A blog by Luke Akehurst about politics, elections, and the Labour Party - With subtitles for the Hard of Left. Just for the record: all the views expressed here are entirely personal and do not necessarily represent the positions of any organisations I am a member of.

Friday, March 13, 2009

I'm with Gorby on mixing capitalism and socialism

My birthday twin Mikhail Gorbachev (both 2nd March though several decades apart) has been taken to task by my near neighbour in Stoke Newington Dave Osler for saying this on his visit to the Evening Standard yesterday (goodness knows how it went down with them):

“We need to find a new model of capitalism, taking the best of the old model and the best of socialism …”
“From capitalism, it must take incentives and stimulus and from socialism, more equality and social justice,” Mr Gorbachev, wearing a pin-striped suit and a black polo neck jumper, told the newspaper’s staff …
He praised Gordon Brown, the prime minister, for taking “several really wise decisions” and said the opposition Conservatives had not given up on “Reaganomics”, the economic policies promoted by the former US president. “Maybe they would like to take the initiative but they are not ready for that.”

I'm with Gorby on this ideological approach, and believe it is a historic tragedy that he never got to try it in Russia - he was starting to elaborate a social democratic future for Russia in his final years in office before the Yeltsin rush to full-blooded capitalism.

Dave Osler accepts that "Social democracy resulted in some of the most humane societies ever created" but then says "But the key point is that [it] failed."

I don't accept that that's the case. In Sweden in particular, and also the other Nordic countries, there have been market reforms in the last 20 years but the fundamentals of the social democratic society are still going strong. The Swedes have managed to create an egalitarian welfare society which whilst not problem-free (e.g. on the integration of immigrants) has dramatically fewer social problems than the UK because, as the Guardian explained today, our society is screwed up by inequality. At the same time they have globally competitive manufacturing industries.

Unless you inhabit a fantasy land where you think a new economic system based on social ownership of the means of production, distribution and exchange, and the abolition of the market, is attainable or more to the point, desirable, then rejecting social democracy - the half-way house that tries to mix the best aspects of socialism and capitalism - leaves you with full-on Thatcherite capitalism. I don't find either economic model remotely appealing.

I'm for the real world that Gorby is in where we try to build the best realistically attainable society, not repeat the disastrous Utopian projects of the 20th century which tried to create perfect societies but in doing so created nightmares. The degree of control implicit in what Dave would call socialism - a non-market economy - inevitably leads to the suppression of choice and liberty we saw in the USSR, and would have done whether the Soviet Union had been led by Trotsky instead of Stalin.

If social democracy really has "failed" as an option as Dave suggests, then Labour as a party might as well shut up shop and leave the field to a fight between the SWP and the Tories. The real ideological debate is about where on the spectrum between socialism and capitalism social democrats should be taking their parties, and if in power, their countries. We ought to reject a false choice between a heartless economic system and an unworkable one.


Blogger Mark Still News said...

Gorby sold out the Soviet Union!

The soviet was an inspiration for workers democracy and independence!

The Soviet was more powerful at one point than any other Nation. 70 years of struggle against imperialism by the soviet people was signed away by Gorby, he is a traitor!

Look at the soviet now it is a rich pigs playground, perhaps worse than it was under the TSAR's?

The soviet gave the world a balance of power and help liberate many countries from oppression!

12:39 am, March 14, 2009

Blogger Bill said...

Of course, Soviet State Capitalism failed dismally, any dictatorial system would fail, and although good at extensive exploitation of capital, it wasn't adroit at intensive exploiitation (the Asian Tiger crisis stemmed from a similar route).

That is, the USSR failed as a market system, and social democracy fails through the same fault.

12:06 pm, March 14, 2009

Blogger Ravi Gopaul said...

With regards to social democracy (democratic socialism) the mixed economy is the way to go; I don't fancy going to a state owned resturant for instance!

That said I do believe the state has a role in the running of the economy which is why I think the strategic industries should be state owned along with the utilities (gas water and electricty/nuclear).

Education is very important too, especially now as we are entering resession where workers will need to retrain in order to gain employment. Which is why I want to see the scrapping of tuition fees and an improvement on student finance.

Social housing is an important issue now, with repossessions on the rise and no improvement on the housing market. I believe the state should be the provider of this.

Somethings are are too important not to be run by the state and somethings are better privately owned, but regualated by government.

