REVIEWS
- Greg Waite
VULTURE CAPITALISM Grace Blakeley's "Vulture Capitalism" was my most thought-provoking recent read. The strands she brings together in this book are a/ using examples like Boeing to argue that today's capitalism has nothing to do with free markets, that corporate-State collusion is now business-as-usual; b/ there are no crises for corporations today, because they arrange State bailouts; c/ making a plausible case that socialism is an achievable and necessary alternative; d/ credibly using Marxist analysis by only employing the jargon when it helps to explain real-world examples.
Blakely is English and only 30 but this is her second best-selling book and she's clearly Internet savvy. I've put links to various interviews at the end of this review and they're well worth a listen to get you out of our NZ funk, where the news is dominated by our conservative Government and the timid under-resourced media mostly querying the details. Britain has suffered under the Tories, but has also seen the conservative backlash in their Labour Party which produced today's centrist leader Keir Starmer, so the debate is getting sharper and the appetite for alternatives is clearly growing.
Massive State Bailouts
Here's her explanation for the book's title: "We've had for a long time this argument from the Right that the problem with socialism is that there's this massive State that crushes human freedom, and capitalism is all about free markets, and then actually the experience we've all had living with capitalism is that there's a massive State bailing out massive corporations that literally have nothing to do with the free market".
And on the need for socialism: "There's this idea that you can expand State spending in order to account for failures of the free market, and equally if the market isn't functioning particularly effectively, because let's say there's monopolies, then you can change the structure of the market using political tools to make it work better. My argument is that within capitalist economies, politics and economics have always been merged, and actually there isn't this clean separation that you might think that exists, in practice. And that just means that it's very hard to use policies to try and change things".
Blakely aims to debunk the claims of "free" markets and competition by arguing capitalism now is really a planned economy, controlled by big monopolies and backed by the State. The monopolies plan global strategy, investment and supply chains in conjunction with governments; and small companies and workers have no power.
Specifically, "existing capitalist economies are hybrid systems, based on a careful balance between markets and planning. This is not a glitch resulting from the incomplete implementation of capitalism, or its corruption by an evil, all-powerful elite. It is simply the way capitalism works. Large firms are able, to a significant extent, to ignore the pressure exerted by the market and instead act to shape market conditions themselves".
Bad corporate management is no longer punished by the growth of better-run competitors or buyouts in crises. Mass unemployment and financial crashes are "resolved" through "planning" by the big monopolies and the State. State subsidies and cheap debt keep even bad monopolies afloat, and excess payment to executives and shareholders continue. We pay the price in higher costs and pressure on essential social services.
When their unconstrained greed causes problems and there is a crisis, the big monopolies and the State combine to implement capital's preferred solution, with little cost or consequence for those who created the crises. Costs are shifted to those with the least power-working people, particularly those in the poorest parts of the world.
So, with our current governments so much in bed with corporations, and the economy run by elite planning rather than competitive markets, Blakely argues that socialism offers a planned economy too, but one with more democratic input. "My argument is we need to democratise all of these systems if we're going to get accountability. We can't just rely on the idea that the State's going to protect us from the market or the market's going to protect us from the State. That's really what I call for in the book, is ordinary people organising in the place that they work, in their communities, on the streets, to basically try and take back control of these really powerful institutions".
She presents a range of examples from around the globe including the Lucas Plan of the 1970s, which saw workers develop proposals to transform a transnational arms manufacturer into a worker-owned social enterprise. "The Lucas Plan was an extraordinarily ambitious document that challenged the foundations of capitalism. In place of an institution designed to generate profits via the domination of labour by capital, the workers at Lucas Aerospace had developed an entirely new model for the firm - one based on the democratic production of socially useful commodities".
It was almost as if the workers had never needed managing at all, as though they were creative architects rather than obedient bees". This was a new slice of history for me, a very impressive initiative which opened up many questions - but like all her examples this was local, limited and didn't last. That's not intended as a criticism though. I loved the opening up of a debate about what worker democracy might look like and what it could achieve.
Blakeley calls for an immediate end to trade union restrictions, a four-day working week and universal basic services as a start. She explains: "A far better proposal would be to decommodify everything people need to survive by providing a programme of universal basic services, whereby all essential services like health care, education (including higher education), social care, and even food, housing, and transport are provided for free or at subsidised prices. And ensuring that these services are governed democratically would also help build social solidarity at the local level - something that a UBI (universal basic income) would be unlikely to achieve". She also calls for democratising the central bank and nationalising retail banks.
Critics on the Left have called out these proposals as thin. What about public ownership of the big fossil fuel companies, big pharma (which profited from covid), and the giant social media and tech companies that distort lives and suck trillions out of the productive economy? One reviewer cited the traditional "answer is to build a mass revolutionary movement to bring such a system about" and pointed to the shared history of failure for social-democratic initiatives around the world.
It's too soon to give up and rerun the old scripts though. We live in a very different world today, closing in on our reckoning with ever-increasing corporate greed and imminent climate change. Why not aim for more than State redistribution, but less than bloody revolution? The future looks so grim that we may yet see support build for new solutions. Blakely's enthusiastic call for something we can call socialist, well Left of Labour but well short of the dictatorship of the proletariat, and centred on extending democracy into the workplace but not too specific because we can't know the future, sounds about right.
To Get There, We'd Need A Gradual Transition
Why not start small, progressively extending tax privileges to cooperatives which share profits and power with workers? And we need to rebuild a skilled Government which works for the public good; fund think tanks which research, promote and build those skills. We need to bring down ludicrous executive rewards; we could set a long-term target and steadily increase tax rates for companies who overpay, and levy more tax on monopsonies' excess profits.
Corporations and banks heading for another bailout? Start a small turnover levy and gradually increase it so they fund their own bailout next time. And the New Zealand government has a huge NZ Super Fund which talks the general talk about sustainable investment; we could legislate a mandatory responsibility to review and disinvest in corporations which target short-term gains over long-term productivity. You may have much better proposals, but you get the idea. We can look around for new alternatives which look less like conservative reforms and more like creating a fairer world.
And Grace Blakely may have a few more good ideas and books to contribute. She admitted to a "midlife crisis" at just 29, halfway through writing this book. "I realised that the stuff that I was doing, and the way that I was making sense of what I was doing, was having a really negative impact on me and my mental health. Anyone who puts themselves into the limelight as forcefully as I did, you're looking for something and you will not find it in the places you think you will find it. You will find other things, and those other things will not necessarily be good". She headed for Central America for nine months to recover from the glare of a very public life. That sounds like a smart choice.
Asked in a Guardian interview "how do you abolish global capitalism?", Blakely said: "I see the dissolution of the divide between people who own stuff, and people who work for a living as essential to the construction of a socialist society, and also to a fair society and a just society. But I don't know what that will look like. Marx was also very vague about it. He said: 'I'm not going to write cookbooks for the chefs of the future'". There's a Marx quote I've never heard before.
