George Monobit's TWO Articles

How the neoliberals stitched up the wealth of nations for themselves

A cabal of intellectuals and elitists hijacked the economic debate, and now we are dealing with the catastrophic effects
George MonbiotTuesday August 28, 2007The Guardian

For the first time the UK's consumer debt exceeds the total of its gross national product: a new report shows that we owe £1.35 trillion. Inspectors in the United States have discovered that 77,000 road bridges are in the same perilous state as the one which collapsed into the Mississippi. Two years after Hurricane Katrina struck, 120,000 people from New Orleans are still living in trailer homes and temporary lodgings. As runaway climate change approaches, governments refuse to take the necessary action. Booming inequality threatens to create the most divided societies the world has seen since before the first world war. Now a financial crisis caused by unregulated lending could turf hundreds of thousands out of their homes and trigger a cascade of economic troubles.
These problems appear unrelated, but they all have something in common. They arise in large part from a meeting that took place 60 years ago in a Swiss spa resort. It laid the foundations for a philosophy of government that is responsible for many, perhaps most, of our contemporary crises.When the Mont Pelerin Society first met, in 1947, its political project did not have a name. But it knew where it was going. The society's founder, Friedrich von Hayek, remarked that the battle for ideas would take at least a generation to win, but he knew that his intellectual army would attract powerful backers. Its philosophy, which later came to be known as neoliberalism, accorded with the interests of the ultra-rich, so the ultra-rich would pay for it.
Neoliberalism claims that we are best served by maximum market freedom and minimum intervention by the state. The role of government should be confined to creating and defending markets, protecting private property and defending the realm. All other functions are better discharged by private enterprise, which will be prompted by the profit motive to supply essential services. By this means, enterprise is liberated, rational decisions are made and citizens are freed from the dehumanising hand of the state.
This, at any rate, is the theory. But as David Harvey proposes in his book A Brief History of Neoliberalism, wherever the neoliberal programme has been implemented, it has caused a massive shift of wealth not just to the top 1%, but to the top tenth of the top 1%. In the US, for instance, the upper 0.1% has already regained the position it held at the beginning of the 1920s. The conditions that neoliberalism demands in order to free human beings from the slavery of the state - minimal taxes, the dismantling of public services and social security, deregulation, the breaking of the unions - just happen to be the conditions required to make the elite even richer, while leaving everyone else to sink or swim. In practice the philosophy developed at Mont Pelerin is little but an elaborate disguise for a wealth grab.
So the question is this: given that the crises I have listed are predictable effects of the dismantling of public services and the deregulation of business and financial markets, given that it damages the interests of nearly everyone, how has neoliberalism come to dominate public life?
Richard Nixon was once forced to concede that "we are all Keynesians now". Even the Republicans supported the interventionist doctrines of John Maynard Keynes. But we are all neoliberals now. Margaret Thatcher kept telling us that "there is no alternative", and by implementing her programmes Clinton, Blair, Brown and the other leaders of what were once progressive parties appear to prove her right.
The first great advantage the neoliberals possessed was an unceasing fountain of money. US oligarchs and their foundations - Coors, Olin, Scaife, Pew and others - have poured hundreds of millions into setting up thinktanks, founding business schools and transforming university economics departments into bastions of almost totalitarian neoliberal thinking. The Heritage Foundation, the Hoover Institute, the American Enterprise Institute and many others in the US, the Institute of Economic Affairs, the Centre for Policy Studies and the Adam Smith Institute in the UK, were all established to promote this project. Their purpose was to develop the ideas and the language which would mask the real intent of the programme - the restoration of the power of the elite - and package it as a proposal for the betterment of humankind.
Their project was assisted by ideas which arose in a very different quarter. The revolutionary movements of 1968 also sought greater individual liberties, and many of the soixante-huitards saw the state as their oppressor. As Harvey shows, the neoliberals coopted their language and ideas. Some of the anarchists I know still voice notions almost identical to those of the neoliberals: the intent is different, but the consequences very similar.
Hayek's disciples were also able to make use of economic crises. An early experiment took place in New York City, which was hit by budgetary disaster in 1975. Its bankers demanded that the city follow their prescriptions - huge cuts in public services, smashing of the unions, public subsidies for business. In the UK, stagflation, strikes and budgetary breakdown allowed Thatcher, whose ideas were framed by her neoliberal adviser Keith Joseph, to come to the rescue. Her programme worked, but created a new set of crises.
If these opportunities were insufficient, the neoliberals and their backers would use bribery or force. In the US, the Democrats were neutered by new laws on campaign finance. To compete successfully for funding with the Republicans, they would have to give big business what it wanted. The first neoliberal programme of all was implemented in Chile following Pinochet's coup, with the backing of the US government and economists taught by Milton Friedman, one of the founding members of the Mont Pelerin Society. Drumming up support for the project was easy: if you disagreed, you got shot. The International Monetary Fund and the World Bank used their power over developing nations to demand the same policies.
But the most powerful promoter of this programme was the media. Most of it is owned by multimillionaires who use it to project the ideas that support their interests. Those ideas which threaten their interests are either ignored or ridiculed. It is through the newspapers and TV channels that the socially destructive notions of a small group of extremists have come to look like common sense. The corporations' tame thinkers sell the project by reframing our political language (for an account of how this happens, see George Lakoff's book, Don't Think of an Elephant!). Nowadays I hear even my progressive friends using terms like wealth creators, tax relief, big government, consumer democracy, red tape, compensation culture, job seekers and benefit cheats. These terms, all invented or promoted by neoliberals, have become so commonplace that they now seem almost neutral.
Neoliberalism, if unchecked, will catalyse crisis after crisis, all of which can be solved only by greater intervention on the part of the state. In confronting it, we must recognise that we will never be able to mobilise the resources its exponents have been given. But as the disasters they have caused unfold, the public will need ever less persuading that it has been misled.