In my mind, free markets are a mechanism to further subjugate the poorer (and thereby most vulnerable) in society. This is where I believe Labour has lost its way. Capitalism is not a system of benevolence, and I believe it is unfair for people to expect it to be. It is more of a generater of cash, which can be used to fund social justice. Without socialism workers and the poor would have no say. This adds credence to the belief socialism and capitlism are more siamese twins rather that seperate entites. That means instead of us trying to produce limited government, we should be in the process of making it fairer for our poorest. Good governance should be based on how governments deal with the poorer members of society. Fairer trade union laws (I'm in favour of the entire workfore being unionised) and a robust welfare state.

Capitalism as it exsists in its free market exploitive form is unsustainable (there are only so many resourses available on the planet). If it is to have a future, capitalism has to be remolded in a social democratic framework. That is labourist socialism not New Labour.

3:29 pm, March 14, 2009

Anonymous James Thurston said...

I totally agree with you Luke.

There is no doubt that we need to find a Halfway-House between State Socialism and Unbridled Capitalism (the former which would be great in as you say a 'Fanatsy World' and the latter of which I absolutely abhore).

However, that does mean that Labour must ditch its ingrained devotion to the Neo-Liberalism of Thatcher eg. Privatisation and deregulated Big Business.

For example, Peter Mandelson MUST ditch his plans to sell off 30% of the Royal Mail. He argues that the Party must push this through or lose the next GE. This argument needs to be turned fully on its head. If Labour pushes ahead with the Part Privatisation of the Royal Mail it will LOSE the next GE.

Furthermore, Labour must reverse its Market reforms in the NHS and Local Government: they have lead to a riduculous fixation with cost reduction, performance management, targets, spin, contract management I could go on. All this has lead to excessive expenditure on administration/ management at the expense of Front Line Services starving them of much needed resources and money. Both the NHS and Local Government Services, Network Rail and other Public Services have a far too 'Top Heavy' organisational structure.

There is no question that many Public Services have improved, but they have become much too commericially orientated: preoccupied with income generation, brand image and contracting.

I am not in any way advocating a return to the politics of 'Old Labour' but am instead in favour of building on the positives of 'New Labour' and creating a Post Blairite 'New New Labour'. The politics of both 'Old Labour' and what I call 'Old New Labour' have largely failed.

Ever since its creation I was, until the fresh challenges facing the UK and the Globe emerged in the latter half of 2007, a very loyal and ardent advocate of 'Blairite New Labour', however it is now time for Labour to move on towards a new politics.

Just as the supporters of 'Old Labour' in the 1980's and 1990's were the 'dinosaurs' so the advocates of 'Blairite New Labour' are the 'dinosaurs' of the present day.

3:49 pm, March 14, 2009

Blogger Mark Still News said...

Although I do believe everything should be Nationalised and owned and controlled by the workers. I am prepared to make compromises and accept a Socialist system that regulates and controls the Markets for the benefit of all, not just for a handful of greedy slime rich dirty exploiters!

3:54 pm, March 14, 2009

Blogger tory boys never grow up said...

If social democracy failed it makes you wonder what successful economic model Dave Osler wants us to pursue instead.

However, perhaps we need to think a little bit more about how the State intervenes in market economies - especially now that era of deregulation has well and truly ended. Perhaps those who are opposing the partial sale of the Post Office need to come up with some alternative views as to how to get in the investment and management skills to improve a service which is deteriorating and not adapting to what the customer wants - unfortunately, I see little other than a defence of the staus quo.

Not that the present Government is excused howver - where it has tried regulation it has been pretty awful and ineffective, and often portrays a lack of a basic understanding about the markets it is trying to regulate.

Sadly, I fear we are just going to have a rerun of the state (good) market (bad) debates - especailly on the evidence of the comments to date.

9:28 am, March 15, 2009

Blogger kris said...

erm, Billy, our society is in a shambles because everyone feels owed a living.

The Swedish example you note is based upon large oil revenues and a Luthern get off your arse and honest work population. This is how they afford decent retirements, education and health-care.

10:21 am, March 15, 2009

Blogger Merseymike said...

I think we would largely be in agreement that social democracy is a halfway house between the market and planned socialism.

My problem is that whereas I think that Labour and the vision of Crosland used to believe in this, new Labour has moved far too much towards support for and belief in the market. Social Democratic values regarded the market as being a tool, nothing more - and certainly something primarily to be controlled and to be regarded with suspicion

8:26 pm, March 15, 2009

Anonymous Rich said...