Extreme Neoliberalism Has Not Worked In UK
To conclude this review, it is worth highlighting why political debate is sharpening up in Britain. Extreme neoliberalism there has definitely not delivered on its promises of greater individual freedom through lower taxation, smaller Government and the privatisation of inefficient State monopolies. The Office for National Statistics forecasts that by 2027-28 the UK will have its highest level of taxation since the Second World War.
Rather than a smaller Government, UK government spending as a percentage of gross domestic product (GDP) is higher now than it was at the start of the 1980s. Instead of deregulation unleashing dynamic "free markets", many industries are dominated by monopolies or oligopolies. Widening income inequality, declining social mobility and especially Britain's reduced life expectancies clearly show the policy failure.
Here are those links to a range of interesting interviews with Grace Blakely: THE BIG CON Mazzucato and Collington's well-researched book is full of examples like this: When Puerto Rico started bankruptcy proceedings in 2016, the US island territory became McKinsey's newest client. The company was hired to advise a Federally-appointed Oversight Board and developed its "aspirational vision" for Puerto Rico by appointing a 31-year-old Harvard graduate as the project's senior full-time consultant.
A 2016 Columbia graduate assisted with financial calculations and job cuts (renamed "rightsizing measures"), and a recent Yale graduate handled hurricane damage assessment. Ultimately, McKinsey advised on a "schema" for the island's ailing economy that included privatising public enterprises and removing labour protections. In developing countries such as Nigeria, Mexico and Angola, hiring consultancies like this was a condition of their International Monetary Fund loan agreements.
Bringing these hidden stories into the light of day provides a guide to the consulting industry and the damage it is doing across our world by weakening businesses and hollowing out State capacity. "The more governments and businesses outsource," they write, "the less they know how to do. Often the capabilities for managing the delivery of a service in-house would be completely lost after they had been outsourced, and so the costs of re-insourcing were very great".
The Seven Main Villains
The three big strategic consultancies (Bain, BCG and McKinsey) and the four big accountancy firms (Deloitte, Ernst & Young [EY], KPMG, and PwC) are the main villains here. The book's strength is the many interviews conducted with consultants inside these companies. Here's one describing working on the UK government's covid response: "It just seemed like every project had loads of wandering Deloitte people ... the sheer volume of them that were around created the situation of these zombie emails just arriving all the time ... taking our attention away from actual work".
Why do bright young graduates keep joining these companies? It's an effective entrance point to the very steep corporate slope these days, where the salaries at the top are now outrageous. And if you don't stick around, the networks you form are helpful in any alternative career. It also helps that consultancies claim to offer an opportunity to save the world, at a time when consultancies are promoting themselves as the experts on managing climate changes, and poor debt-loaded graduates are desperate for their first paying job.
What about governments? Why do they keep falling for consultancies' hollow pitch? The authors look at the evidence and conclude consulting is, at least in part, a confidence trick. According to the authors, consultants do not always meet expectations and they seldom transfer knowledge. There are many examples where engaging consultancies has backfired for states.
In 2010, Sweden started the construction project for a new university hospital in Stockholm. City authorities opted for a public-private partnership which contracted consultants from PwC and EY. The construction company Skanska stated that this model would "transfer the risk from the State and taxpayers to the private sector". Initial costs were €1.4 billion with project completion in 2015. The hospital was three years late and the final cost is estimated at five times the original budget. The consultants evade risk and society bears the costs.
Where's The Accountability?
And it is not all about money. Politicians benefit by off-loading the responsibility for difficult decisions. In the Puerto Rico bankruptcy referred to earlier, President Obama initiated an Oversight Board to supervise the process. Washington added a majority of Board members who were Puerto Rican to look good, and the Board did not hire a large staff to avoid looking like a parallel Government. Instead, it brought in consultants. McKinsey managed the privatisation of public enterprises, healthcare reforms "based on value", slashed public spending and restructured debt - while profiting on owning $US20 million of Puerto Rico bonds debt it was restructuring.
A recurring theme in the book is the contempt consultants (and the people who hire them) have for the knowledge and experience gained by workers, particularly by workers in the public sector. The book is full of stories of consultants who come in and do not understand the work that is done. It shows how they miss key pieces of information, provide shallow analysis and unworkable solutions.
Muzzucato and Collington argue that organisations learn by doing things - and that bringing in consultants ignores what workers already know. It deprives workers and the organisations they work in of the ability to learn more. They blame the 1992 book "Reinventing Government" by US consultants David Osborne and Ted Gaebler for calling for a Government that "steers more, rows less", arguing we need "a Government that rows so it can steer".
By tracing the growth of consultancy firms over the last few decades, the authors show that the current situation is the result of decisions that Governments have made to insulate themselves from controversial decisions, but the result is worse outcomes and higher costs. There is an alternative, and the book ends with four key steps Governments should take to reclaim their power and ability to act.
Not Compatible With Democracy
The authors conclude the Big Con is not compatible with democracy and potentially hugely harmful to the future of our planet, as these consultancies eye up contracts to mitigate climate change. "The Big Con" is an important read, particularly for New Zealanders today. Our conservative Coalition has done an effective job of selling reduced Government on the back of vocal minority opposition to covid mandates. It helps that it has way more money, now that money spent on social media can swing an election.
My feeling is that New Zealand's history as a late colonial nation also played a big part in the conservatives' success selling smaller Government. Colonial Governments both exploit and intensify racial differences, while their half-formed legal systems allow specific classes to grow and become influential on the back of higher profits in the regulatory gaps. First land, then farming, and today our landlords, property developers, trucking and mining industries. If you prefer listening to reading, Collington gives an excellent online summary at their book launch.
SHATTERED NATION The main strength of this book is its many descriptions of everyday life, fleshing out our picture of poor neighbourhoods in Britain to show just how bleak life is for most. Right at the start Dorling does this particularly effectively by asking us, the readers, to recall where we grew up and compare that with how it is today.
In the 1970s, most people in the UK lived in safe neighbourhoods, attended good schools, and had access to quality housing and health care, in an economy which generated something close to full employment. In the 2020s, however, the nation is afflicted by homelessness, pawn shops, food banks, low-paying jobs, insecure pensions, paltry welfare benefits and declining physical and mental health.
A Shattered Society
Britain is now a shattered society, a victim of decades of austerity for the middle class, working class and poor, a casualty of policies that have simultaneously enhanced the immense wealth of society's upper crust. The picture painted by Danny Dorling is not pretty, and he goes on to suggest the UK has been so damaged by 40 years of neoliberalism that it could soon evolve into a dystopia. And this shattering of the community is the result of the policies enacted by all three major political parties - the Conservatives, Labour and the Liberal Democrats - who have shown little interest in the struggles faced by so many.
Dorling also includes a lot of comparative statistics with other European nations to make clear England's failure is not up for political debate; it's a fact. Here's some which jumped out at me.
Looking ahead, Dorling contends that there is no "transformative" agenda in the works. Since Keir Starmer took over the leadership of Labour, the Party has been throwing many of its more progressive policies overboard, including pledging to maintain the Conservatives' removal of child benefits for third and subsequent children. Labour has also made it clear it will not introduce a wealth tax to raise badly needed revenue. This is a continuation of endless neoliberal austerity for the majority and State support for the rich. England is well down the road to becoming a knock-off version of the United States.