Drumming Up a New Cold War


Posted July 31, 2007

By signing up to Bush’s missile defence programme, the British government shows it doesn’t give a damn about either peace or democracy

By George Monbiot. Published in the Guardian 31st July 2007
In one short statement to parliament last week, the defence secretary, Des Browne, broke the promises of two prime ministers, potentially misled the House, helped bury an international treaty and dragged Britain into a new cold war. Pretty good going for three stodgy paragraphs.
You probably missed it, but it’s not your fault. In the 48 hours before parliament broke up for the summer, the government made 76 policy announcements(1). It’s a long-standing British tradition: as the MPs and lobby correspondents are packing their bags for their long summer break (they don’t return until October), the government rattles out a series of important decisions which cannot be debated. Gordon Brown’s promise to respect parliamentary democracy didn’t last very long.
Thus, without consultation or discussion, the defence secretary announced that Menwith Hill, the listening station in Yorkshire, will be used by the United States for its missile defence system(2). Having been dragged by the Bush administration into two incipient military defeats, the British government has now embraced another of its global delusions.
Des Browne’s note asserted that the purpose of the missile defence system is “to address the emerging threat from rogue states”. This is a claim that only an idiot or a member of the British government could believe. If, as Browne and Bush maintain, the system is meant to shoot down intercontinental missiles fired by Iran and North Korea (missiles, incidentally, that they do not and might never possess), why are its major components being installed in Poland and the Czech Republic? To bait the Russian bear for fun? In June, Vladimir Putin called Bush’s bluff by offering sites for the missile defence programme in Azerbaijan and southern Russia, which are much closer to Iran(3). Bush turned him down and re-stated his decision to build the facilities in eastern Europe, making it clear that their real purpose is to shoot down Russian missiles.
Nor is it strictly true to call this a defence system. Russia has around 5700 active nuclear warheads(4). The silos in Poland will contain just 10 interceptor missiles. The most likely strategic purpose of the missile defence programme is to mop up any Russian or Chinese missiles which had not been destroyed during a pre-emptive US attack. Far from making the world a safer place, its purpose is to make the annihilation of another country a safer proposition.
This strategic purpose takes second place to a more immediate interest. Because it doesn’t yet work, missile defence is the world’s biggest pork barrel. The potential for spending is unlimited. First a number of massive - and possibly insuperable - technical problems must be overcome. Then it must constantly evolve to respond to the counter-measures Russia and China will deploy: multiple warheads, dummy missiles, radar shields, chaff, balloons and God knows what. For the US arms industry, technical failure means permanent commercial success.
But this is not the only respect in which Browne appears to have misled the House. He claimed to have assurances from the US that “the UK and other European allies will be covered by the system elements they [the Americans] propose to deploy to Poland and the Czech Republic”. Browne must be aware that this is a United States missile defence programme. It incorporates no plans for defending other nations. The British government has handed over its facilities, truncated parliamentary democracy and put its people at risk solely for the benefit of a foreign power.