Mark Soviet Union may well have been powerful but living under the Iron curtain was hardly free of problems.

Neither communism or capitalism works. what we need is something that relies less on the markets.

9:08 pm, March 15, 2009

Blogger Luke Akehurst said...


Sweden has no oil. You are confusing them with Norway.

10:10 pm, March 15, 2009

Anonymous James Thurston said...

Do you largely agree with what I stated in my post Luke??

It would be great if you would expand on what your post states and comment on what responses to that you have got!

12:12 pm, March 16, 2009

Anonymous James Thurston said...

Do you believe in maintaining the 'Status Quo' ie an over reliance on the market and deregulation regarding the policy and ideological direction of the Labour Party?

Or would you much further prefer to see a move to much less of a reliance on the market and greater regulation without going back to repeating the mistakes and approach of 'Old Labour' of the 1970's and 80's? A 'Human Face of Capitalism' if you like?

12:20 pm, March 16, 2009

Anonymous Anonymous said...

SOCIALISM IS EVIL YOU RETARDS it breaks and destroys everything it touches, most importantly the human spirit

5:08 pm, March 16, 2009

Blogger Miller 2.0 said...

My question for Luke is where he sees differences between himself and capitalism (and I don't just mean the Thatcherite variant).

5:34 pm, March 16, 2009

Anonymous Nancy said...

Dirty .Rotten .Imbeciles had a great song called Reaganomics.

Social Democracy is a dodo. National Socialism is the way forward for Britain!

9:29 pm, March 16, 2009

Anonymous Alan Clark said...

As Nietzche said socialism and nationalism are both "dominated by envy and laziness".

9:32 pm, March 16, 2009

Anonymous Junius said...

I'm impressed - Luke actually wrote something I can respect, if not quite agree with.

Shame about all the hard-left nutters it brings out, all yearning for that "perfect" society...

9:51 pm, March 16, 2009

Blogger Merseymike said...

...and , Kris, actually, no. The way they afford those things is much higher direct taxation than a Tory like you would be prepared to pay.....

10:51 pm, March 16, 2009

Blogger kris said...

Dear Diary

I stand corrected by Luke.

I found this interesting http://www.cato.org/pubs/pas/pa-160.html but wonder how dated it is?

11:04 pm, March 16, 2009

Blogger kris said...

as for Mersey frickin Mike

I voted for Obama.


11:05 pm, March 16, 2009

Blogger Bill said...

The basic question is, how do you mix the abolition of the wages system with the wages system, as the title of the post proposes? ow do you emancipate labour while leaving it still exploited? It's all well tryign to find the golden mean, but the golden mean between being pregnant and not being pregnant isn't sort-of pregnant.

7:50 am, March 17, 2009

Blogger Merseymike said...

Kris: if you hold the views you do, why?

5:00 pm, March 17, 2009

Blogger Mark Still News said...

Read Robert Tressell's ragged trousers and philanthropists all the answers are in that book written by a common decent man?

10:46 pm, March 17, 2009

Anonymous James Thurston said...


You claim:
"SOCIALISM IS EVIL YOU RETARDS it breaks and destroys everything it touches, most importantly the human spirit."

It may be apparent to most people that YOU are the Idiot and RETARD!

Your comment displays that either
(a) You have behaved as an 'Osterich with its head in the Sand' over the past 30 years and partuicularly during the current Credit Crisis.


(b) You have been in hibernation for the past 30 years.

You may be strongly advised to get your head out of the sand and wake up!!

For the past 30 years the UK and the Globe has been ruthelessly exposed to a very virulent strain of Neo-Liberal Capitalism that has "broken and destroyed everything it touches, most importantly the human spirit."

This phenomenon of which will scar generations to come.

1:55 pm, March 18, 2009

Anonymous Lukus Hitler said...

Osterich with his hed in the sand?

Is that Joesph Fritzl?

9:20 pm, March 19, 2009

Anonymous Anonymous said...

I don't know about this Gorby stuff. I mean, the comparisons and what have you can be a bit silly, what with his actions in the Communist Party being specific to Soviet realities, not only of the time the changes were happening, and the context of what 'socialism' meant in the Soviet Union. The attempt at creating a Soviet 'civil society' in the 1980s was overtaken when the regime actually collapsed , by forces beyond its control. Authoritarian state collectivism, and what has replaced it, has its origins in a political culture very different to our own.

9:49 pm, March 21, 2009


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