More Crises If No Planned Progressive Change
Here is Dorling's concluding warning: "What may help most at this point is to realise that if there is no planned progressive change - change of the kind that last began in 1942 during the Second World War - then in each year from here on there will be more crises. No revolution will occur that will deliver some kind of a rapturous transformation. It is even possible that inequalities could fall within the large majority of the population, while rising overall because just a tiny few at the top are allowed to keep taking more".
"Housing could become even more precarious than it already is, pension funds could fail, the health and social care crisis could deepen, education may become even more unaffordable and mental health become even worse. The people who will lose out the most - if we just try to stagger on with a few minor remedial actions - are not the poorest. They are already suffering the most. Instead, it will be you, the reader of this book, and more and more people like you".
LEGACY OF VIOLENCE This is an important book, using newly released evidence to take a close look at the brutality of British colonialism and its contribution to today's global violence. Part 1 of this review in the previous Watchdog (165, April 2024) documented Britain's expanding system of "emergency" laws to legitimise increasingly violent reprisals in response to colonial resistance.
Part 2 begins at the Second World War, covers the War's escalation of heavy-handed tactics, then Britain's global deployment and continued enhancement of systems to suppress opposition across the empire after the war. The key features of that system were mass detention; forced labour with near-starvation; and interrogation and torture both to classify captives into compliant and non-compliant, and to discourage resistance. During the War, emergency laws were brought home, including detention without trial for British subjects. And the same paramilitary "heroes" who'd pioneered civilian reprisals across the British Empire expanded their violence as the War diminished public and political scrutiny.
During the pre-war Arab Revolt, Arthur "Bomber" Harris, Royal Air Force Commander in Chief of Bomber Command in Palestine, had justified civilian bombings: "We must make up for a lack of numbers by using rougher methods with the rebels than we do in peace. One 250 pound or 500-pound bomb in each village that speaks out of turn within a few minutes or hours of having spoken, or the complete blotting out of a few haunts, 'pour encourageur les autres'".
During the War it was again Harris who argued for the 1943 levelling of Hamburg by firestorm, writing: "The aim of the Combined Bomber Offensive should be unambiguously and publicly stated. That aim is the destruction of German cities, the killing of German workers, and the disruption of civilised community life throughout Germany". Britain's colonial expertise with secret detention bases and torture was transferred to managing large numbers of prisoners of war, with even less oversight under wartime secrecy. Under-nourishment and water torture became routine, and were also employed in the Nuremberg trials.
Over 5.5 million people from the colonies also served in the War, nearly half of Britain's overall forces, and hundreds of thousands in Africa were forced into mine and farm labour with the police and military shooting strikers. Strategically, the Suez Canal and maintaining oil supplies was top military priority, but the rapid fall of under-manned Malaya and Singapore in 1942 exposed the wider Empire's fragility. The rise of the anti-colonial Indian National Army (INA) with German and Japanese support confirmed that many in India saw Britain as the main enemy.
Who Suffered Most In WW2?
This book brought to light suffering in parts of the world I knew little about. The stories were terrible, and raise many questions about the scale of impact of big powers on their colonies, in the East and the West. I wanted some level of objective measure to get a handle on who was most affected by this War. Here are the collated estimates of combined military and civilian deaths as a percentage of 1939 population, sourced from Wikipedia.
As a percent of their 1939 population, the European countries with the highest percent of their people killed were: Poland (17%), Soviet Union and Lithuania (14%), Latvia (13%), Germany (including Austria), Greece and Yugoslavia (9%). Two parts of the Soviet Union were above that 14% average for the Soviet Union; Ukraine (16%) and its neighbour Belarus (25%). Colonies which suffered badly include UK protectorate Nauru (15%), Portuguese Timor (11%), Japan South Seas Mandate (8%), US Guam (7%), US Philippines and French Indochina (6%), Dutch East Indies (5%) and Burma (4%).
Comparing the other major contributors of armed forces in the war and starting with those who lost the most lives, Japan lost 4% of its population, China and the Netherlands (3%), France (1.4% including colonies), Italy (1.1%), the UK (0.9%) and the US (0.3%). Australia lost 0.6% and New Zealand 0.7%. Measurement of Jewish genocide in World War 2 puts the global loss at 55% of total population, with the highest losses in Yugoslavia (89%), Lithuania and Poland (88%), Greece (86%), Czech Republic (84%), Latvia (75%), Hungary and Slovakia (74%) and the Netherlands (71%).
Post-War Colonial Collapse
Returning to the book "Legacy Of Violence", after the War demobilised Indian soldiers who had backed the British returned to a pittance in India with prices skyrocketing. Most of the two million captured Indian National Army (INA) soldiers who fought against the British for independence were released, but 7,000 identified as committing illegal acts of violence were put on trial. The irony of this British-backed Raj trial was obvious when the Government was routinely guilty of racial divide-and-rule, rape, village burnings, crowd shootings and famine-creation. Anti-colonial campaigns escalated into violence, particularly in Bengal.
A campaign by sailors in the Royal Indian Navy in February 1946 demanding demobilisation, increased pay and release of INA detainees led to widespread protests in Bombay and Karachi, shutting down commerce and closing the streets. Major use of State repression was avoided only because the Congress and Muslim League intervened, fearing an uncontrollable escalation of sectarian violence.
The erosion of loyalty in the Indian army, navy and administration left the Raj unable to enforce social order. The British plan shifted to a quick exit and handover, first planned for 1948 then brought forward to 12 August 1947, and including partition of the country based on Hindu-Muslim demographics. A commission under Sir Cyril Radcliffe, who had never been to India, decided these new boundaries.
Industrial unrest and sectarian violence escalated, while the overstretched British Army did little to intervene. On August 14 Lord Mountbatten read George VI's speech: "Freedom loving people everywhere will wish to share in your celebrations, for with this transfer of power by consent comes the fulfillment of a great democratic ideal to which the British and Indian peoples alike are firmly dedicated. It is inspiring to think that all this has been achieved by means of a peaceful change".
The truth is that independence happened precisely because the British were no longer able to command local armed forces to unleash violent reprisals, imprisonment and torture on a scale sufficient to discourage insurrection and maintain foreign wealth extraction. And an estimated one million people died during the large-scale relocations which followed Britain's hasty partition of India and Pakistan before departing.
The Rise Of Israel's Paramilitary
Also important for the shape of today's world, the Jewish National Military Organisation (Irgun) in Palestine had declared war on Britain during WW2. The driving force for this break was Britain's 1939 White Paper which capped Jewish migration to Palestine at 75,000 for five years then at Arab consent, when hundreds of thousands were desperately seeking to escape persecution in Europe. At the same time England was interning recent Jewish arrivals and keeping quotas for Jewish refugees low, with refugee quotas even lower in the United States.
This White Paper introduced a new proposal for a unitary state in Palestine, an Arab state with protections for a Jewish minority, when Britain's 1917 Balfour Declaration had supported the more ambiguous "Jewish national home" in Palestine. Britain was prioritising wartime support from its Arab client states and needed to reduce troops in Palestine.
