Labour Luddites and a Prime Minister as a Poodle

Jeremy Corbyn has gained a new measure of popularity in recent months, largely because he has become popular. He has changed from being a crabby, obsessed 'leftie' to being an almost-charismatic emblem of popular disgust with boring, respectable politicians. In his speech yesterday his main task was to transmit some of the enthusiasm that was being shown - to excess - in the hall at the Labour Party Conference to the wider population; while combining it with a measure of responsible policy that can be presented to the electorate. Much of what he has recently advocated has my strong endorsement , based on half a century of intensive study of the history and effectiveness [or, as usual, ineffectiveness] of economic policy: especially when derived from economic theory. A modern country needs a mixed economy, with a large amount of state investment and public ownership of natural monopolies [which must, of course, be at least as well managed by the public sector as the private sector: which would be hard to achieve, but is doable].

One aspect of his speech, however, verged on the cretinous. That was his apparent Luddism in suggesting that action should be taken - including punitive taxation - to prevent human beings' jobs being taken over by robots; presumably at the behest of wicked capitalists. Virtually every forecast for the medium term future of the economy envisage huge benefits [not least, massive gains in productivity and in the range of products and experiences that will be available] due to innovations where human ideas are made into products and experiences to be enjoyed by everyone by the combined action of people and machines drawing on intensified robotics and enhanced artificial intelligence [AI].

The origin of the term Luddism comes from the mythical character Ned Ludd, the supposed organiser of the gangs of handicraft workers who broke into premises and smashed machines that were capable of replacing old-established crafts [because they greatly enhanced productivity] in the new factories, particularly in textile manufacture in the period 1790-1820. Individual employers were ruined by the Luddites, and a few workmen were penalised when they were caught in the act [or betrayed by colleagues]; but over a couple of decades the machines prevailed, and employment increased [though this often included child exploitation, until that was banned by laws that were enforced by inspectors who actually entered the employers' premises]. The ban on child labour, the ban on womens' night work, bans on the use of dangerous chemicals and processes need to be enforced in a civilised society: the state must be active in the economy to promote and preserve human rights and humans' health. One result of recent laissez-faire attitudes in society at the start of this millennium is the rise of 'modern slavery' [though I cannot detect anything notably modern about it]. The government's obsessive austerity has reduced the numbers of police officers, while terrorist threats have reoriented the work of many officers: with the result that offences like internationally-traded forced prostitution and domestic service have grown almost uninterrupted.

This is the background against which - so it is promised - Mrs May is to utter a peon of praise to the 'free market' as the central point of her speech to the Conservative Conference which opens today. This will be contrasted by the press [which is predominantly pro-Conservative] with the backward-looking old socialism and Luddism of the Corbyn effort yesterday. Mrs May will utter this claptrap in between calls to the US president asking for his intervention in a trade war with the US over the fate of the Bombardier aircraft factory in Belfast [and three other plant in Northern Ireland, as described yesterday in this blog]: a prime example of point protectionism which makes nonsense of the hard Brexiteers' vision of the future. Mrs May has to press this case, in defence of free trade ideology, despite the fact that her parliamentary majority depends upon taking a chauvinistic stance on the Bombardier issue. She lost the recent general election, and clings on to power with the votes of the Democratic Unionists. All the Bombardier plants are in constituencies held by the DUP: and the Bombardier jobs are of such importance to Catholic as well as Protestant workers that Sinn Fein's leader has signed a joint letter with the DUP leader to send to the US Vice-President. Hostilities at Stormont have been transcended by this issue; and Mrs May is compelled to make a nonsense of her free market rhetoric even as she utters it. Nevertheless, as a poodle of the Northern Ireland politicians she has no option but to demonstrate in the clearest way that her rhetoric is claptrap. Thus the Tories will be diminished by the inconsistency and infighting that will be in full view in the coming days: yet they all know they must hang on to office, or Corbyn will have the chance of his lifetime.

Managing the Labour Party

Jeremy Corbyn may be the starry-eyed idealist that he often presents himself to be: in which case he is too good for practical politics, and certainly the last person to control nuclear weapons. Yet there is a good chance that the incompetence of the Tories, and the egomaniacal economic illiteracy of Boris Johnson in particular, could hand him the control of Downing Street.

It is therefore particularly important to note that he - or his manipulators - has prevented the Labour Party Conference from expressing a view [let alone, declaring a policy] on the dominant issue of the day: what does Brexit mean?

On one aspect of the matter his view is entirely sensible: this country needs a fundamental economic restructuring, with a significant implementation of mixed economy policies. This could well include the resumption of state ownership of natural monopolies - the railways, electricity, gas and water supply. It is also fundamental that a country with advanced manufacturing industries, which need to be fostered and developed into a new era of high productivity, retains the fundamental capability to produce steel. Corbyn has rightly said that the EU rules on 'state aid' to business would make it virtually impossible to take the necessary measures; but he has conceded that it is plausible to envisage a model in which the UK can be free to make industrial policy and still have a close customs agreement with the EU.

Given Corbyn's popularity with the new party faithful, and the anxiety of older loyalists to remain in favour, it is likely that he could win a vote on Brexit in the conference, and vindicate his stance: but he had declined to do that. This is pure Stalinist politics; the avoidance of any risk that he-who-must-be-obeyed is to experience challenge.

Also in the conference, John McDonnell is to make a major issue of the mass indebtedness that has beset the United Kingdom since the 2007 credit crisis compounded the economic disablement that Thatcherism brought upon the population of the ex-mining and formerly-industrial regions. His 'solution', to make it impossible for lenders to charge more than twice the amount borrowed, in fees and interest during the length of a loan, looks wonderful: but is utterly impractical. While it could apply to specific hire-purchase type agreements of individual items, most debt is not susceptible to a cap of that kind. Car loans are usually cut short when the car is changed: the debt outstanding on the loan is settled usually by manipulation of the used-car's and the new car's 'prices': it would be impossible to compute what would be twice the amount of the loan, in any simple terms. Even more complex is the question of credit cards, which are by definition a flexible rolling loan covering a complex of debts that are entered into and resolved in myriad individual agreements. It would be impossible to compute how much interest and service charge was imposed in respect of any item within the card's compass. To set a maximum APR would make the system non-viable for the banks, even though they would be constrained by circumstances to charge the set maximum all the time for everybody: and the system might still be non-viable. If the credit card system collapsed, a lot of people would be disadvantaged. But it is odds-on the McDonnell's proposal will be accepted with rapturous applause. This will demonstrate another Stalinist 'truth', that the practicality of a policy is unimportant: it is the principle and the intention that count in an authoritarian regime.

There is always somebody to blame when a policy fails; and McDonnell has spent the last quarter century blaming the bankers, for the much evil they have done and the many things they could not help. Thus the world rolls on, and the left changes as little as do the Tories. Time for the Liberals to re-invent themselves again?