Simon Duffy

Thoughts, Bemusements & Arguments

Tag: conservatism

Ideal Markets or Real Markets

In public policy we use the word ‘market’ in radically different ways and in fundamentally inconsistent ways.

For the liberal (or if you prefer, neoliberal) the word ‘market’ is used to describe a special kind of human interaction – the ‘free exchange of goods or services at an agreed price’. The beauty of this liberal vision lies in the market’s seemingly magical ability to achieve three wonderful things at the same time:

  • It is a place of freedom – free individuals come together to bargain and exchange
  • It is a place of community – people make promises to each other and bind each other by contracts
  • It is a place of productivity – time, energy and money flow into the places which have the most value.

Of course, this vision of the market is just a beautiful ideal. In the real world:
The starting point is not fair, and advantages accrue to those already advantaged, and so freedom turns into exploitation.

When relationships of power are radically unequal then the community we create is atomised and elitist.
The most productive is not always the best; commerce can destroy nature, community, industry and even politics itself (as we are finding out to our cost in the UK).

And most liberals do know this. The market is their ideal, but they accept that in many areas there will be what they call ‘market failure’ and – for various reasons – it is recognised that the ideal market cannot really exist. So they will – to varying degrees – accept that markets must be controlled or an alternative system offered in their place. The market is for the liberal a ‘Platonic ideal’ – it may not be fully realisable – but we should strive towards it and use it evaluate the real.

Thus economics becomes the measure of man, not man the measure of economics.

Of course there are those who do not worship the market. These anti-liberals include socialists and conservatives. This may seem a surprising alliance and we often forget that there used to be a very different kind of conservative (small c) philosophy – one that valued King, country, religion, the local and the small. But this kind of conservatism now has nothing to do with the UK’s Conservative party. The Conservative party is now the leading ‘liberal’ party and it is no longer in the business of ‘conserving’ anything at all – except perhaps the interests of the rich and the powerful.

The anti-liberal thinks of the market not as a space but as a force:

  • The financial market is a malevolent force selling fraudulent products or gambling with our savings.
  • The housing market is crazy bubble where our own greed drives up prices to the benefit only of those who can escape it at the right point.
  • Markets drive the growth of monopolies, big business and the industrialisation of almost everything – markets even seem to kill the possibility of markets.

Of course socialists and conservatives also will accept the need for markets. Only the most zealous want to control food production, everyday shopping or enterprise. But the market is, for them, not an ideal space, but a demon, to be controlled and harnessed. At best its energy provides other resources and so it can be taxed to support the things the anti-liberal really values.

Until the 1990s the battle between the liberal and the anti-liberal was largely fought on the margin of the sphere of public services. Markets were for private goods and services; when it came to public services it was the state that was in control. There was a disagreement about what should be nationalised and what should be left free – but no disagreement that nationalisation meant – ‘outside the market’.

But this has now changed radically. Today it is quite common to hear people talk about markets for public services: the social care market, the healthcare market, the market for social housing. However these markets rarely have any of the qualities that the liberal associates with markets. It is not people, making free decisions, who buy these services – it is commissioners or governments. Here the word ‘market’ takes on a third meaning – roughly – ‘the stuff we spend public money on’.

So we are left with three entirely different and contradictory meanings for the term market:

  1. A space within which free, contractual and efficient exchanges can take place – the idealised market
  2. A force which can redistribute, steal or exploit resources and power – the demonised market
  3. An array of objects, services or products, perhaps purchased by the state or its agent – the phoney market

Of course when a word is so used and abused it is easy to lose patience and to simply abandon the whole concept. What is the value of the word ‘market’ when it means three contradictory things?

However I would like to make the case for a fourth use of the term – I would like to make the case for the market as an ‘agora’ – a free, protected and public space where a whole range of human activities can be carried out. The agora is not primarily economic – it is simply the space the community needs to collaborate and to work together. Business can be done there, but it is not defined by business.