Unfortunately, Britain had provided paramilitary training to Jewish settlers in Palestine to keep the lid on Arab resistance, drawing "local toughs" into their paramilitary squads and night-time village raids. Resistance from the more extreme Fighters for the Freedom of Israel included assassinations of British policemen and administrators in Palestine.
These assassinations reduced the reach of security forces in Palestine, and eventually killed Lord Moyne, the British minister for the Middle East, based in Cairo. After the War, bomb attacks extended right back to Britain, with MI5 unable to infiltrate the structure of multiple independent cells, and Irgun tactics expanded to kidnappings with execution threats in Palestine.
Zionist Terrorism; British Reprisals
British reprisals and raids uncovered huge weapons caches and evidence of Government infiltration, before a bomb destroyed the luxury King David Hotel which housed British administration in Jerusalem. A 1946 War Office memo concluded "the policy of appeasement (?!) has failed": "If we are to prevent the present situation in Palestine from getting out of hand, strong military preventive action must be taken in Palestine at once" and "the police and troops should be designed to take the offensive against breakers of the law and to ensure that the initiative lies with the forces of the Crown".
In practice, this escalation of State violence under martial law meant new clandestine undercover units which were essentially hit squads. Few spoke any Hebrew and they were not an effective counter to the better organised Zionists, whose next big attack on the Acre prison in Palestine freed 250 prisoners with substantial casualties. The consequences were serious for both sides - Britain put three captured attackers on trial and sentenced them to death; the Irgun captured three police and matched those executions. With this kind of self-justifying tit-for-tat violence, the next level of escalation inevitably followed.
To provide more context for the extremism, at that time MI5 was sinking and sabotaging ships secured to take Jewish refugees to Palestine, while engaging in terrorist reprisals which only loosely targeted the elusive Zionist opposition and also hit many non-combatants. And the various Zionist paramilitary groups believed in their right to emigrate to Palestine, that the Arabs would never accept a Jewish homeland, therefore only the "iron wall" of military force would ensure protection for their community.
Back in Britain, police and soldiers in Palestine had been for years portrayed as carrying out their job (quote) "with characteristic patience, restraint and good humour, a difficult and distasteful job" - the white man's burden myth. So, when the daily newspapers headlined photos of three hanged British police repeatedly over successive days, and refusing to run moderate Jewish condemnations of extremists, the result was five days of antisemitic riots, burnt-out synagogues and businesses in England. And in Tel Aviv, British police burned buses and homes and threw hand grenades into cafes.
At the same time, post-war England was also heavily in debt and counting the costs of having one-tenth of its army in Palestine, £40 million per year counting only direct military expenses. Britain handed the problem over to the United Nations in 1947 which developed a plan for partition into two states; Britain brought forward its exit date; and civil war followed. By the time it finished, half of Palestine's native population, around 800,000 people, had been forced to abandon their homes, 531 villages were destroyed.
Elkins' summary: "It was the gift the Balfour Declaration and Britain's vacillating, self-interested policies bequeathed to them. The use of State-directed violence to enforce British policies and interests created a culture of violence, the legacy of which fuelled sensibilities, tactics and strategies in the Mandate's aftermath".
Then And Now
In 2019 on the 75th anniversary of the death of Orde Wingate, who was the British leader responsible for developing night attacks on Palestinian villages, the Times of Israel offered a lengthy tribute to the man who "might have become the Israel Defence Force's (IDF) first chief of staff" had he lived. "Few non-Jews and even fewer British soldiers are regarded as highly in Israel as Orde Wingate, a senior officer who became a legend here by shaping Israel's pre-state military," the article enthused. "Many Israeli towns have a Wingate street or square". Israeli Knesset member Michael Oren recently said. "The IDF today remains Wingatean in terms of its tactics".
And Elkins again: "Just as events in Palestine were crucial to the convergence and consolidation of colonial-era legalised lawlessness during the Arab Revolt, they were also pivotal in the evolution of para-military mindsets, tactics, and equipment that undulated through the Empire with circulation of (around ten thousand) men trained and combat-tested in Palestine".
Extremes Of British Violence
Warning: some readers may prefer to skip this section, but it's included to show how bad the culture in the British police and army was. British reprisals for the pre-War Arab Revolt included loading villagers into a bus and forcing the driver along a mined road, completely destroying the bus and throwing dead and maimed bodies everywhere. First-hand descriptions include rebels imprisoned for trial being forced to run between two lines of men armed with "pick axes, bayonets, rifles, mallets, whatever was there".
"Any that got through went into the police meat wagon and were sent down to Acre (prison). Any that died, they went into the other meat wagon and they were dumped at one of the villages on the outside. Now when they were taken to Acre, they usually lasted two days, a day, for all of them, and then they were hung". Torture included starvation, beatings, broken bones, sexual abuse, lost eyes, burns and frequently death. And it gets worse post-War.
Hit Squads Become Normal Across The Empire
To keep this review short and readable I have not included Malaya, but there are similarly revealing stories from post-war British rule in Elkins' book. In response to the nationalist insurgency the colonial authorities "launched the British Empire's largest forced migration since the era of trade in enslaved people", relocating over 573,000 people in "resettlement areas". Surrounded by barbed wire, and with guards strictly controlling the inhabitants' movements, one refugee described it as "like a concentration camp".
The use of retaliatory "killer squads" and interrogations by torture became normalised. Rewards as well as setups with planted communist literature or weapons and threats of the death penalty were used to extract information. Planes dropped chemicals to destroy crops. And, as usual, most colonial documents were destroyed on exit; in Malaya's case it took 18 months to store, assess, categorise and destroy or repatriate all the records.
Britain Reaches New Lows Of Inhumanity In Kenya
The Kenyan colonial economy was built on land expropriation for European settlers who grew coffee and tea, lucrative crops that only white farmers could legally produce. The 1.5 million Kikuyu, forced from their land by hut and poll taxes, worked under harsh master and servant laws which criminalised labour resistance and were required to carry a pass controlling where they could work.
After the War, thousands of African soldiers flooded back, while squatters were forced off settler land as prices rose. Calls for "land and freedom" and organisation using adapted versions of traditional oaths created an unusually cohesive anti-colonial movement. By 1957 British Kenya had 100 large-scale detention camps, 12,000 of whose detainees still refused to cooperate, and many more in forced labour camps, a breach of the European Convention on Human Rights. Britain's plan was to empty most of the camps, then negotiate permanent exile for a more limited number of detainees. That required them to classify detainees into compliant and non-compliant, supported by a campaign to break the will of many thousands still determined to resist.
The anonymity and inhumanity generated by war were reinforced here by the language barrier. The only way to classify so many was to use one tribal group against another and extremes of deprivation and abuse. Again, a warning about the level of sadistic violence. "Intelligence" techniques included beating deaths, castrating instruments, electric shocks, dragging behind cars to death, burning cigarettes, fire and hot coals.
Bottles (often broken), gun barrels, knives, snakes, vermin and sticks were thrust up men's rectums and women's vaginas. Bones and teeth were crushed. Fingers sliced off. Collective punishment - the destruction of villages, the denial of food, rape and beating, confinement in small cells filled with vermin and excrement - was normalised.
