty years’ experience have made it clear that neoliberal capitalism has no viable solutions to offer to confront the enormous threats to life on our small planet posed by global warming and biodiversity loss.

More than a quarter of a century after Albert had published his book, Carolyn Steel published Sitopia: How Food Can Save the World, in which she suggested that food shapes our lives. Many of our greatest challenges – such as climate change, mass extinction, deforestation ,soil erosion, water depletion, declining fish stocks, pollution, antibiotic resistance and diet-related disease – stem from our failure to value food. She suggested that by valuing food we can use it to build fairer, more resilient societies and lead happier lives.

By 2020 when Carolyn Steel had written her book, she had concluded that food shapes virtually every aspect of our existence. So she decided to call her book Sitopia: How Food Can Save the World. Sitopia was a word that she coined by combining the Greek words sitos meaning food, and topos meaning place. Her book’s value derives to a considerable extent from its treatment of relationships between people and nature and within nature itself as being even more significant than just relationships between human beings. While human beings have not always had as harmonious relationships with nature as she considers that we should have had, she suggests that a brighter future would await us if we could devise means of making our relationships with nature more harmonious.

But substantial human assaults on nature may have started as long as 70,000 years ago, and they have continued ever since. Many such assaults have been on the diversity of nature which sustains human lives in many respects – particularly in relation to the provision of food. And the author writes: ‘Biodiversity loss doesn’t scare us as much as it should…’the loss of species represents a threat to us potentially far greater than climate change’.

Between about 70,000 and 14,000 years ago – before farming started. Human hunters may have played an important role in the extinction of a substantial proportion of the large mammals that had existed previously. But it is far more significant that when farming got going, in the course of domesticating only a small variety of plants and animals we humans have certainly been responsible for drastic reductions in the huge diversity of wild species living on planet earth, and for destroying habitats in which they had survived.

Since the beginning of the twentieth century, there have been very considerable population declines and habitat losses as a consequence largely of farming. Habitat loss, pesticide use and climate change have led to the deaths of huge numbers and great varieties of insects and birds as well as of animals and of plants, and of the fishes and numerous other creatures which live in oceans and rivers. These represent massive anthropogenic erosion of biodiversity and the ecosystem.

Caroline Steel refers to her perspective as ‘Sitopian economics’. This involves the realisation that when food produced by industrialised methods is sold at low prices to its consumers, those low prices conceal many very high costs which are often not met by the consumers. Industrialised food production is food produced by methods including excessive use of fertilisers and pesticides. The costs which cheap food incurs which its consumers do not pay for include costs of deforestation, soil erosion, water depletion, exhausted fish stocks, water, air and land depopulation , unemployment climate change and mass extinction.

Sitopian economics also incorporates understanding that some parts of those excessive costs of low-priced foods may indeed be paid by the consumers of cheap industrialised foods themselves in terms of obesity and chronic disease which may be caused by factors such as food additives used in production of food to by eaten by people, or antibiotics fed to cattle killed to produce meat. It also includes the belief that everyone should be happy about paying higher prices for much higher quality food produced in relatively small farms. Many people thinking about this initially may well think that this would involve going back to the past and, accordingly, that it would be crazy. But this is not necessarily so.

Many small farmers, including those living and working in poor countries are already using new technology, and will continue to do so increasingly. For example, computerised agriculture can use robots to help farmers to farm more naturally. Computerised sensors combined with precision drone mapping can help monitor soil moisture and mineral content, guiding farmers on how to use their fields and plants better. And many positive developments which enable farmers to produce better food by using more advanced methods can be initiated by farmers themselves or by local organizations of which they are members, and do not necessarily depend on government directives

Sitopian economics also includes consideration of issues related to the fact that the ownership of land in the world is very unequal. For example in Britain one third of all the land is owned by a tiny number of aristocrats, and this forms an important part of the gross inequality of wealth in British society. Consideration of how land –based wealth taxation systems might well play roles both in making for fairer distribution of wealth, and in improving the distribution of land between different uses, could be very valuable in this context.

The dominant mode of capitalism in the world is now the liberal unregulated model associated with the philosophies of Margaret Thatcher, Ronald Reagan and their disciples. Michel Albert perceived this mode of capitalism as little more than a jungle, simply a market, with no underlying social cohesion. His prime purpose was to warn of the dangers presented by the growing ascendancy of this aggressive brilliantly promoted, but least efficient and least responsible form of capitalism.

Unfortunately, thirty years after his book was published, Michel Albert’s worst fears have been realised fully. Neoliberal capitalism has continued – and perhaps worsened in Europe especially in the UK now separated from the European Single Market. Carolyn Steel suggested that the election of Donald Trump in the USA and the British referendum decision to leave the EU – both in 2016 – indicated that majorities of voters in both countries believed that neoliberalist capitalism had run its course. For example, in the UK there is deep anger amongst workers whose wages barely cover their living costs. They blame their woes on immigration and above all on a corrupt political class. The tragedy of Brexit is that many of those who voted for it- people living in deprived previously industrial regions – are those whose livelihoods had been destroyed by policies of applying free-market ideology. The reason why Donald Trump’s protectionist policies could never ‘Make America Great Again’ is that far too much wealth now stays where it is generated – in the financial system.

The USA and Europe are now confronted by Russia and China – both of which have developed into authoritarian states even less democratic than the neoliberal capitalist states of the USA and Western Europe. So Carolyn Steel’s recent suggestions for reform could be particularly welcome. She remarked in her book that the Wall Street crash of 1929 in the USA had led to the New Deal there Andin the UK the Second World War had led in the UK to the creation of the welfare state.. She suggests that those were the most visionary social programmes in those countries during the twentieth century. She drew lessons from these examples that when people experience hardship, this stimulates more empathetic, altruistic and visionary attitudes. We now need a new economy geared towards helping us to flourish within our ecological means. The present global warming crisis could possible lead us towards valuing food much more, as suggested by her book. This could possibly help towards people living happier, healthier lives by guiding us towards the creation of fairer, more resilient societies.

The very broad perspective adopted in Steel’s book with its emphasis on working with nature rather than fighting against it creates the possibility of more relevant analyses and better policies than do the narrower political economy perspectives adopted still by both neoclassical and Marxist political scientists and economists. Nevertheless, their often inappropriate advice continues to dominate the thinking of most people with great political power practically throughout the world.

References
Michel Albert,1993, Capitalism against Capitalism,Wurr Publishers, London,
David Harvey,2005, A Brief History of Neoliberalism, Oxford University Press, Oxford
Carolyn Steel, 2021,Sitopia,How Food Can Save the World, Vintage, London