I was very struck a few years ago to find, on a visit to Athens, that the ancient agora had been marked off by sacred stones. The purpose of these stones was to protect the agora from the private – from the invasion of the sacred space by people’s desire to extend their houses or gardens. It was sacrilege to privatise the market – the market was public property – divinely blessed.

What is more the agora was not just for shopping. The agora was for every kind of public business. The school master taught his students; philosophers sat on the stoa, a shaded area on the edge of the agora (hence stoics); government officers worked and ran meetings; and temples operated. The agora is messy and human – lots of stuff goes on – out in the public square. The agora even housed the building for weights and measures – the system for checking on cheats – for ‘regulating the market’.

Interestingly the agora excluded the Acropolis (the centre of religious life), the assembly which met on the Pnyx (the centre of political power) and the Areopagus (the centre of justice). Each of these institutions was based on one of the hills looking down over the agora from on high.

Perhaps it is time to leave the idealised, demonised and phoney markets behind us. Perhaps it is time to work out how to protect and cherish real markets – the agora – those essential public arenas in which we do stuff together.

Today these place will not just be physical – they will also be virtual – but they are essential. Without the agora we cannot be fully human.

The Welfare State and Citizenship in Political Theory

We tend to assume that what we call the Left is broadly for the welfare state while what we call the Right is broadly against it. However the reality is more complex, in fact only a few extremist are exactly against the welfare state. Almost everyone is for the welfare state, but what they disagree about is what kind of welfare state is best.

From my perspective the kind of welfare state we want is one that supports robust and active citizenship – for all. I want to live in a society that welcomes all it’s different members into a real and vibrant community – not as cogs or components.

But do our political traditions seek a welfare state fit for citizens?

For example, within the conservative tradition, which tends to treat the continuity of state and society as the primary goal, while the welfare state may have been unwelcome to begin with it can also be treated as an inevitable accommodation with the forces of modernity. It turns out that the forces of terror, revolution and totalitarianism that were unleashed by the economic insecurities of the modern world are somewhat tamed by creating welfare provision. For example, Bismarck introduced many social reforms in Germany that were clearly motivated by this kind of conservative thinking.

Conservatives value established social institutions and they stress the reliance of the individual on the relationships and communities within which they develop. Conservative critics of the welfare state tend to focus on the need to maintain respect for non-state institutions or the structures of civil society. They often seek a welfare state that promotes family, faith or community. They often worry that notions of equality or citizenship are dangerous to the social order and if they use the term citizen at all it is largely as just another word for ‘subject.’

It is possible to defend the welfare state from within the conservative tradition, but it is likely that any such defence will focus on a welfare state that serves to underpin, without replacing, older social traditions, or which in some way renews those traditions. Such an approach has something to recommend it, but it will seem inadequate to those individuals or groups who are currently excluded from community and active citizenship.

Interestingly the socialist tradition shares some of the same assumptions as the conservative tradition. It deprecates individualism and it values the collective. However it starts with the assumption that social justice has been failed by the status quo. It proposes radical change in society, in order to promote equality. Typically it assumes that this change must be overseen and controlled by the state.

For socialists the welfare state is their own great achievement. The commitment to solve social problems by the means of state-directed activity is socialism in action. However socialists are currently in a slightly difficult position with regard to the justification and criticism of the welfare state. They become torn between seeking to defend or grow the current system or criticising the system in the light of their ultimate vision for social justice. Socialism is not a logically inconsistent, but it is interesting to note that socialist critiques of the welfare system (while they exist) have not yet led to significant social change.

There is a similar ambiguity about the socialist view of citizenship. While conservatives tend to reject citizenship, as a radical idea that subverts respect for proper authority, socialists tend to appropriate citizenship without valuing it. Citizenship becomes just a way of dignifying our shared status as cogs in the state-run machine.

Alternatively citizenship can be seen as at the root of cooperative action, mutuality and the trade unionism that was the initial life blood of socialism. For instance, the National Coalition of Independent Action in the UK, which represents small voluntary organisations has as its sub-title:

We’re not an arm of the state (or the private sector) – we have our own arms.