It took until 1954 and the arrival of a new Police Commissioner, Arthur Young, before the abuses were reported back to Britain. His report was shut down and his resignation arranged, and Churchill's Cabinet unanimously approved a blanket amnesty for the security forces. Techniques to break down resistance became less psychopathic, but no less brutal. The new term "dilution" was coined to hide the reality of organised beatings, starvation and deaths. It took until 1963 for Kenya to gain independence.
Ian Henderson, who worked on the front lines of "intelligence gathering" and was described by one general as having "probably done more than any single individual to bring the Emergency to an end" moved to the British oil-producing protectorate of Bahrain to oversee State security investigations. Known as the "Butcher of Bahrain" for his use of torture, village burning and human rights violations, he received a CBE (Commander of the British Empire) medal from the Queen in 1984.
Contrast all this with Princess Elizabeth's 21st birthday speech in South Africa, 1947: Post-War Economics
In the interwar period, Britain's economic power had waned as America's grew. After post-War negotiations Britain emerged with a large debt it was still paying off until 2006, billions in sterling balances provided by its colonies which had to be returned, and had to make concessions to the US on its tariffs which boosted the profits coming back from the Empire. But that Empire still paid. In 1948 debt-laden Britain had an overall deficit of $US1.8 billion, but Malaya brought in a surplus of $US170 million, the Gold Coast $US47.5 million, Gambia $US24.5 million and Ceylon $US23 million.
However, the many social and economic consequences of this War went well beyond immediate balance sheets, so I pulled in some statistics from Our World In Data to compare nations' growth in gross domestic product (GDP) per person after the War, specifically the 30 years from 1950 to 1980 (Maddison Project Database). Post-War, Japan led with economic growth increasing 7-fold, Oman (6.5) and similar for other oil producers, South Korea (6.1), Germany (3.6), China (2.4), Malaya (2.3) while Australia, US and UK (1.9) and NZ (1.5) were all below the global average (2.2).
Britain's Legacy Of Violence
After reading this book you are left pondering how much Britain's refinement of divide and rule, legalised violence, systems of mass imprisonment and classification, torture and pathological violence across its Empire contributed to subsequent US-led State violence across the world. We were taught through the Cold War to see communism as the main force for State violence, but at the end of this book I'm not sure how that compares with Britain's legacy, or with America's subsequent use of the same techniques and encouragement for worse in its client states.
Don't look to Britain for change. Though it lost the legal case taken by Kenyan victims of torture and paid out £20 million compensation, a later Cypriot case was able to be settled without fuss for £1 million. More recently, the discovery in 2013 of an even larger secret archival stash -1.2 million files stored over 15 miles of floor-to-ceiling shelving - all in breach of the Public Records Act, was deemed beyond the Freedom of Information Act and remains secret. In 2014, when Britons were asked whether "the British Empire was something to be proud of", nearly 60% agreed it was. I am sure, though, that this book will have a significant impact on debate and future resistance in less developed nations whose economies were held back by colonialism.
CUCKOOLAND This is an enjoyable read about British "reputational law firms", which work away in secret using the threat of huge potential legal costs to keep evidence of misdeeds by kleptocrats, corporations and politicians out of public view. That news won't come as a surprise, but some parts of the story may be less widely known.
First, the range of their interference today goes well beyond intimidating journalists. "Cuckooland" centres on a case where an ex-Conservative MP simply dared to raise questions about the Russian-money links of major Conservative donor Mohamed Amersi. So much money is spent today on political influence and reputational white-washing that even Conservatives can't be allowed to ask questions inside their own Party.
Second, the lawyers' de facto method is to publicly undermine the target's character; meanwhile claiming the moral high ground by referencing free speech and public interest; so, undermining the public credibility of voices for social good. But in the real world, they are using the threat of extreme legal costs to tie up the time and resources of their clients' targets and force a backdown.
Third, the mainstream legal system in Britain is falling apart due to underfunding - while this high end of British lawyers is growing and getting rich by protecting the mega-rich. And Burgis makes no bones about the danger of this concealment around the world, emphasising the connection to Putin's cronies. The book's climax is a bizarre day-long haranguing of the author by an enraged Amersi, recorded in full by Burgis at the lawyers' offices.
1970s: DECADE OF PROTEST This book would be a good gift to encourage someone young, and a good reminder for us oldies who lived through the 1970s; it is possible to gather large protests, and to make a difference. "We honour the courageous people from all walks of life who took action for change in the past and those who are doing so today" (from the introduction). The images are grouped under 12 themes: Anti-apartheid, anti-racism, civil liberties, environment, gay rights, housing, international solidarity, peace, pensioners, tino rangatiratanga, trade union action and women's rights. Each section has an introduction and a timeline of significant events through the decade.
The photos were initially gathered for an exhibition of protest photos in Wellington in 2023, with that project feeding into this book and an online Website www.1970sprotestphotos.nz. And - if you have any suitable photos of your own to add, or can name more people in their photos, let the organisers know via the email enquiry@1970sprotestphotos.nz.
It is particularly sobering to see these photos of determined large-scale protest in the 1970s while the ongoing Russia-Ukraine war has killed over 200,000 people and Israel's war on Gaza has killed around 40,000 people. You can buy copies of "1970s: Decade Of Protest" for $40 at Unity Books or add postage of $10 from Steele Roberts Aotearoa; order by emailing Roger Steele.
FORECLOSED AMERICA "From 2007 to 2012, almost 5% of American adults - about ten million people - lost their homes because they could not make mortgage payments". This is an older book about the 2008 crisis, so not reviewed, but I wanted to highlight that shocking statistic showing the scale of the housing mortgage disaster in America. This was a crisis created by Republican government deregulation (2001-2007) but playing out under the Democrats. Imagine a New Zealand where one in every 20 families lost their home. That's what people in the US lived through, with no consequences for the perpetrators of the crisis.
REVIEW
- Linda Hill UNCOMMON WEALTH As part of the Black Lives Matter movement, young British activists are defacing public artefacts that symbolise slavery and colonisation. Others see these actions as "woke", part of the "culture wars" about identity, or as having insufficient focus on the "real world" issues of inequality, insecurity and loss of democratic control. Koram seeks to resolve these differences of perspective.
The British Empire, he says, did not develop from "British exceptionalism" but from capitalism. Nor is it a remnant of a quaint but now irrelevant past. He shows how key mechanisms of the Empire morphed and modernised to underpin corporate globalisation, including its impacts on Britain today. This book is very much for a British audience, but offers food for thought for CAFCA members about how the current global economy developed, to the detriment of most of us.
As a child visiting Ghana, formerly the Empire's "Gold Coast", Koram was told its poverty was because it was a young country. "Development" was a linear process that takes time. Now he sees that process as more of a boomerang. The resource extraction, labour exploitation and privatisation of assets and profits that impoverished people in the "Third World" have now turned to exploit and impoverish working people at the old Empire's core. In his sections on the State, the company, debt, tax and the City of London, Koram explains institutional mechanisms and policies established under the Empire, the changes following decolonisation, then how these are playing out in Britain itself today.