The diplomatic cost of this idiocy is incalculable. It has already required the abandonment by the US of the Anti-Ballistic Missile Treaty, which is the bilateral agreement struck between the United States and the Soviet Union in 1972. It survived both the vicissitudes of the Cold War and the collapse of the Soviet Union, but not George W Bush. Any hope that it might be revived has now been buried by the facts on the ground in Poland, the Czech Republic and the United Kingdom. Two weeks ago Vladimir Putin suspended another long-standing agreement: the Conventional Armed Forces in Europe Treaty, which limited the troops and military hardware Russia could assemble on its borders. In response to the US missile defence programme, Russia has also been testing a new version of its short-range Iskander nuclear missile, and it has been developing a new intercontinental missile with multiple warheads, called the RS-24. Their purpose, according to Sergei Ivanov, the deputy prime minister, is to “overcom[e] any existing or future missile defence systems”(5). The Iskander missiles will be deployed on the European border and aimed at Poland and the Czech Republic. Intermediate-range missiles will be pointed at Menwith Hill.
Bush’s missile defence programme almost certainly means the end of the intermediate-range nuclear forces treaty as well, and the cancellation of any successor to the strategic offensive reductions treaty (which expires in 2012). Asked whether this might be the beginning of a new cold war, Putin replied “Of course we are returning to those times. It is clear that if a part of the US nuclear capability turns up in Europe, and, in the opinion of our military specialists will threaten us, then we are forced to take corresponding steps in response … We are not the ones who are initating the arms race in Europe.”(6) Like the war with Iraq, the US missile defence programme exacerbates the threats it claims to confront.
All this, as you would hope, is of some interest to our members of parliament, who have long been demanding a debate. In February, Tony Blair agreed that they would have one. “I am sure that we will have the discussion in the House and, indeed, outside the House…. When we have a proposition to put, we will come back and put it.”(7) In April, Des Browne told MPs that “the UK has received no request from the US to use RAF Menwith Hill for missile defence-related activities.”(8) That, until last week, was all that parliament knew. Now we discover that the proposition had been made and accepted before MPs had a chance to discuss it. Browne was in the House on Wednesday, where he made some announcements about aircraft carriers and the military budget. These - because they were delivered in person - could be discussed, though (shamefully) neither of them provoked any opposition(9). But knowing that the Menwith Hill decision would be furiously opposed, Browne released it in the form of a written statement, which cannot be debated.
Like everyone on the left in Britain, I wanted to believe that Gordon Brown’s politics would be more progressive than Tony Blair’s. But as he grovels before the seat of empire, I realise that those of us who demand even a vaguely sane foreign policy will find ourselves in permanent opposition. With his appointment of Digby Jones as trade minister and his plans for deregulation, Brown demonstrated that the government is still mesmerised by big business. By proposing that suspects be held for up to 56 days without charge, he appears to share Tony Blair’s distrust of liberty. Now, in one furtive decision, he reveals both his contempt for parliament and his enthusiasm for the neocon project. What, I wonder, is there left to hope for?