This seems to me true, but unfortunately it is a theme which barely registers within modern public policy and the media dominated debates of modern life.

The theory that currently dominates modern thought is liberalism, although this is liberalism is divided between Right and Left-liberalism. Right-liberals, like Nozick (sometimes confusingly called neo-liberals) focus on the precedence of civil and political rights, and treat the right to own property as having precedence over other socio-economic rights. They seek to maximise the space for freedom.
Left-liberals, like Rawls, tend to seek to advance the cause of social rights as one part of the full set of our proper rights and they focus on ensuring people have the means to enjoy freedom equally. Simplifying the matter, all liberals are interested in advancing human freedom, but they are divided as to whether they are interested in freedom from oppression or freedom for human development.

Liberals do sometimes use the term citizen, but primarily this is just code for an individual as bearer of rights and duties and as someone who is formally equal within the system of rules, safeguards and securities. We are citizens because we can call on the state to support our rights, although we are also expected to fulfil whatever duties are necessary to the fulfilment of those rights. For a liberal freedom come first, then rights and lastly duties.

[Liberals do often value equal opportunities and they sometimes propose that society be organised so that all citizens can make the best of their abilities within the system – we should all be equally free to climb as high as possible and to achieve as much as possible. This alerts us also to the meritocratic assumptions of liberals: all should be free, but all are not (really) equal.]

Another tradition, one that is closely linked to liberalism and is very influential in social sciences, social policy and contemporary political rhetoric is utilitarianism – the idea that social systems should be organised to maximise the overall level of welfare. Utilitarians don’t need to appeal to citizenship to justify the existence of the welfare state and, at least in principle, utilitarianism may be quite happy to sacrifice individual freedoms, rights and the notion of equality if there are more beneficial social outcomes available without them. Huxley’s Brave New World was a utilitarian dystopia where different ‘grades’ of human being are integrated into one harmonious whole.

Liberalism and utilitarianism can seem like opposing philosophies. Liberalism promotes freedom not the consequences of freedom; utilitarianism is interested in consequences and may sacrifice anything to the desired end. However these traditions of political thought are also twinned.

Liberalism and utilitarianism are both aristocratic forms of thinking. Each is offering a pattern by which rulers can manipulate the complex reality of society. Right-liberals often appeal to the interests of the elites that manage commerce; Left-liberals appeal to the interests of the elites that manage the public-sector. Everyone tries to exploit the kind of utilitarian arguments that can usefully appeal to the electorate.

Arguably what unties these traditions is a shared commitment to meritocracy – that the best of us, should rule rest of us, and for our own good. And aristocracy is just the ancient name for meritocracy – the “aristos” being the best.

Within this meritocratic framework the welfare state plays two roles. First it is an instrument by which power and influence can be exercised over society to the goals of political elites. Second it is an object of dispute in the on-going conflict between powerful political elites. In fact it would not be hard to argue that for the modern political elites the welfare state is more important as an object of political discourse than as an actual instrument of social change.

Such is the unreliability of the instrument and the rapid change in political fortunes that it is a rare politician who really expects to achieve meaningful social change through their temporary control of the instruments of welfare. It is more important to have a good story about the welfare state:

“We are for it – it needs to be made bigger – trust us to make the necessary changes.” 

“We are for it – but its too big or inefficient – trust us to manage it correctly.”

There is no assumption that perhaps people themselves could make their own decisions, at the level of the citizen or community. Where would be the political advantage in that?

Citizenship, real citizenship, is absent from contemporary debates and our analysis of the welfare state – because it doesn’t serve the interests of any of the political elites (Left or Right).

The idea of citizenship does not belong to any one political theory. If taken seriously it would temper the extreme and anti-democratic nature of all the main political theories. But unfortunately it is not in the interests of the powerful to imagine a world where their own power was limited by our citizenship.

© 2017 Simon Duffy

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