Privatisation & "Out-Sourcing" Not New
Koram begins with the important point that neither privatisation nor "out-sourcing" are new. To build its Empire, the British State typically "out-sourced" imperialist activities - particularly the bloodiest and most brutal ones - to private capitalist companies. The Muscovy Company (est. 1555), the Levant Company (1592), the East India Company (1600), the slave-trading Royal African Company (1660)1, right up to the Royal Niger Company (1889) which became a subsidiary of Unilever (Wakefield's little New Zealand Company, est. 1835, doesn't get a mention).
The investors establishing the company would apply for a charter from the Crown that granted monopoly trading rights. Colonisation by private companies distanced the Crown or Parliament from political responsibility for questionable methods, until at least the mid-19th Century. Of course, company directors, investors and British politicians were mainly the same people wearing the appropriate hat. Underpinning this corporate colonisation were laws protecting private property, Britains common law gift to the world.2
Claims to sovereignty, like those to property, only work if recognised by others, Koram says. British colonisers ignored the sovereignty of others3 and backed their own claims with violence, private armies and, if necessary, the official might of the British Empire. He illustrates this with a story from Iran. When Iran claimed independence in 1951, Prime Minister Mohammed Mosaddegh nationalised the Anglo-Iranian Oil Company (later BP). The British government under PM Clement Attlee imposed a naval blockade, an oil boycott and a bank freeze, then worked with the US and its oil companies to organise a military coup.
"Winds of change" blew through the 1950s and 1960s in the form of widespread and popular independence movements. The colonies gained their political independence (on the approved Westminster model) and joined the UN for support and solidarity. But British companies retained their land and property, resource rights, profits and the economic power.
Capitalist extraction and exploitation continued, "development" required debt, and inequality grew. In Koram's view, "to focus on sovereignty as the key to political control is to underestimate the immense role that the private right to property played in creating the world of empire... and the depths of the legal and financial roots that British capitalism had spread across the world".
Under the Empire, we had technically all been British subjects - yes, that's Article 3 of the Treaty. It was money and time that restricted travel, not visas. So, for OE, we rushed off to British wars. After fighting in WW2, the Māori Battalion thought they'd be treated better, 2.5 million Indian volunteers thought they'd rather have independence, and the British working classes thought they'd rather have a welfare state. Labour PM Attlee gave them one, but see above. Britain imported "the Windrush4 generation" to meet post-War labour shortages, then slowly closed its borders to people not "of British ancestry".
Yet at the same time, Koram points out, it became increasingly open to global movements of money. From 1947 this was guided by the International Monetary Fund (IMF) and World Bank, with currencies fixed to the US dollar (and gold) rather than sterling. From the 1960s, rabid racism, free trade and floating exchange rates were championed by "maverick" MP Enoch Powell and the Hayek-inspired Institute for Economic Affairs, which influenced Margaret Thatcher and later politicians5. British banks permitted accounts to be held in dollars as well as sterling, so "petrodollars" and "Eurodollars" could avoid US restrictions.
London Most Unequal City In Developed World
In 1971 Nixon took the US off the gold standard, followed by Britain and others. Thatcher floated the pound in 1989, liberalised financial trading ("the Big Bang") and began "marketising" infrastructure and services. Unrestricted capital flows and unrestricted credit creation allowed the City of London to become the financial hub of the world. By 2010 London was the most unequal city of all developed countries, and in 2021 had the most millionaires in the world.
Back in the late 1950s and 1960s, the growing number of newly independent members of the UN tried to establish the New International Economic Order. Koram recounts the story of this movement, led by PM Michael Manley of Jamaica, centre of Britain's slave-and-sugar industry for 300 years. The Non-Aligned Movement's influence in the UN was opposed by Thatcher and Reagan, who were now "spreading the gospel of the free market" that we call neo-liberalism.
Deregulated flows of global capital included continuing profits from resource extraction profits and the sovereign debt of developing countries. "This was viewed by many in Britain as a problem with them, not a problem with our global system", says Koram. Initially successful "Third World" economies were hard hit by the 1970s' oil shocks and global interest rate rises. In a 1980 election marked by violence, Manley lost to Edward Seaga ("CIAga") until re-elected in 1989.
Developing countries could refinance at lower rates with the IMF and World Bank if they undertook "structural adjustments", such as cuts to public spending and privatisation of public assets. Yet between 1972 and 1982 the debt repayments of developing countries jumped by over 1,000% and have continued to spiral. Koram describes the IMF and World Bank as now essentially "bailiffs for the world's investors to ensure they would get their money back". He notes that the language of debt is now used as a weapon against welfare states everywhere.
Offshore Tax Havens
Many British leaving former colonies had taken what capital they could to a tax haven rather than back to the high tax rates funding Britain's welfare state. The City of London, since medieval times an "offshore" financial island within Greater London, facilitated this flow from individuals and companies, and continues to do so. It is the hub of a solar system of tax havens. Koram tells the story of the Bahamas and the Caymans as examples of Britain's off-shore children.
Their status as British Overseas Territories means they are internally self-governing (on banking and privacy regulations) while under the responsibility of the Foreign Office. Thus, investors have the reassurance of British property laws and appeal courts while allowing British politicians plausible deniability. But Koram notes that the British government does sometimes exercise powers of direct rule, expelling Chagos Islanders to make way for a US military base (Diego Garcia) in the late 1970s and suspending corrupt local government in the Turks and Caicos Islands in 2009.
Once money had been freed from post-WW2 constraints, the trading of credit and loans became the path to riches for some. Under neoliberalist governments, privatisation of public assets with loss of democratic control began happening in Britain itself. As British industry declined, the housing market became a main engine of Britain's economic growth, says Koram. Wages flat-lined in the 1970s and 1980s and people turned to credit cards, loans and higher mortgages. Each new loan was an asset to be traded in financial markets across the globe, much of it through British banking systems.
"Anchoring the global economy on debt speculation turned out to be a risky idea", Koram writes, but when speculative markets crashed in 2007-8, British banks were bailed out by the Government with public money. The idea that sovereign debt must be paid, no matter what the cost to health, education and social service, was now weaponised against the British public, as it had been in developing countries.
Over the next decade the wealth share of Britain's richest families increased while the "middle share of the pie" collapsed. Groups like UK Uncut and Tax Justice argued that if the Government was short of cash, surely it should be closing tax loopholes, and drew public attention to the off-shore world. Inequality was not just a fact of nature; it was being actively created by policy choices. But the media and politicians preferred to deflect blame onto immigrants, the EU and beneficiaries.
The anti-austerity movement has missed the connection, says Koram, between offshoring practices that contribute to inequality and Britain's colonial history. The off-shore network, he says, is a continuation of colonial dynamics of extraction and exploitation, and an essential element of global capitalism. But taxable income doesn't just magically disappear into some nebulous other world about which nothing can be done. It moves through British hands and institutions to British Overseas Territories over which the Government does still have jurisdiction - if it so chooses.
