Latest post on Left Futures

The Free Market, the Monopolistic Market, and the Inclusive Market

The Liberals wanted to form a coalition government. Remember that. I’m talking of course about the Liberals in the 1981 SDP-Liberal Alliance under the leadership of David Steel. It was that year he told delegates “go back to your constituencies and prepare for government.” Then the Falklands war happened, and the rest is history.

During Steel’s tenure, he was criticised by social democrats for legitimising Thatcher’s economic policies – ambiguous, as it was, whether he put too much emphasis on the market, and not enough on the social, in his “social market” policies.

As far as Steel was concerned, he was just being liberal. The Conservatives and Labour were the non-progressive forces leeching off vested interests, whether that was monopolistic big business, or militant trade unionism.

His version of social market economics posited that more people, families and communities should be the beneficiaries of a thriving market, as opposed to a select few up the top, and that surplus should be better distributed as part of an adherence to the basic precepts of welfare.

Today, all parties think like this. In fact, some go further still. When Mandelson told us he was comfortable with the super-rich, he was basically telling us that surpluses should stay locked in at the top, and that monopoly capital did not affect the chances of the rest of us.

In a sense, Steel dreamed up an economic policy which imagined free markets, when better regulated by the state to be less monopolistic, would benefit everybody. But this is not a free market. When free markets work properly, monopolies are a reality – there is no getting away from this. Just ask any supporter whether Microsoft contradicts capitalism.

I’m sure Steel had good intentions, but the type of good capitalism he wanted – which is accepted today across the mainstream political spectrum – cannot have it both ways. Either the market is allowed to control itself, in which case capital will be concentrated, or you try and control it in the pursuit of some kind of dream-world stakeholder society.

Save for the Randians (for whom the moral pursuit is self-interest), if your politics are based upon an ethics of the good society, then the prospect of the free market working as freely as possible will not appeal. It is for this reason that Steel and his modern day adherents are deluded and wrong – the market that is most free is not the one that creates the highest amount of inclusion in it.

Comments are closed.

© 2021 Left Futures | Powered by WordPress | theme originated from PrimePress by Ravi Varma