In 2015 some developing countries tried to use the UN to coordinate effective tax policies. The UK government and other rich countries blocked this. A number of British government ministers and flag-waving Brexiteers were identified as keeping their own money safely offshore. In Koram's words: "The country's wealth is being scurried away offshore while multinational corporations gorge themselves on public resources". In 2020 the Tax Justice Network calculated that, globally, around $US70 billion in taxes was lost on corporate and private money diverted to the Cayman Islands alone.
Instead of reforming corporate tax laws to address revenue deficits, Brexit politicians promoted a fantasy of turning an "independent" Britain into a "Singapore-on-Thames", a low-tax, lightly regulated off-shore island on the edge of the EU. A "Singapore on steroids". Singapore developed in the early 1800s as a major British maritime trading post and also a free port (i.e. tariff free).
Britain lost it to Japan in 1942, then to independence under Lee Kuan Yew. But far from being a miracle of the free market, Singapore is highly interventionist, with high levels of State ownership. As Koram explains in detail, it is an authoritarian state that "cushions the risks of capitalist trade by prioritising the freedom of asset holders over the freedom of every day citizens".
Extracting Resources & Hoarding Wealth
Koram's last chapter is entitled "There Is An Alternative", though he doesn't really lay one out. Rather, he returns to British Left debates about racism vs inequality, culture wars vs those left behind, Black Lives Matter vs fighting global corporations. "Racism isn't just a matter of politeness but about how ideas and institutions reproduce power", he says. "The British Empire was not just a five-hundred-year world tour of being mean to brown people. It was about extracting resources and hoarding wealth".
"There must be a reckoning with the primary reason why empire was created in the first place.... Racism did not spread because of an inherent fear and hatred of people of different appearance, but because there was a need to gain more resources and wealth, and that required making others disposable, particularly those who inconveniently lived on the lands where those resources were located... Empire is quite simply at the root of this country's political and economic system". Words that are equally true in Aotearoa.
Endnotes
REVIEW
- Paul Maunder ISLAND OFF THE COAST OF ASIA In contrast to Marxist analyses that portray the economy as foundational, and the form the State takes as a reflection of the economy, the evidence throughout this book is that the State is foundational to the economy... Clinton Fernandez.
During the 2023 election campaign, where there was very little discussion of foreign policy, I asked the candidates at a local (West Coast) meeting a foreign policy question and Labour MP Damien O'Connor explained that we tend to follow our allies, who are countries with whom we have common values. The other candidates seemed to agree with the sentiment which left me somewhat concerned: Do we really have the same values as the US and the UK?
And then I was visiting Sydney and popped up to Newcastle to see a mate from the union choir and he had on his desk this book by Clinton Fernandez. I idly began reading and became deeply interested - for the book began to bend the usual Marxist narrative in a manner that seemed grounded in current reality.
(For the purposes of this article I'm simply going to give an overview of the argument[s] that Fernandez makes, not worry too much about what's a quote and what isn't and I haven't had the time to get into referencing and given that I'm now working from the e-book version, page numbers would be all over the show anyway).
State Responsible For Survival Of Capitalism
Fernandez writes: "The State is the institution responsible for the survival of capitalism and overwhelmingly, the evidence shows that the 'national interest' means that the public bears costs and risks of the instruments of state-craft, while small groups in control of vast concentrations of capital benefit disproportionately". That's a radical call to arms really, with the State as an institution in the firing line, yet instantly recognisable as the truth. No wonder Noam Chomsky endorsed the book.
The title is both a geographic and geopolitical reference: Britain is an island off Europe; the US is an island off the coast of the Eurasian landmass, so Australia is an island off the coast of Asia. Britain doesn't want a single power to dominate Europe, the US doesn't want that to happen in Eurasia; similarly, Australia with Asia. But Australia doesn't enjoy much clout in the Asian region and has therefore entered alliances with imperial powers, firstly Britain and now the US.
The settlers realised from the beginning that they benefited from the strength of Empire. As Britain expanded over Asia, Australia expanded over its continent. It was to the benefit of the settler colonies to side with imperial rule rather than support any campaign for freedom or national liberation among the Asian colonies. They wanted to stay on the winning side and to have security, not just protection from invasion (in the form of the Royal Navy) but for there to be a political order that guaranteed their economic interests. This paradigm, shared by all future governments, underpins its foreign policy objectives to the present day.
From the beginning a subdued India supplied the Australian colonies with food, clothing and animals. The settler security concerns began to extend over the whole continent, especially to the north as at the same time the colonists sought markets in Papua New Guinea and the south west Pacific. With the 20th Century, as banks and corporations came to dominate the economy, the Government provided them with new markets by taking over Papua New Guinea and Nauru and other territories in the south west Pacific.
With the onset of WWII and the subsequent demise of the British Empire, Australia aligned itself with the US in the Pacific phase of the war and has continued to do so. Economic agreements such as trade agreements and investment treaties, together with international monetary agreements and foreign aid, began then to strongly figure, together with legal instruments such as the Law of the Sea Convention. Covert instruments of statecraft (spying) also began to have importance. Australia was always trying to entice the US into "partnerships"; so, we have the establishment of Woomera and Pine Gap. Finally, with electronic surveillance, the flirtation resulted in commitment, or perhaps we should call it capture.
Throughout, military adventures played an important part, mainly to convince the imperial overlord of the subordinate's fidelity. After participation in the two world wars, this took the form of accompanying the US as it determinedly quashed attempts by South East Asia ex-colonies to establish independent, socialist economies focused on equity. So, we move through the Korean War, to Malaysia, to Vietnam to Indonesia, as the communist "threat" is eradicated. From there to the Middle East, with Iraq and Afghanistan.
Throughout, Australia is busy helping in the forging of military alliances such as the former Southeast Asia Treaty Organisation (SEATO) and ANZUS (which still exists between the US and Australia, but minus NZ since the 1980s), often meeting US indifference. Australia plays its own dirty games with Timor-Leste in order to gain oil and gas revenues. The theme is to keep the developing world in its place; that is, for it to continue to provide raw materials and food to the developed world and to be a market for manufacturers. The drafting of the Law of the Sea Convention saw Australia play a major role in order to obtain a vast portion of sea bed for possible mining activities.
In terms of establishing a post-WWII economic order it found itself in an ambivalent role, for its economy, so dependent on exporting resources, shared some characteristics with developing countries, so that it saw itself as forging a middle path, but eventually going along with the northern consensus which often resulted in the International Monetary Fund (IMF) and the World Bank imposing austerity programmes on developing countries.
Neoliberal Order Is Bipartisan Status Quo
But with the onset of the global financial crises, the neoliberal order was fully accepted by the Hawke - Keating government and this has continued to the present day, where economic power in Australia is concentrated in a few large financial institutions, mining companies, oil and gas firms, and farm-to-shelf agribusiness and retail empires. In terms of the Australian stock exchange 200 firms account for 80% of the market by capitalisation.
The top 20 companies are concentrated in extremely narrow sectors: resource, financial and retail. Their boards are also concentrated in an elite group of 150 individuals. Fernandez remarks that: "The spot price of metals is one of the first things that Australia's Treasurer looks at every morning". When Trump promised to rebuild America's infrastructure the price of iron ore soared, changing tax receipts by $A4.2 billion and nominal gross domestic product (GDP) by $A14 billion in 2018-2019. In return, the US export of services flourished (pharmaceuticals, cultural and digital services).
Fernandez writes that the objective of free trade agreements is to strengthen transnational corporations through "global value chains" (GVCs). These are chains that link intermediate goods and services across borders in order to produce final products with minimum interference from governments, including avoidance of tax. This tax avoidance could be targeted by governments' international intelligence alliances but instead these alliances focus on “terrorism” rather than inequality, reflecting a politically loaded construction of "national interest".
He comments that a small number of Department of Foreign Affairs and Trade (DFAT) officials and their counterparts overseas, along with a few hundred corporate lawyers and lobbyists, negotiate the free trade agreements which are presented in Parliament as a "take it or leave it" deals. GVCs are the dominant pattern of world trade today.
Intermediate goods and services, fragmented both functionally and geographically, are incorporated at different stages of the production process by a network of affiliates, contractual partners and arms-length suppliers. 80% of world trade is simply the movement of these intermediate goods and services within GVCs, all coordinated by transnational corporations and designed to keep moving production to the cheapest possible locations. Meanwhile the corporations' entities are positioned so that profits are declared in the lowest possible tax jurisdiction.
He makes the judgement that states are not bystanders but architects of the GVC world, facilitating trade, development, tax and competition policies. DFAT's role is to ensure a permissive regulatory and political environment for these transnationals which "mobilise vast political power to create these conditions and ensure that they are maintained".
China Threatens To Disrupt The Paradigm
Of course, the rise of China with its State planning threatens to disrupt the paradigm. China's metaphor for the proper role of the market is that the market is "a bird in a cage"; markets providing vitality within the iron cage of State planning. China's rapid rise as an investor in Australia makes it a clear rival to UK and US investors, unused to Asian competition in a country that has traditionally been their unchallenged investment destination.
Accordingly, officials have raised "security concerns" about aspects of Chinese investments e.g. a Chinese company obtaining a lease to operate Darwin's port and Huawei, the telecommunications firm. The latter was perhaps justified, for the Edward Snowden papers reveal that US telecommunications equipment definitely performs spying operations. Such was the paranoia about security that a Solomon Islands' government wishing to award a contract to Huawei was effectively changed by Australian aid and diplomatic influence.
But the greatest challenge that China currently presents lies in its attitude to intellectual property, which it regards as just another factor of production and therefore wants to lower the price. This challenges the West's licencing and monetising of intellectual property, which currently costs Australia dearly. It should, in fact, side with the developing world agenda to facilitate technology transfer as a key enabler of development, rather than support the patents agenda of the US, the EU and Japan.
But with the rise of China and the increasing debilitation of the US, Australia has to choose between its greatest military ally and its greatest trading partner. From the time of colonial arrival to the Global Financial Crisis they were one and the same. Now they are different and this produces a denial of reality: Instead of referring to the Asia-Pacific, Government officials refer to a rules-based order in the Indo-Pacific, in the rather naïve hope that China will accept US hegemony. But the US blithely ignores international rules which don't suit, even if it has signed up to the rules, so China is unlikely to be convinced.
A major strategic question for Australia is whether the US alliance would be worth preserving if it required Australia to fight alongside the US in a war against China which is calculated "to be intense, last a year or more, have no winner and inflict huge losses and costs on both sides". The consequences for Australia would be huge with massive economic disruption. Watch this space.
In summary, Fernandez writes that the Australian government acts abroad without the constraints and obstacles it faces at home. It can interact with business corporations and foreign governments in relative privacy and its embassies and DFAT give it an institutional endurance and a strategic weight that small, poorly funded civil society groups or individuals cannot match. The Government is also protected by a bipartisan consensus.
The underlying reality of Australian life then, is that "the most important decisions happen in the private sector as to what is to be produced, where investment should take place, and who is to own the profits. The 'national interest' amounts in practice to having the public bear the costs and risks of diplomacy, law, investment, research, negotiations, espionage and other instruments of statecraft while small groups in control of vast concentration of capital benefit disproportionately". The military instrument, wielded often in Australian history, differs in one crucial respect; it requires the mobilisation of larger numbers of Australians and calls for greater risks and sacrifice.
Domestic Power Structure Needs Radical Change
Out of this emerges another two aspects of Australian life: military commemorations, honours and awards; and fear and anxiety as an explanation of Australian foreign policy, without analysis of behaviour that might increase that fear and anxiety, such as the invasion of Iraq. If that fear is about countries or groups hostile to an international environment in which business corporations can operate with relative freedom then the fear is highly functional, meaning that regardless of which political party is in Government, reforming foreign policy will require radically changing the domestic structure of power.
Fernandez makes, then, a powerful revolutionary argument and one in which his framework of (I suspect) anarcho-syndicalism, provides a clarity which is often missing in other writing. Throughout the reading I was comparing the Australian experience to the New Zealand experience and I have come to the conclusion that there's a local book to be written.
Watchdog - 166 August 2024
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Corporate Crimes, Backdoor Bailouts And The Death Of Freedom
by Grace Blakeley, Bloomsbury, UK, 2024
PoliticsJOE interview:
Owen Jones interview:
Scotonomics interview:
Byline Times interview:
PushBack Talks:
Arise Festival: Jeremy Corbin & Grace Blakely:
Grace Blakely TikTok:
How The Consultancy Industry Weakens Our Businesses,
Infantilises Our Governments And Warps Our Economies
Mariana Mazzucato and Rosie Collington, Penguin, UK, 2024
Inequality And The Geography Of A Failing State
Danny Dorling, Verso, UK, 2023
A History Of The British Empire
(part 2 of a 2 part review, covering from 1939)
Caroline Elkins, Penguin, UK, 2023
"I declare before you all that my whole life whether it be long or short shall be devoted to your service and the service of our great imperial family to which we all belong. If we all go forward together with an unwavering faith, a high courage, and a quiet heart, we shall be able to make of this ancient commonwealth, which we all love so dearly, an even grander thing - more free, more prosperous, more happy and a more powerful influence for good in the world - than it has been in the greatest days of our forefathers". Reading this book not long after Queen Elizabeth II's funeral, when the military role of the British monarchy was on full display, was sobering to say the least.
Where The Rich Own The Truth
Tom Burgis, William Collins, UK, 2024
Protest Photos NZ Group
Steele Roberts, NZ, 2023
Isaac Martin and Christopher Niedt
Stanford University Press, US, 2015
Britain And The Aftermath Of Empire
by Kojo Koram, 2023"The same laws of private property that emerged from a compromise between the feudal aristocracy and the rising capitalist class in early imperial England, which encouraged companies to undertake imperial voyages confident that whatever treasures they plundered would belong to them to the exclusion of others, still serve as the model for transnational derivative trades, credit default swaps, claims to intellectual property, debts or digital codes today".
Instruments Of Statecraft In Australian Foreign Policy
by Clinton Fernandez, Monash University Publishing, 2018
Non-Members:
